Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Aug. 31, 2015 | Sep. 30, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | CINTAS CORP | |
Entity Central Index Key | 723,254 | |
Document Type | 10-Q | |
Document Period End Date | Aug. 31, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --05-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 107,959,511 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 |
Consolidated Condensed Statemen
Consolidated Condensed Statements of Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
Revenue: | ||
Uniform rental and facility services | $ 938,408 | $ 873,698 |
Other | 260,482 | 228,379 |
Total revenue | 1,198,890 | 1,102,077 |
Costs and expenses: | ||
Cost of uniform rental and facility services | 518,503 | 490,675 |
Cost of other | 156,243 | 133,456 |
Selling and administrative expenses | 338,637 | 314,458 |
Operating income | 185,507 | 163,488 |
Gain on sale of stock of an equity method investment | 0 | 21,739 |
Interest income | (119) | (53) |
Interest expense | 16,412 | 16,583 |
Income before income taxes | 169,214 | 168,697 |
Income taxes | 63,016 | 62,792 |
Income from continuing operations | 106,198 | 105,905 |
(Loss) income from discontinued operations, net of tax benefit of $3,419 and tax expense of $2,991, respectively | (6,017) | 4,203 |
Net income | $ 100,181 | $ 110,108 |
Basic earnings (loss) per share, continuing operations (dollars per share) | $ 0.94 | $ 0.90 |
Basic earnings (loss) per share, discontinued operations (dollars per share) | (0.05) | 0.04 |
Basic earnings per share (dollars per share) | 0.89 | 0.94 |
Diluted earnings (loss) per share, continuing operations (dollars per share) | 0.93 | 0.89 |
Diluted earnings (loss) per share, discontinued operations (dollars per share) | (0.05) | 0.04 |
Diluted earnings per share (dollars per share) | $ 0.88 | $ 0.93 |
Consolidated Condensed Stateme3
Consolidated Condensed Statements of Income (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
Income Statement [Abstract] | ||
Discontinued operations, income tax (benefit) expense | $ (3,419) | $ 2,991 |
Consolidated Condensed Stateme4
Consolidated Condensed Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 100,181 | $ 110,108 |
Other comprehensive (loss) income, net of tax: | ||
Foreign currency translation adjustments | (12,013) | (2,115) |
Change in fair value of derivatives | 0 | 17 |
Amortization of interest rate lock agreements | 488 | 488 |
Change in fair value of available-for-sale securities | (8) | 0 |
Other comprehensive loss | (11,533) | (1,610) |
Comprehensive income | $ 88,648 | $ 108,498 |
Consolidated Condensed Balance
Consolidated Condensed Balance Sheets (Unaudited) - USD ($) $ in Thousands | Aug. 31, 2015 | May. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 146,860 | $ 417,073 |
Marketable securities | 53,354 | 16,081 |
Accounts receivable, net | 531,127 | 496,130 |
Inventories, net | 240,046 | 226,211 |
Uniforms and other rental items in service | 537,120 | 534,005 |
Income taxes, current | 0 | 936 |
Assets held for sale | 194,275 | 21,341 |
Prepaid expenses and other current assets | 31,170 | 24,030 |
Total current assets | 1,733,952 | 1,735,807 |
Property and equipment, at cost, net | 896,786 | 871,421 |
Investments | 123,494 | 329,692 |
Goodwill | 1,272,503 | 1,195,612 |
Service contracts, net | 75,306 | 42,434 |
Other assets, net | 20,908 | 17,494 |
Total assets | 4,122,949 | 4,192,460 |
Current liabilities: | ||
Accounts payable | 131,956 | 109,607 |
Accrued compensation and related liabilities | 53,018 | 88,423 |
Accrued liabilities | 294,845 | 309,935 |
Income taxes, current | 47,640 | 0 |
Deferred tax liability | 103,410 | 112,389 |
Deferred tax liability associated with the investment in Shred-it | 78,457 | 704 |
Long-term debt due within one year | 250,000 | 0 |
Total current liabilities | 959,326 | 621,058 |
Long-term liabilities: | ||
Long-term debt due after one year | 1,050,000 | 1,300,000 |
Deferred income taxes | 148,793 | 226,938 |
Accrued liabilities | 116,161 | 112,009 |
Total long-term liabilities | 1,314,954 | 1,638,947 |
Shareholders’ equity: | ||
Preferred stock, no par value: 100,000 shares authorized, none outstanding | 0 | 0 |
Common stock, no par value: 425,000,000 shares authorized, FY 2016: 179,023,676 issued and 110,021,667 outstanding; FY 2015: 178,117,334 issued and 111,702,949 outstanding | 387,314 | 329,248 |
Paid-in capital | 148,275 | 157,183 |
Retained earnings | 4,327,807 | 4,227,620 |
Treasury stock: FY 2016: 69,002,009 shares; FY 2015: 66,414,385 shares | (2,994,723) | (2,773,125) |
Accumulated other comprehensive loss | (20,004) | (8,471) |
Total shareholders’ equity | 1,848,669 | 1,932,455 |
Total liabilities and shareholders' equity | $ 4,122,949 | $ 4,192,460 |
Consolidated Condensed Balance6
Consolidated Condensed Balance Sheets (Unaudited) (Parenthetical) - shares | Aug. 31, 2015 | May. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Preferred stock, shares authorized (shares) | 100,000 | 100,000 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Common stock, shares authorized (shares) | 425,000,000 | 425,000,000 |
Common stock, shares issued (shares) | 179,023,676 | 178,117,334 |
Common stock, shares outstanding (shares) | 110,021,667 | 111,702,949 |
Treasury stock, shares (shares) | 69,002,009 | 66,414,385 |
Consolidated Condensed Stateme7
Consolidated Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
Cash flows from operating activities: | ||
Net income | $ 100,181 | $ 110,108 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 36,165 | 35,448 |
Amortization of intangible assets | 3,603 | 4,206 |
Stock-based compensation | 23,917 | 12,280 |
Gain on sale of Storage Assets | (4,843) | 0 |
Loss on investment in Shred-it Partnership | 14,516 | 0 |
Gain on deconsolidation of Shredding | 0 | (6,619) |
Gain on sale of stock of an equity method investment | 0 | (21,739) |
Deferred income taxes | 5,632 | 2,108 |
Change in current assets and liabilities, net of acquisitions of businesses: | ||
Accounts receivable, net | (19,255) | 8,222 |
Inventories, net | (8,109) | 1,377 |
Uniforms and other rental items in service | (4,939) | (7,112) |
Prepaid expenses and other current assets | (6,024) | (5,884) |
Accounts payable | 15,531 | (1,325) |
Accrued compensation and related liabilities | (35,579) | (41,262) |
Accrued liabilities and other | (26,253) | 10,384 |
Income taxes, current | 48,540 | 48,009 |
Net cash provided by operating activities | 143,083 | 148,201 |
Cash flows from investing activities: | ||
Capital expenditures | (62,631) | (68,050) |
Proceeds from redemption of marketable securities | 152,907 | 0 |
Purchase of marketable securities and investments | (196,020) | (6,981) |
Proceeds from sale of Storage Assets | 24,395 | 0 |
Proceeds from Shredding Transaction, net of cash contributed | 0 | 3,344 |
Proceeds from sale of stock of an equity method investment | 0 | 29,933 |
Dividends received on equity method investment | 0 | 5,247 |
Acquisitions of businesses, net of cash acquired | (121,434) | (2,328) |
Other, net | 921 | 16 |
Net cash used in investing activities | (201,862) | (38,819) |
Cash flows from financing activities: | ||
Repayment of debt | (16) | (180) |
Proceeds from exercise of stock-based compensation awards | 11,844 | 13,623 |
Repurchase of common stock | (221,598) | (61,439) |
Other, net | 51 | 6,798 |
Net cash used in financing activities | (209,719) | (41,198) |
Effect of exchange rate changes on cash and cash equivalents | (1,715) | (19) |
Net (decrease) increase in cash and cash equivalents | (270,213) | 68,165 |
Cash and cash equivalents at beginning of period | 417,073 | 513,288 |
Cash and cash equivalents at end of period | $ 146,860 | $ 581,453 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Aug. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated condensed financial statements of Cintas Corporation (Cintas, the Company, we, us or our) included herein have been prepared by Cintas, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been condensed or omitted pursuant to such rules and regulations. While we believe that the disclosures are adequately presented, it is suggested that these consolidated condensed financial statements be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended May 31, 2015 . A summary of our significant accounting policies is presented beginning on page 37 of that report. There have been no material changes in the accounting policies followed by Cintas during the current fiscal year other than the adoption of new accounting pronouncements discussed in Note 2. Additionally, see Note 12 entitled Segment Information for discussion of change in reportable operating segments in the first quarter of fiscal 2016. Interim results are subject to variations and are not necessarily indicative of the results of operations for a full fiscal year. In the opinion of management, adjustments (which include only normal recurring adjustments) necessary for a fair statement of the consolidated results of the interim periods shown have been made. Effective August 31, 2015, Cintas' investment in the Shred-it Partnership (Shred-it) is classified as held for sale and as a discontinued operations for all periods presented as a result of entering into a definitive agreement on July 15, 2015 to sell its investment in Shred-it. During fiscal 2015, Cintas sold its document imaging and retention services (Storage) business and, as a result, its operations are also classified as discontinued operations for all periods presented. See Note 13 entitled Discontinued Operations for more information. As disclosed in our Annual Report on Form 10-K for the fiscal year ended May 31, 2015 , inventories are valued at the lower of cost (first-in, first-out) or market. Inventory is comprised of the following amounts at: (In thousands) August 31, May 31, Raw materials $ 17,783 $ 16,935 Work in process 18,285 17,079 Finished goods 203,978 192,197 $ 240,046 $ 226,211 |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
Aug. 31, 2015 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, ‘‘Revenue from Contracts with Customers (Topic 606),’’ to clarify revenue recognition principles. This guidance is intended to improve disclosure requirements and enhance the comparability of revenue recognition practices. Improved disclosures under the amended guidance relate to the nature, amount, timing and uncertainty of revenue that is recognized from contracts with customers. This guidance will be effective for reporting periods beginning after December 15, 2017 and will be required to be applied retrospectively. Early application of the amendments in this update is not permitted. Cintas is currently evaluating the impact that ASU 2014-09 will have on its consolidated condensed financial statements. In April 2014, the FASB issued ASU 2014-08, “ Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” which amended accounting guidance related to the reporting of discontinued operations and disclosures of disposals of components of an entity. The amended guidance changes the thresholds for disposals to qualify as discontinued operations and requires additional disclosures. This guidance is effective for reporting periods beginning after December 15, 2014 and is required to be applied prospectively. Cintas has adopted ASU 2014-08 during the quarter ended August 31, 2015 and has applied this amended accounting guidance to its investment in Shred-it and will apply it to future transactions, as appropriate. No other new accounting pronouncement recently issued or newly effective had or is expected to have a material impact on the Consolidated Condensed Financial Statements. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Aug. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements All financial instruments that are measured at fair value on a recurring basis (at least annually) have been classified within the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the consolidated balance sheet date. These financial instruments measured at fair value on a recurring basis are summarized below: As of August 31, 2015 (In thousands) Level 1 Level 2 Level 3 Fair Value Cash and cash equivalents $ 146,860 $ — $ — $ 146,860 Marketable securities: Canadian treasury securities — 53,354 — 53,354 Total assets at fair value $ 146,860 $ 53,354 $ — $ 200,214 As of May 31, 2015 (In thousands) Level 1 Level 2 Level 3 Fair Value Cash and cash equivalents $ 417,073 $ — $ — $ 417,073 Marketable securities: Canadian treasury securities — 16,081 — 16,081 Total assets at fair value $ 417,073 $ 16,081 $ — $ 433,154 Cintas’ cash and cash equivalents and marketable securities are generally classified within Level 1 or Level 2 of the fair value hierarchy. Financial instruments classified as Level 1 are based on quoted market prices in active markets, and financial instruments classified as Level 2 are based on quoted market prices, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency. The types of financial instruments Cintas classifies within Level 1 include most bank deposits and money market securities. Cintas does not adjust the quoted market price for such financial instruments. The types of financial instruments Cintas classifies within Level 2 are primarily Canadian treasury securities (federal). The valuation technique used for Cintas’ marketable securities classified within Level 2 of the fair value hierarchy is primarily the market approach. The primary inputs to value Cintas’ marketable securities are the respective instrument's future cash flows based on its stated yield and the amount a market participant would pay for a similar instrument. Primarily all of Cintas’ marketable securities are actively traded and the recorded fair value reflects current market conditions. However, due to the inherent volatility in the investment market, there is at least a possibility that recorded investment values may change in the near term. The funds invested in Canadian treasury securities are not presently expected to be repatriated, but instead are expected to be invested indefinitely in foreign subsidiaries. Interest, realized gains and losses and declines in value determined to be other than temporary on available-for-sale securities are included in interest income or expense. The cost of the securities sold is based on the specific identification method. The amortized cost basis of marketable securities as of August 31, 2015 and May 31, 2015 was $53.4 million and $16.1 million , respectively. All outstanding marketable securities at August 31, 2015 and May 31, 2015 had contractual maturities due within one year. The methods described above may produce a fair value that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while Cintas believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the consolidated balance sheet date. In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records assets and liabilities at fair value on a nonrecurring basis as required under GAAP. The Company's acquisition of ZEE Medical was recorded at fair value. See Note 9 entitled Acquisitions for additional information on the preliminary measurement of the ZEE Medical assets acquired. |
Investments
Investments | 3 Months Ended |
