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Mar 31, 2022
Stepan Q1 2022 Earnings Report
Stepan's first quarter results were reported, with record net income achieved.
Key Takeaways
Stepan Company reported a solid start to the year with a 26% increase in net sales and a 10% increase in net income compared to the prior year. The company faced challenges including a power outage at the Millsdale, IL plant and ongoing global supply chain issues, but saw growth in surfactant operating income and polymer sales volume.
Reported net income was a record $44.8 million, up from $40.6 million in the prior year.
Surfactant operating income increased to $53.8 million, driven by improved product and customer mix.
Polymer operating income decreased due to a power outage at the Millsdale, IL plant, though sales volume increased.
Specialty Product operating income increased, primarily due to order timing differences and margin recovery.
Revenue by Segment
Forward Guidance
The company anticipates strong demand across its business but expects continued challenges from external supply chain issues. Surfactant volumes in functional product end-markets are expected to improve, the Polymer business is expected to deliver growth, and Specialty Product business results are anticipated to improve slightly year-over-year.
Positive Outlook
- Demand across the business is expected to remain strong.
- Surfactant volumes within the functional product end-markets are expected to improve.
- Favorable commodity pricing environment will drive surfactant volume growth.
- Polymer business is expected to deliver growth versus the prior year.
- Long-term prospects for rigid polyols remain attractive.
Challenges Ahead
- Company will continue to be challenged by external supply chain issues.
- Raw material availability and transportation constraints will impact the company.
- The company is facing an inflationary environment.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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