Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Corteva raises forecast as demand for seeds, crop protection products booms

Published 08/04/2022, 05:02 PM
Updated 08/04/2022, 06:50 PM
© Reuters. The logo and trading info for Corteva Agriscience, a former division of DowDuPont, is displayed on a screen at the New York Stock Exchange (NYSE) in New York, U.S., June 3, 2019. REUTERS/Brendan McDermid

© Reuters. The logo and trading info for Corteva Agriscience, a former division of DowDuPont, is displayed on a screen at the New York Stock Exchange (NYSE) in New York, U.S., June 3, 2019. REUTERS/Brendan McDermid

By Ruhi Soni

(Reuters) -Corteva Inc on Thursday raised its full-year sales and profit forecasts as the crop protection products maker benefits from surging demand from farmers looking to cash in on higher prices since the Ukraine war.

The company, which reported a 14% jump in second-quarter operating earnings, also unveiled plans to exit some non-core geographies and product lines as part of a previously announced strategic review.

Corteva (NYSE:CTVA) said it is "right-sizing and optimizing its cost structure" as part of the plan and expects to record related charges of about $400 million through the second quarter of 2023, roughly half of which represents cash payments.

The agricultural chemicals company said it expects run-rate savings of over $200 million by 2025 from the strategic plans.

Corteva expects about $1 billion in total "market-driven headwind costs", including commodity and raw material costs as well as freight logistics, in 2022, a spokesperson said.

Ukraine, long considered the "breadbasket of the Black Sea", saw exports of corn, soybean, and sunflower oil blocked following Russia's invasion early this year.

Corteva, a spin-off of DowDuPont's historic split in 2019, said further information on the review will be shared during its investor day on Sept. 13.

It raised its 2022 net sales forecast range from $17.2 billion to $17.5 billion, from $16.7 billion to $17.0 billion earlier. Full-year operating earnings forecast was lifted to $2.45 to $2.60 per share from $2.35 to $2.55.

© Reuters. The logo and trading info for Corteva Agriscience, a former division of DowDuPont, is displayed on a screen at the New York Stock Exchange (NYSE) in New York, U.S., June 3, 2019. REUTERS/Brendan McDermid

Second-quarter net seed sales grew 4% to $3.95 billion as higher prices offset lower volumes. Crop protection sales increased 25% to $2.31 billion.

It recorded a $45 million charge related to its Russia exit during the reported quarter. Adjusted operating profits rose 14% to $1.20 billion, or $1.64 per share.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.