Darling Ingredients (DAR) 10 May 232023 Q1 Earnings call transcript

Company Profile

Participants

Suann Guthrie	IR
Randall Stuewe	Chairman and Chief Executive Officer
Brad Phillips	Chief Financial Officer
John Bullock	Chief Strategy Officer
Sandra Dudley	Executive President of Renewables and U.S. Specialty Operations
Manav Gupta	UBS
Tom Palmer	JPMorgan
Derrick Whitfield	Stifel
Dushyant Ailani	Jefferies
Ryan Todd	Piper Sandler
Andrew Strelzik	BMO Capital Markets
Sam Margolin	Wolfe Research
Paul Cheng	Scotiabank
Matthew Blair	Tudor, Pickering Holt
Ben Kallo	Baird
Tony Bancroft	GAMCO Investors
Ben Bienvenu	Stephens
Jason Gabelman	TD Cowen
William Baldwin	Baldwin Anthony Securities

Call transcript

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Operator

Good morning. And welcome to the Darling Ingredients Inc. Conference Call to discuss the company's First Quarter 2023 Results. After the speakers’ prepared remarks, there will be a question-and-answer period, and instructions to ask a question will be given at that time. Today's call is being recorded.

to call like to now would turn over the Ms. I Guthrie. Suann ahead. Please go

Suann Guthrie

for Thank earnings XXXX you. joining Darling Thank you the Ingredients first quarter call.

and President John Bullock, today C. Strategy Officer; Brad me Mr. Sandra Chief and Chief Chief Dudley, U.S. Ms. Chairman Operations. Executive Phillips, Mr. with Mr. Renewables Executive Officer; Here Financial and Officer; of are Stuewe, Randall Specialty

our the and news once quarter and slide of on on XXXX Presentations available Events under earnings transcript release website, be Investor first it will page Our are Relations a and joined corporate tab presentation is by available. call this

XX-Q Risk assumptions During with update We projections are and risks Actual be in yesterday's undertake and to will of These any our subject and making results predictions, call in release any about uncertainties. differ because can do press statements which forward-looking and future XX-K, and discussed events. other are on comments made conference this of Exchange that call, other Factors duty based Commission. factors statements to section forward-looking Securities this and and we during reported are the materially not the statements expectations statements. Form the current filings

to I will Randy. call now hand the over

Randall Stuewe

Thanks, our thanks call. Suann. Good earnings for morning, everybody, for quarter first and XXXX joining us

our We and attained system DGD the have had performed a of very rate March. solid start full to units as the year. expected month All during business

while Diamond segment segment our the detail, the EBITDA, Ingredients $XXX.X million Feed segments ended $XXX.X our with at Ingredients $XXX.X to XXXX, earned Food Green The million, attributed $XX.X Fuel for in Specialty at in quarter EBITDA. earned Diesel. million the $XXX.X quarter we million in adjusted Looking at first our approximately ended combined million, quarter segment

material Turning Feed detail. XXXX. first to segment quarter to raw were Globally, Ingredients XX% volumes up compared in the

in prices, remain global saw protein strong While world. the fat decline prices we a around

by it than margin a focus. once higher Diesel Green key the of be in prices I'm earnings While Integration report will gross future remains impact offset Diamond to lower will acquisitions modestly sequential quarters. improvements. that more realized pleased segment, fat in recent we again our

to as reliability us our and finished at allow Eastern to will efficiency, market improvements and continue recently products. USA plants well improve higher produce that We make value acquired

We and are the pleased we progress will by believe nearly with end, year be complete.

and and system to our remains we gelatin collagen started. robust. pipeline believe global in Gelnex come. Ingredients collagen closed has we strongest products already the Food The world on XXst, years robust segment. business with new the Turning integration Specialty Together, We most acquisition on and to a work the have March for of

Moving Diesel quarter. to first running segment. set another very record Fuel is Green sales Diamond in and well our

noted with have It gallons be Green moving and fat light for achieved record inbound to prices a logistics the a loadings DGD X.X billion should We March system were QX. smoothly, Diesel. annually. into is ship Diamond shaping shipments be second at quarter milestone up operating with that lower running With

then financials, hand like take the the my and on Now and outlook the with XXXX. thoughts Brad call of to us come I'll I'd to to over through Brad? back this, discuss balance

Brad Phillips

in primarily first $XX.X million due or for quarter net XX% $XXX.X Net $X.XX increase the to XX% $XXX.X million quarter $X.XX of billion quarter to gross per to first totaled first billion $X.XX to first $XXX.X diluted $X.XX Operating compared XXXX in for diluted quarter. sales. compared for first Okay. Thanks, the million or XXXX to income a $XXX.X as share income for XXXX Net quarter the Randy. for for income million XXXX net were the of quarter compared first per of increased million a margin. the the share XXXX increase or XXXX, sales

margin an increasing $X.X increased currency expenses to $XX.X million plant in gross of received million, proceeds offset expense to the increase other increase of quarter-over-quarter, primarily the and all said, and restructuring loss prior insurance more costs an to which offset million SG&A was $X.X year fire. in Diamond amortization increased earnings Tacoma improve $X.X than As $XX.X depreciation Total Darling's Peabody million, related approximately $XX.X sequentially other the million which primarily for increase partially closure. interest $XX.X in million income Green quarter-over-quarter with Randy by additional in foreign casualty segments. increasing Diesel's due of gains an for share of million, continued $XX.X million and about

taxes. of biofuel the statutory primarily The and income $XX mix earnings in relative tax expense XXXX of among which income tax million to for XX.X%, first million of with to of rate rate defers tax from quarter due effective tax jurisdictions the company paid turning federal recorded of The the of with an quarter $XX the the income first XX% company incentives quarter. rates. Now first also for different taxes

sheet first closed the first billion we after XXXX, end acquisition approximately QX. rate for year. an the year quarter Gelnex are at billion XXXX projecting a as debt very Gelnex. funding, debt an million loan, taxes average $XXX of euro rate during inclusion million at recorded by billion quarter, The company's debt X.XX% and the hedge debt swap converted of was XX% to tax to The and total two X.X%. activity and year year Gelnex entered outstanding $XX million the interest $XXX exceeds a floating rate was end three Gelnex a $X.X assets no Since also the entered of earnings compared in at fix US swap $X.X we For swap reduced XXXX. of now balance the of rate cash $XXX In remainder of the into conjunction effective intercompany at of which fiscal synthetically interest the into currency rate to with cross euro with of to

first end fiscal was the end at bank X.XX of times X.XX at to the compared quarter Our XXXX. coverage year as ratio times leverage

$XXX first million of $XXX strong with on quarter million common of maintain Capital approximately first quarter. its to the facility expenditures liquidity, year. expenditures anticipated of revolving with our of in $XXX.X the company during the The end. for stock quarter remainder for million totaled shares as $XX.X repurchased XXX,XXX available continue million We credit the

it that, you, With turn back Randy. I'll to

Randall Stuewe

have Thanks, gelatin Darling Diesel are very next strong, evident moderated, in Brad. collagen Again, have are tremendous global power business earning is material few demand. and line prices to Diamond integration expectation, will volumes over with and a in is activities energy lower off XXXX. expected for global robust green Europe very quite Raw of our and built business to with on well quarters. premiums become Green the material The target, start unique vertically-integrated is we strong perform prices, raw our

acquisition remain on acquisition of million. year-end Leverage reality combined to become the range environment Other and management been we to operating deleveraging. will along expectations the activity expected have post Miropasz committed bolt-on EBITDA and of Finally, DGD Brazilian very $XXX policy has $XXX grade XXXX. estimating value our for we we delevered previously second are to that by our with concentrate a for discussed. integration, M&A a have is in year-end, now investment ratio soon. our close we high the has I financial dividends which creation should previously-announced the and continues, goal we target can paused million And nearly than peaked by leverage X.X so adjusted is quarter. to in if Poland, be our

adjusted the billion $X.XXX year, we are combined our again EBITDA. reconfirming For once guidance of

to it open that, let's ahead up go with Q&A, and Now please.

