Q4 2026 Sims Ltd Earnings Call

August 18, 2026

Speaker #1: Thank you for standing by, and welcome to the Sims Limited FY26 results call. All participants are in a listen-only mode, followed by a question-and-answer session. If you wish to ask a question, you will need to press the star key, followed by the number 1 on your telephone keypad.

Operator: Thank you for standing by, and welcome to the Sims Limited FY2026 results call. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number 1 on your telephone keypad. Today's presentation has been lodged with the ASX along with the results release. It may contain forward-looking statements, including statements about financial conditions, results of operations, earnings outlook, and prospects for Sims Limited. These forward-looking statements are subject to assumptions and uncertainties. Actual results may differ materially from those experienced or implied by these forward-looking statements. Those risk factors can also be found on the company's website, www.simsltd.com. As a reminder, Sims Limited is domiciled in Australia, and all references to currency are in Australian dollars unless otherwise noted.

Speaker #1: Today's presentation has been lodged with the ASX, along with the results release. It may contain forward-looking statements, including statements about financial condition, results of operations, earnings outlook, and prospects for Sims Limited.

Speaker #1: These forward-looking statements are subject to assumptions and uncertainties. Actual results may differ materially from those experienced or implied by these forward-looking statements. Those risk factors can also be found on the company's website, www.simsltd.com.

Speaker #1: As a reminder, Sims Limited is domiciled in Australia, and all references to currency are in Australian dollars unless otherwise noted. I would now like to hand the conference over to Stephen Mikkelsen, Group CEO and Managing Director of Sims Limited.

Operator: I would now like to hand the conference over to Stephen Mikkelsen, Group CEO and Managing Director of Sims Limited. Please go ahead.

Speaker #1: Please go ahead.

Speaker #2: Thank you, and good morning from Sydney. Presenting with me today is Warrick Ranson, our CFO. Rob Thompson, our Global President for the Metal Business, is also in the room, and I'm sure we will hear from Rob during the Q&A session.

Stephen Mikkelsen: Thank you, and good morning from Sydney. Presenting with me today is Warrick Ranson, our CFO. Rob Thompson, our Global President for the Metal business, is also in the room, and I am sure we will hear from Rob during the Q&A session. We will follow our normal run-through with me providing an initial overview of the results and market conditions. Warrick will take us through the numbers in more detail, and then I will return to talk about our strategic position and outlook. That should leave us plenty of time for questions. I will turn straight to slide 5, which looks at our strategy and strategic priorities. The fundamentals of our strategies have not changed: to repurpose and recycle. We have, however, updated the left-hand part of this slide to reflect the significant growth in importance of SLS to our overall business. A couple of examples.

Speaker #2: We will follow our normal run-through, with me providing an initial overview of the results and market conditions. Warrick will take us through the numbers in more detail, and then I will return to talk about our strategic position and outlook.

Speaker #2: That should leave us plenty of time for questions. I will turn straight to slide 5, which looks at our strategy and strategic priorities. The fundamentals of our strategy have not changed.

Speaker #2: To repurpose and recycle. We have, however, updated the left-hand part of this slide to reflect the significant growth in importance of SLS to our overall business.

Speaker #2: A couple of examples: under Customers, we now specifically call out Deepen Hyperscale Partnerships. And under the heading of Innovative and Agile, we now include the importance of R&D for SLS to capitalize on opportunities from the next generation of technologies.

Stephen Mikkelsen: Under customers, we now specifically call out deepen hyperscale partnerships. Under the heading of innovative and agile, we now include the importance of R&D for SLS to capitalize on opportunities from the next generation of technologies. Consistently delivering on this strategy over the last 3 years has underpinned the EBITDA performance shown on this slide. All divisions, with the exception of ANZ, which has been impacted by factors external to its control, are up significantly on last year. I am very pleased to report a return on invested capital above our cost of capital. Turning to slide 6. Another very good year of safety performance with our total recordable injury frequency rate at 1.09. These results could not be achieved without the buy-in from our employees, and you can see this in the excellent completion rates of our lead indicator safety metrics.

Speaker #2: Consistently delivering on this strategy over the last three years has underpinned the EBITDA performance shown on this slide. All divisions, with the exception of ANZ—which has been impacted by factors external to its control—are up significantly on last year.

Speaker #2: And I'm very pleased to report a return on invested capital above our cost of capital. Turning to slide 6: another very good year of safety performance, with our total recordable injury frequency rate at 1.09.

Speaker #2: These results could not have been achieved without the buy-in from our employees, as reflected in the excellent completion rates of our lead indicator, Safety Metrics.

Speaker #2: A couple of other points to note on this slide. Firstly, it can be easy to forget the significant contribution we make to reducing greenhouse gases.

Stephen Mikkelsen: A couple of other points to note on this slide. Firstly, it can be easy to forget the significant contribution we make to reducing greenhouse gases. As the global economy transitions toward net zero, circular solutions such as recycling are becoming increasingly important. By recycling 5.9 million tons of ferrous, we helped avoid more than 9.5 million tons of greenhouse gas emissions measured in CO2 equivalent. That is approximately 1.6 times our combined scope 1, 2, and 3 emissions. The final point I will highlight is that our pay equity gap percentage has fallen to under 2%. 5 years ago, we had a pay equity gap of over 9%, so it is very pleasing to see the progress. Moving briefly on to slide 7, as the detail behind this slide is covered later on.

Speaker #2: As the global economy transitions toward net zero, circular solutions such as recycling are becoming increasingly important. By recycling 5.9 million tons of ferrous, we helped avoid more than 9.5 million tons of greenhouse gas emissions, measured in CO2 equivalent.

Speaker #2: That is approximately 1.6 times our combined Scope 1, 2, and 3 emissions. The final point I'll highlight is that our pay equity gap percentage has fallen to under 2%.

Speaker #2: Five years ago, we had a pay equity gap of over 9%, so it's very pleasing to see the progress. Moving briefly onto slide 7, as the detail behind this slide is covered later on.

Speaker #2: In our metal business, we grew unprocessed scrap by 2 percentage points, which helped lift our shredder utilization by 5 percentage points. SLS had significant growth across the entire business, including a 91% growth in repurposed units.

Stephen Mikkelsen: In our metal business, we grew unprocessed scrap by 2 percentage points, which helped lift our shredder utilization by 5 percentage points. SLS had significant growth across the entire business, including a 91% growth in repurposed units. Warrick Ranson is going to cover financial performance in detail, so I am only going to make a couple of overall comments on slide 8. It has been a very good year for Sims. Underlying EBIT is up nearly 170% to AUD 468 million, and this has fed through to our return on invested capital reaching 11.7%, which is comfortably above our cost of capital. I know return on capital has been a focus for our shareholders for a number of years, so it is pleasing to see our strategy delivering.

Speaker #2: Warrick is going to cover financial performance in detail—sigh—I’m only going to make a couple of overall comments on slide 8. It has been a very good year for Sims.

Speaker #2: Underlying EBIT is up nearly 170% to $468 million, and this has fed through to our return on invested capital reaching 11.7%, which is comfortably above our cost of capital.

Speaker #2: I know return on capital has been a focus for our shareholders for a number of years, so it is pleasing to see our strategy delivering.

Speaker #2: This significant lift in performance has been delivered through positioning SLS as a world leader in data center refresh and decommissioning services, focusing on buying unprocessed scrap and upgrading it to more valuable products through excellent operating capabilities, selling into the best available markets, and managing costs.

Stephen Mikkelsen: This significant lift in performance has been delivered through positioning SLS as a world leader in data center refresh and decommissioning services, focusing on buying unprocessed scrap and upgrading it to more valuable products through excellent operating capabilities, selling into the best available markets, and managing costs. The next four slides look at the state of the markets in which we operate, starting with the memory market on slide 9. These two very simple charts tell the story. Firstly, on the left, you can see the decline in new production of DDR4s. At the same time, you can see the rapid rise in DDR5 production as manufacturers have switched from DDR4 to higher-margin DDR5 chips in an effort to meet the insatiable appetite for memory driven by AI. This has resulted in two very positive implications for SLS.

Speaker #2: The next four slides look at the state of the markets in which we operate, starting with the memory market on slide 9. These two very simple charts tell the story.

Speaker #2: Firstly, on the left, you can see the decline in new production of DDR4s. At the same time, you can see the rapid rise in DDR5 production, as manufacturers have switched from DDR4 to higher-margin DDR5 chips, in an effort to meet the insatiable appetite for memory driven by AI.

Speaker #2: This has resulted in two very positive implications for SLS. Firstly, as DDR4 production has declined, the price of new DDR4s has increased significantly, which is clearly shown in the chart on the right.

Stephen Mikkelsen: Firstly, as DDR4 production has declined, the price of new DDR4s has increased significantly, which is clearly shown in the chart on the right. The demand for DDR4s hasn't gone away, so the requirement for used DDR4s has also increased dramatically, driving those prices up as well. Secondly, the enormous amount of installed DDR5s will need to be refreshed over the coming years and also repurposed, either back in the data centers or sold into the used market. This provides many years of repurposing opportunities for us, and we are well-positioned to capture those opportunities. While the medium and long-term implications of massive data center expansions are clearly positive for SLS, we are seeing a short-term variability in the refresh cycles, and this is presented on slide 10. Firstly, on the right-hand side, there is a bar chart showing the annual investment in data centers.

Speaker #2: The demand for DDR4s hasn't gone away, so the requirement for used DDR4s has also increased dramatically, driving those prices up as well. Secondly, the enormous amount of installed DDR5s will need to be refreshed over the coming years, and also repurposed.

Speaker #2: Either back into data centers, or sold into the used market. This provides many years of repurposing opportunities for us, and we are well positioned to capture those opportunities.

Speaker #2: While the medium- and long-term implications of massive data center expansions are clearly positive for SLS, we are seeing short-term variability in the refresh cycles.

Speaker #2: And this is presented on slide 10. Firstly, on the right-hand side, there is investment in data centers. Importantly, around 60% of total spend is on compute infrastructure, including servers, chips, networking equipment, and related technology.

Stephen Mikkelsen: Importantly, around 60% of total spend is on compute infrastructure, including servers, chips, networking equipment, and related technology. Right now, the infrastructure capacity to build these data centers is under significant pressure. There are a few bottlenecks causing delays, with a significant one being the availability of both the electrical connection and then the electricity itself. This, in turn, has caused variability in when existing data centers are ready to be refreshed, particularly when they also need electrical capacity upgrades. It is important to note that this impacts timing of refresh cycles, not whether the refresh will actually happen. Moving on to the metal markets, and firstly, non-ferrous on slide 11. The structural drivers have been strong for 2 years now, and our view is that these drivers will remain. Just to highlight 2 or 3 of those drivers.

Speaker #2: Right now, the infrastructure capacity to build these data centers is under significant pressure. There are a few bottlenecks causing delays, with a significant one being the availability of both the electrical connection and then the electricity itself.

Speaker #2: This, in turn, has caused variability in when existing data centers are ready to be refreshed, particularly when they also need electrical capacity upgrades. It is important to note that this impacts the timing of refresh cycles, not whether the refresh will actually happen.

Speaker #2: Moving on to the metal markets, and firstly non-ferrous on slide 11. The structural drivers have been strong for two years now, and our view is that these drivers will remain.

Speaker #2: Just to highlight two or three of those drivers: AI infrastructure requires copper and aluminium, driving those commodity prices up, which also benefits silver prices.

Stephen Mikkelsen: AI infrastructure requires copper and aluminum, driving those commodity prices up, which also benefits silver prices. The electrification of the world continues at pace, requiring conductive materials such as copper and aluminum. Looking at the chart on the right, you can see the growing gap between US aluminum prices and the LME, largely driven by US tariffs. We are nicely exposed to these higher prices through our US metal businesses. It is also worth noting that on a number of occasions, due to our market expertise, we have sold non-ferrous from ANZ into the US and have been able to absorb the tariff. Turning now to ferrous on slide 12. The headline captures the market dynamics. In the US, we have tariffs protecting the steel industry and encouraging the reshoring of manufacturing. This has lifted margins in steel manufacturing and is driving investment in EAF.

Speaker #2: The electrification of the world continues at pace, requiring conductive materials such as copper and aluminum. Looking at the chart on the right, you can see the growing gap between U.S. aluminum prices and the LME, largely driven by U.S. tariffs.

Speaker #2: We are nicely exposed to these higher prices through our US metals businesses. And it is also worth noting that, on a number of occasions, due to our market expertise, we have sold non-ferrous from AMZ into the US and have been able to absorb the tariff.

Speaker #2: Turning now to ferrous on slide 12. The headline captures the market dynamics. In the US, we have tariffs protecting the steel industry and encouraging the reshoring of manufacturing.

Speaker #2: This has lifted margins in steel manufacturing and is driving investment in EAFs. Data center construction is also boosting demand for steel. Both NAM and SAR are well positioned for this market structure and the increased demand for ferrous material.

Stephen Mikkelsen: Data center construction is also boosting demand for steel. Both NAM and SA Recycling are well-positioned for this market structure and the increased demand for ferrous material. ANZ continues to be impacted by Chinese exports, although there has been an overall modest improvement. At a very local level, the shuttering of Whyalla has increased domestic demand for ferrous scrap. I will hand over to Warrick now to take us through the financials.

Speaker #2: AMZ continues to be impacted by Chinese exports, although there has been an overall modest improvement. At a very local level, the shuttering of Walla has increased domestic demand for ferrous scrap.

Speaker #2: I'll hand over to Warrick now to take us through the financials.

Speaker #3: Good morning, everyone. So, Stephen mentioned global scrap markets for the 2026 financial year reflected a number of dynamics. While the ongoing shift toward electric arc furnaces fuels steady buying in a number of regions, broader commercial construction activity remains soft, outside of data center development.

Warrick Ranson: Good morning, everyone. As Stephen mentioned, global scrap markets for the 2026 financial year reflected a number of dynamics. While the ongoing shift toward electric arc furnaces fueled steady buying in a number of regions, broader commercial construction activity remained soft outside of data center development. Regional restrictions and stricter trade controls tightened cross-border supply chains. However, elevated Chinese steel exports, despite some production rationalization, continued to dampen Asian and Middle East buying, with demand from Türkiye remaining soft as buyers switched to cheap Chinese and Russian billet late in the year. At the same time, we saw copper prices surge, driven by a relentless demand for AI-related activities, green energy grids, and EV infrastructure, and hit record highs in the year. Tight primary ore supplies and tariff expectations further amplified bidding for secondary copper.

Speaker #3: Regional restrictions and stricter trade controls tighten cross-border supply chains; however, elevated Chinese steel exports, despite some production rationalization, continue to dampen Asian and Middle East buying, with demand from Turkey remaining soft, as buyers switch to cheap Chinese and Russian billet late in the year.

Speaker #3: At the same time, we saw copper prices surge, driven by a relentless demand for AI-related activities, green energy grids, and EV infrastructure, and hit record highs in the year.

Speaker #3: Tight primary oil supplies and tariff expectations further amplified bidding for secondary copper. Similarly, geopolitical conflict in the Middle East created primary aluminium supply crunches, pushing global buyers toward aluminium scrap substitution and boosting values despite regional trade friction.

Warrick Ranson: Similarly, geopolitical conflict in the Middle East created primary aluminum supply crunches, pushing global buyers towards aluminum scrap substitution and boosting values despite regional trade friction. Zorba pricing peaked across May and June as a result, adding significantly to our overall financial performance for the year. As we noted at the H1, with both export and domestic markets exposed to global scrap dynamics, we continued to leverage the arbitrage in our key domestic and international markets and sold volume proactively between the two to maximize margins. Again, reflecting the significant agility and flexibility embedded within both our inbound and outbound logistic chains. Concurrently, our total repurposed units handled this year was nearly double the prior year's volume.

Speaker #3: Silver pricing peaked across May and June as a result, adding significantly to our overall financial performance for the year. As we noted at the half, with both export and domestic markets exposed to global scrap dynamics, we continue to leverage the arbitrage in our key domestic and international markets, and sell volume proactively between the two to maximize margins.

Speaker #3: Again, reflecting the significant agility and flexibility embedded within both our inbound and outbound logistic chains. Concurrently, our total repurposed units handled this year was nearly double the prior year’s volume.

Speaker #3: Prices for new DDR4 memory continued to increase exponentially, with our market reference price finishing the year over 1,000% above the prior year, as demand continued to increase against diminished supply, with manufacturing shortfalls and a focus on new-generation cards continuing to uplift repurposing and resale activities.

Warrick Ranson: Prices for new DDR4 memory continued to increase exponentially with our market reference price finishing the year over 1,000% above the prior year as demand continued to increase against diminished supply with manufacturing shortfalls and a focus on new generation cards continuing to uplift repurposing and resale activities. Across the business, we continued to deliver disciplined cost-efficiency initiatives. Current activities such as moving to a global shared services platform and the operational changes now implemented for our Houston operations will continue to drive cost and performance improvements in the business. Our average metal fixed cost per intake ton fell as we capitalized further on existing infrastructure and improved material flows. I will come back and talk further about our cost performance shortly. Our statutory result reflects those targeted restructuring initiatives and a slightly lower number than what we had at the H1 for the write-down of the UK metal receivable.

Speaker #3: Across the business, we continue to deliver disciplined cost efficiency initiatives. Current activities, such as moving to a global shared services platform and the operational changes now implemented for our Houston operations, will continue to drive cost and performance improvements in the business.

Speaker #3: Our average metal fixed cost per intake ton fell as we capitalized further on existing infrastructure and improved material flows. I'll come back and talk further about our cost performance shortly.

Speaker #3: Our statutory result reflects those targeted restructuring initiatives, and the slightly lower number than what we had at the half for the write-down of the UK metal receivable.

Speaker #3: We've continued to pursue partial recovery options there where they exist, recouping around $17 million over the last six months. Pleasingly, I think we've just about stabilized our statutory to underlying position now and expect to see some consistency in this going forward.

Warrick Ranson: We have continued to pursue partial recovery options there where they exist, recouping around AUD 17 million over the last six months. Pleasingly, I think we have just about stabilized our statutory to underlying position now and expect to see some consistency in this going forward. Speaking of underlying and moving to slide 15. I have touched on the principal drivers of most of these already. June was a particularly strong month, surprising us on the upside, and we were able to move additional volume at attractive spreads. Importantly, that outcome reflected not only favorable market conditions, but also the capability we have built to respond quickly, manage logistics effectively, and place material into the highest value channel available at the time. While market conditions clearly provided support in a number of areas, the more important point for us is that the business is demonstrating a stronger structural earnings base.

Speaker #3: Speaking of underlying, and moving to slide 15, I've touched on the principal drivers of most of these already. June was a particularly strong month, surprising us on the upside, and we were able to move additional volume at attractive spreads.

Speaker #3: Importantly, that outcome reflected not only favorable market conditions, but also the capability we have built to respond quickly, manage logistics effectively, and place material into the highest-value channel available at the time.

Speaker #3: While market conditions clearly provided support in a number of areas, the more important point for us is that the business is demonstrating a stronger structural earnings base.

Speaker #3: Lower unit costs, better network utilization, greater market optionality, and more disciplined capital allocation leave us better positioned to capture upside in favorable markets while maintaining resilience through commodity cycles.

Warrick Ranson: Lower unit costs, better network utilization, greater market optionality, and more disciplined capital allocation leave us better positioned to capture upside in favorable markets while maintaining resilience through commodity cycles. Focusing in on the individual businesses then, strong performances by both the NAM and SA Recycling businesses absorbed the impact of the continuing market pressures on ANZ. Global trade reverted to its previous levels as broker tonnage reduced following the winding up of Unimetals in the UK. This year's result effectively represents the cost base of our trading activities to the business. June itself was an exceptional month for the metal business, surpassing initial expectations from early in the month as ferrous margins strengthened from favorable market dynamics and non-ferrous volumes and Zorba pricing maintained their highs.

Speaker #3: Focusing in on the individual businesses, then, strong performances by both the NAM and SAR businesses absorbed the impact of the continuing market pressures on AMZ.

Speaker #3: Global trade reverted to its previous levels, as broker tonnage reduced following the lining up of uni-metals in the UK. This year's result effectively represents the cost base of our trading activities to the business.

Speaker #3: June itself was an exceptional month for the metal business, surpassing initial expectations from early in the month, as ferrous margin strengthened from favorable market dynamics, and non-ferrous volumes and silver pricing maintained their highs.

Speaker #3: Similarly, second-hand memory pricing achieved its highest level of the year on a gigabyte basis, albeit at a lower ratio to new prices, given the mix.

Warrick Ranson: Similarly, secondhand memory pricing achieved its highest level in the year on a gigabyte basis, albeit on a lower ratio to new prices given the mix. As Stephen has mentioned, we see some variability in inbound volumes as data center construction and decommissioning pipelines are consistently challenged by a range of external factors. However, we have deliberately built a flexible operating model, allowing us to adjust cost and activity levels with inbound volumes. I will expand on some of the other factors driving these various movements in subsequent slides. Moving to the metal business more specifically, and in North America, total intake volumes increased by 240,000 tons over the prior year as we again prioritized unprocessed material, increased shredder utilization, and improved margins. Intake volumes were also supported by stronger domestic steel demand and higher domestic ferrous prices.

Speaker #3: As Stephen has mentioned, we see some variability in inbound volumes, as data center construction and decommissioning pipelines are consistently challenged by a range of external factors.

Speaker #3: However, we have deliberately built a flexible operating model, allowing us to adjust cost and activity levels with e-inbound volumes. I'll expand on some of the other factors driving these various movements in subsequent slides.

Speaker #3: Moving to the metal business more specifically, and in North America, total intake volumes increased by 240,000 tons over the prior year, as we again prioritized unprocessed material, increased shredder utilization, and improved margins.

Speaker #3: Intake volumes were also supported by stronger domestic steel demand and higher domestic ferrous prices. Even though we increased the level of domestic shipments in the U.S., we continue to maintain full optionality over material placement for best value.

Warrick Ranson: Even though we increased the level of domestic shipments in the US, we continue to maintain full optionality over material placement for best value. While intake levels also added to comparative costs, the team were able to generate a number of offsets through further restructuring and productivity initiatives. Having Tri Coastal Trading in Houston is also now giving us the opportunity to better manage spreads in that region and lower the run rate cost base further. In ANZ, ferrous margins were again impacted by the subdued international market, which also flowed on to domestic pricing. Although we did see some demand benefit from that prolonged outage at Whyalla. Favorable non-ferrous prices provided overall revenue support and helped offset shredder downtime at our St Mary's operation in the first quarter.

Speaker #3: While intake levels also added to comparative costs, the team was able to generate a number of offsets through further restructuring and productivity initiatives. Having TCT in Houston is also now giving us the opportunity to better manage spreads in that region and lower the run-rate cost base further.

Speaker #3: In AMZ, ferrous margins were again impacted by the subdued international market, which also flowed onto domestic pricing, although we did see some demand benefit from that prolonged outage at Whyalla.

Speaker #3: Favorable non-ferrous prices provided overall revenue support and helped offset shredder downtime at our St. Mary's operation in the first quarter. Notwithstanding elevated consumable input costs, particularly in the areas of fuel and waste disposal, which we felt right across the business, net operating costs continue to be well controlled here, with most of the increase over the prior year related to trading currency losses, which, for accounting purposes, are classified into operating costs.

Warrick Ranson: Notwithstanding elevated consumable input costs, particularly in the areas of fuel and waste disposal, which we felt right across the business, net operating costs continue to be well controlled here, with most of the increase over the prior year related to trading currency losses, which for accounting purposes are classified into operating costs. Non-ferrous, and particularly Zorba pricing, provided our SA Recycling joint venture with a significantly elevated financial performance versus early June expectations. While ferrous intake reflected a record year following further small-scale acquisitions, the US tariff wall and the surging Zorba price ran through to the bottom line, enabling that business to close out the year extremely well. Our global trading platform was also able to keep its costs relatively flat, though saw reduced broker revenue following the cessation of trading activities for Unimetals in the UK early in the year, as I mentioned.

Speaker #3: Non-ferrous, and particularly silver pricing, provided our SAR joint venture with a significantly elevated financial performance versus early June expectations. While ferrous intake reflected a record year, following further small-scale acquisitions, the US tariff war and a surging silver price ran through to the bottom line, enabling that business to close out the year extremely well.

Speaker #3: Our global trading platform was also able to keep its costs relatively flat, though it saw reduced broker revenue following the cessation of trading activities for uni-metals in the UK early in the year, as I mentioned.

Speaker #3: Moving to SLS now, and Stephen's covered several of the drivers here already. As we've noted, the business has experienced significant growth in the number of repurposed units, demonstrating the broader strength of the market, as well as specifically benefiting from the dynamics of memory chip prices, with memory averaging around 30% of hyperscaler spend.

Warrick Ranson: Moving to SLS now, and Stephen has covered several of the drivers here already. As we have noted, the business has experienced significant growth in the number of repurposed units, demonstrating the broader strength of the market, as well as specifically benefiting from the dynamics of memory chip prices, with memory averaging around 30% of hyperscaler spend. We saw that pick up even further in the H2 as the impact of uplifted prices filtered through and repurposed volumes increased despite the industry's growing pains and planning volatility. Total memory sold on a gigabyte basis fell from prior year levels as DDR3 volumes reduced and we repurposed more 16-gigabyte cards in the H2. Improved unit costs were reflected by volume gains and expansion activities, and the team continues to look at additional opportunities around automation and robotics to support its cost management program.

Speaker #3: We saw that pick up even further in the second half, as the impact of uplifted prices filtered through and repurposed volumes increased, despite the industry's growing pains and planning volatility.

Speaker #3: Total memory sold on a gigabyte basis fell from prior year levels as DDR3 volumes reduced, and we repurposed more 16-gigabyte cards in the second half.

Speaker #3: Improved unit costs reflected both volume gains and expansion activities, and the team continues to look at additional opportunities around automation and robotics to support its cost management program.

Speaker #3: On slide 18, I want to quickly touch on the ongoing strength of the SLS business for us. While memory pricing has certainly been a primary contributor this year, the business is evolving into much more than that.

Warrick Ranson: On slide 18, I want to quickly touch on the ongoing strength of the SLS business for us. While memory pricing has certainly been a primary contributor this year, the business is evolving into much more than that. The structural shift in demand that we are seeing with both hyperscale and enterprise clients in response to this phase of what is effectively the fourth industrial revolution, is being matched by both their current need to source an array of components for growth, but also their recognition of the associated circular and economic benefits. Our deep relationships and proven scalability to respond to this demand in a secure, trusted, and certified manner provides us with confidence about the role that SLS can play in our earnings base going forward. Touching briefly on central and functional costs now. We continue to look for cost out efforts in this area.

Speaker #3: The structural shift in demand that we are seeing with both hyperscale and enterprise clients in response to this phase of what is effectively the Fourth Industrial Revolution is being matched by both their current need to source an array of components for growth, but also their recognition of the associated circular and economic benefits.

Speaker #3: Our deep relationships and proven scalability to respond to this demand in a secure, trusted, and certified manner provide us with confidence about the role that SLS can play in our earnings base going forward.

Speaker #3: Touching briefly on central and functional costs now, we continue to look for cost-out efforts in this area. This year, we relocated our corporate office to further reduce costs, as well as beginning the transition to a new global shared services hub as part of a more extensive shared services model being progressed over the next few years.

Warrick Ranson: This year, we relocated our corporate office to further reduce costs, as well as beginning the transition to a new global shared services hub as part of a more extensive shared services model being progressed over the next few years. Following stabilization of the company's SAP platform implementation, project costs fell by nearly AUD 5 million. Noting that we continue to incur costs in developing our new yard management software for metal, which we are aiming to commence the rollout of in Q2 this year. All of these initiatives are expected to contribute to lowering the ongoing cost base and improve consistency of execution. As previously advised, we elected to cease work on the development and commercialization of the plasma-assisted gasification technology that was being undertaken by Sims Resource Renewal during last year.

Speaker #3: Following stabilization of the company's SAP platform implementation, project costs fell by nearly $5 million. Note that we continue to incur costs in developing our new yard management software for metal, which we are aiming to commence the rollout of in Q2 this year.

Speaker #3: All of these initiatives are expected to contribute to lowering the ongoing cost base and improving consistency of execution. As previously advised, we elected to cease work on the development and commercialization of the plasma-assisted gasification technology that was being undertaken by Sims Resource Renewal during last year.

Speaker #3: This further reduced the central cost pool by some $10 million to $12 million per year, on a full-year basis. Just a heads up that in this area, commencing in the current financial year, we intend to allocate costs for centrally provided services that are currently unallocated out to the business, in order to provide a more comprehensive and focused approach to their management.

Warrick Ranson: This further reduced the central cost pool by some AUD 10 to AUD 12 million per year on a full year basis. Just a heads up that in this area, commencing in the current financial year, we intend to allocate costs for centrally provided services that are currently unallocated out to the business in order to provide a more comprehensive and focused approach to their management. This will, of course, result in changes in the comparative performance for the business segments and will provide additional color across this area as we approach the results for the half in the new year. At a group level, once again, able to keep total costs relatively flat over the period, limiting the increase to around 5% before variable costs and off that rebased comparative prior year.

Speaker #3: This will, of course, result in changes in the comparative performance for the business segments and will provide additional color across this area as we approach the results for the half in the new year.

Speaker #3: At a group level, once again able to keep total costs relatively flat over the period, limiting the increase to around 5% before variable costs, and off that re-based comparative prior year.

Speaker #3: Waste management costs continue to be a major contributor to our cost uplift each year, and we are progressing a number of targeted initiatives at extracting the residual metal in this waste and at reducing volumes to landfill in the future.

Warrick Ranson: Waste management costs continue to be a major contributor to our cost uplift each year, and we are progressing a number of targeted initiatives at extracting the residual metal in this waste and how we reduce volumes to landfill into the future. Variable operating costs increased in line with the increased volume of unprocessed material and higher repurposed units at SLS. We also experienced higher fuel costs as a result of those Middle East tensions. Labor, of course, remains our largest cost element at around 50% of operating costs, and ongoing labor cost efficiency initiatives continue to provide significant benefits in this area and in line with our previous cost-out commitments. While we remain focused on all cost opportunities, we maintain the view that our best way to drive further efficiencies in the business is through volume productivity gains and infilling our existing network.

Speaker #3: Variable operating costs increased in line with the increased volume of unprocessed material and higher repurposed units at SLS. We will also experience higher fuel costs as a result of those Middle East tensions.

Speaker #3: Labour, of course, remains our largest cost element, at around 50% of operating costs. Ongoing labour cost efficiency initiatives continue to provide significant benefits in this area, and are in line with our previous cost-out commitments.

Speaker #3: While we remain focused on all cost opportunities, we maintain the view that our best way to drive further efficiencies in the business is through volume productivity gains and infilling our existing network.

Speaker #3: We progressed some initial opportunities in this area over the last six months, in both A&Z and NAM, and expect to progress additional opportunities in this area during FY27, further improving returns from assets already in the portfolio.

Warrick Ranson: We progressed some initial opportunities in this area over the last six months in both ANZ and NAM, and expect to progress additional opportunities in this area during FY27. Further improving returns from assets already in the portfolio, capital expenditure was significantly higher in the H2 as we completed a number of planned initiatives across the business. Redevelopment of the Pinkenba site in Queensland continued with activities focused on site infrastructure and an extension of the wharf. We also progressed new fines and metal recovery plants across ANZ, including at Pinkenba and in Auckland, and expect to see the benefits of this flow through to the ANZ result in the current year following commissioning. We also completed our dredging program at Claremont at the beginning of the year, as well as several other productivity initiatives at that site.

Speaker #3: Capital expenditure was significantly higher in the second half, as we completed a number of planned initiatives across the business. Redevelopment of the Pinkenbar site in Queensland continued, with activities focused on site infrastructure and an extension of the wharf.

Speaker #3: We also progressed new finds and metal recovery plants across A and Z, including at Pinkenbar and in Auckland, and expect to see the benefits of this flow through to the A and Z result in the current year, following commissioning.

Speaker #3: We also completed our dredging program at Claremont at the beginning of the year, as well as several other productivity initiatives at that site. Other growth and productivity projects include extensions to rail capacity and network efficiency, together with small yard infill opportunities in both the East and West United States, as well as in Australia, to ensure we get more out of the network we already own.

Warrick Ranson: Other growth and productivity projects include extensions to rail capacity and network efficiency, together with small yard infill opportunities in both the East and West United States, as well as in Australia, to ensure we get more out of the network we already own. In February this year, outside of those smaller organic growth opportunities, we acquired the operations of Tri Coastal Trading in Houston to better position ourselves in that market. Total group depreciation and amortization, inclusive of leased assets, is currently forecast to be around AUD 260 million in FY27, consistent with the current year. The group completed the year with net book assets of AUD 2.7 billion at balance date, reflecting a stronger comparative Australian dollar at period end, dividend payments, and removing the Unimetals receivable.

Speaker #3: And in February this year, outside of those smaller organic growth opportunities, we acquired the operations of Tricoastal Trading in Houston to better position ourselves in that market.

Speaker #3: Total group depreciation and amortization, inclusive of leased assets, is currently forecast to be around $260 million in FY27, consistent with the current year. The group completed the year with net book assets of $2.7 billion at balance date, reflecting a stronger comparative Australian dollar at period end, dividend payments, and the removal of the Unimetals receivable.

Speaker #3: We recorded some $130 million in foreign currency translation differences this year from the stronger dollar, reducing our reported net asset backing in Australian dollar terms.

Warrick Ranson: We recorded some AUD 130 million in foreign currency translation differences this year from the stronger dollar, reducing our reported net asset backing in Australian dollar terms. Of note, this includes a AUD 200 million uplift from non-ferrous prices, impacting both our inventory and receivable values. Despite this increase, we were able to retain overall trade working capital at a comparative level to the prior year. Following stabilization of copper pricing at its higher levels, reduced broker deposits related to our derivatives trading activities over what we had reported at the half. Intangibles uplifted by AUD 64 million, principally because of the favorable infrastructure services contract associated with the TCT acquisition, and this will be amortized over the life of that contract.

Speaker #3: Of note, this includes a $200 million uplift from non-ferrous prices, impacting both our inventory and receivable values. Despite this increase, we were able to retain overall trade working capital at a comparable level to the prior year.

Speaker #3: And following the stabilization of copper pricing at its higher levels, we reduced broker deposits related to our derivatives trading activities compared to what we had reported at the half.

Speaker #3: Intangibles were uplifted by $64 million, principally because of the favorable infrastructure services contract associated with the TCT acquisition, and this will be amortized over the life of that contract.

Warrick Ranson: Post the sale of our Houston properties, we expect gearing levels to revert to be more in line with our target range, and we remain deliberate in focusing our growth activities to where we see efficient through the cycle returns while protecting balance sheet flexibility. Pleasingly, our strong earnings and capital discipline uplifted the group's ROIC to 11.7%, and together with our positive free cash flow performance, the board has determined a final dividend of AUD 0.20 per share, fully franked and payable in October. This brings the total full-year dividend for 2026 to AUD 0.34 per share. But noting that the availability of future franking credits will become limited going forward as our earnings base becomes more US-centric. A little bit more on our working capital movement and the group's focus.

Speaker #3: Post the sale of our Houston properties, we expect gearing levels to revert to be more in line with our target range, and we remain deliberate in focusing our growth activities where we see efficient, through-the-cycle returns, while protecting balance sheet flexibility.

Speaker #3: Pleasingly, our strong earnings and capital discipline uplifted the group's ROIC to 11.7%. Together with our positive free cash flow performance, the board has determined a final dividend of 20 cents per share, fully franked and payable in October.

Speaker #3: This brings the total full-year dividend for 2026 to 34 cents per share. But noting that the availability of future franking credits will become limited going forward, as our earnings base becomes more US-centric.

Speaker #3: So, a little bit more on our working capital movement and the group's focus. Here, we've again isolated some of the movements to show the impact of those higher non-ferrous prices on the business, which continue to be quite significant.

Warrick Ranson: Here we have again isolated some of the movements to show the impact of those higher non-ferrous prices on the business, which continue to be quite significant. Following a relative stabilization in the copper price since the September run-up, we have been able to reduce the amount of restricted cash sitting in margin deposits at June, which, if you recall, was some AUD 95 million at the H1. While our total physical year-end metal inventory increased over prior year levels, we continue to align inventory holdings with scheduled sales and are focused on our conversion of receivables and the management of payables to match cash movements, keeping our overall working capital levels steady. All that summarizes into our overall cash movement for the last 12 months. I have talked about most of these already.

Speaker #3: Following a relative stabilization in the copper price since the September run-up, we've been able to reduce the amount of restricted cash sitting in margin deposits at June, which, if you recall, were some $95 million at the half.

Speaker #3: While our total physical year-end metal inventory increased over prior year levels, we continue to align inventory holdings with scheduled sales and are focused on our conversion of receivables and the management of payables to match cash movements.

Speaker #3: We're keeping our overall working capital levels steady. All of that summarizes into our overall cash movement for the last 12 months. I've talked about most of these already.

Speaker #3: We converted over 70% of our EBITDA performance to operating cash and invested approximately $488 million back into the business through capital and acquisitions. Funding for the purchase of Tricoastal is still expected to be covered by the sale of our Houston properties.

Warrick Ranson: We converted over 70% of our EBITDA performance to operating cash and invested some AUD 488 million back into the business through capital and acquisitions. Funding for the purchase of Tri Coastal Trading is still expected to be covered by the sale of our Houston properties. The Mayo Shell property remains under contract as the preferred purchaser completes its due diligence and concludes legal requirements. This is now likely to be a Q2 transaction for us. In addition, we have recently signed a letter of intent to sell our two other Houston properties, subject to due diligence. They are targeted to close early in Q3. in October, we made our final FY25 dividend payment of AUD 25 million, and a further AUD 27 million for the FY26 interim in March.

Speaker #3: The Mayo Shell property remains under contract as the preferred purchaser completes its due diligence and concludes legal requirements. This is now likely to be a Q2 transaction for us.

Speaker #3: In addition, we have recently signed a letter of intent to sell our two other Houston properties, subject to due diligence. They are targeted to close early in Q3.

Speaker #3: In October, we made our final FY25 dividend payment of $25 million and a further $27 million for the FY26 interim in March. As previously noted, the board has also determined a final dividend of $0.20 per share, fully franked, for 2026 in line with our capital management framework.

Warrick Ranson: As previously noted, the board has also determined a final dividend of AUD 0.20 per share, fully franked for 2026, in line with our capital management framework. With that, it is back to you, Stephen.

Speaker #3: And with that, it's back to you, Stephen.

Speaker #1: Thanks, Warrick. The next few slides will look at our strategic position and opportunities in both the SLS and metal businesses. Turning first to SLS, on slide 26.

Stephen Mikkelsen: Thanks, Warrick. The next few slides will look at our strategic position and opportunities in both the SLS and metal businesses. Turning first to SLS on slide 26. What this slide demonstrates is that the technical infrastructure required for AI is significantly more compute-intensive and expensive. If you look at the right-hand bottom chart, you can see the growing price for GPUs as they become more and more sophisticated to deal with the increasing demands of AI compute. We sell some GPUs today, but they are not overly sophisticated and the price is measured in hundreds of dollars. This is about to change. The complexity of repurposing GPUs that will start coming to the market in the next 12 or so months is an order of magnitude higher than what we do today.

Speaker #1: What this slide demonstrates is that the technical infrastructure required for AI is significantly more compute-intensive and expensive. If you look at the chart at the bottom right, you can see the rising price of GPUs as they become more and more sophisticated to meet the increasing demands of AI compute.

Speaker #1: We managed to sell some GPUs today, but they're not overly sophisticated, and the price is measured in hundreds of dollars. This is about to change.

Speaker #1: The complexity of repurposing GPUs that will start coming to the market in the next 12 or so months is an order of magnitude higher than what we do today.

Speaker #1: We are well positioned to capture this and have already commenced R&D to prove we can test and certify these GPUs in a real-world environment.

Stephen Mikkelsen: We are well-positioned to capture this and have already commenced R&D to prove we can test and certify these GPUs in a real-world environment. I cover this in a bit more detail on slide 27. The left-hand graphic compares the more traditional infrastructure we have been repurposing for the last few years with what is on the way from AI infrastructure. A couple of points to note here. Firstly, the significant expansion in the technical complexity and value of GPUs that I have already mentioned. Secondly, the density of the racks we will be dealing with. Right now, a rack we repurpose weighs up to 1,000 kilograms. Soon, these racks will be 5 tons. We have already been sent samples of what is coming from a major customer in order for us to assess the opportunities. We are well-positioned to capture these opportunities.

Speaker #1: We'll cover this in a bit more detail on slide 27. The left-hand graphic compares the more traditional infrastructure we have been repurposing for the last few years.

Speaker #1: With what is on the way from AI infrastructure, there are a couple of points to note here. Firstly, the significant expansion in the technical complexity and value of GPUs that I've already mentioned.

Speaker #1: And secondly, the density of the racks we will be dealing with. Right now, a rack we repurpose weighs up to 1,000 kilograms. Soon, these racks will be 5 tons.

Speaker #1: We have already received samples of what is coming from a major customer in order for us to assess the opportunities. We are well positioned to capture these opportunities.

Speaker #1: We have strong global and embedded relationships. We have proven, global-leading technical expertise in the current equipment and are actively pursuing R&D to ensure we are ready for the next wave.

Stephen Mikkelsen: We have strong global and embedded relationships. We have proven and global leading technical expertise in the current equipment and are actively pursuing R&D to ensure we are ready for the next wave. Slide 28 brings this all together to look at the medium-term growth drivers for SLS. Firstly, with all the talk focusing on the rapid growth in AI infrastructure, it is easy to forget that market commentary indicates higher volumes of DDR4 repurposing will last beyond 2028. DDR5 will be the next major memory repurposing opportunity, likely emerging over the next 12 to 24 months. I have already covered off GPUs, advanced processing, and AI infrastructure expansion, but it is worth noting that certification and aftermarket services will be an increasing part of our business as it relates to these activities. We see deeper customer integration as key, driven by our R&D and specialist engineering.

Speaker #1: Slide 28 brings this all together to look at the medium-term growth drivers for SLS. Firstly, with all the talk focusing on the rapid growth in AI infrastructure, it is easy to forget that market commentary indicates higher volumes of DDR4 repurposing will last beyond 2028.

Speaker #1: DDR5 will be the next major memory repurposing opportunity, likely emerging over the next 12 to 24 months. I've already covered off GPUs, advanced processing, and AI infrastructure expansion, but it's worth noting that certification and aftermarket services will be an increasing part of our business as it relates to these activities.

Speaker #1: We see deeper customer integration as key, driven by our R&D and specialist engineering. This leads to the final point, where it is becoming increasingly self-evident that the long-term pipeline of recoverable AI infrastructure is very large.

Stephen Mikkelsen: This leads to the final point, where it is becoming increasingly self-evident that the long-term pipeline of recoverable AI infrastructure is very large. Switching businesses now to our metal operations, beginning with North America on slide 29. The demand for both ferrous and non-ferrous continues to rise. Ferrous is being driven by further commissioning of EAFs. Our estimate is that another 7 million tons of high-quality ferrous scrap will be required by 2029. The demand for non-ferrous is being driven by many things, including the building of data centers. The table at the bottom shows that an estimated 11 tons of aluminum and 11 tons of copper are required per megawatt of new data center capacity. This growth plays nicely into our North American businesses, as shown on slide 30. The left and middle charts show just how important non-ferrous is to our North American businesses.

Speaker #1: Switching businesses now to our metal operations, beginning with North America, on slide 29. The demand for both ferrous and non-ferrous continues to rise. Ferrous is being driven by further commissioning of EAFs; our estimate is that another 7 million tons of high-quality ferrous scrap will be required by 2029.

Speaker #1: The demand for non-ferrous is being driven by many things, including the building of data centers. The table at the bottom shows that an estimated 11 tons of aluminium and 11 tons of copper are required per megawatt of new data center capacity.

Speaker #1: This growth plays nicely into our North American businesses, as shown on slide 30. The left and middle charts show just how important non-ferrous is to our North American businesses, with over half the revenue now coming from non-ferrous and over a quarter of that coming from NFSR, which helps underpin our investment in shredders and downstream processing and recovery technology.

Stephen Mikkelsen: With over half the revenue now coming from non-ferrous and over a quarter of that coming from NFSR, which helps underpin our investment in shredders and downstream processing and recovery technology. NAM and SA Recycling operate complementary footprints across the United States, but with different network profiles. SA Recycling has a greater concentration of sites in dense regional markets, while NAM is more weighted towards major metropolitan areas. SA Recycling's network comprises 153 sites and 23 auto shredders, giving it almost twice the number of yards and shredders as NAM. This density allows SA Recycling to buy more non-ferrous material at source, purchase more unprepared ferrous scrap, and produce more NFSR. This operating mix was an important contributor to its relative performance during the period, particularly the H2. Turning to ANZ on slide 31.

Speaker #1: NAM and SAR operate complementary footprints across the United States, but with different network profiles. SAR has a greater concentration of sites in dense regional markets, while NAM is more weighted towards major metropolitan areas.

Speaker #1: SAR's network comprises 153 sites and 23 auto shredders, giving it almost twice the number of yards and shredders as NAM. This density allows SAR to buy more non-ferrous material at source, purchase more unprepared ferrous scrap, and produce more NFSR.

Speaker #1: This operating mix was an important contributor to its relative performance during the period, particularly the second half. Turning to ANZ on slide 31, there is no denying that the ferrous business for ANZ has been tough over the last two to three years, with exports from China.

Stephen Mikkelsen: There is no denying that the ferrous business for ANZ has been tough over the last two to three years with exports from China. This will be somewhat alleviated over the medium term with planned mill upgrades in Australia, the Glenbrook EAF in New Zealand, and the likely development of one, but maybe two EAFs in Australia. A reasonable scenario presented in the chart shows that surplus scrap available for export could fall to under 1 million tons by 2029. This will be quite pronounced by state, with some in surplus and others deficit. Our national coverage and superior logistics will be an advantage as this scenario unfolds. Like our North American businesses, ANZ has a strong non-ferrous operation, and this is shown on slide 32. Nearly 60% of ANZ's sales revenue comes from non-ferrous, and around 14% of that comes from NFSR.

Speaker #1: This will be somewhat alleviated over the medium term with planned mill upgrades in Australia, the Glenbrook EAF in New Zealand, and the likely development of one, but maybe two, EAFs in Australia.

Speaker #1: A reasonable scenario presented in the chart shows that surplus scrap available for export could fall to under a million tons by 2029. This will be quite pronounced by state, with some in surplus and others in deficit.

Speaker #1: Our national coverage and superior logistics will be an advantage as this scenario unfolds. Like our North American businesses, ANZ has a strong non-ferrous operation, and this is shown on slide 32.

Speaker #1: Nearly 60% of ANZ's sales revenue comes from non-ferrous, and around 14% of that comes from NFSR. This strong non-ferrous position has enabled ANZ to navigate the particularly tough ferrous market conditions it has experienced.

Stephen Mikkelsen: This strong non-ferrous position has enabled ANZ to navigate the particularly tough ferrous market conditions it has experienced. ANZ is investing in more advanced metal recovery plants and fine plants to ensure valuable non-ferrous is recovered and not sent to landfill. ANZ has an extensive national network of collection yards and is growing at-source volumes, which will drive further non-ferrous growth. What this all means for ANZ and North America medium-term growth prospects is covered on slide 33. The North American market is likely to see further consolidation, benefiting both NAM and SA Recycling. Some of this will be acquisition of mid-tier businesses with shredders and feeder yard networks. Others will be bolt-on feeder yards to expand our network supplying existing shredders. This will provide more unprocessed, at-source material, including non-ferrous. There is still room to improve downstream processing through our existing operational excellence and further technology.

Speaker #1: ANZ is investing in more advanced metal recovery plants and fine plants, to ensure valuable non-ferrous is recovered and not sent to landfill. ANZ has an extensive national network of collection yards and is growing at-source volumes, which will drive further non-ferrous growth.

Speaker #1: What this all means for ANZ and North American medium-term growth prospects is covered on slide 33. The North American market is likely to see further consolidation, benefiting both NAM and SAR.

Speaker #1: Some of this will be acquisition of mid-tier businesses with shredders and feeder yard networks; others will be bolt-on feeder yards to expand our network supplying existing shredders.

Speaker #1: This will provide more unprocessed at-source material, including non-ferrous. There is still room to improve downstream processing through our existing operational excellence and further technology.

Speaker #1: The demand for ferrous scrap is a medium- to long-term tailwind, as tariffs and EAF expansion support demand for the foreseeable future. In ANZ, the commissioning of Glenbrook and a potential FID for Alta will provide medium- to long-term support for ferrous scrap demand and prices.

Stephen Mikkelsen: The demand for ferrous scrap is a medium to long-term tailwind as tariffs and EAF expansion support demand foreseeable future. In ANZ, the commissioning of Glenbrook and potential FID for Alter Steel will provide medium to long-term support for ferrous scrap demand and prices. As with North America, there are opportunities for bolt-on acquisitions to support increased processing capability and capacity. Finally, non-ferrous is a near-term, medium-term, and long-term growth driver for ANZ. My final slide before going to Q&A is slide 34, which is more short-term by focusing on the outlook for FY27. Starting with SLS. We expect the H1 to produce an underlying EBIT between AUD 75 million and AUD 90 million. Fundamentals remain strong, but as we have discussed on a number of slides, variability in decommissioning in the very short term will be a feature of this market.

Speaker #1: As with North America, there are opportunities for bolt-on acquisitions to support increased processing capability and capacity. Finally, non-ferrous is a near-term, medium-term, and long-term growth driver for ANZ.

Speaker #1: My final slide before going to Q&A is slide 34, which is more short-term by focusing on the outlook for FY27. Starting with SLS, we expect the first half to produce an underlying EBIT between $75 million and $90 million.

Speaker #1: Fundamentals remain strong, but as we have discussed on a number of slides, variability in decommissioning in the very short term will be a feature of this market.

Speaker #1: We are not expecting as much high-speed DDR4 volume in the first half of FY27 as we had in the second half of FY26. We expect that the factors supporting a strong non-ferrous contribution will continue in FY27 for all our metal businesses.

Stephen Mikkelsen: We are not expecting as much high-speed DDR4 volume in the H1 of FY27 as we had in the H2 of FY26. We expect that the factors supporting a strong non-ferrous contribution will continue in FY27 for all our metal businesses. We expect the ferrous contribution from our North American metal businesses in FY27 to be supported by tariffs, EAF growth, and steel demand from data center growth. We are not expecting a material reduction in Chinese steel exports in FY27, and this will continue to impact ANZ's ferrous business. Before we open for Q&A, as always, I want to thank our employees for their drive and commitment in delivering on our purpose, and most importantly, doing that safely. Back to you, operator.

Stephen Mikkelsen: We are not expecting as much high-speed DDR4 volume in the H1 of FY27 as we had in the H2 of FY 2026. We expect that the factors supporting a strong non-ferrous contribution will continue in FY27 for all our metal businesses. We expect the ferrous contribution from our North American metal businesses in FY27 to be supported by tariffs, EAF growth, and steel demand from data center growth. We are not expecting a material reduction in Chinese steel exports in FY27, and this will continue to impact ANZ's ferrous business. Before we open for Q&A, as always, I want to thank our employees for their drive and commitment in delivering on our purpose, and most importantly, doing that safely. Back to you, operator.

Speaker #1: We expect the ferrous contribution from our North American metal businesses in FY27 to be supported by tariffs, EAF growth, and steel demand from data center growth.

Speaker #1: We are not expecting a material reduction in Chinese steel exports in FY27, and this will continue to impact ANZ's ferrous business. Before we open for Q&A, as always, I want to thank our employees for their drive and commitment in delivering on our purpose and, most importantly, doing that safely.

Speaker #1: Back to you, operator.

Speaker #2: Thank you. If you wish to ask a question, you will need to press star one on your telephone and wait for your name to be announced.

Operator: Thank you. If you wish to ask a question, you will need to press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two, and if you are on a speakerphone, please pick up the handset to ask your question. Your first question comes from Peter Steyn from Macquarie. Please go ahead.

Speaker #2: If you wish to cancel your request, please press star two. If you're on a speakerphone, please pick up the handset to ask your question.

Speaker #2: Your first question comes from Peter Stein from Macquarie. Please go ahead.

Speaker #1: Hi, Stephen. Warrick, thank you very much. I just had a question on SLS. You mentioned the need to engender yourself as your customers. In my mind, what's happening in your services revenue is probably the key one there.

Peter Steyn: Hi, Stephen Warrick. Thank you very much.

Peter Steyn: Hi, Stephen ,Warrick. Thank you very much.

Stephen Mikkelsen: Hi, Peter.

Peter Steyn: Just on SLS. You mentioned the need to engender yourself with your customers. In my mind, what is happening in your services revenue is probably the key one there. It has lost a little bit of momentum in the H2 relative to where you were in the H1. Obviously, still growing, but not showing the type of growth that certain your repurposed units would demonstrate. Could you give us a bit of a sense of how you focus the team on that, what you are seeing from a services perspective, whether that is the correct way to think about this business and the strength and depth of its customer relationships?

Speaker #1: And it's lost a little bit of momentum in the second half relative to where you were in the first half. Obviously, still growing, but not showing the type of growth that your repurposed units would demonstrate.

Speaker #1: Could you give us a bit of a sense of how you focus the team on that? What you're seeing from a services perspective, whether that is the correct way to think about this business, and the strength and depth of its customer relationships?

Speaker #3: Yeah, sure, Peter. So, with those services, the predominant service we provide there, or the most valuable service, is where we'll take a DDR4 out and repurpose it back into the business.

Stephen Mikkelsen: Yeah. Sure, Peter. With those services, the predominant service we provide there, or the most valuable service is where we will take a DDR4 out and repurpose it back into the business. So that continued at pace. There were no issues with that in the H2 versus the H1. What happened is that, the customer can get to choose whether or not it gets repurposed back into them or do they want it to be resold into the market. I think particularly in that H2, a number of customers made the decision, "Well, we may not need that as urgently back into the center. Let's take advantage of some higher selling prices and resell it into the market." So it is more what was driving the sales. We are optimizing the sales.

Speaker #3: So that continued at pace. There were no issues with that in the second half versus the first half. What happened is that the customer can get to choose whether or not it gets repurposed back into them or if they want it to be resold into the market.

Speaker #3: And I think, particularly in that second half, a number of customers made a decision—well, we may not need that as urgently—back into the center.

Speaker #3: Let's take advantage of some high selling prices and resell it into the market. So it's more what was driving the sales. We're optimizing the sales.

Speaker #3: It wasn't a fall-off in the amount of that sort of core service that we do around taking DDR4s out of the core center and out of the data center, and deciding what to do with it from that point.

Stephen Mikkelsen: It was not a fall-off in the amount of that sort of core service that we do around taking DDR4 out of the data center and deciding what to do with it from that point.

Speaker #1: Yeah. So, I mean, maybe just coming to the strategic thrust of the question—are you actually focusing more attention there than ultimately trying to maximize re-commerce revenue?

Peter Steyn: Yeah. Maybe just coming into the strategic thrust of the question. Are you actually focusing more attention there than ultimately trying to maximize recommerce revenue?

Speaker #3: So I guess what we focus on is maximizing inflow. That is about—I mean, inflow comes from strong relationships and embedded relationships.

Stephen Mikkelsen: I guess what we focus on is maximizing inflow. That is about, an inflow comes from strong relationships and embedded relationships, our systems tying in with their systems. The process that we then do on what we inflow is very, very similar, whether it is going to be resold or repurposed back into the data center. If it is repurposed back into the data center, there is more around, I guess inventory management and logistics to get it back into the data center at the right place. But we focus on inflow. Ultimately, whether it is resold or goes back into the data center is the call of the data center itself.

Speaker #3: Our systems tying in with their systems. What we do with what we inflow is very, very similar, whether it's going to be resold or repurposed back into the data center.

Speaker #3: If it’s repurposed back into the data center, there’s more around, I guess, inventory management and logistics to get it back into the data center at the right place.

Speaker #3: But we focus on inflow. Ultimately, whether it is resold or goes back into the data center is the core of the data center itself.

Speaker #1: Cool. And then maybe just a change of focus to SAR. Could you give us a bit of a sense of how to think about the annualization impact of acquisitions in SAR, just rolling into '27?

Peter Steyn: Cool. Then maybe just a change of focus to SA Recycling. Could you give us a bit of a sense of how to think about the annualization impact of acquisitions in SA Recycling just rolling into 2027?

Speaker #3: Yeah, I think, and I might get dropped here if I think about this question as well, but it could be my initial thoughts. Rob spends a lot of time with SA Recycling up in the US.

Stephen Mikkelsen: Yeah, I think, and I might get Rob to have a think about this question as well. Let me give you my initial thoughts and Rob spends a lot of time with SA Recycling up there in the US. SA Recycling, its acquisitions in FY27 were almost entirely good quality bolt-ons. I cannot recall off the top of my head whether they bought another shredder. I think they did. They bought another shredder down in Florida.

Speaker #3: So, SA Recycling—its acquisitions in FY27 were almost entirely good-quality bolt-ons. I cannot recall off the top of my head whether they bought another shredder; I think they did.

Speaker #3: Bought another shredder down in Florida. So what that does for SA Recycling is it provides a sort of further in-feed into its shredders, which have also got extra capacity in them.

Rob Thompson: Yes.

Stephen Mikkelsen: What that does for SA Recycling is it provides a further infeed into its shredders, which have also got extra capacity in them. What does that mean for the run rate leading out of FY26 into FY27? I think a combination of strong non-ferrous markets, which is really driving Zorba and non-ferrous retail and justifying these feeder yards hugely for more unprocessed material in. Broadly speaking, I think the run rate in the H2 is probably not bad as we go into the H1. But Rob, I would like to hear your views on that as well.

Stephen Mikkelsen: What that does for SA Recycling is it provides a further infeed into its shredders, which have also got extra capacity in them. What does that mean for the run rate leading out of FY 2026 into FY27? I think a combination of strong non-ferrous markets, which is really driving Zorba and non-ferrous retail and justifying these feeder yards hugely for more unprocessed material in. Broadly speaking, I think the run rate in the H2 is probably not bad as we go into the H1. But Rob, I would like to hear your views on that as well.

Speaker #3: So what would I think—what does that mean for the run rate leading out of FY26 into FY27? I mean, I think it's a combination of strong non-ferrous markets, which is really driving Zorba, non-ferrous retail, and justifying these feeder yards hugely for more unprocessed material in.

Speaker #3: I think, broadly speaking, the run rate in the second half is probably not bad as we go into the first half. But, Rob, I'd like to get your views on that as well.

Rob Thompson: The only thing I would add, after speaking to the principals of SA quite recently in a board meeting, FY26 was a bit of a reorganization for them. Stephen mentioned they had bought further shredding assets in the Southeast of the United States. They did trade off or sell off some of their northern Midwest assets. Largely what they did was bolster their existing footprint and with feeder yards and kind of the spoken hub that they are accustomed to.

Rob Thompson: The only thing I would add, after speaking to the principals of SA quite recently in a board meeting, FY 2026 was a bit of a reorganization for them. Stephen mentioned they had bought further shredding assets in the Southeast of the United States. They did trade off or sell off some of their northern Midwest assets. Largely what they did was bolster their existing footprint and with feeder yards and kind of the spoken hub that they are accustomed to.

Speaker #4: The only thing I'd add, after speaking to the principals at SA quite recently and a board meeting—26, FY26 was a bit of a reorganization for them.

Speaker #4: Stephen mentioned they bought additional shredding assets in the Southeast of the United States. They did trade off or sell off some of their northern Midwest assets.

Speaker #4: So largely, what they did was bolster their existing footprint, and with feeder yards and kind of the spoke-and-hub model that they were accustomed to.

Speaker #3: I mean, I guess the process summarized, Peter. I think with market conditions, and as you can probably tell from the whole presentation, whether it be ANZ, NAM, or SA Recycling, non-ferrous is driving those results now.

Stephen Mikkelsen: I guess if I was to summarize, Peter, I think with market conditions, as you can probably tell in our whole presentation, whether it be ANZ, NAM, or SA Recycling, non-ferrous is driving those results now. I do not see that changing, is it one year, two years, three years? I am not sure, but it is hard to see what would change that dynamic. I feel in all three businesses, we are well-positioned, and I would expect that continuing into FY27 at the absolute minimum.

Speaker #3: And I don't see that changing, whether it's one year, two years, or three years. I'm not sure, but it's hard to see what would change that dynamic.

Speaker #3: And so I feel we're, in all three businesses, we're well positioned, and I would expect that to continue through FY27 at the absolute minimum.

Peter Steyn: Perfect. Thanks very much, Stephen. Appreciate it. Thanks, Rob.

Speaker #1: Perfect. Thanks very much, Stephen. Appreciate it. Thanks, Rob.

Stephen Mikkelsen: Thanks, Peter.

Speaker #3: Thanks, Peter.

Speaker #2: Thank you. Your next question comes from Lee Powell from JPMorgan. Please go ahead.

Operator: Thank you. Your next question comes from Lee Power from J.P. Morgan. Please go ahead.

Operator: Thank you. Your next question comes from Lee Power from JPMorgan. Please go ahead.

Lee Power: Good morning, Stephen, Warrick. Stephen, just on the SLS guide, is it possible to give us kind of an implied what your assumptions are just around repurposed units or gigabytes sold just in the volume piece?

Speaker #1: Good morning, Stephen. Warrick, just on the SLS guide, is it possible to give us kind of an idea of what your assumptions are just around repurposed units or gigabytes sold, just in the volume piece?

Stephen Mikkelsen: Yeah.

Lee Power: And then-

Speaker #1: And then?

Speaker #3: Maybe I can give you—oh, sorry. Sorry, Lee, I interrupted. I'll let you finish your question.

Stephen Mikkelsen: Maybe I can give. Oh, sorry. Lee, I interrupted. I will let you finish your question.

Speaker #1: No, no, no. You go. You go.

Lee Power: No, you go.

Speaker #3: Yeah. So the actual—you need to dig down into the volume. And I think what we've said throughout the presentation, which has come through quite clearly, is that the data centers are not refreshing or decommissioning to our half-year timetables.

Stephen Mikkelsen: Yeah. You need to dig down into the volume. I think what we've said throughout the presentation, which has come through quite clearly, is that the data centers are not refreshing or decommissioning to our H1 timetables. There's obviously been a lot of, which is ultimately, in the long run, very good news. There's been a huge amount of proposed and data center construction, and there's a lot of indigestion going on. I think it doesn't matter where you look, that's been quite broadly reported in media and trade journals and all those types of things. What is happening in the H1. The H1, we do have some line of sight to with our relationships.

Speaker #3: And there's obviously been a lot of—which is ultimately, in the long run, very good news. There's been a huge amount of proposed and data center construction.

Speaker #3: And there's a lot of indigestion going on. I think it doesn't matter where you look; that's been quite broadly reported in the media, trade journals, and all those types of things.

Speaker #3: So what's happening in the first half and so the first half, we do have some line of sight too with our relationships. We can see what's going to actually happening is that the we're getting less of the higher speed DDR4s coming through.

Stephen Mikkelsen: We can see what's going to actually be happening, is that we're getting less of the higher speed DDR4s coming through, and those are the more valuable ones that we had in FY26. The reason why that's happening is that they are holding onto those for a bit longer because they still have some value while they're waiting for the refresh to happen, while they're waiting for the electrical connection upgrade or the DDR5s to arrive or whatever. The volume, it's probably not a total volume story, it's the mix of the volume and in particular, the speed of the DDR4s that are coming out. It's now another layer of complexity. I understand that. All DDR4s are not alike now. We've got 32, we've got 16 gigs, and now what's becoming hugely influential is the speed of those DDR4 chips. That's what's influencing the H1.

Stephen Mikkelsen: We can see what's going to actually be happening, is that we're getting less of the higher speed DDR4s coming through, and those are the more valuable ones that we had in FY 2026. The reason why that's happening is that they are holding onto those for a bit longer because they still have some value while they're waiting for the refresh to happen, while they're waiting for the electrical connection upgrade or the DDR5s to arrive or whatever. The volume, it's probably not a total volume story, it's the mix of the volume and in particular, the speed of the DDR4s that are coming out. It's now another layer of complexity. I understand that. All DDR4s are not alike now. We've got 32, we've got 16 gigs, and now what's becoming hugely influential is the speed of those DDR4 chips. That's what's influencing the H1.

Speaker #3: And those are the more valuable ones that we had in FY26. The reason why that's happening is that they are holding onto those for a bit longer because they still have some value, while they're waiting for the refresh to happen—while they're waiting for the electrical connection upgrade, or the DDR5s to arrive, or whatever.

Speaker #3: So, the volume—it's probably not a total volume story. It's the mix of the volume and, in particular, the speed of the DDR4s that are coming out.

Speaker #3: It's now another layer of complexity. I understand that. But all DDR4s are not alike now. We've got 32, we've got 16 gigs, and now what's becoming hugely influential is the speed of those DDR4 chips.

Speaker #3: So that's what's influencing the first half. There's lower speed coming out—still the volume, but lower speed. What I would say about that, though, is that they still need to come out.

Stephen Mikkelsen: There's lower speed coming out, still the volume, but lower speed. What I would say about that, though, is that they still need to come out. Those high-speed DDR4s still need to come out. It's just timing. There's a massive demand for them in the market. I note the comment that JB Hi-Fi made and their result around the rapid rise in prices for everything IT related and the impact that that's having, and that's all been driven by the shortage. The way you need to think about volume is the DDR4s that are coming out in the H1 are of lower speed quality than what we've seen, and therefore, are not as high value as what we've seen. The high-speed ones still need to come out.

Speaker #3: Those high-speed DDR4s still need to come out. It's just timing. There's a massive demand for them. And in the market—I mean, I know the comment that JB Hi-Fi made in their result around the rapid rise in prices for everything IT-related, and the impact that that's having.

Speaker #3: And that's all been driven by this shortage. So, the way you need to think about volume is: the DDR4s that are coming out in the first half are of lower speed quality than what we've seen.

Speaker #3: And therefore, are not as high value as what we've seen. The high-speed ones still need to come out.

Speaker #1: Okay. And then just going on, thinking a little bit longer term, is there a different volume outlook across service and resale? I kind of hear your comments to Peter—your answer to Peter's question before—around how ultimately a high-priced product, people want to reuse, but reuse in their own network.

Lee Power: Okay. Just going on, thinking a little bit longer term in it, is there a different volume outlook across service and retail? I key your comments to your answer to Peter Steyn's question before around how ultimately a high-priced product people want to reuse in their own network. It seems like at the same time, the higher price drove the resale. I guess I'm kind of a bit confused. In the longer term, is a higher price when you get more of the refresh happening, do you think that that is more likely to mean the product is reused in the data center and then you get the service fee? Or do you think it's more likely to be sold, and therefore you get a service fee and the resale component.

Speaker #1: But then it seemed like at the same time, a high the higher price drove the resale. So I guess I'm kind of a bit confused in the longer term, is a higher price when you get more of the refresh happening, do you think that that is more likely to mean the product is reused in the data center?

Speaker #1: And then you get the service fee, or do you think it's more likely to be sold and therefore, you get a service fee and the resale component?

Speaker #3: Yeah. I don't think it's I don't think it's going to be as simple as one or the other. I think in the medium term, in the medium term, more of the DDR4s will end up in the resale market because the DDR5s will be what's repurposed back into the data centers.

Stephen Mikkelsen: Yeah. I do not think it is going to be as simple as one or the other. I think in the medium term, more of the DDR4s will end up in the resale market because the DDR5s will be what is repurposed back into the data centers. I think that is probably the main relationship, and I think the higher price for DDR4s will also encourage that. So really over the next 12 months as DDR5s start coming out, I think more DDR4s will find their way into the resale market. Do not get me wrong, some will be repurposed because they can be, but I think that is how the market dynamic is going to play out.

Speaker #3: I think that's probably the main relationship. And I think the higher price for DDR4s will also encourage that. So it will really over the next 12 months as DDR5s start coming out, I think DDR4s will more DDR4s will find them their way into the resale market.

Speaker #3: Some—don't get me wrong—some will be repurposed, because they can be. But that's how I think the market dynamic is going to play out.

Speaker #1: Okay, thank you. And then just a final one, if I can, on the metals business. So I guess I'm probably, like a few others, trying to think about how we bridge into '27, given the lack of quantitative guidance.

Lee Power: Okay, thank you. Just a final one, if I can, on the metals business. I guess I am probably like a few others trying to think about how we bridge into 2027, given the lack of quantitative guidance. If I look at NAM and SA Recycling in the H2 2026, you did AUD 259 million of EBIT, which is obviously very strong given you did, I think, AUD 112 million in the H1. There are acquisitions and a few other things, but is it sensible to bridge off that H2 number as a starting point for H1 2027? What else is going on there that we need to think about that would mean that that AUD 259 million EBIT for NAM and SA Recycling is not the appropriate starting point as we look into FY27?

Speaker #1: So if I look at NAM and SAR in the second half, 2026, you do $259 million of EBIT, which is obviously very strong given you did, I think, $112 million in the first half.

Speaker #1: What I mean is, there are acquisitions and a few other things, but is it sensible to bridge off that second half number as the starting point for first half '27?

Speaker #1: What else is going on there that we need to think about that would mean that the $259 million EBIT for NAM and SAR is not the appropriate starting point as we look into FY27?

Speaker #3: Yeah, so that's a good question. Let me ask it at a high level, and then we've got Rob in the room, and he can maybe go into a little bit more detail on it.

Stephen Mikkelsen: Yeah. That is a good question. Let me answer it at a high level, and then we have Rob in the room and he can maybe go into a little bit more detail on it. I think the answer to that question is, we do not see the fundamentals. To answer that question, it is all driven by non-ferrous. Within that non-ferrous, Zorba has a large impact, because if you think about it, Zorba is a byproduct of shredding ferrous. In a sense, and this is a simplification, in a sense it comes at very little marginal cost because you are not actually buying it. The better quality shredders you have versus a competitor, that definitely comes at a lower marginal cost.

Speaker #3: I think the answer to that question is we don't see the fundamentals—I mean, to answer that question, it's all driven by non-ferrous.

Speaker #3: And within that non-ferrous, Zorba has a large impact because, if you think about it, Zorba is a byproduct of shredding ferrous. And so in a sense—and this is a simplification—in a sense, it comes at very little marginal cost.

Speaker #3: Because you're not actually buying it. And the better quality shredders you have versus a competitor, it definitely comes at a lower marginal cost. So our view is that we're not seeing anything that's happening in the second half to date—and we're coming towards the end of August—that would indicate that the non-ferrous market is getting softer.

Stephen Mikkelsen: Our view is that we are not seeing anything that is happening in the H2 to date, and we are coming towards the end of August, that would indicate that the non-ferrous market is getting softer. Therefore, it will be about volumes that we put through and what do we have to pay for those volumes. It is fair to say that NAM and SA Recycling do well out of our sophisticated shredding and downstream in order to be competitive on volumes. But Rob, you are there. What are your thoughts?

Speaker #3: So therefore, it will be about it will be about volumes that we put through and what do we have to pay for those volumes.

Speaker #3: It's fair to say that NAM and SAR do well out of our sophisticated shredding and downstream, in order to be competitive on volumes. But Rob, you're there.

Speaker #3: What are your thoughts?

Speaker #2: Yeah. The only thing I could add, Lee, is that in our slide deck, you see the incoming, I guess, demand curve we've been talking about for the last three or four years on the ferrous side.

Rob Thompson: Yeah, the only thing I could add, Lee, is that in our slide deck you see the incoming, I guess, demand curve we have been talking about for the last three or four years in the ferrous side. What SA Recycling and NAM are enjoying right now, and we have invested in our capabilities to get product to market, is, I will not call it exactly an insatiable demand for shredded product. So we have a very good demand for ferrous, which plays well into the non-ferrous story that we have depicted here today as well. A very good demand curve for aluminum products, for copper products, all of which we liberate from a ferrous intake. So incredibly good margin uplift there. Capacity still, that we have in our network. We have invested back into those networks. SA Recycling and NAM both have capacity to spare as well.

Speaker #2: And what SAR and NAM are enjoying right now—and we've invested in our capabilities to get product to market—is, I won't call it exactly an insatiable demand for shredded product, but we have a very good demand for ferrous.

Speaker #2: Which lays well into the non-ferrous story that we've depicted here today as well. A very good demand curve for aluminum products, for copper products, all of which we liberate from a ferrous intake — incredibly good margin uplift there.

Speaker #2: And capacity still that we have in our network. We've invested back into those networks—SAR and NAM both have capacity to spare as well.

Speaker #1: Excellent. Thanks, Robin. Thanks, David, for the call. I appreciate it.

Lee Power: Excellent. Thanks, Rob, and thanks, Stephen, for the color. I appreciate it.

Speaker #3: Thanks, Lee.

Stephen Mikkelsen: Thanks, Lee.

Speaker #4: Thank you. Yeah. The next question comes from Owen Barrow from RBC Capital Markets. Please go ahead.

Operator: Thank you. Your next question comes from Owen Birrell from RBC Capital Markets. Please go ahead.

Speaker #5: Yeah, good morning, guys. I just wanted to—I'll probably just go on to extend some of Lee's questions around the volume assumptions rolling into that first half '27 guidance.

Owen Birrell: Yeah, morning, guys.

Stephen Mikkelsen: Hi, Owen.

Owen Birrell: I am probably just going to extend on some of Lee's questions around the volume assumptions rolling into that H1 2027 guidance. Your guidance is, from an EBIT perspective down, call it a third, half on half. I just want to understand, should we be thinking about ongoing growth in, say, the input volumes, but it is purely a mix? Or should we be assuming both a decline in the input volumes and then also the mix on top of that? Because I know last time you gave us a memory sold guide to align with the EBIT guide. This time you have not given us the memory sold guide, but it sounds like you have some reasonably good visibility into that. I just wonder if you can give us a sense on that memory sold number so we have a comparable.

Speaker #5: Your guidance is from an EBIT perspective down, call it a third half-on-half. And I just want to understand, should we be thinking about ongoing growth in, say, the input volumes by just purely a mix, or should we be assuming both a decline in the input volumes and then also the mix on top of that?

Speaker #5: Last time, you gave us a memory sold guide to align with the EBIT guide. This time, you haven't given us the memory sold guide, but it sounds like you have reasonably good visibility into that.

Speaker #5: I just want to give us a sense of that memory sold number so we have a comparable.

Stephen Mikkelsen: I think in the medium term. So a couple of points in there. As this market has matured, it is really interesting that gigabyte memory sold is still a nice measure, but then it is the mix within there about speed. So it is not just DDR4s, it is the speed of the DDR4s. I think what you should be thinking beyond the H1, and like I said, we do have quite a lot of visibility into the H1. We do not have as much visibility into the H2. But what we do know is that the volume is going to increase. In the market as a whole, there is not less coming out. From December on, there is more coming out from December on. The timing of that is still, is it going to come out in the H2 of 2027?

Speaker #3: I think in the medium term—so, a couple of points in there. As this market has matured, it's really interesting that gigabyte memory sold is still a nice measure, but then it's the mix within there about speed.

Speaker #3: So, it's not just DDR4s; it's the speed of the DDR4s. I think what you should be thinking about is beyond this, beyond the first half. And like I said, we do have quite a lot of visibility into the first half.

Speaker #3: We don't have as much visibility into the second half, but what we do know is that volume is going to increase. In the market as a whole, there's not less coming out from December on.

Speaker #3: There's more coming out from December on. The timing of that is still—is it going to come out in the second half of ’27?

Speaker #3: Is it going to come out in the first half of '28? That's not up to us. That's up to the timing of the data center.

Stephen Mikkelsen: Is it going to come out in H1 2028? That is not up to us. That is up to the timing of the data center. So more volume will be coming out because more volume is sitting there than has been in there. The second point I would make is that the mix of that volume should improve as well because as we are getting more through the refresh cycles, we are getting higher and higher quality DDR4s that are faster and faster, and those are the ones that are worth more. So I am sitting here feeling pretty comfortable about the medium-term outlook. I just unfortunately cannot provide you a half-by-half assessment of exactly when that will come out. But it is not less volume and it is not less quality, is I think the main point. It is more volume, more quality that I would make.

Speaker #3: So, more volume will be coming out because more volume is sitting there than has been in there. The second point I'd make is that the mix of that volume should improve as well, because as we're getting more through the refresh cycles, we're getting higher and higher quality DDR4s that are faster and faster, and those are the ones that are worth more.

Speaker #3: So I'm sitting here, feeling pretty comfortable about the medium-term outlook. I just unfortunately can't provide you a half-by-half assessment of exactly when that will come out.

Speaker #3: But it's not less volume, and it's not less quality. I think the main point is, it's more volume, more quality—that I would make.

Speaker #5: Yeah, I understand, I guess, the qualitative comments that you have provided, but the challenge that we're facing is we don't have a baseline. And it's all good and fine to talk about growth in different metrics off the baseline, but we don't have the baseline.

Owen Birrell: Yeah, I understand, I guess the qualitative comments that you have provided. But the challenge that we are facing is we do not have a baseline. And it is all good and fine to talk about growth in different metrics off the baseline, but we do not have the baseline. And I guess that is what I am trying to get at. So if there is any further color you can provide around, I guess, how the mix currently stands so that we can move beyond that, it would be appreciated.

Speaker #5: And I guess that's what I'm trying to get at. So is there any further color you can provide around, I guess, how the mix currently stands, so that we can move beyond that and be appreciated?

Stephen Mikkelsen: Yeah. Let me take that question on notice, because I do not want to. I will be really frank. I do not want to blurt out a whole lot of numbers now that

Speaker #3: Yeah. Let me take that question on notice. Because I don't want to. I'll be really frank. I don't want to blow it out a whole lot of numbers now that we haven't thought that we haven't thought through as to what as to how you would interpret those.

Owen Birrell: Sure

Stephen Mikkelsen: we have not thought through as to how you would interpret those, because there is some complexity going on here. So, it is a good question. Let me take that on notice and Warrick and I will talk to Ana, and we will see what else we can maybe look at for you. Well, not for you, for the market.

Speaker #3: Because there is some complexity going on here, it's a good question. Let me take that on notice, and Warrick and I will talk to Anna, and we'll see what else we can maybe look at for you.

Speaker #3: Well, not for you—for the market.

Speaker #5: For the market. Sure. And can I just ask—I mean, you mentioned comments around the broader market, and volume is going to increase in the market as a whole.

Owen Birrell: For the market. Sure. Can I just ask, you made some comments around the broader market and volume is going to increase in the market as a whole. Can I just ask how you feel SLS is positioned within that market? Because we're constantly hearing about data center growth coming at pace. I know you talked about the decommissioning cycle pausing for a moment or different assets being decommissioned. We do know that the growth in the platform is continuing to grow across multiple different clients and across the US predominantly. What I want to understand, I guess is, how is SLS positioned within that? Has SLS grown its customer base as quickly as the market has grown during, say, the last 12 months? Do you feel like you're growing or losing share, as a proportion of the total market?

Speaker #5: Can I just ask how you feel SLS is positioned within that market? Because we're constantly hearing about data center growth coming at pace. I know you sort of talked about the decommissioning cycle kind of pausing for a moment, or different assets being decommissioned.

Speaker #5: But we do know that the growth on the platform is continuing across multiple different clients and predominantly across the US. What I want to understand, I guess, is how SLS is positioned within that?

Speaker #5: Has SLS grown its customer base as quickly as the market has grown during the last 12 months? And do you feel like you're growing or losing share as a proportion of the total market?

Speaker #5: I know it was very, very vague, but I just came to get your thoughts.

Owen Birrell: I know it's very vague, but I just wanted to get your thoughts.

Speaker #3: Yeah. So, I feel—so if I look at it, there's two aspects to that question: existing customers and potential new customers. I feel we are growing our share of existing customers.

Stephen Mikkelsen: Well, if I look at two aspects of that question, existing customers and potential new customers. I feel we are growing our share of existing customers. Our relationships are strong. We have a good idea of what they are producing in total. We know what we're getting, and I feel very comfortable within our existing customer base that we're doing. We're actually doing very well in that existing customer base. I feel very comfortable about that, and those customers are big within the market. We're not talking small bit players. They are big customers within that market. I know I'm going on about this a bit, but it really is the short term, 3 months, 6 months, is just not the way that these people think. Therefore, they'll decommission and refresh however they want to. But I feel we're growing in there.

Speaker #3: Our relationships are strong. We have a good idea of what they are producing in total. We know what we're getting, and I feel very comfortable with our existing customer base and what we're doing.

Speaker #3: We're actually doing very well in that existing customer base, so I feel very comfortable about that. And those customers are big within the market.

Speaker #3: We're not talking about small bit players—they're big customers within that market. And it really is—I know I'm going on about this a bit—but it really is the short term, three months, six months, it's just not the way that these people think.

Speaker #3: And so therefore, they'll decommission and refresh however they want to. But I feel we're growing in that. In terms of new customers, we have definitely had some success in gaining new customers, but when you gain a new customer, it's a foot in the door.

Stephen Mikkelsen: In terms of new customers, we have definitely had some success in gaining new customers, but when you gain a new customer, it's a foot in the door. It's not bang, you're going to get the same volumes as your existing customers from day one. When I look at our competitors in the market, I feel we are holding our own at the very least in terms of market expansion, and I could argue growing it.

Speaker #3: It's not like you're going to get the same volumes as your existing customers from day one. But when I look at our competitors in the market, I feel we are holding our own at the very least in terms of market expansion, and I could argue growing it.

Speaker #5: And can I ask, in terms of the volumes that are coming through—I know you mentioned the sort of differentials between high-speed, low-speed DDR4s.

Owen Birrell: Can I ask, in terms of the volumes that are coming through, I know you mentioned the differentials between high speed, low speed DDR4s. As I mentioned, the DDR3 is in here, and at some point, DDR5s are coming through. Are you able to give us a sense of the rough splits around the memory that is currently coming through

Speaker #5: As I mentioned, if DDR3 is in here and at some point DDR5s are coming through, are you able to give us a sense of the rough splits around the memory that's currently coming through?

Stephen Mikkelsen: Oh, right

Owen Birrell: your sales base, more particularly?

Speaker #5: Your sales base more particularly?

Speaker #3: Yeah. Right now, it's virtually all DDR4s. DDR3s probably came to an end through the second half of last fiscal year, FY26. Most of it would be—for all intents and purposes, you should think of it as DDR4s right now.

Stephen Mikkelsen: Yeah. Right now, it is virtually all DDR4. DDR3 probably came to an end. Through the H2 of FY26, most of it would be. For all intents and purposes, you should think of it as DDR4 right now, and the odd DDR5 is starting to arrive. Some of it is from our customers who want us to check exactly how we are going to handle DDR5, so that there is some slight technical differences, not difficulties. Nothing we cannot handle. So I think for this H1, it should be DDR4 almost exclusively, and then DDR5 will start to come in, I would say sometime in the next 12 months. Let me be really clear. Not at the expense of DDR4s. DDR4s will continue to. There is a lot of DDR4s installed in data centers that need to come out.

Stephen Mikkelsen: Yeah. Right now, it is virtually all DDR4. DDR3 probably came to an end. Through the H2 of FY 2026, most of it would be. For all intents and purposes, you should think of it as DDR4 right now, and the odd DDR5 is starting to arrive. Some of it is from our customers who want us to check exactly how we are going to handle DDR5, so that there is some slight technical differences, not difficulties. Nothing we cannot handle. So I think for this H1, it should be DDR4 almost exclusively, and then DDR5 will start to come in, I would say sometime in the next 12 months. Let me be really clear. Not at the expense of DDR4s. DDR4s will continue to. There is a lot of DDR4s installed in data centers that need to come out.

Speaker #3: And the odd DDR5 is starting to arrive. Some of it is from our customers, who want us to check exactly how we're going to handle DDR5s.

Speaker #3: There's some slight technical difficulties. Nothing different—it's not difficulties. Nothing we can't handle. And then, so I think for this first half, it should be DDR4s almost exclusively.

Speaker #3: And then DDR5s will start to come in, I would say, sometime in the next 12 months. But let me be really clear—not at the expense of DDR4s.

Speaker #3: DDR4s will continue to—there's a lot of DDR4s installed in data centers that need to come out.

Speaker #5: Sure. The repurpose units numbers are pretty strong in ’26. Of your resale revenues, how much is from DDR4 sales versus sales of other repurpose units?

Owen Birrell: Sure. The repurposed units numbers are pretty strong in 2026. Of your resale revenues, how much is from DDR4 sales versus sales of other repurposed units? Is it like 90%, 95%?

Speaker #5: Is it like 90%, 95%?

Speaker #3: No, it's not as high as that. So, repurpose unit can be anything that comes in. For example, it can be a cable.

Stephen Mikkelsen: No, it is not as high as that. Repurposed unit can be anything that comes in from-

Owen Birrell: Sure

Owen Birrell: It can be, for example, a cable. Just to use a simple example. A cable that comes in and resold is considered a repurposed unit. I do know what that number is. I do not know if we have disclosed it.

Speaker #3: I mean, just to use a simple example, a cable that comes in and is resold is considered a repurpose unit. I do know what that number is.

Speaker #3: I don't know if we've—I don't know if we have disclosed it. So.

Owen Birrell: We haven't. That is why I am asking.

Speaker #5: We haven't. That's what I'm asking.

Speaker #3: Yeah, yeah. So it's certainly not 90%, but it's more than 50%. Let me—again, I wasn't—let me take that. I'm sorry, I seem to be—let me take those questions on notice for you.

Stephen Mikkelsen: Yeah. It's certainly not 90%, but it's more than 50%. Let me take that one. Sorry, Owen. I've seen you. Let me take questions on notice for you.

Owen Birrell: Sure.

Speaker #3: Let me just double-check that that's not commercially sensitive. And I'll put that into the Anna's taking notes. I'll put that into the list of things that do we need to do we need to disclose that or our commercial guy saying we're mad to be disclosing that.

Stephen Mikkelsen: Let me just double-check that that's not commercially sensitive, and I'll put that into the. Ana Metelo's taking notes. I'll put that into the list of things that do we need to disclose that.

Owen Birrell: Okay. Thank you.

Stephen Mikkelsen: Or are our commercial guys saying we're mad to be disclosing that?

Speaker #5: Sure. Thanks.

Owen Birrell: Sure. Thanks.

Speaker #2: Thank you. Your next question comes from Brooke Campbell Crawford from Barron Jelly. Please go ahead.

Operator: Thank you. Your next question comes from Brook Campbell-Crawford from Barrenjoey. Please go ahead.

Speaker #4: Yeah, good morning. Thanks for taking my questions. I just had two. Firstly, just on the contract that you're signing recently—is the revenue share terms similar to your existing, kind of, longer-term contracts?

Brook Campbell-Crawford [Director of Research: Yeah, good morning. Thanks for taking my questions. I just had two. Firstly, just around your contracts that you are signing recently. Is the revenue share terms similar to your existing on a longer-term contracts? Just want to check if in case there is any slippage there, given obviously it is a really profitable business now relative to how it has been in years gone by. Thanks.

[Analyst] (Barrenjoey): Yeah, good morning. Thanks for taking my questions. I just had two. Firstly, just around your contracts that you are signing recently. Is the revenue share terms similar to your existing on a longer-term contracts? Just want to check if in case there is any slippage there, given obviously it is a really profitable business now relative to how it has been in years gone by. Thanks.

Speaker #4: Just wanted to check if, in case there's any slippage there, given obviously it's a really profitable business now relative to how it's been in years gone by.

Speaker #4: Thanks.

Speaker #3: Yeah, yeah, yeah. So, I mean, firstly, Brooke, we definitely won't disclose revenue share terms on specific contracts. And I think I know what you're talking about.

Stephen Mikkelsen: Yeah. Firstly, Brooke, we definitely will not disclose revenue share terms on specific contracts, and I think I know what you are talking about. What I would say is that contracts moving forward will have higher volumes because there is more coming out. But we definitely will not disclose what our revenue share terms are on those contracts.

Stephen Mikkelsen: Yeah. Firstly, Brook, we definitely will not disclose revenue share terms on specific contracts, and I think I know what you are talking about. What I would say is that contracts moving forward will have higher volumes because there is more coming out. But we definitely will not disclose what our revenue share terms are on those contracts.

Speaker #3: What I would say is that contracts, moving forward, will have higher volumes because there's more coming out. But we definitely won't disclose what our revenue share terms are in those contracts.

Speaker #4: Yeah. No, that's fair. I guess I wasn't really looking for a specific customer or anything, but just a broad trend. Is it staying stable in terms of your share versus customers in general, or is it changing at all?

Brook Campbell-Crawford [Director of Research: Yeah. No, that is fair enough. I guess I was not looking for specifics by customer anyway, but just the broad trend. Is it staying stable in terms of your share versus customers in general?

[Analyst] (Barrenjoey): Yeah. No, that is fair enough. I guess I was not looking for specifics by customer anyway, but just the broad trend. Is it staying stable in terms of your share versus customers in general?

Stephen Mikkelsen: Yeah.

Brook Campbell-Crawford [Director of Research: Or is it changing at all?

[Analyst] (Barrenjoey): Or is it changing at all?

Stephen Mikkelsen: I think it, as we are rolling contract, it varies by contract. We always trade off. As we are negotiating revenue share, we trade off volume with that rev share to see, because we are looking for total margin. I am not sitting here. If your question, am I sitting here worried about it? No, I am not. I am very comfortable with the deals we are negotiating at the moment and the rev share split and the volume split and what type of volume we are getting out. Actually, maybe that is a very good point that I will make. I want to talk about GPUs, because the rev share on a GPU will absolutely be lower in percentage terms than the rev share on a DDR4. The GPUs that are going to be coming out over the next 12 months and beyond are extraordinarily valuable.

Speaker #3: I mean, I think as we're rolling contracts, in theory, by contract we always trade off. I mean, as we're negotiating revenue share, we trade off volume with that rev share to see—because we're looking for total margin.

Speaker #3: I'm not sitting here—if you're questioning, am I sitting here worried about it? No, I'm not. I'm very comfortable with the deals we're negotiating at the moment.

Speaker #3: And the rev share split, and the volume split, and what type of volume we're getting out—actually, maybe that is a very, very good point.

Speaker #3: And I will make and I want to talk about GPUs because the rev share on a GPU will absolutely be lower in percentage terms than the rev share on a DDR4.

Speaker #3: The GPUs that are going to be coming out over the next 12 months and beyond are extraordinarily valuable. We will do a lot of testing on them in real-world situations, to determine if they can be either repurposed or resold.

Stephen Mikkelsen: We will do a lot of testing on them in the real-world situation for them to be either repurposed or resold. Clearly, we are not going to get a 25% to 30% rev share on those because the value of them is just extraordinarily higher. But the opportunity for absolute margin is very strong.

Speaker #3: And clearly, we're not going to get a 25–30% rev share on those, because the value of them is just extraordinarily higher. But the opportunity for absolute margin is very, very strong.

Speaker #4: Yeah, that's really helpful. And maybe just digging into that slightly more, if we think about the opportunity for EBIT in SLS, how do you think about GPUs as a new product focus for your business?

Brook Campbell-Crawford [Director of Research: Yeah. That's really helpful. Maybe just digging into that slightly more. If we think about the opportunity for EBIT in SLS, how you think about GPU as a new product focus for your business, how could that compare to memory? I guess if you think of maybe internally, there's some sort of rough split.

[Analyst] (Barrenjoey): Yeah. That's really helpful. Maybe just digging into that slightly more. If we think about the opportunity for EBIT in SLS, how you think about GPU as a new product focus for your business, how could that compare to memory? I guess if you think of maybe internally, there's some sort of rough split.

Speaker #4: And how could that compare to memory? I guess if you think of me in terms of some sort of rough split, how do you see it?

Stephen Mikkelsen: Yeah

Brook Campbell-Crawford [Director of Research: How you see settling that.

[Analyst] (Barrenjoey): How you see settling that.

Speaker #3: Yeah, yeah. I mean, yep. That's a good question. I see GPUs as a bigger opportunity than DDR4s for a couple of reasons. One is—three reasons, actually.

Stephen Mikkelsen: Yep. That's a good question. I see GPUs as a bigger opportunity than DDR4s for a couple of reasons. One is, three reasons actually. One is the complexity of repurposing them is an order of magnitude higher than what we do today. Therefore, the relationships you have with customers, the R&D work you've put in creates an even bigger moat around it. I see that as very important. Secondly, the volume of GPUs that needs to come out is extraordinarily large over the next one, two, three, four years. Thirdly, the value of those GPUs is extremely high as well. Fourthly, and this one, I think we are generally still thinking about it. There may be a bias in these new GPUs for them to be resold. We'll have to see, because whether or not AI want them back in.

Speaker #3: One is, the complexity of repurposing them is an order of magnitude higher than what we do today. So, therefore, the relationships you have with customers and the R&D work you've put in create an even bigger moat around it.

Speaker #3: So I see that as very, very important. Secondly, the volume of GPUs that need to come out is extraordinarily large over the next one, two, three, four years.

Speaker #3: And thirdly, the value of those GPUs is extremely high as well. Fourthly—and this one, I think we're generally still thinking about it.

Speaker #3: There may be a bias in these new GPUs for them to be resold. We'll have to see. Because whether or not AI want them back, and are they going to be—are they going to be good enough for the compute, that really fast compute they need?

Stephen Mikkelsen: Are they going to be good enough for the compute, that really fast compute they need? I'm not sure for the massive type of scales. But they're certainly going to be good enough for a huge number of potential customers globally. I see GPUs opportunity as larger than the DDR4 opportunity and the DDR5 opportunity.

Speaker #3: I'm not sure. For massive hyperscalers, but they're certainly going to be good enough for a huge number of potential customers globally. So I see GPUs' opportunity as larger than the DDR4 opportunity.

Speaker #3: And the DDR5 opportunity.

Speaker #4: Okay, great. Thanks for all the comments. Appreciate it.

Brook Campbell-Crawford [Director of Research: Okay, great. Thanks for your call. Appreciate it.

[Analyst] (Barrenjoey): Okay, great. Thanks for your call. Appreciate it.

Speaker #2: Thank you. Your next question comes from Scott Ryle from Rimma Equity Research. Please go ahead.

Operator: Thank you. Your next question comes from Scott Ryle from Remer Equity Research. Please go ahead.

Operator: Thank you. Your next question comes from Scott Ryle from Rimor Equity Research. Please go ahead.

Speaker #4: Hi there, thank you very much. Stephen, the first one is hopefully very quick. Corporate costs—you had a good decline this year. Is there further decline that you expect you can deliver over the next couple of years, please?

Scott Ryle: Hi there. Thank you very much. Stephen, the first one's hopefully very quick. Corporate costs, you had good decline this year. Is there further declines that you expect you can deliver over the next couple of years, please?

[Analyst] (Rimor Equity Research): Hi there. Thank you very much. Stephen, the first one's hopefully very quick. Corporate costs, you had good decline this year. Is there further declines that you expect you can deliver over the next couple of years, please?

Speaker #3: I will flick that one to Warrick, who's been working hard on this.

Stephen Mikkelsen: I will flick that one to Warrick, who's been working hard on this.

Speaker #4: Yeah, I mean, I think we're continuing to chip away there, Scott. So I'd hope to see some further reduction. We do have project costs in there.

Warrick Ranson: Yeah. I think it's. We continue to chip away there, Scott, so I'd hope to see some further reduction. We do have project costs in there, so they will come out in this H1.

Speaker #4: So they will come out in this half. We start—well, not totally, but partially—come out in this half as we move to implementation of that new metal software.

Stephen Mikkelsen: Not totally, but partially come out in this H1 as we move to implementation of that new metal software. So yes, you'll continue to see a reduction in that, and we continue to look at opportunities across the board.

Warrick Ranson: Not totally, but partially come out in this H1 as we move to implementation of that new metal software. So yes, you'll continue to see a reduction in that, and we continue to look at opportunities across the board.

Speaker #4: So yes, you'll continue to see a reduction in that, and we continue to look at opportunities across the board. Okay, so can I just confirm there?

Scott Ryle: Okay. So can I just confirm there, you would expect to see. So if you've got a negative AUD 114 million of EBITDA, that number should be closer to zero than what it is. As in it will reduce as a loss in 2027. Is that fair?

[Analyst] (Rimor Equity Research): Okay. So can I just confirm there, you would expect to see. So if you've got a negative AUD 114 million of EBITDA, that number should be closer to zero than what it is. As in it will reduce as a loss in 2027. Is that fair?

Speaker #4: You would expect to see so, if you've got a negative $114 million of EBITDA, that number should be closer to zero than what it is, as in, it will reduce as a loss in 2027.

Speaker #4: Is that fair?

Speaker #3: Correct. That would be our intention.

Stephen Mikkelsen: Correct. That would be our intention.

Speaker #4: Okay. Okay, great. And then my second question is probably for Rob. I'd just be interested, now that you've got the North American business looking a lot healthier, and you've talked about the tailwinds from EAS and the strength of non-ferrous pricing,

Scott Ryle: Okay, great. My second question, probably for Rob. I would just be interested now you have the North American business in a. Obviously, it looks a lot healthier and you have talked about the tailwinds from EAFs and the strength of non-ferrous pricing. I am just wondering now, does this give you a little bit of time now or an opportunity perhaps to think about positioning the business for the next three to five years? Maybe it is taking out some of the cyclicality, maybe it is improving what you think is trough earnings. But how are you thinking on the kind of medium to long-term of positioning yourself for both ferrous in the context of EAFs and the opportunities that come with non-ferrous volumes attached to that, but also there has got to be opportunities outside of just collection of scrap metal for non-ferrous as well, I would have thought.

[Analyst] (Rimor Equity Research): Okay, great. My second question, probably for Rob. I would just be interested now you have the North American business in a. Obviously, it looks a lot healthier and you have talked about the tailwinds from EAFs and the strength of non-ferrous pricing. I am just wondering now, does this give you a little bit of time now or an opportunity perhaps to think about positioning the business for the next three to five years? Maybe it is taking out some of the cyclicality, maybe it is improving what you think is trough earnings. But how are you thinking on the kind of medium to long-term of positioning yourself for both ferrous in the context of EAFs and the opportunities that come with non-ferrous volumes attached to that, but also there has got to be opportunities outside of just collection of scrap metal for non-ferrous as well, I would have thought.

Speaker #4: I'm just wondering now, does this give you a little bit of time now, or an opportunity perhaps, to think about positioning the business for the next three to five years? Maybe it's taking out some of the cyclicality, maybe it's improving what you think is trough earnings?

Speaker #4: But how do you think, on a kind of medium- to long-term basis, about positioning yourself for both ferrous in the context of EAS, and the opportunities that come with non-ferrous volumes attached to that? But also, there's got to be opportunity outside of just collection of scrap metal for non-ferrous as well, I would have thought?

Speaker #3: Right. Yeah. I think NAM is definitely in a position now. Foundationally, I think there are solid results from the investments we've made and the efforts we've made to diversify from largely an export-based company from a ferrous perspective.

Rob Thompson: Right. Yeah, I think NAM is definitely in a position now. Foundationally, I think solid results with the investments we have made, with the efforts we have made to diversify from largely an export-based company from a ferrous perspective to having the supply chain and logistics capabilities that we have invested in. Our diversification, I guess, has grown beyond my expectations in terms of our ability to optimize on a monthly or quarterly cadence. We will continue to leverage that. The demand in the US, we will not ignore. The customer's customer as Stephen has explained, it is a good environment, good economy, but the data center environment is just putting it on hyperdrive for us.

Speaker #3: To having the supply chain and logistics capabilities that we've invested in. Our diversification, I guess, has grown beyond my expectations in terms of our ability to optimize on a monthly or quarterly cadence.

Speaker #3: So, we'll continue to leverage that. The demand in the US—we will not ignore the customer's customer, as Stephen has explained. It's a good environment, a good economy, but the data center environment is just putting it on hyperdrive for us.

Speaker #3: So now that we've stabilized and, I'd say, earned the right to kind of grow again—much along the lines of SAR—I think the right opportunities at the right time for tuck-ins to continue to utilize the deployed capital we already have in the market in North America, with our shredding aluminum capacity, with AlumaSource, and the granulators that we have on site.

Rob Thompson: Now that we have stabilized and I would say earned the right to kind of grow again, much along the lines of SA Recycling, I think the right opportunities at the right time for tuck-ins to continue to utilize the deployed capital we already have in the market, in North America with our shredding aluminum capacity, with Sims Alumisource and the granulators that we have on site. We will continue to look for those opportunities and grow in the market.

Speaker #3: We'll continue to look for those opportunities and grow in the market.

Speaker #4: Okay. Great. Thank you.

Scott Ryle: Okay, great. Thank you.

[Analyst] (Rimor Equity Research): Okay, great. Thank you.

Speaker #2: Thank you. Your next question comes from Harry Saunders from A&P. Please go ahead.

Operator: Thank you. Your next question comes from Harry Saunders from E&P. Please go ahead.

Speaker #4: Morning. Thanks for taking my questions. Just on SLS again, looking at it a slightly different way, we look at the moving parts getting to that guide in the first half.

Harry Saunders: Morning. Thanks for taking my questions. Just on SLS again, looking at it a slightly different way. We look at the moving parts getting to that guide in the H1. There is volume, there is other factors, and it looks like the memory price that you have referenced previously, if anything, has strengthened into the half. Just trying to figure out what those moving parts are in broad buckets, and then maybe what is a more normalized figure, do you think, for this business? Can you then factor in the uplift from Ireland, because presumably Ireland is kind of contributing there? Thanks.

Speaker #4: There's volume, there are other factors, and it looks like the memory price that you've referenced previously, if anything, has strengthened into the half. So just trying to figure out what those moving parts are, in broad buckets.

Speaker #4: And then, maybe, what is a more normalized figure, do you think, for this business? Can you then factor in the uplift from Ireland, because presumably Ireland is kind of contributing to things?

Speaker #3: Yeah. So the biggest driver for the first half of 2027 is the DDR4s that have come out that we're selling, of a lower speed.

Stephen Mikkelsen: Yeah. The biggest driver for the H1 of FY27 is the DDR4 that have come out that we are selling are of a lower speed. Therefore, the discount that they are to the new is a higher discount. So in the chart that we have traditionally shown, I am now doing this off the tip. I think the speed of those are 3,300 or 3,600. 3,000 something hundred.

Speaker #3: And so, therefore, the discount that they are to the new is a high discount. So, when we, in the chart that we've traditionally shown—I'm now doing this off the tip.

Speaker #3: I think the speed of those are 3,300 or 3,600—three thousand something hundred.

Ana Metelo: 200.

Speaker #4: 2,000.

Speaker #3: 3,200. Okay, thanks. So, the DDR4s that we're selling in the first half, the ones that have come out, they are of lower speed, which is kind of intuitively correct, because if your refresh cycle is being delayed because of various blockages or your new sites are being delayed because of various blockages, you're going to be pulling out the less valuable stuff first.

Stephen Mikkelsen: 3,200. Okay, thanks. The DDR4s that we are selling in H1, the ones that have come out, they are of lower speed, which is kind of intuitively correct. Because if your refresh cycle is being delayed because of various blockages or your new sites are being delayed because of various blockages, you are going to be pulling out the less valuable stuff first, and that will continue to come out. That is the biggest driver, I think, on H1 2027 versus H2 2026. Nothing else material has changed other than that. That is why I guess I get some confidence. You talk about what is normalized going forward. I think it is very hard to do normalized because we are in a high-growth business. Where I get confidence from that is the high-speed stuff, the DDR5s and the DDR4s, all that is still to come out.

Speaker #3: And that will continue to come out, so that's the biggest driver, I think, on first half 2027 versus second half 2026. Nothing else material has changed.

Speaker #3: Other than that—and that's why, I guess, I get some confidence—you talk about what's normalized going forward. I think it's very hard to do 'normalized' because we're in a high-growth business.

Speaker #3: And so, where I get confidence from is that the high-speed stuff—the DDR5s and the DDR4s—all that's still to come out. And that will come out sometime after December 2026.

Stephen Mikkelsen: That will come out sometime after December 2026. Here, unfortunately, I cannot say, "Here is your normalized base," because we just need to see those decommissioning schedules. As they get back into the high-quality material that they have done in FY26, as that starts coming out again, the prices are still. As you have noted, prices are still very, very strong. There has been no indication that those prices are falling. There has been no indication that demand for DDR4s are falling. I have not given you a specific answer of what is the normalized earnings, but I think normalized earnings and SLS is a very hard concept because what is going to drive the future is higher quality, more sophisticated material coming out.

Stephen Mikkelsen: That will come out sometime after December 2026. Here, unfortunately, I cannot say, "Here is your normalized base," because we just need to see those decommissioning schedules. As they get back into the high-quality material that they have done in FY 2026, as that starts coming out again, the prices are still. As you have noted, prices are still very, very strong. There has been no indication that those prices are falling. There has been no indication that demand for DDR4s are falling. I have not given you a specific answer of what is the normalized earnings, but I think normalized earnings and SLS is a very hard concept because what is going to drive the future is higher quality, more sophisticated material coming out.

Speaker #3: So unfortunately, I can't say. So here's your normalized base because we just need to see those decommissioning schedules. And as they get into the higher quality back into the high-quality material that they've done in FY2026, as that starts coming out again, the prices are still as you've noted, prices are still very, very strong.

Speaker #3: And there's been no indication that those prices are falling. There's been no indication that demand for DDR4s is falling. So, I haven't given you a specific answer of what the normalized earnings are, but I think normalized earnings and SLS is a very hard concept because what's going to drive the future is higher quality, more sophisticated material coming out.

Speaker #4: Got it. I guess we're just trying to understand that, because there's a huge swing from that second half to the first half. So, whether the second half was over-earning, perhaps—appreciate your referencing a different speed, but maybe you were selling more to the higher speed than is a normal kind of level of sale.

Harry Saunders: But I guess we are just trying to understand that because there is a huge swing from that H2 to the H1. Whether the H2 was over-earning, perhaps it. Appreciate you referencing a different speed, but maybe you were selling more to the higher speed than is a normal kind of level of sale. Also just trying to figure out what the Ireland contribution in that number.

Speaker #4: And then also just trying to figure out what the Ireland contribution is.

Speaker #3: Yeah. So, what I would say now is what we're selling now is less than normal in terms of mix, because we're selling more of the low-speed stuff.

Stephen Mikkelsen: What I would say now is what we are selling now is less than normal in terms of mix, because we are selling more of the low-speed stuff. I would say it is less, not more. Ireland is not contributing much at all to the H1 because it was set up and is up and really running more for the high-speed DDR4s that were expected to come out. They will come out. I mean, it is not that they are not coming out. Ireland is not contributing a lot in the H1 at all because the DDR4s that it was going to repurpose, resell, have not come out yet.

Speaker #3: So I'd say it's less, not more. And Ireland is not contributing much at all to the first half because it was being set up and is up and really running more for the high-speed DDR4s that were expected to come out.

Speaker #3: They will come out. I mean, it's not that they're not coming out, but so Ireland's not contributing a lot in the first half at all, because the DDR4s that it was going to repurpose and resell haven't come out yet.

Speaker #4: Thanks. And just to follow up on SAR, given that enormous step up in the second half—first, I mean, is that a sensible run rate going forward, or is there anything else to sort of bear in mind in that number that we need to normalize for?

Harry Saunders: Thanks. Just to follow up on SA Recycling, given that enormous step up in the H2 versus H1, is that a sensible run rate going forward, or is there anything else to bear in mind in that number that we need to normalize for? Thanks.

Speaker #4: Thanks.

Stephen Mikkelsen: So volume-wise, I do not think there was anything particularly special in the H2. I think it is the type of volumes that SA Recycling can absolutely do. So it really is price. I would go, and let us be really clear, non-ferrous, Zorba prices, copper, aluminum are the drivers. I guess what we are seeing, and again, this is an opinion because it is kind of like a global opinion. It is do you see anything driving down the value of non-ferrous? We do not see anything driving down the value of non-ferrous, but I am sure you and your research teams will have your own view. I guess what I am saying is there was nothing special about volume. It is about non-ferrous pricing. What do you see as non-ferrous pricing over FY27 is going to be the key as to whether or not they can repeat that result.

Speaker #3: So, volume-wise, I don't think there was anything particularly special in the second half. I think it's the type of volumes that SAR can absolutely do.

Speaker #3: So it really is price, and I would go, and this would be really clear: non-ferrous Zorba prices, copper, aluminium, are the drivers. And I guess what we're seeing—and again, this is an opinion, because it's kind of like a global opinion.

Speaker #3: Do you see anything driving down the value of non-ferrous? We don't see anything driving down the value of non-ferrous, but I'm sure you and your research teams will have your own view.

Speaker #3: I guess what I'm saying is, there was nothing special about volume—it's about non-ferrous pricing. What do you see as non-ferrous pricing over FY27? That's going to be the key as to whether or not they can repeat that result.

Speaker #3: And frankly, it's the same with NAM and it's the same with ANZ. None of them are different. Although, maybe ANZ is slightly different.

Stephen Mikkelsen: Frankly, it is the same with NAM, and it is the same with ANZ. None of them are different. Maybe ANZ is slightly different. Do you see something happening with China and ferrous? That would impact ANZ. But the volume that NAM did in that H2, very sustainable, Rob. I do not see. There is nothing particularly, like there was no one-offs that you think that cannot repeat itself. So it is about the margins that we are making on non-ferrous Zorba, and I guess in particular, and I think we do not see anything driving that down in FY27.

Speaker #3: Do you see something happening with China and ferrous that would impact ANZ? But NAM's volumes—the volume that NAM did in that second half—is that very sustainable, Rob?

Speaker #3: I don't see there's anything particularly—like, there were no one-offs that you think can't repeat itself. So, it's about the margins that we're making on non-ferrous Zorba, and I guess in particular.

Speaker #3: And I think we don't see anything driving that down in FY27.

Speaker #4: Thanks.

Harry Saunders: Thanks.

Speaker #2: Thank you. Your next question comes from Chen Zheng from Bank of America. Please go ahead.

Operator: Thank you. Your next question comes from Qian Zheng from Bank of America. Please go ahead.

Operator: Thank you. Your next question comes from Qian Zhang from Bank of America. Please go ahead.

Speaker #5: Hi, good morning Stephen and Warrick. Thanks for taking my question. Most questions have been asked. Just again, a follow-up on the SLS—to give us, I guess, more conviction that your earnings growth from SLS is deferred further, rather than disappeared, over the near term.

Qian Zheng: Good morning, Stephen and Warrick. Thanks for taking my question. Most questions have been asked. Just, again, follow up on the SLS to give us, I guess, more conviction, your earnings growth from SLS is deferred further rather than disappeared in the near term. To summarize, from your answers, it seems like, over the next six to 12 months, you will be selling less DDR4 high margin, and your customers are taking more in-house for repurposing because your repurposing units volume continue to grow and the price is strong. Is that how I should read it from all your answers? Thank you.

[Analyst] (Bank of America): Good morning, Stephen and Warrick. Thanks for taking my question. Most questions have been asked. Just, again, follow up on the SLS to give us, I guess, more conviction, your earnings growth from SLS is deferred further rather than disappeared in the near term. To summarize, from your answers, it seems like, over the next six to 12 months, you will be selling less DDR4 high margin, and your customers are taking more in-house for repurposing because your repurposing units volume continue to grow and the price is strong. Is that how I should read it from all your answers? Thank you.

Speaker #5: So, to summarize from your answers, it seems that over the next 6 to 12 months you will be selling less DDR4 high-margin, and your customers are taking more in-house for repurposing.

Speaker #5: Because your repurposing units volume continues to grow and the price is strong, is that how I should rate it from all your answers?

Speaker #5: Thank you.

Speaker #3: Yeah, so there's a few things. The one thing I would say is that we haven't seen that DDR4 high volume will be less in the second half.

Stephen Mikkelsen: Yeah. So there's a few things. The one thing I would say is that, we haven't said that DDR4 high volume will be less in H2. We've said it will be less in H1, and we have line of sight for that. How quickly it recovers after that, it may well recover in H2. It may take 2028 before it recovers. That will entirely depend on how our various customers, do they secure connections? Do they secure the DDR5s that they need so that they can refresh and take out DDR4s? Let me be really clear, we're not saying that's not going to happen in H2. Then the mix of it, I don't think that's going to particularly change in FY27. I think what I've said is beyond FY27, I think more of the DDR4s, and this is a view here.

Speaker #3: We've seen it will be less in the first half, and we have line of sight for that. How quickly it recovers after that—it may well recover in the second half.

Speaker #3: It may take 2028 before it recovers. That will largely depend—no, that will entirely depend—on how various customers do: do they secure connections, do they secure the DDR5s that they need so that they can refresh and take out DDR4s.

Speaker #3: I'm not saying we're really clear. We're not saying that's not going to happen in the second half. Then, the mix of it—I don't think that's going to particularly change in FY27.

Speaker #3: I think what I've said is, beyond FY27—beyond FY27—I think more of the DDR4s, and this is a view here, more of the DDR4s will end up in the resale market because it'll be DDR5s that are getting more repurposed back into the data centers.

Stephen Mikkelsen: More of the DDR4s will end up in the resale market because it'll be DDR5s that are getting more repurposed back into the data centers. Believe me, the world needs DDR4s in the resale market because all the market commentary says that DDR4s are needed right through to beyond 2028, 2029.

Speaker #3: Believe me, the world needs DDR4s in the resale market because all the market commentary says that DDR4s are needed right through to beyond 2028, 2029.

Speaker #5: Sure, sure. So basically, are you saying your customers are taking more in-house because your repurposing units are growing, whereas you are selling less?

Qian Zheng: Sure. So basically, are you saying your customers are taking more in-house because your repurposing units are growing, whereas you are selling less?

[Analyst] (Bank of America): Sure. So basically, are you saying your customers are taking more in-house because your repurposing units are growing, whereas you are selling less?

Speaker #5: So, whereas the resale has higher margin.

Qian Zheng: the-

[Analyst] (Bank of America): the-

Stephen Mikkelsen: Okay. Yeah.

Qian Zheng: Resale has higher margin.

[Analyst] (Bank of America): Resale has higher margin.

Speaker #3: Yeah. So think about—yeah, so a lot of our repurposing unit growth was for non-memory parts. There are lots of parts that get repurposed. And add to that, DDR3s as well.

Stephen Mikkelsen: Yeah. A lot of our repurposing unit growth was for non-memory parts. There are lots of parts that get repurposed, and add to that DDR3s as well. So between those two, there was a lot of DDR3s in FY26. DDR3s are not going to come out in any significant way from now on. It is DDR4s and DDR5s. So I do not think you can say. Let me make it really clear. You cannot conclude that therefore our customers are taking more back into the business as opposed to reselling. Right now, we are not seeing any particular variation between those two from what we have seen historically.

Stephen Mikkelsen: Yeah. A lot of our repurposing unit growth was for non-memory parts. There are lots of parts that get repurposed, and add to that DDR3s as well. So between those two, there was a lot of DDR3s in FY 2026. DDR3s are not going to come out in any significant way from now on. It is DDR4s and DDR5s. So I do not think you can say. Let me make it really clear. You cannot conclude that therefore our customers are taking more back into the business as opposed to reselling. Right now, we are not seeing any particular variation between those two from what we have seen historically.

Speaker #3: So between those two, I mean, there was a lot of DDR3s in FY26. They're not going to—I mean, DDR3s are not going to come out in any significant way from now on.

Speaker #3: It's DDR4s and DDR5. So I don't think you can say no. Let me make it really clear: You cannot conclude that, therefore, our customers are taking more back into the business as opposed to reselling.

Speaker #3: We're not seeing any particular variation right now; we're not seeing any significant difference between those two from what we've seen historically.

Speaker #5: Yeah. So that DDR4 sales is more like a timing thing, deferred further into your, whatever medium term you mentioned.

Qian Zheng: Yeah. That DDR4 sales, is that more like a timing thing, deferred further into your medium term, you mentioned?

[Analyst] (Bank of America): Yeah. That DDR4 sales, is that more like a timing thing, deferred further into your medium term, you mentioned?

Speaker #3: Yeah, DDR4s are definitely timing. There hasn't—100% agree—there hasn't suddenly, there's no DDR4s in the world that need to be taken out of data centers.

Stephen Mikkelsen: Yeah. DDR4s are definitely timing. 100% agree. There's no DDR4s in the world that need to be taken out of data centers. In fact, that installation happened 2 or 3 years ago. It's not less DDR4s, it's simply the timing of when are they going to come out.

Speaker #3: In fact, that installation happened two or three years ago. So, it's not fewer DDR4s; it's simply a matter of timing—of when they are going to come out.

Speaker #5: Okay, got it. So, deferred further. Okay. And then, if I can ask about your North America Metals Recycling business—because comparing your FY26 EBITDA versus the market mean consensus, I think it's weaker than expected.

Qian Zheng: Okay. Got it. Deferred further. If I can ask about your North America Metals recycling business, because comparing NAM, your FY26 EBIT versus the market, consensus, I think it's way worse than expected. But looking at your sales volume seems okay because US steel production has been, I guess, strong year-over-year because of the tariff. Now looking at non-ferrous price, copper and Zorba, which is the secondary aluminum price, they are strong, which reflected in your JV, SA Recycling's EBIT. Everyone ask about it. It's very strong. That's how the EBIT should be. You continue to implement your turnaround strategy.

[Analyst] (Bank of America): Okay. Got it. Deferred further. If I can ask about your North America Metals recycling business, because comparing NAM, your FY 2026 EBIT versus the market, consensus, I think it's way worse than expected. But looking at your sales volume seems okay because US steel production has been, I guess, strong year-over-year because of the tariff. Now looking at non-ferrous price, copper and Zorba, which is the secondary aluminum price, they are strong, which reflected in your JV, SA Recycling's EBIT. Everyone ask about it. It's very strong. That's how the EBIT should be. You continue to implement your turnaround strategy.

Speaker #5: But looking at your sales volume, it seems okay because US steel production has been, I guess, strong year over year because of the tariff. And then now looking at non-ferrous price—copper and Zorba, which is the secondary aluminum prices—they're strong, which is reflected in your JV SR eBay.

Speaker #5: Everyone asked about it. It's very strong. That's how eBay should be. And then you continue to implement your turnaround strategy. So, I'm just trying to understand what happened to the North America metals for FY26. I mean, everyone has their own assumption for non-ferrous, but how should we think about it?

Qian Zheng: I'm just trying to understand what happened to the North America Metals for the FY26 and everyone has their own assumption for non-ferrous, but how should we think about it over the next 6 to 12 months, especially your turnaround strategy? Thank you.

[Analyst] (Bank of America): I'm just trying to understand what happened to the North America Metals for the FY 2026 and everyone has their own assumption for non-ferrous, but how should we think about it over the next 6 to 12 months, especially your turnaround strategy? Thank you.

Speaker #5: Over the next 6 to 12 months, especially regarding your turnaround strategy. Thank you.

Stephen Mikkelsen: Yeah. Broadly speaking, there's one slide in particular that Warrick showed, which showed the contribution from non-ferrous versus ferrous between FY25 and FY26. I cannot remember what slide it was. What it shows is the two big stories in FY26 were the contribution from non-ferrous and the contribution from SLS were the big growth drivers for the business. How you should think about North America and SA Recycling, relatively speaking, SA Recycling is benefiting more at the moment than North America because it produces more Zorba. As I said, it's not at zero marginal cost, but Zorba comes at a very low marginal cost. As the price rises, it tends to fall straight to the bottom line, from an EBITDA and an EBIT perspective. NAM is proportionally doing just as well out of non-ferrous as SA Recycling.

Stephen Mikkelsen: Yeah. Broadly speaking, there's one slide in particular that Warrick showed, which showed the contribution from non-ferrous versus ferrous between FY25 and FY 2026. I cannot remember what slide it was. What it shows is the two big stories in FY 2026 were the contribution from non-ferrous and the contribution from SLS were the big growth drivers for the business. How you should think about North America and SA Recycling, relatively speaking, SA Recycling is benefiting more at the moment than North America because it produces more Zorba. As I said, it's not at zero marginal cost, but Zorba comes at a very low marginal cost. As the price rises, it tends to fall straight to the bottom line, from an EBITDA and an EBIT perspective. NAM is proportionally doing just as well out of non-ferrous as SA Recycling.

Speaker #3: Yeah, so broadly speaking, I mean, both—at least, there’s one slide in particular that Warrick showed, which displayed the contribution from non-ferrous versus ferrous between FY25 and FY26. I can’t remember which slide it was, but what it shows is that the two big stories in FY26 were the contribution from non-ferrous and the contribution from SLS, which were the big growth drivers for the business.

Speaker #3: How you should think about North America and SAR, relatively speaking, is that SAR is benefiting more at the moment than North America because it produces more zoba.

Speaker #3: And as I said, Zoba comes—it's not at zero marginal cost, but Zoba comes at a very low marginal cost. So if the price rises, it tends to fall straight to the bottom line.

Speaker #3: From an EBITDA and EBIT perspective, NAM is proportionally doing just as well out of non-ferrous as SA Recycling. It's just that SA Recycling produces more of it.

Stephen Mikkelsen: It's just SA Recycling produces more of it on the Zorba side. The second thing I'd add, because it's got roughly twice the number of feeder yards that we have in NAM, they also do very well out of non-ferrous retail. Non-ferrous retail is just plumbers bringing in copper guttering and electrician dropping off some copper cabling that they picked up. Then we process that into high-quality non-ferrous product. So I wouldn't be thinking that SA Recycling has got something that NAM doesn't. What SA Recycling has is twice as many shredders and twice as many yards providing this non-ferrous product.

Speaker #3: On the Zoba side, and then the second thing I'd add—because it's got roughly twice the number of feeder yards that we have in NAM—they also do very well out of non-ferrous retail.

Speaker #3: And non-ferrous retail is just plumbers bringing in copper guttering, and electricians dropping off some cable and some copper cabling that they picked up. Then we process that into high-quality non-ferrous product.

Speaker #3: So, I wouldn't be thinking that SA Recycling has got something that NAM doesn't. What SA Recycling has is twice as many shredders and twice as many yards providing this non-ferrous product.

Qian Zheng: Right. Thanks, Stephen. So comparing your JV-operated SAR with your NAM, so basically from your answers, there's not much difference, but you believe they have more high margin, like Zorba from non-ferrous metals, which give them higher margins. Is that-

[Analyst] (Bank of America): Right. Thanks, Stephen. So comparing your JV-operated SAR with your NAM, so basically from your answers, there's not much difference, but you believe they have more high margin, like Zorba from non-ferrous metals, which give them higher margins. Is that-

Speaker #5: Right. Thanks, Stephen. So comparing S your JV operated SAR with your NAM, so basically from your answers, there's not much difference, but you believe they have more high margin like a zoba non-ferrous metals, which give them higher margins.

Speaker #5: Is that.

Stephen Mikkelsen: That is-

Speaker #3: That is.

Qian Zheng: conclusion?

[Analyst] (Bank of America): conclusion?

Speaker #5: Conclusion?

Stephen Mikkelsen: That is correct. They shred more, therefore produce more Zorba, and Zorba has a very low fuel run marginal cost, and so that has impacted them in a positive way. It's impacted NAM in exactly the same positive way, just less volume.

Speaker #3: That is correct. They shred more, and therefore produce more zoba, and zoba has a very low short-run marginal cost. And so that has impacted them in a positive way.

Speaker #3: It's impacted them in exactly the same positive way, just with less volume.

Speaker #5: Right. And do you benefit from higher US domestic steel production, which we've seen yesterday because of tariffs, as well as from alloy prices and copper prices in the US?

Qian Zheng: Right. You are benefiting from higher US domestic steel production, which we've seen yesterday because of tariff as well as from ali-

[Analyst] (Bank of America): Right. You are benefiting from higher US domestic steel production, which we've seen yesterday because of tariff as well as from ali-

Stephen Mikkelsen: Yes

Qian Zheng: prices and the copper prices in the US.

[Analyst] (Bank of America): prices and the copper prices in the US.

Stephen Mikkelsen: Yes.

Speaker #5: All right. Thank you, Stephen. I'll pass it on. Oh, sorry, you go. No, no, no, sorry.

Qian Zheng: All right.

[Analyst] (Bank of America): All right.

Stephen Mikkelsen: That's correct.

Qian Zheng: Thank you, Stephen. I will pass it on.

[Analyst] (Bank of America): Thank you, Stephen. I will pass it on.

Stephen Mikkelsen: Okay. Thanks.

Qian Zheng: Oh, sorry. You go. No, sorry. To Juwon.

[Analyst] (Bank of America): Oh, sorry. You go. No, sorry. To Juwon.

Speaker #3: Sure.

Stephen Mikkelsen: Sure.

Speaker #2: Thank you. Your next question comes from Daniel Sykes from Jordan. Please go ahead.

Operator: Thank you. Your next question comes from Daniel Sykes from Jarden. Please go ahead.

Speaker #3: Hi, guys. Thanks for taking my questions. I was just wondering if you could give us a bit of a timeline around some of the other hardware components you're talking about in SLS.

Daniel Sykes: Hi, guys. Thanks for taking my questions. I was just wondering if you would give us a bit of a timeline around some of the other hardware components you are talking about in SLS, particularly the GPUs and the market opportunity there, just in terms of any significant milestones we should expect in terms of testing whether they can be resold, any contracts and-

Speaker #3: And particularly the GPUs and the market opportunity there. Just in terms of any significant milestones we should expect in terms of testing whether they can be resold, any contracts, and when they'll hit the finances as well.

Stephen Mikkelsen: Yeah

Daniel Sykes: when they will hit the financials as well.

Stephen Mikkelsen: Yeah. So, we have some of them in our HQ facility right now. Some of these high-quality ones, and we are working on them at the moment, testing them in a real-world environment. So that is a very important step. We have already developed three or four tests and have proven that based on those tests, we can certify these things to a certain level. In the next, I would say around about from 12 months from now, there is going to be another step up in the quality and sophistication of what is coming out. So it really is, for me, it is starting now, and it will ramp up in the next 12 months or so. But what I would say is we are very well-positioned to be sitting in that market, testing and certifying GPUs. And that is what this market is going to be about. GPUs are not like DIMMs.

Speaker #3: Yeah. So, we have some of them in our HQ facility right now—some of these high-quality ones. And we're working on them at the moment, testing them in a real-world environment.

Speaker #3: So that's a very important step. We've already developed three or four tests, and have proven that, based on those tests, we can certify these things to a certain level.

Speaker #3: In the next, I'd say, around about 12 months from now, there's going to be another step up in the quality and sophistication of what's coming out.

Speaker #3: So, really, for me, it's starting now, and it will ramp up in the next 12 months or so. But what I would say is, we are very well positioned to be sitting in that market, testing and certifying GPUs.

Speaker #3: And that's what this market is going to be about. GPUs are not like DIMMs. If a DIMM fails, it's not the end of the world.

Stephen Mikkelsen: If a DIMM fails, it is not the end of the world. And the testing that you do on DIMMs is relatively simple. DDR5s are neither of those things. They are more fragile. The tests are more complicated. That is why they are worth more, and that is why you need to have the skill to do it, and I do believe we are really well-positioned. It is just starting from now, ramping up over a 12-month period is the way I am seeing it.

Speaker #3: And the testing that you do on a DIMM is relatively simple. DDR5s are neither of those things; they are more fragile. The tests are more complicated.

Speaker #3: That's why they're worth more, and that's why you need to have the skill to do it. And I do believe we're really well positioned.

Speaker #3: It's a starting-from-now, ramping up over a 12-month period, is the way I'm seeing it.

Speaker #1: Great, thanks. And do you see anyone, I mean, in the market doing this already? I know on the memory side you kind of talked to hyperscalers being the number one competitor there and what they do in-house.

Daniel Sykes: Great. Thanks. Do you see anyone in the market doing this already? I know on the memory side, you talked to hyperscalers being the number one competitor there and what they do in-house. Is that the same on this side, or is there anyone you would point to?

Speaker #1: Is that the same on this side, or is there anyone you would point to?

Speaker #3: This is new. This is new. And we've recently written quite a good white paper on some of this stuff as well. I mean, I'm not going to say there's no one out there doing it, because it's hard to know what people are doing.

Stephen Mikkelsen: This is new. We have recently written quite a good white paper on some of this stuff as well. I am not going to say there is no one out there doing it, because it is hard to know what people are doing behind closed doors. But I do believe that we are at the forefront of it because we have been, particularly with one of our customers, we have been working on this for a while. That customer has a particularly strong focus on sustainability and making sure that stuff is not going to landfill. So we have been working on it for quite a while, and I feel we are in a good position. We are never going to have a world monopoly on it. That would be lovely, but highly unlikely. But this takes it to another level of sophistication versus DDR4s and DDR5s.

Speaker #3: Behind closed doors. But I do believe that we are at the forefront of it because we've been, particularly with one of our customers, working on this for a while.

Speaker #3: And that's on sustainability and making sure that stuff's not going to landfill. So we've been working on it for quite a while, and I feel we're in a good position.

Speaker #3: I mean, we're never going to—I mean, we're never going to have a world monopoly on it. That would be lovely, but highly unlikely.

Speaker #3: But this takes it to another level of sophistication versus DDR4s and DDR5s.

Speaker #1: Okay. Great. Thank you.

Daniel Sykes: Okay, great. Thank you.

Speaker #3: Thanks.

Stephen Mikkelsen: Thanks.

Speaker #2: Thank you. Your next question comes from Ramon Zah from Jefferies. Please go ahead.

Operator: Thank you. Your next question comes from Ramoun Lazar from Jefferies. Please go ahead.

Speaker #6: Hi Stephen. Hi team. Just a couple of questions from me. Just with SAR, Stephen, you mentioned that, assuming non-ferrous prices stay where they are, that earnings base is sustainable into '27, I guess.

Ramoun Lazar: Hi, Stephen. Hi, team. Just a couple of questions from me. Just with SA Recycling, Stephen, you mentioned that, assuming non-ferrous prices stay where they are, that earnings base is sustainable into 2027, I guess. Just with all the investments SA Recycling has made over the last little while, are you able to give us a bridge on what volume uplift we should expect from those acquisitions? Or any sort of lead would be helpful to try to frame that into 2027.

Speaker #6: With all the investments SAR has made over the last little while, are you able to give us a bridge on what sort of volume uplift we should expect from those acquisitions? Any sort of lead would be helpful to try to frame that into 2027.

Stephen Mikkelsen: The volume uplift won't be huge, Ramoun. It's not about volume. I think it's about shoring up their market position. So making sure that they preserve what they've got, and they are preserving their margins. I wouldn't be assuming a huge volume uplift relative to the size of SA Recycling, which it's got huge volumes now. Do not assume a material volume uplift. It's really around shoring up their market position. That's probably the best way to say it.

Speaker #3: The volume uplift might be huge, Rowan. It's not about volume; I think it's about shoring up their market position, so making sure that they preserve what they've got and they're preserving their margins.

Speaker #3: So I wouldn't be assuming I wouldn't be assuming a huge volume uplift. Relative to the size of relative to the size of SA recycling, which is a it's got huge volumes now.

Speaker #3: Don't assume a significant, don't assume a material volume uplift. It's really around shoring up their market position. That's probably the best way to say it.

Speaker #6: Okay, great. And on SLS, it sounds like the second half of ’26 was a bit of an anomaly, in terms of customers just trying to look to monetize the high DDR4 prices.

Ramoun Lazar: Okay, great. On SLS, it sounds like the H2 2026 was a bit of an anomaly in terms of customers just trying to look to monetize the high DDR4 prices. Am I wrong in thinking that using H2 as any kind of baseline for SLS is probably the wrong approach to forecasting this business going forward?

Speaker #6: Am I wrong in thinking that using the second half as any kind of baseline for SLS is probably the wrong approach to forecasting this business going forward?

Stephen Mikkelsen: I think over the medium term, FY26 is perfectly fine. I do not think the H2 of FY26 was an anomaly. I think the anomaly is what's happening right now is the absolute crunch that's happening with everybody wanting to build data centers, everybody looking for electrical connections, everybody looking for land. I think that's the anomaly that's hit everybody. The reason why I am comfortable in saying that is there is a hell of a lot more DDR4 sitting out in the data center land than what's been repurposed to date. I guess my argument here, Ramoun, would be six months, I think six months is a blink of an eye relative to this market, is how quickly it changes. Once those bottlenecks are opened up, which they'll have to be, the material will flow just as strongly, probably more strongly, than the H2 of FY26.

Stephen Mikkelsen: I think over the medium term, FY 2026 is perfectly fine. I do not think the H2 of FY 2026 was an anomaly. I think the anomaly is what's happening right now is the absolute crunch that's happening with everybody wanting to build data centers, everybody looking for electrical connections, everybody looking for land. I think that's the anomaly that's hit everybody. The reason why I am comfortable in saying that is there is a hell of a lot more DDR4 sitting out in the data center land than what's been repurposed to date. I guess my argument here, Ramoun, would be six months, I think six months is a blink of an eye relative to this market, is how quickly it changes. Once those bottlenecks are opened up, which they'll have to be, the material will flow just as strongly, probably more strongly, than the H2 of FY 2026.

Speaker #3: I think over the medium term, if by '26 is perfectly fine, I don't think—if it's something, the second half of '26 was an anomaly, I think the anomaly is what's happening right now: the absolute crunch that's happening with everybody wanting to build data centers.

Speaker #3: Everybody's looking for electrical connections. Everybody's looking for land. I think that's the anomaly that's hitting everybody. The reason why I'm comfortable in saying that is there is a hell of a lot more DDR4s sitting out in data center land than what's been repurposed to date.

Speaker #3: So I guess what my argument here, Ramon, would be, six months—I think six months is a blink of an eye relative to this market and how quickly it changes.

Speaker #3: Once those bottlenecks are opened up, which they'll have to be, the material will flow just as strongly, if not more strongly, in the second half of '26.

Speaker #3: Because there's just simply more out there.

Stephen Mikkelsen: Because there is just simply more out there.

Speaker #6: Yeah, yeah, yeah. No, take your point. Do you have—I mean, how much visibility does SLS or Sims have with regard to that, Stephen?

Ramoun Lazar: Yeah. No, take your point. How much visibility does SLS or Sims have with regard to that, Stephen? Can you see into the June H2 of next year yet? Or is that just based on the scheduled timelines of your customers or not yet?

Speaker #6: Can you see into the June half of next year yet, or is that just based on the scheduled timelines of your customers, or not yet?

Stephen Mikkelsen: No, we have a pretty good line of sight for the H1, which is what. We have to have a reasonable basis before we can put things out. So we have a reasonable line of sight for the H1. There are some initial forecasts come from our customers for the H2, but they come heavily caveated, so no. It will not be until we get into the H2 that they really firm up when the material is actually going to come out in that period.

Speaker #3: No, we have a pretty good line of sight for the first half, which is what we've got to have—a reasonable basis before we can put things out.

Speaker #3: So we have a reasonable line of sight for the first half. There are some initial forecasts coming from our customers for the second half, but they come heavily caveated.

Speaker #3: So, no, it won't be until we get into the second half that they really firm up when the material is actually going to come out in that period.

Speaker #6: Okay. And there's no sort of lead you can provide us in terms of an assumed seasonality in that business this year?

Ramoun Lazar: Okay. There is no sort of lead you can provide us in terms of an assumed seasonality in that business this year?

Speaker #3: No, no, no. The seasonality—if it'll be commissioning seasonality—which is, it's just entirely based on when they get hold of electrical connections, when they get hold of land, when the construction happens.

Stephen Mikkelsen: No. The recommissioning seasonality, it is just entirely based on when they get hold of electrical connections, when they get hold of land, when the construction happens. If they have got a data center they are refreshing, obviously, if they are refreshing it with DDR5s and HBM, and high-power GPUs, it is going to need more electricity, so they are getting the electrical connection sorted out. Once that is sorted, then bang, all the DDR4s that are sitting in there will come out ready for the new DDR5s and HBM and GPUs to go in. So that does not have a seasonality to it. That just has when is the electrical connection approved and put in place. Those are what causes the variability between reporting periods.

Speaker #3: If they've got a data center they're refreshing—obviously, if they're refreshing it with DDR5s, HBM, and high-power GPUs—it's going to need more electricity.

Speaker #3: So they're getting the electrical connections sorted out. Once that's sorted, then, bang, all the DDR4s that are sitting in there will come out, ready for the new DDR5s and HBM and GPUs to go in.

Speaker #3: So that doesn’t have any seasonality to it. That’s just when the electrical connection is approved and put in place. Those are what cause these variabilities between reporting periods.

Speaker #6: Got it. Okay. And just one final one. On our end there, do you think that division's now stabilized in terms of the step-down, given what's going on with Chinese steel exports being partly offset by some of the additions like Glenbrook?

Ramoun Lazar: Got it. Okay. Just one final one on ANZ. Do you think that division is now stabilized in terms of the step down, given what is going on with Chinese steel exports being partly offset by some of the additions like Glenbrook?

Speaker #3: Yeah, I do. I do, on the assumption that non-ferrous stays where it is, and we're comfortable in that. But it's—I mean, I'd hope these are not famous last words—but it's hard to see the ferrous market getting much worse, given the impact that China is having on it.

Stephen Mikkelsen: Yeah, I do. On the assumption that non-ferrous stays where it is, and we are confident of that. I hope these are not famous last words, but it is hard to see the ferrous market getting much worse from the impact that China is having on it. So yes, in that sense, I feel that this is the bottom earnings for ANZ.

Speaker #3: So yes, in that sense, I feel that this is the bottom earnings for ANZ.

Speaker #6: Okay, well, I'll leave it there. Thank you.

Ramoun Lazar: Well, I will leave it there. Thank you.

Speaker #3: Thanks. Thanks.

Stephen Mikkelsen: Thanks.

Operator: Thank you. There are no further questions at this time. I will now hand back to Stephen Mikkelsen for any closing remarks.

Speaker #2: Thank you. There are no further questions at this time. I'll now hand back to Stephen Mikkelsen for any closing remarks.

Speaker #3: Okay, well, thanks, everybody, for the questions. Some very good questions there. We will see you—see all of you—over the next couple of days.

Stephen Mikkelsen: Well, thanks everybody for the questions. Some very good questions there. We will see all of you over the next couple of days, and I look forward to catching up. Thanks very much for dialing in.

Speaker #3: And I look forward to catching up. Thanks very much for dialing in.

Operator: That does conclude our conference for today. Thank you for participating. You may now disconnect.

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Q4 2026 Sims Ltd Earnings Call

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