Download - monsanto 02-20-07
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CARL CASALEEXECUTIVE VICE PRESIDENT, NORTH AMERICA COMMERCIAL
MORGAN STANLEY,BASIC MATERIALS CONFERENCE
FEBRUARY 20, 2007
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Forward-Looking Statements
Certain statements contained in this presentation are "forward-looking statements," such as statements concerning the company's anticipated financial results, current and future product performance, regulatory approvals, business and financial plans and other non-historical facts. These statements are based on current expectations and currently available information. However, since these statements are based on factors that involve risks and uncertainties, the company's actual performance and results may differ materially from those described or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, among others: continued competition in seeds, traits and agricultural chemicals; the company's exposure to various contingencies, including those related to intellectual property protection, regulatory compliance and the speed with which approvals are received, and public acceptance of biotechnology products; the success of the company's research and development activities; the outcomes of major lawsuits, including proceedings related to Solutia Inc.; developments related to foreign currencies and economies; successful completion and operation of recent and proposed acquisitions, including Delta and Pine Land Company; fluctuations in commodity prices; compliance with regulations affecting our manufacturing; the accuracy of the company's estimates related to distribution inventory levels; the company's ability to fund its short-term financing needs and to obtain payment for the products that it sells; the effect of weather conditions, natural disasters and accidents on the agriculture business or the company's facilities; and other risks and factors detailed in the company's most recent periodic report to the SEC. Undue reliance should not be placed on these forward-looking statements, which are current only as of the date of this presentation. The company disclaims any current intention or obligation to update any forward-looking statements or any of the factors that may affect actual results.
TrademarksTrademarks owned by Monsanto Company and its wholly-owned subsidiaries are italicized in this presentation. Mavera™ is a trademark of Renessen. All other trademarks are the property of their respective owners.
© 2007 Monsanto Company
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Non-GAAP Financial Information
This presentation may use the non-GAAP financial measures of “free cash flow,” and earnings per share (EPS) on an ongoing basis. We define free cash flow as the total of cash flows from operating activities and investing activities. A non-GAAP EPS financial measure, which we refer to as on-going EPS, excludes certain after-tax items that we do not consider part of ongoing operations, which are identified in the reconciliation. ROC means net income (without the effect of certain items) exclusive of after-tax interest expenses, divided by the average of the beginning year and ending year net capital employed, as defined in the reconciliation. Our presentation of non-GAAP financial measures is intended to supplement investors’ understanding of our operating performance. These non-GAAP financial measures are not intended to replace net income (loss), cash flows, financial position, or comprehensive income (loss), as determined in accordance with accounting principles generally accepted in the United States. Furthermore, these non-GAAP financial measures may not be comparable to similar measures used by other companies. The non-GAAP financial measures used in this presentation are reconciled to the most directly comparable financial measures calculated and presented in accordance with GAAP, which can be found at the end of this presentation.
FISCAL YEAR:References to year, or to fiscal year, are on a fiscal year basis and refer to the 12-month period ending August 31.
