What changed in this filing

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Item 1. Financial Statements

2026-05-06 compared with 2025-11-05 · 120 added, 223 removed, 473 unchanged (42% of the section changed)

4 unchanged sentences

Three Months Ended

September 30,

Nine Months Ended

September 30,

Cost of Sales

2 unchanged sentences

Research, development and technical services

Deferred compensation expense

Operating Income

Deferred compensation (income) expense

Business restructuring (Note 16)

Operating Income (Loss)

Other Income (Expense):

1 unchanged sentence

Other, net (Note 15)

Income Before Provision for Income Taxes

Income (Loss) Before Provision for Income Taxes

Provision for Income Taxes

Net Income Per Common Share (Note 10):

Net Income (Loss)

Net Income (Loss) Per Common Share (Note 10):

Shares Used to Compute Net Income Per Common Share (Note 10):

4 unchanged sentences

Three Months Ended

September 30,

Nine Months Ended

September 30,

Net Income (Loss)

Other Comprehensive Income (Loss):

2 unchanged sentences

Derivative instrument activity, net of tax (Note 11)

Total Other Comprehensive Income (Loss)

Comprehensive Income

Total Other Comprehensive Income

Comprehensive Income (Loss)

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these financial statements.

2 unchanged sentences

(Dollars in thousands)

September 30, 2025

March 31, 2026

December 31, 2025

5 unchanged sentences

Total current assets

Assets held for sale (Note 17)

Property, Plant and Equipment:

12 unchanged sentences

Total current liabilities

Liabilities held for sale (Note 17)

Deferred income taxes

16 unchanged sentences

(In thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash Flows From Operating Activities

Net income (loss)

Adjustments to reconcile net income to net cash

1 unchanged sentence

Depreciation and amortization

Deferred compensation

Realized and unrealized gains on long-term investments

Deferred compensation (income) expense

Realized and unrealized loss on long-term investments

Stock-based compensation

Deferred income taxes

Business restructuring

Other non-cash items

12 unchanged sentences

Revolving debt and bank overdrafts, net (Note 14)

Other debt borrowings (Note 6)

Other debt repayments (Note 6)

Other debt repayments

Dividends paid

11 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025

March 31, 2026

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1 unchanged sentence

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) have been condensed or omitted pursuant to such rules and regulations, although management believes that the disclosures are adequate and make the information presented not misleading.

In the opinion of management, all adjustments, consisting only of normal recurring accruals, necessary to present fairly the Company’s financial position as of September 30, 2025, its results of operations for the three and nine months ended September 30, 2025 and 2024 and cash flows for the nine months ended September 30, 2025 and 2024, have been included.

In the opinion of management, all adjustments, consisting only of normal recurring accruals, necessary to present fairly the Company’s financial position as of March 31, 2026, its results of operations for the three months ended March 31, 2026 and 2025 and cash flows for the three months ended March 31, 2026 and 2025, have been included.

These financial statements and related footnotes should be read in conjunction with the financial statements and related footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (2025 Annual Report on Form 10-K).

RECONCILIATIONS OF EQUITY

Below are reconciliations of total equity for the three and nine months ended September 30, 2025 and 2024:

(In thousands, except share and per share amounts)

Comprehensive

Income (Loss)

Balance, June 30, 2025

Issuance of 0 shares of

common stock under incentive

compensation plan

Stock-based and deferred compensation

Other comprehensive income

Cash dividends paid:

Common stock ($ 0.385 per share)

Balance, September 30, 2025

Below are reconciliations of total equity for the three months ended March 31, 2026 and 2025:

(In thousands, except share and per share amounts)

5 unchanged sentences

Stock-based and deferred compensation

Net income (loss)

Other comprehensive income

1 unchanged sentence

Common stock ($ 0.395 per share)

Balance, September 30, 2025

(In thousands, except share and per share amounts)

Comprehensive

Income (Loss)

Balance, June 30, 2024

Issuance of 1,037 shares of

common stock under incentive

compensation plan

Stock-based and deferred compensation

Other comprehensive (loss)

Cash dividends paid:

Common stock ($ 0.375 per share)

Balance, September 30, 2024

Balance, March 31, 2026

(In thousands, except share and per share amounts)

5 unchanged sentences

Stock-based and deferred compensation

Other comprehensive (loss)

Other comprehensive income

Cash dividends paid:

Common stock ($ 0.385 per share)

Balance, September 30, 2024

Balance, March 31, 2025

FAIR VALUE MEASUREMENTS

2 unchanged sentences

Fair value of cash and cash equivalents is a Level 1 measurement.

The Company's cash and cash equivalents included money market funds totaling $ 11,413,000 and $ 12,589,000 at September 30, 2025 and December 31, 2024, respectively.

The Company's cash and cash equivalents included money market funds totaling $ 18,527,000 and $ 13,807,000 at March 31, 2026 and December 31, 2025, respectively.

Derivative assets and liabilities

3 unchanged sentences

The fair value of the interest rate swap was calculated as the difference between the contracted swap rate and the floating interest rate multiplied by the present value of the notional amount of the contract.

At September 30, 2025, and December 31, 2024 , the fair values and related carrying values of debt, including current maturities, were as follows (the fair value and carrying value amounts are presented without regard to unamortized debt issuance costs of $ 303,000 and $ 404,000 as of September 30, 2025 and December 31, 2024, respectively):

The Company's fair value measurements for debt fall in Level 2 of the fair value hierarchy.

At March 31, 2026, and December 31, 2025 , the fair values and related carrying values of debt, including current maturities, were as follows (the fair value and carrying value amounts are presented without regard to unamortized debt issuance costs of $ 246,000 and $ 275,000 as of March 31, 2026 and December 31, 2025, respectively):

(In thousands)

September 30,

Carrying value

The following tables present financial assets and liabilities, excluding cash and cash equivalents, measured on a recurring basis at fair value as of September 30, 2025, and December 31, 2024, and the level within the fair value hierarchy in which the fair value measurements fall:

The following tables present financial assets and liabilities, excluding cash and cash equivalents, measured on a recurring basis at fair value as of March 31, 2026, and December 31, 2025, and the level within the fair value hierarchy in which the fair value measurements fall:

(In thousands)

September 30,

Mutual fund assets

14 unchanged sentences

DERIVATIVE INSTRUMENTS

At September 30, 2025, and December 31, 2024 , the Company had open forward foreign currency exchange contracts to buy or sell foreign currencies with U.S.

At March 31, 2026, and December 31, 2025 , the Company had open forward foreign currency exchange contracts to buy or sell foreign currencies with U.S.

dollar equivalent amounts of $ 45,805,000 and $ 57,755,000 , respectively.

All forward foreign exchange contracts at September 30, 2025 had durations of one month to three months .

All forward foreign exchange contracts at March 31, 2026 had durations of one month to three months .

The Company is currently exposed to volatility in short-term interest rates and has mitigated certain portions of that risk by using an interest rate swap.

The interest rate swap is recognized on the balance sheet as either an asset or a liability measured at fair value.

At September 30, 2025 , the Company held an interest rate swap contract with a notional value of $ 100,000,000 that was designated as a cash flow hedge.

The interest rate swap is recognized on the balance sheet as either an asset or a liability

measured at fair value.

At March 31, 2026 , the Company held an interest rate swap contract with a notional value of $ 100,000,000 that was designated as a cash flow hedge.

Period-to-period changes in the fair value of the interest rate swap are initially recognized as gains or losses in other comprehensive income.

1 unchanged sentence

The maturity date of the current interest swap contract is March 10, 2027 , which is closely aligned with the June 24, 2027 maturity of the Company's revolving credit facility.

The fair values of the derivative instruments held by the Company on September 30, 2025, and December 31, 2024, are disclosed in Note 3, Fair Value Measurements , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q).

Derivative instrument gains and losses for the three and nine months ended September 30, 2025 and 2024, were immaterial.

For amounts reclassified out of AOCI into earnings for the three and nine months ended September 30, 2025 and 2024, see Note 11, Accumulated Other Comprehensive Income (Loss) , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q).

The fair values of the derivative instruments held by the Company on March 31, 2026, and December 31, 2025, are disclosed in Note 3, Fair Value Measurements , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q).

Derivative instrument gains and losses for the three months ended March 31, 2026 and 2025, were immaterial.

For amounts reclassified out of AOCI into earnings for the three months ended March 31, 2026 and 2025, see Note 11, Accumulated Other Comprehensive Income (Loss) , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q).

