0001564590-21-024695 | 10-Q | XBRL Viewer

Foreign currency translation adjustments (Note 11)

$ 40,611

$ 27,539

Other Comprehensive Income:

^[1]

(18,441)

(41,195)

Defined benefit pension adjustments, net of tax (Note 11)

874

808

Derivative instrument activity, net of tax (Note 11)

(2)

Total Other Comprehensive Income

(17,569)

(40,389)

Comprehensive Income

23,042

(12,850)

Comprehensive Income Attributable to Noncontrolling Interest (Note 2)

Comprehensive Income Attributable to Stepan Company

$ 23,050

$ (12,831)

[1]	Includes foreign currency translation adjustments related to noncontrolling interest.

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Current Assets:
Cash and cash equivalents	$ 150,692	$ 349,938
Receivables, net	380,649	301,318
Inventories (Note 6)	235,062	218,783
Other current assets	31,250	35,612
Total current assets	797,653	905,651
Property, Plant and Equipment:
Cost	1,949,681	1,872,650
Less: Accumulated depreciation	(1,203,302)	(1,189,983)
Property, plant and equipment, net	746,379	682,667
Goodwill, net (Note 17)	96,252	27,972
Other intangible assets, net (Note 17)	66,813	24,068
Long-term investments (Note 3)	30,212	30,652
Operating lease assets	72,157	62,421
Other non-current assets	18,473	18,905
Total assets	1,827,939	1,752,336
Current Liabilities:
Current maturities of long-term debt (Note 14)	87,525	37,857
Accounts payable	264,192	236,750
Accrued liabilities	112,372	141,947
Total current liabilities	464,089	416,554
Deferred income taxes	29,876	20,745
Long-term debt, less current maturities (Note 14)	160,847	160,812
Non-current operating lease liabilities	60,433	51,567
Other non-current liabilities	108,748	114,293
Commitments and Contingencies (Note 8)
Equity:
Common stock, $1 par value; authorized 60,000,000 shares; Issued 26,725,620 shares in 2021 and 26,658,032 shares in 2020	26,726	26,658
Additional paid-in capital	209,471	206,716
Accumulated other comprehensive loss (Note 11)	(154,442)	(136,881)
Retained earnings	1,057,579	1,023,829
Less: Common treasury stock, at cost, 4,208,867 shares in 2021 and 4,185,242 shares in 2020	(137,052)	(133,629)
Total Stepan Company stockholders’ equity	1,002,282	986,693
Noncontrolling interests (Note 2)	1,664	1,672
Total equity	1,003,946	988,365
Total liabilities and equity	$ 1,827,939	$ 1,752,336

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2021	Dec. 31, 2020
Statement Of Financial Position [Abstract]
Common stock, par value	$ 1	$ 1
Common stock, shares authorized	60,000,000	60,000,000
Common stock, shares issued	26,725,620	26,658,032
Treasury stock, shares	4,208,867	4,185,242

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Cash Flows From Operating Activities
Net income	$ 40,611	$ 27,539
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	22,060	20,023
Deferred compensation	2,694	(7,323)
Realized and unrealized (gains) losses on long-term investments	(534)	3,875
Stock-based compensation	2,539	1,202
Deferred income taxes	2,481	131
Other non-cash items	(40)	395
Changes in assets and liabilities:
Receivables, net	(63,243)	(30,767)
Inventories	(7,476)	(447)
Other current assets	(861)	(3,180)
Accounts payable and accrued liabilities	(9,377)	(16,583)
Pension liabilities	(451)	(236)
Environmental and legal liabilities	(21)	(947)
Deferred revenues	(80)	(157)
Net Cash Used In Operating Activities	(11,698)	(6,475)
Cash Flows From Investing Activities
Expenditures for property, plant and equipment	(37,632)	(33,202)
Asset acquisition (Note 17)	(3,503)	(2,040)
Business acquisition, net of cash acquired (Note 17)	(184,000)
Other, net	1,379	2,331
Net Cash Used In Investing Activities	(223,756)	(32,911)
Cash Flows From Financing Activities
Revolving debt and bank overdrafts, net	49,668
Dividends paid	(6,861)	(6,202)
Company stock repurchased	(989)	(7,243)
Stock option exercises	381	155
Other, net	(2,272)	(1,128)
Net Cash (Used In) Provided By Financing Activities	39,927	(14,418)
Effect of Exchange Rate Changes on Cash	(3,719)	(7,240)
Net Decrease in Cash and Cash Equivalents	(199,246)	(61,044)
Cash and Cash Equivalents at Beginning of Period	349,938	315,383
Cash and Cash Equivalents at End of Period	150,692	254,339
Supplemental Cash Flow Information
Cash payments of income taxes, net of refunds/payments	6,638	3,316
Cash payments of interest	$ 2,242	$ 2,122

Condensed Consolidated Financial Statements

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

Condensed Consolidated Financial Statements

1.	CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The condensed consolidated financial statements included herein have been prepared by Stepan Company (the Company), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). 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 March 31, 2021, and its results of operations and cash flows for the three months ended March 31, 2021 and 2020, 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 2020 Annual Report on Form 10-K.

Reconciliations of Equity

3 Months Ended

Mar. 31, 2021

Reconciliations of Equity

2.	RECONCILIATIONS OF EQUITY

Below are reconciliations of total equity, Company equity and equity attributable to noncontrolling interests for the three months ended March 31, 2021 and 2020:

(In thousands, except share and per share amounts)	Total			Common Stock		Additional Paid-in Capital		Common Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Retained Earnings			Noncontrolling Interest ⁽¹⁾
Balance, December 31, 2020	$	988,365		$	26,658	$	206,716	$	(133,629	)	$	(136,881	)	$	1,023,829		$	1,672

Issuance of 5,786 shares of common stock under stock option plan		381			6		375		—			—			—			—

Purchase of 8,300 shares of common stock		(989	)		—		—		(989	)		—			—			—

Stock-based and deferred compensation		8			62		2,380		(2,434	)		—			—			—
							—
Net income		40,611			—		—		—			—			40,611			—

Other comprehensive income (loss)		(17,569	)		—		—		—			(17,561	)		—			(8	)

Cash dividends paid:
Common stock ($0.305 per share)		(6,861	)		—		—		—			—			(6,861	)		—
Balance, March 31, 2021	$	1,003,946		$	26,726	$	209,471	$	(137,052	)	$	(154,442	)	$	1,057,579		$	1,664

(In thousands, except share and per share amounts)	Total			Common Stock		Additional Paid-in Capital		Common Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Retained Earnings			Noncontrolling Interest ⁽¹⁾
Balance, December 31, 2019	$	892,496		$	26,493	$	193,135	$	(114,139	)	$	(136,170	)	$	922,464		$	713

Issuance of 2,747 shares of common stock under stock option plan		155			3		152		—			—			—			—

Purchase of 89,225 shares of common stock		(7,243	)		—		—		(7,243	)		—			—			—

Stock-based and deferred compensation		1,116			45		2,374		(1,303	)		—			—			—

Net income		27,539			—		—		—			—			27,545			(6	)

Other comprehensive income (loss)		(40,389	)		—		—		—			(40,376	)		—			(13	)

Cash dividends paid:
Common stock ($0.275 per share)		(6,202	)		—		—		—			—			(6,202	)		—
Balance, March 31, 2020	$	867,472		$	26,541	$	195,661	$	(122,685	)	$	(176,546	)	$	943,807		$	694

(1)

Reflects the noncontrolling interest in the Company’s China joint venture.

Fair Value Measurements

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements

3.	FAIR VALUE MEASUREMENTS

The following were the financial instruments held by the Company at March 31, 2021, and December 31, 2020, and the methods and assumptions used to estimate the instruments’ fair values:

Cash and cash equivalents

Carrying value approximated fair value because of the short maturity of the instruments. Fair value of cash and cash equivalents is a Level 1 measurement.

Derivative assets and liabilities

Derivative assets and liabilities include the foreign currency exchange contracts discussed in Note 4, Derivate Instruments, of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q). Fair value and carrying value were the same because the contracts were recorded at fair value. The fair values of the foreign currency contracts were calculated as the difference between the applicable forward foreign exchange rates at the reporting date and the contracted foreign exchange rates multiplied by the contracted notional amounts. See the table below that describes financial assets and liabilities measured on a recurring basis for the reported fair values of derivative assets and liabilities.

Long-term investments

Long-term investments include the mutual fund assets the Company held to fund a portion of its deferred compensation liabilities and all of its non-qualified supplemental executive defined contribution obligations (see the defined contribution plans section of Note 9, Postretirement Benefit Plans, of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q)). Fair value and carrying value were the same because the mutual fund assets were recorded at fair value. Fair values for the mutual funds were calculated using the published market price per unit at the reporting date multiplied by the number of units held at the reporting date. See the table that follows the financial instrument descriptions for the reported fair value of long-term investments.

Debt obligations

The fair value of debt with original maturities greater than one year comprised the combined present values of scheduled principal and interest payments for each of the various loans, individually discounted at rates equivalent to those which could be obtained by the Company for new debt issues with durations equal to the average life to maturity of each loan. The fair values of the remaining Company debt obligations approximated their carrying values due to the short-term nature of the debt. The Company’s fair value measurements for debt fall within level 2 of the fair value hierarchy.

