EIDP Inc

The company operates in two reportable segments: Seed and Crop Protection.

Seed

The company’s Seed segment is a global leader in developing and supplying advanced germplasm and traits that produce optimum yield for farms around the world. The segment is a leader in many of the company’s key seed markets, including North America corn and soybeans, Europe corn and sunflower, as well as Brazil, India, South Africa and Argentina corn. The segment offers trait technologies that improve resistance to weather, disease, insects and enhance food and nutritional characteristics, herbicides used to control weeds, and digital solutions that assist farmer decision-making to help maximize yield and profitability.

Crop Protection

The Crop Protection segment serves the global agricultural input industry with products that protect against weeds, insects and other pests, and disease, and that improve overall crop health both above and below ground via nitrogen management and seed-applied technologies. The segment offers crop protection solutions and digital solutions that provide farmers the tools they need to improve productivity and profitability, and help keep fields free of weeds, insects and diseases. The segment is a leader in global herbicides, insecticides, nitrogen stabilizers, pasture and range management herbicides and biologicals.

Summarized below are comments on individual segment net sales and segment operating EBITDA for the three and six months ended June 30, 2024 compared with the same period in 2023. The company defines segment operating EBITDA as earnings (loss) (i.e., income (loss) from continuing operations before income taxes) before interest, depreciation, amortization, corporate expenses, non-operating benefits (costs), foreign exchange gains (losses), and net unrealized gain or loss from mark-to-market activity for certain foreign currency derivative instruments that do not qualify for hedge accounting, excluding the impact of significant items. Non-operating benefits (costs) consists of non-operating pension and OPEB credits (costs), tax indemnification adjustments and environmental remediation and legal costs associated with legacy EIDP businesses and sites. Tax indemnification adjustments relate to changes in indemnification balances, as a result of the application of the terms of the Tax Matters Agreement, between Corteva and Dow and/or DuPont that are recorded by the company as pre-tax income or expense. See Note 18 - Segment Information, to the interim Consolidated Financial Statements, for details related to significant pre-tax benefits (charges) excluded from segment operating EBITDA. All references to prices are based on local price unless otherwise specified.

A reconciliation of segment operating EBITDA to income (loss) from continuing operations after income taxes for the three and six months ended June 30, 2024 and 2023 is included in Note 18 - Segment Information, to the interim Consolidated Financial Statements.

Seed

Seed net sales were $4,331 million in the second quarter of 2024, up 2 percent from $4,264 million in the second quarter of 2023. The sales increase was driven by a 5 percent increase in price, partially offset by a 2 percent decrease in volume and 1 percent unfavorable portfolio and other impact.

Pricing gains were broad-based, led by North America, on product mix and the continued execution of the company's price for value strategy. Lower volumes were driven by earlier seasonal deliveries in North America versus prior year, partially offset by the delayed season in EMEA into the second quarter. The unfavorable portfolio and other impact was driven primarily by strategic product and geographic exits.

Segment operating EBITDA was $1,698 million in the second quarter of 2024, up 16 percent from $1,458 million in the second quarter of 2023. Price execution, reduction of net royalty expense and ongoing cost and productivity actions more than offset investment in R&D, higher commodity costs, and lower volumes. Segment operating EBITDA margin improved by approximately 500 basis points versus the prior-year period.

Seed net sales were $7,082 million in the first half of 2024, up 2 percent from $6,959 million in the first half of 2023. The sales increase was driven by a 5 percent increase in price, partially offset by a 1 percent decrease each in volume, currency and portfolio and other.

Pricing gains were driven by strong demand for top technology and operational execution globally, with global corn and soybean prices up 6 percent and 4 percent, respectively. Pricing actions more than offset currency impacts in EMEA. The decline in volume was driven by unfavorable weather and lower planted area in EMEA. Unfavorable currency impacts were led by the Turkish Lira, and the portfolio and other decrease was driven primarily by strategic product and geographic exits.

Segment operating EBITDA was $2,446 million in the first half of 2024, up 16 percent from $2,110 million in the first half of 2023. Price execution, reduction of net royalty expense and ongoing cost and productivity actions more than offset higher commodity costs, investment in R&D, the unfavorable impact of currency, and lower volumes. Segment operating EBITDA margin improved by approximately 420 basis points versus the prior-year period.

Crop Protection

Crop Protection net sales were $1,781 million in the second quarter of 2024 and 2023. The flat sales were driven by a 6 percent increase in volume, partially offset by a 5 percent decrease in price and a 1 percent decrease in currency.

The increase in volume was driven primarily by Latin America and North America on demand for new products and spinosyns, partially offset residual destocking and unfavorable weather conditions in EMEA. The price decline was broad-based, reflecting the competitive pricing environment for the Crop Protection industry globally. Unfavorable currency impacts were primarily related to the Chinese Renminbi and Japanese Yen.

Segment Operating EBITDA was $255 million in the second quarter of 2024, down 20 percent from $320 million in the second quarter of 2023. Competitive pricing and raw material cost inflation more than offset volume growth and productivity savings. Segment operating EBITDA margin declined by 365 basis points versus the prior-year period.

Crop Protection net sales were $3,522 million in the first half of 2024, down 11 percent from $3,970 million in the first half of 2023. The sales decrease was driven by a 7 percent decrease in volume, a 4 percent decline in price and a 1 percent decrease in currency, partially offset by a 1 percent favorable portfolio and other impact.

The decrease in volume was primarily due to residual destocking and unfavorable weather impacts in EMEA, as well as just-in-time purchasing behavior in North America. Pricing gains in EMEA, largely to offset currency impact, were more than offset by declines in North America and Latin America, reflecting competitive price pressure. Unfavorable currency impacts were led by the Turkish Lira. The portfolio and other impact was driven by the Biologicals acquisitions.

Segment Operating EBITDA was $565 million in the first half of 2024, down 39 percent from $923 million in the first half of 2023. Pricing pressure, lower volumes, raw material cost inflation and the unfavorable impact of currency more than offset productivity savings. Segment operating EBITDA margin declined by approximately 720 basis points versus the prior-year period.