STOCK-BASED COMPENSATION

2 unchanged sentences

Three Months Ended

September 30,

Nine Months Ended

September 30,

Unrecognized compensation costs for stock options, performance shares, RSUs and SARs were as follows:

(In thousands)

September 30,

Stock options

1 unchanged sentence

The change in unrecognized compensation costs for stock options, performance shares, RSUs and SARs is due to new grants issued in 2026.

The Company granted the following awards in the first nine months of 2025:

The Company granted the following awards in the first three months of 2026:

Stock options

Performance shares (at target) and RSUs

The unrecognized compensation costs at September 30, 2025 , are expected to be recognized over weighted-average periods of 1.6 years for stock options, 2.1 years for performance shares and RSUs and 2.0 years for SARs.

The composition of inventories at September 30, 2025, and December 31, 2024, was as follows:

The unrecognized compensation costs at March 31, 2026 , are expected to be recognized over weighted-average periods of 2.2 years for stock options, 2.4 years for performance shares and RSUs and 2.3 years for SARs.

The composition of inventories at March 31, 2026, and December 31, 2025, was as follows:

(In thousands)

September 30,

Finished goods

4 unchanged sentences

Three Months Ended

September 30,

Nine Months Ended

September 30,

Operating lease cost

8 unchanged sentences

for new operating lease liabilities

The following table outlines the maturities of lease liabilities as of September 30, 2025.

The following table outlines the maturities of lease liabilities as of March 31, 2026.

(In thousands)

Undiscounted Cash Flows:

2025 (excluding the nine months ended September 30, 2025)

2026 (excluding the three months ended March 31, 2026)

Subsequent to 2030

8 unchanged sentences

Weighted-average discount rate-operating leases

As of September 30, 2025 , the Company had no leases that had not already commenced.

As of March 31, 2026 , the Company had a railcars lease, valued at approximately $ 356,000 , that had not commenced.

The lease will commence during the second quarter of 2026 with a lease term of five years .

CONTINGENCIES

13 unchanged sentences

The level of annual expenditures for remedial, monitoring and investigatory activities will change in the future as major components of planned remediation activities are completed and the scope, timing and costs of existing activities are changed.

As of September 30, 2025 , the Company estimated a range of possible environmental losses and legal losses of $ 19,406,000 to $ 44,696,000 .

As of March 31, 2026 , the Company estimated a range of possible environmental losses and legal losses of $ 19,825,000 to $ 46,376,000 .

Within the range of possible environmental losses and legal losses, management has currently concluded that no single amount is more likely to occur than any other amounts in the range and, thus, has accrued at the lower end of the range.

These accruals totaled $ 19,406,000 at September 30, 2025 and $ 19,952,000 at December 31, 2024 .

In the second quarter of 2025, the Company accrued an additional $ 1,754,000 for remediation expenses at the Company's Elwood, Illinois (Millsdale) facility due to a change in the scope of planned remediation activities.

These accruals totaled $ 19,825,000 at March 31, 2026 and $ 19,272,000 at December 31, 2025.

A lthough the Company believes that its estimated range of possible environmental losses and legal losses and its reserves are adequate for contingencies, it is possible, due to uncertainties including those noted above, that additional reserves could be required in the future.

Cash expenditures related to environmental remediation and certain other legal matters approximated $ 4,030,000 and $ 2,243,000 for the nine months ended September 30, 2025 and 2024, respectively.

Cash expenditures related to environmental remediation and certain other legal matters approximated $ 301,000 and $ 2,576,000 for the three months ended March 31, 2026 and 2025, respectively.

For certain sites, the Company has responded to information requests made by federal, state or local government agencies but has received no response confirming or denying the Company’s stated positions.

3 unchanged sentences

However, in the event of one or more adverse determinations with respect to such sites in any annual or interim period, the effect on the Company’s cash flows and results of operations for those periods could be material.

Following are summaries of the Company’s major contingencies at September 30, 2025:

Following are summaries of the Company’s major contingencies at March 31, 2026:

Maywood, New Jersey Site

24 unchanged sentences

The Company is contractually obligated to contribute up to five percent of the environmental response costs incurred by the current owner, with no limitation on the ultimate amount of contributions.

The Company had paid the current owner $ 4,190,000 for the Company’s portion of environmental response costs at the Wilmington site through September 30, 2025.

The Company had paid the current owner $ 4,379,000 for the Company’s portion of environmental response costs at the Wilmington site through March 31, 2026.

The Company has recorded a liability for its portion of the estimated remediation costs for the site.

