Darling Ingredients Inc. · NYSE:DAR
Darling Ingredients — Darling International — J.P. Morgan Global High Yield & Leverage Finance Conference 2014
39 slides from Darling Ingredients's conference presentation, Feb 25, 2014
Slide 1: J.P. Morgan Global High Yield & Leverage Finance Conference
Exhibit 99.1 J.P. Morgan Global High Yield & Leverage Finance Conference February 25, 2014 Creating sustainable food, feed and fuel ingredients for a growing population 1
Slide 2: Table of Contents
Table of Contents 1. Company Profile 4 2. New Business Segments 12 3. Growth Strategy 23 4. Financial Review 32 2
Slide 3: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements regarding the business operations and prospects of Darling International and industry factors affecting it. These statements are identified by words such as “may,” “will,” “begin,” “look forward,” “expect,” “believe,” “inten
Slide 4: Company Profile: From Then to Now
Company Profile Business Segments Growth Strategy Financial Review Company Profile From Then to Now 4
Slide 5: From... January 2013
Company Profile Business Segments Growth Strategy Financial Review January 2013 From... The oldest, largest and most innovative recycling solutions company serving the nation’s food industry... • 120 operating facilities across U.S. • Approx. 4,000 employees • Over $1.7 billion in revenues 5
Slide 6: To... January 2014
Company Profile Business Segments Growth Strategy Financial Review To... January 2014 A global growth platform for the development and production of sustainable natural ingredients from edible and inedible bio-nutrients, creating a wide range of products and customized specialty solutions • Over 200
Slide 7: The Evolution of Darling International
Company Profile Business Segments Growth Strategy Financial Review The Evolution of Darling International COMMODITY BUSINESS Pre 2004 Mixed meat renderer with good used cooking oil business (particularly east/west coasts) GREW EXISTING BUSINESS ADDING PRODUCT DIVERSIFICATION; NBP & Griffin INITIAL M
Slide 8: A World Leader in Bio-Nutrient Transformation
A World Leader in Bio-Nutrient Transformation Improvement by Nature Global footprint: 5 continents • Gelatin • Casings Production facilities: Over 200 • Functional Proteins Founded: 1882 Food • Food Grade Fats Listed: 1994 • Heparin Publicly traded: NYSE: DAR • Proteins Fats • Principal segments: Th
Slide 9: A World Leader in Bio-Nutrient Transformation
Company Profile Business Segments Growth Strategy Financial Review A World Leader in Bio-Nutrient Transformation Improvementby Nature Over 200 operations on 5 continents Over 400 products sold worldwide 9
Slide 10: Year of Tremendous Growth, Uniquely Diversified
Company Profile Business Segments Growth Strategy Financial Review Year of Tremendous Growth Uniquely Diversified LTM Sept. 2013 Revenue USA Pro forma LTM Sept. 2013 Revenue Bakery Fuel Does not include pro forma DGD 17% 8% revenue Food Shown with new 29% Rendering acquisitions by our 83% new busine
Slide 11: Highly Experienced and International Executive Team
Company Profile Business Segments Growth Strategy Financial Review Highly Experienced and International Executive Team Continues to explore growth and value creation opportunities • Entrepreneurship • Transparency Randall C. Stuewe • Integrity Chairman & CEO Darling International Colin T. Stevenson
Slide 12: Food, Feed & Fuel: Our New Business Segments
Company Profile Business Segments Growth Strategy Financial Review Food, Feed & Fuel Our New Business Segments 12
Slide 13: Unique Diversified Portfolio
Company Profile Business Segments Growth Strategy Financial Review Unique Diversified Portfolio Provides broad stabilized market exposure worldwide Food Feed Fuel Specialty Fuel Generated thru Pharma Food products General products products DGD production Peptan® Natural Bone China Proteins Leather R
Slide 14: Research and Development
Research and Development Research and development are at our Company’s strategic core to achieve product leadership by creating the highest value-add for its raw material and end products strongrelationshipswith our customersby co-developmentof specificproductsfor their endmarkets Efforts focus on p
Slide 15: Our Food Ingredients
Our Food Ingredients Ingredients for living. Darling’s food ingredients are sold to a worldwide market that includes the pharmaceutical,food and cosmeticindustries. Rousselotis the world’s leading supplier of gelatin and collagen peptides to the food and pharmaceuticalindustries. Peptan®collagenpept
Slide 16: Adding Value in the Food Segment
Company Profile Business Segments Growth Strategy Financial Review Adding Value in the Food Segment Source Raw Material Activities Products • Pig skin F • ish skin • Gelatin • Bovine hides/bones • Hydrolysates • Porcine bone • Collagen peptides • Fat • Food grade fats • Schmalz • Bowel packages • Na
Slide 17: Our Feed Ingredients
Our Food Ingredients Nutrients for growth. Our feed ingredients compose the largest segment of our business, with sales to feed and pet food manufacturers worldwide or used to produce our own fertilizers. The Company’s DAR PRO Solutions, Rothsay and Sonacbrands collect and transform meat and animal
Slide 18: Adding Value in the Feed Segment
Company Profile Business Segments Growth Strategy Financial Review Adding Value in the Feed Segment Source Raw Material Activities Products • Bones •Fat • Fats, protein meals, tallow • Blood •Hair • Fertilizer Prepared • hides • Mucosa •Hides • Bone ash, glue, chips • Soft byproducts • Pet food • De
Slide 19: Our Fuel Ingredients
Our Fuel Ingredients Energy for today’s world. For the past two decades, Darling has led the way in biofuel innovation anddevelopment.DiamondGreenDiesel1, a partnershipwith Valero EnergyCorp.,is the Company’smost innovativeandlargest-scaleeffort to meet the growing demand for renewable energy. Locat
Slide 20: Adding Value in the Fuel Segment
Company Profile Business Segments Growth Strategy Financial Review Adding Value in the Fuel Segment Source Raw Material Activities Products • Organic Sludges C1• Fat • Refined fats Green • gas • Drain fat •Manure • Green electricity • Catering remains • Biophosphate • Fallen stock • Fats & meals for
Slide 21: Leader in Biofuel Innovation
Company Profile Business Segments Growth Strategy Financial Review Leader in Biofuel Innovation Pioneering in 1998 Began the first continuous- First in Canada- 2001 running bio-diesel plant in Innovating in 2013 The first commercial facility in Canada, – Startup of the U.S. utilizing used located ne
Slide 22: What is Diamond Green Diesel?
Company Profile Business Segments Growth Strategy Financial Review What is Diamond Green Diesel? $445 millionjoint venturebetween ValeroEnergy Corporationand DarlingInternationalto fulfill nearly 15% of the national biomass-based diesel mandate (under RFS2) Most economical feedstock available – 1.13
Slide 23: Growth Strategy
Company Profile Business Segments Growth Strategy Financial Review Growth Strategy How We Will Grow and Sustain Our Business 23
Slide 24: Our growth is a response to our growing world
Our growth is a response to our growing world Strong growth in world population... ...and more wealth created in key growth areas (Asia and Latin America)... ...exponentially increases the demand for food, feed and fuel... thus increasing the need for our innovative ingredients and customized servic
Slide 25: Darling's growth strategy is centered on…
Company Profile Business Segments Growth Strategy Financial Review Darling’s growth strategy is centered on… Strengthen Current PositionCapture Growth Opportunities • Operational excellence: • Greenfield:Expand our operation facilities in new - Optimizing integration of global supply chains growing
Slide 26: Success
Company Profile Business Segments Growth Strategy Financial Review How we accomplish our growth goals… Success is consistently providing maximum value to the supply chain Creating sustainable food, feed and fuel ingredients for a growing population 26
Slide 27: Capture Growth Opportunities: North America
Capture Growth Opportunities North America Sonac –Upper Midwest • Expansion of blood plants in US/Canada • Grow hemoglobin/plasma business Rothsay –Canada • Grow the used cooking oil/ restaurant services and Terra Renewal Services • Optimize finished product margins • Potential investment in new bon
Slide 28: Capture Growth Opportunities: North America
Company Profile Business Segments Growth Strategy Financial Review Capture Growth Opportunities North America Combine Synergies: • Solid and semi-solid residuals from Terra’s processing will be further refined Hexane Extraction through our Hexane extraction processTerra Renewal Currently operating o
Slide 29: Capture Growth Opportunities: South America
Capture Growth Opportunities South America Sonac • Explore animal by-product processing RousselotBrazil - opportunities • Continue to expand gelatin • Grow the Peptan®brand 29
Slide 30: Capture Growth Opportunities: Europe
Capture Growth Opportunities Europe Ecoson Son, - Netherlands • Expand biophosphate production Sonac • Capture animal by-product processing opportunities in South and East Europe 30
Slide 31: Growth Opportunities: China
Growth Opportunities China RousselotChina - • Gelatin expansion Sonac C- hina • Blood expansion • Explore animal by-product processing opportunities 31
Slide 32: Financials
Company Profile Business Segments Growth Strategy Financial Review Financials 32
Slide 33: Historical Darling Operating Performance
Historical Darling Operating Performance Net Sales ($ millions) Adjusted EBITDA ($ millions) $1,797 $1,701 $1,720 $393 $317 $290 2011 2012 LTM Sep-13 2011 2012 LTM Sep-13 Capital Expenditures ($ millions) AdjustedEBITDA– CapitalExpenditures ($ millions) $115 $117 $333 $60 $202 $173 2011 2012 LTM Sep
Slide 34: Historical Rothsay and VION Operating Performance
Company Profile Business Segments Growth Strategy Financial Review Historical Rothsay and VION Operating Performance Rothsay ($ in millions) VION ($ in millions) $2,185 $2,088 Net $227 $236 Revenue 2012 LTM Sep-13 2012 LTM Sep-13 $251 $265 Operating $87 $85 Income plus D&A 2012 LTM Sep-13 2012 LTM S
Slide 35: Pro Forma Operating Performance
Company Profile Business Segments Growth Strategy Financial Review Pro Forma Operating Performance Net Sales ($ in millions) Pro Forma Adjusted EBITDA ($ in millions) Darling VION Rothsay $653 $647 4500 $4,017 $4,141 4000 236 227 3500 3000 2088 2185 2500 2000 1500 1000 1701 1720 500 0 2012 LTM Sept.
Slide 36: Appendix
Company Profile Business Segments Growth Strategy Financial Review Appendix 36
Slide 37: Reconciliation of Non-GAAP Items
Company Profile Business Segments Growth Strategy Financial Review Reconciliation of Non-GAAP Items Darling (mm in USD) Annual Nine Months Ended September LTM 2011 2012 2012 2013 Sep-2013 Net Sales $ 1,797 $ 1,701 $ 1,277 $ 1,295 $ 1,720 Adjusted EBITDA $ 393 $ 317 $ 245 $ 218 $ 290 Capital Expendit
Slide 38: Adjusted EBITDA Reconciliation
Company Profile Business Segments Growth Strategy Financial Review Adjusted EBITDA Reconciliation Historical Adjusted EBITDA Reconciliation Pro Forma Adjusted EBITDA 1 ($ millions) Reconciliation ($ millions) Darling Darling Darling Darling Darling Darling Darling Darling Pro Forma Combined Pro Form
Slide 39: Creating sustainable food, feed and fuel ingredients for a growing population
Creating sustainable food, feed and fuel ingredients for a growing population 39
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