MARINE PRODUCE AUSTRALIA LIMITED ABN 70 …

1 MARINE PRODUCE AUSTRALIA LIMITED ABN 70 091 805 480 ANNUAL REPORT For the Year Ended 30 June 2017 MARINE PRODUCE AUSTRALIA LIMITED po box 1008 west perth wa 6872 34 bagot road subiaco wa 6008 telephone +61 8 9381 4483 fax +61 8 9381 5817 email web abn 70 091 805 480 MARINE PRODUCE AUSTRALIA LIMITED | 2017 Annual Report Page 1 CONTENTS Page CHAIRMAN S ADDRESS ..2 MANAGING DIRECTOR S REVIEW ..3 BOARD OF DIRECTORS AND COMPANY SECRETARY ..5 DIRECTORS REPORT ..6 AUDITOR S INDEPENDENCE DECLARATION ..10 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE CONSOLIDATED STATEMENT OF FINANCIAL POSITION.

2 12 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ..13 CONSOLIDATED STATEMENT OF CASH FLOWS ..14 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ..15 DIRECTORS DECLARATION ..46 AUDITOR S INDEPENDENT REVIEW REPORT ..47 SHAREHOLDERS INFORMATION ..49 CORPORATE DIRECTORY ..50 MARINE PRODUCE AUSTRALIA LIMITED | 2017 Annual Report Page 2 CHAIRMAN S ADDRESS Dear Valued Shareholders, On behalf of the Board of Directors, it gives me great pleasure to report a third consecutive year of strong positive financial performance. It has been a year of further progress for us and we have seen significant growth in both revenue and profit.

3 Our sales revenue increased by almost 70% to $ million, and at $5 million our NPAT has increased by over 40% on last year. The earnings per share this year was $ and our net tangible asset backing per share is sitting at $ Since MPA first trialled sea cage farming more than 12 years ago, we have built this into the only ocean cage barramundi farm in AUSTRALIA . Our Cone Bay brand is known across AUSTRALIA as being synonymous with premium ocean-grown fish, and we are now taking that fish to the world. With licencing now in-hand that allows the production of 15,000 tonnes finfish per annum, we are poised to become the biggest barramundi producer in the country.

4 Currently stocking over 3,000 tonnes of fish in the pristine waters of the Kimberley, we received our BAP sustainability certification this past year and remain one of the most sustainable food production systems in AUSTRALIA . As I reflect on the history of MPA, I am proud of the successes that we have achieved thus far, but also in how we have achieved them - staying true to our goal of being a premium quality seafood producer while creating long term value for our shareholders and maintaining our social responsibility to the environment and community.

5 This year has seen significant advances operationally. The farm now holds 35 stocked ocean cages and we have made our first step toward automation with the addition of our purpose-built feed barge. Going forward, we must continue to innovate and grow, and to that end we have recently added our first 120m cages in the deeper waters of our lease area. The Board believes that by building sustainable long term revenue and earnings growth and using a disciplined approach to capital expenditure funding, we can take advantage of the expanded production licence to drive returns and create long term value for our shareholders.

6 We thank you, our shareholders, for your continued interest and support, and together we look forward to a year of sales growth and further farm development. Yours faithfully, Miles Kennedy Chairman MARINE PRODUCE AUSTRALIA LIMITED | 2017 Annual Report Page 3 MANAGING DIRECTOR S REVIEW Dear Shareholders, On behalf of the Board and Management, I am pleased to report another successful year for MPA, with sales revenue of over $12m and a record profit of near $5m. Upon receiving our 7,000t per annum production permit in late 2014 and subsequent 15,000t per annum permit in 2016, we put the focus and resources into expanding our on-farm biomass so as to build and sustain an ever increasing harvest of premium sized ocean Barramundi.

7 In that time, we have increased our on-farm fish biomass from ~800 tonnes to ~3,000 tonnes, and this year harvested over 1,000t of our premium Cone Bay Ocean Barramundi, with a view to doubling that volume in FY18. The strong progress of the farm and business has enabled us to attract exceptional staff, and this year we were very pleased to welcome Hank Poeschl as General Manger, Helen Chow as Chief Financial Officer, and most recently Demetri Demosthenous as our new Sales and Marketing Manager. Hank brings over 30 years sea cage farming knowledge to our group and is providing a wealth of experience and direction.

8 Helen came to MPA with more than 20 years as senior accountant and CFO and has applied her skills and proficiency with signifianct impact. Demetri joined us in March 2017 as we transitioned to in-house management of our sales and marketing. He has over 25 years in seafood sales and has brought an unwavering focus and energy to our domestic and export markets. The addition of the three members to our outstanding existing farm and Perth staff has MPA fielding an exceptional team of people. We have succesfully secured additional bank debt funding from NAB for our working capital and capital expenditure requirements for medium term growth.

9 We greatly appreciate the support NAB has given us over the past 3 years. With the approval to significantly increase our production tonnage now secured, we also have the opportunity to work toward the longer term goal of scaling up production to the currently permitted 15,000 tonnes per annum, and to look at areas beyond our current farming location for future expansion. In line with our expansion plans over the past few years, we have invested heavily in farm equipment to support the increasing fish biomass. Our farm now has 35 stocked cages anchored over 3 systems, and just recently we added our first two 120m circumference cages which are now ready for stocking.

10 This year we also installed our first purpose-built automated feed barge which, at capacity, can be used to feed 20 cages per day, providing a significant improvement in feeding efficiency at the farm. $ $ $ $ ($ ) $ $ $ FY14FY15FY16FY17 Revenue & Profit Revenue ($'m)Net profit after tax ($'m) MARINE PRODUCE AUSTRALIA LIMITED | 2017 Annual Report Page 4 MANAGING DIRECTOR S REVIEW (CONT'D) Significant expenditure was also made on improved cage cleaning equipment which has enhanced both the efficiency and effectiveness of our cage cleaning process. We continue to strive for improvements across the farm by investing in site and species specific research on a range of areas such as feeding and nutrition, fish health and environmental effects, infrastructure and fish security.