X
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE
ACT OF 1934 for the Fiscal Year Ended May 31,
2008
|
___
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Incorporated
under the
Laws of Washington
|
IRS
Employer ID
|
|
(State
or other jurisdiction
of incorporation or
organization)
|
No.
31-1188630
|
Title
of each class
|
Name
of each exchange on which registered
|
|
Common
Stock, no par value
|
The
NASDAQ Stock Market LLC
(NASDAQ
Global Select Market)
|
Page
|
Part I | |||
Item
1.
|
Business.
|
4
|
|
Item
1A.
|
Risk
Factors.
|
6
|
|
Item
1B.
|
Unresolved
Staff Comments.
|
9
|
|
Item
2.
|
Properties.
|
10
|
|
Item
3.
|
Legal
Proceedings.
|
11
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders.
|
11
|
Part II | |||
Item
5.
|
Market
for Registrant's Common Equity, Related Stockholder Matters
and Issuer Purchases of
Equity
Securities.
|
12
|
|
Item
6.
|
Selected
Financial Data.
|
15
|
|
Item
7.
|
Management's
Discussion and Analysis of Financial Condition and
Results of Operations.
|
16
|
|
Item
7A.
|
Quantitative
and Qualitative Disclosure About Market Risk.
|
30
|
|
Item
8.
|
Financial
Statements and Supplementary Data.
|
31
|
|
Item
9.
|
Changes
in and Disagreements with Accountants on Accounting and
Financial Disclosure.
|
63
|
|
Item
9A.
|
Controls
and Procedures.
|
63
|
|
Item
9B.
|
Other
Information.
|
63
|
Part III | |||
Item
10.
|
Directors
and Executive Officers of the Registrant.
|
63
|
|
Item
11.
|
Executive
Compensation.
|
63
|
|
Item
12.
|
Security
Ownership of Certain Beneficial Owners and Management
and Related
Stockholder Matters.
|
63
|
|
Item
13.
|
Certain
Relationships and Related Transactions, and Director
Independence.
|
63
|
|
Item
14.
|
Principal
Accountant Fees and Services.
|
63
|
|
Part IV | |||
Item 15. |
Exhibits
and Financial Statement Schedules.
|
64
|
|
·
|
Uniforms
and Apparel
|
|
·
|
Mats,
Mops and Towels
|
|
·
|
Restroom
and Hygiene Service
|
|
·
|
First
Aid
|
|
·
|
Safety
|
|
·
|
Fire
Protection
|
|
·
|
Branded
Promotional Products
|
|
·
|
Document
Shredding and Storage
|
|
·
|
Cleanroom
Resources
|
|
·
|
Flame
Resistant Clothing
|
Year
Ended May 31, (in thousands)
|
2008
|
2007
|
2006
|
|||||||||
Rental
Uniforms and Ancillary Products
|
$ | 2,834,568 | $ | 2,734,629 | $ | 2,568,776 | ||||||
Uniform
Direct Sales
|
517,490 | 501,443 | 484,934 | |||||||||
First
Aid, Safety and Fire Protection Services
|
403,552 | 362,417 | 285,348 | |||||||||
Document
Management Services
|
182,290 | 108,411 | 64,550 | |||||||||
$ | 3,937,900 | $ | 3,706,900 | $ | 3,403,608 |
Type
of Facility
|
#
of Facilities
|
|||
Rental
Processing Plants
|
176 | |||
Rental
Branches
|
94 | |||
First
Aid, Safety and Fire Protection Facilities
|
59 | |||
Document
Management Facilities
|
49 | |||
Distribution
Centers
|
8 | * | ||
Manufacturing
Facilities
|
10 | |||
Direct
Sales Offices
|
17 | |||
Total
|
413 |
Fiscal
2008
|
||||||||
Quarter
Ended
|
High
|
Low
|
||||||
May
2008
|
$ | 31.01 | $ | 27.74 | ||||
February
2008
|
34.75 | 28.78 | ||||||
November
2007
|
38.00 | 31.79 | ||||||
August
2007
|
40.90 | 35.37 |
Fiscal
2007
|
||||||||
Quarter
Ended
|
High
|
Low
|
||||||
May
2007
|
$ | 40.51 | $ | 35.95 | ||||
February
2007
|
42.81 | 39.71 | ||||||
November
2006
|
43.63 | 37.39 | ||||||
August
2006
|
42.54 | 34.92 |
Years
Ended May 31,
|
1998
|
1999
|
2000
|
2001
|
2002
|
2003
|
2004
|
2005
|
2006
|
2007
|
2008
|
10-Year
Compd Growth
|
||||||||||||||||||||||||||||
Revenue
|
$ | 1,476,945 | 1,751,568 | 1,901,991 | 2,160,700 | 2,271,052 | 2,686,585 | 2,814,059 | 3,067,283 | 3,403,608 | 3,706,900 | 3,937,900 | 10.3% | (3) | ||||||||||||||||||||||||||
Net
Income
|
$ | 130,797 | 136,796 | 190,386 | 218,665 | 229,466 | 243,191 | 265,078 | 292,547 | 323,382 | 334,538 | 335,405 | 9.9% | |||||||||||||||||||||||||||
Pro
Forma Net Income (1)
|
$ | 125,847 | 136,796 | 190,386 | 218,665 | 229,466 | 243,191 | 265,078 | 292,547 | 323,382 | 334,538 | 335,405 | 10.3% | |||||||||||||||||||||||||||
Basic
EPS
|
$ | 0.81 | 0.83 | 1.14 | 1.30 | 1.35 | 1.43 | 1.55 | 1.70 | 1.93 | 2.09 | 2.15 | 10.3% | |||||||||||||||||||||||||||
Diluted
EPS
|
$ | 0.80 | 0.81 | 1.12 | 1.27 | 1.33 | 1.41 | 1.54 | 1.69 | 1.92 | 2.09 | 2.15 | 10.4% | |||||||||||||||||||||||||||
Pro
Forma Basic EPS (1)
|
$ | 0.78 | 0.83 | 1.14 | 1.30 | 1.35 | 1.43 | 1.55 | 1.70 | 1.93 | 2.09 | 2.15 | 10.7% | |||||||||||||||||||||||||||
Pro Forma Diluted EPS
(1)
|
$ | 0.77 | 0.81 | 1.12 | 1.27 | 1.33 | 1.41 | 1.54 | 1.69 | 1.92 | 2.09 | 2.15 | 10.8% | |||||||||||||||||||||||||||
Dividends
Per Share
|
$ | 0.12 | 0.15 | 0.19 | 0.22 | 0.25 | 0.27 | 0.29 | 0.32 | 0.35 | 0.39 | 0.46 | 14.4% | |||||||||||||||||||||||||||
Total
Assets
|
$ | 1,305,400 | 1,407,818 | 1,581,342 | 1,752,224 | 2,519,234 | 2,582,946 | 2,810,297 | 3,059,744 | 3,425,237 | 3,570,480 | 3,808,601 | 11.3% | |||||||||||||||||||||||||||
Shareholders’
Equity
|
$ | 756,799 | 871,433 | 1,042,896 | 1,231,346 | 1,423,814 | 1,646,418 | 1,888,093 | 2,104,574 | 2,090,192 | 2,167,738 | 2,254,131 | 11.5% | |||||||||||||||||||||||||||
Return on Average
Equity (2)
|
17.9% | 16.8% | 19.9% | 19.2% | 17.3% | 15.8% | 15.0% | 14.7% | 15.4% | 15.7% | 15.2% | |||||||||||||||||||||||||||||
Long-Term
Debt
|
$ | 307,633 | 283,581 | 254,378 | 220,940 | 703,250 | 534,763 | 473,685 | 465,291 | 794,454 | 877,074 | 942,736 |
(1)
|
Results
for 1998 were adjusted on a pro forma basis to reflect the true tax impact
of Uniforms To You as if it had been reported as a C Corporation prior to
the merger with Cintas.
|
(2)
|
Return
on average equity using pro forma net income. Return on average
equity is computed as net income divided by the average of shareholders’
equity. We believe that this calculation gives management and
shareholders a good indication of Cintas’ historical
performance.
|
(3)
|
Represents
the 10-year compound annual growth rate based on revenue as restated for
pooling of interests transactions noted
above.
|
2008
|
2007
|
2006
|
||||||||||
Revenue:
|
||||||||||||
Rental Uniforms and Ancillary
Products
|
72.0% | 73.8% | 75.5% | |||||||||
Uniform Direct
Sales
|
13.1% | 13.5% | 14.2% | |||||||||
First Aid, Safety and Fire
Protection Services
|
10.3% | 9.8% | 8.4% | |||||||||
Document Management
Services
|
4.6% | 2.9% | 1.9% | |||||||||
Total
revenue
|
100.0% | 100.0% | 100.0% | |||||||||
Cost
of sales:
|
||||||||||||
Rental Uniforms and Ancillary
Products
|
55.8% | 55.4% | 54.8% | |||||||||
Uniform Direct
Sales
|
67.5% | 68.0% | 69.9% | |||||||||
First Aid, Safety and Fire
Protection Services
|
60.1% | 60.1% | 60.3% | |||||||||
Document Management
Services
|
45.4% | 47.6% | 47.5% | |||||||||
Total
cost of sales
|
57.3% | 57.3% | 57.3% | |||||||||
Gross
margin:
|
||||||||||||
Rental Uniforms and Ancillary
Products
|
44.2% | 44.6% | 45.2% | |||||||||
Uniform Direct
Sales
|
32.5% | 32.0% | 30.1% | |||||||||
First Aid, Safety and Fire
Protection Services
|
39.9% | 39.9% | 39.7% | |||||||||
Document Management
Services
|
54.6% | 52.4% | 52.5% | |||||||||
Total
gross margin
|
42.7% | 42.7% | 42.7% | |||||||||
Selling
and administrative expenses
|
28.0% | 27.1% | 26.8% | |||||||||
Interest
income
|
-0.1% | -0.2% | -0.2% | |||||||||
Interest
expense
|
1.3% | 1.4% | 0.9% | |||||||||
Income
before income taxes
|
13.5% | 14.4% | 15.2% |
Payments
Due by Period
|
||||||||||||||||||||
(In
thousands)
|
Total
|
One
year
or
less
|
Two
to
three
years
|
Four
to
five
years
|
After
five
years
|
|||||||||||||||
Long-term
debt
(1)
|
$ | 942,657 | $ | 535 | $ | 164,177 | $ | 226,278 | $ | 551,667 | ||||||||||
Capital
lease obligations (2)
|
1,149 | 535 | 255 | 240 | 119 | |||||||||||||||
Operating
leases
(3)
|
91,228 | 24,241 | 35,239 | 18,034 | 13,714 | |||||||||||||||
Interest
payments
(4)
|
711,152 | 53,339 | 105,373 | 84,540 | 467,900 | |||||||||||||||
Interest
swap agreements (5)
|
— | — | — | — | — | |||||||||||||||
Unconditional
purchase obligations
|
— | — | — | — | — | |||||||||||||||
Total
contractual cash obligations
|
$ | 1,746,186 | $ | 78,650 | $ | 305,044 | $ | 329,092 | $ | 1,033,400 |
(1)
|
Long-term
debt primarily consists of $775,000 in long-term notes and $163,000 in
commercial paper. Reference Note 5 entitled Long-Term Debt of
“Notes to Consolidated Financial Statements” for a detailed discussion of
long-term debt.
|
(2)
|
Capital
lease obligations are included in long-term debt detailed in Note 5
entitled Long-Term Debt of “Notes to Consolidated Financial
Statements.”
|
(3)
|
Operating
leases consist primarily of building leases and a synthetic lease on a
corporate aircraft.
|
(4)
|
Interest
payments include interest on both fixed and variable rate
debt. Rates have been assumed to remain constant in fiscal
2009, increase 25 basis points for both fiscal 2010 and fiscal 2011, and
an additional 50 basis points in each future year.
|
(5)
|
Reference
Note 5 entitled Long-Term Debt of “Notes to Consolidated Financial
Statements” for a detailed discussion of interest swap
agreements.
|
Amount
of Commitment Expiration per Period
|
||||||||||||||||||||
(In
thousands)
|
Total
|
One
year
or
less
|
Two
to
three
years
|
Four
to
five
years
|
After
five
years
|
|||||||||||||||
Lines
of credit
(1)
|
$ | 600,000 | $ | — | $ | 600,000 | $ | — | $ | — | ||||||||||
Standby
letters of credit (2)
|
74,764 | 45,728 | 29,036 | — | — | |||||||||||||||
Guarantees
|
— | — | — | — | — | |||||||||||||||
Standby
repurchase obligations
|
— | — | — | — | — | |||||||||||||||
Other
commercial commitments
|
— | — | — | — | — | |||||||||||||||
Total
commercial commitments
|
$ | 674,764 | $ | 45,728 | $ | 629,036 | $ | — | $ | — |
(1)
|
Back-up
facility for the commercial paper program (reference Note 5 entitled
Long-Term Debt of “Notes to Consolidated Financial Statements” for further
discussion).
|
(2)
|
Support
certain outstanding debt (reference Note 5 entitled Long-Term Debt of
“Notes to Consolidated Financial Statements”), self-insured workers'
compensation and general liability insurance
programs.
|
Management’s
Report on Internal Control over Financial
Reporting.................................................................................................................
|
32
|
|
Reports
of Ernst & Young LLP, Independent Registered Public Accounting
Firm..........................................................................................
|
33
|
|
Consolidated
Statements of
Income.........................................................................................................................................................................
|
35
|
|
Consolidated
Balance
Sheets....................................................................................................................................................................................
|
36
|
|
Consolidated
Statements of Shareholders’
Equity................................................................................................................................................
|
37
|
|
Consolidated
Statements of Cash
Flows.................................................................................................................................................................
|
38
|
|
Notes
to Consolidated Financial
Statements..........................................................................................................................................................
|
39
|
|
/s/
|
Scott D. Farmer | |
Scott D. Farmer | |||
President and Chief Executive Officer | |||
|
/s/
|
William C. Gale | |
William C. Gale | |||
Senior Vice President and Chief Financial Officer | |||
Years
Ended May 31,
|
||||||||||||
(In
thousands except per share data)
|
2008
|
2007
|
2006
|
|||||||||
Revenue:
|
||||||||||||
Rental uniforms and
ancillary products
|
$ | 2,834,568 | $ | 2,734,629 | $ | 2,568,776 | ||||||
Other
services
|
1,103,332 | 972,271 | 834,832 | |||||||||
3,937,900 | 3,706,900 | 3,403,608 | ||||||||||
Costs
and expenses (income):
|
||||||||||||
Cost of rental
uniforms and ancillary products
|
1,581,618 | 1,515,185 | 1,406,829 | |||||||||
Cost of other
services
|
674,682 | 610,360 | 541,987 | |||||||||
Selling and
administrative expenses
|
1,104,145 | 1,003,958 | 911,750 | |||||||||
Operating
income
|
577,455 | 577,397 | 543,042 | |||||||||
Interest
income
|
(6,072 | ) | (6,480 | ) | (6,759 | ) | ||||||
Interest
expense
|
52,823 | 50,324 | 31,782 | |||||||||
Income
before income
taxes
|
530,704 | 533,553 | 518,019 | |||||||||
Income
taxes
|
195,299 | 199,015 | 194,637 | |||||||||
Net
income
|
$ | 335,405 | $ | 334,538 | $ | 323,382 | ||||||
Basic
earnings per
share
|
$ | 2.15 | $ | 2.09 | $ | 1.93 | ||||||
Diluted
earnings per
share
|
$ | 2.15 | $ | 2.09 | $ | 1.92 | ||||||
Dividends
declared and paid per share
|
$ | 0.46 | $ | 0.39 | $ | 0.35 |
As
of May 31,
|
||||||||
(In
thousands except share data)
|
2008
|
2007
|
||||||
Assets
|
||||||||
Current
assets:
|
||||||||
Cash
and cash
equivalents
|
$ | 66,224 | $ | 35,360 | ||||
Marketable
securities
|
125,471 | 120,053 | ||||||
Accounts receivable,
principally trade, less allowance of $13,139
and $14,486, respectively
|
430,078 | 408,870 | ||||||
Inventories,
net
|
238,669 | 231,741 | ||||||
Uniforms
and other rental items in
service
|
370,416 | 344,931 | ||||||
Deferred
tax
asset
|
39,410 | — | ||||||
Prepaid
expenses
|
12,068 | 15,781 | ||||||
Total
current
assets
|
1,282,336 | 1,156,736 | ||||||
Property
and equipment, at cost,
net
|
974,575 | 920,243 | ||||||
Goodwill
|
1,315,569 | 1,245,877 | ||||||
Service
contracts,
net
|
152,757 | 171,361 | ||||||
Other
assets,
net
|
83,364 | 76,263 | ||||||
$ | 3,808,601 | $ | 3,570,480 | |||||
Liabilities
and Shareholders' Equity
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ | 94,755 | $ | 64,622 | ||||
Accrued
compensation and related
liabilities
|
50,605 | 62,826 | ||||||
Accrued
liabilities
|
207,925 | 200,686 | ||||||
Income
taxes:
|
||||||||
Current
|
12,887 | 18,584 | ||||||
Deferred
|
— | 52,179 | ||||||
Long-term
debt due within one
year
|
1,070 | 4,141 | ||||||
Total
current
liabilities
|
367,242 | 403,038 | ||||||
Long-term
liabilities:
|
||||||||
Long-term
debt due within one
year
|
942,736 | 877,074 | ||||||
Deferred
income
taxes
|
124,184 | 122,630 | ||||||
Accrued
liabilities
|
120,308 | — | ||||||
Total
long-term
liabilities
|
1,187,228 | 999,704 | ||||||
Shareholders'
equity:
|
||||||||
Preferred
stock, no par value:
100,000
shares authorized, none outstanding
|
— | — | ||||||
Common stock, no par
value:
425,000,000 shares
authorized
2008: 173,083,426
shares issued and 153,691,103 shares
outstanding
2007:
172,874,195 shares issued and 158,676,872 shares
outstanding
|
129,182 | 120,811 | ||||||
Paid-in
capital
|
60,408 | 56,909 | ||||||
Retained
earnings
|
2,784,302 | 2,533,459 | ||||||
Treasury
stock:
2008:
19,392,323 shares
2007:
14,197,323 shares
|
(772,041 | ) | (580,562 | ) | ||||
Other
accumulated comprehensive income (loss):
|
||||||||
Foreign
currency
translation
|
61,206 | 41,815 | ||||||
Unrealized
loss on
derivatives
|
(8,815 | ) | (4,421 | ) | ||||
Unrealized
loss on available-for-sale
securities
|
(111 | ) | (273 | ) | ||||
Total
shareholders'
equity
|
2,254,131 | 2,167,738 | ||||||
$ | 3,808,601 | $ | 3,570,480 |
Consolidated
Statements
of Shareholders’ Equity
|
(In
thousands)
|
Common
Stock
|
Paid-In
Capital
|
Retained
Earnings
|
Other
Accumulated
Comprehensive
Income
(Loss)
|
Total
Shareholders’
Equity
|
|||
Treasury
Stock
|
||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Balance
at June 1, 2005
|
172,128 | $ | 95,546 | $ | 58,631 | $ | 1,996,425 | $ | 12,176 | (1,469 | ) | $ | (58,204 | ) | $ | 2,104,574 | ||||||||||||||||
Net
income
|
— | — | — | 323,382 | — | — | — | 323,382 | ||||||||||||||||||||||||
Equity adjustment
for foreign
currency translation
|
— | — | — | — | 20,882 | — | — | 20,882 | ||||||||||||||||||||||||
Change in fair value
of
derivatives,
net of $5,985 of
tax
|
— | — | — | — | 10,481 | — | — | 10,481 | ||||||||||||||||||||||||
Change
in fair value of
available-for-sale securities,
net of ($674)
of tax
|
— | — | — | — | (1,155 | ) | — | — | (1,155 | ) | ||||||||||||||||||||||
Comprehensive
income,
net
of tax
|
353,590 | |||||||||||||||||||||||||||||||
Dividends
|
— | — | — | (58,823 | ) | — | — | — | (58,823 | ) | ||||||||||||||||||||||
Effects of
acquisitions
|
— | — | — | (67 | ) | — | — | — | (67 | ) | ||||||||||||||||||||||
Stock-based
compensation
|
— | — | 5,277 | — | — | — | — | 5,277 | ||||||||||||||||||||||||
Stock options
exercised,
net
of shares surrendered
|
443 | 14,402 | (5,352 | ) | — | — | — | — | 9,050 | |||||||||||||||||||||||
Repurchase
of common stock
|
— | — | — | — | — | (7,920 | ) | (323,409 | ) | (323,409 | ) | |||||||||||||||||||||
Balance
at May 31, 2006
|
172,571 | 109,948 | 58,556 | 2,260,917 | 42,384 | (9,389 | ) | (381,613 | ) | 2,090,192 | ||||||||||||||||||||||
Net
income
|
— | — | — | 334,538 | — | — | — | 334,538 | ||||||||||||||||||||||||
Equity adjustment
for foreign
currency translation
|
— | — | — | — | 7,426 | — | — | 7,426 | ||||||||||||||||||||||||
Change in fair value
of
derivatives,
net of $8,196 of
tax
|
— | — | — | — | (13,571 | ) | — | — | (13,571 | ) | ||||||||||||||||||||||
Change in fair value of
available-for-sale
securities,
net
of $522 of
tax
|
— | — | — | — | 882 | — | — | 882 | ||||||||||||||||||||||||
Comprehensive
income,
net
of tax
|
329,275 | |||||||||||||||||||||||||||||||
Dividends
|
— | — | — | (61,996 | ) | — | — | — | (61,996 | ) | ||||||||||||||||||||||
Stock-based
compensation
|
— | — | 4,500 | — | — | — | — | 4,500 | ||||||||||||||||||||||||
Stock options
exercised,
net
of shares surrendered
|
303 | 10,863 | (6,147 | ) | — | — | — | — | 4,716 | |||||||||||||||||||||||
Repurchase
of common stock
|
— | — | — | — | — | (4,808 | ) | (198,949 | ) | (198,949 | ) | |||||||||||||||||||||
Balance
at May 31, 2007
|
172,874 | 120,811 | 56,909 | 2,533,459 | 37,121 | (14,197 | ) | (580,562 | ) | 2,167,738 | ||||||||||||||||||||||
Net
income
|
— | — | — | 335,405 | — | — | — | 335,405 | ||||||||||||||||||||||||
Equity adjustment
for foreign
currency translation
|
— | — | — | — | 19,391 | — | — | 19,391 | ||||||||||||||||||||||||
Change in fair value
of
derivatives,
net of $2,924 of
tax
|
— | — | — | — | (4,394 | ) | — | — | (4,394 | ) | ||||||||||||||||||||||
Change
in fair value of
available-for-sale securities,
net
of $98 of
tax
|
— | — | — | — | 162 | — | — | 162 | ||||||||||||||||||||||||
Comprehensive
income,
net
of tax
|
350,564 | |||||||||||||||||||||||||||||||
FIN 48
adjustment
|
— | — | — | (13,731 | ) | — | — | — | (13,731 | ) | ||||||||||||||||||||||
Dividends
|
— | — | — | (70,831 | ) | — | — | — | (70,831 | ) | ||||||||||||||||||||||
Stock-based
compensation
|
— | — | 7,456 | — | — | — | — | 7,456 | ||||||||||||||||||||||||
Stock options
exercised,
net
of shares surrendered
|
209 | 8,371 | (3,957 | ) | — | — | — | — | 4,414 | |||||||||||||||||||||||
Repurchase of common stock | — | — | — |
—
|
— | (5,195 | ) | (191,479 | ) | (191,479 | ) | |||||||||||||||||||||
Balance
at May 31, 2008
|
173,083 | $ | 129,182 | $ | 60,408 | $ | 2,784,302 | $ | 52,280 | (19,392 | ) | $ | (772,041 | ) | $ | 2,254,131 |
Years
Ended May 31,
|
||||||||||||
(In
thousands)
|
2008
|
2007
|
2006
|
|||||||||
Cash
flows from operating activities:
|
||||||||||||
Net
income
|
$ | 335,405 | $ | 334,538 | $ | 323,382 | ||||||
Adjustments to
reconcile net income to net cash provided by operating activities:
|
||||||||||||
Depreciation
|
148,566 | 135,181 | 127,117 | |||||||||
Amortization
of deferred charges
|
43,337 | 40,745 | 33,536 | |||||||||
Stock-based
compensation
|
7,456 | 4,500 | 4,725 | |||||||||
Deferred income
taxes
|
1,663 | (332 | ) | (52 | ) | |||||||
Change in
current assets and liabilities, net of acquisitions of businesses:
|
||||||||||||
Accounts
receivable
|
(14,939 | ) | (11,460 | ) | (44,154 | ) | ||||||
Inventories
|
(6,100 | ) | (32,090 | ) | 22,033 | |||||||
Uniforms and other
rental items in service
|
(23,854 | ) | (6,968 | ) | (26,683 | ) | ||||||
Prepaid
expenses
|
3,830 | (4,502 | ) | (2,305 | ) | |||||||
Accounts
payable
|
30,567 | (7,654 | ) | 2,329 | ||||||||
Accrued
compensation and related liabilities
|
(12,430 | ) | 12,600 | 11,424 | ||||||||
Accrued liabilities
and other
|
22,201 | 9,981 | (1,905 | ) | ||||||||
Income taxes
payable
|
8,841 | (25,148 | ) | 11,578 | ||||||||
Net
cash provided by operating activities
|
544,543 | 449,391 | 461,025 | |||||||||
Cash
flows from investing activities:
|
||||||||||||
Capital
expenditures
|
(190,333 | ) | (180,824 | ) | (156,632 | ) | ||||||
Proceeds from sale
or redemption of marketable securities
|
45,791 | 118,174 | 87,477 | |||||||||
Purchase of
marketable securities and investments
|
(54,498 | ) | (48,515 | ) | (31,932 | ) | ||||||
Acquisitions of
businesses, net of cash acquired
|
(111,535 | ) | (160,707 | ) | (346,363 | ) | ||||||
Other
|
(400 | ) | (1,836 | ) | 7,404 | |||||||
Net
cash used in investing activities
|
(310,975 | ) | (273,708 | ) | (440,046 | ) | ||||||
Cash
flows from financing activities:
|
||||||||||||
Proceeds from
issuance of debt
|
295,000 | 252,460 | 333,500 | |||||||||
Repayment of
debt
|
(232,409 | ) | (169,987 | ) | (7,303 | ) | ||||||
Stock options
exercised
|
8,371 | 10,863 | 14,402 | |||||||||
Dividends
paid
|
(70,831 | ) | (61,996 | ) | (58,823 | ) | ||||||
Repurchase of
common stock
|
(191,479 | ) | (198,949 | ) | (323,409 | ) | ||||||
Other
|
(11,356 | ) | (11,628 | ) | 16,372 | |||||||
Net
cash used in financing activities
|
(202,704 | ) | (179,237 | ) | (25,261 | ) | ||||||
Net
increase (decrease) in cash and cash equivalents
|
30,864 | (3,554 | ) | (4,282 | ) | |||||||
Cash
and cash equivalents at beginning of year
|
35,360 | 38,914 | 43,196 | |||||||||
Cash
and cash equivalents at end of year
|
$ | 66,224 | $ | 35,360 | $ | 38,914 |
1.
|
Significant Accounting
Policies
|
Buildings
|
30
to 40
|
Building
improvements
|
5
to 20
|
Equipment
|
3
to 10
|
Leasehold
improvements
|
2
to 5
|
2008
|
2007
|
|||||||||||||||
Cost
|
Estimated
Fair
Value
|
Cost
|
Estimated
Fair
Value
|
|||||||||||||
Obligations
of state and political subdivisions
|
$ | — | $ | — | $ | 24,480 | $ | 24,415 | ||||||||
U.S.
government agency securities
|
— | — | 12,336 | 12,231 | ||||||||||||
Canadian
treasury securities
|
125,626 | 125,471 | 76,995 | 76,753 | ||||||||||||
Other
debt securities
|
— | — | 6,665 | 6,654 | ||||||||||||
$ | 125,626 | $ | 125,471 | $ | 120,476 | $ | 120,053 |
2008
|
2007
|
|||||||
Land
|
$ | 94,539 | $ | 79,572 | ||||
Buildings
and
improvements
|
462,799 | 438,680 | ||||||
Equipment
|
1,029,048 | 884,574 | ||||||
Leasehold
improvements
|
16,700 | 13,171 | ||||||
Construction
in
progress
|
104,704 | 99,195 | ||||||
1,707,790 | 1,515,192 | |||||||
Less:
accumulated
depreciation
|
733,215 | 594,949 | ||||||
$ | 974,575 | $ | 920,243 |
Goodwill
|
Rental
Uniforms
&
Ancillary
Products
|
Uniform
Direct
Sales
|
First
Aid,
Safety
&
Fire
Protection
|
Document
Management
|
Total
|
|||||||||||||||
Balance
as of June 1, 2006
|
$ | 855,135 | $ | 23,862 | $ | 137,917 | $ | 119,261 | $ | 1,136,175 | ||||||||||
Goodwill
acquired
|
7,697 | — | 24,104 | 77,264 | 109,065 | |||||||||||||||
Foreign
currency translation
|
487 | 21 | — | 129 | 637 | |||||||||||||||
Balance
as of May 31, 2007
|
863,319 | 23,883 | 162,021 | 196,654 | 1,245,877 | |||||||||||||||
Goodwill
(adj.) acquired
|
(1,034 | ) | — | 3,523 | 64,808 | 67,297 | ||||||||||||||
Foreign
currency translation
|
1,296 | 73 | — | 1,026 | 2,395 | |||||||||||||||
Balance
as of May 31, 2008
|
$ | 863,581 | $ | 23,956 | $ | 165,544 | $ | 262,488 | $ | 1,315,569 |
Service
Contracts
|
Rental
Uniforms
&
Ancillary
Products
|
Uniform
Direct
Sales
|
First
Aid,
Safety
&
Fire
Protection
|
Document
Management
|
Total
|
|||||||||||||||
Balance
as of June 1, 2006
|
$ | 121,455 | $ | 1,076 | $ | 42,761 | $ | 14,673 | $ | 179,965 | ||||||||||
Service
contracts acquired
|
3,936 | — | 8,147 | 10,550 | 22,633 | |||||||||||||||
Service
contracts amortization
|
(21,759 | ) | (388 | ) | (5,556 | ) | (4,222 | ) | (31,925 | ) | ||||||||||
Foreign
currency translation
|
653 | 11 | — | 24 | 688 | |||||||||||||||
Balance
as of May 31, 2007
|
104,285 | 699 | 45,352 | 21,025 | 171,361 | |||||||||||||||
Service
contracts (adj.) acquired
|
(19 | ) | — | 2,682 | 11,227 | 13,890 | ||||||||||||||
Service
contracts amortization
|
(21,510 | ) | (401 | ) | (6,090 | ) | (6,502 | ) | (34,503 | ) | ||||||||||
Foreign
currency translation
|
1,818 | 30 | — | 161 | 2,009 | |||||||||||||||
Balance
as of May 31, 2008
|
$ | 84,574 | $ | 328 | $ | 41,944 | $ | 25,911 | $ | 152,757 |
As
of May 31, 2008
|
||||||||||||
Carrying
Amount
|
Accumulated
Amortization
|
Net
|
||||||||||
Service
contracts
|
$ | 333,543 | $ | 180,786 | $ | 152,757 | ||||||
Noncompete
and consulting agreements
|
$ | 63,894 | $ | 34,625 | $ | 29,269 | ||||||
Investments
|
46,012 | — | 46,012 | |||||||||
Other
|
10,790 | 2,707 | 8,083 | |||||||||
Total
|
$ | 120,696 | $ | 37,332 | $ | 83,364 |
As
of May 31, 2007
|
||||||||||||
Carrying
Amount
|
Accumulated
Amortization
|
Net
|
||||||||||
Service
contracts
|
$ | 317,644 | $ | 146,283 | $ | 171,361 | ||||||
Noncompete
and consulting agreements
|
$ | 58,218 | $ | 24,123 | $ | 34,095 | ||||||
Investments
|
35,264 | — | 35,264 | |||||||||
Other
|
8,967 | 2,063 | 6,904 | |||||||||
Total
|
$ | 102,449 | $ | 26,186 | $ | 76,263 |
5.
|
Long-Term
Debt
|
2008
|
2007
|
|||||||
Unsecured
term notes due through 2036 at an average
rate of 6.11%
|
$ | 779,652 | $ | 705,147 | ||||
Unsecured
notes due through 2009 at an average
rate of 2.19%
|
163,005 | 170,866 | ||||||
Industrial
development revenue bonds
|
— | 3,441 | ||||||
Other
|
1,149 | 1,761 | ||||||
943,806 | 881,215 | |||||||
Less:
amounts due within one year
|
1,070 | 4,141 | ||||||
$ | 942,736 | $ | 877,074 |
6.
|
Leases
|
7.
|
Income
Taxes
|
2008
|
2007
|
2006
|
||||||||||
Income
before income taxes consist of the following
components:
|
||||||||||||
U.S.
operations
|
$ | 476,279 | $ | 488,011 | $ | 479,427 | ||||||
Foreign
operations
|
54,425 | 45,542 | 38,592 | |||||||||
$ | 530,704 | $ | 533,553 | $ | 518,019 |
2008
|
2007
|
2006
|
||||||||||
Income
taxes consist of the following
components:
|
||||||||||||
Current:
|
||||||||||||
Federal
|
$ | 171,927 | $ | 184,363 | $ | 180,697 | ||||||
State and
local
|
17,225 | 16,181 | 15,026 | |||||||||
189,152 | 200,544 | 195,723 | ||||||||||
Deferred
|
6,147 | (1,529 | ) | (1,086 | ) | |||||||
$ | 195,299 | $ | 199,015 | $ | 194,637 |
2008
|
2007
|
2006
|
||||||||||
Reconciliation of
income tax expense using
the statutory rate and actual income
tax
expense
is as follows:
|
||||||||||||
Income
taxes at the U.S. federal statutory
rate
|
$ | 185,746 | $ | 186,744 | $ | 182,635 | ||||||
State
and local income taxes, net of federal
benefit
|
12,832 | 10,602 | 11,917 | |||||||||
Other
|
(3,279 | ) | 1,669 | 85 | ||||||||
$ | 195,299 | $ | 199,015 | $ | 194,637 |
2008
|
2007
|
|||||||
Deferred
tax assets:
|
||||||||
Employee
benefits
|
$ | 8,100 | $ | 6,195 | ||||
Allowance for
doubtful
accounts
|
4,589 | 5,100 | ||||||
Inventory
obsolescence
|
8,793 | 9,735 | ||||||
Insurance and
contingencies
|
10,753 | 10,222 | ||||||
Other
|
16,820 | 11,909 | ||||||
49,055 | 43,161 | |||||||
Deferred
tax liabilities:
|
||||||||
In service
inventory
|
8,248 | 88,838 | ||||||
Property
|
66,339 | 69,189 | ||||||
Intangibles
|
51,993 | 45,233 | ||||||
Other
|
1,187 | 1,231 | ||||||
State
taxes
|
6,062 | 13,479 | ||||||
133,829 | 217,970 | |||||||
Net
deferred tax
liability
|
$ | 84,774 | $ | 174,809 |
Balance
at June 1, 2007
|
$ | 112,658 | ||
Additions
based on tax positions related to the current year
|
1,554 | |||
Additions
for tax positions of prior years
|
4,465 | |||
Reductions
for tax positions of prior years
|
— | |||
Settlements
|
(87 | ) | ||
Statute
expirations
|
(3,261 | ) | ||
Balance
at May 31, 2008
|
$ | 115,329 |
8.
|
Acquisitions
|
2008
|
2007
|
|||||||
Fair
value of tangible assets
acquired
|
$ | 13,587 | $ | 20,375 | ||||
Fair
value of goodwill acquired
|
67,758 | 109,065 | ||||||
Fair
value of service contracts acquired
|
13,596 | 22,271 | ||||||
Fair
value of other intangibles acquired
|
5,429 | 13,149 | ||||||
Total
fair value of assets acquired
|
100,370 | 164,860 | ||||||
Fair
value of liabilities assumed and incurred
|
(11,165 | ) | 3,288 | |||||
Total
cash paid for acquisitions
|
$ | 111,535 | $ | 161,572 |
9.
|
Defined Contribution
Plans
|
10.
|
Earnings per
Share
|
2008
|
2007
|
2006
|
||||||||||
Numerator:
|
||||||||||||
Net
income
|
$ | 335,405 | $ | 334,538 | $ | 323,382 | ||||||
Denominator:
|
||||||||||||
Denominator
for basic earnings per share – weighted average shares
(000's)
|
155,678 | 159,769 | 167,951 | |||||||||
Effect
of dilutive securities – employee stock options
(000's)
|
252 | 418 | 594 | |||||||||
Denominator
for diluted earnings per share – adjusted weighted average
shares
and
assumed conversions (000's)
|
155,930 | 160,187 | 168,545 | |||||||||
Basic
earnings per
share
|
$ | 2.15 | $ | 2.09 | $ | 1.93 | ||||||
Diluted
earnings per
share
|
$ | 2.15 | $ | 2.09 | $ | 1.92 |
11.
|
Stock-Based
Compensation
|
2008
|
2007
|
2006
|
||||||||||
Risk-free
interest
rate
|
4.50% | 4.00% | 4.00% | |||||||||
Dividend
yield
|
.80% | .70% | .50% | |||||||||
Expected volatility of Cintas' common stock | 30% | 35% | 35% | |||||||||
Expected
life of the option in years
|
8.5 | 7.5 | 9.0 |
Shares
|
Weighted
Average
Exercise
Price
|
|||||||
Outstanding
May 31, 2005 (3,086,485 shares exercisable)
|
6,441,885 | $ | 37.92 | |||||
Granted
|
1,248,450 | 43.96 | ||||||
Cancelled
|
(637,502 | ) | 41.38 | |||||
Exercised
|
(517,429 | ) | 20.86 | |||||
Outstanding
May 31, 2006 (2,718,180 shares exercisable)
|
6,535,404 | 40.08 | ||||||
Granted
|
1,226,855 | 38.05 | ||||||
Cancelled
|
(720,927 | ) | 41.47 | |||||
Exercised
|
(392,728 | ) | 22.40 | |||||
Outstanding
May 31, 2007 (2,316,157 shares exercisable)
|
6,648,604 | 40.60 | ||||||
Granted
|
1,005,200 | 30.99 | ||||||
Cancelled
|
(745,197 | ) | 40.15 | |||||
Exercised
|
(259,839 | ) | 24.07 | |||||
Outstanding May 31, 2008
(2,041,837 shares exercisable)
|
6,648,768 | $ | 39.85 |
Outstanding
Options
|
Exercisable
Options
|
|||||||||||||||||||||||||
Range
of
Exercise
Prices
|
Number
Outstanding
|
Average
Remaining
Option
Life
|
Weighted
Average
Exercise
Price
|
Number
Exercisable
|
Weighted
Average
Exercise
Price
|
|||||||||||||||||||||
$ | 27.85 | – | $ | 39.19 | 1,693,310 | 7.63 | $ | 32.28 | 260,575 | $ | 32.00 | |||||||||||||||
39.29 | – | 41.65 | 1,710,806 | 5.82 | 40.29 | 503,360 | 41.62 | |||||||||||||||||||
41.72 | – | 44.33 | 1,874,302 | 4.59 | 42.28 | 752,452 | 42.39 | |||||||||||||||||||
44.43 | – | 53.19 | 1,370,350 | 5.67 | 45.71 | 525,450 | 47.73 | |||||||||||||||||||
$ | 27.85 | – | $ | 53.19 | 6,648,768 | 5.90 | $ | 39.85 | 2,041,837 | $ | 42.25 |
Shares
|
Weighted
Average
Fair
Value
|
|||||||
Outstanding,
unvested grants at May 31, 2005
|
— | — | ||||||
Granted
|
128,075 | $ | 36.08 | |||||
Cancelled
|
— | — | ||||||
Vested
|
— | — | ||||||
Outstanding,
unvested grants at May 31, 2006
|
128,075 | 36.08 | ||||||
Granted
|
251,011 | 38.11 | ||||||
Cancelled
|
(49,662 | ) | 37.92 | |||||
Vested
|
— | — | ||||||
Outstanding,
unvested grants at May 31, 2007
|
329,424 | 37.35 | ||||||
Granted
|
240,086 | 30.05 | ||||||
Cancelled
|
(35,879 | ) | 38.16 | |||||
Vested
|
— | — | ||||||
Outstanding,
unvested grants at May 31, 2008
|
533,631 | $ | 34.01 |
12.
