Citi analysts have scaled back their earnings before interest and tax (EBIT) estimates for the fiscal year 2023 (FY23) for Sims, one of Australia’s known firms in the ferrous and non-ferrous metals sector.

The FY23 EBIT estimate for Sims (ASX:SGM) has been reduced by 2%, now predicted at A$258 million.

This figure is compared to the Visible Alpha consensus of A$243 million.

The firm is expected to deliver a full-year distribution per security of A$0.34, slightly below the consensus estimate of A$0.35.

Citi anticipates the FY23 net profit after tax (NPAT) to be around A$175 million, a 2% decrease compared to fiscal year 2022.

It is also suggested that lower iron ore prices expected in the December quarter could pose a potential risk for the company.

Should China restrict steel production in 2023, the company’s second half production could be down 13% from the first half.

Of the 13 analysts, two rate the stock a ‘buy’, six rate it a ‘hold’ and five regard it as ‘sell’ or lower, with a median price target of A$15.70.

The stock had risen 14.1% this year as of the last close.

Sims is a leading firm in the ferrous and non-ferrous metals industry in Australia.