B&Q Suffers As Bad Weather Hits Profits

The owner of DIY chain B&Q has reported a sharp fall in profits, partly a result of "record adverse weather" in the UK.

Kingfisher, which is Europe's largest home improvements retailer and also owns Screwfix, said profits fell 11.4% in its last financial year to £715m.

It estimated that the soggy summer of 2012 in Britain took £25m off its earnings.

Wet or cold weather has been widely found to have stifled shop sales at a time when retailers also battled the prolonged squeeze in consumer spending.

Sellers of so-called "big ticket" items such as kitchens and bathrooms, like B&Q, have been particularly vulnerable because people have been reluctant to upgrade their homes amid other spending priorities.

Group sales fell 2.4% to £10.57bn in the year to February 2, with the company blaming weak consumer confidence for like-for-like sales declines in its three key markets of Britain, France and Poland.

The prolonged cold snap has hit wider retail sales across the UK

Like-for-like sales in the UK and Ireland fell 5.6% though Screwfix continued to grow.

Kingfisher cited adverse foreign exchange movements, when translating euro and Polish zloty overseas profits into sterling, for knocking £39m off profit.

It said it was offsetting weak demand with a drive to improve profitability by buying more goods centrally from cheaper manufacturing centres such as China.

Neil Saunders, Managing Director of retail analysts Conlumino, said there was a positive for Kingfisher despite its profits decline.

He said: "It is important to underline the fact that B&Q has actually gained share as its own declines have been less than those across the whole market.

"To a large extent this justifies the current strategy of investing in price which helps stimulate spend, defends against discounting activity at competitors and helps to make buying big ticket items like kitchens somewhat more palatable.

"The ongoing moves to make the process of DIY more engaging and interesting, through range and store improvements, has also helped B&Q beat the performance of the overall market."

He concluded: "That said, with the weather over the critical upcoming Easter period looking distinctly gloomy, 2013 looks like it will be another fairly bleak year for the DIY sector."

Recent industry figures have suggested the prolonged winter has impacted severely on shopper numbers as a whole, with not only DIY chains but clothing retailers also feeling the cold as people hold off buying Spring range items.

It remains to be seen whether the decline will have an impact on GDP to the extent it pushes the UK into a triple dip recession.

The Office of Budget Responsibility last week forecast just 0.1% growth in the first quarter of 2013.

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Dreamliner Test Flight 'According To Plan'

Boeing 787 Dreamliner Timeline

Updated: 10:20am UK, Tuesday 26 March 2013

The turbulent history of the Boeing 787 Dreamliner:

Mar 25, 2013: Boeing says its first test flight with the new lithium-ion battery went according to plan.

Mar 15, 2013: Boeing unveils modifications to its 787 batteries, saying the Dreamliner is "absolutely safe".

Mar 12, 2013:  FAA approves Boeing's certification plan for a new battery system for the aircraft.

Mar 7, 2013: US National Transportation Safety Board says it has failed to identify the cause of the Jan 7 fire.

Feb 28, 2013: Boeing says it has found a "permanent" solution to fix problems with Dreamliner batteries.

Feb 25, 2013: All Nippon Air (ANA) confirms all of its fleet will remain grounded until the end of May.

Feb 8, 2013: Boeing confirms it has sent letters to airlines expecting imminent deliveries of possible delays.

Feb 7, 2013: US Federal Aviation Administration (FAA) allows limited test flight of the grounded Dreamliner.

Feb 5, 2013: Japanese official reveal CT scans of failed batteries does not reveal fire cause.

Feb 4, 2013: Boeing requests FAA approval for test flights of grounded model.

Jan 30, 2013: Amid revenue loss forecasts of $500m to $5bn, Boeing CEO addresses investors and downplays impact.

Jan 28, 2013: Investigators widen battery examination to sub-contractors of lithium ion battery maker GS Yuasa

Jan 21, 2013: Safety officials start probe of lithium ion battery maker GS Yuasa

Jan 19, 2013: Boeing says it is stopping deliveries of the Dreamliner to airlines

Jan 18, 2013: FAA officials arrive in Japan to examine a 787 and its melted battery pack after an ANA emergency landing two days earlier

Jan 17, 2013: The European Aviation Safety Agency,  FAA and Qatar Airways ground Dreamliners under their regulatory control

Jan 16, 2013: Japan Air Lines Co Ltd (JAL) follows suit and suspends Dreamliner flights from Japan over safety concerns

Jan 16, 2013: ANA grounds all 17 of its 787s after four of its aircraft suffer problems

Jan 16, 2013: ANA 787 Dreamliner makes emergency landing in Takamatsu, Japan, after smoke appears in cabin

Jan 11, 2013: The Federal Aviation Authority (FAA) announces a review of the 787 design and systems

Jan 11, 2013: ANA discovers engine oil leak after a domestic flight lands at Miyazaki

Jan 11, 2013: A separate ANA flight to Matsuyama reported a crack appearing in the pilot's window

Jan 9, 2013: ANA cancels a Boeing 787 Dreamliner flight due to a brake problem

Jan 8, 2013: Japan Air Lines (JAL) grounds a jet at Boston Logan International Airport after a 787 leaks 150 litres of fuel

Jan 7, 2013: A fire erupts in a battery pack in another JAL Dreamliner at Boston

Dec 13, 2012: Qatar Airways grounds one of its Dreamliners because of a faulty generator

Dec 5, 2012: The FAA orders inspections of all 787 Dreamliners in service in the US

Dec 4, 2012: A United Airlines 787 is forced to make an emergency landing in New Orleans after a generator fails

July 23, 2012: ANA grounds five Dreamliners due to an engine component issue

Feb 22, 2012: Boeing says around 55 Dreamliners may be affected by a flaw in the fuselage

Oct 26, 2011: The Dreamliner makes its maiden flight with paying passengers on board an ANA jet

Sep 26, 2011: Boeing delivers its first 787 Dreamliner to Japan's ANA, three years late

Jun 23, 2010: Boeing postpones the first flight of the Dreamliner because of a structural flaw

Dec 15, 2009: The passenger jet 787 Dreamliner takes off on its maiden test flight

Apr 9, 2008: Boeing says there will be a revised plan for the first 787 flight and initial deliveries

Dec 11, 2008: Boeing announces further delays due to strike action by machinists Sept-Nov

Oct 19, 2007: Boeing says there will be a six-month delay to deliveries due to assembly issues

Jul 8, 2007: The first assembled 787 goes on display to media, employees and customers

Jul 18, 2006: Boeing says it is making "solid progress" on the 787 Dreamliner programme

Jan 28, 2005: Boeing gives its new commercial airplane an official model designation number - 787

Jan 29, 2003: Boeing announces the launch of a new aircraft called the 7E7

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Virgin 'To Bid For' East Coast Rail Line

The Department for Transport has invited companies to bid for the East Coast rail franchise, which is expected to be privatised in less than two years.

Virgin is expected to be among the parties interested in taking over the key line, which runs between London and Scotland, according to Sky sources.

The route has been run in the public sector since 2009 when the recession caused National Express to pull out.

Now Transport Secretary Patrick McLoughlin has unveiled plans to put it back in private hands by February 2015.

Mr McLoughlin announced a new approach to rail franchising following last year's botched West Coast deal - which was scrapped after flaws were found in the process.

The 13-year franchise was initially awarded to FirstGroup, which won a bidding war with the incumbent company Virgin Trains.

Sir Richard Branson's Virgin will run the West Coast line until April 2017

But a string of mistakes by Department for Transport staff saw the deal cancelled and led to two independent reviews into the rail franchising process.

Virgin will continue to run the West Coast service - which it has controlled since 1997 - until the new franchise date, which has been pushed back from November next year to April 2017.

Mr McLoughlin said the new franchise process will deliver improvements to services and bring long-term certainty to the market.

"Above all, in future franchise competitions we are placing passengers in the driving seat by ensuring that their views and satisfaction levels are taken into account when deciding which companies run our railway services," he said.

"Franchising has been a force for good in the story of Britain's railways, transforming an industry that was in decline into one that today carries record numbers of passengers."

But rail unions - angry at plans to privatise the East Coast line again - stressed that the private sector had twice given up the franchise.

RMT's general secretary Bob Crow said hundreds of millions of pounds of taxpayers' money had been wasted on the "franchising circus".

"Instead of learning the lessons of the privatisation disasters on the East and West Coast main lines and across the rest of the network, the Government has this morning given the green light to a whole new wave of profiteering that will have the train companies laughing all the way to the bank," he said.

