Monsanto 8-K Financial statements and exhibits

Key Financial Data — Crop Year Basis
Dollars in millions, except per share amounts
Unaudited

		FY03			FY03			FY03			FY03			FY02			FY01
		9 months			3rd Qtr			2nd Qtr			1st Qtr			Full Year			Full Year
		9/1/02 - 5/31/03			3/1/03 - 5/31/03			12/1/02 - 2/28/03			9/1/02 - 11/30/02			9/1/01 - 8/31/02			9/1/00 - 8/31/01
Financial Summary
Net Sales		$	3,629		$	1,470		$	1,301		$	858		$	4,940		$	5,333
Net Income (Loss)			256			174			100			(18	)		(1,756	)		300
Diluted Earnings (Loss) per Share		$	0.98		$	0.67		$	0.38		$	(0.07	)	$	(6.67	)	$	1.15
Sales by Segment Summary
Total seeds and genomics		$	1,647		$	615		$	655		$	377		$	1,560		$	1,504
Roundup and other glyphosate-based agricultural herbicides			1,096			463			373			260			2,107			2,507
All other agricultural productivity products			886			392			273			221			1,273			1,322
Total agricultural productivity			1,982			855			646			481			3,380			3,829
Total Net Sales		$	3,629		$	1,470		$	1,301		$	858		$	4,940		$	5,333
Reconciliation of Earnings Before Interest and Taxes (EBIT)
	Seed and Genomics Segment EBIT	$	328		$	139		$	146		$	43		$	(302	)	$	(423	)
	Agricultural Productivity Segment EBIT		137			137			55			(55	)		439			977
	Total Company EBIT		465			276			201			(12	)		137			554
	Net Interest Expense		52			18			19			15			54			67
	Income Tax Expense (Benefit)		145			84			70			(9	)		17			187
	Income (Loss) Before Cumulative Effect of Accounting Change	$	268		$	174		$	112		$	(18	)	$	66		$	300
Reconciliation of Free Cash Flow
Net Cash Provided (Required) by Operations		$	551		$	(249	)	$	71		$	729		$	855		$	740
Net Cash Provided (Required) by Investing Activities			(191	)		195			(318	)		(68	)		(274	)		(665	)
Free Cash Flow *		$	360		$	(54	)	$	(247	)	$	661		$	581		$	75

*Sum of cash flows from operations and investing activities

Page 1

Key Financial Data — Crop Year Basis
Dollars in millions, except per share amounts
Unaudited

			FY03		FY03		FY03		FY03		FY02		FY01
			9 months		3rd Qtr		2nd Qtr		1st Qtr		Full Year		Full Year
			9/1/02 - 5/31/03		3/1/03 - 5/31/03		12/1/02 - 2/28/03		9/1/02 - 11/30/02		9/1/01 - 8/31/02		9/1/00 - 8/31/01
Net Sales by Geography**
	North America		$	2,306	$	984	$	840	$	482	$	3,227	$	3,318
	Latin America			570		170		190		210		757		1,017
	Europe — Africa			546		230		196		120		593		622
	Asia — Pacific			207		86		75		46		363		376
	Total Company		$	3,629	$	1,470	$	1,301	$	858	$	4,940	$	5,333
Net Trade Receivables by Geography**
United States			$	1,676	$	1,676	$	1,056	$	893	$	1,350	$	1,698
Argentina				272		272		300		290		284		380
Brazil				207		207		219		199		251		293
All Other Countries				713		713		434		396		566		619
Total Company			$	2,868	$	2,868	$	2,009	$	1,778	$	2,451	$	2,990
Gross Profit by Segment Summary
Total seeds and genomics			$	980	$	363	$	396	$	221	$	753	$	684
Roundup and other glyphosate-based agricultural herbicides				362		170		134		58		994		1,304
All other agricultural productivity products				384		193		114		77		498		579
Total agricultural productivity				746		363		248		135		1,492		1,883
	Total Gross Profit		$	1,726	$	726	$	644	$	356	$	2,245	$	2,567
Roundup Branded Sales Volume Detail (Millions of Gallons)
		United States		19		9		6		4		42		43
		Ex-United States		40		17		12		11		66		78
Total branded sales volume				59		26		18		15		108		121

									Percentage Change			Percentage Change
			Calendar Year				Calendar Year		Crop Year			Calendar Year
Roundup Branded Average Net Sales Price Per Gallon	Crop Year 2002		2002		Crop Year 2001		2001		'01-'02			'01-'02
United States	$	24	$	23	$	27	$	26		(11	%)		(12	%)
Ex-United States	$	13	$	12	$	13	$	13		0	%		(8	%)

**Attributed to relevant Monsanto legal entities. For example, a sale from the United States to a customer in Latin America is reported as a U.S. export sale.

