The Company makes limited use of derivative instruments to manage cash flow risks related to interest rates, natural gas usage, diesel fuel usage, inventory, forecasted sales and foreign currency exchange rates. Interest rate swaps are entered into with the intent of managing overall borrowing costs by reducing the potential impact of increases in interest rates on floating-rate long-term debt. Natural gas swaps and options are entered into with the intent of managing the overall cost of natural gas usage by reducing the potential impact of seasonal weather demands on

natural gas that increases natural gas prices. Heating oil swaps and options are entered into with the intent of managing the overall cost of diesel fuel usage by reducing the potential impact of seasonal weather demands on diesel fuel that increases diesel fuel prices. Soybean meal forwards and options are entered into with the intent of managing the impact of changing prices for poultry meal sales. Corn options and future contracts are entered into with the intent of managing U.S. forecasted sales of bakery by-products (“BBP”) by reducing the impact of changing prices. Foreign currency forward and option contracts are entered into to mitigate the foreign exchange rate risk for transactions designated in a currency other than the local functional currency.

At March 29, 2025, the Company had corn forward contracts, foreign exchange forward and option contracts and interest rate swaps outstanding that qualified and were designated for hedge accounting as well as corn option and forward contracts, other commodity forward contracts and foreign currency forward contracts that did not qualify and were not designated for hedge accounting.

In fiscal 2025 and fiscal 2024, the Company’s DGD Joint Venture entered into heating oil derivatives that were deemed to be cash flow hedges. As a result, the Company has accrued the other comprehensive income/(loss) portion belonging to Darling with an offset to the investment in DGD as required by Financial Accounting Standards Board (“FASB”) ASC Topic 323.

In fiscal 2023, the Company entered into interest rate swaps that are designated as cash flow hedges. The notional amount of these swaps totaled $900.0 million. Under the contracts, the Company is obligated to pay a weighted average rate of 4.007% while receiving the 1-month SOFR rate. Under the terms of the interest rate swaps, the Company hedged a portion of its variable rate debt into the first quarter of 2026. At March 29, 2025 and December 28, 2024, the aggregate fair value of these interest rate swaps was approximately $5.4 million and $4.2 million, respectively. These amounts are included in other current assets, accrued expenses, other assets and noncurrent liabilities on the balance sheet, with an offset recorded in accumulated other comprehensive loss.

In fiscal 2023, the Company also entered into cross currency swaps that are designated as cash flow hedges. The notional amount of these swaps at March 29, 2025 was €465.6 million. Under the contracts, the Company is obligated to pay a 4.6% euro denominated fixed rate while receiving a weighted average U.S. dollar fixed rate of 5.8%. Under the terms of the cross currency swaps, the Company hedged its intercompany notes receivable into the second quarter of 2025. Accordingly, changes in the fair value of the cash flow hedge are initially recorded as gains and/or losses as a component of accumulated other comprehensive loss. We immediately reclassify from accumulated other comprehensive loss to earnings an amount to offset the remeasurement recognized in earnings associated with the respective intercompany loan. Additionally, we reclassify amounts from accumulated other comprehensive income/(loss) associated with the interest rate differential between the U.S. dollar and the Euro to interest income. At March 29, 2025 and December 28, 2024, the aggregate fair value of these cross currency swaps was approximately $0.7 million and $22.2 million, respectively. At March 29, 2025, these amounts are included in other current assets and accrued expenses on the balance sheet, with an offset recorded in accumulated other comprehensive loss. At December 28, 2024, these amounts are included in other current assets on the balance sheet, with an offset recorded in accumulated other comprehensive loss.

In fiscal year 2024, the Company entered into corn option and forward contracts on the Chicago Board of Trade that are designated as cash flow hedges. Under the terms of the corn option contracts, the Company hedged a portion of its U.S. forecasted sales of BBP into the second quarter of fiscal 2025. At March 29, 2025 and December 28, 2024, the aggregate fair value of these corn option contracts was approximately zero and $0.1 million, respectively. The amounts are included in other current assets and accrued expenses on the balance sheet, with an offset recorded in accumulated other comprehensive loss.

In fiscal 2024 and fiscal 2025, the Company entered into foreign exchange options and forward contracts that are designated as cash flow hedges. Under the terms of the foreign exchange contracts, the Company hedged a portion of its forecasted sales in currencies other than the functional currency through the fourth quarter of fiscal 2026. At March 29, 2025 and December 28, 2024, the aggregate fair value of these foreign exchange contracts was approximately $3.4 million and $32.6 million, respectively. These amounts are included in other current assets, other long term assets, accrued expenses and other non-current liabilities on the balance sheet, with an offset recorded in accumulated other comprehensive loss.

As of March 29, 2025, the Company had the following designated and non-designated outstanding forward and option contract amounts that were entered into to hedge foreign currency transactions in currencies other than the functional currency and forecasted transactions in currencies other than the functional currency (in thousands):


Functional Currency		Contract Currency
Type	Amount	Type	Amount
Brazilian real	218,553	Euro	34,145
Brazilian real	2,459,943	U.S. dollar	429,592

Euro	37,346	U.S. dollar	40,352
Euro	73,845	Polish zloty	308,945
Euro	10,918	Japanese yen	1,763,824
Euro	33,958	Chinese renminbi	267,043
Euro	16,421	Australian dollar	28,050
Euro	4,247	British pound	3,560



Polish zloty	48,802	Euro	11,639
British pound	204	Euro	244
British pound	274	U.S. dollar	355
Japanese yen	98,499	U.S. dollar	643
U.S. dollar	366	Japanese yen	54,499
U.S. dollar	981,501	Euro	907,990

The Company estimates the amount that will be reclassified from accumulated other comprehensive loss at March 29, 2025 into earnings over the next 12 months for all cash flow hedges will be approximately $9.3 million. As of March 29, 2025, no amounts have been reclassified into earnings as a result of the discontinuance of cash flow hedges.


		Loss or (Gain) Recognized in Income on Derivatives Not Designated as Hedges
		Three Months Ended
Derivatives not designated as hedging instruments	Location	March 29, 2025		March 30, 2024

Foreign exchange	Foreign currency loss/(gain)	$	(287)	$	(656)
Foreign exchange	Net sales	(67)		484
Foreign exchange	Cost of sales and operating expenses	60		(192)
Foreign exchange	Selling, general and administrative expenses	(7,189)		1,481
Corn options and futures	Net sales	—		308
Corn options and futures	Cost of sales and operating expenses	(1,601)		(368)





Other commodities	Selling, general and administrative expenses	(277)		—
Total		$	(9,361)	$	1,057

At March 29, 2025, the Company had forward purchase agreements in place for purchases of approximately $138.1 million of natural gas and diesel fuel. The Company intends to take physical delivery of the commodities under the forward purchase agreements and accordingly, these contracts are not subject to the requirements of fair value accounting because they qualify as normal purchases.