Sothbey’s faces 10.7% loss in revenues in September 2008

Sotheby’s has announced its financial results for the third quarter ending September 30, 2008, in which it faced a dip of 10.7 percent in its revenues, amounting to $75.973 million. It also accounted a loss of $46.2 million, and as compared to the same period last year, the loss was more than double. This year’s third quarter loss has been a historic loss for the company.

Decline in sales was blamed on the higher level of principal losses on auction guarantees, lower private sale commissions and lower auction commission margins. Also, the net loss for the said quarter was attributed to increased direct costs, higher borrowing costs, lower effective income tax rate, all culminating into lower income tax benefit for the period.

On a broader scale of the first nine months of the year 2008, Sotheby's did not enjoy an increase, rather a fall of 8.2 percent in revenues which amounted to $525.4 million, placing profits down by 67 percent to $36.721 million.