Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2023 | Oct. 26, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | SCL | |
Entity Registrant Name | STEPAN COMPANY | |
Entity Current Reporting Status | Yes | |
Entity Central Index Key | 0000094049 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 22,367,381 | |
Entity Tax Identification Number | 36-1823834 | |
Entity File Number | 1-4462 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 1101 Skokie Boulevard | |
Entity Address, Address Line Two | Suite 500 | |
Entity Address, City or Town | Northbrook | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60062 | |
City Area Code | 847 | |
Local Phone Number | 446-7500 | |
Security Exchange Name | NYSE | |
Title of 12(b) Security | Common Stock, $1 par value | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Net Sales | $ 562,226 | $ 719,185 | $ 1,793,637 | $ 2,146,094 |
Cost of Sales | 490,990 | 600,709 | 1,582,444 | 1,786,785 |
Gross Profit | 71,236 | 118,476 | 211,193 | 359,309 |
Operating Expenses: | ||||
Selling | 11,811 | 15,079 | 35,987 | 45,908 |
Administrative | 22,904 | 33,848 | 68,132 | 79,499 |
Research, development and technical services | 14,477 | 16,929 | 43,720 | 50,092 |
Deferred compensation income | (3,101) | (2,131) | (856) | (13,038) |
Total Operating expenses | 46,091 | 63,725 | 146,983 | 162,461 |
Goodwill impairment (Note 16) | 978 | |||
Business restructuring expenses (Note 18) | 5,628 | 92 | 5,827 | 225 |
Operating Income | 19,517 | 54,659 | 58,383 | 195,645 |
Other Income (Expense): | ||||
Interest, net | (2,987) | (2,221) | (9,674) | (7,254) |
Other, net (Note 15) | (690) | (1,980) | 3,348 | (8,999) |
Nonoperating Income (Expense), Total | (3,677) | (4,201) | (6,326) | (16,253) |
Income Before Provision for Income Taxes | 15,840 | 50,458 | 52,057 | 179,392 |
Provision for Income Taxes | 3,269 | 11,074 | 10,660 | 43,073 |
Net Income | $ 12,571 | $ 39,384 | $ 41,397 | $ 136,319 |
Net Income Per Common Share (Note 10): | ||||
Basic | $ 0.55 | $ 1.73 | $ 1.82 | $ 5.98 |
Diluted | $ 0.55 | $ 1.71 | $ 1.8 | $ 5.9 |
Shares Used to Compute Net Income Per Common Share (Note 10): | ||||
Basic | 22,786 | 22,753 | 22,770 | 22,813 |
Diluted | 22,930 | 23,034 | 22,956 | 23,089 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 12,571 | $ 39,384 | $ 41,397 | $ 136,319 |
Other Comprehensive Income: | ||||
Foreign currency translation adjustments (Note 11) | (19,578) | (30,002) | 15,342 | (56,269) |
Defined benefit pension adjustments, net of tax (Note 11) | 61 | 435 | 179 | 1,305 |
Derivative instrument activity, net of tax (Note 11) | 562 | 3,996 | 666 | 8,827 |
Total Other Comprehensive Income | (18,955) | (25,571) | 16,187 | (46,137) |
Comprehensive Income | $ (6,384) | $ 13,813 | $ 57,584 | $ 90,182 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current Assets: | ||
Cash and cash equivalents | $ 105,508 | $ 173,750 |
Receivables, net | 418,218 | 436,914 |
Inventories (Note 6) | 284,546 | 402,531 |
Other current assets | 41,164 | 31,607 |
Total current assets | 849,436 | 1,044,802 |
Property, Plant and Equipment: | ||
Cost | 2,546,520 | 2,370,552 |
Less: Accumulated depreciation | (1,366,548) | (1,297,255) |
Property, plant and equipment, net | 1,179,972 | 1,073,297 |
Goodwill, net (Note 16) | 96,526 | 95,922 |
Other intangible assets, net | 53,548 | 58,026 |
Long-term investments (Note 3) | 24,528 | 23,294 |
Operating lease assets (Note 7) | 65,334 | 62,540 |
Other non-current assets | 64,185 | 75,291 |
Total assets | 2,333,529 | 2,433,172 |
Current Liabilities: | ||
Current maturities of long-term debt (Note 14) | 227,014 | 132,111 |
Accounts payable | 242,628 | 375,726 |
Accrued liabilities | 112,435 | 162,812 |
Total current liabilities | 582,077 | 670,649 |
Deferred income taxes | 9,149 | 10,179 |
Long-term debt, less current maturities (Note 14) | 422,375 | 455,029 |
Non-current operating lease liabilities (Note 7) | 53,653 | 50,559 |
Other non-current liabilities | 63,504 | 80,691 |
Commitments and Contingencies (Note 8) | ||
Equity: | ||
Common stock, $1 par value; authorized 60,000,000 shares; 26,989,085 issued shares in 2023 and 26,840,843 issued shares in 2022 | 26,989 | 26,841 |
Additional paid-in capital | 244,431 | 237,202 |
Accumulated other comprehensive loss (Note 11) | (151,325) | (167,512) |
Retained earnings | 1,267,048 | 1,250,130 |
Less: Common treasury stock, at cost, 4,627,645 shares in 2023 and 4,605,858 shares in 2022 | (184,372) | (180,596) |
Total Stepan Company stockholders’ equity | 1,202,771 | 1,166,065 |
Total liabilities and equity | $ 2,333,529 | $ 2,433,172 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 1 | $ 1 |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 26,989,085 | 26,840,843 |
Treasury stock, shares | 4,627,645 | 4,605,858 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash Flows From Operating Activities | ||
Net income | $ 41,397 | $ 136,319 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 78,315 | 69,958 |
Deferred compensation | (856) | (13,038) |
Realized and unrealized (gains) losses on long-term investments | (2,598) | 8,073 |
Stock-based compensation | 3,677 | 10,012 |
Deferred income taxes | 12,636 | (2,110) |
Goodwill impairment (Note 18) | 978 | |
Other non-cash items | 1,132 | 1,698 |
Changes in assets and liabilities: | ||
Receivables, net | 25,838 | (82,512) |
Inventories | 122,714 | (100,101) |
Other current assets | (10,239) | (5,030) |
Accounts payable and accrued liabilities | (152,096) | 42,625 |
Pension liabilities | (1,474) | (1,685) |
Environmental and legal liabilities | (10,817) | 10,264 |
Deferred revenues | (1,730) | (524) |
Net Cash Provided By Operating Activities | 105,899 | 74,927 |
Cash Flows From Investing Activities | ||
Expenditures for property, plant and equipment | (213,597) | (205,337) |
Business acquisition, net of cash acquired (Note 17) | (9,693) | |
Other, net | 1,669 | 3,156 |
Net Cash Used In Investing Activities | (211,928) | (211,874) |
Cash Flows From Financing Activities | ||
Revolving debt and bank overdrafts, net (Note 14) | 91,003 | 155,141 |
Other debt borrowings (Note 14) | 75,000 | |
Other debt repayments | (28,572) | (28,571) |
Dividends paid | (24,479) | (22,458) |
Company stock repurchased | (22,257) | |
Stock option exercises | 2,386 | 353 |
Other, net | (3,701) | (2,650) |
Net Cash Provided By Financing Activities | 36,637 | 154,558 |
Effect of Exchange Rate Changes on Cash | 1,150 | (11,111) |
Net Increase (Decrease) in Cash and Cash Equivalents | (68,242) | 6,500 |
Cash and Cash Equivalents at Beginning of Period | 173,750 | 159,186 |
Cash and Cash Equivalents at End of Period | 105,508 | 165,686 |
Supplemental Cash Flow Information | ||
Cash payments of income taxes, net of refunds | 26,526 | 23,595 |
Cash payments of interest | $ 20,929 | $ 11,297 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ 12,571 | $ 39,384 | $ 41,397 | $ 136,319 |
Insider Trading Arrangements
Insider Trading Arrangements | 9 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Condensed Consolidated Financia
Condensed Consolidated Financial Statements | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Condensed Consolidated Financial Statements | 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS The condensed consolidated financial statements included herein have been prepared by Stepan Company (the Company), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) have been condensed or omitted pursuant to such rules and regulations, although management believes that the disclosures are adequate and make the information presented not misleading. In the opinion of management, all adjustments, consisting only of normal recurring accruals, necessary to present fairly the Company’s financial position as of September 30, 2023, its results of operations for the three and nine months ended September 30, 2023 and 2022 and cash flows for the nine months ended September 30, 2023 and 2022, have been included. These financial statements and related footnotes should be read in conjunction with the financial statements and related footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (2022 Annual Report on Form 10-K). |
Reconciliations of Equity
Reconciliations of Equity | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Reconciliations of Equity | 2. RECONCILIATIONS OF EQUITY Below are reconciliations of total equity for the three and nine months ended September 30, 2023 and 2022: (In thousands, except share and per share amounts) Total Common Additional Common Accumulated Retained Balance, June 30, 2023 $ 1,215,097 $ 26,978 $ 242,215 $ ( 184,365 ) $ ( 132,370 ) $ 1,262,639 Issuance of 10,730 shares of 470 11 459 — — — Stock-based and deferred compensation 1,750 — 1,757 ( 7 ) — — Net income 12,571 — — — — 12,571 Other comprehensive income ( 18,955 ) — — — ( 18,955 ) — Cash dividends paid: Common stock ($ 0.365 per share) ( 8,162 ) — — — — ( 8,162 ) Balance, September 30, 2023 $ 1,202,771 $ 26,989 $ 244,431 $ ( 184,372 ) $ ( 151,325 ) $ 1,267,048 (In thousands, except share and per share amounts) Total Common Additional Common Accumulated Retained Balance, December 31, 2022 $ 1,166,065 $ 26,841 $ 237,202 $ ( 180,596 ) $ ( 167,512 ) $ 1,250,130 Issuance of 43,502 shares of 2,386 44 2,342 — — — Stock-based and deferred compensation 1,215 104 4,887 ( 3,776 ) — — Net income 41,397 — — — — 41,397 Other comprehensive income 16,187 — — — 16,187 — Cash dividends paid: Common stock ($ 1.095 per share) ( 24,479 ) — — — — ( 24,479 ) Balance, September 30, 2023 $ 1,202,771 $ 26,989 $ 244,431 $ ( 184,372 ) $ ( 151,325 ) $ 1,267,048 (In thousands, except share and per share amounts) Total Common Additional Common Accumulated Retained Balance, June 30, 2022 $ 1,125,711 $ 26,825 $ 229,510 $ ( 172,322 ) $ ( 173,802 ) $ 1,215,500 Issuance of 2,734 shares of 169 3 166 — — — Purchase of 54,780 shares of ( 5,281 ) — — ( 5,281 ) — — Stock-based and deferred compensation 3,300 1 3,360 ( 61 ) — — Net income 39,384 — — — — 39,384 Other comprehensive income (loss) ( 25,571 ) — — — ( 25,571 ) — Cash dividends paid: Common stock ($ 0.335 per share) ( 7,473 ) — — — — ( 7,473 ) Balance, September 30, 2022 $ 1,130,239 $ 26,829 $ 233,036 $ ( 177,664 ) $ ( 199,373 ) $ 1,247,411 (In thousands, except share and per share amounts) Total Common Additional Common Accumulated Retained Balance, December 31, 2021 $ 1,074,193 $ 26,761 $ 220,820 $ ( 153,702 ) $ ( 153,236 ) $ 1,133,550 Issuance of 5,381 shares of 353 5 348 — — — Purchase of 222,720 shares of ( 22,257 ) — — ( 22,257 ) — — Stock-based and deferred compensation 10,226 63 11,868 ( 1,705 ) — — Net income 136,319 — — — — 136,319 Other comprehensive income (loss) ( 46,137 ) — — — ( 46,137 ) — Cash dividends paid: Common stock ($ 1.005 per share) ( 22,458 ) — — — — ( 22,458 ) Balance, September 30, 2022 $ 1,130,239 $ 26,829 $ 233,036 $ ( 177,664 ) $ ( 199,373 ) $ 1,247,411 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. FAIR VALUE MEASUREMENTS Derivative assets and liabilities include the foreign currency exchange and interest rate swap contracts discussed in Note 4, Derivative Instruments , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q). Fair value and carrying value were the same because the contracts were recorded at fair value. The fair values of the foreign currency contracts were calculated as the difference between the applicable forward foreign exchange rates at the reporting date and the contracted foreign exchange rates multiplied by the contracted notional amounts. The fair value of the interest rate swaps was calculated as the difference between the contracted swap rate and the floating interest rate multiplied by the present value of the notional amount of the contract. At September 30, 2023, and December 31, 2022 , the fair values and related carrying values of debt, including current maturities, were as follows (the fair value and carrying value amounts are presented without regard to unamortized debt issuance costs of $ 1,017,000 and $ 686,000 as of September 30, 2023 and December 31, 2022, respectively): (In thousands) September 30, December 31, Fair value $ 604,979 $ 541,029 Carrying value 650,406 587,826 The following tables present financial assets and liabilities, excluding cash and cash equivalents, measured on a recurring basis at fair value as of September 30, 2023, and December 31, 2022, and the level within the fair value hierarchy in which the fair value measurements fall: (In thousands) September 30, Level 1 Level 2 Level 3 Mutual fund assets $ 24,528 $ 24,528 $ — $ — Derivative assets: Interest rate contracts 9,030 — 9,030 — Foreign currency contracts 1,690 — 1,690 — Total assets at fair value $ 35,248 $ 24,528 $ 10,720 $ — Derivative liabilities: Foreign currency contracts $ 2,031 $ — $ 2,031 $ — (In thousands) December 31, Level 1 Level 2 Level 3 Mutual fund assets $ 23,294 $ 23,294 $ — $ — Derivative assets: Interest rate contracts 8,357 — 8,357 — Foreign currency contracts 513 — 513 — Total assets at fair value $ 32,164 $ 23,294 $ 8,870 $ — Derivative liabilities: Foreign currency contracts $ 525 $ — $ 525 $ — |
Derivative Instruments
Derivative Instruments | 9 Months Ended |
