Sims Metal Management's (SMSMY) CEO Galdino Claro on Q2 2. Results - Earnings Call Transcript.
Sims Metal Management Ltd (ADR) (OTCPK: SMSMY)Q2 2. Earnings Conference Call. February 1. 8, 2.
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PM ETExecutives. Todd Scott - VP, Investor Relations. Galdino Claro - Group CEOFred Knechtel - Group CFOSteve Shinn - President, North American Metals Waste Region. Alistair Field - Managing Director, Australian & New Zealand Metals. Bill Schmiedel - President, Global Trade Division. Analysts. Scott Hudson - CLSAEmily Smith - Deutsche Bank. Jon Clarke - Maple- Brown Abbott. Peter Stein - Macquarie.
Ramoun Lazar - UBSJohn Hyde - Merrill Lynch. James Rutledge - Morgan Stanley. Mason Thomas - Australian Ethical Investment\Simon Thackray - Citi. Michael Slifirski - Credit Suisse. Hugh Stackpool - JP Morgan. Todd Scott. Thank you, good morning everyone here in Sydney.
Sims Crane & Equipment is Florida’s premier crane rental and rigging service. Founded in 1959, Sims Crane & Equipment Co.
If you're listening on Webcast welcome to the first half fiscal 2. Sims Metal Management. Just a few housekeeping issues before we get started. I'd like to remind you that today's presentation may contain forward- looking statements, including statements including financial condition, results of operations, earnings outlook and prospects for Sims Metal Management Limited. Also just as a reminder, Sims is domiciled in Australia, all references to currency are in Australian dollars unless otherwise noted. The agenda for today's presentation will start with an overview of the first half results presented by Group CEO Galdino Claro and Group CFO Fred Knechtel.
Following which Galdino will present an overview of the business resetting actions the company is currently undertaking, assisting in this portion of the presentation there are several members of the Executive Leadership Team. With us today are Steve Shinn, President of the North American Metals Waste Region, Alistair Field, Managing Director for the Australian & New Zealand Metals Business and Bill Schmiedel, President of the Global Trade Division. We will also hold several external industry advisory positions including on the Steel Committee of the London Metal Exchange and as President of the First Division at the Bureau of International Recycling. Lastly, Galdino will close with the a few comments on current conditions and outlook for the business including with our question- and- answer- session.
I will now like to pass the presentation over to Mr Galdino Claro. Galdino Claro. Thank you Todd and good morning. The recycling industry is under significant pressure. It's facing extreme challenges unseen since the early 1. However, we have seen these conditions before and as orders are failing we are taking this opportunity to strengthen the basis of our leadership position in the industry. Our balance sheet is strong.
We have a clear strategy in place to improve performance and a highly motivated team working hard to continuously lower our breakeven point via improving margins and reducing controllable costs. In leveraging our best in class assets with your objective of generating an above cost of capital return for our shareholders based on clearly identified initiatives under our control. We are more confident than ever in our strategy and we are here together today to restate our commitment to take Sims to an above cost of capital return by the end of fiscal year 2. It's hard to predict when the English Recycle will recover. But history proves it will. When it does we are the best placed company to take advantage of the enormous earning potential this industry can deliver. Today's presentation will cover four key areas.
The market conditions we faced in the first half and we will move to how these conditions impacted our financial performance and how we react to them. Third point will be how we are resetting the business to deliver attractive return in year terms, while creating a strong foundation for future growth. And lastly, we will talk about what we expect in our market outlook.
So please now turn to the next slide. Current head winds have put many of our peers in survival mode. Since the beginning of fiscal year 2. North America alone, in the US alone. Facing the toughest conditions indicates in the first quarter of fiscal year 2. But before the referee start counting, we got up and went back into the fight.
Culture Sims Global Trade markets materials from various company owned scrap processing locations in North America, Australia, New Zealand, and the UK. Additionally, Sims buys materials from independently owned suppliers and producers in the United. Sims Metal Management Limited announced Thursday that Tobin Pospisil has joined the Company as President of Sims Metal Management North American Metals, Central Region, covering the Midwestern, Southern and Southwestern United States. Rooted in Growth Home Products Media Contact Our Team – Craig Stuart. Sims Metal Mgmt North Amer Trd 630 N North Ct Palatine IL 60067 Reviews (847) 776-7467 Menu & Reservations Make Reservations Order Online Tickets Tickets See Availability Nearby Directions ! Thank you for being a.
