Risks and uncertainties

6 Months Ended

Jun. 30, 2020

Risks and Uncertainties [Abstract]

Risks and uncertainties

Risks and uncertainties

In addition to the risks inherent in the Company’s industry and its stage of commercialization, the impact of the COVID-19 pandemic introduces a novel risk that is difficult to assess or predict. To date, the Company’s farm operations have not been adversely affected by the pandemic, although the Company has made modifications to its biosecurity procedures and its farm sites to adapt to local requirements and to provide a safe work environment.

The Company has experienced delays in capital projects due to the pandemic, including a delay in the completion of its processing facility at the Indiana farm. The delay in the completion of this project is expected to continue into the third quarter of 2020 and the Company is therefore considering third party alternatives for fish processing in the interim. The Company has also seen a reduction in the market price for Atlantic salmon due to the pandemic’s impact on demand in the food service sector. If sustained, this could impact the Company’s forecast in the near-term.

Concentration of credit risk

Financial instruments that potentially subject the Company to credit risk consist principally of cash and cash equivalents. This risk is minimized by the Company’s policy of investing in financial instruments with short-term maturities issued by highly rated financial institutions. The Company’s cash balances may at times exceed insurance limitations. The Company holds cash balances in bank accounts located in Canada to fund its local operations. These amounts are subject to foreign currency exchange risk, which is mitigated by the Company’s policy to limit the balances held in these accounts. Balances in Canadian bank accounts totaled $241 thousand at June 30, 2020.