<PAGE>

================================================================================

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

                             --------------------

                                   FORM 10-Q

(Mark One)

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

    For the quarterly period ended June 30, 2001

                                      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 001-14255

                             --------------------

                               AURORA FOODS INC.
             (Exact Name of Registrant as Specified in Its Charter)

              DELAWARE                                 94-3303521
              --------                                 ----------
  (State or Other Jurisdiction of            (IRS Employer Identification No.)
   Incorporation or Organization)

                    1000 Union Station, St. Louis, MO 63103
          (Address of Principal Executive Office, Including Zip Code)

                                (314) 241-0303
             (Registrant's Telephone Number, Including Area Code)

                             --------------------

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 Or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter Period that the
registrant was required to file such reports), and (2) has been subject to such
filing Requirements for the past 90 days.   Yes [X]   No [_]

     Indicate the number of shares outstanding of each of the registrant's
classes of common stock as of the Latest practicable date.

                                                        Shares Outstanding
                                                          August 3, 2001
                                                        ------------------
     Common stock, $0.01 par value.....................     71,610,091

     The number of shares outstanding as of August 3, 2001 reflects the initial
share transfers to and from the Company in connection with the settlement, as
described in Note 6 to the financial statements included herein.

================================================================================
<PAGE>

                        PART I - FINANCIAL INFORMATION

ITEM 1:  FINANCIAL STATEMENTS

See pages 2 through 14.

                                       2
<PAGE>

                               AURORA FOODS INC.
                                BALANCE SHEETS
                (dollars in thousands except per share amounts)

<TABLE>
<CAPTION>
                                                                                                   June 30,         December 31,
                                                                                                     2001               2000
                                                                                                -------------     ----------------
<S>                                                                                             <C>               <C>
                                        ASSETS                                                   (unaudited)
                                        ------
Current assets:
     Cash and cash equivalents.................................................................  $    2,710          $      525
     Accounts receivable, net of $798 and $725 allowance, respectively.........................      73,391             121,193
     Accounts receivable sold..................................................................     (28,606)            (38,565)
     Inventories...............................................................................      84,755             104,319
     Prepaid expenses and other assets.........................................................      11,841               6,496
     Current deferred tax assets...............................................................      18,797              17,133
                                                                                                 ----------          ----------
           Total current assets................................................................     162,888             211,101

     Property, plant and equipment, net........................................................     229,585             239,107
     Deferred tax asset........................................................................      47,353              40,045
     Goodwill and other intangible assets, net.................................................   1,249,140           1,268,942
     Other assets..............................................................................      32,219              35,091
                                                                                                 ----------          ----------
           Total assets........................................................................  $1,721,185          $1,794,286
                                                                                                 ==========          ==========

                              LIABILITIES AND STOCKHOLDERS' EQUITY
                              ------------------------------------
Current liabilities:
     Current portion of senior securred term debt..............................................  $   32,926          $   32,926
     Accounts payable..........................................................................      47,214              50,456
     Accrued liabilities.......................................................................      74,387              87,840
                                                                                                 ----------          ----------
           Total current liabilities...........................................................     154,527             171,222

     Senior secured term debt..................................................................     494,202             510,665
     Senior secured revolving debt facility....................................................     146,400             160,000
     Senior subordinated notes.................................................................     401,721             401,837
     Other liabilities.........................................................................      12,122               5,848
                                                                                                 ----------          ----------
           Total liabilities...................................................................   1,208,972           1,249,572
                                                                                                 ==========          ==========

Commitments and contingencies

Stockholders' equity:
     Preferred stock, $0.01 par value; 25,000,000 shares authorized; 3,750,000
        shares, Series A Convertible Cumulative, issued and outstanding, with a
        liquidation preference value of $15,915................................................          37                  37
     Common stock, $0.01 par value; 250,000,000 shares authorized; 74,196,132
        and 74,123,682 shares issued, respectively.............................................         742                 741
     Paid-in capital...........................................................................     685,359             685,091
     Treasury Stock............................................................................     (13,266)                  -
     Promissory notes..........................................................................        (120)               (227)
     Accumulated deficit.......................................................................    (158,298)           (140,928)
     Accumulated other comprehensive loss......................................................      (2,241)                  -
                                                                                                 ----------          ----------
           Total stockholders' equity..........................................................     512,213             544,714
                                                                                                 ----------          ----------
           Total liabilities and stockholders' equity..........................................  $1,721,185          $1,794,286
                                                                                                 ==========          ==========
</TABLE>
                See accompanying notes to financial statements.

                                       3
<PAGE>

                               AURORA FOODS INC.
                           STATEMENTS OF OPERATIONS
                    (in thousands except per share amounts)
                                  (unaudited)

<TABLE>
<CAPTION>
                                                                                                       Three Months Ended June 30,
                                                                                                       ---------------------------
                                                                                                         2001              2000
                                                                                                       ---------         ---------
<S>                                                                                                    <C>               <C>
Net sales............................................................................................. $ 219,898         $ 214,721
Cost of goods sold ...................................................................................  (108,904)         (101,458)
                                                                                                       ---------         ---------
     Gross profit.....................................................................................   110,994           113,263
                                                                                                       ---------         ---------
Brokerage, distribution and marketing expenses:
     Brokerage and distribution ......................................................................   (25,516)          (25,114)
     Trade promotions ................................................................................   (38,291)          (41,806)
     Consumer marketing...............................................................................    (4,876)           (8,293)
                                                                                                       ---------         ---------
           Total brokerage, distribution and marketing expenses.......................................   (68,683)          (75,213)
Amortization of goodwill and other intangibles .......................................................   (11,322)          (10,729)
Selling, general and administrative expenses .........................................................   (15,651)          (12,095)
Other financial, legal, accounting, consolidation and transition income (expense) ....................     3,066           (15,056)
                                                                                                       ---------         ---------
           Total operating expenses...................................................................   (92,590)         (113,093)
                                                                                                       ---------         ---------
     Operating income ................................................................................    18,404               170
Interest expense, net ................................................................................   (30,362)          (27,126)
Amortization of deferred financing expense ...........................................................      (867)             (735)
Other bank and financing expenses ....................................................................       (37)             (101)
                                                                                                       ---------         ---------
     Loss before income taxes.........................................................................   (12,862)          (27,792)
Income tax benefit ...................................................................................     3,864             8,909
                                                                                                       ---------         ---------
     Net loss.........................................................................................    (8,998)          (18,883)
Preferred dividends ..................................................................................      (308)                -
                                                                                                       ---------         ---------
     Net loss available to common stockholders........................................................ $  (9,306)        $ (18,883)
                                                                                                       =========         =========
Basic and diluted loss per share available to common stockholders .................................... $   (0.13)        $   (0.28)
                                                                                                       =========         =========
Weighted average number of shares outstanding ........................................................    72,675            67,050
                                                                                                       =========         =========
</TABLE>

                See accompanying notes to financial statements.

                                       4
<PAGE>


                               AURORA FOODS INC.
                            STATEMENTS OF OPERATIONS
                    (in thousands except per share amounts)
                                  (unaudited)

<TABLE>
<CAPTION>
                                                                           Six Months Ended June 30,
                                                                           -------------------------
                                                                             2001            2000
                                                                           ---------       ---------
<S>                                                                        <C>             <C>
Net sales...............................................................   $ 503,490       $ 496,729
Cost of goods sold......................................................    (242,838)       (239,860)
                                                                           ---------       ---------
      Gross profit......................................................     260,652         256,869
                                                                           ---------       ---------
Brokerage, distribution and marketing expenses:
      Brokerage and distribution........................................     (58,429)        (59,077)
      Trade promotions..................................................     (91,815)        (96,207)
      Consumer marketing................................................     (23,881)        (26,264)
                                                                           ---------       ---------
         Total brokerage, distribution and marketing expenses...........    (174,125)       (181,548)
Amortization of goodwill and other intangibles..........................     (22,523)        (21,480)
Selling, general and administrative expenses............................     (31,384)        (26,672)
Other financial, legal, accounting, consolidation and transition
 income (expense).......................................................       3,066         (26,022)
                                                                           ---------       ---------
         Total operating expenses.......................................    (224,966)       (255,722)
                                                                           ---------       ---------
      Operating income..................................................      35,686           1,147
Interest expense, net...................................................     (58,232)        (51,547)
Amortization of deferred financing expense..............................      (1,734)         (1,443)
Other bank and financing expenses.......................................         (74)           (188)
                                                                           ---------       ---------
      Loss before income taxes and cumulative effect of
        change in accounting............................................     (24,354)        (52,031)
Income tax benefit......................................................       7,599          16,649
                                                                           ---------       ---------
      Net loss before cumulative effect of change in accounting.........     (16,755)        (35,382)
Cumulative effect of change in accounting, net of tax of $5,722.........           -         (12,161)
                                                                           ---------       ---------
      Net loss..........................................................     (16,755)        (47,543)
Preferred dividends.....................................................        (615)              -
                                                                           ---------       ---------
      Net loss available to common stockholders.........................   $ (17,370)      $ (47,543)
                                                                           =========       =========
Basic and diluted loss per share available to common stockholders:
      Loss before cumulative effect of change in accounting.............   $   (0.24)      $   (0.53)
      Cumulative effect of change in accounting, net of tax.............           -           (0.18)
                                                                           ---------       ---------
      Net loss available to common stockholders.........................   $   (0.24)      $   (0.71)
                                                                           =========       =========
Weighted average number of shares outstanding...........................      73,395          67,050
                                                                           =========       =========
</TABLE>

                See accompanying notes to financial statements.

