Largest Silver Producer in U.S. and Canada Conference Call FIRST QUARTER 2025 RESPONSIBLE. SAFE. INNOVATIVE. Cautionary Statements HECLA MINING COMPANY NYSE: HL FIRST QUARTER 2025 CONFERENCE CALL Cautionary Statement Regarding Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbor creat ...

Group 1 - The article does not provide any specific investment recommendations or advice regarding securities transactions [2][3] - It emphasizes that past performance is not indicative of future results, highlighting the inherent risks in investment decisions [3] - The content is intended for informational purposes only and does not constitute an offer to buy or sell securities [2][3] Group 2 - The article mentions the importance of position sizing in the volatile precious metals sector, suggesting that investments in small-cap precious metals stocks should be limited to 5% or less of an investor's portfolio [2]

Group 1 - Gold mining stocks are currently experiencing high demand due to economic uncertainty, inflation fears, and potential tariff wars, making them a popular choice for investors seeking safety [1] - The article emphasizes that gold miners are a classic investment option during times of economic instability, highlighting their traditional role as a flight-to-safety asset [1] Group 2 - The author has extensive experience in investment analysis, focusing on deep-discount value plays and underappreciated companies, which may indicate a strategic approach to identifying investment opportunities in the gold mining sector [1]

Financial Data and Key Metrics Changes - The company reported record quarterly revenues of $261 million, with a significant increase in silver margins from 54% in 2024 to 65% in Q1 2025 [17][12] - Adjusted EBITDA exceeded $90 million, driven by higher metal prices and solid contributions from all operating mines [12][17] - The net leverage ratio improved from 2.7 times to 1.5 times, with a cash position of approximately $20 million at the end of the quarter [13][14] Business Line Data and Key Metrics Changes - Greens Creek produced 2 million ounces of silver, with a 10% increase in silver grade compared to the previous quarter [18] - Lucky Friday achieved a quarterly milling record of almost 109,000 tons, producing 1.3 million ounces of silver [20] - Keno Hill produced over 770,000 ounces of silver and delivered its first profitable quarter under Hecla's ownership [23][24] Market Data and Key Metrics Changes - 45% of revenue came from silver, 33% from gold, and 22% from base metals, benefiting from improved gold prices [17] - The company maintained its production and capital investment guidance for the year, with adjustments to individual asset cost projections [12] Company Strategy and Development Direction - The company focuses on operational excellence, optimizing its portfolio for maximum returns, and maintaining financial discipline with a structured capital allocation framework [9][10][12] - Commitment to silver market leadership as the largest producer in the U.S. and Canada, with a focus on ESG practices [9][10] - The company is evaluating strategic alternatives for Casa Berardi, including potential sale or joint venture [16][90] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's promising future, emphasizing the importance of operational improvements and disciplined capital allocation [6][10] - The company is prepared for potential impacts from tariffs but has not yet seen significant disruptions in supply chains [35][39] - Future profitability at Keno Hill will depend on achieving higher throughput rates and successful permitting processes [24][55] Other Important Information - The company is investing over $3.3 million in targeted exploration programs in Nevada, focusing on high-grade properties [27] - The Libbey exploration project in Montana has secured a significant milestone for federal permitting [11] Q&A Session Summary Question: Impact of tariffs on operations - Management acknowledged potential minor impacts on consumables but noted proactive measures to stock parts [35][39] Question: Downtime during turbine repairs - The turbine repair is expected to last six days in August, with an estimated impact of 90,000 ounces of silver [43][44] Question: Keno Hill's production capacity - Management indicated that achieving a sustainable mining rate of 600 tons per day will take time and requires further permitting [50][55] Question: Updates on Casa Berardi sale - The company is exploring all strategic alternatives for Casa Berardi and will provide updates in Q2 [90][91] Question: Labor cost increases at Lucky Friday - Labor costs have risen due to increased contractor use and profit-sharing programs linked to strong performance [81][82]

