Crawford & Company · NYSE:CRD.A
Crawford & — Q2 2013 Earnings Presentation
25 slides from Crawford &'s earnings presentation, Aug 5, 2013
Slide 1: Second Quarter Earnings Conference Call August 5, 2013
Crawford & Company Second Quarter Earnings Conference Call August 5, 2013
Slide 2: Forward-Looking Statements and Additional Information
Crawford & Company FORWARD-LOOKING STATEMENTS AND ADDITIONAL INFORMATION 2 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, bot
Slide 3: Global Business Services Leader
Crawford & Company Global Business Services Leader The world’s largest independent provider of global claims management solutions Multiple globally recognized brand names: Crawford, Broadspire, GCG Clients include multinational insurance carriers, brokers and local insurance firms as well as o
Slide 4: Today's Agenda
Today’s Agenda Welcome and Opening Comments Second Quarter 2013 Financial Review Second Quarter 2013 Operational Review Guidance and Future Operational Focus
Slide 5: Business Summary
Crawford & Company Second Quarter 2013 Business Summary $0 $100 $200 $300 $400 Q2 2013 Q2 2012 Revenues ($ in millions) 5 Revenues increased 2% to $299.0 million Consolidated operating earnings increased 27% to $30.4 million Improvement in Broadspire and Americas operating results Net income increas
Slide 6: Second Quarter 2013 Financial Review
Second Quarter 2013 Financial Review
Slide 7: Income Statement Highlights
Crawford & Company Second Quarter 2013 Financials 7 Crawford & Company Income Statement Highlights Unaudited ($ in thousands, except per share amounts) Quarters Ended June 30, 2013 2012 % Change Revenues $298,947 $293,847 2% Costs of Services 212,333 212,815 - Selling, General, and Administrative Ex
Slide 8: Summary Results: Americas
Crawford & Company Second Quarter 2013 Financials 8 Summary Results: Americas Unaudited ($ in thousands) For the quarters ended June 30, Growth in Contractor Connection drove higher U.S. revenues in the 2013 period Claims increased in Canada in the 2013 second quarter $0 $25 $50 $75 $100 2Q 2013
Slide 9: Summary Results: U.S. Catastrophe (CAT) Adjuster Activity
Crawford & Company Second Quarter 2013 Financials 9 Summary Results: U.S. Catastrophe (CAT) adjuster activity CAT adjuster revenues of $6.3 million in second quarter of 2013 compared with $5.5 million in 2012 period CAT cases numbered 8,700 in the second quarter of 2013 compared with 7,500 in th
Slide 10: Summary Results: EMEA/AP
Crawford & Company Second Quarter 2013 Financials 10 Summary Results: EMEA/AP Unaudited ($ in thousands) For the quarters ended June 30, Revenues and operating earnings declined quarter over quarter due to the winding down of claims in Thailand and reduction in claims activity in the U.K. $50 $60
Slide 11: Summary Results: Broadspire
Crawford & Company Second Quarter 2013 Financials 11 Summary Results: Broadspire Unaudited ($ in thousands) For the quarters ended June 30, Meaningful sequential improvement in operating performance over the 2013 first quarter Revenues and operating earnings increase included a $3.0 million one-
Slide 12: Summary Results: Legal Settlement Administration
Crawford & Company Second Quarter 2013 Financials 12 Summary Results: Legal Settlement Administration Unaudited ($ in thousands) For the quarters ended June 30, $20 $30 $40 $50 $60 $70 2Q 2013 2Q 2012 Revenues ($ in millions) $0 $3 $6 $9 $12 $15 $18 2Q 2013 2Q 2012 Operating Earnings ($ in millions)
Slide 13: Balance Sheet Highlights
Crawford & Company Second Quarter 2013 Financials 13 Crawford & Company Balance Sheet Highlights Unaudited ($ in thousands) June 30, December 31, 2013 2012 Change Cash and cash equivalents $47,178 $71,157 ($23,979) Accounts receivable, net 179,087 164,708 14,379 Unbilled revenues, net 137,581 124,88
Slide 14: Operating and Free Cash Flow
Crawford & Company Second Quarter 2013 Financials 14 Crawford & Company Operating and Free Cash Flow Unaudited ($ in thousands) For the quarters ended June 30: 2013 2012 Variance Net Income Attributable to Shareholders of Crawford & Company $26,747 $16,490 $10,257 Plus: Depreciation and Other Non-Ca
Slide 15: Second Quarter 2013 Operational Review
Second Quarter 2013 Operational Review
Slide 16: Second Quarter Business Drivers
Crawford & Company Second Quarter Operational Review 16 Second Quarter Business Drivers $270 $275 $280 $285 $290 $295 $300 $305 $310 $315 2Q 2013 1Q 2013 4Q 2012 3Q 2012 2Q 2012 Revenues ($ in millions) 305 310 315 320 325 330 335 340 345 2Q 2013 1Q 2013 4Q 2012 3Q 2012 2Q 2012 Cases Received (In th
Slide 17: Operational Review: Americas
Crawford & Company Second Quarter Operational Review 17 Americas $0 $10 $20 $30 $40 $50 $60 U.S. Canada Latin America Revenues by Geographic Region ($ in millions) U.S. Property and Casualty Solid growth in Contractor Connection revenues Increase in CAT activity Canada Won several large new accounts
Slide 18: Operational Review: EMEA/AP
Crawford & Company Second Quarter Operational Review 18 EMEA/AP $0 $5 $10 $15 $20 $25 $30 $35 $40 U.K. CEMEA Asia-Pacific Revenues by Geographic Region ($ in millions) U.K. Reduction in weather-related property claim volumes Continued focus on Global Technical Services (GTS) expansion CEMEA Claims v
Slide 19: Operational Review: Broadspire
Crawford & Company Second Quarter Operational Review 19 Broadspire $0 $5 $10 $15 $20 $25 $30 $35 Workers' Comp. Medical Mgmt. Risk Mgmt. Info. Svcs. Revenues by Service Line ($ in millions) Broadspire case volume improved One-time revenue and operating earnings benefit of $3.0 million during the
Slide 20: Operational Review: Legal Settlement Administration
Crawford & Company Second Quarter Operational Review 20 Legal Settlement Administration $0 $20 $40 $60 $80 $100 $120 $140 2Q 2013 2Q 2012 Backlog ($ in millions) Deepwater Horizon class action project continued Large class action projects ramped up in the quarter, which gave balance to revenues
Slide 21: 2013 Guidance
Crawford & Company 2013 Guidance 21 Crawford & Company is affirming and increasing certain aspects of its full year 2013 guidance as follows: Consolidated revenues before reimbursements between $1.12 and $1.14 billion Consolidated operating earnings between $95.0 and $99.0 million Consolidated
Slide 22: 2013 Operational Focus
Crawford & Company 2013 Operational Focus 22 Sustain Operating Performance through Improved Profitability Americas improvement in U.S. Property & Casualty and Canada Continued progress in Broadspire Strengthen the Balance Sheet Manage debt levels and pension obligations Drive operating cash
Slide 23: Second Quarter 2013 Appendix
Second Quarter 2013 Appendix
Slide 24: Appendix: Non-GAAP Financial Information
Crawford & Company Appendix: Non-GAAP Financial Information 24 Measurements of financial performance not calculated in accordance with GAAP should be considered as supplements to, and not substitutes for, performance measurements calculated or derived in accordance with GAAP. Any such measures are n
Slide 25: Reconciliation of Non-GAAP Items
Crawford & Company Reconciliation of Non-GAAP Items 25 Unaudited ($ in thousands) June 30, December 31, 2013 2012 Net Debt Short-term borrowings 21,120$ 13,275$ Current installments of long-term debt and capital leases 847 838 Long-term debt and capital leases, less current installments 151,936 152,