Darling Ingredients Inc. Reports Second Quarter 2021 Financial Results

IRVING, Texas, Aug 10, 2021 /PRNewswire/ — Darling Ingredients Inc. (NYSE: DAR, «Darling») — …

IRVING, Texas, Aug 10, 2021 /PRNewswire/ — Darling Ingredients Inc. (NYSE: DAR, «Darling») —

Second Quarter 2021

  • Net income of $196.6 million, or $1.17 per GAAP diluted share
  • Net Sales of $1.2 billion
  • Combined adjusted EBITDA of $353.7 million
  • Global Ingredients business reported a record Q2 EBITDA of $221.7 million
  • Renewable diesel JV, DGD generated a record quarter, contributing $132.0 million of EBITDA to Darling
  • Darling repurchased approximately $76 million of common stock in the second quarter
  • Darling trailing twelve-month combined adjusted EBITDA surpasses $1 billion, first time in company history
  • DGD Norco, LA 400 million gallon renewable diesel project on track to be fully operational in middle of Q4 2021
  • DGD Port Arthur, TX 470 million gallon renewable diesel project expected completion now in first half of 2023

Darling reported net sales of $1.2 billion for the second quarter of 2021, as compared with net sales of $848.7 million for the same period a year ago.  Net income attributable to Darling for the three months ended July 3, 2021 was $196.6 million, or $1.17 per diluted share, compared to net income of $65.4 million, or $0.39 per diluted share, for the second quarter of 2020.

«Our global ingredients business continues to perform at the highest levels producing a record adjusted EBITDA of approximately $222 million for the second quarter,» said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. «We continue to see positive signs of strength in a recovering economy both here in North America and around the world which should provide for sustained demand for food, feed and fuel, empowering Darling to take advantage of our leadership position in the industry.»

«Darling’s 2021 first half financial performance was strong, as we generated a combined adjusted EBITDA of $638.5 million and with the continued strength of commodity pricing for our global ingredients business expected through the rest of 2021, and the 400 million gallon renewable diesel expansion of DGD Norco, LA starting up in the near term, we are once again increasing our combined adjusted EBITDA guidance for 2021 to approximately $1.275 billion,» commented Stuewe.  

Under Darling’s current share repurchase authorization, the Company repurchased 1.14 million shares of common stock during the second quarter for a total of $75.7 million. Darling has approximately $124.3 million remaining under its current authorization.

For the six months ended July 3, 2021, Darling reported net sales of $2.25 billion, as compared with net sales of $1.7 billion for the same period of 2020. Net Income attributable to Darling for the first six months of 2021 was $348.3 million, or $2.08 per diluted share, as compared to a net income of $150.9 million, or $0.90 per diluted share, for the first six months of 2020.

As of July 3, 2021, Darling had $77.9 million in cash and cash equivalents, and $902.1 million available under its committed revolving credit agreement. Total debt outstanding as of July 3, 2021 was $1.4 billion. Capital expenditures (exclusive of DGD investments) of $126.1 million were made during the first six months of fiscal 2021, compared to $123.2 million in the first six months of fiscal 2020.

Combined adjusted EBITDA was $353.7 million for the second quarter of 2021, compared to $195.2 million for the same period in 2020. On a year-to-date basis, combined adjusted EBITDA totaled $638.5 million for 2021, compared to $408.5 million on a year-to-date basis for 2020.


Segment Financial Tables (in thousands) 


(unaudited)


Three Months Ended July 3, 2021

Feed

Ingredients

Food

Ingredients

Fuel

Ingredients

Corporate

Total









Net Sales

$       771,932

$       317,031

$       109,706

$                –

$     1,198,669


Cost of sales and operating expenses

556,424

238,539

83,110

878,073


Gross Margin

$       215,508

$         78,492

$         26,596

$                –

$        320,596









Gain on sale of assets

(122)

(48)

(58)

(228)


Selling, general and administrative expenses

54,977

25,542

4,474

14,139

99,132


Depreciation and amortization

53,971

15,850

6,698

2,703

79,222


Equity in net income of Diamond Green Diesel

125,788

125,788


Segment operating income/(loss)

$       106,682

$         37,148

$       141,270

$     (16,842)

$        268,258


Equity in net income of other unconsolidated subsidiaries

$           1,940

$                   –

$                   –

$                –

$            1,940


Segment Income/(loss)

$       108,622

$         37,148

$       141,270

$     (16,842)

