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3 chemical stocks to play the industry breakoutStepan NYSE: SCL reported higher third-quarter earnings as volume growth, margin recovery and cost savings lifted results across its three operating segments, while the company continued efforts to reduce debt and optimize its manufacturing footprint.

Reported net income rose 64% from a year earlier to $17.8 million, or $0.78 per diluted share. Adjusted net income nearly doubled to $21.7 million, or $0.94 per diluted share, from $10.9 million, or $0.48 per diluted share, in the prior-year quarter.

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Adjusted EBITDA increased 18% year over year to $66.3 million. President and Chief Executive Officer Luis Rojo said the improvement reflected global volume growth, margin recovery and savings from the company’s Project Catalyst restructuring and productivity initiative.

Volume Growth Across All Segments
Organic volume increased 7% companywide during the quarter, with growth in Surfactants, Polymers and Specialty Products. Rojo said Stepan’s three segments each delivered higher earnings than a year earlier despite ongoing economic uncertainty and supply-chain disruption.

Surfactants net sales increased 15% to $487 million, as selling prices rose 10%, reported volume increased 3% and foreign-currency translation added 2% to sales. Organic volume rose 8%, led by double-digit increases in consumer products, construction and industrial applications, and oilfield markets. Lower crop-productivity demand partly offset those gains.

Surfactants adjusted EBITDA rose 27% to $48 million. North America and Asia benefited from consumer products, oilfield and construction-and-industrial volume growth, as well as margin recovery. Latin American earnings increased on double-digit organic volume growth, pricing and margin recovery, while European earnings were modestly lower as softer crop-productivity demand outweighed growth in consumer markets.

Polymers net sales rose 24% to $179 million, primarily reflecting a 22% increase in selling prices tied to higher raw-material costs. Sales volume rose 3%, including double-digit growth in North America driven by rigid polyols, phthalic anhydride and continued expansion in spray-foam products.

Polymer adjusted EBITDA increased 4% to $23 million. North American gains more than offset a regulatory-mandated maintenance turnaround at the company’s Germany facility, lower European rigid-polyol volume and weaker Chinese demand. Rojo said the Germany turnaround created a more than $2 million impact in the quarter, while maintenance costs at a U.S. phthalic anhydride facility are expected to affect the fourth quarter.

Specialty Products net sales increased 12% to $27 million, while volume climbed 20%. Adjusted EBITDA rose 5% to $11.7 million, supported by higher volume in the medium-chain triglycerides, or MCT, product line, partly offset by less favorable mix.

Pricing and Raw-Material Costs
Management said volatile oil and raw-material markets, including disruption associated with the Middle East conflict, continued to pressure input costs. The company said its pricing actions and contractual pass-through mechanisms offset higher costs during the quarter.

Rojo told analysts that the majority of pricing recovery had been completed based on third-quarter oil prices, although Stepan was still making adjustments in certain areas. He said the company’s year-to-date margin profile was improving, citing double-digit EBITDA margins in Surfactants and EBITDA margins of roughly 13% to 15% in Polymers.

Rojo also said demand in Europe and China remained a macroeconomic challenge for the Polymers segment. However, he cited potential longer-term demand in Europe for energy-efficiency improvements in buildings, where the company’s products are used.

Project Catalyst Savings Ahead of Plan
Project Catalyst generated an approximately $23 million quarterly savings run rate in the third quarter. The company said it now expects to exceed its target of achieving 60% of a two-year, $100 million pre-tax savings objective during 2026.

During the call, Rojo said the company expects 2026 savings from the program to reach roughly $66 million to $70 million, above the prior $60 million expectation. He added that Stepan expects average quarterly savings to exceed $25 million in 2027, with further benefits expected as the Pasadena, Texas, facility continues to ramp production and other projects are implemented.

Through September, Stepan recorded $76 million in pre-tax restructuring charges related to Project Catalyst, with a year-to-date cash impact of $13 million. Third-quarter reported results included a $5.6 million pre-tax restructuring charge tied largely to the planned closure of the Fieldsboro, New Jersey, site, asset decommissioning at Millsdale, Illinois, and Stalybridge, United Kingdom, and a global salaried workforce reduction announced in July.

Cash Flow, Debt Reduction and Outlook
Cash flow from operations before working-capital changes totaled $49 million in the third quarter. Free cash flow was $8 million after $21 million in capital expenditures, a $32 million working-capital build and $6 million in restructuring-related cash payments.

Net debt ended the quarter at $536 million, and the company’s net leverage ratio improved to 2.4 times from 2.7 times a year earlier. Rojo said Stepan completed the sale of a parcel of land near its Millsdale site in October for $28.5 million and plans to use the full cash proceeds to pay down debt in November.

The company also paid $9 million in dividends during the quarter and raised its quarterly dividend by $0.01 per share, or 2.5%. Rojo said the increase marked Stepan’s 59th consecutive year of dividend growth.

For the first nine months of 2026, adjusted EBITDA increased 15% and adjusted earnings per share rose 40% from the prior-year period. Management said it expects full-year adjusted EBITDA growth, positive free cash flow and continued deleveraging in 2026.

About Stepan (NYSE:SCL)Stepan Company NYSE: SCL is a global manufacturer of specialty and intermediate chemicals. Founded in 1932 and headquartered in Northfield, Illinois, the company develops products used by manufacturers in consumer and industrial markets.

Stepan's principal products include surfactants, which are used in detergents, cleaners, personal-care products, agricultural formulations and other applications. The company also produces polyurethane polyols, phthalic anhydride and other specialty chemicals used in insulation, construction materials, coatings, plastics, food packaging and related industrial products.

Stepan serves customers across North America, Latin America, Europe and Asia through a network of manufacturing facilities, research and development operations, and sales organizations.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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Stepan Co. (SCL - Free Report) came out with quarterly earnings of $0.94 per share, beating the Zacks Consensus Estimate of $0.73 per share. This compares to earnings of $0.48 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of +28.77%. A quarter ago, it was expected that this specialty chemicals company would post earnings of $0.61 per share when it actually produced earnings of $1.18, delivering a surprise of +93.44%.

Over the last four quarters, the company has surpassed consensus EPS estimates three times.

Stepan Co., which belongs to the Zacks Chemical - Diversified industry, posted revenues of $692.15 million for the quarter ended September 2026, surpassing the Zacks Consensus Estimate by 9.12%. This compares to year-ago revenues of $590.28 million. The company has topped consensus revenue estimates two times over the last four quarters.

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

Stepan Co. shares have added about 37.7% since the beginning of the year versus the S&P 500's gain of 12.8%.

What's Next for Stepan Co.?While Stepan Co. has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Stepan Co. was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.34 on $608.75 million in revenues for the coming quarter and $2.69 on $2.53 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Chemical - Diversified is currently in the bottom 18% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

One other stock from the same industry, Air Products and Chemicals (APD - Free Report) , is yet to report results for the quarter ended September 2026. The results are expected to be released on November 5.

This seller of gases for industrial, medical and other uses is expected to post quarterly earnings of $3.60 per share in its upcoming report, which represents a year-over-year change of +6.2%. The consensus EPS estimate for the quarter has been revised 0.4% lower over the last 30 days to the current level.

Air Products and Chemicals' revenues are expected to be $3.32 billion, up 4.8% from the year-ago quarter.

, /PRNewswire/ -- Stepan Company (NYSE: SCL) today reported:

The Board of Directors of Stepan Company has declared a quarterly cash dividend on the Company's common stock of $0.405 per share. The dividend is payable on December 15, 2026, to common stockholders of record on December 1, 2026. The Company increased its quarterly cash dividend in the fourth quarter of 2026 by $0.010 per share, marking the 59th consecutive year that the Company has increased its cash dividend to stockholders.

Corporate Profile

Stepan Company is a major manufacturer of specialty and intermediate chemicals used in a broad range of industries. Stepan is a leading merchant producer of surfactants, which are the key ingredients in consumer and industrial cleaning and disinfection products and in agricultural and oilfield solutions. The Company is also a leading supplier of polyurethane polyols used in the expanding thermal insulation market, and CASE (Coatings, Adhesives, Sealants, and Elastomers) industries.

Headquartered in Northbrook, Illinois, Stepan utilizes a network of modern production facilities located in North and South America, Europe and Asia.

The Company's common stock is traded on the New York Stock Exchange (NYSE) under the symbol SCL. For more information about Stepan Company please visit the Company online at www.stepan.com.

More information about Stepan's sustainability program can be found on the Sustainability page at www.stepan.com.

Certain information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include statements about Stepan Company's plans, objectives, strategies, financial performance and outlook, trends, the amount and timing of future cash distributions, prospects or future events and involve known and unknown risks that are difficult to predict. As a result, Stepan Company's actual financial results, performance, achievements or prospects may differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by the use of words such as "may," "could," "expect," "intend," "plan," "seek," "anticipate," "believe," "estimate," "guidance," "predict," "potential," "continue," "likely," "will," "would," "should," "illustrative" and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by Stepan Company and its management based on their knowledge and understanding of the business and industry, are inherently uncertain. These statements are not guarantees of future performance, and stockholders should not place undue reliance on forward-looking statements.

There are a number of risks, uncertainties and other important factors, many of which are beyond Stepan Company's control, that could cause actual results to differ materially from the forward-looking statements contained in this news release. Such risks, uncertainties and other important factors include, among other factors, the risks, uncertainties and factors described in Stepan Company's Form 10-K, Form 10-Q and Form 8-K reports and exhibits to those reports, and include (but are not limited to) risks and uncertainties related to: our ability to realize cost savings or operating efficiencies associated with strategic initiatives, including Project Catalyst; risks related to restructuring activities, including the execution of facility closures and asset, decommissioning, potential operational disruptions, impacts on employees and local, communities, and environmental compliance; accidents, unplanned production shutdowns, interruptions or disruptions in manufacturing facilities; reduced demand due to customer product reformulations or new technologies; our inability to successfully develop or introduce new products; compliance with laws and other legal restrictions, including those relating to the international scope of our business; domestic and global competition; volatility of raw material and energy costs and supply; disruptions in transportation or significant changes in transportation costs; downturns in certain industries and general economic downturns; international business risks, including changes in global trade policies, tariffs, and retaliatory measures and countermeasures; currency exchange rate fluctuations; changes in tax policy and potential adverse tax consequences due to the international scope of our business; downgrades in our credit ratings or our ability to access the credit or capital markets if and when necessary; global political, military, security or other instability and increased security regulations; costs, delays and miscalculations in capacity needs related to expansion or other capital projects; interruption or breaches of information technology systems; unfavorable resolution of litigation against us; maintaining and protecting intellectual property rights; our ability to identify suitable acquisition candidates and successfully complete and integrate acquisitions; our ability to retain executive management and key personnel; and issues relating to compliance with our debt covenants.

These forward-looking statements are made only as of the date hereof, and Stepan Company undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.

SOURCE Stepan Company

Shares of Stepan Company (NYSE:SCL – Get Free Report) crossed above its 200-day moving average during trading on Wednesday. The stock has a 200-day moving average of $57.07 and traded as high as $62.22. Stepan shares last traded at $62.0950, with a volume of 97,167 shares.

Analysts Set New Price Targets Several analysts have recently weighed in on SCL shares. Wall Street Zen upgraded shares of Stepan from a “hold” rating to a “buy” rating in a research report on Saturday, August 8th. Weiss Ratings upgraded shares of Stepan from a “sell (d)” rating to a “sell (d+)” rating in a report on Wednesday, July 29th. Seaport Research Partners reaffirmed a “buy” rating and issued a $85.00 target price on shares of Stepan in a research report on Friday, August 7th. Finally, Zacks Research upgraded shares of Stepan from a “hold” rating to a “strong-buy” rating in a research note on Tuesday, September 29th. One investment analyst has rated the stock with a Strong Buy rating and one has assigned a Sell rating to the company. Based on data from MarketBeat.com, Stepan presently has an average rating of “Moderate Buy”.

Read Our Latest Research Report on SCL

Stepan Price Performance The stock has a 50-day moving average price of $62.89 and a 200 day moving average price of $57.07. The company has a debt-to-equity ratio of 0.20, a current ratio of 1.15 and a quick ratio of 0.77. The firm has a market cap of $1.41 billion, a price-to-earnings ratio of -517.46 and a beta of 0.94. Stepan (NYSE:SCL – Get Free Report) last posted its earnings results on Wednesday, July 29th. The basic materials company reported $1.18 earnings per share for the quarter, beating the consensus estimate of $0.61 by $0.57. The business had revenue of $684.11 million during the quarter, compared to the consensus estimate of $635.85 million. Stepan had a positive return on equity of 3.90% and a negative net margin of 0.11%. The business’s quarterly revenue was up 15.0% on a year-over-year basis. During the same period in the previous year, the business earned $0.52 EPS. As a group, equities research analysts forecast that Stepan Company will post 2.69 earnings per share for the current fiscal year.

Stepan Dividend Announcement The company also recently disclosed a quarterly dividend, which was paid on Tuesday, September 15th. Shareholders of record on Tuesday, September 1st were paid a $0.3950 dividend. The ex-dividend date was Tuesday, September 1st. This represents a $1.58 dividend on an annualized basis and a yield of 2.5%. Stepan’s payout ratio is currently -1,316.67%.

Institutional Investors Weigh In On Stepan Large investors have recently modified their holdings of the company. O Keefe Stevens Advisory Inc. raised its holdings in shares of Stepan by 4.1% in the third quarter. O Keefe Stevens Advisory Inc. now owns 99,461 shares of the basic materials company’s stock valued at $6,204,000 after buying an additional 3,901 shares during the last quarter. Farther Finance Advisors LLC boosted its stake in shares of Stepan by 194.8% during the third quarter. Farther Finance Advisors LLC now owns 395 shares of the basic materials company’s stock worth $25,000 after buying an additional 261 shares during the period. Core Capital Management & Research inc. acquired a new stake in shares of Stepan during the second quarter worth about $2,670,000. Integrated Wealth Concepts LLC purchased a new position in shares of Stepan during the second quarter worth about $85,000. Finally, Squarepoint Ops LLC purchased a new position in shares of Stepan during the second quarter worth about $283,000. 82.70% of the stock is owned by institutional investors and hedge funds.

Stepan Company Profile (Get Free Report)

Stepan Company (NYSE:SCL) is a global manufacturer of specialty and intermediate chemicals. The company produces surfactants, polymers and specialty products used in a broad range of consumer and industrial applications, including household and institutional cleaning, personal care, agriculture, food, construction, automotive, coatings and insulation.

Stepan’s surfactants are used as cleaning agents, emulsifiers, dispersants and wetting agents in products such as detergents, shampoos, agricultural formulations and industrial cleaners.

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PureCycle Technologies (NASDAQ:PCT – Get Free Report) and Stepan (NYSE:SCL – Get Free Report) are both small-cap materials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitability, earnings and institutional ownership.

Profitability This table compares PureCycle Technologies and Stepan’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets PureCycle Technologies -1,618.84% -612.39% -22.08% Stepan -0.11% 3.90% 2.01% Valuation & Earnings This table compares PureCycle Technologies and Stepan”s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio PureCycle Technologies $8.35 million 96.48 -$182.57 million ($1.46) -2.75 Stepan $2.43 billion 0.58 $46.90 million ($0.12) -520.57 Stepan has higher revenue and earnings than PureCycle Technologies. Stepan is trading at a lower price-to-earnings ratio than PureCycle Technologies, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations This is a breakdown of recent ratings and target prices for PureCycle Technologies and Stepan, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score PureCycle Technologies 1 1 1 0 2.00 Stepan 1 0 0 1 2.50 PureCycle Technologies presently has a consensus target price of $11.75, suggesting a potential upside of 193.02%. Given PureCycle Technologies’ higher probable upside, equities research analysts clearly believe PureCycle Technologies is more favorable than Stepan.

Risk and Volatility PureCycle Technologies has a beta of 2.63, meaning that its stock price is 163% more volatile than the S&P 500. Comparatively, Stepan has a beta of 0.94, meaning that its stock price is 6% less volatile than the S&P 500.

Insider & Institutional Ownership 63.0% of PureCycle Technologies shares are owned by institutional investors. Comparatively, 82.7% of Stepan shares are owned by institutional investors. 18.8% of PureCycle Technologies shares are owned by company insiders. Comparatively, 6.6% of Stepan shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary Stepan beats PureCycle Technologies on 9 of the 15 factors compared between the two stocks.

(Get Free Report)

PureCycle Technologies, Inc. engages in the production of recycled polypropylene (PP). The company holds a license for restoring waste PP into ultra-pure recycled polypropylene resin that has multiple applications, including packaging and labeling for consumer products, piping, ropes, cabling, and plastic parts for various industries. Its recycling process separates color, odor, and other contaminants from plastic waste feedstock to transform it into virgin-like resin. The company was founded in 2015 and is headquartered in Orlando, Florida.

About Stepan (Get Free Report)

Stepan Company, together with its subsidiaries, produces and sells specialty and intermediate chemicals to other manufacturers for use in various end products worldwide. It operates through three segments: Surfactants, Polymers, and Specialty Products. The Surfactants segment offers surfactants that are used in consumer and industrial cleaning and disinfection products, including detergents for washing clothes, dishes, carpets, and floors and walls, as well as shampoos and body washes; and other applications, such as fabric softeners, germicidal quaternary compounds, disinfectants, and lubricating ingredients. Its surfactants are also used in various applications, including emulsifiers for spreading agricultural products; and industrial applications comprising latex systems, plastics, and composites. The Polymers segment provides polyurethane polyols that are used in the manufacture of rigid foam for thermal insulation in the construction industry, as well as a base raw material for coatings, adhesives, sealants, and elastomers (CASE); polyester resins, including liquid and powdered products, which are used in CASE applications; and phthalic anhydride that is used in unsaturated polyester resins, alkyd resins, and plasticizers for applications in construction materials, as well as components of automotive, boating, and other consumer products. The Specialty Products segment offers flavors, emulsifiers, and solubilizers for use in food, flavoring, nutritional supplement, and pharmaceutical applications. Stepan Company was founded in 1932 and is headquartered in Northbrook, Illinois.

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Here are two stocks with buy rank and strong momentum characteristics for investors to consider today, September 30th:

Stepan (SCL - Free Report) : This company, which is a major manufacturer of specialty and intermediate chemicals used in a broad range of industries, has a Zacks Rank #1(Strong Buy), and witnessed the Zacks Consensus Estimate for its current year earnings increasing 10.3% over the last 60 days.

Stepan’s shares gained 12.3% over the last three month compared with the S&P 500’s gain of 2.5%. The company possesses a Momentum Score of B.

AC Immune (ACIU - Free Report) : This biopharmaceutical company, that develops, discover and design novel, proprietary medicines for prevention, diagnosis and treatment of neurodegenerative diseases, has a Zacks Rank #1, and witnessed the Zacks Consensus Estimate for its current year earnings increasing 28.6% over the last 60 days.

AC Immune’s shares gained 9.2% over the last three month compared with the S&P 500’s gain of 2.5%. The company possesses a Momentum Score of B.

See the full list of top ranked stocks here

Learn more about the Momentum score and how it is calculated here.

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Connor Clark & Lunn Investment Management Ltd. acquired a new position in Stepan Company (NYSE:SCL – Free Report) during the 2nd quarter, according to the company in its most recent Form 13F filing with the Securities & Exchange Commission. The fund acquired 13,945 shares of the basic materials company’s stock, valued at approximately $777,000. Connor Clark & Lunn Investment Management Ltd. owned about 0.06% of Stepan at the end of the most recent quarter.

A number of other institutional investors have also recently bought and sold shares of the business. Northwestern Mutual Wealth Management Co. bought a new stake in shares of Stepan during the 2nd quarter worth $25,000. 1620 Investment Advisors Inc. grew its position in Stepan by 86.9% during the fourth quarter. 1620 Investment Advisors Inc. now owns 570 shares of the basic materials company’s stock valued at $27,000 after buying an additional 265 shares during the period. EverSource Wealth Advisors LLC increased its holdings in Stepan by 206.5% during the second quarter. EverSource Wealth Advisors LLC now owns 521 shares of the basic materials company’s stock worth $28,000 after buying an additional 351 shares during the last quarter. Allworth Financial LP bought a new stake in Stepan in the second quarter worth about $33,000. Finally, Parallel Advisors LLC boosted its stake in Stepan by 700.0% in the fourth quarter. Parallel Advisors LLC now owns 688 shares of the basic materials company’s stock valued at $33,000 after acquiring an additional 602 shares during the last quarter. Institutional investors own 82.70% of the company’s stock.

Wall Street Analysts Forecast Growth Several equities analysts have weighed in on the company. Weiss Ratings raised Stepan from a “sell (d)” rating to a “sell (d+)” rating in a report on Wednesday, July 29th. Seaport Research Partners reaffirmed a “buy” rating and set a $85.00 price target on shares of Stepan in a research report on Friday, August 7th. Wall Street Zen upgraded Stepan from a “hold” rating to a “buy” rating in a research note on Saturday, August 8th. Finally, Zacks Research raised shares of Stepan from a “strong sell” rating to a “hold” rating in a report on Monday, July 6th. One research analyst has rated the stock with a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat, the company has an average rating of “Reduce”.

