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Goodwill, Service Contracts and Other Assets

3 Months Ended

Aug. 31, 2011

Goodwill, Service Contracts and Other Assets

Goodwill, Service Contracts and Other Assets

5. Goodwill, Service Contracts and Other Assets

Changes in the carrying amount of goodwill and service contracts for the three months ended August 31, 2011, by operating segment, are as follows:

	Rental		First Aid,
	Uniforms &	Uniform	Safety &
	Ancillary	Direct	Fire	Document
	Products	Sales	Protection	Management	Total
Goodwill (in thousands)
Balance as of June 1, 2011	$943,177	$23,995	$192,944	$327,766	$1,487,882

Goodwill acquired	—	—	—	182	182

Foreign currency translation	(24)	10	—	102	88

Balance as of August 31, 2011	$943,153	$24,005	$192,944	$328,050	$1,488,152

	Rental		First Aid,
	Uniforms &	Uniform	Safety &
	Ancillary	Direct	Fire	Document
	Products	Sales	Protection	Management	Total
Service Contracts (in thousands)
Balance as of June 1, 2011	$ 44,628	$ —	$ 35,878	$ 21,806	$ 102,312

Service contracts acquired	—	—	—	366	366

Service contracts amortization	(4,268)	—	(1,846)	(2,107)	(8,221)

Foreign currency translation	(32)	—	—	6	(26)

Balance as of August 31, 2011	$ 40,328	$ —	$ 34,032	$ 20,071	$ 94,431

Information regarding Cintas’ service contracts and other assets is as follows:

	As of August 31, 2011
		Carrying	Accumulated
(In thousands)		Amount	Amortization	Net

Service contracts		$380,302	$285,871	$ 94,431
Noncompete and consulting agreements		$ 76,387	$ 65,982	$ 10,405
Investments(1)		87,924	—	87,924
Other		23,007	5,108	17,899

Total		$187,318	$ 71,090	$116,228

	As of May 31, 2011
		Carrying	Accumulated
(In thousands)		Amount	Amortization	Net

Service contracts		$379,967	$277,655	$102,312
Noncompete and consulting agreements		$ 76,091	$ 63,982	$ 12,109
Investments(1)		84,197	—	84,197
Other		23,135	4,690	18,445

Total		$183,423	$ 68,672	$ 114,751

(1) Investments at August 31, 2011, include the cash surrender value of insurance policies of $54.1 million, equity method investments of $30.9 million and cost method investments of $2.9 million. Investments at May 31, 2011, include the cash surrender value of insurance policies of $51.1 million, equity method investments of $30.2 million and cost method investments of $2.9 million.

Amortization expense was $10.2 million and $10.4 million for the three months ended August 31, 2011 and 2010, respectively. Estimated amortization expense, excluding any future acquisitions, for each of the next five years is $38.0 million, $21.0 million, $17.5 million, $14.7 million and $9.5 million, respectively.

Investments recorded using the cost method are evaluated for impairment on an annual basis or when indicators of impairment are identified. For the three months ended August 31, 2011 and 2010, no losses due to impairment were recorded.