What changed in this filing

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Item 1A. Risk Factors

2022-07-27 compared with 2021-07-28 · 37 added, 19 removed, 159 unchanged (26% of the section changed)

1 unchanged sentence

Although the risks are organized by headings, and each risk is discussed separately, many are interrelated.

Readers should not interpret the disclosure of any risk factor to imply that the risk has not already materialized.

In addition, this section sets forth statements which constitute our cautionary statements under the Private Securities Litigation Reform Act of 1995.

11 unchanged sentences

fluctuations in costs of materials and labor, including increased medical costs;

interest rate volatility;

costs and possible effects of union organizing activities;

2 unchanged sentences

uncertainties regarding any existing or newly-discovered expenses and liabilities related to environmental compliance and remediation;

our ability to meet our goals relating to ESG opportunities, improvements and efficiencies;

the cost, results and ongoing assessment of internal controls for financial reporting;

3 unchanged sentences

higher assumed sourcing or distribution costs of products;

the disruption of operations from catastrophic or extraordinary events including viral pandemics such as the COVID-19 coronavirus;

the disruption of operations from catastrophic or extraordinary events including global health pandemics such as the COVID-19 coronavirus;

the amount and timing of repurchases of our common stock, if any;

4 unchanged sentences

Additional risks and uncertainties presently not known to us or that we currently believe to be immaterial may also harm our business.

Investors should not interpret the disclosure of any risk factor to imply that the risk has not already materialized.

Risks Relating to Business Strategy & Operations

Negative global economic factors, including the COVID-19 pandemic, may adversely affect our financial performance.

Risks Relating to Business Strategy and Operations

Negative global economic factors, including global health pandemics such as the COVID-19 pandemic, may adversely affect our financial performance.

Negative economic conditions, in North America and our other markets, may adversely affect our financial performance.

Higher levels of unemployment, inflation, tax rates and other changes in tax laws and other economic factors could adversely affect the demand for Cintas’ products and services.

Higher levels of unemployment, inflation, recessionary conditions, geopolitical developments, tax rates and other changes in tax laws and other economic factors could adversely affect the demand for Cintas’ products and services.

Increases in labor costs, including the cost to provide employee-partner related healthcare benefits, minimum wages, labor shortages or shortages of skilled labor, regulations regarding the classification of employees and/or their eligibility for overtime wages, higher material costs for items such as fabrics and textiles, the inability to obtain insurance coverage at cost-effective rates, higher interest rates, inflation, higher tax rates and other changes in tax laws and other economic factors could increase our costs of rental uniforms and facility services, cost of other services and selling and administrative expenses.

1 unchanged sentence

The COVID-19 pandemic has created widespread disruption in the global economy and has had, and could continue to have, an adverse impact on our consolidated results of operations and financial performance, as well as on the results of operations and financial performance of many of the customers and suppliers in industries that we serve and operate.

The duration of the pandemic itself and the market and workplace disruptions it has caused, including disruptions imposed by federal, state and local actions, as well as the potential for new government

regulations, and the long-term effects on the economy and our customers are uncertain and as yet unknowable.

These factors, as they become more certain, could adversely affect our workforce, sales and overall business.

Furthermore, the ultimate impact of the COVID-19 pandemic on our consolidated results of operations and financial performance depends on many factors that are not within our control, including, but not limited to:

governmental, business and individuals’ actions that have been and continue to be taken in response to the pandemic;

the impact of the pandemic and actions taken in response on global and regional economies;

the availability of federal, state or local funding programs;

The duration of the pandemic itself and the market and workplace disruptions it has caused, as well as the long-term effects on the economy and our customers are uncertain and as yet unknowable.

factors, as they become more certain, could adversely affect our workforce, sales and overall business.

Furthermore, the ultimate impact of global health pandemics such as the COVID-19 pandemic on our consolidated results of operations and financial performance depends on many factors that are not within our control, including, but not limited to:

the impact of global health pandemics on global and regional economies, including the impact of governmental, business and individuals’ actions taken in response to such pandemics;

the availability of federal, state or local pandemic relief programs;

general economic uncertainty in key financial markets and financial market volatility;

global economic conditions and levels of economic growth;

and the pace of recovery when the COVID-19 pandemic subsides.

We are unable to predict the extent to which the pandemic and related impacts will continue to adversely impact our business operations, financial performance, consolidated results of operations, consolidated financial position and the achievement of our strategic objectives.

and the pace of recovery when the global health pandemic subsides.

We are unable to predict the extent to which global health pandemics such as the COVID-19 pandemic and related impacts will continue to adversely impact our business operations, financial performance, consolidated results of operations, consolidated financial position and the achievement of our strategic objectives.

Increased competition could adversely affect our financial performance.

28 unchanged sentences

trade sanctions imposed on certain countries, the limitation on the importation of certain types of goods or of goods containing certain materials from other countries and other factors relating to foreign trade are beyond our control.

These and other factors, including the potential negative impact of viral pandemics such as COVID-19 affecting our suppliers and our access to products could adversely affect our consolidated results of operations.

These and other factors, including the potential negative impact of global health pandemics such as COVID-19 affecting our suppliers and our access to products could adversely affect our consolidated results of operations.

We rely extensively on computer systems, including third-party systems, to process transactions, maintain information and manage our businesses.

