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F500-2021-410-Cintas

Starting out as the acme Industrial Laundry Company in 1929, the corporation now outfits America's workforce with uniforms and cleaning supplies.

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Cintas provides uniform rentals, floor care, restroom supplies, first aid and safety products, and fire extinguishers to businesses, primarily in North America.

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Cintas specializes in providing businesses with essential products and services to ensure their operations are clean, safe, and professional. Serving over 1 million customers across the U.S. and Canada, Cintas offers a comprehensive range of solutions, including uniform rental, facility services, first aid and safety products, fire protection services, and compliance training. Its products and services encompass uniforms, mats, mops, restroom supplies, workplace water services, safety products, eye-wash stations, safety training, fire extinguishers, sprinkler systems, and alarm services.

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Cintas (CTAS): Company Profile, Stock Price, News, Rankings

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Cintas

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Good day, everyone, and welcome to the Cintas Corporation Announces Fiscal twenty twenty five Fourth Quarter and full year results conference call. Today's call is being recorded. At this time, I would like to turn the call over to Mr. Jared Mattingly, Vice President, Treasurer and Investor Relations. Please go ahead, sir.

Thank you, Ross. Thank you for joining us. With me are Todd Schneider, President and Chief Executive Officer Jim Rozakis, Executive Vice President and Chief Operating Officer and Scott Garula, Executive Vice President and Chief Financial Officer. We will discuss our fiscal twenty twenty five fourth quarter and full year 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.

Thank you, Jared, and thank you all for joining us. I'd like to take a moment and welcome Jim and Scott to our call today. Jim is a seasoned leader that brings twenty six years of experience with Cintas, and over the last two years has served as Cintas' Chief Operating Officer. Scott was recently appointed as our Chief Financial Officer and brings with him over twenty nine years of experience, including leading each of our route based businesses. On today's call, I'll start by sharing an overview of the quarter, the year and our outlook for fiscal twenty twenty six.

Jim will share some more detail on our segment performance and the drivers in the business, and Scott will wrap up with more detail on our financials. We are pleased to have delivered a strong fourth quarter to close out another impressive fiscal year for CentOS. We delivered robust top line growth and maintained healthy margins and cash flow, excuse me, demonstrating the strength of our value proposition. In the fourth quarter, total revenue grew 8% to $2,670,000,000 Our organic growth rate, which adjusts for the impacts of acquisitions, foreign currency exchange rate fluctuations and workday differences was 9%. We continue to execute at a high level across each of our businesses, including organic growth of 7.2% in the Uniform Rental and Facility Services segment and 18.5% in our First Aid and Safety segment.

All Other, which includes our fire protection services and Uniform grew Direct organically by 11.1%. Turning to profitability. Gross margin for the fourth quarter grew 9.1% over the prior year from 49.2% to 49.7. Operating income as a percentage of revenue increased 9.1% over the prior year, and diluted EPS increased 9% to $1.09 We remain confident that the strategic investments we've made in the business position us to capitalize on future growth opportunities. Those investments include technology that makes it easier for our employee partners to do their jobs, such as our SAP system and SmartTruck platform investments in our infrastructure to increase capacity and position our employee partners for success as well as investments in management trainees and selling resources.

For the full year, fiscal twenty twenty five revenue was a record $10,340,000,000 an increase of 7.7%. Organic growth was 8% for the year. Our top line growth continues to underscore the strength of Cintas' value proposition. Operating margins for the full year were 22.8%, an increase of 14.1% and an all time high compared to our prior year operating margin of 21.6%. Diluted earnings per share of $4.4 grew 16.1% over the prior year.

Balanced capital allocation remains a key pillar of our strategy. In the fourth quarter and throughout fiscal twenty twenty five, we continue to deploy capital across all of our strategic priorities, including reinvesting in our products, people and technologies to ensure we are best positioned to deliver value for our customers. Looking ahead to fiscal twenty twenty six, our financial expectations reflect both the strength of the underlying business and our commitment to disciplined execution. Scott will later touch on the assumptions included in our guidance. We expect our revenue to be in the range of $11,000,000,000 to $11,150,000,000 a total growth rate of 6.4% to 7.8%.

We expect diluted EPS to be in the range of $4.71 to $4.85 a growth rate of 7% to 10.2%. Our fourth quarter and full year 2025 results and 2026 outlook underscore the strength of our business model and our ability to execute in a dynamic environment. Fiscal twenty twenty five now marks fifty four years out of the last fifty six years we've grown sales and adjusted EPS. I want to thank all of our employee partners for their hard work and dedication. With our culture of continuous improvement, superior products and services and disciplined execution, we are well positioned for sustained growth and value creation.

Lastly, we were named to the prestigious Fortune 500 for the ninth consecutive year. It is an honor to be recognized among the most successful and respected companies. We're proud of these results and the value we continue to deliver for CentOS' shareholders. With that, I'll turn it over to Jim for additional insights.

Thanks, Todd, and good morning. We continue to grow at attractive rates by helping new customers meet their needs of image, safety, cleanliness and compliance. We are seeing success in adding new products and new services to existing customers. Our retention rates are right at our all time highs and pricing continues to be at our historical levels. Turning to the fourth quarter organic growth by business.

We grew 7.2% for Uniform Rental and Facility Services, 18.5% for First Aid and Safety Services, 12.1% for Fire Protection Services and Uniform Direct sale was up 9%. As we've done in the past, I will share revenue mix of the Uniform Rental and Facility Services operating segment for the fourth quarter. Keep in mind, can be small fluctuations in mix between quarters. Uniform Rental was 48%, Dust was 19%, Hygiene was 16%, Shop Towels were 3%, Linen, which includes microfiber, wipes, towels and aprons was 10%, and Catalog revenue was 4%. These percentages are consistent with last year and demonstrate we continue to experience strong demand across all our products and services.

Gross margin percentage by business was 49% for Uniform Rental and Facility Services, 56.8% for First Aid and Safety Services, 49.3% for Fire Protection Services and 41.6% for Uniform Direct Sale. Gross margin for the Uniform Rental Facility Services segment increased 40 basis points from last year. Our progress year over year reflects the positive impacts made by our excellent supply chain team as well as cost savings initiatives such as our garment sharing, technology enhancements like our auto sortation systems in our plants and our proprietary Smart Truck solution that makes our routes more efficient. Gross margin for the First Aid and Safety Services segment increased 140 basis points from last year, with strong revenue growth continuing to create leverage. A healthy revenue mix that includes growth in high margin recurring revenue products like AED rentals, high wash stations and water brake, as well as cost savings initiatives such as smart truck and improved sourcing.

Before I turn over to Scott, I'd to share an example that demonstrates how we're delivering for our customers. A customer in the Southeastern part of the country has been a valued customer for over ten years. For most of that time, we provided them exclusively with facility services, products and services. Their maintenance department uniforms were direct purchase, what we would call a no programmer. Our customer approached us to see if we could help them address three key pain points.

One, the initial investment ongoing costs associated with replacing uniforms due to turnover and damage made it difficult to forecast spend and manage cash flow. Two, their employees expressed a strong preference for the convenience and professionalism of a laundered uniform program over washing their uniforms at home. Three, their managers found that overseeing uniform logistics in house took valuable time away from focusing on their core business operations. In response, we successfully introduced our Uniform Rental program on top of our facility services offering. But the story doesn't end there.

We also earned a trust in their culinary department, onboarding those employees who had previously been with a traditional Uniform competitor. The switch was driven by a premium ChefWorks exclusive attire and the opportunity for vendor consolidation. This example underscores several points. First, we don't always have to leave with uniforms. In this case, we had a long successful relationship with a customer built on our facility services offering.

Second, we can grow in a variety of different ways. We can convert no programmers to a rental program. We can add new customers that are currently with another Uniform Rental provider by offering premium products and services. And we can grow by adding new products and services to our existing customers. This example also illustrates how Santos is more than a service provider.

We are true problem solvers committed to helping our customers succeed. And by staying attuned to their feedback, we continue to strengthen our relationships and expand our footprint across industries. And I'll turn it over to Scott for additional details on capital allocation strategy and 2026 outlook.

Thank you, Jim, and good morning, everyone. As Todd mentioned, we closed our fiscal year with strong financial performance. Our balance sheet remains healthy and during fiscal twenty twenty five, we generated $1,600,000,000 of free cash flow. In the fourth quarter, we were able to put our capital to work through capital expenditures of $114,600,000 acquisitions of $34,100,000 dividends of $157,800,000 and share repurchases of $256,700,000 Our effective tax rate for the fourth quarter was 22.1% compared to 21.4% last year. For fiscal twenty twenty five, the effective tax rate was 20% compared to 20.4% the prior year.

