Major investors from Asia are expressing interest in European Energy's assets, says CEO.
European Energy's assets are increasingly attracting more Asian investors, says Knud Erik Andersen, founder and CEO of the Danish developer and independent power producer in connection with the company's latest quarterly report.
Asian investors are no strangers to European Energy, given that Japan's Mitsubishi owns a fifth of the Danish company. What is new is that Asian investors are showing greater and greater interest in the company's projects.
"At the asset level, we haven't really had Asian investors to any great extent, but we are seeing that now," says Andersen, pointing more specifically to countries such as Japan and South Korea.
The newfound interest from Asia is partly due to the developer's increasing activities in the Australian market. New solar farms have been inaugurated in the market, while construction on several projects is underway.
More interest from Asia is not the only change that the CEO sees among potential investors in European Energy's assets.
Andersen also notes that the company is in dialogue with investors which are larger and more influential than before.
"And that fits very well, because we also have a larger and larger portfolio, where we need investors with deeper pockets," he says.
Why are you seeing this shift?
"It is happening as European Energy grows and we have become more visible, even beyond the European market. Furthermore, we have a relatively strong pipeline in Australia and some good cases that have attracted a lot of interest from there."
European Energy ended the last quarter with a loss of EUR 23.1m out of revenue totalling EUR 106.6m.
Additionally, guidance for the year's earnings before interest, taxes, depreciation and amortization (EBITDA) was downgraded.
Before the financial statements were published, the developer forecast EBITDA to be at the low end of the EUR 200-300m range.
The current forecast is that the result will land at EUR 200m with a margin of plus or minus 15%. However, Andersen is not immediately concerned that the result may fall short of the original expectations.
"We have never had as many sales transactions in progress as we do this year, and we have a lot of transactions running in parallel," he says.
When these transactions will be completed and can be recorded in the books depends on how the FDI approval processes proceed.
So whether European Energy will fall below or exceed EUR 200m depends largely on external factors, according to the CEO.
"There are many different external factors that we cannot control 100% of the time. If you take the volume of the transactions we have in, we will comfortably exceed EUR 200m - well above, in fact," says Andersen, continuing:
"It may well be that we exceed the target, or we may fall slightly short. The important thing is that we are actually quite comfortable with the market for our asset class."
At the same time, European Energy is suffering from a cross-sector challenge, where the supply of electricity exceeds demand.
The consequence is a lower electricity price, sometimes negative, which also contributes to dampening earnings. A solution to the challenge was launched earlier this year, when European Energy decided to connect batteries to all its energy parks.
The ambition is to install 1GWh in the Nordic region by 2027, and the work is expected to yield its first results in the current quarter.
Andersen estimates that the battery initiative will really take off in the second half of 2026.
"We are prioritizing this very highly, and we have a large pipeline. We have launched a number of projects in parallel in Denmark, the Baltic States, England, and Australia. Slowly but surely, we will see this new asset class [batteries] become a gain."