Earnings Review and Free Research Report: UniFirst’s Quarterly Revenue Grew 11.4%

LONDON, UK / ACCESSWIRE / July 10, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on UniFirst Corp. (NYSE: UNF), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=UNF, following the Company’s posting of its third quarter fiscal 2017 earnings results on June 28, 2017. The uniform provider exceeded top- and bottom-line expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member’s account at:

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At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on UNF. With the links below you can directly download the report of your stock of interest-free of charge at:

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Earnings Reviewed

For its third quarter of fiscal 2017 which ended on May 27, 2017, UniFirst’s revenues grew 11.4% to $409.8 million compared to $367.8 million in Q3 FY16. The Company’s revenue numbers topped analysts’ expectations of $396 million.

For Q3 FY17, UniFirst’s net income was $24.4 million, or $1.19 per diluted share, down 19.2% from $30.1 million, or $1.49 per diluted share, in Q3 FY16. The Company’s reported quarter’s results included the effect of UniFirst’s acquisition of Arrow Uniform (“Arrow”)which was completed in September 2016. The Company’s results also included $6.5 million of stock compensation expense related to the April 2016 restricted stock grant to its former Chief Executive Officer, Ronald Croatti, out of which $5.4 million was a result of the accelerated vesting of certain shares upon his death. Excluding the effect of the accelerated vesting, UniFirst’s adjusted net income for Q3 FY17 was $27.7 million, or $1.36 per diluted share, down 8.1% on a y-o-y basis. The Company’s results surpassed Wall Street’s expectations for earnings of $1.34 per share.

Segment Results

During Q3 FY17, UniFirst’s Core Laundry revenues were $367.09 million, up 10.8% compared to $331.22 million in Q3 FY16. Adjusting for the estimated effect of acquisitions as well as a weaker Canadian dollar compared to a year ago, Core Laundry revenues grew 4.8% on a y-o-y basis. The Company’s Core Laundry operating income adjusted to exclude the effect of the accelerated vesting of restricted stock, was $38.9 million in Q3 FY17, down 9.2% on a y-o-y basis, while its adjusted operating margin was 10.6% compared to 12.9% for the same period in the year-ago same period.The decline in operating margin was attributed to atypically high levels of claims for healthcare, workers’ compensation, and auto liability. In addition, the impact of the acquisition of Arrow, higher selling and administrative payroll costs, and higher energy costs also contributed to the margin decline.

For Q3 FY17, UniFirst’s revenues from its Specialty Garments’ segment, which consists of nuclear decontamination and cleanroom operations, surged 24.0% to $29.86 million compared to $24.08 million in Q3 FY16. The segment’s operating income was $4.2 million compared to $3.6 million in the prior year’s same quarter. The improvement in revenue and operating income was attributed to increased outage and project-based activity in this segment’s US and Canadian nuclear operations.

UniFirst’s First Aid segment reported revenues and operating income were $12.9 million and $1.1 million, respectively, in Q3 FY17 compared to $12.5 million and $1.6 million, respectively, for Q3 FY16. The segment expended approximately $3 million during the reported quarter on a small acquisition that increased its market presence and service area in the Atlanta, Georgia market.

Cash Matters

UniFirst continues to maintain a strong balance sheet with no long-term debt and significant cash balances. Excluding the $119.9 million cash purchase price paid for the Arrow’s acquisition, the Company’s cash and cash equivalents increased $68.8 million during the first nine months of fiscal 2017. As of May 27, 2017, UniFirst’s cash and cash equivalents were $312.7 million. The Company’s cash provided by operating activities year-to-date was $155.8 million, down $5.3 million from $161.1 million in the prior year’s comparable period.

Outlook

UniFirst’s management stated that based on the stronger than expected top-line results to date, it now expects FY17 revenues in the range of $1.573 billion and $1.580 billion. The Company also expects full year diluted earnings per share to be between $4.85 and $5.00.

Stock Performance

On Friday, July 07, 2017, the stock closed the trading session at $139.85, climbing 1.38% from its previous closing price of $137.95. A total volume of 50.10 thousand shares have exchanged hands. UniFirst’s stock price rallied 1.82% in the last three months, 3.55% in the past six months, and 24.51% in the previous twelve months. The stock is trading at a PE ratio of 25.73 and has a dividend yield of 0.11%. At Friday’s closing price, the stock’s net capitalization stands at $2.91 billion.

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