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Stepan reported third-quarter net income of USD36.9

October 21/2021

MOSCOW (MRC) -- Stepans Q3 sales rose 30% year on year while gross profit and operating income fell as cost of sales jumped 39% because of the ongoing supply chain disruptions, said the company. 

The Northfield, Illinois-based company said it had profit of USD1.59 per share. Earnings, adjusted for pretax gains, came to USD1.57 per share. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of USD1.39 per share.

The specialty chemicals company posted revenue of USD602.7 million in the period, which also topped Street forecasts. Four analysts surveyed by Zacks expected USD544.6 million.

Looking at Q4 and beyond, Stepan believes  that its Surfactant volumes in the North American consumer product end markets will continue to be challenged by raw material and transportation availability, said CEO F Quinn Stepan. While Stepan believes industrial and institutional cleaning volume will grow versus prior year in Q4, it does not believe that this will compensate for lower consumer consumption of cleaning, disinfection and personal wash products, he said.

However, demand for surfactants within the agricultural and oilfield markets is expected to exceed prior year demand, the CEO said. Meanwhile, Stepans Polymer business is expected to grow, due to the ongoing recovery from pandemic-related delays and cancellations of re-roofing and new construction projects and the INVISTA acquisition.

"We continue to believe the long-term prospects for rigid polyols remain attractive as energy conservation efforts and more stringent building codes are expected to continue,"  Stepan said. Stepans Specialty Product business results will improve slightly year-on-year in Q4. "Despite supply chain disruptions continuing to impact the company, we remain optimistic about delivering full year earnings growth," the CEO added. In related news, Stepan earlier on Wednesday announced plans to build a new alkoxylation plant at Pasadena, Texas.

As MRC informed before, Stepan conducted planned maintenance at its 90,000 tonnes/year phthalic anhydride (PA) plant Millsdale, Illinois, US, from early October to end-October, 2020.

Phthalic anhydride is widely used in for the production of paints and varnishes and plasticizers for PVC products. In a small amount it is used in the manufacture of rubber products, tires. In addition, it is used in the light, pharmaceutical and electrical industries.

According to MRC's DatasScope report, last month's SPVC imports to the Ukrainian market decreased to 2,300 tonnes from 2,700 tonnes in August, Ukrainian companies reduced their shipments of polymer from the USA. Overall SPVC imports reached 20,800 tonnes in January-September 2021, compared to 26,800 tonnes a year earlier. Limited export quotas of European and North American producers were the main reason for such a major fall in imports.
Author:Anna Larionova
Tags:PVC, Phthalic Anhydride, EPVC, PVC paste, SPVC, Stepan Company, USA.
Category:General News
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