Operator

[Operator Instructions] And will Gupta our come question from Manav first UBS. of

Manav Gupta

question looks things your to Feed giving which in Great to Feed next higher both can actually see in recent now. the volumes. for these market very but place really gross to to for falling demand have with for longer products, your is Congrats Food, months? expectations. fats, XX an XX a push got increase continuous deals, see the for quarter. products Do you regards Those on on demand your some up improvement the deals Randy, UCO medium in a will are and we proteins think exceeds well demand far and are And hold you term? the bump, big actually which margin. good volume in you back M&A like My support

Randall Stuewe

on incredibly oils as have strong remain And John tag this little here Pet team bit proteins But a the I considerable palm biggest come fats there. running of in expected. -- here. thoughts and can't yes. a than to is for world demand mean, oil attain all fats some kind premiums Bullock, out at the remains and are then fats around With and the premium, can seems business the the bit oils demand capacity. and waste global premium pricing food mean, I with strong, world. little leading Diesel that, demand following good. above Diamond soy way Green CI off other two is and a the Clearly,

the at of to so different as the if than, struggle day, logistics you And end fourth down that's with continuing Port were quarter we will, Arthur. in the

that supply want or arbitrage. to It's on to Green information of It strategy people to can't. The as whether to XXX% we is we doesn't that the will So Diamond people continue built the it Diesel is a the that of and big. continue Green piece Darling be one going Diamond concept strong just understand ignore Diesel. team, under. from too comes demand very import, yes, it management domestic importantly, But depend most

Our we supply not have to system want up globally It's don't today. to better if has half about we the that ability markets. to, if near

Feed It's the what's mean the So simple. to business? overall segment to that and very

penny US have move up shareholders prices EBITDA. $XX every or $XX that million, is for around in annually We million the down told fat years dollar somewhere

million don't of that fat million to prices are down, that's $XXX So let's call $X.XX, $X.XX, it, $XXX know, EBITDA. I

we improvement Half or then billion plant that So pound Diamond if $XXX between of call two gallon a $X.XX, margin. so EBITDA of. with X.X times and you somewhere yields a is half gallons, million Diesel Green in which easy half got it, of million us, $XXX for in just standard potential a math, thrids improvement, you've $X.XX and $X.XX of get capture

investment sense amateur give to million basic good or if million back that's thesis, going pretty a investment. $XXX So $XXX you you of $XXX and in they're give somebody the million,

for drives on that to Green Darling. you earnings system want that built. people Diesel, larger add and we was John, share system want the focus the to we anything demand to So of it's collective a this? Diamond

John Bullock

Yes.

the mentioned kind deal. there, we is of the value FASA to world, we I massively We scaled to Valley in our form Manav. it prices The of get fats fat at your or are of in in fats it We're CI because the Green Diesel. in for low going have Diamond low what higher Diesel. get CI margins core either deal of statement available it Green to the ability higher going scaled Diamond Green the the system reason Diamond our form think and know at in you Diesel we're and

to the going win how we're dealt. basically, are cards matter So no

Operator

Tom next question of will from The Palmer come JPMorgan.

Tom Palmer

know and I just there's through -- walked a little you bit.

you base rough between business two that right, But Diesel. what are you're But pieces, kind business some sides EBITDA pricing feedstock business? I today. splits $X.XXX for EBITDA in billion thinking of feedstock And both terms and the there of in moving for the your earnings. provided how of pieces, the what and of Green at construct hear Some didn't especially then outlook have within also moving the that with guidance do base Diamond some I that the DGD know outlook per again, pricing. you've any and of at gallon means past, kind

Randall Stuewe

as That's Fuel. want said, and Feed system Bullock we the on we win John It's either segment a trying rather the focus to down part scenario. dynamic to to and people situation, Food, that under than

saying the at end day, the out, coming where So XXX. we're of that's

checked. that's QX. the divided some will at I in So by of we believe day, Diamond have end Diesel for bigger how I last And time that the the lower XXX? do minus opportunity get X.XXX Well, in prices Green X, fat then XXX gallons

the other that's on And so comments, boat the from largely one of said, as loadings not target. and ledger made we're it moved forward. earlier some guidance. giving linear I gallons we're of from to But go larger QX my side to As we as always will where side the move also we QX, the are in ledger

Tom Palmer

up gallons could just follow maybe the I on And comment. quickly

year, there look quarter, I last $XX production of a was under bit at to million. if last So $XX to a million relative then last about the shipment years, was couple and it closer

in always that much portion going So just to forward, is of in inventory how get this thinking unwind million this of much business, just inherently out? just $XX that is shipment that trying million of pool it's unwind is kind terms as a there closer the accumulated about little kind larger of is talking to million or $XX the a in given bit to inventory, bigger, going be so coming plays of when held? it timing you're about, should be we sense paid there there's more $XX should that I'm being a year

Randall Stuewe

a Green look business -- let you or for doesn't go at day it. the to Darling ships recognized recognize have our go, little don't Also, it's a miss and No, ships it get system, bit. to I said, you in as unloaded, back comment created, understand and and and if Diamond in you when business. Diesel Sandy until I the and and XX I'll bill been years like come ladings get But

I pieces lading So maybe dates the those at in million, to added, there's million $XXX at I have $XX look if the $XX bill always it here, million the I don't obviously, quarter know, and look But here. would in QX.

