FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
QUARTER ENDED: OCTOBER 1, 2006 COMMISSION FILE NUMBER: 0-1830
BOWL AMERICA INCORPORATED
(Exact name of registrant as specified in its charter)
MARYLAND 54-0646173
(State of Incorporation) (I.R.S.Employer Identification No)
6446 Edsall Road, Alexandria, Virginia 22312
(Address of principal executive offices)(Zip Code)
(703) 941-6300
(Registrant's telephone number including area code)
Indicate by checkmark if the registrant is well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes__ NO X
Indicate by a check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No___
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2of the Exchange Act.
Large Accelerated Filer __ Accelerated Filer __ Non-Accelerated Filer X
Indicate by check mark whether the registrant is a shell company (as defined
by Rule 12b-2 of the Exchange Act) Yes__ No X
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the last practicable date.
Shares Outstanding at
October 29, 2006
Class A Common Stock,
$.10 par value 3,668,430
Class B Common Stock,
$.10 par value 1,468,462
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
Thirteen Weeks Ended
October 1, October 2,
2006 2005
Operating Revenues:
Bowling and other $5,131,645 $4,561,506
Food, beverage and merchandise sales 2,010,317 1,815,096
_________ _________
7,141,962 6,376,602
Operating Expenses:
Employee compensation and benefits 3,437,867 3,185,029
Cost of bowling and other services 1,783,658 1,723,665
Cost of food, beverage and merchandise sales 595,009 580,851
Depreciation and amortization 480,466 376,326
General and administrative 216,548 216,595
_________ _________
6,513,548 6,082,466
Operating Income 628,414 294,136
Interest and dividend income 157,729 156,351
_________ _________
Earnings before provision for income taxes 786,143 450,487
Provision for Income Taxes 272,000 152,000
_________ _________
Net Earnings $ 514,143 $ 298,487
========= =========
Earnings per share-basic and diluted $ .10 $.06
Weighted average shares outstanding 5,136,892 5,137,076
Dividends paid $ 719,165 $ 719,177
Per share, dividends paid, Class A $.14 $.14
Per share, dividends paid, Class B $.14 $.14
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS
(Unaudited)
Net Earnings $ 514,143 $ 298,487
Other comprehensive earnings, net of tax
Unrealized gain (loss) on available-for
-sale securities 295,248 (44,651)
_________ ________
Comprehensive earnings $ 809,391 $ 253,836
========= ========
The operating results for the thirteen (13) week period ending October 1,
2006 are not necessarily indicative of results to be expected for the year.
See notes to condensed consolidated financial information.
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
As of
October 1, July 2,
2006 2006
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 1,746,815 $ 1,055,687
Short-term investments 7,697,827 7,990,636
Inventories 803,385 625,467
Prepaid expenses and other 847,894 1,046,908
Income taxes refundable - 172,873
Current deferred income taxes 46,910 46,910
__________ __________
TOTAL CURRENT ASSETS 11,142,831 10,938,481
LAND, BUILDINGS & EQUIPMENT
Net of accumulated depreciation of
$30,856,637 and $30,376,171 26,754,656 27,053,704
OTHER ASSETS:
Marketable equity securities 4,954,280 4,540,061
Cash surrender value-life insurance 507,878 505,664
Other 93,180 92,475
__________ __________
TOTAL OTHER ASSETS 5,555,338 5,138,200
TOTAL ASSETS $43,452,825 $43,130,385
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 814,045 $ 910,550
Accrued expenses 799,848 1,214,780
Dividends payable 719,165 719,165
Income taxes payable 31,127 -
Other current liabilities 935,266 395,919
__________ __________
TOTAL CURRENT LIABILITIES 3,299,451 3,240,414
LONG-TERM DEFERRED COMPENSATION 66,221 66,221
NONCURRENT DEFERRED INCOME TAXES 2,907,973 2,734,796
__________ __________
TOTAL LIABILITIES 6,273,645 6,041,431
__________ __________
COMMITMENTS AND CONTINGENCIES (Note 3)
STOCKHOLDERS' EQUITY
Preferred stock, par value $10 a share:
Authorized and unissued, 2,000,000 shares - -
Common stock, par value $.10 a share:
Authorized, 10,000,000 shares
Class A issued and outstanding
3,668,430 shares 366,843 366,843
Class B issued and outstanding
1,468,462 shares 146,846 146,846
Additional paid-in capital 7,480,615 7,480,615
Accumulated other comprehensive earnings-
Unrealized gain on available-for-sale
securities, net of tax 2,633,813 2,338,565
Retained earnings 26,551,063 26,756,085
__________ __________
TOTAL STOCKHOLDERS'EQUITY 37,179,180 37,088,954
__________ __________
TOTAL LIABILITIES AND STOCKHOLDERS'EQUITY $43,452,825 $43,130,385
========== ==========
See notes to condensed consolidated financial statements.
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Thirteen Weeks Ended
October 1, October 2,
2006 2005
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings $ 514,143 $ 298,487
Adjustments to reconcile net earnings
to net cash provided by
operating activities:
Depreciation and amortization 480,466 376,326
Changes in assets and liabilities
Increase in inventories (177,918) (146,183)
Decrease in prepaid & other 199,014 94,575
Decrease in income taxes refundable 172,873 92,000
Increase in income taxes payable 31,127 -
(Increase ) decrease in other
long-term assets (2,919) 63,528
Decrease in accounts payable (96,505) (212,842)
Decrease increase in accrued expenses (414,932) (438,914)
Increase in other current liabilities 539,347 532,054
_________ _________
Net cash provided by
operating activities 1,244,696 659,031
_________ _________
Cash flows from investing activities
Expenditures for land, buildings and equip (181,418) (1,762,974)
Net sales & maturities of short-term
investments 347,015 2,734,543
_________ _________
Net cash provided by investing activities 165,597 971,569
_________ _________
Cash flows from financing activities
Payment of cash dividends (719,165) (719,177)
_________ _________
Net cash used in financing activities (719,165) (719,177)
_________ _________
Net Increase in Cash and Equivalents 691,128 911,423
_________ _________
Cash and Equivalents, Beginning of quarter 1,055,687 1,707,385
_________ _________
Cash and Equivalents, End of quarter $1,746,815 $2,618,808
========= =========
Supplemental Disclosures of Cash Flow Information
Cash Paid During the Quarter for
Income taxes $ 68,000 $ 60,000
Non-cash Investing and Financing Activities:
Settlement of employee stock loan by
acquisition of common stock - $2,845
Repayment of employee loans by acquisition
of common stock - $8,257
See notes to condensed consolidated financial information.
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the Thirteen Weeks Ended
October 1, 2006
(Unaudited)
1. Basis for Presentation
The accompanying unaudited condensed consolidated financial statements of
Bowl America Incorporated and subsidiaries (the "Company"), have been prepared
pursuant to the rules and regulations of the Securities and Exchange Commission.
The condensed consolidated balance sheet as of July 2, 2006 has been derived
from the Company's July 2, 2006 audited financial statements. Certain
information and note disclosures normally included in the annual financial
statements, prepared in accordance with accounting principles generally
accepted in the United States of America, have been condensed or omitted
pursuant to those rules and regulations, although the Company believes that
the disclosures made are adequate to make the information presented not
misleading.
In the opinion of management, the accompanying unaudited condensed
consolidated financial statements reflect all adjustments and reclassifications
(all of which are of a normal, recurring nature) that are necessary for the
fair presentation for the periods presented. It is suggested that these
condensed consolidated financial statements be read in conjunction with the
consolidated financial statements and notes thereto included in the Company's
latest annual report to the Securities and Exchange Commission on Form 10-K
for the year ended July 2, 2006.
2. Marketable Equity Securities
Marketable equity securities, available for sale, are carried at fair
value in accordance with the provisions of SFAS No. 115. At October 1, 2006,
the fair value of these securities was $4,954,280, with an original cost of
$757,054, resulting in an unrealized gain of $4,197,226.
The telecommunications stocks included in the portfolio as of October 1,
2006 were:
220 shares of Agere
3,946 shares of Alltel
669 shares of Avaya
27,572 shares of Bell South
2,000 shares of Embarq
8,028 shares of Lucent Technologies
9,969 shares of Qwest Communications
45,580 shares of SBC
40,000 shares of Sprint
18,784 shares of Verizon
13,560 shares of Vodafone/AirTouch
4,079 shares of Windstream
3. Commitments and Contingencies
The Company's purchase commitments at October 1, 2006, are for materials,
supplies, services and equipment as part of the normal course of business.
4. Employee benefit plans
The Company has two defined contribution plans with Company contributions
determined by the Board of Directors. The Company has no defined benefit plan
or other postretirement plan.
