Good day, everyone and welcome to the Corteva Q4 earnings conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Megan Britt. Please go ahead, ma'am.

Good morning and welcome to the fourth quarter and full year 2019 earnings conference call for Corteva Agriscience. The call is available to investors and media via webcast. We have prepared presentation slides to supplement our comments during this call. These slides are posted on the Investor Relations section of the Corteva website and through a link to our webcast. Speaking on the call today are Jim Collins, Chief Executive Officer, Tim Glenn, Executive Vice President and Chief Commercial Officer, Rajan Gajaria, Executive Vice President of Business Platform and Greg Friedman, Executive Vice President and Chief Financial Officer. During this call, we will make forward-looking statements regarding our expectations for the future. Slides two and three of our earnings release contain our forward-looking statement disclaimers. All statements that address expectations or projections about the future are forward-looking statements. These statements reflect our current expectations that are not guarantees of future performance and are subject to risks and uncertainty regarding assumptions. Our SEC filings provide discussion of some of the factors that could cause material differences in our actual results. We are providing information on a pro forma basis, prepared in conformity with regulation S-X to provide the most meaningful comparison. We provide a pro forma basis discussion in our earnings release and slides. Unless otherwise specified, all historical financial measures presented today exclude significant items, which can be found in the schedules that accompany our earnings release. We will also refer to non-GAAP measures. A reconciliation to the most directly comparable GAAP financial measure were available and other associated disclosures are contained in our earnings release and on our website. It's now my pleasure to turn the call over to Jim.

Thank you Megan and thank you and welcome to the participants joining the call. Earlier today, we reported fourth quarter and full year results for 2019. Our key operational performance indicators for the full year are captured on chart four. Net sales on a reported basis decreased 3% versus the prior year, primarily due to currency. On an organic basis, net sales were flat as weather-related declines in North America were offset by above market organic growth in other regions. Outside of North America, reported net sales were up 1% and organic sales were up 7%, demonstrating the strength of our pipeline, brands and multi-channel distribution strategy. Operating EBITDA declined 4% compared to prior year, largely driven by currency and weather-related price and volume declines in North America. Continued realization of cost synergies, disciplined spending actions, increased sales from new products and gains on divestitures were a benefit. Operating EBITDA margin declined 10 basis points for the full year for the company. In crop protection, new product sales and gains on divestitures resulted in margin expansion. In seed, weather-related price and volume declines in North America drove margin decline. Selling, general and administrative and R&D costs declined 4% for the full year due to cost synergy realizations and the benefit from disciplined spending actions. In total, we realized approximately $350 million in cost synergies, accelerating $50 million of savings into 2019 relative to our expectations at the beginning of the year. Overall, these indicators show that we capitalized on the strength of our product pipeline and realized above market organic growth outside of North America. We also delivered on our cost synergy commitments and intensified our productivity actions to support sustainable operating EBITDA expansion. Finally, we acted on our portfolio to divest products that are not aligned with our strategy…

Thanks Jim. Starting on slide seven, I will provide details on how our teams executed around the globed in terms of topline performance. 2019 was a very complex and dynamic ag market, but through all of that, I am proud of how our teams positioned themselves to win in the market and deliver above market growth. In North America, organic net sales were down 6%. Due to the weather-related delays, approximately 11 million fewer acres of corn and soybeans were planted in the U.S. year-over-year. As a result, seed units were down significantly and reduced applications had a negative impact on crop protection. Pricing was challenged due to higher replants in both soybeans and corn, coupled with heightened competitiveness in the marketplace around soybean pricing. Despite a very challenging environment, our teams achieved share gains in both Pioneer corn and soybeans for the year. Additionally, excluding replant, we were able to hold price flat in Pioneer corn. In terms of crop protection inventories, we see elevated levels in the U.S. market, primary in corn and soybean herbicides. We also saw strong early demand in the fourth quarter for Enlist chemistry due to 2020 ramp-up. In Latin America, our teams delivered 8% organic growth led by strong demand for new product. We successfully implemented the brand positioning for Brevant and launched new technology like Powercore Ultra which resulted in share gain in summer corn in Brazil. We did see a more normal start to the second corn crop for safrinha season which limited volumes in the fourth quarter but we expect to see those sales in first quarter 2020. In crop protection, new products like Isoclast insecticides contributed to growth as we obtained registration for the product in Brazil and the overall insecticide market continues to expand. In Asia Pacific, we…

Thank you Tim. Turning to slide nine, highlighting the performance for full year in both our crop protection and seed segment. In crop protection, net sales were $6.3 billion, down 3% from the prior year. The decrease was primarily due to 3% decline from currency. Organic net sales increased 1% from the prior year, partially due to volume improvement on new and differentiated product. The percent of sales from patented and differentiated products for 2019 was approximately 30%, up from approximately 25% in 2018. Crop protection operating EBITDA was approximately $1.1 billion, down 1%. Unfavorable currency, volume declines in North America and higher input costs, excluding synergies drove the decline in EBITDA. The segment delivered on cost synergies and realized a benefit from new products and gain on divestitures. For the full year, crop protection delivered approximately 30 basis points of operating EBITDA margin expansion. In seed, net sales were $7.6 billion, down 3% for the year. Currency was a headwind of 2%. Weather-related impacts in North America were partially offset by growth in other regions, particularly strong demand and pricing on Powercore Ultra corn products in Latin America, new route-to-market enhancements in Europe and market share gains in corn in South Asia. Seed operating EBITDA was approximately $1 billion, down 9% versus the prior year, reflecting the impact of the North America weather-related decline, market competitiveness in soybeans and unfavorable currency. Cost synergies, particularly in R&D and seed production, were a benefit to the segment. Turning now to slide 10 for a closer look at several products that contributed to the full year segment results and are helping to create a clear path for future above-market growth. Starting with insecticide, where the overall market grew 6%, Corteva net sales were $1.7 million, an increase of 10% from the prior…

Thank you Rajan. Turning to slide 11 for a brief overview of our fourth quarter performance. Net sales, on a reported basis, improved 6% versus the prior year, primarily due to strong volumes in both North America and Latin America, partially offset by currency. Organic sales were up 9% with improvements in both segments. In seed, we delivered 13% organic growth led by both volume and price improvements, primarily in North America and Latin America. Specifically, we recorded higher sales in our multi-channel brands in the U.S. versus prior year due to improved supply chain performance. Continued penetration of new products in Latin America drove 8% pricing improvement for the quarter. In crop protection, organic sales improved 7% for the quarter on broad-based growth in most regions, which was led by North America with improved volumes from early demand for Enlist herbicide in advance of the 2020 season. In addition, continued ramp of new products, particularly insecticides, in Europe, Middle East and Africa and Latin America helped drive volume and price improvements. Operating EBITDA of $224 million improved by $174 million compared to prior year, largely driven by higher sales in both segments, continued realization of cost synergies and gains on divestitures. Margins benefited from improved mix from Powercore Ultra in Latin America and demand for new crop protection products like Isoclast insecticide and Enlist herbicide. Gains on divestitures aligned with our ongoing best owner portfolio strategy resulted in approximately $70 million of gains in the quarter. R&D expense was lower by more than $50 million in the quarter compared to prior year, due to cost synergies, timing as well as focused actions to control spending. Turning to slide 12 for a year-over-year comparison of operating EPS. Currency was a $0.19 headwind for the year, primarily from the Brazilian Real…

