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:  March 31, 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.)


                                                  45 Graham Road
                                             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 March 31, 1998.

                                                    Page 1 of 11


<PAGE>


                   New Generation Foods, Inc. and Subsidiaries
                           Consolidated Balance Sheets
                      March 31, 1998 and December 31, 1997

<TABLE>
<CAPTION>
                                             March 31,               Dec. 31, 
                                              1998                    1997         
                                           (Unaudited)              (Audited)
                                            ---------                -------
<S>                                         <C>                     <C>
                                                                                                                   
Current Assets:
    Cash and cash equivalents                $102,425               $  1,399,274
    Marketable investment security
          at market value                         777                        777
                                                  ---                        ---

TOTAL ASSETS                                 $103,202                 $1,400,051
                                             ========                 ==========

</TABLE>
                                
See accompanying condensed notes to consolidated financial statements.

(Continued)
<PAGE>
NEW GENERATION FOODS, INC. AND SUBSIDIARIES

Consolidated Balance Sheets, Continued
<TABLE>                                             
<CAPTION>                                           

                                                  March 31,                      December 31,
                                                    1998                             1997
LIABILITIES AND STOCKHOLDERS'EQUITY (DEFICIT)    (unaudited)                      (audited)
--------------------------------------------     -----------                      -----------
<S>                                              <C>                             <C>
Current Liabilities:
    Accounts payable-shareholder                 $      0                         $   460,000
    Dividends payable                                   0                             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                              (23,865,710)                       (23,868,861)
                                              ------------                       ------------

                  
Total stockholders' equity (deficit)           (1,042,782)                         (1,045,933)
                                               -----------                         -----------

TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT)                                  $103,202                          $1,400,051
                                                  ========                          ==========

</TABLE>

See accompanying condensed notes to consolidated financial statements.
<PAGE>
NEW GENERATION FOODS, INC. AND SUBSIDIARIES

Consolidated Statements of Operations
(Unaudited)       
<TABLE>
<CAPTION>
                                                          For the three
                                                          months ended
                                                          March 31,
                                                1998                     1997                  
                                                ----                     ----                  
<S>                                            <C>                       <C>         
OPERATING EXPENSES
 Selling, general and administrative           $1,713                $ 39,976
                                               ------                 -------
         Total operating expenses               1,713                  39,976
                                                -----                  ------
         Operating loss                        (1,713)               (39,976)
                                               -------               --------

OTHER INCOME (DEDUCTIONS)
    Interest and dividend income                5,239                  24,220
    Loss on investments                            0                  (3,001)
                                                  --                  -------
                                                5,239                  21,219
                                                -----                 -------


  Income (loss) before income tax               3,526                (18,757)

INCOME TAXES                                      375                    373
                                                  ---                    ---

NET EARNINGS (LOSS)                              $3,151             ($19,130)
                                                 ======             =========
Net income (loss) per share of common stock:
    basic                                        $0.01                ($0.16)
    dilutive                                     $0.00                ($0.16)
Weighted average number of common
shares outstanding:
    basic                                      399,830                399,830
    dilutive                                 3,998,128                399,830


</TABLE>

No dividends were paid by the company during the three-month periods ended
March 31, 1998 and 1997.

See accompanying condensed notes to consolidated financial statements.

<PAGE>

NEW GENERATION FOODS, INC. AND SUBSIDIARIES

Consolidated  Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>

                                                         For the three
                                                         months ended
                                                         March 31,
                                                                        
                                                   1998                 1997
                                                   ----                 ----
<S>                                               <C>                  <C>
CASH FLOWS FROM OPERATING ACTIVITIES
    Net income (loss)                           $  3,151          $  (19,130)
    -----------------                              -----             --------

Adjustments to reconcile net income (loss)
to net cash  provided by (used in) 
operating activities:
    Depreciation                                    0                   1,315
    Loss on marketable investment securities        0                   3,001

Change in assets and liabilities:
    Decrease in receivables                         0                 (3,150)
    Increase (decrease) in accounts
      payable and accrued expenses           (1,300,000)              (9,978)
                                             -----------              -------

         Total adjustments                   (1,300,000)              (2,512)
                                             -----------              -------

Net cash used in operating activities        (1,296,849)             (21,642)
                                             -----------             --------

Net decrease in cash and
cash equivalents                             (1,296,849)             (21,642)
                                             -----------             --------

Cash and cash equivalents at beginning
of period                                      1,399,274            1,963,394
                                               ---------            ---------

Cash and cash equivalents at end of period   $   102,425          $ 1,941,752
                                               =========           ==========
</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 three month periods ended March 31, 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  ended March 31, 1997 has been  restated
to comply with Statement of Financial Accounting Standards No. 128.

<PAGE>

                     Net income (loss) per share computation

                                                      March 31,

                                               1998           1997
                                               ----           ----

Net earnings (loss)                       $    3,151       $(19,130)
Dividends on cumulative
preferred stock                                -            (46,350)
                                          ----------       ---------

Net earnings (loss)
applicable to common stock                $    3,151       $(65,480)
                                          ==========       =========

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

Dilutive average common
shares outstanding                         3,998,128         399,830
                                          ==========       =========

Earnings (loss) per share - basic         $     0.01       $  (0.16)
                                          ==========       =========

Earnings (loss) per share - dilutive      $     0.00       $  (0.16)
                                          ==========       =========



The redeemable  convertible  voting senior  preferred stock is convertible  into
3,598,298 shares of common stock at March 31, 1998.

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 first quarter of 1997.

<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 March 31, 1998, the Company had cash,  cash  equivalents and other liquid
assets of  $103,202,  compared to  $1,400,051  of liquid  assets at December 31,
1997, and had working capital of $57,218, 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 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 March 31, 1998 and March 31, 1997.

    Net  income  was  $3,151,  or $.01 per  share,  in the 1998  first  quarter,
compared to a net loss of $19,130, or $.05 per share (before giving effect to 
preferred stock dividends in the 1997 first quarter), in the 1997 first 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.


                                                       
                              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: May 15, 1998