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Stepan Company (SCL) Q3 2026 Earnings Report
SCL Q3 2026 EPS Results
- Actual EPS
- $0.94
- Consensus EPS
- $0.73
- Beat/Miss
- Beat by +$0.21
- One Year Ago EPS
- $0.48
SCL Q3 2026 Revenue Results
- Actual Revenue
- $692.15M
- Expected Revenue
- $634.30M
- Beat/Miss
- Beat by +$57.85M
- YoY Revenue Growth
- +17.26%
Earnings Announcement Details
- Quarter
- Q3 2026
- Date
- 10/28/2026
- Time
- Before Open
- Conference Call
- Wednesday, October 28, 2026
Stepan Company's next earnings date is estimated for February 18, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
Q3 2026 Earnings Slide Deck
Q3 2026 Earnings Call Summary
The call was strongly positive overall. Highlights significantly outweighed the challenges, with broad-based volume and earnings growth, higher margins, savings ahead of plan, improved leverage, positive free cash flow, customer expansion, and a positive full-year outlook. The main negatives were raw material and geopolitical volatility, working capital usage, restructuring and maintenance costs, weaker European and Asian demand, lower crop productivity demand, and expected moderation in fourth-quarter volume growth.
For 2026, Stepan expects to exceed the 60% 2-year $100 million pretax savings target, with Project Catalyst savings in the $66 million to $70 million range, versus a $23 million run rate in Q3; for 2027, it expects to be ahead of $25 million on average, with savings ahead of $25 million in the second half and slightly below $25 million in the first half. The company expects lower growth in Q4, and its fixed cost base is roughly $800 million, with normal inflation of 2%-3% on that base. Pasadena utilization is in the 75%-80% range, with more tolling savings expected in the second half than the first half of next year. For 2026, the company expects full year adjusted EBITDA growth, positive free cash flow, and continued deleveraging of the balance sheet.
- Broad-Based Earnings GrowthAll three segments delivered organic volume growth and increased earnings versus the prior year. Adjusted EBITDA was $66.3 million, up $10.1 million or 18%, while adjusted net income was $21.7 million, or $0.94 per diluted share, up 98% from $10.9 million or $0.48 per diluted share.
- Strong Organic Volume GrowthOrganic volume grew 7% in the quarter, with growth in all three segments: Surfactants increased 8%, Polymers increased 3%, and Specialty Products increased 20%. Organic volume growth was 4% for the first nine months, which management described as nearly a record.
- Surfactants PerformanceSurfactants net sales were $487 million, up 15%, and adjusted EBITDA was $48 million, up $10 million or 27%. Organic volume increased 8%, led by double-digit growth in consumer products, construction, industrial, and oilfield markets. North America, Asia, and Latin America benefited from volume growth and margin recovery.
- Polymers Growth Led by North AmericaPolymers net sales were $179 million, up 24%, while volume increased 3% and adjusted EBITDA rose 4% to $23 million. North American volume grew by a strong double-digit percentage, driven by rigid polyols, phthalic anhydride, and continued significant growth in spray foam.
- Specialty Products and MCT ExpansionSpecialty Products net sales increased 12% to $27 million, volume increased 20%, and adjusted EBITDA rose 5% to $11.7 million. Growth was primarily driven by higher volume in the MCT product line, supported by expanded offerings, a new innovation program, and additional capacity.
- Pricing and Margin RecoveryPricing actions and disciplined execution of contractual pass-through mechanisms offset higher raw material costs. Surfactants reported selling prices up 10%, primarily from raw material pass-through and targeted pricing actions, while Polymers selling prices increased 22%, primarily due to raw material cost pass-through.
- Project Catalyst Savings Ahead of PlanProject Catalyst savings reached an approximately $23 million quarterly run rate in the third quarter. Management expects to exceed the 60% portion of the two-year $100 million pretax savings target in 2026, with the 2026 savings range estimated at $66 million to $70 million. The company identified actions expected to support savings ahead of $25 million per quarter on average in 2027.
- Improved Leverage and Balance Sheet ProgressNet leverage improved to 2.4x from 2.7x a year ago, reflecting continued deleveraging and improved cash flow. Net debt ended the quarter at $536 million. The company also closed the sale of land near its Millsdale site for $28.5 million, with proceeds to be used to pay down debt and continue deleveraging.
- Positive Free Cash FlowFree cash flow was positive at $8 million after $21 million of capital expenditures, despite a $32 million working capital build and $6 million of restructuring-related cash payments. Cash flow from operations before working capital was $49 million.
- Dividend Increase and Capital AllocationThe company paid $9 million in dividends and increased its quarterly dividend by $0.01 per share, or 2.5%. This marked the 59th consecutive year of dividend increases. Management also stated that it executed its capital plan across its sites while continuing to invest in working capital.
- Customer and Product ExpansionYear to date, the Surfactants business added more than 300 new customers and delivered nearly 900 new customer and product combinations. The global Tier 2 and Tier 3 customer base grew at a double-digit rate, while the company continued to perform well with Tier 1 multinational accounts.
- Manufacturing Network ProgressThe NeoGeld site had a strong quarter for production volumes and improved all key operating metrics. The Pasadena, Texas site continued to ramp production and deliver expected supply-chain savings under Project Catalyst. Pasadena utilization was in the 75%-80% range, and management said tolling savings in 2026 were exceeding expectations.
- Strategic Growth OpportunitiesManagement highlighted strong double-digit growth in North American Polymers, including spray foam and phthalic anhydride, as well as continued share growth in Latin America. The company also cited opportunities in crop productivity, including tank-mix adjuvants markets estimated at $1 billion in the United States and $700 million in Brazil.
- Positive Full-Year OutlookBased on results through the first nine months, management expects to deliver full-year adjusted EBITDA growth, positive free cash flow, and continued balance-sheet deleveraging in 2026.
SCL Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Feb 18, 2027 | 2026 (Q4) | 0.34- | -0.02 | ― | ― |
| Oct 28, 2026 | 2026 (Q3) | 0.720.94 | 0.48 | 95.83% (+0.46) | |
| Jul 29, 2026 | 2026 (Q2) | 0.611.18 | 0.52 | 126.92% (+0.66) | |
| Apr 28, 2026 | 2026 (Q1) | 0.390.45 | 0.84 | -46.43% (-0.39) | |
| Feb 23, 2026 | 2025 (Q4) | 0.40-0.02 | 0.12 | -116.67% (-0.14) | |
| Oct 29, 2025 | 2025 (Q3) | 0.610.48 | 1.03 | -53.40% (-0.55) | |
| Jul 30, 2025 | 2025 (Q2) | 0.900.52 | 0.41 | 26.83% (+0.11) | |
| Apr 29, 2025 | 2025 (Q1) | 0.600.84 | 0.64 | 31.25% (+0.20) | |
| Feb 19, 2025 | 2024 (Q4) | 0.330.12 | 0.33 | -63.64% (-0.21) | |
| Oct 30, 2024 | 2024 (Q3) | 0.651.03 | 0.64 | 60.94% (+0.39) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
