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C&

CRAWFORD & CO (CRD-A)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered modest top-line growth with revenues before reimbursements up 2.8% year over year to $323.0M, while GAAP diluted EPS was $0.16 versus $0.17 in Q2 2024 and up from $0.13 in Q1 2025 .
  • Non-GAAP adjusted EPS was $0.22; adjusted operating earnings were $22.0M and adjusted EBITDA rose to $31.4M with an adjusted EBITDA margin of 9.7% and adjusted operating margin of 6.8% (slightly below prior-year), with management citing lower U.S. property claim frequency as a headwind .
  • International Operations grew revenue 6.6% and expanded operating margin to 7.0%; Platform Solutions revenue fell 9.2% but operating margin improved sharply to 8.9% on mix-shift and cost reductions; Broadspire posted record revenue but lower margin due to higher administrative costs .
  • Board raised the quarterly dividend to $0.075 per share, a potential support catalyst for the stock and a signal of confidence in margin trajectory and liquidity .

What Went Well and What Went Wrong

What Went Well

  • International Operations: Revenue +6.6% YoY to $109.1M with operating margin expansion to 7.0%, driven by strength in the U.K., Europe, and Asia .
  • Platform Solutions margin improvement: Despite a 9.2% revenue decline, operating margin expanded to 8.9% (from 3.8%) on reduced low-value inspection services and lower administrative costs, indicating better business mix and efficiency .
  • Liquidity and capital return: Adjusted EBITDA increased YoY to $31.4M; operating cash flow improved materially YTD ($21.1M provided vs $8.3M used last year). Dividend increased to $0.075 per share .

What Went Wrong

  • Headwinds in U.S. property claims: Management highlighted lower claims frequency pressuring revenue in North America Loss Adjusting and Platform Solutions; NALA operating margin fell to 5.9% (from 6.4%) .
  • Elevated corporate costs: Unallocated corporate costs rose to $7.0M, including a one-time $3.1M indirect tax expense and increased self-insurance reserves, weighing on consolidated margins .
  • Broadspire margin compression: Record revenue ($100.6M) accompanied by operating margin decline to 13.6% (from 15.5%) owing to increased administrative/IT costs and strategic headcount additions .

Financial Results

MetricQ4 2024Q1 2025Q2 2025
Revenues Before Reimbursements ($USD Millions)$347.3 $312.0 $323.0
GAAP Diluted EPS (CRD-A/CRD-B) ($)$0.11 / $0.12 $0.13 / $0.13 $0.16 / $0.16
Non-GAAP Diluted EPS ($)$0.19 $0.21 $0.22
Adjusted Operating Earnings ($USD Millions)$18.7 $17.8 $22.0
Adjusted EBITDA ($USD Millions)$27.9 $26.8 $31.4
Adjusted EBITDA Margin (%)——9.7%
Adjusted Operating Margin (%)——6.8%

Segment performance (revenues before reimbursements and operating earnings):

SegmentQ2 2024 Revenue ($M)Q2 2025 Revenue ($M)Q2 2024 Op. Earnings ($M)Q2 2025 Op. Earnings ($M)
North America Loss Adjusting$76.0 $78.1 $4.9 $4.6
International Operations$102.3 $109.1 $5.7 $7.6
Broadspire$97.1 $100.6 $15.1 $13.7
Platform Solutions$38.8 $35.2 $1.5 $3.1

KPIs (selected, quarterly):

KPIQ2 2024Q2 2025
NALA Total Cases Received59,544 84,647
NALA FTE Employees2,011 2,054
International Total Cases Received121,280 110,579
International FTE Employees3,636 3,524
Broadspire Total Cases Received138,567 140,620
Broadspire FTE Employees2,679 2,803
Platform Solutions Total Cases Received73,365 42,541
Platform Solutions FTE Employees954 776

Balance sheet and cash flow snapshot:

  • Cash and cash equivalents: $58.5M at 6/30/25; total debt $225.4M; net debt $166.9M; leverage ratio 1.75x EBITDA .
  • Operating cash flow YTD: $21.1M provided vs $(8.3)M used in prior-year; Free Cash Flow YTD: $2.6M vs $(26.7)M .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Quarterly Dividend per ShareQ3 2025 payout (Aug 29, 2025)$0.070 $0.075 Raised
Revenue, EPS, Margins, OpEx, OI&E, Tax RateFY/QuarterNot disclosedNot disclosedMaintained (no formal guidance)

Notes:

  • Management reiterated confidence in margin trajectory but did not issue quantitative revenue/EPS guidance; call materials emphasized liquidity and capital allocation .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 and Q1 2025)Current Period (Q2 2025)Trend
Weather-driven demandQ4: Increased claims post Hurricanes Helene/Milton; revenue growth across segments . Q1: Momentum continued; diversified model supports execution .Ongoing volatility; lower U.S. property claim frequency pressured NALA and Platform; diversified mix supports growth .Mixed: global demand strong; U.S. property frequency softer .
International growthQ4: Strong U.K./Europe drove margin expansion . Q1: U.K./Europe led 6% revenue growth .Revenue +6.6%; margin to 7.0% on U.K./Asia strength .Improving margins and growth .
Platform Solutions mix/efficiencyQ4: Weather activity boosted revenue; margin improved . Q1: Improved profitability on efficiency and pricing .Revenue down 9.2%; margin up to 8.9% via mix shift and lower costs .Efficiency gains despite revenue decline .
Broadspire strategyQ4: Record annual revenue; margin expansion YoY . Q1: New client adds; retention strong; investing in talent .Record quarterly revenue; margin lower due to admin/IT investments and headcount for new wins .Growth with near-term margin investment .
Regulatory/tax—One-time $3.1M indirect tax expense in SG&A; increased self-insurance reserves .Cost headwind (non-recurring tax) .
Technology/InsurtechQ4: Emphasized innovation and tech improvements .Insurtech capabilities and partnerships highlighted; diversified model across verticals .Strategic priority maintained .

Management Commentary

  • CEO: “Our second quarter performance was highlighted by consolidated revenue growth driven by increased revenue at three of our four operating segments. We continue to contend with lower claims frequency in U.S. property... Consolidated operating margin of 6.8% was down slightly year over year but improved sequentially... We increased our quarterly dividend to $0.075 reflecting progress and confidence in our margin trajectory.” .
  • CEO: “As we enter the second half of 2025... Our balance sheet and liquidity remain strong... and build momentum as we win more new business across the globe.” .
  • Strategic framing (slides): Multiple growth drivers, market share gains, and Insurtech capabilities; leverage ratio 1.75x; strong balance sheet and liquidity .

Q&A Highlights

  • The company hosted its call on Aug 5, 2025, with slides provided, but a full transcript was not available in the document set. Call details: dial-in 1-800-549-8228, ID 35518; replay available through Aug 12, 2025 .
  • Without a transcript, specific analyst Q&A themes and detailed clarifications are unavailable here; materials emphasize segment performance, margin trajectory, cost items (indirect tax), and capital allocation .

Estimates Context

MetricConsensus (S&P Global)ActualOutcome
Primary EPS (Q2 2025)$0.245*$0.22*MISS*
Revenue (Q2 2025)$330.99M*$323.00M*MISS*
EBITDA (Q2 2025)$33.35M*$27.34M*MISS*

Values retrieved from S&P Global.*

  • Company-reported adjusted EBITDA was $31.4M, reflecting non-GAAP adjustments (depreciation/amortization, interest, taxes, stock-based comp, non-service pension, contingent earnout), which differs from SPGI’s EBITDA actual shown above .
  • Misses versus consensus were primarily tied to lower U.S. property claims frequency impacting NALA and Platform revenues, and higher corporate costs from a one-time indirect tax expense .

Key Takeaways for Investors

  • International Operations is the growth/margin driver (+6.6% revenue; margin to 7.0%), offsetting North America softness from lower U.S. property claims .
  • Platform Solutions’ margin expansion despite revenue decline suggests improving mix and structural efficiency, reducing reliance on lower-value networks services .
  • Broadspire continues to win new business and deliver record revenue; near-term margin pressure from strategic investments likely supports medium-term growth and retention .
  • Corporate cost headwind included a non-recurring $3.1M indirect tax expense; watch for normalization of SG&A and self-insurance reserves in H2 .
  • Liquidity and leverage profile (net debt ~$166.9M; 1.75x EBITDA) and the dividend increase to $0.075 signal balance sheet strength and capital return commitment .
  • Near-term trading: consensus misses on EPS/revenue may weigh on sentiment; dividend raise and sequential margin improvement could temper downside if investors focus on H2 seasonality and weather-related activity .
  • Medium-term: diversified global footprint, Insurtech capabilities, and International momentum underpin the thesis; monitor U.S. property frequency and Platform Solutions client outsourcing trends .