U.S. Securities and Exchange Commission

Washington, D.C. 20549

FORM 10-Q

ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
May 31, 2005
o	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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

For the quarterly period ended

November 30, 2005

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from N/A to N/A

Commission file no. 1-7755

Summa Industries

(Name of registrant as specified in its charter)

Delaware		95-1240978
(State or other jurisdiction of		(I.R.S. employer identification number)
incorporation or organization)

21250 Hawthorne Boulevard, Suite 500, Torrance, California 90503

(Address of principle executive offices, including zip code)

Registrant’s telephone number: (310) 792-7024

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 ý No o

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

Yes o No ý

~~The~~Indicate ~~number~~by ofcheck ~~shares~~mark ofwhether ~~common~~the ~~stock~~registrant ~~outstanding~~is as ofshell ~~July 5,~~company (as ~~2005~~defined ~~was~~in ~~3,955,542~~Rule 12b-2 of the Exchange Act).

Yes o No ý

The number of shares of common stock outstanding as of December 30, 2005 was 3,895,128.

Summa Industries

INDEX

PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements:
Item 1. Financial Statements:
	Condensed Consolidated Balance Sheets (unaudited) - May 31, 2004, August 31, 2004 and May 31, 2005
	Condensed Consolidated Balance Sheets (unaudited) - November 30, 2004, August 31, 2005 and November 30, 2005
	Condensed Consolidated Income Statements (unaudited) - three months and nine months ended May 31, 2004 and May 31, 2005
	Condensed Consolidated Income Statements (unaudited) - three months ended November 30, 2004 and November 30, 2005
	Condensed Consolidated Statements of Cash Flows (unaudited) - nine months ended May 31, 2004 and May 31, 2005
	Consolidated Statement of Stockholders’ Equity (unaudited) - three months ended November 30, 2005
	Condensed Consolidated Statements of Cash Flows (unaudited) - three months ended November 30, 2004 and November 30, 2005
	Notes to Condensed Consolidated Financial Statements (unaudited)
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 3.	Quantitative and Qualitative Disclosure about Market Risk
Item 3. Quantitative and Qualitative Disclosure about Market Risk
Item 4.	Controls and Procedures
Item 4. Controls and Procedures
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings
Item 1A.	Risk Factors
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds
Item 3.	Defaults upon Senior Securities
Item 4.	Submission of Matters to a Vote of Security Holders
Item 5.	Other Information
Item 6.	Exhibits
Signature Page

Summa Industries

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

	May 31, 2004			August 31, 2004			May 31, 2005
	November 30, 2004			August 31, 2005			November 30, 2005
ASSETS
Current assets:
Cash and cash equivalents	$	~~680~~832,000		$	1,~~248~~233,000		$	1712,~~027,~~000
Accounts receivable	1916,~~895~~371,000			1816,~~227~~919,000			1817,~~761~~566,000
Inventories	1315,~~306~~118,000			1412,~~749~~665,000			15,~~638~~210,000
Prepaid expenses and other	34,~~098~~512,000			3,~~782~~471,000			3,~~895~~582,000
Total current assets	36,979,000			38,006,000			39,321,000
Assets held for sale	—			3,641,000			—
Property, plant and equipment	60,859,000			63,842,000			67,450,000
Note receivable	—			—			2,280,000
Less accumulated depreciation	(32,385,000		)	(32,789,000		)	(35,223,000		)
Total current assets	36,833,000			37,929,000			39,350,000
Net property, plant and equipment	28,474,000			31,053,000			32,227,000
Property, plant and equipment	67,152,000			62,629,000			62,630,000
Other assets	2,497,000			1,804,000			1,844,000
Less accumulated depreciation	(34,066,000		)	(33,416,000		)	(33,569,000		)
Goodwill and other intangibles, net	9,321,000			9,254,000			9,050,000
Net property, plant and equipment	33,086,000			29,213,000			29,061,000
Total assets	$	77,271,000		$	80,117,000		$	82,442,000
Other assets	1,840,000			1,454,000			1,448,000
Goodwill and other intangibles, net	9,186,000			8,981,000			8,932,000
Assets held for sale	—			2,458,000			1,994,000
Total assets	$	80,945,000		$	80,035,000		$	80,785,000
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	76,~~365~~543,000		$	98,~~088~~731,000		$	910,~~909~~873,000
Accrued liabilities	56,~~769~~744,000			75,~~429~~774,000			56,~~429~~050,000
Current maturities of long-term debt	12,~~957~~702,000			23,~~195~~069,000			42,~~178~~504,000
Total current liabilities	15,091,000			18,712,000			19,516,000
Liabilities held for sale	—			1,280,000			—
Long-term debt, net of current maturities	30,337,000			28,663,000			29,157,000
Total current liabilities	15,989,000			18,854,000			19,427,000
Other long-term liabilities	2,577,000			2,508,000			2,448,000
Long-term debt, net of current maturities	31,591,000			27,520,000			27,088,000
Total long-term liabilities	32,914,000			31,171,000			31,605,000
Other long-term liabilities	2,500,000			2,441,000			3,035,000
Minority interest in subsidiary	205,000			205,000			155,000
Total long-term liabilities	34,091,000			29,961,000			30,123,000
Minority interest in subsidiary	205,000			132,000			101,000
Stockholders’ equity:
Common stock, par value $.001; 10,000,000 shares authorized; issued and outstanding:
Common stock, par value $.001; 10,000,000 shares authorized; issued and outstanding: 4,002,527 at November 30, 2004, 3,940,041 at August 31, 2005 and 3,920,226 at November 30, 2005	15,566,000			15,046,000			14,912,000
3,934,702 at May 31, 2004, 3,974,187 at August 31, 2004 and 3,970,757 at May 31, 2005	15,035,000			15,305,000			15,288,000
Retained earnings	15,094,000			16,042,000			16,222,000
Retained earnings	14,026,000			14,724,000			15,878,000
Total stockholders’ equity	30,660,000			31,088,000			31,134,000
Total stockholders’ equity	29,061,000			30,029,000			31,166,000
Total liabilities and stockholders’ equity	$	80,945,000		$	80,035,000		$	80,785,000
Total liabilities and stockholders’ equity	$	77,271,000		$	80,117,000		$	82,442,000

See accompanying notes to condensed consolidated financial statements.

Summa Industries

CONDENSED CONSOLIDATED INCOME STATEMENTS

(unaudited)

	Three months ended May 31						Nine months ended May 31
	Three months ended November 30
	2004			2005			~~2004~~		~~2005~~
Net sales	$	3325,~~160~~488,000		$	3127,~~541~~740,000		$	~~85,631,000~~	$	~~88,976,000~~
Cost of sales	2519,~~096~~044,000			2420,~~980~~956,000			~~64,907,000~~		~~70,183,000~~
Gross profit	86,~~064~~444,000			6,~~561~~784,000			~~20,724,000~~		~~18,793,000~~
Selling, general, administrative and other expenses	54,~~609~~781,000			54,~~316~~973,000			~~15,467,000~~		~~15,363,000~~
Operating income	2,455,000			1,245,000			5,257,000		3,430,000
(Gain) on sale of real estate	(43,000		)	(205,000		)
Interest expense	321,000			476,000			1,210,000		1,314,000
Operating income	1,706,000			2,016,000
Income before income taxes and minority interest	2,134,000			769,000			4,047,000		2,116,000
Interest expense	309,000			448,000
Provision for income taxes	744,000			278,000			1,374,000		772,000
Income from continuing operations before income taxes and minority interest	1,397,000			1,568,000
Income before minority interest	1,390,000			491,000			2,673,000		1,344,000
Provision for income taxes	495,000			561,000
Minority interest in net (loss) of subsidiary	—			(17,000		)	—		(50,000		)
Income from continuing operations before minority interest	902,000			1,007,000
Net income	$	1,390,000		$	508,000		$	2,673,000	$	1,394,000
Minority interest in net loss of subsidiary	—			31,000
Preferred stock accretion	$	81,000		—			$	450,000	—
Income from continuing operations	902,000			1,038,000
Net income available to common stockholders	$	1,309,000		$	508,000		$	2,223,000	$	1,394,000
(Loss) from discontinued operations, net of tax benefit of $145,000 and $199,000	(292,000		)	(387,000		)
Earnings per common share
Net income	$	610,000		$	651,000
Basic	$	0.31		$	0.13		$	0.52	$	0.35
Earnings (loss) per common share
Diluted	$	0.30		$	0.13		$	0.51	$	0.34
Basic
Weighted average common shares outstanding:
Continuing operations	$	.22		$	.26
Basic	4,234,000			3,984,000			4,297,000		3,990,000
Discontinued operations	$	(.07	)	$	(.10	)
Diluted	4,310,000			4,038,000			4,372,000		4,060,000
Net income	$	.15		$	.16
Diluted	$	.22		$	.26
Continuing operations	$	(.07	)	$	(.10	)
Discontinued operations	$	.15		$	.16
Net income
Weighted average common shares outstanding:
Basic	3,984,000			3,927,000
Diluted	4,064,000			3,961,000

See accompanying notes to condensed consolidated financial statements.

