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Cintas Corporation Announces Fiscal 2020 Second Quarter Results

December 17, 2019 GMT

CINCINNATI--(BUSINESS WIRE)--Dec 17, 2019--

Cintas Corporation (Nasdaq: CTAS) today reported results for its fiscal 2020 second quarter ended November 30, 2019.

Revenue for the second quarter of fiscal 2020 was $1.84 billion, an increase of 7.3% over last year’s second quarter. The organic revenue growth rate, which adjusts for the impacts of acquisitions and foreign currency exchange rate fluctuations, was also 7.3%. The organic revenue growth rate for the Uniform Rental and Facility Services operating segment was 5.8%, and the organic revenue growth rate for the First Aid and Safety Services operating segment was 10.6%.

Gross margin for the second quarter of fiscal 2020 of $852.4 million increased 10.0% from last year’s second quarter. Gross margin as a percentage of revenue was 46.2% for the second quarter of fiscal 2020 compared to 45.1% in the second quarter of fiscal 2019. Uniform Rental and Facility Services operating segment gross margin as a percentage of revenue improved 130 basis points from last year’s second quarter to 46.6%, and the First Aid and Safety Services operating segment gross margin as a percentage of revenue improved 40 basis points to 48.4%.

Operating income for the second quarter of fiscal 2020 of $334.5 million increased 21.3% from last year’s second quarter operating income of $275.6 million. Operating income as a percentage of revenue was 18.1% in the second quarter of fiscal 2020 compared to 16.0% in the second quarter of fiscal 2019. Operating income in the second quarter of fiscal 2019 was impacted by non-recurring integration expenses related to the G&K Services, Inc. (G&K) acquisition of $7.8 million, or 50 basis points.

Net income from continuing operations was $246.4 million for the second quarter of fiscal 2020, and earnings per diluted share (EPS) from continuing operations were $2.27. Net income from continuing operations was $243.0 million in the second quarter of fiscal 2019, and EPS from continuing operations were $2.18. Fiscal 2019 second quarter EPS from continuing operations included a one-time gain on the sale of a cost method investment of $0.47 and non-recurring G&K integration expenses of $0.05.

The following table provides a comparison of fiscal 2020 second quarter EPS to fiscal 2019 second quarter EPS:

 

Three Months Ended

 

November 30,

2019

 

November 30,

2018

 

Growth vs.

Fiscal 2019

 

 

 

 

 

 

EPS - continuing operations

$

2.27

 

 

$

2.18

 

 

 

G&K integration expenses

 

 

0.05

 

 

 

One-time gain on sale of investment

 

 

(0.47

)

 

 

EPS excluding above items

$

2.27

 

 

$

1.76

 

 

29.0%

 

 

 

 

 

 

 

Six Months Ended

 

November 30,

2019

 

November 30,

2018

 

Growth vs.

Fiscal 2019

 

 

 

 

 

 

EPS - continuing operations

$

4.60

 

 

$

4.07

 

 

 

G&K integration expenses

 

 

0.09

 

 

 

One-time gain on sale of investment

 

 

(0.47

)

 

 

EPS excluding above items

$

4.60

 

 

$

3.69

 

 

24.7%

Scott D. Farmer, Cintas’ Chairman and Chief Executive Officer, stated, “We are pleased with our second quarter and year-to-date performance. The Company is on pace to achieve another year of strong growth in revenue, earnings and cash flow generation. I thank our employee-partners for the consistently high execution that helps get our customers Ready for the Workday™.”

Mr. Farmer added, “Earlier this month, on December 6 th, we paid an annual dividend of $2.55 per share, an increase of 24.4% over last year’s annual dividend. We have increased the annual dividend for 36 consecutive years. In the past 10 years, the annual dividend per share increased at a compound annual growth rate of 18.2%.”

Mr. Farmer concluded, “We are increasing our fiscal 2020 financial guidance. We are raising our annual revenue expectations from a range of $7.28 billion to $7.32 billion to a range of $7.29 billion to $7.33 billion and EPS from a range of $8.47 to $8.57 to a range of $8.65 to $8.75. This financial guidance does not include any future share buybacks. It does incorporate the impact of having one less workday in fiscal 2020 compared to fiscal 2019.”