Page 2

Income Statements — Crop Year Basis
Dollars in millions, except per share amounts
Unaudited

		FY03			FY03		FY03		FY03			FY03			FY02			FY01
		9 months			4th Qtr		3rd Qtr		2nd Qtr			1st Qtr			Full Year			Full Year
		9/1/02 - 5/31/03			6/1/03 - 8/31/03		3/1/03 - 5/31/03		12/1/02 - 2/28/03			9/1/02 - 11/30/02			9/1/01 - 8/31/02			9/1/00 - 8/31/01
Net Sales		$	3,629		$	—	$	1,470	$	1,301		$	858		$	4,940		$	5,333
Cost of Goods Sold			1,903			—		744		657			502			2,695			2,766
Gross Profit			1,726			—		726		644			356			2,245			2,567
Operating Expenses:
Selling, General and Administrative Expenses			764			—		301		244			219			1,057			1,166
Bad-Debt Expense			39			—		5		13			21			185			12
Research and Development Expenses			379			—		123		135			121			546			560
Amortization and Adjustments of Goodwill			—			—		—		—			—			41			125
Restructuring Charges — Net			39			—		—		31			8			132			111
	Total Operating Expenses		1,221			—		429		423			369			1,961			1,974
Income (Loss) from Operations			505			—		297		221			(13	)		284			593
Interest Expense — Net			52			—		18		19			15			54			67
Other Expense (Income) — Net			40			—		21		20			(1	)		147			39
Income (Loss) Before Taxes and Cumulative Effect of Acct Change			413			—		258		182			(27	)		83			487
Income Tax Expense (Benefit)			145			—		84		70			(9	)		17			187
Income (Loss) Before Cumulative Effect of Accounting Change			268			—		174		112			(18	)		66			300
Cumulative Effect of Accounting Change — Net of Tax			(12	)		—		—		(12	)		—			(1,822	)		—
Net Income (Loss)		$	256		$	—	$	174	$	100		$	(18	)	$	(1,756	)	$	300
Earnings Before Interest and Taxes (EBIT)*		$	465		$	—	$	276	$	201		$	(12	)	$	137		$	554
EPS — Basic (Net Income (Loss) before Accounting Change)		$	1.03		$	—	$	0.67	$	0.43		$	(0.07	)	$	0.25		$	1.16
EPS — Basic (Cumulative Effect of Accounting Change — Net of tax)		$	(0.05	)	$	—	$	—	$	(0.05	)	$	—		$	(7.02	)	$	—
EPS — Basic (Net Income (Loss))		$	0.98		$	—	$	0.67	$	0.38		$	(0.07	)	$	(6.77	)	$	1.16
EPS — Diluted (Net Income (Loss) before Accounting Change)		$	1.03		$	—	$	0.67	$	0.43		$	(0.07	)	$	0.25		$	1.15
EPS — Diluted (Cumulative Effect of Accounting Change — Net of tax)		$	(0.05	)	$	—	$	—	$	(0.05	)	$	—		$	(6.92	)	$	—
EPS — Diluted (Net Income (Loss))		$	0.98		$	—	$	0.67	$	0.38		$	(0.07	)	$	(6.67	)	$	1.15
Shares Outstanding:
Basic Shares			261.4			—		261.4		261.4			261.4			259.6			258.1
Diluted Shares			261.5			—		261.7		261.4			261.4			263.3			262.2

*     A reconciliation of earnings before interest and taxes (EBIT) is provided in the Key Financial Data worksheet.