22 unchanged sentences

Our corporate culture, along with our entire operation, depends on our ability to attract, develop and retain key employees.

Competitive pressures within and outside our industry may make it more difficult and expensive for us to attract and retain key employees which could adversely affect our businesses.

Competitive pressures and labor shortages within and outside our industry may make it more difficult and expensive for us to attract and retain key employees which could adversely affect our businesses.

We believe we have positive labor relationships with our employees.

2 unchanged sentences

Unexpected events could negatively impact our operations and adversely affect our consolidated results of operations.

Unexpected events, including fires or explosions at facilities, severe weather conditions, natural disasters such as hurricanes and tornadoes, war or terrorist activities, unplanned outages, viral pandemics such as COVID-19, supply disruptions, failure of equipment or systems or changes in laws and/or regulations impacting our businesses, could adversely affect our consolidated results of operations.

Unexpected events, including fires or explosions at facilities, severe weather conditions and natural disasters such as hurricanes and tornadoes (including those caused by climate change), war or terrorist activities, unplanned outages, global health pandemics such as COVID-19, supply disruptions, failure of equipment or systems or changes in laws and/or regulations impacting our businesses, could adversely affect our consolidated results of operations.

These events could result in customer disruption, physical damage to one or more key operating facilities, the temporary closure of one or more key operating facilities or the temporary disruption of information systems.

5 unchanged sentences

Changes in the fuel and energy industry could adversely affect our consolidated financial condition and consolidated results of operations.

The price of fuel and energy needed to run our vehicles and equipment is unpredictable and fluctuates based on events outside our control, including geopolitical developments, supply and demand for fuel and other energy related products, actions by energy producers, war and unrest in oil producing countries, regional production patterns, limits on refining capacities, natural disasters, environmental concerns and viral pandemics such as COVID-19.

Increases in fuel and energy costs could adversely affect our consolidated financial condition and consolidated results of operations.

50 unchanged sentences

While we regularly engage in environmental due diligence in connection with acquisitions, we can give no assurance that locations that have been acquired or leased have been operated in compliance with environmental laws and regulations during prior periods or that future uses or conditions will not make us liable under these laws or expose us to third-party actions, including tort suits.

Increased global focus on climate change may result in the imposition of new or additional regulations or requirements applicable to, and increased financial risks for, our business and industry.

A number of government authorities and agencies have introduced or are contemplating regulatory changes to address climate change, including the regulation of GHG emissions.

The outcome of new legislation or regulation in the U.S.

and other jurisdictions in which we operate may result in new or additional requirements, including to fund energy efficiency activities or renewable energy use, and fees or restrictions on certain activities or materials.

Compliance with these climate change initiatives may also result in additional costs to us, including, among other things, increased production costs, additional taxes, additional investments in renewable energy use and other initiatives, reduced emission allowances or additional restrictions on production or operations.

We may not be able to timely recover the cost of compliance with such new or more stringent laws and regulations, which could adversely affect our consolidated results of operations.

Our ability to achieve our environmental, social and governance goals are subject to risks, many of which are outside of our control, and our reputation and brands could be harmed if we fail to meet such goals.

Companies across all industries are facing increasing scrutiny from stakeholders related to ESG matters, including practices and disclosures related to environmental stewardship;

social responsibility;

diversity, equity and inclusion;

and workplace rights.

Our ability to achieve our ESG goals, including our goal to achieve Net Zero GHG emissions by 2050, and to accurately and transparently report our progress presents numerous operational, financial, legal and other risks, and may be dependent on the actions of suppliers and other third parties, all of which are outside of our control.

If we are unable to meet our ESG goals or evolving stakeholder expectations and industry standards, or if we are perceived to have not responded appropriately to the growing concern for ESG issues, our reputation could be negatively impacted.

In addition, in recent years, investor advocacy groups and certain institutional investors have placed increasing importance on ESG matters.

If, as a result of their assessment of our ESG practices, certain investors are unsatisfied with our actions or progress, they may reconsider their investment in our Company.

As the nature, scope and complexity of ESG reporting, diligence and disclosure requirements expand, including the SEC’s recently proposed disclosure requirements regarding, among other matters, GHG emissions, we may have to undertake additional costs to control, assess and report on ESG metrics.

Any failure or perceived failure, whether or not valid, to pursue or fulfill our ESG goals, targets and objectives or to satisfy various ESG reporting standards within the timelines we announce, or at all, could increase the risk of litigation.

Increases in income tax rates, changes in income tax laws or unfavorable resolution of tax matters could adversely impact our financial results.

2 unchanged sentences

and other jurisdictions and our tax positions may be challenged by tax authorities.

Although we believe that our current tax provisions are reasonable and appropriate, there can be no assurance that these items will be settled for the amounts accrued, that additional tax exposures will not be identified in the future or that additional tax reserves will not be necessary for any such exposures.

Although we believe that our current tax provisions are reasonable and appropriate, there can be no assurance that these items will be settled for the amounts accrued,

that additional tax exposures will not be identified in the future or that additional tax reserves will not be necessary for any such exposures.

Any increase in the amount of taxation incurred as a result of challenges to our tax filing positions could result in a material adverse effect on our business, consolidated results of operations and consolidated financial condition.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors