Charles & Colvard, Ltd. (CTHR) - 500 Beiträge pro Seite

[panik]

Profile:Charles & Colvard, Ltd. engages in the manufacture, marketing, and distribution of moissanite jewels. It offers near-colorless moissanite jewels cut in round, princess, radiant, oval, marquise, heart, cushion, square brilliant, octagon, baguette, castle, triangle, pear, and trillion shapes, as well as offers green moissanite jewels. The company sells its products through single-and multiple-location independent jewelry stores, jewelry store chains, online, television shopping channels, and in catalogs. It operates in the United States, western Europe, Australia, and India, as well as in southeast Asia and the Middle East. The company was founded in 1995 and is based in Morrisville, North Carolina.

http://www.moissanite.com/

[panik]

Charles & Colvard, Ltd.: The Non-Blood Diamond
Posted on Jul 10th, 2007 with stocks: CTHR

Laura Goldman submits: I believe what you wear is a reflection of who you are, and as a result I stopped wearing the diamonds that I own because they were just not worth the hassle or cost. Especially after the debut of Leo Di Caprio’s movie, “Blood Diamond”, my social activist friends were constantly criticizing me for wearing diamonds. In their opinion, my miniscule diamonds bought years ago were responsible for the financing all of the Third World oppression and genocide.

I decided to make a fashion statement that I cared about the world that I live in and took to wearing jewelry made from Moissanite. This stone costs about one tenth the price of a real diamond and has similar thermal conductivity.

When I was at my jeweler last month, he mistook on initial glance my moissanite ring for a real diamond. Moissanite is a gem quality silicon carbide. It was originally discovered in meteorites at Canyon Diablo in Arizona more than one hundred years ago. According to Charles & Colvard Ltd.’s (CTHR) website, “you have never seen a jewel on earth with more fire, brilliance, and sparkle than moissanite. Even diamond dealers concede that it has more sparkle than an average diamond."

A North Carolina company, Charles & Colvard creates this stone in the laboratory now and are the only producers in the world. A patent on the creation process affords them protection for the next ten years. As a stock jockey, I am always thrilled to buy the only producer in a field. A monopolistic producer can raise prices as he sees fit because there is no competition. This may be the reason for the current high pricing of this crystal like stone.

For many reasons, the time is right to buy Charles & Colvard stock which is trading at $4.60 down from $26 at the end of 2005. That year, sales had peaked at $43 million. The company earned spot number 54 on Fortune Magazine’s list of the 100 fastest growing small public companies in 2006.

After that, the company ran into some trouble. The Federated – May department store merger resulted in a loss of 40 outlets for the company because both Federated and May had previously sold jewelry made form moissanite. Trying to go head to head against the diamond cartel resulted in a migraine for Charles & Colvard. The diamond industry fought back with a vengeance against their marketing campaign to be the “fake” diamond. The company ended up with much excess inventory that could not be moved.

Now, Charles & Colvard concedes the market for "I love you therefore I buy diamonds" to De Beers and the other diamond dealers. Instead they are now targeting the independent woman that buys for herself. Women presently control five trillion dollars of spending each year and their economic strength keeps multiplying. You could say that this stock is a call option on women’s liberation.

While the demographics are in their favor, only 8% of the world has even heard of this stone. There is plenty of room for growth. The company has began to advertise in Allure, Marie Claire, Self and Vogue. Television commercials have sparked enough curiosity to bring potential customers through the door. Right now, the company sells through JC Penney’s, army and air force exchanges around the world, fine jewelry counters at major department stores, and some regional jewelry chains. They are test marketing products at three divisions of Zales, the largest jewelry retailer in North America.

Costume jewelry is now in fashion for women of all ages. It used to be the province of young girls but now every one is wearing fakes. For example, the Candace Bergen character on the television show “Boston Legal”, a rich successful partner in a law firm, only wears costume jewelry. Sarah Ferguson, the Duchess of York, is the new spokeswoman for Charles & Colvard.

There is not much analyst coverage of this small cap stock with a market capitalization of just $83 million. This is the preferred situation for the buyer of a thinly traded stock. You want to get in before the analysts write and raise the price.

Northland Securities, a small brokerage firm from Minnesota, just initiated coverage on Charles & Colvard with an outperform rating and a price of $8, almost double the current price.

Chris Krueger of Northland thinks that the company can eventually capture 1% of the US jewelry market and achieve $300 million in sales. But in any case, the worst is over for this company.

I am buying the stock of Charles & Colvard as a long term investment.