At March 31, 2021, and December 31, 2020, 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 $582,000 and $617,000 as of March 31, 2021 and December 31, 2020, respectively):

(In thousands)

March 31,

2021

December 31,

2020

Fair value

259,889

210,370

Carrying value

248,954

199,286

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, 2021, and December 31, 2020, and the level within the fair value hierarchy in which the fair value measurements fall:

(In thousands)	March 2021		Level 1		Level 2		Level 3
Mutual fund assets	$	30,212	$	30,212	$	—	$	—
Derivative assets:
Foreign currency contracts		231		—		231		—
Total assets at fair value	$	30,443	$	30,212	$	231	$	—
Derivative liabilities:
Foreign currency contracts	$	196	$	—	$	196	$	—

(In thousands)	December 2020		Level 1		Level 2		Level 3
Mutual fund assets	$	30,652	$	30,652	$	—	$	—
Derivative assets:
Foreign currency contracts		335		—		335		—
Total assets at fair value	$	30,987	$	30,652	$	335	$	—
Derivative liabilities:
Foreign currency contracts	$	566	$	-	$	566	$	—

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Derivative Instruments

3 Months Ended

Mar. 31, 2021

Derivative Instruments

4.	DERIVATIVE INSTRUMENTS

The Company is exposed to certain risks relating to its ongoing business operations. The primary risk managed by the use of derivative instruments is foreign currency exchange risk. The Company holds forward foreign currency exchange contracts that are not designated as any type of accounting hedge as defined by GAAP. The Company uses these contracts to manage its exposure to exchange rate fluctuations on certain Company subsidiary cash, accounts receivable, accounts payable and other obligation balances that are denominated in currencies other than the entities’ functional currencies. The forward foreign exchange contracts are recognized on the balance sheet as either an asset or a liability measured at fair value. Gains and losses arising from recording the foreign exchange contracts at fair value are reported in earnings as offsets to the losses and gains reported in earnings arising from the re-measurement of the asset and liability balances into the applicable functional currencies. At March 31, 2021, and December 31, 2020, the Company had open forward foreign currency exchange contracts, all with durations of one to three months, to buy or sell foreign currencies with U.S. dollar equivalent amounts of $46,640,000 and $48,336,000, respectively.

The fair values of the derivative instruments held by the Company on March 31, 2021, and December 31, 2020, 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-month periods ended March 31, 2021 and 2020, were immaterial. For amounts reclassified out of accumulated other comprehensive income (loss) (AOCI) into earnings for the three-month periods ended March 31, 2021 and 2020, 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

3 Months Ended

Mar. 31, 2021

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-based Compensation

5.	STOCK-BASED COMPENSATION

On March 31, 2021, the Company had stock options, stock awards and stock appreciation rights (SARs) outstanding under its 2011 Incentive Compensation Plan. SARs granted prior to 2015 are cash-settled, and SARs granted in 2015 and later are stock-settled. Stock options and SARs granted prior to 2017 generally cliff vested after two years. Starting in 2017, stock options and

SARs have a three-year graded vesting feature, with one-third of the awards vesting each year. The Company has elected the straight-line method of expense attribution for the stock options and SARs with the graded vesting feature.

Compensation expense recorded for all stock options, stock awards and SARs was as follows:

The increase in stock-based compensation expense for the first quarter of 2021 compared to the first quarter of 2020 was primarily attributable to cash-settled SARs. The increase in cash-settled SARs compensation expense reflects an increase in the market value of Company stock during the first quarter of 2021 versus a decrease in the market value of Company stock during the first quarter of 2020.

Unrecognized compensation costs for stock options, stock awards and SARs were as follows:

(In thousands)	March 31, 2021		December 31, 2020
Stock options	$	3,780	$	1,993
Stock awards		8,674		5,313
SARs		8,176		4,341

The increases in unrecognized compensation costs for stock options, stock awards and SARs reflected the 2021 grants of:

	Shares
Stock options		66,134
Stock awards (at target)		41,228
SARs		142,451

The unrecognized compensation costs at March 31, 2021, are expected to be recognized over weighted-average periods of 2.2 years for stock options, 2.1 years for stock awards and 2.2 years for SARs.

Inventories

3 Months Ended

Mar. 31, 2021

Inventory Disclosure [Abstract]

Inventories

6.	INVENTORIES

The composition of inventories at March 31, 2021, and December 31, 2020, was as follows:

(In thousands)	March 31, 2021		December 31, 2020
Finished goods	$	156,228	$	148,878
Raw materials		78,834		69,905
Total inventories	$	235,062	$	218,783

Leases

3 Months Ended

Mar. 31, 2021

Leases [Abstract]

Leases

LEASES

The Company’s operating leases are primarily comprised of railcar, real estate, storage tank, auto, trailer and manufacturing/office equipment leases. Railcars and real estate comprise approximately 24 percent and 62 percent, respectively, of the Company’s consolidated ROU asset balance. Except for real estate, typical lease terms range from one to ten years. Real estate lease terms typically range from one to fifty years. The Company’s four principal real estate leases relate to the office lease for the new corporate headquarters in Northbrook, Illinois and land leases in the Philippines, Singapore and Lake Providence, Louisiana. As of March 31, 2021, the Company had a storage tank lease, valued at approximately $168,000, that had not commenced. This lease will commence in the second quarter of 2021 with a lease term of two years.

As most of the Company’s leases do not provide an implicit borrowing rate, the Company uses its incremental borrowing rate (IBR) based on the information available at the commencement date in determining the present value of lease payments. IBRs were specifically determined for the United States, Philippines, Singapore, Brazil and China, typically for five-year increments. The U.S. IBR was used for all other countries as the leases in these countries are not material. The total value of leases that reside in the five countries identified above represents approximately 98 percent of the Company’s consolidated

ROU asset balance. Lease cost is included in the Cost of Sales and Operating Expenses sections of the Condensed Consolidated Statements of Income.

(In thousands)	March 31, 2021
Lease Cost
Operating lease cost	$	3,726
Short-term lease cost		1,269
Variable lease cost		283
Total lease cost	$	5,278
Other Information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating leases	$	3,289
Right-of-use assets obtained in exchange for new operating lease liabilities		12,627

(In thousands)
Undiscounted Cash Flows:
2021 (excluding the three months ended March 31, 2021)	$	10,753
2022		13,081
2023		10,847
2024		6,935
2025		5,306
Subsequent to 2025		39,647
Total Undiscounted Cash Flows	$	86,569
Less: Imputed interest		(13,765	)
Present value	$	72,804
Current operating lease liabilities ⁽¹⁾		12,371
Non-current operating lease liabilities		60,433
Total lease liabilities	$	72,804

(1)

This item is included in the Accrued liabilities line on the Company’s Condensed Consolidated Balance Sheet.

Weighted-average remaining lease term-operating leases		10 years
Weighted-average discount rate-operating leases			3.0	%

Contingencies

3 Months Ended

Mar. 31, 2021

Commitments And Contingencies Disclosure [Abstract]

Contingencies

8.	CONTINGENCIES

There are a variety of legal proceedings pending or threatened against the Company that occur in the normal course of the Company’s business, the majority of which relate to environmental assessment, protection and remediation matters. Some of these proceedings may result in fines, penalties, judgments or costs being assessed against the Company at some future time. The Company’s operations are subject to extensive local, state and federal regulations, including the U.S. Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA) and the Superfund amendments of 1986 (Superfund) as well as comparable regulations applicable to the Company’s foreign locations. Over the years, the Company has received requests for information related to or has been named by government authorities as a potentially responsible party (PRP) at a number of sites where cleanup costs have been or may be incurred by the Company under CERCLA and similar state statutes. In addition, damages are being claimed against the Company in general liability actions for alleged personal injury or property damage in the case of some disposal and plant sites. The Company believes that it has made adequate provisions for the costs it is likely to incur with respect to these sites and claims.

In determining the appropriate level of environmental reserves, the Company considers several factors such as information obtained from investigatory studies; changes in the scope of remediation; the interpretation, application and enforcement of laws and regulations; changes in the costs of remediation programs; the development of alternative cleanup technologies and methods; and the relative level of the Company’s involvement at various sites for which the Company is allegedly associated. 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 March 31, 2021, the Company estimated a range of possible environmental losses and legal losses of $22,866,000 to $41,313,000. Within the range of possible environmental 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 $22,866,000 at March 31, 2021 and $22,884,000 at December 31, 2020. Although the Company believes that its reserves are adequate for contingencies, it is possible due to the uncertainties noted above, that additional reserves could be required in the future. Cash expenditures related to legal matters and environmental matters approximated $280,000 and $912,000 for the three-month periods ended March 31, 2021 and 2020, respectively. Most of the first quarter 2020 cash expenditures related to the Maywood, New Jersey site.

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. As such, estimates of the total costs, or range of possible costs, of remediation, if any, or the Company’s share of such costs, if any, cannot be determined with respect to these sites. Consequently, the Company is unable to predict the effect thereof on the Company’s financial position, cash flows and results of operations. Based upon the Company’s present knowledge with respect to its involvement at these sites, the possibility of other viable entities’ responsibilities for cleanup, and the extended period over which any costs would be incurred, management believes that the Company has no material liability at these sites and that these matters, individually and in the aggregate, will not have a material effect on the Company’s financial position. 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 March 31, 2021:

Maywood, New Jersey Site

The Company’s property in Maywood, New Jersey and property formerly owned by the Company adjacent to its current site and other nearby properties (collectively, the Maywood site) were listed on the National Priorities List in September 1993 pursuant to the provisions of CERCLA because of alleged chemical contamination. Pursuant to (i) a September 21, 1987 Administrative Order on Consent entered into between the U.S. Environmental Protection Agency (USEPA) and the Company for property formerly owned by the Company at the Maywood site and (ii) the issuance of an order on November 12, 2004 by the USEPA to the Company for property currently owned by the Company at the Maywood site, the Company has completed various Remedial Investigation Feasibility Studies (RI/FS), and on September 24, 2014, USEPA issued its Record of Decision (ROD) for chemically-contaminated soil at the Maywood site, which requires the Company to perform remedial cleanup of the soil and buried waste. The USEPA has not yet issued a ROD for chemically-contaminated groundwater at the Maywood site. Based on the most current information available, the Company believes its recorded liability is reasonable having considered the range of estimated costs of remediation for the Maywood site. The estimate of the cost of remediation for the Maywood site could change as the Company continues to hold discussions with the USEPA, as the design of the remedial action is finalized, if a groundwater ROD is issued or if other PRPs are identified. The ultimate amount for which the Company is liable could differ materially from the Company’s current recorded liability.

In April 2015, the Company entered into an Administrative Settlement Agreement and Administrative Order on Consent with USEPA which requires payment of certain costs and performance of certain investigative and design work for chemically-contaminated soil.

In addition, under the terms of a settlement agreement reached on November 12, 2004, the U.S. Department of Justice and the Company agreed to fulfill the terms of a Cooperative Agreement reached in 1985. Under the Cooperative Agreement, the United States is responsible for the removal of radioactive waste at the Maywood site, including past and future remediation costs at the site. As such, the Company recorded no liability related to this settlement agreement.

