Randy McCullough – President and Chief Executive Officer Kyle Macemore – Senior Vice President and Chief Financial Officer Steve Larkin – Chief Operating Officer Michelle Jones – President, Charles and Colvard Direct Sales Division, Lulu Avenue.

Alex Christensen - Craig-Hallum Capital Group Robert Jackson – Jackson Equity Fund. Jay Steinhilber – Morgan Stanley Neil Cataldi – Blueprint Capital Management.

Hello and welcome to Charles & Colvard Fourth Quarter 2014 Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded.

This conference may contain forward-looking statements as defined in Section 27A of Securities Act of 1933 as amended including statements regarding among other things, Company's business strategy and growth strategy. Expressions which identify forward-looking statements speak only as of the date the statement is made.

These forward-looking statements are based largely on our Company's expectations, and are subject to a number of risks and uncertainties, some of which cannot be predicted or quantified and are beyond our control.

Future developments and actual results could differ materially from those set forth in contemplated by or underlined in the forward-looking statements. In light of these risks and uncertainties there can be no assurance that the forward-looking information will prove to be accurate.

This webcast does not constitute an offer to purchase any securities, nor a solicitation of a proxy, consent, authorization or agent designation with respect to a meeting of Company's stockholders. I’d now like to turn the conference over to Randy McCullough. Mr. McCullough, please go ahead..

Thank you, operator. Good afternoon and thank you for taking the time to join us in recapping the fourth quarter and 2014 results and allowing us to update you on our most recent key initiatives.

We’d like to begin with Kyle Macemore, our CFO, going through our financials, then I’d like to take all of your time and attention as I provide some quantitative color on this past year and share our excitement about our 2015 initiatives.

Kyle?.

wholesale distribution, direct-to-consumer e-commerce business, which is Moissanite.com, and direct-to-consumer home party business, which is Lulu Avenue. We feel this reporting change will allow our investors to better gauge our progress and corporate decisions for our future growth.

The company’s direct-to-consumer e-commerce business, Moissanite.com, had net sales of $1.3 million in the fourth quarter of 2014, an increase of 24% compared to $1.1 million in the fourth quarter of 2013. During 2014, Moissanite.com had net sales of $3.4 million, an increase of 37% compared to $2.5 million in 2013.

The company’s direct-to-consumer home party business, Lulu Avenue, had net sales of approximately $562,000 in the fourth quarter of 2014, an increase of 135% compared to approximately $239,000 in the fourth quarter of 2013. During 2014, Lulu Avenue had net sales of $1.5 million, an increase of 252%, compared to $413,000 in 2013.

The company’s net sales of loose jewels decreased approximately 44% to $2.9 million in the fourth quarter and comprised 40% of sales this quarter compared with $5.2 million or 61% of sales in last year’s fourth quarter.

Finished jewelry net sales during the fourth quarter of 2014 were $4.3 million, an increase of 27% as compared to the same quarter in 2013. Gross margins for the fourth quarter of 2014 were 20% compared to gross margins for the fourth quarter of 2013 of 47%.

The decrease in gross margin percentage was primarily due to the sale of lower gross margins of slower moving inventory and more aggressive discounting in an effort to improve retail price points and broaden market adoption and a net increase in non capitalized manufacturing and production and control expenses, due to decreased inventory production.

Operating expenses remains consistent from fourth quarter of 2013 to fourth quarter of 2014, totaling $4.2 million in each quarter. The company recorded a net loss for the fourth quarter of 2014 of $2.8 million, or $0.14 per share, compared with net income of $105,000, or $0.01 per diluted share, in the fourth quarter of 2013.

The company ended fourth quarter of 2014 with $4 million of cash and cash equivalents on the balance sheet, compared to $2.6 million of cash and cash equivalents at the end of the fourth quarter of 2013. Inventory at the end of the fourth quarter of 2014 was $38.9 million, which was a decrease from $42.4 million at December 31, 2013.

Loose jewel inventory was $32 million and finished jewelry inventory was $6.9 million. The company has no long-term debt and does not utilize the $10 million credit facility it entered into with Wells Fargo at the end of June 2014. I’d now like to turn the call back over to Randy..

Thank you, Kyle. As I stated in the press release today, 2014 was a transitional year for our business in many respects while we were challenged by difficult economic conditions in some of our international markets. We began working on our made in the USA and our sustainable branding strategies.

We believe this approach will create a great foundation to build and grow both our domestic wholesale business and the end-consumers by providing superior quality U.S. based customer service and the trust of Charles & Colvard lifetime moissanite warranty.

These strategies along with several other things I’ll share reflects in our strong growth in our U.S. direct-to-consumer businesses. We also believe they will play an important role in Charles & Colvard’s maintaining existing and attracting new wholesale and consumer audiences.

We see this as a sign that new sales channel partners and consumers are both recognizing the value of our gems with such purity that it rivals any earthly gemstone for fire and brilliance know to many as The World’s Most Brilliant Gem, a unique created gemstone remains the ultimate and affordable jewelry.

2014 showed positive cash flows from operations compared with negative flows in 2013, and that’s good. We strengthened our balance sheet by selling existing inventory and improved our cash position. We expect inventory to continue as a source of cash flow in 2015.

Domestic sales improved in 2014 compared to 2013, this was due to the ongoing execution of our growth strategies, including working diligently with our wholesale customers and direct-to-consumer channels to move more moissanite jewelry in the marketplace with styles and include both Forever Brilliant and Classic Moissanite.

During this transitional year, we made the strategic decision to de-emphasize international markets, and instead we allocated our resources towards strengthening our domestic sales.

Our wholesale segment sales are trending for the first quarter of 2015 to be consistent with the first quarter of 2014, although much of that segment’s sales historically have been recorded towards the end of the quarter.

It’s been our experience that the majority of the consumers exposed to Charles & Colvard Moissanite Jewelry are inclined to respond positively. Consistently, we observe that the closer we get to the end-consumer, the greater our success seems to be.

As such moving through 2015, we intend to focus a lot of our energies on refining our more consumer oriented approaches, expanding with fresh modern collections coupled with creative mediate strategies that specifically showcased new innovations already seems to be paying off.

Taking this a step further, we will be working more closely with certain wholesale distribution partners and supporting those channels that have been the most meaningful sales. These include television, e-commerce, and the distributors that are supplying the vast population of independent jewelers.

Our wholesale and marketing teams are working together to ensure our messages are aligned in a way that is synergistic for our future growth and success. We believe this will result in more targeted brand architecture.

We’ve updated collateral, our launch in a new B2B website, marketing portal and have crafted engaging messaging designed specifically to assist our key customers and consumer acquisition. We believe this is a win for our wholesale partners and distributors.

Charles & Colvard and the end consumer who gains with finely designed jewelry featuring our moissanite gemstones. Historically, a large portion of our wholesale business has come through independent e-commerce site via our U.S. distributors. These independents have been created and valuable sales channel partners for Charles & Colvard.

In 2015, we planned to reach out and work directly with these existing independent e-commerce sites and other opportunities.

We aim to help them to generate more sales by offering them interact test to our loose stones and manage jewelry by at the same time leveraging sales support via our existing infrastructure and supporting those valuable relationships with our digital and marketing assets.

We have already began executing on this plan, beginning with those sales channel partners that have the largest sales volume of our stones and jewelry. We believe this joint consumer initiative will expand the opportunities we have to provide greater awareness while also increasing overall Charles & Colvard Moissanite sales.

To reinforce and support our sales channels and position Charles & Colvard as premier source of moissanite, our marketing team has been working on several social media initiatives at target current and future moissanite consumers and supports Charles & Colvard along with our Classic Moissanite and Forever Brilliant brands.

Our gems have been featured as unique, sustainable, exquisite engagement and luxury option to 100s of 1000s of followers of various sites online media, blogs, and consumer information sites. Several fabulous jewelry designers are using our gemstones and selling them on their online stores and the SCE e-commerce site.

This has given us a whole new angle for fashion editors looking for what’s trending. Our campaigns are focused on drive a consistent message, emphasizing that we are based in the USA, the FCO origins of our stone, the ever lasting beauty of our gems and the overall value.

We’re also various forms of digital and social media outreach to accomplish greater awareness of the value proposition we offer. Now to plant the foundation to reach the millennial generation, the future of very consumer business, we’ve trademark Moissy. The nick name was stored by our younger gift generation of consumers, primarily on wedding blogs.

We’ll be using this as the basis of our social platform with consumer contact site called Moissy.com. We believe Moissy.com will create a community and aggregate everything social from Instagram, Twitter, and Facebook with content generated from consumers as well as designers who are all packed in without this gemstone.

With content sharing of testimonials and features, we believe a groundswell of awareness we’ll develop in a way that is relevant to today’s innovative driven consumer. Now, we’re just beginning building this site and we’ll target to launch Moissy.com. this summer.

Focusing on the segments of the jewelry industry, primarily independent jewelers that have embraced moissanite, we plan to continue to leverage our distributors’ relationships. Our team has partnered with our distributors, marketing to the independent jeweler with a series of scaled outreaches through jewelry industry magazines and websites.

Our goal is to create awareness while we keep supplying more and more independent jewelers with the information and tools they need to benefit from the distinct incremental margin solution that comes from using our stones in jewelry, both our direct to consumer and direct to end retailer campaigns and form and provide ways that our partners can leverage their current investment in diamond designer semi-mount rings with Forever Brilliant center stones in order close more sales more often, particularly for those sales where price point is an issue.

We’re just beginning to realize the long anticipated benefits from the investments we have made in our direct-to-consumer businesses, Lulu Avenue and Moissanite.com. We are very encouraged about the significant increases in those segments, albeit from a small base, in sales in 2014 over 2013.

Although the first two months of 2015 are no guarantee of future success, we continue to see both of these segments post strong sales increases through the first two months of 2015, compared to the first two months of 2014. Steve Larkin and Michelle Jones will provide an update on Moissanite.com and Lulu Avenue later in this call.

In the fourth quarter, we signed a new exclusive long-term supply agreement with Cree for the purchase of silicon carbide crystals. These are the crystals from which we produce our moissanite gems. Our operational capabilities increased and improved in the middle of 2014 with the opening of our new state-of-the-art facility.

We believe the foundation is now established, including our most valued partnerships, for the successful growth of a more direct to consumer business approach in 2015 and beyond.

Let me take this opportunity to have Steve Larkin, our COO, provide further insight on our rapidly growing direct-to-consumer e-commerce channel Moissanite.com and Michelle Jones, the President of Lulu Avenue, update you on the exciting progress with Lulu Avenue, our direct sales and social selling business.

Steve?.

Thanks, Randy. Moissanite.com’s fourth quarter 2014, 24% net sales increase over the fourth quarter from 2013, reflects increases in conversion rate, number of transactions and average order value while strategically spending marketing dollars on more productive web marketing channels and segments.

Gross profit margins in the fourth quarter of 2014 looking similar to the fourth quarter of 2013, the higher net sales, unless marketing expanding, allowing us to improve the quarter’s cash contribution.

The 37% increase in annual net sales compared to 2013 also included increases in conversation rates, number of transactions, and average order value along with disciplined spending in marketing and direct overhead, improving the overall bottom line significantly.

Accomplishments for 2014 included an expansion of SKUs, styles and price points, e-mail and customer acquisition growth, mobile traffic transaction and revenue growth, expanded methods of payments, enhancements to site search and navigation, search optimization and increased size and interaction with social media fans and followers.

