Festi: Financial results for Q1 2026

Festi’s operations in line with expectations – Q1 profit amounted to ISK 218 million

Main results in Q1 2026

• Sales of goods amounted to ISK 40,061 million, an increase of 6.0% YoY.
• Margin from sales of goods and services amounted to ISK 9,747 million, an increase of 5.8% YoY.
• Gross margin was 24.3%, decreasing by 0.1 p.p. from Q1 2025, but by 0.6 p.p. excluding the effects of exchange rates, changes in global fuel markets and changes in public levies on fuel at the turn of the year.
• EBITDA amounted to ISK 2,565 million, increasing by 3.0% YoY.
• Profit amounted to ISK 218 million and return on equity was 13.7%.
• Net cash from operating activities was negative by ISK 32 million, with one-off effects in operating-related assets and liabilities explaining the YoY difference.
• Interest-bearing debt was refinanced during the quarter for approximately ISK 4.2 billion, in addition to ISK 297 million being repaid on other loans. Share buy-backs amounted to ISK 563 million.
• Equity amounted to ISK 44,971 million, and the equity ratio was 38.7% at the end of Q1 2026, compared to 41.2% at year-end 2025. The company distributed dividends of ISK 2,151 million in March, which were paid to shareholders on 9 April.
• The company’s EBITDA guidance for 2026 remains unchanged at ISK 16,500–17,000 million.

Ásta S. Fjeldsted, CEO:

“Operations performed well during the quarter and were in line with management’s expectations. Total revenues increased by 6.0% YoY, while sales volumes increased across most product categories; the number of transactions increased by 1.4%, the number of items sold increased by 5.8%, and the number of fuel litres sold increased by 18.5%, primarily driven by sales to high-volume customers. Transaction growth through digital channels remains strong, with the number of transactions increasing by 13.3% YoY.

As elsewhere in the economy, wage costs and input prices have increased, but targeted measures have largely offset these effects. Salaries and employee-related expenses increased by 3.5% overall, excluding the effects of changes in full-time equivalents. Our focus is on maintaining competitiveness while ensuring sustainable operations over the longer term.

Investments in digital solutions and data-driven decision-making continue to deliver increased efficiency. The use of artificial intelligence and automation in key areas of the operations has already had a positive impact, although there remain many opportunities for further development.

Profit for the first quarter amounted to ISK 218 million, a decrease of ISK 61 million YoY. The equity ratio was 38.7% at the end of the quarter, a decrease of 3.5% from year-end 2025, while dividends paid to shareholders on 9 April amounted to ISK 2.2 billion. The company’s liquidity position is good and its balance sheet remains strong,” says Ásta S. Fjeldsted, CEO of Festi.

Main news from the company’s operations

• Krónan continues to attract new customers while upgrading its stores. Krónan in Lindir, Kópavogur, will reopen in early summer and will be one of the most impressive grocery stores in the country.
• Lyfja announced the acquisition of Borgar Apótek in Borgartún, subject to approval by the Icelandic Competition Authority. At the same time, construction has begunon Lyfja’s new pharmacy in Vellir, Hafnarfjörður, next to Krónan.
• ELKO Smart Payments (Snjallgreiðslur) have been very well received in the online store, and the service is planned to be rolled out in stores this autumn. ELKO will open a new store in Smáralind in the coming weeks, in a prime location next to the new food hall Garðurinn, offering a specially selected range of products and services.
• N1 is gaining momentum, despite a decline in margin during the quarter. The number of transactions increased by 16% YoY and the number of new fuel customers doubled. N1‘s app continues to attract more customers, with March being a record month for litres sold through the app. Tyre workshops are fully booked with cars switching to summer tyres, with the season starting considerably later than last year. Developments in Akranes, a transformation of the service station in Blönduós and several other projects are in full swing.
• Bakkinn’s new refrigerated warehouse commenced operations during the quarter and will further support growth and improved quality of fruit and vegetables at Krónan.
• Festi completed the sale of a new inflation-linked bond series with a nominal value of ISK 4.2 billion at a yield of 3.95%. This is the company’s first bond issue and represents the refinancing of part of the company’s debt.

“The outlook for 2026 is good, despite uncertainty in economic developments, rising inflation forecasts and ongoing tensions in the Middle East. The closure of the Strait of Hormuz has had wide-ranging effects on global market prices for oil and other inputs based on fossil fuels. The effects on tourism and other domestic industries remain unclear, but the summer months ahead are typically the busiest period in the Group’s operations. We will continue to seek ways to counter increases in product prices – and thereby inflation – through improved operations and lower unit prices.

Our priorities this year remain strong operational performance across our companies and investment in their future. We continue to be guided by our purpose of improving everyday life and creating value in harmony with society,” says Ásta S. Fjeldsted.

Attachments

• Festi hf - Company announcement Q1 2026
• Festi hf - Consolidated Statements for 2026 Q1 - signed