FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements concerning our business, operations and financial performance and condition as well as our plans, objectives and expectations for our business operations and financial performance and condition that are subject to risks and uncertainties. All statements other than statements of historical fact included in this Quarterly Report on Form 10-Q are forward-looking statements. These forward-looking statements are based on current expectations, estimates, forecasts and projections about our business and the industry in which we operate and our management's beliefs and assumptions. These statements are not guarantees of future performance or development and involve risks, uncertainties and other factors that are in some cases beyond our control. The forward-looking statements included in this Quarterly Report on Form 10-Q are made as the date hereof. We are under no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

LIQUIDITY AND CAPITAL RESOURCES

The Company views a strong financial position as a major benefit to shareholders and emphasizes payment of dividends as part of its financial plan. A portion of earnings has consistently been invested to create a reserve to protect the Company in downturns in business, to capitalize on opportunities for expansion and modernization and to provide a secure source of income. For these reasons, the Company prefers a conservative approach to investing rather than taking greater risk for possible rapid growth. The Company balances market volatility by using both fixed income and equity investments in managing its reserve funds. Any equity security is subject to price fluctuation, however, the stocks held by the Company have relatively low volatility. The Company has long been invested in a Government National Mortgage Association ("Ginnie Mae" or "GNMA") fund and domestically domiciled stocks with the perceived potential of appreciation, primarily telecommunications stocks. The Company considers that this diversity also provides a measure of safety of principal.

The Company purchased 5,000 shares of Verizon for $178,200 in the quarter ended January 1, 2012. The remainder of common stocks in our portfolio have come from spin-offs, mergers and acquisitions of AT&T and United Telecommunications (now Sprint) purchased in 1979 and 1984 and from one insurance company acquired at no cost when that company demutualized. While not all stocks in the portfolio are domestic American companies any longer, since the original purchases at an approximate cost of $630,000, we have received approximately $962,000 from mergers and sales, and over $3,200,000 in dividends, the majority of which are tax favored in the form of exclusion from federal taxable income. The fair value of the securities on December 30, 2012 was approximately $4,609,000.

The Company's original investment in the Vanguard GNMA bond fund began in 1988 with purchases of shares in the fund totaling approximately $1,400,000. Except for a one time sale of approximately $666,000 in 1991, all earnings have been reinvested. The fund is carried at fair value on the last day of the reporting period. At December 30, 2012, the value was approximately $3,528,000.

Short-term investments consisting mainly of Certificates of Deposits, cash and cash equivalents totaled $2,576,000 at the end of the fiscal second quarter of 2013 compared to $6,196,000 at the end of fiscal 2012. As noted below, short-term investments were used, along with cash on hand, to fund the dividends paid to shareholders during the quarter ended December 30, 2012.

The Company's position in all the above investments is a source of expansion capital. Potential volatility in the trading prices of the marketable securities held by the Company could impact the Company's opportunities for expansion. The Board of Directors reviews the portfolio weekly and any use of this reserve at its quarterly meetings.

In the six-month period ended December 30, 2012, the Company expended approximately $414,000 for the purchase of building, entertainment and restaurant equipment. The Company has made no application for third party funding as cash and cash flows are sufficient to finance all contemplated purchases and to meet short-term purchase commitments and operating lease commitments.

The six-month changes in the categories of Accounts Payable and Accrued Expenses are primarily due to seasonal timing of payments including cash contribution to a benefit plan.

Current liabilities generally increase during the first three quarters of the fiscal year as leagues deposit prize fund monies with the Company throughout the league season. These funds are returned to the leagues at the end of the bowling season, generally in the fourth quarter. At December 30, 2012, league deposits of approximately $1,432,000 were included in the current liabilities category.

Cash flow provided by operating activities in the twenty-six weeks ended December 30, 2012 was $1,969,000 which, along with cash on hand and short-term investments, was sufficient to meet day-to-day cash needs and pay dividends. In December 2012, after reviewing cash and other reserves, the economic climate, and possible changes to federal tax rates on dividends, the Board of Directors declared a special dividend of $.50 per share to be paid December 28, 2012. Additionally, the Company declared a regular quarterly dividend of $.165 per share, usually paid in February, to be paid December 28, 2012. Total cash dividends of approximately $4,276,000, or $.83 per share, were paid to shareholders during the quarter ended December 30, 2012, and the six months total was approximately $5,100,000 or $.99 per share. The economic climate is part of the consideration at the Directors' quarterly reviews of future estimates of cash flows. 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 estimate of future opportunities.

OVERVIEW

The Company is in the entertainment business which, by its nature, has ups and downs based on consumer tastes and whims. Generally, promotional and open play bowling which depends on the public's discretionary budget dollars and their choices, accounts for more than half of our business. An unstable economy can lead many to participate in entertainment that is close to home and relatively inexpensive. Bowling has those advantages. However the longer the economy remains unstable, the less willing people are to spend on other than necessities. Weather is also a factor, especially for casual bowlers. While rainy weather prompts people to look for indoor activities, heavy snow storms can keep customers from reaching the centers. Postponed league games are made up later in the season, but lost open play income is never recovered. Current economic conditions continue to create challenging times but our response will be helped by having the resources to be able to promote the sport.

RESULTS OF OPERATIONS

The following table sets forth the items in our consolidated summary of
operations for the fiscal year-to-date periods ended December 30, 2012, and
January 1, 2012, and the dollar and percentage changes therein.

                                                            Twenty-six weeks ended
                                                    December 30, 2012 and January 1, 2012
                                                             Dollars in thousands
                                        12/30/2012        01/01/2012         Change          % Change
Operating Revenues:
Bowling and other                      $       8,043     $      8,402     $       (359 )           (4.3 )%
Food, beverage & merchandise sales             3,349            3,524             (175 )           (5.0 )
                                              11,392           11,926             (534 )           (4.5 )
Operating Expenses:
Compensation & benefits                        5,867            6,098             (231 )           (3.8 )
Cost of bowling & other                        3,196            3,545             (349 )           (9.8 )
Cost of food, beverage & merch sales           1,002            1,049              (47 )          .(4.5 )
Depreciation & amortization                      777              823              (46 )           (5.6 )
General & administrative                         470              513              (43 )           (8.4 )
                                              11,312           12,028             (716 )           (6.0 )

Operating Income (loss)                           80             (102 )            182            178.4

Interest & dividend income                       250              264              (14 )           (5.3 )

Earnings before taxes                            330              162              168            103.7
Income taxes                                     115               57               58            101.8

Net Earnings                           $         215     $        105     $        110            107.8

Net earnings were $455,674 or $.09 per share for the thirteen-week period ended December 30, 2012, and $380,267 or $.07 per share for the thirteen weeks ended January 1, 2012. For the current year and prior year twenty-six week periods net earnings were $214,681 or $.04 per share and $105,094, or $.02 per share, respectively. The prior year second quarter included New Year's Eve and Day business, however the holiday will be reflected in the third quarter of fiscal 2013. Management believes that the continuing uncertainty of an economic recovery and the consequences of federal tax and spending provisions are influencing the public's view of discretionary spending. The operating results for fiscal 2013 periods included in this report are not necessarily indicative of results to be expected for the year.

Total operating revenues decreased $225,000 to $6,205,000 in the most recent quarter compared to a decrease of $50,000 to $6,430,000 in the three-month period ended January 1, 2012. For the current fiscal six-month period operating revenues were down $534,000 versus a decrease of $204,000 in the comparable six-month period a year ago. Bowling and other revenue declined $135,000 in the quarter and $359,000 year-to-date for the periods ended December 30, 2012. Prior year comparable three and six month period revenues showed decreases of $50,000 and $159,000, respectively.

Food, beverage and merchandise sales were down $90,000 or 3.5% in the current year quarter and down $175,000 or 5% in the six-month period. Cost of sales was down 3.2% and 4.5%, respectively, in the three month and six month periods ended December 30, 2012.

Operating expenses were down $368,000 or 6% and $716,000 or 6% in the current three and six-month periods, respectively, versus decreases of $229,000 or 4% and $307,000 or 3% each in the three and six month periods, respectively, last year. Employee compensation and benefits for the three and six month periods were down $141,000 and $231,000, respectively, or 4.6% and 3.8% in the periods ended December 30, 2012, as the Company continued to make scheduling adjustments in response to customer traffic. In addition, group health insurance costs decreased as a result of lower premiums, fewer participants and the end of costs incurred in establishing health savings accounts. In the prior year comparable periods operating expenses were down $65,000 in the three month period and down $111,000 in the six-month period, or 2% each period respectively. Included in this category of expense are contributions to our two benefit plans, both of which are defined contribution plans. There is no additional obligation beyond the current year contribution.

Cost of bowling and other services decreased $349,000 or 10% and $172,000 or 5% in the six-month periods ended December 30, 2012 and January 1, 2012, respectively. In the twenty-six weeks ended December 30, 2012, maintenance and repair costs were down $12,000 or 6% primarily the result of fewer building repairs. In the prior year twenty-six week period costs were down $85,000 or 17%. Advertising costs during the current year twenty-six week period were down $24,000 versus a decrease of $66,000 in the prior year comparable period, or 14% in each period due in part to the change in media used. For the six month periods ended December 30, 2012 and January 1, 2012, respectively, utility costs were down $28,000 or 8% and down $32,000 or 4%. Lower fuel costs and our efforts in energy management are primarily responsible for the decreases. Supplies and services expenses were down 9% in the current year six-month period and down 3% in the six-month period in the prior year. Changes in the timing of purchases and lower costs of some supplies are the primary reasons for the decreases.

Insurance expense excluding health insurance decreased 11% in the current year-to-date period versus an increase of 7% in last year's comparable period when the Company made policy and coverage changes.

Depreciation and amortization expense was down 6% in the current six-month period and 5% in the prior year six-month period.

As a result of the above, the current six-month period of fiscal 2013 showed operating income of $80,000 compared to the prior year six-month period that showed an operating loss of $102,000.

Interest and dividend income decreased $14,000 in the fiscal 2013 six-month period and decreased $67,000 in the comparable 2012 year-to-date period, respectively. The current year decrease is a result of lower investment balances, lower interest rates and lower capital gains from the Ginnie Mae fund.

CRITICAL ACCOUNTING POLICIES

Management has identified accounting for marketable investment securities as a critical accounting policy due to the significance of the amounts included in the Company's balance sheet under the captions of Short-term investments and Marketable 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 earnings, 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.

Management has identified accounting for the impairment of long-lived assets as a critical accounting policy due to the significance of the amounts included in the Company's 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.