Crawford & Co (CRD.A) 2024 Q2 法說會逐字稿

Good morning. My name is Julie and I will be your conference facilitator today. At this time, I would like to welcome everyone to the Crawford & Company second-quarter 2024 earnings release conference call.

早安.我叫朱莉，今天我將擔任你們的會議主持人。此時此刻，我歡迎大家參加 Crawford & Company 2024 年第二季財報發布電話會議。

In conjunction with that call, a supplementary financial presentation is available on our website at www.crawco.com under the Investor Relations section. (Operator Instructions) As a reminder, ladies and gentlemen, this conference is being recorded today, Tuesday, August 06, 2024.

與該電話會議一起，我們的網站 www.crawco.com 的「投資者關係」部分還提供了補充財務演示。（操作員說明）女士們先生們，謹此提醒，本次會議將於今天（2024 年 8 月 6 日星期二）錄製。

Now, I would like to introduce Tami Stevenson, Crawford and Company's General Counsel.

現在，我想介紹克勞福德公司的總法律顧問塔米史蒂文森。

Thank you, Julie. Some of the matters to be discussed in this conference call and in the supplementary financial presentation may include forward-looking statements that involve risks and uncertainties.

謝謝你，朱莉。本次電話會議和補充財務報告中討論的一些事項可能包括涉及風險和不確定性的前瞻性陳述。

These statements may relate to, among other things, our expected future operating results and financial condition, our ability to grow revenues and reduce our operating expenses, expectations regarding our anticipated contributions to our underfunded defined benefit pension plans, collectability of our billed and unbilled account receivables, financial results from our recently completed acquisitions, our continued compliance with the financial and other covenants contained in our financing agreements, our long-term capital resource and liquidity requirements, and our ability to pay dividends in the future.

除其他事項外，這些陳述可能與我們預期的未來經營業績和財務狀況、我們增加收入和減少營運費用的能力、對我們對資金不足的固定福利退休金計劃的預期繳款的預期、我們的計費和未計費帳戶的可收回性等相關。要求，以及我們未來支付股利的能力。

The company's actual results achieved in future quarters could differ materially from the results that may be implied by such forward-looking statements. The company undertakes no obligation to publicly release revisions to any forward-looking statements made in this conference call to reflect events or circumstances occurring after the date of the call or to reflect the occurrence of anticipated events.

該公司在未來幾季取得的實際業績可能與此類前瞻性陳述所暗示的結果有重大差異。該公司沒有義務公開發布對本次電話會議中所做的任何前瞻性陳述的修訂，以反映電話會議日期之後發生的事件或情況或反映預期事件的發生。

In addition, you are reminded that operating results for any historical period are not necessarily indicative of results to be expected for any future period.

此外，請注意，任何歷史時期的經營績效並不一定代表任何未來時期的預期績效。

For a complete discussion regarding factors which could affect the company's financial performance, please refer to the company's Form 10-Q for the quarter ended March 30, 2024, filed with the Securities and Exchange Commission, particularly the information under heading Risk Factors and Management's Discussion and Analysis of Financial Condition and Results of Operations as well as subsequent company filings with the SEC.

有關可能影響公司財務業績的因素的完整討論，請參閱公司向美國證券交易委員會提交的截至 2024 年 3 月 30 日的季度 10-Q 表格，特別是“風險因素和管理層討論”標題下的信息財務狀況和營運結果分析以及隨後向SEC 提交的公司文件。

This presentation also includes certain non-GAAP financial measures as defined under the SEC rules. As required, a reconciliation is provided for those measures to the most directly comparable GAAP measures.

本簡報還包括根據 SEC 規則定義的某些非 GAAP 財務指標。根據需要，為這些指標提供了與最直接可比較的公認會計準則指標的調節表。

I would like now to introduce Mr. Rohit Verma, Chief Executive Officer of Crawford & Company. Rohit, you may begin.

現在我想介紹克勞福德公司執行長羅希特·維爾馬先生。羅希特，你可以開始了。

Thank you, Tami. Good morning and welcome to our Second Quarter 2024 Earnings Call. Joining me today is Bruce Swain, our Chief Financial Officer and Tami Stevenson, our General Counsel.

謝謝你，塔米。早安，歡迎參加我們的 2024 年第二季財報電話會議。今天加入我的是我們的財務長 Bruce Swain 和我們的總法律顧問 Tami Stevenson。

Before we start today, the Board and I would like to give a warm welcome to our new Director, Joel Murphy. Additionally, we would like to thank departing Board Members, Charlie Ogburn and Michelle Jarrard for their service to Crawford & Company. We look forward to collaborating with Joel and wish Charlie and Michelle very well.

在今天開始之前，董事會和我謹熱烈歡迎我們的新任董事喬爾墨菲 (Joel Murphy)。此外，我們也要感謝即將離任的董事會成員 Charlie Ogburn 和 Michelle Jarrard 對 Crawford & Company 的服務。我們期待與喬爾的合作，並祝福查理和米歇爾一切順利。

The second quarter 2024 demonstrated the continued strength of our core non-weather businesses, which delivered strong performances. Although we did continue to see the impact of benign weather reflected in revenues of weather related business, today I will take you through the operational highlights of the quarter and then I will turn over to Bruce for a deeper review of the financial results for the second quarter.

2024 年第二季展現了我們核心非天氣業務的持續實力，並取得了強勁的業績。Although we did continue to see the impact of benign weather reflected in revenues of weather related business, today I will take you through the operational highlights of the quarter and then I will turn over to Bruce for a deeper review of the financial results for the second四分之一.

