UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~January 1,~~April 2, 2006

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-1370

BRIGGS & STRATTON CORPORATION
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(Exact name of registrant as specified in its charter)

Wisconsin		39-0182330
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(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

12301 West Wirth Street, Wauwatosa, Wisconsin 53222
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(Address of Principal Executive Offices) (Zip Code)

414/259-5333
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(Registrant’s telephone number, including area code)

Indicate by 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-2 of the Exchange Act. (Check one):

Large accelerated filer X Accelerated filer Non-accelerated filer

Indicate by check mark whether the registrant is a shell company (as defined in 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 latest practicable date.

				~~Outstanding at~~
Class				~~January 27,~~Outstanding at April 28, 2006
COMMON STOCK, par value $0.01 per share				~~51,804,698~~51,139,960 Shares

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

INDEX

		Page No.

PART I —– FINANCIAL INFORMATION

Item 1.	Financial Statements

	Consolidated Condensed Balance Sheets – ~~January 1,~~April 2, 2006 and July 3, 2005	3

	Consolidated Condensed Statements of Income – Three Months and ~~Six~~Nine Months Ended ~~January 1,~~April 2, 2006 and ~~December 26, 2004~~March 27, 2005	5

	Consolidated Condensed Statements of Cash Flows – ~~Six~~Nine Months Ended ~~January 1,~~April 2, 2006 and ~~December 26, 2004~~March 27, 2005	6

	Notes to Consolidated Condensed Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25

Item 4.	Controls and Procedures	25

PART II —– OTHER INFORMATION

Item 1.	Legal Proceedings	26

Item 4.2.	~~Submission~~Unregistered Sales of ~~Matters to a Vote~~Equity Securities and Use of ~~Security Holders~~Proceeds	26

Item 6.	Exhibits	2627

Signatures		2728

Exhibit Index		2829

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)

ASSETS

	January 1,		July 3,		April 2,		July 3,
	2006		2005		2006		2005
	(Unaudited)				(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents	$	39,759	$	161,573	$	63,515	$	161,573
Accounts receivable, net	467,248		360,786		435,765		360,786
Inventories -
Finished products and parts	400,441		283,405		384,439		283,405
Work in process	232,155		174,648		199,774		174,648
Raw materials	12,244		11,612		9,586		11,612
Total inventories	644,840		469,665		593,799		469,665
Deferred income tax asset	94,719		92,251		96,181		92,251
Prepaid expenses and other current assets	29,029		34,930		24,932		34,930
Total current assets	1,275,595		1,119,205		1,214,192		1,119,205

OTHER ASSETS:
Goodwill	253,663		253,663		253,663		253,663
Investments	47,879		49,783		48,554		49,783
Deferred loan costs, net	5,223		6,016		4,860		6,016
Other intangible assets, net	95,520		96,445		95,058		96,445
Other long-term assets, net	27,046		26,601		29,195		26,601
Total other assets	429,331		432,508		431,330		432,508

PLANT AND EQUIPMENT:
Cost	1,018,825		1,005,644		1,031,310		1,005,644
Less - accumulated depreciation	578,477		558,389		593,922		558,389
Total plant and equipment, net	440,348		447,255		437,388		447,255
	$	2,145,274	$	1,998,968	$	2,082,910	$	1,998,968

The accompanying notes are an integral part of these statements.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

CONSOLIDATED CONDENSED BALANCE SHEETS (Continued)

(In thousands, except per share data)

LIABILITIES & SHAREHOLDERS’ INVESTMENT

	January 1,			July 3,			April 2,			July 3,
	2006			2005			2006			2005
	(Unaudited)						(Unaudited)
CURRENT LIABILITIES:
Accounts payable	$	149,278		$	155,973		$	169,606		$	155,973
Accrued liabilities	189,926			196,252			212,144			196,252
Dividends payable	11,409			-			11,310			-
Current maturity on long-term debt	40,000			-
Current maturity of long-term debt							40,000			-
Short-term debt	138,060			443			3,032			443
Total current liabilities	528,673			352,668			436,092			352,668

OTHER LIABILITIES:
Long-term debt	441,754			486,321			441,940			486,321
Deferred income tax liability	106,900			113,794			103,604			113,794
Accrued pension cost	53,304			47,944			56,049			47,944
Accrued employee benefits	15,687			15,125			16,034			15,125
Accrued postretirement health care obligation	80,811			77,607			82,619			77,607
Other long-term liabilities	15,778			16,323			15,608			16,323
Total other liabilities	714,234			757,114			715,854			757,114

SHAREHOLDERS' INVESTMENT:
SHAREHOLDERS’ INVESTMENT:
Common stock -
Authorized 120,000 shares, $.01 par value, issued 57,854 shares	579			579			579			579
Additional paid-in capital	60,739			55,793			64,165			55,793
Retained earnings	1,033,114			1,029,329			1,081,839			1,029,329
Accumulated other comprehensive loss	(45,836		)	(48,331		)	(49,102		)	(48,331		)
Unearned compensation on restricted stock	(2,942		)	(1,985		)	(2,814		)	(1,985		)
Treasury stock at cost, 5,993 and 6,114 shares, respectively	(143,287		)	(146,199		)
Total shareholders' investment	902,367			889,186
Treasury stock at cost, 6,493 and 6,114 shares, respectively							(163,703		)	(146,199		)
Total shareholders’ investment							930,964			889,186
	$	2,145,274		$	1,998,968		$	2,082,910		$	1,998,968

The accompanying notes are an integral part of these statements.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

	Three Months Ended						Six Months Ended						Three Months Ended						Nine Months Ended
	January 1,			December 26,			January 1,			December 26,			April 2,			March 27,			April 2,			March 27,
	2006			2004			2006			2004			2006			2005			2006			2005

NET SALES	$	574,313		$	503,700		$	1,086,022		$	942,695		$	800,194		$	840,463		$	1,886,216		$	1,783,158

COST OF GOODS SOLD	456,961			397,558			887,362			765,735			619,261			674,735			1,506,623			1,440,470

Gross profit on sales	117,352			106,142			198,660			176,960			180,933			165,728			379,593			342,688

ENGINEERING, SELLING, GENERAL AND ADMINISTRATIVE EXPENSES	78,722			92,658			148,999			160,618			82,743			68,244			231,742			228,862

Income from operations	38,630			13,484			49,661			16,342			98,190			97,484			147,851			113,826

INTEREST EXPENSE	(11,305		)	(8,795		)	(21,333		)	(16,914		)	(10,893		)	(10,240		)	(32,226		)	(27,154		)

OTHER INCOME, net	6,223			6,081			12,487			9,014			1,508			4,930			13,995			13,944

Income before provision for income taxes	33,548			10,770			40,815			8,442			88,805			92,174			129,620			100,616

PROVISION FOR INCOME TAXES	11,730			3,710			14,270			2,870			28,797			31,350			43,067			34,220

Income before extraordinary item													60,008			60,824			86,553			66,396

EXTRAORDINARY GAIN - NEGATIVE GOODWILL													-			19,800			-			19,800

NET INCOME	$	21,818		$	7,060		$	26,545		$	5,572		$	60,008		$	80,624		$	86,553		$	86,196

EARNINGS PER SHARE DATA -

Average shares outstanding	51,695			51,193			51,714			51,361			51,478			51,194			51,633			51,428

Income before extraordinary item													$	1.17		$	1.19		$	1.68		$	1.29
Extraordinary gain													-			0.38			-			0.38

Basic earnings per share	$	0.42		$	0.14		$	0.51		$	0.11		$	1.17		$	1.57		$	1.68		$	1.67

Diluted average shares outstanding	52,066			51,751			52,093			51,905			51,561			51,710			51,730			51,964

Income before extraordinary item													$	1.16		$	1.18		$	1.67		$	1.28
Extraordinary gain													-			0.38			-			0.38

Diluted earnings per share	$	0.42		$	0.14		$	0.51		$	0.11		$	1.16		$	1.56		$	1.67		$	1.66

CASH DIVIDENDS PER SHARE	$	0.22		$	0.17		$	0.44		$	0.34		$	0.22		$	0.17		$	0.66		$	0.51

The accompanying notes are an integral part of these statements.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six Months Ended
	January 1,			December 26,			Nine Months Ended
	2006			2004			April 2,			March 27,
							2006			2005
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	26,545		$	5,572		$	86,553		$	86,196
Adjustments to reconcile net income to net cash used in
operating activities:
Adjustments to reconcile net income to net cash used in operating activities:
Extraordinary gain							-			(19,800		)
Depreciation and amortization	38,373			35,600			57,389			53,578
Earnings of unconsolidated affiliates, net of dividends	1,948			3,517			811			5,437
(Gain) Loss on disposition of plant and equipment	(5,402		)	1,279			(5,267		)	1,922
Provision for deferred income taxes	(9,362		)	(29,392		)	(14,120		)	(15,428		)
Change in bad debt allowance	(658		)	40,123			(320		)	38,916
Stock compensation expense	4,385			237			6,463			604
Change in operating assets and liabilities:
Increase in receivables	(105,804		)	(116,144		)	(74,659		)	(176,766		)
Increase in inventories	(175,175		)	(165,404		)	(124,134		)	(49,996		)
(Increase) Decrease in prepaid expenses and other current assets	(1,254		)	994			(673		)	5,960
Decrease in accounts payable, accrued liabilities, and income taxes	(3,426		)	(11,920		)
Increase in accounts payable, accrued liabilities, and income taxes							40,756			37,615
Increase (Decrease) in accrued/prepaid pension	5,360			(475		)	8,105			(810		)
Other, net	(3,407		)	2,044			(1,566		)	2,718
Net cash used in operating activities	(227,877		)	(233,969		)	(20,662		)	(29,854		)

CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to plant and equipment	(34,354		)	(39,382		)	(49,409		)	(61,027		)
Proceeds received on sale of plant and equipment	10,696			332
Proceeds received on sale of assets							10,836			4,808
Investment in joint venture	(900		)	-			(900		)	(1,500		)
Proceeds received on sale of certain assets of a subsidiary	-			4,050
Cash paid for acquisition, net of cash acquired	-			(223,113		)	-			(350,044		)
Refund of cash paid for acquisition	6,347			-			6,347			-
Loan receivable							(2,500		)	-
Net cash used in investing activities	(18,211		)	(258,113		)	(35,626		)	(407,763		)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings on loans and notes payable	132,617			160,950
Net (repayments) borrowings on loans and notes payable							(2,411		)	131,570
Dividends	(11,379		)	(8,694		)	(22,760		)	(17,502		)
Proceeds from exercise of stock options	2,367			17,648			9,160			19,037
Net cash provided by financing activities	123,605			169,904
Treasury stock purchases							(26,559		)	-
Net cash (used in) provided by financing activities							(42,570		)	133,105

EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	669			3,862			800			2,873

NET DECREASE IN CASH AND CASH EQUIVALENTS	(121,814		)	(318,316		)	(98,058		)	(301,639		)

CASH AND CASH EQUIVALENTS, beginning	161,573			342,394			161,573			342,394

CASH AND CASH EQUIVALENTS, ending	$	39,759		$	24,078		$	63,515		$	40,755

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid	$	20,130		$	16,078		$	38,374		$	34,652
Income taxes paid	$	21,347		$	9,710		$	36,433		$	11,498

The accompanying notes are an integral part of these statements.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)

~~(Unaudited)~~

General Information

The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with accounting principles generally accepted in the U.S. However, in the opinion of Briggs & Stratton Corporation, adequate disclosures have been presented to make the information not misleading, and all adjustments necessary to present fair statements of the results of operations and financial position have been included. All of these adjustments are of a normal recurring nature. These consolidated condensed financial statements should be read in conjunction with the financial statements and the notes thereto which were included in our latest Annual Report on Form 10-K.

Common Stock

On August 4, 2004, Briggs & Stratton’s board approved a two-for-one stock split of its common stock, which became effective on October 29, 2004 upon shareholder approval of the amendment to the Briggs & Stratton Corporation Articles of Incorporation. The stock split was payable on November 9, 2004 to shareholders of record as of October 29, 2004. The split was in the form of a stock dividend, with shareholders receiving an additional share for each existing share held. All references in the Consolidated Condensed Financial Statements to the number of common shares and related per share amounts reflect the effect of the stock split.

Briggs & Stratton purchased 753,500 shares at a total cost of $26.6 million during the three months ended April 2, 2006. There were no share repurchases made during fiscal 2005. The timing and amount of future purchases will be dependent upon the market price of the stock and certain governing loan covenants.

Accounts Receivable

During ~~the first quarter of~~ fiscal 2005, accounts receivable ~~included~~of $39 million from Murray, Inc., a major original equipment manufacturer. Based on information available at that time, the company assessed the account was not fully collectible and believed a $10 million reserve was sufficient to cover the estimated loss. Accordingly, an additional allowance for doubtful accounts of $10 million was recorded in the first quarter of fiscal 2005. Subsequent to the first quarter of fiscal 2005,manufacturer, were written-off. Murray Inc. filed for bankruptcy protection, ~~resulting in the write-off of the remaining $29 million in the second quarter of fiscal 2005.~~and Briggs & Stratton determined that these amounts were not collectible.

Earnings Per Share

Basic earnings per share, for each period presented, is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share, for each period presented, is computed reflecting the potential dilution that would occur if options or other contracts to issue common stock were exercised or converted into common stock at the beginning of the period.

Shares outstanding used to compute diluted earnings per share for the quarter and ~~six~~nine month ~~period~~periods ended ~~January 1,~~April 2, 2006 excluded ~~weighted average~~ outstanding options to purchase approximately ~~1,504,000~~1,434,000 and ~~1,422,000~~1,380,000 shares of common stock, respectively. ~~The impact of such common stock equivalents was excluded from the calculation of net income per share on a diluted basis as their effect is anti-dilutive.~~ In the prior fiscal year, no shares were excluded from the computation of diluted earnings per share for the ~~second~~third quarter and ~~six~~nine month periods.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

Information on earnings per share is as follows (in thousands):

	Three Months Ended				Six Months Ended				Three Months Ended				Nine Months Ended
	January 1,		December 26,		January 1,		December 26,		April 2,		March 27,		April 2,		March 27,
	2006		2004		2006		2004		2006		2005		2006		2005

Net income	$	21,818	$	7,060	$	26,545	$	5,572	$	60,008	$	80,624	$	86,553	$	86,196

Average shares of common stock outstanding	51,695		51,193		51,714		51,361		51,478		51,194		51,633		51,428

Incremental common shares applicable to common stock options based on the common stock average market price during the period	307		526		314		510		34		485		36		502

Incremental common shares applicable to restricted and deferred common stock based on the common stock average market price during the period	64		32		65		34		49		31		61		34

Diluted average shares of common stock outstanding	52,066		51,751		52,093		51,905		51,561		51,710		51,730		51,964

Comprehensive Income

Comprehensive income is a more inclusive financial reporting method that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income. Comprehensive income is defined as net income and other changes in shareholders’ investment from transactions and events other than with shareholders. Total comprehensive income (loss) is as follows (in thousands):

	Three Months Ended						Six Months Ended					Three Months Ended						Nine Months Ended
	January 1,			December 26,			January 1,		December 26,			April 2,			March 27,			April 2,			March 27,
	2006			2004			2006		2004			2006			2005			2006			2005

Net income	$	21,818		$	7,060		$	26,545	$	5,572		$	60,008		$	80,624		$	86,553		$	86,196

Cumulative translation adjustments	(735		)	3,105			85		3,519			(213		)	(46		)	(128		)	3,473
Unrealized (loss) gain on derivative instruments	(3,417		)	(853		)	2,410		(1,258		)	(3,053		)	1,050			(643		)	(208		)
Total comprehensive income	$	17,666		$	9,312		$	29,040	$	7,833		$	56,742		$	81,628		$	85,782		$	89,461

The components of Accumulated Other Comprehensive Income (Loss) are as follows (in thousands):


	January 1,			July 3,				April 2,			July 3,
	2006			2005				2006			2005

Cumulative translation adjustments	$	5,824		$	5,739			$	5,611		$	5,739
Unrealized gain on derivative instruments	3,329			919				276			919
Minimum pension liability adjustment	(54,989		)	(54,989			)	(54,989		)	(54,989		)
Accumulated other comprehensive loss	$	(45,836	)	$		(48,331	)	$	(49,102	)	$	(48,331	)

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

Derivatives

Derivatives are recorded on the balance sheet as assets or liabilities, measured at fair value. Briggs & Stratton enters into derivative contracts designated as cash flow hedges to manage its foreign currency exposures. These instruments generally do not have a maturity of more than twelve months.

Changes in the fair value of cash flow hedges are recorded on the Consolidated Condensed Statements of Income or as a component of Accumulated Other Comprehensive Income (Loss). The amounts included in Accumulated Other Comprehensive Income (Loss) will be reclassified into income when the forecasted transactions occur, generally within the next twelve months. These forecasted transactions represent the exporting of products for which Briggs & Stratton will receive foreign currency and the importing of products for which it will be required to pay in a foreign currency. Changes in the fair value of all derivatives deemed to be ineffective are recorded as either income or expense in the accompanying Consolidated Condensed Statements of Income.

Briggs & Stratton manages its exposure to fluctuation in the cost of natural gas used by its operating facilities through participation in a third party managed dollar cost averaging program linked to NYMEX futures. As a participant in the program, Briggs & Stratton hedges a minimum of 50% of its anticipated monthly natural gas usage along with a pool of other companies. Briggs & Stratton does not hold any actual futures contracts and actual delivery of natural gas is not required of the participants in the program. Cash settlements occur on a monthly basis based on the difference between the average dollar price of the underlying NYMEX futures held by the third party and the actual price of natural gas paid by Briggs & Stratton in the period. The fair value of the underlying NYMEX futures is reflected as an asset or liability on the accompanying Consolidated Condensed Balance Sheets. Changes in fair value are reflected as a Component of Accumulated Other Comprehensive Income (Loss), which are reclassified into the income statement as the monthly cash settlements occur and actual natural gas is consumed.

