UniFirst Announces Financial Results for the Fiscal 2009 Fourth Quarter and Full Year

• Press Release
• Source: UniFirst Corporation
• On 8:00 am EDT, Wednesday October 28, 2009

WILMINGTON, Mass.--(BUSINESS WIRE)--UniFirst Corporation (NYSE: UNF - News) today announced results for its fiscal fourth quarter and full year, which ended on August 29, 2009.

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Symbol	Price	Change
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Revenues for the fourth quarter of fiscal 2009 were $241.5 million, a 3.8% decrease from the previous year’s $251.0 million. Fourth quarter net income was $17.0 million or $0.88 per diluted common share, a 38.6% increase from the fourth quarter of fiscal 2008, when net income was $12.3 million or $0.63 per diluted common share.

Fiscal 2009 full year revenues were down slightly to $1.013 billion from $1.023 billion in fiscal 2008. However, on a comparable work week basis, revenues increased by 1.0% over the prior year, as fiscal 2008 included an extra week compared to fiscal 2009. Net income for the full year was $75.9 million or $3.92 per diluted common share, a 24.4% increase from fiscal 2008, when net income was $61.0 million or $3.15 per diluted common share.

“The rapid pace of job losses and related wearer reductions in our customer base caused a sequential decline in our quarterly revenues during the year, even as we produced solid levels of new sales and customer retention,” said Ronald D. Croatti, UniFirst President and Chief Executive Officer. “Despite these challenging economic conditions, we were able to achieve record profit levels. I would like to personally thank all our thousands of Team Partner employees throughout North America and Europe for their consistent hard work and sacrifices in what proved to be a very challenging year for our Company.”

The Company’s core laundry revenues in the fourth quarter declined 4.0% compared to the same period in fiscal 2008; however, its income from operations increased 31.0%. Total expenses in the core laundries were down $15.5 million from the same quarter a year ago which resulted in a fourth quarter operating margin of 12.6% compared to 9.3% a year earlier. The decline in expenses was the result of lower energy, payroll, and merchandise costs. Gasoline and natural gas costs were significantly lower in the fourth quarter of 2009, as compared with the historically high levels in the same quarter of fiscal 2008. Payroll costs declined from the prior year as a result of headcount reductions made earlier in fiscal 2009. Lower workers’ compensation insurance and travel costs also contributed to the decrease in expenses. These benefits were partially offset by higher healthcare and depreciation expense as well as increases to our reserve for environmental contingencies.

The Company’s Specialty Garments and First Aid segments both contributed to the Company’s overall growth in fourth quarter profits compared to the prior year.

UniFirst continues to generate strong cash flows and maintain a solid balance sheet. Cash produced by operating activities in fiscal 2009 was $159.2 million compared to $119.5 million a year earlier. Free cash flow was used primarily to reduce outstanding debt by $53.1 million. Total debt, as a percentage of capital, as of the end of fiscal 2009, declined to 22.5% from 29.7% at the prior year end. In addition, the year end cash balance increased by $34.5 million to $60.2 million.

“We’re very pleased with the results of our fourth quarter and have begun to see signs of economic stabilization in our customer base,” Croatti said. “However, the overall employment condition remains weak and will continue to challenge our top line performance. As always, our top priority is providing first class service to our diverse customer base. In this environment, continuing to optimize the efficiency of our sales force as well as controlling costs will also be essential to achieving our short term and long term financial goals.”

Conference Call Information

UniFirst will hold a conference call today at 10:00 a.m. (EDT) 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

UniFirst Corporation is one of the largest providers of workplace uniforms, protective clothing, and facility services products in North America. The Company employs nearly 10,000 Team Partners who serve more than 200,000 customer locations in 45 U.S. states, Canada, and Europe from over 200 customer service, distribution, and manufacturing facilities. UniFirst is a publicly held company traded on the New York Stock Exchange under the symbol UNF and is a component of the Standard & Poor's 600 Small Cap Index.

Forward Looking Statements

This public announcement may contain forward looking statements that reflect the Company’s current views with respect to future events and financial performance. 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 are highly dependent upon a variety of 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 regarding the Company’s ability to consummate and successfully integrate acquired businesses, uncertainties regarding any existing or newly-discovered expenses and liabilities related to environmental compliance and remediation, the Company’s ability to compete successfully without any significant degradation in its margin rates, seasonal fluctuations in business levels, uncertainties regarding the price levels of natural gas, electricity, fuel and labor, the impact of negative economic conditions on the Company’s customers and such customers’ workforce, the continuing increase in domestic healthcare costs, demand and prices for the Company’s products and services, additional professional and internal costs necessary for compliance with recent and proposed future changes in Securities and Exchange Commission (including the Sarbanes-Oxley Act of 2002), New York Stock Exchange and accounting rules, strikes and unemployment levels, the Company’s efforts to evaluate and potentially reduce internal costs, economic and other developments associated with the war on terrorism and its impact on the economy and general economic conditions. When used in this public announcement, the words “anticipate,” “optimistic,” “believe,” “estimate,” “expect,” “intend,” and similar expressions as they relate to the Company are included to identify such forward looking statements. The Company undertakes no obligation to update any forward looking statements to reflect events or circumstances arising after the date on which such statements are made.

(1) Exclusive of depreciation on the Company’s fixed assets and amortization on its intangible assets

(2) Unaudited

(1) Unaudited

UniFirst Corporation
Steven S. Sintros, 978-658-8888
Vice President & CFO
ssintros@unifirst.com