What changed in this filing

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Item 1. Financial Statements

2024-01-08 compared with 2023-10-05 · 175 added, 71 removed, 429 unchanged (36% of the section changed)

2 unchanged sentences

CONSOLIDATED CONDENSED STATEMENTS OF INCOME

Three Months Ended

(In thousands except per share data) August 31, 2023 August 31, 2022

Three Months Ended Six Months Ended

(In thousands except per share data) November 30, 2023 November 30, 2022 November 30, 2023 November 30, 2022

Uniform rental and facility services $ 1,850,542 $ 1,709,987 $ 3,677,367 $ 3,407,759

18 unchanged sentences

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended

(In thousands) August 31,

2023 August 31,

Three Months Ended Six Months Ended

(In thousands) November 30,

2023 November 30,

2022 November 30,

2023 November 30,

Net income $ 374,613 $ 324,293 $ 759,698 $ 675,982

Other comprehensive income (loss), net of tax:

Other comprehensive (loss) income, net of tax:

Foreign currency translation adjustments

( 1,813 ) ( 9,901 ) 821 ( 29,107 )

Change in fair value of interest rate lock agreements, net of tax

expense of $ 2,806 and $ 320 , respectively

Amortization of interest rate lock agreements, net of tax benefit of

$( 487 ) and $( 512 ), respectively

Change in fair value of interest rate lock

agreements, net of tax expense of

$ 3,115 , $ 2,531 , $ 5,921 and $ 2,851 ,

9,099 7,394 17,298 8,328

Other comprehensive income (loss), net of tax expense (benefit) of

Amortization of interest rate lock

agreements, net of tax benefit of

$( 503 ), $( 513 ), $( 990 ) and $( 1,025 ),

( 1,495 ) ( 1,521 ) ( 2,937 ) ( 3,042 )

Other, net of tax expense of $ 130 , $ 0 ,

$ 130 and $ 0 , respectively

Other comprehensive income (loss), net

of tax expense of $ 2,742 , $ 2,018 ,

$ 5,061 and $ 1,826 , respectively

6,170 ( 4,028 ) 15,561 ( 23,821 )

3 unchanged sentences

CONSOLIDATED CONDENSED BALANCE SHEETS

(In thousands except per share data) August 31,

(In thousands except per share data) November 30,

Current assets:

19 unchanged sentences

Operating lease liabilities, current 44,063 43,710

Debt due within one year 210,000 —

Total current liabilities 1,357,602 1,230,062

39 unchanged sentences

Balance at August 31, 2023 192,658 $ 2,121,475 $ 9,844,128 $ 87,169 ( 90,730 ) $ ( 7,975,137 ) $ 4,077,635

Net income — — 374,613 — — — 374,613

Comprehensive income, net of tax — — — 6,170 — — 6,170

Dividends — — ( 137,474 ) — — — ( 137,474 )

Stock-based compensation — 22,940 — — — — 22,940

Vesting of stock-based compensation awards 3 — — — — — —

Stock options exercised 200 35,536 — — ( 68 ) ( 35,087 ) 449

Repurchase of common stock — — — — ( 716 ) ( 349,852 ) ( 349,852 )

Balance at November 30, 2023 192,861 $ 2,179,951 $ 10,081,267 $ 93,339 ( 91,514 ) $ ( 8,360,076 ) $ 3,994,481

CINTAS CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF SHAREHOLDERS' EQUITY

and Paid-In Capital Retained

13 unchanged sentences

Balance at August 31, 2022 191,654 $ 1,878,837 $ 8,953,391 $ 88,124 ( 90,122 ) $ ( 7,690,726 ) $ 3,229,626

Net income — — 324,293 — — — 324,293

Comprehensive loss, net of tax — — — ( 4,028 ) — — ( 4,028 )

Dividends — — ( 117,338 ) — — — ( 117,338 )

Stock-based compensation — 25,255 — — — — 25,255

Vesting of stock-based compensation awards 9 — — — — — —

Stock options exercised 194 29,053 — — ( 66 ) ( 27,975 ) 1,078

Repurchase of common stock — — — — ( 68 ) ( 28,348 ) ( 28,348 )

Balance at November 30, 2022 191,857 $ 1,933,145 $ 9,160,346 $ 84,096 ( 90,256 ) $ ( 7,747,049 ) $ 3,430,538

See accompanying notes.

1 unchanged sentence

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

Three Months Ended

(In thousands) August 31, 2023 August 31, 2022

Six Months Ended

(In thousands) November 30, 2023 November 30, 2022

Cash flows from operating activities:

47 unchanged sentences

Inventory is comprised of the following at:

(In thousands) August 31,

(In thousands) November 30,

Raw materials $ 19,283 $ 27,878

2 unchanged sentences

Inventories, net $ 474,840 $ 506,604

Inventories are recorded net of reserves for obsolete inventory (excess and slow-moving) of $ 74.1 million and $ 80.1 million at August 31, 2023 and May 31, 2023, respectively.

Inventories are recorded net of reserves for obsolete inventory (excess and slow-moving) of $ 73.6 million and $ 80.1 million at November 30, 2023 and May 31, 2023, respectively.

The inventory obsolescence reserve is determined by specific identification, as well as an estimate based on Cintas' historical rates of obsolescence.

3 unchanged sentences

Note 2 - Revenue Recognition

The following table presents Cintas' total revenue disaggregated by operating segment for the three months ended August 31:

(In thousands) 2023 2022

Uniform Rental and Facility Services $ 1,826,825 78.0 % $ 1,697,772 78.4 %

First Aid and Safety Services 260,693 11.1 % 234,161 10.8 %

Fire Protection Services 174,316 7.5 % 151,847 7.0 %

Uniform Direct Sales 80,496 3.4 % 82,674 3.8 %

The following table presents Cintas' total revenue disaggregated by operating segment:

Three Months Ended Six Months Ended

(In thousands) November 30,

2023 November 30,

2022 November 30,

2023 November 30,

Uniform Rental and

Facility Services $ 1,850,542 77.9 % $ 1,709,987 78.6 % $ 3,677,367 77.9 % $ 3,407,759 78.5 %

First Aid and Safety

Services 266,401 11.2 % 235,974 10.9 % 527,094 11.2 % 470,135 10.8 %

Fire Protection

Services 173,950 7.3 % 146,602 6.7 % 348,266 7.4 % 298,449 6.9 %

Uniform Direct

Sales 86,284 3.6 % 82,295 3.8 % 166,780 3.5 % 164,969 3.8 %

Total revenue $ 2,377,177 100.0 % $ 2,174,858 100.0 % $ 4,719,507 100.0 % $ 4,341,312 100.0 %

13 unchanged sentences

The Company's performance period generally corresponds with the monthly invoice period.

No constraints on our revenue recognition were applied during the three months ended August 31, 2023 or 2022.

No constraints on our revenue recognition were applied during the three or six months ended November 30, 2023 or 2022.

We are exposed to credit losses primarily through our trade receivables.

1 unchanged sentence

The portion of the allowance for credit losses that is an estimate based on Cintas' historical rates of collections is recorded for overdue amounts, beginning with a nominal percentage when the account is current and increasing substantially as the account ages.

The amount provided as the account ages will differ slightly between the Uniform Rental and Facility Services reportable operating segment, the First Aid and Safety Services reportable operating segment and All Other because of differences in customers served and the nature of each business.

We update our allowance for credit losses quarterly, considering recent write-offs and collections information and underlying economic expectations.

We update our allowance for credit losses quarterly, considering recent write-offs and collections information and underlying economic conditions and expectations.

Costs to Obtain a Contract

1 unchanged sentence

As permitted by Accounting Standards Codification 606, Revenue from Contracts with Customers (ASC 606), the Company has elected to apply the guidance to a portfolio of contracts (or performance obligations) with similar characteristics because the Company reasonably expects that the effects on the consolidated condensed financial statements of applying this guidance to the portfolio would not differ materially from applying this guidance to the individual contracts within the portfolio.

The Company also continues to expense certain costs to obtain a contract if those costs do not meet the criteria of the standard or the amortization period of the asset would have been one year or less.

The Company also continues to expense certain costs to obtain a contract if those costs do not meet the criteria of ASC 606 or the amortization period of the asset would have been one year or less.

The deferred commissions are amortized on a straight-line basis over the expected period of benefit.

2 unchanged sentences

The current portion is included in prepaid expenses and other current assets and the noncurrent portion is included in other assets, net on the Company's consolidated condensed balance sheets.

