360°
Crawford & Company ® 2015 Annual Report
COMPANY PROFILE
Based in Atlanta, GA, Crawford & Company® (www.crawfordandcompany.com) is one of the world's largest independent providers of claims
management solutions to the risk management and insurance industry as well as self-insured entities, with an expansive global network serving clients
in more than 70 countries. The Crawford Solution™ offers comprehensive, integrated, claims services, business process outsourcing and consulting
services for major product lines including property and casualty claims management, workers' compensation claims and medical management,
and legal settlement administration. The Company’s shares are traded on the NYSE under the symbols CRDA and CRDB.
TABLE OF CONTENTS
02 Message to Shareholders
06 Global Executive Management Team
07 Vision & Values
08 360 Degrees of Global Vision
The Crawford Solution™
1 1
12
14
16
18
24
360 Degrees of Expertise
360 Degrees of Data
2015 Financial Highlights
Condensed Consolidated Financial Statements
Board of Directors
360° 2015 Annual Report
1
CHALLENGES
CAN COME
FROM ANY
DIRECTION.
JUST LIKE
OPPORTUNITY.
With the broadest array
of services in the industry,
Crawford is a true 360°
global claims solutions
provider that can quickly
configure a full range of
solutions for customers –
anywhere and anytime.
2
Crawford & Company 2015 Annual Report
A MESSAGE FROM
THE INTERIM
PRESIDENT & CEO
TO OUR SHAREHOLDERS
I am pleased with the progress that we have made through 2015 and excited with
what the future holds as we work to unleash the tremendous, untapped potential
that I see residing in Crawford & Company. While the market backdrop continues
to be challenging, Crawford’s global position has never been stronger as we
generated almost $1.2 billion in revenues in 2015 while handling 1.6 million claims
around the world.
As we enter 2016, Crawford remains one of the world’s largest independent providers of
claims management solutions with an unparalleled competitive position whose brand is
well recognized globally. Our clients value the complex solutions that we deliver oftentimes
under dire circumstances when speed of execution matters most. Simply put, we partner
with our clients daily to deliver mission critical claims services, business process outsourcing
(BPO), and consulting programs for all aspects of their claims management needs.
While our brand, customer relationships and product solutions are all strong, it is our
financial performance that has lagged expectations in the past. The opportunity we have
is to deliver the vast potential that exists in our company today. While Crawford’s global
competitive position is unmatched, our organization has been slowed by unnecessary costs
and a business structure that has served to limit collaboration and growth. This has been
compounded by a dearth of severe weather, leading our clients to outsource fewer claims
and especially fewer high value, complex claims. Against a backdrop of rising expenses,
this has contributed to margin contraction and disappointing earnings in the past.
360° Message to Shareholders
3
In performing an extensive business review this fall, we identified numerous areas of
redundancy as well as opportunities for productivity and revenue enhancement. Based upon
our findings, we quickly created and implemented a broad restructuring initiative with the
goal of reducing our expense base by $25 million as we strive to restore our profit margins
to their historical levels and better. We are focused on expanding our margins without any
regard or expectations for an improving market. This goal is within our grasp and will provide
operational leverage if the market does improve over time. Importantly, we expect this cost
reduction plan to be seamless with no impact to the high levels of service that we currently
provide to our clients on a daily basis.
The second important finding of our review was the value that our clients place in their
business partnerships with Crawford. Our clients were uniform in their praise of the
Crawford brand and product offerings. What became quickly apparent, however, was the
minimal customer overlap that we currently possess across our business segments. This
represents a real growth opportunity as we look to introduce our full suite of products to our
existing customer base. To that end, we have empowered and incentivized our four business
segment CEOs to collaborate globally in order to cross sell their products and drive improved
revenue growth. This is a key strategic initiative for 2016; and while this effort is nascent, I
can already see an energy and excitement within our leadership team as they begin to work
together to win new business.
At this point, I would like to review the 2015 highlights of our four business segments that
provide claims management, BPO and consulting services to multinational insurance carriers,
brokers, local insurance firms, law firms and governmental agencies, as well as more than
200 of the Fortune® 500 companies.
U.S. Services
Our U.S. Services segment offers property & casualty, liability, marine & aviation, vehicle,
transportation, catastrophe claims management along with contractor managed repair
services (Contractor Connection®), Global Technical Services (GTS®) for large and complex
losses, and Crawford Forensic Accounting Services. U.S. Services enjoyed a strong year of
growth as revenues expanded 13 percent year over year driven by the continued success
in U.S. Contractor Connection and the benefit of an outsourcing project from a major
U.S. insurance carrier. Our cost reduction efforts combined with improved revenue growth
drove operating margins of 13 percent, a 500 basis points expansion from 2014’s result of
eight percent. We see room for expenses to fall further and believe margins have support
at current levels in this difficult environment. This helped to offset the headwind that we
continue to experience from declining weather-related cases. We continue to invest in
GTS and its specialty markets niche areas due to client demand for specialized expertise.
We have reorganized quality review functions to better optimize resources and improve
product delivery. Late in the year we appointed a leader to leverage the statistical analytics
we capture in our Atlanta-based Performance Management Center and to expand its
capabilities. Importantly, our U.S. Contractor Connection business both on the commercial
and consumer side continues to have ample room for continued growth.