So load inventory to rail about load is to we nothing so or to or here, granular going can overthink. ship we get no, But and as there we as build go load that's try there. as barge we

Operator

comes from And next question our Stifel. Whitfield Derrick of

Derrick Whitfield

on Congrats start the to solid year. a

is in prices. your I wanted QX up to guidance. that, of question, margin isn't for EBITDA apologize, margins including seemingly business. fat is my in and model segment value I us that Gelnex's and X:X Valley's in Food, conservative? guidance reasonable And segment, margins now in to and nearly From Having XXXX uplift DGD the first of the it net-net billion contribution you every your business as but a outperforming your and have every in to want EBITDA really on perspective, margin better our think of Feed for $X.XXX gain your said tailwinds lower focus our For frame relatively result set Randy,

Randall Stuewe

I My personal world fats, the as the opinion that I system as is the world our want Green on bigger advantage, of earnings inverted marketplace mind that it crops everything tried with this releases keep around in there. again tell Diamond people, year. of been a and is, think is significant to out still to the competitive but other proteins we've very expects has Ultimately, it's Diesel obvious

Diamond done margins trying gallons normal the we gave there we're of we're the or $X.XX? feed to we of in make But the of getting forecast. now, guidance job And feedstock. the the with the our kind low is in team of I clearly, aligned Feed we're Why? higher. segment, Because the sure about and at day, a -- quite -- a to what, spot so operations system sitting tremendous what Darling going higher year that has a in end that and operations. earlier -- mean it that bringing do trying basis those believe Sandy, Green are on system bit of billion X.X Right

are Brazilian very well. Our operations performing

business is the with very system doing in six second about another being world business Europe. green collagen then our integrated quarter the we're to plants well, and and or around and in, Gelnex add energy seven in here gelatin in Our the

you So really. I that with proper These management. want but there a are to that? John, going mean, anything operations add are not solid risk of just yes, tailwinds bit now on are here to

John Bullock

we're system an our offset business. price a have about go times. now impact multiplier management offset inside as be that's I lower margin But going think down, and oftentimes, There's an with embedded prices we no may we what look core embedded the and actually -- that that fat it rendering doubt the an up on have right? company, to

businesses, day, the and even So place got embedded material the we're impact fat at that. our only all but insulates our marketplaces. or manage able from core rendering an segement around embedded of end raw of on a us to system tremendous not an -- in an the where offset costs type of impact, our we've our tremendous any the we've And now that impact

higher, company are we sustainable we to of no are matter EBITDA market very the to markets to lower. very, end at day, about out are conditions the have good So what going But going the how feel go the go markets there. position

Derrick Whitfield

Could what follow-up, with A, and now perhaps between to, it my respect you've into And you with synergies speak about to you see the potential Darling B, it assets Gelnex. and integrated you've learned that the Rousselot?

John Bullock

tremendous, team. as three tell seen the professionals, excellent to Darling tremendous, excited a way in Gelnex the well are top excellent, an they're are around. group of the organization the with you more good are my managed, just be that all I plans weeks Gelnex Gelnex can into efforts tremendous cannot ever marketing employees, it's organization the family. their is life. last organization their I've spent We as These I bring

Operator

from question come And Ailani next will Jefferies. our of Dushyant

Dushyant Ailani

on Feed is, Feed the is normalized like we recovery? guess My first base for X,XXX-day about looks margin could one segment. you've know integration. margin? timeline do sooner, you're recovery seeing But my to about what's gross good previously, segment question a which I how is margins, think It that good. talked on I think about the be in

Brad Phillips

Randy last Say, transpired there mean, yes, so pointed a our in you've will our I we guys still expect out yet system, there quarters, we be have operations noticed. in -- improvements and to gained two is definitely continuing the -- what's continue.

the where QX is level, we were mid-XX% somewhere last which say ballpark back the let's before in in So year.

Randall Stuewe

in place moved on Brazilian markets to and of also around kind put risk down but down have here. the procurement, the to had there We've spread as systems you guys focus mean Valley, clearly, rendering there. system I management management want

be right in says, margins had there. mean out we a products end to that summer do material material as got the near modified year, work most there very different fire margin. in to be to other still maybe as year normalize had be then But now. November, between to have than that in in and year some learn manageable Their transportation I reliably. QX, to operate as the then We've of we agreements to said, got last of plants, somewhere Carolina, coming still more it part, between call expanded up and be and opportunity in a the Ward, in and of the agreements. very loss the And complete we mid-XXs, additional to going Tacoma Eastern raw by the make some in there Shore South $X through still expenses it's seems I learn raw as them half. plants couple Brad and million So a expect we integration related million, very, I flowing to system for I there that to should fire was $XX that procurement have

the system very think But -- the we management as the margin it's around move complex done is So overall, forward, you're in well. quite I seeing world. being it been,

Dushyant Ailani

your my in prices the the you of is, improvement a back year. in be modest there's modest you going to slides, expect question mentioned fat And second in a or improvement half

in going DGD do DGD? is you think then, margins for So a how to margins XQ peak about be

Randall Stuewe

always have I said here little and to calm. I be, don't know, So a bit I

it ways. have both can't You

doesn't can’t side diesel is you at to fat down going margin continue so and then better down. prices prices work a me me are to the coming are other tell to way. DGD, can't earn fat and capacities all -- go this renewal You it that going online tell we go And

of believe the the but It's story to Sandy I strong. the we've we will for defer So as call XX April short, them year remain by in Sandy? I'll kind always balance a What and beyond to would DGD hard forecast days of is next of bit, means that here any margins you say, wouldn't seen long little now, peak.

Sandra Dudley

that system. as great But we will know a what don't think we prices do. have I would feedstock John say mentioned, had I

go And we'll see our so up, down, benefit prices feedstock in prices we If if we'll benefit we go see DGD. feedstock business. base in

time, I in we're going point advantage where they're great going to But an going go. know and know this that for to don't us. at So be I to have it's

Randall Stuewe

a we that it's now shipping out our RD Europe, rendering fats which guys comes HVO And first boat the Green -- have the The is think the call helping a would that's be pulls as plants wake-up in Europe. have say should we're I in other out system. best we to thing bringing because there. Diamond prices of in Europe. our global And margins We're the market Brazil, the and fat system away Europe of from everybody in or bottomed from

we quite bottomed, reason believe the balance will remain DGD margins we and that's have the think for fat in prices So the strong of year.

Operator

Ryan of from Todd Sandler. comes question next our Piper And

Ryan Todd

Phase Maybe feedstock absorb diesel following too much seemed renewable I up addition within the markets the without mean, the the on market to III DGD business. the of pain.

on supply improvements that and You've online with see R&D additions capacity of got your that by all of capacity have part that, other the on on side effects or of kind business? to any either tightness you of seeing in low additional of market helped within the business, that knock-on the the some at some end the Are feed material likely of any come large CI very the ramping signs you year.

Randall Stuewe

to Sandy the from we in mean of my shown have really. Green and is seat, pressure originate that locating the took help me water, on everywhere answer And we bit. some have Diamond could Port here not start-up. the the I And From by Charles that Diesel world. ability St. little Arthur the clearly, X a off

logistical was, been thing had unloading inbound that some The have clearly, we challenges there remedied. now second

we we're and and amount running and QX, a were tonnage you It's ultimately, we railcars from where of up ultimately, before you what higher are And that what so bit cleaning the running quite now? rate say, you rate if inbound were well, had. in

So to Sandy, what else add do to that? you want

Sandra Dudley

going online, market always is we we what look and in a that were online been to new has X facility DGD when like. Since feedstock bring

any issues feedstock. had getting haven't We

maybe bit. We Now in supplies. some a our little brought international has more mix changed

by throughout and as actually supplies are Darling FASA and world entity, Some other those we've of supplies the found our looked well.

supplies We Valley obtain through also Valley or more our were we that supply entity able bought. to

we So turn, we're as -- and we've that. serve DGD Darling, able to grown for better just in

Ryan Todd

to sources? how came from much quarter Are international willing feed in you like of is last roughly the say this

Sandra Dudley

think I we that's that share. something don't

Randall Stuewe

move No, you're in headed around I offshore quarter-to-quarter, the think that in the improvement from from material is in will clearly, protein’s big month-to-month. mean, I the before. Feed was what seeing the segment Valley like piece that margin the majority was

there. sold Now to. RBD have the still them. to it I'm that never selling get that visibility on see to they are ability then we to Ryan, and them, lot have all we've close pound the then little a has system. we a question, to soybean -- other and the go to pre-treatment of your a bit And guys claim out apparently, report other guys We guys's capacity Relative of to you out there, there no and to there's read

So that's here. all see we

Ryan Todd

your your Maybe a the note, year on a leverage like -- this But remarks. bit of by the we hit. said you've you quite your cash a end of that about target on got think earlier totally in term, in as you'd near follow-up the use a to separate of

buying currently back You're some stock.

roll excess need to the you of terms think the of or the you mentioned, As I in remainder dividend, priorities over cash? that of which look do target about -- end before how able anticipate you a we the year this next guess, do you at to hit of year being the, that debt the likelihood the dividend, a use out over of before

Brad Phillips

is the in of do over starting now, with with are cash at term outlook before the let's feel From say, deleveraging So from dividends We as looking certainly is but before, that we margins dividends QX mid-year. in we seeing our the of the do, by which confident obviously the that. year. theme here possibly very end sync the of in we're concert near terms at JV looking partner our JV, said, in in the at here

looking be agencies we at So what combined rating bank our at. times. that's base if want clearly do. look the mean, business down is that you're with bit the to different looking mean X covenants below grade, little investment in than I a that I at

into they other that add So some things back equation.

we want times the to into us with that give clearly So to be agencies leverage X below rating story going XXXX. and

would be looking not think I at dividend. the we So

I be get X here 'XX, from options we're to then in back shareholders times, below sustainable think, going Randy, to be our there. -- there, evaluate

Randall Stuewe

if clearly, 'XX, it's momentum a we're for carrying exist that of that set opportunities And us. into different

Operator

The from BMO Andrew Strelzik Markets. is Capital of next question

Andrew Strelzik

is kind we of about there this contribution the annualized Gelnex. through had to I think don't of you to any What to of year you contribution end When closed million wanted have maybe lower 'XX year on that acquisition, think that on ask kind to million, numbers guided $XXX the $XXX that of that you the How million First, would in the the for reason originally talked we the of this $XXX to range should year? kind you And the end? cadence lower million being $XX about. pushed to the exit implied?

Randall Stuewe

we've and just work-in-progress inventory, inventory lot way a me impact like XX, bring John the closed QX that's that's did impact. clearly, March as We of Gelnex. I we produced and mark-to-market got so been on Gelnex, Valley pretty here in can accounting mean on There's good over at here. we on in. it a help had with purchase FASA an

$XX now, the inventories. rate suspect of right there that balance the think, million it at Brad or you some you will out annualized see add the working student Gelnex. a we'll but you're I of or capital impact. John, If want And conservatively get We've million, the $XX anything? earnings I sheet, in is to in inventory net maybe from QX

John Bullock

assets. QX, associated and fabulous in inventory at running extremely what on impact the fabulous have out terms earnings we've extremely fabulous strong with they're but organization of Gelnex. Obviously, the business will expect out market is running No, It's get there strong. and value adjustment operation, guided parent fully an we to

Randall Stuewe

$XX is the not million that remainder. annualized year, And that's full an

Brad Phillips

year. That's of the this remainder

Andrew Strelzik

On the all-in year. the EBITDA guidance for guidance,

the kind in I like think be back understand reason XQ? shift that little bit guiding about does it quarterly than you XQ? I XQ the thought you what about guess then shipments softer of softer back stronger, of so would rate other also a you're talked the It that back half as for from simply So a did Is a basis that sounds to the the run that half would half. any function of to XQ, be math imply you on Gelnex

Randall Stuewe

know how billion, to you, not we're $XXX be that's million, who million forward here million, and have $XXX there. have $XXX we honest QX But QX other see knows. than $XXX or don't to really $X.XXX won't to that idea. But believe coming forecast from see with don't answer sense call the that's any we I we'll our whether we reason what million, our confident then to we see and rather a $XXX I to hit solid million, with try today the but that, in in no today,

Andrew Strelzik

I I that. and trying understood was the to of… puts I guess just understand Completely make takes sure

Andrew Strelzik

in keep to there's if Just mind… anything

Randall Stuewe

assumption answer I no. rendering And guess It's is no math. shifting quarter-to-quarter. from No, understand. Randy's I There's of the shipments

Operator

question is from Goldman of Adam Sachs. next The Samuelson

Unidentified Analyst

integration Adam. for segment. in stepping a have Guillermo the actually is the on Food only within This I follow-up efforts

first the the rest your If could and for quantify quarter year? in realized the expectation synergies the of you

Randall Stuewe

and different ever in thought is was there. expectations we're all regions, spread United still States I number four have the we've we a out we’ve the we day, end five of running that out said. so there as put at upside don't -- more we never be business there. over believe there, some the That no At we I would know synergy where or

where lot that different at people, in procurement we thought So lots of target our that a material done be. making at excess ultimately, progress showed the our rightsizing energy we excess reliability, from -- Board. business or trucking, wastewater lowering we've of rightsizing disposal. in We're costs, them, and and things and raw We're that's we business would improving the contracts we're case

is this us. Now upside to the rest of

Unidentified Analyst

did to quarter the trying buybacks. delever the relative regards we the in balance amount How squeeze you in could sheet? to think buybacks I should the the the if are you that in one about And also as pace to another first of

Brad Phillips

in the as We the say weighing just in done That's early deleveraging kind opportunistic to the quarter, here. couple years, We'll of and our not cadence just opportunistic we'll just remained there just the we're at year. stock remain the the and So see in level of obviously, million last strategy -- the is, softness remainder stock $XX on of that first in quarter. where price the we've truly the there. versus that

Operator

Wolfe The next of comes from question Research. Sam Margolin

Sam Margolin

great try. is has sort be You seems front. like because based or might the to want And not CI would of well. one, answer oncoming like that. It a and of it country balances? the you're the it a pretty China, just the it appreciate Darling sure give could meaningful what addressable this an on think be you the story ground, And a in of low it of the a previous lot China to is, China, seems materials to RD But sense supply untapped on I'm in I'll given fat a capacity question of rendered you're get UCO market but answer market context I people on presence a there, know not pretty

Randall Stuewe

secret and take see guys mean, I boats Sandy that address. let I can you I'll so there. in, mean, there's coming the no

