Billionaire’s Junk TV Bonds Are Getting a Boost From Soccer Fans

  • TV Azteca’s dollar notes have climbed to an eight-month high
  • Company said soccer games boosted viewership and earnings

Billionaire Ricardo Salinas’s struggling broadcaster TV Azteca SAB is finally giving its bondholders a reason to hope.

The Mexico City-based company’s $500 million of notes due in 2020 have jumped 12 percent to an eight-month high since July 22. That’s when TV Azteca reported second-quarter earnings before items jumped 144 percent as soccer tournaments in Europe and Latin America increased viewership. TV Azteca also got a boost from Peru, where the government reimbursed the broadcaster for building and operating a fiber-optic network. 

While the maker of soap operas, news and reality shows still posted its sixth straight loss, the improved earnings are fueling optimism the company may be starting to turn things around. Salinas appointed his son Benjamin Salinas as CEO last year to pull TV Azteca out of its slide, a move that at the time disappointed bond investors. The Mexico City-based company is facing falling advertising revenue as pay-television services lure viewers away.

“It’s not a one-off, but they’re starting from a low base,” said Araceli Espinosa, an analyst at Actinver in Mexico City. “My sense is that their operating performance has touched bottom and will start to slowly improve.”

TV Azteca’s bonds have returned 5.7 percent since July 22, the most among Mexican companies.

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