Financial Performance - Consolidated revenues before reimbursements were $982.5 million in 2020, a decrease of 2.3% compared to $1.006 billion in 2019[124] - Net income attributable to Crawford & Company was $28.3 million in 2020, compared to $12.5 million in 2019[124] - Revenues from Crawford Claims Solutions segment increased by 4.9% to $356.4 million in 2020, driven by weather-related activity and new client growth[126] - Revenues from Crawford TPA Solutions segment decreased by 7.3% to $365.0 million in 2020, primarily due to the economic impact of COVID-19[126] - Total revenues before reimbursements for Crawford Claims Solutions increased to $356.4 million in 2020, up 4.9% from $339.8 million in 2019[167] - Total revenues, including reimbursements, amounted to $1,016.2 million in 2020, down 3.0% from $1,047.6 million in 2019[167] - Net income attributable to shareholders increased by 126.6% to $28.3 million in 2020, compared to $12.5 million in 2019[167] - The company reported a net income of $27.1 million in 2020, a 184.2% increase from $9.5 million in 2019[167] Impact of COVID-19 - The company estimates that COVID-19 negatively impacted revenues by $45.0 to $55.0 million in 2020 compared to 2019[127] - Total cases received decreased by 2.4% to 1,561,693 in 2020, with a notable decline in Crawford TPA Solutions and Crawford Specialty Solutions segments[128] - The average full-time equivalent employees (FTEs) in the Crawford TPA Solutions segment decreased from 3,184 in 2019 to 3,081 in 2020, reflecting cost reduction initiatives[187] - The total case volumes for Crawford TPA Solutions decreased by 5.8% in 2020, totaling 765,615 cases, with significant declines in the U.S., Canada, and Europe due to COVID-19[184] - The company anticipates that future case volumes may be negatively impacted due to the economic contraction from the COVID-19 pandemic unless offset by new client programs or weather-related activity[173] Segment Performance - Operating earnings in Crawford Claims Solutions increased to $14.4 million, or 4.0% of revenues before reimbursements, in 2020[132] - Operating earnings for Crawford TPA Solutions segment fell to $21.5 million in 2020, or 5.9% of revenues before reimbursements, down from $27.2 million or 6.9% in 2019[177] - Crawford Specialty Solutions recorded operating earnings of $52.6 million in 2020, representing 20.1% of revenues before reimbursements, an increase from $49.3 million or 18.1% in 2019[190] - Crawford Claims Solutions segment revenues increased by $20.9 million in 2020, representing a 6.2% growth compared to 2019, despite a 1.1% revenue decrease when excluding the WeGoLook case impact[169] Expenses and Costs - Direct compensation, fringe benefits, and non-employee labor are significant operating expenses for the company[155] - Direct expenses for Crawford Claims Solutions increased by 6.0% to $279.0 million in 2020, compared to $263.1 million in 2019[166] - Crawford Claims Solutions segment expenses, excluding reimbursements, decreased from $108.6 million in 2019 to $103.5 million in 2020, reducing as a percentage of segment revenues from 31.9% to 29.0%[176] - Indirect costs, including centralized administrative support costs, are allocated to each segment based on usage[156] - The restructuring costs included $9.4 million in severance expenses and related payroll taxes, and $2.5 million in asset impairment and lease termination costs[143] Acquisitions and Disposals - On October 1, 2020, Crawford acquired an additional 85% equity interest in Crawford Carvallo for an initial cash payment of $11.6 million[140] - The company recognized a pretax gain on disposal of $13.8 million related to the sale of the Lloyd Warwick International business in 2020[139] - A pretax loss on disposal of its subsidiary Garden City Group totaling $20.3 million was reported in 2018[144] Financial Position and Liquidity - As of December 31, 2020, total short-term and long-term debt outstanding was $112.9 million, with an available borrowing capacity of $325.7 million under the Credit Facility[258] - The leverage ratio was 1.11 as of December 31, 2020, down from 1.53 in 2019, indicating improved financial stability[263] - Cash and cash equivalents at the end of 2020 totaled $44.7 million, compared to $51.8 million at the end of 2019[268] - Total liquidity at December 31, 2020, was $251.0 million, consisting of $44.7 million in cash and $206.3 million in additional borrowing capacity[279] Pension and Credit Losses - The aggregate deficit in the funded status of the U.S. Qualified Plan and other international plans totaled $53.9 million at the end of 2020, down from $65.9 million in 2019[292] - The company expects to make discretionary contributions of $9.0 million per annum to the U.S. Qualified Plan for the next five years to improve its funded status[293] - The allowance for expected credit losses was $9.5 million as of December 31, 2020, representing approximately 7.1% of gross billed receivables[313] - If the allowance for expected credit losses changed by 1.0% of gross billed receivables, the impact on consolidated pretax income would have been approximately $1.3 million in 2020[313]
Crawford(CRD_B) - 2020 Q4 - Annual Report