Sims (ASX:SGM), which focuses in metal recycling and circular economy services, issued a market update, projecting a significant lift in financial performance for the 2026 fiscal year despite ongoing geopolitical and macroeconomic headwinds.
The company anticipates a group underlying EBIT between $350 million and $400 million, driven largely by sustained price strength in the non-ferrous and memory chip sectors.
A standout performer in this forecast is Sims Lifecycle Services.
Bolstered by aggressive hyperscaler activity and high secondary-market pricing for DDR4 memory, SLS is expected to contribute between $165 million and $185 million to the group's underlying EBIT.
Investors are looking forward to the upcoming Investor Day in Nashville on March 25, where the company is slated to provide deeper insights into the strategic drivers propelling the SLS business forward.
The broader Metal business has shown remarkable resilience in a complex trade environment.
While elevated Chinese steel exports continue to suppress scrap prices across Australia and New Zealand and export markets, these pressures have been mitigated by strong non-ferrous markets and an improvement in US domestic ferrous prices.
Rising aluminium costs linked to supply constraints have triggered an uplift in Zorba prices.
Sims expects a materially improved second-half performance for its North America and South Asia regions.
Although the short-term outlook for ANZ ferrous prices remains subdued, and the Middle East conflict continues to impact shipping and fuel costs, the company's strategic focus on sourcing unprocessed material appears to be insulating its core operations from more severe volatility.