Exhibit 13
                  MANAGEMENT'S DISCUSSION AND ANALYSIS



Results of Operations

Overview

Fiscal 1998 net earnings were $20 million, or $1.09 per basic share, 
compared with $2.8 million, or 15 cents per basic share, in fiscal 1997.  
Net earnings increased on substantially higher operating earnings in 
Multifoods Distribution Group and North America Foods, which offset a 
significant decline in Venezuela Foods operating results and a higher 
effective tax rate.  Net earnings were also affected by unusual items in 
both years.  Excluding unusual items, fiscal 1998 net earnings were 
$23.2 million, or $1.26 per basic share, compared with $17.6 million, or 
98 cents per basic share, in fiscal 1997.

Fiscal 1998 results included an unusual after-tax charge of $3.2 
million, or 17 cents per share, as a result of a determination that 
receivables from a major customer of the Company's former food exporting 
business may not be fully recoverable.  The Company exited its food 
exporting business in fiscal 1998.  Unusual items in fiscal 1997 
resulted in a $14.8 million after-tax charge, or 83 cents per share.  
Further discussion of unusual items follows in Segment Results and in 
Note 3 to the consolidated financial statements.

Net sales for fiscal 1998 increased 1% to $2.6 billion.

Segment Results

The Company operates in three business segments: Multifoods Distribution 
Group, North America Foods and Venezuela Foods.  In fiscal 1998, the 
Company changed the name of its Foodservice Distribution segment to 
Multifoods Distribution Group.  In addition, the Company is now 
reporting the results of its former food exporting business in Divested 
Businesses.  Food exporting results were previously included in 
Multifoods Distribution Group.  Previously reported segment financial 
information has been reclassified to conform with the fiscal 1998 
presentation.

A description of the business segments and summary of operating results 
are included in Note 17 to the consolidated financial statements.

Fiscal 1998 compared with Fiscal 1997

Multifoods Distribution Group:  Net sales increased 2% to $1.8 billion.  
An increase in vending distribution net sales from higher volumes in the 
independent and fund-raising customer segments was partially offset by 
lower sales in the foodservice distribution business (formerly referred 
to as limited-menu distribution).  Foodservice distribution net sales 
declined as a result of decisions to relinquish low-margin accounts.

Operating earnings before unusual items increased 384% to $23.7 million 
as a result of a substantial improvement in vending distribution.  
Vending distribution results improved on higher volumes, lower delivery 
and distribution costs, and a reduction in bad debt expense.  In 
addition, vending distribution earnings benefited from the purchase of 
coffee prior to world-market price increases.  Operating earnings also 
increased in foodservice distribution because of lower delivery and 
distribution costs.  Segment results also included a $2 million 
curtailment gain from the elimination of the subsidy for post-retirement 
health-care benefits for future retirees.  See Note 16 to the 
consolidated financial statements for additional information.

Fiscal 1997 unusual items included a $4 million charge for a 
restructuring plan and a $1.1 million charge to consolidate two 
foodservice distribution facilities.  The restructuring plan involved 
moving key customer support functions from a central location to each of 
the Company's vending distribution centers.  All significant actions 
related to the plan were completed in fiscal 1998.

In fiscal 1998, the Company announced that it would combine its vending 
and foodservice distribution businesses into a single distribution 
business to capitalize on growth and cost-saving opportunities.  As a 
result, the Company expects to incur unusual charges during fiscal 1999.  
Although the Company believes such charges will be material to its 
results of operations, it is presently unable to estimate the amount of 
the charges or the benefits from such actions as the details and 
timetable of the consolidation plan have yet to be completed.  The 
recognition of these charges will be dependent upon the timing of 
management's approval of the consolidation plan.

North America Foods:  Net sales declined 1% to $471.7 million due to 
lower prices of the Company's grain-based products that resulted from a 
reduction in commodity costs and from unfavorable currency translation 
because of a weakening Canadian dollar.  The decline was partially 
offset by higher volumes in Canadian commercial flour and U.S. bakery 
products.

Operating earnings before unusual items increased 47% to $30.6 million 
as a result of higher volumes and margins in Canadian commercial flour 
and U.S. bakery products.  The increase in margins was the result of a 
more favorable product and customer mix, lower manufacturing costs and 
lower ingredient costs.  Segment results also included a $0.6 million 
curtailment gain from the elimination of the subsidy for post-retirement 
health-care benefits for future retirees.  The increase in operating 
earnings was partially offset by an operating loss in the Company's 
Canadian frozen bakery business due to lower volumes and margins, and 
unfavorable currency translation.

In fiscal 1997, the Company recognized an unusual charge of $11.4 
million for asset impairment in its Canadian frozen bakery business.  
The impairment resulted from a significant decline in operating results 
during fiscal 1997, which occurred because of competitive pressures.  
The Company estimated the fair value of the assets in accordance with 
Statement of Financial Accounting Standards No. 121.  During the second 
quarter of fiscal 1998, the Company announced its decision to sell the 
business, which had net assets of approximately $15 million as of 
February 28, 1998.  If the Company is not successful in realizing its 
current estimate of fair value, it may be required to recognize an 
additional material charge to its results of operations.

Venezuela Foods:  Net sales increased 4% to $360.7 million, as prior 
year sales were adversely affected by a significant devaluation in the 
exchange rate while the Company operated under price controls.  The 
Venezuelan government eliminated price controls in April 1996.  The net 
sales increase was partially offset by a substantial decrease in 
consumer corn flour volumes.  The volume decline resulted from difficult 
economic conditions that caused a loss of consumer purchasing power and 
a shift in consumer buying patterns, including an overall decline in 
corn flour consumption.  Volumes were also affected by continued 
competitive pressures and the Company being awarded less than its 
anticipated share of corn flour for a Venezuelan government subsidy 
program.  The program is designed to make available to low-income 
consumers certain basic food products at below market prices and 
involves competitive bids by suppliers.  

The business segment recognized an operating loss of $0.2 million, 
compared with operating earnings of $18.6 million last year.  In 
addition to the lower corn flour volumes, the operating loss resulted 
from economic and competitive conditions that prevented the Company from 
raising prices sufficiently to cover higher raw material and operating 
costs.  Operating costs increased primarily because of local inflation, 
which was approximately 37% in fiscal 1998.

The Company expects that the difficult economic and competitive 
environment in Venezuela will continue to adversely affect the Company's 
Venezuela Foods operating results in fiscal 1999.  In order to improve 
Venezuela Foods' operating performance, the Company will be evaluating 
opportunities to reduce costs and focus on strategies that provide the 
highest possible returns to shareholders. As a result, future actions 
taken by the Company could result in material unusual charges to the 
Company's results of operations.

Divested Business:  The Company's Divested Business segment in fiscal 
1998 and 1997 represents the results of its former food exporting 
business.  This business was principally involved in the international 
trading of food products.  A significant portion of food exporting's 
sales was to a major customer that distributes food products in Russia.  
During fiscal 1998, the Company entered into an exit agreement to wind 
down its business with the major customer. In addition, the remainder of 
the food exporting business was sold.  The proceeds and earnings impact 
from the sale were immaterial.  The decline in fiscal 1998 net sales and 
operating earnings before unusual items is a result of the Company's 
decision to exit this business.

In fiscal 1998, the Company recognized an unusual pre-tax charge of $5 
million as a result of a determination that receivables from the major 
customer may not be fully recoverable.  The charge reduced the carrying 
value of the receivables to their estimated net realizable value.  Prior 
to the charge, the Company's financial position included a $10.7 million 
note receivable and accounts receivable of $4.6 million from the major 
customer.  In estimating net realizable value, considerable management 
judgment is necessary and, accordingly, future events may result in 
additional charges that could be material to the Company's results of 
operations.  See Note 12 to the consolidated financial statements for 
additional discussion.

In fiscal 1998, the Company was notified that approximately $6 million 
in Company-owned inventory was stolen from a ship in the port of St. 
Petersburg, Russia. The ship had been chartered by the major customer of 
the Company's former food exporting business. The Company believes, 
based on the facts known to date, that the loss is covered by insurance.  
If the loss from the theft of product is not covered by insurance, the 
Company would likely recognize a material charge to its results of 
operations. 

Corporate:  Fiscal 1997 corporate expenses included $2.2 million in 
costs associated with the resignation of the Company's former chief 
executive officer and $1.4 million principally for the cost of business 
assessment studies.

Fiscal 1997 compared with Fiscal 1996

Fiscal 1997 net earnings were $2.8 million, or 15 cents per basic share, 
compared with net earnings of $24.1 million, or $1.33 per basic share, 
in fiscal 1996.  The decline in net earnings was primarily the result of 
unusual charges and an operating loss in the Company's vending 
distribution business.  Excluding unusual items, fiscal 1997 net 
earnings were $17.6 million, or 98 cents per basic share, compared with 
$23.6 million, or $1.31 per basic share, in fiscal 1996.

Net sales for fiscal 1997 were up 3% to $2.6 billion.  All of the 
Company's business segments recorded sales increases.

Multifoods Distribution Group:  Net sales increased 2% to $1.7 billion, 
primarily because of higher volumes in the foodservice distribution 
business, which resulted from the addition of several new customer 
accounts in fiscal 1997.  The increase was partially offset by a sales 
decline in vending distribution, resulting from lower volumes.  The 
Company addressed the decline in sales volumes by restructuring certain 
customer support functions that resulted in a $4 million unusual charge, 
as described above.

Operating earnings before unusual charges declined 73% to $4.9 million 
as a result of the vending distribution operating loss.  The decline was 
partially offset by higher earnings in foodservice distribution as a 
result of lower operating costs and the higher volumes.  Fiscal 1996 
operating earnings included an unusual charge of $9.4 million, primarily 
from the write-down of vending distribution software.

North America Foods:  Net sales increased 4% to $476.7 million because 
of price increases resulting from higher worldwide wheat costs and 
volume growth in consumer products.  The increase was partially offset 
by lower volumes in U.S. bakery mix, which resulted from softness in a 
large customer's business, and lower volumes in Canadian frozen bakery 
products.

Operating earnings before unusual items were $20.8 million, unchanged 
from the prior year.  While higher consumer product volumes increased 
earnings, lower U.S. bakery mix and Canadian frozen bakery volumes 
adversely affected results.  In addition, fiscal 1996 earnings benefited 
from a 53-week reporting period.

Venezuela Foods:  Net sales increased 6% to $346.8 million on higher 
sales prices and increased consumer corn flour volumes.  The increase 
was partially offset by lower volumes in commercial wheat flour and 
animal feeds.  Sales volumes were affected by substantially higher local 
prices, which caused consumers to shift to lower-priced products, such 
as corn flour, and away from higher-priced products, such as meat and 
prepared foods products.  Sales in the prior year were adversely 
affected by a significant devaluation in the free-market exchange rate 
while the Company operated under government price controls.

Operating earnings declined 3% to $18.6 million as a result of 
significant prior year currency devaluation, which affected first 
quarter results, competitive pricing pressures following the April 1996 
implementation of economic reforms and a major increase in the cost of 
locally grown grain.  Prior year results were adversely affected by a 
significant devaluation in the free-market exchange rate and a $3.9 
million charge associated with the December 1995 change in the official 
exchange rate.  When the official exchange rate was changed, the Company 
had to settle certain U.S. dollar obligations at a substantially higher 
cost.

Corporate:  Fiscal 1996 corporate expenses included an unusual charge of 
$6.2 million for costs associated with reducing corporate administrative 
operations.

Divested Businesses:  Fiscal 1997 results represent the Company's former 
food exporting business, which the Company exited in fiscal 1998.  In 
addition to the food exporting business, fiscal 1996 Divested Businesses 
results included the surimi seafood business, which was sold in June 
1995.  Fiscal 1997 operating earnings before unusual items increased 15% 
to $7.7 million as a result of higher volumes to the major customer of 
the food exporting business.  The unusual gain of $9.9 million in fiscal 
1996 was from the sale of the surimi seafood business.

Non-Operating Expense and Income

In fiscal 1998, net interest expense declined to $12.4 million from 
$16.8 million last year.  The decline was primarily the result of $3.2 
million in interest income recognized on U.S. Federal income tax 
refunds, lower interest rates in Canada and lower debt levels.

In fiscal 1997, net interest expense declined to $16.8 million from 
$17.9 million as a result of lower interest rates in Canada and $1 
million in interest income recognized on U.S. Federal income tax 
refunds.

In fiscal 1996, other income (expense) included foreign exchange losses 
of $3.6 million on cash and cash equivalents in Venezuela.

Income Taxes

The effective tax rates on earnings before unusual items were 38% in 
fiscal 1998, 30% in fiscal 1997 and 29.4% in fiscal 1996.  The increase 
in fiscal 1998 was due to the substantial decline in Venezuela Foods 
operating results, which had a low effective tax rate in prior years.  
Including the effects of unusual items, the Company's overall tax rates 
were 38.2% in fiscal 1998, 44.6% in fiscal 1997 and 13.3% in fiscal 
1996. The high tax rate in fiscal 1997 was primarily caused by a low tax 
benefit associated with the Canadian frozen bakery business impairment 
charge.  The low tax rate in fiscal 1996 was the result of a $5 million 
benefit from a tax settlement.

Financial Condition 

Capital Resources and Liquidity
The Company's short-term financing is provided by borrowings against its 
U.S. and Canadian revolving credit agreements and uncommitted lines of 
credit.  Approximately $280 million in committed U.S. and Canadian 
revolving credit agreements and $140 million of uncommitted lines of 
credit in the United States are maintained to ensure availability of 
funds.  Additionally, the Company's Venezuelan subsidiary has 
uncommitted lines of credit totaling $148 million.  The Company has a 
medium-term note program under its shelf registration statement filed 
with the Securities and Exchange Commission that provides for the 
issuance of up to $150 million in medium-term notes in various amounts.  
As of February 28, 1998, $140 million was available under the medium-
term note program.  See Notes 8 and 9 to the consolidated financial 
statements for additional information on capital resources.

During fiscal 1998, the debt-to-total-capitalization ratio decreased 
from 51% to 38%.  The improvement was due primarily to an increase in 
cash provided by operations, including a significant reduction in 
working capital, and proceeds from the exercise of stock options.

The reduction in working capital was the result of lower accounts 
receivable and inventory balances along with an increase in accounts 
payable.  The reduction in accounts receivable and inventories was 
partially caused by the Company's decision to wind down its business 
with a major customer of the former food exporting business.  The 
Company also had substantial collections against a significant prior 
year-end accounts receivable balance with this customer.  In addition, 
working capital requirements were reduced in all businesses through 
improved management processes, including the Company's implementation of 
Economic Value Added principles. For example, a new grain procurement 
process in Venezuela was established that resulted in extended payment 
terms and, accordingly, increased the accounts payable balance 
outstanding at fiscal year-end.

Capital expenditures for fiscal 1998 were $26.1 million, compared with 
$27.5 million in fiscal 1997.  Approximately 25% of the fiscal 1998 
capital expenditures was attributable to projects designed to increase 
earnings through volume improvements, new business or cost savings.  The 
remaining capital expenditures were related to projects required to 
maintain existing facilities and equipment.

The Company believes that cash flows from operations together with 
available external financing will be sufficient to fund operations, 
dividend payments and capital expenditures anticipated for fiscal 1999.

Business and Credit Concentrations

The Company's Venezuelan operations are subject to risks inherent in 
operating under a different legal and political system along with a 
difficult economic environment.  Among these risks are inflation, 
currency volatility, possible limitations on foreign investment, 
exchangeability of currency, dividend repatriation and changes in 
existing tax laws.

The Company's present strategies for managing Venezuelan currency risk 
include product pricing strategies and active management of its net 
monetary exposure, principally through U.S. dollar versus bolivar 
denominated financing.  With respect to product pricing strategies, the 
Company is exposed to the risk of declines in gross profit margins if 
the bolivar were to decline in value versus the U.S. dollar.  With 
respect to the Company's Venezuela monetary position (which includes its 
bolivar denominated assets and liabilities, except for inventory and 
fixed assets), the Company is exposed to the risk of foreign exchange 
gains and losses if the bolivar were to change in value versus the U.S. 
dollar.  For example, if the bolivar were to decline in value and the 
Company were in a net monetary asset position (i.e., bolivar denominated 
assets exceed liabilities), there would be foreign exchange losses, the 
amount of which would depend upon the size of the net monetary asset 
position and the magnitude of the currency devaluation.  Conversely, if 
the Company were in a net monetary liability position (i.e., bolivar 
denominated liabilities exceed assets) and the bolivar declined in 
value, there would be foreign exchange gains.  As of February 28, 1998, 
the Company's Venezuelan operation was in a net monetary asset position 
of $7 million.

The Company has a carrying value of approximately $10.3 million ($15.3 
million net of a $5 million reserve) in notes and accounts receivable 
from the major customer of the Company's former food exporting business. 
In the event of economic or political instability in Russia or if the 
customer experienced difficulty in meeting its commitments, there could 
be a material adverse effect on the Company's results of operations.

Commodity Risk Management

The Company's Canadian operations minimize risks associated with wheat 
market price fluctuations by hedging its wheat and flour inventories, 
open wheat purchase contracts and open flour sales contracts with wheat 
futures contracts.  The Company also enters into futures contracts to 
reduce the risk of price increases on certain anticipated raw material 
purchases.  See Note 7 to the consolidated financial statements for 
further discussion.

Year 2000

The Company has completed a comprehensive inventory and review of its 
computer systems and identified the systems that could be affected by 
the "Year 2000" issue.  An implementation plan addressing these issues 
has been developed.  The Company believes that implementation of 
scheduled upgrades to packaged software systems in North America will 
resolve the remaining "Year 2000" issues.  The costs associated with 
implementing these upgrades, as well as ongoing testing of North 
American systems, are not expected to be material to the Company's 
results of operations.  North American systems are scheduled to be 
compliant by June 30, 1999.

In Venezuela, the Company is in the process of evaluating packaged 
software to replace existing business and financial systems that are not 
"Year 2000" compliant.  The capital cost for a new business system is 
estimated at $5.5 million. Alternatively, the Company may choose to 
modify some or all of its existing systems making them "Year 2000" 
compliant.  The cost of these modifications is estimated at up to $1 
million. The replacement or modification of existing systems is expected 
to be completed prior to the year 2000.  

The Company believes that with upgrades to existing packaged systems in 
North America and conversion to new replacement systems in Venezuela, 
the "Year 2000" issue will not pose significant operational problems.  
However, if such upgrades or conversions are not completed in a timely 
manner, or major suppliers or customers experience "Year 2000" issues in 
their respective systems, the "Year 2000" issue may have a material 
adverse effect on the operations of the Company.

Cautionary Statement Relevant to Forward-Looking Information

This document contains certain statements that are forward-looking as 
defined in the Private Securities Litigation Reform Act of 1995.  These 
forward-looking statements are based on current expectations or beliefs, 
including, but not limited to, statements concerning the Company's 
operations and financial performance and condition.  The Company 
cautions that these statements by their nature involve risks and 
uncertainties, and actual results may differ materially depending on a 
variety of important factors, including, among others, the impact of 
competitive products and pricing; market conditions and weather patterns 
that may affect the costs of grain and other raw materials; changes in 
laws and regulation; the inability of the Company to obtain its 
estimated fair value of its Canadian frozen bakery business, which is 
being held for sale; the inability of the Company to either resolve the 
Company's "Year 2000" issues or to accurately estimate the cost 
associated with "Year 2000" compliance; economic and political 
conditions in Venezuela, including inflation, currency volatility, 
possible limitations on foreign investment, exchangeability of currency, 
dividend repatriation and changes in existing tax laws; economic or 
political instability in Russia, including the possibility of tariff law 
changes or other marketplace changes and restrictions; the inability of 
the major customer of the Company's former food exporting business to 
meet remaining commitments; the inability of the Company to collect 
insurance proceeds related to the theft of inventory from the port of 
St. Petersburg, Russia; fluctuations in foreign exchange rates; other 
risks commonly encountered in international trade; and other factors as 
may be discussed in the Company's reports filed with the Securities and 
Exchange Commission.  

Independent Auditors' Report

The Board of Directors and Shareholders of
International Multifoods Corporation:

We have audited the accompanying consolidated balance sheets of 
International Multifoods Corporation and subsidiaries as of February 28, 
1998 and 1997, and the related consolidated statements of earnings and 
cash flows for each of the years in the three-year period ended February 
28, 1998.  These consolidated financial statements are the 
responsibility of the Company's management.  Our responsibility is to 
express an opinion on these consolidated financial statements based on 
our audits.

    We conducted our audits in accordance with generally accepted 
auditing standards.  Those standards require that we plan and perform 
the audit to obtain reasonable assurance about whether the financial 
statements are free of material misstatement.  An audit includes 
examining, on a test basis, evidence supporting the amounts and 
disclosures in the financial statements.  An audit also includes 
assessing the accounting principles used and significant estimates made 
by management, as well as evaluating the overall financial statement 
presentation.  We believe that our audits provide a reasonable basis for 
our opinion.

    In our opinion, the consolidated financial statements referred to 
above present fairly, in all material respects, the financial position 
of International Multifoods Corporation and subsidiaries as of February 
28, 1998 and 1997, and the results of their operations and their cash 
flows for each of the years in the three-year period ended February 28, 
1998, in conformity with generally accepted accounting principles.


KPMG Peat Marwick LLP
Minneapolis, Minnesota
March 30, 1998



Management's Responsibility for Financial Statements

The consolidated financial statements have been prepared by management 
in conformity with generally accepted accounting principles and include, 
where required, amounts based on management's best estimates and 
judgments.  Management continues to be responsible for the integrity and 
objectivity of data in these consolidated financial statements, which it 
seeks to assure through an extensive system of internal controls.  Such 
controls are designed to provide reasonable, but not absolute, assurance 
that assets are safeguarded from unauthorized use or disposition and 
that financial records are sufficiently reliable to permit the 
preparation of consolidated financial statements.  It is recognized that 
estimates and judgments are required to assess and balance the relative 
cost and expected benefits of any system of internal controls.  

    The system of internal accounting controls is designed to provide 
reasonable assurance that the books and records reflect the Company's 
transactions and that its established policies and procedures are 
carefully followed.  The system includes written policies and 
procedures, a financial reporting system, an internal audit department 
and careful selection and training of qualified personnel.


Gary E. Costley                    William L. Trubeck
Chairman, President                Senior Vice President, Finance, and 
Chief Executive Officer            and Chief Financial Officer;
                                   President, Latin America Operations



            INTERNATIONAL MULTIFOODS CORPORATION and SUBSIDIARIES
                      Consolidated Statements of Earnings



Fiscal year ended the last day of February
(in thousands, except per share data)  1998          1997          1996
------------------------------------------------------------------------

Net sales                        $2,611,792    $2,595,873    $2,523,197
Cost of materials and production (2,237,586)   (2,215,366)   (2,135,707)
Delivery and distribution          (163,915)     (167,788)     (162,870)
------------------------------------------------------------------------
Gross profit                        210,291       212,719       224,620
Selling, general and
  administrative                   (160,481)     (170,508)     (168,825)
Unusual items                        (5,000)      (20,107)       (5,700)
------------------------------------------------------------------------
Operating earnings                   44,810        22,104        50,095
Interest, net                       (12,377)      (16,758)      (17,908)
Other income (expense), net             (38)         (330)       (4,433)
------------------------------------------------------------------------
Earnings before income taxes         32,395         5,016        27,754
Income taxes                        (12,371)       (2,236)       (3,679)
------------------------------------------------------------------------
Net earnings                     $   20,024    $    2,780    $   24,075
========================================================================

Earnings per share of common stock:
  Basic                          $     1.09    $      .15    $     1.33
  Diluted                              1.08           .15          1.32
-----------------------------------------------------------------------

Average shares of common stock outstanding:
  Basic                             18,385        17,982        17,965
  Diluted                           18,619        17,987        18,014
----------------------------------------------------------------------


See accompanying notes to consolidated financial statements.




              INTERNATIONAL MULTIFOODS CORPORATION and SUBSIDIARIES
                          Consolidated Balance Sheets


February 28, 1998 and 1997
(in thousands)                                         1998        1997
------------------------------------------------------------------------
Assets
Current assets:
  Cash and cash equivalents                        $ 10,363    $  8,753
  Trade accounts receivable, net of allowance       144,201     207,459
  Inventories                                       265,989     283,948
  Deferred income taxes                               7,080       9,418
  Other current assets                               56,771      53,678
-----------------------------------------------------------------------
    Total current assets                            484,404     563,256
-----------------------------------------------------------------------
Property, plant and equipment, net                  220,567     225,357
Goodwill, net                                        84,911      87,641
Other assets                                         37,504      39,034
-----------------------------------------------------------------------
Total assets                                       $827,386    $915,288
=======================================================================
Liabilities and Shareholders' Equity
Current liabilities:
  Notes payable                                    $  1,025    $ 88,201
  Current portion of long-term debt                  25,042       6,790
  Accounts payable                                  217,500     206,966
  Other current liabilities                          68,856      70,037
-----------------------------------------------------------------------
    Total current liabilities                       312,423     371,994
-----------------------------------------------------------------------
Long-term debt                                      162,857     202,328
Deferred income taxes                                13,810      17,419
Employee benefits and other liabilities              28,943      33,969
-----------------------------------------------------------------------
    Total liabilities                               518,033     625,710
-----------------------------------------------------------------------
Shareholders' equity:
  Preferred capital stock                                 -           -
  Common stock, authorized 50,000 shares;
    issued 21,844 shares                              2,184       2,184
  Capital in excess of par value                     91,340      88,124
  Retained earnings                                 398,754     393,335
  Equity adjustment from foreign                            
    currency translation                           (110,812)   (108,000)
  Equity adjustment from minimum 
    pension liability                                (3,499)     (2,309)
  Treasury stock, 3,106 and 3,835 shares, at cost   (67,480)    (83,262)
  Unearned compensation                              (1,134)       (494)
------------------------------------------------------------------------
    Total shareholders' equity                      309,353     289,578
------------------------------------------------------------------------
Commitments and contingencies
------------------------------------------------------------------------
Total liabilities and shareholders' equity         $827,386    $915,288
========================================================================

See accompanying notes to consolidated financial statements.


<TABLE>
<CAPTION>
                INTERNATIONAL MULTIFOODS CORPORATION and SUBSIDIARIES
                     Consolidated Statements of Cash Flows

Fiscal year ended the last day of February
(in thousands)                                    1998         1997         1996
--------------------------------------------------------------------------------
<S>                                           <C>          <C>          <C>
Cash flows from operations:
  Net earnings                                $ 20,024     $  2,780     $ 24,075
  Adjustments to reconcile net earnings
    to cash provided by (used for) operations:
      Depreciation and amortization             30,670       30,748       29,772
      Provision for unusual charges              5,000       20,107       15,493
      Gain on major business disposition             -            -       (9,900)
      Deferred income tax expense                2,486        3,252        4,544
      Provision for losses on (recoveries of)
        receivables                               (228)       2,862        5,783
      Change in noncurrent notes receivable    (10,298)        (328)         485
      Changes in working capital, net of 
        business acquisitions 
        and disposition*                        85,877      (71,196)     (43,456)
      Other, net                                (3,334)        (672)      (1,215)
---------------------------------------------------------------------------------
          Cash provided by
            (used for) operations              130,197      (12,447)      25,581
---------------------------------------------------------------------------------
Cash flows from investing activities:
  Acquisitions of businesses,
    net of cash acquired                             -            -      (29,904)
  Capital expenditures                         (26,125)     (27,507)     (31,181)
  Proceeds from business disposition                 -            -       48,009
  Proceeds from other property disposals         2,562          623        1,707
  Other, net                                       (14)           -            -
--------------------------------------------------------------------------------
          Cash used for 
            investing activities               (23,577)     (26,884)     (11,369)
--------------------------------------------------------------------------------
Cash flows from financing activities: 
  Net increase (decrease) in notes payable     (86,521)      60,119      (12,203)
  Additions to long-term debt                    9,278       20,000       85,945
  Reductions in long-term debt                 (28,251)     (25,390)     (65,165)
  Dividends paid                               (14,665)     (14,477)     (14,471)
  Proceeds from issuance of common stock        16,108          546        1,470
  Purchase of treasury stock                      (799)         (82)      (2,877)
  Redemption of preferred stock                      -            -       (3,732)
  Other, net                                       (16)        (230)        (712)
---------------------------------------------------------------------------------
          Cash provided by (used for)
            financing activities              (104,866)      40,486      (11,745)
---------------------------------------------------------------------------------
Effect of exchange rate changes
  on cash and cash equivalents                    (144)          90       (5,751)
---------------------------------------------------------------------------------
Net increase (decrease) in cash
  and cash equivalents                           1,610        1,245       (3,284)
Cash and cash equivalents at beginning of year   8,753        7,508       10,792
---------------------------------------------------------------------------------
Cash and cash equivalents at end of year      $ 10,363     $  8,753     $  7,508
=================================================================================
*Cash flows from changes in working capital,
   net of business acquisitions and disposition:
     Accounts receivable                      $ 60,774     $(45,043)    $(45,993)
     Inventories                                16,065      (53,086)      19,172
     Other current assets                       (4,019)      (9,671)      (4,759)
     Accounts payable                           13,184       36,688       16,871
     Other current liabilities                    (127)         (84)     (28,747)
----------------------------------------------------------------------------------
       Net change                             $ 85,877     $(71,196)    $(43,456)
==================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.

Notes to Consolidated Financial Statements

Note 1: Summary of Significant Accounting Policies

Basis of statement presentation  

The accompanying consolidated financial statements include the accounts 
of International Multifoods Corporation and all of its subsidiaries.  
Intercompany accounts and transactions have been eliminated in 
consolidation.  Certain amounts in the prior year financial statements 
have been reclassified to conform to the current year presentation.

Net sales  

The Company reports the gross margin earned from commodity sales of its 
former food exporting business as net sales.  If gross commodity sales 
had been reported, net sales and cost of sales would have increased by 
$60.5 million in fiscal 1998, $278.2 million in fiscal 1997 and $227.2 
million in fiscal 1996.

Cost of sales

To more closely match costs with related revenues, the Company 
classifies the inflation element inherent in interest rates on 
Venezuelan local currency borrowings and the foreign exchange gains and 
losses, which occur on certain Venezuelan borrowings, as components of 
cost of sales.  Accordingly, cost of sales was increased by $0.9 million 
in fiscal 1998 and $2.6 million in fiscal 1997, and was reduced by $7.8 
million in fiscal 1996.

Foreign currency translation and transactions  

The functional currency of the Company's Canadian operations is the 
Canadian dollar.  Assets and liabilities are translated at current 
exchange rates, and results of operations are translated using the 
weighted average exchange rate in effect during the fiscal year.  The 
gains or losses resulting from translation are included as a separate 
component of shareholders' equity.

The functional currency of the Company's Venezuelan operations is the 
U.S. dollar.  Nonmonetary assets and liabilities, principally inventory 
and fixed assets, are translated at historical exchange rates, while 
monetary assets and liabilities are translated at current exchange 
rates.  Results of operations are translated using the weighted average 
exchange rate in effect during the fiscal year, except that cost of 
sales and depreciation are translated at historical rates.  The gains or 
losses resulting from translation are included in the determination of 
net earnings. 

The Company recognized in its results of operations net foreign exchange 
gains of $0.1 million in fiscal 1998, $0.4 million in fiscal 1997 and 
$2.4 million in fiscal 1996.

Stock-based compensation  

The Company applies Accounting Principles Board Opinion No. 25, 
"Accounting for Stock Issued to Employees" (APB 25), and related 
interpretations in accounting for its stock-based compensation.  Under 
APB 25, compensation expense is recorded for stock options if the market 
price of the underlying stock exceeds the exercise price on the date of 
grant.  The Financial Accounting Standards Board issued Statement No. 
123, "Accounting for Stock-Based Compensation" (SFAS 123), which the 
Company adopted in fiscal 1997.  SFAS 123 gives the Company the option 
either to continue the Company's current method of accounting for stock-
based compensation or to adopt the fair value method of accounting.  The 
Company elected to continue accounting for stock-based compensation 
using APB 25 and to provide pro forma disclosure as if the fair value 
method had been applied.  See Note 14.

Income taxes  

Income taxes are accounted for under the asset and liability method.  
Deferred tax assets and liabilities are recognized for the expected 
future tax consequences of temporary differences between the financial 
statement carrying amount and the tax basis of assets and liabilities.  


Earnings per share  

The Company adopted Statement of Financial Accounting Standards No. 128, 
"Earnings Per Share" (SFAS 128), in the fourth quarter of fiscal 1998.  
SFAS 128 establishes standards for computing and presenting earnings per 
share and requires restatement of previously reported earnings per share 
amounts.  For the Company, basic earnings per share under SFAS 128 are 
equivalent to earnings per share previously reported.  

Basic earnings per share are computed by dividing net earnings by the 
weighted average shares outstanding during the reporting period.  
Diluted earnings per share are computed similar to basic earnings per 
share except that the weighted average shares outstanding are increased 
to include additional shares from the assumed exercise of stock options.  
The number of additional shares is calculated by assuming that 
outstanding stock options were exercised and the proceeds from such 
exercises were used to acquire shares of common stock at the average 
market price during the reporting period.

Cash and cash equivalents  

Included in cash and cash equivalents are cash on hand, time deposits 
and highly liquid short-term investments purchased with original 
maturities of three months or less ("cash equivalents").

Inventories  

Inventories, excluding grain in Canada, are valued principally at the 
lower of cost (first-in, first-out) or market (replacement or net 
realizable value).

In Canada, inventories of grain are valued on the basis of replacement 
market prices prevailing at fiscal year-end.  The Company generally 
minimizes risks associated with market price fluctuations by hedging 
those inventories with futures contracts.  Therefore, included in 
inventories is the amount of gain or loss on open grain contracts, 
including futures contracts, which generally has the effect of adjusting 
those inventories to cost.

