Moissanite feels pinch as sales fall $3m in Q2

moissanite-suite-web.jpg

Loose gem sales fall 9% while finished jewellery sales drop 15%.

Moissanite producer Charles & Colvard has released its sales and profits for Q2 2011, which show the business is down for the second quarter.

Net sales for the three months ended June 30 decreased 10% to approximately $3.0 million (£1.8 million), compared with approximately $3.3 million (£2 million) in net sales during the corresponding period of the previous year.

Loose moissanite gemstone sales decreased 9% to approximately $2.5 million (£1.5 million), compared with approximately $2.7 million in the corresponding period of the previous year.

Story continues below
Advertisement

Charles & Colvard have attributed this decrease to a one-time $889,000 (£546,000) sale to an international customer in the second quarter of 2010 that did not recur in the second quarter of 2011.

Finished jewellery sales decreased 15% to approximately $521,000 (£320,000) compared with approximately $610,000 in the corresponding period of the previous year.

However, the company has expressed that, aside from the effect of two significant non-recurring sales transactions in prior-year period, second quarter sales increased 42% across its customer base.

Net sales for H1 decreased 3% to $6 million (£3.7 million), while loose moissanite gemstones sales decreased 7% to $5 million (£3 million) in H1.

The company recorded a net loss of $103,000 (£63,270) in the second quarter of 2011, compared with net income of $336,000 (£206,400) in the second quarter of 2010. For the six months ended June 30, Charles & Colvard felt a net loss of $340,000 (£208,800) compared with net income of $635,000, in the corresponding period of the previous year.

Charles & Colvard said these net losses were primarily a result of lower sales, higher manufacturing overhead and operating expenses involving new business initiatives to support future revenue streams.

Randy N. McCullough, CEO of Charles & Colvard said: "While our total net sales during the most recent quarter decreased from the prior-year period, significant non-recurring sales transactions to two customers benefiting revenue during the second quarter of 2010 accounted for the decrease."

"By contrast, our revenue in the second quarter of 2011 consisted of sales across an expanding customer base, which includes new customers such as televised home shopping network retailers that were added in the latter part of 2010 and during the first half of 2011.

"The outlook for the second half of 2011 appears encouraging and should benefit further from our planned launch of new sales and marketing initiatives," McCullough added.

"On a longer-term basis, we remain confident in our belief that moissanite is destined to significantly expand its share of the $120 billion global jewellery market and that our multi-channel sales and marketing strategies will play a key role in the accomplishment of our growth objectives,” he concluded.

Authors

*

Related posts

Top