Watch Auctions

Save E-mail Print Most Popular RSS Reprints

Revenues slide 58 percent at Sotheby's

Auction house plans 20 percent workforce reduction

May 08, 2009

Similar Stories | Topics

New York--Revenues fell 58 percent in the first quarter for international auction house Sotheby's.

According to an earnings statement released by the company on Thursday, for the first quarter ended March 31, revenues totaled $54.4 million, a $74.8 million decrease from the first quarter of 2008.

"This decrease," the release states, "is primarily due to a 71 percent decline in net auction sales attributable to the downturn in the global economy and its impact on the international art market that began in September 2008."

Partially offsetting the decline is a 41 percent increase in auction commission margin due to the company's revenue enhancement strategies, an increase in the buyer's premium implemented in June and a change in sales mix.

Net loss in the first quarter was $34.5 million, attributable to the net auction sales decline but somewhat offset by a 25 percent reduction in operating expenses, according to the release.

"Sotheby's first-quarter results demonstrate an aggressive response to the ongoing global uncertainty, with costs down 25 percent and margins up 41 percent," Sotheby's President and Chief Executive Officer Bill Ruprecht stated in the release. "The dynamics of the business are shifting dramatically, positioning us for strong future earnings power when the market rebounds, with more limited downside."

In late 2008, Sotheby's announced a restructuring plan, and in response to the continuing downturn in the global economy and international market, the company approved another restructuring plan in late April. The plans include a 20 percent reduction in Sotheby's workforce globally, saving the company $24 million.

In addition, according to the release, Sotheby's management is implementing other cost-saving initiatives that are expected to save the company $160 million in 2009.

Sotheby's next jewelry auction, "Magnificent Jewels," is scheduled for next week in Geneva and is expected to total between $27 million-$40 million.

The sale includes an internally flawless 7.03-carat cushion-shaped fancy-vivid-blue diamond. The stone, which was cut from a 26.58-carat piece of rough unearthed at Petra Diamonds' Cullinan mine in South Africa, is estimated to fetch $6 million-$9 million.
Save E-mail Print Most Popular RSS Reprints
Post a Comment
* Required field
* Author:
* Comment:
 

More Watch Auctions

Piguet and Capt musical spyglass
Patrizzi nets more than $6.2M at October sale

Geneva--Sales from Patrizzi and Co.'s October horological auction in Geneva totaled more than $6.2 million, with 70 percent of the 253 lots selling. Read More

Ulysse Nardin wristwatch leads Bonhams auction
More Watch Auctions

More Like This

Flawless blue diamond up for grabs at Sotheby's
April 03, 2009 | National Jeweler Network
Big diamonds don't sell at Sotheby's
November 20, 2008 | National Jeweler Network
Sotheby's to offer jewels of Brazil's 'first lady'
April 24, 2008 | National Jeweler Network
Sotheby's experiences record-setting year
February 27, 2008 | National Jeweler Network
Sotheby's holds record-setting sale
December 05, 2007 | National Jeweler Network
TOPICS
Auctions | Business | Company Activities and Information | Corporate Reporting | Earnings and Loss Announcements | Earnings and Losses | Visual Arts

Design Portfolio

advertisement

Video

Small multi video player located on right rail of NJN site

advertisement

Sponsored by:

Retailer Toolbar

America's Best Jewelers
Join the ONLY Social Network for Jewelry Retailers. Get access to expert content, peer best practices, and more.
Start networking today.
Newsletters
Newsletters
Topic-specific newsletters that deliver the latest news on jewelry, diamonds, wholesale operations and high-volume buying directly to your in-box.
Reader Connect
ReaderConnect
Supplier information presented with every article, bringing you related, actionable content on every topic.
Jewelry Yellow Pages
Yellow Pages
A comprehensive listing of associations, organizations, suppliers and services for the jewelry industry.
Classifieds
Classifieds
A comprehensive listing of job postings, product offerings and other materials for sale for the jewelry industry.
NJN Customer Connect
CustomerConnect
The most sophisticated suite of marketing services available for jewelry retailers, from Internet tools to data marketing.

advertisement