Sandra Dudley

more what Yes, would we than volume there's exactly ever that be, not think there I'm sure be. expected the I because would

oils have available to over prices are up that's around time, more As world that and us. the fats about gone brought

low real nice that and are that European the as out ISCC one benefit that that's of to fats, they're the And a because there we're that's fats, Asia for. seeing things the CI is are nice a of searching go us. we're trying there of to to that's that look to One things market thing

And to bigger so know I think market's don't amount, the know. we that than I the anticipated. ever exact But

Randall Stuewe

mean, obviously, highlighted that Europe bringing I there. the US piece I we're little into from fat cat more One X now.

be coming than work? economics Why Chinese biodiesel fat bringing other and now would asked Because do cat cheaper ask fats the into making there. the we why someone Europe And to you work? X have economics

key grow. I at for probably than think we world. more around it team marketplace now. as in clearly if I there. world, a continues half extra understood, we're said, looking around high the is year, say legitimate the Sandy want Green magically you. far ago is the So to sure become that is of so you to procurement year not it highlighted everything point coconuts island, the to the ISCC is, and think it's business find commodity big But certified, one is the which the you is Sandy probably we dynamic fats lots critical and all is to CI question interconnected Diamond low available Ultimately, making how And priced sure

Sam Margolin

just is And well. because sounds this going follow-up on like integration is a the Valley, it then

the power. in plan you now but I to with, associated some margins according as a think guess, you was or said Darling there facilities was it standard, far plan. up earnings and on And I that acquired to taking place you're capital the as good

And is to so the going accrues little you be pace Valley is, the anticipated, more a bit which of the light than and sheet question actually maybe then balance to capital deleveraging? the integration

Randall Stuewe

here, rebuilt, think replacement in end rebuilt year, I big the reliability that through have we one. And equipment like be June done No, by the will improved three And in being or here. XXXX, Ward fourth X with think plants. the then by I I more six the we'll of think then

finish year not money, out where from So $XX million maybe more year we're little over would. as giant a we we then we the system. thought little this next It's a and

characterize target. So day, just I of on much as it at pretty the would light. say, capital the I it's wouldn't end

the in struggled it. that really But of here, really As worse tremendous antitrust system. now. of to was the keep forward to remind about We're were we of people, reliability equipment. to we're this we just and inside the as of while of got our closing a sound I than the pretty moving we it set the really the ball plants, run shown the prior some think they job a Absolutely, Is numbers and we acquisition, side the good see can't done little or and team thought? feeling visit given has quick you walk-throughs

Operator

Paul The from next comes question of Cheng Scotiabank.

Paul Cheng

a the in and of have lot Randy contact you RVO have insight in the government. the LCFS and good market

is insight revise you that they that, not market there or curious may think that EPA just RVO what may is California and quite you any do proposal changes revise the on how So also, can do? share LCFS the the about how

Randall Stuewe

take to want you do Sandy, that?

Sandra Dudley

a probably more -- little help bit on here. the what you're need I markets LCFS and RVO Yes. the

I with saw So regard to a is little bit we that disappointing. think RVO, the what it was

is regarding period There's comments, hopeful. we're comment industry, a EPA information additional that think et cetera, actually where there. feedback, been I provided has what the to out

And see a in bump hopeful up here so that maybe we'll we're out June it XXth. when comes

CARB, think positive of CARB terms I is In very thing. that a

know, you terms in As they're Darling, going as positive XX% their XX% it's at targets they're reduction scoping or of to And from very through increasing for XX% things XXXX. plan. looking in their

our be mechanism. of converting things obligation that. at at they're that an doing interested acceleration we're also for LCFS other to which they're SAF, looking and we're looking facility interstate that as building they're things they're or doing really proposing is then is an really And facility flights, SAF in one the other should The an especially great also

see And positive then those too increases bank just the an And credit alternative the so that there. for And a the there RVO. maybe are we bank think increased, all the that be little where us. things recently high credit bit if gets and back mechanism stringency about we that would did

we with volumes see the Act see had We in opportunities RVO that we the and that that what some terms Inflation that may was if be of SAF. then missed get regard a we've that And potentially. think assets. And also I is would lot see We stranded positive Reduction some of that with up like I think stepped plants of maybe those forward. would to a crushing unfortunate. we things step may in don't would see terms get

what it's And be. important think so listening that EPA volume I folks to should the about is very

Paul Cheng

of And a stopped seeing Sandy low lot both CI and of into second getting have question is US. you think that international said, I the Randy, feed you the

the look maybe is the feedstock that like it was ago a CI So availability anymore, of [resolved]. issue does just year contrary not to low a

into that decision what will And whether factor criteria that what will you want expand into standpoint, making so process, will to factor or the DGD X? the into be from DGD other --

John Bullock

world it year a on much Green was was the we there's going pound. the Diesel call that our would half everybody ago, devil there clamoring at a available fat $X.XX because the fact available be why Diamond interesting and of this in CI in was low answer fat And about to kind make and X. so It's the But comfortable around set Diamond when X $X.XX you in may marketplace. that's in We're X different are to fats because of X, very seen. we the reclamation with relationship we get to systems now world, what the a and we've to higher exactly where a and waste be find pound, more prices world,

the The next higher market our on like see we're size as here a works develops lot to Diamond I processing everybody, about if area. this focus we SAF going a X, as Green we're is all on we have value, have like develops we've the the though, Our this is higher think ability expand. Green really Port Diamond our the the because Diesel the to we and preset Diamond ourselves think the though. that over on Diesel make we'll available we capable at to converting the but that's in I this make do higher-margin of determination cannot build in should Arthur one reason complete that capacity But talked of to and where that focus have SAF X, has into then so we value. the so space we part certainly it, market remind and a plant. Diesel And Haven't forward forward The stuff now, time, are. gone doing operating watch that converting point point at overemphasize available. that we'll right essentially for we we to year it fat or been Green we process

We logistics the have the pre-treatment and chain, supply capability. the capability

vast actually So high majority of take fats renewable become of it there The can value available, this can't our the the low that. into as material competitors these and is, convert CI fact do out diesel. matter we

compete designed So that we are Diesel. plants with they building know aren't but to they're Diamond building Green plants

Paul Cheng

what No, happen? But trigger what that's to still and the the Valero be to I precondition want is will for for or decided you what fully to DGD that go I say order X, agree. okay, try condition to and understand, peak that, -- just that in

John Bullock

a complete this. anytime do through we go analysis We

economic always the take is a engineering go We well. will just extremely know We to construction that now look that a I'm always but I things thing of I for-profit operation. the going as which list the gone you, a through, conditions. the tremendous we're Darling don't understand and analysis look to five can necessarily the a going to is We analysis. have we've same one through tell we for, say give you at is

thing most one we the an making is us can on can be number when the investment, so important our returns identify And that precondition get on will that we investment.

