IRVING Texas and SAN ANTONIO, Jan. 28, 2021 /PRNewswire/ -- Darling Ingredients Inc. (NYSE:DAR) ("Darling") & Valero Energy Corporation (NYSE:VLO) ("Valero") –
Darling and Valero jointly announce today that their 50/50 joint venture, Diamond Green Diesel ("DGD"), has received approval from both companies' Boards of Directors to proceed with the construction of the renewable diesel production facility to be located at Valero's Port Arthur, Texas refinery.
DGD Port Arthur's capacity is estimated to be 470 million gallons per year of renewable diesel. This new plant is anticipated to commence operations in the second half of 2023. Once operational, and when combined with the increased capacity at the Norco, LA facility (currently 290 million gallons annually with an anticipated increase of 400 million gallons due to be operational later this year), DGD's total annual production capacity is expected to be approximately 1.2 billion gallons of renewable diesel and 50 million gallons of renewable naphtha. The current estimated construction cost is $1.45 billion to be split equally between the joint venture partners and funded from internal cash flows provided by DGD.
"The Board of Directors of Darling Ingredients is pleased to be moving forward with the construction of DGD at Port Arthur," said Randall C. Stuewe Chairman and Chief Executive Officer of Darling Ingredients. "The project is moving forward immediately and we fully plan to utilize the first mover advantage DGD has in North America as we believe Darling's vertical integration coupled with Valero's refining expertise are key to providing low carbon feedstocks to the DGD renewable diesel platform."
"We expect low-carbon fuel policies to continue to expand globally and drive demand for renewable fuels," said Joe Gorder, Valero Chairman and Chief Executive Officer, "and to that end, we are applying our liquid fuels expertise to continue to expand our long-term competitive advantage in low-carbon transportation fuels with the expansion of DGD."
About Darling
Darling Ingredients Inc. (NYSE: DAR) is one of the world's leading producers of organic ingredients, producing 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. The Company sells its products 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 Green House Gas (GHG) emissions by up to 85% compared to fossil fuels. For additional information, visit the Company's website at http://www.darlingii.com. For more information on Darling's ESG efforts, visit http://www.darlingii.com/csr.
About Valero
Valero Energy Corporation, through its subsidiaries (collectively, "Valero"), is an international manufacturer and marketer of transportation fuels and petrochemical products. Valero is a Fortune 50 company based in San Antonio, Texas, and it operates 15 petroleum refineries with a combined throughput capacity of approximately 3.2 million barrels per day and 13 ethanol plants with a combined production capacity of approximately 1.68 billion gallons per year. The petroleum refineries are located in the United States (U.S.), Canada and the United Kingdom (U.K.), and the ethanol plants are located in the Mid-Continent region of the U.S. Valero also is a joint venture partner in Diamond Green Diesel, which operates a renewable diesel plant in Norco, Louisiana. Diamond Green Diesel is North America's largest biomass-based diesel plant. Valero sells its products in the wholesale rack or bulk markets in the U.S., Canada, the U.K., Ireland and Latin America. Approximately 7,000 outlets carry Valero's brand names. Please visit www.investorvalero.com for more information.
Safe Harbor Statement
Some of the statements made in this press release are forward-looking statements. These forward-looking statements are based upon our current expectations and projections about future events and generally relate to our plans, objectives and expectations for the development of our business. Although management believes that the plans and objectives reflected in or suggested by these forward-looking statements are reasonable, all forward-looking statements involve risks and uncertainties and actual future results may be materially different from the plans, objectives and expectations expressed in this press release.
Darling Contact:
James Stark, Vice President - Investor Relations, 972-281-4823
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SOURCE Diamond Green Diesel
IRVING, Texas, Nov. 2, 2020 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) will hold a conference call and webcast on Wednesday, November 4, 2020 to discuss the Company's third quarter 2020 financial results. The teleconference will begin at 9:00 a.m. ET and will be hosted by Mr. Randall Stuewe, CEO and Chairman of the Board, and Mr. Brad Phillips, EVP and Chief Financial Officer. Additionally, the Company will have a slide presentation available to augment management's formal remarks, which will be accessible via the investor relations section of the Company's website. The related press release will be issued after the market closes on November 3, 2020.
Due to historically high call volume, the company is offering participants the opportunity to register in advance for the conference through the following link: https://dpregister.com/sreg/10149629/dc6cb7deec
Registered participants will receive an email with a calendar reminder and a dial-in number and PIN that will allow them immediate access to the call on November 4, 2020
Participants who do not wish to pre-register for the call may dial in using 844-868-8847 (U.S. callers), or 412-317-6593 (international callers), and ask for the "Darling Ingredients" call. A replay will be available two hours after completion of the call through November 11, 2020. To access the replay, please dial 877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 412-317-0088 (International callers) and reference passcode 10149629. The live webcast and archived replay also can be accessed on the Company's web site at http://ir.darlingii.com.
About Darling
Darling Ingredients Inc. (NYSE: DAR) is one of the world's leading producers of organic ingredients, producing 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. The Company sells its products 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 partner in Diamond Green Diesel (DGD), North America's largest renewable diesel manufacturer, currently producing approximately 275 million gallons of renewable diesel annually which products reduce Green House Gas (GHG) emissions by up to 85% compared to fossil fuels. For additional information, visit the Company's website at http://www.darlingii.com. For more information on Darling's ESG efforts, visit http://www.darlingii.com/csr.
For More Information, contact:
Jim Stark, VP, Investor Relations
James.Stark@darlingii.com
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SOURCE Darling Ingredients Inc.
IRVING, Texas, Oct. 27, 2020 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR), today announced that its Diamond Green Diesel (DGD) joint venture has received the necessary air permit from the Texas Commission on Environmental Quality (TCEQ), making construction one step closer on the proposed renewable diesel plant known as DGD III in Port Arthur, Texas. DGD continues to work through its gated project development process and a final investment decision is expected to be reached in early 2021.
"Our timeline to construct an additional 400 million gallons of renewable diesel production in Port Arthur, Texas is on schedule," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients. "DGD is in the process of finalizing Phase III engineering plans and cost estimates to build another state of the art facility. We anticipate that both joint venture partners' Board of Directors will be in a position to approve moving forward with the project in early 2021. As we meet this investment decision timeframe, we believe that DGD III would be operational in 2024."
"Darling's vertically integrated supply chain provides DGD with superior low cost feedstocks, and when combined with the refining expertise of our joint venture partner, supports DGD's position as the lowest cost producer of renewable fuels in North America," Stuewe added.
The current DGD II 400 million gallon plant expansion is still expected to be completed in 2021, bringing the total capacity of DGD to 675 million gallons of renewable diesel production, while also adding 60 million gallons of renewable naphtha production to the platform. With the potential approval of DGD III, Darling's joint venture will have renewable diesel production capacity of 1.1 billion gallons and 100 million gallons of renewable naphtha production capacity annually. Darling continues to lead the world in decarbonization with our stated goals of reducing energy and water consumption over the coming years and the significant reduction in carbon emissions in transport fuels from the usage of renewable diesel produced by DGD across North America and the World.
About Darling
Darling Ingredients Inc. (NYSE: DAR) is one of the world's leading producers of organic ingredients, producing 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. The Company sells its products 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 partner in Diamond Green Diesel (DGD), North America's largest renewable diesel manufacturer, producing 275 million gallons of renewable diesel annually which products reduce Green House Gas (GHG) emissions by up to 85% compared to fossil fuels. For additional information, visit the Company's website at http://www.darlingii.com. For more information on Darling's ESG efforts, visit http://www.darlingii.com/csr.
Safe Harbor Statement
Some of the statements made in this press release are forward-looking statements. These forward-looking statements are based upon our current expectations and projections about future events and generally relate to our plans, objectives and expectations for the development of our business. Although management believes that the plans and objectives reflected in or suggested by these forward-looking statements are reasonable, all forward-looking statements involve risks and uncertainties and actual future results may be materially different from the plans, objectives and expectations expressed in this press release.
For more information contact: | |
Investors | Media |
Jim Stark | Melissa Gaither |
VP, Investor Relations | VP, Global Communications & Sustainability |
+1 (972) 281-4823 | +1 (972) 281-4478 |
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SOURCE Darling Ingredients Inc.
IRVING, Texas, Aug. 5, 2020 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR, "Darling") --
Second Quarter 2020
Darling reported net sales of $848.7 million for the second quarter of 2020, as compared with net sales of $827.3 million for the same period a year ago. Net income attributable to Darling for the three months ended June 27, 2020 was $65.4 million, or $0.39 per diluted share, compared to a net income of $26.3 million, or $0.16 per diluted share, for the second quarter of 2019.
"We had another solid quarter of execution from our employees worldwide who delivered a strong second quarter financial performance, generating $195 million of combined adjusted EBITDA," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "Our core business navigated through a turbulent second quarter with our feed segment posting its best quarterly EBITDA of $85.2 million in over the last three years. We did benefit from over 40 million pounds of depopulated hog volumes through our processing locations during the quarter."
"Darling's diversification provides our global business platform earnings sustainability as demonstrated in the second quarter. Our DGD JV financial performance was impacted by the sharp decline in the energy sector as a result of the COVID pandemic, but still produced good results which were enhanced by a better performance in our feed segment. Excluding the gain on the sale of assets in the food segment from a year ago, this year's food segment performance was on par to 2019," added Stuewe.
"We did use the DGD distribution proceeds received in April to pay down our outstanding debt in the second quarter, lowering our leverage ratio to 2.39 as measured by our bank covenant. We remain diligent on our capital expenditures, investing approximately $123 million for the first six months of 2020. We continue to target a deferral of 15% to 20% in capital expenditures as the uncertainty surrounding COVID-19 persists," commented Stuewe.
The Darling Ingredients Board has approved replenishing the Company's previously announced share repurchase program back to $200 million of availability and have extended the term of the program for an additional two years to August 13, 2022, to be exercised depending on market conditions. The repurchases may be made from time to time on the open market at prevailing market prices or in negotiated transactions off the market. Repurchases may occur over the authorized period unless extended or shortened by the Board of Directors.
In accordance with the distribution policy at Diamond Green Diesel, Darling received an $80 million distribution from DGD in July 2020. Total distributions received in the first six months of 2020 total $205 million.
For the six months ended June 27, 2020, Darling reported net sales of $1.7 billion, as compared with net sales of $1.7 billion for the same period of 2019. Net Income attributable to Darling for the first six months of 2020 was $150.9 million, or $0.90 per diluted share, as compared to a net income of $44.3 million, or $0.26 per diluted share, for the first six months of 2019.
As of June 27, 2020, Darling had $76.2 million in cash and cash equivalents, and $939.7 million available under committed revolving credit agreements. Total debt outstanding at the end of the second quarter of 2020 was $1.6 billion.
Combined adjusted EBITDA was $195.2 million for the second quarter of 2020, compared to $159.4 million for the same period in 2019. On a year-to-date basis, combined adjusted EBITDA totaled $408.5 million for 2020, compared to $292.7 million on a year-to-date basis for 2019.
Segment Financial Tables (in thousands) | |||||
Three Months Ended June 27, 2020 | Feed | Food | Fuel | 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 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 |
Three Months Ended June 29, 2019 | Feed | Food | Fuel | Corporate | Total |
Net Sales | $ 487,447 | $ 274,835 | $ 65,042 | $ - | $ 827,324 |
Cost of sales and operating expenses | 376,955 | 214,444 | 53,317 | - | 644,716 |
Gross Margin | $ 110,492 | $ 60,391 | $ 11,725 | $ - | $ 182,608 |
Gain on sale of assets | (524) | (13,379) | (23) | - | (13,926) |
Selling, general and administrative expenses | 46,465 | 23,431 | 425 | 10,696 | 81,017 |
Depreciation and amortization | 48,720 | 19,861 | 8,362 | 2,543 | 79,486 |
Equity in net income of Diamond Green Diesel | - | - | 38,093 | - | 38,093 |
Segment operating income/(loss) | $ 15,831 | $ 30,478 | $ 41,054 | $ (13,239) | $ 74,124 |
Equity in net income of unconsolidated subsidiaries | $ 82 | $ - | $ - | $ - | $ 82 |
Segment income/(loss) | $ 15,913 | $ 30,478 | $ 41,054 | $ (13,239) | $ 74,206 |
Segment EBITDA | $ 64,551 | $ 50,339 | $ 11,323 | $ (10,696) | $ 115,517 |
DGD adjusted EBITDA (Darling's Share) | $ - | $ - | $ 43,894 | $ - | $ 43,894 |
Combined adjusted EBITDA | $ 64,551 | $ 50,339 | $ 55,217 | $ (10,696) | $ 159,411 |
Segment Financial Tables (in thousands) continued | |||||
Six Months Ended June 27, 2020 | Feed | Food | Fuel | 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 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 |
Six Months Ended June 29, 2019 | Feed | Food | Fuel | Corporate | Total |
Net Sales | $ 983,266 | $ 553,999 | $ 125,163 | $ - | $ 1,662,428 |
Cost of sales and operating expenses | 763,814 | 428,448 | 103,367 | - | 1,295,629 |
Gross Margin | $ 219,452 | $ 125,551 | $ 21,796 | $ - | $ 366,799 |
Loss/(gain) on sale of assets | (4,914) | (13,265) | 3 | - | (18,176) |
Selling, general and administrative expenses | 95,296 | 45,318 | (329) | 25,735 | 166,020 |
Depreciation and amortization | 98,089 | 39,372 | 16,160 | 5,029 | 158,650 |
Equity in net income of Diamond Green Diesel | - | - | 62,370 | - | 62,370 |
Segment operating income/(loss) | $ 30,981 | $ 54,126 | $ 68,332 | $ (30,764) | $ 122,675 |
Equity in net loss of unconsolidated subsidiaries | $ (422) | $ - | $ - | $ - | $ (422) |
Segment income/(loss) | $ 30,559 | $ 54,126 | $ 68,332 | $ (30,764) | $ 122,253 |
Segment EBITDA | $ 129,070 | $ 93,498 | $ 22,122 | $ (25,735) | $ 218,955 |
DGD adjusted EBITDA (Darling's Share) | $ - | $ - | $ 73,721 | $ - | 73,721 |
Combined adjusted EBITDA | $ 129,070 | $ 93,498 | $ 95,843 | $ (25,735) | $ 292,676 |
Darling Ingredients Inc. and Subsidiaries | ||||
Condensed Consolidated Balance Sheets | ||||
June 27, 2020 and December 28, 2019 | ||||
(in thousands) | ||||
June 27, | December 28, | |||
2020 | 2019 | |||
ASSETS | (unaudited) | |||
Current assets: | ||||
Cash and cash equivalents | $ 76,185 | $ 72,935 | ||
Restricted cash | 103 | 110 | ||
Accounts receivable, net | 375,908 | 406,338 | ||
Inventories | 394,708 | 362,957 | ||
Prepaid expenses | 46,003 | 46,599 | ||
Income taxes refundable | 3,752 | 3,317 | ||
Other current assets | 34,392 | 25,032 | ||
Total current assets | 931,051 | 917,288 | ||
Property, plant and equipment, net | 1,773,329 | 1,802,411 | ||
Intangible assets, net | 485,148 | 526,394 | ||
Goodwill | 1,217,177 | 1,223,291 | ||
Investment in unconsolidated subsidiaries | 729,094 | 689,354 | ||
Operating lease right-of-use assets | 134,901 | 124,726 | ||
Other assets | 41,651 | 47,400 | ||
Deferred income taxes | 14,803 | 14,394 | ||
$ 5,327,154 | $ 5,345,258 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Current portion of long-term debt | $ 42,758 | $ 90,996 | ||
Accounts payable, principally trade | 197,528 | 239,252 | ||
Income taxes payable | 16,474 | 8,895 | ||
Current operating lease liabilities | 39,532 | 37,805 | ||
Accrued expenses | 310,004 | 311,391 | ||
Total current liabilities | 606,296 | 688,339 | ||
Long-term debt, net of current portion | 1,553,118 | 1,558,429 | ||
Long-term operating lease liabilities | 99,482 | 91,424 | ||
Other noncurrent liabilities | 109,046 | 115,785 | ||
Deferred income taxes | 260,858 | 247,931 | ||
Total liabilities | 2,628,800 | 2,701,908 | ||
Commitments and contingencies | ||||
Total Darling's stockholders' equity | 2,633,360 | 2,565,819 | ||
Noncontrolling interests | 64,994 | 77,531 | ||
Total stockholders' equity | $ 2,698,354 | $ 2,643,350 | ||
$ 5,327,154 | $ 5,345,258 |
Darling Ingredients Inc. and Subsidiaries | ||||||||||||||
Consolidated Operating Results | ||||||||||||||
For the Three-Month and Six-Month Periods Ended June 27, 2020 and June 29, 2019 | ||||||||||||||
(in thousands, except per share data) | ||||||||||||||
(unaudited) | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
$ Change | $ Change | |||||||||||||
June 27, | June 29, | Favorable | June 27, | June 29, | Favorable | |||||||||
2020 | 2019 | (Unfavorable) | 2020 | 2019 | (Unfavorable) | |||||||||
Net sales | $ 848,673 | $ 827,324 | $ 21,349 | $ 1,701,515 | $ 1,662,428 | $ 39,087 | ||||||||
Costs and expenses: | ||||||||||||||
Cost of sales and operating expenses | 632,347 | 644,716 | 12,369 | 1,279,255 | 1,295,629 | 16,374 | ||||||||
Loss (gain) on sale of assets | 27 | (13,926) | (13,953) | 88 | (18,176) | (18,264) | ||||||||
Selling, general and administrative expenses | 90,193 | 81,017 | (9,176) | 186,386 | 166,020 | (20,366) | ||||||||
Depreciation and amortization | 83,310 | 79,486 | (3,824) | 167,981 | 158,650 | (9,331) | ||||||||
Total costs and expenses | 805,877 | 791,293 | (14,584) | 1,633,710 | 1,602,123 | (31,587) | ||||||||
Equity in net income of Diamond Green Diesel | 63,492 | 38,093 | 25,399 | 161,312 | 62,370 | 98,942 | ||||||||
Operating income | 106,288 | 74,124 | 32,164 | 229,117 | 122,675 | 106,442 | ||||||||
Other expense: | ||||||||||||||
Interest expense | (17,920) | (20,853) | 2,933 | (37,010) | (40,729) | 3,719 | ||||||||
Debt extinguishment costs | - | (12,126) | 12,126 | - | (12,126) | 12,126 | ||||||||
Foreign currency gain/(loss) | (1,134) | (388) | (746) | 530 | (1,120) | 1,650 | ||||||||
Other income (expense), net | (1,485) | (2,019) | 534 | (3,366) | (4,544) | 1,178 | ||||||||
Total other expense | (20,539) | (35,386) | 14,847 | (39,846) | (58,519) | 18,673 | ||||||||
Equity in net income/(loss) | ||||||||||||||
of unconsolidated subsidiaries | 692 | 82 | 610 | 1,561 | (422) | 1,983 | ||||||||
Income before income taxes | 86,441 | 38,820 | 47,621 | 190,832 | 63,734 | 127,098 | ||||||||
Income tax expense | 19,946 | 7,776 | (12,170) | 38,246 | 13,050 | (25,196) | ||||||||
Net income | 66,495 | 31,044 | 35,451 | 152,586 | 50,684 | 101,902 | ||||||||
Net income attributable to | ||||||||||||||
noncontrolling interests | (1,056) | (4,786) | 3,730 | (1,637) | (6,414) | 4,777 | ||||||||
Net income attributable to Darling | $ 65,439 | $ 26,258 | $ 39,181 | $ 150,949 | $ 44,270 | $ 106,679 | ||||||||
Basic income per share: | $ 0.40 | $ 0.16 | $ 0.24 | $ 0.93 | $ 0.27 | $ 0.66 | ||||||||
Diluted income per share: | $ 0.39 | $ 0.16 | $ 0.23 | $ 0.90 | $ 0.26 | $ 0.64 | ||||||||
Number of diluted common shares: | 165,999 | 168,432 | 166,963 | 168,546 |
Darling Ingredients Inc. and Subsidiaries | ||||||
Consolidated Statement of Cash Flows | ||||||
Periods Ended June 27, 2020 and June 29, 2019 | ||||||
(in thousands) | ||||||
(unaudited) | ||||||
Six Months Ended | ||||||
June 27, | June 29, | |||||
Cash flows from operating activities: | 2020 | 2019 | ||||
Net income | $ 152,586 | $ 50,684 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||
Depreciation and amortization | 167,981 | 158,650 | ||||
Loss/(gain) on disposal of property, plant, equipment and other assets | 88 | (18,176) | ||||
Gain on insurance proceeds from insurance settlement | - | (845) | ||||
Deferred taxes | 13,998 | (3,137) | ||||
Increase (decrease) in long-term pension liability | (890) | 1,010 | ||||
Stock-based compensation expense | 15,566 | 14,182 | ||||
Write-off deferred loan costs | - | 4,547 | ||||
Deferred loan cost amortization | 2,835 | 3,010 | ||||
Equity in net income of Diamond Green Diesel and other unconsolidated subsidiaries | (162,873) | (61,948) | ||||
Distributions of earnings from Diamond Green Diesel and other unconsolidated subsidiaries | 125,891 | 17,755 | ||||
Changes in operating assets and liabilities, net of effects from acquisitions: | ||||||
Accounts receivable | 26,077 | 27,218 | ||||
Income taxes refundable/payable | 6,119 | 7,140 | ||||
Inventories and prepaid expenses | (35,413) | (17,374) | ||||
Accounts payable and accrued expenses | (33,375) | (29,849) | ||||
Other | (14,941) | 1,437 | ||||
Net cash provided by operating activities | 263,649 | 154,304 | ||||
Cash flows from investing activities: | ||||||
Capital expenditures | (123,204) | (167,871) | ||||
Acquisitions, net of cash acquired | - | (1,431) | ||||
Investment in unconsolidated subsidiary | - | (1,000) | ||||
Gross proceeds from disposal of property, plant and equipment and other assets | 1,053 | 9,814 | ||||
Proceeds from insurance settlement | - | 845 | ||||
Payments related to routes and other intangibles | (3,712) | (3,150) | ||||
Net cash used by investing activities | (125,863) | (162,793) | ||||
Cash flows from financing activities: | ||||||
Proceeds from long-term debt | 16,164 | 507,722 | ||||
Payments on long-term debt | (18,239) | (526,230) | ||||
Borrowings from revolving credit facility | 375,971 | 273,485 | ||||
Payments on revolving credit facility | (405,800) | (266,884) | ||||
Net cash overdraft financing | (26,461) | 11,178 | ||||
Deferred loan costs | - | (7,003) | ||||
Issuance of common stock | 67 | 12 | ||||
Repurchase of common stock | (55,044) | - | ||||
Minimum withholding taxes paid on stock awards | (4,863) | (3,193) | ||||
Acquisition of noncontrolling interest | (8,784) | - | ||||
Distributions to noncontrolling interests | (987) | - | ||||
Net cash used by financing activities | (127,976) | (10,913) | ||||
Effect of exchange rate changes on cash flows | (6,567) | (853) | ||||
Net increase/(decrease) in cash, cash equivalents and restricted cash | 3,243 | (20,255) | ||||
Cash, cash equivalents and restricted cash at beginning of year | 73,045 | 107,369 | ||||
Cash, cash equivalents and restricted cash at end of period | $ 76,288 | $ 87,114 | ||||
Supplemental disclosure of cash flow information: | ||||||
Accrued capital expenditures | $ 23 | $ (7,542) | ||||
Cash paid during the period for: | ||||||
Interest, net of capitalized interest | $ 35,070 | $ 45,196 | ||||
Income taxes, net of refunds | $ 18,030 | $ 12,607 | ||||
Non-cash operating activities: | ||||||
Operating lease right of use obtained in exchange for new lease liabilities | $ 28,801 | $ 7,492 | ||||
Non-cash financing activities: | ||||||
Debt issued for service contract assets | $ 21 | $ - |
Diamond Green Diesel Joint Venture | ||||||
Condensed Consolidated Balance Sheets | ||||||
June 30, 2020 and December 31, 2019 | ||||||
(in thousands) | ||||||
June 30, | December 31, | |||||
2020 | 2019 | |||||
Assets: | (unaudited) | |||||
Total current assets | $ 581,334 | $ 668,026 | ||||
Property, plant and equipment, net | 894,415 | 713,489 | ||||
Other assets | 27,959 | 30,710 | ||||
Total assets | $ 1,503,708 | $ 1,412,225 | ||||
Liabilities and members' equity: | ||||||
Total current portion of long term debt | $ 495 | $ 341 | ||||
Total other current liabilities | 89,533 | 75,802 | ||||
Total long term debt | 8,969 | 8,742 | ||||
Total other long term liabilities | 4,023 | 4,422 | ||||
Total members' equity | 1,400,688 | 1,322,918 | ||||
Total liabilities and members' equity | $ 1,503,708 | $ 1,412,225 |
Diamond Green Diesel Joint Venture | ||||||||||||||
Operating Financial Results | ||||||||||||||
For the Three-Month and Six-Month Periods Ended June 30, 2020 and June 30, 2019 | ||||||||||||||
(in thousands) | ||||||||||||||
(unaudited) | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
$ Change | $ Change | |||||||||||||
June 30, | June 30, | Favorable | June 30, | June 30, | Favorable | |||||||||
Revenues: | 2020 | 2019 | (Unfavorable) | 2020 | 2019 | (Unfavorable) | ||||||||
Operating revenues | $ 295,826 | $ 294,811 | $ 1,015 | $ 654,441 | $ 597,529 | $ 56,912 | ||||||||
Expenses: | ||||||||||||||
Total costs and expenses less | ||||||||||||||
depreciation, amortization and accretion expense | 157,611 | 207,024 | 49,413 | 308,958 | 450,087 | 141,129 | ||||||||
Depreciation, amortization and | 11,114 | 11,914 | 800 | 22,888 | 23,332 | 444 | ||||||||
accretion expense | ||||||||||||||
Total costs and expenses | 168,725 | 218,938 | 50,213 | 331,846 | 473,419 | 141,573 | ||||||||
Operating income | 127,101 | 75,873 | 51,228 | 322,595 | 124,110 | 198,485 | ||||||||
Other income | 200 | 634 | (434) | 661 | 1,275 | (614) | ||||||||
Interest and debt expense, net | (317) | (321) | 4 | (632) | (645) | 13 | ||||||||
Net income | $ 126,984 | $ 76,186 | $ 50,798 | $ 322,624 | $ 124,740 | $ 197,884 |
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 June 27, 2020 and June 29, 2019 | |||||||||
Three Months Ended | Six Months Ended | ||||||||
Adjusted EBITDA | June 27, | June 29, | June 27, | June 29, | |||||
(U.S. dollars in thousands) | 2020 | 2019 | 2020 | 2019 | |||||
Net income attributable to Darling | $ 65,439 | $ 26,258 | $ 150,949 | $ 44,270 | |||||
Depreciation and amortization | 83,310 | 79,486 | 167,981 | 158,650 | |||||
Interest expense | 17,920 | 20,853 | 37,010 | 40,729 | |||||
Income tax expense | 19,946 | 7,776 | 38,246 | 13,050 | |||||
Foreign currency loss/(gain) | 1,134 | 388 | (530) | 1,120 | |||||
Other expense, net | 1,485 | 2,019 | 3,366 | 4,544 | |||||
Debt extinguishment costs | - | 12,126 | - | 12,126 | |||||
Equity in net (income) of Diamond Green Diesel | (63,492) | (38,093) | (161,312) | (62,370) | |||||
Equity in net (income)/loss of unconsolidated subsidiaries | (692) | (82) | (1,561) | 422 | |||||
Net income attributable to noncontrolling interests | 1,056 | 4,786 | 1,637 | 6,414 | |||||
Adjusted EBITDA (Non-GAAP) | $ 126,106 | $ 115,517 | $ 235,786 | $ 218,955 | |||||
Foreign currency exchange impact | 1,951 | (1) | - | 4,109 | (2) | - | |||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) | $ 128,057 | $ 115,517 | $ 239,895 | $ 218,955 | |||||
DGD Joint Venture Adjusted EBITDA (Darling's Share) | $ 69,108 | $ 43,894 | $ 172,742 | $ 73,721 | |||||
Darling plus Darling's share of DGD Joint Venture Adjusted EBITDA | $ 195,214 | $ 159,411 | $ 408,528 | $ 292,676 | |||||
(1) The average rate assumption used in this calculation was the actual fiscal average rate for the three months ended June 27, 2020 of €1.00:USD$1.10 and CAD$1.00:USD$0.72, as compared to the average rate for the three months ended June 29, 2019 of €1.00:USD$1.12 and CAD$1.00:USD$0.75, respectively. | |||||||||
(2) The average rate assumption used in this calculation was the actual fiscal average rate for the six months ended June 27, 2020 of €1.00:USD$1.10 and CAD$1.00:USD$0.73, as compared to the average rate for the six months ended June 29, 2019 of €1.00:USD$1.13 and CAD$1.00:USD$0.75, respectively. |
For the three and six months ended June 29, 2019, Adjusted EBITDA included a gain on the sale of assets of approximately $13.1 million.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as collagen, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. 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 2020 financial results at 9:00 am Eastern Time (8:00 am Central Time) on Thursday, August 6, 2020. 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 10146331. 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 13, 2020, 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 10146331. 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 expenses, 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.
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 and 5.25% Notes and 3.625% Notes that were outstanding at June 27, 2020. 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 and 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.
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," 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 project; 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.
IRVING, Texas, July 20, 2020 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR), today announced that its Rousselot business, the global leader of collagen-based solutions, has successfully introduced X-Pure® GelMA at Bio Digital 2020. The first Good Manufacturing Practice (GMP)-ready range of gelatin methacryloyl (GelMA) biomaterials suitable for preclinical and clinical applications. X-Pure® GelMA is part of the X-Pure® portfolio of ultra-pure gelatins and collagens, suitable for use as biomaterials in 3D bioprinting, tissue engineering, and regenerative medicine.
In GelMA hydrogels, the most versatile biological environment for cells, the inherent bioactivity, biodegradability, and cell compatibility of gelatin are combined with the ability to tailor photo-crosslinking. This combination holds a huge potential for the creation of tunable biological environments for the culture of various eukaryotic cells at body temperature. Uses for this biomedical technology could be bio-adhesives for patching arteries, transdermal needles for drug delivery or act as a matrix for bone regeneration.
X-Pure® GelMA - The first GMP-ready gelatin methacryloyl. GelMA-oriented patent applications have been growing exponentially over the last five years, with many of these research concepts now being translated into the clinic. However, standard GelMA products often carry high and variable levels of soluble impurities originating from either the gelatin raw material or the chemical synthesis process. The presence of these impurities such as endotoxins, pyrogens and/or methacrylic acid residues are detrimental for in-body use but can also affect the success of in vitro applications. X-Pure® GelMA provides an ultra-pure solution.
"We are pleased that our Rousselot development team has delivered on this exciting new product for the biomedical marketplace," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients. "Rousselot continues to be a global leader of collagen-based solutions for food, biomedical and pharmaceutical sectors."
Rousselot's unique patented two-stage purification process results in ultra-low levels of pyrogens and residual methacrylic acid, providing an excellent safety profile to the product. Further, consistent batch-to-batch quality ensures reliable results and shorter lead times to the clinic.
"Our X-Pure® products are unique on the market, as they come with ultra-low levels of endotoxins and fully validated traceability of raw materials," stated Jos Vervoort, Executive Vice President of Rousselot. "X-Pure® GelMA is our latest addition to our biomedical range of ultra-pure gelatins and collagens and our range will be further extended as we move forward with products bringing added value to the whole biomedical industry."
Readily available, X-Pure® GelMA can be produced in compliance with GMP regulatory requirements for quality, raw material sourcing, and documentation for approval across all major regulators worldwide, thereby minimizing regulatory risks and optimizing the pace of product development. The new range covers a broad choice of molecular weights and modification degrees of gelatin methacryloyl biomaterials, allowing close customer collaboration for custom-made solutions.
