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 ~~December 26, 2004~~March 27, 2005

¨	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

(Exact name of registrant as specified in its charter)

Wisconsin

39-0182330

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

12301 West Wirth Street, Wauwatosa, Wisconsin 53222

(Address of Principal Executive Offices) (Zip Code)

414/259-5333

(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.

Yesx No¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yesx No¨

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class

Outstanding at

~~January 28,~~ April 29, 2005

COMMON STOCK, par value $0.01 per share

~~51,533,469~~51,593,331 Shares

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

INDEX


			Page No.
PART I – FINANCIAL INFORMATION

	Item 1.	Financial Statements

~~Item 1.~~	~~Financial Statements~~

	Consolidated Condensed Balance Sheets – ~~December 26, 2004~~ March 27, 2005 and June 27, 2004	3

		Consolidated Condensed Statements of Income – Three Months and ~~Six~~Nine Months Ended ~~December 26,~~March 27, 2005 and March 28, 2004 ~~and December 28, 2003~~	5

		Consolidated Condensed Statements of Cash Flows – ~~Six~~ Nine Months Ended ~~December 26,~~March 27, 2005 and March 28, 2004 ~~and~~ ~~December 28, 2003~~	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	2425

	Item 4.	Controls and Procedures	25

PART II – OTHER INFORMATION

	Item 4. 1.	~~Submission of Matters to a Vote of Security Holders~~Legal Proceedings	26

	Item 6.	Exhibits	26

	Signatures		27

~~Exhibit Index~~		28

	Exhibit Index		29

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

PART I - FINANCIAL INFORMATION

~~ITEM 1.~~

~~FINANCIAL STATEMENTS~~

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED CONDENSED BALANCE SHEETS

(In thousands)

ASSETS


	December 26, 2004		June 27, 2004		March 27, 2005		June 27, 2004
	(Unaudited)				(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents	$	24,078	$	342,394	$	40,755	$	342,394
Accounts receivable, net		330,954		230,510		471,192		230,510
Inventories -
Finished products and parts		377,746		206,638		327,315		206,638
Work in process		176,793		124,483		191,288		124,483
Raw materials		9,267		6,610		12,304		6,610

Total inventories		563,806		337,731		530,907		337,731
Deferred income tax asset		74,418		47,623		61,485		47,623
Prepaid expenses and other current assets		25,139		23,735		20,371		23,735

Total current assets		1,018,395		981,993		1,124,710		981,993

OTHER ASSETS:
Goodwill		248,799		151,991		251,395		151,991
Other intangible assets, net						96,908		217
Prepaid pension						83,789		81,730
Investments		45,190		49,259		45,661		49,259
Prepaid pension		83,102		81,730
Deferred loan costs, net		5,744		6,325		6,383		6,325
Other intangible assets, net		97,370		217
Other long-term assets, net		10,503		9,096		11,887		9,096

Total other assets		490,708		298,618		496,023		298,618

PLANT AND EQUIPMENT:
Cost		959,913		867,987		974,047		867,987
Less - accumulated depreciation		535,119		511,445		544,048		511,445

Total plant and equipment, net		424,794		356,542		429,999		356,542

	$	1,933,897	$	1,637,153	$	2,050,732	$	1,637,153

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


	December 26, 2004			June 27, 2004			March 27, 2005			June 27, 2004
	(Unaudited)						(Unaudited)
CURRENT LIABILITIES:
Accounts payable	$	139,382		$	120,409		$	173,724		$	120,409
Accrued liabilities		198,133			177,025			233,123			177,025
Dividends payable		8,775			—			8,770			—
Short-term debt		164,077			3,127			10,622			3,127

Total current liabilities		510,367			300,561			426,239			300,561

OTHER LIABILITIES:
Long-term debt		360,941			360,562			486,131			360,562
Deferred income tax liability		106,190			70,454			107,221			70,454
Accrued pension cost		21,768			20,603			22,120			20,603
Accrued employee benefits		14,487			14,201			14,885			14,201
Accrued postretirement health care obligation		78,530			38,248			77,144			38,248
Other long-term liabilities		15,148			14,929			15,780			14,929

Total other liabilities		597,064			518,997			723,281			518,997

SHAREHOLDERS’ INVESTMENT:
Common stock -
Authorized 120,000* and 60,000 shares, $.01 par value, issued 57,854* and 28,927 shares, respectively		579			289			579			289
Additional paid-in capital		54,577			48,657			54,987			48,657
Retained earnings		915,884			927,766			987,736			927,766
Accumulated other comprehensive income		6,289			4,028			7,293			4,028
Unearned compensation on restricted stock		(1,753	)		(1,490	)		(1,863	)		(1,490	)
Treasury stock, at cost 6,236* shares in FY2005 and 3,382 in FY2004		(149,110	)		(161,655	)
Treasury stock, at cost 6,170* shares in FY2005 and 3,382 in FY2004								(147,520	)		(161,655	)

Total shareholders’ investment		826,466			817,595			901,212			817,595

	$	1,933,897		$	1,637,153		$	2,050,732		$	1,637,153

*	Share data reflects the 2-for-1 stock split effective October 29, 2004.

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						Nine Months Ended
	March 27, 2005			March 28, 2004			March 27, 2005			March 28, 2004
NET SALES	$	840,463		$	654,681		$	1,783,158		$	1,402,060
COST OF GOODS SOLD		674,735			486,914			1,440,470			1,083,252

Gross profit on sales		165,728			167,767			342,688			318,808
ENGINEERING, SELLING, GENERAL AND ADMINISTRATIVE EXPENSES		68,244			53,263			228,862			151,333

Income from operations		97,484			114,504			113,826			167,475
INTEREST EXPENSE		(10,240	)		(9,603	)		(27,154	)		(29,031	)
OTHER INCOME, net		4,930			2,467			13,944			5,175

Income before income taxes		92,174			107,368			100,616			143,619
PROVISION FOR INCOME TAXES		31,350			36,100			34,220			47,700

Income before extraordinary item		60,824			71,268			66,396			95,919
EXTRAORDINARY GAIN - NEGATIVE GOODWILL		19,800			—			19,800			—

NET INCOME	$	80,624		$	71,268		$	86,196		$	95,919

EARNINGS PER SHARE DATA*-
Average shares outstanding		51,194			44,307			51,428			44,430

Income before extraordinary item		1.19			1.61			1.29			2.16
Extraordinary gain		0.38			—			0.38			—

Basic earnings per share	$	1.57		$	1.61		$	1.67		$	2.16

Diluted average shares outstanding		51,710			50,331			51,964			50,428

Income before extraordinary item		1.18			1.44			1.28			1.97
Extraordinary gain		0.38			—			0.38			—

Diluted earnings per share	$	1.56		$	1.44		$	1.66		$	1.97

CASH DIVIDENDS DECLARED PER SHARE*	$	0.170		$	0.165		$	0.510		$	0.495

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

The accompanying notes are an integral part of these statements.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF ~~INCOME~~CASH FLOWS

(In ~~thousands, except per share data)~~thousands)

(Unaudited)

   Three Months Ended
Six Months Ended

   December 26,
2004
December 28,
2003
December 26,
2004
December 28,
2003

NET SALES
   $ 503,700 $ 415,984 $ 942,695 $ 747,379
COST OF GOODS SOLD
   397,558 325,138 765,735 596,338


Gross profit on sales
   106,142 90,846 176,960 151,041
ENGINEERING, SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
   92,658 52,170 160,618 98,070


Income from operations
   13,484 38,676 16,342 52,971
INTEREST EXPENSE
   (8,795 ) (9,596 ) (16,914 ) (19,428 )
OTHER INCOME, net
   6,081 1,265 9,014 2,708


Income before income taxes
   10,770 30,345 8,442 36,251
PROVISION FOR INCOME TAXES
   3,710 9,710 2,870 11,600


NET INCOME
   $ 7,060 $ 20,635 $ 5,572 $ 24,651


EARNINGS PER SHARE DATA* -

Average shares outstanding
   51,193 44,176 51,361 44,243


Basic earnings per share
   $ 0.14 $ 0.47 $ 0.11 $ 0.56


Diluted average shares outstanding
   51,751 50,208 51,905 50,216


Diluted earnings per share
   $ 0.14 $ 0.43 $ 0.11 $ 0.54


CASH DIVIDENDS DECLARED PER SHARE*
   $ 0.170 $ 0.165 $ 0.340 $ 0.330

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


	Nine Months Ended
	March 27, 2005			March 28, 2004
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	86,196		$	95,919
Adjustments to reconcile net income to net cash used in operating activities -
Extraordinary gain		(19,800	)		—
Depreciation and amortization		54,182			48,167
Earnings of unconsolidated affiliates		(12,914	)		(2,807	)
Loss on disposition of plant and equipment		1,922			4,507
(Credit) provision for deferred income taxes		(15,428	)		1,119
Provision for bad debt		38,916			—
Changes in operating assets and liabilities, net of acquired assets and liabilities;
Increase in accounts receivable		(176,766	)		(217,725	)
Increase in inventories		(49,996	)		(121,955	)
Decrease in prepaid expenses and other current assets		5,960			3,460
Increase in accounts payable and accrued liabilities		37,615			68,830
Other, net		1,908			(10,168	)

Net cash used in operating activities		(48,205	)		(130,653	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to plant and equipment		(61,027	)		(35,456	)
Proceeds received on disposition of plant and equipment		758			617
Proceeds received on sale of certain assets of a subsidiary		4,050			—
Cash paid for acquisitions, net of cash acquired		(350,044	)		—
Investment in joint venture		(1,500	)		—
Dividends received		18,351			3,500
Refund of cash paid for acquisition		—			5,686

Net cash used in investing activities		(389,412	)		(25,653	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings (repayments) on loans and notes payable		131,570			(331	)
Dividends paid		(17,502	)		(14,667	)
Proceeds from exercise of stock options		19,037			29,415

Net cash provided by financing activities		133,105			14,417

EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS		2,873			1,874

NET DECREASE IN CASH AND CASH EQUIVALENTS		(301,639	)		(140,015	)
CASH AND CASH EQUIVALENTS, beginning		342,394			324,815

CASH AND CASH EQUIVALENTS, ending	$	40,755		$	184,800

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid	$	34,652		$	33,771

Income taxes paid	$	11,498		$	11,867

The accompanying notes are an integral part of these statements.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

~~CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS~~

~~(Unaudited, in thousands)~~

   Six Months Ended

   December 26,
2004
December 28,
2003

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income
   $ 5,572 $ 24,651
Adjustments to reconcile net income to net cash used in operating activities -

Depreciation and amortization
   35,837 32,290
Earnings of unconsolidated affiliates
   (8,500 ) (1,011 )
Loss on disposition of plant and equipment
   1,279 3,066
Credit for deferred income taxes
   (29,392 ) (1,514 )
Change in bad debt allowance
   40,123 2,006
Change in operating assets and liabilities -

Increase in accounts receivable
   (116,144 ) (139,868 )
Increase in inventories
   (165,404 ) (127,604 )
(Increase) decrease in prepaid expenses and other current assets
   994 (5,150 )
Increase (decrease) in accounts payable and accrued liabilities
   (11,920 ) 7,927
Other, net
   1,569 (5,707 )


Net cash used in operating activities
   (245,986 ) (210,914 )


CASH FLOWS FROM INVESTING ACTIVITIES:

Additions to plant and equipment
   (39,382 ) (23,144 )
Proceeds received on disposition of plant and equipment
   332 299
Proceeds received on sale of certain assets of a subsidiary
   4,050 —
Cash paid for acquisition, net of cash acquired
   (223,113 ) —
Dividends received
   12,017 3,500
Refund of cash paid for acquisition
   —   5,686


Net cash used in investing activities
   (246,096 ) (13,659 )


CASH FLOWS FROM FINANCING ACTIVITIES:

Net borrowings (repayments) on loans and notes payable
   160,950 (1,671 )
Dividends paid
   (8,694 ) (7,285 )
Proceeds from exercise of stock options
   17,648 24,701


Net cash provided by financing activities
   169,904 15,745


EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
   3,862 3,336


NET DECREASE IN CASH AND CASH EQUIVALENTS
   (318,316 ) (205,492 )
CASH AND CASH EQUIVALENTS, beginning
   342,394 324,815


CASH AND CASH EQUIVALENTS, ending
   $ 24,078 $ 119,323


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Interest paid
   $ 16,078 $ 18,840


Income taxes paid
   $ 9,710 $ 1,540

~~The accompanying notes are an integral part of these statements.~~

~~BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES~~

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(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 United States. However, in the opinion of Briggs & Stratton, 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~~there-to 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~~two-for-one stock split of its common stock, which became effective on October 29, 2004 following shareholder approval of the amendment to the Briggs & Stratton Corporation Articles of Incorporation. The stock split was distributed on November 9, 2004 to shareholders of record on October 29, 2004. Certain references in the Consolidated Condensed Financial Statements to the number of common shares and related per share amounts have been restated to reflect the stock split.

~~Accounts Receivable~~

Accounts Receivable include $40 million from Murray Inc., a major original equipment manufacturer. Murray, Inc. filed a voluntary petition for reorganization under Chapter 11 of the U. S. Bankruptcy Code on November 8, 2004. Accordingly, during the first and second quarter of fiscal 2005 we have recorded a reserve of $10 million and $30 million, respectively. At December 26, 2004 the receivable is fully reserved.

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 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.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

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

   Three Months Ended
   Six Months Ended
   December 26,
2004
   December 28,
2003
   December 26,
2004
   December 28,
2003
Net income
   $ 7,060    $ 20,635    $ 5,572    $ 24,651
Adjustments to net income to add after tax interest expense on convertible notes
   —      1,190    —      2,380




Adjusted net income used in diluted earnings per share
   $ 7,060    $ 21,825    $ 5,572    $ 27,031
��



Average shares of common stock outstanding*
   51,193    44,176    51,361    44,243
Incremental common shares applicable to common stock options based on the common stock average market price during the period*
   526    361    510    295
Incremental common shares applicable to restricted common stock based on the common stock average market price during the period*
   32    19    34    26
Incremental common shares applicable to convertible notes based on the conversion provisions of the convertible notes*
   —      5,652    —      5,652




Diluted average common shares outstanding*
   51,751    50,208    51,905    50,216


	Three Months Ended				Nine Months Ended
	March 27, 2005		March 28, 2004		March 27, 2005		March 28, 2004
Net income	$	80,624	$	71,268	$	86,196	$	95,919
Adjustments to net income to add after tax interest expense on convertible notes		—		1,162		—		3,507

Adjusted net income used in diluted earnings per share	$	80,624	$	72,430	$	86,196	$	99,426

Average shares of common stock outstanding*		51,194		44,307		51,428		44,430
Incremental common shares applicable to common stock options based on the common stock average market price during the period*		485		351		502		317
Incremental common shares applicable to restricted common stock based on the common stock average market price during the period*		31		21		34		29
Incremental common shares applicable to convertible notes based on the conversion provisions of the convertible notes*		—		5,652		—		5,652

Diluted average common shares outstanding*		51,710		50,331		51,964		50,428

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

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

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 is as follows (in thousands):


	Three Months Ended						Six Months Ended						Three Months Ended						Nine Months Ended
	December 26, 2004			December 28, 2003			December 26, 2004			December 28, 2003			March 27, 2005			March 28, 2004			March 27, 2005			March 28, 2004
Net income	$	7,060		$	20,635		$	5,572		$	24,651		$	80,624		$	71,268		$	86,196		$	95,919
Cumulative translation adjustments		3,105			2,744			3,519			3,416			(46	)		(1,402	)		3,473			2,014
Unrealized loss on derivative instruments		(853	)		(7,132	)		(1,258	)		(8,106	)
Unrealized gain (loss) on derivative instruments														1,050			8,016			(208	)		(90	)

Total comprehensive income	$	9,312		$	16,247		$	7,833		$	19,961		$	81,628		$	77,882		$	89,461		$	97,843

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


	December 26, 2004			June 27, 2004			March 27, 2005			June 27, 2004
Cumulative translation adjustments	$	8,377		$	4,858		$	8,331		$	4,858
Unrealized (loss) gain on derivative instruments		(758	)		500
Unrealized gain on derivative instruments								292			500
Minimum pension liability adjustment		(1,330	)		(1,330	)		(1,330	)		(1,330	)

Accumulated other comprehensive income	$	6,289		$	4,028		$	7,293		$	4,028

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. Briggs & Stratton has used interest rate swaps designated as fair value hedges to manage its debt portfolio. These instruments generally have maturities and terms consistent with the underlying debt instrument. In April 2004, all interest rate swaps were terminated.

Changes in the fair value of cash flow hedges are recorded on the Consolidated Condensed Statements of Income or on the Consolidated Condensed Balance Sheets 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 fair value hedges related to interest rate swaps were recorded as either an increase or decrease to long-term debt. 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 CORPORATION AND SUBSIDIARIES

Segment and Geographic Information

Briggs & Stratton operates in 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
	December 26, 2004			December 28, 2003			December 26, 2004			December 28, 2003			March 27, 2005			March 28, 2004			March 27, 2005			March 28, 2004
NET SALES:
Engines	$	374,874		$	357,848		$	628,986		$	592,196		$	604,866		$	581,915		$	1,233,852		$	1,174,111
Power Products		170,568			97,614			392,867			223,163			323,650			125,637			714,912			348,800
Inter-Segment Eliminations		(41,742	)		(39,478	)		(79,158	)		(67,980	)		(88,053	)		(52,871	)		(165,606	)		(120,851	)

Total*	$	503,700		$	415,984		$	942,695		$	747,379		$	840,463		$	654,681		$	1,783,158		$	1,402,060

*International Sales (included in the above)
* International Sales (included in the above)
Engines	$	84,998		$	108,383		$	163,495		$	160,660		$	144,846		$	121,813		$	301,650		$	274,767
Power Products		3,058			3,982			6,419			7,510			28,472			705			43,591			8,215

Total	$	88,056		$	112,365		$	169,914		$	168,170		$	173,318		$	122,518		$	345,241		$	282,982

GROSS PROFIT ON SALES:
Engines	$	88,681		$	80,867		$	132,926		$	123,373		$	133,710		$	156,450		$	266,636		$	279,823
Power Products		17,849			11,891			42,047			27,961			34,741			14,146			76,788			42,107
Inter-Segment Eliminations		(388	)		(1,912	)		1,987			(293	)		(2,723	)		(2,829	)		(736	)		(3,122	)

Total	$	106,142		$	90,846		$	176,960		$	151,041		$	165,728		$	167,767		$	342,688		$	318,808

INCOME (LOSS) FROM OPERATIONS:
INCOME FROM OPERATIONS:
Engines	$	14,528		$	35,432		$	9,852		$	38,712		$	85,522		$	110,019		$	95,374		$	148,731
Power Products		(656	)		5,156			4,503			14,552			14,685			7,314			19,188			21,866
Inter-Segment Eliminations		(388	)		(1,912	)		1,987			(293	)		(2,723	)		(2,829	)		(736	)		(3,122	)

Total	$	13,484		$	38,676		$	16,342		$	52,971		$	97,484		$	114,504		$	113,826		$	167,475

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):


Balance, June 27, 2004	$	43,148		$	43,148
Balance Related to Acquistion		8,773
Balance Related to Acquistions					12,273
Payments		(18,603	)		(27,476	)
Provision for Current Year Warranties		19,125			30,197
Provision for Prior Year Warranties		(1,784	)		(238	)

Balance, End of Period	$	50,659		$	57,904

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

Stock Options

Briggs & Stratton has an Incentive Compensation Plan that is accounted for under Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees”. Under the plan, no compensation cost has been recognized. Had compensation cost for this plan been determined consistent with Statement of Financial Accounting Standard (“SFAS”) No. 123, “Accounting for Stock-Based Compensation,” and SFAS No. 148, “Accounting for Stock-Based Compensation-Transition and Disclosure”, the Company’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,
2004
December 28,
2003
December 26,
2004
December 28,
2003

Net income as reported:
   $ 7,060 $ 20,635 $ 5,572 $ 24,651
Basic EPS:

Deduct employee compensation expense
determined under a fair value based
method, net of related tax effects
   (1,471 ) (849 ) (2,461 ) (1,645 )


Income Available to Common Stockholders:
   5,589 19,786 3,111 23,006
Diluted EPS:

Add reduction in interest expense related to convertible debt
   —   1,190 —   2,380


Income Available to Common Stockholders:
   $ 5,589 $ 20,976 $ 3,111 $ 25,386


Earnings per share*:

As reported
   $ 0.14 $ 0.47 $ 0.11 $ 0.56
Pro forma
   $ 0.11 $ 0.45 $ 0.06 $ 0.52
Diluted earnings per share*:

As reported
   $ 0.14 $ 0.43 $ 0.11 $ 0.54
Pro forma
   $ 0.11 $ 0.42 $ 0.06 $ 0.51


	Three Months Ended						Nine Months Ended
	March 27, 2005			March 28, 2004			March 27, 2005			March 28, 2004
Net income as reported:	$	80,624		$	71,268		$	86,196		$	95,919
Basic EPS:
Deduct employee compensation expense determined under a fair value based method, net of related tax effects		(1,322	)		(1,145	)		(3,784	)		(2,767	)

Income Available to Common Stockholders:		79,302			70,123			82,412			93,152
Diluted EPS:
Add reduction in interest expense related to convertible debt		—			1,162			—			3,507

Income Available to Common Stockholders:	$	79,302		$	71,285		$	82,412		$	96,659

Earnings per share*:
As reported	$	1.57		$	1.61		$	1.67		$	2.16
Pro forma	$	1.55		$	1.58		$	1.60		$	2.10

Diluted earnings per share*:
As reported	$	1.56		$	1.44		$	1.66		$	1.96
Pro forma	$	1.55		$	1.42		$	1.59		$	1.92

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

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				Pension Benefits						Other Postretirement Benefits
	Three Months Ended						Three Months Ended				Three Months Ended						Three Months Ended
	December 26, 2004			December 28, 2003			December 26, 2004		December 28, 2003		March 27, 2005			March 28, 2004			March 27, 2005		March 28, 2004
Components of Net Periodic (Income) Expense:
Service cost-benefits earned	$	3,017		$	3,078		$	609	$	545	$	3,243		$	3,274		$	678	$	167
Interest cost on projected benefit obligation		13,502			12,833			4,172		2,719		13,611			12,772			4,176		2,636
Expected return on plan assets		(17,339	)		(18,180	)		—		—		(17,700	)		(18,114	)		—		—
Amortization of:
Transition obligation		—			2			12		—		—			2			12		35
Prior service cost		785			799			7		8		785			770			8		7
Actuarial loss		245			159			3,766		2,124		194			152			3,531		2,017

Net periodic (income) expense	$	210		$	(1,309	)	$	8,566	$	5,396	$	133		$	(1,144	)	$	8,405	$	4,862


	Pension Benefits						Other Postretirement Benefits				Pension Benefits						Other Postretirement Benefits
	Six Months Ended						Six Months Ended				Nine Months Ended						Nine Months Ended
	December 26, 2004			December 28, 2003			December 26, 2004		December 28, 2003		March 27, 2005			March 28, 2004			March 27, 2005		March 28, 2004
Components of Net Periodic (Income) Expense:
Service cost-benefits earned	$	6,487		$	6,595		$	1,372	$	1,088	$	9,730		$	9,869		$	2,050	$	1,255
Interest cost on projected benefit obligation		27,222			25,545			8,351		5,438		40,833			38,317			12,527		8,074
Expected return on plan assets		(35,400	)		(36,229	)		—		—		(53,100	)		(54,343	)		—		—
Amortization of:
Transition obligation		—			4			23		—		—			6			35		35
Prior service cost		1,570			1,540			15		16		2,355			2,310			23		23
Actuarial loss		388			303			7,156		4,248		582			455			10,687		6,265

Net periodic (income) expense	$	267		$	(2,242	)	$	16,917	$	10,790	$	400		$	(3,386	)	$	25,322	$	15,652

Employer Contributions:

Briggs & Stratton does not expect to make any contributions to the pension plans in fiscal 2005.

Estimated Benefit Payments for Unfunded Plans:

Briggs & Stratton expects to make benefit payments of approximately ~~$1.6~~$1.5 million for its non-qualified pension plan during fiscal 2005. As of ~~December 26, 2004,~~March 27, 2005, Briggs & Stratton had made payments of approximately ~~$0.8~~$1.1 million. Briggs & Stratton anticipates benefit payments of approximately ~~$28.4~~$27.9 million for its other postretirement benefit plans during fiscal 2005. As of ~~December 26, 2004,~~March 27, 2005, Briggs & Stratton had made payments of approximately ~~$14.2~~$20.9 million.

~~Subsequent Event~~

On January 25, 2005, Briggs & Stratton Power Products Group, LLC and Briggs & Stratton Canada, Inc., which are wholly-owned subsidiaries of Briggs & Stratton Corporation, (collectively “Briggs”) executed an Asset Purchase Agreement (the “APA”) with Murray, Inc. and Murray Canada Co. (collectively “Murray”). On January 31, 2005, the United States Bankruptcy Court for the Middle District of Tennessee approved this agreement.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

The APA provides for the purchase by Briggs of substantially all of the Murray assets in the United States and Canada, excluding real estate located in the United States, for an aggregate purchase price of $125 million. The final closing of this transaction remains subject to, among other things, expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

~~The APA contains customary representations, warranties and closing conditions, and provides that the purchase price of $125 million is subject to adjustment for the Murray working capital at closing.~~

~~Acquisition~~Acquisitions

On July 7, 2004, Briggs & Stratton and its subsidiary, Briggs & Stratton Power Products Group, LLC (“BSPPG”) acquired Simplicity Manufacturing, Inc. (“Simplicity”). Simplicity designs, manufactures and markets a wide variety of premium yard and garden tractors, lawn tractors, riding mowers, snow throwers, attachments, and other lawn and garden products like rototillers and chipper shredders. The purchase price included ~~$240.9~~$246.6 million of cash, a ~~$10.0~~$5.9 million liability for future tax benefits, ~~subject to adjustment based on the actual tax benefits received~~ and $130.1 million of liabilities assumed. The cash paid included $17.8 million of cash acquired and $9.3 million of direct acquisition costs.

The Simplicity acquisition has been accounted for using the purchase method of accounting. The purchase price was allocated on a preliminary basis to identifiable assets acquired and liabilities assumed based upon their estimated fair values, with the excess purchase price recorded as goodwill. Final adjustments to the purchase price allocation, which will include the resolution of certain tax matters, are not expected to be material to the consolidated financial statements.

The following table summarizes the ~~estimated~~ fair value of the assets acquired and liabilities assumed at the date of acquisition:


	(In thousands)		(In thousands)
Assets Acquired:
Current assets	$	122,294	$	122,294
Property, plant and equipment		62,960		62,960
Goodwill		96,808		98,289
Other intangible assets		98,120		98,120
Other noncurrent assets		866		866

Total assets acquired		381,048
Total assets				382,529

Liabilities Assumed:
Current liabilities		47,916		47,916
Deferred tax liabilities		45,002		45,002
Post retirement benefits		36,665		36,665
Other noncurrent liabilities		502		502

Total liabilities assumed		130,085
Total liabilities				130,085

Net assets acquired	$	250,963
Net assets			$	252,444

Other intangible assets are comprised of trademarks, patents and customer relationships. Patents have been assigned an estimated weighted average useful life of thirteen years. The customer relationships have been assigned an estimated useful life of twenty-five years. The ~~patents~~patent and customer relationships are being amortized on a straight-line basis. The trademarks and goodwill, which are considered to have an indefinite life and will not be amortized, will be tested annually for impairment.

~~BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES~~

The following table summarizes pro forma results for the three and ~~six~~nine months ended ~~December~~March 28, ~~2003~~2004, as though the business combination had been completed at the beginning of the earliest comparable period (in thousands, except per share data):


	Three Months Ended		Six Months Ended		Three Months Ended		Nine Months Ended
	December 28, 2003		December 28, 2003		March 28, 2004		March 28, 2004
Net sales	$	475,652	$	873,301	$	744,338	$	1,617,639
Net income	$	18,034	$	22,958	$	73,415	$	96,373

Basic earnings per share	$	0.41	$	0.52	$	1.66	$	2.17
Diluted earnings per share	$	0.38	$	0.50	$	1.48	$	1.98

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

On February 11, 2005, Briggs & Stratton Corporation and its subsidiary, Briggs & Stratton Power Products Group, LLC (collectively “Briggs”) acquired certain assets of Murray, Inc. and Murray Canada Co. (collectively “Murray”) and entered into a transition supply agreement (“TSA”). The TSA gives Briggs the right to purchase finished lawn, garden and snow products from Murray for a period up to eighteen months. The cash purchase price was $121.3 million, including direct acquisition costs of $0.4 million. The Company financed the acquisition through the issuance of $125 million variable rate Term Notes due February 11, 2008, with no prepayment penalty. The Term Notes have financial and operating restrictions consistent with our other debt agreements, as disclosed in our Annual Report on Form 10-K. Although no liabilities were assumed pursuant to the asset purchase agreement, there are certain consumer and customer related obligations incident to the acquisition that have been considered. In addition, there were certain obligations created by the TSA that have been considered in our preliminary purchase accounting.

The Murray acquisition has been accounted for using the purchase method of accounting. The purchase price was allocated on a preliminary basis to identifiable assets acquired and liabilities recognized (as discussed above) based upon their estimated fair values. The estimated fair value of Murray assets acquired exceeded the acquisition cost by $19.8 million, after all tax considerations, and this amount was recognized as an extraordinary gain in the current quarter. Final adjustments to the purchase price allocation are not expected to be material to the consolidated financial statements.

The following table summarizes the fair value of the assets acquired and liabilities recognized at the date of acquisition:


	(In thousands)
Assets Acquired:
Accounts receivable	$	78,409
Inventory		83,665

Total assets		162,074

Liabilities Recognized:
Federal and state taxes payable		10,200
Rebates		4,241
Warranty		3,500
TSA obligations		3,052

Total liabilities		20,993

Net assets	$	141,081

New Accounting Pronouncements

In December 2004, the FASB issued Statement 123R, “Share-Based Payment,”,” to be effective for ~~interim or~~ annual periods beginning after June 15, 2005; thereby, becoming effective for Briggs & Stratton in the first quarter of fiscal 2006. Statement 123R requires all share-based payments to employees, including grants of employee stock options, to be recognized as an operating expense in the income statement. The cost is recognized over the requisite service period based on fair values measured on grant dates. The new standard may be adopted using either the modified prospective transition method or the modified retrospective method. We are currently evaluating our share-based employee compensation programs, the potential impact of this statement on our consolidated financial position and results of operations, and the alternative adoption methods.

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 and in~~notes. In May 2001, the Company issued $275 million of 8.875% senior notes and in February 2005, the Company issued $125 million of variable rate term notes. In addition, Briggs & Stratton has a ~~$275~~$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”), BSPPG and effective July 7, 2004, 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):


	December 26, 2004 Carrying Amount		Maximum Guarantee		March 27, 2005 Carrying Amount		Maximum Guarantee
8.875% Senior Notes, due March 15, 2011	$	271,445	$	275,000	$	271,589	$	275,000

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

7.25% Senior Notes, due September 15, 2007	$	89,496	$	90,000	$	89,542	$	90,000

Revolving Credit Facility, expiring May 2009	$	163,308	$	275,000	$	9,850	$	350,000

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

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

BALANCE SHEET

As of ~~December 26, 2004~~March 27, 2005

(In thousands)


	Briggs & Stratton Corporation		Guarantor Subsidiary		Non-Guarantor Subsidiaries		Eliminations			Consolidated		Briggs & Stratton Corporation		Guarantor Subsidiary		Non-Guarantor Subsidiaries		Eliminations			Consolidated
Current Assets	$	734,895	$	300,065	$	319,857	$	(336,422	)	$	1,018,395	$	633,214	$	507,663	$	296,242	$	(312,409	)	$	1,124,710
Investment in Subsidiaries		603,526		—		—		(603,526	)		—		751,417		—		—		(751,417	)		—
Non-Current Assets		467,719		434,722		13,061		—			915,502		474,110		436,456		15,456		—			926,022

	$	1,806,140	$	734,787	$	332,918	$	(939,948	)	$	1,933,897	$	1,858,741	$	944,119	$	311,698	$	(1,063,826	)	$	2,050,732

