CRD.B (CRD.B) Q2 2019 Earnings Report, Transcript and Summary

Good morning. My name is Natalia, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the Crawford & Company Second Quarter 2019 Earnings Release Conference Call. In conjunction with this call, a supplementary financial presentation is available on our website at www.crawco.com. under the Investor Relations section. [Operator Instructions] As a reminder, ladies and gentlemen, this conference is being recorded today, Tuesday, August 6, 2019. Now I would like to introduce Joseph Blanco, Crawford & Company's General Counsel.

Good morning. Some of the matters to be discussed in this conference call and in the supplementary financial presentation may include forward-looking statements that involve risks and uncertainties. These statements may relate to, among other things, our expected future operating results and financial condition, our ability to grow our revenues and reduce our operating expenses, expectations regarding our anticipated contributions to our underfunded defined benefit pension plans, collectability of our build and unbilled accounts receivable, financial results from our recently completed acquisitions, our continued compliance with the financial and other covenants contained in our financing agreements, our long-term capital resource and liquidity requirements and our ability to pay dividends in the future. The company's actual results achieved in future quarters could differ materially from results that may be implied by such forward-looking statements. The company undertakes no obligation to publicly release revisions to any forward-looking statements made in this conference call to reflect events or circumstances occurring after the date of the call or to reflect the occurrence of unanticipated events. In addition, you are reminded that operating results for any historical period are not necessarily indicative of results to be expected for any future period. For a complete discussion regarding factors which could affect the company's financial performance, please refer to the company's Form 10-Q for the quarter ended June 30, 2019, filed with the Securities and Exchange Commission, particularly the information under the headings Risk Factors and management's discussion and analysis of financial condition and results of operations as well as subsequent company filings with the SEC. This presentation also includes certain non-GAAP financial measures as defined under SEC rules. As required, a reconciliation is provided for those measures to the most directly comparable GAAP measures. I would now like to introduce Mr. Harsha Agadi, President and Chief Executive Officer of Crawford & Company. Harsha, you may begin your conference.

