Sears notes mixed before long-delayed earnings released; Intelsat issues continue mixed during tender offer

By James McCandless

San Antonio, Sept. 13 – Trading in the distressed debt market on Wednesday continued to shine a spotlight on news-driven names.

Sears Holdings Corp.’s notes traded mixed as the company again delayed the release of its second-quarter report until after the market close Thursday.

The company reported a Q2 loss of $4.68 per share, widening from a loss of $2.33 per share in the second quarter of 2017.

Intelsat SA’s issues were mixed another day as a subsidiary works through a cash tender offer that began Monday.

Community Choice Financial Inc.’s paper fell again. On Friday, the company received $45 million in new financing.

Frontier Communications Corp.’s notes rose for a second day. A recent second-quarter report disappointed analysts and triggered a ratings downgrade.

Sanchez Energy Corp.’s declined, tracking oil futures.

In the medical space, Mallinckrodt plc’s paper gained.

Sears mixed

Sears’ notes traded mixed Thursday, traders said.

The 6 5/8% notes due 2018 rose about ¾ point to close at around 92 bid. The 8% notes due 2019 lost 3 points to close at 39½ bid.

The notes became active as Sears once again delayed the release of its second-quarter earnings report, which the market had been anticipating for weeks before the company released it after market close Thursday.

The company reported a loss of $4.68 per share, widening from a loss of $2.33 per share in the second quarter of 2017.

“I’m not sure why they’ve been kicking the can down the road,” a trader said before the release. “It’s not exactly going to be surprising whenever they report whatever losses they have.”

Sears is a Hoffman Estates, Ill.-based department store chain.

Intelsat also mixed

In distressed telecom trading, Intelsat’s issues were mixed again, market sources said.

The Intelsat Jackson Holdings SA 5½% notes due 2023 shed about ½ point to close at around 90½ bid. The Intelsat (Luxembourg) SA 8 1/8% notes due 2023 rose about 2¼ points to close at around 87½ bid.

On Wednesday, the 5½% notes gained about ¼ point and the 8 1/8% notes lost ½ point.

On Friday, subsidiary Intelsat Jackson priced $2.25 billion of six-year senior notes and also announced plans for the tender offer.

Last Wednesday, the subsidiary priced $2.25 billion of six-year senior notes and also announced the tender offer, which was tied to the issuance of new notes.

Intelsat is a Luxembourg-based satellite communications company.

Community Choice down

Elsewhere, Community Choice’s paper continued a negative streak, traders said.

The 10¾% notes due 2019 lost ¾ point to close at 80¼ bid.

On Wednesday, the 10¾% notes lost ½ point.

Late last Friday, the company announced a new $45 million revolving credit facility. The terms of the financing require an exchange of two-thirds of the company’s 10¾% senior secured notes due May 1, 2019 and its 12¾% senior secured notes due May 1, 2020 for equity by Nov. 30.

Last week, a subsidiary priced a $42 million offering of first-lien senior secured notes due 2020.

Community Choice is a Dublin, Ohio-based alternative financial services company.

Volume names trade

Elsewhere in telecom trading, Frontier Communications’ notes rose.

The 7 5/8% notes due 2024 picked up about 1 point to close at around 64½ bid. The 10½% notes due 2022 added about 1¾ points to close at 89¾ bid. The 11% notes due 2025 gained about 1 point to close at 79½ bid.

A recent negative second-quarter earnings report led to Standard & Poor’s issuing a downgrade of its issuer credit rating, senior unsecured debt rating and affirming a negative outlook.

Houston-based independent oil and gas producer Sanchez Energy’s issues declined, continuing to trend whichever way oil futures trade.

The 6 1/8% notes due 2023 lost about 1 point to close at 53¾ bid.

Staines-upon-Thames, U.K.-based drug maker Mallinckrodt’s paper rose in the medical space.

The 4¾% paper due 2023 gained about ½ point to close at around 87 bid.

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