Reduction in Force

Briggs & Stratton recorded an expense of approximately $3.7 million associated with a worldwide employee reduction during the quarter ended April 2, 2006. The amount recorded represents expected expenditures for severance and other related employee separation costs associated with the reduction. As of the quarter ended April 2, 2006, a reserve of $2.3 million remained.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

Segment and Geographic Information

Briggs & Stratton operates two reportable business segments that are managed separately based on fundamental differences in their operations. Summarized segment data is as follows (in thousands):

	Three Months Ended						Six Months Ended						Three Months Ended						Nine Months Ended
	January 1,			December 26,			January 1,			December 26,			April 2,			March 27,			April 2,			March 27,
	2006			2004			2006			2004			2006			2005			2006			2005
NET SALES:
Engines	$	380,901		$	374,874		$	666,330		$	628,986		$	597,608		$	604,866		$	1,263,938		$	1,233,852
Power Products	256,609			169,108			557,216			391,262			287,766			323,650			844,982			714,912
Inter-Segment Eliminations	(63,197		)	(40,282		)	(137,524		)	(77,553		)	(85,180		)	(88,053		)	(222,704		)	(165,606		)
Total*	$	574,313		$	503,700		$	1,086,022		$	942,695		$	800,194		$	840,463		$	1,886,216		$	1,783,158

* International Sales (included in above)
Engines	$	121,398		$	102,718		$	214,699		$	156,804		$	150,439		$	144,846		$	365,138		$	301,650
Power Products	28,153			7,997			50,389			15,159			19,268			29,259			70,173			44,418
Total	$	149,551		$	110,715		$	265,088		$	171,963		$	169,707		$	174,105		$	435,311		$	346,068

GROSS PROFIT ON SALES:
Engines	$	93,503		$	88,681		$	153,187		$	132,926		$	148,598		$	133,710		$	301,785		$	266,636
Power Products	26,472			17,849			45,976			42,047			37,490			34,741			83,466			76,788
Inter-Segment Eliminations	(2,623		)	(388		)	(503		)	1,987			(5,155		)	(2,723		)	(5,658		)	(736		)
Total	$	117,352		$	106,142		$	198,660		$	176,960		$	180,933		$	165,728		$	379,593		$	342,688

INCOME (LOSS) FROM OPERATIONS:
Engines	$	35,699		$	14,528		$	44,466		$	9,852		$	88,794		$	85,522		$	133,260		$	95,374
Power Products	5,554			(656		)	5,698			4,503			14,551			14,685			20,249			19,188
Inter-Segment Eliminations	(2,623		)	(388		)	(503		)	1,987			(5,155		)	(2,723		)	(5,658		)	(736		)
Total	$	38,630		$	13,484		$	49,661		$	16,342		$	98,190		$	97,484		$	147,851		$	113,826

Warranty

Briggs & Stratton recognizes the cost associated with its standard warranty on Engines and Power Products at the time of sale. The amount recognized is based on historical failure rates and current claim cost experience. The following is a reconciliation of the changes in accrued warranty costs for the reporting period (in thousands):

	Six Months Ended						Three Months Ended
	January 1,			December 26,			April 2,			March 27,
	2006			2004			2006			2005
Beginning balance	$	59,625		$	43,148		$	59,625		$	43,148
Balance related to acquisition	-			8,773			-			12,273
Payments	(21,680		)	(18,603		)	(29,371		)	(27,476		)
Provision for current year warranties	18,302			19,125			26,460			30,197
Adjustments to prior years’ warranties	(5,087		)	(1,784		)	(3,587		)	(238		)
Ending balance	$	51,160		$	50,659		$	53,127		$	57,904

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

Stock Incentives

~~The Company had a Stock Incentive Plan under which 5,361,935 shares of common stock were reserved for issuance.~~ Effective October 20, 2004, ~~the Company~~Briggs & Stratton adopted an Incentive Compensation Plan under which 4,000,000 shares of common stock (8,000,000 shares as a result of the 2-for-1 stock split) were reserved for future issuance. Briggs & Stratton previously had a Stock Incentive Plan under which 5,361,935 shares of common stock were reserved for issuance. The adoption of ~~this~~the Incentive Compensation Plan reduced the number of shares available for future issuance under the Stock Incentive Plan to zero. However, as of ~~January 1,~~April 2, 2006, and July 3, 2005, there were ~~3,002,788~~2,751,556 and 3,092,168 outstanding option and restricted stock awards granted under the Stock Incentive Plan, respectively, that are or may become exercisable in the future. In accordance with both plans, ~~the Company~~Briggs & Stratton can issue eligible employees stock options, stock appreciation rights, restricted stock, deferred stock and cash bonus awards subject to certain annual limitations. The plans also allow ~~the Company~~Briggs & Stratton to issue ~~directors~~Directors non-qualified stock options and directors’ fees in stock.

Effective July 4, 2005, Briggs & Stratton’s Incentive Compensation Plan isand shares issued under the Stock Incentive Plan are accounted for under Statement of Financial Accounting Standards (“SFAS”) No. 123R, “Share Based Payment”. During the quarter and nine months ended ~~January 1,~~April 2, 2006, ~~the Company~~Briggs & Stratton recognized ~~approximately $1.9 million in~~ stock option compensation expense of approximately $1.9 million and ~~approximately $3.8~~$5.7 million, ~~during the six months ended January 1, 2006.~~respectively. Prior to July 4, 2005, the ~~plan was~~plans were accounted for according to Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees”. Thus, no compensation cost was recognized prior to fiscal ~~year~~ 2006. Had compensation cost for ~~this plan~~the plans been determined consistent with SFAS No. 123R, ~~the Company’s~~Briggs & Stratton’s net income and earnings per share would have been reduced to the following pro forma amounts (in thousands, except per share data):

	Three Months Ended			Six Months Ended
	December 26,			December 26,			Three Months Ended			Nine Months Ended
	2004			2004			March 27,			March 27,
							2005			2005
Net income as reported:	$	7,060		$	5,572		$	80,624		$	86,196
Deduct employee compensation expense
determined under a fair value based
method, net of related tax effects	(1,471		)	(2,461		)
Deduct employee compensation expense determined under a fair value based method, net of related tax effects							(1,321		)	(3,781		)
Pro forma net income	$	5,589		$	3,111		$	79,303		$	82,415

Basic earnings per share:
As reported	$	0.14		$	0.11		$	1.57		$	1.67
Pro forma	$	0.11		$	0.06		$	1.55		$	1.60

Diluted earnings per share:
As reported	$	0.14		$	0.11		$	1.56		$	1.66
Pro forma	$	0.11		$	0.06		$	1.55		$	1.59

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

The exercise price of each stock option issued is in excess of the market value of the stock on the date of grant. The fair value of each option is estimated using the Black-Scholes option pricing model. The grant-date fair market value of the options and assumptions used to determine such value are:

Options Granted During	2006			2005
Options Granted During Fiscal							2006			2005

Grant Date Fair Value*	$	7.37		$	12.12		$	7.37		$	12.12
Assumptions:
Risk-free Interest Rate	4.3		%	4.2		%	4.3		%	4.2		%
Expected Volatility	25.1		%	28.4		%	25.1		%	28.4		%
Expected Dividend Yield	1.9		%	1.9		%	1.9		%	1.9		%
Expected Term (In Years)	5.0			10.0			5.0			10.0

* Share data adjusted for effect of 2-for-1 stock split effective October 29, 2004.

Information on the options outstanding is as follows:

			Wtd. Avg.
	Shares*		Ex. Price
Balance, June 27, 2004	2,498,290		$	28.27

Granted During the Year	1,149,340		36.68
Exercised During the Year	(622,262	)	32.67
Expired During the Year	(18,200	)	37.27
Balance, July 3, 2005	3,007,168		$	30.52

Granted During the First Nine Months	355,123		38.83
Exercised During the First Nine Months	(330,612	)	27.71
Expired During the First Nine Months	-		-
Balance, April 2, 2006	3,031,679		$	31.81

Wtd. Avg.

Shares*

Ex. Price

Balance, June 27, 2004

2,498,290

$
28.27

Granted During the Year

1,149,340

36.68

Exercised During the Year

(622,262
)
32.67

Expired During the Year

(18,200
)
37.27

Balance, July 3, 2005

3,007,168

$
30.52

Granted During the First Six Months

355,123

38.83

Exercised During the First Six Months

(80,380
)
29.44

Expired During the First Six Months

-

-

Balance, January 1, 2006

3,281,911

$
31.46

Grant Summary*	Grant Summary*							Grant Summary*
Fiscal		Grant	Date	Expiration	Exercise		Options		Grant	Date	Expiration	Exercise		Options
Year		Date	Exercisable	Date	Price		Outstanding		Date	Exercisable	Date	Price		Outstanding
2001		8-3-00	8-3-03	8-3-07	$	23.11	319,348		8-3-00	8-3-03	8-3-07	$	23.11	178,034
2002		8-7-01	8-7-04	8-7-08	24.60		397,200		8-7-01	8-7-04	8-7-08	24.60		358,552
2003		8-13-02	8-13-05	8-13-09	23.35		302,580		8-13-02	8-13-05	8-13-09	23.35		302,580
2004		8-15-03	8-15-06	8-15-13	30.44		758,320		8-15-03	8-15-06	8-15-13	30.44		758,320
2005		8-13-04	8-13-07	8-13-14	36.68		1,149,340		8-13-04	8-13-07	8-13-14	36.68		1,079,070
2006		8-16-05	8-16-08	8-16-10	38.83		355,123		8-16-05	8-16-08	8-16-10	38.83		355,123

* Share data adjusted for effect of 2-for-1 stock split effective October 29, 2004.

Under the plans, ~~the Company~~Briggs & Stratton has issued restricted stock to certain employees. During the ~~six~~nine months ended ~~January 1,~~April 2, 2006, ~~the Company~~Briggs & Stratton issued ~~38,574~~40,574 shares. During fiscal year 2005, ~~the Company~~Briggs & Stratton issued 26,000 shares. The restricted stock vests on the fifth anniversary date of issue provided that the recipient is still employed by ~~the Company.~~Briggs & Stratton. The aggregate market value on the date of issue of ~~$1.3~~$1.4 million during the ~~six~~nine months ended ~~January 1,~~April 2, 2006 and $1.0 million in fiscal 2005 has been recorded as ~~unearned compensation,~~Unearned Compensation, a separate component of the Shareholders’ Investment section of the Consolidated Balance Sheets, and is being amortized over the five-year vesting period.

