Comprehensive Income

12 Months Ended

Jan. 01, 2022

COMPREHENSIVE INCOME/(LOSS)

The Company follows Financial Accounting Standards Board (“FASB”) authoritative guidance for reporting and presentation of comprehensive income or loss and its components. Other comprehensive income (loss) is derived from adjustments that reflect pension adjustments, natural gas swap adjustments, corn option adjustments, soybean meal forward adjustments, foreign exchange forward and option adjustments, heating oil swap adjustments and foreign currency translation adjustments.

In fiscal 2021, fiscal 2020 and fiscal 2019, the Company's DGD Joint Venture entered into heating oil derivatives that were deemed to be cash flow hedges. As a result, the Company has accrued the other comprehensive income/(loss) portion belonging to Darling with an offset to the investment in DGD as required by FASB ASC Topic 323.

The components of other comprehensive income/(loss) and the related tax impacts for the years ended January 1, 2022, January 2, 2021 and December 28, 2019 are as follows (in thousands):


	Before-Tax		Tax (Expense)		Net-of-Tax
	Amount		or Benefit		Amount
Year Ended December 28, 2019
Defined Benefit Pension Plans
Actuarial (loss)/gain recognized	$	(2,202)	$	211	$	(1,991)
Amortization of actuarial gain/(loss)	4,571		(1,143)		3,428
Actuarial prior service cost recognized	9		(2)		7
Amortization of prior service costs	34		(9)		25

Amortization of settlement	66		(16)		50
Other	16		—		16
Total defined benefit pension plans	2,494		(959)		1,535








Heating oil swap derivatives
Activity recognized in other comprehensive income (loss)	(4,188)		1,047		(3,141)
Total heating oil derivatives	(4,188)		1,047		(3,141)
Corn option derivatives
Reclassified to earnings	422		(106)		316
Activity recognized in other comprehensive income (loss)	(51)		13		(38)
Total corn options	371		(93)		278
Foreign exchange derivatives
Reclassified to earnings	1,345		(442)		903
Activity recognized in other comprehensive income (loss)	(6,887)		2,261		(4,626)
Total foreign exchange derivatives	(5,542)		1,819		(3,723)

Foreign currency translation	(12,771)		837		(11,934)
Other comprehensive income/(loss)	$	(19,636)	$	2,651	$	(16,985)
Year Ended January 2, 2021
Defined Benefit Pension Plans
Actuarial (loss)/gain recognized	$	(9,470)	$	2,547	$	(6,923)


Amortization of actuarial gain/(loss)	3,405		(862)		2,543

Amortization of prior service costs	33		(8)		25
Amortization of curtailment	69		(15)		54
Amortization of settlement	(30)		7		(23)
Other	11		—		11
Total defined benefit pension plans	(5,982)		1,669		(4,313)




Soybean meal option derivatives
Reclassified to earnings	49		(12)		37
Activity recognized in other comprehensive income (loss)	349		(89)		260
Total soybean meal derivatives	398		(101)		297
Heating oil swap derivatives
Activity recognized in other comprehensive income (loss)	1,457		(353)		1,104
Total heating oil derivatives	1,457		(353)		1,104
Corn option derivatives
Reclassified to earnings	123		(31)		92
Activity recognized in other comprehensive income (loss)	(7,803)		1,980		(5,823)
Total corn options	(7,680)		1,949		(5,731)
Foreign exchange derivatives
Reclassified to earnings	(13,809)		5,114		(8,695)
Activity recognized in other comprehensive income (loss)	24,325		(9,009)		15,316
Total foreign exchange derivatives	10,516		(3,895)		6,621
Foreign currency translation	73,845		(3,525)		70,320
Other comprehensive income/(loss)	$	72,554	$	(4,256)	$	68,298
Year Ended January 1, 2022
Defined Benefit Pension Plans
Actuarial gain/(loss) recognized	$	12,415	$	(3,185)	$	9,230
Amortization of actuarial gain/(loss)	4,228		(978)		3,250

Amortization of prior service costs	25		(3)		22

Amortization of settlement	210		(27)		183
Other	(16)		—		(16)
Total defined benefit pension plans	16,862		(4,193)		12,669
Soybean meal option derivatives
Reclassified to earnings	(274)		70		(204)
Activity recognized in other comprehensive income (loss)	85		(22)		63
Total soybean meal derivatives	(189)		48		(141)
Heating oil swap derivatives

Activity recognized in other comprehensive income (loss)	1,199		(305)		894
Total heating oil derivatives	1,199		(305)		894
Corn option derivatives
Reclassified to earnings	17,005		(4,319)		12,686
Activity recognized in other comprehensive income (loss)	(14,541)		3,693		(10,848)
Total corn options	2,464		(626)		1,838
Foreign exchange derivatives
Reclassified to earnings	(2,333)		826		(1,507)
Activity recognized in other comprehensive income (loss)	(6,694)		2,368		(4,326)
Total foreign exchange derivatives	(9,027)		3,194		(5,833)
Foreign currency translation	(77,287)		3,068		(74,219)
Other comprehensive income/(loss)	$	(65,978)	$	1,186	$	(64,792)


	Fiscal Year Ended
	January 1, 2022		January 2, 2021		December 28, 2019		Statement of Operations Classification
Derivative instruments
Soybean meal option derivatives	$	274	$	(49)	$	—	Net sales
Foreign Exchange derivatives	2,333		13,809		(1,345)		Net sales

Corn option derivatives	(17,005)		(123)		(422)		Cost of sales and operating expenses

	(14,398)		13,637		(1,767)		Total before tax
	3,423		(5,071)		548		Income taxes
	(10,975)		8,566		(1,219)		Net of tax
Defined benefit pension plans
Amortization of prior service cost	$	(25)	$	(33)	$	(34)	(a)
Amortization of actuarial loss	(4,228)		(3,405)		(4,571)		(a)
Amortization of curtailment	—		(69)		—		(a)
Amortization of settlement	(210)		30		(66)		(a)
	(4,463)		(3,477)		(4,671)		Total before tax
	1,008		878		1,168		Income taxes
	(3,455)		(2,599)		(3,503)		Net of tax
Total reclassifications	$	(14,430)	$	5,967	$	(4,722)	Net of tax

(a)These items are included in the computation of net periodic pension cost. See Note 15 Employee Benefit Plans for additional information.

The following table presents changes in each component of accumulated comprehensive loss as of January 1, 2022 as follows (in thousands):


	Fiscal Year Ended January 1, 2022
	Foreign Currency		Derivative		Defined Benefit
	Translation		Instruments		Pension Plans		Total
Accumulated Other Comprehensive loss January 2, 2021, attributable to Darling, net of tax	$	(210,902)	$	(3,214)	$	(38,317)	$	(252,433)
Other comprehensive loss before reclassifications	(74,219)		(14,217)		9,214		(79,222)
Amounts reclassified from accumulated other comprehensive income	—		10,975		3,455		14,430

Net current-period other comprehensive income/(loss)	(74,219)		(3,242)		12,669		(64,792)
Noncontrolling interest	4,465		—		—		4,465
Accumulated Other Comprehensive loss January 1, 2022, attributable to Darling, net of tax	$	(289,586)	$	(6,456)	$	(25,648)	$	(321,690)