Nestlé said a September decree placing its Russian business under temporary external administration led it to remove about CHF 1.6 billion in net assets from consolidation, with year-end net debt expected to rise CHF 0.9 billion.
The Swiss food group said the change began at September’s end. It no longer controls management of the Russian operations, but said it remains the legal owner of the assets, according to its “Third-quarter and nine-month 2026 sales” release.
Nestlé recorded a noncash charge of about CHF 1.4 billion for cumulative currency translation adjustments. The company said the charge would not affect total equity. It expects the deconsolidation to increase group net debt by about CHF 0.9 billion at the end of 2026.
The accounting change did not affect Nestlé’s sales for the third quarter or the first nine months of 2026. The company expects a limited effect on underlying results for the full year. On an annualized basis, the Russian operations represented about 2% of group sales and 3% to 4% each of underlying trading operating profit and free cash flow.
In a Sept. 18 statement, Nestlé said it was assessing its options after the decree and would take steps to protect its rights. It also said it would work to maintain business continuity in the interests of all stakeholders, particularly employees.
Nestlé maintained its 2026 outlook, forecasting organic sales growth of 3% to 4%, an underlying trading operating profit margin above 2025 levels and free cash flow above CHF 9 billion.