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Building From Established Platform, Monsanto Has a Window of Opportunity to Extend Our Leadership
OVERVIEW
R&D LEADERSHIP
SEED & TRAIT PLATFORM
SEEDS & TRAITSIn the 10 years since the introduction of
the first biotech trait, Monsanto has invested >$5B in seeds-and-traits R&D
TRAITSMonsanto developed and commercialized the first
broad-acre biotech traits; First to launch stacked
traits and second-generation traits
SEEDSGlobal germplasm library
unmatched in scale – with 36 integrated breeding
programs from 12 countries for corn and soy
and the world’s leading vegetable seed company
FINANCIAL PERFORMANCEHigh-margin technology business that generates sustainable free cash flow
COMMERCIAL COORDINATIONRoundup, world’s best-selling herbicide brand, uniquely complements seed-and-trait platform
COMMERCIAL PLATFORMIntegrated platform with commonality of technology and commercial approach among crop platforms
BREEDING>100 breeding research
centers worldwide, underpinning companywide
focus around molecular breeding
CHANNELS TO MARKETIndustry’s only company to widely employ dual market approach of branded and licensed seed and trait sales
STRATEGIC PERFORMANCE
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Monsanto’s Success Is Rooted in Seeds and Traits, Creating Platform for Future Growth
OVERVIEW
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
2003 2004 2005 2006 2007F
SEEDS & GENOMICSCAGR 2003-2006: 32%
AGRICULTURAL PRODUCTIVITY
CAGR 2003-2006: (3)%
Higher margins in the seed-and-trait business focus Monsanto’s opportunity on accelerating gross profit growth
FOCUS: SEEDS & GENOMICS GROSS PROFIT
The EPS performance of the overall business reflects the growth trajectory of the seeds-and-traits business, Monsanto’s leadership in the industry, and the commercial potential of our proven R&D pipeline
FOCUS: ONGOING EPS PERFORMANCE
AN
NU
AL
GR
OS
S P
RO
FIT
($
IN
MIL
LIO
NS
)
$1.04
$0.80$0.72
$1.31
$1.50-$1.57
$0.60
$0.80
$1.00
$1.20
$1.40
$1.60
2003 2004 2005 2006 2007F11% GROWTH 30% GROWTH 26% GROWTH
2007 EPS GUIDANCE: 15-20% GROWTH
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OVERVIEW
“Rising Tide Lifts All Boats” Across Corn Industry, But Performance Will Still Determine Long-Term Winners
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1997 1998 1999 2000 2001 2002 2003 2004 2005 200680
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FOCUS: HISTORICAL U.S. PLANTED ACRES
Average swing of corn acres over the last decade is roughly 1 percent; Last significant acre swing occurred in mid-1980s
2007 could represent the largest acreage swing in decades because of the new dynamic of ethanol on top of the established export demand
WHEAT SOY CORN TOTAL PLANTED ACRES
AC
RE
S (
IN M
ILLI
ON
S)
TO
TA
L PLA
NT
ED
A
CR
ES
(IN M
ILLION
S)
CORN
SOY
WHEAT
TOTAL PLANTED ACRESOF CORN, WHEAT, SOY
With yield focus, stacks – and triples especially – are the trait package of choice
TRAIT AVAILABILITY
Ultimate yield potential is reflected in the core seed
GERMPLASM PERFORMANCE
Additive
Favors corn, but essentially indifferent as cotton acres are highly penetrated with higher-priced stacked traits
Favors corn, but a trade-off because of high Roundup Ready penetration
WHEAT OR OTHER
COTTON
SOYBEANS
Farmers want to maximize productivity in high-return environment – creating opportunity for seed companies who deliver total performance Key Factors:
Growth from performance
Additional acres provide a “rising tide” that benefits most ag companiesDepending on source of incremental acre, there can be a trade-off in profit opportunity. For example, within Monsanto that trade-off is:
Growth from additional acres
GROWTH AVENUES IN A STRONG CORN MARKET
COTTON
COTTON
Source: USDA, FAPRI and Monsanto estimates
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Farmers Buy Yield; Our Business Strategy Is Oriented Around Meeting That Customer Need
OVERVIEW
R&D APPROACH
FAR
M A
PP
RO
AC
H
=
X
SEED• Starting point of all
agriculture; farmers maximize genetics in seed for yield
• 60% of farmers select seed first, thendecide on biotech traits
