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 Leo Kiely said Wednesday 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-and-Montreal-based company’s brands include Coors Light, Molson Canadian, Molson Dry, Carling, Kaiser, Coors and Zima.
Shares of Molson Coors Brewing fell 70 cents to close at $59.40 in Wednesday trading on the New York Stock Exchange, below their previous 52-week low of $59.77.
