Form 10-Q Crawford & Company
Quarter Ended September 30, 1996 Page 2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Financial Statements:
Year-to-Date Unaudited Consolidated Statements of Income for the Nine-Month
Periods ended September 30, 1996 and September 30, 1995:
(In Thousand of Dollars
Except Share and Per Share Data)
1996 1995
Revenues $474,089 $450,466
Costs and Expenses:
Cost of services provided, less reimbursed expenses
of $24,333 in 1996 and $25,698 in 1995 340,871 327,135
Selling, general and administrative expenses 80,407 80,615
Total costs and expenses 421,278 407,750
Income Before Income Taxes 52,811 42,716
Provision for Income Taxes 21,297 17,228
Net Income $31,514 $25,488
Earnings Per Share $0.92 $0.73
Weighted Average Shares Outstanding 34,144,097 34,855,628
Declared Dividends Per Share - Class A Common Stock $0.450 $0.435
Declared Dividends Per Share - Class B Common Stock $0.435 $0.405
(See accompanying notes to condensed financial statements)
Form 10-Q Crawford & Company
Quarter Ended September 30, 1996 Page 3
Quarterly Unaudited Consolidated Statements of Income for the Three-Month
Periods ended September 30, 1996 and September 30, 1995:
(In Thousand of Dollars
Except Share and Per Share Data)
1996 1995
Revenues $154,897 $150,954
Costs and Expenses:
Cost of services provided, less reimbursed expenses
of $8,466 in 1996 and $8,625 in 1995 110,875 110,608
Selling, general and administrative expenses 25,833 24,540
Total costs and expenses 136,708 135,148
Income Before Income Taxes 18,189 15,806
Provision for Income Taxes 7,334 6,375
Net Income $10,855 $9,431
Earnings Per Share $0.32 $0.27
Weighted Average Shares Outstanding 34,022,615 34,878,976
Declared Dividends Per Share - Class A Common Stock $0.150 $0.145
Declared Dividends Per Share - Class B Common Stock $0.145 $0.135
(See accompanying notes to condensed financial statements)
Form 10-Q Crawford & Company
Quarter Ended September 30, 1996 Page 4
Consolidated Balance Sheets as of September 30, 1996 and December 31, 1995:
(In Thousands of Dollars)
(Unaudited)
September 30 December 31
1996 1995
ASSETS
Current Assets:
Cash and cash equivalents $53,312 $40,802
Short-term investments, at fair value 126 5,596
Accounts receivable, less allowance for doubtful
accounts of $10,978 in 1996 and $10,303 in 1995 109,387 111,636
Unbilled revenues, at estimated billable amounts 67,611 60,486
Prepaid income taxes 9,499 6,115
Prepaid expenses and other current assets 9,363 9,745
Total current assets 249,298 234,380
Property and Equipment:
Property and equipment, at cost: 123,207 121,307
Less accumulated depreciation and amortization (90,768) (84,859)
Net property and equipment 32,439 36,448
Other Assets:
Intangible assets arising from acquisitions, less
accumulated amortization of $8,976 in 1996
and $7,596 in 1995 53,989 55,731
Prepaid pension obligation 42,712 34,243
Other 7,100 6,181
Total other assets 103,801 96,155
TOTAL ASSETS $385,538 $366,983
(See accompanying notes to condensed financial statements)
Form 10-Q Crawford & Company
Quarter Ended September 30, 1996 Page 5
Consolidated Balance Sheets - (Continued)
(In Thousands of Dollars)
(Unaudited)
September 30 December 31
1996 1995
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities:
Short-term borrowings $8,547 $10,154
Accounts payable 11,044 12,366
Accrued compensation and related costs 36,168 26,764
Other accrued liabilities 34,841 29,394
Deferred revenues 16,364 15,504
Current installments of long-term debt 849 872
Total current liabilities 107,813 95,054
Noncurrent Liabilities:
Long-term debt, less current installments 9,431 9,412
Deferred income taxes 14,305 14,854
Deferred revenues 12,261 10,498
Postretirement medical benefit obligation 8,425 7,938
Self-insured risks 9,037 7,347
Other 2,231 1,020
Total noncurrent liabilities 55,690 51,069
Shareholders' Investment:
Class A Common Stock, $1.00 par value; 50,000,000
shares authorized; 16,593,623 and 17,229,986
shares issued in 1996 and 1995, respectively 16,594 17,230
Class B Common Stock, $1.00 par value; 50,000,000
shares authorized; 17,171,174 and 17,297,730
shares issued in 1996 and 1995, respectively 17,171 17,298
Retained earnings 191,574 189,294
Cumulative translation adjustment (3,304) (2,962)
Total shareholders' investment 222,035 220,860
TOTAL LIABILITIES AND SHAREHOLDERS' INVESTMENT $385,538 $366,983
(See accompanying notes to condensed financial statements)
Form 10-Q Crawford & Company
Quarter Ended September 30, 1996 Page 6
Unaudited Consolidated Statements of Cash Flows for the Nine-Month Periods Ended
September 30, 1996 and September 30, 1995:
(In Thousands of Dollars)
1996 1995
Cash Flows From Operating Activities:
Net income $31,514 $25,488
Reconciliation of net income to net cash
provided by operating activities:
Depreciation and amortization 11,933 12,685
Deferred income taxes 1,336 6,359
Loss on sales of property and equipment 324 691
Changes in operating assets and liabilities:
Short-term investments 5,470 12,205
Accounts receivable, net 1,836 (5,447)
Unbilled revenues (6,959) (511)
Prepaid or accrued income taxes (1,511) (3,247)
Accounts payable and accrued liabilities 13,992 (5,963)
Deferred revenues 2,624 1,809
Prepaid expenses and other assets (10,944) (16,154)
Net cash provided by operating activities 49,615 27,915
Cash Flows From Investing Activities:
Acquisitions of property and equipment (6,137) (10,833)
Net assets of companies acquired 0 (4,206)
Sales of property and equipment 301 123
Net cash used in investing activities (5,836) (14,916)
Cash Flows From Financing Activities:
Dividends paid (15,119) (14,658)
Repurchase of common stock (15,940) (3,721)
Issuance of common stock 1,063 910
Decrease in short-term borrowings (1,357) (265)
Increase in long-term debt 126 274
Net cash used in financing activities (31,227) (17,460)
Effect of exchange rate changes on cash and cash
equivalents (42) 230
Increase (Decrease) in cash and cash equivalents 12,510 (4,231)
Cash and cash equivalents at beginning of period 40,802 38,968
Cash and cash equivalents at end of period $53,312 $34,737
Cash payments for income taxes $21,461 $13,946
(See accompanying notes to condensed financial statements)