NYSE$SCL

Stepan Company · Q1 2021 earnings

Q1 2021 earnings · · Investor relations

Briefing

Stepan had a record quarterly earnings, driven by improved product and customer mix and higher global demand.

Stepan Company reported record net income of $40.6 million, or $1.74 per diluted share, and adjusted net income of $42.4 million, or $1.82 per diluted share. Total Company sales volume increased 6% versus the prior year. The company exceeded $1 billion of equity for the first time.

  • Net income was a record $40.6 million, or $1.74 per diluted share versus $27.5 million, or $1.18 per diluted share, in the prior year.
  • Adjusted net income was a record $42.4 million, or $1.82 per diluted share versus $24.2 million, or $1.04 per diluted share, in the prior year.
  • Surfactant operating income was $53.2 million versus $36.2 million in the prior year, driven by improved product and customer mix and higher global demand.
  • Polymer operating income was $18.0 million versus $7.5 million in the prior year, attributable to a 32% increase in global sales volume.

Headline financials

Total Revenue

$538M

Previous: $450M+19.5%
EPS (adj)

$1.82

Previous: $1.04+75.0%
Capital Expenditures

-$37.6M

Previous: -$33.2M-13.3%
Free Cash Flow

$2.98M

Previous: -$5.66M+152.7%
Net Income

$40.6M

Previous: $27.5M+47.4%
Operating Income

$53.9M

Previous: $40M+34.8%
Gross Profit

$109M

Previous: $79.3M+37.5%
Cash & Equivalents

$151M

Previous: $254M-40.8%
Total Assets

$1.83B

Previous: $1.51B+21.4%
Stock-Based Comp

$2.54M

Previous: $1.2M+111.2%

Revenue & EPS history

Stepan · Revenue · Quarterly

$538M

Q1 2021+19.5%vs Q1 2020
Beat estimate in 14 of 16 quarters(88%)
ActualEstimate

Revenue by segment

Stepan · $538M total across 3 segments · Q1 2021

  • Surfactants
    $371M+13.4%
  • Polymers
    $150M+41.2%
  • Specialty Products
    $16.4M-0.0%

Forward guidance

The Company delivered record quarterly earnings in the first quarter of 2021 and is cautiously optimistic about the remainder of the year.

Tailwinds

  • Surfactant volumes in the North American consumer product end markets should recover following the supply chain disruptions caused by the severe weather in Texas.
  • Heightened consumer demand for disinfection, cleaning and personal wash products will continue.
  • Demand for surfactants within the agricultural and oilfield markets will improve versus 2020.
  • Global demand for rigid polyols continues to recover from pandemic-related delays and cancellations of re-roofing and new construction projects.
  • The acquisition of INVISTA’s aromatic polyester polyol business should position our Polymer business to deliver growth versus prior year.

Headwinds

  • Raw material price increases
  • Supply constraints
  • Lower margins within our MCTs product line
  • The Company experienced lower supply chain expenses in the current year quarter due to the non-recurrence of the Q1 2020 Millsdale plant power outage
  • Specialty Product business results were down due to lower margins within our MCTs product line.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2021

Historical avgQ1 2021

-0.5%

Avg return

Earnings day

-1.1%

Avg return

5 days after

-0.7%

Avg return

30 days after

43%

28 / 65 earnings

Positive

+12.4%

Q1 2015

Best reaction

-20.4%

Q4 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.1%-0.7%-2.7%
Q4 2025-20.4%-24.3%-25.2%
Q3 2025-0.4%-4.1%+2.2%
Q1 2025+7.1%+13.8%+15.2%
Q4 2024+0.1%-0.0%-7.3%
Q3 2024-0.8%-0.2%+5.4%
Q2 2024-11.0%-18.9%-13.8%
Q1 2024-0.6%+1.4%+0.2%
Q4 2023-2.5%-2.3%-3.2%
Q3 2023+7.9%+9.1%+18.7%
Q2 2023-3.8%-0.6%-10.1%
Q1 2023-10.2%-7.2%-5.8%
Q4 2022-2.4%-4.5%-13.3%
Q3 2022-2.9%-0.3%+10.5%
Q2 2022+8.6%+5.4%+2.0%
Q1 2022+4.9%+3.9%+11.7%
Q4 2021-3.5%-5.6%-9.7%
Q3 2021+2.4%+1.2%+1.9%
Q2 2021-0.1%+0.2%-1.0%
Q1 2021-0.7%-0.8%+2.1%
Q4 2020-2.9%-2.1%+4.7%
Q3 2020-0.5%+2.0%+7.0%
Q2 2020+7.5%+7.6%+12.8%
Q1 2020-1.9%-0.3%+4.8%
Q4 2019-1.6%-8.3%-26.6%
Q3 2019+0.1%+3.6%+1.4%
Q2 2019+3.7%+3.2%-2.0%
Q1 2019-0.2%-0.2%-6.2%
Q4 2018+1.5%+0.9%-7.7%
Q3 2018+3.0%+1.0%-2.1%
Q2 2018+5.3%+6.4%+8.8%
Q1 2018-17.2%-18.5%-20.0%
Q4 2017+5.8%+10.3%+11.3%
Q3 2017-7.0%-7.3%-4.3%
Q2 2017-7.2%-10.2%-15.9%
Q1 2017+9.7%+4.8%+7.4%
Q4 2016-10.3%-5.9%-0.7%
Q3 2016+6.6%+2.9%+11.9%
Q2 2016+4.2%+2.4%+11.6%
Q1 2016+6.6%
Q4 2015+12.0%
Q3 2015+8.8%
Q2 2015-10.6%
Q1 2015+12.4%
Q4 2014-0.6%
Q3 2014-5.2%
Q2 2014-1.5%
Q1 2014-1.7%
Q4 2013-5.1%
Q3 2013+0.6%
Q2 2013+0.7%
Q1 2013-11.4%
Q2 2010-0.5%
Q4 2012-0.1%
Q3 2012-3.8%
Q2 2012-8.0%
Q1 2011+3.6%
Q1 2012+3.9%
Q4 2009+4.7%
Q4 2011+4.7%
Q3 2011-4.5%
Q3 2010-4.5%
Q4 2010-2.0%
Q2 2011-2.0%
Q1 2010+1.7%

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