D’Imperio Property Site

During the mid-1970’s, Jerome Lightman and the Lightman Drum Company disposed of hazardous substances generated by the Company at several sites in New Jersey, including the D’Imperio site. The Company was named as a PRP in an October 2, 1998, lawsuit in the U.S. District Court for the District of New Jersey that involved the D’Imperio Site. In 2020, the PRPs were provided with updated remediation cost estimates by the PRP group technical consultant and project manager, which the Company considered in its determination of its range of estimated possible losses and liability balance. The changes in range of possible losses and liability balance were immaterial. Remediation work continues at the D’Imperio site. Based on current information, the Company believes that its recorded liability is reasonable having considered the range of estimated cost of remediation for the D’Imperio site. Depending on the ultimate cost of the remediation at this site, the amount for which the Company is liable could differ materially from the current estimates.

Wilmington Site

The Company is currently contractually obligated to contribute to the environmental response costs associated with the Company’s formerly-owned site in Wilmington, Massachusetts (the Wilmington site). Remediation at this site is being managed by its current owner to whom the Company sold the property in 1980. Under the Company’s October 1, 1993, agreement with the current owner of the Wilmington site, once total site remediation costs exceed certain levels, the Company is obligated to

contribute up to five percent of future response costs associated with this site with no limitation on the ultimate amount of contributions. The Company has paid the current owner $3,078,000 for the Company’s portion of environmental response costs at the Wilmington site through March 31, 2021. The Company has recorded a liability for its portion of the estimated remediation costs for the site. Depending on the ultimate cost of the remediation at this site, the amount for which the Company is liable could differ materially from the current estimates.

The Company and other prior owners of the Wilmington site also entered into an agreement in April 2004 waiving certain statute of limitations defenses for claims which may be filed by the Town of Wilmington, Massachusetts, in connection with this site. While the Company has denied any liability for any such claims, the Company agreed to this waiver while the parties continue to discuss the resolution of any potential claim which may be filed.

Other U.S. Sites

Through the regular environmental monitoring of its plant production sites, the Company discovered levels of chemical contamination that were above thresholds allowed by law at its Millsdale, Illinois and Fieldsboro, New Jersey plants. The Company voluntarily reported its results to the applicable state environmental agencies. As a result, the Company is required to perform self-remediation of the affected areas. Based on current information, the Company believes that its recorded liability for the remediation of the affected areas is appropriate based on an estimate of expected costs. However, actual costs could differ materially from current estimates.

Postretirement Benefit Plans

3 Months Ended

Mar. 31, 2021

Compensation And Retirement Disclosure [Abstract]

Postretirement Benefit Plans

9.	POSTRETIREMENT BENEFIT PLANS

Defined Benefit Pension Plans

The Company sponsors various funded qualified and unfunded non-qualified defined benefit pension plans, the most significant of which cover employees in the U.S. and U.K. locations. The U.S. and U.K. defined benefit pension plans are frozen and service benefits are no longer being accrued.

Components of Net Periodic Benefit Cost

	UNITED STATES						UNITED KINGDOM
(In thousands)	Three Months Ended March 31						Three Months Ended March 31
	2021			2020			2021			2020
Interest cost	$	1,177		$	1,421		$	88		$	109
Expected return on plan assets		(2,586	)		(2,437	)		(81	)		(134	)
Amortization of net actuarial loss		1,144			1,052			17			19
Net periodic benefit cost	$	(265	)	$	36		$	24		$	(6	)

Employer Contributions

U.S. Plans

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 $274,000 is expected to be paid related to the unfunded non-qualified plans in 2021. Of such amount, $119,000 had been paid related to the non-qualified plans as of March 31, 2021.

U.K. Plan

The Company’s U.K. subsidiary expects to contribute approximately $495,000 to its defined benefit pension plan in 2021. Of such amount, $141,000 had been contributed to the plan as of March 31, 2021.

Defined Contribution Plans

The Company sponsors retirement savings defined contribution plans that cover eligible U.S. and U.K. employees. The Company’s U.S. retirement plans include two qualified plans, one of which is a 401(k) plan and one of which is an employee stock ownership plan, and one non-qualified supplemental executive plan. In the three months ended March 31, 2021 and 2020, the Company made profit sharing contributions into the qualified retirement plans for U.S. employees and for certain non-U.S. employees. Profit sharing contributions were determined using a formula applied to Company earnings. In 2020 and 2021, profit sharing contributions for U.S. employees were made to the employee stock ownership plan. Profit sharing contributions are allocated to participant accounts based on participant base earnings.

Defined contribution plan expenses for the Company’s qualified contribution plans were as follows:

(In thousands)	Three Months Ended March 31
	2021		2020
Retirement savings contributions	$	2,039	$	1,758
Profit sharing contributions		1,866		975
Total defined contribution plan expenses	$	3,905	$	2,733

The Company has a rabbi trust to fund the obligations of its non-qualified supplemental executive defined contribution plans (supplemental plans). The trust comprises various mutual fund investments selected by the participants of the supplemental plans. In accordance with the accounting guidance for rabbi trust arrangements, the assets of the trust and the obligations of the supplemental plans are reported on the Company’s condensed consolidated balance sheets. The Company elected the fair value option for the mutual fund investment assets so that offsetting changes in the mutual fund values and defined contribution plan obligations would be recorded in earnings in the same period. Therefore, the mutual funds are reported at fair value with any subsequent changes in fair value recorded in the condensed consolidated statements of income. The liabilities related to the supplemental plans increase (i.e., supplemental plan expense is recognized) when the value of the trust assets appreciates and decrease when the value of the trust assets declines (i.e., supplemental plan income is recognized). At March 31, 2021, the balance of the trust assets was $2,035,000, 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).

The entire disclosure for retirement benefits.

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Earnings Per Share

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

Earnings Per Share

10.	EARNINGS PER SHARE

Below are the computations of basic and diluted earnings per share for the three months ended March 31, 2021 and 2020:

(In thousands, except per share amounts)	Three Months Ended March 31
	2021		2020
Computation of Basic Earnings per Share
Net income attributable to Stepan Company	$	40,611	$	27,545
Weighted-average number of common shares outstanding		22,974		23,023
Basic earnings per share	$	1.77	$	1.20

Computation of Diluted Earnings per Share
Net income attributable to Stepan Company	$	40,611	$	27,545
Weighted-average number of shares outstanding		22,974		23,023
Add weighted-average net shares from assumed exercise of options (under treasury stock method) ⁽¹⁾		140		102
Add weighted-average net shares related to unvested stock awards (under treasury stock method)		1		1
Add weighted-average net shares from assumed exercise of SARs (under treasury stock method) ⁽¹⁾		171		128
Add weighted-average contingently issuable net shares related to performance stock awards (under treasury stock method)		44		31
Weighted-average shares applicable to diluted earnings		23,330		23,285
Diluted earnings per share	$	1.74	$	1.18

(1) No options/SARs to acquire shares of Company common stock were excluded from the computation of dilutive earnings per share for the three months ended March 31, 2021. Options/SARs to acquire 256,288 shares of Company common stock were excluded from the computations of diluted earnings per share for the three months ended March 31, 2020. Inclusion of the instruments would have had an antidilutive effect on the computations of the earnings per share.

Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Mar. 31, 2021

Accumulated Other Comprehensive Income (Loss)

11.	ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Below is the change in the Company’s AOCI balance by component (net of income taxes) for the three months ended March 31, 2021 and 2020:

(In thousands)	Foreign Currency Translation Adjustments			Defined Benefit Pension Plan Adjustments			Cash Flow Hedge Adjustments			Total
Balance at December 31, 2019	$	(104,037	)	$	(32,205	)	$	72		$	(136,170	)
Other comprehensive income (loss) before reclassifications		(41,182	)		808			—			(40,374	)
Amounts reclassified from AOCI		—			—			(2	)		(2	)
Net current-period other comprehensive income (loss)		(41,182	)		808			(2	)		(40,376	)
Balance at March 31, 2020	$	(145,219	)	$	(31,397	)	$	70		$	(176,546	)

Balance at December 31, 2020	$	(107,083	)	$	(29,861	)	$	63		$	(136,881	)
Other comprehensive income (loss) before reclassifications		(18,433	)		874			—			(17,559	)
Amounts reclassified from AOCI		—			—			(2	)		(2	)
Net current-period other comprehensive income (loss)		(18,433	)		874			(2	)		(17,561	)
Balance at March 31, 2021	$	(125,516	)	$	(28,987	)	$	61		$	(154,442	)

Information regarding the reclassifications out of AOCI for the three-month periods ended March 31, 2021 and 2020, is displayed below:

(In thousands)	Amount Reclassified from AOCI⁽¹⁾
AOCI Components	Three Months Ended March 31						Affected Line Item in Condensed Consolidated Statements of Income
	2021			2020
Amortization of defined benefit pension actuarial losses	$	(1,161	)	$	(1,071	)	⁽²⁾
		287			263		Tax benefit
	$	(874	)	$	(808	)	Net of tax
Gains and losses on cash flow hedges:
Foreign exchange contracts		2			2		Cost of sales
		2			2		Total before tax
		—			—		Tax benefit
	$	2		$	2		Net of tax
Total reclassifications for the period	$	(872	)	$	(806	)	Net of tax

(1)

Amounts in parentheses denote expense to statement of income.

(2)

This component of accumulated other comprehensive income is included in the computation of net periodic benefit cost (see Note 9, Postretirement Benefit Plans, of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q) for additional details).

