Darling Ingredients Inc. Reports Third Quarter 2020 Financial Results
11/03/2020 - 04:07 PM
IRVING, Texas , Nov. 3, 2020 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR, "Darling") --
Third Quarter 2020
Net income of $101.1 million , or $0.61 per GAAP diluted share Net Sales of $850.6 million Combined adjusted EBITDA of $218.5 million Diamond Green Diesel ("DGD") earned $2.41 EBITDA per gallon on approximately 80 million gallons sold Global Ingredients business trailing twelve month EBITDA of $467.6 million demonstrates the continued strength and diversity of the platform Darling reported net sales of $850.6 million for the third quarter of 2020, as compared with net sales of $842.0 million for the same period a year ago. Net income attributable to Darling for the three months ended September 26, 2020 was $101.1 million , or $0.61 per diluted share, compared to a net income of $25.7 million , or $0.15 per diluted share, for the third quarter of 2019.
"Better results in our food segment combined with a strong performance in our international fuel segment, drove the results for our best quarterly performance of 2020," said Randall C. Stuewe , Chairman and Chief Executive Officer of Darling Ingredients Inc. "We continue to see improved margins in our global rendering through better cost management and our hydrolyzed collagen sales most affected by the economic impact of COVID have seen a solid turnaround."
"DGD had record sales volume of 80 million gallons for the third quarter as our vertically integrated supply chain that supports the lowest cost production system and the lowest carbon scoring feedstocks in North America continued to produce strong results. The plant turnaround in October was completed on schedule as we look to finish up 2020 on a positive note producing 285 million gallons of renewable diesel for the year," Stuewe added.
"Our balance sheet remains strong as we paid down our outstanding term loan B by $145 million during the third quarter. Our leverage ratio as measured by our bank covenant was 1.93 at the end of the third quarter as we continue to work on achieving an investment grade rating in the future. Our capital expenditures stood at approximately $185 million for the first nine months of 2020, as we continue to effectively manage our capital expenditures," commented Stuewe.
For the nine months ended September 26, 2020 , Darling reported net sales of $2.6 billion , as compared with net sales of $2.5 billion for the same period of 2019. Net Income attributable to Darling for the first nine months of 2020 was $252.1 million , or $1.51 per diluted share, as compared to a net income of $70.0 million , or $0.42 per diluted share, for the first nine months of 2019.
In October 2020 , Darling acquired a private company that owned rendering plants located in Belgium for approximately $29 million . This acquisition adds approximately 50 million pounds of protein meals and 50 million pounds of animal fats to Darling's capabilities, giving the company a stronger position in rendered poultry products in Belgium .
As of September 26, 2020 , Darling had $66.0 million in cash and cash equivalents, and $934.3 million available under committed revolving credit agreements. Total debt outstanding at the end of the third quarter of 2020 was $1.5 billion .
Combined adjusted EBITDA was $218.5 million for the third quarter of 2020, compared to $147.8 million for the same period in 2019. On a year-to-date basis, combined adjusted EBITDA totaled $627.0 million for 2020, compared to $440.5 million on a year-to-date basis for 2019.
Segment Financial Tables (in thousands)
Three Months Ended September 26, 2020
Feed Ingredients
Food Ingredients
Fuel Ingredients
Corporate
Total
Net Sales
$ 483,025
$ 291,842
$ 75,702
$ -
$ 850,569
Cost of sales and operating expenses
361,576
226,745
50,047
-
638,368
Gross Margin
$ 121,449
$ 65,097
$ 25,655
$ -
$ 212,201
Loss/(gain) on sale of assets
167
16
(61)
-
122
Selling, general and administrative expenses
49,028
23,366
5,038
12,561
89,993
Depreciation and amortization
53,764
20,648
8,633
2,685
85,730
Equity in net income of Diamond Green Diesel
-
-
91,099
-
91,099
Segment operating income/(loss)
$ 18,490
$ 21,067
$ 103,144
$ (15,246)
$ 127,455
Equity in net income of unconsolidated subsidiaries
$ 906
$ -
$ -
$ -
$ 906
Segment Income/(loss)
$ 19,396
$ 21,067
$ 103,144
$ (15,246)
$ 128,361
Segment EBITDA
$ 72,254
$ 41,715
$ 20,678
$ (12,561)
$ 122,086
DGD adjusted EBITDA (Darling's Share)
$ -
$ -
$ 96,435
$ -
$ 96,435
Combined adjusted EBITDA
$ 72,254
$ 41,715
$ 117,113
$ (12,561)
$ 218,521
Three Months Ended September 28, 2019
Feed Ingredients
Food Ingredients
Fuel Ingredients
Corporate
Total
Net Sales
$ 496,978
$ 276,467
$ 68,604
$ -
$ 842,049
Cost of sales and operating expenses
379,792
214,643
58,488
-
652,923
Gross Margin
$ 117,186
$ 61,824
$ 10,116
$ -
$ 189,126
Loss/(gain) on sale of assets
(2,429)
(253)
13
-
(2,669)
Selling, general and administrative expenses
47,319
22,811
912
12,507
83,549
Depreciation and amortization
50,182
19,743
7,895
2,587
80,407
Equity in net income of Diamond Green Diesel
-
-
32,020
-
32,020
Segment operating income/(loss)
$ 22,114
$ 19,523
$ 33,316
$ (15,094)
$ 59,859
Equity in net loss of unconsolidated subsidiaries
$ (665)
$ -
$ -
$ -
$ (665)
Segment income/(loss)
$ 21,449
$ 19,523
$ 33,316
$ (15,094)
$ 59,194
Segment EBITDA
$ 72,296
$ 39,266
$ 9,191
$ (12,507)
$ 108,246
DGD adjusted EBITDA (Darling's Share)
$ -
$ -
$ 39,548
$ -
$ 39,548
Combined adjusted EBITDA
$ 72,296
$ 39,266
$ 48,739
$ (12,507)
$ 147,794
Segment Financial Tables (in thousands) continued
Nine Months Ended September 26, 2020
Feed Ingredients
Food Ingredients
Fuel Ingredients
Corporate
Total
Net Sales
$ 1,499,340
$ 841,070
$ 211,674
$ -
$ 2,552,084
Cost of sales and operating expenses
1,117,931
652,334
147,358
-
1,917,623
Gross Margin
$ 381,409
$ 188,736
$ 64,316
$ -
$ 634,461
Loss/(gain) on sale of assets
293
(30)
(53)
-
210
Selling, general and administrative expenses
153,459
71,406
10,645
40,869
276,379
Depreciation and amortization
159,968
60,925
24,705
8,113
253,711
Equity in net income of Diamond Green Diesel
-
-
252,411
-
252,411
Segment operating income/(loss)
$ 67,689
$ 56,435
$ 281,430
$ (48,982)
$ 356,572
Equity in net income of unconsolidated subsidiaries
$ 2,467
$ -
$ -
$ -
$ 2,467
Segment income/(loss)
$ 70,156
$ 56,435
$ 281,430
$ (48,982)
$ 359,039
Segment EBITDA
$ 227,657
$ 117,360
$ 53,724
$ (40,869)
$ 357,872
DGD adjusted EBITDA (Darling's Share)
$ -
$ -
$ 269,177
$ -
$ 269,177
Combined adjusted EBITDA
$ 227,657
$ 117,360
$ 322,901
$ (40,869)
$ 627,049
Nine Months Ended September 28, 2019
Feed Ingredients
Food Ingredients
Fuel Ingredients
Corporate
Total
Net Sales
$ 1,480,244
$ 830,466
$ 193,767
$ -
$ 2,504,477
Cost of sales and operating expenses
1,143,606
643,091
161,855
-
1,948,552
Gross Margin
$ 336,638
$ 187,375
$ 31,912
$ -
$ 555,925
Loss/(gain) on sale of assets
(7,343)
(13,518)
16
-
(20,845)
Selling, general and administrative expenses
142,615
68,129
583
38,242
249,569
Depreciation and amortization
148,271
59,115
24,055
7,616
239,057
Equity in net income of Diamond Green Diesel
-
-
94,390
-
94,390
Segment operating income/(loss)
$ 53,095
$ 73,649
$ 101,648
$ (45,858)
$ 182,534
Equity in net loss of unconsolidated subsidiaries
$ (1,087)
