<PAGE>

                                  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 September 30, 2000
                                       or

         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 001-13539
                              ---------------------

                                AMF BOWLING, INC.
             (Exact name of Registrant as specified in its charter)

           Delaware                                               13-3873268
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)

                                 8100 AMF Drive
                            Richmond, Virginia 23111
          (Address of principal executive offices, including zip code)
                              --------------------
                                 (804) 730-4000
              (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 _____.

At November 1, 2000,  83,597,550  shares of common stock,  par value of $.01 per
share, of the Registrant were outstanding.
<PAGE>

                                     PART I
Item 1. Financial Statements

                       AMF BOWLING, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                    (dollars in thousands, except share data)

<TABLE>
<CAPTION>
                                                                                    September 30,         December 31,
                                                                                         2000                 1999
                                                                                  ------------------- ---------------------
                                                                                     (unaudited)
<S>                                                                                         <C>                   <C>
    Assets
   Current assets:
    Cash and cash equivalents                                                            $    29,380           $    35,743
    Accounts and notes receivable, net of allowance for
    doubtful accounts of $7,499 and $9,531, respectively                                      69,193                63,175
    Inventories                                                                               70,134                53,499
    Other current assets                                                                      15,984                14,876
                                                                                  ------------------- ---------------------
    Total current assets                                                                     184,691               167,293
   Property and equipment, net                                                               764,205               806,425
   Other assets                                                                               76,916                88,092

   Goodwill, net                                                                             750,192               765,092
                                                                                  ------------------- ---------------------
    Total assets                                                                         $ 1,776,004           $ 1,826,902
                                                                                  =================== =====================

    Liabilities and Stockholders' Equity
   Current liabilities:
    Accounts payable                                                                     $    23,731           $    35,296
    Accrued expenses                                                                          77,998                71,784
    Income taxes payable                                                                       2,086                 3,450
    Current portion of long-term debt                                                         53,750                34,250
    Long-term debt classified as current                                                   1,257,434
                                                                                  ------------------- ---------------------
    Total current liabilities                                                              1,414,999               144,780
   Long-term debt, less current portion                                                            -             1,186,982
   Other long-term liabilities                                                                 4,959                 5,204
                                                                                  ------------------- ---------------------
    Total liabilities                                                                      1,419,958             1,336,966
                                                                                  ------------------- ---------------------
   Commitments and contingencies
   Stockholders' equity:
    Common  stock  (par value $.01 per  share,  200,000,000
    shares  authorized, 83,597,550 shares issued and outstanding
    at September 30, 2000 and December 31, 1999, respectively)                                   836                   836
    Paid-in capital                                                                          905,447               905,610
    Retained deficit                                                                        (520,054)             (401,186)
    Accumulated other comprehensive loss                                                     (30,183)              (15,324)
                                                                                  ------------------- ---------------------
    Total stockholders' equity                                                               356,046               489,936
                                                                                  ------------------- ---------------------

    Total liabilities and stockholders' equity                                           $ 1,776,004           $ 1,826,902
                                                                                  =================== =====================
</TABLE>

  The accompanying notes are an integral part of these condensed consolidated
                                balance sheets.


                                        2
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)
                      (in thousands, except per share data)

<TABLE>
<CAPTION>
                                                                      Three Months                        Nine Months
                                                                   Ended September 30,                Ended September 30,
                                                           --------------------------------- ----------------------------------
                                                                    2000             1999             2000              1999
                                                                    ----             ----             ----              ----
<S>                                                                 <C>              <C>             <C>               <C>
   Operating revenue                                             $ 162,128        $ 182,799        $ 532,287         $ 546,461
                                                           ---------------- ---------------- ----------------  ----------------
   Operating expenses:
    Cost of goods sold                                              37,794           66,191          118,401           143,599
    Bowling center operating expenses                               92,584           92,782          280,608           276,719
    Selling, general, and administrative expenses                   16,119           34,274           44,383            64,719
    Restructuring charges                                                -            7,500                -             7,500
    Refinancing charges                                              2,244                -            2,244                 -
    Depreciation and amortization                                   33,421           37,732          100,562           104,059
                                                           ---------------- ---------------- ----------------  ----------------
    Total operating expenses                                       182,162          238,479          546,198           596,596
                                                           ---------------- ---------------- ----------------  ----------------

    Operating loss                                                 (20,034)         (55,680)         (13,911)          (50,135)
                                                           ---------------- ---------------- ----------------  ----------------

   Nonoperating expenses (income):
    Interest expense                                                34,657           31,080           98,792            95,483
    Other, net                                                       2,336               99            4,003             6,541
    Interest income                                                 (1,005)            (535)          (1,595)           (1,988)
                                                           ---------------- ---------------- ----------------  ----------------
    Total nonoperating expenses                                     35,988           30,644          101,200           100,036
                                                           ---------------- ---------------- ----------------  ----------------

    Loss before income taxes                                       (56,022)         (86,324)        (115,111)         (150,171)
    Provision for income taxes                                         938           23,088            3,036            26,322
                                                           ---------------- ---------------- ----------------  ----------------

    Net loss before equity in loss of joint ventures
      and extraordinary item                                       (56,960)        (109,412)        (118,147)         (176,493)
    Equity in loss of joint ventures                                  (104)             (79)            (721)           (5,780)
                                                           ---------------- ---------------- ----------------  ----------------

    Net loss before extraordinary item                             (57,064)        (109,491)        (118,868)         (182,273)
    Extraordinary item                                                   -           64,460                -            64,460
                                                           ---------------- ---------------- ----------------  ----------------
    Net loss                                                     $ (57,064)       $ (45,031)       $(118,868)        $(117,813)
                                                           ================ ================ ================  ================

    Net loss per share - basic and diluted
         Net loss per share before extraordinary item            $   (0.68)       $   (1.43)       $   (1.42)        $   (2.79)
         Per share effect of extraordinary item                          -             0.84                -              0.99
                                                           --------------------------------------------------------------------
    Net loss per share - basic and diluted                       $   (0.68)       $   (0.59)       $   (1.42)        $   (1.80)
                                                           ================ ================ ================  ================

    Weighted average shares outstanding                             83,598           76,617           83,598            65,335
                                                           ================ ================ ================  ================
</TABLE>

  The accompanying notes are an integral part of these condensed consolidated
                             financial statements.


                                        3
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                              Nine Months
                                                                                           Ended September 30,
                                                                                 ---------------------------------
                                                                                          2000             1999
                                                                                          ----             ----
<S>                                                                                    <C>              <C>
  Cash flows from operating activities:
   Net loss                                                                            $(118,868)       $(117,813)
   Adjustments to reconcile net loss to net cash used in
    operating activities:
     Depreciation and amortization                                                       100,562          104,059
     Equity in loss of joint ventures                                                        721            5,780
     Extraordinary item                                                                        -          (64,460)
     Deferred income taxes                                                                     -           20,830
     Amortization of bond discount                                                        31,359           33,754
     Loss on the sale of property and equipment, net                                         205            2,833
     Changes in assets and liabilities:
     Accounts and notes receivable, net                                                   (9,807)          (1,771)
     Inventories                                                                         (18,699)          12,829
     Other assets                                                                         10,348           (5,945)
     Accounts payable and accrued expenses                                                (3,097)            (388)
     Income taxes payable                                                                   (738)               -
     Other long-term liabilities                                                          (3,862)            (437)
                                                                                 ---------------- ----------------
    Net cash used in operating activities                                                (11,876)         (10,729)
                                                                                 ---------------- ----------------

  Cash flows from investing activities:
   Acquisitions of operating units, net of cash acquired                                  (5,350)          (1,424)
   Purchases of property and equipment                                                   (49,497)         (34,971)
   Proceeds from the sale of property and equipment                                        3,345              744
                                                                                 ---------------- ----------------
    Net cash used in investing activities                                                (51,502)         (35,651)
                                                                                 ---------------- ----------------

  Cash flows from financing activities:
   Proceeds from long-term debt, net of deferred financing costs                          85,000           53,000
   Payments on long-term debt                                                            (26,407)        (128,529)
   Repurchase of common shares                                                                 -             (180)
   Issuance of common shares                                                                   -          119,737
   Rights offering cost                                                                     (163)               -
   Payments of noncompete obligations                                                       (196)            (184)
                                                                                 ---------------- ----------------
    Net cash provided by financing activities                                             58,234           43,844
                                                                                 ---------------- ----------------
    Effect of exchange rates on cash                                                      (1,219)            (284)
                                                                                 ---------------- ----------------
    Net decrease in cash                                                                  (6,363)          (2,820)
    Cash and cash equivalents at beginning of period                                      35,743           33,002
                                                                                 ---------------- ----------------
    Cash and cash equivalents at end of period                                          $ 29,380         $ 30,182
                                                                                 ================ ================

</TABLE>

  The accompanying notes are an integral part of these condensed consolidated
                             financial statements.


                                        4
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1.  Organization and Restructuring

Organization

     The accompanying  unaudited  condensed  consolidated  financial  statements
reflect all adjustments  (consisting of normal recurring accruals) which are, in
the opinion of management,  necessary for a fair  presentation of the results of
operations for the interim periods presented.  The interim financial information
and notes thereto should be read in conjunction with the December 31, 1999, 1998
and 1997 audited consolidated  financial  statements of AMF Bowling,  Inc. ("AMF
Bowling") and its subsidiaries  (collectively,  the "Company")  presented in AMF
Bowling's Annual Report on Form 10-K for the fiscal year ended December 31, 1999
filed  with  the  U.S.  Securities  and  Exchange  Commission.  The  results  of
operations  for the nine months  ended  September  30, 2000 are not  necessarily
indicative of results to be expected for the entire year.

     The  Company is  principally  engaged  in two  business  segments:  (i) the
ownership  and  operation of bowling  centers,  consisting  of 408 U.S.  bowling
centers and 119 international bowling centers ("Bowling Centers"),  including 15
joint venture  centers,  as of September 30, 2000, and (ii) the  manufacture and
sale of bowling  equipment  such as  automatic  pinspotters,  automatic  scoring
equipment,  bowling  pins,  lanes,  ball returns,  certain spare parts,  and the
resale of allied products such as bowling balls,  bags, shoes, and certain other
spare parts ("Bowling  Products").  The principal  markets for bowling equipment
are  U.S.  and  international   bowling  center  operators.   The  Company  also
manufactures  and sells  the  Playmaster,  Highland  and  Renaissance  brands of
billiards  tables,  and owns the Michael  Jordan Golf Company,  which  currently
operates two golf practice ranges.

     AMF Bowling Worldwide, Inc. ("Bowling Worldwide") is a wholly owned, direct
subsidiary of AMF Group Holdings Inc. ("AMF Group Holdings"). AMF Group Holdings
is a wholly  owned,  direct  subsidiary of AMF Bowling.  AMF Bowling,  AMF Group
Holdings and Bowling  Worldwide are Delaware  corporations.  AMF Bowling and AMF
Group Holdings are holding companies. The principal assets in each are comprised
of investments in subsidiaries.  The Company was acquired in 1996 by an investor
group led by affiliates of Goldman, Sachs & Co. (the "Acquisition").

     Since the Acquisition and through  September 30, 2000, AMF Bowling Centers,
Inc., a direct  subsidiary of Bowling  Worldwide,  purchased an aggregate of 267
bowling  centers from various  unrelated  sellers,  and it has  constructed  two
bowling  centers  and one  Michael  Jordan  Golf  practice  range as part of its
capital   expenditure   program.   The  combined  net  purchase  price  for  all
acquisitions  was  approximately  $504.3  million.  The  Company  has funded its
acquisitions and center construction from internally-generated  cash, borrowings
under the senior secured  revolving  credit facility (the "Bank Facility") under
the Credit Agreement (as defined in "Note 5. Long-Term Debt"),  and issuances of
AMF Bowling  common  stock (the  "Common  Stock").  From January 1, 2000 through
September 30, 2000, AMF Bowling Centers, Inc. acquired four bowling centers.

Restructuring

         On August 14, 2000,  Bowling  Worldwide  announced  that it had entered
into an amendment (the "Amendment") to its Credit  Agreement,  that it would not
make the  interest  payment due  September  15, 2000 on its senior  subordinated
notes  (the  "Senior  Subordinated  Notes")  and that it would  begin  exploring
various alternatives to restructure and reduce its long-term debt. As part of
the Amendment, the lenders agreed to waive any default under the Credit
Agreement resulting from the failure to make the September 15, 2000 interest
payment due on the Senior Subordinated Notes unless the Company's other
creditors commenced the exercise of remedies, which could include the
acceleration of the Company's debt obligations and an involuntary bankruptcy
filing. The Amendment provided for the immediate permanent termination of $88.0
million of the otherwise available working capital commitments under the Credit
Agreement, and for an additional permanent termination of $4.0 million of those
commitments on each of October 31, 2000, November 30, 2000 and December 31,
2000. The Amendment required that Bowling Worldwide deliver to the lenders under
the Credit Agreement by September 30, 2000 a preliminary plan containing the
principal terms of a proposal to restructure the Company's debt, which plan was
required to be satisfactory to a majority of the lenders by October 15, 2000.
The Company submitted such a proposed restructuring plan during the period
required by the Amendment and a majority of the lenders indicated that the plan
was generally satisfactory in form and substance, subject to further approval of
any definitive plan. Finally, the Amendment waived Bowling Worldwide's
compliance with the financial covenants in the Credit Agreement through December
31, 2000.


