Financial Data and Key Metrics Changes - Total revenue for the first quarter grew by 8.7% to $2.72 billion, with an organic growth rate of 7.8% [4][6] - Gross margin as a percentage of revenue increased by 20 basis points to 50.3% [4] - Operating income rose to $617.9 million, a 10.1% increase year-over-year [4][11] - Diluted EPS increased by 9.1% to $1.20 [4][11] - Cash flow from operating activities was $414.5 million [11] Business Line Data and Key Metrics Changes - Organic growth by business: - Uniform rental facility services: 7.3% - First aid and safety services: 14.1% - Fire protection services: 10.3% - Uniform direct sale declined by 9.2% [8] - Gross margin percentages by business: - Uniform rental facility services: 49.7% - First aid and safety services: 56.8% - Fire protection services: 48.9% - Uniform direct sale: 41.7% [9] Market Data and Key Metrics Changes - The customer base remained steady, with slight improvements noted during the quarter [26][50] - Retention rates were described as very attractive, indicating strong customer loyalty [26] Company Strategy and Development Direction - The company is focused on converting non-programmers to customers, particularly in uncertain economic environments [19][20] - Continued investments in technology and operational efficiency are seen as key drivers for future growth [5][99] - The company raised its fiscal 2026 financial guidance, expecting revenue between $11.06 billion and $11.18 billion, and diluted EPS between $4.74 and $4.86 [6][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to grow despite macroeconomic uncertainties [15][26] - The company is committed to delivering exceptional customer experiences and making necessary investments for sustained growth [15] - Management noted that the overall selling environment remains stable, with no significant changes in sales cycles [26][60] Other Important Information - The company announced a 15.4% increase in its quarterly cash dividend, marking the 42nd consecutive year of dividend increases [12] - The company is actively engaged in share buybacks, repurchasing $347.4 million of its shares [12] Q&A Session Summary Question: Impact of macroeconomic pressures on converting non-programmers - Management indicated that they can grow in various ways, especially in environments where customers face budget pressures, helping them free up cash flow [19][20] Question: Update on the fire protection services and SAP implementation - Management acknowledged additional costs associated with SAP implementation but remains optimistic about the long-term growth of the fire protection business [21][22] Question: Overall selling environment and client budget trends - Management reported no significant changes in customer behavior or sales cycles, with retention rates improving slightly [26][27] Question: Impact of decelerating non-farm payrolls on rental business - Management noted that they can grow even with stagnant job growth, focusing on converting non-programmers and selling additional services [33][34] Question: Changes in competitive environment - Management stated that the market remains competitive, but they focus on the large untapped market of do-it-yourselfers rather than traditional competitors [72] Question: Update on tariff-driven expense growth - Management confirmed that while tariffs have impacted costs, their global supply chain provides a competitive advantage [56][58] Question: First aid segment gross margins - Management explained that gross margins were flat sequentially and attributed any year-over-year changes to timing and investment strategies [65][66] Question: M&A pipeline and appetite for expansion - Management emphasized the importance of M&A for growth, with a focus on tuck-in deals and maintaining strong relationships for future opportunities [80][82] Question: Outlook for first aid and safety services business - Management expects low double-digit growth for the first aid business moving forward, supported by ongoing investments [86][87]