Financial Data and Key Metrics Changes - The company reported record quarterly revenues of $261 million, with a 45% contribution from silver, 33% from gold, and 22% from base metals [18][19] - Adjusted EBITDA exceeded $90 million, driven by higher metal prices and solid contributions from all operating mines [13][18] - The net leverage ratio improved from 2.7 times to 1.5 times, with a cash position of approximately $20 million at the end of the quarter [14][18] Business Line Data and Key Metrics Changes - Greens Creek produced 2 million ounces of silver, with a 10% increase in silver grade, and cash costs were significantly better than annual guidance [19][20] - Lucky Friday achieved a quarterly milling record of almost 109,000 tons, producing 1.3 million ounces of silver, but faced cost pressures with cash costs at $9.37 per ounce [22][23] - Keno Hill produced over 770,000 ounces of silver and delivered its first profitable quarter under Hecla's ownership, with a gross profit of $1 million [24][25] Market Data and Key Metrics Changes - Silver prices increased, leading to improved silver margins from 54% in 2024 to 65% in the current quarter [18] - The company maintained its production and capital investment guidance for the year, with adjustments to individual asset cost projections [13][18] Company Strategy and Development Direction - The company focuses on operational excellence, optimizing its portfolio for maximum returns, and maintaining financial discipline with a structured capital allocation framework [10][11] - Commitment to silver market leadership as the largest producer in the U.S. and Canada, with long-lived mines in top-tier jurisdictions [10][11] - The company is exploring disciplined acquisition strategies aligned with its core strengths [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's promising future, emphasizing the importance of environmental stewardship and community partnerships [7][11] - The strategic review of Casa Berardi is ongoing, with options including outright disposal or joint ventures [17][88] - Management acknowledged challenges in permitting timelines but remains optimistic about the potential for Keno Hill and Nevada assets [50][91] Other Important Information - The company is investing over $3.3 million in a targeted exploration program at its high-grade properties in Nevada [28] - The Libbey exploration project in Montana secured placement on the FAST 41 permitting dashboard, streamlining federal approvals [12] Q&A Session Summary Question: Impact of tariffs on operations - Management noted that while there may be higher costs for consumables like rebar and steel due to tariffs, they have not experienced significant delays in parts availability [35][36][38] Question: Turbine repair downtime at Yukon Energy Corporation - The turbine repair is expected to last six days in August, with an estimated impact of losing 90,000 ounces of silver during that period [43][44] Question: Keno Hill's production capacity and permitting - Management indicated that reaching a sustainable mining rate of 600 tons per day will take several years, with a focus on ramping up production at existing deposits [50][54] Question: Updates on Casa Berardi sale - The company is exploring all strategic alternatives for Casa Berardi, including potential sale or joint ventures, with an update expected in Q2 [88][89] Question: Confidence in cost guidance revisions - Management expressed confidence in the revised cost guidance, noting that profit-sharing could lead to lower costs if metal prices decline [100][101]

Financial Data and Key Metrics Changes - The company reported record quarterly revenues of $261 million, with adjusted EBITDA exceeding $90 million, driven by higher metal prices and solid contributions from all operating mines [12][17] - The net leverage ratio improved from 2.7 times to 1.5 times, and the cash position improved to approximately $20 million [13][14] - Silver margins increased from 54% in 2024 to 65% in the current quarter [17] Business Line Data and Key Metrics Changes - Greens Creek produced 2 million ounces of silver, with a 10% increase in silver grade, and cash costs were significantly better than annual guidance [18] - Lucky Friday achieved a quarterly milling record of almost 109,000 tons, producing 1.3 million ounces of silver, but faced cost pressures with cash costs at $9.37 per ounce [20] - Keno Hill produced over 770,000 ounces of silver and delivered its first profitable quarter under Hecla's ownership [22] Market Data and Key Metrics Changes - 45% of revenue came from silver, 33% from gold, and 22% from base metals, benefiting from improved gold prices [17] - The company remains committed to silver market leadership as the largest producer in the U.S. and Canada [9] Company Strategy and Development Direction - The company’s strategy is built on four pillars: operational excellence, portfolio optimization, financial discipline, and silver market leadership [6][8] - A disciplined acquisition strategy is being developed, focusing on maintaining a strong silver revenue mix while considering gold opportunities [11][12] - The company is committed to environmental stewardship and community partnerships, ensuring leadership in ESG practices [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's promising future, emphasizing the importance of operational excellence and cost control [6][10] - The company is focused on generating strong free cash flow while deleveraging and enhancing financial flexibility [29] - There are ongoing strategic reviews for Casa Berardi, with potential options including outright disposal or joint ventures [15][90] Other Important Information - The company is investing over $3.3 million in a targeted exploration program in Nevada, focusing on high-grade properties [27] - The Libbey exploration project has secured a significant milestone for federal permitting, which can streamline approvals [11] Q&A Session Summary Question: Impact of tariffs on operations - Management noted that while there may be higher costs for materials like rebar and steel due to tariffs, they have not experienced significant delays in parts availability [34][39] Question: Turbine repair downtime at Yukon Energy Corporation - The turbine repair is expected to last six days in August, with an estimated impact of losing 90,000 ounces of silver during that period [44][45] Question: Keno Hill's production capacity and permitting - Management indicated that achieving a sustainable mining rate of 600 tons per day will take time and is contingent on obtaining necessary permits [49][102] Question: Updates on Casa Berardi's strategic review - The company is exploring various strategic alternatives for Casa Berardi, including potential sales or joint ventures, with an update expected in Q2 [90][95] Question: Labor cost increases at Lucky Friday - Labor costs have risen due to increased use of contractors and profit-sharing programs linked to strong performance [80][82]

Hecla Mining (HL) came out with quarterly earnings of $0.04 per share, beating the Zacks Consensus Estimate of $0.03 per share. This compares to earnings of $0.01 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 33.33%. A quarter ago, it was expected that this precious metals company would post earnings of $0.04 per share when it actually produced earnings of $0.04, delivering no surprise.Over the last four quarters, the compan ...

Financial Performance - Hecla Mining Company reported sales of $261,339,000 for the three months ended March 31, 2025, a 38% increase from $189,528,000 in the same period of 2024[10]. - Gross profit for the quarter was $74,004,000, compared to $19,160,000 in the prior year, reflecting a significant improvement in profitability[10]. - Net income applicable to common stockholders was $28,734,000, a turnaround from a net loss of $5,891,000 in the same quarter of 2024[10]. - The company reported a comprehensive income of $31,306,000 for the quarter, compared to a comprehensive loss of $11,156,000 in the same period last year[10]. - For the three months ended March 31, 2025, total metal sales reached $254.251 million, a significant increase from $185.081 million in the same period of 2024, representing a growth of approximately 37.4%[28]. - The company reported a net income of $28.872 million for Q1 2025, compared to a net loss of $5.753 million in Q1 2024, indicating a turnaround in financial performance[17]. - Total consolidated sales for Q1 2025 were $261.339 million, compared to $189.528 million in Q1 2024, representing an increase of about 37.9%[28]. - The company’s operating income for Q1 2025 was $52.355 million, a significant increase from an operating income of $5.064 million in Q1 2024, highlighting improved operational efficiency[23][24]. - Basic earnings per common share improved to $0.05 for the three months ended March 31, 2025, compared to a loss of $0.01 per share in the prior year[38]. Cash Flow and Liquidity - The company generated $35,738,000 in net cash from operating activities, up from $17,080,000 in the previous year[12]. - Cash and cash equivalents decreased to $23,668,000 from $80,169,000 year-over-year, indicating a tighter liquidity position[12]. - The company declared a quarterly dividend of $0.00375 per common share during the three months ended March 31, 2025[43]. - The company had net borrowings of $20.0 million on its revolving credit facility, resulting in $43.0 million outstanding at an interest rate of 6.7% as of March 31, 2025[175]. - As of March 31, 2025, the company had $23.7 million in cash and cash equivalents, with $43.0 million drawn on its $225 million credit facility[162]. Capital Expenditures and Investments - Hecla Mining Company incurred $54,095,000 in capital expenditures for property, plant, and mine development during the quarter[12]. - Capital additions for the three months ended March 31, 2025, totaled $54.095 million, compared to $47.589 million in the same period of 2024, indicating ongoing investment in operations[23][24]. - The company estimates exploration and pre-development expenditures will total approximately $28.0 million in 2025, with $4.5 million already incurred as of March 31, 2025[168]. - Capital expenditures for 2025 are estimated to be between $222 million and $242 million, with $54.1 million already incurred as of March 31, 2025[168]. Debt and Obligations - Long-term debt as of March 31, 2025, was $515,412 thousand, compared to $495,184 thousand as of December 31, 2024, reflecting an increase of approximately 4.1%[45]. - The total debt as of March 31, 2025, was $549,024 thousand, an increase from $528,801 thousand as of December 31, 2024[46]. - Total contractual cash obligations amount to $730.7 million as of March 31, 2025, with significant obligations due in the next 1-3 years[176]. - The company anticipates incurring future expenditures related to mine closure and environmental obligations totaling $126.1 million over the next 30 years[177]. Production and Sales - Hecla Mining Company produced 4.1 million ounces of silver, with increased production at Lucky Friday and Keno Hill offsetting decreases at Greens Creek[100]. - Silver sales for Q1 2025 amounted to $118.153 million, up from $86.233 million in Q1 2024, marking a year-over-year increase of approximately 37%[28]. - Sales for the Greens Creek segment rose to $118.1 million in Q1 2025, up from $97.3 million in Q1 2024[112]. - Keno Hill recorded sales of $16.9 million for the three months ended March 31, 2025, compared to $10.8 million in the same period of 2024, representing a 56.5% increase attributed to higher realized sales prices and volumes[130]. - Casa Berardi's sales increased to $56.0 million in Q1 2025 from $41.6 million in Q1 2024, with a gross profit of $5.3 million compared to a gross loss of $16.7 million in the prior year[138][140]. Cost Structure and Efficiency - The cost of sales and other direct production costs for Q1 2025 was $187.335 million, compared to $170.368 million in Q1 2024, reflecting increased operational costs associated with higher sales[23][24]. - Cash Cost per ounce of silver was reported at $1.29, while All-In Sustaining Cost (AISC) was $11.91 for the three months ended March 31, 2025[104]. - Cash Cost, After By-product Credits, per Silver Ounce decreased to $(4.08) in Q1 2025 from $3.45 in Q1 2024, primarily due to increased by-product credits[117]. - AISC, After By-product Credits, per Silver Ounce improved to $(0.03) in Q1 2025 compared to $7.16 in Q1 2024, benefiting from lower sustaining capital expenditures[117]. - By-product credits for the total silver properties amount to $86.164 million, significantly impacting the overall cost structure[157]. Market and Economic Factors - The company’s financial results are influenced by fluctuations in market prices for silver, gold, zinc, lead, and copper, with potential impacts from tariffs and trade restraints[96]. - The company faces potential adverse impacts from tariffs, particularly a 10% baseline tariff and 125% tariffs on products sold to China, which could materially affect its financial condition and results of operations[200]. - The company has significant sales of products shipped to Asia, indicating reliance on maritime transport operators[201]. Internal Controls and Compliance - The company evaluated the effectiveness of its disclosure controls and procedures as of March 31, 2025, concluding they were effective[194]. - The company’s internal control systems are designed to provide reasonable assurance regarding financial statement preparation, despite inherent limitations[195]. - No changes in internal control over financial reporting materially affected the company during the three months ended March 31, 2025[194].

Financial Performance - Generated record sales of $261.3 million, a 5% increase over the prior quarter[5] - Reported net income applicable to common stockholders of $28.7 million, or $0.05 per share, compared to $11.8 million in the prior quarter[12] - Achieved record Adjusted EBITDA of $90.8 million during the quarter, a 5% increase over the prior quarter, with a net leverage ratio improved to 1.5x from 1.6x[16] - Free cash flow was negative $18.4 million, compared to positive $6.7 million in the prior quarter, primarily due to lower cash flow from operations[20] - Sales for the three months ended March 31, 2025, increased to $261,339,000 from $249,655,000 in the previous quarter, representing a growth of approximately 4.3%[97] - Gross profit rose to $74,004,000, compared to $68,334,000 in the prior quarter, reflecting an increase of about 8.9%[97] - Net income applicable to common stockholders for the quarter was $28,734,000, significantly up from $11,786,000 in the previous quarter, marking an increase of approximately 143%[97] - Basic income per common share increased to $0.05 from $0.02, indicating a 150% rise[97] Production and Sales - Produced 4.1 million ounces of silver and 34,232 ounces of gold, with silver production at Keno Hill increasing by 23% over the fourth quarter of 2024[5] - Greens Creek produced 2.0 million ounces of silver, a 5% increase from the prior quarter, due to a 10% increase in silver grade milled[23] - Lucky Friday produced 1.3 million ounces of silver, flat compared to the prior quarter, with lead and zinc production declining by 2% and 3% respectively[32] - Keno Hill produced 772,430 ounces of silver, a 23% increase over the prior quarter, with mill throughput averaging 305 tons per day[39] - Casa Berardi produced 20,473 ounces of gold, a 2% decrease over the prior quarter, due to lower underground grades and total milled tons[48] - Total ounces produced in the three months ended March 31, 2025, was 2.0 million, compared to 1.33 million in the same period of 2024, representing a 50% increase[109] Costs and Expenses - Consolidated silver total cost of sales was $129.6 million, an increase of 5% from the prior quarter, primarily due to higher production costs[13] - Cash costs and AISC per silver ounce were $1.29 and $11.91, respectively, higher than the prior quarter due to increased production costs[14] - Total cost of sales for Greens Creek was $69.6 million, a 3% increase over the prior quarter, primarily due to higher labor and fuel costs[25] - Total cost of sales for Lucky Friday was $44.0 million, up 10% over the prior quarter, driven by higher depreciation and labor costs[34] - Total cost of sales for Casa Berardi was $50.7 million, a 2% decrease over the prior quarter, with cash costs per gold ounce at $2,195 and AISC at $2,303[50] - Total cost of sales for the three months ended March 31, 2025, was $223,610,000 compared to $244,140,000 for the three months ended December 31, 2024, representing a decrease of approximately 8.4%[111] Guidance and Future Outlook - The company plans to strengthen the balance sheet in 2025 by targeting high-risk adjusted return projects and increasing free cash flow generation[8] - Production guidance for 2025 at Greens Creek is maintained at 8.1-8.8 million ounces of silver and 44.0-48.0 thousand ounces of gold[29] - Lucky Friday maintains silver production guidance of 4.7-5.1 million ounces, with cost of sales revised up to $165 million from $135 million[36] - Casa Berardi production guidance for 2025 remains at 76.0-82.0 koz of gold, with cost of sales revised up to $180 million from $165.5 million[52] - Consolidated silver production is expected to be 15.5-17.0 million ounces and gold production is expected to be 120-130 koz in 2025[69] - Future guidance indicates an expected increase in production capacity by 15% in the next fiscal year, driven by new technology implementations[109] Strategic Initiatives - The company plans to expand its market presence through strategic acquisitions and new product developments in the upcoming quarters[109] - The company is considering strategic alternatives for Casa Berardi, including potential disposal or joint venturing[54] - The company is focusing on sustainability initiatives, with a projected increase in reclamation costs to $3.1 million, up from $2.1 million[109] - The company is actively exploring the Gallagher Definition zone, with drillhole GC6604 yielding 56.8 oz/ton of silver over a true width of 4.4 feet[128] - The company remains committed to advancing its exploration strategy to unlock additional value from its assets[128] Exploration and Development - Exploration and pre-development expenses totaled $4.5 million in the first quarter, with increased spending anticipated in the second and third quarters[56] - The Libby Exploration Project has inferred resources of 183.3 million ounces of silver and 759 thousand tons of copper, currently under environmental assessment review[65] - The company is focusing on expanding its exploration activities in the Yukon region, particularly in the Keno Hill area[126] - The drilling results from the Greens Creek project indicate significant silver and gold grades, with a notable sample showing 278.0 oz/ton of silver over a true width of 2.8 feet[128] Cash Flow and Capital Expenditures - Cash flow from operations for Keno Hill was negative $9.7 million, reflecting unfavorable working capital changes[42] - Cash flow from operations decreased by 20% to $9.9 million due to unfavorable working capital changes[51] - The company reported a decrease in accounts payable and other current accrued liabilities to $114,933,000 from $127,988,000, a reduction of about 10%[101] - The company incurred $54,095,000 in additions to properties, plants, and equipment in Q1 2025[123] - Cash provided by operating activities for Q1 2025 was $1,060,150,000, a decrease from $317,861,000 in Q1 2024[124]

Company Overview - Hecla Mining (HL) shares increased by 12.1% to $5.28 in the last trading session, following a significant volume of shares traded, contrasting with a 13.3% loss over the past four weeks [1] - The company is expected to report quarterly earnings of $0.04 per share, reflecting a year-over-year increase of 300%, with revenues projected at $236.27 million, up 24.7% from the previous year [2] Earnings Estimates and Trends - The consensus EPS estimate for Hecla Mining has been revised 30% lower in the last 30 days, indicating a negative trend in earnings estimate revisions, which typically does not lead to price appreciation [3] - Empirical research suggests that trends in earnings estimate revisions are closely linked to near-term stock price movements, highlighting the importance of monitoring these changes [2][3] Industry Context - Hecla Mining is part of the Zacks Mining - Silver industry, where Buenaventura (BVN) also operates, having closed the last trading session up 7.6% at $13.92, but with a -5.1% return over the past month [3] - Buenaventura's consensus EPS estimate remains unchanged at $0.36, representing a 50% increase compared to the previous year, and it currently holds a Zacks Rank of 4 (Sell) [4]