The Moissanite.com channel enables us to minimize investment by leveraging our existing inventory, helping to reduce inventory obsolescence and increasing cash flows. We’re excited about 2015.

We planned to continue with innovating improvements to look and the feel of our site, driving net sales and gross margin dollars, while managing expenses tightly. Our goal is to increase awareness, brand loyalty and consumer satisfaction, while enabling our visitors to experience The World’s Most Brilliant Gem.

I’ll now turn the call over to Michelle for her comments on our direct sales and social selling business, Lulu Avenue.

Michelle?.

Thanks Steve. I’m really excited to talk with you for the first time about the progress Lulu Avenue has made in the 22 months I’ve been with Charles & Colvard. After an initial integration phase we launched the Fall 2013 collection for Lulu Avenue in the second half of 2013.

We began to see Lulu Avenue gain traction in 2014 closing the year with net sales of $1.5 million, which was an increase of 252% versus 2013. We now have a presence in 46 states with our strongest concentration being in New Jersey, Wisconsin, Illinois, North Carolina, Arizona and California. I’m excited about the progress of Lulu Avenue.

Much of last year was spend refining our processes and marketing asset to ensure that our style advisers are supported with in-depth training, a designer braded jewelry line including fine moissanite pieces and the very latest technologies available in the direct selling industry.

Our home office team is dedicated to supporting each style adviser with outstanding customer service and high-quality products to allow for strong style adviser and customer relationships. A big part of the style adviser experience involves the support system that we offer.

We have spent a significant amount of time designing our back office system to be best-in-class. The Lulu Avenue office suite provides style advisers with robust tools to engage customers’ on-board new team members and access to marketing and training supports.

The closing of lia sophia in the fourth quarter of 2014, a former direct seller of fashion jewelry presented an opportunity for Lulu Avenue to onboard talented and experienced style advisers.

We believe we attracted the very best of the best and in December of 2014 we almost tripled our active number of selling style advisers, compared to November 2014.

We were very cautious in our on-boarding as we needed to protect our inventory for our existing family of style advisers and the founding leaders that build the foundation of what Lulu Avenue is today. Working closely with my National Sales Director, we developed relationships with some of the most successful leaders at lia sophia.

These ladies were excited to work with Lulu Avenue and ensure a home for the seasoned team of style advisers and an opportunity to earn money, necessary to contribute to their family’s well being. We are seeing an increase in the number of shows house per active selling style adviser resulting in increased overall sales.

Our goals now are to continue to assess our product offerings and programs to ensure we stay relevant and competitive within the jewelry direct sales arena. We believe our competitive edge is and will continue to be the exclusive Moissanite designs we offer to our style advisers.

With only direct sales company selling Moissanite and I’m excited to share that approximately 32% of Lulu Avenue’s net commissionable sales in 2014 was Moissanite with our average sales being approximately $300.

Moissanite is a major selling feature for our style advisers as they look to attract new team members and offer a far superior earning opportunity. Every starter kit that we sell to support launching a style advisers business is pretty much enticed with a beautifully branded love knock Moissanite pendant.

All of our style advisers are required to take a Moissanite task, which when they pass allows them to earn the title of qualified Moissanite specialist earning them a certificate of display at the shows and an opportunity to purchase Moissanite for that display at a very special price.

With the talented team we have assembled internally and the amazing group of man and woman I am honored to work with daily to brand Lulu Avenue across the USA, I am beyond optimistic about our future and what we can accomplish in the next few years. I will now turn call back over to your Randy. .

Thank you, Michelle. I am sure you can tell from Steve and Michelle enthusiasm and mine that we are very excited about our direct consumer and new social commerce initiatives. We are committed to continue with more initiatives in 2015 they keep moving all of our businesses closer to the consumers who are embracing our strategic values.

