LONDON Sims Metal
Management Ltd. is recording a write-down of Australian $78
million ($80.5 million) on its British inventory, the company
said Feb. 15.
The global recycling company
formed a special committee last month to investigate inventory
valuation issues at the U.K. business (
amm.com, Jan. 22). The committee has concluded
that the total impairment charge will come to A$78 million, up
from a preliminary assessment of about A$60 million ($61.9
million), and Sims said the adjustment had been verified by
external auditor PricewaterhouseCoopers LLP.
Following the investigation, the
company now believes that it will have to restate its results
for fiscal 2010, 2011 and 2012 to account for A$62 million ($64
million) of the inventory writedown, while A$16 million ($16.5
million) will affect its results for the first half of fiscal
Sims also advised the market in
January that it had incurred impairment charges related to
goodwill and other intangible assets of A$354 million ($365.4
million) in aggregate. A total of A$291 million ($300.4
million) from the charge is related to North America Metals and
will be recorded against fiscal 2013 results, while A$63
million ($65 million) is linked to U.K. Metals and U.K. Sims
Recycling Solutions and will be shown in the restatement of
results for prior periods.
The company will be filing
amended documents with the U.S. Securities and Exchange
Commission as soon as possible, Sims added.
The announcement came in the
wake of Rio Tinto Plcs $14.4-billion writedown related to
its aluminum business (
amm.com, Feb. 14) and Barrick Gold Corp.s
$3.8-billion writedown related to its copper division (
amm.com, Feb. 14).
A version of this article was first published by AMM sister
publication Metal Bulletin.