Q2 2025 Stepan Co Earnings Call Transcript
Key Points
- Stepan Co (SCL) reported a second quarter adjusted EBITDA of $51.4 million, up 8% compared to the previous year.
- The company experienced double-digit growth in its crop productivity business, which helped offset significant raw material inflation.
- Volume growth was observed in key strategic markets, including a 7% increase in polymers and a 49% increase in the NCT product line.
- The new Pasadena, Texas site is ramping up production and is expected to provide incremental benefits in the second half of the year.
- Stepan Co (SCL) has paid and increased its dividends for 57 consecutive years, demonstrating a strong commitment to returning value to shareholders.
- Significant increases in oil chemical raw material prices have impacted surfactant margins.
- The company faced higher startup expenses at the new Pasadena site and an environmental remediation reserve adjustment at the Millsdale site.
- Cash flow from operations was negative at $14.4 million due to inventory building in anticipation of tariffs and to provide safety stock.
- Foreign currency translation negatively impacted net sales by 2%.
- The surfactant business experienced a 1% decline in sales volume due to lower demand within the global commodity consumer product markets.
Good morning and welcome to the Stepan Company's second quarter 2025 earnings conference call. During the presentation, all participants will be in a listen-only mode. Afterward, we will conduct a question and answer session. [Operator Instructions]. As a reminder, this call is being recorded on Wednesday, July 30, 2025.
It is now my pleasure to turn the call over to Mr. Ruben Velasquez, Vice President and Chief Financial Officer of Stepan Company. Mr. Velasquez, please go ahead.
Good morning and thank you for joining us Stepan Company's second quarter 2025 Financial Review.
Before we begin, please note that information in this conference call contains forward-looking statements which are not historical facts.
These statements involve risk and uncertainties that could cost actual results to different material, including but not limited to prospects for our foreign operations, global and regional economic conditions, and factors detailed in our Securities and
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