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

                                      FORM 10-K


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

                    For the fiscal year ended:   October 3, 1997
                                                     
                                          OR

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

                    For the transition period from           to
              
                          Commission file number:  001-13403

                            American Italian Pasta Company
                ------------------------------------------------------
                (Exact name of Registrant as specified in its charter)


                          Delaware                        84-1032638
                ------------------------------        -------------------
                State or other jurisdiction of        (I.R.S. Employer
                incorporation or organization         Identification No.)


              1000 Italian Way, Excelsior Springs, Missouri       64024 
              ----------------------------------------------------------
                 (Address of principal executive office and Zip Code)


          Registrant's telephone  number, including  area code:  (816) 502-
          6000
           
          Securities registered pursuant to Section 12(b) of the Act:


                                             Name of each exchange
          Title of each class                on which registered
          -------------------                ---------------------
          Class A Convertible                New York Stock Exchange
          Common Stock:  $.001 par
          value per share                   

          Securities registered pursuant to section 12(g) of the Act:  None 

               Indicate by check mark whether  the Registrant has filed all
          documents and reports required to be filed by Section 13 or 15(d)
          of the  Securities Exchange Act  of 1934 during the  preceding 12
          months  (or  for such  shorter  period  that  the Registrant  was
          required to file such reports), and (2) has been subject  to such
          filing requirements for the past 90 days. Yes [ ] No [X]

               Indicate  by check mark  if disclosure of  delinquent filers
          pursuant to Item  405 of Regulation S-K is  not contained herein,
          and will not be contained  to the best of Registrant's knowledge,
          in  definitive proxy  or  information statements  incorporated by
          reference in Part  III of this Form 10-K or any amendment to this
          Form 10-K. [X]

               As of  December 12, 1997  the aggregate market value  of the
          Registrant's  Class A  Convertible  Common  Stock  held  by  non-
          affiliates  (using the New  York Stock Exchange's  closing price)
          was approximately $257,916,880.  

               The number of shares outstanding  as of December 12, 1997 of
          the  Registrant's Class A Convertible Common Stock was 16,776,061
          and there were no shares outstanding of the Class B Common Stock.

                         DOCUMENTS INCORPORATED BY REFERENCE

               Portions  of the Registrant's Definitive Proxy Statement for
          the  1998  Annual  Meeting of  Stockholders  are  incorporated by
          reference  into  Part III  of this  Report. The  Definitive Proxy
          Statement will be  filed no later than 120 days  after October 3,
          1997. 
           
          <PAGE> 

          Introduction and Certain Cautionary Statements
          ----------------------------------------------

               American  Italian Pasta  Company  ("AIPC" or  the "Company")
          changed its  fiscal year end from December  31 to the last Friday
          of September or  the first Friday of  October effective beginning
          with  the nine-month fiscal  period ended September  27, 1996 and
          for all subsequent periods. This change resulted in a  nine-month
          fiscal period for 1996, and will result  in a 53-week fiscal year
          for 1997,  and a 52-  or 53-week year  for all  subsequent fiscal
          years.  The  Company's first  three  fiscal quarters  end  on the
          Friday last preceding December 31,  March 31, and June 30  or the
          first Friday of the following month of each quarter. For purposes
          of this  Annual Report on  Form 10-K (this "Annual  Report"), the
          1996 fiscal  year is  described as  the nine-month  fiscal period
          ended September  30, 1996 and  the 1997 fiscal year  is described
          has having ended on September 30, 1997.

               The discussion set forth below, as well as other portions of
          this  Annual  Report,  contains  statements concerning  potential
          future  events.  Such  forward-looking statements are  based upon
          assumptions by the  Company's management, as of the  date of this
          Annual   Report,   including   assumptions    about   risks   and
          uncertainties faced by  the Company.  Readers  can identify these
          forward-looking statements by their use of such verbs as expects,
          anticipates,  believes or similar  verbs or conjugations  of such
          verbs.   If  any of  management's assumptions prove  incorrect or
          should  unanticipated circumstances  arise, the  Company's actual
          results  could materially differ  from those anticipated  by such
          forward-looking statements.  The differences could be caused by a
          number  of factors or  combination of factors  including, but not
          limited to,  those factors  identified in  the Company's  Current
          Report  on Form  8-K  dated  October 29,  1997,  which is  hereby
          incorporated by reference.   This report has been  filed with the
          Securities   and   Exchange   Commission   (the  "SEC"   or   the
          "Commission")   in  Washington,  D.C.  and  can  be  obtained  by
          contacting  the SEC's public reference operations or obtaining it
          through  the   SEC's  web   site  on  the   World  Wide   Web  at
          http://www.sec.gov.  Readers are strongly encouraged to  consider
          those factors when evaluating any such forward-looking statement.
          The Company  will not  update any  forward-looking statements  in
          this Annual Report to reflect future events or developments.

               The  Company  holds  a number  of  federally  registered and
          common  law trademarks,  which are  used  throughout this  Annual
          Report. The Company  has registered the following  marks with the
          U.S. Patent  and Trademark  Office: AIPC  American Italian  Pasta
          Company,  Pasta LaBella,  and Montalcino.  The  Company also  has
          pending trademark applications with the U.S. Patent and Trademark
          Office for the following marks: Calabria and Heartland.

               Additionally,  a number  of federally  registered trademarks
          are used throughout this Annual Report that  are not owned by the
          Company.   Mueller's   is   a   registered   trademark   of   CPC 
          International,  Inc.  ("CPC").  San   Giorgio  and  Ronzoni   are
          registered trademarks of  Hershey Foods Corporation  ("Hershey").
          Prince  and Creamette are  registered trademarks of  Borden Foods
          Holdings Corporation ("Borden").

          <PAGE> 

                                        PART I

          ITEM 1.   BUSINESS.

          General
          -------

               American Italian  Pasta Company is the third largest and one
          of the fastest-growing producers and  marketers of pasta in North
          America. The Company commenced operations in  1988 with the North
          American  introduction  of  new,  highly-efficient  durum   wheat
          milling and pasta production technology. Management believes that
          the  Company's  singular  focus  on pasta,  vertically-integrated
          facilities, continued technological  improvements and development
          of a highly-skilled workforce enable AIPC to produce high-quality
          pasta at costs below those of many of its competitors. Management
          believes  that the combination  of the Company's  cost structure,
          the   average  age  of  its  competitors'  North  American  pasta
          production equipment and  the growing pasta consumption  in North
          America creates  significant opportunities for  continued growth.
          The  Company's  revenue  and operating  income  excluding product
          introduction  costs  were  $121.6  million  and   $16.7  million,
          respectively, for the calendar year  ended December 31, 1996, and
          grew at  compounded annual growth  rates (CAGRs) of 33%  and 33%,
          respectively,  over the five-year period ended December 31, 1996.
          During the fiscal year ended  September 30, 1997, the Company had
          revenue  of  $129.1  million and  an  operating  margin excluding
          product introduction costs of 16.3%.

               The Company  produces more than  80 dry pasta shapes  in two
          vertically-integrated  production  and  distribution  facilities,
          strategically  located   in  Excelsior   Springs,  Missouri   and
          Columbia,  South Carolina. The construction of the Missouri plant
          in  1988  represented  the  first  use  in  North  America  of  a
          vertically-integrated,  high-capacity pasta  plant using  Italian
          pasta production technology. Management believes that  this plant
          continues to  be among  the most  efficient and  highly-automated
          pasta  facilities in  North America.  The  South Carolina  plant,
          which  commenced operations in  1995, produces only  pasta shapes
          conducive to high-volume production and employs a highly-skilled,
          self-managed  work  force.  Management  believes that  the  South
          Carolina plant  is  the most  efficient pasta  facility in  North
          America in  terms of productivity and conversion  cost per pound.
          To meet  the significant volume requirements of the CPC Agreement
          and  support future  growth,  the  Company  commenced  a  capital
          expenditure program in 1997 to nearly double the Company's annual
          pasta  production capacity and add a highly-automated durum wheat
          mill to its  South Carolina plant, with completion  scheduled for
          fiscal 1998.

               The Company was incorporated under  the laws of the State of
          Delaware in 1991,  and is the successor  by merger of a  Colorado
          corporation  incorporated  in  1986.    The  Company's  executive 
          offices  are  located  at 1000  Italian  Way,  Excelsior Springs,
          Missouri  64204, and its  telephone number is  (816)502-6000. The
          Company s  home  page  on  the  World  Wide  Web  is  located  at
          http://www.pastablabella.com.   Information   contained   in  the
          Company's home page  shall not  be deemed  to be a  part of  this
          Annual Report.

          Recent Developments
          -------------------

               AIPC  has commenced  an  $86.0 million  capital  expenditure
          program  to increase  its current  pasta  production capacity  by
          approximately 90% from  over 300 million pounds per  year to over
          600 million pounds  per year in 1998. The  additional capacity at
          the Missouri  facility will combine high-speed, high-output pasta
          production  lines with  the ability  to produce  a wide  range of
          products, and will  include a distribution center  expansion. The
          capital  expenditures program also includes the construction of a
          durum wheat  mill in  South Carolina  which adjoins  the existing
          plant facility, an  over 180%  increase in  the facility's  pasta
          production capacity, and a doubling  of the capacity of the South
          Carolina distribution facility. 

               The  additional capacity will  be used to  produce Mueller's
          brand pasta and take advantage of other  market opportunities. By
          the second quarter of fiscal 1998, AIPC will assume production of
          substantially  all  of CPC's  Mueller's  pasta, which  management
          estimates will require a production capacity of approximately 200
          million  pounds a year. CPC's guaranteed annual minimum purchases
          of 175 million pounds pursuant  to the CPC Agreement will utilize
          approximately 60% of the Company's newly-added capacity.

               On November 18, 1997, the Company announced the signing of a
          letter  of   intent  with   Harvest  States   for  the   possible
          construction and operation of a pasta production and distribution
          facility adjacent to Harvest State's mill in  Kenosha, Wisconsin.
          The  finalization  of the  project  is  subject  to a  number  of
          significant conditions,  including the execution of  a definitive
          agreement with Harvest States.

          Products and Brands
          -------------------

               AIPC's  product  line, comprising  over  1,000 stock-keeping
          units  ("SKUs"), includes long goods such as spaghetti, linguine,
          fettuccine, angel hair and lasagna, and short goods such as elbow
          macaroni, mostaccioli, rigatoni, rotini, ziti and egg noodles. In
          many  instances, the  Company produces  pasta  to its  customers'
          specifications.  AIPC makes over 80 different shapes and sizes of
          pasta products in over 160 package configurations, including bulk
          packages     for     institutional    customers     and     small
          individually-wrapped   packages   for  retail   consumers.   AIPC
          contracts  with third  parties  for  the  production  of  certain
          specialized pasta shapes,  such as retail lasagna  and canneloni, 
          which  are necessary  to offer  customers a  full range  of pasta
          products.  Purchased pasta  represented less  than  2% of  AIPC's
          total unit volume in fiscal periods 1997, 1996 and 1995.

               The  Company  believes  that  its state-of-the-art,  Italian
          pasta  production equipment is  capable of producing  the highest
          quality  pasta. AIPC's  products  are  produced  to  satisfy  the
          specifications of  the Company's  customers  as well  as its  own
          product  specifications, which management  believes are among the
          highest in the industry. The  Company's pasta is distinguished by
          a rich, natural "wheaty" taste and a consistently smooth and firm
          ("al dente") texture with a minimum amount of white spots or dark
          specks. AIPC evaluates  the quality of its products  through: (i)
          internal laboratory  evaluation against  competitive products  on
          physical characteristics, including color, speck count, shape and
          consistency, and  cooking performance, including  starch release,
          protein  content  and  texture;   and  (ii)  competitive  product
          comparisons that AIPC's customers perform on a regular basis.

               The Company submits its production facilities to semi-annual
          inspections  by the  American Institute  of  Baking ("AIB"),  the
          leading  United  States  baking,   food  processing  and   allied
          industries  evaluation agency for sanitation and food safety. The
          Company consistently  has achieved  the AIB's  highest "Superior"
          rating.  The  Company  also  implemented  a  comprehensive Hazard
          Analysis  Critical Control Point ("HAACP") program five years ago
          to  continuously  monitor  and improve  the  safety,  quality and
          cost-effectiveness of the Company's facilities  and products. The
          Company  believes  that having  an AIB  rating of  "Superior" and
          meeting  HAACP  standards  have helped  the  Company  attract new
          business and strengthen existing customer relationships.

               In  fiscal  1995, AIPC  introduced  a  product line  of  all
          natural, full-flavored  pasta marketed  under  the Pasta  LaBella
          brand. Pasta LaBella flavored pasta is principally marketed as  a
          branded  product  to  grocery  retailers  and  to  Sysco.  AIPC's
          all-natural, full-flavored dry pasta is available in a variety of
          flavors  including tomato  basil,  lemon  pepper, pesto,  roasted
          garlic  and herb, roasted bell pepper/roasted garlic, and cracked
          black pepper.  Management believes  that AIPC's  use of  patented
          flavoring  ingredients   under  an   exclusive   license  and   a
          proprietary manufacturing process  allows the Company to  provide
          superior  product  quality  and   flavor  delivery  compared   to
          competitive flavored pasta products. Pasta LaBella flavored pasta
          was recognized as  one of the top  10 new products in  the United
          States in 1996 by Food  Processing Magazine. AIPC also intends to
          continue  assisting its  customers with  innovative products  and
          packaging, and the development of additional value-added products
          intended  to  generate  higher  margins  than  traditional  pasta
          products.

          Marketing and Distribution
          -------------------------- 

               AIPC actively  markets its products through approximately 15
          internal  sales  and  marketing  personnel  and approximately  30
          independent food  brokers and distributors throughout  the United
          States.  AIPC's senior  management is  directly  involved in  the
          selling process in  all customer markets. The Company's sales and
          marketing strategy  is  to  provide  superior  quality,  complete
          product offering, distinctive  packaging specifically tailored to
          customers'  needs,  competitive  pricing  and  superior  customer
          service to  attract new  customers and  grow existing  customers'
          pasta sales.  The Company  has established  a significant  market
          presence  in  North  America  by  developing  strategic  customer
          relationships with  food industry  leaders that  have substantial
          pasta  requirements. The Company has a long-term supply agreement
          with Sysco Corporation  ("Sysco"), the nation's largest  marketer
          and  distributor of  food service  products. In  1998, AIPC  will
          become the  exclusive producer  of Mueller's,  the largest  pasta
          brand  in the  United  States,  pursuant  to a  recent  long-term
          manufacturing  and  distribution  agreement  with  CPC.  CPC  has
          announced its  intention to  close its  current pasta  production
          facility in December  1997. AIPC is also the  primary supplier of
          pasta to  Sam's Wholesale Club  ("Sam's Club"), the  largest club
          store chain in the United  States, and supplies private label and
          branded pasta to six of  the 10 largest grocery retailers  in the
          United  States,  including  Wal-Mart,  A&P,  Publix,  Albertsons,
          American Stores and  Winn-Dixie. In addition, AIPC  has developed
          supply  relationships  with  leading  food  processors,  such  as
          Pillsbury, General Mills and Kraft Foods, which use the Company's
          pasta as an ingredient in branded food products.

               One of the Company's core strengths has been the development
          of  strong  customer  relationships and  the  establishment  of a
          reputation as a technical and  service expert in the pasta field.
          As part of  its overall customer service strategy,  AIPC uses its
          category management expertise to assist customers in their supply
          management  decisions  regarding  pasta  and  new  products.  The
          Company's  category  management  experts  use  on-line  Nielsen's
          supermarket data to recommend pricing, SKU sets and shelf spacing
          to both private label and branded customers. AIPC representatives
          also  assist food processors in incorporating  AIPC's pasta as an
          ingredient  in its customers' food products. The Company sponsors
          an annual  "Pasta  Technology  Forum" which  is  a  training  and
          development program for its customers' production and new product
          personnel.  AIPC   also  produces  and  distributes  a  quarterly
          newsletter, the  Pasta  Advisor, to  its institutional  customers
          which  contains  recommendations  regarding  storage,  conveying,
          cooking  and ingredient  combination.  In addition  to  technical
          education, the  Company provides  dedicated technical  support to
          its institutional  customers by making  recommendations regarding
          the processing of  pasta in their facilities. AIPC  believes that
          these  value-added  activities  provide customers  with  a better
          appreciation and awareness of the Company and its products. 

               The  Company  consistently  demonstrates  its commitment  to
          customer  service through  the development  of enhanced  customer 
          service programs. Examples of these programs include the creation
          by AIPC of  an Efficient  Customer Response  ("ECR") model  which
          uses Electronic Data Interchange ("EDI") and vendor replenishment
          programs  to  assist  its  key  retail  customers,  and  category
          management  services for its private label and branded customers.
          These  programs  also  enable  the  Company  to  more  accurately
          forecast production and sales demand, enabling higher utilization
          of production  capacities and lower average unit  costs. AIPC has
          also  created a  dedicated  sales force  for  Sysco, its  largest
          customer, to provide regional sales support.

               The Company's  three distribution centers  are strategically
          located  in South Carolina,  Missouri and Southern  California to
          serve  the  national  market.  The warehousing  and  distribution
          facilities   are  integrated   with   the  Company's   production
          facilities  which   allows   cased,  finished   products  to   be
          automatically conveyed  via enclosed case conveying  systems from
          the  production  facilities  to  the  distribution  centers   for
          automated   palletization  and   storage   until  shipping.   The
          combination of  integrated facilities  and multiple  distribution
          centers  enables  AIPC to  realize significant  distribution cost
          savings  and  provides   lead  time,  fill  rate   and  inventory
          management  advantages to  its customers.  The  operation of  the
          Missouri and  South Carolina  distribution centers  is outsourced
          under  a  long-term   agreement  with  Lanter  Company,   a  firm
          specializing in warehouse and logistics management services.

               Most  of  the Company's  customers use  inventory management
          systems  which  track sales  of particular  products and  rely on
          reorders being  rapidly filled  by suppliers.  The Company  works
          with its customers  to forecast consumer demand which  allows the
          Company to anticipate customer demand.

          Pasta Production
          ----------------

               Pasta's  primary ingredient is  semolina, which is extracted
          from durum wheat  through a milling process. Durum  wheat is used
          exclusively for  pasta. Durum wheat  used in United  States pasta
          production  generally  originates   from  Canada,  North  Dakota,
          Montana, Arizona and  California. Each variety of durum wheat has
          its own unique set of protein, gluten content, moisture, density,
          color  and other attributes  which affect  the quality  and other
          characteristics of the semolina. The Company blends semolina from
          different   wheat   varieties   as  needed   to   meet   customer
          specifications.

               Although  durum wheat can be purchased directly from farmers
          or  grower-owned cooperatives,  most  milling companies  purchase
          durum wheat on  a commodity exchange.  AIPC's ability to  produce
          high-quality pasta  generally  begins with  its purchasing  durum
          wheat  directly from  farmers  and  grower-owned cooperatives  in
          North Dakota Pasta  Company, a farmer-owned cooperative  in North
          Dakota  ("Dakota  Growers"),  Montana,  Arizona  and  California, 
          rather  than from grain exchanges. This purchasing method ensures
          that the  extracted  semolina meets  AIPC's  specifications.  The
          Company has several sources for  durum wheat and is not dependent
          on  any one supplier  or sourcing area. As  a result, the Company
          believes that it has adequate  sources of supply for durum wheat.
          The Company occasionally  buys and sells semolina  to balance its
          milling  and production requirements. AIPC and Dakota Growers are
          the  only major  producers of  pasta  in North  America that  own
          vertically integrated milling and production facilities.