Emphasizing that we are based in the USA the ethical origins of our stone, the ever lasting exceptional Forever Brilliant and every Moissanite gem with the market price is still a fraction of a comparable diamond. All of these providing an astounding value proposition.

Additionally Charles & Colvard will provide support this year for all of our businesses with ongoing innovation and research, receipted consumer outreach, fresh and targeted marketing and branding efforts, leveraging social media and inventive channel marketing.

All focused on expanding awareness of bringing about change with forward thinking insights for 2015. This concludes our formal remarks this afternoon and now we‘d like to open the call up to answer a few questions that participants on call who may have. Operator, could you please open the floor for the Q&A session..

Yes, sir. Thank you. We will now begin the question-and-answer session. [Operator Instructions] And the first question comes from Alex Christensen with Craig-Hallum Capital Group..

Hey everyone. I am in for Alex Furhman today. Congrats to you guys I saw you were in Glamour Magazine a couple of months ago. So it looks like your engagement strategies are starting to work. I just had a couple of quick questions for you.

I know in 2014 you guys were kind of focusing more on the domestic market, are you guys looking at getting back into the international market with more vigor this year? And then secondly, I was wondering about distribution channels, what you are looking at in terms of TV and if you will be expanding those here in the next few months are first half of the year?.

Okay, thanks Alex. First on the international front, while we are not investing resources to go out and speak, incremental – international sales, we are seeing some of international sales that pulled back price and orders coming back this quarter.

So you know, we are not walking away from the international market, I do think they’ll be in the international play and Tom that has our wholesale – sales has been in contact with several of our key distributors over there.

So I do think there will be an international market, I don’t think it will be as robust as it was at one point, but I could be happily surprised and on the TV front, we’ve seen increases in our television sales, year-over-year and based on our conversations and discussions with specifically JTV Jewelry Television, we have no reason to believe that we won’t see the same trend going forward this year..

Great and then I just have one follow-up on the JTV.

I’m just wondering what your coverage is looking like are you pretty flat in terms of Amazon on the network or are you planning on expanding that?.

Alex, I think to show to in the fourth quarter hours were up from the fourth quarter of 2013 and looks like in the first quarter hours are pretty flat in 2015 compared to 2014. So we plan quarter-by-quarter and year-by-year, as Randy said, we work very closely with JTV. Our business last year within and volume increased from 2013 in revenue..

Great, well and that’s all from me. Thank you guys, very much. .

Thanks Alex. .

Thank you, Alex. .

Thank you. And the next question comes from Robert Jackson with Jackson Equity Fund. .

Yes, Good afternoon. .

Good afternoon.

I have a question on the balance sheet. You guys did a good job, moving some of that long-term inventory. But it’s still quite higher almost $40 million.

Can I just ask because I’ve been listening for conference calls for years and we really talk about this long-term inventory and I know if you good and that’s great? But hypothetically if you have to liquidate that inventory in the market and amounts let say.

Would you be able to do at that value or would it be less, would it be more, I just want to get an idea for what the real market value is – in that scenario?.

Hey Robert, this is Kyle. We have been very clear and consistent, I believe that the inventory we can’t [indiscernible] [0:02:55] cost using GAAP, we believe its properly accounted for work and we believe there is a market for it.

I mean we can’t really deal with hypothetical, so say we have to liquidate in a month, because that’s not the way we are running the business..

Well I understand that that the reason is the hypothetical is important though, is that if you could get that full value today, what would be the downside in taken down 10%, 15%, 20% of it still saving a lot for all the growth areas.

But I mean I am looking at the your release from on the 12.31, 2012, your majority was $32 million so - its lower than last year, but it still at $39 million and its just we talk about this every year and I just don’t understand, if it’s that liquid, and its that sale of book is a lot of that is blue stones why not several little why not build up the cash in the balance sheet.

So we can do all this growth opportunities, and said in only $4 million, use to be a ton of cash in the balance sheet what would be the downside and getting four market value for some of that long-term inventory its been there forever?.

