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

3 Months Ended

Mar. 31, 2024

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

7. Net Income 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 2024 and 2023, the Board of Directors has declared the same dividend on CRD-A and 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, 2024		March 31, 2023
(in thousands, except per share amounts)	CRD-A	CRD-B	CRD-A	CRD-B
Earnings per share - basic:
Numerator:
Allocation of undistributed earnings	$(365)	$(241)	$4,595	$3,161
Dividends paid	2,074	1,369	1,734	1,191
Net income attributable to common shareholders, basic	$1,709	$1,128	$6,329	$4,352

Denominator:
Weighted-average common shares outstanding, basic	29,586	19,542	28,841	19,848
Earnings per share - basic	$0.06	$0.06	$0.22	$0.22

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


	Three Months Ended
	March 31, 2024						March 31, 2023
(in thousands, except per share amounts)	CRD-A			CRD-B			CRD-A		CRD-B
Earnings per share - diluted:
Numerator:
Allocation of undistributed earnings	$	(368	)	$	(238	)	$	4,614	$	3,142
Dividends paid		2,074			1,369			1,734		1,191
Net income attributable to common shareholders, diluted	$	1,706		$	1,131		$	6,348	$	4,333

Denominator:
Weighted-average common shares outstanding, basic		29,586			19,542			28,841		19,848
Weighted-average effect of dilutive securities		693			—			300	—
Weighted-average common shares outstanding, diluted		30,279			19,542			29,141		19,848
Earnings per share - diluted	$	0.06		$	0.06		$	0.22	$	0.22

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, 2024	March 31, 2023
Shares underlying stock options excluded	—	1,532
Performance stock grants excluded because performance conditions have not been met (1)	1,100	758

(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, 2024 and 2023, including restricted shares that were returned prior to vesting. 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, 2024		March 31, 2023
CRD-A issued under the Non-Employee Director Stock Plan		71		134
CRD-A issued under the Employee Stock Purchase Plan		32		27

Effective November 4, 2021, 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, 2023 (the “2021 Repurchase Authorization”). On February 10, 2022, the Company's Board of Directors authorized the addition of 5,000,000 shares of CRD-A or CRD-B (or a combination of the two) to its 2021 Repurchase Authorization. The Company's Board of Directors subsequently amended this authorization to allow for repurchases through December 31, 2024. Under the repurchase program, repurchases may be made through December 31, 2024 in the open market or privately negotiated transactions at such times and for such prices as management deems appropriate, subject to applicable regulatory guidelines. The authorization does not obligate Crawford to acquire any stock, and purchases may be commenced or suspended at any time based on market conditions and other factors that the Company deems appropriate. At March 31, 2024, there were 1,413,787 remaining shares authorized to repurchase under the 2021 Repurchase Authorization.

During the three months ended March 31, 2024, the Company did not repurchase any shares of CRD-A and repurchased 85,632 shares of CRD-B at an average cost of $8.56. During the three months ended March 31, 2023, the Company did not repurchase any shares of CRD-A or CRD-B.