Gymboree, Toys ‘R’ Us bonds rise despite wider losses; Logan’s Roadhouse gives back gains

By Stephanie N. Rotondo

Phoenix, June 12 – The distressed debt market ended on the softer side Thursday, but some news-driven names managed to buck that trend.

Gymboree Corp. and Toys “R” Us Inc. reported earnings during the day. Though both companies reported a wider loss for the first fiscal quarter, their bonds actually managed to close in higher territory.

Gymboree bonds, for instance, were up as much as 4 points on the day, while Toys “R” Us put on as much as 5 points. For its part, Toys “R” Us did see a gain in same-store sales.

In another consumer-driven sector, Logan’s Roadhouse Inc.’s 10¾% notes due 2017 gave back some of the gains incurred at midweek.

A trader called the issue down half a point at 81¾. Paper had been up about that much the day before after the parent company, LRI Holdings Inc., released its earnings.

For the fiscal third quarter ended April 27, 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%.

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