$        270,198









Segment EBITDA

$       160,653

$         52,998

$         22,180

$     (14,139)

$        221,692


DGD adjusted EBITDA (Darling’s Share)

$                   –

$                   –

$       132,001

$                –

$        132,001


Combined adjusted EBITDA

$       160,653

$         52,998

$       154,181

$     (14,139)

$        353,693









Three Months Ended June 27, 2020

Feed

Ingredients

Food

Ingredients

Fuel

Ingredients

Corporate

Total









Net Sales

$       503,690

$       278,934

$         66,049

$                –

$        848,673


Cost of sales and operating expenses

367,902

220,159

44,286

632,347


Gross Margin

$       135,788

$         58,775

$         21,763

$                –

$        216,326









Loss/(gain) on sale of assets

76

(48)

(1)

27


Selling, general and administrative expenses

50,484

22,564

3,953

13,192

90,193


Depreciation and amortization

52,683

19,972

7,980

2,675

83,310


Equity in net income of Diamond Green Diesel

63,492

63,492


Segment operating income/(loss)

$         32,545

$         16,287

$         73,323

$     (15,867)

$        106,288


Equity in net income of other unconsolidated subsidiaries

$              692

$                   –

$                   –

$                –

$               692


Segment income/(loss)

$         33,237

$         16,287

$         73,323

$     (15,867)

$        106,980









Segment EBITDA

$         85,228

$         36,259

$         17,811

$     (13,192)

$        126,106


DGD adjusted EBITDA (Darling’s Share)

$                   –

$                   –

$         69,108

$                –

$          69,108


Combined adjusted EBITDA

$         85,228

$         36,259

$         86,919

$     (13,192)

$        195,214
















Six Months Ended July 3, 2021

Feed

Ingredients

Food

Ingredients

Fuel

Ingredients

Corporate

Total









Net Sales

$    1,423,376

$       615,096

$       206,913

$                –

$     2,245,385


Cost of sales and operating expenses

1,031,005

464,952

154,900

1,650,857


Gross Margin

$       392,371

$       150,144

$         52,013

$                –

$        594,528









Loss/(gain) on sale of assets

(261)

7

(38)

(292)


Selling, general and administrative expenses

107,597

50,733

9,341

28,859

196,530


Restructuring and asset impairment charges

778

778


Depreciation and amortization

108,580

30,733

12,853

5,590

157,756


Equity in net income of Diamond Green Diesel

228,013

228,013


Segment operating income/(loss)

$       176,455

$         68,671

$       257,092

$     (34,449)

$        467,769


Equity in net income of other unconsolidated subsidiaries

$           2,552

$                   –

$                   –

$                –

$            2,552


Segment income/(loss)

$       179,007

$         68,671

$       257,092

$     (34,449)

$        470,321









Segment EBITDA

$       285,035

$         99,404

$         42,710

$     (28,859)

$        398,290


DGD adjusted EBITDA (Darling’s Share)

$                   –

$                   –

$       240,201

$                –

$        240,201


Combined adjusted EBITDA

$       285,035

$         99,404

$       282,911

$     (28,859)

$        638,491









Six Months Ended June 27, 2020

Feed

Ingredients

Food

Ingredients

Fuel

Ingredients

Corporate

Total









Net Sales

$    1,016,315

$       549,228

$       135,972

$                –

$     1,701,515


Cost of sales and operating expenses

756,355

425,589

97,311

1,279,255


Gross Margin

$       259,960

$       123,639

$         38,661

$                –

$        422,260









Loss/(gain) on sale of assets

126

(46)

8

88


Selling, general and administrative expenses

104,431

48,040

5,607

28,308

186,386


Depreciation and amortization

106,204

40,277

16,072

5,428

167,981


Equity in net income of Diamond Green Diesel

161,312

161,312


Segment operating income/(loss)

$         49,199

$         35,368

$        178,286

$     (33,736)

$        229,117


Equity in net income of other unconsolidated subsidiaries

$           1,561

$                   –

$                    –

$                –

$            1,561


Segment income/(loss)

$         50,760

$         35,368

$        178,286

$     (33,736)

$        230,678









Segment EBITDA

$       155,403

$         75,645

$         33,046

$     (28,308)

$        235,786


DGD adjusted EBITDA (Darling’s Share)

$                   –

$                   –

$       172,742

$                –

172,742


Combined adjusted EBITDA

$       155,403

$         75,645

$       205,788

$     (28,308)

$        408,528









 

Darling Ingredients Inc. and Subsidiaries

Consolidated Balance Sheets

July 3, 2021 and January 2, 2021

(in thousands)



July 3,


January 2,



2021


2021


ASSETS

(unaudited)




Current assets:






Cash and cash equivalents

$              77,741


$              81,617



Restricted cash

177


103



Accounts receivable, net

433,441


405,387



Inventories

428,203


405,922



Prepaid expenses

58,648


47,793



Income taxes refundable

2,636


3,883



Other current assets

21,734


42,289




Total current assets

1,022,580


986,994


Property, plant and equipment, net

1,846,814


1,863,814


Intangible assets, net

439,035


473,680


Goodwill

1,245,549


1,260,240


Investment in unconsolidated subsidiaries

1,037,436


804,682


Operating lease right-of-use assets

165,034


146,563


Other assets

61,000


60,682


Deferred income taxes

15,875


16,676



$         5,833,323


$         5,613,331


LIABILITIES AND STOCKHOLDERS’ EQUITY





Current liabilities:






Current portion of long-term debt

$              41,603


$              27,538



Accounts payable, principally trade

264,447


255,340



Income taxes payable

25,096


17,497



Current operating lease liabilities

40,228


39,459



Accrued expenses

320,838


335,471




Total current liabilities

692,212


675,305


Long-term debt, net of current portion

1,393,798


1,480,531


Long-term operating lease liabilities

126,527


109,707


Other noncurrent liabilities

115,510


117,371


Deferred income taxes

321,466


276,208



Total liabilities

2,649,513


2,659,122


Commitments and contingencies





Total Darling’s stockholders’ equity

3,118,576


2,891,909


Noncontrolling interests

65,234


62,300



Total stockholders’ equity

$         3,183,810


$         2,954,209



$         5,833,323


$         5,613,331







 

Darling Ingredients Inc. and Subsidiaries

Consolidated Operating Results

For the Three-Month and Six-Month Periods Ended July 3, 2021 and June 27, 2020

(in thousands, except per share data)       















Three Months Ended




Six Months Ended




(unaudited)


$ Change




(unaudited)


$ Change




July 3,


June 27,


Favorable




July 3,


June 27,


Favorable




2021


2020


(Unfavorable)




2021


2020


(Unfavorable)


Net sales

$    1,198,669


$       848,673


$        349,996




$    2,245,385


$     1,701,515


$        543,870


Costs and expenses:
















Cost of sales and operating expenses

878,073


632,347


(245,726)




1,650,857


1,279,255


(371,602)



Loss (gain) on sale of assets

(228)


27


255




(292)


88


380



Selling, general and administrative expenses

99,132


90,193


(8,939)




196,530


186,386


(10,144)



Restructuring and asset impairment charges






778



(778)



Depreciation and amortization

79,222


83,310


4,088




157,756


167,981


10,225


Total costs and expenses

1,056,199


805,877


(250,322)




2,005,629


1,633,710


(371,919)



Equity in net income of Diamond Green Diesel

125,788


63,492


62,296




228,013


161,312


66,701


Operating income

268,258


106,288


161,970




467,769


229,117


238,652


Other expense:
















Interest expense

(15,268)


(17,920)


2,652




(31,696)


(37,010)


5,314



Foreign currency gain / (loss)

(684)


(1,134)


450




(1,094)


530


(1,624)



Other expense, net

(1,198)


(1,485)


287




(2,357)


(3,366)


1,009


Total other expense

(17,150)


(20,539)


3,389




(35,147)


(39,846)


4,699


Equity in net income















    of other unconsolidated subsidiaries

1,940


692


1,248




2,552


1,561


991


Income from operations before income taxes

253,048


86,441


166,607




435,174


190,832


244,342


Income tax expense

54,979


19,946


(35,033)




83,687


38,246


(45,441)


Net income

198,069


66,495


131,574




351,487


152,586


198,901


Net income attributable to
















noncontrolling interests

(1,487)


(1,056)


(431)




(3,139)


(1,637)


(1,502)


Net income attributable to Darling

$       196,582


$         65,439


$        131,143




$       348,348


$        150,949


$        197,399


















Basic income per share:

$             1.21


$             0.40


$              0.81




$             2.14


$              0.93


$              1.21


Diluted income per share:

$             1.17


$             0.39


$              0.78




$             2.08


$              0.90


$              1.18


















Number of diluted common shares:

167,597


165,999






167,673


166,963




















 

Darling Ingredients Inc. and Subsidiaries

Consolidated Statement of Cash Flows

Periods Ended July 3, 2021 and June 27, 2020

(in thousands)

(unaudited)  






Six Months Ended






July 3,


June 27,


Cash flows from operating activities:

2021


2020



Net income


$  351,487


$  152,586



Adjustments to reconcile net income to net cash provided by operating activities:







Depreciation and amortization

157,756


167,981




Loss/(gain) on sale of assets

(292)


88




Asset impairment


138





Deferred taxes


49,572


13,998




Decrease in long-term pension liability

(622)


(890)




Stock-based compensation expense

14,011


15,566




Write-off deferred loan costs

598





Deferred loan cost amortization

2,047


2,835




Equity in net income of Diamond Green Diesel and other unconsolidated subsidiaries

(230,565)


(162,873)




Distributions of earnings from Diamond Green Diesel and other unconsolidated subsidiaries

2,497


125,891




Changes in operating assets and liabilities, net of effects from acquisitions:







     Accounts receivable

(34,911)


26,077




     Income taxes refundable/payable

9,116


6,119




     Inventories and prepaid expenses

(39,992)


(35,413)




     Accounts payable and accrued expenses

2,770


(33,375)




     Other


14,327


(14,941)





Net cash provided by operating activities

297,937


263,649


Cash flows from investing activities:






Capital expenditures

(126,094)


(123,204)



Acquisitions, net of cash acquired

(2,059)




Investment in unconsolidated subsidiaries

(4,449)




Gross proceeds from disposal of property, plant and equipment and other assets

3,064


1,053



Payments related to routes and other intangibles

(347)


(3,712)





Net cash used by investing activities

(129,885)


(125,863)


Cash flows from financing activities:






Proceeds from long-term debt

20,679


16,164



Payments on long-term debt

(73,393)


(18,239)



Borrowings from revolving credit facility

207,000


375,971



Payments on revolving credit facility

(220,000)


(405,800)



Net cash overdraft financing

16,487


(26,461)



Issuance of common stock

50


67



Repurchase of common stock

(75,663)


(55,044)



Minimum withholding taxes paid on stock awards

(43,853)


(4,863)



Acquisition of noncontrolling interest


(8,784)



Distributions to noncontrolling interests

(2,164)


(987)





Net cash used by financing activities

(170,857)


(127,976)


Effect of exchange rate changes on cash flows

(997)


(6,567)


Net increase / (decrease) in cash, cash equivalents and restricted cash

(3,802)


3,243


Cash, cash equivalents and restricted cash at beginning of period

81,720


73,045


Cash, cash equivalents and restricted cash at end of period

$        77,918


$        76,288


Supplemental disclosure of cash flow information:






Accrued capital expenditures

$          1,101


$               23



Cash paid during the period for:







Interest, net of capitalized interest

$        29,928


$        35,070




Income taxes, net of refunds

$        25,270


$        18,030



Non-cash operating activities:







Operating lease right of use obtained in exchange for new lease liabilities

$        44,218


$        28,801



Non-cash financing activities:







Debt issued for service contract assets

$               60


$               21










 

Diamond Green Diesel Joint Venture

Condensed Consolidated Balance Sheets

June 30, 2021 and December 31, 2020

(in thousands)






June 30,


December  31,





2021


2020

Assets:



 (unaudited) 




Total current assets


$        464,631


$       383,557


Property, plant and equipment, net


1,727,979


1,238,726


Other assets


35,369


36,082



Total assets


$     2,227,979


$    1,658,365








Liabilities and members’ equity:






Total current portion of long term debt


$               581


$              517


Total other current liabilities


205,484


99,787


Total long term debt


8,635


8,705


Total other long term liabilities


8,555


3,758


Total members’ equity


2,004,724


1,545,598



Total liabilities and members’ equity


$     2,227,979


$    1,658,365








 

Diamond Green Diesel Joint Venture

Operating Financial Results

For the Three-Month and Six-Month Periods Ended June 30, 2021 and June 30, 2020

(in thousands)
















Three Months Ended




Six Months Ended




(unaudited)


$ Change




(unaudited)


$ Change




June 30,


June 30,


Favorable




June 30,


June 30,


Favorable

Revenues:

2021


2020


(Unfavorable)




2021


2020


(Unfavorable)


Operating revenues

$        571,859


$        295,826


$          276,033




$     1,003,492


$        654,441


$        349,051

Expenses:















Total costs and expenses less
















depreciation, amortization and

accretion expense

307,857


157,611


(150,246)




523,091


308,958


(214,133)


Depreciation, amortization and

11,995


11,114


(881)




23,682


22,888


(794)



accretion expense














Total costs and expenses

319,852


168,725


(151,127)




546,773


331,846


(214,927)


Operating income 

252,007


127,101


124,906




456,719


322,595


134,124

Other income

353


200


153




411


661


(250)



Interest and debt expense, net

(784)


(317)


(467)




(1,104)


(632)


(472)



Net income 

$        251,576


$        126,984


$          124,592




$        456,026


$        322,624


$        133,402

















Darling Ingredients Inc. reports Adjusted EBITDA results, which is a Non-GAAP financial measure, as a complement to results provided in accordance with generally accepted accounting principles (GAAP) (for additional information, see «Use of Non-GAAP Financial Measures» included later in this media release). The Company believes that Adjusted EBITDA provides additional useful information to investors. Adjusted EBITDA, as the Company uses the term, is calculated below:

Reconciliation of Net Income to (Non-GAAP) Adjusted EBITDA and (Non-GAAP) Pro forma Adjusted EBITDA

For the Three-Month and Six-Month Periods Ended July 3, 2021 and June 27, 2020




Three Months Ended



Six Months Ended 


Adjusted EBITDA 

July 3,


June 27,



July 3,


June 27,


(U.S. dollars in thousands)

2021


2020



2021


2020













Net income attributable to Darling

$       196,582


$            65,439



$       348,348


$          150,949


Depreciation and amortization

79,222


83,310



157,756


167,981


Interest expense

15,268


17,920



31,696


37,010


Income tax expense

54,979


19,946



83,687


38,246


Restructuring and asset impairment charges




778



Foreign currency loss / (gain)

684


1,134



1,094


(530)


Other expense, net

1,198


1,485



2,357


3,366


Equity in net income of Diamond Green Diesel

(125,788)


(63,492)



(228,013)


(161,312)


Equity in net income of other unconsolidated subsidiaries

(1,940)


(692)



(2,552)


(1,561)


Net income attributable to noncontrolling interests

1,487


1,056



3,139


1,637



Adjusted EBITDA (Non-GAAP)

$       221,692


$       126,106



$       398,290


$       235,786


Foreign currency exchange impact 

(11,493)

(1)



(19,542)

(2)



 Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP)

$       210,199


$       126,106



$       378,748


$       235,786


DGD Joint Venture Adjusted EBITDA (Darling’s Share)

$       132,001


$          69,108



$       240,201


$       172,742













Darling plus Darling’s share of DGD Joint Venture Adjusted EBITDA 

$       353,693


$       195,214



$       638,491


$       408,528



(1) The average rate assumption used in this calculation was the actual fiscal average rate for the three months ended July 3, 2021 of €1.00:USD$1.21 and CAD$1.00:USD$0.81, as compared to the average rate for the three months ended June 27, 2020 of  €1.00:USD$1.10 and CAD$1.00:USD$0.72, respectively.

(2) The average rate assumption used in this calculation was the actual fiscal average rate for the six months ended July 3, 2021 of €1.00:USD$1.20 and CAD$1.00:USD$0.80, as compared to the average rate for the six months ended June 27, 2020 of  €1.00:USD$1.10 and CAD$1.00:USD$0.73, respectively.

About Darling

Darling Ingredients Inc. (NYSE: DAR) is a world leading producer of organic ingredients, generating a wide array of sustainable protein and fat products while being one of the largest producers of renewable clean energy. With operations on five continents, Darling collects waste streams from the agri-food industry, repurposing into specialty ingredients, such as hydrolyzed collagen, edible and feed-grade fats, animal proteins and meals, plasma, pet food ingredients, fuel feedstocks, and green bioenergy. Darling Ingredients named one of the 50 Sustainability and Climate Leaders in 2021, to learn more Darling Ingredients: The greenest Company on the planet – 50 Sustainability & Climate Leaders (50climateleaders.com). The Company sells its ingredients around the globe and works to strengthen our promise for a better tomorrow, creating product applications for health, nutrients and bioenergy while optimizing our services to the food chain. Darling is a 50% joint venture partner in Diamond Green Diesel (DGD), North America’s largest renewable diesel manufacturer, currently producing approximately 290 million gallons of renewable diesel annually which products reduce Greenhouse Gas (GHG) emissions by up to 85% compared to fossil fuels. For additional information, visit the Company’s website at http://www.darlingii.com.

Darling Ingredients Inc. will host a conference call to discuss the Company’s second quarter 2021 financial results at 9:00 am Eastern Time (8:00 am Central Time) on Wednesday, August 11, 2021.  To listen to the conference call, participants calling from within North America should dial 1-844-868-8847; international participants should dial 1-412-317-6593.  Please refer to access code 10158835. Please call approximately ten minutes before the start of the call to ensure that you are connected.

The call will also be available as a live audio webcast that can be accessed on the Company website at http://ir.darlingii.com. Beginning one hour after its completion, a replay of the call can be accessed through August 18, 2021, by dialing 1-877-344-7529 (U.S. callers), 1-855-669-9658 (Canada) and 1-412-317-0088 (international callers).  The access code for the replay is 10158835.  The conference call will also be archived on the Company’s website.

Use of Non-GAAP Financial Measures:

Adjusted EBITDA is not a recognized accounting measurement under GAAP; it should not be considered as an alternative to net income, as a measure of operating results, or as an alternative to cash flow as a measure of liquidity and is not intended to be a presentation in accordance with GAAP.  Adjusted EBITDA is presented here not as an alternative to net income, but rather as a measure of the Company’s operating performance. Since EBITDA (generally, net income plus interest expense, taxes, depreciation and amortization) is not calculated identically by all companies, this presentation may not be comparable to EBITDA or Adjusted EBITDA presentations disclosed by other companies. Adjusted EBITDA is calculated in this presentation and represents, for any relevant period, net income/(loss) plus depreciation and amortization, goodwill and long-lived asset impairment, interest expense, (income)/loss from discontinued operations, net of tax, income tax provision, other income/(expense) and equity in net loss of unconsolidated subsidiary. Management believes that Adjusted EBITDA is useful in evaluating the Company’s operating performance compared to that of other companies in its industry because the calculation of Adjusted EBITDA generally eliminates the effects of financing, income taxes and certain non-cash and other items that may vary for different companies for reasons unrelated to overall operating performance.

Pro forma Adjusted EBITDA to Foreign Currency is not a recognized accounting measurement under GAAP. The Company evaluates the impact of foreign currency on its adjusted EBITDA. DGD Joint Venture Adjusted EBITDA (Darling’s share) is not reflected in the Adjusted EBITDA or the Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP).

As a result, the Company’s management uses Adjusted EBITDA as a measure to evaluate performance and for other discretionary purposes. In addition to the foregoing, management also uses or will use Adjusted EBITDA to measure compliance with certain financial covenants under the Company’s Senior Secured Credit Facilities, 5.25% Notes and 3.625% Notes that were outstanding at July 3, 2021. However, the amounts shown in this presentation for Adjusted EBITDA differ from the amounts calculated under similarly titled definitions in the Company’s Senior Secured Credit Facilities, 5.25% Notes and 3.625% Notes, as those definitions permit further adjustments to reflect certain other non-recurring costs, non-cash charges and cash dividends from the DGD Joint Venture. Additionally, the Company evaluates the impact of foreign exchange impact on operating cash flow, which is defined as segment operating income (loss) plus depreciation and amortization.

Information reconciling forward-looking combined adjusted EBITDA to net income is unavailable to the Company without unreasonable effort. The Company is not able to provide reconciliations of combined adjusted EBITDA to net income because certain items required for such reconciliations are outside of the Company’s control and/or cannot be reasonably predicted, such as the impact of volatile commodity prices on the Company’s operations, impact of foreign currency exchange fluctuations, depreciation and amortization and the provision for income taxes. Preparation of such reconciliations for Darling Ingredients Inc. and the Company’s joint venture, Diamond Green Diesel, would require a forward-looking balance sheet, statement of income and statement of cash flow, prepared in accordance with GAAP for each entity, and such forward-looking financial statements are unavailable to the Company without unreasonable effort. The Company provides a range for its combined adjusted EBITDA outlook that it believes will be achieved; however, it cannot accurately predict all the components of the combined adjusted EBITDA calculation.

