Exhibit 99

 

UNIFIRST ANNOUNCES FINANCIAL RESULTS

FOR THE FOURTH QUARTER AND FULL YEAR

FISCAL 2011

Wilmington, MA (October 18, 2011) -- UniFirst Corporation (NYSE: UNF) today announced results for its fourth quarter and full year for fiscal 2011, which ended on August 27, 2011.

Revenues for the fourth quarter were $290.9 million, up 14.1% from $255.0 million for the same period in the prior year.  Net income was $18.0 million ($0.90 per diluted common share), compared to the fourth quarter of fiscal 2010 when net income was $17.3 million ($0.87 per diluted common share).

For the full year, revenues were $1.134 billion, up 10.5% versus $1.026 billion in the prior year.  Net income was $76.5 million for fiscal 2011 ($3.85 per diluted common share) compared to $76.4 million for fiscal 2010 ($3.90 per diluted common share).

Ronald D. Croatti, UniFirst President and Chief Executive Officer said, “We are pleased with the results of our fourth quarter as well as our full fiscal year that finished with the Company achieving record revenues in all of our operating segments.  Achieving these results in a challenging economic environment is a testament to the hard work and dedication of all of our employees.”

Core laundry revenues for the quarter were $259.3 million, up 14.3% from those reported in the same period a year ago.  Excluding the positive effect of acquisitions as well as a stronger Canadian dollar, the Company’s core laundry revenues increased 11.4%. Income from operations for this segment fell to 9.9% of revenues in the fourth quarter from 11.4% in the fourth quarter of 2010. As anticipated, the operating margin decline primarily related to increased merchandise expense and energy costs as a percentage of revenues.  These increases were partially offset by lower payroll and depreciation expense as a percentage of revenues. In addition, this segment incurred lower expense in the fourth quarter related to legal and environmental contingencies than it did a year ago.

Revenues for the Specialty Garments segment, which consists of nuclear decontamination and cleanroom operations, were $23.4 million in the fourth quarter, up 17.0% compared to the same period a year ago, primarily the result of higher direct sales.   Income from operations for this segment decreased slightly to $1.9 million in the fourth quarter from $2.0 million a year earlier due to higher operating costs.

Earnings comparisons for the quarter were positively impacted by a decrease in net interest expense of $1.6 million from the fourth quarter of fiscal 2010.  The decrease in net interest expense is due to the expiration of an interest rate swap as well as the payment of $75.0 million in private placement notes that came due on June 14, 2011.  In addition, the effective income tax rate for the quarter was 35.8% compared to 37.1% in the fourth quarter of fiscal 2010.

UniFirst continues to maintain a solid balance sheet and overall financial position.  Cash and cash equivalents on hand at the end of the fiscal 2011 was $48.8 million. In addition, the percentage of debt to total capital declined to 13.1% at the end of fiscal 2011, from 20.4% at the end of fiscal 2010.  Cash flows from operations in fiscal 2011 were $86.2 million, down from $134.0 million in fiscal 2010.

Outlook

Mr. Croatti continued, “As we move into fiscal 2012, uncertainty remains regarding domestic employment levels as well as the overall health of the economy.  In addition, as a result of our recent strong top line growth, as well as elevated fabric prices, we expect continued margin pressure related to our merchandise costs.  We currently project our fiscal 2012 revenues to be between $1.195 billion and $1.220 billion and diluted earnings per share to be between $3.65 and $3.95.”

Conference Call Information

UniFirst will hold a conference call today at 10:00 a.m. (ET) to discuss its quarterly financial results, business highlights and outlook. A simultaneous live webcast of the call will be available over the Internet and can be accessed at www.UniFirst.com.

About UniFirst Corporation

UniFirst Corporation is one of the largest providers of workplace uniforms, protective clothing, and facility services products in North America. The Company employs approximately 11,000 Team Partners who serve more than 240,000 customer locations in 45 U.S. states, Canada, and Europe from over 200 customer service, distribution, and manufacturing facilities.  UniFirst is a publicly held company traded on the New York Stock Exchange under the symbol UNF and is a component of the Standard & Poor's 600 Small Cap Index.

