Crawford Q3 2026 Earnings Call Transcript

Crawford (NYSE:CRD) reported third-quarter financial results on Tuesday. The transcript from the company’s third-quarter earnings call has been provided below.

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Summary

Crawford and Company reported third-quarter revenues of $321.6 million, in line with the previous year, and a non-GAAP EPS increase to $0.37 from $0.32.

The company’s operating cash flow was $29 million year-to-date, with a leverage ratio of 1.52 times EBITDA, indicating financial strength and flexibility.

Strategic initiatives include integration of U.S. operations for improved efficiency, investment in technology and personnel, and a focus on alternative market segments like MGAs and MGUs.

International operations showed strong performance, with revenues increasing by 1% and operating earnings up by 39.4%, driven by weather-related claims in Australia and Canada.

Management highlighted the strong business pipeline, ongoing U.S. realignment, and a commitment to both reinvesting in the business and returning capital to shareholders through dividends and share repurchases.

Full Transcript

OPERATOR

At this time, I would like to welcome everyone to the Crawford third quarter 2026 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 speakers’ 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.

As a reminder, ladies and gentlemen, this conference is being recorded today, Tuesday, November 3, 2026. Now I would like to introduce Tammy Stevenson, Crawford and Company’s General Counsel.

Tammy Stevenson (General Counsel)

Thank you, Erica. 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 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 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 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. 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 any anticipated events. In addition, you are 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 which could affect the Company’s financial performance, please refer to the Company’s Form 10-Q for the quarter ended September 30, 2026, filed with the Securities and Exchange Commission, particularly 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. As required, a reconciliation is provided for those measures to the most directly comparable GAAP measures. I’d like to now introduce Mr. Bruce Swain, Chief Executive Officer of Crawford and Company. Bruce?

Bruce Swain (President & CEO)

Thank you, Tammy. Good morning and welcome to our third quarter 2026 earnings call. Joining me today are Holly Boudreau, our Chief Financial Officer, and Tammy Stevenson, our General Counsel. After our prepared remarks, we will open the call for your questions. As most of you know, Crawford is a global provider of claims management and outsourcing solutions serving insurance carriers and self-insured organizations with expertise and experience that spans the entire claims lifecycle. Our purpose is to restore lives, businesses and communities by delivering dependable and comprehensive claim solutions for our clients. With operations in more than 70 countries, a team of 10,000 professionals and over $20 billion in claims managed each year, we have unique scale and the resources to support the world’s leading insurers and corporations on programs of any size or complexity.

Our global reach is strengthened by more than eight decades of technical expertise and service excellence that provide Crawford and Company with a clear competitive advantage for clients looking for a trusted partner in an increasingly complex risk environment. Our capabilities are well matched to several ongoing market dynamics related to the property and casualty insurance claims industry. First, the major and complex loss market is expanding. Large, high severity losses demand deep technical knowledge, global coordination and efficient execution. Our team brings the comprehensive skill set and proven track record to meet the needs of our extensive customer base and also compete for and win new business.

Second, the integration of our streamlined U.S. operating structure is progressing well. Bringing our U.S. business together under a single client-centric model is improving collaboration and efficiency, providing opportunities to accelerate execution and creating a scalable platform for growth. Third, our industry-leading expertise and technology capabilities continue to help us win market share. Our ongoing investments in our people and technology enable us to deliver faster and more accurate outcomes for our clients.

Fourth, natural disasters and severe weather events remain a long-term source of demand for our services. While the timing of weather events is inherently unpredictable from quarter to quarter, over time, the trend toward a more frequent and complex loss environment creates demand for the scale and rapid response capabilities that Crawford provides around the world. Finally, global growth in alternative markets continues to outpace the legacy P&C market.

This includes single-parent and group captives as well as Managing General Agents, or MGAs, and Managing General Underwriters, or MGUs. As these alternative market segments expand, we’re seeing increasing demand for both the technical claims expertise of our Global Technical Services team and the third-party administration capabilities of Broadspire. I’ll now take a moment to discuss our third quarter 2026 results. Our third quarter performance demonstrated Crawford’s ability to deliver improved operating results even in a mixed claims environment. Our operating earnings exceeded the prior year and were driven primarily by the substantial completion of weather-related claims activity in our international business and lower corporate cost. Third quarter revenues were 321.6 million, relatively level with the prior year.