[scopus]

bizjournals.com
Analyst initiates coverage, sees value in moissanite maker
Thursday June 14, 5:42 pm ET


Shares of Morrisville jewelry manufacturer Charles & Colvard shot up more than 8 percent Thursday after an analyst initiated coverage with a rating of \"outperform\" and a 52-week target price of $8, nearly double the stock\'s current price.

Chris Krueger, senior analyst at Northland Securities, wrote bullishly on Charles & Colvard\'s primary product, the synthetic, diamond-like gem moissanite. His report states that Charles & Colvard eventually can meet its goal of capturing 1 percent of the U.S. jewelry market, which would give it $300 million in annual sales.

\"We believe (Charles & Colvard) is at an early stage of growth and has a large market opportunity over the next decade,\" Krueger wrote. \"... We believe continued growth will occur through increased awareness of the product.\"

Krueger\'s report also said Charles & Colvard, which has saw its stock price plummet from around $30 at the start of 2006 as the company consistently failed to meet analysts\' earnings expectations, now has undervalued shares and can be considered a growth stock.

Shares of Charles & Colvard (Nasdaq: CTHR - News) closed up 8.7 percent Thursday to $4.62.

Published June 14, 2007 by the Triangle Business Journal

[scopus]

[icemen]

Revenue (from 1997 to 2006) $Mil

[scopus]

bin gesterm eingestiegen

[scopus]

[scopus]

der chart ist lecker!

[50bager]

leider sehr schwache zahlen!


bizjournals.com
Slumping sales slice Charles & Colvard earnings in half
Monday July 23, 5:38 pm ET


Jewel maker Charles & Colvard Ltd. on Monday blamed a weak retail environment for sagging second-quarter sales and a 52 percent reduction in profit.
The Morrisville company, the world's only producer of the diamond-like, man-made jewel moissanite, reported second quarter net income of $529,000, or 3 cents per share - half of the $1.1 million net income, or 6 cents per share, Charles & Colvard (Nasdaq: CTHR) posted in the second quarter of 2006.

ADVERTISEMENT


Revenue for the three months ended June 30 fell 11 percent to $7.6 million. Charles & Colvard's top four customers, which represent 71 percent of total sales, cut their spending on moissanite by 18 percent as retail inventories remained high in the second quarter. Charles & Colvard CEO Bob Thomas also had blamed a 78 percent drop in 2007 first quarter profit on bigger-than-average inventory levels.

The company also cut its sales outlook for the year, citing a delay in rolling out moissanite across the Sears chain. Charles & Colvard originally planned to begin chain-wide sales in the second half of this year, but the company instead has decided to continue testing at the 150 Sears stores that currently sell moissanite. Charles & Colvard did not set a new date for the rollout, but did roll back its 2007 revenue projection to between $35 million and $38 million.

Analysts polled by Thomson Financial had been projecting 2007 second-quarter earnings of 6 cents a share on $8.4 million in revenue. The analysts had been expecting full-year 2007 revenue of $43.56 million.

Investors did not react well to the earnings report, dropping Charles & Colvard shares 8.65 percent to $4.75 in after-hours trading.

Published July 23, 2007 by the Triangle Business Journal

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Charles & Colvard Reports Fiscal Second Quarter 2007 Financial Results
Monday July 23, 4:01 pm ET


MORRISVILLE, N.C.--(BUSINESS WIRE)--Charles & Colvard, Ltd. (NASDAQ: CTHR - News), 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."

Sales are expected to trend stronger in the second half compared to the first half, with a larger percentage expected in the fourth quarter as retailers accelerate their rollout for the holiday season and the total moissanite door count at Kohl's continues to ramp up.

Gross profit margins in the second quarter were 72.5%, and the Company believes that they will remain in the range of 65% to 75%. Furthermore, the company expects that full year marketing and sales expense will be in the range of approximately 43% to 48% of total net sales. The expectation for sales and marketing expense for fiscal 2007 has increased on a percentage basis as the Company will be supporting revenue initiatives at a higher level than last year.

Mr. Thomas concluded, "This has been a challenging period for our business but we remain very strong believers in our brand and the overall strength of our fine moissanite jewelry. We continue to develop compelling marketing initiatives that we expect will increase customer awareness and demand for our moissanite jewels and for moissanite jewelry. Indeed, while our sales of moissanite jewels this year have been below our initial expectations, we expect retail sales of moissanite jewelry to improve.

