Q3 2025 Crawford & Co Earnings Call
Operator: Good morning. My name is Carly, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the Crawford & Company Q3 2025 Earnings Release Conference Call. In conjunction with this 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. After the speaker's remarks, there will be a question-and-answer period. Instructions will follow at that time. Should anyone need assistance at any time during this conference, please press star 0, and an operator will assist you. As a reminder, ladies and gentlemen, this conference is being recorded today, Tuesday, 4 November 2025. I would like to introduce Tami Stevenson, Crawford & Company's General Counsel.
Good morning. My name is Carli and I will be your conference facilitator. Today at this time I would like to welcome everyone to the Crawford & Company, third quarter 2025 earnings release conference call.
In conjunction with this. Call a supplementary Financial presentation is available on our website at www.colo.com under the investor relations section.
All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer period. Instructions will follow at that time. Should anyone need assistance at any time? During this conference? Please press star, then zero and an operator will assist you
Tami Stevenson: Thank you, Carly. Some of the matters to be discussed in this conference call in the supplementary financial presentation may include forward-looking statements that involve risks and uncertainties. These statements may relate to, among other things, our expected future operating results and financial condition, our ability to grow our revenues and reduce our operating earning expenses, expectations regarding our anticipated contributions to our underfunded defined benefit pension plans, collectibility of our billed and unbilled accounts receivable, 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 resource 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 results that may be implied by such forward-looking statements.
As a reminder, ladies and gentlemen, this conference is being recorded today Tuesday, November 4th, 2025. Now I would like to introduce Tammy Stevenson Crawford and companies general counsel
Thank you. Carly. Some of the matters to be discussed in this conference call in the supplementary Financial presentation may include forward-looking statements involve risks and uncertainties.
These statements May relate to among other things, our expected future operating results and financial condition.
Our ability to grow our revenues and reduce our operating earning expenses.
Expectations regarding our anticipated contributions to our under defined underfunded defined benefit pension plans. Collectibility of our bill and unbuild, accounts receivable by 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 resource and liquidity requirements. In our ability to pay dividends in the future.
Tami Stevenson: 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 day of the call or to reflect the occurrence of unanticipated events. In addition, you are reminded that operating results from any historical period are not necessarily indicative of results to be expected for any future periods. For a complete discussion regarding factors which could affect the company's financial performance, please refer to the company's Form 10-Q for the quarter ended 30 September 2025, 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. This presentation also includes certain non-GAAP financial measures as defined under SEC rules.
The company's actual results achieved in future, quarters could differ materially from 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 day of the call, or to reflect the occurrence of unanticipated events.
In addition, you are reminded that operating results from any historical period are not necessarily indicative of results to be expected for any future periods.
For a complete discussion regarding factors which could affect the company's financial performance. Please refer to the company's form 10q for the core Android September 30 2025 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: As required, a reconciliation is provided for those measures to the most directly comparable GAAP measures. I would now like to introduce Mr. Rohit Verma, CEO of Crawford & Company. Rohit.
This presentation also includes certain non-gaap Financial measures as defined under SEC rules as required. A Reconciliation is provided for those measures to the most directly comparable, gaap measures,
I would now like to introduce Mr. Wrote Verma CEO.
Rohit Verma: Thank you, Tami. Good morning, and welcome to our Q3 2025 earnings call. Joining me today is Bruce Swain, our Chief Financial Officer, and Tami Stevenson, our General Counsel. After our prepared remarks, we will open the call for your questions. Crawford & Company delivered a solid Q3 with improved operating earnings across three segments and improved margins across all segments, reflecting the strength of our diversified business lines. Broadspire and International Operations performed particularly well. Consolidated revenues came in slightly below the prior year due to the continued absence of significant weather and lower US claims activity in North America Loss Adjusting. Broadspire achieved record quarterly revenue performance with improved margins. Our International Operations delivered record revenue growth with margin expansion across key markets. Consolidated operating earnings improved significantly, up 22% year over year, reflecting the strength of our core portfolio and disciplined cost management.
Of Crawford & Company for what? Thank you, Tammy, good morning and Welcome to our third quarter 2025 earnings call. Joining me today is Bruce Wayne our Chief Financial Officer and Tammy Stevenson our general counsel.
After our prepared remarks, we will open the call for your questions.
Crawford and Company delivered, a solid third quarter with improved operating earnings across 3 segments, and improve margins, across all segments, reflecting the strength of our Diversified business lines.
Broadspire and international performed particularly well, Consolidated, revenues came in slightly below the prior year due to the continued absence of significant weather and lower us claims activity in North America lost adjusting.
Broadspire achieved record quarterly Revenue performance with improved margins and international operations, delivered record. Revenue growth with margin expansion, across key markets,
Rohit Verma: This morning, I'll review our segment operations for Q3 before handing it over to Bruce for a deeper dive into our financial performance. Crawford & Company combines global scale with deep expertise to tackle the widest variety of claims anywhere in the world. Operating in over 70 countries with a team of 10,000 professionals, we have the capability to manage claims of any size or complexity. Each year, we handle billions of USD in claims, underscoring the confidence that top insurers, corporations, and public entities place in our services. Our expertise, experience, and technical knowledge enable us to deliver solutions across diverse markets, while our global footprint allows us to establish and sustain strong relationships with clients navigating increasingly complex risks. This unique combination of scale, skill, and reliability provides a clear competitive advantage in the claims management industry.
Consolidated, operating earnings, improved significantly up 22% year-over-year reflecting the strength of our core portfolio and discipline cost management.
This morning, I'll review our segment operations for the third quarter before handing it over to Bruce for a deeper dive into our financial performance.
