June 10, 2010 / 4:22 PM / 10 years ago

FIFA reveals billion dollar equity, big profits

JOHANNESBURG (Reuters) - FIFA made a profit of $196 million in 2009 and has equity of over $1 billion thanks mainly to massive and still growing income from the sale of TV rights, soccer’s governing body said on Thursday.

U.S. dollar notes are piled up after counting at a bank in Seoul October 22, 2008. REUTERS/Lee Jae-Won

Television and marketing rights sales brought in the vast majority of revenue of $1,022 million in 2009, FIFA’s financial report showed.

Presenting the report to Congress on the eve of the opening match of the World Cup in South Africa, FIFA said it now had a “solid” equity basis of $1,061 million.

“While equity of over a billion dollars seems high, it is necessary as the financial risks exceed it many times over,” Franco Carraro, chairman of the internal audit committee, told delegates. “The figure is only enough to cover the next year and a half.”

FIFA said successful risk management in recent years had helped it avoid the worst effects of the global financial crisis.

The governing body said revenue for the period 2007-10 was 12 times greater than for the period 1995-98, up from $257 million to $3,200 million.

At the same time, it said, spending on development programmes around the world was 50 times greater, from $14 million for 1995-98 to $691 million for 2007-10.

For 2009, FIFA invested $172 million in development, it said.

Healthy finances meant FIFA President Sepp Blatter, who formally announced he would seek re-election next year, was able to confirm to delegates that each national association would get a one-off bonus payment of $250,000 next year.

The six Confederations will each receive extraordinary contributions of $2.5 million.

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