6 unchanged sentences

The notice alleges violations related to operating parameters and air emission requirements.

The notice does not state whether the USEPA intends to pursue financial penalties or operational remedies.

The alleged violations may result in a range of possible penalties;

The alleged violations may result in a range of possible penalties, including financial penalties or operational remedies;

however, at this stage of the matter, the Company is unable to predict the ultimate outcome or what impact, if any, the outcome might have on the Company’s financial position, results of operations or cash flows.

16 unchanged sentences

USEPA assessed a civil penalty of $ 1,126,000 , which the Company paid on July 2, 2025.

During the third quarter of 2025, the Company recovered $ 500,000 of the USEPA penalty from third parties and continues to pursue complete recovery.

As of March 31, 2026, the Company recovered the entire amount of the USEPA penalty from third parties.

POSTRETIREMENT BENEFIT PLANS

6 unchanged sentences

Three Months Ended

September 30,

Nine Months Ended

September 30,

Interest cost

Expected return on plan assets

Amortization of net actuarial loss

Amortization of net actuarial loss (gain)

Net periodic benefit cost

2 unchanged sentences

Three Months Ended

September 30,

Nine Months Ended

September 30,

Interest cost

3 unchanged sentences

Employer Contributions

As a result of pension funding relief provisions included in the Highway and Transportation Funding Act of 2014, the Company is not required to make contributions to its funded U.S.

qualified defined benefit plans.

Approximately $ 171,000 is expected to be paid to the unfunded non-qualified plans in 2025 .

Of such amount, $ 141,000 had been paid to the non-qualified plans as of September 30, 2025.

In 2026, the Company expects to contribute $ 910,000 to the U.S.

qualified defined benefit plans and $ 145,000 to the U.S.

unfunded non-qualified pension plans.

Of such amount, $ 29,000 had been paid to the non-qualified plans as of March 31, 2026.

The Company’s U.K.

4 unchanged sentences

retirement plans include two qualified plans, one of which is a 401(k) plan and one of which is an employee stock ownership plan (profit sharing plan), and one non-qualified supplemental executive plan.

In the nine months ended September 30, 2025 and 2024 , the Company made contributions into the qualified retirement plans for U.S.

In the three months ended March 31, 2026 and 2025 , the Company made contributions into the qualified retirement plans for U.S.

employees and for certain non-U.S.

8 unchanged sentences

Three Months Ended

September 30,

Nine Months Ended

September 30,

Retirement savings contributions

6 unchanged sentences

Therefore, the mutual funds are reported at fair value with any subsequent changes in fair value recorded in the statements of income.

The supplemental plan liabilities increase (i.e.,

supplemental plan expense is recognized) when the value of the trust assets appreciate and decrease when the value of the trust assets decline (i.e., supplemental plan income is recognized).

At September 30, 2025 , the balance of the trust assets was $ 269,000 which equaled the balance of the supplemental plan liabilities.

The supplemental plan liabilities increase (i.e., supplemental plan expense is recognized) when the value of the trust assets appreciate and decrease when the value of the trust assets decline (i.e., supplemental plan income is recognized).

At March 31, 2026 , the balance of the trust assets was $ 338,000 which equaled the balance of the supplemental plan liabilities.

See the long-term investments section in Note 3, Fair Value Measurements , of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q) for further information regarding the Company’s mutual fund assets.

EARNINGS PER SHARE

Below are the computations of basic and diluted earnings per share for the three and nine months ended September 30, 2025 and 2024:

Below are the computations of basic and diluted earnings per share for the three months ended March 31, 2026 and 2025:

(In thousands, except per share amounts)

Three Months Ended

September 30,

Nine Months Ended

September 30,

Computation of Basic Earnings per Share

Net income (loss)

Weighted-average number of common shares

1 unchanged sentence

Computation of Diluted Earnings per Share

Net income (loss)

Weighted-average number of shares outstanding

10 unchanged sentences

Diluted earnings per share

(1) Options/SARs to acquire 1,206,200 and 1,208,435 shares of the Company's common stock were excluded from the computation of dilutive earnings per share for the three and nine months ended September 30, 2025 , respectively.

(1) Options/SARs to acquire 1,213,923 shares of the Company's common stock were excluded from the computation of dilutive earnings per share for the three months ended March 31, 2025.

The options/SARs' exercise prices were greater than the average market price for the Company's common stock and inclusion of the instruments would have had an antidilutive effect on the computations of the earnings per share.

