Document



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 
Date of Report (Date of Earliest Event Reported): August 1, 2019 
Corteva, Inc.
(Exact Name of Registrant as Specified in Its Charter)
 
Delaware
 
001-38710
 
82-4979096
(State or other jurisdiction
 
(Commission
 
(I.R.S. Employer
of Incorporation)
 
File Number)
 
Identification No.)
 
974 Centre Road, Building 735
Wilmington, Delaware 19805
(Address of principal executive offices)(Zip Code)
 
(302) 485-3000
(Registrant’s telephone number, including area code)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
o    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act: 
Title of each class
 
Trading Symbol(s)
 
Name of each exchange on which registered
Common Stock, par value $0.01 per share
 
CTVA
 
New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company o
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

 





Item 7.01 Regulation FD Disclosure.

On June 1, 2019, Corteva, Inc. (the “Company”) became an independent, publicly traded company through the previously announced separation (the “Corteva Distribution”) of the agriculture business of DowDuPont Inc. (“DowDuPont”) (now known as DuPont de Nemours Inc.). Previously, DowDuPont was formed on December 9, 2015, to effect an all-stock merger of equals strategic combination between The Dow Chemical Company ("Historical Dow") and E. I. du Pont de Nemours and Company (“Historical DuPont”). On August 31, 2017, Historical Dow and Historical DuPont each merged with wholly-owned subsidiaries of DowDuPont and became subsidiaries of DowDuPont (the “Merger”). Subsequent to the merger, Historical Dow and Historical DuPont engaged in a series of certain internal reorganization and realignment steps (the “Internal Reorganization”) to realign their businesses into three subgroups: agriculture, materials science and specialty products. Dow Inc. was formed as a wholly-owned subsidiary of DowDuPont as the holding company for the materials sciences business, and the Company was formed as a wholly-owned subsidiary of DowDuPont as the holding company for the agriculture business. On April 1, 2019, Dow Inc. became an independent, publicly traded company through the previously announced separation of the materials science business of DowDuPont.

In contemplation of the distributions and to achieve the respective credit profiles of each of the intended future companies, DowDuPont completed a series of financing transactions, which included an offering of senior unsecured notes and the establishment of new term loan facilities. Additionally, in the second quarter of 2019, DowDuPont issued commercial paper. DowDuPont contributed a portion of the net proceeds of the notes offering and commercial paper to Historical DuPont and Corteva to pay off or retire a portion of Historical DuPont’s existing debt liabilities (the “Debt Retirement Transactions”).

For informational purposes only, the Company is furnishing in Exhibit 99.1 to this Current Report on Form 8-K unaudited pro forma combined statements of income (collectively, the “pro forma income statements”), selected unaudited pro forma historical segment information, and selected pro forma historical non-GAAP information for each of the quarterly periods in 2017 and 2018, the three months ended March 31, 2019 and the twelve months ended December 31, 2016, 2017 and 2018. The pro forma financial information, give effect to the Merger, Internal Reorganization, Debt Retirement Transactions and the Corteva Distribution as if they had been consummated on January 1, 2016. The pro forma financial information presented in Exhibit 99.1 do not purport to represent what the results of operations would have been had the Merger, Internal Reorganization, Debt Retirement Transactions and the Corteva Distribution been consummated on the dates indicated, nor do they purport to project the results of operations for any future period or as of any future date.

The information contained in this Form 8-K, including Exhibit 99.1, is being furnished pursuant to Regulation FD in order to provide the financial community with summary financial information and historical data that is on a basis consistent with how the Company will report current financial information. The information contained in this report, including Exhibit 99.1, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section. In addition, the information contained in this report shall not be deemed to be incorporated by reference into any registration statement or other document filed by the Company under the Securities Act of 1933, as amended, or the Exchange Act except as expressly set forth by specific reference in such filing. The information will provide investors with tools that management uses to budget, make operating and strategic decisions and evaluate performance. This financial information should be read in conjunction with Amendment No. 4 to the Registration Statement on Form 10 (File No. 001-38710) filed by Corteva with the Securities and Exchange Commission on May 6, 2019.
    

Item 9.01 Financial Statements and Exhibits.

(d)    Exhibits.
Unaudited Pro Forma Combined Statements of Operations and Pro Forma Historical Segment Information adjusted to reflect the Merger, Internal Reorganization, Debt Retirement Transactions and the Corteva Distribution, by quarter.
* Furnished herewith.






SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
CORTEVA, INC.
 
