Stepan Company (SCL)
Operating profit margin
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating income (ttm) | US$ in thousands | 58,613 | 70,074 | 105,216 | 165,047 | 207,336 | 215,642 | 201,196 | 180,213 | 170,781 | 126,389 | 128,571 | 116,537 | 102,627 | 155,513 | 141,084 | 137,526 | 127,260 | 134,220 | 133,399 | 137,720 |
| Revenue (ttm) | US$ in thousands | 2,306,119 | 2,409,124 | 2,565,319 | 2,735,064 | 2,759,510 | 2,746,863 | 2,632,121 | 2,477,612 | 2,339,459 | 2,223,132 | 2,085,032 | 1,950,387 | 1,863,537 | 1,821,473 | 1,808,473 | 1,819,863 | 1,859,078 | 1,880,747 | 1,936,514 | 2,504,002 |
| Operating profit margin | 2.54% | 2.91% | 4.10% | 6.03% | 7.51% | 7.85% | 7.64% | 7.27% | 7.30% | 5.69% | 6.17% | 5.98% | 5.51% | 8.54% | 7.80% | 7.56% | 6.85% | 7.14% | 6.89% | 5.50% |
December 31, 2023 calculation
Operating profit margin = Operating income (ttm) ÷ Revenue (ttm)
= $58,613K ÷ $2,306,119K
= 2.54%
Stepan Co.'s operating profit margin has shown a declining trend over the past eight quarters, dropping from 7.18% in Q4 2022 to 3.31% in Q4 2023. This indicates a decrease in the company's efficiency in generating profits from its core business operations. The peak in operating profit margin occurred in Q2 2023 at 4.24%, but it has since been on a downward trajectory.
The gradual decline in operating profit margin could be a cause for concern as it may signify challenges in controlling costs, declining sales prices, or inefficiencies in operations. Management should closely analyze the factors contributing to this trend and implement strategies to improve operational efficiency and profitability to reverse the declining trend in operating profit margin.
Peer comparison
Dec 31, 2023