5. Reclassifications
Certain previous year amounts have been reclassified to conform with
current year presentation.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Short-term investments, consisting mainly of U.S. Treasury Bills and Notes,
and cash totaled $9,445,000 at the end of the first quarter of fiscal 2007 or
$398,000 higher than at the beginning of the quarter. The increased funds
result primarily from operations, which reflects the seasonal nature of the
business.
In the three-month period ended October 1, 2006, the Company expended
approximately $181,000 for purchase of equipment, point-of-sale cash systems
and replacement of some amusement games. The Company is actively seeking
property for additional locations. The Company has made no application for
third party funding as cash and cash flow are sufficient to finance all
currently contemplated purchases and to meet short-term commitments. The
table below summarizes these obligations as of October 1, 2006. The Company
has also maintained its fiscal year end 2006 position in marketable equity
securities, primarily telecommunications stocks, as a further source of
expansion capital.
These marketable securities are carried at their fair value on the last day of
the quarter. For the three-month period ended October 1, 2006, the market
value increased by $414,000 to approximately $4,954,000.
- ------------------------------------------------------------------------------
Contractual Total Less Than 1-3 3-5 More Than
obligations 1 Year Years Years 5 Years
______________________________________________________________________________
Operating lease
obligations $1,197,301 $ 272,459 $514,174 $176,000 $234,667
Purchase
obligations - -
______________________________________________________________________________
Total $1,197,301 $ 272,459 $514,174 $176,000 $234,667
==============================================================================
While no factors calling for a change in the dividend rate are apparent, the
Board of Directors decides the amount and timing of any dividend at its
quarterly meeting based on its appraisal of the state of the business and its
estimate of future opportunities.
On September 28, 2006, the Board of Directors declared a cash dividend of $.14
per share on its Class A and Class B stock to holders of record on October 18,
2006, payable November 15, 2006.
RESULTS OF OPERATIONS
The Company opened Bowl America Short Pump in late January 2006. Nineteen
centers were in operation in the current year first quarter and eighteen
centers were in operation in the prior year comparable quarter. All
comparisons in this report are affected by the change in the number of
locations in operation in the periods.
Net earnings were $514,143 in the quarter ended October 1, 2006 and $298,487
in the quarter ended October 2, 2005, or $.10 and $.06 per share for the first
quarters of fiscal 2007 and 2006, respectively. The operating results for the
periods included in this report are not necessarily indicative of results to be
expected for the year.
Operating revenues increased 12% or $765,000 in the fiscal year 2007 first
quarter versus an increase of 8% or $476,000 in the prior year comparable
three-month period. Bowling and other revenue increased 12% or $570,000 in
the current year fiscal quarter versus an increase of 8% or $339,000 in the
prior fiscal year quarter. In addition to business from the new center, an
increase in open play traffic and a higher average game rate at comparable
centers in the current year first quarter also contributed to favorable
revenue comparison.
Food, beverage and merchandise sales were up 11% or $195,000 in the current
three-month period due to the increased traffic and up 8% or $138,000 in the
comparable prior year period. Cost of sales increased in response to the
higher sales.
Operating expenses were up 7% or $431,000 in the current three-month period
and up 10% or $541,000 in the comparable period last year. Employee
compensation and benefits were up 8% and 7% in the current and prior year
quarters, respectively.
Cost of bowling and other services increased 4% or $60,000 in the first quarter
of fiscal 2007 versus a 17% increase or $248,000 in the quarter ended October
2, 2005. Advertising and promotion expense decreased 32% or $63,000 in the
quarter ended October 1, 2006 and increased 44% or $61,000 in the prior year
comparable quarter. Maintenance repair expense decreased 12% or $29,000 in
the current year quarter and was up 48% or $80,000 in the prior year quarter.
The prior year increase included major plumbing repairs. Supplies and services
expenses increased 18% for the current year three-month period and 8% in last
year's three-month period. Utility costs were up 15% and 9% in the current
year and prior year quarters, respectively.
Rent expense decreased 3% in the current year quarter and 8% in the prior year
comparable period. Insurance expense excluding health insurance decreased 5%
in the current year quarter versus an increase of 12% in last year's
comparable quarter.
Depreciation and amortization expense increased 28% in the current year period
due mainly to the additional assets at Short Pump and decreased 6% in the
comparable period last year.
Interest and dividend income was flat in the current year period due to lower
investment balances and increased 50% or $52,000 in the prior year period due
to higher interest rates on investments.
CRITICAL ACCOUNTING POLICIES
We have identified accounting for marketable investment securities under SFAS
115 ("Accounting for Certain Investments in Debt and Equity Securities") as a
critical accounting policy due to the significance of the amounts included in
our balance sheet under the captions of Short-term investments and Marketable
equity securities. The Company exercises judgment in determining the
classification of its investment securities as available-for-sale and in
determining their fair value. The Company records these investments at their
fair value with the unrealized gain or loss recorded in accumulated other
comprehensive income, a component of stockholders' equity, net of deferred
taxes. Additionally, from time to time the Company must assess whether write-
downs are necessary for other than temporary declines in value.
We have identified accounting for the impairment of long-lived assets under
SFAS 144 "Accounting for the Impairment or Disposal of Long-Lived Assets" as a
critical accounting policy due to the significance of the amounts included in
our balance sheet under the caption of Land, Buildings and Equipment. The
Company reviews long-lived assets whenever events or changes indicate that the
carrying amount of an asset may not be recoverable. In making such evaluations,
the Company compares the expected future cash flows to the carrying amount of
the assets. An impairment loss equal to the difference between the assets'
fair value and carrying value is recognized when the estimated future cash
flows are less than the carrying amount.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Interest Rate Risk. Our short-term investments and certain cash equivalents
are subject to interest rate risk. We manage this risk by maintaining an
investment portfolio of available-for-sale instruments with high credit
quality and relatively short average maturities. The fair value of marketable
debt securities held was $7,698,000 and $8,516,000 at October 1, 2006 and
October 2, 2005 respectively. The fair value of certain fixed rate debt
securities will change depending on movements in interest rates. Declines in
interest rates will affect our interest income. Based on our portfolio of debt
securities at October 1, 2006, a 10% decline in the average yield would have
no material impact on annual interest income.
ITEM 4. CONTROLS AND PROCEDURES
The Company's Chief Executive Officer and Chief Financial Officer have
concluded that the Company's disclosure controls and procedures are effective
based on their evaluation of such controls and procedures as of October 1, 2006.
There was no change in the Company's internal control over financial reporting
identified in connection with the evaluation that occurred during the quarter
ended October 1, 2006, that materially affected, or is reasonably likely to
materially affect, the Company's internal control over financial reporting.
BOWL AMERICA INCORPORATED AND SUBSIDIARIES
S.E.C. FORM 10-Q
October 1, 2006
PART II - OTHER INFORMATION
Item 1A. Risk Factors
Item 1A ("Risk Factors") of the Company's Annual Report on Form 10-K for the
fiscal year ended July 2, 2006, sets forth information relating to important
risks and uncertainties that could materially adversely affect the Company's
business, financial condition or operating results. Those risk factors
continue to be relevant to an understanding of the Company's business,
financial condition and operating results. There are no material changes in
such risk factors to report.
Item 6 Exhibits
3 (a) Articles of Incorporation of the Registrant and amendments through
December 1988 thereto (Incorporated by reference from exhibit 3 to
the Annual Report for 1989 on Form 10-K for fiscal year ended July
2, 1989)
3 (b) Amendment to and restatement of Article FIFTH (b) III 2.2 of the
Registrant's Articles of Incorporation (Incorporated by reference
from the Registrant's Form 8-K filed December 9, 1994)
3 (c) By-laws of the Registrant (Incorporated by reference from exhibit
3 to the Annual Report for 1989 on Form 10-K for fiscal year ended
July 2, 1989)
10 (a) Extension of employment agreement with Leslie H. Goldberg
(Incorporated by reference from the Registrant's Form 8-K filed
June 22, 2006)
10 (b) Employment agreement , dated December 31, 2005, between Registrant
and Irvin Clark (Incorporated by reference from Registrant's Form
8-K filed January 10, 2006)
10 (c) Employment agreement, dated December 31, 2004, between Registrant
and Cheryl A. Dragoo (Incorporated by reference from Registrant's
Form 8-K filed December 30, 2004)
20 Press release issued November 14, 2006 (furnished herewith)
31.1 Certification of Chief Executive Officer Pursuant to Section 302
of the Sarbanes-Oxley Act
31.2 Certification of Chief Financial Officer Pursuant to Section 302
of the Sarbanes-Oxley Act
32 Written Statement of the Chief Executive Officer and Chief
Financial Officer Pursuant to 18 U.S.C. 1350
Pursuant to the requirements of the Securities Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
Bowl America Incorporated
(Registrant)
Date: November 14, 2006 By: Leslie H. Goldberg
Leslie H. Goldberg, President
Date: November 14, 2006 By: Cheryl A. Dragoo
Cheryl A. Dragoo, Controller
EX-31.1
Exhibit 31.1 to Form 10-Q
Certification of Chief Executive Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act and Rule 13a-14(a) Or
15d-14(a) under the Securities Exchange Act of 1934
I, Leslie H. Goldberg, certify that:
1. I have reviewed this Quarterly Report on Form 10-Q of Bowl America
Incorporated;
2. Based on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))
for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter that has materially affected, or is reasonably likely
to materially affect, the registrant's internal control over financial
reporting: and
5. The registrant's other certifying officer and I have disclosed, based on
our most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or
operation of internal controls over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control
over financial reporting.
Date: November 14, 2006 Leslie H Goldberg
Chief Executive Officer
Exhibit 31.2
Exhibit 31.2 to Form 10-Q
Certification of Chief Financial Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act and Rule 13a-14(a) Or
15d-14(a) under the Securities Exchange Act of 1934
I, Cheryl A. Dragoo, certify that:
1. I have reviewed this Quarterly Report on Form 10-Q of Bowl America
Incorporated;
2. Based on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))
for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter that has materially affected, or is reasonably likely
to materially affect, the registrant's internal control over financial
reporting: and
5. The registrant's other certifying officer and I have disclosed, based on
our most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or
operation of internal controls over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control
over financial reporting.
Date: November 14, 2006 Cheryl A. Dragoo
Chief Financial Officer
Exhibit 32
Exhibit 32 to Form 10-Q
Written Statement of the Chief Executive Officer and Chief Financial
Officer
Pursuant to 18 U.S.C. 1350
Solely for the purposes of complying with 18 U.S.C. 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, we, the
undersigned Chief Executive Officer and Chief Financial Officer of Bowl
America Incorporated (the "Company"), hereby certify, based on our
knowledge, that the Quarterly Report on Form 10-Q of the Company for the
period ended October 1, 2006, (the "Report") fully complies with the
requirements of Section 13(a) of the Securities Act of 1934 and that
information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.
Leslie H. Goldberg
Chief Executive Officer
Cheryl A. Dragoo
Chief Financial Officer
Date: November 14, 2006
Exhibit 20
Exhibit 20 to Form 10-Q
Press Release Issued November 14, 2006
For Immediate Release November 14, 2006
SUBSTANTIAL FIRST QUARTER IMPROVEMENT AT BOWL AMERICA
Bowl America Incorporated today reported earnings for its first quarter ended
October 1, 2006, increased to $.10 per share from $.06 in the prior year's
first quarter. In addition to the contribution from its newest center, opened
in January, the quarter benefited from response to Bowl America's targeted
bowling promotions. Bowling profits are highly seasonal and summer results
tend to have a larger percentage swing than those in the peak season.
During the second quarter last year rain attendant to the hurricane season
caused people to seek indoor recreation. Thus far this year there have been
fewer storms.
The payment of this November 2006 dividend represents the 34th consecutive
year of increased dividends paid to Bowl America stockholders.
Bowl America operates 19 bowling centers and its stock trades on the American
Stock Exchange with the symbol BWLA. The Company's S.E.C. Form 10-Q is
available through the Company's web site at www.bowlamericainc.com.
* * * *
BOWL AMERICA INCORPORATED
Results of Operations
(unaudited)
Thirteen weeks ended
October 1, October 2,
2006 2005
Revenues
Bowling and other $5,131,645 $4,561,506
Food, beverage & merchandise sales 2,010,317 1,815,096
_________ _________
7,141,962 6,376,602
Operating expenses
excluding depreciation and amortization 6,033,082 5,706,140
Depreciation and amortization 480,466 376,326
Interest & dividend 157,729 156,351
Earnings before taxes 786,143 450,487
Net Earnings $ 514,143 $ 298,487
Weighted average shares outstanding 5,136,892 5,137,076
EARNINGS PER SHARE $.10 $.06
SUMMARY OF FINANCIAL POSITION
(unaudited)
Dollars in Thousands
10/01/06 10/02/05
ASSETS
Total current assets including cash and
short-term investments of $9,445 & $11,135 $11,143 $12,337
Property and investments 32,310 29,592
______ ______
TOTAL ASSETS $43,453 $41,929
LIABILITIES AND STOCKHOLDERS'EQUITY
Total current liabilities $ 3,299 $ 3,478
Other liabilities 2,975 2,733
Stockholders' equity 37,179 35,718
______ ______
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $43,453 $41,929