Current Liabilities	$	460,662	$	107,245	$	268,270	$	(325,810	)	$	510,367	$	312,149	$	170,937	$	237,611	$	(300,328	)	$	420,369
Payable to Seller													—		5,870		—		—			5,870
Long-Term Debt		360,941		—		—		—			360,941		486,131		—		—		—			486,131
Other Long-Term Obligations		147,459		88,366		298		—			236,123		147,168		89,680		302		—			237,150
Shareholders’ Investment		837,078		539,176		64,350		(614,138	)		826,466		913,293		677,632		73,785		(763,498	)		901,212

	$	1,806,140	$	734,787	$	332,918	$	(939,948	)	$	1,933,897	$	1,858,741	$	944,119	$	311,698	$	(1,063,826	)	$	2,050,732

BALANCE SHEET

As of June 27, 2004

(In thousands)


	Briggs & Stratton Corporation		Guarantor Subsidiary		Non-Guarantor Subsidiaries		Eliminations			Consolidated
Current Assets	$	739,007	$	243,300	$	227,786	$	(228,100	)	$	981,993
Investment in Subsidiaries		352,207		—		—		(352,207	)		—
Non-Current Assets		471,395		175,439		8,326		—			655,160

	$	1,562,609	$	418,739	$	236,112	$	(580,307	)	$	1,637,153

Current Liabilities	$	226,627	$	111,992	$	180,791	$	(218,849	)	$	300,561
Long-Term Debt		360,562		—		—		—			360,562
Other Long-Term Obligations		148,574		9,861		—		—			158,435
Shareholders’ Investment		826,846		296,886		55,321		(361,458	)		817,595

	$	1,562,609	$	418,739	$	236,112	$	(580,307	)	$	1,637,153

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

STATEMENT OF INCOME

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

(In thousands)


	Briggs & Stratton Corporation			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated			Briggs & Stratton Corporation			Guarantor Subsidiary			Non-Guarantor 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 Expense		(8,690	)		4			(31	)		(78	)		(8,795	)		(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 Before Income Taxes		10,179			52			4,074			(3,535	)		10,770			106,763			13,567			(2,324	)		(25,832	)			92,174
Provision 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

(In thousands)


	Briggs & Stratton Corporation			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated			Briggs & Stratton Corporation			Guarantor Subsidiary			Non-Guarantor 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 from Operations		7,427			5,057			5,521			(1,663	)		16,342			95,712			18,323			3,056			(3,265	)		113,826
Interest Expense		(16,265	)		(24	)		(72	)		(553	)		(16,914	)		(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 Before Income Taxes		5,670			4,989			5,460			(7,677	)		8,442			112,433			18,556			3,136			(33,509	)		100,616
Provision 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	$	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 INCOME

For the Three Months Ended ~~December~~March 28, ~~2003~~2004

(In thousands)


	Briggs & Stratton Corporation			Guarantor Subsidiary				Non-Guarantor Subsidiaries				Eliminations			Consolidated
	Briggs & Stratton Corporation							Non-Guarantor Subsidiaries			Briggs & Stratton Corporation							Guarantor Subsidiary				Non-Guarantor Subsidiaries				Eliminations				Consolidated
Net Sales	$	348,754		Guarantor Subsidiary			$	89,512			$	Eliminations	35,504		Consolidated	$	(57,786	)		$	415,984			$	560,741			$	120,930			$	45,120		$	(72,110	)	$	654,681
Cost of Goods Sold		273,160			78,403				28,602				(55,027	)		325,138				413,658				107,630				34,280				(68,654	)		486,914

Gross Profit		75,594			11,109				6,902				(2,759	)		90,846				147,083				13,300				10,840				(3,456	)		167,767
Engineering, Selling, General and Administrative Expenses		41,642			5,992				4,536				—			52,170				39,957				6,059				7,247				—			53,263

Income from Operations		33,952			5,117				2,366				(2,759	)		38,676				107,126				7,241				3,593				(3,456	)		114,504
Interest Expense		(9,464	)		(2	)			(21	)			(109	)		(9,596	)			(9,494	)			—				(10	)			(99	)		(9,603	)
Other Income (Expense), Net		3,856			(15	)			42				(2,618	)		1,265				5,715				(14	)			271				(3,505	)		2,467

Income Before Income Taxes		28,344			5,100				2,387				(5,486	)		30,345				103,347				7,227				3,854				(7,060	)		107,368
Provision for Income Taxes		9,414			1,793				208				(1,705	)		9,710				34,678				3,194				827				(2,599	)		36,100

Net Income	$	18,930		$	3,307			$	2,179			$	(3,781	)	$	20,635			$	68,669			$	4,033			$	3,027			$	(4,461	)	$	71,268

STATEMENT OF INCOME

For the ~~Six~~Nine Months Ended ~~December~~March 28, ~~2003~~2004

(In thousands)


	Briggs & Stratton Corporation			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated			Briggs & Stratton Corporation			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net Sales	$	572,068		$	206,839		$	66,232		$	(97,760	)	$	747,379		$	1,132,809		$	327,769		$	111,352		$	(169,870	)	$	1,402,060
Cost of Goods Sold		459,479			180,590			52,497			(96,228	)		596,338			873,137			288,220			86,777			(164,882	)		1,083,252

Gross Profit		112,589			26,249			13,735			(1,532	)		151,041			259,672			39,549			24,575			(4,988	)		318,808
Engineering, Selling, General and Administrative Expenses		76,101			11,859			10,110			—			98,070			116,058			17,918			17,357			—			151,333

Income from Operations		36,488			14,390			3,625			(1,532	)		52,971			143,614			21,631			7,218			(4,988	)		167,475
Interest Expense		(19,239	)		(2	)		(40	)		(147	)		(19,428	)		(28,733	)		(2	)		(50	)		(246	)		(29,031	)
Other Income (Expense), Net		13,292			(30	)		60			(10,614	)		2,708			19,007			(44	)		331			(14,119	)		5,175

Income Before Income Taxes		30,541			14,358			3,645			(12,293	)		36,251			133,888			21,585			7,499			(19,353	)		143,619
Provision for Income Taxes		9,773			5,046			664			(3,883	)		11,600			44,451			8,240			1,491			(6,482	)		47,700

Net Income	$	20,768		$	9,312		$	2,981		$	(8,410	)	$	24,651		$	89,437		$	13,345		$	6,008		$	(12,871	)	$	95,919

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

STATEMENT OF CASH FLOWS

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

(In thousands)


	Briggs & Stratton Corporation			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated			Briggs & Stratton Corporation			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net Cash (Used in) Provided by Operating Activities	$	(292,169	)	$	55,133		$	(6,140	)	$	(2,810	)	$	(245,986	)	$	(89,661	)	$	39,120		$	(4,379	)	$	6,715		$	(48,205	)

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 Disposition of Plant and Equipment		325			4			3			—			332			557			10			191			—			758
Proceeds Received on Sale of Briggs & Stratton Canada		—			—			4,050			—			4,050			—			—			4,050			—			4,050
Cash Paid for Acquistion, Net of Cash Acquired		(719	)		(222,394	)		—			—			(223,113	)		(719	)		(332,662	)		(16,663	)		—			(350,044	)
Cash Investment in Subsidiary																	(369,148	)		—			(12,469	)		381,617			—
Investment in Joint Venture																	(1,500	)		—			—			—			(1,500	)
Dividends Received		11,517			—			500			—			12,017			18,674			—			(323	)		—			18,351
Capital Contributions in Subsidiary		(244,561	)		—			(1	)		244,562			—

Net Cash Used in Investing Activities		(261,941	)		(228,049	)		(668	)		244,562			(246,096	)		(397,230	)		(341,874	)		(31,925	)		381,617			(389,412	)

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 Paid																	(17,455	)		—			(5,801	)		5,754			(17,502	)
Capital Contributions Received																	—			349,542			32,075			(381,617	)		—
Proceeds from Exercise of Stock Options		17,648			—			—			—			17,648			19,037			—			—			—			19,037
Capital Contributions Received		—			239,277			5,285			(244,562	)		—
Dividends Paid		(8,694	)		—			(4,989	)		4,989			(8,694	)

Net Cash Provided by Financing Activities		238,726			171,604			1,326			(241,752	)		169,904			179,273			304,573			37,591			(388,332	)		133,105