Aug. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Investments at August 31, 2015 of $123.5 million include equity method investments of $14.6 million , the cash surrender value of insurance policies of $106.7 million and cost method investments of $2.2 million . Investments at May 31, 2015 of $329.7 million include the cash surrender value of insurance policies of $101.8 million , equity method investments of $225.7 million and cost method investments of $2.2 million . Effective August 31, 2015, Cintas' investment in the Shred-it is classified as discontinued operations as a result of Cintas entering into a definitive agreement to sell its investment. Cintas' investment in Shred-it is classified as held for sale on the consolidated balance sheet at August 31, 2015. As allowed under applicable accounting guidance, the May 31, 2015 consolidated balance sheet amounts for these assets and liabilities remain in their natural classifications. See Note 13 entitled Discontinued Operations and Note 15 entitled Subsequent Event for additional information. On June 30, 2014, Cintas sold stock in an equity method investment. In conjunction with the sale of the equity method investment, Cintas also received a cash dividend of $5.2 million . Total cash received from the transaction was $35.2 million . The sale resulted in the recording of a gain, net of tax, of approximately $13.6 million in the three months ended August 31, 2014 . As a result, the Company no longer has the ability to exercise significant influence over the investee. Therefore, effective July 1, 2014, the remaining investment retained by Cintas is accounted for under the cost method. Investments are evaluated for impairment on an annual basis or when indicators of impairment exist. For the three months ended August 31, 2015 and 2014 , no losses due to impairment were recorded. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Aug. 31, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share from continuing operations using the two-class method for amounts attributable to Cintas’ common shares: Three Months Ended (In thousands except per share data) August 31, August 31, Basic Earnings per Share from Continuing Operations Income from continuing operations $ 106,198 $ 105,905 Less: income from continuing operations allocated to participating securities 1,742 591 Income from continuing operations available to common shareholders $ 104,456 $ 105,314 Basic weighted average common shares outstanding 110,597 116,659 Basic earnings per share from continuing operations $ 0.94 $ 0.90 Three Months Ended (In thousands except per share data) August 31, August 31, Diluted Earnings per Share from Continuing Operations Income from continuing operations $ 106,198 $ 105,905 Less: income from continuing operations allocated to participating securities 1,742 591 Income from continuing operations available to common shareholders $ 104,456 $ 105,314 Basic weighted average common shares outstanding 110,597 116,659 Effect of dilutive securities – employee stock options 1,632 1,371 Diluted weighted average common shares outstanding 112,229 118,030 Diluted earnings per share from continuing operations $ 0.93 $ 0.89 Basic and diluted loss per share from discontinued operations were $(0.05) for the three months ended August 31, 2015 . Basic and diluted earnings per share from discontinued operations were $0.04 for the three months ended August 31, 2014 . For the three months ended August 31, 2015 and 2014 , options granted to purchase 0.5 million and 0.6 million shares of Cintas common stock, respectively, were excluded from the computation of diluted earnings per share. The exercise prices of these options were greater than the average market price of the common stock (anti-dilutive). On January 13, 2015, we announced that the Board of Directors authorized a $500.0 million share buyback program, which does not have an expiration date. For the three months ended August 31, 2015 , we purchased 2.4 million shares of Cintas common stock at an average price of $85.65 per share for a total purchase price of $ 202.5 million . In the period subsequent to August 31, 2015 through October 9, 2015 , we purchased 2.1 million shares of Cintas common stock for a total purchase price of $180.4 million . The January 13, 2015 share buyback program was completed in the period subsequent to August 31, 2015. From the inception of the January 13, 2015 share buyback program through September 2015, Cintas purchased a total of 5.9 million shares of Cintas common stock at an average price of $84.07 per share for a total purchase price of $500.0 million . On August 4, 2015, we announced that the Board of Directors authorized a new $500.0 million share buyback program. Under the August 4, 2015 share buyback program, Cintas purchased 1.4 million shares of Cintas common stock for a total purchase price of $120.0 million during the period subsequent to August 31, 2015 through October 9, 2015 . In addition, for the three months ended August 31, 2015 , Cintas acquired 0.2 million shares of Cintas common stock for employee payroll taxes due on restricted stock awards that vested during the three months ended August 31, 2015 . These shares were acquired at an average price of $85.54 per share for a total purchase price of $19.1 million . |
Goodwill, Service Contracts and
Goodwill, Service Contracts and Other Assets | 3 Months Ended |
Aug. 31, 2015 | |
Goodwill, Service Contracts and Other Assets [Abstract] | |
Goodwill, Service Contracts and Other Assets | Goodwill, Service Contracts and Other Assets Effective June 1, 2015, Cintas realigned its organizational structure and updated its reportable operating segments in light of certain changes in its business including the acquisition of Zee Medical. Cintas’ updated reportable operating segments are Uniform Rental and Facility Services and First Aid and Safety Services. The remainder of Cintas’ business, which consists primarily of Fire Protection Services and our Direct Sale business are included in All Other. For additional information regarding Cintas’ realignment and reportable operating segment determination, see Note 12 entitled Segment Information. As a result of Cintas’ segment realignment, the composition of Cintas’ reporting units for the evaluation of goodwill impairment also changed. Historically, Cintas’ reporting units were the same as the reportable operating segments, Rental Uniforms and Ancillary Products, Uniform Direct Sales and First Aid, Safety and Fire Protection Services. Effective June 1, 2015, Cintas identified four reporting units for purposes of evaluating goodwill impairment, Uniform Rental and Facility Services, First Aid and Safety Services, Fire Protection Services and Uniform Direct Sale. As a result of the change in reporting units, Cintas was required to perform an interim impairment test on Goodwill at June 1, 2015. There was no impairment recorded as a result of the interim impairment test for the three months ended August 31, 2015. As the composition of the reporting units changed, the Company allocated historical goodwill to the new reporting units based on a relative fair value allocation approach. The relative fair value allocation approach yielded the following allocation of total goodwill: Uniform Rental and Facility Services reportable operating segment goodwill of $943.9 million , First Aid and Safety Services reportable operating segment goodwill of $155.0 million and All Other goodwill of $96.7 million . Changes in the carrying amount of goodwill and service contracts for the three months ended August 31, 2015 , by reportable operating segment and all other, are as follows: Goodwill (in thousands) Uniform Rental and Facility Services First Aid and Safety Services All Other Total Balance as of June 1, 2015 $ 943,909 $ 154,954 $ 96,749 $ 1,195,612 Goodwill acquired — 77,630 54 77,684 Foreign currency translation (757 ) — (36 ) (793 ) Balance as of August 31, 2015 $ 943,152 $ 232,584 $ 96,767 $ 1,272,503 Service Contracts (in thousands) Uniform Rental and Facility Services First Aid and Safety Services All Other Total Balance as of June 1, 2015 $ 6,677 $ 1,576 $ 34,181 $ 42,434 Service contracts acquired — 34,970 940 35,910 Service contracts amortization (1,088 ) (439 ) (1,511 ) (3,038 ) Balance as of August 31, 2015 $ 5,589 $ 36,107 $ 33,610 $ 75,306 Information regarding Cintas’ service contracts and other assets is as follows: As of August 31, 2015 (In thousands) Carrying Amount Accumulated Amortization Net Service contracts $ 375,647 $ 300,341 $ 75,306 Noncompete and consulting agreements $ 42,290 $ 40,483 $ 1,807 Other 27,013 7,912 19,101 Total other assets $ 69,303 $ 48,395 $ 20,908 As of May 31, 2015 (In thousands) Carrying Amount Accumulated Amortization Net Service contracts $ 340,816 $ 298,382 $ 42,434 Noncompete and consulting agreements $ 41,828 $ 40,379 $ 1,449 Other 23,595 7,550 16,045 Total other assets $ 65,423 $ 47,929 $ 17,494 Amortization expense for continuing operations was $3.6 million and $3.5 million for the three months ended August 31, 2015 and 2014 , respectively. Estimated amortization expense for continuing operations, excluding any future acquisitions, for each of the next five full fiscal years is $14.6 million , $11.2 million , $10.3 million , $9.6 million and $9.2 million , respectively. |
Debt, Derivatives and Hedging A
Debt, Derivatives and Hedging Activities | 3 Months Ended |
Aug. 31, 2015 | |
Debt, Derivatives and Hedging Activities [Abstract] | |
Debt, Derivatives and Hedging Activities | Debt, Derivatives and Hedging Activities Cintas' senior notes are recorded at cost. The fair value of the senior notes is estimated using Level 2 inputs based on general market prices. The carrying value and fair value of Cintas' senior notes as of August 31, 2015 were $1,300.0 million and $1,415.1 million, respectively, and as of May 31, 2015 were $1,300.0 million and $1,418.6 million, respectively. Cintas’ commercial paper program has a capacity of $300.0 million that is fully supported by a backup revolving credit facility through a credit agreement with its banking group. This revolving credit facility has an accordion feature that allows for a maximum borrowing capacity of $450.0 million and has a maturity date of May 28, 2019. No commercial paper or borrowings on our revolving credit facility were outstanding as of August 31, 2015 or May 31, 2015 . Cintas used interest rate lock agreements to hedge against movements in the treasury rates at the time Cintas issued its senior notes in fiscal 2007, fiscal 2008, fiscal 2011 and fiscal 2013. The amortization of the cash flow hedges resulted in an increase to other comprehensive income of $0.5 million for the three months ended August 31, 2015 and 2014 . To hedge the exposure of movements in the foreign currency rates, Cintas may use foreign currency hedges. These hedges reduce the impact on cash flows from movements in the foreign currency exchange rates. Examples of foreign currency hedge instruments that Cintas may use are average rate options and forward contracts. Cintas had no foreign currency forward contracts as of August 31, 2015 . Cintas has certain covenants related to debt agreements. These covenants limit Cintas’ ability to incur certain liens, to engage in sale-leaseback transactions and to merge, consolidate or sell all or substantially all of Cintas’ assets. These covenants also require Cintas to maintain certain debt to consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) and interest coverage ratios. Cross-default provisions exist between certain debt instruments. Cintas was in compliance with all debt covenants for all periods presented. If a default of a significant covenant were to occur, the default could result in an acceleration of the maturity of the indebtedness, impair liquidity and limit the ability to raise future capital. |
Income Taxes
Income Taxes | 3 Months Ended |
Aug. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In the normal course of business, Cintas provides for uncertain tax positions and the related interest, and adjusts its unrecognized tax benefits and accrued interest accordingly. During the three months ended August 31, 2015 , unrecognized tax benefits increased by approximately $0.5 million and accrued interest increased by less than $0.1 million . All U.S. federal income tax returns are closed to audit through fiscal 2011. Cintas is currently in advanced stages of various audits in certain foreign jurisdictions and certain domestic states. The years under foreign and domestic state audits cover fiscal years back to 2009. Based on the resolution of the various audits and other potential regulatory developments, it is reasonably possible that the balance of unrecognized tax benefits will decrease by $3.4 million for the fiscal year ending May 31, 2016 . The majority of Cintas' operations are in North America. Cintas is required to file federal income tax returns, as well as state income tax returns in a majority of the domestic states and also in certain Canadian provinces. At times, Cintas is subject to audits in these jurisdictions. The audits, by nature, are sometimes complex and can require several years to resolve. The final resolution of any such tax audit could result in either a reduction in Cintas' accruals or an increase in its income tax provision, either of which could have an impact on the consolidated condensed results of operation in any given period. |
Acquisitions
Acquisitions | 3 Months Ended |
Aug. 31, 2015 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions On August 1, 2015, the Company acquired all of the shares of ZEE Medical, Inc. for acquisition-date fair value consideration of $134.0 million , consisting of cash of $120.6 million and contingent consideration subject to certain holdback provisions of $13.4 million . ZEE Medical will operate within the First Aid and Safety Services reportable operating segment. This acquisition expands our footprint in van delivered first aid, safety, training and emergency products and allows us to serve an even greater number of customers in North America. The table below summarizes the preliminary purchase price allocation of ZEE Medical as determined by valuation specialists engaged and overseen by management. Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the estimated future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. None of the goodwill is expected to be deductible for income tax purposes. The assets acquired and liabilities assumed are valued at the estimated fair value at the acquisition date as required by GAAP. (In thousands) Assets: Cash and cash equivalents $ 431 Accounts receivable 17,310 Inventory 6,195 Other current assets 1,477 Property, plant and equipment 1,354 Goodwill 77,630 Service contracts 34,970 Other intangibles 4,500 Liabilities: Accounts payable (7,342 ) Accrued liabilities (2,525 ) Total Consideration $ 134,000 Cintas is required to provide additional disclosures about fair value measurements as part of the consolidated condensed financial statements for each major category of assets and liabilities measured at fair value on a nonrecurring basis (including business acquisitions). The working capital assets and liabilities, as well as the property and equipment acquired, were valued using Level 2 inputs which included data points that are observable, such as definitive sales agreements, appraisals or established market values of comparable assets (market approach). Goodwill, service contracts and other intangibles were valued using Level 3 inputs, which are unobservable by nature, and included internal estimates of future cash flow using a discount rate of 11% (income approach). The results of operations of ZEE Medical are not material to the consolidated financial statements. |
Litigation and Other Contingenc
Litigation and Other Contingencies | 3 Months Ended |
