Sims (ASX:SGM) share price edges higher as new facility approved

Shares in the metal-recycling company are climbing today on the back of a key announcement. We take a closer look

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The Sims Ltd (ASX: SGM) share price is in the green today. This comes after the company announced it received development approval for its pilot resource renewal facility in Queensland.

At the time of writing, Sims shares are swapping hands for $16.05, up 1.39% from yesterday's close.

Let's take a look at what the metal-recycling company said in its release today.

Smiling worker in metal landfill.

Image source: Getty Images

New pilot resource facility

According to Sims' announcement, development approval has been granted from the Queensland Government and Brisbane City Council for its resource renewal facility in Rocklea.

The company expects its Rocklea facility to become operational in 2022. It will focus on research and development to "advance technology across the programme".

Sims managing director and chief executive Alistair Field said:

Sims Resource Renewal is about creating a truly closed loop in metals recycling and a genuinely circular business model.

The company also mentioned the notion of sustainability:

Producing hydrogen supports the transition to a more sustainable energy landscape, and it
enables Sims to advance its purpose to create a world without waste to preserve our planet.

Following a commercial demonstration in the United States, Sims also plans to produce hydrogen for industrial use. This would take place at its proposed facility in Campbellfield, Victoria.

The proposed facility in Melbourne's north west will use green energy to power operations, according to Sims.

Further, at this facility the company will continue its plans to produce recycled materials in critical infrastructure, such as in construction and roads.

Sims share price snapshot

This year to date, the Sims share price has gained 17%. Furthermore, it has gained 112% over the past 12 months.

The gains exhibited over this time outpace the S&P / ASX 200 Index (ASX: XJO)'s return of 9.3% and around 23% over these same periods.

Sims has a market capitalisation of $3.2 billion, and paid a 12 cents per share dividend in March.

The author has no positions in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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