STV chiefs accept 40% pay cut as profits dive

STV chief executive Rob Woodward and chief financial officer George Watt both took a 40 per cent pay cut last year as the Scottish broadcaster saw its profits more than halved, the group's annual report shows.

• Picture: Complimentary

Woodward's total pay, including basic salary and benefits, fell to 418,000 from 699,000 in 2009 as a challenging advertising market saw pre-tax profits slump from 13 million to 6m. He did not receive a performance-related bonus for the year.

Watt also took a hit to his total pay package of 152,000, reducing it to 225,000.

The pair are the only two executive directors on STV's board. Pay for the broadcaster's non-executive directors fell by 64,000 to 788,000 in 2009.

The pay cuts came amid a tough year for STV, which saw profits slide despite cost-cutting efforts. Adjusting for the sale of Virgin Radio, revenue also dropped 17 per cent to 110m in 2009.

An STV spokeswoman said: "Our remuneration policy during 2009 was structured to reflect the macro-economic conditions and downturn in advertising revenue. In the view of our board and exec team, these voluntary reductions demonstrated our commitment to deliver to our shareholders and were appropriate given the economic uncertainty we experienced in 2009.

"As reported in our annual results, announced 25 February 2010, our 2009 performance was in line with expectations and trading in Q1 is continuing to improve, however our longterm outlook remains cautious."

The changes to remuneration at STV contrast with the revelation yesterday that ITV has agreed to pay its incoming chief executive, Adam Crozier, a 200,000 "golden hello" when he takes the helm next month .

The windfall is on top of a 775,000 basic salary and a one-off deferred share incentive worth more than 2 million at yesterday's share price, plus a further 420,000 in shares that will vest over the next 18 months.

Crozier, who will join ITV from the Royal Mail, will also be entitled to the company's normal annual bonus and long-term share scheme pay-outs.

However, Crozier's basic pay will be marginally less than his predecessor Sir Michael Grade. ITV's annual report shows the broadcaster paid Grade a 1.2m cash bonus for 2009.

Earlier this month ITV posted a pre-tax profit of 25m for 2009 compared to a 2.7 billion loss in 2008. The improvement in trading was in part down to an aggressive cost-cutting strategy, which saw 169m stripped out of the business last year.

The station behind The X Factor and I'm a Celebrity … indicated that the worst of the advertising slump may now be behind it, with an encouraging performance so far in 2010. It said advertising revenue in the first three months of 2010 was 7 per cent up on the same period in 2009.