Shareholder Newsletter

April 1, 2007 - Issue No. 40

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DEAR FELLOW SHAREHOLDERS:

LBIX MONTHLY NEWSLETTER

Sometimes little milestones in the development of brands are more significant than they might first appear.  During the month of February we had a regular promotion ongoing for TrueBlue® at Wal-Mart Canada.  For that period, TrueBlue® was the number 6 selling grocery product within the chain.  That's not just for beverages, it's for ALL grocery items.  We have never experienced anything like that before.  I suspect that few beverage companies have.

Our plant consolidation is well under way and will swing into high gear at the end of this month.  Although nothing is firm as yet, we should be transitioning the Hansen energy drinks in Canada at about the same time.  In looking ahead over the next few months there will be a period where we will be moving out of the distribution of Monster® and Lost® energy drinks in Canada and then introducing replacement products, both in Canada and the United States.  It will take us a while to regain the sales levels we now have in that category, but we anticipate that our new product introductions will capture materially greater margin contribution per case.  That, combined with our entry for the first time into a US energy drink market that is more than 40 times the size of Canada, holds some wonderful opportunity for us.  Stay tuned for more developments.

Several years ago we set out to transform our company from doing a lot of things for other people, primarily in Western Canada, to becoming a North American-wide premium beverage company.  By the middle of 2007 that transformation will be virtually complete.

Thank you for your continued support.

Sincerely,
LEADING BRANDS, INC.

Per:

Ralph D. McRae
Chairman & CEO

Disclaimer:
Certain information contained in this press release includes forward-looking statements. Words such as “believe”, “expect,” “will,” or comparable terms, are intended to identify forward-looking statements concerning the Company’s expectations, beliefs, intentions, plans, objectives, future events or performance and other developments. All forward-looking statements included in this press release are based on information available to the Company on the date hereof. Such statements speak only as of the date hereof. Important factors that could cause actual results to differ materially from the Company’s estimations and projections are disclosed in the Company’s securities filings and include, but are not limited to, the following: general economic conditions, weather conditions, changing beverage consumption trends, pricing, availability of raw materials, economic uncertainties (including currency exchange rates), government regulation, managing and maintaining growth, the effect of adverse publicity, litigation, competition and other risk factors described from time to time in securities reports filed by Leading Brands, Inc.