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MarketScreener Homepage  >  Equities  >  Nyse  >  Corteva, Inc.    CTVA

CORTEVA, INC.

(CTVA)
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Corteva : Presentation ()

11/19/2020 | 05:17am EST

3Q 2020 Earnings Conference Call

November 5, 2020

Safe Harbor Regarding Forward-Looking Statements

Forward-Looking Statements

This presentation contains certain estimates and forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, which are intended to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and may be identified by their use of words like "plans," "expects," "will," "anticipates," "believes," "intends," "projects," "estimates", "guidance", or other words of similar meaning. All statements that address expectations or projections about the future, including statements about Corteva's strategy for growth, product development, regulatory approval, market position, anticipated benefits of recent acquisitions, timing of anticipated benefits from restructuring actions, outcome of contingencies, such as litigation and environmental matters, expenditures, and financial results, as well as expected benefits from, the separation of Corteva from DowDuPont, are forward-looking statements.

Forward-looking statements are based on certain assumptions and expectations of future events which may not be accurate or realized. Forward-looking statements also involve risks and uncertainties, many of which are beyond Corteva's control. While the list of factors presented below is considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Consequences of material differences in results as compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, financial loss, legal liability to third parties and similar risks, any of which could have a material adverse effect on Corteva's business, results of operations and financial condition. Some of the important factors that could cause Corteva's actual results to differ materially from those projected in any such forward-looking statements include: (i) failure to successfully develop and commercialize Corteva's pipeline; (ii) effect of competition and consolidation in Corteva's industry; (iii) failure to obtain or maintain the necessary regulatory approvals for some Corteva's products; (iv) failure to enforce Corteva's intellectual property rights or defend against intellectual property claims asserted by others; (v) effect of competition from manufacturers of generic products; (vi) impact of Corteva's dependence on third parties with respect to certain of its raw materials or licenses and commercialization; (vii) costs of complying with evolving regulatory requirements and the effect of actual or alleged violations of environmental laws or permit requirements; (viii) effect of the degree of public understanding and acceptance or perceived public acceptance of Corteva's biotechnology and other agricultural products; (ix) effect of changes in agricultural and related policies of governments and international organizations; (x) effect of industrial espionage and other disruptions to Corteva's supply chain, information technology or network systems; (xi) competitor's establishment of an intermediary platform for distribution of Corteva's products; (xii) effect of volatility in Corteva's input costs; (xiii) failure to raise capital through the capital markets or short-term borrowings on terms acceptable to Corteva; (xiv) failure of Corteva's customers to pay their debts to Corteva, including customer financing programs; (xv) failure to realize the anticipated benefits of the internal reorganizations taken by DowDuPont in connection with the spin-off of Corteva, including failure to benefit from significant cost synergies; (xvi) risks related to the indemnification obligations of legacy EID liabilities in connection with the separation of Corteva; (xvii) increases in pension and other post-employment benefit plan funding obligations; (xviii) effect of compliance with environmental laws and requirements and adverse judgments on litigation; (xix) risks related to Corteva's global operations; (xx) effect of climate change and unpredictable seasonal and weather factors; (xxi) effect of counterfeit products; (xxii) failure to effectively manage acquisitions, divestitures, alliances and other portfolio actions; (xxiii) risks related to non-cash charges from impairment of goodwill or intangibles assets; (xxiv) risks related to COVID-19; (xxv) risks related to oil and commodity markets, and (xxvi) other risks related to Corteva's Separation from DowDuPont.

Additionally, there may be other risks and uncertainties that Corteva is unable to currently identify or that Corteva does not currently expect to have a material impact on its business. Where, in any forward-looking statement or other estimate, an expectation or belief as to future results or events is expressed, such expectation or belief is based on the current plans and expectations of Corteva's management and expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. Corteva disclaims and does not undertake any obligation to update or revise any forward-looking statement or other estimate, except as required by applicable law. A detailed discussion of some of the significant risks and uncertainties which may cause results and events to differ materially from such forward-looking statements or other estimates is included in the "Risk Factors" section of Corteva's Annual Report on Form 10-K, as modified by subsequent Quarterly Reports on Forms 10-Q and Current Reports on Form 8-K.

2

A Reminder About Non-GAAP Financial Measures and Pro Forma Financial Information

Corteva Unaudited Pro Forma Financial Information

In order to provide the most meaningful comparison of results of operations, supplemental unaudited pro forma financial information for the first quarter of 2019 has been included in this presentation. This presentation presents the pro forma results of Corteva, after giving effect to events that are (1) directly attributable to the merger of DuPont and Dow, debt retirement transactions related to paying off or retiring portions of Historical DuPont's existing debt liabilities, and the separation and distribution to DowDuPont stockholders of all the outstanding shares of Corteva common stock; (2) factually supportable and (3) with respect to the pro forma statements of income, expected to have a continuing impact on the consolidated results. Refer to Corteva's Form 10 registration statement filed on May 6, 2019, which can be found on the investors section of the Corteva website, for further details on the above transactions. The pro forma financial statements were prepared in accordance with Article 11 of Regulation S-X, and are presented for informational purposes only, and do not purport to represent what the results of operations would have been had the above actually occurred on the dates indicated, nor do they purport to project the results of operations for any future period or as of any future date.

Regulation G (Non-GAAP Financial Measures)

This presentation includes information that does not conform to U.S. GAAP and are considered non-GAAP measures. These measures may include organic sales, organic growth (including by segment and region), operating EBITDA, pro forma operating EBITDA, operating EBITDA margin, pro forma operating EBITDA margin, operating earnings per share, pro forma operating earnings per share, base tax rate and pro forma base tax rate. Management uses these measures internally for planning and forecasting, including allocating resources and evaluating incentive compensation. Management believes that these non-GAAP measures reflect the ongoing performance of the Company during the periods presented and provide more relevant and meaningful information to investors as they provide insight with respect to ongoing operating results of the Company and a more useful comparison of year over year results.

These non-GAAP measures supplement the Company's U.S. GAAP disclosures and should not be viewed as an alternative to U.S. GAAP measures of performance. Furthermore, such non-GAAP measures may not be consistent with similar measures provided or used by other companies. For first quarter 2019, these non-GAAP measures are being reconciled to a pro forma GAAP financial measure prepared and presented in accordance with Article 11 of Regulation S-X. Reconciliations for these non-GAAP measures to their most directly attributable U.S. GAAP measure are provided on slides 24 - 32 of this presentation.

Corteva is not able to reconcile its forward-lookingnon-GAAP financial measures to their most comparable U.S. GAAP financial measures, as it is unable to predict with reasonable certainty items outside of the company's control, such as Significant Items, without unreasonable effort. For Significant Items reported in the periods presented, refer to slide 26. Beginning January 1, 2020, the company presents accelerated prepaid royalty amortization expense as a significant item. Accelerated prepaid royalty amortization represents the noncash charge associated with the recognition of upfront payments made to Monsanto in connection with the Company's non-exclusive license in the United States and Canada for Monsanto's Genuity® Roundup Ready 2 Yield® Roundup Ready 2 Xtend® herbicide tolerance traits. During the five-yearramp-up period of Enlist E3TM, Corteva is expected to significantly reduce the volume of products with the Roundup Ready 2 Yield® and Roundup Ready 2 Xtend® herbicide tolerance traits beginning in 2021, with expected minimal use of the trait platform after the completion of the ramp-up.

Organic sales is defined as price and volume and excludes currency and portfolio impacts. Operating EBITDA is defined as earnings (i.e., income from continuing operations before income taxes) before interest, depreciation, amortization, non-operating benefits, net and foreign exchange gains (losses), net, excluding the impact of significant items (including goodwill impairment charges). Non-operating benefits, net consists of non-operating pension and other post-employment benefit (OPEB) credits, tax indemnification adjustments, environmental remediation and legal costs associated with legacy businesses and sites of Historical DuPont. Tax indemnification adjustments relate to changes in indemnification balances, as a result of the application of the terms of the Tax Matters Agreement, between Corteva and Dow and/or DuPont that are recorded by the company as pre-tax income or expense. Operating EBITDA margin is defined as Operating EBITDA as a percentage of net sales. Operating earnings per share are defined as "Earnings per common share from continuing operations - diluted" excluding the after-tax impact of significant items (including goodwill impairment charges), the after-tax impact of non-operating benefits, net, and the after-tax impact of amortization expense associated with intangible assets existing as of the Separation from DowDuPont. Although amortization of the Company's intangible assets is excluded from these non-GAAP measures, management believes it is important for investors to understand that such intangible assets contribute to revenue generation. Amortization of intangible assets that relate to past acquisitions will recur in future periods until such intangible assets have been fully amortized. Any future acquisitions may result in amortization of additional intangible assets. Base tax rate is defined as the effective tax rate excluding the impacts of foreign exchange gains (losses), net, non-operating benefits, net, amortization of intangibles as of the Separation from DowDuPont, and significant items (including goodwill impairment charges). The first quarter of 2019 is on a pro forma basis as discussed above in the paragraph 'Corteva Unaudited Pro Forma Financial Information'.

3

Next Stage on Our Journey to Drive Growth

1

2

3

4

Delivering

Driving actions to

Fortifying currency

Accelerating return

organic(1)

expand margins in

risk management

of cash to

sales growth

both segments

practices

shareholders

Expect to deliver earnings growth aligned with mid-term targets

(1) Organic sales is a non-GAAP measures. See slide 3 for further discussion.

4

Focused Execution to Deliver Continued Growth

2020 Financial Results

Measure

Net Sales

Organic(1) Sales

Operating

EBITDA(1), (2)

Operating EBITDA

Margin(1)

Q3 2020

2020 YTD

(3)%1%

9%6%

14%5%

122 bps

58 bps

Highlights

Net sales decline in the quarter driven by ~$200 million in currency headwinds

Volume and price improvement offsetting ~$470 million currency impact year-to-date

Double digit organic(1) growth on volume and price in Crop Protection in the quarter

Year-to-date organic(1) growth in every region and both segments

Strong volume and price growth in Crop Protection, offset the currency headwind for the quarter, partially reversing first half headwind

Seed driving year-to-date improvement

Delivered margin expansion on higher sales and continued realization of merger-related synergies and productivity

Overcoming COVID-related headwinds to drive margin expansion

  1. Organic sales, Operating EBITDA and Operating EBITDA Margin are non-GAAP measures. See slide 3 for further discussion.
  2. Loss from Continuing Ops after income taxes was $(390) million and $(527) million for the three months ended September 30, 2020 and 2019, respectively, on net sales of $1,863 million and $1,911 million, respectively. Income from Continuing Ops after income taxes was $657 million and $68 million for the nine months ended September 30, 2020 and 2019, respectively, on net sales of $11,010 million and $10,863 million, respectively.

5

Driving Actions to Expand Seed Margin and Return on Investment

Seed Segment Results

Key Mid-Term Growth Drivers

Net Sales

Operating EBITDA

Low single digit seed price

improvement year-to-date

3Q 2020

Continued pricing

$0.7B

for value

Reported

Launched the 2021 price cards

for the North America season

23%

$0.5B

Organic(1)

14%

-$0.28B

Successful Qrome® corn

-$0.30B

Launching proprietary

launch

3Q'19

3Q'20

technology

Secured access to additional

3Q'19

3Q'20

Volume

Price

Currency

Portfolio

seed units to support Enlist

(11)%

(3)%

(9)%

-%

E3™(2) launch next year

2020 YTD

Strong corn product

$6.3B

$6.5B

Reported

3%

Organic(1)

6%

$1.26B

$1.07B

Brevant retail penetration

performance in retail trials

Solid Enlist E3™(2) and EnlistTM herbicides order pace

3Q'19 YTD

3Q'20 YTD

Volume

Price

Currency

Portfolio

4%

2%

(3)%

-%

3Q'19 YTD

3Q'20 YTD

Productivity actions

Delivered >$80 million in

merger cost savings and

productivity year-to-date

(1)

Organic sales is a non-GAAP measures. See slide 3 for further discussion.

(2)

The transgenic soybean event in Enlist E3® soybeans is jointly developed and owned by Dow AgroSciences LLC and M.S. Technologies, L.L.C. Royalty income for Enlist E3® is shared with MS Technologies.

6

Accelerating the Transition to Our Technology Offerings in Soybeans

2020

20%

17%

10%

70%

Industry penetration

Corteva soybean

Corteva germplasm

Enlist acres treated

for Enlist E3™(1) soybeans

portfolio

penetration

with Enlist

TM

herbicides

Enlist E3™(1) soybeans

in Corteva Enlist E3TM(1) units

2021

~30%

>35%

~25%

>70%

Industry penetration

Corteva soybean

Corteva germplasm

Enlist acres treated

for Enlist E3™(1) soybeans

portfolio

penetration

with EnlistTM herbicides

Enlist E3™(1) soybeans

in Corteva Enlist E3TM(1) units

Taking actions to accelerate conversion to proprietary technology

(1) The transgenic soybean event in Enlist E3® soybeans is jointly developed and owned by Dow AgroSciences LLC and M.S. Technologies, L.L.C. Royalty income for Enlist E3® is shared with MS Technologies.