Page 3

Items Included in Reported Earnings
Dollars in millions, except per share amounts
Unaudited

	FY03			FY03		FY03			FY03			FY02			FY01
	9 months			3rd Qtr		2nd Qtr			1st Qtr			Full Year			Full Year
	9/1/02 - 5/31/03			3/1/03 - 5/31/03		12/1/02 - 2/28/03			9/1/02 - 11/30/02			9/1/01 - 8/31/02			9/1/00 - 8/31/01
Items Included in Reported Earnings PRETAX
Adoption of FAS 142 (goodwill impairment)	$	—		$	—	$	—		$	—		$	(1,984	)	$	—
Adoption of FAS 143 (asset retirement obligations)		(19	)		0		(19	)		0			0			0
Argentine bad-debt reserve		0			0		0			0			(154	)		0
Japan asset sale		0			0		0			0			32			0
Net restructuring charges		(49	)		0		(35	)		(14	)		(218	)		(170	)
Items Included in Reported Earnings AFTERTAX
Adoption of FAS 142 (goodwill impairment)	$	—		$	—	$	—		$	—		$	(1,822	)	$	—
Adoption of FAS 143 (asset retirement obligations)		(12	)		0		(12	)		0			0			0
Argentine bad-debt reserve		0			0		0			0			(100	)		0
Japan asset sale		0			0		0			0			21			0
Net restructuring charges		(31	)		0		(22	)		(9	)		(142	)		(115	)
Items Included in Reported Earnings (Per Diluted Share Basis) PRETAX
Adoption of FAS 142 (goodwill impairment)	$	—		$	—	$	—		$	—		$	(7.53	)	$	—
Adoption of FAS 143 (asset retirement obligations)	$	(0.07	)	$	—	$	(0.07	)	$	—		$	—		$	—
Argentine bad-debt reserve	$	—		$	—	$	—		$	—		$	(0.59	)	$	—
Japan asset sale	$	—		$	—	$	—		$	—		$	0.12		$	—
Net restructuring charges	$	(0.19	)	$	—	$	(0.13	)	$	(0.06	)	$	(0.83	)	$	(0.65	)
Items Included in Reported Earnings (Per Diluted Share Basis) AFTERTAX
Adoption of FAS 142 (goodwill impairment)	$	—		$	—	$	—		$	—		$	(6.92	)	$	—
Adoption of FAS 143 (asset retirement obligations)	$	(0.05	)	$	—	$	(0.05	)	$	—		$	—		$	—
Argentine bad-debt reserve	$	—		$	—	$	—		$	—		$	(0.38	)	$	—
Japan asset sale	$	—		$	—	$	—		$	—		$	0.08		$	—
Net restructuring charges	$	(0.12	)	$	—	$	(0.08	)	$	(0.04	)	$	(0.54	)	$	(0.44	)

Page 4

Balance Sheets — Crop Year Basis
(Full Year for FY02 & FY03 / Quarterly for FY03)
Dollars in millions
Unaudited

											FY02			FY01
		FY03			FY03			FY03			Full Year			Full Year
		05/31/03			02/28/03			11/30/02			08/31/02			08/31/01
Assets
Current Assets:
	Cash and Cash Equivalents	$	128		$	87		$	329		$	137		$	267
	Short-Term Investments		—			250			1			1			11
	Trade Receivables — Net of allowances		2,868			2,009			1,778			2,451			2,990
	Inventories		1,365			1,369			1,374			1,284			1,325
	Other Current Assets		717			769			636			683			786
	Total Current Assets		5,078			4,484			4,118			4,556			5,379
	Property, Plant and Equipment — Net		2,328			2,312			2,348			2,416			2,596
	Goodwill — Net		782			759			748			755			2,728
	Other Intangible Assets — Net		602			623			650			672			698
	Other Assets		788			723			724			752			543
Total Assets		$	9,578		$	8,901		$	8,588		$	9,151		$	11,944
Liabilities and Shareowners’ Equity
Current Liabilities:
	Short-Term Debt	$	551		$	663		$	548		$	771		$	1,246
	Accounts Payable		313			295			315			291			304
	Accrued Liabilities		1,073			883			709			648			1,123
	Short Term Debt — Pharmacia		—			—			—			—			365
	Total Current Liabilities		1,937			1,841			1,572			1,710			3,038
	Long-Term Debt		1,110			848			920			1,148			941
	Postretirement and Other Liabilities		1,091			1,075			1,000			1,035			721
	Shareholders’ Equity		5,440			5,137			5,096			5,258			7,244
Total Liabilities and Shareowners’ Equity		$	9,578		$	8,901		$	8,588		$	9,151		$	11,944
	Debt-to-Capital Ratio		23	%		23	%		22	%		27	%		26	%