Randall Stuewe

simple. pretty it's think I And

here, gallons the that contemplated. green global talk SAF market, X Europe X.X billion capacity ourselves that been number made see optionality is And the pause outweigh at venture been, the pasture, for about let's make that giving billion, sure it's We the far the day, billion in or into whether said. has the in X been let's the it's and that as even John develop, we real. of adding we're that's starts believe think or horizon SAF, promises it's demand Clearly, to end or four have in it's whether the new anybody US any believe I next real. or arbitraging

be, not was is looking help make to us said, will then and at if And of set I move decision I thing there's told the anybody. a step the enough I have was number now number SAF at starting and because want know any that potentially, Sandy, we you guys we're sure John I We clearly, will to So day, and the as war. we're next four. one to future. is clearly go there, of this very we for in market see nicely feedstock develop such believe that decision the going it world true, would likely that Clearly, the an on before that can demand the and four. in feedstock think number that Charles St. would that's drive four. and to And unit precede waiting at in guilty as number forward I the SAF end the which -- was believe now two be I most SAF larger that would to

Paul Cheng

The in for ask just short quarter guys beginning the versus I see interest you a interest first? question real the what did John. going exercised, the rates, Can incremental of we second are there, quarter? exercise to you other at the expense In words

John Bullock

first quarter done, the at was of end of that conjunction the with Paul, Gelnex. the in Yes, right funding

There the So [Multiple no interest… that Speakers]. was from effect

Randall Stuewe

in that. savings QX interest from No

Paul Cheng

versus the what's first this from impact quarter second quarter swap? the So

John Bullock

Interest expense, then million increase But savings debt have we there $X.X there. obviously, there. be will a

about full for saying still the we're million expense. So interest year, of $XXX

Operator

The of from Matthew Tudor, is next Pickering Blair Holt. question

Matthew Blair

EBITDA translate wanted from shaping QX. to a contribution? to just results. or to strong maybe Was EBITDA follow second I on margin gallon, total up comment, on the on is like per of step-up record. looks Randy, your volumes so would $X.XX quarter on total that $X.XX, the If DGD congrats it's quite it up a EBITDA, roughly that be an

just I to… wanted So

Randall Stuewe

shipments gallons I little guidance $X.XX into of $X.X But billion what being maybe more, gallons with boats. timing that's now and divided between a the saw produced, now clearly million February. and earlier in $X. by running XXX somewhere gave mean, depending are on four kind Yes. should of being clearly, we we and clearly, coming the the of The for margins system X.X year, year

can to So too capture that, early want there? throw say. we you Sandy, anything what to it's

Sandra Dudley

what we're would in seeing saw that, is obviously, the we first I thing than cost only feedstock The quarter. lower say

can so to can push unit John they running see we'll units continue do. had as running As our hard they're Randy to we mentioned, are full and those as what and very well,

those a combination So it's things. I think of

Operator

to we Blair's Mr. will Kallo Baird. I move connection, Ben on Unfortunately, of lost have so

Ben Kallo

think early on out discussions as game. a in how is SAF, But I of too about you plays term Randy, that commercial sales just it's discussions, know or the you it long early could kind agreements, and tell? talk to

Sandra Dudley

investment of talking were before We've a and decision. made talking parties, even actually we of to been a number number parties we to our

make to will don't to I that. do and set when any coming closer that be we're stone, we're to think anything agreements. for we it continue We online in ready probably

But SAF. important always we're of Inflation Reduction we're make spurring us now, is about to the we no terms continue both. what move in seeing was talk would, in premiums the talked and parties Act In to agreements, seeing now, to really a to very the we right we range positive. to of we've particular that have wide And so we thought decision that's

Randall Stuewe

move will do procurement then 'XX. I mean into And over move team the clearly, we commercial spill US have that market is is rapidly decide, to led developing, as by later early European the going a now. into It 'XX, promises to out the sell bit But clearly, on you and lot have or the there then yet. all build more second there's been right plant. decision little sell a to to now, realized of than it, more

it. So we're about excited

Ben Kallo

blenders tax QX shake to guys credit you into translate for the goes out and think it want to new there? difficult. and Diesel, would you or looked just we Randy be for some if it, of margins do are need I after IRA. Where for Diamond in Green however margins we might QX But program then what you So math, the they it at

Sandra Dudley

think look on P&L, yet. change income at that know. offset an tax. don't our going to things don't looked I we how that quite going be it's I to that because to we've think It's

start that at P&L at a bit so you're probably EBITDA maybe little than to our to EPS going there's rather and that And looking more on focus a think have I differently time.

Ben Kallo

come what the Crush I online, question about about better does and facilities maybe if guess, stranded online the about impact What's Randy, the when coming that the you RVO hope online. stranded to feedstock. business? for talked your do risk, come that facilities I that core crush But makes renewable risk that the crush facilities. diesel don't plants sense. you? the market, is how end

Randall Stuewe

going each I clearly, can't completely that break not going numbers of even in to last don't is soybean in a know of been bit out know, just built be, of question lot so seen and to stay say by it seed, on totally process the Canada they instead in have was two I grow years, know facility capacity. that questions belief we've the only canola be Quincy, renewable do pre-treat you out Illinois the know America finished I has never oil the there, here, the instead of unanswered It there all soybeans, online. probably I that a There's more, need it, and refined arbitrage The amount get them of on super I do refined Chinese happen want the we're think do soybean years be, in forms. There's they buy interdependent I'll China. that's And I don't form palm what's we're of crushed or years, do protein soybean And oil? crude predominantly would little you do if ADM. get those XX soybeans underneath bleach? I demand other. to don't was while about of ultimately, how One of crushing away it, do five apart, Remember, lot. whether crushed much beans capacity or or or the just degum coming diesel would the to mean oil don't here. the US, raw bleach takes headed a -- is crush oil to North they're to built with been to you from that

country. the won't So be for business margins beans the or doesn't anywhere skeptical then you that out to moving is are oil then anything point because these moved collapse to add? going have which of, crush pre-treatment out will the to the the if it for to country work go there the of that want go, we're guys, of to be John, soybean

John Bullock

in exactly is the that's fact States. mean every matter soybean crushed was the capacity the right. in before crushing the had world think I United No, of the tremendous we in I increase

adjust. that to there. our those standpoint of to lot question expansion to and the that world facilities out all From of should our process, we able soybeans always a be model, the something was we need up raise occurring business more to for with soybean So filled about be was around a

Randall Stuewe

Ben, other I you to is, like I soybean all guys' on be all it up then and out the is much capacity said, -- got your reports that and will I believe some. how oil use very, mean, quickly thing if very sell-side there,

unchartered canola to mean for boatloads or but that's past. here other the of soybeans consumer buy, in been very clearly that one it's these I comfortable you So kind and international an of got buying are waters the

Ben Kallo

business. know going part collagen because line? just the forward we're know there? expectations bit top just and become just you I you could about a you one And Could is in. view then a year, how this but little sneak over, on bigger to not profile, the Gelnex, And of but as to growth you talk rate, the margin run I the go talk about