"The proposed reprivatisation of the East Coast, after the public sector rescued the service following two private failures, proves conclusively that the political class have learnt absolutely nothing when it comes to our railways."

Manuel Cortes, leader of the TSSA rail union, added: "The £50m West Coast line fiasco revealed that private franchises are a shambles.

"So they go and privatise the only successful publicly-owned franchise, the East Coast line."

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Cyprus Facing 30% Unemployment Amid Crisis

By Tom Parmenter, Sky Correspondent, in Nicosia

Cyprus is facing a recession so deep that 30% of people may find themselves unemployed.

The EU bailout means massive restructuring of the financial system, the inevitable loss of many investors and thousands of people seeing their jobs disappear.

Professor Hari Tsoukas, a business analyst, told Sky News: "Unemployment is likely to at least double from 14% to at least 25% and possibly up to 30%. Not so long ago it was just 5%.

"It is a huge challenge now facing the Cypriot people, we have been resilient before and we will need all that again," he added.

For a week now people have been rationed to how much they can withdraw from cashpoints.

Wages have not been paid, businesses have been unable to pay suppliers and the whole economy has seized up.

Banks have been closed since March 16 but Cyprus' president Nicos Anastasiades has said they will reopen on Thursday.

A woman and child beg for money in Nicosia

However, he added that the island will introduce some limits on transactions to prevent a huge outflow of money.

Politicians have been struggling to come up with a plan that would raise enough funds to qualify for an international bailout.

In a televised address to the country, the president said: "The central bank will implement capital controls on transactions. I want to assure you that this will be a very temporary measure that will gradually be relaxed."

He did not specify what limitations would be imposed on transactions.

He said he had taken "painful decisions to save the country from bankruptcy" and pledged Cyprus "would find its feet again".

It follows a bailout deal which reports suggest could see Bank of Cyprus savers with deposits above 100,000 euros (£85,000) hit with a levy of "around 30%".

In a smart fourth floor apartment, Sky News met one Cypriot woman prepared to show us where she has been stashing her money.

Fearful of losing control of her cash by leaving it in the bank she now has a daily routine of hiding it in drawers or cupboards around her bedroom.

She didn't want to be identified but said: "You just want to know your money is safe, this is quite small scale but it is all I can do."

Her flat was burgled last year so she is taking no chances - every time before she leaves home for over an hour she collects together her growing stash of notes and takes it with her stuffed in her handbag.

She hates having to do it but while banks remain closed some people feel they have little option but to take control of their own money.

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Major Emerging Economies 'To Seek Bank Deal'

When British economist Jim O'Neill coined the acronym BRIC in 2001, he can't have imagined it would turn into a genuine multi-nation alliance with an annual summit.

BRIC stands for Brazil, Russia, India and China. It now has a fifth member: South Africa. Together, the BRICS make up an alliance of developing countries who represent a shift in global economic power away from the established developed countries.

They'll meet over the next two days for their fifth annual summit. This year, the newest member, South Africa, is the host and Durban is the venue.

The big issue will be reinvigorating growth. To do that, they'll discuss the establishment of a 'BRICS bank' to rival traditional financial institutions which are widely seen as reflecting the interests of industrialised countries.

A glance at the BRICS vital statistics and it is clear that they are a potentially powerful bunch.

Together they represent a quarter of the world's landmass, nearly half the world's population and a little over a third of global trade.

The BRICS bank would effectively be a Development Bank designed to improve infrastructure within each of its five member states: in part, an alternative to the International Monetary Fund (IMF).

Infrastructure problems are widely seen as obstacles to accelerated economic growth in Brazil, India and South Africa.

Investment in infrastructure would do two things. Short term, it would stimulate the countries' economies and provide jobs. Longer term, the new and improved infrastructure would provide a platform to accelerate growth.

That is where the BRICS bank comes in. It could provide the funds for the infrastructure. But there are significant disagreements between the member states. How much would each of the five countries contribute? Where would the bank be headquartered?

One suggestion is $10bn (£6.6bn) each. That wouldn't be a problem for China but would represent a huge struggle for South Africa which makes up just 3% of the BRICS total economic mass.

