NII Capital takes dive as forecast disappoints; Caesars notes drifting down again; Arch slips

By Stephanie N. Rotondo

Phoenix, Feb. 5 - A flurry of news was driving distressed names around during Tuesday trading, mostly to the downside.

NII Capital Corp. was the day's big loser after the company released preliminary financial forecasts that were worse than expected. The company's debt dropped at least 5 points on that news.

Caesars Entertainment Corp. also put out preliminary figures late on Monday. Those numbers failed to excite investors as well. However, losses seen in the bonds on Tuesday could have also been due to people jockeying portfolios around to make room for a $1.5 billion add-on issue that priced Monday.

And, a wider quarterly loss put pressure on Arch Coal Inc.'s debt, though the decline was a modest one.

NII Capital takes beating

NII Capital's debt took a big hit Tuesday after the company released a revenue forecast for 2013 that was disappointing.

A trader called the 7 5/8% notes due 2021 down nearly 7 points at 701/2, while the 10% notes due 2016 were off 5 points at 92.

The Reston, Va.-based provider of telecommunications in Latin America said it expected to see revenues of $5.7 billion to $5.9 billion. Analysts polled by Bloomberg were expecting an average of $6.1 billion.

The company also said that it was launching an offering of $400 million bonds due 2019. Proceeds from the offering will be used for general corporate purposes, which may include network expansions and upgrades.

Caesars slashed again

Caesars Entertainment's 10% notes due 2018 continued to leak in Tuesday trading.

One trader called the issue down nearly 2 points at 66 5/8.

Another market source placed the issue at 66¾ bid, down almost 3 points.

The issue has been on the softer side for the last week. A new $1.5 billion add-on to its 9% notes due 2020 was given credit for losses obtained on Monday - when the add-on priced - and could have been the culprit on Tuesday as well, as investors moved their portfolios around.

But the Las Vegas-based casino operator also released a fourth-quarter outlook late Monday that failed to excite market players.

The company is expecting to see net revenues of $1.55 billion to $1.58 billion, excluding its Harrah's St. Louis property. Net loss was forecast between $452 million and $556 million.

Caesars reported a net loss of $246.9 million for the fourth quarter of 2011.

Arch slips on weak earnings

A trader saw Arch Coal's 7¼% notes due 2021 slipping modestly after the company reported a wider than expected quarterly loss.

The trader pegged the issue around 881/2.

For the fourth quarter, the St. Louis-based coal producer posted a net loss of $295.4 million, or $1.39 per share.

That compared to a profit of $70.9 million, or 33 cents per share, the year before.

Revenue dropped to $968.2 million from $1.23 billion the previous year. Analysts had been expecting revenue on average of $1.01 billion.

DIP news impacts ATP, OSG

In other distressed and topical names, ATP Oil & Gas Corp.'s 11 7/8% notes due 2015 fell to 3 bid, 3½ offered from previous levels around 4 on Monday.

Late Friday, the Houston-based bankrupt oil and gas exploration company sought approval for additional debtor-in-possession funding. On Tuesday, the case's unsecured creditors group was strenuously objecting to the amendment.

Meanwhile, Overseas Shipholding Group Inc.'s 8 1/8% notes due 2018 rose to 39 bid, 39½ offered from 38¾ bid, 39 offered on Monday. The gains came as the company asked the bankruptcy court overseeing its case approved two DIP facilities.

© 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.