In quarter two was already profitable. At the same time we improved the business and start returning capital to the shareholders. We rapidly put in place actions to reset the business to a lower cross base.
During half year 2. A$5. 7 million in controllable costs from the business, while reducing head count and exiting underperforming operations.
Our net cash balance sheet grew to a record of A$3. In an industry, where many of our peers are facing bankruptcy, our strong balance sheet is a meaningful competitive advantage. With our growing cash balance we are able to return capital to shareholders taking advantage of the current share price, we initiate an up to 1. December. So far we purchased 3 million shares with an up to a further 1. So let me now pass the presentation to Fred for the details on our financial performance, Fred please. Fred Knechtel. Thank you Galdino.
I begin with the discussion on external operating conditions then review our first half operating performance and finish with an update on our capital management strategy. Global economic growth concerns, steel overproduction, record Chinese exports and the strong US dollar caused metal prices to fall sharply across both ferrous and non- ferrous commodities. Export ferrous scrap prices declined 3. Nonferrous commodity prices declined significantly, copper declined 2.
The Australian dollar also weakened. It is down 1. 9% to the US dollar, 5% to the Euro and 1. British Pound compared to the first half of last year. These economic factors have contributed to weaker scrap demand and lower prices have dramatically hampered ferrous intake volume.
Sales volume was 1. This sharp decline in volume has put tremendous pressure on our fixed cost base.
We believe that current market conditions will persist for the foreseeable future and that resetting actions are required to match our fixed cost base to these lower activity levels. As shown on slide five we incur charges of A$2. A$1. 19 million related to our investment in SA Recycling, A$4. Global E- Recycling goodwill and A$8. Following a write down A$1.
A$6. 6 million of other intangible assets remain on the balance sheet. In the evaluation of these intangible assets, it was determined that no further impairments would be required. However if market conditions deteriorate then further impairments may be identified.
Underlying EBIT loss, excluding significant items, was A$4. Underlying EBITDA with A$6. Working capital declined by A$1. Capital spending was A$4. PMO optimizing initiatives, and as always safety, environmental and maintenance. Our gross cash balance improved to A$3.
Looking at the business performance on slide six. Lower metals prices and resulting lower volume, negatively impacted every business, resulting in a A$4. EBIT loss. Several loss making assets were identified to be divested. These assets generated a loss of A$2. Excluding these operations to be discontinued underlying EBIT was A$1.
We are in the advanced stages of rationalizing these assets and expect that these assets will be divested by the end of the second semester. We did make progress resetting the business in the first half. We are currently evaluating additional actions to be executed in the second half and these actions may require additional restructuring charges. North America Metals underlying EBIT loss of A$2. While the East and West regions of North America remain profitable, the losses were concentrated in the Central region, bulk stainless and SA Recycling joint venture. Australia and New Zealand's profit decline 1.
Europe Metals EBIT declined to A$2 million due to lower domestic sales volume in the first quarter, however performance recovered in the second quarter as sales shifted to export markets. Global E- Recycling's EBIT declined significantly, impacted by lower commodity prices and fixed price supplier contracts. On slide seven the primary driver of lower first half earnings was a significant drop in ferrous sales volumes.
Lower nonferrous metal margin and commodity price impacts on E- Recycling. Ferrous volume was down 2. The decline in non- ferrous metals pricing negatively impacted metal margins across both Metals Recycling and E- Recycling. However, considering the sharp drop in ferrous prices, maintaining steady ferrous margins was a significant accomplishment. Controllable costs was reduced by A$5.
A result of our rapid business resetting actions and without these actions, first half losses would have been much greater. Lower earnings in other primarily relates to our SA Recycling joint venture.
In the evaluation of quarterly performance, on slide eight, lower volumes continue to impact earnings in the second quarter. Offset by improved metal margins and resetting initiatives resulting in positive EBIT. E- Recycling and SA Recycling continued to pressure profitability.
