Darling Ingredients reports strong Q2 results

Darling Ingredients reported net income of $387.3 million or $2.41 per GAAP diluted share for the second quarter of 2026, compared with net income of $12.7 million, or $0.08 per GAAP diluted share, for the second quarter of 2025. The company also reported total net sales of $1.7 billion for the second quarter of 2026, compared with total net sales of $1.5 billion for the same period a year ago.

"Momentum continues to build across our business, which is reflected in our strong second quarter performance," said Randall C. Stuewe, chairman and chief executive officer. "We stayed focused on the things we can control, including strong operational execution and margin management, which enabled us to generate strong cash flow, pay down debt, repurchase shares and further strengthen our financial position."

For the six months ended July 4, 2026, Darling Ingredients reported net income of $521.6 million, or $3.24 per GAAP diluted share, compared with a net loss of $13.5 million, or ($0.09) per GAAP diluted share for the same period a year ago. Net sales for the first six months of 2026 were $3.3 billion, compared with $2.9 billion for the same period in 2025.

For the three months ended June 30, 2026, Diamond Green Diesel (DGD) sold 348.8 million gallons of renewable fuels at an average of $2.23 per gallon EBITDA. For the first six months of 2026, DGD sold 621.2 million gallons of renewable fuels at an average of $1.74 per gallon EBITDA. The company received approximately $211 million in dividends and approximately $69 million from Production Tax Credit sales from DGD.

Combined Adjusted EBITDA for the second quarter of 2026 was $741.7 million, compared with $249.5 million for the same period in 2025. For the first six months ending July 4, 2026, combined adjusted EBITDA was $1.15 billion, compared with $445.3 million for the same period in 2025.

As of July 4, 2026, Darling Ingredients had $160.7 million in cash and cash equivalents, and $1.3 billion available under its committed revolving credit agreement. Total debt outstanding as of July 4, 2026, was $3.9 billion. The preliminary leverage ratio as measured by the company's bank covenant was 2.3X as of July 4, 2026. Capital expenditures were approximately $224.0 million year-to-date 2026. The company estimates capital expenditures to be approximately $450.0 million for fiscal year 2026.

During the quarter, the company closed on the acquisition of three rendering facilities from the Patense Group in Brazil for approximately $122 million. On July 22, 2026, the company closed on the sale of a majority of its non-core grease trap environmental services business for approximately $90.0 million to Waste Resource Management.

"Importantly, we believe the opportunities we outlined at Investor Day remain ahead of us, and our second-quarter performance demonstrates meaningful progress toward capturing that value. We feel very good about the balance of 2026 and the outlook for 2027. The fundamentals of our business remain strong, and we are well positioned to deliver continued earnings growth, cash generation and value for our shareholders," Stuewe said.

The company expects to continue to deleverage and anticipates ending fiscal year 2026 with net debt at or below $3 billion and bank leverage ratio below 2X.

As previously announced, Darling Ingredients will provide financial guidance exclusively for its core ingredients business (all segments excluding DGD). For third quarter 2026, the company estimates core ingredients business Adjusted EBITDA to be approximately $325-340 million.