As most of you know, Crawford is a leading publicly traded claims management provider handling over $20 billion in claims annually across 70 countries and we serve a well-known base of clients, including some of the most recognizable names in the industry.

正如大多數人所知，Crawford 是一家領先的公開交易索賠管理提供商，每年處理 70 個國家/地區超過 200 億美元的索賠，我們為知名客戶群提供服務，其中包括一些業內最知名的公司。

With a workforce of around 10,000 skilled professionals and tens of thousands of field resources, our extensive scale and global reach distinguish us in a fragmented market, positioning us as a preferred partner for top carriers, many of whom are longstanding customers.

我們擁有約10,000 名熟練的專業人員和數以萬計的現場資源，廣泛的規模和全球影響力使我們在分散的市場中脫穎而出，使我們成為頂級運營商的首選合作夥伴，其中許多是長期客戶。

Crawford is an organization with more than 80 years of history and our focus is on building long-term and sustained value for all stakeholders. We have faced a lot of different market dynamics since the company's founding and continue to strategically evolve the model to perform and thrive in all market environments.

Crawford 是一家擁有 80 多年歷史的組織，我們的重點是為所有利害關係人創造長期、持續的價值。自公司成立以來，我們面臨許多不同的市場動態，並繼續策略性地發展模型，以在所有市場環境中表現和蓬勃發展。

Extreme weather events are becoming more severe and more frequent globally, driving long-term growth in weather related claims revenue for Crawford. Despite relatively benign weather in the last nine months, our catastrophe-specific teams remain crucial in supporting carriers and policyholders when severe weather hits.

全球範圍內的極端天氣事件變得越來越嚴重和頻繁，推動了克勞福德與天氣相關的索賠收入的長期增長。儘管過去九個月的天氣相對溫和，但當惡劣天氣來襲時，我們的災難專案團隊在為承運人和投保人提供支援方面仍然至關重要。

While our weather related revenue can fluctuate, experts believe that claims associated with extreme weather are likely to increase for the foreseeable future, underscoring the importance of our dedicated catastrophe teams in the face of rising long-term demand.

雖然我們與天氣相關的收入可能會波動，但專家認為，在可預見的未來，與極端天氣相關的索賠可能會增加，這突顯了我們專門的災難團隊在面對不斷增長的長期需求時的重要性。

Second, Crawford is ideally suited to meet the demand of increased outsourcing of claims processing through our ability to provide capacity, expertise and scale for the efficient and cost effective management of outsourced claims.

其次，Crawford 非常適合滿足日益增長的索賠處理外包需求，因為我們有能力提供能力、專業知識和規模，以實現高效且具成本效益的外包索賠管理。

Third, we are gaining share in the fragmented US independent loss adjusting market and continue to build and strengthen our partnerships across all our verticals. Finally, our proprietary insurance technology saves our clients time and money and we continuously invest in developing, enhancing and deploying advanced technology solutions around the world.

第三，我們正在分散的美國獨立損失理算市場中獲得份額，並繼續建立和加強我們在所有垂直領域的合作夥伴關係。最後，我們專有的保險技術為客戶節省了時間和金錢，我們持續投資於在世界各地開發、增強和部署先進的技術解決方案。

Turning to our quarterly performance. We continue to demonstrate strength in our core business with growth in three of our four segments this quarter. However, our overall consolidated results were impacted by the benign weather trend we have seen over the last nine months.

轉向我們的季度業績。我們繼續展現核心業務的實力，本季四個細分市場中的三個實現成長。然而，我們的整體綜合績效受到過去九個月的良性天氣趨勢的影響。

Damage resulting from severe convective storm activity and catastrophic events was at an unusually high level in 2023 and many of these events did not repeat in the second quarter of 2024.

2023 年，強烈對流風暴活動和災難性事件造成的損失異常高，其中許多事件在 2024 年第二季度沒有重複。

As a result, second quarter revenue decreased to $314 million compared to $325 million in the second quarter of 2023. Our operating earnings of $22.1 million also came in just slightly below the second quarter of 2023. Importantly, our non-weather businesses performed well this quarter, underscoring the balance and resilience of Crawford's business platform.

因此，第二季營收從 2023 年第二季的 3.25 億美元下降至 3.14 億美元。我們的營業利潤為 2,210 萬美元，略低於 2023 年第二季。重要的是，我們的非天氣業務本季表現良好，凸顯了克勞福德業務平台的平衡性和彈性。

By growing and strengthening our operations, we are well positioned to meet our clients' diverse needs during all weather patterns. Broadspire achieved significant growth again this quarter, setting a new quarterly revenue and earnings record. Our GTS service line also had a record revenue this quarter and we saw solid growth in our international operations.

透過發展和加強我們的業務，我們能夠在各種天氣條件下滿足客戶的多樣化需求。Broadspire本季再次實現顯著成長，創下季度營收和獲利新紀錄。我們的 GTS 服務系列本季的營收也創歷史新高，我們的國際業務也實現了穩健成長。

Our efforts to improve efficiencies across our business are yielding results with operating earnings growth in three segments this quarter. And as a result of the hard work of our talented staff and proven success fostering client relationships, we added a total of $23 million in new and enhanced business this quarter.

