Crawford & Company · NYSE:CRD.A
Crawford & — Q3 2008 Earnings Presentation
21 slides from Crawford &'s earnings presentation, Nov 3, 2008
Slide 1: Third Quarter 2008 Earnings Conference Call
Exhibit 99.2 Third Quarter 2008 Earnings Conference Call Monday, November 3, 2008 the STRENGTH of WORKING SM TOGETHER
Slide 2: Third Quarter Earnings Review
Third Quarter Earnings Review November 3, 2008 • Founded in 1941, Crawford is the largest independent global provider of claims management solutions and a fully integrated global provider of these solutions for the growing multi-national market. • Crawford is divided into four reporting segments tha
Slide 3: 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 4: "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 Sustained emphasis on sources of additional revenue growth – Selling Crawford services into the existing client b
Slide 5: Third Quarter 2008 Overview
Third Quarter 2008 Overview • Strong performance in a difficult operating $ in millions 270 environment 260 Revenue growth of 8.6% over 2007 quarter 250 240 $266.9 Net income up 100% over 2007 quarter 230 $245.8 • Sustained growth internationally and in U.S. 220 210 Property & Casualty offset declin
Slide 6: Financial Review
Third Quarter 2008 Financial Review the STRENGTH of WORKING SM TOGETHER
Slide 7: Third Quarter 2008 Financials
Third Quarter 2008 Financials CRAWFORD & COMPANY CONDENSED CONSOLIDATED STATEMENTS OF INCOME Unaudited (In Thousands, Except Earnings Per Share and Percentages) Three Months Ended September 30 2008 2007 % Change Revenues: Revenues Before Reimbursements $266,916 $245,774 9% Reimbursements 24,416 20,1
Slide 8: Summary Results, International Operations
Third Quarter 2008 Financials $ in millions Summary Results, International Operations 120 For the quarters ended September 30, 2008 and 2007 110 in Thousands Except Percentages 100 $115.4 Unaudited 90 2008 2007 % Change 80 $96.7 70 Revenues $ 115,362 $ 96,735 19.3% 60 3Q 2008 3Q 2007 Total Operating
Slide 9: Summary Results, Broadspire
Third Quarter 2008 Financials Summary Results, Broadspire $ in millions For the quarters ended September 30, 2008 and 2007 90 in Thousands Except Percentages 80 Unaudited 2008 2007 % Change 70 $78.4 $76.9 60 Revenues $ 76,911 $ 78,434 -1.9% 50 Total Operating Expenses 75,832 77,003 -1.5% 40 3Q 2008
Slide 10: Summary Results, Legal Settlement Administration
Third Quarter 2008 Financials Summary Results, Legal Settlement Administration 21 $ in millions For the quarters ended September 30, 2008 and 2007 20.5 in Thousands Except Percentages 20 Unaudited 19.5 $20.6 19 2008 2007 % Change 18.5 18 $18.4 Revenues $ 18,416 $ 20,622 -10.7% 17.5 17 15,563 3Q 2008
Slide 11: Summary Results, U.S. Property & Casualty
Third Quarter 2008 Financials $ in millions Summary Results, U.S. Property & Casualty 60 For the quarters ended September 30, 2008 and 2007 50 in Thousands Except Percentages 40 $56.2 $50.0 Unaudited 2008 30 2007 % Change 20 Revenues $ 56,227 $ 49,983 12.5% 10 0 Total Operating Expenses 49,446 46,46
Slide 12: Balance Sheet Highlights
Third Quarter 2008 Financials Crawford & Company 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 178,429 178,528 (9
Slide 13: Free Cash Flow (a non-GAAP measurement)
Third Quarter 2008 Financials Crawford & Company Free Cash Flow (a non-GAAP measurement) For the year-to-date periods ended September 30, 2008 and 2007 In thousands Unaudited September 30, September 30, 2008 2007 Variance Net Income $23,922 $12,812 $11,110 Depreciation / Non-Cash Items 22,737 22,146
Slide 14: Operations Review
Third Quarter 2008 Operations Review the STRENGTH of WORKING SM TOGETHER
Slide 15: Third Quarter 2008 Highlights: International Operations
Third Quarter 2008 Highlights • International Operations Claims referred in 000s Strong global revenue growth of 170 19.3%. Operating margin increased to 165 168.4 7.4% in 2008 from 6.5% in 2007. Claims referred decreased 5.3% 160 due to absence of 2007 CAT 159.4 155 claims. Revenue increased 14.6%
Slide 16: Third Quarter 2008 Highlights: U.S. Property & Casualty
Third Quarter 2008 Highlights • U.S. Property & Casualty Claims referred in 000s Revenue growth of 12.5%. Operating margin increased to 135 12.1% in 2008 from 7.0% in 2007. 125 Catastrophe revenue up $2.9 115 million. 105 134.0 Technology-driven efficiencies 95 116.0 realized. 85 Claims referred inc
Slide 17: Crawford U.S. Catastrophe (CAT) Activity
Crawford U.S. Catastrophe (CAT) Activity Quarter ended Sept. 30: Nine months ended Sept. 30: CAT Revenues CAT Revenues $ in millions $ in millions 8 15 6 10 $6.3 $11.6 4 $3.4 5 $6.5 2 0 0 2008 2007 2008 2007 CAT Cases CAT Cases In 000s In 000s 15 30 10 12.5 20 20.2 5 6.5 10 9.9 0 0 2008 2007 2008 20
Slide 18: Third Quarter 2008 Highlights: Broadspire
Third Quarter 2008 Highlights • Broadspire Revenue decline of 1.9% Claims referred in 000s Operating earnings of $1.1 million in the 71 quarter. 69 RiskTech deployment on schedule 67 65 70.3 93% retention rate. 63 Worker’s Comp market continues 61 63.1 challenging as claims referred declined 59 10.3
Slide 19: Third Quarter 2008 Highlights: Legal Settlement Administration
Third Quarter 2008 Highlights Backlog in millions • Legal Settlement Administration 50 Revenue declined 10.7%. 45 Operating margin increased to 15.5% 40 from 10.3% in 2007 through strong 35 $43.5 cost management. 30 $39.1 Backlog of $43.5 million. 25 20 3Q 2008 3Q 2007 Backlog 19
Slide 20: Outlook
Outlook • Full Year 2008: – Consolidated revenue before reimbursements between $1.04 billion and $1.05 billion. – Consolidated operating earnings between $68.1 million and $72.4 million. – After reflecting stock-based compensation expense, net corporate interest expense, customer-relationship intang
Slide 21: WORKING TOGETHER
the STRENGTH of WORKING SM TOGETHER