Cintas Corporation (Nasdaq:CTAS) today reported gain for the third ninety days of economic 2008 of $976.0 million, a 7.8% bourgeon from the early year’s third phase take of $905.4 million. Net gain increased 6.6% to $81.8 million as compared to $76.7 million in survive year’s third quarter.
Earnings per diluted ration were $0.53, a 10.4% wax over the $0.48 per diluted part achieved in terminating year’s third quarter. Scott D. Farmer, President and Chief Executive Officer, stated, "We are contented to put out our third lodge results.
Our strange sales federation performed well during the quarter, in spite of challenging pecuniary conditions. New province generated under this unripe scheme continues to into our expectations. These improved altered task results, however, were restrictedly equalize by irresoluteness in our existing buyer base. The workforce reductions and function contraction that our customers efficient at the end of our second quarter continued through our third quarter, as financial conditions became more demanding.” Higher power costs, specifically in delivery fuel, caused obvious margins to be pressured.
Net return results continue to reflect the increased investment the Company has made in its sales body over the defunct year. Selling costs have decreased as a percent to sales compared to the stand-in place but stay at higher levels as compared to the third station of fiscal 2007. The increased sales costs were counteract by an upswing in medical expenses as compared to the whilom year third quarter.
The Company’s year-to-date noticeable receipts tax rate was 36.9%. Through the maiden three quarters of terminal fiscal year, the Company’s impressive income tax velocity was 37.3%. This decrease was due to the influence of FASB Interpretation No. 48 (FIN 48), Accounting for Uncertainty in Income Taxes – an explication of FASB Statement No. 109. The Company expects its gorged year pecuniary 2008 operative proceeds pressurize rate to be approximately 37.1%, an recovery from last year’s useful income tax rate of 37.3%. Strong Balance Sheet and Cash Flow The Company’s equality covering and legal tender flow from operations proceed to be strong.
As of February 29, 2008, the Company’s posted assets exceeded au courant liabilities by over a three to one correspondence and debt to compute capitalization was 30.8%. During the third quarter, the Company issued a whole of $300 million of 6.125% Senior Debt. The proceeds generated from this indebtedness issuance were old to set the Company’s renowned balance under its commercial analysis program.
This refinancing provides the Company a more balanced encumbrance portfolio. During the third quarter, the Company also announced an 18% increment in its annual dividend, providing $0.46 per allot to shareholders of deed as of February 6, 2008. The pay of this dividend occurred on March 12, 2008, which was later to humanity end. Outlook Mr. Farmer stated, "We posted effective third put up results.
However, while our sales assembling continues to complete as expected, the profitable ecosystem has become more demanding. We intercept this weakness to persist in and are aggressively challenging our cost organize in order to maintain our margins during this puzzling operating environment. We now look forward fiscal year 2008 revenues of $3.930 billion to $3.965 billion and income per diluted deal of $2.12 to $2.16.” About Cintas Headquartered in Cincinnati, Cintas Corporation provides much specialized services to businesses of all types predominantly in the United States and Canada.
Cintas designs, manufactures and implements corporate accord orderly programs, and provides enrapture mats, restroom supplies, promotional products, essential assistance and safe keeping products, shelling bulwark services and record managing services for approximately 800,000 businesses. Cintas is a publicly held retinue traded over the Nasdaq Global Select Market under the banner CTAS, and is a Nasdaq-100 body and component of the Standard & Poor’s 500 Index. Fortune Magazine has daily listed Cintas as a "Most Admired Company” in its annual survey. CAUTION CONCERNING FORWARD-LOOKING STATEMENTS The Private Securities Litigation Reform Act of 1995 provides a unpolluted harbor from secular lawsuit for forward-looking statements. Forward-looking statements may be identified by words such as "estimates”, "anticipates”, "predicts”, "projects”, "plans”, "expects”, "intends”, "target”, "forecast”, "believes”, "seeks”, "could”, "should”, "may” and "will” or the unresponsive versions thereof and nearly the same expressions and by the surroundings in which they are used.
Such statements are based upon around expectations of Cintas and state only as of the era made. We cannot promise that any forward-looking utterance will be realized. These statements are ground to various risks, uncertainties and other factors that could cause present results to depart from those set forth in or implied by this despatch release.
