Corteva, Inc.

Good day and welcome to the Corteva second quarter 2022 earnings call. Today's conference is being recorded. At this time, I would like to turn the conference over to Kim Booth. Please go ahead.

Good morning and welcome to Corteva's second quarter and first half 2022 earnings conference call. Our prepared remarks today will be led by Chuck Magro, Chief Executive Officer, and Dave Anderson, Executive Vice President and Chief Financial Officer. Additionally, Tim Glenn, Executive Vice President, Seed Business Unit, and Robert King, Executive Vice President, Crop Protection Business Unit, will join the Q&A session. We have prepared presentation slides to supplement our remarks during this call, which are posted on the investor relations section of the Corteva website and through the link to our webcast. During this call, we will make forward-looking statements, which are our expectations about the future. These statements are based on current expectations and assumptions that are subject to various risks and uncertainties. Our actual results could materially differ from these statements due to these risks and uncertainties, including but not limited to those discussed on this call and in the risk factors section of our reports filed with the SEC. We do not undertake any duty to update any forward-looking statements. Please note, in today's presentation, we'll be making references to certain non-GAAP financial measures. Reconciliations of the non-GAAP measures can be found in our earnings press release and related schedules, along with our supplemental financial summary slide deck available on our investor relations website. It is now my pleasure to turn the call over to Chuck.

Thanks, Kim. Good morning, everyone, and thank you for joining us. There are several key topics we're excited to share with you today, including our strong results for the first half. Robust customer demand and sustained execution amidst dynamic market conditions resulted in double-digit growth in sales and operating EBITDA. Strong organic sales gains in every region are a testament to continued customer demand for our differentiated, sustainably advantaged technologies. On the seed side, our top-tier genetics continue to be in high demand as growers prioritize yields to help offset inflation. crop protection new product sales surpassed 1 billion dollars for the first half an increase of more than 60% compared to prior year this was led by products like enlist herbicide which has more than doubled in sales compared to the same period last year the enlist system continues to gain traction in the market given its superior performance and grower confidence and we now estimate that Enlist soybeans were planted on at least 45% of U.S. soybean acres in 2022. This is a remarkable feat, considering this technology has only been in the market for three seasons. Market challenges persist, including tightness in supply chains and continued inflationary costs. Despite this, the organization is executing well, utilizing price and productivity actions as well as tight, controllable cost management to offset inflation. Through the half, these actions, along with a mix of new technology products, help to drive margin expansion of almost 130 basis points. Looking forward, we are also taking new strategic and operational actions to further accelerate our performance and create shareholder value. Let's turn to slide five, where I'll provide an update on the progress we've made on our strategic framework. Earlier in the year, we announced that we moved from a matrix organization to a global business unit model to drive overall simplicity and speed of business, while increasing accountability. Today, we are announcing actions associated with a comprehensive strategic portfolio review we recently completed. At the center of our strategic review, we focused on several key priorities, including developing and commercializing differentiated technologies, shaping a performance-driven organization, and maximizing customer experience. As a result of these reviews, we plan to exit non-strategic geographies and product lines while redirecting resources closer to the customer in core markets. we are employing a strategy of differentiation to drive our competitive advantages, bringing unique, sustainable ag technology solutions to growers to drive advancements in global food security, climate change, and the energy transition to include biofuels. I've said from day one at Corteva, our technology engine is a powerful differentiator in terms of value we create for growers, society, and shareholders. We plan to provide a deep dive of our pipeline as part of our upcoming investor day. But here are a few highlights to give you more confidence today. On the seed side, we have nearly 20 times the experimental hybrids in our corn pipeline compared to 10 years ago, a testament to the strength of our data science capabilities. On the crop protection side, as I look forward to 2024, we will have launched 10 new active ingredients 90 of these new products meet our sustainable innovation criteria utilizing this strategy we will prioritize investments to support innovation while also balancing our commitment to return cash to shareholders in fact since 2019 we have returned more than 3 billion to shareholders in the form of share repurchases and dividends now let's turn to the outlook on slide six Recent ag commodity price volatility has increased due to several factors, including the war in Ukraine, increased energy costs, especially in Europe, the strengthening U.S. dollar, and continued cost inflation pressures. Although we expect to see expansion of planted acres in Latin America, global grain supplies remain tight, especially as dry weather casts uncertainty over important growing regions. despite the short-term volatility the outlook for agriculture remains positive we expect record demand for grains and oil seeds in 2022 which we believe will support commodity prices for the next few years as demand continues to outpace supply and we work to rebuild ending stocks farmer income levels remain at near record highs despite increased input costs for fuel and fertilizer We are encouraged by resilient demand as growers prioritize the latest technology and top tier products to increase productivity on the farm. Based on this market outlook and in conjunction with our refocus strategy and second half operating plans, we are raising our previously provided guidance for the full year. Net sales are now expected to grow 11% and operating EBITDA 17% at the midpoint over prior year. This level of operating leverage demonstrates we are on the right track, and I look forward to sharing more of our plans with you soon. With that, let me turn it over to Dave to provide financial details on the half and the outlook.