Sotheby’s 2nd-Quarter Profit Falls on Lower Auction Sales
Sotheby’s (BID) said second-quarter earnings declined 33 percent as auction sales fell.
Net income at the publicly traded art auctioneer was $85.4 million, or $1.24 a share, down from $127.2 million, or $1.81 a share, a year earlier, the company said in a statement. Second- quarter revenue fell 18 percent to $303.9 million.
The results fell from what Sotheby’s had called the most profitable quarter in its history.
“Our results reflect the global economy, which we’re all experiencing,” Chief Executive Officer William Ruprecht said in a conference call with analysts and investors. “Income is down because sales are down. The overall health of the business is intact.”
Six analysts polled by Bloomberg forecast profit of $1.52 a share.
The results included the May sale of a version of Edvard Munch’s “The Scream” for $119.9 million, the highest price ever paid for an artwork at auction. Leon Black was the buyer, the Wall Street Journal reported. Spokesmen for the auctioneer and Black declined to comment.
Sotheby’s disclosed in a filing with the Securities and Exchange Commission that as part of an agreement with the union representing 42 art handlers, it offered severance to those who quit. As of July 20, 35 of the 42 handlers had accepted buyouts, resulting in a charge of $4.4 million. Before the agreement, the workers had been locked out of work for 10 months.
Sotheby’s said in a release that “future labor costs have been reset in an attractive and sustainable way.”
Sotheby’s shares rose 8 percent this year. Today, they advanced 64 cents to $30.77 in New York Stock Exchange trading. The Standard & Poor’s 500 Index is up 12 percent in 2012.
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