During fiscal year twenty twenty five, we deployed significant capital across each of our capital allocation priorities. This capital allocation strategy has been effective for many years and has served us well. We invested $408,900,000 in capital expenditures, which helps support investments in our technology and infrastructure. Capital expenditures were 4.4% of revenue, which is right where we like to be. We invested $132,900,000 in acquisitions in fiscal twenty twenty five, representing our largest year of M and A activity in almost twenty years, excluding our 2017 acquisition of G and K.

These acquisitions spanned across each of our three route based segments, adding new customers, extending capacity and delivering compelling synergies. By optimizing our existing route structure, we've been able to spend more time with customers, while reducing time spent on the road. Acquisitions remain an important lever for growth, enabling us to broaden our offerings and deliver greater value to our stakeholders. Additionally, we returned over 1,000,000,000 point dollars to shareholders through dividends and share buybacks. Almost $612,000,000 in dividend payments marks the forty first consecutive year that we've increased our dividend, which is every year since going public.

We also repurchased approximately $935,000,000 of shares fiscal year twenty twenty five. Todd provided our fiscal twenty twenty six outlook at the start of the call. And I'd like to provide some context on a few assumptions underpinning our guidance. Please note that both fiscal twenty twenty five and fiscal twenty twenty six have the same number of workdays for the year and by quarter. Our guidance does not assume any future acquisitions.

Our guidance assumes a constant foreign currency exchange rate. The fiscal twenty twenty six interest net is expected to be approximately $98,000,000 The fiscal twenty twenty six effective tax rate is expected to be 20%, which is the same as fiscal twenty twenty five. And our guidance includes no future share buybacks or significant economic disruptions or downturn. With that, I'll turn it back over to Todd for closing remarks.

Thank you, Scott. As we look ahead to fiscal twenty twenty six, our results reflect the strength of our strategy and the value we provide in helping our customers meet their image, safety, cleanliness and compliance needs. We remain focused on delivering exceptional customer experiences while continuing to make the necessary investments in our business to sustain long term growth and value creation. Our confidence in our ability to navigate the current environment and capitalize on future opportunities remains strong. Jared, back to you.

Thanks, Todd, Jim and Scott. That concludes our prepared remarks. Now we are happy to answer questions from the analysts. Please ask just one question and a single follow-up if needed. Thank you.

And our first question comes from George Tong from Goldman Sachs. Please go ahead, George.

Hi, thanks. Good morning. Starting at a high level, can you talk a little bit about what the overall selling environment looks like, including how sales cycles are performing and how client sentiment is trending?

Good morning, George. Thanks for the question. I'll start and then Jim if you want to add any color. No real change to the customer behavior, sales cycles. New business remains strong.

Retention rates are still at very attractive levels. Add stops really no significant change there. It is there are certain excuse me, clearly there's more uncertainty in the marketplace with tariff trade tax or excuse me, tarifftrade taxes, which has a little bit more clarity, and interest rates. But nevertheless, our value proposition continues to resonate. And it resonates virtually every economic cycle, hence our 54 the last fifty six years.

And we expect that to continue and we like the position we're in. Anything else Jim on customer behavior that you'd like to contribute?

Yes. I think maybe Todd, the only color I would add on that is that the customer behavior offers an opportunity for us to add value to our customers. I was recently at an operational visit. And in a routine conversation, one of our employee partners was out a customer site. And as you can imagine during traditional rapport building, the customer expressed concern regarding the overall uncertainty in a macro environment. Our employee partner turned out an opportunity to discuss further Cintas products and services.

And we found out that we were able to go ahead and save this customer significant money on something as simple as disposable gloves. So there certainly is a degree as you described of a little bit of uncertainty, that uncertainty creates opportunity and the customers are looking for answers and oftentimes we'll to provide those answers for them.

Very helpful. And then my follow-up, you're continuing to see and deliver operating margin expansion from what was 4050% before to around 25%. Can you talk a bit about what factors may be causing this narrowing rate of margin expansion?

Yes, George. Yes, we had another really good profit quarter. We did run 22.4% operating profit for the quarter. That brings us to 35% incrementals for the year, excluding our land sale. I will say last year Q4 was by far our best profit quarter.

So the comparables were certainly tougher. And as you know, running a business isn't linear, but we like where we are. We're right in that sweet spot of 25% to 35 incrementals. And we're investing for the future. And we're doing that because we see the opportunities ahead and we like what the opportunities look like for us. So we're investing appropriately.

And our next question comes from Jasper Bibb from Truist Securities. Please go ahead, Jasper.

Hey, good morning, guys. I know you guys get all the way down. I was just hoping you could give a little bit more color on the cadence of your 2026 outlook, as I imagine you're going have a lot more difficult comps on the incremental margin front in the first half versus second half.

Jasper, thanks for the question. Yes, on the revenue side, we just finished a very successful year where we grew 7.7%, which is right where we want to be. The '26 revenue guide calls for 6.4% to 7.8%, which again, a growth, which again is right where we like to be and sets us up for another really good year. We're performing well and we like the momentum that we have in the business. On the EPS side, we had a great year in FY 2025 and we think we're set up for another really good year in FY 2026.

The guide calls for EPS growth of 7% to 10.2%, which infers margin expansion throughout the guide. And at the midpoint of revenue EPS guide, it also represents operating margin above 23% and incrementals in the high 20s. So this is all consistent with how we guided last year. And this year, certainly the macro environment is there is a little bit more uncertainty, but we think we're well positioned to navigate the environment and have another very successful year in 2026.

Got it. Hoping maybe you could give some color on what you're seeing in the ad stops and how you're thinking about that trend in your fiscal twenty twenty six guidance?

Yes. Jasper, good question. We have an incredibly broad customer base. So we have some customers that are absolutely thriving in this environment, some are dealing with input costs challenges. But the net net is our customer base is still performing well and we think that we're in a good position there.

Keep in mind, 70% of our customer base are in the services providing sector, 30% in the goods producing. But we so from an ad stop standpoint, we think we're in a good spot. We don't give out that specific number, but we like the momentum that we see in our business.

And our next question comes from Manav Patnaik from Barclays Capital. Please go ahead, Manav.

Hi, good morning. This is Ronan Kennedy on for Manav. Thank you for taking my questions. You touched on this in response to Jasper's question, but if I may just look to go a little more granular. The 26 guide is the implied operating income margins of 25% I think are at the lower end of the mid term guide at '25 to 35 and then 2327 at the low and high ends respectively.

There's obviously an element of operating leverage at play and revenues, but any further insights you can shed as to the puts and takes to drivers of those incrementals, whether it's the positive impacts of supply chain, tech initiatives, or the negative impacts, say, of the SAP implementation for fire protection? Any further insights on kind of puts and takes to those incrementals please?

Yes. Thank you, Ronan. Yes, we like our guide. We think we're the incrementals are right where we want to be. Certainly, there is we will be continuing to invest in SAP in our fire business.

Does that that's not an inexpensive effort there. But that's all contemplated in our guide as is any input cost challenges that are thrown our way as a result of the environment that the macro environment that we're dealing with, etcetera. So we feel good about the spot we're in from an incremental margin standpoint, again, 5% to 35%. And we're investing appropriately. Running a business isn't linear.

So we but we're focused on the long term and positioning our partners and customers to be incredibly successful. And we like the spot that we're in.

Thank you. And then for my follow-up, please. Similar question in relation to revenues. The range the guided revenue range is, I think, 140 basis points, which you understandably indicated is right where you want to be. I also think that range is consistent with the guided range for f twenty five.

Can you give us any further insight as to what that contemplates from organic by department or the expected contributions from say price, new biz, etcetera versus historicals? Any further insight there please would be greatly appreciated.

Yes, certainly Ronan. Yes, we like our guide on the revenue as well. We think we're positioned there. The net for us, we want to grow our business in the mid to high single digits revenue. We certainly expect that our rental business will be similar and our fire and first aid businesses be in the double digit area.

And then in our uniform direct sale business, as we've detailed out, we are not trying to grow that as aggressively. Low single digits would be a good way to think about it. But it is a very strategic business because those rather large customers we sell are route based businesses into as well. So that's kind of how we think about it.

And our next question comes from Tim Mulrooney from William Blair. Please go ahead, Tim.

for taking my questions. Just the first one on the quarter, your fourth quarter results here, organic growth was 9%, That was well above consensus. I was also above what was implied by your own guidance range that you provided last quarter. So I'm just curious what business lines or sectors picked up during the quarter relative to your own expectations?

Yes. Thank you, Tim. Yes, we're really proud of our fourth quarter performance. It did exceed our expectations. I think underscores the momentum we have in our business.

We did have for some, I'll call it more discrete type one time benefits in the area of our first aid business. We were propelled by, I mean, a great performance in our training area, which those tend to be a little bit more discrete one time in nature. Our uniform direct sale business grew 9%, which was a really strong close to a what was a bumpy year. So a little bit more one time in nature there, but we're really proud of the performance in the close of the year. And we think we're well positioned for FY 2026.

And our next question comes from Andrew Steinerman from JPMorgan. Please go ahead, Andrew.

Hi. The quarter ended six weeks ago and I just wanted to get a sense of how the current quarter started just what's already kind of behind us in June in the first couple of weeks of July in terms of revenue growth momentum? Has it sort of been consistent with the way you finished the quarter? And then I'll just ask my second question also. I just saw some discussion.

I was just wondering if there's any recent changes to your go to market strategy, particularly around national accounts?

Good morning, Andrew. Thanks for the question. First off, yes, you're right. I mean, we're because of this being our Q4 call, are further into our quarter than normal. And the start of the year is it's starting exactly the way we expected and it's reflected in our guide.

So kind of well, I would say consistent with what we expected for the start of the year. As for our go to market strategy, that really hasn't changed. Websites change. And we talk about trying to position ourselves appropriately to all of our customers. But we've been in the national account business for thirty plus years, I'd say virtually my entire career.

And the only thing I would call out is our vertical strategy is obviously has been different over the last five to ten years and that has performed well. So no other change no real change in our market strategy. We're constantly reinvesting in our products and services to make them of more value to our customers and to position our employee partners to make it easier to take care of our customers. So there's always refreshes going on, a product here, product there. That's just part of our culture to try to make sure we're positioned to be successful as possible.

And our next question comes from Josh Chan from UBS. Please go ahead,

Hi. Good morning, Todd, Jim, Scott, Jared. As you look into your different cost buckets kind of going into 2026, material, labor, your fleet, anything to highlight in terms of trajectory of cost changes? And maybe on the material side, could you touch on potential tariffs impact and how that could have how that could impact kind of the cost? Yes.

Good morning, Josh. Yes, I want to just speak a little bit about that subject. We believe we're in a good position to navigate through what is a clearly a very dynamic environment with challenges like tariffs and what have you. We think it gives us an opportunity to flex our strength, which is our people and our culture, which in all this is reflected in our guide. We contemplated some additional expense into the guide, but we have some we think some real advantages. First off, the nature of how we expense our goods in our largest businesses is because we amortize it, it gives us time.

It also we you probably noticed our balance sheet, our inventory is up. So we've anticipated and managed this appropriately. And I'd like to also say that we've navigated this very successfully in the past. The past five years, whether it's been inflation or supply chain challenges, our global supply chain has shined and has been a competitive advantage for us in the marketplace. As a reminder, we source products all over the world.

So we have great geographic diversity. And we also have 90% or so of our products, we have two or more sources. You put that together with our buying power, all that gives us options and leverage. So we think that that positions us well. And you put on top of that our corporate culture traits of positive discontent, competitive urgency.

It fuels us to look at process improvements and finding ways to extract inefficiencies out of our business, so that we can be more efficient. We don't take the approach that well, if a tariff is going to raise a cost, then we just got to eat that and pass along to our customer. It's not how we run our business and it's not how we've run it in the past and it's not how we're going to run-in the future. We're and we think it gives us an opportunity to shine.

And Josh, if I might add to that, I think Todd did a great job describing the supply chain. He also talked about some of the work we're doing to remove inefficiencies. We have several initiatives ongoing, some were mentioned in our prepared remarks that are all in play and again contemplated in next year's expectations. But our garment sharing would be one that I think would be worth highlighting here. We continue to leverage the SAP platform to be able to share goods that we have in inventory across our entire network and that's been quite effective and we think we've got some room to go on that one.

Automating within our plants and deploying auto sortation technology in our plants, we have about 50% of our plants have some degree of auto sortation and we're in the middle of trying to deploy more of that. In the past, it's been challenging due to our plants being all different shapes and sizes. We believe that we develop technology to overcome that and limit the disruption. So those are in motion and we expect those to continue to deploy this year. Todd mentioned operational excellence.

Operational excellence is us really maximizing the assets specifically in our rental business around the plant that allows us to continue to defer capital expenditure and it also allows us to run those plants more efficiently, allowing us to wash fewer loads, consume less energy, less chemistry and water within our facilities. And then maybe last that I would be mentioning would be our SmartTruck initiative that's been ongoing now for several years that allows us to incrementally route our fleets more efficiently, get them more time in front of the customer. But certainly, route growth is significantly less than what our revenue growth is, and we're going to continue that in this next fiscal.

That's great color. I appreciate the context there. That's really helpful. And then, I guess, for my follow-up, I think, Scott, you highlighted the M and A spend this past year. Just wondering if you could comment on the prospects of M and A kind of going forward and how the pipeline of the bolt ons look at the moment. Thanks.

Why don't I start a little bit on pipeline and then Scott can talk about capital allocation. M and A is tough to predict, but it's very important to us. These relationships that we have we've had for decades And in trying to figure out when a business is going to be interested in selling is I mean, it's not random, it is certainly tough to predict. We had a great year and we leveraged those relationships that we've had for decades. And but we're in the business of buying really good businesses.

And when you buy really good businesses, you get a lot of things, but you get customers and you get employee partners and are most important areas. And in certain cases, we get capacity. And if we don't get capacity, we get really good synergy. So we'll continue to work our pipeline and but nevertheless, we can't time it, but we're highly active so that when somebody is interested, we're well positioned for that. Scott, do you want to talk a bit about capital allocation?

Yes. Thanks, Todd. As I mentioned in our prepared remarks, our approach to a balanced capital allocation strategy has served us well for many years. I've been part of that in my prior roles and really don't see a change in that in the future. And continue not only to invest in M and A activity, we'll continue to reinvest back in the business via capital expenditures and continue to invest in both dividends and be opportunistic with share buybacks.

Great. Thank you for your time and congrats on a good quarter.

And our next question comes from Jason Haas from Wells Fargo. Please go ahead,

Hey, good morning and thanks for taking my questions. I'm curious if you expect the industry to pass on higher price increases in fiscal twenty twenty six given the tariff driven inflation and if that's something that you've baked into your guidance assuming you could take more price as well and what that could represent upside? Thank you.

Thanks for the question, Jason. Our pricing strategy is we're back at historical levels on pricing. We certainly don't control how our competitors price things, but we expect to be at historical levels of pricing. What we know of the environment today, we think we're well positioned. It's contemplated in our guide.

And as I mentioned earlier, we don't just run our business in a manner where well, if a tariff comes through and there is some cost increase, first off, we don't just accept that. And then secondly, we find ways to run our business more efficiently because we operate in a competitive environment, competitive marketplace. And as a result, want to make sure that we're being great fiduciaries for not only our shareholders and our partners, but our customers. So our guide contemplates historical pricing and that's how we would plan to manage the business.

Okay. Thank you. That's helpful. And then as a follow-up, I was curious in this environment if you're seeing more competitive wins, particularly from some of your larger competitors that are out there since it seems like your growth rates are quite elevated versus what we've seen from others? Thank you.

Yes. So again, thanks for the question. No real change in the marketplace, I'd say from a competitive landscape. It's been competitive my entire career and I'm sure it will be into the future as well. That being said, we don't look at it as a finite pie.

There's we have a little over a million business customers. There's 16,000,000 to 17,000,000 businesses in The U. S. And Canada. So we look at it as an opportunity to go and sell more to those customers who are not buying from us today.

And then we have this incredible opportunity to sell more products and services to our current customers. How someone else in our direct competitor might be growing is that's not of interest to us. We're more focused on how can we provide more value to our customers, how can we position our employee partners to be more successful? We want to be easier to do business with, want to be easier for our partners to sell and easier for our customers for them to do business with us.

And our next question comes from Ashish Sabadra from RBC. Please go ahead, Ashish.

Thanks for taking my question. I just wanted to focus on the four strategic verticals, healthcare, government, education and hospitality. I was wondering if you could just provide any update on those fronts and any big initiative as we go into 2026. Thanks.

Cintas (CTAS) Q4 2025 Earnings Call Transcript

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