Nine Entertainment has rewarded ratings over revenue, with chief executive Hugh Marks awarded 70 per cent of his cash bonuses despite the broadcaster making a $203 million annual loss.
Mr Marks took home $2.77 million in the year to June 30, including a salary of $1.38 million, cash bonuses of $895,000, and shares worth almost $450,000.
He was paid $1.14 million in the previous financial year, in which he was CEO for eight months.
Nine’s revenue dropped three per cent in 2016/17, and writedowns on assets including its TV network contributed to its loss for the year, while earnings rose two per cent.
Media analyst and Fusion Strategy managing director Steve Allen said Nine’s executive team had their bonuses aligned with the company’s market share, ratings and share price performance.
Nine shares rose 31 per cent in the 2016/17 financial year.
“In a shrinking media market, ratings and revenue share would feature strongly – and in those (Mr Marks) is delivering,” Mr Allen said.
Bonuses for Mr Marks were also related to his performance in improving supplementary revenue streams and content production.
Nine’s leadership in the key 25-54 age demographic has been enhanced by the success of productions like True Story with Hamish and Andy, and helped build its 9Now catch up service, which boasts 4.3 million registered users.
Subscribers for Nine’s on demand joint-venture, Stan, have also grown by 50 per cent.
Despite Nine’s market leading position, Mr Allen suggested its robust remuneration packages would eventually attract investor scrutiny.
“Nine’s board and executives seem to be doing a good deal better than shareholders and sooner or later they will be held to account,” Mr Allen said.