( X ) | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
( ) | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
WASHINGTON | 31-1188630 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) |
Class | Outstanding December 31, 2016 | |
Common Stock, no par value | 105,039,128 |
Part I. | Financial Information | Page No. | ||
Three and Six Months Ended November 30, 2016 and 2015 | ||||
Three and Six Months Ended November 30, 2016 and 2015 | ||||
November 30, 2016 and May 31, 2016 | ||||
Six Months Ended November 30, 2016 and 2015 | ||||
Item 5. | Other Information. | |||
Exhibits | ||||
Three Months Ended | Six Months Ended | ||||||||||||||
November 30, 2016 | November 30, 2015 | November 30, 2016 | November 30, 2015 | ||||||||||||
Revenue: | |||||||||||||||
Uniform rental and facility services | $ | 1,005,565 | $ | 937,704 | $ | 2,005,161 | $ | 1,876,112 | |||||||
Other | 291,358 | 281,376 | 585,892 | 541,858 | |||||||||||
1,296,923 | 1,219,080 | 2,591,053 | 2,417,970 | ||||||||||||
Costs and expenses: | |||||||||||||||
Cost of uniform rental and facility services | 555,752 | 526,091 | 1,096,684 | 1,044,594 | |||||||||||
Cost of other | 169,744 | 165,589 | 339,168 | 321,832 | |||||||||||
Selling and administrative expenses | 365,222 | 327,051 | 739,248 | 665,688 | |||||||||||
G&K Services, Inc. transaction expenses | 3,347 | — | 6,134 | — | |||||||||||
Operating income | 202,858 | 200,349 | 409,819 | 385,856 | |||||||||||
Interest income | (31 | ) | (111 | ) | (96 | ) | (230 | ) | |||||||
Interest expense | 13,267 | 16,171 | 27,439 | 32,583 | |||||||||||
Income before income taxes | 189,622 | 184,289 | 382,476 | 353,503 | |||||||||||
Income taxes | 66,168 | 68,836 | 120,931 | 131,852 | |||||||||||
Income from continuing operations | 123,454 | 115,453 | 261,545 | 221,651 | |||||||||||
Income from discontinued operations, net of tax expense of $8,953, $146,395, $8,953 and $142,976, respectively | 16,923 | 229,647 | 16,923 | 223,630 | |||||||||||
Net income | $ | 140,377 | $ | 345,100 | $ | 278,468 | $ | 445,281 | |||||||
Basic earnings per share: | |||||||||||||||
Continuing operations | $ | 1.16 | $ | 1.05 | $ | 2.45 | $ | 1.99 | |||||||
Discontinued operations | 0.16 | 2.06 | 0.16 | 2.01 | |||||||||||
Basic earnings per share | $ | 1.32 | $ | 3.11 | $ | 2.61 | $ | 4.00 | |||||||
Diluted earnings per share: | |||||||||||||||
Continuing operations | $ | 1.13 | $ | 1.03 | $ | 2.39 | $ | 1.96 | |||||||
Discontinued operations | 0.16 | 2.03 | 0.16 | 1.98 | |||||||||||
Diluted earnings per share | $ | 1.29 | $ | 3.06 | $ | 2.55 | $ | 3.94 | |||||||
Dividends declared per share | $ | 1.33 | $ | 1.05 | $ | 1.33 | $ | 1.05 |
Three Months Ended | Six Months Ended | ||||||||||||||
November 30, 2016 | November 30, 2015 | November 30, 2016 | November 30, 2015 | ||||||||||||
Net income | $ | 140,377 | $ | 345,100 | $ | 278,468 | $ | 445,281 | |||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||||
Foreign currency translation adjustments | (7,650 | ) | (4,626 | ) | (7,535 | ) | (16,639 | ) | |||||||
Cumulative translation adjustment on investment in Shred-it | — | 6,472 | — | 6,472 | |||||||||||
Change in fair value of derivatives | 26,390 | — | 14,353 | — | |||||||||||
Amortization of interest rate lock agreements | 385 | 488 | 770 | 976 | |||||||||||
Change in fair value of available-for-sale securities | 1 | (10 | ) | — | (18 | ) | |||||||||
Other comprehensive income (loss) | 19,126 | 2,324 | 7,588 | (9,209 | ) | ||||||||||
Comprehensive income | $ | 159,503 | $ | 347,424 | $ | 286,056 | $ | 436,072 |
November 30, 2016 | May 31, 2016 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 143,573 | $ | 139,357 | |||
Marketable securities | — | 70,405 | |||||
Accounts receivable, net | 607,452 | 563,178 | |||||
Inventories, net | 263,301 | 249,362 | |||||
Uniforms and other rental items in service | 543,644 | 539,956 | |||||
Income taxes, current | 1,228 | 1,712 | |||||
Prepaid expenses and other current assets | 41,464 | 26,065 | |||||
Total current assets | 1,600,662 | 1,590,035 | |||||
Property and equipment, at cost, net | 1,067,214 | 994,237 | |||||
Investments | 140,530 | 124,952 | |||||
Goodwill | 1,301,391 | 1,291,593 | |||||
Service contracts, net | 85,517 | 83,715 | |||||
Other assets, net | 19,265 | 14,283 | |||||
$ | 4,214,579 | $ | 4,098,815 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 127,815 | $ | 114,514 | |||
Accrued compensation and related liabilities | 85,857 | 101,976 | |||||
Accrued liabilities | 469,085 | 349,065 | |||||
Debt due within one year | 66,000 | 250,000 | |||||
Total current liabilities | 748,757 | 815,555 | |||||
Long-term liabilities: | |||||||
Debt due after one year | 1,044,834 | 1,044,422 | |||||
Deferred income taxes | 265,091 | 259,475 | |||||
Accrued liabilities | 130,192 | 136,704 | |||||
Total long-term liabilities | 1,440,117 | 1,440,601 | |||||
Shareholders’ equity: | |||||||
Preferred stock, no par value: | — | — | |||||
100,000 shares authorized, none outstanding | |||||||
Common stock, no par value: | 468,392 | 409,682 | |||||
425,000,000 shares authorized | |||||||
FY 2017: 180,589,260 issued and 105,009,742 outstanding | |||||||
FY 2016: 179,598,516 issued and 104,213,479 outstanding | |||||||
Paid-in capital | 178,668 | 205,260 | |||||
Retained earnings | 4,968,437 | 4,805,867 | |||||
Treasury stock: | (3,572,506 | ) | (3,553,276 | ) | |||
FY 2017: 75,579,518 shares | |||||||
FY 2016: 75,385,037 shares | |||||||
Accumulated other comprehensive loss | (17,286 | ) | (24,874 | ) | |||
Total shareholders’ equity | 2,025,705 | 1,842,659 | |||||
$ | 4,214,579 | $ | 4,098,815 |
Six Months Ended | |||||||
November 30, 2016 | November 30, 2015 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 278,468 | $ | 445,281 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation | 79,590 | 73,130 | |||||
Amortization of intangible assets | 7,460 | 7,764 | |||||
Stock-based compensation | 39,582 | 40,241 | |||||
Gain on Storage transactions | — | (15,786 | ) | ||||
Gain on Shred-it | (25,876 | ) | (349,738 | ) | |||
Deferred income taxes | (3,833 | ) | (98,423 | ) | |||
Change in current assets and liabilities, net of acquisitions of businesses: | |||||||
Accounts receivable, net | (44,920 | ) | (39,418 | ) | |||
Inventories, net | (14,616 | ) | (19,841 | ) | |||
Uniforms and other rental items in service | (4,315 | ) | (10,893 | ) | |||
Prepaid expenses and other current assets | (1,952 | ) | (2,369 | ) | |||
Accounts payable | 15,451 | 19,368 | |||||
Accrued compensation and related liabilities | (18,936 | ) | (22,771 | ) | |||
Accrued liabilities and other | (4,866 | ) | 1,041 | ||||
Income taxes, current | 484 | 237,451 | |||||
Net cash provided by operating activities | 301,721 | 265,037 | |||||
Cash flows from investing activities: | |||||||
Capital expenditures | (155,173 | ) | (121,817 | ) | |||
Proceeds from redemption of marketable securities | 172,968 | 212,081 | |||||
Purchase of marketable securities and investments | (118,270 | ) | (271,341 | ) | |||
Proceeds from Storage transactions | — | 35,338 | |||||
Proceeds from sale of investment in Shred-it | 25,876 | 578,257 | |||||
Acquisitions of businesses, net of cash acquired | (17,778 | ) | (121,237 | ) | |||
Other, net | 332 | 1,987 | |||||
Net cash (used in) provided by investing activities | (92,045 | ) | 313,268 | ||||
Cash flows from financing activities: | |||||||
Proceeds from issuance of commercial paper, net | 66,000 | — | |||||
Repayment of debt | (250,000 | ) | (16 | ) | |||
Prepaid short-term debt financing fees | (13,495 | ) | — | ||||
Proceeds from exercise of stock-based compensation awards | 19,225 | 17,444 | |||||
Repurchase of common stock | (19,230 | ) | (402,293 | ) | |||
Other, net | (5,572 | ) | 646 | ||||
Net cash used in financing activities | (203,072 | ) | (384,219 | ) | |||
Effect of exchange rate changes on cash and cash equivalents | (2,388 | ) | (4,374 | ) | |||
Net increase in cash and cash equivalents | 4,216 | 189,712 | |||||
Cash and cash equivalents at beginning of period | 139,357 | 417,073 | |||||
Cash and cash equivalents at end of period | $ | 143,573 | $ | 606,785 |
(In thousands) | November 30, 2016 | May 31, 2016 | |||||
Raw materials | $ | 11,303 | $ | 17,794 | |||
Work in process | 16,772 | 14,731 | |||||
Finished goods | 235,226 | 216,837 | |||||
$ | 263,301 | $ | 249,362 |
As of November 30, 2016 | |||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||
Cash and cash equivalents | $ | 143,573 | $ | — | $ | — | $ | 143,573 | |||||||
Other assets, net: | |||||||||||||||
Interest rate lock agreements | — | 3,264 | — | 3,264 | |||||||||||
Total assets at fair value | $ | 143,573 | $ | 3,264 | $ | — | $ | 146,837 |
As of May 31, 2016 | |||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Fair Value | |||||||||||
Cash and cash equivalents | $ | 139,357 | $ | — | $ | — | $ | 139,357 | |||||||
Marketable securities: | |||||||||||||||
Canadian treasury securities | — | 70,405 | — | 70,405 | |||||||||||
Total assets at fair value | $ | 139,357 | $ | 70,405 | $ | — | $ | 209,762 | |||||||
Long-term accrued liabilities: | |||||||||||||||
Interest rate lock agreements | $ | — | $ | 19,628 | $ | — | $ | 19,628 | |||||||
Total liabilities at fair value | $ | — | $ | 19,628 | $ | — | $ | 19,628 |
Three Months Ended | Six Months Ended | ||||||||||||||
(In thousands except per share data) | November 30, 2016 | November 30, 2015 | November 30, 2016 | November 30, 2015 | |||||||||||
Basic Earnings per Share from Continuing Operations | |||||||||||||||
Income from continuing operations | $ | 123,454 | $ | 115,453 | $ | 261,545 | $ | 221,651 | |||||||
Less: income from continuing operations allocated to participating securities | 2,228 | 1,887 | 4,955 | 3,629 | |||||||||||
Income from continuing operations available to common shareholders | $ | 121,226 | $ | 113,566 | $ | 256,590 | $ | 218,022 | |||||||
Basic weighted average common shares outstanding | 104,957 | 108,301 | 104,719 | 109,455 | |||||||||||
Basic earnings per share from continuing operations | $ | 1.16 | $ | 1.05 | $ | 2.45 | $ | 1.99 |
Three Months Ended | Six Months Ended | ||||||||||||||
(In thousands except per share data) | November 30, 2016 | November 30, 2015 | November 30, 2016 | November 30, 2015 | |||||||||||
Diluted Earnings per Share from Continuing Operations | |||||||||||||||
Income from continuing operations | $ | 123,454 | $ | 115,453 | $ | 261,545 | $ | 221,651 | |||||||
Less: income from continuing operations allocated to participating securities | 2,228 | 1,887 | 4,955 | 3,629 | |||||||||||
Income from continuing operations available to common shareholders | $ | 121,226 | $ | 113,566 | $ | 256,590 | $ | 218,022 | |||||||
Basic weighted average common shares outstanding | 104,957 | 108,301 | 104,719 | 109,455 | |||||||||||
Effect of dilutive securities – employee stock options | 2,690 | 1,812 | 2,559 | 1,685 | |||||||||||
Diluted weighted average common shares outstanding | 107,647 | 110,113 | 107,278 | 111,140 | |||||||||||
Diluted earnings per share from continuing operations | $ | 1.13 | $ | 1.03 | $ | 2.39 | $ | 1.96 |
Goodwill (in thousands) | Uniform Rental and Facility Services | First Aid and Safety Services | All Other | Total | |||||||||||
Balance as of June 1, 2016 | $ | 953,216 | $ | 241,448 | $ | 96,929 | $ | 1,291,593 | |||||||
Goodwill acquired | 5,704 | 1,871 | 3,227 | 10,802 | |||||||||||
Foreign currency translation | (482 | ) | (511 | ) | (11 | ) | (1,004 | ) | |||||||
Balance as of November 30, 2016 | $ | 958,438 | $ | 242,808 | $ | 100,145 | $ | 1,301,391 |
Service Contracts (in thousands) | Uniform Rental and Facility Services | First Aid and Safety Services | All Other | Total | |||||||||||
Balance as of June 1, 2016 | $ | 21,191 | $ | 32,252 | $ | 30,272 | $ | 83,715 | |||||||
Service contracts acquired | 3,514 | 1,612 | 3,236 | 8,362 | |||||||||||
Service contracts amortization | (1,647 | ) | (1,873 | ) | (2,965 | ) | (6,485 | ) | |||||||
Foreign currency translation | (48 | ) | (27 | ) | — | (75 | ) | ||||||||
Balance as of November 30, 2016 | $ | 23,010 | $ | 31,964 | $ | 30,543 | $ | 85,517 |
As of November 30, 2016 | |||||||||||
(In thousands) | Carrying Amount | Accumulated Amortization | Net | ||||||||
Service contracts | $ | 403,234 | $ | 317,717 | $ | 85,517 | |||||
Noncompete and consulting agreements | $ | 43,056 | $ | 41,132 | $ | 1,924 | |||||
Other | 20,266 | 2,925 | 17,341 | ||||||||
Total other assets | $ | 63,322 | $ | 44,057 | $ | 19,265 |
As of May 31, 2016 | |||||||||||
(In thousands) | Carrying Amount | Accumulated Amortization | Net | ||||||||
Service contracts | $ | 395,482 | $ | 311,767 | $ | 83,715 | |||||
Noncompete and consulting agreements | $ | 42,378 | $ | 40,928 | $ | 1,450 | |||||
Other | 15,275 | 2,442 | 12,833 | ||||||||
Total other assets | $ | 57,653 | $ | 43,370 | $ | 14,283 |
Assets: | |||
Cash and cash equivalents | $ | 333 | |
Accounts receivable | 16,705 | ||
Inventory | 5,987 | ||
Other current assets | 1,443 | ||
Property, plant and equipment | 849 | ||
Goodwill | 87,442 | ||
Service contracts | 34,000 | ||
Other intagibles | 4,500 | ||
Liabilities: | |||
Accounts payable | (7,195 | ) | |
Accrued liabilities | (4,428 | ) | |
Deferred income taxes | (5,636 | ) | |
Total consideration | $ | 134,000 |
(In thousands) | Foreign Currency | Unrealized Loss on Derivatives | Other | Total | |||||||||||
Balance at June 1, 2016 | $ | (2,474 | ) | $ | (20,830 | ) | $ | (1,570 | ) | $ | (24,874 | ) | |||
Other comprehensive income (loss) before reclassifications | 115 | (12,037 | ) | (1 | ) | (11,923 | ) | ||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | — | 385 | — | 385 | |||||||||||
Net current period other comprehensive income (loss) | 115 | (11,652 | ) | (1 | ) | (11,538 | ) | ||||||||
Balance at August 31, 2016 | (2,359 | ) | (32,482 | ) | (1,571 | ) | (36,412 | ) | |||||||
Other comprehensive (loss) income before reclassifications | (7,650 | ) | 26,390 | 1 | 18,741 | ||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | — | 385 | — | 385 | |||||||||||
Net current period other comprehensive (loss) income | (7,650 | ) | 26,775 | 1 | 19,126 | ||||||||||
Balance at November 30, 2016 | $ | (10,009 | ) | $ | (5,707 | ) | $ | (1,570 | ) | $ | (17,286 | ) |
(In thousands) | Foreign Currency | Unrealized Loss on Derivatives | Other | Total | |||||||||||
Balance at June 1, 2015 | $ | 2,987 | $ | (10,626 | ) | $ | (832 | ) | $ | (8,471 | ) | ||||
Other comprehensive loss before reclassifications | (12,013 | ) | — | (8 | ) | (12,021 | ) | ||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | — | 488 | — | 488 | |||||||||||
Net current period other comprehensive (loss) income | (12,013 | ) | 488 | (8 | ) | (11,533 | ) | ||||||||
Balance at August 31, 2015 | (9,026 | ) | (10,138 | ) | (840 | ) | (20,004 | ) | |||||||
Other comprehensive loss before reclassifications | (4,626 | ) | — | (10 | ) | (4,636 | ) | ||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 6,472 | 488 | — | 6,960 | |||||||||||
Net current period other comprehensive income (loss) | 1,846 | 488 | (10 | ) | 2,324 | ||||||||||
Balance at November 30, 2015 | $ | (7,180 | ) | $ | (9,650 | ) | $ | (850 | ) | $ | (17,680 | ) |
Reclassifications out of Accumulated Other Comprehensive Loss | ||||||||||||||||||
Details about Accumulated Other Comprehensive Loss Components | Amount Reclassified from Accumulated Other Comprehensive Loss | Affected Line in the Consolidated Condensed Statements of Income | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | November 30, 2016 | November 30, 2015 | ||||||||||||||
Amortization of interest rate locks | $ | (615 | ) | $ | (783 | ) | $ | (1,229 | ) | $ | (1,565 | ) | Interest expense | |||||
Tax benefit | 230 | 295 | 459 | 589 | Income taxes | |||||||||||||
Amortization of interest rate locks, net of tax | $ | (385 | ) | $ | (488 | ) | $ | (770 | ) | $ | (976 | ) | Net of tax | |||||
Three Months Ended | Six Months Ended | |||||||||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | November 30, 2016 | November 30, 2015 | ||||||||||||||
Cumulative translation adjustment on Shred-it | $ | — | $ | (10,381 | ) | $ | — | $ | (10,381 | ) | Income from discontinued operations | |||||||
Tax benefit | — | 3,909 | — | 3,909 | Income from discontinued operations | |||||||||||||
Cumulative translation adjustment on Shred-it, net of tax | $ | — | $ | (6,472 | ) | $ | — | $ | (6,472 | ) | Net of tax |
(In thousands) | Uniform Rental and Facility Services | First Aid and Safety Services | All Other | Corporate (1) | Total | ||||||||||||||
For the three months ended November 30, 2016 | |||||||||||||||||||
Revenue | $ | 1,005,565 | $ | 124,797 | $ | 166,561 | $ | — | $ | 1,296,923 | |||||||||
Income (loss) before income taxes | $ | 177,361 | $ | 14,779 | $ | 10,718 | $ | (13,236 | ) | $ | 189,622 | ||||||||
For the three months ended November 30, 2015 | |||||||||||||||||||
Revenue | $ | 937,704 | $ | 120,438 | $ | 160,938 | $ | — | $ | 1,219,080 | |||||||||
Income (loss) before income taxes | $ | 169,295 | $ | 14,847 | $ | 16,207 | $ | (16,060 | ) | $ | 184,289 | ||||||||
As of and for the six months ended November 30, 2016 | |||||||||||||||||||
Revenue | $ | 2,005,161 | $ | 249,636 | $ | 336,256 | $ | — | $ | 2,591,053 | |||||||||
Income (loss) before income taxes | $ | 362,606 | $ | 26,290 | $ | 20,923 | $ | (27,343 | ) | $ | 382,476 | ||||||||
Total assets | $ | 3,266,422 | $ | 443,151 | $ | 361,433 | $ | 143,573 | $ | 4,214,579 | |||||||||
As of and for the six months ended November 30, 2015 | |||||||||||||||||||
Revenue | $ | 1,876,112 | $ | 219,926 | $ | 321,932 | $ | — | $ | 2,417,970 | |||||||||
Income (loss) before income taxes | $ | 334,676 | $ | 23,439 | $ | 27,741 | $ | (32,353 | ) | $ | 353,503 | ||||||||
Total assets | $ | 2,990,828 | $ | 426,089 | $ | 355,082 | $ | 672,611 | $ | 4,444,610 |
Three Months Ended | Six Months Ended | ||||||||||||||
(In thousands) | November 30, 2016 | November 30, 2015 | November 30, 2016 | November 30, 2015 | |||||||||||
Revenue | $ | — | $ | — | $ | — | $ | — | |||||||
Income before income taxes | — | 845 | — | 1,082 | |||||||||||
Gain on Storage transactions | — | 10,943 | — | 15,786 | |||||||||||
Gain on Shred-it | 25,876 | 364,254 | 25,876 | 349,738 | |||||||||||
Income tax expense on net gain | (8,953 | ) | (146,395 | ) | (8,953 | ) | (142,976 | ) | |||||||
Net income from discontinued operations | $ | 16,923 | $ | 229,647 | $ | 16,923 | $ | 223,630 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Revenue: | |||||||||||||||||||||||
Uniform rental and facility services | $ | — | $ | 841,442 | $ | 149,886 | $ | 57,610 | $ | (43,373 | ) | $ | 1,005,565 | ||||||||||
Other | — | 411,378 | 633 | 18,162 | (138,815 | ) | 291,358 | ||||||||||||||||
Equity in net income of affiliates | 140,377 | — | — | — | (140,377 | ) | — | ||||||||||||||||
140,377 | 1,252,820 | 150,519 | 75,772 | (322,565 | ) | 1,296,923 | |||||||||||||||||
Costs and expenses (income): | |||||||||||||||||||||||
Cost of uniform rental and facility services | — | 487,653 | 94,323 | 37,603 | (63,827 | ) | 555,752 | ||||||||||||||||
Cost of other | — | 287,368 | (19,549 | ) | 13,636 | (111,711 | ) | 169,744 | |||||||||||||||
Selling and administrative expenses | — | 401,715 | (48,256 | ) | 18,703 | (6,940 | ) | 365,222 | |||||||||||||||
G&K Services, Inc. transaction expenses | — | — | 3,347 | — | — | 3,347 | |||||||||||||||||
Operating income | 140,377 | 76,084 | 120,654 | 5,830 | (140,087 | ) | 202,858 | ||||||||||||||||
Interest income | — | — | (7 | ) | (25 | ) | 1 | (31 | ) | ||||||||||||||
Interest expense (income) | — | 14,528 | (1,176 | ) | (85 | ) | — | 13,267 | |||||||||||||||
Income before income taxes | 140,377 | 61,556 | 121,837 | 5,940 | (140,088 | ) | 189,622 | ||||||||||||||||
Income taxes | — | 21,534 | 42,652 | 2,011 | (29 | ) | 66,168 | ||||||||||||||||
Income from continuing operations | 140,377 | 40,022 | 79,185 | 3,929 | (140,059 | ) | 123,454 | ||||||||||||||||
Income from discontinued operations, net of tax | — | 14,982 | — | 1,941 | — | 16,923 | |||||||||||||||||
Net income from continuing operations | $ | 140,377 | $ | 55,004 | $ | 79,185 | $ | 5,870 | $ | (140,059 | ) | $ | 140,377 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Revenue: | |||||||||||||||||||||||
Uniform rental and facility services | $ | — | $ | 786,386 | $ | 136,707 | $ | 53,674 | $ | (39,063 | ) | $ | 937,704 | ||||||||||
Other | — | 394,260 | 737 | 17,516 | (131,137 | ) | 281,376 | ||||||||||||||||
Equity in net income of affiliates | 115,453 | — | — | — | (115,453 | ) | — | ||||||||||||||||
115,453 | 1,180,646 | 137,444 | 71,190 | (285,653 | ) | 1,219,080 | |||||||||||||||||
Costs and expenses (income): | |||||||||||||||||||||||
Cost of uniform rental and facility services | — | 461,843 | 86,702 | 35,935 | (58,389 | ) | 526,091 | ||||||||||||||||
Cost of other | — | 277,841 | (18,291 | ) | 12,317 | (106,278 | ) | 165,589 | |||||||||||||||
Selling and administrative expenses | — | 365,125 | (49,482 | ) | 16,140 | (4,732 | ) | 327,051 | |||||||||||||||
Operating income | 115,453 | 75,837 | 118,515 | 6,798 | (116,254 | ) | 200,349 | ||||||||||||||||
Interest income | — | (12 | ) | (68 | ) | (31 | ) | — | (111 | ) | |||||||||||||
Interest expense (income) | — | 16,427 | (256 | ) | — | — | 16,171 | ||||||||||||||||
Income before income taxes | 115,453 | 59,422 | 118,839 | 6,829 | (116,254 | ) | 184,289 | ||||||||||||||||
Income taxes | — | 20,496 | 42,108 | 6,260 | (28 | ) | 68,836 | ||||||||||||||||
Income from continuing operations | 115,453 | 38,926 | 76,731 | 569 | (116,226 | ) | 115,453 | ||||||||||||||||
Income (loss) from discontinued operations, net of tax | 229,647 | 234,604 | — | (4,957 | ) | (229,647 | ) | 229,647 | |||||||||||||||
Net income (loss) | $ | 345,100 | $ | 273,530 | $ | 76,731 | $ | (4,388 | ) | $ | (345,873 | ) | $ | 345,100 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Revenue: | |||||||||||||||||||||||
Uniform rental and facility services | $ | — | $ | 1,678,716 | $ | 299,034 | $ | 115,273 | $ | (87,862 | ) | $ | 2,005,161 | ||||||||||
Other | — | 821,626 | 1,601 | 37,037 | (274,372 | ) | 585,892 | ||||||||||||||||
Equity in net income of affiliates | 278,468 | — | — | — | (278,468 | ) | — | ||||||||||||||||
278,468 | 2,500,342 | 300,635 | 152,310 | (640,702 | ) | 2,591,053 | |||||||||||||||||
Costs and expenses (income): | |||||||||||||||||||||||
Cost of uniform rental and facility services | — | 966,709 | 184,995 | 74,717 | (129,737 | ) | 1,096,684 | ||||||||||||||||
Cost of other | — | 567,392 | (34,480 | ) | 27,464 | (221,208 | ) | 339,168 | |||||||||||||||
Selling and administrative expenses | — | 813,649 | (98,990 | ) | 38,968 | (14,379 | ) | 739,248 | |||||||||||||||
G&K Services Inc. transaction expenses | — | — | 6,134 | — | — | 6,134 | |||||||||||||||||
Operating income | 278,468 | 152,592 | 242,976 | 11,161 | (275,378 | ) | 409,819 | ||||||||||||||||
Interest income | — | — | (24 | ) | (73 | ) | 1 | (96 | ) | ||||||||||||||
Interest expense (income) | — | 29,355 | (1,878 | ) | (38 | ) | — | 27,439 | |||||||||||||||
Income before income taxes | 278,468 | 123,237 | 244,878 | 11,272 | (275,379 | ) | 382,476 | ||||||||||||||||
Income taxes | — | 39,344 | 78,178 | 3,464 | (55 | ) | 120,931 | ||||||||||||||||
Income from continuing operations | 278,468 | 83,893 | 166,700 | 7,808 | (275,324 | ) | 261,545 | ||||||||||||||||
Income from discontinued operations, net of tax | — | 14,982 | — | 1,941 | — | 16,923 | |||||||||||||||||
Net income | $ | 278,468 | $ | 98,875 | $ | 166,700 | $ | 9,749 | $ | (275,324 | ) | $ | 278,468 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Revenue: | |||||||||||||||||||||||
Uniform rental and facility services | $ | — | $ | 1,573,555 | $ | 273,132 | $ | 107,686 | $ | (78,261 | ) | $ | 1,876,112 | ||||||||||
Other | — | 766,871 | 2,030 | 32,327 | (259,370 | ) | 541,858 | ||||||||||||||||
Equity in net income of affiliates | 221,651 | — | — | — | (221,651 | ) | — | ||||||||||||||||
221,651 | 2,340,426 | 275,162 | 140,013 | (559,282 | ) | 2,417,970 | |||||||||||||||||
Costs and expenses (income): | |||||||||||||||||||||||
Cost of uniform rental and facility services | — | 917,050 | 172,900 | 71,755 | (117,111 | ) | 1,044,594 | ||||||||||||||||
Cost of other | — | 536,831 | (32,547 | ) | 23,423 | (205,875 | ) | 321,832 | |||||||||||||||
Selling and administrative expenses | — | 734,818 | (90,954 | ) | 34,020 | (12,196 | ) | 665,688 | |||||||||||||||
Operating income | 221,651 | 151,727 | 225,763 | 10,815 | (224,100 | ) | 385,856 | ||||||||||||||||
Interest income | — | (12 | ) | (116 | ) | (102 | ) | — | (230 | ) | |||||||||||||
Interest expense (income) | — | 32,802 | (218 | ) | (1 | ) | — | 32,583 | |||||||||||||||
Income before income taxes | 221,651 | 118,937 | 226,097 | 10,918 | (224,100 | ) | 353,503 | ||||||||||||||||
Income taxes | — | 42,878 | 81,511 | 7,516 | (53 | ) | 131,852 | ||||||||||||||||
Income from continuing operations | 221,651 | 76,059 | 144,586 | 3,402 | (224,047 | ) | 221,651 | ||||||||||||||||
Income (loss) from discontinued operations, net of tax | 223,630 | 229,281 | — | (5,651 | ) | (223,630 | ) | 223,630 | |||||||||||||||
Net income (loss) | $ | 445,281 | $ | 305,340 | $ | 144,586 | $ | (2,249 | ) | $ | (447,677 | ) | $ | 445,281 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Net income | $ | 140,377 | $ | 55,004 | $ | 79,185 | $ | 5,870 | $ | (140,059 | ) | $ | 140,377 | ||||||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||||||||||||
Foreign currency translation adjustments | (7,650 | ) | — | — | (7,650 | ) | 7,650 | (7,650 | ) | ||||||||||||||
Change in fair value of derivatives | 26,390 | 26,390 | — | — | (26,390 | ) | 26,390 | ||||||||||||||||
Amortization of interest rate lock agreements | 385 | 385 | — | — | (385 | ) | 385 | ||||||||||||||||
Change in fair value of available-for-sale securities | 1 | — | — | 1 | (1 | ) | 1 | ||||||||||||||||
Other comprehensive income (loss) | 19,126 | 26,775 | — | (7,649 | ) | (19,126 | ) | 19,126 | |||||||||||||||
Comprehensive income (loss) | $ | 159,503 | $ | 81,779 | $ | 79,185 | $ | (1,779 | ) | $ | (159,185 | ) | $ | 159,503 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Net income (loss) | $ | 345,100 | $ | 273,530 | $ | 76,731 | $ | (4,388 | ) | $ | (345,873 | ) | $ | 345,100 | |||||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | (4,626 | ) | — | (4,626 | ) | |||||||||||||||
Cumulative translation adjustment on Shred-it | — | 5,875 | — | 597 | — | 6,472 | |||||||||||||||||
Amortization of interest rate lock agreements | — | 488 | — | — | — | 488 | |||||||||||||||||
Change in fair value of available-for-sale securities | — | — | — | (10 | ) | — | (10 | ) | |||||||||||||||
Other comprehensive income (loss) | — | 6,363 | — | (4,039 | ) | — | 2,324 | ||||||||||||||||
Comprehensive income (loss) | $ | 345,100 | $ | 279,893 | $ | 76,731 | $ | (8,427 | ) | $ | (345,873 | ) | $ | 347,424 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Net income | $ | 278,468 | $ | 98,875 | $ | 166,700 | $ | 9,749 | $ | (275,324 | ) | $ | 278,468 | ||||||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||||||||||||
Foreign currency translation adjustments | (7,535 | ) | — | — | (7,535 | ) | 7,535 | (7,535 | ) | ||||||||||||||
Change in fair value of derivatives | 14,353 | 14,353 | — | — | (14,353 | ) | 14,353 | ||||||||||||||||
Amortization of interest rate lock agreements | 770 | 770 | — | — | (770 | ) | 770 | ||||||||||||||||
Other comprehensive income (loss) | 7,588 | 15,123 | — | (7,535 | ) | (7,588 | ) | 7,588 | |||||||||||||||
Comprehensive income | $ | 286,056 | $ | 113,998 | $ | 166,700 | $ | 2,214 | $ | (282,912 | ) | $ | 286,056 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Net income (loss) | $ | 445,281 | $ | 305,340 | $ | 144,586 | $ | (2,249 | ) | $ | (447,677 | ) | $ | 445,281 | |||||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | (16,639 | ) | — | (16,639 | ) | |||||||||||||||
Cumulative translation adjustment on Shred-it | — | 5,875 | — | 597 | — | 6,472 | |||||||||||||||||
Amortization of interest rate lock agreements | — | 976 | — | — | — | 976 | |||||||||||||||||
Change in fair value of available-for-sale securities | — | — | — | (18 | ) | — | (18 | ) | |||||||||||||||
Other comprehensive income (loss) | — | 6,851 | — | (16,060 | ) | — | (9,209 | ) | |||||||||||||||
Comprehensive income (loss) | $ | 445,281 | $ | 312,191 | $ | 144,586 | $ | (18,309 | ) | $ | (447,677 | ) | $ | 436,072 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Assets | |||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||
Cash and cash equivalents | $ | — | $ | 46,561 | $ | 2,425 | $ | 94,587 | $ | — | $ | 143,573 | |||||||||||
Accounts receivable, net | — | 467,396 | 104,330 | 35,726 | — | 607,452 | |||||||||||||||||
Inventories, net | — | 236,904 | 16,280 | 12,106 | (1,989 | ) | 263,301 | ||||||||||||||||
Uniforms and other rental items in service | — | 449,311 | 77,183 | 35,474 | (18,324 | ) | 543,644 | ||||||||||||||||
Income taxes, current | — | — | 1,233 | (5 | ) | — | 1,228 | ||||||||||||||||
Prepaid expenses and other current assets | — | 19,907 | 20,692 | 865 | — | 41,464 | |||||||||||||||||
Total current assets | — | 1,220,079 | 222,143 | 178,753 | (20,313 | ) | 1,600,662 | ||||||||||||||||
Property and equipment, at cost, net | — | 647,509 | 344,036 | 75,669 | — | 1,067,214 | |||||||||||||||||
Investments | 321,083 | 1,774,863 | 916,723 | 955,196 | (3,827,335 | ) | 140,530 | ||||||||||||||||
Goodwill | — | — | 1,261,755 | 39,748 | (112 | ) | 1,301,391 | ||||||||||||||||
Service contracts, net | — | 79,583 | 5 | 5,929 | — | 85,517 | |||||||||||||||||
Other assets, net | 1,381,960 | 4,209 | 3,402,717 | 8,949 | (4,778,570 | ) | 19,265 | ||||||||||||||||
$ | 1,703,043 | $ | 3,726,243 | $ | 6,147,379 | $ | 1,264,244 | $ | (8,626,330 | ) | $ | 4,214,579 | |||||||||||
Liabilities and Shareholders’ Equity | |||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||
Accounts payable | $ | (465,247 | ) | $ | (1,759,953 | ) | $ | 2,297,808 | $ | 17,092 | $ | 38,115 | $ | 127,815 | |||||||||
Accrued compensation and related liabilities | 2,819 | 60,811 | 16,936 | 5,291 | — | 85,857 | |||||||||||||||||
Accrued liabilities | 139,766 | 80,290 | 234,689 | 14,340 | — | 469,085 | |||||||||||||||||
Debt due within one year | — | 66,000 | — | — | — | 66,000 | |||||||||||||||||
Total current liabilities | (322,662 | ) | (1,552,852 | ) | 2,549,433 | 36,723 | 38,115 | 748,757 | |||||||||||||||
Long-term liabilities: | |||||||||||||||||||||||
Debt due after one year | — | 1,044,444 | — | 390 | — | 1,044,834 | |||||||||||||||||
Deferred income taxes | — | (416 | ) | 257,554 | 7,953 | — | 265,091 | ||||||||||||||||
Accrued liabilities | — | — | 129,042 | 1,150 | — | 130,192 | |||||||||||||||||
Total long-term liabilities | — | 1,044,028 | 386,596 | 9,493 | — | 1,440,117 | |||||||||||||||||
Total shareholders’ equity | 2,025,705 | 4,235,067 | 3,211,350 | 1,218,028 | (8,664,445 | ) | 2,025,705 | ||||||||||||||||
$ | 1,703,043 | $ | 3,726,243 | $ | 6,147,379 | $ | 1,264,244 | $ | (8,626,330 | ) | $ | 4,214,579 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Assets | |||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||
Cash and cash equivalents | $ | — | $ | 57,893 | $ | 55,392 | $ | 26,072 | $ | — | $ | 139,357 | |||||||||||
Marketable securities | — | — | — | 70,405 | — | 70,405 | |||||||||||||||||
Accounts receivable, net | — | 430,335 | 97,516 | 35,327 | — | 563,178 | |||||||||||||||||
Inventories, net | — | 222,823 | 19,149 | 11,235 | (3,845 | ) | 249,362 | ||||||||||||||||
Uniforms and other rental items in service | — | 450,065 | 73,001 | 36,612 | (19,722 | ) | 539,956 | ||||||||||||||||
Income taxes, current | — | (1,634 | ) | 2,698 | 648 | — | 1,712 | ||||||||||||||||
Prepaid expenses and other current assets | — | 6,824 | 18,279 | 962 | — | 26,065 | |||||||||||||||||
Total current assets | — | 1,166,306 | 266,035 | 181,261 | (23,567 | ) | 1,590,035 | ||||||||||||||||
Property and equipment, at cost, net | — | 614,656 | 305,636 | 73,945 | — | 994,237 | |||||||||||||||||
Investments | 321,083 | 1,770,303 | 901,772 | 941,396 | (3,809,602 | ) | 124,952 | ||||||||||||||||
Goodwill | — | — | 1,256,662 | 35,043 | (112 | ) | 1,291,593 | ||||||||||||||||
Service contracts, net | — | 81,462 | 13 | 2,240 | — | 83,715 | |||||||||||||||||
Other assets, net | 1,081,203 | (913 | ) | 3,526,051 | 9,110 | (4,601,168 | ) | 14,283 | |||||||||||||||
$ | 1,402,286 | $ | 3,631,814 | $ | 6,256,169 | $ | 1,242,995 | $ | (8,434,449 | ) | $ | 4,098,815 | |||||||||||
Liabilities and Shareholders’ Equity | |||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||
Accounts payable | $ | (465,247 | ) | $ | (1,773,815 | ) | $ | 2,298,790 | $ | 16,781 | $ | 38,005 | $ | 114,514 | |||||||||
Accrued compensation and related liabilities | — | 73,545 | 23,051 | 5,380 | — | 101,976 | |||||||||||||||||
Accrued liabilities | — | 84,270 | 251,217 | 13,578 | — | 349,065 | |||||||||||||||||
Debt due within one year | — | 250,000 | — | — | — | 250,000 | |||||||||||||||||
Total current liabilities | (465,247 | ) | (1,366,000 | ) | 2,573,058 | 35,739 | 38,005 | 815,555 | |||||||||||||||
Long-term liabilities: | |||||||||||||||||||||||
Debt due after one year | — | 1,044,032 | — | 390 | — | 1,044,422 | |||||||||||||||||
Deferred income taxes | — | (427 | ) | 252,149 | 7,753 | — | 259,475 | ||||||||||||||||
Accrued liabilities | — | 19,628 | 116,091 | 985 | — | 136,704 | |||||||||||||||||
Total long-term liabilities | — | 1,063,233 | 368,240 | 9,128 | — | 1,440,601 | |||||||||||||||||
Total shareholders’ equity | 1,867,533 | 3,934,581 | 3,314,871 | 1,198,128 | (8,472,454 | ) | 1,842,659 | ||||||||||||||||
$ | 1,402,286 | $ | 3,631,814 | $ | 6,256,169 | $ | 1,242,995 | $ | (8,434,449 | ) | $ | 4,098,815 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||||||
Net income | $ | 278,468 | $ | 98,875 | $ | 166,700 | $ | 9,749 | $ | (275,324 | ) | $ | 278,468 | ||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities | |||||||||||||||||||||||
Depreciation | — | 52,259 | 22,412 | 4,919 | — | 79,590 | |||||||||||||||||
Amortization of intangible assets | — | 6,847 | 175 | 438 | — | 7,460 | |||||||||||||||||
Stock-based compensation | 39,582 | — | — | — | — | 39,582 | |||||||||||||||||
Gain on Shred-it | — | (23,935 | ) | — | (1,941 | ) | — | (25,876 | ) | ||||||||||||||
Deferred income taxes | — | (9,578 | ) | 5,395 | 350 | — | (3,833 | ) | |||||||||||||||
Changes in current assets and liabilities, net of acquisitions of businesses: | |||||||||||||||||||||||
Accounts receivable, net | — | (36,939 | ) | (6,813 | ) | (1,168 | ) | — | (44,920 | ) | |||||||||||||
Inventories, net | — | (14,038 | ) | 2,871 | (1,593 | ) | (1,856 | ) | (14,616 | ) | |||||||||||||
Uniforms and other rental items in service | — | 754 | (4,182 | ) | 511 | (1,398 | ) | (4,315 | ) | ||||||||||||||
Prepaid expenses and other current assets | — | 412 | (2,411 | ) | 47 | — | (1,952 | ) | |||||||||||||||
Accounts payable | — | 23,367 | (10,857 | ) | 2,831 | 110 | 15,451 | ||||||||||||||||
Accrued compensation and related liabilities | 2,819 | (12,734 | ) | (8,935 | ) | (86 | ) | — | (18,936 | ) | |||||||||||||
Accrued liabilities and other | 139,766 | 3,711 | (148,384 | ) | 41 | — | (4,866 | ) | |||||||||||||||
Income taxes, current | — | (1,635 | ) | 1,460 | 659 | — | 484 | ||||||||||||||||
Net cash provided by operating activities | 460,635 | 87,366 | 17,431 | 14,757 | (278,468 | ) | 301,721 | ||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||
Capital expenditures | — | (85,207 | ) | (60,837 | ) | (9,129 | ) | — | (155,173 | ) | |||||||||||||
Proceeds from redemption of marketable securities | — | — | — | 172,968 | — | 172,968 | |||||||||||||||||
Purchase of marketable securities and investments | — | (4,560 | ) | (28,751 | ) | (102,692 | ) | 17,733 | (118,270 | ) | |||||||||||||
Proceeds from sale of investment in Shred-it | — | 23,935 | — | 1,941 | — | 25,876 | |||||||||||||||||
Acquisitions of businesses, net of cash acquired | — | (7,245 | ) | — | (10,533 | ) | — | (17,778 | ) | ||||||||||||||
Other, net | (460,630 | ) | 177,446 | 21,190 | 1,591 | 260,735 | 332 | ||||||||||||||||
Net cash (used in) provided by investing activities | (460,630 | ) | 104,369 | (68,398 | ) | 54,146 | 278,468 | (92,045 | ) | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||
Proceeds from issuance of commercial paper, net | — | 66,000 | — | — | — | 66,000 | |||||||||||||||||
Proceeds from issuance of debt | — | — | (2,000 | ) | 2,000 | — | — | ||||||||||||||||
Repayment of debt | — | (250,000 | ) | — | — | — | (250,000 | ) | |||||||||||||||
Prepaid short-term debt financing fees | — | (13,495 | ) | — | — | — | (13,495 | ) | |||||||||||||||
Proceeds from exercise of stock-based compensation awards | 19,225 | — | — | — | — | 19,225 | |||||||||||||||||
Repurchase of common stock | (19,230 | ) | — | — | — | — | (19,230 | ) | |||||||||||||||
Other, net | — | (5,572 | ) | — | — | — | (5,572 | ) | |||||||||||||||
Net cash (used in) provided by financing activities | (5 | ) | (203,067 | ) | (2,000 | ) | 2,000 | — | (203,072 | ) | |||||||||||||
Effect of exchange rate changes on cash and cash equivalents | — | — | — | (2,388 | ) | — | (2,388 | ) | |||||||||||||||
Net (decrease) increase in cash and cash equivalents | — | (11,332 | ) | (52,967 | ) | 68,515 | — | 4,216 | |||||||||||||||
Cash and cash equivalents at beginning of period | — | 57,893 | 55,392 | 26,072 | — | 139,357 | |||||||||||||||||
Cash and cash equivalents at end of period | $ | — | $ | 46,561 | $ | 2,425 | $ | 94,587 | $ | — | $ | 143,573 |
Cintas Corporation | Corp. 2 | Subsidiary Guarantors | Non- Guarantors | Eliminations | Cintas Corporation Consolidated | ||||||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||||||
Net income (loss) | $ | 445,281 | $ | 305,340 | $ | 144,586 | $ | (2,249 | ) | $ | (447,677 | ) | $ | 445,281 | |||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities | |||||||||||||||||||||||
Depreciation | — | 46,231 | 22,231 | 4,668 | — | 73,130 | |||||||||||||||||
Amortization of intangible assets | — | 7,248 | 337 | 179 | — | 7,764 | |||||||||||||||||
Stock-based compensation | 40,241 | — | — | — | — | 40,241 | |||||||||||||||||
Gain on Storage transactions | — | (12,547 | ) | — | (3,239 | ) | — | (15,786 | ) | ||||||||||||||
(Gain) loss on Shred-it | — | (362,237 | ) | — | 12,499 | — | (349,738 | ) | |||||||||||||||
Deferred income taxes | — | (93,097 | ) | (6,913 | ) | 1,587 | — | (98,423 | ) | ||||||||||||||
Changes in current assets and liabilities, net of acquisitions of businesses: | |||||||||||||||||||||||
Accounts receivable, net | — | (24,824 | ) | (13,014 | ) | (1,580 | ) | — | (39,418 | ) | |||||||||||||
Inventories, net | — | (20,021 | ) | (2,049 | ) | (365 | ) | 2,594 | (19,841 | ) | |||||||||||||
Uniforms and other rental items in service | — | (6,851 | ) | (2,319 | ) | (1,530 | ) | (193 | ) | (10,893 | ) | ||||||||||||
Prepaid expenses and other current assets | — | 128 | (2,534 | ) | 37 | — | (2,369 | ) | |||||||||||||||
Accounts payable | — | (388,996 | ) | 403,502 | 4,872 | (10 | ) | 19,368 | |||||||||||||||
Accrued compensation and related liabilities | — | (18,569 | ) | (3,520 | ) | (682 | ) | — | (22,771 | ) | |||||||||||||
Accrued liabilities and other | — | 685 | 976 | (1,344 | ) | 724 | 1,041 | ||||||||||||||||
Income taxes, current | — | 231,042 | 6,309 | 100 | — | 237,451 | |||||||||||||||||
Net cash provided by (used in) operating activities | 485,522 | (336,468 | ) | 547,592 | 12,953 | (444,562 | ) | 265,037 | |||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||
Capital expenditures | — | (67,463 | ) | (47,537 | ) | (6,817 | ) | — | (121,817 | ) | |||||||||||||
Proceeds from redemption of marketable securities | — | — | — | 212,081 | — | 212,081 | |||||||||||||||||
Purchase of marketable securities and investments | — | (3,437 | ) | (7,549 | ) | (264,365 | ) | 4,010 | (271,341 | ) | |||||||||||||
Proceeds from Storage transactions, net of cash acquired | — | 32,099 | — | 3,239 | — | 35,338 | |||||||||||||||||
Proceeds from sale of Shred-it | — | 565,643 | — | 12,614 | — | 578,257 | |||||||||||||||||
Acquisitions of businesses, net of cash acquired | — | (96,465 | ) | — | (24,772 | ) | — | (121,237 | ) | ||||||||||||||
Other, net | (100,673 | ) | (60,133 | ) | (278,564 | ) | 81 | 441,276 | 1,987 | ||||||||||||||
Net cash (used in) provided by investing activities | (100,673 | ) | 370,244 | (333,650 | ) | (67,939 | ) | 445,286 | 313,268 | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||
Proceeds from issuance of debt | — | — | (55 | ) | 55 | — | — | ||||||||||||||||
Repayment of debt | — | (309 | ) | 1,053 | (36 | ) | (724 | ) | (16 | ) | |||||||||||||
Exercise of stock-based compensation awards | 17,444 | — | — | — | — | 17,444 | |||||||||||||||||
Repurchase of common stock | (402,293 | ) | — | — | — | — | (402,293 | ) | |||||||||||||||
Other, net | — | 976 | — | (330 | ) | — | 646 | ||||||||||||||||
Net cash (used in) provided by financing activities | (384,849 | ) | 667 | 998 | (311 | ) | (724 | ) | (384,219 | ) | |||||||||||||
Effect of exchange rate changes on cash and cash equivalents | — | — | — | (4,374 | ) | — | (4,374 | ) | |||||||||||||||
Net increase (decrease) in cash and cash equivalents | — | 34,443 | 214,940 | (59,671 | ) | — | 189,712 | ||||||||||||||||
Cash and cash equivalents at beginning of period | — | 74,632 | 248,716 | 93,725 | — | 417,073 | |||||||||||||||||
Cash and cash equivalents at end of period | $ | — | $ | 109,075 | $ | 463,656 | $ | 34,054 | $ | — | $ | 606,785 |
(In thousands) | 2016 | 2015 | |||||
Net cash provided by operating activities | $ | 301,721 | $ | 265,037 | |||
Net cash (used in) provided by investing activities | $ | (92,045 | ) | $ | 313,268 | ||
Net cash used in financing activities | $ | (203,072 | ) | $ | (384,219 | ) | |
Cash and cash equivalents at the end of the period | $ | 143,573 | $ | 606,785 | |||
Marketable securities at the end of the period | $ | — | $ | 65,826 |
Rating Agency | Outlook | Commercial Paper | Long-term Debt | |||
Standard & Poor’s | Stable | A-2 | BBB+ | |||
Moody’s Investors Service | Under Review * | P-1 | A2 |
Period (In millions, except share and per share data) | Total number of shares purchased | Average price paid per share | Total number of shares purchased as part of the publicly announced plan (1) | Maximum approximate dollar value of shares that may yet be purchased under the plan (1) | |||||||||
September 1 - 30, 2016 | — | $ | — | — | $ | 500.0 | |||||||
October 1 - 31, 2016 (2) | 1,122 | $ | 106.73 | — | $ | 500.0 | |||||||
November 1 - 30, 2016(3) | 1,618 | $ | 115.58 | — | $ | 500.0 | |||||||
Total | 2,740 | $ | 111.96 | — | $ | 500.0 |
10.1 | Amended and Restated Credit Agreement, dated as of September 16, 2016, among Cintas Corp. No. 2, the Lenders party thereto and KeyBank National Association, as Administrative Agent (Incorporated by reference to Cintas' Current Report on Form 8-K dated September 22, 2016). |
10.2 | Cintas Corporation 2016 Equity and Incentive Compensation Plan (Incorporated by reference to Cintas' Current Report on Form 8-K dated October 20, 2016). |
31.1 | Certification of Principal Executive Officer required by Rule 13a-14(a) |
31.2 | Certification of Principal Financial Officer required by Rule 13a-14(a) |
32.1 | Section 1350 Certification of Chief Executive Officer |
32.2 | Section 1350 Certification of Chief Financial Officer |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema Document |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
CINTAS CORPORATION | ||||||
(Registrant) | ||||||
Date: | January 6, 2017 | /s/ | J. Michael Hansen | |||
J. Michael Hansen | ||||||
Senior Vice President and Chief Financial Officer | ||||||
(Principal Financial and Accounting Officer) |
10.1 | Amended and Restated Credit Agreement, dated as of September 16, 2016, among Cintas Corp. No. 2, the Lenders party thereto and KeyBank National Association, as Administrative Agent (Incorporated by reference to Cintas' Current Report on Form 8-K dated September 22, 2016). |
10.2 | Cintas Corporation 2016 Equity and Incentive Compensation Plan (Incorporated by reference to Cintas' Current Report on Form 8-K dated October 20, 2016). |
31.1 | Certification of Principal Executive Officer required by Rule 13a-14(a) |
31.2 | Certification of Principal Financial Officer required by Rule 13a-14(a) |
32.1 | Section 1350 Certification of Chief Executive Officer |
32.2 | Section 1350 Certification of Chief Financial Officer |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema Document |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
1. | I have reviewed this quarterly report on Form 10-Q of Cintas Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have: |
Date: | January 6, 2017 | /s/ Scott D. Farmer | |
Scott D. Farmer | |||
Chairman and Chief Executive Officer | |||
(Principal Executive Officer) |
1. | I have reviewed this quarterly report on Form 10-Q of Cintas Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | January 6, 2017 | /s/ J. Michael Hansen | |
J. Michael Hansen | |||
Senior Vice President and Chief Financial Officer | |||
(Principal Financial Officer) |
/s/ Scott D. Farmer | |
Scott D. Farmer | |
Principal Executive Officer |
/s/ J. Michael Hansen | |
J. Michael Hansen | |
Principal Financial Officer |
Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Nov. 30, 2016 |
Dec. 31, 2016 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | CINTAS CORP | |
Entity Central Index Key | 0000723254 | |
Document Type | 10-Q | |
Document Period End Date | Nov. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --05-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 105,039,128 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q2 |
Consolidated Condensed Statements of Income (Unaudited) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Nov. 30, 2016 |
Nov. 30, 2015 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Income Statement [Abstract] | ||||
Income tax expense (benefit) | $ 8,953 | $ 146,395 | $ 8,953 | $ 142,976 |
Consolidated Condensed Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Nov. 30, 2016 |
Aug. 31, 2016 |
Nov. 30, 2015 |
Aug. 31, 2015 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Statement of Comprehensive Income [Abstract] | ||||||
Net income | $ 140,377 | $ 345,100 | $ 278,468 | $ 445,281 | ||
Other comprehensive (loss) income, net of tax: | ||||||
Foreign currency translation adjustments | (7,650) | (4,626) | (7,535) | (16,639) | ||
Cumulative translation adjustment on investment in Shred-it | 0 | 6,472 | 0 | 6,472 | ||
Change in fair value of derivatives | 26,390 | 0 | 14,353 | 0 | ||
Amortization of interest rate lock agreements | 385 | 488 | 770 | 976 | ||
Change in fair value of available-for-sale securities | 1 | (10) | 0 | (18) | ||
Other comprehensive income (loss) | 19,126 | $ (11,538) | 2,324 | $ (11,533) | 7,588 | (9,209) |
Comprehensive income | $ 159,503 | $ 347,424 | $ 286,056 | $ 436,072 |
Consolidated Condensed Balance Sheets (Unaudited) (Parenthetical) - shares |
Nov. 30, 2016 |
May 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, shares authorized (shares) | 100,000 | 100,000 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Common stock, shares authorized (shares) | 425,000,000 | 425,000,000 |
Common stock, shares issued (shares) | 180,589,260 | 179,598,516 |
Common stock, shares outstanding (shares) | 105,009,742 | 104,213,479 |
Treasury stock, shares (shares) | 75,579,518 | 75,385,037 |
Basis of Presentation |
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Nov. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation | Basis of Presentation The consolidated condensed financial statements of Cintas Corporation (Cintas, the Company, we, us or our) included herein have been prepared by Cintas, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been condensed or omitted pursuant to such rules and regulations. While we believe that the disclosures are adequately presented, we suggest that these consolidated condensed financial statements be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended May 31, 2016. A summary of our significant accounting policies is presented beginning on page 36 of that report. There have been no material changes in the accounting policies followed by Cintas during the current fiscal year other than the adoption of new accounting pronouncements discussed in Note 2. Interim results are subject to variations and are not necessarily indicative of the results of operations for a full fiscal year. In the opinion of management, adjustments (which include only normal recurring adjustments) necessary for a fair statement of the consolidated results of the interim periods shown have been made. Cintas' investment in the Shred-it Partnership (Shred-it) and the shredding business (Shredding) are classified as discontinued operations for all periods presented as a result of the sale of Shred-it during fiscal 2016. During fiscal 2015, Cintas sold its document imaging and retention services (Storage) business and, as a result, its operations are also classified as discontinued operations for all periods presented. See Note 12 entitled Discontinued Operations for more information. As disclosed in our Annual Report on Form 10-K for the fiscal year ended May 31, 2016, inventories are valued at the lower of cost (first-in, first-out) or market. Inventory is comprised of the following amounts at:
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New Accounting Pronouncements |
6 Months Ended |
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Nov. 30, 2016 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)," to clarify revenue recognition principles. This guidance is intended to improve disclosure requirements and enhance the comparability of revenue recognition practices. Improved disclosures under the amended guidance relate to the nature, amount, timing and uncertainty of revenue that is recognized from contracts with customers. This guidance will be effective for reporting periods beginning after December 15, 2017 and will be required to be applied retrospectively. Early application of the amendments in this update is not permitted. Cintas is currently evaluating the impact that ASU 2014-09 will have on its consolidated condensed financial statements. In April 2015, the FASB issued ASU 2015-03, "Interest - Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs." ASU 2015-03 requires that debt issuance costs related to a recognized debt liability be presented in the consolidated condensed balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This guidance is effective for annual and interim periods beginning after December 15, 2015. The guidance is applied retrospectively and early adoption is permitted. Cintas adopted ASU 2015-03 during the quarter ended August 31, 2016 and has applied this amended accounting guidance to its long-term debt and other assets for all periods presented. The impact of this change in accounting principle on balances previously reported as of May 31, 2016 was a reclassification of $5.6 million from other assets to long-term liabilities. In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805), Simplifying the Accounting for Measurement-Period Adjustments.” This amendment eliminates the requirement to retrospectively account for adjustments made to provisional amounts recognized in a business combination. This amendment became effective for Cintas beginning June 1, 2016, and was adopted prospectively in accordance with the standard. The adoption of this amendment did not have an effect on our consolidated condensed financial statements for the six months ended November 30, 2016. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. Topic 842 supersedes the previous leases standard, Accounting Standard Codification 840, "Leases." This guidance is effective for reporting periods beginning after December 15, 2018, however early adoption is permitted. Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. Cintas is currently evaluating the impact that ASU 2016-02 will have on its consolidated condensed financial statements. In March 2016, the FASB issued ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting." ASU 2016-09 is intended to simplify accounting for share-based payments. Upon adoption, ASU 2016-09 requires that excess tax benefits for share-based payments be recorded as a reduction of income tax expense and reflected within operating cash flows rather than being recorded within equity and reflected within financing cash flows. The standard also permits the repurchase of more of an employee’s shares for tax withholding purposes without triggering liability accounting, clarifies that all cash payments made on an employee’s behalf for withheld shares should be presented as a financing activity on our cash flows statement, and provides an accounting policy election to account for forfeitures as they occur. ASU 2016-09 is effective for interim and annual periods beginning after December 15, 2016, however early adoption is permitted. Cintas adopted ASU 2016-09 during the quarter ended August 31, 2016 and elected to make an accounting policy change to recognize forfeitures as they occur. The adoption impact on the consolidated condensed balance sheet was a cumulative-effect adjustment of $26.7 million, increasing opening retained earnings and decreasing paid-in capital. The impact of the adoption on the consolidated condensed income statements for the three and six months ended November 30, 2016 was a decrease in income tax expense of $2.4 million and $19.6 million, respectively. The election to account for forfeitures as they occur resulted in increases of $1.3 million and $3.0 million in stock based compensation expense for the three and six months ended November 30, 2016. No other new accounting pronouncement recently issued or newly effective had or is expected to have a material impact on Cintas' consolidated condensed financial statements. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements All financial instruments that are measured at fair value on a recurring basis (at least annually) have been classified within the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the consolidated condensed balance sheet date. These financial instruments measured at fair value on a recurring basis are summarized below:
Cintas’ cash and cash equivalents and marketable securities are generally classified within Level 1 or Level 2 of the fair value hierarchy. Financial instruments classified as Level 1 are based on quoted market prices in active markets, and financial instruments classified as Level 2 are based on quoted market prices, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency. The types of financial instruments Cintas classifies within Level 1 include most bank deposits and money market securities. Cintas does not adjust the quoted market price for such financial instruments. The types of financial instruments Cintas classifies within Level 2 are primarily high grade domestic commercial paper and Canadian treasury securities (federal). The valuation technique used for Cintas’ marketable securities classified within Level 2 of the fair value hierarchy is primarily the market approach. The primary inputs to value Cintas’ marketable securities are the respective instrument's future cash flows based on its stated yield and the amount a market participant would pay for a similar instrument. Primarily all of Cintas’ marketable securities are actively traded and the recorded fair value reflects current market conditions. However, due to the inherent volatility in the investment market, there is at least a possibility that recorded investment values may change in the near term. Interest, realized gains and losses and declines in value determined to be other than temporary on available-for-sale securities are included in interest income or expense. The cost of the securities sold is based on the specific identification method. The amortized cost basis of marketable securities as of May 31, 2016 was $70.4 million. All outstanding marketable securities as of May 31, 2016 had contractual maturities due within one year. Interest rate lock agreements were included in other assets as of November 30, 2016 and in long-term accrued liabilities as of May 31, 2016. The fair value of Cintas' interest rate lock agreements are based on similar exchange traded derivatives (market approach) and are, therefore, included within Level 2 of the fair value hierarchy. All other amounts included in other assets and long-term liabilities are not recorded at fair value. The methods described above may produce a fair value that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while Cintas believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the consolidated condensed balance sheet date. In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records assets and liabilities at fair value on a nonrecurring basis as required under GAAP. The Company's acquisition of ZEE Medical Inc. (ZEE) in the first quarter of fiscal 2016 was recorded at fair value. See Note 9 entitled Acquisitions for additional information on the measurement of the ZEE assets acquired and liabilities assumed. There were no material acquisitions during the six months ended November 30, 2016. |
Investments |
6 Months Ended |
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Nov. 30, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Investments at November 30, 2016 of $140.5 million include the cash surrender value of insurance policies of $120.4 million, equity method investments of $15.1 million, and cost method investments of $5.0 million. Investments at May 31, 2016 of $125.0 million include the cash surrender value of insurance policies of $108.1 million, equity method investments of $14.5 million and cost method investments of $2.4 million. Investments are evaluated for impairment on an annual basis or when indicators of impairment exist. For the six months ended November 30, 2016 and 2015, no impairment losses were recorded. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share from continuing operations using the two-class method for amounts attributable to Cintas’ common shares:
Basic and diluted income per share from discontinued operations were $0.16 for the three months ended November 30, 2016. Basic and diluted income per share from discontinued operations were $2.06 and $2.03, respectively, for the three months ended November 30, 2015. For the six months ended November 30, 2016, basic and diluted income per share from discontinued operations were $0.16. For the six months ended November 30, 2015, basic and diluted income per share from discontinued operations were $2.01 and $1.98, respectively. For the three months ended November 30, 2016 and 2015, options granted to purchase 0.7 million and 0.3 million shares of Cintas common stock, respectively, were excluded from the computation of diluted earnings per share. For the six months ended November 30, 2016 and 2015, options granted to purchase 0.6 million and 0.4 million shares of Cintas common stock, respectively, were excluded from the computation of diluted earnings per share. The exercise prices of these options were greater than the average market price of the common stock (anti-dilutive). On August 4, 2015, we announced that the Board of Directors authorized a $500.0 million share buyback program. In June 2016, we purchased less than 0.1 million shares at an average price of $94.09 per share for a total purchase price of $3.7 million. This completed the August 4, 2015 program through which Cintas purchased a total of 5.7 million shares of Cintas common stock at an average price of $87.89 per share for a total purchase price of $500.0 million. On August 2, 2016, Cintas announced that the Board of Directors authorized a new $500.0 million share buyback program, which does not have an expiration date. For the six months ended November 30, 2016, Cintas acquired 0.2 million shares of Cintas common stock for employee payroll taxes due on restricted stock awards that vested during the six months ended November 30, 2016. These shares were acquired at an average price of $99.88 per share for a total purchase price of $15.5 million. |
Goodwill, Service Contracts and Other Assets |
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Goodwill, Service Contracts and Other Assets [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill, Service Contracts and Other Assets | Goodwill, Service Contracts and Other Assets Changes in the carrying amount of goodwill and service contracts for the six months ended November 30, 2016, by reportable operating segment and All Other, are as follows:
Information regarding Cintas’ service contracts and other assets is as follows:
Amortization expense for service contracts and other assets was $3.6 million and $4.2 million for the three months ended November 30, 2016 and 2015, respectively. Amortization expense for service contracts and other assets was $7.0 million and $7.8 million for the six months ended November 30, 2016 and 2015, respectively. Estimated amortization expense for service contracts and other assets excluding any future acquisitions, for each of the next five full fiscal years is $14.7 million, $13.1 million, $12.5 million, $12.1 million and $10.2 million, respectively. |
Debt, Derivatives and Hedging Activities |
6 Months Ended |
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Nov. 30, 2016 | |
Debt, Derivatives and Hedging Activities [Abstract] | |
Debt, Derivatives and Hedging Activities | Debt, Derivatives and Hedging Activities Cintas' senior notes are recorded at cost, net of debt issuance costs. The fair value of the senior notes is estimated using Level 2 inputs based on general market prices. The carrying value and fair value of Cintas' senior notes as of November 30, 2016 were $1,050.0 million and $1,132.6 million, respectively, and as of May 31, 2016 were $1,300.0 million and $1,416.6 million, respectively. On June 1, 2016, Cintas paid the $250.0 million five-year senior notes that matured on that date with cash on hand and proceeds from the issuance of commercial paper. On August 15, 2016, the Company entered into the Agreement and Plan of Merger (Merger Agreement) pursuant to which the Company will acquire all outstanding shares of G&K Services, Inc. (G&K) for $97.50 per share in cash, for a total enterprise value of approximately $2.2 billion, including acquired net debt. It is expected that this acquisition will be financed with short-term and long-term debt. In connection with the Company's entry into the Merger Agreement, Cintas pre-paid $13.5 million in fees to acquire the bridge loan financing. As of November 30, 2016, these fees are recorded in prepaid assets on the balance sheet and will be expensed over the life of the bridge loan. In addition, the credit agreement that supports our commercial paper program was amended on September 16, 2016. The amendment increased the capacity of the revolving credit facility from $450.0 million to $600.0 million and added a $250.0 million term loan facility. The $150.0 million increase in the revolving credit facility will take effect on the earlier date of either the consummation of the merger (Merger) contemplated by the Merger Agreement among the Corporation, G&K and Bravo Merger Sub, Inc. (Merger Sub), a wholly-owned subsidiary of Cintas, or the date on which the Merger Agreement is validly terminated. The term loan facility shall be only funded upon the consummation of the Merger. The credit agreement has an accordion feature that provides Cintas the ability to request increases to the borrowing commitments under either the revolving credit facility or the term loan facility of up to $250.0 million in the aggregate, subject to customary conditions. The amendment also extended the maturity date of the agreement to September 15, 2021. As of November 30, 2016, there was $66.0 million of commercial paper outstanding with a weighted average interest rate of 0.84% and maturity dates less than 30 days. The fair value of the commercial paper is estimated using Level 2 inputs based on general market prices. The carrying value equals fair value. No commercial paper or borrowings on our revolving credit facility were outstanding as of May 31, 2016. Cintas uses interest rate locks to manage our overall interest expense as interest rate locks effectively change the interest rate of specific debt issuances. The treasury locks are entered into to protect against unfavorable movements in the benchmark treasury rate related to forecasted debt issuances. Cintas used interest rate lock agreements to hedge against movements in the treasury rates at the time Cintas issued its senior notes in fiscal 2007, fiscal 2008, fiscal 2011 and fiscal 2013. The amortization of the cash flow hedges resulted in an increase to other comprehensive income of $0.4 million and $0.5 million for the three months ended November 30, 2016 and 2015, respectively. For the six months ended November 30, 2016 and 2015, the amortization of the cash flow hedges resulted in an increase to other comprehensive income of $0.8 million and $1.0 million, respectively. During the third quarter of fiscal 2016, Cintas entered into interest rate lock agreements with a notional value of $550.0 million for a forecasted long-term debt issuance. As of November 30, 2016, the fair value of these treasury locks was $3.3 million and are recorded in other assets as an increase to other comprehensive income, net of tax. As of May 31, 2016, the the fair value of these treasury locks was $19.6 million and were recorded in long-term liabilities as a decrease to other comprehensive income, net of tax. The interest rate locks had no impact on net income or cash flows from continuing operations for the six months ended November 30, 2016. Cintas has certain covenants related to debt agreements. These covenants limit Cintas’ ability to incur certain liens, to engage in sale-leaseback transactions and to merge, consolidate or sell all or substantially all of Cintas’ assets. These covenants also require Cintas to maintain certain debt to consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) and interest coverage ratios. Cross-default provisions exist between certain debt instruments. If a default of a significant covenant were to occur, the default could result in an acceleration of the maturity of the indebtedness, impair liquidity and limit the ability to raise future capital. Cintas was in compliance with all debt covenants for all periods presented. |
Income Taxes |
6 Months Ended |
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Nov. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In the normal course of business, Cintas provides for uncertain tax positions and the related interest and adjusts its unrecognized tax benefits and accrued interest accordingly. During the three months ended November 30, 2016, unrecognized tax benefits decreased by approximately $1.8 million and accrued interest decreased by approximately $0.4 million. During the six months ended November 30, 2016, unrecognized tax benefits decreased by approximately $1.7 million and accrued interest decreased by approximately $0.2 million. All U.S. federal income tax returns are closed to audit through fiscal 2013. Cintas is currently in various audits in certain foreign jurisdictions and certain domestic states. The years under foreign and domestic state audits cover fiscal years back to 2009. Based on the resolution of the various audits and other potential regulatory developments, it is reasonably possible that the balance of unrecognized tax benefits would not change for the fiscal year ending May 31, 2017. The majority of Cintas' operations are in North America. Cintas is required to file federal income tax returns, as well as state income tax returns in a majority of the domestic states and also in certain Canadian provinces. At times, Cintas is subject to audits in these jurisdictions. The audits, by nature, are sometimes complex and can require several years to resolve. The final resolution of any such tax audit could result in either a reduction in Cintas' accruals or an increase in its income tax provision, either of which could have an impact on the consolidated condensed results of operations in any given period. |
Acquisitions |
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Nov. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions | Acquisitions On August 15, 2016, the Company entered into the Merger Agreement pursuant to which the Company will acquire all outstanding shares of G&K for $97.50 per share in cash, for a total enterprise value of approximately $2.2 billion, including acquired net debt. It is expected that this acquisition will be financed with short and long-term debt. The completion of the Merger is subject to customary conditions, including, without limitation: the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act), as amended; the receipt of Canadian antitrust approvals; the absence of any order, law or other legal restraint or prohibition preventing or prohibiting completion of the Merger; subject to certain exceptions, the accuracy of representations and warranties of the Company, Merger Sub and G&K; and the performance or compliance by the Company, Merger Sub and G&K with their respective covenants and agreements. On November 15, 2016, G&K held its annual meeting of shareholders at which the shareholders voted on and approved the Merger. The Merger has not closed as of the date of the filing of this Form 10-Q. On September 29, 2016, both the Company and G&K received a request for additional information and documentary material, commonly referred to as a "second request," from the Federal Trade Commission (FTC), pursuant to the HSR Act, in connection with the Merger. The FTC's second request has the effect of extending the waiting period applicable to the consummation of the Merger until the 30th day after substantial compliance by the Company and G&K with the second request, unless the waiting period is extended voluntarily by the parties or terminated sooner by the FTC. On October 12, 2016, both the Company and G&K received a supplemental information request, commonly referred to as SIR, from the Competition Bureau of Canada, pursuant to the Canada Competition Act, in connection with the Merger. SIR is part of the prescribed process for review of proposed transactions in Canada and has the effect of extending the waiting period applicable to the consummation of the Merger until the 30th day after compliance by the Company and G&K with the SIR. During the three and six months ended November 30, 2016, we incurred expenses of $3.3 million and $6.1 million, respectively, related to the pending Merger for legal and professional services and regulatory fees. Many of these expenses are non-deductible for income tax purposes once the Merger has been executed. During the first quarter of fiscal 2016, the Company acquired all of the shares of ZEE for acquisition-date fair value consideration of $134.0 million, consisting of cash of $120.6 million and contingent consideration, subject to certain holdback provisions of $13.4 million. To date, the Company has paid $4.5 million of the contingent consideration. This payment occurred during the three months ended November 30, 2016 and is included within other financing activities on the statement of cash flows. ZEE operates within the First Aid and Safety Services reportable operating segment. This acquisition has expanded our footprint in van delivered first aid, safety, training and emergency products and will allow us to serve an even greater number of customers in North America. The table below summarizes the final purchase price allocation of ZEE as determined by management with the assistance of third-party valuation specialists. Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the estimated future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. None of the goodwill is deductible for income tax purposes. The assets acquired and liabilities assumed are valued at the estimated fair value at the acquisition date as required by GAAP.
The estimated useful life of the acquired service contracts is 10 years. Cintas is required to provide additional disclosures about fair value measurements as part of the consolidated financial statements for each major category of assets and liabilities measured at fair value on a nonrecurring basis (including business acquisitions). The working capital assets and liabilities, as well as the property and equipment acquired, were valued using Level 2 inputs which included data points that are observable, such as definitive sales agreements, appraisals or established market values of comparable assets (market approach). Goodwill, service contracts and other intangibles were valued using Level 3 inputs, which are unobservable by nature, and included internal estimates of future cash flow using a discount rate of 11% (income approach). The results of operations for the acquired businesses are included in the consolidated condensed statements of income from the dates of acquisition. The proforma revenue, net income and earnings per share information relating to acquired businesses are not presented because they are not significant to Cintas. |
Accumulated Other Comprehensive Income (Loss) |
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Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The following table summarizes the changes in the accumulated balances for each component of accumulated other comprehensive income (loss), net of tax:
The following table summarizes the reclassifications out of accumulated other comprehensive loss:
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information Cintas classifies its business into two reportable operating segments and places the remainder of its operating segments in an All Other category. Cintas’ two reportable operating segments are Uniform Rental and Facility Services and First Aid and Safety Services. The Uniform Rental and Facility Services reportable operating segment consists of the rental and servicing of uniforms and other garments including flame resistant clothing, mats, mops and shop towels and other ancillary items. In addition to these rental items, restroom cleaning services and supplies, carpet and tile cleaning services and the sale of items from our catalogs to our customers on route are included within this reportable operating segment. The First Aid and Safety Services reportable operating segment consists of first aid and safety products and services. The remainder of Cintas’ business, which consists primarily of Fire Protection Services and its Direct Sale business, is included in All Other. Cintas evaluates the performance of each operating segment based on several factors of which the primary financial measures are operating segment revenue and income before income taxes. The accounting policies of the operating segments are the same as those described in Note 1 entitled Basis of Presentation. Information related to the operations of Cintas’ operating segments is set forth below:
(1) Corporate assets include cash and marketable securities in all periods. |
Discontinued Operations |
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Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations | Discontinued Operations During fiscal 2016, Cintas sold its investment in Shred-it and, as a result, the operations of Shred-it are classified as discontinued operations for all periods presented. During fiscal 2015, Cintas sold Storage and, as a result, its operations are also classified as discontinued operations for all periods presented. Shredding and Storage were previously included in the former Document Management Services reportable operating segment. In accordance with the applicable accounting guidance for the disposal of long-lived assets, the results of Shredding and Storage have been excluded from both continuing operations and operating segment results for all periods presented. During the three months ended November 30, 2016, we received additional proceeds related to contingent consideration on the sale of Shred-it. Cintas realized a pre-tax gain of $25.9 million as a result of the additional consideration received. As of November 30, 2016, Cintas still has the opportunity to receive additional consideration, subject to certain holdback provisions. Because of the uncertainty surrounding the holdback provisions, this opportunity represents a gain contingency that has not been recorded. In the second quarter of fiscal 2016, we completed the transaction to sell our investment in Shred-it. We recorded a pre-tax gain on the sale of Shred-it of $349.7 million. Cintas’ share of the proceeds from the sale were $578.3 million. In the three and six months ended November 30, 2015, Cintas recorded a net loss on the investment in Shred-it of $9.3 million and $24.3 million, respectively. During the three months ended November 30, 2015, Cintas received additional proceeds related to contingent consideration on the sale of Storage. The Company realized a pre-tax gain of $10.9 million as a result of the additional consideration received. In the first quarter of fiscal 2016, Cintas sold the remaining storage assets classified as held for sale. In connection with the sale of these assets, Cintas received proceeds of $24.4 million and realized a pre-tax gain of $4.8 million. Following is selected financial information included in net income from discontinued operations for Shred-it and Storage:
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Supplemental Guarantor Information |
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Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Guarantor Information | Supplemental Guarantor Information Cintas Corporation No. 2 (Corp. 2) is the indirectly, wholly-owned principal operating subsidiary of Cintas. Corp. 2 is the issuer of the $66.0 million aggregate principal amount of commercial paper and the $1,050.0 million aggregate principal amount of senior notes, which are unconditionally guaranteed, jointly and severally, by Cintas Corporation and certain wholly-owned, direct and indirect domestic subsidiaries. As allowed by SEC rules, the following condensed consolidating financial statements are provided as an alternative to filing separate financial statements of the guarantors. Each of the subsidiaries presented in the following condensed consolidating financial statements has been fully consolidated in Cintas’ consolidated financial statements. The following condensed consolidating financial statements should be read in conjunction with the consolidated financial statements of Cintas and notes thereto of which this note is an integral part. During fiscal 2017, the Company merged a legal entity previously included in subsidiary guarantors into Corp. 2. This restructuring has been reflected as of the beginning of the earliest period presented herein. Condensed consolidating financial statements for Cintas, Corp. 2, the subsidiary guarantors and non-guarantors are presented on the following pages: Condensed Consolidating Income Statement Three Months Ended November 30, 2016 (In thousands)
Condensed Consolidating Income Statement Three Months Ended November 30, 2015 (In thousands)
Condensed Consolidating Income Statement Six Months Ended November 30, 2016 (In thousands)
Condensed Consolidating Income Statement Six Months Ended November 30, 2015 (In thousands)
Condensed Consolidating Statement of Comprehensive Income Three Months Ended November 30, 2016 (In thousands)
Condensed Consolidating Statement of Comprehensive Income Three Months Ended November 30, 2015 (In thousands)
Condensed Consolidating Statement of Comprehensive Income Six Months Ended November 30, 2016 (In thousands)
Condensed Consolidating Statement of Comprehensive Income Six Months Ended November 30, 2015 (In thousands)
Condensed Consolidating Balance Sheet As of November 30, 2016 (In thousands)
Condensed Consolidating Balance Sheet As of May 31, 2016 (In thousands)
Condensed Consolidating Statement of Cash Flows Six Months Ended November 30, 2016 (In thousands)
Condensed Consolidating Statement of Cash Flows Six Months Ended November 30, 2015 (In thousands)
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New Accounting Pronouncements (Policies) |
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Accounting Policies [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)," to clarify revenue recognition principles. This guidance is intended to improve disclosure requirements and enhance the comparability of revenue recognition practices. Improved disclosures under the amended guidance relate to the nature, amount, timing and uncertainty of revenue that is recognized from contracts with customers. This guidance will be effective for reporting periods beginning after December 15, 2017 and will be required to be applied retrospectively. Early application of the amendments in this update is not permitted. Cintas is currently evaluating the impact that ASU 2014-09 will have on its consolidated condensed financial statements. In April 2015, the FASB issued ASU 2015-03, "Interest - Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs." ASU 2015-03 requires that debt issuance costs related to a recognized debt liability be presented in the consolidated condensed balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This guidance is effective for annual and interim periods beginning after December 15, 2015. The guidance is applied retrospectively and early adoption is permitted. Cintas adopted ASU 2015-03 during the quarter ended August 31, 2016 and has applied this amended accounting guidance to its long-term debt and other assets for all periods presented. The impact of this change in accounting principle on balances previously reported as of May 31, 2016 was a reclassification of $5.6 million from other assets to long-term liabilities. In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805), Simplifying the Accounting for Measurement-Period Adjustments.” This amendment eliminates the requirement to retrospectively account for adjustments made to provisional amounts recognized in a business combination. This amendment became effective for Cintas beginning June 1, 2016, and was adopted prospectively in accordance with the standard. The adoption of this amendment did not have an effect on our consolidated condensed financial statements for the six months ended November 30, 2016. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. Topic 842 supersedes the previous leases standard, Accounting Standard Codification 840, "Leases." This guidance is effective for reporting periods beginning after December 15, 2018, however early adoption is permitted. Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. Cintas is currently evaluating the impact that ASU 2016-02 will have on its consolidated condensed financial statements. In March 2016, the FASB issued ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting." ASU 2016-09 is intended to simplify accounting for share-based payments. Upon adoption, ASU 2016-09 requires that excess tax benefits for share-based payments be recorded as a reduction of income tax expense and reflected within operating cash flows rather than being recorded within equity and reflected within financing cash flows. The standard also permits the repurchase of more of an employee’s shares for tax withholding purposes without triggering liability accounting, clarifies that all cash payments made on an employee’s behalf for withheld shares should be presented as a financing activity on our cash flows statement, and provides an accounting policy election to account for forfeitures as they occur. ASU 2016-09 is effective for interim and annual periods beginning after December 15, 2016, however early adoption is permitted. Cintas adopted ASU 2016-09 during the quarter ended August 31, 2016 and elected to make an accounting policy change to recognize forfeitures as they occur. The adoption impact on the consolidated condensed balance sheet was a cumulative-effect adjustment of $26.7 million, increasing opening retained earnings and decreasing paid-in capital. The impact of the adoption on the consolidated condensed income statements for the three and six months ended November 30, 2016 was a decrease in income tax expense of $2.4 million and $19.6 million, respectively. The election to account for forfeitures as they occur resulted in increases of $1.3 million and $3.0 million in stock based compensation expense for the three and six months ended November 30, 2016. No other new accounting pronouncement recently issued or newly effective had or is expected to have a material impact on Cintas' consolidated condensed financial statements. |
Basis of Presentation (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory | Inventory is comprised of the following amounts at:
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Fair Value Measurements (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Financial Instruments Measured on a Recurring Basis | These financial instruments measured at fair value on a recurring basis are summarized below:
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Earnings Per Share (Tables) |
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---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share from continuing operations using the two-class method for amounts attributable to Cintas’ common shares:
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Goodwill, Service Contracts and Other Assets (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill, Service Contracts and Other Assets [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Carrying Amount of Goodwill by Operating Segment | Changes in the carrying amount of goodwill and service contracts for the six months ended November 30, 2016, by reportable operating segment and All Other, are as follows:
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Changes in the Carrying Amount of Service Contracts by Operating Segment |
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Information Regarding Service Contracts and Other Assets | Information regarding Cintas’ service contracts and other assets is as follows:
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Acquisitions (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Assets Acquired and Liabilities Assumed | The assets acquired and liabilities assumed are valued at the estimated fair value at the acquisition date as required by GAAP.
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Accumulated Other Comprehensive Income (Loss) (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Changes in Accumulated Other Comprehensive Income (Loss) | The following table summarizes the changes in the accumulated balances for each component of accumulated other comprehensive income (loss), net of tax:
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Schedule of Reclassifications Out of Accumulated Other Comprehensive Loss | The following table summarizes the reclassifications out of accumulated other comprehensive loss:
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Segment Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Information Related to Operating Segments | Information related to the operations of Cintas’ operating segments is set forth below:
(1) Corporate assets include cash and marketable securities in all periods. |
Discontinued Operations (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Discontinued Operations | Following is selected financial information included in net income from discontinued operations for Shred-it and Storage:
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Supplemental Guarantor Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Nov. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Consolidating Income Statement | Condensed Consolidating Income Statement Three Months Ended November 30, 2016 (In thousands)
Condensed Consolidating Income Statement Three Months Ended November 30, 2015 (In thousands)
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Condensed Consolidating Statement of Comprehensive Income | Condensed Consolidating Statement of Comprehensive Income Three Months Ended November 30, 2016 (In thousands)
Condensed Consolidating Statement of Comprehensive Income Three Months Ended November 30, 2015 (In thousands)
Condensed Consolidating Statement of Comprehensive Income Six Months Ended November 30, 2016 (In thousands)
Condensed Consolidating Statement of Comprehensive Income Six Months Ended November 30, 2015 (In thousands)
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Condensed Consolidating Balance Sheet | Condensed Consolidating Balance Sheet As of November 30, 2016 (In thousands)
Condensed Consolidating Balance Sheet As of May 31, 2016 (In thousands)
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Condensed Consolidating Statement of Cash Flows | Condensed Consolidating Statement of Cash Flows Six Months Ended November 30, 2016 (In thousands)
Condensed Consolidating Statement of Cash Flows Six Months Ended November 30, 2015 (In thousands)
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Basis of Presentation - Inventories (Details) - USD ($) $ in Thousands |
Nov. 30, 2016 |
May 31, 2016 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 11,303 | $ 17,794 |
Work in process | 16,772 | 14,731 |
Finished goods | 235,226 | 216,837 |
Inventories, net | $ 263,301 | $ 249,362 |
Fair Value Measurements - Narrative (Details) $ in Millions |
12 Months Ended |
---|---|
May 31, 2016
USD ($)
| |
Fair value on a recurring basis | |
Contractual maturities (less than) | 1 year |
Canadian treasury securities | |
Fair value on a recurring basis | |
Amortized cost basis of marketable securities | $ 70.4 |
Investments - Narrative (Details) - USD ($) |
6 Months Ended | ||
---|---|---|---|
Nov. 30, 2016 |
Nov. 30, 2015 |
May 31, 2016 |
|
Investments, Debt and Equity Securities [Abstract] | |||
Investments | $ 140,530,000 | $ 124,952,000 | |
Cash surrender value of insurance policies | 120,400,000 | 108,100,000 | |
Equity method investments | 15,100,000 | 14,500,000 | |
Cost method investments | 5,000,000 | $ 2,400,000 | |
Losses due to impairment | $ 0 | $ 0 |
Goodwill, Service Contracts and Other Assets - Changes in Carrying Amount of Goodwill (Details) $ in Thousands |
6 Months Ended |
---|---|
Nov. 30, 2016
USD ($)
| |
Goodwill [Roll Forward] | |
Beginning balance | $ 1,291,593 |
Goodwill acquired | 10,802 |
Foreign currency translation | (1,004) |
Ending balance | 1,301,391 |
Uniform Rental and Facility Services | |
Goodwill [Roll Forward] | |
Beginning balance | 953,216 |
Goodwill acquired | 5,704 |
Foreign currency translation | (482) |
Ending balance | 958,438 |
First Aid and Safety Services | |
Goodwill [Roll Forward] | |
Beginning balance | 241,448 |
Goodwill acquired | 1,871 |
Foreign currency translation | (511) |
Ending balance | 242,808 |
All Other | |
Goodwill [Roll Forward] | |
Beginning balance | 96,929 |
Goodwill acquired | 3,227 |
Foreign currency translation | (11) |
Ending balance | $ 100,145 |
Goodwill, Service Contracts and Other Assets - Changes in Carrying Amount of Service Contracts (Details) $ in Thousands |
6 Months Ended |
---|---|
Nov. 30, 2016
USD ($)
| |
Service contracts [Roll Forward] | |
Beginning balance | $ 83,715 |
Service contracts acquired | 8,362 |
Service contracts amortization | (6,485) |
Foreign currency translation | (75) |
Ending balance | 85,517 |
Uniform Rental and Facility Services | |
Service contracts [Roll Forward] | |
Beginning balance | 21,191 |
Service contracts acquired | 3,514 |
Service contracts amortization | (1,647) |
Foreign currency translation | (48) |
Ending balance | 23,010 |
First Aid and Safety Services | |
Service contracts [Roll Forward] | |
Beginning balance | 32,252 |
Service contracts acquired | 1,612 |
Service contracts amortization | (1,873) |
Foreign currency translation | (27) |
Ending balance | 31,964 |
All Other | |
Service contracts [Roll Forward] | |
Beginning balance | 30,272 |
Service contracts acquired | 3,236 |
Service contracts amortization | (2,965) |
Foreign currency translation | 0 |
Ending balance | $ 30,543 |
Goodwill, Service Contracts and Other Assets - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Nov. 30, 2016 |
Nov. 30, 2015 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Goodwill [Line Items] | ||||
Amortization expense for continuing operations | $ 3.6 | $ 4.2 | $ 7.0 | $ 7.8 |
Estimated amortization expense, year one | 14.7 | 14.7 | ||
Estimated amortization expense, year two | 13.1 | 13.1 | ||
Estimated amortization expense, year three | 12.5 | 12.5 | ||
Estimated amortization expense, year four | 12.1 | 12.1 | ||
Estimated amortization expense, year five | $ 10.2 | $ 10.2 |
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended |
---|---|---|
Nov. 30, 2016 |
Nov. 30, 2016 |
|
Income Tax Disclosure [Abstract] | ||
Unrecognized tax benefits, period increase (decrease) | $ (1.8) | $ (1.7) |
Unrecognized tax benefits, decrease in accrued interest | $ 0.4 | $ 0.2 |
Acquisitions - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Aug. 15, 2016 |
Nov. 30, 2016 |
Aug. 31, 2016 |
Nov. 30, 2015 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Business Acquisition [Line Items] | ||||||
Costs incurred | $ 3,347 | $ 0 | $ 6,134 | $ 0 | ||
Goodwill deductible for income tax purposes | $ 0 | |||||
Contingent consideration paid | 4,500 | |||||
G&K Services | ||||||
Business Acquisition [Line Items] | ||||||
Share price of acquisition (in dollars per share) | $ 97.50 | |||||
Consideration transferred | $ 2,200,000 | |||||
Costs incurred | $ 3,347 | $ 6,100 | ||||
ZEE | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | 134,000 | |||||
Cash consideration | 120,600 | |||||
Contingent consideration subject to holdback provisions | $ 13,400 | |||||
ZEE | Level 3 | ||||||
Business Acquisition [Line Items] | ||||||
Discount rate | 11.00% | |||||
ZEE | Service contracts | ||||||
Business Acquisition [Line Items] | ||||||
Estimated useful life of service contracts | 10 years |
Acquisitions - Schedule of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands |
Nov. 30, 2016 |
Aug. 31, 2016 |
May 31, 2016 |
---|---|---|---|
Assets: | |||
Goodwill | $ 1,301,391 | $ 1,291,593 | |
Liabilities: | |||
Total consideration | $ 134,000 | ||
ZEE | |||
Assets: | |||
Cash and cash equivalents | 333 | ||
Accounts receivable | 16,705 | ||
Inventory | 5,987 | ||
Other current assets | 1,443 | ||
Property, plant and equipment | 849 | ||
Goodwill | 87,442 | ||
Liabilities: | |||
Accounts payable | (7,195) | ||
Accrued liabilities | (4,428) | ||
Deferred income taxes | (5,636) | ||
Service contracts | ZEE | |||
Assets: | |||
Intangible assets | 34,000 | ||
Other intangibles | ZEE | |||
Assets: | |||
Intangible assets | $ 4,500 |
Accumulated Other Comprehensive Income (Loss) - Schedule of Reclassifications Out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Nov. 30, 2016 |
Aug. 31, 2016 |
Nov. 30, 2015 |
Aug. 31, 2015 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||
Amortization of interest rate locks | $ (615) | $ (783) | $ (1,229) | $ (1,565) | ||
Tax benefit | 230 | 295 | 459 | 589 | ||
Amortization of interest rate locks, net of tax | (385) | (488) | (770) | (976) | ||
Total amount reclassified out of accumulated other comprehensive income | (385) | $ (385) | (6,960) | $ (488) | ||
Accumulated Translation Adjustment on Investment Attributable to Parent | ||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||
Tax benefit | 0 | 3,909 | 0 | 3,909 | ||
Cumulative translation adjustment on Shred-it | 0 | (10,381) | 0 | (10,381) | ||
Total amount reclassified out of accumulated other comprehensive income | $ 0 | $ (6,472) | $ 0 | $ (6,472) |
Segment Information - Narrative (Details) |
6 Months Ended |
---|---|
Nov. 30, 2016
segment
| |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Segment Information - Information Related to Operating Segments (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Nov. 30, 2016 |
Nov. 30, 2015 |
Nov. 30, 2016 |
Nov. 30, 2015 |
May 31, 2016 |
|
Segment Reporting Information | |||||
Revenue | $ 1,296,923 | $ 1,219,080 | $ 2,591,053 | $ 2,417,970 | |
Income (loss) before income taxes | 189,622 | 184,289 | 382,476 | 353,503 | |
Total assets | 4,214,579 | 4,444,610 | 4,214,579 | 4,444,610 | $ 4,098,815 |
Operating Segments | Uniform Rental and Facility Services | |||||
Segment Reporting Information | |||||
Revenue | 1,005,565 | 937,704 | 2,005,161 | 1,876,112 | |
Income (loss) before income taxes | 177,361 | 169,295 | 362,606 | 334,676 | |
Total assets | 3,266,422 | 2,990,828 | 3,266,422 | 2,990,828 | |
Operating Segments | First Aid and Safety Services | |||||
Segment Reporting Information | |||||
Revenue | 124,797 | 120,438 | 249,636 | 219,926 | |
Income (loss) before income taxes | 14,779 | 14,847 | 26,290 | 23,439 | |
Total assets | 443,151 | 426,089 | 443,151 | 426,089 | |
Operating Segments | All Other | |||||
Segment Reporting Information | |||||
Revenue | 166,561 | 160,938 | 336,256 | 321,932 | |
Income (loss) before income taxes | 10,718 | 16,207 | 20,923 | 27,741 | |
Total assets | 361,433 | 355,082 | 361,433 | 355,082 | |
Corporate | |||||
Segment Reporting Information | |||||
Revenue | 0 | 0 | 0 | 0 | |
Income (loss) before income taxes | (13,236) | (16,060) | (27,343) | (32,353) | |
Total assets | $ 143,573 | $ 672,611 | $ 143,573 | $ 672,611 |
Discontinued Operations - Schedule of Discontinued Operations (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Nov. 30, 2016 |
Nov. 30, 2015 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Gain on Storage transactions | $ 0 | $ 15,786 | ||
Gain on Shred-it | 25,876 | 349,738 | ||
Net income from discontinued operations | $ 16,923 | $ 229,647 | 16,923 | 223,630 |
Discontinued Operations | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Income before income taxes | 0 | 845 | 0 | 1,082 |
Gain on Storage transactions | 0 | 10,943 | 0 | 15,786 |
Gain on Shred-it | 25,876 | 364,254 | 25,876 | 349,738 |
Income tax expense on net gain | (8,953) | (146,395) | (8,953) | (142,976) |
Net income from discontinued operations | $ 16,923 | $ 229,647 | $ 16,923 | $ 223,630 |
Supplemental Guarantor Information - Narrative (Details) - USD ($) $ in Thousands |
Nov. 30, 2016 |
May 31, 2016 |
---|---|---|
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | ||
Short-term Debt | $ 66,000 | $ 250,000 |
Senior notes | $ 1,050,000 |
Supplemental Guarantor Information - Condensed Consolidating Income Statement (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Nov. 30, 2016 |
Nov. 30, 2015 |
Nov. 30, 2016 |
Nov. 30, 2015 |
|
Revenue: | ||||
Uniform rental and facility services | $ 1,005,565 | $ 937,704 | $ 2,005,161 | $ 1,876,112 |
Other | 291,358 | 281,376 | 585,892 | 541,858 |
Equity in net income of affiliates | 0 | 0 | 0 | 0 |
Total revenue | 1,296,923 | 1,219,080 | 2,591,053 | 2,417,970 |
Costs and expenses (income): | ||||
Cost of uniform rental and facility services | 555,752 | 526,091 | 1,096,684 | 1,044,594 |
Cost of other | 169,744 | 165,589 | 339,168 | 321,832 |
Selling and administrative expenses | 365,222 | 327,051 | 739,248 | 665,688 |
G&K Services, Inc. transaction expenses | 3,347 | 0 | 6,134 | 0 |
Operating income | 202,858 | 200,349 | 409,819 | 385,856 |
Interest income | (31) | (111) | (96) | (230) |
Interest expense (income) | 13,267 | 16,171 | 27,439 | 32,583 |
Income before income taxes | 189,622 | 184,289 | 382,476 | 353,503 |
Income taxes | 66,168 | 68,836 | 120,931 | 131,852 |
Income from continuing operations | 123,454 | 115,453 | 261,545 | 221,651 |
Income from discontinued operations, net of tax | 16,923 | 229,647 | 16,923 | 223,630 |
Net income | 140,377 | 345,100 | 278,468 | 445,281 |
Eliminations | ||||
Revenue: | ||||
Uniform rental and facility services | (43,373) | (39,063) | (87,862) | (78,261) |
Other | (138,815) | (131,137) | (274,372) | (259,370) |
Equity in net income of affiliates | (140,377) | (115,453) | (278,468) | (221,651) |
Total revenue | (322,565) | (285,653) | (640,702) | (559,282) |
Costs and expenses (income): | ||||
Cost of uniform rental and facility services | (63,827) | (58,389) | (129,737) | (117,111) |
Cost of other | (111,711) | (106,278) | (221,208) | (205,875) |
Selling and administrative expenses | (6,940) | (4,732) | (14,379) | (12,196) |
G&K Services, Inc. transaction expenses | 0 | 0 | ||
Operating income | (140,087) | (116,254) | (275,378) | (224,100) |
Interest income | 1 | 0 | 1 | 0 |
Interest expense (income) | 0 | 0 | 0 | 0 |
Income before income taxes | (140,088) | (116,254) | (275,379) | (224,100) |
Income taxes | (29) | (28) | (55) | (53) |
Income from continuing operations | (140,059) | (116,226) | (275,324) | (224,047) |
Income from discontinued operations, net of tax | 0 | (229,647) | 0 | (223,630) |
Net income | (140,059) | (345,873) | (275,324) | (447,677) |
Cintas Corporation | ||||
Revenue: | ||||
Uniform rental and facility services | 0 | 0 | 0 | 0 |
Other | 0 | 0 | 0 | 0 |
Equity in net income of affiliates | 140,377 | 115,453 | 278,468 | 221,651 |
Total revenue | 140,377 | 115,453 | 278,468 | 221,651 |
Costs and expenses (income): | ||||
Cost of uniform rental and facility services | 0 | 0 | 0 | 0 |
Cost of other | 0 | 0 | 0 | 0 |
Selling and administrative expenses | 0 | 0 | 0 | 0 |
G&K Services, Inc. transaction expenses | 0 | 0 | ||
Operating income | 140,377 | 115,453 | 278,468 | 221,651 |
Interest income | 0 | 0 | 0 | 0 |
Interest expense (income) | 0 | 0 | 0 | 0 |
Income before income taxes | 140,377 | 115,453 | 278,468 | 221,651 |
Income taxes | 0 | 0 | 0 | 0 |
Income from continuing operations | 140,377 | 115,453 | 278,468 | 221,651 |
Income from discontinued operations, net of tax | 0 | 229,647 | 0 | 223,630 |
Net income | 140,377 | 345,100 | 278,468 | 445,281 |
Corp. 2 | ||||
Revenue: | ||||
Uniform rental and facility services | 841,442 | 786,386 | 1,678,716 | 1,573,555 |
Other | 411,378 | 394,260 | 821,626 | 766,871 |
Equity in net income of affiliates | 0 | 0 | 0 | 0 |
Total revenue | 1,252,820 | 1,180,646 | 2,500,342 | 2,340,426 |
Costs and expenses (income): | ||||
Cost of uniform rental and facility services | 487,653 | 461,843 | 966,709 | 917,050 |
Cost of other | 287,368 | 277,841 | 567,392 | 536,831 |
Selling and administrative expenses | 401,715 | 365,125 | 813,649 | 734,818 |
G&K Services, Inc. transaction expenses | 0 | 0 | ||
Operating income | 76,084 | 75,837 | 152,592 | 151,727 |
Interest income | 0 | (12) | 0 | (12) |
Interest expense (income) | 14,528 | 16,427 | 29,355 | 32,802 |
Income before income taxes | 61,556 | 59,422 | 123,237 | 118,937 |
Income taxes | 21,534 | 20,496 | 39,344 | 42,878 |
Income from continuing operations | 40,022 | 38,926 | 83,893 | 76,059 |
Income from discontinued operations, net of tax | 14,982 | 234,604 | 14,982 | 229,281 |
Net income | 55,004 | 273,530 | 98,875 | 305,340 |
Subsidiary Guarantors | ||||
Revenue: | ||||
Uniform rental and facility services | 149,886 | 136,707 | 299,034 | 273,132 |
Other | 633 | 737 | 1,601 | 2,030 |
Equity in net income of affiliates | 0 | 0 | 0 | 0 |
Total revenue | 150,519 | 137,444 | 300,635 | 275,162 |
Costs and expenses (income): | ||||
Cost of uniform rental and facility services | 94,323 | 86,702 | 184,995 | 172,900 |
Cost of other | (19,549) | (18,291) | (34,480) | (32,547) |
Selling and administrative expenses | (48,256) | (49,482) | (98,990) | (90,954) |
G&K Services, Inc. transaction expenses | 3,347 | 6,134 | ||
Operating income | 120,654 | 118,515 | 242,976 | 225,763 |
Interest income | (7) | (68) | (24) | (116) |
Interest expense (income) | (1,176) | (256) | (1,878) | (218) |
Income before income taxes | 121,837 | 118,839 | 244,878 | 226,097 |
Income taxes | 42,652 | 42,108 | 78,178 | 81,511 |
Income from continuing operations | 79,185 | 76,731 | 166,700 | 144,586 |
Income from discontinued operations, net of tax | 0 | 0 | 0 | 0 |
Net income | 79,185 | 76,731 | 166,700 | 144,586 |
Non- Guarantors | ||||
Revenue: | ||||
Uniform rental and facility services | 57,610 | 53,674 | 115,273 | 107,686 |
Other | 18,162 | 17,516 | 37,037 | 32,327 |
Equity in net income of affiliates | 0 | 0 | 0 | 0 |
Total revenue | 75,772 | 71,190 | 152,310 | 140,013 |
Costs and expenses (income): | ||||
Cost of uniform rental and facility services | 37,603 | 35,935 | 74,717 | 71,755 |
Cost of other | 13,636 | 12,317 | 27,464 | 23,423 |
Selling and administrative expenses | 18,703 | 16,140 | 38,968 | 34,020 |
G&K Services, Inc. transaction expenses | 0 | 0 | ||
Operating income | 5,830 | 6,798 | 11,161 | 10,815 |
Interest income | (25) | (31) | (73) | (102) |
Interest expense (income) | (85) | 0 | (38) | (1) |
Income before income taxes | 5,940 | 6,829 | 11,272 | 10,918 |
Income taxes | 2,011 | 6,260 | 3,464 | 7,516 |
Income from continuing operations | 3,929 | 569 | 7,808 | 3,402 |
Income from discontinued operations, net of tax | 1,941 | (4,957) | 1,941 | (5,651) |
Net income | $ 5,870 | $ (4,388) | $ 9,749 | $ (2,249) |
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