Profits in the year to October only crept ahead to £90.8 million from £89.1 million, despite revenues jumping by 25% to £745 million. 

Underlying profits rose by 6% to £125.6 million with organic revenue growth at 9%.

Chairman Peter Hickson said: “The continuing problems of the Eurozone and the impact of possible sequestration in the US indicate that our traditional markets will not be any easier this year.”

He added that the group is looking at markets outside of its traditional NATO customer base and the proportion of non-NATO work has risen to 44% of the order book from 33% a year previously. Orders at the year-end had risen by 12% to £980 million.

The share price fell despite Chemring saying it would pay out more in dividends in future. 

The latest payout rose by 25% to 14.8p and in future earnings cover wil reduce from 4 times to 3.5.

Over the past twelve months, munitions supply saw the strongest growth with revenue up by 104% to £237.0 million following a strong second half performance from Mecar.

Counter-IED revenue increased 46% to £167.6 million, but Pyrotechnics decreased 18% to £139.9 million and underlying operating profit decreased 19% to £32.4 million, principally due to lower demand for 81mm illumination products.

Shares in the airline Flybe (LON:FLYB) dived 38 per cent this morning after the firm issued a profit warning.

Although Flybe reported that the first half of its 2011/2012 financial year the firm delivered a strong revenue performance, it said that it noted in September “a significant slowdown in sales across our UK domestic network”. As a consequence, the group’s total revenues for H1 2011/12 were circa one per cent behind management’s expectations, with costs in line with expectation, it added.

The firm said that its first half saw a total of 6.4 million seats flown – an increase of 0.2 million over H1 2010/11 – and, after adjusting for the impact of the volcanic ash disruption in 2010, H1 2011/12 seat numbers were down on H1 2010/11 by 1.7 per cent.

The firm also reported that the first half saw improvements in passenger numbers, load factor and both ticket and ancillary yields – resulting in a year-on-year increase in passenger revenue per seat of some six per cent.

As far as current trading is concerned, Flybe said that it is “too early to determine whether the September slowdown in sales on our UK domestic routes is a short term reaction to the turbulent macro-economic environment, or whether this is a longer term market adjustment”.

Investors reacted to the news by sending the shares down. They had lost 40.9 per cent to hit 60 pence each by mid-morning.

Flybe had cash balances of £87.5 million at the end of September.

FTSE100 engineering firm Smiths Group (LON:SMIN) announced today that its subsidiary Smiths Interconnect is paying US$235 million to buy US-based power engineering business Power Holdings.

Power Holdings (PDI) is the parent company for three companies that between them produce a range of components used in the power industry, including: power distribution units, static transfer switches, remote power panels, power conditioning units and medium and low-voltage transformers, as well as power monitors used in data centre and alternative energy applications.

Smiths will pay private equity firm Bertram Growth Capital in cash for Power Holdings, subject to regulatory approval.

PDI is expected to generate around US$156 million in sales this year, with more than 90 per cent of revenues from non-government funded markets.

"Smiths Interconnect operates in a highly fragmented market that offers great scope for consolidation,” said Philip Bowman, Smiths’ group chief executive. “PDI is its sixth and largest acquisition in three years, all adhering to our strategic criteria of adding complementary technologies, extending geographic reach or leveraging existing sales networks. This latest transaction expands its range of power quality technologies into new, specialised, high growth markets."

The firm said that the acquisition of PDI is part of Smiths Interconnect’s strategy to build core technology groups. This latest deal is designed to transform its power protection group with a new range of products and growth opportunities, it added.

The performance was described as “solid” by chief executive Jim French, who said the company was trading in line with market forecasts. 

In total the number of seats sold increased by 7 per cent to 3.1 million. However, the performance in the comparable period last year was marred by the delays and cancellations caused by the volcanic ash cloud. 

The amount it made from tickets rose 3.4 per cent to £62.27 per passenger, while income from other “ancillary” sources such as food, drinks and gifts increased 8 per cent to £13.89.

Meanwhile, the €25 million acquisition of the Finnish Commuter Airlines is expected to complete later this month.

 CEO French said:  "This is a satisfactory trading and operational performance achieved against a continuing backdrop of high fuel costs and challenging economic conditions.  We are pleased to report encouraging increases in revenue per passenger and revenue per seat.

“The group has also made excellent progress on its strategic growth plans, with the acquisition of Finncomm, the strengthening of the management and divisional structures and aircraft sales.

“Current trading is encouraging, with forward ticket sales revenue up 6 per cent year-on-year.  

“Though at an early stage of the year and with uncertain macroeconomic conditions facing us, based on current trading the board maintains its expectations for the full year, and is well placed to deliver on its growth plans in the coming years."

Underlying pre-tax profit was £995 million on sales of just over £11 billion. 

The company, which is the world’s second largest producer of jet engines, has been rocked by two scares.

A Qantas Airbus A380 ‘superjumbo’ suffered a partial engine failure in service, while on Boeing's 787 programme, engine failure during ground testing led to further delays for the entry-in-service of the new plane. A large portion of the Qantas-related costs are contained in today’s 2010 results.

Departing chief executive Sir John Rose said: “Rolls-Royce has delivered a strong performance in 2010 with record underlying revenues and profits. 

“This reflects our global customer base and the balanced portfolio of products and services that we offer.  

“It is a measure of progress that the civil, defence and marine businesses now each generate underlying profits of more than three hundred million pounds.   

“During 2011 the Group expects good profit growth and a modest cash inflow.”

The shares opened down 2.5 pence at 653 pence in early trade, but in the past year Rolls has grown by a third in value.

BAE Systems (LON:BA) is to take over Dublin-based and AIM-listed Norkom Group (LON:NORK) in a recommended €217million deal.

Norkom is a technology company that specialises in software to protect financial firms from financial crime, as well as providing compliance software. The new business is seen as complementary to BAE’s digital security arm, Detica. The deal will expand BAE’s presence in the sector.

The FTSE100 constituent is offering Norkom shareholders €2.10 per share, a 35 percent premium to yesterday’s closing price. The takeover has already been recommended by Norkom’s board.

BAE has already secured almost 45 percent of Norkom’s share capital, after Norkom’s management and major shareholders - TVC Holdings - backed the bid.

"Countering financial crime is a priority for governments and financial institutions,” BAE chief executive Ian King said.

“There is a compelling logic to the combination of Detica's NetReveal® product and the complementary capabilities and customer reach of Norkom.  

“The combination will result in a significantly enhanced offering for customers and present an opportunity for accelerated growth for the BAE Systems Group in the fast growing cyber and intelligence services sector."

The 18.7 million new shares represent 43 percent of the enlarged share capital, and at 160 pence it is priced with a 20 percent discount.

The company floated on the AIM market in March 2010. It was formed to focus on the homeland security market where it sees a compelling commercial opportunity, due to the threat of international and domestic terrorism.

Digital Barriers provides digital security and surveillance technology to high-profile, high-value potential targets.

"We have been delighted with the level of support our shareholders have continued to show to the company through this placing,” chairman Tom Black said.

“We remain excited about the opportunities ahead of us to continue to deliver on our strategy to become a leading provider of specialist products and services to the homeland security and specialist defence markets."

The turbine and engine manufacturer and FTSE 100 constituent said that the fallout from the incident was partially mitigated by the performance in the marine and defence businesses, however its full year profit growth will be slightly lower than previously guided.

Back in July, the company said its underlying profits would grow by 4-5% compared to 2009.

Earlier this month, the company had its own Deepwater Horizon moment when a Sydney bound Airbus380 jet operated by Qantas Airlines had to land in Singapore due to a failure of a Trent 900 engine manufactured by Rolls Royce.

The company said today that the issue is specific to the Trent 900 and that the failure was confined to a specific component in the turbine area of the engine. As a result, Rolls-Royce will replace a part in the engines.

“We have instigated a programme of measures in collaboration with Airbus, our Trent 900 customers and the regulators.

“This will enable our customers progressively to bring the whole fleet back into service.

“This event and the consequent actions will have an impact on the group's financial performance this year,” said chief executive of Rolls-Royce Peter Rose.

The board also expects a small cash inflow in 2010 with the average net cash balance remaining similar to the £915 million in the first half of the year.

Cobham will bid on task orders over the next five years in support of the Ballistic Missile Defense System, with work performed in all MDA operating locations to include Huntsville, Alabama, Washington DC and Colorado Springs.

The MDA has awarded similar contracts to four other companies. All companies have the opportunity to bid on each individual task order, which are expected to start before the end of 2010.

Cobham Analytic Solutions was formerly known as SPARTA Inc.

XCAP is an independent stockbroking, corporate advisory and market-making business.

The company raised £5 million in last week’s initial public offering, placing 387 million shares to give it a market cap of £17.5 million.

The new funds will be used to maximise regulatory capital levels so as to enable the company to provide substantial trading books and provide general working capital.

XCAP has already completed 5 fundraisings on AIM since May 2010 and has been appointed as broker to 8 AIM companies.

Currently serving as market maker to 179 stocks, the business aims to take this number to 500 within a year of its listing as well as achieve rapid growth in its retail and institutional broking businesses.

The Asset Management team it recruited from Deutsche Bank is now well established and based in the company's Wilmslow office.

According to XCAP, its market-making, retail and institutional banking teams have made an “extremely encouraging” start to the year and the immediate outlook was positive.

“We have had extremely positive reactions from a wide range of investors and the fact that our IPO completed successfully in challenging market conditions is testament to the long-term growth potential offered by XCAP,” said Chief Executive of XCAP Daron Lee.

