Charles & Colvard released disappointing sales results for the first quarter of 2014: Sales fell 7 percent, and the company posted a loss.
While the moissanite manufacturer’s U.S. sales climbed 12 percent, its international business fell a whopping 74 percent, due to one big customer not placing an order. It also posted a $1.1 million loss for the quarter, compared to a $300,000 profit the previous year.
“We do not believe the financial results for the first quarter represent our future growth opportunity,” said CEO Randy McCullough in a conference call following the release of the company’s financial results, noting the company has made a number of new hires, particularly in sales and e-commerce. “We continue to believe there is a large market for our gem.”
Later he added, in response to a frustrated analyst: “We are a growing company, and like any growing company you are going to have quarters that are really good and quarters that aren’t so good.… I am shareholder too, a large one. And believe me, I am just as upset about the market as you are. But I am in for the long haul.”
He said he would be talking to major retailers at the upcoming JCK Las Vegas show in order to win another solid retail account like Kohl’s.com.
On the positive side, the company’s direct to consumer businesses—moissanite.com and home sales channel Lulu Avenue—increased 89 percent to hit $900,000, or about 15 percent of the company’s overall sales.
Highlights of the company’s financial results:
- Net sales: Down 7 percent, to $6.1 million
- U.S. net sales: Up 12 percent, to $5.7 million
- International sales: Down 74 percent, to $359,000
- Loose jewel sales: Down 15 percent, to $3.7 million
- Finished jewelry sales: Up 11 percent, to $2.4 million