Stepan Company

Good morning and welcome to the Step in Company's second quarter 2025 earnings conference call. 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, July 30, 2025. It is now my pleasure to turn the call over to Mr. Ruben Velazquez, Vice President and Chief Financial Officer of Step in Company. Mr. Velazquez, please go ahead.

Good morning and thank you for joining Step in Company's second quarter 2025 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 material, including but not limited to prospects for our foreign operations, global and regional economic conditions, and factors detailed in our securities and exchange commission filings. In addition, this conference call will include discussions of adjusted net income, adjusted EB-STAN and pre-cash flow, which are non-GAAP measures. We provide reconciliation to the comparable GAAP measures in the earnings presentation and press release, which we have made available at .stepin.com under the investor sections of our website. Whether you are joining us online or over the phone, we encourage you to review the investor's live 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 perspectives helpful. With that, I would like to turn the call over to Mr. Luis Rojo, our President and Chief Executive Officer.

Thank you, Ruben. Good morning. And thank you all for joining us today to discuss our second quarter 2025 results. Before we turn to business, I would like to welcome Ruben to his first Step-In Conference earnings call. And I look forward to working together on our new journey of growth and transformation. I also want to extend my sincere appreciation to Sam for his dedication, steady leadership, and contributions to the interim period. Thank you, Sam. Moving on, I plan to share highlights of the quarterly performance, and we will also share updates on our key expertise priorities. While Ruben will provide additional details on our financial results. We delivered double-D adjusted EBITDA growth in the first half of 2025. These results were restrained by the significant increase in oil chemicals for material prices, which impacted surfactant margins. We are planning to recover our margins gradually going forward. The company reported second quarter adjusted EBITDA of $51.4 million, up 8% versus the prior year. Polymers delivered double-D adjusted EBITDA growth. Surfactant adjusted EBITDA was similar to last year, driven by excellent growth in our crop productivity business, fully offset by significant raw material inflation. Specialty product adjusted EBITDA was impacted by order timing changes, and the business continues to deliver solid growth. Volume grew 1%, with polymers up 7% and our MCT product line up 49%, while surfactant's volume was down 1%. We continued to experience double-digit volume growth within the crop productivity and oil field end markets, which was offset by lower demand within the global commodity consumer products end market. North America and European rigid polymers volume grew low single digits, while the commodity PA business continues to deliver strong growth year over year. We believe that rigid polymers growth in North America and Europe continues to be restrained by global macroeconomic uncertainties and the high interest rate environment. We remain encouraged by the volume growth across several of our key strategic end markets. We finished the second quarter of 2025 with $12 million of adjusted income, up 27% versus the prior year, driven by earnings growth in polymers and crop productivity, as well as a lower tax rate. Production at our new Pasadena DEXA site is ramping up and should provide incremental benefits in the second half of the year. During the second quarter of 2025, the company paid $8.7 million in dividends to shareholders. Our board of directors declared a quarterly cash dividend on a Stepan stock of .38.5 per share, payable on September 15, 2025. Stepan has paid an increased dividend for 57 consecutive years. Brewing will now share some details of our second quarter results. Thank you Luis.