                                       5
<PAGE>

                               AURORA FOODS INC.
                 STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                                (in thousands)
                                  (unaudited)

<TABLE>
<CAPTION>
                                                                                                         Accumulated
                                                    Additional                                              Other
                               Preferred   Common    Paid-in     Promissory   Treasury    Accumulated   Comprehensive
                                 Stock     Stock     Capital       Notes        Stock       Deficit          Loss         Total
                               ---------   ------   ----------   ----------   --------    -----------   -------------   ----------
<S>                            <C>          <C>     <C>           <C>         <C>         <C>               <C>         <C>
Balance at December 31, 2000.   $    37     $741    $  685,091    $  (227)    $      -    $ (140,928)       $     -     $  544,714

Receipt of shares from
 former management...........         -        -             -          -      (15,653)            -              -        (15,653)

Distribution of shares to
 shareholder class...........                              113                   2,387                                       2,500

Employee stock purchases.....         -        1           152          -            -             -              -            153

Restricted stock awards......         -        -             3          -            -             -              -              3

Net loss.....................         -        -             -          -            -       (16,755)             -        (16,755)

Cumulative preferred
 dividends...................         -        -             -          -            -          (615)             -           (615)

Payment on officer
 promissory notes............         -        -             -        107            -             -              -            107

Adoption of FAS 133..........         -        -             -          -            -             -         (2,277)        (2,277)

Net deferred hedging loss....         -        -             -          -            -             -             36             36
                                -------     ----    ----------    -------     --------    ----------        -------     ----------
Balance at June 30, 2001.....   $    37     $742    $  685,359    $  (120)    $(13,266)   $ (158,298)       $(2,241)    $  512,213
                                =======     ====    ==========    =======     ========    ==========        =======     ==========
</TABLE>

                See accompanying notes to financial statements.

                                       6
<PAGE>


                               AURORA FOODS INC.
                            STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                  (unaudited)

<TABLE>
<CAPTION>
                                                                                 Six Months Ended June 30,
                                                                                --------------------------
                                                                                    2001           2000
                                                                                ----------       --------
<S>                                                                              <C>             <C>
Cash flows from operations:
      Net loss................................................................   $(16,755)       $(47,543)
      Adjustments to reconcile net loss to net cash from operations:
            Depreciation and amortization.....................................     37,552          35,357
            Deferred income taxes.............................................     (7,599)        (16,649)
            Recognition of loss on derivatives................................      4,901               -
            Receipt of shares from former management..........................    (15,654)              -
            Recognition of liability to shareholder class.....................     10,000               -
            Non-cash restructuring cost.......................................          -           3,050
            Cumulative effect of change in accounting, net of tax.............          -          12,161
            Other.............................................................        189               -
            Changes in operating assets and liabilities:
                  Accounts receivable.........................................     47,803          15,999
                  Accounts receivable sold....................................     (9,959)         20,418
                  Inventories.................................................     19,564            (659)
                  Prepaid expenses and other current assets...................     (5,330)          9,261
                  Accounts payable............................................     (3,857)        (32,764)
                  Accrued expenses............................................    (20,952)        (30,143)
                  Other non-current liabilities...............................     (2,712)           (489)
                                                                                ---------        --------
Net cash provided by (used in) operations.....................................     37,191         (32,001)
                                                                                ---------        --------
Cash flows from investing activities:
      Asset additions.........................................................     (5,269)         (6,973)
      Proceeds from asset sales...............................................         66           1,175
      Changes to other non-current assets and liabilities.....................          -          (2,497)
      Payment for acquisition of businesses...................................          -          (7,984)
                                                                                ---------        --------
Net cash used for investment activities.......................................     (5,203)        (16,279)
                                                                                ---------        --------
Cash flows from financing activities:
      Senior secured revolving (repayments) borrowings, net...................    (13,600)         65,000
      Repayment of borrowings.................................................    (16,462)        (11,517)
      Payments on officer promissory notes....................................        259             237
      Debt issuance and equity offering costs.................................          -            (132)
                                                                                ---------        --------
Net cash (used for) provided by financing activities..........................    (29,803)         53,588
                                                                                ---------        --------
Increase in cash and cash equivalents.........................................      2,185           5,308
Cash and cash equivalents, beginning of period................................        525             315
                                                                                ---------        --------
Cash and cash equivalents, end of period......................................   $  2,710        $  5,623
                                                                                =========        ========
</TABLE>

                See accompanying notes to financial statements.

                                       7
<PAGE>

                               AURORA FOODS INC.
                       NOTES TO THE FINANCIAL STATEMENTS
                                 June 30, 2001


NOTE 1 - BASIS OF PRESENTATION

Interim Financial Statements

     The interim financial statements of the Company included herein have not
been audited by independent accountants.  The statements include all
adjustments, including normal recurring accruals, which management considers
necessary for a fair presentation of the financial position and operating
results of the Company for the periods presented.  The statements have been
prepared by the Company pursuant to the rules and regulations of the Securities
and Exchange Commission.  Accordingly, certain information and footnote
disclosures normally included in financial statements prepared in conformity
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations.  The operating results for interim
periods are not necessarily indicative of results to be expected for an entire
year.  Certain prior period amounts have been reclassified to conform to the
current period's presentation.

     For further information, reference should be made to the financial
statements of the Company and notes thereto included in the annual report on
Form 10-K of the Company for the year ended December 31, 2000.

The Company

     The Company has acquired premium, well recognized brands with strong brand
equity that had been undermarketed and undermanaged in recent years and had
become non-core businesses to their corporate parents.  The Company's objective
is to renew the growth of its brands by giving them the focus, strategic
direction, product development, and dedicated sales and marketing resources they
have lacked in recent years. The Company's goal is to then sustain the growth of
the brands with high levels of marketing support directed towards increased
advertising, consumer promotions, new products, packaging improvements and new
packaging.  Each of the Company's brands is a leading brand with significant
market share and strong consumer awareness.  The Company primarily competes in
the following three industry segments: retail, food service and other
distribution channels.  The Company's products are sold nationwide, primarily
through food brokers to supermarkets, wholesale and retail grocery accounts and
other retail channels, as well as food service distribution channels (restaurant
chains, business/industry and schools) and club store, private label and
military customers.  Distribution is either directly to the customer or through
independent wholesalers and distributors.


Accounting Change

     Effective January 1, 2000, the Company adopted the consensus reached in
EITF 00-14, Accounting for Certain Sales Incentives.  This change in accounting
principle, required to be adopted by most companies in 2002, has the effect of
accelerating the recognition of certain marketing expenses as well as requiring
that certain items previously classified as distribution, promotion and
marketing expenses be classified as reductions of revenue.  After adopting EITF
00-14, the Company now expenses all estimated costs associated with redemption
of consumer coupons at the time they are distributed, rather than reflecting
them as expense over the expected redemption period.  In addition, the estimated
coupon redemption costs along with certain other allowances typically given to
retailers and others to facilitate certain promotions and distribution have been
reclassified from expense to net sales in the accompanying statement of
operations.

     As a result of this change in accounting in first quarter 2000, the
cumulative after tax effect of the change on prior years (to December 31, 1999)
of $12,161,000 was recognized as an expense in the Statement of Operations for
the three months ended March 31, 2000.

                                       8
<PAGE>

Impact of New Accounting Pronouncements

     In April, 2001, the Emerging Issues Task Force reached consensus on EITF
No. 00-25, Accounting for Consideration from a Vendor to a Retailer in
Connection with the Purchase or Promotion of the Vendor's Products.  Although
the Company has not yet quantified the impact of this change in accounting,
management expects that adoption of this consensus will require that certain
expenses, currently classified as trade promotion expense, will be required to
be reclassified as reductions of net sales, with no effect on the reported
amount of operating income.  Adoption of the change will be required in
financial statements issued by the Company in 2002, and prior periods' financial
statements will be restated to conform with the new presentation.

