$1.72 billion in second-quarter sales marked a 16.4% year-on-year increase for Darling Ingredients, while adjusted EPS of $2.49 topped analyst forecasts of $1.48.
Stronger finished-product markets, higher fat and protein prices, favorable trade developments and tighter commercial execution lifted margins, with operating margin rising to 32.2% from 5.1% a year earlier.
Adjusted EBITDA reached $352.5 million, missing analyst expectations of $509.3 million, even as cash distributions from Diamond Green Diesel helped fund debt reduction and asset purchases in Brazil.
Management said higher-margin product mix, solid protein and specialty demand, poultry production growth and collagen expansion should support earnings and cash generation over the next several years.
Darling's massive profit jump relies heavily on biofuels, but what happens to its margins when global waste feedstock supplies dry up?
Can a traditional animal waste processor truly disrupt the multi-billion dollar nutraceutical market with its newly patented blood-sugar management collagen?