Poor year for Sotheby's in 2012 as results show drop in revenues and profits

Global auction house Sotheby's posted an 8 percent fall on the year in revenues last year to $768.5 million. Meanwhile, net income slumped 37 percent on 2011 to $108.3 million.

The fall in revenues was largely caused by an 11 percent drop in auction commissions as a result of a 10 percent decrease in net auction sales, as 2011 had included a record level of sales from single owner collections, according to Sotheby's. 

The company said, however, that the fall in auction commissions was offset by a 10-percent rise in private sale commissions and a 47 percent jump in finance revenues.

"Consolidated sales in 2012 were a robust $5.4 billion as healthy bidding continued around the world for great works of art," said Sotheby's Chairman, President and Chief Executive Officer Bill Ruprecht.

"Our operating results reflect some significant successes, a stiff comparison to one of the best years in Sotheby's history a year ago, and a very competitive climate for high-end consignments. Overall, I remain confident in the marketplace."

The auctioneer posted an 11-percent rise in private sales to a record $906.5 million. The firm said privates sales are a sector of its business that is growing in importance.

"Sotheby's ended the year with a very strong balance sheet and we are continuing to invest in our business," explains Ruprecht. "As a result, 2012 was a year of meaningful progress in the development of our client-focused strategy. We have totally re-engineered our post-sale client services in our key sales centers of London and New York and made an array of enhancements to facilitate and personalize the client experience.

In its diamond and jewelry business Sotheby's earlier this year announced record jewelry sales in 2012 of $460.5 million, with robust growth at all of its global auction offices.