     In late June 2001, the FASB approved the issuance of FAS 142, Goodwill and
Other Intangible Assets which, for the Company, will be required as of January
1, 2002.  Although the Company has not yet reviewed the statement in detail or
quantified the impacts, management expects that the adoption of the new
pronouncement will result in decreases in the ongoing amount of amortization of
goodwill and other intangible assets reflected in the Company's statements of
operations in future periods.

NOTE 2 - INVENTORIES

     Inventories consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                                            June 30,               December 31,
                                                                              2001                     2000
                                                                           -----------             ------------
<S>                                                                     <C>                      <C>
                                                                           (unaudited)
Raw materials....................................................            $21,799                 $ 28,764
Work in process..................................................                171                      299
Finished goods...................................................             54,746                   66,787
Packaging and other supplies.....................................              8,039                    8,469
                                                                             -------                 --------
                                                                             $84,755                 $104,319
                                                                             =======                 ========
</TABLE>


NOTE 3 - OTHER FINANCIAL, LEGAL, ACCOUNTING, CONSOLIDATION AND TRANSITION INCOME
     (EXPENSE)

     During the second quarter of 2001, in connection with the settlement of the
securities class action and derivative lawsuits, as more fully described in Note
6, the Company received 3,051,303 shares of the Company's common stock from
former management. These shares were recorded as Treasury Stock at an amount
equal to the market value of the shares at the date the settlement was confirmed
by the court.  In addition, the Company recorded a liability for the value of
the shares required to be distributed to members of the shareholder class in the
amount of $10.0 million and recorded accruals for estimated remaining costs to
be incurred to complete all of the Company's obligations under terms of the
settlement agreements.  As a result, a pretax net gain of approximately $3.8
million was recorded and is reflected as other financial legal and accounting
income in the accompanying Statement of Operations.

     Also during the second quarter of 2001, the Company recorded an additional
charge of $0.7 million to reflect the additional net cost expected to be
incurred by the Company for its unused office space in Columbus, Ohio,
subsequent to the administration consolidation in 2000.

     The Company does not expect to record any material amounts of expense
related to these issues in future periods.


NOTE 4 - EARNINGS PER SHARE AND NUMBER OF COMMON SHARES OUTSTANDING

     Basic earnings per share represents the income available to common
stockholders divided by the weighted average number of common shares outstanding
during the measurement period.  Diluted earnings per share represents the income
available to common stockholders divided by the weighted average number of
common shares

                                       9
<PAGE>


outstanding during the measurement period while also giving effect to all
potentially dilutive common shares that were outstanding during the period.
Potentially dilutive common shares consist of stock options (the dilutive impact
is calculated by applying the "treasury stock method") and convertible preferred
stock.

     As none of the outstanding stock options and convertible preferred stock
have a potentially dilutive effect for the three and six month periods ended
June 30, 2001 or 2000, the loss amounts and the weighted averages shares
outstanding contained in the Statements of Operations were used to compute both
the basic and diluted loss per share.

Common shares outstanding

     The number of shares of common stock outstanding and the transactions
during the six month period ended June 30, 2001 were as follows:

<TABLE>
<CAPTION>
                                                                Common
                                                                Stock       Treasury           Net
                                                                Issued        Stock        Outstanding
                                                              ----------    ----------     -----------
       <S>                                                    <C>           <C>            <C>
       Shares at December 31, 2000..........................  74,123,682             -      74,123,682
       Receipt of shares from former management.............           -    (3,051,383)     (3,051,383)
       Distribution of shares to shareholder class..........           -       465,342         465,342
       Employee stock purchases.............................      71,750             -          71,750
       Restricted stock awards to employees.................         700             -             700
                                                              ----------    ----------     -----------
       Shares at June 30, 2001..............................  74,196,132    (2,586,041)     71,610,091
                                                              ==========    ==========     ===========
</TABLE>

NOTE 5 - SEGMENT INFORMATION

     The Company groups its business in three operating segments: retail, food
service and other distribution channels. In general, each of the Company's
brands are sold through each of the segments. The retail distribution segment
includes all of the Company's brands and products sold to customers who sell or
distribute these products to consumers through supermarkets, grocery stores and
normal grocery retail outlets. The food service segment includes both branded
and non-branded products sold to customers such as restaurants,
business/industry and schools. The other distribution channels segment includes
sales of branded and private label products to club stores, the military, mass
merchandisers, convenience, drug and chain stores, as well as exports from the
United States.

     The Company's segments have changed from those presented in prior years,
consistent with the organization and responsibilities of management reporting to
the chief operating decision-maker for the purpose of assessing performance.
Information for the corresponding interim period in the prior year has been
restated to conform to the new definition. The Company's definition of segment
contribution differs from operating income as presented in its primary financial
statements and a reconciliation of the segmented and consolidated results is
provided in the following table. Interest expense, financing costs and income
tax amounts are not allocated to the operating segments.

     The Company's assets are not managed or maintained on a segmented basis.
Property, plant and equipment is used in the production and packaging of
products for each of the segments. Cash, accounts receivable, prepaid expenses,
other assets and deferred tax assets are maintained and managed on a
consolidated basis and generally do not pertain to any particular segment.
Inventories include primarily raw materials and packaged finished goods, which
in most circumstances are sold through any or all of the segments. The Company's
goodwill and other intangible assets, which include its trademarks, are used by
and pertain to the activities and brands sold

                                      10
<PAGE>

across all of its segments. As no segmentation of the Company's assets,
depreciation expense (included in fixed manufacturing costs and general and
administrative expenses) or capital expenditures is maintained by the Company,
no allocation of these amounts has been made solely for purposes of segment
disclosure requirements.

     The following table presents a summary of operations by segment (in
thousands):

<TABLE>
<CAPTION>
                                                              Three months ended June 30,             Six months ended June 30,
                                                          -----------------------------------    ----------------------------------
                                                                2001               2000               2001                2000
                                                          ---------------    ----------------    --------------      --------------
                                                                                         (unaudited)
<S>                                                       <C>                <C>                 <C>                 <C>
Net sales:
  Retail................................................      $179,034           $178,475            $418,678           $417,311
  Food Service..........................................        16,490             16,281              32,308             32,193
  Other.................................................        24,374             19,965              52,504             47,225
                                                              --------           --------            --------           --------
    Total...............................................      $219,898           $214,721            $503,490           $496,729
                                                              ========           ========            ========           ========
Segment contribution and operating income:
  Retail................................................      $ 48,745           $ 42,918            $ 97,868           $ 88,237
  Food Service..........................................         5,547              5,616              10,706             10,907
  Other.................................................         6,895              6,187              14,543             13,995
                                                              --------           --------            --------           --------
    Segment contribution................................        61,187             54,721             123,117            113,139
  Fixed manufacturing costs.............................       (18,876)           (16,671)            (36,590)           (37,818)
  Amortization of goodwill and other intangibles........       (11,322)           (10,729)            (22,523)           (21,480)
  Selling, general and administrative expenses..........       (15,651)           (12,095)            (31,384)           (26,672)
  Other financial, legal, accounting, consolidation
    and transition income (expense).....................         3,066            (15,056)              3,066            (26,022)
                                                              --------           --------            --------           --------
    Operating income....................................      $ 18,404           $    170            $ 35,686           $  1,147
                                                              ========           ========            ========           ========
</TABLE>

The following supplemental information provides net sales by product line across
all segments (in thousands):

<TABLE>
<CAPTION>
                                                              Three months ended June 30,             Six months ended June 30,
                                                          -----------------------------------    ----------------------------------
                                                                2001               2000               2001                2000
                                                          ---------------    ----------------    --------------      --------------
                                                                                         (unaudited)
<S>                                                       <C>                <C>                 <C>                 <C>
Seafood.................................................      $ 36,387           $ 37,264            $124,957           $116,065
Baking mixes and frostings..............................        51,111             45,702             110,404             99,632
Bagels..................................................        38,211             42,340              75,939             86,595
Syrup and Mixes.........................................        32,654             28,125              65,375             67,025
Breakfast products......................................        28,120             27,050              57,697             56,831
All other...............................................        33,415             34,240              69,118             70,581
                                                              --------           --------            --------           --------
   Totals...............................................      $219,898           $214,721            $503,490           $496,729
                                                              ========           ========            ========           ========
</TABLE>

NOTE 6 - CONTINGENCIES

Litigation

     During 2000, the Company was served with eighteen complaints in purported
class action lawsuits filed in the U.S. District Court for the Northern District
of California. The complaints received by the Company alleged that, among other
things, as a result of accounting irregularities, the Company's previously
issued financial statements were materially false and misleading and thus
constituted violations of federal securities laws by the Company and the
directors and officers who resigned on February 17, 2000 (Ian R. Wilson, James
B. Ardrey, Ray Chung and M. Laurie Cummings). The actions (the "Securities
Actions") alleged that the defendants violated Sections 10(b) and/or

                                       11
<PAGE>

Section 20(a) of the Securities Exchange Act and Rule 10b-5 promulgated
thereunder. The Securities Actions complaints sought damages in unspecified
amounts. These Securities Actions purported to be brought on behalf of
purchasers of the Company's securities during various periods, all of which fell
between October 28, 1998 and April 2, 2000.

