Stepan Reports Third Quarter Results and Record Nine Month Earnings
Stepan Company (NYSE: SCL) reported a net income of $36.9 million for Q3 2021, or $1.59 per diluted share, up from $33.2 million, or $1.43 per share, a year earlier. Adjusted net income remained flat at $36.4 million. Total sales rose 30% to $602.7 million compared to Q3 2020, driven by higher selling prices. Surfactant operating income fell 16% to $34.5 million due to supply chain disruptions and lower demand for consumer products. Despite challenges, the company increased its quarterly dividend by 10.9%, marking 54 consecutive years of dividend growth.
- Net income up 11% year-over-year to $36.9 million.
- Total sales increased 30% to $602.7 million.
- Q3 adjusted EPS slightly up to $1.57.
- Increased quarterly cash dividend by 10.9%, marking 54 consecutive years of increases.
- Surfactant operating income decreased 16% due to supply chain disruptions.
- Global Surfactant sales volume down 6% from last year.
- Polymer operating income fell 12%, partially due to previous non-recurring revenue.
NORTHBROOK, Ill., Oct. 20, 2021 /PRNewswire/ -- Stepan Company (NYSE: SCL) today reported:
Third Quarter Highlights
- Reported net income was
$36.9 million , or$1.59 per diluted share versus$33.2 million , or$1.43 per diluted share, in the prior year. Adjusted net income* was$36.4 million , or$1.57 per diluted share, versus$36.4 million , or$1.56 per diluted share, in the prior year. Total Company sales volume increased1% versus the prior year. - Surfactant operating income was
$34.5 million versus$41.2 million in the prior year. This decrease was primarily due to supply chain disruptions, lower sales volume and the non-recurrence of a$2.2 million insurance recovery, related to the 2020 Millsdale, IL plant power outage, recognized in the third quarter of 2020. Global Surfactant sales volume decreased6% and primarily reflects lower demand for cleaning products in the consumer products business versus the pandemic peak in 2020. Higher demand for products sold into our institutional cleaning and functional product end markets partially offset the above. - Polymer operating income was
$19.8 million versus$22.4 million in the prior year. Global Polymer sales volume increased27% . Global rigid polyol volume was up32% versus the prior year largely due to the INVISTA polyester polyol acquisition. The operating income decrease primarily reflects supply chain disruptions and the non-recurrence of two third quarter 2020 events: (i) a$2.8 million insurance recovery related to the 2020 Millsdale, IL plant power outage and; (ii) a$1.2 million partial settlement received from the China government as compensation for the government-mandated China JV shutdown in 2012. - The Company estimates that the supply chain disruptions negatively impacted Surfactants and Polymers by
$4.0 million and$3.0 million , respectively. Both segments have implemented additional price increases in October to offset inflationary pressures. - Specialty Product operating income was
$2.4 million versus$1.6 million in the prior year. This increase was primarily attributable to order timing differences within our food and flavor business and improved volume and margins within our medium chain triglycerides (MCT) product line. - The effect of foreign currency translation positively impacted net sales by
1% and net income by$0.4 million , or$0.02 per diluted share, versus the prior year. - The Company increased its quarterly cash dividend in the fourth quarter of 2021 by
$0.03 per share, or10.9% , marking the 54th consecutive year that the Company has increased its cash dividend to stockholders.
YTD Highlights
- Reported net income for the first nine months of 2021 was a record
$120.8 million , or$5.19 per diluted share, versus$96.4 million , or$4.15 per diluted share, in the prior year. Adjusted net income* was a record$121.0 million , or$5.20 per diluted share, versus$98.9 million , or$4.25 per diluted share, in the prior year. The prior year nine-month results were negatively impacted by the first quarter 2020 Millsdale, IL plant power outage. Total Company sales volume was up4% compared to the first nine months of 2020. A34% increase in global Polymer sales volume was partially offset by a4% decrease in global Surfactant sales volume.