|
Litigation and Other
Contingencies
|
Rental
Uniforms
&
Ancillary
Products
|
Uniform
Direct
Sales
|
First
Aid,
Safety
&
Fire
Protection
|
Document
Management
|
Corporate
|
Total
|
|||||||||||||||||||
May
31, 2008
|
||||||||||||||||||||||||
Revenue
|
$ | 2,834,568 | $ | 517,490 | $ | 403,552 | $ | 182,290 | $ | — | $ | 3,937,900 | ||||||||||||
Gross
margin
|
$ | 1,252,951 | $ | 168,210 | $ | 160,823 | $ | 99,616 | $ | — | $ | 1,681,600 | ||||||||||||
Selling
and admin. expenses
|
801,691 | 103,444 | 125,185 | 73,825 | — | 1,104,145 | ||||||||||||||||||
Interest
income
|
— | — | — | — | (6,072 | ) | (6,072 | ) | ||||||||||||||||
Interest
expense
|
— | — | — | — | 52,823 | 52,823 | ||||||||||||||||||
Income
before income taxes
|
$ | 451,260 | $ | 64,766 | $ | 35,638 | $ | 25,791 | $ | (46,751 | ) | $ | 530,704 | |||||||||||
Depreciation
and amortization
|
$ | 139,781 | $ | 7,072 | $ | 17,483 | $ | 27,567 | $ | — | $ | 191,903 | ||||||||||||
Capital
expenditures
|
$ | 140,838 | $ | 6,454 | $ | 12,043 | $ | 30,998 | $ | — | $ | 190,333 | ||||||||||||
Total
assets
|
$ | 2,620,138 | $ | 205,638 | $ | 345,479 | $ | 445,651 | $ | 191,695 | $ | 3,808,601 | ||||||||||||
May
31, 2007
|
||||||||||||||||||||||||
Revenue
|
$ | 2,734,629 | $ | 501,443 | $ | 362,417 | $ | 108,411 | $ | — | $ | 3,706,900 | ||||||||||||
Gross
margin
|
$ | 1,219,444 | $ | 160,676 | $ | 144,439 | $ | 56,796 | $ | — | $ | 1,581,355 | ||||||||||||
Selling
and admin. expenses
|
757,058 | 97,361 | 106,171 | 49,592 | (6,224 | ) | 1,003,958 | |||||||||||||||||
Interest
income
|
— | — | — | — | (6,480 | ) | (6,480 | ) | ||||||||||||||||
Interest
expense
|
— | — | — | — | 50,324 | 50,324 | ||||||||||||||||||
Income
before income taxes
|
$ | 462,386 | $ | 63,315 | $ | 38,268 | $ | 7,204 | $ | (37,620 | ) | $ | 533,553 | |||||||||||
Depreciation
and amortization
|
$ | 135,207 | $ | 6,548 | $ | 14,943 | $ | 19,228 | $ | — | $ | 175,926 | ||||||||||||
Capital
expenditures
|
$ | 132,857 | $ | 7,955 | $ | 11,384 | $ | 28,628 | $ | — | $ | 180,824 | ||||||||||||
Total
assets
|
$ | 2,567,070 | $ | 183,373 | $ | 330,735 | $ | 333,889 | $ | 155,413 | $ | 3,570,480 | ||||||||||||
May
31, 2006
|
||||||||||||||||||||||||
Revenue
|
$ | 2,568,776 | $ | 484,934 | $ | 285,348 | $ | 64,550 | $ | — | $ | 3,403,608 | ||||||||||||
Gross
margin
|
$ | 1,161,947 | $ | 145,837 | $ | 113,142 | $ | 33,866 | $ | — | $ | 1,454,792 | ||||||||||||
Selling
and admin. expenses
|
693,579 | 104,672 | 82,259 | 31,240 | — | 911,750 | ||||||||||||||||||
Interest
income
|
— | — | — | — | (6,759 | ) | (6,759 | ) | ||||||||||||||||
Interest
expense
|
— | — | — | — | 31,782 | 31,782 | ||||||||||||||||||
Income
before income taxes
|
$ | 468,368 | $ | 41,165 | $ | 30,883 | $ | 2,626 | $ | (25,023 | ) | $ | 518,019 | |||||||||||
Depreciation
and amortization
|
$ | 130,327 | $ | 6,396 | $ | 11,383 | $ | 12,547 | $ | — | $ | 160,653 | ||||||||||||
Capital
expenditures
|
$ | 125,290 | $ | 8,163 | $ | 11,272 | $ | 11,907 | $ | — | $ | 156,632 | ||||||||||||
Total
assets
|
$ | 2,530,685 | $ | 162,456 | $ | 285,378 | $ | 205,265 | $ | 241,453 | $ | 3,425,237 |
14.
|
Quarterly Financial
Data (Unaudited)
|
May
31, 2008
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
||||||||||||
Revenue
|
$ | 969,128 | $ | 983,865 | $ | 975,952 | $ | 1,008,955 | ||||||||
Gross
margin
|
$ | 417,372 | $ | 420,568 | $ | 411,225 | $ | 432,435 | ||||||||
Net
income
|
$ | 81,063 | $ | 82,853 | $ | 81,828 | $ | 89,661 | ||||||||
Basic
earnings per share
|
$ | .51 | $ | .53 | $ | .53 | $ | .58 | ||||||||
Diluted
earnings per share
|
$ | .51 | $ | .53 | $ | .53 | $ | .58 | ||||||||
Weighted
average number of shares outstanding (000's)
|
158,771 | 156,563 | 153,679 | 153,686 |
May
31, 2007
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
||||||||||||
Revenue
|
$ | 914,161 | $ | 923,266 | $ | 905,398 | $ | 964,075 | ||||||||
Gross
margin
|
$ | 390,481 | $ | 391,073 | $ | 385,827 | $ | 413,974 | ||||||||
Net
income
|
$ | 84,962 | $ | 82,527 | $ | 76,727 | $ | 90,322 | ||||||||
Basic
earnings per share
|
$ | .53 | $ | .51 | $ | .48 | $ | .57 | ||||||||
Diluted
earnings per share
|
$ | .53 | $ | .51 | $ | .48 | $ | .57 | ||||||||
Weighted
average number of shares outstanding (000's)
|
160,770 | 160,312 | 159,311 | 158,657 |
15.
|
Supplemental Guarantor
Information
|
Year Ended May 31,
2008
|
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation
Consolidated
|
|||||||||||||||||||
Revenue:
|
|||||||||||||||||||||||||
Rental uniforms and ancillary
products
|
$ | — | $ | 2,055,690 | $ | 578,426 | $ | 201,563 | $ | (1,111 | ) | $ | 2,834,568 | ||||||||||||
Other services
|
— | 1,418,410 | 536,881 | 67,212 | (919,171 | ) | 1,103,332 | ||||||||||||||||||
Equity in net income of
affiliates
|
335,405 | — | — | — | (335,405 | ) | — | ||||||||||||||||||
335,405 | 3,474,100 | 1,115,307 | 268,775 | (1,255,687 | ) | 3,937,900 | |||||||||||||||||||
Costs
and expenses (income):
|
|||||||||||||||||||||||||
Cost of rental uniforms and
ancillary products
|
— | 1,259,752 | 372,225 | 118,443 | (168,802 | ) | 1,581,618 | ||||||||||||||||||
Cost of other
services
|
— | 928,597 | 456,758 | 41,992 | (752,665 | ) | 674,682 | ||||||||||||||||||
Selling and administrative
expenses
|
— | 1,078,047 | (27,702 | ) | 58,176 | (4,376 | ) | 1,104,145 | |||||||||||||||||
Operating
income
|
335,405 | 207,704 | 314,026 | 50,164 | (329,844 | ) | 577,455 | ||||||||||||||||||
Interest income
|
— | — | (1,450 | ) | (4,622 | ) | — | (6,072 | ) | ||||||||||||||||
Interest expense
(income)
|
— | 54,144 | (7,106 | ) | 5,785 | — | 52,823 | ||||||||||||||||||
Income
before income taxes
|
335,405 | 153,560 | 322,582 | 49,001 | (329,844 | ) | 530,704 | ||||||||||||||||||
Income
taxes
|
— | 57,504 | 120,798 | 16,997 | — | 195,299 | |||||||||||||||||||
Net
income
|
$ | 335,405 | $ | 96,056 | $ | 201,784 | $ | 32,004 | $ | (329,844 | ) | $ | 335,405 |
Year
Ended May 31, 2007
|
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation
Consolidated
|
||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||
Rental uniforms and ancillary
products
|
$ | — | $ | 2,009,095 | $ | 554,595 | $ | 171,634 | $ | (695 | ) | $ | 2,734,629 | |||||||||||
Other services
|
— | 1,337,319 | 543,535 | 57,625 | (966,208 | ) | 972,271 | |||||||||||||||||
Equity in net income of
affiliates
|
334,538 | — | — | — | (334,538 | ) | — | |||||||||||||||||
334,538 | 3,346,414 | 1,098,130 | 229,259 | (1,301,441 | ) | 3,706,900 | ||||||||||||||||||
Costs
and expenses (income):
|
||||||||||||||||||||||||
Cost of rental uniforms and
ancillary poducts
|
— | 1,249,798 | 333,004 | 102,133 | (169,750 | ) | 1,515,185 | |||||||||||||||||
Cost of other
services
|
— | 1,015,381 | 352,099 | 35,424 | (792,544 | ) | 610,360 | |||||||||||||||||
Selling and administrative
expenses
|
— | 891,836 | 70,341 | 48,817 | (7,036 | ) | 1,003,958 | |||||||||||||||||
Operating
income
|
334,538 | 189,399 | 342,686 | 42,885 | (332,111 | ) | 577,397 | |||||||||||||||||
Interest income
|
— | (2,628 | ) | (528 | ) | (3,324 | ) | — | (6,480 | ) | ||||||||||||||
Interest expense
(income)
|
— | 50,981 | (6,307 | ) | 5,650 | — | 50,324 | |||||||||||||||||
Income
before income taxes
|
334,538 | 141,046 | 349,521 | 40,559 | (332,111 | ) | 533,553 | |||||||||||||||||
Income
taxes
|
— | 52,853 | 130,972 | 15,190 | — | 199,015 | ||||||||||||||||||
Net
income
|
$ | 334,538 | $ | 88,193 | $ | 218,549 | $ | 25,369 | $ | (332,111 | ) | $ | 334,538 |
Year
Ended May 31, 2006
|
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation
Consolidated
|
||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||
Rental uniforms and ancillary
products
|
$ | — | $ | 1,887,625 | $ | 524,556 | $ | 157,124 | $ | (529 | ) | $ | 2,568,776 | |||||||||||
Other services
|
— | 1,154,847 | 434,851 | 54,812 | (809,678 | ) | 834,832 | |||||||||||||||||
Equity in net income of
affiliates
|
323,382 | — | — | — | (323,382 | ) | — | |||||||||||||||||
323,382 | 3,042,472 | 959,407 | 211,936 | (1,133,589 | ) | 3,403,608 | ||||||||||||||||||
Costs
and expenses (income):
|
||||||||||||||||||||||||
Cost of rental uniforms and
ancillary products
|
— | 1,162,222 | 324,602 | 92,753 | (172,748 | ) | 1,406,829 | |||||||||||||||||
Cost of other
services
|
— | 870,532 | 284,310 | 35,082 | (647,937 | ) | 541,987 | |||||||||||||||||
Selling and administrative
expenses
|
— | 838,556 | 26,580 | 45,922 | 692 | 911,750 | ||||||||||||||||||
Operating
income
|
323,382 | 171,162 | 323,915 | 38,179 | (313,596 | ) | 543,042 | |||||||||||||||||
Interest income
|
— | (4,721 | ) | (366 | ) | (1,672 | ) | — | (6,759 | ) | ||||||||||||||
Interest expense
(income)
|
— | 32,323 | (4,864 | ) | 4,323 | — | 31,782 | |||||||||||||||||
Income
before income taxes
|
323,382 | 143,560 | 329,145 | 35,528 | (313,596 | ) | 518,019 | |||||||||||||||||
Income
taxes
|
— | 55,395 | 127,005 | 12,237 | — | 194,637 | ||||||||||||||||||
Net
income
|
$ | 323,382 | $ | 88,165 | $ | 202,140 | $ | 23,291 | $ | (313,596 | ) | $ | 323,382 |
As
of May 31, 2008
|
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation
Consolidated
|
||||||||||||||||||
Assets
|
||||||||||||||||||||||||
Current
assets:
|
||||||||||||||||||||||||
Cash and cash
equivalents
|
$ | — | $ | 36,627 | $ | 7,851 | $ | 21,746 | $ | — | $ | 66,224 | ||||||||||||
Marketable
securities
|
— | — | — | 125,471 | — | 125,471 | ||||||||||||||||||
Accounts receivable,
net
|
— | 312,424 | 119,592 | 29,329 | (31,267 | ) | 430,078 | |||||||||||||||||
Inventories,
net
|
— | 218,109 | 18,349 | 8,928 | (6,717 | ) | 238,669 | |||||||||||||||||
Uniforms and other rental items
in service
|
— | 288,097 | 85,753 | 24,319 | (27,753 | ) | 370,416 | |||||||||||||||||
Deferred tax
asset
|
— | — | 41,664 | (2,254 | ) | — | 39,410 | |||||||||||||||||
Prepaid
expenses
|
— | 5,038 | 5,876 | 1,154 | — | 12,068 | ||||||||||||||||||
Total
current assets
|
— | 860,295 | 279,085 | 208,693 | (65,737 | ) | 1,282,336 | |||||||||||||||||
Property
and equipment, at cost, net
|
— | 675,559 | 236,519 | 62,497 | — | 974,575 | ||||||||||||||||||
Goodwill
|
— | — | 1,279,819 | 35,750 | — | 1,315,569 | ||||||||||||||||||
Service
contracts, net
|
— | 145,115 | 2,612 | 5,030 | — | 152,757 | ||||||||||||||||||
Other
assets, net
|
1,736,604 | 1,601,661 | 1,758,268 | 369,232 | (5,382,401 | ) | 83,364 | |||||||||||||||||
$ | 1,736,604 | $ | 3,282,630 | $ | 3,556,303 | $ | 681,202 | $ | (5,448,138 | ) | $ | 3,808,601 | ||||||||||||
Liabilities
and Shareholders' Equity
|
||||||||||||||||||||||||
Current
liabilities:
|
||||||||||||||||||||||||
Accounts
payable
|
$ | (465,247 | ) | $ | 289,695 | $ | 255,399 | $ | (3,668 | ) | $ | 18,576 | $ | 94,755 | ||||||||||
Accrued compensation and
related liabilities
|
— | 29,869 | 18,210 | 2,526 | — | 50,605 | ||||||||||||||||||
Accrued
liabilities
|
— | 54,113 | 146,669 | 8,063 | (920 | ) | 207,925 | |||||||||||||||||
Current income
taxes
|
— | (75 | ) | 12,686 | 276 | — | 12,887 | |||||||||||||||||
Long-term debt due within one
year
|
— | 698 | 574 | — | (202 | ) | 1,070 | |||||||||||||||||
Total
current liabilities
|
(465,247 | ) | 374,300 | 433,538 | 7,197 | 17,454 | 367,242 | |||||||||||||||||
Long-term
liabilities:
|
||||||||||||||||||||||||
Long-term debt due after one
year
|
— | 952,595 | 893 | 27,213 | (37,965 | ) | 942,736 | |||||||||||||||||
Deferred income
taxes
|
— | — | 118,479 | 5,705 | — | 124,184 | ||||||||||||||||||
Accrued
liabilities
|
— | — | 120,308 | — | — | 120,308 | ||||||||||||||||||
Total
long-term liabilities
|
— | 952,595 | 239,680 | 32,918 | (37,965 | ) | 1,187,228 | |||||||||||||||||
Total
shareholders' equity
|
2,201,851 | 1,955,735 | 2,883,085 | 641,087 | (5,427,627 | ) | 2,254,131 | |||||||||||||||||
$ | 1,736,604 | $ | 3,282,630 | $ | 3,556,303 | $ | 681,202 | $ | (5,448,138 | ) | $ | 3,808,601 |
As
of May 31, 2007
|
Cintas
Corporation
|
Corp.
2
|
Effect
of Legal Restructure*
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation
Consolidated
|
|||||||||||||||||||||
Assets
|
||||||||||||||||||||||||||||
Current
assets:
|
||||||||||||||||||||||||||||
Cash and cash
equivalents
|
$ | — | $ | 1,327 | $ | 32,622 | $ | (24,835 | ) | $ | 26,246 | $ | — | $ | 35,360 | |||||||||||||
Marketable
securities
|
— | 36,664 | (36,664 | ) | 36,664 | 83,389 | — | 120,053 | ||||||||||||||||||||
Accounts receivable,
net
|
— | 271,868 | 26,974 | 109,375 | 24,252 | (23,599 | ) | 408,870 | ||||||||||||||||||||
Inventories,
net
|
— | 204,164 | 4,032 | 23,350 | 7,775 | (7,580 | ) | 231,741 | ||||||||||||||||||||
Uniforms and other rental
items
in
service
|
— | 273,246 | 33 | 82,621 | 21,482 | (32,451 | ) | 344,931 | ||||||||||||||||||||
Prepaid
expenses
|
— | 11,486 | (6,115 | ) | 9,506 | 904 | — | 15,781 | ||||||||||||||||||||
Total
current assets
|
— | 798,755 | 20,882 | 236,681 | 164,048 | (63,630 | ) | 1,156,736 | ||||||||||||||||||||
Property
and equipment, at cost,
net
|
— | 619,691 | 25,787 | 218,903 | 55,862 | — | 920,243 | |||||||||||||||||||||
Goodwill
|
— | 347,516 | (347,516 | ) | 1,223,896 | 21,981 | — | 1,245,877 | ||||||||||||||||||||
Service
contracts, net
|
— | 102,574 | 60,387 | 3,724 | 4,676 | — | 171,361 | |||||||||||||||||||||
Other
assets, net
|
1,665,370 | 72,191 | 10,721 | 1,363,667 | 194,142 | (3,229,828 | ) | 76,263 | ||||||||||||||||||||
$ | 1,665,370 | $ | 1,940,727 | $ | (229,739 | ) | $ | 3,046,871 | $ | 440,709 | $ | (3,293,458 | ) | $ | 3,570,480 | |||||||||||||
Liabilities
and Shareholders' Equity
|
||||||||||||||||||||||||||||
Current
liabilities:
|
||||||||||||||||||||||||||||
Accounts
payable
|
$ | (465,247 | ) | $ | (423,711 | ) | $ | (1,387,144 | ) | $ | 2,312,352 | $ | 1,926 | $ | 26,446 | $ | 64,622 | |||||||||||
Accrued compensation
and
related
liabilities
|
— | 42,152 | 5,478 | 12,189 | 3,007 | — | 62,826 | |||||||||||||||||||||
Accrued
liabilities
|
— | 196,158 | (151,805 | ) | 150,790 | 6,477 | (934 | ) | 200,686 | |||||||||||||||||||
Current income
taxes
|
— | 586 | (23 | ) | 16,206 | 1,815 | — | 18,584 | ||||||||||||||||||||
Deferred income
taxes
|
— | — | — | 50,237 | 1,942 | — | 52,179 | |||||||||||||||||||||
Long-term debt due within
one
year
|
— | 3,228 | 222,586 | (221,486 | ) | — | (187 | ) | 4,141 | |||||||||||||||||||
Total
current liabilities
|
(465,247 | ) | (181,587 | ) | (1,310,908 | ) | 2,320,288 | 15,167 | 25,325 | 403,038 | ||||||||||||||||||
Long-term
debt due after one year
|
— | 882,921 | (221,352 | ) | 159,255 | 92,448 | (36,198 | ) | 877,074 | |||||||||||||||||||
Deferred
income taxes
|
— | — | — | 117,485 | 5,145 | — | 122,630 | |||||||||||||||||||||
Total
shareholders' equity
|
2,130,617 | 1,239,393 | 1,302,521 | 449,843 | 327,949 | (3,282,585 | ) | 2,167,738 | ||||||||||||||||||||
$ | 1,665,370 | $ | 1,940,727 | $ | (229,739 | ) | $ | 3,046,871 | $ | 440,709 | $ | (3,293,458 | ) | $ | 3,570,480 |
Year
Ended May 31, 2008
|
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-
Guarantors
|
Eliminations
|
Cintas
Corporation
Consolidated
|
||||||||||||||||||
Cash
flows from operating activities:
|
||||||||||||||||||||||||
Net
income
|
$ | 335,405 | $ | 96,056 | $ | 201,784 | $ | 32,004 | $ | (329,844 | ) | $ | 335,405 | |||||||||||
Adjustments to
reconcile net
income to
net cash provided by
(used
in) operating
activities:
|
||||||||||||||||||||||||
Depreciation
|
— | 97,251 | 42,730 | 8,585 | — | 148,566 | ||||||||||||||||||
Amortization of deferred
charges
|
— | 39,762 | 1,303 | 2,272 | — | 43,337 | ||||||||||||||||||
Stock-based compensation
|
7,456 | — | — | — | — | 7,456 | ||||||||||||||||||
Deferred income taxes
|
— | — | 1,380 | 283 | — | 1,663 | ||||||||||||||||||
Changes
in current assets and
liabilities,
net of acquisitions
of
businesses:
|
||||||||||||||||||||||||
Accounts
receivable
|
— | (9,775 | ) | (10,217 | ) | (2,615 | ) | 7,668 | (14,939 | ) | ||||||||||||||
Inventories
|
— | (9,703 | ) | 5,053 | (587 | ) | (863 | ) | (6,100 | ) | ||||||||||||||
Uniforms and other
rental
items in
service
|
— | (14,818 | ) | (3,183 | ) | (1,155 | ) | (4,698 | ) | (23,854 | ) | |||||||||||||
Prepaid
expenses
|
— | 325 | 3,630 | (125 | ) | — | 3,830 | |||||||||||||||||
Accounts
payable
|
— | 2,160,426 | (2,139,010 | ) | 17,021 | (7,870 | ) | 30,567 | ||||||||||||||||
Accrued compensation
and
related
liabilities
|
— | (17,761 | ) | 6,021 | (690 | ) | — | (12,430 | ) | |||||||||||||||
Accrued liabilities and
other
|
— | 20,634 | (752 | ) | 2,305 | 14 | 22,201 | |||||||||||||||||
Income taxes
payable
|
— | (638 | ) | 11,122 | (1,643 | ) | — | 8,841 | ||||||||||||||||
Net
cash provided by (used in)
operating
activities
|
342,861 | 2,361,759 | (1,880,139 | ) | 55,655 | (335,593 | ) | 544,543 | ||||||||||||||||
Cash
flows from investing activities:
|
||||||||||||||||||||||||
Capital
expenditures
|
— | (121,962 | ) | (60,818 | ) | (7,553 | ) | — | (190,333 | ) | ||||||||||||||
Proceeds from sale
or redemption of
marketable
securities
|
— | — | 37,663 | 8,128 | — | 45,791 | ||||||||||||||||||
Purchase of
marketable securities
and
investments
|
— | (1,523,625 | ) | (377,963 | ) | (42,921 | ) | 1,890,011 | (54,498 | ) | ||||||||||||||
Acquisitions of
businesses, net of
cash
acquired
|
— | (93,773 | ) | (41 | ) | (17,721 | ) | — | (111,535 | ) | ||||||||||||||
Other
|
(84,965 | ) | (678,313 | ) | 2,315,520 | (6 | ) | (1,552,636 | ) | (400 | ) | |||||||||||||
Net
cash (used in) provided by
investing
activities
|
(84,965 | ) | (2,417,673 | ) | 1,914,361 | (60,073 | ) | 337,375 | (310,975 | ) | ||||||||||||||
Cash
flows from financing activities:
|
||||||||||||||||||||||||
Proceeds from
issuance of debt
|
— | 295,000 | — | — | — | 295,000 | ||||||||||||||||||
Repayment of
debt
|
— | (229,090 | ) | (1,537 | ) | — | (1,782 | ) | (232,409 | ) | ||||||||||||||
Stock options
exercised
|
8,371 | — | — | — | — | 8,371 | ||||||||||||||||||
Dividends
paid
|
(70,831 | ) | — | — | — | — | (70,831 | ) | ||||||||||||||||
Repurchase of
common stock
|
(191,479 | ) | — | — | — | — | (191,479 | ) | ||||||||||||||||
Other
|
(3,957 | ) | (7,318 | ) | — | (81 | ) | — | (11,356 | ) | ||||||||||||||
Net
cash (used in) provided by financing
activities
|
(257,896 | ) | 58,592 | (1,537 | ) | (81 | ) | (1,782 | ) | (202,704 | ) | |||||||||||||
Net
increase (decrease) in cash and cash
equivalents
|
— | 2,678 | 32,685 | (4,499 | ) | — | 30,864 | |||||||||||||||||
Cash
and cash equivalents at beginning of
period
|
— | 33,949 | (24,834 | ) | 26,245 | — | 35,360 | |||||||||||||||||
Cash
and cash equivalents at end of period
|
$ | — | $ | 36,627 | $ | 7,851 | $ | 21,746 | $ | — | $ | 66,224 |
Year
Ended May 31, 2007
|
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-
Guarantors
|
Eliminations
|
Cintas
Corporation
Consolidated
|
||||||||||||||||||
Cash
flows from operating activities:
|
||||||||||||||||||||||||
Net
income
|
$ | 334,538 | $ | 88,193 | $ | 218,549 | $ | 25,369 | $ | (332,111 | ) | $ | 334,538 | |||||||||||
Adjustments to
reconcile net
income to net
cash provided by
(used in)
operating activities:
|
||||||||||||||||||||||||
Depreciation
|
— | 96,145 | 32,371 | 6,665 | — | 135,181 | ||||||||||||||||||
Amortization of
deferred charges
|
— | 23,349 | 15,079 | 2,317 | — | 40,745 | ||||||||||||||||||
Stock-based
compensation
|
4,500 | — | — | — | — | 4,500 | ||||||||||||||||||
Deferred income
taxes
|
— | (10,263 | ) | 9,072 | 859 | — | (332 | ) | ||||||||||||||||
Changes in current assets
and
liabilities, net of
acquisitions
of businesses:
|
||||||||||||||||||||||||
Accounts
receivable
|
— | (13,456 | ) | (7,148 | ) | (2,237 | ) | 11,381 | (11,460 | ) | ||||||||||||||
Inventories
|
— | (31,593 | ) | 1,328 | 712 | (2,537 | ) | (32,090 | ) | |||||||||||||||
Uniforms and
other rental
items in service
|
— | (1,049 | ) | (5,192 | ) | (836 | ) | 109 | (6,968 | ) | ||||||||||||||
Prepaid
expenses
|
— | (3,229 | ) | (845 | ) | (428 | ) | — | (4,502 | ) | ||||||||||||||
Accounts
payable
|
— | (210,868 | ) | 199,229 | 15,552 | (11,567 | ) | (7,654 | ) | |||||||||||||||
Accrued
compensation and
related
liabilities
|
— | 7,356 | 5,016 | 228 | — | 12,600 | ||||||||||||||||||
Accrued
liabilities
|
— | 5,429 | 3,859 | 678 | 15 | 9,981 | ||||||||||||||||||
Income taxes
payable
|
— | (3,495 | ) | (21,173 | ) | (480 | ) | — | (25,148 | ) | ||||||||||||||
Net
cash provided by (used in)
operating
activities
|
339,038 | (53,481 | ) | 450,145 | 48,399 | (334,710 | ) | 449,391 | ||||||||||||||||
Cash
flows from investing activities:
|
||||||||||||||||||||||||
Capital
expenditures
|
— | (106,396 | ) | (63,606 | ) | (10,822 | ) | — | (180,824 | ) | ||||||||||||||
Proceeds from sale or
redemption of
marketable
securities
|
— | 120,365 | — | (2,191 | ) | — | 118,174 | |||||||||||||||||
Purchase of marketable
securities
and
investments
|
— | (12,247 | ) | (17,346 | ) | (30,051 | ) | 11,129 | (48,515 | ) | ||||||||||||||
Acquisitions of businesses, net
of
cash
acquired
|
— | (81,212 | ) | (79,192 | ) | (303 | ) | — | (160,707 | ) | ||||||||||||||
Other
|
(82,809 | ) | 49,477 | (292,970 | ) | 325 | 324,141 | (1,836 | ) | |||||||||||||||
Net
cash (used in) provided by
investing
activities
|
(82,809 | ) | (30,013 | ) | (453,114 | ) | (43,042 | ) | 335,270 | (273,708 | ) | |||||||||||||
Cash
flows from financing activities:
|
||||||||||||||||||||||||
Proceeds from issuance of
debt
|
— | 250,000 | 2,460 | — | — | 252,460 | ||||||||||||||||||
Repayment of
debt
|
— | (169,049 | ) | (378 | ) | — | (560 | ) | (169,987 | ) | ||||||||||||||
Stock options
exercised
|
10,863 | — | — | — | — | 10,863 | ||||||||||||||||||
Dividends paid
|
(61,996 | ) | — | — | — | — | (61,996 | ) | ||||||||||||||||
Repurchase of common
stock
|
(198,949 | ) | — | — | — | — | (198,949 | ) | ||||||||||||||||
Other
|
(6,147 | ) | (5,591 | ) | — | 110 | — | (11,628 | ) | |||||||||||||||
Net
cash (used in) provided by financing
activities
|
(256,229 | ) | 75,360 | 2,082 | 110 | (560 | ) | (179,237 | ) | |||||||||||||||
Net
(decrease) increase in cash and cash
equivalents
|
— | (8,134 | ) | (887 | ) | 5,467 | — | (3,554 | ) | |||||||||||||||
Cash
and cash equivalents at beginning
of
period
|
— | 9,461 | 8,674 | 20,779 | — | 38,914 | ||||||||||||||||||
Cash
and cash equivalents at end of period
|
$ | — | $ | 1,327 | $ | 7,787 | $ | 26,246 | $ | — | $ | 35,360 |
Year
Ended May 31, 2006
|
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-
Guarantors
|
Eliminations
|
Cintas
Corporation
Consolidated
|
||||||||||||||
Cash
flows from operating activities:
|
||||||||||||||||||||
Net
income
|
$ | 323,382 | $ | 88,165 | $ | 202,140 | $ | 23,291 | $ | (313,596 | ) | $ | 323,382 | |||||||
Adjustments to
reconcile net
income
to net cash provided
by
(used
in) operating activities:
|
||||||||||||||||||||
Depreciation
|
— | 91,528 | 29,220 | 6,369 | — | 127,117 | ||||||||||||||
Amortization of
deferred charges
|
— | 18,611 | 12,115 | 2,810 | — | 33,536 | ||||||||||||||
Stock-based
compensation
|
4,725 | — | — | — | — | 4,725 | ||||||||||||||
Deferred income
taxes
|
— | 41 | (484 | ) | 391 | — | (52 | ) | ||||||||||||
Changes in current
assets and
liabilities, net
of acquisitions
of
businesses:
|
||||||||||||||||||||
Accounts
receivable
|
— | (9,074 | ) | (22,532 | ) | (12,376 | ) | (172 | ) | (44,154 | ) | |||||||||
Inventories
|
— | 28,804 | (1,688 | ) | 831 | (5,914 | ) | 22,033 | ||||||||||||
Uniforms and other
rental
items in service
|
— | (16,621 | ) | (2,749 | ) | (3,412 | ) | (3,901 | ) | (26,683 | ) | |||||||||
Prepaid
expenses
|
— | (1,901 | ) | (537 | ) | 133 | — | (2,305 | ) | |||||||||||
Accounts
payable
|
— | (294,789 | ) | 311,988 | (14,870 | ) | — | 2,329 | ||||||||||||
Accrued
compensation and
related liabilities
|
— | 6,509 | 4,128 | 787 | — | 11,424 | ||||||||||||||
Accrued
liabilities
|
— | (6,848 | ) | 2,902 | 2,028 | 13 | (1,905 | ) | ||||||||||||
Income taxes
payable
|
— | 4,721 | 5,871 | 957 | 29 | 11,578 | ||||||||||||||
Net
cash provided by (used in)
operating
activities
|
328,107 | (90,854 | ) | 540,374 | 6,939 | (323,541 | ) | 461,025 | ||||||||||||
Cash
flows from investing activities:
|
||||||||||||||||||||
Capital
expenditures
|
— | (79,858 | ) | (60,271 | ) | (16,503 | ) | — | (156,632 | ) | ||||||||||
Proceeds from sale
or redemption of
marketable securities
|
— | 70,772 | — | 16,705 | — | 87,477 | ||||||||||||||
Purchase of
marketable securities
and
investments
|
— | (10,266 | ) | (19,489 | ) | (34,119 | ) | 31,942 | (31,932 | ) | ||||||||||
Acquisitions of
businesses, net of
cash
acquired
|
— | (231,896 | ) | (109,312 | ) | (5,155 | ) | — | (346,363 | ) | ||||||||||
Other
|
44,523 | 11,108 | (346,339 | ) | 3,671 | 294,441 | 7,404 | |||||||||||||
Net
cash provided by (used in)
investing
activities
|
44,523 | (240,140 | ) | (535,411 | ) | (35,401 | ) | 326,383 | (440,046 | ) | ||||||||||
Cash
flows from financing activities:
|
||||||||||||||||||||
Proceeds from
issuance of debt
|
— | 333,500 | — | — | — | 333,500 | ||||||||||||||
Repayment of
debt
|
— | (6,594 | ) | (8,859 | ) | 10,992 | (2,842 | ) | (7,303 | ) | ||||||||||
Stock options
exercised
|
14,402 | — | — | — | — | 14,402 | ||||||||||||||
Dividends
paid
|
(58,823 | ) | — | — | — | — | (58,823 | ) | ||||||||||||
Repurchase of
common stock
|
(323,409 | ) | — | — | — | — | (323,409 | ) | ||||||||||||
Other
|
(4,800 | ) | 290 | — | 20,882 | — | 16,372 | |||||||||||||
Net
cash (used in) provided by financing
activities
|
(372,630 | ) | 327,196 | (8,859 | ) | 31,874 | (2,842 | ) | (25,261 | ) | ||||||||||
Net
(decrease) increase in cash and cash
equivalents
|
— | (3,798 | ) | (3,896 | ) | 3,412 | — | (4,282 | ) | |||||||||||
Cash
and cash equivalents at beginning of
period
|
— | 13,259 | 12,570 | 17,367 | — | 43,196 | ||||||||||||||
Cash
and cash equivalents at end of period
|
$ | — | $ | 9,461 | $ | 8,674 | $ | 20,779 | $ | — | $ | 38,914 |
Plan category
|
Number
of shares
to
be issued
upon
exercise of
outstanding
options (1)
|
Weighted
average
exercise
price of
outstanding
options (1)
|
Number
of shares
remaining
available
for
future issuance
under
equity
compensation
plans
|
|||
Equity
compensation plans approved by shareholders
|
6,648,768
|
$39.85
|
12,622,773
|
|||
Equity
compensation plans not approved by shareholders
|
—
|
—
|
—
|
|||
Total
|
6,648,768
|
$39.85
|
12,622,773
|
(a)
(1)
|
Financial
Statements. All financial statements required to be filed by
Item 8 of this Form and included in this report are listed in Item
8. No additional financial statements are filed because the
requirements for paragraph (d) under Item 14 are not applicable to
Cintas.
|
(a)
(2)
|
Financial
Statement Schedule:
|
For
each of the three years in the period ended May 31,
2008.
|
|
Schedule
II: Valuation and Qualifying Accounts and Reserves.
|
|
All
other schedules are omitted because they are not applicable, or not
required, or because the required information is included in
the Consolidated Financial Statements or Notes thereto.
|
|
(a)
(3)
|
Exhibits.
|
Exhibit
Number
|
Description
of Exhibit
|
|
3.1
|
Restated
Articles of Incorporation, as amended (Incorporated by reference to
Exhibit 4.1 to Cintas' Form S-3 Registration Statement filed on December
3, 2007.)
|
|
3.2
|
Amended
and Restated By-laws (Incorporated by reference to Cintas’ Form 8-K dated
March 8, 2007.)
|
|
4.1
|
Indenture
dated as of May 28, 2002, among Cintas Corporation No. 2, as issuer,
Cintas Corporation, as parent guarantor, the subsidiary guarantors thereto
and Wachovia Bank, National Association, as trustee (Incorporated by
reference to Cintas’ Form 10-Q for the quarter ended February 28,
2005.)
|
|
4.2
|
Form
of 5-1/8% Senior Note due 2007 (Incorporated by reference to Cintas’ Form
10-Q for the quarter ended February 28, 2005.)
|
|
4.3
|
Form
of 6% Senior Note due 2012 (Incorporated by reference to Cintas’ Form 10-Q
for the quarter ended February 28, 2005.)
|
|
4.4
|
Form
of 6.15% Senior Note due 2036 (Incorporated by reference to Cintas’ Form
8-K dated August 17, 2006.)
|
|
10.1*
|
Incentive
Stock Option Plan (Incorporated by reference to Cintas’ Registration
Statement No. 33-23228 on Form S-8 filed under the Securities Act of
1933.)
|
|
10.2*
|
Partners'
Plan, as Amended (Incorporated by reference to Cintas’ Registration
Statement No. 33-56623 on Form S-8 filed under the Securities Act of
1933.)
|
|
10.10*
|
1999
Cintas Corporation Stock Option Plan (Incorporated by reference to Cintas’
Form 10-Q for the quarter ended November 30, 2000.)
|
|
10.11*
|
Directors’
Deferred Compensation Plan (Incorporated by reference to Cintas’ Form 10-Q
for the quarter ended November 30, 2001.)
|
|
10.16*
|
Amended
and Restated 2003 Directors’ Stock Option Plan (Incorporated by reference
to Cintas’ Form 10-K dated May 31, 2004.)
|
|
10.17*
|
Form
of agreement signed by Officers, General/Branch Managers, Professionals
and Key Managers, including Executive Officers (Incorporated by reference
to Cintas’ Form 10-Q for the quarter ended February 28,
2005.)
|
|
10.18*
|
President
and CEO Executive Compensation Plan (Incorporated by reference to Cintas’
Form 10-K dated May 31, 2005.)
|
|
10.19*
|
2006
Executive Incentive Plan (Incorporated by reference to Cintas’ Form 10-K
dated May 31, 2005.)
|
|
10.20*
|
2005
Equity Compensation Plan (Incorporated by reference to Cintas’
Registration Statement No. 333-131375 on Form S-8 filed under the
Securities Act of 1933.)
|
|
10.21*
|
Criteria
for Performance Evaluation of the President and CEO (Incorporated by
reference to Cintas’ Form 10-K dated May 31, 2006.)
|
|
10.22*
|
2007
Executive Incentive Plan (Incorporated by reference to Cintas’ Form 10-K
dated May 31, 2006.)
|
|
14
|
Code
of Ethics (Incorporated by reference to Cintas’ Form 10-K dated May 31,
2004.)
|
|
21**
|
Subsidiaries
of the Registrant
|
|
23**
|
Consent
of Independent Registered Public Accounting Firm
|
|
31.1**
|
Certification
of Principal Executive Officer, Pursuant to Rule 13a – 14(a) of the
Securities Exchange Act of 1934
|
|
31.2**
|
Certification
of Principal Financial Officer, Pursuant to Rule 13a – 14(a) of the
Securities Exchange Act of 1934
|
|
32.1**
|
Certification
of Chief Executive Officer, Pursuant to 18
U.S.C. § 1350
|
|
32.2**
|
Certification
of Chief Financial Officer, Pursuant to 18
U.S.C. § 1350
|
*
|
Management
compensatory contracts
|
**
|
Filed
herewith
|
|
Cintas
will provide shareholders with any exhibit upon the payment of a specified
reasonable fee, which fee shall
be limited to Cintas’ reasonable expenses in furnishing such
exhibit.
|
Signature
|
Capacity
|
Date
|
||
/s/
Richard T.
Farmer
|
Chairman
of the Board of Directors
|
July
30, 2008
|
||
Richard
T. Farmer
|
||||
/s/
Robert J.
Kohlhepp
|
Vice
Chairman of the Board of Directors
|
July
30, 2008
|
||
Robert
J. Kohlhepp
|
||||
/s/
Scott D.
Farmer
|
Chief
Executive Officer, President and Director
|
July
30, 2008
|
||
Scott
D. Farmer
|
||||
/s/
Paul R.
Carter
|
Director
|
July
30, 2008
|
||
Paul
R. Carter
|
||||
/s/ Ronald W.
Tysoe
|
Director
|
July
30, 2008
|
||
Ronald
W. Tysoe
|
||||
/s/
David C. Phillips
|
Director
|
July
30, 2008
|
||
David
C. Phillips
|
||||
/s/
William C.
Gale
|
Senior
Vice President and Chief Financial Officer
|
July
30, 2008
|
||
William
C. Gale
|
(Principal
Financial and Accounting Officer)
|
|||
Additions
|
||||||||||||||||||||
(In
thousands)
|
Balance
at Beginning of Year
|
(1)
Charged
to Costs and Expenses
|
(2)
Charged
to Other Accounts
|
(3)
Deductions
|
Balance
at
End
of
Year
|
|||||||||||||||
Allowance for Doubtful
Accounts
|
||||||||||||||||||||
May
31, 2006
|
$ | 9,891 | $ | 8,598 | $ | 2,498 | $ | 5,468 | $ | 15,519 | ||||||||||
May 31,
2007
|
$ | 15,519 | $ | 3,325 | $ | 341 | $ | 4,699 | $ | 14,486 | ||||||||||
May 31, 2008
|
$ | 14,486 | $ | 4,530 | $ | 127 | $ | 6,004 | $ | 13,139 | ||||||||||
Reserve for Obsolete
Inventory
|
||||||||||||||||||||
May
31, 2006
|
$ | 25,288 | $ | 4,518 | $ | 3,213 | $ | 8,572 | $ | 24,447 | ||||||||||
May
31, 2007
|
$ | 24,447 | $ | 2,559 | $ | 1,084 | $ | 5,184 | $ | 22,906 | ||||||||||
May 31, 2008
|
$ | 22,906 | $ | 1,431 | $ | 751 | $ | 4,428 | $ | 20,660 |
(1)
|
Represents
amounts charged to expense to increase reserve for estimated future bad
debts or to increase reserve for obsolete inventory. Amounts
related to inventory are computed by performing a thorough analysis of
future marketability by specific inventory item.
|
(2)
|
Represents
a change in the appropriate balance sheet reserve due to acquisitions
during the respective period.
|
(3)
|
Represents
reductions in the balance sheet reserve due to the actual write-off of
non-collectible accounts receivable or the physical disposal
of obsolete inventory items. These amounts do not impact
Cintas’ consolidated income
statement.
|