Before I turn over the discussion to Galdino, I would like to review our capital management strategy on the next slide. Our first priority, at this point in the cycle, is to maintain a strong balance sheet to finance future working capital from volume or price recovery and new business opportunities. Second, invest back into the business to support the existing asset base and support PMO optimizing initiatives. And third, finance expansion opportunities. After these priorities are satisfied, we will return capital to shareholders to share buyback and dividends. Galdino. Galdino Claro.
Thanks Fred. We reacted to the deteriorating conditions of the first quarter with confidence and with sense of urgency. We have stabilized the business and returned profitability. But to achieve our return on capital target by fiscal year 2.
The Sims 3: Pets - Wikipedia. The Sims 3: Pets is the fifth expansion pack for The Sims 3 on PC and Mac, and is the second console game in the series.
It was released on October 1. North America. Like in previous expansions for The Sims games, this expansion introduces pets such as cats and dogs and, for the first time, horses into the game.
Development. The player creates their pet in a similar fashion to the 'Create A Sim' feature. The 'Create A Pet' feature allows the player to customise their pets in various ways, including selecting a breed and a set of traits for their pets.
Unlike in The Sims 2: Pets and The Sims: Unleashed, the player can directly control pets. Pets, unlike Sims, do not have jobs (unlike in The Sims 2: Pets) or a 'lifetime wish'. Included in the expansion pack is a new town 'Appaloosa Plains'. The limited edition of The Sims 3 Pets, which must be pre- ordered, includes a pet shop which will not be included in the normal edition of the game. The demonstration contained parts of the game that had never been seen before by the public.
The event took place on Wednesday June 8, 2. UTC. In their E3 hands- on preview with the Pet Creator Tool, Game. Marshal was able to uncover that your pets can mate and produce off- spring, although no cross- species breeding is allowed, genetics would be passed down to pet offspring, and you'll be able to assign unique characteristics to your pets. The new town comes with every building in the base game, as well as new stores and shops. In the Limited Edition, the town also comes with a pet store.
Every pet will have its own special needs. Sims can also play with laser pointers for playing with cats. Unicorns, if found, in the game are magical and can be added to a sim's household. They can set things on fire, teleport, curse or bless sims. They can breed with both unicorns and horses.
Dogs can swim in swimming pools, but they can not drown, as pets can only die by old age. A user can have up to 6 pets in one household.
This also extends the maximum amount of sims in a household from 8 to 1. There are new professions for sims such as . Pets also comes with wildlife, but they cannot be added to households. Players can use their horses as a form of transportation. Sims can adopt and bathe pets.
They can also have dogs and cats go around town and sniff for collectables. These collectables can be sold or stored in terrariums.
Cats and dogs can learn to hunt, dogs can learn to locate collectibles, and horses can learn racing and jumping. There are over a hundred breeds of dogs and cats.
Players may have a poodle with short hair, or you may also have a Poodle with Dalmatian spots. They can try to have puppies, kittens, or foals, and will also have family trees. Players can adopt horses and train them to run in races. The PC version will be bundled in a package with the base game as The Sims 3 Plus Pets. There are three main Pets which can be further customized in create a pet mode. These pets are the usual cats and dogs, also, there is a new addition to the game which are horses. In The Sims 3 Pets, there are many more pets that you can collect such as birds, snakes and mice.
There is the occasional raccoon which tips over your dustbin and a Deer which can only be watched or pet. At night, there are unicorns which appear and can be interacted with. However, these will disappear in the morning. Create a Pet. Create a Pet and Create a Sim are all in one mode, with different dressing room backgrounds. Players can customize the pet.
They can change the ears, tail, snout, eyes, and much more. Pets allows players to go even further than customizing their pet. A pet's behavior patterns and traits are also fully customizable. There is also an Advanced Mode for the Create a Pet mode.
In it, users can put different layers on the body of their pets, such as dots and/or stripes. There is no height slider for pets, due to animation conflicts in the game. Players not only get to choose the dominant pattern but they also get to pick an accessory pattern and both can be colored.
In horses, the mane and tail color are independent of the main color of the horse. Players can also add colorful markings on their fur and slide them around on their Sims' pets bodies.
Sims who are giving them away will also put an advertisement in the newspaper. Sims will occasionally encounter stray dogs. These dogs can be befriended and adopted by the player.
Most popular dog breeds are offered in the game. Breed has nothing to do within gameplay except the appearance of offspring. The reinforcement social system is used to correct bad behaviors and to praise good ones. Getting by with no punishment for bad behavior can lead a dog to take on that trait. Both dogs and cats can obtain fleas while outdoors.
These make them very uncomfortable, and they can pass them to other pets and sims. When grown up, adult dogs can learn tricks, guard the house, and hunt for objects. They can be taught six tricks: sit, sit up, play dead, roll over, speak, and shake. Dogs can also be taught to hunt.
They cannot learn on their own, but if taught, they can sniff out gems, metals and bones. The breed of cats does not matter in gameplay, although many popular breeds are also offered.
Scolding and praising a cat will influence the traits it will develop. Like dogs, cats can also hunt. Cats can learn how to hunt using a toy from the animal toy box, unlike dogs, they cannot be taught to hunt by their owners. Cats can hunt small pets. Unlike dogs, they cannot sniff out gems, bones, or metals, but have the ability to fish. Horses can be created with the household, adopted using a computer or telephone, or bought from the Equestrian Center.
Horses usually die of old age, but fires and meteors can kill them as well. The Jockey is the sole horse related Lifetime Wish in the Pets expansion. To accomplish it, the player will need to max the riding skill as well as earn 4. Horse breeds do not affect sale price. Horses can learn two skills - racing and jumping. Wild horses appear in herds (usually of two or three, depending on neighborhood size) in home neighborhoods, but not in exotic destinations such as Champs Les Sims.
Wild horses can be befriended. It's easier to befriend them if the Sim has a high (hidden) Wildlife skill.
Horses are the first non- . Horses and unicorns can breed together, with a chance of the offspring also being a unicorn. Unlike cats or dogs in the game, horses can be sold. The higher the horse's skills and the more money they have earned racing means a larger amount of money they can be sold for.
Elderly horses can be sold. Horses can ONLY be found in the PC/Mac version of the Pets Expansion Pack. It is set to be a ranch style town with new farm and barn style items in Build and Buy mode. The new location is set in a beautiful Midwestern ranching town nestled between lush green hills, where players can let their dogs and cats run loose in the park or spend time riding horses at the equestrian center.
Players will be able to build their own stable on residential lots. There is also a small Dive Bar, however it requires the Late Night expansion pack. Appaloosa Plains was a cowboy ranch town in the Midwest of the United States on the edge of the highway, and is named after the Appaloosa breed of horse. On the edge of the town can be found a dinosaur skeleton where dogs can collect bones and search for treasure. At one point Appaloosa Plains was a sleepy ranching township, its only claim to fame being a garish tourist trap that drew in the occasional passerby. However, a recent influx of city slickers has turned the area into a bustling hub of activity. They keep arriving with their stacks of Simoleons, retrofitting the town with modern amenities while eagerly believing they've acquired their own slice of country paradise.
The clash between the old and new is readily apparent, with some elderly die- hards clinging to the remaining vestiges of life as they knew it. Will the town come together in the new era of prosperity, or will the generational clash leave a clear line drawn in the sand?
Pet Traits. However, unlike regular Sims, a player can only select up to 3. Sims can train their pet behaviors through the pet doing related action to the trait or praising/scolding them. If the pet has been trained well enough they can develop a . The difference between the usual pet trait is a highlighted green box around the trait icon.
Trained traits can be lost if a Sim trains their pet the opposite behaviors. It is possible for a pet to have more than 5 traits. Since Horses are not featured in the console version, all pet traits that are exclusive for horses will not be available on the console version. Pets created in Create a Pet can have up to 3 traits.
If the player buys the Attitude Adjustment Lifetime reward they can add 2 more traits, in which the total number of traits is 5. If a pet with more than 5 traits moves to another world, they will lose all their . Only the first 5 traits on the pet's bio list will still remain. Reception. There are also some problems regarding glitches in the game. Some reported are, problems creating a pet, problems involving graphics, and frequent crashing. Archived from the original on June 7, 2.
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