Highlights of Charles & Colvard’s third quarter (ended
September 30) results:

• Q3 Net Sales: $3 million, up 40 percent from Q3
  2009.
• Q3 Net Income: $511,953, 1.1 million improvement
  relative to a net loss “as adjusted” of $569,367 in Q3 2009.
• First nine months of FY 2010 Net Sales:  $9.2 million, up 54 percent from 2009.
• First nine months of FY 2010 Net Income: $1,146,652, approximate $4.2
  million improvement relative to a net loss “as adjusted” of $3,092,877 in 2009

“Over the past three quarters, we have returned to
profitability, achieved an impressive sales turnaround, restored positive cash
flow from operations, resolved legacy issues that had damaged customer loyalty,
and greatly strengthened our channel partner relationships,” said Randy N.
McCullough, CEO of Charles & Colvard in a statement. “Store-level training
programs have been developed, enterprise-level IT systems installed, and
operational controls implemented, thereby providing critical tools that can
support new sales initiatives, more efficient production, and improved
profitability as we expand our channels of distribution.”

For more information on Charles & Colvard’s financial
statement, click here.

JCK