NORTHBROOK, Ill., April 26,
2022 /PRNewswire/ -- Stepan Company (NYSE: SCL) today
reported:
First Quarter Highlights
- Reported net income was a record $44.8
million, or $1.93 per diluted
share versus $40.6 million, or
$1.74 per diluted share, in the prior
year. Adjusted net income* was $40.7
million, or $1.76 per diluted
share versus $42.4 million, or
$1.82 per diluted share, in the prior
year. Total Company sales volume was flat versus the prior
year.
- Surfactant operating income was a record $53.8 million versus $53.2
million in the prior year. This increase was primarily
driven by improved product and customer mix that was mostly offset
by ongoing global supply chain challenges and a 1% decline in
global sales volume. The lower sales volume was primarily due
to lower demand for laundry products within the consumer products
business. Higher demand in the functional products, personal
care and institutional cleaning end markets mostly offset the
above. Volume sold within the Tier 2 and Tier 3 customer
channel continues to perform well.
- Polymer operating income was $14.1
million versus $18.0 million
in the prior year. This decrease was due to a January 2022 power outage at the Company's
Millsdale, IL plant site that negatively impacted production.
The production disruption resulted in the declaration of force
majeure for select products and higher sourcing, logistic and
maintenance costs. The Company estimates these items negatively
impacted Polymer's first quarter 2022 earnings by approximately
$5.0 million pre-tax. The force
majeure was lifted on April
15th. Global Polymer sales volume increased
2% versus the prior year. Global rigid polyol volume was up
5% versus the prior year largely due to the 2021 INVISTA polyester
polyol acquisition which closed at the end of January 2021.
- Specialty Product operating income was $3.7 million versus $2.6
million in the prior year. This increase was primarily
attributable to order timing differences within the food and flavor
business and margin recovery within the medium chain triglycerides
(MCTs) product line, partially offset by a decline in MCTs sales
volume.
*
|
Adjusted net income
is a non-GAAP measure which excludes deferred compensation
income/expense, cash-settled stock appreciation rights (SARs)
income/expense, legacy environmental remediation-related costs as
well as other significant and infrequent/non-recurring items. See
Table II for reconciliations of non-GAAP adjusted net income and
adjusted earnings per share.
|
|
|
"The Company had a solid start to the year despite the power
outage at the Company's Millsdale, IL plant site and ongoing global
supply chain challenges. Reported net income was up 10%
versus the prior year first quarter while adjusted net income
declined 4%" said Scott Behrens,
President and Chief Executive Officer. "Surfactant operating
income was up 1% largely due to improved product and customer mix,
driven by growth in our functional products business as a result of
higher commodity prices and continued growth in the construction
industry, that offset a 1% decline in sales volume and ongoing
supply chain challenges. Our Polymer operating income was
down 21% primarily due to the Millsdale power outage and related
production disruptions. Global Polymer sales volume was up 2%
year-over-year. Our Specialty Product business results were
up primarily due to order timing differences."
Financial Summary
|
|
Three Months Ended
March 31
|
|
($ in thousands, except per share
data)
|
|
2022
|
|
|
2021
|
|
|
%
Change
|
|
Net Sales
|
|
$
|
675,276
|
|
|
$
|
537,740
|
|
|
|
26
|
%
|
Operating
Income
|
|
$
|
63,346
|
|
|
$
|
53,914
|
|
|
|
17
|
%
|
Net Income
Attributable to Stepan
|
|
$
|
44,809
|
|
|
$
|
40,611
|
|
|
|
10
|
%
|
Earnings per Diluted
Share
|
|
$
|
1.93
|
|
|
$
|
1.74
|
|
|
|
11
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income
*
|
|
$
|
40,728
|
|
|
$
|
42,372
|
|
|
|
(4)
|
%
|
Adjusted Earnings per
Diluted Share *
|
|
$
|
1.76
|
|
|
$
|
1.82
|
|
|
|
(3)
|
%
|
* See Table II for
reconciliations of non-GAAP adjusted net income and earnings per
diluted share.
* * Net Income
Attributable to Stepan = Net Income - Net Loss Attributable to
Noncontrolling Interests.
|
|
Summary of First Quarter Adjusted Net Income Items
Adjusted net income excludes non-operational deferred
compensation income/expense, cash-settled SARs income/expense,
legacy environmental remediation-related costs and other
significant and infrequent or non-recurring items.
- Deferred Compensation: The current year first
quarter reported net income includes $3.9
million of after-tax income versus $1.5 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 quarter includes $0.4 million of after-tax income versus
$0.2 million of after-tax expense in
the prior year.
