Stepan Company, together with its subsidiaries, produces and sells specialty and intermediate chemicals to other manufacturers for use in various end products. It operates through three segments: Surfactants, Polymers, and Specialty Products. The Surfactants segment offers surfactants that are used as principal ingredients in consumer and industrial cleaning products, including detergents for washing clothes, dishes, carpets, and floors and walls, as well as shampoos and body washes; and other applications, such as fabric softeners, germicidal quaternary compounds, disinfectants, and lubricating ingredients. Its surfactants are also used in various applications, including emulsifiers for spreading agricultural products; and industrial applications comprising latex systems, plastics, and composites. The Polymers segment provides polyurethane polyols that are used in the manufacture of rigid foam for thermal insulation in the construction industry, as well as a base raw material for coatings, adhesives, sealants, and elastomers (CASE); polyester resins, including liquid and powdered products, which are used in CASE applications; and phthalic anhydride that is used in unsaturated polyester resins, alkyd resins, and plasticizers for applications in construction materials, as well as components of automotive, boating, and other consumer products. The Specialty Products segment offers flavors, emulsifiers, and solubilizers for use in food, flavoring, nutritional supplement, and pharmaceutical applications. It serves in the United States, France, Poland, the United Kingdom, Brazil, Mexico, and internationally. Stepan Company was founded in 1932 and is headquartered in Northbrook, Illinois.
AI Generated Analysis | Feedback
Here are 1-3 brief analogies for Stepan (SCL):
- A specialty chemical company, much like a focused version of Dow or DuPont, providing essential ingredients for detergents, cosmetics, and industrial products.
- The 'hidden ingredient' provider for many consumer and industrial products, similar to how International Flavors & Fragrances (IFF) supplies flavors and fragrances.
- An essential ingredient supplier for various manufacturers, comparable to how Cargill provides ingredients for food, but for chemicals used in cleaning and personal care products.
AI Generated Analysis | Feedback
- Surfactants: Chemical compounds used in a wide range of consumer products like detergents, shampoos, and cosmetics, as well as industrial applications such as oilfield and agricultural chemicals.
- Polymers: Primarily used in the production of polyurethane foam for insulation, furniture, and automotive applications, and also in coatings, adhesives, and sealants.
- Specialty Products: Diverse chemical intermediates including phthalic anhydride and medium-chain triglycerides (MCTs) for food, nutrition, and pharmaceutical industries.
AI Generated Analysis | Feedback
Major Customers of Stepan (SCL)
Stepan Company (SCL) primarily sells its specialty chemicals and intermediate products to other companies (Business-to-Business, or B2B), rather than directly to individual consumers.
According to its most recent 10-K filings, no single customer accounted for more than 10% of Stepan's consolidated net sales during the past three fiscal years. This indicates a diversified customer base, and Stepan does not publicly disclose the names of specific "major" customer companies.
Instead, Stepan serves a wide array of manufacturers across various industries. The primary categories of companies that utilize Stepan's products include:
- Consumer Product Manufacturers: These companies produce everyday items such as laundry detergents, dishwashing liquids, shampoos, soaps, cosmetics, and other personal care products. They incorporate Stepan's surfactants and specialty ingredients into their final product formulations.
- Industrial & Institutional (I&I) Product Manufacturers: Businesses that develop and supply cleaning products for commercial and industrial applications, disinfectants, oilfield chemicals, agricultural chemicals, and materials for construction, such as rigid polyurethane foam insulation.
- Food, Flavor, Fragrance, and Pharmaceutical Manufacturers: Companies that utilize Stepan's specialty products (e.g., emulsifiers, flavor ingredients, solubilizers) in the production of food and beverage items, flavorings, fragrances, and pharmaceutical formulations.
AI Generated Analysis | Feedback
Luis E. Rojo, President and Chief Executive Officer
Luis E. Rojo was appointed President and Chief Executive Officer of Stepan Company on October 30, 2024, and also joined the Board of Directors at that time. Prior to this role, he served as Stepan's Vice President and Chief Financial Officer from April 2018. Before joining Stepan, Mr. Rojo had a 21-year career at Procter & Gamble Co., holding increasingly senior finance leadership positions. His experience at Stepan has been noted for his deep understanding of all aspects of the business, combining a strong financial mindset with strategic thinking and a focus on driving commercial and operational results.
Ruben Velasquez, Vice President and Chief Financial Officer
Ruben Velasquez was appointed Vice President and Chief Financial Officer of Stepan Company, effective July 15, 2025. He brings over two decades of global finance leadership experience across diverse industries. Most recently, he served as Vice President Global Finance Transformation at 3M Company from 2022 through 2024. Prior to that, Mr. Velasquez held several other senior finance roles at 3M, including Vice President Global Finance and CFO Manufacturing & Supply Chain Operations, and Vice President Global Finance and CFO Consumer Business. He also held positions as Finance Director and Country CFO at 3M Russia and 3M Colombia. Mr. Velasquez began his finance career at Ecopetrol in Colombia, where he held senior finance leadership roles such as Finance Director Corporate FP&A and Treasury, and Interim Vice President and Corporate Chief Financial Officer.
F. Quinn Stepan, Jr., Chairman of the Board
F. Quinn Stepan, Jr. has served as the Chairman of the Board of Stepan Company since January 2017. He previously held the positions of President and Chief Executive Officer of the Company from January 2006 until his retirement as CEO in April 2022, after which he continued as non-executive Chairman. Mr. Stepan joined the company in 1987, following four years with Monsanto Co. Over his career of more than 30 years with Stepan, he has held various positions of increasing responsibility across different functions, including serving as Vice President and General Manager of the surfactant department before becoming president in 1999. He is the son of F. Quinn Stepan, Sr., and the grandson of the company's founder, Alfred C. Stepan Jr.
Robert J. Haire, Jr., Executive Vice President, Supply Chain
Robert J. Haire, Jr. is the Executive Vice President of Supply Chain at Stepan Company. His specific background details regarding previous companies managed, company sales, or private equity involvement are not readily available in the provided search results.
Jason Scott Keiper, Vice President and Chief Technology and Sustainability Officer
Jason Scott Keiper is the Vice President and Chief Technology and Sustainability Officer at Stepan Company. Before joining Stepan, Mr. Keiper worked at Syngenta, where he held roles such as Head, Product Technology and Engineering; Head, Global Formulation and Analytical Development; Technology and Engineering; and Technology and Projects Manager, North America.
AI Generated Analysis | Feedback
The key risks to Stepan Company's business include:
- Volatility of Raw Material and Energy Costs: Stepan's profitability is significantly influenced by the fluctuating costs of raw materials, such as petroleum-based products, and energy, particularly natural gas. Raw materials alone constitute approximately 60% of the company's annual revenues, making its margins highly susceptible to price instability. The company may not always be able to pass these increased costs on to customers due to existing arrangements and competitive market pressures.
- Exposure to Cyclical Industries and Economic Downturns: A substantial portion of Stepan's sales, about 40%, is derived from cyclical industries like energy, construction, automotive, and industrial sectors. Consequently, the company's sales, earnings, and cash flow are prone to fluctuations with the broader global economy. Economic downturns or recessions in these industries can lead to significant reductions in product volumes, sales, and profit margins.
- International Business Risks: With 40% of its sales generated overseas and significant exposure to emerging markets, Stepan faces considerable international business risks. These include currency exchange rate fluctuations, which can impact financial results, and changes in global trade policies, such as the imposition of tariffs. Geopolitical instability in regions where Stepan operates also poses a risk.
AI Generated Analysis | Feedback
The accelerated development and commercialization of cost-competitive, high-performance bio-based and circular economy chemical alternatives in Stepan's key markets (surfactants, polyols) by rival established chemical companies or disruptive startups. This trend, driven by increasing consumer demand, regulatory pressure, and investor focus on environmental, social, and governance (ESG) factors, represents a fundamental shift in feedstock sourcing and chemical manufacturing processes. While Stepan is investing in sustainable solutions, a competitor achieving a significant breakthrough in scalability, cost-effectiveness, or superior performance in these new chemical platforms could disrupt Stepan's traditional petrochemical-based product lines and erode market share.
AI Generated Analysis | Feedback
Stepan Company (SCL) operates primarily in three business segments: Surfactants, Polymers, and Specialty Products. The addressable markets for these main product categories are detailed below.
Surfactants
Surfactants constitute the largest segment of Stepan's business, with applications spanning household and personal care products, industrial and institutional cleaning, agricultural chemicals, and oilfield solutions.
- The global surfactants market size was valued at approximately USD 47.36 billion in 2024 and is projected to reach USD 70.13 billion by 2032, growing at a Compound Annual Growth Rate (CAGR) of 4.9% during the forecast period. Another estimate indicates a global market size of USD 51.9 billion in 2025, expected to reach USD 82.1 billion by 2035.
- In North America, the surfactants market is projected to reach approximately 25% of the global market by 2025. The U.S. surfactants market is specifically projected to reach USD 12.82 billion by 2032.
- The Asia Pacific region is a dominant market, holding approximately 40.31% of the global surfactants market in 2023. This region's market size was exhibited at USD 17.28 billion in 2025 and is projected to be worth around USD 28.04 billion by 2034.