* | Adjusted net income is a non-GAAP measure which excludes deferred compensation income/expense, cash-settled stock appreciation rights (SARs) income/expense, as well as other significant and infrequent/non-recurring items. See Table II for reconciliations of non-GAAP adjusted net income and earnings per diluted share. |
"The Company had a solid first nine months of 2021 and delivered record year-to-date results. Both reported net income and EPS were up
Financial Summary
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||||||||||
($ in thousands, except per share data) | 2021 | 2020 | % Change | 2021 | 2020 | % Change | |||||||||||||||||
Net Sales | $ | 602,688 | $ | 464,480 | 30 | % | $ | 1,735,939 | $ | 1,375,016 | 26 | % | |||||||||||
Operating Income | $ | 40,213 | $ | 42,395 | (5) | % | $ | 150,784 | $ | 127,022 | 19 | % | |||||||||||
Net Income Attributable to Stepan | $ | 36,920 | $ | 33,168 | 11 | % | $ | 120,809 | $ | 96,420 | 25 | % | |||||||||||
Earnings per Diluted Share | $ | 1.59 | $ | 1.43 | 11 | % | $ | 5.19 | $ | 4.15 | 25 | % | |||||||||||
Adjusted Net Income * | $ | 36,417 | $ | 36,421 | (0) | % | $ | 121,005 | $ | 98,894 | 22 | % | |||||||||||
Adjusted Earnings per Diluted Share * | $ | 1.57 | $ | 1.56 | 1 | % | $ | 5.20 | $ | 4.25 | 22 | % | |||||||||||
Summary of Third Quarter Adjusted Net Income Items
Adjusted net income excludes non-operational deferred compensation income/expense, cash-settled SARs income/expense and other significant and infrequent or non-recurring items.
- Deferred Compensation: The current year third quarter reported net income includes
$1.1 million of after-tax income versus$2.6 million of after-tax expense in the prior year. - Cash-Settled SARs: These management incentive instruments provide cash to participants equal to the appreciation on the price of specified shares of Company stock over a specified period of time. Because income or expense is recognized merely on the movement in the price of Company stock it has been excluded, similar to deferred compensation, to arrive at adjusted net income. The current year third quarter includes
$0.1 million of after-tax income versus$0.5 million of after-tax expense in the prior year. - Environmental Remediation: The current year third quarter reported net income includes
$0.7 million of after-tax expense versus no expense recognition in the prior year. The majority of the current year expense reflects EPA environmental remediation oversight costs associated with the Company's Maywood, New Jersey site. - Business Restructuring: The current year third quarter includes
$0.1 million of after-tax decommissioning expense related to the Company's Canadian plant closure versus$0.1 million of after-tax expense in the prior year.
Percentage Change in Net Sales
Net sales in the third quarter of 2021 increased
Three Months Ended September 30, 2021 | Nine Months Ended September 30, 2021 | |||||||
Volume | 1 | % | 4 | % | ||||
Selling Price & Mix | 28 | % | 20 | % | ||||
Foreign Translation | 1 | % | 2 | % | ||||
Total | 30 | % | 26 | % | ||||
Reported Segment Results
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||||||||||
($ in thousands) | 2021 | 2020 | % Change | 2021 | 2020 | % Change | ||||||||||||||||||
Net Sales | ||||||||||||||||||||||||
Surfactants | $ | 387,734 | $ | 333,839 | 16 | % | $ | 1,142,672 | $ | 993,245 | 15 | % | ||||||||||||
Polymers | $ | 198,841 | $ | 116,682 | 70 | % | $ | 539,764 | $ | 335,582 | 61 | % | ||||||||||||
Specialty Products | $ | 16,113 | $ | 13,959 | 15 | % | $ | 53,503 | $ | 46,189 | 16 | % | ||||||||||||
Total Net Sales | $ | 602,688 | $ | 464,480 | 30 | % | $ | 1,735,939 | $ | 1,375,016 | 26 | % | ||||||||||||
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||||||||||
($ in thousands, all amounts pre-tax) | 2021 | 2020 | % Change | 2021 | 2020 | % Change | ||||||||||||||||||
Operating Income | ||||||||||||||||||||||||
Surfactants | $ | 34,452 | $ | 41,151 | (16) | % | $ | 133,558 | $ | 125,810 | 6 | % | ||||||||||||
Polymers | $ | 19,753 | $ | 22,387 | (12) | % | $ | 60,729 | $ | 45,430 | 34 | % | ||||||||||||
Specialty Products | $ | 2,442 | $ | 1,593 | 53 | % | $ | 12,052 | $ | 8,803 | 37 | % | ||||||||||||
Total Segment | $ | 56,647 | $ | 65,131 | (13) | % | $ | 206,339 | $ | 180,043 | 15 | % | ||||||||||||
Corporate Expenses | $ | (16,434) | $ | (22,736) | 28 | % | $ | (55,555) | $ | (53,021) | (5) | % | ||||||||||||
Consolidated Operating | $ | 40,213 | $ | 42,395 | (5) | % | $ | 150,784 | $ | 127,022 | 19 | % | ||||||||||||
Total segment operating income for the third quarter of 2021 decreased
- Surfactant net sales were
$387.7 million for the quarter, a16% increase versus the prior year. Selling prices were up20% primarily due to improved product and customer mix as well as the pass-through of higher raw material costs. The effect of foreign currency translation positively impacted net sales by2% . Sales volume decreased6% quarter-over-quarter. Most of this decrease reflects lower sales volume into the North American consumer product end markets due to lower demand for consumer cleaning, disinfection and personal wash products versus the pandemic peak. Higher demand for products sold into the institutional cleaning and functional product end markets partially offset the above. Surfactant operating income for the quarter decreased$6.7 million , or16% , versus the prior year quarter primarily due to inflationary pressures, supply chain disruptions and higher planned maintenance expenses. Also contributing to decline in operating income was the non-recurrence of a$2.2 million insurance recovery, related to the 2020 Millsdale, IL plant power outage, recognized in the third quarter of 2020. - Polymer net sales were
$198.8 million for the quarter, a70% increase versus the prior year. Selling prices increased44% primarily due to the pass through of higher raw material costs. Sales volume increased27% in the quarter primarily due to33% growth in rigid polyol demand that was mostly attributable to the INVISTA acquisition. Higher demand within the specialty polyols business also contributed to the sales volume growth. The translation impact of a stronger U.S. dollar negatively impacted net sales by1% . Polymer operating income decreased$2.6 million , or12% , primarily due to supply chain disruptions and the non-recurrence of two third quarter 2020 events: (i) a$2.8 million insurance recovery related to the 2020 Millsdale, IL plant power outage, and (ii) a$1.2 million partial settlement received from the China government as compensation for the government-mandated China JV shutdown in 2012. - Specialty Product net sales were
$16.1 million for the quarter, a15% increase versus the prior year. Sales volume was up9% between quarters and operating income increased$0.8 million , or53% . The operating income increase was primarily attributable to order timing differences with our food and flavor business and improved volume and margins within our medium chain triglycerides (MCT) product line.
Corporate Expenses
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||||||||||
($ in thousands) | 2021 | 2020 | % Change | 2021 | 2020 | % Change | ||||||||||||||||||
Total Corporate Expenses | $ | 16,434 | $ | 22,736 | (28) | % | $ | 55,555 | $ | 53,021 | 5 | % | ||||||||||||
Less: | ||||||||||||||||||||||||
Deferred Compensation | $ | (1,504) | $ | 5,613 | NM | $ | 2,148 | $ | 4,754 | (55) | % | |||||||||||||
Business Restructuring | $ | 72 | $ | 126 | (43) | % | $ | 267 | $ | 708 | (62) | % | ||||||||||||
Adjusted Corporate Expenses | $ | 17,866 | $ | 16,997 | 5 | % | $ | 53,140 | $ | 47,559 | 12 | % | ||||||||||||
* See Table III for a discussion of deferred compensation plan accounting. |
- Corporate expenses, excluding deferred compensation and business restructuring expenses, increased
$0.9 million , or5% for the quarter. The quarterly increase was primarily due to a$0.9 million pre-tax adjustment to the Company's environmental remediation reserves and higher insurance premiums, partially offset by lower incentive-based compensation expense.
Income Taxes and Net Interest
The Company's effective tax rate was
Shareholder Return
The Company paid
Selected Balance Sheet Information
The Company's total debt increased by
($ in millions) | 9/30/21 | 6/30/21 | 3/31/21 | 12/31/20 | ||||||||||||
Net Debt | ||||||||||||||||
Total Debt | $ | 279.8 | $ | 238.9 | $ | 248.4 | $ | 198.7 | ||||||||
Cash | 105.3 | 127.1 | 150.7 | 349.9 | ||||||||||||
Net Debt | $ | 174.5 | $ | 111.8 | $ | 97.7 | $ | (151.2) | ||||||||
Equity | 1,057.3 | 1,048.8 | 1,002.3 | 986.7 | ||||||||||||
Net Debt + Equity | $ | 1,231.8 | $ | 1,160.6 | $ | 1,100.0 | $ | 835.5 | ||||||||
Net Debt / (Net Debt + Equity) | 14 | % | 10 | % | 9 | % | -18 | % | ||||||||
The major working capital components were:
($ in millions) | 9/30/21 | 6/30/21 | 3/31/21 | 12/31/20 | ||||||||||||
Net Receivables | $ | 413.6 | $ | 391.7 | $ | 380.6 | $ | 301.3 | ||||||||
Inventories | 290.9 | 266.1 | 235.1 | 218.8 | ||||||||||||
Accounts Payable | (314.5) | (286.9) | (264.2) | (236.8) | ||||||||||||
$ | 390.0 | $ | 370.9 | $ | 351.5 | $ | 283.3 | |||||||||
Capital spending was
Outlook
"The Company delivered record nine-month earnings in 2021," said F. Quinn Stepan, Jr., Chairman and Chief Executive Officer. "Looking forward, we believe our Surfactant volumes in the North American consumer product end markets will continue to be challenged by raw material and transportation availability. While we believe industrial and institutional cleaning volume will grow versus prior year, we do not believe it will compensate for lower consumer consumption of cleaning, disinfection and personal wash products. We believe that demand for surfactants within the agricultural and oilfield markets will exceed prior year demand. We believe our Polymer business will deliver growth versus prior year due to the ongoing recovery from pandemic-related delays and cancellations of re-roofing and new construction projects and our first quarter 2021 acquisition of INVISTA's aromatic polyester polyol business. We continue to believe the long-term prospects for rigid polyols remain attractive as energy conservation efforts and more stringent building codes are expected to continue. We anticipate our Specialty Product business results will improve slightly year-over-year. Despite supply chain disruptions continuing to impact the Company, we remain optimistic about delivering full year earnings growth."
Conference Call
Stepan Company will host a conference call to discuss the third quarter results at 10:00 a.m. ET (9:00 a.m. CT) on October 20, 2021. The call can be accessed by phone and webcast. Telephone access will be available by dialing +1 (877) 226-0954, and the webcast can be accessed through the Investors/Conference Calls page at www.stepan.com. A webcast replay of the conference call will be available at the same location shortly after the call.
Supporting Slides
Slides supporting this press release will be made available at www.stepan.com through the Investors/Presentations page at approximately the same time as this press release is issued.
Corporate Profile
Stepan Company is a major manufacturer of specialty and intermediate chemicals used in a broad range of industries. Stepan is a leading merchant producer of surfactants, which are the key ingredients in consumer and industrial cleaning and disinfection compounds and in agricultural and oilfield solutions. The Company is also a leading supplier of polyurethane polyols used in the expanding thermal insulation market, and CASE (Coatings, Adhesives, Sealants, and Elastomers) industries.
Headquartered in Northbrook, Illinois, Stepan utilizes a network of modern production facilities located in North and South America, Europe and Asia.
The Company's common stock is traded on the New York Stock Exchange (NYSE) under the symbol SCL. For more information about Stepan Company please visit the Company online at www.stepan.com
More information about Stepan's sustainability program can be found on the Sustainability page at www.stepan.com
Contact: Luis E. Rojo 847-446-7500
Certain information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include statements about Stepan Company's plans, objectives, strategies, financial performance and outlook, trends, the amount and timing of future cash distributions, prospects or future events and involve known and unknown risks that are difficult to predict. As a result, Stepan Company's actual financial results, performance, achievements or prospects may differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by the use of words such as "may," "could," "expect," "intend," "plan," "seek," "anticipate," "believe," "estimate," "guidance," "predict," "potential," "continue," "likely," "will," "would," "should," "illustrative" and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by Stepan Company and its management based on their knowledge and understanding of the business and industry, are inherently uncertain. These statements are not guarantees of future performance, and stockholders should not place undue reliance on forward-looking statements.
There are a number of risks, uncertainties and other important factors, many of which are beyond Stepan Company's control, that could cause actual results to differ materially from the forward-looking statements contained in this news release. Such risks, uncertainties and other important factors include, among other factors, the risks, uncertainties and factors described in Stepan Company's Form 10-K, Form 10-Q and Form 8-K reports and exhibits to those reports, and include (but are not limited to) risks and uncertainties related to the impact of the COVID-19 pandemic; accidents, unplanned production shutdowns or disruptions in manufacturing facilities; reduced demand due to customer product reformulations or new technologies; our inability to successfully develop or introduce new products; compliance with laws; our ability to identify suitable acquisition candidates and successfully complete and integrate acquisitions; global competition; volatility of raw material and energy costs and supply; disruptions in transportation or significant changes in transportation costs; downturns in certain industries and general economic downturns; international business risks, including currency exchange rate fluctuations, legal restrictions and taxes; unfavorable resolution of litigation against us; maintaining and protecting intellectual property rights; our ability to access capital markets; global political, military, security or other instability; costs related to expansion or other capital projects; interruption or breaches of information technology systems; our ability to retain executive management and key personnel; and our debt covenants.
These forward-looking statements are made only as of the date hereof, and Stepan Company undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.
Table I | ||||||||||||||||
STEPAN COMPANY For the Three and Nine Months Ended September 30, 2021 and 2020 (Unaudited – 000's Omitted) | ||||||||||||||||
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net Sales | $ | 602,688 | $ | 464,480 | $ | 1,735,939 | $ | 1,375,016 | ||||||||
Cost of Sales | 510,792 | 367,423 | 1,423,382 | 1,100,195 | ||||||||||||
Gross Profit | 91,896 | 97,057 | 312,557 | 274,821 | ||||||||||||
Operating Expenses: | ||||||||||||||||
Selling | 14,786 | 13,266 | 44,280 | 39,719 | ||||||||||||
Administrative | 22,828 | 21,354 | 69,440 | 60,957 | ||||||||||||
Research, Development and Technical Services | 15,501 | 14,303 | 45,638 | 41,661 | ||||||||||||
Deferred Compensation Expense (Income) | (1,504) | 5,613 | 2,148 | 4,754 | ||||||||||||
51,611 | 54,536 | 161,506 | 147,091 | |||||||||||||
Business Restructuring | 72 | 126 | 267 | 708 | ||||||||||||
Operating Income | 40,213 | 42,395 | 150,784 | 127,022 | ||||||||||||
Other Income (Expense): | ||||||||||||||||
Interest, Net | (1,599) | (1,626) | (4,690) | (4,115) | ||||||||||||
Other, Net | 702 | 2,629 | 4,206 | 3,804 | ||||||||||||
(897) | 1,003 | (484) | (311) | |||||||||||||
Income Before Income Taxes | 39,316 | 43,398 | 150,300 | 126,711 | ||||||||||||
Provision for Income Taxes | 2,393 | 10,056 | 29,463 | 29,987 | ||||||||||||
Net Income | 36,923 | 33,342 | 120,837 | 96,724 | ||||||||||||
Net Income Attributable to Noncontrolling | (3) | (174) | (28) | (304) | ||||||||||||
Net Income Attributable to Stepan Company | $ | 36,920 | $ | 33,168 | $ | 120,809 | $ | 96,420 | ||||||||
Net Income Per Common Share Attributable to | ||||||||||||||||
Basic | $ | 1.61 | $ | 1.45 | $ | 5.27 | $ | 4.20 | ||||||||
Diluted | $ | 1.59 | $ | 1.43 | $ | 5.19 | $ | 4.15 | ||||||||
Shares Used to Compute Net Income Per Common Share Attributable to Stepan Company | ||||||||||||||||
Basic | 22,898 | 22,907 | 22,941 | 22,951 | ||||||||||||
Diluted | 23,219 | 23,237 | 23,299 | 23,236 | ||||||||||||
Table II | ||||||||||||||||||||||||||||||||
Reconciliation of Non-GAAP Net Income and Earnings per Diluted Share * | ||||||||||||||||||||||||||||||||
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||||||||||||||||||
($ in thousands, except per | 2021 | EPS | 2020 | EPS | 2021 | EPS | 2020 | EPS | ||||||||||||||||||||||||
Net Income Reported | $ | 36,920 | $ | 1.59 | $ | 33,168 | $ | 1.43 | $ | 120,809 | $ | 5.19 | $ | 96,420 | $ | 4.15 | ||||||||||||||||
Deferred Compensation | $ | (1,135) | $ | (0.05) | $ | 2,612 | $ | 0.11 | $ | (685) | $ | (0.03) | $ | 1,692 | $ | 0.07 | ||||||||||||||||
Business Restructuring | $ | 54 | $ | - | $ | 95 | $ | 0.00 | $ | 200 | $ | 0.01 | $ | 526 | $ | 0.02 | ||||||||||||||||
Cash-Settled SARs | $ | (141) | $ | - | $ | 546 | $ | 0.02 | $ | (38) | $ | (0.00) | $ | 256 | $ | 0.01 | ||||||||||||||||
Environmental | $ | 719 | $ | 0.03 | $ | - | $ | - | $ | 719 | $ | 0.03 | $ | - | ||||||||||||||||||
Adjusted Net Income | $ | 36,417 | $ | 1.57 | $ | 36,421 | $ | 1.56 | $ | 121,005 | $ | 5.20 | $ | 98,894 | $ | 4.25 | ||||||||||||||||
* All amounts in this table are presented after-tax
The Company believes that certain measures that are not in accordance with generally accepted accounting principles (GAAP), when presented in conjunction with comparable GAAP measures, are useful for evaluating the Company's operating performance and provide better clarity on the impact of non-operational items. Internally, the Company uses this non-GAAP information as an indicator of business performance and evaluates management's effectiveness with specific reference to these indicators. These measures should be considered in addition to, neither a substitute for, nor superior to, measures of financial performance prepared in accordance with GAAP.
Reconciliation of Pre-Tax to After-Tax Adjustments | ||||||||||||||||||||||||||||||||
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||||||||||||||||||
($ in thousands, except per | 2021 | EPS | 2020 | EPS | 2021 | EPS | 2020 | EPS | ||||||||||||||||||||||||
Pre-Tax Adjustments | ||||||||||||||||||||||||||||||||
Deferred Compensation | $ | (1,494) | $ | 3,437 | $ | (901) | $ | 2,227 | ||||||||||||||||||||||||
Business Restructuring | $ | 72 | $ | 126 | $ | 267 | $ | 708 | ||||||||||||||||||||||||
Cash-Settled SARs | $ | (186) | $ | 718 | $ | (50) | $ | 337 | ||||||||||||||||||||||||
Environmental | $ | 946 | $ | - | $ | 946 | $ | - | ||||||||||||||||||||||||
Total Pre-Tax | $ | (662) | $ | 4,281 | $ | 262 | $ | 3,272 | ||||||||||||||||||||||||
Cumulative Tax Effect | $ | 159 | $ | (1,028) | $ | (66) | $ | (798) | ||||||||||||||||||||||||
After-Tax Adjustments | $ | (503) | $ | (0.02) | $ | 3,253 | $ | 0.13 | $ | 196 | $ | 0.01 | $ | 2,474 | $ | 0.10 | ||||||||||||||||
Table III | ||||||||||||||||||||||||||||||
Deferred Compensation Plan | ||||||||||||||||||||||||||||||
The full effect of the deferred compensation plan on quarterly pre-tax income was | ||||||||||||||||||||||||||||||
2021 | 2020 | |||||||||||||||||||||||||||||
12/31 | 9/30 | 6/30 | 3/31 | 12/31 | 9/30 | 6/30 | 3/31 | |||||||||||||||||||||||
Stepan Company | N/A | $ | 112.94 | $ | 120.27 | $ | 127.11 | $ | 119.32 | $ | 109.00 | $ | 97.10 | $ | 88.46 | |||||||||||||||
The deferred compensation income statement impact is summarized below: | ||||||||||||||||
Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||
($ in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
Deferred Compensation | ||||||||||||||||
Operating Income (Expense) | $ | 1,504 | $ | (5,613) | $ | (2,148) | $ | (4,754) | ||||||||
Other, net – Mutual Fund Gain (Loss) | (10) | 2,176 | 3,049 | 2,527 | ||||||||||||
Total Pre-Tax | $ | 1,494 | $ | (3,437) | $ | 901 | $ | (2,227) | ||||||||
Total After-Tax | $ | 1,135 | $ | (2,612) | $ | 685 | $ | (1,692) | ||||||||
Table IV | ||||||||||||||||||||||||||||||||
Effects of Foreign Currency Translation | ||||||||||||||||||||||||||||||||
The Company's foreign subsidiaries transact business and report financial results in their respective local currencies. As a result, foreign subsidiary income statements are translated into U.S. dollars at average foreign exchange rates appropriate for the reporting period. Because foreign currency exchange rates fluctuate against the U.S. dollar over time, foreign currency translation affects period-to-period comparisons of financial statement items (i.e., because foreign exchange rates fluctuate, similar period-to-period local currency results for a foreign subsidiary may translate into different U.S. dollar results). Below is a table that presents the impact that foreign currency translation had on the changes in consolidated net sales and various income line items for the three and nine month periods ending September 30, 2021 as compared to 2020: | ||||||||||||||||||||||||||||||||
($ in millions) | Three Months Ended September 30 | Increase (Decrease) | Increase Due to Foreign Currency Translation | Nine Months Ended September 30 | Increase | Increase Due to Foreign Currency Translation | ||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||||||||
Net Sales | $ | 602.7 | $ | 464.5 | $ | 138.2 | $ | 5.9 | $ | 1,735.9 | $ | 1,375.0 | $ | 360.9 | $ | 30.5 | ||||||||||||||||
Gross Profit | 91.9 | 97.1 | (5.2) | 0.8 | 312.6 | 274.8 | 37.8 | 3.7 | ||||||||||||||||||||||||
Operating Income | 40.2 | 42.4 | (2.2) | 0.5 | 150.8 | 127.0 | 23.8 | 2.2 | ||||||||||||||||||||||||
Pretax Income | 39.3 | 43.4 | (4.1) | 0.4 | 150.3 | 126.7 | 23.6 | 2.4 | ||||||||||||||||||||||||
Table V | ||||||||
Stepan Company Consolidated Balance Sheets September 30, 2021 and December 31, 2020 | ||||||||
Sept. 30, 2021 | December 31, 2020 | |||||||
ASSETS | ||||||||
Current Assets | $ | 839,213 | $ | 905,651 | ||||
Property, Plant & Equipment, Net | 799,396 | 682,667 | ||||||
Other Assets | 317,330 | 164,018 | ||||||
Total Assets | $ | 1,955,939 | $ | 1,752,336 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current Liabilities | $ | 491,065 | $ | 416,554 | ||||
Deferred Income Taxes | 8,637 | 20,745 | ||||||
Long-term Debt | 232,184 | 160,812 | ||||||
Other Non-current Liabilities | 165,036 | 165,860 | ||||||
Total Stepan Company Stockholders' Equity | 1,057,296 | 986,693 | ||||||
Noncontrolling Interest | 1,721 | 1,672 | ||||||
Total Liabilities and Stockholders' Equity | $ | 1,955,939 | $ | 1,752,336 | ||||
View original content:https://www.prnewswire.com/news-releases/stepan-reports-third-quarter-results-and-record-nine-month-earnings-301404200.html
SOURCE Stepan Company
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