Discontinued Operations

9 Months Ended

Feb. 28, 2015

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

Effective August 31, 2014, Cintas' Storage business was classified as discontinued operations. The business was previously included in the Document Management Services operating segment. In accordance with the applicable accounting guidance for the disposal of long-lived assets, the results of the document imaging and document retention services business have been excluded from both continuing operations and segment results for all periods presented.

In the quarter ended November 30, 2014, Cintas sold the Storage business. The Storage business, excluding related real estate owned by Cintas, was sold in three separate transactions to three separate buyers. For the nine months ended February 28, 2015, cash proceeds received at the closing of each transaction total $154.9 million, net of cash contributed. During the three months ended February 28, 2015, Cintas received additional proceeds of $0.9 million in connection with the Storage transaction. Each transaction involves contingent consideration that the Company has an opportunity to receive if specified future events occur. Because of the uncertainty surrounding the future events, these amounts represent gain contingencies have not been recorded. Certain real estate owned by Cintas is being leased by the buyers. These lease payments do not represent a material direct cash flow of the disposed Storage business and therefore does not impact the classification of the Storage business as a discontinued operation.

Following is selected financial information included in net income from discontinued operations for the Storage business:

	Three Months Ended					Nine Months Ended
(In thousands)	February 28, 2015			February 28, 2014(1)		February 28, 2015			February 28, 2014(1)
Revenue	$	—		$	19,264	$	31,379		$	59,183
Income (loss) before income taxes	401			560		(4,302		)	1,778
Income tax (benefit) expense	(304		)	284		(2,098		)	740
Gain on sale of business	899			—		35,036			—
Income tax expense on gain	357			—		14,302			—
Net income from discontinued operations	$	1,247		$	276	$	18,530		$	1,038

⁽¹⁾ Results for the three and nine months endedFebruary 28, 2014 were previously presented in continuing operations.

Certain real estate assets and related liabilities were not included in the sale transactions, but opportunities for these assets are being evaluated; as such, these are classified as held for sale as of February 28, 2015. As allowed under applicable accounting guidance, the May 31, 2014 balance sheet amounts for these assets and liabilities remain in their natural classifications.