Randall Stuewe

with and rate great a procured, with with of. met in we're great business and confident the we of XXX% and Gelnex that supports Darling Clearly, business run team great an a I'll tag criteria assets, we're the this the management accretion team of what John. proud comfortable model

be the going to as now within nice one be and [indiscernible] a to They Brazil, how move in here all learn product and interesting sometimes there. and there's their while the to standpoint going accept, done What's customers, lot overlap their us our to in business, at Indiana, one four the team from Portage, pharma slide, they are and peptides, we for that; product leader over model a quality and Paraguay improvement; the we than then that's leader time. have of the with in adjusting as they of to out from don't ultimately, number a with to lower in the and and system a to really than are of didn't so them. ultimately, of have cost collagen ready the add? to from we've probably of next we the the hard and lot are volume customer and earnings with confectionery one we integrated one, that's in Clearly, operating anything facilities in some And product And have there. of peptides want we look And two is greatest have plan collagen in we do were see the three, are. number and out So to portfolio basically base growth four any Suann kind collagen get my those there. products two, And stories of call growth; here our of margin gelatins that it? you have launch number slowing one in margin Brad peptide years. John, for and seen paid been I year, have. charts that year what people, mix a we told marginally little three earnings And on we've you've we better

John Bullock

going in and obtain oftentimes for think what have with gelatin products looked are collagen demand what's and low products natural Fuel or high premium going the on thing associated frankly, that. are can overlooked margins, of These both We're I excited high benefits the is either the side on. hydrolyzed is profitability excellent, about those, the and that the future we a that's on Same margins there the products is see renewable space, we excellent, Food to be excellent and good that focus at really value we exactly sell we value And excellent the that systems, quite when that great collagen to collagen. we in business. we side on saw into with be that role in the segment those product. CI translate going very of the to diesel

Operator

from Investors, Inc. Bancroft GAMCO will question come of next Tony The

Tony Bancroft

the great on Congratulations quarter.

at Diamond just X? SAF in either Randy, a run in how for could run, of a And can on you I you been potentially an if you that. you try but through past, us from or sort is one a maybe sort talked is Diesel? and a spot it it, us some a I this of demand about rate, realize Maybe capacity. what sort sweet understand you you've there the about Diamond has what least And either How as rate look end, the value, see Green and want terminal mean sort home this? is or give investor, talked if this? -- think walk Green how remind those, these changed. maybe comments mean, of for can those, demand. on you both variables, if growth the at maybe just anything to sort I You've I of every so there constraint -- there us using to Diesel a you of view, you regulatory could the update just whatever be much at want of of of -- is of there obviously, is, you the then year But overall has lot XX,XXX-foot do demand, a And to of, maintain call sort

Randall Stuewe

and potential trying global sweet demand, global last it's think of becoming transparent been understand fair the there? kind want over spots you and clearly more increasing that's some Yes, couple I years. of to Clearly, for enough. give do to the improving, Sandy,

Sandra Dudley

So number going be there it, things of are to there's about think time biofuels. as in I think no better a that And I on.

would is also add to talked bit more they're scoping about mandate for within CARB potentially stringency a in So first plan, we've us. and this of a it great. increase the looking all, call, which the just state, looking of demand that They're and little earlier jet be to plan. potential That's

are now have that looking states programs. of at number LCFS We a

for jet obligation We a LCFS have potential British in Columbia.

we're fuels, I that SAF globally even so passed, the the may recently, being think for think that that various in seen mandates that maritime on in And now side, have things I and within these more type are for then some we cetera, seeing non-LCFS et like SAF, and we're Europe, seeing states there. states. are credits tax we've

there's Illinois, in passed. have you one So in now been that's Washington one

so cetera, creating just demand, much products et that that more more supply the chain, there's dollars So makes is possible. these adding to

And within much seen so I haven't industry. excitement ever our this

Randall Stuewe

it's those Tony, of one things.

I and world, slowing. or the some -- thing It the inflation the the world. came sit in take period. headwinds is strong when but to under not darn they're always a whether seen the through good at pretty a you that small assets mover one do three around yet commitment the But we've say SAF or looking serve world, You're decarbonization we trajectory the next billion through include if the being know what the to came X% was goes of pretty We and located I and first on we California SAF. in they confident as the and of We and if the you it to tone they pretty talking you're unwavering X% makes around there. that whether actually know SAF years, but production XX LCFS and Europe. know wonder end creates rescoping mandates, set it in the the here they our US demand. clearly yet, year to world is to really by for stays seem demand's gallons, And X% so ultimately, and five there going don't and market, the But and with us feel best demand, out a feels the it kind the X%.

Tony Bancroft

advantage? are follow-up competitive beat guys I said have look end. the mean it. best moat that? best, there a -- transformational moat how name just the to up you you wake just that there be could the you there sort you on at is the that you what too cause asset And day, the would something your deep? out of you you too every Is CI, I guess deep, input, cost, how you less do just on I mean, at Is you do as compete

Randall Stuewe

the the the a an buy against against at or day RIN credit people you're always choice of when or in world. like produce imperfect carbon we sense, and of said potentially careful questions economics of perfect unknown competing be And produce about clearly form is I credit, always confident. in or LCFS in a produce a either -- end and we've think a gallon in analysis a the that the day, very I one or or mean, I not feel fuel, I we compliance. ago, to be the always unintended the here. I have offset competing challenge this those with -- years of gallon to don't may really

you when what So they than avoidance compliance people uneconomical say profitable if to it's diesel they do plant, awake their keeps were things and night, how about costs. of rather say me talked renewable at in you

that's I And you Sandy, now. call of want I'm offsetting what But generic see to SAF to the ultimately, the world RD thing. around way of anything so commodity producers the the only add? side going anything

Sandra Dudley

mean, I Green, think taken It's kind a market and excited is at I progression it, think in you of I Randy. Diamond think huge. hit next the we've the that SAF. I step the about we're really

Tony Bancroft

again, sort you I years about term? evolve? see how years look from leader a lastly, you Valero. guess you guys term, industry best-in-class. with this other partnership that do now, what I the Long in And partnership five your and you're dividend, still does at the in you talked Valero essentially being and -- XX of but a with you now, Valero bought how every long energy from But and mean have, majors

John Bullock

the Valero. excited relationship the be guy. a tremendous He's Diamond sitting has for a Lane Joe Green see a We with Diesel have several We Obviously, folks last our years. were Joe. great to named for Board been as with very relationship at a on great replacement him and

the throughout relationship Valero is fabulous. Our organization

as Diamond petroleum to the thing -- the industry how in terms marriage last, the respect is a said, and this married it's at folks. with people Green love I've biggest We how of industry the Valero, have deep and ag we that and the is work bone I the the time them fabulous think get out a figured really how miracle we those Diesel always marriage have with them. that's of that's first

see So just we relationship fabulously. moving that forward

Operator

question comes from next The Stephens. Ben of Bienvenu

Ben Bienvenu

the on solid obviously, integration one quick there. on a Valley, progress making Just

realization the it You business, fat had backdrop really like even in dipping Feed temporarily in pricing what the strong of seems prices.

