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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 2.02     Results of Operations and Financial Condition
On August 1, 2019, the Corteva, Inc. (the "Company") announced its consolidated financial results for the quarter ended June 30, 2019. A copy of the Company’s press release and related presentation are furnished herewith on Form 8-K as Exhibits 99.1 and 99.2, respectively. The information contained in this report, including Exhibits 99.1 and 99.2, 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.

Item 9.01     Financial Statements and Exhibits

(d)
Exhibits.
Press Release dated August 1, 2019
Corteva Second Quarter 2019 Earnings Presentation dated August 1, 2019







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)
 
 
 
 
 
/s/ Brian Titus
 
Brian Titus
 
Vice President and Controller
 
August 1, 2019


Exhibit
 
 
 
 
 
Exhibit 99.1
https://cdn.kscope.io/d53c8bb1b5e68ee6ff09207451690a91-corteva.jpg
 

Corteva Agriscience Reports Second Quarter 2019 Operating Results -
Capitalizes on Strong Performance Outside North America
Company Updates Full Year Outlook

•
GAAP earnings per share (EPS) from continuing operations was $0.63, with operating EPS1 of $1.42.
•
The Company delivered net sales of $5.6 billion, down 3 percent versus the same quarter last year, primarily due to unprecedented weather impacts in North America2.
•
Outside North America, favorable conditions supported strong organic sales1 growth in both Crop Protection and Seed, up 21 percent and 10 percent for the quarter, respectively.
•
GAAP net income from continuing operations totaled $0.5 billion, down 50 percent versus the same quarter last year on a pro forma basis3. Operating EBITDA1 was $1.5 billion, down 6 percent versus the same quarter last year on a pro forma basis, with operating EBITDA improvement in Crop Protection from new products and cost savings from synergies offset by currency headwinds and lower Seed results due primarily to declines in the North American market.
•
The Company realized cost synergies of approximately $200 million for the six months ended June 30, 2019, bringing the cumulative realized savings since merger close to $700 million out of the total $1.2 billion that are expected by 2021.
•
During the first half 2019, the Company announced new regulatory approvals in Seed, together with new and expanded registrations across the Crop Protection portfolio, including the expanded federal label from the U.S. Environmental Protection Agency for Transform® WG insecticide with Isoclast™ active.
•
Full-year pro forma operating EBITDA1 is now expected to be in the range of $1.9 billion and $2.05 billion, guidance updated as a result of the impact from unprecedented weather events driving reduced crop planting and loss of early season crop protection applications in North America. Net sales for the full year are expected to be down 3 percent.

WILMINGTON, Del., August 1, 2019 - Corteva, Inc. (NYSE: CTVA) today reported financial results for the quarter ended June 30, 2019 and provided updated guidance for the full year.

Commenting on the Company’s second quarter 2019 performance, Chief Executive Officer Jim Collins said, “On June 1, 2019, we completed an important separation milestone, becoming a global, standalone, pure-play agriculture company - taking this step during an extraordinary period in our industry. In our initial quarter as a standalone company, we delivered technology-driven, organic growth in nearly all regions despite continued pressure from the unprecedented weather events that challenged near-term market conditions in North America.”

Collins continued, “We remain committed to executing on our priorities and adjusting our actions focused on delivering continuous value for our customers and shareholders. We are delivering on our cost synergy targets, with an additional $200 million realized in the first half, and we continue to demonstrate our commitment to customer-centered innovation through the acceleration of new product launches that are helping to address real-time challenges facing growers around the world.”

(1) Organic sales, Operating EPS, Pro Forma Operating EPS, Operating EBITDA, Pro Forma Operating EBITDA, Segment Operating EBITDA and Pro Forma Segment Operating EBITDA are non-GAAP measures. See page 7 for further discussion.
(2) North America is defined as U.S. and Canada. Rest of World is defined as EMEA, Latin America and Asia Pacific. EMEA is defined as Europe, Middle East and Africa.
(3) First quarter 2019 and prior year GAAP information is on a pro forma basis and was determined in accordance with Article 11 of Regulation S-X. Non-GAAP measures for these periods are reconciled to the GAAP pro forma measure. See page 7 for further discussion.
(4) Enlist E3™ soybeans are jointly developed by Dow AgroSciences and MS Technologies™

Summary of Second Quarter 2019

Weather-related planting delays and lower than expected planted area in corn, soybeans, and canola pressured sales in North America, and together with an unfavorable currency impact, drove a decrease in net sales of 3 percent in the second quarter 2019 versus the same period last year. Organic sales1 growth in Latin America was driven by strong early demand for Crop Protection products, while EMEA2 and Asia Pacific organic growth was primarily driven by strong demand for new products, including IsoclastTM insecticide, ZorvecTM fungicide and ArylexTM herbicide.

Local price declined 1 percent in the second quarter 2019 versus the year-ago period, with price gains in Rest of World2 more than offset by decreases in North America due to higher replant in corn and competitive pricing pressure on soybeans. Volumes were essentially flat versus the prior-year period due to 5 percent lower volumes in North America on weather-related impacts, offset by performance across the Rest of the World2 on volume growth of 14 percent led by Latin America on pre-season early demand. Currency represented a headwind of 2 percent compared with the same quarter last year, with impacts driven predominately by the Euro.

GAAP net income from continuing operations totaled $0.5 billion in the second quarter 2019, down 50 percent versus the same quarter last year on a pro forma basis. Operating EBITDA1 for the second quarter 2019 was $1.5 billion, a decrease of 6 percent as compared to the same period last year on a pro forma basis. Improvement in Crop Protection segment operating EBITDA from new products and cost savings from synergies were more than offset by currency impacts, lower Seed results due to competitive pricing pressure in soybeans, higher replant in corn and lower Seed margins.

Summary of First Half 2019

Net sales for the first half 2019 were $9 billion, down 6 percent as compared to the prior-year period. Volumes were down 3 percent, with gains in Latin America, EMEA and Asia Pacific more than offset by the declines in North America. Price was flat for the period, with price improvements primarily due to strong demand for new products offset by North America. Currency was a headwind of 3 percent compared with the prior-year period.

Pro forma net income from continuing operations totaled $0.6 billion for the first half 2019, down 48 percent versus the same period last year. Pro forma operating EBITDA1 for the first half 2019 was $2 billion, down 13 percent as compared to the prior-year period. Declines in Crop Protection and Seed were primarily due to lower sales from the impact of weather delays and reduced planted area in North America, competitive pricing pressure, lower margins and currency offsetting cost savings from synergies.

The Company reported GAAP EPS from continuing operations of $0.63, with operating EPS1 of $1.42 for the second quarter 2019. Pro forma GAAP EPS for the first half 2019 was $0.77 with pro forma operating EPS1 of $1.75.

($ in millions)
2Q
2019
2Q
2018
% Change
% Organic Change(1)
 
1H
2019
1H
2018
% Change
% Organic Change(1)
Net Sales
$
5,556

$
5,731

(3
)%
(1
)%
 
$
8,952

$
9,525

(6
)%
(3
)%
North America
3,785

4,126

(8
)%
(8
)%
 
5,177

5,897

(12
)%
(12
)%
Rest of World
1,771

1,605

10
 %
17
 %
 
3,775

3,628

4
 %
12
 %
EMEA
667

687

(3
)%
6
 %
 
2,031

2,083

(2
)%
7
 %
Latin America
653

487

34
 %
39
 %
 
1,018

859

19
 %
25
 %
Asia Pacific
451

431

5
 %
10
 %
 
726

686

6
 %
12
 %

2

($ in millions, except where noted)
2Q
2019
2Q
2018 (3)
% Change
 
1H
2019 (3)
1H
2018 (3)
% Change
GAAP Net income from Continuing Operations
$
483

$
968

(50
)%
 
$
595

$
1,145

(48
)%
Operating EBITDA (1)
1,452

1,544

(6
)%
 
1,970

2,273

(13
)%
GAAP EPS from Continuing Operations ($/share)
$
0.63

$
1.29

(51
)%
 
$
0.77

$
1.50

(49
)%
Operating EPS (1) ($/share)
$
1.42

$
1.56

(9
)%
 
$
1.75

$
2.22

(21
)%

Outlook

Corteva revised its full year guidance of pro forma operating EBITDA2 to a range of $1.9 billion to $2.05 billion. Net sales for the full year are expected to be down about 3 percent.

Commenting on the Company’s outlook, Collins said, “Despite the first-half challenges, we continue to see strength across our global business. Looking ahead to the second-half, we expect ongoing, solid adoption for high-demand products and anticipate continued ramp-up of recent product launches to continue driving high-value sales globally. We remain focused on delivering cost-synergy commitments and expect to see ongoing improvements from productivity actions in the second half. Overall, we remain firm in executing against our plans, capitalizing on the strength of our industry-leading product portfolio and business model in the face of a historic external environment.”

Company Updates

•
Share Repurchase Program and Quarterly Dividend: On June 26, 2019, Corteva announced the authorization of a $1 billion share repurchase program and its first common stock dividend. The share repurchase program is expected to be completed in three years. The inaugural quarterly common stock dividend is expected to return ~$400 million to shareholders annually. Collectively, these announcements reinforce the Company's ongoing commitment to return value to shareholders.

•
Enlist E3TM(4) Licensing Update: In the second quarter 2019, Corteva sold more than 150,000 units of Enlist E3TM soybeans in North America and began recognizing licensing income related to the proprietary trait technology for over 100 executed licenses to date. Enlist E3TM soybeans are estimated to be on greater than 10 percent of North American planted soybean acres in 2020.

•
Label Expansion for Transform® WG insecticide: On July 12, Corteva Agriscience announced the fully restored and expanded federal label from the U.S. Environmental Protection Agency for Transform® WG insecticide with Isoclast™ active. Eight new crops, including corn and alfalfa, are on the expanded label, which also restores the previously labeled use for soybeans and cotton - and provides farmers with a distinct mode of action in the management of destructive insects. In the second quarter 2019, Isoclast™ insecticide sales were approximately $40 million, a more than 70 percent increase from prior year.

3

Crop Protection Results
Net Sales
($ in millions)
2Q
2019
2Q
2018
% Change
% Organic Change (1)
 
1H
2019
1H
2018
% Change
% Organic Change (1)
North America
$
686

$
847

(19
)%
(18
)%
 
$
1,165

$
1,419

(18
)%
(17
)%
Rest of World
1,171

1,020

15
 %
21
 %
 
2,121

1,941

9
 %
17
 %
EMEA
393

420

(6
)%
1
 %
 
953

994

(4
)%
5
 %
Latin America
466

316

47
 %
52
 %
 
653

481

36
 %
43
 %
Asia Pacific
312

284

10
 %
15
 %
 
515

466

11
 %
16
 %
Total Crop Protection Net Sales
$
1,857

$
1,867

(1
)%
3
 %
 
$
3,286

$
3,360

(2
)%
3
 %

Crop Protection net sales were $1.9 billion in the second quarter 2019, down 1 percent from the second quarter 2018. A 3 percent increase in volume was more than offset by a 4 percent decline in currency. Rest of World organic growth was 21 percent compared to the prior-year period.

