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SPARTA FOODS ANNOUNCES THIRD-QUARTER AND NINE-MONTH SALES AND EARNINGS

 ST. PAUL, Minn., July 30 /PRNewswire/ -- Sparta Foods, Inc. today announced sales and earnings for its third-quarter and nine-month period ending June 30, 1993.
 Sales for the three-month period ended June 30 were $2,287,443, as compared to $2,318,435, in the previous year. Net income for the quarter was $83,345, compared with $70,646 for the third quarter of 1992, an 18 percent increase. The increase in net income is primarily due to a decrease in cost of sales relating to manufacturing press tortilla products previously purchased from an outside manufacturer. Sales in the third quarter were affected by the bankruptcy of a customer which represented eight percent of the company's business in 1992. The company has substantially replaced those lost sales by redirecting its food service sales efforts.
 For the nine-month period, sales grew 13 percent to $6,158,931, versus $5,443,711, for the first nine months of the previous year. Net income was $19,109, compared with $92,714, in 1992. The increase in sales is primarily attributable to the acquisition of Cruz Mexican Foods, Inc. in January 1992 and the acquisition of the Chapala(TM) salsa product lines in November 1992. The lower net income is primarily attributable to the start-up and development costs associated with the new press tortilla and burrito production lines, launching of the company's Chapala sales efforts in Iowa and costs associated with the start-up of the new private label division. Manufacturing and warehouse space was expanded to accommodate future sales growth, increasing occupancy costs.
 Nicholas Grammas, president and CEO of Sparta Foods, said, "The past nine months have been a transition period for Sparta Foods. Because we have successfully completed these transitions, we have the ability to react quickly to the changes and growth in the Mexican food industry and markets. We rounded out the company's manufacturing capabilities with the new press tortilla and burrito product lines. Press tortillas are the bread of the future and the burrito production line has opened doors to the private label business that not only brings in burrito sales, but also additional sales in our other product lines."
 Grammas continued, "Our private label programs were refined with new products and production lines, enabling us to better service customers in the fast growing retail private label sector. We added new personnel in the organization that position us for the future, upgrading the Company's technical expertise in the engineering, food technology, statistical and quality control areas."
 Sparta Foods, Inc. manufactures tortillas, tortilla chips, burritos, Mexican-style salsas and other sauces for sale and distribution to retail food stores and food service establishments, through its wholly owned subsidiaries, La Canasta of Minnesota, Inc. and Cruz Mexican Foods, Inc. In addition, Sparta manufactures Mexican food products and other sauces under private label for others. Sparta Foods, Inc., is headquartered in St. Paul, Minn., and its common stock is traded over- the-counter in Minneapolis/St. Paul, Minn. with the symbol SPFO.
 SPARTA FOODS, INC.
 Consolidated Statement of Operations
 (unaudited)
 Three Months Ended Nine Months Ended
 June 30, June 30,
 1993 1992 1993 1992
 Sales $2,287,443 $2,318,435 $6,158,931 $5,443,711
 Cost of Sales 1,692,210 1,777,786 4,766,221 4,155,097
 Gross Profit 595,233 540,649 1,392,710 1,288,614
 Selling, General
 and Administrative
 Expenses 424,843 391,147 1,260,230 1,061,997
 Operating Income 170,390 149,502 132,480 226,617
 Other Income (Expense)
 Interest Income 1,145 3,423 6,746 13,065
 Interest Expense (41,490) (35,279) (108,017) (85,468)
 -- (40,345) (31,856) (101,271) (72,403)
 Income Before Income
 Taxes 130,045 117,646 31,209 154,214
 Provision For Income
 Taxes 46,700 47,000 12,100 61,500
 Net Income $83,345 $70,646 $19,109 $92,714
 Net Income per
 Common Share $0.01 $0.01 $0.00 $0.01
 Weighted Average
 Number of Common
 and Common Equivalent
 Shares Outstanding 8,717,366 8,357,076 8,606,745 8,122,967
 -0- 7/30/93
 /CONTACT: John Mackay of Padilla Speer Beardsley, 612-871-8877, for Sparta Foods; or Nicholas G. Grammas of Sparta Foods, 612-646-1888/
 (SPFO)


CO: Sparta Foods, Inc. ST: Minnesota IN: FOD SU: ERN

AL -- MN003 -- 7613 07/30/93 09:09 EDT
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Date:Jul 30, 1993
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