883,188 and 860,788 options/SARs to acquire shares of the Company's common stock were excluded from the computation of dilutive earnings per share for the three and nine months ended September 30, 2024 , respectively.

(2) For the three months ended March 31, 2026, potential common shares were excluded from the computation of diluted earnings per share because of their anti-dilutive effect due to the net loss for the quarter.

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Below is the change in the Company’s accumulated other comprehensive income (loss) (AOCI) balance by component (net of income taxes) for the three and nine months ended September 30, 2025 and 2024:

Below is the change in the Company’s accumulated other comprehensive income (loss) (AOCI) balance by component (net of income taxes) for the three months ended March 31, 2026 and 2025:

(In thousands)

Balance at June 30, 2024

Other comprehensive income (loss) before

reclassifications

Amounts reclassified from AOCI

Net current-period other comprehensive income (loss)

Balance at September 30, 2024

Balance at June 30, 2025

Other comprehensive income (loss) before

reclassifications

Amounts reclassified from AOCI

Net current-period other comprehensive income (loss)

Balance at September 30, 2025

Balance at December 31, 2024

3 unchanged sentences

Net current-period other comprehensive income (loss)

Balance at September 30, 2024

Balance at March 31, 2025

Balance at December 31, 2025

3 unchanged sentences

Net current-period other comprehensive income (loss)

Balance at September 30, 2025

Information regarding the reclassifications out of AOCI for the three and nine months ended September 30, 2025 and 2024, is displayed below:

Balance at March 31, 2026

Information regarding the reclassifications out of AOCI for the three months ended March 31, 2026 and 2025, is displayed below:

(In thousands)

2 unchanged sentences

Three Months Ended

September 30,

Nine Months Ended

September 30,

Affected Line Item in

16 unchanged sentences

The accounting policies of the reportable segments are the same as those described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 .

The following is segment data for the three and nine months ended September 30, 2025 and 2024, and reconciliations of segment data to the condensed consolidated financial statements:

For the Three Months Ended September 30, 2025

(In thousands)

Cost of Sales (1)

Operating Expenses (2)

Operating Income

Unallocated Corporate Expenses (3)

Consolidated Operating Income

Segment Capital Expenditures

Unallocated Capital Expenditures (4)

Consolidated Capital Expenditures

Segment Depreciation and Amortization

Unallocated Depreciation and Amortization (5)

Consolidated Depreciation and Amortization

For the Nine Months Ended September 30, 2025

(In thousands)

Cost of Sales (1)

Operating Expenses (2)

Operating Income

Unallocated Corporate Expenses (3)

Consolidated Operating Income

Segment Capital Expenditures

Unallocated Capital Expenditures (4)

Consolidated Capital Expenditures

Segment Depreciation and Amortization

Unallocated Depreciation and Amortization (5)

Consolidated Depreciation and Amortization

For the Three Months Ended September 30, 2024

following is segment data for the three months ended March 31, 2026 and 2025, and reconciliations of segment data to the condensed consolidated financial statements:

For the Three Months Ended March 31, 2026

(In thousands)

10 unchanged sentences

Consolidated Depreciation and Amortization

For the Nine Months Ended September 30, 2024

For the Three Months Ended March 31, 2025

(In thousands)

10 unchanged sentences

Consolidated Depreciation and Amortization

T he following is segment assets at September 30, 2025 and December 31, 2024, and reconciliations of segment assets to the condensed consolidated financial statements.

As of September 30, 2025

The following is segment assets at March 31, 2026 and December 31, 2025, and reconciliations of segment assets to the condensed consolidated financial statements.

As of March 31, 2026

(In thousands)

7 unchanged sentences

Consolidated Assets

(1) Cost of sales is comprised of raw material costs (including freight and shipping/handling expenses to deliver the raw materials), manufacturing plant labor expenses and other manufacturing overhead expenses, such as utilities, maintenance, depreciation, etc., that can be allocated to reportable segments.

that can be allocated to reportable segments.

(2) Operating expenses allocated to reportable segments are comprised of selling, administrative and research and development expenses.

The CODM uses operating expenses in aggregate to analyze the performance of each reportable segment.

(3) Unallocated corporate expenses are primarily comprised of corporate administrative expenses (e.g., corporate finance, legal, human resources, information technology and environmental remediation expenses), deferred compensation and business restructuring and assets impairment expenses that are not included in segment operating income and not used to evaluate segment performance.

(3) Unallocated corporate expenses are primarily comprised of corporate administrative expenses (e.g., corporate finance, legal, human resources, information technology and environmental remediation expenses), deferred compensation and business restructuring expenses that are not included in segment operating income and not used to evaluate segment performance.

(4) Unallocated capital expenditures primarily include capital expenditures related to the Company’s Northfield, Illinois location.

2 unchanged sentences

REVENUE FROM CONTRACTS WITH CUSTOMERS

As of September 30, 2025 and December 31, 2024 , the Company had $ 282,000 and $ 689,000 of contract liabilities and no contract assets, respectively.

The Company has accounts receivable financing programs under which the Company has the ability to sell eligible receivables for select customers to select banking institutions.

For the three months ended March 31, 2026 and 2025 , the Company’s cash proceeds from the sale of receivables were $ 15,618,000 and $ 34,469,000 , respectively.

Financing charges incurred from the sale of accounts receivable qualifying as sales for the three months ended March 31, 2026 and 2025 were immaterial.

As of March 31, 2026 and December 31, 2025 , the Company had $ 307,000 and $ 218,000 of contract liabilities and no contract assets, respectively.

A contract liability would typically arise when an advance or deposit is received from a customer before the Company recognizes revenue.

1 unchanged sentence

When such situations do arise, the Company maintains a deferred revenue liability until the time a performance obligation has been satisfied.

The Company recognized $ 689,000 of revenue in the first nine months of 2025 from pre-existing contract liabilities at December 31, 2024.

The Company recognized $ 218,000 of revenue in the first three months of 2026 from pre-existing contract liabilities at December 31, 2025.

In addition, during 2020, the Company recorded $ 10,709,000 of long-term deferred revenue associated with a payment received to defray the cost of capital expenditures necessary to service a customer’s future product needs.

At September 30, 2025 , $ 2,769,000 was classified as long-term and $ 2,216,000 was classified as short-term.

This deferred revenue is being recognized over the period of the contract and $ 5,724,000 of revenue has been recognized from the beginning of the contract term through September 30, 2025.

The tables below provide a geographic disaggregation of net sales for the three and nine months ended September 30, 2025 and 2024.

At March 31, 2026 , $ 1,662,000 was classified as long-term and $ 2,216,000 was classified as short-term.

This deferred revenue is being recognized over the period of the contract and $ 6,831,000 of revenue has been recognized from the beginning of the contract term through March 31, 2026.

The tables below provide a geographic disaggregation of net sales for the three months ended March 31, 2026 and 2025.

The Company’s business segmentation by geographic region most effectively captures the nature and economic characteristics of the Company’s revenue streams impacted by economic factors.

(In thousands)

For the Three Months Ended September 30, 2025

Geographic Market

North America

Latin America

(In thousands)

For the Nine Months Ended September 30, 2025

Geographic Market

North America

Latin America

(In thousands)

For the Three Months Ended September 30, 2024

For the Three Months Ended March 31, 2026

Geographic Market

2 unchanged sentences

(In thousands)

For the Nine Months Ended September 30, 2024

For the Three Months Ended March 31, 2025

Geographic Market

1 unchanged sentence

Latin America

At September 30, 2025 and December 31, 2024, debt was comprised of the following:

At March 31, 2026 and December 31, 2025, debt was comprised of the following:

(In thousands)

September 30,

Senior unsecured notes

11 unchanged sentences

of $ 0 and $ 0 for 2026 and 2025, respectively)

6.17 % (net of unamortized debt issuance cost

of $ 0 and $ 0 for 2025 and 2024, respectively)

Revolving credit facility and term loan borrowing

Debt of foreign subsidiaries

Unsecured bank debt, foreign currency

Less current maturities

Long-term debt

The Company's long-term debt financing is comprised of certain senior unsecured notes issued to insurance companies in private placement transactions pursuant to note purchase agreements (the “Note Purchase Agreements”), totaling $ 338,268,000 as of September 30, 2025 .

These notes are denominated in U.S.

5 unchanged sentences

The facility is for the sole purpose of the issuance of standby letters of credit.

As of September 30, 2025 , the Company had an outstanding letter of credit of $ 8,694,000 under the CIC Credit Agreement.

The Company maintains import and export letters of credit, and standby letters of credit under its workers’ compensation insurance agreements and for other purposes, as needed from time to time, which are issued under the Credit Agreement and under the CIC Credit Agreement.

As of September 30, 2025 , the Company had outstanding letters of credit totaling $ 4,552,000 and $ 314,700,000 of outstanding borrowings under the Credit Agreement, inclusive of an $ 85,625,000 delayed-draw term loan ($ 14,375,000 of the term loan principal has been permanently repaid as scheduled).

There was $ 116,373,000 available under the Credit Agreement as of September 30, 2025.

The Company's foreign subsidiaries had $ 2,504,000 of debt outstanding at September 30, 2025.

As of March 31, 2026 , the Company had an outstanding letter of credit of $ 8,694,000 under the CIC Credit Agreement.

Company maintains import and export letters of credit, and standby letters of credit under its workers’ compensation insurance agreements and for other purposes, as needed from time to time, which are issued under the Credit Agreement and under the CIC Credit Agreement.

As of March 31, 2026 , the Company had outstanding letters of credit totaling $ 4,860,000 and $ 338,400,000 of outstanding borrowings under the Credit Agreement, inclusive of an $ 81,875,000 delayed-draw term loan ($ 18,125,000 of the term loan principal has been permanently repaid as scheduled).

There was $ 88,615,000 available under the Credit Agreement as of March 31, 2026.

The Company's foreign subsidiaries had no debt outstanding at March 31, 2026.

The Company’s material debt agreements contain provisions which, among other covenants, require maintenance of certain financial ratios and place limitations on additional debt, investments and payment of dividends.

Based on the loan agreement provisions that place limitations on dividend payments, unrestricted retained earnings (i.e., retained earnings available for dividend distribution) were $ 267,854,000 and $ 251,953,000 at September 30, 2025 and December 31, 2024 , respectively.

Based on the loan agreement provisions that place limitations on dividend payments, unrestricted retained earnings (i.e., retained earnings available for dividend distribution) were $ 213,848,000 and $ 263,923,000 at March 31, 2026 and December 31, 2025 , respectively.

Other, net in the condensed consolidated statements of income included the following:

1 unchanged sentence

Three Months Ended

September 30,

Nine Months Ended

September 30,

Foreign exchange (loss)

Foreign exchange gain

Investment income

Realized and unrealized gain on investments

Realized and unrealized (loss) on investments

Net periodic benefit cost

BUSINESS RESTRUCTURING

In February 2026, as part of the Company's Project Catalyst, a comprehensive operational and efficiency plan, the Company’s Board of Directors approved plans to shut down the Company’s Fieldsboro, New Jersey site and decommission select assets at its Elwood, Illinois (Millsdale) and Stalybridge, U.K.

facilities during the first half of 2026.

The Company is consolidating the impacted operations into its existing network, improving its asset utilization and reducing its fixed cost basis, while maintaining ongoing supply for its customers.

Total pre-tax business restructuring expense related to the asset shutdowns was $ 65,439,000 during the first quarter of 2026.

Restructuring costs in the first quarter of 2026 included $ 62,367,000 of asset impairment charges.

The Fieldsboro, New Jersey site, Elwood, Illinois (Millsdale) site and Stalybridge, U.K site recognized $ 43,022,000 , $ 14,284,000 and $ 5,061,000 , respectively, in asset impairment charges.

The Company also recognized $ 1,817,000 and $ 1,255,000 in decommissioning and termination expenses, respectively, some of which were paid during the first quarter of 2026.

Although all restructuring charges related to the Surfactants segment, they were excluded from the Surfactant segment results and are shown on a separate Business restructuring line item in the Condensed Consolidated Statements of Income for the three months ended March 31, 2026 and 2025.

Below is a reconciliation of the beginning and ending balances of the restructuring liability:

(In thousands)

Decommissioning and Other Charges

Restructuring liability at

January 1, 2026

Expenses accrued during the period

Foreign currency translation

Restructuring liability at

March 31, 2026

The Company anticipates recognizing total restructuring expenses in the range of $ 70,000,000 to $ 80,000,000 for full year 2026.

NONCASH INVESTING AND FINANCING ACTIVITIES

Noncash investing activities included liabilities (accounts payable) incurred for property, plant and equipment expenditures of approximately $ 12,648,000 and $ 12,877,000 that were unpaid at September 30, 2025 and 2024 , respectively.

