UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 6800 Cintas Boulevard P.O. Box 625737 Cincinnati, Ohio 45262-5737 (Address of Principal Executive Offices) (Zip Code) Title of each class Trading symbol(s) Name of each exchange on which registered Common stock, no par value CTASThe NASDAQ Stock Market LLC (NASDAQ Global Select Market) Class Outstanding September 30, 2024 Common Stock, no par value 403,298,633 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ...

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I recommended a buy rating for Cintas Corporation (NASDAQ: CTAS ) when I wrote about it in January, as I expected revenue growth to accelerate and margin to continue expanding. Based on my current outlook and analysis, I I consider an investment ideal if it performs its core business in a sector projected to experience structural (organic) growth in excess of GDP growth over the next 5-10 years; profits from sustainable competitive advantages that translate into attractive unit economics; In the hands of co ...

Key Takeaways Cintas exceeded profit and sales estimates and raised its outlook as it had record-setting performances for the first quarter. Revenue and gross margin as a percentage of revenue set record highs, and shares hit an all-time high Wednesday. CEO Todd Schneider said the company continued to see strong demand from existing and new customers. Cintas (CTAS) shares hit an all-time high Wednesday as the uniform and other workplace supplies provider posted better-than-expected results and raised its gu ...

Cintas Corporation (CTAS) reported first-quarter fiscal 2025 (ended Aug. 31, 2024) earnings of $1.10 per share, which beat the Zacks Consensus Estimate of $1.00. The bottom line increased 18.3% year over year despite an increase in operating costs. Total revenues of $2.502 billion marginally outperformed the consensus estimate of $2.497 billion. The top line rose 6.8% year over year, driven by higher segmental revenues. Organic sales were up 8% year over year. Cintas' Segmental Results The company has two r ...

Financial Data and Key Metrics - Q1 2025 total revenue grew 6.8% YoY to $2.5 billion, an all-time high for quarterly revenue [3] - Organic revenue growth adjusted for acquisitions, FX, and workdays was 8.0% [4] - Gross margin increased 9.7% YoY to a record 50.1% [6] - Operating income as a percentage of revenue reached 22.4%, up 12.1% YoY [6] - Diluted EPS grew 18.3% to $1.10, reflecting a recent 4-for-1 stock split [6] - Free cash flow increased 62.4% YoY, enabling capital deployment across priorities [7] Business Segment Performance - Uniform rental and facility services organic growth was 7% [11] - First aid and safety services organic growth was 14% [11] - Fire protection services organic growth was 13.8% [11] - Uniform direct sales organic growth declined 1.8% [11] - Gross margin by segment: uniform rental (49.3%), first aid and safety (57.7%), fire protection (50.2%), uniform direct sales (40.6%) [11] Market and Strategic Focus - Strong demand across healthcare, hospitality, education, and state/local government verticals [5] - Continued focus on serving 16 million businesses in North America [5] - Investments in technology, including partnerships with Verizon, Google, and SAP, to improve customer experience and operational efficiency [7][8] - Capital allocation priorities include strategic investments, acquisitions, and returning capital to shareholders via dividends and share repurchases [7][8] Management Commentary on Outlook - Raised FY2025 revenue guidance to $10.22-$10.32 billion, representing 6.5%-7.5% growth [9] - Expected organic growth rate of 7.0%-8.1% for FY2025 [9] - Diluted EPS guidance raised to $4.17-$4.25, reflecting 10.0%-12.1% growth [9] - Confidence in long-term growth driven by operational excellence and strategic investments [9] Q&A Session Highlights Question: Customer purchasing behavior and macro environment - No significant changes in customer behavior or demand observed [20] - Strong demand continues across key verticals [20] Question: Growth in healthcare, hospitality, education, and government verticals - Investments in these verticals are paying off, with examples of innovative solutions like garment dispensing and privacy curtain management in healthcare [21][22][23][24] Question: New sales breakdown between market share wins and no-programmer conversions - Approximately two-thirds of new customers come from the no-programmer market [26] - Wins are broad-based across industries and business sizes [27] Question: Merchandise amortization trends - Material cost trends are favorable, driven by supply chain improvements and garment sharing [28] - Expect continued tailwinds in gross margin from these factors [28] Question: SmartTruck and Google partnership progress - SmartTruck technology improves route optimization and customer interaction time [30][31] - Google partnership enhances operational insights and efficiency [31] Question: Fire protection business growth and margin profile - Fire protection business is growing strongly, with a 50% gross margin in Q1 [32][34] - SAP implementation may pressure margins in FY2025 but is expected to yield long-term benefits [34][35] Question: Margin expansion drivers and sustainability - Margin expansion driven by sourcing, supply chain, technology, and operational efficiencies [37] - No one-time factors; incremental margins expected to remain in the 25%-35% range [37][56] Question: Competitive dynamics and M&A - M&A remains a key strategy, with a focus on deals that create value for customers and shareholders [40][59] - Industry consolidation is monitored but not expected to significantly alter competitive dynamics [66][67] Question: Uniform direct sales trends - Direct sales business remains lumpy, with no significant changes in underlying trends [71] - Positioned well for future growth despite recent declines [71] Question: Free cash flow strength and working capital - Strong free cash flow in Q1 driven by timing factors and accounts payable improvements [72] - Expect free cash flow conversion of net income to remain in the 90%-100% range for FY2025 [72] Question: Pricing and customer reception - Price adjustments are lower than peak inflation levels and closer to historical norms [73] - Customer reception remains challenging but manageable [73] Question: Hiring market conditions - Hiring market has eased from pandemic levels but remains competitive [74] - Continued focus on attracting and retaining talent to support growth [74]

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For the quarter ended August 2024, Cintas (CTAS) reported revenue of $2.5 billion, up 6.8% over the same period last year. EPS came in at $1.10, compared to $0.93 in the year-ago quarter. The reported revenue represents a surprise of +0.18% over the Zacks Consensus Estimate of $2.5 billion. With the consensus EPS estimate being $1.00, the EPS surprise was +10.00%. While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next ...

Cintas (CTAS) came out with quarterly earnings of $1.10 per share, beating the Zacks Consensus Estimate of $1 per share. This compares to earnings of $0.93 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 10%. A quarter ago, it was expected that this uniform rental company would post earnings of $0.95 per share when it actually produced earnings of $1, delivering a surprise of 5.26%. Over the last four quarters, the company ha ...

Revenue Growth - Revenue for Q1 fiscal 2025 was $2.50 billion, a 6.8% increase compared to $2.34 billion in Q1 fiscal 2024, with organic revenue growth of 8.0%[1] - Total revenue increased by 6.8% to $2,501.6 million compared to $2,342.3 million in the prior year[12] - Uniform rental and facility services revenue grew by 5.9% to $1,933.8 million[12] - Other revenue increased by 10.1% to $567.7 million[12] - Organic revenue growth was 8.0%, excluding acquisition and foreign currency impacts[16] - Workday adjusted revenue growth was 8.4%[16] - Workday-adjusted revenue growth for fiscal 2025 is projected at 7.3% to 8.4%, with organic revenue growth expected to be 7.0% to 8.1%[6] Profitability and Margins - Gross margin increased by 9.7% to $1.25 billion, with gross margin as a percentage of revenue rising to 50.1%, up 140 basis points from 48.7% in Q1 fiscal 2024[2] - Operating income grew 12.1% to $561.0 million, with operating income as a percentage of revenue increasing to 22.4% from 21.4% in Q1 fiscal 2024[2] - Net income rose 17.4% to $452.0 million, with diluted EPS increasing 18.3% to $1.10 compared to $0.93 in Q1 fiscal 2024[3] - Net income rose by 17.4% to $452.0 million from $385.1 million in the previous year[12] - Operating income improved by 12.1% to $561.0 million[12] - Total gross margin expanded to 50.1% from 48.7% in the prior year[13] - Net income margin increased to 18.1% from 16.4%[13] - Net income increased to $452,033 thousand for the three months ended August 31, 2024, compared to $385,085 thousand in the same period last year[20] Cash Flow and Financial Activities - Cash flow from operating activities increased 38.5% to $466.7 million, with $473.6 million spent on share repurchases and a 15.6% increase in quarterly dividend payments to $157.9 million[4] - Free cash flow surged by 62.4% to $373.8 million from $230.2 million[15] - Net cash provided by operating activities rose to $466,732 thousand from $336,945 thousand year-over-year[20] - Capital expenditures decreased to $92,921 thousand from $106,697 thousand in the previous year[20] - Acquisitions of businesses, net of cash acquired, dropped significantly to $9,436 thousand from $55,651 thousand[20] - Repurchase of common stock surged to $614,802 thousand from $73,276 thousand[20] - Dividends paid increased to $138,237 thousand from $117,565 thousand[20] - Net cash used in financing activities jumped to $592,792 thousand from $202,375 thousand[20] - Cash and cash equivalents at the end of the period stood at $101,373 thousand, up from $88,126 thousand[20] Guidance and Projections - Cintas raised its full fiscal year revenue guidance to a range of $10.22 billion to $10.32 billion, up from $10.16 billion to $10.31 billion, and diluted EPS guidance to $4.17 to $4.25, up from $4.06 to $4.19[5][7] - Workday-adjusted revenue growth for fiscal 2025 is projected at 7.3% to 8.4%, with organic revenue growth expected to be 7.0% to 8.1%[6] - Fiscal 2025 interest expense is expected to be $101.0 million, up from $95.0 million in fiscal 2024, primarily due to higher variable rate debt for share buybacks[9] - The effective tax rate for fiscal 2025 is expected to remain at 20.4%, consistent with fiscal 2024[9] - Cintas' guidance assumes no future acquisitions, a constant foreign currency exchange rate, and no significant economic disruptions[6][7]