Crawford & Company · NYSE:CRD.A
Crawford & — Investor Presentation (September 2008)
25 slides from Crawford &'s investor presentation, Sep 18, 2008
Slide 1: Investor Presentation
Exhibit 99.1 Investor Presentation September 18-19, 2008
Slide 2: Forward-looking Statements
Forward-looking Statements This presentation includes forward-looking statements, including statements about the financial condition, results of operations and earnings outlook of Crawford & Company. Statements, both qualitative and quantitative, that are not historical facts may be “forward-looking
Slide 3: Crawford & Company
Crawford & Company • World’s largest fully-integrated independent provider of global claims management solutions. • Four reporting segments: – International Operations • Serves the global insurance industry and multi-national corporations – U.S. Property & Casualty • Serves the U.S. insurance compan
Slide 4: Locations
Locations 700 locations in 63 countries SM 4 The Strength of Working Together
Slide 5: Diversified Business Mix
Diversified Business Mix Revenues before Reimbursements of $519 Million Six Months Ended June 30, 2008 Broadspire • Workers’ Compensation and Liability Claims Administration International • Medical and Case Management • Property and Casualty • Long-Term Care Services Services • Integrated Disability
Slide 6: International Property & Casualty Insurance Market Opportunities
International (excluding U.S.) Property & Casualty Insurance Market Opportunities • Only 4.4% of dollars spent by rest of world (ROW) carriers on claims are outsourced to third party independent adjusters • Very few global claims providers • As ROW insurance carriers look to consolidate claims servi
Slide 7: International Strengths and Opportunities
International Strengths and Opportunities • Best infrastructure among independents builds on industry trend of consolidation of clients. • Bench strength of International Leadership Team required to grow in industry marked by demanding, value-driven clients, with high service level expectations. • G
Slide 8: U.S. Insurance Market Opportunities
U.S. Insurance Market Opportunities • Approximately 14% of dollars spent by U.S. carriers on claims services are outsourced to third parties – High propensity to outsource non-core lines and/or non-core states • Outsourced claims service provider market is highly fragmented – Crawford is the market
Slide 9: U.S. Property & Casualty Growth Opportunities
U.S. Property & Casualty Growth Opportunities • Strategic Growth – Target large insurers who are consolidating their vendor lists and ensure Crawford is named an approved vendor • Quality improvement • Efforts toward training and product development – Target markets • Small and mid-market carriers •
Slide 10: U.S. Self-Insured Entities and Captives Market Opportunities
U.S. Self-Insured Entities and Captives Market Opportunities • Self-insured entities and captives outsource practically all of their claims services • Outsourced total claims management is fragmented • Local and regional providers unable to leverage technology investment Unallocated Loss Adjusting E
Slide 11: Broadspire Strengths and Opportunities
Broadspire Strengths and Opportunities • Strengths – Proven faster return-to-work for employees and cost savings to clients – Superior measurement and reporting of those results – Fully integrated services that make programs easy to administer – Superior medical protocols that produce bottom-line re
Slide 12: Legal Settlement Administration
Legal Settlement Administration • The Garden City Group, Inc. (GCG) Products and Services – Administers class action settlements – Designs and implements legal notice programs – Manages chapter 11 bankruptcy claims administration – Executes complete document management services – Obtains expert cons
Slide 13: The Strength of Working Together
“The Strength of Working Together” “The Strength of Working Together” is unifying the Company around consistent goals: Adaptive leadership team responding to changing economic conditions Increasing emphasis on sources of additional revenue growth – Selling Crawford services into the existing client