Volume growth in the segment was primarily driven by strong early demand for spinosyns insecticides and seed applied technologies in Latin America, and sales from new products, including ZorvecTM fungicide, IsoclastTM insecticide and ArylexTM herbicide, which increased 73 percent from prior year. This growth was partially offset by the impacts of wet weather in North America, which negatively impacted corn and soybean herbicide and nitrogen stabilizer applications. Unfavorable currency impacts were driven predominately by the Euro.

Crop Protection operating EBITDA was $0.5 billion in the second quarter 2019, up 6 percent from the second quarter 2018 on a pro forma basis. Cost synergies, ongoing cost reductions and sales from new products more than offset the unfavorable impact of currency.

Crop Protection net sales were $3.3 billion for the first six months of 2019, down 2 percent from the prior-year period. The decrease was primarily due to a 5 percent decline from currency, partially offset by a 2 percent increase in local price and a 1 percent increase in volume. Rest of World organic growth was 17 percent compared to the prior-year period.

Unfavorable currency impacts primarily due to the Euro were partially offset by increases in local price. The increase in volume was driven by sales from new product launches, including ZorvecTM fungicide and IsoclastTM insecticide, which increased 56 percent for the first half, and strong early demand for spinosyns insecticides in Latin America, partially offset by the impacts of wet weather in North America.

Crop Protection pro forma operating EBITDA was $0.7 billion for the first six months of 2019, down 10 percent from the first six months of 2018. The unfavorable impact of currency, volume declines in North America and higher input costs more than offset cost synergies and ongoing cost reductions.

Seed Results
Net Sales
($ in millions)
2Q
2019
2Q
2018
% Change
% Organic Change (1)
 
1H
2019
1H
2018
% Change
% Organic Change (1)
North America
$
3,099

$
3,279

(5
)%
(5
)%
 
$
4,012

$
4,478

(10
)%
(10
)%
Rest of World
600

585

3
 %
10
 %
 
1,654

1,687

(2
)%
7
 %
EMEA
274

267

3
 %
13
 %
 
1,078

1,089

(1
)%
9
 %
Latin America
187

171

9
 %
13
 %
 
365

378

(3
)%
2
 %
Asia Pacific
139

147

(5
)%
—
 %
 
211

220

(4
)%
3
 %
Total Seed Net Sales
$
3,699

$
3,864

(4
)%
(3
)%
 
$
5,666

$
6,165

(8
)%
(5
)%


4

Seed net sales were $3.7 billion in the second quarter 2019, down 4 percent from the second quarter 2018. The decrease was primarily due to a 2 percent decline in local price, a 1 percent decline in currency, and a 1 percent decline in volume. Rest of World organic growth was 10 percent compared to the prior-year period.

The decrease in local price was driven by competitive pressure in soybeans in North America, as well as an increase in corn seed replant in the U.S. Unfavorable currency impacts were due primarily to the Euro. The decline in volume was driven by significant weather-related planting delays and flooding in North America, leading to a reduction in expected planted acres for corn, soybeans, and canola. Volume declines were partially offset by corn sales recovered from the first quarter weather-related delays and a change in the route-to-market in several markets, coupled with increased demand in EMEA for corn and sunflower seed, as well as strong early demand for corn seed in Latin America.

Seed pro forma operating EBITDA was $1.0 billion in the second quarter 2019, a decline of 11 percent compared to the second quarter 2018 on a pro forma basis. Competitive pricing pressure and lower margins more than offset cost synergies in R&D and ongoing cost reductions.

Seed net sales were $5.7 billion for the first six months of 2019, down 8 percent from the first six months of 2018. The decrease was primarily due to a 4 percent decline in volume, a 3 percent decline in currency, and a 1 percent decline in local price. Rest of World organic growth was 7 percent compared to the prior-year period.

The decline in volume was driven by weather-related impacts in North America and the impact of early deliveries of corn seed in the fourth quarter 2018, which were partially offset by favorable corn seed demand in EMEA. Unfavorable currency impacts were driven predominately by the Euro. The decrease in local price was driven by the impact of the North American market.

Seed pro forma operating EBITDA was $1.4 billion for the first six months of 2019, a decline of 15 percent compared to the first six months of 2018 on a pro forma basis. Volume declines in North America, competitive pricing pressure and the unfavorable impact of currency more than offset cost synergies in R&D and ongoing cost reductions.

Second Quarter Conference Call

The Company will host a live webcast of its second quarter earnings conference call with investors to discuss its results and outlook today at 9:00 a.m. ET. The slide presentation that accompanies the conference call will be posted on the Company’s Investor Events and Presentations page. A replay of the webcast will also be available on the Investor Events and Presentations page.

About Corteva Agriscience

Corteva Agriscience is a publicly traded, global pure-play agriculture company that provides farmers around the world with the most complete portfolio in the industry - including a balanced and diverse mix of seed, crop protection and digital solutions focused on maximizing productivity to enhance yield and profitability. With some of the most recognized brands in agriculture and an industry-leading product and technology pipeline well positioned to drive growth, the Company is committed to working with stakeholders throughout the food system as it fulfills its promise to enrich the lives of those who produce and those who consume, ensuring progress for generations to come. Corteva Agriscience became an independent public company on June 1, 2019, and was previously the Agriculture Division of DowDuPont. More information can be found at www.corteva.com.

Follow Corteva Agriscience on Facebook, Instagram, LinkedIn, Twitter and YouTube.

5

Cautionary Statement About Forward-Looking Statements

This communication 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 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” 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 DuPont, 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) effect of competition and consolidation in Corteva’s industry; (ii) failure to successfully develop and commercialize Corteva’s pipeline; (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 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; (xvi) failure to benefit from significant cost synergies and risks related to the indemnification obligations of legacy DuPont 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; and (xxiii) risks related to the discontinuation of LIBOR.

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, 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, 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 is included in the “Risk Factors” section of Exhibit 99.1 of Amendment No. 4 to Corteva’s Registration Statement on Form 10 and of Corteva’s

6

Quarterly Report on Form 10-Q for the period ended March 31, 2019, as modified by subsequent reports on Form 10-Q and Current Reports on Form 8-K.
 
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 prior 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, the divestiture of Historical DuPont’s specialty products and materials science businesses, the receipt of Dow AgroSciences, debt retirement transactions related to paying off or retiring portions of E. I. du Pont de Nemours and Company ("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 Amendment No. 4 of Corteva’s registration statement on Form 10 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.

Non-GAAP Financial Measures 
This earnings release includes information that does not conform to U.S. GAAP and are considered non-GAAP measures. These measures include organic sales, operating EBITDA, pro forma operating EBITDA, segment operating EBITDA, pro forma segment operating EBITDA, operating earnings per share, 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. Reconciliations for these non-GAAP measures to U.S. GAAP are provided in the Selected Financial Information and Non-GAAP Measures starting on page 13. 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.  See Article 11 Pro Forma Combined Statements of Operations starting on page 21.

Corteva does not provide forward-looking U.S. GAAP financial measures or a reconciliation of forward-looking non-GAAP financial measures to the most comparable U.S. GAAP financial measures on a forward-looking basis because the company is unable to predict with reasonable certainty the ultimate outcome of pending litigation, unusual gains and losses, foreign currency exchange gains or losses and potential future asset impairments, as well as discrete taxable events, without unreasonable effort. These items are uncertain, depend on various factors, and could have a material impact on U.S. GAAP results for the guidance period.

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 costs, net and foreign exchange gains (losses), excluding the impact of adjusted significant items. 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. Segment Operating EBITDA is defined as Operating EBITDA excluding corporate expenses. Operating earnings and operating earnings per share are defined as "Earnings per common share from continuing operations - diluted" excluding the after-tax impact of significant items, 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 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

7

revenue generation. Amortization of intangible assets that relate to past acquisitions will recur in future periods until such intangible assets have been fully amortized.
 
® TM SM Trademarks and service marks of Dow AgroSciences, DuPont or Pioneer, and their affiliated companies or their respective owners.
# # #
8/1/19

Media Contact:
Gregg M. Schmidt
+1-302-485-3260
gregg.m.schmidt@corteva.com

Investor Contact:
Megan Britt
+1-302-485-3279
megan.britt@corteva.com


8
9
Corteva, Inc.
Consolidated Statements of Operations
(Dollars in millions, except per share amounts)


 
 
 
 
 
 
 
 
 
Three Months Ended June 30,
 
Six Months Ended
June 30,
 
2019
 
2018
 
2019
 
2018
Net sales
$
5,556

 
$
5,731

 
$
8,952

 
$
9,525

Cost of goods sold
3,047

 
3,687

 
5,258

 
6,439

Research and development expense
269

 
354

 
568

 
685

Selling, general and administrative expenses
937

 
965

 
1,672

 
1,714

Amortization of intangibles
113

 
107

 
214

 
196

Restructuring and asset related charges - net
60

 
101

 
121

 
231

Integration and separation costs
330

 
249

 
542

 
444

Other income - net
—

 
128

 
31

 
111

Loss on early extinguishment of debt
13

 
—

 
13

 
—

Interest expense
34

 
88

 
93

 
169

Income (loss) from continuing operations before income taxes
753


308


502


(242
)
Provision for (benefit from) income taxes on continuing operations
270


(67
)

203


(179
)
Income (loss) from continuing operations after income taxes
483


375


299


(63
)
(Loss) Income from discontinued operations after income taxes
(1,077
)
 
323

 
(717
)
 
674

 
 
 
 
 
 
 
 
Net (loss) income
(594
)
 
698

 
(418
)
 
611

 
 
 
 
 
 
 
 
Net income attributable to noncontrolling interests
14


4


26


24

 
 
 
 
 
 
 
 
Net (loss) income attributable to Corteva
$
(608
)
 
$
694

 
$
(444
)
 
$
587

 
 
 
 
 
 
 
 
Basic (loss) earnings per share of common stock:
 
 
 
 
 
 
 
Basic earnings (loss) per share of common stock from continuing operations
$
0.63

 
$
0.49

 
$
0.37

 
$
(0.11
)
Basic (loss) earnings per share of common stock from discontinued operations
(1.44
)
 
0.43

 
(0.96
)
 
0.89

Basic (loss) earnings per share of common stock1
$
(0.81
)
 
$
0.92

 
$
(0.59
)
 
$
0.78

 
 
 
 
 
 
 
 
Diluted (loss) earnings per share of common stock:
 
 
 
 
 
 
 
Diluted earnings (loss) per share of common stock from continuing operations
$
0.63

 
$
0.49

 
$
0.37

 
$
(0.11
)
Diluted (loss) earnings per share of common stock from discontinued operations
(1.44
)
 
0.43

 
(0.96
)
 
0.89

Diluted (loss) earnings per share of common stock1
$
(0.81
)
 
$
0.92

 
$
(0.59
)
 
$
0.78

 
 
 
 
 
 
 
 
Average number of shares outstanding used in earnings per share (EPS) calculation2
 
 
 
 
 
 
 
  Basic
749.4

 
749.4

 
749.4

 
749.4

  Diluted
750.0

 
749.4

 
749.7

 
749.4

1.
The sum of the individual earnings per share amounts from continuing operations and discontinued operations may not equal the total company earnings per share amounts due to rounding.
2.
On June 1, 2019, DuPont de Nemours, Inc. ("DuPont") distributed 748,815,000 shares of Corteva, Inc. common stock to holders of its common stock. Basic and diluted (loss) earnings per common share for the three and six months ended June 30, 2018 were calculated using the shares distributed on June 1, 2019 plus 582,000 of additional shares in which accelerated vesting conditions have been met.




