IRVING, Texas, May 8, 2019 /PRNewswire/ -- Darling Ingredients
Inc. (NYSE: DAR), a global developer and producer of sustainable
natural ingredients from edible and inedible bio-nutrients,
creating a wide range of ingredients and customized specialty
solutions for customers in the pharmaceutical, food, pet food,
feed, industrial, fuel, bioenergy, and fertilizer
industries, today announced financial results for the 2019
first quarter ended March 30,
2019.
First Quarter 2019 Overview
- Revenue of $835.1
million
- Net income of $18.0
million
- Adjusted EBITDA of $103.4
million
- Difficult winter and North
America flooding impacted operations
- Continued strong global raw material volumes, up 2.7 percent
year over year
- High global slaughter volumes, China trade disruptions and African Swine
Fever (ASF) created lower pricing environment for Feed segment fats
and proteins
- Collagen business drove record Food segment
earnings
- Diamond Green Diesel ("DGD")
JV issued $17.7 million partner
dividend in early April
- Launched and priced U.S. Bonds refinance in late March,
extending maturity from 2022 to 2027 with more favorable
terms
For the first quarter of 2019, the Company reported net sales of
$835.1 million, as compared with net
sales of $875.4 million for the first
quarter of 2018. Net income attributable to Darling for the
three months ended March 30, 2019 was
$18.0 million, or $0.11 per diluted share, compared to a net income
of $97.3 million, or $0.58 per diluted share, for the first quarter of
2018. The year-over-year decrease in net income for the first
quarter 2019 is primarily due to the inclusion of the 2017
retroactive blenders tax credit ("BTC") in the results for the
first quarter 2018, as compared to no BTC, to date, in 2019.
Additionally, lower pet grade protein margins, higher energy costs
due to a difficult winter, FX variance and costs associated with
North America flooding negatively
impacted earnings.
Comments on the First Quarter 2019
"Our teams executed well during the first quarter 2019 despite
headwinds impacting our finished product pricing, challenging
weather events disrupting some of our operations in North America and African Swine Fever
pressuring the global marketplace," said Randall C. Stuewe, Chairman and Chief Executive
Officer of Darling Ingredients Inc. "Global volumes trended higher,
the Food segment reported record results, and we delivered overall
improved adjusted EBITDA when adjusting the prior year for the BTC
and a stronger U.S. dollar."
"Construction is underway on Super Diamond that increases annual
production capacity at our Diamond Green Diesel JV to 675 million
gallons of renewable diesel plus additional renewable naphtha. We
anticipate completion in fourth quarter 2021," Stuewe
concluded.
Operational Update by Segment
- Feed Ingredients – Pricing environment pressured
by ample oilseed supplies with slight improvement in fats pricing.
China trade disruptions and ASF
weighed on protein values along with seasonally weaker demand for
North America pet food. Extreme
weather events, including Midwest flooding, disrupted logistics and
plant operations in North America.
Strong slaughter drove global volumes up 3 percent
year-over-year.
- Food Ingredients – Rousselot collagen business
excelled operationally and gained market share, delivering robust
earnings led by volume growth in new product mix changes and
improved margins, which more than offset lower CTH casings margins
from decreased sales volumes. Lower segment sales resulted from the
2018 Argentina collagen plant closure while China and South American markets performed as
expected. Strengthening Euro tempered margins at European
operations. Deflationary global palm oil markets pressured Sonac
edible fats margins.
- Fuel Ingredients – Segment showed consistent
performance absent the $12.6 million
BTC that was made retroactive for 2017 and booked in February 2018. Ecoson bioenergy operations
delivered improved performance with the addition of our
Belgium digester contributing
solid earnings. Rendac, our European disposal rendering business,
reflected softened results with lower livestock and slaughter
volumes. North American biodiesel facilities reported steady
earnings without the BTC.
- Diamond Green Diesel Joint
Venture (DGD) – DGD met expectations with first
quarter earnings impacted by the reversal of hedge gain realized in
the 2018 fourth quarter. Results reflect entity level EBITDA of
$0.84 per gallon on 71.1 million
gallons of sales. Since its latest expansion to 275 million
gallons, DGD is tracking on target when averaging Q4 2018 and Q1
2019 EBITDA per gallon to a net run rate of $1.24 EBITDA per gallon. JV partner dividend of
$17.7 million received early
April 2019. Super Diamond phase three
expansion is underway and on schedule, expanding capacity by 400
million gallons in a parallel plant, which will increase annual
production to 675 million gallons of renewable diesel plus an
additional 50-60 million gallons of renewable naphtha for green
gasoline markets. Estimated expansion costs of $1.1 billion is expected to be substantially
funded by entity's cash flows.
Financial Update by Segment
Feed
Ingredients
|
Three Months
Ended
|
($
thousands)
|
March 30,
2019
|
March 31,
2018
|
Net Sales
|
$
495,819
|
$
485,798
|
Selling, general and
administrative expenses
|
48,831
|
48,265
|
Depreciation and
amortization
|
49,369
|
46,789
|
Segment operating
Income
|
15,151
|
21,656
|
EBITDA
|
$
64,520
|
$
68,445
|
|
*EBITDA calculated by
adding depreciation and amortization to segment operating
income.
|
- Feed Ingredients operating income for the three months ended
March 30, 2019 was $15.2 million, a decrease of $6.5 million or (30.0)% as compared to the three
months ended March 31, 2018. Feed
Ingredients segment operating income was down in the three months
ended March 30, 2019 as compared to
the same period in fiscal 2018 due to an increase in raw material
prices relative to the sales price in the domestic markets and less
favorable supply volume mix which compressed margins in the
international markets that more than offset higher volumes and
higher prices in North American markets.
Food
Ingredients
|
Three Months
Ended
|
($
thousands)
|
March 30,
2019
|
March 31,
2018
|
Net Sales
|
$
279,164
|
$
305,520
|
Selling, general and
administrative expenses
|
21,887
|
23,861
|
Depreciation and
amortization
|
19,511
|
20,640
|
Segment operating
Income
|
23,648
|
11,834
|
EBITDA
|
$
43,159
|
$
32,474
|
|
*EBITDA calculated by
adding depreciation and amortization to segment operating
income.
|
- Food Ingredients operating income was $23.6 million for the three months ended
March 30, 2019, an increase of
$11.8 million or 100.0% as compared
to the three months ended March 31,
2018. The increase was primarily due to improved results in
gelatin and collagen markets. The Company's edible fat prices were
lower as a result of lower competing fat markets as compared to the
same period in fiscal 2018. The casings business delivered lower
earnings due to lower sales volumes and lower margins as compared
to the same period in fiscal 2018.
Fuel
Ingredients
|
Three Months
Ended
|
($
thousands)
|
March 30,
2019
|
March 31,
2018
|
Net Sales
|
$
60,121
|
$
84,056
|
Selling, general and
administrative expenses
|
(754)
|
(1,398)
|
Depreciation and
amortization
|
7,798
|
8,471
|
Segment operating
Income
|
3,000
|
17,157
|
EBITDA
|
$
10,798
|
$
25,628
|
|
*EBITDA calculated by
adding depreciation and amortization to segment operating
income.
|
- Exclusive of the DGD Joint Venture, the Company's Fuel
Ingredients segment income for the three months ended March 30, 2019 was $3.0
million, a decrease of $14.2
million or (82.6)% as compared to the same period in fiscal
2018. The decrease in earnings is primarily related to the fiscal
2017 blenders tax credits recorded in the first quarter of fiscal
2018 in North America as compared
to no blenders tax credits booked in the same period of fiscal
2019.
Darling
Ingredients Inc. and Subsidiaries
|
Consolidated
Operating Results
|
For the Periods
Ended March 30, 2019 and March 31, 2018
|
(in thousands, except
per share data)
|
(unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
$ Change
|
|
|
March 30,
|
|
March 31,
|
|
Favorable
|
|
|
2019
|
|
2018
|
|
(Unfavorable)
|
Net sales
|
$835,104
|
|
$875,374
|
|
$
(40,270)
|
Costs and
expenses:
|
|
|
|
|
|
|
Cost of sales and
operating expenses
|
646,663
|
|
678,099
|
|
31,436
|
|
Selling, general and
administrative expenses
|
85,003
|
|
86,902
|
|
1,899
|
|
Depreciation and
amortization
|
79,164
|
|
78,619
|
|
(545)
|
Total costs and
expenses
|
810,830
|
|
843,620
|
|
32,790
|
Operating
income
|
24,274
|
|
31,754
|
|
(7,480)
|
|
|
|
|
|
|
|
Other
expense:
|
|
|
|
|
|
|
Interest
expense
|
(19,876)
|
|
(23,124)
|
|
3,248
|
|
Foreign currency
loss
|
(732)
|
|
(1,481)
|
|
749
|
|
Other expense,
net
|
(2,525)
|
|
(2,516)
|
|
(9)
|
Total other
expense
|
(23,133)
|
|
(27,121)
|
|
3,988
|
|
|
|
|
|
|
|
Equity in net income
of unconsolidated subsidiaries
|
23,773
|
|
97,154
|
|
(73,381)
|
Income before income
taxes
|
24,914
|
|
101,787
|
|
(76,873)
|
Income tax
expense
|
5,274
|
|
3,712
|
|
(1,562)
|
Net income
|
19,640
|
|
98,075
|
|
(78,435)
|
Net income
attributable to noncontrolling interests
|
(1,628)
|
|
(770)
|
|
(858)
|
Net income
attributable to Darling
|
$
18,012
|
|
$
97,305
|
|
$
(79,293)
|
|
|
|
|
|
|
|
Basic income per
share
|
$
0.11
|
|
$
0.59
|
|
$
(0.48)
|
Diluted income per
share
|
$
0.11
|
|
$
0.58
|
|
$
(0.47)
|
|
|
|
|
|
|
|
Number of diluted
common shares:
|
168,660
|
|
167,742
|
|
|
Darling
Ingredients Inc. and Subsidiaries
|
Condensed
Consolidated Balance Sheets
|
March 30, 2019 and
December 29, 2018
|
(in
thousands)
|
|
|
|
March 30,
|
|
December
29,
|
|
|
2019
|
|
2018
|
ASSETS
|
(unaudited)
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
95,716
|
|
$
107,262
|
|
Restricted
cash
|
107
|
|
107
|
|
Accounts Receivable,
net
|
371,339
|
|
385,737
|
|
Inventories
|
339,882
|
|
341,028
|
|
Prepaid
expenses
|
39,070
|
|
35,247
|
|
Income taxes
refundable
|
4,102
|
|
6,462
|
|
Other current
assets
|
20,959
|
|
22,099
|
|
Total current assets
|
871,175
|
|
897,942
|
|
|
|
|
|
Property, plant and
equipment, net
|
1,691,558
|
|
1,687,858
|
Intangible assets,
net
|
579,313
|
|
595,862
|
Goodwill
|
1,222,382
|
|
1,229,159
|
Investment in
unconsolidated subsidiaries
|
433,381
|
|
410,177
|
Operating lease
right-of-use assets
|
129,721
|
|
-
|
Other
assets
|
53,487
|
|
53,375
|
Deferred income
taxes
|
14,037
|
|
14,981
|
|
|
$
4,995,054
|
|
$
4,889,354
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
|
Current portion of
long-term debt
|
$
23,693
|
|
$
7,492
|
|
Accounts payable,
principally trade
|
192,511
|
|
219,479
|
|
Income taxes
payable
|
8,861
|
|
4,043
|
|
Current operating
lease liabilities
|
39,776
|
|
-
|
|
Accrued
expenses
|
281,331
|
|
309,484
|
|
Total current liabilities
|
546,172
|
|
540,498
|
Long-term debt, net
of current portion
|
1,663,763
|
|
1,666,940
|
Long-term operating
lease liabilities
|
89,100
|
|
-
|
Other noncurrent
liabilities
|
113,984
|
|
115,032
|
Deferred income
taxes
|
225,336
|
|
231,063
|
|
Total liabilities
|
2,638,355
|
|
2,553,533
|
Commitments and
contingencies
|
|
|
|
Total Darling's
stockholders' equity
|
2,290,539
|
|
2,273,048
|
Noncontrolling
interests
|
66,160
|
|
62,773
|
|
Total stockholders' equity
|
$
2,356,699
|
|
$
2,335,821
|
|
|
$
4,995,054
|
|
$
4,889,354
|
Darling
Ingredients Inc. and Subsidiaries
|
Consolidated
Statement of Cash Flows
|
Three Months Ended
March 30, 2019 and March 31, 2018
|
(in
thousands)
|
(unaudited)
|
|
|
|
Three Months
Ended
|
|
|
|
|
March 30,
|
|
March 31,
|
Cash flows from
operating activities:
|
2019
|
|
2018
|
|
Net income
|
|
$
19,640
|
|
$
98,075
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
79,164
|
|
78,619
|
|
|
Gain on disposal of
property, plant, equipment and other assets
|
(4,250)
|
|
(462)
|
|
|
Gain on insurance
proceeds from insurance settlements
|
(845)
|
|
(503)
|
|
|
Deferred
taxes
|
(2,901)
|
|
(2,649)
|
|
|
Increase in long-term
pension liability
|
646
|
|
159
|
|
|
Stock-based
compensation expense
|
10,327
|
|
8,992
|
|
|
Write-off deferred
loan costs
|
27
|
|
-
|
|
|
Deferred loan cost
amortization
|
1,574
|
|
2,939
|
|
|
Equity in net income
of unconsolidated subsidiaries
|
(23,773)
|
|
(97,154)
|
|
|
Changes in operating
assets and liabilities, net of effects from
acquisitions:
|
|
|
|
|
|
Accounts
receivable
|
11,692
|
|
(14,590)
|
|
|
Income taxes
refundable/payable
|
7,270
|
|
(1,384)
|
|
|
Inventories
and prepaid expenses
|
(5,063)
|
|
(10,182)
|
|
|
Accounts
payable and accrued expenses
|
(43,016)
|
|
(38,422)
|
|
|
Other
|
|
(1,891)
|
|
3,486
|
|
|
|
Net cash provided by
operating activities
|
48,601
|
|
26,924
|
Cash flows from
investing activities:
|
|
|
|
|
Capital
expenditures
|
(84,269)
|
|
(56,587)
|
|
Acquisitions, net of
cash acquired
|
(1,431)
|
|
-
|
|
Investment of
unconsolidated subsidiaries
|
-
|
|
(3,500)
|
|
Proceeds from sale of
investment in subsidiary
|
-
|
|
2,805
|
|
Gross proceeds from
disposal of property, plant and equipment and other
assets
|
7,868
|
|
1,479
|
|
Proceeds from
insurance settlement
|
845
|
|
503
|
|
Payments related to
routes and other intangibles
|
(2,778)
|
|
(15)
|
|
|
|
Net cash used by
investing activities
|
(79,765)
|
|
(55,315)
|
Cash flows from
financing activities:
|
|
|
|
|
Proceeds from
long-term debt
|
2,138
|
|
3,876
|
|
Payments on long-term
debt
|
(10,974)
|
|
(9,622)
|
|
Borrowings from
revolving credit facility
|
156,829
|
|
135,184
|
|
Payments on revolving
credit facility
|
(138,147)
|
|
(80,019)
|
|
Net cash overdraft
financing
|
14,525
|
|
(331)
|
|
Deferred loan
costs
|
-
|
|
(1,094)
|
|
Issuance of common
stock
|
12
|
|
182
|
|
Minimum withholding
taxes paid on stock awards
|
(3,190)
|
|
(2,018)
|
|
|
|
Net cash provided by
financing activities
|
21,193
|
|
46,158
|
Effect of exchange
rate changes on cash
|
(1,575)
|
|
(1,672)
|
Net
increase/(decrease) in cash, cash equivalents and restricted
cash
|
(11,546)
|
|
16,095
|
Cash, cash
equivalents and restricted cash at beginning of period
|
107,369
|
|
106,916
|
Cash, cash
equivalents and restricted cash at end of period
|
$
95,823
|
|
$
123,011
|
Supplemental
disclosure of cash flow information:
|
|
|
|
|
Accrued capital
expenditures
|
$
(8,623)
|
|
$
(1,934)
|
|
Cash paid during the
period for:
|
|
|
|
|
|
Interest, net of
capitalized interest
|
$
21,602
|
|
$
19,142
|
|
|
Income taxes, net of
refunds
|
$
2,894
|
|
$
7,120
|
|
Non-cash financing
activities:
|
|
|
|
|
|
Operating lease right
of use asset
|
$
4,794
|
|
$
-
|
|
|
Operating lease
obligations
|
|
|
|
|
|
Debt issued for
assets
|
$
-
|
|
$
17
|
Selected financial information for the Company's Diamond Green Diesel Joint Venture is as
follows:
Diamond Green
Diesel Joint Venture
|
Condensed
Consolidated Balance Sheets
|
March 31, 2019 and
December 31, 2018
|
(in
thousands)
|
|
|
|
|
March 31,
|
|
December
31,
|
|
|
|
2019
|
|
2018
|
Assets:
|
|
|
|
|
Total current
assets
|
$ 225,948
|
|
$
186,258
|
|
Property, plant and
equipment, net
|
591,927
|
|
576,384
|
|
Other
assets
|
26,427
|
|
24,601
|
|
|
Total
assets
|
$ 844,302
|
|
$
787,243
|
|
|
|
|
|
|
Liabilities and
members' equity:
|
|
|
|
|
Total current portion
of long term debt
|
$
276
|
|
$
189
|
|
Total other current
liabilities
|
44,440
|
|
40,619
|
|
Total long term
debt
|
9,010
|
|
8,485
|
|
Total other long term
liabilities
|
4,612
|
|
539
|
|
Total members'
equity
|
785,964
|
|
737,411
|
|
|
Total liabilities and
members' equity
|
$ 844,302
|
|
$
787,243
|
Diamond Green
Diesel Joint Venture
|
Operating
Financial Results
|
Three Months Ended
March 31, 2019 and March 31, 2018
|
(in
thousands)
|
(unaudited)
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
$ Change
|
|
|
|
March 31,
|
|
March 31,
|
|
Favorable
|
Revenues:
|
2019
|
|
2018
|
|
(Unfavorable)
|
|
Operating
revenues
|
$ 302,718
|
|
$ 150,321
|
|
$
152,397
|
Expenses:
|
|
|
|
|
|
|
Total costs and
expenses less depreciation,
amortization and accretion expense
|
243,063
|
|
(49,821)
|
|
(292,884)
|
|
Depreciation,
amortization and accretion
expense
|
11,418
|
|
6,120
|
|
(5,298)
|
|
Total costs and
expenses
|
254,481
|
|
(43,701)
|
|
(298,182)
|
Operating
income
|
|
48,237
|
|
194,022
|
|
(145,785)
|
|
Other
income
|
641
|
|
377
|
|
264
|
|
Interest and debt
expense, net
|
(324)
|
|
-
|
|
(324)
|
Net
income
|
$
48,554
|
|
$ 194,399
|
|
$
(145,845)
|
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
|
First Quarter 2019 as
compared to First Quarter 2018
|
|
|
|
Three Months Ended -
Year over Year
|
Adjusted
EBITDA
|
March 30,
|
|
March 31,
|
(U.S. dollars in
thousands)
|
2019
|
|
2018
|
|
|
|
|
Net income
attributable to Darling
|
$
18,012
|
|
$
97,305
|
Depreciation and
amortization
|
79,164
|
|
78,619
|
Interest
expense
|
19,876
|
|
23,124
|
Income tax
expense
|
5,274
|
|
3,712
|
Foreign currency
loss
|
732
|
|
1,481
|
Other expense,
net
|
2,525
|
|
2,516
|
Equity in net income
of unconsolidated subsidiary
|
(23,773)
|
|
(97,154)
|
Net income
attributable to noncontrolling interests
|
1,628
|
|
770
|
|
Adjusted
EBITDA
|
$103,438
|
|
$110,373
|
Foreign currency
exchange impact (1)
|
6,056
|
|
-
|
Pro forma Adjusted
EBITDA to Foreign Currency (Non-GAAP)
|
$109,494
|
|
$110,373
|
|
|
|
|
|
|
|
|
|
|
DGD Joint Venture
Adjusted EBITDA (Darling's share)
|
$
29,828
|
|
$100,071
|
|
|
(1)
|
The average rates
assumption used in the calculation was the actual fiscal average
rate for the three months ended March 30, 2019 of
€1.00:USD$1.14 and CAD$1.00:USD$0.75 as compared to the average
rate for the three months ended March 31, 2018 of
€1.00:USD$1.23 and CAD$1.00:USD$0.80, respectively.
|
About Darling
Darling Ingredients Inc. is a global developer and producer of
sustainable natural ingredients from edible and inedible
bio-nutrients, creating a wide range of ingredients and customized
specialty solutions for customers in the pharmaceutical,
nutraceutical, food, pet food, feed, industrial, fuel, bioenergy
and fertilizer industries. With operations on five
continents, the Company collects and transforms all aspects of
animal by-product streams into useable and specialty ingredients,
such as gelatin, edible fats, feed-grade fats, animal proteins and
meals, plasma, pet food ingredients, organic fertilizers, yellow
grease, fuel feedstocks, green energy, natural casings and
hides. The Company also recovers and converts recycled oils
(used cooking oil and animal fats) into valuable feed and fuel
ingredients, and collects and processes residual bakery products
into feed ingredients. In addition, the Company provides
environmental services, such as grease trap collection and disposal
services to food service establishments and disposal services for
waste solids from the wastewater treatment systems of industrial
food processing plants. The Company sells its products domestically
and internationally and operates within three industry segments:
Feed Ingredients, Food Ingredients and Fuel Ingredients. For
additional information, visit the Company's website at
http://www.darlingii.com.
Darling Ingredients Inc. will host a conference call to discuss
the Company's first quarter 2019 financial results at 8:30
am Eastern Time (7:30 am Central
Time) on Thursday, May 9,
2019. 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
10130603. 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 May 16, 2019, by
dialing 1-877-344-7529 (U.S. callers), 855-669-9658 (Canada) and 1-412-317-0088 (international
callers). The access code for the replay is
10130603. 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 expenses, 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 and 5.375% Notes and 4.75% Notes that were outstanding
at March 30, 2019. 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 and 5.375% Notes and
4.75% 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 that
are subject to risks and uncertainties that could cause the actual
results of Darling Ingredients Inc. (the "Company") 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," "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. 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. 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 Unites 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 recent African Swine Fever ("ASF")
outbreak in China; 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 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,
including our ongoing enterprise resource planning project;
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 likely 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 presentation 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:
|
Melissa A. Gaither,
VP IR and Global Communications
|
Email :
mgaither@darlingii.com
|
251 O'Connor Ridge
Blvd., Suite 300, Irving, Texas 75038
|
Phone :
972-281-4478
|
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SOURCE Darling Ingredients Inc.