Montreal – Molson Coors Brewing Co. said its Brazilian division, Cervejarias Kaiser, must stop losing money before the parent firm invests any more in the operation.
“We are unwilling to make further cash investments in Kaiser without greater certainty that it is a viable, long-term platform to compete effectively in Brazil,” Chief Executive Officer Leo Kiely said today in a press release.
Kiely said he has instructed Kaiser’s management team “to do two things. The first is to operate the Kaiser business on at least a cash break-even pace, on an operating basis.
“The second is to explore a full range of options for Brazil,” Kiely said. “We want to be in the Brazilian market, but only on a winning basis, and not at the current risk level.”
For the four-month period ended April 30, the Brazilian business unit reported a negative cash flow from operations of $3 million.
Molson Coors Brewing, created this year with the merger of Canada’s Molson Inc. and Adolph Coors Co., is the fifth-largest brewer in the world. The Golden, Colorado-based company’s brands include Coors Light, Molson Canadian, Molson Dry, Carling, Kaiser, Coors, and Zima.
The company, which posted its first financial results since the merger last quarter, said earlier this month its loss – excluding one-time items – was $8.4 million, instead of the $5.1 million loss initially reported.
