Darling Ingredients Inc Q3 2023 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Manav Gupta - UBS Investment Bank, Research Division - Analyst : My question first is on a little bit on the macro side. How do you view the recent staff proposal by CARB which increases compliance by 50% by 2030, also has the [AAR] mechanism, which pulls forward the program in case of over generation of LCFS. Do you believe this will be supportive of RD economics once it kicks in 2025?

Question: Manav Gupta - UBS Investment Bank, Research Division - Analyst : Okay. I'm assuming you're basically referring to the fact that the [AAR] will pull forward the program into 2024. So the program could actually start in third quarter 2024?

Question: Manav Gupta - UBS Investment Bank, Research Division - Analyst : Okay. Very quick follow-up is on Slide [11]. You indicate lower fat sales volume were $32 million year-over-year headwind and lower protein sales volume were a $13 million year-over-year headwind. Given that integration is going well for both valley and FASA, should we assume this was just a temporary blip and the volumes will come back as we go ahead?

Question: Paul Cheng - Scotiabank Global Banking and Markets, Research Division - Analyst : Randy, trying to understand sequentially from the second to third quarter, the Feed ingredient revenue is down. The sales volumes is actually flat. And all the market indicators, whether it's UCO, tallow or (inaudible) is actually up. We're trying to understand that what's causing the sequential revenue drop from second to third quarter in the Feed business? That's the first question.

Question: Paul Cheng - Scotiabank Global Banking and Markets, Research Division - Analyst : And so Brad, should we -- based on that means in the fourth quarter, we should see, comparing to the market indicator, your revenue, we see more of an upside or then the lag effect is going to take longer than that?