Business management consultant SSH Group (ASX: SSH) has bagged major wins within its recruitment and workforce management division, boasting an addressable market of over $23.7 billion. The Company has secured new and renewed contracts in both the construction and government sectors, totaling over $5 million.
Within construction, SSH Group Safety, a subsidiary within its Recruitment & Workforce Management Division, has won two contracts for security, patrol, and access control services. These contracts have been granted by Multiplex, a prominent construction company, for its projects at ECU City in Perth’s CBD and the new development at Elizabeth Quay Lot 6 – 9 The Esplanade Project. The total estimated value of these engagements is approximately $3.8 to $4 million, with completion expected in late 2025. Furthermore, SSH’s subsidiary, ‘Bridge Resources’, has been approved to provide Labour Hire services to Multiplex across its construction projects.
In the government sector, SSH Group Safety has extended its partnership with the City of Cockburn, a local government authority, to provide community patrols, CCTV monitoring officers, and Asset Protection services. The contract extension is estimated at approximately $1.2 million and is set to continue until June 2024.
Chief Operating Officer, and Executive Director of SSH Group, Stefan Finney, stated, “We are exceptionally pleased to have secured these opportunities for our recruitment and workforce management division. These contract wins and renewals with long-standing clients underscore our commitment to serving our clients and nurturing enduring relationships to meet their needs. Building and maintaining customer relationships is core to the success of the SSH Group’s ethos and service delivery.”
In FY23, SSH Group reported that its revenue declined by $55 million compared to FY22, amounting to $41.1 million, as some contracts came to their natural end and it got fewer large-scale contracts. At the same time, its EBITDA showed positive growth, rising from a loss of $0.7 million to a profit of $3.3 million. As of the end of the fiscal year, the Company held $2 million in cash.
Plus, SSH Group has undergone some board changes, including the appointment of a new company secretary, Sonu Cheema, and interim CFO, Anna Lane.
Listed in 2021, SSH provides various services related to workforce management, recruitment, and consulting, working with high-growth companies in the mining and construction segments.
In FY23, the Company completed the integration of KMH (Machinery Hire Division), the organic startup of Tru Fleet (Fleet Hire Division), the rebranding and launch of Bridge Resources (Recruitment and Workforce Management Division), and a values-aligned partnership with Aboriginal investment company Four Hills Group to establish the Four Hills Services partnership.
Tru Fleet was launched as an internal SSH Group business startup last year, expanding the Company’s fleet assets to Western Australia, New South Wales, and Queensland. In just one year since its inception, Tru Fleet achieved an impressive EBITDA that provides a 121% return on capital.
However, SSH incurred significant one-off expenses in FY23 related to restructuring its cost base in response to the reduction of large workforce contracts affecting revenue.
The Company’s strategic goals for the coming years include achieving organic growth, increased asset utilisation, geographical expansion, and broadening its service offerings.
For the next three to four years, SSH Group is targeting an EBITDA margin of 15%, hopefully marking a lasting departure from its FY22 losses.
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