The following table provides a comparison of fiscal 2020 revenue and EPS guidance to fiscal 2019 actual results:

 

Fiscal

2019

 

Fiscal 2020

Low End

of Range

 

Growth

vs.

2019

 

Fiscal 2020

High End

of Range

 

Growth

vs.

2019

 

 

 

 

 

 

 

 

 

 

Fiscal 2020 Revenue Guidance

 

 

 

 

 

 

 

 

 

($s in millions)

 

 

 

 

 

 

 

 

 

Revenue guidance

$

6,892.3

 

 

$

7,290.0

 

 

5.8%

 

$

7,330.0

 

 

6.4%

 

 

 

 

 

 

 

 

 

 

Growth on constant workday basis (1)

 

 

 

 

6.2%

 

 

 

6.8%

 

 

 

 

 

 

 

 

 

 

Fiscal 2020 Earnings Per Share Guidance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EPS - continuing operations

$

7.97

 

 

$

8.65

 

 

 

 

$

8.75

 

 

 

G&K integration expenses

0.10

 

 

 

 

 

 

 

 

 

One-time gain on sale of investment

(0.47

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EPS guidance (2)

$

7.60

 

 

$

8.65

 

 

13.8%

 

$

8.75

 

 

15.1%

(1)

Fiscal 2020 contains one less workday than fiscal 2019. One less workday negatively impacts revenue growth by 40 basis points.

(2)

One less workday negatively impacts fiscal 2020 EPS guidance by about $0.06 and EPS growth by about 90 basis points.

About Cintas

Cintas Corporation helps more than one million businesses of all types and sizes get Ready™ to open their doors with confidence every day by providing a wide range of products and services that enhance our customers’ image and help keep their facilities and employees clean, safe and looking their best. With products and services including uniforms, floor care, restroom supplies, first aid and safety products, fire extinguishers and testing, and safety and compliance training, Cintas helps customers get Ready for the Workday™. Headquartered in Cincinnati, Cintas is a publicly held Fortune 500 company traded over the Nasdaq Global Select Market under the symbol CTAS and is a component of both the Standard & Poor’s 500 Index and the Nasdaq-100 Index.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

The Private Securities Litigation Reform Act of 1995 provides a safe harbor from civil litigation for forward-looking statements. Forward-looking statements may be identified by words such as “estimates,” “anticipates,” “predicts,” “projects,” “plans,” “expects,” “intends,” “target,” “forecast,” “believes,” “seeks,” “could,” “should,” “may” and “will” or the negative versions thereof and similar words, terms and expressions and by the context in which they are used. Such statements are based upon current expectations of Cintas and speak only as of the date made. You should not place undue reliance on any forward-looking statement. We cannot guarantee that any forward-looking statement will be realized. These statements are subject to various risks, uncertainties, potentially inaccurate assumptions and other factors that could cause actual results to differ from those set forth in or implied by this Press Release. Factors that might cause such a difference include, but are not limited to, risks inherent with the G&K transaction in the achievement of cost synergies and the timing thereof, including whether the transaction will be accretive and within the expected timeframe and the actual amounts of future integration expenses; the possibility of greater than anticipated operating costs including energy and fuel costs; lower sales volumes; loss of customers due to outsourcing trends; the performance and costs of integration of acquisitions, including G&K; fluctuations in costs of materials and labor including increased medical costs; costs and possible effects of union organizing activities; failure to comply with government regulations concerning employment discrimination, employee pay and benefits and employee health and safety; the effect on operations of exchange rate fluctuations, tariffs and other political, economic and regulatory risks; uncertainties regarding any existing or newly-discovered expenses and liabilities related to environmental compliance and remediation; the cost, results and ongoing assessment of internal controls for financial reporting required by the Sarbanes-Oxley Act of 2002; the effect of new accounting pronouncements; costs of our SAP system implementation; disruptions caused by the inaccessibility of computer systems data, including cybersecurity risks; the initiation or outcome of litigation, investigations or other proceedings; higher assumed sourcing or distribution costs of products; the disruption of operations from catastrophic or extraordinary events; the amount and timing of repurchases of our common stock, if any; changes in federal and state tax and labor laws; and the reactions of competitors in terms of price and service. Cintas undertakes no obligation to publicly release any revisions to any forward-looking statements or to otherwise update any forward-looking statements whether as a result of new information or to reflect events, circumstances or any other unanticipated developments arising after the date on which such statements are made. A further list and description of risks, uncertainties and other matters can be found in our Annual Report on Form 10-K for the year ended May 31, 2019 and in our reports on Forms 10-Q and 8-K. The risks and uncertainties described herein are not the only ones we may face. Additional risks and uncertainties presently not known to us or that we currently believe to be immaterial may also harm our business.

