Sotheby’s profits drop by 58% over nine-month period
Chief executive Ruprecht points to typical seasonal factors
By Melanie Gerlis. Web only
Published online: 22 November 2012
Sotheby’s posted a pre-tax loss of $46.4m (a net loss of $32.6m), representing a $57.7m, or 58%, fall in net profits for the first nine months of the year. The company says that the third quarter is nearly always a loss-making period, historically representing between 7% and 10% of its annual sales.
Revenues were up 18% to $68.5m for the quarter, driven by a 50% improvement in private sales commissions. This growth reflects Sotheby’s efforts to become more than just a “monosyllabic advocate of one [sales] channel”, according to Bill Ruprecht, Sotheby’s chief executive, speaking during the shareholder conference call last month. He says the outlook for the art market remains “robust”, particularly at the high end.
He acknowledged that growth in China was slowing, but said this country’s prospects still made the rest of the world “look very pedestrian”. Sotheby’s announced a joint venture with Beijing’s state-owned GeHua Art Company in September, meaning it will be able to hold auctions in the mainland. “Being closer to that country’s wealth is smart,” said Ruprecht. “We don’t know how fast the growth will be… it is a ‘learn-as-you-go’ [move] rather than a transformation overnight.”
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