Frontier mixed after unsuccessful asset auction; J.C. Penney mixed in aftermath of CEO departure

By James McCandless

San Antonio, May 25 – A short day for the distressed debt market beget sparse trading on Friday, market sources confirmed, at the outset of the long weekend.

Frontier Communications Corp. notes were mixed days after an unsuccessful auction for its Florida assets.

J.C. Penney Co., Inc. issues were also mixed in the aftermath of the surprise departure of the company’s chief executive officer.

Ensco plc bonds declined for a third day after the company declared its regular quarterly dividend for common stock on Tuesday.

Intelsat SA paper was mixed. Recently, the company released a disappointing Q1 report. PetSmart Inc. notes declined. On Monday, the company announced the appointment of a new CEO. In the pharmaceutical space, Mallinckrodt plc issues rose.

Frontier mixed

Norwalk, Conn.-based wireline name Frontier Communications’ notes were mixed, market sources confirmed, days after the company’s auction of its Florida assets did not produce bids that it considered satisfactory. The company intended to use the proceeds from the sale to help pay down its debt.

“Right now, this is a ‘wait and see’ scenario,” a trader said. “But they will have to make a move soon in order to retain confidence.”

The 7 5/8% notes due 2024 jumped up about 1¾ points to close at around 69¾ bid. The 10½% notes due 2022 shaved off about ¼ point to close at 89¾ bid. The 11% notes due 2025 gained ¾ point to close at 80¾ bid.

On Thursday, the 7 5/8% notes dropped ½ point, the 10½% notes lost about 1 point and the 11% notes fell about ¾ point.

J.C. Penney mixed

Plano, Texas-based department store chain J.C. Penney issues were mixed, traders confirmed. On Tuesday, the company announced that chief executive officer Marvin Ellison would be leaving the company to take the top position at Lowe’s Cos., Inc.

Last Thursday, the company released a lacking Q1 report, showing a 4.1% decrease in revenue year-over-year and a 22 cent loss per share.

The 7.4% bonds due 2037 lost about ¼ point to close at around 61¾ bid. The 8 5/8% notes due 2025 were level at 83¾ bid.

On Thursday, the 7.4% bonds gained about 1¾ points and the 8 5/8% notes lost 1¾ points.

Ensco falls

Britain-based oil and gas driller Ensco bonds fell for a third straight day, market sources confirmed. On Tuesday, the company declared its regular quarterly dividend of 1 cent per share of common stock.

The dividend will be payable on June 15.

The 5¾% bonds due 2044 traded down about ½ point to close at 71½ bid.

On Thursday, the 5¾% bonds dropped about 1¼ point.

Volume names trade

Luxembourg-based satellite communications company Intelsat paper was mixed. A recent Q1 report showed a 56 cents per share loss, falling short of analyst estimates of 41 cents per share.

The Intelsat (Luxembourg) SA 7¾% paper due 2021 was level at 81¾ bid. The 8 1/8% paper due 2023 lost about 1¼ points to close at around 74¼ bid.

Phoenix-based pet supplies retailer PetSmart issues declined. On Monday, the company appointed retail executive J.K. Symancyk as its new chief executive officer.

The 5 7/8% notes due 2025 fell ¼ point to close at 70 bid.

Britain based drug maker Mallinckrodt saw its 4¾% paper due 2023 edge up about ¼ point to close at around 80¼ bid.

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