Crawford & Company, an independent provider of claims management solutions to insurance companies and self-insured entities, announced its financial results for the second quarter ended June 30.
In a release on August 6, the Company noted that second quarter 2012 consolidated revenues before reimbursements totaled $293.8 million, an increase of 1 percent from $291.7 million in the 2011 second quarter. Second quarter 2012 net income attributable to Crawford & Company was $10.4 million, compared with $13.5 million recorded in the 2011 second quarter. Second quarter 2012 diluted earnings per share were $0.19 for CRDA and $0.18 for CRDB, compared with diluted earnings per share for each class of $0.25 in the prior- year quarter.
The difference in earnings per share between CRDA and CRDB for the 2012 second quarter and year-to-date period is due to the payment of a higher per share dividend on CRDA than CRDB, and the impact that has on the earnings per share calculation according to generally accepted accounting principles. Further references in this release will generally be only to CRDB, as that presents a more dilutive measure.
During the 2012 second quarter, the Company incurred pretax special charges of approximately $1.6 million, or $0.02 per share of CRDA and CRDB after related income taxes, related to a project to outsource certain aspects of the U.S. technology infrastructure. The Company expects this project to continue through the 2012 third quarter, with estimated additional pretax costs of $300,000. There were no special charges during the 2011 second quarter.
The Company's consolidated cash and cash equivalents position as of June 30, totaled $45.7 million, compared with $77.6 million at December 31, 2011 and $37.2 million at June 30, 2011.
Crawford used $26.4 million of cash in operations during the 2012 year-to-date period, compared with $33.2 million during the comparable 2011 period. The $6.8 million reduction in cash used in operations was largely due to decreased contributions to the Company's retirement plans, partially offset by lower net income and higher unbilled revenues.
Jeffrey T. Bowman, chief executive officer of Crawford & Company, stated, "Our second quarter 2012 operating results reflected continued improvement in our Broadspire operation aided by strong results in our EMEA/AP and Legal Settlement Administration segments. We continued to experience declines in our Americas segment from last year's second quarter as a result of relatively mild weather in the U.S. and Canada over the first half of this year.
"During the 2012 second quarter our Legal Settlement Administration segment was awarded responsibility for the Deepwater Horizon class action settlement which extended our engagement in this area. We expect activity in this special project to continue to be an important engagement for the Company for the remainder of 2012.
"In the Broadspire segment, we continued to see improvement, as we have reduced losses by over $6.0 million for the year-to-date period. Although we fell slightly short in the 2012 second quarter, we are driving a return to profitability through the remainder of 2012. The turnaround of Broadspire remains one of the key objectives for our management team and we are optimistic for the remainder of the year.
"Our EMEA/AP segment results were driven largely by the ongoing handling of catastrophic flood losses in Thailand, as well as activity related to the completion of weather-related claims in Australia and improvement in our continental European operating results.
"Our U.S. and Canadian property and casualty operations saw a decline in case referrals during the 2012 second quarter, as relatively mild weather reduced industry-wide claim volumes, continuing the trend we have experienced over the last two quarters. However, our Contractor Connection unit saw strong growth in referrals during the 2012 second quarter."
Bowman concluded, "We remain focused on our core strategic and operational goals and expect to expand market share, drive efficiencies and capitalize on emerging opportunities in all our operations during the balance of the year. We are encouraged by the results we are seeing thus far in 2012 and are pleased to be able to increase our guidance for the remainder of the year."
Based in Atlanta, Georgia, Crawford & Company is an independent provider of claims management solutions to the risk management and insurance industry as well as self-insured entities.
((Comments on this story may be sent to email@example.com))