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| We are also benefiting – you’ll recall that we closed the Biologicals acquisitions |
| And good to see you, Steve, looks like another great turnout |
| So, we think that there is a great combination here with a growth industry plus our capabilities to really take these products around the world |
| And I think that there’s – Corteva is really well positioned as a technology owner in all three of these dimensions |
| We have had 2 or 3 years of just very strong crop prices and farmer incomes around the world have been very solid |
| They have very strong balance sheets |
| And I think that, that is a really important milestone for the industry |
| We’re going to talk about out-licensing as a possible and a great opportunity in terms of a growth platform for Corteva because we’re feeling very good about our technology |
| However, when you make reference to the Enlist platform, which is an alternative for farmers to use, what I’d say there is, overall, we’re very pleased with the Enlist platform |
| selling soybean brand, and that is something that we are very, very proud of |
| Now with that said, the Corteva technology right now, we are very pleased with it |
| And I’d say we are expecting another year of earnings growth and margin expansion as Corteva |
| And then even beyond that, so once we get to royalty-neutral, say, by 2030 – 2028, 2029, 2030, the next generation of technology looks really good in our field trials |
| Maybe I will start by just reinforcing something that we feel very, very strongly about and very positively about, which is the strength of our overall balance sheet and the flexibility that it represents |
| The products are performing very well for farmers around the world |
| And the benefits that growers are going to observe, I think when we roll out the technology will be a yield advantage over time |
| And we think that there is going to be just tremendous opportunity |
| We’re seeing good market share gains in all of the core markets |
| Cash flow, as you know, Steve, is also good |
| And by the way, ‘23 was stellar |
| We still anticipate to be very good for the first half and roughly even in terms of EBITDA on a year-to-year basis for the first half of the year |
| They are going to give us another lift in ‘24, full year of ownership plus the combination of those acquisitions together with our, call it, Corteva Biologicals, that is a nice lift both revenue wise and EBITDA wise for 2024 |
| We believe very strongly that we’re going to see significant yield increases based on where we are today and the tools that are available |
| So, it’s really a focused and balanced, if you will, deployment of capital against the backdrop of a strong balance sheet, strong cash flow and the flexibility that, that represents |
| So it’s a significant testimony to not only the technology and the leverage that we’ve been able to gain in the marketplace, but also it’s a true testament to the management that we’re seeing over time of this whole balance between – we always have some, obviously, in-licensing, but now the balance that we’re getting in terms of the strength of the out-licensing |
| So with that backdrop, the EU in the last month or so has made very constructive steps |
| So even though the market conditions are what they are, which we think are not going to help us but certainly not going to hurt us, we think that we are going to be able to show a lot of growth |
| And we were very pleased with the label that came out of that process |
| Now self-help, key, as Chuck said, productivity and cost actions, that’s going to be another $200 million of benefit, goodness to us ‘24 compared to ‘23 |
| And on-farm demand, especially for top technology in seed and CP is still very, very strong |
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| And that’s because, simply put, it’s just getting more difficult to grow a crop |
| So when you compare 1Q of ‘24 to 1Q of ‘23, it’s a very tough comp |
| Steve Byrne With respect to the net royalty reduction, I recall when Corteva was spun out, that was roughly an $800 million drag, which weighed pretty heavily on margins |
| You have had some royalty expense for germplasm and that’s probably significantly down |
| We are going to have to work with growers over multiple years to get them comfortable with the whole new agronomic system, and we are going to have to help them retool how they think about growing corn |
| We’re seeing disease and insect stresses around the world that we haven’t seen before at levels |
| In CP, now, I guess the story is a year older or a little longer than that, this global phenomenon of destocking, we still see the CP market globally as somewhat unbalanced |
| We have yet to really feel the impact of the Crop Protection destocking phenomenon, which really came about significantly in the second quarter |
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