Because of the seasonal nature of the art auction market, first and third quarter results have historically reflected a lower volume of auction activity when compared to the second and fourth quarters and, typically, a net loss due to the fixed nature of many of Sotheby's operating expenses. As a result, first quarter results are typically not indicative of expected full year results. Management believes that investors should focus on results for six and twelve month periods, which better reflect the auction market business cycle.Net loss for the three months ended March 31, 2013 was ($22.3) million, or ($0.33) per diluted share, as compared to ($10.7) million, or ($0.16) per diluted share in the prior period. This decrease is largely due to the aforementioned decline in auction commission margin and to a lesser extent, an 8% increase in operating expenses, which in large measure is attributable to planned investments in support of Sotheby's strategic initiatives, including the development of Sotheby's presence in growth markets.
Sotheby's Reports First Quarter 2013 Financial Results
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