Darling Q3 profit climbs as Diamond Green Diesel income rises

Darling Ingredients Inc. (DAR) reported third-quarter net income of $267.0 million, or $1.67 per GAAP diluted share, compared with $19.4 million, or 12 cents per share, a year earlier.

Total net sales were $1.79 billion, below the $1.81 billion consensus estimate compiled by Finnhub, and the company reaffirmed its 2026 Combined Adjusted EBITDA guidance of $2.2 billion to $2.3 billion.

The company said in a press release furnished with its Form 8-K on Oct. 28 that the results cover the quarter ended Oct. 3, 2026. Darling Ingredients operates over 260 facilities in more than 15 countries, according to the release.

Here’s how the company did:

• Net income attributable to Darling: $267.0 million, or $1.67 per GAAP diluted share, vs. $19.4 million, or 12 cents per share, a year earlier
• Total net sales: $1.79 billion vs. $1.56 billion a year earlier, below the $1.81 billion expected, according to Finnhub
• Combined Adjusted EBITDA: $514.3 million vs. $244.9 million a year earlier

Here’s how other Darling Ingredients segments did during the quarter:

• Feed: Combined Adjusted EBITDA of $247.7 million vs. $174.0 million a year earlier
• Food: Combined Adjusted EBITDA of $73.8 million vs. $71.6 million a year earlier
• Fuel, including Darling’s share of Diamond Green Diesel: $227.9 million vs. $21.6 million a year earlier

Net sales rose 14.5% from a year earlier, according to the company’s slide presentation.

Feed results were affected by related-party deferred profit accounting treatment from sales to Diamond Green Diesel, which the company expects to reverse in the fourth quarter.

Equity in net income of Diamond Green Diesel, the 50% joint venture, was $165.6 million, compared with a loss of $45.8 million a year earlier.

Nine-month results

For the nine months ended Oct. 3, 2026, net income attributable to Darling was $788.6 million, or $4.91 per GAAP diluted share, compared with $5.9 million, or 4 cents per share, a year earlier.

Net sales for the nine months were $5.1 billion, compared with $4.4 billion a year earlier. Combined Adjusted EBITDA was about $1.7 billion, compared with $690.2 million for the same period in 2025.

Cash, debt and buybacks

As of Oct. 3, the company had $121.7 million in cash and $1.7 billion available under its revolving credit agreement. Total debt was $3.5 billion, and the preliminary leverage ratio under its bank covenant was 1.7X.

Net debt fell by approximately $420 million in the quarter. The company repurchased $75.9 million of its common stock in the third quarter, bringing repurchases through the third quarter to $149.4 million.

Diamond Green Diesel paid Darling $171.0 million in cash distributions in the quarter, including $33.4 million in dividends and $137.6 million from Production Tax Credit sales.

Capital expenditures were $343.5 million year to date, and the company estimates about $450.0 million for fiscal 2026.

2026 guidance

Darling Ingredients reaffirmed its 2026 Combined Adjusted EBITDA guidance of $2.2 billion to $2.3 billion, the same range it gave on Oct. 22. The company anticipates ending fiscal 2026 with net debt at or below $3.0 billion and a leverage ratio below 1.5X.

Chairman and Chief Executive Officer Randall C. Stuewe said the company’s “core business delivered another quarter of exceptional performance, demonstrating its resilience and strong cash flow generation.” He added, “With a strong balance sheet and a great outlook, the momentum is undeniable as we position the company for a successful 2027.”

Net income has risen in each of the last three quarters, from $19.4 million in the third quarter of 2025 to $387.3 million in the second quarter of fiscal 2026, according to its SEC filings.