Nestlé has written off the Russian business that Vladimir Putin seized last month, booking a 1.6 billion Swiss franc hit in its third-quarter report — even as the food giant's sales growth came in ahead of expectations.
Reporting from London on Thursday, Reuters said Nestlé's third-quarter organic sales grew 4%, beating the 3.4% analysts had expected, and the company maintained its full-year outlook of 3 to 4% growth. Real internal growth of 2.8% also topped the 1.5% expected, and Nestlé's shares were seen opening 1.3% higher.
The same report confirmed the price of Moscow's move. After Putin ordered the temporary seizure of Nestlé's Russian assets on September 17 — part of a crackdown on European companies over Europe's support for Ukraine — the business was removed from the group's consolidated accounts at the end of September. Nestlé is now derecognising assets in Russia worth 1.6 billion Swiss francs, and recognising a non-cash charge of around 1.4 billion francs for cumulative currency translation adjustments.
Chief Financial Officer Anna Manz told reporters the Russian business had contributed around 2% of group sales. Taking it off the books will not affect organic sales, volumes or pricing, she said, but derecognising the net assets will increase the group's net debt by approximately 900 million Swiss francs — about $1.09 billion — in 2026.
"I am pleased with our progress. But I am not satisfied. There is much more for us to do to deliver the potential of the business." — Philipp Navratil
Nestlé's position, stated when the seizure was ordered in September, is that it is "committed to taking all necessary steps to protect its rights and ensure continuity of business operations in the interests of all stakeholders, particularly its employees," and that it was assessing its options for a business with six factories and some 7,000 employees in Russia. The Kremlin framed the seizures — which hit French retailer Auchan in the same decree — as targeting European companies from "unfriendly countries." Kremlin spokesman Dmitry Peskov said in September that the companies concerned were "currently involved in the most active manner in military actions against our country." The seized assets were placed under the temporary control of LEV Management.
The write-off closes the accounting chapter on a business Nestlé no longer controls, while the operating business moves on without it. Chief Executive Philipp Navratil, who took the job in September 2025, used the results to press his overhaul of the company — pleased with the progress, by his own words, but "not satisfied."