International Home Foods Inc. Reports Strong Results For 1997 Fourth Quarter And Full Year.

PARSIPPANY, N.J.--(BUSINESS WIRE)--March 6, 1998--International Home Foods, Inc. (NYSE: IHF) today reported its financial results for the three and twelve months ended December 31, 1997. Excluding a non-cash stock option compensation charge of $1.6 million, income from operations for the fourth quarter ended December 31, 1997 was $57.4 million, up $24.0 million, or 72%, from $33.4 million in the comparable 1996 period. For the twelve months ended December 31, 1997, income from operations before the stock option compensation charge was $190.1 million, up 24% from the comparable 1996 period.

Net income for the fourth quarter ended December 31, 1997 (which reflects the stock compensation charge and an extraordinary loss on refinancing the Company's bank debt) was $6.8 million ($0.09 per diluted share) as compared to $8.8 million ($0.14 per diluted share) for the quarter ended December 31, 1996. Net income for the year ended December 31, 1997 was $12.9 million ($0.19 per diluted share) as compared to $83.0 million ($1.34 per diluted share) for the year ended December 31, 1996. Excluding the after-tax effect of the non-cash stock option compensation charge and the extraordinary item, after-tax income for the quarter ended December 31, 1997, was $19.1 million, or $0.25 per diluted share, up 79% from the comparable 1996 per share amount, and $52.1 million, or $0.79 per diluted share, for the 12 months ended December 31, 1997.

The $46.4 million stock option charge taken in the second half of 1997 relates primarily to indexed stock options granted to senior management and other employees having exercise prices below the estimated fair market value of the Company's common stock. The $11.3 million extraordinary item represents the non-cash charge related to the write-off of deferred financing costs resulting from the refinancing of the Company's bank debt subsequent to the Company's initial public offering that was completed in November 1997.

The Company reported net sales of $378.5 million for the 1997 fourth quarter, up 59% from the comparable 1996 period. Excluding acquisitions, the Company's fourth-quarter 1997 sales were $250.0 million, up 5% from the comparable 1996 period. This increase was primarily driven by sales of Chef Boyardee(R) products, which rose 3% from the 1996 fourth quarter, to $97.3 million, and sales of the Company's Southwestern cuisine group of products, which were up 19% from the 1996 fourth-quarter level, to $38.7 million.

As a result of the Company's 1997 acquisitions, which added operations having lower gross margins than the Company's existing businesses, IHF's consolidated gross profits as a percentage of net sales decreased to 48% in the 1997 fourth quarter from 53% in the comparable 1996 period. Excluding the gross profit margins of businesses acquired in 1997, the Company's gross profit margins improved to 55% from 53%. This improvement is attributable to a more favorable sales mix, pricing actions, and continued reductions in the Company's manufacturing costs.

C. Dean Metropoulos, International Home Foods, Inc. Chairman and Chief Executive Officer, said: "IHF had an exciting year as progress was made on several strategic fronts, which created attractive returns for our current shareholders, and positions the Company for superior returns in the future. These areas of progress include revitalizing many of our brands through product extensions, reformulations and a substantial increase in our advertising; creating a much leaner and entrepreneurial organizational structure; completing, integrating and synergizing four strategic acquisitions; and significantly upgrading our management information systems, which will allow us to better manage our existing business as well as future acquisitions. In addition to accomplishing all of the above, the Company also generated very attractive increases in all areas of financial performance."

International Home Foods, Inc. is a nationally prominent manufacturer, distributor and marketer of food products. Its significant established brands include Chef Boyardee(R) prepared foods, Bumble Bee(R) and Orleans(R) canned seafood, PAM(R) cooking spray, Polaner(R) fruit spreads and spices, Gulden's(R) mustard, Crunch `n Munch(R) glazed popcorn, Campfire(R) marshmallows and crisped rice bars, Ro*tel(R) tomatoes with green chilies, Dennison's(R) chili, Ranch Style(R) and Luck's(R) beans.

Information Concerning Forward-Looking Statements

This press release contains forward-looking statements as defined by the Private Securities Reform Act of 1995, which are inherently subject to various risks and uncertainties. These include, without limitation, the future results of the Company's continuing acquisition program, and the ability of the Company to realize benefits from continuing to consolidate certain general and administrative functions, to retain key management, to execute its focused business strategies, and to continue to identify and implement product enhancements and new product ideas. These risks and uncertainties are set forth in greater detail in the Company's Forms 10-Q and 10-K filed with the Securities and Exchange Commission.

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                          International Home Foods, Inc.
                (Dollars in millions except per share and share data)



                          Three Months Ended   Twelve Months Ended
                            December 31,          December 31,
                          1997       1996      1997        1996


Net sales               $378.5      $238.7   $1,222.4     $942.8
Cost of goods sold       198.1       111.0      611.1      444.9

Gross profit             180.4       127.7      611.3      497.9
Operating expenses       123.0        94.3      421.2      344.7

Income before stock
 compensation expense     57.4        33.4      190.1      153.2

Stock compensation
 expense                   1.6           -       46.4          -
                      ---------    ---------  ---------  ---------

Operating income          55.8        33.4      143.7      153.2

Interest expense          25.4        17.1      104.7       17.1

Other non-operating
 income/(expense)         (0.5)        0.2        1.2        0.2

Income before taxes       29.9        16.5       40.2      136.3
Provision for income
 taxes                    11.8         7.7       16.0       53.3

Income before
 extraordinary item       18.1         8.8       24.2       83.0

Extraordinary item
 (net of tax)             11.3           -       11.3          -

Net Income               $ 6.8       $ 8.8     $ 12.9     $ 83.0
                     ==========   =========  =========   =========

Basic earnings per
 share                  $ 0.10      $ 0.14     $ 0.20     $ 1.34
Weighted average
 shares outstanding 70,313,418  61,922,823 64,020,472 61,922,823

Diluted earnings per
 share                  $ 0.09      $ 0.14     $ 0.19     $ 1.34

Weighted average shares
 outstanding        74,926,952  61,922,990 66,242,672 61,922,990

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CONTACT: Lynne Misericordia, IHF Treasurer

[phone]

or

Roy Winnick or Mark Semer, Kekst and Company

[phone] or 4802