Mr. Dienst continued, "Despite very early signals of better times ahead, our North America Metals business continued to face headwinds in the first half of Fiscal 2013. Scrap intake and shipments were materially down from the prior corresponding period, as the business prudently applied selective buying behaviour and chose not to chase marginal intake tonnages. Notwithstanding the implementation of proactive source control; a challenging set of global economic conditions, weaker metals prices, tentative demand for the majority of the period, and the impact of adverse significant items, resulted in a statutory loss. We are not satisfied with this result and continue our efforts to streamline our North America Metals operations. Controllable costs after adjusting for significant items were reduced by $4.7 million per month from the prior corresponding period. This is in excess of management's previous forecast of $4 million per month. Through further reduction in controllable costs and the potential monetisation of a few residual non-core and underperforming assets, we have now increased our targeted cost savings to $6 million per month in the second half of Fiscal 2013, leading to a total annualised controllable cost reduction run rate of circa $70 million by the end of Fiscal 2013.
Mr. Dienst said, "During the first half of Fiscal 2013, we continued to optimise our North American asset portfolio. Within our SRS business we made two strategic acquisitions, one in British Columbia and the other in Maryland, expanding our network of locations across the continent. In Metals Recycling we divested non-core and underperforming assets in Arizona and Colorado, as well as our 50% interest in the Nashville joint venture. We recycled some of this capital into the acquisition of a business with a shredder around which we added feeder yards to support our Gulf region growth. Development of our expanded New England footprint with the third prong of our expansion there, a greenfield full service facility and shredder in Rhode Island to complement our recently opened deep sea dock and non-ferrous depot, is targeted to be complete in September 2013. These actions are a part of our clear strategy to direct capital to the highest returning assets, with an emphasis towards water based facilities in scrap rich regions where we can achieve a leadership position, source control, and solid ROI's through the cycle."
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