10
Corteva, Inc.
Condensed Consolidated Balance Sheets
(Dollars in millions, except per share amounts)

 
 
 
 
 
 
 
June 30,
2019
 
December 31,
2018
 
June 30,
2018
Assets
 
 
 
 
 
 
Current assets
 
 
 
 
 
 
Cash and cash equivalents
 
$
2,077

 
$
2,270

 
$
2,696

Marketable securities
 
6

 
5

 
49

Accounts and notes receivable, net
 
7,434

 
5,260

 
7,331

Inventories
 
3,918

 
5,310

 
4,362

Other current assets
 
1,086

 
1,038

 
1,181

Assets of discontinued operations
 
—

 
9,089

 
9,022

Total current assets
 
14,521

 
22,972

 
24,641

Investment in nonconsolidated affiliates
 
64

 
138

 
195

Property, plant and equipment, net of accumulated depreciation
  (June 30, 2019 - $3,207, December 31, 2018 - $2,796 and June 30, 2018
  $2,598)
 
4,543

 
4,544

 
4,463

Goodwill
 
10,249

 
10,193

 
14,612

Other intangible assets
 
11,832

 
12,055

 
12,318

Deferred income taxes
 
325

 
304

 
419

Other assets
 
2,464

 
1,932

 
1,909

Assets of discontinued operations - noncurrent
 
—

 
56,354

 
57,381

Total Assets
 
$
43,998

 
$
108,492

 
$
115,938

 
 
 
 
 
 
 
Liabilities and Equity
 
 
 
 
 
 
Current liabilities
 
 
 
 
 
 
Short-term borrowings and capital lease obligations
 
$
2,058

 
$
2,154

 
$
3,715

Accounts payable
 
3,139

 
3,798

 
3,629

Income taxes payable
 
282

 
186

 
249

Accrued and other current liabilities
 
3,135

 
4,005

 
2,689

Liabilities of discontinued operations
 
—

 
3,167

 
2,767

Total current liabilities
 
8,614

 
13,310

 
13,049

Long-term borrowings and capital lease obligations
 
117

 
5,784

 
9,736

Other Noncurrent Liabilities
 
 
 
 
 
 
Deferred income tax liabilities
 
1,430

 
1,480

 
1,387

Pension and other post employment benefits - noncurrent
 
5,538

 
5,677

 
6,474

Other noncurrent obligations
 
2,156

 
1,795

 
1,960

Liabilities of discontinued operations - noncurrent
 
—

 
5,293

 
5,629

Total noncurrent liabilities
 
9,241

 
20,029

 
25,186

 
 
 
 
 
 
 
Commitments and contingent liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
Stockholders' equity
 
 
 
 
 
 
Common stock, $0.01 par value; 1,666,666,667 shares authorized;
issued at June 30, 2019, December 31, 2018, and June 30, 2018 - 748,815,000
 
7

 
—

 
—

Additional paid-in capital
 
28,157

 
—

 
—

Divisional equity
 
—

 
78,020

 
79,390

Retained earnings
 
97

 
—

 
—

Accumulated other comprehensive loss
 
(2,375
)
 
(3,360
)
 
(2,185
)
Total Corteva stockholders' equity
 
25,886

 
74,660

 
77,205

Noncontrolling interests
 
257

 
493

 
498

Total equity
 
26,143

 
75,153

 
77,703

Total Liabilities and Equity
 
$
43,998

 
$
108,492

 
$
115,938


11
Corteva, Inc.
Pro Forma Consolidated Statements of Operations1 
(Dollars in millions, except per share amounts)

 
 
 
 
 
 
 
 
 
Three Months Ended June 30,
 
Six Months Ended
June 30,
 
2019 2
 
2018
 
2019
 
2018
Net sales
$
5,556

 
$
5,731

 
$
8,952

 
$
9,525

Cost of goods sold
3,047

 
3,024

 
5,069

 
5,155

Research and development expense
269

 
353

 
568

 
684

Selling, general and administrative expenses
937

 
966

 
1,675

 
1,715

Amortization of intangibles
113

 
107

 
214

 
196

Restructuring and asset related charges - net
60

 
101

 
121

 
231

Integration and separation costs
330

 
126

 
430

 
250

Other income - net
—

 
128

 
31

 
111

Loss on early extinguishment of debt
13

 
—

 
13

 
—

Interest expense
34

 
21


48


38

Income from continuing operations before income taxes
753

 
1,161


845


1,367

Provision for income taxes on continuing operations
270


193


250


222

Income from continuing operations after income taxes
483


968


595


1,145

 
 
 
 
 
 
 
 
Net income from continuing operations attributable to noncontrolling interests
13


5


21


18

 
 
 
 
 
 
 
 
Net income from continuing operations attributable to Corteva
$
470


$
963

 
$
574


$
1,127

 
 
 
 
 
 
 
 
Basic earnings per share of common stock from continuing operations
$
0.63

 
$
1.29

 
$
0.77

 
$
1.50

 
 
 

 
 
 
 
Diluted earnings per share of common stock from continuing operations
$
0.63


$
1.29

 
$
0.77


$
1.50

 
 
 
 
 
 
 
 
Average number of shares outstanding used in earnings per share (EPS) calculation 3
 
 
 
 
 
 
 
  Basic
749.4

 
749.4

 
749.4

 
749.4

  Diluted
750.0

 
749.4

 
749.7

 
749.4


1.
See Article 11 Pro Forma Combined Statements of Operations beginning on page 21.
2.
The three months ended June 30, 2019 are on an as reported basis.
3.
On June 1, 2019, DuPont de Nemours, Inc. ("DuPont") distributed 748,815,000 shares of Corteva, Inc. common stock to holders of its common stock. Basic and diluted (loss) earnings per common share for the three and six months ended June 30, 2018 were calculated using the shares distributed on June 1, 2019.




12
Corteva, Inc.
Consolidated Segment Information
(Dollars in millions)


 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
SEGMENT NET SALES - SEED
 
2019
 
2018
 
2019
 
2018
    Corn
 
$
2,309

 
$
2,248

 
$
3,777

 
$
3,945

    Soybean
 
998

 
1,214

 
1,129

 
1,395

    Other oilseeds
 
200

 
194

 
425

 
457

    Other
 
192

 
208

 
335

 
368

Seed
 
$
3,699

 
$
3,864

 
$
5,666

 
$
6,165

 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
SEGMENT NET SALES - CROP PROTECTION
 
2019
 
2018
 
2019
 
2018
    Herbicides
 
$
1,044

 
$
1,068

 
$
1,815

 
$
1,931

    Insecticides
 
459

 
448

 
836

 
777

    Fungicides
 
302

 
269

 
522

 
547

    Other
 
52

 
82

 
113

 
105

Crop Protection
 
$
1,857

 
$
1,867

 
$
3,286

 
$
3,360

 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
GEOGRAPHIC NET SALES - SEED
 
2019
 
2018
 
2019
 
2018
North America 1
 
$
3,099


$
3,279


$
4,012


$
4,478

EMEA 2
 
274


267


1,078


1,089

Asia Pacific
 
139


147


211


220

Latin America
 
187


171


365


378

Rest of World
 
600

 
585

 
1,654

 
1,687

Net Sales
 
$
3,699

 
$
3,864

 
$
5,666

 
$
6,165

 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
GEOGRAPHIC NET SALES - CROP PROTECTION
 
2019
 
2018
 
2019
 
2018
North America 1
 
$
686


$
847


$
1,165


$
1,419

EMEA 2
 
393


420


953


994

Asia Pacific
 
312


284


515


466

Latin America
 
466


316


653


481

Rest of World
 
1,171

 
1,020

 
2,121

 
1,941

Net Sales
 
$
1,857

 
$
1,867

 
$
3,286

 
$
3,360

 
 
 
 
 
 
 
 
 
1. Reflects U.S. & Canada
 
 
 
 
 
 
 
 
2. Reflects Europe, Middle East, and Africa
 
 
 
 
 
 
 
 



13
Corteva, Inc.
Reconciliation of Non-GAAP Measures
(Dollars in millions, except per share amounts)

 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
 
2019
 
2018
 
2019
 
2018
SEGMENT OPERATING EBITDA
 
Pro Forma
 
Pro Forma
 
Pro Forma
 
Pro Forma
Seed
 
$
1,036

 
$
1,158

 
$
1,361

 
$
1,598

Crop Protection
 
450

 
423

 
670

 
746

Segment Operating EBITDA
 
$
1,486

 
$
1,581

 
$
2,031

 
$
2,344

 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
 
2019
 
2018
 
2019
 
2018
RECONCILIATION OF INCOME FROM CONTINUING OPERATIONS AFTER INCOME TAXES TO OPERATING EBITDA
 
As Reported
 
Pro Forma
 
Pro Forma
 
Pro Forma
Pro forma income from continuing operations after income taxes (GAAP)
 
$
483


$
968


$
595


$
1,145

Provision for income taxes on continuing operations
 
270


193


250


222

Pro forma income from continuing operations before income taxes (GAAP)
 
753

 
1,161

 
845

 
1,367

Depreciation and amortization
 
227

 
237

 
485

 
452

Interest income
 
(17
)
 
(24
)
 
(33
)
 
(51
)
Interest expense
 
34

 
21


48


38

Exchange losses - net
 
32

 
1

 
59

 
66

Non-operating benefits - net1
 
(32
)

(55
)
 
(74
)
 
(106
)
Significant items charge
 
455


203

 
640

 
507

Operating EBITDA (Non GAAP)
 
1,452

 
1,544

 
1,970

 
2,273

Corporate expenses
 
34

 
37

 
61

 
71

Segment Operating EBITDA (Non GAAP)
 
$
1,486

 
$
1,581

 
$
2,031

 
$
2,344

1.
Non-operating (benefit) costs—net consists of non-operating pension and other post-employment benefit (OPEB) (benefit) costs, environmental remediation and legal costs associated with legacy businesses and sites of Historical DuPont.


