Guarantor Financial Information (Tables)

3 Months Ended

Mar. 30, 2019

Guarantor Financial Information [Abstract]

Guarantor Financial Information Condensed Consolidating Balance Sheet

Condensed Consolidated Balance Sheet

As of March 30, 2019

(in thousands)

	Parent		Guarantors			Non-guarantors		Eliminations			Consolidated
ASSETS
Cash and cash equivalents	$	987	$	33		$	94,696	$	—		$	95,716
Restricted cash	103		—			4		—			107
Accounts receivable	43,885		640,838			468,164		(781,548		)	371,339
Inventories	19,211		85,113			235,558		—			339,882
Income taxes refundable	1,426		—			2,676		—			4,102
Prepaid expenses	12,155		2,508			24,407		—			39,070
Other current assets	3,355		(1,980		)	19,584		—			20,959
Total current assets	81,122		726,512			845,089		(781,548		)	871,175
Investment in subsidiaries	4,934,820		1,366,126			844,044		(7,144,990		)	—
Property, plant and equipment, net	392,718		503,739			795,101		—			1,691,558
Intangible assets, net	48,619		193,338			337,356		—			579,313
Goodwill	49,902		490,748			681,732		—			1,222,382
Investment in unconsolidated subsidiaries	13,078		—			420,303		—			433,381
Operating lease right-of-use asset	75,150		34,974			19,597		—			129,721
Other assets	38,490		140			14,857		—			53,487
Deferred taxes	—		—			14,037		—			14,037
	$	5,633,899	$	3,315,577		$	3,972,116	$	(7,926,538	)	$	4,995,054
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current portion of long-term debt	$	11,908	$	5		$	11,780	$	—		$	23,693
Accounts payable	807,675		27,833			138,539		(781,536		)	192,511
Income taxes payable	300		—			8,561		—			8,861
Current operating lease liability	21,546		10,673			7,557		—			39,776
Accrued expenses	85,734		27,109			168,500		(12		)	281,331
Total current liabilities	927,163		65,620			334,937		(781,548		)	546,172
Long-term debt, net of current portion	1,032,803		16			630,944		—			1,663,763
Long-term operating lease liability	53,587		23,701			11,812		—			89,100
Other noncurrent liabilities	78,220		—			35,764		—			113,984
Deferred income taxes	95,191		—			130,145		—			225,336
Total liabilities	2,186,964		89,337			1,143,602		(781,548		)	2,638,355
Total stockholders’ equity	3,446,935		3,226,240			2,828,514		(7,144,990		)	2,356,699
	$	5,633,899	$	3,315,577		$	3,972,116	$	(7,926,538	)	$	4,995,054

Condensed Consolidated Balance Sheet

As of December 29, 2018

(in thousands)

	Parent			Guarantors			Non-guarantors		Eliminations			Consolidated
ASSETS
Cash and cash equivalents	$	995		$	32		$	106,235	$	—		$	107,262
Restricted cash	103			—			4		—			107
Accounts receivable	56,113			619,628			461,005		(751,009		)	385,737
Inventories	23,752			83,261			234,015		—			341,028
Income taxes refundable	2,851			—			3,611		—			6,462
Prepaid expenses	12,890			2,936			19,421		—			35,247
Other current assets	2,680			(1,418		)	20,837		—			22,099
Total current assets	99,384			704,439			845,128		(751,009		)	897,942
Investment in subsidiaries	4,880,193			1,366,126			844,044		(7,090,363		)	—
Property, plant and equipment, net	375,824			503,130			808,904		—			1,687,858
Intangible assets, net	50,132			200,936			344,794		—			595,862
Goodwill	49,506			490,748			688,905		—			1,229,159
Investment in unconsolidated subsidiary	13,969			—			396,208		—			410,177
Other assets	39,395			138			13,842		—			53,375
Deferred income taxes	—			—			14,981		—			14,981
	$	5,508,403		$	3,265,517		$	3,956,806	$	(7,841,372	)	$	4,889,354
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current portion of long-term debt	$	3,558		$	5		$	3,929	$	—		$	7,492
Accounts payable	783,406			24,388			162,678		(750,993		)	219,479
Income taxes payable	(10		)	—			4,053		—			4,043
Accrued expenses	107,572			33,387			168,541		(16		)	309,484
Total current liabilities	894,526			57,780			339,201		(751,009		)	540,498
Long-term debt, net of current portion	1,019,130			18			647,792		—			1,666,940
Other noncurrent liabilities	78,589			—			36,443		—			115,032
Deferred income taxes	95,710			—			135,353		—			231,063
Total liabilities	2,087,955			57,798			1,158,789		(751,009		)	2,553,533
Total stockholders’ equity	3,420,448			3,207,719			2,798,017		(7,090,363		)	2,335,821
	$	5,508,403		$	3,265,517		$	3,956,806	$	(7,841,372	)	$	4,889,354