Consolidated over the prior year quarter to 28 point. Our non-GAAP EPS was 37 cents for both CRDA and CRDB, up from 32 cents for both share classes in the prior year quarter, and operating cash flow was 29 million year to date. Our pipeline activity in the RFP environment remains healthy. We added approximately 29 million in new and enhanced business during the third quarter, and the team is focused on converting the additional opportunities we’re seeing into wins.

Our leverage ratio is 1.52 times EBITDA, at the low end of our targeted range, reflecting our financial strength and flexibility, and our liquidity remains very strong. As we look to the fourth quarter, benign weather in the U.S. and the near completion of the catastrophe claims in International during the current quarter will pressure our fourth quarter results. Despite this, we’re optimistic about our ability to continue driving profitable market share growth, accelerating our U.S. realignment and strengthening operating discipline, and building the capabilities for long-term success. We take a thoughtful, balanced approach to deploying capital.

Our first priority is reinvesting in the business to drive long-term growth, both through capital expenditures and technology and through targeted M&A and acqui-hires that expand our capabilities, scale and reach. With a leverage ratio well below the industry average, we have the financial flexibility to act on opportunities as they arise. Alongside these investments, we remain committed to returning capital to shareholders, and in the third quarter we paid a quarterly dividend of $0.08 per share and opportunistically repurchased shares.

I’ll now hand the call over to Holly to walk through our segment results and financial performance in more detail.

Holly Boudreau (Executive Vice President – Chief Financial Officer)

Thank you, Bruce. In the third quarter of 2026, U.S. property and casualty, which consists of our U.S. loss adjusting and networks business, contributed 24% of revenues. Broadspire, our U.S. third-party administration business, represented 34% of revenues, and international operations accounted for 42% of revenues. Starting with U.S. property and casualty, revenues of $76 million were essentially flat year over year. The segment’s operating earnings were $9.7 million, down slightly from the prior-year period, but operating margins held steady. Improved results in our networks business, which includes Contractor Connection and catastrophe services, were offset by softer performance in U.S. loss adjusting. Lower U.S. property claims frequency has continued throughout the course of 2026.

Even so, our ability to attract and retain top-tier adjusting talent remains a key competitive advantage, and our team stands ready to handle major and complex claims at scale when activity returns. Turning to Broadspire, third-quarter revenues were $109 million, down 1.5% from the prior-year period due to lower casualty claims volumes and medical management revenues. Client retention improved sequentially to 88.5% from the second quarter, underscoring the durability of our client relationships. Operating earnings were $13 million, a decrease of $2.3 million, or 15.1% year over year, with operating margin down 191 basis points driven by lower revenue.

Looking forward, growth in outsourced captives in the MGA and MGU market continues to create opportunities in the alternative market space as claims grow more complex. Broadspire’s scale, expertise, and technology position it well to capture that demand. International operations delivered revenues of $136.5 million in the third quarter, an increase of 1% over the prior year. Excluding our exit from Crawford Legal Services and the effects of foreign exchange rates, revenues decreased 1.2%. Operating earnings grew $3 million, or 39.4%, and operating margin expanded 215 basis points. Australia led the segment’s performance as we benefited from the near completion of weather-related activity in the market.

In Canada, results were driven by severe flooding activity, increased utilization of GTS services, and continued cost-control initiatives. Additionally, we saw improved performance in Latin America. To give some context to the weather-related impact on our business, preliminary data shows that U.S. severe storm reports rose approximately 46% in the third quarter compared to the prior year. In comparison, our weather-related revenues in the quarter increased approximately 5% over the prior-year period, offset by a decline in CAT activity. Despite the increase in severe storms during the quarter, claims activity did not align. As we’ve discussed in the past, the relationship between storm counts and weather-related revenue isn’t always directly correlated.

Severity, geographic location, and carrier capacity can all influence our revenue. Non-weather-related revenues were down slightly. As we previously mentioned, the diversity and relative consistency of our non-weather business can moderate volatility from quarter to quarter. Now for a look at our consolidated results. In the 2026 third quarter, revenues before reimbursements were $321.6 million, essentially flat compared to the prior-year period. Foreign exchange rates increased revenues before reimbursements by $7.9 million, or 2.5%. GAAP net income attributable to shareholders totaled $15 million compared to net income of $12.4 million in the same period of 2025. GAAP diluted EPS in the 2026 third quarter was $0.31 for CRDA and CRDB, an increase from earnings of $0.25 for both share classes in the prior-year period.

