Sotheby's Sees Small 1st Quarter Loss

Philip Boroff writing for Bloomberg reports that Sotheby's first quarter 2010 results are greatly improved from a year ago, although the auction house still had a net loss. Boroff reports that sales were up while costs were reduced. The trend is positive and although Sotheby's bettered expectations for its loss, the expectations were that revenue would be higher than what was recorded. Overall, the first quarter loss was $2.1 million, compared to a loss of $34.5 million in the first quarter of 2009. Revenue increased 87% from last year to $101.9 million. Boroff notes that the 1st and 3rd quarters typically show a small loss, while the 2nd and 4th quarters draw the most revenue.

Boroff reports

Sotheby’s, the world’s top publicly traded auction company, said its first-quarter loss narrowed after sales rose and it cut costs.

The New York company lost $2.1 million, or 3 cents a share, compared with $34.5 million, or 53 cents, a year earlier. Revenue increased 87 percent to $101.9 million.

The results exceeded forecasts for earnings and fell short on revenue. Analysts surveyed by Bloomberg forecast an average loss of 19 cents a share. They had estimated revenue of $105 million.

“The renewed art-market momentum that began last autumn continued into the first quarter,” Chief Executive William Ruprecht said today in an e-mailed statement.

Sotheby’s cited the “absence of certain expenses in 2010 that were incurred in 2009,” without being specific. It also cut staff by 19 percent, or 315 employees, to 1,323 at the end of 2009, as the art market declined, according to a prior filing.

Its shares have more than quadrupled since March 2009 amid signs that the auction market is rebounding. Sotheby’s shares fell 55 cents to $34.42 as of 10:41 a.m. in New York Stock Exchange trading.

To  read the full Bloomberg article, click HERE.