PR Newswire | Aug 10, 2021 04:15PM EDT

08/10 15:15 CDT

Darling Ingredients Inc. Reports Second Quarter 2021 Financial Results IRVING, Texas, Aug 10, 2021

IRVING, Texas, Aug 10, 2021 /PRNewswire/ -- Darling Ingredients Inc. (NYSE: DAR, "Darling") --

Second Quarter 2021

* Net income of $196.6 million, or $1.17 per GAAP diluted share * Net Sales of $1.2 billion * Combined adjusted EBITDA of $353.7 million * Global Ingredients business reported a record Q2 EBITDA of $221.7 million * Renewable diesel JV, DGD generated a record quarter, contributing $132.0 million of EBITDA to Darling * Darling repurchased approximately $76 million of common stock in the second quarter * Darling trailing twelve-month combined adjusted EBITDA surpasses $1 billion, first time in company history * DGD Norco, LA 400 million gallon renewable diesel project on track to be fully operational in middle of Q4 2021 * DGD Port Arthur, TX 470 million gallon renewable diesel project expected completion now in first half of 2023

Darling reported net sales of $1.2 billion for the second quarter of 2021, as compared with net sales of $848.7 million for the same period a year ago. Net income attributable to Darling for the three months ended July 3, 2021 was $196.6 million, or $1.17 per diluted share, compared to net income of $65.4 million, or $0.39 per diluted share, for the second quarter of 2020.

"Our global ingredients business continues to perform at the highest levels producing a record adjusted EBITDA of approximately $222 million for the second quarter," said Randall C. Stuewe, Chairman and Chief Executive Officer of Darling Ingredients Inc. "We continue to see positive signs of strength in a recovering economy both here in North America and around the world which should provide for sustained demand for food, feed and fuel, empowering Darling to take advantage of our leadership position in the industry."

"Darling's 2021 first half financial performance was strong, as we generated a combined adjusted EBITDA of $638.5 million and with the continued strength of commodity pricing for our global ingredients business expected through the rest of 2021, and the 400 million gallon renewable diesel expansion of DGD Norco, LA starting up in the near term, we are once again increasing our combined adjusted EBITDA guidance for 2021 to approximately $1.275 billion," commented Stuewe.

Under Darling's current share repurchase authorization, the Company repurchased 1.14 million shares of common stock during the second quarter for a total of $75.7 million. Darling has approximately $124.3 million remaining under its current authorization.

For the six months ended July 3, 2021, Darling reported net sales of $2.25 billion, as compared with net sales of $1.7 billion for the same period of 2020. Net Income attributable to Darling for the first six months of 2021 was $348.3 million, or $2.08 per diluted share, as compared to a net income of $150.9 million, or $0.90 per diluted share, for the first six months of 2020.

As of July 3, 2021, Darling had $77.9 million in cash and cash equivalents, and $902.1 million available under its committed revolving credit agreement. Total debt outstanding as of July 3, 2021 was $1.4 billion. Capital expenditures (exclusive of DGD investments) of $126.1 million were made during the first six months of fiscal 2021, compared to $123.2 million in the first six months of fiscal 2020.

Combined adjusted EBITDA was $353.7 million for the second quarter of 2021, compared to $195.2 million for the same period in 2020. On a year-to-date basis, combined adjusted EBITDA totaled $638.5 million for 2021, compared to $408.5 million on a year-to-date basis for 2020.

Segment Financial Tables (in thousands)

(unaudited)

Three Months Ended July 3, 2021 Feed Food Fuel Corporate Total Ingredients Ingredients Ingredients

Net Sales $ 771,932 $ 317,031 $ 109,706 $ - $ 1,198,669

Cost of sales and operating expenses 556,424 238,539 83,110 - 878,073

Gross Margin $ 215,508 $ 78,492 $ 26,596 $ - $ 320,596

Gain on sale of assets (122) (48) (58) - (228)

Selling, general and administrative expenses 54,977 25,542 4,474 14,139 99,132

Depreciation and amortization 53,971 15,850 6,698 2,703 79,222

Equity in net income of Diamond Green Diesel - - 125,788 - 125,788

Segment operating income/(loss) $ 106,682 $ 37,148 $ 141,270 $ (16,842) $ 268,258

Equity in net income of other unconsolidated subsidiaries $ 1,940 $ - $ - $ - $ 1,940