On a non-GAAP basis, diluted EPS was $0.37 for both CRDA and CRDB, increasing from $0.32 for both share classes in the 2025 quarter. The company’s non-GAAP operating earnings totaled $28.8 million in the 2026 third quarter, or 9% of revenues, compared to $26.6 million, or 8.3% of revenues in the prior-year period. Consolidated Adjusted EBITDA was $37.1 million in the 2026 third quarter, or 11.5% of revenues, increasing from $36.3 million, or 11.3% of revenues, in the 2025 quarter.

The company’s cash and cash equivalents as of September 30, 2026 totaled $79 million, compared to $64.1 million at December 31, 2025. Total receivables were $259.9 million as of September 30, 2026, up $17.3 million from 2025 year-end. The company’s total debt outstanding as of September 30, 2026 totaled $225.1 million, up $36 million from December 31, 2025. Net debt was approximately $146 million as of September 30, 2026, while our U.S. pension liability was $12.8 million, reflecting a funded ratio of 95.4% after consideration of our $3 million cash contribution during the quarter.

Cash flows provided by operating activities for the first nine months of 2026 were $29 million, decreasing from $51.7 million in the prior-year period due to growth in billed and unbilled receivables. Free cash flows were $7.4 million in the 2026 period, declining from $24.1 million in the first nine months of 2025. Unallocated corporate costs were $4.5 million in the third quarter, down from $6.1 million in the 2025 period. The decrease was primarily due to $2.5 million in lower medical self-insurance expense compared to the prior-year period.

Non-service pension costs were $1.7 million in the quarter compared to $2.4 million in the prior-year period. In the third quarter of 2026, we paid a quarterly dividend of $0.08 a share. During the quarter, we repurchased 1.1 million shares of CRDA and 11,000 shares of CRDB, which included the privately negotiated repurchase of a million shares as disclosed in August. As of September 30, 2026, approximately 1.2 million shares remain eligible for repurchase under our existing program. With that, I’ll turn the call back over to Bruce for closing remarks.

Bruce Swain (President & CEO)

Thanks, Holly. The third quarter was a solid one for Crawford. We reported improved operating earnings over the prior year. International delivered strong results, and our diversified model provided stability through an uneven claims environment. We are encouraged by the strength of our client relationships, the growth in our new business pipeline, and the progress we’re making to improve execution across the organization. Moving forward, while we expect headwinds in the fourth quarter, we remain focused on driving profitable market share growth, accelerating our U.S. realignment, strengthening operating discipline, and building the capabilities for long-term success. Over the course of 2026, we’ve strengthened our leadership team, further defined our strategic priorities, and built greater accountability across the organization. There’s more work ahead, but I’m confident that the actions we’re taking are positioning Crawford for stronger, more consistent performance and sustainable long-term growth that will create lasting value for our clients and employees.

Thank you for your time today and for your continued interest in Crawford. We look forward to sharing our progress with you as we close out 2026 and move into the new year. Erica, please open the call for questions.

OPERATOR

At this time, if you would like to ask a question, please press star, then the number one on your telephone keypad. To withdraw your question, press star one again. If you are using a speakerphone, please pick up your handset before asking your question to allow for optimum sound quality. If you’re muted locally, please remember to unmute your device. We’ll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Mark Hughes with Truist Securities. Your line is open. Please go ahead.

Mark Hughes (Analyst at Truist Securities)

Yeah. Thank you. Good morning.

Bruce Swain (President & CEO)

Good morning, Mark.

Mark Hughes (Analyst at Truist Securities)

Hey, Bruce. Hey, Holly and Tammy. The casualty claims in the quarter I think you described were a little softer than expected. Is that kind of broad-based on some underlying change, or is that tied to a customer or two that might have influenced the quarter?

Holly Boudreau (Executive Vice President – Chief Financial Officer)

Are you talking about Broadspire in particular?

