<PAGE>   1

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q


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

                For the quarterly period ended February 28, 1999

                                       OR

     [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________________ to _______________________

                           Commission File No. 0-11488

                               PENFORD CORPORATION

--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


               Washington                             91-1221360
        ------------------------                  ------------------
        (State of Incorporation)                   (I.R.S. Employer
                                                  Identification No.)

777-108th Avenue N.E., Suite 2390, Bellevue, WA               98004-5193
--------------------------------------------------------------------------------
(Address of principal executive offices)                      (Zip Code)


Registrant's telephone number, including area code: (425) 462-6000

Indicate by a check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                                            Yes [X]   No [ ]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of April 7, 1999.

                 Class                                Outstanding
      -----------------------------                   -----------
      Common stock, par value $1.00                    7,441,754

<PAGE>   2


                      PENFORD CORPORATION AND SUBSIDIARIES

                                      INDEX

<TABLE>
<CAPTION>
                                                                 Page No.
                                                                 --------
<S>                                                               <C>

PART I  -  FINANCIAL INFORMATION

Item 1 - Financial Statements

Condensed Consolidated Balance Sheets
         February 28, 1999 and August 31, 1998                        3

Condensed Consolidated Statements of Income
         Three and Six Months Ended February 28, 1999
         and February 28, 1998                                        4

Condensed Consolidated Statements of Cash Flow
         Six Months Ended February 28, 1999 and
         February 28, 1998                                            5

Notes to Condensed Consolidated Financial Statements                6-7


Item 2 - Management's Discussion and Analysis of
         Financial Condition and Results of Operations             8-11

Item 3 - Quantitative and Qualitative Disclosures
         About Market Risk                                           12

PART II - OTHER INFORMATION

Item 1 - Legal Proceedings                                           13

Item 2 - Changes in Securities                                       13

Item 3 - Defaults Upon Senior Securities                             13

Item 4 - Submission of Matters to a Vote of Security Holders         13

Item 5 - Other Information                                           13

Item 6 - Exhibits and Reports on Form 8-K                         14-16

SIGNATURES                                                           17
</TABLE>


                                       2
<PAGE>   3

                         PART I - FINANCIAL INFORMATION

Item 1  Financial Statements

                      PENFORD CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                             (Dollars in thousands)

                                   A S S E T S

<TABLE>
<CAPTION>
                                                     February 28, 1999     August 31, 1998
                                                     -----------------     ---------------
<S>                                                        <C>                <C>
Current assets:
        Cash and cash equivalents                            $1,172             $3,200
        Trade accounts receivable                            19,901             20,957
        Inventories:
           Raw materials and other                            5,236              7,161
           Work in progress                                     665                900
           Finished goods                                     7,766              8,091
                                                           --------           --------
                                                             13,667             16,152
        Prepaid expenses and other                            4,359              5,424
                                                           --------           --------
           Total current assets                              39,099             45,733

Net property, plant and equipment                           110,364            107,049
Deferred income taxes                                        13,814             13,781
Restricted cash value of life insurance                      11,392             11,371
Other assets                                                  5,367              5,274
                                                           --------           --------
           Total assets                                    $180,036           $183,208
                                                           ========           ========

                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
        Accounts payable                                     $9,481             $8,509
        Accrued liabilities                                   6,877              5,596
        Current portion of long-term debt                     3,697             13,697
        Accrued liabilities, discontinued operations             --              1,761
                                                           --------           --------
           Total current liabilities                         20,055             29,563

Long-term debt                                               62,571             60,199
Other postretirement benefits                                10,474             10,383
Deferred income taxes                                        21,698             21,882
Other liabilities                                             7,660              7,186

Shareholders' equity:
        Common stock                                          9,131              9,130
        Additional paid-in capital                           20,058             20,223
        Retained earnings                                    57,462             54,644
        Treasury stock                                      (28,860)           (29,647)
        Note receivable from Savings and
           Stock Ownership Plan                                (213)              (355)
                                                           --------           --------
        Total shareholders' equity                           57,578             53,995
                                                           --------           --------
        Total liabilities and shareholders' equity         $180,036           $183,208
                                                           ========           ========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       3
<PAGE>   4

                      PENFORD CORPORATION AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME

                 (In thousands except share and per share data)


