Cintas Corporation's (CTAS) Q4 2022 Earnings Call Transcript

For the period ending May 31, 2022

July 14, 2022 10:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good day, everyone. And welcome to the Cintas Fourth Quarter and Full Year 2022 Earnings Release Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Paul Adler, Vice President and Treasurer, Investor Relations. Please go ahead, sir.

Paul Adler - VP and Treasurer, IR

Thanks Darren. And thank you for joining us. With me is Todd Schneider, President and Chief Executive Officer; and Mike Hansen, Executive Vice President and Chief Financial Officer. We will discuss our fiscal 2022 fourth quarter results. After our commentary, we will open the call to questions from analysts.

The Private Securities Litigation Reform Act of 1995 provides a Safe Harbor from civil litigation for forward-looking statements. This conference call contains forward-looking statements that reflect the company's current views as to future events and financial performance.

These forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those we may discuss. I refer you to the discussion on these points contained in our most recent filings with the Securities and Exchange Commission.

I'll now turn the call over to Todd.

Todd Schneider - President and CEO

Thank you Paul. Our fourth quarter financial results are led by a strong revenue increase of 13.0% to $2.07 billion. Despite strong inflationary headwinds, operating income margin increased 10 basis points to 19.5% and EPS grew 13.8% to $2.81. Our sales force continues to add new customers and penetrate and cross-sell our existing base. Businesses prioritize, [all we] [ph] provide including image, safety, cleanliness, and compliance. Challenge was finding labor to run their business, heighten concerns over sanitization and the inflationary labor and purchasing costs, businesses increasingly outsourced to Cintas to help them get ready for the workday.

We were able to deliver increased operating margin and EPS despite this period of significant inflation by productively selling new business, penetrating existing customers with more products and services, providing excellent service while driving operational efficiencies and obtaining incremental price increases from our customer base.

Fourth quarter free cash flow increased 15.2% from last year. On June 15, we paid shareholders $98.2 million in quarterly dividends. And during the fourth quarter and through July 13, 2022, we purchased $496.5 million of Cintas common stock under our buyback program. We continue to allocate capital in many ways to improve shareholder returns.