How Did Sims Ltd(ASX:SGM) Achieve a 248% Jump in Underlying Net Profit for FY2026?

Sonal Goyal

05 November 2026 08:13 PM AEDT

How Did Sims Ltd(ASX:SGM) Achieve a 248% Jump in Underlying Net Profit for FY2026?

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Key Highlights

• Sims reported FY2026 underlying NPAT of $289.1 million, a 248% increase from $83.1 million in FY2025

• Sims Lifecycle Services (SLS) underlying EBIT surged 430% to $172.7 million, driven by hyperscaler Demand and DDR4 pricing

• SA Recycling contributed $235.5 million in underlying EBIT, up 96% year-over-year on favourable non-ferrous markets

• Sales Revenue reached $8,007.5 million, up 6.9%, with return on invested Capital climbing to 11.7% from 4.5%

Sims Ltd(ASX:SGM) closed at A$21.18 on 05 November 2026, gaining 1.05% during a session where the broader S&P/ASX 200 (XJO) advanced 2.61% (+230.60 points) to 9,065.10, and the S&P/ASX 300 Metal & Mining index (XMM) surged 7.90% (+580.50 points) to 7,930.90. Overnight Wall Street gains, propelled by the Democrats' decisive victory in the U.S. midterm elections, provided a tailwind for global Equity markets. Gold gained 1.77% to USD 4,145.70 and silver advanced 1.00% to USD 53.22. Sims is a global company operating in metal recycling and lifecycle services, with operations spanning North America, Australia, New Zealand and internationally.

FY2026 Revenue and Earnings Performance

Sims released its full-year results on 18 August 2026, reporting sales revenue of $8,007.5 million, up 6.9% from $7,494.0 million in FY2025. At constant currency, the revenue increase was 10.9%. Underlying EBIT came in at $468.0 million, up 167.6% from $174.9 million, while statutory NPAT was $245.3 million compared to $2.4 million in the prior year.

The Metal trading Margin increased by 6.2%, or 10.2% at constant currency, reflecting improvements in North America and positive non-ferrous market conditions. Proprietary intake volumes grew 4.9% to 6.4 million tonnes, driven by commercial execution improvements in NAM, competitor Supply disruptions and the contribution from the Tri Coastal Trading Acquisition in Houston. The final Dividend was set at 20 cents per share, fully franked, bringing total FY2026 dividends to 34 cents per share, a 47.8% increase.

Lifecycle Services Emerges as a Growth Engine

The most notable development was the performance of Sims Lifecycle Services (SLS), which recorded underlying EBIT of $172.7 million, up from $32.6 million in FY2025, a 430% increase. SLS revenue was $757.0 million, up 77.4% year-over-year. The division has evolved from traditional IT asset disposition into a strategic partner supporting Data Centre Infrastructure Services, providing Sims with direct exposure to Cloud Computing and AI infrastructure markets.

Processed repurposed units grew 90.9% to 16.8 million, reflecting increased hyperscaler activity and expansion of US data centre capacity. SLS trading margin increased 68.9% on favourable DDR4 secondary-market pricing. The company guided SLS first-half underlying EBIT between $75 million and $90 million for 1H FY2027.

Regional Metals Performance

North America Metal (NAM) underlying EBIT rose to $135.9 million, up 69.7% from FY2025, on higher average selling prices and commercial execution improvements. SA Recycling contributed $235.5 million in underlying EBIT, up 96.3%, benefiting from favourable non-ferrous markets and network density gains through 11 acquisitions adding 12 sites.

Australia and New Zealand (ANZ) was the exception, with underlying EBIT declining 22.7% to $55.8 million as elevated Chinese steel exports continued to pressure ferrous prices domestically and internationally.

Company Overview

Sims operates through four reporting segments: North America Metal, SA Recycling (a joint venture), ANZ Metal, and Sims Lifecycle Services. The company processes ferrous and non-ferrous metals for recycling and provides end-of-life equipment services to data centre operators and cloud providers.

Sector and Market Context

The recycling and metals sector experienced divergent conditions in FY2026, with North American operations benefiting from EAF capacity growth and domestic Tariff support, while Asian markets faced headwinds from Chinese overcapacity. The emergence of SLS as a meaningful contributor positions Sims at the intersection of traditional industrial recycling and the expanding digital infrastructure economy.

Risks to Monitor

ANZ operations remain exposed to ongoing Chinese steel export volumes, which continue to depress regional ferrous prices. SLS earnings are concentrated in DDR4 secondary-market pricing, which could normalise. Currency fluctuations affect translation of US-sourced earnings. The company noted that franking Credit availability on future dividends may reduce below 50% as a greater proportion of earnings is sourced offshore.

Catalysts on Watch

Near-term catalysts include the delivery of SLS 1H FY2027 underlying EBIT within the $75 million to $90 million guided range, progress on the Tri Coastal Trading integration in Houston, and the continuation of SA Recycling's acquisition-driven network expansion. The trajectory of hyperscaler Capital Expenditure and data centre build-out will be a key Factor for SLS growth.

What Comes Next

Sims' FY2026 results underscored a transformation in the company's earnings composition, with SLS now contributing 37% of underlying EBIT compared to 19% in FY2025. The near-term outlook hinges on whether SLS can sustain its growth trajectory alongside continued recovery in North American metals markets, even as ANZ conditions remain constrained by global steel trade dynamics.

FAQs

Q: What was Sims' FY2026 underlying NPAT?

A: Sims reported underlying NPAT of $289.1 million for FY2026, up 248% from $83.1 million in FY2025.

Q: How much did Sims Lifecycle Services earn in FY2026?

A: SLS reported underlying EBIT of $172.7 million, up 430% from $32.6 million in FY2025, driven by hyperscaler demand and DDR4 pricing.

Q: What dividend did Sims declare?

A: Sims declared a final fully franked dividend of 20 cents per share, bringing total FY2026 dividends to 34 cents per share.

Q: How did SA Recycling perform?

A: SA Recycling contributed $235.5 million in underlying EBIT, up 96.3% from FY2025, supported by favourable non-ferrous markets.

Q: What is the SLS outlook for 1H FY2027?

A: Sims guided SLS first-half underlying EBIT between $75 million and $90 million.

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