10% silver production growth in 2022; Expect
18% growth in 2023 and 35% by 2025; Silver cost guidance achieved
with 2023 set at similar levels
Hecla Mining Company (NYSE:HL) today announced fourth quarter
and full-year 2022 financial and operating results.
ANNUAL HIGHLIGHTS
Strategic
- Completed the acquisition of Alexco Resource Corp., adding
nearly 50 million ounces of silver reserves; highest-grade and
largest primary silver reserves in Canada.
Operational
- Record silver reserves of 241 million ounces, gold reserves of
2.6 million ounces.
- Produced 14.2 million ounces of silver, Hecla's second highest,
and 175,807 ounces of gold.
- Record lead production of 49 thousand tons and zinc production
of 65 thousand tons.
- Achieved silver cost guidance with total silver cost of sales
of $349.3 million and all-in sustaining cost after by-product
credits ("AISC") of $11.25 per silver ounce.4
- Increased Lucky Friday silver production by 24% to 4.4 million
ounces using the Underhand Closed Bench (UCB) mining method.
- Achieved record mill throughput milestones at all three
operations.
Financial
- Reported sales of $718.9 million with almost 70% from Greens
Creek and Lucky Friday.
- Net loss applicable to common stockholders of $37.9 million or
$0.07 per share, and adjusted net income of $27.8 million or $0.05
per share.5
- Adjusted EBITDA of $217.5 million, net debt to adjusted EBITDA
ratio of 1.9.1
- Strong balance sheet with $104.7 million in cash and cash
equivalents with approximately $245 million in available
liquidity.
- Dividends of $12.9 million, or 14% of cash flow from
operations.
Environmental, Social, Governance
- Strong safety performance with an All-Injury Frequency Rate of
1.22, which equals prior Company record and is 42% below the U.S.
average.
- The San Sebastian mine received the 2022 Environmental and
Sustainability Excellence Award given by AEMA.
- Lucky Friday received the SME Murray Innovation Award for 2023
for the pioneering UCB mining method.
- Ratified a 6-year contract agreement with the Union at the
Lucky Friday.
“Hecla is the world’s fastest growing established silver
company,” said Phillips S. Baker Jr., President and CEO. “This
growth has been built on the strong foundation of Greens Creek, the
United States’ largest silver mine, and the Lucky Friday, a mine in
production for 80 years whose throughput this year was the most in
its history. Added to these growing mines is Keno Hill, one of the
world’s highest grade silver mines, which we expect to be in
production in the second half of this year."
Baker continued, “In 2022, we achieved our largest silver
reserves and second highest silver production in our history, and
expect to set new records in 2023 and 2024. If our growth continues
as expected, Hecla would produce not only 40% of all the silver
mined in the US, but also 40% of all silver mined in Canada. In
2022, we had among the best silver margins in the industry with
AISC a little more than half of our realized silver price allowing
us to maintain a strong balance sheet even after significant
investment in the Lucky Friday and Keno Hill. We expect silver AISC
in 2023 to be about the same as 2022 despite inflationary pressures
and increased investment in all our mines. With our largest silver
reserves, our growing production in Canada and the US, and strong
silver margins, we believe our shareholders are well-positioned for
higher silver prices as the transition to renewables increases the
need for silver as an energy metal."
FINANCIAL OVERVIEW
In the following table and throughout this release, "total cost
of sales" is comprised of cost of sales and other direct production
costs and depreciation, depletion and amortization.
In Thousands unless stated otherwise
4Q-2022
3Q-2022
2Q-2022
1Q-2022
4Q-2021
FY 2022
FY 2021
FINANCIAL AND PRODUCTION
SUMMARY
Sales
$
194,825
$
146,339
$
191,242
$
186,499
$
185,078
$
718,905
$
807,473
Total cost of sales
$
169,807
$
137,892
$
153,979
$
141,070
$
131,837
$
602,749
$
589,672
Gross profit
$
25,018
$
8,447
$
37,263
$
45,429
$
53,241
$
116,156
$
217,801
Income (loss) applicable to common
stockholders
$
(4,590
)
$
(23,664
)
$
(13,661
)
$
4,015
$
11,737
$
(37,900
)
$
34,543
Basic income (loss) per common share (in
dollars)
$
(0.01
)
$
(0.04
)
$
(0.03
)
$
0.01
$
0.02
$
(0.07
)
$
0.06
Adjusted EBITDA1
$
62,261
$
26,554
$
70,474
$
58,202
$
58,249
$
217,492
$
278,780
Net Debt to Adjusted EBITDA1
1.9
1.1
Cash provided by operating activities
$
36,120
$
(24,322
)
$
40,183
$
37,909
$
53,355
$
89,890
$
220,337
Capital Expenditures
$
(56,140
)
$
(37,430
)
$
(34,329
)
$
(21,478
)
$
(28,838
)
$
(149,378
)
$
(109,048
)
Free Cash Flow2
$
(20,020
)
$
(61,752
)
$
5,854
$
16,431
$
24,517
$
(59,488
)
$
111,289
Silver ounces produced
3,663,433
3,549,392
3,645,454
3,324,708
3,226,927
14,182,987
12,887,240
Silver payable ounces sold
3,756,701
2,479,724
3,387,909
2,687,261
2,606,622
12,311,595
11,633,802
Gold ounces produced
43,634
44,747
45,719
41,707
47,977
175,807
201,327
Gold payable ounces sold
40,097
40,443
44,225
41,053
44,156
165,818
201,610
Cash Costs and AISC, each after
by-product credits
Silver cash costs per ounce3
$
4.79
$
3.43
$
(1.14
)
$
1.09
$
1.69
$
2.06
$
1.37
Silver AISC per ounce4
$
14.36
$
14.20
$
8.55
$
7.64
$
10.08
$
11.25
$
9.19
Gold cash costs per ounce3
$
1,696
$
1,349
$
1,371
$
1,516
$
1,143
$
1,478
$
1,127
Gold AISC per ounce4
$
2,132
$
1,738
$
1,641
$
1,810
$
1,494
$
1,825
$
1,374
Realized Prices
Silver, $/ounce
$
22.03
$
18.30
$
20.68
$
24.68
$
23.49
$
21.53
$
25.24
Gold, $/ounce
$
1,757
$
1,713
$
1,855
$
1,880
$
1,802
$
1,803
$
1,796
Lead, $/pound
$
1.05
$
0.95
$
0.97
$
1.08
$
1.13
$
1.01
$
1.03
Zinc, $/pound
$
1.24
$
1.23
$
1.44
$
1.79
$
1.74
$
1.41
$
1.44
Loss applicable to common stockholders decreased to $4.6 million
in the fourth quarter 2022 from $23.7 million in the third quarter
due to:
- Increased gross profit of $16.6 million due to higher revenues
arising from deferred silver concentrate shipments from Greens
Creek and Lucky Friday to the fourth quarter, higher realized
prices and production partially offset by higher cost of
sales.
- Exploration and pre-development expense decreased by $8.2
million due to the completion of seasonal exploration programs in
the prior quarter.
The above items were partially offset by:
- Increase in general and administrative expenses of $3.4 million
due to higher incentive compensation accruals and a full quarter of
additional staffing as a result of the Alexco acquisition.
- Increase of $2.9 million in provision for closed operations
reflecting updated costs for Troy mine reclamation.
- Higher ramp-up and suspension costs of $2.5 million related to
the Keno Hill ramp-up.
Consolidated silver cost of sales in 2022 increased 12% to
$349.3 million from the prior year due to higher labor costs
including contractor costs, and inflationary pressures for fuel,
consumables, ground support and other inputs. Cash costs and AISC
per silver ounce, each after by-product credits, were $2.06 and
$11.25, respectively.3,4 The increase in cash costs and AISC per
silver ounce was due to higher cost of sales, and increased
sustaining capital, partially offset by higher by-product credits
due to higher by-products and silver production.3,4
Consolidated gold cost of sales decreased by 9% to $253.0
million primarily due to Nevada operations were being on care and
maintenance. Cash costs and AISC per gold ounce, each after
by-product credits, were $1,478 and $1,825, respectively.3,4 The
increase in total cash costs was due to higher labor, contractor
costs, and inflation in diesel, reagents, and other key inputs as
well as lower gold production with AISC also impacted by higher
sustaining capital.
Loss applicable to common stockholders was $37.9 million in 2022
compared to net income of $34.5 million in 2021 with decrease in
profitability attributable to:
- Lower sales of $88.6 million due to lower gold production and
lower metal prices for silver, lead, and zinc, partially offset by
higher silver, lead and zinc production.
- Lower gross profit due to lower sales and higher production
costs.
- Higher general and administrative expenses of $8.8 million due
to higher incentive compensation accruals, compensation increases
effective July 1, and additional staffing as a result of the Alexco
acquisition.
- A decrease in income tax benefit of $22.0 million
The above items were partially offset by:
- Decrease in exploration and pre-development expense of $1.9
million.
- Fair value adjustments that resulted in a loss of $4.7 million
in 2022 compared to a loss of $35.8 million in 2021 as result of
lower realized and unrealized losses on derivatives and
investments.
- Decrease in provision for closed operations and environmental
matters of $5.8 million.
Adjusted EBITDA for the year was $217.5 million and decreased by
$61.3 million over the prior year primarily due to lower revenues
and higher production costs amidst inflationary pressures. The
ratio of Net debt to adjusted EBITDA increased to 1.9 due to lower
Adjusted EBITDA and use of cash as the Company invested in
development of the Keno Hill mine.1
Cash provided by operating activities was $89.9 million for 2022
and decreased $130.5 million year over year due to lower net income
and unfavorable working capital changes. When compared to the third
quarter, cash provided by operating activities increased by $60.4
million due to increased gross margin and monetization of zinc
hedges.
Capital expenditures, net of leases, totaled $149.4 million in
2022 compared to $109.0 million in 2021. The increase was due to
higher capital spend at Lucky Friday, as the Company invested in
the infrastructure necessary to increase throughput, sustaining
expenditures at Greens Creek, and development capital at the Keno
Hill partially offset by lower spend at Casa Berardi. Fourth
quarter capital expenditures totaled $56.1 million, including $12.2
million at Greens Creek, $13.0 million at Casa Berardi, $13.7
million at Lucky Friday, and $16.1 million at Keno Hill.
Free cash flow for the year was negative $59.5 million, a
decrease of $170.8 million over the prior year due to lower
revenues, higher production costs, higher capital spend at Lucky
Friday and Greens Creek, and investment in the Keno Hill
development. Free cash flow for the fourth quarter was negative
$20.0 million and increased by $41.7 million over the prior quarter
primarily due to higher cash flow from operations partially offset
by higher capital spend.2
Forward Sales Contracts for Base Metals and Foreign
Currency
The Company uses financially settled forward sales contracts to
manage exposures to changes in prices of zinc and lead. At December
31, 2022, the Company had contracts covering approximately 36% of
the forecasted payable zinc production for 2023 at an average price
of $1.34 per pound, and 40% of the forecasted payable lead
production (through 2024) at an average price of $0.99 per pound.
In the fourth quarter, the Company monetized zinc hedges for cash
proceeds of approximately $17.0 million.
The Company also manages CAD exposure through forward contracts.
At December 31, 2022, the Company had hedged approximately 46% of
forecasted CAD direct production costs for Casa Berardi through
2026 at an average CAD/USD rate of 1.31. The Company has also
hedged approximately 34% of capital costs for Casa Berardi for 2023
at 1.33. At Keno Hill, 74% of the planned spend for 2023 is hedged
at an average CAD/USD rate of 1.38.
OPERATIONS OVERVIEW
Greens Creek Mine - Alaska
Dollars are in thousands except cost per
ton
4Q-2022
3Q-2022
2Q-2022
1Q-2022
4Q-2021
FY 2022
FY 2021
GREENS CREEK
Tons of ore processed
230,225
229,975
209,558
211,687
221,814
881,445
841,967
Total production cost per ton
$
211.29
$
185.34
$
197.84
$
192.16
$
174.55
$
196.73
$
177.30
Ore grade milled - Silver (oz./ton)
13.1
13.6
14.0
13.8
12.6
13.6
13.5
Ore grade milled - Gold (oz./ton)
0.08
0.07
0.08
0.07
0.07
0.08
0.08
Ore grade milled - Lead (%)
2.6
2.4
3.0
2.8
2.6
2.7
2.9
Ore grade milled - Zinc (%)
6.7
6.3
7.2
6.6
6.3
6.7
7.1
Silver produced (oz.)
2,433,275
2,468,280
2,410,598
2,429,782
2,262,635
9,741,935
9,243,222
Gold produced (oz.)
12,989
11,412
12,413
11,402
10,229
48,216
46,088
Lead produced (tons)
4,985
4,428
5,184
4,883
4,731
19,480
19,873
Zinc produced (tons)
13,842
12,580
13,396
12,494
12,457
52,312
53,648
Sales
$
95,374
$
60,875
$
92,723
$
86,090
$
87,865
$
335,062
$
384,843
Total cost of sales
$
(70,075
)
$
(52,502
)
$
(60,506
)
$
(49,636
)
$
(49,251
)
$
(232,718
)
$
(213,113
)
Gross profit
$
25,299
$
8,373
$
32,217
$
36,453
$
38,614
$
102,344
$
171,730
Cash flow from operations
$
44,769
$
7,749
$
41,808
$
56,295
$
50,632
$
150,621
$
208,715
Exploration
$
1,050
$
3,776
$
929
$
165
$
696
$
5,920
$
4,591
Capital additions
$
(12,150
)
$
(6,988
)
$
(14,668
)
$
(3,092
)
$
(9,544
)
$
(36,898
)
$
(23,883
)
Free cash flow2
$
33,669
$
4,537
$
28,069
$
53,368
$
41,784
$
119,643
$
189,423
Cash cost per ounce, after by-product
credits3
$
4.26
$
2.65
$
(3.29
)
$
(0.90
)
$
0.50
$
0.70
$
(0.65
)
AISC per ounce, after by-product
credits4
$
9.04
$
8.61
$
3.48
$
1.90
$
5.66
$
5.77
$
3.19
Greens Creek produced 9.7 million ounces of silver in 2022, an
increase of 5% over the prior year achieving record mill
throughput.
