SCL - Earnings call transcript Q4 2021

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Operator

Greetings. Thank you for standing by. Welcome to the Stepan Company Q4 full-year 2021 Earnings Call.

During the presentation, all participants will be in a listen-only mode. Afterwards, we'll have a question-and-answer session. Instruction]. [Operator

President this I recorded the would to Rojo, reminder, XXXX. February conference is Officer. Luis now Financial And like Vice conference a ahead. Thursday, being XXth, over Please As go Chief and to turn

Luis Rojo

you Good Company fourth-quarter review. joining and morning. for Stepan XXXX full-year And financial thank

investor including uncertainties www.stepan.com information online made to perspective Before not Whether over is encourage joining statements These detailed historical that the slide conference not issued. Exchange that And slides cause and the contains results phone, under the in but the and actual could us which we hope Commission materially, prospects are our as you you approximately in at release regional we begin, these section foreign please same We available forward-looking make to or call differ time find website. helpful. facts. have when global that of review involve this filings. Securities available operations, factors note our economic at for statements the we are limited presentation, risks Investors which the and you conditions our we and to earnings

like would with that, call Chief Mr. over to Stepan, turn Now I our Officer. to the Quinn Executive and Chairman

Quinn Stepan

for world, country, and our thank Good was another morning, all you for our and difficult our joining XXXX us year today. industry.

income material future. steps that meet better, and and mostly agility sustainable commitment, challenges, and us global team's raw significant COVID-XX to stronger, chain created requirements, our transportation allowed employee customer taking a At employee’s our As more grow and weather events, build supply impacted Stepan, while to

per Income million or Net diluted a $XXX reported reached record Our share. a $X.XX

estimated These three for record results The net adjusted also business affecting was impact totaled $XX share. million chain disruptions operating achieved or million our income of the While during our XXXX. $X.XX in our supply were despite per operations. diluted negative challenges the at a the record a $XXX.X segments income

products In decreased partially pandemic addition, the demand peak in global for offset wash end This institutional demand cleaning was product disinfection, XXXX. by higher within and versus the personal functional and markets. cleaning, impact

base our material results higher results chain those slightly availability. by reported ahead the Polymer Specialty driven were by affected acquisition. disruptions, business supply INVISTA Although impacted were results negatively but in was raw by Polymer Product of were XXXX

Our its has on quarterly of payable Stepan cash common on of XXXX. March XX a Directors declared dividend dividend Stepan's increased stock per $X.XXX XXth, years. for Board consecutive share,

$XX of and million represents shareholders share XXXX. an dividends This During our XXXX, to via returned buybacks. increase we XX% versus

to current M&A to remain authorized and previously business, allow a our and its Luis in details of our us in cash As invest diversity share ability million results. cash, return opportunities full-year few strength Directors shareholders. pursue walk repurchases. that communicated, Board of through At our and We confident I our to $XXX about this point, generate of fourth-quarter, strategic will and business, like our more another would to the

Luis Rojo

presentation. Thank you, slide generally follow will Quinn. comments the My

to X this XXXX X press XXXX. million Table $XX.X decrease the Adjusted of for $X.XX quarter Net and in of the million to quarter fourth fourth the full slide diluted GAAP Appendix income we comparable the found non-GAAP of was reconciliations can or recap Because provide presentation be the net a with is the per XX% and a adjusted versus measure, of per start release. measures X $X.XX just Let's share a share, or in quarter. diluted $XX.X Income

Specifically, of adjustment income reported to expense quarter this $X.X million. excludes net deferred compensation

plan to these operational as a with stock on our net compensation quarter corporate The we breaks increase these sale environmental numbers present year bridge fourth the the related net business of as for for the figures Because compared price, in earnings change the income, income. exclude loss the an are settled company's the discussion. also restructuring, to the items deferred quarter Because well is would the on employees. Slide movement deferred after-tax remediation last cash for and fourth from liabilities net expense the total it in Additionally, million stock and noted appreciation down here excludes our compensation X rights company building, adjusted $X.X this non-cash reserves. shows the basis.

summarize, and in benefits reimbursement. payment and the segment by are to the one-time government Polymer Millsdale and We mainly detail, specifically, more will driven quoted QX, the down XXXX Surfactants Chinese cover each insurance free but in

a institutional end market. on supply wash decreased were disruptions, Millsdale product primarily foreign disruption in primarily in are improved mix. Slide well million. that XX% the Surfactant the year. benefits. and material Effect by the industrial product translation cleaning Surfactant as $X higher growth was those effect income lower one-time payment tax margins. mainly were chain negative our $XXX was estimate XX% in implemented down personal consumer approximately of to reflects impact year. The the acquisition-related to expenses. operating continue of flat operating year income Primarily a due XXXX Volume the year. inflation, on from costs, pandemic. quarter XXXX. disinfection, X% currency X%. We price others items, XX% of tax XXXX. to prior in during Most $XX.X and product raw how Selling rate results compared peak compensation decreased prices the pass-through increased you're additional cleaning, North the customer incentive-based expenses recovering demand to X, as was solid that market, year-over-year very of of into were the Europe maintenance product to and effective This we serve $X increases due million versus quarter. to million had We for from all and chain planning of expenses decrease supply due prior This our as lower which impacted Excluding sales as functional decrease Company Corporate during operating versus to XX% growth partially this one-time by end volumes was results insurance positively favorable results America quarter in from was end year the sold strong sales and up markets, consumer volume increase and The offset sold due the last last product the last functional products, the functional two in our well as growth quarter in demand basically were for slightly expenses, versus the flat increased by recognized are products. markets. million, quarter. attributable offset the to net demand due fourth partially of American segment lower for Latin

of Now, rigid due growth increased fourth decreased Volume disruptions primarily to This Higher and Net within sales pass-through acquisition. polyol volume the Polymers XX% of is income two the to Slide quarter business the This $XXX reflects quarter XX% also INVISTA million. Polymer to prior grew to raw in mostly on the were operating decrease by material million, supply Selling at prices from costs. primarily turning contributed growth. related XX% growth $XX up chain polyol. events. demand volume non-recurrence in XXXX specialty X. XX% global year. higher the driven the the

by and the driven million a the recovery settlement XXXX Millsdale related our disruption from Europe million government. results $X the chain $X.X received acquisition. second, supply negative We quarter. event during to the increased Chinese income of estimate had impact a insurance approximately $XX a on First, the pay-tv million investor

unprecedented pandemic, results. to the Turning X, consider chain Slide record they challenge during significant despite global lever supply year, the disruptions, including full-year

Lower a $X.XX of per prior versus or per diluted year. X% diluted cleaning net as a million Surfactant operating volume disinfection, was by the wash result down from down or slightly was versus a XXX.X record, pandemic Just $X.XX $XXX personal share was in demand and income An $XXX of products The segment share. increase million, for income X% lower million the XXXX. This Polymer acquisition. flat was $XX -- polyol segment was versus $XX.X up operating grew and offset a end last peak Specialty partially of demand INVISTA result delivered operating cleaning product sold million products of and prior X% as Product by markets. million, volume in Polymer Lower higher functional income XX% The into basically XXXX. the year. institutional versus year. for income, from

one-time total in million, tax the was disruption negative full of year of chain XXXX. the our net company is basis. compared was The Lastly, Net bridge Adjusted here Specialty Slide income and offset Income. the slightly shows the earnings $XX $X increase noted million. Because the fully in breaks figures for after-tax $X noted Polymers factor To to the $XX million and during an is operating Polymers, and was Products XXXX, down by supply this estimated impact an XX impact as million, income, down benefit. XXXX, reflect

rate range strong we be to XX%, our sheet for to balance moving have Slide remains We XX, to in liquidity the expect XXXX business. the ample effective invest and the of tax in to down XX%

Slide update interest as full $XXX XX, our now very at on will million you expenditures The ratios coverage investment and year priorities. leverage Scott Beginning capital continues levels. Our strategic our had healthy XXXX [Indiscernible]. on company we of up ramp

Quinn Stepan

Luis. you, Thank

we our net experienced chain that deliver customers, XXXX income. with the supply we up managed wrap to As together we and despite challenges record

again. once delivered team Our

which the has shows XXXX homes. last pandemic and to up a -pandemic led disinfection level data declined demand XX% more in sustained cleaning, changed consumers spending time peak, consumer of Although personal are versus wash have Published levels. versus higher to pre habits their volumes year

Stepan. functional products for strategy diversification into to Our be key a priority continues

oil volume strong solutions, their America. the products we prices crop high, returns crop in continue increased on of We this our positive can capability we in acreage exports, and experienced amphoteric chemicals with Biocide impact year. optimistic Operator XX% in to future increased last meet as year, soybeans, prices and America, planted last Our to that alkoxylates drove year planted in our double-digits increased on increase protection improve oil global had rate product ensure will capacity corn higher prices Latin higher capacity We product strong from XXXX. and record investing commodity favorable are for wells. customers. coupled and our a season new certain growth, a driving as and Brazil. agricultural sequential requirements more including and lines to promote and volumes opportunities Oilfield acreage remain sulfates, North remain in exchange protect investment Oilfield the In High about for a business, cost-effective price in

and formulations. product Dioxane that As the sulfate by and regulatory discussed to a optimization million deadline. Pasadena, minor investment Alkoxylation process in of capital to the surfactants XXXX the sulfates will new cleaning Through that production meet equipment, on January of Stepan in our facility at North an a supply our regulatory drivers the either capability million previously, $XXX prepared X,X foaming we customers manufacture spending. Texas limits This American key project, to produce sulfates along used requirements. in which are byproduct with consumer meet of forecasted $XXX and be ingredients increasing previous additional manufacturing primary XXXX the is combination X,X capacity new are site with Dioxane of generated are

estimate We and start-up month expect to XXXX. break of the ground by end in next Pasadena plant

strategic are We deliver added continue focus three, these new Tier capability and our be XXXX Tier strategy. growth for will the to Company. growth to customers will investment and the during the we about a that customers serving XXXX We two us. excited continue Surfactant projects of market and future Stepan

capabilities -- fermentation reach program, of which customers made We commercialization invent continue We interface and around year progress world. enhancing is Rhamnolipids. development last and our to to focused in in digital customer the these invest the our on good

We excited market including in level are the about bio-based materials, interest of Surfactants.

scale We this to begin in complete produce line our year. located This Louisiana, we program modifications future. process commercial at fermentation commitment year our and to acquired works development in sustainable with last engineering design which to and a is Rhamnolipids plant expect required more

companies managed And the our sustainability Company we XXXX, Wall rating top successful Journal the that most in the from were initiatives, pleased to we improving recognized in gold. in As advance Stepan in XXX Street were within XXXX, silver we to EcoVadis world. sustainably continue

to the recommended work consulting implementing at accelerated improve productivity, on We and Millsdale complete, increase Our and expense capacity. investments in XXXX are to both is we CapEx changes. during and now focused

disruption following expect We the a see despite in performance years. efforts year our chain these good the supply had Polymers to during of benefits significant and

Scott Behrens

challenges. and $XX both from The all business delivered The EPS by EBITDA team and we acquired to accretive done the integration margins. EBITDA our million more acquisition of was was INVISTA in of than XXXX.

INVISTA legacy Stepan's capabilities range the investing of a product sites and both at produce portfolio. are We add capacity production to to of the broader bottleneck to

pursue of that and for our to strength our turn addition offerings platform the that the of broaden identify we closing acquisition customers. back our I continue can plan strategy call to sustainable new of Given portfolio growth and now opportunities comments. balance including align sheet, diversification our with the chemistries Quinn for to will

Quinn Stepan

Thank The earnings delivered XXXX. Scott. company in you, record

Looking will that strong. to believe remain will ahead But company for same impacted to of we many continue our our XXXX. challenges in face, XXXX, operations products demand the the

In disinfection, within volumes peak to Surfactants. segments, will and hope the terms not lab cautiously We about of we consumption will XXXX are cleaning of believe personal grow products optimistic the wash XXXX. return of versus pandemic

to markets oil cleaning commodity institutional The long-term Polymer due continue volumes increase, attractive. industrial Surfactant as and prospects technologies. grow prices to for business remain Stepan new field expect and within We economies higher to open. demand agricultural the should our and

expect building energy conservation to stringent codes. efforts more demand linked and We stronger

Additionally, provide installation the bill for we industry. new believe U.S. tailwinds infrastructure that should the

we cost. January, using our production and site polymers rates in at are network at we customers the and global Millsdale higher Carolina Wilmington, majeure. products are our However, had including experienced to at force we inquired unfortunately, INVISTA, reduced declare challenges Millsdale, to producing Polymer At we albeit unit and our deliver to North in

cost, to as underlying polymer expect year-over-year. good we results another remains we are We production March. our We Despite will demand optimistic first-quarter improve supply and full higher as in prices, believe sourcing continued material well and chain segments across early higher Specialty raw delivering most about market anticipate business issues our strong Product year. resume slightly

we to extremely completed technologies, third to its that have has shareholders, the created customers, his from those business acquisitions mission our am commitment our only portion prepared of a into CEO be Under I will to future. next This has for Finally, and today's and and Company that are market the but of you, you like I'm for At over diversified an grow family Scott, our delivered employees, us turn announcing remarks. our the today the to founding we to I my and contributed future suited have Stepan ensure lead us how employees No the will call can value better innovative, XXXX. world serve around questions. to Scott been sustainable am success. retirement results. of pleased the honor multiple concludes not of our please our allowed April results. one time, this effective would grateful privilege has presence, for CEO. we unwavering Stepan instructions record have XXth, leadership, to review delivered which the the It question Company. Stepan we as whose proud is call.

Operator

Research Partners. do have from you. with Seaport ahead, lines open. Thank We [Operator Instructions]. Harrison Please a Mike question go

Mike Harrison

retirement Quinn in announcement. and Scott and Good the the on morning, congratulations promotion, Hi. Mr.

Scott Behrens

Mike. you, Thank

Quinn Stepan

you, Mike. Thank

Scott Behrens

We're both so welcomed to that.

Mike Harrison

inflationary different trying you get a supply more worsen into gave production much across total $X limited is QX? you cost bit other give QX understand better, in impacts little raw how price segments. they from to the little of first How wondering year? to material maybe some of as issues the Or impact fourth-quarter. chain if or is half of that those availability, the color Understood. getting could what Trying disruption Are lag. on we to inefficiencies? related understand, it and and bit the disruption actually much million we're Was A can the in the

Luis Rojo

the Look, getting for all to Mike details. This is the not Thanks, specific Luis. I'm question. Thanks.

impact number more on and the the on can this QX of total is imagine, you for impact importantly a XXXX. broader As

and I my the units. pretax of total mentioned in availability, So, because -- a of on remarks, inject in of marketplace gave basis I income chain $XX supply by lack as that million raw because business in all numbers the in the disruption we around logistics, operating availability, saw material was

impact to prevented it's sizable a further grow even us So, our So, that business.

pricing. the -- goods inflation volume perspective at XX% when if little at is cost up let you our numbers, more you sold bit and a look you on X%. are But If of give me, up look

raw So, XX%. good very as you job have north And significant a materials north XX%, done and our in in in of seeing inflation of have we're numbers, pricing logistics managing our seen mix. our we

closed in in quarter we XX% the in QX, XX% but quarter, So, year mix, QX, XX% price with right? XX% XX% Improvements QX. in [Indiscernible]. QX, after

will trying all pricing very The do can of we're XX%, between dual with that a you inflation a has a So have recover cost pricing, team but as seeing job to lag and the good is on mixed. for on the the -- $XXX margins. million math, working with and and from We're team, working we in mix. gradually pleased and mix our working the and pricing pricing to the productivity continue will performance done improve

Quinn Stepan

within touch some a could Raw that the through gradual problematic oxide first we're still to But dealing chain propylene has we're would raw there's is States of I that supply availability, us that say whole with. the talking be I improved. our the If issue but are with customers, and will dealing our today. we year. facing issues availability. regard improvement that on that that our and availability, a some fatty material And big there with in still in The United business suppliers significantly issue universal this it's transportation are still are anticipate other and There half is issue present. is with, the and generally with Surfactant materials that materials raw acid still

Mike Harrison

I guess guys just I that on FIFO color a you would all there, run follow-up So appreciate I the inventory. as Luis, ask

in the going raw asking I'm for or is seen already QX peak raw be the material to we So, materials run have P&L costs? I peak QX guess through

Luis Rojo

We broad and North. of have going materials course basket of are a raw some

don't at in trying to the Some lube $XX, I already is we're peak stabilize, but think yet. so are oil

Now, plus the QX, in think we're I yet. XXXX, slope slope of and the right? the XX% saw $XX, But that QX, The the the average of for significantly don't above increase increases adding that has in slope now. with oil significantly QX, we changed, is lower of big

Mike Harrison

appreciate that. I Alright,

of to there a changes In facility How and of is you lower with some our at work on recommended also now, Millsdale talk it declaring the what facility, expects that being are terms much majeure. about rates XXX% disruption force you mentioned production now, your implemented, the operating and be? based consultants? Can versus that

Scott Behrens

Yes. Thanks.

as So, disruption we we're production power caused getting from January are back in mentioned damage online. at Today, the rates in at early experienced subsequently our supply getting back earlier. half that March full running process global Polymer plant a by site networks Quinn of about the Quinn And capacity we're as mentioned to which our to supplementing Xst. earlier, but

handle that And we think be the list March, that so So get QX. working work starting back once on in seeing we'll future. QX. to will reliability have will the that $X commence in, a early is we get rates the million production of be impact can we to blips in up full we in power to units what items $X long in we

Luis Rojo

$X Scott just In million QX, basis. $X 'XX, on mentioned is the pretty a dark that to

Mike Harrison

a questions. Perfect. of That's quick And very couple helpful. then

variability tax XX% bit few tax jumped saw the on higher quite seems rate? past causes what your a it's guidance in Luis, the the XXXX, than is years. you around the the It First like all, of rate, in

Luis Rojo

Great Mike. Yeah. Question,

few years some opportunity [Indiscernible] the in have last and the projects to had XXXX. We in especially tax deliver

rate at you average U.S., of around look an U.S., country our And is average many to at in tax for if of outside the tax XX look of the tax the you XX%, an rate get mix XX%. rate you state XX%. the If companies plus

TAVRis in last between we We on of XX% we ago. to year Brazil our opportunity worked So rate. tax that normal years that's acquisition our roughly a XX%, few did tax did had We the projects. emerge as

the law Brazil, amortize for know you If goodwill the can in purposes. you tax

one-time that in So nice a help XXXX. provided

we have don't this we that between -- at envision will of which those looking type normal of expecting any rate going any tax But don't projects not our we're reduce in opportunities. XX% continue for project and to we is XX%. point, XXXX, critical So, is

Mike Harrison

business million fourth expectations And maybe on your it quarter know you the a what then in relative curious And you. chance is do All in since a to but to QX? acquired the did for I Thank it. also revenue revenue said I full-year year comment roughly right. INVISTA. give contribution you was you performing on that from a about $XXX how

Luis Rojo

Yes, we provided XXX. a

the we know, XX you in business for had XXXX. As months

can has the easily is of you per it's seasonality. that $XX mean, QX seasonality, see you the know the So, year that business lowest I this million around But right? in month. typically quarter

number. So, I'm give the to not going you exact

million, You can the $XX that imagine below average. normal is below

Quinn Stepan

were world. would ahead we're the we plan. the EBITDA of in guys say, pleased multiple contribution with X basis, start, pleased which, you the We right years, we're it's that it's business put excess business effort That basically increase ahead the years, the million delivering our on our employees very right? XXXX. of by supply very like network. of at able and of integration X.X us as X the I efficiency The improve basically in of our and X.X volumes European integrated The $XX we're overall after the first to of underlying that with chain our growth, of target, margins promise the an We the generated to early market into and year. around a result

Mike Harrison

much. Alright, thanks very

Quinn Stepan

Thanks, Mike.

Operator

Our Vincent ahead. please next from with go question Stifel, is Anderson

line open. is Your

Vincent Anderson

hear Can me, Thanks. you okay? Yeah.

Quinn Stepan

Good Yes. morning.

Vincent Anderson

completely. we expect going of products your [Indiscernible] care when away I walk of Quinn Both. the Good just But hair you're I'm line skin not Congratulations can career. imagine your morning. phase and you as go, Scott. let And enter I'll can't Mike. to Quinn, to and sure next

year, customers. your margins be for impact between expectations and So that X, And or Surfactants sorry. most on this impacting Maybe destocking a your then and might broader bit granularity next Tier more say. mix Tier concentrated year X how X I Tier on should was where

Scott Behrens

we XXXX was centered soap. hand both Scott. Yes. applications. Thanks used I'd liquid the Vincent, in that home industrial really in and for this area say disinfection was destocking is products biocides The other experienced in in around

in market equally. XXXX, that store Where will think had available X in I were and ourselves XXXX XXXX. we'll shelves the a that the be we supply that, as cause, and XXXX, in be of as I customers and XXXX. the we've chain we did I flushed saw the as earlier worked Quinn's been will So, -pandemic not levels, most system, but And X high that that in see volumes the has in forward. above in demands both inventory Tier to we're impacted see as say all we myriad of point, hopeful witnessed fat normal believe through spot that the pre we which products going through think, Tier X, Tier and Into more

Vincent Anderson

Surfactants. thanks. Okay. functional over Switching to That’s helpful,

how Just given of own broad you XXXX? and curious willing kind of the us to field, if your are share there oil and that those measure with volatility performance Ag heading into targets inherent I any markets, end was like be you'd areas in

Scott Behrens

No.

that markets more are on say these volatile. it Ag. volatile hit the than I'd You Oilfield head winds obviously

bullish need volatile. obviously, production for and continued with more demand protection a are a taking undertones forward. going to You Oilfield market the tailwind do the is really crop fuels with feed for good There planet products. renewable in have larger the underlining crop trend stage

of, say how of forward, terms in not that's space. in us a is the products in look marketplace. developed. it terms terms are -- R&D registration fully the Ag the fairly it's one I for three tracking key after formulate pesticide would Generally, our efforts any helping going interface we of them in those for by is metrics within the lag I science at at We're the two wins our What to closely means. think years products forecast customer of next-generation there's that

would anticipated or to our that a terms the be carry is is customers have out, product launches wins. our So, of our R&D one And we activities metrics that internal of growth product those we impacted of in years. remain next protection key about over is by crop business result and you previous of launches optimistic going how window anticipated tell do the in what a segment couple and as those I we

Vincent Anderson

And pretty wins was head do recall of of of we that great. that reaching That's my -- into point, pretty into that I leading Ag the was be a a you for substantial couple window confident should Are registration years as the you're of end kind next couple you actually, reporting business, that saying we XXXX? which ago.

Operator

as And moment begin. brief reconnect. One reconnected. we now we're We may

Scott Behrens

dropped Sorry in about pipeline. sure I'm you that. last Do some another believe but, where guy. and have I have new our that exactly items It it off must left question? Vincent, we as on No, back we've connection saying, we lost we're be the think line. we not was I was

Vincent Anderson

hear Can Yes. me? still you

Scott Behrens

Yes.

Vincent Anderson

answer Alright. last Perfect. does question. yeah, that the Well

at these They dry whole requirements? cleaning all And not over meaningful Surfactants right bit come like by are products appears if house the lot products sales of And now. used revolve yet? attractive laundry so, your my noticing footprint strips. or on any Have ship like a I've their being surface this any sold more up so, for a represent the more dried me, in and having last environmental they radar home been change directly form in re-hydrated more cleaners of either consumer one's from anecdotal, in one but detergent are form that these to And pitch water. around do to a these

Scott Behrens

Yes.

of today, sustainability obviously push. world would water There great is from say and a around shift this the lot So, a is products. Vincent. consumer question I a of lot

Surfactants and shelf. use. solid our the them are we So towards within their have So, a to in getting line we formulations Stepan, is, great way is scope emissions then use three on product product working around for store help highly at product with have portfolio sustainable and product to a concentrated consumer reduction Surfactants, Surfactant concentrated due consumer a more the and journey to companies,

Vincent Anderson

caveat, So that sulfonates to we powdered helpful. this we a can still facilitates optimal We formulations? line that the school to laundry water dry just for back used a If use completely old going new determined ask detergent was and supply. Are is product not I that or just this in that's though. our process,

Scott Behrens

That balance. is from don't I detergents as not is an think us perspective. their attractive a other going I and environmental powdered -- processing see to back there's footprint technology

Vincent Anderson

producing other product processing technologies alternative concentrated or alternative for some highly that new and consumer forms detergent? have solid companies of

Quinn Stepan

Yes.

is today's in was So, more actively low, much pods talking strips traditional that frankly, quite formulated. or powders very you're are -- the ingredient active about and

Vincent Anderson

again, Alright. best And Quinn very Okay? Thanks luck to of Scott. much.

Scott Behrens

Thank you.

Operator

And Rodriguez Please from with Markets. have Capital your question lines a we Stonegate Marco open. ahead, go

Marco Rodriguez

you to I question. have my [Indiscernible] taking a follow-up. want I thank quick for

just if on seen this expensive? able don't well? -- First the being that. labor availability chain maybe find a guys the was provide I of supply little comment obviously can that know if you to then more may but saw, you regard disruptions issues. called Is I on have being any out that can And transportation bit you issue too can you I missed truck, there wondering trucks as off, function you impacts to you in color if not a

Scott Behrens

disruption is Marco. transportation, the the regards impacting that's levered availability of With drivers. Thanks, largest to the

For it's these hazardous chemical industry especially this transportation. shipments, hazardous

the across hear anticipate. anyone gap take U.S. significant than So, think I a ability Marco, American than longer been XX,XX close And the driver shortage. or initially marketplace. there us? greater to number's to That is published North is going you the that can that

Marco Rodriguez

Yes.

Scott Behrens

Okay.

So, availability, in it's driver issue. not a it's equipment

throughout relatively a ability -- remained our -- attrition and terms produce customers. of it the perspective impact from we're pandemic our with don't Stepan's from labor, impacting not rates impacted have ourselves is to and In labor low service we our not

Marco Rodriguez

go in the then can prices of you the margin in recover Got this you've it. how prices you raw continuing And increases that with thinking think then comment And lag, past. to future? to customers, in through potential terms can been -- increasing do material mentioned it price obviously the that quarter? the about obviously those pushing pay from little are expectation up, are is you before the bit you you last When a about a there's which your

Luis Rojo

would model Marco, situations built raw when this and material it up that into say goes the is when raw in goes is I business material pricing What has Luis. down. both

adjusting on prices record So, the our have a good environment. track we depending of

I before, significantly raw peak the in and we will XXXX. material and XXXX. don't slope to in be are believe we diligence that both lower require going are than mentioned yet of I the more As think on pricing pricing But

volume. that we between continue on will So, doing these customers thing the talk a right want adjust pricing the pricing basis, we raw material with we right? -- and and prices weekly having and will continue so all and balance I we right to monitor and our margins, mean,

continue making all at the sure So, looking that deliver variables. we those we return end will maximum the at

Marco Rodriguez

then on I And quick cleaning if was for last surrounding disinfecting. color more commentary provide Understood. me, maybe question bit just you your a can wondering little and

fiscal the growth. year, some see near in and the maybe obviously growth Can to optimistic you You've side is confidence this there? continue to provided is also talk side, cleaning about somewhat guidance just new those driving consumer expected cautiously what your but expectations of you're expectations might institutional expectation is level see where that

Scott Behrens

material and do outside are first hand to expect throughout year. We levels want market of raw I point foremost, most and would the I and probably across the say in inventory would say, improve where below at this in time. general, we would companies them liquid believe availability biocides soaps

get we the half in So, and some we underlying could can improvement of be is transportation demand the the the hopefully, on and If there. year, shortages, see second the reduce that think through can raw demand we think of availability material there.

Marco Rodriguez

it. guys, appreciate your very for much time. I you, Thank Understood.

Quinn Stepan

Thank you, Marco.

Operator

there And at this no are questions time. Instructions]. further [Operator

Quinn Stepan

have us a Okay. the thank I joining Company. today's your Stepan much and very you is the day. is ready, great Scott my in good yet confident Well, ready. investor Company is to for and on that that is call. hands am This is call. team best Thank you come for last

Operator

That for your call for today. concludes the Instructions] thank [Operator participation. We you

Stepan (SCL) 17 Feb 222021 Q4 Earnings call transcript