               Durum  wheat  is a  cash crop  whose average  monthly market
          price has fluctuated from a low of  $5.18 per bushel to a high of
          $7.49 per bushel in  the last four years.  Between June 30,  1997
          and December 1,  1997, the market price of  durum wheat increased
          by approximately 15%  from $5.60 per bushel to  $6.45 per bushel.
          Durum  wheat does  not have  a  related futures  market to  hedge
          against  such price fluctuations.  The Company manages  its durum
          wheat   cost  risk   through   long-term  contracts   and   other
          arrangements with  its customers  and advance  purchase contracts
          for  durum  wheat which  are generally  less than  twelve months'
          duration.  Long-term   supply  agreements   and  other   customer
          arrangements which allow for the pass-through of durum wheat cost
          changes in certain circumstances represented approximately 60% of
          AIPC's  total revenue  for the  fiscal year  ended September  30,
          1997.  Management believes  that  the Company  will significantly
          increase  the percentage of revenues which are generated pursuant
          to  contracts which  include provisions  for  durum cost  related
          sales price adjustments as its  contract with CPC includes such a
          price adjustment provision. 

               Durum  wheat is shipped to the Company's production facility
          in Missouri directly  from North Dakota, Montana and Canada under
          a long-term rail contract with its most significant rail carrier,
          the  Canadian  Pacific  Rail System.  Under  such  agreement, the
          Company is obligated to transport specified wheat volumes and, in
          the event  such volumes are  not met, the Company  must reimburse
          the carrier for certain of its costs. The Company currently is in
          compliance with  such volume  obligations. The  Company also  has
          rail  contracts to  ship  semolina, milled  and processed  at the
          Missouri facility, and  durum wheat, pending construction  of the
          Columbia durum mill in 1998 to the South Carolina facility.

               The durum  wheat  delivered to  AIPC's mill  in Missouri  is
          first  unloaded,  blended  and  pre-cleaned.  Next, the  moisture
          content of  the wheat is raised to the optimal level required for
          milling (the "tempering process"). The cleaned and tempered wheat
          is  then  conveyed  to  the  mill where  grinding,  sifting,  and
          purifying processes  extract the  purest  possible semolina.  The
          semolina  milling is  controlled  from  a  central  control  room
          located  in the mill where a single AIPC team member monitors and
          directs  the mill's entire milling, cleaning and storage process.
          Semolina  is  then  pneumatically distributed  from  the  mill to
          AIPC's pasta production facility in Missouri and, through the use
          of a leased fleet of  33 dedicated railcars, transferred to South 
          Carolina.

               After being mixed with water, the semolina is  extruded into
          the  desired  shapes   and  travels  through  computer-controlled
          high-temperature dryers  and stabilized at room  temperature. The
          Company's  entire  pasta  production  process  is  controlled  by
          programmable logic controllers which enable all of the production
          lines to be operated and monitored by minimal staff. The pasta is
          then packaged  in a wide  variety of packaging  configurations on
          highly-automated  film, carton  and  bulk  packaging systems  and
          forwarded through automated conveyors to the distribution  center
          to be palletized and stored prior to shipment.

               AIPC   purchases    its   packaging    supplies,   including
          poly-cellophane, paperboard cartons, boxes  and totes from  third
          parties.  Management believes the Company has adequate sources of
          packaging supplies.

               The  Company buys  materials  in  quantities  based  on  the
          anticipated future demands of its customers.

          Trademarks and Patents
          ----------------------

               The  Company  holds  a number  of  federally  registered and
          common law trademarks  which it considers  to be of  considerable
          value and  importance to  its business  including: AIPC  American
          Italian Pasta Company,  American Italian, and Pasta  LaBella. The
          Company has registered  the AIPC American Italian  Pasta Company,
          Pasta  LaBella, Montalcino  and other  trademarks  with the  U.S.
          Patent  and Trademark  Office.  AIPC  has  filed  a  registration
          application with  the U.S.  Patent and  Trademark Office for  the
          Calabria  and  Heartland  trademarks.  A  patent  application  is
          currently pending  with  respect  to  the  proprietary  flavoring
          process for Pasta LaBella flavored pasta.

          Dependence on Major Customers
          -----------------------------

               Historically, a  limited number of customers  have accounted
          for a substantial portion of the Company's revenues. During 1995,
          the nine-month  fiscal period ended  September 30, 1996,  and the
          fiscal  year  ended  September  30,  1997,  Sysco  accounted  for
          approximately 33%, 27% and 27%, respectively, and sales to  Sam's
          Club  accounted for approximately 23%, 19% and 22%, respectively,
          of the Company's  revenues. The Company expects  it will continue
          to rely on a limited number  of major customers for a substantial
          portion of its revenues in the future. Management believes that a
          majority  of the Company's  fiscal 1998 revenues  will be derived
          from combined sales to Sysco, Sam's Club and CPC. The Company has
          an exclusive supply  contract with Sysco (the  "Sysco Agreement")
          through June 2000, subject to renewal by Sysco for two additional
          three-year periods. The Company recently entered into a long-term
          manufacturing  and  distribution  agreement with  CPC  (the  "CPC 
          Agreement")  that  requires CPC  to  purchase  a minimum  of  175
          million pounds of pasta annually for nine years. The Company does
          not have supply contracts with  a substantial number of its other
          customers,  including Sam's  Club.  Accordingly, the  Company  is
          dependent upon its other customers to sell the Company's products
          and to assist the Company  in promoting market acceptance of, and
          creating  demand for, the  Company's products. An  adverse change
          in,   or  termination  or  expiration  without  renewal  of,  the
          Company's relationships with or the financial viability of one or
          more of its major customers  could have a material adverse effect
          on the  Company's business,  financial condition  and results  of
          operations.

               In  addition,  certain exclusivity  provisions of  the Sysco
          Agreement  and  CPC  Agreement prevent  AIPC  from  producing and
          supplying  competitors  of  Sysco  and  CPC  with  certain  pasta
          products.  Under the Sysco  Agreement, the Company  is restricted
          from  supplying pasta products to certain food service businesses
          other than  Sysco without  Sysco's prior  consent. Under  the CPC
          Agreement, AIPC may not produce branded  retail pasta for Borden,
          Hershey or Barilla  Alimentare S.p.A.  ("Barilla") without  CPC's
          consent, and is  limited to the production of  an aggregate of 12
          million  pounds  of  branded pasta  products  annually  for other
          producers.

               Under   the  CPC  Agreement,  CPC  will  close  its  current
          facilities dedicated to  the production of Mueller's  brand pasta
          and, beginning in  1998, AIPC will become  the exclusive producer
          of Mueller's, with the exception of certain specialty items which
          are purchased from other suppliers. CPC is a global food company,
          and  its Mueller's  pasta line  is the  oldest and  largest pasta
          brand in the United States  with an annual sales volume averaging
          approximately  200 million  pounds over  the  last five  calendar
          years. AIPC  will be  paid on a  "cost plus"  basis in  an amount
          equal to total actual cost of production plus a guaranteed profit
          per pound  of pasta produced. CPC has guaranteed minimum purchase
          volumes of 175  million pounds annually for nine  years. AIPC may
          also benefit from additional cost savings resulting from improved
          productivity. The  term of the  contract is through  December 31,
          2006 with a three-year renewal term at the option of CPC. The CPC
          Agreement may be terminated by CPC upon certain events, including
          (i)  a failure  by  AIPC to  satisfy  certain minimum  production
          requirements for any reason other than the fault of CPC or events
          demonstrably beyond AIPC's  control, or (ii) AIPC's  merger with,
          or sale of substantially all of its assets to, Borden, Hershey or
          Barilla.

               Pursuant  to  the  Sysco  Agreement,  AIPC  is  the  primary
          supplier of pasta for Sysco and has the exclusive right to supply
          pasta to Sysco for sale under Sysco's name. Sysco, which operates
          from approximately  65  operations  and  distribution  facilities
          nationwide,  provides  products  and  services  to  approximately
          230,000  restaurants,  hotels,  schools,   hospitals,  and  other
          institutions, as well as the  U.S. government. For the year ended 
          September  30,   1997,  sales  attributed  to  Sysco  represented
          approximately 27% of  the Company's net revenues.  Sysco recently
          exercised  its option  to renew  its agreement  with AIPC  for an
          additional three years through June  30, 2000, and has options to
          renew the agreement for two additional three-year periods through
          June 30, 2006.  AIPC products  are sold to  Sysco on  a cost-plus
          basis, with annual adjustments based  on the prior year's  costs.
          Under the Sysco Agreement, AIPC  may not supply pasta products to
          any business  other than  Sysco in the  United States,  Mexico or
          Canada that operates as, or sells to, institutions and businesses
          which  provide  food for  consumption away  from home  (i.e. food
          service  businesses) without Sysco's  prior consent. In  1996 and
          1997, Sysco honored the  Company as one of  its top 10  suppliers
          out of its  over 1,300 supplier base. The Sysco  Agreement may be
          terminated  by Sysco upon certain events, including a substantial
          casualty to or condemnation of AIPC's Missouri plant.

          Competition
          -----------

               The  Company  operates in  a highly  competitive environment
          against numerous well-established  national, regional and foreign
          companies, and many smaller companies. The  Company's competitors
          include  both independent pasta producers and pasta divisions and
          subsidiaries  of  large  food  products  companies.  The  Company
          competes in the procurement of raw materials, the development  of
          new products  and product lines, the improvement and expansion of
          previously  introduced  products   and  product  lines  and   the
          production, marketing and  distribution of its products.  Some of
          these companies have longer operating histories,  broader product
          lines,  significantly  greater   brand  recognition  and  greater
          production  capacity and financial  and other resources  than the
          Company.  AIPC's products  compete  with a  broad  range of  food
          products,  both in the retail and institutional customer markets.
          Competition  in these  markets  generally  is  based  on  product
          quality  and taste, pricing,  packaging and customer  service and
          logistics  capabilities. The Company  believes that  it currently
          competes favorably with respect to these factors.

               The    Company's    direct   competitors    include    large
          multi-national companies  such as  food  industry leader  Hershey
          Foods  Corp. with  brands such  as San  Giorgio and  Ronzoni; and
          Borden Foods  Co. with brands  such as Prince and  Creamette; and
          regional U.S. producers of retail and institutional pasta such as
          Dakota  Growers, Philadelphia Macaroni  Co. Inc. and  A. Zerega's
          Sons, Inc., each  an independent producer, and  foreign companies
          such  as  Italian  pasta  producers  De Cecco  ("De  Cecco")  and
          Barilla.  The  Company also  competes,  indirectly, against  food
          processors such  as Kraft  Foods, General  Mills, Inc.,  American
          Home  Food   Products  Corporation,  Campbell  Soup  Company  and
          Stouffers Corp., that  produce pasta internally as  an ingredient
          for use in their food products.

               The   Company's  competitive   environment   depends  to   a 
          significant extent on the aggregate industry capacity relative to
          aggregate  demand  for  pasta  products.  Several domestic  pasta
          producers have  recently completed production  facility additions
          or  announced their  intention  to increase  domestic  production
          capacity.  In  addition  to  AIPC's  planned  capital  expansion,
          management  believes that these capacity additions represent more
          than 200 million  pounds of additional pasta  production capacity
          in aggregate.  Dakota Growers recently increased the capacity  of
          its durum wheat mill and has announced  plans to complete a pasta
          production capacity expansion in excess  of 100 million pounds by
          the end of 1997.  Hershey recently added approximately 50 million
          pounds of pasta capacity to its facility in Winchester, Virginia.
          In September 1997, Barilla announced plans to build a pasta plant
          near Ames,  Iowa  with  an estimated  annual  pasta  capacity  of
          approximately 150 million pounds.  Two major pasta producers have
          also  recently announced planned  reductions in  pasta production
          capacity.   Borden announced that  it will close  or sell five of
          its ten North American pasta plants  by the end of 1997, and  CPC
          intends  to eliminate its  capacity of approximately  180 million
          pounds by the end of 1997.  

               Several foreign  producers, based  principally in Italy  and
          Turkey,  have  aggressively  targeted the  U.S.  pasta  market in
          recent   years.  In   1996,  a   U.S.   Department  of   Commerce
          investigation revealed that several Italian and Turkish producers
          were engaging in unfair trade  practices by selling pasta at less
          than fair value in the U.S. markets and benefiting from subsidies
          from  their respective governments. Effective July 1996, the U.S.
          International Trade Commission ("ITC"),  imposed anti-dumping and
          countervailing  duties on Italian and Turkish imports. While such
          duties may  enable the  Company and its  domestic competitors  to
          compete more favorably  against Italian and Turkish  producers in
          the U.S. pasta market, there can be no assurance that the  duties
          will be maintained for any length of time, or that these or other
          foreign producers will not sell competing products in the  United
          States at  prices less than  those of the Company.  Bulk imported
          pasta,  and pasta  produced in  the  U.S. by  foreign firms,  are
          generally  not subject  to such  anti-dumping and  countervailing
          duties. Foreign pasta  producers generally may avoid  such duties
          by importing bulk pasta into the United States and repackaging it
          in  U.S. facilities for  distribution. A leading  branded Italian
          producer,   Barilla,   opened  a   bulk  pasta   repackaging  and
          distribution facility in Syracuse, New York in  1996 and recently
          announced plans to  build a pasta production plant  in Ames, Iowa
          for completion in mid-1998. In  addition, on August 28, 1997, the
          Department  of  Commerce  announced  that  it  is  conducting  an
          administrative review of its anti-dumping and countervailing duty
          orders  of July  1996 relating  to three  Turkish and  16 Italian
          pasta producers, including  Barilla and De Cecco.  The Department
          of Commerce indicated that it  intends to complete its review not
          later than July 31, 1998.  The Company cannot predict the outcome
          of the Department of Commerce's review.

          Pasta Industry and Markets 
          --------------------------

               North American pasta consumption exceeded 5.0 billion pounds
          in  1996 and  is expected  to grow  based on  industry and  trade
          sources  and the  Company's  own  analysis.  The  pasta  industry
          consists  of  two  primary customer  markets:  (i)  Retail, which
          includes grocery stores, club stores and mass merchants that sell
          branded   and  private  label   pasta  to  consumers;   and  (ii)
          Institutional, which includes both food service distributors that
          supply restaurants,  hotels, schools  and hospitals,  as well  as
          food processors that use pasta as a food ingredient. In 1996, the
          supermarket   portion  of   the   Retail  market   accounted  for
          approximately  1.3 billion pounds,  of which branded  and private
          label pasta  accounted for  1.0 billion and  0.3 billion  pounds,
          respectively. Food service distributors, food  processors and the
          U.S. government  in the  Institutional market  accounted for  the
          remainder of  the volume,  approximately 3.7  billion pounds,  in
          1996.

               The  expected  increase  in North  American  consumption  is
          primarily attributable to  the widespread recognition  that pasta
          is  an  inexpensive,  convenient and  nutritious  food.  The U.S.
          Department of Agriculture places pasta on the foundation level of
          its pyramid of recommended food groups. Products such as flavored
          pasta, prepared sauces, boxed pasta  dinners, and both frozen and
          shelf-stable prepared pasta  entrees support consumers' lifestyle
          demands for convenient at-home meals. Pasta continues to grow  in
          popularity in restaurants as Americans continue to dine away from
          home more frequently.

               Pasta Production  Capacity. Management  believes that  pasta
          producers   have   historically   rationalized   their   existing
          production facilities.  Within the past  several years,  however,
          there  has been  an  increase in  some  pasta producers'  capital
          reinvestment. Upon completion of the planned expansion, AIPC will
          have increased its production capacity to over 600 million pounds
          since  commencing operations  in  1988.  Several  domestic  pasta
          producers have  recently completed production  facility additions
          or  announced their  intention  to  increase domestic  production
          capacity.  In  addition  to  AIPC's  planned  capital  expansion,
          management believes that these  capacity additions represent more
          than 200  million pounds  in aggregate.  Dakota Growers  recently
          increased the capacity of its  durum wheat mill and has announced
          plans to complete a pasta production capacity expansion in excess
          of 100 million pounds by the end  of 1997. Hershey is believed to
          have  recently added  approximately 50  million  pounds of  pasta
          capacity  to its facility  in Winchester, Virginia.  In September
          1997, Barilla announced  plans to build a pasta  plant near Ames,
          Iowa  with an estimated  annual pasta capacity  approximately 150
          million  pounds. Two  major pasta  producers  have also  recently
          announced planned reductions in pasta production capacity. Borden
          announced  that it  will close  or  sell five  of  its ten  North
          American pasta  plants by  the end  of 1997,  and CPC  intends to
          eliminate its capacity of approximately 180 million pounds by the
          end of 1997. AIPC and Dakota Growers are currently the only major 
          pasta producers  that own vertically-integrated milling and pasta
          production  facilities.  Barilla  has  announced  that  its  new,
          vertically-integrated Iowa  pasta  plant  will  include  milling,
          production and warehouse facilities.

               Management estimates  pasta imported from  foreign producers
          during 1996 represented approximately 12%  of the U.S. dry  pasta
          market,  and   that  of  this  amount,  approximately  two-thirds
          originated  from producers  in  Italy  and  Turkey.  The  primary
          foreign suppliers  of pasta with  which the Company  competes are
          Barilla and De Cecco.

               Pricing pressures from  Turkish and Italian  pasta producers
          aggressively targeting the  U.S. markets have adversely  affected
          returns and earnings  of some U.S. producers in  recent years. In
          1996,  pasta imported from Italy accounted for approximately $140
          million in  sales, or around  8.0% of the  U.S. pasta market.  In
          1996, a U.S.  Department of Commerce investigation  revealed that
          several Italian  and Turkish  producers were  engaging in  unfair
          trade practices by selling  pasta at less than fair value  in the
          U.S.  markets and benefiting from subsidies from their respective
          governments. Effective  July 1996,  the U.S. International  Trade
          Commission imposed anti-dumping duties ranging from 2.8% to 46.7%
          on Italian imports and from 56.8% to 63.3% on Turkish imports, as
          well as  countervailing  duties ranging  from  1.2% to  11.2%  on
          Italian  imports and  from  3.9%  to  15.8% on  Turkish  imports.
          Although Italian and  Turkish importers still participate  in the
          major  U.S.  customer  markets,  management believes  that  these
          duties  have significantly reduced the volume of low-priced pasta
          from Italy and Turkey.

               Customer  Markets - Retail. Hershey, Borden and CPC together
          represent a majority of the branded Retail market. Hershey, which
          primarily competes in the branded Retail market  and whose retail
          brands include Ronzoni, San Giorgio, Skinner and American Beauty,
          is the  industry leader  and produced 24.0%  of the  total pounds
          sold  in  the  branded  Retail  market for  the  53  weeks  ended
          September 30, 1997.  Borden, which  produced 20.4%  of the  total
          pounds sold in the Retail market for the 53 weeks ended September
          30, 1997,  has announced its  intention to shift its  strategy to
          focus  on its  branded pasta  and sauce  products,  which include
          Creamette,  Prince, Catelli, Merlino's and Anthony's, and to exit
          private label pasta production and sales. CPC participates in the
          Retail market with Mueller's, the oldest and largest pasta  brand
          in the United States.  AIPC directly participates in the  branded
          Retail  market  by  producing  and  distributing  Pasta   LaBella
          flavored pasta and will indirectly participate  in such market by
          processing and distributing Mueller's brand pasta for CPC. During
          1998,  CPC will transfer substantially all of its Mueller's brand
          pasta production to AIPC.

