-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, COi7NU3wIw1U5C+iAlNmixZlqY3qobgTQ6plHPze0lz1GDNmOhe6q/ymTzChPKLo g13Wgy50ehmEsz6oNhu7Bg== 0000013573-06-000019.txt : 20061114 0000013573-06-000019.hdr.sgml : 20061114 20061114161033 ACCESSION NUMBER: 0000013573-06-000019 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20061001 FILED AS OF DATE: 20061114 DATE AS OF CHANGE: 20061114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BOWL AMERICA INC CENTRAL INDEX KEY: 0000013573 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-AMUSEMENT & RECREATION SERVICES [7900] IRS NUMBER: 540646173 STATE OF INCORPORATION: MD FISCAL YEAR END: 0627 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-07829 FILM NUMBER: 061215206 BUSINESS ADDRESS: STREET 1: 6446 EDSALL RD CITY: ALEXANDRIA STATE: VA ZIP: 22312 BUSINESS PHONE: 7039416300 MAIL ADDRESS: STREET 1: P O BOX 1288 CITY: SPRINGFIELD STATE: VA ZIP: 22151 10-Q 1 rsept06q.txt FORM 10-Q FOR PERIOD ENDED 10/01/2006 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 -----END PRIVACY-ENHANCED MESSAGE-----