Thank you, Michelle. Good morning and thank you for joining us today.

With me here are Tad Smith, Sotheby's President and Chief Executive Officer and Patrick McClymont, Chief Financial Officer. GAAP refers to generally accepted accounting principles in the United States of America.

In this earnings call, financial measures are presented in accordance with GAAP and also on an adjusted non-GAAP basis. An explanation of the non-GAAP financial measures used in this earnings call, as well as reconciliation to the comparable GAAP amount is provided as an appendix to the earnings release, which can be found on the Investor Relations section of the company's web site.

Also during the course of this call, the company may make projections or other forward-looking statements regarding future events or the future financial performance of the company. We wish to caution you that such projections and statements are only predictions and involve risks and uncertainties, resulting in the possibility that the actual events or performance will differ materially from such predictions.

We refer you to the documents the company files periodically with the Securities and Exchange Commission, specifically the company's most recently filed Form 10-Q and 10-K. These documents identify important factors that could cause the actual results to differ materially from those contained in the projections or forward-looking statements.

Please see our investor webpage for a slide presentation which outlines Sotheby's third quarter financial results. Now, I will turn the call over to Tad.

Thank you, Jen. Good morning everybody and thanks for joining us and for your interest in Sotheby's.

Before turning things over to Patrick to review our third quarter financial results in detail, I wanted to provide an update on recent sales and some insights on the marketplace as well as outline the progress on our strategic priorities. These are very exciting time at Sotheby's.

We just completed an historic few days with the New York sales of property from the Alfred Taubman collection as well as our traditional Impressionist and Modern Art sales totaling $708 million last week. Our galleries around the world played host to tens of thousands of visitors over the course of just a few short weeks.

I want to take this opportunity to thank all of my colleagues here at Sotheby's for a job well done in executing these historic sales flawlessly. Ours is the best team in the business and they are performing at a high level for our clients and our shareholders.

The Taubman sales last week brought a combined $420 million and as we stated at the end of last week, we expect to cover the guarantee in its entirety and we will have more to say about that later on, in the call. The Taubman Masterworks sale was highlighted by Modigliani's portrait of Paulette Jourdain, which sold above expectations for $42.8 million in its first ever appearance at auction, as well as Frank Stella's Delaware Crossing which doubled the previous record for the artist at auction when it sold for $13.7 million.

in addition to bringing tens of thousands of collectors and visitors into our galleries, the auctions captivated an audience far beyond our global premises. The webcast of last Wednesday's night auction was by far our most viewed auction to-date with more than 5,000 people following along on our website.

The series of videos we produced about the collection were watched for over 12,000 hours and posts across our social media channels garnered 2.7 million impressions. I will have more on some of our digital developments shortly.

Our Impressionist and Modern Art various owner sales totaled $360 million, above the $322 million low estimate, bringing our annual worldwide total to $1.7 billion for the category, already the highest annual total for the category and company history with more sales still to come before the end of the year. Highlighting the sales were Pablo Picasso's La Gommeuse which sold for $67.5 million dollars and established a new record at auction for Blue Period Picasso.

And Van Gogh's Arles period Landscape which sold for $54 million driving our offering of works from The Collection of Louis & Evelyn Franck to $98.5 million total. Last month, our autumn sales in Hong Kong totaled $342 million, exceeding the presale low estimate of $295 million and with close to 3,000 lots sold over the course of the week.

Collectors were selective but willing to compete for rarities of the highest quality as evidenced by outstanding prices achieved for Ming furniture from the Yip collection, an early abstract work by Yayoi Kusama and an Imperial portrait by Giuseppe Castiglione, to name a few. Also last month, our Frieze Week sales of contemporary and a tie-in art in London performed well.

The sales brought a total of $139 million, above the high presale estimates of $111 million. More than 10,000 visitors prodded our galleries for exhibitions and events and this excitement carried through into packed salesrooms that saw bidding from around the world.

Looking for the immediate future, our contemporary art sale this week in New York carry a presale estimate of $336 million to $439 million. Highlighting the sales is Cy Twombly's epic Untitled, New York from his celebrated Blackboard series, which is a presale estimate in excess of $60 million and Andy Warhol's iconic Mao painting which has a presale estimate above $40 million.

Also coming up this week is our Magnificent Jewels sale in Geneva, which has a presale estimate $112 million to $170 million and is highlighted by the Blue Moon, an exceptional fancy vivid blue internally flawless diamond weighing 12 carats and carrying a presale estimate of $35 million to $55 million. We still have works from the Taubman collection to be sold starting next week here in New York with the dedicated sales of American art from Martin Johnson Heade's undeniable masterpiece, The Great Florida Sunset to Winslow Homer's watercolor, The Summer Cloud with presale estimates of $7 million to $10 million and $1.5 million to $2.5 million dollars, respectively.

And in January, also in New York, Mr. Taubman's impressive collection of Old Master will be offered including rare works by renaissance artists, Raphael and Dürer along with one of the strongest groups of Italian Baroque material in private hands.

There are also a number of classic 18th-century British pictures such as The Blue Page by Thomas Gainsborough which carries a presale estimate of $3 million to $4 million. Turning now to the bigger picture.

There were four priorities announced when I joined in March and we have made good progress. The priorities are, first, Sotheby's needs a compelling growth strategy.

Second, we need to embrace technology more effectively both internally and through client facing products. Third, we must attract, develop and retain the talent within the organization as well as processes to succeed.

Fourth, we need to allocate capital well. With a little more than seven months on the job, I thought I would expand on our progress against each of these four priorities.

With respect to the first priority, having a compelling growth strategy, we have approved strategic plan with the Board. The first element of this strategy is to recognize that our at the high end of the fine art market helps define our brand's luster across many different categories and that there was some work to do in this area.

We have already begun making changes on how we secure consignments, how we hedge our guarantee exposure and how we collaborate across groups to identify specific client and product opportunities. We will plan for improving our private sales execution that will be implemented for next year.

For competitive reasons, I don't want to say much more about this but there are many more things to come. A more systematic review of our position within various markets is another critical aspect of our strategy and we have regional changes planned for the Western Hemisphere soon to be implemented together with some planned improvements in Europe and Asia in the first part of 2016.

With respect to jewelry, we have seen some headwinds in Asia and the Americas throughout the year but we have made good progress in developing a strategic plan to grow our branded private jewelry sales business. I am proud of enhancements we have made in the marketing of jewelry and a group leader search is underway to fill out the organization to fuel future growth.

There are also partnerships we have considered to accelerate our growth profile in that space and we will keep investors apprised of developments. Sotheby's car business continues to make progress and our financing business which has delivered outstanding results to-date has added a key sales resource to propel future growth in both total number of loans and loan size.

We are also developing a strategy for our wine business, in particular looking at digital options to grow that business but the planning remains very early days. The middle market has, throughout the year, been a little more sluggish in the auction room than we would have liked.

At the same time, our strategy to seek partners and develop internal digital capabilities to expand our reach among middle market buyers has been making progress. One fascinating statistic is the total transacting clients for Sotheby's through September 30 versus the same period in 2014 grew by 8% to a new record, while our overall number of transacting managed clients, by whom we mean those clients were assigned a personal client manager, was very slightly down.

In other words, the number of clients who are very big buyers or consigners is down very slightly, but it was more than made up for in terms of the number of clients with growth in new self-service or future managed clients. Incidentally managed clients were less than a quarter of our total transacting clients.

While I could discuss this as part of capital allocation, I think the company's real estate decisions are really also strategic ones. Right now, we have three different real estate strategies deployed around the world for our auction sales.

In New York, we have a building that we own which is a large auction room, as well as separate dedicated exhibition space co-located with our office, support and logistical staff. The New York building many fantastic qualities, but it is not clear that we are utilizing the space well and there are also logistical challenge to moving large numbers of people through it easily.

In London, we have a group of attached buildings which we both own and lease that converts the exhibition space into the auction room for sales. The London space does not fully take advantage of its prime location with its retail front and is a bit chopped up and unwieldy to navigate.

Neither of the locations fosters teamwork and collaboration across divisions in groups. The Hong Kong location has a leased office space and gallery space in a commercial office tower combined with their auction sales and exhibitions in the convention center.

Paris, Milan and Geneva use the London model. In other words, within our own company, we deploy at least three different models of space utilization.

We are undertaking a review of our real estate in New York to carry us into the future. I anticipate this decision will play out in the first couple of quarters next year before the announcement is made and the good news is that we own our space, are in no rush and have the time and flexibility to get the answer right.

What that decision will be, is not yet certain, but staying and refreshing our current building for the future or finding new space are the two leading candidates. In London, we are looking to freshen our existing space.

Milan has just moved to a beautiful new location and Geneva is also reflecting on the right space for its needs. Paris works well for our current needs.

Turning from strategies to the second priority. We must embrace technology more effectively with both our clients and our internal systems.

We have also make good progress here. We have made several significant hires as part of our investment in technology and digital developments.

In July we named a new Chief of Digital Development and Worldwide Marketing. Shortly thereafter we named a new Head of Marketing Analytics and Customer Information and next week we have a new Head of Worldwide Technology and Operations joining the company.

We are very pleased with our early progress in these areas. Examples abound.

We now have more followers on social media, including Twitter, Instagram, Facebook, Weibo and WeChat than our competitors. Our social media audience is growing faster than our competitors and our audience is the most engaged one in the art vertical.

Engagement measures new fans, mentions, likes, shares, comments, et cetera and Sotheby's have more than doubled the engagement as the largest art gallery and five times greater than our nearest auction competitor. Already in 2015, we have had more website visitors than in all of 2014 and the average time they are spending our site is seven minutes, which is more than twice that our nearest auction competitor.

Certainly in part due to the Taubman sales, we had 24% more visitors to our website in October than we did a year ago and we have integrated streaming of our auction sales via Facebook to help our streaming hit an all-time high during the Taubman Evening Sale last week. Contributing to the high digital traffic growth, we have provide a fivefold increase in original digital content from July through October of this year versus the same period last year and we did an incredible 25 videos for consumption both digitally and on-site for the Taubman collection alone.

Art is about passion and video captures the magic of art better than almost any other medium, with the possible exception of real-life viewing. An example of engagement we are seeing as a result of this new content strategy, on Friday we posted a slide show of the 17 paintings that top $10 million last week.

The slideshow has already is more than 115,000 views putting it on track to be our most viewed ever. Our strong work here has led to a 65% increase in online bidders, a 41% increase in online bidders than the same time last year and a 47% increase in lots sold online versus the same time last year.

In October, we conducted our first online only auction in recent memory and exceeded the high estimate in a small but a very encouraging sale. We also partnered with Artsy during the last week of October to execute a small but novel sale and we learned a great deal about how to blend our capabilities with those of the emerging tech space.

We also have the opportunity to expand our client contacts in the critical growth area of Silicon Valley. Speaking of Silicon Valley, it's worth a nod to our eBay partnership.

We have had a 9% total increase in auction registrants in North America this year to-date, but the number jumps to 41% if eBay is included. And if that were not enough, we had one online buyer in a recent wine sale who spent over $1 million online and we even sold a Mark Chagall painting for almost $1.3 million hammer to an online bidder last week in our New York salesroom.

Of particular interest to me is that online bidders through September 30 as a percentage of total transacting clients has risen to 12% this year versus 8% last year. And this progress comes despite the fact they were still working to launch a mobile application due in the first quarter of next year, refresh our iPad application expected after the mobile app and further enhance the user experience and engineering of our website.

The third priority for us is people. We must attract, develop and retain the talent within the organization as well as to create the processes for success.

In terms of attracting talent, we have added many new capabilities to the organization and we are actively recruiting to fill gaps in the specialist areas and some client areas. The Board has also approved changes to bring more transparency and accountability for results to our personnel.

Our compensation programs in 2016 will evolve to align pay with the achievements of the company, teams and individuals. The performance metrics for annual incentives will vary with roles but will focus on group profitability and individual scorecards for both business functions and specialists and team and individual scorecards for key client management personnel.

We will be rolling this out in the coming weeks. In December, we will roll out a talent planning process.

This will be a regular process for us and these sessions will involve managers across the company helping identify top talent, plan for their development and deepen our bench. One of the most delightful surprise of the year has been how many excellent less tenured staff appeared our initial list of high potential talent within our organization.

These people are bursting with energy to change the world of art, jewelry, cars or wine and my more senior colleagues and I need to find creative ways to give them room to run and innovate. There will be a bit of change coming to our organization but the adjustments will be healthy for the company.

Organizationally, we are moving toward a focus on global roles which reflect our key capabilities of client development specialist expertise across the major departments, marketing, technology and operations. Our sales this past week were global in every way.

Our clients were from around the world and our chairman, client managers and specialists operated as a global team across regions to bring in the bids. The final priority is to allocate capital well and wisely.

Let me begin first with our guarantee policy. In the interest of clarity for all of our shareholders, I thought it made sense to repeat what I said in the first earnings call about this policy and then speak specifically on the Taubman guarantee.

Here is what I said on the call, we will not roll dice in the auction room with shareholders' money. At the same time, guarantees on high profile trophy lots can be important marketing investments and potentially generate positive momentum and product scope within our categories.

Strategy, opportunity, judgment and sensible risk management will guide our use of these guarantees. That's what I said.

Let me now comment on the Taubman guarantee decision in the context of what I said in the first earnings call. Some are asking whether the Taubman guarantee, which thus far has not involved any third-party hedges is a sign of things to come under my leadership?

The answer is no. There was only one Alfred Taubman.

Only his collection have both the size and the unique importance for Sotheby's shareholders to make this consignment important to win. We will certainly make future guarantees and some of these may be large on significant pieces or on major collections.

But we continue to have a firm and prudent policy guided by strategy, opportunity, judgment and sensible risk management in undertaking them. The next major capital allocation question concerns what businesses we intend to invest in and where do we see opportunities for greater efficiencies.

The budget process is well underway and throughout the balance of this week, the corporate management will be reviewing the first draft of budgets for the Board meeting in early December. Over the past weeks and months, macro economic uncertainties have us carefully looking at our expenses for 2016.

As part of that process, we will probably need to make some adjustments. Elsewhere on the capital allocation front, we have been very busy and very productive indeed, including the recent upsizing of our revolving credit facility for future growth of our finance business, the July refinancing of our York Avenue property which resulted in interest savings and the recent announcement of our $125 million accelerated share repurchase program, which has already retired 2.7 million shares and is still ongoing.

And that seems like an excellent segue for my colleague Patrick to take over from here.

Thank you, Tad. I would also like to thank the team here at Sotheby's for their very strong performance in our fall sales so far.

I was particularly pleased to see how well the whole team came together for the Taubman sales and demonstrated great creativity, dedication and collaboration to drive strong execution of a complex project under a remarkably tight set of deadlines. Well done.

I will use the slide presentation we published this morning for my comments. Please turn to slide three of the deck.

Third quarter 2015 adjusted net loss is $17.9 million and adjusted diluted loss per share is $0.26 compared to $20.6 million and $0.30, respectively a year ago. For the nine month period, adjusted net income is $62.5 million and adjusted diluted EPS is $0.90 compared to $64.3 million and $0.91 last year.

The adjusted figures exclude restructuring and special charges as well as CEO separation and leadership transition costs. Now let's look at our main operating segments.

Starting with the agency segment on slide four, gross profit increased approximately $1 million or 1% in the third quarter, primarily due to the completion of a number of profitable inventory sales in the period. Agency gross profit decreased $16 million or 3% in the year-to-date period, largely due to unfavorable movements in foreign currency exchange rates.

The shift in the timing of the London Contemporary Evening Sale from the second quarter of 2014 to the third quarter of 2015 drove an overall increase in third quarter 2015 net auction sales of $48 million or 15%. However third quarter auction commission revenues decreased $8 million or 12% due to lower sales in our regular third quarter auctions of Old Master Paintings and British Art, Asian Art and Jewelry, which are higher margin categories.

Also unfavorable foreign exchange movements contributed $4 million to the decrease in third quarter auction commission revenues. On a year-to-date basis, unfavorable foreign exchange movements contributed $22 million to the decrease in year-to-date auction commission revenues.

Excluding foreign exchange impact, year-to-date auction commission revenues improved $11 million or 2% due to a $98 million or 3% increase in net auction sales, principally attributable to the growth in the Impressionist and Modern Art and Contemporary Art collecting categories. Contributing to the overall decrease in auction commission revenues is a decline in auction commission margin from 19.9% to 15.2% in the third quarter and from 15.5% to 15.3% in the nine month period when compared to the prior year.

This is due to higher level of shared auction commissions and the unfavorable impact of a change in sales mix as higher value properties sold in the upper price bands of Sotheby's buyer's premium rate structure. Specifically, the change in timing of the London Contemporary Art Evening Sale into the third quarter result in a significantly higher level of shared auction commissions due to the competitive environment for consignments in this category.

For the full nine month, the decline in auction commission margin is largely offset by the positive impact of the increased buyer's premium rate structure enacted earlier this year. For the three months ended September 30, 2015, private sale commissions decreased $2.5 million or 21% due to a lower volume of transactions completed.

For the nine month period, private sale commissions increased $1.3 million or 3%. Also impacting agency segment gross profit is a $3 million or 70% increase in auction direct costs in the quarter, which is largely due to the movement of London Evening Contemporary Art Sale into the quarter.

In the nine month period, auction direct costs increased $5 million or 12% when compared to prior year, primarily due to the higher costs incurred to promote and conduct Sotheby's Impressionist and Contemporary Art sales in 2015. Moving to slide five.

We see continued strength in Sotheby's financial services. For the year-to-date period, the average loan portfolio balance was $733 million, a 33% increase from the prior year.

As of the end of September, the period ending loan balance was $759 million and credit facility borrowings were $580 million, resulting in a leverage ratio of approximately 76%. Finance segment revenues increased $5 million or 47% in the quarter and $16 million or 50% in the nine month period, reflecting the growth of the portfolio.

Finance segment gross profit, which is net of borrowing costs, increased $4 million or 42% in the quarter and $10 million or 37% in the nine month period. Finance segment results in the year-to-date period were also favorably impacted by a $1.3 million collateral withdrawal fee earned in the first quarter.

Withdrawal fees are not common. The finance segment's return on equity is 14.3% for the current LTM period ending September 30, 2015.

Assuming our current leverage of 76%, the LTM return on equity would have been 17.4%. Excluding the withdrawal fee and assuming our current leverage of 76%, the LTM return on equity would have been 16.7%.

Either way, ROEs are above our target of 15%. Next on slide six.

Salaries and related costs decreased $2 million or 3% in the third quarter and increased $6 million or 2% in the first nine months as compared to a year ago. The year-to-date period is affected by leadership transition severance costs of $10 million incurred in the second quarter in association with the departure of certain executive officers, including our Chief Operating Officer.

Full-time salaries decreased $1 million or 2% in the third quarter and $3 million or 3% in the first nine months, principally due to changes in foreign currency exchange rates, $2 million and $6 million respectively and savings resulting from the restructuring plan enacted in July 2014, partially offset by base salary increases and headcount reinvestments. For the third quarter, share-based payment expense increased $2 million or 37%, primarily due to higher amortization of CEO share-based payment awards and management's quarterly assessment of the likelihood that performance based equity awards will vest.

For the nine month period, share-based payment expense increased $4 million or 23%, largely due to the accelerated recognition of $2 million of compensation expense in the second quarter of 2015 related to the terms of the severance agreement with Sotheby's Chief Operating Officer and higher amortization of CEO share-based payment awards. For the three and nine months ended September 30, 2015, employee benefit costs decreased $2 million or 30% and $1 million, or 6%, respectively, when compared to the prior-year periods.

These decreases are primarily due to decreases of $2 million and $3 million, respectively in expense associated with the DCP, defined contribution program, as a result of the decline in the performance of deemed participant investments. On a consolidated basis, the cost decrease for the deferred compensation liability is offset by market losses in the related trust asset which is reflected below operating income within other expense.

Excluding foreign exchange impact, salaries and related costs increased $1 million or 1% and $17 million or 8% for the three and nine months ended September 30. As referenced earlier, a large portion of year-to-date increase is attributable to the leadership transition severance costs.

Turning to slide seven. General and administrative expenses increased $300,000 or 1% in the third quarter of 2015 and 4% or $4 million in the year-to-date period.

Excluding foreign exchange impact, general and administrative expenses increased $2 million or 5% during the quarter and $10 million or 9% in the first nine months. The increase in the year-to-date period is entirely due to an increase in other indirect expenses during the second quarter, primarily due to a significant charge related to an unexpected authenticity claim related to property sold several years ago.

Net interest expense for the three and nine months ended September 30, 2015. Net interest expense decreased approximate $1 million when compared to the prior year, almost entirely due to refinancing of the mortgage on Sotheby's York Avenue headquarters in July 2015.

Net interest expense is expected to decrease by approximately $2 million in 2015, when compared to 2014, largely due to this refinancing. Income tax expense.

Management estimates that Sotheby's annual effective income tax rate for 2015, excluding discrete items, will be approximately 36% as compared to its estimate of 38% as of September 30, 2014. The decrease in the estimate of the annual effective income tax rate is primarily due to a reduction in state and local taxes as a result of legislation enacted during the current year and to a lesser extent a change in the jurisdictional mix of Sotheby's pretax income.

A comment on the Taliban sale. Looking ahead to fourth quarter results, we want to highlight to investors that with the Taubman guarantee, Sotheby's is not entitled to receive a commission until aggregate proceeds which is hammer close buyers premium, exceed the amount of the guarantee.

However, the corresponding sales and results and promotional expenses will be reported in both the fourth quarter of 2015 and first quarter 2016 results. Accordingly this will reduce our overall auction commission margin for the fourth quarter and full year 2015.

As we think about the Taubman guarantee, we want to point out that our tally of aggregate proceeds includes the estimated value of items that failed to sell at auction, which are taken into our inventory. This concludes our comments on today's announcements and we will be happy to address your questions.

Hi. Thanks for all the details on the strategy.

Tad, on some of your comments regarding the middle market being more sluggish and macroeconomic uncertainties, I am just curious about what's underpinning those thoughts? And then also, Tad, there were a lot of new comments about how you are thinking over the long haul about talent development.

Just curious about where you see the lowest hanging fruit and how that may impact your financials over time, if you see opportunities in geographies or product areas as you think about talent at large?

With respect to the middle market, it's interesting. I would say this, I think what I said to CNBC the other day, it still holds even sort of week later, 10 days later when the auction began which is, the buyers are getting more discerning.

And frankly when you look at the buyer population at Sotheby's, you really have two tiers and arguably you can even make it three tiers. But we will do two tiers just for the sake of argument.

There is a relatively several hundred, call them, folks who buy stuff that are lot sizes more than $1 million and then there is a much larger group of people that buy smaller lots. So let's break it in these two tiers.

And with respect to the high-end, the folks who are buying things of more than $1 million, that group is getting -- certainly still has plenty of money and it's getting very discerning and quality oriented in their purchases. And you see that reflected I think in some of the auctions, both last night and also last week and also over the past couple of months.

So when I talk about the buyers getting more discerning, but quality still sells and by the way quality sells for enormous prices and sometimes belong to the high estimates, that's the group I am talking about. When you talk about folks that are a much larger pool that are invariably going to be a little bit more sensitive to macroeconomic uncertainties, it's interesting, there is a diversion, if you look at the nine month period through the end of September this year, the focus in the market which I typically define as the middle-market, little bit sluggish and then some lower-priced options generally moving better than we expected.

So that's really what it looks like. It's almost a tiering, if you will.

And I think that that is emblematic of a market that is solid. I think it creates buyers that are discerning, quality oriented, but careful.

I don't know how to say it. With respect to the talent part of your question, Oliver, I think there are real opportunities and I sort of hinted at one just a minute ago when I was talking about the tech space.

I think I did a little segue in there talking about Silicon Valley. I think that's a really interesting area.

I think there is some parts of the Middle East that I think we could do a lot more with. I think there are some parts in Asia that we could some more with.

And there are parts in the United States where I think we could do some more depth and areas where there a lot of untapped opportunities for us. And those are just the ones to come top of mind.

With respect to the talent more generally, we have a really, really talented crowd here and giving each of them pathways to success and also filling out some of the areas where I think I mentioned the Head of the Jewelry Department has got some slots opened just as one example, because if we are really going to grow our branded private sales business, we need some more help there. Little things like that are on the dock and we are making some progress.

Thanks Tad. And just, Patrick, as a quick final follow-up.

The profitable inventory sales: just curious on the magnitude and the details of what was underpinning that driver in the margin? Thank you.

Sure. The biggest item in that was what we talked about on the last earnings call, which is in the second quarter, we had acquired two pieces of inventory, both of which we sold at auction.

One was profitable. One was not.

And we actually put out an 8-K that the profitable one sold in the third quarter. And so that's the biggest driver of what's going on in the inventory line.

Okay. Thanks a lot.

Best regards.

Thanks, Oliver.

Hi guys. Good morning.

Hi Taposh.

How are you? Tad, I just have a follow-up on the Taubman sale.

So you said a couple of times that you expect to cover the amount of the guarantee. Can you further elaborate?

Is that including or excluding the buyer's premium? And can you let us know if you expect to make or lose money on it?

Patrick, you want to take that one?

Sure. So the way to think about it, yes, whatever happens in the room in terms of hammer and then buyer's premium all counts towards covering the guarantee.

So far we have had aggregate proceeds of about $420 million and then to be sold property. If you look at the low estimate needs to assume what the buyer's premium would be, that probably gets you close to another $60 million and then the balance to get to the total guarantee amount is any property that we bought in and then we have to mark that to market and include it in our balance sheet.

When you add up those three buckets, what aggregate proceeds so far, anticipated aggregate proceeds from items that's stored to be sold and then the limited number of items that are on our balance sheet, in the aggregate right now we believe that those will allow us to cover the guarantee.

You want to make a comment about things on the balance sheet and how it's progressed since the last week?

Sure. So as oftentimes happens in auctions, things that failed to sell in the auction themselves, we get approached by buyers shortly after the auction.

And we have already sold a handful of items and we have actually sold those at prices that we found attractive relative to where we would have put those items on our balance sheet and some of them are meaningful from the Masterworks sale. So we have some good progress in terms of selling on a post auction basis.

Great. And can you comment to the degree that you care to, on the profitability of that sale?

Well, it's premature. So we have commented so far is that we think the proceeds will be adequate to cover the guarantee.

We won't be in a position to earn revenues until the aggregate proceed is delivered equal to guarantee. And so it really depends on what happens with the upcoming sales, the scheduled auctions and also ongoing progress we make on selling items out of inventory.

So until we actually get through that, it's beyond saying that we believe we will cover the guarantee, it's hard to give you more clarity.

Great. And then just a higher-level question there.

It seems that there are a lot of moving parts this year around the Taubman sale, your strategic initiatives, capital allocation, et cetera, so just a high-level question on earnings growth. Operating income was up last year, it's down about 4% year-to-date.

Do you think operating income is a fair metric to be evaluating this company on? Do you think it's a realistic expectation in this environment?

And outside of operating income growth, what other metric should we be looking at in the near to medium term as we evaluate the company?

Sure. On operating income, yes, we absolutely believe that operating income is an appropriate metric.

We are going through some pretty important transitions around here, starting with the transition of the Board in 2014, transition in CEO in 2015. As Tad mentioned, that has led to a transition in the senior leadership team and so we have got a bunch of new folks with new ideas.

And so all that means that how we are thinking about our strategy and how we are thinking about executing that strategy is going through a pretty thorough review. That makes it more difficult to give a lot of precision around how we are thinking about the cost side of the business.

And that's why we have suspended cost guidance this year. As Tad described, we are going through our planning process for next year.

And we will bring that to the Board in December. And so I think we will have more clarity as we head into the end of year.

But having said that, we have got a lot of really interesting things going on. And so I do think we will continue to be in a bit of a transitionary period where in some cases we will be taken cost out as a result of these changes and in others we will be making investments to drive the brand and to drive growth and so we are in a period where its going to hard for us to give real precision on some of these cost items, but as we work through it, clear the goal and the outcome that needs to be driving increased operating profit.

Exactly, I couldn't agree more. Patrick, I would just say, I think Patrick and I both are keen to restore some visibility in guidance on expense assumed next year as we can.

Fantastic. Best of luck.

Thank you.

Hi. Thanks for taking my question.

And congrats on the post-auction sales and thanks again for the framework update, the strategic framework. Could you talk about the demand side of the financial services piece of the business?

How do you see that scaling over the next year or two? And how should we think about seasonality impact to that business?

Sure. It's Patrick.

I will take that. On the demand side, what we have seen so far, we have had an increase in the number of loans and importantly, we have also had an increase in share of wallet.

So increased the loans with existing clients and so that's through driven a lot of growth over the last couple of years. What we have done in 2015, is we built out the team a bit.

We have added dedicated sales resources here in New York and also in London and we have also added some senior transaction resources, the people who actually negotiate the deals and do the underwriting. And so our plan, on a go forward basis, is really to try to drive increased loan count.

And that may mean that we are doing loans of smaller value, but we think it's important to have more breadth in the portfolio. And the process is really to get our new dedicated sales resources in front of our existing clients on the art side.

We have got great relationships. We have great relationship managers on the art side.

And the question is, how can we add more value for those clients through the financial services product. It's a niche business and so it's hard to give you a real sense of how much more we think we can grown and how quickly.

But we do think we have got a great product and a plan in place with these sales resources that we should be able to continue to drive growth.

Great. Just wanted to go back and clarify one of Tad's comments.

Tad, so it's fair to expect in the first six months of next year an update? And it sounded primarily centered on the real estate side on London and New York?

Is that right?

Well, I think I spoke of that comment specifically on New York. And I think the other thing I said and I will try to say it very clearly, we are no rush because we own the building.

We have no pressure to decide at all. And the reason I am being a little bit careful about that, I don't want to box ourselves in.

We are no hurry. It behooves us to move it along and we will and I expect that we would like to get this one way or other, settled and resolved.

I mean just the personal experience of putting 11,000 people through the building last week and the elevator waits and some other things and also just walking around the building, if we stay and do some improvements on the building, honestly all of us would like to get on about it. And if we are not going to do that then I think we would like to get on about that decision too.

So we are motivated to move it along.

Understood. Very helpful.

Thanks.

Hi guys. Good morning.

This is Jason, on for George. Wondering if you can maybe give us some updates.

Last quarter we talked about your focus on pricing excellence and some different initiatives to change pricing. If you had any updates there?

Or if you have rolled anything out during the quarter, that would be helpful? Thank you.

Yes, we did. We do have a new pricing that's rolled out.

When I say new pricing, there are two ways. One you could think about the commission structure which we have not changed.

And two, you could think about things like how we apply and set approvals for discounts and I think that's already been implemented, both here in the Americas and also in Europe and the two managing directors are now managing to it. In terms of other sort of nuances, little things like we now have, before we approach a specific client with a consignment, they all coordinate now with the Head of Worldwide Transaction Support.

So we have some basic things that are going into place, but gently.

Okay. Great.

Thank you.

Good morning. First, can you talk about what you are seeing in terms of price inflation in the market?

And is that one of the reasons the bidders are becoming more discerning on their purchases?

Yes. It's a really interesting question and it's hard to talk about average price because that's not what's happening, honestly, in the auction room.

What you are seeing is the prices of very high quality objects are going very strongly against the estimates and the prices of everything else are soft. But that the trick with that is that relative to the estimates or is it relative to the same item when it came up before.

And the reason I make that distinction is important because one thing that's going on here is, of course, a consignor sees pieces going for eye-popping numbers in the auction room and the consignor's expectation about what it's worth goes up. So the estimates then go up and so vis-à-vis the estimate, if it doesn't performing as the estimate, it's not clear that the value of the item didn't appreciate considerably, it just maybe it didn't appreciate vis-à-vis the actual estimate price that we guaranteed or didn't guaranteed and consigned it to go into the auction room.

So it's a little tricky to guess. And the data itself, if you actually look on a item by item basis, I haven't looked in a number of months on that particular stat, but if you look at the top 20 items, plus or minus, there are some that are going up sharply on a compounded annual rate and there is some that are soft to it.

So my general view is that the consignor's expectations about estimates are robots and what that means is, there really needs to be a significant bit of quality in the item in order for it to go well above the estimate in the auction room. And there are a lot of things that don't achieve that but on balance, it's ending where the sales are strong at the top line, even though there is a skew of results underneath it.

Okay. Thanks for the color.

I appreciate that. And then can you talk about the jewelry category?

What's going on in that category? Why has it been sluggish over the past several quarters?

Yes. With respect to jewelry, there is some general softness in stones and I think there is some general softness in particular areas, Asia clearly is area that's on my mind and I think we are going to learn a lot more about how Geneva does this week.

So I am reasonably cautious on the jewelry category for us in the very near term overall, but optimistic about our potential opportunities in further expanding private branded jewelry sales.

Okay. So it sounds like it's more of an overall category issue and not Sotheby's specific?

Is that correct?

I am not sure I would say that either. What I would say is that we have opportunities to improve in jewelry.

I think in specific areas over the past seven months, I think we didn't do as well as we could have. And I think there is some opportunity to improve there.

And at the same time, I also think that there are some headwinds facing some parts of the jewelry business. And I think we are reasonably optimistic about the future for it.

Okay. And then just lastly, Patrick, did you buy back shares in Q3?

We did. In August, we announced that we had entered into an accelerated stock repurchase program and that went on throughout the -- it's actually still going on.

So we launched that in August and it will likely close before the end of the year.

Okay. And how many have you bought back?

How many did you buy back in Q3 in shares?

Well, we haven't disclosed the full count yet because the program is not over yet.

Okay. Got it.

Okay. Thank you.

Hi. Good morning, everyone.

Hi Mark.

I just wanted to go into a little bit of the supply side of art and collectibles for a moment. Given the amount of macroeconomic volatility we have seen over the last several months around the world, I was wondering if you could sort of give us a little bit of an update or sort of your views on what types of events may or may not have provided additional supply?

Because given whether it's currency related or just global macroeconomic concerns or what have you, there's always the question of what motivates somebody to sell a work of art? So I was wondering if you could give little bit of thoughts as to what you have seen over the last several months, especially with everything that's taking place around the world, whether or not, may be in your views, that might have shaken loose some additional supply and what maybe we can utilize as a marker for going forward?

Thanks.

Well, it's anecdotal, but clearly we talk to a lot of people in the marketplace and I would say that beginning over the summer, there was a great deal of media attention on some of the macroeconomic volatility in the equity markets and also the changing situation in China. And it's fair to say that many of the dealers told me that the summer for them was quiet.

Now the reason I focus on the dealers for just a minute, business really starting in roughly July, I think it's July 8 with our last big sale, if I am not mistaken and then throughout the summer, we really didn't have an indicator of any size until we got into the Hong Kong sales and then the London sales. So during that period, anecdotally, it seems like it was relatively quiet.

However, it was a fascinating paradox because although it's quiet in terms of the sales there was clearly a fair bit of supply coming on to the market and not just by the way at this house and not just the Alfred Taubman collection. You can look around and see, there is a fair bit of supply that would have been in some state of consignment beginning in the second week of August, all the way through September, which is really when it was being consigned.

So at the same time, you could step back and say, the expectations for that supply on the part of consignors were reasonably high and I would say that in light of the noise, macroeconomic uncertainty in the marketplace, their insistence on guarantees was unusually higher in my two seasons of experience. But at the same time, if you had a trophy lot and you saw this also in our sales, a big trophy lot where you have a lot of confidence, typically preferred to not take a guarantee.

Because you feel very confident about the lot and you prefer to get more profit, if you are a consignor. And so that's largely what we have seen.

We don't seem yet to be having a broad-based issue with getting supply. My colleagues in Asia told me that there was little bit of sluggishness, if you will, on the part of consignors, a little bit of wait and see, earlier in the year and I think you will probably see that some more.

Just got another example this morning where there is a very interesting potential hedge partner, if you will, that wants to wait and see how things go this week. And so anecdotally, you have got a little bit of wait and see.

On the other hand, if you just step back and let the magnitude of the supply of the art that came on last week and this week, it's huge. So mixed signals again to what we have been saying.

I will stop there.

I appreciate the color. Thank you very much.

If I could just go back to Kristine's question and I think I was answering a question on where things stand on the stock buyback, but your questing was just what happened in the third quarter. In the third quarter, the initial purchase of shares was 2.7 million shares.

I just want to thank all of the Sotheby's team for doing such a great job and I particularly want to thank my colleague, Patrick, who by the way has done a phenomenal job during the quarter, where he was both managing the CFO role with great aplomb and also provided a tremendous leadership role on the Taubman. Thanks.

So thank you all.