Supplemental Guarantor Information

12 Months Ended

May 31, 2011

15. 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 $1,275.0 million of long-term senior notes, which are unconditionally guaranteed, jointly and severally, by Cintas Corporation and its 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.

Condensed consolidating financial statements for Cintas, Corp. 2, the subsidiary guarantors and non-guarantors are presented on the following pages:

Condensed Consolidating Income Statement



Year Ended May 31, 2011 (in thousands)			Cintas Corporation		Corp. 2			Subsidiary Guarantors			Non- Guarantors			Eliminations			Cintas Corporation Consolidated
Revenue:
Rental uniforms and ancillary products		$	—	$	2,069,895		$	531,525		$	196,380		$	(105,552	)	$	2,692,248
Other services			—		1,395,119			340,063			109,634			(726,680	)		1,118,136
Equity in net income of affiliates			246,989		—			—			—			(246,989	)		—

			246,989		3,465,014			871,588			306,014			(1,079,221	)		3,810,384
Costs and expenses (income):
Cost of rental uniforms and ancillary products			—		1,305,908			330,442			132,463			(238,357	)		1,530,456
	Cost of other services		—		876,359			316,650			67,997			(590,365	)		670,641
Selling and administrative expenses			—		1,065,037			17,270			92,839			(6,202	)		1,168,944

Operating income			246,989		217,710			207,226			12,715			(244,297	)		440,343
Interest income			—		(589	)		(697	)		(100,777	)		100,033			(2,030	)
Interest expense (income)			—		52,357			(2,687	)		34			—			49,704

Income before income taxes			246,989		165,942			210,610			113,458			(344,330	)		392,669
Income taxes			—		60,028			76,186			9,494			(28	)		145,680

Net income		$	246,989	$	105,914		$	134,424		$	103,964		$	(344,302	)	$	246,989

Condensed Consolidating Income Statement



Year Ended May 31, 2010 (in thousands)		Cintas Corporation		Corp. 2			Subsidiary Guarantors			Non- Guarantors			Eliminations			Cintas Corporation Consolidated
Revenue:
Rental uniforms and ancillary products	$	—	$	1,970,303		$	518,254		$	180,847		$	(100,047	)	$	2,569,357
Other services		—		1,216,779			351,368			66,229			(656,394	)		977,982
Equity in net income of affiliates		215,620		—			—			—			(215,620	)		—

		215,620		3,187,082			869,622			247,076			(972,061	)		3,547,339
Costs and expenses (income):
Cost of rental uniforms and ancillary products		—		1,226,076			332,935			111,340			(220,775	)		1,449,576
Cost of other services		—		798,841			297,890			41,316			(538,101	)		599,946
Selling and administrative expenses		—		1,037,945			(20,140	)		67,669			885			1,086,359
Legal settlements, net of insurance proceeds		—		—			23,529			—			—			23,529
Restructuring charges		—		(1,080	)		(1,800	)		—			—			(2,880	)

Operating income		215,620		125,300			237,208			26,751			(214,070	)		390,809
Interest income		—		(268	)		(1,130	)		(297	)		—			(1,695	)
Interest expense (income)		—		51,486			(2,897	)		23			—			48,612

Income before income taxes		215,620		74,082			241,235			27,025			(214,070	)		343,892
Income taxes		—		27,936			91,239			9,123			(26	)		128,272

Net income	$	215,620	$	46,146		$	149,996		$	17,902		$	(214,044	)	$	215,620

Condensed Consolidating Income Statement



Year Ended May 31, 2009 (in thousands)		Cintas Corporation		Corp. 2		Subsidiary Guarantors			Non- Guarantors			Eliminations			Cintas Corporation Consolidated
Revenue:
Rental uniforms and ancillary products	$	—	$	2,101,857	$	569,780		$	175,711		$	(92,333	)	$	2,755,015
Other services		—		1,295,603		397,426			60,414			(733,773	)		1,019,670
Equity in net income of affiliates		226,357		—		—			—			(226,357	)		—

		226,357		3,397,460		967,206			236,125			(1,052,463	)		3,774,685
Costs and expenses (income):
Cost of rental uniforms and ancillary products		—		1,242,048		368,125			106,856			(154,799	)		1,562,230
Cost of other services		—		958,634		348,159			38,449			(683,658	)		661,584
Selling and administrative expenses		—		1,051,221		(27,889	)		57,953			1,424			1,082,709
Restructuring charges		—		6,575		3,531			103			—			10,209
Impairment of long-lived assets		—		25,713		17,328			5,847			—			48,888

Operating income		226,357		113,269		257,952			26,917			(215,430	)		409,065
Interest income		—		—		(930	)		(1,834	)		—			(2,764	)
Interest expense (income)		—		53,197		(2,982	)		21			—			50,236

Income before income taxes		226,357		60,072		261,864			28,730			(215,430	)		361,593
Income taxes		—		17,152		110,001			8,083			—			135,236

Net income	$	226,357	$	42,920	$	151,863		$	20,647		$	(215,430	)	$	226,357

Condensed Consolidating Balance Sheet



As of May 31, 2011 (in thousands)		Cintas Corporation			Corp. 2			Subsidiary Guarantors			Non- Guarantors			Eliminations			Cintas Corporation Consolidated
Assets
Current assets:
Cash and cash equivalents	$	—		$	54,957		$	313,283		$	69,866		$	—		$	438,106
Marketable securities		—			—			—			87,220			—			87,220
Accounts receivable, net		—			312,033			76,484			40,614			—			429,131
Inventories, net		—			204,536			24,943			13,266			6,913			249,658
Uniforms and other rental items in service		—			302,897			82,148			34,895			(26,114	)		393,826
Income taxes, current		—			949			8,355			24,238			—			33,542
Deferred tax asset (liability)		—			566			47,905			(2,658	)		—			45,813
Prepaid expenses and other		—			5,738			13,732			4,011			—			23,481

Total current assets		—			881,676			566,850			271,452			(19,201	)		1,700,777
Property and equipment, at cost, net		—			587,701			274,086			84,431			—			946,218
Goodwill		—			—			1,416,926			70,956			—			1,487,882
Service contracts, net		—			94,379			663			7,270			—			102,312
Other assets, net		1,778,595			1,629,598			2,070,017			369,527			(5,732,986	)		114,751

	$	1,778,595		$	3,193,354		$	4,328,542		$	803,636		$	(5,752,187	)	$	4,351,940

Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable	$	(465,247	)	$	(329,430	)	$	855,739		$	11,198		$	38,019		$	110,279
Accrued compensation and related liabilities		—			55,138			20,153			4,543			—			79,834
Accrued liabilities		—			61,399			154,861			27,235			(804	)		242,691
Long-term debt due within one year		—			855			480			—			—			1,335

Total current liabilities		(465,247	)		(212,038	)		1,031,233			42,976			37,215			434,139
Long-term liabilities:
Long-term debt due after one year		—			1,294,674			(12,433	)		1,745			804			1,284,790
Deferred income taxes		—			(7	)		190,701			5,627			—			196,321
Accrued liabilities		—			—			133,427			614			—			134,041

Total long-term liabilities		—			1,294,667			311,695			7,986			804			1,615,152
Total shareholders' equity		2,243,842			2,110,725			2,985,614			752,674			(5,790,206	)		2,302,649

	$	1,778,595		$	3,193,354		$	4,328,542		$	803,636		$	(5,752,187	)	$	4,351,940

Condensed Consolidating Balance Sheet



As of May 31, 2010 (in thousands)		Cintas Corporation			Corp. 2		Subsidiary Guarantors			Non- Guarantors			Eliminations			Cintas Corporation Consolidated
Assets
Current assets:
Cash and cash equivalents	$	—		$	34,905	$	339,702		$	36,674		$	—		$	411,281
Marketable securities		—			—		21,954			132,852			—			154,806
Accounts receivable, net		—			261,512		74,256			26,451			—			362,219
Inventories, net		—			144,826		16,857			9,420			(1,619	)		169,484
Uniforms and other rental items in service		—			256,398		70,489			25,514			(20,295	)		332,106
Income taxes, current		—			5,306		(591	)		10,976			—			15,691
Deferred tax asset (liability)		—			—		54,474			(2,059	)		—			52,415
Prepaid expenses and other		—			5,565		15,808			1,487			—			22,860

Total current assets		—			708,512		592,949			241,315			(21,914	)		1,520,862
Property and equipment, at cost, net		—			591,040		240,462			63,020			—			894,522
Goodwill		—			—		1,310,675			46,250			—			1,356,925
Service contracts, net		—			98,335		880			4,230			—			103,445
Other assets, net		2,032,649			1,612,270		1,613,514			322,707			(5,487,158	)		93,982

	$	2,032,649		$	3,010,157	$	3,758,480		$	677,522		$	(5,509,072	)	$	3,969,736

Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable	$	(465,247	)	$	164,131	$	343,454		$	(8,614	)	$	38,023		$	71,747
Accrued compensation and related liabilities		—			42,181		21,730			3,013			—			66,924
Accrued liabilities		—			53,432		178,698			13,092			(820	)		244,402
Long-term debt due within one year		—			805		(196	)		—			—			609

Total current liabilities		(465,247	)		260,549		543,686			7,491			37,203			383,682
Long-term liabilities:
Long-term debt due after one year		—			795,541		(10,917	)		—			820			785,444
Deferred income taxes		—			—		145,563			4,997			—			150,560
Accrued liabilities		—			—		115,549			472			—			116,021

Total long-term liabilities		—			795,541		250,195			5,469			820			1,052,025
Total shareholders' equity		2,497,896			1,954,067		2,964,599			664,562			(5,547,095	)		2,534,029

	$	2,032,649		$	3,010,157	$	3,758,480		$	677,522		$	(5,509,072	)	$	3,969,736

Condensed Consolidating Statement of Cash Flows



Year Ended May 31, 2011 (in thousands)					Cintas Corporation			Corp. 2			Subsidiary Guarantors			Non- Guarantors			Eliminations			Cintas Corporation Consolidated
Cash flows from operating activities:
	Net income			$	246,989		$	105,914		$	134,424		$	103,964		$	(344,302	)	$	246,989
	Adjustments to reconcile net income to net cash provided by (used in) operating activities:
		Depreciation			—			103,039			36,032			11,815			—			150,886
		Amortization			—			37,615			543			4,423			—			42,581
		Stock-based compensation			15,203			—			—			—			—			15,203
		Deferred income taxes			—			(4,886	)		51,996			798			—			47,908
		Changes in current assets and liabilities, net of acquisitions of businesses:
			Accounts receivable, net		—			(39,060	)		(2,079	)		(7,847	)		—			(48,986	)
			Inventories, net		—			(59,223	)		(8,112	)		(2,957	)		(8,532	)		(78,824	)
			Uniforms and other rental items in service		—			(45,149	)		(11,671	)		(7,179	)		5,819			(58,180	)
			Prepaid expenses		—			223			2,085			(1,948	)		—			360
			Accounts payable		—			(392,210	)		393,185			28,244			(4	)		29,215
			Accrued compensation and related liabilities		—			12,957			(1,577	)		1,113			—			12,493
			Accrued liabilities		—			(2,740	)		(6,318	)		6,875			16			(2,167	)
			Income taxes, current		—			4,265			(8,858	)		(11,999	)		—			(16,592	)

Net cash provided by (used in) operating activities					262,192			(279,255	)		579,650			125,302			(347,003	)		340,886
Cash flows from investing activities:
	Capital expenditures				—			(99,739	)		(68,274	)		(14,579	)		—			(182,592	)
	Proceeds from sale or redemption of marketable securities				—			—			23,206			115,850			—			139,056
	Purchase of marketable securities and investments				—			(16,897	)		(55,438	)		(61,438	)		55,466			(78,307	)
	Acquisitions of businesses, net of cash acquired				—			(133,378	)		(1,831	)		(36,343	)		—			(171,552	)
	Other, net				253,387			54,296			(504,637	)		(99,797	)		291,553			(5,198	)

