Channel 4’s bosses accepted hundreds of thousands of pounds in bonus payments last year, despite the broadcaster suffering its steepest fall in revenues in its 41-year history.

The state-owned, commercially funded broadcaster reported a 10% year-on-year fall in total revenues to £1.02bn last year, down £120m compared with 2022, the steepest percentage fall in income in decades.

While bosses enjoyed bonus awards, the Guardian revealed in January that as a result of the poor performance in 2023 Channel 4 was moving to cut staff numbers by 240, the biggest round of layoffs in at least 15 years.

Channel 4’s latest annual report, published on Tuesday, showed that the corporation’s top executives – the chief executive, Alex Mahon, the chief operating officer, Jonathan Allan, and the chief content officer, Ian Katz – took home £2.15m in pay and bonuses last year.

This included Mahon and Allan accepting £375,000 in bonuses, despite the poor performance of Channel 4, while Katz declined to accept an award of more than £100,000.

Katz is responsible for the corporation’s content commissioning budget, which was cut by £50m last year to £663m as part of a cost-cutting strategy. This severely financially hit hundreds of small independent TV producers who work with Channel 4.

On Tuesday, Mahon said the financial impact on TV producers was actually worse as Channel 4 had initially planned to spend more than the £713m it had in 2022, when the market was experiencing a significant post-Covid boom.

Asked why two of the top Channel 4 executives accepted performance bonuses despite the tough year for the broadcaster and its staff, Mahon said: “Executive compensation [last year] was the lowest level since 2011, down 35% year on year,” she said. “Ian [Katz] declined to take an executive bonus because he feels close to the indie community. For him it was an important decision.

“We [Mahon and Allan] took significantly reduced bonuses in line with [Channel 4’s] key performance indicators and how the remuneration committee decided to award it.”

In 2022, a record year for Channel 4, Mahon took home almost £1.5m – the most in the broadcaster’s 41-year history, including a bonus of £594,000. Last year, Mahon received a salary of £619,000 and a bonus of £247,000, and her total package was £993,000, including benefits.

Separately, last year Channel 4’s top executives agreed to “indefinitely defer” a planned retention bonus – worth hundreds of thousands of pounds – after a backlash from struggling TV producers hit by the broadcaster’s cuts to programme-making.

The loyalty payment was meant to be in recognition of their commitment during the government’s aborted plans to privatise the broadcaster.

On Tuesday, it emerged that Channel 4’s remuneration committee had agreed to pay this retention bonus to the top executives in July, after a stabilisation in the ad market.

Those payments, totalling £391,000 for Mahon, Allan and Katz, were accounted for in Channel 4’s 2022 annual report and are separate to bonus linked to performance.

The broadcaster’s advertising revenue, on which it still relies for 80% of total income, fell by 9.6% from £1.25bn to £1.14bn in 2023, the worst proportionate slump since the advertising recession of 2009.

Total staff numbers grew from 1,197 in 2022 to 1,351 in 2023, driving an increase in total staff costs from £108m to £123m year on year.

Overall, Channel 4 reported a deficit of £52m for 2023, after three years of financial surpluses totalling £178m.

“We had three years of surpluses,” Mahon said. “The idea of our model is that we can then use that for ‘down’ years to keep investing. It is now important for us to use those surpluses to diversify the business.”

Asked if Channel 4 would consider turning to the government for support, Mahon said: “We’re not looking for government to do anything, thanks very much. We are always open to ideas.”

Digital revenues increased by 10% to £280m last year, accounting for just over a quarter of total revenues, and are forecast to reach 30% in 2024 – a year ahead of its targets.

However, traditional linear TV advertising fell by 16%, or £124m, from £766m to £642m between 2022 and 2023.

Separately, Channel 4 has signed up Boris Johnson and Stormy Daniels, the adult film star at the centre of a “hush money” trial over her affair with Donald Trump, as part of plans to offer all-night coverage of the US presidential election for the first time in 32 years.

Coverage will be fronted by the Channel 4 News anchor Krishnan Guru-Murthy and Emily Maitlis, the former BBC news presenter who now co-hosts the News Agents podcast, while a deal with CNN will feature the sharing of guests, reporters, analysts, graphics and data.