 

Cintas Corporation
Consolidated Condensed Statements of Income
(Unaudited)
(In thousands except per share data)

 

 

Three Months Ended

 

November 30,
2019

 

November 30,
2018

 

%
Change

Revenue:

 

 

 

 

 

Uniform rental and facility services

$

1,469,976

 

 

$

1,390,778

 

 

5.7%

Other

373,773

 

 

327,490

 

 

14.1%

Total revenue

1,843,749

 

 

1,718,268

 

 

7.3%

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

Cost of uniform rental and facility services

784,937

 

 

761,119

 

 

3.1%

Cost of other

206,421

 

 

181,991

 

 

13.4%

Selling and administrative expenses

517,927

 

 

491,671

 

 

5.3%

G&K Services, Inc. integration expenses

 

 

7,847

 

 

(100.0)%

 

 

 

 

 

 

Operating income

334,464

 

 

275,640

 

 

21.3%

 

 

 

 

 

 

Gain on sale of a cost method investment

 

 

69,373

 

 

(100.0)%

 

 

 

 

 

 

Interest income

(283

)

 

(391

)

 

(27.6)%

Interest expense

26,177

 

 

24,880

 

 

5.2%

 

 

 

 

 

 

Income before income taxes

308,570

 

 

320,524

 

 

(3.7)%

Income taxes

62,127

 

 

77,530

 

 

(19.9)%

Income from continuing operations

246,443

 

 

242,994

 

 

1.4%

(Loss) income from discontinued operations, net of tax

(323

)

 

19

 

 

(1,800.0)%

Net income

$

246,120

 

 

$

243,013

 

 

1.3%

 

 

 

 

 

 

Basic earnings per share:

 

 

 

 

 

Continuing operations

$

2.35

 

 

$

2.25

 

 

4.4%

Discontinued operations

0.00

 

 

0.00

 

 

—%

Basic earnings per share

$

2.35

 

 

$

2.25

 

 

4.4%

 

 

 

 

 

 

Diluted earnings per share:

 

 

 

 

 

Continuing operations

$

2.27

 

 

$

2.18

 

 

4.1%

Discontinued operations

0.00

 

 

0.00

 

 

—%

Diluted earnings per share

$

2.27

 

 

$

2.18

 

 

4.1%

 

 

 

 

 

 

Weighted average number of shares outstanding

103,959

 

 

106,475

 

 

 

Diluted average number of shares outstanding

107,335

 

 

109,874

 

 

 

 

Cintas Corporation
Consolidated Condensed Statements of Income
(Unaudited)
(In thousands except per share data)

 

 

Six Months Ended

 

November 30,
2019

 

November 30,
2018

 

%
Change

Revenue:

 

 

 

 

 

Uniform rental and facility services

$

2,924,503

 

 

$

2,765,716

 

 

5.7%

Other

730,385

 

 

650,527

 

 

12.3%

Total revenue

3,654,888

 

 

3,416,243

 

 

7.0%

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

Cost of uniform rental and facility services

1,553,613

 

 

1,507,572

 

 

3.1%

Cost of other

399,742

 

 

358,801

 

 

11.4%

Selling and administrative expenses

1,060,923

 

 

996,305

 

 

6.5%

G&K Services, Inc. integration expenses

 

 

12,697

 

 

(100.0)%

 

 

 

 

 

 

Operating income

640,610

 

 

540,868

 

 

18.4%

 

 

 

 

 

 

Gain on sale of a cost method investment

 

 

69,373

 

 

(100.0)%

 

 

 

 

 

 

Interest income

(445

)

 

(887

)

 

