CAQ HOLDINGS LIMITED — Interim / Quarterly Report 2008

Feb 28, 2008

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ASX Release

Half Yearly Report – Six Months to December 2007

SALES UP 220% WITH STRONG THRUST INTO SE ASIAN MARKETS

29 February 2008: Cell Aquaculture Limited (ASX:CAQ) results for the six months to 31 December 2007.

Highlights:

• 220% increase in sales to $1.3 million compared to the previous corresponding period

• Operating loss before once only write-offs and tax benefit, decreased by 34% to $0.9 million

• Net loss attributable to members of the Company was $2.2 million

• Terengganu joint venture commenced operations with initial 100 tonnes facility, and first fingerlings shipped from Cell’s hatchery in Townsville in January

• Memorandum of Understanding signed with Sarawak investment group for new 700 tonne barramundi farm

• Completion of two equity raisings for a total of $2.4 million

Strong Sales Growth: (Up 220%) Revenue from sales of Cell’s proprietary technology and systems grew strongly to $1,383,342 during the period mainly reflecting the sale, installation, fit-out and commissioning of the first 100 tonnes at the Terengganu joint venture barramundi farm in Malaysia.

System sales of Cell’s technology are an important cash flow strategy for the Company in helping support the lead times required before aquaculture farms become profitable.

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Over the coming 36 months Cell expects significant increases in income from aquaculture systems, as both Malaysian joint ventures, continue to build up to approximately 1800 tonnes of barramundi production capacity.

Operating Loss: The operating loss was $899,539 before charging the following non-recurring items totalling $1,321,992, which resulted in a total loss attributable to members of $2,235,031:

• Holland: Cell is focusing on south east Asia and as a result the Directors have reviewed the European strategy and decided that the loans to the Dutch operation should be writtenoff during the period with the result that $702,285 has been expensed in the accounts. Plant and equipment in Holland was also written down by $39,568.

• Further losses totalling $292,339 were incurred from the closure of the Group’s Mississippi operations, including a provision for settlement of a legal dispute with Cell’s joint venture partner, which is close to resolution.

• An expense of $287,800 was charged in relation to the valuation of options granted to Directors as required under AASB2: Share based payments.

Terengganu: Cell’s joint venture with the Malaysian State Government of Terengganu is proceeding on time and on budget. Commissioning of the initial 100 tonnes of a proposed 1100 tonnes multi-species farm was completed in December 2007 with the first barramundi fingerlings air-freighted from Cell’s hatchery in Townsville to Malaysia in January 2008. The first sales from the farm are expected in October 2008.

Planning is now well under way to commence the next stage of the farm’s expansion by the installation of a further 500 tonnes per anum capacity.

Sarawak: During the period Cell entered into negotiations with ASSAR, the investment arm of the State Government of Sarawak to build and manage a 700 tonne pa farm in Sarawak through a joint venture company to be owned 40% by Cell and 60% by ASSAR.

This culminated in the signing of a Memorandum of Understanding post balance date. Subject to due diligence and documentation the parties expect to conclude formal contracts and to commence the project in the second half of calendar 2008.

Capital Raising: Cell undertook two capital raisings during the period 1 July 2007 to the date of this report raising a total of $2.4 million to fund working capital and operations in Malaysia.

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