Segment Reporting

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

Segment Reporting

12.	SEGMENT REPORTING

The Company has three reportable segments: Surfactants, Polymers and Specialty Products. Net sales by segment for the three months ended March 31, 2021 and 2020, were as follows:

(In thousands)	Three Months Ended March 31
	2021		2020
Segment Net Sales
Surfactants	$	370,936	$	327,071
Polymers		150,385		106,491
Specialty Products		16,419		16,425
Total	$	537,740	$	449,987

Segment operating income and reconciliations of segment operating income to income before provision for income taxes for the three months ended March 31, 2021 and 2020, are summarized below:

(In thousands)	Three Months Ended March 31
	2021			2020
Segment Operating Income
Surfactants	$	53,210		$	36,156
Polymers		17,951			7,516
Specialty Products		2,633			3,984
Segment operating income		73,794			47,656
Business restructuring		(81	)		(357	)
Unallocated corporate expenses ⁽¹⁾		(19,799	)		(7,295	)
Consolidated operating income		53,914			40,004
Interest expense, net		(1,524	)		(1,230	)
Other, net		746			(3,262	)
Income before provision for income taxes	$	53,136		$	35,512

(1)

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

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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Revenue From Contract With Customer [Abstract]

Revenue from Contracts with Customers

3 Months Ended

Mar. 31, 2021

Revenue from Contracts with Customers

13.	REVENUE FROM CONTRACTS WITH CUSTOMERS

The Company deems a contract with a customer to exist when a purchase order is received from a customer for a specified quantity of product or products and the Company acknowledges receipt of such purchase order. In some instances the Company has entered into manufacturing supply agreements with customers but these agreements typically do not bind a customer to any purchase volume requirements and thus an obligation is not created until the customer submits a purchase order to the Company. The Company’s contracts typically have a single performance obligation that is satisfied at the time a product is shipped and control passes to the customer. For a small portion of the business, performance obligations are deemed satisfied when product is delivered to a customer location.

As of March 31, 2021, the Company had $775,000 of contract liabilities and no contract assets. A contract liability would typically arise when an advance or deposit is received from a customer before the Company recognizes revenue. In practice, this is rare as it would require a customer to make a payment prior to a performance obligation being satisfied. When such situations do arise, the Company would maintain a deferred revenue liability until the time a performance obligation has been satisfied. The Company recognized $773,000 of revenue in the current period from pre-existing contract liabilities at December 31, 2020. During 2020 the Company recognized $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. This deferred revenue will be recognized over the period of the contract. As of March 31, 2021, no revenue has been recognized from this contract.

The tables below provide a geographic disaggregation of net sales for the three months ended March 31, 2021 and 2020. 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.

	For the Three Months Ended March 31, 2021
(In thousands)
	Surfactants		Polymers		Specialty		Total
Geographic Market
North America	$	220,935	$	70,878	$	13,937	$	305,750
Europe		71,094		68,300		2,482		141,876
Latin America		60,169		990		—		61,159
Asia		18,738		10,217		—		28,955
Total	$	370,936	$	150,385	$	16,419	$	537,740

(In thousands)	For the Three Months Ended March 31, 2020
	Surfactants		Polymers		Specialty		Total
Geographic Market
North America	$	207,946	$	61,841	$	13,494	$	283,281
Europe		59,660		36,560		2,931		99,151
Latin America		46,510		639		—		47,149
Asia		12,955		7,451		—		20,406
Total	$	327,071	$	106,491	$	16,425	$	449,987

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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Other Income And Expenses [Abstract]

Debt

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Debt

14.

DEBT

Debt was comprised of the following at March 31, 2021, and December 31, 2020:

(In thousands)	Maturity Dates	March 31, 2021		December 31, 2020
Unsecured private placement notes
3.95% (net of unamortized debt issuance cost of $262 and $273 for 2021 and 2020, respectively)	2021-2027	$	99,738	$	99,727
3.86% (net of unamortized debt issuance cost of $222 and $236 for 2021 and 2020, respectively)	2021-2025		71,207		71,193
4.86% (net of unamortized debt issuance cost of $98 and $108 for 2021 and 2020, respectively)	2021-2023		27,759		27,749
Revolving credit facility borrowing	2021		45,000		—
Debt of foreign subsidiaries
Unsecured bank debt, foreign currency	2021		4,668		—
Total debt		$	248,372	$	198,669
Less current maturities			87,525		37,857
Long-term debt		$	160,847	$	160,812

The Company has a committed $350,000,000 multi-currency revolving credit agreement that expires on January 30, 2023. The Company maintains import 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 revolving credit agreement. As of March 31, 2021, the Company had outstanding borrowing totaling $45,000,000 with the weighted average interest rate of 1.36 percent and outstanding letters of credit totaling $6,767,000. There was $298,233,000 available under the revolving credit agreement as of March 31, 2021.

The Company’s loan agreements contain provisions which, among others, 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 $407,026,000 and $373,884,000 at March 31, 2021 and December 31, 2020, respectively.

Other, Net

3 Months Ended

Mar. 31, 2021

Other, Net

15.	OTHER, NET

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

(In thousands)	Three Months Ended March 31
	2021			2020
Foreign exchange (losses) gains	$	(335	)	$	568
Investment income		306			75
Realized and unrealized gains (losses) on investments		534			(3,875	)
Net periodic pension benefit		241			(30	)
Other, net	$	746		$	(3,262	)

Business Restructuring

3 Months Ended

Mar. 31, 2021

Restructuring And Related Activities [Abstract]

Business Restructuring

16.	BUSINESS RESTRUCTURING

2018 Restructuring

During the third quarter of 2018, the Company approved a plan to shut down Surfactant operations at its German plant site. As of March 31, 2020, an aggregate of $2,392,000 shut down related expense has been recognized at the site. In the first quarter of 2020, the Company recognized $79,000 of decommissioning expenses at the site. The Company finalized shut down of the plant in 2020 and no more expenses associated with the restructuring are expected.

2016 Restructuring

During 2016, the Company shut down its Longford Mills, Ontario, Canada (Longford Mills) manufacturing facility, a part of the Surfactant reportable segment. The shutdown plan was implemented to improve the Company’s asset utilization in North America and to reduce the Company’s fixed cost base. Manufacturing operations of the Longford Mills plant ceased by the end of 2016, and production of goods manufactured at the facility was transferred to other Company North American production sites. Decommissioning of the assets is expected to continue throughout 2021. As of March 31, 2021, $8,698,000 of aggregate restructuring expense has been recognized, reflecting $1,644,000 of termination benefits for approximately 30 employees and $7,054,000 for other expenses, principally site decommissioning costs. The Company recognized $81,000 and $278,000 of decommissioning expenses in the first quarter of 2021 and 2020, respectively.

Acquisitions

3 Months Ended

Mar. 31, 2021

Business Combinations [Abstract]

Acquisitions

17.	ACQUISITIONS

2021 Acquisitions

INVISTA Acquisition

On January 29, 2021, the Company and its wholly-owned subsidiaries Stepan Holdings Netherlands B.V. and Stepan UK Limited (collectively, “Stepan”) entered into a Stock and Asset Purchase Agreement with Arteva Specialties B.V., INV Performance Surfaces, LLC, INVISTA Textiles (U.K.) Limited, INV Management Services, LLC, and INVISTA Equities, LLC (collectively, “INVISTA”) to acquire INVISTA's aromatic polyester polyol business and associated assets. Included in the transaction were two manufacturing sites, one in Wilmington, North Carolina (U.S.) and the other in Vlissingen, Netherlands, along with intellectual property, customer relationships, inventory and working capital. This acquisition expands the Company’s manufacturing capabilities in both the United States and Europe and enhances its business continuity capabilities for the market. The Company believes that INVISTA’s available spare capacity, combined with debottlenecking opportunities for both plants, will allow Stepan to support future market growth in a capital efficient way. The purchase price was $165,000,000, plus $21,000,000 of estimated working capital and $3,000,000 of associated value-added taxes (VAT) and was paid in cash. The working capital acquired included $5,000,000 of cash. The acquisition has been accounted for as a business combination, and the acquired operations are included in the Company’s Polymer segment in the first quarter of 2021. The assets acquired and liabilities assumed as part of the acquisition were measured and recorded at estimated fair value. The purchase price allocation remains preliminary as of March 31, 2021 pending finalization of the fair value of intangibles and property, plant and equipment. The principle valuation techniques employed include cost and market approaches (PP&E), relief from royalty method under the income approach (trade name and technology/know) and multi-period excess earnings method under the income approach (customer relationships). The following table summarizes the preliminary purchase price allocation for the major components of the acquisition:

(In thousands)
Assets:
Property, plant and equipment	$	54,400
Identifiable intangible assets		45,500
Goodwill		65,100
Total assets acquired	$	165,000

The acquired goodwill includes proprietary and intellectual property, brand recognition, business continuity benefits and marketing, manufacturing and supply chain synergies of the new business with the Company’s existing Polymer business. The acquired goodwill has been assigned to the Polymers segment and is deductible for tax purposes. Identifiable intangible assets included technology and manufacturing know-how ($13,000,000), trademarks ($8,000,000) and customer relationships ($24,500,000). The amortization periods for know-how and trademarks has initially been estimated to be in the range of 7 to 8 years. The amortization period for customer relationships has initially been estimated to be in the range of 12 to 14 years. As of March 31, 2021, in addition to the purchase price, the Company also paid $3,232,000 of acquisition-related expenses that included legal, consulting, valuation and accounting services. During the first three months of 2021, the Company incurred $1,285,000 of acquisition-related expenses. These costs were included in the Administrative expenses line in the Company’s condensed consolidated statement of income.

The following table reflects pro forma financial information prepared under the assumption that the acquisition of the INVISTA aromatic polyester polyol business occurred on January 1, 2020.

Pro Forma Financial Information

Unaudited

	Three Months Ended March 31
(In thousands, except per share amounts)	2021		2020
Net Sales	$	550,179	$	475,887
Net Income Attributable to Stepan Company	$	43,112	$	28,602

The supplemental pro forma information is presented for illustrative purposes only and may not be indicative of the consolidated results that would have actually been achieved by the Company. Furthermore, future results may vary significantly from the results reflected in the pro forma information. The pro forma results include adjustments primarily related to amortization of acquired intangible assets, depreciation of the fair value adjustment of acquisition-date plant assets, and tax expense. In addition, non-recurring adjustments to pro forma net income include $1,285,000 of acquisition-related expenses - such expenses were excluded from 2021 pro forma net income and included in 2020 pro forma net income.

