Net Income (Loss) Attributable to Shareholders of Crawford & Company per Common Share

3 Months Ended

Mar. 31, 2021

Net Income (Loss) Attributable to Shareholders of Crawford & Company per Common Share

7. Net Income (Loss) Attributable to Shareholders of Crawford & Company per Common Share

The Company computes earnings per share of its non-voting Class A Common Stock ("CRD-A") and voting Class B Common Stock ("CRD-B") using the two-class method, which allocates the undistributed earnings in each period to each class on a proportionate basis. The Company's Board of Directors has the right, but not the obligation, to declare higher dividends on the CRD-A shares than on the CRD-B shares, subject to certain limitations. In periods when the dividend is the same for CRD-A and CRD-B or when no dividends are declared or paid to either class, the two-class method generally will yield the same earnings per share for CRD-A and CRD-B. During the first quarter of 2021, the Board of Directors declared the same dividend on CRD-A and CRD-B, while during the first quarter of 2020, the Board of Directors declared a higher dividend on CRD-A than on CRD-B.

The computations of basic net income attributable to shareholders of Crawford & Company per common share were as follows:

	Three Months Ended
	March 31, 2021				March 31, 2020
(in thousands, except per share amounts)	CRD-A		CRD-B		CRD-A			CRD-B
Earnings (Loss) per share - basic:
Numerator:
Allocation of undistributed earnings (loss)	$	1,658	$	1,208	$	(8,436	)	$	(6,232	)
Dividends paid		1,851		1,347		2,140			1,129
Net income (loss) attributable to common shareholders, basic	$	3,509	$	2,555	$	(6,296	)	$	(5,103	)

Denominator:
Weighted-average common shares outstanding, basic		30,824		22,464		30,562			22,578
Earnings (loss) per share - basic	$	0.11	$	0.11	$	(0.21	)	$	(0.23	)

The computations of diluted net income (loss) attributable to shareholders of Crawford & Company per common share were as follows:

	Three Months Ended
	March 31, 2021				March 31, 2020
(in thousands, except per share amounts)	CRD-A		CRD-B		CRD-A			CRD-B
Earnings (Loss) per share - diluted:
Numerator:
Allocation of undistributed earnings (loss)	$	1,664	$	1,202	$	(8,436	)	$	(6,232	)
Dividends paid		1,851		1,347		2,140			1,129
Net income (loss) attributable to common shareholders, diluted	$	3,515	$	2,549	$	(6,296	)	$	(5,103	)

Denominator:
Weighted-average common shares outstanding, basic		30,824		22,464		30,562			22,578
Weighted-average effect of dilutive securities		282		—		—			—
Weighted-average common shares outstanding, diluted		31,106		22,464		30,562			22,578
Earnings (loss) per share - diluted	$	0.11	$	0.11	$	(0.21	)	$	(0.23	)

Listed below are the shares excluded from the denominator in the preceding computation of diluted earnings per share for CRD-A because their inclusion would have been antidilutive:

	Three Months Ended
(in thousands)	March 31, 2021		March 31, 2020
Shares underlying stock options excluded		972		1,904
Performance stock grants excluded because performance conditions have not been met ⁽¹⁾		929		932

⁽¹⁾	Compensation cost is recognized for these performance stock grants based on expected achievement rates; however, no consideration is given to these performance stock grants when calculating diluted earnings per share until the performance measurements have been achieved.

The following table details shares issued during the three months ended March 31, 2021 and 2020. These shares are included from their dates of issuance in the weighted-average common shares used to compute basic and diluted earnings per share for CRD-A in the table above. There were no shares of CRD-B issued during any of these periods.

	Three Months Ended
(in thousands)	March 31, 2021		March 31, 2020
CRD-A issued under the Non-Employee Director Stock Plan		92		81
CRD-A issued under the U.K. ShareSave Scheme		1		1

Effective May 9, 2019, the Company's Board of Directors authorized the repurchase of up to 2,000,000 shares of CRD-A or CRD-B (or a combination of the two) through December 31, 2021 (the "2019 Repurchase Authorization"). The Company’s Board of Directors subsequently amended this authorization to allow for repurchases through December 31, 2021. Under the 2019 Repurchase Authorization, repurchases may be made for cash, in the open market or privately negotiated transactions at such times and for such prices as management deems appropriate, subject to applicable contractual and regulatory restrictions. At March 31, 2021, the Company had remaining authorization to repurchase 493,198 shares under the 2019 Repurchase Authorization.

During the three months ended March 31, 2021, the Company repurchased 90,062 shares of CRD-A and 58,837 shares CRD-B at an average cost of $8.05 and $7.90, respectively. During the three months ended March 31, 2020, the Company repurchased 155,351 shares of CRD-A and 161,459 shares of CRD-B at an average cost of $8.42 and $8.42, respectively.