TECHNOLOGY• Technology is used to
protect and maximize yield potential of seed
GENETIC POTENTIALInherent yield possible from the seed
YIELDFarmer’s Purchase
Decision = XPERCENT OF GENETIC
GAIN PRESERVEDAmount of yield potential
protected
• Germplasm library assembled from 36 programs in 12 countries
• >100 breeding research centers worldwide
• >2,000 genetic markers used by breeders for corn today
• 50% of breeding population comes from intra-company, inter-country crosses
• Molecular breeding improves genetic potential by 2X versus conventional breeding
GERMPLASM BREEDING
• Monsanto is only company to develop and commercialize complete above-ground, below-ground insect-control and weed-control traits
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First Decision Farmers Make Is Seed Germplasm; More and More Farmers Have Been Choosing Monsanto Seed
• In 2007, DEKALB and Asgrow brands expected to gain at the upper end of 1 - 2 share points
• ASI companies expected to gain up to 0.5 share points through organic growth
OUTLOOK:
• In 2006, Monsanto’s DEKALB and Asgrow brands grew by 3 market share points
• Over 5 years, comparable market share gain was 9 points
SITUATION:
U.S. Corn
In 2007, national brands expected to grow at upper end of 1 – 2 share points
U.S. CORN MARKET SHARE EVOLUTIONMONSANTO BRANDS AND LICENSEES
0%
10%
20%
30%
40%
50%
60%
2001 2002 2003 2004 2005 2007F2006
In 2006, the addition of 1 market share point in a Monsanto national brand translated into an average incremental value of approximately $10M-$15M in gross profit opportunity for Monsanto for the seed alone
ACREAGE EXPANSION
ASGROW AND DEKALB BRANDS
AMERICAN SEEDS, INC. BRANDS
LICENSEES’ BRANDS
U.S. CORN
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2
U.S. Corn
• Gains in the 110-day market are most significant, both from a breeding perspective and a sales growth perspective
OUTLOOK:
• In 2006, yield data across all three channels and essentially across all maturity zones indicates a yield advantage over best-in-class competitors1
SITUATION:
U.S. CORN
0.00
2.00
4.00
6.00
8.00
10.00
12.00
95 100 105 110 115
2006-TO-2007 CHANGE IN ORDERS BY MATURITY ZONE IN EACH CHANNEL
NATIONAL BRANDS
REGIONAL BRANDS
LICENSED BRANDS
BU
SH
ELS
PE
R A
CR
E
2006 TESTING: YIELD DIFFERENCE VERSUS COMPETITIVE CHECKS BY CHANNEL1
RELATIVE MATURITIES (DAYS)
110
Decreased ordersFlat ordersIncreased orders
Breeding Strength Translates to Commercial Growth Opportunity
2. In the 100 day maturity zone, ASI’sbushels per acre are statistically indifferent when compared to best competitive checks
1. For purposes of this testing, the competitive checks excluded any Monsanto or Monsanto licensed germplasm
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With Higher Demand for Stacks, the “Average” DEKALB Acre Now Contains More Than Two Traits
• In 2007, the trait intensity for DEKALB and Asgrow will surpass 2.0 for the first time – reflecting that the average corn acre now contains more than 2 biotech traits
• With an infusion of technology, ASI’s trait penetration levels are closing in on DEKALBand Asgrow
• In our DEKALB and Asgrow brands, our triple-stacks are sold out
OUTLOOK:
• With increased stacking, there is a positive mix effect across the portfolio
SITUATION:
U.S. Corn
20%
15%
7%
2006
TRIPLE STACKED PENETRATION
>35%
>30%
10 - 15%
2007F
STACKED PENETRATIONTRAIT PENETRATION
70 - 75%
65 - 70%
55 - 60%
2007F
69%
55%
43%
2006
90 - 95%
80 - 85%
60 - 65%
2007F
90%
75%
55%
2006
NATIONAL BRANDS
REGIONAL BRANDS
LICENSED BRANDS
U.S. CORN
0
0.5
1
1.5
2
2.5
2003 2004 2005 2006 2007F
TRAIT PENETRATION TRENDSACROSS KEY COMMERCIAL CHANNELS
TR
AIT
IN
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SIT
Y I
ND
EX
(A
VE
RA
GE
NU
MB
ER
OF
TR
AIT
S P
ER
T
RA
IT A
CR
E)
DEKALB/ASGROW2007F TRAIT INTENSITY: > 2.0
2007F TOTAL MARKET TRAIT INTENSITY LESS BRANDED: 1.7
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0%0%0%PERCENT PENETRATED
6M
ARGENTINA
30M80MAVAILABLE MARKET
BRAZILU.S.KEY MARKET ACRES
Drought-Tolerant CornP R O J E C T
VALUE CONSIDERATIONS:
PROJECT CONCEPT:
First-generation drought tolerance is targeted to minimize uncertainty in farming by buffering against the effects of water limitation, primarily in areas of annual water stress2006 PERFORMANCE UPDATE:
$10 - $30/acreRETAIL VALUE/ACRE:
Drought-Tolerant Corn
2006 STATUS:
VALUE CATEGORIES:
Phase 2
• Farmers value water-use in “acre-inches of water” needed to support yield potential – farmers need 18-20 inches of moisture from natural or irrigated sources during growing season
• Value of trait is in better yields under moisture stressed conditions: Varies by region
R&D PipelineSEGMENTED VALUE OPPORTUNITY ACROSS MARKETS: U.S. EXAMPLE
STABILITYWESTERN DRYLANDIRRIGATED
Value is in improved yields when moisture is less than optimal
Value is in improved yields annually, by improving water-use efficiency
Value is in replacing irrigation, reducing the variable costs of irrigation
Non-irrigatedNon-irrigatedIrrigated
17-19” typical precipitation in growing season
14-18” typical precipitation in growing season
14-18” typical precipitation in growing season
50-60M acres10-12M acres8-12M acres
High annual precipitation
Low annual precipitation
Source: Spatial Climate Analysis Service, Oregon State University
U.S. CORN
Multi-Generational Drought-Tolerant Corn Creates Value Across Multiple Market Segments
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0%0%0%PERCENT PENETRATED
24M
EUROPE
30M80MAVAILABLE MARKET
BRAZILU.S.KEY MARKET ACRES
Nitrogen Utilization Corn Change the Dynamics of Corn Production for Farmers
U.S. CORN
PROJECT CONCEPT:
Targets ways that corn plants can use nitrogen more efficiently, exploring the potential to boost yield under normal nitrogen conditions or stabilize yield in low nitrogen environments2006 PERFORMANCE UPDATE:
$10 - $30/acreRETAIL VALUE/ACRE:
Nitrogen Utilization Corn
2006 STATUS:
VALUE CATEGORIES:
Phase 1
• Second year proof-of-concept testing confirmed 2005 lead genes across multiple locations and nitrogen rates and added new gene candidates for further testing
R&D Pipeline
KE
Y R
ES
ULT
S
2006 TESTING: 2006 FIELD RESULTS CONFIRM CONTINUED PERFORMANCE OF LEADS IDENTIFIED IN 2005
Nitrogen Utilization Corn
Reading right to left, what scientists will look for to establish proof of concept is when nitrogen application is decreased, the total yield per acre remains stable. In 2006 data, the 2 events show no yield drop off as the nitrogen application levels decrease from 180 lbs/ac to 40 lbs/ac
140
145
150
155
160
165
170
175
0
EVENT 1
EVENT 2
CONTROL
LEAD NITROGEN UTILIZATION GENE(ACROSS 3 LOCATIONS: ILLINOIS AND IOWA)
YIE
LD P
ER
AC
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Reduction in Applied Nitrogen
40 80 180
NITROGEN INPUT: LBS/ACRE
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Renessen Corn Processing System May Rebalance Ethanol Energy Equation
U.S. CORN
#2 YELLOW CORN ELEVATOR HAMMER MILL FERMENTATION DISTILLATION ETHANOL
FRACTIONATION
HIGH OIL FRACTION
OILEXTRACTION
HIGHLY FERMENTABLE
FRACTION
CORN OIL FOR FOOD OR
BIODIESEL
HIGH-VALUE SWINE AND
POULTRY FEED
HIGH-PROTEIN, LOW-OIL DDG
DRYING
RENESSEN FRACTIONATION AND EXTRACTION PROCESS
Bolts on to existing ethanol plantsCreates 4 additional value streams
VALUE STREAMS
RENESSEN PROCESS STEPS
CONVENTIONAL ETHANOL PROCESS
RENESSEN OPPORTUNITY
As more plants come on line following the ramp-up phase, ethanol plant profitability will revolve around efficiency and value streams created. Renessen’s process provides a bolt-on addition that makes ethanol plants more efficient and more profitable.
PLATFORM CONCEPT:
Renessen’s technology seeks to utilize the components of corn more effectively to generate higher value products2007 UPDATE:
Renessen Corn Processing Technology
• Pilot plant construction complete
• Integrated fractionation and extraction testing to begin by the end of February
• High value feed trials to begin with swine in March; testing to continue throughout year
• High value DDG trials for cattle to take place during year
R&D Pipeline
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Growth in Demand for Feed, Food and Fuel Will Create New Specialty Opportunities for Soybeans in U.S.
