Bonanza Creek bonds fall amid weak earnings, pulled sales; Cobalt retreats; Intelsat firm

By Stephanie N. Rotondo

Seattle, Aug. 2 – The distressed energy arena continued to be front and center on Tuesday, as more sector earnings were released and oil prices remained under pressure.

Domestic crude dropped below $40 for the first time since April, as investors prepared to see higher-than-normal stockpiles during the summer driving season in the U.S. Energy Information Administration’s weekly report.

Bonanza Creek Energy Inc. was in the news, having said on Monday that its ability to continue as a going concern was in “substantial doubt.” The company also reported weak quarterly results.

The bonds dropped 3 to 4 points in response.

Cobalt International Energy Inc.’s convertible debt was meantime weaker in the wake of its own earnings release, which also came with a handful of bad news.

In addition to posting a wider loss for the quarter, Cobalt also noted that a sale of its Angola blocks had hit a snag.

Also in the energy genre, Peabody Energy Corp. bonds continued to gain momentum.

The bonds “have been on a nice run,” a trader said, seeing the bankrupt coal producer’s 10% notes due 2022 gaining a deuce to close at 19¾.

Elsewhere in the world of distressed bonds, traders reported that Intelsat SA paper remained on an upward trajectory.

“Intelsat continues to be active,” a trader said, pegging the 8% notes due 2024 at 97.

He called that up half a point to a point on the day.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.