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Uniform rental firm Cintas raises profit forecast on lower expenses, steady demand
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Uniform rental firm Cintas raises profit forecast on lower expenses, steady demand
Dec 19, 2024 7:16 AM

Dec 19 (Reuters) - Cintas ( CTAS ) on Thursday raised

its forecast for full-year profit after beating estimates for

second-quarter earnings, driven by lower expenses as well as

steady demand for its products including uniforms rentals and

cleaning supplies.

Cintas ( CTAS ) offers a variety of services and products, such as

uniform cleaning, safety training courses and fire extinguisher

inspections, which it cross-sells that helps boost its revenue.

The company's quarterly revenue benefited from a growth in

U.S. jobs. In November, a rise in unemployment rate to 4.2%

pointed to an easing labor market, according to the Labor

Department.

In the second quarter ended Nov. 30, the company also saw

gross margin increase by 180 basis points to 49.8%, helped by

lower energy expenses including gasoline and natural gas.

Shares of the company, which have risen nearly 36% this

year, were however down 7% in early trading on Thursday as the

company raised only the lower end of its annual sales forecast.

The company now sees annual sales between $10.26 billion and

$10.32 billion, compared with prior expectation of $10.22

billion to $10.32 billion.

It also posted quarterly sales of $2.56 billion that were in

line with estimates.

Cintas ( CTAS ), however, expects full-year earnings per share

between $4.28 and $4.34, compared with a prior range of $4.17 to

$4.25.

The company earned $1.09 per share for the reported quarter,

topping analysts' expectations of $1.01, according to data

compiled by LSEG.

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