Total auction sales were $942.9m, a nine per cent decrease on last year. Revenues for the period were $129.4m compared to $157.4m for the same period in 2000.
A variety of factors have been blamed for the downturn, including “employee retention costs” of about $8.7m for the first half of 2001, an expense exacerbated by key staff being poached by rivals. Up to $1.2m was spent on the ongoing anti-trust case, and the company suffered from the general increase in competition in the market and selectivity at sales, said chief executive William Ruprecht.
Sothebys.com recorded sales of $23.8m compared to $31m for the same quarter last year, but there was a positive note as running costs for the online business were down to $6.4m compared to the $13.9m spent for the quarter last year. And the company was keen to point out that the quarter sales for 2000 were significantly boosted by the $8.14m paid for a copy of the Declaration of Independence, the most expensive item ever auctioned online.
Sotheby’s will be looking to cut back online expenses further and hinted at job cuts in a closing statement that talked of controlling costs and improving profitability “through economies and further restructuring”.
SOTHEBY’S RESULTS
Second quarter (April 1-June 30)
Total revenues $129.4m ($157.4m*)
Net income $14.3m ($30m)
Net income excluding extraordinary
costs** $17.7m ($31.3m)
First half (January 1-June 30)
Total revenues $186.9m (212.1m)
Net income -$8.3m ($0.9m)
Net income excluding extraordinary costs** -$1.9m ($3.4m)
* Figures in brackets are results for the same period last year
** Extraordinary costs relate to employee retention and
anti-trust expenditure
Results point to more job cuts
AS Sotheby’s announced their plans for Billingshurst, they also revealed disappointing worldwide results for the second quarter of the year that showed profits halved ($14.3m compared to $30m for 2000). They predicted a loss for the year as a whole.