OASYS develop and manufacture electo-optical technology, which is used in night-vision, reconnaissance & surveillance, Helmet Mounted Displays (HMDs), laser sub-systems as well as illumination and imaging systems.

The specialist engineering group is currently owned by 5 individual employees.

The $25m cash deal also includes a further $30m in potential ‘earnouts’ and BAE is expected to fund the transaction from its cash resources.

The diamond drill rig commenced operating a double shift over the weekend and executive director Richard Wolanski said today the rig is drilling “round the clock”. Due to the slower meterage achieved per hour by diamond drilling a double shift is necessary in order to achieve the 20,000 budgeted drill metres this season.

Priority drill targets at Speewah are the Eiffler, Hayden, East Dome, Gray’s Vein, Blue Vein, Green Vein and Yungul prospects.

Drilling to conclude in December (dependent on on-set of wet season).  First drill assay results are expected to commence mid-October into first quarter 2011.

Drilling will commence on southern targets initially before moving systematically northwards over the tenement. The reason for this is to enable improved access and completion of drill pads on the recently identified northern drill targets that have delivered the "exceptional copper/gold/silver lead rock chip assays" reported in recent weeks.

In a statement, the NiPlats board of directors said the planned drilling propram will increase the opportunity for success by ensuring that a maximum amount of drilling can be achieved throughout the remainder of the 2010 exploration season.

Drill rigs are required to be off-site prior to the commencement of the ‘wet season’ in the Kimberley. The board expects that further drill targets will be generated over the coming weeks while the soil and rock chip programme continues and complementary geophysical programmes are completed to assist in target generation and prioritisation.

In July and August, NiPlats reported spectacular high grade copper, gold and silver assays in surface samples from Speewah.

The award is the base year of a five year agreement with the U.S. Air Force. Funding for the option years will be allocated annually.

“This contract will facilitate a smooth, continuous supply of parts to ensure the U.S. Air Force maintains a high level of mission capable aircraft. Cobham is committed to supporting our customers and aftermarket sustainment of our products,” said President of Cobham Life Support Kelly Coffield.

Cobham Life Support provides life support and personal survival equipment for use under extreme conditions including oxygen systems for aviators and astronauts, crew restraints, flotation gear, emergency beacons and crew and cargo release systems.

Iron Road engaged Mineral Engineering Technical Services (METS) to investigate the metallurgical characteristics of the Warramboo mineralisation as a major component of the pre-feasibility study at the Central Eyre Iron Project in SouthAustralia.

The testing is part of the Company’s pre-feasibility study for the project, which is scheduled to be completed in early 2011.

Iron Road managing director, Andrew Stocks, said that the recovery of iron from the oxide portion of the mineralisation was a pleasing development.

“The hematite component is approximately ten per cent of the current Mineral Resource and these results reveal the robust nature of the Central Eyre Iron Project. Demonstrating the oxide recovery, along with our belief that the Central Eyre hosts a very large and very coarse magnetite iron ore deposit will only strengthen the pre-feasibility study, still scheduled for completion in Q1 next year,” he said.

Test work and Wilfrey table test work on RC chip samples indicates that hematite (oxide) ore from the Boo-Loo – Dolphin prospect is amenable to upgrading.

WHIMS at a magnetic strength of 10,000 Gauss and -212μm grind produced a concentrate containing ~60% iron with ~5% SiO2.

Iron recovery was approximately 60% with a mass recovery of 30%. Wilfrey tabling generated >60% iron with best grade and recovery performance at 500μm.

The coupling of both gravity and magnetic separation during beneficiation may reduce overall capital costs.

London & Stamford said the move was warranted by its market cap, which currently stands at £582 million, and would help it gain access to a broader range of investors and thus improve liquidity.

The company will enter the REIT regime upon admission to the Main Board. The REIT status will allow the company to be exempt from future corporation tax on both rental profits and chargeable gains on disposal of investment properties.

LSP is not currently eligible to elect for group UK-REIT status due to the fact that its shares are not listed on a recognized stock exchange and it is not a UK resident.

“We believe that converting to a REIT, moving to the Official List and internalising management is the best way forward for shareholders. We are pleased to be announcing these proposals which we believe will enable us to enhance shareholder returns as we continue to grow the business and take advantage of the significant opportunities we see to deploy LSP's capital at attractive long term cash yields,” said chairman Raymond Mould.

The company also announced plans to buy LSI Management LLP, which currently provides it with property advice and management function, for £55 million, to be paid in new shares in the company. Following the acquisition, the management team will hold 9.1% of the issued share capital of the company.

The move is aimed at reducing the group’s ongoing administrative costs in respect of fees paid under the property advisory agreement, which totalled £10.8 million in the year to 31 March.

The switch to the Main Market and the acquisition are now subject to shareholder approval.