7

Solid Progress to Re-Establish Momentum in Crop Protection

Crop Protection Segment Results

Net Sales

Operating EBITDA

3Q 2020

$1.2B

$1.3B

Reported

9%

$0.12B

$0.13B

Organic(1)

21%

3Q'19

3Q'20

3Q'19

3Q'20

Volume

Price

Currency

Portfolio

16%

5%

(11)%

(1)%

2020 YTD

Key Mid-Term Growth Drivers

New product

Delivered > $180 million in

organic(1)

net sales growth from

launches

new products year-to-date

Year-to-date organic(1) sales

Scaling spinosyn

growth, up over 20%

capacity

Capacity expansion enabling

gains in Latin America and

Asia Pacific

Manufacturing

Completed 9 asset shutdowns

and 15 site optimizations since

footprint optimization

merger close

$4.5B

$4.5B

Reported

Flat

Organic(1)

7%

3Q'19 YTD

3Q'20 YTD

Volume

Price

Currency

Portfolio

5%

2%

(6)%

(1)%

$0.79B

$0.68B

3Q'19 YTD

3Q'20 YTD

Expect ~$150 million in cost

savings(2) next year from actions

Strategic product

Exiting chlorpyrifos, which

exits and divestitures

created ~$60 million in sales

volume headwind year-to-date

(1)

Organic sales is a non-GAAP measures. See slide 3 for further discussion.

(2)

Represents savings from merger-related synergies and productivity initiatives.

8

Streamlining the CP Manufacturing Assets Inherited at Spin

2017

29

Strong Bias Toward

Formulation &

Manufacturing Assets

Inherited Structure

Internal Active Ingredient

Packaging Centralized

Workforce changes necessary to

Manufacturing

inherited from legacy companies

F&P manufacturing footprint reflected

support new operating model

cost-improvement opportunities in active

combined footprint at merger close

ingredient manufacturing at merger close

2020

20

Streamlined

De-Centralized

Optimized

Manufacturing Assets

Formulation &

Active Ingredient

Manufacturing Roles

Packaging

Manufacturing

after completed and targeted

Achieved 25% reduction as a result of

Close to end-use markets to enhance

shutdowns

Increase external active ingredient

merger synergies

customer responsiveness and capitalize

manufacturing while balancing IP protection

on local currency

Taking actions to deliver incremental savings in CP manufacturing

9

Scanning the Market Backdrop for Constructive Signals

Commodity

Supply &

Demand

Corn and soybean prices above pre- COVID levels

Monitoring ethanol recovery

Trade

Strong China purchases of U.S. corn and soybeans

Monitoring trade flows in other key markets

Currency

Farm Income

Monitoring

Government

Brazilian Real

payments in

and European

U.S. have lifted

currencies

farm income

Monitoring market fundamentals amidst persistent uncertainty

10

Affirming Full Year 2020 Guidance

Net Sales

Operating EBITDA(1), (2)

$ in billions

$ in millions

Operating EPS(2)

$1.43

$1.25 - 1.45

$13.8B

$13.9 - $14.1B

FY'19

FY'20E

$1,987 $1,900 - $2,000

FY'19 (3)

FY'20E

FY'19 (3)

FY'20E

Sales Growth

Reported 1-2% Organic(2) 5-6%

Full-Year Expectations

Op. EBITDA(2) vPY

Operating EPS(2) vPY

FY19 includes ~$70 million in one-time gains

Mid-point

6%

from divestitures

~$400 million Operating EBITDA

Currency headwind, predominately BRL, partially offset by >$120 million pricing for currency

New

Crop Protection

Products

$250 million in organic(2) sales

Synergies/Productivity on track to

deliver $230 million earnings

growth; $75 million of

Costs

improvement

earnings, net of ~$60 million

Expect SG&A and R&D to be relatively

in currency

flat

YTD performance underscores operational momentum to deliver on full year guidance

  1. Guidance does not contemplate any further operational disruptions, significant changes in customers' demand or ability to pay, or further acceleration of currency impacts resulting from the COVID-19 pandemic or political instability.
  2. Organic Sales, Operating EBITDA and Operating EPS are non-GAAP measures. See slide 3 for further discussion.
  3. Full year 2019 information is on a pro forma basis and was determined in accordance with Article 11 of Regulation S-X.

11

Focused on Continued Execution and 2021 Setup

Growth Drivers

Seed Growth

  • Current commodity price levels indicate relatively flat corn acreage and soybean acreage increase in North America
  • Continued execution on price for value strategy globally, with mix improvements from further penetration of Qrome®
  • Strong momentum on Enlist E3TM1 penetration and Brevant launch

Crop Protection Growth

  • Continued ramp-up of new product sales, led by ArylexTM and EnlistTM herbicides and IsoclastTM insecticide
  • Volume growth in Spinosyns as capacity expansion continues

Currency

  • Headwind in 1H'21 related to BRL
  • Continued pricing for currency in Latin America

Synergies / Productivity

  • Final tranche of merger-related synergies - $200 million for 2021 to achieve $1.2B run-rate
  • Productivity improvements of ~$50 million, led by Crop Protection
  • Majority of COVID related savings expected to be sustained in 2021

Costs of Goods Sold

  • For Seed, monitoring yields and quality on North America harvest to evaluate any possible tailwinds from 2020 yield impacts

Portfolio Management

  • Slight headwinds on continued strategic rationalization of Crop Protection portfolio

Operational execution and acceleration of market opportunities key to 2021 growth

(1) The transgenic soybean event in Enlist E3® soybeans is jointly developed and owned by Dow AgroSciences LLC and M.S. Technologies, L.L.C. Royalty income for Enlist E3® is shared with MS Technologies.

12

Update on Currency Management

Objective: Decrease earnings volatility associated with exchange rates

Strategy

Reduce FX earnings and cash flow volatility and improve forecast ability

Reduce FX exposure by increasing natural hedges or transferring currency risk

Choose a hedging program that delivers volatility risk reduction while minimizing costs

Apply strategy consistently with no market speculation

Mitigate and Transfer

Utilize business management levers to reduce FX exposure

  • Pricing actions to set customer price in USD or adjust price in local currency to recoup losses
  • Natural hedging strategies
  • Risk transfer of FX exposure to customers, suppliers, etc.
  • Operational adjustments to incur more costs in same currency as related revenues (longer-term)

Constant Monitoring

Address intra-year timing differences between order placement (when price is fixed) and delivery (when revenue is recognized)

Hedge Exposures

Cash flow hedging: Protect transactional EBITDA value when COGS and revenues are in different currencies

EBITDA hedging: Protect translational value of non-USD EBITDA

Balance sheet hedging: Protect Operating Earnings and EPS impact of net monetary asset

MTM

Cost Effective and Principle Based Hedging Strategy

13

Disciplined Approach To Capital Allocation

Since Spin:

Focused Investment

Growth Investments

Investments in route-to-market and multi-channel /multi-brand strategy

New product launches and ramp-up globally

Opportunistic acquisition of full-ownership of Phytogen JV

$145 million in capital committed to capacity expansion of Spinosyns insecticides

ERP harmonization investment to align disparate IT systems

Looking Forward:

Enhance Capital Return

Maintain Competitive Dividend

$485 million in dividends since Spin

Continue to target 25-35% of net income with earnings and cash flow growth

Accelerate Share Repurchases

~$200 million(1) in share repurchases since Spin despite COVID environment

The company now expects to complete the $1B share repurchase program in 2021, contingent upon market conditions

>$1 billion(2) in capital deployment since Spin aligned with strategy to generate shareholder value

  1. Cumulative repurchases under current program as of October 30, 2020
  2. Amount includes investments for growth, including route-to-market and branding investments, dividends, share repurchases, cash paid for acquisitions, growth-related capital expenditures and costs/capital for ERP harmonization

14

3Q 2020 Highlights

($'s in millions, except EPS)

3Q 2019

3Q 2020

Change

Net Sales

$1,911

$1,863

(3)%

GAAP Loss from Continuing Operations After Income Taxes

$(527)

$(390)

26%

Operating EBITDA(1)

$(207)

$(179)

14%

Operating EBITDA Margin(1)

(10.8)%

(9.6)%

122 bps

GAAP EPS from Continuing Operations

$(0.69)

$(0.52)

25%

Operating EPS(1)

$(0.39)

$(0.39)

Flat

3Q 2020 Net Sales Bridge ($ in millions)

$1,911

$1,863

3Q 2019

North

(1)

Latin

(1)

EMEA

(1)

Asia

(1)

Portfolio

Currency

3Q 2020

America

America

Pacific

3Q 2020 Operating EBITDA (1) Bridge ($ in millions)

$(207)

$(179)

3Q 2019 Portfolio

Currency

Volume

Price

Production

Non-

Other

3Q 2020

Production

Costs(2)

Costs(3)

Operating EBITDA margin expansion despite currency headwinds and seasonal shifts

  1. Organic sales, Operating EBITDA, Operating EBITDA margin and Operating earnings per share are non-GAAP measures. See slide 3 for further discussion.
  2. Production costs are net of synergies realized in the period.
  3. Non-ProductionCosts includes costs such as selling, leveraged function costs and product development, net of synergies realized in the period.

16

3Q 2020 Operating EPS(1) Variance

Operating EPS(1) Bridge ($)

$0.03

$(0.06)

$0.02

$(0.02)

$(0.39)

$0.03

($0.39)

($0.11)

$0.11

1

2

3

Costs(2)

4

5

6

(4)

3Q'19

Currency

Volume/Price

Production

Non-Production

Change in Base

EGL

Other/Portfolio

3Q'20

Costs (3)

Tax Rate (1)

Currency

1

  • Currency headwinds predominately from Brazilian Real

Non-Production Costs(3)

4

  • Lower commissions on seasonal volume shifts, partially offset by increased investment in R&D

Volume/Price

  • Gains driven by strong demand for new crop protection products globally

Change in Base Tax Rate(1)

  • 3Q'20 Base Income Tax Rate: 19.2%
  • 3Q'19 Base Income Tax Rate: 11.8%

2

5

Production Costs(2)

3

  • Continued realization of merger-related synergies
  • On-goingproductivity actions

EGL(4)

6

  • After-taxexchange losses on Argentina devaluation and balance sheet hedging program
  1. Operating earnings per share and base tax rate are non-GAAP measures. See slide 3 for further discussion. GAAP EPS for the third quarter 2019 and 2020 was $(0.69) and $(0.52), respectively
  2. Production costs are net of synergies realized in the period.
  3. Non-ProductionCosts includes costs such as selling, leveraged function costs and product development, net of synergies realized in the period.
  4. EGL is defined as Exchange Gain / (Loss)

17

3Q 2020 Regional Net Sales Highlights - Crop Protection

Global Net Sales

$1.3B

$1.2B

Reported

9%

Organic(1)

21%

3Q'19

3Q'20

Volume

Price

Currency

Portfolio

16%

5%

(11)%

(1)%

  1. Organic sales growth is a non-GAAP measure. See slide 3 for further discussion.
  2. North America is defined as U.S. and Canada.
  3. EMEA Is defined as Europe, Middle East and Africa.

North

Reported

Organic(1)

America(2)

2%

2%

3Q 2019

3Q 2020

Net Sales ($MM)

$397

$390

Volume Price Currency Portfolio

(3)% 1% -%-%

Volume declines driven by competitive herbicide market and shift of seed applied technologies to 4Q20

Strong early adoption of EnlistTM herbicides

EMEA(3)

Reported Organic(1)

8%

8%

3Q 2019

3Q 2020

Net Sales ($MM)

$183

$198

Volume

Price

Currency

Portfolio

4%

4%

-%

-%

Continued penetration of new products, including ArylexTM herbicide and ZorvecTM fungicide

Phase out of regulatory challenged products suppressing growth

Latin

Reported

Organic(1)

America

14%

43%

3Q 2019

3Q 2020

Net Sales ($MM)

$491

$559

Volume

Price

Currency

Portfolio

34%

9%

(29)%

-%

Strong demand for new products, including IsoclastTM insecticide, RinskorTM herbicide, and Vessarya® fungicide

Currency impact from Brazilian Real partially offset by pricing actions

Asia

Reported Organic(1)

Pacific

21%

27%

3Q 2019

3Q 2020

Net Sales ($MM)

$159

$193

Volume

Price

Currency Portfolio

24%

3%

(1)%

(5)%

Volume growth due to favorable monsoon conditions in India

Ramp up of new technologies, including ArylexTM herbicide and PyraxaltTM and IsoclastTM insecticide

18

3Q 2020 Regional Net Sales Highlights - Seed

Global Net Sales

North

Reported

Organic(1)

Latin

Reported

Organic

(1)

America(2)

57%

55%

America

9%

7%

$0.7B

Reported

$0.5B

23%

Organic(1)

14%

3Q 2019

3Q 2020

Net Sales ($MM)

$226

$97

Volume

Price

Currency

Portfolio

(44)%

(11)%

(2)%

-%

Lower volumes on more normalized season as compared to prior year

Pricing pressure due to timing of end of season customer settlements.

3Q 2019

3Q 2020

Net Sales ($MM)

$271

$246

Volume

Price

Currency

Portfolio

9%

(2)%

(16)%

-%

Volume growth on strong summer and early safrinha sales in Brazil coupled with higher volumes in Colombia and Mexico

Pricing for currency in Brazil more than offset by lower local price in Argentina

3Q'19

3Q'20

Volume

Price

Currency

Portfolio

(11)%

(3)%

(9)%

-%

Reported

Organic(1)

EMEA(3)

4%

6%

3Q 2019

3Q 2020

Net Sales ($MM)

$122

$117

Volume

Price

Currency

Portfolio

-%

6%

(10)%

-%

Asia

Reported Organic(1)

Pacific

2%

2%

3Q 2019

3Q 2020

Net Sales ($MM)

$62

$63

Volume

Price

Currency Portfolio

3%

(1)%

-%

-%

  1. Organic sales growth is a non-GAAP measure. See slide 3 for further discussion.
  2. North America is defined as U.S. and Canada.
  3. EMEA Is defined as Europe, Middle East and Africa.

