DAR Filings — Darling Ingredients Inc. - FilingSpy
DAR
Darling Ingredients Inc.
A maker of sustainable ingredients, Darling collects animal by-products, used cooking oil, and bakery leftovers from slaughterhouses, restaurants, and bakeries, turning them into proteins and fats for animal feed and pet food, collagen and casings for food and pharma, and renewable diesel through its Diamond Green Diesel venture with Valero. Founded in Chicago in 1882 by Ira C. Darling to serve the meatpacking industry, it has been called the "original recycler" for repurposing what would otherwise go to waste, and its Rousselot brand makes collagen peptides used in supplements and beauty products.
Diamond Green Diesel equity income swung $350M year over year, driving a 632% increase in operating income.
Diamond Green Diesel turned from a loss to a large gain, transforming the quarter. rose 16.4% to $1.72 billion and widened 5.8 points to 29.2% as the Fuel swung to a $366.8 million and Feed Ingredients margins expanded on higher fat and protein prices. The joint venture's recovery has restored earnings power, but the result was amplified by one-time tariff recoveries.
Key takeaways
Fuel Ingredients swung to $366.8 million from $15.9 million a year ago, driven by a $350.0 million swing in Diamond Green Diesel — from a $16.0 million loss to a $334.0 million gain — on higher production, RIN values, and diesel prices.
Feed Ingredients rose 277.7% to $150.7 million as higher fat and protein prices lifted to 27.8% from 22.9%, more than offsetting higher SG&A and .
Section summaries
Management's Discussion and Analysis
Q2 FY2026 segment operating income surged 631.5% to $555.2M, driven by higher fat/protein prices, DGD equity income, and tariff recoveries.
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Total rose to $555.2M from $75.9M, with Fuel Ingredients contributing $366.8M (up from $15.9M) due to a $350.0M equity income swing at the DGD Joint Venture.
Feed Ingredients grew 277.7% to $150.7M, as higher fat and protein prices lifted to 27.8% from 22.9%, more than offsetting higher SG&A and .
Food Ingredients rose 75.8% to $74.9 million, aided by $18.5 million in net tariff recoveries and higher collagen demand, with expanding to 36.3% from 26.9%.
Consolidated reached 29.2%, the highest quarterly level in the data provided, up 5.8 points and 3.1 points sequentially.
was $533.5 million, up 265.9% , bringing the first six months to $686.5 million; the company held $160.7 million in cash and $1.31 billion available under its .
Corporate costs rose, with SG&A up $4.8 million on higher incentive compensation and $13.2 million in acquisition and integration costs tied to a proposed Tessenderlo joint venture and the Bovinos acquisition.
What changed
Diamond Green Diesel swung from a $45.8 million loss in Q3 FY2025 and a $48.8 million annual loss in FY2025 to a $334.0 million gain this quarter, settling the question of whether the Clean Fuels Production Credit regime would produce sustained losses — the joint venture is now generating large equity earnings.
Feed Ingredients rose to $150.7 million from $90.4 million in Q3 FY2025 and $32.1 million in Q1 FY2026, confirming that higher fat and protein prices are sustaining the 's recovery beyond the one-quarter peak flagged in prior filings.
The $18.5 million in net tariff recoveries in Food Ingredients is a new item not present in any prior period, adding a one-time lift to results that was not flagged in earlier watch items.
stood at $2.5 billion at the prior year-end with one reporting unit flagged by KPMG as having a fair value not substantially above its carrying value; the filing does not report an charge this quarter, but the sensitivity to DGD fair values and commodity prices remains.
What to watch
Diamond Green Diesel in Q3 FY2026 — whether the $334.0 million gain reflects a sustainable run rate under the Clean Fuels Production Credit or was lifted by one-quarter strength in RIN values and diesel prices.
Food Ingredients excluding the $18.5 million in net tariff recoveries — whether the underlying collagen demand and can sustain the 's trajectory once the one-time benefit rolls off.
conversion from DGD equity earnings — whether distributions from the joint venture increase to match the improved , after Q1 FY2026 operating cash flow fell 38.6% on lower DGD dividends.
testing at midyear on $2.5 billion, given the reporting unit KPMG flagged at year-end and the sensitivity of DGD fair values to credit prices and production levels.
Food Ingredients increased 75.8% to $74.9M, aided by $18.5M in net tariff recoveries and higher collagen demand, with expanding to 36.3% from 26.9%.
Corporate costs rose, with SG&A up $4.8M on higher incentive compensation and acquisition/integration costs reaching $13.2M, primarily for a proposed Tessenderlo JV and the Bovinos Acquisition.
Liquidity remained strong with $160.7M in unrestricted cash and $1.31B available under the ; for the first six months increased to $686.5M from $394.8M.
Quantitative and Qualitative Disclosures About Market Risk
The Company faces commodity-price, interest-rate, and foreign-exchange risks, using limited derivatives to manage select exposures.
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Finished products are predominantly commodities sold at prevailing prices, exposing the Company to market price fluctuations.
Interest rate swaps with a $300.0 million hedge variable-rate debt, paying a fixed 3.420% and receiving 1-month through Q2 2027.
Foreign exchange forward contracts hedge forecasted sales in non-functional currencies, with an aggregate of $10.7 million at July 4, 2026.
Commodity derivatives (corn, soybean meal, soybean oil, other) not designated for had an aggregate of $5.0 million at quarter-end.
Forward purchase agreements cover $216.9 million in natural gas and diesel fuel and $208.8 million in finished products over the next five years.
Key currency exposures include the euro, Brazilian real, Canadian dollar, Australian dollar, Chinese renminbi, British pound, Polish zloty, and Japanese yen.
The information required by this Item 1 is contained within Note 18 (Contingencies) on pages 26 through 27 of this Form 10-Q and is incorporated herein by reference.
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The information required by this Item 1 is contained within Note 18 (Contingencies) on pages 26 through 27 of this Form 10-Q and is incorporated herein by reference.
In addition to the other information set forth in this report, you should carefully consider the factors described in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended January 3, 2026, which could materially affect our business, financia…
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In addition to the other information set forth in this report, you should carefully consider the factors described in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended January 3, 2026, which could materially affect our business, financial condition or future results. The risks described in this report and in our Annual Report on Form 10-K are not the only risks we face. Additional risks and uncertainties that are not currently known or that are currently deemed to be immaterial may also materially and adversely affect our business operations and financial condition or the market price of our common stock.