Sep. 30, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | 4. DERIVATIVE INSTRUMENTS At September 30, 2023, and December 31, 2022 , the Company had open forward foreign currency exchange contracts to buy or sell foreign currencies with U.S. dollar equivalent amounts of $ 104,699,000 and $ 56,746,000 , respectively. All forward foreign exchange contracts at September 30, 2023 had durations of one month to three months . The Company is currently exposed to volatility in short-term interest rates and has mitigated certain portions of that risk by using an interest rate swap. The interest rate swap is recognized on the balance sheet as either an asset or a liability measured at fair value. At September 30, 2023 , the Company held an interest rate swap contract with a notional value of $ 100,000,000 that was designated as a cash flow hedge. Period-to-period changes in the fair value of the interest rate swap are initially recognized as gains or losses in other comprehensive income. As the interest rate swap contract is settled, the corresponding gain or loss is reclassified out of accumulated other comprehensive income (AOCI) into earnings. The maturity date of the current interest swap contract is March 10, 2027 , which is closely aligned with the June 24, 2027 maturity of the Company's revolving credit facility. The fair values of the derivative instruments held by the Company on September 30, 2023, and December 31, 2022, are disclosed in Note 3, Fair Value Measurements , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q). Derivative instrument gains and losses for the three and nine months ended September 30, 2023 and 2022, were immaterial. For amounts reclassified out of AOCI into earnings for the three and nine months ended September 30, 2023 and 2022, see Note 11, Accumulated Other Comprehensive Income (Loss) , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q). |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation | 5. STOCK-BASED COMPENSATION Compensation expense recorded for all stock options, performance shares, time-based restricted stock units (RSUs) and stock appreciation rights (SARs) was as follows: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 $ 1,520 $ 3,057 $ 3,677 $ 10,012 The decrease in stock-based compensation expense for both the third quarter and first nine months of 2023, compared to the same periods of 2022, was primarily attributable to Company management lowering its assessment of the achievement of performance targets for certain grants and the non-recurrence of accelerated vesting of certain equity grants for the Company's former Chief Executive Officer, who retired on April 25, 2022. Unrecognized compensation costs for stock options, performance shares, RSUs and SARs were as follows: (In thousands) September 30, December 31, Stock options $ 283 $ 692 Performance shares and RSUs 4,658 6,144 SARs 4,677 5,211 The change in unrecognized compensation costs reflects the 2023 grants of stock options, performance shares, RSUs and SARs and Company management lowering its assessment of the achievement of performance targets for certain grants. The Company granted the following awards in the first nine months of 2023: Shares Stock options 2,777 Performance shares (at target) and RSUs 87,025 SARs 77,006 The unrecognized compensation costs at September 30, 2023 , are expected to be recognized over weighted-average periods of 1.1 years for stock options, 1.8 years for performance shares and RSUs and 1.7 years for SARs. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | 6. INVENTORIES The composition of inventories at September 30, 2023, and December 31, 2022, was as follows: (In thousands) September 30, 2023 December 31, 2022 Finished goods $ 186,788 $ 250,373 Raw materials 97,758 152,158 Total inventories $ 284,546 $ 402,531 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | 7. LEASES Lease cost is recognized in both the Cost of Sales and Operating Expenses sections of the Condensed Consolidated Statements of Income. (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Lease Cost Operating lease cost $ 4,448 $ 3,917 $ 13,255 $ 11,968 Short-term lease cost 2,697 1,887 8,215 4,587 Variable lease cost 674 205 1,834 630 Total lease cost $ 7,819 $ 6,009 $ 23,304 $ 17,185 Other Information Cash paid for amounts included in the Operating cash flow from operating $ 4,447 $ 3,903 $ 13,276 $ 11,908 Right-of-use assets obtained in exchange 916 455 8,336 4,017 The following table outlines the maturities of lease liabilities as of September 30, 2023. (In thousands) Undiscounted Cash Flows: 2023 (excluding the nine months ended September 30, 2023) $ 4,310 2024 13,549 2025 9,346 2026 6,976 2027 6,270 Subsequent to 2027 38,179 Total Undiscounted Cash Flows $ 78,630 Less: Imputed interest ( 12,190 ) Present value $ 66,440 Current operating lease liabilities (1) 12,787 Non-current operating lease liabilities 53,653 Total lease liabilities $ 66,440 (1) This item is included in the Accrued liabilities line on the Company’s Condensed Consolidated Balance Sheet. Weighted-average remaining lease term-operating leases 9 Years Weighted-average discount rate-operating leases 3.6 % As of September 30, 2023 , the Company had equipment and railcars leases, valued at approximately $ 5,959,000 , that had not commenced. These leases will commence during the fourth quarter of 2023 and the first quarter of 2024 with lease terms ranging from 1 year to 7 years. |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | 8. CONTINGENCIES There are a variety of legal proceedings pending or threatened against the Company that occur in the normal course of the Company’s business, the majority of which relate to environmental assessment, protection and remediation matters. Some of these proceedings may result in fines, penalties, judgments or costs being assessed against the Company at some future time. The Company’s operations are subject to extensive local, state and federal regulations, including the U.S. Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA) and the Superfund amendments of 1986 (Superfund) as well as comparable regulations applicable to the Company’s foreign locations. Over the years, the Company has received requests for information related to or has been named by government authorities as a potentially responsible party (PRP) at a number of sites where cleanup costs have been or may be incurred by the Company under CERCLA and similar state statutes. In addition, the Company is from time to time involved in routine legal proceedings incidental to the conduct of its business, including personal injury, property damage, tax, trade and labor matters. The Company believes that it has made adequate provisions for the costs it is likely to incur with respect to these claims. In determining the appropriate level of environmental reserves, the Company considers several factors such as information obtained from investigatory studies; changes in the scope of remediation; the interpretation, application and enforcement of laws and regulations; changes in the costs of remediation programs; the development of alternative cleanup technologies and methods; and the relative level of the Company’s involvement at various sites for which the Company is allegedly associated. The level of annual expenditures for remedial, monitoring and investigatory activities will change in the future as major components of planned remediation activities are completed and the scope, timing and costs of existing activities are changed. As of September 30, 2023 , the Company estimated a range of possible environmental losses and legal losses of $ 21,814,000 to $ 45,769,000 . Within the range of possible environmental losses and legal losses, management has currently concluded that no single amount is more likely to occur than any other amounts in the range and, thus, has accrued at the lower end of the range. These accruals totaled $ 21,814,000 at September 30, 2023 and $ 32,628,000 at December 31, 2022. A lthough the Company believes that its estimated range of possible environmental losses and legal losses and its reserves are adequate for contingencies, it is possible, due to the uncertainties noted above, that additional reserves could be required in the future. Cash expenditures related to environmental remediation and certain other legal matters approximated $ 11,384,000 and $ 1,511,000 for the nine months ended September 30, 2023 and 2022, respectively. The majority of the increase in cash expenditures relates to remediation costs at the Company's Maywood, New Jersey site. For certain sites, the Company has responded to information requests made by federal, state or local government agencies but has received no response confirming or denying the Company’s stated positions. As such, estimates of the total costs, or range of possible costs, of remediation, if any, or the Company’s share of such costs, if any, cannot be determined with respect to these sites. Consequently, the Company is unable to predict the effect thereof on the Company’s financial position, cash flows and results of operations. Based on the Company’s present knowledge with respect to its involvement at these sites, the possibility of other viable entities’ responsibilities for cleanup, and the extended period over which any costs would be incurred, management believes that the Company has no material liability at these sites and that these matters, individually and in the aggregate, will not have a material effect on the Company’s financial position. However, in the event of one or more adverse determinations with respect to such sites in any annual or interim period, the effect on the Company’s cash flows and results of operations for those periods could be material. Following are summaries of the Company’s major contingencies at September 30, 2023: Maywood, New Jersey Site The Company’s property in Maywood, New Jersey, property formerly owned by the Company adjacent to its current property and other nearby properties (collectively, the Maywood site) were listed on the National Priorities List in September 1993 pursuant to the provisions of CERCLA because of alleged chemical and radiological contamination. Pursuant to (i) a September 21, 1987 Administrative Order on Consent entered into between the USEPA and the Company for property formerly owned by the Company at the Maywood site and (ii) the issuance of an order on May 2, 1991, by the USEPA to the Company for property currently owned by the Company at the Maywood site, the Company has completed various Remedial Investigation/Feasibility Studies of soils and groundwater at the Maywood site. On September 23, 2014, USEPA issued its Record of Decision for chemically-contaminated soil at the Maywood site, which requires the Company to perform remedial cleanup of the soil and buried waste. The USEPA has not yet issued a Record of Decision for chemically-contaminated groundwater at the Maywood site. Based on the most current information available, the Company believes its recorded liability is reasonable having considered the range of estimated costs of remediation for the Maywood site. The estimate of the cost of remediation for the Maywood site could change again as the Company continues to hold discussions with the USEPA, as the remedial action is finalized, if a groundwater Record of Decision is issued or if other PRPs are identified. The ultimate amount for which the Company is liable could differ materially from the Company’s current recorded liability. In April 2015, the Company entered into an Administrative Settlement Agreement and Administrative Order on Consent with USEPA which requires payment of certain costs and performance of certain investigative and design work for chemically-contaminated soil. In addition, under the terms of a settlement agreement reached on November 12, 2004, the U.S. Department of Justice and the Company agreed to fulfill the terms of a Cooperative Agreement reached in 1985. Under the Cooperative Agreement, the United States is responsible for the removal of radioactive waste at the Maywood site, including past and future remediation costs at the site. As such, the Company recorded no liability related to that settlement agreement. D’Imperio Property Site During the mid-1970’s, Jerome Lightman and the Lightman Drum Company disposed of hazardous substances generated by the Company at several sites in New Jersey, including the D’Imperio site. The Company was named as a PRP in an October 2, 1998, lawsuit in the U.S. District Court for the District of New Jersey that involved the D’Imperio Site. Remediation work continues at the D’Imperio site. Based on current information, the Company believes that its recorded liability is reasonable having considered the range of estimated cost of remediation for the D’Imperio site. Depending on the ultimate cost of the remediation at this site, the amount for which the Company is liable could differ materially from the Company’s current recorded liability. Wilmington Site Property formerly owned and operated by the Company in Wilmington, Massachusetts was listed on the National Priorities List in 2006. The Company, together with the current site owner and another potentially responsible party, entered into an Administrative Order on Consent in July 2007 to undertake a Remedial Investigation and Feasibility Study. A Record of Decision was issued by the USEPA on March 30, 2021. The Company and three other potentially responsible parties have entered into a consent decree, dated September 28, 2023, with USEPA and the Commonwealth of Massachusetts that requires the remedial design and remedial action of the remedy selected in the Record of Decision for two operable units and an interim remedy for another operable unit. Remediation at this site is being managed by its current owner, to whom the Company sold the property in 1980. The Company is contractually obligated to contribute up to five percent of the environmental response costs incurred by the current owner, with no limitation on the ultimate amount of contributions. The Company has paid the current owner $ 3,592,000 for the Company’s portion of environmental response costs at the Wilmington site through September 30, 2023. The Company has recorded a liability for its portion of the estimated remediation costs for the site. Depending on the ultimate cost of the remediation at this site, the amount for which the Company is liable could differ materially from the current recorded liability. On July 29, 2022, the Company and other potentially responsible parties were notified of a possible joint claim by federal and state trustees for alleged natural resource damages related to the Wilmington site. The alleged damages may result in a range of possible penalties and the Company believes it is probable that it will have exposure for this claim; however, at this stage, the Company is unable to predict the ultimate outcome of this claim, the allocation of costs among the potentially responsible parties or what impact, if any, the outcome might have on the Company’s results of operations or cash flows. The Company and other prior owners of the Wilmington site also entered into an agreement in April 2004 waiving certain statute of limitations defenses for claims which may be filed by the Town of Wilmington, Massachusetts, in connection with this site. While the Company has denied any liability for any such claims, the Company agreed to this waiver while the parties continue to discuss the resolution of any potential claim which may be filed. Other U.S. Sites Through the regular environmental monitoring of its plant production sites, the Company discovered levels of chemical contamination that were above thresholds allowed by law at its Elwood, Illinois (Millsdale) and Fieldsboro, New Jersey plants. The Company voluntarily reported its results to the applicable state environmental agencies. As a result, the Company is required to perform self-remediation of the affected areas. Based on current information, the Company believes that its recorded liability for the remediation of the affected areas is appropriate based on an estimate of expected costs. However, actual costs could differ materially from the current recorded liability. |
Postretirement Benefit Plans
Postretirement Benefit Plans | 9 Months Ended |
Sep. 30, 2023 | |
Retirement Benefits [Abstract] | |
Postretirement Benefit Plans | 9. POSTRETIREMENT BENEFIT PLANS Defined Benefit Pension Plans The Company sponsors various funded qualified and unfunded non-qualified defined benefit pension plans, the most significant of which cover employees in the U.S. and U.K. locations. The U.S. and U.K. defined benefit pension plans are frozen and service benefits are no longer being accrued. Components of Net Periodic Benefit Cost UNITED STATES (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Interest cost $ 1,731 $ 1,235 $ 5,193 $ 3,704 Expected return on plan assets ( 2,133 ) ( 2,201 ) ( 6,399 ) ( 6,602 ) Amortization of net actuarial loss ( 6 ) 577 ( 18 ) 1,731 Net periodic benefit cost $ ( 408 ) $ ( 389 ) $ ( 1,224 ) $ ( 1,167 ) UNITED KINGDOM (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Interest cost $ 171 $ 86 $ 504 $ 282 Expected return on plan assets ( 177 ) ( 93 ) ( 522 ) ( 300 ) Amortization of net actuarial loss 85 2 250 7 Net periodic benefit cost $ 79 $ ( 5 ) $ 232 $ ( 11 ) Employer Contributions U.S. Plans As a result of pension funding relief provisions included in the Highway and Transportation Funding Act of 2014, the Company is not required to make contributions to its funded U.S. qualified defined benefit plans. Approximately $ 256,000 is expected to be paid to the unfunded non-qualified plans in 2023 . Of such amount, $ 209,000 had been paid to the non-qualified plans as of September 30, 2023. U.K. Plan The Company’s U.K. subsidiary expects to contribute approximately $ 451,000 to its defined benefit pension plan in 2023 . Of such amount, $ 360,000 had been contributed to the plan as of September 30, 2023. Defined Contribution Plans The Company sponsors retirement defined contribution plans that cover eligible U.S. and U.K. employees. The Company’s U.S. retirement plans include two qualified plans, one of which is a 401(k) plan and one of which is an employee stock ownership plan (profit sharing plan), and one non-qualified supplemental executive plan. In the nine months ended September 30, 2023 and 2022 , the Company made contributions into the qualified retirement plans for U.S. employees and for certain non-U.S. employees. Profit sharing contributions were determined using a formula applied to Company earnings. Approximately 85 percent of union and non-union employees are eligible for either the Company's sponsored or statutory profit sharing contributions and 100 percent of U.S. based union and non-union employees are eligible for the Company's sponsored profit sharing contributions. In 2022 and 2023, profit sharing contributions for U.S. employees were made to the employee stock ownership plan. Profit sharing contributions are allocated to participant accounts based on participant base earnings. Defined contribution plan expenses for the Company’s qualified contribution plans were as follows: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Retirement savings contributions $ 2,101 $ 1,897 $ 6,319 $ 6,042 Profit sharing contributions 673 1,859 1,543 5,284 Total defined contribution plan expenses $ 2,774 $ 3,756 $ 7,862 $ 11,326 The Company has a rabbi trust to fund the obligations of its non-qualified supplemental executive defined contribution plans (supplemental plans). The trust is comprised of various mutual fund investments selected by the participants of the supplemental plans. In accordance with the accounting guidance for rabbi trust arrangements, the assets of the trust and the obligations of the supplemental plans are reported on the Company’s condensed consolidated balance sheets. The Company elected the fair value option for the mutual fund investment assets so that offsetting changes in the mutual fund values and defined contribution plan obligations would be recorded in earnings in the same period. Therefore, the mutual funds are reported at fair value with any subsequent changes in fair value recorded in the condensed consolidated statements of income. The liabilities related to the supplemental plans increase (i.e., supplemental plan expense is recognized) when the value of the trust assets appreciate and decrease when the value of the trust assets decline (i.e., supplemental plan income is recognized). At September 30, 2023 , the balance of the trust assets was $ 409,000 , which equaled the balance of the supplemental plan liabilities. See the long-term investments section in Note 3, Fair Value Measurements , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q) for further information regarding the Company’s mutual fund assets. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 10. EARNINGS PER SHARE Below are the computations of basic and diluted earnings per share for the three and nine months ended September 30, 2023 and 2022: (In thousands, except per share amounts) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Computation of Basic Earnings per Share Net income attributable to Stepan Company $ 12,571 $ 39,384 $ 41,397 $ 136,319 Weighted-average number of common shares 22,786 22,753 22,770 22,813 Basic earnings per share $ 0.55 $ 1.73 $ 1.82 $ 5.98 Computation of Diluted Earnings per Share Net income attributable to Stepan Company $ 12,571 $ 39,384 $ 41,397 $ 136,319 Weighted-average number of shares outstanding 22,786 22,753 22,770 22,813 Add weighted-average net shares from assumed (1) 54 102 75 105 Add weighted-average net shares related to unvested 3 2 2 1 Add weighted-average net shares from assumed (1) 53 108 78 111 Add weighted-average contingently issuable net 34 69 31 59 Weighted-average shares applicable to diluted 22,930 23,034 22,956 23,089 Diluted earnings per share $ 0.55 $ 1.71 $ 1.80 $ 5.90 (1) 822,271 and 623,648 options/SARs to acquire shares of the Company's common stock were excluded from the computation of dilutive earnings per share for the three and nine months ended September 30, 2023 , respectively. The options/SARs' exercise prices were greater than the average market price for the Company's common stock and inclusion of the instruments would have had an antidilutive effect on the computations of the earnings per share. 336,727 and 346,044 options/SARs to acquire shares of the Company's common stock were excluded from the computation of dilutive earnings per share for the three and nine months ended September 30, 2022 , respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | 11. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Below is the change in the Company’s accumulated other comprehensive income (loss) (AOCI) balance by component (net of income taxes) for the three and nine months ended September 30, 2023 and 2022: (In thousands) Foreign Defined Cash Flow Total Balance at June 30, 2022 $ ( 161,535 ) $ ( 17,152 ) $ 4,885 $ ( 173,802 ) Other comprehensive income before ( 30,002 ) — 3,998 ( 26,004 ) Amounts reclassified from AOCI — 435 ( 2 ) 433 Net current-period other comprehensive income ( 30,002 ) 435 3,996 ( 25,571 ) Balance at September 30, 2022 $ ( 191,537 ) $ ( 16,717 ) $ 8,881 $ ( 199,373 ) Balance at June 30, 2023 $ ( 121,915 ) $ ( 18,961 ) $ 8,506 $ ( 132,370 ) Other comprehensive income before ( 19,578 ) — 564 ( 19,014 ) Amounts reclassified from AOCI — 61 ( 2 ) 59 Net current-period other comprehensive income ( 19,578 ) 61 562 ( 18,955 ) Balance at September 30, 2023 $ ( 141,493 ) $ ( 18,900 ) $ 9,068 $ ( 151,325 ) Balance at December 31, 2021 $ ( 135,268 ) $ ( 18,022 ) $ 54 $ ( 153,236 ) Other comprehensive income before ( 56,269 ) — 8,834 ( 47,435 ) Amounts reclassified from AOCI — 1,305 ( 7 ) 1,298 Net current-period other comprehensive income ( 56,269 ) 1,305 8,827 ( 46,137 ) Balance at September 30, 2022 $ ( 191,537 ) $ ( 16,717 ) $ 8,881 $ ( 199,373 ) Balance at December 31, 2022 $ ( 156,835 ) $ ( 19,079 ) $ 8,402 $ ( 167,512 ) Other comprehensive income before 15,342 — 673 16,015 Amounts reclassified from AOCI — 179 ( 7 ) 172 Net current-period other comprehensive income 15,342 179 666 16,187 Balance at September 30, 2023 $ ( 141,493 ) $ ( 18,900 ) $ 9,068 $ ( 151,325 ) Information regarding the reclassifications out of AOCI for the three and nine months ended September 30, 2023 and 2022, is displayed below: (In thousands) Amount Reclassified from AOCI (1) AOCI Components Three Months Ended Nine Months Ended Affected Line Item in 2023 2022 2023 2022 Amortization of defined benefit $ ( 79 ) $ ( 579 ) $ ( 232 ) $ ( 1,738 ) (2) 18 144 53 433 Tax benefit $ ( 61 ) $ ( 435 ) $ ( 179 ) $ ( 1,305 ) Net of tax Gains and losses on cash flow Foreign exchange contracts 2 2 7 7 Cost of sales 2 2 7 7 Total before tax — — — — Tax benefit $ 2 $ 2 $ 7 $ 7 Net of tax Total reclassifications for the period $ ( 59 ) $ ( 433 ) $ ( 172 ) $ ( 1,298 ) Net of tax (1) A mounts in parentheses denote expense to the Company’s Condensed Consolidated Statements of Income. (2) This component of accumulated other comprehensive income is included in the computation of net periodic benefit cost. See Note 9, Postretirement Benefit Plans , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q) for additional details. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment Reporting | 12. SEGMENT REPORTING The Company has three reportable segments: Surfactants, Polymers and Specialty Products. Net sales by segment for the three and nine months ended September 30, 2023 and 2022, were as follows: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Segment Net Sales Surfactants $ 373,836 $ 474,861 $ 1,233,351 $ 1,428,211 Polymers 169,559 214,807 495,200 640,771 Specialty Products 18,831 29,517 65,086 77,112 Total $ 562,226 $ 719,185 $ 1,793,637 $ 2,146,094 Segment operating income and reconciliations of segment operating income to income before provision for income taxes for the three and nine months ended September 30, 2023 and 2022, are summarized below: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Segment Operating Income Surfactants $ 15,373 $ 38,976 $ 57,570 $ 140,994 Polymers 21,813 31,864 48,137 79,905 Specialty Products 2,402 9,685 8,704 23,246 Segment operating income 39,588 80,525 114,411 244,145 Business restructuring ( 5,628 ) ( 92 ) ( 5,827 ) ( 225 ) Unallocated corporate expenses (1) ( 14,443 ) ( 25,774 ) ( 50,201 ) ( 48,275 ) Total operating income 19,517 54,659 58,383 195,645 Other Income (Expense) Interest, net ( 2,987 ) ( 2,221 ) ( 9,674 ) ( 7,254 ) Other, net ( 690 ) ( 1,980 ) 3,348 ( 8,999 ) Income before provision for income taxes $ 15,840 $ 50,458 $ 52,057 $ 179,392 (1) Unallocated corporate expenses are primarily comprised of corporate administrative expenses (e.g., corporate finance, legal, human resources, information systems, deferred compensation and environmental remediation) that are not included in segment operating income and are not used to evaluate segment performance. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | 13. REVENUE FROM CONTRACTS WITH CUSTOMERS As of September 30, 2023 , the Company had $ 478,000 of contract liabilities and no contract assets. A contract liability would typically arise when an advance or deposit is received from a customer before the Company recognizes revenue. In practice, this is rare as it would require a customer to make a payment prior to a performance obligation being satisfied. When such situations do arise, the Company maintains a deferred revenue liability until the time a performance obligation has been satisfied. The Company recognized $ 739,000 of revenue in the first nine months of 2023 from pre-existing contract liabilities at December 31, 2022 . During 2020, the Company recorded $ 10,709,000 of long-term deferred revenue associated with a payment received to defray the cost of capital expenditures necessary to service a customer’s future product needs. At September 30, 2023 , $ 7,201,000 was classified as long-term and $ 2,216,000 was classified as short-term. This deferred revenue is being recognized over the period of the contract and $ 1,292,000 of revenue has been recognized from this contract as of September 30, 2023. The tables below provide a geographic disaggregation of net sales for the three and nine months ended September 30, 2023 and 2022. The Company’s business disaggregation by geographic region most effectively captures the nature and economic characteristics of the Company’s revenue streams impacted by economic factors. (In thousands) For the Three Months Ended September 30, 2023 Geographic Market Surfactants Polymers Specialty Total North America $ 223,912 $ 90,521 $ 15,455 $ 329,888 Europe 60,126 66,752 3,268 130,146 Latin America 76,469 412 108 76,989 Asia 13,329 11,874 — 25,203 Total $ 373,836 $ 169,559 $ 18,831 $ 562,226 (In thousands) For the Three Months Ended September 30, 2022 Geographic Market Surfactants Polymers Specialty Total North America $ 272,557 $ 128,992 $ 24,370 $ 425,919 Europe 86,344 76,022 4,814 167,180 Latin America 98,313 1,081 333 99,727 Asia 17,647 8,712 — 26,359 Total $ 474,861 $ 214,807 $ 29,517 $ 719,185 (In thousands) For the Nine Months Ended September 30, 2023 Geographic Market Surfactants Polymers Specialty Total North America $ 732,530 $ 259,839 $ 53,552 $ 1,045,921 Europe 219,988 201,705 11,314 433,007 Latin America 235,784 1,470 220 237,474 Asia 45,049 32,186 — 77,235 Total $ 1,233,351 $ 495,200 $ 65,086 $ 1,793,637 (In thousands) For the Nine Months Ended September 30, 2022 Geographic Market Surfactants Polymers Specialty Total North America $ 824,095 $ 357,303 $ 64,050 $ 1,245,448 Europe 269,952 251,229 12,067 533,248 Latin America 281,734 3,450 995 286,179 Asia 52,430 28,789 — 81,219 Total $ 1,428,211 $ 640,771 $ 77,112 $ 2,146,094 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | 14. DEBT At September 30, 2023 and December 31, 2022, debt was comprised of the following: (In thousands) Maturity September 30, December 31, Senior unsecured notes 3.95 % (net of unamortized debt issuance cost 215 and $ 186 for 2023 and 2022, respectively) 2023 - 2027 $ 56,928 $ 71,243 3.86 % (net of unamortized debt issuance cost 125 and $ 125 for 2023 and 2022, respectively) 2023 - 2025 28,446 42,732 4.86 % (net of unamortized debt issuance cost 0 and $ 30 for 2023 and 2022, respectively) 2023 9,286 9,260 2.30 % (net of unamortized debt issuance cost 159 and $ 122 for 2023 and 2022, respectively) 2024 - 2028 49,841 49,878 2.37 % (net of unamortized debt issuance cost 165 and $ 128 for 2023 and 2022, respectively) 2024 - 2028 49,835 49,872 2.73 % (net of unamortized debt issuance cost 201 and $ 55 for 2023 and 2022, respectively) 2025 - 2031 99,799 99,945 2.83 % (net of unamortized debt issuance cost 152 and $ 40 for 2023 and 2022, respectively) 2026 - 2032 74,848 74,960 Revolving credit facility and term loan borrowing 2023 - 2027 274,000 189,250 Debt of foreign subsidiaries Unsecured bank debt, foreign currency 2023 6,406 - Total debt $ 649,389 $ 587,140 Less current maturities 227,014 132,111 Long-term debt $ 422,375 $ 455,029 The Company's long-term debt financing is currently comprised of certain senior unsecured notes issued to insurance companies in private placement transactions pursuant to note purchase agreements (the “Note Purchase Agreements”), totaling $ 368,983,000 as of September 30, 2023 . These notes are denominated in U.S. dollars and have fixed interest rates ranging from 2.30 percent to 4.86 percent. The notes had original maturities of seven to 12 years with mandatory principal payments beginning four, five and six years after issuance . The Company will be required to make principal payments on the currently outstanding notes from 2023 to 2032. On September 29, 2023, the Company entered into amendments to the Note Purchase Agreements (the “NPA Amendments”) to primarily provide additional covenant flexibility. The NPA Amendments, among other things, (i) amended the existing maximum net leverage ratios covenant; (ii) expanded the definition of “Qualified Cash”, a metric used to calculate the net leverage ratio, to include 65 percent of unrestricted and unencumbered foreign-based cash or permitted investments; and (iii) included a debt rating requirement and, to the extent the relevant notes are rated below investment grade, a rating fee of 0.75 percent per annum. The Company's credit agreement (the "Credit Agreement") with a syndicate of banks provides for credit facilities in an initial aggregate principal amount of $ 450,000,000 , consisting of (a) a $ 350,000,000 multi-currency revolving credit facility and (b) a $ 100,000,000 delayed draw term loan credit facility, each of which matures on June 24, 2027 . The Company maintains import letters of credit, and standby letters of credit under its workers’ compensation insurance agreements and for other purposes, as needed from time to time, which are issued under the revolving credit agreement. As of September 30, 2023 , the Company had outstanding letters of credit totaling $ 10,951,000 and $ 274,000,000 of outstanding borrowings under the credit agreement, inclusive of a $ 96,250,000 delayed draw term loan ($ 3,750,000 of the term loan principal has been permanently repaid as scheduled). There was $ 161,299,000 available under the credit agreement as of September 30, 2023. On September 29, 2023, the Company entered into an amendment (the “Amendment”) to the Credit Agreement. The Amendment amends the Credit Agreement to, among other things, (i) provide for a maximum net leverage ratio on substantially the same terms as the corresponding covenant contained in the NPA Amendments; and (ii) expand the definition of “Qualified Cash,” to align with the definition of “Qualified Cash” included in the NPA Amendments. The Company’s material debt agreements contain provisions which, among other covenants, require maintenance of certain financial ratios and place limitations on additional debt, investments and payment of dividends. Based on the loan agreement provisions that place limitations on dividend payments, unrestricted retained earnings (i.e., retained earnings available for dividend distribution) were $ 243,493,000 and $ 224,189,000 at September 30, 2023 and December 31, 2022 , respectively. |
Other, Net
Other, Net | 9 Months Ended |
Sep. 30, 2023 | |
Other Income and Expenses [Abstract] | |
Other, Net | 15. OTHER, NET Other, net in the condensed consolidated statements of income included the following: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Foreign exchange gains (losses) $ ( 623 ) $ ( 1,387 ) $ ( 541 ) $ ( 2,612 ) Investment income 85 114 299 508 Realized and unrealized gains (losses) on investments ( 481 ) ( 1,101 ) 2,598 ( 8,073 ) Net periodic benefit cost 329 394 992 1,178 Other, net $ ( 690 ) $ ( 1,980 ) $ 3,348 $ ( 8,999 ) |
Goodwill Impairment
Goodwill Impairment | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill Impairment | 16. GOODWILL IMPAIRMENT The Company typically tests its goodwill balances for impairment in the second quarter of each calendar year. Testing is completed more frequently when triggering events or changes in circumstances indicate it is more likely than not that the fair value of a reporting unit to which goodwill relates has declined below its carrying value. During the second quarter of 2023 the Company completed its annual goodwill impairment testing and concluded that there was no goodwill impairment at any of its reporting units. During the second quarter of 2022 the Company completed its annual goodwill impairment testing and concluded that the goodwill related to its Philippines reporting unit was impaired. The Philippines reporting unit is part of the Company’s Surfactants segment. Goodwill impairment was recognized as a result of the reporting unit’s fair value declining below its carrying value. The Company estimates the fair value of each of its reporting units based on the average of market and income-based computations. The Philippines impairment primarily resulted from lost market share at one major customer combined with higher unit overhead costs. The Company recorded a non-cash charge of $ 978,000 in the Condensed Consolidated Statements of Income for the nine months ended September 30, 2022. The impairment charge equaled the entire balance of the Philippines’ goodwill. |
Noncash Investing and Financing
Noncash Investing and Financing Activities | 9 Months Ended |
Sep. 30, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Noncash Investing and Financing Activities | 17. NONCASH INVESTING AND FINANCING ACTIVITIES Noncash investing activities included liabilities (accounts payable) incurred for property, plant and equipment expenditures of approximately $ 15,715,000 and $ 44,833,000 that were unpaid at September 30, 2023 and 2022 , respectively. Noncash financing activities included the issuance of 97,774 shares of the Company’s common stock (valued at $ 10,480,000 ) and 58,441 shares of the Company’s common stock (valued at $ 6,095,000 ) under the Company’s equity incentive compensation plan during the nine months ended September 30, 2023 and 2022 , respectively. |
Business Restructuring
Business Restructuring | 9 Months Ended |
Sep. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Business Restructuring | 18. BUSINESS RESTRUCTURING 2023 Restructuring During the third quarter of 2023 the Company recorded a $ 5,530,000 restructuring expense associated with the Company's previously announced voluntary early retirement program. The program was offered to eligible employees at the Company's corporate headquarters and global technology center to reduce costs. The remainder of the business restructuring expenses incurred during the three and nine months ended September 30, 2023, were not material, and relate to decommissioning expenses associated with the Company's 2016 Canadian plant closure. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | 19. RECENT ACCOUNTING PRONOUNCEMENTS In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848) Facilitation of the Effect of Reference Rate Reform on Financial Reporting. This update provides optional guidance for a limited period of time to ease the burden of implementing the usage of new reference rates. The amendments apply to contract modifications that replace a reference rate affected by reference rate reform and contemporaneous modifications of other contract terms related to the replacement of the reference rate. If elected, the optional expedients to contract modifications must be applied consistently for all eligible contracts or eligible transactions. The original timeframe for electing optional expedients to contract modifications was between March 12, 2020 and December 31, 2022. In December 2022, the FASB issued ASU No. 2022-06 deferring the sunset date of Topic 848 from December 31, 2022, to December 31, 2024. The guidance should be applied prospectively. Other than electing select expedients associated with an interest rate swap, the Company has not currently utilized any of the optional expedients of exceptions available under this ASU. The Company will continue to assess whether this ASU is applicable throughout the effective period. |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848) Facilitation of the Effect of Reference Rate Reform on Financial Reporting. This update provides optional guidance for a limited period of time to ease the burden of implementing the usage of new reference rates. The amendments apply to contract modifications that replace a reference rate affected by reference rate reform and contemporaneous modifications of other contract terms related to the replacement of the reference rate. If elected, the optional expedients to contract modifications must be applied consistently for all eligible contracts or eligible transactions. The original timeframe for electing optional expedients to contract modifications was between March 12, 2020 and December 31, 2022. In December 2022, the FASB issued ASU No. 2022-06 deferring the sunset date of Topic 848 from December 31, 2022, to December 31, 2024. The guidance should be applied prospectively. Other than electing select expedients associated with an interest rate swap, the Company has not currently utilized any of the optional expedients of exceptions available under this ASU. The Company will continue to assess whether this ASU is applicable throughout the effective period. |
Reconciliations of Equity (Tabl
Reconciliations of Equity (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Reconciliations of Total Equity | Below are reconciliations of total equity for the three and nine months ended September 30, 2023 and 2022: (In thousands, except share and per share amounts) Total Common Additional Common Accumulated Retained Balance, June 30, 2023 $ 1,215,097 $ 26,978 $ 242,215 $ ( 184,365 ) $ ( 132,370 ) $ 1,262,639 Issuance of 10,730 shares of 470 11 459 — — — Stock-based and deferred compensation 1,750 — 1,757 ( 7 ) — — Net income 12,571 — — — — 12,571 Other comprehensive income ( 18,955 ) — — — ( 18,955 ) — Cash dividends paid: Common stock ($ 0.365 per share) ( 8,162 ) — — — — ( 8,162 ) Balance, September 30, 2023 $ 1,202,771 $ 26,989 $ 244,431 $ ( 184,372 ) $ ( 151,325 ) $ 1,267,048 (In thousands, except share and per share amounts) Total Common Additional Common Accumulated Retained Balance, December 31, 2022 $ 1,166,065 $ 26,841 $ 237,202 $ ( 180,596 ) $ ( 167,512 ) $ 1,250,130 Issuance of 43,502 shares of 2,386 44 2,342 — — — Stock-based and deferred compensation 1,215 104 4,887 ( 3,776 ) — — Net income 41,397 — — — — 41,397 Other comprehensive income 16,187 — — — 16,187 — Cash dividends paid: Common stock ($ 1.095 per share) ( 24,479 ) — — — — ( 24,479 ) Balance, September 30, 2023 $ 1,202,771 $ 26,989 $ 244,431 $ ( 184,372 ) $ ( 151,325 ) $ 1,267,048 (In thousands, except share and per share amounts) Total Common Additional Common Accumulated Retained Balance, June 30, 2022 $ 1,125,711 $ 26,825 $ 229,510 $ ( 172,322 ) $ ( 173,802 ) $ 1,215,500 Issuance of 2,734 shares of 169 3 166 — — — Purchase of 54,780 shares of ( 5,281 ) — — ( 5,281 ) — — Stock-based and deferred compensation 3,300 1 3,360 ( 61 ) — — Net income 39,384 — — — — 39,384 Other comprehensive income (loss) ( 25,571 ) — — — ( 25,571 ) — Cash dividends paid: Common stock ($ 0.335 per share) ( 7,473 ) — — — — ( 7,473 ) Balance, September 30, 2022 $ 1,130,239 $ 26,829 $ 233,036 $ ( 177,664 ) $ ( 199,373 ) $ 1,247,411 (In thousands, except share and per share amounts) Total Common Additional Common Accumulated Retained Balance, December 31, 2021 $ 1,074,193 $ 26,761 $ 220,820 $ ( 153,702 ) $ ( 153,236 ) $ 1,133,550 Issuance of 5,381 shares of 353 5 348 — — — Purchase of 222,720 shares of ( 22,257 ) — — ( 22,257 ) — — Stock-based and deferred compensation 10,226 63 11,868 ( 1,705 ) — — Net income 136,319 — — — — 136,319 Other comprehensive income (loss) ( 46,137 ) — — — ( 46,137 ) — Cash dividends paid: Common stock ($ 1.005 per share) ( 22,458 ) — — — — ( 22,458 ) Balance, September 30, 2022 $ 1,130,239 $ 26,829 $ 233,036 $ ( 177,664 ) $ ( 199,373 ) $ 1,247,411 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Values and Related Carrying Values of Debt | At September 30, 2023, and December 31, 2022 , the fair values and related carrying values of debt, including current maturities, were as follows (the fair value and carrying value amounts are presented without regard to unamortized debt issuance costs of $ 1,017,000 and $ 686,000 as of September 30, 2023 and December 31, 2022, respectively): (In thousands) September 30, December 31, Fair value $ 604,979 $ 541,029 Carrying value 650,406 587,826 |
Financial Assets and Liabilities, Excluding Cash and Cash Equivalents, Measured on a Recurring Basis at Fair Value | The following tables present financial assets and liabilities, excluding cash and cash equivalents, measured on a recurring basis at fair value as of September 30, 2023, and December 31, 2022, and the level within the fair value hierarchy in which the fair value measurements fall: (In thousands) September 30, Level 1 Level 2 Level 3 Mutual fund assets $ 24,528 $ 24,528 $ — $ — Derivative assets: Interest rate contracts 9,030 — 9,030 — Foreign currency contracts 1,690 — 1,690 — Total assets at fair value $ 35,248 $ 24,528 $ 10,720 $ — Derivative liabilities: Foreign currency contracts $ 2,031 $ — $ 2,031 $ — (In thousands) December 31, Level 1 Level 2 Level 3 Mutual fund assets $ 23,294 $ 23,294 $ — $ — Derivative assets: Interest rate contracts 8,357 — 8,357 — Foreign currency contracts 513 — 513 — Total assets at fair value $ 32,164 $ 23,294 $ 8,870 $ — Derivative liabilities: Foreign currency contracts $ 525 $ — $ 525 $ — |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Compensation Expense Recorded for All Stock Options, Stock Awards and Stock Appreciation Rights (SARs) | Compensation expense recorded for all stock options, performance shares, time-based restricted stock units (RSUs) and stock appreciation rights (SARs) was as follows: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 $ 1,520 $ 3,057 $ 3,677 $ 10,012 |
Unrecognized Compensation Costs for Stock Options, Stock Awards and SARs | Unrecognized compensation costs for stock options, performance shares, RSUs and SARs were as follows: (In thousands) September 30, December 31, Stock options $ 283 $ 692 Performance shares and RSUs 4,658 6,144 SARs 4,677 5,211 |
Share Based Payment Awards Granted in Period | The change in unrecognized compensation costs reflects the 2023 grants of stock options, performance shares, RSUs and SARs and Company management lowering its assessment of the achievement of performance targets for certain grants. The Company granted the following awards in the first nine months of 2023: Shares Stock options 2,777 Performance shares (at target) and RSUs 87,025 SARs 77,006 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Composition of Inventories | The composition of inventories at September 30, 2023, and December 31, 2022, was as follows: (In thousands) September 30, 2023 December 31, 2022 Finished goods $ 186,788 $ 250,373 Raw materials 97,758 152,158 Total inventories $ 284,546 $ 402,531 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Schedule of Lease Cost Recognized in both Cost of Sale and Operating Expenses | Lease cost is recognized in both the Cost of Sales and Operating Expenses sections of the Condensed Consolidated Statements of Income. (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Lease Cost Operating lease cost $ 4,448 $ 3,917 $ 13,255 $ 11,968 Short-term lease cost 2,697 1,887 8,215 4,587 Variable lease cost 674 205 1,834 630 Total lease cost $ 7,819 $ 6,009 $ 23,304 $ 17,185 Other Information Cash paid for amounts included in the Operating cash flow from operating $ 4,447 $ 3,903 $ 13,276 $ 11,908 Right-of-use assets obtained in exchange 916 455 8,336 4,017 |
Schedule of Maturities of Lease Liabilities | The following table outlines the maturities of lease liabilities as of September 30, 2023. (In thousands) Undiscounted Cash Flows: 2023 (excluding the nine months ended September 30, 2023) $ 4,310 2024 13,549 2025 9,346 2026 6,976 2027 6,270 Subsequent to 2027 38,179 Total Undiscounted Cash Flows $ 78,630 Less: Imputed interest ( 12,190 ) Present value $ 66,440 Current operating lease liabilities (1) 12,787 Non-current operating lease liabilities 53,653 Total lease liabilities $ 66,440 (1) This item is included in the Accrued liabilities line on the Company’s Condensed Consolidated Balance Sheet. |
Schedule of Operating Leases Weighted Average, Remaining Lease Term and Discount Rate | Weighted-average remaining lease term-operating leases 9 Years Weighted-average discount rate-operating leases 3.6 % |
Postretirement Benefit Plans (T
Postretirement Benefit Plans (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Retirement Benefits [Abstract] | |
Components of Net Periodic Benefit Cost | Components of Net Periodic Benefit Cost UNITED STATES (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Interest cost $ 1,731 $ 1,235 $ 5,193 $ 3,704 Expected return on plan assets ( 2,133 ) ( 2,201 ) ( 6,399 ) ( 6,602 ) Amortization of net actuarial loss ( 6 ) 577 ( 18 ) 1,731 Net periodic benefit cost $ ( 408 ) $ ( 389 ) $ ( 1,224 ) $ ( 1,167 ) UNITED KINGDOM (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Interest cost $ 171 $ 86 $ 504 $ 282 Expected return on plan assets ( 177 ) ( 93 ) ( 522 ) ( 300 ) Amortization of net actuarial loss 85 2 250 7 Net periodic benefit cost $ 79 $ ( 5 ) $ 232 $ ( 11 ) |
Defined Contribution Plan Expenses for Company's Qualified Contribution Plans | Defined contribution plan expenses for the Company’s qualified contribution plans were as follows: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Retirement savings contributions $ 2,101 $ 1,897 $ 6,319 $ 6,042 Profit sharing contributions 673 1,859 1,543 5,284 Total defined contribution plan expenses $ 2,774 $ 3,756 $ 7,862 $ 11,326 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Computations of Basic and Diluted Earnings Per Share | Below are the computations of basic and diluted earnings per share for the three and nine months ended September 30, 2023 and 2022: (In thousands, except per share amounts) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Computation of Basic Earnings per Share Net income attributable to Stepan Company $ 12,571 $ 39,384 $ 41,397 $ 136,319 Weighted-average number of common shares 22,786 22,753 22,770 22,813 Basic earnings per share $ 0.55 $ 1.73 $ 1.82 $ 5.98 Computation of Diluted Earnings per Share Net income attributable to Stepan Company $ 12,571 $ 39,384 $ 41,397 $ 136,319 Weighted-average number of shares outstanding 22,786 22,753 22,770 22,813 Add weighted-average net shares from assumed (1) 54 102 75 105 Add weighted-average net shares related to unvested 3 2 2 1 Add weighted-average net shares from assumed (1) 53 108 78 111 Add weighted-average contingently issuable net 34 69 31 59 Weighted-average shares applicable to diluted 22,930 23,034 22,956 23,089 Diluted earnings per share $ 0.55 $ 1.71 $ 1.80 $ 5.90 (1) 822,271 and 623,648 options/SARs to acquire shares of the Company's common stock were excluded from the computation of dilutive earnings per share for the three and nine months ended September 30, 2023 , respectively. The options/SARs' exercise prices were greater than the average market price for the Company's common stock and inclusion of the instruments would have had an antidilutive effect on the computations of the earnings per share. 336,727 and 346,044 options/SARs to acquire shares of the Company's common stock were excluded from the computation of dilutive earnings per share for the three and nine months ended September 30, 2022 , respectively. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Summary of Changes in Accumulated Other Comprehensive Income (Loss) | Below is the change in the Company’s accumulated other comprehensive income (loss) (AOCI) balance by component (net of income taxes) for the three and nine months ended September 30, 2023 and 2022: (In thousands) Foreign Defined Cash Flow Total Balance at June 30, 2022 $ ( 161,535 ) $ ( 17,152 ) $ 4,885 $ ( 173,802 ) Other comprehensive income before ( 30,002 ) — 3,998 ( 26,004 ) Amounts reclassified from AOCI — 435 ( 2 ) 433 Net current-period other comprehensive income ( 30,002 ) 435 3,996 ( 25,571 ) Balance at September 30, 2022 $ ( 191,537 ) $ ( 16,717 ) $ 8,881 $ ( 199,373 ) Balance at June 30, 2023 $ ( 121,915 ) $ ( 18,961 ) $ 8,506 $ ( 132,370 ) Other comprehensive income before ( 19,578 ) — 564 ( 19,014 ) Amounts reclassified from AOCI — 61 ( 2 ) 59 Net current-period other comprehensive income ( 19,578 ) 61 562 ( 18,955 ) Balance at September 30, 2023 $ ( 141,493 ) $ ( 18,900 ) $ 9,068 $ ( 151,325 ) Balance at December 31, 2021 $ ( 135,268 ) $ ( 18,022 ) $ 54 $ ( 153,236 ) Other comprehensive income before ( 56,269 ) — 8,834 ( 47,435 ) Amounts reclassified from AOCI — 1,305 ( 7 ) 1,298 Net current-period other comprehensive income ( 56,269 ) 1,305 8,827 ( 46,137 ) Balance at September 30, 2022 $ ( 191,537 ) $ ( 16,717 ) $ 8,881 $ ( 199,373 ) Balance at December 31, 2022 $ ( 156,835 ) $ ( 19,079 ) $ 8,402 $ ( 167,512 ) Other comprehensive income before 15,342 — 673 16,015 Amounts reclassified from AOCI — 179 ( 7 ) 172 Net current-period other comprehensive income 15,342 179 666 16,187 Balance at September 30, 2023 $ ( 141,493 ) $ ( 18,900 ) $ 9,068 $ ( 151,325 ) |
Summary of Amounts Reclassifications Out of Accumulated Other Comprehensive Income | Information regarding the reclassifications out of AOCI for the three and nine months ended September 30, 2023 and 2022, is displayed below: (In thousands) Amount Reclassified from AOCI (1) AOCI Components Three Months Ended Nine Months Ended Affected Line Item in 2023 2022 2023 2022 Amortization of defined benefit $ ( 79 ) $ ( 579 ) $ ( 232 ) $ ( 1,738 ) (2) 18 144 53 433 Tax benefit $ ( 61 ) $ ( 435 ) $ ( 179 ) $ ( 1,305 ) Net of tax Gains and losses on cash flow Foreign exchange contracts 2 2 7 7 Cost of sales 2 2 7 7 Total before tax — — — — Tax benefit $ 2 $ 2 $ 7 $ 7 Net of tax Total reclassifications for the period $ ( 59 ) $ ( 433 ) $ ( 172 ) $ ( 1,298 ) Net of tax (1) A mounts in parentheses denote expense to the Company’s Condensed Consolidated Statements of Income. (2) This component of accumulated other comprehensive income is included in the computation of net periodic benefit cost. See Note 9, Postretirement Benefit Plans , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q) for additional details. |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Operating Segment | The Company has three reportable segments: Surfactants, Polymers and Specialty Products. Net sales by segment for the three and nine months ended September 30, 2023 and 2022, were as follows: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Segment Net Sales Surfactants $ 373,836 $ 474,861 $ 1,233,351 $ 1,428,211 Polymers 169,559 214,807 495,200 640,771 Specialty Products 18,831 29,517 65,086 77,112 Total $ 562,226 $ 719,185 $ 1,793,637 $ 2,146,094 |
Reconciliation of Segment Information to Income Before Provision for Income Taxes | Segment operating income and reconciliations of segment operating income to income before provision for income taxes for the three and nine months ended September 30, 2023 and 2022, are summarized below: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Segment Operating Income Surfactants $ 15,373 $ 38,976 $ 57,570 $ 140,994 Polymers 21,813 31,864 48,137 79,905 Specialty Products 2,402 9,685 8,704 23,246 Segment operating income 39,588 80,525 114,411 244,145 Business restructuring ( 5,628 ) ( 92 ) ( 5,827 ) ( 225 ) Unallocated corporate expenses (1) ( 14,443 ) ( 25,774 ) ( 50,201 ) ( 48,275 ) Total operating income 19,517 54,659 58,383 195,645 Other Income (Expense) Interest, net ( 2,987 ) ( 2,221 ) ( 9,674 ) ( 7,254 ) Other, net ( 690 ) ( 1,980 ) 3,348 ( 8,999 ) Income before provision for income taxes $ 15,840 $ 50,458 $ 52,057 $ 179,392 (1) Unallocated corporate expenses are primarily comprised of corporate administrative expenses (e.g., corporate finance, legal, human resources, information systems, deferred compensation and environmental remediation) that are not included in segment operating income and are not used to evaluate segment performance. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Geographic Disaggregation of Net Sales | The tables below provide a geographic disaggregation of net sales for the three and nine months ended September 30, 2023 and 2022. The Company’s business disaggregation by geographic region most effectively captures the nature and economic characteristics of the Company’s revenue streams impacted by economic factors. (In thousands) For the Three Months Ended September 30, 2023 Geographic Market Surfactants Polymers Specialty Total North America $ 223,912 $ 90,521 $ 15,455 $ 329,888 Europe 60,126 66,752 3,268 130,146 Latin America 76,469 412 108 76,989 Asia 13,329 11,874 — 25,203 Total $ 373,836 $ 169,559 $ 18,831 $ 562,226 (In thousands) For the Three Months Ended September 30, 2022 Geographic Market Surfactants Polymers Specialty Total North America $ 272,557 $ 128,992 $ 24,370 $ 425,919 Europe 86,344 76,022 4,814 167,180 Latin America 98,313 1,081 333 99,727 Asia 17,647 8,712 — 26,359 Total $ 474,861 $ 214,807 $ 29,517 $ 719,185 (In thousands) For the Nine Months Ended September 30, 2023 Geographic Market Surfactants Polymers Specialty Total North America $ 732,530 $ 259,839 $ 53,552 $ 1,045,921 Europe 219,988 201,705 11,314 433,007 Latin America 235,784 1,470 220 237,474 Asia 45,049 32,186 — 77,235 Total $ 1,233,351 $ 495,200 $ 65,086 $ 1,793,637 (In thousands) For the Nine Months Ended September 30, 2022 Geographic Market Surfactants Polymers Specialty Total North America $ 824,095 $ 357,303 $ 64,050 $ 1,245,448 Europe 269,952 251,229 12,067 533,248 Latin America 281,734 3,450 995 286,179 Asia 52,430 28,789 — 81,219 Total $ 1,428,211 $ 640,771 $ 77,112 $ 2,146,094 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | At September 30, 2023 and December 31, 2022, debt was comprised of the following: (In thousands) Maturity September 30, December 31, Senior unsecured notes 3.95 % (net of unamortized debt issuance cost 215 and $ 186 for 2023 and 2022, respectively) 2023 - 2027 $ 56,928 $ 71,243 3.86 % (net of unamortized debt issuance cost 125 and $ 125 for 2023 and 2022, respectively) 2023 - 2025 28,446 42,732 4.86 % (net of unamortized debt issuance cost 0 and $ 30 for 2023 and 2022, respectively) 2023 9,286 9,260 2.30 % (net of unamortized debt issuance cost 159 and $ 122 for 2023 and 2022, respectively) 2024 - 2028 49,841 49,878 2.37 % (net of unamortized debt issuance cost 165 and $ 128 for 2023 and 2022, respectively) 2024 - 2028 49,835 49,872 2.73 % (net of unamortized debt issuance cost 201 and $ 55 for 2023 and 2022, respectively) 2025 - 2031 99,799 99,945 2.83 % (net of unamortized debt issuance cost 152 and $ 40 for 2023 and 2022, respectively) 2026 - 2032 74,848 74,960 Revolving credit facility and term loan borrowing 2023 - 2027 274,000 189,250 Debt of foreign subsidiaries Unsecured bank debt, foreign currency 2023 6,406 - Total debt $ 649,389 $ 587,140 Less current maturities 227,014 132,111 Long-term debt $ 422,375 $ 455,029 |
Other, Net (Tables)
Other, Net (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Other Income and Expenses [Abstract] | |
Other Net in Condensed Consolidated Statements of Income | Other, net in the condensed consolidated statements of income included the following: (In thousands) Three Months Ended Nine Months Ended 2023 2022 2023 2022 Foreign exchange gains (losses) $ ( 623 ) $ ( 1,387 ) $ ( 541 ) $ ( 2,612 ) Investment income 85 114 299 508 Realized and unrealized gains (losses) on investments ( 481 ) ( 1,101 ) 2,598 ( 8,073 ) Net periodic benefit cost 329 394 992 1,178 Other, net $ ( 690 ) $ ( 1,980 ) $ 3,348 $ ( 8,999 ) |
Reconciliations of Equity - Rec
Reconciliations of Equity - Reconciliations of Total Equity (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Reconciliations of total equity | ||||
Beginning Balance | $ 1,215,097 | $ 1,125,711 | $ 1,166,065 | $ 1,074,193 |
Issuance of common stock under incentive compensation plan | 470 | 169 | 2,386 | 353 |
Purchase of common stock | (5,281) | (22,257) | ||
Stock-based and deferred compensation | 1,750 | 3,300 | 1,215 | 10,226 |
Net income | 12,571 | 39,384 | 41,397 | 136,319 |
Other comprehensive income (loss) | (18,955) | (25,571) | 16,187 | (46,137) |
Cash dividends paid: | ||||
Common stock | (8,162) | (7,473) | (24,479) | (22,458) |
Ending Balance | 1,202,771 | 1,130,239 | 1,202,771 | 1,130,239 |
Common Stock [Member] | ||||
Reconciliations of total equity | ||||
Beginning Balance | 26,978 | 26,825 | 26,841 | 26,761 |
Issuance of common stock under incentive compensation plan | 11 | 3 | 44 | 5 |
Stock-based and deferred compensation | 1 | 104 | 63 | |
Cash dividends paid: | ||||
Ending Balance | 26,989 | 26,829 | 26,989 | 26,829 |
Additional Paid-in Capital [Member] | ||||
Reconciliations of total equity | ||||
Beginning Balance | 242,215 | 229,510 | 237,202 | 220,820 |
Issuance of common stock under incentive compensation plan | 459 | 166 | 2,342 | 348 |
Stock-based and deferred compensation | 1,757 | 3,360 | 4,887 | 11,868 |
Cash dividends paid: | ||||
Ending Balance | 244,431 | 233,036 | 244,431 | 233,036 |
Common Treasury Stock [Member] | ||||
Reconciliations of total equity | ||||
Beginning Balance | (184,365) | (172,322) | (180,596) | (153,702) |
Purchase of common stock | (5,281) | (22,257) | ||
Stock-based and deferred compensation | (7) | (61) | (3,776) | (1,705) |
Cash dividends paid: | ||||
Ending Balance | (184,372) | (177,664) | (184,372) | (177,664) |
Accumulated Other Comprehensive Income (Loss) [Member] | ||||
Reconciliations of total equity | ||||
Beginning Balance | (132,370) | (173,802) | (167,512) | (153,236) |
Other comprehensive income (loss) | (18,955) | (25,571) | 16,187 | (46,137) |
Cash dividends paid: | ||||
Ending Balance | (151,325) | (199,373) | (151,325) | (199,373) |
Retained Earnings [Member] | ||||
Reconciliations of total equity | ||||
Beginning Balance | 1,262,639 | 1,215,500 | 1,250,130 | 1,133,550 |
Net income | 12,571 | 39,384 | 41,397 | 136,319 |
Cash dividends paid: | ||||
Common stock | (8,162) | (7,473) | (24,479) | (22,458) |
Ending Balance | $ 1,267,048 | $ 1,247,411 | $ 1,267,048 | $ 1,247,411 |
Reconciliations of Equity - R_2
Reconciliations of Equity - Reconciliations of Total Equity (Parenthetical) (Detail) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Number of shares of common stock issued under incentive compensation plan | 10,730 | 2,734 | 43,502 | 5,381 |
Number of common stock shares purchased | 54,780 | 222,720 | ||
Common stock | $ 0.365 | $ 0.335 | $ 1.095 | $ 1.005 |
Common Stock [Member] | ||||
Number of shares of common stock issued under incentive compensation plan | 2,734 | 5,381 | ||
Additional Paid-in Capital [Member] | ||||
Number of shares of common stock issued under incentive compensation plan | 2,734 | 5,381 | ||
Common Treasury Stock [Member] | ||||
Number of common stock shares purchased | 54,780 | 222,720 | ||
Retained Earnings [Member] | ||||
Common stock | $ 0.335 | $ 1.005 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value Disclosures [Abstract] | ||
Unamortized debt issuance cost | $ 1,017,000 | $ 686,000 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Values and Related Carrying Values of Debt (Detail) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Carrying value | $ 650,406 | $ 587,826 |
Level 2 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Fair value | $ 604,979 | $ 541,029 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and Liabilities, Excluding Cash and Cash Equivalents, Measured on a Recurring Basis at Fair Value (Detail) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Mutual fund assets | $ 24,528 | $ 23,294 |
Derivative assets: | ||
Interest rate contracts | 9,030 | 8,357 |
Foreign currency contracts | 1,690 | 513 |
Total assets at fair value | 35,248 | 32,164 |
Derivative liabilities: | ||
Foreign currency contracts | 2,031 | 525 |
Level 1 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Mutual fund assets | 24,528 | 23,294 |
Derivative assets: | ||
Total assets at fair value | 24,528 | 23,294 |
Level 2 [Member] | ||
Derivative assets: | ||
Interest rate contracts | 9,030 | 8,357 |
Foreign currency contracts | 1,690 | 513 |
Total assets at fair value | 10,720 | 8,870 |
Derivative liabilities: | ||
Foreign currency contracts | $ 2,031 | $ 525 |
Derivative Instruments - Additi
Derivative Instruments - Additional Information (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Derivative Instruments And Hedging Activities Disclosures [Line Items] | ||
Derivative notional amount | $ 104,699,000 | $ 56,746,000 |
Revolving Credit Facility [Member] | ||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | ||
Debt Instrument, Maturity Date | Jun. 24, 2027 | |
Cash Flow Hedging [Member] | ||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | ||
Derivative notional amount | $ 100,000,000 | |
Maturity date of current interest swap contract | Mar. 10, 2027 | |
Minimum [Member] | ||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | ||
Derivative foreign currency exchange contracts durations | 1 month | |
Maximum [Member] | ||
Derivative Instruments And Hedging Activities Disclosures [Line Items] | ||
Derivative foreign currency exchange contracts durations | 3 months |
Stock-based Compensation - Addi
Stock-based Compensation - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2023 | |
Employee Stock Option | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Weighted average period for amortization of unrecognized compensation cost | 1 year 1 month 6 days |
Performance Shares and RSUs [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Weighted average period for amortization of unrecognized compensation cost | 1 year 9 months 18 days |
Stock Appreciation Rights (SARs) | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Weighted average period for amortization of unrecognized compensation cost | 1 year 8 months 12 days |
Stock-based Compensation - Comp
Stock-based Compensation - Compensation Expense Recorded for All Stock Options, Stock Appreciation Rights (SARs) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||||
Compensation expense | $ 1,520 | $ 3,057 | $ 3,677 | $ 10,012 |
Stock-based Compensation - Unre
Stock-based Compensation - Unrecognized Compensation Costs for Stock Options, Stock Awards and SARs (Detail) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Employee Stock Option | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unrecognized compensation costs for stock options, stock awards and SARs | $ 283 | $ 692 |
Performance Shares and RSUs [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unrecognized compensation costs for stock options, stock awards and SARs | 4,658 | 6,144 |
Stock Appreciation Rights (SARs) | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Unrecognized compensation costs for stock options, stock awards and SARs | $ 4,677 | $ 5,211 |
Stock-based Compensation - Shar
Stock-based Compensation - Share Based Payment Awards Granted in Period (Detail) | 9 Months Ended |
Sep. 30, 2023 shares | |
Employee Stock Option | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Stock options granted in period | 2,777 |
Performance Shares (at target) and RSUs [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards granted in period | 87,025 |
Stock Appreciation Rights (SARs) | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Awards granted in period | 77,006 |
Inventories - Composition of In
Inventories - Composition of Inventories (Detail) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 186,788 | $ 250,373 |
Raw materials | 97,758 | 152,158 |
Total inventories | $ 284,546 | $ 402,531 |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Cost Recognized in both Cost of Sale and Operating Expenses (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Lease Cost | ||||
Operating lease cost | $ 4,448 | $ 3,917 | $ 13,255 | $ 11,968 |
Short-term lease cost | 2,697 | 1,887 | 8,215 | 4,587 |
Variable lease cost | 674 | 205 | 1,834 | 630 |
Total lease cost | 7,819 | 6,009 | 23,304 | 17,185 |
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flow from operating leases | 4,447 | 3,903 | 13,276 | 11,908 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 916 | $ 455 | $ 8,336 | $ 4,017 |
Leases - Schedule of Lease Liab
Leases - Schedule of Lease Liability Payments (Detail) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
2023 (excluding the nine months ended September 30, 2023) | $ 4,310 | |
2024 | 13,549 | |
2025 | 9,346 | |
2026 | 6,976 | |
2027 | 6,270 | |
Subsequent to 2027 | 38,179 | |
Total Undiscounted Cash Flows | 78,630 | |
Less: Imputed interest | (12,190) | |
Present value | 66,440 | |
Current operating lease liabilities | 12,787 | |
Non-current operating lease liabilities | 53,653 | $ 50,559 |
Total lease liabilities | $ 66,440 |
Leases - Schedule of Operating
Leases - Schedule of Operating Leases Weighted Average, Remaining Lease Term and Discount Rate (Detail) | Sep. 30, 2023 |
Leases [Abstract] | |
Weighted-average remaining lease term-operating leases | 9 years |
Weighted-average discount rate-operating leases | 3.60% |
Leases - Additional Information
Leases - Additional Information (Detail) - Equipment and Railcars [Member] - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 | Sep. 30, 2023 |
Lessee, Lease, Description [Line Items] | |||
Leases not yet commenced | $ 5,959,000 | ||
Forecast [Member] | Maximum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Lessee, operating lease, term of contract | 7 years | 7 years | |
Forecast [Member] | Minimum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Lessee, operating lease, term of contract | 1 year | 1 year |
Contingencies - Additional Info
Contingencies - Additional Information (Detail) - USD ($) | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Site Contingency [Line Items] | |||
Environmental losses accrual | $ 21,814,000 | $ 32,628,000 | |
Cash expenditures related to legal and environmental matters | $ 11,384,000 | $ 1,511,000 | |
Contribution for future response costs | 5% | ||
Wilmington Site [Member] | |||
Site Contingency [Line Items] | |||
Payment of environmental response costs | $ 3,592,000 | ||
Minimum [Member] | |||
Site Contingency [Line Items] | |||
Environmental losses and legal losses | 21,814,000 | ||
Maximum [Member] | |||
Site Contingency [Line Items] | |||
Environmental losses and legal losses | $ 45,769,000 |
Postretirement Benefit Plans -
Postretirement Benefit Plans - Components of Net Periodic Benefit Cost (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Net periodic benefit cost (income) | $ (329) | $ (394) | $ (992) | $ (1,178) |
United States [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Interest cost | 1,731 | 1,235 | 5,193 | 3,704 |
Expected return on plan assets | (2,133) | (2,201) | (6,399) | (6,602) |
Amortization of net actuarial loss | (6) | 577 | (18) | 1,731 |
Net periodic benefit cost (income) | (408) | (389) | (1,224) | (1,167) |
United Kingdom [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Interest cost | 171 | 86 | 504 | 282 |
Expected return on plan assets | (177) | (93) | (522) | (300) |
Amortization of net actuarial loss | 85 | 2 | 250 | 7 |
Net periodic benefit cost (income) | $ 79 | $ (5) | $ 232 | $ (11) |
Postretirement Benefit Plans _2
Postretirement Benefit Plans - Defined Benefit Pension Plans - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | |
Percentage of union and non-union employees eligible for either statutory or Company's sponsored profit sharing contributions | 85% |
Percentage of us based union and non-union employees eligible for either statutory or Company's sponsored profit sharing contributions | 100% |
Defined Contribution Plans [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Balance of trust assets | $ 409,000 |
United States [Member] | Unfunded Plan [Member] | Non-qualified Plans [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Expected contributions or payments to defined benefit plans | 256,000 |
Employer contributions or payments | 209,000 |
U.K Plans [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Expected contributions or payments to defined benefit plans | 451,000 |
Employer contributions or payments | $ 360,000 |
Postretirement Benefit Plans _3
Postretirement Benefit Plans - Defined Contribution Plan Expenses for Company's Qualified Contribution Plans (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Defined Contribution Plan Disclosure [Line Items] | ||||
Total defined contribution plan expenses | $ 2,774 | $ 3,756 | $ 7,862 | $ 11,326 |
Retirement Savings Contributions [Member] | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Total defined contribution plan expenses | 2,101 | 1,897 | 6,319 | 6,042 |
Profit Sharing Contributions [Member] | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Total defined contribution plan expenses | $ 673 | $ 1,859 | $ 1,543 | $ 5,284 |
Earnings Per Share - Computatio
Earnings Per Share - Computations of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | ||
Computation of Basic Earnings per Share | |||||
Net income attributable to Stepan Company | $ 12,571 | $ 39,384 | $ 41,397 | $ 136,319 | |
Weighted-average number of common shares outstanding | 22,786 | 22,753 | 22,770 | 22,813 | |
Basic earnings per share | $ 0.55 | $ 1.73 | $ 1.82 | $ 5.98 | |
Computation of Diluted Earnings per Share | |||||
Net income attributable to Stepan Company | $ 12,571 | $ 39,384 | $ 41,397 | $ 136,319 | |
Weighted-average number of common shares outstanding | 22,786 | 22,753 | 22,770 | 22,813 | |
Add weighted-average net shares related to unvested stock awards (under treasury stock method) | 3 | 2 | 2 | 1 | |
Weighted-average shares applicable to diluted earnings | 22,930 | 23,034 | 22,956 | 23,089 | |
Diluted earnings per share | $ 0.55 | $ 1.71 | $ 1.8 | $ 5.9 | |
Employee Stock Option | |||||
Computation of Diluted Earnings per Share | |||||
Add weighted-average net shares from assumed exercise of options (under treasury stock method) | [1] | 54 | 102 | 75 | 105 |
Stock Appreciation Rights (SARs) [Member] | |||||
Computation of Diluted Earnings per Share | |||||
Add weighted-average net shares from assumed exercise of options (under treasury stock method) | [1] | 53 | 108 | 78 | 111 |
Performance Stock Award [Member] | |||||
Computation of Diluted Earnings per Share | |||||
Add weighted-average net shares from assumed exercise of options (under treasury stock method) | 34 | 69 | 31 | 59 | |
[1] 822,271 and 623,648 options/SARs to acquire shares of the Company's common stock were excluded from the computation of dilutive earnings per share for the three and nine months ended September 30, 2023 , respectively. The options/SARs' exercise prices were greater than the average market price for the Company's common stock and inclusion of the instruments would have had an antidilutive effect on the computations of the earnings per share. 336,727 and 346,044 options/SARs to acquire shares of the Company's common stock were excluded from the computation of dilutive earnings per share for the three and nine months ended September 30, 2022 , respectively. |
Earnings Per Share - Computat_2
Earnings Per Share - Computations of Basic and Diluted Earnings Per Share (Parenthetical) (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Options and Stock Appreciation Rights (SARs) [Member] | ||||
Earnings Per Share Basic [Line Items] | ||||
Options/SARs to purchase shares of common stock were excluded from the computations of diluted earnings per share | 822,271 | 336,727 | 623,648 | 346,044 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Summary of Changes in Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | $ 1,166,065 | |||
Ending Balance | $ 1,202,771 | 1,202,771 | ||
Foreign Currency Translation Adjustments [Member] | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | (121,915) | $ (161,535) | (156,835) | $ (135,268) |
Other comprehensive income before reclassifications | (19,578) | (30,002) | 15,342 | (56,269) |
Net current-period other comprehensive income | (19,578) | (30,002) | 15,342 | (56,269) |
Ending Balance | (141,493) | (191,537) | (141,493) | (191,537) |
Defined Benefit Pension Plan Adjustments [Member] | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | (18,961) | (17,152) | (19,079) | (18,022) |
Amounts reclassified from AOCI | 61 | 435 | 179 | 1,305 |
Net current-period other comprehensive income | 61 | 435 | 179 | 1,305 |
Ending Balance | (18,900) | (16,717) | (18,900) | (16,717) |
Cash Flow Hedge Adjustments [Member] | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | 8,506 | 4,885 | 8,402 | 54 |
Other comprehensive income before reclassifications | 564 | 3,998 | 673 | 8,834 |
Amounts reclassified from AOCI | (2) | (2) | (7) | (7) |
Net current-period other comprehensive income | 562 | 3,996 | 666 | 8,827 |
Ending Balance | 9,068 | 8,881 | 9,068 | 8,881 |
AOCI Attributable to Parent [Member] | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | (132,370) | (173,802) | (167,512) | (153,236) |
Other comprehensive income before reclassifications | (19,014) | (26,004) | 16,015 | (47,435) |
Amounts reclassified from AOCI | 59 | 433 | 172 | 1,298 |
Net current-period other comprehensive income | (18,955) | (25,571) | 16,187 | (46,137) |
Ending Balance | $ (151,325) | $ (199,373) | $ (151,325) | $ (199,373) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) - Summary of Amounts Reclassifications Out of Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | ||||||||
Income Before Provision for Income Taxes | $ 15,840 | $ 50,458 | $ 52,057 | $ 179,392 | ||||
Tax benefit | (3,269) | (11,074) | (10,660) | (43,073) | ||||
Cost of Sales | 490,990 | 600,709 | 1,582,444 | 1,786,785 | ||||
Defined Benefit Pension Plan Adjustments [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member] | ||||||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | ||||||||
Amortization of defined benefit pension actuarial losses | [1] | (79) | [2] | (579) | [2] | 232 | (1,738) | [2] |
Tax benefit | [1] | (18) | 144 | (53) | 433 | |||
Income applicable to common stock | [1] | (61) | (435) | (179) | (1,305) | |||
Cash Flow Hedge Adjustments [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member] | ||||||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | ||||||||
Income Before Provision for Income Taxes | [1] | 2 | 2 | 7 | 7 | |||
Income applicable to common stock | [1] | 2 | 2 | 7 | 7 | |||
Cash Flow Hedge Adjustments [Member] | Foreign exchange contracts [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member] | ||||||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | ||||||||
Cost of Sales | [1] | 2 | 2 | 7 | 7 | |||
Accumulated Other Comprehensive Income (Loss) [Member] | ||||||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | ||||||||
Income applicable to common stock | [1] | $ (59) | $ (433) | $ (172) | $ (1,298) | |||
[1] A mounts in parentheses denote expense to the Company’s Condensed Consolidated Statements of Income. This component of accumulated other comprehensive income is included in the computation of net periodic benefit cost. See Note 9, Postretirement Benefit Plans , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q) for additional details. |
Segment Reporting - Additional
Segment Reporting - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2023 Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Segment Reporting - Operating S
Segment Reporting - Operating Segment (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 562,226 | $ 719,185 | $ 1,793,637 | $ 2,146,094 |
Surfactants [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 373,836 | 474,861 | 1,233,351 | 1,428,211 |
Polymers [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 169,559 | 214,807 | 495,200 | 640,771 |
Specialty Products [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | $ 18,831 | $ 29,517 | $ 65,086 | $ 77,112 |
Segment Reporting - Reconciliat
Segment Reporting - Reconciliation of Segment Information to Income Before Provision for Income Taxes (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | ||
Segment Reporting Information [Line Items] | |||||
Operating Income | $ 19,517 | $ 54,659 | $ 58,383 | $ 195,645 | |
Business restructuring | (5,628) | (92) | (5,827) | (225) | |
Other Income (Expense) | |||||
Interest, net | (2,987) | (2,221) | (9,674) | (7,254) | |
Other, net | (690) | (1,980) | 3,348 | (8,999) | |
Income before provision for income taxes | 15,840 | 50,458 | 52,057 | 179,392 | |
Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Income | 39,588 | 80,525 | 114,411 | 244,145 | |
Operating Segments [Member] | Surfactants [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Income | 15,373 | 38,976 | 57,570 | 140,994 | |
Operating Segments [Member] | Polymers [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Income | 21,813 | 31,864 | 48,137 | 79,905 | |
Operating Segments [Member] | Specialty Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Income | 2,402 | 9,685 | 8,704 | 23,246 | |
Segment Reconciling Items [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Unallocated corporate expenses | [1] | $ (14,443) | $ (25,774) | $ (50,201) | $ (48,275) |
[1] Unallocated corporate expenses are primarily comprised of corporate administrative expenses (e.g., corporate finance, legal, human resources, information systems, deferred compensation and environmental remediation) that are not included in segment operating income and are not used to evaluate segment performance. |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Additional Information (Detail) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2020 | Dec. 31, 2022 | |
Disaggregation Of Revenue [Line Items] | |||
Contract assets | $ 0 | ||
Contract liabilities | 478,000 | ||
Contract liabilities revenue recorded | 1,292,000 | $ 10,709,000 | |
Pre-existing Contract Liabilities [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Contract liabilities | $ 739,000 | ||
Long-Term [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Contract liabilities revenue recorded | 7,201,000 | ||
Short-Term [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Contract liabilities revenue recorded | $ 2,216,000 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Summary of Geographic Disaggregation of Net Sales (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation Of Revenue [Line Items] | ||||
Net sales | $ 562,226 | $ 719,185 | $ 1,793,637 | $ 2,146,094 |
Surfactants [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 373,836 | 474,861 | 1,233,351 | 1,428,211 |
Polymers [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 169,559 | 214,807 | 495,200 | 640,771 |
Specialty Products [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 18,831 | 29,517 | 65,086 | 77,112 |
North America [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 329,888 | 425,919 | 1,045,921 | 1,245,448 |
North America [Member] | Surfactants [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 223,912 | 272,557 | 732,530 | 824,095 |
North America [Member] | Polymers [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 90,521 | 128,992 | 259,839 | 357,303 |
North America [Member] | Specialty Products [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 15,455 | 24,370 | 53,552 | 64,050 |
Europe [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 130,146 | 167,180 | 433,007 | 533,248 |
Europe [Member] | Surfactants [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 60,126 | 86,344 | 219,988 | 269,952 |
Europe [Member] | Polymers [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 66,752 | 76,022 | 201,705 | 251,229 |
Europe [Member] | Specialty Products [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 3,268 | 4,814 | 11,314 | 12,067 |
Latin America [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 76,989 | 99,727 | 237,474 | 286,179 |
Latin America [Member] | Surfactants [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 76,469 | 98,313 | 235,784 | 281,734 |
Latin America [Member] | Polymers [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 412 | 1,081 | 1,470 | 3,450 |
Latin America [Member] | Specialty Products [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 108 | 333 | 220 | 995 |
Asia [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 25,203 | 26,359 | 77,235 | 81,219 |
Asia [Member] | Surfactants [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | 13,329 | 17,647 | 45,049 | 52,430 |
Asia [Member] | Polymers [Member] | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net sales | $ 11,874 | $ 8,712 | $ 32,186 | $ 28,789 |
Debt - Debt (Detail)
Debt - Debt (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | ||
Total debt | $ 649,389 | $ 587,140 |
Less current maturities | 227,014 | 132,111 |
Long-term debt | 422,375 | 455,029 |
Senior unsecured 3.95% note [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 56,928 | $ 71,243 |
Debt instrument interest rate percentage | 3.95% | 3.95% |
Senior unsecured 3.95% note [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2023 | 2023 |
Senior unsecured 3.95% note [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2027 | 2027 |
Senior unsecured 3.86% note [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 28,446 | $ 42,732 |
Debt instrument interest rate percentage | 3.86% | 3.86% |
Senior unsecured 3.86% note [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2023 | 2023 |
Senior unsecured 3.86% note [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2025 | 2025 |
Senior unsecured 4.86% note [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 9,286 | $ 9,260 |
Debt instrument interest rate percentage | 4.86% | 4.86% |
Senior unsecured 4.86% note [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2023 | 2023 |
Senior unsecured 4.86% note [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2023 | 2023 |
Senior unsecured 2.30% note [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 49,841 | $ 49,878 |
Debt instrument interest rate percentage | 2.30% | 2.30% |
Senior unsecured 2.30% note [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2024 | 2024 |
Senior unsecured 2.30% note [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2028 | 2028 |
Senior unsecured 2.37% note [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 49,835 | $ 49,872 |
Debt instrument interest rate percentage | 2.37% | 2.37% |
Senior unsecured 2.37% note [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2024 | 2024 |
Senior unsecured 2.37% note [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2028 | 2028 |
Senior unsecured 2.73% note [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 99,799 | $ 99,945 |
Debt instrument interest rate percentage | 2.73% | 2.73% |
Senior unsecured 2.73% note [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2025 | 2025 |
Senior unsecured 2.73% note [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2031 | 2031 |
Senior unsecured 2.83% note [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 74,848 | $ 74,960 |
Debt instrument interest rate percentage | 2.83% | 2.83% |
Senior unsecured 2.83% note [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2026 | 2026 |
Senior unsecured 2.83% note [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2032 | 2032 |
Debt of foreign subsidiaries Unsecured bank debt, foreign currency [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 6,406 | |
Maturity Dates | 2023 | 2023 |
Revolving credit facility and term loan borrowing [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 274,000 | $ 189,250 |
Revolving credit facility and term loan borrowing [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2023 | 2023 |
Revolving credit facility and term loan borrowing [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Maturity Dates | 2027 | 2027 |
Debt - Debt (Parenthetical) (De
Debt - Debt (Parenthetical) (Detail) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Unamortized debt issuance cost | $ 1,017,000 | $ 686,000 |
Senior unsecured 3.95% note [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized debt issuance cost | 215,000 | 186,000 |
Senior unsecured 3.86% note [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized debt issuance cost | 125,000 | 125,000 |
Senior unsecured 4.86% note [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized debt issuance cost | 0 | 30,000 |
Senior unsecured 2.30% note [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized debt issuance cost | 159,000 | 122,000 |
Senior unsecured 2.37% note [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized debt issuance cost | 165,000 | 128,000 |
Senior unsecured 2.73% note [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized debt issuance cost | 201,000 | 55,000 |
Senior unsecured 2.83% note [Member] | ||
Debt Instrument [Line Items] | ||
Unamortized debt issuance cost | $ 152,000 | $ 40,000 |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) | 9 Months Ended | ||||
Sep. 29, 2023 | Jun. 24, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | |||||
Total debt | $ 649,389,000 | $ 587,140,000 | |||
Term loan principal repaid | $ 28,572,000 | $ 28,571,000 | |||
Debt instrument maturity dates description | The notes had original maturities of seven to 12 years with mandatory principal payments beginning four, five and six years after issuance | ||||
Multi-Currency Credit Facility with Syndicate of Banks [Member] | |||||
Debt Instrument [Line Items] | |||||
Borrowing capacity | $ 450,000,000 | ||||
Committed multi-currency credit facility, maturity date | Jun. 24, 2027 | ||||
Multi-Currency Revolving Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Maturity Date | Jun. 24, 2027 | ||||
Multi-Currency Revolving Credit Facility [Member] | Multi-Currency Credit Facility with Syndicate of Banks [Member] | |||||
Debt Instrument [Line Items] | |||||
Borrowing capacity | $ 350,000,000 | ||||
Delayed Draw Term Loan Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Borrowing capacity | $ 96,250,000 | ||||
Term loan principal repaid | 3,750,000 | ||||
Delayed Draw Term Loan Credit Facility [Member] | Multi-Currency Credit Facility with Syndicate of Banks [Member] | |||||
Debt Instrument [Line Items] | |||||
Borrowing capacity | $ 100,000,000 | ||||
Multi Currency Revolving Credit Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
Outstanding borrowings, including term loan | 274,000,000 | ||||
Letters of Credit Outstanding | 10,951,000 | ||||
Unused Revolving credit | 161,299,000 | ||||
Unrestricted retained earnings | 243,493,000 | $ 224,189,000 | |||
Unsecured Private Placement Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Total debt | $ 368,983,000 | ||||
Unsecured Private Placement Notes [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument interest rate percentage | 2.30% | ||||
Maturity Dates | 7 years | ||||
Unsecured Private Placement Notes [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument interest rate percentage | 4.86% | ||||
Maturity Dates | 12 years | ||||
Note Purchase Agreements [Member] | |||||
Debt Instrument [Line Items] | |||||
Percentage of unrestricted and unencumbered foreign-based cash | 65% | ||||
Percentage of debt instruments rating fee | 0.75% |
Other, Net - Other Net in Conde
Other, Net - Other Net in Condensed Consolidated Statements of Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Other Nonoperating Income (Expense) [Abstract] | ||||
Foreign exchange gains (losses) | $ (623) | $ (1,387) | $ (541) | $ (2,612) |
Investment income | 85 | 114 | 299 | 508 |
Realized and unrealized gains (losses) on investments | (481) | (1,101) | 2,598 | (8,073) |
Net periodic pension benefit income | 329 | 394 | 992 | 1,178 |
Other, net | $ (690) | $ (1,980) | $ 3,348 | $ (8,999) |
Goodwill Impairment - Additiona
Goodwill Impairment - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended |
Jun. 30, 2023 | Sep. 30, 2022 | |
Goodwill [Line Items] | ||
Goodwill impairment | $ 978,000 | |
Philippines Reporting Unit [Member] | ||
Goodwill [Line Items] | ||
Goodwill impairment | $ 978,000 | |
Other Reporting Units [Member] | ||
Goodwill [Line Items] | ||
Goodwill impairment | $ 0 |
Noncash Investing and Financi_2
Noncash Investing and Financing Activities - Additional Information (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Supplemental Cash Flow Elements [Line Items] | ||
Noncash investing activities, payables incurred for property, plant and equipment expenditures, unpaid | $ 15,715,000 | $ 44,833,000 |
Common Stock [Member] | Stock Award Plan [Member] | ||
Supplemental Cash Flow Elements [Line Items] | ||
Noncash financing activities shares issued | 97,774 | 58,441 |
Stock issued | $ 10,480,000 | $ 6,095,000 |
Business Restructuring - Additi
Business Restructuring - Additional Information (Detail) $ in Thousands | 3 Months Ended |
Sep. 30, 2023 USD ($) | |
2023 Restructuring [Member] | |
Restructuring Cost And Reserve [Line Items] | |
Business restructuring | $ 5,530,000 |