A five-year plan has been announced by Sims Metal Management with the intention of growing earnings by 350 per cent compared to 2013.
New group chief executive Gladino Claro has reviewed the company and decided on a plan that has already seen the closure of a substantial part of Sims Recycling Solutions in the UK and all of the same business in Canada.
He said: “We have completed a comprehensive review of the global operations of Sims Metal Management and developed a plan which will significantly improve operational performance and earnings, without relying on cyclical recovery or acquisitions. Sims Metal Management is a great business operating in a growing industry. This renewed focus on our strengths and competitive position will set us up well to capitalise on future growth opportunities for the benefit of our customers, employees and shareholders.
“Our five-year plan includes three key stages of streamlining, optimising and growth, and we are already seeing the initial benefits where we have begun implementation. We expect streamlining actions, through our cost reductions and exiting loss making businesses, will generate $32 million in EBIT benefits, with 50 per cent to be achieved in FY15 and fully realised during FY16.
“As we streamline our portfolio we will develop operations where we can best leverage our key competitive advantages of scale, export positioning, and the largest global trading relationship network in the industry.
“We also see significant scope to further improve our position in both the global metal recycling and electronic recycling businesses. As a company which has grown largely through a long history of acquisitions, we have not yet fully realised the inherent synergies of these transactions. Through sharing best practices across our global footprint and focusing the business back to our core drivers of profitability, I believe significant value and earnings improvements can be generated.”