EX-99.1 2 exh991-pressreleaseq42023.htm EX-99.1 PRESS RELEASE Document

Exhibit 99.1    
FOR IMMEDIATE RELEASE darlingingredientslogoa.jpg
Feb. 27, 2024


Darling Ingredients Inc. Reports Fourth Quarter and Fiscal Year 2023 Results


Fiscal Year 2023 Highlights
•Net income of $647.7 million, or $3.99 per GAAP diluted share
•Net sales of $6.8 billion
•Combined adjusted EBITDA of $1,611.9 million
•Global ingredients business EBITDA of $1,109.9 million
•Received $163.6 million in cash dividends from Diamond Green Diesel
•Repurchased $52.9 million of common stock

IRVING, TEXAS - Darling Ingredients Inc.(NYSE: DAR) today reported net income of $84.5 million, or $0.52 per diluted share for fourth quarter of 2023, compared to net income of $156.6 million, or $0.96 per diluted share, for fourth quarter of 2022. The decrease in net income was primarily due to a decrease in Darling’s share of Diamond Green Diesel (DGD) earnings. The company also reported net sales of $1.6 billion for the fourth quarter of 2023, compared with net sales of $1.8 billion for the same period a year ago.

For the fiscal year ended Dec. 30, 2023, Darling Ingredients reported net sales of $6.8 billion, compared to net sales of $6.5 billion for fiscal year 2022. Net income for fiscal year 2023 was $647.7 million, or $3.99 per diluted share, as compared to net income of $737.7 million, or $4.49 per diluted share in fiscal year 2022.

“Darling Ingredients had another great year with its 6th record year of growth in volumes and combined adjusted EBITDA,” said Randall C. Stuewe, Darling Ingredients Chairman and Chief Executive Officer. “Our vertically integrated business continues to demonstrate that Darling Ingredients can deliver strong earnings that offsets commodity volatility. ”

DGD sold 336.6 million gallons of renewable diesel for the fourth quarter 2023 at an average of $0.23 per gallon EBITDA. In 2023, DGD sold 1.2 billion gallons of renewable diesel at an average of $0.81 per gallon EBITDA. Darling Ingredients received a total of $163.6 million in cash dividends from the joint venture in 2023.

Combined adjusted EBITDA for the fourth quarter 2023 was $350.9 million, compared to $413.0 million for the same period in 2022. Combined adjusted EBITDA for fiscal year 2023 totaled $1.61 billion, as compared to $1.54 billion in fiscal year 2022.

As of Dec. 30, 2023, Darling Ingredients had $126.5 million in cash and cash equivalents, and $832.5 million available under its committed revolving credit agreement. Total debt outstanding as of Dec. 30, 2023, was $4.4 billion. The leverage ratio as measured by the company’s bank covenant was 3.26X as of Dec. 30, 2023. Capital expenditures were $174.9 million for the fourth quarter 2023, and $555.5 million for fiscal year 2023.

“Darling Ingredients is committed to continuing to drive shareholder results. We have built a strong business and remain optimistic on a strong performance in 2024,” Stuewe said.









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Segment Financial Tables (in thousands)
Feed IngredientsFood IngredientsFuel IngredientsCorporateTotal
Three Months Ended December 30, 2023 (unaudited)
Net sales$1,045,642 $423,836 $144,605 $— $1,614,083 
Cost of sales and operating expenses755,062 311,163 111,427 — 1,177,652 
Gross Margin290,580 112,673 33,178 — 436,431 
Loss (gain) on sale of assets1 (8,243)(40)— (8,282)
Selling, general and administrative expenses77,281 30,195 6,714 18,430 132,620 
Restructuring and asset impairment charges3,934 9,199 — — 13,133 
Acquisition and integration costs— — — 1,726 1,726 
Change in fair value of contingent consideration5,167 — — — 5,167 
Depreciation and amortization98,400 26,655 8,480 4,394 137,929 
Equity in net income of Diamond Green Diesel— — 4,690 — 4,690 
Segment operating income/(loss)$105,797 $54,867 $22,714 $(24,550)$158,828 
Equity in net income of other unconsolidated subsidiaries1,508 — — — 1,508 
Segment income/(loss)$107,305 $54,867 $22,714 $(24,550)$160,336 
Segment EBITDA$213,298 $90,721 $26,504 $(18,430)$312,093 
DGD adjusted EBITDA (Darling's Share)— — 38,816 — 38,816 
Combined adjusted EBITDA$213,298 $90,721 $65,320 $(18,430)$350,909 

Feed IngredientsFood IngredientsFuel IngredientsCorporateTotal
Three Months Ended December 31, 2022
Net sales$1,216,073 $387,733 $164,277 $— $1,768,083 
Cost of sales and operating expenses950,778 294,417 134,093 — 1,379,288 
Gross Margin265,295 93,316 30,184 — 388,795 
Loss (gain) on sale of assets169 (117)14 — 66 
Selling, general and administrative expenses73,736 28,073 3,769 16,142 121,720 
Restructuring and asset impairment charges— 21,109 — — 21,109 
Acquisition and integration costs— — — 2,738 2,738 
Depreciation and amortization91,282 14,722 8,606 2,774 117,384 
Equity in net income of Diamond Green Diesel— — 123,448 — 123,448 
Segment operating income/(loss)$100,108 $29,529 $141,243 $(21,654)$249,226 
Equity in net loss of other unconsolidated subsidiaries(831)— — — (831)
Segment income/(loss)$99,277 $29,529 $141,243 $(21,654)$248,395 
Segment EBITDA$191,390 $65,360 $26,401 $(16,142)$267,009 
DGD adjusted EBITDA (Darling's Share)— — 145,984 — 145,984 
Combined adjusted EBITDA$191,390 $65,360 $172,385 $(16,142)$412,993 







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Segment Financial Tables (in thousands)

Feed IngredientsFood IngredientsFuel IngredientsCorporateTotal
Twelve Months Ended December 30, 2023 (unaudited)
Net sales$4,472,592 $1,752,065 $563,423 $— $6,788,080 
Cost of sales and operating expenses3,385,859 1,310,581 446,620 — 5,143,060 
Gross Margin1,086,733 441,484 116,803 — 1,645,020 
Loss (gain) on sale of assets814 (8,144)(91)— (7,421)
Selling, general and administrative expenses310,363 128,464 23,543 80,164 542,534 
Restructuring and asset impairment charges4,026 14,527 — — 18,553 
Acquisition and integration costs— — — 13,884 13,884 
Change in fair value of contingent consideration(7,891)— — — (7,891)
Depreciation and amortization360,249 94,991 34,466 12,309 502,015 
Equity in net income of Diamond Green Diesel— — 366,380 — 366,380 
Segment operating income/(loss)$419,172 $211,646 $425,265 $(106,357)$949,726 
Equity in net income of other unconsolidated subsidiaries5,011 — — — 5,011 
Segment income/(loss)$424,183 $211,646 $425,265 $(106,357)$954,737 
Segment EBITDA$775,556 $321,164 $93,351 $(80,164)$1,109,907 
DGD adjusted EBITDA (Darling's Share)— — 501,987 — 501,987 
Combined adjusted EBITDA$775,556 $321,164 $595,338 $(80,164)$1,611,894 

Feed IngredientsFood IngredientsFuel IngredientsCorporateTotal
Twelve Months Ended December 31, 2022
Net sales$4,539,000 $1,459,630 $533,574 $— $6,532,204 
Cost of sales and operating expenses3,473,506 1,102,250 426,853 — 5,002,609 
Gross Margin1,065,494 357,380 106,721 — 1,529,595 
Gain on sale of assets(3,426)(1,008)(60)— (4,494)
Selling, general and administrative expenses258,781 101,681 13,690 62,456 436,608 
Restructuring and asset impairment charges8,557 21,109 — — 29,666 
Acquisition and integration costs— — — 16,372 16,372 
Depreciation and amortization295,249 59,029 29,500 10,943 394,721 
Equity in net income of Diamond Green Diesel— — 372,346 — 372,346 
Segment operating income/(loss)$506,333 $176,569 $435,937 $(89,771)$1,029,068 
Equity in net income of other unconsolidated subsidiaries5,102 — — — 5,102 
Segment income/(loss)$511,435 $176,569 $435,937 $(89,771)$1,034,170 
Segment EBITDA$810,139 $256,707 $93,091 $(62,456)$1,097,481 
DGD adjusted EBITDA (Darling's Share)— — 443,487 — 443,487 
Combined adjusted EBITDA$810,139 $256,707 $536,578 $(62,456)$1,540,968 

Segment EBITDA consists of segment income (loss), less equity in net income/loss from unconsolidated subsidiaries, less equity in net income of Diamond Green Diesel, plus depreciation and amortization, acquisition and integration costs, restructuring and asset impairment charges, change in fair value of contingent consideration, plus Darling’s share of DGD Adjusted EBITDA.
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Darling Ingredients Inc. and Subsidiaries
Consolidated Balance Sheets
December 30, 2023 and December 31, 2022

December 30, 2023December 31, 2022
ASSETS(unaudited)
Current assets:
Cash and cash equivalents$126,502 $127,016 
Restricted cash292 315 
Accounts receivable, net626,008 559,695 
Accounts receivable due from related party - Diamond Green Diesel172,283 116,878 
Inventories758,739 673,621 
Prepaid expenses105,657 85,665 
Income taxes refundable23,599 18,583 
Other current assets42,586 56,324 
Total current assets1,855,666 1,638,097 
Property, plant and equipment, net2,935,185 2,462,082 
Intangible assets, net1,075,892 865,122 
Goodwill2,484,502 1,970,377 
Investment in unconsolidated subsidiaries2,251,629 1,926,395 
Operating lease right-of-use assets205,539 186,141 
Other assets234,960 136,268 
Deferred income taxes17,711 17,888 
$11,061,084 $9,202,370 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt$60,703 $69,846 
Accounts payable, principally trade425,588 472,491 
Income taxes payable15,522 44,851 
Current operating lease liabilities55,325 49,232 
Accrued expenses440,999 432,023 
Total current liabilities998,137 1,068,443 
Long-term debt, net of current portion4,366,370 3,314,969 
Long-term operating lease liabilities154,903 141,703 
Other non-current liabilities349,809 298,933 
Deferred income taxes498,174 481,832 
Total liabilities6,367,393 5,305,880 
Commitments and contingencies
Stockholders' equity:
Common stock, $0.01 par value;1,744 1,736 
  Additional paid-in capital1,697,787 1,660,084 
Treasury stock, at cost(629,008)(554,451)
  Accumulated other comprehensive loss(198,346)(383,874)
  Retained earnings3,733,254 3,085,528 
Total Darling's stockholders' equity4,605,431 3,809,023 
Noncontrolling interests88,260 87,467 
Total Stockholders' Equity4,693,691 3,896,490 
$11,061,084 $9,202,370 

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Darling Ingredients Inc. and Subsidiaries
Consolidated Operating Results
For the Three and Twelve Months Ended Dec. 30, 2023 and Dec. 31, 2022
(in thousands, except per share data)


Three Months EndedTwelve Months Ended
(unaudited)$ Change(unaudited)$ Change
December 30,December 31,FavorableDecember 30,December 31,Favorable
20232022(Unfavorable)20232022(Unfavorable)
Net sales$1,614,083 $1,768,083 $(154,000)$6,788,080 $6,532,204 $255,876 
Costs and expenses:
Cost of sales and operating expenses1,177,652 1,379,288 201,636 5,143,060 5,002,609 (140,451)
(Gain) loss on sale of assets(8,282)66 8,348 (7,421)(4,494)2,927 
Selling, general and administrative expenses
132,620 121,720 (10,900)542,534 436,608 (105,926)
Restructuring and asset impairment charges13,133 21,109 7,976 18,553 29,666 11,113 
     Acquisition and integration costs1,726 2,738 1,012 13,884 16,372 2,488 
Change in fair value of contingent consideration5,167 — (5,167)(7,891)— 7,891 
Depreciation and amortization137,929 117,384 (20,545)502,015 394,721 (107,294)
Total costs and expenses1,459,945 1,642,305 182,360 6,204,734 5,875,482 (329,252)
Equity in net income of Diamond Green Diesel4,690 123,448 (118,758)366,380 372,346 (5,966)
Operating income158,828 249,226 (90,398)949,726 1,029,068 (79,342)
Other expense:
Interest expense(68,453)(46,139)(22,314)(259,223)(125,566)(133,657)
Foreign currency gain (loss)(206)(5,272)5,066 8,133 (11,277)19,410 
Other income (expense), net2,825 242 2,583 16,310 (3,609)19,919 
Total other expense(65,834)(51,169)(14,665)(234,780)(140,452)(94,328)
Equity in net income (loss) of other unconsolidated subsidiaries1,508 (831)2,339 5,011 5,102 (91)
Income from operations before income taxes94,502 197,226 (102,724)719,957 893,718 (173,761)
Income tax expense7,246 37,995 30,749 59,568 146,626 87,058 
Net income87,256 159,231 (71,975)660,389 747,092 (86,703)
Net income attributable to noncontrolling interests
(2,740)(2,671)(69)(12,663)(9,402)(3,261)
Net income attributable to Darling$84,516 $156,560 $(72,044)$647,726 $737,690 $(89,964)
Basic income per share:$0.53 $0.98 $(0.45)$4.05 $4.58 $(0.53)
Diluted income per share:$0.52 $0.96 $(0.44)$3.99 $4.49 $(0.50)
Number of diluted common shares:161,935 163,504 162,387 164,121 




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Darling Ingredients Inc. and Subsidiaries
Consolidated Statement of Cash Flows
For the Twelve Months Ended December 30, 2023 and December 31, 2022
(in thousands)
Twelve Months Ended
(unaudited)
December 30,December 31,
Cash flows from operating activities:20232022
Net income$660,389 $747,092 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization502,015 394,721 
Gain on sale of assets(7,421)(4,494)
Asset impairment4,734 29,666 
Deferred taxes(22,241)46,734 
Change in fair value of contingent consideration(7,891)— 
Decrease in long-term pension liability(1,040)(7,037)
Stock-based compensation expense33,156 25,005 
Write-off deferred loan costs653 — 
Deferred loan cost amortization6,216 4,984 
Equity in net income of Diamond Green Diesel and other unconsolidated subsidiaries(371,391)(377,448)
Distribution of earnings from Diamond Green Diesel and other unconsolidated subsidiaries168,277 95,546 
Changes in operating assets and liabilities, net of effects from acquisitions:
  Accounts receivable(10,832)(56,543)
  Income taxes refundable/payable(39,933)(3,495)
  Inventories and prepaid expenses49,582 (130,170)
  Accounts payable and accrued expenses(82,939)65,936 
  Other17,929 (16,758)
Net cash provided by operating activities899,263 813,739 
Cash flows from investing activities:
Capital expenditures(555,480)(391,309)
Acquisition, net of cash acquired(1,093,183)(1,772,437)
Investment in Diamond Green Diesel(75,000)(264,750)
Investment in other unconsolidated subsidiaries(27)— 
Loan to Diamond Green Diesel— (50,000)
Loan repayment from Diamond Green Diesel25,000 50,000 
Gross proceeds from sale of property, plant and equipment and other assets10,748 13,442 
Proceeds from insurance settlement14,014 — 
Payments related to routes and other intangibles(1,524)(1,492)
Net cash used in investing activities(1,675,452)(2,416,546)
Cash flows from financing activities:
Proceeds from long-term debt817,101 1,934,885 
Payments on long-term debt(319,367)(63,078)
Borrowings from revolving credit facility2,666,360 1,873,795 
Payments on revolving credit facility(2,194,902)(1,897,280)
Net cash overdraft financing(9,780)24,069 
Acquisition hold-back payments(3,793)— 
Deferred loan costs(9)(16,780)
Repurchase of common stock(52,941)(125,531)
Minimum withholding taxes paid on stock awards(17,296)(46,944)
Distributions to noncontrolling interests(9,081)(4,532)
Net cash provided by financing activities876,292 1,678,604 
Effect of exchange rate changes on cash flows14,179 5,299 
Net increase in cash, cash equivalents and restricted cash114,282 81,096 
Cash, cash equivalents and restricted cash at beginning of period150,168 69,072 
Cash, cash equivalents and restricted cash at end of period$264,450 $150,168 

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Diamond Green Diesel Joint Venture
Condensed Consolidated Balance Sheets
December 31, 2023 and December 31, 2022
(in thousands)
December 31,December 31,
20232022
Assets:
Total current assets$1,877,430 $1,304,805 
Property, plant and equipment, net3,838,800 3,866,854 
Other assets89,697 61,665 
Total assets$5,805,927 $5,233,324 
Liabilities and members' equity:
Total current portion of long term debt$278,639 $217,066 
Total other current liabilities417,918 515,023 
Total long term debt737,097 774,783 
Total other long term liabilities16,996 17,249 
Total members' equity4,355,277 3,709,203 
Total liabilities and members' equity$5,805,927 $5,233,324 


Diamond Green Diesel Joint Venture
Operating Financial Results
For the Three and Twelve Months Ended December 31, 2023 and 2022
(in thousands)



Three Months EndedTwelve Months Ended
$ Change$ Change
December 31,December 31,FavorableDecember 31,December 31,Favorable
20232022(Unfavorable)20232022(Unfavorable)
Revenues:
Operating revenues$1,633,795 $1,594,552 $39,243 $6,990,622 $5,501,166 $1,489,456 
Expenses:
Total costs and expenses less lower of cost or market inventory valuation and depreciation, amortization and accretion expense1,495,293 1,302,584 (192,709)5,925,778 4,614,192 (1,311,586)
Lower of cost or market (LCM) inventory valuation adjustment60,871 — (60,871)60,871 — (60,871)
Depreciation, amortization and accretion expense
58,881 36,054 (22,827)230,921 125,656 (105,265)
Total costs and expenses1,615,045 1,338,638 (276,407)6,217,570 4,739,848 (1,477,722)
Operating income18,750 255,914 (237,164)773,052 761,318 11,734 
Other income3,454 1,244 2,210 10,317 3,170 7,147 
Interest and debt expense, net(12,072)(10,262)(1,810)(49,857)(19,796)(30,061)
Income before income tax expense10,132 246,896 (236,764)733,512 744,692 (11,180)
Income tax expense752 — (752)752 — (752)
Net income$9,380 $246,896 $(237,516)$732,760 $744,692 $(11,932)

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Darling Ingredients Inc. reports Adjusted EBITDA results, which is a Non-GAAP financial measure, as a compliment 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 to Foreign Currency
For the Three and Twelve Months Ended December 30, 2023 and December 31, 2022
(in thousands)


Three Months EndedTwelve Months Ended
(unaudited)(unaudited)
Adjusted EBITDADecember 30,December 31,December 30,December 31,
(U.S. dollars in thousands)2023202220232022
Net income attributable to Darling$84,516 $156,560 $647,726 $737,690 
Depreciation and amortization137,929 117,384 502,015 394,721 
Interest expense68,453 46,139 259,223 125,566 
Income tax expense7,246 37,995 59,568 146,626 
Restructuring and asset impairment charges13,133 21,109 18,553 29,666 
Acquisition and integration costs1,726 2,738 13,884 16,372 
Change in fair value of contingent consideration5,167 — (7,891)— 
Foreign currency (gain) loss206 5,272 (8,133)11,277 
Other (income) expense, net(2,825)(242)(16,310)3,609 
Equity in net income of Diamond Green Diesel(4,690)(123,448)(366,380)(372,346)
Equity in net (income) loss of other unconsolidated subsidiaries(1,508)831 (5,011)(5,102)
Net income attributable to noncontrolling interests2,740 2,671 12,663 9,402 
Adjusted EBITDA (Non-GAAP)$312,093 $267,009 $1,109,907 $1,097,481 
Foreign currency exchange impact(7,932)(1)(10,830)(2)
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP)$304,161 $267,009 $1,099,077 $1,097,481 
DGD Joint Venture Adjusted EBITDA (Darling's share)$38,816 $145,984 $501,987 $443,487 
Darling plus Darling's share of DGD Joint Venture Adjusted EBITDA$350,909 $412,993 $1,611,894 $1,540,968 
(1) The average rate assumption used in this calculation were the actual average rate for the three months ended December 30, 2023 of €1.00:$1.07, R$1.00:$0.20 and CAD$1.00:$0.73 as compared to the average rate for the three months ended December 31, 2022 of €1.00:$1.02, R$1.00:$0.19 and CAD$1.00:$0.74, respectively.
(2) The average rate assumption used in this calculation were the actual average rate for the twelve months ended December 30, 2023 of €1.00:$1.08, R$1.00:$0.20 and CAD$1.00:$0.74, as compared to the average rate for the twelve months ended December 31, 2022 of €1.00:$1.05, R$1.00:$0.19 and CAD$1.00:$0.77, respectively.




About Darling Ingredients
A pioneer in circularity, Darling Ingredients Inc. (NYSE: DAR) takes material from the animal agriculture and food industries, and transforms them into valuable ingredients that nourish people, feed animals and crops, and fuel the world with renewable energy. The company operates over 260 facilities in more than 15 countries and processes about 15% of the world’s animal agricultural by-products, produces about 30% of the world’s collagen (both gelatin
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and hydrolyzed collagen), and is one of the largest producers of renewable energy. To learn more, visit darlingii.com. Follow us on LinkedIn.

Darling Ingredients Inc. will host a conference call to discuss the Company’s fourth quarter and fiscal year 2023 financial results at 9 a.m. Eastern Time (8 a.m. Central Time) on Feb. 28, 2024.

To join the call as a participant to ask a question, please register in advance to receive a confirmation email with the dial-in number and PIN for immediate access on Feb. 28, 2024, or call 844-868-8847 (United States) or 412-317-6593 (International) and ask for "The Darling Ingredients Call” that day.

A replay of the call will be available online via the webcast registration link and via phone at 877-344-7529 (United States), 855-669-9658 (Canada) or 412-317-0088 (International) using reference passcode 7150600. The phone replay will be available two hours after the call concludes through March 6, 2024.

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. It is presented here not as an alternative to net income, but rather as a measure of the Company's operating performance. Since EBITDA (generally, net income plus interest expense, taxes, depreciation and amortization) is not calculated identically by all companies, the presentation in this report may not be comparable to EBITDA or Adjusted EBITDA presentations disclosed by other companies. Adjusted EBITDA is calculated above and represents for any relevant period, net income/(loss) plus depreciation and amortization, restructuring and asset impairment charges, acquisition and integration costs, change in fair value of contingent consideration, interest expense, income tax provision, other income/(expense) and equity in net (income)/loss of unconsolidated subsidiary. Management believes that Adjusted EBITDA is useful in evaluating the Company's operating performance compared to that of other companies in its industry because the calculation of Adjusted EBITDA generally eliminates the effects of financing, income taxes and certain non-cash and other items that may vary for different companies for reasons unrelated to overall operating performance.

Pro forma Adjusted EBITDA to Foreign Currency is not a recognized accounting measurement under GAAP. The Company evaluates the impact of foreign currency on its adjusted EBITDA. DGD Joint Venture Adjusted EBITDA (Darling's share) is not reflected in the Adjusted EBITDA or the Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP).

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, 6% Notes, 5.25% Notes and 3.625% Notes that were outstanding at December 30, 2023. However, the amounts shown below for Adjusted EBITDA differ from the amounts calculated under similarly titled definitions in the Company’s Senior Secured Credit Facilities, 6% Notes, 5.25% Notes and 3.625% Notes, as those definitions permit further adjustments to reflect certain other nonrecurring costs, non-cash charges and cash dividends from the DGD Joint Venture. 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.

DGD Joint Venture Adjusted EBITDA (Darling’s share) is not a recognized accounting measure under GAAP; it should not be considered as an alternative to net income or equity in net income of Diamond Green Diesel, 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. The Company calculates DGD Joint Venture Adjusted EBITDA (Darling’s share) by taking DGD’s operating income plus DGD’s depreciation, amortization and accretion expense and then multiplying by 50% to get Darling’s share of DGD’s EBITDA.
Information reconciling forward-looking combined adjusted EBITDA to net income is unavailable to the Company without unreasonable effort. The Company is not able to provide reconciliations of combined adjusted EBITDA to net income because certain items required for such reconciliations are outside of the Company’s control and/or cannot be reasonably predicted, such as the impact of volatile commodity prices on the Company’s operations, impact of foreign currency exchange fluctuations, depreciation and amortization and the provision for income taxes. Preparation of such reconciliations for Darling Ingredients Inc. and the Company’s joint venture, Diamond Green Diesel, would require a forward-looking balance sheet, statement of operations and statement of cash flows, prepared in accordance with GAAP for each entity, and such forward-looking financial statements are unavailable to the Company without unreasonable effort. The Company provides guidance for its combined adjusted EBITDA outlook that it believes will be achieved; however, it cannot accurately predict all the components of the combined adjusted EBITDA calculation.

EBITDA per gallon is not a recognized accounting measurement under GAAP; it should not be considered as an alternative to net income or equity in income of Diamond Green Diesel, 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. EBITDA per gallon is presented here
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not as an alternative to net income or equity in income of Diamond Green Diesel, but rather as a measure of Diamond Green Diesel's operating performance. Since EBITDA per gallon (generally, net income plus interest expense, taxes, depreciation and amortization divided by total gallons sold) is not calculated identically by all companies, this presentation may not be comparable to EBITDA per gallon presentations disclosed by other companies. Management believes that EBITDA per gallon is useful in evaluating Diamond Green Diesel's operating performance compared to that of other companies in its industry because the calculation of EBITDA per gallon generally eliminates the effects of financing, income taxes and certain non-cash and other items presented on a per gallon basis that may vary for different companies for reasons unrelated to overall operating performance.


Cautionary Statements Regarding Forward-Looking Information:

This media release includes “forward-looking” statements that are subject to risks and uncertainties that could cause actual results 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,” “guidance,” “outlook,” “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. All statements other than statements of historical facts included in this release are 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.

Important factors that could cause actual results to differ materially from the Company’s expectations include: 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; reduced demands or prices for biofuels, biogases or renewable electricity; global demands for 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, reduced volume due to government regulations affecting animal production 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, used cooking oil, protein or collagen (including, without limitation, collagen peptides and gelatin) finished product prices; changes to government policies around the world relating to renewable fuels and greenhouse gas (“GHG”) emissions that adversely affect prices, margins or markets (including for the DGD Joint Venture), including 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; climate related adverse results, including with respect to the Company’s climate goals, targets or commitments; possible product recall resulting from developments relating to the discovery of unauthorized adulterations to food or food additives or products which do not meet specifications, contract requirements or regulatory standards; 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 in China and elsewhere; the occurrence of pandemics, epidemics or disease outbreaks, such as the 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 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, a decline in margins on the products produced by the DGD Joint Venture and issues relating to the announced SAF upgrade 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; tax changes, such as the introduction of a global minimum tax; difficulties or a significant disruption (including, without limitation, due to cyber-attack) in the Company’s information systems, networks or the confidentiality, availability or integrity of our data 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, including the Russia-Ukraine war and the Israeli-Palestinian conflict and other associated or emerging conflicts in the Middle East; 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, inflation rates, 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
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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 report 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. For more detailed discussion of these factors and other risks and uncertainties regarding the Company, its business and the industries in which it operates, see the Company’s filings with the SEC, including the Risk Factors discussion in Item 1A of Part I of the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 2023. The Company cautions readers that all forward-looking statements speak only as of the date made, and the Company undertakes no obligation to update any forward-looking statements, whether as a result of changes in circumstances, new events or otherwise.


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Darling Ingredients Contacts
Investors:    Suann Guthrie
Senior VP, Investor Relations, Sustainability & Communications
(469) 214-8202; suann.guthrie@darlingii.com

Media:        Jillian Fleming
Director, Global Communications
(972) 541-7115; jillian.fleming@darlingii.com
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