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Stepan Company Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: August 3, 2012 12:24PM
Stepan Company (SCL) filed Quarterly Report for the period ended 2012-06-30. Stepan Company has a market cap of $916.2 million; its shares were traded at around $89.57 with a P/E ratio of 12.5 and P/S ratio of 0.5. The dividend yield of Stepan Company stocks is 1.3%. Stepan Company had an annual average earning growth of 9.4% over the past 10 years.
Highlight of Business Operations:Consolidated net sales declined $6.8 million, or one percent, quarter over quarter. The effects of foreign currency translation and a decline in average selling prices accounted for approximately $17.5 million and $12.1 million, respectively, of the decrease. Sales volume improved five percent, which offset the impact of currency translation and lower prices by $22.8 million. The decline in average selling prices reflected reduced quarter-over-quarter commodity raw material costs. The sales volume growth was driven by a six percent increase for the surfactants segment. Specialty products sales volume was up between quarters due to the Lipid Nutrition business that was acquired in June of 2011. Polymers sales volume declined one percent primarily due to lower phthalic anhydride sales.
Surfactants net sales for the second quarter of 2012 declined $8.7 million, or three percent, from net sales for the second quarter of 2011. Decreased average selling prices and the unfavorable effects of foreign currency translation accounted for approximately $17.1 million and $12.8 million, respectively, of the net sales change. Sales volume increased six percent quarter over quarter, which offset the effects of lower prices and foreign currency translation by $21.2 million.
Polymers net sales for the second quarter of 2012 declined $6.9 million, or six percent, from net sales for the same quarter of 2011. The effects of foreign currency translation, lower average selling prices and a one percent decrease in sales volume accounted for $4.7 million, $1.3 million and $0.9 million, respectively, of the decline. A quarter-over-quarter comparison of net sales by region is displayed below:
Consolidated net sales increased $35.9 million, or four percent, year over year. Higher sales volumes and average selling prices accounted for approximately $40.5 million and $17.9 million, respectively, of the increase. Foreign currency translation had a $22.5 million unfavorable effect on the year-over-year net sales change. Sales volume improved five percent between years, reflecting increases for all three segments. Higher year-over-year raw material costs and a more favorable sales mix accounted for the increase in average selling prices.
Surfactants net sales for the first half of 2012 increased $13.6 million, or two percent, over net sales for the same period of 2011. The increase was driven by a five percent increase in sales volume, which accounted for $32.8 million of the net sales change. The unfavorable effects of foreign currency translation and a decline in average selling prices reduced the year-over-year net sales change by $16.7 million and $2.5 million, respectively. A year-over-year comparison of net sales by region follows:
Stocks Discussed: SCL,