NYSE$SCL

Stepan Company · Q2 2022 earnings

Q2 2022 earnings · · Investor relations

Briefing

Stepan achieved record results driven by margin recovery, improved mix, and sales volume growth.

Stepan Company reported a record second quarter with net income reaching $52.1 million, or $2.26 per diluted share, compared to $43.3 million, or $1.85 per diluted share, in the previous year. Adjusted net income was a record $53.0 million, or $2.30 per diluted share, versus $42.2 million, or $1.81 per diluted share, in the prior year. The company experienced a slight decline in total sales volume by 1% year-over-year, but this was offset by higher selling prices and improved product mix.

  • Net income was a record $52.1 million, or $2.26 per diluted share, versus $43.3 million, or $1.85 per diluted share, in the prior year.
  • Adjusted net income was a record $53.0 million, or $2.30 per diluted share, versus $42.2 million, or $1.81 per diluted share, in the prior year.
  • Surfactant operating income was $48.2 million versus $45.9 million in the prior year, driven by improved product and customer mix.
  • Polymer operating income was a record $33.9 million versus $23.0 million in the prior year, attributable to margin recovery, improved mix, and a 2% increase in global sales volume.

Headline financials

Total Revenue

$752M

Previous: $596M+26.2%
EPS (adj)

$2.30

Previous: $1.81+27.1%
Surfactant Operating Income

$48.2M

Previous: $45.9M+5.1%
Polymer Operating Income

$33.9M

Previous: $23M+47.3%
Specialty Product Op Income

$9.87M

Previous: $6.98M+41.4%
Capital Expenditures

-$129M

Previous: -$74.9M-72.9%
Free Cash Flow

-$77.3M

Previous: -$31.6M-144.8%
Net Income

$52.1M

Previous: $43.3M+20.4%
Operating Income

$77.6M

Previous: $56.7M+37.0%
Gross Profit

$132M

Previous: $112M+17.8%
Cash & Equivalents

$195M

Previous: $127M+53.2%
Total Assets

$2.29B

Previous: $1.89B+21.3%
Stock-Based Comp

$4M

Previous: $2.81M+42.4%

Revenue & EPS history

Stepan · Revenue · Quarterly

$752M

Q2 2022+26.2%vs Q2 2021
Beat estimate in 9 of 15 quarters(60%)
ActualEstimate

Revenue by segment

Stepan · $752M total across 3 segments · Q2 2022

  • Surfactants
    $485M+26.3%
  • Polymers
    $239M+25.4%
  • Specialty Products
    $27.7M+31.9%

Forward guidance

Stepan expects healthy demand across its businesses but anticipates continued challenges from inflation, raw material, and logistics constraints.

Tailwinds

  • Surfactant volumes within the Functional Products end markets will show full year growth over 2021 supported by continued elevated crop and energy prices.
  • Polymers will deliver growth versus the prior year as energy conservation efforts and more stringent building codes should have a continued positive impact on demand for our Rigid polyols.
  • Specialty Product results should show year over year improvement as well.

Headwinds

  • The Company will continue to be challenged by inflation.
  • Raw material constraints are expected to continue.
  • Logistics constraints are expected to continue.

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 Q2 2022

Historical avgQ2 2022

-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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