The BRICS first summit was held just before the global crash of 2008. Plenty has changed since then and while the BRICS countries still dominate the emerging markets, their growth momentum has slowed massively.

With those pressures, the BRICS may now represent five countries who are aligned together and against the developed economic establishment but not necessarily wholly allied with each other.

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Summly: Yahoo! Buys Nick D'Aloisio's App

The teenage founder of news app Summly has said he is "more motivated" to develop other services despite already becoming a millionaire.

Nick D'Aloisio, 17, this week sold his app to web giant Yahoo! in a multimillion-pound deal. The exact value has not been disclosed.

The teenager's creation will end in its current form and instead be integrated into Yahoo!'s products.

"Longer term this whole journey has given me an appetite for starting companies, so I'd love to do it again," he told Sky News.

Summly pulls in news articles from online sources and uses an algorithm to identify key points, turning them into 400-character bite-sized summaries which can easily be read on mobile phones.

For now though, the London teenager says he's looking forward to becoming Yahoo!'s youngest employee - part of this week's deal sees Nick join the company.

"There's so much opportunity with what they're trying to do in the mobile ecosystem and what we were doing with Summly," he said.

Nick developed the app when he was 15 and it received investment from Hong Kong billionaire Li Ka Shing's Horizons Ventures, as well as some celebrity backing.

Summly's functions will now be moved over to Yahoo! products

Stephen Fry, Yoko Ono and Ashton Kutcher all contributed to an investment of more than £1m.

"I thought of the idea after I revised for my history GCSE," said Nick. "There's so much information on the web (and) the question is can you do it algorithmically without a human."

The iPhone app launched in December 2012 and Summly worked with around 250 online publishers to make sure it worked smoothly with their content.

It has been downloaded nearly a million times.

The Wimbledon teenager said he taught himself basic programming at the age of 12 after he saw the chance to develop for the newly-released App Store.

He told Sky News that aspiring technology millionaires should stay determined if they have a concept they believe in.

"The real goal is to get it out there because if it's a great idea and you persevere it will get discovered.

"Investors are looking for new companies," says Nick.

And, despite becoming rich, he does not have any extravagant purchases planned.

"We (my family) will probably go out to dinner or something like that," he said.

"I'm getting maybe a new pair of trainers I think - I'll get something small like that as a memento."

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New Bank Start-Ups Given Helping Hand

Regulators have confirmed plans to boost competition in the banking sector, by easing the barriers facing new banks.

The Financial Services Authority (FSA) and Bank of England (BoE) want to speed up the timetable for authorising new banks to within six months and provide up-front support during the application stage.

They also agree that relaxing the capital ratio requirements for start-ups to 4.5% against up to 9.5% for major existing banks should make it easier for newcomers to attract potential investors.

The UK's banking sector is currently dominated by RBS, Barclays, HSBC and Lloyds Banking Group and recent bank entrants such as Metro Bank and Aldermore have struggled to cash in on public anger over the fall out from the financial crisis.

Four banks currently dominate the UK market

FSA chairman Lord Turner said the proposals were bold changes that responded to the difficulties being faced by applicant firms.

He said: "We believe the changes will make a significant difference to the ease with which new firms can enter the UK banking system and, as a result,

enable an increased competitive challenge to existing banks."

The move was welcomed by Metro Bank co-founder Anthony Thomson.

He told Sky News: "There is a real appetite amongst consumers for a new, different form of banking...it will give them more choice and force the existing banks to give customers a better deal."

It is expected that the rule changes will benefit potential buyers of 315 branches being sold by RBS.

On Monday the FSA will be replaced by the Financial Conduct Authority and the Prudential Regulation Authority, both of whom will need to approve new entrants.

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BlackBerry Shares Drop Over Z10 Phone Worries

BlackBerry's share price has taken a further hit on the US stock market, falling 4.5% at the close of play on Monday.

In total, the company's stock has now lost more than 11% on the Nasdaq since the company's new phone, the Z10, went on sale in the US on Friday.

Markets reacted negatively to investment bank Goldman Sachs changing its position on BlackBerry's shares from "neutral" to "buy".

Goldman claimed its outlook was based on "tepid" US sales and poor marketing support.

"Our retail ​checks at over 20 store locations ... revealed a surprising lack of marketing support and poor positioning of the product," said Goldman analyst Simona Jankowski.

