Let's take a look at the console and wait to make sure the webcast is ready. Okay, we're going to go ahead and get started with the next presentation. First off, I wanted to say thank you to everyone who's joined us today in person and those who are joining us via the audio webcast. My name is Joe Noyons. I'm with Three Part Advisors. Up next, we have Stepan Company, traded on the New York Stock Exchange under the symbol SCL. Presenting on behalf of the company today, we have Sam Hinrichsen, Global VP of Finance and Investor Relations. Hello everyone, and welcome to the Stepan Presentation. I will provide a brief overview of our company, approximately 10 minutes-15 minutes, and we can then open it up for Q&A. If you think about Stepan as a company, whatever we do, you know, globally as a company, it really breaks down into, A, focusing on what we call priority growth markets. Markets that we'll discuss that we believe have strategic tailwinds for growth and that will be part, a key part of our growth strategy. We also have a history of being a very customer-centric organization. Decades of customer relationships, in some cases, a significant R&D and innovation-focused organization and assets and capabilities in that space. We are constantly working on expanding our customer base, our customer reach, what we call tier two and tier three customer base, again, expanding the base across all of the end markets we serve. We have recently completed some key financial investments. As a matter of fact, the biggest investments in company history. We just launched a new alcoxylation facility in Pasadena, Texas, a couple of months ago. We have made other key strategic investments over the last couple of years that will set us up for future growth to serve our global customer base. As a global manufacturer of specialty and intermediate chemicals, we also focus on what we call operational excellence, cost, and of course, operational excellence across our network. We are a truly global company, manufacturing sites across various continents and countries. We're present in the U.S. and Canada, across Latin America, in Europe, and Asia. If you think about how we are positioned globally from a sales perspective, close to 60% is still based on North America, followed by Europe, and then the remaining countries. That is important as you think about our exposure to tariffs and how we are playing and how we're set up from a global network perspective. Our company breaks down into three reporting segments: Surfactants, Polymers, and Specialty Products. If you think about the surfactants business, it breaks down into essentially six key end markets that we serve: agricultural chemicals that include crop protection and soil health products, oil-fed chemicals, surfactants that make their way into construction and industrial applications, personal care or beauty care products, H&I stands for household, industrial, and institutional cleaning and disinfecting products, and our laundry business. On the polymer side, the biggest part of our polymers business is our Rigid Polyols business, focused on insulation products for our global market. We also produce Specialty Polyols in the C.A.S.E. and powdered resins end markets. We are a producer of PA, metallic, and hydride materials as well. Our Specialty Products business produces specialty products, as the name says, for beverages, for energy drinks, different applications, baby formula, etc. It is a very specialized niche business. We've been in business for over 90 years. If you think about this wide range of end markets that we serve, we could only do this if we apply a variety of chemical processes, highly specialized R&D capabilities, and utilize our customer relationships. If you think about the key end markets, what's driving growth in those markets, what to expect. If you think about agricultural chemicals, the demand for food globally is projected to grow significantly over the long term. The amount of land that is feasible or capable of producing crop is limited. We believe there's going to be continued focus on driving crop productivity and improving crop yields. Oil-fed chemicals, where we are helping oil-fed customers that essentially run oil-fed operations to increase their productivity, become more energy efficient. We also believe there are strategic growth drivers behind it. If you think about construction and industrial solutions, this is a variety of surfactant applications. Long-term government investments in infrastructure, building and construction will be the market drivers for this segment. The Personal Care Specialties business is really providing specialized products for beauty care applications. Personal wellness, a shift towards more natural ingredients, less harmful chemicals, is driving that particular end market. As I mentioned, Rigid Polyols, if you think about the need to conserve energy, to improve insulation, and also meet regulatory requirements such as in the European Union, those are the market drivers behind the Rigid Polyols business. We've talked about the more recent introduction of spray foam insulation chemicals. This also plays into energy efficiency, and it also gives us an entry point into residential insulation. In summary, if we think about how we want to drive EBITDA and free cash flow growth, we will focus on these high margin, high growth end markets that are accretive to us, that we just walked through, primarily, again, agricultural, oil-fed, excuse me, rigid polyols. We will be utilizing our existing customer relationships, and we are focused on expanding our customer base, again, into the tier two and tier three customer base. We have a vast network of R&D capabilities, several global application centers, a highly skilled team of R&D chemists that work in tandem with our customers to create customer-specific solutions, and also drive sustainability efforts. Looking at our manufacturing base, cost and operational excellence is a key part of what we do as a chemicals company, driving efficiencies in manufacturing, investing in the reliability of our assets, and also driving productivity and taking cost out where it's appropriate. I mentioned key investments that we have recently completed. We are proud that our Pasadena, Texas, facility is now live and ramping up. That is the biggest single capital investment in company history. We have invested in M&A opportunities in the past, all while returning cash flow to shareholders. Maybe a quick summary of our innovation and R&D capabilities. Stepan Company employs more than 230 chemists and special R&D specialists globally, 14 application centers. We've introduced 33 new products in 2024, about 10% of our revenue base. When we talk about customer-centric innovation, that really covers everything from technical customer service, creating customer-based solutions, helping customers tweak recipes, formulation and application expertise, creating new products that help customers meet their product needs. It spans across process technology. We want to be a one-stop shop across a various offering of different chemicals and chemical processes for our customers. Of course, analysis and testing and helping customers get products and get recipes to where they need to be to be successful. We talked about existing customer relationships. Some of them span over multiple decades. We have invested in joint projects with those key customers. We continue to expand what we call a tier two and tier three customer base. Those are smaller customers across the entire spectrum of end markets that we serve. Those customers pay a premium for the value-added services that we can provide, whether it's formulation expertise, working on recipes, even helping customers from a logistical perspective. We have added almost 1,800 new customers to our global surfactants business last year and sold more than 3,500 new product-customer combinations in that timeframe. We believe that there is still a significant opportunity, 22,000 potentially new and existing customers that we can sell existing and new products to. From a key strategic investment perspective, the co-alkylation investment in Pasadena, Texas that I just mentioned was a key investment we just completed. We have invested in low 1,4-dioxane capabilities over the last couple of years. We have made several acquisitions if you look at our track record over the last years. We talked about operational excellence. That really includes everything from driving productivity within your manufacturing assets, improving reliability, making sure that overhead growth is kept in pace, and essentially optimizing our global asset base. In summary, what this means from a shareholder returns perspective, we are dedicated to continue to deleverage our balance sheet, manage our balance sheet prudently, be in a position to use that balance sheet to fund future organic and inorganic growth. Of course, improve free cash flow. As I said, we've made significant investments over the last couple of years. We're now returning to normalized levels of capital spending. We are focused on the key end markets we just discussed to grow EBITDA. With this said, and this high-level summary, I'd like to turn it over to Q&A at this point and entertain any questions we have. Please. I noticed by reading the historical financials, sales have actually been headed in the wrong direction for five years. That wrong direction might have accelerated a little bit over the last year or two. Should we get an answer to that? Sure. The question was, you know, it appears that sales are trending in the wrong direction if you look at the last couple of years. One thing I would mention is our top line is impacted by changes in raw material costs because we pass on costs as raw materials change to our customers. As raw material costs fluctuate, so does our top line. If you look at the last couple of years, we have been discussing the weakness in agricultural sales that really didn't go back to year-over-year growth until the middle of last year. That was an outcome of destocking that happened subsequent to 2022. We have more recently talked about weakness in the consumer space. There are pockets where things were impacted. What we have also seen is, again, our agricultural business returning to growth last year. We've seen agricultural and oil-fed surfactants grow double digits during the first half of this year. We have seen the rigid polymers business return to year-over-year growth earlier this year. If you just look at net sales, you're correct. If you look at the underlying factors and the impact on margins, it is not just a downwards trend like that. On your side though, the dollar volume sales have since gone down, I think. Perhaps the line is, you know, if fundamentally, however you measure it, is how steady your run-out is. Think about, you know, you're passing on lower raw material costs to the customer. Your top line goes down, but so does your cost in that space. Next question over here. You had referenced three categories: Surfactants, Polymers, and Specialty Products. What percentage of, maybe not revenue, that's actually an answer, but maybe gross profit dollars? I can't give you a direct specific number there, but our Surfactants business is still the biggest business globally. The Specialty business, again, that's a smaller niche business, and then Polymers, of course, is our second biggest business. Do you have a range you can provide us so we don't have to, otherwise just put down some guessing numbers in our notes? I can't give you a specific number there because we don't provide guidance there, but if you look at the EBITDA margins based on those segments, you can see the differences. There are differences in profitability. The surfactants business, of course, has various end markets, including the more commoditized laundry business. I think looking at those segment-level EBITDA margins is going to give you a good direction. Thank you. Okay, next question. This year and over the past few years, and a bunch of quarters in a row, the dilutive share count is drifting downwards, but there hasn't been a stock purchase since 2022. Yes, the question was, we haven't seen a share repurchase in a couple of years. No, look, what I would say is we have increased dividends for 57 years consecutively. We have made share repurchases, not in the recent past, but we have a track record of doing those. We have returned cash to shareholders, and we continue to do this as part of our holistic capital allocation strategy. You look at the last couple of years, a key priority was funding the key investments, Pasadena and other key investments we just talked about. We are committed to returning cash to shareholders for sure. I guess I understand that. I just don't know how the share counts are getting lower with the stock price. Do they reverse from stock to capital? No, and maybe we can take this offline, but I can't really get into details on that. We have a question here. Sorry, the question was how levered are we? From a leverage perspective, we are currently at about a 2.9 net leverage. As we just discussed, we are committed to continuing to deliver the balance sheet, get it to a spot where again we can use the balance sheet to fund both organic and inorganic growth. If you look at the last couple of years, we have made progress in deleveraging the balance sheet. Not at all. I don't think there's a magic number that we have discussed externally, but you certainly get lower, you know, lower than we currently are at 2.9. Next question over here. you say something about the background of the top management team and what incentives, if any, are part of their executive compensation plans to achieve these ambitious goals? Yes, absolutely. The question was, you know, what are the incentive objectives for our management team to achieve these goals? If you look at our proxy statement, you know, you'll find that we have incentives based on growing company net income, growing EBITDA, and growing free cash flow, among other targets. We are aligning our compensation models with the strategic targets we set forth. Another question here. executives who are driving the strategy right now? The question was, how long has the current management been in place? We have had some management changes over the last year. We had a new CEO appointed in October of last year. He was the previous CFO of the company. We have since appointed a new CFO about five weeks ago. At the same time, we have members of the executive team that have been with the company for basically their entire careers. The management team has gone through those transitions. It is not the same team that was a year ago. Okay, question over here. In the presentation you referenced in 2024, that you added 1,060 new customers. Correct. Seems like a really big number. What seems unsustainable, otherwise you'll have every business as a customer in about two months. Yeah. Do you lose a lot of customers each year? Is that a normal part of the process? Is there something unique about the 2024 number? I just don't understand this industry better. Great question. The question was you added, you know, almost 1,600 new customers, 1,800 new customers. Seems like a high number that's sustainable. What I would say is if you look at the tier two and tier three customer space, some of those are, you know, small accounts as you acquire them. You acquire a new customer, you sell one product to them, they get familiar with you, they understand that Stepan Company can offer a wide range of products, so now you extend the product offering to that particular customer. There's such a highly fragmented market of, you know, we said 20+ potential new customers that we're estimating. You're adding these 1,800 new customers, doesn't mean they're all big accounts at the onset. We have a track record over the last couple of years to continuously add to that customer base and grow our customer reach in that space. How does that, all 1,800 new customers that customer has, how does that compare to the last, let's say, prior five years? I would say it has basically been a continuous trend. If you look at the last couple of earnings calls, we added about 400 new customers in Q2, about almost the same number during the first quarter. We're seeing a sustained trend there. One additional question. Sure. What's your customer loss each year, being those that model as a layer but don't have a repeat or a rotating fallout? Is it a normal trend there? Yeah, I can't go into specifics on customer churn. Of course, you can have customer churn. You can also have customers that are, you know, spotty buyers in the smaller space. Again, if you look at these additions in that space, it has been a continuous trend of broadening that customer reach. Okay, next question over here. What about what percentage of your sales go to your 10 largest customers? Do the three facilities that you say show profitable for the company? Again, we have not talked about this externally, so I can't be too specific. Depending on what market segment you look at, you have different customer concentrations. You have more tier one customers in the consumer space, of course. It also depends to a degree based on what region you're in. The Asia business, that includes surfactants and includes polymers, can't comment on the regional profitability. It has been a core part of our company for a long time. Okay, do we have any additional questions? Yeah, here's a question. If you guys have increased the dividends. 57 years. Okay, so what can you tell us about it? Turn those discussions around. They fought the table and are like, do we have to continue this increase in the dividends? Why didn't we stop that? We're not spending too much money on payable decisions. Oh, sure. No, the question was you've increased dividends for 57 years. Is this something you want to continue? What are the different viewpoints on this? What I would say is, of course, I can't go to specifics. We've made it a point to return cash to shareholders continuously. That's tradition, again, for 57 years. We look at this, of course, as part of our holistic capital deployment and allocation strategy. We have supplemented dividends with share buybacks in the past as well. Of course, you're looking at everything from the capital you want to fund. M&A is always going to be part of a long-term growth strategy. We are committed to continue returning cash to shareholders. I think you were first. Sure, I'll interrupt that. What type of ROI or what are you guys looking to generate? What's the SLV? We haven't provided any guidance or haven't discussed, you know, specific ROIC targets for the plant. Again, the plant serves multiple purposes. It allows us to move production from external toolers in-house, which comes at a benefit. It secures the old supply. It provides capacity for future growth in the alcoxylation segment, which we have publicly stated has grown double digits in the second quarter even. There are multiple benefits that are associated with the site. Yes. Two additional questions. Sure. The first one is you mentioned that 10% of your revenue comes from new products or recently new products. How is that defined? How recent is recent? The second question is, would you discuss the CEO transition? The first question was about 10% of products or revenue was linked to new products in 2024. What does this actually mean? How is this defined? It basically means you're looking at products that are completely new. It's not just a different packaging or a slight modification. It's essentially a new product that we developed, that we launched, and that we are tracking against our total revenue. Call it a product vitality. What time frame? Is that in the last two years or five years? This metric, the 10% was specific to 2024, but we said new products introduced in that year were from new developments. As far as the CEO transition is concerned, again, I can't go into details. What I would say is our CEO, Luis Rojo, served as the CFO before he was appointed, so he's intimately familiar with the company. He has been at Stepan Company since 2018. He has been transitioning into the CEO role in October of last year and has been leading the company since. Yes. Again, about the ownership structure, institutional private investors and the ownership. If you look at the public information on ownership, there is a significant ownership share based on institutional investors for sure. We are a truly public company. I can't discuss specific holdings or specific ownership questions.