| Segment Information |
11. Segment Information In connection with the realignment of management responsibilities, the Company updated its reportable segments effective January 1, 2026. The Company's reportable segments are comprised of the following: •U.S. Property & Casualty, which provides claims management services to insurance carriers and self-insured entities related to property and casualty losses. This is comprised of U.S. Loss Adjusting which includes Global Technical Services and Claims Solutions. This reportable segment also includes Networks which consists of the Contractor Connection and Catastrophe Services operations previously reported within the Platform Solutions Segment. The U.S. Property & Casualty reportable segment represents the aggregation of certain service line operating segments. •Broadspire, which provides third party administration for workers' compensation, auto and liability, disability management, medical management, and accident and health to corporations, brokers and insurers as well as subrogation services in the U.S. Broadspire includes the subrogation operations that were previously reported within the Platform Solutions Segment. •International Operations, which services the global property and casualty market outside the U.S., includes all operations within the U.K., Europe, Australia, Asia, and Latin America as well as the Canadian operations that were previously reported within the North America Loss Adjusting segment. The Company's three reportable segments represent components of the business for which separate financial information is available, and which is evaluated regularly by the chief operating decision maker ("CODM"). The Company’s President and Chief Executive Officer, Mr. W. Bruce Swain Jr., is considered the CODM as he is responsible for strategic decisions including the allocation of resources to each reporting segment and the assessment of their performance. Specifically, he assesses the financial health of each segment, reviews budgeting and resource allocation, directs all strategic planning, reviews investments for new products and technology allocations, evaluates pricing strategies and cash flow management, and oversees risk management for each segment. Mr. Swain regularly meets with the segment managers to discuss financial performance, operational issues and revenue forecasts. Additionally, the segment managers create segment-level budgets and forecasts and receive incentive compensation derived from the operating results of the segments. These financial packages are discussed in the meetings with Mr. Swain. Operating earnings is the primary financial performance measure used by the Company's senior management and the CODM to evaluate the financial performance of the Company's operating segments and make resource allocation decisions. The Company believes this measure is useful to investors in that it allows them to evaluate segment operating performance using the same criteria used by the Company's senior management and CODM. The CODM considers revenues before reimbursements and operating earnings when making decisions about the allocation of operating and capital resources. Operating earnings will differ from net income computed in accordance with GAAP since operating earnings represent segment earnings before certain unallocated corporate and shared costs and credits, net corporate interest expense, stock option expense, amortization of acquisition-related intangible assets, contingent earnout adjustments, non-service pension costs, income taxes, loss on disposition of businesses, net, software impairment, and net income or loss attributable to noncontrolling interests. Segment operating earnings includes allocations of certain corporate and shared costs. If the Company changes its allocation methods or changes the types of costs that are allocated to its three reportable segments, prior period amounts presented in the current period financial statements are adjusted to conform to the current allocation process. In the normal course of its business, the Company sometimes pays for certain out-of-pocket expenses that are thereafter reimbursed by its clients. Under GAAP, these out-of-pocket expenses and associated reimbursements are required to be included when reporting expenses and revenues, respectively, in the Company's consolidated results of operations. However, in evaluating segment results, Company management excludes these reimbursements and related expenses from segment results, as they offset each other. Financial information as of and for the three and six months ended June 30, 2026 and 2025 related to the Company's reportable segments is presented below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2026 |
|
|
|
U.S. Property & Casualty |
|
Broadspire |
|
International
Operations |
|
Total |
|
|
|
(In thousands) |
|
Revenues before reimbursements |
|
$ |
74,065 |
|
$ |
109,423 |
|
$ |
137,951 |
|
$ |
321,439 |
|
Less: |
|
|
|
|
|
|
|
|
|
Segment Expenses: |
|
|
|
|
|
|
|
|
|
Compensation |
|
|
37,034 |
|
|
46,957 |
|
|
69,513 |
|
|
153,504 |
|
Benefits and payroll taxes |
|
|
7,104 |
|
|
10,720 |
|
|
13,182 |
|
|
31,006 |
|
Non-employee labor |
|
|
1,211 |
|
|
2,890 |
|
|
6,276 |
|
|
10,377 |
|
Total Compensation |
|
|
45,349 |
|
|
60,567 |
|
|
88,971 |
|
|
194,887 |
|
Office rent and occupancy |
|
|
692 |
|
|
2,031 |
|
|
4,008 |
|
|
6,731 |
|
Other office operating expense(1) |
|
|
3,573 |
|
|
3,533 |
|
|
8,684 |
|
|
15,790 |
|
Depreciation |
|
|
883 |
|
|
2,060 |
|
|
1,107 |
|
|
4,050 |
|
Professional fees |
|
|
561 |
|
|
5,235 |
|
|
1,872 |
|
|
7,668 |
|
Cost of risk |
|
|
824 |
|
|
405 |
|
|
882 |
|
|
2,111 |
|
Other, net(2) |
|
|
2,990 |
|
|
464 |
|
|
1,516 |
|
|
4,970 |
|
Total Other Operating Expense |
|
|
9,523 |
|
|
13,728 |
|
|
18,069 |
|
|
41,320 |
|
Allocated corporate, shared services, and administrative costs(3) |
|
|
12,038 |
|
|
19,398 |
|
|
20,049 |
|
|
51,485 |
|
Total Segment Expenses |
|
|
66,910 |
|
|
93,693 |
|
|
127,089 |
|
|
287,692 |
|
Segment Operating Earnings |
|
$ |
7,155 |
|
$ |
15,730 |
|
$ |
10,862 |
|
$ |
33,747 |
|
Reconciliation of segment operating earnings: |
|
|
|
|
|
|
|
|
|
Unallocated corporate administrative costs(4) |
|
|
|
|
|
|
|
|
(4,302 |
) |
Net corporate interest expense |
|
|
|
|
|
|
|
|
(2,852 |
) |
Stock option expense |
|
|
|
|
|
|
|
|
(114 |
) |
Amortization of acquisition-related intangible assets |
|
|
|
|
|
|
|
|
(1,782 |
) |
Non-service pension costs |
|
|
|
|
|
|
|
|
(1,462 |
) |
Loss on disposition of businesses, net(5) |
|
|
|
|
|
|
|
|
(1,285 |
) |
Software impairment |
|
|
|
|
|
|
|
|
(2,294 |
) |
Income before income taxes |
|
|
|
|
|
|
|
|
19,656 |
|
Income taxes |
|
|
|
|
|
|
|
|
(6,235 |
) |
Net Income |
|
|
|
|
|
|
|
|
13,421 |
|
Net Loss Attributable to Noncontrolling Interests |
|
|
|
|
|
|
|
|
27 |
|
Net Income Attributable to Shareholders of Crawford & Company |
|
|
|
|
|
|
|
$ |
13,448 |
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2026 |
|
|
U.S. Property & Casualty |
Broadspire |
International
Operations |
Total |
|
|
(In thousands) |
Revenues before reimbursements |
|
$146,950 |
