Angel Seafood Holdings Limited announced that, having achieved production capacity of over 10 million oysters per annum and a profitable operating base, the Company has commenced its next phase of growth which includes the acquisition of 6.25Ha of premium Eyre Peninsula water leases, and the commencement of new-age biodynamic flip-farming trials to drive increased yields. Key highlights: Angel launches 3-pillar growth strategy to increase production and profitability through scale, innovation and price; 6.25Ha of premium Eyre Peninsula water leases secured through leasing arrangements; production capacity immediately increases to 12 million oysters per annum; Board approves flip-farming trials in Coffin Bay on 3.0Ha of deep-water leases; Retail presence gaining traction with features in Costco and Drakes catalogues 3-pillar growth strategy rolled out to support next phase of growth The Company's low-capital growth strategy will aim to further increase Angel's production capacity and improve profitability. Underpinning the strategy are the following pillars: Increase water leases within the Eyre Peninsula to maximise the economies of scale; Focus on increasing productivity and lowering costs through innovation; Building the Angel brand to improve oyster pricing. Eyre Peninsula, increasing the production capacity of successful Multi-Bay Strategy. Angel's vision is to double its production capacity within the Eyre Peninsula to 20 million oysters per annum in order to further improve profitability and grow the supply of premium Angel oysters. Angel has built significant intellectual property in harnessing the attributes of each of the bays from its Multi-Bay Strategy to produce a superior product. Increasing scale further consolidates Angel's position as the Southern Hemisphere's largest sustainable and organic certified pacific oyster producer. Angel has secured, through lease agreements, an additional 6.25Ha to expand operations within the Eyre Peninsula. The new leases are a strong addition to Angel's portfolio of water assets due to their prime location, with 4.25Ha in Coffin Bay and 2.0Ha in Cowell. 2.0Ha of the new leases in Coffin Bay come with existing good quality infrastructure that is available for use, immediately increasing production capacity from 10 million to 12 million oysters per annum. The 6.25Ha of water leases will be held under leasing agreements with terms ranging from 6-15 years (including renewals) at an aggregate cost of $138k per annum, with options to buy at the end of the lease periods, or first right of refusal. The lease costs will be fully funded through operating cash flows. Pillar 2: Increasing productivity though innovation; FlipFarm1 trials to commence in Coffin Bay In line with Angel's objectives to increase productivity and lower costs through innovation, the Board has approved the trial of a new bio-dynamic oyster farming system, called "FlipFarm", in Angel's highly productive waters in Coffin Bay. The development of this innovative bio-dynamic farming method will be funded from Angel's existing balance sheet and the benefits of increased productivity and lower operation costs are expected to generate an attractive internal rate of return and short capital payback period. Whilst this will be the first time this modern farming method has been trialled on the Eyre Peninsula, FlipFarm systems have been successfully applied in New Zealand and are known to increase productivity and require less labour, thereby significantly lowering operating costs. Pillar 3: Building the Angel brand to improve pricing Following Angel's success in building out a retail sales program and ongoing strong demand through the retail channel, Angel will be focusing on its premium brand positioning to improve its pricing. Angel's ability to guarantee the continuous supply of organic, sustainable and high-quality oysters has enabled the Company to achieve strong traction with major retailers over the past month, selling into most key retail chains and also benefiting from some retailers undertaking specific "Angel oysters" marketing campaigns, including being featured in Costco's Christmas catalogue and Drakes' weekly catalogue. Angel's growing recognition in the retail channel positions the Company to leverage its credentials in retail relationships and building a brand. The demand for oysters from the retail channel is a great step forward for the oyster industry. The combination of strong momentum in the retail channel and increasing patronage in the restaurant channel following the easing of COVID-19 restrictions, means Angel is heading into the peak Christmas period in a strong position. This announcement was approved for release by the Board.