Stepan Company Reports Q2 2025 Financial Results with $31.1 Million Net Income

Stepan Company reported its financial results for the second quarter and first half of 2025, showing a net income of $31.1 million, or $1.36 per diluted share, compared to $23.4 million, or $1.02 per diluted share, in the same period of 2024. The company’s revenue for the first half of 2025 reached $1.19 billion, reflecting a 7% increase from $1.11 billion in the prior year. The growth was primarily driven by higher average selling prices, which contributed $72.9 million to the revenue increase, while sales volume also rose by 2%, adding $27.4 million. However, foreign currency translation negatively impacted revenue by $20.2 million, mainly due to a stronger U.S. dollar against the Mexican peso and Brazilian real.

In terms of operational performance, Stepan's Surfactants segment, which accounted for 71% of total net sales, reported a 9% increase in revenue to $841.8 million, driven by higher selling prices and a slight increase in sales volume. The Polymers segment saw a modest revenue increase of 1% to $308.9 million, while the Specialty Products segment experienced a 17% rise in revenue to $37.3 million, attributed to higher sales volume. Despite the overall revenue growth, the company faced challenges in operating income, with a slight decrease in the Surfactants and Specialty Products segments, while the Polymers segment reported a 15% increase in operating income.

The company’s balance sheet as of June 30, 2025, showed total assets of $2.42 billion, up from $2.30 billion at the end of 2024. Current assets increased to $906.1 million, driven by higher receivables and inventories. Total liabilities also rose to $1.17 billion, with long-term debt increasing to $383.2 million, reflecting the issuance of $75 million in senior unsecured notes. The company’s equity increased to $1.24 billion, supported by retained earnings and additional paid-in capital.

Looking ahead, Stepan Company anticipates continued growth driven by strategic initiatives, including the expansion of its product offerings and geographic reach. The company is also focused on managing its operational costs and improving efficiency in response to market conditions. The management expressed confidence in the company’s liquidity, supported by cash flows from operations and available credit facilities, to meet its capital expenditure plans, which are estimated to be between $120 million and $125 million for 2025. The company remains committed to maintaining compliance with its debt covenants while pursuing growth opportunities in its core segments.