Aug. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation and Other Contingencies | Litigation and Other Contingencies Cintas is subject to legal proceedings, insurance receipts, legal settlements and claims arising from the ordinary course of its business, including personal injury, customer contract, environmental and employment claims. In the opinion of management, the aggregate liability, if any, with respect to such ordinary course of business actions will not have a material adverse effect on the consolidated financial position, consolidated results of operations or consolidated cash flows of Cintas. Cintas is party to additional litigation not considered in the ordinary course of business, including the litigation discussed below. Cintas is a defendant in a purported Equal Employment Opportunity Commission (EEOC) systemic gender discrimination lawsuit, Mirna E. Serrano, et al. v. Cintas Corporation (Serrano), filed on May 10, 2004, and pending in the United States District Court, Eastern District of Michigan, Southern Division. The Serrano plaintiffs alleged that Cintas discriminated against women in hiring into various service sales representative (SSR) positions in the Rental Uniforms and Ancillary Products operating segment. On November 15, 2005, the EEOC intervened in the Serrano lawsuit. The Serrano plaintiffs seek lost pay, injunctive relief, compensatory damages, punitive damages, attorneys' fees and other remedies on behalf of unsuccessful female candidates for SSR positions. On October 27, 2008, the United States District Court in the Eastern District of Michigan granted summary judgment in favor of Cintas limiting the scope of the action to female applicants for SSR positions at Cintas locations within the state of Michigan. Consequently, all claims brought by or on behalf of female applicants for SSR positions outside of the state of Michigan were dismissed. Similarly, any claims brought by the EEOC on behalf of similarly situated female applicants outside of the state of Michigan have also been dismissed from the Serrano lawsuit. In September 2010, the Court in Serrano dismissed all private individual claims and all claims of the EEOC and the 13 individuals it claimed to represent. The EEOC appealed the District Court's summary judgment decisions and various other rulings to the United States Court of Appeals for the Sixth Circuit. On November 9, 2012, the Sixth Circuit Court of Appeals reversed the District Court's opinion and remanded the claims back to the District Court. On April 16, 2013, Cintas filed with the United States Supreme Court a Petition for a Writ of Certiorari seeking to review the judgment of the United States Court of Appeals for the Sixth Circuit. On October 7, 2013, the Court denied Cintas’ Petition, thus remanding the claims back to the District Court consistent with the Sixth Circuit Court’s November 9, 2012 decision. The litigation discussed above, if decided or settled adversely to Cintas, may result in liability material to Cintas' consolidated financial condition, consolidated results of operation or consolidated cash flows and could increase costs of operations on an ongoing basis. Any estimated liability relating to these proceedings is not determinable at this time. Cintas may enter into discussions regarding settlement of these and other lawsuits, and may enter into settlement agreements if it believes such settlement is in the best interest of Cintas' shareholders. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Aug. 31, 2015 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The following table summarizes the changes in the accumulated balances for each component of accumulated other comprehensive income (loss), net of tax: (In thousands) Foreign Currency Unrealized Loss on Derivatives Other Total Balance at June 1, 2015 $ 2,987 $ (10,626 ) $ (832 ) $ (8,471 ) Other comprehensive loss before reclassifications (12,013 ) — (8 ) (12,021 ) Amounts reclassified from accumulated other comprehensive income (loss) — 488 — 488 Net current period other comprehensive (loss) income (12,013 ) 488 (8 ) (11,533 ) Balance at August 31, 2015 (9,026 ) (10,138 ) (840 ) (20,004 ) (In thousands) Foreign Currency Unrealized Loss on Derivatives Other Total Balance at June 1, 2014 $ 41,525 $ (12,615 ) $ (482 ) $ 28,428 Other comprehensive (loss) income before reclassifications (2,115 ) 17 — (2,098 ) Amounts reclassified from accumulated other comprehensive income (loss) — 488 — 488 Net current period other comprehensive (loss) income (2,115 ) 505 — (1,610 ) Balance at August 31, 2014 39,410 (12,110 ) (482 ) 26,818 The following table summarizes the reclassifications out of accumulated other comprehensive (loss) income: Reclassifications out of Accumulated Other Comprehensive (Loss) Income Details about Accumulated Other Comprehensive (Loss) Income Components Amount Reclassified from Accumulated Other Comprehensive (Loss) Income Affected Line in the Consolidated Condensed Statements of Income Three Months Ended (In thousands) August 31, 2015 August 31, 2014 Amortization of interest rate locks $ (783 ) $ (783 ) Interest expense Tax benefit 295 295 Income taxes Amortization of interest rate locks, net of tax $ (488 ) $ (488 ) Net of tax |
Segment Information
Segment Information | 3 Months Ended |
Aug. 31, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information GAAP requires companies to evaluate their reportable operating segments periodically and when certain events occur. As a result of a recent evaluation, effective June 1, 2015, Cintas realigned its organizational structure and updated its reportable operating segments in light of certain changes in its business including the acquisition of Zee Medical. Cintas’ updated reportable operating segments are Uniform Rental and Facility Services and First Aid and Safety Services. The Uniform Rental and Facility Services reportable operating segment consists of the rental and servicing of uniforms and other garments including flame resistant clothing, mats, mops and shop towels and other ancillary items. In addition to these rental items, restroom cleaning services and supplies, carpet and tile cleaning services and the sale of items from our catalogs to our customers on route are included within this reportable operating segment. The First Aid and Safety Services reportable operating segment consists of first aid and safety products and services. The remainder of Cintas’ business, which consists primarily of Fire Protection Services and our Direct Sale business is included in All Other. Prior to June 1, 2015, Cintas classified its business into the following three reportable operating segments: The Rental Uniforms and Ancillary Products operating segment consisted of the rental and servicing of uniforms and other garments including flame resistant clothing, mats, mops and shop towels and other ancillary items. In addition to these rental items, restroom cleaning services and supplies and carpet and tile cleaning services were also provided within this operating segment. The Uniform Direct Sales operating segment consisted of the direct sale of uniforms and related items. The First Aid, Safety and Fire Protection Services operating segment consisted of first aid, safety and fire protection products and services. Cintas evaluates the performance of each operating segment based on several factors of which the primary financial measures are operating segment revenue and income before income taxes. The accounting policies of the operating segments are the same as those described in Note 1 entitled Basis of Presentation. Information related to the operations of Cintas’ operating segments is set forth below: (In thousands) Uniform Rental and Facility Services First Aid and Safety Services All Other Corporate (1) Total As of and for the three months ended August 31, 2015 Revenue $ 938,408 $ 99,488 $ 160,994 $ — $ 1,198,890 Income (loss) before income taxes $ 165,381 $ 8,592 $ 11,534 $ (16,293 ) $ 169,214 Total assets $ 2,870,622 $ 398,237 $ 342,712 $ 511,378 $ 4,122,949 As of and for the three months ended August 31, 2014 Revenue $ 873,698 $ 79,924 $ 148,455 $ — $ 1,102,077 Income before income taxes $ 144,816 $ 9,147 $ 9,525 $ 5,209 $ 168,697 Total assets $ 2,861,790 $ 260,580 $ 354,260 $ 1,079,640 $ 4,556,270 (1) Corporate assets as of August 31, 2015 include the investment in Shred-it, which is classified as held for sale. Corporate assets as of August 31, 2014 include the assets of Storage, which was classified as held for sale, and the investment in Shred-it. |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Aug. 31, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations Effective August 31, 2015, Cintas' investment in the Shred-it Partnership (Shred-it) is classified as held for sale and as a discontinued operations for all periods presented as a result of entering into a definitive agreement on July 15, 2015 to sell its investment in Shred-it. During fiscal 2015, Cintas sold its document imaging and retention services (Storage) business and, as a result, its operations are also classified as discontinued operations for all periods presented. As of August 31, 2015 and May 31, 2015 , the equity method investment in Shred-it was $194.3 million and $210.1 million , respectively. Cintas’ carrying value of its investment in Shred-it, as of August 31, 2015 , exceeded its share of the underlying equity in the net assets of Shred-it by approximately $91.2 million (basis difference). The remaining basis difference is being amortized over the weighted average estimated useful lives of the underlying assets which generated the basis difference (approximately 9 years ) and is recorded as a reduction in our share of income from Shred-it, net of tax. Cintas records its share of Shred-it's income on a one month lag. For the three months ended ended August 31, 2015 , Cintas recorded a net loss on the investment in the Shred-it of $9.3 million , which included amortization of basis differences of approximately $2.8 million . After the previously announced sale of Shred-it closes, the basis difference will no longer exist and Cintas will no longer record income or loss from Shred-it. See Note 15 entitled Subsequent Event for additional information on the sale of the investment in Shred-it. In the first quarter of fiscal 2015, Cintas received additional proceeds related to the contribution of its shredding business to the Shred-it Partnership. The Company realized a $3.9 million gain, net of tax, as a result of the additional consideration received. In fiscal 2015, Cintas sold Storage, excluding related real estate owned by Cintas, in three separate transactions to three separate buyers. Each transaction involves contingent consideration that the Company has an opportunity to receive if specified future events occur. Because of the uncertainty surrounding the future events, these amounts represent gain contingencies that have not been recorded. Certain real estate owned by Cintas is being leased by the buyers. These lease payments do not represent a material direct cash flow of the disposed Storage business and therefore do not impact the classification of the Storage business as a discontinued operation. On July 10, 2015, Cintas sold the remaining Storage assets classified as held for sale. For the quarter ended August 31, 2015 , Cintas received proceeds of $24.4 million from the sale of the remaining Storage assets classified as held for sale and recorded a $3.1 million gain, net of tax on the sale. Following is selected financial information included in net (loss) income from discontinued operations for Shred-it, Shredding and the Storage business: Three Months Ended (In thousands) August 31, August 31, Revenue $ — $ 20,785 Income before income taxes 237 575 Income tax expense (85 ) (240 ) Gain on sale of Storage Assets 4,843 — Loss on investment in Shred-it Partnership (14,516 ) — Gain on the deconsolidation of Shredding (1) — 6,619 Income tax benefit (expense) on (loss) gain 3,504 (2,751 ) Net (loss) income from discontinued operations $ (6,017 ) $ 4,203 (1) Results for the three months ended August 31, 2014 related to the gain on the deconsolidation of Shredding were previously presented in continuing operations and were reclassified to discontinued operations as previously discussed. |
Supplemental Guarantor Informat
Supplemental Guarantor Information | 3 Months Ended |
Aug. 31, 2015 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Supplemental Guarantor Information | Supplemental Guarantor Information Cintas Corporation No. 2 (Corp. 2) is the indirectly, wholly-owned principal operating subsidiary of Cintas. Corp. 2 is the issuer of the $1,300.0 million aggregate principal amount of 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 Three Months Ended August 31, 2015 (In thousands) Cintas Corp. 2 Subsidiary Non- Eliminations Cintas Corporation Consolidated Revenue: Uniform rental and facility services $ — $ 721,329 $ 202,265 $ 54,012 $ (39,198 ) $ 938,408 Other — 372,611 1,293 14,811 (128,233 ) 260,482 Equity in net income of affiliates 106,198 — — — (106,198 ) — 106,198 1,093,940 203,558 68,823 (273,629 ) 1,198,890 Costs and expenses (income): Cost of uniform rental and facility services — 440,580 116,832 37,357 (76,266 ) 518,503 Cost of other — 237,369 (8,643 ) 9,570 (82,053 ) 156,243 Selling and administrative expenses — 347,076 (18,855 ) 17,880 (7,464 ) 338,637 Operating income 106,198 68,915 114,224 4,016 (107,846 ) 185,507 Interest income — — (48 ) (71 ) — (119 ) Interest expense (income) — 16,375 38 (1 ) — 16,412 Income before income taxes 106,198 52,540 114,234 4,088 (107,846 ) 169,214 Income taxes — 19,589 42,591 861 (25 ) 63,016 Income from continuing operations 106,198 32,951 71,643 3,227 (107,821 ) 106,198 Loss from discontinued operations, net of tax (6,017 ) (5,323 ) — (694 ) 6,017 (6,017 ) Net income $ 100,181 $ 27,628 $ 71,643 $ 2,533 $ (101,804 ) $ 100,181 Condensed Consolidating Income Statement Three Months Ended August 31, 2014 (In thousands) Cintas Corp. 2 Subsidiary Non- Eliminations Cintas Corporation Consolidated Revenue: Uniform rental and facility services $ — $ 665,874 $ 183,181 $ 59,861 $ (35,218 ) $ 873,698 Other — 336,480 481 13,744 (122,326 ) 228,379 Equity in net income of affiliates 105,905 — — — (105,905 ) — 105,905 1,002,354 183,662 73,605 (263,449 ) 1,102,077 Costs and expenses (income): Cost of uniform rental and facility services — 408,371 110,922 40,282 (68,900 ) 490,675 Cost of other — 217,942 (10,657 ) 8,957 (82,786 ) 133,456 Selling and administrative expenses — 314,002 (14,006 ) 19,074 (4,612 ) 314,458 Operating income 105,905 62,039 97,403 5,292 (107,151 ) 163,488 Gain on sale of stock of an equity method investment — — 21,739 — — 21,739 Interest income — (5 ) (48 ) — — (53 ) Interest expense — 16,409 170 4 — 16,583 Income before income taxes 105,905 45,635 119,020 5,288 (107,151 ) 168,697 Income taxes — 16,748 44,004 2,051 (11 ) 62,792 Income from continuing operations 105,905 28,887 75,016 3,237 (107,140 ) 105,905 Income (loss) from discontinued operations, net of tax 4,203 4,263 — (60 ) (4,203 ) 4,203 Net income $ 110,108 $ 33,150 $ 75,016 $ 3,177 $ (111,343 ) $ 110,108 Condensed Consolidating Statement of Comprehensive Income Three Months Ended August 31, 2015 (In thousands) Cintas Corp. 2 Subsidiary Non- Eliminations Cintas Corporation Consolidated Net income $ 100,181 $ 27,628 $ 71,643 $ 2,533 $ (101,804 ) $ 100,181 Other comprehensive (loss) income, net of tax: Foreign currency translation adjustments — — — (12,013 ) — (12,013 ) Amortization of interest rate lock agreements — 488 — — — 488 Change in fair value of available-for-sale securities — — — (8 ) — (8 ) Other comprehensive income (loss) — 488 — (12,021 ) — (11,533 ) Comprehensive income (loss) $ 100,181 $ 28,116 $ 71,643 $ (9,488 ) $ (101,804 ) $ 88,648 Condensed Consolidating Statement of Comprehensive Income Three Months Ended August 31, 2014 (In thousands) Cintas Corp. 2 Subsidiary Non- Eliminations Cintas Corporation Consolidated Net income $ 110,108 $ 33,150 $ 75,016 $ 3,177 $ (111,343 ) $ 110,108 Other comprehensive (loss) income, net of tax: Foreign currency translation adjustments — — — (2,115 ) — (2,115 ) Change in fair value of derivatives — — — 17 — 17 Amortization of interest rate lock agreements — 488 — — — 488 Other comprehensive income (loss) — 488 — (2,098 ) — (1,610 ) Comprehensive income $ 110,108 $ 33,638 $ 75,016 $ 1,079 $ (111,343 ) $ 108,498 Condensed Consolidating Balance Sheet As of August 31, 2015 (In thousands) Cintas Corporation Corp. 2 Subsidiary Guarantors Non- Guarantors Eliminations Cintas Corporation Consolidated Assets Current assets: Cash and cash equivalents $ — $ 74,082 $ 45,339 $ 27,439 $ — $ 146,860 Marketable securities — — — 53,354 — 53,354 Accounts receivable, net — 392,911 106,001 32,215 — 531,127 Inventories, net — 207,755 22,280 9,624 387 240,046 Uniforms and other rental items in service — 402,093 118,059 35,354 (18,386 ) 537,120 Assets held for sale — 171,106 — 23,169 — 194,275 Prepaid expenses and other current assets — 6,626 23,490 1,054 — 31,170 Total current assets — 1,254,573 315,169 182,209 (17,999 ) 1,733,952 Property and equipment, at cost, net — 533,178 292,341 71,267 — 896,786 Investments 321,083 1,769,572 900,288 936,126 (3,803,575 ) 123,494 Goodwill — — 1,239,155 33,460 (112 ) 1,272,503 Service contracts, net — 73,308 26 1,972 — 75,306 Other assets, net 1,082,343 17,145 2,961,709 3,467 (4,043,756 ) 20,908 $ 1,403,426 $ 3,647,776 $ 5,708,688 $ 1,228,501 $ (7,865,442 ) $ 4,122,949 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable $ (465,247 ) $ (900,579 ) $ 1,435,850 $ 23,927 $ 38,005 $ 131,956 Accrued compensation and related liabilities — 34,861 14,730 3,427 — 53,018 Accrued liabilities — 78,561 205,269 11,015 — 294,845 Income taxes, current — 7,042 40,759 (161 ) — 47,640 Deferred tax (asset) liability — (421 ) 96,143 7,688 — 103,410 Deferred tax liability associated with the investment in Shred-it — 69,100 — 9,357 — 78,457 Long-term debt due within one year — 250,317 (317 ) — — 250,000 Total current liabilities (465,247 ) (461,119 ) 1,792,434 55,253 38,005 959,326 Long-term liabilities: Long-term debt due after one year — 1,058,135 (8,725 ) 590 — 1,050,000 Deferred income taxes — (69,104 ) 229,712 (11,815 ) — 148,793 Accrued liabilities — — 115,362 