Johnston Press (LON:JPR) (JPR, 14.75p, £94.36m), the operator of community media groups in the UK and Ireland, reports results  for the 26 weeks ended 3 July 2010. A 6% uplift in adjusted operating profit to £40.5m (H109: £38.2m) despite a 5% decline in revenues to £207.3m (H109: £218.6m) reflects the benefits of the cost cutting exercise. The advertising revenues remained weak whilst digital revenues grew by 11% the first half. We believe this trend is set to continue given into the remainder of the year given the weak and fragile state of the UK economy and the scope for a potential double dip. In the first 6 weeks of H2 2010, l-f-l total advertising revenues are down 3.7% vs. 6.3% in H1 2010. This demonstrates customers are exercising increased caution in their expenditure in the face of slower economic growth. The Board state “in the absence of a further deterioration in the UK economy that the outcome for the Group in 2010 will be in line with current market expectations”. We expect deterioration in the UK economy will encourage the market to downgrade current 2010 consensus PBT estimates from £36m and EPS of 4.2p. Based on the current market expectations, the stock is rated on 3.5x, a discount to the media sector due to the £401m of net debt. Given the debt is serviceable with an interest cover of 2.1x, we believe the level of discount to the sector is unwarranted. We initiate with a BUY recommendation with a target price of 20p.  

Plant Impact Plc (LON:PIM) (PIM, 15.5p, £7.08m) has announced field trials have started with key strategic partner Syngentia in Brazil. The tests address the use of CaT and PiNT technologies for use with soybean, corn, cotton, and coffee. The tests are being supported by EMBRAPA - the Brazilian state owned company affiliated with the Brazilian Ministry of Agriculture and is devoted to pure and applied research on agriculture. SPECULATIVE BUY

Robinson (LON:RBN) Group (RBN, 45p, £7.17m) Interims to June 2010 saw revenues of £11.52m (£9.65m), gross profits of £1.96m (£1.16m), gross margins of 17.1% (12.0%), lower operating costs due to forex of £1.96m (£4.72m) leading to an underlying PBT of £0.19m (loss £0.93m). Net debt increased to £4.24m from the year end £2.83m, reflecting an adverse working capital movement of some £1.86m. Despite this the group has increased the interim…

Unlock the rest of this article with a 14 day trial

Unlock with Email
Unlock with Google

Already have an account?
Login here