The Company also enters into futures contracts to reduce the risk of 
price increases with respect to certain anticipated raw material 
purchases.  The futures contracts are accounted for as hedges, with 
gains and losses deferred in inventory and subsequently included in cost 
of sales as the inventory is sold.  

Property, plant and equipment  

Property, plant and equipment is stated at cost, and depreciation is 
computed using the straight-line method for determining financial 
statement income. When permitted, accelerated depreciation methods are 
used to calculate depreciation for income tax purposes.

Goodwill and other intangibles  

Goodwill represents the excess of cost of businesses acquired over the 
fair market value of net tangible and identifiable intangible assets.  
Such excess costs are being amortized on a straight-line basis over 
various periods not exceeding 40 years.  Identifiable intangible assets 
represent costs allocated to noncompete agreements, trade names and 
other specifically identifiable assets arising from business 
acquisitions.  These assets are amortized on a straight-line basis over 
their estimated useful lives.  Accumulated amortization of goodwill and 
other intangibles at February 28, 1998 and 1997, was $25.9 million and 
$22.2 million, respectively.

The Company assesses the recoverability of goodwill and other long-lived 
assets whenever events or changes in circumstances indicate that 
expected future undiscounted cash flows may not be sufficient to support 
the carrying amount of an asset.  The Company deems an asset to be 
impaired if a forecast of undiscounted future operating cash flows is 
less than its carrying amount.  If an asset is determined to be 
impaired, the loss is measured as the amount by which the carrying value 
of the asset exceeds its fair value.  An estimate of fair value is based 
on the best information available, including values for similar assets 
or the results of valuation techniques such as discounting estimated 
future cash flows.  The Company generally measures fair value by 
discounting estimated future cash flows.

Use of estimates  

The preparation of financial statements in conformity with generally 
accepted accounting principles requires management to make estimates and 
assumptions that affect the reported amounts of assets and liabilities 
and disclosure of contingent assets and liabilities at the date of the 
financial statements and the reported amount of revenues and expenses 
during the reporting period.  Actual results could differ from these 
estimates.

New accounting pronouncements  

In June 1997, the Financial Accounting Standards Board (FASB) issued 
Statement of Financial Accounting Standards No. 130, "Reporting 
Comprehensive Income" (SFAS 130), which establishes standards for 
reporting comprehensive income and its components in the financial 
statements.  Comprehensive income is defined as the change in the equity 
of a business from all nonowner transactions and events.  The Company is 
required to adopt SFAS 130 in the first quarter of fiscal 1999.  The 
Company does not expect the adoption of SFAS 130 to have a material 
effect on the consolidated financial statements.

In June 1997, the FASB also issued Statement of Financial Accounting 
Standards No. 131, "Disclosures about Segments of an Enterprise and 
Related Information" (SFAS 131), which establishes standards for 
disclosure of operating segments, products and services, geographic 
areas and major customers.  The Company is required to adopt SFAS 131 
beginning with its annual report for the fiscal year ending February 28, 
1999.  The Company does not expect the adoption of SFAS 131 to have a 
material effect on its current definition of operating segments or the 
consolidated financial statements.

Note 2:  Interest, Net

Interest, net consisted of the following:

(in thousands)                            1998     1997     1996
-----------------------------------------------------------------
Interest expense                       $17,651  $18,658  $19,613
Capitalized interest                        (8)    (109)    (128)
Non-operating interest income           (5,266)  (1,791)  (1,577)
-----------------------------------------------------------------
  Interest, net                        $12,377  $16,758  $17,908
=================================================================

Total interest income was $8.8 million in fiscal 1998, $3.4 million in 
fiscal 1997 and $2.5 million in fiscal 1996.

Cash payments for interest, net of amounts capitalized, totaled $17.1 
million in fiscal 1998, $18.9 million in fiscal 1997 and $20.7 million 
in fiscal 1996.


Note 3:  Unusual Items

Fiscal 1998

The Company recognized a pre-tax charge of $5.0 million ($3.2 million 
after tax or 17 cents per share) as a result of a determination that 
receivables from a major customer of the Company's former food exporting 
business may not be fully recoverable.  See Note 12 for additional 
discussion.

Fiscal 1997

The Company recognized unusual items that resulted in pre-tax charges of 
$20.1 million ($14.8 million after tax or 83 cents per share) and were 
comprised of the following:

(in millions)                                   Segment
-----------------------------------------------------------------------
Asset impairment                 $11.4     North America Foods
Restructuring plan                 4.0     Multifoods Distribution Group
Severance and other costs          3.6     Corporate
Facility consolidation plan        1.1     Multifoods Distribution Group
------------------------------------------------------------------------
  Total                          $20.1
=======================================

The Company recognized a charge of $11.4 million for asset impairment in 
its Canadian frozen bakery operation.  The impairment resulted in a $9.6 
million reduction in goodwill and a $1.8 million reduction in fixed 
assets.  During fiscal 1997, the operation experienced a significant 
increase in competition in certain key markets.  As a result, there was 
a significant decline in sales volume and operating results.  The 
Company reviews its long-lived assets and goodwill for impairment 
whenever changes in circumstances indicate that the carrying amount of 
an asset or group of assets may not be recoverable.  In this situation, 
the Company believes that the operating unit is the lowest level for 
which identifiable cash flows could be determined.  Accordingly, the 
Company estimated the fair value of the operation's assets using 
discounted expected future cash flows and determined that the carrying 
value of the business unit exceeded the fair value.  In estimating 
future cash flows, considerable management judgment is necessary, and 
actual results could vary significantly from such estimates.

Management adopted a restructuring plan at its vending distribution 
business directed at improving customer service.  The plan included 
moving certain customer support functions from a central location to the 
distribution centers.  Accordingly, the Company recorded a $2.8 million 
charge primarily from losses on lease commitments and a $1.2 million 
charge for involuntary employee termination benefits covering 
approximately 190 customer support employees.  All significant actions 
related to the plan were completed in fiscal 1998.

The Company recognized $2.2 million in severance and other costs 
resulting from the resignation of the Company's former chief executive 
officer and $1.4 million principally for costs of business assessment 
studies.

Management adopted a plan to consolidate two foodservice distribution 
centers.  As a result, the Company recorded a $1.1 million charge for 
the loss on lease commitments and employee termination benefits.  
Involuntary employee termination benefits covered approximately 40 
warehouse, delivery and administrative employees.  All significant 
actions related to the plan were completed in fiscal 1998.

Fiscal 1996

The Company recognized unusual items that resulted in a net pre-tax 
charge of $5.7 million ($0.5 million after-tax benefit or 2 cents per 
share) and were comprised of the following:

(in millions)                                    Segment
-----------------------------------------------------------------------
Write-down of software costs      $8.9    Multifoods Distribution Group
Corporate restructuring plan       6.2    Corporate
Lease commitment loss               .5    Multifoods Distribution Group
Gain on business divestiture      (9.9)   Divested Businesses
-----------------------------------------------------------------------
Total                             $5.7
=======================================

The Company recognized an $8.9 million charge for the write-down of 
vending distribution computer software costs.  The charge resulted from 
the Company's decision to limit the scope of the software applications 
being implemented.  In addition, a $0.5 million charge for a loss on a 
lease commitment was also recognized in the vending distribution 
business.

The Company recognized charges of $2.0 million for asset write-downs and 
$4.2 million for termination benefits in order to streamline corporate 
administrative operations.  All significant actions relating to the plan 
were completed in fiscal 1997.

The Company divested its surimi seafood business in June 1995 for a $9.9 
million gain.

The Company recognized a $5.0 million tax benefit that resulted from an 
agreement with the IRS regarding proposed disallowances of certain 
deductions taken during fiscal years 1985 through 1991 and the benefit 
of the closure by the IRS of its examinations of the Company's fiscal 
1992 and 1993 tax returns.


Note 4:  Income Taxes

Income tax expense was as follows:

                                 U.S. Operations    Non-U.S.
(in thousands)                   Federal    Other   Operations    Total
------------------------------------------------------------------------
1998:
  Current expense (benefit)      $  (229) $   283    $ 9,831    $ 9,885
  Deferred expense (benefit)       3,240    1,472     (2,226)     2,486
-----------------------------------------------------------------------
    Total tax expense            $ 3,011  $ 1,755    $ 7,605    $12,371
=======================================================================
1997:
  Current expense (benefit)      $(7,976) $    57    $ 6,903    $(1,016)
  Deferred expense (benefit)       3,385     (440)       307      3,252
------------------------------------------------------------------------
    Total tax expense (benefit)  $(4,591) $  (383)   $ 7,210    $ 2,236
========================================================================
1996:
  Current expense (benefit)      $(4,336) $  (442)   $ 3,913    $  (865)
  Deferred expense (benefit)       2,501     (922)     2,965      4,544
------------------------------------------------------------------------
    Total tax expense (benefit)  $(1,835) $(1,364)   $ 6,878    $ 3,679
========================================================================

Temporary differences that gave rise to deferred tax assets and 
liabilities as of February 28, 1998 and 1997, were as follows:

                                      1998                    1997      
                            -------------------     --------------------
                            Deferred   Deferred     Deferred   Deferred
                              Tax       Tax           Tax        Tax
(in thousands)               Assets  Liabilities    Assets   Liabilities
------------------------------------------------------------------------
Depreciation and
  amortization                $ 1,483   $29,247      $ 1,633    $28,256
Accrued expenses               20,952    11,738       21,429     11,055
Inventory valuation methods       743         -          974          -
Reorganization and 
  divestiture reserves            637         -        3,640          -
Provision for losses
  on receivables                3,571         -        3,263          -
Loss carryforwards              7,137         -        4,591          -
Foreign earnings repatriation       -     3,139            -      3,027
Other                           4,631     2,246        2,983      2,558
------------------------------------------------------------------------
    Subtotal                   39,154    46,370       38,513     44,896
Valuation allowance            (1,111)        -       (2,420)         -
------------------------------------------------------------------------
      Total deferred taxes    $38,043   $46,370      $36,093    $44,896
========================================================================

At February 28, 1998, the Company had a U.S. federal consolidated net 
operating loss carryforward of approximately $7.9 million that will 
expire in fiscal 2013.  The Company's foreign operations had net 
operating loss carryforwards of approximately $3.2 million that will 
expire in fiscal 2005.  The Company's foreign operations also had 
capital loss carryforwards of approximately $3.6 million that have no 
expiration date.  The Company expects to fully utilize the net operating 
and capital loss carryforwards.

In fiscal 1998, the Company's valuation allowance decreased 
approximately $1.3 million.  Approximately $0.9 million of the decrease 
resulted from a change in the expected utilization of the net operating 
loss carryforwards of the Company's foreign operations.  The remaining 
decrease resulted from a decline in Venezuelan deferred tax assets and 
had no effect on income tax expense.

Total income taxes differ from the amount computed by applying the U.S. 
federal income tax rate because of the following items:

 (in thousands)                               1998      1997      1996
------------------------------------------------------------------------
Tax at U.S. federal statutory rate (35.0%)  $11,338    $1,756    $9,714

Differences:
  Effect of taxes on non-U.S. earnings         (130)      176    (2,049)
  State and local income taxes                1,141      (249)     (887)
  Effect of intangibles                         137       148       209
  Basis difference for business disposals        -          -       355
  Resolution of tax examinations                 -          -    (5,000)
  Other                                        (115)      405     1,337
------------------------------------------------------------------------
    Total income taxes                      $12,371    $2,236    $3,679
========================================================================

Provision has been made for U.S. income taxes applicable to anticipated 
remittances of earnings from non-U.S. affiliates.  It is not practicable 
to estimate the remaining deferred tax liability associated with 
temporary differences related to investments in non-U.S. affiliates.  
Earnings before income taxes from non-U.S. affiliates were $22.1 million 
in fiscal 1998, $21.5 million in fiscal 1997 and $28.4 million in fiscal 
1996.

Cash paid (received) for income taxes totaled $(0.9) million in fiscal 
1998, $6.7 million in fiscal 1997 and $4.8 million in fiscal 1996.

Note 5:  Earnings Per Share

The Company adopted SFAS No. 128 "Earnings Per Share" in fiscal 1998.  
The table below reconciles average shares outstanding used to compute 
basic and diluted earnings per share.  There was no earnings impact for 
the assumed conversion of stock options in each of the fiscal years.
<TABLE>
<CAPTION>
                                  1998                1997                1996     
                            ---------------     ---------------     ---------------
(in thousands, except       Average     Per     Average     Per     Average     Per
per share data)             Shares    Share     Shares    Share     Shares    Share
-----------------------------------------------------------------------------------
<S>                         <C>       <C>       <C>       <C>       <C>       <C>
Basic E.P.S.                18,385    $1.09     17,982    $ .15     17,965    $1.33

Effect of 
  Stock Options                234        -          5        -         49        -
-----------------------------------------------------------------------------------
Diluted E.P.S.              18,619    $1.08     17,987    $ .15     18,014    $1.32
-----------------------------------------------------------------------------------
</TABLE>

Note 6:  Supplemental Balance Sheet Information

(in thousands)                                      1998            1997
------------------------------------------------------------------------
Trade accounts receivable, net:
 Trade                                          $148,947        $216,798
 Allowance for doubtful accounts                  (4,746)         (9,339)
------------------------------------------------------------------------
   Total trade accounts receivable, net         $144,201        $207,459
========================================================================

Inventories:
  Raw materials, excluding grain                $ 19,823        $ 15,776
  Grain                                           87,769          86,500
  Finished and in-process goods                  151,894         174,274
  Packages and supplies                            6,503           7,398
------------------------------------------------------------------------
    Total inventories                           $265,989        $283,948
========================================================================
Property, plant and equipment, net:
  Land                                          $ 15,123        $ 13,413
  Buildings and improvements                      98,204          93,099
  Machinery and equipment                        235,906         228,514
  Transportation equipment                         5,883           7,194
  Improvements in progress                        16,969          15,019
------------------------------------------------------------------------
                                                 372,085         357,239
  Accumulated depreciation                      (151,518)       (131,882)
------------------------------------------------------------------------
    Total property, plant and equipment, net    $220,567        $225,357
========================================================================
Other current liabilities:
  Wages and benefits                            $ 18,510        $ 12,445
  Income taxes                                    13,784          12,946
  Other accrued expenses                          36,562          44,646
------------------------------------------------------------------------
    Total other current liabilities             $ 68,856        $ 70,037
========================================================================


Note 7:  Financial Instruments

Fair value of financial instruments  

The carrying value of cash and cash equivalents, accounts receivable, 
accounts payable and short-term debt approximate fair value.  The 
Company's $90 million carrying value of medium-term notes, $23 million 
of which is classified as current, had a fair value of $87 million as of 
February 28, 1998.

Commodity risk management  

The Company's Canadian operations minimize the risk associated with 
wheat market price fluctuations by hedging its wheat and flour 
inventories, open wheat purchase contracts and open flour sales 
contracts with wheat futures contracts.  In the United States, the 
Company has entered into futures to reduce the risk of price 
fluctuations on anticipated flour and soybean oil purchases.  The U.S. 
dollar-denominated futures contracts are traded on U.S. regulated 
exchanges.  The amount of deferred gains, measured by using quoted 
market prices as of February 28, 1998, was immaterial.  At February 28, 
1998, the Company held futures to purchase wheat and soybean oil with an 
aggregate contract value of $17.1 million.  The open futures mature in 
the period from March 1998 through December 1998 and substantially 
coincide with the maturities of the open wheat purchase contracts, open 
flour sales contracts and the anticipated timing of flour and soybean 
oil purchases.

Foreign currency hedging

As the Company's Canadian operations' inventories, purchase contracts 
and sales contracts are generally denominated in Canadian dollars, the 
Company enters into foreign exchange forward contracts that have the 
effect of converting the U.S. dollar-denominated futures contracts (see 
Commodity risk management) into Canadian dollar equivalents.  At 
February 28, 1998, the Company held foreign exchange forward contracts 
to sell and buy U.S. dollars totaling $5.5 million and $13.5 million, 
respectively.  The foreign exchange forward contracts are purchased 
through major Canadian banking institutions.

The Company's Canadian operations also purchase foreign currency forward 
contracts to minimize its exposure to foreign currency fluctuations as a 
result of U.S. dollar-denominated sales to customers.  As of February 
28, 1998, the aggregate notional amount of these contracts in U.S. 
dollars was $16.2 million, and the losses on such contracts were 
insignificant.  The gains and losses arising on these transactions are 
recognized in income at the maturity of the contracts.

Interest rate risk management

In December 1997, the Company entered into a five-year interest-rate 
swap contract commencing March 2, 1998, and expiring March 3, 2003.  
Under the terms of the agreement, the Company will make quarterly 
payments based on a $20 million notional amount at a fixed rate of 
6.175%.  In return, the Company will receive a floating rate payment 
based on the current three-month London Interbank Offered Rate (LIBOR).  
The net amount received or paid under the terms of the contract will be 
classified as interest expense.

In December 1997, the Company also entered into a $20 million notional 
value 10-year forward Treasury lock at a rate of 5.815% with a 
settlement date of July 15, 1998.  At the settlement date, the 
instrument is priced based on the then-current 10-year U.S. Treasury 
yield.  The agreement provides for the Company to receive a payout if 
rates rise above 5.815% and to make a payment if rates fall below 
5.815%.  The result of this settlement will be amortized into interest 
expense.

Off-balance sheet risk  

As of February 28, 1998 and 1997, the Company had sold with limited 
recourse $21.2 million and $14.6 million of accounts receivable, 
respectively, related to its Canadian operations.  Collections received 
on these accounts may be replaced by new receivables in order to 
maintain the aggregate outstanding balance.  The credit risk of 
uncollectible accounts has been substantially transferred to the 
purchaser.  Fees associated with these transactions are included in 
other income (expense), net in the consolidated statements of earnings.

Concentrations of credit risk  

Management believes the credit risk of exchange-traded futures 
contracts, foreign exchange forward contracts and interest rate 
contracts due to nonperformance of the counterparties is insignificant.

The Company extends credit on a regular basis under various terms to 
customers that meet certain financial and other criteria.  In general, 
the Company does not require collateral or security. The Company 
believes that its trade receivables do not represent significant 
concentrations of credit risk due to the large number of customers and 
markets into which its products are sold, as well as their dispersion 
across geographic areas.

The Company has a carrying value of $10.3 million ($15.7 million net of 
a $5 million reserve) in notes and accounts receivable from a major 
customer of the Company's former food exporting business.  See Note 12 
for further discussion.

Note 8:  Notes Payable

Notes payable consisted of the following:

(in thousands)                                    1998            1997
-----------------------------------------------------------------------
U.S. commercial paper                          $     -        $  1,200
Canadian bankers' acceptances                   15,451          43,854
Notes payable, principally to banks             80,303         154,077
Amounts reclassified to long-term debt         (94,729)       (110,930)
-----------------------------------------------------------------------
  Total notes payable                          $ 1,025        $ 88,201
=======================================================================

The Company has a $200 million revolving credit agreement in the U.S. 
and an $80 million revolving credit agreement in Canada that expire 
March 15, 2001. The Company had available $251 million under these 
revolving credit agreements as of February 28, 1998.  The interest rate 
on borrowings under these agreements is variable and based on current 
market factors.  There are no restrictions on the use of these 
facilities for general corporate purposes and support for commercial 
paper issued by the Company.  The credit agreements contain certain 
restrictive covenants that include maintenance of minimum tangible net 
worth, a fixed charge coverage ratio and an indebtedness to 
capitalization ratio.  None of the restrictive covenants is expected to 
affect the payment of dividends based on the Company's present dividend 
rate.  Related facility fees were $0.4 million in fiscal 1998 and 1997.

Notes payable totaling $94.7 million have been classified as long-term 
debt as a result of the Company's intent to refinance this debt on a 
long-term basis and the availability of such financing under the terms 
of the revolving credit agreements.

The weighted average interest rate on notes payable outstanding at 
February 28, 1998 and 1997, was 6.0% and 5.7%, respectively.

At February 28, 1998, the Company had total uncommitted lines of credit 
from banks in the United States and Venezuela of approximately $288 
million, of which $208 million was available.  No compensating balances 
were required for any of these credit lines.

Note 9: Long-Term Debt

Long-term debt, net of current portion of $25.0 million in fiscal 1998 
and $6.8 million in fiscal 1997, was as follows:

(in thousands)                                           1998       1997
------------------------------------------------------------------------
Medium-term notes                                    $ 67,000   $ 90,000
Other                                                   1,128      1,398
Notes payable, reclassified                            94,729    110,930
------------------------------------------------------------------------
  Total long-term debt                               $162,857   $202,328
========================================================================

The Company maintains a shelf registration statement with the Securities 
and Exchange Commission for the issuance of $150 million of debt 
securities, of which $140 million remained available at February 28, 
1998.  The Company may issue up to the entire amount as medium-term 
notes, Series B, in varying amounts, rates and maturities.  Medium-term 
notes outstanding at February 28, 1998, mature in fiscal 1999 to 2006 
and had a weighted average interest rate of 6.6%.

Minimum principal payments totaling $162.9 million are due as follows: 
$2.3 million in fiscal 2000, $20.3 million in fiscal 2001, $95.1 million 
in fiscal 2002, $1.2 million in fiscal 2003, $14.0 million in fiscal 
2004 and $30.0 million in fiscal 2005 and beyond.

Note 10: Preferred Capital Stock

The Company has authorized 10,000,000 shares of Preferred Capital Stock, 
par value $1.00 per share, which may be designated and issued as 
convertible into common shares.  The Company has created a series of 
such Preferred Capital Stock, designated as Series 1990 Junior 
Participating Capital Preferred Stock, consisting of 500,000 shares, par 
value $1.00 per share.

No Preferred Capital Stock was outstanding during the three years ended 
February 28, 1998.


Note 11:  Leases

The Company leases certain plant, office space and equipment for varying 
periods.  Management expects that in the normal course of business, 
leases will be renewed or replaced by other leases.

The following is a schedule of future minimum lease payments for 
operating leases that had initial or remaining noncancelable lease terms 
in excess of one year as of February 28, 1998:

                                                   Operating
(in thousands)                                       Leases
------------------------------------------------------------
1999                                                $19,295
2000                                                 14,732
2001                                                  9,708
2002                                                  5,370
2003                                                  2,341
2004 and beyond                                       1,696
-----------------------------------------------------------
  Total minimum lease payments *                    $53,142
===========================================================

* Minimum payments do not include contingent rentals or vehicle lease 
payments based on mileage.

Total net rent expense for operating leases, including those with 
terms of less than one year, consisted of the following:

(in thousands)                            1998       1997       1996
---------------------------------------------------------------------
Minimum rentals                        $28,508    $28,181    $29,104
Contingent rentals                          99         29         79
Sublease rentals                           (94)        (2)        (8)
---------------------------------------------------------------------
  Total net rent expense               $28,513    $28,208    $29,175
=====================================================================

Note 12:  Commitments and Contingencies

In fiscal 1998, the Company entered into an exit agreement with a major 
customer of the Company's former food exporting business.  The terms of 
the exit agreement have been restructured on several occasions because 
of the customer's financial difficulties, which the Company believes 
were caused by delays in moving product into the Russian marketplace.  
As of February 28, 1998, the Company had a note receivable from the 
customer of $10.7 million and accounts receivable of $4.6 million.  The 
current agreement provides for payments on the accounts receivable 
balance totaling $3.0 million by June 1998 with the remaining balance 
added to the note receivable.  The note receivable has a term of 60 
months, bears interest at 8.5% and provides for monthly payments of 
interest only for the first 12 months, followed by 48 monthly payments 
of interest and principal in equal installments.  As a result of 
uncertainities with respect to the customer's ability to meet its 
obligations, the Company recognized a $5.0 million pre-tax charge in the 
fourth quarter of fiscal 1998 to reduce the carrying value of the 
receivables to their estimated net realizable value.  In estimating the 
net realizable value, considerable management judgment is necessary and, 
accordingly, future events may result in additional charges that could 
be material to the Company's results of operations.

In fiscal 1998, the Company was notified that approximately $6 million 
in Company-owned inventory was stolen from a ship in the port of St. 
Petersburg, Russia. The ship had been chartered by the major customer of 
the Company's former food exporting business. The Company believes, 
based on the facts known to date, that the loss is covered by insurance.  
If the loss from the theft of product is not covered by insurance, the 
Company would likely recognize a material charge to its results of 
operations. 

In February 1998, the Company signed an exclusive supply agreement with 
a customer in Venezuela that requires the Company to guarantee debt 
obligations of up to $6.8 million.  The customer has pledged certain 
assets that have an estimated market value in excess of the guarantee.  
It is not practicable to estimate the fair value of the guarantee; 
however, the Company does not expect that it will incur losses as a 
result of this guarantee.

At February 28, 1998, the estimated cost to complete improvements in 
progress totaled approximately $10 million.  


Note 13: Shareholders' Equity

The following summarizes the changes in shareholders' equity for the 
three years ended February 28, 1998:

<TABLE>
<CAPTION>
                                                                                 Equity Adjustment from:
                                       $.10 par value                            -----------------------
                                      ----------------     Capital in             Foreign      Minimum 
                                     Common    Treasury    Excess of  Retained    Currency     Pension     Unearned
(in thousands)                        Stock       Stock    Par Value  Earnings    Translation  Liability  Compensation   Total
------------------------------------------------------------------------------------------------------------------------------
<S>                                  <C>       <C>           <C>      <C>         <C>          <C>           <C>      <C>
Balance at February 28, 1995         $2,184    $(83,417)     $88,862  $395,406    $(108,884)   $(1,641)      $(1,448) $291,062
  Net earnings                            -           -            -    24,075            -          -             -    24,075
  Translation adjustments                 -           -            -         -          714          -             -       714
  Dividends declared:
    Common stock                          -           -            -   (14,408)           -          -             -   (14,408)
    Preferred stock                       -           -            -      (260)           -          -             -      (260)
  137 shares purchased for treasury       -      (2,877)           -         -            -          -             -    (2,877)
  108 shares issued for 
    employee benefit plans                -       2,346         (277)        -            -          -          (311)    1,758
  Amortization of unearned
    compensation                          -           -            -         -            -          -           532       532
  Adjustment associated
    with long-term incentive
    program amendment                     -           -         (269)        -            -          -           269         -
  Adjustment associated with
    recognition of minimum
    pension liability                     -           -            -         -            -     (1,033)            -    (1,033)
-------------------------------------------------------------------------------------------------------------------------------
Balance at February 29, 1996          2,184     (83,948)      88,316   404,813     (108,170)    (2,674)         (958)  299,563
  Net earnings                            -           -            -     2,780            -          -             -     2,780
  Translation adjustments                 -           -            -         -          170          -             -       170
  Dividends declared on
    common stock                          -           -            -   (14,258)           -          -             -   (14,258)
  5 shares purchased for treasury         -         (82)           -         -            -          -             -       (82)
  35 shares issued for 
    employee benefit plans                -         768         (192)        -            -          -          (569)        7
  Amortization of unearned
    compensation                          -           -            -         -            -          -         1,033     1,033
  Adjustment associated with
    recognition of minimum
    pension liability                     -           -            -         -            -        365             -       365 
-------------------------------------------------------------------------------------------------------------------------------
Balance at February 28, 1997          2,184     (83,262)      88,124   393,335     (108,000)    (2,309)         (494)  289,578
  Net earnings                            -           -            -    20,024            -          -             -    20,024
  Translation adjustments                 -           -            -         -       (2,812)         -             -    (2,812)
  Dividends declared on
    common stock                          -           -            -   (14,605)           -          -             -   (14,605)
  36 shares purchased for treasury        -        (799)           -         -            -          -             -      (799)
  764 shares issued for 
    employee benefit plans                -      16,581        3,216         -            -          -        (1,289)   18,508
  Amortization of unearned
    compensation                          -           -            -         -            -          -           649       649
  Adjustment associated with
    recognition of minimum
    pension liability                     -           -            -         -            -     (1,190)            -    (1,190)
------------------------------------------------------------------------------------------------------------------------------
Balance at February 28, 1998         $2,184    $(67,480)     $91,340  $398,754    $(110,812)   $(3,499)      $(1,134) $309,353
==============================================================================================================================
</TABLE>

The 1997 stock-based plan and the 1989 stock-based plan of the Company 
permit awards of restricted stock and incentive units to directors and 
key employees subject to the provisions of the plans and as determined 
by the Compensation Committee of the Board of Directors.  In fiscal 
1998, grants of 3,450 shares of restricted stock were awarded with 
varying performance criteria and vesting periods.  At February 28, 1998, 
the total number of restricted shares outstanding was 59,479. The market 
value of shares issued under the plans, as of the date of grant, has 
been recorded as unearned compensation and is shown as a separate 
component of shareholders' equity. Unearned compensation is expensed 
over the period that restrictions lapse.

The Company has a shareholder rights plan that entitles one preferred 
share purchase right for each outstanding share of common stock.  The 
rights become exercisable only after a person or group (with certain 
exceptions) becomes the beneficial owner of 10% or more of the Company's 
outstanding common stock or announces a tender offer, the consummation 
of which would result in beneficial ownership by a person or group of 
10% or more of the Company's outstanding common stock. Each right will 
entitle its holder to purchase one one-hundredth share of Series 1990 
Junior Participating Preferred Capital Stock (consisting of 500,000 
shares, par value $1.00 per share) at an exercise price of $100, subject 
to adjustment. If a person or group acquires beneficial ownership of 10% 
or more of the Company's outstanding common stock, each right will 
entitle its holder (other than such person or group) to purchase, at the 
then-current exercise price of the right, a number of shares of the 
Company's common (or, in certain circumstances, preferred) stock having 
a market value of twice the then-current exercise price of the right.  
In addition, if the Company is acquired in a merger or other business 
combination transaction or if 50% or more of its consolidated assets or 
earnings power are acquired, each right will entitle its holder to 
purchase, at the then-current exercise price of the right, a number of 
the acquiring company's common shares having a market value of twice the 
then-current exercise price of the right.  Following the acquisition by 
a person or group of beneficial ownership of 10% or more of the 
Company's outstanding common stock and prior to an acquisition by any 
person or group of 50% or more of the Company's outstanding common 
stock, the Board of Directors may exchange the outstanding rights (other 
than rights owned by such person or group), in whole or in part, for 
common (or, in certain circumstances, preferred) stock of the Company.  
Prior to the acquisition by a person or group of beneficial ownership of 
10% or more of the Company's outstanding common stock, the rights are 
redeemable for $.01 per right at the option of the Board of Directors.


Note 14: Stock Options

Stock options are granted to directors, officers and key management 
employees to purchase shares of Company common stock generally at not 
less than fair market value at dates of grant.  Options generally become 
exercisable one year after the date of grant and expire 10 years after 
the date of grant.

At February 28, 1998, a total of 409,476 common shares were available 
for grants of stock options or restricted stock under the Company's 1989 
and 1997 stock-based plans.


The per share weighted average fair values of stock options granted were 
$4.28 in fiscal 1998, $4.40 in fiscal 1997 and $4.87 in fiscal 1996.  
The fair value of options at the date of grant was estimated using the 
Black-Scholes option pricing model.  The following assumptions were 
used in the calculation:


Assumptions                     1998             1997            1996
----------------------------------------------------------------------
Expected dividend yield         4.0%             3.8%            3.5%
Expected volatility            20.7%            19.8%           19.9%
Risk-free interest rates   5.7% to 6.8%     6.5% to 7.0%   6.1% to 7.0%
Expected life (in years)        8.3              8.3             7.7
----------------------------------------------------------------------

The Company applies APB Opinion No. 25 in accounting for the 
compensation cost of employee stock options in the financial statements.  
Had the Company determined compensation cost based on the fair value at 
the date of grant for its stock options under SFAS 123, the Company's 
net earnings would have been reduced to the pro forma amounts indicated 
below:

(in thousands, except per share data)      1998     1997       1996
--------------------------------------------------------------------
Net earnings:
   As reported                          $20,024   $2,780    $24,075
   Pro forma                             19,265    2,370     23,519

Basic earnings per share:
   As reported                          $  1.09   $  .15    $  1.33
   Pro forma                               1.05      .13       1.30
--------------------------------------------------------------------
The following table contains information on stock options:

                                            Option Price
                             Shares        Per Share-Range
----------------------------------------------------------
Outstanding at
  February 28, 1995        1,567,829        $14.97 - 29.00
Granted                      220,513         18.69 - 22.69
Exercised                    (83,545)        14.97 - 20.17
Expired or canceled         (137,975)        16.50 - 28.06
----------------------------------------------------------
Outstanding at
  February 29, 1996        1,566,822        $16.06 - 29.00
Granted                      273,509         16.00 - 20.81
Exercised                    (30,250)        16.63 - 19.21
Expired or canceled         (285,050)        16.75 - 28.06
----------------------------------------------------------
Outstanding at 
  February 28, 1997        1,525,031        $16.00 - 29.00
Granted                      583,066         18.19 - 27.69
Exercised                   (731,451)        16.75 - 28.06
Expired or canceled          (40,150)        18.69 - 28.06
----------------------------------------------------------
Outstanding at 
  February 28, 1998        1,336,496        $16.00 - 29.00
==========================================================
Options exercisable at:
February 29, 1996          1,383,422        $16.06 - 29.00
February 28, 1997          1,321,281        $16.06 - 29.00
February 28, 1998            831,396        $16.00 - 29.00
----------------------------------------------------------

Note 15:  Retirement Plans

The Company sponsors two defined contribution plans and several defined 
benefit retirement plans.

The defined contribution plans cover substantially all salaried, sales 
and certain hourly employees in the United States and Canada.  The 
Company makes contributions equal to 50% of the participating employee's 
contributions subject to certain limitations.  Employer contributions, 
which are invested in shares of the Company's common stock, were $2.0 
million in fiscal 1998, $2.1 million in fiscal 1997 and $1.8 million in 
fiscal 1996.

In the United States and Canada, defined benefit plans cover 
substantially all employees.  Benefits are based primarily on years of 
credited service and average compensation or stated amounts for each 
year of service.  These plans are generally funded by contributions to 
tax-exempt trusts in amounts sufficient to provide assets to cover the 
plans' obligations. Plan assets consist principally of listed equity 
securities, fixed income securities and cash equivalents.

Net pension credit for the defined benefit plans was as follows:

(in thousands)                         1998        1997        1996
--------------------------------------------------------------------
Service costs                       $ 2,492     $ 2,492     $ 1,946
Interest costs                       12,883      12,438      12,767
Actual return on plan assets        (45,148)    (30,382)    (39,431)
Net amortization and deferral        28,681      14,834      23,891
--------------------------------------------------------------------
  Net pension credit                $(1,092)    $  (618)    $  (827)
====================================================================


The funded status of the defined benefit plans and the amounts 
recognized in the balance sheets were as follows:

                                   1998                     1997
                            -------------------      -------------------
                            Assets      Benefit      Assets      Benefit
                            Exceed        Obli-      Exceed        Obli-
                           Benefit      gations     Benefit      gations
                             Obli-       Exceed       Obli-       Exceed
(in thousands)             gations       Assets     gations       Assets
------------------------------------------------------------------------
Actuarial present value
  of benefit obligations:
    Vested                $169,799     $ 15,355    $148,102     $ 11,169
    Nonvested                3,408          663       2,753        1,926
------------------------------------------------------------------------
Accumulated benefit
  obligations              173,207       16,018     150,855       13,095
Effect of future 
  salary increases           4,402            -       6,227          351
------------------------------------------------------------------------
Projected benefit 
  obligations              177,609       16,018     157,082       13,446
Plan assets at 
  fair value               231,032            -     202,131            -
------------------------------------------------------------------------
Plan assets in
  excess of (less 
  than) projected 
  benefit obligations       53,423      (16,018)     45,049      (13,446)
Unamortized prior
  service cost               4,864            -       5,217            -
Unrecognized effect 
  from past experience
  different from that
  assumed                  (21,119)       5,744     (13,899)       4,145
Unrecognized transition  
  (assets) obligations,
  net of amortization       (7,663)           -      (9,428)           -
Adjustment required 
  to recognize minimum
  pension liability              -       (5,744)          -       (3,794)
------------------------------------------------------------------------
      Prepaid (accrued)
        pension costs     $ 29,505     $(16,018)   $ 26,939     $(13,095)
=========================================================================

The Company amortizes prior service costs and unrecognized gains and 
losses on a straight-line basis over not more than 16 years. Other 
assumptions used, which reflect weighted averages of the U.S. and 
Canadian defined benefit plans, were as follows:

                                                         1998      1997
-----------------------------------------------------------------------
Discount rate                                             6.7%     7.6%
Expected long-term return rate on assets                  9.5%     9.5%
Rate of increase in future compensation                   4.0%     4.0%
-----------------------------------------------------------------------

In Venezuela, all employees are entitled to certain severance 
indemnities based on compensation and cause of separation. This post-
employment arrangement qualifies as a defined benefit plan under the 
provisions of Statement of Financial Accounting Standards No. 87, 
"Employers' Accounting for Pensions."  The Company has elected to define 
the vested benefit obligation for this arrangement as the actuarial 
present value of vested benefits the employee is entitled to if 
immediately separated at the measurement date. This arrangement has not 
been funded, and the corresponding expense recognized was $3.6 million 
in fiscal 1998, $2.9 million in fiscal 1997 and $3.8 million in fiscal 
1996.


Note 16:  Post-Retirement Health and Life Insurance Benefits

The Company provides post-retirement health and life insurance benefits 
for retirees in the United States and Canada who meet minimum age and 
service requirements. The costs of the U.S. life insurance benefits are 
funded over the employees' active working lives through contributions to 
an insurance continuation fund maintained by an insurance company. Life 
insurance benefits for Canadian retirees are funded on a pay-as-you-go 
basis through an insurance company.  Health-care benefits for U.S. and 
Canadian retirees are provided under a self-insured program administered 
by an insurance company.

The net periodic post-retirement benefit cost (credit) was as follows:

(in thousands)                               1998      1997      1996
---------------------------------------------------------------------
Service costs                              $  356    $  474    $  222
Interest costs                              1,154     1,351       999
Net amortization and deferral                (861)   (1,417)   (1,785)
---------------------------------------------------------------------
    Net post-retirement 
      benefits cost (credit)               $  649    $  408    $ (564)
=====================================================================

In addition to the net post-retirement benefit cost, the Company 
recorded a $2.9 million curtailment gain in fiscal 1998.  The 
curtailment gain resulted from the Company's decision to eliminate 
subsidized retiree medical coverage for most of its active employees in 
the United States.  Employees affected by this change who meet certain 
age and service requirements at the time of retirement can elect 
coverage under Company-sponsored retiree medical plans by paying the 
full cost of such plans.

The actuarial present value of benefit obligations and the amounts 
recognized in the consolidated balance sheets were as follows:

(in thousands)                                      1998       1997
-------------------------------------------------------------------
Actuarial present value of benefit obligations:
  Retirees                                       $11,159    $12,952
  Fully eligible active plan participants          1,137      1,640
  Other active plan participants                   1,515      3,930
-------------------------------------------------------------------
Accumulated benefit obligations                   13,811     18,522
Plan assets at fair value                              -        535
-------------------------------------------------------------------
Accumulated obligation in excess of plan assets   13,811     17,987
Unrecognized effect from past experience
  different from that assumed                        220     (1,319)
Unrecognized effect from plan amendments            (348)       443
-------------------------------------------------------------------
    Accrued post-retirement cost                 $13,683    $17,111
===================================================================

The assumed annual rate of future increases in per capita cost of 
health-care benefits ranged from 4% to 8.8% for each of the next five 
years and 4% thereafter.  These trend rates reflect the Company's prior 
experience, plan provisions and management's expectation of future 
rates.  Increasing the health-care cost trend by 1% in each year would 
result in an insignificant change to the accumulated benefit obligation 
and the service and interest costs.  The weighted average discount rates 
used were 6.8% and 7.6% in fiscal 1998 and 1997, respectively.

Note 17:  Multifoods' Business Segments

The Company's business segments are Multifoods Distribution Group, North 
America Foods, Venezuela Foods and Divested Businesses.  In fiscal 1998, 
the Company changed the name of its Foodservice Distribution segment to 
Multifoods Distribution Group.  In addition, the Company changed the 
reporting of its former food exporting business results from the 
Multifoods Distribution Group to the Divested Businesses segment.  
Fiscal 1997 and 1996 segment financial information has been reclassified 
to conform with the fiscal 1998 presentation.  

Multifoods Distribution Group includes the Company's vending and 
foodservice distribution businesses.  The foodservice distribution 
business was formerly referred to as limited-menu distribution.  The 
vending distribution business is the largest U.S. distributor of food 
products to vending and office coffee service operators.  The 
foodservice distribution business is a distributor in the United States 
to foodservice operators.  The foodservice business distributes a broad 
selection of items, including food products, paper goods and cleaning 
supplies.  

North America Foods consists of two groups, U.S. Foods and Robin Hood 
Multifoods.  U.S. Foods markets bakery products, such as bakery mixes 
and frozen desserts, to commercial customers in the United States.  
Robin Hood Multifoods sells flour, bakery mixes and condiments to 
consumer and commercial customers primarily in Canada.  As of February 
28, 1998, the Company had approximately $84 million of net assets 
located in Canada.  

Venezuela Foods includes consumer foods, commercial foods and animal 
feeds.  The business provides grain-based products to consumers, food 
processors, and commercial and retai bakeries.  Principal consumer 
products include wheat flour, corn flour, whole grain rice and rice 
flour.  The Company's operations in Venezuela are subject to risks 
inherent in operating under a different legal and political system along 
with a difficult economic environment.  Among these risks are inflation, 
currency volatility, possible limitations on foreign investment, 
exchangeability of currency, dividend repatriation and changes in 
existing tax laws.  The Company's Venezuelan operations are also 
dependent on raw material imports for many of its products.  As of 
February 28, 1998, the Company had approximately $70 million of net 
assets located in Venezuela.  

Divested Businesses consists of the surimi seafood business, which was 
divested in fiscal 1996, and the food exporting business, which was 
divested in fiscal 1998.  

<TABLE>
<CAPTION>
                                                                    Operating
                                      Net     Operating   Unusual    Earnings
(in millions)                        Sales      Costs      Items      (Loss)
----------------------------------------------------------------------------
<S>                               <C>        <C>          <C>         <C>
1998:
  Multifoods Distribution Group   $1,770.2   $(1,746.5)   $    -      $ 23.7
  North America Foods                471.7      (441.1)        -        30.6
  Venezuela Foods                    360.7      (360.9)        -         (.2)
  Divested Business                    9.2        (4.8)     (5.0)        (.6)
  Corporate Expenses                     -        (8.7)        -        (8.7)
----------------------------------------------------------------------------
    Total                         $2,611.8   $(2,562.0)   $ (5.0)     $ 44.8
============================================================================
1997:
  Multifoods Distribution Group   $1,729.9   $(1,725.0)   $ (5.1)     $  (.2)
  North America Foods                476.7      (455.9)    (11.4)        9.4
  Venezuela Foods                    346.8      (328.2)        -        18.6
  Divested Business                   42.5       (34.8)        -         7.7
  Corporate Expenses                     -        (9.8)     (3.6)      (13.4)
----------------------------------------------------------------------------
    Total                         $2,595.9   $(2,553.7)   $(20.1)     $ 22.1
============================================================================
1996:
  Multifoods Distribution Group   $1,691.6   $(1,673.5)   $ (9.4)     $  8.7
  North America Foods                459.7      (438.9)        -        20.8
  Venezuela Foods                    328.5      (309.4)        -        19.1
  Divested Businesses                 43.4       (36.7)      9.9        16.6
  Corporate Expenses                     -        (8.9)     (6.2)      (15.1)
----------------------------------------------------------------------------
    Total                         $2,523.2   $(2,467.4)   $ (5.7)     $ 50.1
============================================================================
</TABLE>

<TABLE>
<CAPTION>
                                  1998                                      1997                                 1996
                    ----------------------------------   ----------------------------------   ----------------------------------
                                  Depreciation                        Depreciation                         Depreciation        
                      Capital          and                  Capital       and                    Capital       and             
 (in millions)      Expenditures  Amortization  Assets   Expenditures  Amortization  Assets   Expenditures  Amortization  Assets
--------------------------------------------------------------------------------------------------------------------------------
<S>                    <C>            <C>       <C>         <C>            <C>       <C>         <C>            <C>       <C>
 Multifoods   
   Distribution
   Group               $ 5.4          $12.6     $341.4      $ 7.2          $12.9     $372.9      $13.9          $13.2     $392.5
 North America Foods     6.5           11.0      217.2       14.0           10.7      234.7       12.0           10.0      241.8
 Venezuela Foods         7.5            6.7      205.2        5.8            6.7      191.8        5.0            5.2      125.8
 Divested Businesses       -              -       18.9         .1              -       64.5         .1             .9       23.4
 Corporate               6.7             .4       44.7         .4             .4       51.4         .2             .5       38.8
--------------------------------------------------------------------------------------------------------------------------------
    Total              $26.1          $30.7     $827.4      $27.5          $30.7     $915.3      $31.2          $29.8     $822.3
================================================================================================================================
</TABLE>

Amounts expended for business acquisitions are not considered as part of 
capital expenditures.  Assets are identifiable to business segments 
either by their direct use or by allocations when used jointly by two or 
more segments.
<TABLE>
<CAPTION>
Note 18:   Quarterly Summary (unaudited)

                                                                     Operating
                                       Net     Operating   Unusual   Earnings
(in millions)                         Sales      Costs      Items     (Loss)
------------------------------------------------------------------------------
<S>                                  <C>        <C>        <C>        <C>
First Quarter - 1998
  Multifoods Distribution Group      $446.7     $(443.2)   $    -     $  3.5
  North America Foods                 115.5      (112.5)        -        3.0
  Venezuela Foods                     102.3       (99.5)        -        2.8
  Divested Business                     2.7        (2.1)        -         .6
  Corporate Expenses                      -        (2.4)        -       (2.4)
-----------------------------------------------------------------------------
    Total                            $667.2     $(659.7)   $    -     $  7.5
=============================================================================
First Quarter - 1997
  Multifoods Distribution Group      $425.3     $(421.9)   $    -     $  3.4
  North America Foods                 111.6      (109.5)        -        2.1
  Venezuela Foods                      71.2       (69.1)        -        2.1
  Divested Business                    18.0       (16.3)        -        1.7
  Corporate Expenses                      -        (2.7)     (3.6)      (6.3)
-----------------------------------------------------------------------------
    Total                            $626.1     $(619.5)   $ (3.6)    $  3.0
=============================================================================
Second Quarter - 1998
  Multifoods Distribution Group      $422.2     $(417.1)   $    -     $  5.1
  North America Foods                 116.7      (111.4)        -        5.3
  Venezuela Foods                      87.6       (89.0)        -       (1.4)
  Divested Business                     2.7         (.6)        -        2.1 
  Corporate Expenses                      -        (1.8)        -       (1.8)
-----------------------------------------------------------------------------
    Total                            $629.2     $(619.9)   $    -     $  9.3
=============================================================================
Second Quarter - 1997
  Multifoods Distribution Group      $424.6     $(425.3)   $    -     $  (.7)
  North America Foods                 114.4      (110.8)        -        3.6
  Venezuela Foods                      87.4       (78.5)        -        8.9
  Divested Business                     8.1        (7.0)        -        1.1
  Corporate Expenses                      -        (2.6)        -       (2.6)
-----------------------------------------------------------------------------
    Total                            $634.5     $(624.2)   $    -     $ 10.3
=============================================================================
Third Quarter - 1998
  Multifoods Distribution Group      $456.8     $(449.0)   $    -     $  7.8
  North America Foods                 133.4      (119.4)        -       14.0
  Venezuela Foods                      83.2       (86.0)        -       (2.8)
  Divested Business                     3.4        (2.1)        -        1.3 
  Corporate Expenses                      -        (2.2)        -       (2.2)
-----------------------------------------------------------------------------
    Total                            $676.8     $(658.7)   $    -     $ 18.1
=============================================================================
Third Quarter - 1997
  Multifoods Distribution Group      $452.6     $(450.9)   $    -     $  1.7
  North America Foods                 139.7      (130.4)        -        9.3
  Venezuela Foods                      95.9       (90.6)        -        5.3
  Divested Business                     8.9        (6.0)        -        2.9 
  Corporate Expenses                      -        (2.3)        -       (2.3)
-----------------------------------------------------------------------------
    Total                            $697.1     $(680.2)   $    -     $ 16.9 
=============================================================================
Fourth Quarter - 1998
  Multifoods Distribution Group      $444.5     $(437.2)   $    -     $  7.3 
  North America Foods                 106.1       (97.8)        -        8.3
  Venezuela Foods                      87.6       (86.4)        -        1.2
  Divested Business                      .4           -      (5.0)      (4.6)
  Corporate Expenses                      -        (2.3)        -       (2.3)
-----------------------------------------------------------------------------
    Total                            $638.6     $(623.7)   $ (5.0)    $  9.9 
=============================================================================
Fourth Quarter - 1997
  Multifoods Distribution Group      $427.4     $(426.9)   $ (5.1)    $ (4.6)
  North America Foods                 111.0      (105.2)    (11.4)      (5.6)
  Venezuela Foods                      92.3       (90.0)        -        2.3
  Divested Business                     7.5        (5.5)        -        2.0
  Corporate Expenses                      -        (2.2)        -       (2.2)
-----------------------------------------------------------------------------
    Total                            $638.2     $(629.8)   $(16.5)    $ (8.1)
=============================================================================
</TABLE>

<TABLE>
<CAPTION>
Note 18:   Quarterly Summary  (unaudited) (continued)

                            First Quarter       Second Quarter       Third Quarter       Fourth Quarter        Total Year
(in millions,               -------------       --------------       -------------       --------------      --------------
except per share data)      1998      1997       1998      1997      1998      1997      1998      1997      1998      1997
---------------------------------------------------------------------------------------------------------------------------
<S>                        <C>       <C>        <C>       <C>       <C>       <C>       <C>       <C>      <C>       <C>
Gross profit               $52.8     $48.9      $48.4     $53.2     $58.4     $61.2     $50.7     $49.4    $210.3    $212.7

Net earnings (loss)          2.0       (.4)(b)    4.5       4.0       9.4       8.6       4.1(c)   (9.4)(d)  20.0       2.8

Earnings (loss) per 
  share of common stock (a):
    Basic                    .11      (.02)(b)    .25       .22       .51       .48       .22(c)   (.53)(d)  1.09       .15
    Diluted                  .11      (.02)(b)    .25       .22       .50       .48       .21(c)   (.53)(d)  1.08       .15

Dividends paid per share
 of common stock             .20       .20        .20       .20       .20       .20       .20       .20       .80       .80

Market price of
  common stock:
   Close                  28 1/4     19 7/8     26 7/8    16 5/8    26 7/8    15 3/4   27 15/16  21 1/8    27 15/16  21 1/8
   High                   28 1/4     21 3/8     29 3/8    20 3/8    32 7/16   17 1/2   29 1/4    22        32 7/16   22 
   Low                    20         18 1/4     24 1/2    16 1/4    26 3/16   15 1/8   24 5/8    15 5/8    20        15 1/8
---------------------------------------------------------------------------------------------------------------------------
<FN>

(a) Earnings (loss) per share are computed independently for each period
    presented.  As a result of the effect of common shares issued from
    the exercise of employee stock options, the total of diluted per 
    share results for the four quarters does not equal annual diluted
    earnings per share in fiscal 1998.

(b) Includes a net after-tax charge of $2.2 million, or 12 cents per 
    share, from unusual items.

(c) Includes a net after-tax charge of $3.2 million, or 17 cents per 
    share, from unusual items.  Also includes a net after-tax gain of 
    $1.8 million, or 10 cents per share, from the elimination of 
    subsidized retire medical coverage for most active employees in the 
    United States.

(d) Includes a net after-tax charge of $12.6 million, or 71 cents per 
    share, from unusual items.
</FN>
</TABLE>


<TABLE>
<CAPTION>
Six-Year Comparative Summary

Fiscal year ended the last day of February
(dollars and shares in millions, except per share data)   1998         1997         1996         1995         1994         1993
--------------------------------------------------------------------------------------------------------------------------------
<S>                                                   <C>          <C>          <C>          <C>          <C>          <C>
Consolidated Summary of Operations
Net sales                                             $2,611.8     $2,595.9     $2,523.2     $2,295.1     $2,158.4     $2,199.2
Cost of materials and production                      (2,237.6)    (2,215.4)    (2,135.7)    (1,901.9)    (1,743.9)    (1,783.4)
Delivery and distribution                               (163.9)      (167.8)      (162.9)      (146.2)      (141.8)      (141.7)
Selling, general and administrative                     (160.5)      (170.5)      (168.8)      (186.7)      (204.9)      (199.0)
Unusual items                                             (5.0)       (20.1)        (5.7)        26.2        (70.0)           -
Interest, net                                            (12.4)       (16.8)       (17.9)       (11.4)       (10.1)       (10.9)
Other income (expense), net                                  -          (.3)        (4.4)        (3.4)         (.4)          .1
Earnings (losses) from unconsolidated affiliates             -            -            -            -        (12.2)         1.8
--------------------------------------------------------------------------------------------------------------------------------
Earnings (loss) before income taxes                       32.4          5.0         27.8         71.7        (24.9)        66.1
Income taxes                                             (12.4)        (2.2)        (3.7)       (14.7)        11.5        (24.9)
--------------------------------------------------------------------------------------------------------------------------------
Net earnings (loss)                                   $   20.0     $    2.8     $   24.1     $   57.0     $  (13.4)    $   41.2
================================================================================================================================
Earnings (loss) per share of common stock:
  Basic                                               $   1.09     $    .15     $   1.33     $   3.16     $   (.72)    $   2.13
  Diluted                                                 1.08          .15         1.32         3.16         (.72)        2.10
--------------------------------------------------------------------------------------------------------------------------------
Year-End Financial Position
Current assets                                        $  484.4     $  563.3     $  459.0     $  471.7     $  439.3     $  415.9
Current liabilities                                      312.4        372.0        272.3        316.0        301.7        243.5
Working capital (excluding cash and short-term debt)     187.7        277.5        218.8        203.1        189.7        187.9
Property, plant and equipment, net                       220.6        225.4        226.5        228.0        245.9        245.7
Long-term debt                                           162.9        202.3        202.9        183.1        195.1        167.0
Shareholders' equity                                     309.4        289.6        299.6        291.1        250.0        322.0
Total assets                                             827.4        915.3        822.3        846.7        814.8        803.5
--------------------------------------------------------------------------------------------------------------------------------
Dividends Paid
Preferred stock                                       $      -     $      -     $     .1     $     .2     $     .2     $     .2
Common stock                                              14.7         14.5         14.4         14.4         15.2         15.4
Per share of common stock                                  .80          .80          .80          .80          .80          .80
--------------------------------------------------------------------------------------------------------------------------------
Other Financial Data
Current ratio                                            1.6:1        1.5:1        1.7:1        1.5:1        1.5:1        1.7:1
Equity per share of common stock                      $  16.51     $  16.08     $  16.66     $  16.16     $  13.63     $  16.64
Debt to total capitalization                               38%          51%          45%          45%          50%          37%
Depreciation                                          $   27.0     $   26.6     $   25.3     $   22.8     $   24.9     $   23.8
Capital expenditures, excluding acquisitions          $   26.1     $   27.5     $   31.2     $   30.8     $   51.9     $   45.7
Average common shares outstanding:
  Basic                                                   18.4         18.0         18.0         18.0         18.9         19.3
  Diluted                                                 18.6         18.0         18.0         18.0         18.9         19.5
Number of common shareholders                            4,705        5,087        4,930        5,234        4,939        5,097
Number of employees                                      6,807        7,176        7,115        7,495        8,390        8,341
Market price per share of common stock: 
  Close                                             $ 27 15/16     $ 21 1/8     $ 18 5/8     $ 18 5/8     $ 17 3/8     $ 25 3/4
  High                                              $ 32  7/16     $ 22         $ 23 7/8     $ 19 5/8     $ 26 3/8     $ 28 7/8
  Low                                               $ 20           $ 15 1/8     $ 17 1/4     $ 15 1/8     $ 16 3/4     $ 23 1/4
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>