Sotheby's total revenues down 18pc
Sotheby's (NYSE: BID), a global company that engages in art auction, private sales and art-related financing activities, reported financial results for the second quarter and first half ended June 30, 2012.
Sotheby's reported second quarter 2012 net income of USD 85.4 million, a decrease of 33pc from the prior year period, and total revenues of USD 303.9 million, down 18pc , when compared to the prior year period.
For the six months ended June 30, 2012, the Company reported net income of USD 74.8 million, a decrease of 42pc , and total revenues of USD 408.9 million, down 16pc , when compared to the prior year period.
The lower levels of revenues and profitability in the current periods reflect a decrease in net auction sales when compared to the prior year periods and in particular, a 67pc decline in single owner sales volume in the second quarter and a 55pc decline in the first half.
The impact of the decline in total revenues is partially offset by reductions in total expenses of USD 13.6 million, or 8pc , in the second quarter and USD 8.5 million, or 3pc , in the first half.
First half 2012 results are negatively impacted by incremental expense relating to resolution of the labor dispute with New York unionized art handlers, the bulk of which is for severance benefits to be paid to certain union members in exchange for their voluntary termination of employment. However, Sotheby's management believes that future labor costs have been reset in an attractive and sustainable way.
"Our operating results reflect some tremendous successes, but also reflect the challenging global economy, a tough comparison to the best quarter in Sotheby's history a year ago, and a competitive climate for high-end consignments," said Bill Ruprecht, President and Chief Executive Officer.
"Demand and prices remain strong, especially at the high end of the market, as reflected in our highest ever sale of Impressionist and Modern Art of USD 373.3 million in May in New York.
"We're pleased to report that our Financial Services business grew substantially in the first half of 2012 and private sales are an increasingly important contributor to our revenue stream. We have seen a slowdown in the Asian market alongside the economy there, but it continues to be very profitable and a source of substantial opportunity for Sotheby's.
"Art appears to remain an attractive asset for collectors and our consignment pipeline for the Autumn season is very active at the moment. We remain confident in the global art market and will, as always, seek opportunities to broaden and extend the breadth and depth of our relationships with our clients," he added.
Second and Third Quarter Sales
Sotheby's made auction history when Edvard Munch's iconic masterpiece, The Scream, sold for USD 119.9 million at the Impressionist and Modern Art Evening Sale in New York in May - a new world record for any work of art at auction.
The Evening Sale totaled USD 330.6 million, Sotheby's highest ever total for a sale of Impressionist and Modern Art Worldwide and the second highest total for a Sotheby's auction in any category.
In London in late May, Sotheby's offered the collection of the late photographer Gunter Sachs in a tremendously successful two-day sale that realized a total of USD 65.5 million, double the pre-sale low estimate with bidding from 17 countries across four continents.
Among the sale's most notable works was one of Andy Warhol's last self-portraits, Self Portrait (Fright Wig), which sold for USD 8.5 million, and his large Flowers, which sold for USD 5.9 million.
Sotheby's June London sales brought remarkable prices, including Joan Miró's Peinture (Étoile Bleue) for USD 36.9 million, a record for the artist at auction for a piece from his seminal "dream paintings" series.
Also highlighting the Impressionist and Modern Art sales was Pablo Picasso's monumental late portrait Homme assis which brought USD 9.7 million. The Impressionist and Modern Art series brought a total of USD 139.9 million. The June London Contemporary Art series brought a total of USD 129.7 million, with the top lot of Jean-Michel Basquiat's Warrior bringing USD 8.7 million, nearly double the price it achieved at auction five years ago.
In addition, Sotheby's Old Master and British Paintings sales realized a total of USD 60.3 million in London.
The highlight of the Old Master Paintings evening sale was an historic naval scene by Willem van de Velde the Younger, The Surrender of the Royal Prince during the Four Days' Battle, 1st-4th June 1666, which sold for USD 8.3 million and was purchased by a Dutch collector who intends to return the painting to its home in the Netherlands.
The Board of Directors of Sotheby's has declared a quarterly dividend of USD 0.08 for the third quarter of 2012. The third quarter dividend is payable on September 17, 2012 to shareholders of record as of September 4, 2012.
On September 11th and 12th in New York, the Company's sale of Fine Chinese Ceramics and Works of Art will be led by An Imperial Celadon Jade 'Ba Zheng Mao Nian Zhi Bao' Seal Qing Dynasty, Qianlong Period (pre-sale estimate of USD 800,000/1.2 million) and An Important Wucai Fish Jar And Cover, Jiajing Mark And Period that is being sold by The Walters Art Museum in Baltimore to benefit the Asian Art Acquisitions Fund (pre-sale estimate of USD 500/700,000). The 400 lot sale carries a total pre-sale estimate of USD 15/22 million.
On September 24th and 25th, Sotheby's New York will auction property from the estate of beloved philanthropist and legendary society figure Brooke Astor. The sale offers fine and decorative art from Mrs. Astor's New York City apartment and Westchester estate, as well as a selection of wonderful jewelry from her personal collection.
The auction will benefit a number of charities that Mrs. Astor championed, including The New York Public Library, The Metropolitan Museum of Art and The Animal Medical Center of New York. The property carries a combined pre-sale estimate of USD 6/8 million.
From October 5th to 9th, Sotheby's Hong Kong will hold its 2012 Autumn Sale Series which will be led by an exquisite hanging scroll painting, Double Lotus for the Yongzheng Emperor by Giuseppe Castiglione (Lang Shining, 1688-1766).
A celebrated official painter to the Qing Imperial court, Castiglione's works rarely ever come to market (pre-sale estimate of USD 19.2 million). We are also pleased to offer A Fine And Extremely Rare Pair Of Yellow Ground Famille-Rose Double-Gourd Vases, Seal Marks And Period Of Qianlong (pre-sale estimate of USD 5.1/7.7 million).
Following the success of the previous three parts of The Meiyintang Collection - An Important Selection of Imperial Chinese Porcelains, the fourth part of the collection will continue to bring iconic pieces of Imperial Chinese porcelain to the market.
From September 7th to October 28th, Sotheby's will present Beyond Limits, our annual selling exhibition of monumental sculpture staged on the historic grounds of Chatsworth House in Derbyshire which is now in its seventh year.
For the first time, Beyond Limits will showcase the work of a single artist, Barry Flanagan, RA OBE (1941-2009) following his recent retrospective exhibition at the Tate Britain, with a selection of the artist's critically acclaimed, monumental late works.
In November, Sotheby's London will host "Unfolding Landscape", the first Western exhibition of works by graduates of China's premier arts academy at the School of Design of the China Central Academy of Fine Arts (CAFA).
The show will include furniture, ceramics, jewelry, fashion and photography by China's next generation of creative talents, and is curated by Janice Blackburn, renowned for bringing lesser-known, emerging artists to international attention.
This winter, Sotheby's New York will celebrate one of the world's most important private collections of photographs with the sale A Show Of Hands: Photographs From The Collection of Henry Buhl.
Assembled over the course of 20 years by the philanthropist and collector Henry M. Buhl, the collection explores the theme of the human hand, with works from the art form's early 19th century pioneers to the masters of 20th century photography and beyond.
The auction includes approximately 400 lots and has a total pre-sale estimate of USD 8/12 million.