Energy XXI mixed post-earnings; SandRidge rises; MolyCorp posts wider loss, bonds end steady

By Stephanie N. Rotondo

Phoenix, May 7 – Distressed debt energy names were moving around Thursday, as activity was spurred by earnings news.

After releasing earnings late Wednesday, Energy XXI bonds were trading mixed. SandRidge Energy Inc. also came out with numbers Wednesday and though those bonds were initially weaker, they finished with a firmer tone.

MolyCorp Inc. meantime announced its earnings early Thursday, but despite a wider loss, the debt ended steady.

Away from commodities, Advanced Micro Devices Inc. was heading higher following the company’s financial analyst day on Wednesday. During its presentation, the company laid out its new strategy to return to profitability in the second half of 2015.

Energy XXI mixed

Houston-based oil and gas company Energy XXI reported its fiscal third-quarter results late Wednesday, missing estimates.

But the company’s debt was unchanged despite the earnings miss.

A trader saw the 7½% notes due 2021 and 2023 were unchanged at 42 and 50, according to a trader. But the 8¼% notes due 2018 fell 1¼ points to 77 1/8, while the 11% notes due 2020 rose almost half a point to 96 3/8.

For the quarter, Energy XXI posted a net loss of $587.2 million, or $6.22 per share. On an adjusted basis, the loss was $102.3 million, or $1.08 per share.

Revenue was $260.2 million.

Analysts polled by Thomson Reuters expected an adjusted loss per share of $1.01, on revenue of $270.9 million.

Production improved by 2,100 BOE/d during the quarter.

The company ended the quarter with $725 million of liquidity.

SandRidge pushes up

Oklahoma City-based SandRidge Energy also came out with earnings late Wednesday.

In addition to seeing a 36% gain in total production for the quarter, SandRidge reported adjusted EBITDA of $182 million, up from $169 million the year before. Adjusted earnings came to $2.3 million, versus $29.5 million the year before.

Still, total net loss surged to over $1 billion. That compared to a loss of $136.34 million the year before.

Though the bonds initially traded lower come Thursday, they finished the session with a firmer tone.

A trader saw the 7½% notes due 2021 inched up a touch to 74 1/8, while the 7½% notes due 2023 improved nearly a point to 72 5/8.

He also saw the 8 1/8% notes due 2022 at 73¼, up 1½ points on the day.

Another market source placed the 2021 paper at 74¼ bid, up a quarter point.

MolyCorp holds steady

A trader said MolyCorp’s 10% notes due 2020 “were a little more active,” trading in a 49 to 50 context.

Another trader placed the issue around 50, noting that the paper had gotten as low as 49 but recovered.

He deemed the issue “pretty much unchanged.”

For the first quarter, the Greenwood, Colo.-based rare earth metals mining company reported a net loss of $102.3 million, or 42 cents per share. That compared to a loss of $86.1 million, or 40 cents per share, the year before.

On an adjusted basis, the loss per share was 28 cents.

Revenue declined over 10% to $106.4 million.

During the quarter, average selling prices declined 8% to $30.97 per kilogram, which partially accounted for the wider loss.

The loss was also attributed in part to inventory writedowns.

Cash flows for the month were negative at $73 million.

Cash and equivalents came to $133.6 million, down from $211.7 million the previous quarter.

MolyCorp has been in the process of restructuring its debt and said in its earnings report that it would conduct a significant debt-for-equity exchange.

AMD paper improves

Advanced Micro Devices, the struggling Sunnyvale, Calif.-based chipmaker, held an analyst day on Wednesday, its first since 2012.

During its presentation, AMD executives laid out its new strategy to return to profitability, which will include paring down to focus on fewer products.

Investors appeared to be pleased with what they heard and pushed the bonds into higher territory come Thursday.

A trader deemed the 7¾% notes due 2020 up 3 points at 84 7/8. The 6¾% notes due 2019 ended half a point better at 88, as the 7% notes due 2024 rose 1¼ points to 80¼.

For 2014, AMD posted a loss of $403 million, or 53 cents per share, on revenue of $5.5 billion. The company said it was aiming to reach long-term annual earnings of 50 cents per share.

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