Sotheby's First Half 2010 Earnings

Sotheby's announced their first half 2010 earnings today, and the results are very positive.  They also announced that there will be a third quarter dividend of five cents per share.  As expected the financial results are strong, as Sotheby's worked to increase income, reduce overhead and lower the costs for sales.

The results and highlights are as follows from the Sotheby's press release.

• Second Quarter Revenues Increase 68% to $281.4 million

• Second Quarter Net Income Increases Six-Fold to $86.2 million

• First Half Revenues Increase 73% to $383.3 million

• First Half Net Income Increases $106.4 million to $84.1 million

August 5, 2010, New York -- Sotheby’s (NYSE: BID) today announced results for the secondvquarter and first half ended June 30, 2010. For the three and six months ended June 30, 2010, auction and related revenues improved $118.8 million, or 79%, and $168.4 million, or 86%, when compared to the same periods in the prior year, almost entirely due to an increase in auction commission revenues stemming from strong sales around the world during the period. Total aggregate auction sales were $1.6 billion in the second quarter and $2.2 billion in the first half, an increase of 110% and 116%, respectively. Most notably, combined sales of Impressionist and Contemporary Art increased $428 million, or 154%, and $684 million, or 188%, in the second quarter and first half of the year, respectively. Partially offsetting the increase in auction commission revenues is a decline in auction commission margin from 21.3% to 18.7% in the second quarter and from 20.8% to 18.3% in the first half, attributable to the change in sales mix towards higher valued items in both periods. Over $1 million, the buyer’s premium rate decreases from 20% to 12%.

Despite the significant increase in auction sales and revenues, operating expenses were well
controlled with the increase over the prior year principally due to increased accrued incentive
compensation expense as a result of the significant improvement in profitability.

To read the full Sotheby's press release on first half earnings, click HERE.