我們提高整個業務效率的努力正在取得成果，本季三個部門的營業利潤均實現成長。由於我們才華橫溢的員工的辛勤工作以及在培養客戶關係方面取得的成功，本季度我們的新業務和增強業務總計增加了 2,300 萬美元。

As always, our conservative approach to capital management is reflected in the strength of our balance sheet. As we discussed last quarter, our weather related business faces a difficult comparison to elevated catastrophe activity in the first half of 2023.

一如既往，我們保守的資本管理方法反映在我們資產負債表的實力上。正如我們上季度討論的那樣，我們的天氣相關業務面臨著與 2023 年上半年增加的災難活動相比的困難。

As shown by the chart on the left, at Crawford, we achieved 6% growth in our non-weather business this quarter, which reflects the continued traction we are getting in our growth strategy that is diversifying our revenue mix.

如左圖所示，在 Crawford，本季我們的非天氣業務實現了 6% 的成長，這反映了我們在實現收入組合多元化的成長策略中獲得的持續牽引力。

Our weather related business, which includes US CAT, US Loss Adjusting and Australia decreased 21%. The middle chart shows our Network business. As a reminder, Networks serve our largest clients with their catastrophe specific claims handling needs.

我們的天氣相關業務（包括美國 CAT、美國損失調整和澳洲）下降了 21%。中間的圖表顯示了我們的網路業務。謹此提醒，網路為我們最大的客戶提供災難特定索賠處理需求。

Similar to the first quarter of this year, this segment saw a decrease in revenues from claims management services frequently tied to storm activity. Our Network service line saw a revenue decline of 65% this quarter directly related to reduced weather related claims.

與今年第一季類似，該細分市場經常與風暴活動相關的理賠管理服務收入下降。我們的網路服務系列本季收入下降了 65%，這與天氣相關索賠的減少直接相關。

Reduced losses associated with storm activity have been observed across the industry. Profiled on the chart on the right, Gallagher Re reported a 21% decrease in insured losses from US severe convective storms in the first half of 2024, consistent with the decrease we have seen in our weather-related business.

整個行業都觀察到與風暴活動相關的損失減少。如右圖所示，Gallagher Re 報告稱，2024 年上半年美國強對流風暴造成的保險損失下降了 21%，這與我們在天氣相關業務中看到的下降情況一致。

This may sound surprising, given the significant weather events in the news, including last month's Hurricane Beryl, one of the earliest storms in the US. However, insured damage from Beryl was lower than similar storms in prior years. Given the available capacity at carriers due to benign weather patterns seen over the last nine months, we expect minimum revenue impact from Beryl.

考慮到新聞中的重大天氣事件，包括上個月的美國最早的風暴之一貝裡爾颶風，這聽起來可能令人驚訝。然而，綠柱石造成的保險損失低於前幾年的類似風暴。鑑於過去九個月的良好天氣模式導致營運商的可用運力，我們預計 Beryl 對收入的影響最小。

To-date in 2024, carriers have largely managed claims in-house. However, our teams stand ready to provide crucial support assisting carriers in managing increased claims volumes and aiding in the rebuilding of severely affected communities when severe storm activity picks up. Our capital allocation strategy focuses on investing in innovation and technology to enhance claims handling and pursuing strategic acquisitions and partnerships to expand market share.

到 2024 年為止，承運人基本上都是在內部管理索賠。然而，我們的團隊隨時準備提供重要支持，幫助承運人管理不斷增加的索賠量，並在嚴重風暴活動加劇時幫助重建受嚴重影響的社區。我們的資本配置策略專注於投資創新和技術，以加強索賠處理，並尋求策略性收購和合作夥伴關係，以擴大市場份額。

We are disciplined in our approach to capital allocation and our balanced approach is centered on driving sustainable long-term growth and delivering enhanced value to shareholders. Our leverage ratio remains low at 2.09 times EBITDA, giving us significant financial flexibility and liquidity.

我們在資本配置方面遵守紀律，我們的平衡方法以推動可持續的長期成長和為股東提供更高的價值為中心。我們的槓桿率保持在 2.09 倍 EBITDA 的低水平，為我們提供了巨大的財務靈活性和流動性。

Additionally, we prioritize returning capital to shareholders via regular dividends, reflecting our strong balance sheet. We continued our quarterly dividend of $0.07 for CRD-A and CRD-B shares in the second quarter of 2024.

此外，我們優先考慮透過定期股息向股東返還資本，這反映了我們強勁的資產負債表。我們在 2024 年第二季繼續為 CRD-A 和 CRD-B 股票派發 0.07 美元的季度股利。

With that, let me turn the call over to Bruce for a deeper look at our operational and financial performance.

接下來，讓我將電話轉給布魯斯，以更深入地了解我們的營運和財務績效。

Thank you, Rohit. As most of you know, our business is diversified and is comprised of four segments. North America loss adjusting encompasses our loss adjusting business in the US and Canada and accounted for 24% of our second quarter 2024 revenues. Our International business is comprised of all reported service lines outside of North America and contributed 33% of revenues.

謝謝你，羅希特。眾所周知，我們的業務是多元化的，由四個部分組成。北美損失理算包括我們在美國和加拿大的損失理算業務，占我們 2024 年第二季營收的 24%。我們的國際業務由北美以外所有報告的服務線組成，佔收入的 33%。

Broadspire is our third-party administrator in the US and accounts for 31% of our revenues. In Platform Solutions, which includes Contractor Connection and our Networks and Subrogation businesses contributed 12%.