Check Out Our Latest Stock Report on SCL Stepan Price Performance Shares of Stepan stock opened at $62.49 on Tuesday. The firm has a market capitalization of $1.42 billion, a PE ratio of -520.75 and a beta of 0.94. The company has a current ratio of 1.15, a quick ratio of 0.77 and a debt-to-equity ratio of 0.20. Stepan Company has a 12 month low of $41.82 and a 12 month high of $68.00. The business’s 50-day moving average price is $60.22 and its 200-day moving average price is $54.97.

Stepan (NYSE:SCL – Get Free Report) last released its quarterly earnings data on Wednesday, July 29th. The basic materials company reported $1.18 earnings per share for the quarter, beating analysts’ consensus estimates of $0.61 by $0.57. Stepan had a positive return on equity of 3.90% and a negative net margin of 0.11%.The firm had revenue of $684.11 million during the quarter, compared to analyst estimates of $635.85 million. During the same quarter in the prior year, the firm posted $0.52 earnings per share. The business’s quarterly revenue was up 15.0% compared to the same quarter last year. Sell-side analysts forecast that Stepan Company will post 2.69 EPS for the current fiscal year.

Stepan Dividend Announcement The business also recently disclosed a quarterly dividend, which will be paid on Tuesday, September 15th. Shareholders of record on Tuesday, September 1st will be paid a dividend of $0.395 per share. The ex-dividend date is Tuesday, September 1st. This represents a $1.58 dividend on an annualized basis and a yield of 2.5%. Stepan’s payout ratio is presently -1,316.67%.

About Stepan (Free Report)

Stepan Company is a global manufacturer of specialty and intermediate chemicals, primarily known for its development and production of surfactants and related specialty products. The company’s portfolio includes a wide range of ingredients used to enhance the performance of consumer and industrial formulations, such as emulsifiers, foam control agents, odor control agents, antimicrobial products and performance additives. These products are integral components in cleaning solutions, personal care items, agrochemical formulations, coatings, oilfield treatments and polymer systems.

Serving a diverse set of end-markets, Stepan’s offerings address both consumer-facing and industrial applications.

Further Reading Five stocks we like better than Stepan Securing AI: 5 Most-Upgraded Stocks From the Q2 Reporting Season Insiders Are Betting Big on These 3 Healthcare Stocks 3 Stocks for Investors Who Still Believe Cash Is King Dollar General and Dollar Tree Are Recovering, But Not for the Same Reason Want to see what other hedge funds are holding SCL? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Stepan Company (NYSE:SCL – Free Report).

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Deutsche Bank AG bought a new position in Stepan Company (NYSE:SCL – Free Report) during the second quarter, according to the company in its most recent 13F filing with the SEC. The fund bought 23,364 shares of the basic materials company’s stock, valued at approximately $1,302,000. Deutsche Bank AG owned about 0.10% of Stepan as of its most recent SEC filing.

Several other hedge funds and other institutional investors have also bought and sold shares of the business. Goldman Sachs Group Inc. raised its position in Stepan by 195.5% in the fourth quarter. Goldman Sachs Group Inc. now owns 299,970 shares of the basic materials company’s stock worth $14,207,000 after acquiring an additional 198,457 shares during the period. Bank of New York Mellon Corp purchased a new position in Stepan in the second quarter valued at approximately $6,836,000. Towle & Co. purchased a new position in Stepan in the first quarter valued at approximately $5,295,000. Bridgeway Capital Management LLC bought a new position in Stepan during the second quarter valued at $5,573,000. Finally, Sei Investments Co. grew its holdings in Stepan by 465.5% during the first quarter. Sei Investments Co. now owns 123,800 shares of the basic materials company’s stock valued at $6,188,000 after purchasing an additional 101,907 shares during the period. Hedge funds and other institutional investors own 82.70% of the company’s stock.

Stepan Trading Down 0.6% Shares of SCL opened at $62.44 on Friday. Stepan Company has a twelve month low of $41.82 and a twelve month high of $68.00. The stock has a market cap of $1.42 billion, a PE ratio of -520.33 and a beta of 0.94. The company has a quick ratio of 0.77, a current ratio of 1.15 and a debt-to-equity ratio of 0.20. The business’s 50-day moving average price is $60.04 and its 200-day moving average price is $55.04.

Stepan (NYSE:SCL – Get Free Report) last released its quarterly earnings data on Wednesday, July 29th. The basic materials company reported $1.18 EPS for the quarter, beating analysts’ consensus estimates of $0.61 by $0.57. The company had revenue of $684.11 million during the quarter, compared to analyst estimates of $635.85 million. Stepan had a negative net margin of 0.11% and a positive return on equity of 3.90%. Stepan’s revenue was up 15.0% compared to the same quarter last year. During the same period last year, the business earned $0.52 earnings per share. On average, equities analysts forecast that Stepan Company will post 2.69 EPS for the current fiscal year. Stepan Announces Dividend The company also recently declared a quarterly dividend, which will be paid on Tuesday, September 15th. Shareholders of record on Tuesday, September 1st will be issued a $0.395 dividend. This represents a $1.58 annualized dividend and a yield of 2.5%. The ex-dividend date of this dividend is Tuesday, September 1st. Stepan’s dividend payout ratio (DPR) is presently -1,316.67%.

Wall Street Analysts Forecast Growth Several brokerages have issued reports on SCL. Weiss Ratings upgraded Stepan from a “sell (d)” rating to a “sell (d+)” rating in a research note on Wednesday, July 29th. Zacks Research upgraded Stepan from a “strong sell” rating to a “hold” rating in a research note on Monday, July 6th. Wall Street Zen raised Stepan from a “hold” rating to a “buy” rating in a report on Saturday, August 8th. Finally, Seaport Research Partners restated a “buy” rating and issued a $85.00 price objective on shares of Stepan in a research note on Friday, August 7th. One analyst has rated the stock with a Hold rating and one has assigned a Sell rating to the company’s stock. Based on data from MarketBeat, the stock presently has a consensus rating of “Reduce”.

View Our Latest Research Report on SCL

About Stepan (Free Report)

Stepan Company is a global manufacturer of specialty and intermediate chemicals, primarily known for its development and production of surfactants and related specialty products. The company’s portfolio includes a wide range of ingredients used to enhance the performance of consumer and industrial formulations, such as emulsifiers, foam control agents, odor control agents, antimicrobial products and performance additives. These products are integral components in cleaning solutions, personal care items, agrochemical formulations, coatings, oilfield treatments and polymer systems.

Serving a diverse set of end-markets, Stepan’s offerings address both consumer-facing and industrial applications.

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3 chemical stocks to play the industry breakoutStepan NYSE: SCL reported higher second-quarter earnings as broad-based volume growth, margin recovery and early savings from its Project Catalyst program lifted results, while management cautioned that some demand may have been pulled forward amid geopolitical and raw-material uncertainty.

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Reported net income for the second quarter of 2026 was $22.9 million, or $1.00 per diluted share, compared with $11.3 million, or $0.50 per share, a year earlier. Adjusted net income increased to $27.1 million, or $1.18 per diluted share, from $12 million, or $0.52 per share, in the prior-year period.

Net sales rose 15% year over year to $684 million. President and Chief Executive Officer Luis Rojo said higher selling prices, increased volumes, favorable product and customer mix, and favorable currency translation contributed to the sales increase. Adjusted EBITDA rose 45% to $74.4 million, while organic volume increased 6% across the company.

Volume Growth and Margin Recovery Drive Results Rojo said the company’s second-quarter performance reflected contributions from volume growth, margin recovery and productivity initiatives. Pricing actions and contractual pass-through mechanisms helped offset higher raw-material costs, he said, while Project Catalyst savings were ramping in line with the company’s plan.

However, management said some of the quarter’s sales strength may have reflected customer inventory building. Rojo estimated that pre-buying tied to uncertainty surrounding the Iran conflict and raw-material availability represented roughly $5 million to $10 million of EBITDA in the second quarter.

“We are considering that potential timing effect as we plan for the second half of 2026,” Rojo said in prepared remarks. During the question-and-answer session, he added that the company expects third-quarter results to be somewhat lower than the second quarter after accounting for the elevated volume and margin contribution.

Chief Financial Officer Ruben Velasquez said the company also expects special maintenance turnarounds, particularly in Polymers, to reduce second-half results by approximately $4 million to $5 million.

Surfactants and Polymers Lead Segment Improvement The Surfactants segment reported net sales of $484 million, up 18% from a year earlier. Selling prices increased 12%, largely reflecting raw-material pass-throughs, product and customer mix, and pricing actions. Reported volume rose 3%, while organic volume increased 7%; currency translation added 4% to sales.

Surfactants adjusted EBITDA increased 59% to $55 million. The company cited broad-based volume growth, Project Catalyst savings and recovery from production-timing and absorption impacts discussed in the first quarter. Industrial cleaning, laundry, construction and industrial applications, and oil field were among the leading growth areas.

Rojo highlighted growth in the company’s Tier 2 and Tier 3 customer base, saying the business generated 500 new customer-product combinations during the first half. He also said Stepan recorded double-digit growth in oil field and continued growth in agriculture despite market challenges related to fertilizers and the Iran conflict.

Polymers sales increased 9% to $178 million, with selling prices up 3% and volume up 5%. North American volume grew by strong double digits, driven by Rigid Polyols and Phthalic Anhydride, including significant growth in spray foam products. Those gains were partly offset by lower volumes in Europe and Asia.

Polymers adjusted EBITDA rose 22% to $31 million, primarily on volume growth and margin recovery. North American EBITDA increased by $5 million, while Europe improved modestly as better margins offset continued soft construction demand. Asia was slightly lower because of softer demand in China.

Specialty Products sales rose 8% to $22 million, while volume increased 4%. Adjusted EBITDA was slightly lower at $6.5 million due to a less favorable product mix in medium-chain triglycerides.

Project Catalyst Actions Continue Stepan said Project Catalyst is expected to produce approximately $100 million in pre-tax savings over two years, with about 60% of the savings anticipated in 2026. Rojo said the company remains on track to exceed its commitment of $60 million in pre-tax savings this year and is currently realizing approximately $18 million to $20 million in savings per quarter.

The company expects to exit 2026 at a quarterly savings run rate of about $22 million, according to Rojo. He said most of the program’s savings actions have already been executed or announced, though Stepan continues to identify additional initiatives needed to reach the full $100 million run-rate target next year.

During the first half, Stepan completed the closure of its Fieldsboro, New Jersey, site and decommissioned select assets at Millsdale, Illinois, and Stalybridge, United Kingdom. The company is transferring volumes to other facilities in its network.

