(Source: Business Wire)Landec Corporation (Nasdaq: LNDC) today reported results for the fiscal year 2010 first quarter ended August 30, 2009. It should be noted that the first quarter of fiscal year 2010 had 13 weeks of operations whereas the first quarter of fiscal year 2009 had 14 weeks of operations. Revenues for the first quarter of fiscal year 2010 were $60.9 million compared to revenues of $71.8 million for the first quarter a year ago. Net income was $2.2 million or $0.08 per share in the first quarter of fiscal year 2010 compared to $2.8 million or $0.11 per share for the first quarter of last year.

"For the first quarter of fiscal year 2010, we generated $2.2 million in net income and $4.3 million of positive cash flow from operations," stated Gary Steele, Chairman and CEO of Landec. "Compared to the fourth quarter of fiscal year 2009, the first quarter of fiscal year 2010 resulted in improvements in operating income and net income. Value-added fresh-cut vegetable revenues for Apio, Inc., Landec's food subsidiary, increased $1.3 million, or 3%, compared to the first quarter of last year after excluding the value-added revenues for the extra week last year. In addition, we ended the first quarter of fiscal year 2010 with a record $69.5 million in cash and marketable securities. Since November 2008, we have felt the impact from the slumping U.S. economy and the decline in consumer spending. Despite the recession, our fresh-cut vegetable business continues to gain market share and outperform the overall industry category. According to syndicated market data, the overall industry unit volume sales in the fresh-cut vegetable category declined 6% for the three months ended August 30, 2009 compared to the same period a year ago. For Apio, unit volume sales in the fresh-cut vegetable category for the same three months ended August 30, 2009 increased 3% compared to last year. We believe that industry unit volume sales in the fresh-cut vegetable category will begin to return to positive growth during the second half of fiscal year 2010 as the economy begins to turn around and consumers return to buying fresh, nutritious and conveniently packaged produce products."

The decrease in revenues during the first quarter of fiscal year 2010 compared to the first quarter of last year was partially due to having 14 weeks in the first quarter of last year compared to 13 weeks in the first quarter of this year. The extra week last year resulted in approximately $5.0 million of additional revenues in the first quarter of fiscal year 2009 compared to this year's first quarter. For Apio's trading business, in addition to having one less week of revenues during this year's first quarter, revenues decreased an additional $6.7 million due to $2.5 million of decreased sales in our domestic buy/sell business as a result of the Company's decision to exit virtually all of this business and from a $4.2 million decrease in export sales primarily due to a shortage of export fruit products.

Net income for the first quarter of fiscal year 2010 decreased $655,000 compared to the first quarter last year, primarily due to five reasons: first, an approximate $600,000 decrease in gross profit due to one less week in the first quarter of fiscal year 2010 compared to the first quarter of last year; second, an approximate $200,000 decrease in gross profit for Apio's value-added vegetable business due primarily to higher produce costs; third, a $187,000 decrease in gross profit for Apio Packaging due to the contractual decrease in Chiquita minimums and a decrease in R&D funding from Apio's R&D agreement with the U.S. Military which was completed at the end of calendar year 2008; fourth, a $257,000 decrease in gross profit in the Technology Licensing business primarily due to the completion of the Air Products licensing payments during the third quarter of fiscal year 2009; and fifth, a $69,000 decrease in interest income due to lower yields on investments compared to the yields from investments in the same period last year. These decreases were partially offset by a $629,000 reduction in our income tax expense due primarily to lower pre-tax income.

Landec's First Quarter of Fiscal Year 2010 Earnings Conference Call

A conference call will follow this release at 8:00 a.m. Pacific Time on Wednesday, September 30, 2009, during which senior management of Landec will present an overview of results for the first quarter of fiscal year 2010. Interested parties have the opportunity to listen to the conference call live on the Internet at www.landec.com on the Investor Relations web page. A replay of the webcast will be available for 30 days. Additionally investors can listen to the call by dialing (866) 282-2519 or (703) 639-1263 at least 5 minutes prior to the start. A replay of the call will be available through Wednesday, October 7, 2009 by calling (888) 266-2081 or (703) 925-2533, code #1395388.

Landec Corporation is a materials science company that designs, develops, manufactures and sells temperature-activated and other specialty polymer products for a variety of food, agricultural and licensed partner applications. The Company's temperature-activated polymer products are based on its proprietary Intelimer® polymers which differ from other polymers in that they can be customized to abruptly change their physical characteristics when heated or cooled through a pre-set temperature switch. For more information about the Company visit Landec's website at www.landec.com.

Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ materially, including such factors among others, as the timing and expenses associated with expanding operations, the ability to achieve acceptance of the Company's new products in the market place, the severity of the current economic slowdown, weather conditions that can affect the supply and price of produce, the amount and timing of research and development funding and license fees from the Company's collaborative partners, the timing of regulatory approvals, new product introductions, the mix between domestic and international sales, and the risk factors listed in the Company's Form 10-K for the fiscal year ended May 31, 2009 (See item 1A: Risk Factors). As a result of these and other factors, the Company expects to continue to experience significant fluctuations in quarterly operating results and there can be no assurance that the Company will remain consistently profitable.