Under the plans, ~~the Company~~Briggs & Stratton may also issue stock to its directors in lieu of directors’ fees. ~~The Company~~Briggs & Stratton has issued ~~2,800~~3,477 and 3,463 shares during the ~~six~~nine months ended ~~January 1,~~April 2, 2006 and the twelve months ended July 3, 2005, respectively.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

Under the Incentive Compensation Plan, ~~the Company~~Briggs & Stratton may also issue deferred stock to its officers and key employees. Under this provision, ~~the Company~~Briggs & Stratton issued ~~24,905~~27,905 and 1,000 shares during the ~~six~~nine months ended ~~January 1,~~April 2, 2006 and the twelve months ended July 3, 2005, respectively. The aggregate market value on the date of issue was ~~$871,000~~$990,000 and $34,000 for the ~~six~~nine months ended ~~January 1,~~April 2, 2006 and the twelve months ended July 3, 2005, respectively. Expense is recognized ratably over the five-year vesting period.

~~BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES~~

Pension and Postretirement Benefits

Briggs & Stratton has noncontributory, defined benefit retirement plans and postretirement plans covering certain employees. The following tables summarize the plans’ income and expense for the periods indicated (in thousands):

	Pension Benefits						Other Postretirement Benefits
	Three Months Ended						Three Months Ended					Pension Benefits						Other Postretirement Benefits
	January 1,			December 26,			January 1,			December 26,		Three Months Ended						Three Months Ended
	2006			2004			2006			2004		April 2,			March 27,			April 2,			March 27,
												2006			2005			2006			2005
Components of net periodic expense:
Service cost-benefits earned	$	3,693		$	3,017		$	639		$	609	$	3,858		$	3,243		$	758		$	678
Interest cost on projected benefit obligation	13,202			13,502			3,686			4,172		13,149			13,611			3,756			4,176
Expected return on plan assets	(17,294		)	(17,339		)	-			-		(17,250		)	(17,700		)	-			-
Amortization of:
Transition obligation	2			-			12			12		2			-			12			12
Prior service cost	872			785			(323		)	7		823			785			(157		)	8
Actuarial loss	2,426			245			3,862			3,766		2,563			194			3,948			3,531
Net periodic expense	$	2,901		$	210		$	7,876		$	8,566	$	3,145		$	133		$	8,317		$	8,405

Pension Benefits

Other Postretirement Benefits

Six Months Ended

Six Months Ended

January 1,

December 26,

January 1,

December 26,

2006

2004

2006

2004

Components of net periodic expense:

Service cost-benefits earned

$
7,715

$
6,487

$
1,515

$
1,372

Interest cost on projected benefit obligation

26,298

27,222

7,513

8,351

Expected return on plan assets

(34,499
)

(35,400
)

-

-

Amortization of:

Transition obligation

4

-

23

23

Prior service cost

1,646

1,570

(315
)

15

Actuarial loss

5,127

388

7,897

7,156

Net periodic expense

$
6,291

$
267

$
16,633

$
16,917

	Pension Benefits						Other Postretirement Benefits
	Nine Months Ended						Nine Months Ended
	April 2,			March 27,			April 2,			March 27,
	2006			2005			2006			2005
Components of net periodic expense:
Service cost-benefits earned	$	11,572		$	9,730		$	2,273		$	2,050
Interest cost on projected benefit obligation	39,447			40,833			11,269			12,527
Expected return on plan assets	(51,749		)	(53,100		)	-			-
Amortization of:
Transition obligation	6			-			35			35
Prior service cost	2,469			2,355			(472		)	23
Actuarial loss	7,690			582			11,845			10,687
Net periodic expense	$	9,435		$	400		$	24,950		$	25,322

Employer Contributions:

There were no contributions made to the plan for the quarters ended ~~January 1,~~April 2, 2006 and ~~December 26, 2004.~~March 27, 2005. Briggs & Stratton is not required to make any contributions to the pension plans in fiscal 2006.

Estimated Benefit Payments:

Briggs & Stratton expects to make benefit payments of approximately $1.6 million for its non-qualified pension plan during fiscal 2006. As of ~~January 1,~~April 2, 2006, Briggs & Stratton had made payments of approximately ~~$0.9~~$1.3 million. Briggs & Stratton anticipates benefit payments of approximately $27.3 million for its other postretirement benefit plans during fiscal 2006. As of ~~January 1,~~April 2, 2006, Briggs & Stratton had made payments of approximately ~~$14.4~~$21.4 million.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

Commitments and Contingencies

Briggs & Stratton is subject to various unresolved legal actions that arise in the normal course of its business. These actions typically relate to product liability (including asbestos-related liability), patent and trademark matters, and disputes with customers, suppliers, distributors and dealers, competitors and employees.

On January 14, 2005, ~~the Company~~Briggs & Stratton filed a lawsuit against Kohler Co. (Briggs & Stratton Corporation v. Kohler Co., No 05-C-0025-C (U.S. District Court, Western District of Wisconsin)) alleging Kohler’s single-cylinder Courage engine infringes two of ~~the Company’s~~Briggs & Stratton’s U.S. patents. Kohler filed counterclaims against ~~the Company~~Briggs & Stratton on April 15, 2005, alleging that ~~the Company’s~~Briggs & Stratton’s pricing and contracting practices violate federal antitrust laws and related state laws. ~~The Company’s~~Briggs & Stratton’s infringement claims ~~are scheduled for trial~~were tried before a jury in February ~~2006,~~2006. The jury found that the Kohler engine infringes one of Briggs & Stratton’s patents but the patent is invalid, and Briggs & Stratton and Kohler have each filed motions to overturn the jury verdict. Kohler’s counterclaims are scheduled for trial in September 2006.

On June 3, 2004, eight individuals who claim to have purchased lawnmowers in Illinois and Minnesota filed a lawsuit (Ronnie Phillips et al. v. Sears Roebuck Corporation et al., No. 04-L-334 (20th Judicial Circuit, St. Clair County, IL)) against ~~the Company~~Briggs & Stratton and other defendants alleging that the horsepower labels on the products they purchased were inaccurate. The plaintiffs seek certification of a class of all persons in the United States who, beginning January 1, 1995 through the present, purchased a lawnmower containing a two stroke or four stroke gas combustion engine up to 20 horsepower that was manufactured by the defendants. The complaint seeks an injunction, compensatory and punitive damages, and attorneys’ fees. On April 20, 2005, the court issued a stay with respect to this case pending settlement negotiations.

Although it is not possible to predict with certainty the outcome of these unresolved legal actions or the range of possible loss, Briggs & Stratton believes these unresolved legal actions will not have a material effect on its financial position. Briggs & Stratton currently does not have enough information to estimate the impact that these matters may have on its future results of operations.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

Financial Information of Subsidiary Guarantor of Indebtedness

In June 1997, Briggs & Stratton issued $100 million of 7.25% senior notes; in May 2001, ~~the Company~~Briggs & Stratton issued $275 million of 8.875% senior notes; and in February 2005, ~~the Company~~Briggs & Stratton issued $125 million of variable rate term notes. In addition, Briggs & Stratton has a $350 million revolving credit facility that expires in May 2009 that is used to finance seasonal working capital needs.

Under the terms of Briggs & Stratton’s 8.875% senior notes, 7.25% senior notes, variable rate term notes, and the revolving credit agreement (collectively, the “Domestic Indebtedness”), Briggs & Stratton Power Products Group, LLC and its wholly owned subsidiary, Simplicity Manufacturing, Inc., are joint and several guarantors of the Domestic Indebtedness (the “Guarantor”). The guarantees are full and unconditional guarantees. Additionally, if at any time a domestic subsidiary of Briggs & Stratton constitutes a significant domestic subsidiary, then such domestic subsidiary will also become a guarantor of the Domestic Indebtedness. Currently, all of the Domestic Indebtedness is unsecured. If Briggs & Stratton were to fail to make a payment of interest or principal on its due date, the Guarantor is obligated to pay the outstanding Domestic Indebtedness. Briggs & Stratton had the following outstanding amounts related to the guaranteed debt (in thousands):

	January 1, 2006		Maximum		April 2, 2006		Maximum
	Carrying Amount		Guarantee		Carrying Amount		Guarantee

8.875% Senior Notes, due March 15, 2011	$	267,072	$	270,000	$	267,212	$	270,000

7.25% Senior Notes, due September 15, 2007	$	89,682	$	90,000	$	89,728	$	90,000

Variable Rate Term Notes, due February 11, 2008	$	125,000	$	125,000	$	125,000	$	125,000

Revolving Credit Facility, expiring May 2009	$	134,865	$	350,000	$	-	$	350,000

The following condensed supplemental consolidating financial information reflects the summarized financial information of Briggs & Stratton, its Guarantor and Non-Guarantor Subsidiaries (in thousands):

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

BALANCE SHEET

As of ~~January 1,~~April 2, 2006

	Briggs & Stratton		Guarantor		Non-Guarantor							Briggs & Stratton		Guarantor		Non-Guarantor
	Corporation		Subsidiary		Subsidiaries		Eliminations			Consolidated		Corporation		Subsidiary		Subsidiaries		Eliminations			Consolidated