               Between the Company's first fiscal  quarter of 1994 and  the
          fourth  fiscal  quarter of  1997,  sales of  private  label pasta
          products increased  from 18.6%  to 21.0% of  the total  pounds of 
          pasta sold  in the  Retail market based  on A.C.  Nielsen scanner
          data.  Management  believes  that sales  of  private  label pasta
          products will continue to grow at a rate in excess of the overall
          Retail  pasta market. After  Borden's departure from  the private
          label market, AIPC  will be one  of the leading suppliers  in the
          remaining fragmented market. Management believes that the private
          label category offers significant growth and profit opportunities
          to  retailers  and  efficient producers.  Retailers  often prefer
          high-quality  private label products  to branded products because
          private  label products  typically enable  retailers to  generate
          higher  margins   and  maintain  greater   control  of   in-store
          merchandising. While consumers traditionally have viewed  private
          label products  as having  lower quality  than branded  products,
          management believes that new high-quality  private label products
          have  begun to change this perception. Management attributes some
          of this  change in the  private label market to  the increasingly
          upscale  image, improved  packaging, higher  product quality  and
          competitive prices of private label products.

               Customer Markets -  Institutional. The Institutional  market
          includes both food service distributors  that supply restaurants,
          hotels,  schools and hospitals,  as well as  food processors that
          use   pasta  as  a  food  ingredient.  Traditional  food  service
          customers include businesses and organizations, such as Sysco and
          JP  Food  service,  Inc.,  that  sell  products  to  restaurants,
          healthcare facilities, schools,  hotels and industrial  caterers.
          Most food  service distributors obtain their supply of pasta from
          third party  producers such as  AIPC. The food service  market is
          highly-fragmented  and is served  by numerous regional  and local
          food distributors,  including  both  "traditional"  food  service
          customers  and chain  restaurant customers.  Sysco, the  nation's
          largest food  service marketer  and distributor  of food  service
          products and one of the nation's largest commercial purchasers of
          pasta  products, serves  approximately 10%  of  the food  service
          customers  in the  United States  and  has more  than double  the
          revenues of the next largest food service distributor.

               The  Institutional  market  also   includes  sales  to  food
          processors who use pasta as  an ingredient in their food products
          such  as frozen  dinner entrees  and side  dishes, dry  side dish
          mixes, canned soups and single-serve meals. Large food processors
          that use pasta as a food ingredient include Kraft Foods, American
          Home Food  Products Corporation,  Stouffers Corp., Campbell  Soup
          Company,   ConAgra,  Inc.,  Pillsbury   and  General  Mills.  The
          consistency  and quality of  the color, starch  release, texture,
          cooking  consistency, and  gluten and  protein  content of  pasta
          produced  for food  processors  is  crucial  to  their  products'
          success.  As   a   result,   food   processors   have   stringent
          specifications for these attributes.

               The  size of  the Institutional  market is  affected by  the
          number of food processors that elect to  produce pasta internally
          rather  than  outsourcing  their  production. Historically,  most
          pasta used by food processors was manufactured internally for use 
          in food processors' own  products. Management believes,  however,
          that an increasing number of food  processors may discontinue the
          internal  production of  their  own  pasta  and  outsource  their
          production to efficient producers such as AIPC.

          Management Information Systems
          ------------------------------

               The Company's production, distribution, sales and  marketing
          operations are supported  by an IBM AS400-based  computer system.
          The system  utilizes licensed BPCS  manufacturing software  which
          has  been  tailored  to the  Company's  management  processes and
          integrates  its production,  purchasing,  order entry,  inventory
          management, distribution  and accounting  systems. The  Company's
          management  information   systems  were   recently  upgraded   in
          anticipation  of the Company's  growth and desire  to continue to
          offer its customers value-added,  efficient services. The Company
          has invested  substantial amounts in  electronic data interchange
          and  efficient consumer response systems to streamline the order,
          invoicing  and  inventory   management  functions.  The   Company
          believes  that its  recent hardware  and  software upgrades  have
          adequately addressed  the systems  operations issues relating  to
          the year 2000.

          Government Regulation; Environmental Matters
          --------------------------------------------

               The  Company  is  subject to  various  laws  and regulations
          relating  to  the  operation of  its  production  facilities, the
          production, packaging, labeling and marketing of its products and
          pollution   control,   including   air   emissions,   which   are
          administered by federal, state, and other governmental  agencies.
          The  Company's production facilities are subject to inspection by
          the U.S. Food and Drug Administration and Occupational Safety and
          Health  Administration,  the   Missouri  Department  of   Natural
          Resources  and  the  South  Carolina  Department  of  Health  and
          Environmental Control.  

          Employees
          ---------

               As of September 30, 1997, the Company employed 289 full-time
          persons, of whom 130 were  salaried employees and 159 were hourly
          employees. The  Company's employees  are not  represented by  any
          labor unions. AIPC considers its employee relations to be good.

          ITEM 2.   PROPERTIES.

               Production Facilities.  AIPC's pasta  production plants  are
          located near Kansas  City in Excelsior Springs, Missouri,  and in
          Columbia,   South   Carolina.   The   Company's  facilities   are
          strategically  located to support  North American distribution of
          AIPC's products and benefit from the rail  and interstate highway
          infrastructure. At  September 30, 1997,  the Company's facilities
          had   combined  annual   milling  and   production  capacity   of 
          approximately  300 million  pounds  of  durum  semolina  and  330
          million pounds of pasta.

               The Company has  pursued a capacity expansion  strategy over
          the  past several  years. During  1994, the  Company  completed a
          $30.0   million  expansion  of  the  Missouri  plant,  increasing
          production capacity more than 70%  to 230 million pounds per year
          and, at the same time, increased its durum wheat milling capacity
          over  100% to  support  pasta  production  of  approximately  300
          million pounds per year. In 1995, the Company added approximately
          100 million pounds  of pasta capacity  by constructing its  South
          Carolina plant.

               AIPC's  current  capital expenditure  program  will increase
          AIPC s current pasta production capacity  by 90% from 330 million
          pounds per year  to 620 million pounds  per year in 1998.  At the
          Company s Missouri  facility, the  Company will  be adding  high-
          speed, high-output  pasta production  lines with  the ability  to
          produce a full  range of products and  expanding the distribution
          center.  The  capital  expenditures  program  also  includes  the
          construction of  a  durum  wheat  mill in  South  Carolina  which
          adjoins  the existing  pasta production  plant  facility, a  200%
          increase  in  the  facility's pasta  production  capacity,  and a
          doubling  of  the  capacity of  the  South  Carolina distribution
          center.

               The  additional capacity will  be used to  produce Mueller's
          brand pasta  and take  advantage of  other market  opportunities.
          CPC's guaranteed annual  minimum purchases of 175  million pounds
          pursuant  to the CPC Agreement will  utilize approximately 60% of
          the Company's newly-added pasta production capacity.

               Distribution  Centers.   The  Company  currently   owns  the
          distribution center adjoining  its Missouri plant and  leases its
          distribution  center in  South Carolina  as  well as  space in  a
          public warehouse  in Southern  California. The Company  completed
          construction  of  the  integrated  warehousing  and  distribution
          facilities at its  Missouri and South Carolina  facilities during
          1995. 

          ITEM 3.   LEGAL PROCEEDINGS.

               The Company currently is not  a party to any litigation, nor
          is it  aware of  any litigation threatened  against it  which, if
          commenced and  adversely  determined,  management  expects  would
          likely  have  a material  adverse  effect  upon the  business  or
          financial condition of the Company.


          ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

               The Company did not submit  any matters to its  stockholders
          during  the fourth  quarter of the  Company's most  recent fiscal
          year. 

          EXECUTIVE OFFICERS OF THE REGISTRANT

               Pursuant  to General  Instruction  G(3)  of  Form  10-K  and
          instruction 3 to paragraph (b) of Item 401 of Regulation S-K, the
          following list is  included as an  unnumbered Item in  Part I  of
          this Annual Report in lieu of being included in AIPC's Definitive
          Proxy Statement which  will be filed no later than 120 days after
          September 30, 1997.  All executive officers are  elected annually
          and serve at the discretion of the Board of Directors. Certain of
          the  executive  officers  have  employment  agreements  with  the
          Company.

               The   following  table   sets   forth  certain   information
          concerning each  of the executive  officers of the Company  as of
          September 30, 1997.

          NAME                          AGE         POSITION
          ----                          ---         --------

          Horst W. Schroeder.......     56        Chairman of the Board
                                                  of Directors

          Timothy S. Webster.......     35        President and Chief
                                                  Executive Officer;
                                                  Director

          Norman F. Abreo..........     47        Executive  Vice President
                                                  -- Operations

          David E. Watson..........     42        Executive Vice President
                                                  and    Chief    Financial
                                                  Officer

          David B. Potter..........     38        Senior Vice President  --
                                                  Procurement

          Darrel E. Bailey.........     45        Senior Vice President -
                                                  Institutional Sales and
                                                  Marketing

               Horst W.  Schroeder has served  as Chairman of the  Board of
          Directors of  the Company since  June 1991, and as  a Director of
          the Company since August 1990. Since 1990, Mr. Schroeder has been
          President  of HWS  &  Associates,  Inc.,  a  Hilton  Head,  South
          Carolina management consulting firm owned by Mr. Schroeder. Prior
          to founding HWS  & Associates, Mr.  Schroeder served the  Kellogg
          Company,  a manufacturer and  marketer of ready-to-eat  and other
          convenience food products, in various capacities for more than 20
          years, most recently as President and Chief Operating Officer. He
          is a manager of PSF Holdings,  L.L.C. and has served as  Chairman
          of the  Board of  its wholly-owned  subsidiary, Premium  Standard
          Farms, Inc., a vertically-integrated pork producer, since 1996. 

               Timothy S.  Webster has served  as President of  the Company
          since June 1991, as President  and Chief Executive Officer of the
          Company since May 1992, and as  a Director since June 1989.   Mr.
          Webster joined  the Company  in April 1989,  and served  as Chief
          Financial Officer  from May  1989 to December  1990 and  as Chief
          Operating Officer from December 1990  to June 1991.  In addition,
          in  August 1997 Mr.  Webster assumed responsibility  for managing
          the Company's sales and marketing functions.

               Norman F. Abreo joined the Company in December 1991, serving
          initially  as the Company's  Vice President --  Manufacturing. He
          became  Senior  Vice  President-- Operations  in  June  1995, and
          Executive Vice  President --  Operations in June  1997. Prior  to
          joining  the  Company, he  was  Plant Manager  for  the Coca-Cola
          Enterprises,  Inc. plant in New Orleans, Louisiana, from December
          1987  to December 1991;  Director of Operations  for Borden Pasta
          Group from December  1985 to December 1987; and  Plant Manager of
          the Borden Pasta Group's New  Orleans facility from March 1979 to
          December 1985.

               David  E. Watson  joined the  Company  in June  1994 as  its
          Senior  Vice  President  and  Chief  Financial  Officer.  He  was
          promoted  to Executive Vice President and Chief Financial Officer
          in  June, 1997. Prior to joining AIPC,  Mr. Watson spent 18 years
          with the accounting firm of  Arthur Andersen & Co., most recently
          as  partner-in-charge of  its  Kansas  City  and  Omaha  Business
          Consulting Group  practice.   Mr. Watson  is  a certified  public
          accountant.

               David B. Potter  joined the Company in 1993  as its Director
          of Procurement.  He was named  Vice President in 1994  and Senior
          Vice President --  Procurement in June 1997.   Before joining the
          Company,  Mr. Potter  had worked  in numerous  areas of  Hallmark
          Cards and its subsidiary, Graphics International Trading Company,
          from 1981 to 1993, most recently as Business Logistics Manager.

               Darrel  E. Bailey  joined the  Company in  1993 as  its Vice
          President  -  Retail Sales  and Marketing.   He was  named Senior
          Vice  President     Institutional Sales  and  Marketing  in 1995.
          Before joining  the Company,  Mr. Bailey had  worked at  Hallmark
          Cards  from 1991  to 1993,  most recently  as  Marketing Business
          Manager of Party Goods.

               There are  no  arrangements or  understandings  between  the
          executive  officers and  any other  person pursuant to  which the
          executive officer was or  is to be selected as an officer, except
          with  respect  to the  executive officers  who have  entered into
          employment agreements, which agreements designate the position(s)
          to be held by the executive officer.

               None of  the above  officers are related  to one  another by
          family.

          <PAGE> 

                                       PART II

          ITEM 5.   MARKET  FOR  REGISTRANT'S  COMMON  EQUITY  AND  RELATED
                    STOCKHOLDER MATTERS.

               The  Company's Class A  Convertible Common Stock,  par value
          $0.001 per share  (the "Class A common  stock") is traded  on the
          New York  Stock Exchange under  the symbol "PLB". Trading  of the
          Company's Class A common stock began after  the close of the most
          recent fiscal year covered by this Annual Report.

               As  of December  12, 1997,  there  were 271  holders of  the
          Company's Class A common stock.  No shares of the Company's Class
          B  Convertible  Common Stock,  par  value $0.001  per  share (the
          "Class  B common  stock" and  together  with the  Class A  common
          stock, the  "Common Stock") are  outstanding on the date  of this
          Annual Report.

               The Company  has not declared  or paid any dividends  on its
          Common  Stock to  date and  does not  anticipate paying  any such
          dividends  in  the  foreseeable future.  The  Company  intends to
          retain earnings for  the foreseeable future to provide  funds for
          the operation and expansion of its business and for the repayment
          of  indebtedness.  The  borrowing   agreements  relating  to  the
          Company's  current  credit  facility contain  certain  provisions
          which  effectively  prohibit  the payment  of  dividends.  Future
          borrowing  agreements of the Company may also contain limitations
          on the payment  of dividends. Any determination  to pay dividends
          in the future will be at the discretion of the Company's Board of
          Directors and will depend upon the Company's financial condition,
          capital requirements,  results of  operations and  other factors,
          including  any  contractual  or  statutory  restrictions  on  the
          Company's  ability  to  pay  dividends.     The  Company  has  no
          restricted retained earnings at September 30, 1997.

          Securities Sold in Unregistered Offerings during Fiscal Year 1997
          -----------------------------------------------------------------

               (a)  On  April 15, 1997, the Company  issued an aggregate of
                    3,174,528 shares  of Class  A common  stock, par  value
                    $0.01 per share (the "Old  Class A common stock"), at a
                    cash  purchase  price of  $7.02 per  share, aggregating
                    $22,291,947,  to   all  but  one  of  the  then-current
                    stockholders  of the Company and several members of the
                    Company's  management team  (the  "1997 Private  Equity
                    Financing"), all  of whom are  officers, directors  and
                    senior  managers or a  spouse thereof.   In particular,
                    the  Company issued an aggregate of 2,563,323 shares to
                    The  Morgan  Stanley  Capital  Partners III,  L.P.  and
                    certain  affiliated funds  (the "MSCP  Funds")  and The
                    Morgan   Stanley  Leveraged   Equity   Fund  II,   L.P.
                    ("MSLEF"),  427,219  shares  to  affiliated  investment
                    funds of  George K.  Baum  & Company,  an aggregate  of
                    49,056 shares to a trust  of which Mr. Schroeder is the 
                    trustee   and   members   of   his   family   are   the
                    beneficiaries, an  aggregate  of 28,483  shares to  Mr.
                    Schlindwein, his wife  and JSS Management Co.  Ltd. (an
                    affiliate of  Mr. Schlindwein), an  aggregate of 20,242
                    shares to  Mr. Webster  and trusts  for the benefit  of
                    members  of his  family,  42,513  shares  to  David  E.
                    Watson,  5,194 shares  to Norman  F.  Abreo and  13,024
                    shares to David P. Potter.  In this sale of securities,
                    the  purchasers   made  representations  as   to  their
                    investment intent, a restrictive legend was included on
                    the  stock  certificates,  and   no  underwriters  were
                    involved and  no commission  or other  fees were  paid.
                    All of  such  sales  were  made  in  reliance  upon  an
                    exemption  from  the registration  requirements  of the
                    Securities Act set forth in Section 4(2) thereof.

               (b)  On June  24, 1997, the Company issued  31,200 shares of
                    Old Class  A common stock to the American Italian Pasta
                    Company   Retirement  Savings   Plan  pursuant   to  an
                    exemption from registration  requirements set forth  in
                    Section 3(a)(2) of the Securities Act.

          Use of Proceeds from Initial Public Offering
          --------------------------------------------

               The  Securities   and  Exchange   Commission  declared   the
          Company's registration  statement   on Form  S-1 (Securities  and
          Exchange  Commission  file   no.  333-32827)  (the  "Registration
          Statement") concerning the initial public offering of the Class A
          convertible common stock,  par value $0.001 per  share, effective
          on,  and  that offering  commenced  on,  October  8, 1997.    The
          managing underwriters for  the offering in the United States were
          Morgan Stanley &  Co. Incorporated, BT Alex.  Brown Incorporated,
          Goldman, Sachs  & Co.  and  George K.  Baum  & Company,  and  the
          managing underwriters for the International  offering were Morgan
          Stanley   &   Co.   International   Limited,   BT   Alex.   Brown
          International, a  division  of Bankers  Trust International  PLC,
          Goldman Sachs International and George K. Baum & Company. 

               That  offering  has  terminated and  all  registered  shares
          (9,085,000),  including the 1,185,000 shares covered by the over-
          allotment option granted  to the U.S. Underwriters,  were sold by
          the  Company and the  selling stockholders (identified  below) as
          follows.

          <TABLE>                                           
          <CAPTION>
                                   CLASS A                  AGGREGATE
                                   SHARES                   OFFERING
                                   REGISTERED               PRICE
          SELLING PARTY            AND SOLD                 RECEIVED<F1>
          --------------------     -------------            -------------- 
          <S>                      <C>                      <C>

          The Company              5,310,000                $88,995,600

          The Morgan Stanley
           Leveraged Equity
           Fund II, L.P.           2,207,746<F2>             37,001,823

           
          Morgan Stanley
           Capital Partners
           III, L.P.<F3>             973,254<F2>             16,311,737
           
          Richard C. Thompson        630,000                 10,558,800
           

          <FN>
          <F1> Reflects  an underwriting discount  of $1.24 per  share from
          the  offering price  to  the public  of $18.00  per  share.   Net
          proceeds (prior to expenses other than the underwriting discount)
          to the sellers was $16.76 per share.  The Company did not receive
          any of the proceeds received by the selling stockholders. 

          <F2> Includes  the   over-allotment  option   granted  by   these
          stockholders.   No  over-allotment  option  was  granted  by  the
          Company.

          <F3> Includes certain affiliated funds. 
          </FN>
          </TABLE>

               The Company  incurred the following  expenses in  connection
          with the initial public offering:

               Underwriting Discounts and Commissions  $6,584,400
               Finder's Fees                                    0
               Expenses Paid to or for the Underwriters         0
               Other Expenses                           2,000,000*
                                                       ----------

               Total Offering Expenses                 $8,584,000
                                                       ==========

          *    These expenses  are estimated for the purpose of this Annual
               Report.

               These expenses are payable to or have been paid, directly or
          indirectly, to persons other than any: (i) director or officer of
          the  Company  or their  associates;  (ii) 10  percent  or greater
          beneficial owner of the Company's  Class A common stock; or (iii)
          affiliate of the Company other than a portion of the underwriting
          discount  paid  to  associates of  The  Morgan  Stanley Leveraged
          Equity  Fund II,  L.P. and  Morgan Stanley Capital  Partners III, 
          L.P. and Jonathan E. Baum, who controls George K. Baum & Company.

               The  net proceeds to  the Company after  deducting the total
          offering expenses  were $87 million.   The Company used  the full
          amount  of the  net  proceeds  from the  offering  to repay  bank
          indebtedness. This application of the proceeds is consistent with
          the use of proceeds described in the Registration Statement. This
          amount has  been paid, directly  or indirectly, to  persons other
          than  any:  (i) director  or  officer  of  the Company  or  their
          associates; (ii) 10  percent or greater  beneficial owner of  the
          Company's  Class  A  common  stock;  or  (iii)  affiliate of  the
          Company. 

