Sotheby's has reported third-quarter auction and related revenues of $52.9 million, a $2.2 million decrease from their second-quarter results. Third-quarter results are typically the lowest of the year due to the auction calendar. The auction house recorded a third-quarter net loss of $29.7 million, partially due to lower auction revenues, higher administrative costs and restructuring charges of $2.2 million, as well as a $5.7-million inventory writedown-the lowering of an asset's book value to reflect the market value-related to Noortman Master Paintings, the old master gallery it acquired in 2006 for $82.5 million.
So far this year, Sotheby's has earned $99.9 million, reflecting a 55-percent increase over the same period last year. Sotheby's fourth quarter results already look promising. Its Impressionist and modern sales last week in New York brought $229.7 million, within the presale estimate of $202–289 million. And last month in Hong Kong, its total sales—contemporary Asian art to jewels, watches and Ming porcelain—brought $410.8 million, the second highest total ever for Sotheby's Hong Kong.
In the company's third-quarter earnings conference call on Nov. 7, president and CEO Bill Ruprecht commented on the importance of Asia to its business. He noted that the increase of Asian sales worldwide has led to an increase in Asian participation in its overall business. Though "the highest levels of participation in [Sotheby's] global portfolio by Asians has been in Asian sales," he described Europe, the U.S. and Asia as a three-legged stool, each "contributing roughly equally to our success."
Remarking on the additional outlay of resources to digital media and the website, on which the auctions are streamed live, Ruprecht said, "The biggest innovation in our autumn cycle has been the delivery of catalogues to tablet devices . . . that offer much more than our printed catalogues ever have." Such distribution, he noted, also allows for greater penetration into parts of the world than print, and more immediacy for clients who travel extensively. "Tablet devices are going to be a critical element of how people consume information and content from Sotheby's."