Acquisition boosts Crawford's revenue; special charges clip net incomeReprints
Crawford & Co.'s revenue totaled $324.4 million in the second quarter of 2015, up about 6% from the same period in 2014, as its acquisition of GAB Robins Holdings U.K. Ltd. added nearly $22 million to its Europe, Middle East and Africa/Asia Pacific segment revenue.
However, the Atlanta-based claims management provider's second-quarter net income dropped 61% to $4.1 million compared with the same period last year because of the continued lack of severe weather claims in the property and casualty sector.
The company also incurred special charges of $4.2 million in the second quarter due to the ongoing implementation of its Global Business Services Center in Manila, Philippines, integration costs for the GAB Robins acquisition, and restructuring activities in the EMEA/AP and Americas segments.
Despite the overall revenue boost provided by the GAB Robins acquisition, revenue in the EMEA/AP segment were negatively affected about 13% due to changes in foreign exchange rates, the company said Monday in a statement.
Revenues for Crawford's Broadspire Services Inc. segment rose 10% to $73.7 million in the second quarter due to organic growth, new clients, higher client retention, the transfer of accident and health cases from its U.S. claims service line in the Americas segment and increased medical management services referrals, according to the company.
For the first half of the year, Crawford's total revenue rose 6% to $631 million. Year-to-date net income was $7.5 million, down 57% compared with the first six months of 2014.
Crawford said it expects to incur an estimated $7 million in pretax special charges this year for the integration of GAB Robins and $9 million related to the establishment of the Manila center. The company also expects to incur an additional special charge projected at $4 million related to restructuring activities in the EMEA/AP and Americas segments.
Crawford acquired 100% of GAB Robins in a $73.3 million deal last December. U.K. regulators cleared the deal in March.