10 Questions for Sheffield Green

1. What is Sheffield Green’s business about, and could you describe the Group’s key business segments?

• Headquartered in Singapore, Sheffield Green is a human resource (HR) services provider for the renewable energy industry. Aside from Singapore, the Group has subsidiaries in Japan, Poland, and a branch office in Taiwan and South Korea. Sheffield Green specialises in supporting EPCI (Engineering, Procurement, Construction and Installation) works within the renewable energy industry, including onshore and offshore wind, solar and green hydrogen.
• Our HR solutions are segmented into: 
• Provision of HR services: To supply a wide range of personnel per clients’ requirements ranging from management personnel (including C-suites) to technical personnel and offshore crew personnel across industry sub-segments. 
• Ancillary Services: Providing end-to-end ancillary services including visa and work permit applications, training and deployment logistics. A new initiative is the recent establishment of a training centre in Taiwan to develop and train specialised workers for the renewable energy industry. 
   

2. What are the market opportunities for Sheffield Green?

• According to the Global Wind Energy Council, wind energy is projected to furnish one-fifth of the world’s electricity by 2030, and Precedence Research forecasts the offshore wind energy sector’s expansion from US$33 billion in 2023 to over US$179 billion by 2032. According to IRENA, this is likely to lead to a substantial expansion in the renewable energy industry, with job opportunities slated to increase from 13.7 million in 2022 to 38.2 million by 2030. We believe that we are well-positioned to capture this growth in the renewable energy industry through our comprehensive range of HR services. 
• Furthermore, Sheffield Green is poised to broaden our services by exploring potential mergers and acquisitions, alongside strategic partnership opportunities with third-party service providers. This expansive range of offerings positions the Group as a one-stop solution for all renewable energy manpower needs. 
   

3. Describe the current market dynamics of the renewable energy industry. How is Sheffield Green positioned in this industry?

• Given macro uncertainties and rising costs, some offshore wind projects have turned financially non-feasible. However, Sheffield Green believes that tenders within the industry remain robust.
• Poland is seeing a healthy level of offshore wind activity given favourable trends in this industry. We have established our Poland office in November 2023, and have onboarded two new clients in 1H2024. With a Poland-based operational manager in place, we look to further grow our business and onboard new clients. We also have a Business Development Manager stationed in Poland. Additionally, our Operations Director, Engel, rejoined the Group earlier this year to bolster the team in Poland. We anticipate a similar demand for skilled blue-collar workers in Poland as we are currently seeing in Taiwan.
• Taiwan has a target to generate 20% of the country’s electricity using renewable energy, with a focus on offshore wind. The total investment in this sector is projected to reach ~US$33 billion and is expected to generate roughly 20,000 new jobs. We have established a training centre in Chiayi County, Taiwan to train a skilled workforce to meet client demands and industry standards. 
• South Korea aims to achieve 14.3 gigawatts (GW) of offshore wind capacity by 2030, driven by investments and strategic international partnerships. To capitalise on these trends, we have recently established an office in Seoul and hired a business development manager to spearhead our operations and grow the business. 
   

4. Why focus on this segment – Engineering, Procurement, Construction and Installation (EPCI) works in the renewable energy industry? 

• The HR requirements of this industry are very niche, requiring specialised knowledge and expertise to be able to fulfil staffing requirements, especially for EPCI needs. Given the relatively new secular growth in renewable energy HR needs, we believe that we are well-equipped with our HR offerings to capitalise on this specialised demand.   
   

5. Tell us more about the training centre being set up in Taiwan and how it fits into Sheffield Green’s strategy. 

• The training centre was a new strategic initiative launched in 2024, designed to address the increasing need for skilled personnel in the burgeoning offshore wind sector. Three highly qualified Taiwanese instructors will be leading training programmes to craft a workforce, recognised and valued by clients, and ready to meet the immediate and complex needs of the offshore wind market. 
• We believe that this is a win-win initiative that allows the Group to diversify our revenue streams by adding an education angle to our portfolio, while also ensuring that client requirements for well-trained personnel are met. We are considering expanding the number of training centres in Taiwan and in other operating regions, such as Poland.     
   

