Corteva (NYSE: CTVA) reported Q4 EPS of $0.07, $0.19 better than the analyst estimate of ($0.12). Revenue for the quarter came in at $3.1 billion versus the consensus estimate of $2.92 billion.

• Full year reported net sales for 2019 were $13.8 billion, down 3% versus the prior year, driven by currency.
• GAAP earnings per share (EPS) from continuing operations were $0.02 for the full year – and GAAP income from continuing operations after taxes was $26 million.
• Outside of North America,3 net sales in 2019 grew 1%, with an increase of 1% in Crop Protection and flat Seed sales. New product sales led to Rest of World organic sales1 growth of 7% in Crop Protection and 6% in Seed.
• Operating EBITDA1 was $2.0 billion, down 4% versus prior year, as weather-related declines in North America and currency impacts were partially offset by cost savings, gain on divestitures, and contribution from new products.
• Merger cost synergies were approximately $350 million for 2019, on track to deliver $1.2 billion by 2021.
• Corteva returned approximately $220 million to shareholders in 2019, in line with previous commitments.

Summary of Fourth Quarter 2019

• For the fourth quarter ended December 31, 2019, reported net sales increased 6% versus the same period last year, with organic sales1 increases of 9%.
• Volumes increased 6% versus the prior-year period. Volume gains in both segments were driven primarily by North America as a result of stronger sales in multi-channel seed brands; penetration of EnlistTM herbicides in preparation for the 2020 planting season; and sales of new products in Latin America and EMEA3.
• Local price increased 3% versus the prior-year period, with higher prices in Latin America due to favorable mix from PowerCore Ultra® sales. Currency was a headwind of 3%, primarily from the Brazilian Real.
• The Company achieved approximately $50 million in merger-related synergies in the quarter.
• GAAP loss from continuing operations after income taxes was $(42) million for the fourth quarter. Operating EBITDA1 was $224 million, a $174 million improvement versus the same period last year on a pro forma basis2.
• Crop Protection operating EBITDA improvement reflects merger-related cost synergies, gains on divestitures, and higher sales. Seed Operating EBITDA improvement reflects pricing gains resulting from favorable mix, merger-related cost synergies and continued productivity.
• The Company reported a loss of $(0.06) for GAAP EPS from continuing operations and operating EPS1 of $0.07 for the fourth quarter 2019.

"Our results show that we capitalized on the strength of our product pipeline to realize above-market organic growth especially outside of North America. We also delivered on our cost-synergy commitments and intensified our productivity actions. In our first six months as a stand-alone company, we demonstrated our collective strengths and our ability to navigate unprecedented market conditions to finish strong."

"As we look forward, we expect more normal weather conditions in North America will set the stage for further performance improvements. We remain committed to driving shareholder value and financial results consistent with our stated priorities," said James C. Collins, Jr., Corteva Chief Executive Officer

GUIDANCE:

Corteva sees FY2020 EPS of $1.45-$1.55, versus the consensus of $1.48. Corteva sees FY2020 revenue of $14.5 billion, versus the consensus of $14.43 billion.

• The Company provided guidance5 for full year 2020 net sales of approximately $14.5 billion and expects operating EBITDA of approximately $2.2 billion for the same period. The Company\'s operating EPS range is expected to be between $1.45 and $1.55 per share.
• Corteva is not able to reconcile its forward-looking non-GAAP financial measures to its most comparable U.S. GAAP financial measures, as it is unable to predict with reasonable certainty items outside of its control, such as significant items, without unreasonable effort.

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