"We also saw limited advertising around the launch."

The report gives the handset a 20% chance of success, down from 30%.

BlackBerry has lost market share in recent years to the iPhone and Android devices. Its reputation was also damaged after much-publicised service disruptions.

Thorsten Heins, the company's chief executive, launched the BlackBerry 10 handsets in January in Canada and the UK. The Z10 is the first BlackBerry to feature a full touchscreen.

The new phones are seen as crucial in turning around the fortunes of the company,

Initial non-US sales exceeded expectations according to Mr Heins, with reports of some UK stores selling out. Reviews of the phone have also been generally positive.

And the company's share price could claw back some of its value when it reveals its fiscal fourth quarter results on March 28.

BlackBerry was asked to comment, but did not immediately respond.

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Fifty Shades Sees Publisher In Rude Heath

Random House has said the Fifty Shades trilogy - its fastest-ever selling series - helped boost its revenue by more than 20% last year.

The publisher sold more than 70 million copies of EL James' erotic novels in print, audio and e-book format in English, German and Spanish.

Its popularity helped the company report a record financial year for 2012, with revenues up 22.5% at 2.1bn euros (£1.78bn).

"The world's leading trade publishing group harnessed the power of its content portfolio, most notably the Fifty Shades trilogy," the publisher's parent company Bertelsmann said in a statement.

Random House said it published 28 UK number one bestsellers and almost a quarter of all titles on the Sunday Times bestseller list last year.

It also named Lee Child's A Wanted Man, Rod Stewart's autobiography and Private Games by James Patterson as popular titles.

But despite strong sales at Random House, Bertelsmann's profit rose only slightly, to 619m euros (£525m), from 612m euros the year before.

The German media group also warned of a possible fall in earnings looking ahead.

"Given the low overall economic growth in the euro region... and increased investments, we expect a stable or slightly declining business performance in 2013," said chief executive Thomas Rabe.

Last year, Bertelsmann and Pearson announced plans to merge Random House and Penguin to create the world's leading publisher.

If approved by regulators, the deal is expected to be finalised later this year.

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Cyprus Moves To Prevent Run On Banks

Cyprus Facing Jobless Total Of 30%

Updated: 10:40am UK, Tuesday 26 March 2013

By Tom Parmenter, Sky Correspondent, in Nicosia

Cyprus is facing a recession so deep that 30% of people may find themselves unemployed.

The EU bailout means massive restructuring of the financial system, the inevitable loss of many investors and thousands of people seeing their jobs disappear.

Professor Hari Tsoukas, a business analyst, told Sky News: "Unemployment is likely to at least double from 14% to at least 25% and possibly up to 30%. Not so long ago it was just 5%.

"It is a huge challenge now facing the Cypriot people, we have been resilient before and we will need all that again," he added.

For a week now people have been rationed to how much they can withdraw from cashpoints.

Wages have not been paid, businesses have been unable to pay suppliers and the whole economy has seized up.

Banks have been closed since March 16 but Cyprus' president Nicos Anastasiades has said they will reopen on Thursday.

However, he added that the island will introduce some limits on transactions to prevent a huge outflow of money.

Politicians have been struggling to come up with a plan that would raise enough funds to qualify for an international bailout.

In a televised address to the country, the president said: "The central bank will implement capital controls on transactions. I want to assure you that this will be a very temporary measure that will gradually be relaxed."

He did not specify what limitations would be imposed on transactions.

He said he had taken "painful decisions to save the country from bankruptcy" and pledged Cyprus "would find its feet again".

It follows a bailout deal which reports suggest could see Bank of Cyprus savers with deposits above 100,000 euros (£85,000) hit with a levy of "around 30%".

In a smart fourth floor apartment, Sky News met one Cypriot woman prepared to show us where she has been stashing her money.

Fearful of losing control of her cash by leaving it in the bank she now has a daily routine of hiding it in drawers or cupboards around her bedroom.

She didn't want to be identified but said: "You just want to know your money is safe, this is quite small scale but it is all I can do."

Her flat was burgled last year so she is taking no chances - every time before she leaves home for over an hour she collects together her growing stash of notes and takes it with her stuffed in her handbag.

She hates having to do it but while banks remain closed some people feel they have little option but to take control of their own money.

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