          ITEM 6.   SELECTED FINANCIAL DATA.

               The selected  statement of  operations data  for the  fiscal
          year ended  December 31, 1995, the nine-month fiscal period ended
          September 30, 1996, and the  fiscal year ended September 30, 1997
          and the selected balance sheet data as  of September 30, 1996 and
          September  30, 1997  are derived  from  the Financial  Statements
          including the  Notes thereto  of the Company  audited by  Ernst &
          Young   LLP,  independent  auditors,   and  its  opinion  thereon
          appearing elsewhere in this Annual Report. The selected statement
          of operations data for the years ended December 31, 1993 and 1994
          and the selected balance sheet data as of December 31, 1993, 1994
          and  1995 have  been  derived from  financial  statements of  the
          Company not included  herein, which have been audited  by Ernst &
          Young  LLP.  The selected  statement of  operations data  for the
          calendar year ended December 31, 1996 and the twelve-month period
          ended  September  30, 1996  and  the  balance  sheet data  as  of
          December 31,  1996 have been derived from the Company's unaudited
          internal   financial  statements,   which  in   the  opinion   of
          management, have been  prepared on the same basis  as the audited
          financial statements and  reflect all adjustments, consisting  of
          normal recurring adjustments, necessary  for a fair  presentation
          of  the  results of  operations  and  financial position  of  the
          Company. The statement of operations  data of the Company for the
          calendar year ended December 31, 1996 and the twelve-month period
          ended  September  30, 1996  and  the  balance  sheet data  as  of
          December 31,   1996  are  included  herein  only  for  comparison
          purposes.  The selected  other  data has  been  derived from  the
          accounting records of  the Company and has not  been audited. The
          selected financial and other data  set forth below should be read
          in   conjunction  with,  and   is  qualified  by   reference  to,
          "Management's Discussion and Analysis of Financial Condition  and
          Results of  Operations" and  the Company's  Financial Statements,
          including the Notes  thereto, appearing elsewhere in  this Annual
          Report. The Company  has not paid  any dividends on  its Class  A
          common stock during the periods indicated below.

      <TABLE>
     <CAPTION>
                                                                             NINE
                                                                             MONTH       TWELVE-
                                                                             FISCAL      MONTH      FISCAL
                                                                  CALENDAR   PERIOD      PERIOD     YEAR
                                                                  YEAR       ENDED       ENDED      ENDED
                                                                  ENDED      SEPT-       SEPT-      SEPT-
                                   FISCAL YEAR ENDED DECEMBER 31, DEC-       EMBER       EMBER      EMBER
                                   -----------------------------  EMBER 31   30,         30,        30,
                                     1993      1994      1995     1996<F1>   1996<F1>    1996       1997
                                     ----      ----      ----     --------   ---------   -------    -----
     -
                                                                (UNAUDITED)            (UNAUDITED)       
                                              (IN THOUSANDS, EXCEPT PER SHARE DATA AND PERCENTAGES)

     <S>                            <C>       <C>       <C>       <C>         <C>          <C>        <C>

     STATEMENT OF OPERATIONS DATA:

     Revenues                       $47,872   $69,465   $ 92,903   $121,621   $  92,074     $121,149  $129,143
     Cost of goods sold              35,081    54,393     73,851     89,704      68,555       91,230    93,467
     Plant expansion
      costs <F2>                      1,171       484      2,065         --          --           --        --
                                    -------   -------   --------   --------   ---------    ---------  --------
     Gross  profit                   11,620    14,588     16,987     31,917      23,519       29,919    35,676

     Selling and marketing expense,
       including product introduction
       costs  <F3>                    2,883     3,792      5,303     21,250      16,798       18,445    13,664
     General and administrative
       expense                        2,049     1,951      2,930      3,498       2,805        3,686     3,766
                                    -------   -------   --------    -------   ---------    ---------  --------  

     Operating profit                 6,688     8,845      8,754      7,169       3,916        7,788    18,246
     Interest expense, net            3,210     4,975      8,008     10,575       8,023       10,770    10,119
                                    -------   -------   --------   --------   ---------    ---------  --------
     Income (loss) before income tax
       and extraordinary loss         3,478     3,870        746     (3,406)     (4,107)      (2,982)    8,127
     Income tax                      (3,221)    1,484        270     (1,288)     (1,556)      (1,139)    3,070
     Extraordinary loss, net of
       income tax <F4>                   --       204         --      1,647       1,647        1,647        --
                                    -------   -------   --------   --------   ---------    ---------  --------

     Net income (loss)              $ 6,699   $ 2,182   $    476    $(3,765)  $  (4,198)   $  (3,490) $  5,057
                                    =======   =======   ========    =======   =========    =========  ========
     ---Net income (loss) per
       common share <F5>            $   .64   $   .21   $    .05   $   (.36)  $    (.40)   $   (.33)  $    .42
     Weighted average
       common shares
       outstanding <F5>              10,390    10,401     10,445     10,475      10,473       10,470    12,161

     BALANCE SHEET DATA
       (AT END OF PERIOD):
     Cash and temporary
      investments                   $ 2,149  $    11    $    18    $  1,678   $   1,818    $   1,818  $  2,724 
     Working capital                  3,077    4,830      6,632      (1,965)     (1,601)      (1,601)   12,188
     Total assets                    66,337   93,629    135,424     137,974     141,688      141,688   158,175
     Long-term debt, less 
       current maturities            40,024   62,375     97,452      92,143      93,284       93,284   100,137
     Stockholders'  equity           16,973   19,401     20,067      16,402      15,969       15,969    42,984

          <FN>
          <F1> The Company adopted a fiscal  year ending on the last Friday
          of  September or the first Friday of October, effective beginning
          with the nine-month  fiscal period ended  September 27, 1996  and
          for all subsequent fiscal periods.  For purposes of this Form 10-
          K, the 1996 nine-month fiscal period and the 1997 fiscal year are
          shown as having ended on September 30.

          <F2>  Plant  expansion  costs   include  incremental  direct  and
          indirect manufacturing and distribution costs which are  incurred
          as a  result of construction,  commissioning and start-up  of new
          capital  assets. These  costs are  expensed  as incurred  but are
          unrelated to current production and, therefore, are reported as a
          separate line item in the statement of operations.

          <F3> Selling  and marketing expense includes  incremental product
          introduction  costs, including  payment  of product  placement or
          "slotting" fees,  related to  the Company's  launch of  its Pasta
          LaBella  flavored pasta  products into  the  U.S. retail  grocery
          market. The Company did not incur such product introduction costs
          prior  to  the  calendar year  ended  December 31,  1996. Product
          introduction  costs were  incurred as  follows:  $9.6 million  in
          calendar  year ended  December  31, 1996,  $8.1  million for  the
          nine-month and twelve-month periods ended September 30, 1996, and
          $2.9 million for the fiscal year ended September 30, 1997.

          <F4> Represents losses  due to early extinguishment  of long-term
          debt, net of income tax.

          <F5> Earnings per share is presented on  a pro forma basis giving
          effect  to the consummation of the Recapitalization in connection
          with the Offering.
          </FN>
          </TABLE>
           
          ITEM 7.   MANAGEMENT'S  DISCUSSION  AND   ANALYSIS  OF  FINANCIAL
                    CONDITION AND RESULTS OF OPERATION.

          Introduction and Certain Cautionary Statements
          ----------------------------------------------

               Management's  discussion  and   analysis  of  the  Company's
          financial condition and results of its operations focuses on  and
          is  intended  to  clarify the  Company's  results  of operations,
          certain  changes in  its  financial position,  liquidity, capital
          structure  and business developments  for the periods  covered by
          the consolidated  financial statements  included  in this  Annual
          Report. This discussion  should be read in conjunction  with, and
          is  qualified  by  reference to,  the  other  related information
          including, but not  limited to, the audited  financial statements
          (including  the  notes  thereto  and  the  independent  auditor's
          opinion  thereon), the description of the Company's business, all
          as set forth in this Annual  Report, as well as the risk  factors
          discussed in  the Company's Current  Report on 8-K  dated October
          29, 1997 (the  "Risk Factors"),  which has  been incorporated  by
          reference into this  Annual Report  as if it  is fully set  forth 
          herein.  

               As previously noted, the discussion set forth below, as well
          as  other portions  of this  Annual  Report, contains  statements
          concerning potential future  events.  Readers can  identify these
          forward-looking statements by their use of such verbs as expects,
          anticipates,  believes or similar  verbs or conjugations  of such
          verbs.    If  any  of  management's  assumptions  on  which   the
          statements are  based  prove incorrect  or  should  unanticipated
          circumstances   arise,  the   Company's   actual  results   could
          materially differ from those anticipated by such  forward-looking
          statements.   The  differences could  be  caused by  a number  of
          factors  or combination of factors including, but not limited to,
          the Risk Factors.   Readers are  strongly encouraged to  consider
          those factors when evaluating any such forward-looking statement.
          The Company  will not  update any  forward-looking statements  in
          this Annual Report to reflect future events or developments.

               The Company changed its fiscal  year end from December 31 to
          the last Friday of September or the first Friday of October. This
          change  resulted in  a  nine-month  fiscal year  for  1996 and  a
          53-week year  for fiscal 1997, and a 52-  or 53-week year for all
          subsequent  fiscal  years.  The  Company's  first   three  fiscal
          quarters end on the Friday  last preceding December 31, March 31,
          and June 30  or the first Friday  of the following month  of each
          quarter. For purposes of this Form 10-K, the  1996 fiscal year is
          described as  the nine-month  fiscal period  ended September  30,
          1996. The unaudited  statement of operations data  of the Company
          for  the  nine-month  period ended  September  30,  1995 and  the
          unaudited  twelve-month period ended  September 30, 1996  and the
          calendar  year ended December  31, 1996 are  included herein only
          for comparison purposes. 
               For  purposes of  management's  discussion  and analysis  of
          fiscal year 1997 is compared to the unaudited twelve month period
          ended September 30, 1996  and the fiscal year 1996 is compared to
          the unaudited nine month  period ended September 1995.   Although
          the  comparative periods are  unaudited, the financial statements
          on   which  the  discussion  is  based  contain  all  adjustments
          necessary to fairly present the financial position of the Company
          and the results of its operations for those undaunted periods.

          Recent Events
          -------------

          Restructuring  of  Revolving  Credit Facility  and  Write  Off of
          Deferred Debt Issuance Costs.

               On October 17,  1997, the Company completed  a restructuring
          of  its primary bank  credit facility. The  restructured facility
          initially provides the Company with  $150 million in credit on an
          unsecured, revolving basis at interest  rates which are 250 basis
          points  lower than  the previous  agreement. As  a result  of the
          restructuring   the   Company   anticipates   a   first   quarter
          extraordinary charge of  approximately $2.3 million, net  of tax,
          related to  the write off  of current and deferred  debt issuance
          costs. 

               The  current  and  noncurrent  portions  of  long-term  debt
          outstanding at September 30,  1997 have been reclassified  in the
          Company's  balance sheet to  reflect the scheduled  maturities of
          the new debt.  The terms of the new debt are described more fully
          in Note  2 of  the financial statements  included in  this Annual
          Report.

          Completion of Initial Public Offering.
          -------------------------------------

               The Company  completed the  initial public  offering of  its
          Class A  common  stock  October  8, 1997  (the  "Offering").  All
          registered  shares, including the 1,185,000 shares covered by the
          over-allotment  option,  were  sold by  the  Company  and selling
          stockholders. The  Company has  outstanding 16,776,061 shares  of
          Class A common stock (not including 3,284,663 shares reserved for
          issuance in  connection with equity incentive  plans) outstanding
          upon completion of the Offering.

               The  Company received net proceeds after deducting the total
          offering expenses  of $87 million,  which funding  was closed  on
          October 15, 1997.  The Company used all of  the net proceeds from
          the  offering to  repay bank  indebtedness on  October  16, 1997.
          Following   this   reduction,   the   Company   had   outstanding
          indebtedness  of  $11  million.  The  Company  will incur  up  to
          approximately  $62 million in new indebtedness through the middle
          of  fiscal 1998  to  fund  its  capital  expenditure  program  to
          increase  its  current pasta  production  capacity,  as discussed
          under Item 1 above. 

          Adoption of 1997 Equity Incentive Plan.

               In October  1997, the  Board of  Directors adopted  the 1997
          Equity Incentive Plan (the "1997 Plan") for all employees.  Under
          the  1997 Plan, the Board or a  committee designated by the Board
          is  authorized  to  grant nonqualified  stock  options, incentive
          stock options, reload options, stock appreciation  rights, shares
          of  restricted   Class  A   common  stock,   performance  shares,
          performance units and shares of Class A common stock awarded as a
          bonus.   There  are  2,000,000  shares of  Class  A common  stock
          reserved for  issuance under the  1997 Plan. On October  9, 1997,
          the Board of  Directors granted options to  purchase an aggregate
          of 993,391 shares of Class A common stock at an exercise price of
          $18 per share. The stock options expire 10 years from the date of
          grant, unless  terminated earlier in accordance with the terms of
          the 1997 Plan, and become exercisable over the next five years in
          varying amounts depending on  the terms of the  individual option
          agreements.

          AIPC, Harvest States Working Toward Alliance.

               On November 18, 1997, the Company announced the signing of a
          letter  of   intent  with   Harvest  States   for  the   possible
          construction and operation of a pasta production and distribution
          facility adjacent to Harvest State s mill in  Kenosha, Wisconsin.
          The  finalization  of the  project  is  subject  to a  number  of
          significant conditions, including the  execution of a  definitive 
          agreement with Harvest States.

          Results of Operations
          ---------------------

               The  following  table   sets  forth  certain   statement  of
          operations data  of  the Company,  expressed as  a percentage  of
          revenues, for each of the periods presented.

          <TABLE>
          <CAPTION>
                                                   NINE
                                                   MONTH     TWELVE
                               FISCAL       CALENDAR   FISCAL      MONTH   
          FISCAL
                               YEAR      YEAR      PERIOD    PERIOD   YEAR
                               ENDED     ENDED     ENDED     ENDED    ENDED
                               DEC-      DEC-      SEPT-     SEPT-    SEPT-
                               EMBER     EMBER     EMBER     EMBER    EMBER
                               31,       31,       30,       30,      30,
                               1995      1996      1996      1996     1997
                               ------    ------    ------    ------   ------

          <S>                  <C>       <C>       <C>       <C>      <C>

          Revenues:

          Retail                53.1%     59.6%     60.7%     59.5%    56.7%
          Institutional         46.9      40.4      39.3      40.5     43.3
                               -----     -----     -----     -----    -----
          Total Revenues       100.0%    100.0%    100.0%    100.0%   100.0%
                               -----     -----     -----     -----    -----
          Costs of goods sold   79.5      73.7      74.6      75.3     72.4

          Gross profit before
           plant expansion 
           costs                20.5      26.3      25.4      24.7     27.6

          Plan expansion costs   2.2        --        --        --       --
                               -----     -----     -----     -----    -----
          Gross profits         18.3      26.3      25.4      24.7     27.6

          Selling and marketing
           expense, including
           product introduction
           costs                 5.7      17.5      18.2      15.2     10.6

          General and
           administrative
           expense               3.2       2.9       3.0       3.0      2.9
                               -----     -----     -----     -----    -----
          Operating profit       9.4       5.9       4.2       6.5     14.1
          Interest expense, net  8.6       8.7       8.7       8.9      7.8
          Income tax             0.3      (1.1)     (1.7)     (0.9)     2.4 

          Extraordinary loss,
           net of income tax      --       1.4       1.8       1.4       --
                               -----     -----     -----     -----    -----
          Net  income (loss)     0.5%     (3.1)%    (4.6)%    (2.9)%    3.9%
                               =====     =====     =====     =====    =====

          </TABLE>

          FISCAL YEAR  ENDED SEPTEMBER  30, 1997  COMPARED TO  TWELVE-MONTH
          PERIOD ENDED SEPTEMBER 30, 1996

               Revenues.   Revenues  increased $8.0  million,  or 6.6%,  to
          $129.1 million for the fiscal year ended September 30, 1997, from
          $121.1  million for the  twelve-month period ended  September 30,
          1996. The increase  for the fiscal year ended  September 30, 1997
          was  primarily due  to  increases in  unit  volume. The  revenues
          increase was lower than historical periods as the Company planned
          for  and  achieved higher  than  historical capacity  utilization
          levels  which precluded more significant unit and revenue growth.
          Management expects increased revenue as a result of the long-term
          supply agreement with CPC.

               Revenues  for the Retail  market increased $1.2  million, or
          1.7%, to  $73.3 million for  the fiscal year ended  September 30,
          1997,  from $72.1  million  for  the  twelve-month  period  ended
          September 30, 1996. The increase  reflects gains in private label
          volumes and lower retail sales volumes  of Pasta LaBella flavored
          pasta as the  prior period included introductory   pipeline  full
          shipments.

               Revenues  for   the  Institutional  market   increased  $6.8
          million, or  13.9%, to  $55.9 million for  the fiscal  year ended
          September  30,  1997,  from $49.1  million  for  the twelve-month
          period ended September 30, 1996. This was primarily the result of
          volume gains in ingredient, foodservice, and Contract Sales which
          were partially offset by durum wheat related price reductions and
          changes in sales mix.

               Gross  Profit.    Gross Profit  increased  $5.8  million, or
          19.4%, to $35.7  million for the fiscal year  ended September 30,
          1997,  from $29.9  million  for  the  twelve-month  period  ended
          September 30,  1996. Gross  profit  as a  percentage of  revenues
          increased to 27.6%  for the fiscal year ended  September 30, 1997
          from 24.7% for the twelve-month  period ended September 30, 1996.
          These  increases  were the  result of  increases in  revenues and
          lower  product costs  due  to  improved  plant  efficiencies  and
          capacity utilization.

               Selling  and  Marketing  Expense.    Selling  and  marketing
          expense decreased $4.8 million, or  26%, to $13.7 million for the
          fiscal year ended September 30, 1997, from $18.4 million reported
          for the twelve-month period ended September 30, 1996. Selling and
          marketing expense as a percentage  of revenues decreased to 10.6%
          for the  fiscal year ended September 30, 1997, from 15.2% for the
          comparable prior period. The decrease was primarily due  to lower 
          product  introduction costs  incurred  in  the  Company's  retail
          introduction  of Pasta  LaBella flavored  pasta.   The  Company s
          incurred  $2.9  million  of product  introduction  costs  for the
          fiscal year ended September 30, 1997, as compared to $8.1 million
          for  the  twelve-month  period  ended  September  30,  1996.  The
          decrease in product introduction costs  was due to a reduction in
          introduction  activities  as  the  Company completed  its  retail
          launch.  The decrease in product introduction costs was partially
          offset by increases in other selling and marketing expenses which
          supported incremental private label and branded revenues.

               General   and   Administrative   Expense.      General   and
          administrative  expense increased  $.1 million,  or  2%, to  $3.8
          million for the  fiscal year ended September 30,  1997, from $3.7
          million  reported  for  the  comparable  period  last  year,  but
          decreased as a percentage of revenues from 3% to 2.9%.  