Summa Industries

~~CONDENSED~~ CONSOLIDATED STATEMENT ~~STATEMENTS~~ OF ~~CASH~~STOCKHOLDERS’ ~~FLOWS~~EQUITY

for the three months ended November 30, 2005

(unaudited)

	Nine months ended			Nine months ended
	Common		Common			Retained
	May 31, 2004			May 31, 2005
	Shares		Stock			Earnings			Total
Operating activities:
Balance at August 31, 2005	3,940,041		$	15,046,000		$	16,042,000		$	31,088,000
Net income	$	2,673,000		$	1,394,000
Exercise of stock options, including tax benefit of $3,000	2,500		15,000			—			15,000
Adjustments to reconcile net income to net cash provided by operating activities:
Repurchase of common stock	(22,315	)	(173,000		)	—			(173,000		)
Depreciation	3,574,000			3,887,000
Net income	—		—			651,000			651,000
Amortization	181,000			204,000
Stock-based compensation	—		24,000			—			24,000
(Gain) on disposition of property, plant and equipment	(7,000		)	(33,000		)
Payment of dividends	—		—			(236,000		)	(236,000		)
Minority interest in net loss of subsidiary	—			(50,000		)
Dividends declared	—		—			(235,000		)	(235,000		)
Net changes in assets and liabilities, net of effects of acquisitions:
Balance at November 30, 2005	3,920,226		$	14,912,000		$	16,222,000		$	31,134,000
Accounts receivable	(4,166,000		)	(534,000		)
Inventories	(796,000		)	(889,000		)
Prepaid expenses and other assets	(323,000		)	(153,000		)
Accounts payable	2,063,000			821,000
Accrued liabilities	953,000			(1,799,000		)
Total adjustments	1,479,000			1,454,000
Net cash provided by operating activities	4,152,000			2,848,000
Investing activities:
Acquisition of business	(1,903,000		)	—
Purchases of property and equipment	(4,510,000		)	(6,166,000		)
Proceeds from sale of property and equipment	17,000			1,138,000
Net cash (used in) investing activities	(6,396,000		)	(5,028,000		)
Financing activities:
Net proceeds from line of credit	9,818,000			481,000
Proceeds from issuance of long-term debt	5,561,000			6,231,000
Payments on long-term debt	(13,386,000		)	(4,235,000		)
Proceeds from the exercise of stock options	586,000			—
Purchase of common stock	(35,000		)	(278,000		)
Payment of cash dividends	—			(240,000		)
Net cash provided by financing activities	2,544,000			1,959,000
Net increase (decrease) in cash and cash equivalents	300,000			(221,000		)
Cash and cash equivalents, beginning of period	380,000			1,248,000
Cash and cash equivalents, end of period	$	680,000		$	1,027,000

See accompanying notes to condensed consolidated financial statements.

Summa Industries

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

	Three months ended			Three months ended
	November 30, 2004			November 30, 2005
Operating activities:
Net income	$	610,000		$	651,000
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation	1,277,000			1,202,000
Amortization	68,000			49,000
(Gain) on disposition of property, plant and equipment	(43,000		)	(272,000		)
Minority interest in net loss of subsidiary	—			(31,000		)
Stock based compensation	—			24,000
Net changes in assets and liabilities:
Accounts receivable	1,856,000			(647,000		)
Inventories	(369,000		)	(2,545,000		)
Prepaid expenses and other assets	(766,000		)	(324,000		)
Accounts payable	(2,545,000		)	2,142,000
Accrued liabilities	(672,000		)	635,000
Total adjustments	(1,194,000		)	233,000
Net cash provided by (used in) operating activities	(584,000		)	884,000
Investing activities:
Purchases of property and equipment	(3,310,000		)	(1,086,000		)
Proceeds from sale of property and equipment	43,000			772,000
Proceeds from sale of discontinued operations	—			300,000
Net cash (used in) investing activities	(3,267,000		)	(14,000		)
Financing activities:
Net proceeds from (payments on) line of credit	1,743,000			(1,046,000		)
Proceeds from issuance of long-term debt	2,229,000			2,952,000
Payments on long-term debt	(537,000		)	(2,903,000		)
Proceeds from the exercise of stock options	—			15,000
Purchase of common stock	—			(173,000		)
Payment of cash dividends	—			(236,000		)
Net cash provided by (used in) financing activities	3,435,000			(1,391,000		)
Net (decrease) in cash and cash equivalents	(416,000		)	(521,000		)
Cash and cash equivalents, beginning of period	1,248,000			1,233,000
Cash and cash equivalents, end of period	$	832,000		$	712,000

See accompanying notes to condensed consolidated financial statements.

Summa Industries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

~~May~~November 3130, 2005

1. Basis of presentation

The accompanying ~~unaudited~~ unaudited condensed consolidated financial statements of Summa Industries (the “Company”) have been condensed in certain respects and should, therefore, be read in conjunction with the audited consolidated financial statements and notes related thereto contained in the Company’s Annual Report on Form 10-K for the year ended August 31, ~~2004~~2005. In the opinion of the Company, these financial statements contain all adjustments necessary for a fair presentation for the interim period, all of which were normal recurring adjustments. The results of operations for the three months ~~and nine months~~ ended ~~May~~November 3130, 2005 are not necessarily indicative of the results to be expected for the full year ending August 31, ~~2005~~ 2006.

Recent accounting pronouncements

In December 2004, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards ~~No. 123R~~ (“SFAS”) No. 123R”), “Share-Based Payments,” which requires companies to recognize in the income statement the grant-date fair value of stock options and equity-based compensation issued to employees. ~~The~~Prior to its adoption, the Company ~~reports~~reported equity based compensation in accordance with Accounting Principles Board (“APB”) Opinion No. 25 and ~~Financial~~ Financial Interpretation No. 44, and accordingly, no compensation expense is was recognized in the financial statements prior to September 1, 2005. The pro forma effect of equity-based compensation under SFAS No. 123, “Accounting for Stock-Based Compensation,” is ~~disclosed~~for inthe ~~Note~~period 4prior ~~below. The Company~~to ~~will~~the ~~adopt~~adoption ~~this~~of ~~statement~~SFAS No, 123R ~~effective~~and ~~with~~the ~~its~~expense ~~fiscal~~charged ~~year~~to ~~beginning~~earnings ~~September 1, 2006. The~~since ~~Company~~its isadoption ~~currently evaluating~~are ~~the~~disclosed ~~impact~~in Note of5, ~~adopting this standard~~below.

In November 2004, ~~the~~ the FASB issued ~~Statement of Financial Accounting Standards No. 151 (“~~SFAS No. 151”), “Inventory Costs-an amendment of Accounting Research Bulletin (“ARB”) 43, Chapter 4.” This statement amends the guidance in ARB No. 43, Chapter 4, “Inventory Pricing,” to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs and wasted material. This statement requires that those items be ~~recognized~~ recognized as current period charges. In addition, this statement requires that allocation of fixed production overhead to the costs of conversion be based on the normal capacity of the production facilities. The ~~Company~~adoption ~~will~~of ~~adopt~~SFAS ~~this~~No. 151 ~~statement,~~ effective ~~with its fiscal year beginning~~ September 1, 2005~~. The~~, ~~Company~~did isnot ~~currently evaluating~~have ~~the~~an ~~effect~~impact ~~of the adoption of this statement~~ on the Company’s financial position, results of operations ~~and~~or ~~financial~~cash ~~position~~flow.

In October 2005, the FASB issued Staff Position Financial Accounting Standard (“FAS”)13-1, “Accounting for Rental Costs Incurred during a Construction Period,” which requires rental costs associated with ground or building operating leases that are incurred during a construction period to be recognized as rental expense. This Staff Position is effective for reporting periods beginning after December 15, 2005, and retrospective application is permitted but not required. The adoption of this statement is not expected to have any significant effect on the Company’s results of operations or financial position.

In June 2005, the FASB issued SFAS No. 154, “Accounting Changes and Error Corrections, a replacement of APB No. 20 and FAS No.3”. . SFAS No. 154 provides guidance on the accounting for and reporting of accounting changes and error calculations. It establishes, unless impracticable, retrospective application as the required method for reporting a change in accounting principle in the absence of explicit transition requirements specific to the newly adopted accounting principle. SFAS No. 154 also provides guidance for determining whether retrospective application is impracticable. The correction of an error in previously issued financial statements is not an accounting change. However, the reporting of an error correction involves adjustments to previously issued financial statements similar to those generally applicable to reporting an accounting change retrospectively. Therefore, the reporting of a correction of an error by restating previously issued financial statements is also addressed by SFAS No. 154. SFAS No. 154 is required to be adopted for reporting periods beginning after December 15, 2005. The Company does not believe its adoption will have a material impact on its consolidated results of operations or financial position.

2. Inventories

Inventories were as follows:

	May 31, 2004		August 31, 2004		May 31, 2005
	November 30, 2004		August 31, 2005		November 30, 2005
Finished goods	$	56,~~613~~771,000	$	6,~~407~~097,000	$	7,~~600~~394,000
Work in process	~~587~~292,000		~~296~~199,000		~~207~~262,000
Materials and parts	78,~~106~~055,000		86,~~046~~369,000		7,~~831~~554,000
	$	1315,~~306~~118,000	$	1412,~~749~~665,000	$	15,~~638~~210,000

3. ~~Earnings~~ Assets held ~~per~~for ~~share~~sale

~~Basic earnings per share (“EPS”) was computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during each period.~~ The ~~Company~~book ~~had~~values ~~5,000 shares~~ of ~~redeemable~~ ~~convertible~~assets ~~preferred~~held ~~stock outstanding until its repurchase on May 3, 2004, which provided~~ for ansale ~~accretion in its redemption price. This accretion reduced the net income available to common stockholders used in the EPS calculation prior to that date.~~were:

Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. Diluted EPS was calculated using the “treasury stock” method as if dilutive options had been exercised and the funds were used to purchase common shares at the average market price during the period. Options to purchase 518,000 common shares as of May 31, 2004 and 773,000 common shares as of May 31, 2005

	August 31, 2005		November 30, 2005

Vacant real estate	$	2,373,000	$	1,961,000
Machinery & equipment	85,000		33,000
Working capital of discontinued operations	2,361,000		—

Total assets held for sale	$	4,819,000	$	1,994,000

The working capital of discontinued operations at August 31, 2005 was net of liabilities held for sale of $1,280,000. See Note 6 below.

