Sims Limited delivered materially stronger earnings in fiscal 2026, with group EBITDA expanding significantly across most segments. The South American recycling (SAR) division surged 61 percent to US$478.7 million, while the strategic logistics (SLS) segment posted exceptional growth of 334.7 percent to US$129.1 million. The North American metals (NAM) business also advanced 29.3 percent to US$213 million. The Australia and New Zealand (ANZ) segment declined 12.4 percent to A$117.5 million, reflecting weaker commodity pricing and regional market conditions. Return on invested capital improved 7.2 percentage points to 11.7 percent, signaling enhanced capital efficiency across the business.
The standout SLS performance reflects Sims’ strategic pivot toward the technology sector, particularly its growing relationship with hyperscaler customers developing AI infrastructure. The company is positioning itself to provide lifecycle services for increasingly complex data center equipment, creating higher-margin revenue streams beyond traditional metal recycling. This diversification offers some buffer against commodity price cycles that traditionally drive volatility in the recycling sector and represents a meaningful shift in how the company generates shareholder value.
The company’s strategic framework centers on three pillars: strengthening its earnings platform through operational efficiency and scale, deepening hyperscaler partnerships to capture technology-driven growth, and expanding lifecycle services globally. Management has invested in automation and digital workflows to enhance competitiveness while maintaining a simplified organizational structure to retain agility. These investments appear to be yielding results, particularly in the SLS segment and SAR, which operates with a different business model than Sims’ traditional North American operations.
Sims’ sustainability credentials remain a competitive advantage. The company maintained an industry-leading safety record with a total recordable injury frequency rate of 1.09, the fourth consecutive year at this performance level. Critical control verification completion reached 98 percent and critical risk actions closed at 97 percent. Notably, Sims reduced scope 1 and 2 emissions by 50.3 percent relative to fiscal 2020 while maintaining 100 percent renewable electricity across all operated business.
The company has published climate targets aligned with global decarbonization trends: seven to ten percent absolute emissions reduction by 2030, thirteen to sixteen percent by 2035, and net zero by 2050. These commitments, combined with positioning as a provider of circularity solutions and a pathway to decarbonization for its customers, align with regulatory trends and investor expectations around environmental responsibility. Investors should monitor whether the ANZ segment stabilizes and whether SLS growth sustains at recent rates, as these will be critical to offsetting cyclicality in traditional recycling markets. The capital efficiency improvements reflected in the ROIC expansion suggest management is executing on strategy, though the contribution from each segment warrants close observation as the company navigates a shifting commodity and technology landscape. This announcement is price sensitive and has been classified as material by the ASX.
View the full ASX announcement (PDF)
About Sims Limited (ASX: SGM)
Sims Limited is the world’s largest publicly traded metals and electronics recycler, with operations across more than 200 facilities in 15 countries. The company generates approximately three-quarters of its earnings from North America, with the remainder from Australia and New Zealand. Sims is also an emerging leader in municipal recycling and renewable energy industries.
If you would like to discuss this announcement or how it might affect your portfolio, request a callback or call us on 1300 889 603.
