Charles & Colvard Ltd, the global source of moissanite, a created jewel available for use in fine jewelry, today reported second quarter 2007 operating results.
For the three months ended June 30, 2007, net sales decreased 11% to $7.6 million as compared to $8.5 million in the second quarter of 2006. Gross profit decreased 14% to $5.5 million compared to $6.4 million in the prior year period. Operating income for the three months ended June 30, 2007 decreased 47% to $889,000 from $1.7 million for the same period in 2006.
Net income for the second quarter of 2007 decreased 52% to $529,000, or $0.03 per diluted share, compared to net income of $1.1 million, or $0.06 per diluted share, in the comparable period of 2006.
Bob Thomas, President and Chief Executive Officer commented, “Our second quarter sales results reflect a number of factors, including a weak overall jewelry retail environment. Sales of moissanite jewels to our top four direct customers, which represented 71% of total sales, were down 18% in the second quarter compared to the prior year. At the same time, sales to our remaining direct customers were up 14% over the same quarter last year.
As we continue to build transparency with our manufacturing and retailing partners, we see that inventory levels at retail are high, therefore replenishment orders to support retail sales are smaller than would normally be expected.
In addition, our anticipated chain wide rollout at Sears scheduled for the second half of fiscal 2007 has been delayed in order to provide additional time to test our moissanite category at the 150 Sears locations where it is currently available. As a result of all these factors, we are adjusting our annual revenue expectation to a range of $35 million to $38 million for the full 2007 fiscal year.”
Charles & Colvard Ltd, based in the Research Triangle Park area of North Carolina, is the global sole-source of lab-created moissanite, a unique, near-colorless jewel that is distinct from other gemstones and jewels based on its exceptional fire, brilliance, luster, durability and rarity.
marketing@alchempro.com
