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For Immediate Release

Watsons reveals third generation store at Pacific Place
Target to reach 700 stores in Asia by end of 2003

Hong Kong, 2 June 2003 - Watsons Your Personal Store, Asia's largest personal care chain today celebrated the opening of its third generation store in Hong Kong. The new store at Pacific Place showcases the new generation of Watsons featuring an enhanced shopping experience, additional professional health and beauty services, a new range of products and more, to cater for the changing personal care needs of customers.

The new 4,000 square-foot store kicks off Watsons' major expansion plan in Asia including refurbishment of its current network of 676 stores in the region. The new store is carefully designed to bring a bright, contemporary and spacious feel to the store and lift the customer shopping comfort to a new level.

"The opening of our third generation store at Pacific Place marks an important milestone for Watsons. We have added many exciting elements into the new Watsons to create a more energetic and enjoyable shopping experience, as well as ensuring that the store presents a caring retail environment for consumers," said Andrew Miles, Chief Executive Officer for Health & Beauty Asia, AS Watson Group.

"Despite the latest impact of SARS in the region, we are optimistic about reaching our 700 stores target in Asia by year end," said Miles.

At the Pacific Place store, Watsons has expanded its Health & Beauty consultancy services. It is the first personal care chain to introduce its in-store beauty consultants who are brand bias-free to provide professional beauty and skincare advice to customers. A personal beauty consultation counter has been built in the new store. The beauty consultancy service received extremely positive feedback from customers since it was launched as a pilot programme at the chain's Capitol Centre store in Causeway Bay.

"We strongly believe that customers will enjoy visiting our stores even more. It is our mission to help customers 'Look Good, Feel Great and Have Fun!' at Watsons Your Personal Store," added Miles. "We planned to roll out five other third generation stores in the next few months by refitting stores in key locations."

About Watsons

Established in 1828, Watsons is the largest personal care retail chain in Asia operating 676 stores in Hong Kong, Taiwan, Mainland China, Macau, Singapore, Thailand, Malaysia and the Philippines. Building on its long-standing reputation for quality and innovation, plus a high degree of consumer confidence, Watsons caters to a variety of lifestyles with an unrivalled diversity of products.

Watsons is the flagship retail brand and a member of the AS Watson Group (ASW), a wholly-owned subsidiary of Hutchison-Whampoa Limited. ASW is an international retail and manufacturing company with operations in 15 countries in Asia and Europe. In 2002, the Group acquired Europe's leading health and beauty retail company Kruidvat and quickly expanded its store portfolio to over 3,000. The acquisition makes ASW the world's third largest health and beauty retailer.

In Hong Kong, Watsons has won a number of customer service awards and operates 142 stores with over 1,600 employees. Thirty-four Watsons stores have licensed pharmaceutical counters, making it the leading pharmacy chain in town.