Broadspire 是我們在美國的第三方管理機構，占我們收入的 31%。在平台解決方案中，包括承包商連接以及我們的網路和代位業務貢獻了 12%。

Now let's review each of these segments. Beginning with North America loss adjusting, in the second quarter of 2024, our revenues were $76 million, consistent with the prior year quarter.

現在讓我們回顧一下每個部分。從北美虧損調整開始，2024 年第二季我們的營收為 7,600 萬美元，與去年同期一致。

Operating earnings were $4.9 million, an increase of 25% over the $3.9 million in the prior year quarter and our margin increased 132 basis points to 6.4% from 5.1% in the prior year quarter. Our margin expansion in the quarter was largely due to our ability to expand market share and grow our customer base in the GTS service line which had another record revenue quarter.

營業利潤為 490 萬美元，比去年同期的 390 萬美元成長 25%，利潤率從去年同期的 5.1% 增加 132 個基點至 6.4%。我們本季利潤率的成長主要歸功於我們擴大市場份額和擴大 GTS 服務線客戶群的能力，該服務線的收入再次創紀錄。

International Operations revenue for the 2024 second quarter was $102.3 million and operating earnings were $5.7 million. Our revenue grew 7% from $95.3 million in the second quarter of 2023 or 9% when measured in constant currency. Our operating earnings showed a significant increase of more than 50% over the prior year quarter reflecting improved performance in the UK and Europe.

2024 年第二季國際營運收入為 1.023 億美元，營業利潤為 570 萬美元。我們的營收比 2023 年第二季的 9,530 萬美元成長了 7%，以固定匯率計算成長了 9%。我們的營業收入比去年同期大幅成長 50% 以上，反映出英國和歐洲業績的改善。

We still have work to do in our International Operations to return to historical margin levels. But it is clear that our efforts to turn around this segment post-pandemic have positioned us for long-term success and growth in key markets.

我們的國際業務仍有許多工作要做，以恢復到歷史利潤水平。但很明顯，我們在疫情後扭轉這一細分市場的努力使我們能夠在關鍵市場取得長期成功和成長。

Broadspire showed continued strength in the quarter, setting a new quarterly revenue record of $97.1 million in the second quarter, an 11% increase from $87.2 million in the 2023 period.

Broadspire 在本季表現出持續強勁的勢頭，第二季度創下了 9,710 萬美元的新季度營收記錄，比 2023 年期間的 8,720 萬美元增長了 11%。

Operating earnings for the second quarter were also a record of $15.1 million compared to $8.1 million, reflecting operating margin expansion of 620 basis points to 15.5%. Medical Management Services and Claims Management both showed strong growth of 11% in the quarter.

第二季營業利潤也創紀錄地達到 1,510 萬美元，而去年同期為 810 萬美元，反映出營業利潤率擴大了 620 個基點，達到 15.5%。醫療管理服務和理賠管理本季均實現 11% 的強勁成長。

Client wins continue to be our strongest growth driver and our talented teams have been performing at a consistently high level in 2024. Additionally, we retained 95% of our business year-to-date, contributing to solid recurring revenues in the segment.

贏得客戶仍然是我們最強大的成長動力，我們才華橫溢的團隊在 2024 年一直保持著高水準的表現。此外，今年迄今為止，我們保留了 95% 的業務，為該領域帶來了穩定的經常性收入。

Platform Solutions second quarter revenues of $38.8 million decreased by approximately 41% compared with $65.6 million in the second quarter of 2023. Operating earnings in Platform Solutions totaled $1.5 million or 3.8% of segment revenues in the 2024 quarter compared to operating earnings of $8.1 million or 12.3% of revenues in the prior year quarter.

平台解決方案第二季營收為 3,880 萬美元，較 2023 年第二季的 6,560 萬美元下降約 41%。2024 年季度，平台解決方案的營運利潤總計 150 萬美元，佔部門收入的 3.8%，而去年同期的營運利潤為 810 萬美元，佔營收的 12.3%。

As Rohit mentioned earlier, the weakness in this segment is primarily attributed to softness in the Networks business related to reduced catastrophe activity, reflecting the notable reduction in insured losses from US severe convective storms year-over-year. We continue to keep our catastrophe response team well positioned for the potential of increased activity as we move through the hurricane season.

正如羅希特先前提到的，該部門的疲軟主要歸因於與巨災活動減少相關的網路業務疲軟，反映出美國強對流風暴造成的保險損失同比顯著減少。隨著颶風季節的到來，我們將繼續讓我們的災難應變團隊做好準備，以應對增加活動的潛力。

And now for a look at our consolidated financials. In the second quarter of 2024, company-wide revenues before reimbursements decreased 3.2% to $314.2 million. Foreign exchange rates decreased revenues before reimbursements by $1.9 million or less than 1%. GAAP net income attributable to shareholders totaled $8.6 million compared to net income of $8.4 million in the same period of 2023.

現在來看看我們的綜合財務狀況。2024 年第二季度，報銷前全公司營收下降 3.2%，至 3.142 億美元。外匯匯率使償付前收入減少了 190 萬美元，不到 1%。GAAP 股東應佔淨利總計 860 萬美元，而 2023 年同期淨利為 840 萬美元。

GAAP diluted EPS in the 2024 second quarter was $0.17 for both CRD-A and CRD-B consistent with $0.17 for both share classes in the 2023 period. On a non-GAAP basis, diluted EPS was $0.25 for both CRD-A and CRD-B compared to $0.24 for both share classes in the prior year period. Company's non-GAAP operating earnings totaled $22.1 million in the 2024 second quarter or 7% of revenues compared to $22.8 million or 7% of revenues in the prior year period.