~~were excluded from the calculation of equivalent shares, as they would have been anti-dilutive~~4. ~~The 5,000 shares of~~ Earnings ~~outstanding~~per preferred stock, convertible into 625,000 shares of common stock, were excluded from the calculation of equivalent shares for the three month and nine month periods ended May 31, 2004, as they would have been anti-dilutive.share

Basic earnings per share (“EPS”) was computed by dividing net income by the weighted average number of common shares outstanding during each period.

Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. Diluted EPS was calculated using the “treasury stock” method as if dilutive options had been exercised and the funds were used to purchase common shares at the average market price during the period. Options to purchase 590,000 common shares as of November 30, 2004 and 796,000 common shares as of November 30, 2005 were excluded from the calculation of equivalent shares, as they would have been anti-dilutive.

The following is a reconciliation of the numerators and denominators of the basic and diluted EPS computations for “income available to common stockholders” and other disclosures required by FASB Statement of Accounting Standards No. 128, “Earnings per Share”:

	Three months ended May 31					Nine months ended May 31
	Three months ended November 30
	2004			2005		~~2004~~			~~2005~~
Numerators:
Net Income	$	1610,~~390,~~000		$	~~508~~651,000	$	~~2,673,000~~		$	~~1,394,000~~
Preferred stock accretion	(81,000		)	—		(450,000		)	—
Denominators:
Income available to common stockholders	$	1,309,000		$	508,000	$	2,223,000		$	1,394,000
Weighted average shares outstanding – basic	3,984,000			3,927,000
Denominators:
Impact of common shares assumed to be issued under stock option plans	80,000			34,000
Weighted average shares outstanding – basic	4,234,000			3,984,000		4,297,000			3,990,000
Weighted average shares outstanding – diluted	4,064,000			3,961,000
Impact of common shares assumed to be issued under stock option plans	76,000			54,000		75,000			70,000
Weighted average shares outstanding – diluted	4,310,000			4,038,000		4,372,000			4,060,000

45. Stock-based compensation ~~plans~~

~~The~~Effective ~~Company~~September 1, ~~accounts~~2005, ~~for stock options issued to employees and directors in accordance with~~ the ~~recognition~~Company ~~and~~adopted ~~measurement~~SFAS ~~principles of Accounting Principles Board Opinion~~ No. ~~25 and Financial Interpretation No. 44. Consequently~~123R, ~~no compensation expense was recognized for the Company’s stock~~ ~~option~~“Share-Based ~~plans.~~Payment,” ~~The~~which ~~following table illustrates the effect on net earnings and~~revised ~~net~~SFAS ~~earnings per share if the Company had applied the fair value recognition provisions of Statement of Financial Accounting Standards~~ No. 123, “Accounting for Stock-Based Compensation”., ~~The~~and ~~fair~~superseded Accounting ~~value~~Principals ~~estimate~~Board ~~was~~Opinion ~~computed~~(“APB”) ~~using the Black-Scholes option pricing model~~No. 25

	Three months ended May 31						Nine months ended May 31
	2004			2005			2004			2005
Income available to stockholders	$	1,309,000		$	508,000		$	2,223,000		$	1,394,000
Share-based compensation included in income available to stockholders	—			—			—			—
Pro forma impact of expensing stock options	(57,000		)	(41,000		)	(78,000		)	(35,000		)
Pro forma income available to common stockholders	$	1,252,000		$	467,000		$	2,145,000		$	1,359,000
Earnings per share:
As reported:
Basic	$	0.31		$	0.13		$	0.52		$	0.35
Diluted	$	0.30		$	0.13		$	0.51		$	0.34
Pro forma:
Basic	$	0.30		$	0.12		$	0.50		$	0.34
Diluted	$	0.29		$	0.12		$	0.49		$	0.33

5. Supplemental cash flow information

	Nine months ended
	2004		2005
Cash paid during the period:
Interest	$	1,254,000	$	1,312,000
Income taxes	$	820,000	$	1,559,000
Non-cash financing activity:
Common stock issued to 401(k) Plan	$	345,000	$	261,000
Accretion of redeemable preferred stock	$	450,000	—
Issuance of subordinated debt for repurchase of:
Preferred stock	$	6,553,000	—
Common stock	$	3,633,000	—
Minority interest in subsidiary given as
partial consideration for land and building	$	205,000	—

6. Segment information

The Company has four reportable segments identified by differences in products and distribution channels. The accounting policies of the segments are the same as those described in the summary of significant accounting polices described in the Company’s Annual Report on Form 10-K for the year ended August 31, 2004. The Company’s operations are reported in the following business segments:

Optical Components. In its Optical Components segment, Summa designs and manufactures plastic prismatic lenses, reflectors and diffusers and other plastic products, which are used in commercial and industrial lighting fixtures, display, signage, architectural and other applications.

Material Handling Components. In its Material Handling Components segment, Summa designs and manufactures engineered plastic components, which form conveyer belts and chains and other plastic products for use in food processing.

Irrigation Components. In its Irrigation Components segment, Summa designs and manufactures plastic injection-molded fittings, valves, filters and accessories, extruded tubing and other plastic products for drip irrigation systems used in agriculture, commercial landscape and other applications.

Electrical Components. In its Electrical Components segment, Summa designs and manufactures thermoplastic coil forms or “bobbins” and other plastic products used principally in the manufacture of magnetic devices such as transformers, relays, switches, power supplies and small electric motors.

~~Financial~~“Accounting ~~information~~for byStock ~~reportable~~Issued ~~business~~to ~~segment~~Employees”, and isits ~~reported~~related interpretations. SFAS 123R requires that new, modified and unvested share-based payment transactions with employees, such as stock options, be recognized in the financial ~~following~~statements ~~tables:~~based on their fair value and recognized as compensation expense over the vesting period. The Company has elected to use the modified prospective method, under which previously reported financial results are not restated to reflect the stock-based compensation formerly recognized in the required pro forma footnote disclosures.

	Three months ended May 31						Nine months ended May 31
	2004			2005			2004			2005
External sales
Optical components	$	14,694,000		$	13,151,000		$	41,000,000		$	41,019,000
Material handling components	7,120,000			7,259,000			19,524,000			19,874,000
Irrigation components	8,005,000			8,398,000			16,046,000			20,089,000
Electrical components	3,341,000			2,733,000			9,061,000			7,994,000
Other	—			—			—			—
Consolidated	$	33,160,000		$	31,541,000		$	85,631,000		$	88,976,000
Inter-segment sales
Optical components	$	935,000		$	32,000		$	2,059,000		$	341,000
Material handling components	—			—			—			—
Irrigation components	26,000			—			673,000			—
Electrical components	—			—			—			—
Other	(961,000		)	(32,000		)	(2,732,000		)	(341,000		)
Consolidated	$	—		$	—		$	—		$	—
Total sales
Optical components	$	15,629,000		$	13,183,000		$	43,059,000		$	41,360,000
Material handling components	7,120,000			7,259,000			19,524,000			19,874,000
Irrigation components	8,031,000			8,398,000			16,719,000			20,089,000
Electrical components	3,341,000			2,733,000			9,061,000			7,994,000
Other	(961,000		)	(32,000		)	(2,732,000		)	(341,000		)
Consolidated	$	33,160,000		$	31,541,000		$	85,631,000		$	88,976,000
Operating income (loss)
Optical components	$	2,382,000		$	808,000		$	5,652,000		$	3,318,000
Material handling components	398,000			976,000			909,000			2,056,000
Irrigation components	394,000			579,000			174,000			997,000
Electrical components	(29,000		)	(497,000		)	95,000			(1,384,000		)
Other	(690,000		)	(621,000		)	(1,573,000		)	(1,557,000		)
Consolidated	$	2,455,000		$	1,245,000		$	5,257,000		$	3,430,000

The Company deemed it to be in the best interests of the Company and its stockholders to minimize the compensation expense that would be required to be recognized under SFAS No. 123R for “out-of -the-money” or “underwater” stock options. Consequently, in the fiscal year ended August 31, 2005, the Company accelerated the vesting of most of the then outstanding stock options that contained exercise prices greater than the market trading price at that time. As a result of this early vesting, employee compensation expense of $380,000, net of tax, was recognized in the pro forma footnote disclosure for the year ended August 31, 2005 and will not be recognized in the reported results of operations in the periods following the adoption of SFAS No. 123R.

	May 31, 2004		Aug 31, 2004		May 31, 2005
Assets
Optical components	$	29,472,000	$	30,183,000	$	28,844,000
Material handling components	18,447,000		20,069,000		22,394,000
Irrigation components	14,040,000		13,622,000		15,473,000
Electrical components	9,655,000		10,453,000		9,839,000
Other	5,657,000		5,790,000		5,892,000
Consolidated	$	77,271,000	$	80,117,000	$	82,442,000

As a result of adopting SFAS 123R, the Company recognized compensation expense for stock options in the three-month period ended November 30, 2005 of $15,000, net of tax benefit. Prior to the adoption of SFAS 123R, the Company applied the provisions of APB No. 25 and Financial Interpretation No. 44. Consequently, no compensation expense was recognized for stock options in the three-month period ended November 30, 2004.

The following table illustrates the effect on net earnings and net earnings per share if the Company had applied the fair value recognition provisions of SFAS No. 123 as of September 1, 2004. The fair value estimate was computed using the Black-Scholes option pricing model.

	Three months ended November 30, 2004

Net income	$	610,000
Share-based compensation included in net income	—
Pro forma impact of expensing stock options	(32,000		)
Pro forma net income	$	578,000

Earnings per share:

As reported:
Basic	$	0.15
Diluted	$	0.15

Pro forma:
Basic	$	0.15
Diluted	$	0.14

6. Discontinued operations

As previously disclosed, in September 2005, the Company sold certain assets and liabilities of its former Electrical Components segment at their book value to an investor group for $300,000 cash and a $2,280,000 note due in August 2006, and leased related equipment and facilities to the investor group for five years. Additional assets, principally real estate located in Illinois, are reported in assets held for sale. The financial results of Plastron, which were formerly reported as the Electrical Components segment, have been excluded from results of operations for the periods presented herein and have been presented as a discontinued operation.

~~In the fourth quarter of fiscal 2004, all of the assets and operations of the former Miscellaneous Plastic Components segment were integrated with the Irrigation Components segment~~7. ~~Prior period segment information has been~~ Supplemental ~~restated~~cash toflow ~~conform to the consolidation. Segment~~ information ~~as reported prior to the consolidation is as follows for the periods ended May 31, 2004:~~

	Three months					Nine months
	Three months ended November 30
External sales:
	2004			2005
Irrigation Components	$	7,916,000				$	15,432,000
Cash paid during the period:
Miscellaneous Plastic Components	89,000					614,000
Interest	$	387,000		$	509,000
Total	$	8,005,000				$	16,046,000
Income taxes	$	550,000		$	99,000
Inter-segment sales:
Non-cash financing activity:
Irrigation Components	$	—				$	—
Common stock issued to 401(k) Plan	$	261,000		$	—
Miscellaneous Plastic Components	233,000					1,482,000
Dividend declared	$	(240,000	)	$	(235,000	)
Total	$	233,000				$	1,482,000
Non-cash investing activity:
Total sales:
The Company received a note receivable of $2,280,000 in September 2005 as partial consideration for the sale of certain assets of Plastron Industries, Inc.
Irrigation Components	$	7,916,000				$	15,432,000
Miscellaneous Plastic Components	322,000					2,096,000
Total	$	8,238,000				$	17,528,000
Operating income (loss):
Irrigation Components	$	665,000				$	999,000
Miscellaneous Plastic Components	(271,000				)	(825,000		)
Total	$	394,000				$	174,000
Assets at May 31, 2004:
Irrigation Components			$	13,995,000
Miscellaneous Plastic Components			45,000
Total			$	14,040,000

~~Interest expense and income taxes are not shown in the preceding tables, as they are not fully allocated by segment~~8. ~~“Other” includes inter-company eliminations~~ Segment ~~and corporate and other expenses not allocated by segment.~~information

~~MANAGEMENT~~The Company has three reportable segments identified by differences in products and distribution channels. The accounting policies of the segments are the same as those described in the summary of significant accounting polices described in the Company’Ss ~~DISCUSSION~~Annual ~~AND~~Report ~~ANALYSIS~~on OFForm 10-K for ~~FINANCIAL~~the year ended August 31, 2005. ~~CONDITION~~The ~~AND~~Company’s ~~RESULTS~~operations OFare ~~OPERATIONS~~reported in the following business segments:

~~Statements~~Optical ~~contained~~Components. In inits ~~this Quarterly~~Optical ~~Report~~Components ~~on Form 10-Q~~segment, ~~which are not purely historical, are~~Summa ~~forward-looking~~designs ~~statements within the meaning of Section 27A of the Securities Act of 1933~~ and ~~Section 21E~~manufactures ofplastic ~~the~~prismatic ~~Securities Exchange Act of 1934~~lenses, ~~including~~reflectors but not limited to statements regarding Summa’s expectations, hopes, beliefs, intentions or strategies regarding the future, such as those set forth in Part II, Item 1 “Legal Proceedings” below. Actual results could differ materially from those projected in any forward-looking statements as a result of a number of factors, including those detailed in this “Management’s Discussion and ~~Analysis” section and~~diffusers ~~elsewhere herein~~ and ~~in the Company’s Annual Report on Form 10-K~~ ~~for~~other ~~the~~plastic ~~fiscal year ended August 31~~products, ~~2004. The~~which ~~forward-looking statements~~ are ~~made~~used ~~as of the date hereof, and the Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ materially from those projected~~ in ~~the~~commercial ~~forward-looking statements. For a discussion of risks~~ and ~~uncertainties~~industrial ~~that should be considered~~lighting ~~and~~fixtures ~~which could materially adversely affect the Company, please see “Risk Factors” in the “Management Discussion~~ and ~~Analysis”~~other ~~section of the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2004~~applications.

~~Summa~~Material ~~manufactures~~Handling ~~plastic products for diverse commercial and industrial markets~~Components. In ~~Through~~ its ~~four~~Material Handling ~~reportable~~Components ~~segments~~segment, Summa designs and manufactures ~~injection-molded~~engineered ~~and formed~~ plastic ~~optical~~ components, ~~for~~which ~~OEM customers~~form inconveyer ~~the~~belts ~~lighting industry; modular plastic conveyor belt~~ and ~~chain~~chains ~~for the food processing industry; engineered plastic fittings, valves, filters~~ and ~~tubing~~ ~~for irrigation systems used in agriculture, commercial landscape and~~ other ~~applications; molded~~ plastic ~~coil~~products ~~forms (“bobbins”)~~ for use in ~~transformers,~~ ~~motors,~~food ~~relays and switches; and other molded and extruded plastic components for diverse industries~~processing.

Irrigation Components. In its Irrigation Components segment, Summa designs and manufactures plastic injection-molded fittings, micro-sprinklers, emitters, valves, filters and accessories, extruded tubing and other plastic products for drip irrigation systems used in agriculture, commercial landscape and other applications.

Formerly, the Company also operated in an Electrical Components segment which was discontinued in the first quarter of fiscal 2006 and has been reported as discontinued operations at August 31, 2005 and for the period ended November 30, 2005.

~~Results~~Financial ofinformation ~~Operations~~by reportable business segment follows:

During the nine month period ended May 31, 2005, the Company experienced unusually high expenses directly related to two major relocation initiatives: the consolidation of three plants in the Material Handling Components segment to a new facility in Reading, PA, which was substantially completed during the second quarter, and an ongoing relocation in the Electrical Components segment from Bensenville, Illinois to Pharr, Texas. The Pharr relocation is expected to be completed in the fourth quarter of fiscal 2005. The relocation costs, which are shown in the following table, are expected to decline sharply in the fourth quarter fiscal 2005. The expenses consisted primarily of duplicate personnel and facility costs, costs to develop and implement a new manufacturing process and costs to move inventory and equipment. In connection with the relocation in the Electrical Components segment, excess real estate and equipment was sold for a net gain of $118,000, and the segment’s remaining facilities in Bensenville have been listed for sale. The effects of the relocation expenses and the pro forma earnings, calculated as though the relocation expenses had not been incurred, are as follows:

	Three months ended November 30
	2004			2005

External sales
Optical components	$	14,150,000		$	14,523,000
Material handling components	6,409,000			6,525,000
Irrigation components	4,929,000			6,692,000
Consolidated	$	25,488,000		$	27,740,000

Inter-segment sales
Optical components	$	291,000		$	—
Material handling components	—			—
Irrigation components	—			—
Other	(291,000		)	—
Consolidated	$	—		$	—

Total sales
Optical components	$	14,441,000		$	14,523,000
Material handling components	6,409,000			6,525,000
Irrigation components	4,929,000			6,692,000
Other	(291,000		)	—
Consolidated	$	25,488,000		$	27,740,000

Operating income (loss)
Optical components	$	1,282,000		$	1,804,000
Material handling components	710,000			723,000
Irrigation components	163,000			163,000
Other	(449,000		)	(674,000		)
Consolidated	$	1,706,000		$	2,016,000

	Three months ended May 31				Nine months ended May 31
	November 30, 2004		August 31, 2005		November 30, 2005
	2004		2005		2004		2005
Assets
Operating income	$	2,455,000	$	1,245,000	$	5,257,000	$	3,430,000
Optical components	$	28,995,000	$	28,668,000	$	30,127,000
Relocation expenses	187,000		497,000		316,000		1,511,000
Material handling components	21,781,000		23,270,000		23,587,000
Gain on sale of real estate and equipment	—		—		—		(118,000		)
Irrigation components	13,709,000		13,046,000		14,002,000
Pro forma operating income	$	2,642,000	$	1,742,000	$	5,573,000	$	4,823,000
Assets held for sale	—		6,099,000		1,994,000
Net income	$	1,390,000	$	508,000	$	2,673,000	$	1,394,000
Other	16,460,000		8,952,000		11,075,000
Tax-effected relocation expenses	120,000		318,000		202,000		967,000
Consolidated	$	80,945,000	$	80,035,000	$	80,785,000
Tax-effected gain on real estate and equipment	—		—		—		(76,000		)
Pro forma net income	$	1,510,000	$	826,000	$	2,875,000	$	2,285,000

~~Note~~Interest ~~that~~expense ~~“pro~~and ~~forma”~~income ~~has~~taxes noare ~~defined~~not ~~meaning~~shown ~~under~~in ~~Generally Accepted Accounting Principles. The information presented above is for~~ the ~~purpose~~preceding oftable, ~~drawing~~as ~~attention~~they toare anot fully ~~critical~~allocated ~~component~~by ~~of current performance~~segment. ~~There~~“Other” includes ~~are~~inter-company ~~other components~~eliminations, ofcorporate ~~current~~and ~~performance~~other ~~that~~expenses ~~are~~and assets not ~~highlighted~~allocated inby ~~the foregoing presentation~~segment.

~~The following table sets forth certain information, derived from Summa~~MANAGEMENT’sS ~~unaudited~~DISCUSSION ~~condensed consolidated~~AND ~~statements~~ANALYSIS ~~of income, as a percent of sales for the three month~~OF ~~and~~FINANCIAL ~~nine~~CONDITION ~~month~~AND ~~periods~~RESULTS ~~ended~~OF ~~May 31, 2004 and May 31, 2005, and the Company’s effective income tax rate during those periods:~~OPERATIONS

	Three months ended May 31				Nine months ended May 31
	2004		2005		2004		2005
Net sales	100.0	%	100.0	%	100.0	%	100.0	%
Cost of sales	75.7	%	79.2	%	75.8	%	78.9	%
Gross profit	24.3	%	20.8	%	24.2	%	21.1	%
S,G & A and other expenses	16.9	%	16.9	%	18.1	%	17.2	%
Operating income	7.4	%	3.9	%	6.1	%	3.9	%
Interest expense, net	1.0	%	1.5	%	1.4	%	1.5	%
Income before tax and minority interest	6.4	%	2.4	%	4.7	%	2.4	%
Effective tax rate	34.9	%	35.4	%	34.0	%	35.6	%

Statements contained in this Quarterly Report on Form 10-Q, which are not purely historical, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including but not limited to statements regarding Summa’s expectations, hopes, beliefs, intentions or strategies regarding the future, such as those set forth in Part II, Item 1 “Legal Proceedings” below. Actual results could differ materially from those projected in any forward-looking statements as a result of a number of factors, including those detailed in this “Management’s Discussion and Analysis” section and elsewhere herein and in the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2005. The forward-looking statements are made as of the date hereof, and the Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ materially from those projected in the forward-looking statements. For a discussion of risks and

~~Quarter~~uncertainties that ~~ended~~should ~~May 31~~be considered and which could materially adversely affect the Company, please ~~2005~~see ~~compared~~“Risk toFactors” in the ~~quarter~~“Management Discussion and Analysis” section of the Company’s Annual Report on Form 10-K for the fiscal year ended ~~May~~August 31, ~~2004~~ 2005.

~~Sales~~Summa ~~for~~manufactures ~~the~~plastic ~~third~~products ~~quarter~~for ~~ended~~diverse ~~May 31,~~commercial ~~2005~~and ~~decreased~~industrial ~~$1,619,000,~~markets. orThrough ~~5%,~~its ~~primarily~~three ~~due~~reportable ~~to weakness~~segments, inSumma ~~sales~~designs inand ~~the~~manufactures ~~Optical~~injection-molded ~~Components segment~~ and ~~the~~formed ~~transfer~~plastic ~~of business to~~optical ~~China~~components ~~(approximately~~for ~~$500,000)~~OEM ~~partially~~customers ~~offset~~in by the ~~effects~~lighting ofindustry; ~~price increases~~modular ~~(approximately~~plastic ~~$1,200,000).~~ conveyor ~~Sales~~belt ~~decreased~~and ~~11%~~chain infor the ~~Optical~~food ~~Components~~processing ~~segment,~~industry; ~~primarily~~engineered ~~due~~plastic tofittings, ~~softness in demand for high~~micro-~~bay~~sprinklers, ~~high intensity lighting products~~emitters, ~~and transfer of business to China~~valves, ~~partially~~filters ~~offset~~and bytubing ~~price~~for ~~increases;~~irrigation ~~increased 2% in the~~systems ~~Material~~used ~~Handling Components segment, due to price increases; increased 5%~~ in ~~the~~ ~~Irrigation Components segment~~agriculture, ~~primarily~~commercial ~~due~~landscape toand ~~price~~other ~~increases,~~applications; and ~~decreased~~ ~~18% in the Electrical Components segment, despite price increases,~~other ~~primarily~~molded ~~due to transfer of business to China~~ and ~~disruptions~~extruded ~~related~~plastic tocomponents ~~a plant~~for ~~relocation~~diverse industries.

~~Gross~~Significant ~~profit~~events ~~for~~and ~~the~~developments ~~third quarter decreased $1,503,000, or 19%, from~~during the ~~comparable~~first ~~prior~~quarter ~~year period, primarily due to increased material costs, increased business relocation expense and the effects~~ of ~~lower~~fiscal ~~sales volume~~2006, ~~partially~~ ~~offset~~ended byNovember 30 ~~the effects of higher prices. Gross margin decreased from 24.3% to 20.8%, primarily due to increased relocation expenses.~~2005

~~Operating~~During ~~expenses~~the ~~for~~quarter, plastic resin, the principal ~~third~~raw ~~quarter~~material ~~decreased~~used ~~$293,000,~~by orthe 5%Company, ~~from~~ ~~the~~experienced ~~comparable~~extreme ~~prior~~price ~~year~~inflation and ~~period~~volatility, ~~primarily~~as ~~due~~a toresult ~~lower~~of ~~variable~~a ~~expense~~number of factors including petrochemical plant interruptions related to ~~lower~~hurricanes ~~sales~~in ~~volume~~the ~~and~~Gulf ~~management~~of ~~cost~~Mexico. The ~~reduction~~price ~~initiatives,~~volatility was particularly evident ~~partially~~with ~~offset~~respect byto ~~increased~~polyethylene, ~~charges~~a ~~related~~primary tomaterial ~~plant~~used ~~relocations~~in the Irrigation Components segment. As a result, ~~and~~the ~~increased~~Company ~~costs~~was ~~related~~not able to ~~compliance~~pass ~~with~~through ~~Sarbanes-Oxley~~all ~~rules~~ cost increases incurred and price ~~regulations~~increases passed through typically had little or no mark-up. As These afactors ~~percent~~had the effect of ~~sales~~reducing gross margins. In the Irrigation Components segment, some customers placed speculative purchase orders against ~~operating~~the ~~expenses~~risk ~~were~~of ~~unchanged~~further atprice 16increases or material unavailability.9% The Company did not experience any supply interruptions and prices have moderated somewhat since the end of the first quarter.

~~Operating~~As ~~income~~previously ~~for~~announced, during the ~~third~~ quarter ~~was $1~~,~~245,000, which was~~ ~~$1,210,000, or 49%, lower than in~~ the ~~comparable~~Company ~~prior~~ceased ~~year~~operations ~~period. By segment, operating income decreased $1,574,000~~ in the ~~Optical~~Electrical Components segment, ~~due~~when ~~primarily to lower sales~~it ~~volume,~~sold ~~difficulty~~its ~~and~~bobbin ~~delays~~manufacturing ~~in fully passing through resin price increases~~business. ~~and~~Prior ~~unfavorable product mix; increased $578,000 in the Material Handling Components segment, due~~ to the ~~benefits~~cessation of ~~previous plant consolidations; increased $185~~operations,~~000~~ in the ~~Irrigation~~Company ~~Components~~experienced ~~segment,~~excessive costs ~~primarily~~related ~~due~~ to ~~the effects~~closing ofinventory ~~higher~~activity, reduced sales ~~volume~~ and ~~the benefits of previous plant~~employee ~~consolidations;~~separation ~~and~~expenses. As ~~the~~a ~~operating~~result, a loss of ~~increased~~ $~~468~~387,000, inor ~~the~~$.10 ~~Electrical Components~~per ~~segment~~share, ~~primarily~~was ~~due~~incurred tofor ~~costs and inefficiencies of~~ the ~~business relocation~~first ~~which~~quarter ~~is underway~~ and ~~the effects of reduced sales volume. Operating~~reported ~~margin~~as ~~for~~a ~~the~~loss ~~quarter decreased~~ from ~~7.4%~~discontinued ~~in the third quarter of fiscal 2004 to 3~~operations.~~9% in the third quarter of fiscal 2005, due to the factors discussed above.~~

~~Net~~Results ~~interest expense for the quarter ended May 31, 2005 increased $155,000 from the prior year second quarter, due to the effects~~ of ~~higher average debt levels and higher average interest rates in the most recent period.~~Operations

The ~~provision~~following table ~~for~~sets ~~income~~forth ~~taxes~~certain ininformation, ~~the~~derived ~~third~~from ~~quarter~~Summa’s ~~was~~unaudited ~~$278,000,~~condensed ~~$466~~consolidated statements of income,~~000~~ ~~lower~~as ~~than~~a inpercent of sales for the ~~prior~~three ~~year~~month periods ~~third~~ended ~~quarter~~November 30, ~~due~~2004 toand ~~lower~~November 30, ~~income~~2005, ~~before~~and the ~~taxes.~~Company’s effective income tax rate during those periods:

Nine months ended May 31, 2005 compared to the nine months ended May 31, 2004

	Three months ended November 30
	2004		2005
Net sales	100.0	%	100.0	%
Cost of sales	74.7	%	75.5	%
Gross profit	25.3	%	24.5	%
S,G & A and other expenses	18.8	%	17.9	%
(Gain) on sale of real estate	(0.2	)%	(0.7	)%
Operating income	6.7	%	7.3	%
Interest expense, net	1.2	%	1.6	%
Income before tax and minority interest	5.5	%	5.7	%

Effective tax rate	35.4	%	35.8	%

~~Sales~~Quarter ~~for the nine months~~ ended ~~May~~November 3130, 2005 ~~increased~~compared ~~$3,345,000, or 4%, primarily due~~ to the ~~effects~~ ofquarter ~~price~~ended ~~increases (approximately $3~~November 30,~~700,000) and the contribution of~~ sales from recently acquired operations in the Irrigation Components segment (approximately $1,900,000), partially offset by the transfer of business to China (approximately $1,300,000). Sales were unchanged in the Optical Components segment, as price increases were offset by lower volume; increased 2% in the Material Handling Components segment, primarily due to price increases, partially offset by inefficiencies associated with a plant relocation; increased $4,043,000, or 25%, in the Irrigation Components segment, primarily due to the inclusion of sales from recently acquired operations (approximately $1,900,000), the effects of price increases (approximately $1,500,000), recaptured market share from certain major customers and improved market conditions; and decreased 12% in the Electrical Components segment, primarily due to the transfer of business to China and disruptions related to a plant relocation, partially offset by the effects of price increases.2004

~~Gross~~Sales ~~profit~~ for the first ~~nine~~quarter ~~months~~ ended ~~May~~November 3130, 2005 ~~decreased~~ increased $12,~~931~~252,000, or 9%, primarily ~~from~~due to the ~~comparable~~effects ~~prior~~of ~~year~~price ~~period~~increases (approximately $1,200,000) ~~primarily~~and some ~~due~~speculative buying by Irrigation Components segment customers to hedge ~~business~~against ~~relocation~~anticipated ~~expenses~~future ofhigher prices for resin. Sales increased $1373,~~393,~~000, ~~versus~~or ~~$316~~3%,~~000~~ in the Optical ~~same~~Components ~~prior year~~segment, ~~period~~primarily ~~and~~due ~~increased~~to ~~material~~price ~~costs~~increases (approximately $700,000) ~~partially~~and opportunistic non-recurring business (approximately $600,000), substantially offset by ~~the~~business ~~effects~~lost ~~of higher~~due ~~sales~~to ~~and~~competitive ~~higher~~pricing; ~~prices. Gross~~increased ~~margin~~$116,000, ~~decreased~~or ~~from 24.~~2%, in the Material Handling Components segment, primarily due to strength ~~21.~~in export sales; and increased $1,763,000, or 36%, in the Irrigation Components segment, primarily due to ~~increased~~speculative ~~relocation~~buying and price increases ~~expenses~~(approximately $470,000).

~~Operating~~Gross ~~expenses~~profit for the ~~nine~~first ~~months~~quarter ~~ended~~increased ~~May 31, 2005 decreased~~ $~~104~~340,000, or 15%, from the comparable prior year period, primarily due to the benefit of $186,000 from partial collection of a note receivable and a gain on the sale of excess real estate, partially offset by the inclusion of operating expenses of newly acquired operations and increased costs related to compliance with Sarbanes-Oxley rules and regulations. As a percent of sales, operating expenses decreased from 18.1% to 17.2%.

Operating income for the nine months ended May 31, 2005 was $3,430,000, which was $1,827,000, or 35%, lower than in the comparable prior year period. By segment, operating income decreased $2,334,000 in the Optical Components segment, due primarily to difficulty and delays in fully passing through resin price increases and unfavorable product mix; increased $1sales,~~147,000 in the Material Handling~~ ~~Components segment, primarily due to inefficiencies related to a plant consolidation in the prior year period,~~ partially offset by ~~expenses related to a plant relocation in the period ended May 31, 2005;~~ increased ~~$823,000~~material incosts. ~~the~~Gross ~~Irrigation~~margin ~~Components~~decreased ~~segment,~~from ~~primarily~~25.3% ~~due~~ to ~~the effects of higher sales volume and efficiencies gained from facility consolidation; and decreased $1~~24.5%,~~479,000~~ ~~in the Electrical Components segment,~~ primarily due to ~~costs of a~~increases ~~business relocation incurred~~ in ~~the~~plastic ~~nine~~resin ~~months~~costs ~~ended~~passed ~~May 31,~~through ~~2005. Operating~~to ~~margin~~customers ~~decreased~~without ~~from~~mark-up ~~6.1% in the~~and ~~first~~unfavorable ~~nine~~mix ~~months~~ of ~~fiscal 2004 to 3~~business.~~9% in the first nine months of fiscal 2005, due to the factors discussed above.~~

~~Net~~Operating ~~interest expense~~ expenses for the ~~nine~~first ~~months~~quarter, ~~ended~~excluding ~~May 31~~a $205,000 ~~2005~~gain ~~was~~from the sale of excess real estate, versus a $~~104~~43,000 ~~higher~~gain ~~than~~from a real estate sale in the ~~comparable~~ prior year ~~period~~first quarter, ~~due~~increased to$192,000, or 4%, from the ~~effects~~comparable ~~of higher~~prior ~~average~~year ~~debt~~period, primarily ~~levels~~due ~~and~~to ~~higher~~increased ~~average~~variable ~~interest~~sales ~~rates~~expenses inrelated ~~the~~to ~~most~~higher ~~recent~~sales and ~~period~~exchange rate costs, partially offset by ~~term~~management ~~loan~~cost ~~break-up~~reduction ~~fees~~initiatives. As ~~and~~a ~~the~~percent ~~write-off~~ of sales, operating expenses, ~~unamortized~~excluding ~~bank~~the ~~fees~~gain offrom ~~$266~~real estate sales,~~000~~ indecreased ~~the~~from ~~prior~~18.8% ~~year~~to ~~period~~17.9%.

~~The~~Operating ~~provision~~ income for the first quarter was $2,016,000, which was $310,000, or 18%, higher than in the comparable prior year period. By segment, operating income ~~taxes~~increased $522,000 in the ~~nine~~Optical ~~months~~Components ~~ended~~segment, primarily ~~May 31~~due to the gain of $205,000 on the sale of an excess building, the ~~2005~~benefit ~~was~~of non-recurring opportunistic business, management cost reduction initiatives and favorable product mix; increased $~~602~~13,000 ~~lower~~in ~~than~~the Material Handling Components segment; and was unchanged in the ~~comparable~~Irrigation ~~prior~~Components segment, ~~year~~despite ~~period~~substantially higher sales volume, primarily due to unfavorable ~~lower~~product mix and higher resin costs passed on with little or no ~~income~~mark-up. ~~before~~Operating ~~taxes~~margin for the quarter increased from 6.7% in the first quarter of fiscal 2005 to 7.3% in the first quarter of fiscal 2006, due to the factors discussed above.

~~The~~Net ~~Company’s~~interest expense ~~backlog~~for ofthe ~~unfilled~~quarter ~~orders~~ended November 30, ~~believed~~2005 toincreased ~~be firm, was~~ $8139,~~039,~~000 atfrom the ~~May 31,~~prior ~~2004,~~year $7first quarter,~~696,000~~ atdue ~~August 31,~~to ~~2004~~the ~~and $8,041,000~~effects atof ~~May 31,~~higher ~~2005. Because~~average interest rates in the ~~time~~most ~~between~~recent ~~entering~~period, andespite ~~order~~lower ~~and~~average ~~shipping~~debt ~~the~~levels. ~~product~~The weighted ~~and~~average ~~recording~~interest ~~a sale~~rate iswas ~~typically~~5.8% ~~shorter~~on ~~than~~$29.6 ~~one~~million ~~month~~in debt at November 30, 2005, ~~backlog~~versus ~~levels~~4.4% ~~are~~on ~~not~~$34.3 amillion ~~reliable indicator~~in ofdebt ~~future~~a ~~sales~~year ~~volume~~earlier.

The provision for income taxes in the first quarter of fiscal 2006 was $561,000, $66,000 higher than in the prior year first quarter, due to higher income before taxes. The effective income tax rate was slightly higher at 35.8% in the most recent quarter versus 35.4% a year earlier.

The Company’s backlog of unfilled orders, believed to be firm, was $6,707,000 at November 30, 2004, $5,592,000 at August 31, 2005 and $5,866,000 at November 30, 2005. Because the time between entering an order and shipping the product and recording a sale is typically shorter than one month, backlog levels are not a reliable indicator of future sales volume.

Liquidity and Capital Resources

Working Capital. The Company’s working capital was $2120,~~888~~844,000 at ~~May~~November 3130, 2004; $19,~~294~~075,000 at August 31, 2005 ~~2004~~ and $19,~~805~~923,000 at ~~May~~November 3130, 2005.

Summary of the Company’s debt at ~~May~~November 3130, 2005:

			Weighted
			Average				Fiscal Year Due
			Interest		Additional										2010 and
Description of Debt	Balance		Rate		Availability		~~Fiscal Year Due~~2006		2007		2008		2009		thereafter
															2009 and
Revolving line of credit	$	11,137,000	5.7	%	$	7,964,000	$	—	$	11,137,000	$	—	$	—	$	—
							2005		2006		2007		2008		thereafter
Bank term loan	3,308,000		4.7	%	—		736,000		1,022,000		1,071,000		479,000		—
Revolving line of credit	$	12,824,000	4.7	%	$	7,399,000	$	—	$	—	$	12,824,000	$	—	$	—
Real estate and other loans	15,147,000		6.1	%	—		1,145,000		4,430,000		1,412,000		1,058,000		7,102,000
Bank term loan	3,782,000		4.7	%	—		235,000		971,000		1,019,000		1,068,000		489,000
Total debt	$	29,592,000	5.8	%	$	7,964,000	$	1,881,000	$	16,589,000	$	2,483,000	$	1,537,000	$	7,102,000
Real estate and other loans	16,043,000		5.4	%	—		427,000		4,501,000		4,313,000		1,277,000		5,525,000
Subordinated debt	686,000		6.5	%	—		—		500,000		186,000		—		—
Total debt	$	33,335,000	5.1	%	$	7,399,000	$	662,000	$	5,972,000	$	18,342,000	$	2,345,000	$	6,014,000

The interest rate on the bank term loan is fixed for five years. Interest rates on the bank line of credit are subject to market fluctuation and are subject to reduction as the Company achieves certain financial milestones. Interest rates on most of the real estate and other loans are subject to market fluctuation.

Sources and Uses of Funds. Net cash provided by operating activities for the first ~~nine~~three months of fiscal ~~2005~~2006 was $2884,~~848,~~000 compared to $4584,~~152,~~000 ~~provided~~used byin operating activities for the first ~~nine~~quarter ~~months~~ of fiscal ~~2004.~~ 2005. The increase ~~decrease~~ was primarily due to ~~lower~~increases ~~net income. Net cash used~~ in ~~investing~~accounts ~~activities~~payable ~~was~~and accrued ~~$5,028,000~~liabilities in the ~~first~~most ~~nine~~recent ~~months~~quarter ofversus ~~fiscal~~decreases ~~2005, $1,368,000 less than~~ in the ~~first~~ ~~nine months of fiscal 2004, primarily due to an acquisition made in the~~ prior year ~~period~~first quarter, partially offset by ~~the~~a ~~investment~~larger increase in ainventory ~~new~~than ~~facility~~ in the prior ~~Material~~year ~~Handling~~comparable ~~Components~~period ~~segment~~ and ~~investments~~an increase in ~~equipment~~accounts ~~for~~receivable ~~a new manufacturing plant and process~~ in ~~Pharr,~~the ~~Texas~~most recent ~~for~~quarter ~~the~~versus ~~Electrical~~a ~~Components segment~~decrease in the ~~current~~prior year comparable period. ~~Net~~The ~~cash~~increase ~~of $1,959,000~~in ~~was~~inventory ~~provided~~in ~~by financing activities for~~ the ~~first~~most ~~nine months of~~recent ~~fiscal~~period ~~2005,~~was primarily bydue ~~debt~~to ~~related~~a tolevel ~~the~~loaded ~~new~~manufacturing ~~facility~~initiative ~~and~~in ~~equipment~~the ~~financing,~~seasonal ~~compared~~irrigation ~~to $2~~business,~~544,000~~ inhigher ~~net~~than ~~cash~~normal ~~provided~~raw inmaterial ~~the~~purchases ~~prior year first~~to ~~nine~~avoid ~~months~~announced ~~from~~price aincreases ~~new~~and ~~bank~~selected ~~relationship.~~increases to

Inimprove customer ~~October 2004,~~service ~~the~~levels. Increases in ~~Company~~accounts ~~announced~~payable awere ~~plan~~primarily related to ~~repurchase~~inventory upincreases. Net tocash used in investing activities was $214,000 in the first quarter, $3,253,000 less than in the first quarter of fiscal ~~its~~2005, ~~Common~~primarily ~~Stock~~due to an unusually large investment in a new facility ~~with~~in nothe ~~time~~Material ~~limit~~Handling (Components segment and investments in equipment in the first “quarter of fiscal 2005 ~~Buy~~and ~~Back”)~~proceeds from the sale of assets in the first quarter of fiscal 2006. Net cash of As$1,391,000 was used in financing activities for the first three months of fiscal ~~May 31~~2006, ~~2005~~compared to $3,435,000 in net cash provided in the ~~status~~prior year first three months. The change primarily represents retirement of debt in the ~~2005~~most ~~Buy~~recent ~~Back~~period, ~~was~~versus asincrease ~~follows:~~in debt in the prior year, associated with the new facility investment. Additionally, the Company used $409,000 for the repurchase of stock in the open market and payment of dividends in the first quarter of fiscal 2006 versus no such transactions in the first quarter of fiscal 2005.

	Shares repurchased	Average cost per share		Repurchase cost
Prior to March 2005	500	$	9.76	$	5,000
March 2005	600	$	8.81	$	5,000
April 2005	21,937	$	9.07	$	199,000
May 2005	8,728	$	7.87	$	69,000
Total	31,765	$	8.75	$	278,000

In October 2004, the Company announced a plan to repurchase up to $2,000,000 of its Common Stock with no time limit (the “2005 Buy Back”). As of November 30, 2005, the status of the 2005 Buy Back was as follows:

	Shares repurchased	Average cost per share		Repurchase cost

Prior to September 2005	62,481	$	8.32	$	520,000

September 2005	5,900	$	7.57	$	45,000
October 2005	7,157	$	7.91	$	56,000
November 2005	9,258	$	7.77	$	72,000
Total for the quarter	22,315	$	7.76	$	173,000

Total for the plan	84,796	$	8.17	$	693,000

The cost per share includes commissions where applicable.

Summa believes that cash flows from operations and existing credit facilities will be sufficient to fund working capital requirements, planned investments and debt service for the next twelve months. In addition, funds may be generated from a limited number of sales of certain non-core assets of the Company. The Company has a strategy of which includes growth by acquisition. In the event an acquisition plan is adopted which requires funds exceeding the availability described above, an alternate source of funds to accomplish the acquisition would have to be developed. The Company has 10,000,000 shares of common stock authorized, of which 3,~~970~~920,~~757~~226 shares were outstanding at ~~May~~November 3130, 2005 and 5,000,000 shares of “«blank check” » preferred stock authorized, of which none was outstanding at ~~May~~November 3130, 2005. The Company could issue additional shares of common or preferred stock or enter into new or revised borrowing arrangements to raise funds.

Off-Balance Sheet Arrangements

The Company’s material off-balance sheet arrangements are as follows:

Future Lease Payments. The Company leases offices and manufacturing facilities and certain equipment under non-cancelable operating leases. Future payments under these leases at ~~May~~November 3130, 2005 are approximately as follows:

Fiscal Year	Amount
2005	$	307,000
2006	$	848,000
2006	$	1,135,000
2007	$	871,000
2007	$	827,000
2008	$	749,000
2008	$	713,000
2009	$	526,000
2009	$	514,000
2010	$	18,000
2010 and thereafter	$	10,000
2011 and thereafter	$	1,000

In recent years the Company has consolidated and/or abandoned several facilities in an effort to improve efficiencies and operating results, and plans further consolidations. In the event the Company was to abandon a facility prior to its being leased to a new tenant, the Company could become obligated for accelerated lease payments or other expenses.

~~Critical Accounting Policies and Estimates~~14

~~The~~Critical ~~foregoing~~Accounting ~~discussion~~Policies and ~~analysis~~ of the Company’s financial condition and results of operations are based upon the consolidated financial statements of the Company, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of such financial statements requires management to make estimates and assumptions in applying certain critical accounting policies. Certain accounting estimates are particularly sensitive because of their significance to the Company’s consolidated financial statements and because of the possibility that future events affecting the estimates could differ markedly from current expectations. The Company believes that the following are some of the more critical judgment areas in the application of its accounting policies that affect the Company’s financial statements:Estimates

~~Impairment~~The offoregoing ~~Long-Lived~~discussion ~~Assets~~ and ~~Long-Lived~~analysis ~~Assets to be Disposed~~ of. ~~The~~the Company’s ~~reviews~~financial condition ~~its long-lived assets~~ and ~~certain~~results ~~identifiable~~of ~~intangibles~~operations ~~for~~are ~~impairment~~based ~~whenever~~upon ~~events or changes in circumstances indicate that~~ the ~~carrying~~consolidated ~~amount~~financial statements of anthe ~~asset~~Company, ~~may~~which ~~not~~have bebeen ~~recoverable.~~prepared ~~Recoverability~~in ofaccordance ~~assets~~with accounting toprinciples begenerally ~~held~~accepted ~~and~~in ~~used~~the isUnited ~~measured~~States byof aAmerica. ~~comparison~~The preparation of ~~the~~such ~~carrying~~financial ~~amount~~statements ofrequires anmanagement ~~asset~~ to ~~the~~make ~~undiscounted~~estimates and ~~future~~assumptions ~~operating~~in ~~cash~~applying ~~flows~~certain ~~expected~~critical toaccounting bepolicies. ~~generated~~Certain accounting byestimates ~~the~~are ~~asset.~~particularly Ifsensitive ~~such~~because ~~assets~~of ~~are~~their ~~considered~~ significance to ~~be impaired,~~ the ~~impairment~~Company’s toconsolidated befinancial ~~recognized~~statements isand ~~measured~~because byof the possibility ~~amount~~that byfuture ~~which~~events affecting the ~~carrying~~estimates ~~amount~~could ofdiffer ~~the~~markedly from ~~assets~~current ~~exceeds~~expectations. ~~the~~The ~~fair~~Company ~~value~~believes ofthat the ~~assets.~~following ~~Assets~~are tosome ~~be disposed~~ of the bymore ~~sale~~critical ~~are~~judgment ~~reported~~areas atin the ~~lower~~application of ~~the~~its ~~carrying~~accounting ~~amount~~policies that oraffect ~~fair~~the ~~value~~Company’s ~~less~~financial ~~costs to sell.~~statements:

14Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed of. The Company reviews its long-lived assets and certain identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the undiscounted future operating cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of by sale are reported at the lower of the carrying amount or fair value less costs to sell.

The Company has a significant amount of property and equipment and intangible assets. The determination as to whether events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable involves management’s judgment. In addition, should the Company conclude that recoverability of an asset is in question, the estimate of undiscounted future operating cash flows to determine whether an asset is recoverable and, if not, the final determination of the fair value of the asset, ~~are~~is also based on the judgment of management. These judgments can be impacted by a variety of underlying assumptions, such as the general business climate, effectiveness of competition and supply and cost of resources. Accordingly, actual results can differ significantly from the assumptions made by management in making its estimates. Future changes in management’s estimates could result in indicators of impairment and future impairment charges.

Valuation of Inventory. The Company values its inventories at the lower of cost or market using the first-in, first-out (FIFO) method. The Company records adjustments to the value of inventory based upon obsolescence and changes in market value as permanent changes in the carrying amount of such inventory until its ultimate sale or other disposition. The Company has evaluated the current level of inventories considering historical sales and other factors and, based on this evaluation, has recorded adjustments to cost of goods sold to adjust inventory to net realizable value. These adjustments are estimates, which could vary significantly, either favorably or unfavorably, from actual requirements if future economic conditions, customer demand or competition differ from expectations.

Accounts Receivable. The Company ~~performs~~ performs ongoing evaluations of customers and adjusts credit limits based upon ~~each~~ each customer’s payment history and credit worthiness, as determined by credit information available at that time. The Company monitors collections and payments from customers and maintains allowances for doubtful accounts for the inability of customers to make ~~required~~ required payments. If the financial condition of customers were to deteriorate resulting in an impairment of their ability to make payments, additional allowances may be required.

Goodwill. Goodwill represents the excess of purchase price over fair value of net ~~assets~~ assets acquired. Goodwill is tested for impairment annually in the fourth quarter, after completion of an annual planning process, or earlier if events occur which require an impairment analysis to be performed. With respect to each reporting unit which has any goodwill, the fair value is determined using traditional valuation methodology, and compared with its carrying value. If the fair value exceeds the unit’s carrying value, goodwill of the reporting unit is considered not to be impaired. If the unit’s carrying value exceeds its fair value, assets of the unit are individually valued to determine the implied fair value of the reporting unit goodwill. Impairment loss is recognized to the extent that the carrying value of the goodwill exceeds its implied fair value. Significant management judgment is involved in determining the fair value of assets. Future changes in management’s estimates could result in additional impairment charges to goodwill.

Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases. Deferred tax assets are also recognized for tax credit carryforwards and then assessed (including the anticipation of future income) to determine the likelihood of realization. Deferred tax assets and liabilities are measured using the rates expected to apply to taxable income in the years in which the temporary differences are expected to reverse and the credits are ~~expected to be used. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.~~

Accounting for Stock Options. Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation (‘SFAS 123”), as amended by SFAS 148, allows entities to continue to apply the provisions of Accounting Principles Board (“APB”) Opinion No. 25, Accounting for Stock Issued to Employees, and provide pro forma income and pro forma earnings per share disclosures for stock-based awards as if the fair-value based method defined in SFAS 123 had been applied. In accordance with APB Opinion No. 25, and related interpretations, compensation expense would generally be recorded for fixed option grants only if, on the date of the grant, the current price of the underlying stock exceeded the exercise price. The Company has elected to continue to apply the provisions of APB Opinion No. 25 and provide the pro forma disclosure provisions of SFAS 123. Accordingly, no compensation expense has been recognized for the Company’s stock option plans and award of options to non-employee directors. 15

~~QUANTITATIVE~~expected ~~AND~~to ~~QUALITATIVE~~be used. The ~~DISCLOSURES~~effect ~~ABOUT~~of ~~MARKET~~a ~~RISK~~change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

~~Except~~Accounting for Stock Options. The Company accounts for stock-based compensation in accordance with SFAS No. 123(R), Share-Based Payment. Under the ~~outstanding~~fair value recognition provisions ~~debt~~of ~~and~~this ~~related~~statement, ~~variable~~share-based ~~interest~~compensation ~~rates~~cost ~~set~~is ~~forth~~measured inat ~~“Management’s~~the ~~Discussion~~grant date ~~and~~based ~~Analysis~~on the value of ~~Financial~~the ~~Condition~~award and ~~Results~~is ofrecognized ~~Operations~~as –expense ~~Liquidity~~over ~~and~~the vesting ~~Capital~~period. The ~~Resources”~~Company ~~above,~~uses ~~there~~the Black-Scholes ~~are~~model noto ~~material~~calculate ~~changes~~the fair value and is required to exercise judgment and make assumptions concerning the ~~disclosure~~expected ~~set~~term, the expected ~~forth~~volatility, inand ~~Item~~the 7Aexpected ofdividends. ~~the~~If ~~Company’s~~actual ~~Annual~~results ~~Report~~differ onsignificantly from ~~Form 10~~these estimates, stock-Kbased ~~for~~compensation ~~the fiscal~~expense ~~year~~and ~~ended~~results ~~August 31,~~of operations ~~2004~~could be impacted. The Company has noelected ~~market~~to ~~risk~~use ~~sensitive~~the ~~instruments~~modified prospective ~~entered~~method, ~~into~~under ~~for~~which previously reported financial results are not ~~trading~~restated ~~purposes~~to reflect the stock based compensation expense formerly recognized in pro forma footnote disclosures and could affect comparability of historical results to results reported subsequent to the adoption of SFAS No. 123R.

15QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

~~EFFECTIVENESS~~Except OFfor ~~DISCLOSURE~~the outstanding ~~CONTROLS~~debt ~~AND~~and ~~PROCEDURES~~related variable interest rates set forth in “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” above, there are no material changes to the disclosure set forth in Item 7A of the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2005. The Company has no market risk sensitive instruments entered into for trading purposes.

AsEFFECTIVENESS ofOF ~~the~~DISCLOSURE ~~end~~CONTROLS ofAND the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Exchange Act Rules 13a – 14 and 13a-15. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective. There were no significant changes in the Company’s internal controls that could significantly affect these controls subsequent to the date of their evaluation.PROCEDURES

~~PART II~~As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Exchange Act Rules 13a-14 ~~OTHER~~and ~~INFORMATION~~13a-15. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective. There were no significant changes in the Company’s internal controls that could significantly affect these controls subsequent to the date of their evaluation.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The Company encounters lawsuits from time to time in the ordinary course of business and, at ~~May~~November 3130, 2005, the Company and/or its affiliates were parties to several civil lawsuits. Summa does not expect that the resolution of these lawsuits will have a material adverse impact on future results of operations or financial position. Certain lawsuits filed against the Company from time to time contain claims not covered by insurance, or seek damages in excess of policy limits, and such claims could be filed in the future. The Company may file patent infringement and/or other types of lawsuits in the future which may result in materially increased costs and other adverse consequences. Any costs and/or losses that Summa may suffer from such lawsuits, and the effect such litigation may have upon the reputation and marketability of Summa’s products, could have a material adverse impact on the future results of operations, financial condition and/or prospects of the Company.

Item 1A. Risk Factors

As of the date of this filing, there has been no material change to the risk factors previously disclosed in the Company’s Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In October 2004, ~~the~~ the Company announced a plan to repurchase up to $2,000,000 of its Common Stock with no time limit (the “2005 Buy Back”). As of ~~May~~November 3130, 2005, the status of the 2005 Buy Back was as follows:

	Shares repurchased	Average cost per share		Repurchase cost
Prior to March 2005	500	$	9.76	$	5,000
Prior to September 2005	62,481	$	8.32	$	520,000
March 2005	600	$	8.81	$	5,000
September 2005	5,900	$	7.57	$	45,000
April 2005	21,937	$	9.07	$	199,000
October 2005	7,157	$	7.91	$	56,000
May 2005	8,728	$	7.87	$	69,000
November 2005	9,258	$	7.77	$	72,000
Total	31,765	$	8.75	$	278,000
Total for the quarter	22,315	$	7.76	$	173,000
Total for the plan	84,796	$	8.17	$	693,000

Item 3. Defaults upon Senior Securities

None.

Item 4. Submission of Matters to a Vote of Security Holders

None.

Item 5. Other Information

None.

Item 6. Exhibits

	31.1	Section 302 Certification
	32.1	Section 906 Certification

31.1 Section 302 Certification

32.1 Section 906 Certification

SIGNATURES

Pursuant to the requirements of the ~~Securities~~ Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on ~~July~~January 810, ~~2005~~2006.

Summa Industries /s/ James R. Swartwout /s/ Trygve M. Thoresen James R. Swartwout Trygve M. Thoresen President and Chief Financial Officer Vice President and Secretary

/s/ James R. Swartwout /s/ Trygve M. Thoresen James R. Swartwout Trygve M. Thoresen President and Chief Financial Officer Vice President and Secretary

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