Cautionary Statements Regarding Forward-Looking Information:

{This media release contains «forward-looking» statements regarding the business operations and prospects of Darling Ingredients Inc. and industry factors affecting it. These statements are identified by words such as «believe,» «anticipate,» «expect,» «estimate,» «intend,» «could,» «may,» «will,» «should,» «planned,» «potential,» «continue,» «momentum,» «combined adjusted EBITDA guidance» and other words referring to events that may occur in the future.  These statements reflect Darling Ingredient’s current view of future events and are based on its assessment of, and are subject to, a variety of risks and uncertainties beyond its control, each of which could cause actual results to differ materially from those indicated in the forward-looking statements.  These factors include, among others, existing and unknown future limitations on the ability of the Company’s direct and indirect subsidiaries to make their cash flow available to the Company for payments on the Company’s indebtedness or other purposes; global demands for bio-fuels and grain and oilseed commodities, which have exhibited volatility, and can impact the cost of feed for cattle, hogs and poultry, thus affecting available rendering feedstock and selling prices for the Company’s products; reductions in raw material volumes available to the Company due to weak margins in the meat production industry as a result of higher feed costs, reduced consumer demand or other factors, reduced volume from food service establishments, or otherwise; reduced demand for animal feed; reduced finished product prices, including a decline in fat and used cooking oil finished product prices; changes to worldwide government policies relating to renewable fuels and greenhouse gas(«GHG») emissions that adversely affect programs like the U.S. government’s renewable fuel standard, low carbon fuel standards («LCFS») and tax credits for biofuels both in the United States and abroad; possible product recall resulting from developments relating to the discovery of unauthorized adulterations to food or food additives; the occurrence of 2009 H1N1 flu (initially known as «Swine Flu»), Highly pathogenic strains of avian influenza (collectively known as «Bird Flu»), severe acute respiratory syndrome («SARS»), bovine spongiform encephalopathy (or «BSE»), porcine epidemic diarrhea («PED») or other diseases associated with animal origin in the United States or elsewhere, such as the outbreak of African Swine Fever («ASF») in China and elsewhere; the occurrence of pandemics, epidemics or disease outbreaks, such as the current COVID-19 outbreak; unanticipated costs and/or reductions in raw material volumes related to the Company’s compliance with the existing or unforeseen new U.S. or foreign (including, without limitation, China) regulations (including new or modified animal feed, Bird Flu, SARS, PED, BSE, ASF or similar or unanticipated regulations) affecting the industries in which the Company operates or its value added products; risks associated with the DGD Joint Venture, including possible unanticipated operating disruptions and issues relating to the announced expansion projects; risks and uncertainties relating to international sales and operations, including imposition of tariffs, quotas, trade barriers and other trade protections imposed by foreign countries; difficulties or a significant disruption in our information systems or failure to implement new systems and software successfully,  risks relating to possible third party claims of intellectual property infringement; increased contributions to the Company’s pension and benefit plans, including multiemployer and employer-sponsored defined benefit pension plans as required by legislation, regulation or other applicable U.S. or foreign law or resulting from a U.S. mass withdrawal event; bad debt write-offs; loss of or failure to obtain necessary permits and registrations; continued or escalated conflict in the Middle East, North Korea, Ukraine or elsewhere; uncertainty regarding the exit of the U.K. from the European Union; and/or unfavorable export or import markets. These factors, coupled with volatile prices for natural gas and diesel fuel, climate conditions, currency exchange fluctuations, general performance of the U.S. and global economies, disturbances in world financial, credit, commodities and stock markets, and any decline in consumer confidence and discretionary spending, including the inability of consumers and companies to obtain credit due to lack of liquidity in the financial markets, among others, could cause actual results to vary materially from the forward looking statements included in this release or negatively impact the Company’s results of operations. Among other things, future profitability may be affected by the Company’s ability to grow its business, which faces competition from companies that may have substantially greater resources than the Company. The Company’s announced share repurchase program may be suspended or discontinued at any time and purchases of shares under the program are subject to market conditions and other factors, which are likely to change from time to time. Other risks and uncertainties regarding Darling Ingredients Inc., its business and the industries in which it operates are referenced from time to time in the Company’s filings with the Securities and Exchange Commission.  Darling Ingredients Inc. is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.}

For More Information, contact:


Jim Stark, Vice President, Investor Relations

Email : james.stark@darlingii.com    

5601 MacArthur Blvd., Irving, Texas 75038

Phone : 972-281-4823

 

 

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SOURCE Darling Ingredients Inc.