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Winner Medical Reports Fourth Quarter and Fiscal 2010 Results
Date:12/8/2010

tting down their manufacturing facilities.

PurCotton Business Update:

PurCotton sales grew 85.2% during the fiscal year 2010, to $10.1 million, and benefitted from increased sales of the Company's PurCotton® jumbo rolls and retail sales from customers in China.

As of December 8, 2010, Winner Medical owned and operated 23 PurCotton chain stores in major cities in Guangdong Province, including Shenzhen, where the corporate headquarters are located. PurCotton stores are primarily located in downtown shopping malls, and range in size from 50 to 180 square meters. In order to build a healthy and sustainable retail business, the Company slowed the pace of stores openings during the third quarter. After a quarter's careful evaluation of store location and size, product packaging and pricing, brand image, customer service and marketing, the Company has clearer operating and financial metrics. The Company started opening new stores in Guangzhou and other main cities in Guangdong province. It plans to open new stores in Beijing and Shanghai in December 2010.

In July 2010, the Company opened its first online PurCotton store http://purcotton.mall.taobao.com, featuring its entire array of products on Taobao.com, the largest online trading platform in China. This is the Company's first initiative to establish PurCotton Business-to-Consumer ("B2C") online stores in order to address the consumers' evolving shopping preferences. In September 2010, the Company also built its own B2C trading website, www.purcotton.com, which is co-branded through its retail stores. Management expects these online initiatives to further strengthen PurCotton's brand awareness and contribute meaningfully to PurCotton sales in fiscal 2011.

The Company also launched its new distribution channels for PurCotton business, which are direct sales to supermarkets and wholesale
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SOURCE Winner Medical Group Inc.
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