UNIFIRST CORP

Previous wording

For more information, refer to our Current Report on Form 8-K filed with the SEC on March 11, 2026 and Note 1, Summary of Significant Accounting Policies.

Current wording

For more information, refer to our Current Reports on Form 8-K filed with the SEC on March 11, 2026 and June 12, 2026 and Note 1, Summary of Significant Accounting Policies.

Previous wording

In general, we believe that our results of operations are not dependent on moderate changes in the inflation rate. Historically, we have been able to manage the impacts of more significant changes in inflation rates through our customer relationships, customer agreements that generally provide for price increases and continued focus on improvements in operational productivity. However, the inflationary environment in recent years had a negative impact on our margins, including increased energy costs for our vehicles and our plants, and increased wages in the labor markets in which we compete. While inflation has moderated recently, a period of sustained inflation could pressure our margins in future periods. Adverse economic conditions resulting from inflationary pressures, U.S. Federal Reserve actions, including elevated interest rates and/or increases in interest rates, geopolitical issues, U.S. and foreign tariffs or other impositions on imported goods or other causes are difficult to predict and may have a material adverse impact on our business, results of operations and financial condition.

Current wording

In general, we believe that our results of operations are not dependent on reasonable changes in the inflation rate. Historically, we have been able to manage the impacts of more significant changes in inflation rates through our customer relationships, customer agreements that generally provide for price increases and continued focus on improvements in operational productivity. However, the inflationary environment in recent years had a negative impact on our margins, including increased energy costs for our vehicles and our plants, and increased wages in the labor markets in which we compete. While inflation has moderated recently, a period of sustained inflation could pressure our margins in future periods. Adverse economic conditions resulting from inflationary pressures, U.S. Federal Reserve actions, including elevated interest rates and/or increases in interest rates, geopolitical issues, U.S. and foreign tariffs or other impositions on imported goods or other causes are difficult to predict and may have a material adverse impact on our business, results of operations and financial condition.

Previous wording

In fiscal 2022, we initiated a multiyear ERP project that we plan to continue through 2027, with early phases focused on master data management and finance capabilities followed by subsequent phases with a strong focus on supply chain and procurement automation and technology. We believe that this initiative will become the foundation of our systems technology footprint and will integrate and complement the capabilities of our other core systems. We expect the ERP system, and the new supply chain and procurement capabilities that it will provide to enable lower operating costs and contribute to the reduction of customer churn. Such benefits are expected to be delivered through enhanced inventory utilization and vendor management, improved response times to customer orders and more efficient back-end processes. As of February 28, 2026, we capitalized $57.8 million related to our ERP project. We refer to our ERP project as our “Key Initiative”.

Current wording

In fiscal 2022, we initiated a multi-year ERP project focused on modernizing our enterprise systems. Early phases focused on master data management and finance capabilities, with subsequent phases focused on supply chain and procurement automation and technology. We believe this initiative will become the foundation of our systems technology footprint and will integrate and complement the capabilities of our other core systems. We expect the ERP system, along with its enhanced supply chain and procurement capabilities, to reduce operating costs and contribute to lower customer churn. Such benefits are expected to be delivered through enhanced inventory utilization and vendor management, improved response times to customer orders and more efficient back-end processes. As of May 30, 2026, we capitalized $62.3 million related to our ERP project. We refer to our ERP project as our “Key Initiative”.

Previous wording

The increase in consolidated revenues of 3.4% during the thirteen weeks ended February 28, 2026 compared to the prior year comparable period was due primarily to growth in our Uniform & Facility Service Solutions of 3.2%. The increase in our Uniform & Facility Service Solutions was due to organic growth of 2.8%. The Uniform & Facility Service Solutions organic growth rate was primarily the result of solid new account sales and benefited from improved customer retention. The effect of the Canadian dollar exchange rate resulted in changes in our revenues of 0.3%.

Current wording

The increase in consolidated revenues of 3.9% during the thirteen weeks ended May 30, 2026, compared to the prior year comparable period was due primarily to growth in our Uniform & Facility Service Solutions of 3.9%. The increase in revenues in our Uniform & Facility Service Solutions was primarily due to organic growth of 3.6%, which was driven by solid new account sales and improved customer retention. The effect of the Canadian dollar exchange rate resulted in changes in our revenues of 0.2%.

Previous wording

In the thirteen weeks ended February 28, 2026, Other segment revenues were impacted by the continued wind-down of a large refurbishment project, as well as a lower number of reactor outages due to the cyclical nature of the nuclear business. Other segment results are often affected by seasonality and the timing and length of its customers’ power reactor outages as well as its project-based activities.

Current wording

In the thirteen weeks ended May 30, 2026, Other segment revenues increased 4.4% compared to the prior year comparable period due primarily to favorable foreign currency exchange rates and growth in our European operations. These favorable impacts were partially offset by the continued wind-down of a large refurbishment project. Results for the Other segment are often influenced by seasonality, the timing and duration of customer power reactor outages, and project-based activities.

Previous wording

The increase in the effective tax rate for the thirteen weeks ended February 28, 2026 as compared to the corresponding period in the prior year was due primarily to the timing and amount of excess tax benefits and deficiencies associated with employee share-based payments.

Current wording

The decrease in the effective tax rate for the thirteen weeks ended May 30, 2026 as compared to the corresponding period in the prior year was primarily due to provision-to-return adjustments associated with income tax credits recognized upon finalization of the prior-year U.S. federal income tax return. These adjustments reflect refinement of estimates used in the prior year tax provision and resulted in a benefit of approximately $3.1 million.

Previous wording

The increase in consolidated revenues of 3.0% during the twenty-six weeks ended February 28, 2026 compared to the prior year comparable period was due primarily to the growth in our Uniform & Facility Service Solutions segment of 2.8%. The increase in our Uniform & Facility Service Solutions segment was due to organic growth of 2.6%. The Uniform & Facility Service Solutions organic growth rate was primarily the result of solid new account sales and benefited from improved customer retention. The effect of the Canadian dollar exchange rate resulted in changes in our revenues of 0.1%.

Current wording

The increase in consolidated revenues of 3.3% during the thirty-nine weeks ended May 30, 2026 compared to the prior year comparable period was due primarily to the growth in our Uniform & Facility Service Solutions segment of 3.1%. The increase in revenues in our Uniform & Facility Service Solutions segment was primarily due to organic growth of 3.0%. The Uniform & Facility Service Solutions organic growth was driven by solid new account sales and improved customer retention. The effect of the Canadian dollar exchange rate resulted in changes in our revenues of 0.1%.

Previous wording

First Aid & Safety Solutions revenues in the twenty-six weeks ended February 28, 2026 increased 13.7% compared to the prior year comparable due primarily to double-digit growth in our van business.

Current wording

First Aid & Safety Solutions revenues in the thirty-nine weeks ended May 30, 2026 increased 10.0% compared to the prior year comparable due primarily to double-digit growth in our van business.

Previous wording

In the twenty-six weeks ended February 28, 2026, Other segment revenues were impacted by the wind-down of a large refurbishment project, as well as a lower number of reactor outages due to the cyclical nature of the nuclear business. Other segment results are often affected by seasonality and the timing and length of its customers’ power outages as well as its project-based activities.

Current wording

In the thirty-nine weeks ended May 30, 2026, Other segment revenues were relatively flat compared to the prior year comparable period. Favorable foreign currency exchange rates contributed positively to revenue; however, these benefits were largely offset by the wind-down of a large refurbishment project and a lower number of reactor outages due to the cyclical nature of the nuclear industry. Results for the Other segment are often influenced by seasonality, the timing and duration of customer outages, and project-based activities.

Previous wording

The increase in consolidated cost of revenues of 2.8% during the twenty-six weeks ended February 28, 2026 compared to the prior year comparable period was primarily attributable to investments in service staffing to drive continued improvement in our customer retention and higher healthcare claims expenses. These increases were partially offset by lower merchandise costs as a percentage of revenues compared to the prior year comparable period.

Current wording

The increase in consolidated cost of revenues of 3.1% during the thirty-nine weeks ended May 30, 2026 compared to the prior year comparable period was primarily attributable to investments in service staffing to drive continued improvement in our customer retention and higher healthcare claims expenses. These increases were partially offset by lower merchandise costs as a percentage of revenues compared to the prior year comparable period.

Previous wording

The increase in selling and administrative costs during the thirteen weeks ended February 28, 2026 compared to the prior year comparable period was due primarily to planned investments to accelerate growth and support our digital transformation. Our selling and administrative expenses in the current period were further impacted by (1) approximately $2.0 million in costs related to shareholder engagement and proxy-related matters in connection with our 2026 annual meeting of shareholders and the proposed merger with Cintas, and (2) legal expenses related to an employee matter of $2.5 million (referred to collectively as the “Strategic and Employee Matters”). In addition, our costs incurred related to our Key Initiative totaled $3.0 million during the period compared to $1.9 million during the prior year comparable period.

Current wording

The increase in selling and administrative costs of 15.1% during the thirty-nine weeks ended May 30, 2026 compared to the prior year comparable period was due primarily to approximately $20.7 million of Transaction-related Costs and $2.0 million of shareholder engagement and proxy-related costs incurred in connection with our 2026 Annual Meeting of Shareholders. The increase was further driven by higher payroll and selling-related expenses, healthcare claims expenses and investments to accelerate growth and support our digital transformation. Selling and administrative expenses in the current year were also impacted by increased costs associated with our Key Initiative, which totaled $10.5 million during the current year period compared to $5.4 million in the prior year comparable period.

Previous wording

Depreciation and amortization expense remained relatively consistent during the thirteen weeks ended February 28, 2026 compared to the prior year comparable period.

Current wording

Depreciation and amortization expense remained relatively consistent during the thirty-nine weeks ended May 30, 2026 compared to the prior year comparable period.

Previous wording

Other income, net during the twenty-six weeks ended February 28, 2026 decreased as compared to the prior year comparable period, primarily reflecting lower cash reserves and lower interest rates, which reduced interest income, along with higher bank fees.

Current wording

Other income, net during the thirty-nine weeks ended May 30, 2026 decreased as compared to the prior year comparable period, primarily due to $2.8 million in proceeds from the sale of a property during the prior year comparable period. Also, lower cash reserves and lower interest rates, which reduced interest income, contributed to the reduced other income, net.

Previous wording

Cash and cash equivalents, and short-term investments totaled $157.5 million as of February 28, 2026, a decrease of $51.7 million from $209.2 million as of August 30, 2025. The decrease in cash and cash equivalents and short-term investments was largely driven by our continued investment in our business with capital expenditures totaling $77.3 million, $32.7 million of share repurchases, $14.6 million of acquisitions and $12.5 million of dividend payments. These decreases were partially offset by $88.5 million of cash provided from operating activities during the twenty-six weeks ended February 28, 2026.

Current wording

Cash and cash equivalents, and short-term investments totaled $168.9 million as of May 30, 2026, a decrease of $40.3 million from $209.2 million as of August 30, 2025. The decrease in cash and cash equivalents and short-term investments was largely driven by our continued investment in our business with capital expenditures totaling $107.0 million, $32.7 million of share repurchases, $18.8 million of dividend payments and $15.8 million paid for acquisitions. These decreases were partially offset by $139.4 million of cash provided from operating activities during the thirty-nine weeks ended May 30, 2026.

Previous wording

Pursuant to the share repurchase program, we repurchased 194,100 shares of our Common Stock for an aggregate of approximately $31.7 million during the twenty-six weeks ended February 28, 2026. As of February 28, 2026, we had $8.9 million remaining to repurchase shares under the share repurchase program.

Current wording

Pursuant to the share repurchase program, we repurchased 194,100 shares of our Common Stock for an aggregate of approximately $31.7 million during the thirty-nine weeks ended May 30, 2026. As of May 30, 2026, we had $8.9 million remaining to repurchase shares under the share repurchase program.

Previous wording

Sources and uses of cash flows for the twenty-six weeks ended February 28, 2026 and March 1, 2025, respectively, are summarized as follows:

Current wording

Sources and uses of cash flows for the thirty-nine weeks ended May 30, 2026 and May 31, 2025, respectively, are summarized as follows:

Previous wording

The net cash provided by operating activities during the twenty-six weeks ended February 28, 2026 decreased compared to the prior year comparable period due primarily to unfavorable changes in rental merchandise in service of $18.6 million, accrued liabilities of $3.9 million, prepaid and accrued income taxes of $3.6 million and lower profitability.

Current wording

The net cash provided by operating activities during the thirty-nine weeks ended May 30, 2026 decreased compared to the prior year comparable period due primarily to unfavorable changes in rental merchandise in service of $19.7 million, inventories of $11.0 million, and lower profitability.

Previous wording

The unfavorable impact from rental merchandise in service was driven primarily by the installation of garments for several large customers during the twenty-six weeks ended February 28, 2026. The accrued liabilities were largely attributable to the timing of disbursements. The decrease in prepaid and accrued income taxes reflects federal and state tax payments made during the first half of fiscal 2026.

Current wording

The unfavorable impact from rental merchandise in service was driven primarily by the installation of garments for several large customers during the thirty-nine weeks ended May 30, 2026. The increase in inventories was driven primarily by the timing of shipments.

Previous wording

In addition, operating cash flow was negatively impacted by a $2.9 million increase in prepaid expenses and other current assets and a $1.0 million increase in accounts receivable comparable to the prior year period. The increase in prepaid expenses and other current assets was driven primarily by higher prepayments for annual renewals of information technology contracts and insurance policies, while the increase in accounts receivable was due primarily to higher revenue volumes.

Current wording

In addition, operating cash flow was negatively impacted by a $7.0 million increase in accounts receivable comparable to the prior year period. The increase in accounts receivable was due primarily to higher revenue volumes.

Previous wording

These impacts were partially offset by a $2.7 million increase in accounts payable, primarily due to the timing of cash payments and a $0.7 million decrease in inventories, driven by the timing of shipments.

Current wording

These unfavorable impacts were partially offset by a $10.8 million increase in accounts payable and a $4.0 million increase in accrued liabilities, both due primarily to the timing of cash payments.

Previous wording

The net cash used in investing activities during the twenty-six weeks ended February 28, 2026 increased as compared to the prior year comparable period due primarily toan increasein capital expenditures of $11.2 million, an increase in cash paid for acquisitions, of $9.3 million, which includes the settlement of $0.5 million in acquisition-related holdbacks from prior period transactions and increased net investment in certificates of deposit of $4.0 million.

Current wording

The net cash used in investing activities during the thirty-nine weeks ended May 30, 2026 increased as compared to the prior year comparable period due primarily to lower net investment in certificates of deposit of $13.5 million and an increase in cash paid for acquisitions of$10.4 million, which included the settlement of $0.5 million in acquisition-related holdbacks related to recent acquisitions.

Previous wording

The net cash used in financing activities during the twenty-six weeks ended February 28, 2026 increased as compared to the prior year comparable period due primarily to a $20.2 million increase in the repurchase of Common Stock during the period.

Current wording

The net cash used in financing activities during the thirty-nine weeks ended May 30, 2026 increased as compared to the prior year comparable period due primarily to a $7.1 million increase in the repurchase of Common Stock and $1.7 million in acquisition-related holdbacks settled more than three months after the acquisition date.