Good morning, and welcome to our second quarter 2019 earnings call. Joining me today are Bruce Swain, our Chief Financial Officer; and Joseph Blanco, our General Counsel. After our prepared remarks, we will open the call for your questions. Turning to our second quarter results. We delivered GAAP revenue before reimbursements of $256.9 million. On a constant currency basis and excluding GCG in the prior year quarter, we delivered revenue before reimbursements of $264.2 million, which remained flat as compared to revenue of $265.1 million in the year ago second quarter. Despite the fact that our revenues were flat in the quarter, we had a significant amount of new client momentum that demonstrates that our sales efforts are taking shape. I will touch on that in a moment. We achieved adjusted operating earnings on a non-GAAP basis of $22.9 million, rising 6% from the $21.7 million that we achieved in the 2018 second quarter, which represents a sequential improvement of approximately $8 million from the $14.6 million that we delivered in the first quarter of this year. As discussed on our first quarter call, the strategic investments that we have made in our sales functions to drive market share and in new product development to access large untapped market opportunities are driving real momentum in our business. This can be clearly seen in our new business development, where we have seen a sharp acceleration in new client wins, which provide strong visibility to future revenue growth. Through the second quarter, we have signed $47 million in annual revenue value from our customers, which compares to $30 million year-to-date in 2018. We have also signed 38 more new customers in our GTS business compared to the same time last year. These GTS clients generate revenue when large losses occur and are another sign of the momentum in our new business activity. Over the next year, these wins will continue to ramp up and translate to revenues and provide confidence in our ability to deliver our full year 2019 guidance. Additionally, we remain firmly on track to deliver our long-term goal of achieving 5% revenue growth and 15% earnings growth annually. Looking forward, our new business pipelines remain at high levels, which speaks to the momentum that we continue to have across our sales offices globally. This strong activity is a direct result of the investments in technology and innovation that we have made over the last 2 years. Through growth driven by the traction that we're seeing in our industry solutions we have reduced our weather-related volatility. As we continue to grow the recurring segments of our business, we expect our weather-related business to be an important but a less material component of our overall business. Today, Crawford remains the preeminent independent provider of outsourced claims management solutions with an unparalleled competitive position and market-leading brands that are well recognized around the globe. To deliver value to our shareholders, we're moving Crawford to sustainable growth. Simply put, we are transitioning our business model towards more predictable recurring revenue while still maintaining our competitive position in the weather-driven market segments. The advantage that Crawford has is our sole focus on outsourced claims management. We have the scale and resources to invest in R&D and the financial flexibility enabled by our low leverage levels to deliver industry-leading solutions that solve our clients' most complex challenges. As innovation continues to disrupt our industry, we're meeting it head on. This innovation can be seen in the many solutions that we have introduced, including our industry vertical solutions focused on construction, hospitality and the transportation industries. Client adoption has been strong as we have secured more than 40 new clients across the 3 verticals with a new business pipeline that is currently tracking more than 170 client opportunities. Looking ahead, we expect to launch solutions targeting the real estate and retail verticals. We have also introduced the industry's first smart water detection and mitigation solution to address water damage claims, which we are very proud to say was just announced as a winner in the 2019 Business Insurance Innovation awards. An essential element of our strategy is putting innovation into action with our clients. This enables us to become the outsourced provider of choice for both large and small insurers claims departments. This will give us a more predictable and steady flow of claims, and as a result more predictable and recurring revenues. Along these lines, I'm very pleased to announce that we won a marquee client in the second quarter that brings our strategy to life. The new client is a top 15 P&C carrier in the United States who will be outsourcing to Crawford 100% of the claims administration for their small business program, where we expect to handle claims for workers' compensation, liability, auto and property. This client will be led by our Broadspire TPA global service line, but the work will benefit all of our business lines, including contractor connection and GTS. We expect annual claims to be in excess of 10,000 in the first full year. This business launched with us on July 1. We also see and have started a pilot program with a small and medium carrier who writes homeowners policies. U.S. Crawford claims solutions will utilize our innovative TruLook triage model to help the carrier place claims in the correct channels while accelerating claim closures and lowering their loss adjusting expense. This will enable the insurer to focus on product development and growth. Since mid-June, we have received over 2,500 claims consisting of both new daily claims and takeover claims. This is a prime example of the type of carrier account we want as it touches on all parts of our Crawford claims solutions capabilities and allows the client to benefit from our integrated solution that addresses the entire continuum of claims. These 2 wins are based on a pilot that we did with another top 15 insurer in the United States where we reduced their loss adjusting cost by 63% and cycle time by 27%. Importantly, these new programs are validations of our value proposition and clearly demonstrate the value that we can deliver as insurers work to improve their profitability. The outsourced market for internally run claims department is significant and our ongoing client discussions are very encouraging. Beyond the large-scale outsourcing agreements that we're pursuing, our innovation is also driving increased client engagement and discussion. This is driving the very strong new client activity and new business pipelines that we have experienced year-to-date. That said, when I meet with our clients, I continue to find opportunities to better leverage the full breadth and depth of Crawford's portfolio of industry-leading solutions. To drive better penetration, we have identified global accounts of strategic importance and have assigned an executive sponsor and a global relationship leader. The goal is to ensure that we are delivering Crawford's full suite of solutions to our largest clients and deepening relationships at the most strategic level. This represents a very large untapped market opportunity and our scale and innovation have us poised for success. We will continue to add to our sales force where our Crawford Specialty Solutions business has been actively adding high-performing sales talent in California, Texas and Chicago. We also anticipate adding external candidates with brokering carrier experience in New York City and Atlanta by the end of the third quarter. While the primary focus is growing GTS, we have confidence this team will uncover opportunities for all of our service lines as we work to maintain the strong momentum that we have delivered through the first half of this year. Crawford Specialty Solutions is our vanguard in a changing claims industry. We will continue to bring in disruptive and specialized practices together under the CSS umbrella. An example is Crawford compliance, which is a mobile technology-based vendor risk management platform that we have launched in Canada and have just had our first large win with a big box retailer there. Forensic accounting and forensic engineering are also examples of businesses we will continue to bring under this umbrella. While our growth initiatives are firmly taking hold, I am also very pleased with the customer validation that we're receiving as our Net Promoter Score for our entire business reached 47 this year, which shows continued improvement. Beyond our strategic initiatives designed to drive growth, our management team has also been focused on improving cash generation while delivering value to shareholders through a disciplined capital allocation strategy. Notably, we generated a $27.4 million year-over-year increase in operating cash flow through the second quarter, and our free cash flow improved by $37.1 million over the prior year period. We will continue to be disciplined and use our capital to drive value for shareholders focused on investment in the business, accretive M&A and returning capital to shareholders through a consistent quarterly dividend and share repurchases. Of note, we have bought back over 700,000 shares of CRD-A and approximately 1.4 million shares of CRD-B year-to-date, representing 4% of our outstanding shares. I would now like to turn the call over to Bruce to review the financial results of the second quarter in more detail.