Guarantor Financial Information Condensed Consolidating Statements Of Operations

Condensed Consolidated Statements of Operations

For the three months ended March 30, 2019

(in thousands)

	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	160,230		$	329,991		$	403,911		$	(59,028	)	$	835,104
Cost and expenses:
Cost of sales and operating expenses	128,392			267,194			310,105			(59,028		)	646,663
Selling, general and administrative expenses	47,423			11,947			25,633			—			85,003
Depreciation and amortization	14,373			26,112			38,679			—			79,164
Total costs and expenses	190,188			305,253			374,417			(59,028		)	810,830
Operating income/(loss)	(29,958		)	24,738			29,494			—			24,274
Interest expense	(14,027		)	(32		)	(5,817		)	—			(19,876		)
Foreign currency losses	(4		)	—			(728		)	—			(732		)
Gain on disposal of subsidiary	—			—			—			—			—
Other expense, net	(1,567		)	(1,212		)	254			—			(2,525		)
Equity in net loss of unconsolidated subsidiaries	(891		)	—			24,664			—			23,773
Earnings in investments in subsidiaries	54,627			—			—			(54,627		)	—
Income/(loss) before taxes	8,180			23,494			47,867			(54,627		)	24,914
Income tax expense/(benefit)	(9,832		)	4,973			10,133			—			5,274
Net income attributable to noncontrolling interests	—			—			(1,628		)	—			(1,628		)
Net income/(loss) attributable to Darling	$	18,012		$	18,521		$	36,106		$	(54,627	)	$	18,012

Condensed Consolidated Statements of Operations

For the three months ended March 31, 2018

(in thousands)

	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
Net sales	$	119,625		$	344,603		$	467,808		$	(56,662	)	$	875,374
Cost and expenses:
Cost of sales and operating expenses	95,868			271,237			367,656			(56,662		)	678,099
Selling, general and administrative expenses	43,778			12,837			30,287			—			86,902
Depreciation and amortization	11,059			26,291			41,269			—			78,619
Total costs and expenses	150,705			310,365			439,212			(56,662		)	843,620
Operating income/(loss)	(31,080		)	34,238			28,596			—			31,754
Interest expense	(14,364		)	3,763			(12,523		)	—			(23,124		)
Foreign currency gains/(losses)	(23		)	(63		)	(1,395		)	—			(1,481		)
Other income/(expense), net	(3,410		)	(1,326		)	2,220			—			(2,516		)
Equity in net income/(loss) of unconsolidated subsidiaries	(498		)	—			97,652			—			97,154
Earnings in investments in subsidiaries	144,880			—			—			(144,880		)	—
Income/(loss) before taxes	95,505			36,612			114,550			(144,880		)	101,787
Income tax expense/(benefit)	(1,800		)	1,335			4,177			—			3,712
Net income attributable to noncontrolling interests	—			—			(770		)	—			(770		)
Net income/(loss) attributable to Darling	$	97,305		$	35,277		$	109,603		$	(144,880	)	$	97,305

Guarantor Financial Information Condensed Consolidating Statements of Comprehensive Income/(Loss)

Condensed Consolidated Statements of Comprehensive Income/(Loss)

For the three months ended March 30, 2019

(in thousands)

	Parent		Guarantors		Non-guarantors			Eliminations			Consolidated
Net income/(loss)	$	19,640	$	18,521	$	36,106		$	(54,627	)	$	19,640
Other comprehensive income/(loss), net of tax:
Foreign currency translation	507		—		(5,393		)	—			(4,886		)
Pension adjustments	767		—		91			—			858
Foreign exchange derivative adjustments	—		—		(1,937		)	—			(1,937		)
Total other comprehensive income/(loss), net of tax	1,274		—		(7,239		)	—			(5,965		)
Total comprehensive income/(loss)	20,914		18,521		28,867			(54,627		)	13,675
Total comprehensive loss attributable to noncontrolling interest	—		—		3,387			—			3,387
Total comprehensive income/(loss) attributable to Darling	$	20,914	$	18,521	$	25,480		$	(54,627	)	$	10,288

Condensed Consolidated Statements of Comprehensive Income/(Loss)

For the three months ended March 31, 2018

(in thousands)

	Parent			Guarantors		Non-guarantors		Eliminations			Consolidated
Net income/(loss)	$	98,075		$	35,277	$	109,603	$	(144,880	)	$	98,075
Other comprehensive income/(loss), net of tax:
Foreign currency translation	—			—		17,295		—			17,295
Pension adjustments	566			—		101		—			667
Natural gas swap derivative adjustments	22			—		—		—			22
Corn option derivative adjustments	(1,605		)	—		—		—			(1,605		)
Total other comprehensive income/(loss), net of tax	(1,017		)	—		17,396		—			16,379
Total comprehensive income/(loss)	97,058			35,277		126,999		(144,880		)	114,454
Total comprehensive income attributable to noncontrolling interest	—			—		1,287		—			1,287
Total comprehensive income/(loss) attributable to Darling	$	97,058		$	35,277	$	125,712	$	(144,880	)	$	113,167