2024 年第二季度，CRD-A 和 CRD-B 的 GAAP 稀釋每股盈餘均為 0.17 美元，與 2023 年期間這兩個股票類別的 0.17 美元一致。以非公認會計準則計算，CRD-A 和 CRD-B 的稀釋後每股盈餘均為 0.25 美元，而去年同期這兩種股票類別的稀釋後每股盈餘均為 0.24 美元。2024 年第二季度，公司的非 GAAP 營業利潤總計 2,210 萬美元，佔營收的 7%，而去年同期為 2,280 萬美元，佔營收的 7%。

Consolidated adjusted EBITDA was $30.6 million in the 2024 second quarter or 9.7% of revenues compared to $31.5 million or 9.7% of revenues in the 2023 quarter. The company's cash and cash equivalent position as of June 30, 2024, totaled $46.7 million compared to $58.4 million at the 2023 year-end. Our total receivables were up $17 million from the 2023 year-end primarily due to an increase in unbilled revenues that we expect to unwind through the remainder of the year.

2024 年第二季合併調整後 EBITDA 為 3,060 萬美元，佔營收的 9.7%，而 2023 年季為 3,150 萬美元，佔營收的 9.7%。截至 2024 年 6 月 30 日，該公司的現金和現金等價物部位總計 4,670 萬美元，而 2023 年底為 5,840 萬美元。我們的應收帳款總額比 2023 年底增加了 1,700 萬美元，主要是由於我們預計在今年剩餘時間內收回未開票收入的增加。

The company's total debt outstanding as of June 30, 2024, totaled $233.8 million up from $209.1 million as of December 31, 2023, which is not unusual for the front half of the year. Net debt stood at $187.1 million as of June 30, 2024, while our US pension liability was $23.2 million at the end of the second quarter, reflecting a funded ratio of 92.6%.

截至 2024 年 6 月 30 日，該公司的未償債務總額從截至 2023 年 12 月 31 日的 2.091 億美元增至 2.338 億美元，這在今年上半年並不罕見。截至 2024 年 6 月 30 日，淨負債為 1.871 億美元，而截至第二季末，我們的美國退休金負債為 2,320 萬美元，資金到位率為 92.6%。

We made no discretionary contributions to our US defined benefit pension plan during the second quarter of 2024 and we do not intend to make contributions for the remainder of the year.

2024 年第二季度，我們沒有向美國固定福利退休金計畫酌情繳款，我們也不打算在今年剩餘時間內繳款。

Cash used in operating activities for the 2024 year-to-date period was a use of $8.3 million with free cash flow of negative $26.7 million. This compares to cash flow from operations last year of $27.2 million and free cash flow of $9.2 million.

2024 年迄今，經營活動所用現金為 830 萬美元，自由現金流為負 2,670 萬美元。相比之下，去年的營運現金流為 2,720 萬美元，自由現金流為 920 萬美元。

This decrease in free cash flow was primarily due to lower operating earnings, higher incentive compensation payments compared to the prior year and other working capital increases.

自由現金流的減少主要是因為營業收入下降、激勵薪資較上年增加、其他營運資本增加。

With that, I'll turn the call back over to Rohit for concluding remarks.

之後，我會將電話轉回給羅希特進行總結發言。

Thank you, Bruce. To conclude, we saw some very encouraging earnings growth and margin expansion this quarter in three of our four segments. I am optimistic about our overall trajectory and momentum with our strong business foundation and proven growth strategy.

謝謝你，布魯斯。總而言之，本季我們四個細分市場中的三個細分市場出現了一些非常令人鼓舞的獲利成長和利潤率擴張。憑藉我們強大的業務基礎和行之有效的成長策略，我對我們的整體發展軌跡和勢頭感到樂觀。

Thank you for your time today. Julie, please open the call for questions.

感謝您今天抽出時間。朱莉，請打開提問電話。

(Operator Instructions)

（操作員說明）

Mark Hughes, Truist. Please go ahead.

馬克‧休斯，真理主義者。請繼續。

Yes. Thank you. Good morning.

是的。謝謝。早安.

Good Moring, Mark.

早安，馬克。

The Broadspire profitability is very good in the quarter. Anything unusual boosting that or is this a level that might be sustainable?

Broadspire本季的獲利能力非常好。有什麼不尋常的事情推動了這個水平，或者這個水平是否可以持續？

Hi, Mark. This is Rohit. As you know, we've been investing significantly in Broadspire and we've been developing a strategy, which has been focused on developing an unbundled technology and med management offering as well as focusing on the alternative insurance market. All those strategies are working and clicking well.

嗨，馬克。這是羅希特。如您所知，我們一直在 Broadspire 上進行了大量投資，並且一直在製定一項策略，該策略的重點是開發非捆綁技術和醫療管理產品以及另類保險市場。所有這些策略都在發揮作用並且效果良好。

We believe that the work that we have done is showing the results. We expect to continue making investments from a technology standpoint and be the leading technology-led provider in terms of Broadspire services. So we feel very good about where we are. We've also had a good run of new business there. I think you've heard that in a strong retention at over 95%.

我們相信，我們所做的工作正在展示成果。我們期望繼續從技術角度進行投資，並成為 Broadspire 服務領先的技術主導提供者。所以我們對自己所處的位置感覺非常好。我們在那裡也開展了良好的新業務。我想您已經聽說過，保留率高達 95% 以上。

So all those factors are contributing. And we expect to maintain those factors which should continue to add to the profitability or maintain the profitability I should say.