$ -
$ -
$ -
$ (1,087)
Segment income/(loss)
$ 52,008
$ 73,649
$ 101,648
$ (45,858)
$ 181,447
Segment EBITDA
$ 201,366
$ 132,764
$ 31,313
$ (38,242)
$ 327,201
DGD adjusted EBITDA (Darling's Share)
$ -
$ -
$ 113,270
$ -
113,270
Combined adjusted EBITDA
$ 201,366
$ 132,764
$ 144,583
$ (38,242)
$ 440,471
Darling Ingredients Inc. and Subsidiaries Condensed Consolidated Balance Sheets September 26, 2020 and December 28, 2019 (in thousands)
September 26,
December 28,
2020
2019
ASSETS
(unaudited)
Current assets:
Cash and cash equivalents
$ 65,845
$ 72,935
Restricted cash
110
110
Accounts receivable, net
373,583
406,338
Inventories
406,805
362,957
Prepaid expenses
52,359
46,599
Income taxes refundable
3,940
3,317
Other current assets
28,532
25,032
Total current assets
931,174
917,288
Property, plant and equipment, net
1,789,172
1,802,411
Intangible assets, net
474,793
526,394
Goodwill
1,239,343
1,223,291
Investment in unconsolidated subsidiaries
742,875
689,354
Operating lease right-of-use assets
142,269
124,726
Other assets
45,598
47,400
Deferred income taxes
15,762
14,394
$ 5,380,986
$ 5,345,258
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt
$ 26,185
$ 90,996
Accounts payable, principally trade
206,998
239,252
Income taxes payable
19,013
8,895
Current operating lease liabilities
40,973
37,805
Accrued expenses
330,385
311,391
Total current liabilities
623,554
688,339
Long-term debt, net of current portion
1,448,019
1,558,429
Long-term operating lease liabilities
105,821
91,424
Other noncurrent liabilities
102,559
115,785
Deferred income taxes
265,844
247,931
Total liabilities
2,545,797
2,701,908
Commitments and contingencies
Total Darling's stockholders' equity
2,773,920
2,565,819
Noncontrolling interests
61,269
77,531
Total stockholders' equity
$ 2,835,189
$ 2,643,350
$ 5,380,986
$ 5,345,258
Darling Ingredients Inc. and Subsidiaries Consolidated Operating Results For the Three-Month and Nine-Month Periods Ended September 26, 2020 and September 28, 2019 (in thousands, except per share data)
(unaudited)
Three Months Ended
Nine Months Ended
$ Change
$ Change
September 26,
September 28,
Favorable
September 26,
September 28,
Favorable
2020
2019
(Unfavorable)
2020
2019
(Unfavorable)
Net sales
$ 850,569
$ 842,049
$ 8,520
$ 2,552,084
$ 2,504,477
$ 47,607
Costs and expenses:
Cost of sales and operating expenses
638,368
652,923
14,555
1,917,623
1,948,552
30,929
Loss (gain) on sale of assets
122
(2,669)
(2,791)
210
(20,845)
(21,055)
Selling, general and administrative expenses
89,993
83,549
(6,444)
276,379
249,569
(26,810)
Depreciation and amortization
85,730
80,407
(5,323)
253,711
239,057
(14,654)
Total costs and expenses
814,213
814,210
(3)
2,447,923
2,416,333
(31,590)
Equity in net income of Diamond Green Diesel
91,099
32,020
59,079
252,411
94,390
158,021
Operating income
127,455
59,859
67,596
356,572
182,534
174,038
Other expense:
Interest expense
(18,793)
(19,359)
566
(55,803)
(60,088)
4,285
Debt extinguishment costs
-
-
-
-
(12,126)
12,126
Foreign currency gain/(loss)
(1,239)
466
(1,705)
(709)
(654)
(55)
Other expense, net
(1,912)
(2,614)
702
(5,278)
(7,158)
1,880
Total other expense
(21,944)
(21,507)
(437)
(61,790)
(80,026)
18,236
Equity in net income/(loss)
of unconsolidated subsidiaries
906
(665)
1,571
2,467
(1,087)
3,554
Income before income taxes
106,417
37,687
68,730
297,249
101,421
195,828
Income tax expense
4,812
10,850
6,038
43,058
23,900
(19,158)
Net income
101,605
26,837
74,768
254,191
77,521
176,670
Net income attributable to
noncontrolling interests
(480)
(1,116)
636
(2,117)
(7,530)
5,413
Net income attributable to Darling
$ 101,125
$ 25,721
$ 75,404
$ 252,074
$ 69,991
$ 182,083
Basic income per share:
$ 0.62
$ 0.16
$ 0.46
$ 1.55
$ 0.42
$ 1.13
Diluted income per share:
$ 0.61
$ 0.15
$ 0.46
$ 1.51
$ 0.42
$ 1.09
Number of diluted common shares:
166,997
168,266
166,974
168,453
Darling Ingredients Inc. and Subsidiaries Consolidated Statement of Cash Flows Periods Ended September 26, 2020 and September 28, 2019 (in thousands) (unaudited)
Nine Months Ended
Sept 26,
Sept 28,
Cash flows from operating activities:
2020
2019
Net income
$ 254,191
$ 77,521
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
253,711
239,057
Loss/(gain) on disposal of property, plant, equipment and other assets
210
(20,845)
Gain on insurance proceeds from insurance settlement
-
(1,371)
Deferred taxes
13,362
(4,765)
Increase (decrease) in long-term pension liability
(7,960)
1,122
Stock-based compensation expense
19,202
18,543
Write-off deferred loan costs
2,419
4,721
Deferred loan cost amortization
4,242
4,435
Equity in net income of Diamond Green Diesel and other unconsolidated subsidiaries
(254,878)
(93,303)
Distributions of earnings from Diamond Green Diesel and other unconsolidated subsidiaries
207,165
57,118
Changes in operating assets and liabilities, net of effects from acquisitions:
Accounts receivable
36,083
20,388
Income taxes refundable/payable
8,282
8,058
Inventories and prepaid expenses
(43,980)
(34,371)
Accounts payable and accrued expenses
(10,832)
(19,799)
Other
(10,804)
6,173
Net cash provided by operating activities
470,413
262,682
Cash flows from investing activities:
Capital expenditures
(184,919)
(245,092)
Acquisitions, net of cash acquired
-
(1,431)
Investment in unconsolidated subsidiary
-
(2,000)
Gross proceeds from disposal of property, plant and equipment and other assets
1,291
15,402
Proceeds from insurance settlement
-
1,371
Payments related to routes and other intangibles
(3,712)
(3,150)
Net cash used by investing activities
(187,340)
(234,900)
Cash flows from financing activities:
Proceeds from long-term debt
24,085
511,985
Payments on long-term debt
(171,640)
(566,107)
Borrowings from revolving credit facility
390,971
325,485
Payments on revolving credit facility
(415,800)
(332,884)
Net cash overdraft financing
(33,385)
27,858
Deferred loan costs
(3,688)
(7,027)
Issuance of common stock
67
39
Repurchase of common stock
(55,044)
(11,740)
Minimum withholding taxes paid on stock awards
(7,980)
(3,247)
Acquisition of noncontrolling interest
(8,784)
-
Distributions to noncontrolling interests
(6,253)
(4,500)
Net cash used by financing activities
(287,451)
(60,138)
Effect of exchange rate changes on cash flows
(2,712)
(5,732)
Net decrease in cash, cash equivalents and restricted cash
(7,090)
(38,088)
Cash, cash equivalents and restricted cash at beginning of year
73,045
107,369
Cash, cash equivalents and restricted cash at end of period
$ 65,955
$ 69,281
Supplemental disclosure of cash flow information:
Accrued capital expenditures
$ (2,202)
$ 3,978
Cash paid during the period for:
Interest, net of capitalized interest
$ 39,481
$ 49,727
Income taxes, net of refunds
$ 24,868
$ 21,475
Non-cash operating activities:
Operating lease right of use obtained in exchange for new lease liabilities
$ 44,479
$ 16,425
Non-cash financing activities:
Debt issued for service contract assets
$ 21
$ -
Diamond Green Diesel Joint Venture Condensed Consolidated Balance Sheets September 30, 2020 and December 31, 2019 (in thousands)
September 30,
December 31,
2020
2019
Assets:
(unaudited)
Total current assets
$ 465,669
$ 668,026
Property, plant and equipment, net
1,039,802
713,489
Other assets
32,813
30,710
Total assets
$ 1,538,284
$ 1,412,225
Liabilities and members' equity:
Total current portion of long term debt
$ 506
$ 341
Total other current liabilities
98,618
75,802
Total long term debt
8,839
8,742
Total other long term liabilities
3,875
4,422
Total members' equity
1,426,446
1,322,918
Total liabilities and members' equity
$ 1,538,284
$ 1,412,225
Diamond Green Diesel Joint Venture Operating Financial Results For the Three-Month and Nine-Month Periods Ended September 30, 2020 and September 30, 2019 (in thousands) (unaudited)
Three Months Ended
Nine Months Ended
$ Change
$ Change
September 30,
September 30,
Favorable
September 30,
September 30,
Favorable
Revenues:
2020
2019
(Unfavorable)
2020
2019
(Unfavorable)
Operating revenues
$ 346,276
$ 262,118
$ 84,158
$ 1,000,717
$ 859,647
$ 141,070
Expenses:
Total costs and expenses less
depreciation, amortization and accretion expense
153,406
183,022
29,616
462,364
633,109
170,745
Depreciation, amortization and
10,772
15,242
4,470
33,660
38,574
4,914
accretion expense
Total costs and expenses
164,178
198,264
34,086
496,024
671,683
175,659
Operating income
182,098
63,854
118,244
504,693
187,964
316,729
Other income
415
506
(91)
1,076
1,781
(705)
Interest and debt expense, net
(315)
(320)
5
(947)
(965)
18
Net income
$ 182,198
$ 64,040
$ 118,158
$ 504,822
$ 188,780
$ 316,042
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 Nine-Month Periods Ended September 26, 2020 and September 28, 2019
Three Months Ended
Nine Months Ended
Adjusted EBITDA
September 26,
September 28,
September 26,
September 28,
(U.S. dollars in thousands)
2020
2019
2020
2019
Net income attributable to Darling
$ 101,125
$ 25,721
$ 252,074
$ 69,991
Depreciation and amortization
85,730
80,407
253,711
239,057
Interest expense
18,793
19,359
55,803
60,088
Income tax expense
4,812
10,850
43,058
23,900
Foreign currency loss/(gain)
1,239
(466)
709
654
Other expense, net
1,912
2,614
5,278
7,158
Debt extinguishment costs
-
-
-
12,126
Equity in net income of Diamond Green Diesel
(91,099)
(32,020)
(252,411)
(94,390)
Equity in net (income)/loss of unconsolidated subsidiaries
(906)
665
(2,467)
1,087
Net income attributable to noncontrolling interests
480
1,116
2,117
7,530
Adjusted EBITDA (Non-GAAP)
$ 122,086
$ 108,246
$ 357,872
$ 327,201
Foreign currency exchange impact
(3,702)
(1)
-
407
(2)
-
Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP)
$ 118,384
$ 108,246
$ 358,279
$ 327,201
DGD Joint Venture Adjusted EBITDA (Darling's Share)
$ 96,435
$ 39,548
$ 269,177
$ 113,270
Darling plus Darling's share of DGD Joint Venture Adjusted EBITDA
$ 218,521
$ 147,794
$ 627,049
$ 440,471
(1) The average rate assumption used in this calculation was the actual fiscal average rate for the three months ended
September 26, 2020 of €1.00 :USD$1.17 and CAD$1.00 :USD$0.75 , as compared to the average rate for the three months ended
September 28, 2019 of €1.00 :USD$1.11 and CAD$1.00 :USD$0.76 , respectively.
(2) The average rate assumption used in this calculation was the actual fiscal average rate for the nine months ended
September 26, 2020 of €1.00 :USD$1.12 and CAD$1.00 :USD$0.74 , as compared to the average rate for the nine months ended
September 28, 2019 of €1.00 :USD$1.12 and CAD$1.00 :USD$0.75 , respectively.
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.
Darling Ingredients Inc. will host a conference call to discuss the Company's third quarter 2020 financial results at 9:00 am Eastern Time (8:00 am Central Time ) on Wednesday, November 4 , 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 10149629. 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 11, 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 10149629. 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 expense, 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, 5.25% Notes and 3.625% Notes that were outstanding at September 26, 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, 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.