Summary

 --  Sales for the 2nd Quarter 2009 totaled $12.6 million, vs. $17.0     million in 2008. --  Net income for the 2nd Quarter totaled $75,000 in 2009, vs. $598,000     in 2008. --  Net loss year-to-date totaled $1.1 million in 2009, vs. a net loss of     $1.2 million in 2008.      

Financial Results

"The global economic recession continued to significantly restrict consumer spending through the second quarter of 2009 and this translated into much lower demand for our zipper and trim products," said Lonnie Schnell, Talon's CEO. "Although the initial panic within the apparel industry seems to have subsided, and encouraging signs are emerging, consumers remain cautious about their spending and the retail brands continue to limit their buying and lower their inventory levels."

Sales for the second quarter of 2009 totaled $12.6 million, a decrease of $4.4 million or 26% from 2008. The decrease in sales for the quarter was a direct result of the impact of the economic decline on the apparel industry and the corresponding lower demand for the apparel products that brand suppliers purchase from the Company. For the second quarter of 2009 the Company reported Talon(R) zipper sales of $7.7 million as compared to $11.4 million for the same period in 2008. Trim product sales for the second quarter of 2009 were $4.9 million, as compared to $5.5 million for the same period in 2008, and Tekfit product sales for the second quarter were $23,000 compared to $36,000 in 2008.

Sales for the six months ended June 30, 2009 were $19.1 million as compared to $27.0 million for the same period in 2008, a decrease of $7.9 million or 29%. Talon(R) zipper sales for the first six months of 2009 totaled $11.0 million as compared to $17.1 million in the prior year. Trim product sales for the first six months of 2009 were $8.0 million, a decrease of $1.9 million from the same period in 2008. Tekfit product sales for the first six months of 2009 were $37,000 compared to $44,000 for the first six months of 2008.

For the second quarter of 2009 net income of $75,000 or $0.01 per share was reported by the Company, as compared to net income of $598,000 or $0.03 per share for the second quarter in 2008. For the six-months ended June 30, 2009 the Company reported a net loss of $1.1 million or a loss of $0.05 per share, as compared to a net loss of $1.2 million or $0.06 per share for the six months ended June 30, 2008.

"The cost reduction actions we implemented late in 2008 in response to the economic decline have substantially lessened the impact of the significantly lower revenues in 2009," said Schnell. "For the first six months of 2009, the benefits of these actions helped deliver expense reductions that more than offset the effects of the recession on our sales levels. As the apparel industry recovers, these actions along with our continued emphasis on new nominations, new product development and our commitment to superior customer service we believe will yield measurable improvements in earnings compared to the prior year."

Selling expenses for the second quarter of 2009 were $531,000, reflecting a reduction of $237,000 compared to the same period in 2008. General and administrative expenses for the second quarter of 2009 were $2.2 million, as compared to $3.1 million for the second quarter of 2008. The decrease of $0.9 million in general and administrative expenses is principally attributable to reductions in our global workforce to align our costs with current sales levels.

The net income for the second quarter and net loss for the first six months of 2009 includes net interest expense of $661,000 and $1,298,000, respectively. The interest expense for 2009 reflects an increase of $18,000 and $105,000 for the second quarter and six months ended June 30, 2009, respectively, as compared to net interest expense for the same periods in 2008. The increased interest cost in 2009 over 2008 was primarily the result of slightly increased borrowings under the debt facility with CVC California, LLC (formerly Bluefin Capital, LLC).

Conference Call

Talon International will hold a conference call on Monday, August 17, 2009, to discuss its second quarter financial results. Talon's CEO Lonnie D. Schnell will host the call starting at 4:30 P.M. Eastern Time. A question and answer session will follow the presentation.