Agribusiness · Ag Processing & Trading
Darling Ingredients (DAR)
Darling's rendering and renewable diesel: FY2025 Combined Adjusted EBITDA of $1,026M, Feed 59.8%, 15.45M MT raw material processed, DGD 1,003M gallons sold.
Selborne Research · · Equity Research Profile
Educational analysis for professional use. This profile is not investment advice or a recommendation to buy or sell any security, and it is not personalised.
Snapshot
- FY2025 Net Sales
- $6,136M
- FY2025 Combined Adjusted EBITDA
- $1,026M
- Feed Segment Adjusted EBITDA
- $614M (59.8%)
- Raw Material Processed
- 15.45M MT
- Diamond Green Diesel Gallons Sold
- 1,003M gal
- Darling's Share of Diamond Green Diesel EBITDA
- $104M
- Leverage (Bank-Covenant Measure)
- 2.90×
- ROIC
- Not published
Business Overview
Darling's profit follows the prices of animal fats and protein meals, not the soybean crush. It renders animal by-products and used cooking oil, separating them into fats and proteins, and sells the results as feed, food and fuel ingredients. It also owns half of Diamond Green Diesel (DGD), a renewable diesel venture with Valero.
FY2025 Combined Adjusted EBITDA was $1,026M. Feed contributed $614M (59.8%), Food $295M (28.7%) and Fuel, including Darling's DGD share, $192M (18.7%). The shares add to 107% because the total is struck after a $(74.6)M corporate line. Net sales were $6,136M: Feed 65.0%, Food 25.2%, Fuel 9.8%. The year was 53 weeks, ending 3 January 2026.
The three segments processed 15.45 million tonnes of raw material: Feed 12.68, Food 1.32 and Fuel 1.45, the last excluding what DGD itself processes. That is the same order of size as ADM's or Bunge's oilseed crush, but merchant labels such as origination and crush do not fit; the value chain guide maps the three segments.
DGD sold 1,003 million gallons of renewable diesel in 2025 at an average EBITDA of $0.21 a gallon across the whole venture. Darling's half share of its adjusted EBITDA was $103.7M. The other $88.5M of Fuel came from its own fuel businesses.
How the Numbers Read
Darling publishes no ROIC, so work from Combined Adjusted EBITDA and its bank-covenant leverage ratio, 2.90×. Net debt was $3,849M (debt $3,937M less cash $89M).
Darling ties up little cash in stock compared with a grain merchant. Working capital was $518.7M, with a current ratio of 1.50×. Inventories were $527.7M, 8.6% of revenue, and a lender will not treat rendering stock as near-cash, as it would exchange-traded grain.
How You Would Value a Business Like This
The method normalises rendering and renewable diesel apart, each on its own driver, before applying a through-cycle EV/EBITDA multiple. Feed's $614M was most of FY2025's earnings. DGD's earnings, $103.7M to Darling in FY2025, move with renewable diesel margins and the government credits paid for low-carbon fuel. The valuation guide shows how to read a company that publishes no ROIC on filed EBITDA and leverage, as for The Andersons.
What to Watch in the Financials
Feed's share of earnings. Rendering spreads set the floor under earnings through the cycle.
DGD volume and EBITDA per gallon. Renewable diesel policy and the supply of waste fats move this line whatever the grain crush does.
Covenant leverage. Net debt and Combined Adjusted EBITDA each quarter.
Raw material volume. How full the plants run sets the unit margin. These tonnes measure a different activity from oilseed tonnes.
Key Risks
Renewable diesel margins. Fuel carries policy and feedstock risk that Feed does not; Darling's Diamond Green Diesel share alone was 10% of Combined Adjusted EBITDA.
Leverage and fuel capex. Spending on fuel capacity adds to net debt of $3,849M, and no liquid grain stock stands behind that debt.
Ag Processing and Trading Sector Primer
A hypothetical merchant crusher and an ingredients processor valued year by year, with the crush recovering to a long-run level and ROIC set against the cost of capital.
- 15 sections, from how a merchant earns to a ten-year DCF and leverage net of readily marketable inventories
- 40 pages
- a merchant oilseed crusher and an ingredients processor, each on the same ten-year DCF
- 2 company engines
- listed merchants, processors and ingredients companies on filed FY2025 figures
- 5-company screen
The Excel model is the primer's through-cycle valuation live across 11 sheets: a merchant crusher tab, with the board crush reverting from its starting point to mid-cycle and working capital funded each year, and an ingredients tab, each running a ten-year free-cash-flow schedule; a valuation summary setting each DCF beside the through-cycle multiple, with the gap split into what the weak years cost and how much more the multiple pays than the cash flows support; cycle scenarios, a crush-margin and ROIC view, a leverage screen with and without readily marketable inventories and two live sensitivity grids. Change the crush, the throughput or the WACC and the value moves.
See what's in the Ag Processing and Trading Sector Primer →£25 PDF · £59 with the Excel model · £159 for all three Agribusiness industries
Learn the Concepts
Understand the valuation frameworks and metrics used in this analysis.
Origination, Processing and Ingredients
The ag value chain from farm origination through crush and refining to specialty ingredients: ADM and Bunge segment maps, and why INGR, DAR and ANDE need different lenses.
Valuing Ag Processors (EV/EBITDA, ROIC)
Normalising EBITDA on a long-run crush, ROIC against WACC, and filed FY2025 returns on capital at Ingredion, Bunge and ADM, each on its own definition.
Ag Processing Margin per Tonne by Segment
Segment profit divided by tonnes, from grain trading to crushing to ingredients: how to work it out, why the profit line and the tonnes must match, and how to convert to bushels.