DEF: Darling Ingredients Sets 2026 Annual Meeting Agenda

Darling Ingredients Inc. announces its 2026 Annual Meeting of Stockholders, detailing proposals for director elections, auditor ratification, executive compensation, and a new incentive plan, alongside a review of its 2025 financial performance.

Summary

• The 2026 Annual Meeting of Stockholders for Darling Ingredients Inc. will be held virtually on Thursday, May 7, 2026, at 10:00 a.m. Central Time.
• Key proposals for stockholder vote include the election of ten director nominees, ratification of KPMG LLP as the independent auditor for fiscal year ending January 2, 2027, an advisory vote on executive compensation, and approval of the 2026 Omnibus Incentive Plan.
• For fiscal year 2025, the company reported net income of $62.8 million, or $0.39 per GAAP diluted share, and a combined adjusted EBITDA of $1.03 billion.
• The company monetized $255 million of its $285 million Production Tax Credit sales in 2025, improving cash generation.
• The bank leverage ratio decreased to 2.90X in 2025, reflecting a commitment to deleveraging.
• A new joint venture agreement was signed with Tessenderlo Group to combine collagen and gelatin segments, requiring no initial cash investment from either company.
• Robert Aspell was appointed to the Board in February 2026, bringing 40 years of global agriculture-based business experience from Cargill.
• Gary W. Mize, Lead Director, plans to retire from the Board effective at the 2026 Annual Meeting.
• The 2026 Omnibus Incentive Plan proposes 3,900,000 new shares for awards, plus any remaining from the 2017 Plan, to attract and retain talent.
• The company's executive compensation program is designed to align pay with performance, with 87% of the CEO's and an average of 71% of other NEOs' annual target total direct compensation being variable and performance-based in 2025.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this filing as neutral to slightly negative. While the company demonstrated strong operational execution in deleveraging and strategic joint ventures, the significant decline in net income and adjusted EBITDA for 2025, coupled with a low relative TSR, indicates underlying challenges. The forward-looking statements are optimistic, but the past year's financial results temper enthusiasm.

Positives

• Achieved net income of $62.8 million and combined adjusted EBITDA of $1.03 billion in fiscal year 2025 despite a challenging operating environment.
• Monetized $255 million of $285 million in Production Tax Credit sales, significantly enhancing cash generation.
• Successfully reduced the bank leverage ratio to 2.90X, demonstrating strong commitment to deleveraging.
• Formed a new joint venture with Tessenderlo Group for collagen and gelatin segments, accelerating growth in the health, wellness, and nutrition sector without initial cash investment.
• Continued Board refreshment with the appointment of Robert Aspell, adding extensive global agribusiness and strategic M&A experience.
• Executive compensation program shows strong alignment with stock price performance and combined adjusted EBITDA over the long-term.
• High stockholder support for executive compensation, with 97% of votes cast in favor at the 2025 Annual Meeting.
• Demonstrated progress towards sustainability goals, including reducing Scope 1 and Scope 2 emissions and producing sustainable aviation fuel (SAF).
• Maintained a strong health and safety program, improving Lost Time Incident Rate (LTIR) and Total Recordable Incident Rate (TRIR) in 2025 versus 2024.

Negatives

• Fiscal year 2025 net income of $62.8 million and diluted EPS of $0.39 are significantly lower than previous years (e.g., 2024 net income $278.88 million, 2023 net income $647.726 million).
• Combined adjusted EBITDA of $1.03 billion in 2025 is lower than 2024 ($1.08 billion), 2023 ($1.61 billion), and 2022 ($1.54 billion), indicating a decline in core operating performance.
• The company's 1-Year Total Shareholder Return (TSR) % was -32.9% in 2024, and 12.5% in 2025, indicating significant volatility and a substantial drop in 2024.
• The company acknowledges a 'challenging backdrop' and 'uncertainties created by evolving renewables public policy' in 2025, impacting performance.
• The proposed 2026 Omnibus Incentive Plan will increase potential overhang by 2.45% to approximately 6.89%.

Risks

• Uncertainties created by evolving renewables public policy can significantly impact performance.
• Deflationary cycles within global commodity markets can negatively impact financial performance.
• Regulatory uncertainty around energy policies and programs can affect demand and price for renewable diesel and SAF.
• The company's unique product offerings and income from disparate industries make it difficult to establish comparable peer groups for performance and compensation measurement, potentially leading to misaligned benchmarks.
• Reliance on the 2026 Omnibus Incentive Plan for attracting, motivating, rewarding, and retaining talent; failure to approve it could necessitate increased cash compensation, inhibiting talent acquisition and retention.

Future Outlook

The company anticipates tailwinds forming across its markets and believes public policy is on the cusp of becoming tangible and beneficial for its business, positioning it at an inflection point for delivering long-term stockholder value in 2026. The 2026 Omnibus Incentive Plan is critical for attracting, motivating, rewarding, and retaining a talented team to contribute to future success.

Management Comments

• "Despite a challenging backdrop, we continued to execute with focus and discipline."
• "Our 2025 performance reflected the uncertainties created by evolving renewables public policy; yet our team remained committed to the fundamentals that matter the most."
• "We prioritized meaningful debt reduction, took steps to sharpen our portfolio and focus on our core strengths, and advanced operational excellence."
• "These actions strengthen our position and allow us to deliver in the areas within our control."
• "We are beginning to see tailwinds forming across our markets, and we believe public policy is on the cusp of becoming tangible and beneficial for our business."
• "We believe we are at an inflection point — one where the foundation we have built and the momentum we have created will move us forward."
• "We are excited about 2026 and believe we are well-positioned to deliver long-term value for our stockholders."
• "As 2025 reminded us, every ending brings the opportunity for a new beginning."

Industry Context

StockSavvy.ai notes that Darling Ingredients operates in a unique position within the agriculture and food industries, transforming waste streams into valuable ingredients and renewable fuels. Its performance is influenced by global grain and oilseed supplies, meat production trends, crude oil pricing, and foreign currency values, often operating in economic cycles opposite to many traditional food or agricultural-related companies. The company's significant investment in Diamond Green Diesel (DGD) positions it as a major player in renewable diesel and sustainable aviation fuel (SAF), making its performance highly sensitive to evolving renewables public policy. The focus on circularity and ESG initiatives aligns with broader industry trends towards sustainability and responsible resource management, differentiating it from competitors focused solely on traditional agricultural commodities.

Comparison to Industry Standards

• The company's executive compensation program targets the 50th percentile of its Pay Levels Peer Group, which includes companies like Celanese Corporation, Clean Harbors, Inc., Corteva, Inc., FMC Corp., Green Plains Inc., Ingredion Incorporated, International Flavors & Fragrances Inc., Republic Services, Inc., Seaboard Corp., Stepan Company, The Andersons, Inc., and The Mosaic Company.
• Performance for long-term incentives (PSUs) is measured by Return on Gross Investment (ROGI) relative to a broader Performance Peer Group, which also includes Archer-Daniels-Midland Company, Bunge Limited, DSM-Firmenich, FutureFuel Corp., Maple Leaf Foods Inc., Neste Oyj, REX American Resources Corporation, Sensient Technologies Corporation, Tate & Lyle plc, and Tyson Foods, Inc.
• The 2023-2025 PSU cycle achieved a relative ROGI at the 63.6th percentile, indicating above-median performance against its peer group, while relative TSR for the same period was at the 32nd percentile, suggesting a need for improvement in shareholder returns relative to peers.
• The company's 3-year average burn rate of approximately 0.33% of outstanding common stock is considered reasonable within industry standards for equity compensation programs.

Management Changes

Corporate Governance

Related Party Transactions

• No transaction has been identified as a reportable related person transaction since December 29, 2024.

Stakeholder Impact

• Shareholders: Direct impact through proposals for director elections, executive compensation, and the new incentive plan. Financial performance in 2025 (lower net income, EBITDA) may concern some, but deleveraging and strategic moves offer long-term value potential. The new incentive plan could dilute existing shares but aims to retain key talent.
• Employees: The 2026 Omnibus Incentive Plan is designed to attract, retain, and motivate employees through equity awards. Changes in executive roles and retirements may affect organizational structure and morale. The company's commitment to human capital management, training, and health/safety programs benefits employees.
• Customers: The joint venture in collagen and gelatin aims to accelerate growth in health, wellness, and nutrition, potentially offering new or improved products. The company's focus on circularity and sustainability benefits customers seeking more sustainable supply chains.
• Suppliers: The company's role in repurposing animal agriculture and food industry waste streams provides a sustainable alternative to landfills for its suppliers.
• Creditors: Deleveraging efforts, as evidenced by the reduced bank leverage ratio to 2.90X, positively impact creditors by reducing financial risk.

Next Steps

• Stockholders to vote on director nominees, auditor ratification, executive compensation, and the 2026 Omnibus Incentive Plan at the Annual Meeting on May 7, 2026.
• Gary W. Mize will retire from the Board effective at the 2026 Annual Meeting.
• The company will continue to execute its corporate strategy, including advancing organizational growth and delivering value to stockholders.
• Ongoing efforts to advance sustainability goals, including reducing Scope 1 and Scope 2 emissions and expanding sustainable aviation fuel production.
• John F. Sterling will continue in a non-executive advisory role until his retirement on March 31, 2027.

Key Dates

Recommendation

The company faces a mixed outlook. While strategic initiatives like the new joint venture and continued deleveraging are positive, the significant decline in net income and adjusted EBITDA for fiscal year 2025, coupled with a low relative TSR, indicates operational headwinds and market challenges. The forward-looking statements are optimistic, but the actual financial results for 2025 suggest caution. A 'hold' recommendation is appropriate as investors should monitor the execution of strategic plans and the impact of evolving renewables policies on future financial performance before making further investment decisions.

Keywords

Darling Ingredients, SEC Filing, Proxy Statement, Corporate Governance, Executive Compensation, Renewable Energy, Sustainability, EBITDA, Stockholder Meeting, Board of Directors, Risk Management, Circular Economy, Diamond Green Diesel, SAF, Production Tax Credit