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

utures markets. As a long-term strategy, the Company is focused on upgrading its medical products and expanding its PurCotton® retail business. Both businesses have gross margins higher than other medical products the Company produces and by increasing their proportion in the Company's business mix, the Company expects to achieve a higher overall gross margin.

Manufacturing linesAs of November 30, 2011, Winner Medical has four PurCotton® jumbo roll manufacturing lines which are producing at almost 100% capacity, with a total production capacity of 430 tons per month. The Company also purchased one sanitary napkin manufacturing line, which produces PurCotton top layer sanitary napkins. This line started trial production at the end of October 2011. The Company estimates that sanitary napkins will be mainly sold through distributors to hypermarkets, supermarkets, convenience stores and mother and baby stores. In January 2011, the Company established Winner (Huanggang) Cotton Processing, Co. Ltd. to process seed cotton and supply for own use. The Company expects that self-processing seed cotton will allow for more stringent quality control and reduce raw material production costs. This cotton processing line is currently meeting approximately 30% of the Company's annual cotton production needs.

PurCotton Retail BusinessAs of November 30, 2011, Winner Medical owns and operates 44 retail stores, with 24 in Guangdong province, where the Company's headquarters is located, 10 in Beijing, 7 in Shanghai and 3 in Hong Kong. The stores have an average size of 50-200 square metres, and all are located in downtown shopping malls. Since the Company launched its customer membership system in November 2010, approximately 27,000 customers have registered as members in its retail stores. Customer membership requires filling out an application form and paying a membership fee of RMB30 (or approximately $4.7), which allows members to enjoy an
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SOURCE Winner Medical Group Inc.
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