4
Crawford & Company 2015 Annual Report
International
Our International segment provides property & casualty claims services, third party
administration services, Contractor Connection, personal lines claims handling and GTS
for large, complex or specialty claims outside the United States. Specialist services include
aviation, marine & transportation, cyber risk, environmental, forensic accounting and
financial risks. Our 2014 acquisition of GAB Robins Holdings UK Limited firmly entrenched
Crawford as the number one claims processor in the U.K. As we worked to integrate the
two companies throughout the year we were proud to renew all major contracts of key GAB
clients. In addition to launching a definitive solution for cyber-related events and partnering
with global insurance carriers to provide this service, we launched financial lines claims
services to support clients in the changing risk and exposure landscape. The end of 2015 and
into 2016 saw a surge of flood claims from various storms impacting the U.K. that continue
to be handled. In Canada, our Contractor Connection business is making progress, and we
will opportunistically expand this offering into new geographic regions in 2016. Our Asia
Pacific region saw strong operating results, and continental Europe showed volume increases
as we exited 2015, boding well for the start of 2016.
Broadspire®
Our Broadspire segment is a leading third party administrator to employers and insurance
companies, offering workers' compensation, casualty claim, medical management, disability
and absence management solutions, and risk management information services, helping
to increase employee productivity and reduce the cost of risk through early intervention,
professional expertise and data analytics. Broadspire delivered another strong year with
revenues increasing nine percent year over year. Operating margins were eight percent,
a 200 basis point expansion from 2014’s result of six percent due to higher revenues and
improved control over operating expenses. Our medical management, disability and absence
management services products continued to gain traction in the market and all contributed
to the robust revenue growth. In addition to launching a liability litigation review service, we
remained focused on enhancing operational efficiency to the benefit of our clients. Our client
retention rate, a key metric in sustainable growth, ended the year at 92 percent.
Garden City Group™
The Garden City Group, LLC (GCG®) is a recognized leader in legal administration for class
action settlements, mass tort matters, bankruptcy cases and legal notice programs. GCG
managed the decline of several large projects through calendar year 2015 which had the
effect of pressuring both revenues and margins. The wind-down of these projects led by the
Deepwater Horizon class action settlement will continue to be a headwind as we enter 2016.
We are pleased with the recent appointment of Kenneth Cutshaw as interim chief executive
officer given his deep experience set which will help GCG work to reduce costs as well as
build its new business pipeline in order to stabilize its financial results.
360° Message to Shareholders
5
Looking forward
As we approach the 75th anniversary of Crawford & Company, I know Jim Crawford, our
founder, would be proud of our progress. I remain optimistic with what the future holds for
our clients, our employees, and our shareholders. We are in the midst of significant change
that will transform Crawford into a company that can deliver more consistent financial results
regardless of the market backdrop. We will also continue to develop our Global Business
Services Centers in Manila, Philippines and Pune, India (the “Centers”). The Manila facility
has already begun to drive improved efficiencies and cost savings in our Broadspire segment.
As we expand the Centers through 2016, we expect to drive further cost savings and margin
expansion across our business segments. The Centers are expected to continue to strengthen
our client service, realize additional operational efficiencies, and provide new capabilities
for growth.
WE ARE IN THE MIDST OF SIGNIFICANT CHANGE THAT WILL
TRANSFORM CRAWFORD INTO A COMPANY THAT CAN DELIVER
MORE CONSISTENT FINANCIAL RESULTS REGARDLESS OF THE
MARKET BACKDROP.
We will also invest back into the business to take advantage of attractive growth
opportunities. Leveraging client relationships across our business segments represents a real
opportunity to expand our product sales and enhance revenue growth.
I am pleased to report that D. Richard Williams joined our Board of Directors in early 2016.
Rick is a retired co-chief executive officer of Primerica, Inc., and remains active as its non-
executive chairman of the Board. He joins Crawford at an integral time in our history and we
welcome his leadership, expertise and guidance.
In conclusion, our goal is to deliver the vast potential that exists in Crawford and to transform
the business for my ultimate successor. We believe that our goals are achievable and would
like to conclude by thanking all of our employees for their hard work and commitment.
Without their tireless efforts this transformation would not be possible.
Sincerely,
Harsha V. Agadi
Interim President and Chief Executive Officer
6
Crawford & Company Global Executive Management Team
C R A W F O R D & C O M P A N Y
GLOBAL EXECUTIVE
MANAGEMENT TEAM
1. Harsha V. Agadi
Interim President and
Chief Executive Officer
2. W. Bruce Swain
Executive Vice President,
Chief Financial Officer
3. Allen W. Nelson
Executive Vice President,
General Counsel, Corporate
Secretary & Chief Administrative Officer
4. Ian V. Muress
Executive Vice President,
Chief Executive Officer,
International
5. Larry C. Thomas
Executive Vice President,
Chief Executive Officer,
U.S. Services
6. Danielle M. Lisenbey
Executive Vice President,
Chief Executive Officer,
Broadspire
7. Kenneth A. Cutshaw
Executive Vice President,
Interim Chief Executive Officer,
Garden City Group
8. Michael F. Reeves
Executive Vice President,
Head of Global Technical Services
9. Brian S. Flynn
Executive Vice President,
Global Chief Information Officer
10. Kenneth M. Fraser
Executive Vice President,
Strategy & Performance Development
11. Bonnie C. Sawdey
Senior Vice President,
Chief People Officer
2
8
5
9
6
10
1
7
11
3
4
360° Vision & Values
7
THE KEYS TO OUR SUCCESS
VISION
& VALUES
VISION
Our vision is to be the world’s leading provider of claim services,
business process outsourcing and consulting solutions. We will
inspire our organization to develop world-class technology and
innovative solutions to clients; to employ the best and brightest
people; and to deliver a strong financial performance.
VALUES
INTEGRITY: Do the right thing, always
COLLABORATION: Leverage collective genius
QUALITY: What we do, we do well
ACCOUNTABILITY: If it’s to be, it’s up to me
INNOVATION: Change is constant
PASSION: Committed in heart and mind
COMMUNICATION: Engage and be in the know
DIVERSITY: As inclusive as our services
LEADERSHIP: Leaders lead
8
Crawford & Company 2015 Annual Report
360 DEGREES OF
GLOBAL VISION
INTERNATIONAL
Our constant aim is to provide the best claims service across a range of geographies
and cultures. We seek to innovate through training our people for the future; designing
process improvements such as Customer First; and developing advanced technology
solutions to enhance analytical capabilities and to support our work on predictive
analytics. We recognize the changing demands of our clients and will align our
approach with ever-rising customer expectation particularly amongst millennials.