Page 5

Cash Flow Statements — Crop Year Basis
Dollars in millions, Year Ended August 31
Unaudited

	FY03			FY03			FY03			FY03			FY02			FY01
	9 Months			3rd Qtr			2nd Qtr			1st Qtr			Full Year			Full Year
	05/31/03			05/31/03			02/28/03			11/30/02			08/31/02			08/31/01
Operating Activities:
Net Income (Loss)	$	256		$	174		$	100		$	(18	)	$	(1,756	)	$	300
Adjustments to reconcile cash provided (required) by operations:
Items that did not require (provide) cash:
Pretax cumulative effect of change in accounting principle		19			—			19			—			1,984			—
Depreciation and amortization		337			113			115			109			490			539
Bad-debt expense		39			5			14			20			185			12
Noncash restructuring		(21	)		—			10			(31	)		155			59
Deferred income taxes		(58	)		(8	)		(35	)		(15	)		(170	)		9
Gain on disposal of investments and property — net		(7	)		—			(8	)		1			(62	)		—
Equity affiliate expense — net		31			10			11			10			45			41
Write-off of retired assets		18			1			14			3			11			10
Changes in assets and liabilities that provided (required) cash:
Trade receivables		(238	)		(929	)		(19	)		710			401			(136	)
Inventories		(25	)		63			19			(107	)		(7	)		(137	)
Accounts payable and accrued liabilities		163			294			(130	)		(1	)		(398	)		(82	)
Related-party transactions		11			5			(5	)		11			(90	)		152
Tax benefit on employee stock options		—			—			—			—			11			—
Deferred revenue on supply agreements		11			3			2			6			48			—
Net investment hedge proceeds (loss)		8			(13	)		2			19			—			—
Other Items		7			33			(38	)		12			8			(27	)
Net Cash Provided (Required) by Operations		551			(249	)		71			729			855			740
Cash Flows Provided (Required) by Investing Activities:
Acquisitions and investments		(301	)		(20	)		(266	)		(15	)		(98	)		(93	)
Property, plant and equipment purchases		(151	)		(36	)		(61	)		(54	)		(257	)		(409	)
Investment and property disposal proceeds		260			251			9			—			70			3
Loans with related party		1			—			—			1			11			(166	)
Net Cash Provided (Required) by Investing Activities		(191	)		195			(318	)		(68	)		(274	)		(665	)
Cash Flows Provided (Required) by Financing Activities:
Net change in short-term financing		(459	)		(90	)		56			(425	)		(1,017	)		(874	)
Loans from related party		—			—			—			—			(365	)		353
Long-term debt proceeds		265			251			2			12			850			43
Long-term debt reductions		(68	)		(32	)		(17	)		(19	)		(102	)		(99	)
Debt issuance costs		(2	)		(2	)		—			—			(10	)		—
Payments on other financing		(11	)		(1	)		(5	)		(5	)		(5	)		—
Stock option exercises		—			—			—			—			63			—
Dividend payments		(94	)		(31	)		(31	)		(32	)		(125	)		(85	)
Issuance of stock		—			—			—			—			—			723
Net transactions with Pharmacia		—			—			—			—			—			62
Net Cash Provided (Required) by Financing Activities		(369	)		95			5			(469	)		(711	)		123
Net Increase (Decrease) in Cash and Cash Equivalents		(9	)		41			(242	)		192			(130	)		198
Cash and Cash Equivalents at Beginning of Period		137			87			329			137			267			69
Cash and Cash Equivalents at End of Period	$	128		$	128		$	87		$	329		$	137		$	267
Reconciliation of Free Cash Flow
Net Cash Provided (Required) by Operations	$	551		$	(249	)	$	71		$	729		$	855		$	740
Net Cash Provided (Required) by Investing Activities		(191	)		195			(318	)		(68	)		(274	)		(665	)
Free Cash Flow *	$	360		$	(54	)	$	(247	)	$	661		$	581		$	75