     On April 14, 2000, certain of the Company's current and former directors
were named as defendants in a derivative lawsuit filed in the Superior Court of
the State of California, in the County of San Francisco, alleging breach of
fiduciary duty, mismanagement and related causes of action based upon the
Company's restatement of its financial statements. The case was then removed to
federal court in San Francisco.

     On January 16, 2001 the Company announced that it reached a preliminary
agreement to settle the securities class action and derivative lawsuits pending
against the Company and its former management team in the U.S. District Court in
the Northern District of California. On March 1, 2001, Stipulations of
Settlement for the Securities class action and derivative lawsuits were entered
into in the U.S. District Court in the Northern District of California to fully
resolve, discharge and settle the claims made in each respective. On May 11,
2001, the United States District Court for the Northern District of California
approved the settlement.

     Under the terms of the agreement, Aurora will pay the class members $26
million in cash and $10 million in common stock of the Company.  On March 2,
2001, the Company entered into definitive agreements with certain members of
former management to transfer between approximately 3 million and 3.6 million
shares of common stock of the Company to the Company, in consideration for a
resolution of any civil claims that the Company may have, and partially
conditioned upon future events and circumstances.  The cash component of the
settlement will be funded entirely by the Company's insurance.  As of August 3,
2001, with respect to the common stock component of the settlement, the stock
received from former management would be sufficient, at current share prices, to
satisfy Aurora's obligation without issuing additional shares.  The actual
number of shares of common stock of the Company needed to fund this component
will be based on average share prices, some of which will be determined at later
dates.  However, members of the class had the opportunity to opt out of the
settlement agreement, and bring separate claims against the Company.  Separate
claims representing an immaterial number of shares did opt out of the settlement
agreement.

     Pursuant to the settlement and the definitive agreements, the Company
received 3,051,303 shares of its common stock from former management.  During
May, 2001, the Company distributed 465,342 shares of its common stock as
settlement for the first $2.5 million of the common stock component of the
settlement.  The number of shares of common stock to be distributed as
settlement for the remaining $7.5 million portion of the common stock component
of the settlement will be determined at a later date.  As of August 3, 2001, the
Company expects that the stock received or to be received from former management
will be sufficient to satisfy the Company's obligation without issuing
additional shares.

     In addition, the Company has agreed to continue to implement certain
remedial measures, including the adoption of an audit committee charter, the
reorganization of the Company's finance department, the establishment of an
internal audit function and the institution of a compliance program, as
consideration for resolution of the derivative litigation.

     The staff of the Securities and Exchange Commission (the "SEC") and the
United States Attorney for the Southern District of New York (the "U.S.
Attorney") also initiated investigations relating to the events that resulted in
the restatement of the Company's financial statements for prior periods ("Prior
Events").  The SEC and the U.S. Attorney requested that the Company provide
certain documents relating to the Company's historical financial statements.  On
September 5, 2000, the Company received a subpoena from the SEC to produce
documents in connection with the Prior Events.  The SEC also requested certain
information regarding some of the Company's former officers and employees,
correspondence with the Company's auditors and documents related to financial
statements, accounting policies and certain transactions and business
arrangements.

     On January 23, 2001 the U.S. Attorney announced indictments alleging
financial accounting fraud against members of former management and certain
former employees of the Company. The U.S. Attorney did not bring charges against
the Company.

                                       12
<PAGE>

     In a cooperation agreement with the U.S. Attorney, the Company confirmed
that it would continue to implement an extensive compliance program, which will
include an internal audit function, a corporate code of conduct, a comprehensive
policies and procedures manual, employee training and education on policies and
procedures and adequate disciplinary mechanisms for violations of policies and
procedures.

     In addition, the Company consented to the entry of an order by the SEC
requiring compliance with requirements for accurate and timely reporting of
quarterly and annual financial results, and the maintenance of internal control
procedures in connection with a civil action by the SEC concerning accounting
irregularities at the Company in 1998 and 1999.  Aurora did not either admit or
deny any wrongdoing, and the SEC did not seek any monetary penalty.  The Company
also committed to continue to cooperate with the SEC in connection with its
actions against certain former members of management and former employees.

     The Company is also the defendant in an action filed by a former employee
in the U.S. District Court for the Eastern District of Missouri.  The plaintiff
alleges breach of contract, fraud and negligent misrepresentation as well as
state law securities claims.  The Company intends to defend these claims
vigorously.

     The Company is also subject to litigation in the ordinary course of
business.

     In the opinion of management, the ultimate outcome of any existing
litigation would not have a material adverse effect on the Company's financial
condition, results of operations or cash flows.


NOTE 7 - PREFERRED DIVIDENDS

     Dividends on the outstanding Series A Convertible Cumulative Preferred
Stock are being accrued each period, but are not being paid in cash.  Preferred
dividends will be paid in additional preferred stock until such time as the
restrictions on payment of dividends contained in the senior secured debt
agreements are no longer in effect, at which time the Company will determine
whether future dividends will be paid in cash or additional shares of preferred
stock.

NOTE 8 - DERIVATIVE INSTRUMENTS

Adoption of SFAS 133

     The Company adopted Statement of Financial Accounting Standards (SFAS) No.
133, "Accounting for Derivative Instruments and Hedging Activities," as amended
by SFAS No. 137 and SFAS No. 138 (collectively the Statement), on January 1,
2001.  The Statement requires that all derivative instruments be recorded on the
balance sheet at their fair value, with changes in the fair value of the
derivative instruments to be recorded in current earnings or deferred in other
comprehensive income, depending on whether a derivative is designated as and is
effective as a hedge and on the type of hedging transaction.  In accordance with
the Statement, upon adoption the Company deferred hedging losses on designated
cash flow hedges of $2.3 million, which are net of tax of $1.4 million, to
accumulated other comprehensive losses.  Additionally, the Company recognized
the fair value of its fair value hedge as a $1.1 million liability within the
balance sheet.  The Company records the ineffectiveness of its hedges currently
in its statement of operations and those amounts were immaterial during the
quarter ended March 31, 2001.

     During the quarter ended June 30, 2001, one of the Company's cash flow
hedges and the Company's fair value hedge became ineffective, following the
significant reductions in interest rates from which the Company otherwise
benefits due to variable interest rates on its senior secured debt.  As a
result, on June 30, 2001 the Company recorded an additional charge to interest
expense of approximately $4.9 million representing the net previously deferred
expense and additional liability arising during the second quarter of 2001,
associated with these two derivatives.

                                       13
<PAGE>

Cash Flow Hedge

     At June 30, 2001, the Company used an interest-rate swap to convert a
portion of its variable-rate debt to fixed rates to comply with provisions of
its senior lending agreement.

     As of June 30, 2001, the Company had deferred hedging losses in accumulated
other comprehensive income on designated cash flow hedges of $2.2 million, which
is net of tax of $1.4 million.

NOTE 9 - OTHER COMPREHENSIVE LOSS


     The components of total comprehensive loss for the three and six month
periods ended June 30, 2001 and 2000 were as follows (in thousands):

<TABLE>
<CAPTION>
                                                                  Three months              Six months
                                                                 ended June 30,           ended June 30,
                                                              --------------------     ---------------------
                                                               2001         2000         2001         2000
                                                              -------     --------     --------     --------
                                                                                (unaudited)
<S>                                                           <C>         <C>          <C>          <C>
Net Loss...................................................   $(8,998)    $(18,883)    $(16,755)    $(47,543)
                                                              -------     --------     --------     --------

Other comprehensive income (loss), net of tax:
   Adoption of FAS 133 for hedging activities..............         -            -       (2,277)           -
   Loss deferred on qualifying cash flow hedges............       (31)           -         (900)           -
   Reclassification adjustment for cash flow
     hedging losses realized in net income.................       936            -          936            -
                                                              -------     --------     --------     --------

Total other comprehensive income (loss)....................       905            -       (2,241)           -
                                                              -------     --------     --------     --------

   Total comprehensive loss................................   $(8,093)    $(18,883)    $(18,996)    $(47,543)
                                                              =======     ========     ========     ========
</TABLE>

                                       14
<PAGE>

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

     Reference is made to Notes to Financial Statements and Management's
Discussion and Analysis of Financial Condition and Results of Operations
presented in the annual report on Form 10-K of Aurora Foods Inc. for the year
ended December 31, 2000.

     The following discussion and analysis of the Company's financial condition
and results of operations should be read in conjunction with the historical
financial information included in the Financial Statements and notes to the
financial statements in Item 1 included herein.  Unless otherwise noted, years
(2001 and 2000) in this discussion refer to the Company's three and six month
periods ending on June 30, respectively.