Thanks Greg. Before we go to Q&A, I wanted to offer a few final comments on a remarkable year. Without a doubt, we will remember 2019 as a historic year for our industry and our company. As we look forward, I am encouraged by our accomplishments as we navigated unprecedented market conditions to deliver a solid finish to the year. We have also laid the groundwork to deliver on our commitments going forward. Now I have said that Corteva is a different kind of agriculture company and part of that difference is how we support our customers and partner with society. The agriculture industry has been facing one of the most challenging periods in history due to weather, trade and regulatory burdens, which have limited access to new innovations and safe and reliable seed and crop protection products. We are encouraged to see a resolution to the trade dispute with China and the passage of the USMCA. We worked closely with the U.S. government to advocate for more transparent and predictable regulatory approvals as part of the trade resolution with China, which helped to secure important approvals for Enlist E3, Qrome and Conkesta. I testified last July in front of the U.S. Senate Finance Committee in support of the USMCA as a vehicle to further expand and modernize North America trade and increase grower and consumer access to innovation. Both trade deals will be positive over the long term for growers and agricultural demand. We feel privileged to use our influence as a public company to drive positive societal impacts. It is our purpose to enrich the lives of those who produce and those who consume, ensuring progress for generations to come. With that, I will turn the call back to Megan.

Thank you Jim. Let's move on to your questions. I would like to remind you that our cautions on forward-looking statements, non-GAAP measures and pro forma financials apply to both our prepared remarks and the following Q&A. Operator, please provide the Q&A instruction.

[Operator Instructions]. And our first question will come from Joel Jackson with BMO Capital Markets.

Good morning, everyone.

Good morning Joel.

Hi. You talked in the past about trying to hit a free cash flow conversion target in 2020 of 50% to maybe a little better than 50%. There wasn't anything on the release or the presentation about that or the remarks today. Maybe give an idea about the puts and takes on free cash flow conversion? Where you might be in 2020? Where you might be in 2021? Thanks.

Yes. Great. Joel, obviously all of that is still coming together and as we close our first full year, we are getting new clarity around those numbers. Greg, do you want to share some more specifics?

Yes. Thanks Jim. As Jim mentioned, 2019 cash flow was a complex year with the first half incorporating cash flow elements from our heritage companies and the second half really represented Corteva's results. And that validated our ability to manage effectively our seasonal working capital movements. So we remain committed to our target of converting more than 50% of our operating EBITDA into free cash flow while continuing to grow the topline and improving our margins. Specifically for 2020, we are focused on driving working capital productivity. That will translate into cash flow improvement in a year where our business is growing. And also, you will notice in our guide, our capital expenses are lower by roughly $100 million than the prior year at the midpoint which is consistent with our commitment to manage capital. In 2020, as I mentioned, it will be the first year that we will have standalone cash flows without discontinued operation and spin related uses of cash. So we will continue to provide updates on our progress on free cash flow conversion for 2020 throughout the year.

Thank you. Our next question will come from David Begleiter with Deutsche Bank.

Thank you, Jim. Just on the soybean price headwind, I think before you were looking at perhaps soybean price mix to be flat North America with price down and mix up, maybe 2% each. Now I think we are looking at pricing in soybean to be down maybe 5% or more. One, is that correct? And two, what caused the change or the more severe pricing headwind in North America?

Great. David, thanks for the question. You are right. We do expect our soybean pricing, primarily in North America, to be down low single digits. And it is a direct response to the market competitiveness that's going on and the aggressiveness that is out there in the market. It is early and early in the invoicing process for soybeans. And we are taking a very selective approach to how we respond to that. And Tim, you are a lot closer to this on a day-to-day basis. Anything else you would highlight?

Yes. Jim, I would highlight that very strong performance in our soybean product line, especially Roundup Ready 2 Xtend portfolio. And we did come out with the expectation of being flat. The year started where our largest competitor in the Roundup Ready 2 Xtend segment came out of the door by taking their prices down low single digits. So that was kind of the environment we entered the season in. And I think our value proposition and our performance advantage in services is holding up well. But it's important to know that we need to take this $50 million and use it on a very selective basis to shore up our position. So this is not a broad price adjustment. It really is a very specific competitive response and we can manage this on a customer-by-customer basis. So just to give you some idea, that $50 million really represents somewhere less than one-half of 1% price adjustment across that business. So it is very specific, very targeted and I think it's really important that we use that to shore up our position in what is a very highly competitive marketplace.

David, I would just add. As I step back and we think about overall pricing, we always put that in the context of three areas. The market backdrop is one of them. And I think we have dealt with that pretty well globally, understanding what our customers are facing. We always put that in the context of our product performance. And I think we have got about the best lineup in the marketplace from a performance perspective. So we are going to continue to price for the value that we deliver. And the third element that Tim mentioned is the competitive response out there. So it is really is, we are focused on one reason and really one product right now and everywhere else in the world, I would say across the board, I feel really good about where we are.

Thank you. Next, we will hear from Vincent Andrews with Morgan Stanley.

Thank you. Good morning. Jim, if I can just ask you on the Enlist rollout that you expect, when do you think you will have Enlist and Pioneer germplasm? And then as do this, can you help us understand sort of the SKU complexity and maybe inventory management decisions you are going to have to make and this is going to impact working capital at all?

Yes. Great. Vincent, thanks for the question. From the beginning of the creation of Corteva, we have talked about creating more choices in the marketplace. And so we are very excited about the announcement that we put out today about our plans to accelerate the ramp-up of Enlist. I think about that ramp-up over the next five years would be kind of the timeframe of where we would expect to get to peak penetration. And it's about a commitment that we are making to the technology and towards that longer term proprietary trait and brand strategy that we have been talking to you about. So a real big proof point here today that we are on that path. The other thing to remember is, we talk about Enlist. It is a system. It includes branded seed sales. So you are right. There is a Pioneer brand element to this. But also our other multi-brands and maybe I have Rajan share a little more about that around how we are going to manage to through the inventory cycle that you were asking about. Remember, this also gives us an out-licensing opportunity. So there is income and revenue from out-licensing. And it's part of that royalty improvement path that we have talked about. So with that, Rajan, we have got a project team up and running. We have got a detailed plan over the next three to five years to really manage all of those moving parts. You want to share a little more of detail there?

Absolutely. Thanks again for the question. Just let's start talking about inventory. I think inventory management is a key area of focus from a seed productivity standpoint and we have got a lot of activity initiated as we transition platform. We start really with no carryover from Enlist into our germplasm. So we have got a very robust plan. So you should not expect increase in inventory. We will continue to work with getting the best Pioneer germplasm with Enlist trait in this. We are already launching Enlist in the pioneer brand and with our multi-channel brands this year. So we have got a very robust inventory management plan which will ensure that the transition doesn't result in any increase in inventory. So thank you for the question.

We will go next to Jonas Oxgaard with Bernstein.

Hi. Good morning. I was hoping to talk a little bit about the value of Conkesta. What kind of premium we are hoping, market share and ramp? And also, what happens to Conkesta if buyer looses the patent dispute on Intacta they are fighting right now?

Great. Thanks Jonas. You are right. We are very excited to have recently received the China approval that I mentioned. We will have that opportunity to stack Conkesta with E3 for something, for a product in the Brazil market that we believe will be differentiated and it's again one more step towards that trait independence that we have talked about. We need still a little bit of time for that product to kind of be ready for the full launch in Brazil. One of the things we are waiting on is EU approval for the stack. We have submitted and we anticipate that sometime in 2021 or so we will get those approvals. We also have to go through the same process that we went through on Enlist around the breeding plan, accelerate the introgression of that trait into our background germplasm and that process kind of starts now. So earliest commercialization could be the latter part of 2021 and it gives us a real opportunity to drive new market share. Our share, as you know, in soybeans in Brazil is kind of in the low single digit range here today. So Rajan, anything else you would add?

Yes. I think just to add on the question, Jonas, about Intacta, we are watching that closely. But really, it comes back to a value proposition for the grower. We feel very confident about the value proposition that Conkesta will bring to the marketplace. The Brazilian farmers, historically, have been always willing to pay for the right technology which we bring there. And from a Conkesta perspective, we are very confident that we should be able to extract value for the technology that we are bringing there for them. So looking forward to a rapid ramp-up of Conkesta.

Our next question will come from Jeff Zekauskas with JPMorgan.

Thanks very much. On page four in your press release, in your crop protection area, you have good growth in your major subsegments but in your other category I think you go from $155 million in revenues to $70 million and for the year from $382 million to $253 million. What's behind that decrease? And because the decrease is so large, has it come to an end so that whatever is going on in that category will change for the better in 2020 as a base case?

Thanks, Jeff, for the question. You are right. That category covers a number of our other products in the marketplace. And as part of our portfolio work and we talk about our best-owner mindset, you see that we begin to rationalize pieces of those portfolios and some of those products would have been in there with revenue but very, very low margins or contributions to earnings. Rajan, anything else you would share about that category?

No. I think, Jim, just bidding on what you said, I think on the other category, there are products, sometimes we have third-party products, et cetera that did not necessarily fir there. So we continued to reduce our sales in some of those products, which have no impact on us. There is also some categories which is like a catch-all where you have a miscellaneous bucket as we are working through our system to see what that is. So as that category reduces, I think the key message, Jeff, back to you is that we continue to expect a rapid ramp-up of our products as they move forward. There is a 30 basis point margin expansion in crop protection and that is all a reflection of how we are managing our portfolio actively. So feel very good about the commitment we have made of 2% to 3% above-market growth, which is going to be led by rapid ramp-up of lot of new technologies that cuts across all the segments. So no concerns there.

Our next question will come from John Roberts with UBS.

Thank you. Is Asia primarily a Northern or Southern hemisphere market for you? I should know that. But I don't. I don't know whether this quarter it was down meaningfully is representative or is it seasonally low? And what's going on in there to cause that decline, especially in the crop protection chemical area?

Yes. John, thanks for the question. It primarily is the second half market for us on a calendar year basis, which we do kind of group it with the Southern hemisphere type performance. So I don't know, Tim, you want to share more specifics about what happens here?

Yes. I think Asia, we have had several years of very strong growth and we actually have business that transpires over the course of the year. So it's hard to call it first or second, it really is a seasonal business and you have multiple seasons in different markets. So we actually do play in all parts. And on the year, we did see overall growth in the region and growth in both seed and crop protection and continued strength in particular in the insecticide segment. So I think what hit us as we came through the year and maybe why we took a little bit off the top was, when you talk about extended impact of the drought in Australia that is significant. And we also had periodic droughts over the course of the seasons, especially in the Albion countries. So think Indonesia especially and at one point, we did have a typhoon in the Philippines and all those things do impact the seasonal business that we have. So it's not quite as I guess is tied to the calendar as we would have in other markets. So it does play a little bit Northern hemisphere, a little bit Southern hemisphere but throughout the year. So again I think the highlight is, we grew nicely in both seed and crop protection, 3% overall in crop protection for the year and again double-digit growth in our insecticide portfolio, which again is capped by our ability to supply those markets. So we are very satisfied and we believe we did outperform the market again and we continue to have strong expectations for our business in Asia.

Yes. A number of our new products that we are launching have real utility as well as you have heard us talk about the insecticide expansions that we are making to continue to supply the Spinosyns product supply constraints that will really benefit Asia Pacific as we go forward as well.

Our next question will come from P.J. Juvekar with Citi.

Yes. Good morning.

Good morning P.J.

Yes. Hi. Can you hear me?

Yes.

