SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                               FORM 10-QSB

                              Quarterly Report Under Section 13 or 15(d) of the
                                          Securities Exchange Act of 1934



                                         For Quarter Ended:  June 30, 1998

                                            Commission File No. 1-10825


                                            NEW GENERATION FOODS, INC.

              -----------------------------------------------------------------
              (Exact name of small business issuer as specified in its charter)

               Nevada                                               36-2972588
              -----------------------------------------------------------------
(State of Incorporation)                   (I.R.S. Employer Identification No.)


                                                  9 Dunham Avenue
                                             Scarsdale, New York 10583
              -----------------------------------------------------------------
                                      (Address of Principal Executive Office)
                                                    (Zip Code)

Issuer's telephone number, including area code (914) 722-2410

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

                                    Yes   X                   No

Common stock $.01 par value -- 399,830 shares outstanding as of June 30, 1998.

                                                    Page 1 of 9


<PAGE>



                   NEW GENERATION FOODS, INC. AND SUBSIDIARIES
                           Consolidated Balance Sheets
                       June 30, 1998 and December 31, 1997

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

-------------------------------------------------------------------------------
<TABLE>
<CAPTION>

                                                                 June 30, 1998            Dec. 31, 1997
                                                                    Unaudited                 Audited
<S>                                                               <C>                     <C>

ASSETS
Current Assets:
    Cash and cash equivalents                                           $79,695             $1,399,274
    Marketable investment security at market value                          792                    777
                                                                            ---                    ---
TOTAL ASSETS                                                            $80,487            $1,400,051
                                                                        =======           ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
(Deficit)
Current Liabilities:
    Accounts payable-shareholder                                             $-               $460,000
    Dividends payable                                                         -                840,000
    Accrued franchise taxes                                              45,200                 45,200
    Accrued expenses                                                        784                    784
                                                                            ---                    ---
                    Total current liabilities                            45,984              1,345,984
                                                                         ======              =========

Redeemable  Convertible Voting Senior Preferred Stock, $.01 par value (stated at
liquidation value of $1.00 per share). Authorized 2,333,333 shares;
issued and outstanding 1,100,000 shares                               1,100,000              1,100,000
                                                                      ---------              ---------




Stockholders' Equity (Deficit)
Common stock, $.01 par value. Authorized
25,000,000 shares; issued and outstanding 399,830                         3,998                  3,998


Additional paid-in capital                                           22,818,930             22,818,930
Retained deficit                                                   (23,888,425)           (23,868,861)
                                                                    ----------             ----------
                   Total stockholders' equity (deficit)             (1,065,497)            (1,045,933)
                                                                     ---------              ---------

TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT)                                                        $80,487             $1,400,051
                                                                        =======              =========   
</TABLE>

<PAGE>

                   NEW GENERATION FOODS, INC. AND SUBSIDIARIES
                      Consolidated Statements of Operations
                For the three months ended June 30, 1998 and 1997
                                   (Unaudited)

<TABLE>
<CAPTION>


                                                                                  1998                     1997
                                                                                  ----                     ----

<S>                                                                              <C>                      <C>

OPERATING EXPENSES
    Selling, general and administrative                                           $23,980                  $47,309
                                                                                  -------                  -------
          Total operating expenses                                                 23,980                   47,309
                                                                                  -------                  -------
          Operating loss                                                         (23,980)                 (47,309)
                                                                                  -------                  -------

OTHER INCOME (DEDUCTIONS)
    Interest and dividend income                                                    1,265                   22,742
    Loss on investments                                                                 -                 (12,607)
                                                                    ----------------------      -------------------
         Total other income (deductions)                                            1,265                   10,135
                                                                    ----------------------      -------------------

            Loss before income taxes                                             (22,715)                 (37,174)

INCOME TAXES                                                                            -                        -
                                                                    ----------------------      -------------------

NET LOSS                                                                        $(22,715)                $(37,547)
                                                                    ======================      ===================

Net loss per share of common stock - basic and diluted                            $(0.06)                  $(0.21)
                                                                                  =======                 ========
Weighted average number of common shares outstanding                              399,830                  399,830
                                                                                 ========                  =======

</TABLE>


No dividends were paid by the company during the three month periods ended June
30, 1998 and 1997.

See accompanying condensed notes to consolidated financial statements.


<PAGE>


                   NEW GENERATION FOODS, INC. AND SUBSIDIARIES
                      Consolidated Statements of Operations
                 For the six months ended June 30, 1998 and 1997
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                               1998                    1997
                                                                               ----                    ----

<S>                                                                            <C>                    <C>

OPERATING EXPENSES
    Selling, general and administrative                                       $25,693                 $87,275
                                                                             --------                 -------
          Total operating expenses                                             25,693                  87,275
                                                                             --------                  ------

          Operating loss                                                     (25,693)                (87,275)
                                                                             --------                --------

OTHER INCOME (DEDUCTIONS)
    Interest and dividend income                                                6,504                  46,961
    Loss on investments                                                             -                (15,619)
                                                                               ------                 -------
           Total other income (deductions)                                      6,504                  31,342
                                                                               ------                 -------

            Loss before income taxes                                         (19,189)                (55,933)

INCOME TAXES                                                                      375                     372
                                                                                  ---                     ---

NET EARNINGS LOSS                                                           $(19,564)               $(56,305)
                                                                            =========               =========

Net loss per share of common stock - basic and diluted                        $(0.05)                 $(0.37)
                                                                                ====                    ====
Weighted average number of common shares outstanding                          399,830                399,830
                                                                              =======                =======

</TABLE>

No dividends were paid by the company during the six month periods ended June
30, 1998 and 1997.

See accompanying condensed notes to consolidated financial statements.

<PAGE>

                   NEW GENERATION FOODS, INC. AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                 For the six months ended June 30, 1998 and 1997
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                            1998                           1997
                                                                            ----                           ----
<S>                                                                        <C>                            <C>

CASH FLOWS FROM OPERATING ACTIVITIES
     Net Loss                                                          $(19,564)                      $(56,305)
                                                                      ----------                      ---------

Adjustments to reconcile net income (loss)
to net cash provided by (used in)
operating activities:
     Depreciation                                                             -                          2,631
     Loss (gain) on marketable investment                                                            
     securities                                                             (15)                         4,609

Change in assets and liabilities:
     Decrease in receivables                                                  -                         13,161
     Decrease in accounts payable and
     accrued expenses                                               (1,300,000)                        (10,328)
                                                                    ------------                       --------
              Total adjustments                                     (1,300,015)                         10,073
                                                                    ------------                       -------
Net decrease in cash and cash                                       (1,319,579)                        (46,232)
equivalents

Cash and cash equivalents at beginning of period                      1,399,274                      1,963,394
                                                                     -----------                    ----------
Cash and cash equivalents at end of period                             $79,695                      $1,917,162
                                                                      =========                    ===========

</TABLE>

See accompanying condensed notes to consolidated financial statements.


<PAGE>



         NEW GENERATION FOODS, INC. AND SUBSIDIARIES
     Condensed Notes to Consolidated Financial Statements
                        (Unaudited)


(1) Basis of Presentation

The financial  information  is prepared in conformity  with  generally  accepted
accounting principles and such principles are applied on a basis consistent with
those reflected in the 1997 annual report filed with the Securities and Exchange
Commission.  The  financial  information  included  herein has been  prepared by
management.  The  consolidated  balance  sheet as of December  31, 1997 has been
derived from, and does not include, all the disclosures contained in the audited
financial statements for the year ended December 31, 1997.

The information  furnished includes all adjustments and accruals consisting only
of normal recurring accrual adjustments which are, in the opinion of management,
necessary for a fair statement of results for the interim periods.

Results of operations for the six month periods ended June 30, 1998 and 1997 are
not necessarily indicative of the results of a full year.

These  financial  statements  should be read in  conjunction  with the Company's
consolidated financial statements included in the December 31, 1997 Form 10- KSB
Report.  Management  believes  that the  disclosures  are  adequate  to make the
information presented herein not misleading.

(2) Net income (loss) per share

Net income (loss) per share - basic is computed by dividing net income (loss) by
the weighted  average number of shares of common stock  outstanding  during each
period.  The 1997  computation  of dilutive net income (loss) per share excludes
the convertible  preferred stock and stock options because their inclusion would
have had an  antidilutive  effect.  In the fourth  quarter of 1997,  the Company
adopted Statement of Financial Accounting Standards No. 128, Earnings Per Share.
Net loss per share for the three  months and six months  ended June 30, 1997 has
been  restated to comply with  Statement of Financial  Accounting  Standards No.
128.

<PAGE>

                     NET INCOME (LOSS) PER SHARE COMPUTATION

                           Three Months Ended June 30:

<TABLE>
                                                                                             1998                        1997
                                                                                             ----                        ----
<S>                                                                                         <C>                         <C>

Net Loss                                                                                   $(22,715)                  $(37,174)

Dividends on cumulative preferred stock                                                        --                      (46,350)

Net Loss applicable to common stock                                                        $(22,715)                  $(83,524)
                                                                                           =========                   ========

Basic average common shares outstanding                                                      399,830                    399,830
                                                                                             =======                    =======

Loss per share - basic and dilutive                                                       $   (0.06)                   $  (0.21)
                                                                                          ==========                   =========

</TABLE>

                            Six Months Ended June 30:

<TABLE>
<CAPTION>
                                                                                             1998                    1997
                                                                                             ----                    ----
<S>                                                                                         <C>                     <C>

Net Loss                                                                                   $(19,564)              $(56,305)

Dividends on cumulative preferred stock                                                       ---                  (92,700)
                                                                                           ---------              ---------

Net loss applicable to common stock                                                        $(19,564)              $(149,005)
                                                                                           =========              ==========

Basic average common shares outstanding                                                      399,830                 399,830
                                                                                             =======                 =======

Loss per share - basic and dilutive                                                       $   (0.05)             $     (0.37)
                                                                                          ==========             ============
</TABLE>

The redeemable  convertible  voting senior  preferred stock is convertible  into
3,598,298 shares of common stock at June 30, 1998 and is anti-dilutive,  and the
effect of  dilutive  securities  (convertible  preferred  stock and  options) is
anti-dilutive for 1997, therefore,  basic and dilutive earnings (loss) per share
are the same for the periods presented.


<PAGE>


Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations

                  Financial Condition

         As a result of the Asset Sale in October 1993, previously reported, the
Company has ceased its business  operations.  The remaining note receivable from
the Sale, in the amount of $716,658 was paid in full in April 1996, with accrued
interest.

         Under  the  terms  of the  Company's  previously  outstanding  Series A
Preferred   Stock  and  Series  B  Preferred   Stock,  a  sale  or  transfer  of
substantially  all of the assets of the Company was deemed to be a  liquidation,
dissolution or winding up of the Company for purposes of determining the payment
of the  liquidation  preferences  on the Series A  Preferred  Stock and Series B
Preferred Stock. Accordingly,  the Asset Sale entitled Flum Partners, the holder
of all of the outstanding Series A Preferred Stock and Series B Preferred Stock,
to payment of the  applicable  liquidation  preferences  and  accrued and unpaid
dividends.

         As previously reported,  the Company issued to Flum Partners at the end
of 1997 and in the  first  quarter  of 1998 a total of  1,100,000  shares of the
Senior  Preferred  Stock and $1.8 million of cash in payment of the  liquidation
preferences  and accrued  dividends on the Series A Preferred Stock and Series B
Preferred  Stock.  In addition,  Mr. Flum's  employment  contract was terminated
effective December 1, 1997, and he agreed, for a twelve-month period, to attempt
to identify and  consummate a transaction  which would increase the value of the
Company.

         At June 30,  1998,  the Company had cash,  cash  equivalents  and other
liquid  assets of $80,487,  compared to  $1,400,051 of liquid assets at December
31, 1997,  and had working  capital of $34,503,  compared to working  capital of
$54,067 at December 31,  1997.  The Company has no bank lines of credit or other
currently  available credit sources.  The decrease in liquid assets reflects the
payment in the 1998 first quarter to Flum Partners described above.

Operations

         As a result of the Asset Sale and the operation by American  Pacific of
the Company's business from October 22, 1993, the Company's business  operations
as a food manufacturer were terminated on that date. Accordingly,  no operations
were conducted in the quarters ending June 30, 1998 and June 30, 1997.

         Net loss was $19,564,  or $.05 per share,  in the 1998 second  quarter,
compared  to a net loss of  $56,305,  or $.37  per  share,  in the  1997  second
quarter,  reflecting  principally  the  termination  of  Mr.  Flum's  employment
contract  effective  December 1, 1997,  offsetting  a decrease  in interest  and
dividend income.

<PAGE>


PART II  OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K

         No reports on Form 8-K have been filed during the quarter.


<PAGE>


                                                             Signatures


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


                           NEW GENERATION FOODS, INC.



                              By: /s/ Jerome S. Flum
                                     Jerome S. Flum
                            Chairman of the Board and
                           Principal Financial Officer



Dated: August 14, 1998