Stepan Company

During the presentation, all participants will be in a listen-only mode. Afterward, we will conduct a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. As a reminder, this call is being recorded on Wednesday, February 19, 2025. It is now my pleasure to turn the call over to Mr. Sam Hinrichsen, Vice President and Interim Chief Financial Officer of Steppen Company. Mr. Hinrichsen, please go ahead.

Good morning, and thank you for joining Steppen Company's fourth quarter and full year 2024 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 risk and uncertainties that could cause actual results to differ materially, including but not limited to prospects for foreign operations, global and regional economic conditions, and factors detailed in our securities and exchange commission files. In addition, this conference call will include discussions of adjusted income, adjusted EBITDA, and free cash flow, which are non-GAAP measures. We provide reconciliations to the comparable GAAP measures in the earnings presentation and press release, which we have made available at www.stappen.com under the investor section of our website. Whether you are joining us online or over the phone, we encourage you to review the investor slide presentation. We make these slides available at approximately the same time as when the earnings release is issued, and we hope that you find the information and perspective helpful. With that, I would like to turn the call over to Mr. Luis Rojo, our President and Chief Executive Officer.

Thank you, Sam. Good morning, and thank you all for joining us today to discuss our fourth quarter and full year 2024 results. I plan to share highlights of the full year performance, and will also share updates on our key strategic priorities, while Sam will provide additional details on our financial results. The company reported fourth quarter adjusted EBITDA of $35 million, down 7% versus the prior year, and full year adjusted EBITDA of $187 million. While we are disappointed with our overall financial performance in 2024, we advanced our strategic investments and took the necessary steps to return the company to profitable growth. I'm proud of the resiliency and work and dedication on the entire organization. Full-year adjusted EBITDA grew 4% versus prior year, despite several one-time events that negatively impacted earnings and the pre-operating expenses on our new Pasadena site. Surfactant specialty products delivered a strong double-digit adjusted EBITDA growth, partially offset by softer demanding polymers. Global volumes grew 1%, driven by 2.5% growth in surfactant business. We are encouraged by the surfactant growth across several of our key strategic end markets. We finished the year with $50.5 million of adjusted net income, which was flat versus the prior year. A strong earnings growth in surfactant and specialty products was fully offset by polymers. Free cash flow for the year was positive at $39 million, and in line with our expectations and our operating plan. The company delivered $48 million in pre-tax cost out during 2024, mainly through disciplined efforts in supply chain and workforce productivity actions taken in the last quarter of 2023. During the fourth quarter of 2024, the company paid $8.7 million in dividends to shareholders. Our Board of Directors declared a quarterly cash dividend on Stepan common stock of $0.385 per share, payable on March 14, 2025. Stepan has paid an increases dividend for 57 consecutive years. Sam will now share some details about our fourth quarter and 2024 results.