Contact Darling Ingredients' Rousselot business to speak to an expert on how X-Pure® GelMA will impact the medical community and further meet the needs of an aging population at www.rousselot.com/biomedical.
To watch more on the benefits of X-Pure® GelMA:
https://youtu.be/jBnH4FUffYQ
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
Safe Harbor Statement
Some of the statements made in this press release are forward-looking statements. These forward-looking statements are based upon our current expectations and projections about future events and generally relate to our plans, objectives and expectations for the development of our business. Although management believes that the plans and objectives reflected in or suggested by these forward-looking statements are reasonable, all forward-looking statements involve risks and uncertainties and actual future results may be materially different from the plans, objectives and expectations expressed in this press release.
For more information contact: | |
Investors | Media |
Jim Stark | Melissa Gaither |
VP, Investor Relations | VP, Global Communications & Sustainability |
+1 (972) 281-4823 | +1 (972) 281-4478 |
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SOURCE Darling Ingredients Inc.
IRVING, Texas, May 6, 2020 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR, "Darling") --
First Quarter 2020
Darling reported net sales of $852.8 million for the first quarter of 2020, as compared with net sales of $835.1 million for the same period a year ago. Net income attributable to Darling for the three months ended March 28, 2020 was $85.5 million, or $0.51 per diluted share, compared to a net income of $18.0 million, or $0.11 per diluted share, for the first quarter of 2019.
"We delivered a strong first quarter performance consistent with the guidance we provided on our February 2020 earnings call, generating $213 million of combined adjusted EBITDA," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "The diversity of our global platform from food to feed to green hydrocarbon is helping us to weather the COVID-19 pandemic."
"We continue to execute our global strategy of creating sustainable ingredients for feed, food and fuel, from the waste streams of the food processing industry and being a leader in the production of green hydrocarbons to assist with global decarbonization. First and foremost, Darling has acted to ensure that we are providing a safe work environment for our employees across our network of 200+ locations around the world," added Stuewe. "We are also taking the necessary steps to safeguard our balance sheet in the current environment. While we anticipate some disruption and potential lighter volumes of raw materials processed in the coming quarter, accordingly, we are committed to managing and reducing operating expenses across the business. Consistent with this approach, we are targeting a deferral of 15% to 20% in capital expenditures until the uncertainty surrounding the COVID-19 outbreak improves."
"In April, DGD had accumulated over $600 million of cash, sufficient to fund the phase II 2020 expansion of DGD and provide each joint venture partner with a $125 million distribution. Also, Darling anticipates receiving an additional $65 to $75 million in July consistent with the distribution policy at DGD," stated Stuewe.
As of March 28, 2020, Darling had $76.4 million in cash and cash equivalents, and $795.9 million available under committed revolving credit agreements. Total debt outstanding at the end of the first quarter of 2020 was $1.75 billion.
Under Darling's current share repurchase authorization, the Company repurchased 2.2 million shares of common stock during the first quarter for a total of $55 million. Darling has approximately $126 million remaining under its current authorization.
Combined adjusted EBITDA was $213.3 million for the first quarter of 2020, compared to $133.3 million for the same period in 2019.
Segment Financial Tables (in thousands) | |||||
Three Months Ended March 28, 2020 | Feed Ingredients | Food Ingredients | Fuel Ingredients | Corporate | Total |
Net Sales | $ 512,625 | $ 270,294 | $ 69,923 | $ - | $ 852,842 |
Cost of sales and operating expenses | 388,453 | 205,430 | 53,025 | - | 646,908 |
Gross Margin | $ 124,172 | $ 64,864 | $ 16,898 | $ - | $ 205,934 |
Loss on sale of assets | 50 | 2 | 9 | - | 61 |
Selling, general and administrative expenses | 53,947 | 25,476 | 1,654 | 15,116 | 96,193 |
Depreciation and amortization | 53,521 | 20,305 | 8,092 | 2,753 | 84,671 |
Equity in net income of Diamond Green Diesel | - | - | 97,820 | - | 97,820 |
Segment operating income/(loss) | $ 16,654 | $ 19,081 | $ 104,963 | $ (17,869) | $ 122,829 |
Equity in net income of unconsolidated subsidiaries | $ 869 | $ - | $ - | $ - | $ 869 |
Segment Income/(loss) | $ 17,523 | $ 19,081 | $ 104,963 | $ (17,869) | $ 123,698 |
Segment EBITDA | $ 70,175 | $ 39,386 | $ 15,235 | $ (15,116) | $ 109,680 |
DGD Adjusted EBITDA (Darling's Share) | $ - | $ - | $ 103,634 | $ - | $ 103,634 |
Adjusted EBITDA | $ 70,175 | $ 39,386 | $ 118,869 | $ (15,116) | $ 213,314 |
Three Months Ended March 30, 2019 | Feed Ingredients | Food Ingredients | Fuel Ingredients | Corporate | Total |
Net Sales | $ 495,819 | $ 279,164 | $ 60,121 | $ - | $ 835,104 |
Cost of sales and operating expenses | 386,859 | 214,004 | 50,050 | - | 650,913 |
Gross Margin | $ 108,960 | $ 65,160 | $ 10,071 | $ - | $ 184,191 |
Loss/(gain) on sale of assets | (4,391) | 114 | 27 | - | (4,250) |
Selling, general and administrative expenses | 48,831 | 21,887 | (754) | 15,039 | 85,003 |
Depreciation and amortization | 49,369 | 19,511 | 7,798 | 2,486 | 79,164 |
Equity in net income of Diamond Green Diesel | - | - | 24,277 | - | 24,277 |
Segment operating income/(loss) | $ 15,151 | $ 23,648 | $ 27,277 | $ (17,525) | $ 48,551 |
Equity in net loss of unconsolidated subsidiaries | $ (504) | $ - | $ - | $ - | $ (504) |
Segment income/(loss) | $ 14,647 | $ 23,648 | $ 27,277 | $ (17,525) | $ 48,047 |
Segment EBITDA | $ 64,520 | $ 43,159 | $ 10,798 | $ (15,039) | $ 103,438 |
DGD Adjusted EBITDA (Darling's Share) | $ - | $ - | $ 29,828 | $ - | $ 29,828 |
Adjusted EBITDA | $ 64,520 | $ 43,159 | $ 40,626 | $ (15,039) | $ 133,266 |
Darling Ingredients Inc. and Subsidiaries | ||||
March 28, | December 28, | |||
2020 | 2019 | |||
ASSETS | (unaudited) | |||
Current assets: | ||||
Cash and cash equivalents | $ 76,339 | $ 72,935 | ||
Restricted cash | 106 | 110 | ||
Accounts receivable, net | 397,700 | 406,338 | ||
Inventories | 381,432 | 362,957 | ||
Prepaid expenses | 45,107 | 46,599 | ||
Income taxes refundable | 3,106 | 3,317 | ||
Other current assets | 26,270 | 25,032 | ||
Total current assets | 930,060 | 917,288 | ||
Property, plant and equipment, net | 1,764,120 | 1,802,411 | ||
Intangible assets, net | 497,779 | 526,394 | ||
Goodwill | 1,202,592 | 1,223,291 | ||
Investment in unconsolidated subsidiaries | 802,184 | 689,354 | ||
Operating lease right-of-use assets | 123,859 | 124,726 | ||
Other assets | 42,653 | 47,400 | ||
Deferred income taxes | 14,532 | 14,394 | ||
$ 5,377,779 | $ 5,345,258 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Current portion of long-term debt | $ 86,397 | $ 90,996 | ||
Accounts payable, principally trade | 211,596 | 239,252 | ||
Income taxes payable | 8,593 | 8,895 | ||
Current operating lease liabilities | 37,472 | 37,805 | ||
Accrued expenses | 307,688 | 311,391 | ||
Total current liabilities | 651,746 | 688,339 | ||
Long-term debt, net of current portion | 1,664,858 | 1,558,429 | ||
Long-term operating lease liabilities | 91,250 | 91,424 | ||
Other noncurrent liabilities | 111,145 | 115,785 | ||
Deferred income taxes | 250,338 | 247,931 | ||
Total liabilities | 2,769,337 | 2,701,908 | ||
Commitments and contingencies | ||||
Total Darling's stockholders' equity | 2,543,565 | 2,565,819 | ||
Noncontrolling interests | 64,877 | 77,531 | ||
Total stockholders' equity | $ 2,608,442 | $ 2,643,350 | ||
$ 5,377,779 | $ 5,345,258 |
Darling Ingredients Inc. and Subsidiaries | ||||||
(First Quarter Unaudited) | ||||||
Three Months Ended | ||||||
$ Change | ||||||
March 28, | March 30, | Favorable | ||||
2020 | 2019 | (Unfavorable) | ||||
Net sales | $ 852,842 | $ 835,104 | $ 17,738 | |||
Costs and expenses: | ||||||
Cost of sales and operating expenses | 646,908 | 650,913 | 4,005 | |||
Loss (gain) on sale of assets | 61 | (4,250) | (4,311) | |||
Selling, general and administrative expenses | 96,193 | 85,003 | (11,190) | |||
Depreciation and amortization | 84,671 | 79,164 | (5,507) | |||
Total costs and expenses | 827,833 | 810,830 | (17,003) | |||
Equity in net income of Diamond Green Diesel | 97,820 | 24,277 | 73,543 | |||
Operating income | 122,829 | 48,551 | 74,278 | |||
Other expense: | ||||||
Interest expense | (19,090) | (19,876) | 786 | |||
Foreign currency gain/(loss) | 1,664 | (732) | 2,396 | |||
Other income (expense), net | (1,881) | (2,525) | 644 | |||
Total other expense | (19,307) | (23,133) | 3,826 | |||
Equity in net income/(loss) | ||||||
of unconsolidated subsidiaries | 869 | (504) | 1,373 | |||
Income before income taxes | 104,391 | 24,914 | 79,477 | |||
Income tax expense | 18,300 | 5,274 | (13,026) | |||
Net income | 86,091 | 19,640 | 66,451 | |||
Net income attributable to | ||||||
noncontrolling interests | (581) | (1,628) | 1,047 | |||
Net income attributable to Darling | $ 85,510 | $ 18,012 | $ 67,498 | |||
Basic income per share: | $ 0.52 | $ 0.11 | $ 0.41 | |||
Diluted income per share: | $ 0.51 | $ 0.11 | $ 0.40 | |||
Number of diluted common shares: | 167,927 | 168,660 |
Darling Ingredients Inc. and Subsidiaries | ||||||
Three Months Ended | ||||||
March 28, | March 30, | |||||
Cash flows from operating activities: | 2020 | 2019 | ||||
Net income | $ 86,091 | $ 19,640 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||
Depreciation and amortization | 84,671 | 79,164 | ||||
Loss/(gain) on disposal of property, plant, equipment and other assets | 61 | (4,250) | ||||
Gain on insurance proceeds from insurance settlement | - | (845) | ||||
Deferred taxes | 6,377 | (2,901) | ||||
Increase (decrease) in long-term pension liability | (264) | 646 | ||||
Stock-based compensation expense | 10,818 | 10,327 | ||||
Write-off deferred loan costs | - | 27 | ||||
Deferred loan cost amortization | 1,416 | 1,574 | ||||
Equity in net income of Diamond Green Diesel and other unconsolidated subsidiaries | (98,689) | (23,773) | ||||
Changes in operating assets and liabilities, net of effects from acquisitions: | ||||||
Accounts receivable | 487 | 11,692 | ||||
Income taxes refundable/payable | 348 | 7,270 | ||||
Inventories and prepaid expenses | (24,999) | (5,063) | ||||
Accounts payable and accrued expenses | (16,790) | (43,016) | ||||
Other | (14,981) | (1,891) | ||||
Net cash provided by operating activities | 34,546 | 48,601 | ||||
Cash flows from investing activities: | ||||||
Capital expenditures | (61,599) | (84,269) | ||||
Acquisitions, net of cash acquired | - | (1,431) | ||||
Gross proceeds from disposal of property, plant and equipment and other assets | 379 | 7,868 | ||||
Proceeds from insurance settlement | - | 845 | ||||
Payments related to routes and other intangibles | (3,416) | (2,778) | ||||
Net cash used by investing activities | (64,636) | (79,765) | ||||
Cash flows from financing activities: | ||||||
Proceeds from long-term debt | 8,264 | 2,138 | ||||
Payments on long-term debt | (8,638) | (10,974) | ||||
Borrowings from revolving credit facility | 219,933 | 156,829 | ||||
Payments on revolving credit facility | (100,782) | (138,147) | ||||
Net cash overdraft financing | (9,594) | 14,525 | ||||
Issuance of common stock | 67 | 12 | ||||
Repurchase of common stock | (55,044) | - | ||||
Minimum withholding taxes paid on stock awards | (4,328) | (3,190) | ||||
Acquisition of noncontrolling interest | (8,784) | - | ||||
Distributions to noncontrolling interests | (688) | - | ||||
Net cash provided by financing activities | 40,406 | 21,193 | ||||
Effect of exchange rate changes on cash flows | (6,916) | (1,575) | ||||
Net increase/(decrease) in cash, cash equivalents and restricted cash | 3,400 | (11,546) | ||||
Cash, cash equivalents and restricted cash at beginning of year | 73,045 | 107,369 | ||||
Cash, cash equivalents and restricted cash at end of period | $ 76,445 | $ 95,823 | ||||
Supplemental disclosure of cash flow information: | ||||||
Accrued capital expenditures | $ (1,630) | $ (8,623) | ||||
Cash paid during the period for: | ||||||
Interest, net of capitalized interest | $ 5,863 | $ 21,602 | ||||
Income taxes, net of refunds | $ 11,453 | $ 2,894 | ||||
Non-cash operating activities: | ||||||
Operating lease right of use obtained in exchange for new lease liabilities | $ 9,121 | $ 4,794 | ||||
Non-cash financing activities: | ||||||
Debt issued for service contract assets | $ 21 | $ - |
Diamond Green Diesel Joint Venture | ||||||
March 31, | December 31, | |||||
2020 | 2019 | |||||
Assets: | (unaudited) | |||||
Total current assets | $ 821,602 | $ 668,026 | ||||
Property, plant and equipment, net | 779,961 | 713,489 | ||||
Other assets | 30,446 | 30,710 | ||||
Total assets | $ 1,632,009 | $ 1,412,225 | ||||
Liabilities and members' equity: | ||||||
Total current portion of long term debt | $ 496 | $ 341 | ||||
Total other current liabilities | 70,758 | 75,802 | ||||
Total long term debt | 8,936 | 8,742 | ||||
Total other long term liabilities | 4,273 | 4,422 | ||||
Total members' equity | 1,547,546 | 1,322,918 | ||||
Total liabilities and members' equity | $ 1,632,009 | $ 1,412,225 |
Diamond Green Diesel Joint Venture | |||||||
(First Quarter Unaudited) | |||||||
Three Months Ended | |||||||
$ Change | |||||||
March 31, | March 31, | Favorable | |||||
Revenues: | 2020 | 2019 | (Unfavorable) | ||||
Operating revenues | $ 358,615 | $ 302,718 | $ 55,897 | ||||
Expenses: | |||||||
Total costs and expenses less | |||||||
depreciation, amortization and accretion expense | 151,347 | 243,063 | 91,716 | ||||
Depreciation, amortization and | 11,774 | 11,418 | (356) | ||||
accretion expense | ` | ||||||
Total costs and expenses | 163,121 | 254,481 | 91,360 | ||||
Operating income | 195,494 | 48,237 | 147,257 | ||||
Other income | 461 | 641 | (180) | ||||
Interest and debt expense, net | (315) | (324) | 9 | ||||
Net income | $ 195,640 | $ 48,554 | $ 147,086 |
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 | ||||
Three Months Ended | ||||
Adjusted EBITDA | March 28, | March 30, | ||
(U.S. dollars in thousands) | 2020 | 2019 | ||
Net income attributable to Darling | $ 85,510 | $ 18,012 | ||
Depreciation and amortization | 84,671 | 79,164 | ||
Interest expense | 19,090 | 19,876 | ||
Income tax expense | 18,300 | 5,274 | ||
Foreign currency loss/(gain) | (1,664) | 732 | ||
Other expense, net | 1,881 | 2,525 | ||
Equity in net (income) of Diamond Green Diesel | (97,820) | (24,277) | ||
Equity in net (income)/loss of unconsolidated subsidiaries | (869) | 504 | ||
Net income attributable to noncontrolling interests | 581 | 1,628 | ||
Adjusted EBITDA (Non-GAAP) | $ 109,680 | $ 103,438 | ||
Foreign currency exchange impact | 2,158 | (1) | - | |
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) | $ 111,838 | $ 103,438 | ||
DGD Joint Venture Adjusted EBITDA (Darling's Share) | $ 103,634 | $ 29,828 | ||
Darling plus Darling's share of DGD Joint Venture Adjusted EBITDA | $ 213,314 | $ 133,266 | ||
(1) The average rate assumption used in this calculation was the actual fiscal average rate for the three months ended March 28, 2020 of €1.00:USD$1.10 and CAD$1.00:USD$0.75, as compared to the average rate for the three months ended March 30, 2019 of €1.00:USD$1.14 and CAD$1.00:USD$0.75, respectively. |
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as collagen, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. 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 first quarter 2020 financial results at 8:30 am Eastern Time (7:30 am Central Time) on Thursday, May 7, 2020. 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 10142656. 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 May 14, 2020, 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 10142656. 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 expenses, 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.
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 and 5.25% Notes and 3.625% Notes that were outstanding at March 28, 2020. 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 and 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.
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," 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 project; 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.
IRVING, Texas, Feb. 25, 2020 /PRNewswire/ -- Darling Ingredients Inc. (NYSE:DAR) today announced that its joint venture with Valero Energy Corporation, Diamond Green Diesel ("DGD"), has entered into a long-term lease agreement with IMTT. The agreement will allow DGD access and use of the St. Rose IMTT Terminal as a logistics hub for DGD's existing and expanding renewable diesel facility located in Norco, LA. IMTT will, pursuant to the agreement, construct two 5-mile long pipelines connecting its St. Rose, LA terminal with the DGD Norco, LA renewable diesel facility. IMTT will also repurpose approximately 790,000 barrels of existing storage capacity from heavy and residual petroleum service to storage of renewable diesel feedstock and finished product as a part of the project. The pipeline build and the storage capacity transition are expected to be in service prior to the end of 2021, coinciding with the anticipated startup of DGD's current 400-million-gallon expansion project.
"We are extremely pleased to be working with IMTT. What is so often overlooked when discussing the critical success components of renewable diesel economics is the supply chain, which is both complicated and costly to manage," said John Bullock, EVP, Chief Strategy Officer for Darling Ingredients. "Having a world-class terminal like IMTT St. Rose accessible by pipeline with the capability to receive feedstocks and ship product via multiple modes of transport creates a significant competitive advantage for us. DGD has been a leader in the industry and developing a sophisticated and flexible supply chain is a continuation of our leadership position. We would not be in this business without a thorough plan that provides for flexibility in raw material sourcing and finished product marketing. This agreement places us in a position to economically source renewable diesel feedstock while allowing us to supply the best markets for our renewable diesel and naphtha."
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com and to review the Company's Environmental, Social and Governance (ESG) Factsheet at http://www.commitment.darlingii.com/metrics/esgfactsheet.
About IMTT
IMTT, International-Matex Tank Terminals (IMTT) is headquartered in New Orleans, Louisiana and is an industry leader in the handling and storage of bulk liquid products through its ownership and operation of 19 terminals throughout North America. The terminals handle petroleum, biofuels, commodity/specialty chemicals, and vegetable/tropical oil products for customers including refiners, commodities traders and chemical manufacturers and distributers.
Darling Ingredients contacts
Investors:
James Stark, Vice President Investor Relations Email: james.stark@darlingii.com Phone: 972-281-4823
Media:
Melissa A. Gaither, VP Global Communications & Sustainability Email: mgaither@darlingii.com Phone: 972-281-4478
Cautionary Statements Regarding Forward-Looking Information:
{This media release contains "forward-looking" statements regarding the business operations and prospects of Darling Ingredients Inc., including its Diamond Green Diesel (DGD) joint venture, and industry factors affecting it. These statements are identified by words such as "believe," "anticipate," "expect," "estimate," "intend," "would," "could," "may," "will," "should," "planned," "potential," "continue," "momentum," "assumption," 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, changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs like the Renewable Fuel Standards Program (RFS2), low carbon fuel standards (LCFS) and tax credits for biofuels both in the Unites States and abroad; and risks associated with the DGD renewable diesel plant in Norco, Louisiana, including possible unanticipated operating disruptions and issues related to the announced expansion project. 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.}
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SOURCE Darling Ingredients Inc.
IRVING, Texas, Jan. 2, 2020 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR), today announced that it has acquired the 50% joint venture interest of EnviroFlight, LLC owned by Intrexon Corporation (NASDAQ: XON), thereby increasing its ownership interest in EnviroFlight to 100%. EnviroFlight, LLC is a leading developer of proprietary technologies which enable the rearing of non-pathogenic black soldier fly (BSF) larvae in a scalable manner. This innovative and responsible approach has considerable potential within the sizable global animal feed industry as it will provide an environmentally-friendly, toxin-free, sustainable source of high-value nutrients. Enviroflight opened the first commercial BSF facility in Maysville, Kentucky in late 2018. Phase 1 of this production facility currently has the capacity to produce 900 tons of dried BSF larvae on an annual basis.
"Expanding our ownership of EnviroFlight empowers us to accelerate our ability to create higher value, sustainable specialty proteins for the agriculture and companion animal feed industries," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients. "Our purpose is to repurpose, and growing insects for specialty feed ingredients yields 10 times the usable protein per acre compared to producing algae and is at least 50 times the protein per acre compared to soy," Stuewe added. "We welcome the 62 EnviroFlight team members to the Darling Ingredients family."
"EnviroFlight has focused on driving necessary change in the global food supply chain to meet the demands of a growing population, and we look forward to working more closely with Darling Ingredients to realize the considerable promise of insect bioconversion to offer solutions that meet this goal," said Dr. Liz Koutsos, President of EnviroFlight.
EnviroFlight's insect-based approach offers substantial potential to recover the abundant food surpluses with significantly improved protein yield potential compared to traditional protein sources given their proficiency at converting organic materials into valuable proteins, oils, and frass. EnviroFlight's scalable approach utilizing BSF larvae opens the door to a plentiful source of high-quality nutrients for the animal feed and pet food industries. Virtually all animals eat insects in some capacity in their native environment, and notably within the fish and poultry markets, BSF larvae may be more representative of their typical diet than soybean meal and other plant-based proteins. Additionally, demand for fishmeal and fish oil is expected to outpace the supply for these products for application in the multi-billion dollar aquaculture industry, and BSF larvae meal has proven to be an excellent alternative to fishmeal.
EnviroFlight continues to work with regulatory agencies to gain approval to feed these ingredients to food animals and pets in the USA. EnviroFlight's comprehensive research program has demonstrated the safety, applicability and value of BSF-derived ingredients in the diets of poultry (broilers and laying hens), swine, and companion animals. The combination of highly digestible nutrients derived from an environmentally friendly process makes BSF larvae the natural choice to help feed animals.
Since late 2014, EnviroFlight has collaborated with Darling Ingredients to refine its scalable production processes for BSF larvae. Darling acquired a 50% ownership interest in EnviroFlight in 2016. With over 135 years of experience, Darling is the foremost reclaimer and processor of inexpensive bio-sustainable feedstocks, repurposing typically inedible ingredients into usable specialty feed and food solutions. Darling's operational expertise in this area combined with EnviroFlight's innovative approach employing BSF larvae will be leveraged to standardize processes for creating and optimizing BSFL-based feed.
About EnviroFlight
EnviroFlight is a leader in sustainable animal and plant nutrition aiming to drive transformative change in the global food supply. EnviroFlight's mission is to develop sustainable animal and plant nutrients using regionally available, low-value materials, emphasizing: production of nutrients in a socially responsible way; eliminate toxins, hormones, and antibiotics from our food supply; and reduce the environmental and financial costs to our food supply.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
Safe Harbor Statement
Some of the statements made in this press release are forward-looking statements. These forward-looking statements are based upon our current expectations and projections about future events and generally relate to our plans, objectives and expectations for the development of our business. Although management believes that the plans and objectives reflected in or suggested by these forward-looking statements are reasonable, all forward-looking statements involve risks and uncertainties and actual future results may be materially different from the plans, objectives and expectations expressed in this press release.
For more information contact: | |
Media | Investors |
Melissa A. Gaither | Jim Stark |
VP Global Communications & Sustainability | VP, Investor Relations |
Phone: +1 (972) 281-4478 | +1 (972) 281-4823 |
Email: mgaither@darlingii.com |
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SOURCE Darling Ingredients Inc.
IRVING, Texas, Nov. 11, 2019 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) today announced the hiring of James E. Stark as its new VP, Investor Relations. Melissa Gaither, current VP of Investor Relations and Global Communications, will refocus her role as VP of Global Communications and Sustainability. As Darling continues to grow, this organizational change will more effectively address the increasing demands from the investor community and how Darling communicates its corporate philosophy and strategic operations.
Mr. Stark comes to Darling after an outstanding career at Green Plains Inc., based in Omaha, NE, where he held the position of EVP, Investor and Media Relations. Jim will begin his new role in December and will report to Randall C. Stuewe, Darling's Chairman and CEO. Ms. Gaither's new role helps position the company to further develop and target Darling's long-term ESG message.
As Darling Ingredients has evolved in complexity and expanded around the world, the company must spend more time refining and communicating their business strategy and results to its stakeholders; this includes shareholders, customers, employees and the communities they serve. Additionally, in today's changing times, when businesses must not overlook their responsibility to protect the planet, Corporate Social Responsibility messaging has evolved to not only demonstrate sustainable and responsible operations but to also measure and report on targets identified in Environmental, Social and Governance platforms.
By having dedicated roles for investor relations and sustainability, these critical areas can more efficiently receive focused attention and communicate with all stakeholders with a unified, well-defined message.
Darling Ingredients Chairman and Chief Executive Officer, Randall Stuewe, said, "We are pleased to announce the hiring of Jim Stark as VP, Investor Relations. Jim brings a wealth of experience and knowledge related to energy, food and agriculture to our team. Together with Melissa Gaither's extensive tenure with Darling, we are building a strong team to take Darling into the future."
ABOUT DARLING
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
For More Information, contact:
Melissa A. Gaither, VP Global Communications and Sustainability
5601 N. MacArthur Blvd.
Irving, Texas 75038
Phone: 972-281-4478
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SOURCE Darling Ingredients Inc.
IRVING, Texas, Sept. 9, 2019 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) and Valero Energy Corporation (NYSE: VLO) ("Valero") are addressing the growing demand for renewable diesel in global, low carbon markets by initiating an advanced engineering and development cost review for a new plant in Port Arthur, Texas. The proposed facility under review would be designed to produce 400 million gallons of renewable diesel annually as well as 40 million gallons of renewable naphtha. The new plant would be owned and operated by Diamond Green Diesel Holdings LLC ("DGD"), the 50/50 joint venture between Darling Ingredients and Valero.
The proposed Port Arthur plant, the first renewable diesel facility in Texas, would be in a location to leverage Valero's existing refinery and optimize logistics management. The production from this new plant would increase DGD's annual renewable diesel production to approximately 1.1 billion gallons with nearly 100 million gallons of renewable naphtha production. The final investment decision on the project is expected in 2021, subject to further engineering, obtaining necessary permits, and approval by the boards of Darling and Valero. If the decision is made to move forward, new plant construction could begin in 2021, with expected operations commencing in 2024.
"The demand for a low carbon fuel solution continues to grow, as markets move to reduce their carbon intensity. Leveraging its proven technology, DGD continues to adapt and expand production to address that need for the benefit of our environment, our customers and our shareholders," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "Diamond Green Diesel has become the most efficient and immediate drop-in, low carbon fuel solution by capitalizing on the powerful combination of Valero's refining operations and marketing capabilities with Darling's integrated supply chain and raw material sourcing expertise. With these complementary capabilities, Diamond Green Diesel has established itself as the leading industry standard in North America—providing a premier product to the world's expanding low carbon fuel markets."
DGD's future total annual capacity of 1.1 billion gallons of renewable diesel and nearly 100 million gallons of renewable naphtha includes production from DGD's Norco, Louisiana refinery, which is currently being expanded to produce 675 million gallons of renewable diesel and 60 million gallons of naphtha. The Louisiana expansion is targeted for completion at the end of 2021.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
About Valero
Valero Energy Corporation, through its subsidiaries (collectively, "Valero"), is an international manufacturer and marketer of transportation fuels and petrochemical products. Valero is a Fortune 50 company based in San Antonio, Texas, and it operates 15 petroleum refineries with a combined throughput capacity of approximately 3.1 million barrels per day and 14 ethanol plants with a combined production capacity of 1.73 billion gallons per year. The petroleum refineries are located in the United States (U.S.), Canada and the United Kingdom (U.K.), and the ethanol plants are located in the Mid-Continent region of the U.S. Valero also is a joint venture partner in Diamond Green Diesel, which operates a renewable diesel plant in Norco, Louisiana. Diamond Green Diesel is North America's largest biomass-based diesel plant. Valero sells its products in the wholesale rack or bulk markets in the U.S., Canada, the U.K., Ireland and Latin America. Approximately 7,000 outlets carry Valero's brand names. Please visit www.valero.com for more information.
Darling Ingredients contact | |
Melissa A. Gaither, VP IR and Global Communications | Email : mgaither@darlingii.com |
5601 N. MacArthur Blvd, Irving, Texas 75038 | Phone : 972-281-4478 |
Valero Contacts | |
Investors: | |
Homer Bhullar, Vice President – Investor Relations, 210-345-1982 | |
Media: | |
Lillian Riojas, Executive Director – Media Relations and Communications, 210-345-5002 |
Cautionary Statements Regarding Forward-Looking Information:
{This media release contains "forward-looking" statements regarding the business operations and prospects of Darling Ingredients Inc., including its Diamond Green Diesel (DGD) joint venture, and industry factors affecting it. These statements are identified by words such as "believe," "anticipate," "expect," "estimate," "intend," "would," "could," "may," "will," "should," "planned," "potential," "continue," "momentum," "assumption," 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, changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs like the Renewable Fuel Standards Program (RFS2), low carbon fuel standards (LCFS) and tax credits for biofuels both in the Unites States and abroad; and risks associated with the DGD renewable diesel plant in Norco, Louisiana, including possible unanticipated operating disruptions and issues related to the announced expansion project. 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.}
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SOURCE Darling Ingredients Inc.
IRVING, Texas, Aug. 7, 2019 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR), a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy, and fertilizer industries, today announced financial results for the 2019 second quarter ended June 29, 2019.
Second Quarter 2019 Overview
For the second quarter of 2019, the Company reported net sales of $827.3 million, as compared with net sales of $846.6 million for the second quarter of 2018. The reduction in net sales of $(19.3) million is mainly the result of lower global protein prices and the divestiture of the Company's industrial residuals business in May 2018 which was partially offset by the increase in sales volumes of the specialty pet food business and increased collagen sales values.
Net income attributable to Darling for the three months ended June 29, 2019 was $26.3 million, or $0.16 per diluted share, compared to a net loss of $(30.4) million, or $(0.18) per diluted share, for the second quarter of 2018. The increase in net income over the same period in fiscal 2018 reflects the absence of the following one-time costs realized last year: debt extinguishment costs of $23.5 million related to Euro bond refinancing; the loss of $15.5 million from the sale of Terra Renewal Services subsidiary; and $15.0 million of restructuring and impairment charges incurred as a result of the Hurlingham, Argentina, gelatin plant closure.
