Business Segments

9 Months Ended

Sep. 27, 2014

Segment Reporting [Abstract]

Business Segments

Business Segments

Effective December 29, 2013, the Company's business operations were reorganized into three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients, in order to better align its business with the underlying markets and customers that the Company serves. All historical periods have been recast for the changes to the segment reporting structure. The Company sells its products domestically and internationally. The measure of segment profit (loss) includes all revenues, operating expenses (excluding certain amortization of intangibles), and selling, general and administrative expenses incurred at all operating locations and excludes general corporate expenses.

Included in corporate activities are general corporate expenses and the amortization of certain intangibles. Assets of corporate activities include cash, unallocated prepaid expenses, deferred tax assets, prepaid pension, and miscellaneous other assets.

Feed Ingredients

Feed Ingredients consists principally of (i) the Company's U.S. ingredients business, including the Company's used cooking oil, trap grease and food residuals collection businesses, the Rothsay ingredients business, and the ingredients and specialty products businesses conducted by Darling Ingredients International under the Sonac name (proteins, fats, and plasma products) and (ii) the Company's bakery residuals business. Feed Ingredients operations process animal by-products and used cooking oil into fats, protein and hides.

Food Ingredients

Food Ingredients consists principally of (i) the gelatin and collagen hydrolysates business conducted by Darling Ingredients International under the Rousselot name, (ii) the natural casings and meat-by-products business conducted by Darling Ingredients International under the CTH name and (iii) certain specialty products businesses conducted by Darling Ingredients International under the Sonac name.

Fuel Ingredients

The Company's Fuel Ingredients segment consists of (i) the Company's biofuel business conducted under the Dar Pro® and Rothsay names (ii) the bioenergy business conducted by Darling Ingredients International under the Ecoson and Rendac names and (iii) the Company's investment in the DGD Joint Venture.

Business Segments (in thousands):

	Feed Ingredients		Food Ingredients		Fuel Ingredients			Corporate			Total
Three Months Ended September 27, 2014
Net Sales	$	583,408	$	301,398	$	70,994		$	—		$	955,800
Cost of sales and operating expenses	446,495		226,604		52,041			30			725,170
Gross Margin	136,913		74,794		18,953			(30		)	230,630
Selling, general and administrative expense	52,943		42,244		7,259			8,757			111,203
Acquisition costs	—		—		—			2,191			2,191
Depreciation and amortization	37,720		18,503		8,780			2,308			67,311
Segment operating income/ (loss)	46,250		14,047		2,914			(13,286		)	49,925
Equity in net income of unconsolidated subsidiaries	426		—		(1,481		)	—			(1,055		)
Segment income	46,676		14,047		1,433			(13,286		)	48,870
Total other expense											(21,780		)
Income before income taxes											$	27,090

	Feed Ingredients		Food Ingredients		Fuel Ingredients		Corporate			Total
Three Months Ended September 28, 2013
Net Sales	$	423,661	$	—	$	2,125	$	—		$	425,786
Cost of sales and operating expenses	308,326		—		1,672		91			310,089
Gross Margin	115,335		—		453		(91		)	115,697
Selling, general and administrative expense	35,178		—		60		7,350			42,588
Acquisition costs	—		—		—		8,326			8,326
Depreciation and amortization	21,324		—		34		1,773			23,131
Segment operating income/ (loss)	58,833		—		359		(17,540		)	41,652
Equity in net income of unconsolidated subsidiaries	—		—		11,953		—			11,953
Segment income	58,833		—		12,312		(17,540		)	53,605
Total other expense										(8,581		)
Income before income taxes										$	45,024

	Feed Ingredients		Food Ingredients		Fuel Ingredients		Corporate			Total
Nine Months Ended September 27, 2014
Net Sales	$	1,753,095	$	926,222	$	214,877	$	—		$	2,894,194
Cost of sales and operating expenses	1,315,692		738,752		163,671		—			2,218,115
Gross Margin	437,403		187,470		51,206		—			676,079
Selling, general and administrative expense	163,110		118,681		18,392		28,268			328,451
Acquisition costs	—		—		—		22,304			22,304
Depreciation and amortization	116,145		55,572		21,976		6,785			200,478
Segment operating income/ (loss)	158,148		13,217		10,838		(57,357		)	124,846
Equity in net income of unconsolidated subsidiaries	1,390		—		4,672		—			6,062
Segment income	159,538		13,217		15,510		(57,357		)	130,908
Total other expense										(123,036		)
Income/ (loss) before income taxes										$	7,872
Segment assets at September 27, 2014	$	2,754,492	$	1,798,152	$	661,417	$	163,795		$	5,377,856

	Feed Ingredients		Food Ingredients		Fuel Ingredients		Corporate			Total
Nine Months Ended September 28, 2013
Net Sales	$	1,288,809	$	—	$	5,992	$	—		$	1,294,801
Cost of sales and operating expenses	937,985		—		4,712		—			942,697
Gross Margin	350,824		—		1,280		—			352,104
Selling, general and administrative expense	102,372		—		251		22,220			124,843
Acquisition costs	—		—		—		9,157			9,157
Depreciation and amortization	63,497		—		96		3,481			67,074
Segment operating income/ (loss)	184,955		—		933		(34,858		)	151,030
Equity in net income of unconsolidated subsidiaries	—		—		8,796		—			8,796
Segment income	184,955		—		9,729		(34,858		)	159,826
Total other expense										(19,226		)
Income before income taxes										$	140,600
Segment assets at December 28, 2013	$	1,986,564	$	—	$	179,722	$	1,077,847		$	3,244,133