Senior executives in the pub, brewing and restaurant industry continue to enjoy substantial salary increases, despite falling profit levels, says compensation specialists, Halliwell Consulting.

In a report, Halliwell says that the annual salaries of chief executives and directors of FTSE leisure, entertainment and hotels companies, have increased by an average of 11 per cent over the past year.

In the pub, brewing and restaurant sector, salaries increased by 10 per cent despite a 105 per cent drop in profits, while executives in the hotel sector enjoyed an 8 per cent increase in salaries as profits dropped 44 per cent.

However the past 12 months has also seen a drop in bonuses across the sector. Executive's current share incentives range from -£3,626,000 at worst to £1,231,000 at best, which means that if the average CEO were to exercise their share options in this sector now, they would suffer a loss of £135,844.

While shareholders may think the loss is a case of just deserts, it may result in companies losing key executives, says Halliwell's chief executive, Marcus Peaker: 'A large element of the lock in of executives in companies is the share awards they hold. When these are valueless it makes poaching by a competitor much easier as there is no requirement to buy out the existing share package.'

'It is in no one's interest, particularly shareholders, for companies to lose key executive at a generally difficult time in the market.' Details: www.halliwellconsulting.co.uk