- The Washington Times - Friday, March 20, 2009

ZURICH, SWITZERLAND (AP) - FIFA president Sepp Blatter says soccer will eventually be hit by the global financial crisis, despite a profit of $184 million in 2008.

The soccer world governing body announced an income of $957 million last year, according to the annual report presented Friday. A total of 95 percent was generated by television, marketing and sponsorship money raised from the World Cup.

“We are in a rather comfortable situation,” Blatter said at a news conference. “But let us not forget that the economic crisis which is rampant can be compared to a tsunami in its first wave. (soccer) will also be affected.”

FIFA even made a profit of $16 million in managing its assets last year. Its equity stands at $902 million, boosted by a successful policy of hedging foreign currency.

Financial director Markus Kuttner sounded a cautious note, saying FIFA was only halfway through a four-year financial cycle leading up to the 2010 World Cup in South Africa. The tournament is expected to generate $3.2 billion for FIFA.

“We should not forget that 95 percent of revenue is from the World Cup,” Kuttner said. “Almost all our eggs are in the same basket. We have a high exposure here.”

Kuttner said the financial cycle could only be declared a success once the World Cup was completed in July 2010 and all commercial partners had fulfilled their contractual obligations.

At least 28 of the 64 matches played at the monthlong tournament have already sold out.

“We have sold close to 800,000 tickets in a month,” FIFA secretary-general Jerome Valcke said. “Two-thirds to the international market, one-third to the domestic market.

“The two countries buying the most are the USA and England,” he added. “Definitely, the demand is huge.”

However, slow ticket sales for the Confederations Cup _ an eight-nation test event being played in South Africa in June _ have been a concern, Valcke said.

Valcke said none of FIFA’s sponsors had asked to reassess contracts or payment schedules, including troubled Indian software giant Satyam.

The company is to provide FIFA’s computer services at the next two World Cups and Confederations Cups. The value of the contract was not disclosed.

The company has been struggling to survive since Jan. 7, when Raju confessed to filling the company’s balance sheets with $1 billion in “fictitious” assets and “nonexistent” cash.

“We have no fear about what will happen in the future with Satyam,” Valcke said. “It is not a huge financial contractor, but they do have to deliver a lot of services. We have been in touch with the new CEO quite often.”

Blatter and Valcke will fly to South Africa next week to attend the opening of the new stadium in Rustenberg, one of the World Cup and Confederations Cup venues.

Valcke said nine of the World Cup stadiums would be ready by December, with the 10th and final stadium in Cape Town scheduled for completion in February.

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