6. Could you update us on the progress of Sheffield Green’s operations and activities in the various geographies? 

• We are pleased to announce that our geographical expansion progress is on track, with the set-up of our office in Boston, USA on target in 2H24. The US has a strong outlook for its offshore wind sector and remains a target market for us. The recently approved Sunrise Wind offshore wind project in the US aims to power 320,000 homes and support 800 jobs.
• Our new office in Seoul, South Korea, is expected to attract new clients and expand our presence in the region over the next few months. Our new Business Development Manager, who recently joined the Seoul office, will also oversee the Japanese market with the support of our local country advisor in Tokyo. As a result, we anticipate an increase in business activities from this region over the next year.
   

7. What are some of Sheffield Green’s competitive advantages that set it apart from its peers? 

• Sheffield Green provides HR services specific to the renewable energy industry. We have a seasoned recruitment team with the ability to source and procure a diverse array of specialised talent, to fulfil the manpower demands of renewable energy projects.
• Our niche expertise is highly valued by the industry as shown by our work with our clients. From a single client in Taiwan in 2018, Sheffield Green has strategically positioned itself as the go-to partner for major players in the region. This rapid expansion exemplifies our scalable model and ability to extend our offerings globally.
• Furthermore, our work has led to long-standing and valuable client relationships, underscoring our commitment to excellent service and customer satisfaction. Examples of esteemed clients include Boskalis, CSBC Corporation Taiwan, and Volstad Maritime. This is a strong indicator of Sheffield Green’s reliability, performance, and the consistent value we deliver to clients. 
   

8. Could you share some of the key ESG factors that are material to your company and how that can create long-term value for your shareholders? 

• ESG is a key concern for Sheffield Green. Two factors that are material to us are People and Carbon Footprint Management.
• At Sheffield Green, People is a core component of our business, given we provide HR services. As such, we place a huge importance on the welfare of our employees. This includes economic advancement, workplace safety, as well as fair and pleasant working conditions, etc.
• As an operator within the renewable energy industry, it is also critical for us to manage our carbon footprint. Hence, we strive to ensure our carbon footprint is measured and reported according to relevant regulatory standards. We have also committed to lowering our carbon footprint by replacing our existing energy source with low or zero-carbon sources as we transition to become a low-carbon organisation. 
   

9. What are the mid- to long-term catalysts for Sheffield Green?  

• We are focused on expanding our presence in Taiwan, Poland and South Korea, which include onboarding new clients and securing more contracts. Our first training centre in Taiwan is a significant milestone for us, and will set the precedence for more centres in the future. Poland has enjoyed positive momentum with the signing of new contracts in 1H24, and we believe that this region will see further momentum. South Korea is another exciting region for us, and we expect positive momentum in the form of new clients and contracts. 
• The opening of our Boston office remains on track in 2H24, and we will provide updates accordingly. Although Japan has a promising outlook over the next 2-3 years, it remains a challenging market due to cultural differences. However, the Group remains committed to building its presence in Japan.
   

10. What is Sheffield Green’s value proposition for its shareholders and potential investors? What do you think investors have overlooked? 

• Management believes that Sheffield Green is a pick-and-shovel play for investors seeking exposure to the burgeoning renewable energy industry. As a provider of HR-related and ancillary services specifically catering to the renewable energy industry, the Group has an asset-light business model with profit before tax margin reaching 17% for FY23, highlighting substantial profitability.
• With a net cash (less lease liabilities and borrowings) position of US$7.3 million as at 31 December 2023, management believes that Sheffield Green represents an opportunity for investors seeking exposure to the renewable energy industry.

10 in 10 – 10 Questions in 10 Minutes with SGX-listed companies

Designed to be a short read, 10 in 10 provides insights into SGX-listed companies through a series of 10 Q&As with management. Through these Q&As, management will discuss current business objectives, key revenue drivers as well as the industry landscape. Expect to find wide-ranging topics that go beyond usual company financials.

This report contains factual commentary from the company’s management and is based on publicly announced information from the company.

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For more company information, visit www.sheffieldgreen.com

Click here for Sheffield Green’s 1H24 results.