Cintas (CTAS) 18 Jul 242024 Q4 Earnings call transcript

Good day, everyone, and welcome to the Cintas Corporation announces fiscal 2024 fourth quarter and full year results. Today's call is being recorded. At this time, I would like to turn the meeting over to Mr. Jared Mattingley, Vice President and Treasurer, Investor Relations. Please go ahead, sir.

Ross. you, Thank joining for Thank us. you With me Officer; Officer. and Executive Schneider, Mike Todd Hansen, Financial President and Chief Executive Chief and is Vice President discuss year and fourth fiscal We'll full our 'XX results. quarter open the our Securities Reform forward-looking from of Act statements. we harbor After provides safe litigation call Litigation a commentary, XXXX civil questions from to analysts. Private will for financial This as to views the company's performance. conference current call contains forward-looking statements events reflect and that future results to forward-looking which actual These are could may we risks subject materially uncertainties, and differ discuss. statements to those from cause I contained refer Commission. filings Securities these you to the Exchange discussion with in on points and recent our most the I will now the turn to Todd. over call

Jared. you, Thank

businesses to quarter. These by quarter a were for the year a for exchange of X.X%. XX.X% an Earnings growth $X.XX, quarter points $XXX.X continue $X.XX was another $X.XX conclude XX.X% from of was Fourth to to fiscal in income fourth billion, margin basis rate over fourth for execute the XX.X% million, net XXX from adjusts significant increase Our strong year quarter of quarter. marked the XX.X% share strong prior of basis increase rate, high was the per increased each which $XXX.X XX.X%. X.X% prior increased high increase fourth marked successful capital Cintas. revenue for foreign over The the an of an to finish income all-time year results prior margin and an quarter prior diluted XX.X% an and fourth strategy. The currency like of fluctuations, year. revenue points robust for margin X.X%. fiscal and gross organic with importantly, to growth was in to balanced X% over revenue was $X.X a are Operating Operating XXX continue which and including billion, our revenue. quarter increase XX.X% Gross quarter billion, million accomplishments, for record margin total level. Fourth the performance to a impacts perform 'XX. a year following increased Fourth revenue acquisitions XX.X%. specific fuel well of I'd year. our begin And the grew of the Fiscal at year. excellent cash highlights allocation expansion generation, Organic growth year.

Our First Aid first operating the exceeded annual time. for segment and Safety billion $X Services revenue in

underscoring Our outstanding across that Cintas and function line services sizes unique capitalize local care, of no-programmers, ahead. experienced proposition our strong only total government Business ability for from offer our and across partners and our a customers growth continue is customers business verticals continue pipeline. customer growth new the that drives on perform experience. value to well. We but of education, focused come About existing culture we the of vast customers X/X not demand across our of and to industries from an deliver to health our opportunity new top to our all state remains hospitality,

rates retention addition, In strong. our remain

operating income of Our the operating growth into the an XX.X% following for earnings, our 'XX all-time grew grew EPS and the continued strong year. profits revenue margin including translated highlights. Fiscal for was performance high. and year, XX.X% in also XX.X%

energy excellence leveraging earnings in on SmartTruck, the supply our is to focus reflection optimization and chain system strategic our relentless with growth and visibility SAP efficient stockroom business, garment profitability a initiatives, and sharing. sourcing opportunities support enhanced greater Our aspect of operational spanning every and and of route

allocation time. for year. billion across operating the generation priorities of Our us each greater cash $X activities the flow first exceeded even provides capital cash capital flexibility to Strong from deploy throughout our

creation back investing over to growth technology, We support term. our investments and people infrastructure, capital Our the value sustained prioritize priority business. is allocation and #X in the in long

create million most us make required and new partners on spent well in ] grow to technologies We equipment, to since vehicles as number with more add to facilities, ways, is as on 'XX. capital acquisitions products a as including range our they fiscal new of $XXX.X As where services. provide capacity we new successful. We of This can in and we've value, continue [ a love acquisitions. acquisitions is new fiscal we the 'XX customers broader offer spent

less capacity Sometimes bring structures, they leveraging also more with route that customers can can existing bring our involve that and attractive synergies time time needed providing driving.

