Great. Thank you, Michelle.

Good morning and thank you for joining us today. With me on this call are Tad Smith, Sotheby's President and Chief Executive Officer; and Mike Goss, 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 reconciliations to the comparable GAAP amounts are provided in an appendix to the fourth quarter 2017 earnings release, as well as the company's Form 10-Q for the period ended December 31, 2017. 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 a 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-K and Form 10-Q.

These documents identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statement. Also, please see our Investor web page for a transcript of our prepared remarks.

Now I'll turn the call over to Tad.

Thank you for joining us this morning. We had a very good year in 2017 and are planning to have an even better one in 2018.

The 1937 Picasso we sold for $70 million in London last night is certainly a pleasing indicator for the year ahead. Today, we are reporting 2017 earnings per share of $2.20 compared to $1.27 in the prior period, a 73% increase.

After excluding certain charges in both periods, adjusted diluted earnings per share improved 32% from $1.71 to $2.25. For the fourth quarter, diluted earnings per share is $1.43 compared to $1.20 in the prior period, a 19% improvement.

After excluding certain charges in both periods, adjusted diluted earnings per share increased 9% to $1.47 from $1.35 one year ago. You may recall a change in our sales schedule that resulted in $82 million in net auction sales from our autumn Hong Kong sales series falling in the third quarter of 2017, which may have reduced our fourth quarter results by as much as $0.15 per share.

Three years in, we thought to look back on 2017, remind our stakeholders of our four key priorities, describe progress against them and where we're headed in the future. I will close with an outlook for 2018 before turning it over to Mike Goss for a review of the financials.

Our business achieved many milestones in 2017. We set new records for any diamond or jewel, with the CTF Pink at $71.2 million, and Chinese ceramic, with the rare Ru brush washer for $37.7 million.

We opened beautiful new premises in Geneva, where we also celebrated our 40th anniversary, and Dubai, where we also held our first auction. We also celebrated 100 years on New Bond Street in London and 10 years in Moscow.

Our March Impressionist and Modern Sale set a new record for any auction ever held in London with a total of $240.8 million. And in November, we broke a 27-year-old record for Marc Chagall with a painting that had remained in the same collection for 90 years and sold for $28.5 million.

We captured the world's attention in May when Jean-Michel Basquiat's 1982 masterpiece set a new world auction record for any work by an American artist, selling for $110.5 million to the Japanese collector Yusaku Maezawa. And for those of you in New York, I encourage you to visit the Brooklyn Museum to see the painting, where it is on loan until March 11.

We set new records for an English car with a spectacular 1956 Austin Martin selling for $22.6 million and an English watch, with George Daniel's legendary Space Travellers' watch for $4.3 million. Our Old Master team successfully brought to auction a number of rediscovered masterworks by artists including Sir Peter Paul Rubens and Joseph Wright of Derby and sold a major work by Parmigianino to the J.

Paul Getty Museum privately. Our traditional sales of African and Oceanic art saw a new auction record set for any Easter Island work at $4.6 million and outstanding results of $7.1 million achieved for the stunning silver collection.

And we held our inaugural sale of Modern and Contemporary African art, setting a new record for an auction in the category with a total of $3.6 million. We presented the collection of celebrated French interior designer Jaques Grange, which far exceeded our high estimates, with a total of $33.3 million, and set a new record for a single-owner sale at Sotheby's in Paris.

Finally, the outstanding total of $26.4 million for our December 20th Century design sales in New York was more than double that of our competitors combined. While strong, the sales achievements are only part of the story.

Our operational statistics for the full year 2017 show that we are growing and thriving. Our consolidated sales grew 12% in 2017, with 18% growth in the fourth quarter.

Note that the following statistics include auction and private sales, but exclude wine. Test.

For those of you on the call, we're getting feedback here, so we're going to double check the connection and be right with you. [indiscernible] We were having a feedback.

So I'll continue. I said one second ago, just to tell you where we left off, I said note that the following statistics include auction and private sales, but exclude wine.

And thank you all, investors and analysts, for being patient. We conducted more than 300 auctions and offered more than 50,000 items for a sale, a 6% increase over 2016.

Our sell-through rate improved by 2 points over 2016 to 80%, with the increase occurring across each of our major categories. The average value of a lot rose 5%.

