CTAS
Cintas CORP
NASDAQ
10-Q: Cintas Reports Strong Q3 Performance, Driven by Organic Growth and Operational Efficiencies
Sentiment:
Quarterly Report
3 April 2025 8:07 PM
Cintas Corporation reports an 8.4% increase in revenue for the third quarter of fiscal year 2025, driven by organic growth and improved operational efficiencies.
Better than expected
The company's revenue and earnings per share exceeded the previous year's results, indicating better performance.
The company's operating income as a percentage of revenue improved, indicating better profitability.
The company's gross margin improved in both the Uniform Rental and Facility Services and First Aid and Safety Services segments, indicating better cost management.
Summary
- Cintas Corporation's total revenue increased by 8.4% to $2.609 billion for the three months ended February 28, 2025, compared to $2.406 billion for the three months ended February 29, 2024.
- The organic revenue growth rate was 7.9%.
- Uniform Rental and Facility Services revenue increased by 7.7% to $2.021 billion.
- First Aid and Safety Services revenue increased by 14.9% to $301.8 million.
- Diluted earnings per share were $1.13, an increase of 17.7% compared to the prior year.
- For the nine months ended February 28, 2025, total revenue increased by 7.7% to $7.673 billion.
- Diluted earnings per share for the nine-month period were $3.31, an increase of 18.6%.
Sentiment
Score: 8
Explanation: The document presents a positive outlook with strong revenue and earnings growth, improved operational efficiencies, and strategic share buyback programs. While there are some risks and uncertainties, the overall tone is optimistic.
Positives
- Revenue growth was positively impacted by acquisitions.
- Cost of uniform rental and facility services improved as a percent of revenue, decreasing from 51.2% to 50.0%.
- Cost of other improved as a percent of revenue, decreasing from 48.7% to 47.6%.
- Operating income improved as a percent of revenue, from 21.6% to 23.4%.
- The First Aid and Safety Services segment saw a gross margin improvement, driven by a favorable sales mix and sourcing and productivity initiatives.
Negatives
- Revenue growth was negatively impacted by foreign currency exchange rate fluctuations.
- Selling and administrative expenses as a percent of revenue increased, excluding certain one-time items, due to investments in technology and an increase in legal and professional expenses.
Risks
- The company is subject to legal proceedings and claims arising from the ordinary course of its business.
- The company is exposed to foreign currency risk through its foreign operations.
- The company's ability to access debt markets depends on its credit ratings, which could be adversely affected if ratings are lowered or withdrawn.
Future Outlook
The document contains forward-looking statements regarding future business plans and expectations, but cautions that actual results may differ due to various risks and uncertainties.
Industry Context
The document does not explicitly provide a detailed industry context beyond Cintas being a leading provider of corporate identity uniforms and related business services.
Stakeholder Impact
- Shareholders benefit from increased earnings per share and share buyback programs.
- Customers benefit from a wide range of products and services that enhance their image and help keep their facilities and employees clean and safe.
- Employees benefit from stock-based compensation and a commitment to employee health and safety.
Legal Proceedings
- The Company is a defendant in a purported class action lawsuit, City of Laurel, Mississippi v. Cintas Corporation No. 2 , filed on March 12, 2021.
- In March 2024, an agreement in principle was reached with the plaintiff which would require a one-time monetary payment related to the contract dispute of $45.0 million, which was accrued for and included in accrued liabilities on the consolidated condensed balance sheet at February 28, 2025 and May 31, 2024.
Key Dates
- 2007: Fiscal year Cintas issued senior notes
- 2015: Fiscal year Cintas issued senior notes
- 2017: Fiscal year Cintas acquired G&K Services, Inc. and issued senior notes
- 2018: Years under foreign and domestic state audits cover fiscal years back to 2018
- 2020: All U.S. federal income tax returns are closed to audit through fiscal 2020 and Cintas entered into interest rate lock agreements for forecasted debt issuances
- 2021-03-12: Date of filing of City of Laurel, Mississippi v. Cintas Corporation No. 2 lawsuit
- 2021-07-27: Date Cintas announced Board authorized a $1.5 billion share buyback program
- 2022: Fiscal year Cintas issued senior notes and entered into interest rate lock agreements for forecasted debt issuances
- 2022-07-26: Date Cintas announced Board authorized a new share buyback program for $1.0 billion
- 2024-02-29: Three and Nine Months Ended
- 2024-05-02: Date the Company announced a four-for-one split of its common stock
- 2024-05-31: Fiscal year ended
- 2024-07-23: Date Cintas announced Board authorized a new share buyback program for $1.0 billion
- 2024-07-25: Annual Report on Form 10-K for the fiscal year ended May 31, 2024 (Annual Report) filed with the SEC
- 2024-09-04: Shareholders of record, as of September 4, 2024, received three additional common stock shares for each common share held
- 2024-09-11: Shares were distributed after market close on September 11, 2024
- 2024-09-12: The Company's common stock shares began trading on a post Stock Split basis after the market opening on September 12, 2024
- 2025-02-28: Quarterly period ended
- 2025-03-23: The maturity date of the revolving credit facility is March 23, 2027
- 2025-04-03: Date of report
- 2027-03-23: The maturity date of the revolving credit facility
Keywords
revenue, earnings, Cintas, growth, services, rental, facility, safety, uniform, segment, operating, income
CTAS
Cintas CORP
NASDAQ
Sector: Industrials
Filings with Classifications
Better than expected
17 July 2025 8:31 AM
Quarterly and Annual Results
- Revenue increased by 8.0% in Q4 FY25 and 7.7% for the full FY25, demonstrating strong top-line growth.
- Organic revenue growth was robust at 9.0% for Q4 FY25 and 8.0% for FY25, indicating healthy underlying business performance.
- Gross margin reached an all-time high of 49.7% in Q4 FY25 and 50.0% for FY25, reflecting improved profitability.
- Operating income increased significantly by 9.1% in Q4 FY25 and 14.1% for FY25, with operating margin reaching an all-time high of 22.4% in Q4 FY25 and 22.8% for FY25.
- Diluted EPS increased by 9.0% in Q4 FY25 and 16.1% for FY25, indicating strong earnings performance.
- Cash flow from operating activities increased by $97.4 million in FY25, providing strong liquidity.
Capital raise
2 May 2025 4:16 PM
Debt Offering
- Cintas Corporation No. 2 is raising $400 million through the issuance of senior notes.
- The proceeds will be used for general corporate purposes.
Better than expected
3 April 2025 8:07 PM
Quarterly Report
- The company's revenue and earnings per share exceeded the previous year's results, indicating better performance.
- The company's operating income as a percentage of revenue improved, indicating better profitability.
- The company's gross margin improved in both the Uniform Rental and Facility Services and First Aid and Safety Services segments, indicating better cost management.
Better than expected
26 March 2025 8:31 AM
Earnings Release
- Cintas reported better than expected results due to strong revenue growth, improved operating margins, and increased EPS.
- The company also raised its full-year EPS guidance, indicating confidence in continued strong performance.
Worse than expected
24 March 2025 4:34 PM
8-K Filing
- The termination of acquisition talks suggests a setback in Cintas' growth strategy, as the company was unable to reach an agreement with UniFirst.
Better than expected
8 January 2025 3:06 PM
Quarterly Report
- The company's revenue growth exceeded expectations, driven by both organic growth and acquisitions.
- Operating margins improved significantly, indicating better cost management and efficiency.
- Net income and diluted earnings per share showed substantial increases, surpassing prior year results.
Delay expected
7 January 2025 10:18 AM
Merger Announcement
- The document details multiple instances where UniFirst has delayed or refused to engage with Cintas regarding the acquisition proposal, indicating a significant delay in the process.
Worse than expected
7 January 2025 10:18 AM
Merger Announcement
- The document indicates that UniFirst has repeatedly rejected Cintas's offers and refused to engage in discussions, suggesting that the proposed acquisition is facing significant resistance and may not be completed.
Delay expected
7 January 2025 9:06 AM
Merger Announcement
- The acquisition process has been delayed due to UniFirst's repeated rejections of Cintas' proposals and refusal to engage in discussions.
Worse than expected
7 January 2025 9:06 AM
Merger Announcement
- UniFirst has repeatedly rejected Cintas' offers and refused to engage in discussions, indicating a potential failure of the acquisition.
Better than expected
19 December 2024 8:31 AM
Quarterly Report
- Cintas exceeded expectations with a 7.8% increase in revenue, a 7.1% organic revenue growth, and a 21.1% increase in diluted EPS.
- The company also raised its full-year revenue and EPS guidance, indicating better than expected performance and future outlook.
Better than expected
4 October 2024 2:51 PM
Quarterly Report
- The company's revenue growth exceeded expectations with an 8.0% organic growth rate.
- Diluted earnings per share increased by 18.3%, surpassing anticipated growth.
- The company's operating margin improved to 22.4%, indicating better than expected profitability.
Better than expected
25 September 2024 8:30 AM
Quarterly Report
- Cintas exceeded expectations with strong revenue growth, margin expansion, and increased earnings per share.
- The company also raised its full-year guidance, indicating confidence in continued strong performance.
Better than expected
25 July 2024 2:01 PM
Annual Results
- The company's revenue, net income, and diluted earnings per share all showed significant year-over-year growth, indicating better than expected results.
Better than expected
18 July 2024 8:47 AM
Quarterly Report
- Cintas exceeded expectations with strong revenue growth, margin expansion, and increased earnings per share for both the fourth quarter and the full fiscal year.
- The company's cash flow from operations significantly increased, indicating strong financial health.
- The announcement of a four-for-one stock split is a positive development for shareholders.
Better than expected
5 April 2024 12:16 PM
Quarterly Report
- The company's revenue growth exceeded expectations, driven by strong organic growth and acquisitions.
- Operating income and net income showed significant improvements, indicating better-than-expected profitability.
- Diluted earnings per share increased by over 20%, surpassing analyst estimates.
Better than expected
27 March 2024 8:37 AM
Quarterly Report
- Cintas exceeded expectations with a 9.9% revenue increase, record high gross and operating margins, and a 22.3% increase in diluted EPS.
- The company also raised its full-year financial guidance, indicating confidence in continued strong performance.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.