Crawford & Company NYSE: CRD.A reported second-quarter results marked by stronger operating earnings, improved margins and growth in its Broadspire and International Operations businesses, while consolidated revenue declined slightly from a year earlier.
Chief Executive Officer Bruce Swain said the company generated its best overall operating earnings since the third quarter of 2023, citing operational execution and weather-related claims activity in Australia and Asia. He characterized the international weather benefit as episodic and said the related projects are expected to wind down through the second half of the year.
Second-quarter revenue before reimbursements totaled $321.4 million, down slightly year over year. Foreign exchange movements added $7.7 million, or 2.5%, to revenue. Consolidated non-GAAP operating earnings rose to $29.4 million, or 9.2% of revenue, from $22 million, or 6.8% of revenue, in the prior-year quarter.
GAAP net income attributable to shareholders was $13.4 million, compared with $7.8 million a year earlier. Diluted GAAP earnings per share were $0.27 for CRD.A shares and $0.28 for CRD.B shares, versus $0.16 for both share classes in the year-earlier period. Non-GAAP diluted earnings per share increased to $0.38 for both share classes from $0.22.
Broadspire and International Drive Earnings Improvement
Broadspire, the company’s U.S.-based third-party administration business, reported quarterly revenue of $109.4 million, up 1.2% from the prior-year period. The increase reflected new disability clients and improved medical-management revenue, according to Chief Financial Officer Holly Boudreau.
Broadspire’s operating earnings increased 10.8% to $15.7 million, while operating margin expanded 130 basis points. Its quarterly retention rate was 87.5%, improving sequentially from the first quarter.
Swain said Broadspire’s pipeline is weighted toward third-party administration opportunities, including business from alternative-market participants such as managing general agents, managing general underwriters and captives. He said these organizations often seek turnkey claims solutions rather than building their own internal claims operations.
The company said Broadspire had made advance hires earlier in the year to prepare for incoming business, and those investments supported revenue growth during the quarter. Swain said Crawford remains bullish on the business over the longer term, though hiring ahead of new client launches could affect quarterly margins.
International Operations revenue rose 4.2% to $138 million. Excluding the exit of Crawford Legal Services and foreign currency movements, revenue increased 1.6%. Operating earnings in the segment rose 48.2%, or $3.5 million, and operating margin expanded 240 basis points.
The International segment benefited from heightened weather-related claims activity in Australia and Asia, as well as improved performance in Canada following cost-control initiatives. Swain said the nearly 8% International operating margin achieved in the quarter was materially above recent levels and is expected to decline as weather-related work moderates.
Over time, the company aims to improve International margins toward the 10% range, Swain said, through further cost efficiencies, technology investment, pricing discipline and profitable revenue growth. He noted that managing operations across 28 countries limits some of the scale benefits available in the U.S.
U.S. Property & Casualty Revenue Declines
U.S. Property & Casualty revenue declined 10.2% year over year, primarily due to softer performance in the company’s networks business. Segment operating earnings fell $300,000, or 4%, though operating margin increased 70 basis points as the company managed expenses and saw a more favorable business mix.
Swain said lower-margin staff-augmentation work in catastrophe services has declined after carriers internalized some of that volume. The broader absence of major U.S. weather events has also reduced property losses and network revenue, he said.
U.S. severe storm activity declined 6.8% in the second quarter from a year earlier, while Crawford’s weather-related revenue decreased 1.4%. Non-weather business was consistent year over year, Boudreau said.
Swain said a higher level of future weather activity could improve the outlook for the networks business, which is heavily tied to property losses.
Cash Flow, Capital Allocation and Legal Services Exit
Cash flow from operating activities for the first six months of 2026 totaled $23.1 million, up from $21.1 million in the comparable 2025 period. Free cash flow increased to $7.9 million from $2.6 million.
As of June 30, cash and cash equivalents totaled $69.4 million, while total debt was $198.1 million. Net debt was approximately $129 million, and Swain said the company’s leverage ratio was 1.45 times EBITDA, at the low end of its target range.
The company added nearly $22 million in new and enhanced business during the quarter across its segments. It also repurchased approximately 295,000 CRD.A shares and 38,000 CRD.B shares, with about 1.3 million shares remaining under its repurchase authorization as of June 30.
Crawford increased its quarterly dividend to $0.08 per share from $0.075 per share, payable in August.
During the quarter, the company recognized a $2.3 million impairment charge related to two software assets. It also recorded a $1.3 million net loss related to the sale of Crawford Legal Services operations in the United Kingdom and Chile. Boudreau said the exited Legal Services operations generated approximately $18.8 million in revenue in the prior year and that the company expects an additional $1.3 million expense when the U.K. entity is fully closed.
Looking ahead, Swain said Crawford’s priorities are organic revenue growth, profitable market-share gains, stronger sales effectiveness, U.S. integration and operating discipline. He also said the company continues to evaluate selective acquisitions and “acqui-hire” opportunities, particularly to expand its Global Technical Services capabilities.
About Crawford & Company (NYSE:CRD.A)
Crawford & Company provides claims management and outsourcing solutions to the risk management and insurance industry, and self-insured entities. The company's Crawford Claims Solutions segment offers claims management services related to property, casualty, and catastrophe losses caused by physical damage to commercial and residential real properties, and personal properties, as well as marine losses. It also offers services in the areas of field investigation, catastrophe, evaluation, and resolution of property and casualty insurance claims; and various on-demand inspection, verification, and other task specific field services for businesses and consumers through a mobile platform.
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