Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

Monster Beverage Corp., consolidated cash flow statement

US$ in thousands

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net income	1,630,988)	1,191,624)	1,377,475)	1,409,594)	1,107,835)
Depreciation and amortization	68,898)	61,241)	50,155)	57,030)	60,727)
Non-cash lease expense	9,043)	7,337)	4,107)	3,943)	4,087)
(Gain) loss on disposal of property and equipment	166)	(185)	(1,013)	(350)	(252)
Gain on Bang Transaction	(45,382)	—)	—)	—)	—)
Loss on impairment of intangibles	38,700)	2,200)	—)	8,700)	—)
Loss on impairment of property and equipment	4,336)	—)	—)	—)	—)
Stock-based compensation	68,836)	64,109)	70,483)	70,289)	63,356)
Deferred income taxes	2,040)	48,182)	16,429)	(156,873)	1,263)
Accounts receivable	(163,158)	(128,981)	(254,228)	(119,672)	(59,941)
Inventories	7,898)	(347,712)	(277,793)	30,304)	(85,222)
Prepaid expenses and other assets	(10,215)	(38,268)	(29,341)	1,024)	(13,774)
Prepaid income taxes	(18,833)	(4,439)	(10,919)	5,516)	9,481)
Accounts payable	112,786)	49,765)	114,297)	18,696)	28,832)
Accrued liabilities	(10,393)	(30,419)	71,586)	26,113)	(14,018)
Accrued promotional allowances	8,418)	50,821)	31,498)	13,762)	21,943)
Accrued compensation	13,398)	3,729)	7,950)	7,501)	7,228)
Income taxes payable	1,748)	(16,860)	7,221)	10,422)	8,105)
Other liabilities	22,951)	(4,540)	492)	(356)	(1,030)
Deferred revenue	(24,472)	(19,905)	(22,658)	(21,480)	(24,858)
Effect on cash of changes in operating assets and liabilities	(59,872)	(486,809)	(361,895)	(28,170)	(123,254)
Adjustments to reconcile net income to net cash provided by operating activities	86,765)	(303,925)	(221,734)	(45,431)	5,927)
Net cash provided by operating activities	1,717,753)	887,699)	1,155,741)	1,364,163)	1,113,762)
Sales of available-for-sale investments	2,029,737)	2,252,355)	1,488,599)	920,196)	851,436)
Purchases of available-for-sale investments	(1,620,718)	(1,847,067)	(2,413,143)	(1,299,981)	(1,067,736)
Acquisition of Bang Energy	(363,385)	—)	—)	—)	—)
Acquisition of CANarchy, net of cash	—)	(329,472)	—)	—)	—)
Purchases of property and equipment	(221,428)	(188,726)	(43,868)	(48,722)	(101,661)
Proceeds from sale of property and equipment	2,520)	1,313)	1,328)	993)	1,239)
Additions to intangibles	(13,296)	(23,427)	(13,585)	(18,550)	(8,737)
Increase in other assets	(6,825)	(26,343)	(11,353)	(26,423)	(1,265)
Net cash used in investing activities	(193,395)	(161,367)	(992,022)	(472,487)	(326,724)
Borrowings (payments) on debt	(13,914)	75)	2,928)	(3,086)	(13,569)
Issuance of common stock	130,267)	64,015)	45,723)	72,936)	92,363)
Purchases of common stock held in treasury	(658,952)	(771,028)	(13,830)	(595,918)	(707,300)
Net cash provided by (used in) financing activities	(542,599)	(706,938)	34,821)	(526,068)	(628,506)
Effect of exchange rate changes on cash and cash equivalents	8,775)	(38,715)	(52,491)	16,848)	1,912)
Net increase (decrease) in cash and cash equivalents	990,534)	(19,321)	146,049)	382,456)	160,444)
Cash and cash equivalents, beginning of year	1,307,141)	1,326,462)	1,180,413)	797,957)	637,513)
Cash and cash equivalents, end of year	2,297,675)	1,307,141)	1,326,462)	1,180,413)	797,957)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

The financial data exhibit several noteworthy trends and patterns over the five-year period analyzed. The net income demonstrates overall growth with fluctuations, increasing from 1,107,835 thousand US$ in 2019 to a peak of 1,630,988 thousand US$ in 2023, despite a dip in 2022. Depreciation and amortization expenses generally show a slight decline through 2021, followed by an upward trend through 2023. Non-cash lease expenses have steadily increased each year, more than doubling from 4,087 thousand US$ in 2019 to 9,043 thousand US$ in 2023.

