Highlights:

EBITDA of AUD254.1 million up 3% on HY08;

EBIT of AUD172.3 million before non-cash goodwill impairment charge down 17% on

HY08;

Net income of AUD93.6 million before non-cash goodwill impairment charge of AUD173.0 million;

Earnings per share of 51.8 cents before non-cash goodwill impairment charge;

Non-cash goodwill impairment charge of AUD173.0 million;

Net debt of AUD54 million, less than 2% of total capital, attributable to strong cash flow from operations of AUD541 million.

Financial Results for the half year ended 31 December 2008:

EBITDA (earnings before interest, tax, depreciation and amortization and goodwill impairment charge) of AUD254.1 million was up 3% on the prior corresponding period.

The net loss after tax was in line with the company’s most recent guidance, after taking into account the non-cash impairment charge related to goodwill, outlined below. Additionally, the half-year results reflect the impact of write-downs to the net realizable value of inventories of AUD116 million, as well as the impact of non-ferrous contract renegotiations that reduced operating income by AUD42 million, giving total adjustments of AUD158 million (pre-tax). Scrap intake across the Group declined sequentially by 42%, from 4.153 million tonnes in the first quarter to 2.395 million tonnes in the second quarter.

The company also announced that, consistent with transition plans put in place on completion of the Metal Management merger, group chief executive officer Daniel W. Dienst is now responsible for all of the company’s global operations. Jeremy L. Sutcliffe continues in his role as an executive director.

Dienst stated, “As our results reflect, we experienced an unprecedented deterioration in economic conditions in the first half of our 2009 fiscal year. The downturn spread with remarkable speed, ultimately affecting demand and metal prices in a way that could not have been foreseen. As a consequence of the global credit crisis and rapid deleveraging, and the related effects on commodity markets, we recorded a number of significant abnormal items.”

Dienst continued, “Despite these factors, we are encouraged by the strong cash flow generated by the company, which resulted in modest net debt at the end of our first half and a gearing ratio of less than two%. We believe that with our dedicated employees, global reach, and leading position in markets around the world, Sims Metal Management will emerge from this downturn even stronger and will create meaningful long-term value for its shareholders.”

Non-Cash Goodwill Impairment Charge:

Due to the current economic environment, changes to the company’s operating results and forecasts, and a significant reduction in the company’s market capitalization, the company was required to perform a goodwill impairment test in accordance with Australian Accounting Standards Board (AASB) 136 – Impairment of Assets. AASB 136 requires management to determine the value of the company’s cash generating units. Management assessed the recoverable amount on a value-in-use basis, utilizing discounted cash flows. As a consequence of the impairment review, the company recorded a AUD173 million (pre-tax and after-tax) non-cash charge to write-down the carrying value of goodwill in North America.

North America:

Sales revenue was up 208.8% on the prior corresponding period to AUD4.23 billion. On a US dollar equivalent basis, sales revenue was up 177.1% on the prior corresponding period to AUD3.31 billion. EBIT (earnings before interest and tax) was down 88% to AUD13.5 million.

Half year results for North America were impacted by inventory adjustments and the impact from non-ferrous contract renegotiations of AUD69 million and AUD22 million, respectively, as well as a goodwill impairment charge of AUD173 million (pre-tax and after-tax). EBIT in North America was AUD277.5 million before inventory adjustments, non-ferrous contract renegotiations, and goodwill impairment.

Dienst said, “The most significant accomplishments of the half year were the completion of the integration of Sims and Metal Management in North America and the repositioning of all businesses globally. We’re proud of the progress we’ve already made and will look to leverage best practices across the region to deliver improved operating results in the months ahead. Cost reduction synergies due to the merger integration are being accomplished at higher than the previously projected rate of AUD35 million per year and are being supplemented by significant commercial benefits.”

Dienst continued, “Our scrap intake in North America declined about 43% from the first quarter to the second quarter. In light of this unprecedented decline, we have aligned our resources appropriately, carefully managed buy prices and inventories, and slashed operating expenses, which included a painful reduction in staffing in the region by about 18%.”

Australasia:

Sales revenue for the region was down 15.3% on the prior corresponding period to AUD683.7 million. EBIT was down 60.6% to AUD27.3 million.

Half year results in Australasia were impacted by AUD7 million of inventory adjustments and AUD10 million of non-ferrous contract renegotiations as well as a decline in joint venture income. EBIT, before inventory adjustments and non-ferrous contract renegotiations, was AUD44.3 million.

Dienst said, “Our Australasian operations have a legacy of market leadership and excellence in metals recycling – in good or in challenging markets. We carefully managed costs and prices to defend our margins and to help offset the 43% decline in scrap intake in Australasia from the first quarter to the second quarter.”

Europe:

Sales revenue was up 20.4% on the prior corresponding period to AUD660.9 million. EBIT was a loss of AUD41.5 million.

Half year results in Europe were impacted significantly by AUD40 million of inventory adjustments and AUD10 million of non-ferrous contract renegotiations. EBIT before inventory adjustments and non-ferrous contract renegotiations was AUD8.5 million.

Dienst said, “We have a strong presence in Europe, with a leading position in metals recycling in the U.K. and a significant electronics recycling business. We are confident that Europe will be a steady contributor to our success in the years ahead and we appreciate the continued focus of our talented employees in this region as we expand in both the metal and electronic recycling marketplaces. Scrap intake in Europe declined by 33% from the first quarter to the second quarter. We recently expanded and enhanced our U.K. metal recycling footprint by acquiring All Metal Recovery Limited, in the West Midlands, and by commissioning the largest and most advanced e-recycling plant in the world in Newport, South Wales.”

Sims Recycling Solutions:

Sims Recycling Solutions (SRS) was not immune to the difficult market conditions around the world. The SRS business has evolved over time from a primarily fee-for-service platform to a merchant model increasingly reliant on commodity prices, similar to the scrap metal business. Consequently, as commodity prices declined, profitability in SRS was challenged and inventory adjustments were required. As a result of difficult markets and inventory adjustments, SRS businesses across all regions also experienced losses of AUD12.6 million as compared to EBIT of AUD43.1 million in the prior corresponding period.