Current assets	$	935,347	$	513,875	$	179,722	$	(353,349	)	$	1,275,595	$	718,721	$	762,154	$	201,538	$	(468,221	)	$	1,214,192
Investment in subsidiaries	776,105		-		-		(776,105		)	-		788,653		-		-		(788,653		)	-
Non-current assets	404,264		448,505		16,910		-			869,679		404,709		446,741		17,268		-			868,718
	$	2,115,716	$	962,380	$	196,632	$	(1,129,454	)	$	2,145,274	$	1,912,083	$	1,208,895	$	218,806	$	(1,256,874	)	$	2,082,910

Current liabilities	$	584,461	$	156,402	$	128,012	$	(340,202	)	$	528,673	$	346,747	$	392,360	$	147,688	$	(450,703	)	$	436,092
Long-term debt	441,754		-		-		-			441,754		441,940		-		-		-			441,940
Other long-term obligations	173,987		98,216		277		-			272,480		174,914		98,719		281		-			273,914
Shareholders' investment	915,514		707,762		68,343		(789,252		)	902,367
Shareholders’ investment												948,482		717,816		70,837		(806,171		)	930,964
	$	2,115,716	$	962,380	$	196,632	$	(1,129,454	)	$	2,145,274	$	1,912,083	$	1,208,895	$	218,806	$	(1,256,874	)	$	2,082,910

BALANCE SHEET

As of July 3, 2005

	Briggs & Stratton		Guarantor		Non-Guarantor							Briggs & Stratton		Guarantor		Non-Guarantor
	Corporation		Subsidiary		Subsidiaries		Eliminations			Consolidated		Corporation		Subsidiary		Subsidiaries		Eliminations			Consolidated

Current assets	$	702,178	$	424,473	$	185,436	$	(192,882	)	$	1,119,205	$	702,178	$	424,473	$	185,436	$	(192,882	)	$	1,119,205
Investment in subsidiaries	770,539		-		-		(770,539		)	-		770,539		-		-		(770,539		)	-
Non-current assets	416,503		447,986		15,274		-			879,763		416,503		447,986		15,274		-			879,763
	$	1,889,220	$	872,459	$	200,710	$	(963,421	)	$	1,998,968	$	1,889,220	$	872,459	$	200,710	$	(963,421	)	$	1,998,968

Current liabilities	$	328,914	$	74,890	$	130,483	$	(181,619	)	$	352,668	$	328,914	$	74,890	$	130,483	$	(181,619	)	$	352,668
Long-term debt	486,321		-		-		-			486,321		486,321		-		-		-			486,321
Other long-term obligations	173,536		96,974		283		-			270,793		173,536		96,974		283		-			270,793
Shareholders' investment	900,449		700,595		69,944		(781,802		)	889,186
Shareholders’ investment												900,449		700,595		69,944		(781,802		)	889,186
	$	1,889,220	$	872,459	$	200,710	$	(963,421	)	$	1,998,968	$	1,889,220	$	872,459	$	200,710	$	(963,421	)	$	1,998,968

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

STATEMENT OF INCOME

For the Three Months Ended ~~January 1,~~April 2, 2006

	Briggs & Stratton			Guarantor			Non-Guarantor
	Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated			Briggs & Stratton			Guarantor			Non-Guarantor
																Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated
Net sales	$	372,267		$	254,327		$	48,315		$	(100,596	)	$	574,313		$	585,925		$	280,504		$	47,443		$	(113,678	)	$	800,194
Cost of goods sold	283,960			227,466			40,457			(94,922		)	456,961			445,238			245,779			37,187			(108,943		)	619,261
Gross profit	88,307			26,861			7,858			(5,674		)	117,352			140,687			34,725			10,256			(4,735		)	180,933
Engineering, selling, general and administrative expenses	50,335			20,139			8,248			-			78,722
Engineering, selling, general an administrative expensesd																53,126			21,895			7,722			-			82,743
Income (Loss) from operations	37,972			6,722			(390		)	(5,674		)	38,630			87,561			12,830			2,534			(4,735		)	98,190
Interest expense	(13,380		)	(17		)	(89		)	2,181			(11,305		)	(10,764		)	(11		)	(43		)	(75		)	(10,893		)
Other income (expense), net	7,097			2,411			(247		)	(3,038		)	6,223			8,844			295			(150		)	(7,481		)	1,508
Income (Loss) before income taxes	31,689			9,116			(726		)	(6,531		)	33,548			85,641			13,114			2,341			(12,291		)	88,805
Provision (Credit) for income taxes	11,091			2,503			(644		)	(1,220		)	11,730			27,756			3,061			103			(2,123		)	28,797
Net income (loss)	$	20,598		$	6,613		$	(82	)	$	(5,311	)	$	21,818		$	57,885		$	10,053		$	2,238		$	(10,168	)	$	60,008

STATEMENT OF INCOME

For the ~~Six~~Nine Months Ended ~~January 1,~~April 2, 2006

	Briggs & Stratton			Guarantor			Non-Guarantor
	Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated			Briggs & Stratton			Guarantor			Non-Guarantor
																Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated
Net sales	$	639,308		$	552,186		$	98,620		$	(204,092	)	$	1,086,022		$	1,225,233		$	832,690		$	146,063		$	(317,770	)	$	1,886,216
Cost of goods sold	498,489			507,929			81,997			(201,053		)	887,362			943,727			753,708			119,184			(309,996		)	1,506,623
Gross profit	140,819			44,257			16,623			(3,039		)	198,660			281,506			78,982			26,879			(7,774		)	379,593
Engineering, selling, general and administrative expenses	93,258			38,428			17,313			-			148,999			146,384			60,323			25,035			-			231,742
Income (Loss) from operations	47,561			5,829			(690		)	(3,039		)	49,661			135,122			18,659			1,844			(7,774		)	147,851
Interest expense	(24,751		)	(31		)	(142		)	3,591			(21,333		)	(35,515		)	(42		)	(185		)	3,516			(32,226		)
Other income (expense), net	14,808			4,187			(1,235		)	(5,273		)	12,487			23,652			4,482			(1,385		)	(12,754		)	13,995
Income (Loss) before income taxes	37,618			9,985			(2,067		)	(4,721		)	40,815			123,259			23,099			274			(17,012		)	129,620
Provision (Credit) for income taxes	13,166			3,201			(4		)	(2,093		)	14,270			40,922			6,262			99			(4,216		)	43,067
Net income (loss)	$	24,452		$	6,784		$	(2,063	)	$	(2,628	)	$	26,545		$	82,337		$	16,837		$	175		$	(12,796	)	$	86,553

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

STATEMENT OF INCOME

For the Three Months Ended ~~December 26, 2004~~March 27, 2005

	Briggs & Stratton			Guarantor			Non-Guarantor									Briggs & Stratton			Guarantor			Non-Guarantor
	Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated			Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated

Net sales	$	362,167		$	187,561		$	39,773		$	(85,801	)	$	503,700		$	587,013		$	332,930		$	43,055		$	(122,535	)	$	840,463
Cost of goods sold	282,443			169,537			28,483			(82,905		)	397,558			458,363			299,889			37,416			(120,933		)	674,735
Gross profit	79,724			18,024			11,290			(2,896		)	106,142			128,650			33,041			5,639			(1,602		)	165,728
Engineering, selling, general and administrative expenses	67,060			18,320			7,278			-			92,658			40,365			19,775			8,104			-			68,244
Income (Loss) from operations	12,664			(296		)	4,012			(2,896		)	13,484			88,285			13,266			(2,465		)	(1,602		)	97,484
Interest (income) expense	(8,690		)	4			(31		)	(78		)	(8,795		)
Interest expense																(10,175		)	(3		)	(18		)	(44		)	(10,240		)
Other income (expense), net	6,205			344			93			(561		)	6,081			28,653			304			159			(24,186		)	4,930
Income (Loss) before income taxes	10,179			52			4,074			(3,535		)	10,770			106,763			13,567			(2,324		)	(25,832		)	92,174
Provision (Credit) for income taxes	3,551			67			524			(432		)	3,710			36,299			5,177			34			(10,160		)	31,350
Income Before Extraordinary Item																70,464			8,390			(2,358		)	(15,672		)	60,824
Extraordinary Gain																-			19,800			-			-			19,800
Net income (loss)	$	6,628		$	(15	)	$	3,550		$	(3,103	)	$	7,060		$	70,464		$	28,190		$	(2,358	)	$	(15,672	)	$	80,624

STATEMENT OF INCOME

For The ~~Six~~Nine Months Ended ~~December 26, 2004~~March 27, 2005

	Briggs & Stratton			Guarantor			Non-Guarantor									Briggs & Stratton			Guarantor			Non-Guarantor
	Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated			Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated

Net sales	$	604,332		$	422,736		$	77,232		$	(161,605	)	$	942,695		$	1,191,345		$	755,666		$	120,287		$	(284,140	)	$	1,783,158
Cost of goods sold	487,661			380,469			57,547			(159,942		)	765,735			946,024			680,358			94,963			(280,875		)	1,440,470
Gross profit	116,671			42,267			19,685			(1,663		)	176,960			245,321			75,308			25,324			(3,265		)	342,688
Engineering, selling, general and administrative expenses	109,244			37,210			14,164			-			160,618			149,609			56,985			22,268			-			228,862
Income (Loss) from operations	7,427			5,057			5,521			(1,663		)	16,342			95,712			18,323			3,056			(3,265		)	113,826
Interest (income) expense	(16,265		)	(24		)	(72		)	(553		)	(16,914		)
Interest expense																(26,440		)	(27		)	(90		)	(597		)	(27,154		)
Other income (expense), net	14,508			(44		)	11			(5,461		)	9,014			43,161			260			170			(29,647		)	13,944
Income (Loss) before income taxes	5,670			4,989			5,460			(7,677		)	8,442			112,433			18,556			3,136			(33,509		)	100,616
Provision (Credit) for income taxes	1,928			1,973			799			(1,830		)	2,870			38,227			7,150			833			(11,990		)	34,220
Income Before Extraordinary Item																74,206			11,406			2,303			(21,519		)	66,396
Extraordinary Gain																-			19,800			-			-			19,800
Net income (loss)	$	3,742		$	3,016		$	4,661		$	(5,847	)	$	5,572		$	74,206		$	31,206		$	2,303		$	(21,519	)	$	86,196

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

STATEMENT OF CASH FLOWS

For the ~~Six~~Nine Months Ended ~~January 1,~~April 2, 2006

	Briggs & Stratton			Guarantor			Non-Guarantor									Briggs & Stratton			Guarantor			Non-Guarantor
	Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated			Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated
Net Cash (Used in) Provided by Operating Activities	$	(316,478	)	$	81,152		$	(3,264	)	$	10,713		$	(227,877	)
Net Cash Provided by (Used in) Operating Activities																$	16,201		$	(54,083	)	$	5,363		$	11,857		$	(20,662	)

Cash Flows from Investing Activities:
Additions to plant and equipment	(23,427		)	(8,532		)	(2,395		)	-			(34,354		)	(35,058		)	(11,529		)	(2,822		)	-			(49,409		)
Proceeds received on sale of plant and equipment	10,641			46			9			-			10,696
Proceeds received on sale of assets																10,761			46			29			-			10,836
Cash investment in subsidiary	(382		)	-			-			382			-			(391		)	-			9			382			-
Investment in joint venture	(900		)	-			-			-			(900		)	(900		)	-			-			-			(900		)
Refund of cash paid for acquisition	-			6,347			-			-			6,347			-			6,347									6,347
Loan receivable																(2,500		)	-			-			-			(2,500		)
Net Cash (Used in) Provided by Investing Activities	(14,068		)	(2,139		)	(2,386		)	382			(18,211		)	(28,088		)	(5,136		)	(2,784		)	382			(35,626		)

Cash Flows from Financing Activities:
Net borrowings (repayments) on loans and notes payable	211,655			(81,771		)	13,445			(10,712		)	132,617
Net (repayments) borrowings on loans and notes payable																(62,422		)	57,457			14,410			(11,856		)	(2,411		)
Dividends	(11,379		)	-			-			-			(11,379		)	(22,760		)	-			-			-			(22,760		)
Proceeds from exercise of stock options	2,367			-			-			-			2,367			9,160			-			-			-			9,160
Treasury stock purchases																(26,559		)	-			-			-			(26,559		)
Capital contributions received	-			383			-			(383		)	-			-			383			-			(383		)	-
Net Cash Provided by (Used in) Financing Activities	202,643			(81,388		)	13,445			(11,095		)	123,605
Net Cash (Used in) Provided by Financing Activities																(102,581		)	57,840			14,410			(12,239		)	(42,570		)

Effect of Foreign Currency Exchange Rate Changes on Cash and Cash Equivalents	-			-			669			-			669			-			-			800			-			800

Net (Decrease) Increase in Cash and Cash Equivalents	(127,903		)	(2,375		)	8,464			-			(121,814		)	(114,468		)	(1,379		)	17,789			-			(98,058		)
Cash and Cash Equivalents, Beginning	143,034			6,376			12,163			-			161,573			143,034			6,376			12,163			-			161,573
Cash and Cash Equivalents, Ending	$	15,131		$	4,001		$	20,627		$	-		$	39,759		$	28,566		$	4,997		$	29,952		$	-		$	63,515

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

STATEMENT OF CASH FLOWS

For the ~~Six~~Nine Months Ended ~~December 26, 2004~~March 27, 2005

	Briggs & Stratton			Guarantor			Non-Guarantor									Briggs & Stratton			Guarantor			Non-Guarantor
	Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated			Corporation			Subsidiary			Subsidiaries			Eliminations			Consolidated
Net Cash (Used in) Provided by Operating Activities	$	(280,652	)	$	55,133		$	(5,640	)	$	(2,810	)	$	(233,969	)	$	(71,857	)	$	39,120		$	(3,832	)	$	6,715		$	(29,854	)

Cash Flows from Investing Activities:
Additions to plant and equipment	(28,503		)	(5,659		)	(5,220		)	-			(39,382		)	(45,094		)	(9,222		)	(6,711		)	-			(61,027		)
Proceeds received on sale of plant and equipment	325			4			3			-			332
Proceeds received on sale of
certain assets of a subsidiary	-			-			4,050			-			4,050
Proceeds received on sale of plant assets																557			10			4,241			-			4,808
Capital contributions to subsidiary	(244,561		)	-			(1		)	244,562			-			(369,148		)	-			(12,469		)	381,617			-
Investment in Joint Venture																(1,500		)	-			-			-			(1,500		)
Cash paid for acquisition, net of cash acquired	(719		)	(222,394		)	-			-			(223,113		)	(719		)	(332,662		)	(16,663		)	-			(350,044		)
Net Cash (Used in) Provided by Investing Activities	(273,458		)	(228,049		)	(1,168		)	244,562			(258,113		)	(415,904		)	(341,874		)	(31,602		)	381,617			(407,763		)

Cash Flows from Financing Activities:
Net borrowings (repayments) on loans and notes payable	229,772			(67,673		)	1,030			(2,179		)	160,950			177,691			(44,969		)	11,317			(12,469		)	131,570
Dividends	(8,694		)	-			(4,989		)	4,989			(8,694		)	(17,455		)	-			(5,801		)	5,754			(17,502		)
Proceeds from exercise of stock options	17,648			-			-			-			17,648			19,037			-			-			-			19,037
Capital contributions received	-			239,277			5,285			(244,562		)	-			-			349,542			32,075			(381,617		)	-
Net Cash Provided by (Used in) Financing Activities	238,726			171,604			1,326			(241,752		)	169,904			179,273			304,573			37,591			(388,332		)	133,105
Effect of Foreign Currency Exchange Rate
Changes on Cash and Cash Equivalents																-			-			2,873			-			2,873

Effect of Foreign Currency Exchange Rate Changes on Cash and Cash Equivalents	(1		)	-			3,863			-			3,862

Net Decrease in Cash and Cash Equivalents	(315,385		)	(1,312		)	(1,619		)	-			(318,316		)
Net (Decrease) Increase in Cash and Cash Equivalents																(308,488		)	1,819			5,030			-			(301,639		)
Cash and Cash Equivalents, Beginning	326,809			4,007			11,578			-			342,394			326,809			4,007			11,578			-			342,394
Cash and Cash Equivalents, Ending	$	11,424		$	2,695		$	9,959		$	-		$	24,078		$	18,321		$	5,826		$	16,608		$	-		$	40,755

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following is management’s discussion and analysis of Briggs & Stratton’s financial condition and results of operations for the periods included in the accompanying consolidated condensed financial statements:

RESULTS OF OPERATIONS

SALES

Consolidated net sales for the ~~second~~third quarter of fiscal 2006 totaled ~~$574~~$800 million, ~~an increase~~a decrease of ~~$70~~$40 million or ~~14%~~5% when compared to fiscal 2005. The ~~increase~~decrease is ~~driven by improved sales performance of~~attributable to a reduction in Murray related lawn and garden equipment in the Power Products Segment, including the inclusion of $63 million of sales of end product associated with our acquisition of certain assets of Murray, Inc. (“Murray”), which was completed in February of 2005.current year.

~~Second~~Third quarter net sales for the ~~Engines~~Engine Segment were ~~$381 million versus $375~~$598 million in fiscal ~~2005,~~2006 and $605 million in fiscal 2005. The 1% or $7 million decline is primarily the result of a 6% engine unit shipment decline between years, reflecting a shift of engine unit demand from the third quarter to the second quarter in fiscal 2006. Partially offsetting the unit decline between years was the net impact of improved pricing of $4 million and a mix of engines that favored higher priced units.

Third quarter Power Products Segment net sales were $288 million in fiscal 2006 versus $324 million from the same period a year ago. The $36 million decrease is primarily attributable to a $44 million reduction in Murray related lawn and garden equipment, caused by Murray related product not having as much market placement as it did a year ago. Pressure washer sales were also down $21 million on a slow start to the spring retail season. These declines were partially offset by improved generator and premium lawn and garden sales. Generator sales increased $12 million as retailers began stocking for the upcoming hurricane season.

Consolidated net sales for the nine-months ended April 2, 2006 totaled $1,886 million, an increase of $6$103 million or ~~2%.~~6% from the same period in fiscal 2005. The increase ~~resulted from an increase~~is primarily attributable to the inclusion of Murray related sales in the first half of fiscal 2006 since Murray assets were acquired in February of fiscal 2005.

Nine-month net sales for the Engine Segment totaled $1,264 million in fiscal 2006 versus $1,234 million in the prior year, a $30 million or 2% improvement. The main drivers for the improvement were a 1% engine unit ~~shipments between quarters resulting in a $13 million~~shipment increase ~~in net sales. The increased volume is attributable to strong demand for generator engines. This improvement was offset by the impact of an unfavorable Euro exchange rate~~ and a mix of shipments that favored ~~lower~~higher priced ~~engines.~~

~~Second quarter Power Products Segment net sales were $257 million versus $169 million~~product. The current year’s pricing initiatives went into effect late in fiscal 2005. The $88 million increase was driven primarily by the inclusion of $63 million of sales of Murray end product in the current quarter. The remainder of the improvement was driven by increased generator and pressure washer unit volume between years. The generator volume increase reflects continued replenishment of retail inventories that were depleted by the hurricane season. Pressure washer unit shipments increased between years due to improved retail sell through. Sales of premium lawn and garden equipment were flat between years.

Consolidated net sales for the first six months of fiscal 2006 totaled $1.086 billion, an increase of $143 million or 15%, compared to the first six months of the prior year. The entire increase is attributable to the inclusion of sales from the Murray acquisition in the current year.

Six month net sales for the Engines Segment were $666 million in fiscal 2006 versus $629 million in the prior year, a $37 million or 6% improvement. Engine unit shipments increased 9% between years on the strength of generator demand, resulting in increased sales of $59 million. Consistent with the second quarter ~~discussion, partially offsetting the volume gains were the impact~~and, as a result, have less of an ~~unfavorable Euro exchange rate and a negative mix of engines.~~impact on the nine-month sales.

Power Products Segment net sales for the ~~first six months~~nine-months ended April 2, 2006 were ~~$557~~$845 million ~~versus $391~~compared to $715 million in the prior year, an increase of ~~$166~~$130 million or ~~42%~~18%. As previously discussed, the increase reflects the increase in Murray related sales in fiscal 2006 totaling $99 million. The ~~inclusion of $143 million of~~remaining improvement reflects a 25% increase in generator sales attributable to strong demand earlier in the year from the ~~Murray acquisition was the major driver~~2005 hurricane season and increased retailer stocking in anticipation of the ~~increase.~~2006 hurricane season. The ~~remaining~~ increase ~~was driven by increased~~in generator ~~shipments offset by lower~~sales more than offsets the 18% decline in pressure washer ~~and premium lawn and garden equipment sales as retailers and dealers lowered inventory levels.~~sales.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

GROSS PROFIT MARGIN

The consolidated gross profit margin in the ~~second~~third quarter ~~decreased from 21% to 20%. Engines Segment margins~~ increased from ~~24%~~20% in fiscal 2005 to 23% in fiscal 2006. The Engine Segment gross profit margin increased from 22% to 25%. ~~Cost~~The margin improvement is primarily attributable to $12 million from ongoing cost reduction efforts and lower manufacturing spending between years ~~were partially offset by~~as well as $4 million in favorable pricing between years and the ~~$3 million~~ impact of ~~an unfavorable Euro exchange rate and~~ a favorable mix ~~that favored lower~~of larger higher margined ~~engines.~~engines in the quarter. The Power Products Segment margin was ~~10% for~~13% in the ~~second~~third quarter of fiscal 2006, ~~down~~up from 11% in fiscal 2005. ~~Losses~~Sales of higher margined premium lawn and garden equipment were stronger in the current year, resulting in a larger contribution to the Segment’s margin. In addition, margins on generators improved on increased generator production between years, which more than offset the ~~sale of Murray product reduced the Segment margin by 1% due to expenses associated with winding down operations at the Murray facilities.~~lower pressure washer production.

The consolidated gross profit margin for the ~~six-month~~nine-month period ~~decreased~~increased from 19% in fiscal 2005 to ~~18%~~20% in fiscal 2006. ~~Engines~~Engine Segment margins for the ~~six-month~~nine-month period increased from ~~21%~~22% in fiscal 2005 to ~~23%~~24% in fiscal 2006. The increase is attributable ~~primarily~~ to the benefit of cost reduction programs as well as a $6 million gain on the sale of an operating asset in the first quarter of fiscal 2006. Power Products Segment margins for the ~~six-month~~nine-month period decreased from 11% ~~in fiscal 2005~~ to ~~8% in fiscal 2006. Losses~~10%. The decline is the result of the losses on the sale of Murray product ~~reduced overall segment margins by 2%. Lower margins on the sale of premium lawn and garden equipment~~that reduced the overall Segment margin ~~by 1%, as the impact of higher interest rates on dealer financing and lower production levels, more than offset the elimination of purchase accounting in the current year.~~from 11% to 10%.

ENGINEERING, SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Engineering, selling, general and administrative expenses were ~~$79~~$83 million in the ~~second~~third quarter of fiscal 2006 versus ~~$93~~$68 million in fiscal ~~2005. Excluding~~2005, an increase of $15 million or 22%. The main drivers for the increase were: $3 million from increased legal fees associated with litigation, $4 million charge resulting from a worldwide reduction in salaried headcount in the quarter, $2 million from the expensing of stock options in fiscal 2006, and $2 million in increased information technology consulting costs. The remainder of the increase is attributable to planned increases in salaries, fringe benefits, and advertising.

For the nine-month period ended April 2, 2006, the category increased $42 million compared to the prior year period, not considering the impact of ~~$30~~$39 million in bad debt expense associated with Murray in the prior year, the category increased $16 million between years. The increase is driven primarily by increased salaries and fringe benefits of $6 million, legal fees of $4 million, and information technology consulting fees of $2 million. Salaries and fringe benefits reflect increased pension costs and the recognition of expense for the first time in the current year for stock options.

~~The category increased $27 million, excluding the impact of $39 million in bad debts associated with Murray in the prior year, for the six-month comparative periods.~~year. The increase is primarily attributable to the same factors identified for the ~~second~~third quarter including salaries and fringe ~~benefits~~benefit increases of $12 million, legal fees of $5$8 million, and information technology consulting of ~~$3 million.~~$5 million, stock option expense of $6 million, and $4 million of expense reflecting the impact of headcount reductions in the third quarter.

INTEREST EXPENSE

Interest expense ~~increased $3~~was $11 million in the ~~second~~third quarter of fiscal 2006 versus ~~the second quarter of~~$10 million in fiscal 2005. The increase ~~reflects~~is attributable to higher borrowings between years associated with the ~~$125 million~~ Term Notes used ~~to finance~~for the Murray asset acquisition ~~of certain assets of Murray, Inc.~~ in ~~the third quarter of fiscal~~February 2005. Interest expense increased $4$5 million for the ~~six-month~~nine-month comparative periods for the same ~~reason.~~reason explained for the third quarter.

PROVISION FOR INCOME TAXES

The effective tax rate ~~used in both the second quarter and six-month period~~ for the ~~current~~third quarter of fiscal ~~year~~2006 was ~~35%. This rate is management’s estimate~~32% versus 34% in fiscal 2005. The decrease reflects the completion of ~~what~~ the rate will be for the entire 2006 fiscal year based on today’s facts. Last year’s rate was 34% for the second quarter and the six-month period. The fiscal 2005 rate was ultimately decreased to 33% for the entire fiscal year. The increase in the effective tax rate in the current year is attributable to increased earnings expectations, lower dividend income expected in the current year and any related foreign tax credit implications. The audit for tax years 2000-2002 ~~has progressed~~that resulted in the favorable resolution of certain tax contingencies in the third quarter of fiscal 2006. The effective tax rate was 33% for the nine month period in fiscal 2006 versus 34% in fiscal 2005. The decrease is due to the ~~final level of review by~~same item identified for the ~~IRS and the Company anticipates that it will be favorably settled during the current fiscal year upon approval by the Joint Committee of Taxation.~~third quarter.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

EXTRAORDINARY GAIN

The extraordinary gain in the third quarter of fiscal 2005 represents the difference between the estimated fair value of the assets acquired from Murray and the cash paid, after all tax considerations. There was no such extraordinary gain in fiscal 2006.

LIQUIDITY AND CAPITAL RESOURCES

Cash used in operating activities for the ~~six-month~~nine-month period of fiscal 2006 was ~~$228~~$21 million, ~~a decrease~~an improvement of ~~$6 million. Lower~~$9 million from fiscal 2005. Higher earnings excluding the impact of the non-cash extraordinary gain in the prior year more than offset the $10 million increase in working capital requirements ~~is the primary driver for the decrease in cash used from operations. A reduction in receivables~~between years. The increased working capital requirements attributable to higher inventory levels associated primarily with increased generators and premium lawn and garden equipment were partially offset by lower receivable levels between years due to ~~the elimination~~lower sales of ~~sales to~~ Murray related product in the current ~~year and lower bonus and other accrual payouts offset the impact of increased inventory attributable primarily to the Engines Segment.~~year.

In the ~~six-month~~nine-month period of fiscal 2006, we$36 million was used ~~$18 million~~ for investing activities compared to ~~$258~~$408 million in fiscal 2005. The ~~$240~~$372 million decrease ~~in use of cash for investing activities~~ is attributable to the ~~$223~~$350 million ~~acquisition~~in cash used for acquisitions of Simplicity Manufacturing, Inc. and certain Murray assets in ~~fiscal 2005, and~~the prior year, as well as lower ~~net~~fixed asset additions in the current year.

Net cash ~~provided by~~used in financing activities was ~~$124~~$43 million in fiscal 2006, versus ~~$170~~the $133 million in cash provided by financing activities in fiscal 2005, a ~~decrease~~net change of ~~$46~~$176 million. The ~~decrease~~change from financing activities providing cash to using cash is attributable primarily to ~~lower seasonal working capital borrowings~~the $125 million in Term Notes issued to finance the acquisition of the Murray assets in February 2005. In addition, in the current year, ~~and lower stock option activity.~~Briggs & Stratton repurchased approximately $27 million of its common shares.

