PR Newswire | Nov 3, 2020 04:07PM EST

11/03 15:07 CST

Darling Ingredients Inc. Reports Third Quarter 2020 Financial Results IRVING, Texas, Nov. 3, 2020

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 Food Fuel Corporate Total Ingredients Ingredients Ingredients

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 Food Fuel Corporate Total Ingredients Ingredients Ingredients

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 Food Fuel Corporate Total Ingredients Ingredients Ingredients

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 Food Fuel Corporate Total Ingredients Ingredients Ingredients

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 SubsidiariesCondensed Consolidated Balance SheetsSeptember 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 SubsidiariesConsolidated Operating ResultsFor the Three-Month and Nine-Month Periods Ended September 26, 2020 andSeptember 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 SubsidiariesConsolidated Statement of Cash FlowsPeriods 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 (254,878) (93,303) subsidiaries

Distributions of earnings from Diamond Green Diesel and other unconsolidated 207,165 57,118 subsidiaries

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 VentureCondensed Consolidated Balance SheetsSeptember 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 VentureOperating Financial ResultsFor the Three-Month and Nine-Month Periods Ended September 30, 2020 andSeptember 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 153,406 183,022 29,616 462,364 633,109 170,745 accretion expense

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 EBITDAFor 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 fiscalaverage rate for the three months ended

September 26, 2020 of (eu)1.00:USD$1.17 and CAD$1.00:USD$0.75, as compared tothe average rate for the three months ended

September 28, 2019 of (eu)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 fiscalaverage rate for the nine months ended

September 26, 2020 of (eu)1.00:USD$1.12 and CAD$1.00:USD$0.74, as compared tothe average rate for the nine months ended

September 28, 2019 of (eu)1.00:USD$1.12 and CAD$1.00:USD$0.75, respectively.

About DarlingDarling 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.com5601 MacArthur Blvd., Irving, Texas 75038 Phone : 972-281-4823

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SOURCE Darling Ingredients Inc.