- Business Restructuring: The current year quarter
includes $0.04 million of after-tax
decommissioning expense related to the Company's Canadian plant
closure versus $0.06 million of
after-tax expense in the prior year.
- Environmental Remediation – The first quarter of 2022
adjusted net income excludes $0.2
million of after-tax expense versus no environmental
remediation expense excluded from adjusted net income in the prior
year.
Percentage Change in Net Sales
Net sales in the first quarter increased 26% year-over-year
primarily due to higher selling prices that were mainly
attributable to the pass-through of higher raw material costs and
improved product and customer mix. These higher average
selling prices were slightly offset by the unfavorable impact of
foreign currency translation. Consolidated sales volume was
flat year-over-year.
|
|
Three Months Ended
March 31, 2022
|
|
Volume
|
|
|
—
|
|
Selling Price &
Mix
|
|
|
28
|
%
|
Foreign Currency
Translation
|
|
|
(2)
|
%
|
Total
|
|
|
26
|
%
|
Segment Results
|
|
Three Months Ended
March 31
|
|
($ in thousands)
|
|
2022
|
|
|
2021
|
|
|
%
Change
|
|
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
Surfactants
|
|
$
|
468,266
|
|
|
$
|
370,936
|
|
|
|
26
|
%
|
Polymers
|
|
$
|
187,079
|
|
|
$
|
150,385
|
|
|
|
24
|
%
|
Specialty Products
|
|
$
|
19,931
|
|
|
$
|
16,419
|
|
|
|
21
|
%
|
Total Net Sales
|
|
$
|
675,276
|
|
|
$
|
537,740
|
|
|
|
26
|
%
|
|
|
|
|
Three Months Ended
March 31
|
|
($ in thousands, all amounts
pre-tax)
|
|
2022
|
|
|
2021
|
|
|
%
Change
|
|
Operating Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Surfactants
|
|
$
|
53,769
|
|
|
$
|
53,210
|
|
|
|
1
|
%
|
Polymers
|
|
$
|
14,129
|
|
|
$
|
17,951
|
|
|
|
(21)
|
%
|
Specialty Products
|
|
$
|
3,695
|
|
|
$
|
2,633
|
|
|
|
40
|
%
|
Segment Operating Income
|
|
$
|
71,593
|
|
|
$
|
73,794
|
|
|
|
(3)
|
%
|
Corporate Expenses
|
|
$
|
(8,247)
|
|
|
$
|
(19,880)
|
|
|
|
(59)
|
%
|
Consolidated Operating Income
|
|
$
|
63,346
|
|
|
$
|
53,914
|
|
|
|
17
|
%
|
Total segment operating income for the first quarter of 2022
decreased $2.2 million, or 3%, versus
the prior year quarter.
- Surfactant net sales were $468.3
million for the quarter, a 26% increase versus the prior
year. Selling prices were up 29% primarily due to the
pass-through of higher raw material costs as well as improved
product and customer mix. The unfavorable impact of foreign
currency translation negatively impacted net sales by 2%.
Sales volume decreased 1% year-over-year primarily due to lower
demand for laundry products in the consumer products
business. Higher global demand for products sold into the
functional product, personal care and institutional cleaning end
markets, largely offset the above. Surfactant operating
income for the quarter increased $0.6
million, or 1%, versus the prior year primarily due to
improved product and customer mix that was mostly offset by supply
chain challenges and a 1% decline in sales volume.
- Polymer net sales were $187.1
million in the quarter, a 24% increase versus the prior
year. Selling prices increased 26% primarily due to the pass
through of higher raw material costs. Sales volume increased
2% in the quarter primarily due to rigid polyol growth of 5% that
was partially offset by an 8% decline in phthalic anhydride sales
volume. Both North American rigid polyol and phthalic
anhydride sales volumes were negatively impacted by the first
quarter 2022 Millsdale power outage. The translation impact
of a stronger U.S. dollar negatively impacted net sales by
4%. Polymer operating income decreased $3.8 million, or 21%, primarily due to the
Millsdale power outage that negatively impacted the quarter by an
estimated $5.0 million pre-tax.
- Specialty Product net sales were $19.9
million for the quarter, a 21% increase versus the prior
year. Sales volume was down 12% between years while operating
income improved $1.1 million, or
40%. The operating income improvement was primarily
attributable to order timing differences within the food and flavor
business and improved margins within the MCTs product line.