Mark Hughes (Analyst at Truist Securities)

Yes. Yeah. I’m sorry. Yep. In Broadspire. Yeah. And I guess I’d also ask, is the casualty, does that include the workers’ comp when you say casualty?

Holly Boudreau (Executive Vice President – Chief Financial Officer)

Yeah, yeah, it would include the workers’ comp. And, you know, we’re still seeing some of the impact from that client that we lost at the very beginning of the year. But more so, it was just kind of a general softness in claims during the quarter.

Mark Hughes (Analyst at Truist Securities)

Okay. You’ve talked about kind of the opportunity with captives or MGAs, alternative markets. How are you seeing that develop? When might we see that impact the P&L?

Bruce Swain (President & CEO)

Well, we’re certainly seeing it impact the P&L today, and a lot of the new wins that we have have been with new programs that we brought in and then also expansion of existing relationships that we have. We have invested in and created a business development team that’s specific to addressing the alternative market space and attracting especially insurers and brokers, MGAs, MGUs, et cetera. So we see that as a very compelling future opportunity for us and one that we’re quite excited about.

We think that what Crawford can bring is, you know, a customized, white-glove claims experience to these organizations who want to offer a specialized experience for the risks that they’re underwriting.

Mark Hughes (Analyst at Truist Securities)

On the weather claims, I think you described in the third quarter you substantially completed some of the international projects you’d been working on. I assume those are weather-related. If I look at last year’s fourth quarter, I think you had $77 million weather-related claims. How should I think about the number this year? Was that $77 million last year, is that kind of normal run rate, or is that still kind of a tough comp under the circumstances?

And maybe, as it looks today, the weather claims should be down from that.

Bruce Swain (President & CEO)

I think that I think about it a couple of ways. One, kind of split international from the U.S. From an international perspective, last year’s fourth quarter had a pickup in weather-related losses largely driven by events in Australia. And as we went through 2026, we saw those benefits in our international results, and we also saw benefits from the completion of losses that we had in Taiwan and Thailand that carried over into ’26. You know, as we look at our fourth quarter, we think the international comparison will be down because we’ve completed or substantially completed those international claims.

When I look at the U.S., last year, 2025, we had a weak weather-related claims environment. There was no tropical activity in the fourth quarter, and that really repeated through this year. So from a U.S. perspective, I think the comparison is probably going to be pretty flat because you’ve got the same sort of dynamic for weather-related claims both in the fourth quarter last year and the fourth quarter of this year.

Mark Hughes (Analyst at Truist Securities)

Yeah. How about the, in the cash flow, the billed and unbilled. Is this just a timing issue, or is there something around mix of business that is influencing those cash flow numbers and the balance sheet numbers?

Holly Boudreau (Executive Vice President – Chief Financial Officer)

It’s mainly a timing difference. As we see these international CAT activities starting to wind down, we believe those numbers will come back to more of a normal runway.

Mark Hughes (Analyst at Truist Securities)

Okay. And then I think, Holly, you might have described a little bit better performance in the networks business. Did I hear that properly? Maybe the Contractor Connection was better in Q3, if I heard that properly. Could you talk a little bit more about that?

Holly Boudreau (Executive Vice President – Chief Financial Officer)

Yeah, we saw some improved performance in networks. Remember we exited our Turvey business last year. That helped their performance. Operating earnings were up $1.5 million versus the prior-year quarter, and $1.2 million of that was Turvey-related.

Mark Hughes (Analyst at Truist Securities)

Okay. Any change in top-line trends? Anything there in terms of networks?

Bruce Swain (President & CEO)

Yeah, no, I think, you know, it’s obviously a business that’s impacted by weather, and so, like our property and casualty business or U.S. loss adjusting business, they’re going to be impacted by weather trends. We don’t see any significant movement there on the Contractors Connection side. And of course our catastrophe response business is down pretty significantly over year as it has been all year, and that’s largely reflecting the weather trends that we’re seeing.

But again, as we look at the fourth quarter this year versus last year, we think that our weather-related businesses are going to be pretty flat.

Mark Hughes (Analyst at Truist Securities)

Okay, thank you very much.

Bruce Swain (President & CEO)

Thank you.

OPERATOR

Your next question comes from the line of Kevin Stanke with Barrington Research. Your line is open. Please go ahead.