<TABLE>
<CAPTION>
                                                Three Months                         Six Months
                                              Ended February 28                   Ended February 28
                                         ---------------------------         ---------------------------
                                           1999               1998              1999              1998
                                         ---------         ---------         ---------         ---------
<S>                                      <C>               <C>               <C>               <C>
Sales                                      $37,161           $40,723           $75,932           $82,541
Cost of sales                               28,273            29,326            56,411            59,733
                                         ---------         ---------         ---------         ---------
    Gross margin                             8,888            11,397            19,521            22,808
Operating expenses                           5,635             6,500            11,309            13,293
                                         ---------         ---------         ---------         ---------
    Income from operations                   3,253             4,897             8,212             9,515
Interest expense, net                       (1,316)           (1,470)           (2,744)           (2,879)
                                         ---------         ---------         ---------         ---------

    Income from continuing
    operations before income taxes           1,937             3,427             5,468             6,636
Income taxes                                   678             1,203             1,914             2,317
                                         ---------         ---------         ---------         ---------
Income from continuing operations            1,259             2,224             3,554             4,319
Loss from discontinued operations               --            (1,209)               --            (2,807)
                                         ---------         ---------         ---------         ---------
Net income                                  $1,259            $1,015            $3,554            $1,512
                                         =========         =========         =========         =========


Weighted average common shares and
    equivalents outstanding              7,851,974         7,519,637         7,800,582         7,525,064

Earnings per common share from
    continuing operations;
    Basic                                    $0.17             $0.30             $0.48             $0.59
                                         =========         =========         =========         =========
    Diluted                                  $0.16             $0.30             $0.46             $0.57
                                         =========         =========         =========         =========

Earnings per common share;
    Basic                                    $0.17             $0.14             $0.48             $0.21
                                         =========         =========         =========         =========
    Diluted                                  $0.16             $0.13             $0.46             $0.20
                                         =========         =========         =========         =========


Dividends declared per common share          $0.05             $0.05             $0.10             $0.10
                                         =========         =========         =========         =========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       4
<PAGE>   5

                      PENFORD CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
                             (Dollars in thousands)

<TABLE>
<CAPTION>
                                                                           Six Months
                                                                       Ended February 28
                                                                    -----------------------
                                                                      1999           1998
                                                                    --------       --------
<S>                                                                   <C>          <C>
Operating Activities:
        Income from continuing operations                             $3,554         $4,319
        Adjustments to reconcile net income from
          continuing operations to net cash from
          continuing operations:
             Depreciation                                              6,066          5,929
             Deferred income taxes                                      (217)           332
             Change in operating assets and liabilities
               of continuing operations:
                 Trade receivables                                     1,056            231
                 Inventories                                           2,485           (934)
                 Accounts payable, prepaids and other                  3,535         (1,222)
                                                                    --------       --------
        Net cash flow from continuing operations                      16,479          8,655
        Net cash used by discontinued operations                      (1,017)        (3,556)
                                                                    --------       --------
        Net cash from operating activities                            15,462          5,099

Investing Activities:
        Additions to property, plant and equipment, net               (9,346)        (5,766)
        Other                                                            416            756
                                                                    --------       --------
        Net cash used by investing activities                         (8,930)        (5,010)

Financing Activities:
        Proceeds from unsecured line of credit                        15,895         48,330
        Payments on unsecured line of credit                         (20,246)       (47,620)
        Proceeds of long-term debt                                    10,000          5,000
        Payments on long-term debt                                   (13,277)        (5,536)
        Exercise of stock options                                         --            154
        Purchase of treasury stock                                      (196)            --
        Purchase of life insurance for officers' benefit plans            --         (1,158)
        Payment of dividends                                            (736)          (729)
                                                                    --------       --------
        Net cash used by financing activities                         (8,560)        (1,559)
                                                                    --------       --------
        Net decrease in cash and equivalents                          (2,028)        (1,470)
        Cash and cash equivalents (bank overdrafts) at
          beginning of period                                          3,200         (1,019)
                                                                    --------       --------

        Cash and cash equivalents (bank overdrafts) at
          end of period                                               $1,172        ($2,489)
                                                                    ========       ========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       5
<PAGE>   6

                      PENFORD CORPORATION AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


1.      BASIS OF PRESENTATION

        The accompanying unaudited condensed consolidated financial statements
        have been prepared in accordance with generally accepted accounting
        principles for interim financial information and with the instructions
        to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not
        include all of the information and footnotes required by generally
        accepted accounting principles for complete financial statements. In the
        opinion of management, all adjustments (consisting of normal recurring
        accruals) considered necessary for a fair presentation for the interim
        periods presented have been included. The preparation of financial
        statements in conformity with generally accepted accounting principles
        requires management to make estimates and assumptions that affect the
        amounts reported in the financial statements and accompanying notes.
        Actual results could differ from those estimates. Operating results for
        the three and six month periods ended February 28, 1999 are not
        necessarily indicative of the results that may be expected for the year
        ending August 31, 1999. For further information, refer to the
        consolidated financial statements and footnotes thereto included in
        Penford Corporation's ("Penford" or the "Company") annual report on Form
        10-K for the fiscal year ended August 31, 1998.

        Certain prior year amounts have been reclassified to conform with
        current year presentation, including the reclassifications necessary to
        present Penwest Pharmaceuticals Co. ("PPCO") as a discontinued
        operation. These reclassifications had no effect on previously reported
        net income.

2.      DISCONTINUED OPERATIONS

        At the end of fiscal 1998, Penford completed a tax-free distribution to
        its shareholders of the Company's pharmaceuticals subsidiary, PPCO. On
        August 31, 1998, Penford shareholders of record on August 10, 1998
        received PPCO shares on a basis of three shares of PPCO for every two
        shares of the Company. Prior to the spin-off, PPCO entered into a $15
        million revolving credit facility which is guaranteed by Penford. As of
        February 28, 1999 there was $2.5 million owed by PPCO under the
        facility.

        The consolidated financial statements of the Company prior to fiscal
        1999 have been restated to reflect the spin-off of PPCO. Accordingly,
        PPCO's operating results and cash flows for the quarter ended February
        28, 1998 have been excluded from their respective captions in the
        accompanying financial statements. These items have been reported as
        Loss from Discontinued Operations and Net Cash Flows from Discontinued
        Operations.


                                       6
<PAGE>   7

3.      INCOME TAXES

        The effective tax rate for the quarter and for the six months ended
        February 28, 1999 was 35%, which is the same as in the corresponding
        periods of the prior year. The effective rate in each fiscal year is
        higher than the federal statutory rate of 34.0% due primarily to the
        effects of state income taxes.

4.      EARNINGS PER COMMON SHARE

        The following table presents the computation of basic and diluted
        earnings per share under SFAS No. 128 (In thousands, except share and
        per share data):

<TABLE>
<CAPTION>
                                               Three Months Ended               Six Months Ended
                                                   February 28                     February 28
                                             -----------------------         -----------------------
                                               1999          1998              1999          1998
                                             ---------     ---------         ---------     ---------
<S>                                          <C>           <C>               <C>           <C>      
Income from continuing operations            $   1,259     $   2,224         $   3,554     $   4,319
                                             =========     =========         =========     =========
Net income                                   $   1,259     $   1,015         $   3,554     $   1,512
                                             =========     =========         =========     =========
Weighted average common
  shares outstanding                         7,396,069     7,292,632         7,376,475     7,280,334
Net effect of dilutive
  stock options                                455,905       227,005           424,107       244,730
                                             ---------     ---------         ---------     ---------
Weighted average common shares
  outstanding assuming dilution              7,851,974     7,519,637         7,800,582     7,525,064
                                             =========     =========         =========     =========
Earnings (loss) per common share, basic
  Continuing operations                      $    0.17     $    0.30         $    0.48     $    0.59
  Discontinued operations                           --         (0.16)               --         (0.38)
                                             ---------     ---------         ---------     ---------
  Net income                                 $    0.17     $    0.14         $    0.48     $    0.21
                                             =========     =========         =========     =========
Earnings (loss) per common share, diluted
  Continuing operations                      $    0.16     $    0.30         $    0.46     $    0.57
  Discontinued operations                           --         (0.17)               --         (0.37)
                                             ---------     ---------         ---------     ---------
  Net income                                 $    0.16     $    0.13         $    0.46     $    0.20
                                             =========     =========         =========     =========
</TABLE>


        Basic earnings per share reflects only the weighted average common
        shares outstanding. Diluted earnings per share reflects weighted average
        common shares outstanding and the effect of any dilutive common stock
        equivalent shares.


                                       7
<PAGE>   8

Item 2                MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

SPIN-OFF OF PENWEST PHARMACEUTICALS CO.

At the end of fiscal 1998, Penford effected a tax-free distribution to its
shareholders of the Company's pharmaceuticals subsidiary, Penwest
Pharmaceuticals Co. ("PPCO"). The distribution was completed on August 31, 1998
representing the culmination of the plan to foster the growth potential of the
Company's specialty paper chemical and food ingredients businesses, and
separately, the pharmaceuticals business.

In fiscal 1998, the Company recorded certain restructuring costs consisting
primarily of estimated costs associated with implementing the spin-off,
severance costs and other facilities charges. The obligation related to the
spin-off as of August 31, 1998 of approximately $1.8 million has been
substantially paid as of February 28, 1999. Prior to the spin-off, PPCO entered
into a $15 million revolving credit facility, which is guaranteed by Penford. As
of February 28, 1999 there was $2.5 million owed by PPCO under the facility.

The financial results discussed below are comprised of the Company's operations
in the carbohydrate-based specialty paper chemical and food ingredients
businesses.

RESULTS OF OPERATIONS

Net income for the quarter ended February 28, 1999 was $1.3 million, or $0.16
per share assuming dilution, compared to net income of $1.0 million, or $0.13
per share assuming dilution, for the corresponding period a year ago. The prior
year's quarter included after-tax losses of $1.2 million, or $0.17 per share
assuming dilution, related to the operations of PPCO. Net income for the six
months ended February 28, 1999 was $3.6 million, or $0.46 per share assuming
dilution, compared to $1.5 million, or $0.20 per share in the corresponding
period in fiscal 1998. The prior year's six-month period included after-tax
losses of $2.8 million, or $0.37 per share assuming dilution, related to the
operations of PPCO.

Total Company sales decreased in the second quarter and first six months of 
fiscal 1999 to $37.2 million and $75.9 million, respectively, representing 
decreases of 8.7% and 8.0%, respectively, from the corresponding periods in the
prior year. The change in sales was primarily due to lower sales volumes at 
Penford Products Co., the Company's specialty paper chemicals business, which 
decreased approximately 4.4% and 5.2%, respectively, from the same prior year 
periods. The Company's second quarter continued to be negatively impacted by the
conditions of the North American paper industry. Increased imports of coated and
uncoated printing and writing papers primarily from Asia and South America 
resulted in lower production rates at the North American paper customers served
by Penford Products Co.

Partially offsetting the volume decline at Penford Products Co. was the
continued strong progress at Penford Food Ingredients Co. Sales volumes of
specialty potato-based food starches increased by 42.2% in the first half of
fiscal 1999 over the same period a year ago.


                                       8
<PAGE>   9

Increased sales volume of specialty starches for whole and processed meats and a
strong market for coating products are attributed to the volume growth.

Gross margin in the second quarter of fiscal 1999 declined to 23.9% from 28.0%
in the corresponding quarter a year earlier due to the decreased manufacturing
efficiency of specialty carbohydrate-based paper chemicals resulting from lower
production volumes. The decrease in gross margin percentage is also due to
increased margin pressures attributed to competitive pricing arising from the
adverse conditions in the North American paper industry. Increased sales and
production volumes of higher margin, specialty food-grade starches partially
offset the decrease in gross margin. Gross margin for the six months ended
February 28, 1999 decreased to 25.7% from 27.6% in the same period a year
earlier primarily as a result of the factors noted above.

Operating expenses for the second fiscal quarter declined by $865,000, or 13.3%,
compared to the prior year period. For the six months ended February 28, 1999,
operating expenses decreased $2.0 million, or 14.9%. The decrease in operating
expense is due to reductions in corporate office expenses and the company-wide
emphasis on cost containment.

On March 22, 1999, the Company announced a plan to reduce the administrative
workforce at Penford Products Co. by approximately 15% in an effort to align
operating costs with current market conditions. The workforce reduction will be
implemented through the combination of a voluntary retirement incentive program
and involuntary layoffs. The voluntary retirement incentive program is expected
to minimize the number of involuntary layoffs, and will be funded primarily
through the Company's defined benefit retirement plan. Although the number of
employees accepting early retirement will not be known until the end of the
third fiscal quarter, the reduction in workforce could result in a pre-tax
earnings charge as high as $2.1 million.

Net interest expense for the second quarter and first half of fiscal 1999 was
$1.3 million and $2.7 million, respectively, compared to $1.5 million and $2.9
million in the corresponding periods a year ago. The decreases reflect lower
outstanding debt balances.

The effective tax rate for the second quarter and first half of fiscal 1999 was
35%, compared to 35% in the corresponding periods a year ago. The effective tax
rate is higher than the federal statutory rate of 34% due to the impact of state
income taxes.

LIQUIDITY AND CAPITAL RESOURCES

At February 28, 1999, Penford had working capital of $19.0 million, an unsecured
credit agreement of $75.0 million under which there was $44.0 million
outstanding, and several uncommitted lines of credit aggregating $10.0 million
under which there was no amount outstanding. The Company used available cash and
operating cash flow primarily to pay down $7.6 million of debt and to finance
capital expenditures of $8.9 million during the first six months of fiscal 1999.

Cash flow from continuing operations for the six months ended February 28, 1999
was $16.5 million compared to $8.7 million in the corresponding period of the
prior year. The


                                       9
<PAGE>   10

increase in operating cash flow is due to decreases in inventory and
fluctuations in the other components of working capital.

The Company began paying a quarterly cash dividend of $0.05 per share in 1992
and has paid such dividends each quarter since.

In November of 1998, the Board of Directors authorized a stock repurchase
program for the purchase of up to 500,000 shares of the outstanding stock of the
company. The Company repurchased 14,500 shares of its common stock in the first
six months of fiscal 1999 for approximately $196,000.

Net additions to property, plant and equipment during the six months ended
February 28, 1999 were $9.3 million. Second quarter additions of $4.2 million
were primarily for various improvements to the Penford Products Co.
manufacturing facility in Cedar Rapids, Iowa and equipment additions at the
Penford Food Ingredients Co. facility in Plover, Wisconsin. Capital expenditures
for the Company's specialty paper chemicals and food ingredients businesses for
fiscal 1999 are expected to be approximately $12 to $14 million. See
"Forward-looking Statements."

YEAR 2000

The Company has undergone an assessment of its information systems for
compliance with the Year 2000 issue. The assessment and resulting remediation
efforts are addressing all facets of the Company including plant automation
software including embedded controllers and process control devices, materials
management, engineering, laboratory, business systems and general user software.
In connection with the Company's ongoing capital program, and as part of the
Year 2000 remediation, a series of technology related expenditures are planned,
many of which have been, or are currently being implemented. The Company
anticipates that internal Year 2000 compliance issues will be substantially
remediated in the first half of calendar 1999. See "Forward-looking Statements."

It is anticipated that total expenses for Year 2000 remediation efforts may
range from $500,000 to $700,000, approximately 75% of which had been expended as
of February 28, 1999. See "Forward-looking Statements."

The Company does not anticipate significant delays in finalizing internal Year
2000 remediation efforts. See "Forward-looking Statements." However, third
parties having a material relationship with the Company may be a potential risk
based on their Year 2000 preparedness, which is not within the Company's
control. The Company has identified and evaluated the Year 2000 preparedness of
critical customers, suppliers and service providers. Based on the results of the
review, no alternative courses of action to the initial remediation plan were
warranted.

Management of the Company believes it has an effective program in place to
resolve the Year 2000 issue in a timely manner. As noted above, the Company has
not yet fully completed all necessary phases of the Year 2000 program. The
failure to correct a material Year 2000 problem could result in an interruption
in, or a failure of certain normal business activities. Such failures could
adversely affect the Company's results of operations, liquidity


                                       10
<PAGE>   11

and financial condition. In addition, disruptions in the economy generally
resulting from Year 2000 issues could also materially adversely affect the
Company. Although there is uncertainty inherent in the Year 2000 problem,
resulting in part from the uncertainty of the full extent of the readiness of
critical third-parties, and the Company is unable to determine all of the
consequences of Year 2000 failures, the impact on the Company is not expected to
be material.

The Company has contingency plans for its critical applications. These
contingency plans involve, among other actions, manual workarounds, increasing
inventories, and adjusting staffing strategies.

FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements concerning the estimated capital
expenditures, estimated expenses related to year 2000 issues and year 2000
preparedness, the information in Item 3 of this report and the anticipated
results of the Company. Certain forward-looking statements are identified with a
cross-reference to this section. There are a variety of factors which could
cause actual events or results to differ materially from those projected in the
forward-looking statements, including without limitation, competition; the
possibility of interruption of business activities due to equipment problems,
accidents, strikes, weather or other factors; product development risk; changes
in corn and other raw material prices; changes in general economic conditions or
developments with respect to specific industries or customers affecting demand
for the Company's products; unanticipated costs, expenses or third party claims;
the risk that results may be effected by construction delays, cost overruns,
technical difficulties, nonperformance by contractors or changes in capital
improvement project requirements or specifications; the possibility of technical
difficulties or cost overruns in the Company's Year 2000 compliance program; or
other unforeseen developments in the industries in which the Company operates.
Accordingly, there can be no assurance that future activities or results will be
as anticipated.

Forward-looking statements are based on the estimates and opinions of management
on the date the statements are made. The Company assumes no obligation to update
any forward-looking statements if circumstances or management's estimates or
opinions should change.

Additional information which could affect the Company's financial results is
included in the Company's 1998 Annual Report to Shareholders and its Form 10-K
for the fiscal year ended August 31, 1998 on file with the Securities and
Exchange Commission.


                                       11
<PAGE>   12

Item 3             QUANTITATIVE AND QUALITATIVE DISCLOSURES
                                About Market Risk

MARKET RISK SENSITIVE INSTRUMENTS AND POSITIONS

The market risk associated with the Company's market risk sensitive instruments
is the potential loss from adverse changes in interest rates and commodities
prices.

The Company is unaware of any material changes to the market risk disclosures
referred to in the Company's Report on Form 10-K for the year ended August 31,
1998.


                                       12
<PAGE>   13

                           PART II - OTHER INFORMATION

<TABLE>
<S>        <C>
Item 1     Legal Proceedings
           The registrant is unaware of any material developments in the legal
           proceedings referred to in the Registrant's Report on Form 10-K for
           the year ended August 31, 1998.

Item 2     Changes in Securities
           Not applicable

Item 3     Defaults Upon Senior Securities
           Not applicable

Item 4     Submission of Matters to a Vote of Security Holders

    (a)    The annual meeting of shareholders of Penford Corporation was held on
           January 25, 1999.

    (b)    The following directors were elected to serve a term of three years:
           William G. Parzybok, Jr., William K. Street, and John C. Hunter III.
           Jeffrey T. Cook was elected to serve until the annual meeting of
           shareholders to be held in 2001. The board is comprised of those
           elected this year and the following directors completing their terms:
           Paul H. Hatfield, Sally G. Narodick, and N. Stewart Rogers.

    (c)    The following matters were voted upon at the meeting:
           1. For the election of directors:
</TABLE>
<TABLE>
<CAPTION>
                                                     % of                  % of
                                          For        Voted     Withheld    Voted
                                       ---------     ------    --------    -----
<S>                                    <C>           <C>        <C>        <C>
           Jeffrey T. Cook             6,210,710     99.84%     10,158     0.16%
           John C. Hunter III          6,212,133     99.86%      8,735     0.14%
           William G. Parzybok, Jr.    6,203,468     99.72%     17,400     0.28%
           William K. Street           6,208,967     99.81%     11,901     0.19%
</TABLE>
<TABLE>
<S>        <C>
           2. Ratification of selection of Ernst & Young LLP as independent
           auditors of the Company:
</TABLE>
<TABLE>
                                                                         
                              For           Against        Abstain      
                           ---------        -------        -------      
                           <S>               <C>             <C>          
                           6,208,023         7,297           5,548        
</TABLE>
<TABLE>
<S>        <C>
    (d)    Not applicable

Item 5     Other Information
           Not applicable
</TABLE>


                                       13
<PAGE>   14

Item 6     Exhibits and Reports on Form 8-K.

<TABLE>
<CAPTION>
    (a)    Exhibits:
         <S>       <C>
          (3.1)    Restated Articles of Incorporation of Registrant (filed as an
                   Exhibit to Registrant's Form 10-K for fiscal year ended
                   August 31, 1995)

          (3.2)    Articles of Amendment to Restated Articles of Incorporation
                   of Registrant (filed as an exhibit to Registrant's Form 10-K
                   for fiscal year ended August 31, 1997)

          (3.3)    Bylaws of Registrant as amended and restated as of October
                   20, 1997 (filed as an exhibit to Registrant's Form 10-K for
                   fiscal year ended August 31, 1997)

          (4.1)    Amended and Restated Rights Agreement dated as of April 30,
                   1997 (filed as an Exhibit to Registrant's Amendment to
                   Registration Statement on Form 8-A/A dated May 5, 1997)

         (10.1)    Senior Note Agreement among Penford Corporation as Borrower
                   and Mutual of Omaha and Affiliates as lenders, dated November
                   1, 1992 (filed as an Exhibit to Registrant's Form 10-Q for
                   the quarter ended February 28, 1993)

         (10.2)    Loan Agreement among Penford Corporation as Borrower and
                   Seattle-First National Bank as Lender, dated December 1, 1989
                   (Registrant agrees to furnish a copy of this instrument to
                   the Commission on request)

         (10.3)    Penford Corporation Supplemental Executive Retirement Plan,
                   dated March 19, 1990 (filed as an Exhibit to Registrant's
                   Form 10-K for the fiscal year ended August 31, 1991)

         (10.4)    Penford Corporation Supplemental Survivor Benefit Plan, dated
                   January 15, 1991 (filed as an Exhibit to Registrant's Form
                   10-K for the fiscal year ended August 31, 1991)

         (10.5)    Penford Corporation Deferred Compensation Plan, dated January
                   15, 1991 (filed as an Exhibit to Registrant's Form 10-K for
                   the fiscal year ended August 31, 1991)

         (10.6)    Change of Control Agreements between Penford Corporation and
                   Messrs. Cook, Widmaier, Talley, Horn, and Rydzewski (a
                   representative copy of these agreements is filed as an
                   exhibit to Registrant's Form 10-K for the fiscal year ended
                   August 31, 1995)

         (10.7)    Penford Corporation 1993 Non-Employee Director Restricted
                   Stock Plan (filed as an Exhibit to Registrant's Form 10-Q for
                   the quarter ended November 30, 1993)

         (10.8)    Note Agreement dated as of October 1, 1994 among Penford
                   Corporation, Principal Mutual Life Insurance Company and TMG
                   Life Insurance Company (filed as an Exhibit to Registrant's
                   Form 10-Q for the quarter ended February 28, 1995)

         (10.9)    Penford Corporation 1994 Stock Option Plan as amended and
                   restated as of January 21, 1997 (filed on Form S-8 dated
                   March 17, 1997)
</TABLE>


                                       14
<PAGE>   15

<TABLE>
         <S>       <C>
         (10.10)   Penford Corporation Stock Option Plan for Non-Employee
                   Directors (filed as an exhibit to the Registrant's Form 10-Q
                   for the quarter ended May 31, 1996)

         (10.11)   Separation Agreement dated as of July 31, 1998 between
                   Registrant and Penwest Pharmaceuticals Co. (filed as an
                   exhibit to Registrant's Form 8-K dated August 31, 1998)

         (10.12)   Services Agreement dated as of July 31, 1998 between
                   Registrant and Penwest Pharmaceuticals Co. (filed as an
                   exhibit to Registrant's Form 8-K dated August 31, 1998)

         (10.13)   Employee Benefits Agreement dated as of July 31, 1998 between
                   Registrant and Penwest Pharmaceuticals Co. (filed as an
                   exhibit to Registrant's Form 8-K dated August 31, 1998)

         (10.14)   Tax Allocation Agreement dated as of July 31, 1998 between
                   Registrant and Penwest Pharmaceuticals Co. (filed as an
                   exhibit to Registrant's Form 8-K dated August 31, 1998)

         (10.15)   Excipient Supply Agreement dated as of July 31, 1998 between
                   Registrant and Penwest Pharmaceuticals Co. (filed as an
                   exhibit to Registrant's Form 8-K dated August 31, 1998)

         (10.16)   Restatement and Exchange Agreement amending the Senior Note
                   Agreement among Penford Corporation as Borrower and Mutual of
                   Omaha and Affiliates as lenders, dated as of August 1, 1998
                   (filed as an exhibit to Registrant's Form 10-K for the fiscal
                   year ended August 31, 1998)

         (10.17)   Guaranty Agreement dated as of August 1, 1998 by Penford
                   Products Co., a wholly-owned subsidiary of Registrant, of the
                   Restatement and Exchange Agreement among Registrant and
                   Mutual of Omaha and Affiliates (filed as an exhibit to
                   Registrant's Form 10-K for the fiscal year ended August 31,
                   1998).

         (10.18)   Intercreditor Agreement dated as of August 1, 1998 among the
                   parties to the Credit Agreement dated July 2, 1998 and the
                   parties to the Senior Note Agreements dated as of August 1,
                   1998 (filed as an exhibit to Registrant's Form 10-K for the
                   fiscal year ended August 31, 1998).

         (10.19)   Restatement and Exchange Agreement amending the Note
                   Agreement among Penford Corporation as Borrower, and
                   Principal Mutual Life Insurance Company and TMG Life
                   Insurance Company as lenders, dated as of August 1, 1998
                   (filed as an exhibit to Registrant's Form 10-K for the fiscal
                   year ended August 31, 1998).

         (10.20)   Guaranty Agreement dated as of August 1, 1998 by Penford
                   Products Co., a wholly-owned subsidiary of Registrant, of the
                   Restatement and Exchange Agreement among Registrant,
                   Principal Mutual Life Insurance Company, and TMG Life
                   Insurance Company (filed as an exhibit to Registrant's Form
                   10-K for the fiscal year ended August 31, 1998)

         (10.21)   Credit Agreement dated as of July 2, 1998 among Penford
                   Corporation and Penford Products Co. as borrowers, and
                   certain commercial lending institutions as the lenders, and
                   The Bank of Nova Scotia, as agent for the lenders (filed as
                   an exhibit to Registrant's Form 10-K for the fiscal year
                   ended August 31, 1998)
</TABLE>


                                       15
<PAGE>   16

<TABLE>
         <S>       <C>
         (10.22)   Specific Guarantee made by Penford Corporation in favor of
                   The Bank of Nova Scotia (the "Bank") in respect to the
                   indebtedness and liability of Penwest Pharmaceuticals Co. to
                   the Bank under a letter loan agreement dated as of July 2,
                   1998 (filed as an exhibit to Registrant's Form 10-K for the
                   fiscal year ended August 31, 1998)

         (10.23)   Specific Guarantee made by Penford Products Co. in favor of
                   The Bank of Nova Scotia (the "Bank") in respect to the
                   indebtedness and liability of Penwest Pharmaceuticals Co. to
                   the Bank under a letter loan agreement dated as of July 2,
                   1998 (filed as an exhibit to Registrant's Form 10-K for the
                   fiscal year ended August 31, 1998)

         (10.24)   Revolving Term Credit Facility in Favor of Penwest
                   Pharmaceuticals Co. as borrowers and The Bank of Nova Scotia
                   as lender dated as of July 2, 1998 (filed as an exhibit to
                   Registrant's Form 10-K for the fiscal year ended August 31,
                   1998)

             27    Financial Data Schedule
</TABLE>

(b) There were no filings on Form 8-K in the quarter ended February 28, 1999.


                                       16
<PAGE>   17

                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.



                                                 Penford Corporation
                                                 -------------------
                                                    (Registrant)



February 12, 1999                           /s/  JEFFREY T. COOK
-----------------                           ------------------------------------
      Date                                  Jeffrey T. Cook
                                            President and
                                            Chief Executive Officer
                                            (Principal Executive Officer)



February 12, 1999                           /s/  KEITH T. FUJINAGA
-----------------                           ------------------------------------
      Date                                  Keith T. Fujinaga
                                            Corporate Controller
                                            (Chief Accounting Officer)

                                       17