dividend XXth priorities year share we've In the our since to capital our is we public. that dividends quarterly increased through fiscal returning buybacks. dividend, by share shareholders our of going consecutive and marking year Another XX.X%, every our per 'XX, increased including

yesterday. bought also through back fiscal 'XX up and during $X We billion shares of

great to performance were employees Lastly, the reflects companies. It the I'll the XXX the call details the these now eighth partners. is over most recognized to year. execution for our by Cintas results. That whom to respected Fortune our quarter results call to to and honor an fourth consecutive Mike continue for and deliver we the We're we we the focus of turn and named be among prestigious provide shareholders. proud of value successful

Thanks, morning. good and Todd,

fiscal $X.XX $X.XX an adjusted 'XX fiscal global services to revenue was from billion currency last exchange like teams aided of as billion extract the to chain revenue quarter by for was was generate The for Sigma of basis rate compared Uniform of billion an to the fourth fluctuations of billion quarter SmartTruck. 'XX and Facility The X.X%. acquisitions performance year, 'XX Six revenue technologies operating $X.XX fiscal XXX supply of and compared the segment of the increase of with organic year. fourth focused quarter more year, billion for was percent margin existing customers Rental increase great The a products XX.X%. fiscal X.X%. new Services Gross efforts margin organic was XX.X% Our our helped billion well operating growth the last fourth customers compared from our revenue XX.X% was rate as and 'XX last points. Strong $X.XX growth to to engineering for and compared year. via $X.XX revenue quarter last penetration leverage, the of business fourth Gross $X.XX growth and rate foreign inefficiencies as

to X%; I XX%; XX%; linen, last demonstrate be across share quarters. catalog aprons, the services. Gross our have year. and the demand Facility done Uniform of was Keep XX and Services revenue strong basis segment mix was consistent with dust are Uniform XX.X% was for in products we XX.X% Rental rental X%. in Rental the we are improvement experiencing includes Uniform year was the excellent percentages leverage wipes, quarter. and XX%; was garment which of operating and good will all margin such towels between last sourcing towels These create compared point This to for line was past, microfiber, growth result sharing process shop can SmartTruck. fourth was as continue were and XX%; improvements, and segment Services continue hygiene which additional revenue top mix great the As and and that in generate mind, Facility there small and operating fluctuations to efficiencies operating

well Safety revenue compared segment Aid Our $XXX.X margin fourth XX.X%, and to growth. Gross organic capping growth for was another operating revenue year. rate operating First Services The of for Safety last the an the $XXX.X and point as was double-digit off million First year segment Aid distribution million XXX our last Services organic quarter year. has was revenue costs created to leverage, that lowered dedicated solid from SmartTruck compared This XX.X% was basis aid a XX% sales mix, improvement growth our double-digit center as technology. a of that result operating improved first efficiencies

of vary and Our to point year. This revenue XXX of and Fire that percent last and of was compared Uniform result income higher expenses The million Direct were with $XXX.X operating that in Fire XX.X% market. Fourth Protection $XXX.X XX%, and percentage in accounts was XX.X%, Protection was of was the The income productivity improvement All create XX% last in year's to and segments, was rate in in along the double-digit primarily $XXX.X the from Rental of in exceeded Uniform margin revenue improvement income was operating 'XX resources. the invest continuing fourth route to last Direct high Uniform in and able All the was for for last million Services organic Fire generated Uniform year. margin organic which was a quarter Facility Services, Services, all was an same revenue point Aid last while leverage selling these robust XX Sale Operating revenue to The organic businesses $XX.X was marks X.X%. was XX% the X to improvements. revenue segment. costs improvement basis organic Sale XX.X% XX.X% are fourth million, Gross $XXX.X basis year. We Other The quarter point the to Sales decreased another technology fourth to revenue million a fiscal last XX% Other Safety resulting million, approach first quarter Protection time year a as a quarter. compared Direct quarter year. First revenue compared Uniform and operating Fourth million year. disciplined growth. Services to rate XX.X% reported operating $XXX.X Protection Services This result selling from revenue growth Fire of growth strong and compared Sales the as margin with in administrative was can basis XXX from all-time quarter-to-quarter. Gross of compared Direct growth leverage quarter.

turn year. year of year, was to for on fourth $XXX.X for the over our year. provide compared XX.X%. to fourth tax This last was back fiscal the for last and quarter diluted quarter $X.XX an to his compared I'll 'XX. Our call thoughts compared EPS the next million income $X.XX effective year's now Todd to financial last fourth Net expectations million increase was rate XX.X% quarter XX.X% to $XXX.X

Mike. you, Thank

a to customers image, resonate. on their billion that As meet fiscal expect our those value annual safety, time. in we help running This into for needs strong or Every 'XX, We our our demonstrate proposition fiscal results, with and we services-providing, business coupled can first to cleanliness, continues the revenue goods-producing in focus North $XX 'XX has so for outlook, America, compliance. they exceed move need businesses.

