Shop Direct and Jaeger post online sales boost over Christmas

Jaeger and Shop Direct both got a boost from online shopping over Christmas. Photograph: Brian Jackson / Alamy/Alamy

The Barclay brothers' Shop Direct and fashion brand Jaeger have both reported big increases in online and mobile sales over Christmas.

Shop Direct, which Daily Telegraph owners Sir David and Sir Frederick Barclay own via their offshore family trust, reported record Christmas sales with online accounting for 84% of sales in the six weeks to 27 December. Overall sales were up 5% as growth of newer websites Very.co.uk and isme.com offset falling sales from the traditional Littlewoods business.

Alex Baldock, chief executive, said mobile sales had "just exploded" and purchases via a smartphone or tablet now accounted for 43% of online sales.

He said consumers were becoming much happier shopping on their phones and tablets despite having to make do with smaller screens than on desktops or laptops. "People look at it on the way to work, and continue on the bus," he said. "People quite often buy on the bus, buy in the queue at McDonalds. People are even prepared to buy furniture through their mobile."

Baldock said the company, which returned to profit last year for the first time in a decade, was "ahead of sales and profit targets". The company is involved in a long-running dispute over a decades-long £1bn VAT and interest claim.

He described the company's "bullseye customer" as a "25-year-old plus female, aspiring and striving".

Colin Henry, chief executive of Jaeger, described his customers as an "affluent demographic" of mostly older women, but has also been struck by their desire to shop online and on mobile.

Online sales in the 13 weeks to 28 December were up 57%, and 30% of that was from mobiles. He said he expected all transactions to include a mobile device at some point in the browsing and sales process by next year.

Like-for-like sales were up 23% compared with the same period last year and Henry said the business, which lost £13.1m last year and £35m the year before, is "going to lose much, much less money" this year.

Private equity tycoon Jon Moulton's Better Capital bought Jaeger, which dates back to 1884, from fashion entrepreneur Sir Harold Tillman in April 2012.

Henry said Moulton was "very inspirational with very clear objectives" and was often on the phone asking questions and offering advice.

He said they would look at the option of expanding the brand to new stores and countries when they have stabilised the company and returned it to profit.

Best sellers in the run up to Christmas were coats, knitwear and cashmere. Womenswear accounts for 70% of sales.

The company has brought in former Daks and Oscar de la Renta designer Sheila McKain-Waid as womenswear creative director, and Jsen Wintle, who previously ran his own popular Wintle label, to reinvent its menswear.

Carmaker BMW keeps luxury top spot with record 2013 sales

The German company said it sold 1.66mn BMW brand vehicles, 7.5% more than the previous year

BMW kept the luxury car top spot in 2013 against rivals Audi and Mercedes. Photograph: Miguel Villagran/Getty Images

BMW has posted record sales for 2013, keeping its No 1 spot in the market for high-priced cars against its German competitors Audi and Mercedes.

The Munich-based luxury carmaker said on Monday it had sold 1.66m vehicles under the BMW brand, 7.5% more than the previous year.

BMW also increased sales of the Mini and Rolls-Royce, with Mini sales hitting a record 305,000 vehicles, up 1.2% from 2012. The US remains the largest market for the compact car with 66,000 sold last year, followed by 53,000 in the UK.

Rolls-Royce increased its unit sales by 1.5% to 3,630 as the new Wraith model – a "fastback" with sloping roofline and striking two-tone paint options – saw its first deliveries to customers in the fourth quarter.

Sales of BMWs were boosted by strong sales of the brand's mainstay 3-series sedan and X1 small SUV as well as by rising demand in China and the US. Sales of the 3-series rose 23%.

Volkswagen AG's Audi division last week reported sales of 1.57 million last year and Daimler AG's Mercedes-Benz brand came in at 1.46 million. The three carmakers are pillars of Germany's export-focused economy and have reaped fat earnings selling luxury cars and SUVs – which earn higher profits per vehicle than mass-market vehicles – in the United States and in emerging markets, led by China.

The competition among the three heats up on Monday at the start of the North American International Auto Show in Detroit, where Mercedes is introducing a new version of its C-Class that will compete with the BMW 3-series. BMW is showing off its new 2-series small sports coupe.