Kevin Stanke (Analyst at Barrington Research)

Great, thank you. Wanted to just follow up on the weather-related business. And as you noted, the U.S. severe storm activity was up about 46% and you noted that your revenue performance didn’t follow that, which I guess is not surprising given the factors you’ve talked about. I mean, would you primarily attribute that to just the excess carrier capacity, or are there still, do you feel like, affordability issues in the property insurance market for homeowners, or just kind of what you’re seeing in relation to the various factors there?

Bruce Swain (President & CEO)

Yeah, obviously there’s capacity in the carriers, and you only have to look at the P&C carrier results to see it. They’re enjoying another great year, and that obviously gives them a lot of internal capacity to handle claims. In terms of property affordability, I mean, we’re certainly seeing rates go down. I mean, it’s a soft market. There could be some scars from prior years where people are maybe hesitant to still make claims. But pricing at the top-line level is certainly not something that we would see as holding claims back.

I do think, as you look at the softening market, if we have an event, it creates a high demand for our services. But the property claims market, from an adjuster’s perspective, has been pretty tough the past couple of years.

Kevin Stanke (Analyst at Barrington Research)

Okay. Yeah. Okay, that’s helpful. And you talked about the integration of your U.S. operations progressing well. Are you pretty much done with the process, and where do you stand in that process? And have you started to see any benefits flowing out of that in terms of just the sales engine, I guess, as you go to market in a more integrated fashion?

Bruce Swain (President & CEO)

Made a lot of progress. There’s fine-tuning to do as we go. For our sales and marketing group, we’re approaching the market in an integrated fashion. Our account management team in the U.S. is all aligned. We’ve got technology in the U.S. all aligned. We’re a lot more coordinated in our approach and we’re operating as one organization rather than a collection of individual organisms. So I’m certainly seeing the benefits, the collaboration and efficiency and the teamwork, and I think we’ll see that show through in our results as we go forward.

Kevin Stanke (Analyst at Barrington Research)

Okay, yeah, that’s good to hear. And you also mentioned that the pipeline looks good, RFP opportunities look good. Any particular businesses where you’re seeing the pipelines build, or is it kind of generally across the board?

Bruce Swain (President & CEO)

It’s across the board. But maybe getting back to the question that Mark asked about the alternative market space, we are seeing a lot of opportunities in the pipeline from the alternative market space. So whether that’s captives, MGAs, MGUs, that is becoming an increasing amount of the pipeline that we have. But overall our pipeline is strong and it’s global across all of our businesses.

Kevin Stanke (Analyst at Barrington Research)

Okay, great. So you talked about your leverage ratio being quite low right now, and I assume that would give you the necessary capacity to continue looking at acquisition opportunities. Any thoughts on acquisition opportunities, what kind of things you’re seeing in the pipeline, and your appetite for continuing to pursue acquisitions currently?

Holly Boudreau (Executive Vice President – Chief Financial Officer)

Ratio is at 1.52, which is on the lower end, and we do have capacity to make strategic acquisitions as we see fit. We’ve primarily been focused over the recent past couple of years, but we always have an active pipeline for opportunities, and we’ve seen a lot of success as we’ve done these tuck-ins and acqui-hires, where we go out and acquire certain teams. But our pipeline is active, and we have low enough leverage to do a good deal when we see one.

Kevin Stanke (Analyst at Barrington Research)

Okay, that sounds good. I appreciate the update. I will turn it back over.

OPERATOR

As a reminder, if you would like to ask a question, please press star one on your telephone keypad. We have reached the end of the Q&A session. I will now turn the call back to Mr. Swain for closing remarks.

Bruce Swain (President & CEO)

Thank you, Erica, and thank you to all of our employees, clients, and shareholders for your continued commitment to Crawford and Company. We hope you have a great rest of the week and look forward to speaking to you on our fourth quarter earnings call. Thank you very much.

OPERATOR

Thank you for participating in today’s Crawford and Company conference call. This will be available for replay at 11:30 a.m. EST today through 11:59 p.m. EST on November 10, 2026. The meeting ID for the replay is 623-27-5442. The number to dial for the replay is 1833309. Thank you. You may now disconnect.

Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company’s SEC filings and official press releases. Corporate participants’ and analysts’ statements reflect their views as of the date of this call and are subject to change without notice.