Sims Limited FY24 Trading Update

Sims Limited (ASX: $SGM) provided guidance for its FY24 financial results, expecting the Underlying EBIT in 2H24 to be marginally lower than the HY24 Financial Result. The company faces market dynamics associated with revenue recognition, freight costs, and competitive scrap metal purchases, posing both upside opportunities and downside risks to this guidance.

Executive Commentary on Market Challenges and Performance

Ongoing market challenges have continued across the industry. SA Recycling and ANZ Metal have faced increased challenges compared to the first half. Pleasingly, despite North America Metal facing similar market challenges, we anticipate an improved second-half performance as early positive outcomes of the targeted strategies for margin improvement are emerging. We remain confident in the medium to long-term fundamentals, driven by global decarbonisation efforts.

Summary of FY24 Trading Update and Outlook

Sims Limited anticipates a marginally lower 2H24 Underlying EBIT compared to the HY24 Financial Result, influenced by market dynamics and competitive environment. Despite market pressures, targeted operational metrics are expected to drive an improved performance in North America Metal, while SA Recycling and ANZ Metal forecast lower 2H24 results. UK Metal anticipates an improved performance, and Sims Lifecycle Services remains on track to achieve its targets. The company's cost reduction program is progressing as planned, aiming to enhance financial resilience. Sims Limited, a global leader in metal recycling, continues to drive innovation and leadership in the circular economy, aiming to create a world without waste to preserve the planet.