Fourth quarter sales were $95.4 million, and increased $34.5
million over the third quarter due to higher realized prices,
increased by-product production and the favorable impact of a
deferred silver concentrate shipment from the third quarter
resulting in higher metals sold. Cost of sales for the quarter were
$70.1 million, an increase of $17.6 million over the prior quarter
with the increase attributable to higher costs related to higher
volumes of metals sold and higher fuel and consumables costs. Cash
costs and AISC per silver ounce, each after by-product credits,
were $4.26 and $9.04 and increased quarter over quarter due to
higher treatment and freight costs due to higher concentrate
quantities shipped, and higher costs related to fuel and
consumables as the mill achieved record throughput.3,4 Cash flow
from operations increased by $37.0 million over the prior quarter
due to increased sales and lower exploration spend partially offset
by higher costs. Free cash flow for the fourth quarter was $33.7
million, an increase of $29.1 million over the prior quarter due to
higher cash flow from operations partially offset by higher capital
spend.2
2022 sales were $335.1 million, a decrease of $49.8 million
compared to 2021 due to lower realized silver prices partially
offset by higher silver and gold production. Cost of sales
increased to $232.7 million compared to $213.1 million in 2021 due
to higher labor and contractor costs due to record tons mined,
inflationary pressures for fuel, reagents and other inputs, and
higher volumes of consumables as the mill achieved record
throughput in 2022. Cash costs and AISC per silver ounce (each
after by-product credits) were $0.70 and $5.77, respectively,
increasing year over year due to the reasons outlined above,
partially offset by higher by-product credits.3,4 The increase in
AISC was also impacted by higher exploration and sustaining capital
spend during the year. Cash flow from operations for the year was
$150.6 million, and decreased by $58.1 million over the prior year
due to lower revenues and higher production costs. Free cash flow
generation for the year was $119.6 million and declined by $69.8
million over the prior year due to lower cash flow from operations
and higher planned capital spend.2
Lucky Friday Mine - Idaho
Dollars are in thousands except cost per
ton
4Q-2022
3Q-2022
2Q-2022
1Q-2022
4Q-2021
FY 2022
FY 2021
LUCKY FRIDAY
Tons of ore processed
90,935
90,749
97,497
77,725
80,097
356,907
321,837
Total production cost per ton
$
232.73
$
207.10
$
211.45
$
247.17
$
198.83
$
223.55
$
191.50
Ore grade milled - Silver (oz./ton)
14.0
12.5
13.2
12.0
12.5
13.0
11.6
Ore grade milled - Lead (%)
9.1
8.5
8.8
8.2
8.1
8.7
7.6
Ore grade milled - Zinc (%)
4.1
4.2
3.9
3.6
3.3
3.9
3.4
Silver produced (oz.)
1,224,199
1,074,230
1,226,477
887,858
955,401
4,412,764
3,564,128
Lead produced (tons)
7,934
7,172
8,147
5,980
6,131
29,233
23,137
Zinc produced (tons)
3,335
3,279
3,370
2,452
2,296
12,436
9,969
Sales
$
45,434
$
28,460
$
35,880
$
38,040
$
32,938
$
147,814
$
131,488
Total cost of sales
$
(32,819
)
$
(24,166
)
$
(30,348
)
$
(29,265
)
$
(23,252
)
$
(116,598
)
$
(97,538
)
Gross profit
$
12,615
$
4,294
$
5,532
$
8,775
$
9,686
$
31,216
$
33,950
Cash flow from operations
$
(7,437
)
$
11,624
$
21,861
$
11,765
$
16,953
$
37,813
$
62,594
Capital additions
$
(13,714
)
$
(16,125
)
$
(11,501
)
$
(9,652
)
$
(9,109
)
$
(50,992
)
$
(29,885
)
Free cash flow2
$
(21,151
)
$
(4,501
)
$
10,360
$
2,113
$
7,844
$
(13,179
)
$
32,709
Cash cost per ounce, after by-product
credits3
$
5.81
$
5.23
$
3.07
$
6.57
$
4.50
$
5.06
$
6.60
AISC per ounce, after by-product
credits4
$
12.88
$
15.98
$
9.91
$
13.15
$
12.54
$
12.86
$
14.34
Lucky Friday produced 4.4 million ounces of silver, an increase
of 24% over the prior year due to record throughput, and higher
mined grades. Silver production for the fourth quarter was 1.2
million ounces, an increase of 14% over the prior quarter due to
higher grades mined.
Fourth quarter sales were $45.4 million, an increase of $17.0
million over the prior quarter due to increased production, higher
realized prices, and the sale of the silver concentrate shipment
which was deferred from the third quarter. Cost of sales were $32.8
million and increased $8.7 million over the prior quarter due to
costs associated with the deferred silver concentrate shipment
inventoried in the third quarter, and higher labor costs as the
mine continued to fill key positions. Cash costs after by-product
credits per silver ounce were $5.81 and increased over the prior
quarter due to higher labor costs and higher treatment and freight
costs resulting from higher concentrate sales, partially offset by
higher by-product credits and higher silver production. AISC after
by-product credits per silver ounce was $12.88 and decreased over
the prior quarter as the factors affecting cash cost per ounce were
offset by lower capital spend in the fourth quarter.3,4 Cash flow
from operations was negative $7.4 million, a decrease of $19.1
million over the prior quarter due to unfavorable working capital
changes and receipt of $6.7 million related to the deferred silver
concentrate shipment received in January 2023. Free cash flow was
negative $21.2 million and decreased over the prior quarter
primarily due to decreased cash flow from operations partially
offset by lower capital spend.2
2022 sales were $147.8 million, an increase of $16.3 million
over 2021 as higher metal production offset lower realized prices
and higher treatment costs due to increased concentrate production.
Cost of sales increased to $116.6 million compared to $97.5 million
in 2021 reflecting higher costs related to increased tons mined and
milled, as well as inflationary pressures for fuel, reagents and
other input costs realized during the year. Cash costs and AISC per
silver ounce, each after by-product credits, were $5.06 and $12.86,
respectively, decreasing year over year due to higher production
and by-product credits partially offset by higher costs and capital
spend. 3,4 Cash flow from operations for the year was $37.8
million, a decrease of $24.8 million over the prior year due to
higher production costs and unfavorable working capital changes.
Free cash flow was negative $13.2 million due to lower cash flow
from operations and increased capital spend for the year.2
Casa Berardi - Quebec
Dollars are in thousands except cost per
ton
4Q-2022
3Q-2022
2Q-2022
1Q-2022
4Q-2021
FY 2022
FY 2021
CASA BERARDI
Tons of ore processed - underground
160,150
162,215
176,576
161,609
161,355
660,550
694,617
Tons of ore processed - surface pit
250,883
227,726
225,042
224,541
225,662
928,189
833,629
Tons of ore processed - total
411,033
389,941
401,618
386,150
387,017
1,588,739
1,528,246
Surface tons mined - ore and waste
2,657,638
2,822,906
2,149,412
1,892,339
1,507,457
9,522,295
7,015,178
Total production cost per ton
$
125.75
$
114.52
$
113.07
$
117.96
$
108.82
$
117.89
$
98.60
Ore grade milled - Gold (oz./ton) -
underground
0.15
0.15
0.19
0.14
0.17
0.16
0.16
Ore grade milled - Gold (oz./ton) -
surface pit
0.05
0.06
0.05
0.05
0.07
0.05
0.06
Ore grade milled - Gold (oz./ton) -
combined
0.09
0.10
0.10
0.09
0.11
0.09
0.10
Gold produced (oz.) - underground
20,365
22,181
22,866
19,374
22,910
84,786
98,090
Gold produced (oz.) - surface pit
10,344
11,154
10,440
10,866
14,356
42,804
36,421
Gold produced (oz.) - total
30,709
33,335
33,306
30,240
37,266
127,590
134,511
Silver produced (oz.) - total
5,960
6,882
8,379
7,068
7,967
28,289
33,571
Sales
$
53,458
$
56,939
$
62,639
$
62,101
$
60,054
$
235,136
$
245,152
Total cost of sales
$
(65,328
)
$
(59,532
)
$
(61,870
)
$
(62,168
)
$
(57,069
)
$
(248,898
)
$
(229,829
)
Gross profit (loss)
$
(11,870
)
$
(2,593
)
$
769
$
(67
)
$
2,985
$
(13,762
)
$
15,323
Cash flow from operations
$
10,188
$
8,721
$
7,417
$
8,089
$
10,029
$
34,415
$
73,791
Exploration
$
1,637
$
2,624
$
1,341
$
2,635
$
2,124
$
8,237
$
9,526
Capital additions
$
(12,995
)
$
(10,771
)
$
(8,093
)
$
(7,808
)
$
(9,537
)
$
(39,667
)
$
(49,617
)
Free cash flow2
$
(1,170
)
$
574
$
665
$
2,916
$
2,616
$
2,985
$
33,700
Cash cost per ounce, after by-product
credits3
$
1,696
$
1,349
$
1,371
$
1,516
$
1,137
$
1,478
$
1,125
AISC per ounce, after by-product
credits4
$
2,132
$
1,738
$
1,641
$
1,810
$
1,470
$
1,825
$
1,399
Casa Berardi produced 127,590 and 30,709 ounces of gold in 2022
and the fourth quarter, respectively. Gold production for the year
decreased by 5% compared to last year due to a 12% decrease in
overall gold grade, partially offset by a 4% increase in tonnage
and a 3% increase in mill recoveries. The lower grade was due to a
higher ratio of lower grade ore sourced from the open pits. The
mill continued to perform well, achieving record throughput of
4,468 tons per day (tpd) in the fourth quarter of 2022.
Full year 2022 cost of sales was $248.9 million, an increase of
$19.1 million over the prior year due to inflationary pressures and
increased labor, consumables, and contractor costs. Cash costs and
AISC per ounce, each after by-product credits, were $1,478 and
$1,825, respectively.3,4 The year over year increase in cash costs
and AISC per gold ounce was due to higher production costs and
lower gold production in 2022, and AISC per ounce was also impacted
by higher sustaining capital and higher exploration
spending.3,4
Cash flow from operations for the year was $34.4 million and
decreased year over year due a combination of lower production and
higher operating costs. Free cash flow for the year was $3.0
million compared to $33.7 million in 2021.2
Keno Hill - Yukon Territory
At Keno Hill, production is expected to commence in the third
quarter 2023 with a phased ramp up projected to reach 440 tpd by
the end of the year. Anticipated silver production for the year is
2.5-3 million ounces expected from the Bermingham and Flame &
Moth deposits. As of the end of January 2023, approximately 40% of
development required to achieve full production was completed.
Capital spending to bring the mine to full production is estimated
to be $35-$40 million in 2023. Some key capital projects underway
include camp expansion, mill improvements and engineering, and
other surface capital infrastructure projects.
EXPLORATION AND PRE-DEVELOPMENT
Exploration and pre-development expenses totaled $6.9 million
for the fourth quarter and $46.0 million for the full year.
Exploration activities during the fourth quarter focused on targets
at Keno Hill, Casa Berardi, and Greens Creek.
For the year ended 2022, the Company reported the highest silver
reserves of more than 240 million ounces, an increase of 21% over
2021. The increase was primarily due to the acquisition of Keno
Hill in Canada's Yukon territory. Gold reserves declined 6% to 2.6
million ounces compared to 2021 due to cost increases which
increased the cut-off grade at Casa Berardi. A breakdown of the
Company's reserves and resources is located in Table A at the end
of this news release.
For further details on Company's 2022 exploration and
pre-development program and 2023 planned expenditures as well as
reserves and resources at year-end 2022, please refer to the news
release entitled "Hecla Reports Highest Silver Reserves in Company
History" released on February 14, 2023.
2023 ESTIMATES6
The Company is providing a three-year production outlook and
2023 estimates of costs, capital and exploration and
pre-development expenses.
2023 - 2025 Production Outlook
Production guidance for 2023-2025 includes expected production
from Keno Hill. Consolidated silver production is expected to
increase over the three years to reach 18.5-20 million ounces by
2025. Consolidated gold production is expected to decrease to
160-170 thousand ounces in 2023 primarily due to Casa Berardi as an
increase in the underground cut-off grade will lower gold
production and reduce lower margin material and lower contractor
costs.
Casa Berardi's production is expected to be lower in the first
half of 2023 and increase in the latter half of the year. Cash
costs and AISC, each after by-product credits, per gold ounce are
expected to be higher in the first half and trend lower in the
second half of the year.
Silver
Production
(Moz)
Gold
Production
(Koz)
Silver
Equivalent
(Moz)
Gold
Equivalent
(Koz)
2023 Greens Creek *
9.0 - 9.5
50.0 - 55.0
21.0 - 22.0
255.0 - 265.0
2023 Lucky Friday *
4.5 - 5.0
N/A
8.5 - 9.0
105.0 - 110.0
2023 Casa Berardi
N/A
110.0 - 115.0
9.0 - 9.5
110.0 - 115.0
2023 Keno Hill
2.5 - 3.0
N/A
2.5 - 3.0
35.0 - 40.0
2023 Total
16.0 - 17.5
160.0 - 170.0
41.5 - 44.0
505.0 - 535.0
2024 Total
17.5 - 18.5
145.0 - 161.0
42.5 - 44.5
510.0 - 540.0
2025 Total
18.5 - 20.0
142.0 - 161.5
41.0 - 44.0
495.0 - 535.0
*Equivalent ounces include lead and zinc production
2023 Cost Outlook
Costs of Sales
(million)
Cash cost, after by-
product credits,
per silver/gold ounce3
AISC, after by-
product credits,
per produced
silver/gold ounce4
Greens Creek
245
$0.00 - $0.25
$6.00 - $6.75
Lucky Friday
128
$2.00 - $2.50
$8.50 - $9.50
Keno Hill
40
$11.00 - $13.50
$12.25 - $14.75
Total Silver
413
$2.50 - $3.00
$10.25 - $11.50
Casa Berardi
220
$1450 - $1550
$1975 - $2050
2023 Capital and Exploration Outlook
Capital spending in 2023 is expected to increase due to higher
spending at Casa Berardi and Greens Creek, as well as development
and infrastructure projects at Keno Hill. Casa Berardi's increased
capital spending is primarily due to the expansion of tailings
facility. Greens Creek's projected higher capital spend is due to
additional equipment purchases as the mine targets throughput of
2,600 tons per day, and increased capital development.
Capital expenditures
$190 - $200 million
Greens Creek
$49 - $52 million
Lucky Friday
$48 - $51 million
Casa Berardi
$51 - $53 million
Keno Hill
$42 - $44 million
Exploration and Pre-development
expenditures
$32.5 million
Keno Hill Ramp Up Costs
$9.0 million
DIVIDENDS
Common Stock
The Board of Directors declared a quarterly cash dividend of
$0.00625 per share of common stock, consisting of $0.00375 per
share for the minimum dividend component and $0.0025 per share for
the silver-linked component. The common stock dividend is payable
on or about March 24, 2023, to stockholders of record on March 9,
2023. The realized silver price was $22.03 in the fourth quarter,
satisfying the criterion for the silver-linked component under the
Company's common stock dividend policy.
Preferred Stock
The Board of Directors elected to declare a quarterly cash
dividend of $0.875 per share of preferred stock, payable on or
about April 3, 2023, to stockholders of record on March 15,
2023.
CONFERENCE CALL AND WEBCAST
A conference call and webcast will be held Wednesday, February
15, at 10:00 a.m. Eastern Time to discuss these results. We
recommend that you dial in at least 10 minutes before the call
commencement. You may join the conference call by dialing toll-free
1-888-330-2391 or for international dialing 1-240-789-2702. The
Conference ID is 4812168 and must be provided when dialing in.
Hecla's live and archived webcast can be accessed at
https://events.q4inc.com/attendee/180188973 or www.hecla-mining.com
under Investors.
VIRTUAL INVESTOR EVENT
Hecla will be holding a Virtual Investor Event on Wednesday,
February 15, from 12:00 p.m. to 2:00 p.m. Eastern Time.
Hecla invites shareholders, investors, and other interested
parties to schedule a personal, 30-minute virtual meeting (video or
telephone) with a member of senior management to discuss
Financials, Exploration, Operations, ESG or general matters. Click
on the link below to schedule a call (or copy and paste the link
into your web browser). You can select a topic once you have
entered the meeting calendar. If you are unable to book a time,
either due to high demand or for other reasons, please reach out to
Anvita M. Patil, Vice President, Investor Relations and Treasurer
at hmc-info@hecla-mining.com or 208-769-4100.
One-on-One meeting URL:
https://calendly.com/2023-february-vie
ABOUT HECLA
Founded in 1891, Hecla Mining Company (NYSE: HL) is the largest
silver producer in the United States. In addition to operating
mines in Alaska, Idaho, and Quebec, Canada, the Company is
developing a mine in the Yukon, Canada, and owns a number of
exploration and pre-development projects in world-class silver and
gold mining districts throughout North America.
NOTES
Non-GAAP Financial Measures
Non-GAAP financial measures are intended to provide additional
information only and do not have any standard meaning prescribed by
United States generally accepted accounting principles (GAAP).
These measures should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
GAAP. The non-GAAP financial measures cited in this release and
listed below are reconciled to their most comparable GAAP measure
at the end of this release.
(1) Adjusted EBITDA is a non-GAAP measurement, a reconciliation
of which to net income, the most comparable GAAP measure, can be
found at the end of the release. Adjusted EBITDA is a measure used
by management to evaluate the Company's operating performance but
should not be considered an alternative to net income, or cash
provided by operating activities as those terms are defined by
GAAP, and does not necessarily indicate whether cash flows will be
sufficient to fund cash needs. In addition, the Company may use it
when formulating performance goals and targets under its incentive
program. Net debt to adjusted EBITDA is a non-GAAP measurement, a
reconciliation of which to debt and net income (loss), the most
comparable GAAP measurements, can be found at the end of the
release. It is an important measure for management to measure
relative indebtedness and the ability to service the debt relative
to its peers. It is calculated as total debt outstanding less total
cash on hand divided by adjusted EBITDA.
(2) Free cash flow is a non-GAAP measure calculated as cash
provided by operating activities less additions to properties,
plants and equipment. Cash provided by operating activities for the
Greens Creek, Lucky Friday, Casa Berardi, and Nevada operating
segments excludes exploration and pre-development expense, as it is
a discretionary expenditure and not a component of the mines’
operating performance.
(3) Cash cost, after by-product credits, per silver and gold
ounce is a non-GAAP measurement, a reconciliation of which to cost
of sales and other direct production costs and depreciation,
depletion and amortization (sometimes referred to as "cost of
sales" in this release), can be found at the end of the release. It
is an important operating statistic that management utilizes to
measure each mine's operating performance. It also allows the
benchmarking of performance of each mine versus those of our
competitors. As a primary silver mining company, management also
uses the statistic on an aggregate basis - aggregating the Greens
Creek and Lucky Friday mines - to compare performance with that of
other silver mining companies, and aggregating Casa Berardi and the
Nevada operations, to compare its performance with other gold
mining companies. Similarly, the statistic is useful in identifying
acquisition and investment opportunities as it provides a common
tool for measuring the financial performance of other mines with
varying geologic, metallurgical and operating characteristics. In
addition, the Company may use it when formulating performance goals
and targets under its incentive program. Cash cost, after
by-product credits, per silver ounce is not presented for Lucky
Friday for the first nine-months of 2020, as production was limited
due to the strike and subsequent ramp-up and results are not
comparable to those from prior periods and are not indicative of
future operating results under full production.
(4) All-in sustaining cost (AISC), after by-product credits, is
a non-GAAP measurement, a reconciliation of which to cost of sales
and other direct production costs and depreciation, depletion and
amortization, the closest GAAP measurement, can be found in the end
of the release. AISC, after by-product credits, includes cost of
sales and other direct production costs, expenses for reclamation
and exploration at the mines sites, corporate exploration related
to sustaining operations, and all site sustaining capital costs.
AISC, after by-product credits, is calculated net of depreciation,
depletion, and amortization and by-product credits.
(5) Adjusted net income (loss) applicable to common stockholders
is a non-GAAP measurement, a reconciliation of which to net income
(loss) applicable to common stockholders, the most comparable GAAP
measure, can be found at the end of the release. Adjusted net
income (loss) is a measure used by management to evaluate the
Company's operating performance but should not be considered an
alternative to net income (loss) as defined by GAAP. They exclude
certain impacts which are of a nature which we believe are not
reflective of our underlying performance. Management believes that
adjusted net income (loss) per common share provides investors with
the ability to better evaluate our underlying operating
performance.
Current GAAP measures used in the mining industry, such as cost
of goods sold, do not capture all the expenditures incurred to
discover, develop and sustain silver and gold production.
Management believes that all-in sustaining costs is a non-GAAP
measure that provides additional information to management,
investors and analysts to help (i) in the understanding of the
economics of our operations and performance compared to other
producers and (ii) in the transparency by better defining the total
costs associated with production. Similarly, the statistic is
useful in identifying acquisition and investment opportunities as
it provides a common tool for measuring the financial performance
of other mines with varying geologic, metallurgical and operating
characteristics. In addition, the Company may use it when
formulating performance goals and targets under its incentive
program.
Other
(6) Expectations for 2023 include silver, gold, lead and zinc
production from Greens Creek, Lucky Friday, Keno Hill, and Casa
Berardi converted using Au $1,800/oz, Ag $22/oz, Zn $1.15/lb, and
Pb 0.90$/lb, CAD/USD 1.30. Numbers may be rounded.
Cautionary Statement Regarding
Forward-Looking Statements, Including 2023 Outlook
This news release 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
created by such sections and other applicable laws, including
Canadian securities laws. Words such as “may”, “will”, “should”,
“expects”, “intends”, “projects”, “believes”, “estimates”,
“targets”, “anticipates” and similar expressions are used to
identify these forward-looking statements. Such forward-looking
statements may include, without limitation: (i) increased demand
for silver due to transition to clean energy; (ii) Keno Hill will
be in production in the second half of the year with ramp-up to 440
tons per day by the end of 2023; (iii) the Company will set new
production records in 2023 and 2024; (iv) Casa Berardi's costs will
trend lower in the second half of 2023; and; (v) mine-specific and
Company-wide 2023 estimates of future production (for 2024 and
2025), sales and costs of sales, as well as cash cost and AISC per
ounce (in each case after by-product credits) and Company-wide
estimated spending on capital, exploration and pre-development for
2023. The material factors or assumptions used to develop such
forward-looking statements or forward-looking information include
that the Company’s plans for development and production will
proceed as expected and will not require revision as a result of
risks or uncertainties, whether known, unknown or unanticipated, to
which the Company’s operations are subject.
Estimates or expectations of future events or results are based
upon certain assumptions, which may prove to be incorrect, which
could cause actual results to differ from forward-looking
statements. Such assumptions, include, but are not limited to: (i)
there being no significant change to current geotechnical,
metallurgical, hydrological and other physical conditions; (ii)
permitting, development, operations and expansion of the Company’s
projects being consistent with current expectations and mine plans;
(iii) political/regulatory developments in any jurisdiction in
which the Company operates being consistent with its current
expectations; (iv) the exchange rate for the USD/CAD and USD/MXN,
being approximately consistent with current levels; (v) certain
price assumptions for gold, silver, lead and zinc; (vi) prices for
key supplies being approximately consistent with current levels;
(vii) the accuracy of our current mineral reserve and mineral
resource estimates; (viii) there being no significant changes to
Company plans for 2023 and beyond due to COVID-19 or any other
public health issue, including, but not limited to with respect to
availability of employees, vendors and equipment; (ix) the
Company’s plans for development and production will proceed as
expected and will not require revision as a result of risks or
uncertainties, whether known, unknown or unanticipated; (x)
counterparties performing their obligations under hedging
instruments and put option contracts; (xi) sufficient workforce is
available and trained to perform assigned tasks; (xii) weather
patterns and rain/snowfall within normal seasonal ranges so as not
to impact operations; (xiii) relations with interested parties,
including First Nations and Native Americans, remain productive;
(xiv) maintaining availability of water rights; (xv) factors do not
arise that reduce available cash balances; and (xvi) there being no
material increases in our current requirements to post or maintain
reclamation and performance bonds or collateral related
thereto.
In addition, material risks that could cause actual results to
differ from forward-looking statements include, but are not limited
to: (i) gold, silver and other metals price volatility; (ii)
operating risks; (iii) currency fluctuations; (iv) increased
production costs and variances in ore grade or recovery rates from
those assumed in mining plans; (v) community relations; (vi)
conflict resolution and outcome of projects or oppositions; (vii)
litigation, political, regulatory, labor and environmental risks;
(viii) exploration risks and results, including that mineral
resources are not mineral reserves, they do not have demonstrated
economic viability and there is no certainty that they can be
upgraded to mineral reserves through continued exploration; (ix)
the failure of counterparties to perform their obligations under
hedging instruments; (x) we take a material impairment charge on
any of our assets; and (xi) inflation causes our costs to rise more
than we currently expect. For a more detailed discussion of such
risks and other factors, see the Company’s (i) 2021 Annual Report
on Form 10-K, filed with the Securities and Exchange Commission
(SEC) on February 23, 2022, and (ii) other SEC filings, including
its Quarterly Report on Form 10-Q filed with the SEC on August 5,
2022 and 2022 Form 10-K expected to be filed with the SEC by March
1, 2023. The Company does not undertake any obligation to release
publicly, revisions to any “forward-looking statement,” including,
without limitation, outlook, to reflect events or circumstances
after the date of this presentation, or to reflect the occurrence
of unanticipated events, except as may be required under applicable
securities laws. Investors should not assume that any lack of
update to a previously issued “forward-looking statement”
constitutes a reaffirmation of that statement. Continued reliance
on “forward-looking statements” is at investors’ own risk.
Qualified Person (QP)
Kurt D. Allen, MSc., CPG, VP - Exploration of Hecla Mining
Company and Keith Blair, MSc., CPG, Chief Geologist of Hecla
Limited, who serve as a Qualified Person under S-K 1300 and NI
43-101, supervised the preparation of the scientific and technical
information concerning Hecla’s mineral projects in this news
release. Technical Report Summaries (each a “TRS”) for each of the
Company’s material properties are filed as exhibits 96.1, 96.2 and
96.3 to the Company’s Form 10-K for the year ended December 31,
2022 and are incorporated by reference into the Company’s Form
10-K, expected to be filed with the SEC on February 15, 2023, and
are available at www.sec.gov. Information regarding data
verification, surveys and investigations, quality assurance program
and quality control measures and a summary of analytical or testing
procedures for (i) the Greens Creek Mine are contained in its TRS
and in a NI 43-101 technical report titled “Technical Report for
the Greens Creek Mine” effective date December 31, 2018, (ii) the
Lucky Friday Mine are contained in its TRS and in its technical
report titled “Technical Report for the Lucky Friday Mine Shoshone
County, Idaho, USA” effective date April 2, 2014, (iii) Casa
Berardi are contained in its TRS and in its technical report titled
“Technical Report on the mineral resource and mineral reserve
estimate for Casa Berardi Mine, Northwestern Quebec, Canada”
effective date December 31, 2018, and (iv) the San Sebastian Mine,
Mexico, are contained in a technical report prepared for Hecla
titled “Technical Report for the San Sebastian Ag-Au Property,
Durango, Mexico” effective date September 8, 2015. Also included in
each TRS and the four technical reports is a description of the key
assumptions, parameters and methods used to estimate mineral
reserves and resources and a general discussion of the extent to
which the estimates may be affected by any known environmental,
permitting, legal, title, taxation, socio-political, marketing, or
other relevant factors. Information regarding data verification,
surveys and investigations, quality assurance program and quality
control measures and a summary of sample, analytical or testing
procedures and the key assumptions, parameters and methods used to
estimate mineral reserves and resources and a general discussion of
the extent to which the estimates may be affected by any known
environmental, permitting, legal, title, taxation, socio-political,
marketing, or other relevant factors are contained in technical
reports prepared for Alexco Resource Corp. (“Alexco”) for Keno Hill
(technical report dated April 1, 2021) and for Klondex Mines Ltd.
for (i) the Fire Creek Mine (technical report dated March 31,
2018), (ii) the Hollister Mine (technical report dated May 31,
2017, amended August 9, 2017), and (iii) the Midas Mine (technical
report dated August 31, 2014, amended April 2, 2015). Copies of
these technical reports are available under Hecla’s profile on
SEDAR, and in the case of Keno Hill, under Alexco’s profile, each
at www.sedar.com. Mr. Allen and Mr. Blair reviewed and verified
information regarding drill sampling, data verification of all
digitally collected data, drill surveys and specific gravity
determinations relating to all the mines. The review encompassed
quality assurance programs and quality control measures including
analytical or testing practice, chain-of-custody procedures, sample
storage procedures and included independent sample collection and
analysis. This review found the information and procedures meet
industry standards and are adequate for Mineral Resource and
Mineral Reserve estimation and mine planning purposes.
HECLA MINING COMPANY
Condensed Consolidated Statements
of Income (Loss)
(dollars and shares in thousands,
except per share amounts - unaudited)
Fourth Quarter Ended
Third Quarter Ended
Twelve Months Ended
December 31, 2022
September 30, 2022
December 31, 2022
December 31, 2021
Sales of products
$
194,825
$
146,339
$
718,905
$
807,473
Cost of sales and other direct production
costs
132,232
104,900
458,811
417,879
Depreciation, depletion and
amortization
37,575
32,992
143,938
171,793
Total cost of sales
169,807
137,892
602,749
589,672
Gross profit
25,018
8,447
116,156
217,801
Other operating expenses:
General and administrative
14,396
11,003
43,384
34,570
Exploration and pre-development
6,905
15,128
46,041
47,901
Other operating expense
952
902
6,262
14,327
Ramp-up and suspension costs
7,575
5,092
24,114
23,012
Provision for closed operations and
reclamation
4,639
1,781
8,793
14,571
34,467
33,906
128,594
134,381
Income (loss) from operations
(9,448
)
(25,459
)
(12,438
)
83,420
Other (expense) income:
Fair value adjustments, net
9,980
(4,240
)
(4,723
)
(35,792
)
Foreign exchange (loss) gain, net
(900
)
5,667
7,211
417
Other net expense
1,353
1,853
7,829
(574
)
Interest expense
(9,360
)
(10,874
)
(42,793
)
(41,945
)
1,073
(7,594
)
(32,476
)
(77,894
)
(Loss) income before income taxes
(8,376
)
(33,053
)
(44,914
)
5,526
Income and mining tax benefit
(provision)
3,924
9,527
7,566
29,569
Net income (loss)
(4,452
)
(23,526
)
(37,348
)
35,095
Preferred stock dividends
(138
)
(138
)
(552
)
(552
)
Income (loss) applicable to common
stockholders
$
(4,590
)
$
(23,664
)
$
(37,900
)
$
34,543
Basic income (loss) per common share after
preferred dividends (in cents)
$
(0.01
)
$
(0.04
)
$
(0.07
)
$
0.06
Diluted income (loss) per common share
after preferred dividends (in cents)
$
(0.01
)
$
(0.04
)
$
(0.07
)
$
0.06
Weighted average number of common shares
outstanding basic
596,959
554,531
557,344
536,192
Weighted average number of common shares
outstanding diluted
596,959
554,531
557,344
542,176
HECLA MINING COMPANY
Condensed Consolidated Balance
Sheets
(dollars and shares in thousands
- unaudited)
December 31, 2022
December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents
$
104,743
$
210,010
Accounts receivable
55,841
44,586
Inventories
90,672
67,765
Other current assets
16,471
19,266
Total current assets
267,727
341,627
Investments
24,018
10,844
Restricted cash and investments
1,164
1,053
Properties, plants, equipment and mineral
interests, net
2,569,790
2,310,810
Operating lease right-of-use assets
11,064
12,435
Deferred tax assets
21,105
45,562
Other non-current assets
32,304
6,477
Total assets
$
2,927,172
$
2,728,808
LIABILITIES
Current liabilities:
Accounts payable and accrued
liabilities
$
84,747
$
68,100
Accrued payroll and related benefits
37,579
28,714
Accrued taxes
4,030
12,306
Finance leases
9,483
5,612
Accrued reclamation and closure costs
8,591
9,259
Accrued interest
14,454
14,454
Derivatives liabilities
16,125
19,353
Other current liabilities
3,457
2,585
Total current liabilities
178,466
160,383
Long-term debt including finance
leases
517,742
515,871
Accrued reclamation and closure costs
108,408
103,972
Deferred income tax liability
125,846
149,706
Non-current pension liability
—
4,673
Derivatives liabilities
6,066
18,528
Other non-current liabilities
11,677
14,888
Total liabilities
948,205
968,021
STOCKHOLDERS’ EQUITY
Preferred stock
39
39
Common stock
151,819
136,391
Capital surplus
2,260,290
2,034,485
Accumulated deficit
(403,931
)
(353,651
)
Accumulated other comprehensive (loss)
2,448
(28,456
)
Treasury stock
(31,698
)
(28,021
)
Total stockholders’ equity
1,978,967
1,760,787
Total liabilities and stockholders’
equity
$
2,927,172
$
2,728,808
Common shares outstanding
607,620
545,535
HECLA MINING COMPANY
Condensed Consolidated Statements
of Cash Flows
(dollars in thousands -
unaudited)
Fourth Quarter Ended
Third Quarter Ended
Twelve Months Ended
December 31, 2022
September 30, 2022
December 31, 2022
December 31, 2021
OPERATING ACTIVITIES
Net income (loss)
$
(4,452
)
$
(23,526
)
$
(37,348
)
$
35,095
Non-cash elements included in net income
(loss):
Depreciation, depletion and
amortization
38,404
33,087
145,147
172,651
Provision for reclamation and closure
costs
4,783
1,518
9,572
11,514
Deferred income taxes
(8,395
)
(16,538
)
(26,223
)
(48,049
)
Stock compensation
1,714
1,773
6,012
6,082
Fair value adjustments, net
20,696
17,671
24,182
15,040
Foreign exchange (gain) loss
(857
)
(4,911
)
(9,210
)
(79
)
Adjustment of inventory to net realizable
value
487
1,405
2,646
6,524
Other non-cash charges, net
1,282
1,472
3,736
2,663
Change in assets and liabilities:
Accounts receivable
(26,119
)
15,589
8,669
(5,405
)
Inventories
1,242
(11,120
)
(18,230
)
16,919
Other current and non-current assets
(8,291
)
(2,526
)
(11,711
)
(1,678
)
Accounts payable and accrued
liabilities
(3,273
)
(38,827
)
(24,981
)
(795
)
Accrued payroll and related benefits
12,053
1,401
13,732
1,270
Accrued taxes
(5,275
)
3,031
(7,927
)
6,457
Accrued reclamation and closure costs and
other non-current liabilities
12,121
(3,821
)
11,824
2,128
Cash provided by operating
activities
36,120
(24,322
)
89,890
220,337
INVESTING ACTIVITIES
Additions to properties, plants, equipment
and mineral interests
(56,140
)
(37,430
)
(149,378
)
(109,048
)
Acquisition, net
—
8,952
8,953
—
Pre-acquisition advance to Alexco
—
(25,000
)
(25,000
)
—
Changes in restricted cash and investment
balances
(2,010
)
2,011
—
—
Purchase of carbon credits
—
—
—
(869
)
Proceeds from sale or exchange of
investments
—
6,888
9,375
1,811
Proceeds from disposition of properties,
plants, equipment and mineral interests
—
18
748
1,077
Purchases of investments
(1,431
)
(8,641
)
(31,971
)
—
Net cash used in investing
activities
(59,581
)
(53,202
)
(187,273
)
(107,029
)
FINANCING ACTIVITIES
Acquisition of treasury shares
—
—
(3,677
)
(4,525
)
Proceeds from issuance of stock, net of
related costs
12,735
4,542
17,278
—
Dividends paid to common and preferred
stockholders
(2,383
)
(3,522
)
(12,932
)
(20,672
)
Borrowings on debt
—
25,000
25,000
—
Payments on debt
(25,000
)
—
(25,000
)
—
Debt issuance and loan origination fees
paid
(19
)
(443
)
(536
)
(116
)
Repayments of capital leases
(2,411
)
(1,889
)
(7,633
)
(7,285
)
Net cash used in financing
activities
(17,078
)
23,688
(7,500
)
(32,598
)
Effect of exchange rates on cash
531
517
(273
)
(530
)
Net (decrease) increase in cash, cash
equivalents and restricted cash and cash equivalents
(40,008
)
(53,319
)
(105,156
)
80,180
Cash, cash equivalents and restricted cash
and cash equivalents at beginning of period
145,915
199,234
211,063
130,883
Cash, cash equivalents and restricted cash
and cash equivalents at end of period
$
105,907
$
145,915
$
105,907
$
211,063
Non-GAAP Measures (Unaudited)
Reconciliation of Cost of Sales and Other Direct Production
Costs and Depreciation, Depletion and Amortization (GAAP) to Cash
Cost, Before By-product Credits and Cash Cost, After By-product
Credits (non-GAAP) and All-In Sustaining Cost, Before By-product
Credits and All-In Sustaining Cost, After By-product Credits
(non-GAAP)
The tables below present reconciliations between the most
comparable GAAP measure of cost of sales and other direct
production costs and depreciation, depletion and amortization to
the non-GAAP measures of (i) Cash Cost, Before By-product Credits,
(ii) Cash Cost, After By-product Credits, (iii) AISC, Before
By-product Credits and (iv) AISC, After By-product Credits for our
operations at Greens Creek, Lucky Friday, Casa Berardi and Nevada
Operations and for the Company for the three- and twelve-month
periods ended December 31, 2022 and 2021, and for estimated amounts
for the twelve months ended December 31, 2023.
Cash Cost, After By-product Credits, per Ounce is a measure
developed by precious metals companies (including the Silver
Institute) in an effort to provide a uniform standard for
comparison purposes. There can be no assurance, however, that these
non-GAAP measures as we report them are the same as those reported
by other mining companies.
Cash Cost, After By-product Credits, per Ounce is an important
operating statistic that we utilize to measure each mine's
operating performance. We have recently started reporting AISC,
After By-product Credits, per Ounce which we use as a measure of
our operation's net cash flow after costs for exploration,
pre-development, reclamation, and sustaining capital. This is
similar to the Cash Cost, After By-product Credits, per Ounce
non-GAAP measure we report, but also includes on-site exploration,
reclamation, and sustaining capital costs. Current GAAP measures
used in the mining industry, such as cost of goods sold, do not
capture all the expenditures incurred to discover, develop and
sustain silver and gold production. Cash Cost, After By-product
Credits, per Ounce and AISC, After By-product Credits, per Ounce
also allow us to benchmark the performance of each of our
operations versus those of our competitors. As a primary silver and
gold mining company, we also use these statistics on an aggregate
basis. We aggregate Greens Creek and Lucky Friday to compare our
performance with that of other primary silver mining companies and
aggregate Casa Berardi and Nevada Operations to compare our
performance with that of other primary gold mining companies.
Similarly, these statistics are useful in identifying acquisition
and investment opportunities as they provide a common tool for
measuring the financial performance of other mines with varying
geologic, metallurgical and operating characteristics.
Cash Cost, Before By-product Credits and AISC, Before By-product
Credits include all direct and indirect operating cash costs
related directly to the physical activities of producing metals,
including mining, processing and other plant costs, third-party
refining expense, on-site general and administrative costs,
royalties and mining production taxes. AISC, Before By-product
Credits for each operation also includes on-site exploration,
reclamation, and sustaining capital costs. AISC, Before By-product
Credits for our consolidated silver properties also includes
corporate costs for general and administrative expense, exploration
and sustaining capital projects. By-product credits include
revenues earned from all metals other than the primary metal
produced at each operation. As depicted in the tables below,
by-product credits comprise an essential element of our silver unit
cost structure, distinguishing our silver operations due to the
polymetallic nature of their orebodies.
In addition to the uses described above, Cash Cost, After
By-product Credits, per Ounce and AISC, After By-product Credits,
per Ounce provide management and investors an indication of
operating cash flow, after consideration of the average price,
received from production. We also use these measurements for the
comparative monitoring of performance of our mining operations
period-to-period from a cash flow perspective. However,
comparability of Cash Cost, After By-product Credits, per Silver
Ounce and AISC, After By-product Credits, per Silver Ounce for 2022
to 2021 is impacted by, among other factors, (i) the return to full
production at Lucky Friday in the fourth quarter of 2020 and (ii)
suspension of production at San Sebastian in the fourth quarter of
2020 and discontinuation of San Sebastian being reported as an
operating segment in 2021.
The Casa Berardi and Nevada Operations sections below report
Cash Cost, After By-product Credits, per Gold Ounce and AISC, After
By-product Credits, per Gold Ounce for the production of gold,
their primary product, and by-product revenues earned from silver,
which is a by-product at Casa Berardi and Nevada Operations. Only
costs and ounces produced relating to operations with the same
primary product are combined to represent Cash Cost, After
By-product Credits, per Ounce and AISC, After By-product Credits,
per Ounce. Thus, the gold produced at Casa Berardi and Nevada
Operations is not included as a by-product credit when calculating
Cash Cost, After By-product Credits, per Silver Ounce and AISC,
After By-product Credits, per Silver Ounce for the total of Greens
Creek and Lucky Friday, our combined silver properties. Similarly,
the silver produced at our other two operations is not included as
a by-product credit when calculating the similar gold metrics for
Casa Berardi.
In thousands (except per ounce
amounts)
Three Months Ended December 31,
2022
Three Months Ended September 30,
2022
Twelve Months Ended December 31,
2022
Twelve Months Ended December 31,
2021
Greens
Creek
Lucky
Friday
Corporate
and
other(3)
Total
Silver
Greens
Creek
Lucky
Friday
Corporate
and
other(3)
Total
Silver
Greens
Creek
Lucky
Friday(2)
Corporate
and
other(3)
Total
Silver
Greens
Creek
Lucky
Friday(2)
Corporate
and
other(3)
Total
Silver
Total cost of sales
$70,074
$32,819
$0
$102,893
$52,502
$24,164
$76,666
$232,718
$116,598
$—
$349,316
$213,113
$97,538
$247
$310,898
Depreciation, depletion and
amortization
(13,557)
(9,549)
-
(23,106)
(10,305)
(7,261)
(17,566)
(48,911)
(33,704)
-
(82,615)
(48,710)
(26,846)
(152)
(75,708)
Treatment costs
10,467
5,334
-
15,801
9,477
4,791
14,268
37,836
18,605
-
56,441
36,099
16,723
-
52,822
Change in product inventory
(4,014)
(571)
-
(4,585)
4,464
3,022
7,486
5,885
2,049
-
7,934
80
(406)
-
(326)
Reclamation and other costs
499
(265)
-
234
(118)
(152)
(270)
(1,489)
(1,034)
-
(2,523)
(3,466)
(1,039)
(95)
(4,600)
Cash Cost, Before By-product
Credits(1)
63,469
27,768
-
91,237
56,020
24,564
80,584
226,039
102,514
-
328,553
197,116
85,970
-
283,086
Reclamation and other costs
706
282
988
705
282
987
2,821
1,128
-
3,949
3,390
1,056
-
4,446
Exploration
1,050
-
359
1,409
3,776
-
722
4,498
5,920
-
2,567
8,487
4,591
-
2,226
6,817
Sustaining capital
9,862
8,369
-
18,231
10,219
11,264
187
21,670
40,705
33,306
334
74,345
27,582
26,517
210
54,309
General and administrative
14,395
14,395
11,003
11,003
-
-
43,384
43,384
34,570
34,570
AISC, Before By-product Credits(1)
75,087
36,419
14,754
126,260
70,720
36,110
11,912
118,742
275,485
136,948
46,285
458,718
232,679
113,543
37,006
383,228
By-product credits:
Zinc
(26,112)
(6,249)
(32,361)
(26,244)
(7,155)
(33,399)
(113,835)
(27,607)
-
(141,442)
(100,214)
(19,479)
-
(119,693)
Gold
(19,630)
(19,630)
(17,019)
(17,019)
(75,596)
-
-
(75,596)
(72,011)
-
(72,011)
Lead
(7,351)
(14,392)
(21,743)
(6,212)
(11,796)
(18,008)
(29,800)
(52,568)
-
(82,368)
(30,922)
(42,966)
-
(73,888)
Total By-product credits
(53,093)
(20,641)
—
(73,734)
(49,475)
(18,951)
—
(68,426)
(219,231)
(80,175)
—
(299,406)
(203,147)
(62,445)
—
(265,592)
Cash Cost, After By-product Credits
$10,376
$7,127
$—
$17,503
$6,545
$5,613
$—
$12,158
$6,808
$22,339
$—
$29,147
$(6,031)
$23,525
$—
$17,494
AISC, After By-product Credits
$21,994
$15,777
$14,754
$52,526
$21,245
$17,159
$11,912
$50,316
$56,254
$56,773
$46,285
$159,312
$29,532
$51,098
$37,006
$117,636
Divided by ounces produced
2,433
1,224
3,657
2,469
1,075
3,544
9,742
4,413
14,155
9,243
3,564
12,807
Cash Cost, Before By-product Credits, per
Silver Ounce
$26.08
$22.68
$24.95
$22.69
$22.87
$22.74
$23.20
$23.23
$23.21
$21.33
$24.12
$22.11
By-product credits per ounce
(21.82)
(16.86)
(20.16)
(20.04)
(17.64)
(19.31)
(22.50)
(18.17)
(21.15)
(21.98)
(17.52)
(20.74)
Cash Cost, After By-product Credits, per
Silver Ounce
$4.26
$5.81
$4.79
$2.65
$5.23
$3.43
$0.70
$5.06
$2.06
$(0.65)
$6.60
$1.37
AISC, Before By-product Credits, per
Silver Ounce
$30.86
$29.74
$34.53
$28.65
$33.62
$33.51
$28.27
$31.03
$32.40
$25.17
$31.86
$29.93
By-product credits per ounce
(21.82)
(16.86)
(20.16)
(20.04)
(17.64)
(19.31)
(22.50)
(18.17)
(21.15)
(21.98)
(17.52)
(20.74)
AISC, After By-product Credits, per Silver
Ounce
$9.04
$12.88
$14.37
$8.61
$15.98
$14.20
$5.77
$12.86
$11.25
$3.19
$14.34
$9.19
In thousands (except per ounce amounts)
Three Months Ended
December 31, 2022
Three Months Ended
September 30, 2022
Twelve Months Ended
December 31, 2022
Twelve Months Ended
December 31, 2021
Casa
Berardi
Total Gold
Casa
Berardi
Total Gold
Casa
Berardi
Nevada and
Other(2)
Total Gold
Casa
Berardi
Nevada
Operations(2)
Total Gold
Total cost of sales
$
65,328
$
65,328
$
59,532
$
59,532
$
248,898
$
4,535
$
253,433
$
229,829
$
48,945
$
278,774
Depreciation, depletion and
amortization
(14,568
)
(14,568
)
(15,089
)
(15,089
)
(60,962
)
(361
)
(61,323
)
(80,744
)
(15,341
)
(96,085
)
Treatment costs
521
521
429
429
1,866
—
1,866
1,513
1,731
3,244
Change in product inventory
1,122
1,122
420
420
186
—
186
2,439
(10,907
)
(8,468
)
Reclamation and other costs
(196
)
(196
)
(203
)
(203
)
(819
)
—
(819
)
(841
)
300
(541
)
Exclusion of Nevada and Other costs
—
—
—
—
—
(4,174
)
(4,174
)
—
—
—
Cash Cost, Before By-product
Credits(1)
52,207
52,207
45,089
45,089
189,169
—
189,169
152,196
24,728
176,924
Reclamation and other costs
196
196
204
204
819
—
819
841
1,008
1,849
Exploration
1,741
1,741
2,314
2,314
6,627
—
6,627
5,326
—
5,326
Sustaining capital
11,438
11,438
10,457
10,457
36,883
—
36,883
30,643
511
31,154
AISC, Before By-product Credits(1)
65,582
65,582
58,064
58,064
233,498
—
233,498
189,006
26,247
215,253
By-product credits:
Silver
(124
)
(124
)
(131
)
(131
)
(610
)
—
(610
)
(839
)
(1,152
)
(1,991
)
Total By-product credits
(124
)
(124
)
(131
)
(131
)
(610
)
—
(610
)
(839
)
(1,152
)
(1,991
)
Cash Cost, After By-product Credits
$
52,083
$
52,083
$
44,958
$
44,958
$
188,559
$
—
$
188,559
$
151,357
$
23,576
$
174,933
AISC, After By-product Credits
$
65,458
$
65,458
$
57,933
$
57,933
$
232,888
$
—
$
232,888
$
188,167
$
25,095
$
213,262
Divided by gold ounces produced
31
31
33
33
128
—
128
135
21
156
Cash Cost, Before By-product Credits, per
Gold Ounce
$
1,700
$
1,700
$
1,353
$
1,353
$
1,483
$
—
$
1,483
$
1,131
$
1,193
$
1,140
By-product credits per ounce
(4
)
(4
)
(4
)
(4
)
(5
)
—
(5
)
(6
)
(56
)
(13
)
Cash Cost, After By-product Credits, per
Gold Ounce
$
1,696
$
1,696
$
1,349
$
1,349
$
1,478
$
—
$
1,478
$
1,125
$
1,137
$
1,127
AISC, Before By-product Credits, per Gold
Ounce
$
2,136
$
2,136
$
1,742
$
1,742
$
1,830
$
—
$
1,830
$
1,405
$
1,267
$
1,387
By-product credits per ounce
(4
)
(4
)
(4
)
(4
)
(5
)
—
(5
)
(6
)
(56
)
(13
)
AISC, After By-product Credits, per Gold
Ounce
$
2,132
$
2,132
$
1,738
$
1,738
$
1,825
$
—
$
1,825
$
1,399
$
1,211
$
1,374
In thousands (except per ounce amounts)
Three Months Ended
December 31, 2022
Three Months Ended
September 30, 2022
Twelve Months Ended
December 31, 2022
Twelve Months Ended
December 31, 2021
Total
Silver
Total
Gold
Total
Total
Silver
Total
Gold
Total
Total
Silver
Total
Gold
Total
Total
Silver
Total
Gold
Total
Total cost of sales
$
102,893
$
65,328
$
168,221
$
76,666
$
59,532
$
136,198
$
349,316
$
253,433
$
602,749
$
310,898
$
278,774
$
589,672
Depreciation, depletion and
amortization
(23,106
)
(14,568
)
(37,674
)
(17,566
)
(15,089
)
(32,655
)
(82,615
)
(61,323
)
(143,938
)
(75,708
)
(96,085
)
(171,793
)
Treatment costs
15,801
521
16,322
14,268
429
14,697
56,441
1,866
58,307
52,822
3,244
56,066
Change in product inventory
(4,585
)
1,122
(3,463
)
7,486
420
7,906
7,934
186
8,120
(326
)
(8,468
)
(8,794
)
Exclusion of Nevada and Other
—
—
—
—
—
—
—
(4,174
)
(4,174
)
—
—
—
Reclamation and other costs
234
(196
)
38
(270
)
(203
)
(473
)
(2,523
)
(819
)
(3,342
)
(4,600
)
(541
)
(5,141
)
Cash Cost, Before By-product
Credits(1)
91,237
52,207
143,444
80,584
45,089
125,673
328,553
189,169
517,722
283,086
176,924
460,010
Reclamation and other costs
988
196
1,184
987
204
1,191
3,949
819
4,768
4,446
1,849
6,295
Exploration
1,409
1,741
3,150
4,498
2,314
6,812
8,487
6,627
15,114
6,817
5,326
12,143
Sustaining capital
18,231
11,438
29,669
21,670
10,457
32,127
74,345
36,883
111,228
54,309
31,154
85,463
General and administrative
14,395
—
14,395
11,003
11,003
43,384
—
43,384
34,570
—
34,570
AISC, Before By-product Credits(1)
126,260
65,582
191,842
118,742
58,064
176,806
458,718
233,498
692,216
383,228
215,253
598,481
By-product credits:
Zinc
(32,361
)
—
(32,361
)
(33,399
)
—
(33,399
)
(141,442
)
—
(141,442
)
(119,693
)
—
(119,693
)
Gold
(19,630
)
—
(19,630
)
(17,019
)
—
(17,019
)
(75,596
)
—
(75,596
)
(72,011
)
—
(72,011
)
Lead
(21,743
)
—
(21,743
)
(18,008
)
—
(18,008
)
(82,368
)
—
(82,368
)
(73,888
)
—
(73,888
)
Silver
(124
)
(124
)
(131
)
(131
)
—
(610
)
(610
)
—
(1,991
)
(1,991
)
Total By-product credits
(73,734
)
(124
)
(73,858
)
(68,426
)
(131
)
(68,557
)
(299,406
)
(610
)
(300,016
)
(265,592
)
(1,991
)
(267,583
)
Cash Cost, After By-product Credits
$
17,503
$
52,083
$
69,586
$
12,158
$
44,958
$
57,116
$
29,147
$
188,559
$
217,706
$
17,494
$
174,933
$
192,427
AISC, After By-product Credits
$
52,526
$
65,458
$
117,984
$
50,316
$
57,933
$
108,249
$
159,312
$
232,888
$
392,200
$
117,636
$
213,262
$
330,898
Divided by ounces produced
3,657
31
3,544
33
14,155
128
12,807
156
Cash Cost, Before By-product Credits, per
Ounce
$
24.95
$
1,700
$
22.74
1,353
$
23.21
$
1,483
$
22.11
$
1,140
By-product credits per ounce
(20.16
)
(4
)
(19.31
)
(4
)
(21.15
)
$
(5
)
(20.74
)
(13
)
Cash Cost, After By-product Credits, per
Ounce
$
4.79
$
1,696
$
3.43
$
1,349
$
2.06
$
1,478
$
1.37
$
1,127
AISC, Before By-product Credits, per
Ounce
$
34.53
$
2,136
$
33.51
$
1,742
$
32.40
$
1,830
$
29.93
$
1,387
By-product credits per ounce
(20.16
)
(4
)
(19.31
)
(4
)
(21.15
)
$
(5
)
(20.74
)
(13
)
AISC, After By-product Credits, per
Ounce
$
14.37
2,132
$
14.20
$
1,738
$
11.24
$
1,825
$
9.19
$
1,374
In thousands (except per ounce amounts)
Three Months Ended December 31,
2021
Three Months Ended June 30,
2022
Three Months Ended March 31,
2022
Greens
Creek
Lucky
Friday
Corporate(3)
Total
Silver
Greens
Creek
Lucky
Friday
Corporate(3)
Total
Silver
Greens
Creek
Lucky
Friday
Corporate and
other(3)
Total
Silver
Cost of sales and other direct production
costs and depreciation, depletion and amortization
$
49,252
$
23,251
$
152
$
72,655
$
60,506
$
30,348
$
—
$
90,854
$
49,638
$
29,264
$
0
$
78,902
Depreciation, depletion and
amortization
(6,300
)
(6,518
)
(152
)
(12,970
)
(13,629
)
(8,862
)
—
(22,491
)
(11,420
)
(8,032
)
—
(19,452
)
Treatment costs
8,655
3,636
—
12,291
8,778
4,803
—
13,581
9,096
3,677
—
12,773
Change in product inventory
236
1,351
—
1,587
(1,102
)
503
—
(599
)
6,538
(905
)
—
5,633
Reclamation and other costs(5)
(1,689
)
(199
)
—
(1,888
)
(1,005
)
(256
)
—
(1,261
)
(850
)
(361
)
0
(1,211
)
Cash Cost, Before By-product
Credits(1)
50,154
21,521
—
71,675
53,548
26,536
—
80,084
53,002
23,643
—
76,645
Reclamation and other costs
847
264
—
1,111
705
282
—
987
705
282
—
987
Exploration
696
—
867
1,563
929
—
769
1,698
165
—
716
881
Sustaining capital
10,123
7,413
172
17,708
14,668
8,110
99
22,877
5,956
5,562
48
11,566
General and administrative(5)
—
—
6,585
6,585
—
—
9,692
9,692
—
—
8,294
8,294
AISC, Before By-product Credits(1)
61,820
29,198
7,624
98,642
69,850
34,928
10,560
115,338
59,828
29,487
9,058
98,373
By-product credits:
Zinc
(25,643
)
(5,022
)
(30,665
)
(32,828
)
(8,227
)
(41,055
)
(28,651
)
(5,977
)
(34,628
)
Gold
(15,712
)
0
(15,712
)
(20,364
)
—
(20,364
)
(18,583
)
—
(18,583
)
Lead
(7,657
)
(12,204
)
(19,861
)
(8,271
)
(14,543
)
(22,814
)
(7,966
)
(11,836
)
(19,802
)
Total By-product credits
(49,012
)
(17,226
)
—
(66,238
)
(61,463
)
(22,770
)
—
(84,233
)
(55,200
)
(17,813
)
—
(73,013
)
Cash Cost, After By-product Credits
$
1,142
$
4,295
$
—
$
5,437
$
(7,915
)
$
3,766
$
—
$
(4,149
)
$
(2,198
)
$
5,830
$
—
$
3,632
AISC, After By-product Credits
$
12,808
$
11,972
$
7,624
$
32,404
$
8,387
$
12,158
$
10,560
$
31,105
$
4,628
$
11,674
$
9,058
$
25,360
Divided by ounces produced
2,262
955
3,217
2,410
1,226
3,636
2,430
888
3,318
Cash Cost, Before By-product Credits, per
Silver Ounce
$
22.18
$
22.54
$
22.28
$
22.21
$
21.65
$
22.03
$
21.82
$
26.63
$
23.10
By-product credits per ounce
(21.68
)
(18.04
)
(20.59
)
(25.50
)
(18.58
)
(23.17
)
(22.72
)
(20.06
)
(22.01
)
Cash Cost, After By-product Credits, per
Silver Ounce
$
0.50
$
4.50
$
1.69
$
(3.29
)
$
3.07
$
(1.14
)
$
(0.90
)
$
6.57
$
1.09
AISC, Before By-product Credits, per
Silver Ounce
$
27.34
$
30.58
$
30.67
$
28.98
$
28.49
$
31.72
$
24.62
$
33.21
$
29.65
By-product credits per ounce
(21.68
)
(18.04
)
(20.59
)
(25.50
)
(18.58
)
(23.17
)
(22.72
)
(20.06
)
(22.01
)
AISC, After By-product Credits, per Silver
Ounce
$
5.66
$
12.54
$
10.08
$
3.48
$
9.91
$
8.55
$
1.90
$
13.15
$
7.64
In thousands (except per ounce amounts)
Three Months Ended December 31,
2021
Three Months Ended June 30,
2022
Three Months Ended March 31,
2022
Casa Berardi
Nevada
Operations(2)
Total Gold
Casa Berardi
Total Gold
Casa Berardi
Total Gold
Cost of sales and other direct production
costs and depreciation, depletion and amortization
$
57,069
$
2,113
$
59,182
$
61,870
$
61,870
$
62,168
$
62,168
Depreciation, depletion and
amortization
(19,585
)
(320
)
(19,905
)
(15,459
)
(15,459
)
(15,846
)
(15,846
)
Treatment costs
423
—
423
457
457
458
458
Change in product inventory
4,839
(956
)
3,883
(793
)
(793
)
(563
)
(563
)
Reclamation and other costs
(208
)
1
(207
)
(209
)
(209
)
(210
)
(210
)
Cash Cost, Before By-product
Credits(1)
42,538
838
43,376
45,866
45,866
46,007
46,007
Reclamation and other costs
209
327
536
209
209
210
210
Exploration
1,775
—
1,775
1,178
1,178
1,394
1,394
Sustaining capital
10,459
316
10,775
7,597
7,597
7,281
7,281
AISC, Before By-product Credits(1)
54,981
1,481
56,462
54,850
54,850
54,892
54,892
By-product credits:
Silver
(183
)
(21
)
(204
)
(188
)
(188
)
(166
)
(166
)
Total By-product credits
(183
)
(21
)
(204
)
(188
)
(188
)
(166
)
(166
)
Cash Cost, After By-product Credits
$
42,355
$
817
$
43,172
$
45,678
$
45,678
$
45,841
$
45,841
AISC, After By-product Credits
$
54,798
$
1,460
$
56,258
$
54,662
$
54,662
$
54,726
$
54,726
Divided by gold ounces produced
37
—
37
33
33
30
30
Cash Cost, Before By-product Credits, per
Gold Ounce
$
1,142
$
1,737
$
1,148
$
1,377
$
1,377
$
1,521
$
1,521
By-product credits per ounce
(5
)
(44
)
(5
)
(6
)
(6
)
(5
)
(5
)
Cash Cost, After By-product Credits, per
Gold Ounce
$
1,137
$
1,693
$
1,143
$
1,371
$
1,371
$
1,516
$
1,516
AISC, Before By-product Credits, per Gold
Ounce
$
1,475
$
3,073
$
1,499
$
1,647
$
1,647
$
1,815
$
1,815
By-product credits per ounce
(5
)
(44
)
(5
)
(6
)
(6
)
(5
)
(5
)
AISC, After By-product Credits, per Gold
Ounce
$
1,470
$
3,029
$
1,494
$
1,641
$
1,641
$
1,810
$
1,810
In thousands (except per ounce amounts)
Three Months Ended
December 31, 2021
Three Months Ended
June 30, 2022
Three Months Ended
March 31, 2022
Total
Silver
Total
Gold
Total
Total
Silver
Total
Gold
Total
Total
Silver
Total
Gold
Total
Cost of sales and other direct production
costs and depreciation, depletion and amortization
$
72,655
$
59,182
$
131,837
$
90,854
$
61,870
$
152,724
$
78,902
$
62,168
$
141,070
Depreciation, depletion and
amortization
(12,970
)
(19,905
)
(32,875
)
(22,491
)
(15,459
)
(37,950
)
(19,452
)
(15,846
)
(35,298
)
Treatment costs
12,291
423
12,714
13,581
457
14,038
12,773
458
13,231
Change in product inventory
1,587
3,883
5,470
(599
)
(793
)
(1,392
)
5,633
(563
)
5,070
Reclamation and other costs
(1,888
)
(207
)
(2,095
)
(1,261
)
(209
)
(1,470
)
(1,211
)
(210
)
(1,421
)
Cash Cost, Before By-product
Credits(1)
71,675
43,376
115,051
80,084
45,866
125,950
76,645
46,007
122,652
Reclamation and other costs
1,111
536
1,647
987
209
1,196
987
210
1,197
Exploration
1,563
1,775
3,338
1,698
1,178
2,876
881
1,394
2,275
Sustaining capital
17,708
10,775
28,483
22,877
7,597
30,474
11,566
7,281
18,847
General and administrative
6,585
—
6,585
9,692
9,692
8,294
—
8,294
AISC, Before By-product Credits(1)
98,642
56,462
155,104
115,338
54,850
170,188
98,373
54,892
153,265
By-product credits:
Zinc
(30,665
)
—
(30,665
)
(41,055
)
—
(41,055
)
(34,628
)
(34,628
)
Gold
(15,712
)
—
(15,712
)
(20,364
)
—
(20,364
)
(18,583
)
(18,583
)
Lead
(19,861
)
—
(19,861
)
(22,814
)
—
(22,814
)
(19,802
)
(19,802
)
Silver
(204
)
(204
)
(188
)
(188
)
(166
)
(166
)
Total By-product credits
(66,238
)
(204
)
(66,442
)
(84,233
)
(188
)
(84,421
)
(73,013
)
(166
)
(73,179
)
Cash Cost, After By-product Credits
$
5,437
$
43,172
$
48,609
$
(4,149
)
$
45,678
$
41,529
$
3,632
$
45,841
$
49,473
AISC, After By-product Credits
$
32,404
$
56,258
$
88,662
$
31,105
$
54,662
$
85,767
$
25,360
$
54,726
$
80,086
Divided by ounces produced
3,217
37
3,636
33
3,318
30
Cash Cost, Before By-product Credits, per
Ounce
$
22.28
$
1,148
$
22.03
1,377
$
23.10
$
1,521
By-product credits per ounce
(20.59
)
(5
)
(23.17
)
(6
)
(22.01
)
(5
)
Cash Cost, After By-product Credits, per
Ounce
$
1.69
$
1,143
$
(1.14
)
$
1,371
$
1.09
$
1,516
AISC, Before By-product Credits, per
Ounce
$
30.67
$
1,499
$
31.72
$
1,647
$
29.65
$
1,815
By-product credits per ounce
(20.59
)
(5
)
(23.17
)
(6
)
(22.01
)
(5
)
AISC, After By-product Credits, per
Ounce
$
10.08
$
1,494
$
8.55
$
1,641
$
7.64
$
1,810
In thousands (except per ounce amounts)
Estimate for Twelve Months Ended
December 31, 2023
Greens Creek
Lucky Friday
Keno Hill
Corporate(3)
Total Silver
Total cost of sales
$
245,000
$
128,000
$
40,000
$
413,000
Depreciation, depletion and
amortization
(46,000
)
(37,900
)
(6,800
)
(90,700
)
Treatment costs
43,700
15,375
5,150
64,225
Change in product inventory
(5,100
)
(750
)
1,000
(4,850
)
Reclamation and other costs
1,000
1,000
750
2,750
Cash Cost, Before By-product
Credits(1)
238,600
105,725
40,100
384,425
Reclamation and other costs
2,800
1,100
—
3,900
Exploration
5,900
—
2,600
2,250
10,750
Sustaining capital
48,500
30,200
550
79,250
General and administrative
—
—
—
44,000
44,000
AISC, Before By-product Credits(1)
295,800
137,025
43,250
46,250
522,325
By-product credits:
Zinc
(113,500
)
(29,900
)
(2,400
)
(145,800
)
Gold
(90,100
)
—
—
(90,100
)
Lead
(34,800
)
(64,700
)
(4,500
)
(104,000
)
Total By-product credits
(238,400
)
(94,600
)
(6,900
)
—
(339,900
)
Cash Cost, After By-product Credits
$
200
$
11,125
$
33,200
$
—
$
44,525
AISC, After By-product Credits
$
57,400
$
42,425
$
36,350
$
46,250
$
182,425
Divided by silver ounces produced
9,250
4,750
2,750
16,750
Cash Cost, Before By-product Credits, per
Silver Ounce
$
25.79
$
22.26
$
14.58
$
22.95
By-product credits per silver ounce
(25.77
)
(19.92
)
(2.51
)
(20.29
)
Cash Cost, After By-product Credits, per
Silver Ounce
$
0.02
$
2.34
$
12.07
$
2.66
AISC, Before By-product Credits, per
Silver Ounce
$
31.98
$
28.85
$
15.73
$
31.18
By-product credits per silver ounce
(25.77
)
(19.92
)
(2.51
)
(20.29
)
AISC, After By-product Credits, per Silver
Ounce
$
6.21
$
8.93
$
13.22
$
10.89
In thousands (except per ounce amounts)
Estimate for Twelve Months Ended
December 31, 2023
Casa Berardi
Total Gold
Total cost of sales
$
220,000
$
220,000
Depreciation, depletion and
amortization
(52,800
)
(52,800
)
Treatment costs
300
300
Change in product inventory
(1,300
)
(1,300
)
Reclamation and other costs
500
500
Cash Cost, Before By-product
Credits(1)
166,700
166,700
Reclamation and other costs
800
800
Exploration
5,400
5,400
Sustaining capital
52,200
52,200
AISC, Before By-product Credits(1)
225,100
225,100
By-product credits:
Silver
(600
)
(600
)
Total By-product credits
(600
)
(600
)
Cash Cost, After By-product Credits
$
166,100
$
166,100
AISC, After By-product Credits
$
224,500
$
224,500
Divided by gold ounces produced
112.5
112.5
Cash Cost, Before By-product Credits, per
Gold Ounce
$
1,482
$
1,482
By-product credits per gold ounce
(5
)
(5
)
Cash Cost, After By-product Credits, per
Gold Ounce
$
1,477
$
1,477
AISC, Before By-product Credits, per Gold
Ounce
$
2,001
$
2,001
By-product credits per gold ounce
(5
)
(5
)
AISC, After By-product Credits, per Gold
Ounce
$
1,996
$
1,996
In thousands (except per ounce
amounts)
Estimate for Twelve Months Ended
December 31, 2023
Total Silver
Total Gold
Total
Total cost of sales
$
413,000
$
220,000
$
633,000
Depreciation, depletion and
amortization
(90,700
)
(52,800
)
(143,500
)
Treatment costs
64,225
300
64,525
Change in product inventory
(4,850
)
(1,300
)
(6,150
)
Reclamation and other costs
2,750
500
3,250
Cash Cost, Before By-product
Credits(1)
384,425
166,700
551,125
Reclamation and other costs
3,900
800
4,700
Exploration
10,750
5,400
16,150
Sustaining capital
79,250
52,200
131,450
General and administrative
44,000
—
44,000
AISC, Before By-product Credits(1)
522,325
225,100
747,425
By-product credits:
Zinc
(145,800
)
—
(145,800
)
Gold
(90,100
)
—
(90,100
)
Lead
(104,000
)
—
(104,000
)
Silver
(600
)
(600
)
Total By-product credits
(339,900
)
(600
)
(340,500
)
Cash Cost, After By-product Credits
$
44,525
$
166,100
$
210,625
AISC, After By-product Credits
$
182,425
$
224,500
$
406,925
Divided by ounces produced
16,750
112.5
Cash Cost, Before By-product Credits, per
Ounce
$
22.95
$
1,482
By-product credits per ounce
(20.29
)
(5
)
Cash Cost, After By-product Credits, per
Ounce
$
2.66
$
1,477
AISC, Before By-product Credits, per
Ounce
$
31.18
$
2,001
By-product credits per ounce
(20.29
)
(5
)
AISC, After By-product Credits, per
Ounce
$
10.89
$
1,996
(1)
Includes all direct and indirect operating
costs related to the physical activities of producing metals,
including mining, processing and other plant costs, third-party
refining and marketing expense, non-discretionary on-site general
and administrative costs, royalties and mining production taxes,
before by-product revenues earned from all metals other than the
primary metal produced at each operation. AISC, Before By-product
Credits also includes on-site exploration, reclamation, and
sustaining capital costs.