Profit and Company combines global scale with deep expertise, to tackle the widest variety of claims anywhere in the world.
Operating in over 70 countries with a team of 10,000 professionals. We have the capability to manage claims of any size or complexity.
Each year, we handle billions of dollars in claims underscoring, the confidence that top insurers corporations and public entities, place in our services.
Our expertise.
Experience and Technical knowledge. Enable us to deliver Solutions across diverse markets. While our Global footprint allows us to establish and sustain strong relationships with clients, navigating increasingly complex risks.
Rohit Verma: With over eight decades of experience, Crawford has continually evolved its business model to address the increasingly complex and dynamic claims environment. Our growth trajectory is supported by a set of long-term drivers that position us to create sustainable value. First, severe weather events around the world create opportunities for Crawford's weather-related services. Our scale and expertise enable us to respond quickly and effectively, providing support to carriers when claims are most urgent. We have diversified Crawford's model with a multi-line, multi-geography approach, which allows us to balance performance across economic as well as weather cycles to create a strong foundation for consistent profitability and long-term value creation. US carriers increasingly seek established, reliable partners, Crawford is well-positioned with our focus on operational excellence, our scale, and our specialized expertise to grow our market share in a fragmented space.
This unique combination of scale skill and reliability provides a clear competitive advantage in the claims management industry.
With over 8 Decades of experience. Crawford has continually evolved its business model to address the increasingly complex and dynamic claims environment.
Our growth trajectory is supported by a set of long-term drivers that position us to create sustainable value.
First severe, weather events around the world, create opportunities for Crawford's, weather related services.
Our scale and expertise enable us to respond quickly and effectively providing support to carriers when claims are most urgent.
We have Diversified Crawford's model with a multi-line multi- geography approach, which allows us to balance performance across economic as well as weather Cycles.
To create a strong foundation for consistent profitability, and long-term value creation.
US carriers, increasingly seek established, reliable partners. And Crawford, is well, positioned with our focus on operational. Excellence our scale and our specialized expertise to grow our market share in a fragmented space.
Rohit Verma: Across all business segments, we continue to expand and deepen relationships with key clients and partners. These partnerships enhance cross-segment opportunities, generate new business, and reinforce our position as a trusted partner for complex claims management solutions globally. Finally, Crawford's combination of specialized knowledge and advanced technology platforms strengthens both efficiency and client outcomes. By leveraging proprietary systems, automation, and data analytics, we enhance service quality and further differentiate ourselves in the marketplace. Turning to our quarterly results, Crawford & Company delivered a solid performance this quarter. Consolidated revenues were slightly lower than Q3 2024, primarily due to reduced US property claims activity. Operating earnings grew 22% year over year, with margin expansion across all 4 segments, demonstrating the benefits of our diversified business model and ongoing initiatives to improve operation efficiency.
Across all business segments, we continue to expand and deepen relationships with key clients and partners.
These partnerships enhance cross-segment opportunities, generate new business, and reinforce our position as a trusted partner for complex claims management solutions globally.
Finally, Crawford's combination of specialized knowledge and advanced technology platforms, strengthens, both efficiency and client outcomes.
By leveraging proprietary systems, Automation and data analytics. We enhance service quality and further differentiate ourselves in the marketplace.
Turning to our quarterly results, Crawford, and Company delivered, a solid performance. This quarter
Consolidated revenues were slightly lower than in the third quarter of 2024, primarily due to reduced U.S. property claims activity.
Rohit Verma: This quarter, we saw continued momentum at Broadspire, which delivered a record quarterly revenue performance, contributing meaningfully to revenue and margin growth. International Operations also had a record quarter, expanding both top-line results and margin across key segments. Revenue for North America Loss Adjusting and Platform Solutions was impacted by the absence of significant weather events and lower US claims activity. Our North America Loss Adjusting business saw strong operating earnings growth, thanks to the operational efficiency and solid performance from the U.S. Global Technical Services business. non-GAAP EPS was $0.32 for both CRDA and CRDB, and the company paid a quarterly dividend of $0.075 per share. In Q3, we added $29 million in new business, reflecting the continued strength of our pipeline and the depth of our client relationships.
however, operating earnings grew, 22% year-over-year with margin expansion, across all 4, segments, demonstrating the benefits of our Diversified business model, and ongoing initiatives to improve operational, efficiency,
This quarter we saw continued momentum at broadspire which delivered a record. Quarterly Revenue performance contributing meaningfully to revenue and margin growth.
International operations. Also had a record quarter expanding both Topline results and margin across key segments.
Revenue for North America Los adjusting and platform Solutions was impacted by the absence of significant weather events and lower us claims activity, but our North America, Los adjusting business. So strong operating earnings growth. Thanks to the operational, efficiency and solid performance from the US Global Technical Services business.
Non-gaap EPS was 32 cents for both crda and crdb, and the company paid a quarterly dividend of 7 7 and a half cents per share.
Rohit Verma: This takes our total new business added in the year to $78 million. Our strong balance sheet and liquidity remain key strengths, providing the foundation for our continued investment in growth initiatives. The leverage ratio remains low at 1.64 times EBITDA, reflecting disciplined capital management and cash flow generation. We have a disciplined approach to capital deployment with focus on long-term growth through strategic initiatives, including targeted M&A, acqui-hires to expand capabilities, and ongoing capital expenditures. We remain committed to returning capital to shareholders. In addition to the dividend, we opportunistically repurchase shares. In Q3, we repurchased over 275,000 shares of CRDA and CRDB.
In the third quarter, we added 29 million in new business reflecting the continued strength of our Pipeline and the depth of our client relationships.