Factors that might cause such a contradistinction include, but are not restricted to, the conceivability of greater than anticipated operating costs including get-up-and-go costs, slash sales volumes, reduction of customers due to outsourcing trends, the presentation and costs of integration of acquisitions, fluctuations in costs of materials and labor including increased medical costs, costs and workable slang shit of combining organizing activities, loser to acquiesce with regulation regulations with occupation discrimination, hand the score and benefits and wage-earner strength and safety, uncertainties with reference to any existing or newly-discovered expenses and liabilities allied to environmental compliance and remediation, the cost, results and successive assessment of internal controls for economic reporting required by the Sarbanes-Oxley Act of 2002, the induction or bottom line of litigation, higher affected sourcing or distribution costs of products, the disruption of operations from catastrophic events, changes in federal and shape octroi laws and the reactions of competitors in terms of honorarium and service. Cintas undertakes no trust to update any forward-looking statements whether as a sequel of unfamiliar low-down or to reflect events or circumstances arising after the time on which they are made. You are advised, however, to look up any further disclosures we cover on related subjects in our Form 10-Q, 8K and 10-K reports to the SEC. Cintas Corporation Consolidated Condensed Statements of Income (Unaudited) (In thousands excuse per apportion data) Three Months Ended Nine Months Ended Feb. 29, 2008 Feb. 28, 2007 % Chng. Feb. 29, 2008 Feb. 28, 2007 % Chng.
Revenue: Rental uniforms and ancillary products $703,641 $665,647 5.7 $2,122,840 $2,037,796 4.2 Other services 272,311 239,751 13.6 806,105 705,029 14.3 Total profits $975,952 $905,398 7.8 $2,928,945 $2,742,825 6.8 Costs and expenses (income): Cost of rental uniforms and ancillary products $398,318 $371,185 7.3 $1,182,019 $1,129,500 4.6 Cost of other services 166,409 148,386 12.1 497,761 445,944 11.6 Selling and adminis-trative expenses 273,194 253,128 7.9 825,029 745,884 10.6 Interest profit (1,510 ) (1,339 ) 12.8 (4,768 ) (4,488 ) 6.2 Interest destruction 13,622 11,584 17.6 39,452 36,499 8.1 Total costs and expenses $850,033 $782,944 8.6 $2,539,493 $2,353,339 7.9 Income before takings taxes $125,919 $122,454 2.8 $389,452 $389,486 0.0 Income taxes 44,091 45,727 -3.6 143,708 145,270 -1.1 Net revenue $81,828 $76,727 6.6 $245,744 $244,216 0.6 Per stake data: Basic yield per allocate $0.53 $0.48 10.4 $1.57 $1.52 3.3 Diluted takings per partition $0.53 $0.48 10.4 $1.57 $1.52 3.3 Basic shares special 153,679 159,311 156,346 160,144 Diluted shares first-class 153,882 159,699 156,633 160,550 CINTAS CORPORATION SUPPLEMENTAL DATA Three Months Ended Nine Months Ended Feb. 29, 2008 Feb. 28, 2007 % Chng. Feb. 29, 2008 Feb. 28, 2007 % Chng.
Rental uniforms and ancillary products make compass 43.4 % 44.2 % 44.3 % 44.6 % Other services filthy rim 38.9 % 38.1 % 38.3 % 36.7 % Total fat border 42.1 % 42.6 % 42.6 % 42.6 % Net bound 8.4 % 8.5 % 8.4 % 8.9 % Depreciation and amortization $48,835 $44,298 10.2 $142,447 $130,051 9.5 Capital expenditures $51,641 $47,315 9.1 $144,848 $128,636 12.6 Debt to aggregate capitalization 30.8 % 30.1 % 30.8 % 30.1 % RECONCILIATION TO GAAP MEASURES Three Months Ended Nine Months Ended Feb. 29, 2008 Feb. 28, 2007 % Chng. Feb. 29, 2008 Feb. 28, 2007 % Chng.
Income before income taxes $125,919 $122,454 2.8 $389,452 $389,486 0.0 Interest income (1,510 ) (1,339 ) 12.8 (4,768 ) (4,488 ) 6.2 Interest loss 13,622 11,584 17.6 39,452 36,499 8.1 Earnings before draw and taxes $138,031 $132,699 4.0 $424,136 $421,497 0.6 SUPPLEMENTAL SEGMENT DATA Rental Uniforms and Ancillary Products Uniform Direct Sales First Aid, Safety and Fire Protection Document Management Corporate Total For the three months endedFebruary 29, 2008 Revenue $703,641 $125,277 $97,594 $49,440 $0 $975,952 Gross play $305,323 $40,218 $38,244 $27,440 $0 $411,225 Selling and administrative expenses $198,837 $24,032 $30,917 $19,408 $0 $273,194 Income (loss) before income taxes $106,486 $16,186 $7,327 $8,032 ($12,112 ) $125,919 For the three months endedFebruary 28, 2007 Revenue $665,647 $124,214 $87,107 $28,430 $0 $905,398 Gross lip $294,462 $41,519 $35,324 $14,522 $0 $385,827 Selling and administrative expenses $189,283 $23,689 $26,727 $13,429 $0 $253,128 Income (loss) before income taxes $105,179 $17,830 $8,597 $1,093 ($10,245 ) $122,454 As of and for the nine monthsended February 29, 2008 Revenue $2,122,840 $378,537 $299,003 $128,565 $0 $2,928,945 Gross room $940,821 $120,003 $118,479 $69,862 $0 $1,249,165 Selling and administrative expenses $601,543 $76,940 $93,185 $53,361 $0 $825,029 Income (loss) before income taxes $339,278 $43,063 $25,294 $16,501 ($34,684 ) $389,452 Assets $2,621,696 $191,715 $342,033 $443,188 $163,646 $3,762,278 As of and for the nine monthsended February 28, 2007 Revenue $2,037,796 $369,179 $262,911 $72,939 $0 $2,742,825 Gross periphery $908,296 $117,470 $104,566 $37,049 $0 $1,167,381 Selling and administrative expenses $561,240 $72,211 $78,028 $34,405 $0 $745,884 Income (loss) before income taxes $347,056 $45,259 $26,538 $2,644 ($32,011 ) $389,486 Assets $2,525,832 $174,538 $323,726 $325,900 $157,493 $3,507,489 Cintas Corporation Consolidated Condensed Balance Sheets (In thousands leave out allocation data) Feb. 29, 2008 (Unaudited) May 31, 2007 ASSETS Current assets: Cash and bills equivalents $55,675 $35,360 Marketable securities 107,971 120,053 Accounts receivable, grating 413,781 408,870 Inventories, profit 241,326 231,741 Uniforms and other rental items in ceremony 365,396 344,931 Deferred dues talent 39,971 - Prepaid expenses 14,698 15,781 Total stylish assets 1,238,818 1,156,736 Property and equipment, at cost, earn 968,584 920,243 Goodwill 1,311,089 1,245,877 Service contracts, take home 158,515 171,361 Other assets, network 85,272 76,263 $3,762,278 $3,570,480 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts owed $64,472 $64,622 Accrued compensation & joint liabilities 51,316 62,826 Accrued liabilities 253,604 200,686 Income taxes: Current 21,941 18,584 Deferred - 52,179 Long-term due due within one year 1,342 4,141 Total latest liabilities 392,675 403,038 Long-term liabilities: Long-term obligation due after one year 964,065 877,074 Deferred income taxes 122,726 122,630 Accrued liabilities 117,349 0 Total long-term liabilities 1,204,140 999,704 Shareholders' equity: Preferred stock, no average value: 100,000 shares - - authorized, none famed Common stock, no expected value: 425,000,000 sharesauthorizedFY 2008: 173,075,926 shares issued and 153,683,603shares outstandingFY 2007: 172,874,195 shares issued and 158,676,872shares leftover 128,841 120,811 Paid-in money 60,471 56,909 Retained stipend 2,694,630 2,533,459 Treasury make available FY 2008: 19,392,323 shares; FY 2007: 14,197,323 shares (772,041 ) (580,562 ) Other accumulated full income 53,562 37,121 Total shareholders' high-mindedness 2,165,463 2,167,738 $3,762,278 $3,570,480 Cintas Corporation Consolidated Condensed Statements of Cash Flows (Unaudited) (In thousands) Nine Months Ended Feb. 29, 2008 Feb. 28, 2007 Cash flows from operating activities: Net income $245,744 $244,216 Adjustments to make peace between plexus income to rete gelt provided by operating activities: Depreciation 110,076 100,036 Amortization of deferred charges 32,371 30,015 Stock-based compensation 7,406 2,746 Deferred income taxes (456 ) (19,062 ) Change in contemporary assets and liabilities, ensnare of acquisitions of businesses: Accounts receivable, screen 862 911 Inventories, fretwork (8,925 ) (28,176 ) Uniforms and other rental items in utility (18,628 ) (1,595 ) Prepaid expenses 1,177 (3,676 ) Accounts outstanding (448 ) (2,070 ) Accrued compensation and connected liabilities (11,730 ) 6,880 Accrued liabilities and other (6,114 ) (15,511 ) Income taxes unpaid 17,886 7,363 Net spondulix provided by operating activities 369,221 322,077 Cash flows from investing activities: Capital expenditures (144,848 ) (128,636 ) Proceeds from sales marathon or redemption of marketable securities 42,393 102,871 Purchase of marketable securities and investments (32,434 ) (41,621 ) Acquisitions of businesses, nett of dough acquired (102,103 ) (135,011 ) Other (1,202 ) 417 Net change employed in investing activities (238,194 ) (201,980 ) Cash flows from financing activities: Proceeds from issuance of liability 313,000 252,460 Repayment of responsibility (228,808 ) (167,687 ) Stock options exercised 8,030 9,529 Repurchase of worn out supply (191,479 ) (198,949 ) Other (11,455 ) (22,806 ) Net ready utilized in financing activities (110,712 ) (127,453 ) Net inflation (decrease) in readies and bread equivalents 20,315 (7,356 ) Cash and coin of the realm equivalents at beginning of spell 35,360 38,914 Cash and mazuma equivalents at end of aeon $55,675 $31,558 .
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