Comments on the Second Quarter 2019
"Overall, earnings improved for the second quarter with combined, pro forma adjusted EBITDA of $159.4 million, inclusive of core Darling and Diamond Green Diesel adjusted EBITDA results and $13.2 million gain from the China property sale. Operationally, our global rendering business faced negative market conditions on our finished product pricing due to unresolved trade agreements with China and continued fallout from the African Swine Fever epidemic," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "Our food segment showed strong performance again bolstered by volume growth from new product launches, primarily related to our growing global collagen business. Our Fuel segment delivered consistently without the Blender's Tax Credit (BTC).
"Diamond Green Diesel, our 50/50 joint venture with Valero, performed well and met expected entity level EBITDA of $1.25 per gallon. Subsequent to the end of the first quarter, we also received two partner dividends totaling $55.5 million, with $17.7 million being recorded in the second quarter and the remainder to be posted in our 2019 third quarter. Additionally, Super Diamond, our 400-mm gallon expansion project, remains on track to start up at the end of 2021.
"We continue to successfully overcome headwinds from the current macro environment. This is an ongoing demonstration that our diverse global platform and our integrated supply chain provide Darling a competitive advantage to achieve our mission of driving sustainable solutions for feeding and fueling our growing world, while at the same time driving value for our shareholders and our team members," Stuewe concluded.
Operational Update by Segment
Financial Update by Segment
Feed Ingredients | Three Months Ended | Six Months Ended | |||
($ thousands) | June 29, 2019 | June 30, 2018 | June 29, 2019 | June 30, 2018 | |
Net sales (1) | $ 487,447 | $ 498,823 | $ 983,266 | $ 984,621 | |
Loss (gain) on sale of assets | (524) | 782 | (4,914) | 420 | |
Selling, general and administrative expenses | 46,465 | 43,947 | 95,296 | 92,212 | |
Depreciation and amortization | 48,720 | 46,823 | 98,089 | 93,612 | |
Segment operating income | 15,831 | 37,264 | 30,981 | 58,921 | |
Adjusted EBITDA (2) | $ 64,551 | $ 84,087 | $ 129,070 | $ 152,533 |
(1) | Includes revenue recognition reclass for billed freight moved to cost of sales per new revenue standard |
(2) | Adjusted EBITDA calculated by adding depreciation and amortization to segment operating income |
Food Ingredients | Three Months Ended | Six Months Ended | |||
($ thousands) | June 29, 2019 | June 30, 2018 | June 29, 2019 | June 30, 2018 | |
Net sales (1) | $ 274,835 | $ 276,729 | $ 553,999 | $ 582,249 | |
Loss (gain) on sale of assets | (13,379) | (57) | (13,265) | (212) | |
Selling, general and administrative expenses | 23,431 | 22,190 | 45,318 | 46,051 | |
Restructuring and impairment charges | - | 14,965 | - | 14,965 | |
Depreciation and amortization | 19,861 | 20,388 | 39,372 | 41,028 | |
Segment operating income/(loss) | 30,478 | (5,649) | 54,126 | 6,184 | |
Adjusted EBITDA (2) | $ 50,339 | $ 14,739 | $ 93,498 | $ 47,212 |
(1) | Includes revenue recognition reclass for billed freight moved to cost of sales per new revenue standard |
(2) | Adjusted EBITDA calculated by adding depreciation and amortization and restructuring and impairment charges to segment operating income |
Fuel Ingredients | Three Months Ended | Six Months Ended | |||
($ thousands) | June 29, 2019 | June 30, 2018 | June 29, 2019 | June 30, 2018 | |
Net sales (1) | $ 65,042 | $ 71,094 | $ 125,163 | $ 155,150 | |
Loss (gain) on sale of assets | (23) | 37 | 3 | 92 | |
Selling, general and administrative expenses | 425 | 164 | (329) | (1,234) | |
Depreciation and amortization | 8,362 | 8,537 | 16,160 | 17,008 | |
Segment operating income | 2,961 | 5,016 | 5,962 | 22,173 | |
Adjusted EBITDA (2) | $ 11,323 | $ 13,553 | $ 22,122 | $ 39,181 |
(1) | Includes revenue recognition reclass for billed freight moved to cost of sales per new revenue standard |
(2) | Adjusted EBITDA calculated by adding depreciation and amortization to segment operating income |
Fuel Ingredients Segment results shown do not include the Diamond Green Diesel (DGD) 50% Joint Venture |
Darling Ingredients Inc. and Subsidiaries | |||||||||||||
Consolidated Operating Results | |||||||||||||
For the Periods Ended June 29, 2019 and June 30, 2018 | |||||||||||||
(in thousands, except per share data) | |||||||||||||
(unaudited) | |||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||
$ Change | $ Change | ||||||||||||
June 29, | June 30, | Favorable | June 29, | June 30, | Favorable | ||||||||
2019 | 2018 | (Unfavorable) | 2019 | 2018 | (Unfavorable) | ||||||||
Net sales | $ 827,324 | $ 846,646 | $ (19,322) | $ 1,662,428 | $ 1,722,020 | $ (59,592) | |||||||
Costs and expenses: | |||||||||||||
Cost of sales and operating expenses | 644,716 | 652,239 | 7,523 | 1,295,629 | 1,330,800 | 35,171 | |||||||
Loss (gain) on sale of assets | (13,926) | 762 | 14,688 | (18,176) | 300 | 18,476 | |||||||
Selling, general and administrative expenses | 81,017 | 78,558 | (2,459) | 166,020 | 165,460 | (560) | |||||||
Restructuring and impairment charges | - | 14,965 | 14,965 | - | 14,965 | 14,965 | |||||||
Depreciation and amortization | 79,486 | 78,454 | (1,032) | 158,650 | 157,073 | (1,577) | |||||||
Total costs and expenses | 791,293 | 824,978 | 33,685 | 1,602,123 | 1,668,598 | 66,475 | |||||||
Operating income | 36,031 | 21,668 | 14,363 | 60,305 | 53,422 | 6,883 | |||||||
Other expense: | |||||||||||||
Interest expense | (20,853) | (23,016) | 2,163 | (40,729) | (46,140) | 5,411 | |||||||
Debt extinguishment costs | (12,126) | (23,509) | 11,383 | (12,126) | (23,509) | 11,383 | |||||||
Foreign currency loss | (388) | (3,495) | 3,107 | (1,120) | (4,976) | 3,856 | |||||||
Gain/(loss) on disposal of subsidiaries | - | (15,538) | 15,538 | - | (15,538) | 15,538 | |||||||
Other (expense)/gain, net | (2,019) | 1,199 | (3,218) | (4,544) | (1,317) | (3,227) | |||||||
Total other expense | (35,386) | (64,359) | 28,973 | (58,519) | (91,480) | 32,961 | |||||||
Equity in net income of unconsolidated subsidiaries | 38,175 | 15,236 | 22,939 | 61,948 | 112,390 | (50,442) | |||||||
Income/(loss) before income taxes | 38,820 | (27,455) | 66,275 | 63,734 | 74,332 | (10,598) | |||||||
Income taxes expense | 7,776 | 1,683 | (6,093) | 13,050 | 5,395 | (7,655) | |||||||
Net income/(loss) | 31,044 | (29,138) | 60,182 | 50,684 | 68,937 | (18,253) | |||||||
Net income attributable to noncontrolling interests | (4,786) | (1,282) | (3,504) | (6,414) | (2,052) | (4,362) | |||||||
Net income/(loss) attributable to Darling | $ 26,258 | $ (30,420) | $ 56,678 | $ 44,270 | $ 66,885 | $ (22,615) | |||||||
Basic income/(loss) per share: | $ 0.16 | $ (0.18) | $ 0.34 | $ 0.27 | $ 0.41 | $ (0.14) | |||||||
Diluted income/(loss) per share: | $ 0.16 | $ (0.18) | $ 0.34 | $ 0.26 | $ 0.40 | $ (0.14) | |||||||
Number of diluted common shares | 168,432 | 164,651 | 168,546 | 166,259 |
Darling Ingredients Inc. and Subsidiaries | ||||
Condensed Consolidated Balance Sheets | ||||
June 29, 2019 and December 29, 2018 | ||||
(in thousands) | ||||
June 29, | December 29, | |||
2019 | 2018 | |||
ASSETS | (unaudited) | |||
Current assets: | ||||
Cash and cash equivalents | $ 87,011 | $ 107,262 | ||
Restricted cash | 103 | 107 | ||
Accounts receivable, net | 357,671 | 385,737 | ||
Inventories | 348,309 | 341,028 | ||
Prepaid expenses | 44,363 | 35,247 | ||
Income taxes refundable | 5,554 | 6,462 | ||
Other current assets | 24,127 | 22,099 | ||
Total current assets | 867,138 | 897,942 | ||
Property, plant and equipment, less accumulated depreciation, net | 1,722,296 | 1,687,858 | ||
Intangible assets, less accumulated amortization, net | 565,976 | 595,862 | ||
Goodwill | 1,233,486 | 1,229,159 | ||
Investment in unconsolidated subsidiaries | 458,032 | 410,177 | ||
Operating lease right-of-use assets | 120,950 | - | ||
Other assets | 54,353 | 53,375 | ||
Deferred income taxes | 14,365 | 14,981 | ||
Total assets | $ 5,036,596 | $ 4,889,354 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Current portion of long-term debt | $ 35,877 | $ 7,492 | ||
Accounts payable, principally trade | 208,901 | 219,479 | ||
Income taxes payable | 10,291 | 4,043 | ||
Current operating lease liabilities | 36,703 | - | ||
Accrued expenses | 274,534 | 309,484 | ||
Total current liabilities | 566,306 | 540,498 | ||
Long-term debt, net of current portion | 1,640,056 | 1,666,940 | ||
Long-term operating lease liabilities | 83,440 | - | ||
Other non-current liabilities | 113,086 | 115,032 | ||
Deferred income taxes | 227,073 | 231,063 | ||
Total liabilities | 2,629,961 | 2,553,533 | ||
Commitments and contingencies | ||||
Total Darling's stockholders' equity | 2,342,911 | 2,273,048 | ||
Noncontrolling interests | 63,724 | 62,773 | ||
Total stockholders' equity | $ 2,406,635 | $ 2,335,821 | ||
$ 5,036,596 | $ 4,889,354 |
Darling Ingredients Inc. and Subsidiaries | ||||||
Consolidated Statement of Cash Flows | ||||||
Six Months Ended June 29, 2019 and June 30, 2018 | ||||||
(in thousands) | ||||||
(unaudited) | ||||||
Six Months Ended | ||||||
June 29, | June 30, | |||||
Cash flows from operating activities: | 2019 | 2018 | ||||
Net income | $ 50,684 | $ 68,937 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||
Depreciation and amortization | 158,650 | 157,073 | ||||
Loss/(gain) on disposal of property, plant, equipment and other assets | (18,176) | 300 | ||||
Loss on disposal of subsidiaries | - | 15,538 | ||||
Asset impairment | - | 2,907 | ||||
Gain on insurance proceeds from insurance settlements | (845) | (1,253) | ||||
Deferred taxes | (3,137) | (7,512) | ||||
Increase in long-term pension liability | 1,010 | 123 | ||||
Stock-based compensation expense | 14,182 | 13,232 | ||||
Write-off deferred loan costs | 4,547 | 8,105 | ||||
Deferred loan cost amortization | 3,010 | 4,664 | ||||
Equity in net income of unconsolidated subsidiaries | (61,948) | (112,390) | ||||
Distribution of earnings from unconsolidated subsidiaries | 17,755 | 26,567 | ||||
Changes in operating assets and liabilities, net of effects from acquisitions: | ||||||
Accounts receivable | 27,218 | 5,217 | ||||
Income taxes refundable/payable | 7,140 | (5,438) | ||||
Inventories and prepaid expenses | (17,374) | (30,561) | ||||
Accounts payable and accrued expenses | (29,849) | (25,705) | ||||
Other | 1,437 | 8,243 | ||||
Net cash provided by operating activities | 154,304 | 128,047 | ||||
Cash flows from investing activities: | ||||||
Capital expenditures | (167,871) | (139,130) | ||||
Acquisitions, net of cash acquired | (1,431) | (51,089) | ||||
Investment of unconsolidated subsidiaries | (1,000) | (6,500) | ||||
Proceeds from sale of investment in subsidiaries | - | 82,805 | ||||
Gross proceeds from disposal of property, plant and equipment and other assets | 9,814 | 2,244 | ||||
Proceeds from insurance settlement | 845 | 1,253 | ||||
Payments related to routes and other intangibles | (3,150) | (294) | ||||
Net cash used by investing activities | (162,793) | (110,711) | ||||
Cash flows from financing activities: | ||||||
Proceeds from long-term debt | 507,722 | 623,695 | ||||
Payments on long-term debt | (526,230) | (650,976) | ||||
Borrowings from revolving credit facility | 273,485 | 247,975 | ||||
Payments on revolving credit facility | (266,884) | (221,632) | ||||
Net cash overdraft financing | 11,178 | 4,517 | ||||
Deferred loan costs | (7,003) | (9,324) | ||||
Issuance of common stock | 12 | 182 | ||||
Minimum withholding taxes paid on stock awards | (3,193) | (2,123) | ||||
Distributions to noncontrolling interests | - | (983) | ||||
Net cash used by financing activities | (10,913) | (8,669) | ||||
Effect of exchange rate changes on cash | (853) | (11,321) | ||||
Net decrease in cash, cash equivalents and restricted cash | (20,255) | (2,654) | ||||
Cash, cash equivalents and restricted cash at beginning of period | 107,369 | 106,916 | ||||
Cash, cash equivalents and restricted cash at end of period | $ 87,114 | $ 104,262 | ||||
Supplemental disclosure of cash flow information: | ||||||
Accrued capital expenditures | $ (7,542) | $ (6,336) | ||||
Cash paid during the period for: | ||||||
Interest, net of capitalized interest | $ 45,196 | $ 39,614 | ||||
Income taxes, net of refunds | $ 12,607 | $ 17,154 | ||||
Non-cash operating activities | ||||||
Operating lease right of use asset obtained in exchange for new lease liabilities | $ 7,492 | $ - | ||||
Non-cash financing activities | ||||||
Debt issued for assets | $ - | $ 17 |
Selected financial information for the Company's Diamond Green Diesel Joint Venture is as follows:
Diamond Green Diesel Joint Venture | |||||
Condensed Consolidated Balance Sheets | |||||
June 30, 2019 and December 31, 2018 | |||||
(in thousands) | |||||
June 30, | December 31, | ||||
2019 | 2018 | ||||
Assets: | (unaudited) | ||||
Total current assets | $ 252,521 | $ 186,258 | |||
Property, plant and equipment, net | 621,733 | 576,384 | |||
Other assets | 23,877 | 24,601 | |||
Total assets | $ 898,131 | $ 787,243 | |||
Liabilities and members' equity: | |||||
Total current portion of long term debt | $ 284 | $ 189 | |||
Total other current liabilities | 51,828 | 40,619 | |||
Total long term debt | 8,936 | 8,485 | |||
Total other long term liabilities | 4,511 | 539 | |||
Total members' equity | 832,572 | 737,411 | |||
Total liabilities and members' equity | $ 898,131 | $ 787,243 |
Diamond Green Diesel Joint Venture | ||||||||||||||
Operating Financial Results | ||||||||||||||
Three Months and Six Months Ended June 30, 2019 and June 30, 2018 | ||||||||||||||
(in thousands) | ||||||||||||||
(unaudited) | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
$ Change | $ Change | |||||||||||||
June 30, | June 30, | Favorable | June 30, | June 30, | Favorable | |||||||||
Revenues: | 2019 | 2018 | (Unfavorable) | 2019 | 2018 | (Unfavorable) | ||||||||
Operating revenues | $ 294,811 | $ 151,989 | $ 142,822 | $ 597,529 | $ 302,310 | $ 295,219 | ||||||||
Expenses: | ||||||||||||||
Total costs and expenses less depreciation, amortization and accretion expense | 207,024 | 115,659 | (91,365) | 450,087 | 65,838 | (384,249) | ||||||||
Depreciation, amortization and accretion expense | 11,914 | 6,254 | (5,660) | 23,332 | 12,374 | (10,958) | ||||||||
Total costs and expenses | 218,938 | 121,913 | (97,025) | 473,419 | 78,212 | (395,207) | ||||||||
Operating income | 75,873 | 30,076 | 45,797 | 124,110 | 224,098 | (99,988) | ||||||||
Other income | 634 | 415 | 219 | 1,275 | 792 | 483 | ||||||||
Interest and debt expense, net | (321) | (319) | (2) | (645) | (319) | (326) | ||||||||
Net income | $ 76,186 | $ 30,172 | $ 46,014 | $ 124,740 | $ 224,571 | $ (99,831) |
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 | ||||||||
Three and six months ended June 29, 2019 and June 30, 2018 | ||||||||
Three Months Ended - Year over Year | Six Months Ended - Year over Year | |||||||
Adjusted EBITDA | June 29, | June 30, | June 29, | June 30, | ||||
(U.S. dollars in thousands) | 2019 | 2018 | 2019 | 2018 | ||||
Net income/(loss) attributable to Darling | $ 26,258 | $ (30,420) | $ 44,270 | $ 66,885 | ||||
Depreciation and amortization | 79,486 | 78,454 | 158,650 | 157,073 | ||||
Interest expense | 20,853 | 23,016 | 40,729 | 46,140 | ||||
Income tax expense | 7,776 | 1,683 | 13,050 | 5,395 | ||||
Restructuring and impairment charges | - | 14,965 | - | 14,965 | ||||
Foreign currency loss | 388 | 3,495 | 1,120 | 4,976 | ||||
Other expense/(income), net | 2,019 | (1,199) | 4,544 | 1,317 | ||||
Debt extinguishment costs | 12,126 | 23,509 | 12,126 | 23,509 | ||||
Loss on sale of subsidiary | - | 15,538 | - | 15,538 | ||||
Equity in net (income) of unconsolidated subsidiaries | (38,175) | (15,236) | (61,948) | (112,390) | ||||
Net income attributable to noncontrolling interests | 4,786 | 1,282 | 6,414 | 2,052 | ||||
Adjusted EBITDA | $ 115,517 | $ 115,087 | $ 218,955 | $ 225,460 | ||||
Foreign currency exchange impact (1) | 5,605 | - | 11,661 | - | ||||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) | $ 121,122 | $ 115,087 | $ 230,616 | $ 225,460 | ||||
DGD Joint Venture Adjusted EBITDA (Darling's share) | $ 43,894 | $ 18,165 | $ 73,721 | $ 118,236 |
(1) | The average rates assumption used in the calculation was the actual fiscal average rate for the three months ended June 29, 2019 of €1.00:USD$1.12 and CAD$1.00:USD$0.75 as compared to the average rate for the three months ended June 30, 2018 of €1.00:USD$1.20 and CAD$1.00:USD$0.77, respectively. |
The average rates assumption used in the calculation was the actual fiscal average rate for the six months ended June 29, 2019 of €1.00:USD$1.13 and CAD$1.00:USD$0.75 as compared to the average rate for the six months ended June 30, 2018 of €1.00:USD$1.22 and CAD$1.00:USD$0.78, respectively. |
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. 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 2019 financial results at 8:30 am Eastern Time (7:30 am Central Time) on Thursday, August 8, 2019. 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 10132938. 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 15, 2019, by dialing 1-877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 1-412-317-0088 (international callers). The access code for the replay is 10132938. 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 expenses, 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.
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 and 5.25% Notes and 3.625% Notes that were outstanding at June 29, 2019. 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 and 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.
Cautionary Statements Regarding Forward-Looking Information:
This media release contains "forward-looking" statements that are subject to risks and uncertainties that could cause the actual results of Darling Ingredients Inc. (the "Company") to differ materially from those expressed or implied in the statements. Statements that are not statements of historical facts are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as "estimate," "project," "planned," "contemplate," "potential," "possible," "proposed," "intend," "believe," "anticipate," "expect," "may," "will," "would," "should," "could" and similar expressions are intended to identify forward-looking statements. Forward-looking statements are based on the Company's current expectations and assumptions regarding its business, the economy and other future conditions. The Company cautions readers that any such forward-looking statements it makes are not guarantees of future performance and that actual results may differ materially from anticipated results or expectations expressed in its forward-looking statements as a result of a variety of factors, including many that are beyond the Company's control. 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 Unites 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 recent African Swine Fever ("ASF") outbreak in China; 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 or 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 project; 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, including our ongoing enterprise resource planning project; 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 likely 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 presentation 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: | ||
Melissa A. Gaither, VP IR and Global Communications | Email : mgaither@darlingii.com | |
5601 North MacArthur Blvd., Irving, Texas 75038 | Phone : 972-281-4478 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-reports-second-quarter-2019-financial-results-300898093.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, May 7, 2019 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) will hold a conference call and webcast on Thursday, May 9, 2019 to discuss the Company's first quarter financial results. The teleconference will begin at 8:30 a.m. ET and will be hosted by Mr. Randall Stuewe, CEO and Chairman of the Board, and Mr. Brad Phillips, EVP and Chief Financial Officer. Additionally, the Company will have a slide presentation available to augment management's formal remarks, which will be accessible via the investor relations section of the Company's website. The related press release will be issued after the market closes on May 8, 2019.
Due to historically high call volume, the company is offering participants the opportunity to register in advance for the conference through the following link: http://dpregister.com/10130603.
Registered participants will receive an email with a calendar reminder and a dial-in number and PIN that will allow them immediate access to the call on May 9, 2019.
Participants who do not wish to pre-register for the call may dial in using 844-868-8847 (U.S. callers), or 412-317-6593 (international callers), and ask for the "Darling Ingredients" call. A replay will be available two hours after completion of the call through May 16, 2019. To access the replay, please dial 877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 412-317-0088 (international callers) and reference passcode 10130603. The live webcast and archived replay also can be accessed on the Company's web site at http://ir.darlingii.com.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, nutraceutical, food, pet food, feed, industrial, fuel, bioenergy and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments and disposal services for waste solids from the wastewater treatment systems of industrial food processing plants. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
For More Information, contact: | ||
Melissa A. Gaither, VP Investor Relations | 251 O'Connor Ridge Blvd., Suite 300 | |
& Global Communications | Irving, Texas 75038 | |
Phone: 972-717-0300 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-first-quarter-2019-earnings-conference-call-and-webcast-300844648.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, March 28, 2019 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) ("Darling" or the "Company") today announced that it has priced a private offering of $500 million in aggregate principal amount of its 5.25% unsecured senior notes due 2027 (the "Notes"). The Notes were priced at 100% of their face amount. The offering is expected to close on April 3, 2019, subject to the satisfaction of customary closing conditions.
The gross proceeds from the offering of the Notes, together with cash on hand, are expected to be used to refinance all of the Company's 5.375% Senior Notes due 2022 by cash tender offer for those notes, and, if and to the extent necessary, redemption of those notes, and to pay any applicable premiums for the refinancing, to pay the discount of the initial purchasers of the Notes and to pay the other fees and expenses related to the offering of the Notes.
The Notes will be offered in the United States to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside the United States to non‑U.S. persons in reliance on Regulation S under the Securities Act. The Notes will not be registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws.
This media release shall not constitute an offer to sell or the solicitation of an offer to buy the Notes, nor shall there be any offer to sell, solicitation of an offer to buy or sale of the Notes, in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as collagen, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients.
Cautionary Statements Regarding Forward‑Looking Information:
This announcement 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," and other words referring to events that may occur in the future. These statements reflect the Company'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 emissions that adversely affect programs like the U.S. government's renewable fuel standard, low carbon fuel standards 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, bovine spongiform encephalopathy ("BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere, such as the recent African Swine Fever ("ASF") outbreak in China; 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, 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 Diamond Green Diesel joint venture, including possible unanticipated operating disruptions and issues relating to the announced expansion project; 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 the Company's information systems or failure to implement new systems and software successfully, including the Company's ongoing enterprise resource planning project; 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 likely 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 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. Other risks and uncertainties regarding the Company, 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. The Company 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:
Melissa A. Gaither, VP IR and Global Communications
Email: mgaither@darlingii.com
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038
Phone: 972‑281-4478
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-pricing-of-private-offering-of-500-million-of-unsecured-senior-notes-due-2027-300820552.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, March 27, 2019 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) ("Darling" or the "Company") today announced the commencement of a cash tender offer (the "Tender Offer") for any and all of its outstanding 5.375% Senior Notes due 2022 (the "Notes"). The Tender Offer is being made on the terms and subject to the conditions set forth in the offer to purchase dated March 27, 2019 (as it may be amended or supplemented, the "Offer to Purchase"), the related letter of transmittal (as it may be amended or supplemented, the "Letter of Transmittal") and the related notice of guaranteed delivery (as it may be amended or supplemented, the "Notice of Guaranteed Delivery").
The following table sets forth the material pricing terms of the Tender Offer:
Title of | CUSIP Numbers/ISINs | Principal Amount | Purchase |
5.375% Senior | 237266 AG6 / US237266AG66 144A (CUSIP/ISIN): 237264 AA4 / US237264AA49 Regulation S (CUSIP/ISIN): U23534 AA5 / USU23534AA57 | $500,000,000 | $1,015.25(*) |
_________________________________ |
*Per $1,000 principal amount of Notes. |
Holders (as defined in the Offer to Purchase) of Notes who validly tender (and do not validly withdraw) their Notes in the Tender Offer at or prior to 5:00 p.m., New York City time, on April 2, 2019, unless extended (such time and date, as the same may be extended, the "Expiration Time"), or who deliver to D.F. King & Co., Inc. ("D.F. King") a properly completed and duly executed Notice of Guaranteed Delivery at or prior to the Expiration Time will be eligible to receive in cash $1,015.25 per $1,000 principal amount of Notes (the "Purchase Price") validly tendered and accepted for purchase pursuant to the Tender Offer, plus accrued and unpaid interest ("Accrued Interest") from the last interest payment date for the Notes to, but excluding, the settlement date, which is expected to be April 3, 2019 (the "Settlement Date"). With respect to Notes tendered and accepted for purchase, if any, pursuant to the guaranteed delivery procedures described in the Offer to Purchase, the Holders thereof will receive payment of the Purchase Price for such Notes, plus Accrued Interest to, but excluding, the Settlement Date, on the Guaranteed Delivery Settlement Date (as defined in the Offer to Purchase), which is expected to be April 5, 2019. For the avoidance of doubt, Accrued Interest will cease to accrue on the Settlement Date for all Notes accepted for purchase pursuant to the Tender Offer, including those tendered pursuant to the guaranteed delivery procedures.
Tendered Notes may be validly withdrawn from the Tender Offer at any time (i) at or prior to the earlier of (x) the Expiration Time, and (y) in the event that the Tender Offer is extended, the tenth business day after commencement of the Tender Offer, and (ii) after the 60th business day after commencement of the Tender Offer if for any reason the Tender Offer has not been consummated within 60 business days of the commencement of the Tender Offer. The Tender Offer is subject to the satisfaction or waiver by Darling of a number of conditions as set forth in the Offer to Purchase, including the completion by Darling of a proposed debt financing on terms reasonably satisfactory to Darling, in its sole discretion and subject to applicable law (the "Debt Financing"), generating net proceeds in an amount that, together with cash on hand, is sufficient to effect the repurchase of the Notes validly tendered and accepted for purchase pursuant to the Tender Offer, including the payment of any Accrued Interest and costs and expenses incurred in connection therewith. Darling may amend, extend or terminate the Tender Offer in its sole discretion and subject to applicable law.
Darling has retained BofA Merrill Lynch to serve as dealer manager for the Tender Offer. Darling has appointed D.F. King to serve as the tender agent and information agent for the Tender Offer.
For additional information regarding the terms of the Tender Offer, please contact BofA Merrill Lynch at (888) 292-0070 (toll-free) or (980) 387-5602 (collect). Questions regarding the Tender Offer should be directed to D.F. King at (212) 269-5550 (banks and brokers) or (800) 591-6313 (all others) or email dar@dfking.com. Documents for the Tender Offer, including the Offer to Purchase, Letter of Transmittal and Notice of Guaranteed Delivery, are available at www.dfking.com/dar, and may also be obtained by contacting D.F. King by telephone.
Darling plans to redeem any Notes that remain outstanding after the completion of the Tender Offer. The current redemption price of the Notes, excluding accrued but unpaid interest, is 101.344% of their principal amount, which is less than the Purchase Price. This announcement does not constitute a notice of redemption or an obligation to issue a notice of redemption. There can be no assurance that any Notes that remain outstanding after the completion of the Tender Offer will be redeemed or otherwise repurchased.
None of Darling or its directors, the dealer manager, D.F. King or the trustee for the Notes, or any of their respective affiliates, is making any recommendation as to whether Holders should tender any Notes in response to the Tender Offer. Holders must make their own decision as to whether to tender any of their Notes and, if so, the principal amount of Notes to tender.
This announcement is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell securities. The Tender Offer is being made solely by means of the Offer to Purchase, the related Letter of Transmittal and the Notice of Guaranteed Delivery. In those jurisdictions where the securities, blue sky or other laws require the Tender Offer to be made on behalf of Darling by a licensed broker or dealer, the Tender Offer will be deemed to be made by the dealer manager or one or more registered brokers or dealers licensed under the laws of such jurisdiction. This announcement does not constitute an offer to sell or a solicitation of an offer to buy any securities or other financial instruments that may be issued or otherwise incurred in connection with the Debt Financing.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as collagen, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients.
Cautionary Statements Regarding Forward-Looking Information:
This announcement 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," and other words referring to events that may occur in the future. These statements reflect the Company'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 emissions that adversely affect programs like the U.S. government's renewable fuel standard, low carbon fuel standards 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, bovine spongiform encephalopathy ("BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere, such as the recent African Swine Fever ("ASF") outbreak in China; 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, 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 Diamond Green Diesel joint venture, including possible unanticipated operating disruptions and issues relating to the announced expansion project; 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 the Company's information systems or failure to implement new systems and software successfully, including the Company's ongoing enterprise resource planning project; 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 likely 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 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. Other risks and uncertainties regarding the Company, 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. The Company 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.
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-cash-tender-offer-for-any-and-all-5-375-senior-notes-due-2022--300819387.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, March 27, 2019 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) ("Darling" or the "Company") today announced that it has launched an offering of $500 million in aggregate principal amount of its unsecured senior notes (the "Notes"). The Notes will initially be guaranteed by all of the Company's restricted subsidiaries, other than foreign subsidiaries, that are borrowers under or that guarantee the Company's senior secured credit facilities under its Second Amended and Restated Credit Agreement dated January 6, 2014, as amended. The offering is subject to market and other conditions.
The gross proceeds of the Notes offering, together with cash on hand, are expected to be used to refinance all of the Company's 5.375% Senior Notes due 2022 by cash tender offer for those notes, and, if and to the extent necessary, redemption of those notes, and to pay any applicable premiums for the refinancing, to pay the discount of the initial purchasers of the Notes and to pay the other fees and expenses related to the offering of the Notes.
The Notes will be offered in the United States to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside the United States to non‑U.S. persons in reliance on Regulation S under the Securities Act. The Notes will not be registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws.
This media release shall not constitute an offer to sell or the solicitation of an offer to buy the Notes, nor shall there be any offer to sell, solicitation of an offer to buy or sale of the Notes, in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as collagen, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients.
Cautionary Statements Regarding Forward‑Looking Information:
This announcement 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," and other words referring to events that may occur in the future. These statements reflect the Company'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 emissions that adversely affect programs like the U.S. government's renewable fuel standard, low carbon fuel standards 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, bovine spongiform encephalopathy ("BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere, such as the recent African Swine Fever ("ASF") outbreak in China; 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, 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 Diamond Green Diesel joint venture, including possible unanticipated operating disruptions and issues relating to the announced expansion project; 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 the Company's information systems or failure to implement new systems and software successfully, including the Company's ongoing enterprise resource planning project; 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 likely 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 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. Other risks and uncertainties regarding the Company, 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. The Company 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:
Melissa A. Gaither, VP IR and Global Communications
Email: mgaither@darlingii.com
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038
Phone: 972‑281-4478
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-private-offering-of-500-million-of-unsecured-senior-notes-300819385.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Feb. 21, 2019 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) will hold a conference call and webcast on Thursday, February 28, 2019 to discuss the Company's fourth quarter and year end 2018 financial results. The teleconference will begin at 8:30 a.m. ET and will be hosted by Mr. Randall Stuewe, CEO and Chairman of the Board, and Mr. Brad Phillips, EVP and Chief Financial Officer. Additionally, the Company will have a slide presentation available to augment management's formal remarks, which will be accessible via the investor relations section of the Company's website. The related press release will be issued after the market closes on February 27, 2019.
