Heavy losses at Seafarms ahead of court decision

Prawn producer Seafarms has posted a $19.6 million loss for the year, while its flagship Project Sea Dragon prawn farm continues to face uncertainty.

Revenue at the Perth-headquartered producer declined by almost $500,000 to $25.6 million, with the drop coming primarily from climate conditions impacting black tiger prawn production at its Ingham farm in Queensland.

Seafarms chief executive Peter Fraser said the past year had been one of continued assessment and development of Project Sea Dragon.

“During the first half of the year, the Queensland operation performed well, particularly due to the banana prawn crop, which now exclusively servers the ‘fresh’ option in Australia during spring, summer, and peak Christmas markets,” he said.

Project Sea Dragon, the long mooted 10,000-hectare black tiger prawn farm near at Legune Station near Kununurra, would be one of the largest prawn projects in the world.

However, its future remains uncertain.

In February 2023, the company entered a trading halt as Seafarms placed the project into liquidation.

Just three months later the company announced it remained committed to the project.

However, in February 2024, the Australian Federal Court ordered the company into liquidation after Canstruct, the contractor selected to build the first phase of the project, sued for an alleged $13.9 million outstanding bill.

In his findings at the time, Australian Court Justice Michael Derrington found the company abused the Corporations Act.

The liquidation was then stayed pending an appeal, which took place on August 12 and 13, with a judgement now pending.

Despite the project still being in limbo, Seafarms has pushed ahead with the sale of two farms from its Queensland operations, expected to settle in April 2025, to release capital for further PSD investment.