Post by
mrmoribund on Feb 24, 2022 1:16pm
Apparent brilliant management of raw materials inventory
One thing that I think hasn't gotten much attention was the company's management of inventory over the course of 2021.
Essentially, they appear to have dealt with the supply chain issues by bulking up on raw material inventories in anticipation of more supply chain issues.
2020 Q4 - $7.8 million
2021 Q1 - $8.6 million
2021 Q2 - $9.5 million
2021 Q3 - $12.1 million
2021 Q4 - $10.1 million
It has dipped a bit at the end of 2021 but, regardless, I suspect this has turned out to be fantastic for the company. If orders come pouring in and you have the inventory and your competitors don't (and can't get it in a timely manner), well, that is a formula for a cash flow dream come true.
Eventually the supply chain issues will lessen and things will go back to something more like just-in-time inventories. But in the meantime Supremex may have picked up numerous now-grateful long-term customers. So the benefit should outlast the supply chain crunch.