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February 23, 2026 Fourth Quarter 2025 Earnings Results
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Safe Harbor Certain information in this presentation 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 (the Exchange Act). 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,” “aim,” “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 presentation. 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 disruptions in production or accidents at 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 make acquisitions of suitable candidates and successfully 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, changes in global trade policies, including tariffs; 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 our executive management and key personnel; and our debt covenants. In addition to the risks described in the Company’s periodic reports, the restructuring actions described herein may involve risks related to the execution of facility closures and asset decommissioning, potential operational disruptions, impacts on employees and local communities, environmental compliance, and the realization of anticipated cost savings and efficiencies. 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, except to the extent required by applicable laws. 2
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Stepan Company: Agenda Invest in Organic Growth 3 AGENDA 2025 Fourth Quarter Financial Results 2025 Full Year Financial Results Strategic Outlook – Project Catalyst Closing Remarks Q&A 1 2 3 4 5
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Stepan Company: Highlights CEO Remarks - 2025 Full Year Highlights (1) Adjusted Net Income is a Non-GAAP measure. See Appendix II for a GAAP reconciliation. (2) EBITDA and Adjusted EBITDA are Non-GAAP measures. See Appendices IV and VII for GAAP reconciliations. (3) Free Cash Flow is a Non-GAAP measure. See Appendix V for GAAP reconciliations. 4 Reported Net Income $46.9MM Adjusted Net Income(1) $41.7MM -7% Y oY EBITDA(2) $208.0MM Adjusted EBITDA(2) $198.9MM +11% Y oY +6% Y oY Organic Sales Volume +2% YoY Cash From Operations $25.4 MM -35% Y oY -17% Y oY Free Cash Flow(3) $147.9MM -9% Y oY ▪ Record Year on Safety Performance. ▪ Delivered Adjusted EBITDA growth despite a challenging operating environment. ▪ Delivered strong volume growth in all Strategic Segments (e.g. Crop Productivity, Oilfield, Tier 2/3, NA Polymers, among others). ▪ Successfully commissioned our Pasadena, TX facility. ▪ Delivered Positive Free Cash Flow generation and Net Leverage Ratio improved from 2.8x to 2.5x. ▪ Established the framework for Project Catalyst, strengthening the foundation for sustainable and profitable growth.
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(1) Adjusted Net Income/Loss is a Non-GAAP measure. See Appendix II for a GAAP reconciliation. (2) EBITDA and Adjusted EBITDA are Non-GAAP measures. See Appendices III and VII for GAAP reconciliations. (3) Free Cash Flow is a Non-GAAP measure. See Appendix V for GAAP reconciliations. FLAT ORGANIC SALES VOLUME ▪ Global Organic sales volume, excluding divestitures, was flat. Double digit growth across Polymers and Specialty Products was offset by weaker end-market demand in Functional and Global Commodity Consumer Surfactants. POSITIVE FREE CASH FLOW(3) ▪ Free cash flow (FCF)(3) was $25.4 million compared to ($0.2) million in the prior year, driven by reductions in working capital. 5 Reported Net Income $5.0MM Adjusted Net Loss(1) ($0.5MM) +49% Y oY EBITDA(2) $43.3MM Adjusted EBITDA(2) $33.8MM +21% Y oY -3% Y oY Organic Sales Volume Flat YoY Cash From Operations $25.4 MM Free Cash Flow(3) $60.0MM +103% Y oY Fourth Quarter - Highlights Stepan Company: Highlights STRATEGIC UPDATE ▪ Production in Pasadena continues to ramping up as planned and the divesture of our Philippines and Lake Providence assets was completed. ADJUSTED NET INCOME DOWN ▪ Reported net income was $5.0 million, up 49% versus the prior year. Adjusted net income(1) was a $0.5 million loss, down 119% versus the prior year. The decrease in earnings was mainly driven by higher interest expense, a less favorable effective tax rate, higher expenses at Pasadena and lower Surfactant earnings. ADJUSTED EBITDA DOWN ▪ EBITDA(2) was $43.3 million, up 21% year-over-year, while Adjusted EBITDA(2) was $33.8 million, down 3%.
