Cintas (CTAS) Q1 2025 earnings summary

Executive summary

• Fiscal Q1 2025 revenue reached $2.5 billion, up 6.8% year-over-year, with organic growth at 8.0% after adjusting for acquisitions, FX, and fewer workdays, driven by new business, product penetration, and price increases.

• Net income increased 17.4% to $452 million, and diluted EPS rose 18.3% to $1.10, reflecting a recent four-for-one stock split.

• All business divisions contributed to growth, with strong demand across healthcare, hospitality, education, and government verticals.

• Operational excellence, technology investments, and supply chain initiatives drove margin expansion and efficiency.

• Cash flow from operations grew 38.5% to $466.7 million; free cash flow reached $373.8 million.

Financial highlights

• Gross margin rose 9.7% to $1.25 billion, reaching 50.1% of revenue, up 140 basis points year-over-year.

• Operating income was $561 million (22.4% of revenue), up 12.1% year-over-year and a record high.

• Uniform rental and facility services revenue grew 5.9% to $1.93 billion; First Aid and Safety Services revenue increased 12.2% to $292.6 million.

• Net cash provided by operating activities was $466.7 million, up from $336.9 million in the prior year quarter.

• Dividends paid totaled $157.9 million and share repurchases reached $614.8 million during the quarter.

Outlook and guidance

• Fiscal 2025 revenue guidance raised to $10.22–$10.32 billion (6.5%–7.5% growth), with organic growth expected at 7.0%–8.1%.

• Diluted EPS guidance increased to $4.17–$4.25 (10.0%–12.1% growth).

• Effective tax rate expected at 20.4% for fiscal 2025; Q1 effective tax rate was 15.8%, down from 19.2% last year.

• Net interest expense projected at $101 million, up from $95 million in fiscal 2024.

• Guidance assumes no future acquisitions, constant FX, and no additional share buybacks.