Stepan Company

Good morning and welcome to the Stepan Company Second Quarter 2026 Earnings Conference Call. During the presentation, all participants will be in 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 11 again. As a reminder, this call is being recorded on Wednesday, July 29, 2026. It's now my pleasure to turn the call over to Mr. Ruben Velasquez, Vice President and Chief Financial Officer of Stepan Company. Mr. Velasquez, please go ahead.

Thanks, Marvin. Good morning and thank you for joining Stepan Company's second quarter 2026 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 detailed in our Securities and Exchange Commission filing. In addition, this conference call will include discussions of adjusted net income, adjusted EBITDA, pre-cash flow, net debt, and leverage-related metrics, which are non-GAAP measures. We provide reconciliations to the compatible GAAP measures in the earnings presentation and press release, which we have made available at www.stepan.com under the Investors 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 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 2026 results. I will share the highlights of the quarter and an update on our key strategic priorities, and Ruben will take you through the financial details. Before reviewing the quarter, I want to recognize our teams around the world for their commitment to safety. Safety remains our top priority and the foundation on everything we do at Stepan. That focus was evident again this quarter, as we now have delivered the strongest safety performance on record in the last 12 months. Congratulations, team! The second quarter was a strong quarter of execution for Stepan. Growth-based volume growth and margin recovery, together with initial benefits from project catalyst actions, drove significant improvement in earnings. I want to highlight a few elements of our second quarter performance. Adjusted EBITDA was $74 million, up 45% versus the prior year, with all three levers contributing to the results. First, volume growth. Organic volume grew 6% with growth across all our end markets. We're growing share in many of our strategic end markets. Second, margin recovery. The pricing actions we are implementing, together with the discipline and execution of our contractual pass-through mechanisms, contributed to margin recovery during the quarter and helped offset higher raw material costs. Third, productivity and cost-out. Project Catalyst remains on track, with savings ramping up in line with our plan. We are on track to deliver our savings commitments for the year. Looking at the consolidated results, net sales were $684 million, up 15% versus the prior year, reflecting higher selling prices, higher volume, favorable product and customer mix, and favorable currency translation. Adjusted earnings per diluted share were $1.18, more than double the prior year. Finally, we remain focused on cash generation and balance sheet deleveraging. We finished Q2 with a net leverage ratio of 2.5 times. We continued to advance the previously announced agreement to sell a parcel of non-productive land adjacent to our plant in Joliet, Illinois, subject to customary closing conditions. We were pleased with the breadth of the growth during the quarter. We also believe a portion of the incremental demand we experience in the quarter reflects some customer pre-buying in response to the geopolitical and raw material uncertainty. We are considering that potential timing effect as we plan for the second half of 2026. We remain committed to a balanced approach to capital allocation. During the quarter, we invested significantly in working capital due to the escalation of raw material costs and higher sales. We executed flawlessly our capex plan across our site. And finally, the company paid $9 million in dividends. Last year, we increased our dividend for the 58th consecutive year. With that, I will turn back the call back to Ruben to walk you through the financial details for the quarter.