European Energy's Q3 EBITDA falls despite higher revenue

The Nojsomheds Odde wind farm in Denmark. Source: European Energy A/S

December 2 (Renewables Now) - Danish wind and solar developer European Energy A/S on Tuesday reported a net profit of EUR 6.7 million (USD 7.6m) for the third quarter of 2021, compared to EUR 2.2 million a year earlier.

Pre-tax profit tripled to EUR 9.6 million from EUR 3.2 million thanks to a gain following a green bond refinancing. Earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 41% to EUR 5.5 million due to a lower gross profit and higher costs. One of the factors impacting gross profit was EUR 4.4 million of impairment losses on project development.

Revenue increased 15% to EUR 46.8 million, with electricity sales jumping 49% to EUR 12.4 million thanks to additional operating parks and record-high power prices which more than offset low wind speeds. Sales of energy parks increased by 8% to EUR 33.4 million.

European Energy said it has not been unaffected by the widely observed supply chain delivery shortages and delays and the completion of some projects has shifted from the fourth quarter of 2021 into 2022, but the company is on track to meet its full-year outlook.

“The increasing demand for green power to various industries and growing interest from investors for our projects and power purchase agreements provides us with confidence that financial guidance for the full year will be reached,” said chief executive Knud Erik Andersen.

The 2021 outlook envisages an EBITDA of EUR 80 million and a profit before tax of EUR 50 million.

The company closed the quarter with 27 projects under construction across seven countries, representing 1.2 GW of capacity, almost 400% more than a year earlier.

Since the end of the third quarter, European Energy has executed its biggest sale to date, of three wind parks totalling 185.5 MW in Lithuania.

In the nine-month period, net profit climbed 15% to EUR 7.6 million, while revenue fell 20% to EUR 84.9 million, due to a decline in energy park sales.

(EUR 1 = USD 1.131)

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Plamena has been a UK-focused reporter for many years. As part of the Renewables Now team she is taking a keen interest in policy moves.

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