Vlasic Foods International (NYSE: VL) yesterday announced its fiscal 2001 first quarter results for the period ending October 29, 2000. The Company said that its strategic review process, which it is implementing together with Lazard Freres, is progressing and continues to move forward.

Vlasic Foods reported first quarter sales of $215 million, compared to $235 million a year ago. This decrease was primarily due to a decline of 12 percent in sales of ``Vlasic'' pickles and a 2 percent decline in ``Swanson'' frozen foods related to reduced inventories held by our customers. Also, the shifting of marketing programs from the first quarter a year ago to the second quarter this year impacted pickle sales. However, consumption in the quarter increased 1 percent in ``Vlasic'' pickles and was flat in ``Swanson.'' Sales in the U.K. were negatively impacted by aggressive competition and pricing pressures as well as currency exchange.

As a result of ongoing operational difficulties and uncertainties associated with the strategic review process, the Company recorded special charges of $133 million or $2.94 per share in the first quarter. Those charges include $96 million or $2.12 per share for the impairment of its United Kingdom assets resulting from continuing declines in those businesses; and $21 million, or $0.46 per share for the impairment of certain frozen food manufacturing assets in Omaha, Neb., due to less favorable terms in a revised frozen foodservice supply agreement. Also included is $16.2 million or $0.36 per share related to valuation allowances for deferred taxes no longer likely to be realized. Including these charges, the net loss for the first quarter was $148.9 million, or $3.28 per share.

Excluding special items, net earnings (loss) from continuing operations for the quarter showed a loss of $15.7 million, or $0.34 per share versus earnings of $5.4 million, or $0.12 per share a year ago principally driven by soft results in the U.K. and the lower pickle sales.

During the quarter the Company continued to focus on cash generation. The Company completed the quarter with $10 million in cash.

Also in the quarter, the Company successfully implemented a distribution expansion program for its key ``Swanson'' and ``Vlasic'' businesses. As a result, the Company has secured more than 200 additional points of distribution in its pickle business, or the equivalent of two new products receiving full national distribution. Similar new distribution gains have also been achieved in the ``Swanson'' business behind the new Potato Topped Pie line and new and improved ``Swanson'' beef and turkey dinners.

Forward Looking Statement

This release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company believes the assumptions underlying the forward-looking statements, including those relating to new products, consumption patterns, marketing strategies, and the strategic review process are reasonable. However, any of the assumptions could be inaccurate, and therefore there can be no assurance that the forward- looking statements contained in this release will prove to be accurate. Additional information that could cause actual results to vary materially from the results anticipated may be found in the Company's most recent Form 10-K and other reports filed with the Securities Exchange Commission. Furthermore, the Company disclaims any obligation or intent to update any such factors or forward-looking statements to disclaim future events and developments.

                          VLASIC FOODS INTERNATIONAL
                    STATEMENTS OF OPERATIONS  (unaudited)
                   (in thousands, except per share amounts)

                                                        QUARTER ENDED
                                                  October 29,  October 31,
                                                     2000          1999

    Net sales                                       $215,252     $234,935

    Costs and expenses
      Cost of products sold                          148,353      155,261
      Marketing and selling expenses                  54,613       45,309
      Administrative expenses                         14,668       11,409
      Research and development expenses                1,786        2,066
      Other expense, net                              (3,159)         585
      Special items                                  117,000            -
        Total costs and expenses                     333,261      214,630

    Earnings (loss) before interest and taxes       (118,009)      20,305
    Interest expense, net                             14,464       11,524
    Earnings (loss) before taxes                    (132,473)       8,781
    Taxes on earnings                                 16,400        3,425
    Earnings (loss) from continuing operations      (148,873)       5,356
    Discontinued operations
      Earnings (loss) from discontinued
       operations, net of tax                              -       (1,247)
    Net earnings (loss)                            $(148,873)      $4,109


    Earnings (loss) per share - basic
      Earnings (loss) from continuing operations      $(3.28)       $0.12
      Earnings (loss) from discontinued operations       $ -       $(0.03)
      Net earnings (loss)                             $(3.28)       $0.09

    Weighted average shares outstanding - basic       45,418       45,502

    Earnings (loss) per share - assuming dilution
      Earnings (loss) from continuing operations      $(3.28)       $0.12
      Earnings (loss) from discontinued operations       $ -       $(0.03)
      Net earnings (loss)                             $(3.28)       $0.09

    Weighted average shares outstanding
     - assuming dilution                              45,418 *     45,529 *

Excludes potentially dilutive shares as the result would be antidilutive.
                          VLASIC FOODS INTERNATIONAL
                SCHEDULES OF SEGMENT INFORMATION  (unaudited)
                                (in thousands)

                                            QUARTER ENDED
                                      October 29,   October 31,     Percent
                                          2000          1999        Change
    Net Sales
      Frozen Foods                     $135,174       $139,929         -3%
      Grocery Products                   52,629         58,944        -11%
      United Kingdom Operations          27,449         36,062        -24%
        Total                          $215,252       $234,935         -8%

    Earnings (Loss) Before Interest
     and Taxes from Continuing
     Operations (A)
      Frozen Foods                     $(14,709)       $15,243
      Grocery Products                   (3,690)         7,569
      United Kingdom Operations         (99,891)          (405)
      Unallocated Corporate Expenses        281         (2,102)
        Total                         $(118,009)       $20,305

(A) Contributions to earnings (loss) before interest and taxes from continuing operations in the quarter ended October 29, 2000, included the following special items: non-cash writedowns of impaired assets of $96 million relating to our United Kingdom operations as the result of ongoing diminished cash flows and $21 million relating to our Omaha frozen food plant as the result of the revised contract for frozen foodservice copacking for Campbell Soup Company.
                                             QUARTER ENDED
                                      October 29,     October 31,
                                          2000            1999

      Frozen Foods                      $21,000            $ -
      Grocery Products                        -              -
      United Kingdom Operations          96,000              -
      Unallocated Corporate Expenses          -              -
        Total                          $117,000            $ -


                          VLASIC FOODS INTERNATIONAL
                    CONDENSED CONSOLIDATED BALANCE SHEETS
                                (in thousands)

                                                   October 29,    July 30,
                                                      2000          2000
                                                   (unaudited)   (audited)

    Cash and cash equivalents                        $10,012      $24,092

    Restricted cash                                    7,358        9,873

    Other current assets                             206,814      188,888

    Plant assets, net                                176,652      266,347

    Other assets, principally intangibles, net        57,481       92,973

        Total assets                                $458,317     $582,173


    Notes payable                                   $285,783     $285,287

    Other current liabilities                        121,968      111,668

    Long-term debt                                   197,258      197,230

    Other liabilities                                 44,980       47,456

    Shareowners' deficit                            (191,672)     (59,468)

        Total liabilities and
         shareowners' deficit                       $458,317     $582,173


    Total debt                                      $483,041     $482,517