California

(State or other jurisdiction of incorporation or organization)

0-27446

94-3025618

(Commission file number)

(IRS Employer Identification No.)

Exhibit
Number

Description

LANDEC CORPORATION

Registrant

/s/

Gregory S. Skinner

Gregory S. Skinner

Vice President of Finance and

Chief Financial Officer

Exhibit No.

Description

Press Release dated September 30, 2008

LANDEC CORPORATION

CONSOLIDATED CONDENSED BALANCE SHEETS

(In thousands)

August 31, 2008

May 25, 2008

LANDEC CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(In thousands, except per-share data)

(unaudited)

Total revenues

(1,911

)

0.11

0.11

LANDEC CORPORATION

FIRST QUARTER ENDED AUGUST 31, 2008

The decrease in consensus EPS for fiscal year 2009 compared to fiscal year 2008 is due to the significant increase in the Company's GAAP income tax expense for fiscal year 2009, most of which represents a non-cash expense (see Question #2 below). The Company's effective GAAP tax rate is projected to increase to 40% in fiscal year 2009 from 20% last year, which results in an increase in our GAAP tax expense of more than 130%.

Because of the benefit of substantial net operating losses, primarily from the repurchase of subsidiary options, and tax credit carryforwards, we are estimating that in fiscal year 2009 Landec will pay only 10% of our GAAP income tax expense in cash, for an effective cash tax rate of 4%, resulting in the preservation of cash and a favorable impact on our cash balance.

We have five priorities: (1) continue to grow revenues, pre-tax profits and free cash flow, (2) extend the commercialization of our BreatheWay packaging programs in bananas, avocados and new applications, (3) provide strong technology support to our licensing corporate partners in launching new products, (4) seek synergistic acquisition opportunities that use our technology or expand our technology base, and (5) expand our Intelimer polymer materials R&D activities in order to develop new business opportunities.

Our programs with Chiquita are progressing well on all four fronts:

a) In the Chiquita-To-Go program, Chiquita bananas in our packaging are being sold to coffee chains, convenience stores and mini-mart gas stations. Chiquita is a major supplier of bananas to Starbucks who has recently rolled out its new Vivanno(TM) banana smoothie program throughout the United States. In addition, the Chiquita-To-Go program has been launched in three European countries.

b) In the QSR arena, McDonald's is currently conducting regional market tests for banana products, including banana smoothies, using Chiquita(R) bananas delivered in Landec's BreatheWay packaging. We are quite enthusiastic about the expansion into QSRs and we look forward to updating you on the progress of this program throughout fiscal year 2009.

c) Retail grocery store advanced trials are scheduled to begin as soon as Chiquita has selected a retail grocery store trial partner that will test consumer demand, price points, package size, configuration and merchandising approaches. This program is several quarters later than we had originally expected but is now moving forward as a high priority at Chiquita. We are hopeful that the trials will begin this fall.

d) In our avocado program with Chiquita, Chiquita is selling avocadoes packaged in our BreatheWay packaging technology to food service customers. Chiquita is also developing a retail grocery store application for avocados delivered in our BreatheWay packaging and trials are scheduled to begin in October 2008.

We have concerns about the U.S. economy and rising consumer expenditures for non-food items, but we still believe we have a 10% per year long-term growth opportunity in our food business by (1) capturing new customers, and (2) expanding our BreatheWay technology to new markets and application areas. For our food business, our longer-term growth plans include six major initiatives.

Initiatives for our Apio value-added specialty packaged vegetables business include:

i) Access unique produce with consumer traits that bring discernible differentiation in nutrition, taste, color, aroma and/or texture. We will do this through our new exclusive licensing arrangement with Monsanto Seminis, the world's largest vegetable seed trait developer and supplier. Initial field trials began earlier this month.

ii) Develop and launch new, innovatively designed products such as those we are developing in our vegetable salad line.

iii) Look for synergistic acquisition partners that can benefit from our BreatheWay technology and channels of distribution, as well as from our expertise in post harvest physiology, sourcing, and processing.

Initiatives for our Apio packaging technology business include:

i) Expand the use of our BreatheWay technology internationally. We announced a new distribution agreement in June with Breakthrough Solutions for our packaging technology for South America.

ii) Expand our BreatheWay technology in new markets in North America such as food service and delis. Our Apio food business now has these efforts underway using our BreatheWay packaging technology.

iii) Expand our BreatheWay technology into new product applications such as berries, mangos, melons and flowers to name a few.

In summary, we have a plan in place for continuing to profitably grow our food business.

Monsanto recently formed a new business called the Seed Treatment Business which allows Monsanto to develop its seed treatments internally rather than purchasing its seed treatments from third parties. As a reminder, Monsanto has over a 30% market share in corn, soybeans and cotton and is also a major player in canola and vegetable seeds.

The concept of seed treatments is to place an insecticide or fungicide directly onto the seed surface in order to protect the seed and the seedling as it emerges. It is our hope that Landec's Intellicoat(R) seed coating technology can be an integral and proprietary part of Monsanto's commitment to building a major position in seed treatments worldwide by using Landec's seed coatings as a "carrier" of insecticides/fungicides which can be dispensed at the appropriate time based on time or soil temperature. We are excited about this program and in fiscal year 2009 we will be focused on validating the use of Landec's coating technology for these applications.

The progress has been slow in the first two years, but momentum is now building as new product applications and formulations are emerging from the laboratory. Landec and Air Products have agreed to focus on two areas -- personal care and catalysts. We are hopeful that with Air Products we can continue to expand our relationships with key customers this year, such as L'Oreal in personal care and Akzo Nobel in catalysts.

As part of our agreement, Apio and Seminis will work together to identify and develop unique varieties of broccoli and cauliflower for the North American market for use in Apio's proprietary value-added packaged bags and trays for retail grocery chains, club stores and the foodservice industry. The companies will focus on developing and commercializing broccoli and cauliflower varieties that possess unique, desirable consumer traits such as improved nutrition, flavor, color, texture, taste, and/or aroma to improve the value of these vegetable offerings in Apio's products.

Seminis will apply its expertise to breed broccoli and cauliflower qualities using proven techniques that improve the speed and accuracy of new and beneficial trait identification and selection. For its part, Apio will apply its expertise in sourcing, manufacturing, packaging and marketing of vegetable products to provide definition and guidance of market needs, packaging solutions and commercialization strategies for these novel consumer trait vegetables. All products that reach commercialization will be packaged using Apio's proprietary Intelimer BreatheWay packaging. We believe this collaboration further supports our position in the marketplace as the technology and innovation leader in fresh-cut vegetable products.

In addition to supporting our existing license partners, we are examining several areas to broaden applications for our Intelimer polymer technology. For example, we have been studying how our technology can selectively dispense (both large and small molecule) active ingredients, either slowly over time or as a rapid release of active ingredients, "triggered" by changes in temperature, time and pH. We are filing numerous patent applications to extend our patent estate in this area. We believe there is a large formulation potential for this technology in the pharmaceutical industry which is looking for new ways to extend patent life for existing drugs and in the agricultural industry for the controlled release of pesticides and/or insecticides.

The Pre-Tax results are as follows (unaudited and in thousands):

a) Apio’s Value-Added business includes revenues and gross profit from Apio Cooling LP.

b) Apio Packaging includes the BreatheWay trademark for banana packaging, packaging technology for other shelf life sensitive vegetables and fruit, plus other unique packaging solutions.

c) Apio’s Trading business includes its commission-based commodity export business and its commission-based domestic commodity buy/sell business.

d) Included in Tech. Licensing are the Intellicoat license fees from Monsanto.

e) Included in Other are net interest income and non-operating income/(expense).