*     Sum of cash flows from operations and investing activities

Page 6

1996 - 2002 Monsanto Biotechnology Trait Acreage — Crop Year Basis

Biotechnology Trait Acreage (in millions of acres)	2002		2001		2000		1999		1998		1997		1996
U.S. Roundup Ready soybean trait		60.0		54.8		45.0		40.5		29.1		7.9		1.2
Argentine Roundup Ready soybean trait		27.1		22.7		17.0		13.6		4.0		0.5		—
Roundup Ready soybean trait — other		1.0		0.6		0.6		0.4		—		—		—
Total Monsanto soybean trait		88.1		78.1		62.6		54.5		33.1		8.4		1.2
U.S. Roundup Ready corn trait		5.6		3.4		2.6		2.1		0.9		—		—
Roundup Ready corn trait — other		0.2		0.2		0.1		—		—		—		—
U.S. YieldGard corn borer traits		18.2		14.3		14.6		15.4		11.4		2.3		—
YieldGard corn borer traits — other		2.5		2.0		1.1		0.6				—		—
U.S. YieldGard rootworm corn trait		—		—		—		—		—		—		—
U.S. MON “stacked” corn traits*		2.2		1.2		0.1		—		—		—		—
MON “stacked” corn traits — other*		0.1		—		—		—		—		—		—
Total Monsanto corn traits		28.8		21.1		18.5		18.1		12.3		2.3		—
U.S. Roundup Ready cotton trait		5.2		5.1		4.6		3.8		2.1		0.6		—
Roundup Ready cotton trait — other		0.1		—		—		—		—		—		—
Chinese Bollgard cotton trait		1.9		2.3		0.3		0.3		0.2		—		—
U.S. Bollgard I and II cotton traits		0.4		0.5		1.0		2.0		2.0		2.0		1.8
Bollgard I and II cotton traits — other		0.5		0.7		0.5		0.2		0.2		0.1		0.0
U.S. MON “stacked” cotton traits*		4.8		5.6		4.0		2.4		0.7		0.1		—
MON “stacked” cotton traits — other*		0.1		—		—		—		—		—		—
Total Monsanto cotton traits		13.0		14.2		10.4		8.7		5.2		2.8		1.8
U.S. Roundup Ready canola trait		0.9		0.9		0.7		0.2		—		—		—
Canadian Roundup Ready canola trait		4.0		4.0		4.3		4.9		2.8		0.5		—
Total Monsanto canola traits		4.9		4.9		5.0		5.1		2.8		0.5		-
TOTAL MONSANTO TRAIT ACRES **		134.8		118.3		96.5		86.4		53.4		14.0		3.0

*	“Stacked” trait categories reflect crops that contain two Monsanto technologies (both insect-protected and herbicide-tolerance).
**	Source: Monsanto estimates

Page 7

1996 - 2003 Monsanto Biotechnology U.S. Trait Acreage — Crop Year Basis

Monsanto Biotechnology Trait Acreage
(in millions of U.S. acres)	2003F		2002		2001		2000		1999		1998		1997		1996
Roundup Ready soybean trait		62.0		60.0		54.8		45.0		40.5		29.1		7.9		1.2
Total U.S. MON soybean trait		62.0		60.0		54.8		45.0		40.5		29.1		7.9		1.2
Roundup Ready corn trait		6.5		5.6		3.4		2.6		2.1		0.9		—		—
YieldGard corn borer traits		19.7		18.2		14.3		14.6		15.4		11.4		2.3		—
YieldGard rootworm corn trait		0.4		—		—		—		—		—		—		—
MON “stacked” corn traits*		5.1		2.2		1.2		0.1		—		—		—		—
Total U.S. MON corn traits		31.7		26.0		18.9		17.3		17.5		12.3		2.3		—
Roundup Ready cotton trait		4.5		5.2		5.1		4.6		3.8		2.1		0.6		—
Bollgard I and II cotton traits		0.3		0.4		0.5		1.0		2.0		2.0		2.0		1.8
MON “stacked” cotton traits*		5.4		4.8		5.6		4.0		2.4		0.7		0.1		—
Total U.S. MON cotton traits		10.2		10.4		11.2		9.6		8.2		4.8		2.7		1.8
Roundup Ready canola trait		0.9		0.9		0.9		0.7		0.2		—		—		—
Total U.S. MON canola traits		0.9		0.9		0.9		0.7		0.2		—		—		—
TOTAL U.S. MONSANTO TRAIT ACRES **		104.8		97.3		85.8		72.6		66.4		46.2		12.9		3.0

*	“Stacked” trait categories reflect crops that contain two Monsanto technologies (both insect-protected and herbicide-tolerance).
**	Source: Monsanto estimates

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