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Winner Medical Reports Full Fiscal Year 2011 Results
Date:11/30/2011

ition and demand for our quality products, despite a challenging macro environment of tightened credit in Europe and rising raw material prices in China."

Mr. Li continued, "In the past year, we have continued to build up our sales network of retail stores for PurCotton® products in China and Hong Kong to a total of 44 stores. We also strengthened the management of our two online sales channels. As more customers have come to appreciate our PurCotton® consumer products, we have seen an over 50% repurchase rate among members. In fiscal year 2012, we plan to open around 30 new stores mostly in first- and second-tier cities and upgrade our existing stores. We expect to have a rapid increase in customer memberships and revenue increases from online platforms and distributors entering into hypermarkets, supermarkets and convenience stores, etc., with consumable goods such as sanitary napkins, baby diapers and cotton tissues. During this time of expansion, our operating and net margins will be under some pressure, but we believe this investment will better position the Company for enhanced profitability in the future."

Mr. Xiuyuan Fang, chief financial officer of Winner Medical, added, "We are pleased to have maintained positive gross profit growth throughout fiscal year 2011, when cotton prices greatly fluctuated. Our gross margin declined slightly to 27.3% from 30.0% in the same period last year. This was mainly because of an increase of the average purchasing price of cotton. Furthermore, to increase sales of PurCotton® products, we sacrificed a degree of gross margin in exchange for larger market share. We believe that in the end, such gains in the market will reward investors with increased shareholder value."

Fiscal Year 2011 Financial Performance Revenues in fiscal year 2011 increased by 30.3% to $149.9 million from $115.0 million in fiscal year 2010. The increase was mainly attributable to growing sales in North and South
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SOURCE Winner Medical Group Inc.
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