It means we’re all actively trying to sell as much product as we can’t the next stones we can’t as much as too or as we can and we’re going to do - we’re going to do it in a way that we think to make long-term business sense.

As you probably note [indiscernible] far against our inventory increased in part, because we made an investment in Forever Brilliant. Our inventory was coming down and we made investments of about $10 million Forever Brilliant.

Our inventory peak just under $44 million is now below $39 million and we expect to continue to come down at 2015 and be a source of cash flow so, you know….

I understand and I appreciate Forever Brilliant I treat separately, I am talking about the long-terms stuff that isn’t Forever Brilliant.

I just don’t understand these are liquid assets, these are lot of more loose stones, I just don’t understand what would be wrong with selling a portion, just a portion and getting – making the balance sheet stronger and being able to finance some of these other opportunities..

Well, I guess we can take it offline if you like to give us a call. But I think we’ve articulate our sales on the inventory and how we’re running the business. We have one credit, we haven’t used it, we are building up for cash, it is part of our strategy, we are trying to moving inventory in place that make sense that prices that make sense..

And I understand that and I will leave that alone I guess, it just needs to be set I think what’s hard is that every time its seems like the results are not what everyone hopes and then we spend a lot of time talking about the new initiatives. The new initiatives even with the growth last year are less than 20% of the sales of the whole company.

So they were offer very, very small base and it’s just hard not to look at the larger part of the business..

We don’t disagree..

Okay..

Thank you. [Operator Instructions] and our next question comes from Jay Steinhilber with Morgan Stanley..

How you doing guys. It’s been a long-term shareholder here and it’s been difficult over the last several years.

But, I know we’ve spent lots of money in the last couple of years, trying to boost the top line and revenue number here and from my recollection, when you guys came - Randy when you came in, we started turning the corner, we are generating profits.

And we haven’t seen any profits for a while, when are we going to get back to actually generating profits for this company, I know, our cash flow positive last year, but we’re going to get the stock price up, it goes hand-in-hand with the profits. So that’s my first question, and I got another question or two after that..

Well, it’s always my goal and Jay, I can assure you, that we are focused on generating our profit this year. Obviously, we got approve - prove ourselves and we will stay focused on that. But having said, we do think our investments, especially in Lulu Avenue and that’s where the majority of our investments are at.

Are the right long-term investments for our investors and that obviously creates some obstacle to be unprofitable year-over-year..

Are those investments going to stabilize or they increasing, its seems like if the revenue goes up, we should eventually get there but, are we spending too much, I guess and, I want the growth, I want the revenue numbers up and we got to spend.

But I just look at couple of years ago, we were from my recollections, we’re making, starting to make decent money..

I think, Jay, you and I have had this conversion..

I really do feel we’ve hit that inflection point with Lulu Avenue. We definitely headed with the e-commerce. Our e-commerce is EBITDA profitable, and should be –should pertain that it’s not increased for this year.

But Lulu Avenue at 50 inflection point and I’m very hopeful, that we will see reduction in the ratio of our investment - our cash investment year-over-year..

Can you give us some insight on the Lulu advisers, so I know the other shop closed down, you’re able to grab some advisers and so forth? Where were you add a 930 September 30 versus today?.

Yes, we don’t actually disclose the little number of Lulu style advisers. But as we did mentioned that we did triple the number of selling style advisers, they free from that time period you’re gaining September into December. So it did have an infusion into the number of style advisers. But, we are not disclosing the number to share.

We are trying to give you guys a lot more information on the various segments of the business. Because that was one of their feedbacks we’ve got from investors. But we’re just not ready to disclose the number of style advisers, at this point..

That’s fine.

So just to be clear, you have three times as many style advisers now that are contributing than you did on 9/30 is that correct?.

We have three times the number of selling style advisers, those are style advisers that have sold – had created a sale within that month..

From 9/30 to 12/31?.

Yes..

Okay. Last question, about a year ago, Amazon was all the rage as it just seems like it [indiscernible].

What the heck is going on over there? And is anything going on? And should we have even put out anything as far as the Amazon goes it got everybody’s hopes up and deflated them in another month?.

Yes, Amazon has not met our expectations. We’re not giving up on it. I still think Amazon is a big channel and a big player in that e-commerce marketplace. And we are posting – I am sorry, we are posting more products on there, Jay, so we’re still hopeful that we’ll see an increase..

What are the problems on hand that we can’t get they’re moving, there’s got to be as it technology problem, what – I don’t understand?.

At this point – and then I’m not an expert in that field, but Amazon has so much product on their side understandably, so they’re one of the biggest in the world that even though you have product on there and I’m – how many SKUs that we have on there now that you have posted.

We’re at about a 100 SKUs now, but they have to sell and build up whatever they referred to it as, the more you sell, the higher you go up in the standing. So when someone searches in order to see a piece of our Moissanite and diamond alternative is something like that. We just know we haven’t earned our way up to the top yet, but we’re working on it.

We’re the selling a few pieces every week. So it’s starting to build and we are going to be posting more pieces on there..

Thank you. And the next question comes from the Neil Cataldi with Blueprint Capital Management..

Hi, guys. Thanks for taking the question. I apology on the transparency with Lulu it’s been a long time, some of us have been asking for it. So it is nice to see some numbers finally. A couple of my questions were already asked. So I’ll turn another one at you.

On the big box side, can you provide some color on how things are going with Kohls and Target? And is there any moments with either of them or maybe somebody else to maybe crack brick and mortar?.

Well, Kohls had a great for us. We felt Kohls’ fourth quarter was actually really good. Target was not as strong as Kohls but – understand well Kohls got a year ahead start on and we have had discussions but we’re not inside their store as of yet and it just remains to be seen..

Okay. Are these – the Kohls relationship has been I think over a year now, are you – what’s happening on the marketing side of it. I always viewed the challenge with the consumer to be that in education is sort of required on the product. Its great just people don’t know about it.

So is there any work or anything happening behind the scenes with Kohls and Target as far as they’re maybe throwing some – some marketing initiatives your way to drive people to the side? Or is it listings just up there and it’s up to people to find it..

Neil, hi. This is Steve Larkin. We supply them with marketing materials and collaterals digitally, everything from product descriptions, we offer photography, we offer educational information.

How it gets utilized and based upon each company’s policies in terms of using third party digital assets or their interpretation as such is up to this specific retailer. So in some cases, we’re more successful than we are in others, but we do make that available and obviously we want them to be telling the story..

Okay. And then Survivor Collection launched in the fall and that did crack some brick and mortar.

Can you provide a little color on the traction there or a sell through anything notable to point out?.

Yes, the sell-through in Boscov, which is about a little less than 50 department stores, has been really good and we actually are in conversation with them to put an assortment with Moissanite in some of the stores that hopefully we will have that culminated early summer.

And in the Rogers & Holland stores, they’re actually featuring the Survivor Collection in their Mother’s Day catalogue. So both of them have had really good response to it..

Okay.

Is there interest from other name brand, department type stores to maybe look at Survivor as opposed to the other lines?.

We are in discussion with several; I just can’t name them right now, but….

Okay..

But yes, we are out there just doing it for sure..

All right, great, thanks guys. I will be in touch..

All right, thank you Neil..

Thank you. And the next question comes from [Indiscernible] private investor..

Good morning or good afternoon. A couple of questions.

First, is there any significant to the wording or the description of the company instead of sole source of Moissanite, now it’s original and leading source in any strategic things or competition things behind that?.

Yes, we do plan on pressing harder that we are the original sourcing. Well, you’ll also see us playing out more than they were USA based company. We think that gives us strategic advantage because if generics do come into market, both pad and exploration [ph], it will be coming from foreign companies.

