RUSSIA— Swiss chocolate maker Lindt & Sprüngli has decided to withdraw from the Russian market five months after suspending operations in the country, citing the invasion of Ukraine.
Following a decision announced by the company in early March, to temporarily close its stores in Russia and suspend the supply of its products to the Russian market, the Lindor brand owner announced its exit in a brief statement, adding that it will continue to support its employees in Russia and act in accordance with local regulations.
Following Vladimir Putin’s invasion of Ukraine late in February, Lindt & Sprüngli’s initial stance was to continue operating its eight stores in Russia. CEO Dieter Weisskopf said on 8 March: “We are supplying [Russia] as far as we can in line with other companies,” adding the business would “look at the situation on a daily basis”.
A day later, the CHF4.6bn (US$4.8bn) global business reversed its position with a decision to close the stores, which employ 125 staff.
According to the company’s local website, eight of its nine stores operating in Russia are rented, relieving the company of unforeseen pressures. The products are also sold in the company’s own online store and in retail chains.
Russia’s Agriculture Ministry said that Lindt & Sprungli products have a negligible share of the Russian market in the high price segment.
Lindt and Sprüngli saw revenue grow 16% to 3.1 billion rubles (US$52.2 million) in 2021, and posted a net profit of 99.6 million rubles (US$1.6 million), compared to a net loss of 61 million rubles in 2020.
Russia’s Agriculture Ministry said that Lindt & Sprungli products have a negligible share of the Russian market in the high price segment. Russia and Ukraine together account for less than 1% of Lindt & Sprüngli’s total sales.
Lindt & Sprüngli’s is the latest of a series of FMGC companies to cease operations in Russia following its attack on Ukraine. Under pressure from investors and consumers, many Western companies are unwinding their investments, closing stores and pausing sales in Russia.
Lamb Weston, for instance, the US-based frozen potato products manufacturer, revealed last month it would have to write off a joint venture in Russia at a cost of US$62.7million following its initial exit announcement in May.
And in May, Denmark-headquartered dairy major Arla Foods said it had sold its Russian business to the family of local management after suspending operations in March.
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