July 25, 2008

Sims Group sees surge in Q4 profit

Reuters reported that world's No 1 scrap recycling firm Sims Group Ltd fourth quarter profit is likely to exceed that of the third quarter following its takeover of US firm Metal Management.

Sims reported an unaudited net profit of AUD 80.3 million for the third quarter ended March 31st 2008 up by 62% QoQ from the December quarter. The result included a contribution from the former Metal Management business for the period between March 15 and March 31.

Mr Daniel Dienst CEO of Sims in a statement said that "Demand and pricing from consumers for our ferrous and non ferrous metals is robust and freight rates have stabilized albeit still at historically high levels, which is supportive of an expectation for attractive operating conditions in our fourth fiscal quarter.”

Mr Dienst said that the company had seen strong prices for scrap metals worldwide, offsetting the effect on earnings of a strong Australian dollar. He added that because of a full contribution from Metal Management, as well as continued firm prices, fourth-quarter earnings are likely to exceed the third quarter, notwithstanding the potential impact of foreign currency translation.