Kmart Continues To Drop On Weak Results

  • 29 Sep 2002
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Levels for Kmart's bank debt continued to plummet after the company released second quarter financial results on Sept. 16. Traders quoted the paper in the 27-31 range last week, down from a wide bid-ask spread of 30-40 two weeks ago, and one dealer noted that a small piece of the company's bank debt had traded around the 28 level.

Kmart announced a net loss of $333 million in the second quarter of 2002, excluding non-comparable items, discontinued operations and reorganization items. The company also said that its net sales for the 13-week period ending July 31, 2002 decreased by more than 15% compared to last year. At the end of August, however, Kmart still had $830 million in cash and full availability under its $1.5 billion debtor-in-possession credit facility. Calls to Albert Koch, cfo, were referred to a spokesman, who did not return calls by press time.

Kmart's bank debt began dropping after the company filed a motion to amend its DIP facility in mid-August. Previously, the paper had settled into the 60s.

  • 29 Sep 2002

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1 BNP Paribas 13,295 25 18.56
2 Bank of America Merrill Lynch (BAML) 8,059 25 11.25
3 Lloyds Bank 6,979 21 9.74
4 Citi 6,256 16 8.73
5 JP Morgan 5,220 8 7.29

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