Crawford & Company · NYSE:CRD.A
Crawford & — Investor Presentation (November 2008)
26 slides from Crawford &'s investor presentation, Nov 6, 2008
Slide 1: Investor Presentation
Exhibit 99.1 Investor Presentation November 6, 2008 the STRENGTH of WORKING TOGETHER SM
Slide 2: Forward-looking Statements and Segment Operating Earnings
Forward-looking Statements and Segment Operating Earnings Forward Looking Statements: This presentation contains forward-looking statements, including statements about the future financial condition, results of operations and earnings outlook of Crawford & Company. Statements, both qualitative and q
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 4 The Strength of Working Together SM
Slide 5: Diversified Business Mix
Diversified Business Mix 2008 Revenues before Reimbursements of $786 Million Nine months ended September 30, 2008 Broadspire • Workers’ Compensation and Liability Claims Administration International • Medical and Case Management • Property and Casualty • Long-Term Care Services Services • Integrated
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 growin industry marked by demanding, value-driven clients, with high service level expectations. • Gl
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% 14 The Strength of Working Together SM
Slide 15: Financial Review
Financial Review the STRENGTH of WORKING TOGETHER SM
Slide 16: Year-to-Date September 30, 2008 Overview
Year-to-Date September 30, 2008 Overview • Strong performance in a difficult operating environment Revenue growth of 7.6% $ in millions Net Income up 86.7% 800 780 • Strong revenue growth internationally and in U.S. Property & Casualty offset declines in other lines 760 $785.7 International growth (
Slide 17: Year-to-Date September 30, 2008 Financials
Year-to-Date September 30, 2008 Financials CRAWFORD & COMPANY CONDENSED CONSOLIDATED STATEMENTS OF INCOME Unaudited (In Thousands, Except Earnings Per Share and Percentages) Nine Months Ended September 30 2008 2007 % Change Revenues: Revenues Before Reimbursements $785,693 $729,919 8% Reimbursements
Slide 18: Summary Results, U.S. Property & Casualty
Year-to-Date September 30, 2008 Financials Summary Results, U.S. Property & Casualty $ in millions For the nine months ended September 30, 2008 and 2007 170000 in Thousands Except Percentages Unaudited 160000 2008 2007 % Change 150000 $156.9 Revenues $ 156,935 $ 148,727 5.5% 140000 $148.7 Total Oper
Slide 19: Summary Results, International Operations
Year-to-Date September 30, 2008 Financials Summary Results, International Operations $ in millions For the nine months ended September 30, 2008 and 2007 340 in Thousands Except Percentages 320 Unaudited 300 $335.5 2008 2007 % Change 280 260 Revenues $ 335,505 $ 269,330 24.6% 240 $269.3 220 Total Ope
Slide 20: Summary Results, Broadspire
Year-to-Date September 30, 2008 Financials Summary Results, Broadspire $ in millions For the nine months ended September 30, 2008 and 2007 in Thousands Except Percentages 250 Unaudited 2008 2007 % Change $236.3 200 $246.1 Revenues $ 236,289 $ 246,092 -4.0% 150 Total Operating Expenses 230,923 242,56
Slide 21: Summary Results, Legal Settlement Administration
Year-to-Date September 30, 2008 Financials Summary Results, Legal Settlement Administration $ in millions For the nine months ended September 30, 2008 and 2007 70 in Thousands Except Percentages Unaudited 65 2008 2007 % Change $65.8 60 Revenues $ 56,964 $ 65,770 -13.4% 55 $57.0 Total Operating Expen
Slide 22: September 30, 2008 Balance Sheet
September 30, 2008 Balance Sheet Crawford & Company Consolidated Balance Sheet Highlights As of September 30, 2008 and December 31, 2007 In thousands, except percentages Unaudited September 30, December 31, 2008 2007* Change Cash and cash equivalents $56,819 $50,855 $5,964 Accounts receivable, net 1
Slide 23: Total Company Total Revenue Trend
Crawford & Company Total Company Total Revenue Trend As of September 2008 12-Month Moving Total Revenue Average Annual Rate of Change -12 Month Moving Total ($000s) 2008 Actual * 2007 Actual 2006 Actual 2008/2007 2007/2006 2006/2005 1st Quarter 987,046 861,524 789,255 As of September 30 8% 19% 6% 2n
Slide 24: Total Company Operating Earnings Trend
Crawford & Company Total Company Operating Earnings Trend As of September 2008 12-Month Moving Operating Earnings Average Annual Rate of Change -12 Month Moving Total ($000s) 2008 Actual* 2007 Actual 2006 Actual 2008/2007 2007/2006 2006/2005 1st Quarter 49,540 29,399 30,221 As of September 30 91% -5
Slide 25: Total Company Operating Earnings-to-Revenue Ratio Trend
Crawford & Company Total Company Operating Earnings-to-Revenue Ratio Trend As of September 2008 12-Month Moving Total Ratio Average Annual Rate of Change - 12 Month Moving Total ($000s) 2008 Actual 2007 Actual* 2006 Actual 2008/2007 2007/2006 2006/2005 1st Quarter 5.02% 3.42% 3.83% As of September 3
Slide 26: Total Company Operating Cash Flow
Crawford & Company Total Company Operating Cash Flow As of September 2008 12-Month Moving Operating Cash Flow Average Annual Rate of Change -12 Month Moving Total ($000s) 2008 Actual* 2007 Actual 2006 Actual 2008/2007 2007/2006 2006/2005 1st Quarter 51,372 11,989 61,066 As of September 30 105% -58%