The Sims Group reported a profit of $75 million for the fiscal year, ended June 30. The profit was a 54 percent increase from $48.5 million profit the previous year.
The company also reported revenues increased 12 percent to $1.58 billion, reflecting improved metal prices throughout the year on total volumes handled of 5.14 million metric tons, a modest increase from the previous year. Net cash flow from operations was also strong, improving 23 percent to $127 million.
Jeremy Sutcliffe, Sims Group’s managing director, said, “This is an outstanding result, with earnings exceeding not only the previous year by more than 54 percent, but also the company’s previous record by nearly 25 percent”.
In addition to strengthening ferrous scrap markets during the second half of the year, Sutcliffe also attributed the positive results to a host of other steps the company has taken over the past year:
In particular: a focus on operational efficiencies which led to record shredder production and shredder non ferrous recovery revenues
The rationalization or disposal of under-performing business units
The development of the new Recycling Solutions Division which was profitable in its first year and provides a sound platform to broaden Sims's recycling focus through further organic and acquisitive growth
Enhancement of the company’s human resources through improved management appraisal, development, recruitment and training.
For the full year, Sims generated 40 percent of revenue from Australia, 3 percent from New Zealand, 30 percent from the United Kingdom and 27 percent from North America.
Sims also noted several highlights the company achieved this year, including the approval of a mega shredder in the United Kingdom, due for commissioning next year; commissioning a new aluminum smelting facility in Australia; a new plastics recycling operation, also in Australia; upgrading three shredders in Australia to increase capacity and allow the machines to handle nonferrous metals; the sale of a money losing recycling operation in Southern California; achieving budgeted throughput and profitability at its refrigerator recycling facility in the UK, as well as starting construction on a second refrigerator recycling facility; the acquisition of an electronic scrap and tire recycling facility in the UK.
The company also has introduced several other projects over the past year, which it hopes will further the company’s profitability. These increase the opening of a dedicated electronics de-manufacturing facility in California; and the creation of a centralized marketing entity in Sydney, Australia.
The shredding of ferrous raw material and the recovery of the nonferrous content of it, continued to be the company’s main profit contributor and, together with other ferrous operations and brokerage, accounted for more than 75 percent of the group profit during the year, up 43 percent on fiscal 2002. Shredder production, at a record 2.1 million metric tons, was a 5 percent increase from the prior year, and revenue from nonferrous shredder recoveries at $131 million was up 14 percent, another record.