Good afternoon, everyone. Thank you so much for joining us. My name is Theresa Chen. I am the Midstream and Refining Analyst here at Barclays. It is my pleasure to introduce our next presenting company, Darling Ingredients. Joining me from Darling is Randy Stuewe, Chairman and CEO, and Bob Day, CFO. Welcome. Thank you. Thank you. Thank you very much for being here. This has been an interesting year for Darling, to say the least. Would love to maybe start on the fuel side of things and ask about your near-term and medium-term margin outlook for the DGD assets. Given high RVOs out to 2027, limited renewable diesel imports, and elevated petroleum diesel prices as a base case, how sustainable do you think the currently supportive margin backdrop is? You want me to take it? You want to start? Okay. Sure. Thanks, Theresa. I think it is sustainable in the near term. We have a strong RVO, a strong mandate, that really provides a backdrop for solid margins. We see it today with the replacement margins in the industry. As you said, that RVO extends through 2027. There are still some details that need to be clarified, but as we go forward, we get more and more. Recently, we learned about small refinery exemptions for 2025. There have been comments and suggestions about reallocations of those. Either way, the S&D balance for RINs is constructive and we think the margin outlook is quite positive. When you look at it, just for those, we are year 13 in the business, largest in the world. The construction investment decision was made off of $0.79 a gallon. First five years, RIN $1.06, $1.07. Second five years, $2.26. Then we had the Biden electric vehicle confusion and not a big enough RVO. Now we are back to more historical numbers that are in those ranges. We have got everything we need to continue the location of the assets, the feedstock origination, the sales, the pathways. It is a sophisticated group of assets that is number one in the world. Got it. Maybe if we just double-click on the RVO and the SRE reallocation, and all the different moving political pieces, to say the least. So what are your expectations as far as timeline goes for the reallocation, and do you expect this to be kind of kicked past midterm elections, and is there much knife fighting to be happening between now and till then? How do you see this process evolving? Well, I think, and Bob can help me here. He is closer to it, so I get to give you the 30,000- ft view. What I can say is, we have worked diligently with our trade associations, both on the ag and the clean fuel side, to be where we are at today. What I can tell you is Lee Zeldin, Andrew Sabin, they have done exactly what they said they would do. The program works. They expanded the RVO. At the end of the day, we have cleaned up some of the SREs, and ultimately, we feel that everything that they have said in the past, they have done. So there is no reason to discount what they are doing right now. Now, we will give you two scenarios. Scenario one is, let us say, no reallocation. It is very constructive. Loosens up the S&D just a little bit, and if they fully reallocate, it tightens it up a little more. So our expectation is that they will issue the rule here in October. Remember, it is a proposed rule. Then we have got to go have comments. Then we have got to respond. The agency has to respond back to the comments, and I think during the RVO, it was 30,000-something comments that came in. Then they have to go to OMB, get White House to sign off on it. So by the end of the year. What is even more fascinating, though, is we talk about the 2026 rule. As long as it is not embedded into the Farm Bill, it is going to be harder to show economic hardship. So 2027 could even get tighter. Yeah. I would just add, I think to Randy's point, we believe that the reallocations will occur, or at least a significant percentage will occur. If they do not, it is more harmful for the farmer and for the oil seed crusher than it is for the renewable diesel producer. The reason is, if we were to not get a reallocation, you could see a scenario where the lesser competitive biofuel producers do not make as much fuel. But then, ultimately, with a lack of production, you are going to tighten up the RIN S&D again, and we get back to the margins that we have today in order to incentivize sufficient production in order to meet that ultimate mandate. We hope that does not happen. We would like to see continued demand for the benefit of the agricultural economy, but we do not think it will have a large impact either way on Diamond Green Diesel. Fair enough. It sounds like just given the multi-step process in codifying this into some sort of formal regulation, the reallocation piece can parlay straight into rulemaking for Set Rule. I think that will be fairly straightforward. It has been litigated in the past and lost every time, so there is no reason not to expect that. That will not be a surprise when it goes out on one of the medias. What is more important to Bob and I right now is that we engage in a discussion now about 2028 forward. Getting the narrative and getting those programs under discussion. As I said, between the EPA, and they have a goal to get that out for discussion here or proposed in November. We will see. It will be the first time that it has happened if they do that, so I am probably going to take a side bet on that one. But I suspect that that is what they are wanting to do. You think of the E15 program, what have we done? We have helped the price of corn, right? We have tightened up the S&D. The price of soybean oil is up at $0.70. It's allowed the crusher to make a nice margin and pay more for beans. The programs are working. There's just no reason a politico is going to take a different spin on it today. Admittedly, you can't take the narrative away from the large oil companies that will make all kinds of claims, but they're having record earnings years. I think it's probably a narrative that probably falls on deaf ears a little bit right now. Fair enough. Given your global footprint, related to this business and this value chain at large, on your last earnings call, as it relates to renewable diesel imports, you highlight that imports have been below expectations due in part to the elimination of PTC eligibility plus tariff-related impacts. What is your updated outlook on imports from here, and how will that impact the domestic margin? Yeah. With this new policy, we did wonder whether it would incentivize more imports, but we haven't seen it. Ultimately, what that allows us to conclude is that with the limited access or no access to the production tax credit and the added cost of logistics to bring imported fuel into the U.S., the margins haven't been wide enough or more attractive than other markets to do that. When we look throughout 2027, we consider demand in other foreign markets, downtime that's projected from other foreign producers. We're not really anticipating a significant change in import volumes as we go through this RVO. When you see oil at the price it is today, I was telling Bob, I said from history here, whenever you see oil tick up above $75, $80 a barrel, you magically see a ton of what I call co-processing in the world. You see palm oil disappear back into the biofuel stream in the APAC countries. You're seeing that right now. You're seeing people say, we shouldn't be so reliant on fossils. We need this. What you're seeing is a really unique situation where the S&D in the world for renewables is very well-balanced right now. The products are staying in the right market. A year ago, they were incented before the PTC or two years ago to come here to get the BTC or generator in. A lot of dynamics have changed over this. When Bob and I saw the RVO come out, proposed and then final in April, we said our one fear was imported biofuels. If Chinese UCO couldn't come into the U.S., it would go somewhere else, be discounted, converted to fuel, and dumped in the U.S. That has not happened, so we feel far more comfortable. Now, it doesn't mean you can't get it out of whack, but as Bob Day says, between currencies, tariffs- Yeah ...and the PTC, and fre ight, it's a far more complicated equation today. Yeah. That tail risk has been mitigated for the time being. To your earlier point, Randy Stuewe, about what's to happen with the RVO in 2028 and 2029, that medium-term outlook. Conceptually, can you help us think about what would be an optimal, sustainable outcome for all parties involved once the wind bank moves into deficit? What do you think is the most likely process from here from a rule-making perspective? You want to take a shot at that? Yeah. First of all, I don't think it's a foregone conclusion that the RIN bank is going to end in deficit. Okay. If we look at June and July's production numbers, markets have a way of responding to opportunities, and we'll see how all that plays out. That outcome will probably have an influence over the size of the RVO in 2028 and 2029. I think what we would look for is some incremental growth. But as we sit here today, it wouldn't need to be significant in order to continue to realize attractive margins through 2029. Clearly the ag lobby. We continue, the productivity of the farm community is incredible, both here and in South America, and we just keep getting better and better. The investment, you've seen the announcements by ADM and Bunge of additional crush capacity. At the end of the day, there's going to be pressure from the ag community to keep growing this. Right now, this was a big leap of faith between the 2024 or 2025 and where we're at today. The industry responded. So there's no argument that the industry can't respond to the capacity required. Okay. Fair enough. Turning to the base business, would you discuss the outlook for fat prices for the remainder of 2026 and into 2027, given elevated demand from RD operators plus limited fat imports? What do you think are the key risks one way or another on fat prices from here? Bob and I can tag on this. Clearly North America is an island right now. When you wake up, you have a tariff here, a tariff there, while at lunch, we learn there is potential Canadian tariff now that has been put in place. Canadian fats cannot come into the U.S. without a 50% or 60% tariff on it. Do not know if he is going to take a holiday or a pause on that, but okay, so there is more demand for North America. So North America is solid. Two reasons it is solid, one, demand, and two is, for us, it is carbon intensity. Then number three, I would say is that some of our competitors have actually learned with their pretreatment systems now to run animal fats. So that shores that up. Now there is this massive tariff on South America. So Brazil was part of our strategy coming up. Now it has to find a new home, probably Europe or biodiesel. The biodiesel mandate continues to go in Brazil. Then Europe is kind of an operating island. It has got to deal with a little bit of downtime in the Neste system over there for the winter here. But overall, as we were telling people today in our one-on-ones, we have never seen a time, it was an all boats rise or whatever that phrase is. We are seeing the U.S. here, Brazil basically being currency freight and tariff off, and Europe being freight off right now. So very different dynamic than we have seen in the past. So we think that will continue for the year, but we do not see any retracement of fat prices. If you are going to tell me that oil prices are going back to $50 a barrel, then maybe that is a different discussion. But right now, I think it looks pretty solid around the world today. Okay. Yeah, the policy-driven regional dislocations definitely favor the U.S. I hear you on if there is some sort of global implosion on demand sending oil prices lower- Right. ...we would be having a very different conversation and it wouldn't just be a precursor to changes in fat prices. Maybe turning to your food segment, could you discuss the overall strategy surrounding the Nextida line and the strategic rationale behind breaking into higher margin health and wellness markets, and how that's going? Yeah. This one I love. I'm at an energy conference talking about collagen. That's a beautiful thing for me. For those that know the story, don't know the story, we acquired a gelatin company in 2014, about 90,000 tons. We're today about 150,000 tons. About 10 years ago, we introduced a water-soluble pure protein that's known as collagen or hydrolyzed collagen. You guys would know the brand it's sponsoring the US Open right now called Vital Proteins. We were shipment number one. We helped build that brand. We don't own the brand or invest in the brand, Nestlé does, but we helped build that. That was 1.0 of the collagen revolution. Collagen's been identified as a great source of protein for health, wellness, nutrition as everybody has that source for working out and everything. About, I don't know, six, seven years ago, we started down the road of saying, what's in that molecule that's in the blue jar? There's, I don't know, 20-something aminos in there that could be converted to peptides, and that's now what's known as Nextida. We've learned to isolate, concentrate the peptide for a specific health wellness nutrition application. The first product we rolled out was Nextida GC. There's a ton of products. As Suann told me, she said, just go onto Amazon, put in Nextida, and you'll see how many products are really using that ingredient today for glucose control. We had to learn as a company how to do clinical trials. Our first study, I think I was informed today, had like 13 victims or whatever you call them. The CPG companies want a whole lot more. We've had to reinvest in more and more clinicals. We're there, 50- something customers now. These are incubator, accelerator companies that are trying to create products and then hopefully, I suspect their exit is to be swallowed up by one of the big giant CPG companies over time. You'll see here later this winter, you'll see a brain health. That one's really exciting. That's been through multiple years of clinicals showing improved cognitive function. The library has women's health, hair, nails, skin. There's at least another 10 or 10. For the business, why is it impactful? Well, today, if gelatin is a 1x sale, hydrolyzed collagen is 2x-3x better margin, and health wellness nutrition is 7x-11x better. Building mass is just going to take time in that segment. But the supplement, as we tell people, you walk into that, whether it's Sprouts, Whole Foods, GNC, whatever, very confusing. And when it's an unregulated world where you can make any claim you want to make. So we know what the CPG companies want now. They want something. Nestlé announced here a week or so ago they're trying to develop a product line for GLP-1 users. This is one of those things that comes into play here. It just takes a little while to develop. What else you want to add to that? Yeah, just I'd say specifically as far as the strategy goes our plan is to sell this as an ingredient inside and back it with science. So as Randy said, we started out, we did a peer review to prove the effectiveness of secreting GLP-1 into the bloodstream. The second peer review has reinforced that with a larger group. We're doing studies now on body mass index and the impact on people over periods of time, and we're getting really positive results. So as time goes on and we're able to stand behind our product as an ingredient inside these products, and back it with the science, then that is really what should drive sales. Then the category becomes a lot less complicated and noisy over time when the really effective ingredients win at the end of the day. So we're seeing strong momentum with sales and as these studies come out and we're able to back it with science, we expect more. A year ago, two years ago, you could've been at a restaurant, a bar, or whatever. There might be two people in there that know the word collagen. I guarantee you today, a high majority does. As we look at it, we are now being contacted by athletic institutions at college. Instead of having the creatine and the whey bar, they want to add collagen to the smoothie bar. It is really exciting. For us as the pioneer front runner, we got it right. It is exciting times for sure, and the ubiquity of that blue jar, Randy, I understand it well. So much to unpack here. Just zoning in on this path to potential multiple expansion. If we were to lay out the building blocks of how this would happen, clinical trials, some sort of feasible product to mass produce and embed in the CPG companies, then widespread consumer adoption thereafter, what am I missing? What needs to happen for Darling to really realize this multiple expansion within the segment? Look, I think first we need to increase the volume sold with these products. As Randy said, if the margin in gelatin is a factor of one, and these products are a margin factor of 7- 11, as we continue to increase the volume sold and margins increase, EBITDA, total profitability increases, then we'll see how the market responds to that. Today it's still relatively small, but I think pretty quickly here, it's going to start to have a meaningful impact on our results, and then we'll see how the market decides to value Darling Ingredients as a sum of the parts exercise. If we're getting fair value, then great. We'll just continue down that path. If we're not, then we're going to have to consider what's in the best interest of shareholders. Okay. As far as structure goes. Yep. Correct. Understood. When we think about the addressable markets for glucose moderation, brain health, all these things. If you can develop a magical ingredient that is the fountain of youth, cognitive health and thinness, amongst other things, that would be very interesting. The early progress that you've seen, any color to share on that? Yeah. I'll rewind the movie a little bit. The blue jar was a big box sale, right? Then here comes that thing called COVID. So Vital had to re-aim the market into really an online sale, a B2C type of sale. So trying to get these products to market to the consumer has been really an evolution. As we go forward with these other products, it's just going to take a little bit of time to get them there. I'll just tell you, it's going to be exciting. When I look back five years ago, the word collagen did not exist in Asia today. It was fish collagen. We were making it out of Angoulême, France and shipping it because it's kind of like the Louis Vuitton of products to go to China. Now it's all over China. People selfishly or funny-wise, they want to pop a pill and live forever. Collagen seems to be in the fairway for them on that on many multiple applications because it is natural in a sense of it's a naturally extracted animal protein. Now, it won't work for everybody in the world, but that's where it's at today. The rapid acceptance is unbelievable. Europe trailed for almost three or four years. Now Europe's ramping up. Mm. It's very exciting the potential for these products. The near-term outlook, looking at the balance sheet in particular, clearly you've made notable progress on reducing leverage and now expecting to exit 2026 with net debt at or below $3 billion and bank leverage below 2x. Can you talk about the path forward from here? A, your confidence in hitting that target with a few months left in the year, and where do we go afterwards? Yeah. No, I'll take the first half and give him the back half. We are two years behind where we wanted to be, and it was really driven as we have constructed the global platform with the 270 factories in 23 countries or whatever, with the three DGD assets. DGD was built to add value to our fats. We did not necessarily say we want to be in the energy business. That is what it was built for. It has been a massive cash generator for 13 years, but we have reinvested a very high percentage back in the growth of that business. We hit a downtrend in margins after Bob blames me after I did $4 billion worth of acquisitions, and I asked Bob one question, can the balance sheet handle it? And he said, Sure. And I said, now we are going to prove it. So we did, and we are bringing debt down from those about two years later from where we wanted to be. Now we are in the tailwind of the perfect storm of we have got all the assets integrated, they are running well, and DGD has got some really good margins. Our commitment and what we have said publicly is that we aim to get our debt down to below $3 billion. We think we will be close to doing that by the end of the year. At the same time though, we do have the ability to buy back shares if we feel like the market gives us an opportunity to do that, and that is in the best interest of shareholders. So we will approach those two things in combination, but with a real focus on bringing down debt to below $3 billion. That will get our leverage down to well below 2.0. And once we achieve that, then we are in a position to come forward with a little more formal capital planning, and announce that to the market. There are a lot of things that we are looking at. This is all possible because of what Randy said. We have made these acquisitions in the past, we have built these global networks, we have tied them together and integrated them. We have also made the lion's share of the investment that we need to make in Diamond Green Diesel, and so the business is expected to generate a significant amount of cash as we go forward. With that, we can entertain things like a potential dividend program or a share buyback program that is a little more prescriptive. Yeah. As we look forward, and we discussed in our Investor Day, we anticipate generating between $4 billion and $6 billion of free cash between now and 2030. Clearly, the analysts have us at a $2.2 billion run rate this year. I think that's achievable unless the White House screws something up here. I think we'll stay with that as a fair play. It puts the company at an inflection point, and so as Bob said, we have different opportunities for dividend or whatever. For us personally, and for some companies, a dividend is an admission that you're done growing. I want to be clear with everybody, we're not done growing. We're done with large M&A because we own it in the world. We built the platform we want to do. But we are in no way, shape, form, not done growing. We've got to add more gelatin collagen capacity around the world on every continent. We've got 20+ rendering plants on the drawing board to continue to meet meat production in the world. We've got biogas plants on the drawing board in Europe today. So ultimately, what we've set up now is what we want people to understand is the core business is built out now to the point where it can sustain the maintenance capital, interest payment of the company, $450 million maintenance capital a year, and then put some growth money. Then we still have money to buy back shares, put a dividend underneath it, and if DGD hits the ball out of the park any given year, we can do more. So we've got the governors, the DGD over there. Because, ultimately, we could expand our SAF business. We're on a pause right now. That business, it's been a great business. It meets our investment case, and we love everything about it, gives us the RD SAF arbitrage, but there's no reason to put more capital in it today until we see the consumer demand that happens there. But it is truly a fun time for Darling as we go forward. Very clear message. Thank you both so much.