Corporate Expenses
|
|
Three Months Ended
March 31
|
|
($ in thousands)
|
|
2022
|
|
|
2021
|
|
|
%
Change
|
|
Total - Corporate
Expenses
|
|
$
|
8,247
|
|
|
$
|
19,880
|
|
|
|
(59)
|
%
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred
Compensation Expense/(Income)
|
|
$
|
(7,501)
|
|
|
$
|
2,694
|
|
|
NM
|
|
Business
Restructuring Expense
|
|
$
|
52
|
|
|
$
|
81
|
|
|
|
(36)
|
%
|
Adjusted Corporate Expenses
|
|
$
|
15,696
|
|
|
$
|
17,105
|
|
|
|
(8)
|
%
|
* See Table III for a discussion of deferred
compensation plan accounting.
|
- Corporate expenses, excluding deferred compensation and
business restructuring costs, decreased $1.4
million, or 8%, versus the prior year quarter. This
decrease was primarily due to lower acquisition-related expenses.
Income Taxes
The Company's effective tax rate was 24.6% in the first quarter
of 2022 versus 23.6% in the first quarter of 2021. This increase
was primarily attributable to less favorable tax benefits derived
from stock-based compensation awards exercised or distributed in
the first quarter of 2022 versus the first quarter of 2021 and a
less favorable geographical mix of income in the current year
quarter.
Shareholder Return
The Company paid $7.5 million of
dividends to shareholders and repurchased $9.9 million of Company stock in the first
quarter of 2022. The Company has $140.1 million remaining under the share
repurchase program authorized by its Board of Directors. The
Company has increased its dividend on the Company's common stock
for 54 consecutive years.
Selected Balance Sheet Information
The Company's total debt increased by $173.5 million and cash increased by $76.8 million versus year-end 2021. The
increase in debt reflects borrowings against the Company's $350MM
revolving credit agreement and the previously disclosed issuance of
$75.0 million of senior notes during
March 2022. The increase in cash primarily reflects the above
debt borrowings, partially offset by higher working capital
requirements and capital expenditures. The Company's net debt
level increased $96.7 million versus
year-end 2021 and the net debt ratio increased from 16% to 21% (net
debt and net debt ratios are non-GAAP measures).
($ in millions)
|
|
March 31, 2022
|
|
|
December 31, 2021
|
|
Net Debt
|
|
|
|
|
|
|
|
|
Total Debt
|
|
$
|
537.1
|
|
|
$
|
363.6
|
|
Cash
|
|
|
236.0
|
|
|
|
159.2
|
|
Net Debt
|
|
$
|
301.1
|
|
|
$
|
204.4
|
|
Equity
|
|
|
1,116.7
|
|
|
|
1,074.2
|
|
Net Debt +
Equity
|
|
$
|
1,417.8
|
|
|
$
|
1,278.6
|
|
Net Debt / (Net Debt
+ Equity)
|
|
|
21
|
%
|
|
|
16
|
%
|
The major working capital components were:
($ in millions)
|
|
March 31, 2022
|
|
|
December 31, 2021
|
|
|
|
Net
Receivables
|
|
$
|
504.5
|
|
|
$
|
419.5
|
|
|
|
Inventories
|
|
|
308.4
|
|
|
|
305.5
|
|
|
|
Accounts
Payable
|
|
|
(350.8)
|
|
|
|
(323.4)
|
|
|
|
Net
Total
|
|
$
|
462.1
|
|
|
$
|
401.6
|
|
|
|
Capital spending was $60.3 million
versus $37.6 million in the prior
year quarter. The increase was primarily due to increased
expenditures in the U.S. for the advancement of the Company's new
alkoxylation production facility in Pasadena, TX, which is expected to provide
flexible capacity of 75,000 metric tons per year, and new
capability and capacity to produce ether sulfates that will meet
future regulatory limits on 1,4 dioxane. For the full year,
capital expenditures are expected to be in the range of
$350 million to $375 million.
Outlook
"Looking forward, we believe that demand across our business
will remain strong but the Company will continue to be challenged
by external supply chain issues, including raw material
availability and transportation constraints that impacted us in
2021 and during the first quarter of 2022," said Scott Behrens, President and Chief Executive
Officer. "From a segment perspective, we believe that
Surfactant volumes within the functional product end-markets,
inclusive of agricultural and oilfield, will improve versus 2021
driven by a favorable commodity pricing environment. We
believe our Polymer business will deliver growth versus the prior
year and we continue to believe the long-term prospects for rigid
polyols remain attractive as energy conservation efforts and more
stringent building codes should increase demand. We
anticipate our Specialty Product business results will improve
slightly year-over-year. We are cautiously optimistic about
the remainder of the year despite the current inflationary
environment and ongoing supply chain challenges."
