FIFA: Revenue surplus of 115 million Swiss Franks
FIFA closed its four-year cycle from 1999 to 2002 with a revenue surplus of 115 million Swiss Franks (CHF), achieving an improvement of CHF 249 million compared to the total deficit of CHF 134 million originally estimated in May 2002.
Equity at the end of 2002 amounted to CHF 151 million. The balance sheet records a further amount of CHF 222 million in special reserves. Moreover, FIFA forecasts a surplus of CHF 170 million for the new World Cup cycle from 2003 to 2006.
After the sporting success of the World Cup in Korea and Japan in 2002, FIFA can look back on a highly satisfactory result for the World Cup financial cycle. As FIFA President Joseph S. Blatter announced in Zürich today at the first financial media conference in the history of the world football's governing body, FIFA registered a surplus of CHF 115 million for the 1999-2002 period after revenue amounting to CHF 2.685 billion and expenditure totalling CHF 2.570 billion.
FIFA President Blatter expressed his pleasure at the figures approved by the auditing company, KPMG: "FIFA has proved that it can weather the stormiest circumstances. It took immediate precautions entirely on its own initiative to counteract the consequences of the bankruptcy of its marketing and television partners without jeopardising the quality of its flagship competition, the 2002 FIFA World Cup™, in the slightest. Now, FIFA is financially more stable than ever."
The main reasons for the CHF 249 million improvement in the result can be attributed to dynamic crisis management in dealing with the bankruptcy of both partners, ISL/ISMM and Kirch, to setting up and running FIFA Marketing, as well as to the cost reduction programme, SCORE. FIFA shows sound financial foundations in the closing accounts with equity of CHF 151 million. Furthermore, FIFA can lay claim to CHF 222 million in reserves that are not largely intended for operational costs.
For the new 2003 - 2006 World Cup cycle, FIFA is expecting a surplus of CHF 170 million with revenue of CHF 2.042 billion and expenditure of CHF 1.872 billion. The diminished revenue is attributable to the fact that FIFA cashed in future revenue of CHF 336 million in 2001. These resources are, for the most part, still available.
FIFA is also expecting lower overall costs than those for the 1999 - 2002 period, given that the one-off expenditure for co-hosting the FIFA World Cup in two countries will no longer apply and the cost of developing the IT solution will be less.