Washington | 0-11399 | 31-1188630 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
6800 Cintas Boulevard, P.O. Box 625737, Cincinnati, Ohio | 45262-5737 | |
(Address of Principal Executive Offices) | (Zip Code) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
(d) | Exhibits. |
Exhibit Number | Description | ||
99 | Press Release dated March 19, 2013 |
CINTAS CORPORATION | ||||
Date: March 19, 2013 | By: | /s/ William C. Gale | ||
William C. Gale | ||||
Senior Vice President and Chief Financial Officer |
Exhibit Number | Description | ||
99 | Press release dated March 19, 2013 |
Three Months Ended | ||||||||||
February 28, 2013 | February 29, 2012 | % Chng. | ||||||||
Revenue: | ||||||||||
Rental uniforms and ancillary products | $ | 748,887 | $ | 721,012 | 3.9% | |||||
Other services | 326,787 | 291,100 | 12.3% | |||||||
Total revenue | $ | 1,075,674 | $ | 1,012,112 | 6.3% | |||||
Costs and expenses: | ||||||||||
Cost of rental uniforms and ancillary products | $ | 434,809 | $ | 409,958 | 6.1% | |||||
Cost of other services | 198,924 | 176,251 | 12.9% | |||||||
Selling and administrative expenses | 308,918 | 288,367 | 7.1% | |||||||
Operating income | $ | 133,023 | $ | 137,536 | (3.3)% | |||||
Interest income | $ | (132 | ) | $ | (373 | ) | (64.6)% | |||
Interest expense | 16,302 | 17,219 | (5.3)% | |||||||
Income before income taxes | $ | 116,853 | $ | 120,690 | (3.2)% | |||||
Income taxes | 42,148 | 44,655 | (5.6)% | |||||||
Net income | $ | 74,705 | $ | 76,035 | (1.7)% | |||||
Per share data: | ||||||||||
Basic earnings per share | $ | 0.60 | $ | 0.58 | 3.4% | |||||
Diluted earnings per share | $ | 0.60 | $ | 0.58 | 3.4% | |||||
Weighted average number of shares outstanding | 123,220 | 129,735 | ||||||||
Diluted average number of shares outstanding | 123,857 | 129,945 | ||||||||
Nine Months Ended | ||||||||||
February 28, 2013 | February 29, 2012 | % Chng. | ||||||||
Revenue: | ||||||||||
Rental uniforms and ancillary products | $ | 2,259,569 | $ | 2,163,224 | 4.5% | |||||
Other services | 927,816 | 885,194 | 4.8% | |||||||
Total revenue | $ | 3,187,385 | $ | 3,048,418 | 4.6% | |||||
Costs and expenses: | ||||||||||
Cost of rental uniforms and ancillary products | $ | 1,301,859 | $ | 1,223,611 | 6.4% | |||||
Cost of other services | 565,674 | 530,067 | 6.7% | |||||||
Selling and administrative expenses | 908,512 | 895,945 | 1.4% | |||||||
Operating income | $ | 411,340 | $ | 398,795 | 3.1% | |||||
Interest income | $ | (358 | ) | $ | (1,141 | ) | (68.6)% | |||
Interest expense | 49,194 | 52,281 | (5.9)% | |||||||
Income before income taxes | $ | 362,504 | $ | 347,655 | 4.3% | |||||
Income taxes | 133,039 | 128,632 | 3.4% | |||||||
Net income | $ | 229,465 | $ | 219,023 | 4.8% | |||||
Per share data: | ||||||||||
Basic earnings per share | $ | 1.84 | $ | 1.67 | 10.2% | |||||
Diluted earnings per share | $ | 1.83 | $ | 1.67 | 9.6% | |||||
Weighted average number of shares outstanding | 124,483 | 130,261 | ||||||||
Diluted average number of shares outstanding | 124,901 | 130,321 |
Three Months Ended | ||||||||
February 28, 2013 | February 29, 2012 | |||||||
Rental uniforms and ancillary products gross margin | 41.9 | % | 43.1 | % | ||||
Other services gross margin | 39.1 | % | 39.5 | % | ||||
Total gross margin | 41.1 | % | 42.1 | % | ||||
Net margin | 6.9 | % | 7.5 | % | ||||
Depreciation and amortization | $ | 47,832 | $ | 48,060 | ||||
Capital expenditures | $ | 52,737 | $ | 37,884 | ||||
Nine Months Ended | ||||||||
February 28, 2013 | February 29, 2012 | |||||||