799 — 116,161 Total long-term liabilities — 989,031 336,349 (10,426 ) — 1,314,954 Total shareholders’ equity 1,868,673 3,119,864 3,579,905 1,183,674 (7,903,447 ) 1,848,669 $ 1,403,426 $ 3,647,776 $ 5,708,688 $ 1,228,501 $ (7,865,442 ) $ 4,122,949 Condensed Consolidating Balance Sheet As of May 31, 2015 (In thousands) Cintas Corporation Corp. 2 Subsidiary Guarantors Non- Guarantors Eliminations Cintas Corporation Consolidated Assets Current assets: Cash and cash equivalents $ — $ 74,145 $ 249,203 $ 93,725 $ — $ 417,073 Marketable securities — — — 16,081 — 16,081 Accounts receivable, net — 358,560 104,964 32,606 — 496,130 Inventories, net — 193,594 21,149 8,870 2,598 226,211 Uniforms and other rental items in service — 399,017 117,473 36,478 (18,963 ) 534,005 Income taxes, current — 1,191 (339 ) 84 — 936 Assets held for sale — 21,341 — — — 21,341 Prepaid expenses and other current assets — 5,514 17,492 1,024 — 24,030 Total current assets — 1,053,362 509,942 188,868 (16,365 ) 1,735,807 Property and equipment, at cost, net — 523,690 275,072 72,659 — 871,421 Investments 321,083 1,956,320 895,393 956,461 (3,799,565 ) 329,692 Goodwill — — 1,180,527 15,197 (112 ) 1,195,612 Service contracts, net — 42,400 34 — — 42,434 Other assets, net 1,154,596 12,373 2,741,950 3,572 (3,894,997 ) 17,494 $ 1,475,679 $ 3,588,145 $ 5,602,918 $ 1,236,757 $ (7,711,039 ) $ 4,192,460 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable $ (465,247 ) $ (877,042 ) $ 1,391,999 $ 21,876 $ 38,021 $ 109,607 Accrued compensation and related liabilities — 59,752 23,989 4,682 — 88,423 Accrued liabilities — 65,022 232,500 13,137 (724 ) 309,935 Deferred tax (asset) liability — (299 ) 104,663 8,025 — 112,389 Liabilities held for sale — 704 — — — 704 Long-term debt due within one year — 293 (293 ) — — — Total current liabilities (465,247 ) (751,570 ) 1,752,858 47,720 37,297 621,058 Long-term liabilities: Long-term debt due after one year — 1,308,452 (9,766 ) 590 724 1,300,000 Deferred income taxes — (5 ) 229,266 (2,323 ) — 226,938 Accrued liabilities — — 111,105 904 — 112,009 Total long-term liabilities — 1,308,447 330,605 (829 ) 724 1,638,947 Total shareholders’ equity 1,940,926 3,031,268 3,519,455 1,189,866 (7,749,060 ) 1,932,455 $ 1,475,679 $ 3,588,145 $ 5,602,918 $ 1,236,757 $ (7,711,039 ) $ 4,192,460 Condensed Consolidating Statement of Cash Flows Three Months Ended August 31, 2015 (In thousands) Cintas Corporation Corp. 2 Subsidiary Guarantors Non- Guarantors Eliminations Cintas Corporation Consolidated Cash flows from operating activities: Net income $ 100,181 $ 27,628 $ 71,643 $ 2,533 $ (101,804 ) $ 100,181 Adjustments to reconcile net income to net cash provided by (used in) operating activities Depreciation — 21,427 12,340 2,398 — 36,165 Amortization of intangible assets — 3,513 40 50 — 3,603 Stock-based compensation 23,917 — — — — 23,917 Gain on sale of Storage Assets — (4,843 ) — — — (4,843 ) Loss on investment in Shred-it Partnership — 13,427 — 1,089 — 14,516 Deferred income taxes — 21 5,784 (173 ) — 5,632 Changes in current assets and liabilities, net of acquisitions of businesses: Accounts receivable, net — (19,744 ) (1,038 ) 1,527 — (19,255 ) Inventories, net — (8,856 ) (1,130 ) (334 ) 2,211 (8,109 ) Uniforms and other rental items in service — (3,076 ) (586 ) (700 ) (577 ) (4,939 ) Prepaid expenses and other current assets — (100 ) (5,998 ) 74 — (6,024 ) Accounts payable — 28,715 (14,970 ) 1,802 (16 ) 15,531 Accrued compensation and related liabilities — (24,891 ) (9,258 ) (1,430 ) — (35,579 ) Accrued liabilities and other — (1,775 ) (22,975 ) (2,227 ) 724 (26,253 ) Income taxes, current — 8,231 40,411 (102 ) — 48,540 Net cash provided by (used in) operating activities 124,098 39,677 74,263 4,507 (99,462 ) 143,083 Cash flows from investing activities: Capital expenditures — (29,695 ) (29,617 ) (3,319 ) — (62,631 ) Proceeds from redemption of marketable securities — — — 152,907 — 152,907 Purchase of marketable securities and investments — 2,215 (10,148 ) (192,097 ) 4,010 (196,020 ) Proceeds from sale of Storage Assets — 24,395 — — — 24,395 Acquisitions of businesses, net of cash acquired — (96,353 ) — (25,081 ) — (121,434 ) Other, net 85,656 59,519 (239,160 ) (1,270 ) 96,176 921 Net cash provided by (used in) investing activities 85,656 (39,919 ) (278,925 ) (68,860 ) 100,186 (201,862 ) Cash flows from financing activities: Proceeds from issuance of debt — — (55 ) 55 — — Repayment of debt — (309 ) 853 164 (724 ) (16 ) Exercise of stock-based compensation awards 11,844 — — — — 11,844 Repurchase of common stock (221,598 ) — — — — (221,598 ) Other, net — 488 — (437 ) — 51 Net cash (used in) provided by financing activities (209,754 ) 179 798 (218 ) (724 ) (209,719 ) Effect of exchange rate changes on cash and cash equivalents — — — (1,715 ) — (1,715 ) Net decrease in cash and cash equivalents — (63 ) (203,864 ) (66,286 ) — (270,213 ) Cash and cash equivalents at beginning of period — 74,145 249,203 93,725 — 417,073 Cash and cash equivalents at end of period $ — $ 74,082 $ 45,339 $ 27,439 $ — $ 146,860 Condensed Consolidating Statement of Cash Flows Three Months Ended August 31, 2014 (In thousands) Cintas Corporation Corp. 2 Subsidiary Guarantors Non- Guarantors Eliminations Cintas Corporation Consolidated Cash flows from operating activities: Net income $ 110,108 $ 33,150 $ 75,016 $ 3,177 $ (111,343 ) $ 110,108 Adjustments to reconcile net income to net cash provided by (used in) operating activities Depreciation — 19,547 13,037 2,864 — 35,448 Amortization of intangible assets — 3,773 15 418 — 4,206 Stock-based compensation 12,280 — — — — 12,280 Gain on deconsolidation of Shredding — (6,619 ) — — — (6,619 ) Gain on sale of stock of an equity method investment — — (21,739 ) — — (21,739 ) Deferred income taxes — — 2,083 25 — 2,108 Changes in current assets and liabilities, net of acquisitions of businesses: Accounts receivable, net — 10,014 (3,852 ) 2,060 — 8,222 Inventories, net — (1,045 ) 2,430 (1,174 ) 1,166 1,377 Uniforms and other rental items in service — (4,450 ) (1,673 ) (1,053 ) 64 (7,112 ) Prepaid expenses and other current assets — 200 (6,288 ) 204 — (5,884 ) Accounts payable — (70,520 ) 71,606 (2,415 ) 4 (1,325 ) Accrued compensation and related liabilities — (28,267 ) (10,204 ) (2,791 ) — (41,262 ) Accrued liabilities and other — (31,741 ) 42,084 (705 ) 746 10,384 Income taxes, current — 6,913 40,601 495 — 48,009 Net cash provided by (used in) operating activities 122,388 (69,045 ) 203,116 1,105 (109,363 ) 148,201 Cash flows from investing activities: Capital expenditures — (22,686 ) (42,239 ) (3,125 ) — (68,050 ) Purchase of marketable securities and investments — (1,721 ) (15,260 ) — 10,000 (6,981 ) Proceeds from Shredding Transaction, net of cash contributed — 3,344 — — — 3,344 Proceeds from sale of stock of an equity method investment — — 29,933 — — 29,933 Dividends received on equity method investment — — 5,247 — — 5,247 Acquisitions of businesses, net of cash acquired — (2,328 ) — — — (2,328 ) Other, net (80,725 ) 94,602 (114,793 ) 823 100,109 16 Net cash (used in) provided by investing activities (80,725 ) 71,211 (137,112 ) (2,302 ) 110,109 (38,819 ) Cash flows from financing activities: Repayment of debt — (450 ) 1,116 (100 ) (746 ) (180 ) Exercise of stock-based compensation awards 13,623 — — — — 13,623 Repurchase of common stock (61,439 ) — — — — (61,439 ) Other, net 6,153 488 — 157 — 6,798 Net cash (used in) provided by financing activities (41,663 ) 38 1,116 57 (746 ) (41,198 ) Effect of exchange rate changes on cash and cash equivalents — — — (19 ) — (19 ) Net increase (decrease) in cash and cash equivalents — 2,204 67,120 (1,159 ) — 68,165 Cash and cash equivalents at beginning of period — 73,540 399,525 40,223 — 513,288 Cash and cash equivalents at end of period $ — $ 75,744 $ 466,645 $ 39,064 $ — $ 581,453 |
Subsequent Event
Subsequent Event | 3 Months Ended |
Aug. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event On October 1, 2015, we announced that we completed the previously announced transaction to sell our investment in Shred-it to Stericycle, Inc. Cintas’ share of the proceeds are $578.0 million . Cintas also has the opportunity to receive up to $34.0 million in additional consideration in the future, subject to certain holdback provisions. The financial impact of this transaction will be reflected in our second quarter results. |
New Accounting Pronouncements (
New Accounting Pronouncements (Policies) | 3 Months Ended |
Aug. 31, 2015 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements | In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, ‘‘Revenue from Contracts with Customers (Topic 606),’’ to clarify revenue recognition principles. This guidance is intended to improve disclosure requirements and enhance the comparability of revenue recognition practices. Improved disclosures under the amended guidance relate to the nature, amount, timing and uncertainty of revenue that is recognized from contracts with customers. This guidance will be effective for reporting periods beginning after December 15, 2017 and will be required to be applied retrospectively. Early application of the amendments in this update is not permitted. Cintas is currently evaluating the impact that ASU 2014-09 will have on its consolidated condensed financial statements. In April 2014, the FASB issued ASU 2014-08, “ Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” which amended accounting guidance related to the reporting of discontinued operations and disclosures of disposals of components of an entity. The amended guidance changes the thresholds for disposals to qualify as discontinued operations and requires additional disclosures. This guidance is effective for reporting periods beginning after December 15, 2014 and is required to be applied prospectively. Cintas has adopted ASU 2014-08 during the quarter ended August 31, 2015 and has applied this amended accounting guidance to its investment in Shred-it and will apply it to future transactions, as appropriate. No other new accounting pronouncement recently issued or newly effective had or is expected to have a material impact on the Consolidated Condensed Financial Statements. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 3 Months Ended |
Aug. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Inventory | Inventory is comprised of the following amounts at: (In thousands) August 31, May 31, Raw materials $ 17,783 $ 16,935 Work in process 18,285 17,079 Finished goods 203,978 192,197 $ 240,046 $ 226,211 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Aug. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Financial Instruments Measured on a Recurring Basis | These financial instruments measured at fair value on a recurring basis are summarized below: As of August 31, 2015 (In thousands) Level 1 Level 2 Level 3 Fair Value Cash and cash equivalents $ 146,860 $ — $ — $ 146,860 Marketable securities: Canadian treasury securities — 53,354 — 53,354 Total assets at fair value $ 146,860 $ 53,354 $ — $ 200,214 As of May 31, 2015 (In thousands) Level 1 Level 2 Level 3 Fair Value Cash and cash equivalents $ 417,073 $ — $ — $ 417,073 Marketable securities: Canadian treasury securities — 16,081 — 16,081 Total assets at fair value $ 417,073 $ 16,081 $ — $ 433,154 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Aug. 31, 2015 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share from continuing operations using the two-class method for amounts attributable to Cintas’ common shares: Three Months Ended (In thousands except per share data) August 31, August 31, Basic Earnings per Share from Continuing Operations Income from continuing operations $ 106,198 $ 105,905 Less: income from continuing operations allocated to participating securities 1,742 591 Income from continuing operations available to common shareholders $ 104,456 $ 105,314 Basic weighted average common shares outstanding 110,597 116,659 Basic earnings per share from continuing operations $ 0.94 $ 0.90 Three Months Ended (In thousands except per share data) August 31, August 31, Diluted Earnings per Share from Continuing Operations Income from continuing operations $ 106,198 $ 105,905 Less: income from continuing operations allocated to participating securities 1,742 591 Income from continuing operations available to common shareholders $ 104,456 $ 105,314 Basic weighted average common shares outstanding 110,597 116,659 Effect of dilutive securities – employee stock options 1,632 1,371 Diluted weighted average common shares outstanding 112,229 118,030 Diluted earnings per share from continuing operations $ 0.93 $ 0.89 |
Goodwill, Service Contracts a27
Goodwill, Service Contracts and Other Assets (Tables) | 3 Months Ended |
Aug. 31, 2015 | |
Goodwill, Service Contracts and Other Assets [Abstract] | |
Changes in Carrying Amount of Goodwill by Operating Segment | Changes in the carrying amount of goodwill and service contracts for the three months ended August 31, 2015 , by reportable operating segment and all other, are as follows: Goodwill (in thousands) Uniform Rental and Facility Services First Aid and Safety Services All Other Total Balance as of June 1, 2015 $ 943,909 $ 154,954 $ 96,749 $ 1,195,612 Goodwill acquired — 77,630 54 77,684 Foreign currency translation (757 ) — (36 ) (793 ) Balance as of August 31, 2015 $ 943,152 $ 232,584 $ 96,767 $ 1,272,503 |
Changes in the Carrying Amount of Service Contracts by Operating Segment | Service Contracts (in thousands) Uniform Rental and Facility Services First Aid and Safety Services All Other Total Balance as of June 1, 2015 $ 6,677 $ 1,576 $ 34,181 $ 42,434 Service contracts acquired — 34,970 940 35,910 Service contracts amortization (1,088 ) (439 ) (1,511 ) (3,038 ) Balance as of August 31, 2015 $ 5,589 $ 36,107 $ 33,610 $ 75,306 |
Information Regarding Service Contracts and Other Assets | Information regarding Cintas’ service contracts and other assets is as follows: As of August 31, 2015 (In thousands) Carrying Amount Accumulated Amortization Net Service contracts $ 375,647 $ 300,341 $ 75,306 Noncompete and consulting agreements $ 42,290 $ 40,483 $ 1,807 Other 27,013 7,912 19,101 Total other assets $ 69,303 $ 48,395 $ 20,908 As of May 31, 2015 (In thousands) Carrying Amount Accumulated Amortization Net Service contracts $ 340,816 $ 298,382 $ 42,434 Noncompete and consulting agreements $ 41,828 $ 40,379 $ 1,449 Other 23,595 7,550 16,045 Total other assets $ 65,423 $ 47,929 $ 17,494 |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Aug. 31, 2015 | |
Business Combinations [Abstract] | |
Schedule of Assets Acquired and Liabilities Assumed | The assets acquired and liabilities assumed are valued at the estimated fair value at the acquisition date as required by GAAP. (In thousands) Assets: Cash and cash equivalents $ 431 Accounts receivable 17,310 Inventory 6,195 Other current assets 1,477 Property, plant and equipment 1,354 Goodwill 77,630 Service contracts 34,970 Other intangibles 4,500 Liabilities: Accounts payable (7,342 ) Accrued liabilities (2,525 ) Total Consideration $ 134,000 |
Accumulated Other Comprehensi29
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Aug. 31, 2015 | |
Equity [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Income (Loss) | The following table summarizes the changes in the accumulated balances for each component of accumulated other comprehensive income (loss), net of tax: (In thousands) Foreign Currency Unrealized Loss on Derivatives Other Total Balance at June 1, 2015 $ 2,987 $ (10,626 ) $ (832 ) $ (8,471 ) Other comprehensive loss before reclassifications (12,013 ) — (8 ) (12,021 ) Amounts reclassified from accumulated other comprehensive income (loss) — 488 — 488 Net current period other comprehensive (loss) income (12,013 ) 488 (8 ) (11,533 ) Balance at August 31, 2015 (9,026 ) (10,138 ) (840 ) (20,004 ) (In thousands) Foreign Currency Unrealized Loss on Derivatives Other Total Balance at June 1, 2014 $ 41,525 $ (12,615 ) $ (482 ) $ 28,428 Other comprehensive (loss) income before reclassifications (2,115 ) 17 — (2,098 ) Amounts reclassified from accumulated other comprehensive income (loss) — 488 — 488 Net current period other comprehensive (loss) income (2,115 ) 505 — (1,610 ) Balance at August 31, 2014 39,410 (12,110 ) (482 ) 26,818 |
