Sotheby's 1H Revenue +21%, Profit +3%

Sotheby's auction sales rose 24 percent year on year to $2.7 billion during the first half of the year that ended on June 30. The company's revenue increased 21.2 percent to $492.6 million, while expenses rose 21.6 percent to $358.1 million. Profit for the first half increased 3 percent to $71.5 million, resulting in diluted earnings per share of $1.01, Rapaport reports.
The company stated that continued strength in the global art market and by excellent spring sales worldwide for all categories drove Sotheby's adjusted operating income up 42 percent.
"Sotheby's is seeing success across categories and around the world," said the company's chairman, Bill Ruprecht. "The number of buyers at all levels, the amount of property we were entrusted to sell, and the prices we achieved are all up significantly this year. We sold 487 lots at over $1 million, more than any other art market participant. We are demonstrating that the art market is robust and we're serving new and existing clients who trust Sotheby's to deliver superior expertise and market knowledge and attractive results.
"The fact that 26 percent of our buyers in the first half of the year were first-time clients shows we are engaging with a new generation of collectors and that's exciting. We're looking forward to building on the successes of these six months with a number of exceptional sales this fall and with our new eBay partnership that will showcase our New York auctions to an unrivaled global online audience of millions of potentially new collectors," he added.
In July, Sotheby's announced a restructuring plan that will reallocate resources to collecting categories and regions with the highest potential for growth and to further reduce costs, according to  Patrick McClymont, the company's chief financial officer. Adjusted net income increased 22 percent to $84.9 million for the first half, however, Sotheby's effective tax rate jumped from 23 percent one year ago to 39 percent, primarily due to the accrual of U.S. taxes on the earnings of foreign subsidiaries in 2014 and the impact of a non-recurring $6.8 million tax benefit recorded in the second quarter of 2013 related to a loss on the tax basis in a foreign subsidiary.