Stepan Company

Greetings and welcome to the Q2 2020 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question and answer session. At that time, if you have a question, please press the 1 followed by the 4 on your telephone. If at any time during the conference you need to reach an operator, please press star 0. As a reminder, this conference is being recorded Wednesday, July 22, 2020. I would now like to turn the conference over to Luis Rojo, Vice President and Chief Financial Officer. Please go ahead.

Good morning, and thank you for joining Stepan Company's second quarter 2020 financial review. Before we begin, please note that information in this conference call contains forward-looking statements, which are not historical facts. These statements involve risks and uncertainties that could cause actual results to differ materially. including but not limited to prospects for our foreign operations, global and regional economic conditions, and factors detailing our Security and Exchange Commission filing. Whether you are joining us online or over the phone, we encourage you to review the investor slide presentation, which we have made available at www.stepan.com under the investor relations section of our website. We make these slides available at approximately the same time as where the earnings releases issue, and we hope that you find the information and perspective helpful. Now with that, I would like to turn the call over to Mr. Gwynne Stepan, our Chairman, President, and Chief Executive Officer.

Thank you, Luis. Good morning, and thank you all for joining us. We hope you and your families are safe and healthy. Furthermore, We hope you are cleaning and disinfecting your homes and workspaces often and are washing your hands frequently. At Stepan, we appreciate the passion and commitment our employees have to supply products that contribute to the fight against the coronavirus. Despite the challenges of the pandemic and the impact of the first quarter power outage at our Millsdale facility, Stepan had a solid first half of the year. Second quarter adjusted net income was a record $38.3 million or $1.65 per diluted share versus $35.1 million or $1.50 per diluted share in the prior year. Surfactant income benefited from strong volumes in the global consumer product end market driven by higher demand for cleaning and disinfection products as a result of COVID-19. Functional product volumes were down. Mexican operations continue to deliver year-over-year earnings growth. Polymer income was down as COVID-19 construction project delays and cancellations in Europe and North America led to reduced rigid polyol volumes, partially offset by strong growth in China. Lower phthalic and hydride volume and higher raw material inventory costs associated also contributed to the decline in income. Our specialty product business results were lower due to order timing differences within our food and flavor business and lower margins within our medium chain triglyceride product line. Our Board of Directors declared a quarterly cash dividend on Stepan's common stock of 27.5 cents per share, payable on September 15, 2020. At this point, I'd like Luis to walk through a few more details about our second quarter results. Thank you, Quinn.