Crawford & Company (NYSE:CRD.A) reported third-quarter results marked by higher operating earnings and stable revenue as stronger international performance and lower corporate costs helped offset a mixed claims environment in the United States.
Revenue before reimbursements was $321.6 million in the quarter, essentially unchanged from the prior-year period. Foreign exchange rates added $7.9 million, or 2.5%, to revenue. GAAP net income attributable to shareholders rose to $15 million from $12.4 million a year earlier, while diluted earnings per share increased to $0.31 from $0.25 for both share classes.
On a non-GAAP basis, diluted earnings per share were $0.37 for both CRD.A and CRD.B shares, compared with $0.32 in the prior-year quarter. Non-GAAP operating earnings increased to $28.8 million, or 9% of revenue, from $26.6 million, or 8.3% of revenue. Adjusted EBITDA rose to $37.1 million, representing 11.5% of revenue, from $36.3 million, or 11.3% of revenue.
International operations lead earnings improvement
Chief Executive Officer Bruce Swain said the company’s operating earnings improvement was driven primarily by the substantial completion of weather-related claims activity in its international business and lower corporate costs.
International operations generated third-quarter revenue of $136.7 million, up 1% from the prior-year period. Excluding the exit from Crawford Legal Services and foreign-exchange effects, revenue declined 1.2%. However, segment operating earnings increased $3 million, or 39.4%, and operating margin expanded 215 basis points.
Australia led international performance as the company benefited from the near completion of weather-related activity. In Canada, results reflected severe flooding activity, increased use of global technical services and cost-control initiatives. Crawford also cited improved performance in Latin America.
Swain said international comparisons will likely be lower in the fourth quarter because weather-related claims in Australia, Taiwan and Thailand have been completed or substantially completed.
U.S. claims trends weigh on property and Broadspire results
U.S. property and casualty revenue was $76 million, essentially flat year over year. Operating earnings totaled $9.7 million, slightly below the prior-year period, while margins remained steady.
Improved results in the company’s networks business, which includes Contractor Connection and catastrophe services, were offset by softer performance in U.S. loss adjusting. Chief Financial Officer Holly Boudreau said lower U.S. property claims frequency continued throughout 2026.
During the analyst question-and-answer session, Boudreau said operating earnings in networks increased $1.5 million from the prior-year quarter, with $1.2 million of that improvement related to the company’s exit from the Turvi business last year. Swain said catastrophe response activity remained significantly lower year over year, reflecting weather trends.
Broadspire, Crawford’s U.S. third-party administration business, recorded revenue of $109 million, down 1.5% from a year earlier due to lower casualty claims volumes and medical-management revenue. Operating earnings declined $2.3 million, or 15.1%, to $13 million, and operating margin fell 191 basis points.
Swain said the softer casualty activity included workers’ compensation claims. He attributed the decline partly to the impact of a client lost at the beginning of the year, as well as broader claims softness during the quarter. Broadspire’s client retention improved sequentially to 88.5% from the second quarter.
Weather activity did not translate directly into revenue
The company said preliminary data showed U.S. severe-storm reports increased approximately 46% in the third quarter from the prior-year period. Crawford’s weather-related revenue rose about 5%, however, while declining catastrophe activity offset some of the increase.
Management said storm counts do not always correlate directly with revenue because claim severity, geographic location and insurers’ internal claims-handling capacity can affect demand. Swain noted that insurance carriers have had strong results and therefore have capacity to handle more claims internally.
For the fourth quarter, Swain said the company expects U.S. weather-related results to be roughly flat compared with the prior-year period. He noted that there was no tropical activity in the fourth quarter of 2025, a dynamic that has largely continued this year.
Cash flow declines as receivables increase
Cash and cash equivalents totaled $79 million as of Sept. 30, up from $64.1 million at year-end 2025. Total debt was $225.1 million, up $36 million from year-end, while net debt was approximately $146 million. The company’s leverage ratio was 1.52 times EBITDA, at the low end of its targeted range, according to Swain.
Operating cash flow for the first nine months of 2026 was $29 million, down from $51.7 million in the comparable 2025 period. Free cash flow fell to $7.4 million from $24.1 million. Boudreau attributed the decline primarily to growth in billed and unbilled receivables and said the balance should return toward a more normal level as international catastrophe activity winds down.
Crawford paid a quarterly dividend of $0.08 per share and repurchased 1.1 million CRD.A shares and 11,000 CRD.B shares during the quarter, including a privately negotiated repurchase of 1 million shares disclosed in August. About 1.2 million shares remained available under the company’s repurchase authorization as of Sept. 30.
Management said its pipeline of requests for proposals remained healthy, with approximately $29 million in new and expanded business added during the quarter. Swain highlighted opportunities in captives, managing general agents and managing general underwriters, while Boudreau said the company retains capacity for strategic acquisitions and continues to evaluate tuck-in acquisitions and acqui-hires.
Looking ahead, Swain said benign U.S. weather and the completion of international catastrophe claims activity are expected to pressure fourth-quarter results. He said the company remains focused on profitable market-share growth, integration of its U.S. operations, operating discipline and long-term capability building.
About Crawford & Company (NYSE:CRD.A)
Crawford & Company is a global provider of claims management and related services for the insurance industry, corporations and government entities. The company helps clients manage property and casualty claims from initial assessment through resolution, with services that include loss adjusting, claims administration, catastrophe response, appraisal, subrogation and settlement support.
Through its Broadspire operations, Crawford also provides third-party administration and specialized workers’ compensation, disability and liability claims services.
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