Guarantor Financial Information Condensed Consolidating Statements Of Cash Flows

Condensed Consolidated Statements of Cash Flows

For the three months ended March 30, 2019

(in thousands)

	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income/(loss)	$	19,640		$	18,521		$	36,106		$	(54,627	)	$	19,640
Earnings in investments in subsidiaries	(54,627		)	—			—			54,627			—
Other operating cash flows	52,135			(2,881		)	(20,293		)	—			28,961
Net cash provided by operating activities	17,148			15,640			15,813			—			48,601
Cash flows from investing activities:
Capital expenditures	(34,303		)	(23,498		)	(26,468		)	—			(84,269		)
Acquisitions	(1,157		)	—			(274		)	—			(1,431		)
Gross proceeds from sale of property, plant and equipment and other assets	132			7,016			720			—			7,868
Proceeds from insurance settlements	—			845			—			—			845
Payments related to routes and other intangibles	—			—			(2,778		)	—			(2,778		)
Net cash used in investing activities	(35,328		)	(15,637		)	(28,800		)	—			(79,765		)
Cash flows from financing activities:
Proceeds for long-term debt	—			—			2,138			—			2,138
Payments on long-term debt	—			(2		)	(10,972		)	—			(10,974		)
Borrowings from revolving facilities	50,000			—			106,829			—			156,829
Payments on revolving facilities	(37,000		)	—			(101,147		)	—			(138,147		)
Net cash overdraft financing	8,350			—			6,175			—			14,525
Issuances of common stock	12			—			—			—			12
Minimum withholding taxes paid on stock awards	(3,190		)	—			—			—			(3,190		)
Net cash provided/(used) in financing activities	18,172			(2		)	3,023			—			21,193
Effect of exchange rate changes on cash	—			—			(1,575		)	—			(1,575		)
Net decrease in cash, cash equivalents and restricted cash	(8		)	1			(11,539		)	—			(11,546		)
Cash, cash equivalents and restricted cash at beginning of period	1,098			32			106,239			—			107,369
Cash, cash equivalents and restricted cash at end of period	$	1,090		$	33		$	94,700		$	—		$	95,823

Condensed Consolidated Statements of Cash Flows

For the three months ended March 31, 2018

(in thousands)

	Parent			Guarantors			Non-guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income/(loss)	$	98,075		$	35,277		$	109,603		$	(144,880	)	$	98,075
Earnings in investments in subsidiaries	(144,880		)	—			—			144,880			—
Other operating cash flows	30,782			(24,262		)	(77,671		)	—			(71,151		)
Net cash provided/(used) by operating activities	(16,023		)	11,015			31,932			—			26,924
Cash flows from investing activities:
Capital expenditures	(12,183		)	(13,396		)	(31,008		)	—			(56,587		)
Investment in subsidiaries and affiliates	(3,500		)	—			—			—			(3,500		)
Proceeds from sale of investment in subsidiary	—			—			2,805			—			2,805
Gross proceeds from sale of property, plant and equipment and other assets	828			321			330			—			1,479
Proceeds from insurance settlements	—			503			—			—			503
Payments related to routes and other intangibles	—			—			(15		)	—			(15		)
Net cash used in investing activities	(14,855		)	(12,572		)	(27,888		)	—			(55,315		)
Cash flows from financing activities:
Proceeds for long-term debt	—			—			3,876			—			3,876
Payments on long-term debt	(22		)	—			(9,600		)	—			(9,622		)
Borrowings from revolving credit facility	62,000			—			73,184			—			135,184
Payments on revolving credit facility	(29,000		)	—			(51,019		)	—			(80,019		)
Net cash overdraft financing	—			—			(331		)	—			(331		)
Deferred loan costs	(1,094		)	—			—			—			(1,094		)
Issuances of common stock	182			—			—			—			182
Minimum withholding taxes paid on stock awards	(2,013		)	—			(5		)	—			(2,018		)
Net cash provided by financing activities	30,053			—			16,105			—			46,158
Effect of exchange rate changes on cash	—			—			(1,672		)	—			(1,672		)
Net decrease in cash, cash equivalents and restricted cash	(825		)	(1,557		)	18,477			—			16,095
Cash, cash equivalents and restricted cash at beginning of period	1,827			2,993			102,096			—			106,916
Cash, cash equivalents and restricted cash at end of period	$	1,002		$	1,436		$	120,573		$	—		$	123,011