UniFirst Announces Financial Results for the Third Quarter of Fiscal 2025

WILMINGTON, Mass., July 02, 2025 (GLOBE NEWSWIRE) -- UniFirst Corporation (NYSE:UNF) (the "Company," "UniFirst" or "we") today reported results for its third quarter ended May 31, 2025 as compared to the corresponding period in the prior fiscal year:

Q3 2025 Financial Highlights

Consolidated revenues for the third quarter increased 1.2% to $610.8 million.

Operating income was $48.2 million, a decrease of 0.6%.

The quarterly tax rate increased to 25.7% compared to 22.9% in the prior year.

Net income increased to $39.7 million from $38.1 million in the prior year, or 4.3%.

Diluted earnings per share increased to $2.13 from $2.03 in the prior year, or 4.9%.

Adjusted EBITDA increased to $85.8 million compared to $84.8 million in the prior year, or 1.2%.

The Company's financial results for the third quarter of fiscal 2025 and 2024 included approximately $1.0 million and $3.9 million, respectively, of costs directly attributable to its customer relationship management ("CRM") computer system and enterprise resource planning ("ERP") projects. The Company refers to the CRM and ERP projects together as its "Key Initiatives". The effect of these items on the third quarter of fiscal 2025 and 2024 combined to decrease:

Operating income and Adjusted EBITDA by $1.0 million and $3.9 million, respectively.

Net income by $0.7 million and $2.9 million, respectively.

Diluted earnings per share by $0.04 and $0.16, respectively.

Net income and diluted earnings per share also benefited from a $2.8 million gain on the sale of a non-operating property during the quarter. This gain was recorded to other (income) expense, net, but was excluded from Adjusted EBITDA.

Steven Sintros, UniFirst President and Chief Executive Officer, said, "The results for our third quarter were largely in line with our expectations. It is rewarding to see our recent investments beginning to yield measurable returns, evidenced by gross margin improvement and more effective execution across the business. I want to sincerely thank all of our Team Partners who continue to Always Deliver for each other and our customers as we strive towards our vision of being universally recognized as the best service provider in the industry. …all while living our mission of Serving the People Who do the Hard Work."

Segment Reporting Highlights

Core Laundry Operations

Revenues for the quarter increased 0.9% to $533.2 million.

Organic growth, which excludes the effect of acquisitions and fluctuations in the Canadian dollar, was 1.1%.

Operating margin decreased to 6.9% from 7.0%.

Adjusted Core Laundry Operations' EBITDA margin was unchanged at 13.5%.

The costs we incurred related to the Key Initiatives were recorded to the Core Laundry Operations' segment, and decreased both the Core Laundry Operations' operating and Adjusted EBITDA margins for the third quarters of fiscal 2025 and 2024 by 0.2% and 0.7%, respectively.

The segment's operating and Adjusted EBITDA margins in the third quarter of fiscal 2025 were relatively consistent with the third quarter of the prior fiscal year. Both margin comparisons to the prior year continued to benefit from lower merchandise and production costs as a percentage of revenue but were offset by higher healthcare claims expense and approximately $5.7 million of expense related to advisory costs for a strategic matter and legal costs related to an employee matter in the third quarter of fiscal 2025.

Balance Sheet and Capital Allocation

Cash, cash equivalents and short-term investments totaled $211.9 million as of May 31, 2025.

Cash flows from operating activities were $196.5 million in the first nine months of fiscal 2025.

The Company repurchased $13.6 million of shares of Common Stock in the third quarter of fiscal 2025 and as of May 31, 2025 had $86.4 million remaining under its existing share repurchase authorization.

Financial Outlook

Mr. Sintros continued, "We are currently maintaining our annual revenue guidance within the range of $2.422 billion to $2.432 billion. However, we are raising our diluted earnings per share guidance to a range of $7.60 to $8.00. This adjustment reflects an updated assumption that our Key Initiative costs in fiscal 2025 will be approximately $7.5 million, revised from our previous estimate."

Please remember that fiscal year 2025 will consist of one less week of operations compared to fiscal year 2024, which included an additional week in its fourth fiscal quarter. Also, the guidance does not assume future share buybacks or unforeseen economic events.

Conference Call Information

UniFirst Corporation will hold a conference call today at 9:00 a.m. (ET) 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.

About UniFirst Corporation

Headquartered in Wilmington, Mass., UniFirst Corporation (NYSE:UNF) is a North American leader in the supply and servicing of uniform and workwear programs, facility service products, as well as first aid and safety supplies and services. Together with its subsidiaries, the Company also manages specialized garment programs for the cleanroom and nuclear industries. In addition to partnering with leading brands, UniFirst manufactures its own branded workwear, protective clothing, and floorcare products at its five company-owned ISO-9001-certified manufacturing facilities. With more than 270 service locations, over 300,000 customer locations, and 16,000-plus employee Team Partners, the Company outfits more than 2 million workers every day. For more information, contact UniFirst at 888.296.2740 or visit UniFirst.com.

Forward-Looking Statements Disclosure

This public announcement contains forward-looking statements within the meaning of the federal securities laws that reflect the Company's current views with respect to future events and financial performance, including projected revenues, operating margin and earnings per share. Forward-looking statements contained in this public announcement are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995 and may be identified by words such as "guidance," "outlook," "estimates," "anticipates," "projects," "plans," "expects," "intends," "believes," "seeks," "could," "should," "may," "will," "strategy," "objective," "assume," "strive," "design," "assumption," "vision," "approximate," or the negative versions thereof, and similar expressions and by the context in which they are used. Such forward-looking statements are based upon our current expectations and speak only as of the date made. Such statements are highly dependent upon a variety of risks, uncertainties and other important factors that could cause actual results to differ materially from those reflected in such forward-looking statements. Such factors include, but are not limited to, uncertainties caused by an economic recession or other adverse economic conditions, including, without limitation, as a result of elevated inflation or interest rates or extraordinary events or circumstances such as geopolitical conflicts like the conflict between Russia and Ukraine and disruption in the Middle East, and their impact on our customers' businesses and workforce levels, disruptions of our business and operations, including limitations on, or closures of, our facilities, or the business and operations of our customers or suppliers in connection with extraordinary events or circumstances uncertainties regarding our ability to consummate acquisitions and successfully integrate acquired businesses, and the performance of such businesses, uncertainties regarding any existing or newly-discovered expenses and liabilities related to environmental compliance and remediation, any adverse outcome of pending or future contingencies or claims, our ability to compete successfully without any significant degradation in our margin rates, seasonal and quarterly fluctuations in business levels, our ability to preserve positive labor relationships and avoid becoming the target of corporate labor unionization campaigns that could disrupt our business, the effect of currency fluctuations on our results of operations and financial condition, our dependence on third parties to supply us with raw materials, which such supply could be severely disrupted as a result of extraordinary events or circumstances such as the conflict between Russia and Ukraine, any loss of key management or other personnel, increased costs as a result of any changes in federal, state, international or other laws, rules and regulations or governmental interpretation of such laws, rules and regulations, uncertainties regarding, or adverse impacts from continued high price levels of natural gas, electricity, fuel and labor or increases in such costs, the negative effect on our business from sharply depressed oil and natural gas prices, the continuing increase in domestic healthcare costs, increased workers' compensation claim costs, increased healthcare claim costs, our ability to retain and grow our customer base, demand and prices for our products and services, fluctuations in our Specialty Garments business, political or other instability, supply chain disruption or infection among our employees in Mexico and Nicaragua where our principal garment manufacturing plants are located, our ability to properly and efficiently design, construct, implement and operate a new enterprise resource planning computer system, interruptions or failures of our information technology systems, including as a result of cyber-attacks, additional professional and internal costs necessary for compliance with any changes in or additional Securities and Exchange Commission (the "SEC"), New York Stock Exchange and accounting or other rules, strikes and unemployment levels, our efforts to evaluate and potentially reduce internal costs, the impact of foreign trade policies and tariffs or other impositions on imported goods on our business, results of operations and financial condition, our ability to successfully implement our business strategies and processes, including our capital allocation strategies, our ability to successfully remediate the material weaknesses in internal control over financial reporting disclosed in our Annual Report on Form 10-K for the year ended August 31, 2024 and the other factors described under Part I, Item 1A. "Risk Factors" and elsewhere in our Annual Report on Form 10-K for the year ended August 31, 2024, Part II, Item 1A. "Risk Factors" and elsewhere in our subsequent Quarterly Reports on Form 10-Q and in our other filings with the SEC. We undertake no obligation to update any forward-looking statements to reflect events or circumstances arising after the date on which they are made.

Consolidated Statements of Income(Unaudited)

 

 

Thirteen Weeks Ended

 

 

Thirty-Nine Weeks Ended

 

(In thousands, except per share data)

 

May 31, 2025

 

 

May 25, 2024

 

 

May 31, 2025

 

 

May 25, 2024

 

Revenues

 

$

610,778

 

 

$

603,328

 

 

$

1,817,905

 

 

$

1,787,564

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues (1)

 

 

385,189

 

 

 

391,244

 

 

 

1,160,388

 

 

 

1,171,231

 

Selling and administrative expenses (1)

 

 

142,690

 

 

 

129,074

 

 

 

418,119

 

 

 

383,350

 

Depreciation and amortization

 

 

34,722

 

 

 

34,560

 

 

 

104,476

 

 

 

103,453

 

Total operating expenses

 

 

562,601

 

 

 

554,878

 

 

 

1,682,983

 

 

 

1,658,034

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

48,177

 

 

 

48,450

 

 

 

134,922

 

 

 

129,530

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other (income) expense:

 

 

 

 

 

 

 

 

 

 

 

 

Interest income, net

 

 

(2,514

)

 

 

(1,406

)

 

 

(7,422

)

 

 

(4,590

)

Other (income) expense, net

 

 

(2,704

)

 

 

522

 

 

 

(1,620

)

 

 

1,813

 

Total other income, net

 

 

(5,218

)

 

 

(884

)

 

 

(9,042

)

 

 

(2,777

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

53,395

 

 

 

49,334

 

 

 

143,964

 

 

 

132,307

 

Provision for income taxes

 

 

13,715

 

 

 

11,277

 

 

 

36,720

 

 

 

31,468

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

39,680

 

 

$

38,057

 

 

$

107,244

 

 

$

100,839

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income per share, Basic:

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

$

2.22

 

 

$

2.12

 

 

$

6.01

 

 

$

5.61

 

Class B Common Stock

 

$

1.78

 

 

$

1.70

 

 

$

4.80

 

 

$

4.49

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income per share, Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

$

2.13

 

 

$

2.03

 

 

$

5.76

 

 

$

5.38

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income allocated to, Basic:

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

$

33,346

 

 

$

31,962

 

 

$

90,126

 

 

$

84,716

 

Class B Common Stock

 

$

6,334

 

 

$

6,095

 

 

$

17,118

 

 

$

16,123

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income allocated to, Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

$

39,680

 

 

$

38,057

 

 

$

107,244

 

 

$

100,839

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding, Basic:

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

14,990

 

 

 

15,062

 

 

 

15,007

 

 

 

15,094

 

Class B Common Stock

 

 

3,557

 

 

 

3,590

 

 

 

3,563

 

 

 

3,590

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding, Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

18,607

 

 

 

18,705

 

 

 

18,633

 

 

 

18,738

 

 

(1) Exclusive of depreciation on the Company's property, plant and equipment and amortization on its intangible assets.

Condensed Consolidated Balance Sheets(Unaudited)

(In thousands)

 

May 31, 2025

 

 

August 31, 2024

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

211,910

 

 

$

161,571

 

Short-term investments

 

 

—

 

 

 

13,505

 

Receivables, net

 

 

281,815

 

 

 

278,851

 

Inventories

 

 

148,847

 

 

 

156,908

 

Rental merchandise in service

 

 

227,580

 

 

 

237,969