Authentic Specialty Foods Reports Record Third Quarter Results.

GRAND PRAIRIE, Texas--(BUSINESS WIRE)--Oct. 27, 1997--Authentic Specialty Foods, Inc. (Nasdaq: ASFD) today reported record results for the third quarter and nine months ended September 30, 1997. All results are presented pro forma to reflect the combination of Calidad and La Victoria on September 2, 1997.

Revenue for the third quarter of 1997 increased to a record $15.7 million from $14.5 million in the year earlier period. Net income for the third quarter of fiscal 1997 was a record $630,000, or $0.08 per share, versus net income of $481,000, or $0.06 per share for the same period in 1996. Weighted average shares outstanding in the third quarter of 1997 were 7,309,000 versus 7,090,000 in the year ago period. The increase in weighted average shares was primarily due to the exercise of the underwriters option for 600,000 shares to cover over-allotments.

For the nine months ended September 30, 1997, revenues grew to $45.6 million from $44.2 million for the comparable period in fiscal 1996. Net income for the first nine months of fiscal 1997 was $1.2 million, or $0.16 per share, versus net income of $599,000, or $0.08 per share, for the same period in fiscal 1996. Weighted average shares outstanding for the first nine months of fiscal 1997 totaled 7,228,000 versus 7,089,000 in the year ago period.

"The third quarter was an extremely successful period for our company," commented Keith R. Lively, chairman and chief executive officer of Authentic Specialty Foods. "We are especially pleased with the successful completion and integration of the La Victoria acquisition. La Victoria expands our company's presence into key western U.S. markets, including California, and gives us excellent distribution and trade relationships that will benefit us in many ways. With Calidad in the Texas and southwestern markets and La Victoria in the western and California markets, Authentic Specialty Foods has two, well-known brand names in the Mexican food category.

"Our goal at Authentic Specialty Foods is to become the leading manufacturer and distributor of Mexican food products in the southwestern and western portions of the United States. With expectations for the domestic Hispanic population to grow at more than double the national average and given the popularity of Mexican food among the general population, we are targeting several acquisitions that we believe will accelerate our expansion into this attractive, yet highly fragmented market.

"In pursuit of this strategy, we announced on September 23rd the acquisition of Houston-based La Monita Food Products, a 37-year-old manufacturer of Mexican food products distributed primarily in the Houston area. La Monita, which has become a wholly-owned subsidiary of Authentic, offers an array of quality Mexican food products that enjoy strong brand loyalty among consumers and accounted for sales of $6 million last year," Lively concluded.

Headquartered in Grand Prairie, Texas, Authentic Specialty Foods, Inc., provides an extensive line of Mexican food products to Mexican-American consumers and is the largest publicly-owned company engaged solely in the manufacture and distribution of Mexican food products targeting primarily the Mexican-American consumer. -0-

                   Authentic Specialty Foods, Inc.
           Consolidated Condensed Statements of Operations

                            (Unaudited)
               (In Thousands Except Per Share Amounts)


                          (Pro-Forma) (1)         (Pro-Forma) (1)
                        Three Months Ended       Nine Months Ended
                             September 30,          September 30,
                           1997        1996        1997        1996

Net Sales                $15,652     $14,506     $45,591     $44,184
Cost of Sales              8,459       8,148      24,883      24,917

Gross Profit               7,193       6,358      20,708      19,267

Selling, General &
 Administrative            5,744       4,981      17,531      16,800
Amortization Of
 Intangibles                 143         172         430         514

Income from
 Operations                1,306       1,205       2,747       1,953

Interest, net                158         232         548         767

(Gain) Loss On
 Disposal Of
 Property And
 Equipment                     0          58         (1)          70

Income Before
 Income Taxes              1,148         915       2,200       1,116

Income Tax
 Expense                     518         434       1,013         517

Net Income                  $630        $481      $1,187        $599


Earnings Per Share        0.0862      0.0678      0.1642      0.0845

Weighted Average
 Number Of Common
 Shares Outstanding        7,309       7,090       7,228       7,089

(1) La Victoria Foods, Inc. was acquired upon consummation of the public offering on September 2, 1997. Accordingly, only one month of La Victoria's Operations are included in the Company's actual results for the three months and nine months ended September 30, 1997. All applicable months in 1996 and eight months of 1997 are therefore presented on a pro-forma basis to give effect to the La Victoria acquisition and other pro-forma adjustments referenced in the Company's offering prospectus.

CONTACT: Authentic Specialty Foods Inc.

Keith R. Lively, 415/544-9966

or

Morgen-Walke Associates, Inc.

Doug Sherk, Jim Byers, 415/296-7383

Vince Daniels, Josh Passman, 212/850-5600