$214,181 |
$269,833 |
$630,964 |
Less: |
|
|
|
|
|
Segment Expenses: |
|
|
|
|
|
Compensation |
|
74,222 |
93,794 |
139,298 |
307,314 |
Benefits and payroll taxes |
|
14,305 |
21,400 |
26,798 |
62,503 |
Non-employee labor |
|
2,455 |
5,754 |
13,232 |
21,441 |
Total Compensation |
|
90,982 |
120,948 |
179,328 |
391,258 |
Office rent and occupancy |
|
1,469 |
4,057 |
8,019 |
13,545 |
Other office operating expense(1) |
|
6,959 |
6,875 |
17,355 |
31,189 |
Depreciation |
|
1,798 |
4,105 |
2,222 |
8,125 |
Professional fees |
|
1,067 |
9,970 |
3,905 |
14,942 |
Cost of risk |
|
1,342 |
1,171 |
2,037 |
4,550 |
Other, net(2) |
|
3,533 |
575 |
3,546 |
7,654 |
Total Other Operating Expense |
|
16,168 |
26,753 |
37,084 |
80,005 |
Allocated corporate, shared services, and administrative costs(3) |
|
25,029 |
39,894 |
38,562 |
103,485 |
Total Segment Expenses |
|
132,179 |
187,595 |
254,974 |
574,748 |
Segment Operating Earnings |
|
$14,771 |
$26,586 |
$14,859 |
$56,216 |
Reconciliation of segment operating earnings: |
|
|
|
|
|
Unallocated corporate administrative costs(4) |
|
|
|
|
(13,073) |
Net corporate interest expense |
|
|
|
|
(5,497) |
Stock option expense |
|
|
|
|
(300) |
Amortization of acquisition-related intangible assets |
|
|
|
|
(3,566) |
Non-service pension costs |
|
|
|
|
(3,438) |
Contingent earnout adjustments |
|
|
|
|
180 |
Loss on disposition of businesses, net(5) |
|
|
|
|
(1,285) |
Software impairment |
|
|
|
|
(2,294) |
Income before income taxes |
|
|
|
|
26,943 |
Income taxes |
|
|
|
|
(8,610) |
Net Income |
|
|
|
|
18,333 |
Net Loss Attributable to Noncontrolling Interests |
|
|
|
|
20 |
Net Income Attributable to Shareholders of Crawford & Company |
|
|
|
|
$18,353 |
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2025 |
|
|
U.S. Property & Casualty |
Broadspire |
International
Operations |
Total |
|
|
(In thousands) |
Revenues before reimbursements |
|
$82,500 |
$108,158 |
$132,339 |
$322,997 |
Less: |
|
|
|
|
|
Segment Expenses: |
|
|
|
|
|
Compensation |
|
41,545 |
47,026 |
68,387 |
156,958 |
Benefits and payroll taxes |
|
7,601 |
10,622 |
12,471 |
30,694 |
Non-employee labor |
|
1,854 |
3,046 |
7,307 |
12,207 |
Total Compensation |
|
51,000 |
60,694 |
88,165 |
199,859 |
Office rent and occupancy |
|
1,145 |
2,163 |
4,140 |
7,448 |
Other office operating expense(1) |
|
3,787 |
3,317 |
8,574 |
15,678 |
Depreciation |
|
1,817 |
1,448 |
1,074 |
4,339 |
Professional fees |
|
533 |
4,995 |
821 |
6,349 |
Cost of risk |
|
787 |
1,039 |
730 |
2,556 |
Other, net(2) |
|
2,160 |
340 |
1,860 |
4,360 |
Total Other Operating Expense |
|
10,229 |
13,302 |
17,199 |
40,730 |
Allocated corporate, shared services, and administrative costs(3) |
|
13,820 |
19,960 |
19,644 |
53,424 |
Total Segment Expenses |
|
75,049 |
93,956 |
125,008 |
294,013 |
Segment Operating Earnings |
|
$7,451 |
$14,202 |
$7,331 |
$28,984 |
Reconciliation of segment operating earnings: |
|
|
|
|
|
Unallocated corporate administrative costs(4) |
|
|
|
|
(6,988) |
Net corporate interest expense |
|
|
|
|
(3,858) |
Non-service pension costs |
|
|
|
|
(2,354) |
Stock option expense |
|
|
|
|
(214) |
Amortization of acquisition-related intangible assets |
|
|
|
|
(1,825) |
Contingent earnout adjustments |
|
|
|
|
(80) |
Income before income taxes |
|
|
|
|
13,665 |
Income taxes |
|
|
|
|
(5,845) |
Net Income |
|
|
|
|
7,820 |
Net Income Attributable to Noncontrolling Interests |
|
|
|
|
(38) |
Net Income Attributable to Shareholders of Crawford & Company |
|
|
|
|
$7,782 |
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2025 |
|
|