(49.8)%

Interest expense

53,498

 

 

49,184

 

 

8.8%

 

 

 

 

 

 

Income before income taxes

587,557

 

 

561,944

 

 

4.6%

Income taxes

90,302

 

 

106,403

 

 

(15.1)%

Income from continuing operations

497,255

 

 

455,541

 

 

9.2%

Loss from discontinued operations, net of tax

(323

)

 

(13

)

 

2,384.6%

Net income

$

496,932

 

 

$

455,528

 

 

9.1%

 

 

 

 

 

 

Basic earnings per share:

 

 

 

 

 

Continuing operations

$

4.75

 

 

$

4.21

 

 

12.8%

Discontinued operations

0.00

 

 

0.00

 

 

—%

Basic earnings per share

$

4.75

 

 

$

4.21

 

 

12.8%

 

 

 

 

 

 

Diluted earnings per share:

 

 

 

 

 

Continuing operations

$

4.60

 

 

$

4.07

 

 

13.0%

Discontinued operations

0.00

 

 

0.00

 

 

—%

Diluted earnings per share

$

4.60

 

 

$

4.07

 

 

13.0%

 

 

 

 

 

 

Weighted average number of shares outstanding

103,638

 

 

106,652

 

 

 

Diluted average number of shares outstanding

107,114

 

 

110,257

 

 

 

CINTAS CORPORATION SUPPLEMENTAL DATA

Gross Margin Results

 

 

Three Months Ended

 

November 30,
2019

 

November 30,
2018

 

 

 

 

Uniform rental and facility services gross margin

46.6%

 

45.3%

Other gross margin

44.8%

 

44.4%

Total gross margin

46.2%

 

45.1%

Net income margin, continuing operations

13.4%

 

14.1%

 

 

 

 

 

Six Months Ended

 

November 30,
2019

 

November 30,
2018

 

 

 

 

Uniform rental and facility services gross margin

46.9%

 

45.5%

Other gross margin

45.3%

 

44.8%

Total gross margin

46.6%

 

45.4%

Net income margin, continuing operations

13.6%

 

13.3%

Reconciliation of Non-GAAP Financial Measures and Regulation G Disclosure

The press release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission. To supplement its consolidated condensed financial statements presented in accordance with U.S. generally accepted accounting principles (GAAP), the Company provides the additional non-GAAP financial measures of earnings per diluted share, cash flow and workday adjusted revenue growth. The Company believes that these non-GAAP financial measures are appropriate to enhance understanding of its past performance as well as prospects for future performance. A reconciliation of the differences between these non-GAAP financial measures with the most directly comparable financial measures calculated in accordance with GAAP are shown in the tables within the narrative of the press release or below.

 

Earnings Per Share Results

 

 

Three Months Ended

 

November 30,
2019

 

November 30,
2018

 

Growth vs.
Fiscal 2019

EPS - continuing operations

$

2.27

 

 

$

2.18

 

 

 

G&K Services, Inc. integration expenses

 

 

0.05

 

 

 

One-time gain on sale of investment

 

 

(0.47

)

 

 

EPS excluding above items

$

2.27

 

 

$

1.76

 

 

29.0%

 

 

 

 

 

 

 

Six Months Ended

 

November 30,
2019

 

November 30,
2018

 

Growth vs.
Fiscal 2019

EPS - continuing operations

$

4.60

 

 

$

4.07

 

 

 

G&K Services, Inc. integration expenses

 

 

0.09

 

 

 

One-time gain on sale of investment

 

 

(0.47

)

 

 

EPS excluding above items

$

4.60

 

 

$

3.69

 

 

24.7%

 

Computation of Free Cash Flow

 

 

Six Months Ended

 

November 30,
2019

 

November 30,
2018

Net cash provided by operations

$

571,351

 

 

$

344,567

 

Capital expenditures

(126,167

)

 

(137,614

)

Free cash flow

$

445,184

 

 

$

206,953

 

Management uses free cash flow to assess the financial performance of the Company. Management believes that free cash flow is useful to investors because it relates the operating cash flow of the Company to the capital that is spent to continue, improve and grow business operations.

 

Computation of Growth on a Constant Workday Basis

 

 

Three Months Ended

 

Six Months Ended

 

November 30,
2019

 

November 30,
2018

 

Growth
%

 

November 30,
2019

 

November 30,
2018

 

Growth
%

 

A

 

B

 

G

 

I

 

J

 

O

Revenue

$

1,843,749

 

 

$

1,718,268

 

 

7.3%

 

$

3,654,888

 

 

$

3,416,243

 

 

7.0%

 

 

 

 

 

G=(A-B)/B

 

 

 

 

 

O=(I-J)/J

 

C

 

D

 

 

 

K

 

L

 

 

Workdays in the period

65

 

65

 

 

 

130

 

131

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

E

 

F

 

H

 

M

 

N

 

P

Revenue adjusted for

workday difference

$

1,843,749

 

 

$

1,718,268

 

 

7.3%

 

$

3,683,003

 

 

$

3,416,243

 

 

7.8%

 

E=(A/C)*D

 

F=(B/D)*D

 

H=(E-F)/F

 

M=(I/K)*L

 

N=(J/L)*L

 

P=(M-N)/N

 

 

 

Fiscal
2019

 

Fiscal 2020
Low End
of Range

 

Growth
vs.
|2019

 

Fiscal 2020
High End
of Range

 

Growth
vs.
2019

 

 

 

 

 

 

 

 

 

 

Fiscal 2020 Revenue Guidance

 

 

 

 

 

 

 

 

 

($s in millions)

A

 

B

 

C

 

D

 

E

Revenue guidance

$

6,892.3

 

 

$

7,290.0

 

 

5.8%

 

$

7,330.0

 

 

6.4%

 

 

 

 

 

C=(B-A)/A

 

 

 

E=(D-A)/A

 

F

 

G

 

 

 

G

 

 

Workdays in the period

261

 

260

 

 

 

260

 

 

 

H

 

I

 

J

 

K

 

L

Revenue guidance adjusted for

workday difference

$

6,892.3

 

 

$

7,318.0

 

 

6.2%

 

$

7,358.2

 

 

6.8%

 

H=(A/F)*F

 

I=(B/G)*F

 

J=(I-H)/H

 

K=(D/G)*F

 

L=(K-H)/H

Management believes that workday adjusted revenue growth is valuable to investors because it reflects the revenue performance compared to a prior period with the same number of revenue generating days.

 

SUPPLEMENTAL SEGMENT DATA

 

Uniform Rental
and Facility
Services

 

First Aid
and Safety
Services

 

All
Other

 

Corporate

 

Total

 

 

 

 

 

 

 

 

 

 

For the three months ended November 30, 2019

 

 

 

 

 

 

 

 

Revenue

$

1,469,977

 

 

$

169,667

 

 

$

204,105

 

 

$

 

 

$

1,843,749

 

Gross margin

$

685,040

 

 

$

82,074

 

 

$

85,277

 

 

$

 

 

$

852,391

 

Selling and administrative expenses

$

398,680

 

 

$

57,434

 

 

$

61,813

 

 

$

 

 

$

517,927

 

Interest income

$

 

 

$

 

 

$

 

 

$

(283

)

 

$

(283

)

Interest expense

$

 

 

$

 

 

$

 

 

$

26,177

 

 

$

26,177

 

Income (loss) before income taxes

$

286,360

 

 

$

24,640

 

 

$

23,464

 

 

$

(25,894

)

 

$

308,570

 

 

 

 

 

 

 

 

 

 

 

For the three months ended November 30, 2018

 

 

 

 

 

 

 

 

Revenue

$

1,390,778

 

 

$

153,348

 

 

$

174,142

 

 

$

 

 

$

1,718,268

 

Gross margin

$

629,659

 

 

$

73,670

 

 

$

71,829

 

 

$

 

 

$

775,158

 

Selling and administrative expenses

$

378,921

 

 

$

52,342

 

 

$

60,408

 

 

$

 

 

$

491,671

 

G&K Services, Inc. integration

expenses

$

7,847

 

 

$

 

 

$

 

 

$

 

 

$

7,847

 

Gain on sale of a cost method

investment

$

 

 

$

 

 

$

 

 

$

69,373

 

 

$

69,373

 

Interest income

$

 

 

$

 

 

$

 

 

$

(391

)

 

$

(391

)

Interest expense

$

 

 

$

 

 

$

 

 

$

24,880

 

 

$

24,880

 

Income before income taxes

$

242,891

 

 

$

21,328

 

 

$

11,421

 

 

$

44,884

 

 

$

320,524

 

 

 

 

 

 

 

 

 

 

 

For the six months ended November 30, 2019

 

 

 

 

 

 

 

 

Revenue

$

2,924,504

 

 

$

341,757

 

 

$

388,627

 

 

$

 

 

$

3,654,888

 

Gross margin

$

1,370,891

 

 

$

166,361

 

 

$

164,281

 

 

$

 

 

$

1,701,533

 

Selling and administrative expenses

$

815,520

 

 

$

116,952

 

 

$

128,451

 

 

$

 

 

$

1,060,923

 

Interest income

$

 

 

$

 

 

$

 

 

$

(445

)

 

$

(445

)

Interest expense

$

 

 

$

 

 

$

 

 

$

53,498

 

 

$

53,498

 

Income (loss) before income taxes

$

555,371

 

 

$

49,409

 

 

$

35,830

 

 

$

(53,053

)

 

$

587,557

 

 

 

 

 

 

 

 

 

 

 

For the six months ended November 30, 2018

 

 

 

 

 

 

 

 

Revenue

$

2,765,716

 

 

$

306,765

 

 

$

343,762

 

 

$

 

 

$

3,416,243

 

Gross margin

$

1,258,144

 

 

$

147,155

 

 

$

144,571

 

 

$

 

 

$

1,549,870

 

Selling and administrative expenses

$

771,022

 

 

$

103,844

 

 

$

121,439

 

 

$

 

 

$

996,305

 

G&K Services, Inc. integration

expenses

$

12,697

 

 

$

 

 

$

 

 

$

 

 

$

12,697

 

Gain on sale of a cost method

investment

$

 

 

$

 

 

$

 

 

$

69,373

 

 

$

69,373

 

Interest income

$

 

 

$

 

 

$

 

 

$

(887

)

 

$

(887

)

Interest expense

$

 

 

$

 

 

$

 

 

$

49,184

 

 

$

49,184

 

Income before income taxes

$

474,425

 

$

43,311

 

$

23,132

 

$

21,076

 

$

561,944

 

 

Cintas Corporation
Consolidated Condensed Balance Sheets
(In thousands except per share data)

 

 

November 30,
2019

 

May 31,
2019

 

(Unaudited)

 

 

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

226,535

 

 

$

96,645

 

Accounts receivable, net

949,122

 

 

910,120

 

Inventories, net

348,304

 

 

334,589

 

Uniforms and other rental items in service

817,859

 

 

784,133

 

Income taxes, current

24,878

 

 

7,475

 

Prepaid expenses and other current assets

123,589

 

 

103,318

 

Total current assets

2,490,287

 

 

2,236,280

 

 

 

 

 

Property and equipment, net

1,425,584

 

 

1,430,685

 

 

 

 

 

Investments

218,873

 

 

192,346

 

Goodwill

2,852,801

 

 

2,842,441

 

Service contracts, net

469,933

 

 

494,595

 

Operating lease right-of-use assets, net

169,233

 

 

 

Other assets, net

260,626

 

 

240,315

 

 

$

7,887,337

 

 

$

7,436,662

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

254,611

 

 

$

226,020

 

Accrued compensation and related liabilities

124,349

 

 

155,509

 

Accrued liabilities

674,240

 

 

433,940

 

Operating lease liabilities, current

44,263

 

 

 

Debt due within one year

199,788

 

 

312,264

 

Total current liabilities

1,297,251

 

 

1,127,733

 

 

 

 

 

Long-term liabilities:

 

 

 

Debt due after one year

2,538,606

 

 

2,537,507

 

Deferred income taxes

443,857

 

 

438,179

 

Operating lease liabilities

130,580

 

 

 

Accrued liabilities

372,073

 

 

330,522

 

Total long-term liabilities

3,485,116

 

 

3,306,208

 

 

 

 

 

Shareholders’ equity:

 

 

 

Preferred stock, no par value:

 

 

 

100,000 shares authorized, none outstanding

Common stock, no par value:

1,066,814

 

 

840,328

 

425,000,000 shares authorized

FY 2020: 186,298,161 issued and 103,702,675 outstanding

FY 2019: 184,790,626 issued and 103,284,401 outstanding

Paid-in capital

134,041

 

 

227,928

 

Retained earnings

6,917,310

 

 

6,691,236

 

Treasury stock:

(4,976,360

)

 

(4,717,619

)

FY 2020: 82,595,486 shares

FY 2019: 81,506,225 shares

Accumulated other comprehensive loss

(36,835

)

 

(39,152

)

Total shareholders’ equity

3,104,970

 

 

3,002,721

 

 

$

7,887,337

 

$

7,436,662

 

Cintas Corporation
Consolidated Condensed Statements of Cash Flows
(Unaudited)
(In thousands)

 

 

Six Months Ended

 

November 30,
2019

 

November 30,
2018

Cash flows from operating activities:

 

 

 

Net income

$

496,932

 

 

$

455,528

 

 

 

 

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation

115,367

 

 

107,112

 

Amortization of intangible assets and capitalized contract costs

70,963

 

 

67,559

 

Stock-based compensation

69,398

 

 

74,784

 

Gain on sale of a cost method investment

 

 

(69,373

)

Deferred income taxes

7,632

 

 

19,227

 

Change in current assets and liabilities, net of acquisitions of businesses:

 

 

 

Accounts receivable, net

(37,940

)

 

(85,748

)

Inventories, net

(13,402

)

 

(53,227

)

Uniforms and other rental items in service

(32,744

)

 

(57,684

)

Prepaid expenses and other current assets and capitalized contract costs

(68,409

)

 

(58,161

)

Accounts payable

28,055

 

 

(1,955

)

Accrued compensation and related liabilities

(29,326

)

 

(20,969

)

Accrued liabilities and other

(17,883

)

 

(15,322

)

Income taxes, current

(17,292

)

 

(17,204

)

Net cash provided by operating activities

571,351

 

 

344,567

 

 

 

 

 

Cash flows from investing activities:

 

 

 

Capital expenditures

(126,167

)

 

(137,614

)

Purchase of investments

(10,121

)

 

(14,071

)

Proceeds from sale of a cost method investment

 

 

73,342

 

Proceeds from sale of assets

13,300

 

 

 

Acquisitions of businesses, net of cash acquired

(6,582

)

 

(6,580

)

Other, net

(2,103

)

 

(1,717

)

Net cash used in investing activities

(131,673

)

 

(86,640

)

 

 

 

 

Cash flows from financing activities:

 

 

 

(Payments) issuance of commercial paper, net

(112,500

)

 

173,500

 

Proceeds from exercise of stock-based compensation awards

63,201

 

 

32,612

 

Repurchase of common stock

(258,741

)

 

(508,129

)

Other, net

(1,952

)

 

(5,362

)

Net cash used in financing activities

(309,992

)

 

(307,379

)

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

204

 

 

(793

)

 

 

 

 

Net increase (decrease) in cash and cash equivalents

129,890

 

 

(50,245

)

Cash and cash equivalents at beginning of period

96,645

 

 

138,724

 

Cash and cash equivalents at end of period

$

226,535

 

 

$

88,479

 

 

View source version on businesswire.com:https://www.businesswire.com/news/home/20191217005810/en/

CONTACT: For additional information:

J. Michael Hansen, Executive Vice President and Chief Financial Officer - 513-972-2079

Paul F. Adler, Vice President and Treasurer - 513-972-4195

KEYWORD: OHIO UNITED STATES NORTH AMERICA CANADA

INDUSTRY KEYWORD: OTHER PROFESSIONAL SERVICES OFFICE PRODUCTS OTHER MANUFACTURING TEXTILES SPECIALTY PROFESSIONAL SERVICES MANUFACTURING RETAIL

SOURCE: Cintas Corporation

Copyright Business Wire 2019.

PUB: 12/17/2019 04:15 PM/DISC: 12/17/2019 04:15 PM

http://www.businesswire.com/news/home/20191217005810/en