所以所有這些因素都在起作用。我應該說，我們期望維持那些應該繼續增加獲利能力或維持獲利能力的因素。

Yeah. On GTS you talked about the good growth there, I think, record revenue. Is that utilization or have you been adding staff there, driving the top line?

是的。在 GTS 上，您談到了那裡的良好成長，我認為，創紀錄的收入。是利用率還是您在那裡增加了員工，從而推動了營收成長？

Yes, so I think we were, as you know, we had shared this at least two years ago now, maybe close to three years ago that our strategy in GTS was to build an expertise-led model and continue to add to that expertise. We had made a commitment of adding 200 plus resources, which we were supposed to meet by the end of 2023, but we actually met that goal early part of 2023.

是的，所以我認為，正如您所知，我們至少在兩年前，也許接近三年前就已經分享過這一點，我們在GTS 中的策略是建立一個以專業知識為主導的模型，並繼續增加該專業知識。我們曾承諾增加 200 多個資源，本應在 2023 年底前實現，但實際上我們在 2023 年初就實現了這一目標。

And since then we have had an opportunity to continue to add additional expertise and resources to that and gain more nominated accounts over the period. So all that has contributed to the growth. And again we're not stopping. We'll opportunistically continue to add experts when we find them and where we find them.

從那時起，我們就有機會繼續為此增加額外的專業知識和資源，並在此期間獲得更多的提名帳戶。所有這些都促進了增長。我們再一次不會停止。當我們找到專家以及在哪裡找到他們時，我們將繼續機會主義地添加專家。

In the International business, you had some nice recovery in margin. Have you taken the steps that you're able to take and perhaps the margin is more dependent on top line from here or are there more internal actions you can take to help improve profitability?

在國際業務中，你的利潤率有了一些不錯的恢復。您是否已採取了您能夠採取的步驟，也許利潤更多地取決於這裡的營收，或者您可以採取更多內部行動來幫助提高盈利能力？

Look, we are very pleased with the recovery that we've seen in International as well. We do believe that this is a multiyear journey, as we've shared before, and we are partly into that journey. We expect to continue to make some more changes in the coming quarters. So we should see the profitability continue to move. Is it where we want it to be? No, not yet. But we are on a journey to bring it back to pre-COVID levels and we believe that we'll get there.

看，我們對國際賽上的復甦也感到非常高興。正如我們之前所分享的那樣，我們確實相信這是一個多年的旅程，並且我們部分參與了這一旅程。我們預計在未來幾季將繼續做出更多改變。因此，我們應該會看到獲利能力繼續上升。這是我們想要的地方嗎？不，還沒有。但我們正在努力將其恢復到新冠疫情之前的水平，我們相信我們會實現這一目標。

And then one more, if I might. In the weather-related lines where you've seen some pressure lately, is your cost structure, fixed variable, is that where you want it to be under the circumstances and there's obviously some infrastructure you're just going to have to keep and some costs you bear in that business or are there likewise additional steps you can take there to help even out some of the drier periods?

如果可以的話，然後再來一張。在與天氣相關的行業中，您最近看到了一些壓力，是您的成本結構，固定變量，是您在這種情況下希望它處於的位置，並且顯然您必須保留一些基礎設施和一些您在該業務中承擔的成本，或者您可以採取相同的額外措施來幫助度過一些乾旱期？

It's a very good question, Mark. There are elements of that cost structure, which are variable, and we have flexed those variables that to make sure that we account for the benign weather. We do have certain parts that we are still maintaining and we're maintaining at a relatively higher level than what we could only because we want to stay differentiated in the marketplace and stand ready.

這是一個非常好的問題，馬克。這個成本結構中有一些因素是可變的，我們已經調整了這些變量，以確保我們考慮到良性天氣。我們確實有某些部分仍在維護，我們維持在比我們所能達到的相對更高的水平，只是因為我們希望在市場中保持差異化並做好準備。

All the experts have talked about this being one of the most active weather seasons we've seen and early hurricane and we've seen a second one come through. There's another system developing on the back. We just don't want to be caught flat-footed to serve our clients.

所有專家都談到，這是我們所見過的最活躍的天氣季節之一，也是早期颶風的季節之一，而且我們已經看到了第二個颶風的到來。背面還有另一個系統正在開發中。我們只是不想在為客戶提供服務時措手不及。

Thank you very much.

非常感謝。

Thank you.

謝謝。

(Operator Instructions)

（操作員說明）

Kevin Steinke, Barrington Research.

凱文‧史坦克，巴靈頓研究中心。

Good morning. Thank you.

早安.謝謝。

Good morning, Kevin

早安，凱文

Hi Kevin

嗨凱文

Hello. I think you may have touched on this a bit, Bruce, but you had flat revenues in North America loss adjusting, but still a pickup in operating earnings year-over-year. Could you speak to that a little bit more? Any factors that might help drive that?

你好。布魯斯，我想你可能已經談到了這一點，但你在北美虧損調整後的收入持平，但營業利潤仍然同比上升。能再談一下嗎？有什麼因素可能有助於推動這一趨勢？

Yes. I think we've seen good growth in the GTS business and that's attracted good margins. The North America loss adjusting business is comprised of GTS and we also have what we call US field operations. And they were able to manage their cost well in light of some volatility with weather-related claim referrals as well. So an improvement in profitability, but there operating margin for the quarter at 6.5%, it's pretty good considering the weather, but not where we want it to be ultimately, so still a little work to do there.

是的。我認為我們已經看到 GTS 業務的良好成長，並帶來了豐厚的利潤。北美損失理算業務由 GTS 組成，我們還有所謂的美國現場業務。鑑於天氣相關索賠轉介的一些波動，他們也能夠很好地管理成本。因此，獲利能力有所改善，但本季的營業利潤率為 6.5%，考慮到天氣因素，這已經相當不錯了，但不是我們最終希望的結果，因此仍有一些工作要做。

Okay. Any specific work you need to do there or is it just a matter of the kind of the weather-related impact?

好的。您需要在那裡做哪些具體工作，或者這只是與天氣相關的影響類型的問題？

I think it's weather related primarily. As we bring on new GTS adjusters, as Rohit was mentioning earlier, there is a little bit of a ramp period there before they're kind of reached their peak profitability. But no I don't think there's anything really structurally we need to do in the North America loss adjusting business.

我認為這主要與天氣有關。正如羅希特之前提到的那樣，當我們引入新的 GTS 調節器時，在它們達到盈利能力高峰之前會有一段過渡期。但不，我認為我們在北美損失調整業務中實際上不需要做任何結構性的事情。

Okay. Thanks. And as I look at the trend in Networks revenue for the third quarter over the last three years, third quarter 2023, it looked like a solid quarter, but it was the lowest revenue quarter of the last three years, '21 through '23.

好的。謝謝。當我觀察過去三年第三季度（2023 年第三季）網路收入的趨勢時，它看起來是一個穩定的季度，但這是過去三年（21 年至 23 年）收入最低的季度。

I suppose it's hard to judge now, but it looks like the comp is easing a little bit, but I suppose it's also just going to be obviously highly dependent on what sort of weather activity we have here. But just kind of any thoughts on, did we have unusually strong weather events last year to contributing to the third quarter or is that kind of maybe a little bit more normalized?

我想現在很難判斷，但看起來競爭正在緩和一點，但我想這顯然也將高度依賴我們這裡的天氣活動。但有什麼想法，去年我們是否有異常強烈的天氣事件對第三季度做出了貢獻，或者這種情況可能更加正常化了？

Kevin, we definitely had higher levels of activity, particularly in Q2 of last year. What that did was it filled up the available capacity at the carriers as a result of that which more claims in Q3 that were coming into the carriers ended up getting outsourced. So that's what led to that.

凱文，我們的活動水平肯定更高，尤其是去年第二季。這樣做的結果是，它填滿了承運商的可用容量，因為第三季更多進入承運商的索賠最終被外包。這就是導致這種情況的原因。

We have the same set of clients still. We continue to maintain a very strong NPS with them. So we believe that if the weather activity holds then we should start to see similar kind of work come our way. With the two hurricanes Debby as well as Beryl, we believe that while the claim activity has been low, it has given enough work to the carriers to be at capacity.

我們仍然擁有同樣的客戶群。我們繼續與他們保持非常強大的淨推薦值。因此，我們相信，如果天氣活動持續下去，那麼我們應該會開始看到類似的工作出現。在黛比和貝裡爾這兩場颶風的影響下，我們相信，雖然索賠活動較低，但它已經為承運人提供了足夠的工作量，使其能夠滿載運轉。

So if we see another weather event come through, that should push more work towards us. But as history has taught me being in the insurance industry for a long time that never try to predict the weather until it's already happened.

因此，如果我們看到另一場天氣事件發生，這應該會為我們帶來更多的工作。但歷史告訴我，在保險業工作了很長一段時間，在天氣發生之前從來不會嘗試預測天氣。

Right. Makes sense. That's fair enough. Yes. So you spoke to the momentum you have in Broadspire and it sounds like you expect that to continue. Maybe again can you just expand on what's driving the new client wins and the sustainability of the momentum there and your what you feel might be helping drive those wins in terms of maybe competitive differentiation?

正確的。有道理。這很公平。是的。所以你談到了 Broadspire 的勢頭，聽起來你希望這種勢頭能夠持續下去。也許您可以再次擴展推動新客戶獲勝的因素以及那裡勢頭的可持續性，以及您認為可能有助於在競爭差異化方面推動這些勝利的因素？

Certainly. Look, there are three factors, I believe, that are driving the success in Broadspire, first and foremost, being the technology investment that we've made, which is really differentiating us in the marketplace. The second, a very focused strategy on not only growing the traditional business, but also focused on the alternative insurance market, which focuses on MGAs and carriers and captives and program business, that has gotten quite a lot of traction.

當然。看，我相信，有三個因素推動了 Broadspire 的成功，首先也是最重要的是我們所做的技術投資，這確實使我們在市場上脫穎而出。第二個是非常專注的策略，不僅致力於發展傳統業務，而且還專注於另類保險市場，該市場專注於 MGA、承運人、自保和計劃業務，這一市場已經獲得了相當大的關注。

And then the third and final thing is the investments that we've made in training and development. We've been onboarding a new class of adjusters every year for the last three years or so. That has really helped us maintain our staffing levels much better than what we hear in the marketplace from some of our competitors.

第三件事也是最後一件事是我們在培訓和發展方面的投資。在過去三年左右的時間裡，我們每年都會招募一批新的理賠員。這確實幫助我們保持了我們的員工水平，比我們在市場上從一些競爭對手那裡聽到的要好得多。

And as a result of which, we can provide a lot more stability in terms of level of service to our clients. Those are the three biggest factors that I would say have led us to the growth. And again we're not relenting on any of those three. So we believe that, that should help us continue the momentum.

因此，我們可以為客戶提供更穩定的服務水準。我認為這些是導致我們成長的三個最大因素。再說一遍，我們不會對這三者中的任何一個心慈手軟。所以我們相信，這應該有助於我們繼續保持這一勢頭。

Okay. Great. You referred to the staffing levels there. It sounds like that's something you're going to continue to invest in Broadspire, I suppose, given the growth momentum there, but maybe speak to your ability to add staff and your attractiveness as a destination there maybe relative to -- you mentioned maybe others not staffing up as much, but any comment there on just the labor trends in that business?

好的。偉大的。您提到了那裡的人員配置等級。我想，考慮到那裡的成長勢頭，這聽起來是你將繼續投資於Broadspire 的東西，但也許可以談談你增加員工的能力以及你作為目的地的吸引力，這可能與你提到的其他人有關沒有那麼多的人員配備，但對該行業的勞動力趨勢有什麼評論嗎？

Yes. As you know, that is a market that continue, I mean, claims in general is a market which continues to age. What we've been investing in Broadspire is to bring in what we call very early tenure adjusters people that may have had some experience in an allied kind of line or allied kind of industry, however, not directly in claims to bringing them in and training them from the ground up.

是的。如您所知，這是一個持續存在的市場，我的意思是，總體而言，索賠是一個持續老化的市場。我們對 Broadspire 的投資是引進我們所說的非常早期的任期調整者，他們可能在相關行業或相關行業有過一些經驗，但並不是直接聲稱要引進他們並進行培訓。

I think what makes us attractive is the kind of benefits that we offer, the kind of culture environment that we provide, the career opportunities and the growth potential. Our vision statement is to be a place where experts want to be. And we believe that that's resonating in the marketplace and our actions are demonstrating that we are living to that vision. And those are the reasons we believe that we're able to attract workforce.

我認為我們的吸引力在於我們提供的福利、文化環境、職業機會和成長潛力。我們的願景是成為專家想要的地方。我們相信這會在市場中引起共鳴，我們的行動也顯示我們正在實現這個願景。這些就是我們相信我們能夠吸引勞動力的原因。

Okay. Great. And then just lastly, on the Medical Management side and Broadspire, it feels like that business has been fully recovered from the effects of the pandemic, but maybe any trends you're seeing there in terms of number of cases flowing or are you starting to see kind of maybe cases that have been delayed or coming back? Any sort of backlog or trends there in Medical Management?

好的。偉大的。最後，在醫療管理方面和 Broadspire 方面，感覺該業務已經從大流行的影響中完全恢復，但也許您在病例數量方面看到了任何趨勢，或者您是否開始看看有哪些案件被推遲或回來了？醫療管理方面有什麼積壓或趨勢嗎？

Yes. I would say that since the second quarter of 2023, we've been seeing a recovery back to the pre-pandemic levels. And I would say that right now, we're trending to be a little bit above the pre-pandemic levels. It's not always easy to make that comparison, but some of that is just related to growth in our underlying business as well.

是的。我想說，自 2023 年第二季以來，我們一直看到經濟恢復到疫情前的水平。我想說的是，現在我們的趨勢是略高於大流行前的水平。進行這種比較並不總是那麼容易，但其中一些也與我們基礎業務的成長有關。

So when we look at our case load on the Medical Management side, we believe that we've had a full recovery on the work that we had pre-pandemic. But then the additional cases that or additional clients that we've added are now having cases that are in line with what we would expect them to have based on the claims load that we see there. So we believe that we're fully recovered and moving well on that path.

因此，當我們查看醫療管理方面的病例量時，我們相信我們已經完全恢復了疫情前的工作。但是，我們添加的其他案例或其他客戶現在的案例與我們根據我們在那裡看到的索賠負載所期望的情況一致。所以我們相信我們已經完全康復並且在這條道路上進展順利。

Okay, great. That's helpful. Thank you for taking the questions. I will turn it back over.

好的，太好了。這很有幫助。感謝您提出問題。我會把它翻過來。

Thank you, Kevin. Always a pleasure

謝謝你，凱文。總是一種樂趣

And there are no further questions at this time. I will turn the call back over to Mr. Verma for closing remarks.

目前沒有其他問題。我將把電話轉回給維爾馬先生做總結發言。

Thank you so much, Julie, and thank you to all our employees, clients and shareholders for your continued commitment to Crawford & Company. Thank you very much for your time today. God bless.

非常感謝您，朱莉，並感謝我們所有的員工、客戶和股東對克勞福德公司的持續承諾。非常感謝您今天抽出時間。上帝保佑。

Thank you for participating in today's Crawford & Company Conference Call. This call will be available for replay beginning at 11:30 AM Eastern Time today through 11:59 PM Eastern Time on September 5, 2024. The conference ID number for the replay is 332233. The number to dial for the replay is 877-674-7070. Thank you. You may now disconnect.

感謝您參加今天的克勞福德公司電話會議。本次電話會議將於東部時間今日上午 11:30 至東部時間 2024 年 9 月 5 日晚上 11:59 進行重播。重播的會議 ID 號碼為 332233。重播的號碼是 877-674-7070。謝謝。您現在可以斷開連線。