A few tasty tidbits from the 10-Q financial report filed yesterday by publicly traded Sotheby’s:
As of Aug. 7, Sotheby’s had outstanding guarantees totaling $274.9 million. (Guarantees are the amounts promised by the auction house to consignors, whether or not the bidding actually achieves those amounts.) During a conference call Wednesday with securities analysts, William Ruprecht, Sotheby’s CEO, noted that this year’s figure is significantly higher than the amount of outstanding guarantees at the same time last year. (The figure in last summer’s 10-Q was only $41.6 million.) These guarantees are essentially a bet, risking the company’s money, that prices will stay firm this fall.
But the lastest 10-Q also revealed that Sotheby’s return from guarantees declined $9.2 million in the first half of 2007, compared to the first half of 2006. This was because “prior period results were favorably impacted by the Company sharing in a significant portion of the hammer price on a guaranteed property sold at auction in the prior year.” (Note that it says “A guaranteed property.” Auction-ologists: Which work might that be?) Under the terms of guarantees, the auction house takes a large chunk of the portion of the final price that exceeds the amount of the guarantee.
Also of interest to those of you who read my Wall Street Journal article about the new redeemability of auction house antitrust settlement coupons for cash: The value of such coupons still outstanding at the two auction houses has decreased from about $92 million in May, to $56.8 million (twice the $28.4 million reported in the 10-Q by Sotheby’s alone), as of June 30. This means that some of you have been following my helpful advice to rummage around your drawers for those pesky pieces of paper. You’ve got until May 14 of next year to cash in the rest. After that, they’re trash.
Meanwhile, Sotheby’s stock is falling today, along with the rest of the stock market. As of 12:36 p.m., it was trading at 43.77, down 3.61 (7.6%) from yesterday’s close. With the current U.S. credit crisis now reverberating globally, what’s going to happen at the major auctions this fall is anyone’s guess.
And, finally, this just in from Christie’s press office:
Our July 13th press release reported that Christie’s International sold 358 lots for over $1 million. This figure was without [buyers] premium. This week, a [ahem] competitor reported selling 391 lots for over $1 million in the first half of the year. With premium, Christie’s International sold 430 lots over $1 million in the first half of the year. We would like you to have this information for accurate comparison.
Don’t you just love it when the auction houses get angry?
CultureGrrl
Lee Rosenbaum's cultural commentary
an ArtsJournal blog