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Stepan Company: Financial Results (1) See Appendix VIII for Adjustments Details. (2) Adjusted Net Income/Loss and Adjusted EPS are Non-GAAP measures that exclude certain significant, non-recurring items. See Appendix II for GAAP reconciliations. (3) Corporate Expenses & All Other consists of the following buckets: I. Corporate Expense reduction of $0.8 million, II. Other, net of $0.5 million, and III. Interest Expense increase of ($0.9) million. Adj. Net Income Bridge $2.8 $1.7 ($4.5) ($0.5) ($0.4) Q4 2024 Adjusted Net Income(2) Q4 2025 Pre-Tax Income Tax Provision $4.0 Q4 2025 Adjusted Net Income(2) $0.4 Specialty Products Operating Income Polymers Operating Income $0.6 Surfactants Operating Income ($6.8) Q4 2024 Pre-Tax Income Tax Provision ($1.1) Corporate Expenses & All Other(3) $0.12 Adj. EPS(1) ($0.02) Adj. EPS(1) 6 Q4 2024 to Q4 2025 Note: All amounts are in millions of U.S. dollars.
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Stepan Company: Financial Results Adjusted EBITDA(1) Bridge 7 $35.0 $33.8 $1.0 $0.8 Q4 2024 Adj. EBITDA(1) ($2.6) Surfactants Polymers ($0.4) Specialty Products Corporate Q4 2025 Adj. EBITDA(1) Note: All amounts are in millions of U.S. dollars. (1) Adjusted EBITDA is a Non-GAAP measure. See Appendices III and VII for GAAP reconciliations. Q4 2024 to Q4 2025 ▪ Surfactants Adjusted EBITDA(1) decreased 7%, compared to prior year. Organic (ex-divestitures) sales volume decreased by 3% year-over-year due to lower demand across Commodity Consumer and Construction & Industrial Solutions end-markets; partially offset by double-digit growth in Household Institutional & Industrial solutions end-markets. ▪ Polymers Adjusted EBITDA(1) increased by $1.0 million, or 9%, year-over-year driven by strong sales volume growth of 11%, primarily in North America & Asia Rigid Polyols and Phthalic Anhydride; partially offset by lower unit margins and unfavorable product mix. ▪ Specialty Products Adjusted EBITDA(1) decreased by $0.4 million primarily due to order timing fluctuations within the pharmaceutical business; largely offset by double digit sales volume growth in our Medium-Chain Triglycerides (MCT) product line. ▪ Corporate expenses were down 4% year-over-year primarily driven by the non-recurrence of CEO transition expenses in the fourth quarter of 2024.
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▪ North America and Asia adversely impacted by lower organic demand within Commodity Consumer and Functional end markets and raw material (oleochemicals) cost escalation, nearly offset by pricing actions. ▪ Latin America results were impacted by softer demand in Functional Products end markets and lower sales with our Distribution partners; partially offset by organic growth in Commodity Consumer end markets. ▪ Europe results benefited by single digit organic growth across Commodity Consumer & Functional Products end markets; largely offset by lower sales with our Distribution partners. Stepan Company: Business Segments ▪ Organic Volume (ex-divestitures) was down 3% year-over-year primarily due to lower organic demand across Commodity Consumer and Construction & Industrial Solutions end-markets. ▪ Price/Mix benefited from pass through of higher raw material costs, improved product and customer mix, and pricing actions. ▪ F/X positively impacted net sales by 3%. 8 $34.7 $32.1 $0.2 Q4 2024 Adj. EBITDA(1) ($1.6) North America + Asia ($1.2) Latin America Europe Q4 2025 Adj. EBITDA(1) Adjusted EBITDA(1) Bridge $378.8 $401.8 $38.1 $12.5 Q4 2024 Net Sales ($27.5) Volume Price/Mix F/X Q4 2025 Net Sales Net Sales Bridge Note: All amounts are in millions of U.S. dollars. (1) Adjusted EBITDA is a Non-GAAP measure. See Appendices III and VII for GAAP reconciliations. Surfactants Q4 2024 to Q4 2025 Note: All amounts are in millions of U.S. dollars.
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▪ Volume was up 11% driven by growth across our North America & Asia Rigid Polyol and Commodity Phthalic Anhydride businesses. ▪ Price/Mix was impacted by the contracted pass-through of lower raw material costs and competitive pressures. ▪ F/X positively impacted net sales by 2%. ▪ North America results benefited from sales volume growth in the Rigid Polyols and Commodity Phthalic Anhydride businesses, which was partially offset by less favorable product mix. ▪ Europe results were impacted by lower Rigid Polyol demand and continued competitive pressures. ▪ Asia results were driven by higher Rigid Polyols and Specialties Polyols end market demand. 9 $11.4 $12.4 $1.9 $1.4 Q4 2024 Adj. EBITDA(1) North America ($2.4) Europe Asia + Latin America Q4 2025 Adj. EBITDA(1) $129.8 $131.7 $14.4 $3.5 Q4 2024 Net Sales Volume ($16.0) Price/Mix F/X Q4 2025 Net Sales (1) Adjusted EBITDA is a Non-GAAP measure. See Appendices III and VII for GAAP reconciliations. Stepan Company: Business Segments Polymers Q4 2024 to Q4 2025 Net Sales Bridge Adjusted EBITDA(1) Bridge Note: All amounts are in millions of U.S. dollars. Note: All amounts are in millions of U.S. dollars.
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Adj. Net Income Bridge Stepan Company: Financial Results $50.5 $60.6 $50.9 $41.7 $10.1 $2.6 $4.7 $1.3 FY 2024 Adjusted Net Income(2) Tax Provision FY 2024 Pre-Tax Income ($18.3) Surfactants Operating Income Polymers Operating Income Specialty Products Operating Income Corporate Expenses & All Other(3) FY 2025 Pre-Tax Income ($9.2) Tax Provision FY 2025 Adjusted Net Income(2) $2.20 Adj. EPS(1) $1.82 Adj. EPS(1) 10 FY 2024 to FY 2025 (1) See Appendix VIII for Adjustments Details (2) Adjusted Net Income/Loss and Adjusted EPS are Non-GAAP measures that exclude certain significant, non-recurring items. See Appendix II for GAAP reconciliations. (3) Corporate Expenses & All Other consists of the following buckets: I. Corporate Expense reduction of $8.0 million, II. Other, net of $1.1 million, and III. Interest Expense increase of ($7.9) million. Note: All amounts are in millions of U.S. dollars.
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Stepan Company: Financial Results Adjusted EBITDA(1) Bridge 11 $187.0 $198.9 $3.3 $4.7 $8.5 FY 2024 Adj. EBITDA(1) ($4.6) Surfactants Polymers Specialty Products Corporate FY 2025 Adj. EBITDA(1) Note: All amounts are in millions of U.S. dollars. (1) Adjusted EBITDA is a Non-GAAP measure. See Appendices IV and VII for GAAP reconciliations. FY 2024 to FY 2025 ▪ Surfactants Adjusted EBITDA(1) declined 3%, year-over-year, largely driven by higher start-up expenses associated with our new alkoxylation site in Pasadena, Texas, lower sales volume within Global Commodity Laundry & Cleaning end-markets, and elevated Oleochemicals raw material costs. These were partially offset by improved product and customer mix, pricing actions, and double-digit volume growth in Agricultural and Oilfield end-markets. ▪ Polymers Adjusted EBITDA(1) increased by 5%, compared to prior year, driven by strong sales volume growth across North America Rigid Polyols, Global Specialty Polyols, and commodity Phthalic Anhydride. Higher volumes and improved operating leverage more than offset lower selling prices, unfavorable product mix, and higher cost inventory carryover earlier in the year. ▪ Specialty Products Adjusted EBITDA(1) increased by 17%, year-over-year, primarily due to both, volume growth and margin recovery in our Medium- Chain Triglycerides (MCT) product line. ▪ Corporate expenses were down 12% year-on-year, largely due to the non-recurrence of expenses associated with an externally generated criminal social engineering fraud event in 2024 and expenses related to our CEO transition in 2024.
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Stepan Company: Financial Results Balance Sheet & Cash Flow Net Debt(1) TTM Adjusted EBITDA(2) 2025 Working Capital(4) 12 Free Cash Flow(5) ($MM) (1) Net Debt is a Non-GAAP measure. See Appendix VI for a GAAP reconciliation. (2) TTM Adjusted EBITDA is a Non-GAAP measure. See Appendix IV for a GAAP reconciliation. (3) Net Debt / TTM Adjusted EBITDA Ratio is a Non-GAAP measure. See Appendix VI for a GAAP reconciliation. (4) Includes the following components of Working Capital: accounts receivable, inventory, accounts payable (5) Free Cash Flow is a Non-GAAP measure. See Appendix V for GAAP reconciliations. Q4 2024 to Q4 2025 494 199 Net Debt(1) / TTM Adjusted EBITDA(2) ($MM) 2.5 Net Debt/TTM Adj EBITDA Ratio(3) Capital Expenditures $MM 2023 260 2024 123 Q4 2024 29.7 Q4 2025 34.6 2025 122.5 $MM 2023 455 Q4 2024 418 Q4 2025 425
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13 Stepan Company: Strategy Engaged, Agile & Accountable Organization Safety, Stewardship & Compliance Delivering Superior Shareholder Value Through a Balanced Growth Strategy 13
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New Operational Model New Organizational Structure 14 Stepan Company: Project Catalyst 14 Project Catalyst Strengthening our Foundation for Long-Term Excellence Project Catalyst is a comprehensive operational and efficiency initiative designed to deliver approximately $100 million in pre-tax savings over the next two years, with an expected ~60% realized in 2026. This program will streamline our global manufacturing footprint and strengthen the foundation for sustainable and profitable growth. Operational Efficiency & Cost Optimization ▪ Optimize production and reduce cost by consolidating volumes into our network at efficient sites and high- performing assets, enhancing scale, reliability and productivity Footprint Optimization Organizational Effectiveness ▪ Implement clear accountabilities across businesses and functions and focus resources to capture market opportunities to advance the Company’s growth strategy ▪ Capturing procurement savings while advancing productivity through end-to-end operational excellence $~100MM In Pre-Tax Savings
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15 Stepan Company: Footprint Optimization Fieldsboro, New Jersey – Site Closure1 The Fieldsboro site provides sulfonation, betaine, and specialty-tolled products. Consolidating production into our broader network better aligns capacity with demand and is expected to reduce structural costs, streamline operations and strengthen supply reliability. This is in response to continued lower demand in commodity surfactants used in the production of laundry detergents. Stalybridge, UK – Organics, Asset Decommissioning1 The Stalybridge organics assets face high operating costs and decreased utilization. As a result, we are consolidating volumes into other more efficient assets across our network. In parallel, we are exiting a small, unprofitable, capital-intensive business to enhance the site’s overall cash profitability. Elwood (Millsdale) IL – Alkoxylation Asset Decommissioning1 The Millsdale alkoxylation assets are being decommissioned and products previously manufactured here will be consolidated across our broader network with a primary shift to our new, modern and more efficient facility in Pasadena, Texas. This transition leverages scale advantages that are expected to reduce structural costs, improve reliability, and support long-term growth in high-value market segments. 1 Refer to Appendix IX for a summary of the cash impact resulting from the actions above. Footprint Optimization These initiatives are intended to optimize production and reduce cost by consolidating volumes into our network at efficient sites and high-performing assets, enhancing scale, reliability and productivity. These actions follow the previously announced sale of the Philippines and Lake Providence sites at the end of 2025.We will continue looking for opportunities to optimize our asset base.
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16 Stepan Company –> Growth Drivers 16 Thank You Ruben Velasquez Vice President & Chief Financial Officer +1-847-446-7500
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Appendix Additional Sources of Information and Definitions
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Stepan Company: Appendix I Update on Certain Expectations (millions USD) 2022 Actual 2023 Actual 2024 Actual 2025 Actual 2026 Forecast Capital Expenditures 301 260 123 122.5 105 - 115 Debt Repayments 38 38 49 63 59 Interest Net 10 12 14 22 27 – 29 Depreciation & Amortization 95 105 112 126 125 – 130 Effective Tax Rate(1) (%) 22% 17% 17% 22% 25 - 27% 18 (1) Effective Tax Rate (ETR) increase related to new US tax legislation enacted on July 4, 2025, and lower R&D tax credits estimates.