Price increases across most crops

Unfavorable currency impact due to the Zambian Kwacha

Market share gains and market penetration drove volume gains in corn in India

Favorable monsoon conditions drove volume and price gains in rice in India

19

3Q YTD 2020 Highlights

($'s in millions, except EPS)

3Q YTD 2019(2)

3Q YTD 2020

Change

Net Sales

$10,863

$11,010

1%

GAAP Income from Continuing Operations After Income Taxes

$68

$657

866%

Operating EBITDA(1)

$1,763

$1,851

5%

Operating EBITDA Margin(1)

16.2%

16.8%

58 bps

GAAP EPS from Continuing Operations

$0.08

$0.85

963%

Operating EPS(1)

$1.36

$1.46

7%

3Q YTD 2020 Net Sales Bridge ($ in millions)

$11,010

$10,863

3Q YTD

North

(1)

Latin

(1)

EMEA

(1)

Asia

(1)

Portfolio

Currency

3Q YTD

America

America

Pacific

2020

2019

3Q YTD 2020 Operating EBITDA (1) Bridge ($ in millions)

$1,851

$1,763

3Q YTD Portfolio

Currency Volume

Price

Production

Non-

Other

3Q YTD

Production

2019(2)

Costs(3)

2020

Costs(4)

Operating EBITDA and margin expansion from continued execution on pricing and cost savings

  1. Organic sales, Operating EBITDA, Operating EBITDA margin and Operating earnings per share are non-GAAP measures. See slide 3 for further discussion.
  2. Full year 2019 is on a pro forma basis and was determined in accordance with Article 11 of Regulation S-X.
  3. Production costs are net of synergies realized in the period.
  4. Non-ProductionCosts includes costs such as selling, leveraged function costs and product development, net of synergies realized in the period.

20

3Q YTD 2020 Regional Net Sales Highlights

North America(1)

Europe, Middle

Latin America

Asia Pacific

East, Africa

Net Sales

$5.80B

$5.82B

Reported

Flat

Organic(2)

1%

3Q YTD 19

3Q YTD 20

Volume

Price

Currency

Portfolio

1%

-%

(1)%

-%

$2.34B

$2.43B

Reported

4%

Organic (2)

8%

3Q YTD 19

3Q YTD 20

Volume

Price

Currency

Portfolio

6%

2%

(4)%

-%

$1.78B

Reported

$1.75B

1%

Organic (2)

17%

3Q YTD 19

3Q YTD 20

Volume

Price

Currency

Portfolio

11%

6%

(18)%

-%

Reported

$0.95B

$1.01B

7%

Organic (2)

13%

3Q YTD 19

3Q YTD 20

Volume

Price

Currency

Portfolio

11%

2%

(4)%

(2)%

Regional Highlights

Seed growth

New products, including Qrome®, proprietary seed treatment, and strong pricing discipline in soybeans

Successful launch of Enlist E3TM3on up to 20% of US soybean acres drove growth in EnlistTM herbicides sales

Soybean volume growth driven by area recovery

Above market growth

New route-to-market in Russia and Ukraine and share gains in Southern Europe drove volume and price gains in Seed

Strong demand for new products such as ArylexTM and RinskorTM herbicides

Headwinds as a result of phase out of regulatory challenged products suppressing growth

Currency volatility

Share gains in Brazil safrinha and summer seasons driving seed volume growth

Unfavorable currency impact from Brazilian Real partially offset by pricing actions and favorable mix

Strong demand for new products driving volume and price

New product demand

Double digit organic growth on volume and price improvements

Strong demand for corn and rice in India

Insecticide growth led by spinosyns and PyraxaltTM

1)

North America is defined as U.S. and Canada.

2)

Organic sales growth is a non-GAAP measure. See slide 3 for further discussion.

21

3)

The transgenic soybean event in Enlist E3® soybeans is jointly developed and owned by Dow AgroSciences LLC and M.S. Technologies, L.L.C. Royalty income for Enlist E3® is shared with MS Technologies.

3Q YTD 2020 Regional Net Sales Highlights - Crop Protection

Global Net Sales

North

Reported

Organic(1)

Latin

Reported

Organic(1)

America(2)

2%

1%

America

5%

15%

$4.5B

$4.5B

Reported

Flat

Organic(1)

7%

3Q YTD

3Q YTD

2019

2020

Net Sales ($MM)

$1,562

$1,528

Volume

Price

Currency

Portfolio

-%

(1)%

-%

(1)%

Volume flat as improved spring application season was offset by competitive herbicide market, coupled with early demand in 4Q'19

Strong early adoption of Enlist

3Q YTD

3Q YTD

2019

2020

Net Sales ($MM)

$1,144

$1,086

Volume

Price

Currency

Portfolio

8%

7%

(20)%

-%

Strong demand for new products, including IsoclastTM insecticide and RinskorTM herbicide

Currency impact from Brazilian Real partially offset by pricing actions

EMEA(3)

Reported

Organic(1)

Asia

Reported

Organic(1)

2%

6%

Pacific

6%

12%

3Q'19 YTD

3Q'20 YTD

Volume

Price

Currency

Portfolio

5%

2%

(6)%

(1)%

  1. Organic sales growth is a non-GAAP measure. See slide 3 for further discussion.
  2. North America is defined as U.S. and Canada.
  3. EMEA Is defined as Europe, Middle East and Africa.

3Q YTD

3Q YTD

2019

2020

Net Sales ($MM)

$1,136

$1,163

Volume

Price

Currency

Portfolio

5%

1%

(3)%

(1)%

Continued penetration of new products, including ArylexTM and RinskorTM herbicides

Unfavorable currency impact primarily due to Euro and Turkish lira

3Q YTD

3Q YTD

2019

2020

Net Sales ($MM)

$674

$717

Volume

Price

Currency

Portfolio

12%

-%

(3)%

(3)%

Ramp up of new technologies, including ArylexTM and RinskorTM herbicides and PyraxaltTM insecticide

Volume growth due to continued strong demand for insecticides, including spinosyns

22

3Q YTD 2020 Regional Net Sales Highlights - Seed

Global Net Sales

$6.3B

$6.5B

Reported

3%

Organic(1)

6%

3Q'19 YTD

3Q'20 YTD

Volume

Price

Currency

Portfolio

4%

2%

(3)%

-%

  1. Organic sales growth is a non-GAAP measure. See slide 3 for further discussion.
  2. North America is defined as U.S. and Canada.
  3. EMEA Is defined as Europe, Middle East and Africa.

North

Reported

Organic(1)

America(2)

1%

2%

3Q YTD

3Q YTD

2019

2020

Net Sales ($MM)

$4,238

$4,290

Volume

Price

Currency

Portfolio

1%

1%

(1)%

-%

Higher soybean volume on recovery of planted area

New products, including Qrome®, proprietary seed treatment, and strong pricing discipline, partially offset by higher sample

EMEA(3)

Reported

Organic(1)

5%

11%

3Q YTD

3Q YTD

2019

2020

Net Sales ($MM)

$1,200

$1,262

Volume

Price

Currency

Portfolio

7%

4%

(6)%

-%

Volume growth on record corn sales driven by route-to-market in Eastern Europe and share gains in Southern Europe

Improved pricing from route-to-market changes offset by currency

Latin

Reported Organic(1)

America

5%

20%

3Q YTD

3Q YTD

2019

2020

Net Sales ($MM)

$636

$668

Volume

Price

Currency Portfolio

15%

5%

(15)%

-%

Volume growth on strong summer and early safrinha sales in Brazil coupled with higher volumes in Colombia and Mexico

Currency impact from Brazilian Real partially offset by pricing actions and improved mix

Asia

Reported Organic(1)

Pacific

8%

14%

3Q YTD

3Q YTD

2019

2020

Net Sales ($MM)

$273

$296

Volume

Price

Currency Portfolio

8%

6%

(6)%

-%

Market share gains and market penetration drove volume gains in corn in India and Pakistan

Favorable monsoon conditions drove volume and price gains in rice in India

23

Corteva

Non-GAAP Calculation of Corteva Operating EBITDA

Three Months Ended September 30,

Nine Months Ended September 30,

2020

2019

2020

2019

In millions

As Reported

As Reported

As Reported

Pro Forma

(Loss) income from continuing operations, net of tax (GAAP)

$

(390)

$

(527)

$

657

$

68

(Benefit from) provision for income taxes on continuing operations

(117)

(104)

88

146

(Loss) income from continuing operations before income taxes (GAAP)

$

(507)

$

(631)

$

745

$

214

+ Depreciation and Amortization

285

226

868

711

- Interest income

(11)

(13)

(38)

(46)

+ Interest expense

11

19

35

67

+ / - Exchange losses (gains), net2

67

(22)

127

37

+ / - Non-operating benefits, net

(73)

(32)

(237)

(106)

+ Significant items charge

49

246

351

886

Corteva Operating EBITDA (Non-GAAP)1

$

(179)

$

(207)

$

1,851

$

1,763

1. Corteva Operating EBITDA is defined as earnings (i.e., income from continuing operations before income taxes) before interest, depreciation, amortization, non-operating benefits (costs) - net and foreign exchange gains (losses), excluding the impact of significant items. Non-operating benefits (costs) - net consists of non-operating pension and other post-employment benefit (OPEB) credits (costs), tax indemnification adjustments, environmental remediation and legal costs associated with Historical DuPont businesses and sites. Tax indemnification adjustments relate to changes in indemnification balances, as a result of the application of the terms of the Tax Matters Agreement, between Corteva and Dow and/or DuPont that are recorded by the company as pre-tax income or expense.

2. The three and nine months ended September 30, 2019, on an operating basis (Non-GAAP), exclude a $(33) million exchange loss associated with the devaluation of the Argentine peso, as it is included within significant items.

24

Corteva

Segment Information

Net sales by segment

Three Months Ended September 30,

Nine Months Ended September 30,

In millions

2020

2019

2020

2019

Seed

$

523

$

681

$

6,516

$

6,347

Crop Protection

1,340

1,230

4,494

4,516

Total net sales

$

1,863

$

1,911

$

11,010

$

10,863

Corteva Operating EBITDA

Three Months Ended September 30,

Nine Months Ended September 30,

2020

2019

2020

2019

In millions

As Reported

As Reported

As Reported

Pro Forma

Seed

$

(282)

$

(295)

$

1,255

$

1,066

Crop Protection

130

119

677

789

Corporate

(27)

(31)

(81)

(92)

Corteva Operating EBITDA (Non-GAAP)1

$

(179)

$

(207)

$

1,851

$

1,763

1. Corteva Operating EBITDA is defined as earnings (i.e., income from continuing operations before income taxes) before interest, depreciation, amortization, non-operating benefits (costs) - net and foreign exchange gains (losses), excluding the impact of significant items. Non-operating benefits (costs) - net consists of non-operating pension and other post- employment benefit (OPEB) credits (costs), tax indemnification adjustments, environmental remediation and legal costs associated with Historical DuPont businesses and sites. Tax indemnification adjustments relate to changes in indemnification balances, as a result of the application of the terms of the Tax Matters Agreement, between Corteva and Dow and/or DuPont that are recorded by the company as pre-tax income or expense.

Operating EBITDA margin

Three Months Ended September 30,

Nine Months Ended September 30,

2020

2019

2020

2019

As Reported

As Reported

As Reported

Pro Forma

Seed

-53.9%

-43.3%

19.3%

16.8%

Crop Protection

9.7%

9.7%

15.1%

17.5%

Total Operating EBITDA margin (Non-GAAP)2,3

-9.6%

-10.8%

16.8%

16.2%

2. Operating EBITDA margin is Operating EBITDA as a percentage of net sales.

3. Operating EBITDA margin %'s for Corporate are not presented separately above as they are not meaningful; however, the results are included in the Total margin %'s above.

25

Corteva significant items (Pretax)

Three Months Ended September 30,

Nine Months Ended September 30,

2020

2019

2020

2019

In millions

As Reported

As Reported

As Reported

Pro Forma

Seed

Loss on divestiture

-

-

-

(24)

Restructuring and asset-related charges - net

(9)

(47)

(154)

(123)

Amortization of inventory step up

-

(15)

-

(67)

Total Seed

(9)

(62)

(154)

(214)

Crop Protection

Loss on divestiture

-

-

(53)

-

Restructuring and asset-related charges - net

(40)

1

(98)

(24)

Total Crop Protection

(40)

1

(151)

(24)

Corporate

Integration and separation costs

-

(152)

-

(582)

Loss on early extinguishment of debt

-

-

-

(13)

Restructuring and asset-related charges - net

-

-

(46)

(20)

Argentina devaluation

-

(33)

-

(33)

Total Corporate

-

(185)

(46)

(648)

Total significant items by segment (Pretax)

(49)

(246)

(351)

(886)

Total tax impact of significant items

22

40

81

52

Tax only significant items

-

38

10

38

Total significant items charge, net of tax 1

$

(27)

$

(168)

$

(260)

$

(796)

1. Refer to page A-11 of the Financial Statement Schedules for further information on significant items, including tax only items.