In order to build awareness and sales at the retail level, we have planned several new, exciting advertising and marketing initiatives among the larger moissanite retailers. We are also pursuing additional retail opportunities to expand our distribution both in the U.S. and abroad. We are encouraged by the potential of our business and believe our initiatives will improve our prospects for growth in the years to come."

Charles & Colvard's domestic sales in the second quarter decreased 12% to $6.3 million compared to the second quarter of 2006. International sales for the second quarter decreased 8% to $1.2 million, with strong results from Thailand and Taiwan offset by reduced sales to Canada. Total shipments of 46,800 carats for the current period were 9% less than the 51,100 carats shipped in the same period of 2006. Shipments of carats in the U.S. decreased 7% while international shipments of carats decreased 15%.

At June 30, 2007 total inventory (including consignment) increased by $2.4 million compared to March 31, 2007 primarily due to the level of raw material purchases. The Company's raw material inventories of silicon carbide crystals are purchased under exclusive supply agreements with a limited number of suppliers. Because the supply agreements restrict the sale of these crystals to only the Company, the suppliers negotiate minimum purchase commitments with the Company that may result in periodic levels of raw and in-process inventories that are higher than the Company might otherwise maintain.

Share and per share data for all periods presented reflect the effect of the one share for every four shares owned stock split, effected in the form of a 25% stock dividend, distributed on January 30, 2006.

Conference Call

The Company will hold a conference call with senior management to discuss the financial results at 4:45 p.m. EDT on July 23, 2007. Interested parties may participate in the call by dialing 913-981-4911. The conference call will also be broadcast live over the Internet. To listen to the live webcast of the event, please go to www.moissanite.com and click on the Investor Relations section where conference calls are posted. Please go to the website 15 minutes early to download and install any necessary audio software. A replay of the call will be available from July 23, 2007 through July 30, 2007. To access the telephone replay, participants should dial [phone]. The access code for the replay is 2216704.

About Charles & Colvard, Ltd.

Charles & Colvard, Ltd. (NASDAQ: CTHR - News), 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. Currently used in fine jewelry, Charles & Colvard created Moissanite(TM) is primarily marketed to the self-purchasing woman as the perfect reward or indulgence for a woman celebrating her achievements, whether personal or professional, big or small. For more information, please access www.moissanite.com or www.charlesandcolvard.com.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements expressing expectations regarding our future and projections relating to products, sales, revenues and earnings are typical of such statements and are made under the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about our plans, objectives, representations and contentions and are not historical facts and typically are identified by use of terms such as "may," "will," "should," "could," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue" and similar words, although some forward-looking statements are expressed differently.

All forward-looking statements are subject to the risks and uncertainties inherent in predicting the future. You should be aware that although the forward-looking statements included herein represent management's current judgment and expectations, our actual results may differ materially from those projected, stated or implied in these forward-looking statements as a result of many factors, including, but not limited to the Company's ability to manage growth effectively, dependence on Cree, Inc. as the current supplier of the substantial majority of the raw material, ability to develop a material second source of supply, dependence on a limited number of jewelry manufacturing customers, dependence on continued growth and consumer acceptance of the Company's products, in addition to the other risks and uncertainties described in more detail in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made. We undertake no obligation to update or revise such statements to reflect new circumstances or unanticipated events as they occur except as required by the federal securities laws, and you are urged to review and consider disclosures that we make in the reports that we file with the Securities and Exchange Commission that discuss other factors relevant to our business.

Charles & Colvard, Ltd.
Condensed Consolidated Statements of Operations
(Unaudited)

Three Months Ended Six Months Ended
June 30, June 30,
----------------------- -----------------------
2007 2006 2007 2006
----------- ----------- ----------- -----------

Net sales $ 7,582,133 $ 8,513,270 $13,362,799 $16,530,103
Cost of goods sold 2,084,015 2,126,440 3,433,635 4,236,183
----------- ----------- ----------- -----------
Gross profit 5,498,118 6,386,830 9,929,164 12,293,920
----------- ----------- ----------- -----------

Operating expenses:
Marketing and sales 3,459,249 3,594,676 6,135,416 6,115,467
General and
administrative 1,136,953 1,104,411 2,288,910 2,135,096
Research and
development 13,234 15,562 28,872 36,158
----------- ----------- ----------- -----------
Total operating
expenses 4,609,436 4,714,649 8,453,198 8,286,721
----------- ----------- ----------- -----------

Operating income 888,682 1,672,181 1,475,966 4,007,199

Interest income 153,188 203,506 324,816 408,528
----------- ----------- ----------- -----------

