Stepan Company

Good morning and welcome to the Stepan Company third quarter 2026 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, press star 1-1 again. As a reminder, this call is being recorded on Wednesday, October 28, 2026. It is now my pleasure to turn the call over to Mr. Ruben Velasquez, Senior Vice President and Chief Financial Officer of Stepan Company. Mr. Velasquez, please go ahead.

Thanks, Sherry. Good morning and thank you for joining Stepan Company's Third 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 filings. 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 investor sections 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 third quarter 2026 results. I will share the highlights of the quarter and an update on our key strategic priorities, while 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 of everything we do at Stepan. Our safety performance over the last 12 months remains strong. The third quarter was another quarter of earnings growth for Stepan. The three segments delivered organic volume growth and increased earnings versus the prior year. Adjusted EBITDA was $66 million, up 18% versus the prior year. Driven by global volume growth, margin recovery, and project catalyst savings. To the fact that adjusted EBITDA was up 27%. Polymers grew single digits, including one-time maintenance turnaround costs at our Germany site. And specialty products grew EBITDA single digits, driven by double-digit volume growth. On a consolidated basis, adjusted earnings per diluted share were 94 cents, nearly double the prior year. Now, I want to highlight a few elements of our third quarter performance. First, volume growth. Organic volume grew 7%, with growth in all three segments. Sulfactant organic volume was up 8%, and the growth was broad-based across most of the end markets. Polymers volume was up 3% with North America growing strong double digits. And specialty products delivered 20% volume growth behind a strong innovation plan in our MCT product line. We are pleased with the growth we achieved in several of our key strategic end markets, despite ongoing global economic uncertainties and supply chain disruptions. Second, margin recovery and pricing discipline. Raw material costs continues to increase in a volatile environment, including the disruption related to the Middle East conflict. Our pricing actions, together with our disciplined execution of our contractual pass-through mechanism, offset those higher costs. Third, productivity and cost-out. Project Catalyst continues to deliver savings, and we are now projecting to exceed the 60% target for 2026. Finally, we remain focused on cash generation and balance sheet deleveraging. Our net leverage improved to 2.4 times. Free cash flow was positive at $8 million despite a further investment in working capital. In October, we closed the sale of a parcel of land near our mill sales site for $28.5 million. The full cash proceeds will be used to pay down debt and continue to deliver the balance sheet in November. Through the first nine months of the year, adjusted EBITDA is up 15% and adjusted earnings per share are up 40% versus the prior year. We remain committed to a balanced approach to capital allocation. During the quarter, we continued to invest in working capital, we executed our capital plan across our site, and we paid $9 million in dividends. Finally, we increased our quarterly dividend by $0.01 per share, or 2.5%, marking the 59th consecutive year that Stepan has increased his dividend. With that, I will turn the call back to Ruben to walk you through the financial details for the quarter. Thank you Luis.