CHARLES & COLVARD PROVIDES BUSINESS UPDATE RELATED TO COVID-19

RESEARCH TRIANGLE PARK, N.C., April 09, 2020 (GLOBE NEWSWIRE) -- Charles & Colvard, Ltd. (Nasdaq: CTHR), the original and leading worldwide source of created moissanite, provided an update on actions being implemented in response to the COVID-19 pandemic. 

“During this evolving environment, we have acted quickly to focus on three key areas,” commented Suzanne Miglucci, President and CEO of Charles & Colvard. “These include safeguarding the health and safety of our employees; streamlining operations while ensuring support of our brand and customers; and maintaining our financial strength and stability.”

“We have had to make some tough decisions, including furloughing a large portion of our workforce. We are committed to emerging from this crisis as a strong, growth-oriented company and will make every effort to bring our team members back to their jobs as quickly as possible. Despite these short-term disruptions, we believe the underlying trends that will drive our business over the long-term remain intact, including our e-commerce oriented Millennial and Gen Z customer base and the large and expanding global market for lab-created gemstones and ethically-sourced jewelry,” said Ms. Miglucci.

The Company is implementing a number of measures to help mitigate the operating and financial impact related to the pandemic, including:

• Deploying a work from home policy for all but essential employees due to a mandated stay-at-home order by the state of North Carolina;
• Continuing to process online orders on the Company’s e-commerce website during the closure period, with limited shipping and fulfillment capabilities until state and municipal stay at home orders permit full operations to resume;
• Working with third party partners to enable alternate distribution options, though there may be limited ability to deploy these contingency plans due to global stay-at-home restrictions;
• Furloughing approximately 50% of employees, starting April 13, 2020, and funding all health insurance premiums during the furlough for all eligible employees impacted by these measures;
• Implementing temporary salary reductions for all employees, including 25% for the Chief Executive Officer and 15% for the Chief Financial Officer and Chief Operating Officer;
• Instituting a 50% reduction in Board Director fees;
• Reducing non-payroll expenses, including product development, digital marketing, and travel;
• Working with advisors to maximize participation in all eligible government or other initiatives available to businesses or employees impacted by the COVID-19 pandemic such as extending Families First Coronavirus Response Act (FFCRA) benefits to impacted employees, and applying for government-subsidized business loans. The Company also extended new 401(k) benefits to assist employees with additional distributions and loan terms during this challenging time.

“As we continue to navigate the rapidly-changing business and regulatory environment, we are committed to assisting our impacted employees with benefits that will help them remain safe and solvent, to maintaining the high level of service our customers have come to expect of Charles & Colvard, and to communicating with all of our stakeholders to provide periodic updates on our progress. Please refer to the  COVID-19 status on the charlesandcolvard.com website for updates as they become available,” concluded Ms. Miglucci.