Segment Income/(loss) $ 108,622 $ 37,148 $ 141,270 $ (16,842) $ 270,198

Segment EBITDA $ 160,653 $ 52,998 $ 22,180 $ (14,139) $ 221,692

DGD adjusted EBITDA (Darling's Share) $ - $ - $ 132,001 $ - $ 132,001

Combined adjusted EBITDA $ 160,653 $ 52,998 $ 154,181 $ (14,139) $ 353,693

Three Months Ended June 27, 2020 Feed Food Fuel Corporate Total Ingredients Ingredients Ingredients

Net Sales $ 503,690 $ 278,934 $ 66,049 $ - $ 848,673

Cost of sales and operating expenses 367,902 220,159 44,286 - 632,347

Gross Margin $ 135,788 $ 58,775 $ 21,763 $ - $ 216,326

Loss/(gain) on sale of assets 76 (48) (1) - 27

Selling, general and administrative expenses 50,484 22,564 3,953 13,192 90,193

Depreciation and amortization 52,683 19,972 7,980 2,675 83,310

Equity in net income of Diamond Green Diesel - - 63,492 - 63,492

Segment operating income/(loss) $ 32,545 $ 16,287 $ 73,323 $ (15,867) $ 106,288

Equity in net income of other unconsolidated subsidiaries $ 692 $ - $ - $ - $ 692

Segment income/(loss) $ 33,237 $ 16,287 $ 73,323 $ (15,867) $ 106,980

Segment EBITDA $ 85,228 $ 36,259 $ 17,811 $ (13,192) $ 126,106

DGD adjusted EBITDA (Darling's Share) $ - $ - $ 69,108 $ - $ 69,108

Combined adjusted EBITDA $ 85,228 $ 36,259 $ 86,919 $ (13,192) $ 195,214

Six Months Ended July 3, 2021 Feed Food Fuel Corporate Total Ingredients Ingredients Ingredients

Net Sales $ 1,423,376 $ 615,096 $ 206,913 $ - $ 2,245,385

Cost of sales and operating expenses 1,031,005 464,952 154,900 - 1,650,857

Gross Margin $ 392,371 $ 150,144 $ 52,013 $ - $ 594,528

Loss/(gain) on sale of assets (261) 7 (38) - (292)

Selling, general and administrative expenses 107,597 50,733 9,341 28,859 196,530

Restructuring and asset impairment charges - - 778 - 778

Depreciation and amortization 108,580 30,733 12,853 5,590 157,756

Equity in net income of Diamond Green Diesel - - 228,013 - 228,013

Segment operating income/(loss) $ 176,455 $ 68,671 $ 257,092 $ (34,449) $ 467,769

Equity in net income of other unconsolidated subsidiaries $ 2,552 $ - $ - $ - $ 2,552

Segment income/(loss) $ 179,007 $ 68,671 $ 257,092 $ (34,449) $ 470,321

Segment EBITDA $ 285,035 $ 99,404 $ 42,710 $ (28,859) $ 398,290

DGD adjusted EBITDA (Darling's Share) $ - $ - $ 240,201 $ - $ 240,201

Combined adjusted EBITDA $ 285,035 $ 99,404 $ 282,911 $ (28,859) $ 638,491

Six Months Ended June 27, 2020 Feed Food Fuel Corporate Total Ingredients Ingredients Ingredients

Net Sales $ 1,016,315 $ 549,228 $ 135,972 $ - $ 1,701,515

Cost of sales and operating expenses 756,355 425,589 97,311 - 1,279,255

Gross Margin $ 259,960 $ 123,639 $ 38,661 $ - $ 422,260

Loss/(gain) on sale of assets 126 (46) 8 - 88

Selling, general and administrative expenses 104,431 48,040 5,607 28,308 186,386

Depreciation and amortization 106,204 40,277 16,072 5,428 167,981

Equity in net income of Diamond Green Diesel - - 161,312 - 161,312

Segment operating income/(loss) $ 49,199 $ 35,368 $ 178,286 $ (33,736) $ 229,117

Equity in net income of other unconsolidated subsidiaries $ 1,561 $ - $ - $ - $ 1,561

Segment income/(loss) $ 50,760 $ 35,368 $ 178,286 $ (33,736) $ 230,678

Segment EBITDA $ 155,403 $ 75,645 $ 33,046 $ (28,308) $ 235,786

DGD adjusted EBITDA (Darling's Share) $ - $ - $ 172,742 $ - 172,742

Combined adjusted EBITDA $ 155,403 $ 75,645 $ 205,788 $ (28,308) $ 408,528

Darling Ingredients Inc. and SubsidiariesConsolidated Balance SheetsJuly 3, 2021 and January 2, 2021(in thousands)

July 3, January 2,

2021 2021

ASSETS (unaudited)

Current assets:

Cash and cash equivalents $ 77,741 $ 81,617

Restricted cash 177 103

Accounts receivable, net 433,441 405,387

Inventories 428,203 405,922

Prepaid expenses 58,648 47,793

Income taxes refundable 2,636 3,883

Other current assets 21,734 42,289

Total current assets 1,022,580 986,994

Property, plant and equipment, net 1,846,814 1,863,814

Intangible assets, net 439,035 473,680

Goodwill 1,245,549 1,260,240

Investment in unconsolidated 1,037,436 804,682subsidiaries

Operating lease right-of-use 165,034 146,563assets

Other assets 61,000 60,682

Deferred income taxes 15,875 16,676

$ 5,833,323 $ 5,613,331

LIABILITIES AND STOCKHOLDERS'EQUITY

Current liabilities:

Current portion of long-term debt $ 41,603 $ 27,538

Accounts payable, principally 264,447 255,340 trade

Income taxes payable 25,096 17,497

Current operating lease 40,228 39,459 liabilities

Accrued expenses 320,838 335,471

Total current liabilities 692,212 675,305

Long-term debt, net of current 1,393,798 1,480,531portion

Long-term operating lease 126,527 109,707liabilities

Other noncurrent liabilities 115,510 117,371

Deferred income taxes 321,466 276,208

Total liabilities 2,649,513 2,659,122

Commitments and contingencies

Total Darling's stockholders' 3,118,576 2,891,909equity

Noncontrolling interests 65,234 62,300

Total stockholders' equity $ 3,183,810 $ 2,954,209

$ 5,833,323 $ 5,613,331

Darling Ingredients Inc. and SubsidiariesConsolidated Operating ResultsFor the Three-Month and Six-Month Periods Ended July 3, 2021 and June 27, 2020(in thousands, except per share data)

Three Months Ended Six Months Ended

(unaudited) $ Change (unaudited) $ Change

July 3, June 27, Favorable July 3, June 27, Favorable

2021 2020 (Unfavorable) 2021 2020 (Unfavorable)

Net sales $ 1,198,669 $ 848,673 $ 349,996 $ 2,245,385 $ 1,701,515 $ 543,870

Costs and expenses:

Cost of sales and operating expenses 878,073 632,347 (245,726) 1,650,857 1,279,255 (371,602)

Loss (gain) on sale of assets (228) 27 255 (292) 88 380

Selling, general and administrative expenses 99,132 90,193 (8,939) 196,530 186,386 (10,144)

Restructuring and asset impairment charges - - - 778 - (778)

Depreciation and amortization 79,222 83,310 4,088 157,756 167,981 10,225

Total costs and expenses 1,056,199 805,877 (250,322) 2,005,629 1,633,710 (371,919)

Equity in net income of Diamond Green Diesel 125,788 63,492 62,296 228,013 161,312 66,701

Operating income 268,258 106,288 161,970 467,769 229,117 238,652

Other expense:

Interest expense (15,268) (17,920) 2,652 (31,696) (37,010) 5,314

Foreign currency gain / (loss) (684) (1,134) 450 (1,094) 530 (1,624)

Other expense, net (1,198) (1,485) 287 (2,357) (3,366) 1,009

Total other expense (17,150) (20,539) 3,389 (35,147) (39,846) 4,699

Equity in net income

of other unconsolidated subsidiaries 1,940 692 1,248 2,552 1,561 991

Income from operations before income taxes 253,048 86,441 166,607 435,174 190,832 244,342

Income tax expense 54,979 19,946 (35,033) 83,687 38,246 (45,441)

Net income 198,069 66,495 131,574 351,487 152,586 198,901

Net income attributable to

noncontrolling interests (1,487) (1,056) (431) (3,139) (1,637) (1,502)

Net income attributable to Darling $ 196,582 $ 65,439 $ 131,143 $ 348,348 $ 150,949 $ 197,399

Basic income per share: $ 1.21 $ 0.40 $ 0.81 $ $ 0.93 $ 1.21 2.14

Diluted income per share: $ 1.17 $ 0.39 $ 0.78 $ $ 0.90 $ 1.18 2.08

Number of diluted common shares: 167,597 165,999 167,673 166,963

Darling Ingredients Inc. and SubsidiariesConsolidated Statement of Cash FlowsPeriods Ended July 3, 2021 and June 27, 2020(in thousands)(unaudited)

Six Months Ended

July 3, June 27,

Cash flows from operating activities: 2021 2020

Net income $ 351,487 $ 152,586

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization 157,756 167,981

Loss/(gain) on sale of assets (292) 88

Asset 138 - impairment

Deferred 49,572 13,998 taxes

Decrease in long-term pension liability (622) (890)

Stock-based compensation expense 14,011 15,566

Write-off deferred loan costs 598 -

Deferred loan cost amortization 2,047 2,835

Equity in net income of Diamond Green Diesel and (230,565) (162,873) other unconsolidated subsidiaries

Distributions of earnings from Diamond Green Diesel 2,497 125,891 and other unconsolidated subsidiaries

Changes in operating assets and liabilities, net of effects from acquisitions:

Accounts receivable (34,911) 26,077

Income taxes refundable/payable 9,116 6,119

Inventories and prepaid expenses (39,992) (35,413)

Accounts payable and accrued expenses 2,770 (33,375)

Other 14,327 (14,941)

Net cash provided by operating activities 297,937 263,649

Cash flows from investing activities:

Capital expenditures (126,094) (123,204)

Acquisitions, net of cash acquired (2,059) -

Investment in unconsolidated subsidiaries (4,449) -

Gross proceeds from disposal of property, plant and 3,064 1,053 equipment and other assets

Payments related to routes and other intangibles (347) (3,712)

Net cash used by investing activities (129,885) (125,863)

Cash flows from financing activities:

Proceeds from long-term debt 20,679 16,164

Payments on long-term debt (73,393) (18,239)

Borrowings from revolving credit facility 207,000 375,971

Payments on revolving credit facility (220,000) (405,800)

Net cash overdraft financing 16,487 (26,461)

Issuance of common stock 50 67

Repurchase of common stock (75,663) (55,044)

Minimum withholding taxes paid on stock awards (43,853) (4,863)

Acquisition of noncontrolling interest - (8,784)

Distributions to noncontrolling interests (2,164) (987)

Net cash used by financing activities (170,857) (127,976)

Effect of exchange rate changes on cash flows (997) (6,567)

Net increase / (decrease) in cash, cash equivalents (3,802) 3,243and restricted cash

Cash, cash equivalents and restricted cash at 81,720 73,045beginning of period

Cash, cash equivalents and restricted cash at end of $ 77,918 $ 76,288period

Supplemental disclosure of cash flow information:

Accrued capital expenditures $ 1,101 $ 23

Cash paid during the period for:

Interest, net of capitalized interest $ 29,928 $ 35,070

Income taxes, net of refunds $ 25,270 $ 18,030

Non-cash operating activities:

Operating lease right of use obtained in exchange $ 44,218 $ 28,801 for new lease liabilities

Non-cash financing activities:

Debt issued for service contract assets $ 60 $ 21

Diamond Green Diesel Joint VentureCondensed Consolidated Balance SheetsJune 30, 2021 and December 31, 2020(in thousands)

June 30, December 31,

2021 2020

Assets: (unaudited)

Total current assets $ 464,631 $ 383,557

Property, plant and equipment, net 1,727,979 1,238,726

Other assets 35,369 36,082

Total assets $ 2,227,979 $ 1,658,365

Liabilities and members' equity:

Total current portion of long term debt $ 581 $ 517

Total other current liabilities 205,484 99,787

Total long term debt 8,635 8,705

Total other long term liabilities 8,555 3,758

Total members' equity 2,004,724 1,545,598

Total liabilities and members' equity $ 2,227,979 $ 1,658,365

Diamond Green Diesel Joint VentureOperating Financial ResultsFor the Three-Month and Six-Month Periods Ended June 30, 2021 and June 30, 2020(in thousands)

Three Months Ended Six Months Ended

(unaudited) $ Change (unaudited) $ Change

June 30, June 30, Favorable June 30, June 30, Favorable

Revenues: 2021 2020 (Unfavorable) 2021 2020 (Unfavorable)

Operating revenues $ 571,859 $ 295,826 $ 276,033 $ 1,003,492 $ 654,441 $ 349,051

Expenses:

Total costs and expenses less

depreciation, amortization and 307,857 157,611 (150,246) 523,091 308,958 (214,133) accretion expense

Depreciation, amortization and 11,995 11,114 (881) 23,682 22,888 (794)

accretion expense

Total costs and expenses 319,852 168,725 (151,127) 546,773 331,846 (214,927)

Operating income 252,007 127,101 124,906 456,719 322,595 134,124

Other income 353 200 153 411 661 (250)

Interest and debt expense, net (784) (317) (467) (1,104) (632) (472)

Net income $ 251,576 $ 126,984 $ 124,592 $ 456,026 $ 322,624 $ 133,402

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) Proforma Adjusted EBITDA

For the Three-Month and Six-Month Periods Ended July 3, 2021 and June 27, 2020

Three Months Ended Six Months Ended

Adjusted EBITDA July 3, June 27, July 3, June 27,

(U.S. dollars in thousands) 2021 2020 2021 2020

Net income attributable to Darling $ 196,582 $ 65,439 $ 348,348 $ 150,949

Depreciation and amortization 79,222 83,310 157,756 167,981

Interest expense 15,268 17,920 31,696 37,010

Income tax expense 54,979 19,946 83,687 38,246

Restructuring and asset impairment charges - - 778 -

Foreign currency loss / (gain) 684 1,134 1,094 (530)

Other expense, net 1,198 1,485 2,357 3,366

Equity in net income of Diamond Green Diesel (125,788) (63,492) (228,013) (161,312)

Equity in net income of other unconsolidated subsidiaries (1,940) (692) (2,552) (1,561)

Net income attributable to noncontrolling interests 1,487 1,056 3,139 1,637

Adjusted EBITDA (Non-GAAP) $ 221,692 $ 126,106 $ 398,290 $ 235,786

Foreign currency exchange impact (11,493) (1) - (19,542) (2) -

Pro forma Adjusted EBITDA to Foreign Currency (Non-GAAP) $ 210,199 $ 126,106 $ 378,748 $ 235,786

DGD Joint Venture Adjusted EBITDA (Darling's Share) $ 132,001 $ 69,108 $ 240,201 $ 172,742

Darling plus Darling's share of DGD Joint Venture Adjusted $ 353,693 $ 195,214 $ 638,491 $ 408,528EBITDA

(1) The average rate assumption used in this calculation was the actualfiscal average rate for the three months ended July 3, 2021 of (eu)1.00:USD$1.21 and CAD$1.00:USD$0.81, as compared to the average rate for thethree months ended June 27, 2020 of (eu)1.00:USD$1.10 andCAD$1.00:USD$0.72, respectively.

(2) The average rate assumption used in this calculation was the actualfiscal average rate for the six months ended July 3, 2021 of (eu)1.00:USD$1.20 and CAD$1.00:USD$0.80, as compared to the average rate for thesix months ended June 27, 2020 of (eu)1.00:USD$1.10 and CAD$1.00:USD$0.73,respectively.

About Darling

Darling Ingredients Inc. (NYSE: DAR) is a world leading producer of organic ingredients, generating 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. Darling Ingredients named one of the 50 Sustainability and Climate Leaders in 2021, to learn more Darling Ingredients: The greenest Company on the planet - 50 Sustainability & Climate Leaders (50climateleaders.com). The Company sells its ingredients 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 venture partner in Diamond Green Diesel (DGD), North America's largest renewable diesel manufacturer, currently producing approximately 290 million gallons of renewable diesel annually which products reduce Greenhouse Gas (GHG) emissions by up to 85% compared to fossil fuels. 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 second quarter 2021 financial results at 9:00 am Eastern Time (8:00 am Central Time) on Wednesday, August 11, 2021. 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 10158835. 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 August 18, 2021, 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 10158835. 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.

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).

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 July 3, 2021. 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.

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 income and statement of cash flow, 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 a range 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.

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," "combined adjusted EBITDA guidance" 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 projects; 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 Email :Relations james.stark@darlingii.com

5601 MacArthur Blvd., Irving, Texas 75038 Phone : 972-281-4823

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SOURCE Darling Ingredients Inc.