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.