— Ian V. Muress
Chief Executive Officer,
International
U.S. SERVICES
Our vision is to be the provider of choice in the markets we serve by being
quality focused and performance driven while centering on our clients’ evolving
needs. We will provide innovative, integrated solutions leveraging highly trained
professionals and technology to deliver consistent prompt quality service that
delivers high customer satisfaction backed by performance metrics.
— Larry C. Thomas
Chief Executive Officer,
U.S. Services
360° of Global Vision
9
BROADSPIRE
Over the last few years, Broadspire has built a solid foundation for
further growth and development allowing for the expansion of its core
services, new innovative solutions, technology advancements and the
continued focus on our most important asset, our employees. As a
leader in our industry, these investments help prepare us for the ever-
changing future landscape.
— Danielle M. Lisenbey
Chief Executive Officer,
Broadspire
GARDEN CITY GROUP
Garden City Group continues to be the settlement administrator of choice for
law firms, corporations, courts, and government agencies. For more than 30
years, GCG’s team of highly trained legal and operations professionals, including
more attorneys than any other administration firm in the industry, has provided
Best In Class® administration services in many of the nation’s largest and most
complex class action, mass tort, data breach and bankruptcy matters. Regardless
of case size or complexity, GCG’s commitment to quality is paramount in every
administration we handle.
— Kenneth A. Cutshaw
Interim Chief Executive Officer,
Garden City Group
10
Crawford & Company 2015 Annual Report
IF YOU THINK
OF US AS JUST
A CLAIMS
PROCESSING
COMPANY,
THINK
AGAIN
Our comprehensive, integrated service
platform is a 360° approach to helping
customers manage risk, reduce costs
and operate more efficiently.
360° The Crawford Solution
11
The Crawford Solution™
360° approach
The Crawford Solution maximizes Crawford's global resources, delivers industry
leading quality and efficiency, and integrates our portfolio of businesses, all of
which helps clients understand the ways Crawford can assist their companies to
become more efficient and profitable.
Claims Services
With the broadest array of services in
the industry, Crawford can administer
virtually any claim function.
ENVIRONMENTAL
RISK SERVICES
WORKERS’
COMP/ EMPLOYERS’
LIABILITY
RISK MANAGEMENT
INFORMATION
Business Process Outsourcing
We can deliver Business Process
Outsourcing (BPO) programs for
all aspects of claims management.
LEGAL SETTLEMENT
ADMIN
PROPERTY
LIABILITY
CATASTROPHE
SERVICES
THIRD PARTY
ADMIN
CLAIMS ADMIN
DISABILITY &
LEAVE MANAGEMENT
ACCIDENT & HEALTH
MEDICAL
MANAGEMENT
MANAGED
PROPERTY REPAIR
CYBER RISK SERVICES
PRODUCT RECALL
RECOVERY/SUBROGATION/
DISPUTE MANAGEMENT
FORENSIC
ACCOUNTING
SERVICES
COUNTER FRAUD
SERVICES
AUDIT
CUSTOMER FIRST
ANALYTICS
MOTOR/AUTO/
SALVAGE
LARGE COMPLEX/
SPECIALTY LOSSES
CRAWFORD IQ™
STAFFING
EDUCATIONAL
SERVICES
FINANCIAL RISKS
MULTINATIONAL
AND GLOBAL
PROGRAMS
PRE- & POST-LOSS
SERVICES
Consulting
We offer and design strategic
assessments for streamlined and
cost-effective solutions for clients.
12
Crawford & Company 2015 Annual Report
360 DEGREES OF
EXPERTISE
Wherever you need us, we’re already there.
1.6
MILLION CLAIMS HANDLED
AROUND THE WORLD
8,900+
EMPLOYEES
460+
EXPERIENCED
SENIOR ADJUSTERS
AND INDUSTRY SPECIALISTS
70+
COUNTRIES WITH
PHYSICAL LOCATIONS
30+
LANGUAGES
360° of Expertise
13
As an independent, international leader of claims administration, Crawford & Company
offers a powerful portfolio of integrated global solutions that adds value and reduces
costs for our clients. With 75 years of industry experience, our practices and procedures
are proven. However, it’s our specialized expertise that allows us to meet and to exceed
specific client needs. A sampling of our expertise includes:
Crawford Global Technical
Services (GTS)
is comprised of experts with the
Broadspire,
a leading third-party
Garden City Group
is the recognized leader in
administrator, offers casualty
legal settlement administration
experience and industry focus
claims, medical management,
services for class action
to evaluate and assess damages
disability and absence
settlements and other claims
for major insurance claim events,
management solutions; accident
administration, bankruptcy cases
often under extreme conditions.
and health services; and risk
and legal noticing programs. The
Covering a broad range of
management information
firm has been engaged in many
industries and geographic
services. These services help
high-profile distribution matters,
regions, our team of strategic
clients increase employee
including the General Motors
loss managers and technical
productivity and reduce the
bankruptcy, the $20 billion Gulf
adjusters is the largest and most
cost of risk through early
Coast Claims Facility, the $6.15
experienced in the world.
intervention, professional
billion WorldCom settlement,
expertise and data analytics.
the $3.4 billion Native American
Trust Settlement and the $3.05
billion VisaCheck/MasterMoney
Antitrust settlement.