As of August 31, 2023, the current and noncurrent assets related to deferred commissions totaled $ 94.1 million and $ 255.1 million, respectively.

As of November 30, 2023, the current and noncurrent assets related to deferred commissions totaled $ 93.9 million and $ 258.6 million, respectively.

As of May 31, 2023, the current and noncurrent assets related to deferred commissions totaled $ 92.5 million and $ 251.6 million, respectively.

We recorded amortization expense related to deferred commissions of $ 24.4 million and $ 22.4 million during the three months ended August 31, 2023 and 2022, respectively.

We recorded amortization expense related to deferred commissions of $ 25.2 million and $ 23.4 million during the three months ended November 30, 2023 and 2022, respectively.

During the six months ended November 30, 2023 and 2022, we recorded amortization expense related to deferred commissions of $ 49.6 million and $ 45.8 million, respectively.

These expenses are classified in selling and administrative expenses on the consolidated condensed statements of income.

9 unchanged sentences

The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Operating lease costs, including short-term lease expense and variable lease costs which were immaterial in both periods, were $ 19.7 million and $ 19.5 million for the three months ended August 31, 2023 and 2022, respectively.

The following table provides supplemental information related to the Company's consolidated condensed statements of cash flows for the three months ended August 31:

Operating lease costs, including short-term lease expense and variable lease costs which were immaterial in both periods, were $ 20.8 million and $ 20.0 million for the three months ended November 30, 2023 and 2022, respectively.

For the six months ended November 30, 2023 and 2022, operating lease costs, including short-term lease expense and variable lease costs which were immaterial in both periods, were $ 40.5 million and $ 39.5 million, respectively.

The following table provides supplemental information related to the Company's consolidated condensed statements of cash flows for the six months ended November 30:

(In thousands) 2023 2022

2 unchanged sentences

operating lease liabilities $ 22,684 $ 29,186

Operating lease right-of-use assets acquired in business combinations $ 267 $ —

Other information related to the operating lease right-of-use assets, net and operating lease liabilities was as follows:

1 unchanged sentence

Weighted-average discount rate 3.14 % 2.87 %

The contractual future minimum lease payments of Cintas' operating lease liabilities by fiscal year are as follows as of August 31, 2023:

The contractual future minimum lease payments of Cintas' operating lease liabilities by fiscal year are as follows as of November 30, 2023:

(In thousands)

2024 (remaining nine months)

2024 (remaining six months)

Thereafter 38,400

5 unchanged sentences

These financial instruments measured at fair value on a recurring basis are summarized below:

As of August 31, 2023 As of May 31, 2023

As of November 30, 2023 As of May 31, 2023

(In thousands) Level 1 Level 2 Level 3 Fair Value Level 1 Level 2 Level 3 Fair Value

7 unchanged sentences

Financial instruments classified as Level 1 are based on quoted market prices in active markets, and financial instruments classified as Level 2 are based on quoted market prices, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency.

The types of financial instruments Cintas classifies within Level 1 include most bank deposits and money market securities.

The types of financial instruments Cintas classifies

within Level 1 include most bank deposits and money market securities.

Cintas does not adjust the quoted market price for such financial instruments.

8 unchanged sentences

Cintas uses the two-class method to calculate basic and diluted earnings per share as a result of outstanding participating securities in the form of restricted stock awards.

The following tables set forth the computation of basic and diluted earnings per share using the two-class method for amounts attributable to Cintas’ common shares for the three months ended August 31:

The following tables set forth the computation of basic and diluted earnings per share using the two-class method for amounts attributable to Cintas’ common shares:

Three Months Ended Six Months Ended

Basic Earnings per Share

(In thousands except per share data)

November 30, 2023 November 30, 2022 November 30, 2023 November 30, 2022

Net income $ 374,613 $ 324,293 $ 759,698 $ 675,982

4 unchanged sentences

Basic earnings per share $ 3.67 $ 3.18 $ 7.43 $ 6.63

Three Months Ended Six Months Ended

Diluted Earnings per Share

(In thousands except per share data)

November 30, 2023 November 30, 2022 November 30, 2023 November 30, 2022

Net income $ 374,613 $ 324,293 $ 759,698 $ 675,982

4 unchanged sentences

Effect of dilutive securities – employee stock options

1,599 1,719 1,637 1,813

Diluted weighted average common shares outstanding

1 unchanged sentence

Diluted earnings per share $ 3.61 $ 3.12 $ 7.32 $ 6.51

For the three months ended August 31, 2023 and 2022, options granted to purchase 0.2 million and 0.8 million shares of Cintas common stock, respectively, were excluded from the computation of diluted earnings per share.

