Trevi Therapeutics, Inc. (TRVI) Cash Flow Statement

The OCF/NI ratio fluctuates around 1.0, suggesting that reported net losses are largely cash-based, with non-cash items like SBC and D&A having a modest impact. In 2026Q1, OCF exceeded net loss (ratio 1.27), possibly due to working capital outflows, while in 2024Q2 the ratio was 0.70, indicating some non-cash expenses. This consistency implies that cash burn is a reliable proxy for earnings quality, with no significant accrual red flags.

The FCF trajectory shows a clear acceleration in cash consumption, driven by escalating R&D spending as noted in the income statement analysis. The positive FCF in 2025Q4 ($5.8M) appears anomalous, likely due to a $13.5M capex inflow (possibly a sale-leaseback or asset disposal), which is not sustainable. Excluding that quarter, FCF has been consistently negative and worsening, indicating that the company is in a high-burn phase as it advances its pipeline.

CapEx is immaterial relative to operating expenses, with the only notable exception being a $13.5M inflow in 2025Q4, which likely represents a disposal or refund rather than investment. This suggests that Trevi's cash burn is almost entirely operational, funding R&D and SG&A, with no significant fixed asset base to maintain. The lack of capex implies that future growth will not require heavy capital investment, but the company remains dependent on external funding for its operating losses.

The working capital adjustments are relatively small compared to the overall burn, but they do cause quarterly OCF to deviate from net income. For instance, in 2026Q2, a positive $5.4M working capital change reduced cash burn, while in 2026Q1, a negative $5.4M increased it. These swings likely reflect the timing of vendor payments and clinical trial accruals, which are common in biotech. Investors should monitor whether these fluctuations indicate any strain in supplier relationships or simply normal quarter-end timing.

Capital deployment is entirely focused on funding the operating loss, with no distributions to shareholders. This is typical for a pre-revenue biotech, where preserving cash for R&D is paramount. The absence of buybacks or dividends suggests that management is prioritizing pipeline advancement over shareholder returns, which is consistent with the company's stage. However, the escalating burn rate raises questions about the sufficiency of existing cash reserves and the need for future capital raises.

The cumulative gap between net income and operating cash flow is only about $7M, which is small relative to the total burn. This suggests that the losses are almost entirely cash-based, with minimal non-cash adjustments. The slight difference can be attributed to stock-based compensation and working capital changes, but overall, the cash flow statement confirms that the company is burning cash at a rate consistent with its reported losses. This alignment reduces the risk of accounting distortions, but the sheer magnitude of the burn remains a concern.