Yes. Thank you. So Jim, you have a lot of levers to pull in 2020. You have new product like Enlist E3 that would be on 20% of acres, you have Conkesta, Qrome, you have new products in crop protection, you have cost cutting, you are addressing new markets. So when you look at all these levers, what are the most important levers for you in 2020 that could create potential upside? And then what are the big risks for you in 2020? Thank you.

Great. P.J., thanks for the question. When I think about the key other drivers of additional upsides to the plan that we have laid out, I think one of the areas would be pricing. We are basically priced through the first half with offerings that we have out there in the market. So there will be small opportunities here and there to make adjustments. But that second half pricing opportunity is ahead of us. And as markets unfold, we will certainly have a very, very close eye on that. I think the second upside area revolves around route-to-market changes that we have been making. In the U.S., the multi-channel and multi-brand opportunities that you have there. And then in places like Eastern Europe where we launched a more direct approach and continuing to penetrate in Latin America, that's about driving share and margin going forward. And then finally, I think about the cost category. We are clearly laser focused on continuing to drive productivity. We are seeing that show up. You see a good evidence of that in the fourth quarter. We are carrying great momentum going into the year. So we have a base plan. But with our execute to win initiative, we got 20,000 employees now all around the world thinking like owners and bringing up ideas every single day about how to continue to improve productivity. So this would be another area where we are going to keep driving.

We will go next to Duffy Fischer with Barclays.

Yes. Good morning. Three questions around Enlist. So Tim talked about your big Roundup Ready 2 Xtend customer cutting price. Does Enlist have to match that in the market? Or can it move to more of a premium? Second, Greg talked about royalty cost increasing as your ramping the Enlist trait. I think that surprises most people because you own the Enlist trait. So I think most would have thought that was kind of a free on board. So can you talk about the mechanics of why the COGS increases as that goes up? And then your bump from 10% to 20% of Enlist this year, how much of that was driven by your own seed and how much of that was driven by third parties?

Great. Duffy, thanks for the question. And you are right. There are a lot of moving parts with Enlist. We are excited about the announcement and the ability now to talk about the accelerated pace that we promised you we will be back to share with you as we close out the year. Why don't I turn it to Tim and have you talk about the first and the third one, pricing and the improvement from 10% to 20%?

Yes. Hi. Good morning Duffy. When I think about Enlist pricing today, I mean, you have got to think this is really our first year of commercial sales. And so there is tremendous amount of energy and I don't necessarily see Enlist E3 competing head-to-head with Xtend at this point in time. There is significant presence in the market from multiple brands selling the product as well as Corteva's brand. And I would say, what you are seeing is some companies are taking a very, an approach around penetration pricing, really trying to go out there and drive trial and utilization from farmers. And as you can see, it's had a tremendous impact. So again, I don't see necessarily going head-to-head with the Xtend technology in the market per se, more about farmers excited to have a choice, a new option in the marketplace and using those market dynamics where penetration pricing is really helping to create some strong momentum for adoption. When you think about the move from 10% to 20%, I think it's a combination of both. We are getting very strong uptake on E3, particularly on our multi-channel business. And obviously the many other companies who are in the marketplace today are seeing that same level of adoption. So I think it's broad and really reflects positive energy from farmers, from retail channel and other seed companies for having that new choice, that new option available. So it's great to see that farmer interest really translate into orders at this point.

And then the other part of your question, Duffy, is yes, there are some short-term financial implications of the decision that we made, especially in the royalty area. We fully have dialed those in. So the plan that we have, the guidance we have, Greg, you want to share a little more detail around that?

Absolutely. Let me clarify a little bit. The royalty that's increasing is on the Xtend portfolio. So our 2020 royalty costs are expected to increase, as we mentioned, by $50 million. And this change, by the way, does not have a cash impact. This is related to a change for the rate at which we recognize per unit royalty expense for Roundup Ready 2 Xtend and this will require that we record per unit royalty expense associated with the Roundup Ready 2 Xtend at the current rate rather than the average royalty rate over the life of the established contract since inception. So there is no impact to cash, as I mentioned, associated with this change. I will also mention that there is a non-operating accelerated amortization expense associated with the prepaid royalty that we have recorded on our balance sheet.

