NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR:  DANIER LEATHER INC.

TSX SYMBOL:  DL

OCTOBER 16, 2002 - 09:20 EDT

Danier Leather Reports First Quarter Results For Fiscal
2003

TORONTO, ONTARIO-- 

Sales increase 6%; results reflect increased store base and 
strategic long-term investments 

Danier Leather Inc. (TSX: DL) today announced its consolidated 
financial results for the first quarter and 13 weeks ended 
September 28, 2002. 


/T/

HIGHLIGHTS ($000s, except earnings per share):  
                                          
                                For the 13 Weeks   For the 12 Months 
                                     Ended                Ended 
                             Sept. 28,   Sept. 29, Sept. 28, Sept. 29,
                                  2002        2001      2002      2001  
----------------------------------------------------------------------
Sales                          $22,695     $21,426  $181,246  $164,907
----------------------------------------------------------------------
EBITDA (Loss)                 ($3,853)    ($2,384)   $22,215   $23,816
----------------------------------------------------------------------
Net Earnings (Loss)           ($3,372)    ($2,315)    $9,668   $10,918
----------------------------------------------------------------------
EPS Basic                      ($0.49)     ($0.34)     $1.41     $1.59
----------------------------------------------------------------------
EPS Diluted                        N/A         N/A     $1.37     $1.57
----------------------------------------------------------------------


/T/

FIRST QUARTER HIGHLIGHTS 

* Revenues increase 6% to $22.7 million 

* Sales of accessories rise 37%  

* Opened one new power centre and expanded one existing mall store


* Launched corporate sales division with strong growth potential 

* Continued to grow awareness of the Danier brand among consumers 
and the key fashion press 

* Continued focus on U.S. operations with a view to growth 

"We are pleased with the continued growth in sales and the 
successful implementation of our long-term growth plans," said 
Jeffrey Wortsman, President and CEO of Danier Leather. "The first 
quarter is historically our slowest and this year's higher 
quarterly loss was expected given our larger store base and recent
strategic long-term investments. While larger first quarter losses
are a normal consequence of adding more stores, our many growth 
initiatives, including accessories, corporate sales and 
international expansion, should all help to reduce this seasonal 
effect over time."  

For the 13 weeks ended September 28, 2002, revenues rose 6% to 
$22.7 million as compared with the 13-week period ended September 
29, 2001. Net loss was $3.4 million, or $0.49 per share, compared 
with a loss of $2.3 million, or $0.34 per share for the same 
period last year.  

Sales benefited from the addition of four new power centres as 
well as a comparable store sales increase of 2%. The decrease in 
net earnings results primarily from the additional overhead of 
four new stores and five expanded shopping mall stores as compared
with the same period last year. Earnings were also affected by 
higher amortization costs from capital expenditures and salaries 
and benefits resulting from recent investments in the company's 
infrastructure in anticipation of its next stage of growth.  

Gross profit margin of 44.7% in the first quarter exceeded the 
44.4% gross margin recorded in Q1 2002.  

Danier opened one power centre store in the first quarter 
(Winnipeg) and expanded one mall store (Yorkdale Mall in Toronto).
Plans for the second quarter include the opening of one new mall 
store, three new power centres and the expansion of an existing 
mall store.  

"Danier is entering the second quarter from a position of 
strength. Margins have been improving and were 3.1% (or 3100 basis
points) higher in September 2002 than in the same month last year.
Accessories sales have been performing very well, increasing 37% 
year-over-year and accounting for 20% of total first quarter sales
versus 15% a year ago. Our high quality merchandise, exciting new 
marketing campaign and strengthened management team give us 
confidence heading into our peak selling season," added Mr. 
Wortsman.  

Danier will hold its Annual General Meeting on Wednesday, October 
30 at 4:00 p.m. EDT at the Design Exchange in downtown Toronto. 
Shareholders and interested parties are encouraged to attend.  

About Danier 

Danier Leather Inc. is a leading integrated designer, 
manufacturer, and retailer of high-quality leather and suede 
clothing and accessories. The Company's merchandise is marketed 
exclusively under the well-known Danier brand name and is 
available only at its 90 shopping mall, street front, and power 
centre stores and online through its website, www.danier.com. 

Certain statements in this press release contain forward-looking 
statements that deal with potential future circumstances and 
developments. Forward-looking statements involve risks and 
uncertainties, including, but not limited to, the weather and 
performance of the economies in the markets in which the Company 
operates, continued acceptance of the Company's products, 
competitive factors, the Company's ability to identify and 
interpret fashion trends, factors affecting its sourcing of skins 
in Europe, New Zealand and Asia, and other such risks as we may 
identify in this release or in other published documents. 
Accordingly, there is no certainty that the Company's plans will 
be achieved.  

Investors, analysts and the media are invited to participate in a 
conference call today at 11:00 AM. Eastern Time to discuss the 
results. Please dial 1-877-323-2010 (U.S. and Canada) at least 
five minutes prior to the call. The call will also be webcast at 
www.ccnmatthews.com and at www.danier.com.  


/T/

DANIER LEATHER INC.                                              
CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) AND RETAINED EARNINGS        
(thousands of dollars, except 
earnings per share and number of shares outstanding)                    
------------------------------------------------------------------------
------------------------------------------------------------------------
                                                                        
                                                                        
                              For the 13 Weeks        For the 12 Months 
                                    Ended                   Ended 
------------------------------------------------------------------------
                             September   September  September  September 
                              28, 2002    29, 2001   28, 2002   29, 2001
------------------------------------------------------------------------    
                           (unaudited) (unaudited)(unaudited)(unaudited)           
                                                   (52 weeks) (53 weeks)                      
Revenue                       $ 22,695    $ 21,426  $ 181,246  $ 164,907
Cost of sales                   12,553      11,940     92,711     83,089
------------------------------------------------------------------------
Gross profit                    10,142       9,486     88,535     81,818
Selling, general and
 administrative expenses        15,727      13,192     71,799     62,038
------------------------------------------------------------------------
(Loss) earnings before
 interest and income taxes     (5,585)     (3,706)     16,736     19,780
Interest expense                    82         218        325        564
------------------------------------------------------------------------
(Loss) earnings before
 income taxes                  (5,667)     (3,924)     16,411     19,216
Provision for income tax       (2,295)     (1,609)      6,743      8,298
------------------------------------------------------------------------
Net (loss) earnings for
 the period                  $ (3,372)   $ (2,315)    $ 9,668   $ 10,918
------------------------------------------------------------------------
------------------------------------------------------------------------
                                                                        
Retained earnings,
 beginning of period            38,605      27,880     25,565     15,600
Share purchases                      -           -          -      (953)
------------------------------------------------------------------------
Retained earnings, end of
 period                       $ 35,233    $ 25,565   $ 35,233   $ 25,565
------------------------------------------------------------------------
------------------------------------------------------------------------
                                                                        
(Loss) Earnings per Share:                                              
Basic                          ($0.49)     ($0.34)      $1.41      $1.59
Diluted                            n/a         n/a      $1.37      $1.57
                                                                        
Weighted Average Number of
 Shares Outstanding:                                                    
Basic                        6,908,552   6,837,263  6,867,611  6,859,097
Diluted                      7,114,732   6,951,079  7,066,338  6,956,933
Number of Shares
 Outstanding                 6,909,654   6,839,329  6,909,654  6,839,329


DANIER LEATHER INC.                                              
CONSOLIDATED BALANCE SHEETS                                              
(thousands of dollars)                                              
------------------------------------------------------------------------
------------------------------------------------------------------------                                                                        
                                                                        
                                 September      September           June 
                                  28, 2002        29,2001       29, 2002
                               (unaudited)    (unaudited)                              
ASSETS                                                                  
Current Assets                                                          
 Cash                                  $ -            $ -        $ 3,777
 Accounts receivable                   592            606            484
 Income taxes recoverable            4,354          3,190              -
 Inventories (Note 3)               52,333         53,258         38,662
 Prepaid expenses                      856            390            603
 Current portion of future
  income tax asset                     670            944            628
------------------------------------------------------------------------
                                    58,805         58,388         44,154
                                                                        
Other Assets                                                            
 Capital assets (Note 4)            32,622         26,561         31,199
 Goodwill                              342            342            342
------------------------------------------------------------------------
                                  $ 91,769       $ 85,291       $ 75,695
------------------------------------------------------------------------
------------------------------------------------------------------------
                                                                        
LIABILITIES                                                             
Current Liabilities                                                     
 Bank overdraft                   $ 19,314       $ 28,129            $ -
 Accounts payable and
  accrued liabilities               10,545          6,259         10,472
 Income taxes payable                    -              -             80
------------------------------------------------------------------------
                                    29,859         34,388         10,552
Deferred lease inducements           1,966          1,400          1,837
Future income tax
 liability                             784            501            784
------------------------------------------------------------------------
                                    32,609         36,289         13,173
------------------------------------------------------------------------
                                                                        