For the three months ended November 30, 2023 and 2022, options granted to purchase 0.5 million and 1.1 million shares of Cintas common stock, respectively, were excluded from the computation of diluted earnings per share.

For the six months ended November 30, 2023 and 2022, options granted to purchase 0.3 million and 0.9 million shares of Cintas common stock, respectively, were excluded from the computation of diluted earnings per share.

The exercise prices of these options were greater than the average market price of the common stock (anti-dilutive).

1 unchanged sentence

On July 26, 2022, Cintas announced that the Board of Directors authorized a new $ 1.0 billion share buyback program, which does not have an expiration date.

The following table summarizes the share buyback activity by program and period for the three months ended August 31:

The following table summarizes the share buyback activity by program and period:

Three Months Ended Six Months Ended

November 30, 2023 November 30, 2023

Buyback Activity

9 unchanged sentences

Total repurchase of Cintas common stock $ 349,852 $ 423,128

Three Months Ended Six Months Ended

November 30, 2022 November 30, 2022

Buyback Activity

(In thousands except per share data)

per Share Purchase

Price Shares Avg.

per Share Purchase

July 27, 2021 12 $ 377.66 $ 4,683 544 $ 395.97 $ 215,434

July 26, 2022 — — — — — —

12 $ 377.66 $ 4,683 544 $ 395.97 $ 215,434

Shares acquired for taxes due (1)

56 $ 423.64 $ 23,665 326 $ 408.97 $ 133,248

Total repurchase of Cintas common stock $ 28,348 $ 348,682

(1) Shares of Cintas common stock acquired for employee payroll taxes due on options exercised and vested restricted stock awards.

In addition to the share buyback activity presented above, Cintas acquired shares of Cintas common stock, via non-cash transactions, in connection with net-share settlements of option exercises.

The following table summarizes Cintas' non-cash share buyback activity for the three months ended August 31:

The following table summarizes Cintas' non-cash share buyback activity:

Three Months Ended Six Months Ended

November 30, 2023 November 30, 2023

(In thousands except per share data)

3 unchanged sentences

Non-cash transaction activity 68 $ 514.75 $ 35,087 186 $ 506.82 $ 94,300

In the period subsequent to August 31, 2023, through October 5, 2023, we purchased 0.5 million shares of Cintas common stock at an average price of $ 482.59 for a total purchase price of $ 225.5 million.

From the inception of the July 27, 2021 program through October 5, 2023, Cintas has purchased 3.2 million shares of Cintas common stock in the aggregate, at an average price of $ 400.08 per share, for a total purchase price of $ 1.3 billion.

Cintas has made no purchases under the July 26, 2022 share buyback program.

Three Months Ended Six Months Ended

November 30, 2022 November 30, 2022

per Share Non-Cash

Value Shares Avg.

per Share Non-Cash

Non-cash transaction activity 66 $ 421.85 $ 27,975 260 $ 414.46 $ 107,566

Note 6 - Goodwill, Service Contracts and Other Assets, Net

Changes in the carrying amount of goodwill and service contracts for the three months ended August 31, 2023, by reportable operating segment and All Other, are as follows:

Changes in the carrying amount of goodwill and service contracts for the six months ended November 30, 2023, by reportable operating segment and All Other, are as follows:

(In thousands)

5 unchanged sentences

Foreign currency translation 224 20 1 245

Balance as of August 31, 2023 $ 2,683,126 $ 293,984 $ 127,845 $ 3,104,955

Balance as of November 30, 2023 $ 2,686,568 $ 293,850 $ 140,088 $ 3,120,506

Service Contracts

7 unchanged sentences

Foreign currency translation 86 9 — 95

Balance as of August 31, 2023 $ 305,181 $ 20,146 $ 14,939 $ 340,266

Balance as of November 30, 2023 $ 295,645 $ 18,829 $ 15,037 $ 329,511

Information regarding Cintas’ service contracts and other assets, net is as follows:

As of August 31, 2023 As of May 31, 2023

As of November 30, 2023 As of May 31, 2023

(In thousands) Carrying

10 unchanged sentences

Total other assets, net $ 946,410 $ 532,283 $ 414,127 $ 863,965 $ 480,974 $ 382,991

(1) The current portion of capitalized contract costs, included in prepaid expenses and other current assets on the consolidated condensed balance sheets as of August 31, 2023 and May 31, 2023, is $ 94.1 million and $ 92.5 million, respectively.

Amortization expense for service contracts and other assets, was $ 38.5 million and $ 36.4 million for the three months ended August 31, 2023 and 2022, respectively.

(1) The current portion of capitalized contract costs, included in prepaid expenses and other current assets on the consolidated condensed balance sheets as of November 30, 2023 and May 31, 2023, is $ 93.9 million and $ 92.5 million, respectively.

Amortization expense for service contracts and other assets was $ 39.4 million and $ 37.3 million for the three months ended November 30, 2023 and 2022, respectively.

For the six months ended November 30, 2023 and 2022, amortization expense for service contracts and other assets was $ 77.9 million and $ 73.7 million, respectively.

These expenses are recorded in selling and administrative expenses on the consolidated condensed statements of income.

As of August 31, 2023, the estimated future amortization expense for service contracts and other assets, excluding any future acquisitions and commissions to be earned, is as follows:

As of November 30, 2023, the estimated future amortization expense for service contracts and other assets, excluding any future acquisitions and commissions to be earned, is as follows:

Fiscal Year (In thousands)

2024 (remaining nine months)

2024 (remaining six months) $ 77,591

Thereafter 176,763

5 unchanged sentences

Issued Fiscal Year

Maturity August 31,

Maturity November 30,

Debt due within one year

Commercial paper 5.52 % (1)

2024 2024 $ 210,000 $ —

Total debt due within one year $ 210,000 $ —

Debt due after one year

7 unchanged sentences

Total debt due after one year $ 2,474,287 $ 2,486,405

(1) Variable rate debt instrument.

The rate presented is the variable borrowing rate at November 30, 2023.

(2) Cintas assumed these senior notes with the acquisition of G&K Services, Inc.

1 unchanged sentence

The interest rate shown above is the effective interest rate.

The principal amount of these notes is $ 50.0 million with a stated interest rate of 3.88 %.

The principal amount of these senior notes is $ 50.0 million with a stated interest rate of 3.88 %.

Cintas' senior notes, excluding the G&K senior notes assumed with the acquisition of G&K in fiscal 2017, are recorded at cost, net of debt issuance costs.

The fair value of the long-term debt is estimated using Level 2 inputs based on general market prices.

The carrying value and fair value of Cintas' debt as of August 31, 2023 were $ 2,490.0 million and $ 2,396.5 million, respectively, and as of May 31, 2023 were $ 2,500.0 million and $ 2,443.8 million, respectively.

During the three months ended August 31, 2023, Cintas repurchased, and subsequently retired, $ 10.0 million of its 6.15 %, 30-year senior notes.

In conjunction with this transaction, Cintas recognized a loss of $ 0.8 million during the three months ended August 31, 2023, which is recorded in interest expense on the consolidated condensed statement of income.

During the three months ended August 31, 2022, Cintas issued $ 196.0 million, net of commercial paper.

The carrying value and fair value of Cintas' debt as of November 30, 2023 were $ 2,486.6 million and $ 2,396.5 million, respectively, and as of May 31, 2023 were $ 2,500.0 million and $ 2,443.8 million, respectively.

During the three and six months ended November 30, 2023, Cintas repurchased, and subsequently retired, $ 3.5 million and $ 13.5 million, respectively, of its 6.15 %, 30-year senior notes.

In conjunction with these transactions, during the three and six months ended November 30, 2023, Cintas recognized a loss of $ 0.1 million and $ 0.9 million, respectively, which is recorded in interest expense on the consolidated condensed statements of income.

During the six months ended November 30, 2023 and 2022, Cintas issued $ 210.0 million and $ 124.0 million, net of commercial paper, respectively.

The credit agreement that supports our commercial paper program has capacity under the revolving credit facility of $ 2.0 billion.

1 unchanged sentence

The maturity date of the revolving credit facility is March 23, 2027.

As of both August 31, 2023 and May 31, 2023, there was no commercial paper outstanding and no borrowings on our revolving credit facility.

As of November 30, 2023, there was $ 210.0 million of commercial paper outstanding with a weighted average interest rate of 5.52 % and maturity dates less than 90 days and no borrowings on our revolving credit facility.

As of May 31, 2023, there was no commercial paper outstanding and no borrowings on our revolving credit facility.

Cintas uses interest rate locks to manage its overall interest expense as interest rate locks effectively change the interest rate of specific debt issuances.

1 unchanged sentence

Cintas used interest rate locks, which represent cash flow hedges, to hedge against movements in the treasury rates at the time Cintas issued its senior notes in fiscal 2007, fiscal 2017 and fiscal 2022.

The amortization of the interest rate locks resulted in a decrease to other comprehensive income (loss) of $ 1.4 million and $ 1.5 million for the three months ended August 31, 2023 and 2022, respectively.

The amortization of the interest rate locks resulted in a decrease to other comprehensive income (loss) of $ 1.5 million for both the three months ended November 30, 2023 and 2022.

For the six months ended November 30, 2023 and 2022, the amortization of the interest rate locks resulted in a decrease to other comprehensive income (loss) of $ 2.9 million and $ 3.0 million, respectively.

During fiscal 2022 and fiscal 2020, Cintas entered into interest rate lock agreements for forecasted debt issuances.

The aggregate notional value of outstanding cash flow hedges was $ 500.0 million at both August 31, 2023 and May 31, 2023.

The aggregate notional value of outstanding cash flow hedges was $ 500.0 million at both November 30, 2023 and May 31, 2023.

The fair values of the outstanding interest rate locks, for forecasted debt issuances, are summarized as follows:

August 31, 2023 May 31, 2023

November 30, 2023 May 31, 2023

Fiscal Year of Issuance

4 unchanged sentences

The changes in fair value of the interest rate locks are recorded in other comprehensive income (loss), net of tax.

These interest rate locks had no impact on net income or cash flows for the three months ended August 31, 2023 or 2022.

These interest rate locks had no impact on net income or cash flows for the three and six months ended November 30, 2023 or 2022.

Cintas has certain covenants related to debt agreements.

6 unchanged sentences

In the normal course of business, Cintas provides for uncertain tax positions and the related interest and adjusts its unrecognized tax benefits and accrued interest accordingly.

The recorded unrecognized tax benefits were $ 29.3 million as of both August 31, 2023 and May 31, 2023, and are included in long-term accrued liabilities on the consolidated condensed balance sheets.

As of November 30, 2023 and May 31, 2023, recorded unrecognized tax benefits were $ 31.3 million and $ 29.3 million, respectively, and are included in long-term accrued liabilities on the consolidated condensed balance sheets.

The majority of Cintas' operations are in North America.

8 unchanged sentences

Based on the status and resolution of the various audits and other potential regulatory developments, it is expected that the balance of unrecognized tax benefits will not materially change for the fiscal year ending May 31, 2024.

Cintas’ effective tax rate was 19.2 % and 14.8 % for the three months ended August 31, 2023 and 2022, respectively.

Cintas’ effective tax rate was 20.9 % and 22.1 % for the three months ended November 30, 2023 and 2022, respectively.

For the six months ended November 30, 2023 and 2022, Cintas' effective tax rate was 20.1 % and 18.4 %, respectively.

The effective tax rate for both periods was impacted by certain discrete items (primarily the tax accounting for stock-based compensation).

10 unchanged sentences

Balance at August 31, 2023 ( 14,367 ) 103,471 ( 1,935 ) 87,169

Other comprehensive (loss) income before

reclassifications ( 1,813 ) 9,099 379 7,665

Amounts reclassified from accumulated other comprehensive income (loss)

— ( 1,495 ) — ( 1,495 )

Net current period other comprehensive (loss) income ( 1,813 ) 7,604 379 6,170

Balance at November 30, 2023 $ ( 16,180 ) $ 111,075 $ ( 1,556 ) $ 93,339

(In thousands) Foreign

8 unchanged sentences

Balance at August 31, 2022 ( 2,200 ) 92,101 ( 1,777 ) 88,124

The following table summarizes the reclassifications out of accumulated other comprehensive income (loss) for the three months ended August 31:

Other comprehensive (loss) income before

reclassifications ( 9,901 ) 7,394 — ( 2,507 )

Amounts reclassified from accumulated other comprehensive income (loss)