(Registrant)
 
 
 
 
By:
/s/ Brian Titus
Name:
Brian Titus
Title:
Vice President and Controller
 
August 1, 2019



Document


UNAUDITED PRO FORMA COMBINED STATEMENTS OF INCOME AND PRO FORMA SEGMENT INFORMATION

DowDuPont Inc. (“DowDuPont”) was formed on December 9, 2015, to effect an all-stock merger of equals strategic combination between The Dow Chemical Company (“Historical Dow”) and E. I. du Pont de Nemours and Company (“Historical DuPont”). On August 31, 2017 at 11:59 pm ET, (the “Merger Effectiveness Time”) pursuant to the Agreement and Plan of Merger, dated as of December 11, 2015, as amended on March 31, 2017 (the “Merger Agreement”), Historical Dow and Historical DuPont each merged with wholly owned subsidiaries of DowDuPont (“Mergers”) and, as a result of the Mergers, Historical Dow and Historical DuPont became subsidiaries of DowDuPont (collectively, the “Merger”). Prior to the Merger, DowDuPont did not conduct any business activities other than those required for its formation and matters contemplated by the Merger Agreement.
For purposes of DowDuPont’s financial statement presentation, Historical Dow was determined to be the accounting acquirer in the Merger and Historical DuPont’s assets and liabilities are reflected at fair value as of the Merger Effectiveness Time in the historical financial statements of DowDuPont. In connection with the Merger and the related accounting determination, Historical DuPont elected to apply push down accounting and reflect in its historical financial statements the fair value of its assets and liabilities. For purposes of Historical DuPont’s financial statement presentation, periods following the closing of the Merger are labeled “Successor” and reflect DowDuPont’s basis in the fair values of the assets and liabilities of Historical DuPont. All periods prior to the closing of the Merger reflect the historical accounting basis in Historical DuPont’s assets and liabilities and are labeled “Predecessor.” Historical DuPont’s historical financial statements include a black line division between the columns titled “Predecessor” and “Successor” to signify that the amounts shown for the periods prior to and following the Merger are not comparable.
In connection with the Dow Distribution and the Corteva Distribution (both of which are defined below), DowDuPont formed two wholly-owned subsidiaries: Dow Inc. (“Dow”), to serve as a holding company for its materials science business, and Corteva, Inc. (“Corteva” or “the company”), to serve as a holding company for its agriculture business. As a result of the Internal Reorganization (defined below), Corteva, Inc. owns 100% of the outstanding common stock of Historical DuPont. Stockholders of Historical DuPont’s preferred stock continue to hold such shares following the Corteva Distribution. After the Corteva Distribution, Historical DuPont remains a subsidiary of Corteva, Inc., continues to be a reporting company and complies with the requirements of the Securities Exchange Act of 1934.
Historical DuPont has been determined to best represent the predecessor entity to Corteva. As such, the unaudited pro forma combined statements of income and pro forma segment information (collectively the “pro forma financial information”) are derived from the audited annual and unaudited interim consolidated financial statements of Historical DuPont, and the audited annual and unaudited interim combined financial statements of the Historical Dow’s agriculture business (“Dow AgroSciences”).
On April 1, 2019, DowDuPont completed the separation of its materials science business (the “Dow Distribution”). On June 1, 2019 (the “distribution date”), DowDuPont, completed the previously announced separation of its agriculture business (the “Corteva Distribution”). Effective with the Corteva Distribution, DowDuPont changed its name to DuPont de Nemours, Inc. The separation was completed by way of a pro rata distribution of all of the then-issued and outstanding shares of common stock, par value $0.01 per share, of Corteva, Inc., a Delaware corporation and wholly owned subsidiary of DowDuPont, to holders of record of DowDuPont common stock as of the close of business on May 24, 2019.
Prior to the Dow Distribution, Historical Dow conveyed or transferred the assets and liabilities aligned with Dow AgroSciences to separate legal entities (the “Dow AgroSciences entities”) and the assets and liabilities associated with its specialty products business to separate legal entities (the “Dow Specialty Products entities”). On April 1, 2019, the Dow AgroSciences entities and the Dow Specialty Products entities were transferred and conveyed to DowDuPont.
In furtherance of the distributions, Historical DuPont engaged in a series of internal reorganization and realignment steps (the “Internal Reorganization”) to realign its businesses into three subgroups: agriculture, materials science and specialty products. As part of the Internal Reorganization:
the assets and liabilities aligned with Historical DuPont’s materials science business (including Historical DuPont’s ethylene and ethylene copolymers business, excluding its ethylene acrylic elastomers business, were transferred or conveyed to separate legal entities (the “DuPont Materials Science entities”), that were ultimately conveyed by DowDuPont to Dow;
the assets and liabilities aligned with Historical DuPont’s specialty products business were transferred or conveyed to separate legal entities (the “DuPont Specialty Products entities”);
on April 1, 2019, Historical DuPont distributed the DuPont Materials Science entities to DowDuPont, which DowDuPont then conveyed to Dow;
on May 1, 2019, Historical DuPont distributed the DuPont Specialty Products entities to DowDuPont; and
on May 2, 2019, DowDuPont conveyed the Dow AgroSciences entities to Historical DuPont; in connection with the foregoing, Historical DuPont issued additional shares of its common stock to DowDuPont.
As a result of the foregoing, at May 2, 2019, Historical DuPont held all or substantially all the assets and liabilities associated with DowDuPont’s combined agriculture business. On May 31, 2019 DowDuPont contributed Historical DuPont to Corteva.
The following unaudited pro forma combined statements of income reflect Historical DuPont’s materials science and specialty products divestitures as discontinued operations and the receipt of Dow AgroSciences as a common control combination. The historical financial statements and related notes of the company will be retrospectively adjusted to reflect the discontinued operations for each period presented, as well as to include Dow AgroSciences from the Merger Effectiveness Time onward.
In contemplation of the distributions and to achieve the respective credit profiles of each of the intended future companies, DowDuPont completed a series of financing transactions, which included an offering of senior unsecured notes and the establishment of new term loan facilities (the “financing transactions”). Additionally, in the second quarter of 2019, DowDuPont issued commercial paper. DowDuPont contributed a portion of the net proceeds of the notes offering and commercial paper to Historical DuPont and Corteva to pay off or retire a portion of Historical DuPont’s existing debt liabilities (the “Debt Retirement Transactions”).

1




The following pro forma financial information, gives effect to the Merger, Internal Reorganization, Debt Retirement Transactions and the Corteva Distribution as if they had been consummated on January 1, 2016. The pro forma financial information is presented for informational purposes only, and does not purport to represent what the results of operations would have been had the Merger, Internal Reorganization, Debt Retirement Transactions and the Corteva Distribution been consummated on the dates indicated, nor do they purport to project the results of operations for any future period or as of any future date.
One-time transaction-related costs incurred prior to, or concurrent with, the closing of the Merger, Internal Reorganization, Debt Retirement Transactions and the Corteva Distribution are not included in the unaudited pro forma combined statements of income. The unaudited pro forma combined statements of income do not reflect restructuring or integration activities or other costs following the separation and distribution transactions that may be incurred to achieve cost or growth synergies of Corteva. As no assurance can be made that these costs will be incurred or the growth synergies will be achieved, no adjustment has been made.
Regulation G
This following pro forma financial information includes information that does not conform to U.S. GAAP and are considered non-GAAP measures. These measures include Corteva pro forma Operating EBITDA, Corteva Segment pro forma Operating EBITDA, pro forma operating earnings, and pro forma operating earnings per share. Management believes that these non-GAAP measures best 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. This data should be read in conjunction with Amendment No. 4 to the Registration Statement on Form 10 (File No. 001-38710) filed by Corteva with the Securities and Exchange Commission on May 6, 2019. A reconciliation between these non-GAAP measures to U.S. GAAP is included with the tables to the pro forma financial information. Corteva pro forma Operating EBITDA is defined as pro forma earnings (i.e., pro forma income from continuing operations before income taxes) before interest, depreciation, amortization, non-operating costs, net and foreign exchange gains (losses), excluding the impact of pro forma significant items (including goodwill impairment charges). Non-operating costs, net consists of non-operating pension and other post-employment benefit (OPEB) costs, environmental remediation and legal costs associated with legacy businesses and sites of Historical DuPont. Corteva Segment pro forma Operating EBITDA is defined as Corteva pro forma Operating EBITDA excluding corporate expenses. Pro forma operating earnings and pro forma operating earnings per common share from continuing operations - diluted is defined as pro forma net income from continuing operations attributable to Corteva excluding the after-tax impact of significant items (including goodwill impairment charges), the after-tax impact of non-operating costs, net, and the after-tax impact of amortization expense associated with intangible assets existing as of the separation from DowDuPont. 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.

2




Corteva, Inc.
Summary of Pro Forma Combined Statements of Income (Unaudited)
 
Three Months Ended
Year Ended
Three Months Ended
Year Ended
Three Months Ended
Year Ended
In millions, except per share amounts
Mar 31, 2019
Dec 31, 2018
Dec 31, 2018
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Dec 31, 2017
Dec 31, 2017
Sep 30, 2017
Jun 30, 2017
Mar 31, 2017
Dec 31, 2016
Net sales
$
3,396

$
14,287

$
2,815

$
1,947

$
5,731

$
3,794

$
14,241

$
2,730

$
1,908

$
4,561

$
5,042

$
14,041

Cost of goods sold
2,022

8,449

1,906

1,388

3,024

2,131

8,338

1,812

1,365

2,452

2,709

8,316

Research and development expenses
299

1,352

344

324

353

331

1,439

362

369

364

344

1,440

Selling, general and administrative expenses
738

3,042

694

633

966

749

3,109

690

678

878

863

3,083

Amortization of intangibles as of separation
101

391

107

88

107

89

270

77

60

69

64

247

Restructuring and asset related charges - net
61

694

228

235

101

130

271

216

52


3

453

Integration costs
100

571

187

134

126

124

217

92

61

30

34

74

Goodwill impairment charges

4,503


4,503









Other income (expense) - net
31

249

131

7

128

(17
)
(899
)
33

(156
)
(208
)
(568
)
(73
)
Interest expense
14

76

25

13

21

17

87

23

26

23

15

101

Income (loss) from continuing operations before income taxes
92

(4,542
)
(545
)
(5,364
)
1,161

206

(389
)
(509
)
(859
)
537

442

254

(Benefit from) provision for income taxes on continuing operations
(20
)
395

201

(28
)
193

29

(2,910
)
(2,724
)
121

(86
)
(221
)
(270
)
Income (loss) from continuing operations after income taxes
112

(4,937
)
(746
)
(5,336
)
968

177

2,521

2,215

(980
)
623

663

524

Net income from continuing operations attributable to noncontrolling interests
8

29

6

5

5

13

35

5

3

11

16

25

Net income (loss) from continuing operations available to Corteva common stockholders
$
104

