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SOTHEBY'S $200 MILLION 'F-1' CP PROGRAM AFFIRMED BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, March 9 /PRNewswire/ -- Sotheby's Inc.'s $200 million U.S. commercial paper program is affirmed at 'F-1' by Fitch.
 The rating reflects Sotheby's strong balance sheet, cash flow generating ability, conservative fiscal policies, and its worldwide market leadership among fine art auction houses.
 Sotheby's continues to operate under conservative fiscal policies with respect to its balance sheet and cost controlling efforts in order to weather the depressed market conditions of the 1990's. Fiscal 1992 sales are anticipated to be at approximately 1991's level. This is due to a sluggish auction performance through most of the year. However, there was a noticeable improvement in the winter selling season. Sotheby's was able to maintain profitability through cost reduction efforts which will continue throughout 1993. Despite relatively flat sales and earnings in 1992, Sotheby's is expected to report strong net cash flow from operations as a result of reducing its inventory and finance receivables.
 Fiscal 1993's sales and earnings outlook should moderately improve. There appears to be momentum in the art market based on winter's successful sales. Sales will also benefit from the increase in the buyer's commission to 15 percent from 10 percent on the first $50,000 of an item's purchase price. The increase in the buyer's commission is expected to increase revenues by $20 million to $25 million and would directly improve operating profits.
 Sotheby's strength throughout this downturn has been its balance sheet, which gives it financial flexibility. Sotheby's is expected to have over $215 million of equity at fiscal year-end Dec. 31, 1992 and debt of $100 million, resulting in leverage over 31 percent. However, cash balances are expected to approximate total debt outstanding at year end. Furthermore, Sotheby's is maintaining its conservative fiscal policies with respect to its financing activities and has actively managed the finance receivables to comply with its stringent requirements. However, a change in current lending practices, any purchase of inventory for its own account, or a significant deterioration of the equity base could result in the rating being lowered.
 Sotheby's is the world's leading fine art auctioneer. Founded in 1744, it operates in 36 countries and holds over 450 auctions annually. Sotheby's is also involved in art-related financing and in marketing and brokering of luxury real estate.
 -0- 3/9/93
 /CONTACT: call Anne Marie May of Fitch, 212-908-0589/
 (BID)


CO: Sotheby's Inc. ST: IN: SU: RTG

SB -- NY064 -- 4579 03/09/93 14:20 EST
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Date:Mar 9, 1993
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