Leading Brands has reported a drop in full-year sales, despite posting a reduction in net losses.

For the 2008 fiscal year ended 28 February, net sales dropped to C$28.2m (US$26m) compared to C$32.6m in the previous year, the firm said today (1 June).

Net losses for the year improved to reach C$2.3m or $0.12 per share, from C$5.7m or $0.31 per share in fiscal 2007. The improvement was a result of increasing gross margin due to reductions in fixed overheads and SG&A expenses, the firm said. 

Leading Brands said the full impact of cost reductions and margin improvements will begin to be felt in the first quarter of fiscal 2009 as many of the changes impacted at different times throughout fiscal 2008.

Gross profit margin (before discounts and slotting fees) for the year was 41.3%, up from 33.7% in fiscal 2007.

The company said it has evaluated its US business model and made "several adjustments" over the past quarter that will allow it to "better and more cost effectively" service the market going forward in the face of the ongoing US economic downturn.