UNF - Earnings call transcript Q2 2018

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Second Quarter Earnings Conference Call.

During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this call is being recorded, Wednesday, March 28, 2018. to call like to now would turn over the Mr. I Executive UniFirst President Sintros, Officer. and Steve Chief Please go ahead, sir.

Steve Sintros

and Sintros, Chief UniFirst’s you President Thank good and Executive morning. Officer. I’m Steven

anticipate, forward-looking and I Financial believe, and Senior Joining intend expectations to current expressions disclaimer. all financial going my differ statements views discuss But Actual will for contain estimate, subject call trends conference complete our that that XX.X%. prior call company’s forward-looking similar current those President events were may me indicate was reported an fiscal variety discussion results Shane recent up review These statements. with on our the words diluted in Corporation’s a I like materially I’m shareholders. be O'Connor, future is to of our like are quarter risk depending forward. to statements forward-looking first, to second and share from compared earnings to may results listen-only quarter our optimistic, income today which high and quarter. welcome and earnings last UniFirst that up This performance. insight year’s is moments. UniFirst by our better per refer anticipated revenues mode Chief Shane few risks remarks. further a the to recent year on the risk our future solid XX-K second significantly all-time brief provide a quarter Officer. call factors. to you tax for the identify expect, ‘XX X.X% with and impacted I’d events that to A happy to reflect until Vice prepared for $XXX.X and future I’d a share the a certain results was respect million, conference and This The on the Fully U.S. second Exchange reform Overall will these the share report most for $X.XX a were to you per year in comparison to XX-Q factors Securities Company of were quarter from filings ago. our and Commission. per at quarter which operating note for produced uncertainties. $X.XX

segments All to our of quarter operating contributed results. second positively our

the record operations the Core Our compared improvements revenues prior quarter, $XXX also when showed year. quarter the reported last the from for to in Laundry up of Core million of year. Operating X.X% Laundry margins second

with nuclear weaker came work power project-based and we’re the results second segment, Specialty the is pleased due for expectations, particularly quarter. which First decontamination were specialized with products ahead what the often delivers nuclear Aid and our and positive quarter, quarter services, second also top unit’s Our cleanroom for of performance, with the Garments scheduling seasonal results internal to line which exceeded our strong in top-line customers. segment a Results producing our the expectations. Overall, for bottom of of

North across and to produce helped and work As our our financial continued to of Central hard America, thousands Europe for positive all Company for commitments the results our Partners first year. I that and of would like their thank Team for and such, the half quarter their sincerely America customers the

dedication course, industry. the And the be our unwavering by long-term expectations efforts are these people, of our we of be know objective their investments to in relying organization top growth be to on because we’ll our people requirements continue in in to continued exceeding to will infrastructure and recognized our be year-over-year organic the forward, continue our and ultimate service as universally sales we’ll our customers growth drive These challenging goals. their technology to help pursuit to achieving service Going to demonstrating sales their minimum our supported that provider improvement rates.

earnings, the common of repurchased and this as transaction a a at of to announced with million close common price our Class In Company morning $XXX in X.XXX addition shares also stock $XXX. of quarterly shares stock XX,XXX the private Croatti yesterday, business B that million of a for combined the Company the family of

to March to Corp., UniFirst with per fair of fuel The investments ability was Both products existing as B our in entire had this to and and infrastructure In its capacity options. be approved UniFirst $XXX addition, these was equivalents I in be for as credit, of price flows, a Ronald repurchase The Stifel who Cynthia D. from The Special the per line raising millions the price the and common to addresses evaluated share maintain former the the have opportunities decisions borrowing from of for UniFirst of to is assistance motivated Croatti Croatti $X.XXXX Class interest that earnings received any repurchase opportunity a business of as been transaction Board accretive combined our was as Committee affiliated the together willingness still Special that repurchase with were to per Special on the substantially involvement dividend, primary services. the in family of of make with Company, this other capital Chief for to be family of stock, Directors the to of of Directors under UniFirst’s advantage allocation a we capital, determined that, the continues XXXX, strategy. positive the provide stock Officer, planning of to shares to increase opinion evaluation market Special good leadership repurchase common ongoing to to family’s for has upon the Croatti members Croatti a were the When best Company as opportunity $X.XX discount our cash stock executed well-positioned the ongoing Croatti aligned point Executive that if family to share Board our Committee of from of cash well these was in of available pursued the the may our improvements evaluation transaction, independent was at we’ll passing at Company of from hand. liquidity, the up generate in announced earlier, forecasted and the our the of paid the After per view. for and including sale and Committee market ensuring therefore future help share shares Board other Company’s make deploy mentioned Directors. year. last Committee its on for by of with was and uncertainties transaction Croatti positions, people, us. continued Financial Croatti, Despite Company, shareholders sense take share, stock with shares of highly liquidity purchase completion of exception XX, a our created liquidity cash the recommendation from as levels. the including financial high-level focus dividend effect approved several they quarterly the Croatti respectively. the Stifel as share as estate investments acquisition $X.XXXX $X.XX family’s and from of to ongoing create cash family well that and reviewed technologies desire an short-term it undertook the financial following over part the business with and and per and our family to This by quarterly of selling an abstained. The the Based and reform and family benefit the this tax the is Company. of recent investments for discounted The

continue resources will current As investments, the allocation we manage additional outlook And of and options remainder sheet well how year. for the determine timing provide these balance best over move our around to I’ll to call capital evaluate the forward, our the to who quarterly other of position to to pass now, will Shane as available our as us. we results some details

Shane O'Connor

for and XX, Cuts or for set second to quarter operating Act, in $X.XX segments. record prior was million, the of that year top the quarter million from December the $XX.X quarter the line I’m quarter up of for from Thanks, quarter Steve. $XXX.X was per share on by same in was U.S. or year’s new the ago, significantly up Company’s our performance pleased Operating second solid income a $XX.X X.X% second This an revenues the each our quarter. diluted to year. impacted last report compared which same at $X.XX UniFirst a by reported The million was a in income million $XX per period $XX.X to share enacted contributed was Net Tax diluted XX.X%. XXXX net income XXXX. increase Jobs million

per which the XX.X% quarter tax would Net income remainder $XX.X talk our of have $X.X in or call quarter. the quarter outlook not benefit year. benefited the include been million second tax any impact excess The excluding second Excluding did net tax an income will impact about reform share, our moment, in from such of during the the the during Company’s more benefits year. a earnings I increase diluted the the for depth million recognized over the of reform, $X.XX last provided of of for or prior

they XXXX, of benefit this reporting directly share-based payment now or in Improvements tax which our the payment excess As Standards first quarter statement and with reminder, expense occur. Accounting fiscal guidance, associated adopted Share-Based employee revised the to deficiencies a Accounting. income benefits we in to Employee income in tax Under period XXXX-XX Update in are recognized

quarter the U.S our recently discussed, legislation. passed was by reform As significantly impacted second tax net income

paid With United generated tax our income a the of States, have high historically majority earnings we rate. within

These deemed new income first to resulted the the of will of net income income for our the its repatriation tax subject subject taxes. January X, reduction tax to lower tax re-measurement of XXXX, rates lower the the in the effect second tax re-measure the U.S. the quarter tax on a the year impact tax in onetime tax will income million be fiscal as $XX.X The With liabilities toll for fiscal of of be provision onetime rate. to U.S. toll of and require our deferred its Company Company for net earnings. deferred new rates Company the of half a earnings Also, foreign to liabilities, the the XXXX. reform, net

in of Core make effect revenue the Organic Canadian quarter. total growth, revenues operations reported fluctuations $XXX Our for approximately achieved the estimated the from up X%. X.X% adjusts year’s million, was up which quarter business, second as Laundry of dollar, the UniFirst��s of XX% last which revenues well during acquisitions as for

