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Falling profits lead IBM executives to forgo bonuses

A drop in sales and declining profits has led the chief executive and senior management of IBM to forgo their annual bonuses for 2013.

Ginni Rometty, chief executive of IBM, said in a statement that she had made the decision with the other top executives despite claiming the company had made "solid progress" last year.

"We continued to drive strong results across much of our portfolio and again grew earnings per share in 2013," Rometty said.

"(However), in view of the company's overall full year results, my senior team and I have recommended that we forgo our personal annual incentive payments for 2013."

The world's largest computer-services provider revealed in its fourth-quarter and full-year results report that it had suffered a 5 per cent decline in sales in 2013, which has contributed to a 1 per cent drop in net profit compared to the previous year.

Looking ahead to 2014, the firm predicted to see its operating profit rise more than 10 per cent as a result of new areas of investment.

"As we enter 2014, we will continue to transform our business and invest aggressively in the areas that will drive growth and higher value," Rometty added.

"We remain on track toward our 2015 roadmap for operating EPS of at least $20, a step in our long-term strategy of industry leadership and continuous transformation."

One such area of growth could come from IBM's recent $1 billion (£607 million) investment in its new supercomputer unit powered by the gameshow-winning supercomputer Watson.

The firm has also recently announced its commitment to increasing its data centre count and expanding its cloud offerings.