Darling Ingredients Inc. · NYSE:DAR
Darling Ingredients — Q4 2019 Earnings Presentation
18 slides from Darling Ingredients's earnings presentation, Feb 25, 2020
Slide 1: Fourth Quarter and Fiscal Year End 2019 Conference Call
EXHIBIT 99.2 Fourth Quarter and Fiscal Year End 2019 Conference Call
Slide 2: Forward-looking statements
This presentation 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
Slide 3: 2019 Highlights
US$ (millions) except per share price Q4-2018 Total 2018 Q1-2019 Q2-2019 Q3-2019 Q4-2019 Total 2019 2019 Highlights Net sales $ 853.1 $ 3,387.7 $ 835.1 $ 827.3 $ 842.0 $ 859.4 $ 3,363.9 Gross margin 185.4 741.3 184.1 182.6 189.1 219.0 774.8 • Record 2019 proforma operating income of $389.2 million,
Slide 4: Q4 2019 Overview
Q4 2019 Overview $250 Quarterly Proforma Combined Adjusted EBITDA, adjusting for timing of BTC earned $198.9 $200 $196.9 $192.7 • Net sales - $ 859.4 million $170.3 $179.8 • Net income - $ 242.6 million $88.0 $78.6 $150 $68.6 • EPS at $1.44 per diluted share $65.1 $99.1 • $100 Combined adjusted EBIT
Slide 5: Feed Segment
US$ (in millions) Q4-2018 Total 2018 Q1-2019 Q2-2019 Q3-2019 Q4-2019 Total 2019 Net Sales $ 485.3 $ 1,952.6 $ 495.8 $ 487.4 $ 497.0 $ 490.4 $ 1,970.6 Gross Margin 110.4 454.6 109.0 110.5 117.2 114.3 451.0 Gross Margin % 22.7% 23.2% 22.0% 22.7% 23.6% 23.3% 22.9% Adj. EBITDA Bridge Q4-2018 to Q4-2019
Slide 6: Food Segment
US$ (in millions) Q4-2018 Total 2018 Q1-2019 Q2-2019 Q3-2019 Q4-2019 Total 2019 Net Sales $ 291.7 $ 1,139.1 $ 279.2 $ 274.8 $ 276.5 $ 288.6 $ 1,119.1 Gross Margin 58.6 221.0 65.1 60.4 61.8 67.2 254.5 Gross Margin % 20.1% 19.4% 23.3% 22.0% 22.4% 23.3% 22.8% Loss/(gain) on sale of assets - (0.3) 0.1 (
Slide 7: Fuel Segment
(Includes Diamond Green Diesel JV consolidated EBITDA) US$ (in millions) Q4-2018 Total 2018 Q1-2019 Q2-2019 Q3-2019 Q4-2019 Total 2019 Net Sales $ 76.2 $ 296.0 $ 60.1 $ 65.0 $ 68.6 $ 80.6 $ 274.3 Key Drivers: Gross Margin 16.6 65.8 10.0 11.7 10.1 37.6 69.4 • Combined adjusted EBITDA of $311.2 millio
Slide 8: Diamond Green Diesel facilities and expansion
Existing 275 million gallon renewable diesel facility 400 million gallon expansion project Page 8 | Fourth Quarter and Fiscal Year 2019 Results | 02.26.2020
Slide 9: Balance Sheet Highlights and Debt Summary
(US$,Balance in thousands) Sheet HighlightsJune 30, 2018 Debt Summary S&P Ratings Cash(US$, in thousands) (includes restricted cashDecember of $142)28, 2019 (US$, in thousands) December 28, 2019 Cash (includes restricted cash$104,262 of $110) $ 73,045 Amended Credit Agreement Term Loan B – BBB- Corp
Slide 10: Appendix – Additional Information
Appendix – Additional Information Page 10 | Fourth Quarter and Fiscal Year 2019 Results | 02.26.2020
Slide 11: Average LCFS Carbon Credit Price
Average LCFS Carbon Credit Price Weighted Ave Price (USD/MT) $250 $200 $150 $100 $50 $- Jun-16 Jun-18 Jun-19 Jun-17 Oct-17 Oct-18 Oct-16 Oct-19 Apr-17 Apr-18 Apr-16 Apr-19 Feb-17 Feb-19 Feb-18 Dec-16 Dec-18 Dec-17 Dec-19 Aug-16 Aug-17 Aug-19 Aug-18 Source: https://ww3.arb.ca.gov/fuels/lcfs/credit/lr
Slide 12: Feed Segment Quarterly Results
US$ (in millions) Total 2017 Q1-2018 Q2-2018 Q3-2018 Q4-2018 Total 2018 Q1-2019 Q2-2019 Q3-2019 Q4-2019 Total 2019 Net Sales $ 2,239.5 $ 485.8 (1) $ 498.8 (1) $ 482.7 (1) $ 485.3 $ 1,952.6 $ 495.8 $ 487.4 $ 497.0 $ 490.4 $ 1,970.6 Gross Margin 494.5 116.3 128.8 99.0 110.4 454.6 109.0 110.5 117.2 114
Slide 13: 2019 Finished Product Pricing
Jacobsen, Wall Street Journal and Thomson Reuters 2019 Finished Product Pricing 2019 Average Jacobsen Prices (USD) Feed Segment Ingredients January February March Q1 Avg. April May June Q2 Avg. July August Sept. Q3 Avg. Oct. Nov. Dec. Q4 Avg. Year Avg. Bleachable Fancy Tallow - Chicago Renderer / cw
Slide 14: Food Segment Quarterly Results
US$ (in millions) Total 2017 Q1-2018 Q2-2018 Q3-2018 Q4-2018 Total 2018 Q1-2019 Q2-2019 Q3-2019 Q4-2019 Total 2019 Net Sales $ 1,157.0 (1) $305.5 (2) $ 276.7 (2) $ 265.2 (2) $ 291.7 (2) $ 1,139.1 $ 279.2 (2) $ 274.8 (2) $ 276.5 (2) $ 288.6 $ 1,119.1 Gross Margin 236.8 56.1 51.8 54.5 58.6 221.0 65.1
Slide 15: Fuel Segment Quarterly Results
US$ (in millions) Total 2017 Q1-2018 Q2-2018 Q3-2018 Q4-2018 Total 2018 Q1-2019 Q2-2019 Q3-2019 Q4-2019 Total 2019 Net Sales $ 265.8 $ 84.1 $ 71.1 $ 64.6 $ 76.2 $ 296.0 $ 60.1 $ 65.0 $ 68.6 $ 80.6 $ 274.3 Gross Margin 55.3 24.3 13.7 11.2 16.6 65.8 10.0 11.7 10.1 37.6 69.4 Gross Margin % 20.8% 28.9%
Slide 16: Adjusted EBITDA definition
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. Adjust
Slide 17: Adjusted EBITDA and Pro Forma Adjusted EBITDA
Adjusted EBITDA and Pro Forma Adjusted EBITDA Three Months Ended Twelve Months Ended - Year over Year (US$ in thousands) December 28, December 29, December 28, December 29, 2019 2018 2019 2018 Net income attributable to Darling $ 242,609 $ 40,648 $ 312,600 $ 101,496 Depreciation and amortization 86,
Slide 18: Thank you
DARLING INGREDIENTS INC. Thank you