Corteva, Inc. · NYSE:CTVA
Corteva — Investor Presentation (August 2019)
21 slides from Corteva's investor presentation, Aug 15, 2019
Slide 1: CFO Investor Presentation
CFO Investor Presentation August 15, 2019 Insert Risk Classification
Slide 2: Safe Harbor Regarding Forward-Looking Statements
Safe Harbor Regarding Forward-Looking Statements Forward-Looking Statements This presentation contains 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
Slide 3: A Reminder About Non-GAAP Financial Measures and Pro Forma Financial Information
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 and pri
Slide 4: Objectives for the Call Today
Objectives for the Call Today Highlights Supplemental 2019 financial modeling guidance Update to mid-term financial 2019 Mid-Term Cash and targets Modeling Financial Valuation Discussion around modeling debt obligations and Targets assumed liabilities Guidance Topics Exploration of operational Earni
Slide 5: Recent Company Filings
Recent Company Filings DECEMBER 2018 to MAY 2019 AUGUST 1, 2019 OCTOBER 2018 JUNE 1, 2019 AUGUST 6, 2019 Form 10 Amendments 2Q Earnings & 8K (3 Amendments and Final) Filing . Pro forma financial . Pro forma financial First 10Q Post- Spin Initial Form 10 statements* information – Spin Filing . Capita
Slide 6: Modeling Guidance – EPS Guidance and Cash Flow Indications
Modeling Guidance – EPS Guidance and Cash Flow Indications 2019 Modeling Updates Pre-Spin 2Q19 Earnings (in millions, except earnings per share or where noted) Guidance Guidance Income Statement Net Sales Flat Down 3% • Currency headwinds • Flat organic growth(1), offsetting NA weather impact Pro Fo
Slide 7: Modeling Guidance – Operating Earnings Per Share Bridge
Modeling Guidance – Operating Earnings Per Share Bridge (in millions, except per share information) 2Q19 Actual FY19 Guidance Sensitivities and Comments Net Sales 5,556 ~14,000 • Down 3 percent on reported basis; organic sales flat Corteva Pro Forma Operating 1,452 1,900 – 2,050 • Midpoint of 1,975,
Slide 8: North America Market Update
North America Market Update U.S. Planted Acreage (USDA) (1) Comments . (million acres) 2018 2019 2019 2019 Recent USDA data shows corn acres are expected to be up 0.9 million acres and soybean acres are expected to be down 12.5 million acres March June August relative to 2018 levels. . USDA August C
Slide 9: Merger Cost Synergy Progress
Merger Cost Synergy Progress Seed Production Commercial Headcount R&D Sites CP Manufacturing 2Q19 Highlights DWDP Sites Offices MERGER CLOSE • Realized cost synergies SEPTEMBER ~25,000 90 287 233 29 of approximately $115 2017 million for the three months ended June 30, 2019 • R&D expense was SEPTEMB
Slide 10: Mid-Term Targets – Cost Synergies and Productivity
Mid-Term Targets – Cost Synergies and Productivity Through Initiative 2018 2019E 2020E Beyond Drivers • Remaining merger cost ~$350 million ~$200 million ~$200 million savings primarily relate Merger-Related incremental incremental incremental to COGS improvements • Will be realized in the Cost Syne
Slide 11: Mid-Term Targets – Projects Launched to Improve Seed Productivity
Mid-Term Targets – Projects Launched in Several Areas to Improve Seed Productivity 1 Risk factor reduction Field Strategic and Marketing and Customer 2 production 1 business planning 6 sales Field Production 2 Parent seed Distribution and Improvement 5 supply chain Shipping / Returns Plant Productio
Slide 12: 2020 and Mid-Term Financial Targets
2020 and Mid-Term1 Financial Targets 2020 Mid-Term 2020 Operating EBITDA Growth – Directional Sales Expected to Exceed Market Growth Guide* ($ in millions) 2020E Corteva Total Revenue Growth3: Cost Synergies $200 Seed 3-5% Crop Protection 5-7% Productivity Programs $30 Total 4-6% Normalized NA Marke
Slide 13: Cash Flow – Seed Segment Seasonality
Cash Flow – Seed Segment Seasonality Fourth Quarter First Quarter • Conclusion of Southern Hemisphere season • Primarily NA and Europe • Potential early shipments to NA • Includes Brazil Safrinha • Potential early start to Safrinha • Largest use of cash to fund 14.4% • Receivables and Prepay collect
Slide 14: Valuation – Assumed Liabilities
Valuation – Assumed Liabilities Corteva Separation Agreement Chemours Separation Agreement Chemours Limited Sharing Agreement • • For a 5 year period beginning on July 6, Corteva will assume up to $200 million • Chemours will indemnify Corteva 2017, Chemours will annually pay the (threshold), and an
Slide 15: Valuation – Perspective on Enterprise Value Calculation
Valuation – Perspective on Enterprise Value Calculation Obligations Enterprise Value Calculation Share Price Total net unfunded Pension and 1 OPEB liability : $5.8 billion x Diluted Shares Outstanding Pension: $3.3 billion 2 OPEB: $2.5 billion = Equity Value + Total Debt and Operating Leases Expecte
Slide 16: Q&A
Q&A InsertAgriculture Risk Classification Division of DowDuPont 17
Slide 17: Calculation of Corteva Operating EBITDA
Corteva Selected Non-GAAP Calculation of Corteva Operating EBITDA Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 In millions As Reported Pro Forma Pro Forma Pro Forma Income from continuing operations, net of tax (GAAP) 1 $ 483 $ 968 $ 595 $ 1,145 Provision for income taxe
Slide 18: Price, Volume, Currency Analysis
Corteva Price, Volume, Currency Analysis Region Q2 2019 vs. Q2 2018 Percent Change Due To: 1 Net Sales Growth (GAAP) Organic Growth (Non-GAAP) Local Price & Portfolio / $ (millions) % $ (millions) % Product Mix Volume Currency Other North America $ (341) -8% $ (323) -8% -3% -5% —% —% EM EA (20) -3%
Slide 19: Calculation of Corteva Operating Earnings and Operating EPS
Corteva Selected Non-GAAP Calculation of Corteva Operating Earnings and Operating EPS Three Months Ended June 30, 2019 2018 2019 2018 $ (millions) $ (millions) EPS (diluted) EPS (diluted) As Reported Pro Forma As Reported Pro Forma Net income from continuing operations attributable to Corteva (GAAP)
Slide 20: Calculation of Corteva Base Tax Rate
Corteva Selected Non-GAAP Calculation of Corteva Base Tax Rate Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 As Reported Pro Forma Pro Forma Pro Forma Net income from continuing operations before income taxes (GAAP) $ 753 $ 1,161 $ 845 $ 1,367 Add: Significant items - cha
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