                                       15
<PAGE>

Results of Operations Three Months Ended June 30

     The following table sets forth the results of operations for the periods
indicated as well as the percentage which the items in the Statements of
Operations bear to net sales.

                               AURORA FOODS INC.
                           STATEMENTS OF OPERATIONS
                       (Dollars and shares in thousands)
                                  (unaudited)

<TABLE>
<CAPTION>
                                                                                  Three Months Ended June 30,
                                                                        ---------------------------------------------------
                                                                                  2001                         2000
                                                                        -----------------------      ----------------------
<S>                                                                     <C>             <C>          <C>            <C>
Net sales............................................................   $ 219,898       100.0 %      $ 214,721     100.0 %
Cost of goods sold...................................................    (108,904)      (49.5)        (101,458)    (47.3)
                                                                        ---------       ------       ---------     ------
    Gross profit.....................................................     110,994        50.5          113,263      52.7
                                                                        ---------       ------       ---------     ------
Brokerage, distribution and marketing expenses:
    Brokerage and distribution.......................................     (25,516)      (11.6)         (25,114)    (11.7)
    Trade promotions.................................................     (38,291)      (17.4)         (41,806)    (19.5)
    Consumer marketing...............................................      (4,876)       (2.2)          (8,293)     (3.8)
                                                                        ---------       ------       ---------     ------
      Total brokerage, distribution and marketing expenses...........     (68,683)      (31.2)         (75,213)    (35.0)
Amortization of goodwill and other intangibles.......................     (11,322)       (5.2)         (10,729)     (5.0)
Selling, general and administrative expenses.........................     (15,651)       (7.1)         (12,095)     (5.6)
Other financial, legal, accounting, consolidated and transition
  income (expense)...................................................       3,066         1.4          (15,056)     (7.0)
                                                                        ---------       ------       ---------     ------
      Total operating expenses.......................................     (92,590)      (42.1)        (113,093)    (52.6)
                                                                        ---------       ------       ---------     ------
    Operating income.................................................      18,404         8.4              170       0.1
Interest expense, net................................................     (30,362)      (13.8)         (27,126)    (12.6)
Amortization of deferred financing expense...........................        (867)       (0.4)            (735)     (0.4)
Other bank and financing expenses....................................         (37)       (0.0)            (101)     (0.0)
                                                                        ---------       ------       ---------     ------
    Loss before income taxes.........................................     (12,862)       (5.8)         (27,792)    (12.9)
Income tax benefit...................................................       3,864         1.7            8,909       4.1
                                                                        ---------       ------       ---------     ------
    Net loss.........................................................      (8,998)       (4.1)         (18,883)     (8.8)
Preferred dividends..................................................        (308)       (0.1)               -         -
                                                                        ---------       ------       ---------     ------
    Net loss available to common stockholders........................   $  (9,306)       (4.2)%      $ (18,883)     (8.8)%
                                                                        =========       ======       =========     ======
Basic and diluted loss per share available to common stockholders....   $   (0.13)                   $   (0.28)
                                                                        =========                    =========
EBIDTA (1)...........................................................   $  36,583        16.6 %      $  17,301       8.1 %
                                                                        =========       ======       =========     ======
Adjusted EBITDA (2)..................................................   $  33,517        15.2 %      $  32,356      15.1 %
                                                                        =========       ======       =========     ======
</TABLE>

(1) EBITDA represents earnings before interest, taxes, depreciation and
    amortization and before the accounting change. The Company believes EBITDA
    provides additional information for determining its ability to meet debt
    service requirements. EBITDA does not represent and should not be considered
    an alternative to net income or cash flow from operations as determined by
    generally accepted accounting principles. EBITDA does not necessarily
    indicate whether cash flow will be sufficient for cash requirements and
    should not be deemed to represent funds available to the Company. The
    calculation of EBITDA does not include the commitments of the Company for
    capital expenditures and payments of debt. EBITDA, as presented, may not be
    comparable to similarly-titled measures of other companies.

(2) Adjusted EBITDA is defined as EBIDTA plus other financial, legal,
    accounting, consolidation and transition income (expense).

     The Company manages its business in three operating segments, the retail,
food service and other distribution channels. The separate financial information
of each segment is presented consistently with the manner in which results are
evaluated by the chief operating decision-maker in deciding how to allocate
resources and in assessing performance.

                                       16
<PAGE>


Net sales by operating segment for the three month periods ended June 30, 2001
and 2000 were as follows (in thousands):

<TABLE>
<CAPTION>
                                     2001             2000
                                   ---------        ---------
<S>                                <C>              <C>
      Net Sales:                          (unaudited)
          Retail.................  $ 179,034        $ 178,475
          Food Service...........     16,490           16,281
          Other..................     24,374           19,965
                                   ---------        ---------
              Total..............  $ 219,898        $ 214,721
                                   =========        =========
</TABLE>

     Net sales increased $5.2 million or 2.4% to $219.9 million in 2001 from
$214.7 million in 2000.  In the retail segment, the overall sales increase was
led by net sales gains in syrups and mixes, with an increase of 18.5% over the
prior year and in baking mixes and frosting with an increase of 8.9% over 2000.
These increases were principally due to frosting and brownie product
introductions, along with better trade promotion planning, more efficient
spending by tying multiple products into promotions.  In addition, the prior
year included higher discounts on syrup products to support aggressive programs
and new product introductions.  These gains were offset in part primarily by
lower net sales of frozen and refrigerated bagels, due to consumption declines
and lower seafood sales, as a greater portion of the Lent season sales occurred
in the first quarter of the year as compared to 2000.  In addition, coupon costs
were generally higher than in 2000, which was at very low levels.  Food service
sales volumes increased, but were largely offset by product and customer mix.
Net sales to other distribution channels increased $4.4 million, principally due
to strong sales to club stores and favorable product and customer mix.

     Gross profit decreased $2.3 million to $111.0 million in 2001 from $113.3
million in the prior year.  Total variable margin was negatively impacted by
segment mix, with a higher percentage of total sales in the quarter being to the
lower margin food service and other channels.  The overall variable margin in
the retail segment declined as the volume increases were offset by the higher
coupon costs noted above and slightly higher costs for fish, flour and dairy
ingredients, offset in part by lower sugar costs. Gross profit was unfavorably
impacted by increased fixed manufacturing costs absorbed as a result of lower
production levels required to generate significantly reduced inventory levels.

     Brokerage and distribution expenses increased $0.4 million to $25.5 million
in 2001 from $25.1 million in 2000.  This increase was primarily due to the
increase in sales volume, offset in part by a reduction in retail brokerage
expense, as a result of the Company's consolidation to a national retail broker
in the second quarter of 2000. During the second quarter of 2001, this broker
filed for bankruptcy and the business was absorbed by Acosta, which the Company
selected as its new national retail broker. The change in brokers did cause some
disruption on selected brands, but did not have a significant impact on overall
results.

     Trade promotions expense decreased $3.5 million to $38.3 million in 2001
from $41.8 million in 2000.  This decrease was primarily in the retail segment
on baking mixes and frostings.  Sales in the second quarter of 2000 were
supported by heavy trade promotions.  In 2001, although some additional
discounts were given and reflected in net sales, overall net discounts and trade
spending have been reduced significantly through better planning and more
efficient spending, while still supporting strong volume growth.  In addition,
2000 included higher spending for new product introductions.

     Consumer marketing expenses decreased $3.4 million to $4.9 million in 2001
as compared to $8.3 million in 2000.  This decrease was principally due to
reduced levels of planned advertising in 2001 for syrups and baking mixes.

     Selling, general and administrative expenses increased to $15.7 million in
2001 from $12.1 million in 2000 primarily due to the increase in expenses for
new product trials and consulting to support product, production and internal
system initiatives along with increases in salaries, recruiting and relocation
expenses required to properly staff the organization.

     Other financial, legal, accounting, consolidation and transition income
(expense).  During the second quarter of 2001, the Company recorded a pretax
gain of approximately $3.8 million related to the receipt of shares from former
management in excess of amounts required to be distributed.  In addition, the
Company recorded

                                      17
<PAGE>

additional reserves of approximately $0.7 million related to unused office space
in Columbus, Ohio subsequent to the administrative consolidation in 2000. See
Note 3 to the financial statements of Part I, Item 1 of this Form 10-Q.

     During 2000, as a result of the investigation into the Company's past
accounting practices, the resulting restatement of its financial statements,
litigation, governmental proceedings, defaults under its loan agreements and
related matters, the Company incurred financial, legal and accounting expenses,
charges to obtain waivers on its events of default and charges related to
amending its financing facilities. Such costs, which totaled $8.5 million for
the three months ended June 30, 2000, were expensed when incurred by the
Company.  In addition, during the second quarter of 2000, the Company recorded a
reserve and charge to expense of approximately $6.6 million, for costs
associated with the closing of its administrative office in Columbus, Ohio.