$
(4,966
)
$
(752
)
$
(5,341
)
$
963

$
164

$
2,486

$
2,210

$
(983
)
$
612

$
647

$
499

 
 
 
 
 
 
 
 
 
 
 
 
 
Per common share data:
 
 
 
 
 
 
 
 
 
 
 
 
Earnings (loss) per common share from continuing operations - basic and diluted (1)(2)
$
0.14

$
(6.63
)
$
(1.00
)
$
(7.13
)
$
1.29

$
0.22

$
3.32

$
2.95

$
(1.31
)
$
0.82

$
0.86

$
0.67

 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average common shares outstanding - basic and diluted (1)
749.4

749.4

749.4

749.4

749.4

749.4

749.4

749.4

749.4

749.4

749.4

749.4

(1)
On June 1, 2019, DowDuPont distributed 748,815,000 shares of Corteva, Inc. common stock to holders of its common stock. Earnings (loss) per common share from continuing operations were calculated using the shares distributed on June 1, 2019, plus 582,000 shares of additional shares in which accelerated vesting conditions have been met.
(2)
The sum of the quarterly earnings per share amounts may not equal the year-to-date earnings per share amounts due to rounding.


Refer to subsequent tables for reconciliations of historical consolidated statements of income to the unaudited pro forma statements of income.



3




Corteva, Inc.
Selected Pro Forma Segment Information (Unaudited)
 
Three Months Ended
Year Ended
Three Months Ended
Year Ended
Three Months Ended
Year Ended
In millions
Mar 31, 2019
Dec 31, 2018
Dec 31, 2018
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Dec 31, 2017
Dec 31, 2017
Sep 30, 2017
Jun 30, 2017
Mar 31, 2017
Dec 31, 2016
Pro forma net sales by segment
 
 
 
 
 
 
 
 
 
 
 
 
Seeds
$
1,967

$
7,842

$
1,126

$
551

$
3,864

$
2,301

$
8,056

$
1,100

$
595

$
2,863

$
3,498

$
7,835

Crop Protection
1,429

6,445

1,689

1,396

1,867

1,493

6,185

1,630

1,313

1,698

1,544

6,206

Segment pro forma net sales
$
3,396

$
14,287

$
2,815

$
1,947

$
5,731

$
3,794

$
14,241

$
2,730

$
1,908

$
4,561

$
5,042

$
14,041

Segment pro forma Operating EBITDA
 
 
 
 
 
 
 
 
 
 
 
 
Seeds
$
325

$
1,139

$
(87
)
$
(372
)
$
1,158

$
440

$
1,170

$
(126
)
$
(441
)
$
695

$
1,042

$
997

Crop Protection
220

1,074

169

159

423

323

936

197

110

353

276

919

Segment pro forma Operating EBITDA (Non-GAAP)(1)
$
545

$
2,213

$
82

$
(213
)
$
1,581

$
763

$
2,106

$
71

$
(331
)
$
1,048

$
1,318

$
1,916

Corporate expenses
(27
)
(141
)
(32
)
(38
)
(37
)
(34
)
(151
)
(39
)
(44
)
(34
)
(34
)
(186
)
Corteva pro forma Operating EBITDA (Non-GAAP)(1)
$
518

$
2,072

$
50

$
(251
)
$
1,544

$
729

$
1,955

$
32

$
(375
)
$
1,014

$
1,284

$
1,730

(1)
Refer to page 5 for reconciliation to the most comparable GAAP metric.



4




Corteva, Inc.
Reconciliation of Pro Forma Income (Loss) from Continuing Operations After Income Taxes to Corteva Pro Forma Operating EBITDA (Unaudited)
 
Three Months Ended
Year Ended
Three Months Ended
Year Ended
Three Months Ended
Year Ended
In millions
Mar 31, 2019
Dec 31, 2018
Dec 31, 2018
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Dec 31, 2017
Dec 31, 2017
Sep 30, 2017
Jun 30, 2017
Mar 31, 2017
Dec 31, 2016
Pro forma income (loss) from continuing operations after income taxes (GAAP)
$
112

$
(4,937
)
$
(746
)
$
(5,336
)
$
968

$
177

$
2,521

$
2,215

$
(980
)
$
623

$
663

$
524

(Benefit from) provision for income taxes on continuing operations
(20
)
395

201

(28
)
193

29

(2,910
)
(2,724
)
121

(86
)
(221
)
(270
)
Pro forma income (loss) from continuing operations before income taxes (GAAP)
92

(4,542
)
(545
)
(5,364
)
1,161

206

(389
)
(509
)
(859
)
537

442

254

+ Depreciation and amortization
258

909

242

215

237

215

771

203

188

193

187

709

- Interest income
(16
)
(86
)
(23
)
(12
)
(24
)
(27
)
(109
)
(21
)
(33
)
(29
)
(26
)
(109
)
+ Interest expense
14

76

25

13

21

17

87

23

26

23

15

101

-/+ Exchange (gains) losses - net
27

77

(63
)
74

1

65

373

92

119

139

23

207

-/+ Non-operating (benefits) costs - net(1)
(42
)
(211
)
(56
)
(49
)
(55
)
(51
)
265

(64
)
71

121

137

92

+ Goodwill impairment charge

4,503


4,503









+ Significant items(2)
185

1,346

470

369

203

304

957

308

113

30

506

476

Corteva pro forma Operating EBITDA (Non-GAAP)
$
518

$
2,072

$
50

$
(251
)
$
1,544

$
729

$
1,955

$
32

$
(375
)
$
1,014

$
1,284

$
1,730

- Corporate expenses
$
(27
)
$
(141
)
$
(32
)
$
(38
)
$
(37
)
$
(34
)
$
(151
)
$
(39
)
$
(44
)
$
(34
)
$
(34
)
$
(186
)
Segment pro forma Operating EBITDA (Non-GAAP)
$
545

$
2,213

$
82

$
(213
)
$
1,581

$
763

$
2,106

$
71

$
(331
)
$
1,048

$
1,318

$
1,916

(1)
Non-operating (benefits) costs, net consists of non-operating pension and other post-employment benefit (OPEB) costs, environmental remediation and legal costs associated with legacy businesses and sites of Historical DuPont.
(2)
Refer to Pro Forma Significant Items on page 6 for further details.

5




Corteva, Inc.
Pro Forma Significant Items (Unaudited)
 
Three Months Ended
Year Ended
Three Months Ended
Year Ended
Three Months Ended
Year Ended
In millions
Mar 31, 2019
Dec 31, 2018
Dec 31, 2018
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Dec 31, 2017
Dec 31, 2017
Sep 30, 2017
Jun 30, 2017
Mar 31, 2017
Dec 31, 2016
Gain on sale of assets(1)
$

$
24

$

$

$
24

$

$

$

$

$

$

$

Loss on deconsolidation of subsidiary(1)

(53
)
(53
)









Bayer CropScience arbitration(1) 






(469
)



(469
)

Integration costs
(100
)
(571
)
(187
)
(134
)
(126
)
(124
)
(217
)
(92
)
(61
)
(30
)
(34
)
(74
)
Restructuring and asset-related charges - net
(61
)
(694
)
(228
)
(235
)
(101
)
(130
)
(271
)
(216
)
(52
)

(3
)
(453
)
Loss on divestiture(1)
(24
)
(2
)
(2
)









Customer claim adjustment/recovery(2)











53

Income tax related item(3)

(50
)



(50
)






Environmental charges(4)











(2
)
Total pretax pro forma significant items(5)
(185
)
(1,346
)
(470
)
(369
)
(203
)
(304
)
(957
)
(308
)
(113
)
(30
)
(506
)
(476
)
+ Total tax impact of significant items(6)
30

278

93

68

44

73

290

77

18

9

186

184

+ Tax only significant items benefit (charge)
62

(386
)
(260
)
(55
)
(7
)
(64
)
2,332

2,259

35

(54
)
92

(5
)
Total pro forma significant items benefit (charge), net of tax(7) 
$
(93
)
$
(1,454
)
$
(637
)
$
(356
)
$
(166
)
$
(295
)
$
1,665

$
2,028

$
(60
)
$
(75
)
$
(228
)
$
(297
)
(1)
Included in Other income (expense) - net.
(2)
Included in Selling, general and administrative expenses.
(3)
Includes a foreign exchange loss related to adjustments to Historical DuPont’s foreign currency exchange contracts as a result of U.S. tax reform, included in other income (expense) - net.
(4)
Included in Cost of goods sold.
(5)
Impact on Pro forma income (loss) from continuing operations before income taxes.
(6)
The income tax effect for each significant item was calculated based on the statutory tax rate for the jurisdiction(s) in which the significant item was taxable or deductible.
(7)
Impact on Pro forma income (loss) from continuing operations after income taxes.





6




Corteva, Inc.
Non-GAAP Reconciliations

Reconciliation of pro forma net income (loss) from continuing operations available to Corteva common stockholders to pro forma operating earnings:
 
Three Months Ended
Year Ended
Three Months Ended
Year Ended
Three Months Ended
Year Ended
In millions
Mar 31, 2019
Dec 31, 2018
Dec 31, 2018
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Dec 31, 2017
Dec 31, 2017
Sep 30, 2017
Jun 30, 2017
Mar 31, 2017
Dec 31, 2016
Pro forma net income (loss) from continuing operations available to Corteva common stockholders (GAAP)
$
104

$
(4,966
)
$
(752
)
$
(5,341
)
$
963

$
164

$
2,486

$
2,210

$
(983
)
$
612

$
647

$
499

Less: Significant items benefit (charge), net of tax(1)(2)
(93
)
(1,454
)
(637
)
(356
)
(166
)
(295
)
1,665

2,028

(60
)
(75
)
(228
)
(297
)
Less: Goodwill impairment charge, net of tax(1)

(4,503
)

(4,503
)








Less: Amortization of intangibles (existing as of separation), net of tax(1)
(81
)
(313
)
(86
)
(71
)
(86
)
(70
)
(186
)
(55
)
(41
)
(47
)
(43
)
(169
)
Less: Non-operating benefit (cost) - net, net of tax(1)
31

165

44

38

43

40

(170
)
41

(45
)
(78
)
(88
)
(59
)
Pro forma operating earnings (Non-GAAP)
$
247

$
1,139

$
(73
)
$
(449
)
$
1,172

$
489

$
1,177

$
196

$
(837
)
$
812

$
1,006

$
1,024

(1)
Impact on pro form net income (loss) from continuing operations available to Corteva common stock holders. The income tax effect for each adjustment was calculated based on the statutory tax rate for the jurisdiction(s) in which the adjustment was taxable or deductible.
(2)
Refer to Pro Forma Significant Items on page 6 for further details.
Reconciliation of pro forma earnings per common share - diluted to pro forma operating earnings per common share:
 
Three Months Ended
Year Ended
Three Months Ended
Year Ended
Three Months Ended
Year Ended
Earnings per common share (“EPS”)
Mar 31, 2019
Dec 31, 2018(2)
Dec 31, 2018
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Dec 31, 2017(2)
Dec 31, 2017
Sep 30, 2017
Jun 30, 2017
Mar 31, 2017
Dec 31, 2016
Pro forma earnings per share - diluted (GAAP)
$
0.14

$
(6.63
)
$
(1.00
)
$
(7.13
)
$
1.29

$
0.22

$
3.32

$
2.95

$
(1.31
)
$
0.82

$
0.86

$
0.67

Less: Significant items benefit (charge), net of tax(1)
(0.12
)
(1.94
)
(0.85
)
(0.48
)
(0.22
)
(0.39
)
2.22

2.71

(0.08
)
(0.10
)
(0.30
)
(0.40
)
Less: Goodwill impairment charge, net of tax(1)

(6.01
)

(6.01
)








Less: Amortization of intangibles (existing as of separation), net of tax(1)
(0.11
)
(0.42
)
(0.11
)
(0.09
)
(0.11
)
(0.09
)
(0.25
)
(0.07
)
(0.05
)
(0.06
)
(0.06
)
(0.23
)
Less: Non-operating benefit (cost) - net, net of tax(1)
0.04

0.22

0.06

0.05

0.06

0.05

(0.23
)
0.05

(0.06
)
(0.10
)
(0.12
)
(0.08
)
Pro forma operating earnings per common share (Non-GAAP)
$
0.33

$
1.52

$
(0.10
)
$
(0.60
)
$
1.56

$
0.65

$
1.58

$
0.26

$
(1.12
)
$
1.08

$
1.34

$
1.38

(1)
Impact on pro form earnings per common share - diluted. The income tax effect for each adjustment was calculated based on the statutory tax rate for the jurisdiction(s) in which the adjustment was taxable or deductible.
(2)
The sum of the quarterly earnings per share amounts may not equal the year-to-date earnings per share amounts due to rounding.




7




Corteva, Inc.
Unaudited Pro Forma Combined Statement of Income
For the Three Months Ended March 31, 2019
 
Successor Historical DuPont
Dow AgroSciences
Discontinued Operations
Historical Adjustments(1)
 
Pro Forma Adjustments(2)
 
Corteva Pro Forma
In millions, except per share amounts
As Reported
As Reported
 
 
 
 
 
 
Net sales
$
6,288

$
1,449

$
(4,178
)
$
(163
)
 
$

 
$
3,396

Cost of goods sold
4,235

939

(2,794
)
(169
)
 
(189
)
 
2,022

Research and development expense
355

102

(157
)
(1
)
 

 
299

Selling, general and administrative expenses
970

171

(410
)
4

 
3

 
738

Amortization of intangibles as of separation
320

5

(224
)

 

 
101

Restructuring and asset related charges - net
55

49

(45
)
2

 

 
61

Integration and separation costs
405


(208
)
15

 
(112
)
 
100

Other income (expense) - net
157

(4
)
(122
)

 

 
31

Interest expense
56

3



 
(45
)
 
14

Income (loss) from continuing operations before income taxes
49

176

(462
)
(14
)
 
343

 
92

(Benefit from) provision for income taxes on continuing operations
(40
)
80

(104
)
(3
)
 
47

 
(20
)
Income (loss) from continuing operations after income taxes
89

96

(358
)
(11
)
 
296

 
112

Net income from continuing operations attributable to noncontrolling interests
4

6

(4
)
2

 

 
8

Net income (loss) from continuing operations attributable to Corteva
85

90

(354
)
(13
)
 
296

 
104

Preferred stock dividends
2



(2
)
 

 

Net income (loss) from continuing operations available to Corteva common stockholders
$
83

$
90

$
(354
)
$
(11
)
 
$
296

 
$
104

 
 
 
 
 
 
 
 
 
Per common share data:
 
 
 
 
 
 
 
 
Earnings per common share from continuing operations - basic and diluted(3)
 
 
 
 
 
 
 
$
0.14

 
 
 
 
 
 
 
 
 
Weighted-average common shares outstanding - basic and diluted(3)
 
 
 
 
 
 
 
749.4

(1)
Refer to Historical Adjustments on page 20 for additional details.
(2)
Refer to Pro Forma Adjustments on pages 22 through 24 for additional details.
(3)
On June 1, 2019, DowDuPont distributed 748,815,000 shares of Corteva, Inc. common stock to holders of its common stock. Earnings (loss) per common share from continuing operations were calculated using the shares distributed on June 1, 2019, plus 582,000 shares of additional shares in which accelerated vesting conditions have been met.

8




Corteva, Inc.
Unaudited Pro Forma Combined Statement of Income
For the Year Ended December 31, 2018
 
Successor Historical DuPont
Dow AgroSciences
Discontinued Operations
Historical Adjustments(1)
 
Pro Forma Adjustments(2)
 
Corteva Pro Forma
In millions, except per share amounts
As Reported
As Reported
 
 
 
 
 
 
Net sales
$
26,279

$
5,646

$
(17,275
)
$
(363
)
 
$

 
$
14,287

Cost of goods sold
18,182

3,893

(11,615
)
(512
)
 
(1,499
)
 
8,449

Research and development expense
1,524

492

(649
)
(12
)
 
(3
)
 
1,352

Selling, general and administrative expenses
3,853

770

(1,642
)
60

 
1

 
3,042

Amortization of intangibles as of separation
1,281

22

(912
)

 

 
391

Restructuring and asset related charges - net
485

308

(109
)
10

 

 
694

Integration and separation costs
1,375


(475
)
92

 
(421
)
 
571

Goodwill impairment charges
4,503




 

 
4,503

Other income (expense) - net
543

(40
)
(254
)

 

 
249

Loss on early extinguishment of debt
81




 
(81
)
 

Interest expense
331

6



 
(261
)
 
76

(Loss) income from continuing operations before income taxes
(4,793
)
115

(2,127
)
(1
)
 
2,264

 
(4,542
)
Provision for (benefit from) income taxes on continuing operations
220

124

(376
)
1

 
426

 
395

(Loss) income from continuing operations after income taxes
(5,013
)
(9
)
(1,751
)
(2
)
 
1,838

 
(4,937
)
Net income from continuing operations attributable to noncontrolling interests
11

17

(9
)
10

 

 
29

Net (loss) income from continuing operations attributable to Corteva
(5,024
)
(26
)
(1,742
)
(12
)
 
1,838

 
(4,966
)
Preferred stock dividends
10



(10
)
 

 

Net (loss) income from continuing operations available to Corteva common stockholders
$
(5,034
)
$
(26
)
$
(1,742
)
$
(2
)
 
$
1,838

 
$
(4,966
)
 
 
 
 
 
 
 
 
 
Per common share data:
 
 
 
 
 
 
 
 
Loss per common share from continuing operations - basic and diluted(3)
 
 
 
 
 
 
 
$
(6.63
)
 
 
 
 
 
 
 
 
 
Weighted-average common shares outstanding - basic and diluted(3)
 
 
 
 
 
 
 
749.4

(1)
Refer to Historical Adjustments on page 20 for additional details.
(2)
Refer to Pro Forma Adjustments on pages 22 through 24 for additional details.
(3)
On June 1, 2019, DowDuPont distributed 748,815,000 shares of Corteva, Inc. common stock to holders of its common stock. Earnings (loss) per common share from continuing operations were calculated using the shares distributed on June 1, 2019, plus 582,000 shares of additional shares in which accelerated vesting conditions have been met.


9




Corteva, Inc.
Unaudited Pro Forma Combined Statement of Income
For the Three Months Ended December 31, 2018
 
Successor Historical DuPont
Dow AgroSciences
Discontinued Operations
Historical Adjustments(1)
 
Pro Forma Adjustments(2)
 
Corteva Pro Forma
In millions, except per share amounts
 
 
 
 
 
 
 
 
Net sales
$
5,741

$
1,424

$
(4,139
)
$
(211
)
 
$

 
$
2,815

Cost of goods sold
3,980

1,070

(2,803
)
(223
)
 
(118
)
 
1,906

Research and development expense
379

133

(163
)
(4
)
 
(1
)
 
344

Selling, general and administrative expenses
889

197

(409
)
17

 

 
694

Amortization of intangibles as of separation
326

5

(224
)

 

 
107

Restructuring and asset related charges - net
115

122

(10
)
1

 

 
228

Integration and separation costs
449


(184
)
30

 
(108
)
 
187

Other income (expense) - net
250

(37
)
(82
)

 

 
131

Loss on early extinguishment of debt
81




 
(81
)
 

Interest expense
83

3



 
(61
)
 
25

(Loss) income from continuing operations before income taxes
(311
)
(143
)
(428
)
(32
)
 
369

 
(545
)
Provision for income taxes on continuing operations
40

3

120

(7
)
 
45

 
201

(Loss) income from continuing operations after income taxes
(351
)
(146
)
(548
)
(25
)
 
324

 
(746
)
Net income from continuing operations attributable to noncontrolling interests
3

3

(3
)
3

 

 
6

Net (loss) income from continuing operations attributable to Corteva
(354
)
(149
)
(545
)
(28
)
 
324

 
(752
)
Preferred stock dividends
3



(3
)
 

 

Net (loss) income from continuing operations available to Corteva common stockholders
$
(357
)
$
(149
)
$
(545
)
$
(25
)
 
$
324

 
$
(752
)
 
 
 
 
 
 
 
 
 
Per common share data:
 
 
 
 
 
 
 
 
Loss per common share from continuing operations - basic and diluted(3)
 
 
 
 
 
 
 
$
(1.00
)
 
 
 
 
 
 
 
 
 
Weighted-average common shares outstanding - basic and diluted(3)
 
 
 
 
 
 
 
749.4

(1)
Refer to Historical Adjustments on page 20 for additional details.
(2)
Refer to Pro Forma Adjustments on pages 22 through 24 for additional details.
(3)
On June 1, 2019, DowDuPont distributed 748,815,000 shares of Corteva, Inc. common stock to holders of its common stock. Earnings (loss) per common share from continuing operations were calculated using the shares distributed on June 1, 2019, plus 582,000 shares of additional shares in which accelerated vesting conditions have been met.