The company recorded a gain on disposal of property and equipment in the earlier years which turned into a minor loss by 2023. Impairment losses on intangibles and property and equipment emerged in later years, with significant intangible impairment losses recognized especially in 2023 (38,700 thousand US$). Additionally, a notable one-time gain related to the Bang transaction was recorded in 2023 (−45,382 thousand US$), indicating a special event affecting results that year.

Stock-based compensation expenses remained relatively stable over the years, fluctuating around the 63,000–70,000 thousand US$ range. Deferred income taxes show significant volatility, switching between positive and negative values without a clear directional trend. Accounts receivable have increased negatively over time, indicating a rising cash inflow from customers or a reduction in outstanding receivables. Inventories followed a volatile pattern, including large negative values in some years, with a somewhat positive reversal by 2023.

Prepaid expenses, income taxes, and other assets reflect variable movements, with no persistent trend. Accounts payable increased steadily, particularly rising sharply in 2021 and 2023. Accrued liabilities and promotional allowances showed fluctuations, with accrued promotional allowances peaking in 2022 before declining in 2023. Accrued compensation and income taxes payable also display irregular movements, suggesting occasional timing differences or operational changes.

The effect of changes in operating assets and liabilities on cash flow was predominantly negative in all years, with the largest outflow observed in 2022. Correspondingly, adjustments reconciling net income to net cash from operating activities exhibited significant negative values except for notable positive adjustment in 2023.

Net cash provided by operating activities, despite fluctuations, remained strong and positive through the period, with a dip in 2022 and a substantial increase by 2023, reaching its highest level in the period analyzed (1,717,753 thousand US$).

Investing activities reveal large cash outflows consistent with acquisitions and capital expenditures. Significant purchases of available-for-sale investments and capital expenditures are evident, with acquisitions notably impacting 2022 and 2023 (including Bang Energy acquisition in 2023 and CANarchy acquisition in 2022). Proceeds from sales of property and equipment remained modest but slightly increased by 2023. The net cash used in investing activities peaked in 2021 due to sizable investment activities but decreased substantially thereafter.

Financing activities present mixed patterns. Issuance of common stock fluctuated, increasing significantly in 2023. Purchases of treasury stock exhibited large cash outflows in several years, especially in 2019, 2020, 2022, and 2023. Borrowings and repayments of debt were relatively minor and inconsistent, with no evident long-term debt financing or repayment trend. Overall, net cash from financing activities was negative in most years, reflecting substantial treasury stock repurchases and some repayments.

The effect of exchange rate changes on cash and cash equivalents varied widely, with positive impacts in some years and significant negative effects in others, particularly during 2021 and 2022. The net increase (decrease) in cash and cash equivalents remained positive except in 2022, which reflected a small decline compared to the other periods.

Consequently, cash and cash equivalents at year-end showed a clear upward trajectory from 797,957 thousand US$ in 2019 to 2,297,675 thousand US$ in 2023, signifying a strengthening liquidity position by the end of the period. Despite variability in investing and financing cash flows, operating cash flows and cash balances reflect strong cash generation capabilities and liquidity management over the years.

Net income and profitability: Increased overall with fluctuations; high in 2023 despite a dip in 2022.
Depreciation, amortization, and lease expenses: Declined until 2021 then increased; non-cash lease expense consistently rose.
Impairment and one-off items: Impairments appeared mainly after 2020; a significant Bang transaction gain recorded in 2023.
Working capital changes and operating cash flow: Operating assets and liabilities changes generally reduced cash; operating cash flow remained strong despite fluctuations.
Investing activities: Characterized by large outflows for acquisitions and investments, peaking in 2021, then reducing.
Financing activities: Fluctuating equity issuances, large treasury stock repurchases, minor debt activity, mainly cash outflows overall.
Cash position: Consistent growth in cash and equivalents, reaching a high in 2023.

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Monster Beverage Corp. (NASDAQ:MNST)

Cash Flow Statement