UK defence companies stand to benefit from rising military budgets as NATO allies target 3.5 per cent of GDP spending. Babcock International leads the pack with its £9.8bn order backlog and nuclear submarine expertise, including contracts for the Dreadnought class fleet. However, a £140mn Type 31 frigate charge overshadowed £433mn operating profits, up 19 per cent.

Shares fell 30 per cent below consensus targets despite the defence tailwind. The company maintains its position on nuclear submarine maintenance at Devonport dockyard, supporting the UK's continuous at-sea deterrent that keeps one ballistic missile submarine on patrol constantly.

Telecom Plus plunged over 25 per cent after slashing its dividend by nearly half to 50p and warning adjusted pre-tax profit would drop to £80-90mn. The Utility Warehouse owner faces a five-year turnaround to double multi-service customers by 2031, with Peel Hunt cutting 2027 forecasts 39 per cent to £85mn.

Meanwhile, Moonpig delivered solid results under new CEO Catherine Faiers, with Ebitda rising 8 per cent to £105mn and free cash flow up 11 per cent to £73.5mn. Customer order values climbed 6 per cent through premium gifts and tracked delivery, supporting the group's ability to meet adjusted earnings targets despite moderating revenue guidance to mid-single digits.