(2)
Production was suspended at the Hollister
mine in the third quarter of 2019 and at the Midas mine and Aurora
mill in late 2019, and at the Midas mill and Fire Creek mine in
mid-2021. Suspension-related costs at Nevada Operations totaling
$19.7 million for 2022 and $20.4 million for 2021 are included in a
separate line item on our consolidated statements of operations and
excluded from the calculations of cost of sales and other direct
production costs and depreciation, depletion and amortization and
Cash Cost and AISC, After By-product Credits, per Gold Ounce.
(3)
AISC, Before By-product Credits for our
consolidated silver properties includes corporate costs for general
and administrative expense, exploration and sustaining capital.
Reconciliation of Net Income (Loss) (GAAP) and Debt (GAAP) to
Adjusted EBITDA (non-GAAP) and Net Debt (non-GAAP)
This release refers to the non-GAAP measures of adjusted
earnings before interest, taxes, depreciation and amortization
("Adjusted EBITDA"), which is a measure of our operating
performance, and net debt to adjusted EBITDA for the last 12 months
(or "LTM adjusted EBITDA"), which is a measure of our ability to
service our debt. Adjusted EBITDA is calculated as net income
(loss) before the following items: interest expense, income and
mining taxes, depreciation, depletion, and amortization expense,
ramp-up and suspension costs, gains and losses on disposition of
properties, plants, equipment and mineral interests, foreign
exchange gains and losses, unrealized gains and losses on
derivative contracts, interest and other income, unrealized gains
on investments, provisions for environmental matters, stock-based
compensation, provisional price gains and losses, the grant of
common shares to the Hecla Charitable Foundation, adjustments of
inventory to net realizable value. Net debt is calculated as total
debt, which consists of the liability balances for our Senior
Notes, capital leases, and other notes payable, less the total of
our cash and cash equivalents and short-term investments.
Management believes that, when presented in conjunction with
comparable GAAP measures, adjusted EBITDA and net debt to LTM
adjusted EBITDA are useful to investors in evaluating our operating
performance and ability to meet our debt obligations. The following
table reconciles net loss and debt to adjusted EBITDA and net
debt:
Dollars are in thousands
4Q-2022
3Q-2022
2Q-2022
1Q-2022
4Q-2021
FY 2022
FY 2021
Net (loss) income
$
(4,452
)
$
(23,526
)
$
(13,523
)
$
4,153
$
11,875
$
(37,348
)
$
35,095
Interest expense
11,008
10,874
10,505
10,406
10,461
42,793
41,945
Income and mining taxes
(3,924
)
(9,527
)
254
5,631
(25,645
)
(7,566
)
(29,569
)
Depreciation, depletion and
amortization
37,576
32,992
38,072
35,298
32,875
143,938
171,793
Ramp-up and suspension costs
7,575
5,092
5,242
6,205
5,998
24,114
23,012
Loss (gain) on disposition of properties,
plants, equipment, and mineral interests
19
5
(8
)
326
16
87
Foreign exchange loss (gain)
900
(5,667
)
(4,482
)
2,038
(393
)
(7,211
)
(417
)
Unrealized loss (gain) on derivative
contracts
(864
)
(873
)
689
204
25,840
(844
)
11,903
Provisional price gain
(625
)
6,625
15,807
(968
)
(5,648
)
20,839
(9,349
)
Provision for closed operations and
environmental matters
3,741
1,781
1,628
1,643
3,693
8,793
17,964
Stock-based compensation
1,714
1,773
1,254
1,271
1,307
6,012
6,081
Unrealized (gain) loss on investments
(9,121
)
5,114
15,739
(6,100
)
(2,822
)
5,632
4,295
Adjustments of inventory to net realizable
value
487
1,405
754
0
—
2,646
6,524
Monetization of zinc hedges
16,664
16,664
Other
1,582
473
(1,470
)
(1,571
)
382
(986
)
(584
)
Adjusted EBITDA
$
62,261
$
26,555
$
70,474
$
58,202
$
58,249
$
217,492
$
278,780
Total debt
$
517,742
$
515,871
Less: Cash and cash equivalents
104,743
210,010
Net debt
$
412,999
$
305,861
Net debt/LTM adjusted EBITDA
(non-GAAP)
1.9
1.1
Reconciliation of Net (Loss) Income Applicable to Common
Stockholders (GAAP) to Adjusted Net (Loss) Income Applicable to
Common Shareholders (non-GAAP)
This release refers to a non-GAAP measure of adjusted net income
(loss) applicable to common stockholders and adjusted net income
(loss) per share, which are indicators of our performance. They
exclude certain impacts which are of a nature which we believe are
not reflective of our underlying performance. Management believes
that adjusted net income (loss) per common share provides investors
with the ability to better evaluate our underlying operating
performance.
Dollars are in thousands
4Q-2022
3Q-2022
2Q-2022
1Q-2022
4Q-2021
FY 2022
FY 2021
Net (loss) income applicable to common
stockholders (GAAP)
$
(4,590
)
$
(23,664
)
$
(13,661
)
$
4,015
$
11,737
$
(37,900
)
$
34,543
Adjusted for items below:
Derivative contracts losses (gains)
(864
)
(873
)
689
204
25,840
$
(844
)
(32,655
)
Provisional pricing losses (gains)
(625
)
6,625
15,807
(968
)
(5,648
)
$
20,839
(9,349
)
Unrealized losses (gains) on equity
investments
(9,117
)
5,110
15,739
(6,100
)
(2,822
)
$
5,632
(4,295
)
Environmental accruals
2,860
—
—
14
—
$
2,874
2,882
Foreign exchange (gain) loss
900
(5,667
)
(4,482
)
2,038
(393
)
$
(7,211
)
(417
)
Ramp-up and suspension Costs
7,575
5,092
5,242
6,205
5,998
$
24,114
23,012
Loss (gain) on disposition of properties,
plants, equipment and mineral interests
—
19
5
(8
)
326
$
16
87
Adjustments of inventory to net realizable
value
487
1,405
754
—
—
$
2,646
6,524
Monetization of Zinc Hedges
16,664
—
—
—
—
$
16,664
—
Other
939
—
—
—
—
$
939
—
Adjustment income (loss) applicable to
common stockholders
$
14,229
$
(11,953
)
$
20,093
$
5,400
$
35,038
$
27,769
$
20,332
Weighted average shares – basic
596,959
554,531
539,401
538,490
538,124
557,344
536,192
Weighted average shares – diluted
596,959
554,531
539,401
544,061
543,134
557,344
542,176
Basic adjusted net income (loss) per
common stock (in cents)
0.02
(0.02
)
0.04
0.01
0.07
0.05
0.04
Diluted adjusted net income (loss) per
common stock (in cents)
0.02
(0.02
)
0.04
0.01
0.06
0.05
0.04
Reconciliation of Cash Provided by Operating Activities
(GAAP) to Free Cash Flow (non-GAAP)
This release refers to a non-GAAP measure of free cash flow,
calculated as cash provided by operating activities, less additions
to properties, plants, equipment and mineral interests. Management
believes that, when presented in conjunction with comparable GAAP
measures, free cash flow is useful to investors in evaluating our
operating performance. The following table reconciles cash provided
by operating activities to free cash flow:
Dollars are in thousands
Three Months Ended December 31,
2022
Twelve Months Ended December 31,
2022
2022
2021
2022
2021
Cash provided by operating activities
$
36,120
$
53,355
$
89,890
$
220,337
Less: Additions to properties, plants
equipment and mineral interests
$
(56,140
)
$
(28,838
)
$
(149,378
)
$
(109,048
)
Free cash flow
$
(20,020
)
$
24,517
$
(59,488
)
$
111,289
TABLE A
Mineral Reserves –
12/31/2022(1)
Proven Reserves(1)
Asset
Tons
(000)
Silver
(oz/ton)
Gold
(oz/ton)
Lead
%
Zinc
%
Silver
(000 oz)
Gold
(000 oz)
Lead
Tons
Zinc
Tons
Greens Creek(2,3)
7
16.1
0.07
2.3
5.4
108
0.4
150
360
Lucky Friday(2,4)
4,734
13.8
-
8.6
3.7
64,638
-
404,160
174,510
Casa Berardi Underground(2,5)
552
-
0.17
-
-
-
95
-
-
Casa Berardi Open Pit(2,5)
4,410
-
0.09
-
-
-
417
-
-
Keno Hill(2,6)
-
-
-
-
-
-
-
-
-
Total
9,703
64,746
512
404,310
174,870
Probable Reserves(7)
Asset
Tons
(000)
Silver
(oz/ton)
Gold
(oz/ton)
Lead
%
Zinc
%
Silver
(000 oz)
Gold
(000 oz)
Lead
(Tons)
Zinc
(Tons)
Greens Creek(2,3)
10,668
10.9
0.09
2.5
6.5
116,748
935
264,600
694,800
Lucky Friday(2,4)
840
12.8
-
8.1
3.2
9,978
-
63,510
25,030
Casa Berardi Underground(2,5)
989
-
0.17
-
-
-
166
-
-
Casa Berardi Open Pit(2,5)
12,434
-
0.08
-
-
-
936
-
-
Keno Hill(2,6)
2,197
22.5
0.01
2.4
2.2
49,473
13
52,520
49,320
Total
27,128
176,199
2,050
380,630
769,150
Proven and Probable
Reserves
Asset
Tons
(000)
Silver
(oz/ton)
Gold
(oz/ton)
Lead
%
Zinc
%
Silver
(000 oz)
Gold
(000 oz)
Lead
(Tons)
Zinc
(Tons)
Greens Creek(2,3)
10,675
10.9
0.09
2.5
6.5
116,856
935
264,750
695,160
Lucky Friday(2,4)
5,574
13.4
-
8.4
3.6
74,616
-
467,670
199,530
Casa Berardi Underground(2,5)
1,541
-
0.17
-
-
-
261
-
-
Casa Berardi Open Pit(2,5)
16,844
-
0.08
-
-
-
1,353
-
-
Keno Hill(2,6)
2,197
22.5
0.01
2.4
2.2
49,473
13
52,520
49,320
Total
36,829
240,945
2,562
784,940
944,020
(1) The term “reserve” means an estimate of tonnage and grade or
quality of indicated and measured mineral resources that, in the
opinion of the qualified person, can be the basis of an
economically viable project. More specifically, it is the
economically mineable part of a measured or indicated mineral
resource, which includes diluting materials and allowances for
losses that may occur when the material is mined or extracted. The
term “proven reserves” means the economically mineable part of a
measured mineral resource and can only result from conversion of a
measured mineral resource. See footnotes 8 and 9 below. (2) Mineral
reserves are based on $17/oz silver, $1600/oz gold, $0.90/lb lead,
$1.15/lb zinc, unless otherwise stated. All Mineral Reserves are
reported in-situ with estimates of mining dilution and mining loss.
(3) The reserve NSR cut-off values for Greens Creek are $210/ton
for all zones except the Gallagher Zone at $215/ton; metallurgical
recoveries (actual 2022): 81% for silver, 72% for gold, 82% for
lead, and 89% for zinc. (4) The reserve NSR cut-off values for
Lucky Friday are $241.34/ton for the 30 Vein and $268.67/ton for
the Intermediate Veins; metallurgical recoveries (actual 2022): 95%
for silver, 95% for lead, and 88% for zinc. (5) The average reserve
cut-off grades at Casa Berardi are 0.12 oz/ton gold underground and
0.04 oz/ton gold for open pit. Metallurgical recovery (actual
2022): 87% for gold; US$/CAN$ exchange rate: 1:1.3. (6) The reserve
NSR cut-off value at Keno Hill is $244.24/ton (CAN$350/tonne),
Metallurgical recovery: 93% for silver, 25% for gold, 93% for lead,
72% for zinc; US$/CAN$ exchange rate: 1:1.3. (7) The term “probable
reserves” means the economically mineable part of an indicated and,
in some cases, a measured mineral resource. See footnotes 9 and 10
below.
Totals may not represent the sum of parts due to rounding.
Mineral Resources –
12/31/2022(8)
Measured Resources(9)
Asset
Tons
(000)
Silver
(oz/ton)
Gold
(oz/ton)
Lead
%
Zinc
%
Copper
%
Silver
(000 oz)
Gold
(000 oz)
Lead
(Tons)
Zinc
(Tons)
Copper
(Tons)
Greens Creek(12,13)
-
-
-
-
-
-
-
-
-
-
-
Lucky Friday(12,14)
6,237
7.8
-
5.4
2.6
-
48,551
-
335,850
161,000
-
Casa Berardi Underground(12,15)
2,440
-
0.22
-
-
-
-
530
-
-
-
Casa Berardi Open Pit(12,15)
483
-
0.04
-
-
-
-
20
-
-
-
Keno Hill(12,16)
-
-
-
-
-
-
-
-
-
-
-
San Sebastian - Oxide(17)
-
-
-
-
-
-
-
-
-
-
-
San Sebastian - Sulfide(17)
-
-
-
-
-
-
-
-
-
-
-
Fire Creek(18,19)
-
-
-
-
-
-
-
-
-
-
-
Hollister(18,20)
18
4.9
0.59
-
-
-
87
10
-
-
-
Midas(18,21)
2
7.6
0.68
-
-
-
14
1
-
-
-
Heva(22)
-
-
-
-
-
-
-
-
-
-
-
Hosco(22)
-
-
-
-
-
-
-
-
-
-
-
Star(12,23)
-
-
-
-
-
-
-
-
-
-
-
Total
9,180
48,652
561
335,850
161,000
-
Indicated
Resources(10)
Asset
Tons
(000)
Silver
(oz/ton)
Gold
(oz/ton)
Lead
%
Zinc
%
Copper
%
Silver
(000 oz)
Gold
(000 oz)
Lead
(Tons)
Zinc
(Tons)
Copper
(Tons)
Greens Creek(12,13)
8,421
12.9
0.10
2.9
8.0
-
108,717
810
245,990
675,740
-
Lucky Friday(12,14)
1,194
8.0
-
5.4
2.2
-
9,581
-
64,390
26,200
-
Casa Berardi Underground(12,15)
3,870
-
0.17
-
-
-
-
660
-
-
-
Casa Berardi Open Pit(12,15)
1,323
-
0.04
-
-
-
-
48
-
-
-
Keno Hill(12,16)
4,061
8.0
0.007
1.0
4.0
-
32,288
29
39,540
163,130
-
San Sebastian - Oxide(17)
1,453
6.5
0.09
-
-
-
9,430
135
-
-
-
San Sebastian - Sulfide(17)
1,187
5.5
0.01
1.9
2.9
1.2
6,579
16
22,420
34,100
14,650
Fire Creek(18,19)
112
1.1
0.53
-
-
-
122
59
-
-
-
Hollister(18,20)
70
1.9
0.58
-
-
-
130
40
-
-
-
Midas(18,21)
76
5.7
0.42
-
-
-
430
32
-
-
-
Heva(22)
1,266
-
0.06
-
-
-
-
76
-
-
-
Hosco(22)
29,287
-
0.04
-
-
-
-
1,202
-
-
-
Star(12,23)
1,068
3.0
-
6.4
7.7
-
3,177
-
67,970
82,040
-
Total
53,388
170,454
3,107
440,310
981,210
14,650
Measured & Indicated Resources
Asset
Tons
(000)
Silver
(oz/ton)
Gold
(oz/ton)
Lead
%
Zinc
%
Copper
%
Silver
(000 oz)
Gold
(000 oz)
Lead
(Tons)
Zinc
(Tons)
Copper
(Tons)
Greens Creek(12,13)
8,421
12.9
0.10
2.9
8.0
-
108,717
810
245,990
675,740
-
Lucky Friday(12,14)
7,431
7.8
-
5.4
2.5
-
58,132
-
400,240
187,200
-
Casa Berardi Underground(12,15)
6,310
-
0.19
-
-
-
-
1,190
-
-
-
Casa Berardi Open Pit(12,15)
1,806
-
0.04
-
-
-
-
67
-
-
-
Keno Hill(12,16)
4,061
8.0
0.007
1.0
4.0
-
32,288
29
39,540
163,130
-
San Sebastian - Oxide(17)
1,453
6.5
0.09
-
-
-
9,430
135
-
-
-
San Sebastian - Sulfide(17)
1,187
5.5
0.01
1.9
2.9
1.2
6,579
16
22,420
34,100
14,650
Fire Creek(18,19)
112
1.1
0.53
-
-
-
122
59
-
-
-
Hollister(18,20)
88
2.5
0.58
-
-
-
217
51
-
-
-
Midas(18,21)
78
5.7
0.43
-
-
-
444
33
-
-
-
Heva(22)
1,266
-
0.06
-
-
-
-
76
-
-
-
Hosco(22)
29,287
-
0.04
-
-
-
-
1,202
-
-
-
Star(12,23)
1,068
3.0
-
6.4
7.7
-
3,177
-
67,970
82,040
-
Total
62,568
219,106
3,668
776,160
1,142,210
14,650
Inferred Resources(11)
Asset
Tons
(000)
Silver
(oz/ton)
Gold
(oz/ton)
Lead
%
Zinc
%
Copper
%
Silver
(000 oz)
Gold
(000 oz)
Lead
(Tons)
Zinc
(Tons)
Copper
(Tons)
Greens Creek(12,13)
2,383
12.1
0.07
2.8
6.9
-
28,949
178
67,400
164,080
-
Lucky Friday(12,14)
3,592
8.7
-
6.3
2.4
-
31,264
-
224,670
84,700
-
Casa Berardi Underground(12,15)
2,221
-
0.19
-
-
-
-
430
-
-
-
Casa Berardi Open Pit(12,15)
7,828
-
0.05
-
-
-
-
389
-
-
-
Keno Hill(12,16)
2,441
10.4
0.003
0.9
2.1
-
25,478
8
22,380
51,000
-
San Sebastian - Oxide(17)
3,490
6.4
0.05
-
-
-
22,353
182
-
-
-
San Sebastian - Sulfide(17)
385
4.2
0.01
1.6
2.3
0.9
1,606
5
6,070
8,830
3,330
Fire Creek(18,19)
765
0.5
0.51
-
-
-
394
392
-
-
-
Fire Creek - Open Pit(24)
74,584
0.1
0.03
-
-
-
5,232
2,178
-
-
-
Hollister(18,20)
642
3.0
0.42
-
-
-
1,916
273
-
-
-
Midas(18,21)
1,232
6.3
0.50
-
-
-
7,723
615
-
-
-
Heva(22)
2,787
-
0.08
-
-
-
-
216
-
-
-
Hosco(22)
17,726
-
0.04
-
-
-
-
663
-
-
-
Star(12,23)
2,851
3.1
-
5.9
5.9
-
8,795
-
168,180
166,930
-
San Juan Silver(12,25)
2,570
11.3
0.01
1.4
1.1
-
38,203
34
49,400
39,850
-
Monte Cristo(26)
913
0.3
0.14
-
-
-
271
131
-
-
-
Rock Creek(12,27)
100,086
1.5
-
-
-
0.7
148,736
-
-
-
658,680
Montanore(12,28)
112,185
1.6
-
-
-
0.7
183,346
-
-
-
759,420
Total
338,681
504,266
5,694
538,100
515,390
1,421,430
Note: All estimates are in-situ except for the proven reserves
at Greens Creek which are in surface stockpiles. Mineral resources
are exclusive of reserves.
(8) The term "mineral resources" means a
concentration or occurrence of material of economic interest in or
on the Earth's crust in such form, grade or quality, and quantity
that there are reasonable prospects for economic extraction. A
mineral resource is a reasonable estimate of mineralization, taking
into account relevant factors such as cut-off grade, likely mining
dimensions, location or continuity, that, with the assumed and
justifiable technical and economic conditions, is likely to, in
whole or in part, become economically extractable. It is not merely
an inventory of all mineralization drilled or sampled.
(9) The term "measured resources" means
that part of a mineral resource for which quantity and grade or
quality are estimated on the basis of conclusive geological
evidence and sampling. The level of geological certainty associated
with a measured mineral resource is sufficient to allow a qualified
person to apply modifying factors in sufficient detail to support
detailed mine planning and final evaluation of the economic
viability of the deposit. Because a measured mineral resource has a
higher level of confidence than the level of confidence of either
an indicated mineral resource or an inferred mineral resource, a
measured mineral resource may be converted to a proven mineral
reserve or to a probable mineral reserve.
(10) The term "indicated resources" means
that part of a mineral resource for which quantity and grade or
quality are estimated on the basis of adequate geological evidence
and sampling. The level of geological certainty associated with an
indicated mineral resource is sufficient to allow a qualified
person to apply modifying factors in sufficient detail to support
mine planning and evaluation of the economic viability of the
deposit. Because an indicated mineral resource has a lower level of
confidence than the level of confidence of a measured mineral
resource, an indicated mineral resource may only be converted to a
probable mineral reserve.
(11) The term "inferred resources" means
that part of a mineral resource for which quantity and grade or
quality are estimated on the basis of limited geological evidence
and sampling. The level of geological uncertainty associated with
an inferred mineral resource is too high to apply relevant
technical and economic factors likely to influence the prospects of
economic extraction in a manner useful for evaluation of economic
viability. Because an inferred mineral resource has the lowest
level of geological confidence of all mineral resources, which
prevents the application of the modifying factors in a manner
useful for evaluation of economic viability, an inferred mineral
resource may not be considered when assessing the economic
viability of a mining project, and may not be converted to a
mineral reserve.
(12) Mineral resources are based on
$1700/oz gold, $21/oz silver, $1.15/lb lead, $1.35/lb zinc and
$3.00/lb copper, unless otherwise stated.
(13) The resource NSR cut-off values for
Greens Creek are $210/ton for all zones except the Gallagher Zone
at $215/ton; metallurgical recoveries (actual 2022): 81% for
silver, 72% for gold, 82% for lead, and 89% for zinc.
(14) The resource NSR cut-off values for
Lucky Friday are $200.57/ton for the 30 Vein, $227.90/ton for the
Intermediate Veins and $198.48/ton for the Lucky Friday Veins;
metallurgical recoveries (actual 2022): 95% for silver, 95% for
lead, and 88% for zinc.
(15) The average resource cut-off grades
at Casa Berardi are 0.11 oz/ton gold for underground and 0.034
oz/ton gold for open pit; metallurgical recovery (actual 2022): 87%
for gold; US$/CAN$ exchange rate: 1:1.3.
(16) The resource NSR cut-off value at
Keno Hill is $129.10/ton (CAN$185/tonne); using minimum width of
4.9 feet (1.5m); metallurgical recovery: 93% for silver, 25% for
gold, 93% for lead, 72% for zinc; US$/CAN$ exchange rate: 1:1.3
(17) Indicated resources for most zones at
San Sebastian based on $1500/oz gold, $21/oz silver, $1.15/lb lead,
$1.35/lb zinc and $3.00/lb copper using a cut-off grade of
$90.72/ton ($100/tonne); $1700/oz gold used for Toro, Bronco, and
Tigre zones. Metallurgical recoveries based on grade dependent
recovery curves: recoveries at the mean resource grade average 89%
for silver and 84% for gold for oxide material and 85% for silver,
83% for gold, 81% for lead, 86% for zinc, and 83% for copper for
sulfide material. Resources reported at a minimum mining width of
8.2 feet (2.5m) for Middle Vein, North Vein, and East Francine,
6.5ft (1.98m) for El Toro, El Bronco, and El Tigre, and 4.9 feet
(1.5 m) for Hugh Zone and Andrea.
(18) Mineral resources for Fire Creek,
Hollister and Midas are reported using $1500/oz gold and $21/oz
silver prices, unless otherwise noted. A minimum mining width is
defined as four feet or the vein true thickness plus two feet,
whichever is greater.
(19) Fire Creek mineral resources are
reported at a gold equivalent cut-off grade of 0.283 oz/ton.
Metallurgical recoveries: 90% for gold and 70% for silver.
(20) Hollister mineral resources,
including the Hatter Graben are reported at a gold equivalent
cut-off grade of 0.238 oz/ton. Metallurgical recoveries: 88% for
gold and 66% for silver
(21) Midas mineral resources are reported
at a gold equivalent cut-off grade of 0.237 oz/ton. Metallurgical
recoveries: 90% for gold and 70% for silver. A gold-equivalent
cut-off grade of 0.1 oz/ton and a gold price of $1700/oz used for
Sinter Zone with resources undiluted.
(22) Measured, indicated and inferred
resources at Heva and Hosco are based on $1,500/oz gold. Resources
are without dilution or material loss at a gold cut-off grade of
0.01 oz/ton for open pit and 0.088 oz/ton for underground.
Metallurgical recovery: Heva: 95% for gold, Hosco: 87.7% for
gold.
(23) Indicated and Inferred resources at
the Star property are reported using a minimum mining width of 4.3
feet and an NSR cut-off value of $150/ton; Metallurgical recovery:
93% for silver, 93% for lead, and 87% for zinc.
(24) Inferred open-pit resources for Fire
Creek calculated November 30, 2017 using gold and silver recoveries
of 65% and 30% for oxide material and 60% and 25% for mixed
oxide-sulfide material. Indicated Resources reclassified as
Inferred in 2019. Open pit resources are calculated at $1400 gold
and $19.83 silver and cut-off grade of 0.01 Au Equivalent oz/ton
and is inclusive of 10% mining dilution and 5% ore loss. Open pit
mineral resources exclusive of underground mineral resources.
NI43-101 Technical Report for the Fire Creek Project, Lander
County, Nevada; Effective Date March 31, 2018; prepared by
Practical Mining LLC, Mark Odell, P.E. for Hecla Mining Company,
June 28, 2018.
(25) Inferred resources reported at a
minimum mining width of 6.0 feet for Bulldog and an NSR cut-off
value of $175/ton and 5.0 feet for Equity and North Amethyst veins
at an NSR cut-off value of $100/ton; Metallurgical recoveries based
on grade dependent recovery curves; metal recoveries at the mean
resource grade average 89% silver, 74% lead, and 81% zinc for the
Bulldog and a constant 85% gold and 85% silver for North Amethyst
and Equity.
(26) Inferred resource at Monte Cristo
reported at a minimum mining width of 5.0 feet; resources based on
$1400 Au, $26.50 Ag using a 0.06 oz/ton gold cut-off grade.
Metallurgical recovery: 90% for gold and 90% silver.
(27) Inferred resource at Rock Creek
reported at a minimum thickness of 15 feet and an NSR cut-off value
of $24.50/ton; Metallurgical recoveries: 88% for silver and 92% for
copper. Resources adjusted based on mining restrictions as defined
by U.S. Forest Service, Kootenai National Forest in the June 2003
'Record of Decision, Rock Creek Project'
(28) Inferred resource at Montanore
reported at a minimum thickness of 15 feet and an NSR cut-off value
of $24.50/ton NSR; Metallurgical recoveries: 88% for silver and 92%
copper. Resources adjusted based on mining restrictions as defined
by U.S. Forest Service, Kootenai National Forest, Montana DEQ in
December 2015 'Joint Final EIS, Montanore Project' and the February
2016 U.S Forest Service - Kootenai National Forest 'Record of
Decision, Montanore Project'.
Totals may not represent the sum of parts
due to rounding
Category: Earnings
View source
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Anvita M. Patil Vice President - Investor Relations and
Treasurer
Cheryl Turner Communications Coordinator
800-HECLA91 (800-432-5291) Investor Relations Email:
hmc-info@hecla-mining.com Website: http://www.hecla-mining.com
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