Net cash provided by (used in) investing activities					253,387			(195,718	)		(606,974	)		(96,307	)		347,019			(298,593	)
Cash flows from financing activities:
	Proceeds from the issuances of debt				—			1,000,500			1,781			—			—			1,002,281
	Repayment of debt				—			(501,316	)		(876	)		—			(16	)		(502,208	)
	Dividends paid				(71,801	)		—			—			(11	)		—			(71,812	)
	Repurchase of common stock				(443,690	)		—			—			—			—			(443,690	)
	Other				(88	)		(4,576	)		—			55			—			(4,609	)

Net cash (used in) provided by financing activities					(515,579	)		494,608			905			44			(16	)		(20,038	)
Effect of exchange rate changes on cash and cash equivalents					—			417			—			4,153			—			4,570

Net increase (decrease) in cash and cash equivalents					—			20,052			(26,419	)		33,192			—			26,825
Cash and cash equivalents at beginning of period					—			34,905			339,702			36,674			—			411,281

Cash and cash equivalents at end of period				$	—		$	54,957		$	313,283		$	69,866		$	—		$	438,106

Condensed Consolidating Statement of Cash Flows



Year Ended May 31, 2010 (in thousands)					Cintas Corporation			Corp. 2			Subsidiary Guarantors			Non- Guarantors			Eliminations			Cintas Corporation Consolidated
Cash flows from operating activities:
	Net income			$	215,620		$	46,146		$	149,996		$	17,902		$	(214,044	)	$	215,620
	Adjustments to reconcile net income to net cash provided by (used in) operating activities:
		Depreciation			—			105,981			37,149			8,929			—			152,059
		Amortization			—			37,723			879			2,480			—			41,082
		Stock-based compensation			15,349			—			—			—			—			15,349
		Deferred income taxes			—			(1,745	)		12,668			2,372			—			13,295
		Changes in current assets and liabilities, net of acquisitions of businesses:
			Accounts receivable, net		—			21,442			14,594			(2,512	)		(28,302	)		5,222
			Inventories, net		—			49,396			(16,803	)		(913	)		(1,387	)		30,293
			Uniforms and other rental items in service		—			2,379			5,655			(3,681	)		(189	)		4,164
			Prepaid expenses		—			667			3,101			(53	)		—			3,715
			Accounts payable		—			19,707			(70,957	)		43,498			16,691			8,939
			Accrued compensation and related liabilities		—			10,022			7,435			936			—			18,393
			Accrued liabilities		—			2,489			45,418			(417	)		38			47,528
			Income taxes, current		—			(2,134	)		16,455			(4,326	)		—			9,995

Net cash provided by (used in) operating activities					230,969			292,073			205,590			64,215			(227,193	)		565,654
Cash flows from investing activities:
	Capital expenditures				—			(62,236	)		(42,422	)		(6,420	)		—			(111,078	)
	Proceeds from redemption of marketable securities				—			—			8,361			26,351			—			34,712
	Purchase of marketable securities and investments				—			(24,826	)		161,621			(34,137	)		(183,927	)		(81,269	)
	Acquisitions of businesses, net of cash acquired				—			(25,686	)		—			(24,758	)		—			(50,444	)
	Other, net				(156,082	)		(184,047	)		(34,494	)		84			375,036			497

Net cash (used in) provided by investing activities					(156,082	)		(296,795	)		93,066			(38,880	)		191,109			(207,582	)
Cash flows from financing activities:
	Repayment of debt				—			(754	)		(35,933	)		—			36,084			(603	)
	Dividends paid				(73,950	)		—			—			(10	)		—			(73,960	)
	Repurchase of common stock				(969	)		—			—			—			—			(969	)
	Other				32			767			—			(1,776	)		—			(977	)

Net cash (used in) provided by financing activities					(74,887	)		13			(35,933	)		(1,786	)		36,084			(76,509	)
Effect of exchange rate changes on cash and cash equivalents					—			217			—			(244	)		—			(27	)

Net (decrease) increase in cash and cash equivalents					—			(4,492	)		262,723			23,305			—			281,536
Cash and cash equivalents at beginning of period					—			39,397			76,979			13,369			—			129,745

Cash and cash equivalents at end of period				$	—		$	34,905		$	339,702		$	36,674		$	—		$	411,281

Condensed Consolidating Statement of Cash Flows



Year Ended May 31, 2009 (in thousands)					Cintas Corporation			Corp. 2			Subsidiary Guarantors			Non- Guarantors			Eliminations			Cintas Corporation Consolidated
Cash flows from operating activities:
	Net income			$	226,357		$	42,920		$	151,863		$	20,647		$	(215,430	)	$	226,357
	Adjustments to reconcile net income to net cash provided by (used in) operating activities:
		Depreciation			—			111,242			38,289			8,041			—			157,572
		Amortization			—			39,637			1,115			1,782			—			42,534
		Impairment of long-lived assets			—			25,713			18,222			4,953			—			48,888
		Stock-based compensation			11,953			—			—			—			—			11,953
		Deferred income taxes			—			—			1,429			(2,603	)		—			(1,174	)
		Changes in current assets and liabilities, net of acquisitions of businesses:
			Accounts receivable, net		—			37,582			31,432			5,100			(2,965	)		71,149
			Inventories, net		—			23,521			15,843			(517	)		(3,711	)		35,136
			Uniforms and other rental items in service		—			29,220			7,859			(149	)		(7,269	)		29,661
			Prepaid expenses		—			(1,131	)		(3,597	)		(221	)		—			(4,949	)
			Accounts payable		—			(115,841	)		101,999			(13,474	)		2,756			(24,560	)
			Accrued compensation and related liabilities		—			2,141			(3,917	)		(236	)		—			(2,012	)
			Accrued liabilities		—			(11,594	)		(19,038	)		1,579			62			(28,991	)
			Income taxes, current		—			(3,461	)		(28,551	)		(6,030	)		—			(38,042	)

Net cash provided by (used in) operating activities					238,310			179,949			312,948			18,872			(226,557	)		523,522
Cash flows from investing activities:
	Capital expenditures				—			(91,914	)		(59,925	)		(8,253	)		—			(160,092	)
	Proceeds from sale or redemption of marketable securities				—			—			—			116,433			—			116,433
	Purchase of marketable securities and investments				—			1,912			13,691			(122,652	)		(21,353	)		(128,402	)
	Acquisitions of businesses, net of cash acquired				—			(21,561	)		—			(9,348	)		—			(30,909	)
	Other, net				(140,259	)		88,792			(193,727	)		(64	)		245,007			(251	)

Net cash (used in) provided by investing activities					(140,259	)		(22,771	)		(239,961	)		(23,884	)		223,654			(203,221	)
Cash flows from financing activities:
	Proceeds from issuance of debt				—			7,500			—			—			—			7,500
	Repayment of debt				—			(163,693	)		(3,859	)		—			2,903			(164,649	)
	Dividends paid				(72,207	)		—			—			—			—			(72,207	)
	Repurchase of common stock				(25,847	)		—			—			—			—			(25,847	)
	Other				3			767			—			85			—			855

Net cash (used in) provided by financing activities					(98,051	)		(155,426	)		(3,859	)		85			2,903			(254,348	)
Effect of exchange rate changes on cash and cash equivalents					—			173			—			(2,605	)		—			(2,432	)

Net increase (decrease) in cash and cash equivalents					—			1,925			69,128			(7,532	)		—			63,521
Cash and cash equivalents at beginning of period					—			37,472			7,851			20,901			—			66,224

Cash and cash equivalents at end of period				$	—		$	39,397		$	76,979		$	13,369		$	—		$	129,745

- Definition

Text block that encapsulates the detailed table comprising the condensed financial statements (balance sheet, income statement and statement of cash flows), normally using the registrant (parent) as the sole domain member. If condensed consolidating financial statements are being presented, other domain members (in addition to parent) such as guarantor subsidiaries, non-guarantor subsidiaries, and the consolidation eliminations, will be included in order that the respective monetary amounts for each of the domains will aggregate to the respective amounts on the consolidated financial statements. The line items are the various captions used to compile the condensed financial statements. Using extensions, most, if not all, of the elements representing condensed financial statement captions will be the same as those used for the consolidated financial statements captions.

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