Sotheby's profits down - 'rather bumpy'
August 17 2015
Picture: Sotheby's
Sotheby's share price has dropped a little - to $37 - on news that its profits were down by 16% to $125m, on auction sales of $1.86bn. New CEO Tad Smith described the results as 'rather bumpy'. In their defence Sotheby's pointed to a calendar change, and in particular the fact that one or two guaranteed lots in recent contemporary sales didn't quite work out as expected. This maybe so - but it only goes to highlight how risky such high value guarantees are to the auction houses. A wrong punt on a 'record breaking' contemporary work can prove extremely costly to the year's overall figures. It was such speculation that nearly sank the auction houses back in the last crash (when Sotheby's share price was about $6 at one point). And you'd think they might have learnt by now. But if anything, Christie's massive foray into guarantees in a bold bid to seize the initiative in the contemporary market will only increase pressure on Sotheby's to follow suit. 'Rather bumpy' indeed.
Still, it was heartening for all purveyors of things artistic to see that what Sotheby's classed as 'Asian buying' was up 35% overall, with 'greater Asian bidding in more than 20 sales categories including Old Master Paintings, British Pictures and 20th Century design'.
For a full analysis of the figures, see Alex Capon's report in The Antiques Trade Gazette.