Thank you, Harsha. Company-wide revenues before reimbursements in the 2019 second quarter were $256.9 million and on a constant currency basis were $264.2 million. Revenues in the 2018 second quarter totaled $279 million, which included $13.9 million from the disposed of GCG business. On a non-GAAP basis, second quarter 2018 revenues, excluding the results of GCG, would have been $265.1 million, resulting in flat non-GAAP constant currency revenues in the 2019 quarter. Our net income attributable to shareholders of Crawford & Company totaled $2.6 million in the 2019 second quarter compared to a $2.4 million loss in the 2018 period. Second quarter 2019 diluted earnings per share were $0.06 for CRD-A and $0.04 for CRD-B compared to a loss of $0.04 for CRD-A and $0.06 for CRD-B in the 2018 period. As previously disclosed, during the 2019 second quarter, the company recorded an $11.4 million pretax expense related to the settlement of arbitration involving 3 of the former executives of our disposed of Garden City Group business line. After tax, this equated to $0.15 per share. During the 2018 second quarter, we sold our GCG business line and recognized a pretax loss on disposal of $17.8 million or $0.25 per share after income tax. On a non-GAAP basis, second quarter 2019 diluted earnings per share were $0.21 for CRD-A and $0.19 for CRD-B, unchanged from the prior year quarter. The company's operating earnings totaled $22.9 million in the 2019 second quarter or 8.7% of revenues compared with $21.7 million or 8.2% of revenues in the prior year period. Consolidated adjusted EBITDA was $30.6 million in the 2019 second quarter or 11.6% of revenues compared to $32.5 million or 12.3% of revenues in the 2018 quarter. Our non-GAAP results for the current quarter have been calculated excluding the impact of FX changes and the arbitration settlement. The prior year quarter excludes the net operating results and the loss on disposal of the GCG business. I will now review the second quarter performance of each of our segments. Revenues from the Crawford Claims Solutions segment totaled $86 million, decreasing from the $93.1 million reported in last year's quarter, partially due to decreased weather activity in the U.S. and Canada. On a constant currency basis, second quarter 2019 revenues were $89.6 million. Gross profit before the allocation of indirect cost was $19.6 million or 22.7% of revenue in the 2019 quarter compared to $21.5 million or 23.1% of revenue in the 2018 quarter. Operating earnings in the segment were $1.7 million in the 2019 second quarter or 2% of revenues compared to operating earnings of $4.1 million or 4.4% of revenues in the prior year quarter. Revenues for Crawford TPA Solutions: Broadspire were $99.5 million in the 2019 second quarter, down from $102.6 million in the 2018 period, largely due to a decrease in volumes related to the timing of new client starts. On a constant currency basis, second quarter 2019 revenues were $100.8 million. Gross profit before the allocation of indirect cost was $23.7 million or 23.8% of revenue in the 2019 quarter compared to $26.5 million or 25.8% of revenue in the prior year period. Broadspire operating earnings were $5 million during the current quarter compared to last year's second quarter operating earnings of $8.1 million. The operating margin in this segment was 5.1% in the 2019 quarter and 7.9% in the 2018 quarter. As discussed, we sold our GCG business line last year, which was a component of Crawford Specialty Solutions. We have included pro forma materials in the accompanying presentation that removes GCG from the 2018 financial results to aid in comparability between the periods. Crawford Specialty Solutions revenues were $71.4 million in the 2019 second quarter, down from $83.3 million in the prior year quarter. However, included in 2018 segment revenues were $13.9 million from the disposed of GCG business line, resulting in pro forma 2018 revenues of $69.4 million. On a constant currency basis, 2019 second quarter revenues were $73.8 million, resulting in a pro forma revenue increase of 6.3% in the second quarter. Crawford Specialty Solutions gross profit before the allocation of indirect cost was $25.2 million or 35.3% of revenues in the 2019 quarter compared to $26.8 million or 32.1% of revenues in the prior year quarter. Operating earnings in Crawford Specialty Solutions totaled $12.6 million or 17.7% of revenues in the 2019 second quarter compared to operating earnings of $10 million or 12% of revenues in the 2018 quarter. The company's cash and cash equivalent position at June 30, 2019, totaled $39.2 million as compared to $53.1 million at the 2018 year-end as we are utilizing excess cash to repay outstanding borrowings. Our investment in unbilled and billed receivables has increased by $18.7 million during 2019, reflecting growth in certain international operations from increased business. That said, we will continue to better manage our billing and collection process to improve the turnover of these balances. Pension liabilities decreased slightly in the quarter due to investment performance. The company is not making voluntary contributions to its U.S. and U.K. pension plans during 2019. Our total debt increased $12.4 million from the 2018 year-end as a result of seasonal working capital needs and $19.6 million in year-to-date share repurchases, but our borrowings are down significantly year-over-year. Our net debt at the end of the 2019 second quarter was $163.7 million, reflecting our ongoing financial strength and flexibility, which is a competitive advantage for us and gives us the ability for continued investment in our business. Cash provided by operations totaled $8.7 million for the 2019 period compared to $18.7 million used in operations in the prior year. This $27.4 million improvement in cash flow was primarily due to better accounts receivable management and lower working capital requirements, including the positive cash flow impact as a result of the Garden City Group disposal and a decrease in pension contributions during 2019. Our free cash flow improved by $37.1 million year-over-year. Looking forward, improving our free cash flow generation remains a top priority for the company. During the 2019 second quarter, the company repurchased approximately 280,000 shares of CRD-A and 72,000 shares of CRD-B at a weighted average price of $9.02 per share. Year-to-date, we have repurchased approximately 700,000 shares of CRD-A and 1.4 million shares of CRD-B at a weighted average price of $9.11 per share. The company is updating its 2019 guidance to reflect the impact of foreign exchange on revenue and the GCG arbitration settlement. No other aspects of our previously issued guidance have changed. We now expect consolidated revenues before reimbursements to be in a range of $1.02 billion to $1.07 billion as compared to our prior guidance of $1.05 billion to $1.10 billion. Net income attributable to shareholders of Crawford & Company between $38 million and $43 million or $0.70 to $0.80 per diluted CRD-A share and $0.63 to $0.73 per diluted CRD-B share. Excluding the effect of the arbitration settlement recorded in the 2019 second quarter, non-GAAP net income attributable to shareholders of Crawford & Company between $46 million and $51 million or $0.85 to $0.95 per diluted CRD-A share and $0.78 to $0.88 per diluted CRD-B share. Consolidated operating earnings between $90 million and $100 million and consolidated adjusted EBITDA between $130 million and $140 million. With that, I would like to turn the call back to Harsha for concluding remarks.

Thank you, Bruce. As you can see, we have made strong progress positioning Crawford not only for growth but also for continued leadership in the outsourced claims industry. Our innovative solutions are driving increased client engagement, which is leading to strong new business pipelines across our company, which provides confidence in our outlook. More recently, we are making significant progress expanding our outsourced solutions offerings, which will increasingly reduce our reliance on extreme weather as we strive to deliver more predictable financial results. Looking forward, let me reiterate our 4 primary objectives for 2019. The first is growth, as we must increase the velocity of revenue growth through continuous innovation as we work to deliver our goal of achieving 5% revenue growth and 15% earnings growth annually. As we have discussed, we're well on our way as we have increased new client wins, while expanding our new business pipelines which will translate to accelerating revenue growth as we progress through 2019. The second is systems readiness, as we prioritize IT investments across the globe in order to position Crawford to be at the forefront of innovation and disruption. The third is people readiness, where we need to continue to attract, develop, engage and retain the caring and capable people who deliver the company's mission every day. And lastly, we need to remain fiscally responsible as we continue to focus on improving the company's free cash flow, while maintaining prudent expansion management and the most conservative balance sheet in the market, while maximizing our return on invested capital. All of which will position the company to achieve our mission of restoring and enhancing lives, businesses and communities, while delivering on our financial target of 5% revenue and 15% earnings growth annually. Thank you to all of our employees worldwide who are delivering on our mission and to our shareholders and clients who have placed their trust in us for over 78 years. Thank you again for your time today. Operator, please open the call for questions.

[Operator Instructions] Your first question is from the line of Greg Peters with Raymond James.

Congrats. So obviously, the rhetoric around strong sales and the momentum with new client wins isn't fully reflected in your second quarter results, I think all segments were down on a revenue basis year-over-year. I suppose what you're implying is beginning in the third quarter we're going to see the results -- the revenue results turn and actually become positive on a year-over-year basis. That's correct, right?