BMW sales chief Ian Robertson credited the company's model lineup and "balanced sales distribution across all continents." He forecast that "despite difficult conditions in many markets," the company would increase sales yet again in 2014

Fracking in the UK: 'We're going all out for shale,' admits Cameron

Environmentalists say prime minister's plan to grant councils 100% of business rates from fracking amounts to a bribe

A shale gas drilling rig in Weeton, Lancashire. Photograph: FLPA/Alamy

David Cameron is to declarethat his government is "going all out for shale" as he announces that councils will be entitled to keep 100% of business rates raised from fracking sites in a deal expected to generate millions of pounds for local authorities.

In a renewed attempt to win support for the controversial expansion of fracking, the prime minister will also say that revenues generated by shale gas companies could be paid directly in cash to homeowners living nearby.

The prime minister's announcement, likened to a bribe by environmentalists, comes on the day that the French energy group Total becomes the first global oil company to invest in a shale gas exploration project in Britain. The FT reported on Saturday that Total is to join a shale gas exploration licence in the Midlands operated by the US company Ecorp.

The prime minister will make a new pitch to shore up support for fracking amid concerns about the use of high-pressure water and chemicals to fracture underground rock, thereby releasing trapped gas. New fracking sites have opened up in the Midlands, Cumbria and Wales.

Cameron, who is to visit a fracking site, will announce that the government is to double from 50% to 100% the amount that councils in England can keep in business rates raised from shale gas sites. The offer, which was proposed last year by the Institute of Directors, could be worth up to £1.7m a year for a typical site.

The prime minister will also try to reach out to concerned local communities by saying that the industry will consult on how to distribute funds of up to £5m-£10m for a typical site over its lifetime – a lump sum of £100,000 when a test well is fracked, plus 1% of revenues. Direct cash payments could be made to homeowners living near fracking sites.

Cameron will say: "A key part of our long-term economic plan to secure Britain's future is to back businesses with better infrastructure. That's why we're going all out for shale. It will mean more jobs and opportunities for people, and economic security for our country."

George Osborne, who has spoken of the "huge potential" of shale gas, announced plans in his autumn statement last month to halve the taxes levied on fracking companies exploring for the gas. He told MPs: "We are prepared to push the boundaries of scientific endeavour, including in controversial areas, because Britain has always been a pioneer. The country that was the first to extract oil and gas from deep under the sea should not turn its back on new sources of energy like shale gas because it's all too difficult."

Jane Thomas, senior campaigner at Friends of the Earth, likened the decision to grant councils 100% of business rates from shale gas companies to a bribe. Thomas said: "Today's announcement from the government that councils can keep all the business rate revenue they receive from fracking companies marks a new low in the government's attempts to curry fracking favour with local people.

"Friends of the Earth believe that this is the first time that government money is being use to incentivise local communities. These community sweeteners also raise huge concerns about conflicts of interest if those councils who potentially will benefit from this money are also the ones who determine the planning applications from fracking companies in the first place."

James Sproule, chief economist at the Institute of Directors, said: "The IoD recommended last year that the government allow local authorities to keep 100% of the business rates from shale sites, so we very much welcome this as another encouraging step in the right direction. It's vital that local communities see the benefits of new industry in their area, and this announcement sits alongside existing plans to support communities connected with the development of shale gas.

"Investment from Total is a vote of long-term confidence in the UK shale industry, and is a welcome sign that the government is creating the conditions necessary to maximise the potential benefits of a new domestic energy source. The wider benefits are clear; shale gas development could create tens of thousands of jobs, reduce imports, generate significant tax revenue and support a resurgence in British manufacturing. In short, shale gas could be a new North Sea for Britain."

Tom Greatrex, the shadow energy minister, said: "Gas will remain an important part of our energy mix in the future, and if shale gas can replace our rapidly depleting North Sea reserves it could help improve our energy security. It is right that any communities that host nationally significant energy infrastructure are able to share in its rewards.

"But the government must get its priorities right. Only by fully addressing legitimate environmental and safety concerns about fracking with robust regulation and comprehensive monitoring will people have confidence that the exploration and possible extraction of shale gas is a safe and reliable source that can contribute to the UK's energy mix."

Airbus claims to have overtaken rival Boeing after record sales in 2013

Airbus received 1,619 aircraft orders and delivered 626 aeroplanes, and now has a healthy backlog, says president

Airbus's chief operating officer, John Leahy, says the company has now taken a 53% market share in revenue and net orders. Photograph: Regis Duvignau/Reuters

Airbus achieved record sales and deliveries of aircraft in 2013, the manufacturer has announced, claiming to have edged its great rivalBoeing for market share.

But it admitted it would probably hand that particular crown back to its American counterparts in subsequent years to focus on increased production, as its orders have built up a nine-year backlog on deliveries.

Its total of 1,619 aircraft orders, valued at up to $240.5bn, exceeded its 2011 previous best by 11, while the 626 planes delivered represented a 12th consecutive year of growth.

The president and chief executive, Fabrice Bregier, said that with a total of 5,559 outstanding orders, or about nine years of production at current rates, Airbus had an extremely healthy backlog before what would be a significant year.

This year will see the A350 entered into service, a direct competitor in scale to Boeing's pioneering Dreamliner, as well as the first flight of the A320neo, its upgraded bestselling single-aisle plane.

Bregier said the orders had strengthened Airbus's belief that airlines were moving towards buying larger models. "In each category the customer tends to select the slightly bigger aircraft."

He said: "The A350's slightly bigger size makes it more appealing than the [Boeing] 787. This will also be the case for the A380, I am convinced."

While the A380, Airbus's flagship double-decker super jumbo, dominates the market for very large planes, only its most committed customer, Emirates, ordered any of the aircraft in 2013, with an order for 50 in December.

Bregier said the year's other highlights had been the successful test flights of the A350 and the company making a significant breakthrough into the Japanese market – regarded as a Boeing fortress by Airbus – with an order for 31 of the new model.

He said: "We believe that this has a strategic significance for Airbus and the positioning of the A350 in the market."

Bregier said the company would now be focusing on incremental innovations that could quickly be delivered to the marketplace, with the A350 and the A320neo completing the Airbus range for the next 15 to 20 years.

The chief operating officer, John Leahy, said Airbus had now taken 53% market share in revenue and net orders. But Bregier conceded that orders had so outstripped deliveries that the company would be likely to see Boeing back in front in the next few years. But he said: "This is not the biggest challenge for Airbus. My problem is finding slots to deliver."

Airbus is in discussion to extend its Chinese operations, with its final assembly plant in Tianjin having now delivered more than 150 aeroplanes.

While all eyes will be on the A350 when it comes into service later this year, Bregier stressed the plane was based on "much more mature" technology than the Boeing 787, which was plagued by teething problems in 2013, leading to its eventual withdrawal from service.

Bregier meanwhile said that Airbus was still considering asking the European commission to lodge a complaint over what he described as cynical and possibly illegal multibillion-dollar subsidies paid to Boeing by Washington state in the US

Japan's Suntory buys maker of Jim Beam bourbon

Jim Beam maker Beam Inc is being sold to Japan's Suntory in a $16bn deal. Photograph: Bloomberg/Bloomberg via Getty Images

The American drinks group behind Jim Beam bourbon as well as Scotch whiskies Teacher's and Laphroaig has been sold to Japanese whiskydistiller Suntory as part of a $16bn deal.

Illinois-based Beam Inc is best known as the maker of Kentucky bourbons such as Knob Creek and Maker's Mark, as well as the eponymous Jim Beam, but the group's drinks cabinet draws together brands from around the world, including Sauza tequila, Courvoisier cognac and Harvey's Bristol Cream to generate annual sales of $2.51bn.

The agreed sale of Beam follows shortly after Suntory completed its acquisition of drug group GlaxoSmithKline's legacy soft drinks business, including the Ribena and Lucozade labels, for £1.35bn. The Japanese whisky and beer group is already well-known for acquiring the Orangina brand a little over four year ago. The company also holds the rights to bottle Pepsi and Schweppes in some countries.

The sale of Beam, which offers shareholders a 25% premium to the recent share price, will trigger a colossal windfall for activist shareholder Bill Ackman's Pershing Square hedge fund, which is thought to hold 12.8% of the stock.

Ackman is widely credited with grooming the business for a sale by pressing for its 2011 demerger from a sprawling conglomerate which was then called Fortune Brands, with interests ranging from Moen taps and Mast Lock security products to Titleist golf equipment. On completion of the sale to Suntory, Beam will have delivered a 106% return for its shareholders since becoming a stand-alone business in October 2011, chairman David Mackay said as he urged shareholders to support the deal.

Ackman's long-fought success at Beam comes just two months after he admitted his aggressive short position in New York-listed vitamin supplements group Herbalife was "$400m to $500m" in the red. He nevertheless insisted he still believed this short bet — which has dragged him into a public disagreement with fellow hedge fund tycoon Carl Icahn — would eventually be vindicated. Other US stocks on which Ackman has brought his activist views to bear include Wendy's, Target Corporation and Borders Group.

The acquisition of Beam by Suntory is thought to be the third largest acquisition of an overseas business by a Japanese corporation. The only larger foreign deals were SoftBank's purchase of US rival Sprint Nextel, and Japan Tobacco's acquisition of Britain's Gallaher, the firm behind Benson & Hedges cigarettes.

Now a global drinks group with sales of 1.85tr yen (£11bn), Suntory started life in 1899 as a wine producer and importer in Osaka, founded by Shinjiro Torii. In the 1920s, his firm laid claim to having developed the first Japanese malt whisky, which became known as Tory's Whisky.

The British and French brands within the Beam stable are largely the legacy of Fortune Brand's participation, along with Pernod Ricard, in the 2005 break-up acquisition of London-listed drinks group Allied Domecq. Two years later Fortune Brands went on to sell its wine interest to another US group, Constellation Brands.

Suntory chairman Nobutada Saji said the acquisition of Beam would make the enlarged group the world's third largest maker of premium spirits, with combined sales of $4.3bn. "With particular strength in Bourbon, Scotch, Canadian, Irish and Japanese whisky, the combined company will have unparalleled expertise and portfolio breadth in premium whisky, which is driving the fastest growth in Western spirits.

Treasury promises to honour UK debts up to date of Scottish independence

Statement is intended to calm anxieties about risk that Scotland could refuse to pay share of debt in quarrel over sterling

Alex Salmond has linked post-referendum negotiations on sharing UK debt with demands for a new sterling currency union. Photograph: David Cheskin/PA

The Treasury has pledged to honour all UK debts up to the date ofScotland's independence in an effort to reassure investors and stop interest rates rising.

The Treasury statement, issued on Monday, is designed to head off concerns about the risks that an independent Scotland could refuse to pay all or part its share of the UK's £1.4 trillion debt in a quarrel over sharing sterling.

Alex Salmond, the first minister, has linked post-referendum negotiations on sharing the UK's debt with his demands for a new currency union, saying that without a deal on sterling Scotland might refuse to pay its share of historic UK debt.

The Treasury statement said the UK government would "in all circumstances honour" the terms of all its debts agreed before the referendum, regardless of whether it and a future Scottish government reached a deal on how to repay Scotland's share.

The Treasury clarified earlier reports which tied the debt promise to referendum day this September, confirming that the pledge applied until Scotland was legally declared an independent state – mooted as March 2016 by Scottish ministers. But the Treasury refused to discuss any deal on how to divide up the UK's debt before the referendum.

A deal to divide it based on Scotland's population could add tens of billions to the bill compared with a formula based on the historic value of North Sea oil revenues to the UK, which would boost Scottish payments into the national accounts.

The Treasury also revealed that rather than transferring Scotland's share of the UK's debt after independence to a new Scottish exchequer, it would continue to control and service all its current debts, including Scotland's share after independence.

Instead, Scotland would be expected to reimburse the Treasury for its share of the debt and "would need to raise funds" to do so – a gambit designed to raise new questions about the higher interest rates and deeper public spending cuts an independent Scotland would be expected to face.

Speaking as the Treasury statement was released, Salmond said that option was common sense, since the UK government was legally bound to honour the terms of its outstanding debts. His government's economic advisers had already suggested this arrangement.

But Salmond again stated that a deal on debt was linked to a deal to share sterling.

"We remain prepared to negotiate taking responsibility for financing a fair share of the debts of the UK provided, of course, Scotland secures a fair share of the assets, including the monetary assets," he said.

Salmond added that the Treasury position strengthened his government's hand on a currency pact, since it made far greater economic sense for both economies to have close monetary ties.

He added that this proposal had majority support among English, Welsh and Northern Irish voters in an SNP-commissioned opinion poll published during Christmas.

"That position is now beyond argument and today's announcement makes clear that Scotland would be in an extremely strong negotiating position to secure that fair deal," Salmond said. "The UK government, and the no campaign, would be well advised to stop all the bluff and bluster around these matters and accept our offer of sensible discussions."

Treasury ministers fear Salmond's threats on debt could make the UK's borrowing before the referendum more expensive, and that could, said Alistair Darling, a former Labour chancellor, force up interest rates, mortgages and borrowing for businesses and consumers.

The markets are not showing signs of significant anxieties about September's vote, because opinion polls are consistently showing support for independence at about a third of Scottish voters.

But Treasury officials said they and the UK Debt Management Office had been approached by investors seeking reassurances about the status of UK gilts because of the referendum.

The Treasury's decision to offer a "cast-iron" guarantee could be seen to weaken its hand in post-referendum negotiations, by appearing to cushion Scottish ministers from the risk of defaulting on Scotland's share of the debt.

But the Treasury says its pledge strengthens the UK government's hand by showing it is taking a responsible position, regardless of the outcome of post-referendum talks. That puts the onus on Salmond to take a mature position on Scotland's debts.

Treasury ministers and Darling reject Salmond's claims that sterling is a physical asset that can be shared or split up; they say sharing a currency is a political decision that requires public consent.

Danny Alexander, the chief secretary to the Treasury, said it tested Salmond's credibility on debt and a currency pact: threatening to default on Scotland's share of debt would be "absolutely disastrous" for the Scottish government's credibility among lenders.

"[Scotland] would need to raise a lot of money in the markets to retain its financial independence and credibility and the worst thing in the world would be to start its life as a new state with a default on its debt obligations; that would be terrible for an independent Scotland," Alexander said.

Prof David Bell, an economist at the University of Stirling doing detailed work on the economics of independence, said Scotland would face additional costs after independence because lenders would charge a new, smaller state more for its borrowing.

While the UK's borrowing costs would also rise after independence, because of the costs of doing a deal with Scotland, lenders would also expect tough controls on Scotland's state spending. Any threat not to repay its debt would damage its standing.

Taxpayers group criticises £250,000 spending on MPs' portraits

Twenty-one parliamentarians were painted or sculpted in decade, including John Bercow, Ken Clarke and Diane Abbott

Iain Duncan Smith with his portrait by Paul Benney, at Portcullis House. Photograph: Graham Turner for the Guardian

MPs have spent almost £250,000 on paintings and sculptures of their colleagues, including thousands on portraits of the Tory cabinet ministers Iain Duncan Smith, William Hague and Ken Clarke.

The spending was revealed under a freedom of information request by the Evening Standard, which showed that almost £22,000 was spent on commissioning a portrait of John Bercow, the Commons Speaker, unveiled in 2011.

Critics said the large outlay on paintings of politicians was an expensive vanity project, but Commons officials said portraits were commissioned to record those who had made a significant contribution to UK political life.

The document revealed that 21 parliamentarians were painted or sculpted between 2000 and 2010, costing an average of £7,000 to £9,000 each. Fewer have been ordered in recent years because of budget cuts.

Around £11,750 was spent on a full-sized statue of Margaret Thatcher. Her successor as prime minister, John Major, was honoured with a bronze bust costing £6,000.

Several former Tory opposition leaders were made the subject of artworks, including Hague, now foreign secretary, for £4,000; Iain Duncan Smith, now responsible for benefit reforms as work and pensions secretary, for £10,000; and Lord Howard, for £9,400. The former chancellor Ken Clarke's portrait cost £8,000.

From Labour, portraits of Diane Abbott, the Hackney North MP, and Margaret Beckett, the former foreign secretary, cost the public purse £11,750 each, and pictures of the leftwingers Dennis Skinner and Tony Benn cost £2,000 each.

A number of ex-Lib Dem leaders were also painted, including Sir Menzies Campbell at a cost of just over £10,000 and Lord Ashdown for £2,000.

Tony Blair was painted alongside the then opposition leaders Hague and Charles Kennedy in a triptych costing £6,000.

Jonathan Isaby, chief executive of the TaxPayers' Alliance, said: "While the public might expect former prime ministers or speakers to be afforded the honour of a painting or bust in parliament, it would certainly seem that the net is being cast increasingly wide when it comes to identifying subjects.

"When photographs are so much cheaper than paintings, politicians need to think twice about spending our money immortalising themselves or their friends on canvas, or even in bronze."

A Commons spokesman said: "The parliamentary art collection at theHouse of Commons records those who have made a significant contribution to UK political life over the centuries and in each parliament the Speaker's advisory committee on works of art endeavours to update this record by adding to the contemporary portrait collection.

"In recent years the annual budget for acquiring works of art for the collection has been reduced to reflect the need for savings in the current economic downturn. This is part of the House's drive to reduce its overall cost by 17% by 2014/15."