AMC bonds mixed ahead of earnings; Bausch paper active; Carvana mostly up; Lumen lower

By Cristal Cody

Tupelo, Miss., Feb. 27 – AMC Entertainment Holdings, Inc.’s paper moved sideways in heavy trading ahead of the company’s fourth-quarter earnings report due Tuesday.

The 7½% senior secured first-lien notes due 2029 (Caa1/B-) rose 5/8 point, while the 10% senior secured second-lien notes due 2026 (Caa3/CCC-) fell more than 1¾ points on more than $21 million of volume.

Bausch Health Cos. Inc. was also one of the day’s most active distressed names, a market source reported.

The company’s notes were mixed with the tranche of 4 7/8% notes due 2028 (Caa1/B-) up more than ¼ point on more than $15 million of paper changing hands.

Risk-on tone was stronger over the session with volatility lower.

The iShares iBoxx High Yield Corporate Bond ETF improved 50 cents, or 0.6%, to $74.67.

The CBOE Volatility index declined 3.32% to $20.95.

Carvana Co.’s distressed paper mostly improved in light trading on Monday after going into the weekend mixed on the heels of a report of losses.

Carvana’s 4 7/8% senior notes due 2029 (Caa2/CCC), which were down ½ point on Friday, climbed 4 points.

Lumen Technologies, Inc.’s 6 7/8% series G debentures due 2028 (Caa1/B) lost 1 point in active trading that totaled more than $8 million following a downgrade on Friday in the issuer’s bonds.

AMC paper active

Notes from AMC Entertainment were one of the most active junk and distressed names seen in the secondary market on Monday, a source said.

The 7½% senior secured first-lien notes due 2029 (Caa1/B-) rose 5/8 point to 60 7/8 bid on $12.75 million of trading action.

The company’s 10% senior secured second-lien notes due 2026 (Caa3/CCC-) slipped more than 1¾ points to trade at the 52 bid area on $9.13 million of volume.

AMC will report fourth-quarter and fiscal 2022 earnings results after the market closes on Tuesday.

The company’s stock closed Monday up 22.74% at $7.61.

The Leawood, Kan.-based movie theater owner completed a distressed debt-for-equity swap earlier this month.

AMC reported that on Feb. 7 it issued preferred equity units for $75.1 million to an investor and simultaneously purchased $100 million of its 10½% cash/PIK toggle second-lien notes due 2026 in exchange for its preferred equity units and cash.

The company said that it has repurchased $85.2 million of outstanding debt since Dec. 19 at an average discount of approximately 49%.

Bausch notes mixed

Bausch Health’s 4 7/8% notes due 2028 (Caa1/B-) traded up more than ¼ point to hit 62¼ bid during the session, a source said.

The bonds saw strong secondary supply with more than $15 million of paper changing hands.

The company’s 5% notes due 2028 (Ca/D) shed 1 point to head out at 43½ bid on light volume totaling $2 million.

Bausch’s paper was little changed on Friday after S&P Global Ratings downgraded the issuer to SD from CCC+ following the company’s announcement that it repurchased about $446 million of senior secured and senior notes for $250 million of cash in the fourth quarter.

Bondholders received 47 cents to 68 cents on the dollar, depending on the tranche, S&P said.

The Laval, Quebec-based pharmaceutical company on Thursday reported fourth-quarter and fiscal 2022 losses.

Carvana mostly higher

Carvana’s 4 7/8% senior notes due 2029 (Caa2/CCC) climbed 4 points on Monday to go out at 46¾ bid, a source said. Trading supply was light at $3 million.

The issue was last seen on Friday down ½ point at 43 bid on $9.3 million of volume.

Carvana’s 5 5/8% senior notes due 2025 (Caa2/CCC) also improved 1¾ points on Monday to 59½ bid on $3 million of trading.

Meanwhile, the company’s 5½% senior notes due 2027 (Caa2/CCC) slipped 1½ points to a quote of 46 bid on $1 million of trading.

The Phoenix-based online car retailer on Thursday reported heavy fourth-quarter and fiscal 2022 losses.

Lumen trades down

Also Monday, Lumen’s 6 7/8% debentures due 2028 (Caa1/B) softened 1 point to trade with a 62 bid handle, a source said.

Secondary supply totaled $8.75 million in the issue.

The Denver-based telecommunications company’s bonds have been mostly weaker over the back half of February.

Moody’s Investors Service said Friday it downgraded the issuer based on the company’s governance weaknesses. In addition, Lumen has debt that starts to mature in January 2025 with more than $9 billion of debt due in 2027.

Lumen’s credit default swap spreads widened nearly 100 basis points in the prior week.

Distressed returns dip

S&P U.S. High Yield Corporate Distressed Bond index one-day returns ended Friday at minus 0.26%, down from 0.82% on Thursday, 0.03% on Wednesday and minus 0.91% on Tuesday in the holiday week’s first session.

Month-to-date returns were 0.17% on Friday, compared to 0.44% on Thursday, minus 0.38% on Wednesday and minus 0.41% on Tuesday.

Quarterly and year-to-date total returns were 8.18% at the end of the week versus 8.46% on Thursday, 7.58% on Wednesday and 7.54% on Tuesday.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.