Forward Looking Statements

This public announcement may contain forward looking statements that reflect the Company’s current views with respect to future events and financial performance. Forward looking statements contained in this public announcement are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995 and are highly dependent upon a variety of important factors that could cause actual results to differ materially from those reflected in such forward looking statements. Such factors include, but are not limited to, uncertainties regarding the Company’s ability to consummate and successfully integrate acquired businesses, uncertainties regarding any existing or newly-discovered expenses and liabilities related to environmental compliance and remediation, the Company’s ability to compete successfully without any significant degradation in its margin rates, seasonal fluctuations in business levels, our ability to preserve positive labor relationships and avoid becoming the target of corporate labor unionization campaigns that could disrupt our business, the effect of currency fluctuations on our results of operations and financial condition, our dependence on third parties to supply us with raw materials, any loss of key management or other personnel, increased costs as a result of any future changes in federal or state laws, rules and regulations or governmental interpretation of such laws, rules and regulations, uncertainties regarding the price levels of natural gas, electricity, fuel and labor, the impact of adverse economic conditions and the current tight credit markets on our customers and such customers’ workforce, the level and duration of workforce reductions by our customers, the continuing increase in domestic healthcare costs, demand and prices for our products and services, rampant criminal activity and instability in Mexico where our principal garment manufacturing plants are located, additional professional and internal costs necessary for compliance with recent and proposed future changes in Securities and Exchange Commission, New York Stock Exchange and accounting rules, strikes and unemployment levels, the Company’s efforts to evaluate and potentially reduce internal costs, economic and other developments associated with the war on terrorism and its impact on the economy, general economic conditions and other factors described under “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended August 28, 2010 and in other filings with the Securities and Exchange Commission. When used in this public announcement, the words “anticipate,” “optimistic,” “believe,” “estimate,” “expect,” “intend,” and similar expressions as they relate to the Company are included to identify such forward looking statements.  The Company undertakes no obligation to update any forward looking statements to reflect events or circumstances arising after the date on which such statements are made.

UniFirst Corporation and Subsidiaries

Consolidated Statements of Income

	Thirteen weeks ended						Fifty-two weeks ended
	August 27,			August 28,			August 27,			August 28,
(In thousands, except per share data)	2011 (2)			2010 (2)			2011 (2)			2010
Revenues	$	290,874		$	254,950		$	1,134,126		$	1,025,939
Operating expenses:
Cost of revenues (1)		187,624			155,915			712,309			620,727
Selling and administrative expenses (1)		58,462			54,770			233,111			213,463
Depreciation and amortization		16,791			15,574			64,733			61,477
Total operating expenses		262,877			226,259			1,010,153			895,667
Income from operations		27,997			28,691			123,973			130,272
Other expense (income):
Interest expense		747			2,199			6,738			8,778
Interest income		(700	)		(536	)		(2,552	)		(2,104	)
Exchange rate (gain) loss		(103	)		(475	)		(785	)		746
		(56	)		1,188			3,401			7,420
Income before income taxes		28,053			27,503			120,572			122,852
Provision for income taxes		10,039			10,211			44,086			46,444
Net income	$	18,014		$	17,292		$	76,486		$	76,408
Income per share – Basic
Common Stock	$	0.95		$	0.92		$	4.05		$	4.11
Class B Common Stock	$	0.76		$	0.73		$	3.24		$	3.29
Income per share – Diluted
Common Stock	$	0.90		$	0.87		$	3.85		$	3.90
Income allocated to – Basic
Common Stock	$	14,132		$	13,536		$	59,944		$	59,921
Class B Common Stock	$	3,549		$	3,424		$	15,104		$	15,875
Income allocated to – Diluted
Common Stock	$	17,698		$	16,976		$	75,118		$	75,827
Weighted average number of shares outstanding – Basic
Common Stock		14,822			14,751			14,791			14,570
Class B Common Stock		4,653			4,663			4,658			4,823
Weighted average number of shares outstanding – Diluted
Common Stock		19,559			19,472			19,532			19,458

(1) Exclusive of depreciation on the Company’s property, plant and equipment and amortization on its intangible assets

(2) Unaudited

UniFirst Corporation and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands)	August 27, 2011 (1)		August 28, 2010
Assets
Current assets:
Cash and cash equivalents	$	48,812	$	121,258
Receivables, net		128,377		105,247
Inventories		76,460		47,630
Rental merchandise in service		126,536		86,633
Prepaid and deferred income taxes		11,358		14,252
Prepaid expenses		3,647		3,004
Total current assets		395,190		378,024
Property, plant and equipment:
Land, buildings and leasehold improvements		346,738		334,037
Machinery and equipment		393,530		370,088
Motor vehicles		129,762		121,135
		870,030		825,260
Less - accumulated depreciation		474,963		444,061
		395,067		381,199
Goodwill		288,249		271,857
Customer contracts and other intangible assets, net		60,905		59,037
Other assets		2,109		2,178
	$	1,141,520	$	1,092,295
Liabilities and shareholders' equity
Current liabilities:
Current maturities of long-term debt	$	20,133	$	81,160
Accounts payable		56,064		45,931
Accrued liabilities		76,630		74,905
Total current liabilities		152,827		201,996
Long-term liabilities:
Long-term debt, net of current maturities		100,163		100,304
Accrued liabilities		39,698		39,189
Accrued and deferred income taxes		50,890		42,756
Total long-term liabilities		190,751		182,249
Shareholders' equity:
Common Stock		1,499		1,491
Class B Common Stock		488		491
Capital surplus		33,588		25,329
Retained earnings		752,530		678,876
Accumulated other comprehensive income		9,837		1,863
Total shareholders' equity		797,942		708,050
	$	1,141,520	$	1,092,295

 (1) Unaudited

UniFirst Corporation and Subsidiaries

Detail of Operating Results

Revenues

	Thirteen weeks ended
	August 27,		August 28,		Dollar		Percent
(In thousands, except percentages)	2011 (1)		2010 (1)		Change		Change
Core Laundry Operations	$	259,346	$	226,991	$	32,355		14.3	%
Specialty Garments		23,420		20,024		3,396		17.0
First Aid		8,108		7,935		173		2.2
Consolidated total	$	290,874	$	254,950	$	35,924		14.1	%

	Fifty-two weeks ended
	August 27,		August 28,		Dollar		Percent
(In thousands, except percentages)	2011 (1)		2010		Change		Change
Core Laundry Operations	$	996,957	$	907,865	$	89,092		9.8	%
Specialty Garments		103,322		88,001		15,321		17.4
First Aid		33,847		30,073		3,774		12.5
Consolidated total	$	1,134,126	$	1,025,939	$	108,187		10.5	%

Income from Operations

	Thirteen weeks ended
	August 27,		August 28,		Dollar			Percent
(In thousands, except percentages)	2011 (1)		2010 (1)		Change			Change
Core Laundry Operations	$	25,728	$	25,954	$	(226	)		-0.9	%
Specialty Garments		1,850		1,997		(147	)		-7.4
First Aid		419		740		(321	)		-43.3
Consolidated total	$	27,997	$	28,691	$	(694	)		-2.4	%

	Fifty-two weeks ended
	August 27,		August 28,		Dollar			Percent
(In thousands, except percentages)	2011 (1)		2010		Change			Change
Core Laundry Operations	$	105,725	$	114,346	$	(8,621	)		-7.5	%
Specialty Garments		15,292		13,891		1,401			10.1
First Aid		2,956		2,035		921			45.3
Consolidated total	$	123,973	$	130,272	$	(6,299	)		-4.8	%

(1) Unaudited

UniFirst Corporation and Subsidiaries

Consolidated Statements of Cash Flows

Fifty-two  weeks ended (In thousands)	August 27, 2011 (1)			August 28, 2010
Cash flows from operating activities:
Net income	$	76,486		$	76,408
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation		54,188			52,107
Amortization of intangible assets		10,545			9,370
Amortization of deferred financing costs		261			267
Share-based compensation		6,732			3,662
Accretion on environmental contingencies		681			794
Accretion on asset retirement obligations		589			568
Deferred income taxes		13,318			705
Changes in assets and liabilities, net of acquisitions:
Receivables		(20,881	)		(6,308	)
Inventories		(28,413	)		(4,331	)
Rental merchandise in service		(36,369	)		(11,451	)
Prepaid expenses		(247	)		(99	)
Accounts payable		9,796			4,748
Accrued liabilities		2,654			9,257
Prepaid and accrued income taxes		(3,147	)		(1,724	)
Net cash provided by operating activities		86,193			133,973
Cash flows from investing activities:
Acquisition of businesses		(32,556	)		(20,908	)
Capital expenditures		(63,847	)		(50,015	)
Other		(397	)		(1,794	)
Net cash used in investing activities		(96,800	)		(72,717	)
Cash flows from financing activities:
Proceeds from long-term obligations		30,000			8,850
Payments on long-term obligations		(91,464	)		(9,113	)
Payment of deferred financing costs		(975	)		—
Proceeds from exercise of Common Stock options		1,360			1,177
Payment of cash dividends		(2,830	)		(2,777	)
Net cash used in financing activities		(63,909	)		(1,863	)
Effect of exchange rate changes		2,070			1,714
Net (decrease) increase in cash and cash equivalents		(72,446	)		61,107
Cash and cash equivalents at beginning of period		121,258			60,151
Cash and cash equivalents at end of period	$	48,812		$	121,258

(1) Unaudited