By Stephanie N. Rotondo
Phoenix, Sept. 30 – The convertible bond market was looking to rebound going into month-end trading after spending the beginning of the week on a slide.
“Everything is up today,” a trader said. “Everything is green – marginally. Nothing looks like it’s motoring [up].”
The trader added that while the tone was positive, volume was muted.
Still, some names were ending with a weaker tone.
SunEdison Inc.’s paper remained active but continued to retreat. A trader said that all of the company’s convertible issues were trading, though the 0.25% convertible notes due 2020 – a Rule 144A deal – was the most active.
He saw the paper trading in a range of 57 to 58.25, which compared to 58.5 to 60 on Tuesday.
“I’m looking at the trades; they are all sales,” the trader said. “People are bailing out.”
Another market source saw the bonds closing off even further to around 55.5.
While the bonds were weak, the stock underlying the notes was up, rising 52 cents, or 7.81%, to $7.18.
Energy XXI Ltd.’s 3% convertible notes due 2018 were also a touch softer, according to a source.
The source placed the bonds in a 9.25 to 9.5 context, a level that was echoed at another desk.
The equity improved, however, rising a dime, or 10.31%, to $1.05.
The weakness in the Houston-based oil and gas producer’s debt came after the company reported its fiscal fourth-quarter and year-end results late Tuesday.
For the quarter, Energy XXI reported adjusted EBITDA of $121.8 million on revenue of $219.5 million. That compared to adjusted EBITDA of $184.1 million on revenues of $301.3 million the year before.
For the year, adjusted EBITDA came to $760.5 million, versus $729.7 million the previous year. Net loss was $2.4 billion, or $25.97 per share.
The company had posted a profit the year before.
Revenue for the year was $1.4 billion, up from $1.2 billion.
The company noted that its production rates were stable and cost control efforts appeared to be having a positive impact.
One such effort was the repurchasing of bonds. To date, Energy XXI has bought back over $425 million of debt, the company said in a press release, reducing annual interest expense by over $32 million.
In its conference call, management said it was aiming to buy back up to $1 billion of bonds.
Available liquidity at the end of the year was $679 million.
Going into fiscal 2016, the company said it expected its capital expenditure costs to be between $130 million and $150 million.
Nvidia improves
Nvidia Corp.’s 1% notes due 2018 were inching up, adding nearly a point to trade north of 131, according to a trader.
A second source placed that issue at 131.75, up about 5 points outright.
That was against a stock price of $24.64, which was a nearly 4% gain on the day.
The company announced a new cloud-powered gaming service on Wednesday that is hoped to become the Netflix of the streaming gaming world. Additionally, an Nvidia/Microsoft collaboration was announced, in which users of Microsoft’s Azure would be offered Nvidia GPU-enable applications and accelerated graphics.
Mentioned in this article:
SunEdison Inc. NYSE: SUNE
| Nvidia Corp: | Nasdaq: NVDA
|
| Energy XXI Ltd. | Nasdaq: EXXI
|
© 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.
