Shares of the company, the third-largest manufacturer of glass bottles and jars in the country, fell 64 cents, or 52 percent, to 60 cents in morning trading on the Nasdaq Stock Market.The shares set a 52-week low of $1.14 on May 20. Last July the shares traded at $15.50.
Blaming poor financial results for May and June of this year, the Tampa, Fla., based company said late Monday that it might not be in compliance with two revolving credit agreements as well as its capital leases.
Anchor Glass warned that it may not be able to pay the $19.2 million of interest due Aug. 15 on its on its $350 million of 11 percent senior secured notes due 2013.
Those 11 percent notes tumbled 9.50 cents early Tuesday in active trading to 63 cents on the dollar, according to MarketAxess, an electronic trading service for corporate bonds.
The company said it's in preliminary discussions concerning a possible capital injection. It also said it's exploring other alternatives, including a debt restructuring or bankruptcy.
It also announced that its audit committee was reviewing $4.5 million of customer payments recorded as income to determine if the accounting was proper. Because of the review, it may not file its financial report for the second quarter on time.
Anchor Glass attributed its poor results in the previous two months to weak sales and higher costs for energy, soda ash and other raw materials, and freight. As a result, the company "has been unable to improve its profitability or liquidity during the second quarter as had been anticipated."
Anchor Glass had total debt outstanding of about $491 million at March 31, according to credit rating agency Standard & Poor's, which last month downgraded the company's corporate credit rating a notch to triple-C and placed the company on CreditWatch for further downgrade.