SIMS LIMITED — Interim / Quarterly Report 2020

Feb 17, 2020

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Financial Results Half year ended 31 December 2019

18 February 2020

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Disclaimer

The material contained in this document is a presentation of information about the Group’s activities current at the date of the presentation, 18 February 2020. It is provided in summary form and does not purport to be complete. It should be read in conjunction with the Group’s periodic reporting and other announcements lodged with the Australian Securities Exchange (ASX).

To the extent that this document may contain forward-looking statements, such statements are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Group, and which may cause actual results to differ materially from those expressed in the statements contained in this release.

This document is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor.

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2

Agenda

Results Overview Alistair Field, Group CEO

Financial Results Stephen Mikkelsen, Group CFO Summary & Outlook Alistair Field, Group CEO

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Static Sheer recently installed in Melbourne, Australia (ANZ Metals)

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1H FY20 Themes

Scrap price crash and historically low zorba prices produced 1H FY20 loss

First half challenges but prices subsequently improved

• The rapid collapse in ferrous scrap prices in September 2019 combined with historically low zorba prices severely compressed margins

• Very low ferrous scrap pricing ~US$220 to US$250 per tonne limited the attractiveness of material collection and sale across various supplier segments , which reduced volumes and margins

• Some recovery evident in the market since December

All financial measures negatively impacted

• Underlying EBIT[1] loss of $23.2 million, down $132.8 million over prior corresponding period

• Underlying NPAT[1] loss of $34.7 million, down $111.4 million over prior corresponding period

• 1H FY20 interim dividend of 6.0 cents per share, fully franked

• Net cash of $151.2 million, down 56.5% on 30 June 2019

Progressing strategic growth plan

• Sims Resource Renewal tested Sims Auto Shred Residue (ASR) with two technologies which supported previous IRRs and demonstrated environmental outcomes better than regulatory requirements

• Recycling the cloud volumes of 9k tonnes in 1H FY20, on track to reach FY20 target of 20k tonnes

• Won additional municipal recycling contract in Florida with contract terms mitigating commodity risk

• New regulation in China classifying high quality non-ferrous scrap as a “renewable metal” rather than “waste” from 1 July 2020 validates the strategic push into increasing retail non-ferrous volumes

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1) Underlying earnings excludes significant non-recurring items and the impact of non-qualifying hedges.

Summary of Financial Outcomes Fully franked interim dividend sustained

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Sales Revenue
$2,709.6 million
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Sales Volumes 4.474 million tonnes 1H 4.30 million | 2H 4.25 million1H FY19 -9.6% 4.951 million tonnes

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1H FY19 -18.7%
$3,334.1 million
Underlying [1] EBITDA
$74.9 million
1H $61 million | 2H $123 million1H FY19
-56.9%
$173.8 million
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Net Cash $151.2 million As at 30 Jne 201630 June 2019 -56.5% $347.5 million

Underlying Return on Capital[2] -1.7% 1H (0.4)% | 2H 5.5%1H FY19 NMF 7.6% Interim Dividend 6.0 cents per share (100% franked) 1H FY19 -73.9% 23.0 cents per share (100% franked)

• Underlying[1] EBIT $(23.2) million 1H ($5) million | 2H $63 million1H FY19 NMF $109.6 million

• Underlying[1] NPAT $(34.7) million 1H ($18) million | 2H $56 million1H FY19 NMF $76.7 million

1) Underlying earnings excludes significant non-recurring items and the impact of non-qualifying hedges.

2) Return on capital = (annualised underlying EBIT net of tax at tax rate of 27.5%) / (net assets - net cash).

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Employee Health & Safety Global commitment for zero harm today

• Safety remains the most important priority for both our employees and the community

0.0 0.5 1.0 1.5 2.0 2.5 3.0	2.8 2.2 1.5 1.3 1.2 1.5 1.2

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• Focus and progress on Critical Risk awareness and management

• Critical Risk Management training launched in December 2019 and assigned to employees and contractors

• Critical Control Verification Inspections undertaken monthly from January 2020 with a new Inspections standard

• Global Perception Safety Survey and employee 1:1s completed, resulting in over 2,500 employee recommendations for improvement. 2020 initiatives incorporate key themes from these recommendations

• Increased safety-related communications, including, a monthly CEO Safety Thought, quarterly EHS Newsletter and updated Global Safety Alerts

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1) Defined as total recordable injuries x 200,000 divided by number of hours worked.

Sustainability

Sims Sustainability Strategy aligned with overall purpose and growth strategy

Sims Sustainability Strategy

• Sustainability Strategy aligned to our purpose “Create a world without waste to preserve our planet” and growth strategy

Close the loop: The foundation of our business

We close resource loops by enabling society to restore, repair, refurbish, remanufacture and recycle materials. Across our business divisions, we collect, sort and pre-process valuable resources to keep them in the loop at their highest value.

• Long term sustainability goals under development and will be released in 2020

• Sims will host an ESG Briefing on 19 March 2020

• To support the community during these devastating bush fires, we have offered the use of our equipment, paid leave for volunteers and an employee donation matching program

Optimise: Raising the bar

Value: Amplifying our impact

We are investing in innovative technologies that allow us to extract more value from inputs, re-think waste and enable the circular economy. Optimising our processes can increase metal yields and differentiate our products. We’re expanding into new business adjacencies, such as recovering energy from waste, and new markets, such as recycling the cloud and converting landfill gas to energy.