— ( 1,521 ) — ( 1,521 )

Net current period other comprehensive (loss) income ( 9,901 ) 5,873 — ( 4,028 )

Balance at November 30, 2022 $ ( 12,101 ) $ 97,974 $ ( 1,777 ) $ 84,096

The following table summarizes the reclassifications out of accumulated other comprehensive income (loss):

Details about Accumulated

5 unchanged sentences

Statements of Income

(In thousands) 2023 2022

Amortization of interest rate locks $ 1,929 $ 2,033 Interest expense

Three Months Ended Six Months Ended

(In thousands) November 30,

2023 November 30,

2022 November 30,

2023 November 30,

Amortization of interest

rate locks $ 1,998 $ 2,034 $ 3,927 $ 4,067 Interest expense

Tax expense ( 503 ) ( 513 ) ( 990 ) ( 1,025 ) Income taxes

13 unchanged sentences

Other Corporate (1)

As of and for the three months ended August 31, 2023

For the three months ended November 30, 2023

Revenue $ 1,850,542 $ 266,401 $ 260,234 $ — $ 2,377,177

Income (loss) before income taxes $ 399,611 $ 58,531 $ 41,541 $ ( 25,821 ) $ 473,862

For the three months ended November 30, 2022

Revenue $ 1,709,987 $ 235,974 $ 228,897 $ — $ 2,174,858

Income (loss) before income taxes $ 369,095 $ 45,495 $ 30,344 $ ( 28,576 ) $ 416,358

As of and for the six months ended November 30, 2023

Revenue $ 3,677,367 $ 527,094 $ 515,046 $ — $ 4,719,507

Income (loss) before income taxes $ 806,140 $ 118,111 $ 75,988 $ ( 49,943 ) $ 950,296

Total assets $ 7,405,444 $ 733,074 $ 589,795 $ 85,556 $ 8,813,869

As of and for the three months ended August 31, 2022

As of and for the six months ended November 30, 2022

Revenue $ 3,407,759 $ 470,135 $ 463,418 $ — $ 4,341,312

10 unchanged sentences

This is a contract dispute whereby plaintiffs allege that Cintas breached its contracts with participating public agencies and seek, among other things, contract-based damages in an unspecified amount.

In March 2022, the District Court denied Cintas’ motion to compel arbitration, and on March 6, 2023, the Ninth Circuit Court of Appeals affirmed.

In March 2022, the U.S.

District Court for the District of Nevada denied Cintas’ motion to compel arbitration, and on March 6, 2023, the Ninth Circuit Court of Appeals affirmed.

Any liability in this matter is not probable nor estimable at this time.

The Company, the Board of Directors, Scott Farmer (Executive Chairman) and the Investment Policy Committee are defendants in a purported class action, filed on December 13, 2019, pending in the U.S.

District Court for the Southern District of Ohio alleging violations of The Employee Retirement Income Security Act of 1974 (ERISA).

The lawsuit asserts that the defendants improperly managed the costs of the employee retirement plan, breached their fiduciary duties in failing to investigate and select lower cost alternative funds and failed to monitor and control the employee retirement plan’s recordkeeping costs.

In November 2023, an agreement in principle was reached with the plaintiffs, which would require a payment of an immaterial amount that would be covered by the Company's insurance.

The settlement remains subject to reaching a definitive agreement and the approval of the U.S.

District Court for the Southern District of Ohio.

Cintas records an accrual for legal contingencies when Cintas determines that it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

As of August 31, 2023 and 2022, Cintas did not accrue any additional sums in excess of its other legal contingency accruals for adverse jury verdicts arising in the ordinary course of its business.

As of November 30, 2023 and May 31, 2023, Cintas did not accrue any material amounts for legal contingencies.

The litigation discussed above, if decided or settled adversely to Cintas, may result in liability material to Cintas' consolidated financial condition, consolidated results of operations or consolidated cash flows and could increase costs of operations on an ongoing basis.

Any estimated liability relating to this proceeding is not determinable at this time.

Cintas may enter into discussions regarding settlement of this and other lawsuits and may enter into settlement agreements if it believes such settlement is in the best interest of Cintas' shareholders.

Cintas may enter into discussions regarding settlement of these and other lawsuits and may enter into settlement agreements if it believes such settlement is in the best interest of Cintas' shareholders.

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-Q

Item 1. Financial Statements