Stepan Company ( (SCL) ) has released its Q3 earnings. Here is a breakdown of the information Stepan Company presented to its investors.
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Stepan Company, a leading manufacturer of specialty and intermediate chemicals, operates primarily in the surfactants and polymers industries, providing essential ingredients for consumer and industrial cleaning products, as well as polyurethane polyols for thermal insulation and CASE industries.
In the third quarter of 2025, Stepan Company reported a significant decrease in net income, falling 54% year-over-year to $10.8 million. Despite this decline, the company saw a 6% increase in both EBITDA and adjusted EBITDA, reaching $56.1 million and $56.2 million, respectively. Global sales volume rose by 1%, and free cash flow improved to $40.2 million due to reduced working capital.
Key financial metrics highlighted a mixed performance across segments. Surfactants saw a 10% increase in net sales driven by higher selling prices, although adjusted EBITDA declined by 14% due to startup costs at the new alkoxylation site in Pasadena, Texas. Polymer sales decreased by 4% due to lower selling prices, but volume increased by 8%. Specialty Products experienced a 68% surge in net sales, significantly boosting adjusted EBITDA by 113% due to order timing in the pharmaceutical business.
Looking ahead, Stepan Company remains focused on enhancing operational excellence and improving product and customer mix. The company anticipates continued growth in its surfactant business and expects polymer demand to improve as market conditions stabilize. The management is optimistic about achieving full-year adjusted EBITDA growth and generating positive free cash flow in 2025, despite ongoing market uncertainties.