Quiksilver bonds, stock take dive as earnings miss; distressed space ends week mostly soft

By Stephanie N. Rotondo

Phoenix, Sept. 5 – Apparel company Quiksilver Inc. was the notable name of the day in Friday’s distressed debt market, as investors reacted to the company’s poor third-quarter results.

A trader said the 10% senior notes due 2020 ended the day at 63, after opening at 53 and trading as high as 67. He noted that the issue “hadn’t traded in the last two to three weeks,” seeing the paper previously trade on Aug. 14 at 80.

But the 7 7/8% senior secured notes due 2018 finished the session up 4 points at 92¾.

The company’s stock (NYSE: ZQK) also got hammered, falling 70 cents, or 24.73%, to $2.13.

The Huntington Beach, Calif.-based company released its earnings late Thursday.

For the quarter ended July 31, Quiksilver posted a net loss of $220.1 million, or $1.29 per share. That compared to a profit of $2.1 million the year before.

In the rest of the distressed space, most names remained under pressure.

For their part, both NII Holdings Inc. and Caesars Entertainment Corp. were mixed on the day.

Getty Images Inc.’s 7% notes due 2020 were meantime a point weaker at 82, according to a trader.

And, Ukrainian poultry producer MHP SA saw its 8¼% notes due 2020 inching up slightly to 86½.

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