               Operating  Profit.   Operating profit  for  the fiscal  year
          ended September 30, 1997, was $18.2 million, an increase of 133 %
          over the $7.8 million reported for  the twelve-month period ended
          September  30,   1996.  Excluding  product   introduction  costs,
          operating  profit  increased  $5.2 million,  or  32.9%,  to $21.1
          million for the fiscal year  ended September 30, 1997, from $15.9
          million  reported  for  the  comparable  period  last  year,  and
          increased as  a percentage  of revenues to  16.3% for  the fiscal
          year ended September  30, 1997, from  13.1% for the  twelve-month
          period ended September 30, 1996.
           September 30, 1997, was $10.1  million, decreasing 6.5% from the
          $10.8  million  reported  for  the  twelve-month    period  ended
          September  30, 1996.  The  decrease was  primarily the  result of
          reduced  borrowings under the Company s term and revolving credit
          facilities  resulting from the $22.3 million in proceeds realized
          from the April 1997 private equity financing.

               Income Tax.  Income tax  for the fiscal year ended September
          30, 1997,  was $3.1  million, increasing  $4.2  million from  the
          $(1.1)  million  reported  for  the  twelve-month   period  ended
          September 30, 1996, and reflects  an effective income tax rate of
          approximately 38%.

               Net Income.  Net income  for the fiscal year ended September
          30, 1997,  was $5.1 million,  increasing from the  $(3.5) million
          reported  for the twelve-month  period ended September  30, 1996.
          Net income per share was $0.42 in  fiscal 1997 compared to a loss
          of $0.33  per share for  the twelve-month period  ended September
          30, 1996.

               Supplementary  net income  per  share  for  the  year  ended
          September  30, 1997  is $0.57  calculated to  give effect  to the
          reduction of interest expense, net of tax and the increase in the
          weighted  average number of  common and common  equivalent shares
          outstanding sufficient to  retire certain indebtedness as  if the
          retirement had occurred at the beginning of the period affected.

          NINE-MONTH FISCAL PERIOD ENDED SEPTEMBER 30, 1996 COMPARED TO THE
          NINE-MONTH PERIOD ENDED SEPTEMBER 30, 1995 

               Revenues.  Revenues increased  $28.3 million,  or  44.4%, to
          $92.1  million for the  nine-month fiscal period  ended September
          30,  1996, from  $63.8  million for  the nine-month  period ended
          September 30, 1995.  This increase  was primarily  due to  higher
          unit volume, favorable  changes in product  sales mix and  higher
          average prices resulting  from the introduction of  the Company's
          new, higher-priced Pasta LaBella flavored pasta.

               Revenues for the  Retail market increased $23.1  million, or
          70.4%, to  $55.9 million for  the nine-month fiscal  period ended
          September 30, 1996, from $32.8 million  for the nine-month period
          ended September  30, 1995.  This increase was  due to  (i) higher
          sales  volume, with  the largest  increases  coming from  private
          label and club  stores customers; (ii) higher average unit prices
          due to the introduction of the Company's new, higher-priced Pasta
          LaBella flavored pasta into the U.S. retail grocery market; (iii)
          improved product sales  mix in the club store  category; and (iv)
          the pass-through of higher durum wheat costs.

               Revenues  for  the   Institutional  market  increased   $5.2
          million, or  16.8%, to $36.2  million for  the nine-month  fiscal
          period ended  September  30, 1996,  from  $31.0 million  for  the
          nine-month  period ended September 30,  1995. The volume gains in
          ingredient and food  service categories were partially  offset by
          lower Contract Sales volumes as available production capacity was
          utilized by retail  sales growth. The average  1996 institutional
          unit price also increased due to the pass-through of higher durum
          wheat costs.

               Gross  Profit.  Gross  profit  increased  $12.9 million,  or
          121.7%, to $23.5  million for the nine-month fiscal  period ended
          September 30, 1996,  from $10.6 million for the nine-month period
          ended  September  30,  1995.  Gross profit  as  a  percentage  of
          revenues  increased to  25.5% for  the  nine-month fiscal  period
          ended September 30,  1996, from 16.6%  for the nine-month  period
          ended  September 30,  1995. These  increases  were primarily  the
          result  of (i)  higher sales  volumes; (ii)  higher average  unit
          prices, primarily as  a result  of Pasta  LaBella flavored  pasta
          sales; (iii) the absence of plant expansion costs; (iv) lower per
          unit   warehousing   and   distribution  costs   resulting   from
          outsourcing  logistics functions through a new strategic alliance
          with  Lanter Company;  and (v)  improved  plant efficiencies  and
          capacity  utilization,  including  the impact  of  the  new South
          Carolina production and distribution facilities.

               Selling and Marketing Expense. Selling and marketing expense
          increased  $13.1  million, or  354.1%, to  $16.8 million  for the
          nine-month  fiscal period  ended September  30,  1996, from  $3.7
          million  for  the  nine-month period  ended  September  30, 1995.
          Selling  and  marketing  expense  as  a  percentage  of  revenues
          increased  to  18.2%  for  the  nine-month  fiscal  period  ended
          September 30,  1996  from 5.7%  for the  nine-month period  ended
          September  30, 1995.  These increases  in  selling and  marketing
          expense were  primarily due to  the Company's incurrence  of $8.1
          million of  product  introduction  costs  during  the  nine-month
          fiscal  period  ended September  30, 1996  related to  the retail
          introduction  of  the  Company's  Pasta  LaBella  flavored  pasta 
          products.  These costs included payment of product placement fees
          or   "slotting,"  introductory   consumer  sampling,   couponing,
          advertising and trade  promotions. There were no  comparable 1995
          expenditures. Selling  and marketing expenses  also increased due
          to Pasta LaBella flavored pasta sales and increases in club store
          and private label revenues.

               General    and   Administrative    Expense.   General    and
          administrative  expense increased $0.8 million, or 40.0%, to $2.8
          million  for the  nine-month fiscal  period  ended September  30,
          1996, from $2.0 million for the nine-month period ended September
          30, 1995, but decreased as a percentage of revenues from 3.2% for
          the nine-month  period ended September  30, 1995 to 3.0%  for the
          nine-month fiscal period  ended September 30, 1996.  The increase
          in  general and  administrative  expense  was  primarily  due  to
          increases in  MIS expenses  and communication  costs incurred  to
          support sales growth and the commencement of operations in  South
          Carolina.

               Operating  Profit.  Operating profit decreased $1.0 million,
          or 20.4% to  $3.9 million for the nine-month  fiscal period ended
          September  30, 1996 from  $4.9 million for  the nine-month period
          ended  September 30, 1995.  Excluding product introduction costs,
          operating profit increased to $12.0 million, or 144.9%, from $4.9
          million and increased as a percentage of revenue to 13.0% for the
          nine-month fiscal  period ended September 30, 1996  from 7.7% for
          the nine-month period ended September 30, 1995.

               Interest Expense.   Interest expense increased $2.7 million,
          or 50.9%, to $8.0 million  for the nine-month fiscal period ended
          September  30, 1996 from  $5.3 million for  the nine-month period
          ended  September  30, 1995,  due  to higher  borrowing  levels to
          finance  the Company's South Carolina and Missouri capital assets
          expansion and increases in working capital.

               Income Tax. Income tax  decreased to $(1.6) million for  the
          nine-month  fiscal period ended  September 30, 1996,  from $(0.1)
          million for the  nine-month period ended  September 30, 1995  and
          reflected an  effective income tax  rate of approximately  38% in
          both periods.

               Extraordinary  Item.   During  the nine-month  fiscal period
          ended  September 30, 1996,  the Company  incurred a  $1.6 million
          (net of tax) extraordinary loss  due to the write-off of deferred
          debt  issuance costs in conjunction with a partial extinguishment
          and  restructuring   of  the  Company's   principal  bank  credit
          agreement. There was no such item for the nine-month period ended
          September 30, 1995.

               Net Income.   Net  income decreased  $4.0 million to  $(4.2)
          million  for the  nine-month fiscal  period  ended September  30,
          1996,  from  $(0.2)  million  for  the  nine-month  period  ended
          September 30, 1995.

          CALENDAR YEAR ENDED DECEMBER 31, 1996 COMPARED TO THE FISCAL YEAR
          ENDED DECEMBER 31, 1995 

               The calendar year  ended December 31, 1996  does not conform
          to  the Company's  fiscal year  and is  discussed below  only for
          purposes  of  comparison  with the  Company's  fiscal  year ended
          December 31, 1995.

               Revenues.   Revenues increased  $28.7 million, or  30.9%, to
          $121.6  million for the  calendar year  ended December  31, 1996,
          from $92.9 million  for the fiscal year ended  December 31, 1995.
          This increase was due to  higher unit volume, higher average unit
          price  from  the  mid-1996  introduction  of  the  Company's  new
          higher-priced Pasta LaBella  flavored pasta into the  U.S. Retail
          grocery market and improvements in product sales mix.

               Revenues for the  Retail market increased $23.1  million, or
          46.9%, to $72.4 million for  the calendar year ended December 31,
          1996, from $49.3  million for the fiscal year  ended December 31,
          1995. This  increase was  due to (i)  higher average  unit prices
          associated   with  the   introduction   of  the   Company's  new,
          higher-priced Pasta LaBella  flavored pasta into the  U.S. retail
          grocery market in  mid-1996; (ii)  higher unit  volume, with  the
          largest increases  coming from the  private label and  club store
          customers;  (iii)  improved  product  sales  mix;  and  (iv)  the
          pass-through of higher durum wheat costs.

               Revenues  for   the  Institutional  market   increased  $5.6
          million, or  12.8% to $49.2  million for the calendar  year ended
          December 31,  1996 from $43.6  million for the fiscal  year ended
          December 31, 1995.  The ingredient and food  service volume gains
          were   partially  offset  by  lower  Contract  Sales  volumes  as
          available capacities  were utilized  by retail  unit growth.  The
          average  1996 institutional  unit  price  increased  due  to  the
          pass-through of higher durum wheat costs.

               Gross Profit.  Gross  profit  increased  $14.9  million,  or
          87.6%, to $31.9 million for  the calendar year ended December 31,
          1996, from $17.0  million for the fiscal year  ended December 31,
          1995. Gross profit as a percentage of revenues increased to 26.2%
          for the calendar year ended December 31, 1996, from 18.3% for the
          fiscal  year  ended  December  31,  1995.  These  increases  were
          primarily  the result  of (i)  higher  unit volumes;  (ii) higher
          average  unit prices,  primarily due  to  Pasta LaBella  flavored
          pasta sales; (iii)  lower durum wheat costs; (iv)  the absence of
          plant  expansion costs; and  (v) lower  per unit  warehousing and
          distribution costs resulting from outsourcing logistics functions
          through a new strategic alliance with Lanter Company.

               Selling  and  Marketing  Expense.    Selling  and  marketing
          expense increased $16.0 million, or 301.9%, to $21.3  million for
          the calendar year ended December  31, 1996, from $5.3 million for
          the fiscal year  ended December 31,  1995. Selling and  marketing
          expense grew as a percentage of revenue to 17.5% for the calendar
          year ended December 31, 1996, from 5.7% for the fiscal year ended
          December  31,  1995.  This  increase  was  due  to  the Company's
          incurrence of $9.6  million of product introduction  costs during
          the calendar year  ended December 31, 1996 related  to the retail
          introduction  of  the  Company's  Pasta  LaBella  flavored  pasta
          products.  These costs  included  payment  of  fees  for  product 
          placement   or   "slotting,"  introductory   consumer   sampling,
          couponing,  advertising  and  trade  promotions.  There  were  no
          comparable 1995 expenditures. In addition to product introduction
          costs, selling and  marketing expenses also increased due  to the
          larger  retail revenues  associated with  Pasta LaBella  flavored
          pasta and increases in club store and private label sales.

               General   and   Administrative   Expense.      General   and
          administrative  expense increased $0.6 million, or 20.7%, to $3.5
          million for the  calendar year ended December 31,  1996 from $2.9
          million  for  the  fiscal  year  ended  December  31,  1995,  but
          decreased as  a percentage of revenues from 3.2% to 2.9% over the
          same period. The  increase in general and  administrative expense
          was primarily due  to increases in MIS expenses and communication
          costs  incurred to  support sales  growth and  the operations  in
          South Carolina.

               Operating Profit.  Operating profit decreased $1.6  million,
          or 18.2%,  to $7.2 million  for the calendar year  ended December
          31, 1996,  from $8.8 million  for the fiscal year  ended December
          31, 1995 and decreased as a percentage of revenue to 5.9% for the
          calendar year ended  December 31, 1996, from 9.4%  for the fiscal
          year ended  December  31, 1995.  Excluding  product  introduction
          costs, operating profit  increased by $8.0 million,  or 90.9%, to
          $16.8 million for the calendar year ended December 31, 1996, from
          $8.8  million for  the fiscal  year ended  December 31,  1995 and
          increased as  a percentage of  revenue to 13.8% for  the calendar
          year  ended December 31, 1996 from 9.4% for the fiscal year ended
          December 31, 1995.

               Interest Expense.  Interest  expense increased $2.6 million,
          or 32.5%  to $10.6 million  for the calendar year  ended December
          31, 1996 from $8.0 million for the fiscal year ended December 31,
          1995,  due to higher  debt levels resulting  from the incremental
          borrowings required to  finance the Company's South  Carolina and
          Missouri  capital   asset  expansion  and  increases  in  working
          capital.

               Income Tax.  Income tax  decreased to $(1.3) million for the
          calendar year ended  December 31, 1996 from $0.3  million for the
          fiscal year ended  December 31, 1995,  and reflects an  effective
          income tax rate of approximately 38% in both periods.

               Extraordinary Item.  During the calendar year ended December
          31,  1996, the  Company  incurred  a $1.6  million  (net of  tax)
          extraordinary loss due to the write-off of deferred debt issuance
          costs   in  conjunction   with  a   partial  extinguishment   and
          restructuring of the Company's principal bank credit agreement.

               Net Income.   Net  income decreased  $4.3 million to  $(3.8)
          million for the calendar year  ended December 31, 1996, from $0.5
          million for the fiscal year ended December 31, 1995.

          Liquidity and Capital Resources
          -------------------------------

               The Company's primary sources of liquidity are cash provided 
          by   operations  and   borrowings  under   its   existing  credit
          facilities.  The Company has generated liquidity through the sale
          of equity, which proceeds have historically been used  to finance
          capital expansions.  Cash and temporary  investments totaled $2.7
          million  and working capital  totaled $12.2 million  at September
          30, 1997.  At September  30, 1996, cash and temporary investments
          totaled  $1.8 million and working capital totaled $(1.6) million.
          The  $13.8 million increase in working capital resulted primarily
          from the  1997 Private Equity  Financing and improvements  in the
          Company s operating results.

               The  Company's net  cash  provided  by operating  activities
          totaled $23 million for the  fiscal year ended September 30, 1997
          compared to  a reduction of  net cash  of $(7.5) million  for the
          nine-month  fiscal period ended September 30, 1996. This increase
          of  $30.5  million  was  primarily  due  to  higher  net  income,
          reductions  in net working capital investment and reduced product
          introduction costs. Net cash provided by operating activities was
          $5.7  million  and  $3.7  million for  the  fiscal  years  ending
          December  31, 1995  and  1994,  respectively.  The  $2.0  million
          increase  in net  cash  provided by  operating activities  in the
          fiscal year ending  December 31, 1995 was primarily  due to lower
          investment in net working capital.

               Net cash provided  by financing activities was  $6.3 million
          for the  fiscal year ended  September 30, 1997 compared  to $12.3
          million  for the  nine-month fiscal  period  ended September  30,
          1996. The $6.3 million is primarily a result of (1) $22.0 million
          in net proceeds from the 1997 Private Equity Financing, (2) $11.7
          proceeds from  issuance  of  debt,  (net of  $2.1  deferred  debt
          issuance costs) partially  offset by the $25.3  million repayment
          of  short-term and  long-term borrowings.  Net  cash provided  by
          financing activities was $33.1 million for the fiscal year ending
          December 31, 1995, as a result of net borrowings required to fund
          the  Company's  capital  asset  expansion  programs  and  working
          capital. 

               In  April  1997, the  Company  entered into  an  amended and
          restated  credit agreement  with  Bankers Trust  Company,  Morgan
          Stanley Senior Funding, Inc. and various banks named therein (the
          "Credit Agreement").  The Credit  Agreement provided  for (i)  an
          $18.0 million term  loan to mature on  February 26, 2000; (ii)  a
          $19.9  million term loan to mature  on February 26, 2002; (iii) a
          $54.7 million term loan  to mature on  February 27, 2004; (iv)  a
          $45.0 million term loan to mature on February 27, 2004 to finance
          a  portion of the  Company's 1997-1998 capital  assets expansion;
          and (v) a $25.0 million revolving  loan to mature on February 29,
          2000. At September 30, 1997, $93.9 million was  outstanding under
          the Credit Agreement, and the Company had $45.0 million available
          to borrow under the $45.0  million term credit facility and $17.0
          million available  to borrow  under the  $25.0 million  revolving
          credit facility (subject to borrowing base limitations). Interest
          on  borrowings was  based  on  the  London Interbank  Offer  Rate
          (LIBOR), plus  a credit margin  of 300  to 375  basis points.  At
          September 30, 1997, the three-month  LIBOR rate was 5.7%, and the
          Company's aggregate, weighted  average bank  debt borrowing  rate
          was 9.1%.  The Credit  Agreement contained restrictive  covenants 
          that, among other things, limited  the Company's ability to incur
          debt, sell assets, make capital expenditures and pay dividends.

               After the close of the fiscal year end, the Company used the
          net proceeds from the Offering to repay outstanding indebtedness,
          a portion  of which  related to  the capital  expansion, incurred
          under  the  Company's  Credit Facility.  The  Company  intends to
          finance the  remainder of its capital expansion  program and fund
          future working capital needs with borrowings under the new Credit
          Agreement (the  "New Credit  Agreement") which  was completed  on
          October  17, 1997.  The  Company s restructured  credit  facility
          provides the Company with $150 million in credit on an unsecured,
          revolving basis  at interest rates  which are expected to  be 250
          basis points lower than the previous agreement.

               Interest is to be charged at either the base rate (higher of
          prime of   of  1% in excess of the federal  funds effective rate)
          or LIBOR plus  an applicable margin based  on a sliding  scale of
          the ratio of the Company s total indebtedness divided by earnings
          before interest, taxes,  depreciation and amortization  (EBITDA).
          In addition,  a commitment fee  is to  be charged  on the  unused
          facility  balance based  on the  sliding  scale of  the Company's
          total  indebtedness divided by  EBITDA. The stated  interest plus
          the commitment fee will be classified as interest expense.

               The Company  anticipates a first quarter  1998 extraordinary
          charge of approximately $2.3 million (net of tax), related to the
          write off of current and deferred debt issuance costs.
           
               The New  Credit  Agreement  contains  restrictive  covenants
          which include, among other  things, financial covenants requiring
          minimum and  cumulative earnings  levels and  limitations on  the
          payment of dividends,  stock purchases and the  Company's ability
          to enter into  certain contractual arrangements.  Management does
          not expect  these limitations  to have a  material effect  on the
          Company's business  or results of  operations. The Company  is in
          compliance  with all  financial covenants  contained  in the  new
          Credit Agreement.

               Cash flow  used in investing activities  principally relates
          to  the  Company's  investments  in manufacturing,  distribution,
          milling and  Management Information Systems(MIS)  assets. Capital
          expenditures  were  $28.4  million  for  the  fiscal  year  ended
          September 30,  1997 and  3.0  million for  the nine-month  period
          ended September  30, 1996 and  were $38.8 million for  the fiscal
          year  ended  December  31, 1995,  respectively.  The  increase in
          spending  for the  fiscal year  ending September  30, 1997  was a
          result of the Company's initial expenditures of $23.7  million of
          the  $86.0  million capital  expansion  program  discussed above,
          which  the  Company  expects  to  complete  by  April  1998.  The
          increased spending in  1994 and 1995 was primarily  the result of
          the construction  of the  Company's South  Carolina manufacturing
          and distribution facilities and Missouri distribution center.

               The  Company   currently   uses   cash   to   fund   capital
          expenditures,   repayments   of   debt    and   working   capital
          requirements. The Company expects  that future cash  requirements 
          will  principally be  for  capital  expenditures,  repayments  of
          indebtedness  under  the  Credit  Agreement  and working  capital
          requirements.

               The  Company  has committed  to  spend $15  million  for raw
          material purchases for fiscal year 1998 and has approximately $63
          million remaining of the $86 million capital expenditure program,
          which the  Company anticipates  will be funded  by the  middle of
          fiscal year 1998. The  Company expects to fund these  commitments
          from operations and borrowings under the current revolving credit
          facility. The current credit facility has scheduled reductions in
          the amount  of the commitment beginning at the end of fiscal year
          1999.  At this time, the borrowings outstanding under the current
          credit facility (assuming  the full $63  million is funded  under
          the  facility) do not  exceed the facility's  minimum commitment.
          The facility matures at the end of fiscal year 2002.  The Company
          anticipates that  any borrowing outstanding at that  time will be
          satisfied with funds from  operations or will be refinanced.  The
          Company currently has no other material commitments.

               Management  believes  that net  cash  provided  by operating
          activities, net cash provided by financing activities and the net
          proceeds  from  the Offering  will  be  sufficient  to  meet  the
          Company's   expected  capital   and  liquidity   needs  for   the
          foreseeable future.

          Other Matters
          -------------

               Recently Issued Accounting Standards. In February  1997, the
          Financial  Accounting  Standards  Board   issued  SFAS  No.  128,
          "Earnings  Per Share,"  which is  required to  be adopted  by the
          Company in its first quarterly period ended on December 31, 1997.
          At that time, the Company  will be required to change  the method
          currently used to  compute earnings per share and  to restate all
          prior periods.  SFAS No. 128  replaced primary and  fully diluted
          earnings per  share with  basic and  diluted earnings  per share.
          Under  the new requirements  for calculating earnings  per share,
          the dilutive effect of stock  options will be excluded from basic
          earnings per  share but  included in the  computation of  diluted
          earnings per share.  If SFAS No. 128 had been  implemented by the
          Company at September  30, 1997, the impact on  the calculation of
          earnings per share would not have been material.

          Effect of Inflation
          -------------------

               During the last three fiscal periods, inflation has  not had
          a material effect on the Company, other than to increase its cost
          of borrowing and  raw materials. In general, however, the Company
          has been able  to increase the majority of  customer sales prices
          to  recover significant  raw  material  cost increases.  However,
          changes  in  prices  of  the  Company's  pasta  products  and the
          pass-through of  higher durum  wheat costs  to certain  customers
          historically have  lagged price  increases in  the Company's  raw
          material costs.  

          ITEM 7A.  QUANTITATIVE AND  QUALITATIVE DISCLOSURES  ABOUT MARKET
                    RISK.

                    Not applicable.
          <PAGE> 

          ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                            AMERICAN ITALIAN PASTA COMPANY

                        Index to Audited Financial Statements

                                                                        PAGE
                                                                        ----

          Report of Independent Auditors                                  35

          Balance Sheets at September 30, 1996 and  1997                  36

          Statements of Operations for the year ended December
           31, 1995, the fiscal nine-months ended September 30,
           1996,  and the year ended September 30, 1997                   37

          Statements of Stockholders' Equity for the year ended
            December 31, 1995, the fiscal nine-months ended
            September 30,  1996 and the  year ended September 30, 1997    38

          Statements of Cash Flows for the year ended December 31,
           1995, the fiscal nine-months ended September 30, 1996
           and the year ended September 30, 1997                          39

          Notes to Financial Statements                                   40

          <PAGE> 

                            REPORT OF INDEPENDENT AUDITORS

          The Board of Directors
          American Italian Pasta Company

               We  have audited the accompanying balance sheets of American
          Italian Pasta Company (the Company) as of  September 30, 1996 and
          1997,  and the  related statements  of  operations, stockholders'
          equity and cash  flows for the year ended  December 31, 1995, the
          nine-month  fiscal period ended  September 30, 1996 and  the year
          ended  September 30, 1997.  These  financial statements  are  the
          responsibility of  the Company's management.   Our responsibility
          is to express  an opinion on these 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 financial statements referred  to above
          present  fairly, in all material respects, the financial position
          of American Italian Pasta Company at September 30, 1996 and 1997,
          and the results of its operations and its cash flows for the year
          ended  December 31,  1995,  the  nine-month  fiscal  period ended
          September 30,  1996  and  the year  ended  September 30,  1997 in
          conformity with generally accepted accounting principles.

                                                  /S/ ERNST & YOUNG LLP

          Kansas City, Missouri
          October 27, 1997

          <PAGE> 

          <TABLE>
          <CAPTION>
                            AMERICAN ITALIAN PASTA COMPANY

                                    BALANCE SHEETS


                                                 SEPTEMBER         SEPTEMBER 
                                                 30, 1996          30, 1997
                                                 ---------         ---------
                                                       (In thousands)
          <S>                                   <C>                <C>
          ASSETS (Note 2)

          Current assets:
            Cash and temporary investments        $  1,818         $  2,724

            Trade and other receivables             12,494            9,180

            Prepaid expenses and deposits            1,879            1,028
            Inventory                               14,374           13,675
            Deferred income taxes (Note 3)             269              635
                                                  --------         --------
          Total current assets                      30,834           27,242

           
          Property, plant and equipment:
            Land and improvements                    4,413            4,540

            Buildings                               37,491           37,491

            Plant and mill equipment                81,461           84,233

            Furniture, fixtures and equipment        3,635            4,581
                                                  --------         --------
                                                   127,000          130,845
            Accumulated  depreciation              (23,247)         (29,332)
                                                  --------         --------
                                                   103,753          101,513
            Construction in progress                    --           23,721
                                                  --------         --------
          Total property, plant and equipment      103,753          125,234

          Deferred income taxes (Note 3)             4,479            1,124

          Other assets                               2,622            4,575
                                                  --------         --------
          Total assets                            $141,688         $158,175
                                                  ========         ========

          LIABILITIES AND STOCKHOLDERS' EQUITY

          Current liabilities:       
            Accounts payable                      $  7,193         $  8,644
            Accrued expenses                         3,664            5,581
            Current maturities of long-term
              debt (Notes 2 & 12)                    8,078              829
            Revolving line of credit facility
             (Notes 2 & 12)                         13,500               --
                                                  --------         --------
          Total current liabilities                 32,435           15,054
          Long-term debt (Notes 2 & 12)             93,284          100,137
          Commitments and contingencies (Note 4)
          Stockholders' equity: (Notes 6, 11 & 12)
            Preferred stock, $.001 par value:  
              Authorized shares 10,000,000              --               --
            Class A common stock, $.001 par value:
              Authorized shares   75,000,000             8               11
            Class B common stock, $.001 par value:
              Authorized shares   25,000,000            --               --
            Additional paid-in capital              33,071           55,324

            Notes receivable from officers              --             (298)
            Accumulated  deficit                   (17,110)         (12,053)
                                                  --------         --------
          Total stockholders' equity                15,969           42,984
          Total liabilities and stockholders'
            equity                                $141,688         $158,175
                                                  ========         ========   
          </TABLE>           
                   See accompanying notes to financial statements. 
          <PAGE>
          <TABLE>
          <CAPTION>
                                        AMERICAN ITALIAN PASTA COMPANY

                                            STATEMENT OF OPERATIONS

                                                               NINE        TWELVE       
                                                   YEAR        MONTHS      MONTHS       YEAR
                                                   ENDED       ENDED       ENDED        ENDED
                                                   DECEMBER    SEPTEMBER   SEPTEMBER    SEPTEMBER
                                                   31, 1995    30, 1996    30, 1996     30, 1997
                                                   --------    ---------   ---------    ---------
                                                                           (Unaudited)
                                                     (In thousands, except per share amounts)

     <S>                                           <C>         <C>         <C>         <C>

     Revenues (Note 5)                             $92,903     $92,074     $121,149     $129,143
     Cost of goods sold                             73,851      68,555       91,230       93,467
     Plant expansion costs (Note 8)                  2,065          --           --           --
                                                   -------     -------      -------      -------
     Gross profit                                   16,987      23,519       29,919       35,676
     Selling and marketing expense,
       including product introduction
       costs (Note 10)                               5,303      16,798       18,445       13,664
     General and administrative expense              2,930       2,805        3,686        3,766
                                                   -------     -------      -------      -------
     Operating profit                                8,754       3,916        7,788       18,246
     Interest expense, net                           8,008       8,023       10,770       10,119
                                                   -------     -------      -------      -------
     Income (loss) before income tax expense
       (benefit) and extraordinary item                746      (4,107)      (2,982)       8,127
     Income tax expense (benefit) (Note 3)             270      (1,556)      (1,139)       3,070
                                                   -------     -------      -------      -------
     Income (loss) before extraordinary item           476      (2,551)      (1,843)       5,057
     Extraordinary item:
       Loss due to early extinguishment of
       long-term debt, net of income taxes
       (Note 2)                                         --      (1,647)      (1,647)          --
                                                   -------     -------      -------      -------
     Net income (loss)                             $   476     $(4,198)     $(3,490)     $ 5,057
                                                   =======     =======      =======      =======  
     Net income (loss) per common share:
     Before extraordinary item                     $  0.05     $ (0.24)     $ (0.17)     $  0.42
     Extraordinary item                                 --       (0.16)       (0.16)     $    --
                                                   -------     -------      -------      -------
     Total                                         $  0.05     $ (0.40)     $ (0.33)     $  0.42
                                                   =======     =======      ======= 

     Weighted-average common shares outstanding     10,445      10,473       10,470       12,161
                                                   =======     =======      =======  
     </TABLE>
                                See accompanying notes to financial statements. 

     <PAGE>
     <TABLE>
     <CAPTION>
                                        AMERICAN ITALIAN PASTA COMPANY

                                      STATEMENTS OF STOCKHOLDERS' EQUITY

                                                                        NOTES
                                                                        RECEIV-                 TOTAL
                                       CLASS A    CLASS A   ADDITIONAL  ABLE                    STOCK-
                                       COMMON     COMMON    PAID-IN     FROM       ACCUMULATED  HOLDERS'
                                       SHARES     STOCK     CAPITAL     OFFICERS   DEFICIT      EQUITY
                                       -------    -------   ----------  --------   -----------  -------
                                                       (In thousands, except share data)


     <S>                              <C>         <C>      <C>          <C>        <C>         <C>

     Balance at December 31, 1994     8,201,233   $   8     $32,781     $   --     $(13,388)    $19,401
        Issuance of 38,767 shares 
          of Class A Common stock        38,767      --         190         --           --         190
        Net income                           --      --          --         --          476         476
                                     ----------    ----     -------      -----     --------     -------
     Balance at December 31, 1995     8,240,000       8      32,971         --      (12,912)     20,067  
        Issuance of 20,328 shares of
          Class A Common stock           20,328      --         100         --           --         100
        Net loss                             --      --          --         --       (4,198)     (4,198)
                                     ----------    ----      -------      -----      --------     -------
     Balance at September 30, 1996    8,260,328       8      33,071         --      (17,110)     15,969
       Issuance of 3,174,526 shares
         of Class A Common Stock, net
         of issuance costs            3,174,528       3      22,039         --           --      22,042
       Notes received from officers
         in exchange for stock               --      --          --       (298)          --        (298)
       Issuance of 31, 200 shares of
         Class A Common Stock to
         employee benefit plan           31,200      --         214         --           --         214
       Net income                            --      --          --         --        5,057       5,057
                                     ----------    ----     -------      -----     --------     -------
     Balance at September 30, 1997   11,466,056  $   11     $55,324     $ (298)   $ (12,053)    $42,984
                                     ==========  ======     =======     ======    =========   
     </TABLE> 

                                 See accompanying notes to financial statements.
     <PAGE> 
     <TABLE>
     <CAPTION>

                                        AMERICAN ITALIAN PASTA COMPANY

                                           STATEMENTS OF CASH FLOWS

                                                                            NINE
                                                           YEAR             MONTHS           YEAR
                                                           ENDED            ENDED            ENDED
                                                           DEC-             SEPT-            SEPT-
                                                           EMBER 31,        EMBER 30,        EMBER 30, 
                                                           1995             1996             1997
                                                           ---------        ---------        ---------
                                                                          (In thousands)

          <S>                                              <C>              <C>              <C>

          Operating activities:                            
          Net income (loss)                                 $   476          $(4,198)         $ 5,057
          Adjustments to reconcile net income
            (loss) to net cash provided by (used in)
            operations:
              Depreciation and amortization                   6,279            5,434            7,828
              Deferred income tax expense
                (benefit)                                       264           (1,556)           2,989
              Extraordinary loss due to early
                 extinguishment of long-term debt                --            1,647               --
              Loss on disposal of property, plant and
                equipment                                       439               --               --
              Changes in operating assets and
                liabilities
                  Trade and other receivables                (4,586)          (1,785)           3,347
                  Prepaid expenses and deposits                (364)            (952)             464
                  Inventory                                  (2,814)          (1,830)           1,086
                  Accounts  payable and accrued expenses      6,610           (3,961)           2,792
                  Other                                        (574)            (276)            (492)
                                                           --------         --------          -------
          --  Net cash provided by (used in) operating
            activities                                        5,730           (7,477)          23,071
          Investing activities:
          Additions to property, plant and equipment
                                                            (38,789)          (3,041)         (28,428)
                                                           --------         --------          -------
          --  Net cash used in investing activities         (38,789)          (3,041)         (28,428)
          Financing activities:                                                                     

          Additions to deferred debt issuance costs             (71)          (2,083)          (2,115)
          Proceeds from issuance of  debt                    40,795           86,470           11,730
          Net borrowings under revolving line of
            credit facility                                      --           13,500           (5,500)
          Principal payments on debt and
            capital lease obligations                        (7,848)         (85,669)         (19,810)

          Proceeds from issuance of common
            stock, net of issuance costs                        190              100           21,958
                                                           --------         ---------         ------- 
          Net cash provided by financing activities          33,066           12,318            6,263
                                                           --------         ---------         ------- 
          Net increase in cash and temporary
            investments                                           7            1,800              906
          Cash and temporary investments at
            beginning of period                                  11               18            1,818
                                                           --------         ---------         -------
          Cash and temporary investments at
            end of period                                  $     18         $  1,818          $ 2,724
                                                           ========         ========          ======= 
          </TABLE>

                                See accompanying notes to financial statements. 
          <PAGE>

                            AMERICAN ITALIAN PASTA COMPANY

                            NOTES TO FINANCIAL STATEMENTS
                                  SEPTEMBER 30, 1997

          1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          NATURE OF BUSINESS

               American Italian Pasta  Company (the Company) is  a Delaware
          Corporation which began  operations in 1988.  The  Company is the
          third  largest producer  and  marketer of  pasta products  in the
          United  States  with  manufacturing and  distribution  facilities
          located  in  Excelsior  Springs,  Missouri  and  Columbia,  South
          Carolina.

          CHANGE IN FISCAL YEAR

               Effective for its 1996 fiscal  year, the Company changed its
          fiscal year end from December 31  to the last Friday of September
          or  the first  Friday  of October.    This change  resulted in  a
          nine-month  fiscal period  for 1996,  a  53-week year  for fiscal
          1997, and  a 52- or 53-week year for all subsequent fiscal years.
          The  Company's  other fiscal  quarters  end  on the  Friday  last
          preceding December 31, March 31  and June 30 or the  first Friday
          of  the following month  of each  quarter.   For purposes  of the
          financial statements and notes  thereto, the 1997 fiscal year  is
          described as having ended on September 30, 1997.

          UNAUDITED FINANCIAL INFORMATION

               The Company has  included information for the  twelve months
          ended  September 30,  1996 in  the statements  of operations  for
          comparative purposes.  This information is unaudited.

          REVENUE RECOGNITION

               Sales of  the Company's  products, including  pricing terms,
          are final  upon shipment of  the goods.  Accordingly,  revenue is
          recognized at such time.

          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  amounts reported
          in  the  financial  statements and  accompanying  notes.   Actual
          results could differ from those estimates.

          RISKS AND UNCERTAINTIES

               The Company grants credit to certain customers  who meet the
          Company's pre-established  credit requirements.   Generally,  the
          Company does not require collateral security when trade credit is
          granted  to customers.   Credit  losses are  provided for  in the
          financial   statements   and   consistently   have  been   within
          management's expectations.  The  allowance for doubtful  accounts 
          at   September 30,  1996  and  1997  was  $60,000  and  $196,000,
          respectively.   At September 30, 1996 and 1997, approximately 34%
          and  37%, respectively, of accounts receivable  were due from two
          customers.

               Pasta is made from semolina milled from durum wheat, a class
          of hard  amber wheat  grown in  certain parts  of  the world  and
          purchased by the Company from United States and Canadian sources.
          The  Company  mills  the wheat  into  semolina  at  its Excelsior
          Springs  plant.   Durum wheat  is  a narrowly  traded, cash  only
          commodity crop.   The Company attempts to minimize  the effect of
          durum wheat cost fluctuations  through forward purchase contracts
          and raw material  cost-based pricing agreements with many  of its
          customers.    The  Company's  commodity procurement  and  pricing
          practices are  intended to  reduce the risk  of durum  wheat cost
          increases on profitability,  but also may temporarily  affect the
          timing of the  Company's ability to  benefit from possible  durum
          wheat cost decreases for such contracted quantities.

          FINANCIAL INSTRUMENTS

               The carrying value of  the Company's financial  instruments,
          including cash  and temporary  investments, accounts  receivable,
          accounts  payable  and   long-term  debt,  as  reported   in  the
          accompanying  balance sheet  at September 30,  1997, approximates
          fair value.

          ADVERTISING COSTS

               The Company amortizes direct response advertising costs over
          the period in  which the future benefits are  expected (generally
          six months or  less).  Other costs of  advertising and promotions
          are expensed as incurred.

          CASH AND TEMPORARY INVESTMENTS

               Cash and temporary investments include cash on hand, amounts
          due  from  banks  and highly  liquid  marketable  securities with
          maturities of three months or less at the date of purchase. 

          INVENTORIES

               Inventories are stated using product specific standard costs
          which approximate  the lower  of cost or  market determined  on a
          first-in, first-out  (FIFO) basis.   Inventories  consist of  the
          following:

          <TABLE>
          <CAPTION>

                                             SEPTEMBER 30,      SEPTEMBER 30,
                                                 1996               1997
                                             -------------      ------------
                                                     (In thousands)

          <S>                                   <C>                <C>

          Finished goods                        $10,809            $ 9,310
          Raw materials, packaging
            materials and work-in process         3,565              4,365
                                                -------            -------
                                                $14,374            $13,675
                                                =======            =======
          </TABLE>

          PROPERTY, PLANT AND EQUIPMENT

               Capital  additions,  improvements  and  major  renewals  are
          classified  as property, plant and  equipment and are recorded at
          cost.    Depreciation  is   calculated  for  financial  statement
          purposes using the straight-line method over the estimated useful
          life of the related asset for each year as follows:

                                                      NUMBER OF     
                                                        YEARS
                                                      ---------

               Land improvements                       40
               Buildings                               30
               Plant and mill equipment                20
               Packaging equipment                     10
               Furniture, fixtures and equipment        5

               The Company  capitalizes interest costs associated  with the
          construction and installation of plant and equipment.  During the
          fiscal year ended December 31, 1995,  approximately $1,559,000 of
          interest cost  was  capitalized.   There  was  no  interest  cost
          capitalized in fiscal 1996.   During the year ended September 30,
          1997, approximately $488,000 of interest cost was capitalized.

          <PAGE>

          OTHER ASSETS

               Other assets consist of the following:

          <TABLE>
          <CAPTION>

                                              SEPTEMBER  30,   SEPTEMBER 30,
                                                  1996             1997
                                              ------------     ------------
                                                      (In thousands)

          <S>                                 <C>               <C>

          Debt issuance costs (Note 2)        $  2,143          $  4,258  
          Package design costs                   1,456             1,598  
          Other                                  1,150             1,702  
                                              --------          --------
                                                 4,749             7,558  
          Accumulated amortization              (2,127)           (2,983)
                                              --------          --------
                                              $  2,622          $  4,575
                                              ========          ========

          </TABLE>

               Debt  issuance  costs  relate to  expenditures  incurred  in
          connection with obtaining  long-term debt.  These costs are being
          amortized over the  life of the related debt  using the effective
          interest  rate method.   Debt issuance costs,  net of accumulated
          amortization, were $3,436,000 at September 30, 1997.

               Package design  costs  relate to  certain incremental  third
          party  costs  to  design  artwork  and  produce  die  plates  and
          negatives necessary to manufacture and print packaging  materials
          according to the  Company's and customer's specification.   These
          costs are amortized ratably over a two-year period.  In the event
          that product  packaging is discontinued  prior to the end  of the
          amortization  period,  the  respective package  design  costs are
          written   off.    Package   design  costs,  net   of  accumulated
          amortization, were $378,000 at September 30, 1997.

          INCOME TAXES

               The Company accounts for income taxes in accordance with the
          method prescribed  by Statement of Financial Accounting Standards
          (SFAS) No. 109, "Accounting for Income Taxes." Under this method,
          deferred  tax  assets  and liabilities  are  determined  based on
          differences  between the  financial reporting  and  tax bases  of
          assets and  liabilities, and are  measured using the  enacted tax
          rates and laws that  will be in  effect when the differences  are
          expected to reverse. 

          STOCK OPTIONS

               The  Company has  elected  to  follow Accounting  Principles
          Board  Opinion  (APB)  No. 25, "Accounting  for  Stock  Issued to
          Employees,"  and related  Interpretations in  accounting for  its
          employee stock options and have  adopted the pro forma disclosure
          requirements  under  SFAS  No. 123  "Accounting  for  Stock-Based
          Compensation."  Under APB No. 25,  because the exercise  price of
          the Company's employee stock options  is equal to or greater than
          the market price of the underlying stock on the date of grant, no
          compensation expense is recognized.

          NET INCOME (LOSS) PER COMMON SHARE

               Net income (loss)  per common share is  calculated using the
          weighted-average  number of common  shares and  common equivalent
          shares, to the  extent dilutive, outstanding during  the periods.
          Pursuant to  Securities and Exchange  Commission Staff Accounting
          Bulletin No. 83, stock issued and common stock options granted by
          the  Company  during the  12  months preceding  the  October 1997
          filing date for its initial public offering have been included in
          the calculation  of weighted-average common and common equivalent
          shares outstanding, using  the treasury stock method based on the
          initial  public offering price of $18 per  share, as if the stock
          and options were outstanding for all periods presented.

               Supplementary  net income  per  share  for  the  year  ended
          September  30, 1997  is $0.57  calculated to  give effect  to the
          reduction of interest expense, net of tax and the increase in the
          weighted  average number of  common and common  equivalent shares
          outstanding sufficient to  retire certain indebtedness as  if the
          retirement had occurred at the beginning of the period affected.

          2.  LONG-TERM DEBT

             The  Company  refinanced  certain  of  its  credit  facilities
          subsequent to September 30, 1997  as more fully described in Note
          12.

               The  principal  maturity  terms  of  the  new  $150  million
          unsecured, revolving credit facility are as follows:

          <TABLE>
          <CAPTION>

                                                       SCHEDULED COMMITMENT
                     FACILITY               AMOUNT           REDUCTION
                     --------               ------     --------------------
                                        (In thousands)

          <S>                               <C>        <C>

          Scheduled Commitment Reduction    $ 10,000   September 30, 1999
          Scheduled Commitment Reduction      15,000   September 30, 2000
          Scheduled Commitment Reduction      25,000   September 30, 2001
          Final Maturity                     100,000   September 30, 2002
                                            -------- 

                                            $150,000
                                            ========

          </TABLE>

               Interest is to be charged at either the base rate (higher of
          prime or   of  1% in excess of the federal  funds effective rate)
          or LIBOR plus  an applicable margin based  on a sliding scale  of
          the ratio of the Company's total indebtedness divided by earnings
          before interest, taxes,  depreciation and amortization  (EBITDA).
          In addition,  a commitment  fee is  to be charged  on the  unused
          facility  balance based  on the  sliding  scale of  the Company's
          total  indebtedness divided by EBITDA.   The stated interest plus
          the commitment fee will be classified as interest expense.

               Long-term debt,  as reclassified to reflect  the refinancing
          events described above, consists of the following:

          <TABLE>
          <CAPTION>

                                              SEPTEMBER  30,    SEPTEMBER 30,
                                                  1996             1997    
                                              ------------     -------------
                                                      (In thousands)

          <S>                                   <C>             <C>

          Term loans                            $ 94,813        $ 93,938
          Capital lease, 15-year term 
            with three,  five-year renewal
            options, at an imputed interest
            rate of 12.5%                          3,586           3,482
          Capital lease, eight-year term at
            an imputed interest rate of 8.5%       2,260           2,054
          Other                                      703           1,492
                                                --------        --------
                                                 101,362         100,966
          Less current portion                     8,078             829
                                                 -------         -------
                                                $ 93,284        $100,137
                                                ========        ========
          </TABLE>

               In  February 1996,  the Company  refinanced  certain of  its
          credit  facilities.   The unamortized  balance  of debt  issuance
          costs of  $2.6 million  which related to  the previous  debt were
          written off,  net of related  tax benefits  of $1 million,  as an
          extraordinary  loss   on  debt  extinguishment   as  required  by
          generally accepted accounting principles. 

               The  following  information  related  to the  old  revolving
          credit  facility is  presented  for the  year ended  December 31, 
          1995, the nine-month  fiscal period ended September 30,  1996 and
          the year ended September 30, 1997.

                                                1995    1996    1997
                                                ----    ----    ----
           
          Weighted-average interest rate        9.0%    8.4%    8.5%

               Annual  maturities  of  long-term  debt  and  capital  lease
          obligations for each  of the next five  years ended September 30,
          including the principal amortization provisions of the refinanced
          credit agreement, are as follows:

          <TABLE>
          <CAPTION>

                                       LONG TERM     CAPITAL LEASES    
          YEAR                            DEBT          AND OTHER       TOTAL
          ----                          --------     --------------     -----
                                                     (In thousands)

          <S>                           <C>              <C>           <C>

          1998                          $    --          $ 1,520
          1999                               --            1,496
          2000                               --            1,220
          2001                               --              994
          2002                           93,938              990
          Thereafter                         --            5,235
                                         ------          -------
                                         93,938           11,455        $105,393
          Less imputed interest              --            4,427           4,427
                                         ------          -------         -------
          Present value of net
            minimum payments             93,938            7,028         100,966
          Less current portion               --              829             829
                                        -------          -------         -------
          Long-term  obligations        $93,938          $ 6,199        $100,137
                                        =======          =======        ========

          </TABLE>

               The   new  revolving   credit   agreement  contain   various
          restrictive  covenants   which  include,   among  other   things,
          financial  covenants requiring  minimum  and cumulative  earnings 
          levels  and  limitations  on  the  payment  of  dividends,  stock
          purchases,  and the  Company's  ability  to  enter  into  certain
          contractual arrangements. The facility is unsecured.

               The  Company  leases  certain  assets  under  capital  lease
          agreements.   At September 30, 1996  and 1997, the cost  of these
          assets was $7,128,000  and $7,949,000, respectively, and  related
          accumulated amortization was $642,000 and $687,000, respectively.

          3.  INCOME TAXES

               At September  30, 1997, the  Company has net  operating loss
          carryforwards  for federal  income tax  purposes  that expire  as
          follows:

                    2003                               $   958
                    2004                                 5,253
                    2005                                    76
                    2006                                     5
                    2007                                 1,299
                    2008                                   195
                    2009                                 1,248
                    2010                                 5,121
                    2011                                12,584
                    2012                                    58
                                                        ------
                                                       $26,797
                                                       =======

               The Company also has state income enterprise zone credits of
          approximately $1 million that expire in 1997.

               The  Company  has  established   a  valuation  allowance  of
          approximately $1 million  for state enterprise zone  credits that
          are available  but are not  expected to be realized.   Management
          believes it is  more likely than not that  remaining deferred tax
          assets will be realized through  the generation of future taxable
          income and available tax planning strategies.

               Deferred  income  taxes  reflect  the  net  tax  effects  of
          temporary  differences between the carrying amounts of assets and
          liabilities for financial reporting purposes and the amounts used
          for income tax purposes.  Significant components of the Company's
          deferred tax assets and liabilities are as follows:

          <TABLE>
          <CAPTION>

                                              SEPTEMBER  30,    SEPTEMBER 30,
                                                  1996             1997
                                              ------------     -------------
                                                      (In thousands)

          <S>                                  <C>              <C> 

          Deferred tax assets:           
            Net operating loss carryforward     $  9,730        $ 10,183
            State enterprise zone credits          1,031           1,031
            AMT credit carryforward                  561             676
            Other                                  1,888             732
                                                --------        --------
          Total deferred tax assets               13,210          12,622
          Deferred tax liabilities:
            Book basis of tangible assets
              greater than tax                     6,721           9,404
            Other                                    710             428
                                                --------        --------
          Total deferred tax liabilities           7,431           9,832
                                                --------        --------
          Net deferred tax assets before
            allowance                              5,779           2,790
          Valuation allowance for deferred
            tax assets                            (1,031)         (1,031)
                                                --------        --------
          Net deferred tax assets                $ 4,748         $ 1,759
                                                ========        ========
          </TABLE> 

               Significant components of the provision for income taxes are
          as follows:

          <TABLE>
          <CAPTION>  
                                                        NINE     
                                           YEAR         MONTHS       YEAR
                                           ENDED        ENDED        ENDED
                                           DEC-         SEPT-        SEPT-
                                           EMBER        EMBER        EMBER
                                           31, 1995     30,1996      30, 1997
                                           --------     --------     --------
                                                     (In thousands)

          <S>                              <C>           <C>          <C>

          Current income tax expense        $    6        $    --      $    81
          Deferred tax  expense (benefit)      264         (1,556)       2,989
                                            ------        -------      -------
          Net income tax  expense (benefit) $  270        $(1,556)     $ 3,070
                                            ======        =======      =======
          </TABLE>                             

               The   reconciliation  of   income   tax   computed  at   the
          U.S. statutory tax rate to income tax expense is as follows:

          <TABLE>
          <CAPTION>  
                                                        NINE     
                                           YEAR         MONTHS       YEAR
                                           ENDED        ENDED        ENDED
                                           DEC-         SEPT-        SEPT-
                                           EMBER        EMBER        EMBER
                                           31, 1995     30,  1996    30, 1997
                                           --------     --------     ------
                                                     (In thousands)

          <S>                              <C>          <C>          <C>

          Income (loss) before income
           taxes                            $  746       $(4,107)     $8,127 
          U.S. statutory tax rate              x34%          x34%        x34%
                                           --------     --------      ------
          Federal income tax expense
           (benefit) at U.S. statutory 
            rate                               254        (1,396)     2,763
          State income tax expense
           (benefit),  net of federal
           tax effect                           30          (165)       325
          Other, net                           (14)            5        (18)
                                           -------       -------     ------
          Net income tax expense
            (benefit)                       $  270       $(1,556)    $3,070 
                                           =======       =======     ======
          </TABLE>

          4.  COMMITMENTS AND CONTINGENCIES

               In April 1997,  the Company entered into a  long-term supply
          arrangement in which the Company  is obligated to produce and the
          customer  is obligated to purchase certain minimum annual volumes
          of pasta products beginning in fiscal  1998.  In order to fulfill
          its obligations under the contract, the Company will be  required
          to expand significantly its available production capacity.

               The  Company has  committed  approximately  $86  million  to
          expand significantly  its  existing  manufacturing,  milling  and
          distribution facilities.  The expansion assets are anticipated to
          be placed  in service  during fiscal 1998.   As  of September 30,
          1997,   cumulative   expansion  expenditures   are   $23,721,000,
          including  capitalized  interest  of  $488,000.    The  remaining
          expansion costs  will be  funded from a  portion of  the proceeds
          from the  Company's common  stock sale  (see Note 12),  available
          bank credit facilities and cash provided by operations.

               The Company  had durum wheat  purchase commitments  totaling
          approximately  $8.0 million  and $15.1  million at  September 30,
          1996 and 1997, respectively.

               Under  an agreement with  its predominant rail  carrier, the
          Company is obligated  to transport specified  wheat volumes.   In
          the event the specified  transportation volumes are not met,  the
          Company is required to reimburse certain rail carrier costs.  The
          Company  is  in   compliance  with  the  volume   obligations  at
          September 30, 1997.

          5.  MAJOR CUSTOMERS

               Sales   to  a  certain   customer  during  the   year  ended
          December 31,  1995,  the fiscal  nine-months  ended September 30,
          1996 and the year  ended September 30, 1997 represented 33%,  27%
          and 27%  of revenues, respectively.   Sales to a  second customer
          during the year  ended December 31, 1995, the  fiscal nine-months
          ended  September 30, 1996 and  the year ended  September 30, 1997 
          represented 23%, 19% and 22% of revenues, respectively.

          6.  STOCK OPTION PLAN

               In October 1992,  a stock option  plan was established  that
          authorizes the  granting of options  to purchase up  to 1,201,880
          shares of the Company's common  stock by certain officers and key
          employees.   In October 1993, an additional  plan was established
          that authorizes the granting of  options to purchase up to 82,783
          shares of the  Company's common stock.  The  stock options expire
          10 years from  the date of grant and  become exercisable over the
          next five  years in varying amounts depending on the terms of the
          individual option agreements.

          <TABLE>
          <CAPTION>

                                                               WEIGHTED
                                NUMBER                          AVERAGE
                                  OF         OPTION PRICE      EXERCISE
                                SHARES        PER SHARE          PRICE       EXERCISABLE
                               ---------     -------------      --------     -----------

          <S>                  <C>           <C>                <C>          <C>

          Outstanding at 
           December 31, 1994     673,433      $2.33-$4.92        $ 4.06       374,447
           Exercised                  --
           Granted               339,562         $12.23          $12.23
           Canceled/Expired           --
                              ----------
          Outstanding at 
           December 31, 1995  1,012,995       $2.33-$12.23       $ 6.79       455,942
             Exercised              --
             Granted              1,226       $12.23             $12.23     
          Canceled/Expired         (613)      $12.23             $12.23
                              ---------
          Outstanding at 
           September 30, 1996 1,013,608       $2.33-$12.23       $ 6.80       541,471
            Exercised                --
            Granted             262,052       $7.02-$12.23       $ 8.87
          Canceled/Expired      (96,334)      $4.92-$12.23       $12.09
                              ---------
          Outstanding at 
           September 30, 1997 1,179,326       $2.33-$12.23       $ 6.83       734,877
                              =========
          </TABLE> 

               The following  table summarizes outstanding  and exercisable
          options at September 30, 1997:

          <TABLE>
          <CAPTION>

                           OPTIONS OUTSTANDING    OPTIONS EXERCISABLE
                           -------------------    -------------------
                                      WEIGHTED                 WEIGHTED
                                      AVERAGE                  AVERAGE
          EXERCISE      NUMBER        EXERCISE    NUMBER       EXERCISE
          PRICES        OUTSTANDING   PRICE       EXERCISABLE  PRICE
          ---------     -----------   --------    -----------  --------

          <S>           <C>           <C>         <C>          <C>

          $2.33-$2.38   226,456       $ 2.36      226,456      $ 2.36
          $4.92         445,137         4.92      338,563        4.92
          $7.02         169,244         7.02       57,028        7.02
          $12.23        338,489        12.23      112,830       12.23

          </TABLE>

               SFAS No. 123 requires the disclosure of pro forma net income
          and earnings per  share for stock-based awards as  if the Company
          had used  the fair  value method of  accounting for  such awards.
          Under SFAS No. 123, the fair  value is calculated through the use
          of  option pricing  models.    These  models  require  subjective
          assumptions, including future stock price volatility and expected
          time to  exercise, which  greatly affect  the calculated  values.
          The  Company's calculations  were made  using  the minimum  value
          method with the following  weighted-average assumptions: expected
          life, 18 months following vesting; no stock volatility; risk free
          interest rate  of 6% and  no dividends during the  expected term.
          Based  on these  calculations  and  assumptions,  the  effect  of
          applying  SFAS No. 123's  fair  value  method  to  the  Company's
          stock-based  awards  granted  subsequent  to  December  15,  1994
          results in pro forma net income which is not materially different
          from  amounts   reported  in  the   accompanying  statements   of
          operations.

          7.  EMPLOYEE BENEFIT PLAN

               The  Company has a defined contribution plan organized under
          Section   401(k)   of   the  Internal   Revenue   Code   covering
          substantially  all employees.   The  plan  allows all  qualifying
          employees to contribute up to the tax deferred contribution limit
          allowable  by the  Internal  Revenue Service.   The  Company will
          match 50% of the employee  contributions up to a maximum employee
          contribution of 6%  of the employee's  salary and may  contribute
          additional  amounts to  the plan  as determined  annually by  the
          Board of Directors.  Employer  contributions related to the  plan
          totaled  $139,000, $124,000  and  $200,000  for  the  year  ended
          December 31,  1995, the  fiscal  nine-months ended  September 30,
          1996 and the year ended September 30, 1997, respectively.

          8.  PLANT EXPANSION COSTS 

               Plant  expansion   costs  include  incremental   direct  and
          indirect manufacturing and distribution costs which  are incurred
          as a  result of construction,  commissioning and start-up  of new
          capital assets.   These  costs are expensed  as incurred  but are
          unrelated to  current production  and, therefore,  reported as  a
          separate  line  item  in  the statement  of  operations.    Plant
          expansion  costs  amounted  to  $2,065,000  for  the  year  ended
          December 31, 1995.

          9.  SUPPLEMENTAL CASH FLOW INFORMATION

          <TABLE>
          <CAPTION>  

                                                        NINE     
                                           YEAR         MONTHS       YEAR
                                           ENDED        ENDED        ENDED
                                           DEC-         SEPT-        SEPT-
                                           EMBER        EMBER        EMBER
                                           31, 1995     30, 1996     30, 1997
                                           --------     --------     --------
                                                     (In thousands)

          <S>                              <C>          <C>          <C>

          Supplemental disclosure of cash
            flow information:
            Cash paid for interest         $9,675       $8,101       $9,899
                                           ======       ======       ======

            Cash paid for income tax       $  100           50           --
                                           ======       ======       ======    

          </TABLE>

          10.  PRODUCT INTRODUCTION COSTS

               During 1996,  the Company  began distribution  of its  Pasta
          LaBella  flavored pasta products  into the United  States' retail
          grocery trade.   Introduction of these products  was supported by
          significant  advertising, promotions  and other  initiatives. The
          Company's  selling and marketing  expense includes  the following
          product introduction costs:

          <TABLE>
          <CAPTION>

                                                     NINE
                                                     MONTHS     YEAR
                                                     ENDED      ENDED
                                                     SEPT-      SEPT-
                                                     EMBER      EMBER
                                                     30, 1996   30, 1997
                                                     --------   --------
                                                       (In thousands) 

          <S>                                        <C>        <C>
                                         
          Introductory advertising                   $3,587     $  137
          In-store product demonstrations               692        307
          Direct response advertising amortization      166        200
          Product placement fees paid                 3,113      1,633
          Introductory trade incentives                 268         --
          Other                                         296        588
                                                     ------     ------
          Total product introduction costs           $8,122     $2,865
                                                     ======     ====== 
          There were no such costs in 1995.

          </TABLE>

          11.  NOTES RECEIVABLE FROM OFFICERS

               In  April 1997,  certain officers  of  the Company  acquired
          42,366  shares of  common stock.  At the  same time,  the Company
          loaned  these officers $298,000, all of which remains outstanding
          at September 30,  1997.    The  loans  which  were  evidenced  by
          promissory notes  are payable  in equal  installments over  three
          years   commencing   upon   termination   of   certain   transfer
          restrictions  applicable to  such  shares under  the Stockholders
          Agreement,  not later  than  December  31,  1998. The  notes  are
          collateralized by  the pledge  of shares of  common stock  of the
          Company,  may be  prepaid in  part or in  full without  notice or
          penalty  and  bear interest  at  the applicable  federal  rate in
          effect on the first day of  each quarter.  These loans, evidenced
          by  promissory   notes,  are   classified  as   a  reduction   to
          stockholders  equity   in  the  accompanying   balance  sheet  at
          September 30, 1997.

          12.  SUBSEQUENT EVENTS

               PUBLIC OFFERING OF COMMON STOCK AND RECAPITALIZATION

               On October 8, 1997, the Company completed an  initial public
          offering (the "Offering")  of 7,900,000 shares of  Class A Common
          Stock, par  value of  $.001 per  share (the  "New Class  A Common
          Stock"), of  which 5,310,000 shares  were offered by  the Company
          and 2,590,000 shares  were sold by certain  selling stockholders.
          The  offering of  5,310,000  primary  shares  at $18  per  share,
          generated $95.6  million of gross  proceeds. Net proceeds  of the
          offering were  $87 million, after  deducting the expenses  of the
          offering.  The  Company used the proceeds of the  offering to pay
          down the  Company s outstanding debt.   Prior to  consummation of
          the  Offering, the Company  amended and restated  its Charter and
          By-Laws  and effected a recapitalization such that (i) the common
          equity of  the Company consists  of New Class A Common  Stock and
          Class B Convertible Common Stock, par value $.001  per share (the
          "New Class B Common Stock")  and (ii) each previously-outstanding
          share of common stock of  the Company was converted into 6.132043
          shares of New Class A Common Stock.  All share and per share data
          included in the  financial statements and accompanying  footnotes
          have been restated to reflect the recapitalization of New Class A 
          Common Stock.  Shares of New Class A Common Stock held by persons
          other than private equity funds sponsored  by Morgan Stanley Dean
          Witter (the  "Morgan Stanley  Stockholders") and  certain related
          persons  are not  convertible  into  New  Class B  Common  Stock.
          Holders of New Class B Common Stock will have no right to vote on
          matters submitted  to a vote  of stockholders, except  in certain
          circumstances.  Shares  of the New Class  B Common Stock  have no
          preemptive  or other subscription rights and are convertible into
          an equal number of shares  of New Class A Common Stock (1) at the
          option of the  holder thereof to the extent  that, following such
          conversion,  the Morgan  Stanley Stockholders  will  not, in  the
          aggregate, own  more than  49% of the  outstanding shares  of New
          Class  A Common Stock, and (2) automatically upon the transfer of
          such shares by any Morgan  Stanley Stockholder to any person that
          is not a Morgan Stanley Stockholder.

               In  connection  with  the  recapitalization,  the  Company's
          Charter was  amended to  provide that the  Board of  Directors is
          authorized,  subject to  certain limitations  prescribed by  law,
          without further stockholder approval, to issue  from time to time
          up to an aggregate of 10,000,000 shares of Preferred Stock in one
          or more series and to fix or alter the designations, preferences,
          rights and any qualifications, limitations or restrictions of the
          shares  of each  such  series  thereof,  including  the  dividend
          rights, dividend  rates, conversion rights,  voting rights, terms
          of  redemption  (including  sinking  fund provisions)  redemption
          price or prices, liquidation preferences and the number of shares
          constituting  any series  or designations  of such  series.   The
          issuance  of  Preferred Stock  may have  the effect  of delaying,
          deferring or preventing a change in  control of the Company.  The
          rights, preferences and privileges of holders of Common Stock are
          subject  to, and may be adversely  affected by, the rights of the
          holders  of shares  of any  series of  Preferred Stock  which the
          Company may designate and issue  in the future.  The  Company has
          no present plans to issue any shares of Preferred Stock.

               1997 EQUITY INCENTIVE PLAN

               In October  1997, the Board  of Directors  adopted the  1997
          Equity Incentive  Plan for  all employees.   Under the  Plan, the
          Board or  a committee  designated by the  Board is  authorized to
          grant nonqualified stock options, incentive stock options, reload
          options, stock appreciation rights,  shares of restricted  Common
          Stock, performance shares, performance units and shares of Common
          Stock awarded as a bonus.   There are 2,000,000 shares  of Common
          Stock reserved for  issuance under the Plan. On  October 9, 1997,
          the Board of Directors granted options to purchase 993,391 shares
          of  common stock at  $18 per share.  The stock  options expire 10
          years from the date of grant and become exercisable over the next
          five  years in  varying amounts  depending  on the  terms of  the
          individual option agreements.

               REVOLVING CREDIT FACILITY

               On October 17,  1997, the Company completed  a restructuring
          of  its primary bank  credit facility. The  restructured facility
          initially provides the Company with  $150 million in credit on an 
          unsecured, revolving basis at interest  rates which are 250 basis
          points  lower than  the previous  agreement. As  a result  of the
          restructuring   the   Company   anticipates   a   first   quarter
          extraordinary charge of  approximately $2.3 million, net  of tax,
          related to  the write off  of current and deferred  debt issuance
          costs.

               The  current  and  noncurrent  portions  of  long-term  debt
          outstanding at September 30,  1997 have been reclassified in  the
          Company s  balance sheet to  reflect the scheduled  maturities of
          the new debt.  The terms of the new debt are described more fully
          in Note 2. 

          ITEM 9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
                    ACCOUNTING AND FINANCIAL DISCLOSURE.

                    Not applicable.

                                       PART III

               AIPC  has incorporated by reference certain responses to the
          Items of this Part III pursuant to Rule 12b-23 under the Exchange
          Act and General Instruction G(3) to Form  10-K. AIPC's definitive
          proxy statement for the 1998 annual meeting of stockholders  (the
          "Definitive  Proxy Statement")  will be  filed no later  than 120
          days after October 3, 1997.

          ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

               (a)  Directors of the Company

               The  information  set  forth  in  response  to Item  401  of
          Regulation S-K under the heading  "Proposal 1 - Election of Three
          Directors"  and "The  Board of  Directors"  in AIPC's  Definitive
          Proxy  Statement is incorporated  herein by reference  in partial
          response to this Item 10.

               (b)  Executive Officers of the Company

               The  information  set  forth  in response  to  Item  401  of
          Regulation  S-K under "Executive  Officers of the  Registrant" an
          unnumbered  Item  in   Part  1  (immediately  following   Item  4
          Submission of Matters to a Vote of Security Holders) of this Form
          10-K is incorporated  herein by reference in  partial response to
          this Item 10.

               The information  set  forth  in  response  to  Item  405  of
          Regulation  S-K  under  the  heading  "Section  16(a)  Beneficial
          Ownership  Reporting  Compliance"  in  AIPC's  Definitive   Proxy
          Statement is incorporated herein by reference in partial response
          to this Item 10.

          ITEM 11.  EXECUTIVE COMPENSATION.

               The  information  set  forth  in  response  to  Item 402  of 
          Regulation   S-K  under   "Management  Compensation"   in  AIPC's
          Definitive  Proxy   Statement,  (other   than  The   Compensation
          Committee Report  on Executive  Compensation) is  incorporated by
          reference in response to this Item 11.

          ITEM 12.  SECURITY  OWNERSHIP OF  CERTAIN  BENEFICIAL OWNERS  AND
          MANAGEMENT.

               The  information set  forth  in  response  to  Item  403  of
          Regulation  S-K under  the  heading  "Principal Stockholders  and
          Stock  Owned  Beneficially  by  Directors  and  Certain Executive
          Officers"  in   AIPC's  Definitive  Proxy  Statement   is  hereby
          incorporated by reference in response to this Item 12.

          ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

               The  information  set  forth  in  response  to  Item  404 of
          Regulation  S-K  under  the  heading  "Certain  Relationships and
          Related  Transactions" in  AIPC's Definitive  Proxy Statement  is
          incorporated herein by reference in response to this Item 13. 

          ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
          FORM 8-K.

               (a)  The following items are filed as a part of the report:

                    1.   The  Company's  financial statements  prepared  in
                         accordance  with  Regulation  S-X,  including  the
                         statements   of   operations,    cash   flow   and
                         stockholder's equity for the three fiscal  periods
                         ended December  31, 1995,  September 30,  1996 and
                         September  30, 1997 and  the balance sheets  as of
                         September 30, 1996 and 1997, and related notes and
                         the  independent  auditor's  opinion  thereon  are
                         included under Item 8 of this Annual Report.

                    2.   No financial  statement schedules are  required to
                         be  included   in  this   Annual  Report   by  the
                         Securities and Exchange Commission's regulations.

                    3.   The  list of exhibits following the signature page
                         of this Annual Report is incorporated by reference
                         herein in partial response to this Item.

               (b)  Reports on Form 8-K.

               The Company  did not  file any current  reports on  Form 8-K
          during the last fiscal quarter covered by this Annual Report.

          <PAGE> 
                                      SIGNATURES

               Pursuant to the  requirements of Section 13 or  15(d) of the
          Securities  Exchange Act of 1934,  the Registrant has duly caused
          this  report to  be  signed  on its  behalf  by the  undersigned,
          thereunto duly authorized.

                                        AMERICAN ITALIAN PASTA COMPANY


                                        By:  /s/ Timothy S. Webster
                                             -------------------------
                                             Timothy S. Webster
                                             President and Chief
                                             Executive Officer

          Date December 23, 1997

               Pursuant  to the requirements of the Securities Exchange Act
          of  1934, this  report has  been  signed below  by the  following
          persons on behalf of the Registrant and in the capacities and  on
          the dates indicated.

          <TABLE>
          <CAPTION>
                           POWER OF ATTORNEY AND SIGNATURES

               Each  of  the undersigned  hereby  severally  constitute and
          appoint Timothy S.  Webster and David E. Watson, and each of them
          singly, with power of substitution and resubstitution, as  his or
          her true and lawful  attorneys, with full power to them  and each
          of them singly,  to sign for  us in our  names in the  capacities
          indicted below, all amendments to this Annual Report on Form 10-K
          and generally to do all things in our names and on our behalf  in
          such  capacities  to  enable American  Italian  Pasta  Company to
          comply with  the provisions  of the  Securities  Exchange Act  of
          1934,  and  all  requirements  of  the  Securities  and  Exchange
          Commission with respect to this Annual Report on Form 10-K.

          <S>                        <C>                   <C>

          /S/ Horst W. Schroeder      Chairman of the       December 23, 1997
          -------------------------   Board of Directors

          /S/ Timothy S. Webster      President, Chief      December 23, 1997
          -------------------------   Executive Officer
                                      and Director
                                      (Principal Executive
                                      Officer)

          /S/ David E. Watson         Executive Vice        December 23, 1997
          -------------------------   President and Chief
                                      Financial Officer,
                                      Treasurer and
                                      Secretary (Principal 
                                      Financial and
                                      Accounting Officer)

          S/ Robert H. Niehaus        Director              December 23, 1997
          -------------------------

          /S/ Richard S. Thompson     Director              December 23, 1997
          -------------------------

          /S/ Jonathan E. Baum        Director              December 23, 1997
          -------------------------

          /S/ David Y. Howe           Director              December 23, 1997
          -------------------------

          /S/ Lawrence B. Sorrel      Director              December 23, 1997
          -------------------------

          /S/ Amy S. Rosen            Director              December 23, 1997
          -------------------------

          /S/ James A. Schlindwein    Director              December 23, 1997
          -------------------------
          </TABLE>

             SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED
              PURSUANT TO SECTION 15(D) OF THE ACT BY REGISTRANTS WHICH
           HAVE NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT

          Not applicable.

          <PAGE> 

                                    EXHIBIT INDEX

          Exhibit
          Number    Description
          -------   -----------
          (2)       Plan  of   Acquisition,  Reorganization,   Arrangement,
                    Liquidation or Succession

                    Not applicable.

          (3)       Articles and By-Laws

                    3.1  The Company's amended and  restated Certificate of
                         Incorporation dated  October  7,  1997,  which  is
                         attached   as  Exhibit   3.1   to  the   Company's
                         registration  statement  on Form  S-1,  as amended
                         (Commission file no. 333-32827) (the "Registration
                         Statement"), is  incorporated by  reference herein
                         as Exhibit 3.1.

                    3.2  The Company's  amended and restated  By-Laws dated
                         October  7, 1997, which is attached as Exhibit 3.2
                         to the Registration Statement, are incorporated by
                         reference herein as Exhibit 3.2.

          (4)       Instruments Defining  the Rights  of Security  Holders,
                    Including Indentures

                    4.1  The   specimen   certificate    representing   the
                         Company's  Class A  Convertible Common  Stock, par
                         value  $0.001  per  share,  which  is  attached as
                         Exhibit  4.1 to  the  Registration Statement,  are
                         incorporated by reference herein as Exhibit 4.1.

                    4.2  The   specimen   certificate    representing   the
                         Company's  Class B  Convertible Common  Stock, par
                         value  $0.001  per  share, which  is  attached  as
                         Exhibit  4.2 to  the  Registration Statement,  are
                         incorporated by reference herein as Exhibit 4.2.

                    4.3  Section 7.1 of the Company's  amended and restated
                         Certificate    of    Incorporation,    which    is
                         incorporated   herein    as   Exhibit    3.1,   is
                         incorporated by reference herein as Exhibit 4.3.

                    4.4  Article II  of the Company's amended  and restated
                         Bylaws, which  is incorporated  herein as  Exhibit
                         3.2, is incorporated by reference herein as 
                         Exhibit 4.4.

                    4.5  Sections  1,  2,  3,  4  of  Article  III  of  the
                         Company's amended  and restated  Bylaws, which  is
                         incorporated   herein    as   Exhibit    3.2,   is
                         incorporated by     reference  herein  as  Exhibit
                         4.5. 

                    4.6  Article VII  of the Company's amended and restated
                         Bylaws, which  is incorporated  herein as  Exhibit
                         3.2,  is  incorporated  by  reference  herein   as
                         Exhibit 4.6.

                    4.7  Article IX of  the Company's amended  and restated
                         Bylaws,  which is  incorporated herein  as Exhibit
                         3.2, is incorporated by reference herein as 
                         Exhibit 4.7.

          (9)       Voting Trust Agreements

                    Not applicable.

          (10)      Material Contracts

                    10.1 Credit Agreement among the  Company, various banks
                         named therein,  Bankers Trust  Company and  Morgan
                         Stanley  Senior Fund, Inc. dated as of October 30,
                         1992,  as amended  and restated  as  of April  11,
                         1997, which  is attached  as Exhibit  10.1 to  the
                         Registration   Statement,   is   incorporated   by
                         reference herein as Exhibit 10.1.

                    10.2 Manufacturing and Distribution  Agreement dated as
                         of April  15, 1997 between CPC  International Inc.
                         and the Company, which is attached as Exhibit 10.2
                         to the Registration  Statement, is incorporated by
                         reference herein as Exhibit 10.2.

                    10.3 Amended  and   Restated  Supply   Agreement  dated
                         October 29, 1992, as amended July 1, 1997, between
                         the  Company  and  Sysco  Corporation,  which   is
                         attached  as  Exhibit  10.3  to  the  Registration
                         Statement, is incorporated by  reference herein as
                         Exhibit 10.3.

                    10.4 Warehouse  Lease dated  May 23,  1995 between  the
                         Company and  Lanter Company, which  is attached as
                         Exhibit  10.4 to  the  Registration Statement,  is
                         incorporated by reference herein as Exhibit 10.4.

                    10.5 Employment  Agreement  between   the  Company  and
                         Timothy  S.  Webster  effective  October 8,  1997,
                         which  is   attached  as   Exhibit  10.5   to  the
                         Registration   Statement,   is   incorporated   by
                         reference herein as Exhibit 10.5.

                    10.6 Employment  Agreement  dated  September  30,  1997
                         between the  Company and Horst W. Schroeder, which
                         is  attached as Exhibit  10.6 to  the Registration
                         Statement, is incorporated  by reference herein as
                         Exhibit 10.6.
                    10.7 Employment  Agreement  dated  September  30,  1997
                         between  the Company and David E. Watson, which is
                         attached  as  Exhibit  10.7  to  the  Registration
                         Statement, is incorporated by reference herein  as 
                         Exhibit 10.7.

                    10.8 Employment  Agreement  dated  September  30,  1997
                         between  the Company and Norman F. Abreo, which is
                         attached  as  Exhibit  10.8  to  the  Registration
                         Statement, is incorporated by reference herein  as
                         Exhibit 10.8.

                    10.9 Employment  Agreement  dated  September  30,  1997
                         between  the Company and David B. Potter, which is
                         attached  as  Exhibit  10.9  to  the  Registration
                         Statement, is incorporated by reference herein  as
                         Exhibit 10.9.

               10.10     Amended and Restated Shareholders' Agreement dated
                         October 6, 1997  by and between the  parties named
                         therein, which is attached as Exhibit 10.10 to the
                         Registration   Statement,   is   incorporated   by
                         reference herein as Exhibit 10.10.

               10.11     American Italian  Pasta Company 1992  Stock Option
                         Plan,  which is attached  as Exhibit 10.11  to the
                         Registration   Statement,   is   incorporated   by
                         reference herein as Exhibit 10.11.

               10.12     American Italian Pasta  Company 1993 Non-Qualified
                         Stock  Option Plan,  which is attached  as Exhibit
                         10.12   to   the    Registration   Statement,   is
                         incorporated by reference herein as Exhibit 10.12.

               10.13     1996  Salaried Bonus  Plan, which  is attached  as
                         Exhibit 10.13  to the  Registration Statement,  is
                         incorporated by reference herein as Exhibit 10.13.

               10.14     1997 Equity Incentive  Plan, which is attached  as
                         Exhibit 10.14  to the  Registration Statement,  is
                         incorporated by reference herein as Exhibit 10.14.

          (11)      Statement re computation of per share earnings 

                    Not applicable.

          (12)      Statements re computation of ratios 

                    Not applicable.

          (13)      Annual  report  to  security   holders,  Form  10-Q  or
                    quarterly report to security holders

                    Not applicable.
          (16)      Letter re change in certifying accountant 

                    Not applicable.

          (18)      Letter re change in accounting principles

                    Not applicable. 

          (21)      Subsidiaries of the registrant

                    Not applicable.

          (22)      Published report regarding matters submitted to vote of
                    security holders

                    Not applicable.

          (23)      Consents of experts and counsel

                    Not applicable.

          (24)      Power of Attorney

                    The  power of attorney  is set  forth on  the signature
                    page of this Annual Report.

          (27)      Financial Data Schedule 

                    The  Company's  Financial  Data  Schedule  is  attached
                    hereto as Exhibit 27.

          (99)      Additional Exhibits

                    Not applicable.