Due to historically high call volume, the company is offering participants the opportunity to register in advance for the conference through the following link: http://dpregister.com/10128432.
Registered participants will receive an email with a calendar reminder and a dial-in number and PIN that will allow them immediate access to the call on February 28, 2019.
Participants who do not wish to pre-register for the call may dial in using 844-868-8847 (U.S. callers), or 412-317-6593 (international callers), and ask for the "Darling Ingredients" call. A replay will be available two hours after completion of the call through March 7, 2019. To access the replay, please dial 877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 412-317-0088 (international callers) and reference passcode 10128432. The live webcast and archived replay also can be accessed on the Company's web site at http://ir.darlingii.com.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, nutraceutical, food, pet food, feed, industrial, fuel, bioenergy and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments and disposal services for waste solids from the wastewater treatment systems of industrial food processing plants. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
For More Information, contact: | |
Melissa A. Gaither, VP Investor Relations | 251 O'Connor Ridge Blvd., Suite 300 |
& Global Communications | Irving, Texas 75038 |
Phone: 972-717-0300 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-fourth-quarter-and-year-end-2018-earnings-conference-call-and-webcast-300800064.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Dec. 17, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) announces the opening on January 2, 2019, of its second organic fertilizer production facility in Turlock, CA. The new state-of-the-art facility is located on a 21-acre site and will have the ability to annually produce 35,000 tons of Nature Safe Natural & Organic Fertilizer®. The new plant will also provide 4,500 tons of storage capacity to meet the needs of organic growers operating in California and the entire western region of the United States. Darling has operated Nature Safe out of its original Henderson, Kentucky plant since the early 1990's, where it will continue to produce its premium fertilizer for customers in the rest of the country. The strength of the organic fertilizer market in the western U.S. has Nature Safe already working on plans to double the new Turlock plant's production capacity by end of year 2019.
Mike Manning, Darling's Vice President of Organic Fertilizer and Innovation, states that recently the company has become focused on a growth strategy in California where it could leverage Darling's diverse supply of animal feed ingredients. With long-established rendering facilities in Los Angeles, San Francisco, Fresno and Turlock that produce feather meal, blood meal, and meat & bone meal, the company's Nature Safe brand is able to produce the highest quality organic fertilizers on the market with cost-effective proficiency.
When the new Turlock plant begins production in January, it will bring on a new management team. Dan Rodriguez, West Regional Commercial Business Manager, will develop Nature Safe's go-to-market strategies. Kevin Van Dewark has joined Darling Ingredients as Plant Manager for the new Turlock fertilizer plant, and Mayra Pena will be its new Office Manager.
Darling Ingredients is a global leader in the production of sustainable natural ingredients from edible and inedible bio-nutrients used by the food, feed, pharmaceutical, pet food, fertilizer and fuel markets. Nature Safe is the company's organic fertilizer brand serving customers throughout the U.S.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients, and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally. For additional information, visit the Company's website at http://www.darlingii.com.
Contact:
Rick Geise, Director, Fertilizer Division
859-572-2558
rgeise@darlingii.com
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-opens-new-nature-safe-organic-fertilizer-plant-in-turlock-ca-300765905.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Nov. 6, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR), a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy, and fertilizer industries, today announced financial results for the 2018 third quarter ended September 29, 2018.
Third Quarter 2018 Overview
For the third quarter of 2018, the Company reported net sales of $812.6 million, as compared with net sales of $936.3 million for the third quarter of 2017. The $123.7 million reduction in net sales resulted mainly from lower finished product pricing and extended DGD downtime, the deconsolidation of the Company's Best Hides subsidiary in 2018, billed freight recorded in cost of sales in 2018 as compared to net sales in 2017 and the divestiture of the Company's industrial residuals business in May 2018. Net loss attributable to Darling for the three months ended September 29, 2018 was $(6.0) million, or $(0.04) per diluted share, compared to a net income of $7.8 million, or $0.05 per diluted share, for the third quarter of 2017. The net loss for the third quarter 2018 reflects lower finished product selling prices and an increase in cost of sales from inventory write downs of approximately $7.2 million in China relating to lower market values due to the African Swine Fever (ASF) outbreak.
The Darling Ingredients Board also approved an increase in the Company's previously announced share repurchase program from $100 million to $200 million and extended the term of the program for an additional year to August 13, 2020, to be exercised depending on market conditions. The repurchases may be made from time to time on the open market at prevailing market prices or in negotiated transactions off the market. Repurchases may occur over the authorized period unless extended or shortened by the Board of Directors.
Comments on the Third Quarter 2018
"We clearly delivered lower than expected results in third quarter. Extended downtime at DGD largely influenced our financial results and reshuffling our supply chain for fats and used cooking oil impacted our feed segment results. Additionally, trade disputes with China, record global grain stocks and a stronger U.S. dollar weighed on our finished product pricing," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "The silver lining is we had record raw material volumes globally and now DGD is fully operational, and we expect to produce 65-70 million gallons of renewable diesel in the fourth quarter with spot margins in excess of $1.25 per gallon."
"Feed segment results were largely impacted by a lower pricing environment and the deflationary lag in our U.S. raw material formulas combined with an inventory write down of Chinese plasma related to ASF. Food segment results improved sequentially and delivered consistent year-over-year results with solid performance from our Rousselot collagen platform and higher sales volumes in China," stated Mr. Stuewe.
"In the Fuel segment, strong volumes supported improved performance across Europe and offset slightly weaker results in North American biodiesel due to lower RIN pricing and the absence of the Blenders Tax Credit (BTC). We remain optimistic that the BTC will re-instate late in the fourth quarter 2018."
"We continue to act on our World of Growth strategy to grow our core business and closed on the acquisition of Arkansas-based Triple – T Foods in early October. The acquisition, which includes both cold storage and a wet pet food operation, further expands our premium protein business in the growing specialty pet food industry. We are also excited to announce board approval for the Phase III Super Diamond expansion to 675 million annual gallons of renewable diesel with the construction of a second independent parallel plant. Additionally, the project will include the construction of a new renewable Naphtha, or green gasoline, plant and improved logistics capability. The estimated cost for the entire project is approximately $1.1 billion with completion expected in the fourth quarter of 2021. This capital cost is expected to be funded from cash generated by DGD's operations. Margins remain attractive, and we look forward to meeting the increased demands for sustainable low carbon fuel and capturing higher LCFS margins from our increased capacity," concluded Mr. Stuewe.
Operational Update by Segment
Financial Update by Segment
Feed Ingredients | Three Months Ended | Nine Months Ended | |||
($ thousands) | September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | |
Net sales (1) | $ 482,744 | $ 575,543 | $ 1,467,365 | $ 1,677,286 | |
Selling, general and administrative expenses | 39,702 | 44,841 | 131,914 | 132,553 | |
Depreciation and amortization | 47,321 | 46,860 | 140,933 | 134,933 | |
Segment operating income | 11,875 | 34,268 | 70,796 | 105,448 | |
Adjusted EBITDA (2) | $ 59,196 | $ 81,128 | $ 211,729 | $ 240,381 |
(1) 2018 includes revenue recognition reclass for billed freight moved to cost of sales per new revenue standard | ||
(2) Adjusted EBITDA calculated by adding depreciation and amortization to segment operating income |
Food Ingredients | Three Months Ended | Nine Months Ended | |||
($ thousands) | September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | |
Net sales (1) | $ 265,208 | $ 298,863 | $ 847,457 | $ 843,498 | |
Selling, general and administrative expenses | 21,843 | 25,556 | 67,894 | 77,236 | |
Restructuring and impairment charges | - | - | 14,965 | - | |
Depreciation and amortization | 19,697 | 19,506 | 60,725 | 55,291 | |
Segment operating income | 12,971 | 15,107 | 19,155 | 40,523 | |
Adjusted EBITDA (2) | $ 32,668 | $ 34,613 | $ 94,845 | $ 95,814 |
(1) 2018 includes revenue recognition reclass for billed freight moved to cost of sales per new revenue standard | ||||
(2) Adjusted EBITDA calculated by adding depreciation and amortization and restructuring and impairment charges to segment operating income |
Fuel Ingredients | Three Months Ended | Nine Months Ended | |||
($ thousands) | September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | |
Net sales (1) | $ 64,624 | $ 61,856 | $ 219,774 | $ 188,918 | |
Selling, general and administrative expenses | (2,822) | (488) | (4,056) | 5,648 | |
Depreciation and amortization | 9,370 | 7,912 | 26,378 | 22,472 | |
Segment operating income | 4,518 | 189 | 26,691 | 5,877 | |
Adjusted EBITDA (2) | $ 13,888 | $ 8,101 | $ 53,069 | $ 28,349 |
(1) 2018 includes revenue recognition reclass for billed freight moved to cost of sales per new revenue standard | ||
(2) Adjusted EBITDA calculated by adding depreciation and amortization to segment operating income | ||
Fuel Ingredients Segment results shown do not include the Diamond Green Diesel (DGD) 50% Joint Venture |
Darling Ingredients Inc. and Subsidiaries | |||||||||||||
Consolidated Operating Results | |||||||||||||
For the Periods Ended September 29, 2018 and September 30, 2017 | |||||||||||||
(in thousands, except per share data) | |||||||||||||
(unaudited) | |||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||
$ Change | $ Change | ||||||||||||
September 29, | September 30, | Favorable | September 29, | September 30, | Favorable | ||||||||
2018 | 2017 | (Unfavorable) | 2018 | 2017 | (Unfavorable) | ||||||||
Net sales | $ 812,576 | $ 936,262 | $ (123,686) | $ 2,534,596 | $ 2,709,702 | $ (175,106) | |||||||
Costs and expenses: | |||||||||||||
Cost of sales and operating expenses | 648,101 | 742,511 | 94,410 | 1,979,201 | 2,129,721 | 150,520 | |||||||
Selling, general and administrative expenses | 67,447 | 82,153 | 14,706 | 232,907 | 253,608 | 20,701 | |||||||
Restructuring and impairment charges | - | - | - | 14,965 | - | (14,965) | |||||||
Depreciation and amortization | 78,842 | 77,202 | (1,640) | 235,915 | 221,306 | (14,609) | |||||||
Total costs and expenses | 794,390 | 901,866 | 107,476 | 2,462,988 | 2,604,635 | 141,647 | |||||||
Operating income | 18,186 | 34,396 | (16,210) | 71,608 | 105,067 | (33,459) | |||||||
Other expense: | |||||||||||||
Interest expense | (20,080) | (22,531) | 2,451 | (66,220) | (66,657) | 437 | |||||||
Debt extinguishment costs | - | - | - | (23,509) | - | (23,509) | |||||||
Foreign currency loss | (2,106) | (2,055) | (51) | (7,082) | (4,430) | (2,652) | |||||||
Gain/(loss) on disposal of subsidiaries | 3,038 | - | 3,038 | (12,500) | - | (12,500) | |||||||
Other expense, net | (2,786) | (2,533) | (253) | (4,103) | (8,383) | 4,280 | |||||||
Total other expense | (21,934) | (27,119) | 5,185 | (113,414) | (79,470) | (33,944) | |||||||
Equity in net income/(loss) of unconsolidated subsidiaries | (2,792) | 7,703 | (10,495) | 109,598 | 16,669 | 92,929 | |||||||
Income/(loss) before income taxes | (6,540) | 14,980 | (21,520) | 67,792 | 42,266 | 25,526 | |||||||
Income tax expense/(benefit) | (1,403) | 6,296 | 7,699 | 3,992 | 15,856 | 11,864 | |||||||
Net income/(loss) | (5,137) | 8,684 | (13,821) | 63,800 | 26,410 | 37,390 | |||||||
Net income attributable to noncontrolling interests | (900) | (923) | 23 | (2,952) | (3,671) | 719 | |||||||
Net income/(loss) attributable to Darling | $ (6,037) | $ 7,761 | $ (13,798) | $ 60,848 | $ 22,739 | $ 38,109 | |||||||
Basic income/(loss) per share: | $ (0.04) | $ 0.05 | $ (0.09) | $ 0.37 | $ 0.14 | $ 0.23 | |||||||
Diluted income/(loss) per share: | $ (0.04) | $ 0.05 | $ (0.09) | $ 0.37 | $ 0.14 | $ 0.23 | |||||||
Number of diluted common shares | 164,656 | 167,181 | 165,774 | 166,628 |
Darling Ingredients Inc. and Subsidiaries | ||||
Condensed Consolidated Balance Sheets | ||||
September 29, 2018 and December 30, 2017 | ||||
(in thousands) | ||||
September 29, | December 30, | |||
2018 | 2017 | |||
ASSETS | (unaudited) | |||
Current assets: | ||||
Cash and cash equivalents | $ 81,470 | $ 106,774 | ||
Restricted cash | 103 | 142 | ||
Accounts receivable, net | 363,312 | 391,847 | ||
Inventories | 361,679 | 358,183 | ||
Prepaid expenses | 43,305 | 38,326 | ||
Income taxes refundable | 8,356 | 4,509 | ||
Other current assets | 20,253 | 56,664 | ||
Total current assets | 878,478 | 956,445 | ||
Property, plant and equipment, less accumulated depreciation, net | 1,631,036 | 1,645,822 | ||
Intangible assets, less accumulated amortization, net | 593,234 | 676,500 | ||
Goodwill | 1,233,545 | 1,301,093 | ||
Investment in unconsolidated subsidiaries | 398,794 | 302,038 | ||
Other assets | 54,574 | 62,284 | ||
Deferred income taxes | 15,550 | 14,043 | ||
Total assets | $ 4,805,211 | $ 4,958,225 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Current portion of long-term debt | $ 11,100 | $ 16,143 | ||
Accounts payable, principally trade | 177,769 | 217,417 | ||
Income taxes payable | 5,906 | 12,300 | ||
Accrued expenses | 291,056 | 313,623 | ||
Total current liabilities | 485,831 | 559,483 | ||
Long-term debt, net of current portion | 1,668,129 | 1,698,050 | ||
Other non-current liabilities | 101,878 | 106,287 | ||
Deferred income taxes | 234,070 | 266,708 | ||
Total liabilities | 2,489,908 | 2,630,528 | ||
Commitments and contingencies | ||||
Total Darling's stockholders' equity | 2,254,442 | 2,244,933 | ||
Noncontrolling interests | 60,861 | 82,764 | ||
Total stockholders' equity | $ 2,315,303 | $ 2,327,697 | ||
$ 4,805,211 | $ 4,958,225 |
Darling Ingredients Inc. and Subsidiaries | ||||||
Consolidated Statement of Cash Flows | ||||||
Nine Months Ended September 29, 2018 and September 30, 2017 | ||||||
(in thousands) | ||||||
(unaudited) | ||||||
Nine Months Ended | ||||||
September 29, | September 30, | |||||
Cash flows from operating activities: | 2018 | 2017 | ||||
Net income | $ 63,800 | $ 26,410 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||
Depreciation and amortization | 235,915 | 221,306 | ||||
Loss/(gain) on disposal of property, plant, equipment and other assets | 472 | (537) | ||||
Loss on disposal of subsidiary | 12,500 | - | ||||
Asset impairment | 2,907 | - | ||||
Gain on insurance proceeds from insurance settlements | (1,253) | - | ||||
Deferred taxes | (15,708) | (14,242) | ||||
Increase/(decrease) in long-term pension liability | (375) | 1,574 | ||||
Stock-based compensation expense | 13,606 | 14,710 | ||||
Write-off deferred loan costs | 8,163 | 443 | ||||
Deferred loan cost amortization | 6,265 | 6,581 | ||||
Equity in net income of unconsolidated subsidiaries | (109,598) | (16,669) | ||||
Distribution of earnings from unconsolidated subsidiaries | 27,418 | 26,600 | ||||
Changes in operating assets and liabilities, net of effects from acquisitions: | ||||||
Accounts receivable | 9,657 | (5,311) | ||||
Income taxes refundable/payable | (9,838) | 18,332 | ||||
Inventories and prepaid expenses | (25,960) | (31,058) | ||||
Accounts payable and accrued expenses | (23,004) | 39,937 | ||||
Other | 4,731 | (19,305) | ||||
Net cash provided by operating activities | 199,698 | 268,771 | ||||
Cash flows from investing activities: | ||||||
Capital expenditures | (213,726) | (196,446) | ||||
Acquisitions, net of cash acquired | (51,301) | (12,144) | ||||
Investment of unconsolidated subsidiaries | (10,000) | (4,750) | ||||
Proceeds from sale of investment in subsidiaries | 82,805 | - | ||||
Gross proceeds from disposal of property, plant and equipment and other assets | 3,361 | 4,953 | ||||
Proceeds from insurance settlement | 1,253 | 3,301 | ||||
Payments related to routes and other intangibles | (1,253) | (5,635) | ||||
Net cash used by investing activities | (188,861) | (210,721) | ||||
Cash flows from financing activities: | ||||||
Proceeds from long-term debt | 623,698 | 24,069 | ||||
Payments on long-term debt | (661,268) | (94,250) | ||||
Borrowings from revolving credit facility | 386,436 | 142,000 | ||||
Payments on revolving credit facility | (362,463) | (147,327) | ||||
Net cash overdraft financing | 3,361 | 2,590 | ||||
Deferred loan costs | (9,668) | (1,177) | ||||
Issuance of common stock | 182 | 22 | ||||
Minimum withholding taxes paid on stock awards | (2,215) | (2,140) | ||||
Acquisition of noncontrolling interest | - | (429) | ||||
Distributions to noncontrolling interests | (8,005) | (2,513) | ||||
Net cash used by financing activities | (29,942) | (79,155) | ||||
Effect of exchange rate changes on cash | (6,238) | 16,676 | ||||
Net increase/(decrease) in cash, cash equivalents and restricted cash | (25,343) | (4,429) | ||||
Cash, cash equivalents and restricted cash at beginning of period | 106,916 | 114,857 | ||||
Cash, cash equivalents and restricted cash at end of period | $ 81,573 | $ 110,428 | ||||
Supplemental disclosure of cash flow information: | ||||||
Accrued capital expenditures | $ (5,295) | $ (3,532) | ||||
Cash paid during the period for: | ||||||
Interest, net of capitalized interest | $ 58,731 | $ (58,219) | ||||
Income taxes, net of refunds | $ 28,682 | $ 13,719 | ||||
Non-cash financing activities: | ||||||
Debt issued for assets | $ 24 | $ 3 |
Selected financial information for the Company's Diamond Green Diesel Joint Venture is as follows:
Diamond Green Diesel Joint Venture | ||||||
Condensed Consolidated Balance Sheets | ||||||
September 30, 2018 and December 31, 2017 | ||||||
(in thousands) | ||||||
September 30, | December 31, | |||||
2018 | 2017 | |||||
Assets: | (unaudited) | |||||
Total current assets | $ 178,875 | $ 202,778 | ||||
Property, plant and equipment, net | 567,092 | 435,328 | ||||
Other assets | 26,949 | 4,655 | ||||
Total assets | $ 772,916 | $ 642,761 | ||||
Liabilities and members' equity: | ||||||
Total current portion of long term debt | $ 182 | $ 17,023 | ||||
Total other current liabilities | 46,502 | 40,705 | ||||
Total long term debt | 8,535 | 36,730 | ||||
Total other long term liabilities | 533 | 450 | ||||
Total members' equity | 717,164 | 547,853 | ||||
Total liabilities and members' equity | $ 772,916 | $ 642,761 |
Diamond Green Diesel Joint Venture | ||||||||||||||
Operating Financial Results | ||||||||||||||
Three Months and Nine Months Ended September 30, 2018 and September 30, 2017 | ||||||||||||||
(in thousands) | ||||||||||||||
(unaudited) | ||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||
$ Change | $ Change | |||||||||||||
September 30, | September 30, | Favorable | September 30, | September 30, | Favorable | |||||||||
Revenues: | 2018 | 2017 | (Unfavorable) | 2018 | 2017 | (Unfavorable) | ||||||||
Operating revenues | $ 104,811 | $ 175,585 | $ (70,774) | $ 407,121 | $ 451,768 | $ (44,647) | ||||||||
Expenses: | ||||||||||||||
Total costs and expenses less depreciation, amortization and accretion expense | ||||||||||||||
103,794 | 154,446 | 50,652 | 169,632 | 395,743 | 226,111 | |||||||||
Depreciation, amortization and accretion expense | ||||||||||||||
6,516 | 6,733 | 217 | 18,890 | 22,867 | 3,977 | |||||||||
Total costs and expenses | 110,310 | 161,179 | 50,869 | 188,522 | 418,610 | 230,088 | ||||||||
Operating income /(loss) | (5,499) | 14,406 | (19,905) | 218,599 | 33,158 | 185,441 | ||||||||
Other income | 556 | 408 | 148 | 1,348 | 959 | 389 | ||||||||
Interest and debt expense, net | (318) | (455) | 137 | (637) | (2,306) | 1,669 | ||||||||
Net income/(loss) | $ (5,261) | $ 14,359 | $ (19,620) | $ 219,310 | $ 31,811 | $ 187,499 |
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 | ||||||||
Three and nine months ended September 29, 2018 and September 30, 2017 | ||||||||
Three Months Ended - Year over Year | Nine Months Ended - Year over Year | |||||||
Adjusted EBITDA | September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||
(U.S. dollars in thousands) | ||||||||
Net income/(loss) attributable to Darling | $ (6,037) | $ 7,761 | $ 60,848 | $ 22,739 | ||||
Depreciation and amortization | 78,842 | 77,202 | 235,915 | 221,306 | ||||
Interest expense | 20,080 | 22,531 | 66,220 | 66,657 | ||||
Income tax expense/(benefit) | (1,403) | 6,296 | 3,992 | 15,856 | ||||
Restructuring and impairment charges | - | - | 14,965 | - | ||||
Foreign currency loss | 2,106 | 2,055 | 7,082 | 4,430 | ||||
Other expense, net | 2,786 | 2,533 | 4,103 | 8,383 | ||||
Debt extinguishment costs | - | - | 23,509 | - | ||||
Loss/(Gain) on disposal of subsidiary | (3,038) | - | 12,500 | - | ||||
Equity in net (income)/loss of unconsolidated subsidiaries | 2,792 | (7,703) | (109,598) | (16,669) | ||||
Net income attributable to noncontrolling interests | 900 | 923 | 2,952 | 3,671 | ||||
Adjusted EBITDA | $ 97,028 | $ 111,598 | $ 322,488 | $ 326,373 | ||||
Foreign currency exchange impact (1) | 1,055 | - | (10,844) | - | ||||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) | $ 98,083 | $ 111,598 | $ 311,644 | $ 326,373 | ||||
DGD Joint Venture Adjusted EBITDA (Darling's share) | $ 509 | $ 10,570 | $ 118,745 | $ 28,013 |
(1) | The average rates assumption used in the calculation was the actual fiscal average rate for the three months ended September 29, 2018 of €1.00:USD$1.16 and CAD$1.00:USD$0.76 as compared to the average rate for the three months ended September 30, 2017 of €1.00:USD$1.18 and CAD$1.00:USD$0.80, respectively. The average rates assumption used in the calculation was the actual fiscal average rate for the nine months ended September 29, 2018 of €1.00:USD$1.20 and CAD$1.00:USD$0.78 as compared to the average rate for the nine months ended September 30, 2017 of €1.00:USD$1.11 and CAD$1.00:USD$0.77, respectively. |
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients, and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. 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 third quarter 2018 financial results at 8:30 am Eastern Time (7:30 am Central Time) on Wednesday, November 7, 2018. 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 10125255. 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 November 15, 2018, by dialing 1-877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 1-412-317-0088 (international callers). The access code for the replay is 10125255. 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 expenses, 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.
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 and 5.375% Notes and 3.625% Notes that were outstanding at September 29, 2018. 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 and 5.375% 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.
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," 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 Unites 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"), 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 recent African Swine Fever ("ASF") outbreak in China; 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, 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 project; 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, including our ongoing enterprise resource planning project; 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 likely 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 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: | |
Melissa A. Gaither, VP IR and Global Communications | Email : mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038 | Phone : 972-717-0300 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-reports-third-quarter-2018-financial-results-300745070.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Nov. 6, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) today announced the appointment of Nicole M. Ringenberg to its Board of Directors and as a member of its Audit Committee. Ms. Ringenberg joins the Board as an independent director, and her appointment is effective immediately. The appointment of Ms. Ringenberg will expand the total number of directors to eleven.
Ms. Ringenberg recently retired following a 32-year career with Monsanto Company, a Fortune 200 company and one of the world's leading providers of sustainable agricultural solutions, where she most recently served as Vice President and Controller. Prior to that, she served in a number of different roles at Monsanto, including Vice President, Global Commercial Operations and Finance and CEO of Asia Pacific.
"We are excited to add Nicole Ringenberg to our Board. She brings an incredible resume and a robust skill set. Her global experience base will help support our World of Growth strategy." said Randall C. Stuewe, Chairman and CEO of Darling Ingredients.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients, and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
Darling Ingredients contact | |
Melissa A. Gaither, VP IR and Global Communications | Email : mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038 | Phone : 972-281-4478 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-new-appointment-to-board-of-directors-300743863.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Oct. 2, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) today announced that Diamond Green Diesel ("DGD"), a joint venture with Valero Energy Corporation (NYSE: VLO), resumed production at its Norco, LA, facility. DGD recently expanded its annual capacity from 160 million gallons to 275 million gallons of renewable diesel.
Darling Ingredients will also host its 2018 Analyst-Investor Forum, where management will provide a global business overview, on Thursday, October 11, 2018, in New Orleans, LA. Attendance is by invitation only. A live webcast of management's remarks is scheduled at 1:00 pm CT and can be accessed via the Investors section of the Company's website at www.darlingii.com.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, nutraceutical, food, pet food, feed, industrial, fuel, bioenergy and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments and disposal services for waste solids from the wastewater treatment systems of industrial food processing plants. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
For More Information, contact: | 251 O'Connor Ridge Blvd., Suite 300 |
Melissa A. Gaither, VP Investor Relations | Irving, Texas 75038 |
& Global Communications | Phone: 972-717-0300 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-diamond-green-diesel-completes-turnaround-and-darling-management-hosts-analyst-investor-forum-webcast-300723132.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Sept. 18, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) reported today that the Diamond Green Diesel ("DGD") facility in Norco, LA, which is a joint venture with a subsidiary of Valero Energy Corporation (NYSE: VLO) ("Valero"), will be taking downtime from September 21, 2018 until approximately October 1, 2018 to replace a catalyst that was damaged during start-up of the facility, which was expanded from 160 million gallons to 275 million gallons per year of renewable diesel capacity. The issue that caused the damage to the catalyst was identified and remedied.
"Diamond Green Diesel took longer downtime with the turnaround than expected and coupled with the scheduled September replacement of the catalyst, total production gallons will be lower in the 3rd quarter than had been projected," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "Once back on line, we are confident DGD will be able to quickly achieve the annual rated capacity of 275 million gallons," stated Mr. Stuewe.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients, and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
About Valero
Valero Energy Corporation, through its subsidiaries, is an international manufacturer and marketer of transportation fuels and other petrochemical products. Valero, a Fortune 50 company based in San Antonio, Texas, with approximately 10,000 employees, is an independent petroleum refiner and ethanol producer, and its assets include 15 petroleum refineries with a combined throughput capacity of approximately 3.1 million barrels per day and 11 ethanol plants with a combined production capacity of 1.45 billion gallons per year. The petroleum refineries are located in the United States (U.S.), Canada and the United Kingdom (U.K.), and the ethanol plants are located in the Mid-Continent region of the U.S. In addition, Valero owns the 2 percent general partner interest and a majority limited partner interest in Valero Energy Partners LP, a midstream master limited partnership. Valero sells its products in both the wholesale rack and bulk markets, and approximately 7,400 outlets carry Valero's brand names in the U.S., Canada, the U.K. and Ireland. Please visit www.valero.com for more information.
Darling Ingredients contact | |
Melissa A. Gaither, VP IR and Global Communications | Email : mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038 | Phone : 972-281-4478 |
Valero Contacts | |
Investors: | |
John Locke, Vice President – Investor Relations, 210-345-3077 | |
Karen Ngo, Senior Manager – Investor Relations, 210-345-4574 | |
Tom Mahrer, Manager – Investor Relations, 210-345-1953 | |
Media: | |
Lillian Riojas, Director – Media Relations and Communications, 210-345-5002 |
Cautionary Statements Regarding Forward-Looking Information:
{This media release contains "forward-looking" statements regarding the business operations and prospects of Darling Ingredients Inc., including its Diamond Green Diesel (DGD) joint venture, 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," "assumption," 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, changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs like the Renewable Fuel Standards Program (RFS2), low carbon fuel standards (LCFS) and tax credits for biofuels both in the Unites States and abroad; and risks associated with the DGD renewable diesel plant in Norco, Louisiana, including possible unanticipated operating disruptions and issues related to the announced expansion project including, the statements regarding the proposed timetable for resumption of full production (which are based on the best estimates currently available). 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.}
View original content:http://www.prnewswire.com/news-releases/update-on-diamond-green-diesel-expansion-progress-300713016.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Aug. 8, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR), a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy, and fertilizer industries, today announced financial results for the 2018 second quarter ended June 30, 2018.
Second Quarter 2018 Overview
For the second quarter of 2018, the Company reported net sales of $846.6 million, as compared with net sales of $894.9 million for the second quarter of 2017. The reduction in net sales resulted from the reclass of billed freight per new revenue standard and the deconsolidation of the Company's Best Hides subsidiary. Net loss attributable to Darling for the three months ended June 30, 2018 was $(30.4) million, or $(0.18) per diluted share, compared to a net income of $9.1 million, or $0.05 per diluted share, for the second quarter of 2017. The net loss for the second quarter 2018 reflects debt extinguishment costs of $23.5 million related to Euro bond refinancing, a loss of $15.5 million from the sale of Terra Renewal Services subsidiary, and $15.0 million of restructuring and impairment charges incurred as result of the Hurlingham, Argentina, gelatin plant closure. Excluding these items, adjusted net income for the second quarter 2018 was $17.7 million or $0.11 cents per share.
Comments on the Second Quarter 2018
"Operationally we had a solid second quarter. Performance improved sequentially and year-over-year, and we took several strategic actions to strengthen our portfolio and position the company for future growth," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "Strong slaughter activity drove global tonnage up 4.0 percent, and our expansion projects and recent acquisitions contributed as expected. The feed segment delivered much improved results across our geographies with improved raw material volumes and widening margins."
"Food segment results reflect the closure of our gelatin operation in Argentina due to ongoing macroeconomic headwinds and redeployment of production to our other gelatin locations. The facility represented approximately 3 percent of the Food segment sales, and we are now filling orders for most high-margin customers from other Rousselot facilities. This strategic realignment will optimize our gelatin assets and better leverage our existing Rousselot system," stated Mr. Stuewe.
"In the Fuel segment, operational efficiencies and favorable pricing generated consistent performance when adjusted for the 2017 Blenders Tax Credit (BTC) received in the first quarter. We remain optimistic the BTC will once again be made retroactive for 2018."
"Diamond Green Diesel, our 50/50 joint venture with Valero to produce a premium low-carbon fuel additive, has now completed construction on the expansion from 160 million gallons to 275 million gallons annually. We are in the early stages of commissioning and anticipate being on line mid-August. Spot margins remain attractive and we look forward to the significant contribution this facility is expected to bring Darling," concluded Mr. Stuewe.