Income before income
taxes 1,041,870 1,875,687 1,800,782 4,415,727

Income tax expense 512,892 779,891 932,520 1,795,684
----------- ----------- ----------- -----------

Net income $ 528,978 $ 1,095,796 $ 868,262 $ 2,620,043
=========== =========== =========== ===========

Net income per share:
Basic $ 0.03 $ 0.06 $ 0.05 $ 0.14
=========== =========== =========== ===========
Diluted $ 0.03 $ 0.06 $ 0.05 $ 0.14
=========== =========== =========== ===========

Weighted-average common
shares:
Basic 18,061,603 18,208,441 18,024,275 18,259,811
=========== =========== =========== ===========
Diluted 18,289,008 18,728,997 18,291,466 18,829,721
=========== =========== =========== ===========

Note

Share and per share data for all periods presented reflect the effect of the one share for every four shares owned stock split, effected in the form of a 25% stock dividend, distributed on January 30, 2006.

Charles & Colvard, Ltd.
Condensed Consolidated Balance Sheets
(Unaudited)

June 30, 2007 December 31, 2006
--------------- -----------------

Assets
Current Assets:
Cash and equivalents $ 9,598,577 $ 13,762,786
Accounts receivable 10,489,766 14,320,672
Interest receivable 12,618 16,381
Notes receivable 391,020 376,030
Inventory 20,212,000 20,677,215
Inventory on consignment 1,904,568 2,023,542
Prepaid expenses 645,021 783,989
Deferred income taxes 581,163 583,322
--------------- -----------------

Total current assets 43,834,733 52,543,937

Long Term Assets
Notes Receivable --- 23,970
Inventory 18,113,858 11,808,140
Furniture and equipment, net 660,172 651,134
Patent and license rights, net 300,816 288,171
Deferred income taxes 982,968 686,621
--------------- -----------------
Total long term assets 20,057,814 13,458,036
--------------- -----------------

Total assets $ 63,892,547 $ 66,001,973
=============== =================

Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable:
Cree, Inc. $ 1,272,701 $ 1,598,956
Other 1,146,364 2,870,752
Income taxes payable --- 413,387
Accrued payroll 258,263 322,383
Accrued co-op advertising 812,653 1,275,041
Accrued expenses and other
liabilities 527,118 244,539
--------------- -----------------

Total current liabilities 4,017,099 6,725,058

Long Term Liabilities 1,012,903 ---
--------------- -----------------
Total liabilities 5,030,002 6,725,058

Commitments and contingencies

Shareholders' Equity 58,862,545 59,276,915
--------------- -----------------

Total liabilities and
shareholders' equity $ 63,892,547 $ 66,001,973
=============== =================



Contact:
Charles & Colvard Ltd.
Jim Braun, 919-468-0399 Ext. 224
Chief Financial Officer
[e-mail]
or
Investor Relations:
Integrated Corporate Relations
Bill Zima, 203-682-8200
[e-mail]

--------------------------------------------------------------------------------
Source: Charles & Colvard, Ltd.

[50bager]

das war wohl nichts!!

schwache zahlen!

Charles & Colvard Reports Fiscal Third Quarter 2007 Financial Results
Tuesday October 23, 4:01 pm ET


MORRISVILLE, N.C.--(BUSINESS WIRE)--Charles & Colvard, Ltd. (NASDAQ: CTHR - News), the global source of moissanite, a created jewel available for use in fine jewelry, today reported third quarter 2007 operating results.
ADVERTISEMENT


For the three months ended September 30, 2007, net sales decreased 46% to $6.6 million as compared to $12.1 million in the third quarter of 2006. Gross profit for the quarter decreased 42% to $4.9 million compared to $8.3 million in the prior year period. Gross margin increased 520 basis points to 74.1% compared to 68.9% as a result of lower production costs. Operating income for the three months ended September 30, 2007 decreased 84% to $560,000 from $3.5 million for the same period in 2006.

Net income for the third quarter of 2007 decreased to $246,000, or $0.01 per diluted share, compared to net income of $2.2 million, or $0.12 per diluted share, in the comparable period of 2006.

Bob Thomas, Chairman and Chief Executive Officer commented, “Our results for the third quarter have not met our expectations. The factors that negatively affected the third quarter are a continuation of what has transpired in our business during the first half of the fiscal year. Moissanite customer orders continue to be slow due primarily to ongoing higher than average inventory levels among our direct manufacturing customers and at the retail level. Additionally, the economic environment for some of our domestic jewelry manufacturing customers is becoming more challenging, with increased foreign competition and consolidation within the domestic industry. We also did not experience significant sell-in revenue during the third quarter 2007 compared to $2.2 million of sell-in revenue during the third quarter last year. We have reduced our quarterly inventory purchase commitment for the fourth quarter from our leading supplier by nearly one half in order to reduce our overall inventory position.”