Rental uniforms and ancillary products gross margin | 42.4 | % | 43.4 | % | ||||
Other services gross margin | 39.0 | % | 40.1 | % | ||||
Total gross margin | 41.4 | % | 42.5 | % | ||||
Net margin | 7.2 | % | 7.2 | % | ||||
Depreciation and amortization | $ | 141,126 | $ | 145,086 | ||||
Capital expenditures | $ | 151,799 | $ | 117,716 | ||||
Debt / EBITDA | 1.9 | 1.9 | ||||||
Three Months Ended | Nine Months Ended | |||||||||||
February 28, 2013 | February 29, 2012 | Growth % | February 28, 2013 | February 29, 2012 | Growth % | |||||||
A | B | G | I | J | O | |||||||
Revenue | $1,075,674 | $1,012,112 | 6.3% | $3,187,385 | $3,048,418 | 4.6% | ||||||
G=(A-B)/B | O=(I-J)/J | |||||||||||
C | D | K | L | |||||||||
Workdays in the period | 64 | 65 | 195 | 196 | ||||||||
E | F | H | M | N | P | |||||||
Revenue adjusted for workday difference | $1,092,481 | $1,012,112 | 7.9% | $3,203,731 | $3,048,418 | 5.1% | ||||||
H=(E-F)/F | P=(M-N)/N | |||||||||||
E=(A/C)*D | F=(B/D)*D | M=(I/K)*L | N=(J/L)*L |
As of | |||||||||||||||
February 28, 2013 | |||||||||||||||
Long-term debt | $ | 1,309,330 | |||||||||||||
Letters of credit | 85,687 | ||||||||||||||
Debt | $ | 1,395,017 | |||||||||||||
Rolling Twelve Months Ended February 28, 2013 | Three Months Ended February 28, 2013 | Three Months Ended November 30, 2012 | Three Months Ended August 31, 2012 | Three Months Ended May 31, 2012 | |||||||||||
Net Income | $ | 308,079 | $ | 74,705 | $ | 78,027 | $ | 76,733 | $ | 78,614 | |||||
Add back: | |||||||||||||||
Interest expense | 67,538 | 16,302 | 16,294 | 16,598 | 18,344 | ||||||||||
Taxes | 177,714 | 42,148 | 44,851 | 46,040 | 44,675 | ||||||||||
Depreciation | 163,507 | 41,921 | 40,979 | 40,342 | 40,265 | ||||||||||
Amortization | 26,698 | 5,911 | 5,873 | 6,100 | 8,814 | ||||||||||
EBITDA | $ | 743,536 | $ | 180,987 | $ | 186,024 | $ | 185,813 | $ | 190,712 | |||||
Debt / EBITDA | 1.9 | ||||||||||||||
As of | |||||||||||||||
February 29, 2012 | |||||||||||||||
Long-term debt | $ | 1,284,909 | |||||||||||||
Letters of credit | 85,718 | ||||||||||||||
Debt | $ | 1,370,627 | |||||||||||||
Rolling Twelve Months Ended February 29, 2012 | Three Months Ended February 29, 2012 | Three Months Ended November 30, 2011 | Three Months Ended August 31, 2011 | Three Months Ended May 31, 2011 | |||||||||||
Net Income | $ | 289,799 | $ | 76,035 | $ | 74,350 | $ | 68,638 | $ | 70,776 | |||||
Add back: | |||||||||||||||
Interest expense | 65,030 | 17,219 | 17,728 | 17,334 | 12,749 | ||||||||||
Taxes | 174,762 | 44,655 | 41,010 | 42,967 | 46,130 | ||||||||||
Depreciation | 154,326 | 38,644 | 38,645 | 38,277 | 38,760 | ||||||||||
Amortization | 39,935 | 9,416 | 9,871 | 10,233 | 10,415 | ||||||||||
EBITDA | $ | 723,852 | $ | 185,969 | $ | 181,604 | $ | 177,449 | $ | 178,830 | |||||
Debt / EBITDA | 1.9 |
Nine Months Ended | ||||||||
February 28, 2013 | February 29, 2012 | |||||||
Net Cash Provided by Operations | $ | 368,343 | $ | 307,714 | ||||
Capital Expenditures | $ | (151,799 | ) | $ | (117,716 | ) | ||
Free Cash Flow | $ | 216,544 | $ | 189,998 |
SUPPLEMENTAL SEGMENT DATA | Rental Uniforms and Ancillary Products | Uniform Direct Sales | First Aid, Safety and Fire Protection | Document Management | Corporate | Total | ||||||||||||||||||
For the three months ended February 28, 2013 | ||||||||||||||||||||||||
Revenue | $ | 748,887 | $ | 126,129 | $ | 112,878 | $ | 87,780 | $ | — | $ | 1,075,674 | ||||||||||||
Gross margin | $ | 314,078 | $ | 36,829 | $ | 49,651 | $ | 41,383 | $ | — | $ | 441,941 | ||||||||||||
Selling and administrative expenses | $ | 211,531 | $ | 20,779 | $ | 39,121 | $ | 37,487 | $ | — | $ | 308,918 | ||||||||||||