Crawford Specialty Markets
is a subset of GTS created to
serve the unique needs of clients
Contractor Connection,
an industry leader in contractor
who require highly technical
managed repair and home
claims handling, including
improvement services, provides
Lloyd’s of London, the London
insurance carriers and consumers
market, and specialty and
a national network of residential
underwriting centers around
and commercial contractors that
the world. Specialty Markets
are vetted and managed for
offers a single solution to meet
performance, measuring
the large, complex and specific
quality, timeliness and
claims needs of clients and their
customer satisfaction.
insureds in niche areas, such as
marine, energy and aviation—
regardless of location.
14
Crawford & Company 2015 Annual Report
360 DEGREES OF
DATA
Data is the lifeblood of business today.
360°
Investment in
Technology
360° of Data
15
Not surprisingly, our clients routinely rank developing business intelligence and
predictive analytics capabilities among their top technology spending initiatives.
Crawford supports our clients by investing continually in technology to deliver
automation, global reporting and intake, advanced process mining and analytics,
as well as security designed to meet the expanding needs of our global client base.
Version 8.0 of our risk management
Crawford continually strives to protect the
information system DMITRI SM was released
confidentiality and data integrity of our
in 2015, and this version demonstrates an
clients’ sensitive and personally-identifiable
intelligent, contextually adaptable interface
information. With the diversity of networks
that, among other features, helps risk
used throughout the world as well as the
managers proactively assess the likelihood
progressive ingenuity of system hackers,
that a claim’s total cost could develop
successfully protecting client data requires
adversely.
Broadspire has analysts and programmers
who work on predicative analytics
both on the macro level, which is used
in claims operations, as well as micro
models developed in collaboration with
our Fortune 500 clients. “Micro triggers”
are being developed to integrate the
continuous review and refinement of
security processes. Crawford takes data
protection very seriously and has invested in
tools and processes to protect sensitive data
that leaves our computing environment
whether through email or electronic data
transmissions. Our encryption tools provide
secure communication for all parties
involved – customers, vendors, and other
predictive models and allows us to produce
partners outside the organization.
customizable models for clients. This
technology is used to put the adjusters
in the best position to make the most
informed decisions and is the way of the
future.
At Crawford’s performance management
centers around the world, claims progress
is tracked in real time through inventory
management of operations trending,
allowing tailored reports to be delivered for
customer utilization.
CIO
100
HONOREE
2015
RECIPIENT OF
CIO MAGAZINE
100 AWARD 2015
SECOND CONSECUTIVE
AWARD FOR DEMONSTRATING
EXCELLENCE AND
ACHIEVEMENT IN
INFORMATION TECHNOLOGY.
NAMED TO 2015
INFORMATIONWEEK
ELITE 100
FOR THE SECOND CONSECUTIVE YEAR NAMED TO
ONE OF THE IT INDUSTRY’S MOST PRESTIGIOUS
AWARDS, THE INFORMATIONWEEK ELITE 100
CORPORATE RANKINGS, WHICH SPOTLIGHTS
THE MOST INNOVATIVE USERS OF INFORMATION
TECHNOLOGY.
16
Crawford & Company 2015 Annual Report
2015 FINANCIAL
HIGHLIGHTS
4
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2011
2012
2013
2014
2015
2011
2012
2013
2014
2015
2011
2012
2013
2014
2015
REVENUES BEFORE(1)
REIMBURSEMENTS
($ in millions)
CASH PROVIDED BY
OPERATING ACTIVITIES
($ in millions)
CONSOLIDATED
OPERATING EARNINGS(1)
($ in millions)
6
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2011
2012
2013
2014
2015
2011
2012
2013
2014
2015
2011
2012
2013
2014
2015
CASES RECEIVED
(in thousands)
TOTAL CASH DIVIDENDS PAID
($ in millions)
NET DEBT(1)
($ in millions)
(1) Measurements of financial performance not calculated in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) should be
considered as supplements to, and not substitutes for, performance measurements calculated or derived in accordance with GAAP. Any such
measures are not necessarily comparable to other similarly-titled measurements employed by other companies. For additional information about
the non-GAAP financial information presented herein, see the Appendix shown on our website at crawfordandcompany.com/media/2019834/
summaryannualreportappendix_2015.pdf
360° 2015 Financial Highlights
17
FOR THE YEARS ENDED DECEMBER 31,
(dollars in millions, except per share amounts)
(unaudited)
Revenues Before Reimbursements (1)
Net (Loss) Income Attributable to Shareholders of Crawford & Company
Cash Provided by Operating Activities
Diluted (Loss) Earnings per Share – CRDA
Diluted (Loss) Earnings per Share – CRDB
Return on Average Shareholders’ Investment
2015
2014
$
$
$
$
$
1,170.4
(45.5)
61.7
(0.79)
(0.87)
$
$
$
$
$
1,142.9
30.6
6.6
0.57
0.52
( 31.7)%
16.4%
U.S. SERVICES
20.7%
INTERNATIONAL
43.3%
Percentage of Total
Company Revenues
Before Reimbursement
by Business Segment
GARDEN CITY GROUP
11.0%
BROADSPIRE
25.0%
18
Crawford & Company 2015 Annual Report
CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS (unaudited)
(In thousands, except per share amounts)
FOR THE YEAR ENDED DECEMBER 31,
2015
2014
2013
Revenues from Services:
Revenues before reimbursements
Reimbursements
Total Revenues
Costs and Expenses:
Costs of services provided, before reimbursements
Reimbursements
Total costs of services
Selling, general, and administrative expenses
Corporate interest expense, net of interest income of $600, $781, and $768,
