Chesapeake falls after earnings report; Mallinckrodt mixed on earnings, exchange offers

By James McCandless

San Antonio, Nov. 5 – A new batch of names releasing earnings over the last 24 hours were the driving force of Tuesday activity in the distressed debt market.

Chesapeake Energy Corp.’s notes fell after reporting a loss for the third quarter and raising worries about its ability to exist as a going concern.

The 8% senior notes due 2027 dropped 7¼ points to close at 60¼ bid. The 8% senior notes due 2025 lost 6 points to close at 64 bid.

On Tuesday morning, the independent oil and gas producer was one of the many high-profile names to issue its earnings report in the last day.

The company reported a loss of 11 cents per share, slightly worse than the 10 cents per share loss that analysts were expecting.

Revenues were shown to be $1.17 billion.

Accompanying the report was a warning from the company that its continued operation as a going concern is at risk if low energy prices persist.

In the pharma space, Mallinckrodt plc’s notes varied after reporting positive earnings and exchange offers for two series of notes.

The 5¾% senior notes due 2022 dived 6 points to close at 34 bid. The 4 7/8% senior notes due 2020 picked up 3 points to close at 69 bid.

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