                                       5
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


         After  giving  effect to the  commitment  terminations  required by the
Amendment,  Bowling  Worldwide will have an aggregate  available working capital
commitment under the Credit Agreement of $255.0 million.  Based upon the current
level of  performance,  management  believes  that cash  flow  from  operations,
together with available  borrowings under the Credit Agreement and other sources
of  liquidity,  will be adequate to meet Bowling  Worldwide's  normal  operating
expenses and requirements for capital expenditures during the remainder of 2000.
In calendar year 2001, principal payment obligations under the facilities of the
Credit Agreement increase significantly and cash interest becomes payable on the
senior subordinated  discount notes (the "Senior Subordinated  Discount Notes"),
and it is not expected that the Company will be able to make such  principal and
interest payments.

         On September 15, 2000, Bowling Worldwide did not make the required cash
interest payment on the Senior Subordinated Notes, and on October 15, 2000, the
30 day period to cure the non-payment of interest under the related Indenture
expired. Under the Indenture, beginning on October 15, 2000, the Trustee on its
own or the holders of 25% or more of the outstanding principal amount of the
Senior Subordinated Notes have the right, by written notice, to declare all
amounts owed under the Indenture immediately due and payable. If the
indebtedness represented by the Senior Subordinated Notes were to be so
accelerated, such acceleration would result in a default under the Credit
Agreement, Bowling Worldwide's Senior Subordinated Discount Notes, AMF Bowling's
zero coupon convertible debentures (the "Convertible Debentures") and certain
other Company indebtedness. In such event, the Company would not then be able to
meet its accelerated payment obligations. Neither the Company nor Bowling
Worldwide has received notice that any of its indebtedness has been accelerated.

         The Company has retained financial and legal advisors to evaluate and
assist it with its restructuring and refinancing alternatives. The alternatives
include a consensual, negotiated restructuring and/or reduction of the different
classes of the Company's indebtedness to be set forth in a reorganization plan
to be filed under Chapter 11 and other possible methods for reducing the
Company's long term debt and improving its capital structure. Any alternative
selected is likely to have a material adverse effect on the ability of AMF
Bowling's shareholders to recover their investment in AMF Bowling's Common Stock
and on the ability of the holders of the Senior Subordinated Notes, Senior
Subordinated Discount Notes, the Convertible Debentures and other Company
indebtedness to receive interest and principal payments due them.

     The Company and its  advisors  have  provided  certain  information  to and
commenced discussions with the lenders under the Credit Agreement and advisors
to the holders of the Senior Subordinated Notes and Senior Subordinated Discount
Notes. The lenders and those subordinated debt holders have retained their own
separate legal and financial advisors. It appears that discussions with those
groups may continue beyond year end, in which case a further waiver of the
financial covenants under the Credit Agreement will be required. While it is
diligently pursuing a financial restructuring, the Company is unable to predict
when or if it would be able to arrive at a restructuring plan acceptable to its
lenders and other holders of its indebtedness, whether it will be able to
satisfactorily implement such a plan or whether the Company's lenders and
holders of its other classes of indebtedness will not at any point pursue any or
all remedies available to them, including acceleration of the Company's
indebtedness and, in the case of the lenders under the Credit Agreement,
realization on collateral for the indebtedness.

     While the financial covenants in the Credit Agreement have been waived
through December 31, 2000, it appears likely that, unless extended, the waiver
will expire prior to the implementation of a restructuring plan. If a further
waiver is not obtained, Bowling Worldwide will not be able to meet the
reinstated financial covenants or any more stringent covenants that might be
reset at later dates. Bowling Worldwide is also obligated to make a scheduled
principal payment of approximately $12.8 million under the Credit Agreement by
December 31, 2000, which it is unlikely to make, in which case a further
amendment to the Credit Agreement may be required. In current circumstances, the
Company does not expect that it will be able to access new financing, either to
fund its operations or to pay required interest and principal payments prior to
a debt restructuring.

         In connection with its financial restructuring efforts, the Company is
also exploring ways to improve its operations. The focus of these operational
restructuring efforts is to primarily reduce the level of general and
administrative expenses which support the U.S. bowling centers. In addition, the
Company is exploring cost cutting opportunities in its bowling products
business, with a similar focus on reduction of general and administrative
expenses. Potential savings from such cost cutting measures would in part fund a
major new initiative to establish a training school for center managers and key
staff, as well as to fund enhanced incentive compensation and benefits programs
for center personnel to be implemented for 2001.

                                       6
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


         The Company's Board of Directors has approved the implementation of new
bonus, severance and retention programs in order to retain key personnel and
maintain morale during the restructuring. The plans extend to senior management
and bonus-eligible and stock option-eligible personnel, including each center
manager around the world. The bonus programs are conditioned upon continued
employment to a specified date. The Company estimates the aggregate cost of
these bonus programs will approximate $5.4 million.


                                       7
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

     The  Company's  quarterly   consolidated  financial  statements  have  been
prepared on the assumption that the Company will continue as a going concern. If
the Company's long term debt is accelerated or the Company is unable to complete
a refinancing or  restructuring,  the Company might not be able to continue as a
going  concern.   The  Company  has  been  advised  by  its  independent  public
accountants  that if a refinancing or  restructuring of its indebtedness has not
been completed prior to the completion of their audit of the Company's financial
statements  for the year ending  December 31, 2000,  their  auditors'  report on
those financial statements will be modified to reflect this contingency.


Note 2.  Significant Accounting Policies

Basis of Presentation

     The condensed  consolidated  results of operations of the Company have been
presented  for the three  months and nine months  ended  September  30, 2000 and
1999, respectively.  All significant intercompany balances and transactions have
been eliminated in the accompanying condensed consolidated financial statements.
All dollar amounts are in thousands, except where otherwise indicated.

Goodwill

     As a result of the Acquisition and subsequent purchases of bowling centers,
and in  accordance  with  the  purchase  method  of  accounting  used in all the
Company's acquisitions, the Company recorded goodwill representing the excess of
the purchase price over the allocation among the acquired assets and liabilities
in accordance  with estimates of fair market value on the dates of  acquisition.
Goodwill  is being  amortized  over 40 years.  Amortization  expense  related to
goodwill  was $5,253 and  $15,661  for the three  months and nine  months  ended
September 30, 2000,  and $5,130 and $15,404 for the three months and nine months
ended September 30, 1999.


                                       8
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Income Taxes

         As of  September  30,  2000,  the Company had net  operating  losses of
approximately  $263.6 million and foreign tax credits of $11.5 million that will
carry over to future years to offset U.S. income taxes.  The foreign tax credits
will begin to expire in the fiscal year 2001 and the net  operating  losses will
begin to expire in the fiscal year 2011.  The  Company has  recorded a valuation
reserve,  as of December 31, 1999, for $113.0  million  related to net operating
losses,  foreign tax credits and other  deferred tax assets that the Company may
not utilize prior to their expirations.  The tax provision recorded for the nine
months ended September 30, 2000 primarily reflects certain international taxes.

Comprehensive Loss

     Comprehensive  loss was $62,165 and  $133,727 for the three months and nine
months ended  September 30, 2000,  and $42,811 and $114,932 for the three months
and nine months  ended  September  30,  1999,  respectively.  Accumulated  other
comprehensive  loss consists of the foreign currency  translation  adjustment on
the accompanying condensed consolidated balance sheets.

Net Loss Per Share

     Basic and  diluted  net loss per share is  calculated  based on the  actual
weighted-average shares outstanding.  Outstanding stock options and warrants are
not considered as their effect is antidilutive.

Recent Accounting Pronouncement

     Effective  for the  quarter  ended  March 31,  2001,  the  Company  will be
required  to adopt SFAS No.  133  "Accounting  for  Derivative  Instruments  and
Hedging  Activities." The Company does not expect that adoption of this standard
will have a material  adverse  impact on the  Company's  financial  position  or
results of operations.


Note 3.   Inventories

     Inventories  at September 30, 2000 and December 31, 1999,  consisted of the
following:

                                           September 30,     December 31,
                                               2000             1999
                                         ----------------- ----------------
                                           (unaudited)
Bowling Products, at FIFO:
Raw materials                                    $ 15,186         $ 14,285
Work in progress                                    1,496            1,562
Finished goods and spare parts                     44,766           28,789

Bowling Centers, at average cost:
Merchandise and spare parts                         8,686            8,863
                                         ----------------- ----------------
                                                 $ 70,134         $ 53,499
                                         ================= ================


                                       9
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Note 4.   Property and Equipment

     Property  and  equipment  at  September  30, 2000 and  December  31,  1999,
consisted of the following:

                                                 September 30,   December 31,
                                                     2000            1999
                                                -------------------------------
                                                  (unaudited)
Land                                                  $ 132,592      $ 133,953
Buildings and improvements                              365,265        357,365
Equipment, furniture and fixtures                       605,247        588,342
Other                                                     7,485          5,537
                                                -------------------------------
                                                      1,110,589      1,085,197
Less: accumulated depreciation and amortization        (346,384)      (278,772)
                                                -------------------------------
                                                      $ 764,205      $ 806,425
                                                ===============================



     Depreciation and amortization expense related to property and equipment was
$25,654 and $76,779 for the three  months and nine months  ended  September  30,
2000 and  $24,838  and  $73,536  for the  three  months  and nine  months  ended
September 30, 1999, respectively.


Note 5. Long-Term Debt

     Long-term debt at September 30, 2000,  and December 31, 1999,  consisted of
the following:

                                               September 30,    December 31,
                                                   2000             1999
                                              ---------------- ----------------
                                                (unaudited)
Bank debt                                         $   615,093      $   556,499
Subsidiary senior subordinated notes                  250,000          250,000
Subsidiary senior subordinated discount notes         262,349          240,111
Zero coupon convertible debentures                    181,749          172,630
Mortgage and equipment note                             1,993            1,992
                                              ---------------- ----------------
     Total debt                                     1,311,184        1,221,232
Current maturities (a)                                (53,750)         (34,250)
Long-term debt classified as current (b)           (1,257,434)               -
                                              ---------------- ----------------
     Total long-term debt                         $         -      $ 1,186,982
                                              ================ ================

--------------------
(a)  Current maturities reflect scheduled  principal payments due in the next 12
     months on the Term Facilities.
(b)  Amounts  that  would be due in the next 12  months if  acceleration  of the
     Company's  debt  obligations  occurs  as  described  below  and in "Note 1.
     Organization and Restructuring".


     Bowling  Worldwide's  bank debt (the "Bank  Debt") is  governed by a credit
agreement  (the "Credit  Agreement")  to which  Bowling  Worldwide is party with
Goldman Sachs, its affiliate Goldman Sachs Credit Partners, L.P., Citibank, N.A.
("Citibank") and its affiliates Citicorp Securities, Inc. and Citicorp USA, Inc.
and certain  other  banks,  financial  institutions  and  institutional  lenders
(collectively,  the  "Lenders")  and provides  for (i) senior  secured term loan
facilities  aggregating $365.1 million (the "Term Facilities") and (ii) the Bank
Facility of up to $267.0 million (together with the Term Facilities, the "Senior
Facilities").  In connection with such financing, Goldman Sachs Credit Partners,
L.P.  acted as  Syndication  Agent,  Goldman  Sachs  Credit  Partners,  L.P. and
Citicorp  Securities,  Inc.  acted as  Arrangers,  and  Citibank  is  acting  as
Administrative  Agent. The initial  borrowings under a predecessor of the Credit
Agreement were used to partially fund the Acquisition. As of September 30, 2000,
Bowling  Worldwide  had $12.5 million  available  for  borrowing  under the Bank
Facility,  with  $250.0  million  outstanding  and $4.5  million of standby  and
documentary letters of credit.


                                       10
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

     On June 14, 1999, the lenders under the Credit Agreement approved Amendment
No. 2 and Waiver to the Credit Agreement and entered into the Fourth Amended and
Restated Credit Agreement. The provisions of the Fourth Amended and Restated
Credit Agreement, among other things, permitted Bowling Worldwide to resume
borrowing to fund acquisitions subject to certain criteria and maintenance of
minimum availability under the Bank Facility of $65.0 million through 2000 and
$40.0 million through 2001, and permitted AMF Bowling to make equity
contributions to Bowling Worldwide to be included in the calculation of EBITDA
for financial covenant purposes under the Credit Agreement up to an aggregate of
$10.0 million during any four consecutive quarters through December 31, 2001 (of
which $8.0 million of contributions have been made through September 30, 2000).

         In August, 2000, Bowling Worldwide and the lenders under the Credit
Agreement entered into the Amendment to the Credit Agreement pursuant to which
compliance with all financial covenants was waived through December 31, 2000 and
the revolving credit facility will be reduced to $255.0 million by year-end. As
part of the Amendment, Bowling Worldwide did not make the September 15, 2000
interest payment due on its Senior Subordinated Notes and the lenders under the
Credit Agreement agreed to waive any default under the Credit Agreement
resulting from such non-payment unless the Company's other creditors commence
the exercise of remedies, which include the acceleration of the Company's debt
obligations. Failure to make such payment within 30 days of its due date
resulted in a default under the Senior Subordinated Notes. Such default could
result in the acceleration of the obligations under such Senior Subordinated
Notes and substantially all of the Company's other indebtedness. See "Note 1.
Organization and Restructuring" in the Notes to Condensed Consolidated Financial
Statements. Without the waiver included in the Amendment, Bowling Worldwide
would not have met its financial covenants in the Credit Agreement at September
30, 2000.