Yes. So I think, first of all, Greg, we have to adjust for foreign exchange on the revenue line. It is a significant movement this year as it is across the board on a lot of the U.S.-based companies that are reporting. And I would say that a number of clients have started up and many of them, if you will, in June and a few of them starting actually 1st July. So your assessment of we should start seeing revenue climbing versus year ago in Q3 is an accurate estimate. Now having said that, I cannot predict future foreign exchange movement, which is looking increasingly volatile, as you can see, whether it is the pound or the euro, it is fairly volatile at the moment. But I would say, adjusting for foreign exchange, we should be able to see growth here because it is also reflected in some ways in our guidance because our earnings reflects the same -- earnings guidance.

The other thing that I'd point out there is that the prior year has Garden City Group...

Especially in CSS.

CSS of $13.9 million. And so when you adjust for that, the CSS segment on a constant currency basis was up a little bit over 6% quarter-over-quarter.

Correct. It showed 6% growth adjusting for FX on GCG.

So I mean, I was struck by your longer-term objective of 5% annual revenue growth, and I just pulled up the company's consolidated results and it doesn't look like you -- the company has hit that objective in the last 7 years, maybe longer.

Yes. That's a fair statement. I can't reflect going all the way back 7 years, but yes, what I will say, Greg, is that the amount of momentum, energy, focus on new client wins as well as pushing our verticals that we launched last year, for example, the hospitality, for example, the transportation, the construction verticals and now we have retail and real estate ramping up, the approach is very different, and we are seeing that in the slew of client wins. We had just in GTS alone 38 additional nominations. So GTS has been a big space -- winning space for us. We have a large client that's continuing to ramp up in contractor connection. We have -- as I mentioned during my initial talk, we have a top 15 U.S. P&C client that actually began July 1 with a 100% total outsource on their small business program, which is hitting all global service lines led by TPA. And we also have more recent wins that I'll wait to really discuss in the next quarter. But we have significant momentum that we had not had and yes it takes a while to build. There is ramp-up time. There is transition time in this industry and that is literally we're on the cusp as we speak.

Excellent. So another sort of strategic question for you, and I appreciate your answer on the revenue side. The rhetoric we hear from the insurance industry is all about using artificial intelligence and automation to streamline and eliminate costs associated with claims adjusting. So it feels like there's this natural headwind to your business, and maybe that's the opportunity you have. But one of your peers, as you know, is Gallagher and they've been able to post better results over the last 5 years than your company. And I'm just curious, have you guys thought about expanding your footprint and getting into insurance brokerage as an adjacency to what you're doing on the claims side to improve the profile of the company? Or maybe I'm just going off in an unrelated tangent.

Well, here's -- no your thinking allowed and that's fair. So first of all, let me say the following and I'll address the Gallagher issue specifically in my response. To begin with, we have focused very heavily on innovation, and we're able to do that for a multitude of reasons. One is we actually have a very sharp, in my opinion, information technology group that has actually put in play, if you will, 600 bots in terms of robotic process automation. In addition to that, we're also one of the first ones and actually we've announced the escape of water, water sensors that's actually rolling out with a top 10 client that will generate the first notice of loss as well as impact, if you will, positively all our global service lines. In addition to that, we tested our solution, I'll call as TruLook, which is branded, and what TruLook is really the triaging of claims very rapidly. We tested this with a top 15 insurer. And the amazing thing with this is, it is dropping loss adjusting cost by 63% and cycle time by 27%. We are a company with low leverage unlike our competitors which are very heavily levered. We also have more financial flexibility; therefore, putting a lot of dollars behind the innovation in a very, very efficient manner. Large carriers may have the resources. Small and medium carriers do not have the resources, but they focus more, if you will, on their growth and underwriting while we're bringing the solution and claims. Our single-minded focus, our very existence is to be the best claims management company on a global basis. That is our focus, and that's what we're going to be best at. Now I think I may have indirectly answered your comment on the brokerage business. I would say, at this time, Greg, we're not looking at the brokerage business because we see so much potential in the claims management world. Just as a snapshot, there are about 6,000 carriers in the United States; 2,500 carriers in P&C, of which over 2,000 are sub-$5 billion who look for companies like us, if you will, to give the solution on the total claims from end-to-end. And I think there is that much whitespace that we're going after, and that's why not only are we investing in innovation, we're investing heavily in the sales force and heavily focusing on ramping up in these verticals that we have identified as large opportunities. So to me, I think any company to be successful has to be very singularly focused and actually identify what we should not get into and what we should get into. Rightly so, you asked a very good question because I came from outside the industry and I did examine exactly what you said and I realized the whitespace in our existing industry is so large in claims that we can continue to grow the business.

