Danier Leather Reports Fiscal 2009 Second Quarter Results

Inventory at the end of the second quarter of fiscal 2009 decreased by $0.5 million to $40.8 million compared with $41.3 million last year. Book value per outstanding share was $10.16. During the first half of the current fiscal year, Danier repurchased 100,000 subordinate voting shares for cancellation under its normal course issuer bid.

(1) EBITDA is defined as net earnings before interest expense -- net, income taxes, amortization and litigation provision and related expenses. EBITDA is a financial metric used by management and some investors to compare companies on the basis of ongoing operating results before income taxes, interest expense - net, amortization and litigation provision and related expenses and its ability to incur and service debt. EBITDA is not a recognized measure for financial presentation under Canadian generally accepted accounting principles ("GAAP"). Non-GAAP earnings measures such as EBITDA do not have any standardized meaning prescribed by Canadian GAAP and, therefore may not be comparable to similarly titled measures presented by other publicly traded companies, nor should they be construed as an alternative to other financial measures determined in accordance with Canadian GAAP. EBITDA is calculated as outlined in the following table:


                        For the 13 Weeks Ended       For the 26 Weeks Ended
                   ---------------------------------------------------------
                    Dec 27, 2008  Dec 29, 2007   Dec 27, 2008  Dec 29, 2007
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                           ($000)        ($000)         ($000)        ($000)

Net earnings              $6,474        $5,978         $2,768       $15,798
Income tax                 3,391         3,666          1,018         6,168
Interest expense
 - net                        90           152            110           202
Amortization               1,292         1,431          2,572         3,052
Litigation provision
 and related expenses          -          (107)             -       (18,107)
                   ---------------------------------------------------------
EBITDA                   $11,247       $11,120         $6,468        $7,113
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(2) Adjusted net earnings is defined as net earnings before litigation provision and related expenses and income taxes related to the litigation provision and related expenses. Adjusted net earnings is a financial metric used by management and some investors and allows for a more effective analysis of the ongoing operating performance of the Company. Adjusted net earnings is not a recognized measure for financial presentation under Canadian GAAP. Non-GAAP earnings measures such as adjusted net earnings do not have any standardized meaning prescribed by Canadian GAAP and therefore may not be comparable to similarly titled measures presented by other publicly traded companies, nor should they be construed as an alternative to other financial measures determined in accordance with Canadian GAAP. Adjusted net earnings is calculated as outlined in the following table: