Darling Ingredients Inc. (DAR) Bundle
A Brief History of Darling Ingredients Inc.
Darling Ingredients Inc. (NYSE: DAR) has established itself as a leader in the sustainable ingredients industry. As of 2024, the company operates over 260 facilities across more than 15 countries, processing approximately 15% of the world’s animal agricultural by-products and producing around 30% of the global collagen supply.
Financial Performance Overview
For the third quarter of 2024, Darling Ingredients reported a net income of $16.9 million, or $0.11 per diluted share. This represents a significant decrease from the net income of $125 million, or $0.77 per diluted share, recorded in the same quarter of 2023. The total net sales for Q3 2024 were $1.4 billion, down from $1.6 billion year-over-year. The decline in profits was primarily attributed to lower fat prices and reduced earnings from the Diamond Green Diesel (DGD) joint venture.
Year-to-Date Financial Results
For the nine months ended September 28, 2024, Darling Ingredients reported:
- Total net sales: $4.3 billion (compared to $5.2 billion in 2023)
- Net income: $177 million, or $1.10 per diluted share (down from $563.2 million, or $3.47 per diluted share in 2023)
- Combined adjusted EBITDA: $790.4 million (compared to $1.26 billion in 2023)
| Financial Metric | 2024 Q3 | 2023 Q3 | 2024 YTD | 2023 YTD |
|---|---|---|---|---|
| Net Income | $16.9 million | $125 million | $177 million | $563.2 million |
| Total Net Sales | $1.4 billion | $1.6 billion | $4.3 billion | $5.2 billion |
| Combined Adjusted EBITDA | $236.7 million | $334.3 million | $790.4 million | $1.26 billion |
Operational Highlights
Darling Ingredients continues to innovate in the renewable energy sector, particularly through its joint venture with Diamond Green Diesel. In Q3 2024, DGD sold 316.6 million gallons of renewable diesel at an average EBITDA of $0.25 per gallon. Year-to-date, DGD has sold 959.5 million gallons at an average EBITDA of $0.48 per gallon.
As of September 28, 2024, Darling Ingredients had $114.8 million in cash and cash equivalents, with total debt outstanding at $4.25 billion. The projected leverage ratio was 4.04x, indicating a significant level of debt relative to earnings before interest, taxes, depreciation, and amortization (EBITDA).
Capital Expenditures
Capital expenditures for the third quarter of 2024 were reported at $67.4 million, with year-to-date expenditures reaching $259.1 million. These investments are aimed at enhancing production capabilities and supporting the company's expansion into sustainable aviation fuel production.
Future Outlook
Looking ahead, Darling Ingredients anticipates a combined adjusted EBITDA for the full fiscal year of between $1.15 billion and $1.175 billion. The company expects to benefit from steady raw material volumes and a supportive regulatory environment for renewable fuels.
| Metric | 2024 Projected |
|---|---|
| Combined Adjusted EBITDA | $1.15 - $1.175 billion |
| Total Debt Outstanding | $4.25 billion |
| Cash and Cash Equivalents | $114.8 million |
A Who Owns Darling Ingredients Inc. (DAR)
Major Shareholders
As of 2024, the ownership structure of Darling Ingredients Inc. (DAR) is characterized by significant institutional and individual investors. The largest shareholders are:
| Shareholder Type | Shareholder Name | Percentage Ownership |
|---|---|---|
| Institutional Investor | The Vanguard Group, Inc. | 10.2% |
| Institutional Investor | BlackRock, Inc. | 8.9% |
| Institutional Investor | State Street Corporation | 5.7% |
| Individual Investor | Randall C. Stuewe (Chairman & CEO) | 2.1% |
| Institutional Investor | Invesco Ltd. | 4.3% |
| Other Investors | Various individual and institutional investors | Various |
Stock Performance
As of late 2024, the stock performance of Darling Ingredients Inc. reflects a volatile market environment. The stock price has seen fluctuations due to changes in commodity prices and overall market conditions.
| Date | Stock Price (USD) | Market Cap (Billion USD) |
|---|---|---|
| January 2024 | 65.00 | 10.5 |
| April 2024 | 60.50 | 9.8 |
| July 2024 | 62.75 | 10.1 |
| October 2024 | 58.20 | 9.4 |
Financial Overview
For the nine months ended September 28, 2024, Darling Ingredients reported:
| Financial Metric | Amount (in USD) |
|---|---|
| Net Sales | 4.3 Billion |
| Net Income | 177 Million |
| EBITDA | 790.4 Million |
| Total Debt | 4.25 Billion |
| Cash and Cash Equivalents | 114.8 Million |
Joint Ventures
Darling Ingredients has a significant joint venture with Diamond Green Diesel (DGD), which influences its financial performance:
| Metric | Q3 2024 (USD) | Q3 2023 (USD) |
|---|---|---|
| Gallons Sold | 316.6 Million | 350 Million |
| Average EBITDA per Gallon | 0.25 | 0.35 |
| Cash Dividends Received | 111.2 Million | 150 Million |
Darling Ingredients Inc. (DAR) Mission Statement
Darling Ingredients Inc. is dedicated to transforming renewable resources into valuable products that nourish people, feed animals, and fuel the world sustainably. The company operates with a commitment to innovation and sustainability, aiming to minimize waste and maximize the utility of every resource.
Company Overview
As of 2024, Darling Ingredients operates over 260 facilities across more than 15 countries, processing approximately 15% of the world's animal agricultural by-products. The organization is a leader in the production of collagen, contributing to around 30% of the global market for both gelatin and hydrolyzed collagen. Furthermore, Darling Ingredients is recognized as one of the largest producers of renewable energy, leveraging waste materials into sustainable energy sources.
Financial Performance
For the nine months ended September 28, 2024, Darling Ingredients reported the following financial metrics:
| Metric | Value (in millions) |
|---|---|
| Net Sales | $4,297.5 |
| Net Income | $177.0 |
| Adjusted EBITDA | $790.4 |
| Cash and Cash Equivalents | $114.8 |
| Total Debt | $4,250.0 |
| Capital Expenditures | $259.1 |
| Projected Leverage Ratio | 4.04x |
Operational Highlights
In the third quarter of 2024, the company achieved significant operational metrics:
| Operational Metric | Value |
|---|---|
| Total Net Sales | $1,421.9 million |
| Net Income | $16.9 million |
| Combined Adjusted EBITDA | $236.7 million |
| Gallons of Renewable Diesel Sold | 316.6 million |
| Average EBITDA per Gallon | $0.25 |
| Cash Dividends from Diamond Green Diesel | $111.2 million |
Market Position and Future Outlook
Darling Ingredients maintains a strong market presence and is poised for growth, particularly in the renewable fuels sector. The company is actively commissioning a sustainable aviation fuel plant and anticipates favorable regulatory changes that will enhance its operational margins. For the full fiscal year 2024, Darling Ingredients expects combined adjusted EBITDA to be between $1.15 billion and $1.175 billion, reflecting the company's resilience in navigating volatile global commodity markets.
The financial outlook and strategic initiatives underscore Darling Ingredients’ commitment to sustainability and innovation within the food and renewable energy sectors, reinforcing its mission to create a more sustainable future.
How Darling Ingredients Inc. (DAR) Works
Business Overview
Darling Ingredients Inc. is a global leader in the sustainable processing of animal by-products and food waste into valuable ingredients. The company operates over 260 facilities across more than 15 countries, processing approximately 15% of the world's animal agricultural by-products and producing about 30% of the world's collagen.
Financial Performance 2024
For the third quarter of 2024, Darling Ingredients reported:
- Total net sales of $1.4 billion, down from $1.6 billion in Q3 2023.
- Net income of $16.9 million, or $0.11 per diluted share, compared to $125.0 million or $0.77 per diluted share in Q3 2023.
- Combined adjusted EBITDA of $236.7 million, down from $334.3 million in Q3 2023.
- Year-to-date cash dividends received from Diamond Green Diesel totaled $111.2 million.
Segment Performance
The following table outlines the net sales and operating income for Darling Ingredients by segment for the third quarter of 2024:
| Segment | Total Net Sales ($ million) | Operating Income ($ million) |
|---|---|---|
| Feed Ingredients | 927.5 | 30.5 |
| Food Ingredients | 357.3 | 30.3 |
| Fuel Ingredients | 137.1 | 13.7 |
| Corporate | - | (14.4) |
| Total | 1,421.9 | 60.1 |
Debt and Cash Position
As of September 28, 2024, Darling Ingredients had:
- Cash and cash equivalents of $114.8 million.
- Total debt outstanding of $4.25 billion.
- Revolving credit availability of $1.0 billion.
- Projected leverage ratio of 4.04x.
Market Trends and Future Outlook
Darling Ingredients anticipates improved performance in 2025, supported by:
- Ongoing commissioning of sustainable aviation fuel plants.
- Favorable regulatory changes promoting the use of waste fats and oils for renewable fuels.
Capital Expenditures
In the third quarter of 2024, capital expenditures totaled:
- $67.4 million.
Equity in Diamond Green Diesel
Diamond Green Diesel (DGD) reported:
- Sales of 316.6 million gallons of renewable diesel at an average EBITDA of $0.25 per gallon in Q3 2024.
- Year-to-date sales of 959.5 million gallons at an average EBITDA of $0.48 per gallon.
Adjusted EBITDA Projections
For the full fiscal year 2024, Darling Ingredients expects:
- Combined adjusted EBITDA in the range of $1.15 billion to $1.175 billion.
How Darling Ingredients Inc. (DAR) Makes Money
Overview of Business Segments
Darling Ingredients Inc. operates primarily through three segments: Feed Ingredients, Food Ingredients, and Fuel Ingredients. Each segment contributes differently to the company's revenue and profitability.
Feed Ingredients
In the Feed Ingredients segment, Darling Ingredients generates revenue by processing animal by-products into feed products for livestock. In the third quarter of 2024, total net sales for this segment amounted to $927.5 million, down from $1.048 billion in the same period of 2023, reflecting a decrease of $120.3 million.
Food Ingredients
The Food Ingredients segment focuses on producing edible products, such as gelatin and hydrolyzed collagen, from animal by-products. For the third quarter of 2024, the segment reported net sales of $357.3 million, compared to $455.7 million in the previous year, a decline of $98.4 million.
Fuel Ingredients
In the Fuel Ingredients segment, Darling Ingredients is a significant player in the renewable diesel market through its joint venture, Diamond Green Diesel (DGD). This segment earned $137.1 million in net sales during the third quarter of 2024, a slight increase from $121.7 million in the same quarter of 2023.
| Segment | Q3 2024 Net Sales (in millions) | Q3 2023 Net Sales (in millions) | Change (in millions) |
|---|---|---|---|
| Feed Ingredients | 927.5 | 1,048.0 | -120.5 |
| Food Ingredients | 357.3 | 455.7 | -98.4 |
| Fuel Ingredients | 137.1 | 121.7 | 15.4 |
Financial Performance
For the third quarter of 2024, Darling Ingredients reported total net sales of $1.4 billion, a reduction from $1.6 billion in Q3 2023. The overall decline reflects lower finished product pricing and reduced demand in certain segments.
In terms of profitability, the net income for Q3 2024 was $16.9 million, down from $125.0 million in Q3 2023. The decline was attributed to a sharp decrease in fat prices and lower earnings from the Diamond Green Diesel joint venture.
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Total Net Sales (in millions) | 1,421.9 | 1,625.2 | -203.3 |
| Net Income (in millions) | 16.9 | 125.0 | -108.1 |
| Combined Adjusted EBITDA (in millions) | 236.7 | 334.3 | -97.6 |
Diamond Green Diesel Joint Venture
Darling Ingredients has a significant equity stake in Diamond Green Diesel, which is a major contributor to its revenue. In Q3 2024, DGD sold 316.6 million gallons of renewable diesel at an average EBITDA of $0.25 per gallon, generating cash dividends of $111.2 million for Darling Ingredients. Year-to-date, DGD has sold approximately 959.5 million gallons at an average EBITDA of $0.48 per gallon.
Debt and Liquidity
As of September 28, 2024, Darling Ingredients reported total debt of $4.25 billion, with a projected leverage ratio of 4.04x. The company had $114.8 million in cash and cash equivalents, along with $1.0 billion available under its revolving credit agreement. Capital expenditures for the third quarter were $67.4 million, totaling $259.1 million for the first nine months of 2024.
| Financial Metric | Value |
|---|---|
| Total Debt (in billions) | 4.25 |
| Cash and Cash Equivalents (in millions) | 114.8 |
| Available Revolving Credit (in billions) | 1.0 |
| Capital Expenditures YTD (in millions) | 259.1 |
| Projected Leverage Ratio | 4.04x |
Outlook for 2025
Darling Ingredients anticipates a more favorable operating environment in 2025, driven by the commissioning of its sustainable aviation fuel plant and an evolving regulatory landscape supporting the use of waste fats and oils in renewable fuels. The company projects combined adjusted EBITDA for the full fiscal year 2024 to be between $1.15 billion and $1.175 billion.
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Article updated on 8 Nov 2024
Resources:
- Darling Ingredients Inc. (DAR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Darling Ingredients Inc. (DAR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Darling Ingredients Inc. (DAR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.