Moderna Inc. (NASDAQ:MRNA)

Inventory Turnover

The inventory turnover ratio exhibits a significant upward trend from 0.17 in 2020 to 23.23 in 2023. This indicates an increasingly efficient management of inventory, with the company converting inventory into sales at a much faster rate over the years.

Receivables Turnover

Receivables turnover improved markedly from 0.14 in 2020 to 13.31 in 2022, followed by a decline to 7.48 in 2023. This suggests initially enhanced efficiency in collecting receivables, although the dip in the final year may indicate some challenges in credit collection or changes in credit policy.

Payables Turnover

The payables turnover ratio increased sharply from 0.43 in 2020 to a peak of 11.12 in 2022, then slightly declined to 9.03 in 2023. This pattern suggests the company accelerated payments to suppliers through 2022, with a modest slowdown in 2023, implying some adjustment in payment terms or cash flow management.

Working Capital Turnover

The working capital turnover ratio rose significantly from 0.10 in 2020 to 2.55 in 2021, though it declined to 0.91 by 2023. The initial rise indicates improved utilization of working capital to generate sales, but the subsequent decrease may reflect increasing working capital or slowing sales growth in later years.

Average Inventory Processing Period

The average number of days inventory is held fell dramatically from 2141 days in 2020 to just 16 days in 2023. This aligns with the high inventory turnover and demonstrates greatly improved inventory management, reducing holding times substantially.

Average Receivable Collection Period

The average collection period dropped from 2539 days in 2020 to 27 days in 2022, then increased to 49 days in 2023. The shorter periods through 2022 suggest enhanced efficiency in collecting receivables, while the increase in 2023 could point to slower collections or relaxed credit terms.

Operating Cycle

The operating cycle decreased significantly from 4680 days in 2020 to 65 days in 2023, reflecting faster inventory turnover and receivables collection. This improvement underlines more efficient operations and quicker conversion of inputs into cash over the period.

Average Payables Payment Period

The average payables payment period shortened sharply from 845 days in 2020 to around 33-40 days in the subsequent years, indicating the company began paying its suppliers more promptly after 2020, which may influence supplier relationships and credit terms.

Cash Conversion Cycle

The cash conversion cycle contracted markedly from 3835 days in 2020 to 25 days in 2023, highlighting substantially improved liquidity management through faster inventory turnover, quicker collection of receivables, and controlled payment of payables. This trend signals enhanced operational efficiency and cash flow management.

Cost of Sales

The cost of sales experienced a substantial increase from 8 million US dollars in 2020 to 2,617 million in 2021, marking a significant expansion in operational scale or sales volume. This upward trend continued into 2022, doubling to 5,416 million, reflecting robust growth. However, in 2023, the cost of sales declined to 4,693 million, indicating a possible reduction in sales volume, improved cost efficiency, or changes in production processes.

Inventory

Inventory levels showed considerable variation over the observed period. There was a sharp rise from 47 million US dollars in 2020 to 1,441 million in 2021, signaling increased stockholding possibly to meet anticipated demand or production ramp-up. Inventory then decreased to 949 million in 2022 and further decreased to 202 million in 2023. This decline indicates effective inventory management or reduced stock requirements in response to demand or sales trends.

Inventory Turnover Ratio

The inventory turnover ratio reflected significant improvement in inventory management efficiency. Starting at 0.17 in 2020, it rose to 1.82 in 2021, suggesting an enhanced rate of inventory turnover. This upward trend accelerated markedly to 5.71 in 2022 and further to 23.23 in 2023, denoting a dramatic increase in the frequency of inventory renewal. Such growth points to efficient inventory utilization, reduced holding periods, or potentially higher sales velocity relative to inventory levels.

The financial data indicates significant variability in net product sales over the observed periods. Starting with no sales recorded in 2019, the figure rose markedly to 200 million US dollars in 2020, followed by a substantial surge in 2021 reaching 17,675 million US dollars. This upward trend continued with a slight increase to 18,435 million US dollars in 2022, before experiencing a noticeable decline to 6,671 million US dollars in 2023. This pattern reflects a peak in sales in 2022, with a sharp reduction the following year.

Accounts receivable, net, showed a parallel trajectory consistent with sales activity. Beginning at 5 million US dollars in 2019, there was a steep increase to 1,391 million in 2020, then further growth to 3,175 million in 2021. However, this was followed by a decline to 1,385 million in 2022 and further down to 892 million in 2023. This trend suggests the company's receivables rose significantly alongside sales growth but later decreased as sales diminished.

Receivables turnover ratio exhibits a notable fluctuation over the years. Starting at an unreported level in 2019, it was very low at 0.14 in 2020, indicating potentially slower collection of receivables relative to sales. Subsequently, the ratio increased substantially to 5.57 in 2021 and peaked at 13.31 in 2022, suggesting improved efficiency in collecting receivables. In 2023, the turnover ratio declined to 7.48, which, while lower than the previous year, still indicates relatively efficient receivables management compared to 2020.

Net Product Sales

Strong growth from 2020 through 2022, peaking in 2022, followed by a pronounced decline in 2023.