This Stakes are total new business added in the year to 78 million.
The leverage ratio remains low at 1.64 times ibida reflecting disciplined Capital Management and cash flow generation.
We have a disciplined approach to Capital deployment, with focus on long-term growth, through strategic initiatives, including targeted m&a, acquires to expand capabilities and ongoing Capital expenditures.
We remain committed to returning Capital to shareholders. In addition to the dividend we opportunistically repurchase shares.
Rohit Verma: Subsequent to the close of the quarter, our board of directors authorized the addition of 2 million shares of common stock to the stock repurchase program and extended the program termination date to 31 December 2027. With that, let me turn the call over to Bruce for a deeper look at our segment operational and financial performance.
in the third quarter, we repurchase over 275,000 shares of crda and crdb
and subsequent to the close of the quarter. Our board of directors authorized, the addition of 2 million shares of common stock to the stock repurchase program, and extended the program. Termination date through December, 31st 2027
W. Bruce Swain Jr.: Thank you, Rohit. Crawford operates through our four core segments that represent the global reach of our business. North America Loss Adjusting, which includes our loss adjusting operations in the US and Canada, accounted for 24% of Q3 2025 revenues. International Operations, covering all service lines outside North America, contributed 35% of quarterly revenues. Broadspire, our US-based third-party administration business, represented 32% of quarterly revenues. Platform Solutions, which includes Contractor Connection, networks, and subrogation services, accounted for 9% of revenues. In North America, loss adjusting revenue decreased 2.9% year over year, primarily reflecting lower significant weather and property claim activity in the US. Despite the revenue headwind, operating earnings increased 28% compared to the prior year, driven by strong performance in our GTS business and improvements in our Canadian operations.
With that, let me turn the call over to Bruce for a deeper. Look at our segment, operational and financial performance.
Thank you. Rohit Verma operates through our four core segments that represent the global reach of our business: North America and Loss Adjusting, which includes our loss adjusting operations in the U.S. and Canada.
2025 revenues International operations covering all service lines outside North America. Contributed 35% of quarterly revenues and broadspire, our us-based third-party administration business represented, 32% of quarterly revenues.
Platform Solutions, which includes contractor connection networks and subrogation Services accounted for 9% of revenues.
In North America, Los adjusting Revenue, decreased 2.9% year-over-year primarily reflecting lower significant weather and property claim activity in the US, despite the revenue headwind, operating earnings increased 28%, compared to the prior year driven by strong performance in our GTS, business and improvements in our Canadian operations.
W. Bruce Swain Jr.: Operating margins expanded 215 basis points, reflecting both mix shift towards higher margin services and ongoing operational efficiencies. North America Loss Adjusting continues to attract top-tier insurance adjusting talent, a key competitive advantage in delivering expertise and high-quality service to our clients. With our current visibility, we expect the lower claims activity to persist through Q4 2025. However, we anticipate a return to more typical claims activity over the coming 12 to 18 months. International Operations showed continued momentum, with revenue growth of 6.7% and operating earnings increasing 45% year over year. Improvements were driven by a combination of weather-related claims in Australia and Asia and new client wins, demonstrating the segment's ability to capture opportunities across key regions, including the UK, Europe, Asia, and Australia.
Operating margins expanded 215 basis points reflecting both the mixed shift towards higher margin services and ongoing operational efficiencies.
North America, Los adjusting continues to attract top, tier Insurance, adjusting Talent, a key competitive advantage, in delivering, expertise, and high-quality service to our clients.
With our current visibility, we expect the lower claims activity, to persist through the fourth quarter of 2025. However, we anticipate a return to more typical claims activity over the coming 12 to 18 months,
International operations, showed continued, momentum with Revenue, growth of 6.7% in operating earnings increasing 45%. Year-over-year improvements were driven by a combination of weather related claims in Australia and Asia and new client wins demonstrating the segments of ability to capture opportunities across key regions, including the UK, Europe, Asia, and Australia.
W. Bruce Swain Jr.: Operating margins expanded 174 basis points, reflecting disciplined execution, efficient operations, and strong pricing. We're pleased with the continued progress in our international business as we capitalize on our recognition as a trusted partner capable of delivering expertise and consistent results for insurers and corporations worldwide. We anticipate some moderation in Q4 related to the absence of one-time benefits we realized in Q4 2024, the underlying long-term trajectory of the business remains strong. Broadspire delivered record quarterly revenues of $103.4 million in Q3, reflecting year-over-year growth of 4.4%. Operating earnings increased 8.1% and operating margins expanded 51 basis points, reflecting the segment's scale, efficiency, and consistent execution.
Operating margins expanded 174 basis points reflecting disciplined execution, efficient operations, and strong pricing.
We're pleased with the continued progress in our international business, as we capitalize on our recognition, as a trusted partner capable of delivering expertise, and consistent results for insurers and corporations worldwide.
we anticipate some moderation in the fourth quarter related to the absence of 1-time benefits we realized in the fourth quarter of 2024, but the underlying long-term trajectory of the business remains strong
W. Bruce Swain Jr.: Client retention remains strong at 93.5%, underscoring the trust and long-term relationships Broadspire has built across its customer base. Our new business pipeline is robust. These results reflect Broadspire's growing leadership position in the TPA market and its critical role in Crawford's growth strategy. Platform Solutions experienced a challenging quarter, with revenues down 36% year-over-year due to ongoing weather-related declines in the CAT and Contractor Connection business lines. Operating earnings decreased 33% compared to the prior year, although operating margins improved by 47 basis points, reflecting our progress in managing cost and improving efficiencies. On this slide, you can see the decline in storm activity, which continues to impact results for our North America Loss Adjusting and Platform Solutions segments. In Q3, storm activity was down 35% year-over-year, contributing to a 16% decline in weather-related revenue.
Ross bar delivered record quarterly revenues of 103.4 million in the third quarter reflecting year-over-year. Growth of 4.4%, operating earnings increased 8.1% in operating margins expanded. 51 basis points reflecting the segment scale, efficiency and consistent execution.
Client retention remains strong at 93.5% underscoring the trust and long-term relationships broadspire is built across its customer base and our new business pipeline is robust these results. Reflect broadspire growing leadership position in the TPA market and its critical role in Crawford's growth strategy.
Platform Solutions, experienced the challenging quarter with revenues down 36% year-over-year due to ongoing weather related declines in the cat and contractor connection business lines.
Operating earnings, decrease 33% compared to the prior year. Although operating margins improved by 47 basis points, reflecting our progress and managing cost and improving efficiencies.
On this slide, you can see the decline in storm activity, which continues to impact results. For our North America, Los adjusting and platform Solutions,
W. Bruce Swain Jr.: At the same time, our non-weather business delivered revenue growth of 3.4%, highlighting the resilience of our diversified model and the ability to partially mitigate volatility in weather-dependent segments. The reduced frequency of US property claims continues to reflect market dynamics, including affordability considerations and higher deductibles. As the broader insurance market stabilizes, we expect weather-related claims activity to return to more typical levels over the next 12 to 18 months. Meanwhile, the strength of our non-weather businesses, including Broadspire and International Operations, continues to provide steady revenue and earnings support, demonstrating the value of our multi-line, multi-geography model. For a look at our consolidated results. In Q3 2025, company-wide revenues before reimbursements were $322.2 million, a decrease of 2.2% compared to the prior year period.
In the third quarter storm activity was down 35% year-over-year contributing to a 16% decline in weather related Revenue.
At the same time, our non-weather business delivered Revenue, growth of 3.4% highlighting the resilience of our Diversified model and the ability to partially mitigate volatility in weather dependent segments.
The reduced frequency of us property, claims continues to reflect market dynamics, including affordability, considerations and higher deductibles as a broader Insurance Market stabilizes. We expect weather related claims activity to return to more typical levels over the next 12 to 18 months.
Meanwhile, the strength of our non-weather businesses, including broadspire and international operations, continues to provide steady revenue and earnings support, demonstrating the value of our multi-line, multi geography model.
and now, for a look at our Consolidated results,
W. Bruce Swain Jr.: Foreign exchange rates increased revenues before reimbursements by $3.4 million or 1.1%. GAAP net income attributable to shareholders totaled $12.4 million, compared to $9.5 million in the same period of 2024. GAAP diluted EPS in Q3 2025 was $0.25 for both CRDA and CRDB, an increase from $0.19 for both share classes in the 2024 period. On a non-GAAP basis, diluted EPS was $0.32 for both CRDA and CRDB, increasing from $0.22 for both share classes in the prior year period. The company's non-GAAP operating earnings totaled $26.6 million in Q3 2025, or 8.3% of revenues, compared to $21.8 million, or 6.6% of revenues in the prior year period.
Reimbursements by 3.4 million or 1.1%.
Gaap, net income attributable, to shareholders, total 12.4 million compared to 9.5 million in the same period of 2024.
Gap diluted EPS in the 2025 third quarter was 25 cents for both crda and crdb an increase from 19 cents for both share classes in the 20124 period.
On a non-GAAP basis, diluted EPS was $0.32 for both CRDA and CRDP, increasing from $0.22 for both share classes in the prior year period.
W. Bruce Swain Jr.: Consolidated adjusted EBITDA was $36.3 million in Q3 2025, or 11.3% of revenues, increasing from $29.6 million, or 9% of revenues in Q3 2024. The company's cash and cash equivalents as of 30 September 2025 totaled $68.8 million, compared to $55.4 million at 31 December 2024. Total receivables were $263.3 million as of 30 September 2025, down $9.8 million from the 2024 year-end. The company's total debt outstanding as of 30 September 2025 totaled $218.1 million, consistent with total debt outstanding as of 30 September 2024.
The company's non-gaap operating earnings total 26.6 million in the 2025 third quarter or 8.3% of revenues compared to 21.8 million or 6.6% of revenues. And the prior year period
Consolidated adjusted ibao was 36.3 million in the 2025 third quarter or 11.3% of revenues, increasing from 29.6 million or 9% of revenues in the 2024 quarter.
The company's cash and cash equivalents, as of September 30th, 2025 totaled, 68.8 million, compared to 5 5, 5. 4, 2 4.
Total receivables were 263.3 million. As of September, 3025 down 9.8 million from the 2024 year end.
the company's total debt outstanding as of September 3022 total 218.1 million consistent with total debt outstanding as of September 30th 2024
W. Bruce Swain Jr.: Net debt was $149.3 million as of 30 September 2025, while our U.S. pension liability was $20.4 million, reflecting a funded ratio of 93.1%. We made no discretionary contributions to our U.S. defined benefit pension plan during Q3 2025, and we do not intend to make contributions through the remainder of the year. Operating cash flow through Q3 2025 was $51.7 million, with free cash flow of $24.1 million. This compares to $11.1 million in operating cash flow last year, with free cash flow of -$18.4 million. The significant improvement in operating and free cash flow in the 2025 year-to-date period was primarily due to improved earnings and improvement in working capital levels.
Net debt was 149.3 Million. As of September 3020 while our us, pension liability, was 20.4 Million reflecting a funded ratio of 93.1%.
We made no discretionary contributions to our us defined benefit Pension Plan during the third quarter of 2025 and we do not intend to make contributions through the remainder of the year.
Operating cash flow through the third quarter of 2025 was 51.7 million with free cash flow of 24.1 million. This compares to 11.1 million in operating cash flow last year with free cash flow of negative. 18.4 million the significant Improvement in operating in free cash flow in the 2025 year to date. Period was primarily due to improved earnings and Improvement in working capital levels.
W. Bruce Swain Jr.: Unallocated corporate costs were $5.9 million in Q3 2025, compared to costs of $7 million in the 2024 period. The decrease was due to lower professional fees and non-recurring items, partially offset by higher self-insured medical costs. During Q3 2025, non-service pension costs were $2.4 million, consistent with the same period of 2024. We recognized pre-tax continuing earnout cost of less than $100,000 in Q3 2025 compared to a credit of $2.1 million in the 2024 period. During Q3 2025, the company repurchased approximately 275,000 shares of CRDA and CRDB. As Rohit mentioned, we are increasing our share repurchase authorization with the addition of 2 million shares.
Unallocated corporate costs were 5.9 million in the 2025 third quarter compared to cost of 7 million in the 2024 period.
The decrease was due to lower professional fees, and non-recurring items, partially offset by higher self-insured medical cost.
During the 2025 third quarter non-service, pension costs were 2.4 million consistent with the same period of 2024.
We recognized pre-tax continuing our out cost of less than 100,000 in the 2025. Third quarter compared to a credit of 2.1 million in the 2024 period.
W. Bruce Swain Jr.: As a result, approximately 2.8 million shares are eligible to be repurchased under our 2021 share repurchase authorization. With that, I'll turn the call back over to Rohit for concluding remarks.
During the third quarter of 2025 the company. Repurchased, approximately 275,000 shares of crda and crdb as mentioned, we are increasing our share repurchase authorization with the addition of 2 million shares and as a result approximately 2.8 million Shares are eligible to be repurchased under our 2021 Cherry purchase authorization.
Rohit Verma: Thank you, Bruce. Crawford delivered a solid Q3 with strong earnings improvement as our diversified model continues to provide stability through weather and market fluctuations. We remain focused on investing in long-term growth while returning capital to shareholders. Our balance sheet and low leverage ratio provide us the financial flexibility to explore opportunities while maintaining our commitment to the dividend and share repurchase programs. As Bruce mentioned, in looking forward the close of this year, we expect the continued absence of significant weather events and lower US claims activity to impact results. We anticipate that Q4 2025 revenue will not repeat the $30 million revenue lift we saw in last year's Q4 from Hurricanes Helene and Milton, which will make for a difficult comparison of Q4 2025 to Q4 2024.
With that, I'll turn the call back over to Rowan for concluding remarks.
Thank you, Bruce Crawford delivered, a solid third quarter with strong, earnings Improvement at the Diversified model continues to provide stability through weather and Market fluctuations.
We remain focused on investing in long-term growth, while returning Capital to shareholders and our balance sheet and low, leverage ratio provided the financial flexibility to explore opportunities. While maintaining our commitment to the dividend and share repurchase programs.
As Bruce mentioned in looking forward.
The close of this year. We expect the continued absence of significant weather events and lower us claims activity to impact results.
Rohit Verma: Moving forward, we remain focused on the elements of our business that we can control, achieving operational efficiency, delivering quality customer service, winning new clients, and expanding our business with existing customers. We remain committed to creating long-term value through a balanced approach to investment, cost discipline, and returning capital to shareholders. Thank you for your time today. Carly, please open the call for questions.
We anticipate that fourth quarter, 2025 Revenue will not repeat the 30 million Revenue lift. We saw in the last year's fourth quarter from Hurricane Selen and Milton, which will make for a difficult comparison of Q4 2025 to Q4 2024.
Moving forward. We remain focused on the elements of our business that we can control achieving operational, efficiency, delivering quality, customer service, winning new clients and expanding our business with existing customers.
To investment cost discipline and returning Capital to shareholders.
Thank you for your time today Carly. Please open the call for questions.
Operator: At this time, if you would like to ask a question, please press star then the 1 on your telephone keypad. To withdraw your question, press the pound key. If you are using a cellphone, pick up your before asking your question. Pause for just a moment to compile the Q&A roster. Your first question comes from the line of Mark Hughes with Truist.
At this time, if you would like to ask a question, please press star. Then the number 1 on your telephone keypad to draw. Your question, is the pound key. If you're using a phone pick up your
For just a moment to compile. The Q&A roster.
Your first question comes from the line of Mark Hughes with truist.
Mark Hughes: Yeah, thank you very much. Good morning.
Rohit Verma: Hey, good morning, Mark.
Yeah, thank you very much. Good morning.
W. Bruce Swain Jr.: Morning, Mark.
Mark Hughes: The North America Loss Adjusting margin seems like it's pretty strong with a top-line decline. How much of that was a mix shift? You talked about the GTS in Canada. I know you've been pursuing more long-term operational efficiencies. How sticky is that better margin there?
Hey, good morning, Mark morning Mark.
The uh North American loss, adjusting margin seems like it was pretty strong with the Top Line decline. Um how much of that was mixed shift? You talked about the GTS in Canada. Um, I know you've been pursuing more. Long-term operational efficiencies how sticky is that? Uh, better margin there.
Rohit Verma: Mark, if you think about the business, as you rightly pointed out, it really has three component parts to it. We've got in the US our large and complex business, which we call our Global Technical Services. We have our field operations business and then obviously Canada. Our large and complex business continues to do well. As a matter of fact, on a full year basis, that business is growing. If you look at on a year-to-date basis as well, that North America Loss Adjusting has a slight growth about 1% for the full year. The weakness that we're seeing is in our smaller size, or I would say, residential claims activity. Depending on the, you know, the quarter, that can have a strong bearing.
Mark, if you, if you think about the business as you rightly pointed out, it really has 3 component parts to it, we've got in the US, our our large and complex business, which we call our Global Technical Services, we have our field operations business and then obviously Canada.
Rohit Verma: Typically in Q3, we have higher residential claims activity that's coming from both severe convective storms as well as hurricanes. We did not see that as a result of which the mix was more towards the large and complex side, and you saw a better margin. We continue to grow our large and complex side. Like I said, it's grown this year already despite the no real weather activity. We believe that as that business continues to grow and takes a bigger hold in the portfolio, we should see an continued improvement in the margin. We're seeing the margins in that business stick, in fact, to some extent, getting better. For our large and complex, that is.
Um, our large and complex business continues to do well, as a matter of fact on a full year basis, that business is growing. And if you look at uh, on a year-to-date basis as well that North America, Los adjusting, um, has a slight growth about 1% for the full year. The weakness that we're seeing is in our, um, smaller size, or I would say residential claims activity and depending on the, you know, the quarter back and that can have, uh, a strong bearing. So, typically in Q3 we have higher residential claims activity that's coming from both severe convective storms as well as hurricanes. We did not see that as a result of which the mix was more towards the large and complex side and you saw a better margin. Um, we continue to grow our large and complex side, like I said, it's grown this year already despite the no, no real weather activity so we believe that as that business continues to grow and takes a bigger, hold in the portfolio. We should see um, and continued improvement improvement in the margin. We're seeing that seeing the margins in that business.
Mistake, in fact, uh, to some extent getting better.
For our large and complex, that is.
Mark Hughes: Yeah, very good. You had made an interesting point last quarter about higher insurance costs, higher deductibles, fear about insurance companies raising rates if consumers report a claim that that was depressing some of these residential claims like you might have assumed in Q3. Any update on that point?
Yep, very good. Um, you had made an interesting point, last quarter about higher Insurance costs, higher deductibles
Rohit Verma: I think, Mark, what we're seeing is sort of a duality where you're seeing the commercial lines, the rate adequacy is starting to get passed to the customers. You're actually seeing rate declines that are going to customers on the commercial side, and we believe that claims activity there has resumed to normal other than, of course, the lack of activity from weather. On the residential side, we still don't see that being passed on to the consumer. I don't know how your property insurance looks like, but my home insurance just continues to grow, go up. Really it's starting to turn more into CAT cover. Historically, if you look at insurance markets-
Fear about, uh, insurance companies. Raising rates if, uh, consumers report a claim that that was suppressing some of these uh, residential claims like, you might have assumed in 3 Q. Any update on that uh, point.
yeah, I think Mark what we're seeing is uh, is sort of a duality where you're seeing the
Mark Hughes: Yeah
Rohit Verma: once the carriers achieve rate adequacy, one of the carriers does go out and starts to discount, then eventually the market follows. Our belief still is, as Bruce mentioned in his remarks, that in 12 to 18 months, we should start to see the deductibles come down and normal claims activity resume. We have not seen that happen yet, despite a view that the property market has achieved rate adequacy.
Commercial lines. The, uh, the rate adequacy is starting to get passed to the customers. They're actually seeing rate declines that are going to customers on the commercial side. And we believe that claims activity, there has resumed to normal other than of course the lack of activity from weather. On the residential side, we still don't see that being passed on to the consumer. I don't know, um, how your property insurance looks like, but my home insurance, just continues to grow, go up. Uh, and really, it's starting to turn more into cat cover, historically, if you look at Insurance markets once the once, the carriage is achieved rate, adequacy, 1 of the carriers, does go out and starts to Discount and then eventually the market follows. So our belief still is as Bruce mentioned in his remarks that in 12 to 18 months, we should start to see the deductibles come down and normal claims activity resumed. But we have not seen that happen, yet despite uh a view that uh the property Market has achieved rate adequacy
Mark Hughes: Yeah. The International Operations margin was also up. Was that just an incremental flow-through from weather claims? Was there GTS impact there as well?
yeah, the uh International margin was also up was that uh just incremental
Rohit Verma: International, as you know, has been an important push for us from both growth as well as profitability perspective, and the main focus being on profitability. There was definitely weather. In Q3, we saw weather in Australia. We saw weather in UK, and then we had seen weather in Europe in the earlier part of the year. That is still sort of flowing through the system. Again, our target is to get International to a 10% margin in the medium to long term, and that is the journey we're on. As we've shared with you before, we will see probably quarterly fluctuations because of weather and other cyclicality reasons in our business, our trend is to keep moving International up.
flow through from weather claims was that was their GTS impact there as well.
International up.
Mark Hughes: Yeah. Any more you can say about the business pipeline in Broadspire? Is this your sales initiatives? Is there just a little more movement in the market? What is contributing to that?
Yeah, and then any more you can say about the business pipeline and broadspire, is this your sales initiatives? Uh, is there just a little more movement in the market?
Rohit Verma: Yeah. We had actually seen a slowdown in the RFP activity in Q2. We've kind of seen that pick back up in Q3. As you know, the sales cycles on this business are long, we've been growing at a nice clip. I think this quarter, we reported almost 4% growth. I think for the full year, we're still looking at or I should say year to date, the 9 months, we're looking at, you know, somewhere around that 3% to 4% as well. That's the kind of growth that we expect to continue seeing on an organic basis. Margins are healthy. Margins improved this quarter. I think you'll recall that last quarter we had a discussion about a slight drop in margins. It was about 50 or 70 basis points, I think.
um, what is uh, contributing to that
You know, we had actually seen a Slowdown in the RFP activity.
As you know, the sales Cycles on this business are long. But uh we've been growing at a nice clip I think uh this quarter we reported almost 4% growth. I think for the full year we're still looking at or I should say year to date the 9 months, we're looking at, you know, somewhere around that 3 to 4% as well.
Rohit Verma: We had said that, you know, that's within the realm of tolerance. We continue to invest in that business. We believe there is still a strong trajectory for that business and expect that business to continue growing as the months and quarters go by.
That's the kind of growth that we expect to continue seeing on an organic basis but margins are healthy margins improved, this quarter. I think you you'll recall that last quarter. We had a discussion about a slight drop in margins. It was about 50 or 70 basis points, I think. And we had said that, you know, that's within the within the realm of tolerance. So we continue to invest in that business. We believe there is still a strong trajectory for that business and and expect that business to continue growing. Um, as uh,
As the months and quarters go by.
Mark Hughes: Appreciate that. Thank you.
Appreciate that. Thank you.
Rohit Verma: Thank you, Mark.
Thank you, Mark.
Operator: Your next question comes from the line of Kevin Steinke with Barrington Research.
Your next question comes from the line of Kevin Stein key with bington research.
Kevin Steinke: Great. Thank you. Good morning.
W. Bruce Swain Jr.: Hey, good morning, Kevin.
W. Bruce Swain Jr.: Hi, Kevin.
Uh great. Thank you. Good morning.
Kevin Steinke: I wanted to start off continuing this discussion on the insurance affordability. It sounds like you're not seeing that in your international markets. It's just kind of a US specific only at this point. Is that correct?
I wanted to start off uh, continuing this discussion on the uh,
Rohit Verma: We believe that it is a phenomenon that we are seeing more in the US market. We did see that in the international markets, but they recovered, you know, far more quickly than what we've seen in the US.
Insurance affordability. Um it sounds like you're not you're not seeing that uh in your International markets. It's just kind of a us uh specific only at this point. Is that correct?
We we believe that it is uh it it is a phenomenon that we've seen. We are seeing more in the US market. We did see that in the in the international markets but they recovered a, you know, far more quickly than what we've seen uh in the US.
Kevin Steinke: Okay. Thanks. You talked about the Broadspire margin there. You had a nice ramp up sequentially. You talked about last quarter, kind of the bandwidth that you would expect those margins to remain in. You know, I'm just wondering if there's anything specific that helped the margin sequentially in Q3 versus Q2. You know, if that was just more revenue ramping up or if there are any, you know, cost items to call out there.
Okay.
Thanks and you you talked about the broadspire margin there, you had a nice ramp up sequentially. Um and yeah, you talked about last quarter, kind of the the bandwidth that you would expect those margins to remain in. But you know, this is just wondering if there's anything specific that helped the margins sequentially in the
Rohit Verma: Not really, Kevin. I think we had mentioned that we always try to hire for Broadspire in advance so that as the clients are coming on, we know when the clients are coming on, so sometimes, you know, they straddle quarter boundaries. We will see that we've taken the cost on a little bit sooner than what the revenue is coming in just because of the straddling without those boundaries. We feel very good about the Broadspire business, and we believe that, you know, we will continue to see growth. I think the margin will remain in this band because we still believe there is room for investment in that business from a technology perspective. We believe that AI can be a major enabler in that business rather than a disruptor for us.
Not, not really Kevin. I think we had mentioned that, uh, we had we always try to hire for broad spine in advance so that as the clients are coming on, we know when the clients are coming on. So sometimes the, you know, they straddle quarter boundaries so we will see that we've taken the cost on a little bit sooner than what the revenue is coming in. Just because of the straddling, over the those boundaries,
Rohit Verma: We are identifying opportunities where we can deploy AI. In the short term, we might see some more capital expense going into that business and/or some more investment going in that business. Longer term, I think it should just continue to help the margins and make it an important contributor to profitability for the company.
We're not, we feel very good about the broadspire business, and we believe that, you know, we will continue to see growth. I think the margin will remain in this band because, um, we still believe there is room for investment in that business from a technology perspective, we believe that AI can be a major enabler in that business rather than a disruptor for us. And uh, and we are identifying opportunities where we can deploy AI. So, in the short term we might see some more Capital expense going into that business and or somewhere investment going in that business. But longer term, I think it should just continue to help the margins and make it an important contributor to profitability for the company.
Kevin Steinke: Okay, good. Yeah, I thought it was interesting or somewhat impressive that, you know, the last couple quarters, you know, particularly this quarter with the significant decline in Platform Solutions revenue related to, you know, weather events and insurance affordability. Despite that revenue decline, you actually improved the margin year over year for Platform Solutions. Can you kind of talk about how you were able to accomplish that?
Okay good. Um,
yeah, I thought it was, uh, interesting or or uh, if someone impressive that, you know, the last uh,
Rohit Verma: You know, some of that, as we've talked about before, is a little bit of a mix shift. We've got, as you know, there are really three predominant businesses in there. We've got a catastrophe business, our subrogation business, which goes by the name of Praxis, and our Contractor Connection business. The catastrophe business, as the name suggests, is to serve clients during the times of catastrophe. That usually creates big revenue, the margin profile on that is not the same as the margin profile in the other two businesses. When there's a mix shift, we tend to see the margin improve because of the mix shift.
