Logan’s Roadhouse loss widens, bonds dip; coal names trade all over the place; Caesars mixed

By Stephanie N. Rotondo

Phoenix, June 11 – The distressed debt market “was down a touch,” a trader said Wednesday.

However, he noted that there “weren’t any huge losers.”

The trader also said that new high-yield issues were taking precedence over distressed credits, as “hundreds of millions” of new deals priced Wednesday traded.

“New issues: It’s the only way to make money,” he said.

Of the day’s distressed dealings, Logan’s Roadhouse Inc. paper was slightly softer after the parent company, LRI Holdings Inc., released quarterly results.

“There was not a lot of price volatility relative to last quarter,” a trader remarked.

Elsewhere, coal names remained active, as did Caesars Entertainment Corp.

Logan’s slips post-earnings

A trader said Logan’s Roadhouse’s 10¾% notes due 2017 came in half a point following the company’s earnings release on Wednesday.

He pegged the issue around 82½.

Another trader said the paper was “pretty active, maybe a smidge lower.”

He placed the debt in an 82 to 82½ context.

For the fiscal third quarter ended April 27, parent company LRI Holdings reported net sales of $169.12 million, down 3.3% year over year. Net loss widened to $1.73 million from $515,000 the year before.

Adjusted EBITDA came to $17.24 million, versus $21.38 million the year before.

Comparable restaurant sales fell 3.2%, but the average check increased 3.9%. Customer traffic was down 6.8%.

The Nashville-based company will hold a conference call Thursday morning to discuss the results.

Meanwhile, Gymboree Corp.’s 9 1/8% notes due 2018 were “straddling” 67, according to a trader.

“That’s where they have been,” he said.

Another trader, however, said the issue was off half a point at 67.

The retailer is expected to report quarterly earnings on Thursday.

As for Claire’s Stores Inc.’s 8 7/8% notes due 2019, a trader said those notes gained slightly to close around 88¼.

Coal all over the place

The coal space finished the midweek session mixed.

One trader saw Arch Coal Inc.’s 9 7/8% notes due 2019 rising nearly a point to 86, on about $15 million bonds trading.

However, he said both the 7¼% notes due 2020 and the 7% notes due 2019 were down at 72¾ and 75, respectively.

Walter Energy Inc.’s 9 7/8% notes due 2020 meantime gained a point, closing around 60½.

In Alpha Natural Resources Inc.’s debt, a trader saw both the 6% notes due 2019 and the 6¼% notes due 2021 slipping to 72½ and 70½, respectively.

Another source called the 6¼% notes off a point at 70½ bid.

Caesars a mixed bag

Caesars’ bonds were also mixed in Wednesday trading.

One trader said the 8½% notes due 2020 fell a touch to 84¼, while the 9% notes due 2020 inched up slightly to 83¾.

He said the 10% notes due 2018 were unchanged at 41½.

But another trader said the debt was “all pretty much unchanged.”

He saw the 8½% notes trading around 84.

Caesars is a Las Vegas-based casino and hotel operator.

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