Accounts Receivable, Net

Significant increase tracking sales growth until 2021, then decreasing in the two subsequent years consistent with lower sales.

Receivables Turnover Ratio

Marked improvement from very low efficiency in 2020 to peak efficiency in 2022, with some deceleration in 2023 but maintaining higher efficiency than in the early years.

Overall, the data suggests the company experienced rapid growth in sales during 2020-2022 with corresponding increases in receivables, alongside improving collection efficiency. The sales decline in 2023 was mirrored by a reduction in receivables and a modest decrease in turnover ratio, indicating possible adjustments in sales volume and credit management strategies during the most recent period.

Cost of Sales

The cost of sales exhibited a significant increase from 2019 to 2021, escalating from a negligible or zero base to 2,617 million US dollars in 2021. The upward trend continued into 2022, reaching a peak of 5,416 million US dollars. However, in 2023, the cost of sales slightly decreased to 4,693 million US dollars, indicating a potential stabilization or reduction in production or operational expenses.

Accounts Payable

Accounts payable followed a steady increasing trend throughout the period. Starting at 7 million US dollars in 2019, it rose to 18 million in 2020, then dramatically increased to 302 million in 2021. The upward trajectory continued reaching 487 million in 2022 and slightly increased again to 520 million in 2023. This may imply extended credit terms from suppliers or increased procurement activities aligned with operational growth.

Payables Turnover Ratio

The payables turnover ratio displayed substantial volatility over the observed years. It began at 0.43 in 2020, which is relatively low and could indicate slower payments to suppliers. This ratio then sharply increased to 8.67 in 2021, further rising to 11.12 in 2022, and slightly declined to 9.03 in 2023. The initial increase suggests improved efficiency in managing payables or a change in payment practices, while the slight decline in 2023 could indicate a moderated pace of payments or changes in supplier terms.

The analysis of the annual financial data reveals several notable trends over the five-year period.

Working Capital

Working capital exhibited a significant upward trajectory from 2019 through 2022, increasing from US$986 million to US$8,508 million. This represents very aggressive growth in the company's short-term financial strength during these years. However, in 2023, there was a decline to US$7,310 million, suggesting a slight contraction but still maintaining a relatively high level compared to the earlier years.

Net Product Sales

Net product sales experienced extraordinary growth starting from zero in 2019, reaching US$200 million in 2020 and then skyrocketing to US$17,675 million in 2021. Sales peaked slightly higher in 2022 at US$18,435 million, followed by a pronounced decline to US$6,671 million in 2023. This pattern indicates a rapid scaling of revenue followed by a substantial decrease in the most recent period.

Working Capital Turnover

Working capital turnover mirrored the sales trend to some extent. Starting from a low ratio of 0.1 in 2020, it increased sharply to 2.55 in 2021, suggesting improved efficiency in utilizing working capital to generate sales. It then slightly decreased to 2.17 in 2022 and dropped further to 0.91 in 2023. The latter decrease suggests reduced effectiveness in working capital use relative to sales during the latest year, likely influenced by the drop in product sales.

Overall, the data depicts rapid growth phases in working capital and product sales through 2021 and 2022, followed by a contraction in 2023. The declining working capital turnover in 2023 signals potential challenges in operational efficiency or demand during that year, despite still maintaining a substantial level of working capital.

Inventory Turnover

There is a pronounced upward trend in the inventory turnover ratio from 2019 to 2023. The ratio started at a very low level of 0.17 in 2020, indicating slow inventory movement initially. This figure increased substantially to 1.82 in 2021 and further accelerated to 5.71 in 2022. By 2023, the inventory turnover ratio reached 23.23, which reflects a significant improvement in the company's efficiency in managing and selling its inventory over the period analyzed.

Average Inventory Processing Period

The average inventory processing period exhibits a consistent and marked decline from 2020 to 2023, demonstrating enhanced inventory management practices. Initially, in 2020, the inventory was held for an average of 2141 days, indicating a slow turnover. This duration decreased sharply to 201 days in 2021 and continued to shorten significantly to 64 days in 2022. The most recent figure for 2023 stands at just 16 days, pointing to a highly efficient inventory processing system that allows the company to convert inventory into sales rapidly.

Overall Analysis

The data reveals a substantial improvement in inventory management over the five-year period. There is a clear inverse correlation between the inventory turnover ratio and the average inventory processing period, as expected. The company appears to have optimized its inventory flow, moving from prolonged holding times to rapid turnover. Such trends typically suggest positive operational changes, possibly including better demand forecasting, streamlined supply chain processes, or changes in product line strategy that enhance liquidity and reduce holding costs.

The data reflects notable fluctuations in the receivables turnover ratio and the average receivable collection period over the five-year span. Initially, the receivables turnover ratio was extremely low in 2020 at 0.14, indicating a very slow rate of collections relative to receivables. However, the ratio increased substantially in 2021 to 5.57, further accelerating to 13.31 in 2022, before decreasing to 7.48 in 2023.

