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RAPAPORT... Charles & Colvard Ltd. reported that revenue fell 7 percent year on year to $6.1 million in the first quarter that ended on March 31. However, U.S. sales rose 12 percent to $5.7 million, primarily due to an increase in the brand's direct-to-consumer business. International sales fell to just $400,000 compared with $1.4 million one year ago.
Loose jewel sales, including moissanite and Forever Brilliant® moissanite, fell 15 percent to $3.7 million, while finished jewelry sales rose 11 percent to $2.4 million. Revenue from its wholesale business fell to $5.2 million compared with $6 million one year ago. Operating expenses rose 16 percent to $3.6 million and Charles & Colvard reported a loss of $1.1 million or 5 cents per share, compared with profit of $300,000 or 2 cents per share in the first quarter of 2013.
“We do not believe the financial results for this quarter represent our long term growth opportunity,” said Randy N. McCullough, the CEO of Charles & Colvard. “Looking forward, we are carefully planning for our future growth by continuing to make strategic investments in time, infrastructure, marketing and customer support. Operationally and resource-wise we believe we are well positioned with a strong foundation designed to support our growing business divisions, while reducing our inventory and increasing our cash position throughout 2014. Therefore, I am more enthusiastic than ever before about the future of Charles & Colvard.” Charles & Colvard closed the first quarter with no debt outstanding and inventory, including long-term and consigned inventory, valued at $43.7 million, compared with $42.4 million on December 31.
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