OPTI reports results, bonds fall; Harrahs debt moves up; NewPage busy, firm; Dynegy inches up

By Stephanie N. Rotondo

Portland, Ore., April 27 - A distressed debt trader said it was a "robust day" for the secondary space on Wednesday, with about $1.6 billion of bonds changing hands.

"It was kind of sideways," he added. "The market started softer, but then ended up a little bit."

However, that was not the case for OPTI Canada Inc., which announced its first-quarter results. Though the company posted a narrower loss, it also warned that production would likely not meet previous estimates. As a result, the company's bonds fell at least 2 points on the day.

Meanwhile, Caesars Entertainment Corp.'s debt moved up a bit, though on no fresh news.

Also active was NewPage Corp., but traders said the bonds were essentially unchanged.

And, Dynegy Inc.'s paper was "grinding higher," a trader said. Volume in the name, however, was thin.

OPTI off with numbers

OPTI Canada's debt dipped in Wednesday trading after the company released its quarterly results.

A trader said the subordinated paper - the 7 7/8% and 8¼% notes due 2014 - were "pretty active" on the back of the numbers and a "good conference call."

He said the issues were down 2 to 2½ points, trading with a 52 handle.

The senior issues, he continued, were about unchanged, the 9¾% notes due2013 around 101 and the 9% notes due 2012 around par.

"Basically, their whole thing is that there is always an excuse for not hitting their numbers," the trader said. "It's always plausible but at some point there can't always be something."

While the bonds "didn't get pounded ridiculously," the numbers and the call were "certainly not creating any warm fuzzy feelings."

Another trader called the bonds down a deuce on "crap numbers," placing the subs around 52 bid, 53 offered, down from 55. He also deemed the seniors unchanged around par.

A third source said the subs fell down to the high-40s, then "bounced back" to around 52, still down 2 points.

The Calgary, Alta.-based oilsands producer reported a narrower first-quarter loss of C$27 million, or 9 Canadian cents per share. In the previous year, net loss was C$41 million, or 15 Canadian cents per share.

Revenues gained 26% to C$63 million and bitumen production at its Long Lake joint venture with Nexen Inc. rose 36% to 25,5000 barrels per day.

Still, the company warned that it would likely not meet its annual production target.

Harrahs' bonds firm

Caesars Entertainment's 10% notes due 2018 were active but "not much different," a trader said.

He pegged the issue at 93 3/8, up a quarter-point.

Another trader said the bonds were "up marginally" at 931/4, on "good size." He said about $30 million to $40 million of the notes traded.

Another source deemed the issue up nearly a point at 931/2.

There was no fresh news out on the Las Vegas-based casino operator.

NewPage hanging on

NewPage trading picked up again during the midweek session, according to traders.

One trader said about "$25-odd million" of the 10% notes due 2012 changed hands, but were unchanged around 591/2.

Another trader agreed that the credit was "an active one." But he called the paper up a quarter-point at 591/2.

NewPage is a Miamisburg, Ohio-based coated papermaker.

Dynegy 'grinding higher'

A trader said Dynegy's debt "keeps grinding higher," though trading has been light of late.

He said the 8 3/8% notes due 2016 were at a "recent high" of 863/4, while the 7¾% notes due 2019 were trading around 771/2.

At another desk, the 7¾% notes were seen gaining nearly a point to close at 78 bid.

Dynegy is a Houston-based energy producer.

DirectBuy softens

A trader said that DirectBuy Holdings Inc.'s 12% notes due 2017 "had some activity today," seeing the bonds in a 55-57 context, though he later qualified that as "not a lot."

He said Wednesday's levels were down from Tuesday's trades between 56 and 58 bid, calling them down a half-point.

Paul Deckelman contributed to this article

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