Cintas Reports Robust Q2 Growth

Top 40 distributor Cintas (asi/162167) reported year-over-year increases in revenue, net income and earnings per diluted share during its fiscal 2018 second quarter, which ended Nov. 30.

In an earnings statement released late Thursday, the Cincinnati-headquartered company said that Q2 revenue tallied $1.61 billion, an increase of 26.4% over last year’s second quarter. Organic revenue growth, which adjusts for the impacts of acquisitions and foreign currency exchange rate fluctuations, registered 7.7%.

Performance was also strong when it came to quarterly net income from continuing operations, which Cintas reported as rising nearly 13% to $137 million. Meanwhile, earnings per diluted share jumped from $1.12 in Q2 2017 to $1.24 in 2018, the company reported. Additionally, operating income for 2018’s second quarter soared 17.3%, year-over-year, to $235 million.

“Earlier this month, on Dec. 8th, we were pleased to increase total shareholder return by paying an annual dividend of $1.62 per share, an increase of 21.8% over last year’s annual dividend,” said Cintas Chairman and CEO Scott D. Farmer. “We have increased the annual dividend for 34 consecutive years.”

Given Cintas’ strong performance, the company announced that it is increasing its fiscal 2018 guidance. “We are raising our revenue guidance from a range of $6.325 billion to $6.4 billion to a range of $6.365 billion to $6.430 billion and EPS from continuing operations from a range of $5.30 to $5.38 to a range of $5.39 to $5.46,” said Farmer, who noted those numbers exclude certain possible expenses and potential impacts, such as those that might be experienced from U.S. tax reform.

With estimated 2016 North American promotional product revenue of $163.3 million, Cintas ranks 11th on Counselor’s 2017 list of the largest distributors in the industry by revenue.