improvement and focus As and continuous we culture deliver remains drives our it evolving advantage, the customers' our on for our greatest future. on our competitive needs,

prioritize to continue will people. investments technology, infrastructure, in We and

include continued through investments currently technology our Fire investment process. the our implementation with in division going SAP Our

Google we to with to addition to have for our and for run partners do In and customers business make easier deploy business their SAP, Verizon that with solutions us. technology partnered easier to it our

as efficiencies throughout are as satisfaction well sharing In initiatives and SmartTruck helping garment the addition, as such technology customer drive organization. to

partners, our really will, We know customers. they of partners of working when Our to care are take take success. our we our key the in turn, that care great

we in reflects acquisition future our investing We are that order partners bright, their make training while jobs tools fiscal in properly growth to to giving the and in guidance our our to talent ensure investing 'XX are latest them initiatives. The best also remains and staffed outlook. support Cintas of and easier

fiscal The the points. following: have expected affected fiscal rate billion of our of X when by X X.X% For revenue of have of in negatively and range fewer will acquisitions workdays compared by Each 'XX. will for to in growth growth total $XX.XX X.X%. workdays X impact keep 'XX impact a rate about rate will to our growth XX the that 'XX at Please 'XX, to first fiscal each quarters total fourth in will revenue day workdays. be mind fewer the we note modeling. Adjusting constant X.X% to to The X next and of workdays, currency, for those be billion, to $XX.XX fewer fiscal quarter is organic completed expect already quarters be X%. basis the year each. XXX X Please

variable $XX approximately 'XX previously expect the EPS a million of of expected predominantly the to mentioned to $XX.XX to fiscal debt be to interest rate to diluted X.X% range growth to as in million a a buybacks. portion compared higher in $XXX XX.X%. of complete used rate be of $XX.XX, result 'XX, net We Fiscal share is expense

fiscal not thanking end effective significant efforts be partners to fiscal rate Our same 'XX downturns. I buybacks any by compared tremendous XX.X%, or to does want the future disruptions successful to tax share or our 'XX. 'XX. economic Guidance for our a expected include to their achieve is fiscal

the through continued culture delivering our Jared. now fiscal look on we success outlook our outstanding We remain to As business to our experiences, strategy. beyond. while ahead growth 'XX, reflects in back over fiscal the our long our confidence sustain that the the reinforcing investments I'll drives to customer call 'XX making unique focused necessary turn in Cintas and

remarks. prepared our concludes That

we the Thank Please a question ask happy single if analysts. Now one to answer just questions from needed. and you. are follow-up

comes UBS. from Chan Instructions] [Operator first And from Joshua question our

Congrats if your any on retention churn slight you've comment a you customers you seen or it's strong said quarter. rates. I I your in are on know could behave uptick guess? environment? downtick Have was seeing generally retention, industry I this in you guys that in wondering How stable.

Thanks really We seen customer change for haven't comments. a our in your behavior.

As seen far. and our I say haven't of are so upon we mentioned, change a are base some But levels. certainly that retention have varies that whole, some you are as much struggling. varies thriving And in when attractive -- based It rates is geography. do, speak -- are upon that a at we as very would industry. there you are it I still broad as customer aspects It customer doing our base when based

That's follow-up, QX, doing X.X% then great range? about would in to of I you organic the reasoning to the are choosing bottom for you growth next just end top what just of hear. year? the and could And lead guess in to of the that scenarios X.X% growth context my the talk your the for behind kind X.X%

like the Well, we kind that's where we of is. data going you at we We that overall Certainly, business our -- our about macro those -- really to our that levels. we business read grow target in all economy. what's like And where is. we of where the where on read Josh, types guide we that's --

successful. in So we we we nevertheless, the ways love don't at guide. say change point. watch that this go But for much that. But we result, faster. right We'd be to find as economy to a expect I'd to And be expect even

Our value proposition is resonating.

think businesses XX and have to And over million to or grow. a X employment all the we have we we've -- our growth. in and little growth service that have GDP We I million ways ability market, we exceed shown customers of kinds exceed

our confident a we're adding going be nevertheless, in would and place. But So all to certainly and we customers way love for our over we're to be to successful the people thriving find guide.

comes question America. from from Balsky And Bank our next Heather of

about Can the are you about? about What cost the well? update you tailwinds? on thinking going story margins us for XXXX? how you're just anything margin the kind of are environment incremental excited you're And how in bigger as What and thinking on most

Well, Heather. I'll start,

first global time XX% source, The fact more products the leverage been that's costs, on structure also, system in that go for As to And turnaround leverage areas, that years reflects source they demonstrated to advantage say, we comes SAP working our has so starting we think But ability about think which item team bearing great to garment about our margin it cost done sharing. the they that's growth. improve go again, they have for continue incredible expansion, on and but to have for of us in we easy that customers. an only starting our with or to And in to many that. we'll sources to about the not the dual we hard do but marketplace. How the many so work or with material job And competitive we that a supply do, on as help is guide and our that. fruit jobs, is this leverage, how margin also we've expansion that and chain, their in our revenue it's with the about sourcing. done been do we've our

faster our to our order our and out in having customers versus to So that's Better financials, for when us. it's for us our centers. helps to of stockrooms distribution customers, for product it off new get our better paying

our Andy from R.W. next comes Wittmann And question Baird. from

competition please, those I thought I thought your seeing out would I there. broader. little of offering with there you're a you what I bit the competitive noted on increased start And competitor your competitors could, comment, But competitive is would in comments, the your environment. you just have product and Both that if given have take environment. know and just out service largest I temperature

I'll the that Always competitive have, been for always market. what XX years. you will. I've operate here's tell Andy, highly every been company I'm sure. a we in competitive been I've is with since It's here. day

it to business Now from new from that the being wins retention competition. is said, I revenue because our And part no-program are of tend and market attractive. as come the our rates, mentioned, less

million out mentioned I businesses there's about as million. So We X there. service XX earlier,

their we're space white do-it-yourself proposition of from, incredible. folks doing a to ours. you there it, take their because that of resonating many out it, faster, on And it the do value guests describe or type their it. on call smarter care a than taking customers were they And better, or those for patients cheaper cases, able them is customer what we however focus focused I'll whatever, and, in is So or want to them. And and help converting that to we're we

yes, model it market been on Heck been yes. us. the is good focused It's and growing and competitive? So always we're for that's a competitive

then guess, of some guess a in to the of And margin I different Mike, wanted kind questions appreciate maybe bit little ask I way. I that. I

margin kind XX just was I First, doing the expansion of getting the for as the points I of XX basis EPS operating between around somewhere and was year. or math revenue, the implied

deceleration you the margin saw the just quarter over that's past of the certainly could pretty fiscal of that. But a clarify or year. in maybe course even from So decent expansion you the amount

the seen there's that know, I on energy more areas, be could if weighing are comment aware quarters. continued there's inflating maybe costs, that or that we've wondering I don't be margin if other So just that we categories expansion could anything, should inside should aware in of recent of materially, on be was here we you P&L if any like

about that also, loss short is about, of is answer for infrastructure lose and a the XX so calendar growth to are sort example, the When more heard year. We've talked of the basis to about no, workdays XX a XX us point top that, as our there leveraging incremental of guidance lose lose X about can we we've X talk it, generally maybe workdays, workday, a the But is next in there'll being to call you've And now. But of workday -- the that. of Andy, a us you've We we margin workdays little XX% necessarily bit where the about probably about Having XXX quarter, short you of product a fewer business done basis headwinds, quarter and a answer the you be impact of is little any with the the, a in in from such the talk talked margins. bit the That range. just the new generally headwind. we headwind basis like is points line X exception not points impact. first a said we good heard really still range the job think operating business. think well. if XX% the also

of like the of XX bottom. is pretty the the there's top you a is basis still say, very more so probably of the points margin the Andy. We And range range. There our At referred expansion would XX than kind basis margin very at to, basis XX good it points, points. look more bottom range, of that at

a is this think guide range us. we for typical year, the So

quarter, in worked and into the saw have 'XX. those expect And we have we the on given continue fiscal fourth operational guide, in initiatives so our this fourth hard to quarter. you that the As continued excellence

George comes question next from our Tong Goldman And Sachs. from

government? your a seeing penetrating Can you progress bit you about you're and talk traction? verticals, particularly high-growth health the focused including making good hospitality, are with education, care, Where

reminder, organize we've we also just not a how make those And that like it's those to as a industries, really those verticals It customers, sales we chosen. strategy. around verticals the Yes, the because provide, support provide that. needs as a the sure different. meeting, exceeding their all that And comes products, we the do little that that, they're services with we that along is we're we

exceeding. wouldn't that about out for large I health oh levels. yes, so all a at specifically are seeing helpful an that little technology acute They're care recently that gosh, attached departments the really we attractive the sold network And quite those talk care they're hospital anyone to hospital. But well. having be care operating some centers good to thought recent I networks where care my with with large one's acute that areas. scrub And a bit call also success and the in I'd various we're acute all surgery win had. investments probably types it a say, We of And in doing might hospital dispensing scrubs hospital networks. you're other throughout having

they said, supply care. large about and acute health to came us you a job what in those them? that them clinics, to non-acute?" And So talking but non-acute them doing physician a And have with consolidate to does "You're for X help also allows care for us fact, do say I'd consistent non-acute us facilities. It allows vendors. the facilities, Can great types. systems I'm say their with to I really When surgery for help came offices, centers,

pay seeing good for the we So the decisions, well. those all other dividends investments we've the success they're we us. certainly verticals going care. to we're made are performing continue And in that and to areas, health in think like But

question next from from William our And Mulrooney Tim comes Blair.

to seeing more hopped and late been these less sensitive companies specific that markets? this from if the I'm similar their cited me, Or think to do are your overall individual recently of is more becoming environment. where issue on this idea an you have you're an bid. and pushback dynamic of customers price and more this industry a X few or perhaps if this could competitors in pricing increasing for be addressed, contracts on of Just number customers out wondering a but has pricing I putting apologies so

out say I'd It's really operating nothing specifically call environment. to normal still a there. So

in operate highly we earlier, mentioned I a competitive market. As

we're towards proposition So providing we've our our to got We've lower make back resonating to that customers is to service. that with we're our expand XXX historical margins basis we've point said just pricing seeing. And out pricing, sure that I we what even fiscal customer able value points. operating as in that's is levels outstanding would 'XX, -- and were we're plan and moderated

And that great finding provide our of pricing extracting ways while we inefficiencies so but improve our operating so we're value to can business customers for out moderating still margins.

Okay, so as not you really on incrementals this more strong headwinds you -- seeing now still that pushback process? on fully pricing. is Or that certainly we as And moderated. moderating are in That XXXX Todd, you pricing not head is would had pricing? into quarter is there that pricing you say no say lost it us Would from normalized? has

as market. Tim, mentioned, competitive we've highly I -- a it's

is continued what have to base operating local those their is a like, upon doing, moderate And subject. customer We pricing. their types. pricing depends customers, It what environment's really the

on term businesses for a making it term our on in and monitor manage manage the and local we manner. focused the don't pricing that term. near in to of continue look we we'll and thinking at about value we're customers' it say, focused continue So and to We're upon needs short that we're the customers, or long that the long-term customer and because our sure based appropriately our meeting

to 'XX just change. I of not Tim, might lot fiscal add, year-over-year question, pricing to 'XX And your fiscal probably a

our from from next Andrew Steinerman JPMorgan. comes And question

clarify it, you believe ask to going just could you something just to said. I'm you If

you hear price increases So about existing increase. modest you hear pricing. pricing, modest of moderating when year-over-year talked price really moderating is for then pricing price are decreases. a I normal mean fiscal about the moderating type words you're or you When I And about to what flat talking assume I 'XX, talking more customers?

way that clarify, modest it, is based with to upon you appropriate. are moderating is price the customers, it agreement we characterized It's pricing increase increases through general. price which described a And But yes, customer. passing our et upon varies customers is and industries, cetera. based Just geographies, that way modest in you with the relationship

right? the for That's true fiscal too, 'XX,

correct. be would That

Good clarification.

And our next Securities. Bibb from from Truist comes question Jasper

what hoping 'XX or growth in net your at guidance. bit more headcount Was as as hiring could organic color posture and any a embedded expectations you far on give customers fiscal you're seeing there their

Yes, it really varies.

hiring. I mentioned, customer in base is, pretty to it quarters. We're seeing hasn't environment stable changed geographies I'll change but in such As and we have -- behavior really broad a call the customer much much past the a when comes really it, few not in

business the national it. Maybe some asking differently. about X competitor talking at if including an pricing of dynamic of for this Last a Got churn, little rate, not retention are a these increased some hit, With question you bit me. taking peers whole earlier or of this a larger accounts, at you're potentially higher seeing away given market dynamics?

is it here's a really we environment. way describe competitive in I'd the Well, operate

our trying the business can organization be every continuing that And there competitive. to take best fighting best wouldn't much characterize I services, in the of out And marketplace. for really we're so products, It's technology they the with care our the position really the in to the to do change of And environment. best day. as always so best a customers try successful we're it to

Patnaik our Barclays. And comes from next question from Manav

I just years been now. for talked had how X the question. in M&A Earlier, you about active most you've many

more little and just future bit you each why the now So about M&A. just a looks pipeline curious for talk your like segments in what if of could perhaps

sure and that well they does have we decide think predict. about know, that long so positioned. want to We M&A, you relationships make that term we're it's it when someone As that tough to transact,

be products those. services learn breadth that can attractive great we again, we flow. people always us set offer. There of, that offer we deal us. cases, of highly new from -- some we a we part because predict I to long think find gives want to tough be term, really it's earlier, get to it that in But customers get synergies. And attractive we about we In of mentioned and So many wider large a and M&A as and really and can we infrastructure is important

M&A to we're the make just markets. So active takes yes, shapes sure at pace in dance. those X to of we're interested and all we're want sizes and highly it. And we Tough It dance and in to ready.

And Scott our next question comes Schneeberger Oppenheimer. from from

year X of investing first your just capabilities, you've speaking the technology, been The management selling course in is the about training. over

you an been a alluding Just portal. anything quantification on And myCintas lot you've about penetration else that's about put to there. how update also, or progressing? that Any can

position our you for their kind in Cintas? more put successful. trainings put do our in on do it them It's constantly to and to to tough people making reinvesting about those customers We're for that. business It's like, make talk do culture how to of those with We value the be easier of us. a jobs number it to a on easier technologies,

all to those people long-term are So investments successful are that thinking, positions investments be long-term in marketplace. that our the

many and Cintas them to value less them allows self-serve to Cintas. give more -- with investments, but to communicate easier customers, that to great customers off investments of the those out want taking continual an partners them. do it think them for pay of jobs make Some And to investment. make allow have laborious the day the a to it's care have do is with team that to those data ability customers. it And -- of their it and every provide when We about are faster we make for also it we want business amazing and we conduits

ongoing have will to now appropriately key the perpetuity we that's So where role. and frankly, that ongoing really our a business technology team successful. of sheet a all nature probably and be invest plays blessed because to And we're in balance position those investments are can be,

just I the the is, fourth high and figured fiscal in the And margin. all-time quarter operating year-end on follow-up

a of kind conceptual longer-term So question.

since done have what What Can targets to from the you guys XX% you get it. be Can XX%, reaping can you've to XX% incremental about Just and longer peak margins, aspirational get to XX% mean, implementing some on great range. term? You get reasonable. talked I ERP would you promptly? benefits margins? for consideration

to we put continue but ceiling Scott, on I we margins. certainly to this, like don't would our think that say we a can aspirations, improve

points. of couple a maybe so And

XX% to today. locations we've margins, XX% operating at all, the are of level that XX-plus incremental got First operating

businesses. -- and in that's And all so our of we

we there there so are pathway is And work on it. to continuing a and

better scale it's Sometimes and density.

little product of a it's mix. bit Sometimes

those the of get we of And locations newness closer location. to closer there. we operating XX%, the all to But work we're tells us, to in minds, it's examples, those can work operating and continue to and incremental highest Sometimes certainly, our our have margin that to range locations. get -- of continuing XX%

yet. rental technology. a fully And would much, you to we're -- been you've at much say not little SAP we've is about innings it's has the Fire since the since I of become about on that only back our early the on bit -- talked in business still operating system. X We've better been technology. go As on been years and

touching can Not lot come And the have better that think to continued of expansion but getting surface things be we big certainly XX% last and and date system. at have we'll sights SAP Verizon just we to so continue and margin there. or the into hit to there future. ready we that our we driver work XX%, or over about can on hard the partnerships that of are know, the we been in you better talked put using with of are and But our get a a when on. And that course as a still as that can Google we've so, year

