Michele Greco
Chief Financial Officer and Chief Administrative Officer at Veru
We recognized a gain on the sale of Ententeff assets of $695,000 compared to a gain of $918,000 in the prior quarter, which is based on non refundable consideration received related to promissory notes due to VERU. In conjunction with the sale of the FC2 female condom business, we recorded a gain on extinguishment of debt of $8,600,000 related to the termination of the residual royalty agreement. This represents the difference between the change of control payment of $4,200,000 and the net carrying amount of the extinguish debt of $12,800,000 which included an embedded derivative for the change of control provision at fair value of $4,700,000 The bottom line result for continuing operations was a net loss of $1,800,000 or $0.01 per diluted common share compared to a net loss of $7,700,000 or $0.08 per diluted common share in the prior year's quarter. Net loss from discontinued operations net of taxes related to the FC2 business was $7,100,000 or $0.05 per diluted common share, including the $4,200,000 loss on the sale of the FC2 business compared to a net loss of $609,000 or $0.01 per diluted common share in the prior quarter. The increase in the net loss from discontinued operations of $6,500,000 is due to the loss on the sale of the FC2 female condom business and the increase in the loss from the change in fair value of derivative liabilities of $3,100,000 partially offset by an increase in gross profit of $400,000 and a decrease in selling, general and administrative expenses of $500,000 Now looking at the balance sheet.