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Feb 28, 2023
Cintas Q3 2023 Earnings Report
Cintas reported strong Q3 2023 results driven by double-digit increases in operating income and diluted EPS, excluding the prior year gain and related tax benefit.
Key Takeaways
Cintas Corporation reported an 11.7% increase in revenue for the third quarter of fiscal 2023, reaching $2.19 billion. Diluted earnings per share (EPS) was $3.14, compared to $2.97 in the previous year. The company is raising its full fiscal year financial guidance for both revenue and diluted EPS.
Revenue for Q3 2023 increased by 11.7% to $2.19 billion compared to the previous year.
Organic revenue growth rate for Q3 2023 was 11.8%.
Diluted earnings per share (EPS) for Q3 2023 was $3.14, up from $2.97 in the previous year.
Cintas is raising its full fiscal year financial guidance, expecting revenue to range from $8.74 billion to $8.80 billion and diluted EPS to range from $12.70 to $12.90.
Cintas
Cintas
Cintas Revenue by Segment
Revenue by Segment
Uniform Rental & Facility Revenue
CapyFin.comFirst Aid & Safety Revenue
CapyFin.comAll Other Revenue
CapyFin.com Forward Guidance
Cintas is increasing its full fiscal year financial guidance. The company is raising its annual revenue expectations from a range of $8.67 billion to $8.75 billion to a range of $8.74 billion to $8.80 billion and diluted EPS from a range of $12.50 to $12.80 to a range of $12.70 to $12.90.
Positive Outlook
- Fiscal year 2023 operating income is expected to be in the range of $1.77 billion to $1.80 billion compared to $1.55 billion in fiscal year 2022, adjusted to exclude the fiscal 2022 gains.
- Our diluted EPS guidance includes no future share buybacks.
- Total revenue is expected to be between $8,740.0 million and $8,800.0 million.
- Operating income is expected to be between $1,770.0 million and $1,800.0 million.
- EPS is expected to be between $12.70 and $12.90.
Challenges Ahead
- Fiscal year 2023 interest expense is expected to be approximately $112.0 million compared to $88.8 million in fiscal year 2022, due in part to higher interest rates.
- Fiscal year 2023 effective tax rate is expected to be 20.7% compared to a rate of 17.9% in fiscal year 2022, after excluding the fiscal 2022 gains.
- We remain in a dynamic environment that can continue to change.
- Our guidance assumes a stable economy and excludes significant economic disruptions or downturns.
- The company faces risks related to operating costs, sales volumes, customer loss, integration of acquisitions, inflationary pressures, interest rate volatility, union activities, government regulations, exchange rate fluctuations, environmental compliance, cybersecurity risks, litigation, sourcing costs, and disruptions from catastrophic events including global health pandemics.
Revenue & Expenses
Visualization of income flow from segment revenue to net income