Q2 2024 Crawford & Co Earnings Call

Operator: second quarter 2024 earnings release conference call. In conjunction with that call, a supplementary financial presentation is available on our website at www.crawco.com under the Investor Relations section. All lines have been placed on mute to prevent any background noise.

<unk> 2024 earnings release conference call in conjunction with that call a supplementary financial presentation is available on our website at triple the volume Crackle Dot com under the Investor Relations section.

Operator: After the speaker's remarks, there will be a question and answer period, and instructions will follow at that time. Should anyone need assistance at any time during this conference, please press star zero, and an operator will assist you. As a reminder, ladies and gentlemen, this conference is being recorded today, Tuesday, August 6, 2024. Now, I would like to introduce Tami Stevenson, Crawford & Co.'s General Counsel.

Speaker Change: All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer period and instructions will follow at that time should anyone need assistance at any time chain. This conference. Please press star zero and an operator will assist you as a reminder, ladies and gentlemen, this <unk>.

Speaker Change: <unk> is being recorded today Tuesday August six 2024.

Speaker Change: Now I would like to introduce Tommy's Stevenson Crawford <unk> company's general counsel.

Tami Stevenson: Thank you, Julie. Some of the matters to be discussed in this conference call and in the supplementary financial presentation may include forward-looking statements that involve risks and uncertainty. These statements may relate to, among other things, our expected future operating results and financial condition, our ability to grow revenues and reduce operating expenses, expectations regarding our anticipated contributions to our underfunded Defined Benefit Pension Plan, and collectibility of our billed and unbilled account receivable.

Speaker Change: Thank you Julie.

Speaker Change: Some of the matters to be discussed in this conference call and in the supplementary financial presentation may include forward looking statements that involve risks and uncertainties. These.

Speaker Change: These statements may relate to among other things our expected future operating results and financial condition, our ability to grow revenues and reduce our operating expenses expectations regarding our anticipated contributions to our underfunded defined benefit pension plans collectability of our billed and Unbilled accounts receivable financial results from our reach.

Tami Stevenson: Financial results from our recently completed acquisitions, our continued compliance with the financial and other covenants contained in our financing agreements, our long-term capital resources and liquidity requirements, and our ability to pay dividends in the future. The company's actual results achieved in future quarters could differ materially from the results that may be implied by such forward-looking statements. The company undertakes no obligation to publicly release revisions to any forward-looking statements made in this conference call to reflect events or circumstances occurring after the date of the call or to reflect the occurrence of unanticipated events.

Speaker Change: Completed acquisitions are.

Tami Stevenson: In addition, it is reminded that operating results for any historical period are not necessarily indicative of results to be expected for any future period. For a complete discussion regarding factors that could affect the company's financial performance, please refer to the company's Form 10-Q for the quarter ended June 30, 2024, filed with the Securities and Exchange Commission, particularly the information under the headings Risk Factors and Management's Discussion and Analysis of Financial Condition and Results of Operations, as well as subsequent company filings with the SEC.

Tami Stevenson: This presentation also includes certain non-GAAP financial measures as defined under the SEC rules. As required, a reconciliation is provided for those measures to the most directly comparable GAAP measures. I would like now to introduce Mr. Rohit Verma, Chief Executive Officer of Crawford & Co. Rohit, you may begin. Thank you, Tami.

Rohit Verma: Thank you, Tami. Good morning and welcome to our second quarter 2024 earnings call. Joining me today is Bruce Swain, our Chief Financial Officer, and Tami Stevenson, our General Counsel. Before we start today, the board and I would like to give a warm welcome to our new director, Joel Murphy.

Rohit Verma: Additionally, we would like to thank departing board members Charlie Ogburn and Michelle Gerard for their service to Crawford & Co. We look forward to collaborating with Joel and wish Charlie and Michelle very well. The second quarter of 2024 demonstrated the continued strength of our core non-weather businesses, which delivered strong performances. Although we did continue to see the impact of benign weather reflected in revenues from weather-related business, today, I will take you through the operational highlights of the quarter, and then I will turn over to Bruce for a deeper review of the financial results for the second quarter.

