Festi hf.: Financial results for Q1 2025

Main results in Q1 2025

• Sales of goods and services amounted to ISK 37,786 million, an increase of 17.3% between years but 3.0% excluding the impact of Lyfja, which became part of the group from July 2024.
• Margin from sales of goods and services amounted to ISK 9,212 million, an increase of 31.0% from the previous year but 10.5% excluding the effect of Lyfja.
• Profit margin was 24.4%, up by 2.6 p.p. from Q1 2024 but decreasing by 0.1 p.p. from last quarter.
• Salaries and personnel costs amounted to ISK 5,305 million, an increase of 34.4% between years but 12.0% excluding the effect of Lyfja.
• EBITDA amounted to ISK 2,489 million, increasing by 31.2% between years but increasing by 13.1% excluding the effect of Lyfja.
• Profit for the quarter amounted to ISK 279 million, increasing by ISK 77 million between years.
• Equity amounted to ISK 42,421 million, and the equity ratio was 36.8% at the end of Q1 2025, compared to 37.9% at year-end 2024. A dividend of ISK 1,400 million was recognized as liability in March and paid to shareholders on 9^th of April.
• The company’s EBITDA guidance for the year 2025 is unchanged at ISK 14,400 – 14,800 million.

Ásta S. Fjeldsted, CEO:

• The company's operations in the first quarter of the year were good and in line with expectations. Sales of goods increased in most product categories, increasing by 17.3% between years (2.8% excluding Lyfja) and the number of sales increased by 10.2% (1.4% excluding Lyfja).
• Profit margins increased in all of the Group's product and service categories,  overall by 2.6 p.p. between years.  Margin from sale of goods and services amounted to ISK 9,212 million, an increase of 31.0% between years (10.5% excluding the effect of Lyfja).
• Operating expenses for the quarter increased by 28.9% year-on-year (8.3% excluding the effect of Lyfja) while the number of full-time equivalents increased by 281 year-on-year (249 for Lyfja).
• EBITDA for the quarter amounted to ISK 2,489 million, an increase of 31.2% between years and an increase of 13.1% excluding the impact of Lyfja.
• Profit for the quarter in 2024 amounted to ISK 279 million, an increase of 35.2% from the previous year, or by ISK 77 million. (23% without effect of Lyfja).
• The impact of tariff increases on imports to the United States, as well as countermeasures from other countries announced in April, have led to uncertainty and instability in global markets.  In management opionion, this will not have significant impact on the group's operations during the year. 
• The summer, is ahead which is the company‘s most important season of the year and the outlook is good.  The company's EBITDA forecast for the year 2025 is unchanged and amounts to ISK 14,400 – 14,800 million.

The highlights of the quarter and key months ahead:

• Krónan will open a new store at Fitjabraut 5 in Reykjanesbær this summer and at the same time a smaller store in Reykjanesbær will be closed. Krónan in Vallakór has undergone a complete overhaul and a new renovated store will open at the beginning of June.
• Yrkir bought Hvaleyrarbraut 3 in Hafnarfjörður in April, housing and a plot of land in a great location by the harbour, which houses one of Krónan stores, among other things.  The acquisition is part of the company's strategy of owning key locations for the future with the possibility of further development in line with the town‘s development plans.
• New fuel pumps will be opened at Fiskislóð on May 1st.  At the same time, fuel pumps will be closed on Ægissíða, which is a part of an agreement with the City of Reykjavík from 2021.
• The Lyfja app was chosen App of the Year in the quarter and also received an award for design and interface at the SVEF Awards of the Year.
• Advances in the B2B and B2C markets continue at ELKO, Krónan, Lyfja and N1.  There is a strong emphasis on digital experiences and new exciting solutions will be introduced later in the year.
• The first exercise period of the stock option scheme for Festi's employees is now in May, but at the Annual General Meeting on March 6, 2024, shareholders approved a proposal from the company's Board of Directors to establish a stock option scheme for all permanent employees of the group, where they were offered to purchase shares at a fixed price for up to ISK 500 thousand on three occasions over three years. 
• In accordance with the content of the stock option scheme, employees who have started working within the Group after the first allocation will be offered participation now in the system for the remaining duration of the scheme (2 years).

"Operations in the first quarter went according to plan. Operations are stable and growth is in line with expectations. The company's finances are strong and the minds of management and employees are aligned with the opportunities that lie in a strong group and the expansion of its services and product range.

The uncertainty created in the markets in April with policy changes and the announcement of tariff hikes by the new US president has had a considerable impact on global oil prices and the foreign exchange market, which fluctuates day by day. Whether  and then to what extent the impact of this will be on tourism or other industries in the country is unclear as of yet.  Ahead are important summer months and where we will now as always monitor closely and play well from the cards we have been dealt. With strong foundations, technical infrastructure and different business units that together form a whole range of essential goods and services throughout the country, the outlook is good for the year as a whole," says Ásta S. Fjeldsted, CEO of Festi.

Attachments

• Festi hf - Company announcement Q1 2025
• Festi hf - Consolidated Statements for 2025 Q1 - signed