Cintas (CTAS) 25 Sep 242025 Q1 Earnings call transcript

Good day, everyone, and welcome to the Cintas Corporation Announces Fiscal 2025 First Quarter Results Conference Call. Today's call is being recorded. At this time, I would like to turn the call over to Mr. Jared Mattingley, Vice President, Treasurer and Investor Relations. Please go ahead, sir.

Ross. you, Thank joining for Thank us. you With me Executive Financial President Chief Todd and are Officer. Mike Chief Schneider, Officer; and Hansen, and President today Executive Vice

We from analysts. results. first will will the fiscal commentary, open questions our we quarter to call discuss our After XXXX

subject to which with the filings civil in uncertainties, These refer may contains and views to contained Securities from performance. differ could recent forward-looking to results risks and statements discuss. reflect the company's cause Reform Securities current statements to safe materially discussion Litigation you we statements. future financial points most forward-looking Private of actual XXXX that on and for The a these are from Exchange This as events those our provides forward-looking Act harbor litigation conference call the I Commission.

to call I'll over turn Todd. now the

Thank you, Jared.

with pleased are year fiscal We start our XXXX. to

the proposition by all breadth quarter and of first strength employee partners. value our and results types Cintas' Our of reflect stellar businesses for execution

$X.X revenue for quarter. a First quarter in revenue X.X% high all-time billion, grew an total to

was revenue less the of quarter First to work XXXX. XXXX growth the first quarter by quarter impacted day fiscal fiscal of first compared negatively in X

quarter that X.X%. fact basis, there quarter work fluctuations quarter. foreign was X.X%. acquisitions, in same-day to the for less of a was On our the of Each divisions the contributed growth revenue X The day growth first rate, was organic impacts adjusts Cintas' rate the success in which currency and business work exchange

customers double-digit growth, and for The and businesses be, all division and of of our of them Safety with sizes delivers continues long demonstrating complementary and Aid the products was platform to First across will right year-over-year Mike generated where our and to future resonate growth. rental industries. Protection runway services As Cintas and value each nature Fire like our our detail, we

million only services, local tremendous new state businesses businesses perform of In and opportunity we hospitality, but serve experience our our we customers, well. to first government across across existing quarter, to focused have XX continued continue X not and America. the from to education care, pipeline, our health for on focused verticals We the business remain across North demand strong

year. Our was to top reflects flow to increase Operating results bottom to the a split, for the of a through which year recent increased Gross first robust also the line X.X% record, line. all-time quarter income margin EPS, our an a $X.XX. an as prior of XX.X% Diluted of prior revenue X-for-X XX.X%. stock percent record XX.X% the XX.X% over over grew

and focus SmartTruck route Our the excellence efficiency operational of continues optimization to cost, every business drive relentless aspect strategic down sourcing SAP that facilities. to and reflect our our of growth material and earnings our leveraging supply on our initiatives chain our in with system including energy maximize

increasing strong was flow Cash the flow very year. quarter, with over cash XX.X% the free first prior in

us of capital capital our cash each to allocation generation priorities. enabled Our deploy across

employee partners. our strategy our continue focus that allocation our investments This capital value and to long-term us priorities in shareholders. to position our reflected strategic continue is We deliver customers for our in to

segments. million continued of we acquisitions through expenditure to route-based our in and our of capital invest X quarter, each first the businesses $XX.X in In made

investments are area of a technology Our significant reinvestment.

processes more and and strides have to increased to achieving our investments operations. standardize implement our our product sourcing. enabled to more technology-driven sharing great across We better garment customers, nimble us flexibility provide to These are efficient including making solutions

our products employee and partners customers Coupled able get and with our we're Google right easier the faster. ongoing partnerships SAP, with our make to Verizon, jobs to

to our margin We profile. positively and continue experience customer are improve impact efforts seeing these

to cash capital our which in investments growth, share, dividend a returning dividend and per shareholders key XX.X% Cintas priority. In the addition quarterly increased repurchase to by Cintas making to its through business dividend remains this going share future fuel increased every million X. we aggregate $XXX.X dividend the public. an have in payment on our resulted since of practice XXst quarterly meaning year year consecutive maintained September This that we marked

We $XXX.X the stock million quarter. also purchased common worth of during

our Before in our over the safety, provide cleanliness the our quarter first which the and our customers call helping turn exceptional to financial meet of to needs. our expectations reflect quarter provide through updated carried the results, we dedication momentum employee of I partners Mike first details I'll year, image, compliance and for fiscal

XXXX. We are fiscal increasing for range financial our guidance

billion range from of raising a $XX.XX revenue range total to a are growth our rate of to $XX.XX X.X% to $XX.XX a billion, billion We to X.X%. annual expectations of billion $XX.XX

rate growth of be X.X% organic to range the X.X%. our expect We to in

I raising ahead. are of annual the growth remains from to $X.XX rate expectations We also of range to EPS to our XX.X% a diluted year look XX.X%. $X.XX range forward and to $X.XX of a $X.XX, future Cintas The of bright, a to

turn to results. With over to discuss quarter of first details that, our I'll the Mike the call

Thanks, Todd, and good morning.

to year the number compared fiscal in the acquisitions, year. rate billion rate, to currency first work compared Our foreign period. quarter revenue points $X.X quarter was The was $X.XX exchange prior days, X was the fluctuations a and organic revenue in growth growth to XXXX impacted billion difference last fewer for adjusted negatively work by Total XXX first of X%. due basis day

As impacted in of quarter. our will fourth a days. have and reminder, X second our XXXX to quarter, fiscal fewer fiscal the XXXX our fiscal XX quarters first Each impact One we XXXX. days has compared work

of for compared XX.X% and Fire Direct Sale Services, and Services margin Uniform X.X%. Facility for Safety quarter Protection X% for billion Gross was Organic $X.XX an down X.X%. for fiscal increase the First first by year, growth was Services, XX% billion Rental was $X.XX last of business and Aid 'XX Uniform to

increase last XXX gross margin of for to a an of of As points. reached compared revenue milestone year, XX.X% quarter the mentioned, percent 'XX a Todd as first basis fiscal XX.X%

generate to leverage. continues growth volume Robust strong operating

chain, result supply made technology world-class a have continued in also Our investments our efficiencies. of and operational increased we gross margins as

Fire Gross Safety Gross and Services, and was Rental Uniform and for for Rental XX.X% segment First and by margin sale. the XX.X% business Facility points Aid basis for from last margin for increased Protection year. Direct for Facility Services XX.X% percentage Services Uniform XX.X% XXX Uniform Services,

leverage generate result as to Great strong lowering continue of our costs. our supply We is a our chain revenue from growth. product performance

teams. from through continue realize our business investments, extracting and are inefficiencies the benefits We Six to and we technology our engineering Sigma from

Safety the XXX points margin First for Aid last Gross year. segment basis Services from increased and

create with As our business, leverage. rental growth continues to revenue strong

in revenue products be stations profitable recurring WaterBreak. like more continues to with and eye wash first AEDs, sales mix Our favorable increases and aid products our

dedicated center investment continues Our ago, we that years see optimization route costs. opened has several and technology our us to we distribution continue in to from SmartTruck allowed to product provide efficiencies, and benefits that First Aid lower sourcing improved

contribute margins. to improved All these of

was administrative of percentage which XX revenue point as expenses a Selling a basis last and from XX.X%, increase was year.

and We continue to strategic investments partners. in technology our make in

First last 'XX first XX.X% quarter to was $XXX.X a compared last income $XXX quarter, operating quarter XX.X% fiscal in of compared as in XXX Operating to million basis an year's increase year. first the of percentage was million income points. of revenue

first year. quarter the tax XX.X% XX.X% was effective rate Our compared for to last

in certain impacted rate impact items accounting quarters the both primarily compensation. by discrete for tax were The tax stock-based

compared This was EPS million last year, an $X.XX $X.XX XX.X%. million of year's first $XXX.X first compared quarter Net income $XXX diluted quarter of the year. last to increase for to

has free Todd in the invest As $XX.X first we in earlier, increased quarter has back cash allowed resulted strong our to flow, which XX.X%. business, mentioned generated first capital cash This of quarter expenditures flow us million.

top the to line automation investments improve plants to processing and and Our where technology needed. additional expand in grow our efficiencies include margins, capacity

X% expenditures capital for year. expect between of the X.X% We to revenue finish and

million guidance. previously our 'XX to following: be a share expense the as debt of million a the result financial annual compared of Related variable $XXX is fiscal please expected the Todd guidance, fiscal buybacks. in approximately to predominantly net higher used mentioned 'XX, to rate complete portion interest to $XX provided note

XX.X%, effective not future include economic or to our guidance downturns. fiscal rate buybacks any is fiscal tax share And does disruptions expected same compared Our 'XX 'XX. to be or the significant

Todd With for that, some turn closing it back to I'll remarks.

Thank you, Mike.

employee moment continued of customers on our to efforts behalf quarter. first a conclude, the for Before our in thank take I'd their we like and Cintas to partners

before, said is culture our advantage. I've greatest our As competitive

each Our partners importance partner fuel having share our of in success, employee ownership collectively the the company to and we deeply believe success. in that in

highs into effect Cintas' in X-for-X stock, record spring, the As approved reached XX. shares on market split went Directors which of September our opened Board of a before the common our

to of in of for shares Cintas' employee especially the they can the investors, We proud growth so are for accessibility our of Cintas. our continue to share enhance partners future all

customer our remain reflects the ahead Jared. delivering call sustain look proposition cleanliness their outstanding focused 'XX, our experiences of of image, turn making to over 'XX in our the the continued and I'll in achieve rest the our outlook to value strategy helping to for back and fiscal compliance and remainder we the confidence on beyond. of growth business our needs. We necessary customers fiscal and safety, now investments As

That concludes our prepared remarks.

answer We are from to the happy now analysts. questions

Instructions] [Operator

Instructions] [Operator

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

a macro behaviors macro any seeing talk in and environment bit response overall changes evolving about selling little to and Can purchasing overall you're the whether the you customer in uncertainty? environment

for the question. thanks George,

full frees just customers, for helping of our customer are. from them, ago in whatever and XX change image, cleanliness their haven't needs. people, It's we the we're constituents patients, And their that that our demand guests, most our earnings. nice their to up taking and what's their much much seen fiscal see year not We still 'XX have change. safety, We -- their on their we But in focus seen reported days their care important them their with compliance behavior. them

demand say, change, or customers. much not in the in I the would of cycle sales So

you're compares hospitality, company? performance Got a you for company. as and focus bit more traction and care, government That's versus Can broader verticals talk those education the you verticals highlight health the how it. and continue seeing And little in there growth about helpful. key to

Yes, certainly.

them. starts but like give we've example -- just how them look I culture. that. I we those believe we at care this do sales not would verticals invested We well. But an We've our them take holistically, a of thought those So of vertical, just those and we with run all as customers chosen very of in

discontent that which on positive at Cintas, of partners. not focused meaning the spirit innovating. And we with employee -- call we our we also is in answers a and answer it improving is constantly and what is our our meaning the customers desk, have we're are out believe We believe

our we travel So we customers and can we talk about help where to them.

customers examples conversations. have those where I from exactly came health in X that we're helping area the And care

with success this and we're was, And told care continuing bit first they spoken have little inventory they our very problem we've health The technology. dispensing, what the was of there's garments a and scrubs their those they so this lack garment get who later us with didn't don't had to in scrubs, good you customers, a this managing a case takes of show garments gets of as first a hoarding that leads when have the the accountability there to accountability, occurs, with meaning up garments. which don't person availability, then who about have

care ICU those issues. they the for labs, And -- and are cheap delivery, it's didn't call where invested in many radiology, went we're product labor when wanted used examples technology that. have room, being health of rooms, well, operating as most they today, addresses and customers, in possible, over as some control substandard this part, emergency I'll the areas, cath what clinical as inventory, doing because a they the result, And

think compliance And cleaned. recovery you be top with? about and them, they're problem rooms found they they us they be and have on rooms, we frequent patient privacy else to are having ask is also a we our the emergency throughout And opportunity, to They curtains. medical we in in issues. non-acute we And what those in privacy We those, have centers. And curtains, but basis. to of told a of areas, they're said, acute care, was their one clean when heck when you a exact centers "What help can meaning it surgery spoke customers, same with

a compliance it's for so our And challenge customers. real

environment, the clinicians compliance, in a so the patents have rooms cleaning areas Those at up over -- the a to them compliant environmental and it makes where makes care. with safer organizations environment, So it it technology services we track just came and and some allows And great those it who We products total, up listen to for them. for are technology. studied and provide frees take And more other we as on products didn't well. us some patient problem.

safer So a more cleaner, and environment. compliant efficient more

listen might particular but we bit a it we're that in and to in just we with then our provide that we the really thought our little customers help doing color of starts give help what we can dive culture, to I around So vertical, and where and solution.

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

This sales is quarter? your have and Luke of no-programmers between might missed McFadden wins on new I it for conversion provide but for prepared could Mulrooney. Tim in remarks, the share the breakdown you market in

with We Yes. but cite The no-program market from new meaning not about of historically traditional a that On come competitor. did to not out no-program specifically, what trend. the would customers call we're change we that it market. our no are X X of they average,

they we -- meaning but they're might mat, Now in might using with have traditional mean soaps, they uniforms, competitor. that need and might not a and go services, not they a help that might they with own buy doesn't they're products

So they but on be better, help do redirect money in faster, cheaper them ourselves spending we may products, to cases. it those many them smarter, to

of like strength some end no a no-programmer Are that in Understood. maybe that program it broad-based? And the particular or topic an Really market? concentrated the offer profile just then helpful. on recent area majority of the insights Or wins to continues hoping It or in business. of as sticking these relatively be of could size specific into any business Was recent follow-up. of these typical my is you conversions. sounds penetration kind

of beauty a there's customers, North service in America, and million U.S. over We the and Well, little businesses business. million our X Canada. that's XX

on and obviously, we from help in, see future innings early and the white much there. sizes so wins opportunity, bullish the still of space the shape, as to that's that opportunity customers, there come And all significant all industries, a we're businesses, that because out we're why very so

comes And Steinerman our next question from from JPMorgan. Andrew

much year amortization in This amortization of is the And in Andrew. fiscal how a you is in Year-over-year, for a Mike, could headwind quarter? merchandise assumed you talk tailwind? about or have merchandise what the terms amortization? merchandise trends

I'll the material for material the at of cost. area others. an business in, And strength cost I'll has Andrew, the cost has But stick also second. business the been a us rental but for that been we to trending say, nicely. Material hard rental work

of about think source to within finding supply there, So product. global ways chain can and you our better better cost

the know, And And really a really other great of and really as work volume hard sharing growth they've garments. is we've rooms done there business good despite so that job growth, you in our the had. Andrew, stock we thing that the at,

the that pull out in share means the service. we out are garments, we the garments fewer into we more terms and more of of get so And injecting percentage stock rooms, our

things would showing year. have so the tailwind, And we those of see combination created that margin, the you fiscal will gross nice through continue in expect some and our that up

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

the to ago the over think few partnership, announced now, ago. ask you little Google migration a wanted I year quarters I a about that a cloud SmartTruck and

of hoping be progressed some us kind how margin on Just that's update might this seeing and efficiency or stage? associated could where at benefits you you

customers time Jeff, because the that work question. to is, helpful we're business. driving, very specifically, of our able develop. it's time Yes. a our But proprietary for -- for thank to as customers. spend reminder, for you It's instead helpful SmartTruck our to more technology been is with more able spending we we're

with in the privacy and and something dispensing Whether and -- so customer opportunity with I business really minds So for customers, is their with else care business, those time in problems when we're like solve eyes curtains, gives our garment ears valuable health us scrubs mentioned there in with it's and us. -- more them. it to and with the for

stop when like we that here, wheels moving. stay generate only any fact when really make the the we from money revenue the don't money, wheels Separate trucks. to are around our We on make

that's been So valuable.

very Google relationship is relationship important with Our And relationship with advantageous. as has our SAP. as been with Google Google's

to So infrastructure place, business, leverage right the partners, gives our insight them having in spot, to put combined the the our right us us and that helps right our leverage into all employee time.

be that, those to is that into going the we So value relationships. we future, really beneficial believe and

like in today. hear following to point, in those maybe you're good And fire you called are past SAP initiatives where then the the also in growth business that sounded -- it the doing the some implementation some how like that on up and margin Any be stand And out pretty last would where first there of on G&A great color the the operating of investments underlying quarter? in a quarter. the for was

Yes. Good question.

some we the But us having So in opportunity incredible, have have about legally really really don't and is we're business. And for The system. us. M&A business. extinguishers, cases, will -- the customers today. growing it's We're business, love one We lights. around of amazing. about our opportunity investing emergency that. that that investing whether all system, nicely. that because think It's The systems yes, route-based fire, our it, just for into certain fire in business opportunity really our on it, excited fire excited every We're in the it's business only that attractive organic there insights is SAP have give sprinklers, to alarms we're we every in services out the we're

for how the that's the know us, the aggressive margin and appropriate. is but do not comes will be run result, of a it, We down opportunity know as attractive We We think really the business. business attractive. really And in pike every to as that to like we how attractive runway M&A profile. So we that is know business. we mix the

as things well. I'll with Maybe that offer two

second is this the in gross a XX% lot of prepared about You Todd that so well. talked going in the remarks, quarter that reflection and the margin the really fire of running things the say a of heard well was a business row in business was that and terms in me

think and implementation little margins in of fire the of on that that fiscal a SAP implementation. in about I because that are I of back midst bit mentioned we've pressure 'XX We be would talked July, that there in

it's QX SAP a bit coming if And at so look that down of operating of implementation. you QX, SG&A. bit to bit and you And that of we're reflection from the little through all other see margin, fire a a

and It First in some subsequent As benefits there that about, that takes you've Certainly, how and Safety talked to nice all in to that and running we've that seen businesses, Aid it but getting rental our business. into in we've 'XX in and time, the run SAP some overall guide, incorporated bit learning implementation. may certainly are guide really it. the system But little show the of fire a pressure given. fiscal as SG&A is

And comes from our Barclays. next Patnaik question Manav from

you the tech, confirm element energy. I it more Manav. Can on efficiencies, of strong was opportunity? whether the from Ronan I favorable there? is upside an in XX see operating margin This please you expansion And Kennedy think, sourcing, sustainable to it ROI The there's do supply in growth mix, onetime bps for said is chain, margin drivers? factors expansion, Or any

there's in to as for out call we one-timers our thanks out question. far can come. go Ronan, with as inefficiencies on more this. and where extracting focused We're the business, to No

see to in opportunity don't business put like that there, inefficiencies. but our ceiling So to on aspirations a extract we we our

And do so that. to we continue will

in standpoint, range. guide I an that I we've incrementals. XX% to think operating about talked XX% reflects think And our margin from

industry your ask and Got may, competitive industry you within changes, allocation? the could think activity please capital dynamics it. whether -- about recent what do I within And then for the current

speaking you'd correct? clarify. M&A. you're Ronan, that Is like Or of to

potential implications potential and process allocation. and on capital dynamic please, M&A your Yes, thought of

our we it's on stay for a in of Well, throughout, like aware has the Great. -- certainly for good we been and what's shareholders position. well and going we're in We of component M&A worked spot. business, our important think our will and is an business, our we be, our very marketplace, competitive customers, are

sure will we're that We positioned compete to the in moving marketplace invest continue make appropriately to to forward.

and where is, that's do. we'll our what So focus continue that's to

next the from And question from comes UBS. Josh Chan

seeing. see much do that wearer you're in what relatedly, you business, rental you Cintas confirm levels? talk playbook wearer you attractive you to that growth to the the in moderate you On about the and seen And if to were haven't that in change kind levels can sustain economy, to scenario of the could start could used

thanks for jobs to Mike, start. certainly feel in. added. chime Josh, question. We when are love I'll being free the

being employment and a our we our can multiples But business, we've grow seen growth. multiples wearer change in GDP haven't levels. real business said, demonstrated in that of that We of our

With and So think jobs for we are our it's on certainly and customers, not love good added, for said, reliant that. are good it's that it's I I our good for being business. being when our economy

We've also can we we're So that that. demonstrated grow not cycle reliant every type we've that seen. on virtually in economic of our business

take doing our we'll focused to we're on future. partners So and employee of we good incredibly be positioned to for successful investing exactly future can the so in invest that be who continue customers, the really that just to our that, for care position

quarter you want I'm low asking better guidance internal color growth that. And context of QX guess Great. thoughts at I around on the And Just was the your expected than raising expectation? on in your guidance, full end? was year your -- the in the the

it the guide. as -- this. have with up the the But books, say a generally bring growth can we we quarter a little lines I'll feel in like of we quarter now the we more low Well, little bit up growth high a confident guide. Sure. end first it's to to our -- of the was be. in and at end nice The where It saw some

that, range the too work of QX implied from rest X, And work range, day when to basis. X.X% think of the same year, not about the If think on guide a X.X% day for we're that about the same X.X% far to range you you X.X% it's through guide different year. a growth for

organic this X% growth quarter, the that we is first saw growth in we want to look, where right be. So

think, And is the look, the we some of we're I in way rest have that the confidence year guide, -- operating. the for a reflection

We haven't looks still good. change environment a lot in operating and the of seen the growth

strong the on quarter. Congrats

comes from R.W. Your question next Wittmann Baird. from Andy

degree You automation. the talked about guys, in of team, engineering script, your

kind was rollout if you how is of you're take could business you does been this specifically talk just runs that could So inside that about if is think things this comment day-to-day basis. and ramping you've and of the the wondering on and you And I we're bit land that this more. on your that while. testing Todd, a are direction RFID I this you for kind plants. to way little like of the it get I that maybe heading your know a a long I promised thought maybe where where to

a related guess to question sortation. I similar the auto

like if roughly. sort I of that just new technologies any your guys make business deploy you so you I talked on think auto that that, wondering in can it the widely. more was that like have past, half cheaper there's developments you it

have in considerations a things sortation? can of Any factor. allow So been rollout X like the particular. you I to limiting in those that have Sometimes just plant you developed your talk auto was about broaden space technologies hoping your been that

Andy. Certainly. Thank you,

our to back go let's think culture. I

We have of call spirit -- this positive this discontent. we

our It has be. since it I'm DNA. will sure the and part and it's I've -- always that is -- innovating. always been of It's we So company, in joined constantly are just

services partners business to provide ways trying partners to customers for to find do always us. and are our employee easier and it to -- we our our to to for products So our with -- services make easier customers

our using areas we our us, hopefully, And it's important innovate. to to been business whether business, you for future that continuing broadly is controlling mentioned, So of RFID, that. customers. certain years a in in and RFID inventory we've we're can And have test more our in to many there's important where

in So facilities. sortation we're facilities, Similar will that and auto in area, in our innovating continue. rental with that our always

And innovating. we see we're there. So opportunities

We technologies some out there have our in extract in to business. that those leverage -- allows invested that proprietary broadly more us technology to inefficiencies

be that path. to we're but certain on we've with invested take all sortation, in and that at So that time. say, forward. footprint technologies it, make there's We're constantly can auto bullish you're "Well, we a And better sure we'll issue right, moving with got we be tweaking look and continue to an Those way." nail things and

Appreciate maybe I some that's you innovation of maybe thought line those to your I'd the ask perspectives. top about relevant business. financials

markets. You've so education. I getting It's up you about? the about care, could been developing more are much while new to about trying guys a for always end trodden maybe open health some well thing markets of talked maybe But now. government, a And excited thought end you that talk you're

that market can of comparison services for home and size play residential talked you in the around is an you if things to growth about in that some the the that of -- Are opportunity markets you? these can you've And about other there just past? talk

question, Thanks for Andy. the

an us. high It's our So where a home has about focus. best we're been an different discontent not looking in our always business, a That's area very and services of or for vertical. they of that of products and list. positive area but investment flows through is investment see been vertical, prepared particular of speak we area on have that I'm not business. residential not next to significant services, spirit anything not our every an needs Certainly, the for for

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

might quarter. question that there out growth on. that was growth, but know of touching call I over to I verticals a or to standout think want really here back want were particular broad-based there's I George to clients get terms in you types during of the

Shlomo, level. totality at functioning is very would in say business I that a our good

besides local no investments and made particular and we'll vertical the in care, governments. to. to there state call continue hospitality, So We've education we've investing and been out health

there's the you with the America they've areas, investment health been at North -- there, that particularly that but care those shocking of how jobs If we continued all demographics not look why we reports in vertical. those there, good businesses see a -- then to focus than they expect better we good really grow and if on average weren't, have them runway would still see in do we

mentioned call So so what just nothing I out yes, there. besides specific to

is Okay. this just And a for housekeeping item Mike.

press what's cash the to the about in like million, can statement, stock, and in what's go the $XXX about cash it statement, says million just what flow you looks difference $XXX between is talk the Just flow release I commentary? the repurchased on you've

shares. cash impact approved Yes, reflects commentary reflects plus of The the flow the the that Board stock and authorization. exercises restricted buyback option

employee we So partners, the exercise, are when cetera. are some have or withheld in of stock for that option. purchased taxes, the netting exercise words, There other et that effectively shares, for shares a

shares that we vest, same are difference. restricted taxes. That's withholding for For thing, the shares

Ashish question our RBC. comes Sabadra And from next from

I headwind. were the just really XX% in XX% follow on quarter. that's incremental despite expansion margin working to margins XX%, to margin of the and The midterm above front, wanted solid up day one fewer your guidance

the we So the go expansion year? different how for through the margins should you of think drivers, the laid about incremental as rest year, but we margin obviously, out multiple

range, Ashish, we isn't wholly linear. our that's to gave XX% business and target where the XX% is. The

quarters little XX be speaking, a a in lower that we'll there more. this in periods days be about Generally year, got of think we There the so quarters we'll we've remaining. bit -- and are are invest where in little our some work there each though, so are And range, some we bit range. higher as where

the And a end, way that range, way of bit end. not to variability lower we'll some into we'll so the will that's some through the expect run the go I the that that's -- But going there. it we the be the within higher little future. quarters move as at there's at -- days work because That's of

sort in investments. news so and that move Generally out and though, even talked Todd will range. year. margin Sigma that And the range, our and is range. initiatives we -- projects -- expectation is us that Six many speaking, can the good be that be for about will improvement And that these means just in through of of sometimes really

question on quick earlier just maybe And color. follow-up M&A. just follow great up M&A. wanted That's I a to an on on

for potentially appetite M&A and pipeline a M&A deal your large well. about talk can as you If

Ashish, thanks for the question.

it M&A our shareholders, And entire First off, shown across of strategy, deals various and customers, and open of our really platform. for well has involved. shapes part important the to for work an again, business, we're can all sizes we've been

Vestis been speaking courted a challenges of company. because acquisition, [ by has with historically been would If That in ] public uninvested asset. you're international particular, being what pose particular it's

hard sellers M&A to In it's very general when it and to general, it us M&A, transact, to more categories, generate predict a very one. to much the for expect particular attractive. think would basis. in It's important it M&A to of level in but in again, us, of make ready value So and really in we're from dance those We're two interested that it's in on are takes area hard we we the business. that

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

really, about seeing teens what I revenue in wanted to accelerate talk we're can about business our the drivers here. And don't think if potential because business. I I'm Aid of is growth there. long-term opportunity or about sustainability curious First talk business. growth expectation of talk in you organic a that can And about we type know you should that for TAM if the how the

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So business, how our for and been of positive changed regard things their think we people the to meaning at the that health of business. a and certain people that's and they wellness with their facilities, some pandemic degree, look to

of aid that And whether people for cabinet, potable WaterBreak where it's providing certainly, that them. the a water in case -- cardiac various AEDs So stations our for eye sudden that provides wellness. and dimensions are accessible it for -- makes health first in for arrest, wash our it

have really those all So been attractive.

but good, during really probably of -- pandemic, it focused. So is back PPE the more was meaning the mix business

has that been the of So business changed, mix but very that attractive. demand has

that And technology. a training compliance partners We've in and to great our mention people, stay invested customers. have helps of customers business, invest to we've really provide invested whether So which customers. in -- we all they it's things there. aid have, and significantly in value aid the CPR compliance nice various care certainly, invested forklift we needs I training first We've to the our think training, are in with we can training, first more general take neglected sales service more

you running different customers revenue uniform new that. and of in or businesses you're finding of Safety of curious, separately of business? a certainly, like uniform this things percentage with that new like whole the there's sort First the But terms you are I existing it trucks I'm that And what type there's synergies have business Is in you're customers? attracting? that know Aid customers that

And I question. Faiza, that do specific customers really data with you, of are opportunities. good separate We this we toward have have those can share help we employee customers, that they we have but has have visiting have business say that us. this. those they specific partners they're infrastructure within share they don't solutions customers. mentioned, organized and to found and customers, I'll been that ears, provide trucks those minds, they having But around those I our number eyes, for focus and customers, beneficial a for when and in We run as data. that

longest. sometimes with mix. have "Hey, So of -- there's the a the ask this," a been it's it were because I fire, we may to need time first for sheer have enough rental do aid, customers rental, first business it's or cross-selling of nice the a it in makes sometimes easy -- we There's us, you through through opportunity say, might just through certainly for some very so that well, the noticed we've business they scale it's

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And Moore Jefferies. our Stephanie from from next comes question

wanted environment I on the competitive market. maybe your vendor within to touch

aggressively stepped-up maybe maybe would Any from competitive going customers, If in a little after anything in pricing terms standpoint? color activity a of challenging activity existing on you're seeing form the there be of the great. bit competitive

started I'm really environment. the a since with competitive sure the company been I it's it in We will and XXXX, And operate competitive future. in be for competitive

that of customers out business. that over at as today. approach we or one We the buy X space opportunity. how amazing. businesses. today is white incredible service The XX an look see they million And where million little is help We differences we the there no-program opportunity and So a market the we them can can

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of of just but kind on. there's And ago, clearly, consolidation questions couple you activity going touched follow-up, actually a potential a then Great. as on some this industry

that consolidated see that? think the think your you activity thoughts would you continue impact environment in As more that, competitive a about to of consolidate, and likes were how your do you on industry to if

question. Good Yes.

we with to very never competition, and at pay certainly attention So deal that they that. underestimate we are competitors what good our We do.

swivel on our But people we're our We customers. have our care So our we for head focused to have take to impact? investing that customers industry best the dynamic don't in and think our a provide making to best sure position solutions of business so. consolidation, would that we on and always a are

landscape. spending So investing the and that's we our to close very competitive we're where but attention focusing, time pay

might competitors. against nontraditional Keeping what mind in that day we call we compete every

different direct So competing providing Amazon, are we're Walmart, all competition. kinds against uniforms who of those sale

is consolidation to for competitive. industry will continue So us. necessarily bad be thing a not It

agree, Completely Yes. Mike.

getting and nontraditional we in growing mentioned, But the I as cheaper very They that's into our for do business. provide. it many we we the prospect competitor. we've or products similar better, in be faster, As not can may business. services the smarter, walk a it a cases, and something cases of think from we got many successful where with in They're they've customer, been can sources, those what

guess I take basically said quick it's been And that just one I mean to always competitive. point. you

competitive player you more environment? had they you maybe it consolidation, being more greater would be new another North would think do Do that's think even to If less -- end with a you America? up actually or

again, more great to competitor basis. international delivering imagine don't value even remain to focus if our competitive. really would enter, competitive today, our It's daily dynamic see And customers we on to a were being changing. the any hard competitive It's Yes. but on

Scott comes Schneeberger Our question from next Oppenheimer. from

two. I ask upfront we're them getting since I'll here. have both late

visibility? Direct trend business very you quarters First you Sales, this I see I we decline, might know And the what of the one, X the please strong. prior, Uniform they the lumpy organic persisted over could elaborate on year, have for, to is balance years extent is now. and, think, the But there guys a

the appears CapEx then quarter. the is, on And second in question really pace. free cash first flow, strong

you 'XX. like Or the year strong anticipate cash issue? driven. it? looks Could discuss it fiscal a a something in capital Was we timing should working was So this strength particularly

And a you business. the little couple talk Rollouts Scott, those lumpy sale nailed back impactful. a bit question. incredible regarding business. Scott, flow. direct nailed you the national like that customers highly I'll if had the of to growth And types national it they it. respond of cash thanks years. you accounts, about of are for also Mike, going It's a

really like a in timing like feel future. business. So that good in we're and We where real more change we're for positioned spot just lumpiness. No the

Yes.

really strong. right, cash was you're flow, flow Scott. Free cash Regarding

For of is us, timing. some that

working see off from payable a with benefit accounts benefit you paying cash extend accrued a compensation hard that's related accounts nice little in in in flow. bit and been we payable, got example, liabilities, working a real nice that's for terms, From capital We've some more change So accounts payable. to the an timing. some

at year, generally in it be though, range. speaking, look the For we the to typical

rest the cash for for where free in the sort we where typically conversion XX% of year net in that's XXX% the of which full be expect to So to income the we year is been, have of flow total. or range,

And Jason Wells Fargo. Haas our question next comes from from

from what I'm reception your customers? the this year. in level you're curious putting then curious like if what of you us price And been I'm could remind has increases

people closer of but is price our lower grow growth, business, on adjustments it and my that on they're position how been can inflation, and but are those go component, price our price of challenging basis are back the Jason, it's daily they adjustments. conversations today a challenging, historical a how entire and to try adjustments always way our and our component so on were our career at it's to much best a received, we're better, the where are challenging and peak not they're they we always certainly provide focused service than to

time we how focus products can how to how and our the provide So best them position try the on to our they them to we most just so value. to train best -- that give and people, services

I people. hiring hire was And sense. your a about segue own good it's for to the gotten I'm it's makes question. easier it. Got if harder the curious market or That any to and next curious business,

easier, challenge right? it's certainly has been that's and market, a find The but what focused eased. craziness, on. hiring Similar we're meaning, Yes, people. great always There's I to call question. good pandemic it's it Jason, never doubt no similar, easy. it but from

the we're what because we're business. future. ahead. And that's that the seeing We're the is in we for opportunities see still investing reason lie investing our So

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

for us Thank you, joining everyone, morning. this

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

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

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