Frontier mixed amid ratings downgrade; Intelsat also mixed after subsidiary brings new issue

By James McCandless

San Antonio, Aug. 3 – The week in the distressed debt market ended with volume remaining fixed on names releasing earnings statements.

Frontier Communications Corp. notes were mixed as Standard & Poor’s issued a ratings downgrade.

Intelsat SA issues were also mixed. On Thursday, a subsidiary priced a $1.25 billion offering of senior notes.

Bristow Group Inc. paper declined. The company posted a disappointing earnings report on Thursday.

California Resources Corp. notes were level. The company released its Q2 earnings report after market close Thursday.

Diebold Nixdorf, Inc. issues improved after surprising analysts with a discouraging earnings report on Wednesday.

American Tire Distributors notes rose again as the company works on its reorganization strategy to generate new business.

Frontier mixed

Norwalk, Conn.-based wireline communications name Frontier Communications notes were mixed, traders confirmed, amid an S&P ratings downgrade. The agency lowered its issuer credit rating, senior unsecured debt rating and affirmed a negative outlook (see related story elsewhere in this issue).

On Tuesday, the company posted its Q2 earnings report, missing analyst estimates of a 72 cents per share loss with an 80 cents per share loss. It also reported a net loss of $18 million.

“The week hasn’t really been good for them,” a trader said. “There’s not a lot of positivity to pick out.”

The 7 5/8% notes due 2024 rose about ¼ point to close at around 68¾ bid. The 10½% notes due 2022 shaved off about ¼ point to close at around 90 bid. The 11% notes due 2025 lost about 1 point to close at around 81¼ bid.

On Thursday, the 7 5/8% notes were level, the 10½% notes were level and the 11% notes rose about 2 points.

Intelsat mixed

Elsewhere in distressed telecom, Luxembourg-based satellite communications company Intelsat issued also ended mixed, market sources confirmed. On Thursday, subsidiary Intelsat Connect Finance SA priced a $1.25 billion offering of senior notes due 2023.

On Tuesday, the company released its Q2 earnings report, showing a 38 cents per share loss against analyst estimates of a 37 cents per share loss. It also reported $537.71 million in revenues.

The Intelsat (Luxembourg) SA 7¾% notes due 2021 traded up about ¼ point to close at around 96¾ bid. The 8 1/8% notes due 2023 lost about ½ point to close at 88 bid.

On Thursday, the 7¾% notes added ¼ point and the 8 1/8% notes rose about 1 point.

Bristow off

Houston-based offshore transportation name Bristow Group paper declined, traders confirmed, as the market reacts to the company’s Q2 report posted after hours Thursday. The company showed an 82 cents per share loss against analyst estimates of a 72 cents per share loss. It also outperformed revenue estimates at $367.89 million.

The 6¼% paper due 2022 dove about 1¾ points to close at 75 bid.

On Thursday, the 6¼% paper gained about ¼ point.

Volume names trade

Los Angeles-based independent oil and gas producer California Resources notes ended the week level. After market close Thursday, company showed a 29 cents per share loss in its Q2 earnings report, besting analyst expectations of a 43 cents per share loss.

The 8% notes due 2022 were level at about 90 bid.

On Thursday, the 8% notes rose ½ point.

North Canton, Ohio-based connected commerce solutions company Diebold issues improved after a precipitous two-day decline. On Wednesday, the company released its Q2 earnings report, falling below analyst expectations of a 1 cent per share loss with a 21 cents per share loss. The company is in talks with lenders about amending its credit agreement.

The 8.5% notes due 2024 gained about ½ point to close at around 80 bid.

The 8.5% notes lost about ¾ point on Thursday and cratered about 13¾ points on Wednesday.

Huntersville, N.C.-based tire distributor American Tire paper rose. The company is in talks with bondholders as it tries to procure new business to replace the lost distribution deals with Bridgestone and Goodyear.

The 10¼% paper due 2022 added about ½ point to close at around 41½ bid.

On Thursday, the 10 ¼% paper rose 1 point.

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