SHAREHOLDERS' EQUITY                                                    
 Share capital (Note 5)             23,927         23,437         23,917
 Retained earnings                  35,233         25,565         38,605
------------------------------------------------------------------------
                                    59,160         49,002         62,522
------------------------------------------------------------------------
                                  $ 91,769       $ 85,291       $ 75,695
------------------------------------------------------------------------
------------------------------------------------------------------------


DANIER LEATHER INC.                                 
CONSOLIDATED STATEMENTS OF CASH FLOW                                 
(thousands of dollars)                                 
------------------------------------------------------------------------
------------------------------------------------------------------------
                                                                        
                                               For the 13 Weeks Ended   
------------------------------------------------------------------------
                                              September        September
                                               28, 2002         29, 2001
------------------------------------------------------------------------
                                            (unaudited)      (unaudited)
Operating activities                                                    
  Net loss for the period                      $(3,372)         $(2,315)
  Items not affecting cash:                                             
  Amortization                                    1,732            1,322
  Amortization of deferred lease
   inducements                                     (64)             (38)
  Future income taxes                              (42)             (42)
------------------------------------------------------------------------
                                                (1,746)          (1,073)
Change in non-cash working capital
 items (Note 7)                                (18,393)         (22,601)
------------------------------------------------------------------------
Cash flows from operating activities           (20,139)         (23,674)
------------------------------------------------------------------------
                                                                        
Financing activities                                                    
  Subordinate voting shares issued                   10               25
  Proceeds from lease inducements                   193               75
------------------------------------------------------------------------
Cash flows from financing activities                203              100
------------------------------------------------------------------------
                                                                        
Investing activities                                                    
  Acquisition of capital assets                 (3,155)          (2,732)
------------------------------------------------------------------------
Cash flows from investing activities            (3,155)          (2,732)
------------------------------------------------------------------------
                                                                        
Decrease in cash                               (23,091)         (26,306)
Cash/(bank overdraft), beginning of
 period                                           3,777          (1,823)
------------------------------------------------------------------------
Bank overdraft, end of period                 $(19,314)        $(28,129)
------------------------------------------------------------------------
------------------------------------------------------------------------
                                                                        
Supplementary cash flow information:                                    
  Interest paid                                      60              121
  Income taxes paid                               2,317            2,811



                               DANIER LEATHER INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
 For the 13 week periods ended September 28, 2002 and September 29, 2001
                                  (Unaudited)

/T/

1. SIGNIFICANT ACCOUNTING POLICIES: 

(a) Basis of Presentation: 

The interim financial statements presented herein follow the same 
accounting policies and their methods of application as the 2002 
annual financial statements, except as noted in note 1(b) below.  
Generally accepted accounting principles for interim financial 
statements do not conform in all respects to the disclosures 
required for annual financial statements, and accordingly, these 
interim financial statements should be read in conjunction with 
the Company's audited consolidated financial statements and the 
accompanying notes contained in the Company's 2002 Annual Report. 

(b) Stock-Based Compensation Plan: 

On June 30, 2002, the Company adopted prospectively the Canadian 
Institute of Chartered Accountants (CICA) Handbook section 3870 
"Stock-based Compensation and Other Stock-based Payments".  The 
new standard establishes standards for the recognition, 
measurement and disclosure of stock-based compensation to 
employees.  Options granted to employees will include full 
disclosure of pro forma net earnings and pro forma earnings per 
share, using the fair value based accounting method (see Note 
5(d)).   

(c) Comparative Figures: 

Certain of last year's figures have been reclassified to conform 
with the current year's presentation. 

2. SEASONALITY OF RETAIL OPERATIONS: 

Due to the seasonal nature of the retail business and the 
Company's product lines, the results of operations for any interim
period are not necessarily indicative of the results of operations
to be expected for the fiscal year.  Generally, a significant 
portion of the Company's sales and earnings are generated during 
the fiscal second quarter, which includes the holiday selling 
season.  Sales are generally lowest and losses are experienced 
during the period from April to September.   