10




Corteva, Inc.
Unaudited Pro Forma Combined Statement of Income
For the Three Months Ended September 30, 2018
 
Successor Historical DuPont
Dow AgroSciences
Discontinued Operations
Historical Adjustments(1)
 
Pro Forma Adjustments(2)
 
Corteva Pro Forma
In millions, except per share amounts
As Reported
 
 
 
 
 
 
 
Net sales
$
5,294

$
1,031

$
(4,298
)
$
(80
)
 
$

 
$
1,947

Cost of goods sold
3,686

801

(2,876
)
(126
)
 
(97
)
 
1,388

Research and development expense
367

120

(156
)
(6
)
 
(1
)
 
324

Selling, general and administrative expenses
823

191

(391
)
10

 

 
633

Amortization of intangibles as of separation
307

6

(225
)

 

 
88

Restructuring and asset related charges - net
182

63

(13
)
3

 

 
235

Integration and separation costs
344


(115
)
24

 
(119
)
 
134

Goodwill impairment charges
4,503




 

 
4,503

Other income (expense) - net
52

(17
)
(28
)

 

 
7

Interest expense
82




 
(69
)
 
13

(Loss) income from continuing operations before income taxes
(4,948
)
(167
)
(550
)
15

 
286

 
(5,364
)
Provision for (benefit from) income taxes on continuing operations
12


(24
)
4

 
(20
)
 
(28
)
(Loss) income from continuing operations after income taxes
(4,960
)
(167
)
(526
)
11

 
306

 
(5,336
)
Net income from continuing operations attributable to noncontrolling interests

3


2

 

 
5

Net (loss) income from continuing operations attributable to Corteva
(4,960
)
(170
)
(526
)
9

 
306

 
(5,341
)
Preferred stock dividends
2



(2
)
 

 

Net (loss) income from continuing operations available to Corteva common stockholders
$
(4,962
)
$
(170
)
$
(526
)
$
11

 
$
306

 
$
(5,341
)
 
 
 
 
 
 
 
 
 
Per common share data:
 
 
 
 
 
 
 
 
Loss per common share from continuing operations - basic and diluted(3)
 
 
 
 
 
 
 
$
(7.13
)
 
 
 
 
 
 
 
 
 
Weighted-average common shares outstanding - basic and diluted(3)
 
 
 
 
 
 
 
749.4

(1)
Refer to Historical Adjustments on page 20 for additional details.
(2)
Refer to Pro Forma Adjustments on pages 22 through 24 for additional details.
(3)
On June 1, 2019, DowDuPont distributed 748,815,000 shares of Corteva, Inc. common stock to holders of its common stock. Earnings (loss) per common share from continuing operations were calculated using the shares distributed on June 1, 2019, plus 582,000 shares of additional shares in which accelerated vesting conditions have been met.


11




Corteva, Inc.
Unaudited Pro Forma Combined Statement of Income
For the Three Months Ended June 30, 2018
 
Successor Historical DuPont
Dow AgroSciences
Discontinued Operations
Historical Adjustments(1)
 
Pro Forma Adjustments(2)
 
Corteva Pro Forma
In millions, except per share amounts
As Reported
 
 
 
 
 
 
 
Net sales
$
8,545

$
1,708

$
(4,484
)
$
(38
)
 
$

 
$
5,731

Cost of goods sold
5,669

1,114

(3,003
)
(93
)
 
(663
)
 
3,024

Research and development expense
396

123

(166
)
1

 
(1
)
 
353

Selling, general and administrative expenses
1,182

181

(416
)
18

 
1

 
966

Amortization of intangibles as of separation
333

5

(231
)

 

 
107

Restructuring and asset related charges - net
91

52

(42
)

 

 
101

Integration and separation costs
327


(98
)
20

 
(123
)
 
126

Other income (expense) - net
194

9

(75
)

 

 
128

Interest expense
86

2



 
(67
)
 
21

Income (loss) from continuing operations before income taxes
655

240

(603
)
16

 
853

 
1,161

Provision for (benefit from) income taxes on continuing operations
141

69

(280
)
3

 
260

 
193

Income (loss) from continuing operations after income taxes
514

171

(323
)
13

 
593

 
968

Net income from continuing operations attributable to noncontrolling interests
1


1

3

 

 
5

Net income from continuing operations attributable to Corteva
513

171

(324
)
10

 
593

 
963

Preferred stock dividends
3



(3
)