| ·   | Sales increased more than three percent to $15,908,784 |
|--------------------|--------------------------------------------------------|

| ·   | Increased marketing initiatives and retail distribution, fueling organic growth |
|--------------------|---------------------------------------------------------------------------------|

| ·   | Working capital increased approximately 4 percent to $8,842,253 |
|--------------------|-----------------------------------------------------------------|

| ·   | Recent USDA rule to exempt Kefir beverages from the Class I milk classification will positively impact Lifeway’s business starting in the first quarter 2011 |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Announced acquisition of assets of New Jersey-based First Juice, Inc., creator of the first organic fruit and vegetable juice beverages designed for children |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

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----

----

|                              |   | (Unaudited)        |         |   | (Unaudited)       |   |
|-----------------------------------|--------|--------------------|--------------|--------|-------------------|--------|
|                              |   | Three Months Ended |         |   | Nine Months Ended |   |
|                              |   | September 30,      |         |   | September 30,     |   |
|                              |   | 2010               |         |   | 2009              |   |   | 2010 |   |   | 2009 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |
| Sales                             |   |               | 15,908,784   |   |              |   | 15,433,876 |   |   |   | 47,419,499 |   |   |   | 43,649,383 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Cost of goods sold                |   |               | 9,837,171    |   |              |   | 8,892,088 |   |   |   | 27,730,041 |   |   |   | 24,994,778 |   |
| Depreciation expense              |   |               | 349,017      |   |              |   | 288,613 |   |   |   | 1,033,612 |   |   |   | 859,044 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Total cost of goods sold          |   |               | 10,186,188   |   |              |   | 9,180,701 |   |   |   | 28,763,653 |   |   |   | 25,853,822 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Gross profit                      |   |               | 5,722,596    |   |              |   | 6,253,175 |   |   |   | 18,655,846 |   |   |   | 17,795,561 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Selling expenses                  |   |               | 2,308,740    |   |              |   | 1,231,216 |   |   |   | 7,019,517 |   |   |   | 3,176,162 |   |
| General and administrative        |   |               | 1,329,803    |   |              |   | 1,613,828 |   |   |   | 4,298,024 |   |   |   | 5,173,724 |   |
| Amortization expense              |   |               | 175,760      |   |              |   | 168,699 |   |   |   | 527,280 |   |   |   | 508,086 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Total Operating Expenses          |   |               | 3,814,303    |   |              |   | 3,013,743 |   |   |   | 11,844,821 |   |   |   | 8,857,972 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Income from operations            |   |               | 1,908,293    |   |              |   | 3,239,432 |   |   |   | 6,811,025 |   |   |   | 8,937,589 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Other income (expense):           |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Interest and dividend income      |   |               | 97,697       |   |              |   | 34,180 |   |   |   | 205,381 |   |   |   | 144,899 |   |
| Rental Income                     |   |               | 4,050        |   |              |   | 12,047 |   |   |   | 8,085 |   |   |   | 33,340 |   |
| Interest expense                  |   |               | ( 86,167     | )      |              |   | ( 99,864 | ) |   |   | ( 262,274 | ) |   |   | (364,337 | ) |
| Loss on Disposition of Equipment  |   |               | –      |   |              |   | – |   |   |   | – |   |   |   | (2,825 | ) |
| Gain (loss) on sale of marketable |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
|   securities, net       |   |               | ( 1,687 | )      |              |   | (178,143 | ) |   |   | 53,097 |   |   |   | ( 274,296 | ) |
| Total other income (expense)      |   |               | 13,893       |   |              |   | ( 231,780 | ) |   |   | 4,289 |   |   |   | ( 463,219 | ) |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Income before provision for       |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
|    income taxes    |   |               | 1,922,186    |   |              |   | 3,007,652 |   |   |   | 6,815,314 |   |   |   | 8,474,370 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Provision for income taxes        |   |               | 1,017,349    |   |              |   | 1,636,911 |   |   |   | 2,957,285 |   |   |   | 3,024,261 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Net income                        |   | $                  | 904,837      |   |              | $      | 1,370,741 |   |   | $ | 3,858,029 |   |   | $ | 5,450,109 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Basic and diluted earnings        |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| per common share                  |   |               | 0.05         |   |              |   | 0.08 |   |   |   | 0.23 |   |   |   | 0.32 |   |
|                              |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average number of        |   |               |         |   |              |   |   |   |   |   |   |   |   |   |   |   |
|   shares outstanding    |   |               | 16,625,718   |   |              |   | 16,798,623 |   |   |   | 16,696,142 |   |   |   | 16,799,134 |   |

----

|                                                      |   | (Unaudited)   |          |   |         |   |
|-----------------------------------------------------------|--------|---------------|---------------|--------|--------------|--------|
|                                                      |   | September 30, |          |   | December 31, |   |
|                                                      |   | 2010          |          |   | 2009         |   |   | 2009 |   |
|                                                      |   |          |          |   |         |   |   |   |   |
| Cash flows from operating activities:                     |   |          |          |   |         |   |   |   |   |
| Net income                                                |   | $             | 3,858,029     |   |         | $      | 5,450,109 |   |   | $ | 5,569,702 |   |
| Adjustments to reconcile net income to net                |   |          |          |   |         |   |   |   |   |   |   |   |
| cash flows from operating activities, net of acquisition: |   |          |          |   |         |   |   |   |   |   |   |   |
| Depreciation and amortization                             |   |          | 1,560,893     |   |         |   | 1,367,130 |   |   |   | 1,811,190 |   |
| (Gain) Loss on sale of investments, net                   |   |          | ( 53,097 | )      |         |   | 274,296 |   |   |   | 278,474 |   |
| Loss on disposition of assets                             |   |          | –       |   |         |   | 2,825 |   |   |   | 2,826 |   |
| Deferred income taxes                                     |   |          | ( 392,966     | )      |         |   | 236,063 |   |   |   | 389,754 |   |
| Treasury stock issued for compensation                    |   |          | 62,318        |   |         |   | 113,477 |   |   |   | 144,636 |   |
| Decrease in allowance for doubtful accounts               |   |          | –       |   |         |   | – |   |   |   | ( 75,000 | ) |
| (Increase) decrease in operating assets:                  |   |          |          |   |         |   |   |   |   |   |   |   |
| Accounts receivable                                       |   |          | 1,795,921     | )      |         |   | ( 2,000,033 | ) |   |   | ( 612,915 | ) |
| Other receivables                                         |   |          | ( 12,532 | )      |         |   | 2,599 |   |   |   | ( 7,758 | ) |
| Inventories                                               |   |          | (1,212,177    | )      |         |   | ( 636,236 | ) |   |   | 173,419 |   |
| Refundable income taxes                                   |   |          | 1,308,978     |   |         |   | 807,067 |   |   |   | ( 475,635 | ) |
| Prepaid expenses and other current assets                 |   |          | 3,577         |   |         |   | 4,660 |   |   |   | 9,506 |   |
| Increase (decrease) in operating liabilities:             |   |          |          |   |         |   |   |   |   |   |   |   |
| Accounts payable                                          |   |          | ( 55,466 | )      |         |   | ( 284,927 | ) |   |   | 298,800 |   |
| Accrued expenses                                          |   |          | 125,638       |   |         |   | 167,114 |   |   |   | 96,062 |   |
| Accrued income taxes                                      |   |          | 567,926       |   |         |   | – |   |   |   | – |   |
| Net cash provided by operating activities                 |   |          | 3,965,200     |   |         |   | 5,504,144 |   |   |   | 7,603,061 |   |
|                                                      |   |          |          |   |         |   |   |   |   |   |   |   |
| Cash flows from investing activities:                     |   |          |          |   |         |   |   |   |   |   |   |   |
| Purchases of investments                                  |   |          | (1,809,171    | )      |         |   | (6,050,202 | ) |   |   | ( 6,156,682 | ) |
| Proceeds from sale of investments                         |   |          | 2,868,975     |   |         |   | 6,792,962 |   |   |   | 6,928,321 |   |
| Proceeds from redemption of certificates of deposit       |   |          | 202,545       |   |         |   | – |   |   |   | – |   |
| Purchases of property and equipment                       |   |          | (1,681,740    | )      |         |   | (1,020,776 | ) |   |   | ( 1,766,280 | ) |
| Acquisition of Fresh Made, net of cash acquired           |   |          | –       |   |         |   | ( 3,442,546 | ) |   |   | (11,042,546 | ) |
| Net cash used in investing activities                     |   |          | ( 419,391     | )      |         |   | (3,720,562 | ) |   |   | (12,037,187 | ) |
|                                                      |   |          |          |   |         |   |   |   |   |   |   |   |
| Cash flows from financing activities:                     |   |          |          |   |         |   |   |   |   |   |   |   |
| Proceeds of note payable                                  |   |          | 250,000       |   |         |   | 1,753,504 |   |   |   | 9,353,504 |   |
| Checks written in excess of bank balances                 |   |          | 659,125       |   |         |   | – |   |   |   | 342,976 |   |
| Purchases of treasury stock                               |   |          | (2,059,911    | )      |         |   | ( 905,607 | ) |   |   | ( 905,607 | ) |
| Repayment of notes payable                                |   |          | (2,175,773    | )      |         |   | (2,104,340 | ) |   |   | ( 4,003,588 | ) |
| Net cash (used in) provided by in financing activities    |   |          | (3,326,559    | )      |         |   | (1,256,443 | ) |   |   | 4,787,285 |   |
|                                                      |   |          |          |   |         |   |   |   |   |   |   |   |
| Net increase in cash and cash equivalents                 |   |          | 219,250       |   |         |   | 527,139 |   |   |   | 353,159 |   |
|                                                      |   |          |          |   |         |   |   |   |   |   |   |   |
| Cash and cash equivalents at the beginning of the period  |   |          | 630,407       |   |         |   | 277,248 |   |   |   | 277,248 |   |
|                                                      |   |          |          |   |         |   |   |   |   |   |   |   |
| Cash and cash equivalents at the end of the period        |   | $             | 849,657       |   |         | $      | 804,387 |   |   | $ | 630,407 |   |

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