Effect of Exchange Rate Changes		(1	)		—			3,863			—			3,862			—			—			2,873			—			2,873

Net (Decrease) Increase in Cash and Cash Equivalents		(315,385	)		(1,312	)		(1,619	)		—			(318,316	)		(307,618	)		1,819			4,160			—			(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		$	19,191		$	5,826		$	15,738		$	—		$	40,755

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

STATEMENT OF CASH FLOWS

For the ~~Six~~Nine Months Ended ~~December~~March 28, ~~2003~~2004

(In thousands)


	Briggs & Stratton Corporation			Guarantor Subsidiary				Non-Guarantor Subsidiaries				Eliminations			Consolidated
	Briggs & Stratton Corporation							Non-Guarantor Subsidiaries			Briggs & Stratton Corporation							Guarantor Subsidiary				Non-Guarantor Subsidiaries				Eliminations				Consolidated
Net Cash (Used in) Provided by Operating Activities	$	(214,536	)	Guarantor Subsidiary			$	9,397			$	Eliminations	(23,982	)	Consolidated	$	18,207			$	(210,914	)		$	(81,486	)		$	(49,779	)		$	(17,308	)		$	17,920	$	(130,653	)

Cash Flows from Investing Activities:
Additions to Plant and Equipment		(19,307	)		(3,268	)			(569	)			—			(23,144	)			(30,052	)			(4,506	)			(898	)			—				(35,456	)
Proceeds Received on Disposition of Plant and Equipment		293			6				—				—			299				556				61				—				—				617
Dividends Received																				3,725				—				—				—				3,725
Refund of Cash Paid for Acquisition		5,686			—				—				—			5,686				5,686				—				(225	)			—				5,461
Dividends Received		3,500			—				—				—			3,500

Net Cash Used in Investing Activities		(9,828	)		(3,262	)			(569	)			—			(13,659	)			(20,085	)			(4,445	)			(1,123	)			—				(25,653	)

Cash Flows from Financing Activities:
Net Borrowings (Repayments) on Loans and Notes Payable		8,545			(8,037	)			16,028				(18,207	)		(1,671	)			(52,251	)			52,762				17,078				(17,920	)			(331	)
Dividends Paid		(7,285	)		—				—				—			(7,285	)			(14,667	)			—				—				—				(14,667	)
Proceeds from Exercise of Stock Options		24,701			—				—				—			24,701				29,415				—				—				—				29,415

Net Cash Provided by (Used in) Financing Activities		25,961			(8,037	)			16,028				(18,207	)		15,745				(37,503	)			52,762				17,078				(17,920	)			14,417

Effect of Exchange Rate Changes		—			(675	)			4,011				—			3,336				—				(675	)			2,549				—				1,874

Net Decrease in Cash and Cash Equivalents		(198,403	)		(2,577	)			(4,512	)			—			(205,492	)			(139,074	)			(2,137	)			1,196				—				(140,015	)
Cash and Cash Equivalents, Beginning		304,103			1,575				19,137				—			324,815				304,103				1,575				19,137				—				324,815

Cash and Cash Equivalents, Ending	$	105,700		$	(1,002	)		$	14,625			$	—		$	119,323			$	165,029			$	(562	)		$	20,333			$	—			$	184,800

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

~~ITEM 2.~~

~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS~~

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

~~Net~~Consolidated net sales for the ~~second~~third quarter of fiscal 2005 totaled ~~$504~~$840 million, an increase of ~~$88~~$186 million or ~~21%~~28% when compared to fiscal 2004. The ~~majority of the~~ increase is attributable primarily to the inclusion of $108 million in sales from Simplicity and the inclusion of $72 million in sales of ~~sales from~~Murray product, both acquired in the ~~Simplicity acquisition in July 2004. The remaining increase was driven by improved performance of the Engine Segment.~~current fiscal year.

~~Second~~Third quarter net sales for the Engine Segment were ~~$375 million versus $358~~$605 million in fiscal 2004, an increase of $17 million or 5%. Pricing improvements, which included the favorable impact of the Euro exchange rate, accounted for $13 million of the increase. The remaining increase is due to $11 million from a mix of engines that favored higher priced models offset by a $5 million reduction in net sales due to lower unit volume. Engine unit shipments were down 3% between years, with shipments to our Power Products Segment up $2 million between years. We believe the engine unit decline is attributable to timing2005 and ~~should reverse in future periods.~~

~~Second quarter Power Products Segment net sales were $171 million versus $98~~$582 million in fiscal 2004. The ~~$73~~4%, or $23 million, improvement is the result of a 12% increase ~~was driven entirely~~in engine shipments that contributed $56 million and a $15 million benefit from favorable exchange rate on Euro denominated sales. These increases were partially offset by an engine mix that favored lower priced product resulting in a net sales reduction of $27 million, lower service parts and component sales of $13 million and an increase in sales incentives in the period. The engine mix and sales incentives were the expected reversals of the favorable experience from the first half of the year. The reduction in service parts and component sales reflects the efforts of our independent distribution network to reduce its inventories in the current year.

Third quarter Power Products Segment sales were $324 million versus $126 million in the same period a year ago. The $198 million improvement is primarily the result of the inclusion of $108 million of sales from Simplicity and $72 million in net sales from the Murray asset acquisition. The remaining increase was the result of ~~Simplicity sales in the current year.~~generator and pressure washer volume increases. Generator net sales increased 15% ~~in the current year, driven~~while unit volume increased 12%. Generator demand continues to be strong due to continued replenishment of inventory caused by the ~~continuing replenishment~~major hurricane activity in this year’s first fiscal quarter. Net sales growth also reflects price increases instituted in January 2005. Pressure washer net sales increased 17% while unit volume increased 29%. The volume growth reflects the build-up of redesigned product at retail ~~inventories due to~~in anticipation of spring and summer demand, as well as the ~~active hurricane season.~~placement of incremental SKU’s at retail. The unprecedented four hurricanes in the current fiscal year significantly depleted retail inventories beyond the prior year’s experience that included only one hurricane and the East Coast blackout. We believe the replenishment activity will continue into the third quarter. These generator gains however, were fully offset by 13% lower pressure washer sales ~~due to a decline in unit volume. While retail sales~~mix of pressure washers increased year over year, our shipments of pressure washer units declined as retailers lowered their inventories in anticipation of new product offerings in the spring. We also believe this unit decline is attributable to timing and should reverse in the future.favored smaller, lower priced units.

~~Net~~Consolidated net sales for the ~~six months~~nine-months ended ~~December 26, 2004~~March 27, 2005 totaled ~~$943~~$1,783 million, an increase of ~~$195~~$381 million or ~~26% compared to~~27%. This increase reflects the ~~first six months of the prior year. The~~ inclusion of ~~$152~~$260 million in net sales from Simplicity and $72 million of ~~Simplicity sales accounts for the majority of the increase between years; with generator volume improvements accounting for the remaining~~ net sales ~~gain.~~of Murray product in the current year.

~~Six-month net~~Nine-months sales for the Engine Segment ~~were $629~~totaled $1,234 million in fiscal 2005 versus ~~$592~~$1,174 million in the prior year, a ~~$ 37~~5% or $60 million ~~or 6%~~ improvement. ~~While~~The main drivers for the net sales increases were; $40 million from an engine unit ~~shipments were down 3%, a~~shipment increase of 4% and $33 million from favorable mix of higher priced product accounted for the majority of the change. The remaining improvement is attributable to increases in selling prices totaling $17 million, which includes the impact of a favorableprice and Euro exchange ~~rate.~~rates. Offsetting these increases were lower service parts and component sales of $14.3 million, primarily in the third quarter.

Power Products Segment net sales for ~~the first six months~~nine-months were ~~$393~~$715 million ~~versus $223~~compared to $349 million in the prior year. ~~The~~As previously discussed, this increase reflects the inclusion of ~~$152 million of net~~ sales from ~~the~~our Simplicity ~~acquisition~~and Murray acquisitions of $260 million and $72 million, respectively. The remaining improvement was the ~~major driver~~result of ~~the increase. Generator~~a generator sales ~~were also up 23% between years~~increase of 20% due to ~~significant~~a volume increase as a result of hurricane activity in the first fiscal quarter. Pressure washer sales were up 3% on a 9% unit volume increase. The ~~generator gains were partially offset by a 15% decrease in~~mix of pressure washer sales ~~attributable to~~favored smaller, lower ~~unit volume for the same reasons noted for the second quarter.~~priced units.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

GROSS PROFIT MARGIN

The consolidated gross profit margin decreased to 20% from 26% experienced in the ~~second quarter~~preceding year’s third quarter. Engine Segment margins decreased from 27% in the prior year to ~~21% from~~ 22% in the ~~same period a year ago. Engine Segment margins increased from 23% in fiscal 2004 to 24% in fiscal 2005.~~current year. This ~~improvement~~decline in margin was driven primarily by ~~the pricing initiatives, which included the impact of~~ a ~~stronger Euro exchange rate between years. Partially offsetting these gains was $9~~$23 million increase in ~~increased~~ manufacturing costs. The majority of the cost increases reflect ~~initiatives by vendors to increase~~$16 million from increased prices on aluminum and steel. We are anticipating raw material and component costs to remain at these higher levels for the ~~entire~~remainder of the fiscal year. The remaining increase in manufacturing costs is attributable to $7 million in increased overhead costs, such as utilities and fringe benefits, which were not offset by our ongoing cost reduction efforts. Lower production volume, resulting in $6 million of lower fixed costs absorption, also contributed to the lower Engine Segment margins. Pricing initiatives and a stronger Euro, offset by a negative mix of product that favored lower margined units, contributed $12 million to the Engine Segment margins in the third quarter, but this was not enough to overcome the cost increases. Power Products Segment margins ~~for~~were 11% in the ~~second~~third quarter ~~decreased from 12% in~~of fiscal ~~2004 to 10% in~~2005 and fiscal ~~2005.~~2004. The acquisition of Simplicity contributed margins of $9$17 million ~~or an increase in margin of 5%,~~(7% gross margin) after the application of purchase accounting on acquired inventory. ~~Offsetting this increase was approximately $6 million~~Murray sales in ~~cost increases associated with expediting production in order to meet generator demand created~~the third quarter were at zero margin after the application of purchase accounting. This reduced the overall segment margin by ~~storm activity, market driven cost increases~~3%. The margin on ~~steel~~generators and ~~copper, and 43% lower production levels of~~ pressure ~~washers. Production levels were down~~washers improved between years due to ~~increased inventory levels at~~lower spending on manufacturing costs in the ~~end of last fiscal year and our investment~~quarter, an 11% increase in ~~more efficient capacity~~unit production driven primarily by anticipated demand for pressure ~~washer assembly that will allow us to build closer to the season in the spring~~washers, and a favorable mix of ~~fiscal 2005.~~higher margined pressure washers.

The consolidated gross profit margin for the ~~six-month~~nine-month period decreased from ~~20%~~22% in the prior year to 19% in the current year. The Engine Segment margin decreased from 24% in fiscal 2004 to ~~19%~~22% in fiscal 2005. ~~The Engine Segment margins remained flat at 21% in both fiscal years. The favorable impact~~Manufacturing cost increases of $56 million consisting primarily of increased aluminum and steel prices, were only partially offset by pricing initiatives ~~the~~and a favorable Euro ~~and better absorption were offset by manufacturing cost increases.~~exchange rate. Power Products Segment margins for the ~~six-month~~nine-month period decreased from ~~13%~~12% in ~~fiscal 2004~~the prior year to 11% in ~~fiscal 2005.~~the current year. The acquisition of Simplicity contributed ~~$20~~$38 million ~~or 5% to the margin~~(6% gross margin) after the application of purchase accounting on acquired inventory. ~~Offsetting this increase was approximately $14 million in~~Murray sales were at zero margin after the application of purchase accounting. This reduced the overall segment margin by 1%. The margins on the generator and pressure washer business were flat between years. The impact of lower production volumes and manufacturing cost increases were offset by the increased ~~costs for the same reasons noted in the second quarter discussion, as well as, increased promotion activity on pressure washers primarily in the first quarter.~~generator sales volume and price increases.

ENGINEERING, SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Engineering, selling, general and administrative expenses were ~~$93~~$68 million in the ~~second~~third quarter of fiscal 2005 versus ~~$52~~$53 million in fiscal 2004. The ~~$40~~$15 million increase is attributable to ~~a $30 million increase in the allowance for doubtful accounts and~~ the inclusion ~~of $13 million~~ of Simplicity expenses in the current year, partially offset by lower fringe benefit costs between years. The increase reflects the write down of the remaining trade receivable due from Murray, Inc., an original equipment manufacturer and our third largest customer who filed for bankruptcy protection.year.

~~The~~This category increased ~~$63~~$78 million for the ~~six-month~~nine-month comparative periods. The ~~write down~~write-down of the trade receivable from Murray ~~Inc.~~ accounts for ~~$40~~$39 million of the increase. The remaining increase is attributable to the inclusion of ~~$25~~$39 million in expenses ~~from the Simplicity acquisition in the current year, offset by lower fringe benefits.~~of Simplicity.

INTEREST EXPENSE

Interest expense ~~decreased $1~~was $10 million in the ~~second quarter~~third quarters of fiscal 2005 ~~versus the second quarter of~~and fiscal 2004. ~~The decrease reflects reduced borrowings and lower interest rates between years.~~ Interest expense decreased $2 million ~~in the six-month comparison~~ for the ~~same reasons.~~nine-month comparative periods. The decrease is attributable to lower borrowings between years.

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~~2005 and 2004 was 34%. ~~This is management’s estimate of what the~~The effective tax rate ~~will be for the entire 2005 fiscal year. Last year’s rate~~ was ~~32% for the second quarter and the six-month periods. The fiscal 2004 rate was ultimately increased to~~ 34% for the ~~full 2004~~ fiscal 2005 nine-month period and 33% in the prior year. The increase in the rate ~~for~~in the current ~~quarter and~~ year ~~is attributable to increased earnings expectations, expected~~reflects decreases in foreign income and state tax credits and the elimination of the tax benefit from the closing of a tax audit year.

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 selected assets acquired from Murray and the cash paid, after all tax considerations.

LIQUIDITY AND CAPITAL RESOURCES

Cash used in operating activities for the ~~six-month~~nine-month period of fiscal 2005 was ~~$246~~$48 million, ~~an increase~~a decrease of ~~$35~~$83 million from fiscal ~~2004. Increased~~2004, driven by reduced working capital requirements. The nine-month period of fiscal 2005 experienced less of an inventory ~~levels~~build-up than the prior year. This was driven primarily by lower generator and pressure washer inventories in the ~~primary reason for~~current year. In addition, receivables were lower between years attributable to the ~~increase in cash used in operating activities between years. The inventory levels reflect our belief in a strong upcoming retail season and~~elimination of the ~~need to have inventory available to meet anticipated customer demand.~~Murray receivable.

In the ~~six-month~~nine-month period of fiscal 2005, we used ~~$246~~$389 million in investing activities compared to ~~$14~~$26 million in fiscal 2004. $350 million of cash was used on acquisitions in the current year. The ~~$232~~acquisition of Simplicity used $229 million ~~increase in~~of cash ~~used in investing activities reflects $223~~and $121 million of cash was used for the acquisition of ~~Simplicity.~~selected Murray assets. Planned increases in capital spending of ~~$16~~$26 million and an investment in a joint venture of $2 million were partially offset by ~~$4 million~~cash received on the sale of certain assets of ~~Briggs & Stratton Canada.~~a subsidiary. In the prior year, we received $6 million as a refund of a portion of the cash paid for the BSPPG acquisition in fiscal 2001. The amount was to adjust the original purchase price for the actual value received in acquired receivables and inventory. ~~While there~~No such refund was ~~no such refund~~received in the current ~~year,~~year. In 2005 we ~~did experience a $9~~received $13 million ~~increase~~ in cash dividends ~~received, primarily~~ from our equity investment in Metal Technologies, Inc., the entity that acquired our two ductile iron foundries in August 1999. These were our first dividends from this investment.

Net cash provided by financing activities was $133 million in fiscal 2005, a $119 million increase from the net cash provided by financing activities in fiscal 2004. The increase is attributable primarily to ~~which we sold our ductile~~the issuance of $125 million of Term Notes used to finance the acquisition of selected Murray assets in the current year. Increased dividend payments of $3 million and ~~grey iron foundries.~~lower cash from stock option activity in the current year of $10 million, were partially offset by increased net borrowings under pre-existing loan agreements of $7 million.

FUTURE LIQUIDITY AND CAPITAL RESOURCES

~~As previously noted,~~On March 18, 2005 we ~~have reached an~~increased the maximum amount available under our Revolving Credit Facility to $350 million from $275 million. The amended agreement ~~to purchase certain assets of Murray subject to bankruptcy and regulatory approvals. This transaction would be financed using a~~expires in May 2009.

The $125 million ~~term loan. This loan would be~~of Term Notes issued on February 11, 2005, require a payment of $40 million on August 11, 2006 with the remainder due ~~in three years and has~~February 11, 2008, there is no prepayment penalty. These Notes were used to finance the acquisition of selected Murray assets. We do not believe the ~~term loan~~Term Notes or the acquisition of ~~certain~~selected assets of Murray will significantly alter our future liquidity and capital needs.

We acquired Simplicity in July 2004, using available cash. We do not believe the acquisition of Simplicity will significantly alter our future liquidity and capital needs given its profitability and existing receivable financing arrangements. ~~We also do not believe the collectibility of the $40 million receivable from Murray, Inc. will significantly alter our future liquidity.~~

We have remaining authorization to buy up to 1.8 million shares of our stock in open market or private transactions under the June 2000 Board of Directors’ authorization to repurchase up to 2.0 million shares. We did not purchase any shares in the first ~~half of fiscal 2005 and do not anticipate repurchasing any shares during the remainder~~nine-months of fiscal 2005.

Management expects cash outflows for capital expenditures to be approximately $80 to $87 million in fiscal 2005. These anticipated expenditures provide for continued investments 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 ~~ARRANGEMENT~~ARRANGEMENTS

There have been no material changes since the September 9, 2004 filing of the Company’s Annual Report on Form 10-K.

CONTRACTUAL OBLIGATIONS

There have been no material changes since the September 9, 2004 filing of the Company’s Annual Report on Form ~~10-K.~~

~~BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES~~10-K other than the issuance of $125 million in variable rate Term Notes with $40 million due August 11, 2006 and the remainder due February 11, 2008. As of March 27, 2005, the interest rate on these notes was 4.04%. As a result, the Company will incur additional interest expense of approximately $1.9 million, $5.1 million, $3.7 million and $2.1 million in fiscal years 2005, 2006, 2007 and 2008, respectively on these notes.

CRITICAL ACCOUNTING POLICIES

There have been no material changes in Briggs & Stratton’s critical accounting policies since the September 9, 2004 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 United ~~States.~~States 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~~can 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”, “approval”, “believe”, “conditions”, “determine”, “estimate”, “evaluate”, “expect”, “forecast”, ~~“if”~~

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

“if”, “intend”, “may”, “negotiate”, “objective”, “outcome”, “plan”, “project”, “seek”, “subject to”, “think”, “will”, and similar expressions are intended to identify forward-looking statements. The forward-looking statements are based on the Company’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 purchased raw materials and parts that we purchase; changes in domestic economic conditions, including housing starts and changes in consumer disposable income; changes in foreign economic conditions, including currency rate fluctuations; new facts that come to light in the future course of litigation proceedings which could affect our assessment of those matters; a successful transition supply agreement with Murray; the actions of other suppliers and the customers of Murray; the ability to successfully realize the maximum market value of acquired assets; work stoppages or other consequences of any deterioration in Murray’s employee relations; 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.

~~ITEM 3.~~

~~QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK~~

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes since the September 9, 2004 filing of the Company’s Annual Report on Form 10-K.

~~BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES~~

~~ITEM 4.~~

~~CONTROLS AND PROCEDURES~~

ITEM 4. CONTROLS AND PROCEDURES

DISCLOSURE CONTROLS AND PROCEDURES

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’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 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 in the reports that it files or submits under the Exchange Act.~~effective.

INTERNAL CONTROL OVER FINANCIAL REPORTING

There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

PART II - OTHER INFORMATION

~~Item 4.~~

~~SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS~~

ITEM 1. Legal Proceedings

AtBriggs & Stratton is subject to various unresolved legal actions which arise in the ~~Annual Meeting~~normal course of ~~Shareholders on October 20, 2004, director nominees were elected~~its business, the most prevalent of which relate to ~~a three-year term expiring in 2007. For further information reference Part II, Item 4 of Form 10-Q for the quarterly period ended September 26, 2004.~~product liability (including asbestos-related liability) and patent and trademark matters.

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 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. The Company intends to vigorously defend this case. 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 or results of operations.

~~Item 6.~~

~~EXHIBITS~~

ITEM 6. EXHIBITS


Exhibit Number		Description
10.1		Asset Purchase Agreement, dated January 25, 2005, by and among Briggs & Stratton Power Products Group, LLC, Briggs & Stratton Canada Inc., Murray, Inc. and Murray Canada Co. (Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated January 25, 2005)

10.2		Transition Supply Agreement, dated February 11, 2005, between Briggs & Stratton Power Products Group, LLC and Murray, Inc. (Form of Transition Supply Agreement filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K dated January 25, 2005)

10.3 (a)		Term Loan Agreement, dated February 11, 2005, among Briggs & Stratton Corporation and LaSalle Bank N.A., as syndication agent, and Bank of America, N.A., as administrative agent (Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated February 11, 2005)

10.3 (b)		Term Loan Agreement Amendment, dated March 18, 2005, among Briggs & Stratton Corporation, various financial institutions and Bank of America, N.A., as administrative agent (Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated March 18, 2005)

10.4 (a)		Multicurrency Credit Agreement dated May 28, 2004, among Briggs & Stratton Corporation, the financial institutions party hereto, and LaSalle Bank National Association, M&I Marshall & Ilsley Bank and U.S. Bank National Association, as co-documentation agents, and Bank of America, N.A., as administrative agent, issuing bank and swing line bank (Filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K dated March 18, 2005)

10.4 (b)		Multicurrency Credit Agreement Amendment dated March 18, 2005, among Briggs & Stratton Corporation, various financial institutions and Bank of America, N.A., as administrative agent (Filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K dated March 18, 2005)

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

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

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

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

~~Filed herewith~~

~~Furnished herewith~~

BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES

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
		~~BRIGGS & STRATTON CORPORATION~~ (Registrant)

Date: ~~February 3,~~May 4, 2005		/s/ James E. Brenn
		James E. Brenn
		Senior Vice President and Chief Financial Officer and
	Duly Authorized Officer

~~BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES~~

EXHIBIT INDEX


Exhibit Number		Description
10.1		Asset Purchase Agreement, dated January 25, 2005, by and among Briggs & Stratton Power Products Group, LLC, Briggs & Stratton Canada Inc., Murray, Inc. and Murray Canada Co. (Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated January 25, 2005)

10.2		Transition Supply Agreement, dated February 11, 2005, between Briggs & Stratton Power Products Group, LLC and Murray, Inc. (Form of Transition Supply Agreement filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K dated January 25, 2005)

10.3 (a)		Term Loan Agreement, dated February 11, 2005, among Briggs & Stratton Corporation and LaSalle Bank N.A., as syndication agent, and Bank of America, N.A., as administrative agent (Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated February 11, 2005)

10.3 (b)		Term Loan Agreement Amendment, dated March 18, 2005, among Briggs & Stratton Corporation, various financial institutions and Bank of America, N.A., as administrative agent (Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated March 18, 2005)

10.4 (a)		Multicurrency Credit Agreement dated May 28, 2004, among Briggs & Stratton Corporation, the financial institutions party hereto, and LaSalle Bank National Association, M&I Marshall & Ilsley Bank and U.S. Bank National Association, as co-documentation agents, and Bank of America, N.A., as administrative agent, issuing bank and swing line bank (Filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K dated March 18, 2005)

10.4 (b)		Multicurrency Credit Agreement Amendment dated March 18, 2005, among Briggs & Stratton Corporation, various financial institutions and Bank of America, N.A., as administrative agent (Filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K dated March 18, 2005)

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

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

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

32.2		Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**

*	~~Filed herewith~~

**	~~Furnished herewith~~2002 (Furnished herewith)