NovaBay Pharmaceuticals (NBY) 8-K Independent Auditors’ Report

Exhibit 99.2

DERMAdoctor, LLC Unaudited Balance Sheets as of June 30, 2021 and 2020

	June 30, 2021			June 30, 2020
Assets
Cash and cash equivalents	$	143,307		$	424,396
Accounts receivable		378,448			631,833
Inventory, net		2,727,156			2,774,644
Prepaid expenses		22,429			36,811
Total current assets		3,271,340			3,867,684
Property and equipment, net		59,856			82,824
Intangibles, net		78,642			135,572
Total assets	$	3,409,838		$	4,086,080
Liabilities and Equity
Liabilities
Related party notes payable	$	1,645,000		$	1,690,000
Payroll protection program loan		286,700			315,800
Accounts payable		274,940			299,493
Related party accounts payable		45,000			45,000
Accrued expense and other current liabilities		368,241			887,272
Total current liabilities		2,619,881			3,237,565
Total liabilities		2,619,881			3,237,565
Equity
Redeemable membership interest		1,270,000			1,270,000
Members's deficiency		(480,043	)		(421,485	)
Total Equity		789,957			848,515
Total liabilities, redeemable membership interest and members' deficiency	$	3,409,838		$	4,086,080

DERMAdoctor, LLC Unaudited Income Statement for the Six Months Ended June 30, 2021 and 2020

	For the 6 months ended			For the 6 months ended
	June 30, 2021			June 30, 2020
Net sales	$	2,918,010		$	5,203,706
Cost of sales		1,108,224			2,451,717
Gross Profit		1,809,786			2,751,989
Operating expenses
Selling expenses		821,726			1,057,526
General and administrative expenses		714,102			631,190
Total Expenses		1,535,828			1,688,716
Income from operations		273,958			1,063,273
Other income (expense), net		313,588			(2,449	)
Interest Expense		(64,161	)		(70,924	)
Net income	$	523,385		$	989,900

DERMAdoctor, LLC Unaudited Statements of Cash Flows for the Six Months Ended June 30, 2021 and 2020

	For the 6 months ended			For the 6 months ended
	June 30, 2021			June 30, 2020
Cash flows from operating activities:
Net income	$	523,385		$	989,900
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation of property and equipment		10,663			11,779
Amortization of intangibles		21,604			23,977
Other income recognized on forgiveness of payroll protection program loan		(315,800	)		-
Changes in operating assets and liabilities:
Accounts receivable		(163,601	)		107,291
Inventory, net		155,262			(296,521	)
Prepaid expenses		(2,450	)		(3,555	)
Contract assets		-			145,079
Checks written in advance of deposits		(39,377	)		(271,110	)
Accounts payable		56,055			(74,063	)
Accrued expenses and other liabilites		(35,438	)		(113,211	)
Net cash provided by operating activities		210,303			519,566
Cash flows from investing activities:
Purchases of property and equipment		-			(11,484	)
Purchases of intangibles		-			(39,868	)
Net cash used in investing activities		-			(51,352	)
Cash flows from financing activities:
Net proceeds (repayment) on lines of credit		(324,477	)		(482,572	)
Repayments of related party notes payable		(45,000	)		-
Proceeds from payroll protection program loan		286,700			315,800
Net cash used in financing activities		(82,777	)		(166,772	)
Net increase in cash		127,526			419,509
Cash - Beginning of period		15,781			4,887
Cash - End of period	$	143,307		$	424,396
Supplemental disclosure of cash and non-cash investing and financing transactions
Cash paid for interest	$	64,161		$	70,924