Interest income | $ | — | $ | — | $ | — | $ | — | $ | (132 | ) | $ | (132 | ) | ||||||||||
Interest expense | $ | — | $ | — | $ | — | $ | — | $ | 16,302 | $ | 16,302 | ||||||||||||
Income (loss) before income taxes | $ | 102,547 | $ | 16,050 | $ | 10,530 | $ | 3,896 | $ | (16,170 | ) | $ | 116,853 | |||||||||||
For the three months ended February 29, 2012 | ||||||||||||||||||||||||
Revenue | $ | 721,012 | $ | 109,114 | $ | 101,378 | $ | 80,608 | $ | — | $ | 1,012,112 | ||||||||||||
Gross margin | $ | 311,054 | $ | 33,226 | $ | 43,759 | $ | 37,864 | $ | — | $ | 425,903 | ||||||||||||
Selling and administrative expenses | $ | 198,583 | $ | 18,745 | $ | 36,035 | $ | 35,004 | $ | — | $ | 288,367 | ||||||||||||
Interest income | $ | — | $ | — | $ | — | $ | — | $ | (373 | ) | $ | (373 | ) | ||||||||||
Interest expense | $ | — | $ | — | $ | — | $ | — | $ | 17,219 | $ | 17,219 | ||||||||||||
Income (loss) before income taxes | $ | 112,471 | $ | 14,481 | $ | 7,724 | $ | 2,860 | $ | (16,846 | ) | $ | 120,690 | |||||||||||
For the nine months ended February 28, 2013 | ||||||||||||||||||||||||
Revenue | $ | 2,259,569 | $ | 336,611 | $ | 335,232 | $ | 255,973 | $ | — | $ | 3,187,385 | ||||||||||||
Gross margin | $ | 957,710 | $ | 96,513 | $ | 144,721 | $ | 120,908 | $ | — | $ | 1,319,852 | ||||||||||||
Selling and administrative expenses | $ | 622,205 | $ | 61,318 | $ | 115,516 | $ | 109,473 | $ | — | $ | 908,512 | ||||||||||||
Interest income | $ | — | $ | — | $ | — | $ | — | $ | (358 | ) | $ | (358 | ) | ||||||||||
Interest expense | $ | — | $ | — | $ | — | $ | — | $ | 49,194 | $ | 49,194 | ||||||||||||
Income (loss) before income taxes | $ | 335,505 | $ | 35,195 | $ | 29,205 | $ | 11,435 | $ | (48,836 | ) | $ | 362,504 | |||||||||||
Assets | $ | 2,809,886 | $ | 167,835 | $ | 392,820 | $ | 605,072 | $ | 245,686 | $ | 4,221,299 | ||||||||||||
For the nine months ended February 29, 2012 | ||||||||||||||||||||||||
Revenue | $ | 2,163,224 | $ | 322,762 | $ | 306,808 | $ | 255,624 | $ | — | $ | 3,048,418 | ||||||||||||
Gross margin | $ | 939,613 | $ | 95,461 | $ | 132,346 | $ | 127,320 | $ | — | $ | 1,294,740 | ||||||||||||
Selling and administrative expenses | $ | 623,247 | $ | 59,331 | $ | 107,277 | $ | 106,090 | $ | — | $ | 895,945 | ||||||||||||
Interest income | $ | — | $ | — | $ | — | $ | — | $ | (1,141 | ) | $ | (1,141 | ) | ||||||||||
Interest expense | $ | — | $ | — | $ | — | $ | — | $ | 52,281 | $ | 52,281 | ||||||||||||
Income (loss) before income taxes | $ | 316,366 | $ | 36,130 | $ | 25,069 | $ | 21,230 | $ | (51,140 | ) | $ | 347,655 | |||||||||||
Assets | $ | 2,813,700 | $ | 153,181 | $ | 369,288 | $ | 564,383 | $ | 352,614 | $ | 4,253,166 | ||||||||||||
February 28, 2013 | May 31, 2012 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash & cash equivalents | $ | 217,470 | $ | 339,825 | ||||
Marketable securities | 28,216 | — | ||||||
Accounts receivable, net | 495,124 | 450,861 | ||||||
Inventories, net | 246,957 | 251,205 | ||||||
Uniforms and other rental items in service | 481,576 | 452,785 | ||||||
Income taxes, current | 15,331 | 22,188 | ||||||
Prepaid expenses and other | 24,778 | 24,704 | ||||||
Total current assets | 1,509,452 | 1,541,568 | ||||||
Property and equipment, at cost, net | 976,844 | 944,305 | ||||||
Goodwill | 1,519,987 | 1,485,375 | ||||||
Service contracts, net | 93,573 | 76,822 | ||||||
Other assets, net | 121,443 | 112,836 | ||||||
$ | 4,221,299 | $ | 4,160,906 | |||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 109,064 | $ | 94,840 | ||||
Accrued compensation and related liabilities | 90,533 | 91,214 | ||||||
Accrued liabilities | 238,462 | 256,642 | ||||||
Deferred tax liability | 62,019 | 2,559 | ||||||
Long-term debt due within one year | 674 | 225,636 | ||||||
Total current liabilities | 500,752 | 670,891 | ||||||
Long-term liabilities: | ||||||||
Long-term debt due after one year | 1,308,656 | 1,059,166 | ||||||
Deferred income taxes | 209,455 | 204,581 | ||||||
Accrued liabilities | 72,190 | 87,133 | ||||||
Total long-term liabilities | 1,590,301 | 1,350,880 | ||||||
Shareholders’ equity: | ||||||||
Preferred stock, no par value: 100,000 shares authorized, none outstanding | — | — | ||||||
Common stock, no par value: 425,000,000 shares authorized FY13: 174,570,683 issued and 122,723,896 outstanding FY12: 173,745,913 issued and 126,519,758 outstanding | 178,290 | 148,255 | ||||||
Paid-in capital | 103,666 | 107,019 | ||||||
Retained earnings | 3,631,793 | 3,482,073 | ||||||
Treasury stock: FY13: 51,846,787 shares FY12: 47,226,155 shares | (1,821,951 | ) | (1,634,875 | ) | ||||
Other accumulated comprehensive income (loss): | ||||||||
Foreign currency translation | 52,918 | 52,399 | ||||||
Unrealized loss on derivatives | (14,827 | ) | (16,104 | ) | ||||
Other | 357 | 368 | ||||||
Total shareholders’ equity | 2,130,246 | 2,139,135 | ||||||
$ | 4,221,299 | $ | 4,160,906 |
Nine Months Ended | ||||||||
February 28, 2013 | February 29, 2012 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 229,465 | $ | 219,023 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation | 123,242 | 115,566 | ||||||
Amortization of deferred charges | 17,884 | 29,520 | ||||||
Stock-based compensation | 16,660 | 15,023 | ||||||
Deferred income taxes | 63,799 | (995 | ) | |||||
Change in current assets and liabilities, net of acquisitions of businesses: | ||||||||
Accounts receivable, net | (41,402 | ) | (11,760 | ) | ||||
Inventories, net | 4,437 | (26,958 | ) | |||||
Uniforms and other rental items in service | (28,803 | ) | (40,435 | ) | ||||
Prepaid expenses and other | 9 | (5,977 | ) | |||||
Accounts payable | 13,475 | 6,372 | ||||||
Accrued compensation and related liabilities | (680 | ) | 3,251 | |||||
Accrued liabilities | (35,682 | ) | 9,327 | |||||
Income taxes payable | 5,939 | (4,243 | ) | |||||
Net cash provided by operating activities | 368,343 | 307,714 | ||||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (151,799 | ) | (117,716 | ) | ||||
Proceeds from redemption of marketable securities | 97,651 | 519,955 | ||||||
Purchase of marketable securities and investments | (135,398 | ) | (576,404 | ) | ||||
Acquisitions of businesses, net of cash acquired | (64,625 | ) | (20,882 | ) | ||||
Other, net | (662 | ) | 1,853 | |||||
Net cash used in investing activities | (254,833 | ) | (193,194 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from issuance of debt | 250,000 | — | ||||||
Repayment of debt | (225,472 | ) | (1,216 | ) | ||||
Proceeds from exercise of stock-based compensation awards | 7,156 | 356 | ||||||
Dividends paid | (79,744 | ) | (70,820 | ) | ||||
Repurchase of common stock | (187,076 | ) | (262,682 | ) | ||||
Other, net | (1,385 | ) | 1,390 | |||||
Net cash used in financing activities | (236,521 | ) | (332,972 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | 656 | (1,671 | ) | |||||
Net decrease in cash and cash equivalents | (122,355 | ) | (220,123 | ) | ||||
Cash and cash equivalents at beginning of period | 339,825 | 438,106 | ||||||
Cash and cash equivalents at end of period | $ | 217,470 | $ | 217,983 |