Schedule of Reclassifications Out of Accumulated Other Comprehensive (Loss) Income | The following table summarizes the reclassifications out of accumulated other comprehensive (loss) income: Reclassifications out of Accumulated Other Comprehensive (Loss) Income Details about Accumulated Other Comprehensive (Loss) Income Components Amount Reclassified from Accumulated Other Comprehensive (Loss) Income Affected Line in the Consolidated Condensed Statements of Income Three Months Ended (In thousands) August 31, 2015 August 31, 2014 Amortization of interest rate locks $ (783 ) $ (783 ) Interest expense Tax benefit 295 295 Income taxes Amortization of interest rate locks, net of tax $ (488 ) $ (488 ) Net of tax |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Aug. 31, 2015 | |
Segment Reporting [Abstract] | |
Information Related to Operating Segments | Information related to the operations of Cintas’ operating segments is set forth below: (In thousands) Uniform Rental and Facility Services First Aid and Safety Services All Other Corporate (1) Total As of and for the three months ended August 31, 2015 Revenue $ 938,408 $ 99,488 $ 160,994 $ — $ 1,198,890 Income (loss) before income taxes $ 165,381 $ 8,592 $ 11,534 $ (16,293 ) $ 169,214 Total assets $ 2,870,622 $ 398,237 $ 342,712 $ 511,378 $ 4,122,949 As of and for the three months ended August 31, 2014 Revenue $ 873,698 $ 79,924 $ 148,455 $ — $ 1,102,077 Income before income taxes $ 144,816 $ 9,147 $ 9,525 $ 5,209 $ 168,697 Total assets $ 2,861,790 $ 260,580 $ 354,260 $ 1,079,640 $ 4,556,270 (1) Corporate assets as of August 31, 2015 include the investment in Shred-it, which is classified as held for sale. Corporate assets as of August 31, 2014 include the assets of Storage, which was classified as held for sale, and the investment in Shred-it. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 3 Months Ended |
Aug. 31, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | Following is selected financial information included in net (loss) income from discontinued operations for Shred-it, Shredding and the Storage business: Three Months Ended (In thousands) August 31, August 31, Revenue $ — $ 20,785 Income before income taxes 237 575 Income tax expense (85 ) (240 ) Gain on sale of Storage Assets 4,843 — Loss on investment in Shred-it Partnership (14,516 ) — Gain on the deconsolidation of Shredding (1) — 6,619 Income tax benefit (expense) on (loss) gain 3,504 (2,751 ) Net (loss) income from discontinued operations $ (6,017 ) $ 4,203 (1) Results for the three months ended August 31, 2014 related to the gain on the deconsolidation of Shredding were previously presented in continuing operations and were reclassified to discontinued operations as previously discussed. |
Supplemental Guarantor Inform32
Supplemental Guarantor Information (Tables) | 3 Months Ended |
Aug. 31, 2015 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Consolidating Income Statement | Condensed Consolidating Income Statement Three Months Ended August 31, 2015 (In thousands) Cintas Corp. 2 Subsidiary Non- Eliminations Cintas Corporation Consolidated Revenue: Uniform rental and facility services $ — $ 721,329 $ 202,265 $ 54,012 $ (39,198 ) $ 938,408 Other — 372,611 1,293 14,811 (128,233 ) 260,482 Equity in net income of affiliates 106,198 — — — (106,198 ) — 106,198 1,093,940 203,558 68,823 (273,629 ) 1,198,890 Costs and expenses (income): Cost of uniform rental and facility services — 440,580 116,832 37,357 (76,266 ) 518,503 Cost of other — 237,369 (8,643 ) 9,570 (82,053 ) 156,243 Selling and administrative expenses — 347,076 (18,855 ) 17,880 (7,464 ) 338,637 Operating income 106,198 68,915 114,224 4,016 (107,846 ) 185,507 Interest income — — (48 ) (71 ) — (119 ) Interest expense (income) — 16,375 38 (1 ) — 16,412 Income before income taxes 106,198 52,540 114,234 4,088 (107,846 ) 169,214 Income taxes — 19,589 42,591 861 (25 ) 63,016 Income from continuing operations 106,198 32,951 71,643 3,227 (107,821 ) 106,198 Loss from discontinued operations, net of tax (6,017 ) (5,323 ) — (694 ) 6,017 (6,017 ) Net income $ 100,181 $ 27,628 $ 71,643 $ 2,533 $ (101,804 ) $ 100,181 Condensed Consolidating Income Statement Three Months Ended August 31, 2014 (In thousands) Cintas Corp. 2 Subsidiary Non- Eliminations Cintas Corporation Consolidated Revenue: Uniform rental and facility services $ — $ 665,874 $ 183,181 $ 59,861 $ (35,218 ) $ 873,698 Other — 336,480 481 13,744 (122,326 ) 228,379 Equity in net income of affiliates 105,905 — — — (105,905 ) — 105,905 1,002,354 183,662 73,605 (263,449 ) 1,102,077 Costs and expenses (income): Cost of uniform rental and facility services — 408,371 110,922 40,282 (68,900 ) 490,675 Cost of other — 217,942 (10,657 ) 8,957 (82,786 ) 133,456 Selling and administrative expenses — 314,002 (14,006 ) 19,074 (4,612 ) 314,458 Operating income 105,905 62,039 97,403 5,292 (107,151 ) 163,488 Gain on sale of stock of an equity method investment — — 21,739 — — 21,739 Interest income — (5 ) (48 ) — — (53 ) Interest expense — 16,409 170 4 — 16,583 Income before income taxes 105,905 45,635 119,020 5,288 (107,151 ) 168,697 Income taxes — 16,748 44,004 2,051 (11 ) 62,792 Income from continuing operations 105,905 28,887 75,016 3,237 (107,140 ) 105,905 Income (loss) from discontinued operations, net of tax 4,203 4,263 — (60 ) (4,203 ) 4,203 Net income $ 110,108 $ 33,150 $ 75,016 $ 3,177 $ (111,343 ) $ 110,108 |
Condensed Consolidating Statement of Comprehensive Income | Condensed Consolidating Statement of Comprehensive Income Three Months Ended August 31, 2015 (In thousands) Cintas Corp. 2 Subsidiary Non- Eliminations Cintas Corporation Consolidated Net income $ 100,181 $ 27,628 $ 71,643 $ 2,533 $ (101,804 ) $ 100,181 Other comprehensive (loss) income, net of tax: Foreign currency translation adjustments — — — (12,013 ) — (12,013 ) Amortization of interest rate lock agreements — 488 — — — 488 Change in fair value of available-for-sale securities — — — (8 ) — (8 ) Other comprehensive income (loss) — 488 — (12,021 ) — (11,533 ) Comprehensive income (loss) $ 100,181 $ 28,116 $ 71,643 $ (9,488 ) $ (101,804 ) $ 88,648 Condensed Consolidating Statement of Comprehensive Income Three Months Ended August 31, 2014 (In thousands) Cintas Corp. 2 Subsidiary Non- Eliminations Cintas Corporation Consolidated Net income $ 110,108 $ 33,150 $ 75,016 $ 3,177 $ (111,343 ) $ 110,108 Other comprehensive (loss) income, net of tax: Foreign currency translation adjustments — — — (2,115 ) — (2,115 ) Change in fair value of derivatives — — — 17 — 17 Amortization of interest rate lock agreements — 488 — — — 488 Other comprehensive income (loss) — 488 — (2,098 ) — (1,610 ) Comprehensive income $ 110,108 $ 33,638 $ 75,016 $ 1,079 $ (111,343 ) $ 108,498 |
Condensed Consolidating Balance Sheet | Condensed Consolidating Balance Sheet As of August 31, 2015 (In thousands) Cintas Corporation Corp. 2 Subsidiary Guarantors Non- Guarantors Eliminations Cintas Corporation Consolidated Assets Current assets: Cash and cash equivalents $ — $ 74,082 $ 45,339 $ 27,439 $ — $ 146,860 Marketable securities — — — 53,354 — 53,354 Accounts receivable, net — 392,911 106,001 32,215 — 531,127 Inventories, net — 207,755 22,280 9,624 387 240,046 Uniforms and other rental items in service — 402,093 118,059 35,354 (18,386 ) 537,120 Assets held for sale — 171,106 — 23,169 — 194,275 Prepaid expenses and other current assets — 6,626 23,490 1,054 — 31,170 Total current assets — 1,254,573 315,169 182,209 (17,999 ) 1,733,952 Property and equipment, at cost, net — 533,178 292,341 71,267 — 896,786 Investments 321,083 1,769,572 900,288 936,126 (3,803,575 ) 123,494 Goodwill — — 1,239,155 33,460 (112 ) 1,272,503 Service contracts, net — 73,308 26 1,972 — 75,306 Other assets, net 1,082,343 17,145 2,961,709 3,467 (4,043,756 ) 20,908 $ 1,403,426 $ 3,647,776 $ 5,708,688 $ 1,228,501 $ (7,865,442 ) $ 4,122,949 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable $ (465,247 ) $ (900,579 ) $ 1,435,850 $ 23,927 $ 38,005 $ 131,956 Accrued compensation and related liabilities — 34,861 14,730 3,427 — 53,018 Accrued liabilities — 78,561 205,269 11,015 — 294,845 Income taxes, current — 7,042 40,759 (161 ) — 47,640 Deferred tax (asset) liability — (421 ) 96,143 7,688 — 103,410 Deferred tax liability associated with the investment in Shred-it — 69,100 — 9,357 — 78,457 Long-term debt due within one year — 250,317 (317 ) — — 250,000 Total current liabilities (465,247 ) (461,119 ) 1,792,434 55,253 38,005 959,326 Long-term liabilities: Long-term debt due after one year — 1,058,135 (8,725 ) 590 — 1,050,000 Deferred income taxes — (69,104 ) 229,712 (11,815 ) — 148,793 Accrued liabilities — — 115,362 799 — 116,161 Total long-term liabilities — 989,031 336,349 (10,426 ) — 1,314,954 Total shareholders’ equity 1,868,673 3,119,864 3,579,905 1,183,674 (7,903,447 ) 1,848,669 $ 1,403,426 $ 3,647,776 $ 5,708,688 $ 1,228,501 $ (7,865,442 ) $ 4,122,949 Condensed Consolidating Balance Sheet As of May 31, 2015 (In thousands) Cintas Corporation Corp. 2 Subsidiary Guarantors Non- Guarantors Eliminations Cintas Corporation Consolidated Assets Current assets: Cash and cash equivalents $ — $ 74,145 $ 249,203 $ 93,725 $ — $ 417,073 Marketable securities — — — 16,081 — 16,081 Accounts receivable, net — 358,560 104,964 32,606 — 496,130 Inventories, net — 193,594 21,149 8,870 2,598 226,211 Uniforms and other rental items in service — 399,017 117,473 36,478 (18,963 ) 534,005 Income taxes, current — 1,191 (339 ) 84 — 936 Assets held for sale — 21,341 — — — 21,341 Prepaid expenses and other current assets — 5,514 17,492 1,024 — 24,030 Total current assets — 1,053,362 509,942 188,868 (16,365 ) 1,735,807 Property and equipment, at cost, net — 523,690 275,072 72,659 — 871,421 Investments 321,083 1,956,320 895,393 956,461 (3,799,565 ) 329,692 Goodwill — — 1,180,527 15,197 (112 ) 1,195,612 Service contracts, net — 42,400 34 — — 42,434 Other assets, net 1,154,596 12,373 2,741,950 3,572 (3,894,997 ) 17,494 $ 1,475,679 $ 3,588,145 $ 5,602,918 $ 1,236,757 $ (7,711,039 ) $ 4,192,460 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable $ (465,247 ) $ (877,042 ) $ 1,391,999 $ 21,876 $ 38,021 $ 109,607 Accrued compensation and related liabilities — 59,752 23,989 4,682 — 88,423 Accrued liabilities — 65,022 232,500 13,137 (724 ) 309,935 Deferred tax (asset) liability — (299 ) 104,663 8,025 — 112,389 Liabilities held for sale — 704 — — — 704 Long-term debt due within one year — 293 (293 ) — — — Total current liabilities (465,247 ) (751,570 ) 1,752,858 47,720 37,297 621,058 Long-term liabilities: Long-term debt due after one year — 1,308,452 (9,766 ) 590 724 1,300,000 Deferred income taxes — (5 ) 229,266 (2,323 ) — 226,938 Accrued liabilities — — 111,105 904 — 112,009 Total long-term liabilities — 1,308,447 330,605 (829 ) 724 1,638,947 Total shareholders’ equity 1,940,926 3,031,268 3,519,455 1,189,866 (7,749,060 ) 1,932,455 $ 1,475,679 $ 3,588,145 $ 5,602,918 $ 1,236,757 $ (7,711,039 ) $ 4,192,460 |
Condensed Consolidating Statement of Cash Flows | Condensed Consolidating Statement of Cash Flows Three Months Ended August 31, 2015 (In thousands) Cintas Corporation Corp. 2 Subsidiary Guarantors Non- Guarantors Eliminations Cintas Corporation Consolidated Cash flows from operating activities: Net income $ 100,181 $ 27,628 $ 71,643 $ 2,533 $ (101,804 ) $ 100,181 Adjustments to reconcile net income to net cash provided by (used in) operating activities Depreciation — 21,427 12,340 2,398 — 36,165 Amortization of intangible assets — 3,513 40 50 — 3,603 Stock-based compensation 23,917 — — — — 23,917 Gain on sale of Storage Assets — (4,843 ) — — — (4,843 ) Loss on investment in Shred-it Partnership — 13,427 — 1,089 — 14,516 Deferred income taxes — 21 5,784 (173 ) — 5,632 Changes in current assets and liabilities, net of acquisitions of businesses: Accounts receivable, net — (19,744 ) (1,038 ) 1,527 — (19,255 ) Inventories, net — (8,856 ) (1,130 ) (334 ) 2,211 (8,109 ) Uniforms and other rental items in service — (3,076 ) (586 ) (700 ) (577 ) (4,939 ) Prepaid expenses and other current assets — (100 ) (5,998 ) 74 — (6,024 ) Accounts payable — 28,715 (14,970 ) 1,802 (16 ) 15,531 Accrued compensation and related liabilities — (24,891 ) (9,258 ) (1,430 ) — (35,579 ) Accrued liabilities and other — (1,775 ) (22,975 ) (2,227 ) 724 (26,253 ) Income taxes, current — 8,231 40,411 (102 ) — 48,540 Net cash provided by (used in) operating activities 124,098 39,677 74,263 4,507 (99,462 ) 143,083 Cash flows from investing activities: Capital expenditures — (29,695 ) (29,617 ) (3,319 ) — (62,631 ) Proceeds from redemption of marketable securities — — — 152,907 — 152,907 Purchase of marketable securities and investments — 2,215 (10,148 ) (192,097 ) 4,010 (196,020 ) Proceeds from sale of Storage Assets — 24,395 — — — 24,395 Acquisitions of businesses, net of cash acquired — (96,353 ) — (25,081 ) — (121,434 ) Other, net 85,656 59,519 (239,160 ) (1,270 ) 96,176 921 Net cash provided by (used in) investing activities 85,656 (39,919 ) (278,925 ) (68,860 ) 100,186 (201,862 ) Cash flows from financing activities: Proceeds from issuance of debt — — (55 ) 55 — — Repayment of debt — (309 ) 853 164 (724 ) (16 ) Exercise of stock-based compensation awards 11,844 — — — — 11,844 Repurchase of common stock (221,598 ) — — — — (221,598 ) Other, net — 488 — (437 ) — 51 Net cash (used in) provided by financing activities (209,754 ) 179 798 (218 ) (724 ) (209,719 ) Effect of exchange rate changes on cash and cash equivalents — — — (1,715 ) — (1,715 ) Net decrease in cash and cash equivalents — (63 ) (203,864 ) (66,286 ) — (270,213 ) Cash and cash equivalents at beginning of period — 74,145 249,203 93,725 — 417,073 Cash and cash equivalents at end of period $ — $ 74,082 $ 45,339 $ 27,439 $ — $ 146,860 Condensed Consolidating Statement of Cash Flows Three Months Ended August 31, 2014 (In thousands) Cintas Corporation Corp. 2 Subsidiary Guarantors Non- Guarantors Eliminations Cintas Corporation Consolidated Cash flows from operating activities: Net income $ 110,108 $ 33,150 $ 75,016 $ 3,177 $ (111,343 ) $ 110,108 Adjustments to reconcile net income to net cash provided by (used in) operating activities Depreciation — 19,547 13,037 2,864 — 35,448 Amortization of intangible assets — 3,773 15 418 — 4,206 Stock-based compensation 12,280 — — — — 12,280 Gain on deconsolidation of Shredding — (6,619 ) — — — (6,619 ) Gain on sale of stock of an equity method investment — — (21,739 ) — — (21,739 ) Deferred income taxes — — 2,083 25 — 2,108 Changes in current assets and liabilities, net of acquisitions of businesses: Accounts receivable, net — 10,014 (3,852 ) 2,060 — 8,222 Inventories, net — (1,045 ) 2,430 (1,174 ) 1,166 1,377 Uniforms and other rental items in service — (4,450 ) (1,673 ) (1,053 ) 64 (7,112 ) Prepaid expenses and other current assets — 200 (6,288 ) 204 — (5,884 ) Accounts payable — (70,520 ) 71,606 (2,415 ) 4 (1,325 ) Accrued compensation and related liabilities — (28,267 ) (10,204 ) (2,791 ) — (41,262 ) Accrued liabilities and other — (31,741 ) 42,084 (705 ) 746 10,384 Income taxes, current — 6,913 40,601 495 — 48,009 Net cash provided by (used in) operating activities 122,388 (69,045 ) 203,116 1,105 (109,363 ) 148,201 Cash flows from investing activities: Capital expenditures — (22,686 ) (42,239 ) (3,125 ) — (68,050 ) Purchase of marketable securities and investments — (1,721 ) (15,260 ) — 10,000 (6,981 ) Proceeds from Shredding Transaction, net of cash contributed — 3,344 — — — 3,344 Proceeds from sale of stock of an equity method investment — — 29,933 — — 29,933 Dividends received on equity method investment — — 5,247 — — 5,247 Acquisitions of businesses, net of cash acquired — (2,328 ) — — — (2,328 ) Other, net (80,725 ) 94,602 (114,793 ) 823 100,109 16 Net cash (used in) provided by investing activities (80,725 ) 71,211 (137,112 ) (2,302 ) 110,109 (38,819 ) Cash flows from financing activities: Repayment of debt — (450 ) 1,116 (100 ) (746 ) (180 ) Exercise of stock-based compensation awards 13,623 — — — — 13,623 Repurchase of common stock (61,439 ) — — — — (61,439 ) Other, net 6,153 488 — 157 — 6,798 Net cash (used in) provided by financing activities (41,663 ) 38 1,116 57 (746 ) (41,198 ) Effect of exchange rate changes on cash and cash equivalents — — — (19 ) — (19 ) Net increase (decrease) in cash and cash equivalents — 2,204 67,120 (1,159 ) — 68,165 Cash and cash equivalents at beginning of period — 73,540 399,525 40,223 — 513,288 Cash and cash equivalents at end of period $ — $ 75,744 $ 466,645 $ 39,064 $ — $ 581,453 |
Basis of Presentation - Invento
Basis of Presentation - Inventories (Details) - USD ($) $ in Thousands | Aug. 31, 2015 | May. 31, 2015 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Raw materials | $ 17,783 | $ 16,935 |
Work in process | 18,285 | 17,079 |
Finished goods | 203,978 | 192,197 |
Inventories, net | $ 240,046 | $ 226,211 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Instruments on a Recurring Basis (Details) - USD ($) $ in Thousands | Aug. 31, 2015 | May. 31, 2015 |
Fair value on a recurring basis | ||
Marketable securities | $ 53,354 | $ 16,081 |
Fair Value, Measurements, Recurring | ||
Fair value on a recurring basis | ||
Cash and cash equivalents | 146,860 | 417,073 |
Total assets at fair value | 200,214 | 433,154 |
Level 1 | Fair Value, Measurements, Recurring | ||
Fair value on a recurring basis | ||
Cash and cash equivalents | 146,860 | 417,073 |
Total assets at fair value | 146,860 | 417,073 |
Level 2 | Fair Value, Measurements, Recurring | ||
Fair value on a recurring basis | ||
Cash and cash equivalents | 0 | 0 |
Total assets at fair value | 53,354 | 16,081 |
Level 3 | Fair Value, Measurements, Recurring | ||
Fair value on a recurring basis | ||
Cash and cash equivalents | 0 | 0 |
Total assets at fair value | 0 | 0 |
Canadian treasury securities | Fair Value, Measurements, Recurring | ||
Fair value on a recurring basis | ||
Marketable securities | 53,354 | 16,081 |
Canadian treasury securities | Level 1 | Fair Value, Measurements, Recurring | ||
Fair value on a recurring basis | ||
Marketable securities | 0 | 0 |
Canadian treasury securities | Level 2 | Fair Value, Measurements, Recurring | ||
Fair value on a recurring basis | ||
Marketable securities | 53,354 | 16,081 |
Canadian treasury securities | Level 3 | Fair Value, Measurements, Recurring | ||
Fair value on a recurring basis | ||
Marketable securities | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Aug. 31, 2015 | May. 31, 2015 | |
Fair value on a recurring basis | ||
Contractual maturities (less than) | 1 year | 1 year |
Canadian treasury securities | ||
Fair value on a recurring basis | ||
Amortized cost basis of marketable securities | $ 53.4 | $ 16.1 |
Investments - Narrative (Detail
Investments - Narrative (Details) - USD ($) | Jun. 30, 2014 | Aug. 31, 2015 | Aug. 31, 2014 | May. 31, 2015 |
Investments, Debt and Equity Securities [Abstract] | ||||
Investments | $ 123,494,000 | $ 329,692,000 | ||
Equity method investments | 14,600,000 | 225,700,000 | ||
Cash surrender value of insurance policies | 106,700,000 | 101,800,000 | ||
Cost method investments | 2,200,000 | $ 2,200,000 | ||
Dividends received on equity method investment | $ 5,200,000 | 0 | $ 5,247,000 | |
Cash received from sale of equity method investment | $ 35,200,000 | |||
Gain on sale of stock of an equity method investment, net of tax | 13,600,000 | |||
Losses due to impairment | $ 0 | $ 0 |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
Basic Earnings per Share from Continuing Operations | ||
Income from continuing operations | $ 106,198 | $ 105,905 |
Less: income from continuing operations allocated to participating securities | 1,742 | 591 |
Income from continuing operations available to common shareholders | $ 104,456 | $ 105,314 |
Basic weighted average common shares outstanding (shares) | 110,597 | 116,659 |
Basic earnings per common share: | ||
Basic earnings per share, continuing operations (dollars per share) | $ 0.94 | $ 0.90 |
Diluted Earnings per Share from Continuing Operations | ||
Income from continuing operations | $ 106,198 | $ 105,905 |
Less: income from continuing operations allocated to participating securities | 1,742 | 591 |
Income from continuing operations available to common shareholders | $ 104,456 | $ 105,314 |
Basic weighted average common shares outstanding (shares) | 110,597 | 116,659 |
Effect of dilutive securities - employee stock options (shares) | 1,632 | 1,371 |
Diluted weighted average common shares outstanding (shares) | 112,229 | 118,030 |
Diluted earnings per share: | ||
Diluted earnings per share, continuing operations (dollars per share) | $ 0.93 | $ 0.89 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - USD ($) $ / shares in Units, shares in Millions | Aug. 04, 2015 | Oct. 09, 2015 | Aug. 31, 2015 | Aug. 31, 2014 | Sep. 30, 2015 | Jan. 13, 2015 |
Earnings Per Share, Basic and Diluted [Line Items] | ||||||
Basic and diluted (loss) earnings per share from discontinued operations (dollars per share) | $ (0.05) | $ 0.04 | ||||
Options granted and excluded from the computation of diluted earnings per share (shares) | 0.5 | 0.6 | ||||
Common stock purchased under share buyback | 1.4 | 2.4 | ||||
Common stock purchased under a share buyback, average price per share | $ 85.65 | |||||
Aggregate purchase price of common stock under a share buyback program | $ 120,000,000 | $ 202,500,000 | ||||
Employee payroll taxes due on restricted stock | ||||||
Earnings Per Share, Basic and Diluted [Line Items] | ||||||
Common stock purchased under share buyback | 0.2 | |||||
Common stock purchased under a share buyback, average price per share | $ 85.54 | |||||
Aggregate purchase price of common stock under a share buyback program | $ 19,100,000 | |||||
January 13, 2015 | ||||||
Earnings Per Share, Basic and Diluted [Line Items] | ||||||
Share buyback program, authorized amount | $ 500,000,000 | |||||
August 4, 2015 | ||||||
Earnings Per Share, Basic and Diluted [Line Items] | ||||||
Share buyback program, authorized amount | $ 500,000,000 | |||||
Subsequent Event | ||||||
Earnings Per Share, Basic and Diluted [Line Items] | ||||||
Common stock purchased under share buyback | 2.1 | 5.9 | ||||
Common stock purchased under a share buyback, average price per share | $ 84.07 | |||||
Aggregate purchase price of common stock under a share buyback program | $ 180,400,000 | $ 500,000,000 |
Goodwill, Service Contracts a39
Goodwill, Service Contracts and Other Assets - Narrative (Details) - USD ($) | 3 Months Ended | |||
Aug. 31, 2015 | Aug. 31, 2014 | Jun. 01, 2015 | May. 31, 2015 | |
Goodwill [Line Items] | ||||
Goodwill impairment | $ 0 | |||
Goodwill | 1,272,503,000 | $ 1,195,612,000 | ||
Amortization expense for continuing operations | 3,600,000 | $ 3,500,000 | ||
Estimated amortization expense, year one | 14,600,000 | |||
Estimated amortization expense, year two | 11,200,000 | |||
Estimated amortization expense, year three | 10,300,000 | |||
Estimated amortization expense, year four | 9,600,000 | |||
Estimated amortization expense, year five | 9,200,000 | |||
Uniform Rental and Facility Services | ||||
Goodwill [Line Items] | ||||
Goodwill | 943,152,000 | $ 943,900,000 | 943,909,000 | |
First Aid and Safety Services | ||||
Goodwill [Line Items] | ||||
Goodwill | 232,584,000 | 155,000,000 | 154,954,000 | |
All Other | ||||
Goodwill [Line Items] | ||||
Goodwill | $ 96,767,000 | $ 96,700,000 | $ 96,749,000 |
Goodwill, Service Contracts a40
Goodwill, Service Contracts and Other Assets - Changes in Carrying Amount of Goodwill (Details) $ in Thousands | 3 Months Ended |
Aug. 31, 2015USD ($) | |
Goodwill [Roll Forward] | |
Balance as of June 1, 2015 | $ 1,195,612 |
Goodwill acquired | 77,684 |
Foreign currency translation | (793) |
Balance as of August 31, 2015 | 1,272,503 |
Uniform Rental and Facility Services | |
Goodwill [Roll Forward] | |
Balance as of June 1, 2015 | 943,909 |
Goodwill acquired | 0 |
Foreign currency translation | (757) |
Balance as of August 31, 2015 | 943,152 |
First Aid and Safety Services | |
Goodwill [Roll Forward] | |
Balance as of June 1, 2015 | 154,954 |
Goodwill acquired | 77,630 |
Foreign currency translation | 0 |
Balance as of August 31, 2015 | 232,584 |
All Other | |
Goodwill [Roll Forward] | |
Balance as of June 1, 2015 | 96,749 |
Goodwill acquired | 54 |
Foreign currency translation | (36) |
Balance as of August 31, 2015 | $ 96,767 |
Goodwill, Service Contracts a41
Goodwill, Service Contracts and Other Assets - Changes in Carrying Amount of Service Contracts (Details) $ in Thousands | 3 Months Ended |
Aug. 31, 2015USD ($) | |
Service contracts [Roll Forward] | |
Balance as of June 1, 2015 | $ 42,434 |
Service contracts acquired | 35,910 |
Service contracts amortization | (3,038) |
Balance as of August 31, 2015 | 75,306 |
Uniform Rental and Facility Services | |
Service contracts [Roll Forward] | |
Balance as of June 1, 2015 | 6,677 |
Service contracts acquired | 0 |
Service contracts amortization | (1,088) |
Balance as of August 31, 2015 | 5,589 |
First Aid and Safety Services | |
Service contracts [Roll Forward] | |
Balance as of June 1, 2015 | 1,576 |
Service contracts acquired | 34,970 |
Service contracts amortization | (439) |
Balance as of August 31, 2015 | 36,107 |
All Other | |
Service contracts [Roll Forward] | |
Balance as of June 1, 2015 | 34,181 |
Service contracts acquired | 940 |
Service contracts amortization | (1,511) |
Balance as of August 31, 2015 | $ 33,610 |
Goodwill, Service Contracts a42
Goodwill, Service Contracts and Other Assets - Information Regarding Service Contracts and Other Assets (Details) - USD ($) $ in Thousands | Aug. 31, 2015 | May. 31, 2015 |
Information regarding service contracts and other assets | ||
Service contracts, net | $ 75,306 | $ 42,434 |
Other assets, carrying amount | 69,303 | 65,423 |
Other assets, accumulated amortization | 48,395 | 47,929 |
Other assets, net | 20,908 | 17,494 |
Noncompete and consulting agreements | ||
Information regarding service contracts and other assets | ||
Other assets, carrying amount | 42,290 | 41,828 |
Other assets, accumulated amortization | 40,483 | 40,379 |
Other assets, net | 1,807 | 1,449 |
Other | ||
Information regarding service contracts and other assets | ||
Other assets, carrying amount | 27,013 | 23,595 |
Other assets, accumulated amortization | 7,912 | 7,550 |
Other assets, net | 19,101 | 16,045 |
Service Contracts | ||
Information regarding service contracts and other assets | ||
Service contracts, carrying amount | 375,647 | 340,816 |
Service contracts, accumulated amortization | 300,341 | 298,382 |
Service contracts, net | $ 75,306 | $ 42,434 |
Debt, Derivatives and Hedging43
Debt, Derivatives and Hedging Activities (Details) - USD ($) | 3 Months Ended | ||
Aug. 31, 2015 | Aug. 31, 2014 | May. 31, 2015 | |
Line of Credit Facility [Line Items] | |||
Commercial paper program availability | $ 300,000,000 | ||
Revolving credit facility, maximum borrowing capacity with accordion feature | 450,000,000 | ||
Revolving credit facility amount outstanding | 0 | $ 0 | |
Amortization of interest rate lock agreements | 488,000 | $ 488,000 | |
Level 2 | Foreign Exchange Forward | Fair Value, Measurements, Recurring | |||
Line of Credit Facility [Line Items] | |||
Current accrued liabilities for foreign currency forward contracts | 0 | ||
Unsecured Debt | |||
Line of Credit Facility [Line Items] | |||
Long-term debt, carrying amount | 1,300,000,000 | 1,300,000,000 | |
Long-term debt, fair value | $ 1,415,100,000 | $ 1,418,600,000 |
Income Taxes (Details)
Income Taxes (Details) $ in Millions | 3 Months Ended |
Aug. 31, 2015USD ($) | |
Income Tax Disclosure [Abstract] | |
Unrecognized tax benefits, period increase | $ 0.5 |
Unrecognized tax benefits, increase in accrued interest (less than) | 0.1 |
Decrease in unrecognized tax benefit reasonably possible in the next twelve months | $ 3.4 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - ZEE Medical, Inc. | Aug. 01, 2015USD ($) |
Business Acquisition [Line Items] | |
Consideration transferred | $ 134,000,000 |
Cash consideration | 120,600,000 |
Contingent consideration subject to holdback provisions | 13,400,000 |
Goodwill expected to be deductible for income tax purposes | $ 0 |
Goodwill, Service Contracts and Other Intangibles | Level 3 | |
Business Acquisition [Line Items] | |
Discount rate | 11.00% |
Acquisitions - Schedule of Asse
Acquisitions - Schedule of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Aug. 31, 2015 | Aug. 01, 2015 | May. 31, 2015 |
Assets: | |||
Goodwill | $ 1,272,503 | $ 1,195,612 | |
ZEE Medical, Inc. | |||
Assets: | |||
Cash and cash equivalents | $ 431 | ||
Accounts receivable | 17,310 | ||
Inventory | 6,195 | ||
Other current assets | 1,477 | ||
Property, plant and equipment | 1,354 | ||
Goodwill | 77,630 | ||
Liabilities: | |||
Accounts payable | (7,342) | ||
Accrued liabilities | (2,525) | ||
Total Consideration | 134,000 | ||
Service contracts | ZEE Medical, Inc. | |||
Assets: | |||
Intangible Assets | 34,970 | ||
Other intangibles | ZEE Medical, Inc. | |||
Assets: | |||
Intangible Assets | $ 4,500 |
Litigation and Other Continge47
Litigation and Other Contingencies (Details) | 1 Months Ended |
Sep. 30, 2010individual | |
Serrano lawsuit | |
Loss Contingencies [Line Items] | |
Number of plaintiffs (individual) | 13 |
Accumulated Other Comprehensi48
Accumulated Other Comprehensive Income (Loss) - Changes in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning Balance | $ (8,471) | $ 28,428 |
Other comprehensive loss before reclassifications | (12,021) | (2,098) |
Amounts reclassified from accumulated other comprehensive income (loss) | 488 | 488 |
Other comprehensive loss | (11,533) | (1,610) |
Ending Balance | (20,004) | 26,818 |
Foreign Currency | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning Balance | 2,987 | 41,525 |
Other comprehensive loss before reclassifications | (12,013) | (2,115) |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 |
Other comprehensive loss | (12,013) | (2,115) |
Ending Balance | (9,026) | 39,410 |
Unrealized Loss on Derivatives | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning Balance | (10,626) | (12,615) |
Other comprehensive loss before reclassifications | 0 | 17 |
Amounts reclassified from accumulated other comprehensive income (loss) | 488 | 488 |
Other comprehensive loss | 488 | 505 |
Ending Balance | (10,138) | (12,110) |
Other | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning Balance | (832) | (482) |
Other comprehensive loss before reclassifications | (8) | 0 |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 |
Other comprehensive loss | (8) | 0 |
Ending Balance | $ (840) | $ (482) |
Accumulated Other Comprehensi49
Accumulated Other Comprehensive Income (Loss) - Reclassifications Out of Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
Equity [Abstract] | ||
Amortization of interest rate locks | $ (783) | $ (783) |
Tax benefit | 295 | 295 |
Amortization of interest rate locks, net of tax | $ (488) | $ (488) |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | |||
Aug. 31, 2015USD ($) | May. 31, 2015USD ($)segment | Aug. 31, 2014USD ($) | ||
Segment Reporting Information | ||||
Number of operating segments | segment | 3 | |||
Revenue | $ 1,198,890 | $ 1,102,077 | ||
Income before income taxes | 169,214 | 168,697 | ||
Total assets | 4,122,949 | $ 4,192,460 | 4,556,270 | |
Operating Segments | Uniform Rental and Facility Services | ||||
Segment Reporting Information | ||||
Revenue | 938,408 | 873,698 | ||
Income before income taxes | 165,381 | 144,816 | ||
Total assets | 2,870,622 | 2,861,790 | ||
Operating Segments | First Aid and Safety Services | ||||
Segment Reporting Information | ||||
Revenue | 99,488 | 79,924 | ||
Income before income taxes | 8,592 | 9,147 | ||
Total assets | 398,237 | 260,580 | ||
Operating Segments | All Other | ||||
Segment Reporting Information | ||||
Revenue | 160,994 | 148,455 | ||
Income before income taxes | 11,534 | 9,525 | ||
Total assets | 342,712 | 354,260 | ||
Corporate | ||||
Segment Reporting Information | ||||
Revenue | [1] | 0 | 0 | |
Income before income taxes | [1] | (16,293) | 5,209 | |
Total assets | [1] | $ 511,378 | $ 1,079,640 | |
[1] | Corporate assets as of August 31, 2015 include the investment in Shred-it, which is classified as held for sale. Corporate assets as of August 31, 2014 include the assets of Storage, which was classified as held for sale, and the investment in Shred-it. |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) $ in Thousands | 3 Months Ended | ||
Aug. 31, 2015USD ($)transactionbuyer | Aug. 31, 2014USD ($) | May. 31, 2015USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Equity method investments | $ 14,600 | $ 225,700 | |
Gain on sale of stock of an equity method investment, net of tax | $ 13,600 | ||
Proceeds from sale of Storage Assets | $ 24,395 | 0 | |
Discontinued Operations | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of transactions involved in sale of business | transaction | 3 | ||
Number of buyers involved in sale of business | buyer | 3 | ||
Proceeds from sale of Storage Assets | $ 24,400 | ||
Gain on sale of business, net of tax | 3,100 | ||
Shred-it | Discontinued Operations | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Equity method investments | 194,300 | $ 210,100 | |