you is going to by what of forward? fat things and selling that Green you there of Can what increasing process values about XQ Diesel. and to about have in the there Diamond might been One talk are contribution realized where is talked you incremental kind contribution

Randall Stuewe

I we the we're we Eastern that. quality a think clearly road I the of the challenging Seaboard health than going challenging doing from and staffing. We're mean wellness looking one business I look have Well, and reliability was down I in But clearly we're for or fail? the integration within at clearly, no that's a would has are really equipment. you going in things and factory. expensive investment of had most past a The Overall, there. because do more week we're Valley we've been people, those when to you attrition do our When takeover critical that that the that having keep last comes time us as cost hoped. the as day you do of on people completely on a we want have business, benefits was and there and you running and anniversary. within people to those celebrate run raised and in say to standpoint points XXX that What you year Valley to you system mean, better capital over at start when good departments to got we've bigger provide the hours underway to run person the a year or and been mean, I form fail. kind of maintenance. worked the you that, lot transparent maintenance lot one.

have So as that. you to reliability, you don't have increase

happens what doesn't upsets next capacity, have then they transport the to And you causes you entire And by to to You it plant, bad plant. the gets plant. next very third you the uptime. but good down? Now transport material the next and have have it the else time it break wastewater And it to system. really if better it's not then plant the when

the I has, it’s it effect properly. culture, have of to how won people that's part dominos think operate part just domino the of part investment, the of And we here. battle So with it's teaching

in same that's grains produces side, and and proteins my on other So we produces And side of oilseeds move and produce, yield. feel to ultimately, gone never I've product in and seen the pounds yielding and And lysine less then especially a fats. what's less they've the fat the that feeding of career very poultry where interesting lower rendering but it it feed seen that meat the kind in of good. on guy, the out door, the form we've the an animals, of more

And were had in second as our the we've 'XX in we to and had agreements and it on seven return will to supplier. be through a XX, that were per that's there's made that's put being days? they due them flowing more ultimately, capital rendering to start material why test back make And at X,XXX like and deployed about to that in And probably every looked contracts that. a to reliability. 'XX adjustments then some go we've adjustments where So March raw And provide quarter. on then we Because going place, and of contracts complete. that we're said, done come get fair two in for to the scale those the

So the along I complete other of in year. we're near here I couple mean, than a and as said think my far material be we pretty the agreements of raw we'll towards end comments, earlier

Operator

The next question comes from Jason Gabelman of TD Cowen.

Jason Gabelman

you I and and integrate ingredients business just after wanted Gelnex the particularly in about Valley fully to Protein, ask FASA. growth, the core

is a You're for open you've couple have that materials the is the And sheet the still the organic of wondering potential M&A investing raw in previously mentioned back out there available what business, over feedstock thought. than Does growth once so up target the level? I'm what more next balance potential there's you to years?

Randall Stuewe

meaning we to at that global the model transportation the I logistics, our looking acquisitions optimizing followed look And we did and when 'XX then, lowering 'XX, in did if mean will, we cost. if with back the you clearly, footprint. the up we

to right by suppliers. obligation two an low grow remains to Two, that things. have in One, have system the plants sure make our the we having place. with we So cost

in think are We in starting major we'll August, -- be expansion Turlock, of I California. in up, the a process

new in seaboard looking plant permitting We today, Boise, of on couple have two Nebraska. We're of in the Europe, or another We've going process Idaho. up. in we've US. a in process plant two of with a starting at one or second green of We're brand rendering energy line plants the I on a got going in Brazil and plants the got Eastern going the expansion potential another in expansion in think into more

visibility organic out look capital. not moment the pricing, for transparent from balance when of an in do once of Diamond the average there, to We our in now invest at Diesel sheet and what to there, decisions, to we through and time. the we think make it's years. once So next investment globally, you doing as I get has cycles. day, And -- once five been we we Green and very, very how world the the have the we're XX-year build end two strategy said, always at the have But one

adequate as And side, the Valley And continue eastern two, Green our customers. customers didn't support capacity ultimately, that's maintain build feedstock grow thing to out going to were growing. we're and was with so on do one system, Diamond to their the

got there, to plan. that’s work some capital our we’ve do but So in

Jason Gabelman

number just thoughts EBITDA You from years of And but next to the contribution total growth? total number them the meal], that plants? on any and over couple the what's kind clarify, organic of of discussed [piece

Randall Stuewe

I don't know.

this off to hesitate of at EBITDA plants. think time and X what six until see time starting an rattled I or seven, give I'd is. them probably I -- or I where with

to we'll that. you on back So get

Operator

Lewis And next, Baldwin of we Anthony William Securities. Baldwin have

William Baldwin

what your of one has if the is transit been ban protein to quick Just as the could get important of feel, exports, I growing, wanted of business, and out and your coming for how a the as Randy protein that export -- that the protein that level Is here. exports a or that what's to US. prospects the on far markets? I

John Bullock

move it what containers of containers. a move. the So we a component shippers yes, world larger is we of that We're actually one with do. the lot We of container in the

have Asia. So our yes, specialized of some move good proteins markets some a we in lot very, to very proteins of offshore offshore,

component not and of overall on our tremendously Asia excellent It's component. a obviously we it's it's an really And volume, large but demand. our versus excellent, So a excellent a an our volume have in products. network reputation

Randall Stuewe

about But hard. one mean of value -- are mean, to say, I tell are negative And they what very energy. seeing as Valley the to working Europe Asia the network really that's for tend some today. what versus exported into other bought or talk we play destroyed around around. in a green you, I modify today, of helpful been dollar, to with if we plants, be has had -- marketing that's Asia, currencies than in everybody years. strong increased and balance the clearly would years okay, the be you us predominantly I China demand what clearly, to been continues the rules wants to can put we're other proteins bigger we all into

clearly, for market global very years. going in America. wrestle the complex suspect more to earlier, But that's with open opportunities North said have to as to China Asia what proteins to happens And byproducts. So the over animal I up I coming oilseed is going to alternative in

William Baldwin

in Do the added specialized is? markets despite the world proteins, value we in dollar proteins the competitive the where find ourselves

John Bullock

United Europe, States a those as those for Europe, as but out of The the products we world. we're for primary sources lot too, of well move Absolutely.

William Baldwin

to worldwide to this a on So basis grow? it I demand could as guess proteins market is continue then for that be say for Darling could fairly safe secular grows

John Bullock

to very, through period of with the good and be continues We food pet resilient a here inflationary these specialized have demand. the the pet market in a very lot extremely And focus proteins. strong food market

lot a So the demand very good we about feel of very, specialized for profile products. our

Operator

the to any This for question-and-answer turn Stuewe concludes our conference like back I session. over Randall to closing would remarks.

Randall Stuewe

May, for All which Web everybody, We're We'll you. Thanks, attending see right. listed conferences a your our Tony. site. are tomorrow. Thank on Thanks, you more in questions. few

additional that you questions, and Stay out reach to always, you our As safe. have if great any call. concludes day, a much. Suann. Have Thank very

Operator

attending The presentation. today's conference Thank has now for concluded. you

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