But the crucial metric of hammer price versus low estimate soared 8 points to 110% versus 2016. We were also pleased to see that the core of the middle market, lots between $100,000 and $1 million, which is approximately 9% of our lots and 27% of our sales, grew 4% in lot terms and 9% in value terms in that very profitable category.

The number of our transacting clients rose 10%, with the sellers up 6%, buyers up 13% and bidders up 11%. First-time bidders were also up 7%.

Even without a team in place for the full year or the implementation of our new tools, private sales grew 28% in 2017 to $744.6 million, the best performance in 4 years. Thank you to my colleagues for their successful work.

Turning to 2018, let's revisit our four key priorities and review progress against them. As a reminder, the four priorities are as follows: to develop and implement a compelling growth strategy, to embrace technology and increase the pace of our company's innovation, to allocate capital wisely and efficiently, to create a winning team that sustains the other three priorities.

Our strategic ambition is that Sotheby's be the best choice for clients to discover, buy and sell the world's treasures. How are we doing?

Three years ago, we set out to re-establish ourselves as the best place to discover, buy and sell fine art, and I believe that we've delivered on that objective. Crucially, Sotheby's strategy is not to be the biggest market share player, although many times it turns out that we do have the largest sales, nor to be the cheap, consignment deal.

Instead, we aim to be the best choice for those clients who care about service excellence and overall financial performance and then to deliver that performance over and over again. Another strategy we had in early 2015 was to deepen and broaden our focus geographically around the world to be closer to those clients who could benefit from Sotheby's.

We made good progress in East Asia, South Asia, the Middle East, South America and the West Coast and the south-eastern tip of the United States, and that progress continues. Not all of these regions is created equal and not only because our largest shareholder happens to be Chinese.

Due to its size, wealth, influence and future prospects, China in particular has been an area of our significant focus in the past 3 years. That is why we are so proud that our East Asia operation led all international auction houses in 2017 with its Hong Kong sales.

Another strategy we had in early 2015 was to grow our market share of worldwide private sales, and the results we mentioned earlier show good progress with more to come in 2018. Three years ago, we had a strategy to boost our sales within the middle market, which is defined as lots sold at prices between $25,000 and $1 million.

The middle market includes our crucially important Day Sale material and our very profitable smaller art and objects sales held in New York, London, Paris and Hong Kong. Helped by our strong online sales, superb management within the departments and an improving art market, our Day Sale activity rebounded strongly in 2017, especially in Contemporary Art.

More will come in 2018. In 2015, we had a strategy to grow our jewelry and watches business, particularly through continued good work on auctions supplemented by more attention to our various private selling activities.

Our jewelry position in 2017 was so strong that we found ourselves in the peculiar position where we and one other issued duel press [ph] releases claiming to be number 1. We also welcomed a new Managing Director of Global Watches and Jewelry who joined us February 5 based in New York, as well as a new Head of Watches based in Hong Kong.

Our Wine business is another area of opportunity. Extremely well managed globally in the auction space, our wine auction sales are off to a strong start in 2018.

In late January, we held a sale in Hong Kong that totaled $6.1 million, with a 98% to sell-through rate, and set a new auction record for a single bottle of Japanese whiskey. At the end of this month in Hong Kong, we will represent an anonymous Asian collector in what could be our largest-ever single-owner wine sale in Asia, 800 lots of wine valued at approximately $7.7 million.

Spurred by our new wine retail website on our own platform, we expect strong growth in retail sales in 2018. Our Sotheby's Financial Services business has exciting strategic expansion opportunities.

SFS has grown to a large and robust independently financed business through the end of 2017. Turning to the future, SFS will evolve to extend its benefits to our consignors, our irrevocable bidders and other clients in our existing ecosystem by enhancing our access, affordability and speed.

Look for plenty of service, innovation and growth in 2018 and beyond. Following our acquisition of Art Agency, Partners in early 2016, the global platform of Sotheby's has provided a powerful foundation for our advisory business.

We have many clients that are new to us and at the same time provided opportunities for us to deepen relationships with existing clients, who are well managed by our team of specialists and client relationship managers. We've seen increased activity by many of our advisory clients in our auction rooms globally, both on the consignment and buyer side.

And early last year, we launched an entirely new branch of services for artists and artists' estates. This new artist advisory business has grown more rapidly than we anticipated, now with 13 clients and a number in contract.

We've also begun working with a number of clients who are building private museums, presenting us with yet another avenue for growth. Number two, nearly all of our strategies employ the application of technology and much more rapid innovation.

For example, we have working mobile applications across all operating systems, and mobile bidding will be rolled out beginning in this year. Last year, we held 36 online-only sales, more than double the previous year.

Our social media program leads the market and is growing in terms of reach and engagement each week. Video has become a cornerstone of our marketing program.

Before it was fashionable, we acquired Mei Moses and turned our focus to collecting and using data analytics to address our clients' needs. Our lead has accelerated with the recent acquisition of the artificial intelligence company Thread Genius.

We bought a scientific testing company that reviewed over hundreds of objects last year and potentially saved the company millions in potential losses [indiscernible] identification of problematic works of art. Our progress on the middle market will be further strengthened with the new, low-touch and scalable web-based company called Viyet that we acquired a few weeks ago.

And the results of this multiyear effort are already benefiting 2018. As of mid-February, 35% of our lots were sold to online buyers, up from 23% for the full year 2017.

The number of online bidders this year has jumped 107% versus the same period last year, and the volume of under bidding online, which exceeded $0.5 billion, with a B, last year, is trending 114% higher thus far this year. And we are not only selling things online.

Now, we are bringing in consignments online, and this is a powerful emerging tool for future growth. What to look forward to in 2018?

More rollouts on Sotheby's new tech platform together with more innovation for clients in affordability, speed, access and usability. Number three, our capital has been allocated very effectively since 2015.

Three years ago, our balance sheet carried over $200 million worth of inventory that has been significantly reduced to $74 million today, with another $33 million in reductions expected in the first half of 2018. We have refinanced our debt, raising an extra $100 million to invest in our business.

We have bolted on some acquisitions to add capabilities and services to our repertoire so that we may compete more effectively. We've announced enhancements to the gallery spaces in New York, London and Paris, and we expect to invest approximately $60 million on this program to create new, state-of-the-art galleries as well as new public and private exhibition spaces.

We have repurchased 26% of our shares since mid-2015 and sharply increased our return on equity for investors. The good news is that despite all of our previous and planned short-term investments, we once again have capital substantially in excess of that needed for our existing business operations.

While we will certainly keep our eyes open for the right acquisition, our bias continues to be to repurchase shares. Number four, Sotheby's has three assets: superior team, great brand and plentiful capital.

But the most important one by far is our superior team. A lot of work has been done over the past few years to build and strategically align the team that we have now, and I believe that we have the best team in the industry.

Let me close by saying that investors should be very pleased to hear that our pipelines are filling up, the prospects for the spring are bright and the team is very optimistic about 2018. I will now turn it over to my colleague Mike to go through our financials.

Thank you, Tad. Before turning over the mic to all of you for your questions, I'd like to address four broad topics: first, the financial highlights of the fourth quarter and full year; second, the impact of tax reform on our financials and, in particular, how tax reform will impact our tax rate going forward; three, how we are managing our balance sheet and the allocation of capital; and four, given all of the above, our thoughts for the year ahead.

Starting with our first topic, the financial highlights for the fourth quarter and full year, we exited the year with a stronger market environment than we experienced at any time in 2016 or even the first half of 2017, and this strength translated into higher net sales and revenue for Sotheby's. Our net auction sales grew by 13% in the fourth quarter of 2017 versus the same period in 2016.

However, given how this year's Hong Kong sales straddled the third and fourth quarters, it may be more meaningful to look at the trailing 6-month period, where you will see 20% year-over-year growth in net auction sales. Our private sales showed similar strength as we exited 2017.

They were up 61% in the fourth quarter and up 23% for the second half. In terms of profitability, the themes we've communicated on prior calls throughout the year continue to hold true, namely, our auction commission margin for 2017 stabilized versus 2016 at 17.2%.

This is something we've been anticipating due to better deal making against a greater mix of higher-priced items where auction commission margins are lower in percentage terms. Secondly, our adjusted expenses were higher than last year by 14%, driven primarily by two factors.

One, higher incentive compensation after significant reductions in incentive compensation were made in 2016. This increase also includes private sales incentives driven by our higher private sales levels.

And two, greater investments in our digital efforts that will drive our growth and lower our costs in the future. With the progress in our digital business that Tad spoke to earlier, we're more confident than ever that the investments we're making in marketing and technology will pay healthy dividends in the future, both through higher growth and lower costs.

Finally, due to a one-time $0.13 per share tax benefit in the third quarter; a modest deleveraging of our balance sheet, as I will discuss further in a few minutes; and a lower number of shares outstanding due to our ongoing share repurchase program, we reported adjusted EPS for the year of $2.25, a 32% improvement in adjusted EPS on a 5% improvement in our adjusted operating income. Now, for tax reform, as with all other U.S.-based companies, our financial statements include the impact of the recently enacted tax reform legislation.

However, the net impact is very small in our case. The footnotes in our 10-K will give you all kinds of detail, but here's how we end up with a very small net impact.

First, we have a $20 million noncash charge to write down the value of our deferred tax assets following the reduction of our U.S. corporate income tax rate from 35% to 21% and the potential limitation of future business deductions.

Second, we have a $59 million noncash benefit to reverse previous tax liabilities recorded on foreign income that we intended to bring back to the United States at some point. And third, we recorded a $40 million liability for the one-time transition tax required for unremitted and untaxed earnings of our foreign subsidiaries.

This tax will be paid in cash over the next 8 years. Finally, I should add, knowing the tax reform and a potentially lower tax rate was on the horizon, we had carefully managed the timing of any repatriation of foreign cash in recent years, which ultimately resulted in substantial savings on our tax bill.

The net result of these three items is a provisional $1.2 million charge included on the face of our income statement within our general income tax expense line and excluded from the calculation of adjusted EPS. The much more interesting part of tax reform for Sotheby's pertains to our plans for the previously unrepatriated cash we were holding abroad and our ongoing effective tax rate against our future earnings.

First, with respect to the repatriation of cash, we will be bringing in the range of $325 million of cash back from our overseas operations at a significantly lower tax rate than we had previously planned. When I discuss our thinking on capital allocation in a few moments, you will hear how we are planning to use these funds.

Second, with respect to our ongoing tax rate, we expect to benefit from the widely publicized reduction in rate from 35% to 21%, but the impact will be muted by the fact that we are a global company with significant earnings outside of the United States. Net-net, we are encouraging investors to think of our effective tax rate for 2018 in the 27% range before giving effect to positive or negative discrete items that come up periodically.

Of course, this rate is still dependent on the mix of our earnings among our global businesses, and we are still waiting on further guidance to be issued by the IRS and state taxing authorities. Capital allocation: as Tad mentioned earlier, implementing a more efficient capital allocation philosophy has been and continues to be a key priority for the company.

To that end, we have made great strides in liquidating excess inventory, being more prudent in writing unhedged guarantees, more tightly managing mismatched terms between consignors and buyers and freeing up excess cash balances for either debt reduction or share buybacks. We also took advantage of a strong bond market in December when we opportunistically refinanced $300 million of senior notes due in 2022, bearing interest at 5.25%, with $400 million in new notes due in 2025, bearing a rate of 4 7/8%.

Given the rise in rates since that date and projections for further increases in the near future, that decision is looking good. In 2017, we modified our strategy with respect to the use of short-term balances of idle cash.

In the years since raising a separate revolving credit facility to finance our loan business at Sotheby's Financial Services, we have always kept large cash balances generated by our agency business while simultaneously carrying outstanding debt on the revolving credit facility we use to finance our loan business. We did this in order to demonstrate a high return on equity at SFS, even though we incurred a negative spread between interest income we earned on our cash balances and the interest we paid on our outstanding debt.

In our view, it made no real economic sense to Sotheby's shareholders for us to continue this practice. Starting in September, we began applying our excess cash balances to our SFS debt, thus eliminating the negative spread on that amount of cash.

Once we have a more meaningful long-term use for that capital, say, for stock buybacks and acquisition or capital projects, we can always reborrow that money on our credit line at that time. In fact, we currently only have $65 million outstanding on our line of credit, even though we have a borrowing base that supports $450 million in borrowing.

So where do we stand at present in terms of excess capital? By our estimation, after our typical allocations for business-getting needs, downside protection and the 2018 capital spending projects, we currently have as much as $325 million in excess capital available to us, largely in the form of undrawn credit against the SFS loan book.

This amount includes the $96 million still remaining on our previously announced share repurchase authorization. And yesterday, our board of directors approved another $100 million increase to our share repurchase authorization, resulting in an updated share repurchase authorization of $196 million as of today.

The outlook for 2018: we had a good year from both a strategic and financial point of view in 2017. Our markets stabilized and then strengthened as the year proceeded.

We made great strides against our key growth strategies, and we exited the year with a strong balance sheet flush with available capital. We are pleased that 2017 played out on the bottom line as we had expected.

In 2018, we expect little change to this upward sloping trajectory. We intend to stay the course and continue what we're doing, both strategically and financially.

That means continued attention to our base auction business as well as to private sales; continued diligence on our deal making and guarantee writing; continued investing in our digital future, from both an operating expense and capital expenditure point of view; and continued focus on generating excess cash for use in opportunistically buying back stock based on our market conditions and/or deleveraging our balance sheet. Given the traditional, limited visibility in the art market and the recent increase in volatility in global financial markets, we are going to wait and see before confidently predicting a repeat of the last 6 months' growth rate, but we do feel good heading into the year as far as the pipeline is concerned.

From an earnings point of view, the themes outlined at the top of my comments remain relevant, which is to say we expect a stronger art market that will aid our top line and we will continue investing in our technology and marketing programs to drive our future growth higher and our cost structure lower. The net result is that we think current consensus expectations should remain where they are until we see how things go in the next quarter, with the possible exception of an upward adjustment justified by the impact of tax reform on our effective tax rate.

So let's now turn over the mic to you for your questions.

Hi, great quarter.

Hi, Oliver.

Good morning, Tad. Regarding this time around with volatility in the marketplace, it feels different.

What are your thoughts on how this may play out with the consumer confidence? Because a lot of the consumer metrics are very strong, but we've had some interesting volatility.

And you did mention you feel good as far as the pipeline is concerned. Would love your thoughts on what's informing that.

Yes. Good questions all.

So just as a couple of quick context-setting comments, as you all know, debt, divorce and death generally are the core, arguably the secular, drivers of supply in the market, with discretion, meaning a person's desire to raise cash for none of the prior reasons I mentioned, as a key swing factor. And if you think about that, estates and marital situations and also debt are relatively unaffected - well, debt a little bit less so - but the first two are largely secular trends that are unaffected by the underlying macroeconomic environment.

And so when estates come up, they come up. When, unfortunately, marriages have their problems, they have their problems.

So that is a general, underlying level of supply, and that is uncorrelated to marketplace conditions. Debt, you could argue, is more correlated to some financial volatility, but not perfectly correlated with it in some instances.

And by the way, the financial volatility is largely, at least, in the Americas, and you could have people that need to sell for debt reasons all around the world. With respect to the fourth one, which is discretion, the financial volatility is a really interesting thing, but the thing to remember is that financial volatility is not so much an influencer on the demand side for us.

The key thing that drives our business is actually not so much demand. Its supply and the discretionary supply particularly, other than estates.

And what I mean by that, it's a person who is thinking about selling a painting, but is concerned about whether it will sell. So it's almost a metalevel question on the financial instability.

So a person who has a painting, doesn't have to sell it now, has the ability to sell it a year from now or 2 years from now, isn't in a rush, looks into the marketplace and tries to ascertain whether now is a good time to sell. Well, we can give them insight on whether it's a good time to sell, but they could also turn on CNBC and see red tickers and be concerned about it.

At the moment, we're seeing a nice pipeline for the spring. We're feeling good about things, and I think I said in the press release we're planning to have an even better year in 2018, which means our budget, our plan is planning to have a better one.

It's true that a black swan event could affect that, but that's true of - that's always true of us. That's always true of every stock.

And so we feel really good about it, Oliver. We thought long and hard about our plan, which we reviewed with the board yesterday.

We thought long and hard about our positioning with the market, and honestly, we're feeling very good.

Okay, Tad, that's very helpful. And our last question is about the middle market and the intersection of the middle market with technology and affordability, and as you balance the brand and how you brought in it appropriately.

What inning are you on, and how will different digital tools, as well as thinking about handling over the long term, counterbalance this in terms of making sure you do this in a profitable, brand-appropriate manner and also harness M&A and technology as well?

Yes. Well, you've got several wonderful questions in there.

Let me deal first with - I'm going to switch sports metaphors on you from baseball to something else. In the last sort of 4 to 6 weeks, when I'm asked about what inning we're in, I've actually switched to a marathon.

We're really on mile 7 of the marathon, but the good news is, in my mind, we're picking up speed and noticeably picking up speed. And what I like about that is we've got so much opportunity in front of us and we can see it, but the rate of our innovation is beginning to accelerate and also the capabilities in the team are beginning to click in really, really nice ways.

So I'm expecting better and faster returns going forward in the future and beginning in 2018, as I think I've hinted at multiple points throughout my script. With respect to the brand, we have an incredible - in fact, I think I said the three great things we have our team, brand and plentiful capital.

Brand is right smack up there with team at the top of that list, and we are incredibly careful about the brand. If we're going to be doing areas which are not consistent with the brand, first of all, we think long and hard about it, and we choose generally not to do them.

Or if we have experiments that we're trying - such as even before I arrived with eBay or something like that, or more recently we don't have an experiment, we actually have a new acquisition in a new category called Viyet - it will be operating under the Viyet brand. We're pretty excited about the various opportunities here, and I said we're sort of mile 7 and picking up speed.

Great. Excited about the marathon.

Thank you best regards.

Thanks, Oliver.

Good morning. Thanks for taking the questions.

Hi, Daniel.

Tad, Mike, the adjusted expense is up about 14% last year. How should we think about that type of growth in 2018?

And given the strength that you're seeing potentially in the market, are there any discretionary investments that you may be considering that perhaps you wouldn't have a year ago?

Well, that's certainly a question we consider all day long. Yes, you are right.

We were up 14% for the year in adjusted expenses. I would point out that for the fourth quarter, we were up only 8%.

So the rate of increase is starting to moderate already, and I think in 2018, you're going to see increases more like 8% than 14%, as we have replenished what we needed to do after declines in 2015 on the compensation side. It's a little bit more stabilized now in 2018.

We continue to plan to continue to aggressively grow our digital activities and our marketing activities, but we won't need to increase at the rate that we did in '17.

Got it. And obviously, Tad, you've indicated that sellers are starting to come back to the market feeling good about things outside of modern and contemporary.

In the last couple of weeks, months, any specific categories that you're really seeing coming back?

Well, it's interesting. Old Masters had a robust sale in January.

And interesting when you look at the five-year look at Old Masters, that is an amazing business that just keeps delivering good, strong, predictable sales and predictable cash flow, and that's just one example. But I think I talked in the earnings script about design and a number of other things, and it's important to say when you say about people coming back to the marketplace, I would argue that much of 2017 they were there, and certainly the second half, it was very strong in terms of the sales results that Mike was talking about.

So I actually think the market is quite strong right now, and we feel really good about it. I think Oliver's question a minute ago really goes to, given some of the twitchy-ness in the underlying equity markets, will it continue?

And at the moment, we're not seeing any concerns there.

Very helpful. Lastly, and I'll jump out.

From a modeling perspective, the Hong Kong series, do we move back into Q4 in '18 and just more broadly any other major shifts in the calendar we should be thinking about?

Well, we haven't set the date for Hong Kong yet in the fourth quarter, so we don't really know just yet. We do know that in the first quarter of this year, we will have some Hong Kong sales in it, and so that'll change the first quarter to the better, so we know that's going on.

Don't know yet the third and fourth quarter.

Helpful. Appreciate it.

Congrats again on a good quarter, nice finish to ;17.

Thank you, Dan.

Hi, good morning.

Hi, David.

Really two questions. The first one, it feels - I had it all on - I was going to use inning analogies or maybe quarters in the NBA and now you're in the marathon, so it's totally screwed up my thinking.

I like the NBA. You can go there if you want.

Okay. Good, so middle of the second quarter - So let's talk about these pieces you've put together: technology, private sales focus, new people around the organization, some new processes.

It feels in the narrative, both the numbers you're printing and then the narrative that you're discussing here, Tad, that you're confident. Your growth and your confidence is getting a little bit more driven by company-specific initiatives than in the past.

So I want to check that with you and relate that to your - again, it was going to be the third inning or the middle of the second quarter, but I guess we'll go with mile 7. Is it fair to say that we're at a kick point, I guess, is the first question, where company-specific initiatives are driving more of your business and confidence than they have over the last couple years?

That's question one. Question two, realizing your customers and even the auctions themselves are global, global with live and global with currencies going all the time, but could you talk about geographic shifts in sort of art market energy?

With respect to number one, absolutely 100%, yes. Period.

With respect to your second question, China continues to do well, the Americans are buying in force, and there's some interesting patterns of enthusiasm in Central Asia and the Middle East.

Thank you very much.

Hi, thanks a lot guys. This is Wescott Rochette in for Omar.

I guess the first question would be on your private sales. I know it's a huge initiative for you.

Fell off a little last quarter, but on the baseline for the year continues to be very strong. How should we think about or how are you thinking about private sales as either a mix of your business, the emphasis you're going to place on it going forward versus your regular auctions, how it interplays with your auction strength and whether that business is building more off - taking away from existing dealer relationships or how you think about where that business book is growing?

Yes, Wescott, before Tad answers the substance of your question, it sounded to us that you suggested that fourth quarter private sales were off. That is not the case.

In fact, for the fourth quarter, they were up 61%, so I just wanted to -

Sorry. I meant for the third quarter, they were off, but they rebounded significantly for the fourth quarter, so the year continued the strength.

Yes. Just so everyone understands, up 28% for the year, up 61% in the fourth quarter, up 23% for the second half.

So now I'm going to turn it back. Now that I've iced the puck a little bit, using another sports analogy, I'm going to let Tad answer.

It sounds like a Madison Square Garden earnings call. Well, I think it's probably worth noting that there were four things that need to happen for private sales to really, really kick in, and then I'll turn to the market part of your comment.

Number one, you needed to have a leadership team that took it on with great enthusiasm. Number two, you needed to have people that are both focused and enthusiastic about it.

Number three, you need to have communication processes and compensation processes that will induce that behavior. And number four, you need to have a set of tools that make it easy to be able to identify and manage opportunities.

So really you could think of those four different things as various elements of it. I think we are in good shape on numbers one and two, and we're halfway through number three.

And number four, I think we're probably over the summer. So that's where those stand at the moment, and that's why I said - I think in my text somewhere - I said even without sort of everything fully cooked, the private sales is making good progress, and the reason is, is because of sort of one, two and call it even halfway through three of those four things.

With respect to the second part of your comment, we view private sales as an incredible service to clients that is complementary to the auction rather than sort of conflicting with it. Many clients have good reasons why they want to pursue something privately, and to be able to offer that service when we're already in front of them and we've already given them a valuation and we already are aware, perhaps on the other side of the planet, of people that have demand for things like that, it's just a service that's really good.

And it's something that our clients appreciate and expect. And with respect to gallarists and dealers, it turns out the gallarists and dealers are some of our most precious and valued clients in the world.

So rather than taking business from them, our mission is to serve them better.

A bigger picture question. When you go into a lot of the major auctions and on the part where you are competing against Christie's and some of the other auction houses, how important is it for you, as you think about winning more of the tentpole pieces versus maintaining your kind of financial discipline, as you think about how aggressive or how you think about negotiating on those big tentpole pieces that drive the auctions?

Or drive the excitement around the auctions?

Well, it's a very interesting question, and I was trying to think back a couple of years to what I said in response to a similar question that was asked to me shortly after the Taubman Guarantee quarter. And I think what I said then was large financial commitments for the firm need to be thought through with a significant eye on both the brand and also on the investors and their need to manage risk and profitability and balance them.

And with the benefit of a couple more years since then, I would say the answer really hasn't changed much. The good news is, we provide a really fantastic service to those people in the marketplace that want to sell or find a new home for their masterpiece, and we've proven that multiple times this past year, including, by the way, last night with that glorious Picasso or earlier last year with the record auction of the American artist Jean-Michel Basquiat, another masterpiece.

And we're going to keep doing that and we're going to keep bringing great masterpieces to the market and we're going to keep creating an environment in which the overall financial return to the consignor of those masterpieces is what I consider to be the best option. At the same time, we're going to do it, because we're shareholders here too and we're going to do it in a responsible way that works for both.

And what that requires is great service, great creativity, great marketing programs and thinking through - and by the way, more of the same in terms of understanding both how to position a piece, how to innovate in ways that make sense and also how to serve our clients really well. So I don't view it as either/or.

I view it as a win-win on both sides.

Great, thanks a lot. Good luck, guys.

Thank you.

Well, if you don't mind, I'll just thank all of my colleagues and the investors and the analysts for tuning in today, and apologize once again for the technical difficulties. We appreciate it.

You guys have been very patient, and we wish you a great day. Thanks.