Menlo Park, California
September 10, 2002

Landec Corporation (Nasdaq:LNDC), a developer and marketer of technology-based polymer products for food, agricultural and licensed partner applications, today reported results for the third fiscal quarter ended July 28, 2002.

Total revenues for the quarter were $44.5 million versus $47.1 million in the third quarter of fiscal 2001. Landec reported a net loss from continuing operations applicable to common shareholders of $586,000, or $0.03 per share, compared with a net loss of $1.6 million, or $0.09 per share, for the year ago quarter. Revenues for the first nine months of fiscal 2002 were $141.9 million versus revenues of $151.6 million a year ago. The Company reported net income from continuing operations applicable
to common shareholders of $1.1 million or $0.06 per diluted share for the first nine months of fiscal 2002 compared to a loss of $2.0 million or $0.12 per share, in the first nine months of fiscal 2001. EBITDA -- earnings before interest, taxes, depreciation and amortization -- for the third quarter was $750,000 versus $299,000 in the third quarter of last year. For the nine-month period, EBITDA was $5.1 million versus $3.5 million for the same period last year.

The results for the third quarter and for the first nine months of fiscal 2002 include the impact of the change in accounting for the amortization of intangibles. Intangibles deemed to have an indefinite life are no longer amortized. The implementation of this change increased third quarter net income by approximately $656,000, or $0.03 per share and net income for the first nine months by approximately $1.9 million, or $0.09 per diluted share. In addition, during the third quarter of fiscal year 2002 the Company sold its Reedley fruit processing facility for net proceeds of $2.2 million, resulting in a gain of $436,000, or $0.02 per share.

"Revenues for the quarter and the first nine months are down 6% as compared to the same periods last year because of the Company's earlier decision to downsize its "fee-for-service" commodity produce business," said Gary Steele, president and CEO of Landec. "At the same time, revenues for the quarter from our specialty packaging value-added produce business increased 29% as compared to the year ago quarter. For the first nine months revenues from our value-added business increased 18% and revenues from our agricultural seed business increased 20% compared to the same period last year. Gross margins as a percent of revenues increased to 15% in the third quarter of fiscal year 2002 from 13% in last year's third quarter and for the nine months gross margins have increased to 18% this year from 15% last year."

"We expect fiscal 2002 revenues to be lower than the previous year due to our strategic decision to downsize our "fee-for-service" business which will decrease service revenues for the year, as can be seen in our year to date results. While service revenues will decrease, we expect revenues from product sales to increase 10% to 20% from the prior year and we expect gross margins as a percent of product sales to continue to increase," continued Steele.

"Our third quarter results reflect the impact of the expanded efforts we are expending on our banana packaging technology program. As outlined in our press release on August 21, 2002, we have incurred considerable incremental expense to expand our banana sourcing and market trials in order to capitalize on this opportunity. For the three and nine month periods ended July 28, 2002, the efforts to expand our banana program have impacted our bottom line by approximately $700,000 and $1.5
million, respectively, with up to an additional $500,000 expected to be spent in the fourth quarter on these efforts," Steele added.

"Our R&D and trial work for the banana technology program is focused on three main objectives: (1) qualifying sources from large, multinational banana shipping companies, (2) optimizing the use of our 40 lb. Intellipac(TM) package so that the extended shelf life we deliver can be translated into consistent savings and increased sales for the retail grocery chains and (3) developing new package sizes for consumers that will allow bananas to be sold in ways that are unique to the industry. We know the market is in need of technology that can extend banana shelf life and lower the costs to retailers. Since April 2002 we have sold nearly $5 million of Eat Smart(R) bananas using our Intellipac technology. We are not, however, comfortable continuing to sell to the retail grocery marketplace until we have qualified additional sources of bananas and further optimize the technology for the 40 lb. package application. In the meantime, the Company is focusing its short-term efforts for its Intellipac banana packaging technology on opportunities which include market segments such as the food service market whose needs can be currently met with Landec's existing banana sources," stated Steele.

"The success of our Intellipac food packaging technology has allowed us to convert not only fresh-cut produce but also whole produce commodities into value added products that bring real differentiation to retailers and to growers. We project that Apio's Eat Smart products using our proprietary Intellipac specialty packaging will grow to over 50% of Apio's revenues this year from 40% last year," Steele added.