Source: USDA, FAPRI and Monsanto estimates
U.S. SOYBEANS
U.S. VERSUS SOUTH AMERICAN SOYBEAN PLANTED ACREAGE
SOUTH AMERICAN PLANTED ACRES
U.S. PLANTED ACRES
• Domestic demand for feed, food and fuel products will remain strong creating opportunity for specialty markets in the U.S
• With acres trending lower, productivity is key and will be highly dependent on technology and germplasm
OUTLOOK:
• U.S. soybean acreage is trending flat to down because of favorable corn economics
• South American soybean acreage is expected to grow to support increasing global demand for protein especially from China
SITUATION:
U.S. Soybeans
0
20
40
60
80
100
120
2004 2005 2006 2007F 2008F 2009F 2010F
U.S. PLANTED ACRES
SOUTH AMERICAN PLANTED ACRES
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Soybean Breeding
Molecular Breeding Increasing Performance Benefit in Soybeans Versus Competitors
PLATFORM CONCEPT:
Monsanto is using the most advanced tools of genomics, molecular markers and IT resources to more efficiently select for the best base germplasm for soybeans2006 PERFORMANCE UPDATE:
Soybean Breeding
• Yield data from 2006 indicates continued yield advantage for national brands versus best-in-class competitors
R&D Pipeline
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60 COMPETITORS
ASGROW / DEKALB
BU
SH
ELS
/AC
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SOYBEAN BREEDING: 2006 U.S. COMPETITIVE SOYBEAN YIELD
RELATIVE MATURITIES
3 51 0 2 4
U.S. SOYBEANS
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0%0%0%PERCENT PENETRATED
35M
ARGENTINA
60M70MAVAILABLE MARKET
BRAZILU.S.KEY MARKET ACRES
Roundup RReady2Yield Soybeans Advance to Phase 4, Beginning Pre-Launch Activities
Roundup RReady2YieldSoybeansP R O J E C T
VALUE CONSIDERATIONS:
PROJECT CONCEPT:
Second-generation of Monsanto’s popular herbicide-tolerant platform in soybeans that will provide farmers with soybeans that have enhanced yield, with a target of up to 5 bushel-per-acre yield increase over comparable Roundup Ready soybeans
2006 PERFORMANCE UPDATE:
$10 - $30/acreRETAIL VALUE/ACRE:
Roundup RReady2Yield Soybeans
2006 STATUS:
VALUE CATEGORIES:
Phase 4
• Value is additive with target of up to 5 bushel-per-acre yield improvement over comparable Roundup Ready soybeans
R&D Pipeline
KE
Y R
ES
ULT
S
2006 TESTING: RELATIVE PERFORMANCE OF ROUNDUP READY AND ROUNDUP RREADY2YIELD EXPERIMENTAL LINES
2006 breeding trials compared Roundup RReady2Yieldexperimental lines with Roundup Ready experimental lines that were in the same stage of development. The Roundup RReady2Yield lines averaged 3 to 5 bushels per acre higher than Roundup Ready experimental lines – shifting the entire yield curve positively and providing further validation for the product concept target of up to a 5 bushel-per-acre yield increase
YIELD DIFFERENCE (BU/AC)
-10 -5 0 5 10 15
ROUNDUP READYEXPERIMENTAL
LINES
ROUNDUP RREADY2YIELDEXPERIMENTAL LINES
PE
RC
EN
T O
F P
OP
ULA
TIO
N
50
40
30
20
10
U.S. SOYBEANS
17
0%PERCENT PENETRATED
12-15M
U.S.
AVAILABLE MARKET
KEY MARKET ACRES
Vistive III Soybeans Continue To Meet or Exceed Commercial Targets
P R O J E C T
VALUE CONSIDERATIONS:
PROJECT CONCEPT:
Combining both breeding and biotechnology, Vistive III is designed to lower linolenic and saturate content while boosting oleic content for a profile similar to olive oil2006 PERFORMANCE UPDATE:
$10 - $30/acreRETAIL VALUE/ACRE:
Vistive III Soybeans
2006 STATUS:
VALUE CATEGORIES:
Phase 2
• Approximately 40M acres of U.S. soybean crop is crushed for oil; Vistive III is optimal for Non-hydrogenated and Hydrogenated-Frying segments (see table at right)
• Vistive III has replacement value; To be priced at a premium to conventional soybean oil
• Market opportunity assumes competition from other sources for different needs of different food applications
R&D Pipeline
Vistive III Soybeans
U.S. SOYBEANS
IMPROVING THE NUTRITIONAL PROFILE OF SOYBEAN OIL
LINOLENIC18:3
LINOLEIC18:2
OLEIC18:1
SATS18:0 / 16:0
Major market segments for U.S. soybean oilHYDROGENATED-
BAKINGHYDROGENATED-
FRYINGNON-
HYDROGENATED
Uses 25% of total crushing (~10M acres)
Uses 25% of total crushing (~10M acres)