We will go next to Don Carson with Susquehanna.

Yes. A question on the current EBITDA walk versus what you have talked about in the past. So as I see it, you are about $180 million lower on your EBITDA outlook. Is that all due to headwinds? I mean in the past you used talk about perhaps about $100 million of headwinds in 2020. Now as I add it up, you get about $250 million. And specifically, you used to talk about a $250 million benefit in 2020 from normalized North American market conditions. Is that still part of your assumption? And you also used to have a $100 million benefit from new product growth. Is that now higher given some of these accelerations you are making?

Hi Don. Thanks for the question. As we built this 2020 plan, clearly it's aligned with our mid-term guidance that we have been out talking about. So this plan is absolutely aligned with those of that mid-term. We put a plan together where we de-risk. We have got a lot of confidence in this plan and we have got an opportunity, as you have heard a minute ago, to drive for some upside going forward. So I am confident that we have appropriately considered the uncertainties as we see them today. And then, the plan is consistent with some of the items that we have previously shared before. And the two broad categories of those, a number of growth items, the North America recovery is in there, the synergies and productivity are in there and the new product portfolio driving forward. So all very consistent with what we have shared in the past. We had anticipate some headwinds. Many of these very consistent with what we have also mentioned around soybean prices, higher COGS, some investments that we are making to drive growth. So, I don't know, Greg, do you want to maybe share a little more detail around those categories?

Yes, Don, thank you for the question and I will just walk you through the numbers very quickly here. So you mentioned the North America market returned $250 million due to normalized whether. We are positioned and ready to realize this effective rebound of the market year-over-year. New products that we are anticipating, $100 million of margin improvement as we bring new technology to market. We talked about synergies and productivity. We are prepared and executing on projects to deliver that $230 million that we talked about. We also mentioned headwinds of about $100 million. Those do exist and they are primarily related to lower yield than anticipated and increased commodity prices. That's all confirming information that we previously provided. So what's new? A couple of things here. We talked about our global corn price increasing. We have got $100 million of global corn price that rebounded here. This is proof of the value of the innovation that we are delivering to the market and our ability to price for that value. We did talk about a $50 million on potential reduction in soybean price. That's dialed in as well. We also mentioned $50 million cost for implementing our ERP system and then the royalty element that we just discussed of another $50 million. Additionally, we had some portfolio actions in the fourth quarter as we executed our best-owner strategy. Those elements are not recurring. So we are not going to see those come back. And then finally, as Jim mentioned, investments in R&D and selling to bring our products to market.

Thank you. And our last question will come from Adam Samuelson with Goldman Sachs.

Hello. Can you hear me?

Yes. We hear you now, Adam.

Thank you. So all the grounds have been covered here this morning. I was hoping maybe just to recap the 100 basis points of anticipated margin improvement in 2020. Can you walk through the key components of the pluses and minuses there? And kind of where opportunities may exist, where risks exist, in your mind, around that anticipated margin improvement? Thank you.

Great. Thanks, Adam. Clearly, a lot of that margin improvement is consistent with the new product launches that we have been driving, bringing new technologies. So that would be one aspect. Second, you hear the strength of our corn portfolio globally and the pricing that we are really driving in that portfolio and that's having a nice lift coupled with the new products. Qrome was the example that Tim mentioned earlier. And then finally, we continue to drive productivity. We have got the productivity related to the merger, the synergies that continue to flow through in finishing those out of the next two years and then the new productivity we are guiding as a result of our execute to win work. So those are probably the three major drivers.

Okay. I think that's going to conclude actually the Q&A for the call today. We really appreciate everyone who joined the call. Thank you so much.

That does conclude today's conference. Thank you all for your participation. You may now disconnect.