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With military budgets being slashed across the world, the defence groups have – rather unsurprisingly – not been having a great time of it lately. For BAE Systems, 2011 has been particularly tough, and its share price has dropped nearly 15% since the start of the year. The issue of government spending will certainly continue to weigh on the stock for the short-term. However, the battering its share price has taken – combined with the confidence shown by management with the share buyback – suggests upside ahead, if you are prepared to wait, the Independent says.

Publishing and exhibitions business, Reed Elsevier’s full-year results in February were pretty flat, indicating that further recovery would be gradual. First-half figures confirm this. The shares sell on an unexciting 12 times this year’s earnings — although as one analyst pointed out, their defensive qualities have some attractions in these markets. Hold, the Times says.

29th July 2011 Analyst: Philip Morrish Email: philip.morrish@gecr.co.uk Tel: 020 7562 3362 @UK - Good Interim Results; Re-iterate Buy Recommendation ...................................INTERIM RESULTS In light of these good results and because demand has been maintained into the second half, we remain comfortable with our current forecasts for this year and next. Therefore, we believe that it is not unreasonable to continue to value the company on demanding 2012 EV/Sales and EV/EBITDA multiples of 5 times and 20 times respectively because of the company's current stage of development. Our confidence is further supported by the quality of the group's established business relationships, such as Barclaycard Commercial, Google, NHS Shared Business Services, etc. but also because of the on time and in budget delivery of the flagship e-commerce GeM platform. Therefore, with the shares trading at 9.125p, and a 30p target price based upon our probably conservative 2012 expectations, we re-iterate our recommendation of buy.

Shares in UBM rose by nearly 6% on Friday after it announced a 9.1% rise in first-half sales, a 5% jump in the interim dividend and the acquisition of the world’s largest construction tradeshow. The business-to-business events, marketing and publishing company revealed that headline revenues in the six months ended 30 June increased from £434.3m to £474m, 6.4% higher on an underlying basis. The improvement was boosted by strong growth (+27.1%) in Events revenue and Online Marketing Services (+35.3%). Revenues from Print (through which UBM publishes more than 100 print magazine titles) fell by 19.7%, but the group assured that its dependence on Print sales continues to diminish and now accounts for 12.6% of total sales, down from 17.1% during the same period in 2010. Separately, UBM acquired International Business Events for an initial cash payment of £31m and a further £20m, which will be paid over the next year dependent on performance. The purchased firm owns Ecobuild, “the world’s largest exhibition dedicated to sustainable building products and is the fastest-growing trade event in the UK”, UBM said. Meanwhile, adjusted operating profits rose 10.5% in the first half, from £83.2m to £91.9m. Pre-tax profit rose 7.1% to £62.2m, while earnings per share increased 9.6% to 20.5p. The group raised its dividend per share from 6p to 6.3p.

29th July 2011 Analyst: Philip Morrish Email: philip.morrish@gecr.co.uk Tel: 0207 562 3362 Avisen* - Group Repositioned for Growth; Increased Target Price 10.6p; Reiterate Stance of Buy

Commenting on the results, Henry Angest, Chairman and Chief Executive of Arbuthnot, said: "Despite the mixed performance in the first half, we remain positive about the rest of the year. The completion of the intended placing of new shares in Secure Trust Bank PLC will mean we can accelerate growth and substantially increase profitability."

Arbuthnot Banking Group (ARBB) reported a 91% fall in pre-tax profits to 0.2 million pounds for the six months ended 30th June 2011 as its investment banking arm, Arbuthnot Securities, suffered exceptionally difficult market conditions. Despite this, pre-tax profits for its retail banking and private banking both rose, with client numbers increasing significantly and its loan book size and assets under management both growing at double digit rates. Arbuthnot shares closed unchanged at 342.5p.

http://www.investegate.co.uk/Article.aspx?id=201107290700163258L

Mark Mattison, Sky High's Chief Executive, said: "This has been a challenging year for the Group as we have had to respond to the biggest cuts in public spending for decades and one of the most turbulent economic periods. We have worked hard to respond positively to the market conditions with some success as evidenced by the return to profit for the second six months trading. Despite a challenging last year and the continuing general economic uncertainly I am increasingly confident about the prospects for the Group moving forward. I welcome Martin and Alex onto the Board and am sure they will make a positive contribution to the management of the Group."

The impact of government spending cuts saw turnover fall 16% to 4.8 million pounds at Sky High (SKHG), leading the company to a pre-tax loss of 249,000 pounds for the year ended 31st March 2011; a contrast to the previous year's profit of 267,000 pounds. On a positive note, the group returned to profitability in the second half of the year, following on from a substantial loss position in the first. The data analysis group's Australian arm meanwhile made a 46,000 pound profit. Sky High shares rocketed 2p to 12p

http://www.investegate.co.uk/Article.aspx?id=201107290804263456L

Rod Hyde, Group Chief Executive, said: "Following the sale of Interel, the Group is now a focused digital and communications business. "Investments in intellectual property, people and office relocations are starting to show results. Interact generated more intranet sales in the first half than in the whole of 2010 and following the announcement of Unilever joining the client roster, Amaze has won further significant pan-european and global accounts."

Digital communication services group Hasgrove (HGV) announced it expects to report a 2.8% fall in revenue to 13.7 million pounds, as well as a pre-exceptional operating profit of 1.6 million pounds, down from 1.7 million pounds, in its half year results at the end of September. Lower operating profits reflected a difficult start to the year, the group explained, as major clients delayed spending. Net debt increased 10.5% to 7.4 million pounds as of 30th June 2011 from adverse currency movements and the move to a new London office. Hasgrove shares closed 9p behind at 61p.

http://www.investegate.co.uk/Article.aspx?id=201107290700123169L

Alan Brown, Chief Executive Officer of Rentokil Initial plc, said: "In a difficult trading environment we have made good progress against our key objectives in H1, continuing to build capability and achieving organic revenue growth (excluding City Link) earlier than expected. "Textiles & Hygiene Benelux has performed consistently in line with plan over the past four months and will return to profit growth in H2. City Link has made considerable progress in operational and customer care systems and although its financial performance remains unsatisfactory, trading has been stable since February. "Our 2011 cost savings programme is on track but inflationary pressures are particularly evident in Textiles & Hygiene and Ambius. The pricing environment has eased slightly in continental European markets. "In City Link, I am encouraged by our strong operational progress and the new business pipeline, the combination of which should lead to improved year-on-year performance in Q4 though the full impact of our initiatives is unlikely to be felt this year. Elsewhere, we expect further progress across the group in H2 despite ongoing challenging conditions in some of our markets."

http://www.investegate.co.uk/Article.aspx?id=201107290700153253L

Shares in Rentokil (RTO) gained 1.5p to 91.8p after the pest control company reported pre-tax profits of 73.5 million pounds for the first half of 2011, 7% ahead of consensus forecasts, but 6.8% lower than last year's comparable period. The group claims to have stabilised the customer base for its loss making subsidiary City Link, where revenues fell 13.5%, and has achieved savings of 24 million pounds across the company, with a full year target of 60 million pounds.

Adjusted pre-tax profits at Travis Perkins (TPK) were up 25% for the six months ended 30th June, on last years equivalent period, at 140 million pounds. The builders merchant also announced that its synergy programme with recent acquisition BSS Group is on track to save 15 million pounds in 2011. However, the group does not plan to pursue much organic growth in the short term, as a result of difficult market conditions, and expects market activity to decline in the second half of the year. The shares lowered 44p to 883.5p.

British Sky Broadcasting (BSY) announced revenues of 6.6 billion pounds for the year ended 30th June 2011, up 16% from last year, with adjusted operating profits 201 million pounds higher at 1.073 billion pounds. This growth comes as the result of a 4.3% growth in customers, to 10.3 million, including a 30% increase in Sky+HD products, reaching 3.8 million. Separately, the company has been awarded live coverage rights of Formula 1, in conjunction with BBC, for the next seven years. This includes all races, qualifying and practice sessions live on Sky Sports. The shares dropped 4p to 712p.

Matrix reiterated its "buy" recommendation for Shire (SHP) with a 2,300p target price. The broker was impressed with the pharmaceutical company's second quarter results, with production up 30% year-on-year and revenues up 25% at 1.063 billion dollars (0.65billion pounds), slightly ahead of the broker's forecast of 1 billion dollars (0.61 billion pounds). Matrix notes that the group has had strong performance in the attention deficit hyperactivity disorder market with its Vyvanse and Intuniv drugs, with further growth expected as it enters the European market. Shares in Shire shed 12p to 2,124p