Summary
Cintas Corporation's (CTAS) 10-Q filing for the period ending August 31, 2017, reveals a strong performance driven by the significant acquisition of G&K Services, Inc. Total revenue surged by 27.2% to $1.61 billion, with organic growth contributing 8.3%. The Uniform Rental and Facility Services segment was the primary growth engine, up 31.9% year-over-year, largely due to the G&K acquisition. Despite increased costs and selling, general, and administrative expenses associated with integration and investments, Cintas demonstrated robust profitability. Net income from continuing operations increased by 18.3% to $161.1 million, translating to diluted EPS from continuing operations of $1.45, up 16.9%. The company also reported significant income from discontinued operations following the sale of a business. Cintas maintained a strong liquidity position, with operating cash flow increasing substantially to $254.4 million. The company remains compliant with its debt covenants and continues to manage its capital structure effectively.
Financial Highlights
51 data points| Revenue | $1.61B |
| Gross Profit | $739.35M |
| SG&A Expenses | $486.28M |
| Operating Income | $249.10M |
| Interest Expense | $30.32M |
| Net Income | $217.21M |
| EPS (Basic) | $0.51 |
| EPS (Diluted) | $0.49 |
| Shares Outstanding (Basic) | 422.96M |
| Shares Outstanding (Diluted) | 434.15M |
Key Highlights
- 1Total revenue increased by 27.2% to $1.61 billion, driven by a 18.9% contribution from acquisitions, primarily G&K Services, Inc., and 8.3% organic growth.
- 2Uniform Rental and Facility Services segment revenue grew 31.9% to $1.31 billion, benefiting from both organic growth and the G&K acquisition.
- 3Net income from continuing operations rose 18.3% to $161.1 million, with diluted EPS from continuing operations increasing 16.9% to $1.45.
- 4Income from discontinued operations was a significant contributor ($56.1 million), reflecting the sale of a business during the quarter.
- 5Operating cash flow surged by 61.4% to $254.4 million, indicating strong cash generation capabilities.
- 6The company reported $2.81 billion in goodwill, primarily from the G&K acquisition, and has a substantial intangible asset base related to service contracts.
- 7Cintas maintained compliance with all debt covenants and ended the period with $191.4 million in cash and cash equivalents.