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Stepan Company: Appendix II Reconciliation of Non-GAAP Adjusted Net Income and Earnings Per Diluted Share(1) Reconciliation of Pre-Tax to After-Tax Adjustments 19 Reconciliations (1) All amounts in this table are presented after-tax
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Stepan Company: Appendix III Adjusted EBITDA and EBITDA Reconciliations Q4 2025 and Q4 2024(1) (1) Refer to Income Statement on appendix VII for a bridge between Operating Income and Net Income. 20 Adjusted EBITDA and EBITDA Reconciliations Q4 2025 and Q4 2024(1)
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Stepan Company: Appendix IV 2025 and 2024 Full Year 21 Adjusted EBITDA Reconciliation Adjusted EBITDA and EBITDA Reconciliations 2025 and 2024 Full Year(1) (1) Refer to Income Statement on appendix VII for a bridge between Operating Income and Net Income.
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Stepan Company: Appendix V (million USD) 2025 2024 2023 Cash Flow from Operations 147.9 162.1 174.9 Capital Expenditures (122.5) (122.8) (260.3) Free Cash Flow 25.4 39.3 (85.5) (million USD) Q4 2025 Q4 2024 Cash Flow from Operations 60.0 29.5 Capital Expenditures (34.6) (29.7) Free Cash Flow 25.4 (0.2) Free Cash Flow (FCF) 22 Reconciliations
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Stepan Company: Appendix VI (millions USD) December 31, 2025 September 30, 2025 June 30, 2025 March 31, 2025 December 31, 2024 December 31, 2023 December 31, 2022 December 31, 2021 December 31, 2020 Total Debt 626.7 655.5 658.0 659.3 625.4 654.1 587.1 363.6 198.7 Cash 132.7 118.5 88.9 107.5 99.7 129.8 173.8 159.2 349.9 Net Debt 494.0 537.0 569.1 551.8 525.7 524.3 413.3 204.4 (151.2) Equity 1,244.0 1,246.8 1,241.7 1,200.5 1,169.9 1,216.5 1,166.1 1,074.2 986.7 Net Debt + Equity 1,738.0 1,783.8 1,810.8 1,752.3 1,695.6 1,740.8 1,579.4 1,278.6 835.5 Net Debt / (Net Debt + Equity) 28% 30% 31% 31% 31% 30% 26% 16% (18%) Net Debt to Total Capitalization Ratio Net Debt/TTM Adjusted EBITDA Ratio = 494/199 = 2.5 23
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Stepan Company: Appendix VII Income Statement 24
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Stepan Company: Appendix VIII 25 Adjustments Details (1) All amounts in this table are presented after-tax Reconciliation of Non-GAAP Adjusted Net Income and Earnings Per Diluted Share(1)
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(USD millions) Total Cash Impact Estimate 1 Non-Cash Impact Cash Expense Q1 2026 Cash Expense Full Year 2026 Cash Expense 2027-2035 Low High Low High Decommissioning, Dismantling & Environmental 2 $24 $37 - $0.4 $8 $16 $29 Severance and People Related $6 $7 - $3 $6 - - Asset Write- Offs/Accelerated Depreciation 3 - - $58 - $62 - - - - Total $29 $44 $58 - $62 $3 $14 $16 $29 2 Decommissioning, dismantling and environmental costs reflect estimated cash expenditures associated with site closures, asset decommissioning and related compliance activities. Estimates are subject to variability based on the scope and timing of environmental assessments, regulatory review processes and remediation requireme nts. 1 Estimates reflect a preliminary range and are subject to change. Variability within the range is primarily driven by uncertai nties associated with the scope, timing and outcomes of environmental testing at the Fieldsboro, NJ facility, including the potential identification of conditions requiring additional remediation or regulatory actions. 3 Severance and people related costs include employee separation, transition and benefit costs, as well as other costs directly related to the restructuring and organizational effectiveness actions undertaken as part of Project Catalyst. These costs exclude ongoing operating expenses and costs not directly associated with the restru cturing actions described herein. 26 Stepan Company: Appendix IX Estimated Cash Impact – Site Closure & Select Asset Decommissioning (Project Catalyst)