UPDATE 1-Dunelm profit to top forecasts, outlook tougher

LONDON, July 13 (Reuters) – British homewares retailer Dunelm (DNLM.L) forecast a tougher outlook for both sales and profit margins on Tuesday, even as it said profits for the year ended July 3 would be a little ahead of analysts’ expectations.

The group, which sells products such as curtains, bedding, blinds, rugs and lighting from mostly out-of-town stores, said sales at stores open at least a year rose 0.8 percent in the second half of its financial year, down sharply from a 15.4 percent increase in the first half.

The gross profit margin over the full year rose 190 basis points to 46.8 percent, ensuring that annual operating profit would be “a little ahead of current market expectations.”

But Dunelm also warned of tougher times ahead, as Britain takes steps to reduce record government borrowing.

“We do not anticipate that it will be possible to maintain last year’s rate of like-for-like sales growth in the coming twelve months as consumer spending has to absorb tax increases, public sector cuts and, potentially, interest rate rises,” Chief Executive Will Adderley said.

“We also think it will be hard to achieve further gross margin gains, with uncertainty over sterling and recent increases in freight costs affecting imported products.”

Dunelm shares have performed broadly in line with the UK general retail index .FTASX5370 this year. They closed at 358 pence on Monday, valuing the business at about 709 million pounds ($1.1 billion). (Reporting by Mark Potter; Editing by Louise Heavens)

Chinese express regret, anger at Google move

Young Chinese professionals working in Beijing’s main IT hub expressed a mixture of regret, anger and surprise on Tuesday at Google’s move to shut its mainland Chinese website and reroute searches to Hong Kong.

The government lost little time in warning Google that its rejection of self-censorship has incensed the ruling Communist Party, wary of ceding any ground on freedoms for China’s 384 million Internet users.

But for many educated, and especially young, Chinese, Google has been a well-loved website, even if homegrown rival Baidu Inc dominates the overall domestic market.

And many fear Google’s move on its search engine could affect its other offerings, from email to online books.

“It’s a regrettable decision,” said Chen Wen, 28, who works in finance in Beijing’s Zhongguancun IT district, where Google has its China headquarters.

“I think it was inevitable though. The government was never going to compromise on filtering,” he added, as he walked past the Google offices. “China needs this company. It’s a great loss for the country.”

Google threatened on Jan. 12 to pull of China if it could not offer an uncensored version of its Google.cn search portal. On Monday, Google said it was rerouting users to the company’s Hong Kong site, google.com.hk, putting the burden on Beijing to apply its own censorship filters to keep Chinese users from seeing banned images and words.

You Chuanbo, 25, said he foresaw an unhappy outcome now that Google had stopped censoring searches.

“That is not going to last long. The government will just end up blocking access to all of Google,” added You, who works for a computer company and regularly uses Google, as well as Baidu.

At the Google offices, blinds were drawn on most of the windows, as workers scurried past a gaggle of reporters waiting outside in the morning chill, without talking.

A few employees peered out from behind the blinds to take pictures of the assembled groups of journalists.

One man walked up to the building to lay flowers at the Google sign in front of the office, saying simply: “I feel very sad”. He declined to identify himself or say anymore, and walked quietly away.

Other passersby stopped to take pictures of the building using cameras on their mobile phones.

“I use Google in English every day for research,” said IT engineer Wang Fei. “I need it for my job, and I’m worried about what’s going to happen.”

Reactions were more intense on the Internet, which has seen many passionate postings since the Google drama began some two months ago.

“Hong Kong is also Chinese territory. Hurry up and leave China once and for all!” wrote one reader on the website of the nationalist Global Times newspaper (www.huanqiu.com).

Others congratulated the company, or celebrated its move as a major salvo in a long-running war against government controls.

“Chinese netizens salute you Google. You are really brave,” wrote blogger Tingting on the popular sina.com.cn portal.

Another blogger, Peng Deng, said in the end the government would only lose its battle with censorship.

“Online, everything is possible. There’s no way the government’s hackers can block the technology of millions of users,” Peng wrote.

(Additional reporting by Beijing newsroom; Editing by Ken Wills and Lincoln Feast)
Ben Blanchard

Israel using controversial white phosphorus shells in Gaza

London, Jan 5 (ANI): To screen its assault on the heavily populated Gaza strip, Israel is believed to be using controversial white phosphorus shells, whose use is banned under the Geneva conventions as an offensive weapon against civilians, but its use as a smokescreen is not prohibited by international law.

The weapon, used by British and US forces in Iraq, can cause horrific burns but is not illegal if used as a smokescreen, The Times reported.

As the Israeli army stormed to the edges of Gaza City and the Palestinian death toll topped 500, the shells could be seen spreading tentacles of thick white smoke to cover the troops’ advance.

“These explosions are fantastic looking, and produce a great deal of smoke that blinds the enemy so that our forces can move in,” said one Israeli security expert.

Burning blobs of phosphorus would cause severe injuries to anyone caught beneath them and force would-be snipers or operators of remote-controlled booby traps to take cover. Israel admitted using white phosphorus during its 2006 war with Lebanon.

The use of the weapon in the Gaza Strip, one of the world’s mostly densely population areas, is likely to ignite yet more controversy over Israel’s offensive, in which more than 2,300 Palestinians have been wounded, the paper reported.

The Geneva Treaty of 1980 stipulates that white phosphorus should not be used as a weapon of war in civilian areas, but there is no blanket ban under international law on its use as a smokescreen or for illumination.

The Israeli military last night denied using phosphorus, but refused to say what had been deployed.

“Israel uses munitions that are allowed for under international law,” said Captain Ishai David, spokesman for the Israel Defence Forces.

“We are pressing ahead with the second stage of operations, entering troops in the Gaza Strip to seize areas from which rockets are being launched into Israel,” The Times quoted him, as saying.

The civilian toll in the first 24 hours of the ground offensive — launched after a week of bombardment from air, land and sea— was at least 64 dead.

The Israeli army also suffered its first fatality of the offensive when one of its soldiers was killed by mortar fire. Mortars, mines and sniper fire wounded more than 30 soldiers. (ANI)