Commenting on the financial condition of the Company, Steele said, "During the quarter we used $7.4 million in cash, of which $6.0 million was used to pay down debt. The ending cash balance of $1.2 million plus $10.0 million available under our lines of credit gives us a combined cash and lines of credit total of $11.2 million, up from the combined cash and lines of credit total of $11.1 million at the end of the second quarter. The Company believes that the combined cash and lines of credit total of $11.2
million, along with the projected cash from the sale of Dock Resins and positive cash flow from operations expected during the fourth quarter of this fiscal year, will provide sufficient cash resources to effectively operate the business for the foreseeable future without additional equity placements. During the first nine months of fiscal year 2002, the Company has (1) paid down debt by $16.2 million or a 49% reduction to $17.2 million from $33.4 million at the end of fiscal year 2001, (2) reduced the debt-to-equity ratio from 67% at the end of fiscal year 2001 to 29% at the end of the third quarter of fiscal year 2002 and, (3) nearly doubled net working capital to $10.4 million at the end of the third quarter of fiscal year 2002 from $5.4 million at the end of fiscal year 2001."

Operating Highlights and Outlook

Apio's Intellipac Packaging Products Business Continues to Grow

During the first nine months of fiscal year 2002, Apio's iceless packaging product line continued to experience accelerated growth. Apio now has six iceless packaging products for vegetables utilizing our Intellipac case liner technology, including bunch and crown broccoli, eighteen pound cartons of loose broccoli florets, Asian cut broccoli crowns, export cut broccoli crowns and green onions. The expansion of the iceless packaging product line has the potential to generate substantial revenues for Apio over the coming quarters and years. Apio also introduced eight new product offerings during the first nine months of fiscal year 2002 and expanded its retail and club store presence to over 8,700 stores from 7,600 at the end of fiscal year 2001.

In addition, the Company has expanded its banana program using Intellipac technology and is in the process of qualifying sources in five primary banana producing countries and working directly with large, multinational banana shipping companies to ensure consistently high quality and year round availability of bananas. Apio will be conducting more retail banana trials in the U.S and with select banana companies. Bananas are a $4 to $4.5 billion annual worldwide market for distributors, which in
turn, is a $9 to $10 billion annual worldwide market for retailers. Bananas are the nation's leading produce item, contributing approximately nine to ten percent of produce department sales in the U.S.

Landec Ag's Intellicoat(R) Seed Coating Product Sales Accelerate

Landec Ag, the Company's Intellicoat seed coating subsidiary, has expanded its field trials and commercial sales during fiscal year 2002 for its new Early Plant(TM) hybrid corn. The new products join the existing line-up of Intellicoat coated Pollinator Plus(TM) seed corn coatings, Relay(TM) Intercropping of wheat and coated soybean and Fielder's Choice Direct(R) hybrid corn.

Early Plant hybrid corn is designed to allow corn farmers to safely and reliably plant hybrid corn two to three weeks earlier than normal, since Landec's proprietary Intellicoat coating delays germination until the soil reaches the optimal soil germination temperature. Otherwise, planting two to three weeks earlier in cold, wet soil could cause poor or no germination to occur. Allowing the farmer to have a wider planting window lowers costs, reduces risks and potentially increases yields. The program for Early Plant hybrid corn has increased five-fold to approximately 15,000 acres this spring from 3,000 acres in 2001.

For the 2002 planting season, when comparing Intellicoat coated seeds to uncoated seeds in early-plant trials, the Intellicoat coated seeds have consistently shown better, more uniform emergence and higher stand counts for improved yield potential. Landec Ag is now commercially launching its Intellicoat Early Plant corn seed coating technology on its Fielder's Choice Direct hybrid seed corn. Orders to date have exceeded the total units sold all of last year by nearly 60% or 2,800 units.

In addition, eight of the top U.S. seed companies are conducting separate evaluations of the Intellicoat Early Plant hybrid corn technology on their own hybrids during 2002. Successful results could lead to licensing agreements as early as 2003.

Pollinator Plus seed coatings are applied to inbred seed corn to delay seed germination and extend the pollination window thus reducing risks and increasing yields for seed companies. Pollinator Plus is already being used by 30 major seed companies in the production of hybrid seed corn. Seed companies are rapidly increasing their use of this technology, and this product line has been planted on over 60,000 acres in 2002, three times the 20,000 acres in 2001.

Another Intellicoat application is the Relay Intercropping of wheat and Intellicoat coated soybeans system. The Relay system enables Central and Northern Corn Belt farmers, whose growing season is normally too short for double cropping, to successfully inter-plant coated soybeans into wheat fields and gain more revenue by harvesting two crops off the same field in the same year. This Intellicoat application is in its third year of successful commercial on-farm sales.

Landec Ag also directly markets and sells seed products using a sophisticated telephonic and electronic call center headquartered in Monticello, Indiana. In 2000, Landec Ag introduced its Harvestar(TM) product line, which offers high performance alfalfa and nutrient enhanced hybrid seed corn. These products are being sold to new and existing customers who have expressed interest in these types of seeds.

Landec Corporation 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(R) 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.

The complete release is at www.landec.com