Sotheby's Announces 2008 Second Quarter and First Half Results

* Second Quarter Revenues of $320.2 million and Operating Income of
$150.9 million
* Second Quarter Net Income of $95.3 million and Diluted Earnings
per Share of $1.46
* Sotheby's Sells the World's Most Expensive Contemporary Work at
Auction, Francis Bacon's Triptych, 1976, for a Record $86.3
million
NEW YORK, Aug. 5, 2008 (PRIME NEWSWIRE) -- Sotheby's (NYSE:BID) today announced
results for the second quarter and first half ended June 30, 2008.

For the quarter ended June 30, 2008, the Company reported revenues of $320.2
million, a $19.3 million, or 6%, decrease over the prior second quarter,
primarily due to the shift of our summer Contemporary sales in London from the
second quarter of 2007 to the third quarter of 2008. Those sales brought auction
commission revenues of $24 million in the second quarter of 2007 and will
contribute approximately $26 million to auction commission revenues in the third
quarter of 2008. Auction commission margin in the second quarter of 2008 was
15.1% which is much improved from the 13.6% auction commission margin in the
first quarter of 2008 although not quite as high as prior year second quarter
auction commission margin of 16.0%. Also impacting revenues in the second
quarter of 2008 are unfavorable principal activities results for the period.

The Company's net income for the second quarter of 2008 was $95.3 million, or
$1.46 per diluted share compared to net income of $107.3 million, or $1.64, per
diluted share for the prior period, a $12.0 million decline, largely due to the
aforementioned calendar shift. This decline is partially offset by lower
operating expenses, which totaled $169.3 million compared to $182.0 million in
the prior period, a $12.8 million, or 7% improvement. Operating expenses include
an $18.4 million one-time benefit ($11.7 million after-tax) recognized as a
result of the reversal of the remaining liability related to the vendor's
commission discount certificates that expired in May 2008 and were issued by the
Company in 2003 in conjunction with the settlement of antitrust related civil
litigation. The reduction in operating expenses is also partially attributable
to a decrease in incentive bonus accruals as a result of the lower profitability
of the first half and is somewhat offset by increased direct costs, primarily
due to higher consignment and sales levels in Hong Kong, as well as higher
catalogue and sale promotion costs related to the May Impressionist and
Contemporary Art sales in New York.

For the first six months of 2008, aggregate auction sales were $3.0 billion, a
record for Sotheby's, and revenues were $449.4 million, a $37.5 million, or 8%
decline from the prior period due to the previously mentioned sales shift from
the second quarter to the third quarter ($24 million revenue benefit in the
first half of 2007) as well as lower auction commission margins and unfavorable
principal activities results in the current period. Net income for the first
half of 2008 was $82.9 million, a $48.7 million, or 37%, decline from the first
half of 2007 largely due to the aforementioned shortfalls in auction and related
revenues. Diluted earnings per share was $1.26 for the first half of 2008, a 38%
decrease from the prior period.

"These results are the second best in our history, and are remarkable in the
context of today's global economic environment," said Bill Ruprecht, President
and Chief Executive Officer of Sotheby's. "Our conservative approach to risk,
the significant improvement in our auction commission margins in the second
quarter and our focus on costs have all contributed to healthy profitability.

"Our ability to successfully raise $350 million in new capital in this climate -
in an oversubscribed offering - now provides us with greater liquidity than we
have ever enjoyed," continued Mr. Ruprecht. "Sotheby's was upgraded to
investment grade by Standard & Poors in early June and we have retired our $100
million bond that was due in February 2009. Our company today is in an excellent
position to be flexible and competitive and to continue our long tradition as
innovators in our markets. Demand has remained very strong for great works of
art, and the market has continued to be robust, recently illustrated by our
excellent summer sales in London. Aggregate auction sales to date of $3.4
billion are up 14%.

"We are encouraged by a number of exciting events that are ahead in the autumn
season. Notable among them is the landmark sale in London, 'Beautiful Inside My
Head Forever,' consisting of over 200 new and exciting works by renowned artist
Damien Hirst, which is estimated in excess of $130 million. Because of this
sale, as well as the strong results in London of our Contemporary and Old Master
sales in July, we expect a stronger third quarter than last year."

