Summit Materials joins calendar; Altice gains continue; VistaJet falls post-earnings

By Paul A. Harris and Abigail W. Adams

Portland, Me., Nov. 27 – The high-yield primary market staged a modest post-holiday reactivation on Monday.

No issues were priced.

Summit Materials, LLC and Summit Materials Finance Corp. began marketing an $800 million offering of senior notes due January 2031 (current ratings Ba3/BB).

Initial guidance has the deal coming to yield in the high-7% to 8% area.

The acquisition financing deal is set to price later this week.

New issue news volume should pick up during the Tuesday and Wednesday sessions, according to a sell-side source who noted that market participants who wangled an extended Thanksgiving holiday weekend were trickling back to their desks on Monday.

Meanwhile, the secondary space saw a muted session on Monday with the cash bond market largely unchanged.

As market players awaited the primary market to reactivate, earnings-related news was the main driver of activity and price movement during the session.

VistaJet Malta Finance plc’s senior notes (B3/B-) were under pressure after the company reported earnings with the notes falling 2 to 4 points.

However, Altice’s capital structure continued to post gains after Altice International’s earnings report the previous week.

Altice France Holding SA’s 5 1/8% senior notes due 2029 (B2/B-) continued to add to the strong post-earnings gains of the previous week.

And the positive momentum spilled over to Altice Financing SA’s 5¾% senior secured notes due 2029 (B3/B) and Altice USA, Inc. subsidiary CSC Holdings, LLC’s 11¼% senior guaranteed notes due 2028 (B2/B) with both issues logging gains in active trade.

VistaJet under pressure

VistaJet’s senior notes were the laggards of Monday’s session, falling 2 to 4 points after disappointing earnings.

The private jet company’s 6 3/8% senior notes due 2030 sank 3½ points.

They opened the day wrapped around 71 and proceeded to tumble, a source said.

The notes were trading in the 68¾ to 69 context heading into the market close, a source said.

The yield rose to about 14%.

There was $7 million in reported volume.

VistaJet’s 9½% senior notes due 2028 sank 2 points to an 80-handle.

The notes were trading in the 80 to 80½ context heading into the market close, a source said.

The yield rose to 15 7/8%.

There was $7 million in reported volume.

The notes were under pressure after the company reported disappointing earnings.

The numbers weren’t horrible, a source said.

However, EBITDA decreased with the company seemingly experiencing the same headwinds that have put other airlines in the cross-hairs of investors.

VistaJet will be hosting their conference call on Tuesday when guidance will be made available,

Altice rises

Altice’s capital structure continued to rise on Monday after Altice International posted better-than-expected earnings the previous week.

Altice France’s 5 1/8% senior notes due 2029 added to their strong gains the previous week although volume in the issue tempered.

The 5 1/8% notes were up another ½ point to close the day wrapped around 71, according to a market source.

The yield was about 12 3/8%.

The notes gained 1½ points last Wednesday after posting earnings.

They were trading on a 68-handle prior to their earnings report.

The positive momentum spilled over to Altice Financing’s 5¾% senior secured notes due 2029 which added ½ point in active trade.

The notes traded up to an 81-handle and were trading in the 81¼ to 81½ context heading into the market close.

The yield was 10%.

There was $14 million in reported volume.

Altice USA subsidiary CSC Holdings’ 11¼% senior guaranteed notes due 2028 also edged higher in active trade.

The 11¼% notes added about ¼ point to trade in the 99¼ to 99½ context, a source said.

There was $21 million in reported volume with the notes among the most actively traded issues in the secondary space.

The notes were on a 99-handle prior to Altice International’s earnings.

In addition to better-than-expected earnings, Altice France announced last week it had completed the sale of a 70% stake of its data centers to Morgan Stanely Investment Management for $586 million.

Fund flows

The dedicated high-yield bond funds sustained $207 million of net daily outflows on Friday, the most recent session for which data was available at press time, according to a market source.

Actively managed high-yield funds saw $149 million of outflows on the day.

High-yield ETFs sustained $58 million of outflows on Friday, according to the market source.

Indexes

The KDP High Yield Daily index was flat on Monday to close the day at 49.02 with the yield 7.55%.

The ICE BofAML US High Yield index added 21.3 basis points with the year-to-date return now 8.527%.

The CDX High Yield 30 index closed Monday at 103.65.

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