Nonrecurring Restructuring Charges and Special Charges

     During  the  third  quarter  of 1999,  the  Company  recorded  nonrecurring
restructuring  charges of approximately $7.5 million that were related primarily
to a plan to reorganize and downsize the Bowling  Products  business in response
to market  weakness in the Asia Pacific region and increased  competition  which
negatively impacted sales and profitability of new center packages ("NCPs" which
include all the equipment  necessary to outfit a new bowling center or expand an
existing bowling center).  The  restructuring  plan was developed in conjunction
with a strategic business assessment performed by Bain & Co. and was designed to
reduce the overall  volatility of the Bowling Products  business.  Actions taken
included closing one plant in the U.S., and one plant in Korea, three warehouses
in China,  one  warehouse in Taiwan,  four sales  offices in China and one sales
office in Belgium.  Additionally,  sales  offices  were  downsized in four other
countries.  The restructuring  charges related primarily to employee termination
benefits, asset write-offs and contract cancellations.

     In addition, the strategic assessment by Bain & Co. led to programs
designed to improve product line profitability and quality. This assessment was
a catalyst to the Company recording certain charges. These charges, along with
additional reserves (collectively, the "Special Charges") recorded by the
Company totaled $27.5 million for the period ended September 30, 1999. The
Special Charges are non-cash, relate primarily to receivables and inventory and
are included within operating expenses.


                                       11
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The  following  table  summarizes  the nature of the  restructuring  charges and
Special Charges taken in the third quarter of 1999:

                                Bowling      Bowling      Bowling
                                Centers      Products    Corporate      Total
                             ------------ ------------ ------------ -----------
Restructuring charges                0.2          7.2          0.1          7.5
Special charges                      6.6         20.7          0.2         27.5
                             ------------ ------------ ------------ ------------

        Total charges              $ 6.8       $ 27.9        $ 0.3       $ 35.0
                             ============ ============ ============ ============


Note 6.  Commitments and Contingencies

Litigation and Claims

     On April 22, 1999, a putative  class action was filed in the United  States
District  Court for the  Southern  District of New York by Vulcan  International
Corporation against AMF Bowling, The Goldman Sachs Group, L.P., Goldman, Sachs &
Co., Morgan Stanley & Co. Incorporated,  Cowen & Company,  Schroder & Co., Inc.,
Richard A. Friedman and Douglas J. Stanard.  The complaint has subsequently been
amended  to,  among other  things,  include  additional  named  plaintiffs.  The
plaintiffs,  as putative  class  representatives  for all persons who  purchased
Common  Stock in the  Company's  initial  public  offering of Common  Stock (the
"Initial  Public  Offering")  or  within  25 days of the  effective  date of the
registration statement related to the Initial Public Offering, seek, among other
things,  damages and/or rescission  against all defendants jointly and severally
pursuant to  Sections  11, 12 and/or 15 of the  Securities  Act of 1933 based on
allegedly inaccurate and misleading disclosures in connection with and following
the Initial Public Offering.  Management believes that the litigation is without
merit and intends to defend it vigorously.

     In June 1998,  Harbin Hai Heng Bowling  Entertainment Co. Ltd. ("Hai Heng")
filed an  action  against  AMF  Bowling  Products,  Inc.  ("AMF"),  an  indirect
subsidiary  of AMF  Bowling,  in  the  Harbin  Intermediate  People's  Court  in
Heilongjing,  China.  Hai Heng  sought to  recover  $3 to $4  million in damages
relating to 38 NCPs  purchased from AMF. Hai Heng asserted that the poor quality
of the 38 NCPs  entitled Hai Heng to recover the purchase  price and damages for
lost profits and the cost of storing the NCPs.

     On November 6, 1998, the court awarded Hai Heng approximately $3.5 million.
AMF appealed the award to the High People's Court of Heilongjing Province (the
"People's Court"). Prior to completion of the appeal review, the President of
the People's Court on February 11, 1999 issued a judgment in favor of Hai Heng
for approximately $2.8 million and ordered Hai Heng to return 24 NCPs to AMF.
AMF filed an appeal to the Supreme People's Court in Beijing (the "Supreme
Court"). The Supreme Court orally issued a stay of the execution of the
judgment. AMF has been advised that the Supreme Court has declined to review the
case and the judgment is now final.

     On September 21, 2000, the United States Securities and Exchange Commission
("SEC") issued a subpoena to the Company seeking documents concerning the
Company's financial statements and accounting practices and policies. The
Company is in the process of producing documents to the SEC in response to the
subpoena. The Company does not believe at this time that this inquiry by the SEC
will have a material adverse effect on the Company or its financial statements.

     In  addition,  the Company is involved in certain  lawsuits  arising out of
normal business operations. The majority of these relate to accidents at bowling
centers.  Management  believes that the ultimate resolution of such matters will
not have a material  adverse  effect on the  Company's  results of operations or
financial  position.  While the ultimate  outcome of the  litigation  and claims
against the Company  cannot  presently be  determined,  management  believes the
Company has made adequate provision for possible losses.


                                       12
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Note 7.  Business Segments

The Company operates in two major lines of business:  operating  bowling centers
and  manufacturing   bowling  and  related  products.   Information   concerning
operations in these businesses for the three months ended September 30, 2000 and
1999, respectively, is presented below (in millions):

<TABLE>
<CAPTION>
                                                            Three Months Ended September 30, 2000
                                    --------------------------------------------------------------------------------------------

                                           Bowling Centers                Bowling Products
                                    -------------------------------- --------------------------
                                               Inter-      Sub-               Inter-     Sub-                  Elim-
                                      U.S.    national    total       U.S.   national   total     Corporate   inations    Total
                                      ----    --------    -----       ----   --------   -----     ---------   --------    -----
<S>                                 <C>       <C>       <C>         <C>      <C>       <C>            <C>       <C>     <C>
Revenue from unaffiliated customers $ 98.8    $ 27.8    $ 126.6     $18.5    $17.0     $ 35.5         $ -       $ -     $ 162.1
Intersegment sales                       -         -          -       5.4      1.1        6.5           -      (6.5)          -
Operating income (loss)              (10.1)      2.0       (8.1)     (2.6)    (1.2)      (3.8)       (8.5)      0.4       (20.0)
Identifiable assets                  784.3     294.2    1,078.5     604.8     70.4      675.2        17.8       4.5     1,776.0
Depreciation and amortization         22.0       5.3       27.3       5.8      0.3        6.1         0.4      (0.4)       33.4
Capital expenditures                  11.6       2.4       14.0       2.3      0.1        2.4         0.4         -        16.8
Research and development expense         -         -          -       0.1        -        0.1           -         -         0.1

<CAPTION>
                                                            Three Months Ended September 30, 1999
                                    --------------------------------------------------------------------------------------------

                                           Bowling Centers                Bowling Products
                                    -------------------------------- --------------------------
                                               Inter-      Sub-               Inter-     Sub-                  Elim-
                                      U.S.    national    total       U.S.   national   total     Corporate   inations    Total
                                      ----    --------    -----       ----   --------   -----     ---------   --------    -----
Revenue from unaffiliated customers $ 94.9    $ 31.0    $ 125.9     $28.4    $28.5     $ 56.9         $ -       $ -     $ 182.8
Intersegment sales                       -         -          -       2.4      1.4        3.8           -      (3.8)          -
Operating income (loss)              (18.3)     (2.3)     (20.6)    (27.3)    (1.4)     (28.7)       (6.6)      0.3       (55.6)
Identifiable assets                  831.2     326.1    1,157.3     608.1     76.5      684.6        29.8       3.1     1,874.8
Depreciation and amortization         21.1      10.7       31.8       5.5      0.4        5.9         0.4      (0.5)       37.6
Capital expenditures                  10.0       2.2       12.2       1.4      0.1        1.5           -         -        13.7
Research and development expense         -         -          -         -        -          -           -         -           -
</TABLE>




                                       13
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

     Information  concerning  operations in these businesses for the nine months
ended  September  30,  2000  and  1999  respectively,  is  presented  below  (in
millions):

<TABLE>
<CAPTION>
                                                            Nine Months Ended September 30, 2000
                                    --------------------------------------------------------------------------------------------

                                           Bowling Centers                Bowling Products
                                    -------------------------------- --------------------------
                                                Inter-      Sub-               Inter-     Sub-                  Elim-
                                       U.S.    national    total       U.S.   national   total     Corporate   inations    Total
                                       ----    --------    -----       ----   --------   -----     ---------   --------    -----
Revenue from unaffiliated customers $ 339.5    $ 88.4    $ 427.9     $53.1    $51.3    $ 104.4         $ -       $ -     $ 532.3
Intersegment sales                        -         -          -      11.4      3.1       14.5           -     (14.5)          -
Operating income (loss)                 7.6       7.7       15.3      (8.7)    (1.8)     (10.5)      (19.8)      1.1       (13.9)
Identifiable assets                   784.3     294.2    1,078.5     604.8     70.4      675.2        17.8       4.5     1,776.0
Depreciation and amortization          65.9      16.5       82.4      17.3      0.8       18.1         1.4      (1.3)      100.6
Capital expenditures                   33.5       7.7       41.2       7.0      0.2        7.2         1.1         -        49.5
Research and development expense          -         -          -       0.2        -        0.2           -         -         0.2
<CAPTION>
                                                            Nine Months Ended September 30, 1999
                                    --------------------------------------------------------------------------------------------

                                           Bowling Centers                Bowling Products
                                    -------------------------------- --------------------------
                                                Inter-      Sub-               Inter-     Sub-                  Elim-
                                       U.S.    national    total       U.S.   national   total     Corporate   inations    Total
                                       ----    --------    -----       ----   --------   -----     ---------   --------    -----
<S>                                 <C>        <C>       <C>         <C>      <C>      <C>         <C>         <C>       <C>
Revenue from unaffiliated customers $ 333.6    $ 94.2    $ 427.8     $56.6    $62.1    $ 118.7         $ -       $ -     $ 546.5
Intersegment sales                        -         -          -       9.8      3.1       12.9           -     (12.9)          -
Operating income (loss)                 4.6       4.2        8.8     (34.6)    (6.4)     (41.0)      (18.9)      1.0       (50.1)
Identifiable assets                   831.2     326.1    1,157.3     608.1     76.5      684.6        29.8       3.1     1,874.8
Depreciation and amortization          63.5      22.4       85.9      16.5      1.1       17.6         1.8      (1.3)      104.0
Capital expenditures                   25.7       4.8       30.5       4.2      0.3        4.5           -         -        35.0
Research and development expense          -         -          -       0.1        -        0.1           -         -         0.1
</TABLE>



Note 8.  Condensed Consolidating Financial Statements

     Bowling  Worldwide's  subsidiary senior  subordinated  notes and subsidiary
senior  subordinated  discount  notes are jointly and severally  guaranteed on a
full and unconditional basis by AMF Group Holdings and the first and second-tier
subsidiaries of Bowling Worldwide (the "Guarantor  Companies").  AMF Bowling and
the  third-tier  and  lower-tier  subsidiaries  of  Bowling  Worldwide  have not
provided guarantees of such indebtedness (the "Non-Guarantor Companies").

     The following condensed  consolidating  financial information presents: (i)
the  condensed  consolidating  balance sheet for the  Guarantor  Companies,  the
Non-Guarantor  Companies and the Company as of September 30, 2000, and condensed
consolidating  statements of income and cash flows for the Guarantor  Companies,
the Non-Guarantor  Companies and the Company for the nine months ended September
30,  2000 and  (ii)  elimination  entries  necessary  to  combine  the  entities
comprising the Company.



                                       14
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

                       AMF BOWLING, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATING BALANCE SHEET
                            As of September 30, 2000
                                   (unaudited)
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                   Non-
                                                     Guarantor     Guarantor
                                                     Companies     Companies  Eliminations  Consolidated
                                                     ---------     ---------  ------------  ------------
<S>                                                   <C>          <C>               <C>       <C>
    Assets
   Current assets:
    Cash and cash equivalents                    $    19,040    $    10,340    $       -      $    29,380
    Accounts and notes receivable, net
       of allowance for doubtful accounts             68,866            327            -           69,193
    Accounts receivable - intercompany                14,327         12,528        (26,855)           -
    Inventories                                       68,783          1,351            -           70,134
    Other current assets                              10,611          5,373            -           15,984
                                                 -----------    -----------    -----------    -----------
    Total current assets                             181,627         29,919        (26,855)       184,691
   Notes receivable - intercompany                    49,444          5,663        (55,107)           -
   Property and equipment, net                       712,867         49,946          1,392        764,205
   Investment in subsidiaries                         13,987        523,606       (537,593)           -
   Goodwill and other assets                         803,176         23,932            -          827,108
                                                 -----------    -----------    -----------    -----------
    Total assets                                 $ 1,761,101    $   633,066    $  (618,163)   $ 1,776,004
                                                 -----------    -----------    -----------    -----------
    Liabilities and Stockholders' Equity
   Current liabilities:
    Accounts payable                             $    22,053    $     1,643    $        35    $    23,731
    Accounts payable - intercompany                   12,528         14,327        (26,855)           -
    Accrued expenses                                  69,712          8,286            -           77,998
    Income taxes payable                              (3,439)         5,525            -            2,086
    Current portion of long-term debt                 53,750              -            -           53,750
    Long-term debt classified as current           1,058,682        198,752            -        1,257,434
                                                 -----------    -----------    -----------    -----------
    Total current liabilities                      1,213,286        228,533        (26,820)     1,414,999
   Notes payable - intercompany                        5,663         49,444        (55,107)           -
   Other long-term liabilities                         4,559            400            -            4,959
                                                 -----------    -----------    -----------    -----------
    Total liabilities                              1,223,508        278,377        (81,927)     1,419,958
                                                 -----------    -----------    -----------    -----------
   Commitments and contingencies
   Stockholders' equity:
    Common stock                                         -              836            -              836
    Paid-in capital                                1,054,683        903,473     (1,052,709)       905,447
    Retained deficit                                (486,907)      (519,437)       486,290       (520,054)
    Accumulated other comprehensive loss             (30,183)       (30,183)        30,183        (30,183)
                                                 -----------    -----------    -----------    -----------
    Total stockholders' equity                       537,593        354,689       (536,236)       356,046
                                                 -----------    -----------    -----------    -----------

    Total liabilities and stockholders' equity   $ 1,761,101    $   633,066    $  (618,163)   $ 1,776,004
                                                 ===========    ===========    ===========    ===========
</TABLE>


                                       15
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

                       AMF BOWLING, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
                  For the Nine Months Ended September 30, 2000
                                   (unaudited)
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                    Non-
                                                      Guarantor   Guarantor
                                                      Companies   Companies   Eliminations Consolidated
                                                     ---------    ---------   -----------  ------------
<S>                                                    <C>             <C>          <C>            <C>
    Operating revenue                                $ 489,874    $  43,508    $  (1,095)   $ 532,287
                                                     ---------    ---------    ---------    ---------

    Operating expenses:
     Cost of goods sold                                114,325        4,809         (733)     118,401
     Bowling center operating expenses                 257,391       23,577         (360)     280,608
     Selling, general, and administrative expenses      35,968        8,415          -         44,383
     Refinancing charges                                 2,244          -            -          2,244
     Depreciation and amortization                      93,385        7,269          (92)     100,562
                                                     ---------    ---------    ---------    ---------
     Total operating expenses                          503,313       44,070       (1,185)     546,198
                                                     ---------    ---------    ---------    ---------

    Operating income                                   (13,439)        (562)          90      (13,911)
                                                     ---------    ---------    ---------    ---------

    Nonoperating expenses (income):
     Interest expense                                   88,491       10,301          -         98,792
     Other expenses, net                                 3,163          840          -          4,003
     Interest income                                    (1,568)         (27)         -         (1,595)
     Equity in loss (income) of subsidiaries            (2,153)     106,318     (104,165)         -
                                                     ---------    ---------    ---------    ---------
    Total nonoperating expenses                         87,933      117,432     (104,165)     101,200
                                                     ---------    ---------    ---------    ---------

    Loss before income taxes                          (101,372)    (117,994)     104,255     (115,111)
    Provision for income taxes                           2,072          964          -          3,036
                                                     ---------    ---------    ---------    ---------

    Net loss before equity in loss of
     joint ventures and extraordinary item            (103,444)    (118,958)     104,255     (118,147)
    Equity in loss of joint ventures                      (721)         -            -           (721)
                                                     ---------    ---------    ---------    ---------
    Net loss                                         $(104,165)   $(118,958)   $ 104,255    $(118,868)
                                                     =========    =========    =========    =========
</TABLE>


                                       16
<PAGE>

                       AMF BOWLING, INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

                       AMF BOWLING, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
                  For the Nine Months Ended September 30, 2000
                                   (unaudited)
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                   Non-
                                                                  Guarantor     Guarantor
                                                                  Companies     Companies  Eliminations  Consolidated
                                                                  ---------     ---------  ------------  ------------
<S>                                                                 <C>           <C>           <C>          <C>
 Cash flows from operating activities:
  Net loss                                                        $(104,165)   $(118,958)   $ 104,255    $(118,868)
  Adjustments to reconcile net loss to net
   cash provided by (used in) operating activities:
   Depreciation and amortization                                     93,385        7,269          (92)     100,562
   Equity in loss of joint ventures                                     721          -            -            721
   Amortization of bond discount                                     22,240        9,119          -         31,359
   Equity in (loss) income of subsidiaries                           (2,153)     106,318     (104,165)         -
   (Gain) Loss on the sale of property and equipment, net             1,920       (1,715)         -            205
   Changes in assets and liabilities:
    Accounts and notes receivable                                    (9,829)          22          -         (9,807)
    Receivables and payables - affiliates                            (4,375)       4,375          -            -
    Inventories                                                     (18,342)        (357)         -        (18,699)
    Other assets                                                     10,558         (210)         -         10,348
    Accounts payable and accrued expenses                            (2,375)        (722)         -         (3,097)
    Income taxes payable                                             (1,491)         753          -           (738)
    Other long-term liabilities                                      (3,862)         -            -         (3,862)
                                                                  ---------    ---------    ---------    ---------
   Net cash provided by (used in) operating activities              (17,768)       5,894           (2)     (11,876)
                                                                  ---------    ---------    ---------    ---------

 Cash flows from investing activities:
  Acquisitions of operating units, net of cash acquired              (5,350)         -            -         (5,350)
  Investment in subsidiary                                              -         (7,000)       7,000          -
  Purchases of property and equipment                               (45,280)      (4,219)           2      (49,497)
  Proceeds from sale of property and equipment                          688        2,657          -          3,345
                                                                  ---------    ---------    ---------    ---------
   Net cash used in investing activities                            (49,942)      (8,562)       7,002      (51,502)
                                                                  ---------    ---------    ---------    ---------

 Cash flows from financing activities:
  Proceeds from long-term debt, net of deferred financing costs      85,000          -            -         85,000
  Payments on long-term debt                                        (26,407)         -            -        (26,407)
  Rights offering costs                                                 -           (163)         -           (163)
  Capital contribution from Parent                                    7,000          -         (7,000)         -
  Payments of noncompete obligations                                   (196)         -            -           (196)
                                                                  ---------    ---------    ---------    ---------
   Net cash provided by (used in) financing activities               65,397         (163)      (7,000)      58,234
                                                                  ---------    ---------    ---------    ---------
   Effect of exchange rates on cash                                   2,721       (3,940)         -         (1,219)
                                                                  ---------    ---------    ---------    ---------

   Net decrease in cash                                                 408       (6,771)         -         (6,363)
   Cash and cash equivalents at beginning of period                  18,632       17,111          -         35,743
                                                                  ---------    ---------    ---------    ---------
   Cash and cash equivalents at end of period                     $  19,040    $  10,340        $ -      $  29,380
                                                                  =========    =========    =========    =========
</TABLE>


                                       17
<PAGE>

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

         Certain matters discussed in this report contain forward-looking
statements, which are statements other than historical information or statements
of current condition. Statements set forth in this report or statements
incorporated by reference from documents filed with the Securities and Exchange
Commission are or may be forward-looking statements, including possible or
assumed future results of the operations of AMF Bowling, Inc. ("AMF Bowling")
and its subsidiaries (collectively, the "Company"), including but not limited to
any statements contained in this report concerning: (i) timing, execution and
results of the Company's restructuring or refinancing process, (ii) the results
of the Company's plans to improve its bowling centers operations, including
revenue enhancement and cost management programs, (iii) the ability of the
Company's management to execute its strategies, (iv) the timing or amount of any
changes in the interest expense and/or principal repayment obligations of the
Company's indebtedness, including the timing of any acceleration of the
Company's indebtedness, and the timing of the pursuit of any remedies by the
Company's creditors (v) the Company's ability to generate cash flow to service
its indebtedness and meet its debt payment obligations, (vi) the results of
operations and initiatives engaged in with respect to the Company's bowling
products and bowling centers businesses, (vii) the results of the Company's
employee incentive and retention efforts, (viii) the outcome of existing or
potential litigation, (ix) the amounts of capital expenditures needed to
maintain or improve the Company's bowling centers, (x) any statements preceded
by, followed by or including the words "believes," "expects," "predicts,"
"anticipates," "intends," estimates," "should," "may" or similar expressions and
(xi) other statements contained or incorporated in this report regarding matters
that are not historical facts.

     These forward-looking  statements relate to the plans and objectives of the
Company or future operations.  In light of the risks and uncertainties  inherent
in all future projections and the Company's financial position, the inclusion of
forward-looking   statements  in  this  report  should  not  be  regarded  as  a
representation  by AMF Bowling that the  objectives or plans of the Company will
be achieved.  Many factors  could cause the Company's  actual  results to differ
materially from those in the forward-looking statements,  including: (i) timing,
execution and results of the Company's  restructuring  or  refinancing  process,
(ii) the Company's ability, and the ability of its management team, to carry out
the Company's business strategies, (iii) the Company's ability to avoid the
acceleration of its long term indebtedness, the resulting cross default under
such indebtedness and any resulting enforcement of remedies relating to such
default, including the foreclosure by the lenders under the Credit Agreement on
collateral for their indebtedness and the filing of an involuntary bankruptcy
petition, (iv) the Company's ability to integrate acquired operations into its
business, (v) the Company's ability to sell to existing bowling markets and
identify and participate in sales to new bowling markets in light of the current
uncertainty surrounding the Company's financial position, (vi) the continuation
of adverse financial results and substantial competition in the Company's
bowling products business, (vii) the Company's ability to retain and attract
experienced bowling center management and other key management personnel, (viii)
the Company's ability to successfully implement initiatives designed to improve
and retain customer traffic in its bowling centers, (ix) the Company's ability
to attract and retain league bowlers in its bowling centers and customers in its
Bowling Products business, (x) the risk of adverse political acts or
developments in the Company's existing and proposed international markets, (xi)
fluctuations in foreign currency exchange rates affecting the Company's
translation of operating results, (xii) continued or increased competition,
(xiii) the popularity of bowling, (xiv) the decline in general economic
conditions, (xv) adverse judgments in pending or future litigation, (xvi) the
Company's ability to effectively implement the amended joint distribution and
related arrangements with Zhonglu and effectively sell products in the China
markets and (xvii) changes in interest and exchange rates.

         The foregoing  review of important  factors  should not be construed as
exhaustive and should be read in conjunction  with other  cautionary  statements
that are included elsewhere in this report. AMF Bowling undertakes no obligation
to  release  publicly  the  results  of any  future  revisions  it may  make  to
forward-looking  statements to reflect  events or  circumstances  after the date
hereof or to reflect the occurrence of unanticipated events.

         On August 14, 2000,  Bowling  Worldwide  announced  that it had entered
into an amendment (the "Amendment") to its Credit  Agreement,  that it would not
make the  interest  payment due  September  15, 2000 on its senior  subordinated
notes  (the  "Senior  Subordinated  Notes")  and that it would  begin  exploring
various  alternatives  to restructure  and reduce its long-term debt. As part of
the Amendment, the lenders agreed to waive any default under the Credit
Agreement resulting from the failure to make the September 15, 2000 interest
payment due on the Senior Subordinated Notes unless the Company's other
creditors commenced the exercise of remedies, which could include the
acceleration of the Company's debt obligations and an involuntary bankruptcy
filing. The Amendment provided for the immediate permanent termination of $88.0
million of the otherwise available working capital commitments under the Credit
Agreement, and for an additional permanent termination of $4.0 million of those
commitments on each of October 31, 2000, November 30, 2000 and December 31,
2000. The Amendment required that Bowling Worldwide deliver to the lenders under
the Credit Agreement by September


                                       18
<PAGE>

30, 2000 a preliminary  plan  containing  the  principal  terms of a proposal to
restructure the Company's debt,  which plan was required to be satisfactory to a
majority of the  lenders by October  15,  2000.  The  Company  submitted  such a
proposed  restructuring  plan during the period  required by the Amendment and a
majority of the lenders  indicated that the plan was generally  satisfactory  in
form and substance, subject to further approval of any definitive plan. Finally,
the Amendment waived Bowling Worldwide's compliance with the financial covenants
in the Credit Agreement through December 31, 2000.

         After  giving  effect to the  commitment  terminations  required by the
Amendment,  Bowling  Worldwide will have an aggregate  available working capital
commitment under the Credit Agreement of $255.0 million.  Based upon the current
level of  performance,  management  believes  that cash  flow  from  operations,
together with available  borrowings under the Credit Agreement and other sources
of  liquidity,  will be adequate to meet Bowling  Worldwide's  normal  operating
expenses and requirements for capital expenditures during the remainder of 2000.
In calendar year 2001, principal payment obligations under the facilities of the
Credit Agreement increase significantly and cash interest becomes payable on the
senior subordinated  discount notes (the "Senior Subordinated  Discount Notes"),
and it is not expected that the Company will be able to make such  principal and
interest payments.

         On September 15, 2000, Bowling Worldwide did not make the required cash
interest payment on the Senior Subordinated Notes, and on October 15, 2000, the
30 day period to cure the non-payment of interest under the related Indenture
expired. Under the Indenture, beginning on October 15, 2000, the Trustee on its
own or the holders of 25% or more of the outstanding principal amount of the
Senior Subordinated Notes have the right, by written notice, to declare all
amounts owed under the Indenture immediately due and payable. If the
indebtedness represented by the Senior Subordinated Notes were to be so
accelerated, such acceleration would result in a default under the Credit
Agreement, Bowling Worldwide's Senior Subordinated Discount Notes, AMF Bowling's
zero coupon convertible debentures (the "Convertible Debentures") and certain
other Company indebtedness. In such event, the Company would not then be able to
meet its accelerated payment obligations. Neither the Company nor Bowling
Worldwide has received notice that any of its indebtedness has been accelerated.

         The Company has retained financial and legal advisors to evaluate and
assist it with its restructuring and refinancing alternatives. The alternatives
would include a consensual, negotiated restructuring and/or reduction of the
different classes of the Company's indebtedness to be set forth in a
reorganization plan to be filed under Chapter 11 and other possible methods for
reducing the Company's long term debt and improving its capital structure. Any
alternative selected is likely to have a material adverse effect on the ability
of AMF Bowling's shareholders to recover their investment in AMF Bowling's
Common Stock and on the ability of the holders of the Senior Subordinated Notes,
Senior Subordinated Discount Notes, the Convertible Debentures and other Company
indebtedness to receive interest and principal payments due them.

     The Company and its advisors have provided certain information to and
commenced discussions with the lenders under the Credit Agreement and advisers
to the holders of the Senior Subordinated Notes and Senior Subordinated Discount
Notes. The lenders and those subordinated debt holders have retained their own
separate legal and financial advisors. It appears that discussions with those
groups may continue beyond year end, in which case a further waiver of the
financial covenants under the Credit Agreement will be required. While it is
diligently pursuing a financial restructuring, the Company is unable to predict
when or if it would be able to arrive at a restructuring plan acceptable to its
lenders and other holders of its indebtedness, whether it will be able to
satisfactorily implement such a plan or whether the Company's lenders and
holders of its other classes of indebtedness will not at any point pursue any or
all remedies available to them, including acceleration of the Company's
indebtedness and, in the case of the lenders under the Credit Agreement,
realization on collateral for the indebtedness.

     While the  financial  covenants  in the Credit  Agreement  have been waived
through December 31, 2000, it appears likely that, unless extended, the waiver
will expire prior to the implementation of a restructuring plan. If a further
waiver is not obtained, Bowling Worldwide will not be able to meet the
reinstated financial covenants or any more stringent covenants that may be reset
at later dates. Bowling Worldwide is also obligated to make a scheduled
principal payment of approximately $12.8 million under the Credit Agreement by
December 31, 2000, which it is unlikely to make, in which case a further
amendment to the Credit Agreement may be required. In current circumstances, the
Company does not expect that it will be able to access new financing, either to
fund its operations or to pay required interest and principal payments prior to
a debt restructuring.

         In connection with its financial  restructuring efforts, the Company is
also exploring ways to improve its operations. The focus of these operational
restructuring efforts is to primarily reduce the level of general and
administrative expenses which support the U.S. bowling centers. In addition, the
Company is exploring cost cutting opportunities in its bowling products
business, with a similar focus on reduction of general and administrative


                                       19
<PAGE>

expenses. Potential savings from such cost cutting measures would in part fund a
major new initiative to establish a training  school for center managers and key
staff, as well as to fund enhanced incentive  compensation and benefits programs
for center personnel to be implemented for 2001.

    The  Company's  Board of Directors  has approved the  implementation  of new
bonus,  severance and retention  programs in order to maintain morale during the
restructuring.  The plans extend to senior management,  bonus-eligible and stock
option-eligible  personnel,  including each center manager around the world. The
bonus programs are  conditioned  upon continued  employment to a specified date.
The  Company   estimates  the  aggregate  cost  of  these  bonus  programs  will
approximate $5.4 million.

Background

     This discussion should be read in conjunction with the information
contained under "Selected Financial Data" and AMF Bowling's Condensed
Consolidated Financial Statements (unaudited) and the notes thereto included
elsewhere herein. See also "Note 1. Organization and Restructuring" in the Notes
to the Condensed Consolidated Financial Statements.

     The financial  information presented below includes the Company's operating
results  expressed  in terms of EBITDA,  which  represents  earnings  before net
interest expense,  income taxes,  depreciation and  amortization,  and other net
income or net  expenses.  EBITDA  information  is  included  because the Company
understands that such information is used by certain investors as one measure of
a  company's  historical  ability to service  debt.  EBITDA is not  intended  to
represent and should not be considered more  meaningful  than, or an alternative
to, other measures of performance  determined in accordance with U.S.  generally
accepted accounting principles.

General

     The Company  principally  operates in two  business  segments in the United
States and  international  markets:  (i) the ownership and operation of 408 U.S.
bowling  centers and 119  international  bowling  centers  ("Bowling  Centers"),
including 15 joint venture centers operated with third parties,  as of September
30, 2000,  and (ii) the  manufacture  and sale of bowling  equipment and bowling
products ("Bowling Products").

     To  facilitate  a  meaningful  comparison,  in addition to  discussing  the
consolidated  results of the  Company,  certain  portions  of this  Management's
Discussion and Analysis of Financial Condition and Results of Operations discuss
results of Bowling Centers and Bowling Products separately.

     The results of Bowling Centers, Bowling Products and the consolidated group
are set forth below.  The business  segment  results  presented below are before
intersegment eliminations since the Company's management believes that this will
provide a more accurate  comparison of performance by segment from year to year.
The intersegment eliminations are not material. Interest expense is presented on
a gross basis.  The  comparative  results of Bowling  Centers for the first nine
months of 2000 versus 1999 reflect the closing of 16 centers since September 30,
1999.

Acquisitions and Dispositions

         From January 1, 2000 through  September 30, 2000, AMF Bowling  Centers,
Inc., a direct subsidiary of Bowling  Worldwide,  acquired four bowling centers,
closed twelve centers and terminated a management contract for one center in the
United  States,  closed one  center in Japan,  and sold one center in the United
Kingdom and one center in Canada.


                                       20
<PAGE>

                                AMF BOWLING, INC.
                             Selected Financial Data
                                   (unaudited)
                            (in millions of dollars)

<TABLE>
<CAPTION>
                                                                                 Three Months               Nine Months
                                                                               Ended September 30,       Ended September 30,
                                                                             ----------------------- ---------------------------
                                                                                2000        1999         2000          1999
                                                                                ----        ----         ----          ----
<S>                                                                             <C>         <C>           <C>           <C>
Bowling Centers (before intersegment eliminations)
---------------
Operating revenue                                                               $ 126.6     $ 125.9       $ 427.9       $ 427.8
                                                                             ----------- ----------- -------------  ------------
Cost of goods sold                                                                 12.8        13.9          43.6          44.5
Bowling center operating expenses                                                  93.0        93.1         281.5         277.5
Selling, general, and administrative expenses                                       1.6         7.5           5.1          10.9
Restructuring charges                                                                 -         0.2             -           0.2
Depreciation and amortization                                                      27.3        31.8          82.4          85.9
                                                                             ----------- ----------- -------------  ------------
Operating (loss) income                                                          $ (8.1)     $(20.6)       $ 15.3         $ 8.8
                                                                             =========== =======================================

Bowling Products (before intersegment eliminations)
----------------
Operating revenue                                                                $ 42.0      $ 60.7       $ 118.9       $ 131.6
Cost of goods sold                                                                 31.1        55.6          88.2         110.9
                                                                             ----------- ----------- -------------  ------------
Gross profit                                                                       10.9         5.1          30.7          20.7
                                                                                      -           -
Selling, general, and administrative expenses                                       8.6        20.7          23.1          36.9
Restructuring charges                                                                 -         7.2             -           7.2
Depreciation and amortization                                                       6.1         5.9          18.1          17.6
                                                                             ----------- ----------- -------------  ------------
Operating loss                                                                   $ (3.8)     $(28.7)      $ (10.5)      $ (41.0)
                                                                             =========== =========== =============  ============

Consolidated
------------
Operating revenue                                                               $ 162.1     $ 182.8       $ 532.3       $ 546.5
                                                                             ----------- ----------- -------------  ------------
Cost of goods sold                                                                 37.8        66.2         118.4         143.6
Bowling center operating expenses                                                  92.6        92.8         280.6         276.7
Selling, general, and administrative expenses                                      16.1        34.3          44.4          64.8
Restructuring charges                                                                 -         7.5             -           7.5
Refinancing charges                                                                 2.2           -           2.2             -
Depreciation and amortization                                                      33.4        37.6         100.6         104.0
                                                                             ----------- ----------- -------------  ------------
Operating loss                                                                    (20.0)      (55.6)        (13.9)        (50.1)
Interest expense, gross                                                            34.7        31.1          98.8          95.5
Other (income) expense, net                                                         1.4        (0.4)          2.5           4.6
                                                                             ----------- ----------- -------------  ------------
Loss before income taxes                                                          (56.1)      (86.3)       (115.2)       (150.2)
Provision for income taxes                                                          0.9        23.1           3.0          26.3
                                                                             ----------- ----------- -------------  ------------
Net loss before equity in loss of  joint ventures and extraordinary item          (57.0)     (109.4)       (118.2)       (176.5)
Equity in loss of joint ventures                                                   (0.1)       (0.1)         (0.7)         (5.8)
                                                                             ----------- ----------- -------------  ------------
Net loss before extraordinary item                                                (57.1)     (109.5)       (118.9)       (182.3)
Extraordinary item                                                                    -        64.5             -          64.5
                                                                             ----------- ----------- -------------  ------------
Net loss                                                                         $(57.1)     $(45.0)     $ (118.9)     $ (117.8)
                                                                             =========== =========== =============  ============

Selected Data:
--------------
   Recurring EBITDA (a)
     Bowling Centers                                                             $ 19.2      $ 18.0        $ 97.7       $ 101.5
     Bowling Products                                                             $ 2.3       $ 5.1         $ 7.6         $ 4.5

   Recurring EBITDA margin
     Bowling Centers                                                              15.2%       14.3%         22.8%         23.7%
     Bowling Products                                                              5.5%        8.4%          6.4%          3.4%
</TABLE>

      (a)    Recurring   EBITDA    represents    EBITDA   before    nonrecurring
             restructuring  charges and Special  Charges of  approximately  $7.5
             million  and $27.5  million,  respectively,  for the three and nine
             months ended September 30, 1999.


                                       21
<PAGE>

Bowling Centers

     The Bowling Centers results shown in "Selected Financial Data" reflect both
U.S. and international  Bowling Centers  operations.  To facilitate a meaningful
comparison,  the constant center results  discussed below reflect the results of
508 centers that had been in  operation  one full fiscal year as of December 31,
1999.  Bowling  Centers  derives its revenue and cash flows from three principal
sources:  (i) bowling,  (ii) food and beverage and (iii) other sources,  such as
shoe rental, amusement games, billiards and pro shops. For the nine months ended
September 30, 2000,  bowling,  food and beverage and other  revenue  represented
57.8%, 27.2% and 15.0% of total Bowling Centers revenue,  respectively.  For the
nine months  ended  September  30,  1999,  bowling,  food and beverage and other
revenue  represented  58.3%,  27.0% and 14.7% of total Bowling Centers  revenue,
respectively.

     To facilitate a meaningful comparison, the results of Bowling Centers for
the quarter and nine months ended September 30, 1999, have been restated to
exclude nonrecurring restructuring and Special Charges (as defined in "--
Consolidated - Nonrecurring Restructuring Charges and Special Charges") as shown
in the table below. The discussion below gives effect to this restatement. See
"Note 5. Long-Term Debt" in the Notes to Condensed Consolidated Financial
Statements and "--Consolidated - Nonrecurring Restructuring Charges and Special
Charges".

<TABLE>
<CAPTION>
                                                                    Three Months
                                                                 Ended September 30,
                                                   -----------------------------------------------
                                                      2000                    1999
                                                   ------------ ----------------------------------
                                                       As           As       Special       As
                                                    Reported.    Reported    Charges    Adjusted
Bowling Centers (before intersegment eliminations)
<S>                                                    <C>         <C>            <C>     <C>
Operating revenue                                      $ 126.6     $ 125.9        $ -     $ 125.9
                                                   ------------ ----------- ---------- -----------
Cost of goods sold                                        12.8        13.9        0.9        13.0
Bowling center operating expenses                         93.0        93.1          -        93.1
Selling, general, and administrative expenses              1.6         7.5        5.7         1.8
Restructuring charges                                        -         0.2        0.2           -
Depreciation and amortization                             27.3        31.8          -        31.8
                                                   ------------ ----------- ---------- -----------
Operating (loss) income                                 $ (8.1)    $ (20.6)    $ (6.8)    $ (13.8)
                                                   ============ =========== ========== ===========

Selected Data:
   Recurring EBITDA                                     $ 19.2      $ 11.2                 $ 18.0
   Recurring EBITDA margin                               15.2%        8.9%                  14.3%

<CAPTION>

                                                                      Nine Months
                                                                  Ended September 30,
                                                   ------------------------------------------------
                                                      2000                      1999
                                                   ------------  ----------------------------------
                                                       As            As       Special       As
                                                   Reported.      Reported    Charges    Adjusted
Bowling Centers (before intersegment eliminations)
Operating revenue                                     $ 427.9       $ 427.8        $ -     $ 427.8
                                                   -----------   ----------- ---------- -----------
Cost of goods sold                                       43.6          44.5        0.9        43.6
Bowling center operating expenses                       281.5         277.5          -       277.5
Selling, general, and administrative expenses             5.1          10.9        5.7         5.2
Restructuring charges                                       -           0.2        0.2           -
Depreciation and amortization                            82.4          85.9          -        85.9
                                                   -----------   ----------- ---------- -----------
Operating (loss) income                                $ 15.3         $ 8.8     $ (6.8)     $ 15.6
                                                   ===========   =========== ========== ===========

Selected Data:
   Recurring EBITDA                                    $ 97.7        $ 94.7                $ 101.5
   Recurring EBITDA margin                              22.8%         22.1%                  23.7%

</TABLE>

Quarter Ended September 30, 2000 Compared to Quarter Ended September 30, 1999

     Bowling  Centers  operating  revenue  increased  $0.7 million,  or 0.6%. An
increase of $4.9 million,  or 5.2%, was attributable to U.S.  constant  centers,
primarily  as a result of price  increases  in open play  revenue,  and food and
beverage and ancillary revenue associated with open play traffic.  International
constant centers operating revenue  decreased $3.0 million,  or 9.9%,  primarily
due to  unfavorable  currency  translation  of results.  On a constant  currency
basis,  international  operating  revenue would have decreased $0.4 million,  or
1.3%. An increase of $0.8 million is  attributable  to two new U.S.  centers.  A
decrease of $2.0 million in total operating revenue was attributable to fourteen
centers that were closed,  two centers that were sold and one center  management
contract that was terminated since September 30, 1999.

     Cost of goods sold decreased $0.2 million,  or 1.5%,  primarily as a result
of closing centers.  Constant centers cost of goods sold decreased $0.1 million,
or 0.9%, compared with 1999.

     Operating  expenses  decreased  $0.1 million,  or 0.1%. An increase of $0.8
million was  attributable to constant  centers,  an increase of $0.7 million was
attributable to new centers and an increase of $0.2 million was  attributable to
higher regional,  district and support staff operations  expenses. A decrease of
$1.8 million was attributable to closed centers. As a percentage of its revenue,
Bowling Centers operating expenses,  adjusted for the nonrecurring restructuring
and Special  Charges,  were 73.4% for the third  quarter of 2000  compared  with
73.9% for the third quarter of 1999. Due to  significantly  lower league play in
the second and third quarters, Bowling Center operating expenses as a percentage
of operating  revenue are higher in these  quarters than in the first and fourth
quarters.



                                       22
<PAGE>

     Selling,  general  and  administrative  expenses decreased $0.2 million, or
11.1%,  compared  with the same  period  in 1999  primarily  as a result of more
effective expense management in international constant centers.

     Recurring EBITDA increased $1.2 million, or 6.7%. Recurring EBITDA margin
for the third quarter of 2000 was 15.2% compared with 14.3% for the third
quarter of 1999. The higher recurring EBITDA margin in 2000 was attributable to
the higher operating revenue and lower expenses as discussed above.

Nine Months Ended September 30, 2000 Compared to Nine Months Ended September 30,
1999

     Bowling Centers operating  revenue  increased $0.1 million.  An increase of
$9.2 million, or 2.8%, was attributable to U.S. constant centers, primarily as a
result  of price  increases  in open play  revenue,  and food and  beverage  and
ancillary  revenue  associated  with open play traffic.  International  constant
centers  operating  revenue  decreased $4.0 million,  or 4.3%,  primarily due to
unfavorable  currency  translation  of results.  On a constant  currency  basis,
international  operating revenue would have increased $0.5 million,  or 0.5%. An
increase of $0.9 million was attributable to two new U.S. centers. A decrease of
$6.0 million in total operating  revenue was  attributable  to fourteen  centers
that were closed, two centers that were sold and one center management  contract
that was terminated since September 30, 1999.

     Cost of goods sold was flat compared with the same period in 1999. Constant
centers cost of goods sold  increased  $0.4  million,  or 1.0%,  resulting  from
increased food and beverage sales primarily in the U.S.  centers.  A decrease of
$0.5 million was  attributable to closed centers and an increase of $0.1 million
was attributable to new centers.

     Operating  expenses  increased  $4.0 million,  or 1.4%. An increase of $5.8
million was  attributable to constant  centers,  an increase of $0.8 million was
attributable to new centers and an increase of $2.3 million was  attributable to
higher regional,  district and support staff operations  expenses. A decrease of
$4.9 million was attributable to closed centers. As a percentage of its revenue,
Bowling Centers operating  expenses were 65.8% for the first nine months of 2000
compared  with 64.9% for the first nine months of 1999.  The increase of 0.9% is
due primarily to higher  expenses  resulting from new field level  positions and
national advertising programs.

         Selling, general and administrative expenses decreased $0.1 million, or
1.9%,  compared  with 1999 as a result of a decrease in  international  constant
centers selling general and administrative expenses.

          Recurring  EBITDA decreased $3.8 million,  or 3.7%.  EBITDA margin for
the first nine months of 2000 was 22.8%  compared  with 23.7% for the first nine
months  of 1999.  The  lower  recurring  EBITDA  margin  in 2000  was  primarily
attributable to the higher operating expenses as discussed above.


                                       23
<PAGE>

Bowling Products

To facilitate a meaningful comparison, the results of Bowling Products for the
quarter and nine months ended September 30, 1999, have been restated to exclude
nonrecurring restructuring and Special Charges (as defined in "--Consolidated -
Nonrecurring Restructuring Charges and Special Charges") as shown in the table
below. The discussion below gives effect to this restatement. See "Note 5. Long-
Term Debt" in the Notes to Condensed Consolidated Financial Statements and "--
Consolidated - Nonrecurring Restructuring Charges and Special Charges".

<TABLE>
<CAPTION>
                                                                     Three Months
                                                                  Ended September 30,
                                                   -----------------------------------------------
                                                      2000                    1999
                                                   ------------ ----------------------------------
                                                       As           As       Special       As
                                                    Reported.    Reported    Charges    Adjusted
Bowling Products (before intersegment eliminations)
<S>                                                     <C>         <C>           <C>      <C>
Operating revenue                                       $ 42.0      $ 60.7        $ -      $ 60.7
Cost of goods sold                                        31.1        55.6        8.0        47.6
                                                   ------------ -----------------------------------
Gross profit                                              10.9         5.1       (8.0)       13.1

Selling, general, and administrative expenses              8.6        20.7       12.7         8.0
Restructuring charges                                        -         7.2        7.2           -
Depreciation and amortization                              6.1         5.9          -         5.9
                                                   ------------ -----------------------------------
Operating loss                                          $ (3.8)    $ (28.7)    $(27.9)     $ (0.8)
                                                   ============ ===================================

Selected Data:
   Recurring EBITDA                                      $ 2.3     $ (22.8)                 $ 5.1
   Recurring EBITDA margin                                5.5%      -37.6%                   8.4%

<CAPTION>

                                                                        Nine Months
                                                                    Ended September 30,
                                                    ------------------------------------------------
                                                       2000                     1999
                                                    ------------  ----------------------------------
                                                        As            As       Special       As
                                                    Reported.      Reported    Charges    Adjusted
<S>                                                 <C>            <C>         <C>        <C>
Bowling Products (before intersegment eliminations)
Operating revenue                                      $ 118.9       $ 131.6        $ -     $ 131.6
Cost of goods sold                                        88.2         110.9        8.0       102.9
                                                    ------------------------- ---------- -----------
Gross profit                                              30.7          20.7       (8.0)       28.7

Selling, general, and administrative expenses             23.1          36.9       12.7        24.2
Restructuring charges                                        -           7.2        7.2           -
Depreciation and amortization                             18.1          17.6          -        17.6
                                                    ------------------------- ---------- -----------
Operating loss                                         $ (10.5)      $ (41.0)    $(27.9)    $ (13.1)
                                                    ========================= ========== ===========

Selected Data:
   Recurring EBITDA                                      $ 7.6       $ (23.4)                 $ 4.5
   Recurring EBITDA margin                                6.4%        -17.8%                   3.4%
</TABLE>

Quarter Ended September 30, 2000 Compared to Quarter Ended September 30, 1999

     Bowling  Products  operating  revenue  decreased  $18.7 million,  or 30.8%.
Revenue  from  sales of New  Center  Packages  ("NCPs",  which  include  all the
equipment necessary to outfit a new bowling center or expand an existing bowling
center) decreased $8.7 million,  or 41.6%,  primarily as a result of lower sales
to Asia,  Europe and  international  distributors.  Modernization  and  Consumer
Products  (which  include  modernization  equipment,  supplies,  spare parts and
consumable  products) revenue decreased $10.0 million, or 25.1%,  primarily as a
result of decreased  sales to Asia and  international  distributors.  Management
believes  that its  Bowling  Products  business  results  have  been  negatively
impacted by the uncertainty surrounding the Company's financial position.

     Gross profit  decreased  $2.2 million,  or 16.8%,  primarily as a result of
decreased sales volume.

     Selling,  general and administrative  expenses  increased $0.6 million,  or
7.5%,  primarily  due to  increased  advertising  expenses  intended to increase
product awareness.

      Recurring  EBITDA was $2.3 million in the third  quarter of 2000  compared
with $5.1 million in the third quarter of 1999. The recurring  EBITDA margin was
5.5% in the third  quarter of 2000  compared  with 8.4% in the third  quarter of
1999  primarily  as a result  of the  decrease  in sales and  gross  profit  and
increase in selling, general and administrative costs.

Nine Months Ended September 30, 2000 Compared to Nine Months Ended September 30,
1999

     Bowling  Products  operating  revenue  decreased  $12.7  million,  or 9.7%.
Revenue  from sales of NCPs  decreased  $2.5  million,  or 6.5%,  primarily as a
result of lower sales to Japan.  Modernization  and  Consumer  Products  revenue
decreased $10.2 million, or 11.0%, primarily as a result of lower sales to North
America and Asia.

     Gross profit increased $2.0 million, or 7.0%, primarily as a result of more
favorable  product  mix and  product  cost  reduction  efforts in the first nine
months of 2000 compared with the first nine months of 1999.

     Selling,  general and administrative  expenses  decreased $1.1 million,  or
4.5%,  primarily  reflecting the cost reduction program for the Bowling Products
organization implemented in this area through the second half of 1999.



                                       24
<PAGE>

      Recurring  EBITDA  was $7.6  million  in the  first  nine  months  of 2000
compared  with $4.5  million in the first  nine  months of 1999.  The  recurring
EBITDA  margin was 6.4% in the first nine months of 2000  compared  with 3.4% in
the first nine  months of 1999  primarily  as a result of the  increase in gross
profit and selling,  general and  administrative  savings  achieved through cost
reductions.

Consolidated

Nonrecurring Restructuring Charges and Special Charges

     During  the  third  quarter  of 1999,  the  Company  recorded  nonrecurring
restructuring  charges of approximately $7.5 million that were related primarily
to a plan to reorganize and downsize the Bowling  Products  business in response
to market  weakness in the Asia Pacific region and increased  competition  which
negatively   and   materially   impacted  NCP  sales  and   profitability.   The
restructuring  plan was  developed  in  conjunction  with a  strategic  business
assessment  performed  by Bain & Co.  and was  designed  to reduce  the  overall
volatility of the Bowling Products business.  The restructuring  charges related
primarily  to employee  termination  benefits,  asset  write-offs  and  contract
cancellations.

     In addition, the strategic assessment by Bain & Co. led to programs
designed to improve product line profitability and quality. This assessment was
a catalyst to the Company recording certain charges. These charges, along with
additional reserves (collectively, the "Special Charges") recorded by the
Company totaled $27.5 million for the period ended September 30, 1999. The
Special Charges are non-cash, relate primarily to receivables and inventory
write-offs and are included within operating expenses. See "Note 5. Long-Term
Debt" in the Notes to Condensed Consolidated Financial Statements.

Depreciation and Amortization

     Depreciation  and  amortization  decreased $4.2 million,  or 11.2%,  in the
third  quarter of 2000,  and $3.4  million,  or 3.3%,  in the nine months  ended
September 30, 2000 compared to the same periods in 1999.  These  decreases  were
primarily  attributable  to  acceleration,  in the third quarter of 1999, of the
amortization  schedule of the excess of the Company's investment over the equity
in its Brazilian  joint  venture's net assets  partially  offset by  incremental
depreciation expense incurred as a result of capital expenditures.

Interest Expense

     Gross  interest  expense  increased  $3.6 million,  or 11.6%,  in the third
quarter of 2000, and $3.3 million,  or 3.5%, in the nine months ended  September
30, 2000 compared with the same periods in 1999.  Interest incurred on bank debt
increased as the impact of higher average  borrowing  rates and the effect of an
increase  in average  amounts  outstanding.  See  "--Liquidity"  and  "--Capital
Resources"  for further  discussion  of the bank debt.  Non-cash  bond  interest
amortization  totaled  $10.8  million and $31.4 million for the quarter and nine
months ended  September  30, 2000,  respectively,  compared to $10.5 million and
$33.8  million  for the  quarter  and nine  months  ended  September  30,  1999,
respectively.

Income Taxes

         As of  September  30,  2000,  the Company had net  operating  losses of
approximately  $263.6 million and foreign tax credits of $11.5 million that will
carry over to future years to offset U.S. income taxes.  The foreign tax credits
will begin to expire in the fiscal year 2001 and the net  operating  losses will
begin to expire in the fiscal year 2011.  The  Company has  recorded a valuation
reserve,  as of December 31, 1999, for $113.0  million  related to net operating
losses,  foreign tax credits and other  deferred tax assets that the Company may
not utilize prior to their expirations.  The tax provision recorded for the nine
months ended September 30, 2000 reflects certain international taxes.

Net Loss Before Extraordinary Item

     Net loss  before  extraordinary  item in the third  quarter and nine months
ended September 30, 2000 totaled $57.1 million and $118.9 million, respectively,
compared with a net loss before  extraordinary item of $109.5 million and $182.3
million  in the  third  quarter  and  nine  months  ended  September  30,  1999,


                                       25
<PAGE>

respectively.  In addition to the impact of EBITDA,  depreciation,  interest and
taxes  discussed  above,  the Company  recorded $0.1 million and $0.7 million in
equity in loss of joint  ventures in the third  quarter and first nine months of
2000,  respectively,  compared  with  equity in loss of joint  ventures  of $0.1
million  and $5.8  million in the third  quarter  and first nine months of 1999,
respectively.  Additionally,  the Company recorded other expense of $1.4 million
and $2.5  million in the third  quarter and first nine  months of 2000  compared
with other income of $0.4 million and other expense of $4.6 million in the third
quarter and first nine months of 1999, respectively.

Extraordinary Item

     As part of a recapitalization  plan, AMF Bowling completed on July 28, 1999
an offering of rights to purchase  shares of Common Stock and a tender offer for
a portion of its  outstanding  principal  amount at maturity of  Debentures at a
discount to carrying  value. In the rights  offering,  AMF Bowling raised $120.0
million of gross proceeds in equity  capital and issued 24.0 million  additional
shares of Common Stock at the subscription price of $5.00 per share. AMF Bowling
purchased  $514,286,000  in  aggregate  principal  amount  at  maturity  of  the
Debentures in the tender offer at a price of $140 per $1,000 principal amount at
maturity.  The Company used approximately $72.0 million of the proceeds from the
rights  offering  to  fund  the  purchase  of the  Debentures  and  recorded  an
extraordinary  gain of approximately  $64.5 million  representing the difference
between the accreted  value of the  Debentures  purchased and the purchase price
therefor.

Net Loss After Extraordinary Item

     Net loss in the third  quarter and nine  months  ended  September  30, 2000
totaled $57.1 million and $118.9 million,  respectively,  compared with net loss
after  extraordinary  item of $45.0  million  and  $117.8  million  in the third
quarter and nine months ended September 30, 1999, respectively.

Liquidity

     The Company's primary source of liquidity is cash provided by operations
and funds available under credit facilities, as described below. Working capital
on September 30, 2000 was (1,230.3) million compared with $22.5 million on
December 31, 1999, a decrease of (1,252.8) million. The decrease is primarily
attributable to the reclass of $1,257.4 million of long-term debt that would be
due if the Company's debt obligations were accelerated as described in "Note 1.
Organization and Restructuring" and "Note 5. Long-Term Debt". Additionally,
scheduled principal payments due in the next 12 months under the Credit
Agreement increased $19.5 million and there was a decrease of $6.4 million in
cash. These decreases in working capital were partially offset by an increase of
$6.0 million in accounts receivable, an increase of $16.6 million in inventory
primarily attributable to a timing difference between planned production and
related shipments, an increase of $1.1 million in other current assets, a
decrease of $5.4 million in accounts payable and accrued expenses and a decrease
of $1.4 million in income taxes payable.

     Net cash used by operating activities was $11.9 million for the nine months
ended September 30, 2000 compared with net cash used of $10.7 million for the
nine months ended September 30, 1999, a difference of $1.2 million. A decrease
of $1.1 million was attributable to net loss of $118.9 million recorded in the
first nine months of 2000 compared with a net loss of $117.8 million in the same
period in 1999, a decrease of $3.5 million attributable to decreased levels of
depreciation and amortization, a decrease of $5.1 million due to lower loss in
equity of joint ventures, a decrease of $2.7 million attributable to lower
levels of accounts payable and accrued expenses, a decrease of $8.0 million
attributable to increased levels of accounts receivable, a decrease of $31.5
million attributable to higher inventory balances, a net decrease of $2.4
million due to lower levels of bond amortization, a decrease of $20.8 million
resulting from deferred income taxes recorded in 1999 and a net decrease of $6.9
million attributable to changes in other operating activities. These decreases
were partially offset by an increase of $64.5 million attributable to
attributable to extraordinary item, net of tax, and an increase of $16.3 million
attributable to lower levels of other assets.

     Net cash used in investing activities was $51.5 million for the nine months
ended  September  30, 2000  compared with net cash used of $35.7 million for the
nine months ended September 30, 1999, an increase of $15.8 million.  An increase
of $14.4  million was  attributable  to an increase in purchases of property and
equipment in 2000. An increase of $4.0 million was  attributable  to an increase
in Bowling Center acquisition spending in the first nine months of 2000 compared
with the same  period in 1999.  In the first nine months of 2000,  four  centers
were  purchased  compared  with one  center in the same  period  in 1999.  These
factors  contributing  to the  increase  in net cash  flows  were  offset  by an
increase of $2.6 million in proceeds  from the sale of property  and  equipment.
See "--Capital  Expenditures" for additional discussion of purchases of property
and equipment.



                                       26
<PAGE>

     Net cash provided by financing activities was $58.2 million for the nine
months ended September 30, 2000 compared with net cash provided of $43.8 million
for the nine months ended September 30, 1999, a difference of $14.4 million.
Proceeds from long term debt increased $32.0 million. Payments on long-term debt
decreased $102.1 million. In accordance with the terms of Bowling Worldwide's
fourth Amended and Restated Credit Agreement dated as of June 14, 1999 (the
"Credit Agreement"), scheduled principal payments in the first nine months of
2000 were $1.9 million higher than payments made in the same period in 1999.
Additionally, in the first nine months of 2000, $5.0 million was paid against
amounts outstanding under the Bank Facility compared with $37.0 million for the
same period in 1999, $30.0 million of which represented proceeds from the 1999
rights offering. The Company also used approximately $72.0 million from the
rights offering to fund the purchase in the tender offer of the Debentures in
July 1999. In the first nine months of 1999, $119.7 million was provided from
net proceeds of the rights offering. See "Note 5. Long-Term Debt" in the Notes
to Condensed Consolidated Financial Statements and "--Capital Resources".

     As a result of the  aforementioned,  cash decreased by $6.4 million for the
nine months ended  September  30, 2000  compared with a decrease of $2.8 million
for the nine months ended September 30, 1999.

     AMF Bowling is a holding company with limited financial resources. Based on
current  projections,  AMF Bowling  will  deplete its cash balance by the end of
2000. If this occurs, it would be necessary for AMF Bowling Worldwide to receive
an amendment to its Credit Agreement to permit advances to AMF Bowling. Any such
amendment  would be  subject to the  approval  of the  lenders  under the Credit
Agreement.

     For a discussion of the impact of the Company's financial position or the
Company's ability to raise financing and meet its liquidity needs, see "Note 1.
Organization and Restructuring" in the Notes to the Condensed Consolidated
Financial Statements and "--Capital Resources" below.

Capital Resources

     The Company's total  indebtedness is primarily a result of the financing of
the acquisition of the Company in 1996 by an investor group led by affiliates of
Goldman, Sachs & Co. (the "Acquisition") and the Company's bowling center
acquisition program. At September 30, 2000, the Company's debt consisted of
$617.1 million of borrowings under the Credit Agreement and a mortgage
(collectively, the "Senior Debt"), $250.0 million of Bowling Worldwide's senior
subordinated notes (the "Senior Subordinated Notes"), $262.3 million of Bowling
Worldwide's senior subordinated discount notes ("Senior Subordinated Discount
Notes"), and $181.7 million of the Convertible Debentures. At September 30,
2000, the Company's Senior Debt consisted of $365.1 million outstanding under
term loan facilities under the Credit Agreement (the "Term Facilities"), $250.0
million outstanding under a non-amortizing revolving credit facility under the
Credit Agreement (the "Bank Facility") and $2.0 million represented by one
mortgage note.

     Bowling Worldwide has the ability to borrow for general corporate purposes.
At  September  30,  2000,  $250.0  million  was  outstanding,  $4.5  million was
committed  for standby and  documentary  letters of credit and $12.5 million was
available for borrowing under the Bank Facility,  subject to certain limitations
applicable  to  borrowings  regarding  acquisitions  and  capital  expenditures.
Between September 30, 2000 and October 31, 2000, there were no borrowings and no
payments under the Bank  Facility.  The standby  letters of credit  increased by
approximately $0.7 million.

      During  the  first  nine months of 2000, the Company funded its cash needs
through  cash flow from  operations,  cash  balances  and the Bank  Facility.  A
substantial  portion of the Company's  available cash will be applied to service
outstanding indebtedness.  For the nine months ended September 30, 2000, Bowling
Worldwide incurred cash interest expense of $65.7 million, representing 73.9% of
EBITDA for the period.  For the nine months ended  September  30, 1999,  Bowling
Worldwide incurred cash interest expense of $60.0 million, representing 67.5% of
EBITDA for the period.

      The Company's capital position has very significantly impacted the
Company's ability to finance its operations and to make necessary capital
expenditures. The August 14, 2000 Amendment to the Credit Agreement
substantially reduced Bowling Worldwide's borrowing capacity under the Credit
Agreement. On September 15, 2000, Bowling Worldwide did not make the required
cash interest payment on the Senior Subordinated Notes, and on October 15, 2000,
the 30 day period to cure the non-payment of interest under the related
Indenture expired. Under the Indenture, the Trustee on its own or the holders of
25% or more of the outstanding principal amount of the Senior Subordinated Notes
have at any time the right, by written notice, to accelerate their indebtedness
and if they did so, lenders under the Credit Agreement and holders of the Senior
Subordinated Discount Notes and Convertible Debentures would have a similar
ability. If the indebtedness represented by the Senior Subordinated Notes were
so accelerated, such acceleration would result in a default under the Credit
Agreement, Bowling Worldwide's Senior Subordinated Discount Notes, AMF Bowling's
Convertible Debentures and certain other Company indebtedness. In such event,
the Company would not then be able to meet its accelerated payment obligations.
While the financial covenants in the Credit Agreement have been


                                       27
<PAGE>

waived through December 31, 2000, unless extended, the waiver will expire
without the implementation of a restructuring plan. If the waiver is not
extended or a further waiver is not obtained, Bowling Worldwide will not be able
to meet the reinstated financial covenants. Bowling Worldwide is obligated to
make a scheduled principal payment of approximately $12.8 million under the
Credit Agreement by December 31, 2000, which it does not expect to be able to
make. The Company does not expect to be able to access new financing, either to
fund its operations or to pay required interest and principal payments until it
accomplishes a restructuring or refinancing. The Company has retained financial
and legal advisors to evaluate and assist it with its restructuring and
financing alternatives. See "Note 1. Organization and Restructuring" and "Note
5. Long-Term Debt" in the Notes to Condensed Consolidated Financial Statements.

     The Company was notified on July 19, 2000 that it did not at that time meet
the New York Stock Exchange's  continued listing  requirements because the stock
had  traded  below  $1 per  share  for  over a 30  trading-day  period.  If this
situation  continues  for six months,  the Company may be delisted  from the New
York Stock Exchange.

Capital Expenditures

     For the nine months ended September 30, 2000, Bowling  Worldwide's  capital
expenditures  were $49.5  million  compared to $35.0 million for the nine months
ended  September  30,  1999,  an  increase  of $14.5  million.  Bowling  Centers
maintenance  and  modernization  expenditures  increased  $9.0 million.  Bowling
Products expenditures increased $1.8 million.  Company-wide  information systems
expenditures decreased $1.4 million. Investments in Xtreme(TM) bowling equipment
at various AMF bowling centers increased by $5.7 million.  Capital  expenditures
for new centers were $0.6 million  higher in 1999 due to the  construction  of a
Michael Jordan Golf Center.

     Bowling Worldwide has historically funded its capital expenditures and
construction and acquisition of new centers with internally-generated cash, the
Bank Facility and issuances of Common Stock by AMF Bowling. See "Note 1.
Organization and Restructuring" in the Notes to Condensed Consolidated Financial
Statements, "--Liquidity" and "--Capital Resources."

      On August 14, 2000, Bowling Worldwide and the lenders under the Credit
Agreement entered into an amendment, pursuant to which compliance with all
financial covenants were waived through December 31, 2000 and the revolving
credit facility will be reduced to $255.0 million by year-end. See "Note 1.
Organization and Restructuring" in the Notes to Condensed Consolidated Financial
Statements.

Seasonality and Market Development Cycles

     The financial performance of Bowling Centers' operations is seasonal.  Cash
flows  typically peak in the winter when U.S.  leagues are most active and reach
their  lows in the  summer.  While the  geographic  diversity  of the  Company's
Bowling Centers  operations has helped reduce this  seasonality in the past, the
increase  in  U.S.  centers   resulting  from  acquisitions  has  increased  the
seasonality of that business.

     Modernization  and Consumer  Products sales also display  seasonality.  The
U.S.  market,  which  is the  largest  market  for  Modernization  and  Consumer
Products,  is driven by the  beginning  of league play in the fall of each year.
While operators purchase consumer products throughout the year, they often place
larger orders during the summer in  preparation  for the start of league play in
the  fall.  Summer  is also  generally  the  peak  period  for  installation  of
modernization   equipment.   Operators   typically  sign  purchase   orders  for
modernization  equipment  during  the first  four  months of the year after they
receive  winter  league  revenue  indications.  Equipment  is then  shipped  and
installed  during the summer when leagues are  generally  less active.  However,
sales of some  modernization  equipment such as automatic  scoring and synthetic
lanes are less predictable and fluctuate from year to year because of the longer
life cycle of these major products.

     While  sales of NCPs are  slightly  seasonal,  sales of NCPs can  fluctuate
dramatically as a result of economic  fluctuations in international  markets, as
seen in the  reduction  of sales of NCPs to markets in the Asia  Pacific  region
following economic difficulties in that region.

International Operations

     The  Company's  international  operations  are  subject to the usual  risks
inherent in operating abroad,  including,  but not limited to, currency exchange
rate  fluctuations,  economic and political  fluctuations  and  destabilization,
other  disruption  of markets,  restrictive  laws,  tariffs and other actions by
foreign  governments  (such as  restrictions  on transfer  of funds,  import and


                                       28
<PAGE>

export  duties and quotas,  foreign  customs,  tariffs and value added taxes and
unexpected  changes  in  regulatory   environments),   difficulty  in  obtaining
distribution and support for products, the risk of nationalization, the laws and
policies of the United States  affecting  trade,  international  investment  and
loans, and foreign tax law changes.

     The  Company  has a  history  of  operating  in a number  of  international
markets,  in some cases,  for over 30 years. As in the case of other  U.S.-based
manufacturers with export sales, local currency  devaluation  increases the cost
of the Company's  bowling equipment in that market. As a result, a strengthening
U.S.  dollar  exchange rate  adversely  impacts sales volume and profit  margins
during such periods.

     Foreign  currency  exchange rates also impact the  translation of operating
results from international  bowling centers. For the nine months ended September
30, 2000, revenue and EBITDA of international  bowling centers represented 16.6%
and 27.9% of consolidated revenue and EBITDA, respectively.  For the nine months
ended September 30, 1999,  revenue and EBITDA of  international  bowling centers
represented 17.2% and 29.9% of consolidated revenue and EBITDA, respectively.

     Economic  difficulties  in the Asia Pacific  region,  including the limited
availability  of financing  for  customers  seeking to build new  centers,  have
continued to keep demand for NCPs below peak levels  achieved  during  1997.  In
response to these market  conditions,  Bowling  Products entered into three-year
joint distribution  agreements with Zhonglu on June 13, 1999. Under the terms of
these  agreements,  Zhonglu became the exclusive  distributor of AMF products in
China,  and Bowling  Products  became the  exclusive  distributor  of  Zhonglu's
bowling  products and parts outside of China.  In 1999 and the first nine months
of 2000, Bowling Products has purchased  component parts from Zhonglu as part of
its long-term strategy to reduce manufacturing costs. However, sales of both AMF
products in China and Zhonglu products outside China have been slower to develop
than  anticipated.   In  September,   the  Company  and  Zhonglu  amended  their
distribution agreements to move the sales relationship to a non-exclusive basis.
The Company  continues to source some  component  parts from  Zhonglu  under the
revised agreements, but both parties are pursuing alternative sales channels.

     NCP unit  sales to China,  Japan and other  countries  in the Asia  Pacific
region  represented  34.5% of total  NCP unit  sales for the nine  months  ended
September 30, 2000 compared to 43.0% for the year ended December 31, 1999.

     China has strengthened  enforcement of its import restrictions by requiring
the payment of full customs duties and value-added taxes on the importation of
new and used capital goods. The Chinese government also prohibits importation of
used capital equipment without permits. Permits for the importation of used
bowling equipment are very difficult to obtain. Local Chinese companies,
however, are not subject to the same restrictions. For example, in addition to
being a distributor of AMF products, Zhonglu produces locally and sells bowling
equipment that is not subject to the customs duties or permit requirements that
affect the Company's imported equipment. Zhonglu has experienced significant
acceptance by local customers. Management believes that these import
restrictions will continue for the foreseeable future and the Chinese market
will continue to contract.

Impact of Inflation

     The Company has historically  offset the impact of inflation  through price
increases  and  expense  reductions.  Periods  of high  inflation  could  have a
material  adverse impact on the Company to the extent that  increased  borrowing
costs for floating rate debt may not be offset by increases in cash flow.  There
was no significant  impact on the Company's  operations as a result of inflation
for the nine months ended September 30, 2000 and 1999, respectively.

Environmental Matters

     The Company's  operations are subject to federal,  state, local and foreign
environmental  laws and regulations that impose limitations on the discharge of,
and  establish  standards  for  the  handling,  generation,  emission,  release,
discharge, treatment, storage and disposal of, certain materials, substances and
wastes.

     The  Company  currently  and from time to time is subject to  environmental
claims.  In  management's  opinion,  the  various  claims in which  the  Company
currently  is involved are not likely to have a material  adverse  impact on its
financial  position or results of  operations.  However,  it is not  possible to
ensure the ultimate outcome of such claims.



                                       29
<PAGE>

     The Company cannot predict with any certainty  whether existing  conditions
or future  events,  such as changes in existing laws and  regulations,  may give
rise to additional environmental costs. Furthermore,  actions by federal, state,
local and foreign governments  concerning  environmental matters could result in
laws or  regulations  that could  increase the cost of producing  the  Company's
products,  or providing its services,  or otherwise  adversely affect the demand
for its products or services.

Recent Accounting Pronouncements

     Effective  for the  quarter  ended  March 31,  2001,  the  Company  will be
required  to adopt SFAS No.  133  "Accounting  for  Derivative  Instruments  and
Hedging  Activities." The Company does not expect that adoption of this standard
will have a material  adverse  impact on the  Company's  financial  position  or
results of operations.


Item 3.  Quantitative and Qualitative Disclosures About Market Risk

      The  Company  is  exposed to market risk from changes in foreign  currency
exchange rates and interest rates,  which could impact its results of operations
and financial condition. The Company manages its exposure to these risks through
its normal  operating and financing  activities  and through the use of interest
rate cap agreements with respect to interest rates. There were no other material
derivative instrument transactions during any of the periods presented.

     The Company has generally  accepted the exposure to exchange rate movements
relative  to its  investment  in foreign  operations  without  using  derivative
financial  instruments  to manage the risk.  As in the case of other  U.S.-based
manufacturers with export sales, local currency  devaluation  increases the cost
of the Company's  bowling equipment in that market. As a result, a strengthening
U.S. dollar  exchange rate may adversely  impact sales volume and profit margins
during  such  periods.  Foreign  currency  exchange  rates can also  affect  the
translation of operating  results from  international  bowling centers.  For the
nine months  ended  September  30,  2000,  revenue  and EBITDA of  international
bowling centers represented 16.6% and 27.9% of consolidated  revenue and EBITDA,
respectively.  For the nine months ended September 30, 1999,  revenue and EBITDA
of  international  bowling centers  represented  17.2% and 29.9% of consolidated
revenue and EBITDA, respectively.

      The  Company  uses  interest rate cap agreements to mitigate the effect of
changes in interest rates on the Company's  variable rate  borrowings  under its
Credit  Agreement.  While the  Company is exposed to credit risk in the event of
non-performance  by the  counterparty to interest rate swap  agreements,  in all
cases such counterparty is a highly-rated  financial institution and the Company
does  not  anticipate  non-performance.  The  Company  does  not  hold or  issue
derivative  financial  instruments  for  trading  purposes or  speculation.  The
following table provides information about the Company's fixed and variable rate
debt,  weighted  average  interest rates and  respective  maturity dates (dollar
amount in millions.)

                           Weighted                 Weighted
                            Average     Variable     Average
                 Fixed     Interest       Rate      Interest
  Maturity     Rate Debt     Rate         Debt         Rate
------------- ------------------------ ----------- ---------------
2000                  $ -           -      $ 12.8        10.65 %
2001                    -           -        83.0        10.89
2002                    -           -       356.0        10.77
2003                    -           -       116.4        11.41
2004                    -           -        46.9        11.57
Thereafter        1,139.7       9.13%           -        N/A
              ------------             -----------

Total            $1,139.7                 $ 615.1
              ============             ===========



     During  December 1999,  March 2000 and September  2000,  Bowling  Worldwide
entered  into three  interest  rate cap  agreements  with  Goldman  Sachs Credit
Partners, L.P. (the "Counterparty") to reduce the interest rate risk of its Bank
Debt.  The table below  summarizes the interest rate cap agreements at September
30, 2000:

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<PAGE>

                                Notional
                                 Amount
     Expiration Date         (in millions)    Cap Rate (a)
--------------------------- ----------------- --------------------
December 31, 2000                    $ 100.0         7.6525 %
April 1, 2001                          200.0         7.7800
October 2, 2001                         15.0         7.5000

------------------------------
(a)  The  cap  rate is the  3-month  U.S.  Dollar-London  Interbank  Offer  Rate
     ("USD-LIBOR") quoted by the Counterparty.

     Bowling  Worldwide  paid a  fixed  fee of  $75,000,  $160,000  and  $7,000,
respectively,  for the three interest rate caps.  Bowling Worldwide will receive
quarterly  payments from the Counterparty if the quoted 3-month USD-LIBOR on the
quarterly floating rate reset dates is above the respective cap rates.


                                       31
<PAGE>

                                     PART II

Item 1. Legal Proceedings

     On April 22, 1999, a putative  class action was filed in the United  States
District  Court for the  Southern  District of New York by Vulcan  International
Corporation against AMF Bowling, The Goldman Sachs Group, L.P., Goldman, Sachs &
Co., Morgan Stanley & Co. Incorporated,  Cowen & Company,  Schroder & Co., Inc.,
Richard A. Friedman and Douglas J. Stanard.  The complaint has subsequently been
amended  to,  among other  things,  include  additional  named  plaintiffs.  The
plaintiffs,  as putative  class  representatives  for all persons who  purchased
Common  Stock in the  Company's  initial  public  offering of Common  Stock (the
"Initial  Public  Offering")  or  within  25 days of the  effective  date of the
registration statement related to the Initial Public Offering, seek, among other
things,  damages and/or rescission  against all defendants jointly and severally
pursuant to  Sections  11, 12 and/or 15 of the  Securities  Act of 1933 based on
allegedly inaccurate and misleading disclosures in connection with and following
the Initial Public Offering.  Management believes that the litigation is without
merit and intends to defend it vigorously.

     In June 1998,  Harbin Hai Heng Bowling  Entertainment Co. Ltd. ("Hai Heng")
filed an  action  against  AMF  Bowling  Products,  Inc.  ("AMF"),  an  indirect
subsidiary  of AMF  Bowling,  in  the  Harbin  Intermediate  People's  Court  in
Heilongjing,  China.  Hai Heng  sought to  recover  $3 to $4  million in damages
relating to 38 NCPs  purchased from AMF. Hai Heng asserted that the poor quality
of the 38 NCPs  entitled Hai Heng to recover the purchase  price and damages for
lost profits and the cost of storing the NCPs.

     On November 6, 1998, the court awarded Hai Heng approximately $3.5 million.
AMF appealed the award to the High People's Court of Heilongjing Province (the
"People's Court"). Prior to completion of the appeal review, the President of
the People's Court on February 11, 1999 issued a judgment in favor of Hai Heng
for approximately $2.8 million and ordered Hai Heng to return 24 NCPs to AMF.
AMF filed an appeal to the Supreme People's Court in Beijing (the "Supreme
Court"). The Supreme Court orally issued a stay of the execution of the
judgment. AMF has been advised that the Supreme Court has declined to review the
case and the judgment is now final.

     On September 21, 2000, the United States Securities and Exchange Commission
("SEC") issued a subpoena to the Company seeking documents concerning the
Company's financial statements and accounting practices and policies. The
Company is in the process of producing documents to the SEC in response to the
subpoena. The Company does not believe at this time that this inquiry by the SEC
will have a material adverse effect on the Company or its financial statements.

     In  addition,  the  Company  currently  and from time to time is subject to
claims and actions  arising in the ordinary  course of its  business,  including
environmental claims,  discrimination claims,  workers' compensation claims, and
personal  injury  claims from  customers of Bowling  Centers.  In some  actions,
plaintiffs  request  punitive  or  other  damages  that  may not be  covered  by
insurance.  In management's opinion, the claims and actions in which the Company
is involved will not have a material adverse impact on its financial position or
results of  operations.  However,  it is not  possible to predict the outcome of
such claims and actions.


Item 6.   Exhibits and Reports on Form 8-K

(a) Exhibits

         10.1     Amendment  No.  1  to  Fourth  Amended  and  Restated   Credit
                  Agreement dated as of August 14, 2000.
         27.1     Financial  Data  Schedule for the nine months ended  September
                  30, 2000.

(b) Reports on Form 8-K:

         A  current  report  was  filed  September  15,  2000 in  which  Bowling
         Worldwide  indicated  that it did  not  make  the  September  15,  2000
         interest  payment  of  approximately  $13.6  million  due on its senior
         subordinated notes.


                                       32
<PAGE>

                                   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.

AMF Bowling, Inc.
(Registrant)


 /s/ Stephen E. Hare                                           November 14, 2000
---------------------------------------------
Stephen E. Hare
Executive Vice President,
Chief Financial Officer and Treasurer
(Principal Financial Officer)


 /s/ Michael P. Bardaro                                        November 14, 2000
---------------------------------------------
Michael P. Bardaro
Senior Vice President, Corporate Controller
and Assistant Secretary
(Principal Accounting Officer)


                                       33