Conference Call
Stepan Company will host a conference call to discuss its first
quarter results at 8:00 a.m. ET
(7:00 a.m. CT) on April 26, 2022. The call can be accessed by phone
and webcast. Telephone access will be available by dialing +1
(800) 734-8592, 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.
* * * * *
Tables follow
Table
I
|
|
STEPAN COMPANY For the Three Months
Ended March 31, 2022 and 2021 (Unaudited – '000s
Omitted)
|
|
|
|
|
|
Three Months Ended
March 31
|
|
|
|
2022
|
|
|
2021
|
|
Net Sales
|
|
$
|
675,276
|
|
|
$
|
537,740
|
|
Cost of Sales
|
|
|
566,057
|
|
|
|
428,760
|
|
Gross
Profit
|
|
|
109,219
|
|
|
|
108,980
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
Selling
|
|
|
15,277
|
|
|
|
14,504
|
|
Administrative
|
|
|
21,572
|
|
|
|
22,638
|
|
Research, Development and Technical Services
|
|
|
16,473
|
|
|
|
15,149
|
|
Deferred Compensation (Income) Expense
|
|
|
(7,501)
|
|
|
|
2,694
|
|
|
|
|
45,821
|
|
|
|
54,985
|
|
|
|
|
|
|
|
|
|
|
Business Restructuring
|
|
|
52
|
|
|
|
81
|
|
Operating Income
|
|
|
63,346
|
|
|
|
53,914
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
Interest, Net
|
|
|
(2,306)
|
|
|
|
(1,524)
|
|
Other, Net
|
|
|
(1,650)
|
|
|
|
746
|
|
|
|
|
(3,956)
|
|
|
|
(778)
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
|
|
59,390
|
|
|
|
53,136
|
|
Provision for Income Taxes
|
|
|
14,581
|
|
|
|
12,525
|
|
Net Income
|
|
|
44,809
|
|
|
|
40,611
|
|
Net Loss Attributable to Noncontrolling
Interests
|
|
|
|
|
|
|
|
|
Net Income Attributable to Stepan
Company
|
|
$
|
44,809
|
|
|
$
|
40,611
|
|
Net Income Per Common Share Attributable to Stepan
Company
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
1.96
|
|
|
$
|
1.77
|
|
Diluted
|
|
$
|
1.93
|
|
|
$
|
1.74
|
|
Shares Used to Compute Net Income Per
Common
Share Attributable to Stepan
Company
|
|
|
|
|
|
|
|
|
Basic
|
|
|
22,896
|
|
|
|
22,974
|
|
Diluted
|
|
|
23,167
|
|
|
|
23,330
|
|
Table
II
|
|
|
|
Reconciliations of Non-GAAP Net
Income and Earnings per Diluted Share*
|
|
|
|
|
|
Three Months Ended
March 31
|
|
($ in thousands, except per share
amounts)
|
|
2022
|
|
|
EPS
|
|
|
2021
|
|
|
EPS
|
|
Net Income
Reported
|
|
$
|
44,809
|
|
|
$
|
1.93
|
|
|
$
|
40,611
|
|
|
$
|
1.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred Compensation
(Income) Expense
|
|
$
|
(3,948)
|
|
|
$
|
(0.17)
|
|
|
$
|
1,501
|
|
|
$
|
0.07
|
|
Business
Restructuring
|
|
|
39
|
|
|
$
|
0.00
|
|
|
|
61
|
|
|
$
|
0.00
|
|
Cash Settled Stock
Appreciation Rights
|
|
|
(402)
|
|
|
$
|
(0.01)
|
|
|
|
199
|
|
|
$
|
0.01
|
|
Environmental
Remediation
|
|
|
230
|
|
|
$
|
0.01
|
|
|
-
|
|
|
-
|
|
Adjusted Net
Income
|
|
$
|
40,728
|
|
|
$
|
1.76
|
|
|
$
|
42,372
|
|
|
$
|
1.82
|
|
* 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, and are neither
a substitute for, nor superior to, measures of financial
performance prepared in accordance with GAAP.
Reconciliations of Pre-Tax to After-Tax
Adjustments
|
|
|
|
|
|
|
|
Three Months Ended
March 31
|
|
|
($ in thousands, except per share
amounts)
|
|
2022
|
|
|
EPS
|
|
|
2021
|
|
|
EPS
|
|
|
Pre-Tax Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred Compensation
(Income) Expense
|
|
$
|
(5,195)
|
|
|
|
|
|
|
$
|
1,975
|
|
|
|
|
|
|
Business
Restructuring
|
|
|
52
|
|
|
|
|
|
|
|
81
|
|
|
|
|
|
|
Cash Settled Stock
Appreciation Rights
|
|
|
(529)
|
|
|
|
|
|
|
|
261
|
|
|
|
|
|
|
Environmental
Remediation
|
|
|
303
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
Total
Pre-Tax Adjustments
|
|
$
|
(5,369)
|
|
|
|
|
|
|
$
|
2,317
|
|
|
|
|
|
|
Cumulative Tax Effect
on Adjustments
|
|
$
|
1,288
|
|
|
|
|
|
|
$
|
(556)
|
|
|
|
|
|
|
After-Tax Adjustments
|
|
$
|
(4,081)
|
|
|
$
|
(0.17)
|
|
|
$
|
1,761
|
|
|
$
|
0.08
|
|
|
Table
III
|
|
|
|
Deferred
Compensation Plan
|
|
|
|
The full effect of the
deferred compensation plans on quarterly pre-tax income was $5.2
million of income versus $2.0 million of expense in the prior
year. The accounting for the deferred compensation plans
results in operating income when the price
of Stepan Company common
stock or mutual funds held in the plans fall and expense when they
rise. The Company also recognizes the change in value of
mutual funds as investment income or loss. The quarter end
market prices of Company common stock were as follows:
|
|
|
|
|
|
2022
|
|
|
2021
|
|
|
|
3/31
|
|
|
12/31
|
|
|
9/30
|
|
|
6/30
|
|
|
3/31
|
|
Stepan
Company
|
|
$
|
98.81
|
|
|
$
|
124.29
|
|
|
$
|
112.94
|
|
|
$
|
120.27
|
|
|
$
|
127.11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The deferred compensation income statement impact is summarized
below:
|
|
Three Months Ended
March 31
|
|
($ in thousands)
|
|
2022
|
|
|
2021
|
|
Deferred Compensation
|
|
|
|
|
|
|
|
|
Operating Income (Expense)
|
|
$
|
7,501
|
|
|
$
|
(2,694)
|
|
Other, net – Mutual Fund Gain (Loss)
|
|
|
(2,306)
|
|
|
|
719
|
|
Total Pre-Tax Income
(Expense)
|
|
$
|
5,195
|
|
|
$
|
(1,975)
|
|
Total After Tax Income
(Expense)
|
|
$
|
3,948
|
|
|
$
|
(1,501)
|
|
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 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-month period ending March 31, 2022 as compared to
2021:
|
|
($ in millions)
|
|
Three Months Ended
March 31
|
|
|
Increase
|
|
|
Change
Due to Foreign
Currency
Translation
|
|
|
|
2022
|
|
|
2021
|
|
|
|
|
|
|
|
|
|
Net Sales
|
|
$
|
675.3
|
|
|
$
|
537.7
|
|
|
$
|
137.6
|
|
|
$
|
(11.6)
|
|
Gross
Profit
|
|
|
109.2
|
|
|
|
109.0
|
|
|
|
0.2
|
|
|
|
(1.7)
|
|
Operating
Income
|
|
|
63.3
|
|
|
|
53.9
|
|
|
|
9.4
|
|
|
|
(1.1)
|
|
Pretax
Income
|
|
|
59.4
|
|
|
|
53.1
|
|
|
|
6.3
|
|
|
|
(1.1)
|
|
Table V
|
|
|
|
Stepan Company
Consolidated Balance
Sheets
March 31, 2022 and
December 31, 2021
|
|
|
|
|
|
March 31, 2022
|
|
|
December 31, 2021
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
$
|
1,081,871
|
|
|
$
|
913,368
|
|
Property, Plant &
Equipment, Net
|
|
|
892,581
|
|
|
|
850,604
|
|
Other
Assets
|
|
|
298,144
|
|
|
|
301,640
|
|
Total
Assets
|
|
$
|
2,272,596
|
|
|
$
|
2,065,612
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
$
|
611,062
|
|
|
$
|
500,476
|
|
Deferred Income
Taxes
|
|
|
10,963
|
|
|
|
12,491
|
|
Long-term
Debt
|
|
|
397,760
|
|
|
|
322,862
|
|
Other Non-current
Liabilities
|
|
|
136,073
|
|
|
|
155,590
|
|
Total Stepan Company
Stockholders' Equity
|
|
|
1,116,738
|
|
|
|
1,074,193
|
|
Noncontrolling
Interest
|
|
|
-
|
|
|
|
-
|
|
Total Liabilities and
Stockholders' Equity
|
|
$
|
2,272,596
|
|
|
$
|
2,065,612
|
|
SOURCE Stepan Company