Your next question is from the line of Mark Hughes with SunTrust.

Do you think with the new business wins you've got in hand and what you see in the pipeline, do you think next year could be a 5% type of growth year?

I would -- first of all, we don't put guidance out, as you know, into 2020. But with the amount of winning that has been going on, we're definitely going to see a ramp-up. We're seeing that as we speak, and it will continue through Q3, Q4. So we should have a reasonably good 2020 as well without going into the details, but we have significant wins. There's just no ways around it.

The Broadspire TPA margin was down. Is that the reduced case volume? Is there some level of investment that's going on around some of the new business initiatives? What's been the headwind there?

Sure. So very, very quickly, you are right, the case volumes are down a little bit. We did have 2 clients leave us at the end of last year, beginning of this year, that had some impact on the numbers. But it's receding here quickly because we've had a ramp-up of 15-plus clients at the end of Q2, beginning of Q3. They've all started up. So that ramp-up is on. That will eclipse, if you will, the 2 clients who left us. Ramp-up is slower than predicted. I wish they had started at the end of Q1. The good news is they have started and all 15-plus have started. We have invested increasingly in the sales force on Broadspire as well as account management. In addition to that, we have put in play now to 300 to 400 bots in robotic process automation that will start reducing the cost as well as increase the accuracy of handling. We have invested in data analytics. The sales force that we have invested in is starting to bear fruit. Our pipeline is larger than ever before. $226 million is the pipeline in the TPA business. They've had significant wins. And they have also been the architect, if you will, of a full outsource with the top 15 carrier on the small business program that is ramping up quite nicely within TPA, as we speak. So you'll see Q2 will not have a lot of this coming through. But we are now starting to experience it as we're now in the second month of Q3.

Bruce, the cash flow in the second half, when do you actually make the payment on arbitration settlement? And then what's the view on the cash flow otherwise in the second half?

Yes. So we'll make the payment in the third quarter. So the payments actually been made. We're very pleased with where our operating cash flow and free cash flow has progressed for the first half of the year. While that $10 million payment will be a bit of a headwind to us, we're also not making discretionary pension contributions this year. So if you think about it year-over-year, those 2 items basically will kind of offset each other. We're expecting for year-over-year as we exit this year to see a material improvement in our operating cash flow as compared to the end of last year. So we still think we've got a lot of opportunity that's sitting on our balance sheet in unbilled and billed accounts receivable. We are very active in all levels of the company in accelerating our billing and then focusing on collection. So we expect for that to give us a bit of a push as we exit the year and expect to have very strong cash flow for the full year.

And Harsha, the P&C carrier outsourcing, it sounds like a nice piece of business with the small business program. Do you see momentum building more broadly? I know you've been pushing this initiative, but are the carriers on their end, are they making moves in that direction?

Yes. So first of all, we're blessed actually to have somebody like Rohit Verma, our Chief Operating Officer, come from a long experience with one of the carriers and he has been pushing very hard in architecting these wins on the 100% outsourcing. What we have identified, Mark, is there are over 2,000 small- and mid-sized carriers that cannot really spend the money either in innovation or the disruption that's going on, and they would prefer to push their resources, if you will, towards sales and marketing and underwriting and focus more in handing over the claims to us as a total outsource. So there is a large white space we're going after without going through a lot of detail. So we will see more traction in this space. In addition, I think we're the only company, in my humble opinion, that has really the end-to-end claims solutions and that also makes a big difference as carriers are talking on 100% outsourcing, if you will.

There are no further questions. I will now turn the call over to Mr. Agadi for closing remarks.

Well, thank you very much for all those listening, and we will meet you again on the call on Q3. And I appreciate all the efforts from our employees and the patience from our shareholders and the business from our clients. Thank you.

Thank you for participating in today's Crawford & Company Conference Call. This call will be available for replay beginning at 11:30 a.m. today through 11:59 p.m. on September 6, 2019. The conference ID number for replay is 6551409. The number to dial for replay is 1 (855) 859-2056 or (404) 537-3406. Thank you. You may now disconnect.