Hagar Posts Record Year, Vows Lower Prices with Salling Group Deal

REYKJAVÍK, ICELAND – April 16, 2026 – Icelandic retail giant Hagar hf. today announced a landmark end to its 2025/26 fiscal year, reporting robust financial results that surpassed management guidance and unveiling a strategic procurement partnership poised to significantly impact consumer prices across the nation. The company’s annual sales surged 9.3% to 197,043 million ISK, while EBITDA hit 18,129 million ISK, driven by strong performance across all sectors, including its grocery, fuel, and newly integrated Faroe Islands operations.

The most significant announcement, however, was the new alliance with Danish retail behemoth Salling Group. This partnership is designed to leverage Salling Group’s immense purchasing power to lower costs on hundreds of products in Hagar’s popular Bónus and Hagkaup stores, offering a direct challenge to Iceland's high cost of living.

A Strategic Alliance to Tackle Living Costs

The procurement partnership with Salling Group marks a pivotal moment for the Icelandic grocery market. In a country where food costs are notoriously 30-50% higher than in mainland Europe, the move is a direct attempt to ease the financial burden on consumers. Salling Group, which operates over 2,100 stores across Northern Europe, brings formidable collective buying power that Hagar will now leverage.

“In this context, we are pleased to announce that we have started a new procurement partnership with the Danish retail group Salling Group,” stated CEO Finnur Oddsson in the company’s announcement. “We expect these price reductions in our stores to have a positive impact on the development of grocery prices in general and contribute to easing inflationary pressures.”

The first products under this new partnership are already appearing on shelves. This initiative intensifies competition in a dynamic market where Hagar’s low-price leader, Bónus, contends with rivals like Krónan and the aggressively priced newcomer, Prís. By introducing Salling’s competitively priced goods, Hagar is not only enhancing its value proposition but also setting a new price benchmark that competitors will be forced to address.

Robust Financials Underpin Ambitious Strategy

Hagar's bold strategic moves are backed by a year of exceptional financial health. The company exceeded its own EBITDA guidance of 17,600-18,100 million ISK, a testament to operational strength. This performance was not a late-year surge but the result of consistent growth, with sales and earnings showing strong year-over-year increases in each quarter.

“The quarter concludes a strong financial year for Hagar, with the company’s new operating pillar, SMS in the Faroe Islands, now fully contributing,” said Oddsson. He noted that while reported Q4 profit of 1,981 million ISK was down from the prior year, the comparison was skewed by one-off income items in the previous period. “Adjusted for one-off income items and changes in the valuation of investment properties in the prior year, EBITDA strengthened further year-on-year and operating profit increased,” he clarified.

The full integration of the SMS shopping center in the Faroe Islands, acquired in early 2025, has proven to be a resounding success, establishing a new and profitable operational pillar for the group. Even the abolition of fuel duties, which impacted revenue figures at the Olís fuel division, did not derail the company’s momentum, with like-for-like sales growth estimated at a healthy 6.4%.

Digital Transformation Drives Future Growth

Beyond traditional retail, Hagar is aggressively investing in a digital future, with two key initiatives already demonstrating significant potential. The company's new loyalty program, “Takk,” launched in mid-January, has been an unqualified success. It attracted nearly 60,000 members in its first few months, a figure that far exceeded internal projections. Powered by modern, frictionless technology from PassEntry, the program integrates directly into users' Apple and Google Wallets, allowing for seamless reward collection and redemption at the point of sale.

“The program enables Hagar’s retail operations to better tailor product offerings and services to customer needs,” the company stated. This rich, first-party data is set to become a cornerstone of Hagar’s customer engagement strategy.

Building on this digital momentum, the company is preparing for the formal launch of “Hagar miðlar” (Hagar Media) on April 17. This new retail media unit will allow brand partners to communicate directly with shoppers at the point of sale, tapping into a booming advertising segment. With the Nordic retail media market projected to see double-digit annual growth, Hagar is positioning itself to capture a new, high-margin revenue stream that moves beyond the physical aisle.

Broad Strength Across All Segments

The company’s strong annual results reflect a healthy and diversified portfolio. Customer traffic at Bónus stores hit record levels, with revenue growing 9% in the fourth quarter. Hagkaup enjoyed a strong Christmas trading period, bolstered by its broad product offering and growing e-commerce sales. The fuel and services division, Olís, delivered one of the strongest years in its history, driven by efficiency improvements and growth in non-fuel sales like car washes and food service.

Meanwhile, the SMS operations in the Faroe Islands performed well above forecasts, with revenue increasing nearly 9% year-over-year in the final quarter. The successful opening of a new retail center in Runavík further cements Hagar’s strong position in that market.

Looking ahead, Hagar has issued confident guidance for the 2026/27 fiscal year, projecting EBITDA to be in the range of 18,800 – 19,300 million ISK. Oddsson concluded on a note of optimism, acknowledging economic headwinds but emphasizing the group's solid foundation. “Despite challenging conditions facing the Icelandic economy and global markets for oil and supplies, we remain confident in a positive outlook for Hagar. The Group’s position is strong, and there are multiple opportunities ahead for profitable growth.”