Velasquez said reported second-quarter results included a $5.1 million pre-tax restructuring charge, primarily tied to those actions. Stepan expects full-year restructuring charges of $75 million to $80 million. The company also announced plans to reduce approximately 100 salaried positions in the third quarter, with most associated expenses expected to be recognized in the second half.

Cash Flow and Balance Sheet Free cash flow was negative $15 million in the quarter after $23 million of capital expenditures and a $58 million working-capital build tied to stronger sales and higher raw-material costs. Cash from operations before working-capital changes was $56 million, including approximately $6 million of cash restructuring costs.

Net debt ended the quarter at $534 million, and net leverage improved to 2.5 times from 2.7 times in the first quarter and 2.9 times a year earlier. The company paid $9 million in dividends during the quarter and said it remains focused on cash generation, deleveraging and disciplined capital allocation.

Rojo said Stepan expects to deliver full-year adjusted EBITDA growth, positive free cash flow and continued balance-sheet deleveraging in 2026, while navigating ongoing uncertainty in raw materials and global markets.

About Stepan (NYSE:SCL)Stepan Company is a global manufacturer of specialty and intermediate chemicals, primarily known for its development and production of surfactants and related specialty products. The company's portfolio includes a wide range of ingredients used to enhance the performance of consumer and industrial formulations, such as emulsifiers, foam control agents, odor control agents, antimicrobial products and performance additives. These products are integral components in cleaning solutions, personal care items, agrochemical formulations, coatings, oilfield treatments and polymer systems.

Serving a diverse set of end-markets, Stepan's offerings address both consumer-facing and industrial applications.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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Stepan Company (SCL) Q2 2026 Earnings Call Transcript

, /PRNewswire/ -- Stepan Company (NYSE: SCL) today reported:

Second Quarter 2026 Highlights

Reported net income was $22.9 million, up 102% versus the prior year. Adjusted net income(1) was $27.1 million, up 126% versus the prior year. EBITDA(2) was $69.1 million and Adjusted EBITDA(2) was $74.4 million, up 37% and 45% respectively, year-over-year. Global sales volume was up 3% year-over-year. Organic sales volume was up 6% year-over-year.       Cash from Operations was $8.4 million during the quarter. Free cash flow(3) for the quarter was a negative $15.0 million, driven by higher working capital requirements. Excluding the impact of higher working capital, free cash flow was $32.7 million, up 69% versus the prior year. Pre-tax earnings include a $5.1 million restructuring charge largely related to the previously announced closure of the Company's Fieldsboro, NJ site and decommissioning of select assets at its Elwood (Millsdale), IL and Stalybridge, UK facilities.  The Company announced today a plan to reduce its global salaried workforce by approximately 100 positions. This action is part of the previously announced Project Catalyst efficiency initiative. The majority of this restructuring expense is expected to be recognized during the second half of 2026. The Company anticipates full year restructuring charges in the range of $75.0 to $80.0 million, which is in line with prior communications, with a projected cash impact between $14.0 and $18.0 million. First Half 2026 Highlights

Reported net income was a $18.5 million loss versus $31.1 million of income in the prior year. The current year loss is entirely due to a $70.5 million pre-tax restructuring charge. The cash impact associated with this restructuring charge was approximately $7.0 million year-to-date.  Adjusted net income(1) was $37.4 million, up 20% versus the prior year. EBITDA(2) was $52.7 million and Adjusted EBITDA(2) was $124.1 million. Adjusted EBITDA was up 14% year-over-year. Organic sales volume was up 3% year-over-year. "Quarterly earnings were up significantly driven by improved Surfactant and Polymer results. Second quarter adjusted EBITDA of $74.4 million was up 45% year-over-year due to global volume growth, margin recovery and Project Catalyst savings. We believe the quarter also benefited from customer pre-buys as a result of the global geopolitical situation. Surfactant and Polymer adjusted EBITDA were up 59% and 22%, respectively," said Luis E. Rojo, President and Chief Executive Officer. "Surfactant organic sales volume was up 7% and Polymer sales volume was up 5% in the quarter. The Surfactant volume growth was broad-based and across all end markets and all regions. Within Polymers, the North American Rigid and Phthalic Anhydride businesses delivered double digit volume growth. We are pleased with the growth we achieved in several of our key strategic end markets despite ongoing global economic uncertainties and supply chain disruptions. We continue to execute Project Catalyst safely and in line with expectations. As part of the organizational-effectiveness component of Project Catalyst, today we announced a plan to reduce the Company's global salaried workforce by around 100 roles before the end of the year. During the past few quarters, we took a disciplined and deliberate approach to minimize the impact of these actions through normal attrition, pausing external hiring and emphasizing internal talent. We are committed to supporting our affected colleagues through this transition in line with our People First culture."       

Financial Summary

Three Months Ended
June 30,

Six Months Ended
June 30,

($ in thousands, except per share data)

2026

2025

%
Change

2026

2025

%
Change

Net Sales

$

684,109

$

594,689

15

%

$

1,288,618

$

1,187,944

8

%

Operating Income (Loss)

$

37,210

$

17,965

107

%

$

(12,412)

$

46,253

NM

Net Income (Loss)

$

22,911

$

11,341

102

%

$

(18,495)

$

31,052

NM

Earnings per Diluted Share

$

1.00

$

0.50

100

%

$

(0.81)

$

1.36

NM

Adjusted Net Income *

$

27,052

$

11,952

126

%

$

37,365

$

31,262

20

%

Adjusted Earnings per
   Diluted Share *

$

1.18

$

0.52

127

%

$

1.63

$

1.37

19

%

* See Table II for reconciliations of non-GAAP adjusted net income and adjusted earnings per diluted share.

Percentage Change in Net Sales

Net sales in the second quarter of 2026 increased 15% year-over-year.  This increase reflects higher selling prices, mainly attributable to the pass-through of higher raw material costs and more favorable product mix, a 3% increase in sales volume and the favorable impact of foreign currency translation. Organic sales volume was up 6% year-over-year.  

Three Months Ended
June 30, 2026

Six Months Ended
June 30, 2026

Volume

3

%

(—)

%

Selling Price & Mix

9

%

5

%

Foreign Translation

3

%

3

%

Total

15

%

8

%

Segment Results

Three Months Ended
June 30,

Six Months Ended
June 30,

($ in thousands)

2026

2025

%
Change

2026

2025

%
Change

Net Sales

Surfactants

$

483,902

$

411,456

18

%

$

937,589

$

841,793

11

%

Polymers

$

178,007

$

162,751

9

%

$

308,036

$

308,867

(0)

%

Specialty Products

$

22,200

$

20,482

8

%

$

42,993

$

37,284

15

%

Total Net Sales

$

684,109

$

594,689

15

%

$

1,288,618

$

1,187,944

8

%

Three Months Ended
June 30,

Six Months Ended
June 30,

($ in thousands, all amounts pre-tax)

2026

2025

%
Change

2026

2025

%
Change

Operating Income (Loss)

Surfactants

$

34,362

$

13,367

157

%

$

52,910

$

42,297

25

%

Polymers

$

22,469

$

17,159

31

%

$

31,291

$

25,177

24

%

Specialty Products

$

5,007

$

5,258

(5)

%

$

9,722

$

10,766

(10)

%

Total Segment
   Operating Income

$

61,838

$

35,784

73

%

$

93,923

$

78,240

20

%

Corporate Expenses

$

(24,628)

$

(17,819)

38

%

$

(106,335)

$

(31,987)

232

%

Consolidated
   Operating Income
    (Loss)

$

37,210

$

17,965

107

%

$

(12,412)

$

46,253

NM

Three Months Ended
June 30,

Six Months Ended
June 30,

($ in millions)

2026

2025

%
Change

2026

2025

%
Change

EBITDA

$

69.1

$

50.6

37

%

$

52.7

$

108.6

(51)

%

Adjusted EBITDA

   Surfactants

$

54.9

$

34.5

59

%

$

96.0

$

82.9

16

%

   Polymers

$

31.2

$

25.6

22

%

$

48.6

$

41.6

17

%

   Specialty Products

$

6.5

$

6.7

(3)

%

$

12.6

$

13.7

(8)

%

   Unallocated Corporate

$

(18.1)

$

(15.4)

18

%

$

(33.1)

$

(29.3)

13

%

Consolidated Adjusted EBITDA

$

74.4

$

51.4

45

%

$

124.1

$

108.9

14

%

Consolidated adjusted EBITDA(2) increased $23.0 million, or 45%, in the quarter.  This  increase was primarily due to higher Surfactant and Polymer earnings driven by sales volume growth and margin recovery.        

Surfactant net sales were $483.9 million for the quarter, up 18% versus the prior year.  Selling prices were up 12% primarily due to pass through of higher raw material costs, improved product and customer mix, along with pricing actions.  Global Sales volume was up 2% and organic sales volume increased 7%.  All global regions recognized organic volume growth and our strategic end markets combined grew high single digits.  Foreign currency translation positively impacted net sales by 4%.  Surfactant adjusted EBITDA(2)  for the quarter increased $20.4 million, or 59%, versus the prior year.  This increase was primarily due to sales volume growth and margin recovery.  Polymer net sales were $178.0 million for the quarter, a 9% increase versus the prior year.  Selling prices were up 3%, primarily due to the pass-through of higher raw material costs and margin recovery.  Sales volume increased 5% in the quarter.  North American sales volume was up double digits, inclusive of significant growth in Spray Foam, partially offset by lower volumes in Europe and Asia.  Foreign currency translation positively impacted net sales by 1% during the quarter.  Polymer adjusted EBITDA(2) increased $5.6 million, or 22%, versus the prior year primarily due to sales volume growth and global margin improvement. Specialty Products net sales were $22.2 million for the quarter, an 8% increase versus the prior year.  Specialty Products volume increased 4% while adjusted EBITDA(2) decreased $0.2 million, or 3%.  The slight decrease in adjusted EBITDA(2) was primarily due to less favorable product mix within the medium chain triglycerides product line that was mostly offset by higher earnings in the food and flavor business.  Outlook

"We believe we are positioned to continue delivering growth in all our key strategic businesses such as Crop Productivity, Oilfield, Tier 2/3 Surfactants and North American Polymers.  We continue to execute on Project Catalyst, which is our comprehensive plan designed to further optimize our asset base and create a more productive and agile organization to enable balanced growth," said Luis E. Rojo, President and Chief Executive Officer.  "Despite the ongoing and significant market uncertainties and challenges,  the organization is focused on executing our growth opportunities, productivity plans and cash interventions.  With these actions and the strong first half results, we believe we will deliver full year Adjusted EBITDA growth, positive free cash flow and continue to de-leverage the balance sheet in 2026."  

Notes

(1) Adjusted net income and adjusted earnings per share are non-GAAP measures which exclude deferred compensation income/expense, certain environmental remediation-related costs as well as other significant and infrequent/non-recurring items. See Table II for reconciliations of non-GAAP adjusted net income and adjusted earnings per diluted share.

(2) EBITDA and adjusted EBITDA are non-GAAP measures.  See Table VI for calculations and GAAP reconciliations of EBITDA and adjusted EBITDA.

(3) Free cash flow is a non-GAAP measure and reflects cash generated from operations minus capital expenditures.  Cash generated from operations was $8.4 million during the second quarter of 2026 and capital expenditures were $23.4 million. 

Conference Call

Stepan Company will host a conference call to discuss its second quarter results at 9:00 a.m. ET (8:00 a.m. CT) on July 29, 2026. The call can be accessed by phone and webcast. To access the call by phone, please click on this Registration Link, complete the form and you will be provided with dial in details and a PIN. To avoid delays, we encourage participants to dial into the conference call ten minutes ahead of the scheduled start time. The webcast can be accessed through the Investors/Conference Calls page at www.stepan.com. A webcast replay of the conference call will be available at the same location shortly after the call.

Supporting Slides

Slides supporting this press release will be made available at www.stepan.com through the Investors/Presentations page at approximately the same time as this press release is issued.

Corporate Profile

Stepan Company is a major manufacturer of specialty and intermediate chemicals used in a broad range of industries. Stepan is a leading merchant producer of surfactants, which are the key ingredients in consumer and industrial cleaning and disinfection compounds and in agricultural and oilfield solutions. The Company is also a leading supplier of polyurethane polyols used in the expanding thermal insulation market, and CASE (Coatings, Adhesives, Sealants, and Elastomers) industries.

Headquartered in Northbrook, Illinois, Stepan utilizes a network of modern production facilities located in North and South America, Europe and Asia. 

The Company's common stock is traded on the New York Stock Exchange (NYSE) under the symbol SCL. For more information about Stepan Company please visit the Company online at www.stepan.com

More information about Stepan's sustainability program can be found on the Sustainability page at www.stepan.com

Certain information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include statements about Stepan Company's plans, objectives, strategies, financial performance and outlook, trends, the amount and timing of future cash distributions, prospects or future events and involve known and unknown risks that are difficult to predict. As a result, Stepan Company's actual financial results, performance, achievements or prospects may differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by the use of words such as "may," "could," "expect," "intend," "plan," "seek," "anticipate," "believe," "estimate," "guidance," "predict," "potential," "continue," "likely," "will," "would," "should," "illustrative" and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by Stepan Company and its management based on their knowledge and understanding of the business and industry, are inherently uncertain. These statements are not guarantees of future performance, and stockholders should not place undue reliance on forward-looking statements.

There are a number of risks, uncertainties and other important factors, many of which are beyond Stepan Company's control, that could cause actual results to differ materially from the forward-looking statements contained in this news release. Such risks, uncertainties and other important factors include, among other factors, the risks, uncertainties and factors described in Stepan Company's Form 10-K, Form 10-Q and Form 8-K reports and exhibits to those reports, and include (but are not limited to) risks and uncertainties related to our ability to realize cost savings or operating efficiencies associated with strategic initiatives, including Project Catalyst; accidents, unplanned production shutdowns or disruptions in manufacturing facilities; reduced demand due to customer product reformulations or new technologies; our inability to successfully develop or introduce new products; compliance with laws and other legal restrictions, including those relating to the international scope of our business; domestic and global competition; volatility of raw material and energy costs and supply; disruptions in transportation or significant changes in transportation costs; downturns in certain industries and general economic downturns; international business risks, including changes in global trade policies, tariffs and retaliatory measures and countermeasures; currency exchange rate fluctuations; changes in tax policy and potential adverse tax consequences due to the international scope of our business; downgrades in our credit ratings or our ability to access the credit or capital markets if and when necessary; global political, military, security or other instability and increased security regulations; costs, delays and miscalculations in capacity needs related to expansion or other capital projects; interruption or breaches of information technology systems; unfavorable resolution of litigation against us; maintaining and protecting intellectual property rights; our ability to identify suitable acquisition candidates and successfully complete and integrate acquisitions; our ability to retain executive management and key personnel; and issues relating to compliance with our debt covenants.  In addition to the risks described in the Company's periodic reports, the restructuring actions described herein may involve risks related to the execution of facility closures and asset decommissioning, potential operational disruptions, impacts on employees and local communities, environmental compliance, and the realization of anticipated cost savings and efficiencies.

These forward-looking statements are made only as of the date hereof, and Stepan Company undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by applicable laws.

* * * * *

Tables follow

Table I

STEPAN COMPANY
For the Three and Six Months Ended June 30, 2026 and 2025
(Unaudited – in 000's, except per share data)

Three Months Ended
June 30,

Six Months Ended
June 30,

2026

2025

2026

2025

Net Sales

$

684,109

$

594,689

$

1,288,618

$

1,187,944

Cost of Sales

584,127

522,804

1,123,785

1,040,596

Gross Profit

99,982

71,885

164,833

147,348

Operating Expenses:

Selling

14,866

14,657

27,032

26,765

Administrative

24,203

22,801

45,516

44,215

Research, Development and Technical Services

17,195

14,701

32,188

29,350

Deferred Compensation

1,402

1,761

1,964

765

57,666

53,920

106,700

101,095

Business Restructuring

5,106

-

70,545

-

Operating Income (Loss)

37,210

17,965

(12,412)

46,253

Other Income (Expense):

Interest, Net

(5,682)

(5,485)

(10,693)

(9,611)

Other, Net

1,021

1,306

1,165

1,808

(4,661)

(4,179)

(9,528)

(7,803)

Income (Loss) Before Provision for Income
  Taxes

32,549

13,786

(21,940)

38,450

Provision for Income Taxes

9,638

2,445

(3,445)

7,398

Net Income (Loss)

22,911

11,341

(18,495)

31,052

Net Income (Loss) Per Common Share

Basic

$

1.00

$

0.50

$

(0.81)

$

1.36

Diluted

$

1.00

$

0.50

$

(0.81)

$

1.36

Shares Used to Compute Net Income Per
   Common Share

Basic

22,897

22,865

22,893

22,866

Diluted

22,924

22,879

22,893

22,885

Table II

Reconciliation of Non-GAAP Net Income (Loss) and Earnings per Diluted Share*

Three Months Ended
June 30,

Six Months Ended
June 30,

($ in thousands, except per share amounts)

2026

EPS

2025

EPS

2026

EPS

2025

EPS

Net Income (Loss) Reported

$

22,911

$

1.00

$

11,341

$

0.50

$

(18,495)

$

(0.81)

$

31,052

$

1.36

Deferred Compensation (Income)
    Expense

$

52

$

-

$

69

$

-

$

529

$

0.02

$

(401)

$

(0.02)

Environmental Remediation
    Expense

$

92

$

-

$

542

$

0.02

$

170

$

0.01

$

611

$

0.03

Business Restructuring

$

3,997

$

0.18

$

-

$

-

$

55,161

$

2.41

$

-

$

-

Adjusted Net Income

$

27,052

$

1.18

$

11,952

$

0.52

$

37,365

$

1.63

$

31,262

$

1.37

* All amounts in this table are presented after-tax

The Company believes that certain non-GAAP measures, in conjunction with comparable GAAP measures, are useful for evaluating the Company's operating performance and financial condition. The Company uses this non-GAAP information as an indicator of business performance and evaluates management's effectiveness with specific reference to these indicators. Management believes that these non-GAAP financial measures provide useful supplemental information because they exclude non-operational items that affect comparability between years. These measures should be considered in addition to, not as substitutes for or superior to, measures of financial performance prepared in accordance with GAAP and may differ from similarly titled measures presented by other companies. The Company's Annual Report on Form 10-K for the year ended December 31, 2025 contains additional information regarding the use of non-GAAP financial measures.

Summary of Second Quarter 2026 Adjusted Net Income Items

Adjusted net income excludes non-operational deferred compensation income/expense, certain environmental remediation costs and other significant and infrequent or non-recurring items.

Deferred Compensation: The second quarter of 2026 reported net income includes $0.1 million of after-tax expense versus $0.1 million of after-tax expense in the prior year.  Environmental Remediation: The second quarter of 2026 reported net income includes $0.1 million of after-tax expense versus $0.5 million of after-tax expense in the prior year. Business Restructuring: The second quarter of 2026 reported net income includes $4.0 million of after-tax expense related to restructuring charges.  There were no restructuring charges recognized in the prior year quarter. Table III

Reconciliation of Pre-Tax to After-Tax Adjustments

Management uses the non-GAAP adjusted net income metric to evaluate the Company's operating performance. Management excludes the items listed in the table below because they are non-operational items. The cumulative tax effect is typically calculated using the statutory tax rates for the jurisdictions in which the transactions occurred.

Three Months Ended
June 30,

Six Months Ended
June 30,

($ in thousands, except per share amounts)

2026

EPS

2025

EPS

2026

EPS

2025

EPS

Pre-Tax Adjustments

Deferred Compensation (Income)
     Expense

$

68

$

92

$

696

$

(534)

Environmental Remediation
     Expense

$

121

$

722

$

223

$

814

Business Restructuring

$

5,106

$

-

$

70,545

$

-

   Total Pre-Tax Adjustments

$

5,295

$

814

$

71,464

$

280

Cumulative Tax Effect on
      Adjustments

$

(1,154)

$

(203)

$

(15,604)

$

(70)

After-Tax Adjustments

$

4,141

$

0.18

$

611

$

0.02

$

55,860

$

2.44

$

210

$

0.01

Table IV

Deferred Compensation Plans

The full effect of the deferred compensation plans on quarterly pre-tax income was $0.1 million of expense versus $0.1 million of expense in the prior year.  The quarter-end market prices of Company stock and the impact of deferred compensation on specific income statement line items is summarized below:

2026

2025

6/30

3/31

12/31

9/30

6/30

3/31

Stepan Company

$

55.72

$

49.98

$

47.36

$

47.70

$

54.58

$

55.04

Three Months Ended
June 30,

Six Months Ended
June 30,

($ in thousands)

2026

2025

2026

2025

Deferred Compensation

Operating Income (Expense)

$

(1,402)

$

(1,761)

$

(1,964)

$

(765)

Other, net – Mutual Fund Gain

1,334

1,669

1,268

1,299

Total Pre-Tax

$

(68)

$

(92)

$

(696)

$

534

Total After-Tax

$

(52)

$

(69)

$

(529)

$

401

Effects of Foreign Currency Translation

The Company's foreign subsidiaries transact business and report financial results in their respective local currencies. These results are translated into U.S. dollars at average foreign exchange rates appropriate for the reporting period.  The table below presents the impact that foreign currency translation had on select income statement line items. 

($ in millions)

Three Months
Ended
June 30,

Change

Change
Due to
Foreign
Currency
Translation

Six Months Ended
June 30,

Change

Change
Due to
Foreign
Currency
Translation

2026

2025

2026

2025

Net Sales

$

684.1

$

594.7

$

89.4

$

17.1

$

1,288.6

$

1,187.9

$

100.7

$

42.4

Gross Profit

100.0

71.9

$

28.1

2.9

164.8

147.3

$

17.5

5.4

Operating Income
    (Loss)

37.2

18.0

$

19.2

2.1

(12.4)

46.3

$

(58.7)

3.4

Pretax Income
    (Loss)

32.5

13.8

$

18.7

2.1

(21.9)

38.5

$

(60.4)

3.5

Corporate Expenses

Three Months Ended
June 30,

Six Months Ended
June 30,

($ in thousands)

2026

2025

%
Change

2026

2025

%
Change

Total Corporate Expenses

$

24,628

$

17,819

38

%

$

106,335

$

31,987

232

%

Less:

   Deferred Compensation Expense

$

1,402

$

1,761

(20)

%

$

1,964

$

765

157

%

   Environmental Remediation
      Expense

$

121

$

722

(83)

%

$

223

$

814

(73)

%

   Business Restructuring

$

5,106

$

-

NM

$

70,545

$

-

NM

Adjusted Corporate Expenses

$

17,999

$

15,336

17

%

$

33,603

$

30,408

11

%

Adjusted Corporate expenses increased $2.7 million, or 17% for the quarter.  This increase was primarily due to higher incentive-based compensation expenses.  

Table V

Stepan Company
Consolidated Balance Sheets
June 30, 2026 and December 31, 2025

June 30, 2026

December 31,
2025

ASSETS

Current Assets

$

974,764

$

858,959

Property, Plant & Equipment, Net

1,142,612

1,219,627

Other Assets

275,290

279,116

Total Assets

$

2,392,666

$

2,357,702

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities

$

846,998

$

666,494

Deferred Income Taxes

10,998

11,450

Long-term Debt

244,069

340,975

Other Non-current Liabilities

78,555

94,773

Total Stepan Company Stockholders' Equity

1,212,046

1,244,010

Total Liabilities and Stockholders' Equity

$

2,392,666

$

2,357,702

Selected Balance Sheet Information 

The Company's total debt decreased by $4.3 million and cash decreased by $27.1 million versus March 31, 2026. The Company's net debt level increased $22.8 million versus March 31, 2026 and its net debt ratio was 31% versus 30% in the prior quarter (Net Debt and Net Debt Ratio are non-GAAP measures, reconciliations of which are shown in the table below). Management uses the non-GAAP net debt metric to show a more complete picture of the Company's overall liquidity, financial flexibility and leverage level. 

($ in millions)

June 30,
2026

March 31,
2026

December 31,
2025

Net Debt

Total Debt

$

647.4

$

651.7

$

626.7

Cash

113.7

140.8

132.7

Net Debt

$

533.7

$

510.9

$

494.0

Equity

1,212.0

1,193.0

1,244.0

Net Debt + Equity

$

1,745.7

$

1,703.9

$

1,738.0

Net Debt / (Net Debt + Equity)

31

%

30

%

28

%

The major working capital components were:

($ in millions)

June 30,
2026

March 31,
2026

December 31,
2025

Net Receivables

$

492.3

$

433.7

$

388.0

Inventories

324.5

289.0

298.8

Accounts Payable

(321.7)

(285.7)

(261.7)

$

495.1

$

437.0

$

425.1

Table VI

Reconciliations of Non-GAAP EBITDA and Adjusted EBITDA

Management uses the non-GAAP EBITDA and adjusted EBITDA metrics to evaluate the Company's operating performance.  Management excludes the items listed in the table below because they are non-operational items.  Refer to the Income Statement on Table I for a bridge between Operating Income and Net Income.

Three Months Ended
June 30, 2026

($ in millions)

Surfactants

Polymers

Specialty
Products

Unallocated
Corporate

Consolidated

Operating Income

$

34.4

$

22.5

$

5.0

$

(24.6)

$

37.2

   Depreciation and Amortization

20.5

8.7

1.5

0.2

30.9

   Other, Net Income

-

-

-

1.0

1.0

EBITDA

$

69.1

   Deferred Compensation

-

-

-

0.1

0.1

   Environmental Remediation

-

-

-

0.1

0.1

   Business Restructuring

-

-

-

5.1

5.1

Adjusted EBITDA

$

54.9

$

31.2

$

6.5

$

(18.1)

$

74.4

Three Months Ended
June 30, 2025

($ in millions)

Surfactants

Polymers

Specialty
Products

Unallocated
Corporate

Consolidated

Operating Income

$

13.4

$

17.2

$

5.2

$

(17.8)

$

18.0

   Depreciation and Amortization

21.1

8.4

1.5

0.3

31.3

   Other, Net Income

-

-

-

1.3

1.3

EBITDA

$

50.6

   Deferred Compensation

-

-

-

0.1

0.1

   Environmental Remediation

-

-

-

0.7

0.7

Adjusted EBITDA

$

34.5

$

25.6

$

6.7

$

(15.4)

$

51.4

Six Months Ended
June 30, 2026

($ in millions)

Surfactants

Polymers

Specialty
Products

Unallocated
Corporate

Consolidated

Operating Income

$

52.9

$

31.3

$

9.7

$

(106.3)

$

(12.4)

   Depreciation and Amortization

43.1

17.3

2.9

0.6

63.9

   Other, Net Income

-

-

-

1.2

1.2

EBITDA

$

52.7

   Deferred Compensation

-

-

-

0.7

0.7

   Environmental Remediation

-

-

-

0.2

0.2

   Business Restructuring

-

-

-

70.5

70.5

Adjusted EBITDA

$

96.0

$

48.6

$

12.6

$

(33.1)

$

124.1

Six Months Ended
June 30, 2025

($ in millions)

Surfactants

Polymers

Specialty
Products

Unallocated
Corporate

Consolidated

Operating Income

$

42.3

$

25.2

$

10.8

$

(32.0)

$

46.3

   Depreciation and Amortization

40.6

16.4

2.9

0.6

60.5

   Other, Net Income

-

-

-

1.8

1.8

EBITDA

$

108.6

   Deferred Compensation

-

-

-

(0.5)

(0.5)

   Environmental Remediation

-

-

-

0.8

0.8

Adjusted EBITDA

$

82.9

$

41.6

$

13.7

$

(29.3)

$

108.9

SOURCE Stepan Company

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Stepan Company (SCL) is reaffirmed as a 'buy' due to compelling valuation and significant cost-saving initiatives. SCL's Project Catalyst targets $100M in pre-tax savings over two years, with 60% expected in the current year. Despite mixed profitability and cash flow, SCL remains attractively priced versus peers, especially on cash flow metrics.

, /PRNewswire/ -- Stepan Company (NYSE: SCL) will issue its first quarter 2026 earnings results on Tuesday, April 28, 2026 at approximately 7:00 a.m. ET (6:00 a.m. CT). Supporting slides will be posted at approximately the same time on the Investors/Presentations page at www.stepan.com. The Company will hold a conference call to discuss and answer questions about its financial and operational performance on the same day at 8:00 a.m. ET (7:00 a.m. CT).

The call will be hosted by Luis E. Rojo, President and Chief Executive Officer, and Ruben D. Velasquez, Vice President and Chief Financial Officer.

The call can be accessed by phone and webcast. To access the call by phone, please click on this Registration Link, complete the form and you will be provided with dial in details and a PIN. To avoid delays, we encourage participants to dial into the conference call ten minutes ahead of the scheduled start time. The webcast can be accessed through the Investors/Conference Calls page at www.stepan.com. A webcast replay of the conference call will be available at the same location shortly after the call.

Corporate Profile

Stepan Company is a major manufacturer of specialty and intermediate chemicals used in a broad range of industries. Stepan is a leading merchant producer of surfactants, which are the key ingredients in consumer and industrial cleaning and disinfection products and in agricultural and oilfield solutions. The Company is also a leading supplier of polyurethane polyols used in the expanding thermal insulation market, and CASE (Coatings, Adhesives, Sealants, and Elastomers) industries.

Headquartered in Northbrook, Illinois, Stepan utilizes a network of modern production facilities located in North and South America, Europe and Asia.

The Company's common stock is traded on the New York Stock Exchange (NYSE) under the symbol SCL. For more information about Stepan Company please visit the Company online at www.stepan.com.

More information about Stepan's sustainability program can be found on the Sustainability page at www.stepan.com.

Certain information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include statements about Stepan Company's plans, objectives, strategies, financial performance and outlook, trends, the amount and timing of future cash distributions, prospects or future events and involve known and unknown risks that are difficult to predict. As a result, Stepan Company's actual financial results, performance, achievements or prospects may differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by the use of words such as "may," "could," "expect," "intend," "plan," "seek," "anticipate," "believe," "estimate," "guidance," "predict," "potential," "continue," "likely," "will," "would," "should," "illustrative" and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by Stepan Company and its management based on their knowledge and understanding of the business and industry, are inherently uncertain. These statements are not guarantees of future performance, and stockholders should not place undue reliance on forward-looking statements.

There are a number of risks, uncertainties and other important factors, many of which are beyond Stepan Company's control, that could cause actual results to differ materially from the forward-looking statements contained in this news release. Such risks, uncertainties and other important factors include, among other factors, the risks, uncertainties and factors described in Stepan Company's Form 10-K, Form 10-Q and Form 8-K reports and exhibits to those reports, and include (but are not limited to) risks and uncertainties related to accidents, unplanned production shutdowns or disruptions in manufacturing facilities; reduced demand due to customer product reformulations or new technologies; our inability to successfully develop or introduce new products; our ability to realize cost savings or operating efficiencies associated with strategic initiatives; compliance with laws; our ability to identify suitable acquisition candidates and successfully complete and integrate acquisitions; global competition; volatility of raw material and energy costs and supply; disruptions in transportation or significant changes in transportation costs; downturns in certain industries and general economic downturns; international business risks, including changes in global trade policies, tariffs, retaliatory measures and countermeasures, currency exchange controls and rate fluctuations, legal restrictions and taxes; unfavorable resolution of litigation against us; maintaining and protecting intellectual property rights; potential adverse tax consequences due to international scope of our business; downgrades in our credit ratings or our ability to access capital markets; global political, military, security or other instability and increased security regulations; costs, delays and miscalculations in capacity needs related to expansion or other capital projects; interruption or breaches of information technology systems; our ability to retain executive management and key personnel; and our debt covenants.

These forward-looking statements are made only as of the date hereof, and Stepan Company undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.

SOURCE Stepan Company

, /PRNewswire/ -- Stepan Company (NYSE: SCL) today reported:

First Quarter 2026 Highlights

Reported net income was a $41.4 million loss versus $19.7 million of income in the prior year.  The current year loss resulted from a previously announced $65.4 million pre-tax restructuring charge.   Adjusted net income(1) was $10.3 million, down 47% versus the prior year, largely due to lower Surfactant earnings and higher interest expense.  The higher interest expense reflects lower capitalized interest income due to the start-up of the Pasadena, TX site.  EBITDA(2)  was a negative $16.5 million versus $58.0 million in the prior year.  Current year EBITDA was negatively impacted by the $65.4 million restructuring charge.  Adjusted EBITDA(2) was $49.6 million, down 14% year-over-year. Organic sales volume was flat year-over-year as strong demand within Crop Productivity, Oilfield and Industrial Cleaning was offset by soft European Polymers demand.     Cash from Operations was $16.9 million during the quarter.  Free cash flow(3) for the quarter was a negative $14.0 million, driven by higher working capital requirements which are typical during the first quarter. Pre-tax earnings include a $65.4 million restructuring charge related to the previously announced closure of the Company's Fieldsboro, NJ site and select assets at its Elwood (Millsdale), IL and Stalybridge, UK facilities.  The cash impact associated with this restructuring charge was less than $1.0 million during the quarter. The Company has entered into an agreement to sell a parcel of land near its Millsdale site for $30 million.  This agreement is subject to customary closing conditions and the transaction is expected to close during the second half of the year. "We are executing Project Catalyst safely and in line with expectations despite early quarter weather-related impacts and the new geopolitical challenges.  Global adjusted EBITDA was down $7.9 million, or 14%, driven by our Surfactants business.  Surfactants EBITDA was down due to higher oleochemicals prices, the cold snap in the U.S., production timing differences in Asia along with competitive pressures in Mexico.  Polymers adjusted EBITDA grew 8% on the strength of North American volume growth and margin recovery that more than offset ongoing challenges within the European business.  Specialty Products volume was up 30% versus prior year while EBITDA was down due to product mix and higher raw material costs," said Luis E. Rojo, President and Chief Executive Officer.  "On a total Company basis, organic net sales, which exclude the impact of the asset divestiture in the Philippines, were up 4% and organic sales volume was flat year-over-year.  Strong growth in Crop Productivity, Oilfield and Industrial Cleaning was offset by European Polymers volume.  We are pleased with the growth we achieved in several of our key strategic end markets despite ongoing global economic uncertainties and supply chain disruptions.  We are continuing our efforts to further optimize our asset base and create a more productive and agile organization to enable balanced growth."       

Financial Summary

Three Months Ended
March 31,

($ in thousands, except per share data)

2026

2025

%
Change

Net Sales

$

604,509

$

593,255

2

%

Operating Income (Loss)

$

(49,622)

$

28,288

NM

Net Income (Loss)

$

(41,406)

$

19,711

NM

Earnings per Diluted Share

$

(1.81)

$

0.86

NM

Adjusted Net Income *

$

10,313

$

19,310

(47)

%

Adjusted Earnings per
   Diluted Share *

$

0.45

$

0.84

(46)

%

* See Table II for reconciliations of non-GAAP adjusted net income and adjusted earnings per diluted share.

Percentage Change in Net Sales

Net sales in the first quarter of 2026 increased 2% year-over-year.  This increase reflects higher selling prices and the favorable impact of foreign currency translation.  A 3% decline in sales volume partially offset the above.  Organic volume was flat and organic net sales were up 4% year-over-year. 

Three Months Ended
March 31, 2026

Volume

(3)

%

Selling Price & Mix

1

%

Foreign Translation

4

%

Total

2

%

Segment Results

Three Months Ended
March 31,

($ in thousands)

2026

2025

%
Change

Net Sales

Surfactants

$

453,687

$

430,337

5

%

Polymers

$

130,029

$

146,116

(11)

%

Specialty Products

$

20,793

$

16,802

24

%

Total Net Sales

$

604,509

$

593,255

2

%

Three Months Ended
March 31,

($ in thousands, all amounts pre-tax)

2026

2025

%
Change

Operating Income (Loss)

Surfactants

$

18,548

$

28,930

(36)

%

Polymers

$

8,822

$

8,018

10

%

Specialty Products

$

4,715

$

5,508

(14)

%

Total Segment
   Operating Income

$

32,085

$

42,456

(24)

%

Corporate Expenses

$

(81,707)

$

(14,168)

477

%

Consolidated
   Operating Income (Loss)

$

(49,622)

$

28,288

(275)

%

Three Months Ended
March 31,

($ in millions)

2026

2025

%
Change

EBITDA

$

(16.5)

$

58.0

(128)

%

Adjusted EBITDA

   Surfactants

$

41.1

$

48.3

(15)

%

   Polymers

$

17.4

$

16.1

8

%

   Specialty Products

$

6.2

$

7.0

(11)

%

   Unallocated Corporate

$

(15.1)

$

(13.9)

9

%

Consolidated Adjusted EBITDA

$

49.6

$

57.5

(14)

%

Consolidated adjusted EBITDA(2) decreased $7.9 million, or 14%, in the quarter.  This  was primarily due to lower Surfactant earnings resulting from a 2% decline in sales volume, competitive pressures in Mexico and production timing differences in Asia.         

Surfactant net sales were $453.7 million for the quarter, up 5% versus the prior year.  Selling prices were up 2% primarily due to pass through of higher raw material costs, improved product and customer mix, along with pricing actions.  Organic sales volume was up 2%, driven by strong demand within the Industrial Cleaning, Oilfield and Crop Productivity end markets.  Total sales volume declined 2%  due to the Philippines divestiture in the fourth quarter of 2025.  The Company achieved volume growth in all global regions except Asia.  Foreign currency translation positively impacted net sales by 5%.  Surfactant adjusted EBITDA(2)  for the quarter decreased $7.2 million, or 15%, versus the prior year.  This decrease was primarily due to higher overhead due to production timing differences in Asia, competitive pressures in Mexico, the severe cold snap in the U.S. and higher oleochemicals raw material costs. Polymer net sales were $130.0 million for the quarter, an 11% decrease versus the prior year.  Selling prices decreased 8%, primarily due to the pass-through of lower raw material costs and competitive pressures.  Sales volume decreased 6% in the quarter.  North American sales volume was up 5% but this was more than offset by a 19% decline in Europe.  Foreign currency translation positively impacted net sales by 3% during the quarter.  Polymer adjusted EBITDA(2) increased $1.3 million, or 8%, versus the prior year primarily due to global margin improvement. Specialty Products net sales were $20.8 million for the quarter, a 24% increase versus the prior year, primarily due to higher sales volume.  Specialty Products adjusted EBITDA(2) decreased $0.8 million, or 11%.  The decrease in adjusted EBITDA(2) was primarily due to product mix and lower margins within the medium chain triglycerides product line due to higher raw material costs.  Outlook

"We are executing on Project Catalyst, which is our comprehensive plan designed to further optimize our asset base and create a more productive and agile organization to enable growth.  During the first quarter we executed our plans to close our Fieldsboro, NJ site and decommission select assets at our Millsdale, IL and Stalybridge, UK facilities,"  said Luis E. Rojo, President and Chief Executive Officer.  "We believe we are positioned to continue delivering growth in all our key strategic businesses such as Crop Productivity, Oilfield, Tier 2/3 Surfactants and North American Polymers.  With our actions on growth, productivity and cash, we believe we will deliver full year Adjusted EBITDA growth, positive free cash flow and continue to de-leverage the balance sheet in 2026, despite the ongoing and significant market uncertainties and challenges."

Notes

(1) Adjusted net income and adjusted earnings per share are non-GAAP measures which exclude deferred compensation income/expense, certain environmental remediation-related costs as well as other significant and infrequent/non-recurring items. See Table II for reconciliations of non-GAAP adjusted net income and adjusted earnings per diluted share.

(2) EBITDA and adjusted EBITDA are non-GAAP measures.  See Table VI for calculations and GAAP reconciliations of EBITDA and adjusted EBITDA.

(3) Free cash flow is a non-GAAP measure and reflects cash generated from operations minus capital expenditures.  Cash generated from operations was $16.9 million during the first quarter of 2026 and capital expenditures were $30.9 million. 

Conference Call

Stepan Company will host a conference call to discuss its first quarter results at 8:00 a.m. ET (7:00 a.m. CT) on April 28, 2026. The call can be accessed by phone and webcast. To access the call by phone, please click on this Registration Link, complete the form and you will be provided with dial in details and a PIN.  To avoid delays, we encourage participants to dial into the conference call ten minutes ahead of the scheduled start time.  The webcast can be accessed through the Investors/Conference Calls page at www.stepan.com. A webcast replay of the conference call will be available at the same location shortly after the call.

Supporting Slides

Slides supporting this press release will be made available at www.stepan.com through the Investors/Presentations page at approximately the same time as this press release is issued.

Corporate Profile

Stepan Company is a major manufacturer of specialty and intermediate chemicals used in a broad range of industries. Stepan is a leading merchant producer of surfactants, which are the key ingredients in consumer and industrial cleaning and disinfection compounds and in agricultural and oilfield solutions. The Company is also a leading supplier of polyurethane polyols used in the expanding thermal insulation market, and CASE (Coatings, Adhesives, Sealants, and Elastomers) industries.

Headquartered in Northbrook, Illinois, Stepan utilizes a network of modern production facilities located in North and South America, Europe and Asia. 

The Company's common stock is traded on the New York Stock Exchange (NYSE) under the symbol SCL. For more information about Stepan Company please visit the Company online at www.stepan.com 

More information about Stepan's sustainability program can be found on the Sustainability page at www.stepan.com

Certain information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include statements about Stepan Company's plans, objectives, strategies, financial performance and outlook, trends, the amount and timing of future cash distributions, prospects or future events and involve known and unknown risks that are difficult to predict. As a result, Stepan Company's actual financial results, performance, achievements or prospects may differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by the use of words such as "may," "could," "expect," "intend," "plan," "seek," "anticipate," "believe," "estimate," "guidance," "predict," "potential," "continue," "likely," "will," "would," "should," "illustrative" and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by Stepan Company and its management based on their knowledge and understanding of the business and industry, are inherently uncertain. These statements are not guarantees of future performance, and stockholders should not place undue reliance on forward-looking statements.

There are a number of risks, uncertainties and other important factors, many of which are beyond Stepan Company's control, that could cause actual results to differ materially from the forward-looking statements contained in this news release. Such risks, uncertainties and other important factors include, among other factors, the risks, uncertainties and factors described in Stepan Company's Form 10-K, Form 10-Q and Form 8-K reports and exhibits to those reports, and include (but are not limited to) risks and uncertainties related to  accidents, unplanned production shutdowns or disruptions in manufacturing facilities; reduced demand due to customer product reformulations or new technologies; our inability to successfully develop or introduce new products; our ability to realize cost savings or operating efficiencies associated with strategic initiatives; compliance with laws; our ability to identify suitable acquisition candidates and successfully complete and integrate acquisitions; global competition; volatility of raw material and energy costs and supply; disruptions in transportation or significant changes in transportation costs; downturns in certain industries and general economic downturns; international business risks, including changes in global trade policies, tariffs, retaliatory measures and countermeasures, currency exchange rate fluctuations, legal restrictions and taxes; unfavorable resolution of litigation against us; maintaining and protecting intellectual property rights; potential adverse tax consequences due to the international scope of our business; downgrades in our credit ratings or our ability to access capital markets; global political, military, security or other instability and increased security regulations; costs, delays and miscalculations in capacity needs related to expansion or other capital projects; interruption or breaches of information technology systems; our ability to retain executive management and key personnel; and our debt covenants.  In addition to the risks described in the Company's periodic reports, the restructuring actions described herein may involve risks related to the execution of facility closures and asset decommissioning, potential operational disruptions, impacts on employees and local communities, environmental compliance, and the realization of anticipated cost savings and efficiencies.

These forward-looking statements are made only as of the date hereof, and Stepan Company undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by applicable laws.

* * * * *

Tables follow

Table I

STEPAN COMPANY

For the Three Months Ended March 31, 2026 and 2025

(Unaudited – in 000's, except per share data)

Three Months Ended
March 31,

2026

2025

Net Sales

$

604,509

$

593,255

Cost of Sales

539,658

517,792

Gross Profit

64,851

75,463

Operating Expenses:

Selling

12,166

12,108

Administrative

21,313

21,414

Research, Development and Technical Services

14,993

14,649

Deferred Compensation Expense

562

(996)

49,034

47,175

Business Restructuring

65,439

-

Operating Income (Loss)

(49,622)

28,288

Other Income (Expense):

Interest, Net

(5,011)

(4,126)

Other, Net

144

502

(4,867)

(3,624)

Income (Loss) Before Provision for Income Taxes

(54,489)

24,664

Provision for Income Taxes

(13,083)

4,953

Net Income (Loss)

(41,406)

19,711

Net Income (Loss) Per Common Share

Basic

$

(1.81)

$

0.86

Diluted

$

(1.81)

$

0.86

Shares Used to Compute Net Income Per
   Common Share

Basic

22,888

22,867

Diluted

22,888

22,890

Table II

Reconciliation of Non-GAAP Net Income (Loss) and Earnings per Diluted Share*

Three Months Ended
March 31,

($ in thousands, except per share amounts)

2026

EPS

2025

EPS

Net Income (Loss) Reported

$

(41,406)

$

(1.81)

$

19,711

$

0.86

Deferred Compensation (Income) Expense

$

477

$

0.02

$

(470)

$

(0.02)

Environmental Remediation
    Expense

$

78

$

0.00

$

69

$

0.00

Business Restructuring

$

51,164

$

2.24

$

-

$

-

Adjusted Net Income

$

10,313

$

0.45

$

19,310

$

0.84

* All amounts in this table are presented after-tax

The Company believes that certain non-GAAP measures, in conjunction with comparable GAAP measures, are useful for evaluating the Company's operating performance and financial condition.  The Company uses this non-GAAP information as an indicator of business performance and evaluates management's effectiveness with specific reference to these indicators.  Management believes that these non-GAAP financial measures provide useful supplemental information because they exclude non-operational items that affect comparability between years.  These measures should be considered in addition to, not as substitutes for or superior to, measures of financial performance prepared in accordance with GAAP and may differ from similarly titled measures presented by other companies.  The Company's Annual Report on Form 10-K for the year ended December 31, 2025 contains additional information regarding the use of non-GAAP financial measures.

Summary of First Quarter 2026 Adjusted Net Income Items

Adjusted net income excludes non-operational deferred compensation income/expense, certain environmental remediation costs and other significant and infrequent or non-recurring items.

Deferred Compensation: The first quarter of 2026 reported net income includes $0.5 million of after-tax expense versus $0.5 million of after-tax income in the prior year. Environmental Remediation: The first quarter of 2026 reported net income includes $0.1 million of after-tax expense versus $0.1 million of after-tax expense in the prior year. Business Restructuring: The first quarter of 2026 reported net income includes $51.2 million of after-tax expense related to restructuring charges.  There were no restructuring charges recognized in the prior year quarter. Table III

Reconciliation of Pre-Tax to After-Tax Adjustments

Management uses the non-GAAP adjusted net income metric to evaluate the Company's operating performance.  Management excludes the items listed in the table below because they are non-operational items.  The cumulative tax effect is typically calculated using the statutory tax rates for the jurisdictions in which the transactions occurred.

Three Months Ended
March 31,

($ in thousands, except per share amounts)

2026

EPS

2025

EPS

Pre-Tax Adjustments

Deferred Compensation (Income) Expense

$

628

$

(626)

Environmental Remediation Expense

$

102

$

92

Business Restructuring

$

65,439

$

-

   Total Pre-Tax Adjustments

$

66,169

$

(534)

Cumulative Tax Effect on Adjustments

$

(14,450)

$

133

After-Tax Adjustments

$

51,719

$

2.26

$

(401)

$

(0.02)

Table IV

Deferred Compensation Plans

The full effect of the deferred compensation plans on quarterly pre-tax income was $0.6 million of expense versus $0.6 million of income in the prior year.  The quarter-end market prices of Company stock and the impact of deferred compensation on specific income statement line items is summarized below:

2026

2025

3/31

12/31

9/30

6/30

3/31

Stepan Company

$

49.98

$

47.36

$

47.70

$

54.58

$

55.04

Three Months Ended
March 31,

($ in thousands)

2026

2025

Deferred Compensation

Operating Income (Expense)

$

(562)

$

996

Other, net – Mutual Fund Gain (Loss)

(66)

(370)

Total Pre-Tax

$

(628)

$

626

Total After-Tax

$

(477)

$

470

Effects of Foreign Currency Translation

The Company's foreign subsidiaries transact business and report financial results in their respective local currencies. These results are translated into U.S. dollars at average foreign exchange rates appropriate for the reporting period.  The table below presents the impact that foreign currency translation had on select income statement line items. 

($ in millions)

Three Months Ended
March 31,

Change

Change
Due to
Foreign
Currency
Translation

2026

2025

Net Sales

$

604.5

$

593.3

$

11.2

$

25.3

Gross Profit

64.9

75.5

$

(10.6)

2.5

Operating Income

(49.6)

28.3

$

(77.9)

1.3

Pretax Income

(54.5)

24.7

$

(79.2)

1.4

Corporate Expenses

Three Months Ended
March 31,

($ in thousands)

2026

2025

%
Change

Total Corporate Expenses

$

81,707

$

14,168

477

%

Less:

   Deferred Compensation (Income) Expense

$

562

$

(996)

(156)

%

   Environmental Remediation
      Expense

$

102

$

92

11

%

   Business Restructuring

$

65,439

$

-

NM

Adjusted Corporate Expenses

$

15,604

$

15,072

4

%

Table V

Stepan Company

Consolidated Balance Sheets

March 31, 2026 and December 31, 2025

March 31, 2026

December 31,
2025

ASSETS

Current Assets

$

906,238

$

858,959

Property, Plant & Equipment, Net

1,148,164

1,219,627

Other Assets

278,935

279,116

Total Assets

$

2,333,337

$

2,357,702

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities

$

720,453

$

666,494

Deferred Income Taxes

11,052

11,450

Long-term Debt

328,415

340,975

Other Non-current Liabilities

80,393

94,773

Total Stepan Company Stockholders' Equity

1,193,024

1,244,010

Total Liabilities and Stockholders' Equity

$

2,333,337

$

2,357,702

Selected Balance Sheet Information

The Company's total debt increased by $25.0 million and cash increased by $8.1 million versus December 31, 2025.  The Company's net debt level increased $16.9 million versus December 31, 2025 and its net debt ratio was 30% versus 28% in the prior quarter (Net Debt and Net Debt Ratio are non-GAAP measures, reconciliations of which are shown in the table below).  Management uses the non-GAAP net debt metric to show a more complete picture of the Company's overall liquidity, financial flexibility and leverage level.

($ in millions)

March 31,
2026

December 31,
2025

Net Debt

Total Debt

$

651.7

$

626.7

Cash

140.8

132.7

Net Debt

$

510.9

$

494.0

Equity

1,193.0

1,244.0

Net Debt + Equity

$

1,703.9

$

1,738.0

Net Debt / (Net Debt + Equity)

30

%

28

%

The major working capital components were:

($ in millions)

March 31,
2026

December 31,
2025

Net Receivables

$

433.7

$

388.0

Inventories

289.0

298.8

Accounts Payable

(285.7)

(261.7)

$

437.0

$

425.1

Table VI

Reconciliations of Non-GAAP EBITDA and Adjusted EBITDA

Management uses the non-GAAP EBITDA and adjusted EBITDA metrics to evaluate the Company's operating performance.  Management excludes the items listed in the table below because they are non-operational items.  Refer to the Income Statement on Table I for a bridge between Operating Income and Net Income.

Three Months Ended
March 31, 2026

($ in millions)

Surfactants

Polymers

Specialty
Products

Unallocated
Corporate

Consolidated

Operating Income (Loss)

$

18.5

$

8.8

$

4.7

$

(81.7)

$

(49.6)

   Depreciation and Amortization

22.6

8.6

1.5

0.4

33.0

   Other, Net Income

-

-

-

0.1

0.1

EBITDA

$

(16.5)

   Deferred Compensation

-

-

-

0.6

0.6

   Environmental Remediation

-

-

-

0.1

0.1

   Business Restructuring

-

-

-

65.4

65.4

Adjusted EBITDA

$

41.1

$

17.4

$

6.2

$

(15.1)

$

49.6

Three Months Ended
March 31, 2025

($ in millions)

Surfactants

Polymers

Specialty
Products

Unallocated
Corporate

Consolidated

Operating Income

$

28.9

$

8.0

$

5.5

$

(14.2)

$

28.2

   Depreciation and Amortization

19.4

8.1

1.5

0.3

29.3

   Other, Net Income

-

-

-

0.5

0.5

EBITDA

$

58.0

   Deferred Compensation

-

-

-

(0.6)

(0.6)

   Environmental Remediation

-

-

-

0.1

0.1

Adjusted EBITDA

$

48.3

$

16.1

$

7.0

$

(13.9)

$

57.5

SOURCE Stepan Company