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Segment Information
 9 Months Ended
Sep. 30, 2020
Segment Reporting [Abstract]  
Segment Information

10. Segment Information

Financial information for the three and nine months ended September 30, 2020 and 2019 related to the Company's reportable segments, including a reconciliation from segment operating earnings to income before income taxes, the most directly comparable GAAP financial measure, is presented below:

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

(in thousands)

 

September 30,

2020

 

 

September 30,

2019

 

 

September 30,

2020

 

 

September 30,

2019

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Crawford Claims Solutions

 

$

98,369

 

 

$

86,250

 

 

$

257,407

 

 

$

255,572

 

Crawford TPA Solutions

 

 

87,210

 

 

 

99,495

 

 

 

270,870

 

 

 

296,807

 

Crawford Specialty Solutions

 

 

67,545

 

 

 

68,932

 

 

 

196,794

 

 

 

206,237

 

Total segment revenues before reimbursements

 

 

253,124

 

 

 

254,677

 

 

 

725,071

 

 

 

758,616

 

Reimbursements

 

 

8,545

 

 

 

11,165

 

 

 

25,519

 

 

 

31,449

 

Total revenues

 

$

261,669

 

 

$

265,842

 

 

$

750,590

 

 

$

790,065

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Operating Earnings

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Crawford Claims Solutions

 

$

7,219

 

 

$

2,661

 

 

$

6,329

 

 

$

4,058

 

Crawford TPA Solutions

 

 

4,414

 

 

 

9,347

 

 

 

13,870

 

 

 

21,106

 

Crawford Specialty Solutions

 

 

17,390

 

 

 

13,301

 

 

 

38,340

 

 

 

38,108

 

Total segment operating earnings

 

 

29,023

 

 

 

25,309

 

 

 

58,539

 

 

 

63,272

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Deduct)/Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unallocated corporate and shared costs, net

 

 

(968

)

 

 

(1,649

)

 

 

(5,227

)

 

 

(2,393

)

Net corporate interest expense

 

 

(1,599

)

 

 

(3,162

)

 

 

(6,275

)

 

 

(8,346

)

Stock option expense

 

 

(457

)

 

 

(450

)

 

 

(1,033

)

 

 

(1,348

)

Amortization of customer-relationship intangible assets

 

 

(3,665

)

 

 

(2,829

)

 

 

(9,153

)

 

 

(8,429

)

Goodwill impairment

 

 

—

 

 

 

—

 

 

 

(17,674

)

 

 

—

 

Restructuring costs

 

 

—

 

 

 

—

 

 

 

(5,714

)

 

 

—

 

Arbitration and claim settlements

 

 

—

 

 

 

(1,200

)

 

 

—

 

 

 

(12,552

)

Gain on disposition of businesses, net

 

 

14,104

 

 

 

—

 

 

 

13,763

 

 

 

—

 

Income before income taxes

 

$

36,438

 

 

$

16,019

 

 

$

27,226

 

 

$

30,204

 

 

Operating earnings is the primary financial performance measure used by the Company's senior management and chief operating decision maker ("CODM") to evaluate the financial performance of the Company's three operating segments and make resource allocation and certain compensation decisions. The Company believes this measure is useful to investors in that it allows them to evaluate segment operating performance using the same criteria used by the Company's senior management and CODM. Operating earnings will differ from net income computed in accordance with GAAP since operating earnings represent segment earnings before certain unallocated corporate and shared costs and credits, net corporate interest expense, stock option expense, amortization of customer-relationship intangible assets, goodwill impairment, restructuring costs, gain on disposition of business, arbitration and claim settlements, income taxes, and net income or loss attributable to noncontrolling interests and redeemable noncontrolling interests.

Segment operating earnings includes allocations of certain corporate and shared costs. If the Company changes its allocation methods or changes the types of costs that are allocated to its three operating segments, prior period amounts presented in the current period financial statements are adjusted to conform to the current allocation process.

Intersegment transactions are not material for any period presented.

Revenues before reimbursements by major service line in the Crawford TPA Solutions segment, which operates under the Broadspire brand globally, and the Crawford Specialty Solutions segment are shown in the following table. The Company considers all Crawford Claims Solutions revenues to be derived from one service line.

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

(in thousands)

 

September 30,

2020

 

 

September 30,

2019

 

 

September 30,

2020

 

 

September 30,

2019

 

Crawford TPA Solutions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Claims Management Services

 

$

51,617

 

 

$

56,471

 

 

$

158,633

 

 

$

169,116

 

Medical Management Services

 

 

35,593

 

 

 

43,024

 

 

 

112,237

 

 

 

127,691

 

Total Revenues before Reimbursements--Crawford TPA Solutions

 

$

87,210

 

 

$

99,495

 

 

$

270,870

 

 

$

296,807

 

Crawford Specialty Solutions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Global Technical Services

 

$

44,002

 

 

$

45,990

 

 

$

133,380

 

 

$

135,628

 

Contractor Connection

 

 

23,543

 

 

 

22,942

 

 

 

63,414

 

 

 

70,609

 

Total Revenues before Reimbursements--Crawford Specialty Solutions

 

$

67,545

 

 

$

68,932

 

 

$

196,794

 

 

$

206,237