Sotheby's posts record earnings

NEW YORK -- Sotheby's, one of the world's largest art sellers, said Tuesday fourth-quarter profit rose 46 percent to a record, helped by a surge in auction commissions and an emphasis on higher-priced works.

Net income for the New York-based company rose to $102.4 million, or $1.55 per share, from $70.3 million, or $1.09, a year earlier. Revenue increased 31 percent to $345.8 million.

Analysts on average expected profit of $1.47 per share on revenue of $344 million, according to Reuters Estimates.

Results improved despite a poor early November auction in New York of Impressionist and modern art, in which a late Vincent van Gogh landscape went unsold, while works by Paul Gauguin and Pablo Picasso sold below estimates. Sotheby's shares fell more than 28 percent the following day.

But in December, a rare 710-year-old copy of the Magna Carta, one of 17 known to exist and the last in private hands, sold at a Sotheby's auction for $21.3 million.

Sotheby's said it sold 41 lots above $10 million in 2007, up from 20 a year earlier, as it "strategically reduced" lot volume by 42 percent at the low end.

It said the number of customers buying "top end" works rose more than 200 percent.

"Our focus is on quality, not on quantity," Chief Executive William Ruprecht said on a conference call Tuesday.

Sotheby's also said it has had a strong start to 2008, including an $82.5 million sale in January of Old Masters paintings, and $285 million of sales this month of Impressionist and modern art in London.

For all of 2007, profit roughly doubled to $213.1 million, or $3.25 per share. Revenue rose 38 percent to $917.7 million.

Sotheby's shares closed up $1.27, or 3.9 percent, at $34.17 on Tuesday on the New York Stock Exchange.