Noncash financing activities included the issuance of 134,770 shares of the Company’s common stock (valued at $ 7,945,000 ) and 118,627 shares of the Company’s common stock (valued at $ 10,617,000 ) under the Company’s equity incentive compensation plan during the period ended September 30, 2025 and 2024 , respectively.

ASSETS AND LIABILITIES HELD FOR SALE

On May 27, 2025 Stepan Company announced that its subsidiary, Stepan Philippines Quaternaries, Inc.

(SPQI), had entered into an agreement to sell SPQI's manufacturing assets located in Bauan, Batangas, Philippines to Masurf, Inc., a subsidiary of Musim Mas Holdings Pte.

The Company plans to close the sale during the fourth quarter of 2025.

The asset disposal group includes $ 8,476,000 of assets and $ 4,571,000 of liabilities.

The assets are comprised of $ 3,796,000 in property, plant and equipment (net) and $ 4,680,000 in right-of use assets (operating leases) that will be assigned at the time of closing.

The liabilities held for sale reflect $ 4,571,000 in operating lease liabilities.

These assets and liabilities all relate to the Surfactant reportable segment.

Noncash investing activities included liabilities (accounts payable) incurred for property, plant and equipment expenditures of approximately $ 9,517,000 and $ 8,132,000 that were unpaid at March 31, 2026 and 2025 , respectively.

Noncash financing activities included the issuance of 138,850 shares of the Company’s common stock (valued at $ 7,511,000 ) and 94,314 shares of the Company’s common stock (valued at $ 5,712,000 ) under the Company’s equity incentive compensation plan during the three months ended March 31, 2026 and 2025 , respectively.

RECENT ACCOUNTING PRONOUNCEMENTS

In December 2023, the FASB issued ASU No.

2023-09, Income taxes (Topic 740) Improvement to Income Tax Disclosures .

This update requires that public entities on an annual basis disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold.

In addition, the amendments in this update require the disclosure on an annual basis of the amount of income taxes paid (net of refund received) disaggregated by federal, state and foreign taxes and the amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid is equal or greater than five percent of total income taxes paid (net of refunds received).

This update requires all entities to disclose income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign and income tax expense (or benefit) from continuing operations disaggregated by federal, state, and foreign.

The amendments in this update are effective for annual periods beginning after December 15, 2024 and should be applied on a prospective basis.

The implementation of ASU No.

2023-09 will not have an impact on the Company’s financial position, results of operations and cash flow but will impact the Company’s annual income tax disclosures.

In November 2024, the FASB issued ASU No.

In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No.

2024-03, Income Statement - Reporting Comprehensive income - Expense Disaggregation Disclosures (Subtopic 220-40) .

12 unchanged sentences

2024-03 will not have an impact on the Company’s financial position, results of operations and cash flow but will impact the Company’s interim and annual disclosures related to the relevant subtopics in this update.

In July 2025, the FASB issued ASU No.

2025-05, Financial Instruments-Credit Losses (Topic 326) Measurement of Credit Losses for Accounts Receivable and Contract Assets.

This update provides public companies with a practical expedient in calculating expected credit losses on current accounts receivable and/or current contract assets arising from transactions under Topic 606, Revenue from Contracts with Customers.

The expedient assumes that the current conditions as of the balance sheet date don't change for the remaining life of the asset and also allows an entity to consider cash collection activity that occurs after the balance sheet date but before the financial statements are issued.

When developing an estimate of expected credit losses for assets to which the practical expedient is applied, an entity shall continue to adjust historical loss information to reflect current conditions to the extent that historical loss information does not reflect current conditions.

The entity would need to adopt the practical expedient first to be eligible to use it.

The amendments in this update are effective for annual periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods and should be applied on a prospective basis.

The Company is in the process of evaluating ASU 2025-05 to determine its impact, if any, on the Company's financial position, results of operations and cash flows.

In September 2025, the FASB issued ASU No.

5 unchanged sentences

The Company is in the process of evaluating ASU 2025-06 to determine its impact, if any, on the Company’s financial position, results of operations and cash flows.

SUBSEQUENT EVENT

On April 24, 2026, the Company entered into a Purchase and Sale Agreement to sell a parcel of the Company’s land near its Elwood, IL (Millsdale) site.

The agreed upon purchase price for the property is $ 30,000,000 and is subject to customary adjustments and closing conditions.

The transaction is expected to close during the second half of 2026.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements