Cintas' Q3 Earnings & Revenues Surpass Estimates, EPS View Up

Core Insights - Cintas Corporation reported Q3 fiscal 2025 earnings of $1.13 per share, exceeding the Zacks Consensus Estimate of $1.05, with a year-over-year increase of 17.7% despite rising operating costs [1] - Total revenues reached $2.61 billion, slightly above the consensus estimate of $2.60 billion, marking an 8.4% year-over-year growth driven by higher segmental revenues, with organic sales up 7.9% [1] Segmental Results - The Uniform Rental and Facility Services segment, accounting for 77.5% of net sales, generated revenues of $2.02 billion, reflecting a 7.7% year-over-year increase, surpassing the estimate of $2 billion [3] - The First Aid and Safety Services segment, representing 11.6% of net sales, reported revenues of $301.8 million, up 14.9% year over year, exceeding the estimate of $293.6 million [4] - Revenues from All Other businesses, making up 10.9% of net sales, totaled $286.3 million, a 7.2% year-over-year increase, slightly below the estimate of $288.5 million [4] Margin Profile - Cintas' cost of sales rose 5.9% year over year to $1.29 billion, constituting approximately 49.4% of net sales, while gross profit increased 11.1% to $1.32 billion, resulting in a gross margin of 50.6%, up from 49.4% in the previous year [5] - Selling and administrative expenses totaled $709.5 million, a 6.4% increase from the previous year, representing 27.2% of net sales, with operating income rising 17.1% year over year to $609.9 million and an operating margin of 23.4% compared to 21.6% in the prior year [6] Balance Sheet & Cash Flow - As of the end of Q3 fiscal 2025, Cintas had cash and cash equivalents of $243.4 million, down from $342 million at the end of the previous fiscal year, with long-term debt remaining around $2.03 billion [7] - In the first nine months of fiscal 2025, Cintas generated net cash of $1.53 billion from operating activities, a 10.3% increase year over year, with capital expenditures totaling $294.3 million, down 4.3% year over year, and free cash flow increasing 14.5% to $1.24 billion [8] FY25 Guidance - For fiscal 2025, Cintas expects revenues between $10.28 billion and $10.305 billion, higher than the previous guidance of $10.255 billion to $10.32 billion, with an estimated earnings per share range of $4.36 to $4.40, up from the earlier range of $4.28 to $4.34 [9] - The midpoint of the new revenue guidance aligns with the Zacks Consensus Estimate, while the earnings per share midpoint exceeds the consensus estimate of $4.31 [10]