U.S. Property & Casualty |
Broadspire |
International
Operations |
Total |
|
|
(In thousands) |
Revenues before reimbursements |
|
$164,690 |
$211,830 |
$258,509 |
$635,029 |
Less: |
|
|
|
|
|
Segment Expenses: |
|
|
|
|
|
Compensation |
|
83,108 |
92,077 |
134,006 |
309,191 |
Benefits and payroll taxes |
|
15,274 |
21,005 |
24,790 |
61,069 |
Non-employee labor |
|
3,406 |
5,955 |
15,836 |
25,197 |
Total Compensation |
|
101,788 |
119,037 |
174,632 |
395,457 |
Office rent and occupancy |
|
2,312 |
4,317 |
8,276 |
14,905 |
Other office operating expense(1) |
|
7,577 |
6,785 |
16,890 |
31,252 |
Depreciation |
|
3,620 |
2,895 |
2,082 |
8,597 |
Professional fees |
|
1,107 |
9,234 |
3,205 |
13,546 |
Cost of risk |
|
929 |
2,111 |
395 |
3,435 |
Other, net(2) |
|
2,991 |
644 |
3,736 |
7,371 |
Total Other Operating Expense |
|
18,536 |
25,986 |
34,584 |
79,106 |
Allocated corporate, shared services, and administrative costs(3) |
|
27,135 |
40,628 |
39,742 |
107,505 |
Total Segment Expenses |
|
147,459 |
185,651 |
248,958 |
582,068 |
Segment Operating Earnings |
|
$17,231 |
$26,179 |
$9,551 |
$52,961 |
Reconciliation of segment operating earnings: |
|
|
|
|
|
Unallocated corporate administrative costs(4) |
|
|
|
|
(13,121) |
Net corporate interest expense |
|
|
|
|
(7,802) |
Non-service pension costs |
|
|
|
|
(4,687) |
Stock option expense |
|
|
|
|
(398) |
Amortization of acquisition-related intangible assets |
|
|
|
|
(3,625) |
Contingent earnout adjustments |
|
|
|
|
(443) |
Income before income taxes |
|
|
|
|
22,885 |
Income taxes |
|
|
|
|
(8,325) |
Net Income |
|
|
|
|
14,560 |
Net Income Attributable to Noncontrolling Interests |
|
|
|
|
(94) |
Net Income Attributable to Shareholders of Crawford & Company |
|
|
|
|
$14,466 |
(1)Other office and operating expenses include travel and entertainment, automobile expenses, office operating expenses and data processing costs. (2)Other, net primarily includes advertising expenses, bank service charges, bad debt expense, and property and other taxes. (3)Allocated corporate, shared services, and administrative costs, comprise of expenses for administrative functions, including direct compensation, payroll taxes, and benefits which are allocated to each segment based on usage. (4)Unallocated corporate and shared costs and credits represent expenses for the Company's Chief Executive Officer and Board of Directors, certain adjustments to self-insured liabilities, certain unallocated legal and professional fees and other charges, and certain adjustments and recoveries to the Company's allowances for estimated credit losses. (5)Loss on disposition of businesses, net relates to the sales of the U.K. and Chile Crawford Legal Services businesses. Segment assets consist of accounts receivable, less allowance for expected credit losses, unbilled revenues at estimated billable amounts, goodwill and intangible assets arising from business acquisitions, net. Assets at June 30, 2026 and December 31, 2025 were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Property & Casualty |
|
|
Broadspire |
|
|
International Operations |
|
|
Total |
|
|
|
(In thousands) |
|
June 30, 2026 |
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
$ |
108,618 |
|
|
$ |
110,075 |
|
|
$ |
180,509 |
|
|
$ |
399,202 |
|
December 31, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
104,970 |
|
|
|
103,996 |
|
|
|
176,576 |
|
|
|
385,542 |
|
Revenues by geographic region and major service line for the U.S. Property & Casualty, Broadspire, and International Operations segments are shown in Note 3, "Revenue Recognition." Capital expenditures for the three and six months ended June 30, 2026 and 2025 are shown in the following table:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
(in thousands) |
|
June 30,
2026 |
|
|
June 30,
2025 |
|
|
June 30,
2026 |
|
|
June 30,
2025 |
|
U.S. Property & Casualty |
|
$ |
283 |
|
|
$ |
1,264 |
|
|
$ |
404 |
|
|
$ |
2,658 |
|
Broadspire |
|
|
3,027 |
|
|
|
3,928 |
|
|
|
6,775 |
|
|
|
7,380 |
|
International Operations |
|
|
626 |
|
|
|
212 |
|
|
|
1,629 |
|
|
|
515 |
|
Corporate |
|
|
3,447 |
|
|
|
3,761 |
|
|
|
6,434 |
|
|
|
7,935 |
|
Total capital expenditures |
|
$ |
7,383 |
|
|
$ |
9,165 |
|
|
$ |
15,242 |
|
|
$ |
18,488 |
|
The total of the Company's reportable segments' revenues before reimbursements reconciled to total consolidated revenues for the three and six months ended June 30, 2026 and 2025 was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
(in thousands) |
|
June 30,
2026 |
|
|
June 30,
2025 |
|
|
June 30,
2026 |
|
|
June 30,
2025 |
|
Segments' revenues before reimbursements |
|
$ |
321,439 |
|
|
$ |
322,997 |
|
|
$ |
630,964 |
|
|
$ |
635,029 |
|
Reimbursements |
|
|
8,585 |
|
|
|
11,598 |
|
|
|
19,186 |
|
|
|
22,905 |
|
Total consolidated revenues |
|
$ |
330,024 |
|
|
$ |
334,595 |
|
|
$ |
650,150 |
|
|
$ |
657,934 |
|
The Company's reportable segments' total operating earnings reconciled to consolidated income before income taxes for the three and six months ended June 30, 2026 and 2025 were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
(in thousands) |
|
June 30,
2026 |
|
|
June 30,
2025 |
|
|
June 30,
2026 |
|
|
June 30,
2025 |
|
Operating earnings of all reportable segments |
|
$ |
33,747 |
|
|
$ |
28,984 |
|
|
$ |
56,216 |
|
|
$ |
52,961 |
|
Unallocated corporate and shared costs and credits |
|
|
(4,302 |
) |
|
|
(6,988 |
) |
|
|
(13,073 |
) |
|
|
(13,121 |
) |
Net corporate interest expense |
|
|
(2,852 |
) |
|
|
(3,858 |
) |
|
|
(5,497 |
) |
|
|
(7,802 |
) |
Stock option expense |
|
|
(114 |
) |
|
|
(214 |
) |
|
|
(300 |
) |
|
|
(398 |
) |
Amortization of acquisition-related intangible assets |
|
|
(1,782 |
) |
|
|
(1,825 |
) |
|
|
(3,566 |
) |
|
|
(3,625 |
) |
Non-service pension costs |
|
|
(1,462 |
) |
|
|
(2,354 |
) |
|
|
(3,438 |
) |
|
|
(4,687 |
) |
Loss on disposition of businesses, net |
|
|
(1,285 |
) |
|
|
— |
|
|
|
(1,285 |
) |
|
|
— |
|
Software impairment |
|
|
(2,294 |
) |
|
|
— |
|
|
|
(2,294 |
) |
|
|
— |
|
Contingent earnout adjustments |
|
|
— |
|
|
|
(80 |
) |
|
|
180 |
|
|
|
(443 |
) |
Income before income taxes |
|
$ |
19,656 |
|
|
$ |
13,665 |
|
|
$ |
26,943 |
|
|
$ |
22,885 |
|
The Company's reportable segments' total assets reconciled to consolidated total assets of the Company at June 30, 2026 and December 31, 2025 are presented in the following table:
|
|
|
|
|
|
|
|
|
|
|
June 30,
2026 |
|
|
December 31,
2025 |
|
|
|
(In thousands) |
|
Assets of reportable segments |
|
$ |
399,202 |
|
|
$ |
385,542 |
|
Corporate assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
|
69,419 |
|
|
|
64,079 |
|
Income taxes receivable |
|
|
3,735 |
|
|
|
4,350 |
|
Prepaid expenses and other current assets |
|
|
29,839 |
|
|
|
41,362 |
|
Net property and equipment |
|
|
15,811 |
|
|
|
16,649 |
|
Operating lease right-of-use asset, net |
|
|
59,706 |
|
|
|
66,322 |
|
Capitalized software costs, net |
|
|
110,673 |
|
|
|
112,812 |
|
Deferred income tax assets |
|
|
23,549 |
|
|
|
24,684 |
|
Other noncurrent assets |
|
|
46,318 |
|
|
|
48,500 |
|
Total corporate assets |
|
|
359,050 |
|
|
|
378,758 |
|
Total assets |
|
$ |
758,252 |
|
|
$ |
764,300 |
|
|