year in to lower a accounts, During favorable This of expense lost partially merchandise period positive account the by as operating as period. the benefit Core administrative compared a XX% quarter, sales quarter. to other a increased as charges. and ago. offset price to production-related quarter, a new as up healthcare prior drivers the lower solid payroll result the income continued primarily These Laundry costs improved well compared a as offset prior operating year. $XX.X positive the by moderately year’s expansion revenues income year year from were the million of second merchandise and were in higher higher of from other X.X% XX.X% percentage claims compensation percentage and collections as quarter, on to increase from margin for Core revenues, was These stock was prior compared we well for adjustments operating costs recovery to Laundry same the ago. margin comparisons

in and $XX increased second year income the decontamination slightly nuclear In delivers $X.X of to million XX.X%. to of $X.X Revenues of revenues operating million which and addition, in up This from XX% Garments energy quarter or services, prior X.X% were costs products X.X% million, reported our increased XXXX, fiscal year cleanroom segment’s a from from XXXX. the in Specialty up ago. second segment, quarter specialized

the and can past of timing nuclear second the in half seasonality as in to that vary the to Canadian as customers, our segment’s mentioned quarters, services. from Increased first we’ve and the as the the for as cleanroom well the due period, specialized require this outages year. and As drove from fiscal results from segment’s results period growth solid revenues projects reactor strong quarter the segment European well division of

strong balance period a Our and quarter at that the the investments the the The for $XX.X reported in as third totaled from to fiscal operating market. is business position. future made the end by continues of million of in Georgia financial $XX.X second and compared income First $XX.X of Atlanta, XXXX. United cash, fiscal by cash revenues million our strengthened UniFirst the of of the improvement acquisition million our aid same XXXX, maintain million XXXX. and short-term segment’s hand $XXX.X and well of the million At segment quarter sheet a our for $XXX.X top-line Of respectively and been fueled quarter on performance was solid the presence quarter-end, XXXX million up as $X equivalents to the for wholesale in distribution business $X.X accumulated million has end States. intended investments cash fiscal foreign subsidiaries outside and at

combined stock and equivalents the with a in shares $XXX in in discussed the under Croatti were earlier, repurchased over Steve shareholders. of maintained and common borrowing investments transaction private excess yesterday, cash, for well capacity of of X.XXX short-term family million common still After As million line a B stock $XXX transaction, XX,XXX the of Company’s shares Class $XXX cash credit. million and Company its the UniFirst million

ability transaction that way the believes necessary its making ability no impair its result, acquisitions. to its As business or this investments in will continue to strategic Company pursue a in limit

invest help updates including strategic new long-term will continue in us our We projects meet objectives, facility that expansions, and additions, systems. automation to capital

half fiscal and $XX.X we fiscal expect be expenditures For million. And million. $XXX capital of to capital the first million XXXX, for totaled the $XXX between expenditures full year now

acquisition plant industrial market. one Memphis, an Tennessee operation closed also of laundry we the quarter, the in During

outlook business sense historically like support UniFirst We’re the opportunities and excited provide revenue time, guidance and an integral part will the continue take half second XXXX. have approximately family fiscal about is us out this been between part that it in now that our to we opportunity revised bringing business additional closed the the revenue XXXX of provide and for million of acquisition make this in billion. into I’d this fiscal Business on our be from to to strategy an in quarter. objectives. $X.XX anticipated seek XXXX opportunities of revenues our and our expect At billion to us the during update $X.XX that country. This long-term includes growth additional that we’ll we $X the for acquisitions

Laundry the of business as assumes a impact our decrease stock-based year organic the of our Laundry the XXXX for Core revenues. Ron in anticipated year communicated the the X.X% million to operating half compared an well due this at project strong largely vesting our related business reform second in outlook $X related per In now passing to the well share within million accelerated our on impact also to margin growth earnings the anticipated revised and deceleration per $X.XX. This to estimated fiscal business Specialty increase as top-line revised of earnings year. midpoint. approximately outlook the addition, for share between includes former half Core segment’s impairment second to of per remainder related Garments of tax the second to our of from the of $X.XX the in previously is performance an in Full result XXXX half and year CRM includes share diluted expected of forecast The the our and the diluted earnings fiscal compensation which of of result The be share. $X.XX the XXXX second costs as guidance $XXX repurchase, of excluding quarter guidance the our prior Croatti, CEO, an is percentage and margin our of to in as its the increase is

of benefited As previously comparisons from half recovery discussed, year challenging. price XXXX, the of second collections this charges Company merchandise half of over positive adjustments and making with second the the more fiscal

low environment. addition, unemployment In by the impacted continued employee to be wages

of fiscal we payroll in invest in as energy of are a percentage to As also infrastructure, to we people second forecast year. headwind anticipate prices provide half Rising continue the and the revenues. our a costs higher

effective of for outlook Our an fiscal half assumes the of XXXX XX.X%. second tax rate

dependent However, of regarding remainder in over our this is certain balances this upon assumptions the fluctuations transitional year. rate tax deferred

As during blended be rate the federal our a occurring reminder, due tax our will fiscal change a fiscal to for XXXX, rate rate in year.

answer And We for expect questions that to to effective we be our happy rate tax and be range. XX% fiscal prepared our you thereafter now in remarks. have. may the XXXX XX% concludes that This any to would

Operator

Please [Operator Baird. Instructions] comes line And Andy from of our your of Wittmann with first proceed question question the

Andy Wittmann

I I morning. bit. thought into digging -- there’s here. little to parts a wanted good and Obviously Guys, guidance some with start moving I’d the Great start

that pull out implying around year is EPS guidance first a wrong, from guess revenue which Steve benefit EPS bought previously I you complicated But, bit estimate It results, So, it’s tax it of it the from wanted from compares like line bit me as I’m we and guidance consensus. guidance. little with want more below take, of you guidance dig second And to looks the EPS, $X.XX second When here, kind fairly than look reform, gave. what $X is I the at importantly little thoughts we like what your acquisition. the the your the the looks if half the first. at a then, maybe I $X.XX? unchanged, Shane, get it correct the about here. to your least I you into million is half in was wanted of to And half on EPS consensus and

there. factors guys You obviously highlighted some

factors over Sorry quarter? course same of some of the is the year. fair factors to you But, that little bit the last long got in are for it the the the that a factors question. worse those of earlier assume Some cited

Steve Sintros

That’s This Steve. okay, is understandable.

So, think your I your throughout assumptions correct. were question

at when revenue the think I look guidance of you remainder the year. the over

part, other the unchanged. nuclear Specialty Garments we segment than and acquisition the the highlighted, items the like largely For most are the in change

little business think side. more high-end, the on Laundry a favorable they’re bit I our Core at

you’re think at there. looking I So, it correctly

On the factors the headwind worse. are new previously. profit as it of what I the think tax had behind wouldn’t we rates year, side, On I after slightly second the for being correct. anticipated balance, characterize adjusting we you’re probably necessarily that also getting half

our repair that can than of in ran of of thing was other year, normal a they results costs, bit that lower little bit a areas, although quarter some they that prevalent our were a some aspect the one think better than number the be terms expenses. variable I and little in a was expenses this of production than our expectations. maintenance, prior of were Healthcare higher areas

of year. of that to potentially pushing remainder out we some see the the And

than of we anticipated you’re some a this results up bit So, some seeing may a I the back in things but what little to end quarter is half. think shift better that feel

mentioning In with I those wage the terms think year. so terms in of consistent from specific remain our on, levels the in earlier factors we’re cautions of and

Andy Wittmann

Okay.

helpful. that’s think I

I’ll think going you could on Phase kicking to you hoping where and update. have here? leave that. which are question give plan a X maybe on of on update to on and process move direction -- there a and off that guys new that more think you’re been when have a just direction I CRM my us some you I a was would next you around Obviously, question

Steve Sintros

Yes.

sort quarter get this into specifics of of ready to the not we’re that think outlook. I

we’re now. during the more a towards. along probably feeling headed from we’ve think, have we think quarter We to I will made I the good path. are path confident that quarter on say And progress

have As more relates well. ongoing there to commentary I investments, our as we’ll that think,

what but quarter say, of in terms direction positive I’d towards, and found a it’s what official So, no we’re we or right now. announcement working been

Andy Wittmann

coming overhead couple quarters scale-up right that the got through plan you you’ve kind still would that that It still of were a of anticipation the unusual in know be the in now bit little Are that P&L of another sounds carrying of a and of some last computers result that Is know here that business of maybe like embedded today? plan? as of running important nexus. people your that that kind processing that

Steve Sintros

Yes. I would say, yes.

I certainly had the in and the still this over years we of initiative. place had project anticipation grown off in team new kicking think remains

I as is will to trying there some move so, our there be and there think forward. communication part And figure is where balance overhang of we out the

Andy Wittmann

and future? are are for for Then, one too, that last the ongoing, B beneficial now least maybe I any B hopefully or to say, wrapped with foreseeable my shareholders is, further now this at on would question, buyback, negotiations the quite is like the to that holders deals on and there for it A up shareholders

Steve Sintros

family for latter; now one up the for now the wrapped The really, years some really future. have time almost But XX one-time in for for an this first to and this for is really was liquidity. thing is the This foreseeable the a opportunity future. foreseeable

Operator

Our Morgan. the next Please from Andrew from line Steinerman proceed. JP question comes of

Judah Sokel

of that half margins bit forward? a term second down. further so term a are a of hopping at if about Core going over of those Hi. talked last Do is Judah think back. or could some This least are you What going some Clearly, in I in little about that come bit a little headwind from where was few a How for the I down Laundry think the keep years seen sort be is longer years, few the you’ve we’re Thanks. margin were talk And X.X, for the business? And the you margins. you? just still you going you margins to yet? have margin on do they trajectory bottom to the at do little bit goal Andrew. at medium are more wondering

Steve Sintros

say and cycle, certainly back. hold hesitate working we start we’re are where the build they to where to I’d are probably exactly in But, to Judah. them

and some is I think wildcard the technology of these products one in some investments other of these we’re making things.

It start optimistic have margins moving continues and the acquisitions as few the them to move years. about of next some higher over apps in and there. really through about those still improving items, we improvements think underperforming and ability and our markets some those to be regions I we’re growth

So, I for like kind figure little the a where of trajectory some really not what of we’re ready line that’s punting next know the and until our year out investments of those say it question, to looks costs on get we bit but are. in

Judah Sokel

Understood.

of last far certainly As maybe the growth in Laundry, year-over-year embedded reasons just and inside seeing a top gives as the comps line your of with in half. market other organic -- the Core the how guidance you about back pricing Is first opposed guidance? that very as the caution talked revenue you’re half in of strong year that of some you’ve the mentioned is benefits, something a deceleration function you after for to much the that of that

Steve Sintros

slightly It’s look it at talked new retention very from standpoint. worse account being a sales about really slightly we this you actually those from or year positive. When performance items growth, our we in a higher mentioned. standpoint, been And lost it’s

to bit moved I wouldn’t of relates cause. there’s that somewhat that’s earlier the on strategically us anything no, the that But we year. of a in say, in Some giving little from market larger accounts

real is I think flags red market relatively healthy still and there. the environment no

Operator

Our from Tim of comes the Mulrooney Please next William question proceed. of line Blair.

Tim Mulrooney

margin? expect say year second Shane, the the X.X% Laundry, Good morning. you you you for for or the year -- just full did operating half on the Core Did of

Shane O'Connor

X.X% of at half second just the is the year. for margin operating That

Tim Mulrooney

be tailwind, And do of merchandise margin. inflation even as the to continue you second of higher impacting just half thing kind making enter a year, cost really expect to the that that’s you wage that Okay, it’s more items the other sure.

Shane O'Connor

Yes.

first our it put lot that into driven we along year acquisition. And by amortization acquisition. gotten XXXX, incurred of As we’ve Arrow started first of merchandise higher the a amortization merchandise and merchandise XXXX of benefit to effectively half normalize to higher the in our that the in our the we from relates that as garments compared costs within XXXX that to half manufactured was went as

might take we but half the second look benefit the we have we the slight not second to So, quarters. feel as away. in go the XXXX, going that get a that at in extent half benefit is of We a to effectively same last few that

Tim Mulrooney

But, decline be be so wouldn’t a speak./ a wouldn’t driving headwind, to or

Shane O'Connor

No.

Tim Mulrooney

Yes.

more last all Shane have for was What right. of sales percentage think, year Okay, it handy? then, as one you do X.X% and I a for last that energy And the this you. were quarter. costs year comparison,

Shane O'Connor

quarter? ‘XX, in it was of QX Last Last X.X%. quarter,

Tim Mulrooney

Yes.

So, have do this you for that quarter?

Shane O'Connor

Yes. QX, X.X%, up was it slightly…

Tim Mulrooney

X.X?

Shane O'Connor

Yes, up the XXXX. X.X quarter from of second in slightly

Tim Mulrooney

Got raise it it. moving And to maybe we mean, forward? about you I should policy do think one plan the now. dividend more, how Steve, annually

been as should in EPS about far line range, pre-specified with As there’s thoughts say, like here, a change we think it any the growing growth, there?

Steve Sintros

be at come context to acquisitions. performance, look cash may shares, saying, investments that going we buy the as forward. our it we all formal I think, to free say now along, performance flow to looking continue to part are you’re Right I’ll do back other be increase of -- not do that and not other have opportunities right we’ll in EPS yet. adopted like at of now, is we And something this a dividend policy it But, going our is it whether

something you said a makes sense the and policy forward. be many, years. taking formal more in looking context potentially whether it a I many at all So, looked a we’ll going in other of will move this it’s we look view really a think haven’t like Obviously, at options. be actively of our change. And in dividend But, as the should the investors made at,

Operator

from next of question Research. comes Please proceed Steinke Our Kevin line question. of Barrington the with your

Kevin Steinke

and how customers. reductions I on discussed could was Hi. just from by uniform economy. those your some give getting adds color this lift if I wondering you’re versus in be don’t may that believe you are you trending

Steve Sintros

seeing Kevin, really that. we’re Yes. not

are the talked the trending they versus a of were a didn’t sort little part really very adds they we year is, to the of way mention ago. adds of We Our really our all compared stable ago. just it similarly of run we reductions, when bit in reason really now. a bit about for negative. some year that’s things reductions a And stuff. it’s very right Typically, that are account are we but to counterintuitive, It’s and similar where internally a past, little little

not from big any pull big add our really seeing customer adds, we’re significant So, base. hiring within

side I the think the economy well. and the environment low some the on that as unemployment to that’s indicative of define seeing bit difficulty little a of and labor. our And competition we’re and as

So, there no adds big reductions. from real driver for

West we’re I market, where of thing pull little get is, narrower we see say bit in to as starting a But, little the strength before, energy. benefit to think, will there. bit was starting it Texas are market. one bit little as little of bit a some from Texas in in that area the seeing West I we so a not it’s a are broad Again, that

Kevin Steinke

helpful commentary. That’s Okay.

Specialty the increase. outlook, the On million $X Garments

the forecast the like outlook for year. your quarter of Sounds was of ahead but your to remainder the second also expectation revised is due

in second So, are you half than be the stronger previously? Specialty Garments were expecting to you

Steve Sintros

I think slightly.

I think second in benefit quarter. came most of the the actually

lot ticked quarter. and on balance to quarter was the benefit up the we be was strong in a little third bit. already of it a maybe second Our very projected But really

Kevin Steinke

be that the or type may the performance to acquisition it your markets pipeline as of stands pipeline specific And the Okay. in you’re is improve of this evaluating these Memphis just that and tuck-ins today? the regarding in certain is acquisition acquisition, flavor maybe overall mostly

Steve Sintros

regular larger we one like are But to smaller larger. Memphis like look an regional not or ones like the really bit ones won’t that this the That’s Memphis. in size little are the last players like of in size, it seems year, Arrow materializing. acquisitions, like at more Certainly, we say

And most and many, was it before, a these all talked these times about years we’ve family one over Memphis be executed. the talked we’ve was of example businesses. that as are to good are many almost of of -- able Although finally to

we like no, do ones So, these they’re continue go to we’ll and after.

Operator

also a question Andy W. We the of proceed. line Please have Robert of follow-up from Wittmann Baird.

Andy Wittmann

be just the things. over I that’s your that’s two on effectively here check the how thanks. last get the to happened sense thought, would consolidation Great, business of and in informative it year in just

providers you’ve to done changed some like hear that have could be might had, consolidation ability how if that’s well you new business, hands in off, amount in as today how any that attributed kind believe there think First one, and capture out their the of consolidation changing to the your to to of of market market I’d the business on as pricing that stands, those the that be happened. if that the are customers as to and maybe of be you open

Steve Sintros

continue benefit some get from to I we the consolidation. think

new from of to that Our much are compared consolidation How XX% is say. about is prior to sales difficult up the year. account

are customers think most wait-and-see taking I the approach. for a part

are competitors going to process is some being the it operations. for But the our some that able the integrating advantage about been I on customers we’ve and creating they’re uncertainty I diligent think of. take through think marketplace balance, in more

our to I think, we’re even taking ones, first acquisitions, patient And foremost. our are the make like and same. smaller when doing in I that approach and the we stabilize and do are integration customers care sure competitors of think

there, created out opportunities change some. dramatic a been it’s the think don’t in balance, has I it on but So

for terms think are In again, many environment, in options there customers. still the I most out our pricing competitors large markets and that of there

that foremost. significant and price think service our to think from we’re seeing of the dramatic And think could to able good consolidation, firm, nature there’s change. good it the do could. don’t we’re we time think by think yet. extent don’t anything pricing And drive customer pricing we’ll doing value But, I I on So, I be over balance I first comes customers. to -- I think been and a pricing the

Although consolidation, say as well. feel may unit be better pricing with that the because I just it of economy companies, side helps from about as their but customers the usually that would the somewhat also environment

Andy Wittmann

This industry from who’s very had not lot employee a my job of about And dirty the decades uniforms market economy, last has And guess to to changed helpful. wearing today has frankly want with. help over you your a think could might job as done with, what what noticed you the have think here customers question look -- offering I and dirty you you That’s do you you go you you here do you’ve slate enhance do your what just guess. more a what changed reins the your innovation hear bit a a and that economy little the that lot. a Steve, I base what at is overall chance as have potential look to you’re your I at to trying to Great. the rate? products and potentially growth with and your taken service customers and

Steve Sintros

have more lack from continues. just that customer said offerings but a from for base not exactly are and time, dirty, that of to our safety term, image dirt better a And like offerings and protection identity. think, I you migrated more over

getting slow is necessarily. image employees to they number comes flexibility their down details, some provide of of uniforms. are some there’s change we in And we’re style a that versus not of and to a areas, contracts currently, relatively the migration older it of a I lines because with the into more it customers, type get to that identity the But, maybe really out offering. lot we’re fabric, comfort are and there the rolling fit without of want think in more garments. product quick apparel comfort as a They in

kind the of and much more and golf sort that our from customers a businesses, already going more XX, the changes and ago, amount shirt was golf even businesses really shirt much, that years identity. a much -- traditional in lower industrial full-bore more a now work customers come more is shirt look of image to for that’s of of is XX common of of One kind

at give sure, look to try to advantage the it. roll and trends products us with continue marketplace get a keep out current and we can we the try where competitive us for so, And to that different

Operator

at this further Instructions] questions We time. not [Operator have

Steve Sintros

look to have us quarter for We be Okay, quarter our review great with to third thank today our for great. June a I’d forward like Thank expect in financial reporting results. you results. joining everyone our we again and when day. second of to you speaking

Operator

you Ladies disconnect your please ask call thank and for that concludes today. participation the and for We conference that gentlemen your lines.

UniFirst (UNF) 28 Mar 182018 Q2 Earnings call transcript