jetcityimage Introduction With interest rates falling even before the Federal Open Market Committee ("FOMC") cuts the federal funds rate ("FFR"), I have reviewed numerous preferred stocks issued by financial entities, as they account for a vast majority of what's available. The one exception was Hovnanian Enterprises (HOV). This article covers a second non-financial issuer, Corteva (NYSE:CTVA). Reviewed here are both preferreds available: Corteva, Inc., $3.50 Series Cumulative Preferred Stock (NYSE:CTA.PR.A ...

Register for the Virtual Event and Get Updated on Company's Strategy, Innovation and Roadmap for Growth INDIANAPOLIS, Aug. 15, 2024 /PRNewswire/ -- Corteva, Inc. (NYSE: CTVA) is hosting an Investor Day on November 19, 2024 from 9:00 a.m. to 12:30 p.m. Eastern Time. Corteva's Chief Executive Officer Chuck Magro will provide updates on the company's strategy, technology pipeline and financial framework along with the company's senior leadership team. Presentations will be webcast. To access the webcast, you m ...

INDIANAPOLIS, Aug. 15, 2024 /PRNewswire/ -- Corteva, Inc. (NYSE: CTVA) today announced it will release its third quarter 2024 earnings on Wednesday, November 6, 2024, after the stock market close via press release and its website. The earnings will be presented in a live webcast on Thursday, November 7, 2024, at 9:00 a.m. Eastern Time. The slide presentation that accompanies the webcast will be posted on the Company's Investor Events and Presentations page. A replay of the webcast will be available on the I ...

Financial Performance - The company reported net sales of $6,112 million for Q2 2024, a 1% increase compared to Q2 2023, driven by a 2% price increase, partially offset by a 1% unfavorable impact from portfolio changes [185]. - Income from continuing operations after income taxes was $1,056 million in Q2 2024, compared to $880 million in Q2 2023 [185]. - Operating EBITDA for Q2 2024 was $1,917 million, an increase from $1,746 million in Q2 2023, driven by higher Crop Protection volumes and reduced net royalty expenses [185]. - For the six months ended June 30, 2024, net sales were $10,604 million, a 3% decrease from the same period last year, reflecting a 4% decrease in volume [185]. - The company expects net sales for 2024 to be in the range of $17.2 billion to $17.5 billion, with Operating EBITDA projected between $3.4 billion and $3.6 billion [211]. - The company returned approximately $730 million to shareholders during the six months ended June 30, 2024, through share repurchase programs and dividends [185]. - The Board of Directors approved a 6.25% increase in the common stock dividend from $0.16 to $0.17 per share [185]. Cost and Expenses - Cost of goods sold decreased to $2,918 million in Q2 2024 from $3,137 million in Q2 2023, primarily due to ongoing cost and productivity actions, despite higher commodity and input costs [185]. - Research and Development (R&D) expenses increased to $357 million (6% of net sales) in Q2 2024, up from $329 million (5% of net sales) in Q2 2023 [193]. - Selling, General and Administrative (SG&A) expenses were $1,054 million (17% of net sales) for Q2 2024, slightly up from $1,045 million (17% of net sales) in Q2 2023 [194]. - The effective tax rate for Q2 2024 was 21.1%, up from 18.8% in Q2 2023, influenced by geographic mix of earnings and withholding taxes [199][200]. - Other income (expense) - net was $(113) million for Q2 2024, an improvement from $(134) million in Q2 2023, driven by a favorable tax indemnification adjustment [197]. Restructuring and Charges - Restructuring and asset-related charges for Q2 2024 were $92 million, up from $60 million in Q2 2023, mainly related to the Crop Protection Operations Strategy Restructuring Program [185]. - The company anticipates future cash payments related to restructuring charges to be between $90 million and $120 million, primarily for severance and contract terminations [179]. - The Crop Protection Operations Strategy Restructuring Program is expected to yield approximately $100 million in annual savings by 2025 [179]. - The company expects to incur approximately $180 million to $230 million in net pre-tax restructuring charges during 2024 [212]. Segment Performance - Seed net sales for Q2 2024 were $4,331 million, a 2% increase from $4,264 million in Q2 2023, driven by a 5% increase in price [225]. - Segment operating EBITDA for the Seed segment in Q2 2024 was $1,698 million, up 16% from $1,458 million in Q2 2023, with an EBITDA margin improvement of approximately 500 basis points [226]. - Crop Protection segment net sales for Q2 2024 remained flat at $1,781 million compared to Q2 2023, while segment operating EBITDA decreased to $255 million from $320 million [228]. - For the first half of 2024, Crop Protection net sales were $3,522 million, down 11% from $3,970 million in the first half of 2023, primarily due to a 7% decrease in volume and a 4% decline in price [235]. Cash Flow and Liquidity - Cash provided by operating activities for continuing operations was $(1,999) million for the six months ended June 30, 2024, an improvement from $(2,480) million in the same period of 2023, primarily due to favorable changes in working capital [257]. - Cash used for investing activities was $(305) million for the six months ended June 30, 2024, significantly lower than $(1,544) million for the same period in 2023, mainly due to the acquisitions of Stoller and Symborg in 2023 [258]. - Cash provided by financing activities was $1,518 million for the six months ended June 30, 2024, down from $3,379 million in the same period of 2023, attributed to higher borrowings in 2023 for working capital and acquisitions [259]. - Corteva had access to approximately $6.2 billion in committed and uncommitted unused credit lines as of June 30, 2024, providing support for short-term liquidity needs [248]. - The company refinanced its Revolving Credit Facilities in June 2024, extending maturity dates and lowering the facility amount to $2.85 billion for the five-year facility [250]. Legal Proceedings - The company is involved in various legal proceedings, including a lawsuit filed by the FTC alleging unfair competition practices [275]. - Corteva filed a lawsuit against Inari Agriculture, Inc. for claims of Plant Variety Protection infringement and other related issues [277]. - Bayer filed a lawsuit against Corteva in August 2022 regarding E3® soybeans, claiming entitlement to royalties based on two patents, with ongoing discussions for resolution [281]. - Corteva filed a lawsuit against Bayer in October 2022, seeking a declaration that Bayer cannot collect patent royalties on the Roundup Ready® Corn 2 trait after patent expiration, with a trial scheduled for October 2024 [282]. - Environmental litigation related to legacy EIDP businesses includes multiple lawsuits alleging PFOA contamination across the U.S. and the Netherlands, impacting Corteva's current operations [283].

| --- | --- | --- | |-------|-----------------------------------|-------| | | | | | | 2Q 2024 Earnings Conference Call | | | | August 1, 2024 | | Safe Harbor Regarding Forward-Looking Statements 2 Forward-Looking Statements This presentation contains certain estimates and forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, which are intended to be covered by the safe harbor provisions for ...

Corteva, Inc. (NYSE:CTVA) Q2 2024 Earnings Conference Call August 1, 2024 10:00 AM ET Company Participants Kim Booth - Vice President, Investor Relations Chuck Magro - Chief Executive Officer Dave Anderson - Executive Vice President and CFO Tim Glenn - Executive Vice President, Seed Business Unit Robert King - Executive Vice President, Crop Protection Unit Conference Call Participants Vincent Andrews - Morgan Stanley Joel Jackson - BMO Chris Parkinson - Wolfe Research Kevin McCarthy - Vertical David Begleit ...

Core Insights - Corteva, Inc. reported revenue of $6.11 billion for the quarter ended June 2024, reflecting a 1.1% increase year-over-year and exceeding the Zacks Consensus Estimate of $6.1 billion by 0.14% [1] - The company's EPS was $1.83, up from $1.60 in the same quarter last year, surpassing the consensus estimate of $1.74 by 5.17% [1] Revenue Breakdown - Seed revenue was $4.33 billion, slightly below the average estimate of $4.36 billion, with a year-over-year increase of 1.6% [3] - Crop Protection revenue totaled $1.78 billion, marginally missing the estimate of $1.79 billion, showing no change from the previous year [4] - Other Crop Protection revenue was $170 million, below the estimate of $174.47 million, representing a significant decline of 19.8% year-over-year [5] - Seed-Other revenue reached $145 million, compared to the estimate of $171.61 million, marking a 2.1% increase year-over-year [6] - Herbicides revenue was $946 million, falling short of the $994.99 million estimate, with a year-over-year decrease of 4.1% [7] - Insecticides revenue was $415 million, slightly below the estimate of $424.78 million, but showing a strong year-over-year increase of 25.4% [8] - Fungicides revenue was $250 million, below the estimate of $301.89 million, with a minor decline of 0.8% year-over-year [9] - Seed-Soybean revenue was $1.32 billion, matching the estimate and reflecting a 4.9% increase year-over-year [11] - Seed-Corn revenue was $2.68 billion, exceeding the estimate of $2.59 billion, with a 0.4% increase year-over-year [12] - Seed-Other oilseeds revenue was $186 million, below the estimate of $225.09 million, representing a 4.1% decline year-over-year [13] Operating Metrics - Operating EBITDA for Seed was $1.70 billion, surpassing the average estimate of $1.54 billion [14] - Operating EBITDA for Corporate was -$36 million, worse than the average estimate of -$28.88 million [15] Stock Performance - Corteva, Inc. shares have returned +5.2% over the past month, outperforming the Zacks S&P 500 composite, which declined by -0.4% [15]

Core Insights - Corteva, Inc. reported quarterly earnings of $1.83 per share, exceeding the Zacks Consensus Estimate of $1.74 per share, and up from $1.60 per share a year ago, representing an earnings surprise of 5.17% [1] - The company posted revenues of $6.11 billion for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 0.14% and showing a slight increase from $6.05 billion year-over-year [2] - Corteva's shares have increased approximately 15.9% since the beginning of the year, outperforming the S&P 500's gain of 14% [3] Earnings Outlook - The future performance of Corteva's stock will largely depend on management's commentary during the earnings call and the company's earnings outlook [4] - Current consensus EPS estimate for the upcoming quarter is -$0.14 on revenues of $2.77 billion, while for the current fiscal year, the estimate is $2.78 on revenues of $17.29 billion [7] Estimate Revisions - The trend for estimate revisions ahead of the earnings release was unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which investors can track [5] Industry Context - The Agriculture - Operations industry, to which Corteva belongs, is currently ranked in the top 41% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Another company in the same industry, Cibus, is expected to report a quarterly loss of $0.81 per share, reflecting a year-over-year change of +73.4%, with revenues projected at $0.44 million, up 120% from the previous year [9]

Financial Performance - Net sales for Q2 2024 reached $6,112 million, a slight increase from $6,045 million in Q2 2023, representing a growth of 1.1%[1] - Net income attributable to Corteva for Q2 2024 was $1,053 million, compared to $714 million in Q2 2023, marking a significant increase of 47.4%[1] - Basic earnings per share from continuing operations for Q2 2024 was $1.51, up from $1.23 in Q2 2023, an increase of 22.8%[1] - Net income for the six months ended June 30, 2024, was $1,479 million, compared to $1,316 million in the same period of 2023, representing a 12.4% increase[5] - Operating EBITDA for the second quarter of 2024 was $1,917 million, an increase from $1,746 million in 2023, reflecting a growth of 9.8%[11] - Operating earnings (Non-GAAP) for the second quarter of 2024 were $1,905 million, compared to $1,972 million in 2023[30] - Operating Earnings (Non-GAAP) for Q2 2024 reached $1,280 million, compared to $1,139 million in Q2 2023, an increase of 12.4%[33] - Operating Earnings Per Share (Non-GAAP) for Q2 2024 was $1.83, up from $1.60 in Q2 2023, reflecting a growth of 14.4%[33] Sales and Revenue Breakdown - Total net sales for the second quarter of 2024 were $6,112 million, with organic sales increasing to $6,172 million, reflecting a growth of 1% from the previous year[10] - Seed segment net sales for the first half of 2024 reached $7,082 million, up from $6,959 million in 2023, indicating a 1.8% increase[6] - Crop protection segment net sales for the first half of 2024 were $3,522 million, down from $3,970 million in 2023, showing a decrease of 11.3%[7] - North America net sales increased by $81 million, a 2% change compared to Q2 2023, with organic growth of $83 million, also a 2% increase[13] - EMEA region experienced a decline in net sales of $41 million, a 6% decrease, with organic growth of $7 million, a 1% increase[13] - Latin America saw a net sales increase of $42 million, a 7% growth, with organic change also at $41 million, a 7% increase[13] - Asia Pacific reported a net sales decline of $15 million, a 4% decrease, with an organic change of $(4) million, a decrease of 1%[13] - Total net sales for Corteva, Inc. increased by $67 million, a 1% change, with organic growth of $127 million, a 2% increase[13] Expenses and Costs - The cost of goods sold decreased to $2,918 million in Q2 2024 from $3,137 million in Q2 2023, a reduction of 7.0%[1] - Research and development expenses increased to $357 million in Q2 2024, up from $329 million in Q2 2023, reflecting an increase of 8.5%[1] - The company reported capital expenditures of $(262) million for the first half of 2024, slightly higher than $(250) million in the same period of 2023[5] - The company recognized significant restructuring and asset-related charges of $(92) million in the second quarter of 2024, compared to $(60) million in the same quarter of 2023[23] Assets and Liabilities - Total assets as of June 30, 2024, were $41,464 million, down from $42,996 million at the end of 2023, a decrease of 3.6%[2] - Cash and cash equivalents decreased to $1,839 million as of June 30, 2024, from $2,644 million at the end of 2023, a decline of 30.4%[2] - Total current liabilities decreased to $8,953 million as of June 30, 2024, from $10,409 million at the end of 2023, a reduction of 13.9%[3] - Total stockholders' equity increased to $25,421 million as of June 30, 2024, compared to $25,279 million at the end of 2023, an increase of 0.6%[4] Cash Flow and Financing - Cash provided by operating activities for continuing operations was $(1,999) million for the first half of 2024, compared to $(2,480) million in 2023, an improvement of 19.4%[5] - The net change in borrowings for the first half of 2024 was $628 million, compared to $885 million in the same period of 2023[5] - Cash, cash equivalents, and restricted cash equivalents at the end of the period were $2,141 million, down from $2,963 million at the end of the previous year[5] - Free Cash Flow for the first half of 2024 is projected to be between $1,500 million and $2,000 million, with capital expenditures estimated at $630 million[40] Tax and Exchange Losses - The base income tax rate from continuing operations (Non-GAAP) for Q2 2024 was 22.5%, compared to 21.3% in Q2 2023[33] - The company reported a net after-tax exchange loss of $48 million for Q2 2024, compared to a loss of $91 million in Q2 2023[37] - Income from continuing operations before income taxes (GAAP) for Q2 2024 was $1,338 million, up from $1,084 million in Q2 2023, indicating a growth of 23.5%[35] - The effective income tax rate (GAAP) for Q2 2024 was 21.1%, compared to 18.8% in Q2 2023[35] - The company experienced a pre-tax exchange loss of $78 million in Q2 2024, down from a loss of $104 million in Q2 2023[37]

Core Insights - Corteva, Inc. reported solid financial results for the first half of 2024, driven by the strength of its Seed business and effective operational execution [1][3][5] - The Crop Protection industry faced challenges due to residual destocking and competitive pressures, impacting overall performance [1][4][5] - The company has lowered its 2024 revenue and operating EBITDA guidance to align with current market dynamics [1][5][27] Financial Performance - For Q2 2024, Corteva's net sales reached $6.11 billion, a 1% increase compared to Q2 2023, while income from continuing operations was $1.06 billion, reflecting a 20% increase [2][11] - In the first half of 2024, net sales totaled $10.60 billion, down 3% year-over-year, with organic sales decreasing by 2% [3][5] - The Seed business segment achieved a 2% growth in net sales for the first half, driven by a 5% price increase, despite a 1% decline in volume [5][19] Crop Protection Overview - Crop Protection net sales decreased by 11% in the first half of 2024, primarily due to a 7% decline in volume and a 4% decrease in price [5][26] - The Crop Protection segment's operating EBITDA fell by 39% year-over-year, attributed to pricing pressures and raw material cost inflation [26][27] Guidance and Strategic Actions - Corteva updated its full-year 2024 guidance, expecting net sales between $17.2 billion and $17.5 billion, with operating EBITDA projected between $3.4 billion and $3.6 billion [6][27] - The company plans to repurchase approximately $1.0 billion in shares during 2024, indicating a strong balance sheet and cash flow [1][6][27] Market Dynamics - The Crop Protection market is showing signs of stabilization, but competitive pricing pressures remain significant [4][5] - The Seed business continues to outperform the market, likely gaining market share due to strong demand for top-tier technology offerings [5][20]