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The $104.2m premium-inclusive record price for the artist left Sotheby’s with a sales total of $1.1bn for the period, up 87 per cent on the $589m recorded for the second quarter of 2003. It also heralded a turnaround in fortunes as the 2003 total represented a 15 per cent decline on 2002.

The reversal in fortunes is not limited to sales totals. Company revenues have risen significantly, both for the first quarter (40%) and the first half (65%) of 2004. But the real story has been the turnaround in profits.

Chief executive Bill Ruprecht’s policy of raising auction commissions while cutting costs has been boosted by first half fees of $45m relating to the licensing agreement for Sotheby’s real estate brokerage. What are now relatively minor special charges relating to staff retention, restructuring and anti-trust measures no longer have the impact on the bottom line that they registered a couple of years ago.

While Mr Ruprecht was upbeat about the company’s performance – “Excluding the gain from our sale of the real estate business, operating income from continuing operations is 15 times that of last year” – he damped down expectations for the rest of the year. The second half is traditionally a quieter time for auction sales, but added to this Mr Ruprecht said the company did not expect any further landmark single-owner sales such as the Forbes Collection of Fabergé, sold in February, let alone another major Picasso.

Total sales for the first half of the year were $1.35bn compared to Christie’s $1.25bn announced at the end of last week.