The shift to a circular economy will require innovative business models that either replace or improve existing ones, or spark new opportunities. We collaborate with our customers to challenge conventional models of product design, manufacturing, distribution and, ultimately, reuse and recycling. We see great potential to create shared value by partnering for change across the value chain.

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Group Financial Performance

A$m	1H FY19	1H FY20	% Chg
Sales revenue	3,334.1	2,709.6	-18.7%
Statutory EBITDA	173.1	30.5	-82.4%
Underlying EBITDA1	173.8	74.9	-56.9%
Statutory EBIT	108.9	(95.2)	NMF
Underlying EBIT1	109.6	(23.2)	NMF
Statutory NPAT	76.5	(91.1)	NMF
Significant items 0.2 56.4 NMF
Underlying NPAT1	76.7	(34.7)	NMF
Statutory EPS (diluted) 37.1 (44.9) NMF
Underlying EPS (diluted) 1	37.2	(17.1)	NMF
Dividend per share (cents)	23.0	6.0	-73.9%
Total Invested Capital2	2,103.5	2,015.5	-4.2%
Underlying ROC3	7.6%	(1.7)%	NMF

• Lower ferrous prices resulted in lower collection rates

• Non ferrous volumes remained resilient

• Weak or negative margins throughout 1H FY20 due to:

  • Intense competition for lower ferrous scrap inflow

  • Low zorba prices

  • Unsold inventory leading into September which was sold at a loss

• Remain focused on lifting ROC above 10%

• 1) Underlying earnings excludes significant non-recurring items and the impact of non-qualifying hedges.

• 2) Total Invested Capital = Net Assets – Net Cash.

• 3) Return on capital = (annualised underlying EBIT net of tax at tax rate of 27.5%) / (net assets - net cash).

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Markets

Volatile market conditions with improved pricing in December and January 2020

Ferrous – Improved pricing since scrap market crash

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400
350
300
250
200
Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 May-19 Aug-19 Nov-19 Feb-20
Non-ferrous - Zorba recovery since Oct 2019 lows
2,500
2,000
1,500
1,000
500
Jan-18 May-18 Sep-18 Jan-19 May-19 Sep-19 Jan-20
Zorba Twitch Ingot
(US$/tonne)
Turkey HMS 80:20 Price
(US$ /tonne)
Zorba, Twitch and A380 Ingot Price
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China Non-ferrous Reclassification

• China has reclassified high grade non-ferrous metals as a “renewable metal” rather than “waste”, enabling import of these materials from 1 July 2020 without quotas

• The regulation will enable ~90% of Sims’ grades of scrap to be imported

• 30-40% of non-ferrous volume is typically exported to China

• Chinese non-ferrous quotas remain in place until 31 December 2020

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Category 6 Total Quotas from 1 July
(‘000 tonnes) 2019 (at 6 February 2020)
Copper 831
Aluminium 725
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Source: Reuters

Source: Platts (top and bottom chart)

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Financial Results Stephen Mikkelsen, Group CFO

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Statutory EBIT Reconciliation

Business restructuring to reduce costs and rationalise sites

A$m	1H FY20
Statutory EBIT	(95.2)
Legacy Brand Write Off	14.6
Other Intangible Impairments	13.0
Environmental Provisions 11.0
Restructuring and Redundancy Provisions 33.6
Loss on Sale of European compliance scheme operations 3.2
Impact of Fires, Net of Insurance Recoveries (5.3)
Non-qualified Hedges 1.9
Underlying EBIT1	(23.2)

• Restructuring in North America Metals and UK Metals includes:

• Closing 11 sites in the UK

• Consolidating the volumes from the closed sites to four multi functional sites

• 185 redundant positions

• Annualised savings and cost efficiencies are estimated at A$30 million per year

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1) Underlying earnings excludes significant non-recurring items and the impact of non-qualifying hedges.

Business Segment Financial Performance EBIT margins more adversely impacted than sales volumes

Underlying EBIT1 (A$m)	1H FY19	1H FY20	Chg %
North America Metals	55.3	0.1	-99.8%
ANZ Metals	51.8	22.3	-56.9%
UK Metals	6.8	(28.4)	NMF
Sims Lifecycle Services	10.0	14.8	48.0%
SA Recycling	16.8	-	NMF
Global Trading	(7.3)	(7.0)	4.1%
Corporate & Other	(23.8)	(25.0)	-5.0%
Underlying EBIT	109.6	(23.2)	NMF

Sales volumes (‘000 tonnes)	1H FY19	1H FY20		Chg %
North America Metals2	2,517	2,275		-9.6%
ANZ Metals2	875	806		-7.9%
UK Metals2	792	662		-16.4%
Global Trading	671	635		-5.4%
Other Brokerage	96	96		-
Total sales volumes	4,951	4,474		-9.6%
Intake volumes (‘000 tonnes)	1H FY19	1H FY20		Chg %
North America Metals2	2,430	2,239		-7.9%
ANZ Metals2	958	809		-15.6%
UK Metals2	827	661		-20.1%
Global Trading	671	635		-5.4%
Other Brokerage	96	96		-
Intake volumes	4,982	4,440		-10.9%

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1) Underlying earnings excludes significant non-recurring items, the impact of non-qualifying hedges and internal recharges. 2) Proprietary volumes exclude ferrous and non-ferrous brokerage volumes.

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North America Metals

Break-even result despite challenging market due to higher material recovery and cost reductions

A$m	1H FY19	1H FY20	% Chg
Underlying EBIT1	55.3	0.1	-99.8%
Proprietary Sales Volumes (‘000 tonnes)	2,517	2,275	-9.6%
Underlying EBIT / tonne	22.0	-	NMF
Underlying EBIT (constant currency)	55.3	(0.6)	NMF

Non-ferrous Retail volumes stable despite market

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180
150
120
90
60
30
0
FY18 FY19 FY20
1H 2H
‘000 tonnes
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 Sales volumes were down 9.6% over prior corresponding period

• Break-even underlying EBIT despite challenging market conditions

 Earnings decline driven by:

• Intense competition for lower ferrous scrap inflow following fall in ferrous prices

• Weak zorba prices

• Heavy flooding in some Southern states impacted movement of scrap during the period

• Partially off-set by higher material recovery rates and disciplined cost management

• Disciplined approach to capital management with feeder yards on track in the medium term

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1) Underlying earnings excludes significant non-recurring items, the impact of non-qualifying hedges and internal recharges.

Australia & New Zealand Metals

Positive earnings supported by internal initiatives and cost reductions

A$m	1H FY19	1H FY20	% Chg
Underlying EBIT1	51.8	22.3	-56.9%
Proprietary Sales Volumes (‘000 tonnes)	875	806	-7.9%
Underlying EBIT / tonne	59.2	27.7	-53.2%

• Underlying EBIT was $22.3 million, down 56.9% over prior corresponding period

• Decline in profitability driven by challenging market conditions, lower ferrous prices and sales volumes

Crude Steel Production Australia

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6,000
5,000
4,000
3,000
2,000
1,000
-
2013 2014 2015 2016 2017 2018 2019
‘000 tonnes
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• Positive EBIT margins supported by internal initiatives and swift cost reduction response

• Sales volume declined 7.9% over prior corresponding period:

• Lower ferrous prices limited the attractiveness of material collection and sale across various supplier segments

• Non-ferrous volumes less impacted than ferrous

• Continued healthy demand for ferrous scrap metal from Australian steel mills

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Source: World Steel Association

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1) Underlying earnings excludes significant non-recurring items, the impact of non-qualifying hedges and internal recharges.

UK Metals

Strategic restructure provides a lower operating cost base from 2H FY20

A$m	1H FY19	1H FY20	% Chg
Underlying EBIT1	6.8	(28.4)	NMF
Proprietary Sales Volumes (‘000 tonnes)	792	662	-16.4%
Underlying EBIT / tonne	8.6	(42.9)	NMF
Underlying EBIT (constant currency)	6.8	(27.7)	NMF

Fall in Ferrous Intake Volumes

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150
100
50
-
Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19
‘000 tonnes
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• Underlying EBIT loss of $28.4 million, down compared to prior corresponding period

• Sales volume decline of 16.4% mainly due to low pricing environment in 1H FY20 reducing ferrous scrap inflow

• Negative earnings driven by:

• Unsold inventory leading into September which was sold at a loss

• Low ferrous and zorba pricing

• Intense competition for reduced volumes

• Strategic restructure creates four larger sites that maintain FY19 volumes and closes 11 sites, providing a lower operating cost base from 2H FY20

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1) Underlying earnings excludes significant non-recurring items, the impact of non-qualifying hedges and internal recharges.

Sims Lifecycle Services

On track to achieve FY20 volume targets

A$m	1H FY19	1H FY20	% Chg
Underlying EBIT1	10.0	14.8	48.0%
Underlying EBIT (constant currency)	10.0	14.5	45.0%

• Sale of European Compliance Scheme Operations during 1H FY20 (subject to European Commission approval)

• Strong 1H FY20 result driven by:

• Improved volumes from recycling the cloud

Sims Lifecycle Services Remaining Businesses[2]

A$m	FY19	1H FY19	1H FY20
Underlying EBIT1	3.7	0.1	0.8
Total Volumes (tonnes)	74,700	33,600	34,100
Cloud Volumes (tonnes)	15,200	7,000	8,900

• More selective purchasing and higher gold price

• Maximising profit opportunities prior to the sale of European Compliance Scheme Operations

• Continued strength and growth in cloud volumes

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1) Underlying earnings excludes significant non-recurring items, the impact of non-qualifying hedges and internal recharges. 2) Excludes the sale of European Compliance Scheme Operations.

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SA Recycling EBIT reduction primarily driven by falling zorba prices and ferrous scrap market crash

A$m	1H FY19	1H FY20	% Chg
Underlying EBIT (50% share)	16.8	-	NMF
Sales Volumes(‘000 tonnes) (50% of SA tonnes)	840	800	-4.8%
Underlying EBIT / tonne	20.0	-	NMF
Underlying EBIT (constant currency)	16.8	-	NMF

SAR Operational Zorba Separation Technology

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Zorba Cleaning
Technology: Zorba Separation
• Anaheim, CA
Complete •• Atlanta, GATerminal Island, CA Complete Technology: • Anaheim, CA
• Phoenix, AZ
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• Underlying EBIT of nil due to:

  • Low pricing for zorba

  • Volume and margin squeeze associated with ferrous scrap market crash and low ferrous pricing

• Volume declined 4.8% on prior

• corresponding period due to low pricing environment in 1H FY20 reducing ferrous scrap inflow

• Zorba separation technology operational in Anaheim California, and zorba cleaning technology performing well across all four locations

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Global Trading

Lower costs reflect lower employee benefits expense and operation of one non-ferrous trading office

A$m	1H FY19	1H FY20	% Chg
Brokerage Gross Margin	6.8	5.9	-13.2%
Operating Costs	(14.1)	(12.9)	8.5%
Underlying EBIT1	(7.3)	(7.0)	4.1%
Brokerage Volumes (‘000 tonnes)	671	635	-5.4%
Underlying EBIT (constant currency)	(7.3)	(6.0)	17.8%

• Underlying EBIT represents external and SA Recycling brokerage less the costs of running the global trading operations

• Brokerage export volumes decreased due to reduced volumes from SA Recycling

• Operating costs decreased due to lower employee benefits expense and a higher 1H FY19 cost from running two offices while moving non-ferrous trading from Hong Kong to Singapore in 1H FY19

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1) Underlying earnings excludes significant non-recurring items, the impact of non-qualifying hedges and internal recharges.

Corporate & Other

Transparency of costs for growth businesses

Corporate (A$m)	1H FY19	1H FY20	% Chg
Underlying EBIT1	(29.1)	(31.3)	-7.6%
Underlying EBIT (constant currency)	(29.1)	(30.3)	-4.1%
Sims Municipal Recycling (A$m)	1H FY19	1H FY20	% Chg
Underlying EBIT1	(0.1)	1.0	NMF
Underlying EBIT (constant currency)	(0.1)	0.9	NMF
LMS Energy (A$m)	1H FY19	1H FY20	% Chg
Underlying EBIT (50% share)	5.4	6.4	18.5%
Sims Energy (A$m)	1H FY19	1H FY20	% Chg
Underlying EBIT	-	(0.5)	NMF
Sims Resource Renewal (A$m)	1H FY19	1H FY20	% Chg
Underlying EBIT	-	(0.6)	NMF

Corporate

• Underlying EBIT of $(31.3) million, increased 4.1% over prior corresponding period at constant currency due to an increase in professional services

Sims Municipal Recycling

 Underlying EBIT of $1.0 million due to prorata of paper price contract amendment partially off-set by increasing residue rates and disposal costs as well as lower paper and plastic pricing

Sims Resource Renewal

• Implementing technology to convert 1 million tonnes of ASR into high quality reusable products

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1) Underlying earnings excludes significant non-recurring items, the impact of non-qualifying hedges and internal recharges.

Product Segment Sales Volumes

Stable non-ferrous volumes despite challenging market conditions

Sales volumes(‘000 tonnes)	1H FY19	1H FY20	Chg %
North America Metals	2,517	2,275	-9.6%
ANZ Metals	875	806	-7.9%
UK Metals	792	662	-16.4%
Total Proprietary Volumes	4,184	3,743	-10.5%
Global Trading & Other Brokerage	767	731	-4.7%
Sales volumes	4,951	4,474	-9.6%

Sales Volumes by Region

• Total proprietary sales volumes decreased by 10.5% in 1H FY20

• Volume decline due to low pricing environment in 1H FY20 limited the attractiveness of collection and sale of scrap

Sales volumes(‘000 tonnes)	1H FY19	1H FY20	Chg %
Ferrous Trading	3,963	3,521	-11.2%
Non-Ferrous Trading	221	222	0.5%
Brokerage	767	731	-4.7%
Sales volumes	4,951	4,474	-9.6%

Sales Volumes by Product

• Ferrous trading volumes down 11.2% in 1H FY20

• Non-ferrous volumes were flat compared to 1H FY19

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Net Cash Position

Returning value to shareholders through dividends and share buy back

A$m	1H FY20	1H FY20
Net Cash at 1 July 2019		347.5
Net profit	(91.1)
Depreciation & amortisation	98.1
Non-cash impairments	41.7
Change in working capital	(63.6)
Net interest and tax paid	(22.0)
Other non-cash items	(3.5)
Operating cash flow, net of operating recoveries		(40.4)
Capital expenditure, net of recoveries	(70.7)
Other cash flow from investing	0.3
Free cash flow		(110.8)
Dividends paid	(38.6)
Share buy-back	(22.4)
Lease payments	(31.1)
Proceeds from issue of ordinary shares	1.7
Other net cash flow from financing and FX	4.9
Change in net cash		(196.3)
Net Cash at 31 December 2019		151.2

• Working capital decline of $63.6 million

• $50 million seasonality similar to 1H FY19

• Net Cash capex of $70.7 million

• Key projects include Avonmouth shredder upgrade, 2[nd] zorba separation line at Claremont, and copper granulation upgrades in North America and UK

• $38.6 million dividend

• $22.4 million from share buy-back and payments for employee share purchase plans

• Cash from sale of European Compliance Scheme Operations expected in 2H FY20 and not included in 31 December 2019 net cash

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Capital Expenditure Continued discipline in the capital expenditure program

Capital Expenditure

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250
200
150
100
50
0
FY16 FY17 FY18 FY19 FY20F
Sustaining Capex Sustaining Forecast
Growth Capex Growth Forecast
$ million
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• Capital expenditure reduction initiatives have reduced capex by $25 million compared to original FY20 forecast

• Net cash balance of $151.2 million as at 31 December continues to support strategic growth initiatives

• Forecast total capex of $180 million in FY20 excluding potential bolt-on acquisitions

• Resulting depreciation from existing assets and new capital expenditure expected to be approximately $220 million for FY20, including $80 million of right of use (leased) assets

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Strategic Progress & Outlook Alistair Field, Group CEO

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Strategic Growth

Sims Resource Renewal: To convert 1 million tonnes of ASR to quality products

• ASR will be converted to vitrified product and a high quality syngas that can produce different products, including electricity, biofuels to full resource renewal (recycled plastic)

• Manage risk of rising waste disposal costs and position Sims at the centre of the circular economy

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Progress - Energy Recovery Plant

• Detailed investigation of four short listed technologies

• Laboratory testing of Sims ASR for chemical composition

• Sims ASR tested with two technologies which supported previous IRRs and demonstrated environmental outcomes better than regulatory requirements

• Preliminary engagement with Government and Regulators

• Construction expected to commence in late 2021 (subject to regulatory approval)

• Expect first plant to be operational in 2022

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Strategic Growth Sims Lifecycle Services: Setting the foundations to scale and grow the business profitably

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Integrated
service
provider
Global Enabling
compliance sustainability
Sims
Lifecycle Services
Linked to the
More than
larger Sims
recycling
Group
A secure
partner
----- End of picture text -----

• Active engagement with all major global cloud providers across multiple products and regions

• Strong base to grow from:

• Proven secure partner

• Integrated circular services

• Global compliance and strong sustainable brand

• Setting the foundations to scale business through systems, processes and leverage of Sims material routing and infrastructure

• On track to achieve target of 20,000 tonnes in FY20 and 200,000 tonnes by FY25

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Conclusion & Outlook

Resilience shown despite challenging markets and an attractive long-term growth outlook remains

1H FY20

• The September scrap price crash, combined with historically low zorba prices and aggressive competitor buying behaviour, severely impacted first half margins and ultimately resulted in an underlying EBIT loss of $23.2 million

• Management has responded to the challenging first half conditions with an extensive restructuring and cost reduction programme that will achieve a full run rate of A$30 million in FY21

• Good progress on implementation of strategic growth plan with recycling the cloud volumes on track for FY20 target, recent municipal recycling contract win and positive testing of Sims ASR

Outlook

• 2H FY20 underlying EBIT is still expected to be within the previously guided range of $40 million to $60 million[1] . Risks to this outcome include the:

• Impact of the Coronavirus on both ferrous and non-ferrous demand and prices;

• Continued aggressive competitor buy side pricing (that has recently indicated some softening); and

• Change to initial signs of positive sentiment in gradual recovery of the Turkish economy

• New regulation in China classifying high quality non-ferrous scrap as a “renewable metal” rather than “waste” from 1 July 2020 validates the strategic push into increasing non-ferrous volumes

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1. Adjusted for the sale of E-Recycling’s European Compliance Scheme Operations.

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Questions & Answers

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27

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Appendix

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28

Grou Profit & Loss p

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20	Chg %
Sales revenue	6,310.9	4,651.7	5,079.4	6,448.0	6,640.0		3,334.1	2,709.6	-18.7%
Statutory EBITDA	265.6	83.0	313.5	395.8	358.1		173.1	30.5	-82.4%
Underlying EBITDA	260.0	190.4	292.4	392.3	363.4		173.8	74.9	-56.9%
Statutory EBIT	144.8	(215.5)	201.2	278.6	225.0		108.9	(95.2)	NMF
Underlying EBIT	139.2	64.0	180.1	275.1	230.3		109.6	(23.2)	NMF
Net Interest (expense)/income	7.8	(9.7)	(10.2)	(8.9)	(6.7)		(2.9)	(7.5)	-158.6%
Statutory tax (expense)/benefit	(27.2)	8.7	12.6	(66.2)	(65.7)		(29.5)	11.6	NMF
Underlying tax (expense)/benefit	(32.8)	(9.2)	(52.6)	(78.2)	(61.7)		(30.0)	(4.0)	-86.7%
Statutory NPAT	109.8	(216.5)	203.6	203.5	152.6		76.5	(91.1)	NMF
Significant items	(10.4)	259.4	(85.3)	(14.9)	9.3		0.2	56.4	NMF
Underlying NPAT	99.4	42.9	118.3	188.6	161.9		76.7	(34.7)	NMF
Statutory EPS (diluted)	53.3	(106.8)	101.6	98.7	74.2		37.1	(44.9)	NMF
Underlying EPS (diluted)	48.2	21.2	59.0	91.5	78.8		37.2	(17.1)	NMF
Dividend per share (cents)	29.0	22.0	50.01	53.0	42.0		23.0	6.0	-73.9%

==> picture [45 x 44] intentionally omitted <==

29

1) Includes 10.0 cents per share 2017 Special Dividend.