/T/

3. INVENTORY (thousands of dollars):

                             September 28,  September 29,      June 29,
                                 2002          2001              2002
------------------------------------------------------------------------
Raw materials                     $  2,861       $  4,853       $  5,210
Work-in-process                      4,410          2,760          2,430
Finished goods                      45,062         45,645         31,022
------------------------------------------------------------------------
                                  $ 52,333       $ 53,258       $ 38,662
------------------------------------------------------------------------
------------------------------------------------------------------------



4. CAPITAL ASSETS (thousands of dollars): 

                      September 28, 2002           September 29, 2001   
------------------------------------------------------------------------
                        Accumulated  Net Book       Accumulated Net Book
                   Cost Amortization   Value   Cost Amortization  Value
------------------------------------------------------------------------
Land             $ 1,000       $ -    $1,000   $ 1,000      $ -  $ 1,000
Building           6,780       689     6,091     5,901      442    5,459
Furniture and
 equipment        11,416     5,867     5,549     9,519    4,642    4,877
Leasehold
 improvements     23,172     8,856    14,316    18,778    7,372   11,406
Computer
 hardware and
 software          9,739     4,073     5,666     6,829    3,010    3,819
------------------------------------------------------------------------
                 $52,107   $19,485   $32,622   $42,027 $ 15,466 $ 26,561
------------------------------------------------------------------------
------------------------------------------------------------------------
                                                                        
                          June 29, 2002                                
----------------------------------------------
                         Accumulated  Net Book
                   Cost Amortization   Value                           
----------------------------------------------
Land             $ 1,000       $ -   $ 1,000                            
Building           6,768       580     6,188                            
Furniture and
 equipment        10,953     5,529     5,424                            
Leasehold
 improvements     21,608     8,073    13,535                            
Computer
 hardware and
 software          8,623     3,571     5,052                            
----------------------------------------------
                $ 48,952  $ 17,753  $ 31,199                            
----------------------------------------------
----------------------------------------------


/T/



5. SHARE CAPITAL  (thousands of dollars, except number of shares 
and per share amounts):  

(a) Authorized: 

1,224,329 Multiple Voting Shares 

Unlimited Subordinate Voting Shares 

Unlimited Class A Preference Shares 

(b) Issued: 


/T/

                                             Sept 28,  Sept 29, June 29,
                                                2002     2001     2002
------------------------------------------------------------------------
1,224,329 Multiple Voting Shares (September 29,
 2001 and June 29, 2002 - 1,224,329)                *        *        *
5,685,325 Subordinate Voting Shares
 (September 29, 2001 - 5,615,000 and June
 29, 2002 - 5,683,875)                         23,927   23,437   23,917
------------------------------------------------------------------------
                                            $  23,927 $ 23,437 $ 23,917
------------------------------------------------------------------------
------------------------------------------------------------------------
* Nominal     

/T/

(c) Normal Course Issuer Bid: 

During the 13 weeks ended September 28, 2002 and 13 weeks ended 
September 29, 2001, there were no shares repurchased under the 
Normal Course Issuer Bid. 

(d) Stock-Based Compensation Plan: 

The Company has reserved 1,025,000 Subordinate Voting Shares for 
issuance under its Stock Option Plan.  As at September 28, 2002, 
there were 690,300 options outstanding with exercise prices 
ranging from $6.02 to $17.94.  Of these outstanding options, 
488,800 are exercisable.  Further details of the Stock Option Plan
are contained in Note 6(e) of the consolidated financial 
statements contained in the 2002 Annual Report.  

Effective June 30, 2002, the Company adopted prospectively the new
CICA standard for Stock-based Compensation (see Note 1(b)).  Under
the new standard, as in prior periods, the Company uses settlement
accounting to account for its stock option plan.  Consideration 
paid by employees and directors, which represents the exercise 
price on the exercise of stock options, is recorded as share 
capital.  

During the 13 weeks ended September 28, 2002, the Company granted 
111,000 stock options with an exercise price of $15.85.  Had 
compensation cost been determined using the fair value-based 
method at the grant date of the stock options awarded to employees
and directors, the net loss and loss per share would have been 
reduced to the pro forma amounts indicated in the following table:
  


/T/

                                     13 Weeks Ended
                                   September 28, 2002 
------------------------------------------------------------------------
                               As Reported       Pro forma 
------------------------------------------------------------------------
Net loss                         ($3,372)         ($3,519) 
Basic loss per share              ($0.49)          ($0.51) 
Diluted loss per share                n/a              n/a 

/T/

To determine compensation cost, the fair value of stock options is
recognized on a straight-line basis over the vesting period of the
options. 