Correspondingly, the average receivable collection period shows an inverse pattern. In 2020, it peaked at an exceptionally high level of 2,539 days, suggesting significant delays in collecting receivables during that period. This period shortened dramatically in 2021 to 66 days and further to 27 days in 2022, highlighting significant improvements in collection efficiency. However, in 2023, the collection period lengthened somewhat to 49 days, though it remained considerably lower than the 2020 level.

Overall, the trends illustrate a period of initially poor receivable management or collection difficulty in 2020 followed by substantial improvement in 2021 and 2022. The slight regression in 2023 indicates a potential area for closer monitoring, but overall the receivable turnover has markedly improved from 2020 levels.

Inventory Processing Period

The average inventory processing period shows a marked and consistent decrease over the observed years. Initially, there was no data for the year 2019, but from 2020 onwards, the period dramatically declined from 2141 days in 2020 to 16 days by 2023. This suggests a significant improvement in the efficiency of inventory turnover, indicating that inventory is held for a substantially shorter time before being processed or sold.

Receivable Collection Period

The average receivable collection period exhibits a significant fluctuation during the period analyzed. The collection period was extremely lengthy in 2020 at 2539 days, then sharply decreased to 66 days in 2021 and further decreased to 27 days in 2022. However, in 2023, there was a notable increase to 49 days. This pattern indicates efforts to improve accounts receivable collection efficiency were successful initially but saw a slight reversal in the final year.

Operating Cycle

The operating cycle declined steeply over the years for which data is available. It started at a very high 4680 days in 2020, then dropped significantly to 267 days in 2021, fell further to 91 days in 2022, and reached its lowest point at 65 days in 2023. This trend suggests an overall enhancement in the company's operational efficiency, with faster conversion of inventory and receivables into cash flow.

Summary

Collectively, the data reveals a strong trend of improvement in operational performance from 2020 through 2023. Inventory management has become substantially more efficient, and although receivable collection periods saw some volatility, the overall trend reduces the company's cash conversion cycle. The reduction in the operating cycle corroborates these gains, highlighting enhanced liquidity and potentially better working capital management. The company appears to be optimizing its operations to maintain a more agile financial posture.

The analysis of the company's payables-related financial metrics over the five-year period reveals significant changes and trends indicative of evolving operational and financial strategies.

Payables Turnover

The payables turnover ratio shows a marked increase from 0.43 in 2020 to a peak of 11.12 in 2022, followed by a slight decline to 9.03 in 2023. This trend suggests an improvement in the rate at which the company settles its supplier obligations up to 2022, indicating enhanced efficiency or possibly changing credit terms with vendors. The decrease in 2023, while still strong compared to 2020 and 2021, may reflect a stabilization or a strategic adjustment in payment practices.

Average Payables Payment Period

The average payables payment period, expressed in days, inversely mirrors the payables turnover trend. It dramatically decreased from 845 days in 2020 to 42 days in 2021, further shortening to 33 days in 2022, before lengthening marginally to 40 days in 2023. This reduction indicates a significant acceleration in payment timing, moving from a very extended period to a more standard, prompt payment cycle, which can strengthen supplier relationships and creditworthiness.

Collectively, these metrics illustrate a substantial shift from prolonged payment periods and low payables turnover toward more rapid payment cycles and higher turnover ratios. The substantial improvement from 2020 through 2022 may reflect operational changes, such as increased liquidity, revised credit policies, or a strategic emphasis on supplier management. The slight reversal in 2023 suggests a possible rebalancing of payment timing to optimize cash flow while maintaining supplier terms. This evolution indicates a company becoming more disciplined in managing its payables, likely contributing to improved financial stability and supplier confidence.

Average Inventory Processing Period

The average inventory processing period exhibits a significant and consistent decline over the reported years. Starting at an extremely high value of 2141 days in 2020, it sharply decreased to 201 days in 2021, then further reduced to 64 days in 2022, and finally settled at 16 days in 2023. This trend indicates a substantial improvement in inventory management and efficiency, resulting in faster turnover of inventory over time.

Average Receivable Collection Period

The average receivable collection period shows a similar pattern of improvement with some variability. Initially, it was exceptionally high at 2539 days in 2020, then markedly decreased to 66 days in 2021 and further to 27 days in 2022. However, it increased again to 49 days in 2023. Despite the uptick in 2023, the current level remains significantly lower than the initial value, suggesting an overall enhancement in the efficiency of receivables collection, but with some recent challenges or changes in credit terms.

Average Payables Payment Period

The average payables payment period also demonstrates a downward trend following the high of 845 days in 2020. It reduced dramatically to 42 days in 2021, slightly decreased to 33 days in 2022, and then slightly increased to 40 days in 2023. This pattern implies improved management of payment obligations and better cash flow control, although the minor increase in 2023 may warrant monitoring for potential shifts in supplier payment terms or liquidity.

Cash Conversion Cycle

The cash conversion cycle has improved remarkably throughout the period. From an excessively long cycle of 3835 days in 2020, it tightened significantly to 225 days in 2021, then further contracted to 58 days in 2022, and finally reached 25 days in 2023. This demonstrates enhanced operational efficiency and effective working capital management, with quicker conversion of investments in inventory and receivables back into cash.