Uses 50% of total crushing (~20M acres)
For various baking applications
For various frying applications
For salad oils, household use
Source: Soyatech, USDA
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Profitability in Cotton Favors Farmers Who Adopt Best Technologies
Source: University Studies, USDA and Monsanto estimates
U.S. COTTON
• Monsanto’s second generation traits including Bollgard II and Roundup Ready Flex should help cotton farmers improve profitability
OUTLOOK:
• Growers will grow the most profitable crops
SITUATION:
U.S. Cotton
0
100
200
300
400
500
600
COTTON CORN SOY WHEATCOSTRETAIL VALUE
DO
LLA
RS
/ A
CR
E
GROWER PROFITABILITYESTIMATE BASED ON 2006 YIELDS AND INPUT COSTS AND 2007
COMMODITY PRICES
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Upgrade to Second-Generation Cotton Traits Flourishes, Highlighted by 2007 Roundup Ready Flex Growth
U.S. COTTON
PENETRATION RATE OF SECOND-GENERATION TRAITSPENETRATION TREND OF COTTON TRAITS AS
A PERCENT OF ANNUAL PLANTED ACRES1
1. Percent of annual planted acres reflects the ratio of number of actual trait acres planted to total planted acres in the identified year for the specified geography
Bollgard II
Roundup Ready Flex
Bollgard II
Roundup Ready Flex
0% 5% 10% 15% 20% 25% 30%
2007 FORECAST
2006 RESULTS
Even on potentially lower total planted acres, Roundup Ready Flex penetration rate should double in 2007 to >25% of total cotton crop
ROUNDUP READY FLEX
• Transition to second-generation traits continues in 2007
• Roundup Ready Flex was planted on ~14% of planted acres in 2005 – that should double in 2007
OUTLOOK:
• Cotton trait platform is the first to move forward on complete replacement of first-generation traits with second-generation upgrades
• Roundup Ready Flex cotton launched in the U.S. in 2006; Launched in Australia for FY2007 planting
SITUATION:
U.S. Cotton
25-30%
25-30%
17%
14%
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Upgrade to Double-Double Stacks in Cotton Significantly Enhances Value Versus Seed Alone
U.S. COTTON
• From the base of a single trait, move to second-generation stack – ‘double-double’ – can increase retail value by 50 percent
OUTLOOK:
• Cotton trait platform is first to move forward on complete replacement of first-generation traits with second-generation upgrades
• Roundup Ready Flex cotton launched in the U.S. in 2006; Launched in Australia for FY2007 planting
SITUATION:
U.S. Cotton
INCREASED U.S. COTTON TRAIT RETAIL VALUEEXAMPLE: VALUE PROGRESSION OF COTTON TRAITS
IN NORTH DELTA REGION OF U.S.
0
0.5
1
1.5
2
SEED ONLY FIRST-GEN SINGLE FIRST-GENSTACKED
DOUBLE-DOUBLE
Each trait in a stacked combination adds functionality and value for the farmer. Second-generation stacks further enhance that added performance
ADDITIVE VALUE IN STACKS
1.001.17
1.50T
RA
IT R
ET
AIL
VA
LUE
PE
R A
CR
E(I
ND
EX
ED
)
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All Six Growth Drivers Are On Track in 2007, Setting Stage for Continued Growth Through End of Decade
SUMMARY
44%
46%
48%
50%
52%
54%
CURRENT LEVEL
GROSS MARGIN ‘PULL’
2003 2004 2005 2006 2007F 2008F 2009F 2010F• Emphasis on “HIT” projectsR&D pipeline
• Achieve 10-12.5 cents EPS contributionSeminis
• Complete Delta & Pine Land acquisition
• Continue penetration of second-generation stacked traits in U.S.
Cotton platform
• Achieve 2.5-5 cents EPS for Roundup Ready soybeans in Brazil
Global biotech traits
• Grow market share in key international market
International corn
• Drive trait penetration, especially triple-stacks
• Seed market share growth in U.S. national and ASI brands
U.S. corn
FY2007 PRIORITIESFACTOR
MONSANTO’S OPPORTUNITY
FOCUS: GROSS PROFIT AS A PERCENT OF SALES
22
Reconciliation of Non-GAAP Financial Measures
Reconciliation of Free Cash Flow
N/AEffect of Exchange Rate Changes on Cash and Cash Equivalents
N/A
N/A
$875 - $950
(500)
$1,375 - $1,450
Fiscal Year2007
Target
Net Increase (Decrease) in Cash and Cash Equivalents
Net Cash Provided (Required) by Financing Activities
Free Cash Flow
Net Cash Provided (Required) by Investing Activities
Net Cash Provided (Required) by Operations
$ Millions