Stepan Reports Second Quarter 2026 Results
NORTHBROOK, Ill., July 29, 2026 /PRNewswire/ -- Stepan Company (NYSE: SCL) today reported:
Second Quarter 2026 Highlights
First Half 2026 Highlights
"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.
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.
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