Rohit Verma: As most of you know, Crawford is the leading publicly traded claims management provider handling over $20 billion in claims annually across 70 countries, and we serve a well-known base of clients, including some of the most recognizable names in the industry. With a workforce of around 10,000 skilled professionals and tens of thousands of field resources, our extensive scale and global reach distinguish us in a fragmented market, positioning us as a preferred partner for top carriers, many of whom are long-standing customers. Crawford is an organization with more than 80 years of history, and our focus is on building long-term and sustainable value for all stakeholders.

Rohit Verma: We have faced a lot of different market dynamics since the company's founding and continue to strategically evolve the model to perform and thrive in all market environments. Extreme weather events are becoming more severe and more frequent globally, driving long-term growth in weather-related claims revenue for Crawford. Despite relatively benign weather in the last nine months, our catastrophe-specific teams remain crucial in supporting carriers and policyholders when severe weather hits. While our weather-related revenue can fluctuate, experts believe that claims associated with extreme weather are likely to increase for the foreseeable future, underscoring the importance of our dedicated catastrophe teams in the face of rising long-term demand. Second, Crawford is ideally suited to meet the demand for increased outsourcing of claims processing through our ability to provide capacity, expertise, and scale for the efficient and cost-effective management of outsourced claims.

Weather events are becoming more severe and more frequent globally.

Speaker Change: Driving long term growth in weather related claims revenue for Crawford.

Speaker Change: Despite relatively benign weather in the last nine months, our catastrophe specific teams remain crucial in supporting carriers and policyholders when severe weather hits.

Speaker Change: While our weather related revenue can fluctuate experts believe that claims associated with extreme weather unlikely to increase for the foreseeable future underscoring the importance of our dedicated catastrophe teams in the face of rising long term demand.

Speaker Change: Second Crawford is ideally suited to meet the demand of increased outsourcing of claims processing through our ability to provide capacity expertise and scale for the efficient and cost effective management of outsource claims.

Rohit Verma: Third, we are gaining share in the fragmented U.S. independent loss-adjusting market and continue to build and strengthen our partnerships across all our verticals. Finally, our proprietary insurance technology saves our clients time and money, and we continuously invest in developing, enhancing, and deploying advanced technology solutions around the world. Turning to our quarterly performance, we continue to demonstrate strength in our core business with growth in three of our four segments this quarter. However, our overall consolidated results were impacted by the benign weather trend we have seen over the last nine months.

Speaker Change: Third we are gaining share in the fragmented U S independent loss adjusting market and continue to build and strengthen our partnerships across all our verticals.

Speaker Change: Finally, our proprietary insurance technology saves, our clients time, and money and we continuously invest in developing enhancing and deploying advanced technology solutions around the world.

Speaker Change: Turning to our quarterly performance.

Rohit Verma: Damage resulting from severe convective storm activity and catastrophic events was at an unusually high level in 2023, and many of these events did not repeat in the second quarter of 2024. As a result, second quarter revenue decreased to $314 million compared to $325 million in the second quarter of 2023. Our operating earnings of $22.1 million also came in just slightly below the second quarter of 2023.

Speaker Change: We continued to demonstrate strength in our core business with growth in three of our four segments. This quarter. However.

Speaker Change: However, our overall consolidated results were impacted by the benign weather trend we have seen over the last nine months.

Rohit Verma: Importantly, our non-weather businesses performed well this quarter, underscoring the balance and resilience of Crawford's business platform. By growing and strengthening our operations, we are well positioned to meet our clients' diverse needs during all weather patterns. Broughtspire achieved significant growth again this quarter, setting a new quarterly revenue and earnings record.

Rohit Verma: Our GTS service line also had record revenue this quarter, and we saw solid growth in our international operations. Our efforts to improve efficiencies across our business are yielding results, with operating earnings growth in three segments this quarter. And as a result of the hard work of our talented staff and proven success fostering client relationships, we added a total of $23 million in new and enhanced business this quarter. As always, our conservative approach to capital management is reflected in the strength of our balance sheet.

Rohit Verma: As we discussed last quarter, our weather-related business faces a difficult comparison to elevated catastrophe activity in the first half of 2023. As shown by the chart on the left, at Crawford, we achieved 6% growth in our non-weather business this quarter, which reflects the continued traction we are getting in our growth strategy that is diversifying our revenue mix. Our weather-related business, which includes U.S. CAT, U.S. loss-adjusting in Australia, decreased 21%. The middle chart shows our network business.

Rohit Verma: As a reminder, networks serve our largest clients with their catastrophe-specific claims handling needs. Similar to the first quarter of this year, this segment saw a decrease in revenues from claims management services, frequently tied to storm activity. Our network service lines saw a revenue decline of 65% this quarter directly related to reduced weather-related claims.

Rohit Verma: Reducing losses associated with storm activity has been observed across the industry. As shown in the chart on the right, Gallagher Re reported a 21% decrease in insured losses from U.S. severe convective storms in the first half of 2024, consistent with the decrease we have seen in our weather-related business. This may sound surprising given the significant weather events in the news, including last month's Hurricane Beryl, one of the earliest storms in the U.S. However, in short, damage from Hurricane Beryl was lower than similar storms in prior years.

Rohit Verma: Given the available capacity at carriers due to benign weather patterns seen over the last nine months, we expect minimum revenue impact from barrel. To date, in 2024, carriers have largely managed claims in-house. However, our teams stand ready to provide crucial support assisting carriers in managing increased claim volumes and aiding in the rebuilding of severely affected communities when severe storm activity picks up.

Rohit Verma: Our capital allocation strategy focuses on investing in innovation and technology to enhance claims handling and pursuing strategic acquisitions and partnerships to expand market share. We are disciplined in our approach to capital allocation, and our balanced approach is centered on driving sustainable long-term growth and delivering enhanced value to shareholders. Our leverage ratio remains low at 2.09 times EBITDA, giving us significant financial flexibility and liquidity. Additionally, we prioritize returning capital to shareholders via regular dividends, reflecting a strong balance. We continued our quarterly dividend of $0.07 for CRDA and CRDB shares in the second quarter of 2024. With that, I will turn the call over to Bruce for a deeper look at our operational and financial performance.

Bruce Swain: Thank you, Rohit. As most of you know, our business is diversified and is comprised of four segments. North America Loss Adjusting encompasses our loss adjusting business in the U.S. and Canada and accounted for 24% of our second quarter 2024 revenues. Our international business is comprised of all reported service lines outside of North America and contributed 33% of revenues. Broadspire is our third-party administrator in the U.S. and accounts for 31% of our revenues. And Platform Solutions, which includes Contractor Connection and our networks and subrogation businesses, contributed 12%. Now, let's review each of these segments.

Speaker Change: Says our loss adjusting business in the U S and Canada and accounted for 24% of our second quarter 2024 revenues. Our international business is comprised of all reported service lines outside of North America and contributed 33% of revenues.

Speaker Change: <unk> is our third party administrator in the U S and accounts for 31% of our revenues and platform solutions, which includes contractor connection and our networks and subrogation businesses contributed 12%.

Speaker Change: Now, let's review each of these segments, beginning with North America loss adjusting in the second quarter of 2024, our revenues were $76 million consistent with the prior year quarter operating earnings were $4 9 million, an increase of 25% over the $3 9 million in the prior year quarter, and our margin increased 100 and.

Bruce Swain: Beginning with North America loss adjusting, in the second quarter of 2024, our revenues were $76 million, consistent with the prior year quarter. Operating earnings were $4.9 million, an increase of 25% over the $3.9 million in the prior year quarter, and our margin increased 132 basis points to 6.4% from 5.1% in the prior year quarter. Our margin expansion in the quarter was largely due to our ability to expand market share and grow our customer base in the GTS service line, which had another record revenue quarter.

Speaker Change: 32 basis points to six 4% from five 1% in the prior year quarter.

Speaker Change: Our margin expansion in the quarter was largely due to our ability to expand market share and grow our customer base in the GTS service line, which had another record revenue quarter.

Bruce Swain: International operations revenue for the 2024 second quarter was $102.3 million, and operating earnings were $5.7 million. Our revenue grew 7% from $95.3 million in the second quarter of 2023, or 9% when measured in constant currency. Our operating earnings showed a significant increase of more than 50% over the prior year quarter, reflecting improved performance in the UK and Europe. However, we still have work to do in our international operations to return to historical margin levels. But it is clear that our efforts to turn around this segment post-pandemic have positioned us for long-term success and growth in key markets.

Bruce Swain: Rotzfeier showed continued strength in the quarter, setting a new quarterly revenue record of $97.1 million in the second quarter, an 11% increase from $87.2 million in the second quarter of 2023. Operating earnings for the second quarter were also a record of $15.1 million compared to $8.1 million, reflecting operating margin expansion of 620 basis points to 15.5%. Medical Management Services and Claims Management both showed strong growth of 11% in the quarter.

Bruce Swain: Client wins continue to be our strongest growth driver, and our talented teams have been performing at a consistently high level in 2024. Additionally, we retain 95% of our business year-to-date, contributing to solid recurring revenues in the segment. Platform Solutions second quarter revenues of $38.8 million decreased by approximately 41% compared with $65.6 million in the second quarter of 2023. Operating earnings and platform revenues totaled $1.5 million, or 3.8% of segment revenues in the 2024 quarter, compared to operating earnings of $8.1 million, or 12.3% of revenues in the prior year quarter.

Bruce Swain: As Rohit mentioned earlier, the weakness in this segment is primarily attributed to softness in the networks business related to reduced catastrophe activity, reflecting the notable reduction in insured losses from U.S. severe convective storms year over year. We continue to keep our catastrophe response team well positioned for the potential of increased activity as we move through the hurricane season.

Bruce Swain: And now for a look at our consolidated financials. In the second quarter of 2024, company-wide revenues before reimbursements decreased 3.2% to $314.2 million. Foreign exchange rates decreased revenues before reimbursements by 1.9 million, or less than 1%. Gap net income attributable to shareholders totaled $8.6 million, compared to net income of $8.4 million in the same period of 2023. Gap diluted EPS in the 2024 second quarter was $0.17 for both CRDA and CRDB, consistent with $0.17 for both share classes in the 2023 period. On a non-GAAP basis, diluted EPS was $0.25 for both CRDA and CRDB, compared to $0.24 for both share classes in the prior year period.

Bruce Swain: The companies' non-GAAP operating earnings totaled $22.1 million in the 2024 second quarter, or 7% of revenues, compared to $22.8 million, or 7% of revenues in the prior year period. Consolidated Adjusted EBITDA was $30.6 million in the 2024 second quarter, or 9.7% of revenues, compared to $31.5 million, or 9.7% of revenues in the 2023 quarter. The company's cash and cash equivalent position as of June 30, 2024 totaled $46.7 million, compared to $58.4 million at the end of 2023. Our total receivables were up $17 million from the 2023 year-end, primarily due to an increase in unbilled revenues that we expect to unwind through the remainder of the year.

Bruce Swain: The companies' total debt outstanding as of June 30, 2024 totaled $233.8 million, up from $209.1 million as of December 31, 2023, which is not unusual for the front half of the year. Net debt stood at $187.1 million as of June 30, 2024, while our U.S. pension liability was $23.2 million at the end of the second quarter, reflecting a funded ratio of 92.6%. We made no discretionary contributions to our U.S. Defined Benefit Pension Plan during the second quarter of 2024, and we do not intend to make contributions for the remainder of the year.

Bruce Swain: Cash used in operating activities for the 2024 year-to-date period was a use of $8.3 million, with a negative $26.7 million. This compares to cash flow from operations last year of $27.2 million and $9.2 million. This decrease in free cash flow was primarily due to lower operating earnings, higher incentive compensation payments compared to the prior year, and other working capital increases.

Bruce Swain: With that, I'll turn the call back over to Rohit for his concluding remarks.

Rohit Verma: Thank you, Bruce. To conclude, we saw some very encouraging earnings growth and margin expansion this quarter in three of our four segments. I am optimistic about our overall trajectory and momentum with our strong business foundation and proven growth strategy. Thank you for your time today. Julie, please open the call for questions. Thank you.

Operator: Thank you. At this time, if you'd like to ask a question, please press star, then the number 1 on your telephone keypad. To withdraw your question, press star, followed by 2. We'll pause for just a moment to compare the Q&A list. Your first question comes from Mark Hughes from Truist. Please go ahead.

Mark Hughes: Yeah, thank you. Good morning.

Operator: Morning Mark. Morning Mark.

Rohit Verma: The Broad Spire profitability was very good in the quarter. Anything unusual boosting that, or is this a level that might be sustainable?

Rohit Verma: Hi Mark, this is Rohit. As you know, we've been investing significantly in BroadSpyre, and we've been developing a strategy that has been focused on developing an unbundled technology and medical management offering as well as focusing on the alternative insurance market. All those strategies are working and clicking well. We believe that the work that we have done is showing results. We expect to continue making investments from a technology standpoint and be the leading technology-led provider in terms of BroadSpyre services.

Speaker Change: It's showing the results we expect to continue making investments from a technology standpoint, and be the leading technology led provider in terms of broad spire services. So we feel very good about where we are we've also had a good run of new business. There I think you've heard that in a strong retention at over 95%. So all of those factors are contributing.

Rohit Verma: So we feel very good about where we are. We've also had a good run of new business there, and I think you've heard that, and a strong retention rate of over 95%. So all those factors are contributing, and we expect to maintain those factors, which should continue to add to the profit. I'll maintain the profitability.

Speaker Change: We expect to maintain those factors, which should which should continue to add to their profitability.

Speaker Change: Our maintain the profitability I should say.

Speaker Change: Yeah Yeah.

Rohit Verma: On GTS, you talked about the good growth there, I think record revenue. Is that utilization, or have you been adding staff there driving the top line?

Speaker Change: GTS talked about good good growth there I think record revenue is that utilization or have you been adding staff there driving the top line.

Rohit Verma: Yeah, so I think we were, as you know, we had shared this at least two years ago now, maybe close to three years ago, that our strategy in GTS was to build an expertise-led model and continue to add to that expertise. We had made a commitment of adding 200 plus resources, which we were supposed to meet by the end of 2023, but we actually met that goal in the early part of 2023. And since then, we've had an opportunity to continue to add additional expertise and resources to that and gain more nominated accounts over the period. So all that has contributed to growth. And again... We're not stopping. We'll opportunistically continue to add experts when we find them and where we find them.

Speaker Change: Yes. So I think we were as you know we had shared this at.

Speaker Change: Just two years ago now, maybe maybe close to three years ago that our strategy in GTS was to build an expertise led model and continue to add to that expertise. We had made a commitment of adding 200, plus resources, which we were supposed to meet by the end of 2023, but we actually met that goal early part of 2023 and since then we've had.

Speaker Change: You've had an opportunity to continue to add additional expertise and resources to that and gain more nominated accounts over the period. So all of that has contributed to the growth in again.

Rohit Verma: In the international business, you had some nice recovery in margin, but have you taken the steps that you're able to take, and perhaps the margin is more dependent on the top line from here, or are there more internal actions you can take to help improve profitability?

Rohit Verma: Look, we are very pleased with the recovery that we've seen in international as well. We do believe that this is a multi-year journey, as we've shared before, and we are partly into that journey. We expect to continue to make some more changes in the coming quarters, so we should see profitability continue to move. Is it where we want it to be? No, not yet. But we are on a journey to bring it back to pre-COVID levels, and we believe that we'll get there.

Rohit Verma: And then one more, if I might, on the weather-related lines where you've seen some pressure lately. Is your cost structure fixed or variable? Is that where you want it to be under the circumstances? And you know there's obviously some infrastructure you're just going to have to keep and some costs you bear in that business, or are there likewise additional steps you can take there to help even out some of the drier periods? That's a very good question, Mark. There are elements of that in it.

Rohit Verma: It's a very good question, Mark. There are elements of that cost structure that are variable, and we have flexed those variables to make sure that we account for benign weather. We do have certain parts that we are still maintaining, and we're maintaining them at a relatively higher level than we could, only because we want to stay differentiated in the marketplace and stand ready. All the experts have talked about this being one of the most active weather seasons we've seen, an early hurricane, and we've seen a second one come through. There's another system developing on the back. We just don't want to be caught flat-footed when serving our clients.

Operator: Ladies and gentlemen, as a reminder, if you would like to ask a question, please press star 1 on your telephone keypad. Your next question comes from Kevin Steinke from Barrington Research. Please go ahead. Good morning.

Kevin Steinke: Good morning. Thank you. Bye, Kevin. Hello.

Kevin Steinke: I think you may have touched on this a bit, Bruce, but you had flat revenues in North America loss adjusting, but still a pickup in operating earnings year over year. Could you speak to that a little bit more? Any factors that might have helped drive that?

Bruce Swain: Yeah, I think you know, we've seen good growth in the GTS business, and that's attracted good margins. The North America loss adjusting businesses, you know, are comprised of GTS. And we also have, you know, what we call field operations, and they were able to manage their costs well in light of some volatility with weather-related claim referrals as well. So, you know, an improvement in profitability, but their operating margin for the quarter at six and a half percent is pretty good considering the weather, but it's not where we want it to be ultimately, so still a little work to do.

Bruce Swain: Okay, any specific work you need to do there, or is it just a matter of, you know, kind of the weather-related impact?

Bruce Swain: I think it's weather-related primarily, you know as we bring on new GTS adjusters, as Rohit was mentioning earlier, there is a little bit of a ramp period there before they kind of reach their peak profitability, but no, I don't think there's anything really structurally we need to do in the North American legal system.

Kevin Steinke: Okay, thanks. And as I look at the trended network revenue for the third quarter quarter over the last three years, third quarter 2023. It looked like a solid quarter, but it was the lowest revenue quarter of the last, you know, three years, 21 through 23. I suppose it's hard to judge now, but it looks like maybe the comp is easing a little bit, but I suppose it's also just going to be obviously highly dependent on what sort of weather activity we have here. But just kind of any thoughts on, you know, did we have unusually strong weather events last year contributing to the third quarter, or is that maybe a little bit more normalized?

Rohit Verma: Kevin, we definitely had higher levels of activity, particularly in Q2 of last year. What that did was it filled up the available capacity at the carriers, as a result of which, more claims in Q3 that were coming into the carriers ended up getting outsourced. So that's what led to that.

Rohit Verma: We have the same set of clients still. We continue to maintain a very strong NPS with them, so we believe that if the weather activity holds, then we should start to see similar kinds of work come our way. With the two hurricanes, Debbie as well as Beryl, we believe that while the claim activity has been low, it has given enough work to the carriers to be at capacity. So if we see another weather event come through, that should push more work toward us. But as history has taught me, being in the insurance industry for a long time, never try to predict the weather until it's already happened.

Rohit Verma: Right, right. Makes sense. That's fair enough. Yeah, so, you spoke to the momentum you have in broad spire and, this sounds like you expect that to continue. Maybe again, can you just expand on what's driving the new client wins and, the sustainability of the momentum there, and what you feel might be helping drive those wins in terms of maybe competitive differentiation.

Speaker Change:

Speaker Change: Jim you have been broad spire in.

Speaker Change: It sounds like you expect that to continue.

Speaker Change: Maybe again can you just expand on what's driving the new client wins and.

Speaker Change: Sustainability.

Speaker Change: The momentum there and your what you feel might be helping drive those wins in terms of maybe competitive differentiation.

Speaker Change: Certainly look there are three factors I believe that are driving the success.

Rohit Verma: Certainly. Look, there are three factors, I believe, that are driving the success of Broadspire, first and foremost being the technology investment that we've made, which is really differentiating us in the marketplace. The second, a very focused strategy on not only growing the traditional business but also focused on the alternative insurance market, which focuses on MGAs and carriers and captives and program business. That has gotten quite a lot of traction.

Speaker Change: In broad spires first and foremost being.

Speaker Change: The technology investment that we've made which is really differentiating us in the marketplace. The second a very focused strategy on not only growing the traditional business, but also focused on the alternative insurance market, which focuses on <unk>.

Speaker Change: And carriers and captives and program business.

Speaker Change: That has gone gotten quite a lot of quite a lot of traction and then the third and final thing is the investments that we've made in training and development. We've been Onboarding, a new class of adjusters every year for the last three years or so.

Rohit Verma: And then the third and final thing is the investments that we've made in training and development. We've been onboarding a new class of adjusters every year for the last three years or so. That has really helped us maintain our staffing levels much better than what we hear in the marketplace from some of our competitors, and as a result, we can provide a lot more stability in terms of the level of service to our clients. Those are the three biggest factors that I would say have led us to growth. And again, we're not relenting on any of those three, so we believe that that should help us continue the momentum.

Speaker Change: That has really helped us maintain our staffing levels are much better than what we hear in the marketplace from some of our competitors and as a result of which working we can provide a lot more stability.

Rohit Verma: Okay, great. You referred to the staffing levels there. It sounds like that's something you're going to continue to invest in in broad spires, given the growth momentum there. Maybe, you know, speak to your ability to add staff and your attractiveness as a destination there, maybe, you know, relative to you mentioned, maybe others not staffing up as much, but any, any comment there on just the labor trends in that business?

Rohit Verma: As you know, claims in general is a market that continues to age. What we've been investing in BroadSpar is to bring in what we call very early tenure adjusters, people that may have had some experience in an allied kind of line or allied kind of industry, but not directly in claims, so bringing them in and training them from the ground up. I think what makes us attractive is the kind of benefits that we offer, the kind of culture and environment that we provide, the career opportunities, and the growth potential that people see.

Rohit Verma: Our vision statement is to be a place where experts want to be, and we believe that that's responding in the marketplace, and our actions are demonstrating that we are living that vision, and those are the reasons we believe that we're able to attract a workforce.

Rohit Verma: It feels like that business is, you know... has fully recovered from the effects of the pandemic, but maybe any trends you're seeing there in terms of a number of cases flowing, or are you starting to see maybe cases that have been delayed or coming back, any sort of backlog or trends there in medical management? Yeah, I would.

Rohit Verma: Yeah, I would say that since the second quarter of 2023, we've been seeing a recovery back to pre-pandemic levels, and I would say that right now, we're trending to be a little bit above pre-pandemic levels. It's not always easy to make that comparison, but some of that is just related to growth in our underlying business as well. So when we look at our caseload on the medical management side, we believe that we've had a full recovery on the work that we had pre-pandemic, but then the additional cases that, or additional clients that we've added are now having cases that are in line with what we would expect them to have based on the So we believe that we're fully recovered and moving well on that path.

Kevin Steinke: Okay, great. That's helpful. Thank you for taking the questions. I will turn it over to you.

Rohit Verma: Thank you. Thank you, Kevin. Always a pleasure.

Operator: And there are no further questions at this time. I will turn the call back over to Mr. Verma for closing remarks.

Rohit Verma: Thank you so much, Julie, and thank you to all our employees, clients, and shareholders for your continued commitment to Crawford & Co. Thank you very much for your time today. God bless.

Operator: Thank you for participating in today's Crawford & Co. conference call. This call will be available for replay beginning at 11: 30 a.m. ET today through 11:59 p.m. ET on September 5, 2024. The conference ID number for the replay is 332233. The number to dial for the replay is 877-674-7070. Thank you. You may now disconnect.