Uniform retailer Cintas raises annual forecasts on resilient demand

Sept 24 (Reuters) - Cintas CTAS.O on Wednesday raised its annual revenue and profit forecast on expectations that demand for its products such as rental uniforms and first-aid supplies will be resilient in the face of persistent inflation.

While U.S. job growth weakened sharply in August, sectors such as healthcare, education, leisure and hospitality saw persistent hiring, according to Labor Department's Bureau of Labor Statistics report. This is seen helping companies such as Cintas, which have about 70% of its customer base in such sectors.

The company now expects its fiscal 2026 total revenue to be in the range of $11.06 billion to $11.18 billion, compared with prior forecast of $11 billion to $11.15 billion.

Cintas also expects annual profit per share to be in the range of $4.74 to $4.86, up from a prior range of $4.71 to $4.85. The midpoint of the updated forecast, however, came in below the average of analysts' estimates of $4.85, according to data compiled by LSEG.

Shares of the company were down about 2% in early trading.

Cintas, which provides a diverse portfolio of products and services, including shop towels, fire extinguishers, and flame-resistant apparel, has seen sales rise as businesses view cleanliness, branding and safety as essential.

Rising demand for its workplace safety products such as defibrillators, eye-wash stations, and hydration units further helped in boosting sales in its First Aid and Safety Services segment.

The company's first-quarter revenue rose 8.7% to $2.72 billion, above analysts' estimates of $2.69 billion.

The uniform retailer reported an 8.2% increase in cost of sales, driven by higher material and labor expenses.

It earned $1.20 per share in the quarter ended August 31, edging past analysts' estimates of $1.19 per share.