UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT
OF 1934
Date of Report (Date of
earliest event reported)
June 29, 2005
UNIFIRST CORPORATION
(Exact
Name of Registrant as Specified in Charter)
| Massachusetts |
1-8504 |
04-2103460 |
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
68 Jonspin Road,
Wilmington, Massachusetts 01887
(Address of Principal Executive
Offices) (Zip Code)
Registrant’s telephone number, including area code: (978) 658-8888
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 |
Written communications
pursuant to Rule 425 under the Securities Act |
| |
Soliciting material
pursuant to Rule 14a-12 under the Exchange Act |
| |
Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act |
| |
Pre-commencement communications
pursuant to Rule 13e-4(c) under the Exchange Act |
Item 2.02 Results of Operations and Financial Condition.
On June 29, 2005, UniFirst Corporation issued a press release (“Press Release”) announcing financial results for the third quarter and nine months of fiscal 2005, which ended May 28, 2005. A copy of the Press Release is attached as Exhibit 99 to this Current Report and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
| EXHIBIT NO. |
DESCRIPTION |
|---|---|
| 99 | Press release dated June 29, 2005 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
UNIFIRST CORPORATION
| Date: June 29, 2005 | By: /s/ Ronald D. Croatti Name: Ronald D. Croatti Title: Chairman of the Board, Chief Executive Officer and President |
| By: /s/ John B. Bartlett Name: John B. Bartlett Title: Senior Vice President and Chief Financial Officer |
EXHIBIT INDEX
| EXHIBIT NO. |
DESCRIPTION |
|---|---|
| 99 | Press release dated June 29, 2005 |
Exhibit 99
| UniFirst Corporation | News Release |
|---|---|
| 68 Jonspin Road Wilmington, MA 01887-1086 Telephone 978-658-8888 Ext 520 Facsimile 978-988-0659 |
contact: John B. Bartlett Senior Vice President jbartlett@unifirst.com |
UNIFIRST ANNOUNCES
RECORD FINANCIAL RESULTS
FOR THIRD QUARTER AND
NINE MONTHS OF FISCAL 2005
Wilmington, MA (June 29, 2005) — UniFirst Corporation (NYSE: UNF) today announced its revenues and earnings for the third quarter and nine months of fiscal 2005, which ended May 28, 2005.
Third quarter net income was $11.8 million ($0.61 per diluted common share), an 18.7% percent increase from last year’s $9.9 million ($0.52 per diluted common share). Revenues for the third quarter of fiscal 2005 were $196.0 million, a 7.1% percent increase from $183.0 million in the same period a year ago.
For the first three quarters of fiscal 2005, net income was $35.2 million ($1.82 per diluted common share), a 35.2% increase from last year’s $26.1 million ($1.35 per diluted common share). Revenues were $575.1 million, a 6.2% increase from $541.3 million for the first three quarters of fiscal 2004.
The Company benefited in the third quarter of fiscal 2005 from higher revenues and profits from its UniTech business. Another reason for the significant increase in net income in the third quarter and the first three quarters of fiscal 2005 compared to fiscal 2004 continues to be a decrease in operating costs as a percentage of revenues. As a percentage of revenues, operating costs for the third quarter decreased 1.2 percentage points from 63.5% for fiscal 2004 to 62.3% for fiscal 2005 and decreased for the first nine months of the year by 1.5 percentage points from 64.1% for fiscal 2004 to 62.6% for fiscal 2005. This decrease was due to lower merchandise amortization for the locations acquired as part of the Textilease acquisition as well as from cost savings realized from the Company’s manufacturing operations in Mexico and lower industrial laundry production payroll costs as a percentage of revenues. Lower merchandise amortization for locations acquired as part of the Textilease acquisition was less of a benefit in the third quarter of fiscal 2005 than it was in the first six months.
These benefits were somewhat offset by higher energy costs associated with operating industrial laundries as well as in utilizing our fleet of delivery vehicles and an increase in selling payroll costs as the Company has increased its sales force in fiscal 2005.
The Company also continues to benefit from lower depreciation and intangible asset amortization expenses due to certain fixed assets and certain intangible assets becoming fully depreciated and amortized in fiscal 2004. This decrease in depreciation is also due to a $600 thousand pre-tax charge to depreciation taken in the third quarter of fiscal 2004 related to the Company’s decision to close its Richmond facility. In addition, decreased interest expense, on a net basis, continues to benefit fiscal 2005 as compared to fiscal 2004 primarily due to the reduction in the average level of debt outstanding.
The Company will hold a conference call today at 4:00 PM (EST) to discuss its quarterly financial results, business highlights and outlook. A simultaneous live webcast of the call will be available over the Internet and can be accessed at www.unifirst.com.
UniFirst is one of the largest providers of workplace uniforms, protective clothing and facility services products in North America. The Company employs 9,000 team partners who serve more than 175,000 customer locations in 46 states, Canada and Europe from 175 manufacturing, distribution and customer service facilities.
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for certain forward-looking statements. This public announcement may contain forward-looking statements that reflect the Company’s current views with respect to future events and financial performance. These forward-looking statements are subject to certain risks and uncertainties. The words “anticipate” and “should,” and other expressions that indicate future events and trends identify forward-looking statements. Actual future results may differ materially from those anticipated depending on a variety of factors, including, but not limited to, performance of acquisitions; economic and business changes; fluctuations in the cost of materials, fuel and labor; economic and other developments associated with the on-going war on terrorism; strikes and unemployment levels; demand and price for the Company’s products and services; improvement in under performing rental operations; and the outcome of pending and future litigation and environmental matters.
[Tables follow]
UNIFIRST CORPORATION AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| (In thousands) |
May 28, 2005 |
August 28, 2004 (a) | ||||||
|---|---|---|---|---|---|---|---|---|
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 5,671 | $ | 4,436 | ||||
| Receivables, net | 82,540 | 69,471 | ||||||
| Inventories | 24,367 | 31,060 | ||||||
| Rental merchandise in service | 70,324 | 60,544 | ||||||
| Prepaid taxes and deferred tax assets | 4,184 | 2,753 | ||||||
| Prepaid expenses | 2,596 | 1,857 | ||||||
| Total current assets | 189,682 | 170,121 | ||||||
| Property and equipment: | ||||||||
| Land, buildings and leasehold improvements | 255,957 | 240,018 | ||||||
| Machinery and equipment | 272,022 | 258,736 | ||||||
| Motor vehicles | 75,828 | 70,048 | ||||||
| 603,807 | 568,802 | |||||||
| Less - accumulated depreciation | 300,653 | 280,012 | ||||||
| 303,154 | 288,790 | |||||||
| Goodwill | 185,805 | 180,685 | ||||||
| Customer contracts and intangible assets, net | 56,526 | 57,873 | ||||||
| Other assets | 3,812 | 3,353 | ||||||
| $ | 738,979 | $ | 700,822 | |||||
| Liabilities and Shareholders' Equity | ||||||||
| Current liabilities: | ||||||||
| Current maturities of long-term obligations | $ | 1,004 | $ | 986 | ||||
| Accounts payable | 36,617 | 33,754 | ||||||
| Accrued liabilities | 75,410 | 72,824 | ||||||
| Accrued and deferred income taxes | 2,841 | 5,611 | ||||||
| Total current liabilities | 115,872 | 113,175 | ||||||
| Long-term obligations, net of current maturities | 178,133 | 177,855 | ||||||
| Deferred income taxes | 42,067 | 42,043 | ||||||
| Shareholders' equity: | ||||||||
| Common stock | 947 | 928 | ||||||
| Class B common stock | 975 | 993 | ||||||
| Capital surplus | 13,428 | 13,138 | ||||||
| Retained earnings | 386,473 | 353,196 | ||||||
| Accumulated other comprehensive income (loss) | 1,084 | (506 | ) | |||||
| Total shareholders' equity | 402,907 | 367,749 | ||||||
| $ | 738,979 | $ | 700,822 | |||||
(a) Condensed from audited financial statements.
UNIFIRST CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
| (In thousands, except per share data) |
Thirty-nine weeks ended May 28, 2005 |
Thirty-nine weeks ended May 29, 2004 |
Thirteen weeks ended May 28, 2005 |
Thirteen weeks ended May 29, 2004 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenues | $ | 575,075 | $ | 541,290 | $ | 195,957 | $ | 182,985 | ||||||
| Costs and expenses: | ||||||||||||||
| Operating costs (1) | 359,940 | 347,024 | 121,985 | 116,223 | ||||||||||
| Selling and administrative expenses (1) | 120,528 | 110,611 | 41,927 | 36,750 | ||||||||||
| Depreciation and amortization | 32,872 | 34,389 | 11,142 | 11,662 | ||||||||||
| 513,340 | 492,024 | 175,054 | 164,635 | |||||||||||
| Income from operations | 61,735 | 49,266 | 20,903 | 18,350 | ||||||||||
| Other expense (income): | ||||||||||||||
| Interest expense | 6,487 | 9,135 | 2,232 | 2,891 | ||||||||||
| Interest income | (1,336 | ) | (785 | ) | (366 | ) | (154 | ) | ||||||
| Interest rate swap income | (223 | ) | (1,454 | ) | -- | (554 | ) | |||||||
| Other expense | 4,928 | 6,896 | 1,866 | 2,183 | ||||||||||
| Income before income taxes | 56,807 | 42,370 | 19,037 | 16,167 | ||||||||||
| Provision for income taxes | 21,588 | 16,312 | 7,235 | 6,224 | ||||||||||
| Net income | $ | 35,219 | $ | 26,058 | $ | 11,802 | $ | 9,943 | ||||||
| Weighted average number of shares outstanding: | ||||||||||||||
| Basic-Common Stock | 9,401 | 9,052 | 9,467 | 9,127 | ||||||||||
| Basic-Class B Common Stock | 9,814 | 10,139 | 9,758 | 10,073 | ||||||||||
| Dilutive effect of common stock options | 89 | 62 | 111 | 71 | ||||||||||
| Diluted-Common Stock | 19,304 | 19,253 | 19,336 | 19,271 | ||||||||||
| Net income per share: | ||||||||||||||
| Basic-Common Stock | $ | 2.04 | $ | 1.52 | $ | 0.68 | $ | 0.58 | ||||||
| Basic-Class B Common Stock | 1.63 | 1.21 | 0.55 | 0.46 | ||||||||||
| Diluted-Common Stock | 1.82 | 1.35 | 0.61 | 0.52 | ||||||||||
| Dividends per share: | ||||||||||||||
| Common Stock | $ | 0.1125 | $ | 0.1125 | $ | 0.0375 | $ | 0.0375 | ||||||
| Class B Common Stock | 0.0900 | 0.0900 | 0.0300 | 0.0300 | ||||||||||
(1) Exclusive of depreciation and amortization