Second and Third Quarter Sales

In a most eventful season, Sotheby's sold the top lot of the year thus far,
Francis Bacon's Triptych, 1976 for $86.3 million, setting the record at auction
for the artist as well as for any work of Contemporary Art. This masterpiece was
sold in our May evening sale of Contemporary Art in New York, an auction which
brought $362.0 million, our highest single sale total in Company history. The
week's total of Contemporary Art sales were $469.8 million, at the pre-sale high
estimate of $473 million and up 36% from the prior year with eight works selling
for $10 million or more. The New York May Impressionist sales also achieved
excellent results with a total of $272.6 million, well within the pre-sale
estimate of $245/337 million.

Also in New York, Sotheby's spring sale of American Paintings brought an
exceptional $87.0 million, well above the high end of the pre-sale estimate of
$53/77 million and 56% above the prior year's total. Highlighting the sale was
Edward Hick's Peaceable Kingdom which achieved $9.7 million and set the record
for a work of American Folk Art as well as the record for the artist at auction.

Sotheby's summer fine arts sales in London in late June and early July were the
best in our history, bringing a remarkable $497.5 million over the two week
period, near the high end of the pre-sale estimate of $358/511 million and 24%
above the prior year's total. The Impressionist and Modern Art sales brought
$255.1 million and were highlighted by the sale of Gino Severini's Danseuse for
$29.6 million, seven times the previous record for a work by the artist.
London's Contemporary Art sales totaled a tremendous $242.4 million and were
highlighted by the sale of Francis Bacon's Study for Head of George Dyer for
$27.4 million, well in excess of the pre-sale high estimate of $16 million. A
remarkable 102 lots were sold for $1 million or more during the two week period.

Sotheby's July Old Masters sales in London brought a strong $117.3 million,
above the pre-sale high estimate of $105.5 million and 32% above the prior
year's total. The top lot of the sales was a re-discovered portrait by Frans
Hals of Willem van Heythuysen which sold for $14.0 million. Auction records were
set for nineteen artists and twenty lots were sold for $1 million or more.

Upcoming Sales

On September 15th and 16th in London, Sotheby's is privileged to present
"Beautiful Inside My Head Forever," a major auction of new works by Damien
Hirst. The over 200 lots in the two day sale were all created over the past two
years and incorporate an extraordinary range of works. The centerpiece of the
evening sale is The Golden Calf, a remarkable new sculpture of a bull in
formaldehyde whose head is crowned by a solid gold disc and hooves and horns are
cast in 18 carat gold. The sculpture is estimated to realize $16/24 million and
the entire sale is estimated to bring in excess of $130 million.

Sotheby's Hong Kong autumn sales will be held from October 4th to 8th and are
estimated to total approximately $265 million which is 31% higher than last
fall's sales total of $202.4 million. Highlighting the sales are the Qianlong
Imperial Seals from the Estate of Emile Guimet (estimate in excess of $6.4
million), as well as two exceptional scrolls, the Dayue Tu, the Qianlong
Emperor's Review of the Grand Parade (estimate in excess of $10.2 million) and
the Compilation of the Lanting Xu Imperial Collection of Documents Woven in Kesi
(estimate in excess of $7.7 million).

For the third year in a row, Sotheby's will be visiting Chatsworth in the
British countryside with a major exhibition of Modern and Contemporary
sculpture, Beyond Limits. Works by artists such as Fernando Botero, Kiki Smith,
Ron Arad and Salvador Dali will be displayed and available for private sale. The
exhibition will run from September 9th to November 2nd.

On October 2nd Sotheby's Paris will offer the late Swiss businessmen Leon Levy's
Collection of Important French Furniture and Works of Art, which is estimated to
bring $9/16 million. Highlights from the exquisite 18th century collection will
include a pair of gilt-bronze candelabra from the Louis XVI period (estimate of
$1/2 million) and a gilt-bronze console-table from the Regence period (estimate
of $0.9/2 million).

In November, Sotheby's New York will present for sale three important paintings
by the Russian artist Boris Dmitrievich Grigoriev on behalf of the Berkshire
Museum in Pittsfield, Massachusetts. Included in the offering is Grigoriev's
Pipe Players, a preeminent example of the artist's Visages du Monde (Faces of
the World) cycle of 1920-31. Shepherd of the Hills, which depicts Russian poet
Nikolai Klyuev, and Man with Pipe will also be offered. The three paintings are
estimated to bring $7/10 million combined.

Note: All estimates do not include buyer's premium.

About Sotheby's

Sotheby's is a global company that engages in art auction, private sales and
art-related financing activities. The Company operates in 40 countries, with
principal salesrooms located in New York, London, Hong Kong and Paris. The
Company also regularly conducts auctions in six other salesrooms around the
world. Sotheby's is listed on the New York Stock Exchange under the symbol BID.

Forward-looking Statements

This release contains certain "forward-looking statements" (as such term is
defined in the Securities and Exchange Act of 1934, as amended) relating to
future events and the financial performance of the Company. Such statements are
only predictions and involve risks and uncertainties, resulting in the
possibility that the actual events or performances will differ materially from
such predictions. Major factors, which the Company believes could cause the
actual results to differ materially from the predicted results in the
"forward-looking statements" include, but are not limited to, the overall
strength of the international economy and financial markets, political
conditions in various nations, competition with other auctioneers and art
dealers, the amount of quality property being consigned to art auction houses
and the marketability at auction of such property. Please refer to our most
recently filed form 10-K for a complete list of Risk Factors.

Financial Table Follows

All Sotheby's Press Releases and SEC filings are available on our web site at
www.sothebys.com. In addition, an outline of the conference call is available at
http://investor.shareholder.com/bid/events.cfm.

Sotheby's earnings conference call will take place on Tuesday, August 5, 2008,
at 4:45 PM EDT. Domestic callers should dial: 877-548-7915 and international
callers should dial: 719-325-4869. The call reservation number is 2194084.

To listen to the conference call via web cast, please go to
http://investor.shareholder.com/bid/events.cfm

You will need Windows Media Player or Real Player to access the call. Please
download either of these programs before the call begins. The web cast will be
available for replay for two weeks after the call.

SOTHEBY'S APPENDIX A
CONDENSED CONSOLIDATED INCOME STATEMENTS
(UNAUDITED)
(Thousands of dollars, except per share data)

Three Months Ended Six Months Ended
-------------------- --------------------
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
--------- --------- --------- ---------
Revenues:
Auction and related
revenues $290,393 $313,479 $398,331 $443,296
Finance revenues 3,650 4,219 7,162 8,999
Dealer revenues 24,791 20,495 41,476 32,341
License fee revenues 918 822 1,509 1,402
Other revenues 409 492 944 868
--------- --------- --------- ---------
Total revenues 320,161 339,507 449,422 486,906
--------- --------- --------- ---------

Expenses:
Direct costs of
services 35,162 25,780 48,719 39,342
Dealer cost of sales 24,679 17,167 40,597 25,532
Marketing expenses 5,597 4,926 10,946 9,093
Salaries and related
costs 71,903 85,090 133,074 139,894
General and
administrative
expenses 44,328 43,772 89,792 81,821
Depreciation and
amortization expense 6,005 5,312 12,217 10,794
Antitrust related
matters (18,385) -- (18,385) --
Impairment loss -- -- -- 14,979
Gain on sale of land
and buildings -- -- -- (4,752)
--------- --------- --------- ---------
Total expenses 169,289 182,047 316,960 316,703
--------- --------- --------- ---------

Operating income 150,872 157,460 132,462 170,203

Interest income 2,064 3,972 3,976 6,694

Interest expense (8,002) (7,133) (15,252) (14,668)
Insurance recovery -- -- -- 20,000
Other (expense) income (3,794) 51 (1,171) 1,730
--------- --------- --------- ---------

Income before taxes 141,140 154,350 120,015 183,959
Equity in earnings of
investees, net of
taxes 300 1,040 1,537 1,749
Income tax expense 46,106 48,042 38,613 54,028
--------- --------- --------- ---------

Net income $95,334 $107,348 $82,939 $131,680
========= ========= ========= =========

Basic earnings per
share $1.47 $1.68 $1.29 $2.08
========= ========= ========= =========

Diluted earnings per
share $1.46 $1.64 $1.26 $2.02
========= ========= ========= =========

Basic and diluted
weighted average
shares outstanding:
Basic 64,663 63,750 64,529 63,453
Diluted 65,390 65,561 65,695 65,319

Cash dividends paid per
common share $0.15 $0.10 $0.30 $0.20
-0-
CONTACT: Sotheby's
Press Department:
Diana Phillips
(212) 606-7176
Investor Relations:
Jennifer Park
(212) 894-1023