Auction house Sotheby's ( BID), feeling the effects of the plummeting international art market, slashed its annual dividend and announced jobs cuts today in an effort to save money.

Cost-cutting initiatives sent shares up 9% to $10.88 in afternoon trading.

The auction house said it will now pay an annual dividend of 20 cents a share, down 67% from its earlier rate of 60 cents. Dividend payments are expected to be reduced to about $14 million from $41 million.

Sotheby's also said it will scratch an additional 5% of its workforce during the year on top of a 15% cut in 2008. This will result in annual savings of about $24 million, with about $15 million realized in 2009.

The company will also implement salary cuts for some senior staff, unpaid furloughs for employees and a reduction in U.S. pension contributions. It expects cost savings of about $160 million in 2009 as a result of these cost cutting initiatives.

Auction houses have been fighting a slowdown in the global art market.

Both Sotheby's and rival Christie's are heading into the spring season with fewer pieces to sell and lower estimates.

On May 5, Sotheby's is offering 36 impressionist and modern works in a sale that is traditionally reserved for its best merchandise. The sale is expected to bring in $118.8 million, compared to last spring when 52 lots sold for $235.4 million. The company's contemporary evening sale on May 12 has 49 lots and is expected to bring as much as $72.7 million. In 2008, $362 million was realized for 83 contemporary works.
Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.

If you liked this article you might like

Here Is What Activist Funds Are Saying About Tesla's Board Shake Up

Sotheby's Sets Record For Most Expensive Earrings

Sotheby's, Christie's, Phillips Set for Billion Dollar Week

Wall Street Dissects What Trump's Comey Firing Means for Agenda, Disney Drags on Dow