The pro forma effect on net income of the period is not 
representative of the pro forma effect on net income of future 
periods because it does not take into consideration the pro forma 
compensation cost related to options awarded prior to June 29, 
2002. 

The fair value of options granted was estimated on the grant date 
using the Black-Scholes option-pricing model with the following 
assumptions for the stock options granted since the beginning of 
the year: 


/T/

        Expected dividend yield                None
        Expected volatility                     54%
        Risk-free interest rate               5.25%
        Expected life                      10 years

/T/

The fair value of stock options granted during the quarter ended 
September 28, 2002 was $11.12. 

The Black-Scholes option-pricing model was developed for use in 
estimating the fair value of traded options, which have no vesting
restrictions and are fully transferable.  In addition, the 
Black-Scholes model requires the use of subjective assumptions 
including the expected stock price volatility.  Because the 
Company's stock option plan has characteristics different from 
those of traded options, and because changes in the subjective 
assumptions can have a material effect on the fair value estimate,
the Black-Scholes option-pricing model does not necessarily 
provide a reliable single measure of the fair value of options 
granted. 

6. INCOME TAXES: 

The Company's effective income tax rate consists of the following:
 


/T/

                                            September 28,  September 29,
                                                2002           2001
------------------------------------------------------------------------
Combined basic federal and provincial
 average statutory rate                             39.0%          41.0%
Manufacturing and processing credit                (1.0%)         (2.0%)
Effect of foreign operating losses                   2.0%           1.0%
Other                                                0.5%           1.0%
------------------------------------------------------------------------
                                                    40.5%          41.0%
------------------------------------------------------------------------
------------------------------------------------------------------------

/T/

7. CHANGES IN NON-CASH OPERATING WORKING CAPITAL ITEMS (thousands 
of dollars): 


/T/

                                                   13 weeks ended 
------------------------------------------------------------------------
                                             September 28, September 29,
                                                 2002          2001 
------------------------------------------------------------------------
Accounts receivable                                 ($108)           $58 
Income tax recoverable                             (4,434)       (4,374) 
Inventories                                       (13,671)      (14,031) 
Prepaid expenses                                     (253)            69 
Accounts payable and accrued liabilities                73       (4,323) 
------------------------------------------------------------------------
                                                 ($18,393)     ($22,601) 
------------------------------------------------------------------------

/T/

8. COMMITMENTS & CONTINGENCIES (thousands of dollars): 

(a) Legal Proceedings  

In the course of its business, the Company from time to time 
becomes involved in various claims and legal proceedings.  In 
fiscal 1999, the Company and certain of its directors and officers
were served with a Statement of Claim under the Ontario Class 
Proceedings Act.  The Claim relates to subordinate voting shares 
purchased at the time of the Company's initial public offering in 
May 1998.  Essentially, the suit seeks rescission of the 
plaintiff's purchase of shares made in May, 1998, or 
alternatively, that damages be paid equal to the diminution in 
value of the shares.  In March, 2001, the Court dismissed the 
plaintiff's claim for rescission. The plaintiff also brought a 
motion to certify the action as a class action on behalf of 
investors who purchased shares pursuant to the initial public 
offering.  A motion to certify the action as a class action was 
heard in July, 2001, and in October, 2001, the motion for 
certification was granted.  The trial is expected to occur in mid 
2003.  No amounts have been provided in the accounts of the 
Company in respect of this matter.  The Company strongly believes 
the suit is wholly without merit and will vigorously defend it. 

(b) Operating Leases 

Minimum rentals for the next five years and thereafter, excluding 
rentals based upon revenue are as follows: 


/T/

2004                                           $  10,303
2005                                            $  9,752
2006                                            $  8,943
2007                                            $  8,185
2008                                            $  7,517
Thereafter                                     $  16,130

/T/

9. SEGMENTED INFORMATION: 

Management has determined that the Company operates in one 
dominant industry and geographic segment which involves the 
design, manufacture and retail of fashion leather and suede 
apparel. 

FOR FURTHER INFORMATION PLEASE CONTACT:
Danier Leather Inc.
Bryan Tatoff
Senior Vice-President and Chief Financial Officer
(416) 762-8175 ext. 328
(416) 762-7408 (FAX)
bryan@danier.com

or

Danier Leather Inc.
Jeffrey Wortsman
President and Chief Executive Officer
(416) 762-8175 ext. 302
(416) 762-7408 (FAX)
leather@danier.com