Tom Glocer, the chief executive of Reuters, took a 15 per cent pay cut last year despite the media group posting its first revenue growth for four years.

According to Reuters' annual report, published today, Mr Glocer's overall pay including bonuses fell to £1.97 million in 2005, from £2.32 million in 2004.

The fall in Mr Glocers' earnings came as Reuter's remuneration committee company handed the company's executives only 72 per cent of their potential bonuses, compared with 99.4 per cent in 2004.

Earlier this year, investors had voiced concerns over "bonus creep" at Reuters amid fears over whether the performance criteria attached to the payments were tough enough.

The cut means Mr Glocer picked up a bonus of £881,000 last year, compared with £1.22 million in 2004. The drop was prompted in part through a decline in Reuters' free cash flow as it moved to a new property in Canary Wharf in London and covered other investments.

However, Mr Glocer's bonus was still the second-largest in his five years at the company. The American also received £228,309 worth of non-cash benefits to cover his London accommodation costs and company car and healthcare benefits totalling £28,745.

The chief executive also had £207,000 added to his pension in 2005, and received 417,228 shares under a long-term incentive scheme as well as options on a further 1.5 million shares.

Mr Glocer's basic pay has remained at £816,000 since he took up the position. During his tenure Reuters has struggled to match rivals such as Bloomberg and Thomson Financial in an increasingly competitive environment.

Consolidation in the banking industry has also reduced demand for its financial products among banks.

David Grigson, Reuters' finance director, saw his pay fall to £839,000, from £872,000. Devin Wenig, the company's head of business development, had his pay cut to £639,000 from package decrease from £686,000.

Last month, Reuters reported a 25 per cent increase in 2005 profits, but still saw its shares fall sharply as the market branded its outlook for the coming year disappointing.

The company said it expects underlying revenue growth for 2006 to be just 3 per cent, rather than the previously forecast 4 per cent.

The London-based company said the sale of its majority stake in the electronic trading platform Instinet and revenue growth from core subscribers - the first full year it has recorded such growth since 2001 - underpinned the profit increase.

Net profits rose to £456 million from £364 million in 2004. Revenues increased by 2.9 per cent to £2.41 billion from £2.34 billion. Underlying recurring revenue - subscriptions to financial information terminals, which accounts for 93 per cent of Reuters’ sales - was up 1 per cent for the year, including a 1.7 per cent gain in the second half.

Mr Glocer introduced the Fast Forward cost-cutting programme in 2003 and last year started the Core Plus plan, which aims to boost revenues by targeting markets outside the company's traditional terminals business.

Today, the shares were up 0.75p at 386.75p in afternoon trade in London. To track the stock click here.

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