14
Corteva, Inc.
Reconciliation of Non-GAAP Measures
(Dollars in millions, except per share amounts)

PRICE - VOLUME - CURRENCY ANALYSIS
REGION
 
 
 
Q2 2019 vs. Q2 2018
Percent Change Due To:
 
Net Sales Growth (GAAP)
Organic Growth (Non-GAAP) 
Local Price &
 
 
Portfolio /
 
$
%
$
%
Product Mix
Volume
Currency
Other
North America
$
(341
)
(8
)%
$
(323
)
(8
)%
(3
)%
(5
)%
—
 %
—
 %
EMEA
(20
)
(3
)%
39

6
 %
1
 %
5
 %
(9
)%
—
 %
Asia Pacific
20

5
 %
42

10
 %
7
 %
3
 %
(5
)%
—
 %
Latin America
166

34
 %
189

39
 %
2
 %
37
 %
(5
)%
—
 %
Rest of World
166

10
 %
270

17
 %
3
 %
14
 %
(7
)%
—
 %
Total
$
(175
)
(3
)%
$
(53
)
(1
)%
(1
)%
—
 %
(2
)%
—
 %
 
 
 
 
 
 
 
 
 
SEED
 
 
 
 
 
 
 
 
 
Q2 2019 vs. Q2 2018
Percent Change Due To:
 
Net Sales Growth (GAAP)
Organic Growth (Non-GAAP) 
Local Price &
 
 
Portfolio /
 
$
%
$
%
Product Mix
Volume
Currency
Other
North America
$
(180
)
(5
)%
$
(167
)
(5
)%
(2
)%
(3
)%
—
 %
—
 %
EMEA
7

3
 %
35

13
 %
(1
)%
14
 %
(10
)%
—
 %
Asia Pacific
(8
)
(5
)%
(1
)
—
 %
1
 %
(1
)%
(5
)%
—
 %
Latin America
16

9
 %
23

13
 %
(1
)%
14
 %
(4
)%
—
 %
Rest of World
15

3
 %
57

10
 %
—
 %
10
 %
(7
)%
—
 %
Total
$
(165
)
(4
)%
$
(110
)
(3
)%
(2
)%
(1
)%
(1
)%
—
 %
 
 
 
 
 
 
 
 
 
CROP PROTECTION
 
Q2 2019 vs. Q2 2018
Percent Change Due To:
 
Net Sales Growth (GAAP)
Organic Growth (Non-GAAP) 
Local Price &
 
 
Portfolio /
 
$
%
$
%
Product Mix
Volume
Currency
Other
North America
$
(161
)
(19
)%
$
(156
)
(18
)%
(5
)%
(13
)%
—
 %
(1
)%
EMEA
(27
)
(6
)%
4

1
 %
2
 %
(1
)%
(7
)%
—
 %
Asia Pacific
28

10
 %
43

15
 %
11
 %
4
 %
(5
)%
—
 %
Latin America
150

47
 %
166

52
 %
3
 %
49
 %
(5
)%
—
 %
Rest of World
151

15
 %
213

21
 %
5
 %
16
 %
(6
)%
—
 %
Total
$
(10
)
(1
)%
$
57

3
 %
—
 %
3
 %
(4
)%
—
 %


15
Corteva, Inc.
Reconciliation of Non-GAAP Measures
(Dollars in millions, except per share amounts)

PRICE - VOLUME - CURRENCY ANALYSIS
REGION
 
 
 
First Half 2019 vs. First Half 2018
Percent Change Due To:
 
Net Sales Growth (GAAP)
Organic Growth (Non-GAAP) 
Local Price &


Portfolio /
 
$
%
$
%
Product Mix
Volume
Currency
Other
North America
$
(720
)
(12
)%
$
(690
)
(12
)%
(2
)%
(10
)%
—
 %
—
 %
EMEA
(52
)
(2
)%
143

7
 %
1
 %
6
 %
(9
)%
—
 %
Asia Pacific
40

6
 %
80

12
 %
7
 %
5
 %
(6
)%
—
 %
Latin America
159

19
 %
214

25
 %
4
 %
21
 %
(6
)%
—
 %
Rest of World
147

4
 %
437

12
 %
3
 %
9
 %
(8
)%
—
 %
Total
$
(573
)
(6
)%
$
(253
)
(3
)%
—
 %
(3
)%
(3
)%
—
 %
 
 
 
 
 
 
 
 
 
SEED
 
 
 
 
 
 
 
 
 
First Half 2019 vs. First Half 2018
Percent Change Due To:
 
Net Sales Growth (GAAP)
Organic Growth (Non-GAAP) 
Local Price &


Portfolio /
 
$
%
$
%
Product Mix
Volume
Currency
Other
North America
$
(466
)
(10
)%
$
(450
)
(10
)%
(2
)%
(8
)%
—
 %
—
 %
EMEA
(11
)
(1
)%
98

9
 %
1
 %
8
 %
(10
)%
—
 %
Asia Pacific
(9
)
(4
)%
6

3
 %
2
 %
1
 %
(7
)%
—
 %
Latin America
(13
)
(3
)%
8

2
 %
—
 %
2
 %
(5
)%
—
 %
Rest of World
(33
)
(2
)%
112

7
 %
1
 %
6
 %
(9
)%
—
 %
Total
$
(499
)
(8
)%
$
(338
)
(5
)%
(1
)%
(4
)%
(3
)%
—
 %
 
 
 
 
 
 
 
 
 
CROP PROTECTION
 
First Half 2019 vs. First Half 2018
Percent Change Due To:
 
Net Sales Growth (GAAP)
Organic Growth (Non-GAAP) 
Local Price &


Portfolio /
 
$
%
$
%
Product Mix
Volume
Currency
Other
North America
$
(254
)
(18
)%
$
(240
)
(17
)%
(2
)%
(15
)%
(1
)%
—
 %
EMEA
(41
)
(4
)%
45

5
 %
1
 %
4
 %
(9
)%
—
 %
Asia Pacific
49

11
 %
74

16
 %
9
 %
7
 %
(5
)%
—
 %
Latin America
172

36
 %
206

43
 %
6
 %
37
 %
(7
)%
—
 %
Rest of World
180

9
 %
325

17
 %
4
 %
13
 %
(8
)%
—
 %
Total
$
(74
)
(2
)%
$
85

3
 %
2
 %
1
 %
(5
)%
—
 %



16
Corteva, Inc.
Significant Items
(Dollars in millions, except per share amounts)

SIGNIFICANT ITEMS BY SEGMENT (PRE-TAX)
 
 
 
 
 
 
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2019
 
2018
 
2019
 
2018
 
As Reported
 
Pro Forma
 
Pro Forma
 
Pro Forma
Seed
$
(101
)
 
$
(37
)
 
$
(152
)
 
$
(83
)
Crop Protection
(2
)
 
24

 
(25
)
 
12

Corporate
(352
)
 
(190
)
 
(463
)
 
(436
)
Total significant items before income taxes
$
(455
)

$
(203
)

$
(640
)

$
(507
)
 
 
 
 
 
 
 
 
SIGNIFICANT ITEMS - PRE-TAX, AFTER-TAX AND EPS IMPACTS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pre-tax
 
After-tax
 
($ Per Share)1
 
 
2019
 
2018
 
2019
 
2018
 
2019
 
2018
1st Quarter
Pro Forma

 
Pro Forma

 
Pro Forma

 
Pro Forma

 
Pro Forma

 
Pro Forma

Integration costs 1
$
(100
)
 
$
(124
)
 
$
(16
)
 
$
(93
)
 
$
(0.02
)
 
$
(0.12
)
Restructuring and asset related charges, net 2
(61
)
 
(130
)
 
(53
)
 
(100
)
 
(0.07
)
 
(0.13
)
Loss on divestiture 3
(24
)
 
—

 
(24
)
 
—

 
(0.03
)
 
—

Income tax items 4
—

 
(50
)
 
—

 
(102
)
 
—

 
(0.14
)
1st Quarter - Total
$
(185
)
 
$
(304
)
 
$
(93
)
 
$
(295
)
 
$
(0.12
)
 
$
(0.39
)
 
 
 
 
 
 
 
 
 
 
 
 
 
2nd Quarter
Actual
 
Pro Forma
 
Actual
 
Pro Forma
 
Actual
 
Pro Forma
Integration and separation costs 1
$
(330
)
 
$
(126
)
 
$
(436
)
 
$
(97
)
 
$
(0.58
)
 
$
(0.13
)
Restructuring and asset related charges, net 2
(60
)
 
(101
)
 
(48
)
 
(81
)
 
(0.06
)
 
(0.11
)
Gain on sale of assets 5
—

 
24

 
—

 
19

 
—

 
0.03

Amortization of inventory step up 6
(52
)
 
—

 
(41
)
 
—

 
(0.06
)
 
—

Loss on early extinguishment of debt 7
(13
)
 
—

 
(10
)
 
—

 
(0.01
)
 
—

Income tax items 
—

 
—

 
—

 
(7
)
 
—

 
(0.01
)
2nd Quarter - Total
$
(455
)

$
(203
)
 
$
(535
)
 
$
(166
)
 
$
(0.71
)
 
$
(0.22
)
 
 
 
 
 
 
 
 
 
 
 
 
 
Year-to-date Total 8
$
(640
)
 
$
(507
)
 
$
(628
)
 
$
(461
)
 
$
(0.84
)
 
$
(0.62
)

1.
Integration costs is included in "Integration and separation costs" on Statement of Operations. Beginning in Q2 2019, this includes both integration and separation costs.

2.
Second quarter and first quarter 2019 included restructuring and asset related charges of $(60) million and $(61) million, respectively. The charge for the second quarter is related to the DowDuPont Cost Synergy Program. The charge for the first quarter related primarily to the DowDuPont Cost Synergy Program and the DowDuPont Agriculture Division Restructuring Program.

Second quarter and first quarter 2018 included restructuring and asset related charges of $(101) million and $(130) million, respectively. The charges in the first half of 2018 related to the DowDuPont Cost Synergy Program.

3.
First quarter 2019 included a loss of $(24) million included in other income - net related to Historical Dow's sale of a joint venture related to synergy actions.

4.
First quarter 2018 includes a $(50) million foreign exchange loss related to adjustments to foreign currency exchange contracts as a result of U.S. tax reform.

5.
Second quarter 2018 includes a gain of $24 million included in other income - net related to an asset sale.

17
Corteva, Inc.
Significant Items
(Dollars in millions, except per share amounts)


6.
Second quarter 2019 includes amortization of inventory step up of $(52) million included in cost of goods sold related to the amortization of the inventory step-up in connection with the Merger.

7.
Second quarter 2019 includes a loss on the early extinguishment of debt of $(13) million related to the difference between the redemption price and the par value of the Make Whole Notes and Term Loan Facility, partially offset by the write-off of unamortized step-up related to the fair value step-up of EID’s debt.

8.
Earnings per share for the year may not equal the sum of quarterly earnings per share due to the changes in average share calculations.

18
Corteva, Inc.
Reconciliation of Non-GAAP Measures
(Dollars in millions, except per share amounts)

Operating Earnings Per Share
 
 
 
 
 
 
 
 
Operating earnings per share is defined as earnings per share from continuing operations – diluted, excluding non-operating benefits - net, amortization of intangibles (existing as of Separation), and significant items.
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
June 30,
 
 
2019
 
20182
 
2019
 
20182
Operating Earnings (Non-GAAP)
 
$
 
$
 
EPS (diluted)
 
EPS (diluted)
Pro forma net income from continuing operations attributable to Corteva (GAAP)
 
$
470


$
963

 
0.63


1.29

Less: Non-operating benefits - net, after tax 1
 
30

 
43

 
0.04

 
0.06

Less: Amortization of intangibles (existing as of Separation), after tax
 
(89
)
 
(86
)
 
(0.12
)
 
(0.11
)
Less: Significant items charge, after tax
 
(535
)
 
(166
)
 
(0.71
)
 
(0.22
)
Operating Earnings (Non-GAAP)
 
$
1,064

 
$
1,172

 
$
1.42

 
$
1.56

Operating Earnings Per Share
 
 
 
 
 
 
 
 
Operating earnings per share is defined as earnings per share from continuing operations – diluted, excluding non-operating benefit - net, amortization of intangibles (existing as of Separation), and significant items.
 
 
 
 
 
 
 
 
 
 
 
Six Months Ended
June 30,
 
 
20192
 
20182
 
20192
 
20182
Operating Earnings (Non-GAAP)
 
$
 
$
 
EPS (diluted)
 
EPS (diluted)
Pro forma net income from continuing operations attributable to Corteva (GAAP)
 
574


1,127

 
0.77


1.50

Less: Non-operating benefits - net, after tax 1
 
61


83

 
0.08

 
0.11

Less: Amortization of intangibles (existing as of Separation), after tax
 
(170
)

(156
)
 
(0.22
)
 
(0.21
)
Less: Significant items charge, after tax
 
(628
)

(461
)
 
(0.84
)
 
(0.62
)
Operating Earnings (Non-GAAP)
 
$
1,311

 
$
1,661

 
$
1.75

 
$
2.22

1.
Non-operating benefits—net consists of non-operating pension and other post-employment benefit (OPEB) (benefit) costs, environmental remediation and legal costs associated with legacy businesses and sites of Historical DuPont.
2.
Periods are presented on a Pro Forma Basis

19
Corteva, Inc.
Reconciliation of Non-GAAP Measures
(Dollars in millions)


Reconciliation of Base Income Tax Rate to Effective Income Tax Rate
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.
 
 
 
 
 
 
 
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2019
 
2018
 
2019
 
2018
 
Pro Forma
 
Pro Forma
 
Pro Forma
 
Pro Forma
Income from continuing operations before income taxes (GAAP)
$
753

 
$
1,161


$
845


$
1,367

Add: Significant items - charge 1
455


203


640


507

           Non-operating benefits - net
(32
)

(55
)

(74
)

(106
)
           Amortization of intangibles (existing as of Separation)
113


107


214


196

Less: Exchange losses, net
(32
)
 
(1
)
 
(59
)
 
(66
)
Income from continuing operations before income taxes, significant items, non-operating benefits - net, merger-related amortization step up, and exchange losses (Non-GAAP)
$
1,321

 
$
1,417

 
$
1,684

 
$
2,030

 
 
 
 
 
 
 
 
Provision for income taxes on continuing operations (GAAP)
$
270


$
193


$
250


$
222

Add: Tax (expenses) benefits on significant items charge
(80
)

37


12


46

          Tax expenses on non-operating benefits - net
(2
)

(12
)

(13
)

(23
)
          Tax benefits on amortization of intangibles (existing as of Separation)
24


21


44


40

          Tax benefits (expenses) on exchange gains/losses
18

 
(44
)
 
12

 
14

Operating provision for income taxes on continuing earnings, excluding exchange losses (Non-GAAP)
$
230

 
$
195

 
$
305

 
$
299

 
 
 
 
 
 
 
 
Effective income tax rate (GAAP)
35.9
 %
 
16.6
 %
 
29.6
 %
 
16.2
 %
Significant items, non-operating benefits, and amortization of intangibles (existing as of Separation) effect
(19.4
)%
 
0.3
 %
 
(11.6
)%
 
(1.7
)%
Tax rate, from continuing operations before significant items, non-operating benefits - net, and amortization of intangibles (existing as of Separation)
16.5
 %
 
16.9
 %
 
18.0
 %
 
14.5
 %
Exchange gains (losses) effect
0.9
 %
 
(3.1
)%
 
0.1
 %
 
0.2
 %
Operating income tax rate from continuing operations (Non-GAAP)
17.4
 %
 
13.8
 %
 
18.1
 %
 
14.7
 %
 
 
 
 
 
 
 
 
1. See Significant Items table for further detail.
 



20
Corteva, Inc.
(Dollars in millions, except per share amounts)


Exchange Gains/Losses
 
 
 
 
 
 
 
 
The company routinely uses forward exchange contracts to offset its net exposures, by currency, related to the foreign currency denominated monetary assets and liabilities of its operations. The objective of this program is to maintain an approximately balanced position in foreign currencies in order to minimize, on an after-tax basis, the effects of exchange rate changes. The net pre-tax exchange gains and losses are recorded in other income - net and the related tax impact is recorded in provision for (benefit from) income taxes on the Consolidated Statements of Operations.
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
 
2019
 
2018
 
2019
 
2018
Subsidiary Monetary Position Gain (Loss)
 
 
 
 
 
 
 
 
Pre-tax exchange gains (losses)
 
$
17

 
$
(178
)
 
$
7

 
$
(62
)
Local tax benefits (expenses)
 
7

 
(3
)
 
(3
)
 
13

Net after-tax impact from subsidiary exchange gains (losses)
 
$
24

 
$
(181
)
 
$
4


$
(49
)
 
 
 
 
 
 
 
 
 
Hedging Program (Loss) Gain
 
 
 
 
 
 
 
 
Pre-tax exchange (losses) gains
 
$
(49
)
 
$
177

 
$
(66
)
 
$
(4
)
Tax benefits (expenses)
 
11

 
(41
)
 
15

 
1

Net after-tax impact from hedging program exchange losses
 
$
(38
)
 
$
136

 
$
(51
)
 
$
(3
)
 
 
 
 
 
 
 
 
 
Total Exchange Loss
 
 
 
 
 
 
 
 
Pre-tax exchange losses
 
$
(32
)

$
(1
)

$
(59
)

$
(66
)
Tax benefits (expenses)
 
18

 
(44
)
 
12

 
14

Net after-tax exchange losses
 
$
(14
)
 
$
(45
)
 
$
(47
)
 
$
(52
)
 
 
 
 
 
 
 
 
 
As shown above, the "Total Exchange Gain (Loss)" is the sum of the "Subsidiary Monetary Position Gain (Loss)" and the "Hedging Program Gain (Loss)."
 
 
 
 
 
 
 
 
 



21
Corteva, Inc.
Article 11 Pro Forma Combined Statement of Operations
(Dollars in millions)


 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
June 30, 2018
 
As Reported Corteva
 
Adjustments
 
Pro Forma Corteva
 
 
Merger1
 
Debt Retirement2
 
Separations Related3
 
Net sales
$
5,731

 
$
—

 
$
—

 
$
—

 
$
5,731

Cost of goods sold
3,687

 
(676
)
 
—

 
13

 
3,024

Research and development expense
354

 
—

 
—

 
(1
)
 
353

Selling, general and administrative expenses
965

 
—

 
—

 
1

 
966

Amortization of intangibles
107

 
—

 
—

 
—

 
107

Restructuring and asset related charges - net
101

 
—

 
—

 
—

 
101

Integration and separation costs
249

 
—

 
—

 
(123
)
 
126

Other income (expense) - net
128

 
—

 
—

 
—

 
128

Loss on early extinguishment of debt
—

 


 


 


 
—

Interest expense
88

 
—

 
(67
)
 
—

 
21

Income (loss) from continuing operations before income taxes
308

 
676

 
67

 
110

 
1,161

Provision for (benefit from) income taxes on continuing operations
(67
)
 
130

 
15

 
115

 
193

Income (loss) from continuing operations after income taxes
375

 
546

 
52

 
(5
)
 
968

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

 
—

 
—

 
—

 
5

 
 
 
 
 
 
 
 
 
 
Net income (loss) from continuing operations attributable to Corteva
$
370

 
$
546

 
$
52

 
$
(5
)
 
$
963

 
 
 
 
 
 
 
 
 
 
Basic earnings (loss) per share of common stock from continuing operations
$
0.49

 
 
 
 
 
 
 
$
1.29

 
 
 
 
 
 
 
 
 

Diluted earnings (loss) per share of common stock from continuing operations
$
0.49

 
 
 
 
 
 
 
$
1.29

 
 
 
 
 
 
 
 
 
 
Average number of shares outstanding used in earnings per share (EPS) calculation:
 
 
 
 
 
 
 
 
 
  Basic
749.4

 
 
 
 
 
 
 
749.4

  Diluted
749.4

 
 
 
 
 
 
 
749.4

1.
Related to the amortization of Historical DuPont’s agriculture business’ inventory step-up recognized in connection with the Merger, as the incremental amortization is directly attributable to the Merger and will not have a continuing impact.
2.
Represents a reduction of interest expense of $67 million for the three months ended June 30, 2018 related to the amortization of the fair value adjustment to Historical DuPont’s long-term debt.
3.
Adjustments directly attributable to the separations and distributions of Corteva Inc. includes the following: elimination of the Telone balances that will not transfer to Corteva as a result of the distribution agreement; elimination of one-time transaction costs directly attributable to the distribution; elimination of the impact of certain manufacturing, leasing and supply agreements entered into in connection with the separation; and the related tax impacts.


22
Corteva, Inc.
Article 11 Pro Forma Combined Statement of Operations
(Dollars in millions)


 
 
 
 
 
 
 
 
 
 
 
Six Months Ended
June 30, 2019
 
As Reported Corteva
 
Adjustments
 
Pro Forma Corteva
 
 
Merger1
 
Debt Retirement2
 
Separations Related3
 
Net sales
$
8,952

 
$
—

 
$
—

 
$
—

 
$
8,952

Cost of goods sold
5,258

 
(205
)
 


 
16

 
5,069

Research and development expense
568

 


 


 


 
568

Selling, general and administrative expenses
1,672

 


 


 
3

 
1,675

Amortization of intangibles
214

 


 


 


 
214

Restructuring and asset related charges - net
121

 


 


 


 
121

Integration and separation costs
542

 


 


 
(112
)
 
430

Other income (expense) - net
31

 


 


 


 
31

Loss on early extinguishment of debt
13

 


 


 


 
13

Interest expense
93

 


 
(45
)
 


 
48

Income (loss) from continuing operations before income taxes
502

 
205

 
45

 
93

 
845

Provision for (benefit from) income taxes on continuing operations
203

 
36

 
10

 
1

 
250

Income (loss) from continuing operations after income taxes
299

 
169

 
35

 
92

 
595

 
 
 
 
 
 
 
 
 
 
Net income (loss) from continuing operations attributable to noncontrolling interests
21

 
—

 
—

 
—

 
21

 
 
 
 
 
 
 
 
 
 
Net income (loss) from continuing operations attributable to Corteva
$
278

 
$
169

 
$
35

 
$
92

 
$
574

 
 
 
 
 
 
 
 
 
 
Basic earnings (loss) per share of common stock from continuing operations
$
0.37

 
 
 
 
 
 
 
$
0.77

 
 
 
 
 
 
 
 
 
 
Diluted earnings (loss) per share of common stock from continuing operations
$
0.37

 
 
 
 
 
 
 
$
0.77

 
 
 
 
 
 
 
 
 
 
Average number of shares outstanding used in earnings per share (EPS) calculation:
 
 
 
 
 
 
 
 
 
  Basic
749.4

 
 
 
 
 
 
 
749.4

  Diluted
749.7

 
 
 
 
 
 
 
749.7

1.
Related to the amortization of Historical DuPont’s agriculture business’ inventory step-up recognized in connection with the Merger, as the incremental amortization is directly attributable to the Merger and will not have a continuing impact.
2.
Represents a reduction of interest expense of 45 million for the six months ended June 30, 2019 related to the amortization of the fair value adjustment to Historical DuPont’s long-term debt.
3.
Adjustments directly attributable to the separations and distributions of Corteva Inc. includes the following: elimination of the Telone balances that will not transfer to Corteva as a result of the distribution agreement; elimination of one-time transaction costs directly attributable to the distribution; elimination of the impact of certain manufacturing, leasing and supply agreements entered into in connection with the separation; and the related tax impacts.


23
Corteva, Inc.
Article 11 Pro Forma Combined Statement of Operations
(Dollars in millions)


 
 
 
 
 
 
 
 
 
 
 
Six Months Ended
June 30, 2018
 
As Reported Corteva
 
Adjustments
 
Pro Forma Corteva
 
 
Merger1
 
Debt Retirement2
 
Separations Related3
 
Net sales
$
9,525

 
$
—

 
$
—

 
$
—

 
$
9,525

Cost of goods sold
6,439

 
(1,315
)
 
—

 
31

 
5,155

Research and development expense
685

 
—

 
—

 
(1
)
 
684

Selling, general and administrative expenses
1,714

 
—

 
—

 
1

 
1,715

Amortization of intangibles
196

 
—

 
—

 
—

 
196

Restructuring and asset related charges - net
231

 
—

 
—

 
—

 
231

Integration and separation costs
444

 
—

 
—

 
(194
)
 
250

Other income (expense) - net
111

 
—

 
—

 
—

 
111

Loss on early extinguishment of debt
—

 
—

 
—

 
—

 
—

Interest expense
169

 
—

 
(131
)
 
—

 
38

Income (loss) from continuing operations before income taxes
(242
)
 
1,315

 
131

 
163

 
1,367

Provision for (benefit from) income taxes on continuing operations
(179
)
 
240

 
31

 
130

 
222

Income (loss) from continuing operations after income taxes
(63
)
 
1,075

 
100

 
33

 
1,145

 
 
 
 
 
 
 
 
 
 
Net income (loss) from continuing operations attributable to noncontrolling interests
18

 
—

 
—

 
—

 
18

 
 
 
 
 
 
 
 
 
 
Net income (loss) from continuing operations attributable to Corteva
$
(81
)
 
$
1,075

 
$
100

 
$
33

 
$
1,127

 
 
 
 
 
 
 
 
 
 
Basic earnings (loss) per share of common stock from continuing operations
$
(0.11
)
 
 
 
 
 
 
 
$
1.50

 
 
 
 
 
 
 
 
 
 
Diluted earnings (loss) per share of common stock from continuing operations
$
(0.11
)
 
 
 
 
 
 
 
$
1.50

 
 
 
 
 
 
 
 
 
 
Average number of shares outstanding used in earnings per share (EPS) calculation:
 
 
 
 
 
 
 
 
 
  Basic
749.4

 
 
 
 
 
 
 
749.4

  Diluted
749.4

 
 
 
 
 
 
 
749.4

1.
Related to the amortization of Historical DuPont’s agriculture business’ inventory step-up recognized in connection with the Merger, as the incremental amortization is directly attributable to the Merger and will not have a continuing impact.
2.
Represents a reduction of interest expense of $131 million for the six months ended June 30, 2018 related to the amortization of the fair value adjustment to Historical DuPont’s long-term debt.
3.
Adjustments directly attributable to the separations and distributions of Corteva Inc. includes the following: elimination of the Telone balances that will not transfer to Corteva as a result of the distribution agreement; elimination of one-time transaction costs directly attributable to the distribution; elimination of the impact of certain manufacturing, leasing and supply agreements entered into in connection with the separation; and the related tax impacts.



q2earningspresentationsl
2Q 2019 Earnings Conference Call August 1, 2019 Insert Risk Classification

 
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 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” 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 DuPont, 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) effect of competition and consolidation in Corteva’s industry; (ii) failure to successfully develop and commercialize Corteva’s pipeline; (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 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; (xvi) failure to benefit from significant cost synergies and risks related to the indemnification obligations of legacy DuPont 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; and (xxiii) risks related to the discontinuation of LIBOR. 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, 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, 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 is included in the “Risk Factors” section of Exhibit 99.1 of Amendment No. 4 to Corteva’s Registration Statement on Form 10 and Corteva’s Quarterly Report on Form 10-Q for the period ended March 31, 2019, as modified by subsequent reports on Form 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 and prior 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, the divestiture of Historical DuPont’s specialty products and materials science businesses, the receipt of Dow AgroSciences, 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 This presentation includes information that does not conform to U.S. GAAP and are considered non-GAAP financial measures. These measures include organic sales, operating EBITDA, pro forma operating EBITDA, operating EBITDA margin, pro forma operating EBITDA margin, segment operating EBITDA, pro forma segment operating EBITDA, operating earnings per share, pro forma operating earnings per share, and operating tax rate. 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. Reconciliations for these non-GAAP measures to their most directly attributable U.S. GAAP measure are provided on slides 15 - 21 of this presentation. 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. Organic sales is defined as price and volume and excludes currency and portfolio impacts. Rest of world organic sales is defined as organic sales for Europe, Middle East and Africa (EMEA), Latin America and Asia Pacific and excludes the North America region (U.S. and Canada). Operating EBITDA is defined as earnings (i.e., income from continuing operations before income taxes) before interest, depreciation, amortization, non-operating costs, net and foreign exchange gains (losses), excluding the impact of adjusted significant items. 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 E. I. du Pont de Nemours and Company (“Historical DuPont”). Operating EBITDA margin is defined as Operating EBITDA as a percentage of net sales. Segment Operating EBITDA is defined as Operating EBITDA excluding corporate expenses. Operating earnings and operating earnings per share are defined as "Earnings per common share from continuing operations - diluted" excluding the after-tax impact of significant items, the after-tax impact of non-operating costs, net, and the after-tax impact of amortization expense associated with intangible assets 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. Operating tax rate is defined as the effective tax rate excluding the impacts of foreign exchange gains (losses), non-operating costs, amortization of intangibles as of Separation, and significant items. Corteva does not provide forward-looking U.S. GAAP financial measures or a reconciliation of forward- looking non-GAAP financial measures to the most comparable U.S. GAAP financial measures on a forward-looking basis because the company is unable to predict with reasonable certainty the ultimate outcome of pending litigation, unusual gains and losses, foreign currency exchange gains or losses and potential future asset impairments, as well as discrete taxable events, without unreasonable effort. These items are uncertain, depend on various factors, and could have a material impact on U.S. GAAP results for the guidance period. All periods for the first quarter of 2019 and prior are on a pro forma basis as discussed above in the paragraph ‘Corteva Unaudited Pro Forma Financial Information’. 3

 
Progress on Five Priorities for Shareholder Value Creation 2Q 2019 Highlights 01 02 03 04 05 Instill a strong Drive disciplined Develop innovative Attain best-in-class Deliver above- culture capital allocation solutions cost structure market growth Launched company- Announced $1 billion Launched new products, Delivered $115 million Reported net sales wide program called share repurchase including Qrome™ corn, in cost synergies, down 3%; Rest of “Execute to Win” program and Enlist E3™ soybean, bringing cumulative World(1) delivered 10% focused on driving an inaugural quarterly Isoclast™ insecticide, total to approximately net sales growth and owner mindset and dividend in line with Arylex™ herbicide, and $200 million through 17% organic sales delivering additional previous Zorvec™ fungicide, and first half – which is growth(2) growth and commitments secured new CP product $50 million better than productivity registrations supporting previous indication continued growth (1) Rest of World is defined as Europe, Middle East and Africa (EMEA), Latin America and Asia Pacific (2) Organic sales growth is a non-GAAP measure. See slide 3 for further discussion. Enlist E3™ soybean trait co-developed with MS Technologies 4

 
2Q 2019 Highlights Net Sales Pro Forma Op. EBITDA(1) 2Q Highlights North America market disruptions $1.54B $5.7B $5.6B negatively impacted net sales and Reported $1.45B Operating operating EBITDA for both segments 3% EBITDA (1) Margin Rest of World net sales increased 10% (1) Organic 80 bps on both volume and price improvement with 15% increase in Crop Protection (2) 1% (2) and 3% increase in Seed 2Q'18 2Q'19 2Q'18 2Q'19 Ramp up of new products in Crop Rest of World Net Sales(3) Op. EBITDA Margin(1) Improvement Protection delivered EBITDA margin improvement for the segment >150 bps margin expansion in Crop Protection Total Organic(1) 10% 17% segment driven by strong early demand in LA Selling, administrative, and R&D costs down 9% Quarter Benefitted from Strong Performance Outside North America (1) Organic Sales, Operating EBITDA and Operating EBITDA Margin are non-GAAP measures. See slide 3 for further discussion. (2) First quarter 2019 and prior year information is on a pro forma basis and was determined in accordance with Article 11 of Regulation S-X. (3) Rest of World is defined as Europe, Middle East and Africa (EMEA), Latin America and Asia Pacific. 5

 
2Q 2019 Regional Highlights North America Latin America Asia Pacific Europe, Middle East, Africa Net Sales $0.7B $4.1B $0.7B $0.7B $3.8B $0.5B Reported Reported $0.4B $0.5B Reported Reported 8% 34% 5% 3% (1) Organic Organic (1) Organic (1) Organic (1) 8% 39% 10% 6% 2Q'18 2Q'19 2Q'18 2Q'19 2Q'18 2Q'19 2Q'18 2Q'19 Regional Highlights Extremely late season Strong early season New product demand Balanced performance Missed spring burn down and $80 million increase due to Pricing on supply- Strong results in corn and nitrogen stabilizer applications early demand constrained, high sunflower seed with Uncertainty on actual planted CP volume growth from demand products indication of market share area persists with USDA picoxy, Dermacor, and Broad based growth gains in growing market acreage re-survey expected herbicides across several markets Strong penetration of August 12th Higher Leptra and and crops Lumiposa seed treatment Elevated CP channel PowerCore Ultra adoption Rinskor™ rice herbicide Zorvec™ fungicide launch inventories impacting Strong early season sales launch in China in grapes and potatoes restocking demand for corn in Brazil Pricing growth in corn Continued product ramp and Argentina and and rice seed of Arylex™ cereal (1) Organic sales growth is a non-GAAP measure. See slide 3 for further discussion. soybeans in Brazil herbicide 6

 
Update on Full Year Operating EBITDA(1) Guidance 1H 2019 Pro Forma Operating EBITDA(1): down 13 percent Key Drivers: ($ in millions) . Estimated North America Market Impact: $120 ($350) $200 $50 › $250 million weather-related reduction New Other › $100 million reduction due to seasonal shifts $2,273 Vol./Price ($200) Products . Strong organic growth outside of N. America in both NA ($120) Market $1,970 Crop Protection and Seed segments Impact . New product pipeline is delivering – strong contribution from new Crop Protection products . $200 million in synergies and actions to curtail (2) (2) spending H1 2018 Synergies Volume & Price ~($180) Input/Launch/ Currency H1 2019 Selling Costs . Headwinds from Crop Protection raw material cost increases Estimated 2H 2019 Pro Forma Operating EBITDA(1): ~ ($70) to $80 Key Drivers: ($ in millions) . Volume shift to 3Q in NA from delayed soybean planting offsetting shift to 2Q from early demand in LA ($201) . Continued growth and price realization on supply- constrained, high demand products ~($70) - $80 . Pipeline delivery pace ahead of expectations . Synergy benefits partially offset by launch investments (2) (2) H2 2018 Synergies New Products NA Q2 to Q3 LA Q3 to Q2 Input/Launch H2 2019E Shift Shift Costs . New productivity initiatives in Seed & Crop Protection manufacturing begin to deliver Updating Full Year Pro Forma Operating EBITDA(1) Guidance to Range from $1.9B to $2.05B (1) Operating EBITDA is a non-GAAP measures. See slide 3 for further discussion (2) First quarter 2019 and prior year information is on a pro forma basis and was determined in accordance with Article 11 of Regulation S-X. 7

 
2Q 2019 Highlights ($’s in millions, except EPS) 2Q 2019 2Q 2018(1) Change Net Sales $5,556 $5,731 (3)% GAAP Net Income from Continuing Operations $483 $968 (50)% Operating EBITDA(2) $1,452 $1,544 (6)% Operating EBITDA Margin(2) 26% 27% ~(80) bps GAAP EPS from Continuing Operations $0.63 $1.29 (51)% Operating EPS(2) $1.42 $1.56 (9)% 2Q 2019 Net Sales 2Q 2019 Op. EBITDA(2) ($ in billions) ($ in billions) Other $1.54B Vol./Price NA Market $5.7B Impact $1.45B $5.6B Q2'18 Op.(1),(2) Synergies Input/Launch/ Currency Q2'19 Op. (2) (2) (2) (2) Volume & Price Q2'18 Net Latin America EMEA Asia Pacific North (2) Currency Q2'19 Net EBITDA Selling Costs EBITDA Sales America Sales Strong organic(2) sales growth across the globe, excluding North America (1) First quarter 2019 and prior year information is on a pro forma basis and was determined in accordance with Article 11 of Regulation S-X. (2) Operating EBITDA, Operating EBITDA margin, Operating earnings per share and organic net sales are non-GAAP measures. See slide 3 for further discussion. 8

 
2Q 2019 Operating EPS(1) Variance $0.06 ($0.25 ) $0.13 Other Vol./Price ($0.05 ) ($0.07) $0.04 NA $1.56 Market Impact Operating $1.42 EPS1 $1.42 Operating1 Operating EPS EPS1 (2) Q2'18 Synergies Volume & Price ~($0.19) Currency Change in Tax EGL Q2'19 Rate Key Drivers Delivered on cost savings from synergies which contributed 13 cents to operating earnings per share on disciplined cost reductions and R&D productivity North America market impact of 25 cents on weather-related delays, reduced planted area and lost Crop Protection applications (1) Operating earnings per share is a non-GAAP measures. See slide 3 for further discussion. (2) First quarter 2019 and prior year information is on a pro forma basis and was determined in accordance with Article 11 of Regulation S-X. 9

 
2Q/1H 2019 Segment Performance Highlights Crop Protection Performance Highlights ($’s in millions) 2Q 2019 2Q 2018(1) 1H 2019(1) 1H 2018(1) . N. America - lost applications in nitrogen/corn and soybean herbicide from weather Net Sales $1,857 $1,867 $3,286 $3,360 . Solid growth from new products, including ZorvecTM fungicide TM Operating EBITDA $450 $423 $670 $746 and Isoclast insecticide, and strong early demand for insecticides in Latin America Operating EBITDA 24.2% 22.7% 20.4% 22.2% . Operating EBITDA pressured by impact of N. America, currency (2) Margin and higher input costs, partially offset by synergies Seed Performance Highlights ($’s in millions) 2Q 2019 2Q 2018(1) 1H 2019(1) 1H 2018(1) . Delayed planting and lower than expected planted area in soybeans, corn and canola in North America; Early deliveries in Net Sales $3,699 $3,864 $5,666 $6,165 Q4’18 impacting 1H’19 Operating EBITDA $1,036 $1,158 $1,361 $1,598 . Strong demand for corn in EMEA . Operating EBITDA 28.0% 30.0% 24.0% 25.9% Operating EBITDA challenged by lower volumes, lower seed Margin(2) margins and currency, partially offset by cost synergies (1) First quarter 2019 and prior year information is on a pro forma basis and was determined in accordance with Article 11 of Regulation S-X. (2) Operating EBITDA Margin is a non-GAAP measure. See slide 3 for further discussion. 10

 
1H 2019 Regional Net Sales Highlights – Crop Protection CP Global Net Sales North Reported Organic(1) Latin Reported Organic(1) America 18% 17% America 36% 43% $3.4B $3.3B Reported 1H 2019 1H 2018 1H 2019 1H 2018 2% Net Sales ($MM) $1,165 $1,419 Net Sales ($MM) $653 $481 Volume Price Currency Portfolio Volume Price Currency Portfolio (1) Organic (15)% (2)% (1)% - % 37% 6% (7)% - % 3% Loss of spring applications - glyphosate, Volume growth on early demand for 1H'18 1H'19 nitrogen, corn and soybean herbicides summer season Robust demand for insecticides and Higher incentives on strong adoption of seed treatment Volume Price Currency Portfolio cross-selling program 1% 2% (5)% - % Reported Organic(1) Asia Reported Organic(1) EMEA 4% 5% Pacific 11% 16% 1H 2019 1H 2018 1H 2019 1H 2018 Rest of World (ex. North America) Net Sales ($MM) $953 $994 Net Sales ($MM) $515 $466 Reported 9% Organic(1) 17% Volume Price Currency Portfolio Volume Price Currency Portfolio 4% 1% (9)% - % 7% 9% (5)% - % Strong demand for ZorvecTM fungicide, Broad based growth across several IsoclastTM insecticide and ArylexTM crops and markets herbicide Growth on product launches – IsoclastTM Currency continues to challenge due to insecticide and RinskorTM and ArylexTM (1) Organic sales growth and Rest of World organic growth are non-GAAP measures. See slide 3 for further discussion. volatility in Euro herbicides 11

 
1H 2019 Regional Net Sales Highlights – Seed Seed Global Net Sales North Reported Organic(1) Latin Reported Organic(1) $6.2B America 10% 10% America 3% 2% $5.7B Reported 1H 2019 1H 2018 1H 2019 1H 2018 8% Net Sales ($MM) $4,012 $4,478 Net Sales ($MM) $365 $378 Volume Price Currency Portfolio Volume Price Currency Portfolio Organic(1) (8)% (2)% - % - % 2% - % (5)% - % 5% 1H'18 1H'19 Impact on planting from unprecedented Strong demand for corn and soybeans in weather Brazil Early shipments in 4Q’18 Solid volume improvement in Mexico Volume Price Currency Portfolio and Argentina (4)% (1)% (3)% - % Reported Organic(1) Asia Reported Organic(1) EMEA 1% 9% Pacific 4% 3% 1H 2019 1H 2018 1H 2019 1H 2018 Rest of World (ex. North America) Net Sales ($MM) $1,078 $1,089 Net Sales ($MM) $211 $220 Volume Price Currency Portfolio Volume Price Currency Portfolio Reported Organic(1) 2% 7% 8% 1% (10)% - % 1% 2% (7)% - % Continued strong demand for corn in Volume growth in Southeast Asia for rice Central Europe and corn Volume and price gains in sunflower Dry weather in Philippines impacting (1) Organic sales growth and Rest of World organic growth are non-GAAP measures. See slide 3 for further discussion. corn demand 12

 
Full Year 2019 Modeling Guidance Updates 2019 Modeling Updates (in millions) Prior Updated Comments Guidance Guidance Net Sales Flat Down 3% Currency headwinds; Flat organic growth(1) Pro Forma Operating EBITDA(1) $2,200 - $2,300 $1,900 - $2,050 ~$250 est. impact from N. America market/weather Interest Expense $150 – 200 $140 - 160 Trending at lower end of prior range after completion of de-levering of legacy debt Operating Tax Rate 19 – 21% 19 - 21% Unchanged Depreciation & Amortization ~$1,000 ~$1,000 Amortization of ~$400 excluded from Op. EPS Net Income from Cont. Ops Not Provided $30 – 40 Attributable to Noncontrolling Interests Exchange Losses, after tax Not Provided $90 – $100 Full-year exchange losses estimate reflects YTD actuals and 2H program costs Diluted Shares (millions) Not Provided 750 – 752 Focus on Shareholder Return - $1B Share Buyback Plan announced and ~$400 million of annual dividends ( (1) Organic sales growth and Operating EBITDA are non-GAAP measures. See slide 3 for further discussion. 13

 
Appendix - Upcoming Investor Presentation . Investor Presentation with Greg Friedman, EVP and CFO . Date: August 15, 2019 – 8:00 a.m. . Updates on stand-alone company financials and modeling assumptions Footnotes 14

 
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 taxes 270 193 250 222 Income from continuing operations before income taxes $ 753 $ 1,161 $ 845 $ 1,367 + Depreciation and Amortization 227 237 485 452 - Interest income (17) (24) (33) (51) + Interest expense 34 21 48 38 + Exchange losses, net 32 1 59 66 + / - Non-operating benefits, net (32) (55) (74) (106) + Significant items 455 203 640 507 Corteva Operating EBITDA (Non-GAAP) 2 $ 1,452 $ 1,544 $ 1,970 $ 2,273 Corporate expenses 34 37 61 71 3 Corteva Segment Operating EBITDA (Non-GAAP) $ 1,486 $ 1,581 $ 2,031 $ 2,344 1. Pro forma income from continuing operations, net of tax, has been prepared in accordance with Article 11 of Regulation S-X and is considered the most directly comparable GAAP measure to Pro Forma Operating EBITDA. 2. Corteva Operating EBITDA is defined as earnings (i.e., income from continuing operations before income taxes) before interest, depreciation, amortization, non- operating costs, net and foreign exchange gains (losses), excluding the impact of adjusted significant items. 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 DuPont. 3. Segment Operating EBITDA is defined as Corteva Operating EBITDA excluding corporate expenses. 15

 
Corteva Selected Segment Information Net sales by segment In millions Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Seed $ 3,699 $ 3,864 $ 5,666 $ 6,165 Crop Protection 1,857 1,867 3,286 3,360 Total net sales $ 5,556 $ 5,731 $ 8,952 $ 9,525 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 Seed $ 1,036 $ 1,158 $ 1,361 $ 1,598 Crop Protection 450 423 670 746 Total Segment Operating EBITDA (Non-GAAP) 1 1,486 1,581 2,031 2,344 Corporate (34) (37) (61) (71) Corteva Operating EBITDA (Non-GAAP) 1 $ 1,452 $ 1,544 $ 1,970 $ 2,273 1. Segment Operating EBITDA is defined as Corteva Operating EBITDA excluding corporate expenses. Corteva Operating EBITDA is defined as earnings (i.e., income from continuing operations before income taxes) before interest, depreciation, amortization, non-operating costs, net and foreign exchange gains (losses), excluding the impact of adjusted significant items. 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 DuPont. Operating EBITDA margin Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 As Reported Pro Forma Pro Forma Pro Forma Seed 28.0% 30.0% 24.0% 25.9% Crop Protection 24.2% 22.7% 20.4% 22.2% 2,3 Total operating EBITDA margin (Non-GAAP) 26.1% 26.9% 22.0% 23.9% 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. 16

 
Corteva significant items (Pretax) Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 In millions As Reported Pro Forma Pro Forma Pro Forma Seed Loss on divestiture $ - $ - $ (24) $ - Restructuring and asset-related (benefits) charges - net (49) (37) (76) (83) Inventory amortization (52) - (52) - Total Seed (101) (37) (152) (83) Crop Protection Gain on sale of assets - 24 - 24 Restructuring and asset-related (benefits) charges - net (2) - (25) (12) Total Crop Protection (2) 24 (25) 12 Corporate Integration costs (330) (126) (430) (250) Loss on debt extinguishment (13) - (13) - Restructuring and asset-related (benefits) charges - net (9) (64) (20) (136) Income tax items 1 - - - (50) Total Corporate (352) (190) (463) (436) Total significant items by segment (Pretax) (455) (203) (640) (507) Total tax impact of significant items (80) 44 12 117 Tax only significant items - (7) - (71) Total significant items charge, net of tax $ (535) $ (166) $ (628) $ (461) 1. 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. 17

 
Corteva Selected Segment Information - 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% 39 6% 1% 5% -9% —% Asia Pacific 20 5% 42 10% 7% 3% -5% —% Latin America 166 34% 189 39% 2% 37% -5% —% Rest of World 166 10% 270 17% 3% 14% -7% —% Total $ (175) -3% $ (53) -1% -1% —% -2% —% Seed 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 $ (180) -5% $ (167) -5% -2% -3% —% —% EM EA 7 3% 35 13% -1% 14% -10% —% Asia Pacific (8) -5% (1) —% 1% -1% -5% —% Latin America 16 9% 23 13% -1% 14% -4% —% Rest of World 15 3% 57 10% —% 10% -7% —% Total $ (165) -4% $ (110) -3% -2% -1% -1% —% Crop Protection 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 $ (161) -19% $ (156) -18% -5% -13% —% -1% EM EA (27) -6% 4 1% 2% -1% -7% —% Asia Pacific 28 10% 43 15% 11% 4% -5% —% Latin America 150 47% 166 52% 3% 49% -5% —% Rest of World 151 15% 213 21% 5% 16% -6% —% Total $ (10) -1% $ 57 3% —% 3% -4% —% 18

 
Corteva Selected Segment Information - Price, Volume Currency Analysis Region First Half 2019 vs. First Half 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 $ (720) -12% $ (690) -12% -2% -10% —% —% EM EA (52) -2% 143 7% 1% 6% -9% —% Asia Pacific 40 6% 80 12% 7% 5% -6% —% Latin America 159 19% 214 25% 4% 21% -6% —% Rest of World 147 4% 437 12% 3% 9% -8% —% Total $ (573) -6% $ (253) -3% —% -3% -3% —% Seed First Half 2019 vs. First Half 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 $ (466) -10% $ (450) -10% -2% -8% —% —% EM EA (11) -1% 98 9% 1% 8% -10% —% Asia Pacific (9) -4% 6 3% 2% 1% -7% —% Latin America (13) -3% 8 2% —% 2% -5% —% Rest of World (33) -2% 112 7% 1% 6% -9% —% Total $ (499) -8% $ (338) -5% -1% -4% -3% —% Crop Protection First Half 2019 vs. First Half 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 $ (254) -18% $ (240) -17% -2% -15% -1% —% EM EA (41) -4% 45 5% 1% 4% -9% —% Asia Pacific 49 11% 74 16% 9% 7% -5% —% Latin America 172 36% 206 43% 6% 37% -7% —% Rest of World 180 9% 325 17% 4% 13% -8% —% Total $ (74) -2% $ 85 3% 2% 1% -5% —% 1. Organic sales is defined as price and volume and excludes currency and portfolio impacts. 19

 
Corteva Selected Non-GAAP Calculation of Corteva Operating EPS Three Months Ended June 30, 2019 2018 2019 2018 $ (millions) $ (millions) EPS (diluted) EPS (diluted) As Reported Pro Forma Pro Forma Pro Forma Net income from continuing operations attributable to Corteva (GAAP) $ 470 $ 963 $ 0.63 $ 1.29 Less: Non-operating benefits - net, after tax 30 43 0.04 0.06 Less: Amortization of intangibles (existing as of Separation), after tax (89) (86) (0.12) (0.11) Less: Significant items charge, after tax (535) (166) (0.71) (0.22) 1 Operating Earnings (Non-GAAP) $ 1,064 $ 1,172 $ 1.42 $ 1.56 Six Months Ended June 30, 2019 2018 2019 2018 $ (millions) $ (millions) EPS (diluted) EPS (diluted) As Reported Pro Forma Pro Forma Pro Forma Net income from continuing operations attributable to Corteva (GAAP) $ 574 $ 1,127 $ 0.77 $ 1.50 Less: Non-operating benefits - net, after tax 61 83 0.08 0.11 Less: Amortization of intangibles (existing as of Separation), after tax (170) (156) (0.22) (0.21) Less: Significant items charge, after tax (628) (461) (0.84) (0.62) 1 Operating Earnings (Non-GAAP) $ 1,311 $ 1,661 $ 1.75 $ 2.22 1. Operating earnings is defined as net income from continuing operations attributable to Corteva excluding the after-tax impact of significant items (including goodwill impairment charges), non-operating costs, 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 20

 
Corteva Selected Non-GAAP Calculation of Corteva Operating 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 - charge 455 203 640 507 Non-operating benefits - net (32) (55) (74) (106) Amortization of intangibles (existing as of Separation) 113 107 214 196 Less: Exchange losses, net (32) (1) (59) (66) Income from continuing operations before income taxes, significant items, non-operating benefits - net, merger-related amortization step up, and exchange losses (Non-GAAP) $ 1,321 $ 1,417 $ 1,684 $ 2,030 Provision for income taxes on continuing operations (GAAP) $ 270 $ 193 $ 250 $ 222 Add: Tax (expenses) benefits on significant items charge (80) 37 12 46 Tax expenses on non-operating benefits - net (2) (12) (13) (23) Tax benefits on amortization of intangibles (existing as of Separation) 24 21 44 40 Tax benefits (expenses) on exchange gains/losses 18 (44) 12 14 Operating provision for income taxes on continuing earnings, excluding exchange losses (Non-GAAP) $ 230 $ 195 $ 305 $ 299 Effective income tax rate (GAAP) 35.9% 16.6% 29.6% 16.2% Significant items, non-operating benefits, and amortization of intangibles (existing as of Separation) effect -19.4% 0.3% -11.6% -1.7% Tax rate, from continuing operations before significant items, non- operating benefits - net, and amortization of intangibles (existing as of Separation) 16.5% 16.9% 18.0% 14.5% Exchange gains (losses) effect 0.9% -3.1% 0.1% 0.2% Operating income tax rate from continuing operations (Non-GAAP) 17.4% 13.8% 18.1% 14.7% 1. Operating 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. 21

 
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