Fermentation Plant Acquisition

On February 2, 2021, the Company acquired a fermentation plant, located in Lake Providence, Louisiana (U.S.). The Company believes this plant complements the rhamnolipid-based bio-surfactant technology the Company acquired from Logos Technologies in March 2020. Fermentation is a new platform technology for the Company and the Company is focusing efforts to further develop, integrate, produce and commercialize these unique surfactants moving forward. Bio-surfactants, produced via fermentation, are attractive due to their biodegradability, low toxicity, and in some cases, unique antimicrobial properties. These bio-surfactants offer synergies in several strategic end use markets including oilfield, agriculture, personal care and household, industrial and institutional. The acquisition of this industrial scale fermentation plant represents the latest step in the Company’s bio-surfactant commercialization efforts. The purchase price was $3,500,000 and was paid in cash. This acquisition has been accounted for as an asset acquisition.

2020 Acquisitions

Clariant (Mexico) Acquisition

On September 17, 2020, the Company through its subsidiaries in Mexico, acquired Clariant (Mexico) S.A. de C.V.’s (Clariant) anionic business located in Santa Clara, Mexico. The acquisition did not include the purchase of a manufacturing site. The business acquired was integrated into the Company’s two existing manufacturing sites in Mexico (Matamoros and Ecatepec). The purchase price of the acquisition was $14,000,000, plus associated value-added taxes (VAT). As of March 31, 2021, $13,519,000, inclusive of $308,000 net VAT, had been paid with cash on hand. The acquisition was accounted for as a business combination and the assets were measured and recorded at their estimated fair value. The acquired goodwill is not tax deductible. All assets acquired are included in the Company’s Surfactants segment. The following table summarizes the purchase price allocation for the acquisition:

(In thousands)
Assets:
Identifiable intangible assets:
Customer lists	$	8,000
Trademarks and know-how		1,300
Non-compete agreement		300
Goodwill		4,225
Property, plant and equipment		175
Total assets acquired	$	14,000

Logos Technologies Acquisition

On March 13, 2020, the Company acquired certain assets of Logos Technologies LLC's NatSurFact® business, a rhamnolipid-based line of bio-surfactants derived from renewable sources. These bio-surfactants offer synergies in several strategic end use markets including oilfield, agriculture, personal care and household, industrial and institutional. The acquisition was accounted for as an asset acquisition. The purchase price of the acquisition was $2,040,000 and was paid with cash on hand. All assets acquired are included in the Company’s Surfactants segment. The assets acquired were primarily intangibles, including trademarks and know-how ($1,392,000) and patents ($464,000). Additionally, $184,000 of laboratory equipment was acquired.

Recent Accounting Pronouncements

3 Months Ended

Mar. 31, 2021

Accounting Changes And Error Corrections [Abstract]

Recent Accounting Pronouncements

18.	RECENT ACCOUNTING PRONOUNCEMENTS

In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes. This update provides guidance to reduce complexity in certain areas of accounting for income taxes. The amendments in this update are effective for fiscal years beginning after December 15, 2020. The Company adopted ASU. No. 2019-12 in the first quarter of 2021 and the adoption of this update did not have a material effect on the Company’s financial position, results of operations and cash flows.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848) Facilitation of the Effect of Reference Rate Reform on Financial Reporting. This update provides optional guidance for a limited period of time to ease the burden of implementing the usage of new reference rates. The amendments apply to contract modifications that replace a reference rate affected by reference rate reform and contemporaneous modifications of other contract terms related to the replacement of the reference rate. If elected the optional expedients to contract modifications must be applied consistently for all eligible contracts or eligible transactions. The amendments in this update may be implemented between March 12, 2020 and December 31, 2022. The guidance should be applied prospectively. The Company has not utilized any of the optional expedients of exceptions available under this ASU. The Company will continue to assess whether this ASU is applicable throughout the effective period.

The entire disclosure for change in accounting principle. Includes, but is not limited to, nature, reason, and method of adopting amendment to accounting standards or other change in accounting principle.

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Accounting Changes And Error Corrections [Abstract]

Recent Accounting Pronouncements (Policies)

3 Months Ended

Mar. 31, 2021

Recent Accounting Pronouncements

Reconciliations of Equity (Tables)

3 Months Ended

Mar. 31, 2021

Reconciliations of Total Equity

Below are reconciliations of total equity, Company equity and equity attributable to noncontrolling interests for the three months ended March 31, 2021 and 2020:

(In thousands, except share and per share amounts)	Total			Common Stock		Additional Paid-in Capital		Common Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Retained Earnings			Noncontrolling Interest ⁽¹⁾
Balance, December 31, 2020	$	988,365		$	26,658	$	206,716	$	(133,629	)	$	(136,881	)	$	1,023,829		$	1,672

Issuance of 5,786 shares of common stock under stock option plan		381			6		375		—			—			—			—

Purchase of 8,300 shares of common stock		(989	)		—		—		(989	)		—			—			—

Stock-based and deferred compensation		8			62		2,380		(2,434	)		—			—			—
							—
Net income		40,611			—		—		—			—			40,611			—

Other comprehensive income (loss)		(17,569	)		—		—		—			(17,561	)		—			(8	)

Cash dividends paid:
Common stock ($0.305 per share)		(6,861	)		—		—		—			—			(6,861	)		—
Balance, March 31, 2021	$	1,003,946		$	26,726	$	209,471	$	(137,052	)	$	(154,442	)	$	1,057,579		$	1,664

(In thousands, except share and per share amounts)	Total			Common Stock		Additional Paid-in Capital		Common Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Retained Earnings			Noncontrolling Interest ⁽¹⁾
Balance, December 31, 2019	$	892,496		$	26,493	$	193,135	$	(114,139	)	$	(136,170	)	$	922,464		$	713

Issuance of 2,747 shares of common stock under stock option plan		155			3		152		—			—			—			—

Purchase of 89,225 shares of common stock		(7,243	)		—		—		(7,243	)		—			—			—

Stock-based and deferred compensation		1,116			45		2,374		(1,303	)		—			—			—

Net income		27,539			—		—		—			—			27,545			(6	)

Other comprehensive income (loss)		(40,389	)		—		—		—			(40,376	)		—			(13	)

Cash dividends paid:
Common stock ($0.275 per share)		(6,202	)		—		—		—			—			(6,202	)		—
Balance, March 31, 2020	$	867,472		$	26,541	$	195,661	$	(122,685	)	$	(176,546	)	$	943,807		$	694

(1)

Reflects the noncontrolling interest in the Company’s China joint venture.

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

Fair Values and Related Carrying Values of Debt

(In thousands)

March 31,

2021

December 31,

2020

Fair value

259,889

210,370

Carrying value

248,954

199,286

Financial Assets and Liabilities, Excluding Cash and Cash Equivalents, Measured on a Recurring Basis at Fair Value

(In thousands)	March 2021		Level 1		Level 2		Level 3
Mutual fund assets	$	30,212	$	30,212	$	—	$	—
Derivative assets:
Foreign currency contracts		231		—		231		—
Total assets at fair value	$	30,443	$	30,212	$	231	$	—
Derivative liabilities:
Foreign currency contracts	$	196	$	—	$	196	$	—

(In thousands)	December 2020		Level 1		Level 2		Level 3
Mutual fund assets	$	30,652	$	30,652	$	—	$	—
Derivative assets:
Foreign currency contracts		335		—		335		—
Total assets at fair value	$	30,987	$	30,652	$	335	$	—
Derivative liabilities:
Foreign currency contracts	$	566	$	-	$	566	$	—

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-based Compensation (Tables)

3 Months Ended

Mar. 31, 2021

Compensation Expense Recorded for All Stock Options, Stock Awards and SARs

Compensation expense recorded for all stock options, stock awards and SARs was as follows:

Unrecognized Compensation Costs for Stock Options, Stock Awards and SARs

Unrecognized compensation costs for stock options, stock awards and SARs were as follows:

(In thousands)	March 31, 2021		December 31, 2020
Stock options	$	3,780	$	1,993
Stock awards		8,674		5,313
SARs		8,176		4,341

Share Based Payment Awards Granted in Period

The increases in unrecognized compensation costs for stock options, stock awards and SARs reflected the 2021 grants of:

	Shares
Stock options		66,134
Stock awards (at target)		41,228
SARs		142,451

Inventories (Tables)

3 Months Ended

Mar. 31, 2021

Inventory Disclosure [Abstract]

Composition of Inventories

The composition of inventories at March 31, 2021, and December 31, 2020, was as follows:

(In thousands)	March 31, 2021		December 31, 2020
Finished goods	$	156,228	$	148,878
Raw materials		78,834		69,905
Total inventories	$	235,062	$	218,783

Leases (Tables)

3 Months Ended

Mar. 31, 2021

Leases [Abstract]

Schedule of Lease Cost Included in Cost of Sale and Operating Expenses

Lease cost is included in the Cost of Sales and Operating Expenses sections of the Condensed Consolidated Statements of Income.

(In thousands)	March 31, 2021
Lease Cost
Operating lease cost	$	3,726
Short-term lease cost		1,269
Variable lease cost		283
Total lease cost	$	5,278
Other Information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating leases	$	3,289
Right-of-use assets obtained in exchange for new operating lease liabilities		12,627

Schedule of Lease Liability Payments

(In thousands)
Undiscounted Cash Flows:
2021 (excluding the three months ended March 31, 2021)	$	10,753
2022		13,081
2023		10,847
2024		6,935
2025		5,306
Subsequent to 2025		39,647
Total Undiscounted Cash Flows	$	86,569
Less: Imputed interest		(13,765	)
Present value	$	72,804
Current operating lease liabilities ⁽¹⁾		12,371
Non-current operating lease liabilities		60,433
Total lease liabilities	$	72,804

(1)

This item is included in the Accrued liabilities line on the Company’s Condensed Consolidated Balance Sheet.