North America Metals

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20	Chg %
Sales Revenue	2,916.4	1,942.5	1,984.0	2,607.1	2,725.6		1,401.0	1,133.0	-19.1%
Statutory EBITDA	66.2	35.2	106.0	121.0	124.8		60.9	12.4	-79.6%
Underlying EBITDA	88.4	84.8	124.4	159.5	162.6		84.4	43.4	-48.6%
Depreciation	47.4	51.9	45.0	46.9	53.2		25.1	41.4	-64.9%
Amortisation	13.0	11.7	8.9	7.9	9.7		4.0	1.9	52.5%
Statutory EBIT	5.8	(35.1)	52.1	66.2	61.9		31.8	(45.5)	NMF
Underlying EBIT	28.0	21.2	70.5	104.7	99.7		55.3	0.1	-99.8%
Assets	970.6	910.7	904.4	1,070.4	1,065.4		1,112.4	1,135.3	2.1%
Intake Volumes (000's)	5,664	4,625	4,312	5,044	4,827		2,451	2,300	-6.2%
Proprietary Sales Volumes (000's)	5,499	4,517	4,344	4,865	4,887		2,517	2,275	-9.6%
Brokerage Sales Volumes (000's)	312	118	87	47	56		21	61	190.5%
Total Sales Volumes (000's)	5,811	4,635	4,431	4,912	4,943		2,538	2,336	-8.0%
Employees1	1,905	1,656	1,490	1,578	1,577		1,587	1,475	-7.1%

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1) FY18 employee count has been amended to exclude 156 contingent workers as these workers are non-permanent workers and are excluded from the FY19 employee count.

30

Investment in SA Rec clin y g

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20	Chg %
Statutory EBIT	0.5	(120.6)	26.3	67.8	41.0		21.9	-	NMF
Underlying EBIT	0.5	(1.5)	26.3	68.5	35.9		16.8	-	NMF
Assets	243.1	126.8	131.9	180.7	211.1		197.3	207.4	5.1%
Intake Volumes (000's) 1	2,156	2,005	2,557	3,477	3,473		1,697	1,640	-3.4%
Sales Volumes (000's) 1	2,135	2,049	2,548	3,342	3,531		1,679	1,600	-4.7%

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31

1) Volumes represent total volumes recorded for SA Recycling, LLC and includes the portion sold through Sims Group Global Trade Corporation.

Australia & New Zealand Metals

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20	Chg %
Sales Revenue	1,053.3	743.6	981.4	1,071.0	1,203.7		617.0	503.5	-18.4%
Statutory EBITDA	85.0	58.0	90.9	121.6	125.6		53.4	42.3	-20.8%
Underlying EBITDA	98.5	75.6	102.4	126.2	137.9		67.4	47.8	-29.1%
Depreciation	26.6	26.0	28.2	29.1	31.2		15.6	25.4	-62.8%
Amortisation	1.1	0.9	0.4	0.2	0.2		0.0	0.1	NMF
Statutory EBIT	57.3	31.1	62.3	92.3	94.2		37.8	16.8	-55.6%
Underlying EBIT	70.8	48.7	73.8	96.9	106.5		51.8	22.3	-56.9%
Assets	463.3	481.7	542.5	625.2	614.1		595.4	654.0	9.8%
Intake Volumes (000's)	1,848	1,485	1,616	1,669	1,836		1,031	843	-18.2%
Proprietary Sales Volumes (000's)	1,782	1,377	1,530	1,585	1,763		875	806	-7.9%
Brokerage Sales Volumes (000's)	92	41	126	111	119		73	34	-53.4%
Total Sales Volumes (000's)	1,874	1,418	1,656	1,696	1,882		948	840	-11.4%
Employees1	813	712	709	715	921		904	932	3.1%

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32

1) FY18 employee count excludes Sims Pacific Metals employees.

UK Metals

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20	Chg %
Sales Revenue	1,036.6	759.1	924.3	1,203.0	1,186.9		586.2	487.6	-16.8%
Statutory EBITDA	38.0	(15.7)	50.5	42.0	19.7		10.7	(46.6)	NMF
Underlying EBITDA	44.3	43.8	54.2	50.5	39.5		16.5	(13.5)	NMF
Depreciation	12.5	13.8	12.0	14.9	18.3		9.1	14.5	-59.3%
Amortisation	-	-	-	0.3	0.9		0.6	0.4	33.3%
Statutory EBIT	25.5	(29.7)	38.5	26.8	0.5		1.0	(61.5)	NMF
Underlying EBIT	31.8	30.0	42.2	35.3	20.3		6.8	(28.4)	NMF
Assets	258.3	245.2	329.2	431.4	389.9		402.5	459.6	14.2%
Intake Volumes (000's)	1,598	1,420	1,570	1,696	1,635		829	662	-20.1%
Proprietary Sales Volumes (000's)	1,583	1,350	1,589	1,691	1,602		792	662	-16.4%
Brokerage Sales Volumes (000's)	6	11	1	3	2		2	1	-50.0%
Total Sales Volumes (000's)	1,589	1,361	1,590	1,694	1,604		794	663	-16.5%
Employees1	704	612	660	690	761		785	704	-10.3%

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33

1) FY18 employee count excludes Morley and Barnsley employees.

Global Tradin g

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20	Chg %
Sales Revenue	455.2	352.6	386.6	733.5	690.9		342.4	293.2	-14.4%
Statutory EBITDA	14.1	3.2	3.1	19.0	23.3		10.6	3.0	-71.7%
Underlying EBITDA	(8.2)	(10.5)	(15.3)	(12.3)	(14.9)		(7.2)	(6.4)	11.1%
Depreciation	0.1	0.1	0.1	0.1	0.2		0.1	0.6	-500.0%
Amortisation	-	-	-	-	-		-	-	NMF
Statutory EBIT	14.1	3.1	3.0	18.8	23.1		10.5	2.4	-77.1%
Underlying EBIT	(8.3)	(10.6)	(15.4)	(12.4)	(15.1)		(7.3)	(7.0)	4.1%
Assets	90.4	77.6	108.0	95.6	67.2		73.7	36.5	-50.5%
Intake Volumes (000's)	1,221	1,135	1,028	1,558	1,384		671	635	-5.4%
Sales Volumes (000's)	1,207	1,137	1,023	1,554	1,374		671	635	-5.4%
Employees	45	45	46	69	75		78	74	-5.1%

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34

Sims Lifec cle Services y

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20	Chg %
Sales Revenue	795.0	792.7	726.9	758.4	746.5		349.6	247.9	-29.1%
Statutory EBITDA	53.0	(2.6)	30.6	34.5	26.4		11.6	13.8	19.0%
Underlying EBITDA	57.1	23.3	36.3	39.7	34.5		14.3	21.1	47.6%
Depreciation	10.6	11.2	8.2	8.4	8.5		4.3	6.3	-46.5%
Amortisation	0.6	0.4	-	-	-		-	-	NMF
Statutory EBIT	41.8	(60.2)	22.4	26.1	17.9		7.3	(5.5)	NMF
Underlying EBIT	45.9	11.7	28.1	31.3	26.0		10.0	14.8	48.0%
Assets	473.3	447.9	382.1	397.3	340.6		400.7	274.7	-31.4%
Employees1	1,703	1,471	1,417	1,420	1,350		1,445	971	-32.8%

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35

1) 1H FY20 employee count excludes European compliance scheme operation employees.

Cor orate & Other p

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20	Chg %
Sales Revenue	54.4	61.2	76.2	75.0	86.4		37.9	44.4	17.2%
Statutory EBITDA	8.8	6.4	6.1	(10.1)	(2.7)		4.0	5.6	40.0%
Underlying EBITDA	(20.6)	(25.1)	(35.9)	(39.8)	(32.1)		(18.4)	(17.5)	4.9%
Depreciation	8.9	10.4	9.5	9.4	10.9		5.4	7.5	-38.9%
Amortisation	-	-	-	-	-		-	-	NMF
Statutory EBIT	(0.2)	(4.1)	(3.4)	(19.4)	(13.6)		(1.4)	(1.9)	35.7%
Underlying EBIT	(29.5)	(35.5)	(45.4)	(49.2)	(43.0)		(23.8)	(25.0)	-5.0%
Assets	382.8	281.0	344.9	401.2	497.1		346.8	574.6	65.7%
Employees	259	260	239	280	311		301	363	20.6%

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36

Financial Summar – Grou y p

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20
Group Results
Sales Revenue	6,310.9	4,651.7	5,079.4	6,448.0	6,640.0		3,334.1	2,709.6
Underlying EBITDA	260.0	190.4	292.4	392.3	363.4		173.8	74.9
Underlying EBIT	139.2	64.0	180.1	275.1	230.3		109.6	(23.2)
Underlying NPAT	99.4	42.9	118.3	188.6	161.9		76.7	(34.7)
Underlying EPS (cents per share)	48.2	21.2	59.0	91.5	78.8		37.2	(17.1)
Dividend (cents per share)	29.0	22.0	50.0 3	53.0	42.0		23.0	6.0
Balance Sheet
Total Assets	2,881.8	2,570.9	2,743.0	3,201.8	3,185.4		3,128.8	3,342.1
Total Liabilities	769.0	738.4	775.4	1,013.1	886.7		871.7	1,175.4
Total Equity	2,112.8	1,832.5	1,967.6	2,188.7	2,298.7		2,257.1	2,166.7
Net Cash	313.9	242.1	373.0	298.1	347.5		153.6	151.2
Cash Flows
Operating Cash Flow	298.1	131.3	266.4	252.1	360.1		20.0	(34.1)
Capital Expenditure	(95.3)	(108.9)	(126.5)	(176.1)	(197.1)		(84.5)	(80.0)
Free Cash Flow1	202.8	22.4	139.9	76.0	163.0		(64.5)	(114.1)
NOPAT	100.9	46.4	130.6	199.4	167.0		79.5	(16.8)
Total Capital	1,798.9	1,590.4	1,594.6	1,890.6	1,951.2		2,103.5	2,015.5
ROC2 (%)	5.6%	2.9%	8.2%	10.5%	8.6%		7.6%	-1.7%

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1) Free cash flow = operating cash flow - capex

37

2) Return on Capital = (annualised underlying EBIT net of tax at effective tax rate of 27.5%) / (net assets – net cash)

Financial Summar – Se ment y g

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20
Sales Revenue
North America Metals	2,916.4	1,942.5	1,984.0	2,607.1	2,725.6		1,401.0	1,133.0
ANZ Metals	1,053.3	743.6	981.4	1,071.0	1,203.7		617.0	503.5
UK Metals	1,036.6	759.1	924.3	1,203.0	1,186.9		586.2	487.6
Sims Lifecycle Services	795.0	792.7	726.9	758.4	746.5		349.6	247.9
Global Trading	455.2	352.6	386.6	733.5	690.9		342.4	293.2
Corporate & Other	54.4	61.2	76.2	75.0	86.4		37.9	44.4
Total	6,310.9	4,651.7	5,079.4	6,448.0	6,640.0		3,334.1	2,709.6
Underlying EBIT
North America Metals	28.0	21.2	70.5	104.7	99.7		55.3	0.1
ANZ Metals	70.8	48.7	73.8	96.9	106.5		51.8	22.3
UK Metals	31.8	30.0	42.2	35.3	20.3		6.8	(28.4)
Sims Lifecycle Services	45.9	11.7	28.1	31.3	26.0		10.0	14.8
Investment in SA Recycling	0.5	(1.5)	26.3	68.5	35.9		16.8	-
Global Trading	(8.3)	(10.6)	(15.4)	(12.4)	(15.1)		(7.3)	(7.0)
Corporate & Other	(29.5)	(35.5)	(45.4)	(49.2)	(43.0)		(23.8)	(25.0)
Total	139.2	64.0	180.1	275.1	230.3		109.6	(23.2)
Underlying EBIT Margin (%)
North America Metals	1.0%	1.1%	3.6%	4.0%	3.7%		3.9%	0.0%
ANZ Metals	6.7%	6.5%	7.5%	9.0%	8.8%		8.4%	4.4%
UK Metals	3.1%	4.0%	4.6%	2.9%	1.7%		1.2%	-5.8%
Sims Lifecycle Services	5.8%	1.5%	3.9%	4.1%	3.5%		2.9%	6.0%
Total	2.2%	1.4%	3.5%	4.3%	3.5%		3.3%	-0.9%

