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Ralph D. McRae
Chairman and CEO
Leading Brands, Inc.
Toll Free: 1-800-729-2746 ext. 238
[email protected]

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Stan Altschuler
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Leading Brands, Inc. Announces Record Second Quarter and Six Month Net Income

VANCOUVER, BRITISH COLUMBIA, September 26, 2001 -- Leading Brands, Inc. (NASDAQ:LBIX) Q2: $0.06Cdn Per Share ($0.04 US Per Share) Six Month: $0.15Cdn Per Share ($0.10 US Per Share)

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Leading Brands, Inc. LBIX, Canada's largest independent, fully integrated food and beverage brand management company, is pleased to announce record profits for its fiscal second quarter ended August 31, 2001.

Revenues for the second quarter were $17,028,000Cdn ($11,116,000US), versus $23,360,000Cdn ($15,875,000US) for the second quarter of 2000. The Company reported net income for the period of $902,000Cdn ($589,000US) or $0.06Cdn ($0.04US) per share, compared to net income of $803,000Cdn ($546,000US) or $0.07Cdn ($0.05US) per share in the same period of last year.

Revenues for the first six months were $37,154,000Cdn ($24,080,000US), versus $45,459,000Cdn ($30,814,000US) for the first six months of 2000. Net income for the first six months of the year was $2,083,000Cdn ($1,349,000US) or $0.15Cdn ($0.10US) per share, compared to net income of $1,610,000Cdn ($1,091,000US) or $0.16Cdn ($0.11US) per share in the same period of last year.

During the first quarter, the Company's relationship with SoBe changed from distribution to co-pack. Although that affected revenues in the short term, profits were not impacted. The Company's other business remained strong, and indeed grew.

Leading Brands Chairman & CEO Ralph D. McRae said: "We continue to see increased growth in all of the primary areas of our business: co-pack, private label and branded products.

"We have recently expanded our co-pack relationships with two large multi-nationals and are now producing private label juice for several major US grocery chains. In this past quarter we introduced the Hansens' Gold Standard line of natural, nutraceutically enhanced beverages. We also saw the national listing of our Johnny's Roadside Lemonade and Tea line in the Canada Safeway chain, as well as the execution of a distribution agreement for that brand covering the entire Eastern US.

"Leading Brands now has listings of its brands in every significant grocery and convenience chain in Canada and provides the private label juice to all but one of them. Our attention has now turned in earnest to the US market.

"The superb fulfillment technology that we developed in conjunction with our Quick Home Delivery operation is also proving to have a much broader application than we originally contemplated. We are now implementing that technology throughout our company, so as to enhance our operating efficiencies and further reduce costs. We also look to launch our first B2B application using that system in Q3.

"Our continuing goal is to be the most efficient and effective operator in our industry. We believe that the wide array of food and beverage products that we represent, our strong customer relations and unique, technologically-advanced distribution system will allow us to continue to grow both revenues and profits in any foreseeable economic or political environment.

"I am particularly optimistic because, even with our dramatic growth over the past few years, there is still a remarkably large, untapped market available for Leading Brands. Our strategy is to remain focused on our goals, and enhance the value of our shareholders' investment for a long time to come."

Leading Brands, Inc. is the largest independent fully integrated food and beverage brand management company in Canada with a coast-to-coast distribution network that supports company brands and a wide range of complimentary products from other brand owners. It is also a major producer and distributor of private label products and a co-packer for major branded food and beverage items.

This news releases discusses primarily historical information. Statements included in this release, to the extent they are forward looking, involve a number of risks and uncertainties related to competitive factors, technological developments and market demand.

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