26

Corteva

Segment Information - Price, Volume Currency Analysis

Region

Q3 2020 vs. Q3 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$

(millions)

%

$

(millions)

%

Product Mix

Volume

Currency

Portfolio / Other

North America1

$

(136)

-22%

$

(134)

-22%

-4%

-18%

0%

0%

EMEA1

10

3%

22

7%

4%

3%

-4%

0%

Latin America

43

6%

230

30%

5%

25%

-24%

0%

Asia Pacific

35

16%

44

20%

1%

19%

-1%

-3%

Rest of World

88

7%

296

23%

5%

18%

-15%

-1%

Total

$

48

-3%

$

162

9%

2%

7%

-11%

-1%

Seed

Q3 2020 vs. Q3 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$

(millions)

%

$

(millions)

%

Product Mix

Volume

Currency

Portfolio / Other

North America1

$

(129)

-57%

$

(125)

-55%

-11%

-44%

-2%

0%

EMEA1

(5)

-4%

7

6%

6%

0%

-10%

0%

Latin America

(25)

-9%

19

7%

-2%

9%

-16%

0%

Asia Pacific

1

2%

1

2%

-1%

3%

0%

0%

Rest of World

(29)

-6%

27

6%

0%

6%

-12%

0%

Total

$

(158)

-23%

$

(98)

-14%

-3%

-11%

-9%

0%

Crop Protection

Q3 2020 vs. Q3 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$ (millions)

%

$ (millions)

%

Product Mix

Volume

Currency

Portfolio / Other

North America1

$

(7)

-2%

$

(9)

-2%

1%

-3%

0%

0%

EMEA1

15

8%

15

8%

4%

4%

0%

0%

Latin America

68

14%

211

43%

9%

34%

-29%

0%

Asia Pacific

34

21%

43

27%

3%

24%

-1%

-5%

Rest of World

117

14%

269

32%

7%

25%

-17%

-1%

Total

$

110

9%

$

260

21%

5%

16%

-11%

-1%

  1. North America is defined as U.S. and Canada. EMEA is defined as Europe, Middle East and Africa.
  2. Organic sales is defined as price and volume and excludes currency and portfolio impacts.

27

Corteva

Segment Information - Price, Volume Currency Analysis

Region

Nine Months Ended September 30, 2020 vs. Nine Months Ended September 30, 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$ (millions)

%

$ (millions)

%

Product Mix

Volume

Currency

Portfolio / Other

North America1

$

18

0%

$

45

1%

0%

1%

-1%

0%

EMEA1

89

4%

195

8%

2%

6%

-4%

0%

Latin America

(26)

-1%

296

17%

6%

11%

-18%

0%

Asia Pacific

66

7%

119

13%

2%

11%

-4%

-2%

Rest of World

129

3%

610

12%

4%

8%

-9%

0%

Total

$

147

1%

$

655

6%

2%

4%

-4%

-1%

Seed

Nine Months Ended September 30, 2020 vs. Nine Months Ended September 30, 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$ (millions)

%

$ (millions)

%

Product Mix

Volume

Currency

Portfolio / Other

North America1

$

52

1%

$

65

2%

1%

1%

-1%

0%

EMEA1

62

5%

126

11%

4%

7%

-6%

0%

Latin America

32

5%

124

20%

5%

15%

-15%

0%

Asia Pacific

23

8%

37

14%

6%

8%

-6%

0%

Rest of World

117

6%

287

14%

5%

9%

-8%

0%

Total

$

169

3%

$

352

6%

2%

4%

-3%

0%

Crop Protection

Nine Months Ended September 30, 2020 vs. Nine Months Ended September 30, 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$

(millions)

%

$

(millions)

%

Product Mix

Volume

Currency

Portfolio / Other

North America1

$

(34)

-2%

$

(20)

-1%

-1%

0%

0%

-1%

EMEA1

27

2%

69

6%

1%

5%

-3%

-1%

Latin America

(58)

-5%

172

15%

7%

8%

-20%

0%

Asia Pacific

43

6%

82

12%

0%

12%

-3%

-3%

Rest of World

12

0%

323

11%

3%

8%

-10%

-1%

Total

$

(22)

0%

$

303

7%

2%

5%

-6%

-1%

  1. North America is defined as U.S. and Canada. EMEA is defined as Europe, Middle East and Africa.
  2. Organic sales is defined as price and volume and excludes currency and portfolio impacts.

28

Corteva

Segment Information - Price, Volume Currency Analysis

Seed Product Line

Q3 2020 vs. Q3 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$

(millions)

%

$ (millions)

%

Product Mix

Volume

Currency

Portfolio / Other

Corn

$

(69)

-18%

$

(30)

-8%

-2%

-6%

-10%

0%

Soybeans

(52)

-31%

(33)

-20%

14%

-34%

-11%

0%

Other oilseeds

18

41%

20

45%

36%

9%

-4%

0%

Other oilseeds

(55)

-57%

(55)

-56%

-58%

2%

-1%

0%

Total

$

(158)

-23%

$

(98)

-14%

-3%

-11%

-9%

0%

Crop Protection Product Line

Q3 2020 vs. Q3 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$ (millions)

%

$ (millions)

%

Product Mix

Volume

Currency

Portfolio / Other

Herbicides3

$

9

2%

$

62

11%

0%

11%

-8%

-1%

Insecticides3

65

20%

99

30%

4%

26%

-10%

0%

Fungicides3

16

7%

74

30%

10%

20%

-23%

0%

Other3

20

25%

25

31%

24%

7%

-6%

0%

Total

$

110

9%

$

260

21%

5%

16%

-11%

-1%

2. Organic sales is defined as price and volume and excludes currency and portfolio impacts.

3. Prior periods have been reclassified to conform to current period presentation.

29

Corteva

Segment Information - Price, Volume Currency Analysis

Seed Product Line

Nine Months Ended September 30, 2020 vs. Nine Months Ended September 30, 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$

(millions)

%

$

(millions)

%

Product Mix

Volume

Currency

Portfolio / Other

Corn

$

75

2%

$

211

5%

2%

3%

-3%

0%

Soybeans

85

7%

106

8%

3%

5%

-1%

0%

Other oilseeds

60

13%

78

17%

10%

7%

-4%

0%

Other oilseeds

(51)

-12%

(43)

-10%

-11%

1%

-2%

0%

Total

$

169

3%

$

352

6%

2%

4%

-3%

0%

Crop Protection Product Line

Nine Months Ended September 30, 2020 vs. Nine Months Ended September 30, 2019

Percent Change Due To:

Net Sales Change (GAAP)

