XML 25 R13.htm IDEA: XBRL DOCUMENT v3.8.0.1
Goodwill, Service Contracts and Other Assets
6 Months Ended
Nov. 30, 2017
Goodwill, Service Contracts and Other Assets [Abstract]  
Goodwill, Service Contracts and Other Assets
Goodwill, Service Contracts and Other Assets
 
Changes in the carrying amount of goodwill and service contracts for the six months ended November 30, 2017, by reportable operating segment and All Other, are as follows:
Goodwill (in thousands)
Uniform Rental
 and Facility Services
 
First Aid
 and Safety Services
 
All
Other
 
Total
 
 
 
 
 
 
 
 
Balance as of June 1, 2017
$
2,448,070

 
$
243,112

 
$
91,153

 
$
2,782,335

Goodwill acquired (1)
27,107

 
73

 
426

 
27,606

Foreign currency translation
927

 
891

 
37

 
1,855

Balance as of November 30, 2017
$
2,476,104

 
$
244,076

 
$
91,616

 
$
2,811,796



(1) Adjustments to the G&K preliminary purchase price allocation represent $27.1 million of the acquired goodwill in the Uniform Rental and Facility Services reportable operating segment. See Note 9 entitled Acquisitions for more information.
Service Contracts (in thousands)
Uniform Rental
 and Facility Services
 
First Aid
 and Safety Services
 
All
Other
 
Total
 
 

 
 

 
 

 
 

Balance as of June 1, 2017
$
529,923

 
$
30,062

 
$
27,003

 
$
586,988

Service contracts acquired
32

 
411

 
533

 
976

Service contracts amortization
(21,946
)
 
(1,927
)
 
(2,364
)
 
(26,237
)
Foreign currency translation
3,748

 
99

 

 
3,847

Balance as of November 30, 2017
$
511,757

 
$
28,645

 
$
25,172

 
$
565,574



Information regarding Cintas’ service contracts and other assets is as follows:
 
As of November 30, 2017
(In thousands)
Carrying Amount
 
Accumulated Amortization
 
Net
 
 
 
 
 
 
Service contracts
$
917,072

 
$
351,498

 
$
565,574

 
 
 
 
 
 
Noncompete and consulting agreements
$
40,913

 
$
39,588

 
$
1,325

Other
35,711

 
7,876

 
27,835

Total other assets
$
76,624

 
$
47,464

 
$
29,160

 
As of May 31, 2017
(In thousands)
Carrying Amount
 
Accumulated Amortization
 
Net
 
 
 
 
 
 
Service contracts
$
911,273

 
$
324,285

 
$
586,988

 
 
 
 
 
 
Noncompete and consulting agreements
$
40,743

 
$
39,244

 
$
1,499

Other
34,890

 
4,422

 
30,468

Total other assets
$
75,633

 
$
43,666

 
$
31,967


Amortization expense for service contracts and other assets for continuing operations was $15.6 million and $3.2 million for the three months ended November 30, 2017 and 2016, respectively. Amortization expense for service contracts and other assets for continuing operations was $29.8 million and $6.4 million for the six months ended November 30, 2017 and 2016, respectively. Estimated amortization expense for service contracts and other assets excluding any future acquisitions, for each of the next five full fiscal years and thereafter is $61.3 million, $61.0 million, $59.6 million, $53.8 million, $51.8 million and $248.3 million, respectively. The increase in amortization expense in the current year and for the next five years over past fiscal years is the result of the G&K acquisition.