XML 29 R15.htm IDEA: XBRL DOCUMENT
v3.7.0.1

Debt and Derivatives | 12 Months Ended
--- | ---
May 31, 2017
Debt Disclosure [Abstract] |
Debt and Derivatives | Debt and Derivatives Cintas' debt is summarized as follows at May 31:
(In thousands) | Interest Rate |  | Fiscal Year Issued |  | Fiscal Year Maturity |  | 2017 |  | 2016
Debt due within one year |  |  |  |  |  |  |  |  |
Senior notes | 2.85 | % |  | 2007 |  | 2017 |  | $ | — |  |  | $ | 250,000 |
Senior notes | 6.13 | % |  | 2008 |  | 2018 |  | 300,000 |  |  | — |
Commercial paper | 1.24 | % | (1) | Various |  | Various |  | 50,500 |  |  | — |
Current portion of term loan | 2.00 | % | (1) | 2017 |  | 2018 |  | 12,500 |  |  | — |
Debt issuance costs |  |  |  |  |  |  | (100 | ) |  | — |
Total debt due within one year |  |  |  |  |  |  | $ | 362,900 |  |  | $ | 250,000 |
Debt due after one year |  |  |  |  |  |  |  |  |
Senior notes | 6.13 | % |  | 2008 |  | 2018 |  | $ | — |  |  | $ | 300,000 |
Senior notes | 4.30 | % |  | 2012 |  | 2022 |  | 250,000 |  |  | 250,000 |
Senior notes | 2.90 | % |  | 2017 |  | 2022 |  | 650,000 |  |  | — |
Senior notes | 3.25 | % |  | 2013 |  | 2023 |  | 300,000 |  |  | 250,000 |
Senior notes (2) | 2.78 | % |  | 2013 |  | 2023 |  | 52,554 |  |  | — |
Senior notes (3) | 3.11 | % |  | 2015 |  | 2025 |  | 52,645 |  |  | — |
Senior notes | 3.70 | % |  | 2017 |  | 2027 |  | 1,000,000 |  |  | — |
Senior notes | 6.15 | % |  | 2007 |  | 2037 |  | 250,000 |  |  | 250,000 |
Long-term portion of term loan | 2.00 | % | (1) | 2017 |  | 2022 |  | 237,500 |  |  | — |
Debt issuance costs |  |  |  |  |  |  | (22,075 | ) |  | (5,578 | )
Total debt due after one year |  |  |  |  |  |  | $ | 2,770,624 |  |  | $ | 1,044,422 |
(1) Variable rate debt instrument. The rate presented is the variable borrowing rate at May 31, 2017. (2) Cintas assumed these senior notes with the acquisition of G&K, and they were recorded at fair value. The interest rate shown above is the effective interest rate. The principal amount of these notes is $50.0 million with a stated interest rate of 3.73%. (3) Cintas assumed these senior notes with the acquisition of G&K, and they were recorded at fair value. The interest rate shown above is the effective interest rate. The principal amount of these notes is $50.0 million with a stated interest rate of 3.88%. The average interest rate for all Cintas debt at May 31, 2017 was 3.8% with maturity dates through fiscal year 2037. Cintas' senior notes, excluding the G&K senior notes assumed with the acquisition of G&K, and term loan are recorded at cost, net of debt issuance costs. The fair value of the long-term debt is estimated using Level 2 inputs based on general market prices. The carrying value and fair value of Cintas' debt as of May 31, 2017 were $3,156.0 million and $3,296.8 million, respectively, and as of May 31, 2016 were $1,300.0 million and $1,416.6 million, respectively. On June 1, 2016, Cintas paid the $250.0 million five-year senior notes that matured on that date with cash on hand and $218.5 million proceeds from the issuance of commercial paper. In June and July 2017, Cintas paid a total of $50.5 million of commercial paper and $150.0 million of the term loan with cash on hand. Letters of credit outstanding were $110.9 million and $83.4 million at May 31, 2017 and 2016, respectively. Maturities of debt during each of the next five years are $363.0 million, $12.5 million, $12.5 million, $12.5 million and $1,100.0 million, respectively. Interest paid was $76.6 million, $64.5 million and $65.3 million for the fiscal years ended May 31, 2017, 2016 and 2015, respectively. Interest paid in fiscal 2017 included the payment of $17.1 million in short-term debt financing fees, which were related to the acquisition of G&K and are not reoccurring The credit agreement that supports our commercial paper program was amended on September 16, 2016. The amendment increased the capacity of the revolving credit facility from $450.0 million to $600.0 million and added a $250.0 million term loan. The $150.0 million increase in the revolving credit facility took effect upon the consummation of the merger (Merger) contemplated by the merger agreement (Merger Agreement) among the Company, G&K and Bravo Merger Sub, Inc. (Merger Sub), a wholly-owned subsidiary of Cintas. The term loan was funded upon the consummation of the Merger. The credit agreement has an accordion feature that provides Cintas the ability to request increases to the borrowing commitments under either the revolving credit facility or the term loan facility of up to $250.0 million in the aggregate, subject to customary conditions. The maturity date of the agreement is September 15, 2021. As of May 31, 2017, there was $50.5 million of commercial paper outstanding with a weighted average interest rate of 1.24% and maturity dates less than 30 days and no borrowings on our revolving credit facility. The fair value of the commercial paper is estimated using Level 2 inputs based on general market prices. Given its short-term nature, the carrying value of the outstanding commercial paper approximates fair value. No commercial paper or borrowings on our revolving credit facility were outstanding at May 31, 2016. Cintas uses interest rate locks to manage its overall interest expense as interest rate locks effectively change the interest rate of specific debt issuances. The interest rate locks are entered into to protect against unfavorable movements in the benchmark treasury rate related to forecasted debt issuances. Cintas used interest rate lock agreements to hedge against movements in the treasury rates at the time Cintas issued its senior notes in fiscal 2007, fiscal 2008, fiscal 2011, fiscal 2013 and fiscal 2017. The amortization of the cash flow hedges resulted in an increase to other comprehensive income of $1.1 million, $2.0 million and $2.0 million in the fiscal years ended May 31, 2017, 2016 and 2015, respectively. During the third quarter of fiscal 2016, Cintas entered into an interest rate lock agreement with a notional value of $550.0 million for a forecasted debt issuance. As of May 31, 2016, the fair value of this treasury lock was a liability of $19.6 million recorded in long-term liabilities and other comprehensive income, net of tax. The interest rate locks had no impact on net income or cash flows from continuing operations for fiscal 2016. As of the third quarter of fiscal 2017, Cintas had multiple interest rate lock agreements in place for forecasted long-term debt issuances. The notional value of the planned debt issuances was $500.0 million of 5-year senior notes and $1.0 billion of 10-year senior notes. In conjunction with the issuance of long-term debt in the fourth quarter of fiscal 2017, Cintas settled these interest rate lock agreements, which resulted in a deferred gain of $30.2 million. The effective portion of the gain was recorded in other comprehensive income to be amortized as a reduction to interest expense beginning in the fourth quarter of fiscal 2017 through the remaining life of the debt. To hedge the exposure of movements in the foreign currency rates, Cintas may use foreign currency hedges. These hedges reduce the impact on cash flows from movements in the foreign currency exchange rates. Examples of foreign currency hedge instruments that Cintas may use are average rate options and forward contracts. These instruments did not impact foreign currency exchange during fiscal 2017, 2016 or 2015. Cintas had no foreign currency forward contracts as of May 31, 2017 or 2016. Cintas has certain covenants related to debt agreements. These covenants limit Cintas' ability to incur certain liens, to engage in sale-leaseback transactions and to merge, consolidate or sell all or substantially all of Cintas' assets. These covenants also require Cintas to maintain certain debt to consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) and interest coverage ratios. Cross-default provisions exist between certain debt instruments. If a default of a significant covenant were to occur, the default could result in an acceleration of the maturity of the indebtedness, impair liquidity and limit the ability to raise future capital. Cintas was in compliance with all of the debt covenants for all periods presented.

X
- Definition Information about whether or not the entity is in compliance with debt covenants and the effects of noncompliance with debt covenants; and the entity's entire derivative instruments and hedging activities disclosure as a single block of text which describes an entity's risk management strategies, derivatives in hedging activities and non-hedging derivative instruments, the assets, obligations, liabilities, revenues and expenses arising there from, and the amounts of and methodologies and assumptions used in determining the amounts of such items. + References No definition available. + Details
Name: | ctas_DebtDerivativesInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | ctas_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration