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Riding High: Darling Ingredients

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Shares of Darling Ingredients Inc. (DAR) are up over 37% year-to-date, clearly outperforming the iShares Russell 2000 Index which has gained just 3.2% during the same period.

Darling Ingredients, a component of the Russell 2000 Index, is a global developer and producer of sustainable natural ingredients from edible and inedible bio-nutrients, which find use for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy and fertilizer industries.

With operations in 5 continents - North America, South America, Europe, Asia and Australia, and in over 15 countries - the Company functions in three industry segments namely Feed Ingredients, Food Ingredients and Fuel Ingredients.

The Feed Ingredients segment accounts for a major chunk of the Company's total revenue, followed by the Food Ingredients and Fuel Ingredients segments.

Here's how the Company's key metrics fared over the last two years and the recent second quarter.





MetricsFY2015FY2016
Net Sales$3.39Bln$3.39Bln
*Net Income$78.5Mln$102.3Mln
EPS$0.48$0.62

(*Net income attributable to the Company)

Net income attributable to the Company for the second quarter ended July 1, 2017 declined to $9.1 million or $0.05 per share from $32.0 million or $0.19 per share in the comparable year-ago quarter. The decrease in net income for the second quarter 2017 is primarily due to weakness in the Food Ingredients segment, particularly the gelatin business, and the absence of the blenders tax credit, which was included in the second quarter 2016 but has not yet been reinstated for 2017, according to the Darling Ingredients.

In the recent second quarter, net sales climbed to $896.3 million from $877.3 million for the second quarter of 2016.

Having ended Q2, 2017 with cash of $124 million, up from $115 million at the end of the fiscal year, and current debt ratio of 3.59 times compared with 4.1 times at the same period 2016, the Company looks strong on the balance sheet.

Shares of Darling Ingredients touched a new 52-week high of $17.87 on Friday (Sep.8th) before closing the day's trading at $17.82, up 0.51%.

by RTT Staff Writer

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