Schedule of Operating Leases Weighted Average, Remaining Lease Term and Discount Rate

Weighted-average remaining lease term-operating leases		10 years
Weighted-average discount rate-operating leases			3.0	%

Postretirement Benefit Plans (Tables)

3 Months Ended

Mar. 31, 2021

Compensation And Retirement Disclosure [Abstract]

Components of Net Periodic Benefit Cost

	UNITED STATES						UNITED KINGDOM
(In thousands)	Three Months Ended March 31						Three Months Ended March 31
	2021			2020			2021			2020
Interest cost	$	1,177		$	1,421		$	88		$	109
Expected return on plan assets		(2,586	)		(2,437	)		(81	)		(134	)
Amortization of net actuarial loss		1,144			1,052			17			19
Net periodic benefit cost	$	(265	)	$	36		$	24		$	(6	)

Defined Contribution Plan Expenses for Company's Qualified Contribution Plans

Defined contribution plan expenses for the Company’s qualified contribution plans were as follows:

(In thousands)	Three Months Ended March 31
	2021		2020
Retirement savings contributions	$	2,039	$	1,758
Profit sharing contributions		1,866		975
Total defined contribution plan expenses	$	3,905	$	2,733

Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2021

Earnings Per Share [Abstract]

Computations of Basic and Diluted Earnings Per Share

Below are the computations of basic and diluted earnings per share for the three months ended March 31, 2021 and 2020:

(In thousands, except per share amounts)	Three Months Ended March 31
	2021		2020
Computation of Basic Earnings per Share
Net income attributable to Stepan Company	$	40,611	$	27,545
Weighted-average number of common shares outstanding		22,974		23,023
Basic earnings per share	$	1.77	$	1.20

Computation of Diluted Earnings per Share
Net income attributable to Stepan Company	$	40,611	$	27,545
Weighted-average number of shares outstanding		22,974		23,023
Add weighted-average net shares from assumed exercise of options (under treasury stock method) ⁽¹⁾		140		102
Add weighted-average net shares related to unvested stock awards (under treasury stock method)		1		1
Add weighted-average net shares from assumed exercise of SARs (under treasury stock method) ⁽¹⁾		171		128
Add weighted-average contingently issuable net shares related to performance stock awards (under treasury stock method)		44		31
Weighted-average shares applicable to diluted earnings		23,330		23,285
Diluted earnings per share	$	1.74	$	1.18

Accumulated Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Mar. 31, 2021

Summary of Changes in Accumulated Other Comprehensive Income

Below is the change in the Company’s AOCI balance by component (net of income taxes) for the three months ended March 31, 2021 and 2020:

(In thousands)	Foreign Currency Translation Adjustments			Defined Benefit Pension Plan Adjustments			Cash Flow Hedge Adjustments			Total
Balance at December 31, 2019	$	(104,037	)	$	(32,205	)	$	72		$	(136,170	)
Other comprehensive income (loss) before reclassifications		(41,182	)		808			—			(40,374	)
Amounts reclassified from AOCI		—			—			(2	)		(2	)
Net current-period other comprehensive income (loss)		(41,182	)		808			(2	)		(40,376	)
Balance at March 31, 2020	$	(145,219	)	$	(31,397	)	$	70		$	(176,546	)

Balance at December 31, 2020	$	(107,083	)	$	(29,861	)	$	63		$	(136,881	)
Other comprehensive income (loss) before reclassifications		(18,433	)		874			—			(17,559	)
Amounts reclassified from AOCI		—			—			(2	)		(2	)
Net current-period other comprehensive income (loss)		(18,433	)		874			(2	)		(17,561	)
Balance at March 31, 2021	$	(125,516	)	$	(28,987	)	$	61		$	(154,442	)

Summary of Amounts Reclassifications Out of Accumulated Other Comprehensive Income

Information regarding the reclassifications out of AOCI for the three-month periods ended March 31, 2021 and 2020, is displayed below:

(In thousands)	Amount Reclassified from AOCI⁽¹⁾
AOCI Components	Three Months Ended March 31						Affected Line Item in Condensed Consolidated Statements of Income
	2021			2020
Amortization of defined benefit pension actuarial losses	$	(1,161	)	$	(1,071	)	⁽²⁾
		287			263		Tax benefit
	$	(874	)	$	(808	)	Net of tax
Gains and losses on cash flow hedges:
Foreign exchange contracts		2			2		Cost of sales
		2			2		Total before tax
		—			—		Tax benefit
	$	2		$	2		Net of tax
Total reclassifications for the period	$	(872	)	$	(806	)	Net of tax

(1)

Amounts in parentheses denote expense to statement of income.

(2)

Segment Reporting (Tables)

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

Operating Segment

The Company has three reportable segments: Surfactants, Polymers and Specialty Products. Net sales by segment for the three months ended March 31, 2021 and 2020, were as follows:

(In thousands)	Three Months Ended March 31
	2021		2020
Segment Net Sales
Surfactants	$	370,936	$	327,071
Polymers		150,385		106,491
Specialty Products		16,419		16,425
Total	$	537,740	$	449,987

Reconciliation of Segment Information to Income Before Provision for Income Taxes

Segment operating income and reconciliations of segment operating income to income before provision for income taxes for the three months ended March 31, 2021 and 2020, are summarized below:

(In thousands)	Three Months Ended March 31
	2021			2020
Segment Operating Income
Surfactants	$	53,210		$	36,156
Polymers		17,951			7,516
Specialty Products		2,633			3,984
Segment operating income		73,794			47,656
Business restructuring		(81	)		(357	)
Unallocated corporate expenses ⁽¹⁾		(19,799	)		(7,295	)
Consolidated operating income		53,914			40,004
Interest expense, net		(1,524	)		(1,230	)
Other, net		746			(3,262	)
Income before provision for income taxes	$	53,136		$	35,512

(1)

Revenue from Contracts with Customers (Tables)

3 Months Ended

Mar. 31, 2021

Revenue From Contract With Customer [Abstract]

Geographic Disaggregation of Net Sales

	For the Three Months Ended March 31, 2021
(In thousands)
	Surfactants		Polymers		Specialty		Total
Geographic Market
North America	$	220,935	$	70,878	$	13,937	$	305,750
Europe		71,094		68,300		2,482		141,876
Latin America		60,169		990		—		61,159
Asia		18,738		10,217		—		28,955
Total	$	370,936	$	150,385	$	16,419	$	537,740

(In thousands)	For the Three Months Ended March 31, 2020
	Surfactants		Polymers		Specialty		Total
Geographic Market
North America	$	207,946	$	61,841	$	13,494	$	283,281
Europe		59,660		36,560		2,931		99,151
Latin America		46,510		639		—		47,149
Asia		12,955		7,451		—		20,406
Total	$	327,071	$	106,491	$	16,425	$	449,987

Debt (Tables)

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Debt

Debt was comprised of the following at March 31, 2021, and December 31, 2020:

(In thousands)	Maturity Dates	March 31, 2021		December 31, 2020
Unsecured private placement notes
3.95% (net of unamortized debt issuance cost of $262 and $273 for 2021 and 2020, respectively)	2021-2027	$	99,738	$	99,727
3.86% (net of unamortized debt issuance cost of $222 and $236 for 2021 and 2020, respectively)	2021-2025		71,207		71,193
4.86% (net of unamortized debt issuance cost of $98 and $108 for 2021 and 2020, respectively)	2021-2023		27,759		27,749
Revolving credit facility borrowing	2021		45,000		—
Debt of foreign subsidiaries
Unsecured bank debt, foreign currency	2021		4,668		—
Total debt		$	248,372	$	198,669
Less current maturities			87,525		37,857
Long-term debt		$	160,847	$	160,812

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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Other Income And Expenses [Abstract]

Other, Net (Tables)

3 Months Ended

Mar. 31, 2021

Other Net in Condensed Consolidated Statements of Income

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

(In thousands)	Three Months Ended March 31
	2021			2020
Foreign exchange (losses) gains	$	(335	)	$	568
Investment income		306			75
Realized and unrealized gains (losses) on investments		534			(3,875	)
Net periodic pension benefit		241			(30	)
Other, net	$	746		$	(3,262	)

Acquisitions (Tables)

3 Months Ended

Mar. 31, 2021

2021 Acquisitions [Member]

Business Acquisition [Line Items]

Summary of Purchase Price Allocation for Major Components of Acquisition

The following table summarizes the preliminary purchase price allocation for the major components of the acquisition:

(In thousands)
Assets:
Property, plant and equipment	$	54,400
Identifiable intangible assets		45,500
Goodwill		65,100
Total assets acquired	$	165,000

Summary of Pro forma Financial Information

The following table reflects pro forma financial information prepared under the assumption that the acquisition of the INVISTA aromatic polyester polyol business occurred on January 1, 2020.

Pro Forma Financial Information

Unaudited

	Three Months Ended March 31
(In thousands, except per share amounts)	2021		2020
Net Sales	$	550,179	$	475,887
Net Income Attributable to Stepan Company	$	43,112	$	28,602

2020 Acquisitions [Member]

Business Acquisition [Line Items]

Summary of Purchase Price Allocation for Major Components of Acquisition

The following table summarizes the purchase price allocation for the acquisition:

(In thousands)
Assets:
Identifiable intangible assets:
Customer lists	$	8,000
Trademarks and know-how		1,300
Non-compete agreement		300
Goodwill		4,225
Property, plant and equipment		175
Total assets acquired	$	14,000

Reconciliations of Equity - Reconciliations of Total Equity (Detail) - USD ($)
$ in Thousands

3 Months Ended

Mar. 31, 2021

Mar. 31, 2020

Issuance of common stock under stock option plan

$ 988,365

$ 892,496

381

155

Purchase of common stock

(989)

(7,243)

1,116

Other comprehensive income (loss)

40,611

27,539

(17,569)

(40,389)

Common stock

(6,861)

(6,202)

1,003,946

867,472

Common Stock [Member]

Issuance of common stock under stock option plan

26,658

26,493

Additional Paid-in Capital [Member]

26,726

26,541

Issuance of common stock under stock option plan

206,716

193,135

375

152

2,380

2,374

Common Treasury Stock [Member]

209,471

195,661

(133,629)

(114,139)

Purchase of common stock

(989)

(7,243)

(2,434)

(1,303)

Accumulated Other Comprehensive Income (Loss) [Member]

(137,052)

(122,685)

Other comprehensive income (loss)

(136,881)

(136,170)

(17,561)

(40,376)

Retained Earnings [Member]

(154,442)

(176,546)

1,023,829

922,464

40,611

27,545

Common stock

(6,861)

(6,202)

Noncontrolling Interest [Member]

1,057,579

943,807

^[1]

1,672

713

Other comprehensive income (loss)

^[1]

(6)

^[1]

(8)

(13)

^[1]

$ 1,664

$ 694

[1]	Reflects the noncontrolling interest in the Company’s China joint venture.

Reconciliations of Equity - Reconciliations of Total Equity (Parenthetical) (Detail) - $ / shares	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Number of shares of common stock issued under stock option plan	5,786	2,747
Number of common stock shares purchased	8,300	89,225
Common stock	$ 0.305	$ 0.275
Common Stock [Member]
Number of shares of common stock issued under stock option plan	5,786	2,747
Additional Paid-in Capital [Member]
Number of shares of common stock issued under stock option plan	5,786	2,747
Common Treasury Stock [Member]
Number of common stock shares purchased	8,300	89,225
Retained Earnings [Member]
Common stock	$ 0.305	$ 0.275

Fair Value Measurements - Additional Information (Detail) - USD ($)	Mar. 31, 2021	Dec. 31, 2020
Fair Value Disclosures [Abstract]
Unamortized debt issuance cost	$ 582,000	$ 617,000

Fair Value Measurements - Fair Values and Related Carrying Values of Debt (Detail) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Carrying value	$ 248,954	$ 199,286
Level 2 [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Fair value	$ 259,889	$ 210,370

Fair Value Measurements - Financial Assets and Liabilities, Excluding Cash and Cash Equivalents, Measured on a Recurring Basis at Fair Value (Detail) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Mutual fund assets	$ 30,212	$ 30,652
Derivative assets:
Foreign currency contracts	231	335
Total assets at fair value	30,443	30,987
Derivative liabilities:
Foreign currency contracts	196	566
Level 1 [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Mutual fund assets	30,212	30,652
Derivative assets:
Total assets at fair value	30,212	30,652
Level 2 [Member]
Derivative assets:
Foreign currency contracts	231	335
Total assets at fair value	231	335
Derivative liabilities:
Foreign currency contracts	$ 196	$ 566

Derivative Instruments - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Derivative notional amount	$ 46,640,000	$ 48,336,000
Minimum [Member]
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Derivative foreign currency exchange contracts durations	1 month
Maximum [Member]
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Derivative foreign currency exchange contracts durations	3 months

Stock-based Compensation - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2021
Stock Option and Stock Appreciation Rights (SARs) Granted Prior to 2017 [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vesting period	2 years
Stock Option and Stock Appreciation Rights (SARS) Granted in 2017 [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vesting period	3 years
Percentage of awards vesting in each year	33.33%
Stock Option [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Weighted average period for amortization of unrecognized compensation cost	2 years 2 months 12 days
Stock Awards [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Weighted average period for amortization of unrecognized compensation cost	2 years 1 month 6 days
SARs [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Weighted average period for amortization of unrecognized compensation cost	2 years 2 months 12 days

Stock-based Compensation - Compensation Expense Recorded for All Stock Options, Stock Awards and SARs (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Compensation expense	$ 2,540	$ 1,202

Stock-based Compensation - Unrecognized Compensation Costs for Stock Options, Stock Awards and SARs (Detail) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Stock Option [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized compensation costs for stock options, stock awards and SARs	$ 3,780	$ 1,993
Stock Awards [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized compensation costs for stock options, stock awards and SARs	8,674	5,313
SARs [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized compensation costs for stock options, stock awards and SARs	$ 8,176	$ 4,341

Stock-based Compensation - Share Based Payment Awards Granted in Period (Detail)	3 Months Ended
	Mar. 31, 2021 shares
Stock Option [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock options granted in period	66,134
Stock Awards (at target) [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Awards granted in period	41,228
SARs [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Awards granted in period	142,451

Inventories - Composition of Inventories (Detail) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Inventory Disclosure [Abstract]
Finished goods	$ 156,228	$ 148,878
Raw materials	78,834	69,905
Total inventories	$ 235,062	$ 218,783

Leases - Additional Information (Detail) $ in Thousands	3 Months Ended
Leases - Additional Information (Detail) $ in Thousands	Mar. 31, 2021 USD ($) Country	Jun. 30, 2021
Operating Leased Assets [Line Items]
Operating lease, liability	$ 72,804
Number of countries leases reside \| Country	5
Percentage of value of leases reside	98.00%
Minimum [Member]
Operating Leased Assets [Line Items]
Lessee, operating lease, term of contract	1 year
Maximum [Member]
Operating Leased Assets [Line Items]
Lessee, operating lease, term of contract	10 years
Railcars [Member]
Operating Leased Assets [Line Items]
Percentage of lease asset categories	24.00%
Real Estate [Member]
Operating Leased Assets [Line Items]
Percentage of lease asset categories	62.00%
Real Estate [Member] \| Minimum [Member]
Operating Leased Assets [Line Items]
Lessee, operating lease, term of contract	1 year
Real Estate [Member] \| Maximum [Member]
Operating Leased Assets [Line Items]
Lessee, operating lease, term of contract	50 years
Storage Tank [Member]
Operating Leased Assets [Line Items]
Operating lease, liability	$ 168,000
Storage Tank [Member] \| Scenario Forecast [Member]
Operating Leased Assets [Line Items]
Lessee, operating lease, term of contract		2 years

Leases - Schedule of Lease Cost Included in Cost of Sale and Operating Expenses (Detail) $ in Thousands	3 Months Ended
	Mar. 31, 2021 USD ($)
Lease Cost
Operating lease cost	$ 3,726
Short-term lease cost	1,269
Variable lease cost	283
Total lease cost	5,278
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating leases	3,289
Right-of-use assets obtained in exchange for new operating lease liabilities	$ 12,627

Leases - Schedule of Lease Liability Payments (Detail) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Leases [Abstract]
2021 (excluding the three months ended March 31, 2021)	$ 10,753
2022	13,081
2023	10,847
2024	6,935
2025	5,306
Subsequent to 2025	39,647
Total Undiscounted Cash Flows	86,569
Less: Imputed interest	(13,765)
Present value	72,804
Current operating lease liabilities	12,371
Non-current operating lease liabilities	60,433	$ 51,567
Total lease liabilities	$ 72,804

Leases - Schedule of Operating Leases Weighted Average, Remaining Lease Term and Discount Rate (Detail)	Mar. 31, 2021
Leases [Abstract]
Weighted-average remaining lease term-operating leases	10 years
Weighted-average discount rate-operating leases	3.00%

Contingencies - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Site Contingency [Line Items]
Environmental losses accrual	$ 22,866,000		$ 22,884,000
Cash expenditures related to legal matters and environmental matters	$ 280,000	$ 912,000
Contribution for future response costs	5.00%
Wilmington Site [Member]
Site Contingency [Line Items]
Payment of environmental response costs	$ 3,078,000
Minimum [Member]
Site Contingency [Line Items]
Environmental losses and legal losses	22,866,000
Maximum [Member]
Site Contingency [Line Items]
Environmental losses and legal losses	$ 41,313,000

Postretirement Benefit Plans - Components of Net Periodic Benefit Cost (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Defined Benefit Plan Disclosure [Line Items]
Net periodic benefit cost	$ (241)	$ 30
United States [Member]
Defined Benefit Plan Disclosure [Line Items]
Interest cost	1,177	1,421
Expected return on plan assets	(2,586)	(2,437)
Amortization of net actuarial loss	1,144	1,052
Net periodic benefit cost	(265)	36
United Kingdom [Member]
Defined Benefit Plan Disclosure [Line Items]
Interest cost	88	109
Expected return on plan assets	(81)	(134)
Amortization of net actuarial loss	17	19
Net periodic benefit cost	$ 24	$ (6)

Postretirement Benefit Plans - Defined Benefit Pension Plans - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2021 USD ($)
Defined Contribution Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Balance of trust assets	$ 2,035,000
United States [Member] \| Unfunded Plan [Member] \| Non-qualified Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Expected contributions or payments to defined benefit plans	274,000
Employer contributions or payments	119,000
U.K Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Expected contributions or payments to defined benefit plans	495,000
Employer contributions or payments	$ 141,000

Amount of contribution received by defined benefit plan from employer which increases plan assets.

Computation of Basic Earnings per Share

Postretirement Benefit Plans - Defined Contribution Plan Expenses for Company's Qualified Contribution Plans (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Defined Contribution Plan Disclosure [Line Items]
Total defined contribution plan expenses	$ 3,905	$ 2,733
Retirement Savings Contributions [Member]
Defined Contribution Plan Disclosure [Line Items]
Total defined contribution plan expenses	2,039	1,758
Profit Sharing Contributions [Member]
Defined Contribution Plan Disclosure [Line Items]
Total defined contribution plan expenses	$ 1,866	$ 975

Earnings Per Share - Computations of Basic and Diluted Earnings Per Share (Detail) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands

3 Months Ended

Mar. 31, 2021

Mar. 31, 2020

Net income attributable to Stepan Company

$ 40,611

$ 27,545

Weighted-average number of common shares outstanding

22,974

23,023

Basic earnings per share

$ 1.77

$ 1.20

Net income attributable to Stepan Company

$ 40,611

$ 27,545

Weighted-average number of common shares outstanding

22,974

23,023

Add weighted-average net shares related to unvested stock awards (under treasury stock method)

Weighted-average shares applicable to diluted earnings

23,330

23,285

Diluted earnings per share

$ 1.74

$ 1.18

Stock Option [Member]

Add weighted-average net shares from assumed exercise of options (under treasury stock method)

^[1]

140

102

Stock Appreciation Rights (SARs) [Member]

Add weighted-average net shares from assumed exercise of options (under treasury stock method)

^[1]

171

128

Performance Stock Award [Member]

Add weighted-average net shares from assumed exercise of options (under treasury stock method)

[1]

No options/SARs to acquire shares of Company common stock were excluded from the computation of dilutive earnings per share for the three months ended March 31, 2021. Options/SARs to acquire 256,288 shares of Company common stock were excluded from the computations of diluted earnings per share for the three months ended March 31, 2020. Inclusion of the instruments would have had an antidilutive effect on the computations of the earnings per share.

Earnings Per Share - Computations of Basic and Diluted Earnings Per Share (Parenthetical) (Detail) - shares	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Options and Stock Appreciation Rights (SARs) [Member]
Earnings Per Share Basic [Line Items]
Options/SARs to purchase shares of common stock were excluded from the computations of diluted earnings per share	0	256,288

Accumulated Other Comprehensive Income (Loss) - Summary of Changes in Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning Balance	$ 986,693
Other comprehensive income (loss) before reclassifications	(17,559)	$ (40,374)
Amounts reclassified from AOCI	(2)	(2)
Net current-period other comprehensive income (loss)	(17,561)	(40,376)
Ending Balance	1,002,282
Foreign Currency Translation Adjustments [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning Balance	(107,083)	(104,037)
Other comprehensive income (loss) before reclassifications	(18,433)	(41,182)
Net current-period other comprehensive income (loss)	(18,433)	(41,182)
Ending Balance	(125,516)	(145,219)
Defined Benefit Pension Plan Adjustments [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning Balance	(29,861)	(32,205)
Other comprehensive income (loss) before reclassifications	874	808
Net current-period other comprehensive income (loss)	874	808
Ending Balance	(28,987)	(31,397)
Cash Flow Hedge Adjustments [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning Balance	63	72
Amounts reclassified from AOCI	(2)	(2)
Net current-period other comprehensive income (loss)	(2)	(2)
Ending Balance	61	70
AOCI Attributable to Parent [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning Balance	(136,881)	(136,170)
Ending Balance	$ (154,442)	$ (176,546)

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]

Accumulated Other Comprehensive Income (Loss) - Summary of Amounts Reclassifications Out of Accumulated Other Comprehensive Income (Detail) - USD ($)
$ in Thousands

3 Months Ended

Mar. 31, 2021

Mar. 31, 2020

Income Before Provision for Income Taxes

$ 53,136

$ 35,512

Tax benefit

(12,525)

(7,973)

Cost of Sales

428,760

370,718

Defined Benefit Pension Plan Adjustments [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]

Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]

Amortization of defined benefit pension actuarial losses

^[1],[2]

(1,161)

(1,071)

Tax benefit

^[1]

287

263

Income applicable to common stock

^[1]

(874)

(808)

Cash Flow Hedge Adjustments [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]

Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]

Income Before Provision for Income Taxes

^[1]

Income applicable to common stock

^[1]

Cash Flow Hedge Adjustments [Member] | Foreign exchange contracts [Member] | Amounts Reclassified From Accumulated Other Comprehensive Income [Member]

Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]

Cost of Sales

^[1]

Accumulated Other Comprehensive Income (Loss) [Member]

Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]

Income applicable to common stock

^[1]

$ (872)

$ (806)

[1]	Amounts in parentheses denote expense to statement of income.
[2]	This component of accumulated other comprehensive income is included in the computation of net periodic benefit cost (see Note 9, Postretirement Benefit Plans, of the notes to the Company’s condensed consolidated financial statements (included in Item 1 of this Form 10-Q) for additional details).

Segment Reporting - Additional Information (Detail)	3 Months Ended
Segment Reporting - Additional Information (Detail)	Mar. 31, 2021 Segment
Segment Reporting [Abstract]
Number of reportable segments	3

Segment Reporting - Operating Segment (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Segment Reporting Information [Line Items]
Net sales	$ 537,740	$ 449,987
Surfactants [Member]
Segment Reporting Information [Line Items]
Net sales	370,936	327,071
Polymers [Member]
Segment Reporting Information [Line Items]
Net sales	150,385	106,491
Specialty Products [Member]
Segment Reporting Information [Line Items]
Net sales	$ 16,419	$ 16,425

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Subparagraph (a)
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
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-Paragraph 4
-Subparagraph (a)
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
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-Subparagraph (a)
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
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-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

Segment Reporting - Reconciliation of Segment Information to Income Before Provision for Income Taxes (Detail) - USD ($)
$ in Thousands

3 Months Ended

Mar. 31, 2021

Mar. 31, 2020

Income before provision for income taxes

$ 53,914

$ 40,004

Business restructuring

(81)

(357)

Interest expense, net

(1,524)

(1,230)

Other, net

746

(3,262)

53,136

35,512

Operating Segments [Member]

Operating Segments [Member] | Surfactants [Member]

73,794

47,656

Operating Segments [Member] | Polymers [Member]

53,210

36,156

Operating Segments [Member] | Specialty Products [Member]

17,951

7,516

Segment Reconciling Items [Member]

2,633

3,984

Unallocated corporate expenses

^[1]

$ (19,799)

$ (7,295)

[1]

Revenue from Contracts with Customers - Additional Information (Detail) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
Revenue From Contract With Customer [Abstract]
Contract assets	$ 0
Contract liabilities	775,000	$ 773,000
Contract liabilities revenue recognized	$ 0	$ 10,709,000

Revenue from Contracts with Customers - Summary of Geographic Disaggregation of Net Sales (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Disaggregation Of Revenue [Line Items]
Net sales	$ 537,740	$ 449,987
Surfactants [Member]
Disaggregation Of Revenue [Line Items]
Net sales	370,936	327,071
Polymers [Member]
Disaggregation Of Revenue [Line Items]
Net sales	150,385	106,491
Specialty Products [Member]
Disaggregation Of Revenue [Line Items]
Net sales	16,419	16,425
North America [Member]
Disaggregation Of Revenue [Line Items]
Net sales	305,750	283,281
North America [Member] \| Surfactants [Member]
Disaggregation Of Revenue [Line Items]
Net sales	220,935	207,946
North America [Member] \| Polymers [Member]
Disaggregation Of Revenue [Line Items]
Net sales	70,878	61,841
North America [Member] \| Specialty Products [Member]
Disaggregation Of Revenue [Line Items]
Net sales	13,937	13,494
Europe [Member]
Disaggregation Of Revenue [Line Items]
Net sales	141,876	99,151
Europe [Member] \| Surfactants [Member]
Disaggregation Of Revenue [Line Items]
Net sales	71,094	59,660
Europe [Member] \| Polymers [Member]
Disaggregation Of Revenue [Line Items]
Net sales	68,300	36,560
Europe [Member] \| Specialty Products [Member]
Disaggregation Of Revenue [Line Items]
Net sales	2,482	2,931
Latin America [Member]
Disaggregation Of Revenue [Line Items]
Net sales	61,159	47,149
Latin America [Member] \| Surfactants [Member]
Disaggregation Of Revenue [Line Items]
Net sales	60,169	46,510
Latin America [Member] \| Polymers [Member]
Disaggregation Of Revenue [Line Items]
Net sales	990	639
Asia [Member]
Disaggregation Of Revenue [Line Items]
Net sales	28,955	20,406
Asia [Member] \| Surfactants [Member]
Disaggregation Of Revenue [Line Items]
Net sales	18,738	12,955
Asia [Member] \| Polymers [Member]
Disaggregation Of Revenue [Line Items]
Net sales	$ 10,217	$ 7,451

Debt - Debt (Detail) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
Debt - Debt (Detail) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Total debt	$ 248,372	$ 198,669
Less current maturities	87,525	37,857
Long-term debt	160,847	160,812
Unsecured private placement 3.95% note [Member]
Debt Instrument [Line Items]
Total debt	$ 99,738	$ 99,727
Debt instrument interest rate percentage	3.95%	3.95%
Unsecured private placement 3.95% note [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Maturity Dates	2021	2021
Unsecured private placement 3.95% note [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Maturity Dates	2027	2027
Unsecured private placement 3.86% note [Member]
Debt Instrument [Line Items]
Total debt	$ 71,207	$ 71,193
Debt instrument interest rate percentage	3.86%	3.86%
Unsecured private placement 3.86% note [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Maturity Dates	2021	2021
Unsecured private placement 3.86% note [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Maturity Dates	2025	2025
Unsecured private placement 4.86% note [Member]
Debt Instrument [Line Items]
Total debt	$ 27,759	$ 27,749
Debt instrument interest rate percentage	4.86%	4.86%
Unsecured private placement 4.86% note [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Maturity Dates	2021	2021
Unsecured private placement 4.86% note [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Maturity Dates	2023	2023
Debt of foreign subsidiaries Unsecured bank debt, foreign currency [Member]
Debt Instrument [Line Items]
Total debt	$ 4,668
Maturity Dates	2021
Revolving credit facility borrowing [Member]
Debt Instrument [Line Items]
Total debt	$ 45,000
Maturity Dates	2021

Debt - Debt (Parenthetical) (Detail) - USD ($)	Mar. 31, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Unamortized debt issuance cost	$ 582,000	$ 617,000
Unsecured private placement 3.95% note [Member]
Debt Instrument [Line Items]
Unamortized debt issuance cost	262,000	273,000
Unsecured private placement 3.86% note [Member]
Debt Instrument [Line Items]
Unamortized debt issuance cost	222,000	236,000
Unsecured private placement 4.86% note [Member]
Debt Instrument [Line Items]
Unamortized debt issuance cost	$ 98,000	$ 108,000

Debt - Additional Information (Detail) - Multi Currency Revolving Credit Agreement [Member] - USD ($)	3 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Revolving credit agreement	$ 350,000,000
Credit agreement secured date	Jan. 30, 2023
Debt Outstanding	$ 45,000,000
Debt weighted average interest rate	1.36%
Letters of Credit Outstanding	$ 6,767,000
Unused Revolving credit	298,233,000
Unrestricted retained earnings	$ 407,026,000	$ 373,884,000

The carrying value as of the balance sheet date of the current and noncurrent portions of long-term obligations drawn from a line of credit, which is a bank's commitment to make loans up to a specific amount. Examples of items that might be included in the application of this element may consist of letters of credit, standby letters of credit, and revolving credit arrangements, under which borrowings can be made up to a maximum amount as of any point in time conditional on satisfaction of specified terms before, as of and after the date of drawdowns on the line. Includes short-term obligations that would normally be classified as current liabilities but for which (a) postbalance sheet date issuance of a long term obligation to refinance the short term obligation on a long term basis, or (b) the enterprise has entered into a financing agreement that clearly permits the enterprise to refinance the short-term obligation on a long term basis and the following conditions are met (1) the agreement does not expire within 1 year and is not cancelable by the lender except for violation of an objectively determinable provision, (2) no violation exists at the BS date, and (3) the lender has entered into the financing agreement is expected to be financially capable of honoring the agreement.