Difference between carrying amount and underlying equity in net assets | $ 91,200 | ||
Amortization period of basis difference | 9 years | ||
Loss on investment in Shred-it, net of tax | $ 9,300 | ||
Amortization of basis difference | $ 2,800 | ||
Gain on sale of stock of an equity method investment, net of tax | $ 3,900 |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Discontinued Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Aug. 31, 2015 | Aug. 31, 2014 | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Income tax expense | $ 3,419 | $ (2,991) | |
Gain on sale of Storage Assets | 4,843 | 0 | |
Loss on investment in Shred-it Partnership | (14,516) | 0 | |
Gain on the deconsolidation of Shredding | 0 | 6,619 | |
Net (loss) income from discontinued operations | (6,017) | 4,203 | |
Discontinued Operations | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Revenue | 0 | 20,785 | |
Income before income taxes | 237 | 575 | |
Income tax expense | (85) | (240) | |
Gain on sale of Storage Assets | 4,843 | 0 | |
Loss on investment in Shred-it Partnership | (14,516) | 0 | |
Gain on the deconsolidation of Shredding | [1] | 0 | 6,619 |
Income tax benefit (expense) on (loss) gain | 3,504 | (2,751) | |
Net (loss) income from discontinued operations | $ (6,017) | $ 4,203 | |
[1] | Results for the three months ended August 31, 2014 related to the gain on the deconsolidation of Shredding were previously presented in continuing operations and were reclassified to discontinued operations as previously discussed. |
Supplemental Guarantor Inform53
Supplemental Guarantor Information - Narrative (Details) $ in Millions | Aug. 31, 2015USD ($) |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Senior notes | $ 1,300 |
Supplemental Guarantor Inform54
Supplemental Guarantor Information - Condensed Consolidating Income Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
Revenue: | ||
Uniform rental and facility services | $ 938,408 | $ 873,698 |
Other | 260,482 | 228,379 |
Equity in net income of affiliates | 0 | 0 |
Total revenue | 1,198,890 | 1,102,077 |
Costs and expenses (income): | ||
Cost of uniform rental and facility services | 518,503 | 490,675 |
Cost of other | 156,243 | 133,456 |
Selling and administrative expenses | 338,637 | 314,458 |
Operating income | 185,507 | 163,488 |
Gain on sale of stock of an equity method investment | 0 | 21,739 |
Interest income | (119) | (53) |
Interest expense (income) | 16,412 | 16,583 |
Income before income taxes | 169,214 | 168,697 |
Income taxes | 63,016 | 62,792 |
Income from continuing operations | 106,198 | 105,905 |
Loss from discontinued operations, net of tax | (6,017) | 4,203 |
Net income | 100,181 | 110,108 |
Cintas Corporation | ||
Revenue: | ||
Uniform rental and facility services | 0 | 0 |
Other | 0 | 0 |
Equity in net income of affiliates | 106,198 | 105,905 |
Total revenue | 106,198 | 105,905 |
Costs and expenses (income): | ||
Cost of uniform rental and facility services | 0 | 0 |
Cost of other | 0 | 0 |
Selling and administrative expenses | 0 | 0 |
Operating income | 106,198 | 105,905 |
Gain on sale of stock of an equity method investment | 0 | |
Interest income | 0 | 0 |
Interest expense (income) | 0 | 0 |
Income before income taxes | 106,198 | 105,905 |
Income taxes | 0 | 0 |
Income from continuing operations | 106,198 | 105,905 |
Loss from discontinued operations, net of tax | (6,017) | 4,203 |
Net income | 100,181 | 110,108 |
Corp. 2 | ||
Revenue: | ||
Uniform rental and facility services | 721,329 | 665,874 |
Other | 372,611 | 336,480 |
Equity in net income of affiliates | 0 | 0 |
Total revenue | 1,093,940 | 1,002,354 |
Costs and expenses (income): | ||
Cost of uniform rental and facility services | 440,580 | 408,371 |
Cost of other | 237,369 | 217,942 |
Selling and administrative expenses | 347,076 | 314,002 |
Operating income | 68,915 | 62,039 |
Gain on sale of stock of an equity method investment | 0 | |
Interest income | 0 | (5) |
Interest expense (income) | 16,375 | 16,409 |
Income before income taxes | 52,540 | 45,635 |
Income taxes | 19,589 | 16,748 |
Income from continuing operations | 32,951 | 28,887 |
Loss from discontinued operations, net of tax | (5,323) | 4,263 |
Net income | 27,628 | 33,150 |
Subsidiary Guarantors | ||
Revenue: | ||
Uniform rental and facility services | 202,265 | 183,181 |
Other | 1,293 | 481 |
Equity in net income of affiliates | 0 | 0 |
Total revenue | 203,558 | 183,662 |
Costs and expenses (income): | ||
Cost of uniform rental and facility services | 116,832 | 110,922 |
Cost of other | (8,643) | (10,657) |
Selling and administrative expenses | (18,855) | (14,006) |
Operating income | 114,224 | 97,403 |
Gain on sale of stock of an equity method investment | 21,739 | |
Interest income | (48) | (48) |
Interest expense (income) | 38 | 170 |
Income before income taxes | 114,234 | 119,020 |
Income taxes | 42,591 | 44,004 |
Income from continuing operations | 71,643 | 75,016 |
Loss from discontinued operations, net of tax | 0 | 0 |
Net income | 71,643 | 75,016 |
Non- Guarantors | ||
Revenue: | ||
Uniform rental and facility services | 54,012 | 59,861 |
Other | 14,811 | 13,744 |
Equity in net income of affiliates | 0 | 0 |
Total revenue | 68,823 | 73,605 |
Costs and expenses (income): | ||
Cost of uniform rental and facility services | 37,357 | 40,282 |
Cost of other | 9,570 | 8,957 |
Selling and administrative expenses | 17,880 | 19,074 |
Operating income | 4,016 | 5,292 |
Gain on sale of stock of an equity method investment | 0 | |
Interest income | (71) | 0 |
Interest expense (income) | (1) | 4 |
Income before income taxes | 4,088 | 5,288 |
Income taxes | 861 | 2,051 |
Income from continuing operations | 3,227 | 3,237 |
Loss from discontinued operations, net of tax | (694) | (60) |
Net income | 2,533 | 3,177 |
Eliminations | ||
Revenue: | ||
Uniform rental and facility services | (39,198) | (35,218) |
Other | (128,233) | (122,326) |
Equity in net income of affiliates | (106,198) | (105,905) |
Total revenue | (273,629) | (263,449) |
Costs and expenses (income): | ||
Cost of uniform rental and facility services | (76,266) | (68,900) |
Cost of other | (82,053) | (82,786) |
Selling and administrative expenses | (7,464) | (4,612) |
Operating income | (107,846) | (107,151) |
Gain on sale of stock of an equity method investment | 0 | |
Interest income | 0 | 0 |
Interest expense (income) | 0 | 0 |
Income before income taxes | (107,846) | (107,151) |
Income taxes | (25) | (11) |
Income from continuing operations | (107,821) | (107,140) |
Loss from discontinued operations, net of tax | 6,017 | (4,203) |
Net income | $ (101,804) | $ (111,343) |
Supplemental Guarantor Inform55
Supplemental Guarantor Information - Condensed Consolidating Statements of Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 31, 2015 | Aug. 31, 2014 | |
Condensed Consolidating Financial Statements | ||
Net income | $ 100,181 | $ 110,108 |
Other comprehensive (loss) income, net of tax: | ||
Foreign currency translation adjustments | (12,013) | (2,115) |
Change in fair value of derivatives | 0 | 17 |
Amortization of interest rate lock agreements | 488 | 488 |
Change in fair value of available-for-sale securities | (8) | 0 |
Other comprehensive loss | (11,533) | (1,610) |
Comprehensive income | 88,648 | 108,498 |
Cintas Corporation | ||
Condensed Consolidating Financial Statements | ||
Net income | 100,181 | 110,108 |
Other comprehensive (loss) income, net of tax: | ||
Foreign currency translation adjustments | 0 | 0 |
Change in fair value of derivatives | 0 | |
Amortization of interest rate lock agreements | 0 | 0 |
Change in fair value of available-for-sale securities | 0 | |
Other comprehensive loss | 0 | 0 |
Comprehensive income | 100,181 | 110,108 |
Corp. 2 | ||
Condensed Consolidating Financial Statements | ||
Net income | 27,628 | 33,150 |
Other comprehensive (loss) income, net of tax: | ||
Foreign currency translation adjustments | 0 | 0 |
Change in fair value of derivatives | 0 | |
Amortization of interest rate lock agreements | 488 | 488 |
Change in fair value of available-for-sale securities | 0 | |
Other comprehensive loss | 488 | 488 |
Comprehensive income | 28,116 | 33,638 |
Subsidiary Guarantors | ||
Condensed Consolidating Financial Statements | ||
Net income | 71,643 | 75,016 |
Other comprehensive (loss) income, net of tax: | ||
Foreign currency translation adjustments | 0 | 0 |
Change in fair value of derivatives | 0 | |
Amortization of interest rate lock agreements | 0 | 0 |
Change in fair value of available-for-sale securities | 0 | |
Other comprehensive loss | 0 | 0 |
Comprehensive income | 71,643 | 75,016 |
Non- Guarantors | ||
Condensed Consolidating Financial Statements | ||
Net income | 2,533 | 3,177 |
Other comprehensive (loss) income, net of tax: | ||
Foreign currency translation adjustments | (12,013) | (2,115) |
Change in fair value of derivatives | 17 | |
Amortization of interest rate lock agreements | 0 | 0 |
Change in fair value of available-for-sale securities | (8) | |
Other comprehensive loss | (12,021) | (2,098) |
Comprehensive income | (9,488) | 1,079 |
Eliminations | ||
Condensed Consolidating Financial Statements | ||
Net income | (101,804) | (111,343) |
Other comprehensive (loss) income, net of tax: | ||
Foreign currency translation adjustments | 0 | 0 |
Change in fair value of derivatives | 0 | |
Amortization of interest rate lock agreements | 0 | 0 |
Change in fair value of available-for-sale securities | 0 | |
Other comprehensive loss | 0 | 0 |
Comprehensive income | $ (101,804) | $ (111,343) |
Supplemental Guarantor Inform56
Supplemental Guarantor Information - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands | Aug. 31, 2015 | May. 31, 2015 | Aug. 31, 2014 | May. 31, 2014 |
Current assets: | ||||
Cash and cash equivalents | $ 146,860 | $ 417,073 | $ 581,453 | $ 513,288 |
Marketable securities | 53,354 | 16,081 | ||
Accounts receivable, net | 531,127 | 496,130 | ||
Inventories, net | 240,046 | 226,211 | ||
Uniforms and other rental items in service | 537,120 | 534,005 | ||
Income taxes, current | 0 | 936 | ||
Assets held for sale | 194,275 | 21,341 | ||
Prepaid expenses and other current assets | 31,170 | 24,030 | ||
Total current assets | 1,733,952 | 1,735,807 | ||
Property and equipment, at cost, net | 896,786 | 871,421 | ||
Investments | 123,494 | 329,692 | ||
Goodwill | 1,272,503 | 1,195,612 | ||
Service contracts, net | 75,306 | 42,434 | ||
Other assets, net | 20,908 | 17,494 | ||
Total assets | 4,122,949 | 4,192,460 | 4,556,270 | |
Current liabilities: | ||||
Accounts payable | 131,956 | 109,607 | ||
Accrued compensation and related liabilities | 53,018 | 88,423 | ||
Accrued liabilities | 294,845 | 309,935 | ||
Income taxes, current | 47,640 | 0 | ||
Deferred tax (asset) liability | 103,410 | 112,389 | ||
Deferred tax liability associated with the investment in Shred-it | 78,457 | 704 | ||
Long-term debt due within one year | 250,000 | 0 | ||
Total current liabilities | 959,326 | 621,058 | ||
Long-term liabilities: | ||||
Long-term debt due after one year | 1,050,000 | 1,300,000 | ||
Deferred income taxes | 148,793 | 226,938 | ||
Accrued liabilities | 116,161 | 112,009 | ||
Total long-term liabilities | 1,314,954 | 1,638,947 | ||
Total shareholders’ equity | 1,848,669 | 1,932,455 | ||
Total liabilities and shareholders' equity | 4,122,949 | 4,192,460 | ||
Cintas Corporation | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Marketable securities | 0 | 0 | ||
Accounts receivable, net | 0 | 0 | ||
Inventories, net | 0 | 0 | ||
Uniforms and other rental items in service | 0 | 0 | ||
Income taxes, current | 0 | |||
Assets held for sale | 0 | 0 | ||
Prepaid expenses and other current assets | 0 | 0 | ||
Total current assets | 0 | 0 | ||
Property and equipment, at cost, net | 0 | 0 | ||
Investments | 321,083 | 321,083 | ||
Goodwill | 0 | 0 | ||
Service contracts, net | 0 | 0 | ||
Other assets, net | 1,082,343 | 1,154,596 | ||
Total assets | 1,403,426 | 1,475,679 | ||
Current liabilities: | ||||
Accounts payable | (465,247) | (465,247) | ||
Accrued compensation and related liabilities | 0 | 0 | ||
Accrued liabilities | 0 | 0 | ||
Income taxes, current | 0 | |||
Deferred tax (asset) liability | 0 | 0 | ||
Deferred tax liability associated with the investment in Shred-it | 0 | 0 | ||
Long-term debt due within one year | 0 | 0 | ||
Total current liabilities | (465,247) | (465,247) | ||
Long-term liabilities: | ||||
Long-term debt due after one year | 0 | 0 | ||
Deferred income taxes | 0 | 0 | ||
Accrued liabilities | 0 | 0 | ||
Total long-term liabilities | 0 | 0 | ||
Total shareholders’ equity | 1,868,673 | 1,940,926 | ||
Total liabilities and shareholders' equity | 1,403,426 | 1,475,679 | ||
Corp. 2 | ||||
Current assets: | ||||
Cash and cash equivalents | 74,082 | 74,145 | 75,744 | 73,540 |
Marketable securities | 0 | 0 | ||
Accounts receivable, net | 392,911 | 358,560 | ||
Inventories, net | 207,755 | 193,594 | ||
Uniforms and other rental items in service | 402,093 | 399,017 | ||
Income taxes, current | 1,191 | |||
Assets held for sale | 171,106 | 21,341 | ||
Prepaid expenses and other current assets | 6,626 | 5,514 | ||
Total current assets | 1,254,573 | 1,053,362 | ||
Property and equipment, at cost, net | 533,178 | 523,690 | ||
Investments | 1,769,572 | 1,956,320 | ||
Goodwill | 0 | 0 | ||
Service contracts, net | 73,308 | 42,400 | ||
Other assets, net | 17,145 | 12,373 | ||
Total assets | 3,647,776 | 3,588,145 | ||
Current liabilities: | ||||
Accounts payable | (900,579) | (877,042) | ||
Accrued compensation and related liabilities | 34,861 | 59,752 | ||
Accrued liabilities | 78,561 | 65,022 | ||
Income taxes, current | 7,042 | |||
Deferred tax (asset) liability | (421) | (299) | ||
Deferred tax liability associated with the investment in Shred-it | 69,100 | 704 | ||
Long-term debt due within one year | 250,317 | 293 | ||
Total current liabilities | (461,119) | (751,570) | ||
Long-term liabilities: | ||||
Long-term debt due after one year | 1,058,135 | 1,308,452 | ||
Deferred income taxes | (69,104) | (5) | ||
Accrued liabilities | 0 | 0 | ||
Total long-term liabilities | 989,031 | 1,308,447 | ||
Total shareholders’ equity | 3,119,864 | 3,031,268 | ||
Total liabilities and shareholders' equity | 3,647,776 | 3,588,145 | ||
Subsidiary Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 45,339 | 249,203 | 466,645 | 399,525 |
Marketable securities | 0 | 0 | ||
Accounts receivable, net | 106,001 | 104,964 | ||
Inventories, net | 22,280 | 21,149 | ||
Uniforms and other rental items in service | 118,059 | 117,473 | ||
Income taxes, current | (339) | |||
Assets held for sale | 0 | 0 | ||
Prepaid expenses and other current assets | 23,490 | 17,492 | ||
Total current assets | 315,169 | 509,942 | ||
Property and equipment, at cost, net | 292,341 | 275,072 | ||
Investments | 900,288 | 895,393 | ||
Goodwill | 1,239,155 | 1,180,527 | ||
Service contracts, net | 26 | 34 | ||
Other assets, net | 2,961,709 | 2,741,950 | ||
Total assets | 5,708,688 | 5,602,918 | ||
Current liabilities: | ||||
Accounts payable | 1,435,850 | 1,391,999 | ||
Accrued compensation and related liabilities | 14,730 | 23,989 | ||
Accrued liabilities | 205,269 | 232,500 | ||
Income taxes, current | 40,759 | |||
Deferred tax (asset) liability | 96,143 | 104,663 | ||
Deferred tax liability associated with the investment in Shred-it | 0 | 0 | ||
Long-term debt due within one year | (317) | (293) | ||
Total current liabilities | 1,792,434 | 1,752,858 | ||
Long-term liabilities: | ||||
Long-term debt due after one year | (8,725) | (9,766) | ||
Deferred income taxes | 229,712 | 229,266 | ||
Accrued liabilities | 115,362 | 111,105 | ||
Total long-term liabilities | 336,349 | 330,605 | ||
Total shareholders’ equity | 3,579,905 | 3,519,455 | ||
Total liabilities and shareholders' equity | 5,708,688 | 5,602,918 | ||
Non- Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 27,439 | 93,725 | 39,064 | 40,223 |
Marketable securities | 53,354 | 16,081 | ||
Accounts receivable, net | 32,215 | 32,606 | ||
Inventories, net | 9,624 | 8,870 | ||
Uniforms and other rental items in service | 35,354 | 36,478 | ||
Income taxes, current | 84 | |||
Assets held for sale | 23,169 | 0 | ||
Prepaid expenses and other current assets | 1,054 | 1,024 | ||
Total current assets | 182,209 | 188,868 | ||
Property and equipment, at cost, net | 71,267 | 72,659 | ||
Investments | 936,126 | 956,461 | ||
Goodwill | 33,460 | 15,197 | ||
Service contracts, net | 1,972 | 0 | ||
Other assets, net | 3,467 | 3,572 | ||
Total assets | 1,228,501 | 1,236,757 | ||
Current liabilities: | ||||
Accounts payable | 23,927 | 21,876 | ||
Accrued compensation and related liabilities | 3,427 | 4,682 | ||
Accrued liabilities | 11,015 | 13,137 | ||
Income taxes, current | (161) | |||
Deferred tax (asset) liability | 7,688 | 8,025 | ||
Deferred tax liability associated with the investment in Shred-it | 9,357 | 0 | ||
Long-term debt due within one year | 0 | 0 | ||
Total current liabilities | 55,253 | 47,720 | ||
Long-term liabilities: | ||||
Long-term debt due after one year | 590 | 590 | ||
Deferred income taxes | (11,815) | (2,323) | ||
Accrued liabilities | 799 | 904 | ||
Total long-term liabilities | (10,426) | (829) | ||
Total shareholders’ equity | 1,183,674 | 1,189,866 | ||
Total liabilities and shareholders' equity | 1,228,501 | 1,236,757 | ||
Eliminations | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | $ 0 | $ 0 |
Marketable securities | 0 | 0 | ||
Accounts receivable, net | 0 | 0 | ||
Inventories, net | 387 | 2,598 | ||
Uniforms and other rental items in service | (18,386) | (18,963) | ||
Income taxes, current | 0 | |||
Assets held for sale | 0 | 0 | ||
Prepaid expenses and other current assets | 0 | 0 | ||
Total current assets | (17,999) | (16,365) | ||
Property and equipment, at cost, net | 0 | 0 | ||
Investments | (3,803,575) | (3,799,565) | ||
Goodwill | (112) | (112) | ||
Service contracts, net | 0 | 0 | ||
Other assets, net | (4,043,756) | (3,894,997) | ||
Total assets | (7,865,442) | (7,711,039) | ||
Current liabilities: | ||||
Accounts payable | 38,005 | 38,021 | ||
Accrued compensation and related liabilities | 0 | 0 | ||
Accrued liabilities | 0 | (724) | ||
Income taxes, current | 0 | |||
Deferred tax (asset) liability | 0 | 0 | ||
Deferred tax liability associated with the investment in Shred-it | 0 | 0 | ||
Long-term debt due within one year | 0 | 0 | ||
Total current liabilities | 38,005 | 37,297 | ||
Long-term liabilities: | ||||
Long-term debt due after one year | 0 | 724 | ||
Deferred income taxes | 0 | 0 | ||
Accrued liabilities | 0 | 0 | ||
Total long-term liabilities | 0 | 724 | ||
Total shareholders’ equity | (7,903,447) | (7,749,060) | ||
Total liabilities and shareholders' equity | $ (7,865,442) | $ (7,711,039) |
Supplemental Guarantor Inform57
Supplemental Guarantor Information - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands | Jun. 30, 2014 | Aug. 31, 2015 | Aug. 31, 2014 |
Cash flows from operating activities: | |||
Net income | $ 100,181 | $ 110,108 | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities | |||
Depreciation | 36,165 | 35,448 | |
Amortization of intangible assets | 3,603 | 4,206 | |
Stock-based compensation | 23,917 | 12,280 | |
Gain on sale of Storage Assets | (4,843) | 0 | |
Loss on investment in Shred-it Partnership | 14,516 | 0 | |
Gain on deconsolidation of Shredding | 0 | (6,619) | |
Gain on sale of stock of an equity method investment | 0 | (21,739) | |
Deferred income taxes | 5,632 | 2,108 | |
Change in current assets and liabilities, net of acquisitions of businesses: | |||
Accounts receivable, net | (19,255) | 8,222 | |
Inventories, net | (8,109) | 1,377 | |
Uniforms and other rental items in service | (4,939) | (7,112) | |
Prepaid expenses and other current assets | (6,024) | (5,884) | |
Accounts payable | 15,531 | (1,325) | |
Accrued compensation and related liabilities | (35,579) | (41,262) | |
Accrued liabilities and other | (26,253) | 10,384 | |
Income taxes, current | 48,540 | 48,009 | |
Net cash provided by operating activities | 143,083 | 148,201 | |
Cash flows from investing activities: | |||
Capital expenditures | (62,631) | (68,050) | |
Proceeds from redemption of marketable securities | 152,907 | 0 | |
Purchase of marketable securities and investments | (196,020) | (6,981) | |
Proceeds from sale of Storage Assets | 24,395 | 0 | |
Proceeds from Shredding Transaction, net of cash contributed | 0 | 3,344 | |
Proceeds from sale of stock of an equity method investment | 0 | 29,933 | |
Dividends received on equity method investment | $ 5,200 | 0 | 5,247 |
Acquisitions of businesses, net of cash acquired | (121,434) | (2,328) | |
Other, net | 921 | 16 | |
Net cash used in investing activities | (201,862) | (38,819) | |
Cash flows from financing activities: | |||
Proceeds from issuance of debt | 0 | ||
Repayment of debt | (16) | (180) | |
Exercise of stock-based compensation awards | 11,844 | 13,623 | |
Repurchase of common stock | (221,598) | (61,439) | |
Other, net | 51 | 6,798 | |
Net cash used in financing activities | (209,719) | (41,198) | |
Effect of exchange rate changes on cash and cash equivalents | (1,715) | (19) | |
Net (decrease) increase in cash and cash equivalents | (270,213) | 68,165 | |
Cash and cash equivalents at beginning of period | 417,073 | 513,288 | |
Cash and cash equivalents at end of period | 146,860 | 581,453 | |
Cintas Corporation | |||
Cash flows from operating activities: | |||
Net income | 100,181 | 110,108 | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities | |||
Depreciation | 0 | 0 | |
Amortization of intangible assets | 0 | 0 | |
Stock-based compensation | 23,917 | 12,280 | |
Gain on sale of Storage Assets | 0 | ||
Loss on investment in Shred-it Partnership | 0 | ||
Gain on deconsolidation of Shredding | 0 | ||
Gain on sale of stock of an equity method investment | 0 | ||
Deferred income taxes | 0 | 0 | |
Change in current assets and liabilities, net of acquisitions of businesses: | |||
Accounts receivable, net | 0 | 0 | |
Inventories, net | 0 | 0 | |
Uniforms and other rental items in service | 0 | 0 | |
Prepaid expenses and other current assets | 0 | 0 | |
Accounts payable | 0 | 0 | |
Accrued compensation and related liabilities | 0 | 0 | |
Accrued liabilities and other | 0 | 0 | |
Income taxes, current | 0 | 0 | |
Net cash provided by operating activities | 124,098 | 122,388 | |
Cash flows from investing activities: | |||
Capital expenditures | 0 | 0 | |
Proceeds from redemption of marketable securities | 0 | ||
Purchase of marketable securities and investments | 0 | 0 | |
Proceeds from sale of Storage Assets | 0 | ||
Proceeds from Shredding Transaction, net of cash contributed | 0 | ||
Proceeds from sale of stock of an equity method investment | 0 | ||
Dividends received on equity method investment | 0 | ||
Acquisitions of businesses, net of cash acquired | 0 | 0 | |
Other, net | 85,656 | (80,725) | |
Net cash used in investing activities | 85,656 | (80,725) | |
Cash flows from financing activities: | |||
Proceeds from issuance of debt | 0 | ||
Repayment of debt | 0 | 0 | |
Exercise of stock-based compensation awards | 11,844 | 13,623 | |
Repurchase of common stock | (221,598) | (61,439) | |
Other, net | 0 | 6,153 | |
Net cash used in financing activities | (209,754) | (41,663) | |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 | |
Net (decrease) increase in cash and cash equivalents | 0 | 0 | |
Cash and cash equivalents at beginning of period | 0 | 0 | |
Cash and cash equivalents at end of period | 0 | 0 | |
Corp. 2 | |||
Cash flows from operating activities: | |||
Net income | 27,628 | 33,150 | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities | |||
Depreciation | 21,427 | 19,547 | |
Amortization of intangible assets | 3,513 | 3,773 | |
Stock-based compensation | 0 | 0 | |
Gain on sale of Storage Assets | (4,843) | ||
Loss on investment in Shred-it Partnership | 13,427 | ||
Gain on deconsolidation of Shredding | (6,619) | ||
Gain on sale of stock of an equity method investment | 0 | ||
Deferred income taxes | 21 | 0 | |
Change in current assets and liabilities, net of acquisitions of businesses: | |||
Accounts receivable, net | (19,744) | 10,014 | |
Inventories, net | (8,856) | (1,045) | |
Uniforms and other rental items in service | (3,076) | (4,450) | |
Prepaid expenses and other current assets | (100) | 200 | |
Accounts payable | 28,715 | (70,520) | |
Accrued compensation and related liabilities | (24,891) | (28,267) | |
Accrued liabilities and other | (1,775) | (31,741) | |
Income taxes, current | 8,231 | 6,913 | |
Net cash provided by operating activities | 39,677 | (69,045) | |
Cash flows from investing activities: | |||
Capital expenditures | (29,695) | (22,686) | |
Proceeds from redemption of marketable securities | 0 | ||
Purchase of marketable securities and investments | 2,215 | (1,721) | |
Proceeds from sale of Storage Assets | 24,395 | ||
Proceeds from Shredding Transaction, net of cash contributed | 3,344 | ||
Proceeds from sale of stock of an equity method investment | 0 | ||
Dividends received on equity method investment | 0 | ||
Acquisitions of businesses, net of cash acquired | (96,353) | (2,328) | |
Other, net | 59,519 | 94,602 | |
Net cash used in investing activities | (39,919) | 71,211 | |
Cash flows from financing activities: | |||
Proceeds from issuance of debt | 0 | ||
Repayment of debt | (309) | (450) | |
Exercise of stock-based compensation awards | 0 | 0 | |
Repurchase of common stock | 0 | 0 | |
Other, net | 488 | 488 | |
Net cash used in financing activities | 179 | 38 | |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 | |
Net (decrease) increase in cash and cash equivalents | (63) | 2,204 | |
Cash and cash equivalents at beginning of period | 74,145 | 73,540 | |
Cash and cash equivalents at end of period | 74,082 | 75,744 | |
Subsidiary Guarantors | |||
Cash flows from operating activities: | |||
Net income | 71,643 | 75,016 | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities | |||
Depreciation | 12,340 | 13,037 | |
Amortization of intangible assets | 40 | 15 | |
Stock-based compensation | 0 | 0 | |
Gain on sale of Storage Assets | 0 | ||
Loss on investment in Shred-it Partnership | 0 | ||
Gain on deconsolidation of Shredding | 0 | ||
Gain on sale of stock of an equity method investment | (21,739) | ||
Deferred income taxes | 5,784 | 2,083 | |
Change in current assets and liabilities, net of acquisitions of businesses: | |||
Accounts receivable, net | (1,038) | (3,852) | |
Inventories, net | (1,130) | 2,430 | |
Uniforms and other rental items in service | (586) | (1,673) | |
Prepaid expenses and other current assets | (5,998) | (6,288) | |
Accounts payable | (14,970) | 71,606 | |
Accrued compensation and related liabilities | (9,258) | (10,204) | |
Accrued liabilities and other | (22,975) | 42,084 | |
Income taxes, current | 40,411 | 40,601 | |
Net cash provided by operating activities | 74,263 | 203,116 | |
Cash flows from investing activities: | |||
Capital expenditures | (29,617) | (42,239) | |
Proceeds from redemption of marketable securities | 0 | ||
Purchase of marketable securities and investments | (10,148) | (15,260) | |
Proceeds from sale of Storage Assets | 0 | ||
Proceeds from Shredding Transaction, net of cash contributed | 0 | ||
Proceeds from sale of stock of an equity method investment | 29,933 | ||
Dividends received on equity method investment | 5,247 | ||
Acquisitions of businesses, net of cash acquired | 0 | 0 | |
Other, net | (239,160) | (114,793) | |
Net cash used in investing activities | (278,925) | (137,112) | |
Cash flows from financing activities: | |||
Proceeds from issuance of debt | (55) | ||
Repayment of debt | 853 | 1,116 | |
Exercise of stock-based compensation awards | 0 | 0 | |
Repurchase of common stock | 0 | 0 | |
Other, net | 0 | 0 | |
Net cash used in financing activities | 798 | 1,116 | |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 | |
Net (decrease) increase in cash and cash equivalents | (203,864) | 67,120 | |
Cash and cash equivalents at beginning of period | 249,203 | 399,525 | |
Cash and cash equivalents at end of period | 45,339 | 466,645 | |
Non- Guarantors | |||
Cash flows from operating activities: | |||
Net income | 2,533 | 3,177 | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities | |||
Depreciation | 2,398 | 2,864 | |
Amortization of intangible assets | 50 | 418 | |
Stock-based compensation | 0 | 0 | |
Gain on sale of Storage Assets | 0 | ||
Loss on investment in Shred-it Partnership | 1,089 | ||
Gain on deconsolidation of Shredding | 0 | ||
Gain on sale of stock of an equity method investment | 0 | ||
Deferred income taxes | (173) | 25 | |
Change in current assets and liabilities, net of acquisitions of businesses: | |||
Accounts receivable, net | 1,527 | 2,060 | |
Inventories, net | (334) | (1,174) | |
Uniforms and other rental items in service | (700) | (1,053) | |
Prepaid expenses and other current assets | 74 | 204 | |
Accounts payable | 1,802 | (2,415) | |
Accrued compensation and related liabilities | (1,430) | (2,791) | |
Accrued liabilities and other | (2,227) | (705) | |
Income taxes, current | (102) | 495 | |
Net cash provided by operating activities | 4,507 | 1,105 | |
Cash flows from investing activities: | |||
Capital expenditures | (3,319) | (3,125) | |
Proceeds from redemption of marketable securities | 152,907 | ||
Purchase of marketable securities and investments | (192,097) | 0 | |
Proceeds from sale of Storage Assets | 0 | ||
Proceeds from Shredding Transaction, net of cash contributed | 0 | ||
Proceeds from sale of stock of an equity method investment | 0 | ||
Dividends received on equity method investment | 0 | ||
Acquisitions of businesses, net of cash acquired | (25,081) | 0 | |
Other, net | (1,270) | 823 | |
Net cash used in investing activities | (68,860) | (2,302) | |
Cash flows from financing activities: | |||
Proceeds from issuance of debt | 55 | ||
Repayment of debt | 164 | (100) | |
Exercise of stock-based compensation awards | 0 | 0 | |
Repurchase of common stock | 0 | 0 | |
Other, net | (437) | 157 | |
Net cash used in financing activities | (218) | 57 | |
Effect of exchange rate changes on cash and cash equivalents | (1,715) | (19) | |
Net (decrease) increase in cash and cash equivalents | (66,286) | (1,159) | |
Cash and cash equivalents at beginning of period | 93,725 | 40,223 | |
Cash and cash equivalents at end of period | 27,439 | 39,064 | |
Eliminations | |||
Cash flows from operating activities: | |||
Net income | (101,804) | (111,343) | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities | |||
Depreciation | 0 | 0 | |
Amortization of intangible assets | 0 | 0 | |
Stock-based compensation | 0 | 0 | |
Gain on sale of Storage Assets | 0 | ||
Loss on investment in Shred-it Partnership | 0 | ||
Gain on deconsolidation of Shredding | 0 | ||
Gain on sale of stock of an equity method investment | 0 | ||
Deferred income taxes | 0 | 0 | |
Change in current assets and liabilities, net of acquisitions of businesses: | |||
Accounts receivable, net | 0 | 0 | |
Inventories, net | 2,211 | 1,166 | |
Uniforms and other rental items in service | (577) | 64 | |
Prepaid expenses and other current assets | 0 | 0 | |
Accounts payable | (16) | 4 | |
Accrued compensation and related liabilities | 0 | 0 | |
Accrued liabilities and other | 724 | 746 | |
Income taxes, current | 0 | 0 | |
Net cash provided by operating activities | (99,462) | (109,363) | |
Cash flows from investing activities: | |||
Capital expenditures | 0 | 0 | |
Proceeds from redemption of marketable securities | 0 | ||
Purchase of marketable securities and investments | 4,010 | 10,000 | |
Proceeds from sale of Storage Assets | 0 | ||
Proceeds from Shredding Transaction, net of cash contributed | 0 | ||
Proceeds from sale of stock of an equity method investment | 0 | ||
Dividends received on equity method investment | 0 | ||
Acquisitions of businesses, net of cash acquired | 0 | 0 | |
Other, net | 96,176 | 100,109 | |
Net cash used in investing activities | 100,186 | 110,109 | |
Cash flows from financing activities: | |||
Proceeds from issuance of debt | 0 | ||
Repayment of debt | (724) | (746) | |
Exercise of stock-based compensation awards | 0 | 0 | |
Repurchase of common stock | 0 | 0 | |
Other, net | 0 | 0 | |
Net cash used in financing activities | (724) | (746) | |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 | |
Net (decrease) increase in cash and cash equivalents | 0 | 0 | |
Cash and cash equivalents at beginning of period | 0 | 0 | |
Cash and cash equivalents at end of period | $ 0 | $ 0 |
Subsequent Event (Details)
Subsequent Event (Details) - USD ($) | Oct. 01, 2015 | Aug. 31, 2015 | Aug. 31, 2014 |
Subsequent Event [Line Items] | |||
Proceeds from sale of equity method investment | $ 0 | $ 29,933,000 | |
Shred-it | Discontinued Operations | Subsequent Event | |||
Subsequent Event [Line Items] | |||
Proceeds from sale of equity method investment | $ 578,000,000 | ||
Estimated additional consideration subject to holdback provisions (up to) | $ 34,000,000 |