Underlying earnings excludes significant non-recurring items, the impact of non-qualifying hedges and internal recharges.

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38

1)

Financial Summar – Se ment cont. y g ( )

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20
Proprietary sales tonnes (‘000)1
North America Metals	5,499	4,517	4,344	4,865	4,887		2,517	2,275
ANZ Metals	1,782	1,377	1,530	1,585	1,763		875	806
UK Metals	1,583	1,350	1,589	1,691	1,602		792	662
Total	8,864	7,244	7,463	8,141	8,252		4,184	3,743
Underlying EBIT2
North America Metals	28.0	21.2	70.5	104.7	99.7		55.3	0.1
ANZ Metals	70.8	48.7	73.8	96.9	106.5		51.8	22.3
UK Metals	31.8	30.0	42.2	35.3	20.3		6.8	(28.4)
Total	130.6	99.9	186.5	236.9	226.5		113.9	(6.0)
EBIT / tonne (A$/t)
North America Metals	5.09	4.69	16.23	21.52	20.40		21.97	0.04
ANZ Metals	39.73	35.37	48.24	61.14	60.41		59.20	27.67
UK Metals	20.09	22.22	26.56	20.88	12.67		8.59	(42.90)
Total	14.73	13.79	24.99	29.10	27.45		27.22	(1.60)

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1) Proprietary sales volumes exclude ferrous and non-ferrous brokerage sales volumes.

39

2) Underlying earnings excludes significant non-recurring items, the impact of non-qualifying hedges and internal recharges.

Financial Summar – Product y

A$m	FY15	FY16	FY17	FY18	FY19		1H FY19	1H FY20
Sales tonnes (‘000)
Ferrous Trading	8,325	6,768	7,009	7,709	7,817		3,963	3,521
Non Ferrous	539	476	454	432	435		221	222
Brokerage	1,617	1,307	1,237	1,715	1,551		767	731
Total	10,481	8,551	8,700	9,856	9,803		4,951	4,474
Sales Revenue
Ferrous Metals	4,067.7	2,703.0	3,136.1	4,381.6	4,505.4		2,307.1	1,783.6
Non Ferrous Metals	1,341.7	1,055.3	1,123.7	1,215.6	1,271.4		628.8	624.0
Sims Lifecycle Services	795.0	792.7	726.9	758.4	746.5		349.6	247.9
Secondary processing & other	106.5	100.7	92.7	92.4	116.7		48.6	54.1
Total	6,310.9	4,651.7	5,079.4	6,448.0	6,640.0		3,334.1	2,709.6

==> picture [45 x 44] intentionally omitted <==

40

Income Tax Ex ense – 1H FY20 p

A$m	Loss Before Tax	Income Tax Benefit /(Expense)	Effective Tax %
Statutory Result	(102.7)	11.6	-11.3
Significant Items	72.0	(15.6)	21.7
Normalised Results	(30.7)	(4.0)	13.0

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41

Lease Standard Im act – 1H FY20 p

A$m	EBIT	EBITDA
Underlying Result	(23.2)	74.9
Lease Depreciation	N/A	31.2
Lease Interest Expense	2.3	2.3
Underlying Result Excluding Lease Standard Impact	(25.5)	41.4

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42

Si nificant items g

A$m	1H FY19 Pre-Tax Total	1H FY19 After-Tax Total	1H FY20 Pre-Tax Total	1H FY20 After-Tax Total
Legacy brand write offs	-	-	14.6	11.0
Other intangible asset impairments	-	-	13.0	9.4
Restructuring and redundancies	0.1	0.1	33.6	26.9
Loss on sale of European compliance scheme operations, net of associated professional fees	-	-	3.2	2.9
Environmentalprovisions	-	-	11.0	8.2
Non-qualified hedges	(0.5)	(0.4)	1.9	1.9
Impact of fires, net of insurance recoveries to date	6.2	4.3	(5.3)	(3.9)
Non-recurring gain on asset disposition by joint venture	(5.1)	(3.8)	-	-
Significant Items for HY	0.7	0.2	72.0	56.4

A$m	1H FY20
Statutory EBIT	(95.2)
Significant Items	70.1
Non qualifying hedges	1.9
Underlying EBIT	(23.2)

A$m	1H FY20
Statutory NPAT	(91.1)
Significant Items	54.5
Non qualifying hedges	1.9
Underlying NPAT	(34.7)

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43