And if we just – we have done a lot of research on it and that both of those play very strong for us..

And what are you seeing as a status of generic moissanite or other brand to moissanite? Any change from what you’ve said in the past?.

No anything I’ve seen and we constantly watch the market and batched on say if we see them in a marketplace, but I haven’t seen anything that that will compare like Cree has able to provide us with..

Okay. And a little bit of a big picture question. I mean sometime ago and maybe a decade now, it’s been the sales were about $45 million of every jewels and now we’re looking at tens of millions, there has been the level but the new businesses that direct to consumer, the party business, they are the single million level now.

And I just wonder with the transition and such are we still targeting the kind of levels that we were talking before 100s of millions in revenue or is there some other kind of level that we should be thinking about?.

Well, let me just give you a little bit of color. We estimate through February of this year that Lulu Avenue has recorded more net sales than it did in the entire fourth quarter of 2014. We also estimate that Moissanite.com through February of 2015 recorded more net sales than it did in all of the first quarter of 2014.

So these businesses are growing at a very rapid rate and we feel that they will be a much more significant portion of our sales for 2015, that’s not same that our wholesale business is not going to be growing also.

We are focused on several areas that we think are going to be accretive to our wholesale business and how that all culminates for the year remains to be same.

But I do think that our decision several years ago to get into the consumer direct business is really reached the level now that where it’s going to start paying off and we’ll see – we’ll reach the benefit of our initial investments.

How long does it take to get to $50 million, $75 million or $100 million, I want to get there as much as you do and we’re going to keep pursuing every avenue possible to push our sales revenue in that direction..

Is it fair to say that – it seems like a lot of the resources have been put into the direct-to-consumer businesses and maybe there is not as much push that’s been happening in the wholesale business in recent years? Is that going to continue? Or is that part of the transition to decrease the level of the wholesale business in terms of resources and focus on the direct-to-consumer?.

No, we have not decreased any of our investments in wholesale. If anything our investments are up in our wholesale business, we just ran into some – I mean to be quite honest we ran into some rough orders in the international marketplace. In 2014, I think we’re going to see that turn in somewhat..

I do think Dennis through – I mean I agree completely with what Randy said, but we are part of the benefit of being direct-to-consumer is it allows us to get closer to that end consumer and control that messaging from a marketing standpoint, get that real-time feedback.

And so that is part of the strategy is being able to have that access to the end consumer. So we’re trying a multi-faceted approach, but there is a component to it of getting closer to the consumer..

Well, I mean that part is [indiscernible] getting to the consumer; it’s a little different thing to see that party has been to see that a local jewelry store that kind of different ball games and different audiences are they? Or you see some of them crossover there?.

The audience that we see purchasing through jewelry television who sell close to $15 million at their selling price of moissanite jewels this past year is very similar to the audience that we have buying from our moissanite.com and the – what we see come into our Lulu Avenue parties.

I think there is a very definitive consumer to our moissanite especially the new Forever Brilliant. I think, the real opportunity and that’s where Sarah and her marketing team are really focused is this millennial generation who have – I mean, if you – you’ll see they have really embraced moissanite.

And I think that’s a huge opportunity that we’re just now touching the tip of the iceberg..

Well, I understand the potential of something like Lulu Avenue. And openly that growth curve continues when the numbers get bigger, bigger. Thanks..

Thank you..

Thank you..

Thank you. And there are no more questions at the present time. I would like to turn the call back over to Mr. McCullough for any closing comments..

Thank you, operator. Once again I’d like to thank everyone for taking the time to participate in our call today. And most of all thank our employees for all their hard work and continued dedication. Operator, that’s the end of our call..

Thank you The conference call will be archived for review on the Internet at https://www.webcaster4.com/Webcast/Page/346/7414 and on the Company’s website at http://www.charlesandcolvard.com/investor-relations/events until Friday, March 27, 2015. The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect..