Sims Limited reported a 3.7% rise in half-year sales revenue to A$3.78 billion, propelled by strong non-ferrous prices and robust growth in its Lifecycle Services division. Underlying EBIT soared 65.9%, reflecting strategic acquisitions and operational efficiencies despite challenging ferrous markets.
- Group sales revenue increased 3.7% to A$3.78 billion
- Underlying EBIT jumped 65.9% to A$121 million, led by Sims Lifecycle Services (SLS)
- SLS expanded with new facility in Ireland and acquisition of Tri-Coastal Trading
- Safety performance improved with record low injury rates
- Interim dividend raised by 40%, reflecting strong capital management
Robust Revenue Growth Amid Market Headwinds
Sims Limited, a global leader in metal recycling, has delivered a solid half-year performance for the six months ending December 2025. Group sales revenue rose 3.7% to A$3.78 billion, underpinned by resilient non-ferrous metal prices and a significant uplift in its Sims Lifecycle Services (SLS) segment. Despite a 2% decline in metal sales volumes due to increased intake of unprocessed scrap requiring additional processing, the company managed to sustain strong trading margins.
SLS Emerges as a Key Growth Engine
The standout contributor to Sims’ earnings was SLS, which saw sales revenue surge nearly 70% to A$327 million. This growth was driven by higher repurposed unit volumes, particularly in DDR4 memory chips, where constrained supply and sustained demand from hyperscalers have created a favourable pricing environment. SLS’s expansion into Europe with a new facility in Dublin aims to replicate its successful US operating model, positioning the company to capitalise on accelerating data centre refresh cycles and AI-driven demand.
Strategic Acquisitions and Operational Efficiency
In line with its strategy to invest responsibly, Sims acquired Tri-Coastal Trading for US$66.5 million, enhancing its footprint in the Houston region and unlocking over US$100 million in land sales potential. The company also progressed infrastructure projects across its network, including rail works and fines plant construction, while rationalising property holdings to strengthen the balance sheet. Operational cost discipline was evident, with underlying costs excluding SLS rising well below inflation, supported by restructuring and tighter controls.
Safety and Sustainability Remain Priorities
Sims reported improved safety metrics, with a 26% reduction in recordable injuries compared to the FY19–FY25 average and a total recordable injury frequency rate (TRIFR) of 1.0, maintaining best-in-class standards. The company is advancing its climate strategy, integrating climate data with financial systems and reviewing its decarbonisation plan, reflecting a commitment to sustainable operations.
Outlook, Navigating Challenges with Strategic Agility
Looking ahead, Sims anticipates continued strength in non-ferrous markets and sustained pricing support for DDR4 memory chips due to structural supply constraints. Tariff protections in the US are expected to bolster domestic ferrous scrap demand, although record-high Chinese steel exports pose a persistent headwind, keeping ferrous prices subdued outside the US. The company’s strategic investments, operational efficiencies, and expanding global network position it well to navigate these dynamics while delivering shareholder value, as evidenced by a 40% increase in the interim dividend to 14 cents per share.
Bottom Line?
Sims Limited’s strategic pivot towards high-value services and disciplined capital management sets the stage for resilient growth amid evolving global metal markets.
Questions in the middle?
- How will Sims manage the ongoing impact of Chinese steel exports on ferrous scrap pricing?
- What is the expected timeline and scale for ramping up the new SLS facility in Ireland?
- How might further property rationalisation unlock additional shareholder value?