Slide 14: Medium Term Goals
Medium Term Goals • Grow revenues organically by 5% CAGR through 2010 • Achieve a 10% EBIT margin by 2010 • Continued commitment to sound financial management and maximizing shareholder value • Target debt as a percentage of total capital at 25% to 30% SM 14 The Strength of Working Together
Slide 15: Financial Review
Ce tor d Financial Review ef mn the STRENGTH of WORKING TOGETHER”
Slide 16: Year-to-Date June 30, 2008 Overview
Year-to-Date June 30, 2008 Overview • Strong performance in a difficult operating environment Revenue growth of 7.2% supported by cost reduction initiatives $ in millions Net Income up 81.6% 520 510 • Strong revenue growth internationally and in U.S. 500 $518.8 Property & Casualty offset declines in
Slide 17: Year-to-Date June 30, 2008 Financials
Year-to-Date June 30, 2008 Financials CRAWFORD & COMPANY CONDENSED CONSOLIDATED STATEMENTS OF INCOME Unaudited (In Thousands, Except Per Share Amounts) Six Months Ended June 30 2008 2007 % Change Revenues: Revenues Before Reimbursements $518,777 $484,145 7% Reimbursements 45,162 34,678 30% Total Rev
Slide 18: U.S. Property & Casualty Summary Results
Year-to-Date June 30, 2008 Financials U.S. Property & Casualty Summary Results $ in millions For the year-to-date periods ended June 30, 2008 and 2007 120 in Thousands Except Percentages Unaudited 100 2008 2007 % Change 80 $100.7 60 $98.7 Revenues Before Reimbursements $ 100,708 $ 98,744 2.0% 40 20
Slide 19: International Summary Results
Year-to-Date June 30, 2008 Financials International Summary Results 250 $ in millions For the year-to-date periods ended June 30, 2008 and 2007 in Thousands Except Percentages 200 $220.1 Unaudited 150 $172.6 2008 2007 % Change 100 Revenues Before Reimbursements $ 220,143 $ 172,595 27.5% 50 Total Ope
Slide 20: Broadspire Summary Results
Year-to-Date June 30, 2008 Financials Broadspire Summary Results $ in millions For the year-to-date periods ended June 30, 2008 and 2007 200 in Thousands Except Percentages Unaudited 150 2008 2007 % Change $159.4 100 $167.7 Revenues Before Reimbursements $ 159,378 $ 167,658 -4.9% 50 Total Operating
Slide 21: Legal Settlement Administration Summary Results
Year-to-Date June 30, 2008 Financials Legal Settlement Administration Summary Results $ in millions 46 For the year-to-date periods ended June 30, 2008 and 2007 in Thousands Except Percentages 44 Unaudited 42 $45.1 2008 2007 % Change 40 38 Revenues Before Reimbursements $ 38,548 $ 45,148 -14.6% $38.
Slide 22: June 30, 2008 Financials: Balance Sheet Highlights
June 30, 2008 Financials Crawford & Company Consolidated Balance Sheet Highlights As of June 30, 2008 and December 31, 2007 (in thousands, except percentages) Unaudited June 30, December 31, 2008 2007* Change Cash and cash equivalents $48,346 $50,855 ($2,509) Accounts receivable, net 191,980 178,528
Slide 23: Total Company Total Revenue Trend
Crawford & Company Total Company Total Revenue Trend 12-Month Moving Total Revenue Average Annual Rate of Change - 12 Month Moving Total ($000's) 2008 2007 2006 2008/2007 2007/2006 2006/2005 1st Quarter 987,046 861,524 789,255 As of June 2008 11% 14% 4% 2nd Quarter 1,009,775 909,458 795,856 FULL YEA
Slide 24: Total Company Operating Earnings Trend
Crawford & Company Total Company Operating Earnings Trend 12-Month Moving Operating Earnings Average Annual Rate of Change - 12 Month Moving Total ($000's) 2008 2007 2006 2008/2007 2007/2006 2006/2005 1st Quarter 49,538 29,399 30,221 As of June 2008 76% 1% 0% 2nd Quarter 57,963 32,617 32,233 FULL YE
Slide 25: Total Company Operating Earnings-to-Revenue Ratio Trend
Crawford & Company Total Company Operating Earnings-to-Revenue Ratio Trend 12-Month Moving Total Ratio Average Annual Rate of Change - 12 Month Moving Total ($000's) 2008 2007 2006 2008/2007 2007/2006 2006/2005 1st Quarter 5.02% 3.42% 3.83% As of June 2008 2.10% -0.46% -0.18% 2nd Quarter 5.74% 3.59%