respectively
Goodwill impairment charges
Restructuring and special charges
Total Costs and Expenses
Other Income
(Loss) Income Before Income Taxes
Provision for Income Taxes
Net (Loss) Income
Net Loss (Income) Attributable to Noncontrolling Interests
Net (Loss) Income Attributable to Shareholders of Crawford & Company
(Loss) Earnings Per Share - Basic:
Class A Common Stock
Class B Common Stock
(Loss) Earnings Per Share - Diluted:
Class A Common Stock
Class B Common Stock
Weighted-Average Shares Used to Compute Basic (Loss) Earnings Per Share:
Class A Common Stock
Class B Common Stock
Weighted-Average Shares Used to Compute Diluted (Loss) Earnings Per Share:
Class A Common Stock
Class B Common Stock
Cash Dividends Per Share:
Class A Common Stock
Class B Common Stock
$ 1,170,385
71,135
1,241,520
$
1,142,851
74,112
1,216,963
$ 1,163,445
89,985
1,253,430
869,217
71,135
940,352
241,602
8,383
49,314
34,395
1,274,046
753
(31,773)
13,832
(45,605)
117
(45,488)
(0.79)
(0.87)
(0.79)
(0.87)
30,596
24,690
30,596
24,690
$
$
$
$
$
840,702
74,112
914,814
237,880
6,031
—
—
1,158,725
1,650
59,888
28,780
31,108
(484)
30,624
0.58
0.52
0.57
0.52
30,237
24,690
30,983
24,690
$
$
$
$
$
846,442
89,985
936,427
232,307
6,423
—
—
1,175,157
2,829
81,102
29,766
51,336
(358)
50,978
0.95
0.91
0.93
0.90
29,853
24,690
30,855
24,690
$
$
$
$
$
$
$
0.28
0.20
$
$
0.24
0.18
$
$
0.18
0.14
This financial information should be read with the Company’s audited consolidated financial statements and notes thereto, and related risks included in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission.
360° Condensed Consolidated Financial Statements
19
CONDENSED CONSOLIDATED STATEMENTS
OF COMPREHENSIVE (LOSS) INCOME (unaudited)
(In thousands)
YEAR ENDED DECEMBER 31,
Net (Loss) Income
Other Comprehensive (Loss) Income:
Net foreign currency translation loss, net of tax benefit of $0, $91, and $0,
respectively
Amounts reclassified into net income for defined benefit pension plans,
net of tax provision of $3,265, $3,039, and $4,220, respectively
Net unrealized gain (loss) on defined benefit plans arising during the year,
net of tax (provision) benefit of $(2,349), $25,746, and ($13,846), respectively
Other Comprehensive (Loss) Income
Comprehensive (Loss) Income
Comprehensive loss (income) attributable to noncontrolling interests
Comprehensive (Loss) Income Attributable to Shareholders of Crawford & Company $
2015
2014
2013
$
(45,605)
$
31,108
$
51,336
(20,426)
(8,600)
(4,283)
10,806
8,636
8,834
8,209
(1,411)
(47,016)
855
(46,161)
(43,181)
(43,145)
(12,037)
(87)
(12,124)
$
15,671
20,222
71,558
(309)
71,249
$
This financial information should be read with the Company’s audited consolidated financial statements and notes thereto, and related risks included in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission.
20
Crawford & Company 2015 Annual Report
CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS (unaudited)
(In thousands)
FOR THE YEAR ENDED DECEMBER 31,
2015
2014
2013
Cash Flows from Operating Activities:
Net (loss) income
Reconciliation of net income to net cash provided by operating activities:
Depreciation and amortization
Impairment of goodwill
Deferred income taxes
Gain on sale of interest in former corporate headquarters property
Stock-based compensation costs
(Gain) loss on disposals of property and equipment, net
Changes in operating assets and liabilities, net of effects of acquisitions and
dispositions:
Accounts receivable, net
Unbilled revenues, net
Accrued or prepaid income taxes
Accounts payable and accrued liabilities
Deferred revenues
Accrued retirement costs
Prepaid expenses and other operating activities
Net cash provided by operating activities
Cash Flows from Investing Activities:
Acquisitions of property and equipment
Proceeds from disposals of property and equipment
Capitalization of computer software costs
Proceeds from sale of interest in former corporate headquarters property
Cash surrendered from sale of business
Payments for business acquisitions, net of cash acquired
Net cash used in investing activities
Cash Flows from Financing Activities:
Cash dividends paid
Payments related to shares received for withholding taxes under stock-based
compensation plans
Proceeds from shares purchased under employee stock-based compensation plans
Repurchases of common stock
Increase in short-term and revolving credit facility borrowings
Payments on short-term and revolving credit facility borrowings
Payments on capital lease obligations and long-term debt
Capitalized loan costs
Dividends paid to noncontrolling interests
Net cash provided by (used in) financing activities
Effects of exchange rate changes on cash and cash equivalents
Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Year
Cash and Cash Equivalents at End of Year
$
(45,605)
$
31,108
$
51,336
43,498
49,314
4,120
—
3,229
(356)
26,526
3,053
5,948
(21,151)
363
(16,402)
9,118
61,655
(12,144)
—
(20,775)
—
—
(68,259)
(101,178)
37,644
—
15,189
(836)
1,189
(239)
(24,358)
(1,216)
3,099
(23,100)
(4,645)
(18,497)
(8,732)
6,606
(12,485)
1,289
(16,712)
836
(1,554)
(3,141)
(31,767)
33,903
—
15,625
—
3,835
273
2,102
16,528
(2,160)
(22,328)
(5,895)
(22,086)
6,711
77,844
(14,037)
—
(16,976)
—
—
(2,515)
(33,528)
(13,511)
(11,717)
(8,840)
(479)
1,320
(1,240)
147,509
(62,017)
(1,993)
(1,299)
(401)
67,889
(4,756)
23,610
52,456
76,066
(2,085)
1,270
(3,390)
121,110
(98,821)
(856)
(218)
(761)
4,532
(2,868)
(23,497)
75,953
52,456
$
$
(1,322)
1,884
(3,631)
88,460
(99,461)
(15,823)
(30)
(369)
(39,132)
(388)
4,796
71,157
75,953
$
This financial information should be read with the Company’s audited consolidated financial statements and notes thereto, and related risks included in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission.
360° Condensed Consolidated Financial Statements
21
CONDENSED CONSOLIDATED
BALANCE SHEETS (unaudited)
(In thousands)
DECEMBER 31,
ASSETS
Current Assets:
Cash and cash equivalents
Accounts receivable, less allowance for doubtful accounts of $13,133 and $10,960, respectively
Unbilled revenues, at estimated billable amounts
Income taxes receivable
Prepaid expenses and other current assets
Total Current Assets
Property and Equipment:
Property and equipment
Less accumulated depreciation
Net Property and Equipment
Other Assets:
Goodwill
Intangible assets arising from business acquisitions, net
Capitalized software costs, net
Deferred income tax assets
Other noncurrent assets
Total Other Assets
TOTAL ASSETS
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities:
Short-term borrowings
Accounts payable
Accrued compensation and related costs
Self-insured risks
Income taxes payable
Deferred income taxes
Deferred rent
Other accrued liabilities
Deferred revenues
Current installments of capital leases
Total Current Liabilities
Noncurrent Liabilities:
Long-term debt and capital leases, less current installments
Deferred revenues
Self-insured risks
Accrued pension liabilities
Other noncurrent liabilities
Total Noncurrent Liabilities
Shareholders' Investment:
Class A common stock, $1.00 par value, 50,000 shares authorized; 30,537 and 30,497 shares issued
and outstanding, respectively
Class B common stock, $1.00 par value, 50,000 shares authorized; 24,690 shares issued and outstanding
Additional paid-in capital
Retained earnings
Accumulated other comprehensive loss
Shareholders' Investment Attributable to Shareholders of Crawford & Company
Noncontrolling interests
Total Shareholders' Investment
TOTAL LIABILITIES AND SHAREHOLDERS' INVESTMENT
2015
2014
$
76,066
164,596
98,659
4,255
26,601
370,177
140,383
(102,331)
38,052
95,616
104,861
79,996
47,371
47,333
375,177
$ 783,406
$
19,958
44,615
68,843
14,122
4,419
—
13,303
44,577
46,552
1,959
258,348
225,365
26,592
9,354
121,732
17,664
400,707
$
$
$
52,456
180,096
103,163
2,779
29,089
367,583
143,273
(102,414)
40,859
131,885
75,895
75,536
66,927
30,634
380,877
789,319
2,002
48,597
82,151
14,491
2,618
14,523
13,576
35,784
45,054
763
259,559
154,046
26,706
10,041
142,343
17,271
350,407
30,537
24,690
41,936
239,161
(222,631)
113,693
10,658
124,351
$ 783,406
30,497
24,690
38,617
301,091
(221,958)
172,937
6,416
179,353
789,319
$
This financial information should be read with the Company’s audited consolidated financial statements and notes thereto, and related risks included in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission.
22
Crawford & Company 2015 Annual Report
CONDENSED CONSOLIDATED STATEMENTS
OF SHAREHOLDERS' INVESTMENT (unaudited)
(In thousands)
Balance at December 31, 2012
Net income
Other comprehensive
income (loss)
Cash dividends paid
Stock-based compensation
Repurchases of common
stock
Shares issued in connection
with stock-based
compensation plans, net
Increase in value of
noncontrolling interest
due to acquisition of
controlling interest
Dividends paid to
noncontrolling interests
Balance at December 31, 2013
Net income
Other comprehensive loss
Cash dividends paid
Stock-based compensation
Repurchases of common
stock
Shares issued in connection
with stock-based
compensation plans, net
Decrease in value of
noncontrolling interest
due to sale of controlling
interest
Dividends paid to
noncontrolling interests
Balance at December 31, 2014
Net loss
Other comprehensive loss
Cash dividends paid
Stock-based compensation
Repurchases of common
stock
Shares issued in connection
with stock-based
compensation plans, net
Increase in value of
noncontrolling interest
due to acquisition of
controlling interest
Dividends paid to
noncontrolling interests
Balance at December 31, 2015
Class A
Non-Voting
$ 29,335
—
—
—
—
(553)
1,093
—
—
29,875
—
—
—
—
(409)
1,031
—
—
30,497
—
—
—
—
(517)
557
—
—
—
—
—
—
—
—
24,690
—
—
—
—
—
—
—
—
24,690
—
—
—
—
—
—
—
Common Stock
Class B
Voting
Additional
Paid-In
Capital
Accumulated
Accumulated
Other
Other
Comprehensive
Comprehensive
(Loss) Income
(Loss) Income
Retained
Earnings
Shareholders'
Shareholders'
Investment
Investment
Attributable to
Attributable to
Shareholders
Shareholders
of Crawford &
of Crawford &
Company
Company
Noncontrolling
Noncontrolling
Interests
Interests
Total
Total
Shareholders'
Shareholders'
Investment
Investment
$ 24,690
—
$ 35,550
—
$ 246,105
50,978
$ (199,481)
—
$ 136,199
50,978
$ 5,600
358
$ 141,799
51,336
—
—
3,835
—
(8,840)
—
20,271
—
—
20,271
(8,840)
3,835
(49)
—
—
20,222
(8,840)
3,835
—
(3,078)
—
—
—
—
(100)
—
—
39,285
—
—
—
1,189
(1,857)
—
—
38,617
—
—
—
3,198
—
285,165
30,624
—
(11,717)
—
—
(179,210)
—
(42,748)
—
—
—
(2,981)
—
301,091
(45,488)
—
(13,511)
—
—
(221,958)
—
(673)
—
—
—
(2,931)
121
—
—
—
—
—
—
—
—
—
—
—
—
(3,631)
993
—
—
(3,631)
993
—
2,188
2,188
—
199,805
30,624
(42,748)
(11,717)
1,189
(3,390)
(826)
(369)
7,728
484
(397)
—
—
—
—
(369)
207,533
31,108
(43,145)
(11,717)
1,189
(3,390)
(826)
—
(638)
(638)
—
172,937
(45,488)
(673)
(13,511)
3,198
(3,448)
678
(761)
6,416
(117)
(738)
—
—
—
—
(761)
179,353
(45,605)
(1,411)
(13,511)
3,198
(3,448)
678
—
5,498
5,498
—
$ 30,537
—
$ 24,690
—
$ 41,936
—
$ 239,161
—
—
$ (222,631) $ 113,693
(401)
$ 10,658
(401)
$ 124,351
This financial information should be read with the Company’s audited consolidated financial statements and notes thereto, and related risks included in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission.
360° Condensed Consolidated Financial Statements
23
SELECTED FINANCIAL DATA (unaudited)
The following selected financial data should be read in conjunction with Item 7, "Management's Discussion and Analysis of Financial Condition and Results
of Operations" and the audited consolidated financial statements and notes thereto contained in Item 8, "Financial Statements and Supplementary Data"
included in the Company's Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission.
(In thousands, except per share amounts and percentages)
YEAR ENDED DECEMBER 31,
2015
2014
2013
2012
2011
Revenues before Reimbursements
Reimbursements
Total Revenues
Total Costs of Services
U.S. Services Operating Earnings (1)
International Operating Earnings (1)
Broadspire Operating Earnings (Loss) (1)
Garden City Group Operating Earnings (1)
Unallocated Corporate and Shared Costs and
Credits, Net
Net Corporate Interest Expense
Stock Option Expense
Amortization of Customer-Relationship Intangible
Assets
Goodwill Impairment Charges
Restructuring and Special (Charges) Credits
Income Taxes
Net Loss (Income) Attributable to Noncontrolling
Interests
Net (Loss) Income Attributable to Shareholders of
Crawford & Company
(Loss) Earnings Per CRDB Share (2):
Basic
Diluted
Current Assets
Total Assets
Current Liabilities
Long-Term Debt, Less Current Installments
Total Debt
Shareholders' Investment Attributable to
Shareholders of Crawford & Company
Total Capital
Current Ratio
Total Debt to Total Capital Ratio
Return on Average Shareholders' Investment
Cash Provided by Operating Activities
Cash Used in Investing Activities
Cash Provided By (Used in) Financing Activities
Shareholders' Investment Attributable to
Shareholders of Crawford & Company Per
Diluted Share
Cash Dividends Per Share:
CRDA
CRDB
Weighted-Average Shares and Share-Equivalents:
Basic
Diluted
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
1,170,385
71,135
1,241,520
940,352
32,702
18,799
24,017
11,507
$
1,142,851
74,112
1,216,963
914,814
18,039
25,344
15,469
22,849
$
1,163,445
89,985
1,253,430
936,427
11,895
38,795
8,245
46,752
(16,605)
(8,383)
(433)
(9,668)
(49,314)
(34,395)
(13,832)
(8,582)
(6,031)
(859)
(6,341)
—
—
(28,780)
(10,829)
(6,423)
(948)
(6,385)
—
—
(29,766)
1,176,717
89,421
1,266,138
936,059
13,164
47,195
21
60,284
(10,504)
(8,607)
( 408)
(6,373)
—
(11,332)
(33,686)
$
1,125,355
86,007
1,211,362
917,929
11,918
36,185
(11,417)
51,307
(9,403)
(15,911)
(450)
(6,177)
—
2,379
(12,739)
117
(484)
(358)
(866)
(288)
$
(45,488)
$
30,624
(0.87)
(0.87)
370,177
783,406
258,348
225,365
247,282
$
$
$
$
$
$
$
0.52
0.52
367,583
789,319
259,559
154,046
156,811
$
$
$
$
$
$
$
$
50,978
0.91
0.90
369,681
790,058
317,393
101,779
137,645
$
$
$
$
$
$
$
$
48,888
$
45,404
0.88
0.87
386,765
847,415
318,174
152,293
166,406
0.84
$
$
0.83
$ 369,549
818,477
$
286,749
$
211,983
$
214,187
$
$
$
113,693
360,975
1.4:1
68.5%
(31.7)%
61,655
(101,178)
67,889
$
$
$
6,606
(31,767)
4,532
2.06
0.28
0.20
$
$
$
3.11
0.24
0.18
$
$
172,937
329,748
1.4:1
47.6%
16.4%
199,805
337,450
1.2:1
40.8%
30.3%
$
136,199
$ 302,605
1.2:1
55.0%
36.3%
$
$
$
$
$
$
$
$
77,844
(33,528)
(39,132)
3.60
0.18
0.14
$
$
$
$
$
$
92,853
( 33,803)
( 64,918)
2.48
0.20
0.16
$
$
$
$
$
$
133,472
347,659
1.3:1
61.6%
40.7%
36,676
(34,933)
(17,964)
2.46
0.10
0.08
55,286
55,286
54.927
55,673
54,543
55,545
54,229
54,965
53,517
54,246
(1) This is a segment financial measure calculated in accordance with ASC Topic 280, "Segment Reporting," and representing segment earnings (loss) before certain unallocated
corporate and shared costs and credits, net corporate interest expense, stock option expense, amortization of customer-relationship intangible assets, goodwill impairment,
restructuring and special charges and credits, income taxes, and net loss or income attributable to noncontrolling interests.
(2) The Company computes (loss) earnings per share of CRDA and CRDB using the two-class method, which allocates the undistributed (loss) earnings for each period to each
class on a proportionate basis. The Company's Board of Directors has the right, but not the obligation, to declare higher dividends on the non-voting CRDA shares than on
the voting CRDB shares, subject to certain limitations. In periods when the dividend is the same for CRDA and CRDB or when no dividends are declared or paid to either class,
the two-class method generally will yield the same (loss) earnings per share for CRDA and CRDB.
24
Crawford & Company Board of Directors
C R A W F O R D & C O M P A N Y
BOARD OF
DIRECTORS
1. Harsha V. Agadi
Interim President
and Chief Executive Officer,
Crawford & Company
2. P. George Benson
Retired President,
College of Charleston
3. Jesse C. Crawford
Chief Executive Officer,
Crawford Media Services, Inc.
4. Jesse C. Crawford, Jr
Independent Investor
5. Roger A.S. Day
Retired Executive,
ACE American Insurance Company
6. James D. Edwards
Retired Partner,
Arthur Andersen, LLP
7. Joia M. Johnson
Executive Vice President, General Counsel
and Corporate Secretary,
Hanesbrands, Inc.
8. Charles H. Ogburn
Non-Executive Chairman of the Board,
Crawford & Company
9. D. Richard Williams
Non-Executive Chairman of the Board,
Primerica, Inc
9
5
4
1
6
3
8
2
7
Corporate Information
CORPORATE HEADQUARTERS
1001 Summit Boulevard
Atlanta, Georgia 30319
404.300.1000
INQUIRIES
Individuals seeking financial data should contact:
W. Bruce Swain
Investor Relations
Chief Financial Officer
404.300.1051
TRANSFER AGENT
Wells Fargo Shareowner Services
P.O. Box 64854
St. Paul, Minnesota 55164-0854
1.800.468.9716
shareowneronline.com
INTERNET ADDRESS
www.crawfordandcompany.com
CERTIFICATIONS
In 2015, Crawford & Company’s chief executive officer (CEO) provided
FORM 10-K
A copy of the Company’s annual report on Form 10-K as filed with the
to the New York Stock Exchange the annual CEO certification
regarding Crawford’s compliance with the New York Stock Exchange’s
Securities and Exchange Commission is available without charge upon
corporate governance listing standards. In addition, Crawford’s CEO
request to:
Allen W. Nelson
General Counsel, Corporate Secretary,
and Chief Administrative Officer
Crawford & Company
1001 Summit Boulevard
Atlanta, Georgia 30319
404.300.1021
Our Form 10-K is also available online at either www.sec.gov or in the
Investor Relations section at www.crawfordandcompany.com
ANNUAL MEETING
The Annual Meeting of shareholders will be held at 2:00 p.m. on
May 11, 2016, at the corporate headquarters of
Crawford & Company
1001 Summit Boulevard
Atlanta, Georgia 30319
404.300.1000
COMPANY STOCK
Shares of the Company’s two classes of common stock are traded
on the NYSE under the symbols CRDA and CRDB, respectively. The
Company's two classes of stock are substantially identical, except
with respect to voting rights and the Company’s ability to pay greater
cash dividends on the non-voting Class A Common Stock than on
the voting Class B Common Stock, subject to certain limitations. In
addition, with respect to mergers or similar transactions, holders of
Class A Common Stock must receive the same type and amount of
consideration as holders of Class B Common Stock, unless different
consideration is approved by the holders of 75 percent of the Class A
Common Stock, voting as a class.
and chief financial officer filed with the U.S. Securities and Exchange
Commission all required certifications regarding the quality of
Crawford’s public disclosures in its fiscal 2015 reports.
FINANCIAL INFORMATION
The financial information contained herein should not be considered a
substitute for the Company's audited financial statements, inclusive of
footnotes and Managemement's Discussion and Analysis of Financial
Condition and Results of Operations, included in the Company's
annual report on Form 10-K, as filed with the Securities and Exchange
Commission. The Form 10-K also contains detailed discussions of
certain major uncertainties, contingencies, risks, and other issues the
Company faces. A copy of the Form 10-K including the full financial
statements, can be obtained by calling 404.300.1021 or accessing it
online at either www.sec.gov or in the Investor Relations section at
www.crawfordandcompany.com.
FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements, including statements
about the future financial condition, results of operations and earnings
outlook of Crawford & Company. Statements, both qualitative
and quantitative, that are not statements of historical fact may be
“forward-looking statements” as defined in the Private Securities
Litigation Reform Act of 1995 and other securities laws. Forward-
looking statements involve a number of risks and uncertainties that
could cause actual results to differ materially from historical experience
or Crawford & Company's present expectations. Accordingly, no
one should place undue reliance on forward-looking statements,
which speak only as of the date on which they are made. Crawford &
Company does not undertake to update forward-looking statements
to reflect the impact of circumstances or events that may arise or not
arise after the date the forward-looking statements are made. For
further information regarding Crawford & Company, and the risks
and uncertainties involved in forward-looking statements, please
read Crawford & Company's reports filed with the SEC and available
at www.sec.gov or in the Investor Relations section of Crawford &
Company’s website at www.crawfordandcompany.com.
B ROADS PI RE ® CO NTR ACTO R CO N N ECTIO N ® E D U CATIO N AL SE RVIC ES GCG ® GLO BAL TEC H N ICAL SE RVIC ES TM
PRO PE RTY & CASUALTY RISK SC I E N C ES G RO U P ® S PEC IALIST LIAB I LITY SE RVIC ES TM
Crawford & Company ® 2015 Annual Report
Crawford & Company • 1001 Summit Boulevard, Atlanta, GA 30319 • An equal opportunity employer