FUTURE LIQUIDITY AND CAPITAL RESOURCES

Briggs & Stratton has a $350 million revolving credit facility that expires in May 2009. There were no borrowings on this line of credit as of the end of the third quarter fiscal 2006. The credit facility is used to fund seasonal working capital requirements and other financing needs.

Management has authorization to buy up to 1.8 million shares of Briggs & Stratton common stock in open market or private transactions under a June 2000 Board of Directors’ authorization. The Company did not purchase any shares in the first half of fiscal 2006. On February 2, 2006, ~~the Company~~Briggs & Stratton announced its intent to initiate repurchases of up to one million shares of its common stock through open market transactions to be completed by June 2006. ~~The timing~~As of the end of the third quarter, Briggs & Stratton had repurchased 753,500 shares on the open market at an average price $35 per share. There were no purchases made in fiscal 2006 prior to the February announcement and ~~amount of purchases will be dependent upon~~there were no shares repurchased in fiscal 2005. Subsequent to the ~~market~~quarter end, Briggs & Stratton purchased an additional 246,500 shares at an average price of $34 per share. Management does not anticipate any additional share repurchases in fiscal 2006.

Subsequent to the ~~stock and certain governing loan covenants.~~third quarter ended April 2, 2006, Briggs & Stratton repurchased approximately $ 9 million of 7.25% senior notes due September 15, 2007. Briggs & Stratton does not anticipate making additional repurchases in fiscal 2006.

Management expects cash outflows for capital expenditures to be approximately ~~$80~~$70 million in fiscal 2006. ~~These~~The anticipated expenditures provide for continued investment in equipment and new products. These expenditures will be funded using available cash.

Management believes that available cash, the credit facility, cash generated from operations, existing lines of credit and access to debt markets will be adequate to fund our capital requirements for the foreseeable future.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

OFF-BALANCE SHEET ARRANGEMENTS

There have been no material changes since the September 16, 2005, filing of ~~the Company’s~~Briggs & Stratton’s Annual Report on
Form 10-K.

OTHER MATTERS

During the first quarter of fiscal 2006, Briggs & Stratton extended the term of its collective bargaining agreement governing certain Milwaukee area employees through July 31, 2010. Other agreements expire at various times ranging from 2006 through 2008.

The Company intends to reduce salaried headcount by a range of 6% to 8% by February 15, 2006. The goal is to streamline operations to reflect organizational and workflow changes that have occurred over the last several years. The Company believes the reduction will result in approximately $10 to $15 million of annual, pretax savings beginning in fiscal 2007.

CONTRACTUAL OBLIGATIONS

There have been no material changes since the September 16, 2005, filing of ~~the Company’s~~Briggs & Stratton’s Annual Report on
Form 10-K.

~~BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES~~

CRITICAL ACCOUNTING POLICIES

There have been no material changes in Briggs & Stratton’s critical accounting policies since the September 16, 2005 filing of its Annual Report on Form 10-K. As discussed in our annual report, the preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions about future events that affect the amounts reported in the financial statements and accompanying notes. Future events and their effects cannot be determined with absolute certainty. Therefore, the determination of estimates requires the exercise of judgment. Actual results inevitably will differ from those estimates, and such differences may be material to the financial statements.

The most significant accounting estimates inherent in the preparation of our financial statements include estimates as to the recovery of accounts receivable and inventory reserves, as well as those used in the determination of liabilities related to customer rebates, pension obligations, post-retirement benefits, warranty, product liability, group health insurance and taxation. Various assumptions and other factors underlie the determination of these significant estimates. The process of determining significant estimates is fact specific and takes into account factors such as historical experience, current and expected economic conditions, product mix, and, in some instances, actuarial techniques. Briggs & Stratton re-evaluates these significant factors as facts and circumstances change.

CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

This report contains certain forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements. The words “anticipate”, “believe”, “estimate”, “expect”, “forecast”, “intend”, “may”, “objective”, “plan”, “project”, “seek”, “think”, “will”, and similar expressions are intended to identify forward-looking statements. The forward-looking statements are based on ~~the Company’s~~Briggs & Stratton’s current views and assumptions and involve risks and uncertainties that include, among other things, the ability to successfully forecast demand for our products and appropriately adjust our manufacturing and inventory levels; changes in our operating expenses; changes in interest rates; the effects of weather on the purchasing patterns of consumers and original equipment manufacturers (OEMs); actions of engine manufacturers and OEMs with whom we compete; the seasonal nature of our business; changes in laws and regulations, including environmental, tax, pension funding and accounting standards; work stoppages or other consequences of any deterioration in our employee relations; work stoppages by other unions that affect the ability of suppliers or customers to manufacture; acts of war or terrorism that may disrupt our business operations or those of our customers and suppliers; changes in customer and OEM demand; changes in prices of raw materials and parts that we purchase; changes in domestic

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

economic conditions, including housing starts and changes in consumer disposable income; changes in foreign economic conditions, including currency rate fluctuations; our ~~customers’~~customer’s ability to successfully obtain financing; the actions of customers of our OEM customers; actions by potential acquirers of certain OEMs; the ability to successfully realize the maximum market value of acquired assets; new facts that come to light in the future course of litigation proceedings which could affect our assessment of those matters; and other factors that may be disclosed from time to time in our SEC filings or otherwise. Some or all of the factors may be beyond our control. We caution you that any forward-looking statement reflects only our belief at the time the statement is made. We undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made.

~~BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES~~

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes since the September 16, 2005, filing of ~~the Company’s~~Briggs & Stratton’s Annual Report on
Form 10-K.

ITEM 4. CONTROLS AND PROCEDURES

DISCLOSURE CONTROLS AND PROCEDURES

~~The Company’s~~Briggs & Stratton’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of ~~the Company’s~~Briggs & Stratton’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, ~~the Company’s~~Briggs & Stratton’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures are effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by ~~the Company~~Briggs & Stratton in the reports that it files or submits under the Exchange Act.

INTERNAL CONTROL OVER FINANCIAL REPORTING

There has not been any change in ~~the Company’s~~Briggs & Stratton’s internal control over financial reporting during the ~~second~~third fiscal quarter that has materially affected, or is reasonably likely to materially affect, ~~the Company’s~~Briggs & Stratton’s internal control over financial reporting.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

A discussion of legal proceedings is included in the Notes to Consolidated Condensed Financial Statements of this Form ~~10Q~~10-Q under the heading Commitments and Contingencies and incorporated herein by reference.

ITEM 4. SUBMISSION2. UNREGISTERED SALES OF MATTERS TO A VOTEEQUITY SECURITIES AND USE OF SECURITY HOLDERSPROCEEDS

					Maximum
				Total Number of	Number of Shares
	Total Number			Shares Purchased	that May Yet Be
	of Shares	Average Price		as Part of Publicly	Purchased Under
2006 Fiscal Month	Purchased (1)	Paid per Share (2)		Announced Plan (3)	the Plan (4)

January 2, 2006 to January 29, 2006	-	$	-	-	1,837,100
January 30, 2006 to February 26, 2006	703,500	35.31		703,500	1,133,600
February 27, 2006 to April 2, 2006	50,000	34.32		50,000	1,083,600
Total Third Quarter	753,500	$	35.25	753,500

(1) All share repurchases were effected in accordance with the safe harbor provisions of Rule 10b-18 of the Securities Exchange Act.

~~The Company held~~(2) Briggs & Stratton repurchased shares in open market transactions.

(3) On February 2, 2006, Briggs & Stratton publicly announced its ~~Annual Meeting~~plan to repurchase up to 1,000,000 shares of ~~Shareholders on October 19, 2005. Information on~~common stock through open market purchases by June 2006.

(4) In June 2000, the ~~matters voted upon and~~Board of Directors authorized the ~~votes cast with respect to each matter was previously reported~~repurchase of 2,000,000 shares of Briggs & Stratton common stock in ~~the Company’s Quarterly Report on Form 10-Q for the quarter ended October 2, 2005.~~open market or private transactions.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

ITEM 6. EXHIBITS

Exhibit
Number		Description

10.6(a)		Amended and Restated Form of Stock Option Agreement Under the Premium Option and Stock Award Program
		(Filed herewith)

10.12(a)		Amended and Restated Form of Director’s Stock Option Agreement Under the Director’s Premium Option and Stock Grant Program
		(Filed herewith)

31.1		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
		(Filed herewith)

31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
		(Filed herewith)

32.1		Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
		(Furnished herewith)

32.2		Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
		(Furnished herewith)

2627

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

SIGNATURES~~SIGNATURES~~

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		BRIGGS & STRATTON CORPORATION
		(Registrant)


Date: ~~February 7,~~May 5, 2006	~~/s/~~ /s/ James E. Brenn
		James E. Brenn
		Senior Vice President and Chief Financial Officer and
		Duly Authorized Officer

2728

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

EXHIBIT INDEX

Exhibit
Number		Description

10.6(a)		Amended and Restated Form of Stock Option Agreement Under the Premium Option and Stock Award Program
		(Filed herewith)

10.12(a)		Amended and Restated Form of Director’s Stock Option Agreement Under the Director’s Premium Option and Stock Grant Program
		(Filed herewith)

31.1		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
		(Filed herewith)

31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
		(Filed herewith)

32.1		Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
		(Furnished herewith)

32.2		Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
		(Furnished herewith)

2829