Hecla Mining pany(US:HL)2025-11-06 16:00Financial Data and Key Metrics Changes - Hecla Mining Company reported record revenues of $410 million for Q3 2025, with net income of $101 million and adjusted EBITDA of $196 million, indicating strong operational performance [5][6][8] - The net leverage ratio improved significantly from 1.8 times last year to 0.3 times in Q3 2025, representing an 83% reduction [6][8] - Operating cash flow generated was $148 million, with consolidated free cash flow at $90 million [6][9] Business Line Data and Key Metrics Changes - Silver production reached 4.6 million ounces, a 2% increase from the previous quarter, with cash costs at negative $2.03 per ounce and all-in sustaining costs at $11.01 [7][8] - Greens Creek produced 2.3 million ounces of silver, with sales of $178 million, up 46% from the last quarter [14] - Lucky Friday's silver production was 1.3 million ounces, with free cash flow nearly tripling to $13.5 million [15] - Keno Hill achieved silver production of nearly 900,000 ounces, generating $8.3 million in free cash flow [16] - Casa Berardi produced 25,000 ounces of gold, with cash costs of $1,582 per ounce [17] Market Data and Key Metrics Changes - Silver revenue accounted for 48% of total mine site revenues, followed by gold at 37% [8] - Silver margins remained robust at $31.57 per ounce, representing 74% of the realized price of silver [8] Company Strategy and Development Direction - The company is focused on long-term value creation, operational execution, and maintaining financial flexibility to pursue growth opportunities [19][48] - A disciplined capital allocation framework prioritizes safety, sustaining capital, growth capital, exploration, deleveraging, and shareholder returns [10][12] - The company plans to increase exploration investments, particularly in Nevada, targeting 2%-5% of revenues for exploration in 2026 [11][18] Management's Comments on Operating Environment and Future Outlook - Management highlighted the ongoing supply shortages in silver and the favorable market conditions expected to support prices for years [5][6] - The company expressed confidence in its ability to generate substantial free cash flow and maintain operational momentum across all assets [6][48] - The outlook for Keno Hill includes plans for commercial production around 2027, contingent on regulatory approvals [38] Other Important Information - The company has successfully de-risked its balance sheet, eliminating over $15 million in annual interest expense [6][8] - All four producing assets generated positive free cash flow for the second consecutive quarter, demonstrating operational strength [6][9] Q&A Session Summary Question: Inflationary factors affecting asset base - Management noted that labor competition and tariff costs are the main inflationary pressures, but overall impacts have been muted [24][25] Question: Exploration spending and labor costs - Drilling costs have increased due to labor, but assay turnaround times have remained normal [27] Question: Exploration and project updates - The company plans to significantly increase its exploration budget in Nevada and reinitiate dormant projects [32][33] Question: Guidance and production expectations - Management explained that production profiles can vary, and guidance reflects expected performance based on historical data [41][42] Question: Strong price realizations in the quarter - The strong price realizations were attributed to timing of shipments and the use of collars for provisional hedging [43][44]