Nestle is in talks to sell its remaining ice cream businesses as part of CEO Philipp Navratil’s drive to streamline the sprawling Swiss consumer food group, the company said at its fourth-quarter results on Thursday.

The maker of Maggi stock cubes and Nescafé coffee said it was in advanced talks to sell ice cream businesses in Asia, Canada and parts of Latin America to Häagen-Dazs owner Froneri, a joint venture which Nestle established with European buyout firm PAI Partners.

Nestle holds a 50% stake in Froneri, which was valued at some 15 billion euros ($18 billion) including debt, in October last year when Goldman Sachs and the state-linked Abu Dhabi Investment Authority invested in the business.

Nestle plans to focus on its coffee, petcare, nutrition and food & snacks units, it said in a statement, as it reported better than expected fourth-quarter sales growth.

“We are accelerating executions with a leaner, more performance-driven organisation, and the stage is set for continuous improvement in 2026 and beyond,” Navratil told reporters.

CEO sees no long-term reputational issue from recalls

Navratil’s efforts to overhaul the packaged goods producer have been overshadowed by the biggest infant formula recall in Nestle’s recent history.

The CEO said the company had acted swiftly and transparently to earn the trust of regulators and consumers.

“There might be some impact from the recall, but then I think there is not a long-term reputational issue that we’re facing,” he said, anticipating no spill over across products.

Nestle, whose shares were up 2.8% by 0900 GMT, is expecting 2026 full-year organic sales growth to be in the range of 3-4%. Nestle forecasts its underlying trading operating profit margin this year would rise from 16.1% in 2025, and expects real internal growth (RIG) - or sales volumes growth - to come in above last year’s 0.8%.

Nestle looks at vitamin, water business

Navratil, who announced plans to cut 16,000 jobs soon after taking the helm in September, has been battling the negative impacts from U.S. import tariffs and foreign exchange, as well as consumers with less purchasing power.

Nestle said it had concluded the strategic review of its mainstream and value vitamin and supplement brands and was looking to engage with potential buyers. It said it also expects to deconsolidate its waters business from 2027, and began the formal process with potential partners in the first quarter.

Analysts have suggested that U.S. frozen foods could be another division for the chop, but Navratil said that it remained part of the portfolio as a profitable, cash-generative asset.

Nestle trimmed net debt to 51.4 billion Swiss francs by the end of December, from 60 billion Swiss francs in June, thanks in part to strong cash flow generation. The board will propose a 5 centime increase in the dividend to 3.10 Swiss francs per share.

“Strong free cash flow and slashed net debt establish a solid foundation for a reset,” said Vontobel analysts.

Organic sales, which exclude the impact of currency movements and acquisitions, rose 4% in the quarter ended December 31, above expectations for 3.4% growth.

That was led by price increases of 2.8%, roughly in line with analyst expectations, and RIG of 1.3%, outperforming expectations for a 0.9% increase.