Polymers
Stepan's Polymers segment focuses on producing polyurethane polyols, polyester resins, and phthalic anhydride, which are used in construction materials, automotive, marine, and other consumer products.
- The global specialty polymer market size, which encompasses Stepan's polymer offerings, was estimated at USD 88.55 billion in 2024 and is anticipated to reach approximately USD 170.96 billion by 2034, growing at a CAGR of 6.80%. Other analyses suggest a global market size of USD 199.5 billion in 2025, expected to reach USD 422.9 billion by 2035 with a CAGR of 7.8%.
- North America is a significant market for specialty polymers, holding approximately 40% of the global share. The Asia Pacific region is also a dominant market for specialty polymers, with a market share of over 40% in 2023. The Asia Pacific specialty polymer market size was USD 35.42 billion in 2024 and is expected to reach around USD 69.24 billion by 2034.
Specialty Products
Stepan's Specialty Products segment includes chemicals used in food, flavoring, nutritional supplements, and pharmaceutical applications, such as esters, fats, and oils used as emulsifiers and solubilizers.
- While a comprehensive market size for all of Stepan's diverse specialty products is not readily available as a single figure, a key component within this segment is Active Pharmaceutical Ingredients (API). The global active pharmaceutical ingredients market size was estimated at USD 255.01 billion in 2024 and is projected to reach USD 359.45 billion by 2030, with a CAGR of 5.8%. Another source values the global API market at USD 253.27 million in 2024, expected to reach USD 419.16 million by 2032 at a CAGR of 6.50%.
- North America holds a substantial share in the active pharmaceutical ingredients market, with a revenue share of 38.04% in 2024. The U.S. active pharmaceutical ingredients market alone was valued at USD 87.50 billion in 2024 and is estimated to reach USD 123.25 billion by 2033.
AI Generated Analysis | Feedback
Stepan Company (SCL) is expected to drive future revenue growth over the next 2-3 years through several key initiatives and market trends:
-
Volume Growth in Key End Markets: Stepan anticipates continued volume expansion across several of its core businesses. This includes double-digit volume growth in Surfactants within the Personal Care, Oil Field, Agricultural, and Construction and Industrial Solutions end markets. Growth is also expected with its distribution partners and in Latin America, particularly in Mexico and Brazil due to strong agricultural demand and new contracted business. The Polymers segment also saw volume growth in North American and European Rigid Polyols and Phthalic Anhydride products.
-
Pasadena Facility Contribution: The new Pasadena, Texas alkoxylation facility, which became operational in late 2025 and is expected to reach full contribution in 2026, is a significant driver. This facility is designed to support the growth of Stepan's specialty alkoxylation business, increase overall volumes, and enhance supply chain leverage, contributing to margin recovery.
-
Improved Product Mix and High-Margin Offerings: The company is focusing on a more profitable product mix, particularly within the Surfactants segment, by targeting high-margin new customers and leveraging strong growth in specialty alkoxylation. Specialty Products, including the medium chain triglycerides (MCT) product line, have also shown robust volume and margin growth.
-
Rebounding Polymer Demand: Stepan expects an improvement in Polymer demand, especially Rigid Polyols, contingent on macroeconomic clarity and a favorable interest rate environment that could stimulate construction activity. Growth in Rigid Polyols has been observed across all global regions.
-
Cost Reduction and Operational Efficiency: While primarily impacting profitability, ongoing cost reduction programs and productivity improvements are expected to support overall financial health and can indirectly contribute to revenue growth by allowing for competitive pricing and freeing up resources for strategic investments.
AI Generated Analysis | Feedback
Capital Allocation Decisions (2020-2025)
Share Repurchases
- Stepan Company completed the repurchase of 251,120 shares for $25.06 million under an equity buyback plan announced on October 20, 2021.
- No shares were repurchased for $0 million between October 1, 2024, and December 31, 2024, as part of the aforementioned buyback plan.
Outbound Investments
- In the second quarter of 2024, Stepan's pre-tax earnings were negatively impacted by $3.5 million due to expenses related to a criminal social engineering scheme at a subsidiary in Asia, which resulted in fraudulently induced outbound payments.
Capital Expenditures
- Capital expenditures were $126 million in 2020, $190 million in 2021, $302 million in 2022, $260 million in 2023, and $123 million in 2024.
- For the full year 2025, Stepan forecasts capital expenditures to be between $120 million and $125 million.
- A primary focus of capital expenditures has been the new alkoxylation capacity in Pasadena, Texas, which had an estimated CapEx of $265 million and was expected to begin operations in the first quarter of 2025. This investment is strategic for growing the alkoxylation business in ethoxylates and propoxylates.
