Sports Direct Slams £73m Boss' Bonus Rejection

High street retailer Sports Direct has slammed shareholders who failed to support a £73m bonus share scheme proposed for founder Mike Ashley.

The comments come as the company reported a rise in fourth-quarter sales to £360m in the nine weeks to March 30.

It said its core sports retail sales were up 11% in the period.

In early April, the company halted the proposed £73m bonus for Mr Ashley, its majority shareholder, after failing to gain sufficient investor support.

"The board was extremely disappointed to withdraw the resolution regarding a proposed share scheme award to Mike Ashley," Sports Direct chief executive Dave Forsey said in a statement.

"The most disappointing aspect was where large shareholders gave their support only to then vote differently.

"This outcome is likely to lead to further uncertainty in the future."

Sports Direct has around 400 stores in the UK and another 200 stores in Europe.

Sales in its smaller fashion arm, trading under the USC and Cruise brands, rose 0.7% in the period.

Shortly after the bonus rejection for Mr Ashley, who does not receive salary or bonus from the company, it saw a share price dip.

The decline came after he reduced his stake by 4% to 57.7%.

It now plans to include Mr Ashley, who also owns Newcastle United Football Club, in a company-wide share scheme eligible for all staff and executives.

The group also moved to expand its foothold in other groups, and bought an 11% stake in retailer House of Fraser amid its tie-up negotiations with China's Sanpower group.

It had earlier snapped up more than 4% of Debenham's shares before selling the tranche shortly afterwards.

Sports Direct said it expected to meet its full-year forecast of £310m, before staff bonuses are deducted.

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Primark Sees Profit Up 26% In Last Six Months

Discount fashion chain Primark has seen its half-yearly operating profit rise 26% to £298m.

Owner Associated British Foods (ABF) said its retail arm saw the surge in profit in the 24 weeks to March 1.

Revenue in the period for Primark was up 14%, to £2.278bn.

While like-for-like sales growth was 4%, its aggressive expansion plans with larger new stores helped drive the increase in revenue.

ABF shares were trading more than 8% up on Wednesday morning.

The chain saw double-digit growth in Spain and Portugal, along with "very strong" growth in northern Europe.

It now has 269 stores with a total selling space of 9.6 million square-feet and expects store expansion to increase by a third more than that achieved last year.

Its operating margin increased by 13.1%, brought about by improved warehouse and distribution efficiencies and lower freight rates.

ABF revealed more details about compensation for workers in Bangladesh, following the collapse of an eight-storey factory in capital Dhaka, which claimed the lives of 1,100 people a year ago.

Primark has paid compensation over the collapsed Rana Plaza in Dhaka

It said $2m (£1.18m) has been paid in short-term aid to the families of all the workers employed at Rana Plaza, most of whom it claims were making clothes for its competitors.

ABF has further agreed to pay $1m (£595,000) to the Rana Plaza Donors Trust Fund, chaired by the International Labour Organisation (ILO).

A further $9m (£5.34m) is being paid in long-term compensation to the affected families.

ABF said the total compensation totaled $12m, of which $7m was included in last year's results and $5m factored into this year's results.

It said: "We support the ILO in urging other retailers sourcing from Rana Plaza to donate to the trust fund so that it can pay out in full to the remaining victims."

ABF has also announced a decision to take the Primark brand to the United States.

It will open a 70,000 square-foot store in Boston, ahead of further expansion plans in the north-east of the US during 2016.

Overall the company, which also has interests in groceries, sugar, agriculture and ingredients supply, saw group revenue down 2% to £6.2bn and pre-tax profit up 4% at £468m.

ABF owns brands including Twinings tea, Kingsmill bread, Jordans, Ryvita and Silver Spoon sugar.

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Budget Deficit Drops By 6% In Last Year

The UK budget deficit has fallen to its lowest level since the financial crisis five years ago.

Official figures from the Office for National Statistics (ONS) show the shortfall in tax revenues over Government spending fell to £107.7bn in the 12 months to the end of March.

The figure showed a drop in the deficit of 6.42%, from £115.1bn the year before.

It was slightly lower than forecast by the Office for Budget Responsibility, in the March Budget delivered by Chancellor George Osborne.

The ONS said borrowing in March dropped by 41% to £6.7bn, amid a plan by the Government to eliminate the deficit entirely by 2017-18.

The latest figures exclude the impact of the Royal Mail pension scheme since the postal service was privatised in October.

It also does not take into account the Bank of England's liquidity boosting scheme, known as quantitative easing.

The ONS says Britain's net public sector debt now stands at £1.27bn, which equates to 75.8% of gross domestic product (GDP).

The figures come as the European Union's statistical agency, Eurostat, said governments across the 28-country bloc recorded lower budget deficits in 2013.

This was due to lower spending and a partial economic recovery that shored up revenues.

Eurostat said budget deficits across the 18-nation eurozone fell from 3.7% of annual GDP in 2012 to 3% last year.

For the entire EU, which also includes non-euro currency members such as Britain, the agency said deficits shrunk from 3.9% to 3.3%.

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GSK In £8.5bn Deal With Swiss Rival Novartis

British drug giant GlaxoSmithKline (GSK) is to sell its oncology business to Novartis for $14.5bn (£8.5bn) and will buy the Swiss company's vaccines division.

Novartis is expected to pay another $1.5bn (£900m) if certain milestones on the deal are met.

Under a "major three-part transaction" GSK and Novartis have agreed also to create a consumer healthcare business, GSK confirmed in a statement.

GSK will own 63.5% of the newly-created consumer healthcare business.

The British firm said it would use proceeds from the deals to return £4bn to its shareholders.

Shares in the company were up more than 4% in midday Tuesday trades.

GSK chief executive Sir Andrew Witty said the deals are expected to be completed during the first half of 2015.

He said they would accelerate the firm's strategy to generate "sustainable, broadly sourced sales growth and improve long-term earnings".

Novartis confirmed it signed several multibillion-dollar deals with GlaxoSmithKline and US company Eli Lilly, which may affect up some 15,000 of its employees.

It will sell the vaccines business to GSK, excluding its flu sector, for $7.1bn (£4.2bn), plus royalties.

Eli Lilly will buy the Basel-based firm's animal health division for about $5.4bn (£3.2bn)

No details have been released on the potential impact of the deal on jobs for the Brentford-based GSK.

Sir Andrew added: "Opportunities to build greater scale and combine high quality assets in vaccines and consumer healthcare are scarce.

"With this transaction we will substantially strengthen two of our core businesses and create significant new options to increase value for shareholders."

Meanwhile, US pharma giant Pfizer may renew its bid for British drug company AstraZeneca, after its reported £60bn takeover approach was rejected.

AstraZeneca topped the FTSE 100 top risers on Tuesday morning, up more than 7% on the potential deal before easing slightly.

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Eight Renewable Energy Projects Get Go-Ahead

Plans for eight renewable energy projects - expected to generate enough clean power for three million homes - have been approved by the Government.

Contracts for schemes including offshore wind farms and the conversion of coal-fired power stations to run on biomass, are set to support 8,500 jobs and attract up to £12bn in private investment.

Once built, the projects will contribute around 4% of the nation's total energy supply.

The schemes - five of which are offshore wind farms - are being taken forward under the Government's Contracts for Difference (CfD), under which generators and developers receive a fixed price for the electricity they produce for 15 years.

These contracts aim to give investors the guaranteed income they need to pay the up-front costs of major new construction projects.

Government measures are set to increase household bills by 2%, but energy secretary Ed Davey said the policy would bring down overall costs.

He told Sky News: "It's a real boost to green energy and will help ensure we have green energy too."

"It will really add to our electricity supply, we reckon about 4% of our total capacity. So it is really helping to ensure we can keep the lights on and do it in a green, affordable way."

Mr Davey has also confirmed that the Government is looking at changing trespass laws to enable companies to carrying fracking under private land.

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Battle For Control Of Net Kicks Off In Brazil

The battle for control of the internet enters a new phase today when 850 experts thrash out its future in Brazil.

Last month, the US announced it plans to give up oversight of the way net addresses are distributed.

Now hundreds of government officials, technical experts and academics are meeting at the NetMundial conference in Sao Paulo to discuss who should oversee the worldwide web in future.

China and Russia want the United Nations to have some say over how the internet is controlled, while the US and parts of Europe say it should be at arm's length from government control.

A draft outcome document has been drawn up for discussion, but the final text will not be binding.

The US currently oversees the Internet Corporation for Assigned Names and Numbers (Icann), but is willing to relinquish control by September 2015.

Officials from countries including China, the US and Great Britain will attend the two-day conference, which was due to be opened by Brazilian President Dilma Rousseff.

Organisers say every attendee - from academics to government officials - will have an equal voice.

The goal is to agree on principles that could form the basis of later internet governance discussions.

It is expected that despite the non-binding nature of the discussions, an accord will be hard to reach.

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Chinese Government Shuns 'Expensive' Windows 8

Enduring Windows Operating System XPires

Updated: 11:42am UK, Wednesday 23 April 2014

By Tom Cheshire, Technology Correspondent

The workhorse that is Windows XP is off to the glue factory, after 12 years of dutiful service.

But it can be hard to say goodbye to a faithful old operating system (OS) - especially for businesses and governments.

According to Kaspersky Lab, nearly 18% of computers used by consumers and businesses still use XP.

So why have people stuck with the operating system for more than a decade?

First off, Windows XP was pretty solid: not as intuitive or secure as the Mac OS family, but good enough for the job.

It was a good platform for a whole host of applications, which businesses could pick and choose from.

And the OS was installed on a fairly reliable generation of PCs, which have gone a long time without being replaced.

If anything, XP was perhaps too solid.

Businesses and users chose to stick with what they knew rather than upgrade to systems like Vista, 7 and 8, which had much publicised teething problems.

Organisations that can't risk their systems going down - in finance, or government, for example - stuck with XP.

Fewer and fewer individuals are, though.

The proliferation of tablets and smartphones, which tend to use Apple and Google designed operating systems, means proportionally fewer computing devices run Windows than ever.

Consumers are increasingly happy to manage a pool of different operating systems - on their phone, tablet and computer - and hop between them. Windows XP may be the last operating system to endure for a decade.

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Eurostar Gets Big Boost From Business Travel

Cross-Channel train service Eurostar has seen a 7% increase in revenue in the first-quarter, boosted by a rise in business travellers.

Sales between January and March topped £227m, as the record income for the period.

Although passenger volume was up 3% to 2.3 million compared to the same period last year, travellers in its premier class were up 6%.

So-called leisure travellers were up 3% despite the fact that numbers last year were being boosted by an earlier Easter and foreign visitors.

But travel figures for the second-quarter may be dampened by this year's pre-Easter getaway, when a large number of trains were cancelled because of two separate incidents.

Eurostar chief executive Nicolas Petrovic said: "The improvement we have seen in the corporate travel market in recent months underpins the strong performance reported today.

"Coupled with the benign winter weather, which saw far lower levels of weather-related disruption than in previous years, the first quarter has set us on course for continued growth throughout the year."

Lightning strikes in March sparked a series of fires in the South East, leading to travel disruption on the international trains.

Four Eurostar trains were halted on the line after a fire broke out near the UK entrance to the Channel Tunnel.

In January, it was announced that two UK phone providers had signed 10-year deals to supply phone access in the 30-mile undersea tunnels.

The deal, mirroring a French equivalent in operation since June 2012, was seen as a way of further boosting the service for business travellers wishing to remain online throughout their journey.

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Factory Orders 'At Their Best Since 1995'

Manufacturing orders placed with factories have expanded at the strongest rate since 1995, a new survey has shown.

The results come as the Bank of England said Britain's economic recovery was "building momentum".

According to the Confederation of British Industry (CBI), its industrial trends survey showed that in the last quarter international and domestic orders were at there strongest for nearly two decades.

The CBI said export growth was strong while investment intentions for the next 12 months were "particularly robust".

The strengthening position comes as the job rate continues to rise and is now at its best rate for nearly three years.

The CBI's survey of 405 companies found that manufacturers' business optimist saw the sharpest increase for four decades.

It said 38% of firms revealed total orders increasing while 17% saw a decrease - a net increase of 21%.

The positive balance for new home market orders was 17% - the highest since April 1995.

According to the trade body, last month's figures revealed a slight easing of the position.

CBI chief policy director Katja Hall said: "Confidence is rapidly rising among British manufacturers, with a real sense of business optimism.

"Our industrial base is seizing a bigger role in the UK's economic recovery, with output, orders and hiring all on the up.

"There are still bumps in the road ahead, with only a tepid recovery likely in the eurozone, the pound creeping higher and a rapidly-evolving situation in Ukraine.

"However, expectations for growth in the coming three months are positive and manufacturers plan to significantly ramp up investment in the year ahead."

The survey was released on the same day as the minutes from the latest meeting of the Bank of England's rate-setting Monetary Policy Committee (MPC).

The MPC estimated growth for the first quarter at 1% and said: "Business investment was estimated to have grown by 8.5% in the year to 2013 Q4.

"The refocusing of the (Funding for Lending Scheme) was expected to support capital spending over the coming year."

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Ex-EMI Boss Nicoli Returns With New Music Gig

By Mark Kleinman, City Editor

Eric Nicoli, the former chief executive of EMI, is returning to the music industry as an investor in Tunehog, a service that aims to stand out from a crowded digital streaming market through technology which sonically 'maps' millions of songs.

Mr Nicoli, the chairman of R&R Music, Tunehog's parent company, has been working on the new venture alongside David Ritchie, the company's chief executive.

Sky News understands that R&R has secured financial backing totalling more than £10m from Toscafund, a prominent investment firm, and Martin Hughes, its principal.

R&R, which has launched a number of apps in online stores in recent weeks, will target artists and advertisers as well as music fans through a range of services.

Since leaving EMI in 2007, Mr Nicoli has held a number of non-executive posts, including roles at Greencore, the Irish food group, Vue Entertainment, the cinema operator, and Uswitch, the online consumer services website.

He and Mr Ritchie established R&R in 2008 with the aim of developing a digital music service which differentiates itself from a wide proliferation of rivals through its ownership of algorithmic technology, which allows it to 'discover' music tailored to individual customers' preferences.

Developed under the code-name Project Synapse, the venture attempts to "create a music ecosystem that creates individualised and completely personalised music offerings that reflect the way that the brain and body relates to sound in everyday life," according to marketing materials seen by Sky News.

R&R's products include Discovery Player, which enables fans to use their musical tastes to identify tracks from established and emerging artists - Sync, a one-stop shop for brands looking to license music for commercial projects - and Hitmaker,  a tool for music professionals who want to optimise the quality of their work or their portfolio.

A number of deals with commercial partners, including several global consumer brands, are being finalised, according to people close to the company.

The music-streaming market has exploded during the last decade, with digital revenues accounting for roughly $5.8bn (£3.45bn) of the industry's $16.5bn (£9.8bn) of recorded music sales in 2012.

Despite the likes of Apple's iTunes spending vast sums of money on marketing, no single service has so far emerged as a dominant force in digital music retailing.

Pandora Music, Spotify and Beats Music, which is backed by the rapper and producer Dr Dre, have all launched consumer propositions with varying levels of sophistication at targeting individual consumers.

Meanwhile, MusicQubed, a UK-based venture backed by Sir Richard Branson, the Virgin Group founder, is trying to undercut more expensive subscription-based services.

Tunehog represents Mr Nicoli's first consumer-facing music venture since he achieved a stellar outcome for shareholders in EMI by selling it to Terra Firma Capital Partners, the private equity firm headed by Guy Hands, the City financier, for more than £4bn.

EMI was subsequently taken over by Citi, its principal lender, in 2009, after running into financial trouble, and was then broken up and sold to Warner Music Group and Sony.

Mr Hands continues to pursue legal action against Citi over its seizure of EMI.

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