You know, some of that.
Rohit Verma: Ideally, we would like to see this business grow, and we believe that as, you know, normal, claims reporting patterns resume and normal weather patterns resume, we will start to see this business come back up.
Our normal, um, claims reporting patterns resume, a normal weather patterns resume, we will start to see this business, uh, come back up.
Kevin Steinke: Okay, great. Bruce, you had called out for International related to Q4, some one-time benefits in the year ago quarter. I have in my notes here that you had a one-time tax benefit that helped you in the year ago quarter on the margin in International. Is there anything else that we should be aware of there?
Okay, great. Um,
W. Bruce Swain Jr.: The tax benefit is one item. You know, last year, at the end of the year, we had some pretty significant revenue in our Middle East business related to floods that had occurred earlier in the year. We also had some higher revenues in Asia, particularly in Taiwan, related to some earthquake claims, and had some flooding losses in Latin America. You know, those kind of four items, when you bunch in the tax benefit, kind of equally contributed to the outperformance in last year's Q4. We just don't expect that to repeat, notwithstanding the fact that we still expect the, you know, international results, you know, trajectory to remain strong.
Bruce you had called out for international uh related to the fourth quarter. Some some uh 1-time benefits in the year ago quarter. I I I have in my notes here that you had a 1-time tax benefit that helped you in the year ago quarter on the the the margin and international. But is there anything else um that that we should we should be aware of their
Yeah, the tax, the tax benefit is 1 item. You know, last year, at the end of the year, we had, uh, some pretty significant Revenue in our mid Middle East business related to floods that had occurred earlier in the year. Uh, we also had, uh, some higher revenues in in Asia. Uh, particularly in entire, uh, Taiwan related to some earthquake, Quake claims and had, uh, some flooding losses and, uh, in Latin America. So, you know, those kind of 4 items when you bunch in the, the tax benefit, um,
W. Bruce Swain Jr.: But it's just not going to be the same early result as we had last year.
Um, kind of equally contributed to the the outperformance in last year's fourth quarter, and we just don't expect that to to repeat notwithstanding. The fact that we we still expect the, you know, International results, you know, trajectory to remain to remain strong and uh,
But it's just not going to be, um, the same quarterly result as we had last year.
Kevin Steinke: Okay, understood. That's helpful. In relation to the increase in the share repurchase authorization, maybe just, you know, talk about how active you expect to be there, and kind of the rationale you see for continuing to repurchase shares.
Okay, understood. That's, that's helpful. Um, and and the relation to the, uh,
increase in the the share repurchase authorization maybe just uh
You know, talk about, um, uh, how active you expect to be there? Uh, and, uh,
W. Bruce Swain Jr.: Sure, you know, we think of our shares as trading well below their intrinsic value, and it's, you know, recognized by the, by the board as well. We have kind of an open market share repurchase plan that we execute on. You know, kind of given the trading volumes that we have, you don't see, you know, hugely significant amounts that are being repurchased. In this last quarter, it was 275,000 shares. In the absence of any large blocks or significant changes in the trading volume, that's probably about the level that you would see, again, kind of depending on the, on the price as well. We're disciplined buyers. We're not buyers at any price.
kind of the rationale you see, uh, for continuing to, uh, repurchase shares
Sure. So, you know, we we think of our our shares as trading, well, below their intrinsic value and it's, uh, you know, recognized by the, by the board as well. Uh, we have kind of an open market share repurchase plan that we that we execute on, you know, kind of given the, the trading volumes that we have. You don't see, you know, uh, hugely significant amounts that are being repurchased in this last quarter, it was 275,000 shares and in the absence of any large blocks or significant changes in the trading volume that's probably about the level that you would that you would see again kind of depending upon the on the pro.
W. Bruce Swain Jr.: To the extent there are blocks that come up, we would certainly be interested in looking at those to the extent that they're that our stock's trading, you know, significantly below what our assessment of intrinsic value is. You know, I think it's, it's something that you'll continue to see us active in through the end of 2027 based on the current authorization.
As well. We're we're disciplined buyers. We're not buyers at at at any price, uh, to the extent. There are blocks that that come up. Uh, we would certainly be interested in, uh, in looking at those to the extent that they're, uh, that our stocks trading. Uh, you know, significantly below what our assessment of intrinsic value is so, uh, you know, I think it it's, it's something that you'll continue to see us active in through, uh, the end of, uh, 27 based on the current authorization,
Kevin Steinke: Okay, good. That's helpful. I appreciate you taking the questions. I will turn it back over. Thanks.
W. Bruce Swain Jr.: Okay.
Okay good. Uh, that's helpful. I appreciate you uh, taking the questions. I I will turn it back over. Thanks.
Rohit Verma: Thank you, Kevin.
Okay.
Thank you. Kevin.
Tami Stevenson: Carly, if you check to see if there's any other questions.
Operator: Again, if you would like to ask a question, press star one on your telephone keypad. There are no further questions at this time. I will now turn the call back over to Mr. Verma for any closing remarks.
Carly. If you check to see if there's any other questions.
again, if you would like to ask a question press star 1 on your telephone keypad,
There are no further questions at this time. I will now turn the call back over to Mr. Verma, for any closing remarks
Rohit Verma: Thank you, Carly. A big thank you to all our employees, clients, and shareholders for your continued commitment to Crawford & Company. We look forward to seeing you next quarter. Thank you, and God bless.
Thank you, Carly.
And a big thank you to all our employees clients and shareholders for your continued commitment to Crawford & Company. We look forward to seeing you next quarter. Thank you. And God bless.
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