“To increase orders and overall demand, we have developed specific marketing action plans to allow both the distributors and retailers to regain sales momentum and enjoy success with the moissanite category. Our ongoing initiatives show signs of increasing consumer awareness and interest for moissanite jewelry. Current marketing initiatives for the fourth quarter, such as the “Moissanite Milestone Moments” campaign launched in October with Oprah magazine and Oprah online, are primarily designed to increase consumer awareness which we believe can help drive product demand.”

Financial Outlook

As of today, the Company is updating its 2007 financial guidance as follows:


Revenue to be in a range of $30 million to $33 million.
Gross profit margins for 2007 to be in the range of 70% to 75%.
Marketing and sales expense to be in the range of approximately 49% to 53% of total net sales. The expectation for sales and marketing expense for fiscal 2007 has increased on a percentage basis due to lower sales expectations for 2007 as well as the Company’s efforts to support revenue initiatives at a higher level than last year.
Mr. Thomas concluded, “Despite our slower sales, we are optimistic regarding the growth opportunities associated with our business moving forward over the long term. We believe many of our most recent innovative marketing initiatives, such as our ‘Moissanite Milestone Moments’ campaign, our creative television broadcast ads, and other initiatives will continue to generate consumer awareness which will ultimately lead to healthy product demand.”

Moissanite is positioned correctly as a compelling product in an entirely unique jewelry category and Charles & Colvard has exclusive patented rights to this product for years to come. We believe that we offer a strong value proposition for retailers and consumers alike, enjoy a highly scalable operating structure, and require very little capital to grow. Further, we are taking the appropriate steps to reduce our inventory position, which is nonperishable. We believe we have a strong foundation in place to grow sales at the retail level and will proceed with our strategic initiatives with our shareholders foremost in mind.”

Charles & Colvard’s domestic sales in the third quarter decreased 51% to $5.3 million compared to the third quarter of 2006. Sales of moissanite jewels to the Company’s top four direct customers contributed $5.0 million in revenue in the third quarter of 2007 compared to $9.8 million in the prior year period. International sales for the third quarter decreased 5% to $1.2 million, with reduced sales to Hong Kong partially offset by strong results from India, Taiwan and Italy. Total shipments of 40,800 carats for the current third quarter period were less than the 77,300 carats shipped in the same period of 2006. Shipments of carats in the U.S. for the quarter decreased 51% while international shipments of carats decreased 9%.

At September 30, 2007 total inventory (including consignment) increased by $2.5 million compared to June 30, 2007 primarily due to the level of raw material purchases. The Company’s raw material inventories of silicon carbide crystals are purchased under exclusive supply agreements with a limited number of suppliers. Because the supply agreements restrict the sale of these crystals to only the Company, the suppliers negotiate minimum purchase commitments with the Company that may result in periodic levels of raw and in-process inventories that are higher than the Company might otherwise maintain.

Share and per share data for all periods presented reflect the effect of the one share for every four shares owned stock split, effected in the form of a 25% stock dividend, distributed on January 30, 2006.

Conference Call

The Company will hold a conference call with senior management to discuss the financial results at 4:45 p.m. EDT on October 23, 2007. Interested parties may participate in the call by dialing 913-312-6684. The conference call will also be broadcast live over the Internet. To listen to the live webcast of the event, please go to www.moissanite.com and click on the Investor Relations section where conference calls are posted. Please go to the website 15 minutes early to download and install any necessary audio software. A replay of the call will be available from October 23, 2007 through October 30, 2007. To access the telephone replay, participants should dial [phone]. The access code for the replay is 3463994.

About Charles & Colvard, Ltd.

Charles & Colvard, Ltd. (NASDAQ: CTHR - News), 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. Currently used in fine jewelry, Charles & Colvard created Moissanite™ is primarily marketed to the self-purchasing woman as the perfect reward or indulgence for a woman celebrating her achievements, whether personal or professional, big or small. For more information, please access www.moissanite.com or www.charlesandcolvard.com.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements expressing expectations regarding our future and projections relating to products, sales, revenues and earnings are typical of such statements and are made under the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about our plans, objectives, representations and contentions and are not historical facts and typically are identified by use of terms such as “may,” “will,” “should,” “could,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue” and similar words, although some forward-looking statements are expressed differently.

All forward-looking statements are subject to the risks and uncertainties inherent in predicting the future. You should be aware that although the forward-looking statements included herein represent management’s current judgment and expectations, our actual results may differ materially from those projected, stated or implied in these forward-looking statements as a result of many factors, including, but not limited to the Company’s ability to manage growth effectively, dependence on Cree, Inc. as the current supplier of the substantial majority of the raw material, ability to develop a material second source of supply, dependence on a limited number of jewelry manufacturing customers, dependence on continued growth and consumer acceptance of the Company’s products, in addition to the other risks and uncertainties described in more detail in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made. We undertake no obligation to update or revise such statements to reflect new circumstances or unanticipated events as they occur except as required by the federal securities laws, and you are urged to review and consider disclosures that we make in the reports that we file with the Securities and Exchange Commission that discuss other factors relevant to our business.


Charles & Colvard, Ltd.

Condensed Consolidated Statements of Operations

(Unaudited)



Three Months Ended September 30, Nine Months Ended September 30,
2007 2006 2007 2006

Net Sales $ 6,569,731 $ 12,101,651 $ 19,932,530 $ 28,631,754
Cost of goods sold 1,702,503 3,767,236 5,136,138 8,003,419
Gross profit 4,867,228 8,334,415 14,796,392 20,628,335

Operating Expenses:
Marketing and sales 3,100,638 3,764,133 9,236,054 9,879,600
General and administrative 1,196,207 1,057,972 3,485,117 3,193,068
Research and development 10,491 23,952 39,363 60,110
Total operating expenses 4,307,336 4,846,057 12,760,534 13,132,778

Operating income 559,892 3,488,358 2,035,858 7,495,557

Interest income 98,039 174,647 422,855 583,175

Income before income tax 657,931 3,663,005 2,458,713 8,078,732

Income tax expense 411,723 1,436,574 1,344,243 3,232,258

Net income $ 246,208 $ 2,226,431 $ 1,114,470 $ 4,846,474

Net income per share:
Basic $ 0.01 $ 0.12 $ 0.06 $ 0.27
Diluted $ 0.01 $ 0.12 $ 0.06 $ 0.26

Weighted-average common shares:
Basic 18,106,526 18,107,311 18,051,993 18,208,419
Diluted 18,288,384 18,611,794 18,294,190 18,736,423

Note

Share and per share data for all periods presented reflect the effect of the one share for every four shares owned stock split, effected in the form of a 25% stock dividend, distributed on January 30, 2006.


Charles & Colvard, Ltd.

Condensed Consolidated Balance Sheets

(Unaudited)


September 30, 2007 December 31, 2006
Assets
Current Assets
Cash and equivalents $ 6,313,243 $ 13,762,786
Accounts receivable 12,018,819 14,320,672
Interest receivable 7,061 16,381
Notes receivable 390,562 376,030
Inventory 16,434,000 20,677,215
Inventory on consignment 1,964,241 2,023,542
Prepaid expenses and other assets 468,430 783,989
Deferred income tax 737,469 583,322

Total current assets 38,333,825 52,543,937

Long Term Assets
Notes receivable - 23,970
Inventory 24,320,104 11,808,140
Furniture and equipment, net 649,515 651,134
Patent and license rights, net 348,621 288,171
Deferred income tax 885,963 686,621

Total long term assets 26,204,203 13,458,036

Total assets $ 64,538,028 $ 66,001,973

Liabilities & Shareholders' Equity
Current Liabilities
Accounts payable:
Cree, Inc. $ 1,632,545 $ 1,598,956
Other 1,141,786 2,870,752
Income taxes payable 184,642 413,387
Accrued payroll 264,335 322,383
Accrued co-op Advertising 946,048 1,275,041
Accrued expenses and other liabilities 193,119 244,539

Total current liabilities 4,362,475 6,725,058

Long Term Liabilities 913,311 -
Total liabilities 5,275,786 6,725,058

Commitments and contingencies

Shareholders' Equity 59,262,242 59,276,915

Total liabilities and shareholders equity $ 64,538,028 $ 66,001,973




Contact:
Charles & Colvard Ltd.
Jim Braun, 919-468-0399 Ext. 224
Chief Financial Officer
[e-mail]
or
Investor Relations
Integrated Corporate Relations
Bill Zima, 203-682-8200
[e-mail]

--------------------------------------------------------------------------------
Source: Charles & Colvard, Ltd.