Warner Chilcott better with numbers; Cinemark steady; Ford trades up; Pilgrim's nets orders

By Sara Rosenberg

New York, Aug. 7 - Warner Chilcott Ltd.'s term loan B was stronger on Friday as the company released quarterly results that showed improvements in net income and revenues, Cinemark Holdings Inc.'s term loan B held firm following its earnings news, and Ford Motor Co.'s term loan rose as the extension of the "cash for clunkers" program became official.

Over in the primary market, Pilgrim's Pride Corp.'s proposed exit financing credit facility has already received some commitments as the company is wrapping up the agent-round syndication on the deal, and the general round is scheduled to kick off shortly.

Warner Chilcott strengthens

Warner Chilcott's term loan B gained some ground during a quiet Friday trading session following the company's quarterly earnings announcement, according to a trader.

The term loan B was quoted at 98 bid, 99 offered, up form 97¼ bid, 98¼ offered, the trader said.

For the quarter ended June 30, the company had net income of $56 million, or $0.22 per diluted share, compared with net income of $33.6 million, or $0.13 per diluted share, in the prior year quarter.

Revenues for the quarter were $250.8 million, up 7.1% from $234.2 million last year.

And, as of June 30, cash and cash equivalents totaled $138.2 million and total debt outstanding was $859.8 million.

There were no borrowings outstanding under the company's revolving credit facility at June 30.

Warner Chilcott updates guidance

In addition on Friday, Warner Chilcott raised its guidance on gross margin as a percentage of total revenue to a range of 80% to 81% to reflect the current expectation that a favorable product mix will continue to benefit overall margins.

The company also updated its expected ranges for certain operating expense items for the full year. Total anticipated selling, general and administrative expenses continue to be in the range of $203 million to $212 million, as expected reductions in advertising and promotion expenses should offset expected increases in general and administrative expenses.

Specifically, advertising and promotion expenses are expected to be in the range of $38 million to $41 million and general and administrative expenses are expected to be in the range of $81 million to $84 million. Meanwhile, research and development spend is now expected to be in the range of $72 million to $75 million rather than $77 million to $80 million.

Based on the revisions, the company is now anticipating cash net income per share in the range of $1.60 to $1.65, $0.05 per share higher than previously forecasted.

Revenue guidance for the full year was reaffirmed in the range of $1.015 billion to $1.025 billion.

Warner Chilcott is a Rockaway, N.J.-based specialty pharmaceutical company currently focused on the women's healthcare and dermatology segments.

Cinemark stays firm

Also coming out with earnings on Friday was Cinemark, and after the announcement, the company's term loan B remained flat on the day with quotes seen at 96 bid, 97 offered, according to a trader.

For the second quarter, Cinemark reported net income of $18.7 million, or $0.17 per share, compared to net income of $15.5 million, or $0.14 per share, in the second quarter in the prior year.

Total revenues for the quarter were $517.5 million, up 13.2% from $457.2 million for the three months ended June 30, 2008.

And, adjusted EBITDA for the quarter increased 21% to $120.8 million from $99.8 million in the comparable period last year.

"Our strong start to the year accelerated during the second quarter as we benefited from a solid slate of films and outperformed the overall domestic industry box office results. In addition, our international attendance growth continues to outpace U.S. attendance growth," said Alan Stock, chief executive officer, in a news release.

Cinemark is a Plano, Texas-based motion picture exhibitor.

Ford posts gains

In more trading news, Ford's term loan moved higher as the "cash for clunkers" program extension and expansion was officially signed into law by President Obama after being approved by the Senate on Thursday, according to a trader.

The term loan was quoted at 88½ bid, 89¼ offered, up a point on the day, the trader said.

Under the law, people who trade in old cars for more efficient new cars will receive $3,500 to $4,500.

The program was increased to $3 billion from $1 billion and extended into Labor Day.

On Aug. 3, Ford came out with July sales numbers in which total sales were 165,279, up 2.3% from 161,530 in the comparable period last year.

The Dearborn, Mich.-based automaker said that customer demand for its fuel-efficient vehicles coupled with the U.S. government's Car Allowance Rebate System enabled it to post the first sales increase of any major manufacturer in 2009.

Pilgrim's Pride catches interest

Switching to new deal happenings, Pilgrim's Pride is in the process of finalizing the first round of syndication on its proposed $1.65 billion exit financing credit facility, which was for agent banks, and during the process, orders have come in towards the deal, according to a market source.

General syndication on the loan will start soon with the holding of a bank meeting on Wednesday in Dallas.

The facility consists of a $500 million three-year revolver talked at Libor plus 450 basis points, a $375 million three-year term loan A talked at Libor plus 500 bps and a $775 million five-year term loan B talked at Libor plus 500 bps, the source said. There is no Libor floor.

There will be upfront fees on all three tranches but the details on those fees have not yet been announced, the source continued.

Pilgrim's Pride B loan may see rollover

Pilgrim's Pride currently has an existing deal with CoBank, and the expectation is that the institutions involved in that deal will roll their commitments into the new term loan B, the source told Prospect News.

This expectation is based partly on the fact that the new term loan B has more investor friendly terms than the existing deal, the source explained.

The revolver, which is subject to a borrowing base, and the term loan A are being sold pro rata.

Financial covenants under the facility include leverage, fixed-charge coverage and capital expenditures requirements.

CoBank and Rabobank are the joint lead arrangers on the exit financing that is secured by the company's fixed and current assets.

Pilgrim's Pride is a Pittsburg, Texas-based poultry processor.

Ntelos closes

Ntelos Holdings Corp. closed on Friday on its new $670 million credit facility (Ba3/BB-) consisting of a $635 million six-year first-lien term loan and a $35 million revolver five-year revolver, according to a news release.

The term loan is priced at Libor plus 375 bps with a 2% Libor floor, and was sold to investors at an original issue discount of 99.

During syndication, the discount on the term loan was tightened from initial talk of 98½ as the deal was well received by investors.

Pricing on the revolver is Libor plus 350 bps.

Ntelos term loan covenants

Covenants under Ntelos' new term loan include a maximum leverage ratio of 4.0:1.0 and a maximum interest coverage ratio of 3.0:1.0.

JPMorgan and UBS acted as the joint lead arrangers and bookrunners on the deal that is being used to refinance and extend the maturity of the company's outstanding $603 million first-lien term loan due August 2011 and for general corporate purposes.

"Refinancing our existing term loan removes the market risk associated with our debt, which would have required significant repayments beginning in December 2010. We are especially pleased to have successfully closed on this reasonably priced new term loan in light of the turbulent credit markets the nation has been experiencing," said James S. Quarforth, chief executive officer, in the release.

Ntelos is a Waynesboro, Va.-based integrated communications provider.

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