Shlomo And Stifel, Rosenbaum our Nicolaus. next question comes from from

of Direct little there for last bit alluded quarter? you 'XX? Fire a SAP Sales Shlomo. be implementation to Fire Adam the much in impact a margin This for the you of is how should Protection business from businesses Uniform on Could maybe for provide And outlook just and

phase be that, training business Protection in bit the that implementation, training when period. specific the better. And and we that. margin. then terms be get in through, use still the implementation keeping better we're and But of little perspective, of of through of Fire pressure a of the inefficiencies going our 'XX go we an with is will work of the to it, year implementation all along to people a implementation, is guidance be mind of to a going little there. that come there's And work and fiscal their pressure some to going as a I'm there of a not there'll From bit go give on we in

on a said bit on mind programs, going of our little that, included based guide From to working within all a so to Direct the the overall tell our on pressure a But would Fire, margins of area. Sale really selling incorporated in and there. right job little Uniform guide. be Uniform that that implementation of types that's say And great doing been that's margins partners overall We've a I of in with Certainly, bit improvement. having have our that's margin but perspective, Sale been in are keeping hard our SAP good. Direct

from Ashish from And RBC Markets. Sabadra our Capital comes question next

growth end industry a over question think the inflection the when growth higher organic profile historically, growth we about And to organic raised just because of you continues throughout on year. and guidance where has it guidance in to robust to the but in the moderated philosophy beaten at be you've pretty guide implies quarter, always the The X.X%, -- compared an growth. quarters. still X X% the have the last set guidance implies Maybe the your

really terms think see do say, we the conservative philosophy, it the in guidance inflection? as where is about of seen as have you we So years? we when in prior equally And

norm. last was really rate maybe Well, where, and that year you that had little year XX.X% price were levels. this XX% year, X% an were these know, our than Ashish. about something inflation. of closer sort at X% higher this, a just years and year, we the historical I'll to bit in back we a growth this bringing increases heavy got pricing as where was previous year to say the year. again, We was a the in good year And And And organic there

but you. lot a about I'll change had had of in throw year seen in couple really As we've And fiscal not numbers guide, we've full of we've our Todd a mentioning, good X.X%. In -- just our growth the point guide X.X%. guide, was simply quarter, In our growth our out about to quarter, total for you our third if fourth X.X% performance adjust total we out think a a range as workdays, maybe has been some the is 'XX was when I'll to In think our And workday, X.X%. couple. the customer our you behavior.

in So you of is saw operate our in effectively the telling same we're the the manner year. half range seeing as we the much of second guide business

organic quarter third at -- the those and in the look next numbers fourth story. you year, same quarter, in If

But second guide our you've bit so Uniform And the bit seen consider a of really is fiscal top Fire alternatives. Safety, fiscal for philosophy is in the on right have in we that range half to businesses, the a because look, little line we to First in 'XX. nice is line 'XX Aid certain of, effectively, the range build what all growth a and Rental, particularly And certainly with and of in Protection. of have

hopefully, So bit, little a Ashish. that helps

that's No, color. helpful Yes. very

question next our Bank. comes And from Alwy from Deutsche Faiza

the space the in the traction just with white you're earlier mentioned about opportunity call and getting you no-programmers. So

levels, historical been the contribution to to relative has think growth from no-programmers I higher.

pit So environment? sort about incremental curious Is Are you Has if can differently. you just underlying of technology? what's changed there curious no-programmers. bit? talk I'm from little using doing maybe something the you're driving about the a So contribution on what

and start, is to pie we trying and now, to of you'd space business, decades a significant. that Mike, white have if had on several for contribute. I'll and like Faiza, grow the good the focus morning,

organization been real our we people about something just part It's teach how and more that's be process. to of doing And how concept to. we've obvious for they change we teach organization conceptual out it, well, approach would it's get it our so get blessed the and them keep long this. how culture. how our partners grown sell with to And to And it you call But we've you them instead how all that. And think of that's it's outsourcing. takes because better, space of do of So on struggling happen where the faster, our key I again, am it harder And attract business about fundamental point our little we'll of a been into It's being -- to our the with a part of you've teach for I'll future. in operates. And simply to train part And we our I yourself. And a over get different to conceptual there. we with how concept continue do I can of how on maybe a a there folks us. that no-programmers. say spot that. to across is a sell than cheaper -- people. we to how to it's and up it yes, doing do teach of, can business white that's exciting And it, a just No smarter, can. do resonates and massive They it's concept got the grow years I'll versus something, it coach different about more to

I'll bit. a maybe Faiza, offer this

maybe that, of kind vertical different When needed or it's a a decade because the about we've we been care that sales think relationships. you we a now. so for health team into to of If kind create different just in sale, got

And had product we we kind we that, a create team. sales of so with because maintenance different uniform have started a maintenance broad rental sort to When didn't of uniforms, we did offering. and

us. a in product continued we started dialogue in that the programs And microfiber. we we them, started to we for off nice rental with and As can has take and started like started business, customers how to learn things we and else that help become through microfiber

customers. them, that out we of, As These scrub have again, evolved our of with rental to programs. into how sort help then came we dialogue continued dialogue can with

our from being able along largely that if creating of now. has information more health a real so innovation better of new this our then revenue to having of customers fingertips, nothing our And the at find because partnership, call products it, And people to in it's that our that prospecting. almost X% with grown care technology and services. some nice for and couple flowing vertical, of gets we dialogue creates of type this with new our to, And innovation, with of us then adaptation

on to been grow As have, the productivity. what through the be, might over able better the warmest and have grow time, and that, and able tell products we we leads customers where can so which business to

more of all that overnight. they and our continued and more happen do don't what They evolution to the things And collaboration so with that these do become with dialogue and ingrained about, them. in Todd customers we talks we are

the collaboration, asked innovation, white continued you so productivity This evolution a about space. improvement. wins, that the -- And technology of is just

follow-up helpful. very That's on CapEx. then a quick just And

the how I I a increase as a a CapEx saw CapEx mentioned about apologies it. if of about we we gave think talk investments know priority. bit And in don't and in going I XXXX. missed that number, you forward. some know an outset more at specific but just should the You if

We of were revenue. percent a about X.X% in 'XX as fiscal

had in some catch-up purchasing investment You the year. might X% through X.X% revenue believe in remember, to of we the range. for had bit truck We is little CapEx of We Fire SAP a the Protection. future a that the of largely

we'll 'XX. where fiscal up that's likely end in I think

Stephanie next comes from from question Jefferies. And our Moore

environment, maybe to question been from and inflationary question. there wanted and just just Has not way, of are follow the you of do maybe contributing that have it So and that last increased another viewing kind on up in-house initial a outlay is quick differently? to Are value taken coming that kind looking the your higher a actually with new finding driver potentially X proposition maybe some growth? capital proposition I activity to value in. customers

for outlay their Certainly, where guests, you you garments, their customer, And there's free their large restrooms. do We their business, up make customer. the us on their you the want to investment that care that go inputs and versus if to for rental in with that for you, it. might then there's people, capital buy we we of have patients. other focus them many program, a chemicals buy customers, what if take towels, a to soaps, areas their again, doing Yes, or uniform are behalf. dispensers And have to on

again, they from who And sales how over where the are it. customer part I'm And they and and really we've it responsibilities is the were of I our care and throughout we hire realize ours, like and didn't But our those our is. customers help that can over it I've team average-sized small at you many, get to me to those. that Certainly there whether wow, spoken they that our years, take can think were do to didn't rates, seen me, when surprised to people, that pursuing the say, out up. trying that message average-sized actively big over that many out, contributes for realize and of small. the it's that again that's environment customers customer, -- service have competitive enough could where a So years. do sure people frees we've to And I they're busy, you benefited customers

it. No, excellent that's Got Great. color.

last question for me. Just

space. maybe You been aggressively Security a more in Fire It's good year. to or be curious for Safety M&A Fire I'm this would vertical talked aggressive and what past about appetite the being your expand more a you. and in bit

or it space. with area a a white think an is I market pretty considerable

just So your vertical curious that specifically. within appetite

And all just back a was of fiscal people tough again, more would this it and change we to decisions. the about I is, flow. Yes. is able our That were when deal call predict. wouldn't invest Stephanie, year that's timing, strategy to a it in M&A the make I byproduct part. going timing on being in flow, It to describe way more that said, 'XX. than way

the Fire in we're we Aid As acquisitive far and business First single as business, Services that the route-based every have. Safety and

we it's chosen installation have the that to and business repair after business amount because inspect our us, test come have business And In kind have specifically, in businesses. significant business aggressive of be evaluate new decision. that attractive we're good like that's tends to make deal bid those participate and tied good, tougher to there competitive every mix that like across of some tougher so deals a single are we attractive to is construction. us. that as of we sure The and along chase make to with to meaning -- to of and kind in that a Fire And really deals. that like And matters a very of the want there's we It's business not installation desks we not to the a and staff, well. And X that business. as meets mix and

really path. Again, would So the all both But continue acquisitive on the highly we we're -- like like we've chosen to businesses. to that avoid route-based and those.

back turn And questions. further there Jared to are closing no over at time, for I'd this remarks. call like to the

you this us for joining Thank morning.

September. in you We that of speaking will issue with first again quarter fiscal at forward time. We financial our look to results 'XX

today's concludes conference participation. This Thank call. your for you

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