Operational Update by Segment
Financial Update by Segment
Feed Ingredients |
Three Months Ended |
Six Months Ended | ||||
($ thousands) |
June 30, 2018 |
July 1, 2017 |
June 30, 2018 |
July 1, 2017 | ||
Net sales (1) |
$ 498,823 |
$ 549,119 |
$ 984,621 |
$ 1,101,743 | ||
Selling, general and administrative expenses |
43,947 |
42,875 |
92,212 |
87,712 | ||
Depreciation and amortization |
46,823 |
44,354 |
93,612 |
88,073 | ||
Segment operating income |
37,265 |
39,688 |
58,921 |
71,180 | ||
Adjusted EBITDA (2) |
$ 84,088 |
$ 84,042 |
$ 152,533 |
$ 159,253 |
(1) Includes revenue recognition reclass for billed freight moved to cost of sales per new revenue standard | ||||||
(2) Adjusted EBITDA calculated by adding depreciation and amortization to segment operating income |
Food Ingredients |
Three Months Ended |
Six Months Ended | ||||
($ thousands) |
June 30, 2018 |
July 1, 2017 |
June 30, 2018 |
July 1, 2017 | ||
Net sales (1) |
$ 276,729 |
$ 278,409 |
$ 582,249 |
$ 544,635 | ||
Selling, general and administrative expenses |
22,190 |
26,703 |
46,051 |
51,680 | ||
Restructuring and impairment charges |
14,965 |
- |
14,965 |
- | ||
Depreciation and amortization |
20,388 |
18,184 |
41,028 |
35,785 | ||
Segment operating income/(loss) |
(5,650) |
11,160 |
6,184 |
25,416 | ||
Adjusted EBITDA (2) |
$ 29,703 |
$ 29,344 |
$ 62,177 |
$ 61,201 |
(1) Includes revenue recognition reclass for billed freight moved to cost of sales per new revenue standard | ||||||
(2) Adjusted EBITDA calculated by adding depreciation and amortization and restructuring and impairment charges to segment operating income |
Fuel Ingredients |
Three Months Ended |
Six Months Ended | ||||
($ thousands) |
June 30, 2018 |
July 1, 2017 |
June 30, 2018 |
July 1, 2017 | ||
Net sales (1) |
$ 71,094 |
$ 67,402 |
$ 155,150 |
$ 127,062 | ||
Selling, general and administrative expenses |
164 |
2,873 |
(1,234) |
6,136 | ||
Depreciation and amortization |
8,537 |
7,715 |
17,008 |
14,560 | ||
Segment operating income |
5,016 |
2,134 |
22,173 |
5,688 | ||
Adjusted EBITDA (2) |
$ 13,553 |
$ 9,849 |
$ 39,181 |
$ 20,248 |
(1) Includes revenue recognition reclass for billed freight moved to cost of sales per new revenue standard | ||||||
(2) Adjusted EBITDA calculated by adding depreciation and amortization to segment operating income | ||||||
Fuel Ingredients Segment results shown do not include the Diamond Green Diesel (DGD) 50% Joint Venture |
Darling Ingredients Inc. and Subsidiaries | |||||||||||||
Consolidated Operating Results | |||||||||||||
For the Periods Ended June 30, 2018 and July 1, 2017 | |||||||||||||
(in thousands, except per share data) | |||||||||||||
(unaudited) | |||||||||||||
Three Months Ended |
Six Months Ended | ||||||||||||
$ Change |
$ Change | ||||||||||||
June 30, |
July 1, |
Favorable |
June 30, |
July 1, |
Favorable | ||||||||
2018 |
2017 |
(Unfavorable) |
2018 |
2017 |
(Unfavorable) | ||||||||
Net sales |
$ 846,646 |
$ 894,930 |
$ (48,284) |
$ 1,722,020 |
$ 1,773,440 |
$ (51,420) | |||||||
Costs and expenses: |
|||||||||||||
Cost of sales and operating expenses |
653,001 |
699,244 |
46,243 |
1,331,100 |
1,387,210 |
56,110 | |||||||
Selling, general and administrative expenses |
78,558 |
84,532 |
5,974 |
165,460 |
171,455 |
5,995 | |||||||
Restructuring and impairment charges |
14,965 |
- |
(14,965) |
14,965 |
- |
(14,965) | |||||||
Depreciation and amortization |
78,454 |
72,990 |
(5,464) |
157,073 |
144,104 |
(12,969) | |||||||
Total costs and expenses |
824,978 |
856,766 |
31,788 |
1,668,598 |
1,702,769 |
34,171 | |||||||
Operating income |
21,668 |
38,164 |
(16,496) |
53,422 |
70,671 |
(17,249) | |||||||
Other expense: |
|||||||||||||
Interest expense |
(23,016) |
(22,446) |
(570) |
(46,140) |
(44,126) |
(2,014) | |||||||
Debt extinguishment costs |
(23,509) |
- |
(23,509) |
(23,509) |
- |
(23,509) | |||||||
Foreign currency loss |
(3,495) |
(2,111) |
(1,384) |
(4,976) |
(2,375) |
(2,601) | |||||||
Loss on sale of subsidiary |
(15,538) |
- |
(15,538) |
(15,538) |
- |
(15,538) | |||||||
Other (expense)/gain, net |
1,199 |
(3,797) |
4,996 |
(1,317) |
(5,850) |
4,533 | |||||||
Total other expense |
(64,359) |
(28,354) |
(36,005) |
(91,480) |
(52,351) |
(39,129) | |||||||
Equity in net income of unconsolidated subsidiaries |
15,236 |
8,260 |
6,976 |
112,390 |
8,966 |
103,424 | |||||||
Income/(loss) before income taxes |
(27,455) |
18,070 |
(45,525) |
74,332 |
27,286 |
47,046 | |||||||
Income taxes expense |
1,683 |
7,742 |
6,059 |
5,395 |
9,560 |
4,165 | |||||||
Net income/(loss) |
(29,138) |
10,328 |
(39,466) |
68,937 |
17,726 |
51,211 | |||||||
Net income attributable to noncontrolling interests |
(1,282) |
(1,179) |
(103) |
(2,052) |
(2,748) |
696 | |||||||
Net income/(loss) attributable to Darling |
$ (30,420) |
$ 9,149 |
$ (39,569) |
$ 66,885 |
$ 14,978 |
$ 51,907 | |||||||
Basic income/(loss) per share: |
$ (0.18) |
$ 0.06 |
$ (0.24) |
$ 0.41 |
$ 0.09 |
$ 0.32 | |||||||
Diluted income/(loss) per share: |
$ (0.18) |
$ 0.05 |
$ (0.23) |
$ 0.40 |
$ 0.09 |
$ 0.31 | |||||||
Number of diluted common shares |
164,651 |
166,831 |
166,259 |
166,348 |
Darling Ingredients Inc. and Subsidiaries | ||||
Condensed Consolidated Balance Sheets | ||||
June 30, 2018 and December 30, 2017 | ||||
(in thousands) | ||||
June 30, |
December 30, | |||
2018 |
2017 | |||
ASSETS |
(unaudited) |
|||
Current assets: |
||||
Cash and cash equivalents |
$ 104,120 |
$ 106,774 | ||
Restricted cash |
142 |
142 | ||
Accounts receivable, net |
371,291 |
391,847 | ||
Inventories |
370,555 |
358,183 | ||
Prepaid expenses |
43,965 |
38,326 | ||
Income taxes refundable |
6,977 |
4,509 | ||
Other current assets |
21,148 |
56,664 | ||
Total current assets |
918,198 |
956,445 | ||
Property, plant and equipment, less accumulated depreciation, net |
1,624,354 |
1,645,822 | ||
Intangible assets, less accumulated amortization, net |
610,878 |
676,500 | ||
Goodwill |
1,232,964 |
1,301,093 | ||
Investment in unconsolidated subsidiaries |
399,097 |
302,038 | ||
Other assets |
56,802 |
62,284 | ||
Deferred income taxes |
14,623 |
14,043 | ||
Total assets |
$ 4,856,916 |
$ 4,958,225 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||
Current liabilities: |
||||
Current portion of long-term debt |
$ 7,466 |
$ 16,143 | ||
Accounts payable, principally trade |
185,150 |
217,417 | ||
Income taxes payable |
8,975 |
12,300 | ||
Accrued expenses |
281,139 |
313,623 | ||
Total current liabilities |
482,730 |
559,483 | ||
Long-term debt, net of current portion |
1,687,823 |
1,698,050 | ||
Other non-current liabilities |
105,649 |
106,287 | ||
Deferred income taxes |
242,683 |
266,708 | ||
Total liabilities |
2,518,885 |
2,630,528 | ||
Commitments and contingencies |
||||
Total Darling's stockholders' equity |
2,263,403 |
2,244,933 | ||
Noncontrolling interests |
74,628 |
82,764 | ||
Total stockholders' equity |
$ 2,338,031 |
$ 2,327,697 | ||
$ 4,856,916 |
$ 4,958,225 |
Darling Ingredients Inc. and Subsidiaries | ||||||
Consolidated Statement of Cash Flows | ||||||
Six Months Ended June 30, 2018 and July 1, 2017 | ||||||
(in thousands) | ||||||
(unaudited) | ||||||
Six Months Ended | ||||||
June 30, |
July 1, | |||||
Cash flows from operating activities: |
2018 |
2017 | ||||
Net income |
$ 68,937 |
$ 17,726 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||
Depreciation and amortization |
157,073 |
144,104 | ||||
Loss/(gain) on disposal of property, plant, equipment and other assets |
300 |
(358) | ||||
Loss on sale of subsidiary |
15,538 |
- | ||||
Asset impairment |
2,907 |
- | ||||
Gain on insurance proceeds from insurance settlements |
(1,253) |
- | ||||
Deferred taxes |
(7,512) |
(11,205) | ||||
Increase in long-term pension liability |
123 |
1,362 | ||||
Stock-based compensation expense |
13,232 |
11,003 | ||||
Write-off deferred loan costs |
8,105 |
340 | ||||
Deferred loan cost amortization |
4,664 |
4,366 | ||||
Equity in net income of unconsolidated subsidiaries |
(112,390) |
(8,966) | ||||
Distribution of earnings from unconsolidated subsidiaries |
26,567 |
25,806 | ||||
Changes in operating assets and liabilities, net of effects from acquisitions: |
||||||
Accounts receivable |
5,217 |
17,705 | ||||
Income taxes refundable/payable |
(5,438) |
12,857 | ||||
Inventories and prepaid expenses |
(30,561) |
(21,952) | ||||
Accounts payable and accrued expenses |
(25,705) |
16,594 | ||||
Other |
8,243 |
(11,845) | ||||
Net cash provided by operating activities |
128,047 |
197,537 | ||||
Cash flows from investing activities: |
||||||
Capital expenditures |
(139,130) |
(127,824) | ||||
Acquisitions, net of cash acquired |
(51,089) |
(12,369) | ||||
Investment of unconsolidated subsidiaries |
(6,500) |
(2,250) | ||||
Proceeds from sale of investment in subsidiaries |
82,805 |
- | ||||
Gross proceeds from disposal of property, plant and equipment and other assets |
2,244 |
3,603 | ||||
Proceeds from insurance settlement |
1,253 |
3,301 | ||||
Payments related to routes and other intangibles |
(294) |
(4,635) | ||||
Net cash used by investing activities |
(110,711) |
(140,174) | ||||
Cash flows from financing activities: |
||||||
Proceeds from long-term debt |
623,695 |
16,405 | ||||
Payments on long-term debt |
(650,976) |
(67,974) | ||||
Borrowings from revolving credit facility |
247,975 |
80,000 | ||||
Payments on revolving credit facility |
(221,632) |
(80,327) | ||||
Net cash overdraft financing |
4,517 |
(1,077) | ||||
Deferred loan costs |
(9,324) |
(1,177) | ||||
Issuance of common stock |
182 |
22 | ||||
Minimum withholding taxes paid on stock awards |
(2,123) |
(2,091) | ||||
Distributions to noncontrolling interests |
(983) |
(2,135) | ||||
Net cash used by financing activities |
(8,669) |
(58,354) | ||||
Effect of exchange rate changes on cash |
(11,321) |
11,233 | ||||
Net increase/(decrease) in cash, cash equivalents and restricted cash |
(2,654) |
10,242 | ||||
Cash, cash equivalents and restricted cash at beginning of period |
106,916 |
114,857 | ||||
Cash, cash equivalents and restricted cash at end of period |
$ 104,262 |
$ 125,099 | ||||
Supplemental disclosure of cash flow information: |
||||||
Accrued capital expenditures |
$ (6,336) |
$ (5,445) | ||||
Cash paid during the period for: |
||||||
Interest, net of capitalized interest |
$ 39,614 |
$ 38,688 | ||||
Income taxes, net of refunds |
$ 17,154 |
$ 7,986 | ||||
Non-cash financing activities: |
||||||
Debt issued for assets |
$ 17 |
$ - |
Selected financial information for the Company's Diamond Green Diesel Joint Venture is as follows:
Diamond Green Diesel Joint Venture | ||||||
Condensed Consolidated Balance Sheets | ||||||
June 30, 2018 and December 31, 2017 | ||||||
(in thousands) | ||||||
June 30, |
December 31, | |||||
2018 |
2017 | |||||
Assets: |
(unaudited) |
|||||
Total current assets |
$ 218,189 |
$ 202,778 | ||||
Property, plant and equipment, net |
529,312 |
435,328 | ||||
Other assets |
18,861 |
4,655 | ||||
Total assets |
$ 766,362 |
$ 642,761 | ||||
Liabilities and members' equity: |
||||||
Total current portion of long term debt |
$ 176 |
$ 17,023 | ||||
Total other current liabilities |
34,714 |
40,705 | ||||
Total long term debt |
8,583 |
36,730 | ||||
Total other long term liabilities |
465 |
450 | ||||
Total members' equity |
722,424 |
547,853 | ||||
Total liabilities and members' equity |
$ 766,362 |
$ 642,761 |
Diamond Green Diesel Joint Venture | ||||||||||||||
Operating Financial Results | ||||||||||||||
Three Months and Six Months Ended June 30, 2018 and June 30, 2017 | ||||||||||||||
(in thousands) | ||||||||||||||
(unaudited) | ||||||||||||||
Three Months Ended |
Six Months Ended | |||||||||||||
$ Change |
$ Change | |||||||||||||
June 30, |
June 30, |
Favorable |
June 30, |
June 30, |
Favorable | |||||||||
Revenues: |
2018 |
2017 |
(Unfavorable) |
2018 |
2017 |
(Unfavorable) | ||||||||
Operating revenues |
$ 151,989 |
$ 150,786 |
$ 1,203 |
$ 302,310 |
$ 276,183 |
$ 26,127 | ||||||||
Expenses: |
||||||||||||||
Total costs and expenses less depreciation, amortization and accretion expense |
115,659 |
125,975 |
10,316 |
65,838 |
241,297 |
175,459 | ||||||||
Depreciation, amortization and accretion expense |
6,254 |
8,021 |
1,767 |
12,374 |
16,134 |
3,760 | ||||||||
Total costs and expenses |
121,913 |
133,996 |
12,083 |
78,212 |
257,431 |
179,219 | ||||||||
Operating income |
30,076 |
16,790 |
13,286 |
224,098 |
18,752 |
205,346 | ||||||||
Other income |
415 |
328 |
87 |
792 |
551 |
241 | ||||||||
Interest and debt expense, net |
(319) |
(861) |
542 |
(319) |
(1,851) |
1,532 | ||||||||
Net income |
$ 30,172 |
$ 16,257 |
$ 13,915 |
$ 224,571 |
$ 17,452 |
$ 207,119 |
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 | ||||||||
Three and six months ended June 30, 2018 and July 1, 2017 | ||||||||
Three Months Ended - Year over Year |
Six Months Ended - Year over Year | |||||||
Adjusted EBITDA |
June 30, |
July 1, |
June 30, |
July 1, | ||||
(U.S. dollars in thousands) |
2018 |
2017 |
2018 |
2017 | ||||
Net income/(loss) attributable to Darling |
$ (30,420) |
$ 9,149 |
$ 66,885 |
$ 14,978 | ||||
Depreciation and amortization |
78,454 |
72,990 |
157,073 |
144,104 | ||||
Interest expense |
23,016 |
22,446 |
46,140 |
44,126 | ||||
Income tax expense |
1,683 |
7,742 |
5,395 |
9,560 | ||||
Restructuring and impairment charges |
14,965 |
- |
14,965 |
- | ||||
Foreign currency loss |
3,495 |
2,111 |
4,976 |
2,375 | ||||
Other expense/(income), net |
(1,199) |
3,797 |
1,317 |
5,850 | ||||
Debt extinguishment costs |
23,509 |
- |
23,509 |
- | ||||
Loss on sale of subsidiary |
15,538 |
- |
15,538 |
- | ||||
Equity in net (income) of unconsolidated subsidiaries |
(15,236) |
(8,260) |
(112,390) |
(8,966) | ||||
Net income attributable to noncontrolling interests |
1,282 |
1,179 |
2,052 |
2,748 | ||||
Adjusted EBITDA |
$115,087 |
$111,154 |
$225,460 |
$214,775 | ||||
Foreign currency exchange impact (1) |
(3,764) |
- |
(11,899) |
- | ||||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) |
$111,323 |
$111,154 |
$213,561 |
$214,775 | ||||
DGD Joint Venture Adjusted EBITDA (Darling's share) |
$ 18,165 |
$ 12,406 |
$118,236 |
$ 17,443 |
(1) |
The average rates assumption used in the calculation was the actual fiscal average rate for the three months ended June 30, 2018 of €1.00:USD$1.20 and CAD$1.00:USD$0.77 as compared to the average rate for the three months ended July 1, 2017 of €1.00:USD$1.10 and CAD$1.00:USD$0.74, respectively. The average rates assumption used in the calculation was the actual fiscal average rate for the six months ended June 30, 2018 of €1.00:USD$1.22 and CAD$1.00:USD$0.78 as compared to the average rate for the six months ended July 1, 2017 of €1.00:USD$1.08 and CAD$1.00:USD$0.75, respectively. |
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients, and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. 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 2018 financial results at 8:30 am Eastern Time (7:30 am Central Time) on Thursday, August 9, 2018. 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 10122304. 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 16, 2018, by dialing 1-877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 1-412-317-0088 (international callers). The access code for the replay is 10122304. 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 expenses, 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.
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 and 5.375% Notes and 3.625% Notes that were outstanding at June 30, 2018. 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 and 5.375% 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.
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," 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 Unites 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"), bovine spongiform encephalopathy (or "BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere; 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, PED or BSE 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 project; 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, including our ongoing enterprise resource planning project; 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 likely 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 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: | |
Melissa A. Gaither, VP IR and Global Communications |
Email : mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038 |
Phone : 972-717-0300 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-reports-second-quarter-2018-financial-results-300694145.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, June 5, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) (the "Company") today announced that management will present at the Oppenheimer 18th Annual Consumer Growth and E-Commerce Conference to be held at the Four Seasons Hotel in Boston on June 19-20, 2018. Randall C. Stuewe, Darling's Chief Executive Officer, is scheduled to present June 19th, at 2:55 p.m. ET, and will hold one-on-one meetings throughout the day. Mr. Stuewe will be joined by Brad Phillips, Executive Vice President and Chief Financial Officer, and Melissa Gaither, V.P. Investor Relations and Global Communications.
The investor presentation will be webcast and accessible via the Investor Relations section of the Company's website at http://www.darlingii.com.
About Darling
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at http://www.darlingii.com.
For More Information, contact: |
|
Melissa A. Gaither, V.P. Investor Relations and Global Communications |
Email: mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300 |
Phone: 972-717-0300 |
Irving, Texas 75038 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-to-present-at-oppenheimer-18th-annual-consumer-growth-and-e-commerce-conference-300660142.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, April 25, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) ("Darling" or the "Company") today announced that Darling Global Finance B.V. (the "Issuer"), an indirect, wholly-owned subsidiary of the Company incorporated under the laws of The Netherlands, has priced a private offering of €515 million in aggregate principal amount of its 3.625% unsecured senior notes due 2026 (the "Notes"). The Notes were priced at 100% of their face amount. The offering is expected to close on May 2, 2018, subject to the satisfaction of customary closing conditions.
The gross proceeds of the offering, together with borrowings under the Company's revolving credit facility, are expected to be used to refinance all of the Issuer's 4.75% Senior Notes due 2022 by cash tender offer for those notes, and, if and to the extent necessary, redemption of those notes and to pay any applicable premiums for the refinancing, to pay the commission of the initial purchasers of the Notes and to pay the other fees and expenses related to the offering.
The Notes will be offered in the United States to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside the United States to non-U.S. persons in reliance on Regulation S under the Securities Act. The Notes will not be registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws.
This media release shall not constitute an offer to sell or the solicitation of an offer to buy the Notes, nor shall there be any offer to sell, solicitation of an offer to buy or sale of the Notes, in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy and fertilizer industries. With operations in over 200 locations across five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments and disposal services for waste solids from the wastewater treatment systems of industrial food processing plants.
Cautionary Statements Regarding Forward‑Looking Information:
This media release contains "forward-looking" statements regarding the business operations and prospects of Darling Ingredients Inc., including its Diamond Green Diesel joint venture, 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," "assumption," and other words referring to events that may occur in the future. These statements reflect the Company'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 emissions that adversely affect programs like the Renewable Fuel Standards Program, low carbon fuel standards 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"), bovine spongiform encephalopathy (or "BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere; 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 affecting the industries in which the Company operates or its value added products (including new or modified animal feed, Bird Flu, PED or BSE or similar or unanticipated regulations); risks associated with the renewable diesel plant in Norco, Louisiana owned and operated by a joint venture between the Company and Valero Energy Corporation, including possible unanticipated operating disruptions and issues related to the announced expansion project; difficulties or a significant disruption in our information systems or failure to implement new systems and software successfully, including our ongoing enterprise resource planning project; 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 likely 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 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. Other risks and uncertainties regarding the Company, 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. The Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of changes in circumstances, new events or otherwise.
For More Information, contact:
Melissa A. Gaither, VP IR and Global Communications
Email: mgaither@darlingii.com
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038
Phone: 972‑717‑0300
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-pricing-of-private-offering-of-515-million-of-unsecured-senior-notes-due-2026-by-darling-global-finance-bv-300636432.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, April 23, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) ("Darling" or the "Company") today announced that Darling Global Finance B.V. ("DG Finance"), an indirect, wholly-owned subsidiary of the Company incorporated under the laws of The Netherlands, has commenced a cash tender offer (the "Tender Offer") for any and all of DG Finance's outstanding 4.75% Senior Notes due 2022 (the "Notes"). The Tender Offer is being made on the terms and subject to the conditions set forth in the offer to purchase dated April 23, 2018 (as it may be amended or supplemented, the "Offer to Purchase") and the related notice of guaranteed delivery (as it may be amended or supplemented, the "Notice of Guaranteed Delivery").
The Tender Offer will expire at 3:00 p.m., London time (10:00 a.m., New York City time), on May 2, 2018, unless extended (such time and date, as the same may be extended, the "Expiration Time") or otherwise terminated as described in the Offer to Purchase. Holders (as defined in the Offer to Purchase) of Notes who validly tender (and do not validly withdraw) their Notes in the Tender Offer at or prior to the Expiration Time, or who deliver to Lucid Issuer Services Limited ("Lucid") a properly completed and duly executed Notice of Guaranteed Delivery at or prior to the Expiration Time, and tender their Notes at or prior to the Notice of Guaranteed Delivery Date (as defined in the Offer to Purchase), in accordance with the instructions set forth in the Offer to Purchase, will receive in cash €1,027.45 per €1,000 principal amount of Notes (the "Purchase Price") validly tendered and accepted for purchase pursuant to the Tender Offer, plus accrued and unpaid interest ("Accrued Interest") from the last interest payment date for the Notes to, but excluding, the settlement date, which is expected to be May 3, 2018 (the "Settlement Date"). With respect to Notes tendered and accepted for purchase, if any, pursuant to the guaranteed delivery procedures described in the Offer to Purchase, the Holders thereof will receive payment of the Purchase Price for such Notes, plus Accrued Interest to, but excluding, the Settlement Date, on the Guaranteed Delivery Settlement Date (as defined in the Offer to Purchase), which is expected to be May 8, 2018. For the avoidance of doubt, Accrued Interest will cease to accrue on the Settlement Date for all Notes accepted for purchase pursuant to the Tender Offer, including those tendered pursuant to the guaranteed delivery procedures. DG Finance plans to redeem any Notes that remain outstanding after the completion of the Tender Offer. This announcement does not constitute a notice of redemption or an obligation to issue a notice of redemption.
The following table sets forth the material pricing terms of the Tender Offer:
Title of Security |
Common Codes/ISINs |
Principal Amount |
Purchase |
4.75% Senior |
144A (Common Code/ISIN):124098645/XS1240986452 Regulation S (Common Code/ISIN):124098475/XS1240984754 |
€515,000,000 |
€1,027.45(*) |
__________________________ |
*Per €1,000 principal amount of Notes. |
Tendered Notes may be validly withdrawn from the Tender Offer at any time (i) at or prior to the earlier of (x) 3:00 p.m., London time (10:00 a.m., New York City time), on May 2, 2018, unless the Tender Offer is extended, and (y) in the event that the Tender Offer is extended, the tenth business day after commencement of the Tender Offer, and (ii) after the 60th business day after commencement of the Tender Offer if for any reason the Tender Offer has not been consummated within 60 business days of the commencement of the Tender Offer. The Tender Offer is subject to the satisfaction or waiver by DG Finance of a number of conditions as set forth in the Offer to Purchase, including the completion by DG Finance of a proposed debt financing on terms reasonably satisfactory to DG Finance, in its sole discretion and subject to applicable law (the "Debt Financing"), generating net proceeds in an amount that, together with borrowings under Darling's revolving credit facility, is sufficient to effect the repurchase of the Notes validly tendered and accepted for purchase pursuant to the Tender Offer, including the payment of any Accrued Interest and costs and expenses incurred in connection therewith. DG Finance may amend, extend or terminate the Tender Offer in its sole discretion and subject to applicable law.
DG Finance has retained BNP Paribas to serve as dealer manager for the Tender Offer. DG Finance has appointed Lucid to serve as the tender and information agent for the Tender Offer.
For additional information regarding the terms of the Tender Offer, please contact BNP Paribas at +44 207 595 8668. Questions regarding the Tender Offer should be directed to Lucid at +44 20 7704 0880 or email darling@lucid-is.com. Documents for the Tender Offer, including the Offer to Purchase and Notice of Guaranteed Delivery, are available at www.lucid-is.com/darling, and may also be obtained by contacting Lucid by telephone.
None of DG Finance or its directors, the dealer manager, Lucid or the trustee for the Notes, or any of their respective affiliates, is making any recommendation as to whether Holders should tender any Notes in response to the Tender Offer. Holders must make their own decision as to whether to tender any of their Notes and, if so, the principal amount of Notes to tender.
This announcement is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell securities. The Tender Offer is being made solely by means of the Offer to Purchase and the Notice of Guaranteed Delivery. In those jurisdictions where the securities, blue sky or other laws require the Tender Offer to be made on behalf of DG Finance by a licensed broker or dealer, the Tender Offer will be deemed to be made by the dealer manager or one or more registered brokers or dealers licensed under the laws of such jurisdiction. This announcement does not constitute an offer to sell or a solicitation of an offer to buy any securities or other financial instruments that may be issued or otherwise incurred in connection with the Debt Financing.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy and fertilizer industries. With operations in over 200 locations across five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments and disposal services for waste solids from the wastewater treatment systems of industrial food processing plants.
Cautionary Statements Regarding Forward-Looking Information:
This announcement contains "forward-looking" statements regarding the business operations and prospects of Darling Ingredients Inc., including its Diamond Green Diesel joint venture, 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," "assumption," and other words referring to events that may occur in the future. These statements reflect the Company'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 emissions that adversely affect programs like the Renewable Fuel Standards Program, low carbon fuel standards 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"), bovine spongiform encephalopathy (or "BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere; 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 affecting the industries in which the Company operates or its value added products (including new or modified animal feed, Bird Flu, PED or BSE or similar or unanticipated regulations); risks associated with the renewable diesel plant in Norco, Louisiana owned and operated by a joint venture between the Company and Valero Energy Corporation, including possible unanticipated operating disruptions and issues related to the announced expansion project; difficulties or a significant disruption in our information systems or failure to implement new systems and software successfully, including our ongoing enterprise resource planning project; 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 likely 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 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. Other risks and uncertainties regarding the Company, 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. The Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of changes in circumstances, new events or otherwise.
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-cash-tender-offer-by-darling-global-finance-bv-for-any-and-all-4-75-senior-notes-due-2022--300634252.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, April 23, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) ("Darling" or the "Company") today announced that Darling Global Finance B.V. (the "Issuer"), an indirect, wholly-owned subsidiary of the Company incorporated under the laws of The Netherlands, has launched an offering of €515 million in aggregate principal amount of its unsecured senior notes (the "Notes"). The Notes will be guaranteed by the Company and by all of the Company's restricted subsidiaries, other than any foreign subsidiary or any receivables entity, that are borrowers under or that guarantee the Company's senior secured credit facilities under its Second Amended and Restated Credit Agreement dated January 6, 2014, as amended. The offering is subject to market and other conditions.
The gross proceeds of the Notes offering, together with borrowings under the Company's revolving credit facility, are expected to be used to refinance all of the Issuer's 4.75% Senior Notes due 2022 by cash tender offer for those notes, and, if and to the extent necessary, redemption of those notes and to pay any applicable premiums for the refinancing, to pay the commission of the initial purchasers of the Notes and to pay the other fees and expenses related to the offering of the Notes.
The Notes will be offered in the United States to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside the United States to non‑U.S. persons in reliance on Regulation S under the Securities Act. The Notes will not be registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws.
This media release shall not constitute an offer to sell or the solicitation of an offer to buy the Notes, nor shall there be any offer to sell, solicitation of an offer to buy or sale of the Notes, in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy and fertilizer industries. With operations in over 200 locations across five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments and disposal services for waste solids from the wastewater treatment systems of industrial food processing plants.
Cautionary Statements Regarding Forward‑Looking Information:
This media release contains "forward-looking" statements regarding the business operations and prospects of Darling Ingredients Inc., including its Diamond Green Diesel joint venture, 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," "assumption," and other words referring to events that may occur in the future. These statements reflect the Company'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 emissions that adversely affect programs like the Renewable Fuel Standards Program, low carbon fuel standards 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"), bovine spongiform encephalopathy (or "BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere; 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 affecting the industries in which the Company operates or its value added products (including new or modified animal feed, Bird Flu, PED or BSE or similar or unanticipated regulations); risks associated with the renewable diesel plant in Norco, Louisiana owned and operated by a joint venture between the Company and Valero Energy Corporation, including possible unanticipated operating disruptions and issues related to the announced expansion project; difficulties or a significant disruption in our information systems or failure to implement new systems and software successfully, including our ongoing enterprise resource planning project; 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 likely 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 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. Other risks and uncertainties regarding the Company, 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. The Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of changes in circumstances, new events or otherwise.
For More Information, contact:
Melissa A. Gaither, VP IR and Global Communications
Email: mgaither@darlingii.com
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038
Phone: 972-717-0300
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-private-offering-of-515-million-of-unsecured-senior-notes-by-darling-global-finance-bv-300634253.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Feb. 27, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR), a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy, and fertilizer industries, today announced financial results for the fiscal 2017 fourth quarter and year ended December 30, 2017.
Fourth Quarter 2017 Overview
Fiscal 2017 Overview
For the fourth quarter of 2017, the Company reported net sales of $952.5 million, as compared with net sales of $885.8 million for the fourth quarter of 2016. Net income attributable to Darling for the three months ended December 30, 2017 was $105.7 million, or $0.63 per diluted share, compared to a net income of $40.5 million, or $0.25 per diluted share, for the fourth quarter of 2016. The increase in net income for the fourth quarter 2017 is primarily attributable to the reversal of deferred tax liabilities due to the U.S. Tax Cuts and Jobs Act, benefits from European tax reform, along with improved raw material volumes and pricing across the segments. For comparison purposes, fourth quarter results do not reflect the blenders tax credit.
Net Income attributable to Darling for the fiscal year ended December 30, 2017 was $128.5 million, or $0.77 per diluted share, as compared to a net income of $102.3 million, or $0.62 per diluted share, for the fiscal year ended December 31, 2016. The increase in net income for 2017 is primarily attributable to the reversal of deferred tax liabilities due to the U.S. Tax Cuts and Jobs Act along with benefits from European tax reform. Strong volumes, consistent margins, and improvements in our specialty businesses aided the Feed segment, while the Food segment delivered a consistent performance lead by CTH, our natural casings business, with Rousselot achieving record sales volumes and stabilizing margins. In the Fuel segment, results reflect the absence of the blenders tax credit which was reinstated retroactively for 2017 during February 2018. First quarter 2018 results will reflect income of $12.6 million from the blenders tax credit.
Comments on the Fourth Quarter and Fiscal 2017 Year End
"We are pleased to report a strong finish to 2017, with improved fourth quarter results driven by streamlined operations across our global platform," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "We leveraged higher global raw material volumes with consistent margins by managing through deflationary finished product markets in the Feed Ingredients segment. Food Ingredients delivered strong operating performance across all product lines while managing through continued macroeconomic headwinds in South American markets. Sequentially, our North American and Canadian biodiesel facilities showed improved operational performance though earnings were negatively impacted due to the absence of the blenders tax credit. We are pleased to see the reinstatement of the blenders tax credit, applied retroactively for 2017. Diamond Green Diesel excelled operationally and delivered $86 million EBITDA (Darling's half being $43 million), or $0.54 per gallon, excluding the blenders tax credit. The Diamond Green Diesel expansion project to increase production from 160 million gallons to 275 million gallons annually is progressing well, with the facility expected to go down in mid-May for final tie-ins before completion in late Q2 2018.
"During the year, our global capital growth plan included multiple new construction projects, expansions and bolt on acquisitions to maximize our world of growth strategy, and engineering of our product mix to meet the needs of changing global diets. Our strong balance sheet combined with improved working capital deployment enabled further deleveraging of $112.5 million, exceeding our stated goal of $100 million in 2017. We continue to execute well, diversify our global platform and deploy prudent growth capital investments to drive meaningful growth and profitability in the future."
Operational Update by Segment
Financial Update by Segment
Feed Ingredients |
Three Months Ended |
Fiscal Year Ended | ||||
($ thousands) |
December 30, 2017 |
December 31, 2016 |
December 30, 2017 |
December 31, 2016 | ||
Net sales |
$ 562,206 |
$ 538,606 |
$ 2,239,492 |
$ 2,089,145 | ||
Selling, general and administrative expenses |
46,422 |
42,135 |
180,866 |
169,648 | ||
Depreciation and amortization |
49,239 |
48,735 |
184,172 |
178,845 | ||
Segment operating income |
26,231 |
25,282 |
129,686 |
115,794 | ||
EBITDA |
$ 75,470 |
$ 74,017 |
$ 313,858 |
$ 294,639 |
*EBITDA calculated by adding depreciation and amortization to segment operating income. |
Food Ingredients |
Three Months Ended |
Fiscal Year Ended | ||||
($ thousands) |
December 30, 2017 |
December 31, 2016 |
December 30, 2017 |
December 31, 2016 | ||
Net sales (1) |
$ 313,478 |
$ 278,378 |
$ 1,156,976 |
$ 1,055,725 | ||
Selling, general and administrative expenses |
27,502 |
26,604 |
104,982 |
96,170 | ||
Depreciation and amortization |
19,719 |
18,297 |
75,010 |
70,120 | ||
Segment operating income |
16,274 |
11,738 |
56,409 |
61,212 | ||
EBITDA |
$ 35,993 |
$ 30,035 |
$ 131,419 |
$ 131,332 |
*EBITDA calculated by adding depreciation and amortization to segment operating income. | |||
(1) Net sales were adjusted for Brazil VAT reclass. |
Fuel Ingredients |
Three Months Ended |
Fiscal Year Ended | ||||
($ thousands) |
December 30, 2017 |
December 31, 2016 |
December 30, 2017 |
December 31, 2016 | ||
Net sales |
$ 76,865 |
$ 68,773 |
$ 265,783 |
$ 247,058 | ||
Selling, general and administrative expenses |
4,735 |
1,909 |
10,467 |
6,895 | ||
Depreciation and amortization |
8,547 |
7,532 |
31,019 |
28,531 | ||
Segment operating income |
8,049 |
10,486 |
13,789 |
29,166 | ||
EBITDA |
$ 16,596 |
$ 18,018 |
$ 44,808 |
$ 57,697 |
*EBITDA calculated by adding depreciation and amortization to segment operating income. | |||
Results shown do not include the Diamond Green Diesel (DGD) 50% Joint Venture. |
Darling Ingredients Inc. and Subsidiaries | ||||
Condensed Consolidated Balance Sheets | ||||
December 30, 2017 and December 31, 2016 | ||||
(in thousands) | ||||
December 30, |
December 31, | |||
2017 |
2016 | |||
ASSETS |
||||
Current assets: |
||||
Cash and cash equivalents |
$ 106,774 |
$ 114,564 | ||
Restricted cash |
142 |
293 | ||
Accounts Receivable, net |
391,847 |
388,397 | ||
Inventories |
358,183 |
330,815 | ||
Prepaid expenses |
38,326 |
29,984 | ||
Income taxes refundable |
4,509 |
7,479 | ||
Other current assets |
56,664 |
21,770 | ||
Total current assets |
956,445 |
893,302 | ||
Property, plant and equipment, net |
1,645,822 |
1,515,575 | ||
Intangible assets, less accumulated amortization of $383,836 at December 30, 2017 and $301,187 at December 31, 2016 |
676,500 |
711,927 | ||
Goodwill |
1,301,093 |
1,225,893 | ||
Investment in unconsolidated subsidiaries |
302,038 |
292,717 | ||
Other assets |
62,284 |
43,613 | ||
Deferred income taxes |
14,043 |
14,990 | ||
$ 4,958,225 |
$ 4,698,017 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||
Current liabilities: |
||||
Current portion of long-term debt |
$ 16,143 |
$ 23,247 | ||
Accounts payable, principally trade |
217,417 |
180,895 | ||
Income taxes payable |
12,300 |
4,913 | ||
Accrued expenses |
313,623 |
242,796 | ||
Total current liabilities |
559,483 |
451,851 | ||
Long-term debt, net of current portion |
1,698,050 |
1,727,696 | ||
Other non-current liabilities |
106,287 |
96,114 | ||
Deferred income taxes |
266,708 |
346,134 | ||
Total liabilities |
2,630,528 |
2,621,795 | ||
Commitments and contingencies |
||||
Total Darling's stockholders' equity: |
2,244,933 |
1,972,994 | ||
Noncontrolling interests |
82,764 |
103,228 | ||
Total stockholders' equity |
$ 2,327,697 |
$ 2,076,222 | ||
$ 4,958,225 |
$ 4,698,017 |
Darling Ingredients Inc. and Subsidiaries | ||||||||||||
Consolidated Operating Results | ||||||||||||
For the Periods Ended December 30, 2017 and December 31, 2016 | ||||||||||||
(in thousands, except per share data) | ||||||||||||
(Fourth Quarter Unaudited) |
||||||||||||
Three Months Ended |
Fiscal Year Ended | |||||||||||
$ Change |
$ Change | |||||||||||
December 30, |
December 31, |
Favorable |
December 30, |
December 31, |
Favorable | |||||||
2017 |
2016 |
(Unfavorable) |
2017 |
2016 |
(Unfavorable) | |||||||
Net sales |
$ 952,549 |
$ 885,757 |
$ 66,792 |
$ 3,662,251 |
$ 3,391,928 |
$ 270,323 | ||||||
Costs and expenses: |
||||||||||||
Cost of sales and operating expenses |
745,831 |
693,039 |
(52,792) |
2,875,851 |
2,635,547 |
(240,304) | ||||||
Selling, general and administrative expenses |
90,898 |
79,870 |
(11,028) |
347,487 |
314,005 |
(33,482) | ||||||
Depreciation and amortization |
80,794 |
77,468 |
(3,326) |
302,100 |
289,908 |
(12,192) | ||||||
Acquisition and integration costs |
- |
- |
- |
- |
401 |
401 | ||||||
Total costs and expenses |
917,523 |
850,377 |
(67,146) |
3,525,438 |
3,239,861 |
(285,577) | ||||||
Operating income |
35,026 |
35,380 |
(354) |
136,813 |
152,067 |
(15,254) | ||||||
Other expense: |
||||||||||||
Interest expense |
(22,269) |
(22,439) |
170 |
(88,926) |
(94,187) |
5,261 | ||||||
Foreign currency gain/(loss) |
(2,468) |
387 |
(2,855) |
(6,898) |
(1,854) |
(5,044) | ||||||
Other income/(expense), net |
(190) |
1,819 |
(2,009) |
(5,293) |
(3,866) |
(1,427) | ||||||
Total other expense |
(24,927) |
(20,233) |
(4,694) |
(101,117) |
(99,907) |
(1,210) | ||||||
Equity in net income of unconsolidated subsidiaries |
11,835 |
32,746 |
(20,911) |
28,504 |
70,379 |
(41,875) | ||||||
Income before income taxes |
21,934 |
47,893 |
(25,959) |
64,200 |
122,539 |
(58,339) | ||||||
Income taxes expense/(benefit) |
(85,010) |
6,213 |
91,223 |
(69,154) |
15,315 |
84,469 | ||||||
Net income |
106,944 |
41,680 |
65,264 |
133,354 |
107,224 |
26,130 | ||||||
Net income attributable to noncontrolling interests |
(1,215) |
(1,139) |
(76) |
(4,886) |
(4,911) |
25 | ||||||
Net income attributable to Darling |
$ 105,729 |
$ 40,541 |
$ 65,188 |
$ 128,468 |
$ 102,313 |
$ 26,155 | ||||||
Basic income per share: |
$ 0.64 |
$ 0.25 |
$ 0.40 |
$ 0.78 |
$ 0.62 |
$ 0.16 | ||||||
Diluted income per share: |
$ 0.63 |
$ 0.25 |
$ 0.38 |
$ 0.77 |
$ 0.62 |
$ 0.15 | ||||||
Number of diluted common shares: |
166,997 |
165,372 |
166,730 |
165,212 |
Darling Ingredients Inc. and Subsidiaries | ||||||
Consolidated Statement of Cash Flows | ||||||
Fiscal Years Ended December 30, 2017 and December 31, 2016 | ||||||
(in thousands) | ||||||
Fiscal Year Ended | ||||||
December 30, |
December 31, | |||||
Cash flows from operating activities: |
2017 |
2016 | ||||
Net income |
$ 133,354 |
$ 107,224 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||
Depreciation and amortization |
302,100 |
289,908 | ||||
Deferred taxes |
(98,805) |
(11,532) | ||||
Loss/(gain) on sale of assets |
(237) |
1,744 | ||||
Gain on insurance proceeds from insurance settlement |
(1,427) |
(356) | ||||
Increase/(decrease) in long-term pension liability |
2,383 |
(430) | ||||
Stock-based compensation expense |
17,598 |
10,330 | ||||
Write-off deferred loan costs |
766 |
528 | ||||
Deferred loan cost amortization |
8,736 |
11,171 | ||||
Equity in net income of unconsolidated subsidiaries |
(28,504) |
(70,379) | ||||
Distribution of earnings from unconsolidated subsidiaries |
26,761 |
26,317 | ||||
Changes in operating assets and liabilities, net of effects from acquisitions: |
||||||
Accounts receivable |
3,482 |
(22,796) | ||||
Income taxes refundable/payable |
9,360 |
2,839 | ||||
Inventories and prepaid expenses |
(15,022) |
15,343 | ||||
Accounts payable and accrued expenses |
73,386 |
39,286 | ||||
Other |
(23,344) |
(8,161) | ||||
Net cash provided by operating activities |
410,587 |
391,036 | ||||
Cash flows from investing activities: |
||||||
Capital expenditures |
(274,168) |
(243,523) | ||||
Acquisitions, net of cash acquired |
(12,144) |
(8,511) | ||||
Investment of unconsolidated subsidiary |
(4,750) |
- | ||||
Gross proceeds from disposal of property, plant and equipment and other assets |
8,090 |
7,329 | ||||
Proceeds from insurance settlement |
6,054 |
1,537 | ||||
Payments related to routes and other intangibles |
(7,135) |
(23) | ||||
Net cash used by investing activities |
(284,053) |
(243,191) | ||||
Cash flows from financing activities: |
||||||
Proceeds from long-term debt |
33,401 |
36,327 | ||||
Payments on long-term debt |
(149,623) |
(204,428) | ||||
Borrowings from revolving credit facility |
199,495 |
99,276 | ||||
Payments on revolving credit facility |
(204,935) |
(104,028) | ||||
Net cash overdraft financing |
(714) |
1,071 | ||||
Deferred loan costs |
(6,717) |
(3,879) | ||||
Issuance of common stock |
22 |
188 | ||||
Repurchase of common stock |
- |
(5,000) | ||||
Minimum withholding taxes paid on stock awards |
(3,049) |
(1,843) | ||||
Deductions of noncontrolling interest |
(17,451) |
- | ||||
Distributions to noncontrolling interests |
(5,281) |
(1,552) | ||||
Net cash used in financing activities |
(154,852) |
(183,868) | ||||
Effect of exchange rate changes on cash flows |
20,528 |
(6,297) | ||||
Net increase/(decrease) in cash and cash equivalents |
(7,790) |
(42,320) | ||||
Cash and cash equivalents at beginning of year |
114,564 |
156,884 | ||||
Cash and cash equivalents at end of year |
$ 106,774 |
$ 114,564 | ||||
Supplemental disclosure of cash flow information: |
||||||
Accrued capital expenditures |
$ 1,521 |
$ (937) | ||||
Cash paid during the period for: |
||||||
Interest, net of capitalized interest |
$ 78,233 |
$ 82,094 | ||||
Income taxes, net of refunds |
$ 26,304 |
$ 23,220 | ||||
Non-cash financing activities: |
||||||
Debt issued for service contract assets |
$ 9,459 |
$ 10 | ||||
Contribution of assets to unconsolidated subsidiary |
$ - |
$ 2,674 |
Diamond Green Diesel Joint Venture | ||||||
Condensed Consolidated Balance Sheets | ||||||
December 31, 2017 and December 31, 2016 | ||||||
(in thousands) | ||||||
December 31, |
December 31, | |||||
2017 |
2016 | |||||
Assets: |
||||||
Total current assets |
$ 202,778 |
$ 268,734 | ||||
Property, plant and equipment, net |
435,328 |
354,871 | ||||
Other assets |
4,655 |
12,164 | ||||
Total assets |
$ 642,761 |
$ 635,769 | ||||
Liabilities and members' equity: |
||||||
Total current portion of long term debt |
$ 17,023 |
$ 17,023 | ||||
Total other current liabilities |
40,704 |
23,200 | ||||
Total long term debt |
36,730 |
53,753 | ||||
Total other long term liabilities |
450 |
418 | ||||
Total members' equity |
547,853 |
541,375 | ||||
Total liabilities and members' equity |
$ 642,761 |
$ 635,769 |
Diamond Green Diesel Joint Venture | |||||||||||||
Operating Financial Results | |||||||||||||
Three Months and Fiscal Year Ended December 31, 2017 and December 31, 2016 | |||||||||||||
(in thousands) | |||||||||||||
Three Months Ended |
Twelve Months Ended | ||||||||||||
$ Change |
$ Change | ||||||||||||
December 31, |
December 31, |
Favorable |
December 31, |
December 31, |
Favorable | ||||||||
Revenues: |
2017 |
2016 |
(Unfavorable) |
2017 |
2016 |
(Unfavorable) | |||||||
Operating revenues |
$ 182,140 |
$ 182,020 |
$ 120 |
$ 633,908 |
$ 527,670 |
$ 106,238 | |||||||
Expenses: |
|||||||||||||
Total costs and expenses less depreciation, amortization and accretion expense |
151,769 |
108,579 |
(43,190) |
547,512 |
353,222 |
(194,290) | |||||||
Depreciation, amortization and accretion expense |
6,088 |
7,451 |
1,363 |
28,955 |
27,821 |
(1,134) | |||||||
Total costs and expenses |
157,857 |
116,030 |
(41,827) |
576,467 |
381,043 |
(195,424) | |||||||
Operating income |
24,283 |
65,990 |
(41,707) |
57,441 |
146,627 |
(89,186) | |||||||
Other income |
384 |
352 |
32 |
1,343 |
551 |
792 | |||||||
Interest and debt expense, net |
- |
(1,206) |
1,206 |
(2,306) |
(7,354) |
5,048 | |||||||
Net income |
$ 24,667 |
$ 65,136 |
$ (40,469) |
$ 56,478 |
$ 139,824 |
$ (83,346) |
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 | ||||||||
Three and twelve months ended December 30, 2017 and December 31, 2016 | ||||||||
Three Months Ended - Year over Year |
Fiscal Year Ended | |||||||
Adjusted EBITDA |
December 30, |
December 31, |
December 30, |
December 31, | ||||
(U.S. dollars in thousands) |
2017 |
2016 |
2017 |
2016 | ||||
Net income attributable to Darling |
$ 105,729 |
$ 40,541 |
$ 128,468 |
$ 102,313 | ||||
Depreciation and amortization |
80,794 |
77,468 |
302,100 |
289,908 | ||||
Interest expense |
22,269 |
22,439 |
88,926 |
94,187 | ||||
Income tax expense/(benefit) |
(85,010) |
6,213 |
(69,154) |
15,315 | ||||
Foreign currency loss/(gain) |
2,468 |
(387) |
6,898 |
1,854 | ||||
Other expense/(income), net |
190 |
(1,819) |
5,293 |
3,866 | ||||
Equity in net (income) of unconsolidated subsidiaries |
(11,835) |
(32,746) |
(28,504) |
(70,379) | ||||
Net income attributable to noncontrolling interests |
1,215 |
1,139 |
4,886 |
4,911 | ||||
Adjusted EBITDA (Non-GAAP) |
$ 115,820 |
$ 112,848 |
$ 438,913 |
$ 441,975 | ||||
Acquisition and integration-related expenses |
- |
- |
- |
401 | ||||
Pro forma Adjusted EBITDA (Non-GAAP) |
$ 115,820 |
$ 112,848 |
$ 438,913 |
$ 442,376 | ||||
Foreign currency exchange impact |
(5,913) |
(1) |
- |
(5,682) |
(2) |
- | ||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) |
$ 109,907 |
$ 112,848 |
$ 433,231 |
$ 442,376 | ||||
DGD Joint Venture Adjusted EBITDA (Darling's share) |
$ 15,185 |
$ 36,721 |
$ 43,198 |
$ 87,224 |
(1) |
The average rates assumption used in the calculation was the actual fiscal average rate for the three months ended December 31, 2016 of €1.00:USD$1.08 and CAD$1.00:USD$0.75 as compared to the average rate for the three months ended December 30, 2017 of €1.00:USD$1.18 and CAD$1.00:USD$0.79, respectively. |
(2) |
The average rates assumption used in the calculation was the actual fiscal average rate for the twelve months ended December 31, 2016 of €1.00:USD$1.11 and CAD$1.00:USD$0.76 as compared to the average rate for the twelve months ended December 30, 2017 of €1.00:USD$1.13 and CAD$1.00:USD$0.77, respectively. |
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, nutraceutical, food, pet food, feed, industrial, fuel, bioenergy and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients, and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments and disposal services for waste solids from the wastewater treatment systems of industrial food processing plants. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. 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 fourth quarter and fiscal year end 2017 financial results at 8:30 am Eastern Time (7:30 am Central Time) on Wednesday, February 28, 2018. 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 10115918. 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 March 7, 2018, 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 10115918. 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 expenses, 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.
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 and 5.375% Notes and 4.75% Notes that were outstanding at December 30, 2017. 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 and 5.375% Notes and 4.75% 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.
Cautionary Statements Regarding Forward-Looking Information:
{This media release contains "forward-looking" statements regarding the business operations and prospects of Darling Ingredients Inc., including its Diamond Green Diesel joint venture, 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," "assumption," 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 emissions that adversely affect programs like the Renewable Fuel Standards Program (RFS2), low carbon fuel standards (LCFS) and tax credits for biofuels both in the Unites States and abroad; possible product recall resulting from developments relating to the discovery of unauthorized adulterations to food or food additives; the occurrence of Bird Flu including, but not limited to H5N1 flu, bovine spongiform encephalopathy (or "BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere; 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 regulations (including, without limitation, China) affecting the industries in which the Company operates or its value added products (including new or modified animal feed, Bird Flu, PED or BSE or similar or unanticipated regulations); risks associated with the renewable diesel plant in Norco, Louisiana owned and operated by a joint venture between Darling Ingredients and Valero Energy Corporation, including possible unanticipated operating disruptions and issues related to the announced expansion project; difficulties or a significant disruption in our information systems or failure to implement new systems and software successfully, including our ongoing enterprise resource planning project; 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 likely 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 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: | |
Melissa A. Gaither, VP IR and Global Communications |
Email : mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038 |
Phone : 972-717-0300 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-reports-fourth-quarter-and-fiscal-2017-financial-results-executing-world-of-growth-strategy-300605130.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Feb. 23, 2018 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) will hold a conference call and webcast on Wednesday, February 28, 2018, to discuss the Company's fourth quarter and year end 2017 financial results. The teleconference will begin at 8:30 a.m. ET and will be hosted by Mr. Randall Stuewe, CEO and Chairman of the Board, and Mr. Brad Phillips, EVP and Chief Financial Officer. Additionally, the Company will have a slide presentation available to augment management's formal presentation, which will be accessible via the investor relations section of the Company's website. The related press release will be issued after the market closes on February 27, 2018.
Due to historically high call volume, the company is offering participants the opportunity to register in advance for the conference through the following link: http://dpregister.com/10115918
Registered participants will receive an email with a calendar reminder and a dial-in number and PIN that will allow them immediate access to the call on February 28, 2018.
Participants who do not wish to pre-register for the call may dial in using 844-868-8847 (U.S. callers) or 412-317-6593 (international callers), and ask for the "Darling Ingredients" call. A replay will be available two hours after completion of the call through March 7, 2018. To access the replay, please dial 877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 412-317-0088 (international callers) and reference passcode 10115918. The live webcast and archived replay also can be accessed on the Company's website at http://ir.darlingii.com.
About Darling
Darling Ingredients Inc. is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, nutraceutical, food, pet food, feed, industrial, fuel, bioenergy and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts recycled oils (used cooking oil and animal fats) into valuable feed and fuel ingredients, and collects and processes residual bakery products into feed ingredients. In addition, the Company provides environmental services, such as grease trap collection and disposal services to food service establishments and disposal services for waste solids from the wastewater treatment systems of industrial food processing plants. The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. For additional information, visit the Company's website at http://www.darlingii.com.
For More Information, contact: |
|||||||
Melissa A. Gaither |
251 O'Connor Ridge Blvd., Suite 300 | ||||||
Vice President Investor Relations and |
Irving, Texas 75038 | ||||||
Global Communications |
Phone: 972-281-4478 | ||||||
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-fourth-quarter-and-year-end-2017-earnings-conference-call-and-webcast-300603371.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Dec. 12, 2017 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR), today announced that CEO and Chairman, Randall C. Stuewe, will ring The NYSE Closing Bell® on the New York Stock Exchange (NYSE) tomorrow, December 13, 2017, at 3:55 p.m. EST to commemorate the 10th anniversary of the company's listing on the NYSE. Several members of the Board of Directors along with the executive management team will join Mr. Stuewe at the podium.
"We are proud to celebrate our 10-year stock listing anniversary on the New York Stock Exchange with the closing bell ceremony," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "Darling has built an incredible global platform with a broad product portfolio to serve the food, feed and fuel needs of a growing global population. Today, we are more encouraged than ever by the world of growth opportunities ahead of us. We remain energized and committed to creating value for our employees, customers and investors, which includes continuing our strong relationship with the NYSE."
Publicly traded since 1994, Darling was established as Darling and Company in 1882. The Company has over 10,000 employees worldwide across five continents with more than 200 locations.
In addition to live television coverage of the closing bell ceremony, the event will be streamed on Darling's website at www.darlingii.com as well as on the NYSE's website at https://www.nyse.com/bell. A video archive will also be available on both sites.
About Darling
Darling Ingredients Inc. is the world's largest publicly traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty products for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into broadly used and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at http://www.darlingii.com.
For More Information, contact: |
|
Melissa A. Gaither, VP IR and Global Communications |
Email : mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038 |
Phone : 972-717-0300 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-to-ring-nyse-closing-bell-300569814.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Nov. 7, 2017 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) and Valero Energy Corporation (NYSE: VLO) ("Valero") announced today that in anticipation of growing demand for renewable diesel due to the Renewable Fuel Standard (RFS) and global low carbon markets, they will initiate an engineering and construction cost review to analyze an additional project growing annual production capacity to 550 million gallons at the Diamond Green Diesel (DGD) facility in Norco, LA.
The DGD facility is currently undergoing an expansion project that will grow annual production capacity from 160 million gallons of renewable diesel to 275 million gallons. This project is targeted for completion in second quarter 2018.
"Diamond Green Diesel has proven to be a tremendous success and we acknowledge Valero's engineering excellence as the key," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "Our partnership through DGD has created a sustainable and efficient process of converting Darling's feedstocks into high quality biofuels to meet the needs of our customers around the world."
A final decision on the incremental 275 million gallons of annual production capacity is expected in 2018 and will be dependent on further engineering and cost estimates, as well as the status of government regulations. The proposed expansion would utilize existing DGD infrastructure and be built on property owned by Valero. If a decision is made to proceed with the proposed expansion, the new capacity would be available in the first half of 2021. Current DGD operations are not expected to be impacted if the proposed expansion is built.
About Darling
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty products for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into broadly used and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at http://www.darlingii.com.
About Valero
Valero Energy Corporation, through its subsidiaries, is an international manufacturer and marketer of transportation fuels and other petrochemical products. Valero, a Fortune 50 company based in San Antonio, Texas, with approximately 10,000 employees, is an independent petroleum refiner and ethanol producer, and its assets include 15 petroleum refineries with a combined throughput capacity of approximately 3.1 million barrels per day and 11 ethanol plants with a combined production capacity of 1.4 billion gallons per year. The petroleum refineries are located in the United States (U.S.), Canada and the United Kingdom (U.K.), and the ethanol plants are located in the Mid-Continent region of the U.S. In addition, Valero owns the 2 percent general partner interest and a majority limited partner interest in Valero Energy Partners LP, a midstream master limited partnership. Valero sells its products in both the wholesale rack and bulk markets, and approximately 7,400 outlets carry Valero's brand names in the U.S., Canada, the U.K. and Ireland. Please visit www.valero.com for more information.
Darling Ingredients contact | |
Melissa A. Gaither, VP IR and Global Communications |
Email: mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038 |
Phone: 972-717-0300 |
Valero Contacts
Investors:
John Locke, Vice President – Investor Relations, 210-345-3077
Karen Ngo, Senior Manager – Investor Relations, 210-345-4574
Tom Mahrer, Manager – Investor Relations, 210-345-1953
Media:
Lillian Riojas, Director – Media Relations and Communications, 210-345-5002
Cautionary Statements Regarding Forward-Looking Information:
{This media release contains "forward-looking" statements regarding the business operations and prospects of Darling Ingredients Inc., including its Diamond Green Diesel (DGD) joint venture, 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," "assumption," 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, changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs like the Renewable Fuel Standards Program (RFS2), low carbon fuel standards (LCFS) and tax credits for biofuels both in the Unites States and abroad; and risks associated with the DGD renewable diesel plant in Norco, Louisiana, including possible unanticipated operating disruptions and issues related to the announced expansion project. 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.}
View original content:http://www.prnewswire.com/news-releases/diamond-green-diesel-initiates-engineering-review-for-proposed-expansion-to-550-million-gallons-annually-300551180.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, Oct. 10, 2017 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) will hold a conference call and webcast on Wednesday, November 8, 2017, to discuss the Company's third quarter 2017 financial results. The teleconference will begin at 8:30 a.m. ET and will be hosted by Mr. Randall Stuewe, CEO and Chairman of the Board, and Mr. Patrick Lynch, EVP and Chief Financial Officer. Additionally, the Company will have a slide presentation available to augment management's formal presentation, which will be accessible via the investor relations section of the Company's website. The related press release will be issued after the market closes on November 7, 2017.
Due to historically high call volume, the company is offering participants the opportunity to register in advance for the conference through the following link: http://dpregister.com/10112133
Registered participants will receive an email with a calendar reminder and a dial-in number and PIN that will allow them immediate access to the call on November 8, 2017.
Participants who do not wish to pre-register for the call may dial in using 844-868-8847 (U.S. callers) or 412-317-6593 (international callers), and ask for the "Darling Ingredients" call. A replay will be available two hours after completion of the call through November 15, 2017. To access the replay, please dial 877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 412-317-0088 (international callers) and reference passcode 10112133. The live webcast and archived replay also can be accessed on the Company's website at http://ir.darlingii.com.
About Darling
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty products for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into broadly used and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at www.darlingii.com.
Safe-Harbor Statement
Statements contained in this release that state the Company's or management's expectations or predictions of the future are forward-looking statements intended to be covered by the safe harbor provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The words "believe," "expect," "should," "estimates," "intend," and other similar expressions identify forward-looking statements. It is important to note that actual results could differ materially from those projected in such forward-looking statements. For reports on Form 10-K and quarterly reports on Form 10-Q filed with the SEC and on Darling's website at http://ir.darlingii.com.
For More Information, contact: |
|
Melissa A. Gaither |
251 O'Connor Ridge Blvd., Suite 300 |
Vice President Investor Relations and |
Irving, Texas 75038 |
Global Communications |
Phone: 972-717-0300 |
View original content:http://www.prnewswire.com/news-releases/darling-ingredients-inc-announces-third-quarter-2017-earnings-conference-call-and-webcast-300534007.html
SOURCE Darling Ingredients Inc.
IRVING, Texas, May 24, 2017 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) (the "Company") today announced that management will participate in two investor conferences in June.
On Wednesday, June 7, Randall C. Stuewe, Darling's Chairman and Chief Executive Officer, will present at the Baird 2017 Global Consumer, Technology and Services Conference at 11:25 a.m. EDT being held at the InterContinental New York Barclay hotel. He will be hosting one-on-one meetings throughout the day along with Patrick Lynch, Executive Vice President and Chief Financial Officer, and Melissa Gaither, Vice President Investor Relations and Global Communications. The investor presentation will be webcast and accessible via the Investor Relations section of the Company's website at http://www.darlingii.com.
Additionally, Mr. Stuewe will present at the Citi 2017 Small & Mid Cap Conference at the Plaza Hotel in New York. Management is scheduled to present Thursday, June 8 at 9:30 a.m. EDT. Mr. Stuewe will be joined by Mr. Lynch and Ms. Gaither for one-on-one meetings.
About Darling
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at http://www.darlingii.com.
For More Information, contact: |
|
Melissa A. Gaither, V.P. Investor Relations and Global Communications |
Email: mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300 |
|
Irving, Texas 75038 |
Phone: 972-717-0300 |
SOURCE Darling Ingredients Inc.
IRVING, Texas, May 11, 2017 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR), a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy, and fertilizer industries, today announced financial results for the 2017 first quarter ended April 1, 2017.
First Quarter 2017 Overview
For the first quarter of 2017, the Company reported net sales of $880.1 million, as compared with net sales of $779.6 million for the first quarter of 2016. Net income attributable to Darling for the three months ended April 1, 2017 was $5.8 million, or $0.04 per diluted share, compared to a net income of $1.1 million, or $0.01 per diluted share, for the first quarter of 2016. The increase in net income for the first quarter 2017 is primarily due to higher finished product pricing for fats and proteins offset by the absence of the blenders tax credit, which was reported in the first quarter 2016 but which has not yet been reinstated for 2017.
Comments on the First Quarter 2017
"We capitalized on an improved environment with our first quarter results reflecting solid execution across our global platform leveraged by sequentially consistent and improved performance in our Feed and Food segments. Sequentially, Fuel segment results reflect the lack of the blenders tax credit and one-time settlements received last quarter," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "Diamond Green Diesel completed its second maintenance turnaround and issued a partner dividend of $25 million each. Our planned expansion of Diamond Green Diesel is progressing well and we continue to focus on growing our global platform while improving efficiencies and increasing capital returns. We're off to a good start in 2017."
Operational Update by Segment
Financial Update by Segment
Feed Ingredients |
Three Months Ended | ||
($ thousands) |
April 1, 2017 |
April 2, 2016 | |
Net Sales |
$ 552,624 |
$ 476,171 | |
Selling, general and administrative expenses |
45,467 |
45,251 | |
Depreciation and amortization |
43,719 |
44,377 | |
Segment operating Income |
30,828 |
13,886 | |
EBITDA |
$ 74,547 |
$ 58,263 |
*EBITDA calculated by adding depreciation and amortization to segment operating income. |
Food Ingredients |
Three Months Ended | ||
($ thousands) |
April 1, 2017 |
April 2, 2016 | |
Net Sales |
$ 267,788 |
$ 247,897 | |
Selling, general and administrative expenses |
25,059 |
23,759 | |
Depreciation and amortization |
17,601 |
16,704 | |
Segment operating Income |
14,127 |
21,880 | |
EBITDA |
$ 31,728 |
$ 38,584 |
*EBITDA calculated by adding depreciation and amortization to segment operating income. |
Fuel Ingredients |
Three Months Ended | ||
($ thousands) |
April 1, 2017 |
April 2, 2016 | |
Net Sales |
$ 59,660 |
$ 55,573 | |
Selling, general and administrative expenses |
3,291 |
1,850 | |
Depreciation and amortization |
6,845 |
6,919 | |
Segment operating Income |
3,508 |
6,122 | |
EBITDA |
$ 10,353 |
$ 13,041 |
*EBITDA calculated by adding depreciation and amortization to segment operating income. |
Darling Ingredients Inc. and Subsidiaries Consolidated Operating Results For the Periods Ended April 1, 2017 and April 2, 2016 (in thousands, except per share data) (unaudited) | ||||||
Three Months Ended | ||||||
$ Change | ||||||
April 1, |
April 2, |
Favorable | ||||
2017 |
2016 |
(Unfavorable) | ||||
Net sales |
$ 880,072 |
$ 779,641 |
$ 100,431 | |||
Costs and expenses: |
||||||
Cost of sales and |
689,627 |
598,893 |
(90,734) | |||
Selling, general and |
87,917 |
81,469 |
(6,448) | |||
Depreciation and amortization |
71,114 |
72,256 |
1,142 | |||
Acquisition and integration costs |
- |
331 |
331 | |||
Total costs and expenses |
848,658 |
752,949 |
(95,709) | |||
Operating income |
31,414 |
26,692 |
4,722 | |||
Other expense: |
||||||
Interest expense |
(21,680) |
(23,901) |
2,221 | |||
Foreign currency loss |
(264) |
(2,603) |
2,339 | |||
Other expense, net |
(960) |
(1,305) |
345 | |||
Total other expense |
(22,904) |
(27,809) |
4,905 | |||
Equity in net income of unconsolidated subsidiary |
706 |
5,643 |
(4,937) | |||
Income before income taxes |
9,216 |
4,526 |
4,690 | |||
Income tax expense |
1,818 |
1,863 |
45 | |||
Net income |
7,398 |
2,663 |
4,735 | |||
Net income attributable to noncontrolling interests |
(1,569) |
(1,584) |
15 | |||
Net income attributable to Darling |
$ 5,829 |
$ 1,079 |
$ 4,750 | |||
Basic income per share |
$ 0.04 |
$ 0.01 |
$ 0.03 | |||
Diluted income per share |
$ 0.04 |
$ 0.01 |
$ 0.03 |
Darling Ingredients Inc. and Subsidiaries | ||||
April 1, |
December 31, | |||
2017 |
2016 | |||
ASSETS |
(unaudited) |
|||
Current assets: |
||||
Cash and cash equivalents |
$ 138,880 |
$ 114,564 | ||
Restricted cash |
282 |
293 | ||
Accounts Receivable, net |
389,864 |
388,397 | ||
Inventories |
342,114 |
330,815 | ||
Prepaid expenses |
32,852 |
29,984 | ||
Income taxes refundable |
6,978 |
7,479 | ||
Other current assets |
16,331 |
21,770 | ||
Total current assets |
927,301 |
893,302 | ||
Property, plant and equipment, |
||||
less accumulated depreciation, net |
1,532,583 |
1,515,575 | ||
Intangible assets, |
||||
less accumulated amortization, net |
697,820 |
711,927 | ||
Goodwill |
1,233,271 |
1,225,893 | ||
Investment in unconsolidated subsidiaries |
270,921 |
292,717 | ||
Other assets |
42,138 |
43,613 | ||
Deferred income taxes |
15,627 |
14,990 | ||
Total assets |
$ 4,719,661 |
$ 4,698,017 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||
Current liabilities: |
||||
Current portion of long-term debt |
$ 24,965 |
$ 23,247 | ||
Accounts payable, principally trade |
181,439 |
180,895 | ||
Income taxes payable |
12,066 |
4,913 | ||
Accrued expenses |
233,324 |
242,796 | ||
Total current liabilities |
451,794 |
451,851 | ||
Long-term debt, net of current portion |
1,727,496 |
1,727,696 | ||
Other non-current liabilities |
95,720 |
96,114 | ||
Deferred income taxes |
340,814 |
346,134 | ||
Total liabilities |
2,615,824 |
2,621,795 | ||
Commitments and contingencies |
||||
Total Darling's stockholders' equity: |
1,999,362 |
1,972,994 | ||
Noncontrolling interests |
104,475 |
103,228 | ||
Total stockholders' equity |
$2,103,837 |
$ 2,076,222 | ||
$4,719,661 |
$ 4,698,017 |
Darling Ingredients Inc. and Subsidiaries Consolidated Statement of Cash Flows Fiscal Years Ended April 1, 2017 and April 2, 2016 (in thousands) (unaudited) | ||||||
Three Months Ended | ||||||
April 1, |
April 2, | |||||
Cash flows from operating activities: |
2017 |
2016 | ||||
Net income |
$ 7,398 |
$ 2,663 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||
Depreciation and amortization |
71,114 |
72,256 | ||||
Loss on disposal of property, plant, equipment and other assets |
(125) |
698 | ||||
Deferred taxes |
(8,454) |
(3,705) | ||||
Increase/(decrease) in long-term pension liability |
702 |
(1,146) | ||||
Stock-based compensation expense |
6,732 |
2,440 | ||||
Deferred loan cost amortization |
2,176 |
2,794 | ||||
Equity in net (income) of unconsolidated subsidiaries |
(706) |
(5,643) | ||||
Distribution of earnings from unconsolidated subsidiaries |
25,000 |
- | ||||
Changes in operating assets and liabilities, net of effects from acquisitions: |
||||||
Accounts receivable |
(753) |
7,118 | ||||
Income taxes refundable/payable |
7,576 |
400 | ||||
Inventories and prepaid expenses |
(10,660) |
(21,206) | ||||
Accounts payable and accrued expenses |
(8,365) |
3,336 | ||||
Other |
2,834 |
(14,962) | ||||
Net cash provided by operating activities |
94,469 |
45,043 | ||||
Cash flows from investing activities: |
||||||
Capital expenditures |
(62,292) |
(53,375) | ||||
Acquisitions, net of cash acquired |
- |
(8,511) | ||||
Investment of unconsolidated subsidiaries |
(2,250) |
- | ||||
Gross proceeds from disposal of property, plant and equipment and other assets |
1,340 |
1,424 | ||||
Proceeds from insurance settlement |
3,301 |
1,181 | ||||
Net cash used by investing activities |
(59,901) |
(59,281) | ||||
Cash flows from financing activities: |
||||||
Proceeds from long-term debt |
8,649 |
8,760 | ||||
Payments on long-term debt |
(9,265) |
(16,207) | ||||
Borrowings from revolving credit facility |
47,000 |
33,000 | ||||
Payments on revolving credit facility |
(52,327) |
(21,000) | ||||
Net cash overdraft financing |
(1,077) |
− | ||||
Deferred loan costs |
(1,135) |
− | ||||
Issuance of common stock |
22 |
45 | ||||
Repurchase of treasury stock |
− |
(5,000) | ||||
Minimum withholding taxes paid on stock awards |
(1,995) |
(1,788) | ||||
Excess tax benefits from stock-based compensation |
− |
(446) | ||||
Distributions to noncontrolling interests |
(433) |
− | ||||
Net cash used by financing activities |
(10,561) |
(2,636) | ||||
Effect of exchange rate changes on cash |
309 |
7,316 | ||||
Net increase/(decrease) in cash and cash equivalents |
24,316 |
(9,558) | ||||
Cash and cash equivalents at beginning of period |
114,564 |
156,884 | ||||
Cash and cash equivalents at end of period |
$ 138,880 |
$ 147,326 | ||||
Supplemental disclosure of cash flow information: |
||||||
Accrued capital expenditures |
$ (2,787) |
$ (6,595) | ||||
Cash paid during the period for: |
||||||
Interest, net of capitalized interest |
$ 19,022 |
$ 20,597 | ||||
Income taxes, net of refunds |
$ 2,429 |
$ 5,114 | ||||
Non-cash financing activities: |
||||||
Debt issued for assets |
$ - |
$ 10 | ||||
Contribution of assets to unconsolidated subsidiary |
$ - |
$ 2,674 |
Selected financial information for the Company's Diamond Green Diesel Joint Venture is as follows:
Diamond Green Diesel Joint Venture Condensed Consolidated Balance Sheets Three Months Ended March 31, 2017 and December 31, 2016 (in thousands) | |||||
March 31, |
December 31, | ||||
2017 |
2016 | ||||
Assets: |
(unaudited) |
||||
Total current assets |
$ 212,915 |
$ 268,734 | |||
Property, plant and equipment, net |
360,476 |
354,871 | |||
Other assets |
10,226 |
12,164 | |||
Total assets |
$ 583,617 |
$ 635,769 | |||
Liabilities and members' equity: |
|||||
Total current portion of long term debt |
$ 17,023 |
$ 17,023 | |||
Total other current liabilities |
24,100 |
23,200 | |||
Total long term debt |
49,497 |
53,753 | |||
Total other long term liabilities |
427 |
418 | |||
Total members' equity |
492,570 |
541,375 | |||
Total liabilities and members' equity |
$ 583,617 |
$ 635,769 |
Diamond Green Diesel Joint Venture Operating Financial Results Three Months Ended March 31, 2017 and March 31, 2016 (in thousands) (unaudited) | |||||||
Three Months Ended | |||||||
$ Change | |||||||
March 31, |
March 31, |
Favorable | |||||
Revenues: |
2017 |
2016 |
(Unfavorable) | ||||
Operating revenues |
$ 125,397 |
$ 71,768 |
$ 53,629 | ||||
Expenses: |
|||||||
Total costs and expenses less depreciation, amortization and accretion expense |
115,322 |
52,509 |
(62,813) | ||||
Depreciation, amortization and accretion expense |
8,113 |
5,378 |
(2,735) | ||||
Operating income: |
1,962 |
13,881 |
(11,919) | ||||
Other income |
223 |
15 |
208 | ||||
Interest and debt expense, net |
(990) |
(2,814) |
1,824 | ||||
Net income |
$ 1,195 |
$ 11,082 |
$ (9,887) |
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 | ||||
Three Months Ended - Year over Year | ||||
Adjusted EBITDA |
April 1, |
April 2, | ||
(U.S. dollars in thousands) |
2017 |
2016 | ||
Net income attributable to Darling |
$ 5,829 |
$ 1,079 | ||
Depreciation and amortization |
71,114 |
72,256 | ||
Interest expense |
21,680 |
23,901 | ||
Income tax expense |
1,818 |
1,863 | ||
Foreign currency loss |
264 |
2,603 | ||
Other expense, net |
960 |
1,305 | ||
Equity in net (income) of unconsolidated subsidiary |
(706) |
(5,643) | ||
Net income attributable to noncontrolling interests |
1,569 |
1,584 | ||
Adjusted EBITDA |
$ 102,528 |
$ 98,948 | ||
Acquisition and integration-related expenses |
- |
331 | ||
Pro forma Adjusted EBITDA (Non-GAAP) |
$ 102,528 |
$ 99,279 | ||
Foreign currency exchange impact (1) |
1,832 |
- | ||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) |
$ 104,360 |
$ 99,279 | ||
DGD Joint Venture Adjusted EBITDA (Darling's share) |
$ 5,037 |
$ 9,629 | ||
(1) The average rates assumption used in the calculation was the actual fiscal average rate for the three months ended April 2, 2016 of €1.00:USD$1.10 and CAD$1.00:USD$0.73 as compared to the average rate for the three months ended April 1, 2017 of €1.00:USD$1.07 and CAD$1.00:USD$0.75, respectively. |
Reconciliation of Net Income to (Non-GAAP) Adjusted EBITDA and (Non-GAAP) Pro forma Adjusted EBITDA | ||||
Three Months Ended - Sequential | ||||
Adjusted EBITDA |
April 1, |
December 31, | ||
(U.S. dollars in thousands) |
2017 |
2016 | ||
Net income attributable to Darling |
$ 5,829 |
$ 40,541 | ||
Depreciation and amortization |
71,114 |
77,468 | ||
Interest expense |
21,680 |
22,439 | ||
Income tax expense |
1,818 |
6,213 | ||
Foreign currency loss/(gain) |
264 |
(387) | ||
Other expense/(income), net |
960 |
(1,819) | ||
Equity in net (income) of unconsolidated subsidiary |
(706) |
(32,746) | ||
Net income attributable to noncontrolling interests |
1,569 |
1,139 | ||
Adjusted EBITDA |
$ 102,528 |
$ 112,848 | ||
Foreign currency exchange impact (1) |
583 |
- | ||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) |
$ 103,111 |
$ 112,848 | ||
DGD Joint Venture Adjusted EBITDA (Darling's share) |
$ 5,037 |
$ 36,721 | ||
(1) The average rates assumption used in this calculation was the actual fiscal average rate for the three months ended December 31, 2016 of €1.00:USD$1.08 and CAD$1.00:USD$0.75 as compared to the average rate for the three months ended April 1, 2017 of €1.00:USD$1.07 and CAD$1.00:USD$0.75, respectively. |
About Darling
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty products for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into broadly used and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. 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 first quarter 2017 financial results at 8:30 am Eastern Time (7:30 am Central Time) on Friday, May 12, 2017. To listen to the conference call, participants calling from within North America should dial 844-868-8847; international participants should dial 412-317-6593. Please refer to access code 10104353. 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 May 23, 2017, by dialing 877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 412-317-0088 (international callers). The access code for the replay is 10104353. 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 expenses, 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.
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 and 5.375% Notes and 4.75% Notes that were outstanding at April 1, 2017. 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 and 5.375% Notes and 4.75% 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.
Cautionary Statements Regarding Forward-Looking Information:
{This media release contains "forward-looking" statements regarding the business operations and prospects of Darling Ingredients Inc., including its Diamond Green Diesel joint venture, 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," "assumption," 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 emissions that adversely affect programs like the Renewable Fuel Standards Program (RFS2), low carbon fuel standards (LCFS) and tax credits for biofuels both in the Unites States and abroad; possible product recall resulting from developments relating to the discovery of unauthorized adulterations to food or food additives; the occurrence of Bird Flu including, but not limited to H5N1 flu, bovine spongiform encephalopathy (or "BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere; 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 regulations (including, without limitation, China) affecting the industries in which the Company operates or its value added products (including new or modified animal feed, Bird Flu, PED or BSE or similar or unanticipated regulations); risks associated with the renewable diesel plant in Norco, Louisiana owned and operated by a joint venture between Darling Ingredients and Valero Energy Corporation, including possible unanticipated operating disruptions and issues related to the announced expansion project; difficulties or a significant disruption in our information systems or failure to implement new systems and software successfully, including our ongoing enterprise resource planning project; 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 likely 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 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: | |
Melissa A. Gaither, VP IR and Global Communications |
Email : mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300, Irving, Texas 75038 |
Phone : 972-717-0300 |
SOURCE Darling Ingredients Inc.
IRVING, Texas, Jan. 11, 2017 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) (the "Company") today announced that management will present at the 13th Annual BNP Paribas High Yield & Leveraged Finance Conference to be held at the Landmark hotel in London. Randall C. Stuewe, Darling's Chairman and Chief Executive Officer, is scheduled to present on Thursday, January 19, at 11:40 a.m. GMT, and will hold one-on-one meetings throughout the day. Randy will be joined by John Muse, Executive Vice President – Chief Financial Officer, Patrick Lynch, Darling's newly appointed Executive Vice President – Chief Administrative Officer effective January 15, 2017, and Melissa Gaither, Vice President Investor Relations and Global Communications.
About Darling
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at http://www.darlingii.com.
Safe Harbor Statement
Some of the statements made in this press release are forward-looking statements. These forward-looking statements are based upon our current expectations and projections about future events and generally relate to our plans, objectives and expectations for the development of our business. Although management believes that the plans and objectives reflected in or suggested by these forward-looking statements are reasonable, all forward-looking statements involve risks and uncertainties and actual future results may be materially different from the plans, objectives and expectations expressed in this press release. Many of these risks and uncertainties are described in Darling's Annual Report on Form 10-K for the year ending January 2, 2016 and our other filings with the SEC.
For More Information, contact: |
|
Melissa A. Gaither, V.P. Investor Relations and Global Communications |
Email: mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300 |
|
Irving, Texas 75038 |
Phone: 972-717-0300 |
SOURCE Darling Ingredients Inc.
IRVING, Texas, May 31, 2016 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) will host a conference call and webcast on Tuesday, June 7, 2016 to present Darling's views on the biofuel industry including an up-date on the Renewable Fuel Standard mandates and Low Carbon Fuel Standard (LCFS) programs globally with a focus on California. The teleconference will begin at 9:00 a.m. EDT and will be hosted by Mr. Randall Stuewe, CEO and Chairman of the Board, and Mr. John Bullock, EVP Chief Strategy Officer. The call will consist of a short intro to the above listed biofuel industry issues augmented by a slide presentation available via the investor relations section of the Company's website at http://ir.darlingii.com. Management will also be available for questions during the call.
To participate in the conference call on Tuesday, June 7, 2016 at 9:00 am Eastern Time (8:00 am Central Time), participants calling from within North America should dial 866-777-2509; and International participants should dial 412-317-5413. Please refer to access code 10087275. Please call approximately ten minutes before the start of the call to ensure that you are connected.
Participants can pre-register for the teleconference with the following link: http://dpregister.com/10087275 . Registered participants will receive an email with a calendar reminder, dial-in number and PIN that allows immediate access to the call on June 7, 2016.
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 June 15, 2016, by dialing 877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 412-669-9658 (International callers). The access code for the replay is 10087275. The conference call will also be archived on the Company's website.
ABOUT DARLING
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty products for customers in the food, pet food, pharmaceutical, feed, industrial, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into broadly used and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at http://ir.darlingii.com.
For More Information, contact: |
|
Melissa A. Gaither, VP Investor Relations and |
251 O'Connor Ridge Blvd., Suite 300 |
Global Communications |
Irving, Texas 75038 |
Phone: 972-717-0300 |
SOURCE Darling Ingredients Inc.
IRVING, Texas, May 12, 2016 /PRNewswire/ --
1ST Quarter 2016 Highlights
Darling Ingredients Inc. (NYSE: DAR), a global leader in converting edible and inedible bio-nutrient streams into a wide range of ingredients and specialty products for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy, and fertilizer industries, today announced financial results for the first quarter ended April 2, 2016.
For the first quarter of 2016, the Company reported net sales of $779.6 million, as compared with net sales of $874.7 million for the first quarter of 2015. The $95.1 million decrease in net sales is primarily attributable to weaker selling prices for fats and protein within the Feed Ingredients segment and continued FX translation impacts. Overall, global raw material volumes were stronger year over year.
Net income attributable to Darling for the three months ended April 2, 2016, was $1.1 million, or $0.01 per diluted share, compared to a net income of $0.1 million, or $0.00 per diluted share, for the three months ended April 4, 2015. Adjusted EBITDA for Darling for the three months ended April 2, 2016 was $98.9 million compared to Adjusted EBITDA of $98.2 million for the three months ended April 4, 2015. The $0.7 million increase in Adjusted EBITDA is primarily attributable to increased earnings in the Food and Fuel Ingredients segments and higher raw material volumes in the Feed Ingredients segment that more than offset lower finished product prices and the impact of foreign exchange.
Comments on the First Quarter 2016
Randall C. Stuewe, Darlings Ingredients Inc. Chairman and Chief Executive Officer, said of the Company's quarterly performance, "Sequentially, our segments showed nice consistency in light of very volatile markets around the globe. Most notably, our Food segment delivered solidly with Rousselot and Sonac delivering consistent earnings. In the Feed segment, we saw our global rendering businesses once again adjust to falling protein prices during the quarter but volume increases and strengthening fat prices partially offset the headwinds. Our Fuel segment, when normalized for the blender's tax credit, showed a very consistent performance. Looking forward, we have seen both protein and fat prices significantly strengthen late in the quarter and we should see our Feed segment realize the benefit in the second quarter. Our model is clearly working and we are picking up momentum once again," concluded Mr. Stuewe.
Operational Update by Segment
Reconciliation of First Quarter Net Income to Adjusted EBITDA (Non-GAAP) and Pro Forma Adjusted EBITDA
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). The Company believes that Adjusted EBITDA provides additional useful information to investors. As the Company uses the term, Adjusted EBITDA, is calculated below:
Three Months Ended - Year over Year | ||||
Adjusted EBITDA |
April 2, |
April 4, | ||
(U.S. dollars in thousands) |
2016 |
2015 | ||
Net income attributable to Darling |
$ 1,079 |
$ 109 | ||
Depreciation and amortization |
72,256 |
66,398 | ||
Interest expense |
23,901 |
23,109 | ||
Income tax expense |
1,863 |
2,115 | ||
Foreign currency loss |
2,603 |
2,460 | ||
Other expense, net |
1,305 |
509 | ||
Equity in net (income)/loss of unconsolidated subsidiary |
(5,643) |
1,808 | ||
Net income attributable to noncontrolling interests |
1,584 |
1,715 | ||
Adjusted EBITDA |
$ 98,948 |
$ 98,223 | ||
Acquisition and integration-related expenses |
331 |
5,319 | ||
Pro forma Adjusted EBITDA (Non-GAAP) |
$ 99,279 |
$ 103,542 | ||
Foreign currency exchange impact |
2,260 |
- | ||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) |
$ 101,539 |
$ 103,542 | ||
DGD Joint Venture Adjusted EBITDA (Darling's share) (1) |
$ 9,629 |
$ 2,346 |
(1) |
Darling's Pro forma Adjusted EBITDA (Non-GAAP) in the above table does not include the DGD Joint Venture Adjusted EBITDA (Darling's share) if we had consolidated the DGD Joint Venture. |
For the three months ended April 2, 2016, the Company generated Adjusted EBITDA of $98.9 million, as compared to $98.2 million in the same period in fiscal 2015. The increase was primarily attributable to increased earnings in the Food and Fuel Ingredients segments and higher raw material volumes in the Feed Ingredients segment that more than offset lower finished product prices attributable to lower global competing ingredient prices and the impact of foreign exchange rates as a function of the strengthening U.S. dollar as compared mainly to the euro and Canadian dollar. On a Pro forma Adjusted EBITDA basis, the Company would have generated $99.3 million in the three months ended April 2, 2016, as compared to a Pro forma Adjusted EBITDA of $103.5 million in the same period in 2015. The decrease in the Pro forma Adjusted EBITDA is attributable to lower finished product prices, the impact of foreign exchange rates as a function of the strengthening U.S. dollar as compared mainly to the euro and Canadian dollar and lower acquisition and integration-related expense, which were partially offset by an increase in raw material volumes.
The above Pro forma Adjusted EBITDA results for the three months ended April 2, 2016 would have been $101.5 million when taking into consideration the change in average foreign currency fluctuations of $2.3 million, as compared to $103.5 million for the same period in fiscal 2015, a reduction of $2.0 million.
Financial Update by Segment
Feed Ingredients |
Three Months Ended | ||
($ thousands) |
April 2, 2016 |
April 4, 2015 | |
Net Sales |
$ 476,171 |
$ 547,498 | |
Segment operating Income |
$ 13,886 |
$ 35,414 | |
EBITDA |
$ 58,263 |
$ 75,469 |
Food Ingredients |
Three Months Ended | ||
($ thousands) |
April 2, 2016 |
April 4, 2015 | |
Net Sales |
$ 247,897 |
$ 270,157 | |
Segment operating Income |
$ 21,880 |
$ 10,847 | |
EBITDA |
$ 38,584 |
$ 28,044 |
Fuel Ingredients |
Three Months Ended | ||
($ thousands) |
April 2, 2016 |
April 4, 2015 | |
Net Sales |
$ 55,573 |
$ 57,039 | |
Segment operating Income |
$ 6,122 |
$ 2,494 | |
EBITDA |
$ 13,041 |
$ 9,125 |
About Darling
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty products for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into broadly used and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at http://ir.darlingii.com.
Darling Ingredients Inc. will host a conference call to discuss the Company's first quarter 2016 financial results at 8:30 am Eastern Time (7:30 am Central Time) on Friday, May 13, 2016. To listen to the conference call, participants calling from within North America should dial 1-866-777-2509; international participants should dial 1-412-317-5413. Please refer to access code 10085015. 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 May 20, 2016 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 10085015. The conference call will also be archived on the Company's website.
Use of Non-GAAP Financial Measures:
Adjusted EBITDA is presented here not as an alternative to net income, but rather as a measure of the Company's operating performance and is not intended to be a presentation in accordance with GAAP. Since EBITDA (generally, net income plus interest expenses, 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.
As a result, the Company's management uses Adjusted EBITDA as a measure to evaluate performance and for other discretionary purposes. However, Adjusted EBITDA is not a recognized measurement under GAAP, should not be considered as an alternative to net income as a measure of operating results or to cash flow as a measure of liquidity, and is not intended to be a presentation in accordance with GAAP. 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 and 5.375% Notes and 4.75% Notes that were outstanding at April 2, 2016. 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 and 5.375% Notes and 4.75% Notes, as those definitions permit further adjustments to reflect certain other non-recurring costs and non-cash charges. Additionally, the Company evaluates the impact of foreign exchange on operating cash flow, which is defined as segment operating income (loss) plus depreciation and amortization.
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," 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, reduced demand for animal feed, or otherwise; 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 emissions that adversely affect programs like the Renewable Fuel Standards Program (RFS2), low carbon fuel standards (LCFS) and tax credits for biofuels both in the Unites States and abroad; possible product recall resulting from developments relating to the discovery of unauthorized adulterations to food or food additives; the occurrence of Bird Flu including, but not limited to H5N1 flu, bovine spongiform encephalopathy (or "BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere; 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 regulations (including, without limitation, China) affecting the industries in which the Company operates or its value added products (including new or modified animal feed, Bird Flu, PED or BSE or similar or unanticipated regulations); risks associated with the renewable diesel plant in Norco, Louisiana owned and operated by a joint venture between Darling Ingredients and Valero Energy Corporation, including possible unanticipated operating disruptions and issues related to the announced expansion project; difficulties or a significant disruption in our information systems or failure to implement new systems and software successfully, including our ongoing enterprise resource planning project; 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; 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 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: Melissa A. Gaither, V.P. Investor Relations and Global Communications 251 O'Connor Ridge Blvd., Suite 300 Irving, Texas 75038 |
Email: mgaither@darlingii.com Phone: 972-717-0300 |
Darling Ingredients Inc. and Subsidiaries | ||||
April 2, |
January 2, | |||
2016 |
2016 | |||
(unaudited) |
||||
Current assets: |
||||
Cash and cash equivalents |
$ 147,326 |
$ 156,884 | ||
Restricted cash |
321 |
331 | ||
Accounts Receivable, net |
376,346 |
371,392 | ||
Inventories |
372,616 |
344,583 | ||
Prepaid expenses |
40,279 |
36,175 | ||
Income taxes refundable |
11,825 |
11,963 | ||
Other current assets |
11,570 |
10,460 | ||
Total current assets |
960,283 |
931,788 | ||
Property, plant and equipment, less accumulated depreciation, net |
1,535,521 |
1,508,167 | ||
Intangible assets, less accumulated amortization, net |
792,166 |
782,349 | ||
Other assets: |
||||
Goodwill |
1,269,296 |
1,233,102 | ||
Investment in unconsolidated subsidiaries |
256,604 |
247,238 | ||
Other assets |
40,584 |
41,623 | ||
Deferred income taxes |
17,362 |
16,352 | ||
Total assets |
$ 4,871,816 |
$ 4,760,619 | ||
Current liabilities: |
||||
Current portion of long-term debt |
$ 46,591 |
$ 45,166 | ||
Accounts payable, principally trade |
170,895 |
149,998 | ||
Income taxes payable |
7,032 |
6,679 | ||
Accrued expenses |
227,338 |
239,825 | ||
Total current liabilities |
451,856 |
441,668 | ||
Long-term debt, net of current portion |
1,924,393 |
1,885,851 | ||
Other non-current liabilities |
96,116 |
97,809 | ||
Deferred income taxes |
368,640 |
360,681 | ||
Total liabilities |
2,841,005 |
2,786,009 | ||
Commitments and contingencies |
||||
Total Darling's stockholders' equity: |
1,927,330 |
1,870,709 | ||
Noncontrolling interests |
103,481 |
103,901 | ||
Total stockholders' equity |
$2,031,811 |
$1,974,610 | ||
$4,871,816 |
$4,760,619 |
Darling Ingredients Inc. and Subsidiaries | ||||||
Three Months Ended | ||||||
$ Change | ||||||
April 2, |
April 4, |
Favorable | ||||
2016 |
2015 |
(Unfavorable) | ||||
Net sales |
$ 779,641 |
$ 874,694 |
$ (95,053) | |||
Costs and expenses: |
||||||
Cost of sales and operating expenses |
$ 598,893 |
$ 684,521 |
$ 85,628 | |||
Selling, general and administrative expenses |
81,469 |
86,631 |
5,162 | |||
Depreciation and amortization |
72,256 |
66,398 |
(5,858) | |||
Acquisition and integration costs |
331 |
5,319 |
4,988 | |||
Total costs and expenses |
752,949 |
842,869 |
89,920 | |||
Operating income |
26,692 |
31,825 |
(5,133) | |||
Other expense: |
||||||
Interest expense |
(23,901) |
(23,109) |
(792) | |||
Foreign currency loss |
(2,603) |
(2,460) |
(143) | |||
Other expense, net |
(1,305) |
(509) |
(796) | |||
Total other expense |
(27,809) |
(26,078) |
(1,731) | |||
Equity in net income/(loss) of unconsolidated subsidiary |
5,643 |
(1,808) |
7,451 | |||
Income before income taxes |
4,526 |
3,939 |
587 | |||
Income tax expense |
1,863 |
2,115 |
252 | |||
Net income |
$ 2,663 |
$ 1,824 |
$ 839 | |||
Net income attributable to noncontrolling interests |
$ (1,584) |
$ (1,715) |
$ 131 | |||
Net income attributable to Darling |
$ 1,079 |
$ 109 |
$ 970 | |||
Basic income per share |
$ 0.01 |
$ - |
$ 0.01 | |||
Diluted income per share |
$ 0.01 |
$ - |
$ 0.01 |
Darling Ingredients Inc. and Subsidiaries | ||||||
Three Months Ended | ||||||
April 2, |
April 4, | |||||
Cash flows from operating activities: |
2016 |
2015 | ||||
Net income |
$ 2,663 |
$ 1,824 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||
Depreciation and amortization |
72,256 |
66,398 | ||||
Loss on disposal of property, plant, equipment and other assets |
698 |
47 | ||||
Gain on insurance proceeds from insurance settlements |
− |
(341) | ||||
Deferred taxes |
(3,705) |
503 | ||||
Increase/(decrease) in long-term pension liability |
(1,146) |
261 | ||||
Stock-based compensation expense |
2,440 |
1,282 | ||||
Deferred loan cost amortization |
2,794 |
2,409 | ||||
Equity in net (income)/loss of unconsolidated subsidiaries |
(5,643) |
1,808 | ||||
Changes in operating assets and liabilities, net of effects from acquisitions: |
||||||
Accounts receivable |
7,118 |
12,269 | ||||
Income taxes refundable/payable |
400 |
(1,857) | ||||
Inventories and prepaid expenses |
(21,206) |
(26,511) | ||||
Accounts payable and accrued expenses |
3,336 |
(19,985) | ||||
Other |
(14,962) |
21,133 | ||||
Net cash provided/(used) by operating activities |
45,043 |
59,240 | ||||
Cash flows from investing activities: |
||||||
Capital expenditures |
(53,375) |
(50,838) | ||||
Acquisitions, net of cash acquired |
(8,511) |
− | ||||
Gross proceeds from disposal of property, plant and equipment and other assets |
1,424 |
534 | ||||
Proceeds from insurance settlement |
1,181 |
341 | ||||
Payments related to routes and other intangibles |
− |
(753) | ||||
Net cash used by investing activities |
(59,281) |
(50,716) | ||||
Cash flows from financing activities: |
||||||
Proceeds from long-term debt |
8,760 |
5,943 | ||||
Payments on long-term debt |
(16,207) |
(13,602) | ||||
Borrowings from revolving credit facility |
33,000 |
27,428 | ||||
Payments on revolving credit facility |
(21,000) |
(37,943) | ||||
Net cash overdraft financing |
− |
31,162 | ||||
Issuance of commons stock |
45 |
81 | ||||
Repurchase of treasury stock |
(5,000) |
− | ||||
Minimum withholding taxes paid on stock awards |
(1,788) |
(4,469) | ||||
Excess tax benefits from stock-based compensation |
(446) |
(35) | ||||
Distributions to noncontrolling interests |
− |
(38) | ||||
Net cash provided/(used) by financing activities |
(2,636) |
8,527 | ||||
Effect of exchange rate changes on cash |
7,316 |
(13,704) | ||||
Net increase/(decrease) in cash and cash equivalents |
(9,558) |
3,347 | ||||
Cash and cash equivalents at beginning of period |
156,884 |
108,784 | ||||
Cash and cash equivalents at end of period |
$ 147,326 |
$ 112,131 | ||||
Supplemental disclosure of cash flow information: |
||||||
Accrued capital expenditures |
$ (6,595) |
$ 2,164 | ||||
Cash paid during the period for: |
||||||
Interest, net of capitalized interest |
$ 20,597 |
$ 26,118 | ||||
Income taxes, net of refunds |
$ 5,114 |
$ 5,149 | ||||
Non-cash financing activities: |
||||||
Debt issued for service contract assets |
$ 10 |
$ - | ||||
Contribution of property to unconsolidated subsidiary |
$ 2,674 |
$ - |
SOURCE Darling Ingredients Inc.
IRVING, Texas, April 7, 2016 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR) announced today an expansion of the Diamond Green Diesel (DGD) facility in Norco, LA. DGD is the Company's joint venture with Valero Energy Corporation. The expansion will grow the facility's annual production capacity from 160 million gallons of renewable diesel to 275 million gallons. The incremental cost per gallon of renewable diesel production for the expansion is estimated to be approximately one-half of the green field construction cost due to significant logistics and processing facilities already in place. This expansion plan is expected to be funded by DGD cash flow and is subject to final engineering and cost analysis. DGD estimates completion in the fourth quarter of 2017, with production expected to ramp-up in the first quarter of 2018. DGD expects to operate at full capacity throughout the expansion phase, excluding an estimated 15-to-30 days of necessary downtime for final tie-ins. The planned expansion will also include expanded outbound logistics for servicing the many developing low carbon fuel markets around North America and the globe.
"Our Diamond Green Diesel joint venture continues to be a shining star in our portfolio of ingredients and our DGD team has successfully proven the technology works, producing the highest quality product to meet the expectations of our customers," commented Randall C. Stuewe, Darling Ingredients Inc. Chairman and Chief Executive Officer, on the planned expansion.
About Darling
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into useable and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at http://ir.darlingii.com.
Safe Harbor Statement
Some of the statements made in this press release are forward-looking statements. These forward-looking statements are based upon our current expectations and projections about future events and generally relate to our plans, objectives and expectations for the development of our business. Although management believes that the plans and objectives reflected in or suggested by these forward-looking statements are reasonable, all forward-looking statements involve risks and uncertainties and actual future results may be materially different from the plans, objectives and expectations expressed in this press release. Many of these risks and uncertainties are described in Darling's Annual Report on Form 10-K for the year ending January 2, 2016 and our other filings with the SEC.
For More Information, contact: |
|
Melissa A. Gaither, V.P. Investor Relations and Global Communications |
Email: mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300 |
Phone: 972-717-0300 |
Irving, Texas 75038 |
SOURCE Darling Ingredients Inc.
IRVING, Texas, March 1, 2016 /PRNewswire/ --
4th Quarter 2015 Highlights
Fiscal 2015 Highlights
Darling Ingredients Inc. (NYSE: DAR), a global leader in converting edible and inedible bio-nutrient streams into a wide range of ingredients and specialty products for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries, today announced financial results for the fiscal 2015 fourth quarter and year ended January 2, 2016.
For the fourth quarter of 2015, the Company reported net sales of $809.7 million, as compared with net sales of $1 billion for the fourth quarter of 2014. The $190.5 million decrease in net sales is attributable to sustained weakness in global commodity markets and continued FX translation impacts. Overall, global raw material volumes were stronger year over year. For fiscal 2015, the Company reported net sales of $3.40 billion, as compared with net sales of $3.96 billion for fiscal 2014.
Net income attributable to Darling for the three months ended January 2, 2016, was $84.4 million, or $0.52 per diluted share, compared to a net income of $69.9 million, or $0.42 per diluted share, for the three months ended January 3, 2015. Adjusted EBITDA for Darling for the three months ended January 2, 2016 was $102.7 million compared to Adjusted EBITDA of $108.7 million for the three months ended January 3, 2015. The $6.0 million decrease in Adjusted EBITDA is attributable to lower finished product prices in the USA and Canadian rendering businesses and the impact of foreign exchange rates as a function of the strengthening U.S. dollar as compared mainly to the euro and Canadian dollar.
The Company's ongoing capital allocation initiatives resulted in $42.4 million in debt reduction in the fourth quarter and $118.0 million for fiscal 2015. Darling continued its emphasis on organic growth in 2015 with the completion of two wet pet food plants, one bakery recycling plant and a major expansion at our Dubuque, Iowa gelatin plant. We expect these plants, plus two new rendering plants under construction scheduled for completion in the second half of 2016, to contribute meaningful revenue and earnings during 2016.
Comments on the Fourth Quarter and Fiscal 2015 Year End
Randall C. Stuewe, Darlings Ingredients Inc. Chairman and Chief Executive Officer, said of the Company's quarterly and fiscal year performance, "2015 was a year characterized by continued global commodity deflation. Our team delivered solid execution led by international businesses with growth and cost saving efficiencies achieved around the globe. While challenging conditions persisted through the fourth quarter, we delivered respectable quarterly results and exit 2015 a stronger company, highlighted by lower debt, strong cash flows and strategic investments in new plants and operating efficiencies."
"During the fourth quarter, our Food and Fuel segments performed well, generating strong EBITDA margins driven primarily by improved pricing and higher volumes, but were partially offset by continued FX challenges. In our Feed segment, we successfully navigated some short-term challenges that negatively impacted results, but pricing of these products rebounded nicely in early Q1 2016."
"While still early in 2016, our current view is that we will see improved conditions for fats and oils demand globally as we proceed into spring. We continue to be focused on areas that we can control across all levels of the organization. We believe that the significant cost savings we achieved in 2015 position us for success in 2016. Our focus continues to be on de-levering the balance sheet, while at the same time preserving the flexibility to continue to identify and execute growth opportunities that will position the Company for future success," concluded Mr. Stuewe.
Operational Update by Segment
Reconciliation of Fourth Quarter Net Income to Adjusted EBITDA (Non-GAAP) and Pro Forma Adjusted EBITDA
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). The Company believes that Adjusted EBITDA provides additional useful information to investors. As the Company uses the term, Adjusted EBITDA, is calculated below:
Three Months Ended - Year over Year | ||||
Adjusted EBITDA |
January 2, |
January 3, | ||
(U.S. dollars in thousands) |
2016 |
2015 | ||
Net income attributable to Darling |
$ 84,429 |
$ 69,943 | ||
Depreciation and amortization |
69,934 |
69,039 | ||
Interest expense |
23,308 |
24,633 | ||
Income tax expense/(benefit) |
(1,138) |
4,792 | ||
Foreign currency loss/(gain) |
1,612 |
1,267 | ||
Other expense/(income), net |
6,135 |
(271) | ||
Equity in net (income)/loss of unconsolidated subsidiaries |
(83,073) |
(59,547) | ||
Net (loss)/income attributable to noncontrolling interests |
1,446 |
(1,155) | ||
Adjusted EBITDA |
$102,653 |
$ 108,701 | ||
Acquisition and integration-related expenses |
492 |
2,363 | ||
Pro forma Adjusted EBITDA (Non-GAAP) |
$103,145 |
$ 111,064 | ||
Foreign currency exchange impact |
11,227 |
− | ||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP)(1) |
114,372 |
111,064 | ||
DGD Joint Venture Adjusted EBITDA (Darling's share) (2) |
$ 86,548 |
$ 63,757 | ||
(1) |
Foreign currency exchange rate held constant at euro/USD 1.093432 for the January 3, 2015 comparable quarter. | |||||
(2) |
Darling's Pro forma Adjusted EBITDA (Non-GAAP) in the above table does not include the DGD Joint Venture Adjusted EBITDA (Darling's share) if we had consolidated the DGD Joint Venture. |
For the three months ended January 2, 2016, the Company generated Adjusted EBITDA of $102.7 million, as compared to $108.7 million in the same period in fiscal 2014. The decrease was primarily due to lower finished product prices attributable to lower global competing ingredients prices and the impact of foreign exchange rates as a function of the strengthening U.S. dollar as compared mainly to the euro and Canadian dollar, which were partially offset by an increase in raw material volumes. As a result of the strengthened U.S. dollar, the above Pro forma Adjusted EBITDA results for the three months ended January 2, 2016 would have been $114.4 million when taking into consideration the change in average foreign exchange (FX) fluctuations of $11.2 million as compared to $111.1 million for the same period in fiscal 2014, an increase of $3.3 million.
Financial Update by Segment
Feed Ingredients |
Three Months Ended |
Fiscal Year Ended | ||||
($ thousands) |
January 2, 2016 |
January 3, 2015 |
January 2, 2016 |
January 3, 2015 | ||
Net Sales |
$ 472,192 |
$ 605,976 |
$ 2,074,333 |
$ 2,421,462 | ||
Segment operating income |
$ 10,031 |
$ 33,636 |
$ 116,453 |
$ 192,272 | ||
EBITDA |
$ 54,499 |
$ 76,362 |
$ 282,307 |
$ 351,143 |
Food Ingredients |
Three Months Ended |
Fiscal Year Ended | ||||
($ thousands) |
January 2, 2016 |
January 3, 2015 |
January 2, 2016 |
January 3, 2015 | ||
Net Sales |
$ 272,177 |
$ 322,048 |
$ 1,094,918 |
$ 1,248,352 | ||
Segment operating income |
$ 23,317 |
$ 13,657 |
$ 61,238 |
$ 26,874 | ||
EBITDA |
$ 39,008 |
$ 31,359 |
$ 128,055 |
$ 100,148 |
Fuel Ingredients |
Three Months Ended |
Fiscal Year Ended | ||||
($ thousands) |
January 2, 2016 |
January 3, 2015 |
January 2, 2016 |
January 3, 2015 | ||
Net Sales |
$ 65,306 |
$ 72,180 |
$ 228,195 |
$ 286,629 | ||
Segment operating income |
$ 12,382 |
$ 10,936 |
$ 17,159 |
$ 21,287 | ||
EBITDA |
$ 19,134 |
$ 16,858 |
$ 43,870 |
$ 49,185 |
Results of Operations – Fiscal Year Ended January 2, 2016 Compared to Fiscal Year Ended January 3, 2015
Net income attributable to Darling for the fiscal year ended January 2, 2016 was $78.5 million, or $0.48 per diluted share, as compared to net income of $64.2 million, or $0.39 per diluted share, for the fiscal year ended January 3, 2015. The results for the fiscal 2015 and 2014, respectively, include the following after-tax costs:
Fiscal 2015
Fiscal 2014
Excluding the items listed above, net income and diluted earnings per common share would have been $92.3 million, or $0.56 per diluted share, respectively, for the year ended January 2, 2016, as compared to $144.3 million, or $0.88 per diluted share, respectively, for the year ended January 3, 2015. When comparing the year ended January 2, 2016 to the year ended January 3, 2015 this would have resulted in a $52.0 million decrease in net income. The decrease is attributable to lower finished product prices and the impact of foreign exchange rates as a function of the strengthening U.S. dollar as compared mainly to the euro and Canadian dollar, which were partially offset by an increase in raw material volumes.
Reconciliation of Net Income to (Non-GAAP) Adjusted EBITDA and (Non-GAAP) Pro Forma Adjusted EBITDA – Year Ended
Fiscal Year Ended | ||||
Adjusted EBITDA |
January 2, |
January 3, | ||
(U.S. dollars in thousands) |
2016 |
2015 | ||
Net income attributable to Darling |
$ 78,531 |
$ 64,215 | ||
Depreciation and amortization |
269,904 |
269,517 | ||
Interest expense |
105,530 |
135,416 | ||
Income tax expense/(benefit) |
13,501 |
13,141 | ||
Foreign currency loss/(gain) |
4,911 |
13,548 | ||
Other expense/(income), net |
6,839 |
(299) | ||
Equity in net (income)/loss of unconsolidated subsidiaries |
(73,416) |
(65,609) | ||
Net (loss)/income attributable to noncontrolling interests |
6,748 |
4,096 | ||
Adjusted EBITDA (Non-GAAP) |
$ 412,548 |
$ 434,025 | ||
Non-cash inventory step-up associated with VION Acquisition |
− |
49,803 | ||
Acquisition and integration-related expenses |
8,299 |
24,667 | ||
Darling Ingredients International - 13th week (1) |
− |
4,100 | ||
Pro forma Adjusted EBITDA (Non-GAAP) |
$ 420,847 |
$ 512,595 | ||
Foreign currency exchange impact (2) |
48,961 |
− | ||
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) |
$ 469,808 |
$ 512,595 | ||
DGD Joint Venture Adjusted EBITDA (Darling's share) (3) |
$ 88,494 |
$ 81,639 | ||
(1) |
January 7, 2014 closed on VION Ingredients, thus the 13th week would be EBITDA adjusted for January 1, 2014 through January 7, 2014. | ||||||
(2) |
Foreign currency exchange rate held constant at euro/USD 1.31878 for comparable twelve months ended January 3, 2015. | ||||||
(3) |
Darling's Pro forma Adjusted EBITDA (Non-GAAP) in the above table does not include the DGD Joint Venture Adjusted EBITDA (Darling's share) if we had consolidated the DGD Joint Venture. |
For the year ended January 2, 2016, the Company generated Adjusted EBITDA of $412.5 million, as compared to $434.0 million in the same period in fiscal 2014. On a Pro forma Adjusted EBITDA basis, the Company would have generated $420.8 million for the year ended January 2, 2016, as compared to a Pro forma Adjusted EBITDA of $512.6 million in the same period in fiscal 2014. The decrease in the Pro forma Adjusted EBITDA is attributable to lower finished product prices and the impact of foreign exchange rates as a function of the strengthening U.S. dollar as compared mainly to the euro and Canadian dollar, which were partially offset by an increase in raw material volumes. As a result of the strengthened U.S. dollar, the above Pro forma Adjusted EBITDA results for the year ended January 2, 2016 would have been $469.8 million when taking into consideration the change in average foreign currency fluctuations of $49.0 million, as compared to $512.6 million for the year ended January 3, 2015, a reduction of $42.8 million.
About Darling
Darling Ingredients Inc. is the world's largest publicly-traded developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of ingredients and specialty products for customers in the pharmaceutical, food, pet food, feed, technical, fuel, bioenergy, and fertilizer industries. With operations on five continents, the Company collects and transforms all aspects of animal by-product streams into broadly used and specialty ingredients, such as gelatin, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstocks, green energy, natural casings and hides. The Company also recovers and converts used cooking oil and commercial bakery residuals into valuable feed and fuel ingredients. In addition, the Company provides grease trap services to food service establishments, environmental services to food processors and sells restaurant cooking oil delivery and collection equipment. For additional information, visit the Company's website at http://ir.darlingii.com.
Darling Ingredients Inc. will host a conference call to discuss the Company's fourth quarter and fiscal year 2015 financial results at 8:30 am Eastern Time (7:30 am Central Time) on Wednesday, March 2, 2016. To listen to the conference call, participants calling from within North America should dial 1-866-777-2509; international participants should dial 1-412-317-5413. Please refer to access code 10081094. 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 March 10, 2016 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 10081094. The conference call will also be archived on the Company's website.
Use of Non-GAAP Financial Measures:
Adjusted EBITDA is presented here not as an alternative to net income, but rather as a measure of the Company's operating performance and is not intended to be a presentation in accordance with GAAP. Since EBITDA (generally, net income plus interest expenses, 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.
As a result, the Company's management uses Adjusted EBITDA as a measure to evaluate performance and for other discretionary purposes. However, Adjusted EBITDA is not a recognized measurement under GAAP, should not be considered as an alternative to net income as a measure of operating results or to cash flow as a measure of liquidity, and is not intended to be a presentation in accordance with GAAP. 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 and 5.375% Notes and 4.75% Notes that were outstanding at January 2, 2016. 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 and 5.375% Notes and 4.75% Notes, as those definitions permit further adjustments to reflect certain other non-recurring costs and non-cash charges. Additionally, the Company evaluates the impact of foreign exchange on operating cash flow, which is defined as segment operating income (loss) plus depreciation and amortization.
In addition, the Company's management used adjusted diluted earnings per share as a measure of earnings due to the significant merger and acquisition activity of the Company. However, an adjusted earnings per share is not a recognized measurement under GAAP and should not be considered as an alternative to diluted earnings per share presented in accordance with GAAP. Adjusted diluted earnings per share is defined as adjusted net income attributable to Darling divided by the weighted average shares of diluted common stock. Adjusted net income attributable to Darling is defined as a reconciliation of net income attributable to Darling, net of tax (i) adjusted for net of tax acquisition and integration costs related to merger and acquisitions, (ii) net of tax amortization of acquisition related intangibles and (iii) net of tax certain non-recurring items that are not part of normal operations. This measure is solely for the purpose of calculating adjusted diluted earnings per share and is not intended to be a substitute of presentation in accordance with GAAP.
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," 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; unanticipated costs or operating problems related to the acquisition and integration of Rothsay and Darling Ingredients International (including transactional costs and integration of the new enterprise resource planning (ERP) system); 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, reduced demand for animal feed, or otherwise; reduced finished product prices; continued decline in fat and used cooking oil finished product prices; changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs like the Renewable Fuel Standards Program (RFS2) and tax credits for biofuels both in the Unites States and abroad; possible product recall resulting from developments relating to the discovery of unauthorized adulterations to food or food additives; the occurrence of Bird Flu including, but not limited to H5N1 flu, bovine spongiform encephalopathy (or "BSE"), porcine epidemic diarrhea ("PED") or other diseases associated with animal origin in the United States or elsewhere; 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 regulations (including, without limitation, China) affecting the industries in which the Company operates or its value added products (including new or modified animal feed, Bird Flu, PED or BSE or similar or unanticipated regulations); risks associated with the renewable diesel plant in Norco, Louisiana owned and operated by a joint venture between Darling Ingredients and Valero Energy Corporation, including possible unanticipated operating disruptions; 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; 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 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: |
|
Melissa A. Gaither, V.P. Investor Relations and Global Communications |
Email: mgaither@darlingii.com |
251 O'Connor Ridge Blvd., Suite 300 |
Phone: 972-717-0300 |
Irving, Texas 75038 |
Darling Ingredients Inc. and Subsidiaries Condensed Consolidated Balance Sheets January 2, 2016 and January 3, 2015 (Dollars in thousands, except share data) | ||||
January 2, |
January 3, | |||
2016 |
2015 | |||
ASSETS |
||||
Current assets: |
||||
Cash and cash equivalents |
$ 156,884 |
$ 108,784 | ||
Restricted cash |
331 |
343 | ||
Accounts receivable, net |
371,392 |
409,779 | ||
Inventories |
344,583 |
401,613 | ||
Prepaid expenses |
36,175 |
44,629 | ||
Income taxes refundable |
11,963 |
22,140 | ||
Other current assets |
10,460 |
21,324 | ||
Total current assets |
931,788 |
1,008,612 | ||
Property, plant and equipment, less accumulated depreciation, net |
1,508,167 |
1,574,116 | ||
Intangible assets, less accumulated amortization, net |
782,349 |
932,413 | ||
Goodwill |
1,233,102 |
1,320,419 | ||
Investment in unconsolidated subsidiaries |
247,238 |
202,712 | ||
Other assets |
70,606 |
71,009 | ||
Deferred income taxes |
16,352 |
17,266 | ||
Total assets |
$ 4,789,602 |
$ 5,126,547 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||
Current liabilities: |
||||
Current portion of long-term debt |
$ 47,244 |
$ 54,401 | ||
Accounts payable, principally trade |
149,998 |
168,518 | ||
Income taxes payable |
6,679 |
4,363 | ||
Accrued expenses |
239,825 |
256,119 | ||
Total current liabilities |
443,746 |
483,401 | ||
Long-term debt, net of current portion |
1,912,756 |
2,098,039 | ||
Other noncurrent liabilities |
97,809 |
114,700 | ||
Deferred income taxes |
360,681 |
379,273 | ||
Total liabilities |
2,814,992 |
3,075,413 | ||
Commitments and contingencies |
||||
Total Darling's stockholders' equity |
1,870,709 |
1,952,990 | ||
Noncontrolling interests |
103,901 |
98,144 | ||
Total stockholders' equity |
$ 1,974,610 |
$ 2,051,134 | ||
$ 4,789,602 |
$ 5,126,547 |
Darling Ingredients Inc. and Subsidiaries Consolidated Statements of Operations For the Periods Ended January 2, 2016 and January 3, 2015 (Dollars in thousands, except per share data) | ||||||||||||
(Fourth Quarter Unaudited) |
||||||||||||
Three Months Ended |
Fiscal Year Ended | |||||||||||
January 2, |
January 3, |
$ Change |
January 2, |
January 3, |
$ Change | |||||||
2016 |
2015 |
(Unfavorable) |
2016 |
2015 |
(Unfavorable) | |||||||
Net sales |
$809,675 |
$1,000,203 |
$ (190,528) |
$3,397,446 |
$3,956,443 |
$ (558,997) | ||||||
Costs and expenses: |
||||||||||||
Cost of sales and operating expenses |
$629,907 |
$ 794,299 |
164,392 |
$2,654,025 |
$3,123,171 |
469,146 | ||||||
Selling, general and administrative expenses |
76,623 |
94,840 |
18,217 |
322,574 |
374,580 |
52,006 | ||||||
Depreciation and amortization |
69,934 |
69,039 |
(895) |
269,904 |
269,517 |
(387) | ||||||
Acquisition and Integration costs |
492 |
2,363 |
1,871 |
8,299 |
24,667 |
16,368 | ||||||
Total costs and expenses |
776,956 |
960,541 |
183,585 |
3,254,802 |
3,791,935 |
537,133 | ||||||
Operating income |
32,719 |
39,662 |
(6,943) |
142,644 |
164,508 |
(21,864) | ||||||
Other expense: |
||||||||||||
Interest expense |
(23,308) |
(24,633) |
1,325 |
(105,530) |
(135,416) |
29,886 | ||||||
Foreign currency gain/(loss) |
(1,612) |
(1,267) |
(345) |
(4,911) |
(13,548) |
8,637 | ||||||
Other income/(expense), net |
(6,135) |
271 |
(6,406) |
(6,839) |
299 |
(7,138) | ||||||
Total other expense |
(31,055) |
(25,629) |
(5,426) |
(117,280) |
(148,665) |
31,385 | ||||||
Equity in net income of unconsolidated subsidiaries |
83,073 |
59,547 |
23,526 |
73,416 |
65,609 |
7,807 | ||||||
Income from operations before income taxes |
84,737 |
73,580 |
11,157 |
98,780 |
81,452 |
17,328 | ||||||
Income tax expense/(benefit) |
(1,138) |
4,792 |
5,930 |
13,501 |
13,141 |
(360) | ||||||
Net income |
$ 85,875 |
$ 68,788 |
$ 17,087 |
$ 85,279 |
$ 68,311 |
$ 16,968 | ||||||
Net (income)/loss attributable to noncontrolling interests |
$ (1,446) |
$ 1,155 |
$ (2,601) |
$ (6,748) |
$ (4,096) |
$ (2,652) | ||||||
Net income attributable to Darling |
$ 84,429 |
$ 69,943 |
$ 14,486 |
$ 78,531 |
$ 64,215 |
$ 14,316 | ||||||
Basic income/(loss) per share: |
$ 0.52 |
$ 0.42 |
$ 0.10 |
$ 0.48 |
$ 0.39 |
$ 0.09 | ||||||
Diluted income/(loss) per share: |
$ 0.52 |
$ 0.42 |
$ 0.10 |
$ 0.48 |
$ 0.39 |
$ 0.09 |
Darling Ingredients Inc. and Subsidiaries Consolidated Statement of Cash Flows Fiscal Year Ended January 2, 2016 and January 3, 2015 (Dollars in thousands) | ||||||
Fiscal Year Ended | ||||||
January 2, |
January 3, | |||||
Cash flows from operating activities: |
2016 |
2015 | ||||
Net income |
$ 85,279 |
$ 68,311 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||
Depreciation and amortization |
269,904 |
269,517 | ||||
Deferred taxes |
7,807 |
(21,216) | ||||
Loss/(gain) on sale of assets |
1,311 |
(2,437) | ||||
Gain on insurance proceeds from insurance settlements |
(561) |
(1,550) | ||||
Increase/(decrease) in long-term pension liability |
(4,811) |
9,593 | ||||
Stock-based compensation expense |
8,995 |
20,807 | ||||
Write-off deferred loan costs |
10,633 |
4,330 | ||||
Deferred loan cost amortization |
10,155 |
9,949 | ||||
Equity in net income of unconsolidated subsidiaries |
(73,416) |
(65,609) | ||||
Distributions of earnings from unconsolidated subsidiaries |
26,589 |
− | ||||
Changes in operating assets and liabilities, net of effects from acquisitions: |
||||||
Accounts receivable |
8,214 |
982 | ||||
Income taxes refundable/payable |
12,377 |
(22,451) | ||||
Inventories and prepaid expenses |
34,536 |
(11,194) | ||||
Accounts payable and accrued expenses |
(11,449) |
(31,223) | ||||
Other |
35,785 |
47,363 | ||||
Net cash provided by operating activities |
421,348 |
275,172 | ||||
Cash flows from investing activities: |
||||||
Capital expenditures |
(229,848) |
(228,918) | ||||
Acquisitions, net of cash acquired |
(377) |
(2,094,400) | ||||
Gross proceeds from sale of property, plant and equipment and other assets |
3,840 |
9,262 | ||||
Proceeds from insurance settlement |
561 |
1,550 | ||||
Payments related to routes and other intangibles |
(3,845) |
(11,288) | ||||
Net cash used by investing activities |
(229,669) |
(2,323,794) | ||||
Cash flows from financing activities: |
||||||
Proceeds from long-term debt |
590,745 |
1,842,184 | ||||
Payments on long-term debt |
(609,255) |
(333,762) | ||||
Borrowings from revolving credit facility |
78,244 |
170,143 | ||||
Payments on revolving credit facility |
(166,755) |
(351,589) | ||||
Net cash overdraft financing |
(1,261) |
4,077 | ||||
Deferred loan costs |
(17,310) |
(45,223) | ||||
Issuance of commons stock |
171 |
416 | ||||
Repurchase of common stock |
(5,912) |
− | ||||
Minimum withholding taxes paid on stock awards |
(4,874) |
(10,026) | ||||
Excess tax benefits/(expense) from stock-based compensation |
(389) |
2,420 | ||||
Addition/(deductions) of noncontrolling interest |
(87) |
1,201 | ||||
Distributions to noncontrolling interests |
(3,295) |
(4,272) | ||||
Net cash provided/(used) in financing activities |
(139,978) |
1,275,569 | ||||
Effect of exchange rate changes on cash flows |
(3,601) |
10,980 | ||||
Net increase/(decrease) in cash and cash equivalents |
48,100 |
(762,073) | ||||
Cash and cash equivalents at beginning of period |
108,784 |
870,857 | ||||
Cash and cash equivalents at end of period |
$ 156,884 |
$ 108,784 | ||||
Supplemental disclosure of cash flow information: |
||||||
Accrued capital expenditures |
$ 5,325 |
$ 1,340 | ||||
Cash paid during the period for: |
||||||
Interest, net of capitalized interest |
$ 78,979 |
$ 104,834 | ||||
Income taxes, net of refunds |
$ (3,035) |
$ 28,315 | ||||
Non-cash financing activities |
||||||
Debt issued for service contract assets |
$ 2,591 |
$ - | ||||
Darling Ingredients Inc. Adjusted (Non-GAAP) Diluted Earnings per Share Fiscal Year Ended January 2, 2016 and January 3, 2015 | ||||
Fiscal Year Ended | ||||
January 2, |
January 3, | |||
2016 |
2015 | |||
Weighted average shares of common stock outstanding (in thousands) |
165,119 |
165,059 | ||
Reported Earnings Per Share (fully diluted) |
$ 0.48 |
$ 0.39 | ||
Non-cash inventory step-up associated with the VION Acquisition |
- |
0.19 | ||
Acquisition and integration costs |
0.03 |
0.13 | ||
Amortization of intangibles |
0.29 |
0.32 | ||
Non-operating casualty losses and legal settlement |
0.02 |
- | ||
Redemption premium on 8.5% Senior Notes and write off deferred loan costs |
- |
0.12 | ||
Write-off deferred loan costs euro term loan B |
0.03 |
- | ||
Foreign currency hedge of VION purchase price |
- |
0.05 | ||
Adjusted diluted earnings per share attributable to Darling (Non-GAAP) (1) |
$ 0.85 |
$ 1.20 |
(1) |
Adjustments to diluted earnings per share of acquisition related items are net of tax. Calculations of all adjustment tax amounts were at the applicable effective tax rate for the period, except for the impact of the biofuel tax incentives and nonrecurring acquisition and integration costs. The effective tax rate used for calculating Non-GAAP Adjusted EPS in the above table for the year ended January 2, 2016 and January 3, 2015 was 42.2% and 37.1%, respectively. |
SOURCE Darling Ingredients Inc.
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