Organic Change (Non-GAAP)2

Local Price &

$

(millions)

%

$

(millions)

%

Product Mix

Volume

Currency

Portfolio / Other

Herbicides3

$

(23)

-1%

$

111

5%

1%

4%

-5%

-1%

Insecticides3

60

5%

137

12%

4%

8%

-6%

-1%

Fungicides3

(53)

-7%

46

6%

2%

4%

-11%

-2%

Other3

(6)

-2%

9

4%

5%

-1%

-6%

0%

Total

$

(22)

0%

$

303

7%

2%

5%

-6%

-1%

2. Organic sales is defined as price and volume and excludes currency and portfolio impacts.

3. Prior periods have been reclassified to conform to current period presentation.

30

Corteva

Non-GAAP Calculation of Corteva Operating EPS

Three Months Ended September 30,

2020

2019

2020

2019

$ (millions)

$ (millions)

EPS (diluted)

EPS (diluted)

As Reported

As Reported

As Reported

As Reported

Loss from continuing operations attributable to Corteva (GAAP)

$

(392)

$

(516)

$

(0.52)

$

(0.69)

Less: Non-operating benefits - net, after tax2

56

23

0.08

0.03

Less: Amortization of intangibles (existing as of Separation), after tax

(126)

(80)

(0.17)

(0.11)

Less: Significant items charge, after tax

(27)

(168)

(0.04)

(0.22)

Operating Loss (Non-GAAP)1

$

(295)

$

(291)

$

(0.39)

$

(0.39)

Nine Months Ended September 30,

2020

2019

2020

2019

$ (millions)

$ (millions)

EPS (diluted)

EPS (diluted)

As Reported

Pro Forma

As Reported

Pro Forma

Income from continuing operations attributable to Corteva (GAAP)

$

639

$

58

$

0.85

$

0.08

Less: Non-operating benefits - net, after tax2

180

84

0.24

0.11

Less: Amortization of intangibles (existing as of Separation), after tax

(377)

(250)

(0.50)

(0.33)

Less: Significant items charge, after tax

(260)

(796)

(0.35)

(1.06)

Operating Earnings (Non-GAAP)1

$

1,096

$

1,020

$

1.46

$

1.36

1. Operating earnings (loss) is defined as net income (loss) from continuing operations attributable to Corteva excluding the after-tax impact of significant items, non-operating benefits - net, and amortization of intangible assets (existing as of Separation). Although amortization of intangible assets (existing as of Separation) is excluded from these non-GAAP measures, management believes it is important for investors to understand that such intangible assets contribute to revenue generation. Amortization of intangible assets that relate to past acquisitions will recur in future periods until such intangible assets have been fully amortized. Any future acquisitions may result in amortization of additional intangible assets.

2. Non-operating benefits - net consists of non-operating pension and other post-employment benefit (OPEB) benefits (costs), tax indeminfication adjustments, environmental remediation and legal costs associated with legacy EID businesses and sites. Tax indemnification adjustments relate to changes in indemnification balances, as a result of the application of the terms of the Tax Matters Agreement, between Corteva and Dow and/or DuPont that are recorded by the company as pre-tax income or expense.

31

Corteva

Non-GAAP Calculation of Corteva Base Tax Rate

Three Months Ended September 30,

Nine Months Ended September 30,

2020

2019

2020

2019

As Reported

As Reported

As Reported

Pro Forma

(Loss) income from continuing operations before income taxes (GAAP)

$

(507)

$

(631)

$

745

$

214

Add: Significant items - charge

49

246

351

886

Non-operating benefits - net

(73)

(32)

(237)

(106)

Amortization of intangibles (existing as of Separation)

162

100

501

314

Less: Exchange (losses) gains, net2,3

(67)

22

(127)

(37)

(Loss) income from continuing operations before income taxes, significant

items, non-operating benefits - net, amortization of intangibles (existing as

of Separation), and exchange (losses) gains, net (Non-GAAP)

$

(302)

$

(339)

$

1,487

$

1,345

(GAAP)

$

(117)

$

(104)

$

88

$

146

Add: Tax benefits on significant items charge

22

78

91

90

Tax expenses on non-operating benefits - net

(17)

(9)

(57)

(22)

Tax benefits on amortization of intangibles (existing as of Separation)

36

20

124

64

Tax benefits (expenses) on exchange (losses) gains, net

18

(25)

3

(13)

(Benefit from) provision for income taxes on continuing operations before

significant items, non-operating benefits - net, amortization of intangibles

(existing as of Separation), and exchange (losses) gains, net (Non-GAAP)

$

(58)

$

(40)

$

249

$

265

Effective income tax rate (GAAP)

23.1%

16.5%

11.8%

68.2%

Significant items, non-operating benefits, and amortization of intangibles (existing as

of Separation) effect

-2.5%

-11.8%

6.3%

-46.9%

Tax rate from continuing operations before significant items, non-operating benefits

- net, and amortization of intangibles (existing as of Separation)

20.6%

4.7%

18.1%

21.3%

Exchange (losses) gains, net effect

-1.4%

7.1%

-1.4%

-1.6%

Base income tax rate from continuing operations (Non-GAAP)1

19.2%

11.8%

16.7%

19.7%

  1. Base income tax rate is defined as the effective income tax rate less the effect of exchange gains (losses), significant items, amortization of intangibles (existing as of Separation), and non- operating benefits - net.
  2. Refer to page A-16 of the Financial Statement Schedules for further information on exchange gains (losses).
  3. Pre-taxexchange gains (losses), net for the three and nine months ended September 30, 2019, on an operating basis (Non-GAAP), excludes a $(33) million exchange loss associated with the devaluation of the Argentine peso, as it is included within significant items.

32

Disclaimer

Corteva Inc. published this content on 04 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 November 2020 10:16:00 UTC


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Financials (USD)
Sales 2020 13 984 M - -
Net income 2020 583 M - -
Net cash 2020 1 710 M - -
P/E ratio 2020 47,2x
Yield 2020 1,26%
Capitalization 31 030 M 31 030 M -
EV / Sales 2020 2,10x
EV / Sales 2021 1,99x
Nbr of Employees 21 000
Free-Float 99,9%
Chart CORTEVA, INC.
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Technical analysis trends CORTEVA, INC.
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 23
Average target price 41,33 $
Last Close Price 41,65 $
Spread / Highest target 32,1%
Spread / Average Target -0,76%
Spread / Lowest Target -42,4%
EPS Revisions
Managers and Directors
NameTitle
James C. Collins Chief Executive Officer & Director
Gregory R. Page Non-Executive Chairman
Gregory R. Friedman Chief Financial Officer & Executive Vice President
Debra King Chief Information Officer & Senior Vice President
Sam Eathington Chief Technology Officer & Senior Vice President
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