     Operating income increased to $18.4 million in 2001 from $0.2 million in
2000. Operating income in both 2001 and 2000 were affected by other financial,
legal, accounting, consolidation and transition items.  Excluding other
financial, legal, accounting, consolidation and transition items, operating
income increased $0.1 million in 2001.

     Interest and other financing expenses.  The aggregate of net interest
income and expense, amortization of loan fees and other bank and financing
expenses increased to $31.3 million in 2001 from $28.0 million in 2000.  This
increase was due to the recording of an additional $4.9 million of expense to
recognize the net liability to the Company of two derivative instruments which
became ineffective in the quarter, in accordance with FAS 133.  See Note 8 to
the financial statements included in Part I, Item 1. of this Form 10-Q.  This
was offset in part by lower interest costs resulting from lower levels of
outstanding debt and lower interest rates during the second quarter as compared
to the prior year.

     Income tax benefit.  The income tax benefit recorded in 2001 and 2000 was
30.0% and 32.1%, respectively, of the pretax loss.

                                       18
<PAGE>


Results of Operations Six Months Ended June 30

     The following table sets forth the results of operations for the periods
indicated as well as the percentage which the items in the Statements of
Operations bear to net sales.

                               AURORA FOODS INC.
                           STATEMENTS OF OPERATIONS
                       (Dollars and shares in thousands)
                                  (unaudited)

<TABLE>
<CAPTION>
                                                                                   Six Months Ended June 30,
                                                                     ---------------------------------------------------
                                                                               2001                         2000
                                                                     ----------------------      -----------------------
<S>                                                                  <C>           <C>           <C>           <C>
Net sales........................................................... $  503,490       100.0%     $  496,729       100.0%
Cost of goods sold..................................................   (242,838)      (48.2)       (239,860)      (48.3)
                                                                     ----------    --------      ----------    --------
     Gross profit...................................................    260,652        51.8         256,869        51.7
                                                                     ----------    --------      ----------    --------
Brokerage, distribution and marketing expenses:
     Brokerage and distribution.....................................    (58,429)      (11.6)        (59,077)      (11.9)
     Trade promotions...............................................    (91,815)      (18.2)        (96,207)      (19.4)
     Consumer marketing.............................................    (23,881)       (4.8)        (26,264)       (5.3)
                                                                     ----------    --------      ----------    --------
          Total brokerage, distribution and marketing expenses......   (174,125)      (34.6)       (181,548)      (36.6)
Amortization of goodwill and other intangibles......................    (22,523)       (4.5)        (21,480)       (4.3)
Selling, general and administrative expenses........................    (31,384)       (6.2)        (26,672)       (5.4)
Other financial, legal, accounting, consolidation and transition
     income (expense)..............................................       3,066         0.6         (26,022)       (5.2)
                                                                     ----------    --------      ----------    --------
          Total operating expenses..................................   (224,966)      (44.7)       (255,722)      (51.5)
                                                                     ----------    --------      ----------    --------
     Operating income...............................................     35,686         7.1           1,147         0.2
Interest expense, net...............................................    (58,232)      (11.6)        (51,547)      (10.4)
Amortization of deferred financing expense..........................     (1,734)       (0.3)         (1,443)       (0.3)
Other bank and financing expenses...................................        (74)       (0.0)           (188)       (0.0)
                                                                     ----------    --------      ----------    --------
     Loss before income taxes and cumulative effect of
          change in accounting......................................    (24,354)       (4.8)        (52,031)      (10.5)

Income tax benefit..................................................      7,599         1.5          16,649         3.4
                                                                     ----------    --------      ----------    --------
     Net loss before cumulative effect of change in accounting......    (16,755)       (3.3)        (35,382)       (7.1)
Cumulative effect of change in accounting, net of tax of $5,722.....          -           -         (12,161)       (2.5)
                                                                     ----------    --------      ----------    --------
     Net loss.......................................................    (16,755)       (3.3)        (47,543)       (9.6)
Preferred dividends.................................................       (615)       (0.1)              -           -
                                                                     ----------    --------      ----------    --------
     Net loss available to common stockholders...................... $  (17,370)       (3.4)%    $  (47,543)       (9.6)%
                                                                     ==========    ========      ==========    ========
Basic and diluted loss per share available to common stockholders:
     Loss before cumulative effect of change in accounting.......... $    (0.24)                 $    (0.53)
     Cumulative effect of change in accounting, net of tax..........          -                       (0.18)
                                                                     ----------                  ----------
     Net loss available to common stockholders...................... $    (0.24)                     $(0.71)
                                                                     ==========                  ==========
EBITDA (1).......................................................... $   71,620        14.2%     $   35,104         7.1%
                                                                     ==========    ========      ==========    ========
Adjusted EBITDA (2)................................................. $   68,554        13.6%     $   61,125        12.3%
                                                                     ==========    ========      ===========   ========
</TABLE>

(1)  EBITDA represents earnings before interest, taxes, depreciation and
     amortization and before the accounting change. The Company believes EBITDA
     provides additional information for determining its ability to meet debt
     service requirements. EBITDA does not represent and should not be
     considered an alternative to net income or cash flow from operations as
     determined by generally accepted accounting principles. EBITDA does not
     necessarily indicate whether cash flow willbe sufficient for cash
     requirements and should not be deemed to represent funds available to the
     Company. The calculation of EBITDA does not include the commitments of the
     Company for capital expenditures and payment of debt. EBITDA, as presented,
     may not be comparable to similar-titled measures of other companies.

(2)  Adjusted EBITDA is defined as EBITDA plus other financial, legal,
     accounting, consolidation and transition (expense).

                                       19
<PAGE>

Net sales by operating segment for the six month periods ended June 30, 2001 and
2000 were as follows (in thousands):

                                              2001         2000
                                            --------     --------
                                                 (unaudited)
     Net sales:
         Retail...........................  $418,678     $417,311
         Food Service.....................    32,308       32,193
         Other............................    52,504       47,225
                                            --------     --------
               Total......................  $503,490     $496,729
                                            ========     ========


     Net sales increased $6.8 million or 1.4% to $503.5 million in 2001 from
$496.7 million in 2000. In the retail segment, the overall sales increase was
led by net sales gains in baking mixes and frosting with an increase of 10.6%
over 2000, and Van de Kamp's(R) and Mrs. Paul's(R) seafood, with sales
increasing 6.9% from the prior year. These increases were principally due to new
product introductions and new consumer advertising and promotion. These gains
were substantially offset in part by lower net sales of frozen and refrigerated
bagels, due to consumption declines, and sales declines in syrups. Syrup sales
in 2000 included a product introduction and heavy trade spending to drive
volume. Significantly lower trade spending and couponing on syrups in 2001
reduced unit volumes, however, total product contribution increased. Food
service sales volumes increased, but were offset by product and customer mix.
Net sales to other distribution channels increased $5.3 million, principally due
to product and customer mix.

     Gross profit increased $3.8 million to $260.7 million in 2001 from $256.9
million in the prior year. Total variable margin in the retail segment declined
slightly due to the sales declines in bagels and syrups. These were offset by
the volume increases in baking and seafood and lower levels of seafood
discounts. However, slightly higher price discounts on baking mixes, in lieu of
significant reductions in performance based trade promotion programs lowered
overall gross profit. Gross profit was also favorably impacted by improved plant
efficiencies and a one-time gain associated with the renegotiation of employee
benefits at the West Seneca, New York facility, offset in part by increased
consulting costs associated with obtaining the plant efficiencies and increased
fixed manufacturing costs absorbed as a result of lower production levels
required to generate significantly reduced inventory levels.

     Brokerage and distribution expenses decreased $0.6 million to $58.4 million
in 2001 from $59.1 million in 2000. This decrease was primarily due to a
reduction in retail brokerage expense, as a result of the Company's
consolidation to a national retail broker in the second quarter of 2000. During
the second quarter of 2001, this broker filed for bankruptcy and the business
was absorbed by Acosta, which the Company selected as its new national retail
broker. The change in brokers did cause some disruption on selected brands, but
did not have a significant impact on overall results.

     Trade promotions expense decreased to $91.8 million in 2001 from $96.2
million in 2000. This decrease was primarily in the retail segment. Spending on
retail baking mixes and frostings along with syrups was reduced from the prior
year, as a result of better trade promotion planning, more efficient spending by
tying multiple products into promotions and higher prior year syrup spending to
support aggressive programs and new product introductions. This was offset in
part by increased performance-based trade promotions on seafood to support sales
during Lent, where lower levels of up-front discounts to customers, reflected in
net sales and gross profit, were given in 2001.

     Consumer marketing expenses were $23.9 million in 2001 as compared to $26.3
million in 2000. This decrease was due to the higher levels of spending in 2000
on breakfast and syrup products to support product introduction and placement of
coupons. These were offset in part by higher spending in 2001, principally for
seafood and baking mixes and frosting, supporting the brands and new product
introductions.

     Selling, general and administrative expenses increased to $31.4 million in
2001 from $26.7 million in 2000 primarily due to the increase in expenses for
new product trials and consulting to support product, production and internal
system initiatives along with increases in salaries, recruiting and relocation
expenses required to properly staff the organization.

                                      20
<PAGE>

     Other financial, legal, accounting, consolidation and transition income
(expense).  During the second quarter of 2001, the Company recorded a pretax
gain of approximately $3.8 million gain related to the receipt of shares from
former management in excess of amounts required to be distributed.  In addition,
the Company recorded additional reserves of approximately $0.7 million related
to unused office space in Columbus, Ohio subsequent to the administrative
consolidation in 2000.  See Note 3 to the financial statements of Part I, Item 1
of this Form 10-Q.

     During 2000, as a result of the investigation into the Company's past
accounting practices, the resulting restatement of its financial statements,
litigation, governmental proceedings, defaults under its loan agreements and
related matters, the Company incurred financial, legal and accounting expenses,
charges to obtain waivers on its events of default and charges related to
amending its financing facilities. Such costs, which totaled $18.1 million for
the six months ended June 30, 2000, were expensed when incurred by the Company.
In addition, during the second quarter of 2000, the Company recorded a reserve
and charge to expense of approximately $6.6 million, for costs associated with
the closing of its administrative office in Columbus, Ohio and incurred $1.4
million in transition expenses, primarily due to the integration of the Chef's
Choice(R) and Lender's(R) businesses.  These expenses represented one-time costs
incurred to integrate acquired businesses and operations.

     Operating income increased to $35.7 million in 2001 from $1.1 million in
2000. Operating income in both 2001 and 2000 were affected other financial,
legal, accounting, consolidation and transition items. Before giving effect to
these items, operating income increased $5.5 million in 2001.

     Interest and other financing expenses.  The aggregate of net interest
income and expense, amortization of loan fees and other bank and financing
expenses increased to $60.0 million in 2001 from $53.2 million in 2000. The
increase was due primarily to costs associated with the accounts receivable sale
facility and with debt agreement amendments along with the recording of an
additional $4.9 million of expense to recognize the net liability to the Company
of two derivative instruments which became ineffective in the quarter, in
accordance with FAS 133.  See Note 8 to the financial statements included in
Part I, Item 1. of this Form 10-Q.  This was offset in part by lower interest
costs resulting from lower levels of outstanding debt and lower interest rates
during the second quarter as compared to the prior year.

     Income tax benefit.  The income tax benefit recorded in 2001 and 2000 was
31.2% and 32.0%, respectively, of the pretax loss.

     Cumulative effect of change in accounting.  Effective January 1, 2000, the
Company adopted the consensus reached in EITF 00-14, Accounting for Certain
Sales Incentives.  See Note 1 to the financial statements in Part I, Item 1 of
this Form 10-Q.


Liquidity and Capital Resources

     For the six months ended June 30, 2001 the Company generated $37.2 million
from operating activities compared to the six months ended June 30, 2000, when
$32.0 million of cash was used in operations. The increase in cash provided in
2001 was primarily a result of the lower net loss incurred during the period,
including a $29.1 million change in other financial, legal, accounting,
consolidation and transition items from 2000 and a significant change in funds
related to working capital changes.  As of June 30, 2001, the Company had
received a net $28.7 million from the sale of accounts receivable.  The
agreement to sell accounts receivable has been used to provide needed cash.

     Investing activities during the six months ended June 30, 2001 used $5.3
million for asset additions.  The reduction in 2001 from amounts used for asset
additions in 2000 results principally from the timing of capital projects during
the year.  In addition, 2000 included the use of cash to complete the 1999
purchase of Sea Coast Foods, Inc.

     During the six months ended June 30, 2001, financing activities used cash
of $29.8 million primarily for debt repayments.  In 2000, the Company repaid
$11.5 million in principal on its senior secured term debt and borrowed $65.0
million on the revolving facility to fund its operations, capital expenditures,
software and packaging design expenditures, and its repayment of borrowings.

                                       21
<PAGE>

     In February, 2001, the Company's senior secured debt agreement was amended
 to provide revised financial covenants for 2001, to affirm the ability of the
 Company to continue to sell up to $60 million of accounts receivable, to
 increase the interest rate spread on borrowings by 0.25% and to provide for a
 further increase in the interest rate spread of 0.25% if asset sale proceeds
 and related repayments of debt between February 1, 2001 and June 30, 2001 were
 less than $90 million. In addition, the accounts receivable sale facility was
 amended to extend the termination date to March 31, 2002 and effectively reduce
 the available facility to $46 million as of March 31, 2001 and $36 million as
 of December 31, 2001. As of June 30, 2001, the Company had $23.6 million
 available for borrowings under its revolving credit facility. Cash available
 under this facility fluctuates significantly on a daily basis. The Company did
 not complete any asset sales prior to June 30, 2001. As a result, the interest
 rate on its floating rate senior debt facility increased 0.25% on July 1, 2001,
 which will offset in part the benefit it has been receiving from the decline in
 interest rates during 2001.

     The Company is highly leveraged. At June 30, 2001, the Company had
outstanding approximately $1.1 billion in aggregate principal amount of
indebtedness for borrowed money. The degree to which the Company is leveraged
results in significant cash interest expense and principal repayment obligations
and such interest expense may increase with respect to its senior debt based
upon changes in prevailing interest rates. This leverage may, among other
things, affect the ability of the Company to obtain additional financing, or
adjust to changing market conditions. In addition, the Company is currently
limited in its ability to pursue additional acquisitions.

     Management of the Company believes that cash generated from operations and
cash available to the Company from the sale of accounts receivable and
borrowings under the revolving credit agreement will be adequate in 2001 to fund
its operating and capital expenditure requirements and its debt repayment
obligations.

Impact of New Accounting Pronouncements

     In April, 2001, the Emerging Issues Task Force reached consensus on EITF
No. 00-25, Accounting for Consideration from a Vendor to a Retailer in
Connection with the Purchase or Promotion of the Vendor's Products.  Although
the Company has not yet quantified the impact of this change in accounting,
management expects that adoption of this consensus will require that certain
expenses, currently classified as trade promotion expense, will be required to
be reclassified as reductions of net sales, with no effect on the reported
amount of operating income.  Adoption of the change will be required in
financial statements issued by the Company in 2002, and prior periods' financial
statements will be restated to conform with the new presentation.

     In late June 2001, the FASB approved the issuance of FAS 142, Goodwill and
Other Intangible Assets which, for the Company, will be required as of January
1, 2002.  Although the Company has not yet reviewed the statement in detail or
quantified the impacts, management expects that the adoption of the new
pronouncement will result in decreases in the ongoing amount of amortization of
goodwill and other intangible assets reflected in the Company's statements of
operations in future periods.

Interest Rate Collar Agreements

     At June 30, 2001, the Company was party to three interest rate swap
agreements. The Company entered into these agreements as a means of managing its
interest rate risk. Risks associated with the interest rate swap and collar
agreements include those associated with changes in the market value and
interest rates. Management considers the potential loss in future earnings and
cash flows attributable to the interest rate swap and collar agreements to not
be material.  See Note 8 to the financial statements.

Forward-Looking Statements

     The Private Securities Litigation Reform Act of 1995 provides a safe harbor
for forward-looking statements made by or on behalf of the Company. The Company
and its representatives may from time to time make written or oral statements
that are "forward-looking" including statements contained in this report and
other filings with the Securities and Exchange Commission and in reports to the
Company's stockholders. Certain statements, including, without limitation,
statements containing the words "believes," "anticipates," "intends," "expects,"
"estimates" and words of similar import constitute "forward-looking statements"
and involve known and unknown risk, uncertainties and other factors that may
cause the actual results, performance or achievements of the Company to be
materially

                                       22
<PAGE>

different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors could include, among
others, the following: the availability of funding for operations; the ability
of the Company to service its high level of indebtedness; the ability of new
management to implement a successful strategy; the ability of the Company to
successfully integrate the Company's brands; whether the Company can increase
its competitive position in the marketplace; the ability of the Company to
reduce expenses; the ability of the Company to successfully introduce new
products; the Company's success in increasing volume; the effectiveness of the
Company's advertising campaigns; the ability of the Company to successfully
leverage its brands; the ability of the Company to secure new, effective
distribution channels; the ability of the Company to grow and maintain its
market share; the actions of the Company's competitors; general economic and
business conditions; industry trends; demographics; raw material costs;
integration of acquired businesses into the Company; terms and development of
capital; the ability of the Company to realize the value of its deferred tax
assets; the outcome of the Securities Actions; and changes in, or the failure or
inability to comply with, governmental rules and regulations, including, without
limitation, FDA and environmental rules and regulations. See "--Liquidity and
Capital Resources." Given these uncertainties, undue reliance should not be
placed on such forward-looking statements. Unless otherwise required by law, the
Company disclaims an obligation to update any such factors or to publicly
announce the results of any revisions to any forward-looking statements
contained herein to reflect future events or developments.


ITEM 3:  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

     The Company has entered into interest rate swap and collar agreements for
non-trading purposes. Risks associated with the interest rate swap and collar
agreements include those associated with changes in the market value and
interest rates. Management considers the potential loss in future earnings and
cash flows attributable to the interest rate swap and collar agreements not to
be material.  See Note 8 to the financial statements.

                                       23
<PAGE>

PART II--OTHER INFORMATION

ITEM 1:   LEGAL PROCEEDINGS

     During 2000, the Company was served with eighteen complaints in purported
class action lawsuits filed in the U.S. District Court for the Northern District
of California. The complaints received by the Company alleged that, among other
things, as a result of accounting irregularities, the Company's previously
issued financial statements were materially false and misleading and thus
constituted violations of federal securities laws by the Company and the
directors and officers who resigned on February 17, 2000 (Ian R. Wilson, James
B. Ardrey, Ray Chung and M. Laurie Cummings). The actions (the "Securities
Actions") alleged that the defendants violated Sections 10(b) and/or Section
20(a) of the Securities Exchange Act and Rule 10b-5 promulgated thereunder. The
Securities Actions complaints sought damages in unspecified amounts. These
Securities Actions purported to be brought on behalf of purchasers of the
Company's securities during various periods, all of which fell between October
28, 1998 and April 2, 2000.

     On April 14, 2000, certain of the Company's current and former directors
were named as defendants in a derivative lawsuit filed in the Superior Court of
the State of California, in the County of San Francisco, alleging breach of
fiduciary duty, mismanagement and related causes of action based upon the
Company's restatement of its financial statements. The case was then removed to
federal court in San Francisco.

     On January 16, 2001 the Company announced that it reached a preliminary
agreement to settle the securities class action and derivative lawsuits pending
against the Company and its former management team in the U.S. District Court in
the Northern District of California. On March 1, 2001, Stipulations of
Settlement for the Securities class action and derivative lawsuits were entered
into in the U.S. District Court in the Northern District of California to fully
resolve, discharge and settle the claims made in each respective. On May 11,
2001, the United States District Court for the Northern District of California
approved the settlement.

     Under the terms of the agreement, Aurora will pay the class members $26
million in cash and $10 million in common stock of the Company.  On March 2,
2001 the Company entered into definitive agreements with certain members of
former management to transfer to the Company between approximately 3 million and
3.6 million shares of common stock of the Company, in consideration for a
resolution of any civil claims that the Company may have, and partially
conditioned upon future events and circumstances.  The cash component of the
settlement will be funded entirely by the Company's insurance.  As of August 3,
2001, with respect to the common stock component of the settlement, the stock
received from former management would be sufficient, at current share prices, to
satisfy Aurora's obligation without issuing additional shares.  The actual
number of shares of common stock of the Company needed to fund this component
will be based on average share prices, some of which will be determined at later
dates. However, members of the class had the opportunity to opt out of the
settlement agreement, and bring separate claims against the Company.  Separate
claims representing an immaterial number of shares did opt out of the settlement
agreement.

     Pursuant to the settlement and the definitive agreements, the Company
received 3,051,303 shares of its common stock from former management.  During
May, 2001, the Company distributed 465,342 shares of its common stock as
settlement for the first $2.5 million of the common stock component of the
settlement.  The number of shares of common stock to be distributed as
settlement for the remaining $7.5 million portion of the common stock component
of the settlement will be determined at a later date.

     In addition, the Company has agreed to continue to implement certain
remedial measures, including the adoption of an audit committee charter, the
reorganization of the Company's finance department, the establishment of an
internal audit function and the institution of a compliance program, as
consideration for resolution of the derivative litigation.

     The staff of the Securities and Exchange Commission (the "SEC") and the
United States Attorney for the Southern District of New York (the "U.S.
Attorney") also initiated investigations relating to the events that resulted in
the restatement of the Company's financial statements for prior periods ("Prior
Events").  The SEC and U.S. Attorney requested that the Company provide certain
documents relating to the Company's historical financial statements.  On
September 5, 2000, the Company received a subpoena from the SEC to produce
documents in

                                       24
<PAGE>

connection with the Prior Events. The SEC also requested certain information
regarding some of the Company's former officers and employees, correspondence
with the Company's auditors and documents related to financial statements,
accounting policies and certain transactions and business arrangements.

     On January 23, 2001 the U.S. Attorney announced indictments alleging
financial accounting fraud against members of former management and certain
former employees of the Company. The U.S. Attorney did not bring charges against
the Company.

     In a cooperation agreement with the U.S. Attorney, the Company confirmed
that it would continue to implement an extensive compliance program, which will
include an internal audit function, a corporate code of conduct, a comprehensive
policies and procedures manual, employee training and education on policies and
procedures and adequate disciplinary mechanisms for violations of policies and
procedures.

     In addition, the Company consented to the entry of an order by the SEC
requiring compliance with requirements for accurate and timely reporting of
quarterly and annual financial results, and the maintenance of internal control
procedures in connection with a civil action by the SEC concerning accounting
irregularities at the Company in 1998 and 1999. Aurora did not either admit or
deny any wrongdoing, and the SEC did not seek any monetary penalty. The Company
also committed to continue to cooperate with the SEC in connection with its
actions against certain former members of management and former employees.

     The Company is also the defendant in an action filed by a former employee
in the U.S. District Court for the Eastern District of Missouri. The plaintiff
alleges breach of contract, fraud and negligent misrepresentation as well as
state law securities claims. The Company intends to defend these claims
vigorously.

     The Company is also subject to litigation in the ordinary course of
business.

     In the opinion of management, the ultimate outcome of any existing
litigation would not have a material adverse effect on the Company's financial
condition, results of operations or cash flows.

                                       25
<PAGE>

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

     At the Company's annual meeting on June 5, 2001, shareholders voted for the
election of all nominees for the Board of Directors and to approve the amendment
of the 1998 Employee Stock Purchase Plan, which included increasing the shares
available under the plan from 200,000 to 400,000 shares, as described in the
Company's Proxy Statement for such meeting.

Vote tabulations were as follows:

<TABLE>
<CAPTION>
Board of Directors

       Name                    For           Against          Withheld
------------------         ----------        -------          --------
<S>                        <C>              <C>             <C>
Clive A. Apsey             52,794,691              -           76,859
David E. DeLeeuw           52,791,053              -           80,497
Charles J. Delaney         52,794,328              -           77,222
Richard C. Dresdale        52,794,528              -           77,022
Andrea Geisser             52,747,279              -          124,271
Peter Lamm                 52,792,078              -           79,472
George E. McCown           52,793,203              -           78,347
Ronald S. Orr              52,803,558              -           67,992
James T. Smith             52,775,926              -           95,624
Christopher T. Sortwell    52,771,097              -          100,453

Amendment of the 1998 Employee Stock Purchase Plan:

                               For           Against         Abstained
                           ----------        -------         ---------
                           52,696,327        151,420           23,803


</TABLE>
                                       26


<PAGE>

ITEM 6:   EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

      Exhibit
      -------
       Number                 Exhibit
       ------                 -------

       10.44   Collective Bargaining Agreement between Aurora Foods Inc. and
               the Bakery, Confectionery, Tobacco Workers & Grain Millers'
               International Union of America, Local 429, dated January 12,
               2001.

(b) Reports on Form 8-K

Date Filed

April 23, 2001  Press release dated April 23, 2001 with respect to results for
                the first quarter ended March 31, 2001.

May 14, 2001    Press release dated May 11, 2001 announcing that the U.S.
                District Court in the Northern District of California confirmed
                the settlement of all class action and derivative suits brought
                against the Company relating to the earnings restatements
                announced in February 2000.

                                      27
<PAGE>

SIGNATURES

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


                                       AURORA FOODS INC.


                                       By:    /s/ Christopher T. Sortwell
                                              ---------------------------

                                              Christopher T. Sortwell
                                              Chief Financial Officer
                                              (Duly Authorized Officer,
                                              Principal Financial Officer and
                                              Principal Accounting Officer)


Date: August 13, 2001

                                       28
<PAGE>

                                 EXHIBIT INDEX

          Exhibit
          -------
          Number                 Exhibit
          ------                 -------

          10.44  Collective Bargaining Agreement between Aurora Foods Inc. and
                 the Bakery, Confectionery, Tobacco Workers & Grain Millers'
                 International Union of America, Local 429, dated January 12,
                 2001.

                                       29