Altice France bonds mixed, post some recovery; AMC moves lower in March; DISH edges down

By Cristal Cody

Tupelo, Miss., March 25 – AMC Entertainment Holdings, Inc.’s bonds traded slightly weaker on Monday and has softened about 1 point to 1½ points so far in March.

AMC’s 10% senior secured second-lien notes due 2026 (Caa3/CCC-) were down 3/8 point in light supply.

The company continues to carry a heavy debt load that overshadows its growth in market share and other revenue increases but is focused on raising funds to whittle down the debt, including unpopular stock sales that have deluded share value, Alicia Reese, an analyst with Wedbush Securities, Inc., told Prospect News on Monday.

AMC surprised investors and traders when it announced back in March 2022 that it paid $27.9 million in cash for a 22% stake of Hycroft Mining Holding Corp., which operates the 71,000-acre gold and silver Hycroft Mine in Nevada.

In a sense, AMC was “lending its experience to get a struggling company back on its feet, and one of the ways AMC was able to do that was by leveraging its retail shareholders and the interest they had at the time,” Reese said.

“At the moment, that wouldn’t work if AMC were to attempt that again because AMC has lost many of its retail shareholders, and many of those that remain don’t have the money or will to reinvest to expand their positions,” Reese said. “So what we have now is AMC trading at a fundamentally supported valuation versus previously trading at a significant premium supported by its retail shareholders.”

AMC raised over $865 million from equity sales in 2023 and said it will continue to do so as the box office slate remains depressed through the first half of 2024, according to a Wedbush note.

“AMC’s shareholders continue to resist AMC’s share repurchases, but AMC must cover its interest payments and leases while chipping away at the $3 billion in debt repayments coming due over the next three years while renegotiating the rest,” Reese said in the report.

AMC has $5 million of debt payments due in 2024, $98 million due in 2025, $2.9 billion due in 2026 and $525 million due in 2027, according to the note.

Fitch Ratings reported on Monday that some of its top market concern bonds have looming interest payments, including AMC Entertainment and DISH DBS Corp., both with debt payments due May 15.

DISH DBS’ bonds were quoted trading around ½ point lower on Monday.

The 7¾% senior notes due 2026 (Caa3/CC) went out at 68 bid, a source said.

Bonds in the television provider space have been under pressure in 2024.

Altice France Holding Restricted Group and related subsidiaries continued to dominate secondary action in the junk and distressed markets on Monday but bonds were mostly up on the upswing after shedding over 30 points last week.

The notes were trading around 1 point to 4 points higher to down ¼ point on reports that an ad hoc group of secured creditors increased its holdings.

Altice France Holding SA’s 10½% senior notes due 2027 (Caa2/CCC), down more than 35 points last week, recovered 4 points on Monday.

The leveraged loan TTM default rate ended February at 3.7%, up from 3.4% in January, in the fifth consecutive month of rising loan default rates, while the high-yield TTM default rate was 3.04%, up from 2.79% at the end of January, Fitch said Monday.

Stock indices ended the session mostly lower. The S&P 500 index fell 0.31%.

The iShares iBoxx High Yield Corporate Bond ETF dropped 10 cents, 0.14%, to $77.60.

The CBOE Volatility index increased 1% to 13.19.

AMC slightly lower

AMC’s 7½% senior secured first-lien notes due 2029 (Caa1/B-) traded near 68¼ bid with a 17.42% yield on $6 million of volume on Monday, a source said after the close.

AMC’s 10% senior secured second-lien notes due 2026 (Caa3/CCC-) were down 3/8 point at 77¾ bid with a 23.39% yield on just $1 million of trading supply by the end of the session.

AMC’s paper has softened about 1 point to 1½ points so far in March.

The company in February reported higher fourth-quarter and fiscal 2023 revenue and improved net losses.

The Leawood, Kan.-based movie theater company’s stock (NYSE: AMC) closed Monday up 1 cent, or 0.25%, to $4.09.

Altice paper mixed

Altice’s notes were trading around 1 point to 4 points higher to down ¼ point on Monday on reports that an ad hoc group of secured creditors increased its holdings to $12 billion, a source said.

Altice France’s 10½% senior notes due 2027 (Caa2/CCC) recovered 4 points to a quote of 42 bid with a 48% yield on $42 million of bonds traded.

The issue gave back 35½ points in the prior three sessions as concerns engulfed the company following Altice France’s earnings report on Wednesday and market chatter the company hired financial and legal advisers.

The bonds were yielding over 53% on Friday on $56 million of reported secondary volume.

Altice France’s 6% senior notes due 2028 (Caa2/CCC) remained soft and went out down ¼ point at 29¾ bid with a 46.86% yield on $10 million of volume on Monday.

The 6% notes have shed more than 32 points since Wednesday.

Meanwhile, Altice France’s 5 1/8% notes due 2029 also were 3 points to 4 points higher on Monday on $18 million of volume.

The issue was last seen at 72¼ bid with a 12.43% yield on $14 million of secondary trading.

Distressed index soft

S&P U.S. High Yield Corporate Distressed Bond index one-day total returns improved on Friday but remained soft at minus 0.23%.

Returns were negative 1.39% on Thursday, 0.06% on Wednesday, 0.19% on Tuesday and minus 0.13% at the start of the prior week.

Month-to-date total returns eased to minus 0.15% on Friday versus 0.09% on Thursday, 1.49% on Wednesday, 1.44% on Tuesday and 1.24% at the week’s start.

Year-to-date total returns declined to 2.47% at the close of the week, down from 2.71% on Thursday, 4.15% midweek, 4.09% on Tuesday and 3.89% at the beginning of the week.

© 2015 Prospect News.
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