[10-Q] Hecla Mining Company Quarterly Earnings Report
Q2 FY25 snapshot (ended 27-Jun-25):
- Total revenue $78.9 m (+1.6 % YoY); revenue-before-reimb. $77.6 m (+2.3 %).
- Operating income fell 63 % to $4.6 m; net income collapsed 81 % to $1.7 m, diluted EPS $0.06 vs $0.31.
- Gross margin compressed to 35 % as non-cash stock-based comp soared to $9.7 m (prior-year $2.9 m) due to new market-price awards and LeewayHertz earn-outs.
- Segment mix: Global S&BT $44.2 m (+4.6 %), SAP Solutions $13.9 m (+12.5 %), Oracle Solutions $20.8 m (-9.7 %).
- H1 operating cash flow $9.8 m (-40 %); cash balance $10.1 m (-38 % YTD) after $10 m revolver draw, pushing debt to $22.8 m.
- Capital deployment: $10.5 m share buybacks (382 k shs), $6.6 m dividends; repurchase authorization lifted to $30 m.
- Acquisitions: Spend Matters assets ($0.8 m) added $2.0 m intangibles; leverage of FY24 LeewayHertz AI deal takes goodwill to $91.1 m.
- Future: Q3 restructuring charge $1.5-2.0 m aligned with Gen-AI strategy.
Company remains covenant-compliant on $100 m revolver; liquidity tightens but platform and AI moves aim at long-term growth.
Riepilogo Q2 FY25 (terminato il 27-giu-25):
- Ricavi totali $78,9 mln (+1,6% su base annua); ricavi al netto dei rimborsi $77,6 mln (+2,3%).
- Utile operativo in calo del 63% a $4,6 mln; utile netto crollato dell'81% a $1,7 mln, EPS diluito $0,06 vs $0,31.
- Margine lordo ridotto al 35% a causa dell鈥檃umento della remunerazione azionaria non monetaria a $9,7 mln (precedente $2,9 mln) dovuto a nuovi premi basati sul prezzo di mercato e agli earn-out di LeewayHertz.
- Composizione segmenti: Global S&BT $44,2 mln (+4,6%), SAP Solutions $13,9 mln (+12,5%), Oracle Solutions $20,8 mln (-9,7%).
- Flusso di cassa operativo H1 $9,8 mln (-40%); saldo di cassa $10,1 mln (-38% da inizio anno) dopo un prelievo di $10 mln sul revolver, portando il debito a $22,8 mln.
- Distribuzione capitale: riacquisto azioni per $10,5 mln (382 mila azioni), dividendi $6,6 mln; autorizzazione al riacquisto aumentata a $30 mln.
- Acquisizioni: asset di Spend Matters ($0,8 mln) hanno aggiunto $2,0 mln di attivit脿 immateriali; la leva dell鈥檃ccordo AI LeewayHertz FY24 porta l鈥檃vviamento a $91,1 mln.
- Futuro: onere di ristrutturazione Q3 stimato tra $1,5-2,0 mln in linea con la strategia Gen-AI.
L鈥檃zienda resta conforme ai covenant sul revolver da $100 mln; liquidit脿 pi霉 stretta ma le iniziative su piattaforma e AI puntano alla crescita a lungo termine.
Resumen del Q2 FY25 (finalizado el 27-jun-25):
- Ingresos totales $78.9 M (+1.6 % interanual); ingresos antes de reembolsos $77.6 M (+2.3 %).
- Ingresos operativos cayeron 63 % a $4.6 M; ingreso neto colaps贸 81 % a $1.7 M, EPS diluido $0.06 vs $0.31.
- Margen bruto comprimido al 35 % debido al aumento de la compensaci贸n en acciones no monetaria a $9.7 M (a帽o previo $2.9 M) por nuevos premios basados en precio de mercado y earn-outs de LeewayHertz.
- Mix de segmentos: Global S&BT $44.2 M (+4.6 %), SAP Solutions $13.9 M (+12.5 %), Oracle Solutions $20.8 M (-9.7 %).
- Flujo de caja operativo H1 $9.8 M (-40 %); saldo de caja $10.1 M (-38 % en el a帽o) tras un uso de $10 M del revolver, elevando deuda a $22.8 M.
- Despliegue de capital: recompra de acciones por $10.5 M (382 mil acciones), dividendos $6.6 M; autorizaci贸n de recompra aumentada a $30 M.
- Adquisiciones: activos de Spend Matters ($0.8 M) a帽adieron $2.0 M en intangibles; la apalancamiento del acuerdo AI LeewayHertz FY24 lleva el goodwill a $91.1 M.
- Futuro: cargo de reestructuraci贸n Q3 de $1.5-2.0 M alineado con la estrategia Gen-AI.
La compa帽铆a sigue cumpliendo los convenios del revolver de $100 M; liquidez ajustada pero las iniciativas en plataforma y AI apuntan a crecimiento a largo plazo.
FY25 2攵勱赴 鞖旍暯 (2025雲� 6鞗� 27鞚� 膦呺):
- 齑� 毵れ稖 $7,890毵� (+1.6% 鞝勲厔 雽�牍�); 頇橁笁 鞝� 毵れ稖 $7,760毵� (+2.3%).
- 鞓侅梾鞚挫澋 63% 臧愳唽頃橃棳 $460毵�; 靾滌澊鞚� 81% 旮夑皭頃橃棳 $170毵�, 頋劃 欤茧嫻靾滌澊鞚� $0.06 (鞝勲厔 $0.31 雽�牍�).
- 牍勴槃旮� 欤检嫕氤挫儊牍勳毄鞚� 鞁犾嫓鞛� 臧�瓴� 旮办 氤挫儊 氚� LeewayHertz 鞚胳垬靹标臣旮夓溂搿� 鞚疙暣 $970毵�(鞝勲厔 $290毵�)鞙茧 旮夓頃橂┌ 齑濎澊鞚惦 35%搿� 於曥唽.
- 攵�氍鸽硠 毵れ稖 甑劚: 旮�搿滊矊 S&BT $4,420毵� (+4.6%), SAP 靻旊（靺� $1,390毵� (+12.5%), 鞓る澕韥� 靻旊（靺� $2,080毵� (-9.7%).
- 靸侂皹旮� 鞓侅梾順勱笀頋愲 $980毵� (-40%); 順勱笀 鞛旍暋 $1,010毵� (-38% 鞐办磮 雽�牍�), $1,000毵� 彀瀰 頉� 攵�毂� $2,280毵岇溂搿� 歃濌皜.
- 鞛愲掣 氚半秳: 鞛愳偓欤� 毵れ瀰 $1,050毵� (38毵� 2觳� 欤�), 氚半嫻旮� $660毵�; 鞛愳偓欤� 毵れ瀰 頃滊弰 $3,000毵岇溂搿� 靸來枼.
- 鞚胳垬: Spend Matters 鞛愳偘 ($80毵�)鞙茧 氍错槙鞛愳偘 $200毵� 於旉皜; FY24 LeewayHertz AI 瓿勳暯 霠堧矂毽搿� 鞓侅梾甓� $9,110毵�.
- 頄ロ泟 瓿勴殟: 3攵勱赴 甑“臁办爼 牍勳毄 $150毵寏200毵�, Gen-AI 鞝勲灥瓿� 鞚检箻.
須岇偓電� $1鞏� revolver 雽�於� covenant 欷�靾� 欷�; 鞙犽彊靹膘潃 韮�鞚错姼頃橃毵� 頂岆灚韽� 氚� AI 鞝勲灥鞙茧 鞛リ赴 靹膘灔 氇╉憸.
R茅sum茅 du T2 FY25 (cl么tur茅 le 27 juin 2025) :
- Revenu total de 78,9 M$ (+1,6 % en glissement annuel) ; revenu hors remboursements de 77,6 M$ (+2,3 %).
- R茅sultat op茅rationnel en baisse de 63 % 脿 4,6 M$ ; r茅sultat net en chute de 81 % 脿 1,7 M$, BPA dilu茅 de 0,06 $ contre 0,31 $.
- Marge brute r茅duite 脿 35 % en raison d鈥檜ne forte augmentation de la r茅mun茅ration en actions non mon茅taire 脿 9,7 M$ (2,9 M$ l鈥檃n pass茅) li茅e aux nouvelles attributions bas茅es sur le cours du march茅 et aux earn-outs de LeewayHertz.
- R茅partition par segment : Global S&BT 44,2 M$ (+4,6 %), SAP Solutions 13,9 M$ (+12,5 %), Oracle Solutions 20,8 M$ (-9,7 %).
- Flux de tr茅sorerie op茅rationnel H1 de 9,8 M$ (-40 %) ; solde de tr茅sorerie de 10,1 M$ (-38 % depuis le d茅but d鈥檃nn茅e) apr猫s un tirage de 10 M$ sur la ligne de cr茅dit, portant la dette 脿 22,8 M$.
- Utilisation du capital : rachats d鈥檃ctions pour 10,5 M$ (382 k actions), dividendes de 6,6 M$ ; autorisation de rachat port茅e 脿 30 M$.
- Acquisitions : actifs Spend Matters (0,8 M$) ajoutant 2,0 M$ d鈥檌mmobilisations incorporelles ; effet de levier de l鈥檃ccord AI LeewayHertz FY24 portant le goodwill 脿 91,1 M$.
- Avenir : charge de restructuration au T3 estim茅e entre 1,5 et 2,0 M$, en ligne avec la strat茅gie Gen-AI.
L鈥檈ntreprise reste conforme aux covenants sur la ligne de cr茅dit de 100 M$ ; la liquidit茅 se resserre mais les initiatives plateforme et IA visent une croissance 脿 long terme.
Q2 FY25 脺berblick (Ende 27. Juni 2025):
- Gesamtumsatz $78,9 Mio (+1,6 % gegen眉ber Vorjahr); Umsatz vor Erstattungen $77,6 Mio (+2,3 %).
- Betriebsergebnis sank um 63 % auf $4,6 Mio; Nettogewinn brach um 81 % auf $1,7 Mio ein, verw盲ssertes EPS $0,06 gegen眉ber $0,31.
- Bruttomarge schrumpfte auf 35 %, da nicht zahlungswirksame aktienbasierte Verg眉tung auf $9,7 Mio stieg (Vorjahr $2,9 Mio) aufgrund neuer marktpreisbasierter Auszeichnungen und Earn-outs von LeewayHertz.
- Segmentmix: Global S&BT $44,2 Mio (+4,6 %), SAP Solutions $13,9 Mio (+12,5 %), Oracle Solutions $20,8 Mio (-9,7 %).
- Operativer Cashflow H1 $9,8 Mio (-40 %); Kassenbestand $10,1 Mio (-38 % im Jahresverlauf) nach $10 Mio Revolver-Abhebung, wodurch die Verschuldung auf $22,8 Mio stieg.
- Kapitalverwendung: Aktienr眉ckk盲ufe $10,5 Mio (382 Tsd. Aktien), Dividenden $6,6 Mio; R眉ckkaufgenehmigung auf $30 Mio erh枚ht.
- Akquisitionen: Spend Matters Verm枚genswerte ($0,8 Mio) f眉gten $2,0 Mio immaterielle Verm枚genswerte hinzu; Hebelwirkung des FY24 LeewayHertz AI-Deals erh枚ht den Firmenwert auf $91,1 Mio.
- Zukunft: Q3 Restrukturierungskosten von $1,5-2,0 Mio im Einklang mit der Gen-AI-Strategie.
Das Unternehmen bleibt covenant-konform beim $100 Mio Revolver; Liquidit盲t wird enger, aber Plattform- und KI-Initiativen zielen auf langfristiges Wachstum ab.
- Revenue resilience: total revenue up 1.6 % YoY despite mixed IT-services market.
- SAP & Global S&BT growth: double-digit SAP and mid-single-digit consulting gains indicate traction in AI-led and transformation offerings.
- Expanded buyback capacity: board boosted repurchase authorization to $30 m, signalling confidence.
- Covenant headroom: company remains compliant on $100 m revolver with net debt still moderate.
- Profit collapse: net income down 81 %; diluted EPS fell to $0.06.
- Margin pressure: surge in stock-based compensation and SG&A slashed operating margin from 16 % to 6 %.
- Liquidity decline: cash dropped 38 % YTD while debt almost doubled to $22.8 m.
- Oracle Solutions weakness: segment revenue fell 9.7 %, signalling client decision delays.
- Upcoming restructuring: expected $1.5-2.0 m charge will further dent H2 earnings.
Insights
TL;DR 鈥� Earnings down sharply; cash squeezed; AI bets increase risk-reward.
The 2 % revenue uptick masks severe margin erosion driven by unusually high $19 m YTD stock-comp and integration costs. Net leverage is still modest, yet cash coverage has thinned to 0.4脳 quarterly SG&A, limiting flexibility while buybacks and dividends continue. Segment data show solid demand for S&BT and SAP work, but Oracle slowdown and forthcoming restructuring create uncertainty. Unless AI-led wins materialise, FY25 EPS guidance (not supplied here) is likely to reset lower. Overall tone: negative.
TL;DR 鈥� Strategic pivot to Gen AI intact; near-term profitability sacrificed.
Hackett is doubling down on Gen AI by integrating LeewayHertz鈥檚 ZBrain and purchasing Spend Matters data assets. These moves strengthen IP and could raise price-per-engagement, but they also inflate compensation and integration overheads, compressing margin to 5.8 %. Client mix still U.S.-centric (79 % revenue). Upcoming $1.5-2 m severance should streamline delivery once AI platforms scale. Investors must weigh short-term earnings pain against differentiated AI value proposition.
Riepilogo Q2 FY25 (terminato il 27-giu-25):
- Ricavi totali $78,9 mln (+1,6% su base annua); ricavi al netto dei rimborsi $77,6 mln (+2,3%).
- Utile operativo in calo del 63% a $4,6 mln; utile netto crollato dell'81% a $1,7 mln, EPS diluito $0,06 vs $0,31.
- Margine lordo ridotto al 35% a causa dell鈥檃umento della remunerazione azionaria non monetaria a $9,7 mln (precedente $2,9 mln) dovuto a nuovi premi basati sul prezzo di mercato e agli earn-out di LeewayHertz.
- Composizione segmenti: Global S&BT $44,2 mln (+4,6%), SAP Solutions $13,9 mln (+12,5%), Oracle Solutions $20,8 mln (-9,7%).
- Flusso di cassa operativo H1 $9,8 mln (-40%); saldo di cassa $10,1 mln (-38% da inizio anno) dopo un prelievo di $10 mln sul revolver, portando il debito a $22,8 mln.
- Distribuzione capitale: riacquisto azioni per $10,5 mln (382 mila azioni), dividendi $6,6 mln; autorizzazione al riacquisto aumentata a $30 mln.
- Acquisizioni: asset di Spend Matters ($0,8 mln) hanno aggiunto $2,0 mln di attivit脿 immateriali; la leva dell鈥檃ccordo AI LeewayHertz FY24 porta l鈥檃vviamento a $91,1 mln.
- Futuro: onere di ristrutturazione Q3 stimato tra $1,5-2,0 mln in linea con la strategia Gen-AI.
L鈥檃zienda resta conforme ai covenant sul revolver da $100 mln; liquidit脿 pi霉 stretta ma le iniziative su piattaforma e AI puntano alla crescita a lungo termine.
Resumen del Q2 FY25 (finalizado el 27-jun-25):
- Ingresos totales $78.9 M (+1.6 % interanual); ingresos antes de reembolsos $77.6 M (+2.3 %).
- Ingresos operativos cayeron 63 % a $4.6 M; ingreso neto colaps贸 81 % a $1.7 M, EPS diluido $0.06 vs $0.31.
- Margen bruto comprimido al 35 % debido al aumento de la compensaci贸n en acciones no monetaria a $9.7 M (a帽o previo $2.9 M) por nuevos premios basados en precio de mercado y earn-outs de LeewayHertz.
- Mix de segmentos: Global S&BT $44.2 M (+4.6 %), SAP Solutions $13.9 M (+12.5 %), Oracle Solutions $20.8 M (-9.7 %).
- Flujo de caja operativo H1 $9.8 M (-40 %); saldo de caja $10.1 M (-38 % en el a帽o) tras un uso de $10 M del revolver, elevando deuda a $22.8 M.
- Despliegue de capital: recompra de acciones por $10.5 M (382 mil acciones), dividendos $6.6 M; autorizaci贸n de recompra aumentada a $30 M.
- Adquisiciones: activos de Spend Matters ($0.8 M) a帽adieron $2.0 M en intangibles; la apalancamiento del acuerdo AI LeewayHertz FY24 lleva el goodwill a $91.1 M.
- Futuro: cargo de reestructuraci贸n Q3 de $1.5-2.0 M alineado con la estrategia Gen-AI.
La compa帽铆a sigue cumpliendo los convenios del revolver de $100 M; liquidez ajustada pero las iniciativas en plataforma y AI apuntan a crecimiento a largo plazo.
FY25 2攵勱赴 鞖旍暯 (2025雲� 6鞗� 27鞚� 膦呺):
- 齑� 毵れ稖 $7,890毵� (+1.6% 鞝勲厔 雽�牍�); 頇橁笁 鞝� 毵れ稖 $7,760毵� (+2.3%).
- 鞓侅梾鞚挫澋 63% 臧愳唽頃橃棳 $460毵�; 靾滌澊鞚� 81% 旮夑皭頃橃棳 $170毵�, 頋劃 欤茧嫻靾滌澊鞚� $0.06 (鞝勲厔 $0.31 雽�牍�).
- 牍勴槃旮� 欤检嫕氤挫儊牍勳毄鞚� 鞁犾嫓鞛� 臧�瓴� 旮办 氤挫儊 氚� LeewayHertz 鞚胳垬靹标臣旮夓溂搿� 鞚疙暣 $970毵�(鞝勲厔 $290毵�)鞙茧 旮夓頃橂┌ 齑濎澊鞚惦 35%搿� 於曥唽.
- 攵�氍鸽硠 毵れ稖 甑劚: 旮�搿滊矊 S&BT $4,420毵� (+4.6%), SAP 靻旊（靺� $1,390毵� (+12.5%), 鞓る澕韥� 靻旊（靺� $2,080毵� (-9.7%).
- 靸侂皹旮� 鞓侅梾順勱笀頋愲 $980毵� (-40%); 順勱笀 鞛旍暋 $1,010毵� (-38% 鞐办磮 雽�牍�), $1,000毵� 彀瀰 頉� 攵�毂� $2,280毵岇溂搿� 歃濌皜.
- 鞛愲掣 氚半秳: 鞛愳偓欤� 毵れ瀰 $1,050毵� (38毵� 2觳� 欤�), 氚半嫻旮� $660毵�; 鞛愳偓欤� 毵れ瀰 頃滊弰 $3,000毵岇溂搿� 靸來枼.
- 鞚胳垬: Spend Matters 鞛愳偘 ($80毵�)鞙茧 氍错槙鞛愳偘 $200毵� 於旉皜; FY24 LeewayHertz AI 瓿勳暯 霠堧矂毽搿� 鞓侅梾甓� $9,110毵�.
- 頄ロ泟 瓿勴殟: 3攵勱赴 甑“臁办爼 牍勳毄 $150毵寏200毵�, Gen-AI 鞝勲灥瓿� 鞚检箻.
須岇偓電� $1鞏� revolver 雽�於� covenant 欷�靾� 欷�; 鞙犽彊靹膘潃 韮�鞚错姼頃橃毵� 頂岆灚韽� 氚� AI 鞝勲灥鞙茧 鞛リ赴 靹膘灔 氇╉憸.
R茅sum茅 du T2 FY25 (cl么tur茅 le 27 juin 2025) :
- Revenu total de 78,9 M$ (+1,6 % en glissement annuel) ; revenu hors remboursements de 77,6 M$ (+2,3 %).
- R茅sultat op茅rationnel en baisse de 63 % 脿 4,6 M$ ; r茅sultat net en chute de 81 % 脿 1,7 M$, BPA dilu茅 de 0,06 $ contre 0,31 $.
- Marge brute r茅duite 脿 35 % en raison d鈥檜ne forte augmentation de la r茅mun茅ration en actions non mon茅taire 脿 9,7 M$ (2,9 M$ l鈥檃n pass茅) li茅e aux nouvelles attributions bas茅es sur le cours du march茅 et aux earn-outs de LeewayHertz.
- R茅partition par segment : Global S&BT 44,2 M$ (+4,6 %), SAP Solutions 13,9 M$ (+12,5 %), Oracle Solutions 20,8 M$ (-9,7 %).
- Flux de tr茅sorerie op茅rationnel H1 de 9,8 M$ (-40 %) ; solde de tr茅sorerie de 10,1 M$ (-38 % depuis le d茅but d鈥檃nn茅e) apr猫s un tirage de 10 M$ sur la ligne de cr茅dit, portant la dette 脿 22,8 M$.
- Utilisation du capital : rachats d鈥檃ctions pour 10,5 M$ (382 k actions), dividendes de 6,6 M$ ; autorisation de rachat port茅e 脿 30 M$.
- Acquisitions : actifs Spend Matters (0,8 M$) ajoutant 2,0 M$ d鈥檌mmobilisations incorporelles ; effet de levier de l鈥檃ccord AI LeewayHertz FY24 portant le goodwill 脿 91,1 M$.
- Avenir : charge de restructuration au T3 estim茅e entre 1,5 et 2,0 M$, en ligne avec la strat茅gie Gen-AI.
L鈥檈ntreprise reste conforme aux covenants sur la ligne de cr茅dit de 100 M$ ; la liquidit茅 se resserre mais les initiatives plateforme et IA visent une croissance 脿 long terme.
Q2 FY25 脺berblick (Ende 27. Juni 2025):
- Gesamtumsatz $78,9 Mio (+1,6 % gegen眉ber Vorjahr); Umsatz vor Erstattungen $77,6 Mio (+2,3 %).
- Betriebsergebnis sank um 63 % auf $4,6 Mio; Nettogewinn brach um 81 % auf $1,7 Mio ein, verw盲ssertes EPS $0,06 gegen眉ber $0,31.
- Bruttomarge schrumpfte auf 35 %, da nicht zahlungswirksame aktienbasierte Verg眉tung auf $9,7 Mio stieg (Vorjahr $2,9 Mio) aufgrund neuer marktpreisbasierter Auszeichnungen und Earn-outs von LeewayHertz.
- Segmentmix: Global S&BT $44,2 Mio (+4,6 %), SAP Solutions $13,9 Mio (+12,5 %), Oracle Solutions $20,8 Mio (-9,7 %).
- Operativer Cashflow H1 $9,8 Mio (-40 %); Kassenbestand $10,1 Mio (-38 % im Jahresverlauf) nach $10 Mio Revolver-Abhebung, wodurch die Verschuldung auf $22,8 Mio stieg.
- Kapitalverwendung: Aktienr眉ckk盲ufe $10,5 Mio (382 Tsd. Aktien), Dividenden $6,6 Mio; R眉ckkaufgenehmigung auf $30 Mio erh枚ht.
- Akquisitionen: Spend Matters Verm枚genswerte ($0,8 Mio) f眉gten $2,0 Mio immaterielle Verm枚genswerte hinzu; Hebelwirkung des FY24 LeewayHertz AI-Deals erh枚ht den Firmenwert auf $91,1 Mio.
- Zukunft: Q3 Restrukturierungskosten von $1,5-2,0 Mio im Einklang mit der Gen-AI-Strategie.
Das Unternehmen bleibt covenant-konform beim $100 Mio Revolver; Liquidit盲t wird enger, aber Plattform- und KI-Initiativen zielen auf langfristiges Wachstum ab.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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(I.R.S. Employer |
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Securities registered pursuant to Section 12(b) of the Act:
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Stock, par value $0.25 per share |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
|
☑ |
|
Accelerated filer |
|
☐ |
|
Non-accelerated filer |
|
☐ |
|
Smaller reporting company |
|
|
Emerging growth company |
|
|
|
|
|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Class |
|
Shares Outstanding August 1, 2025 |
Common stock, par value $0.25 par value per share |
|
Hecla Mining Company
Form 10-Q
For the Quarter Ended June 30, 2025
INDEX*
|
|
Page |
|
|
|
PART I. |
FINANCIAL INFORMATION |
3 |
|
|
|
Item 1. |
Financial Statements (Unaudited) |
3 |
|
Condensed Consolidated Statements of Operations and Comprehensive Income - Three Months Ended and Six Months Ended June 30, 2025 and 2024 |
3 |
|
Condensed Consolidated Statements of Cash Flows - Six Months Ended June 30, 2025 and 2024 |
4 |
|
Condensed Consolidated Balance Sheets - June 30, 2025 and December 31, 2024 |
6 |
|
Condensed Consolidated Statements of Changes in Stockholders' Equity – Three Months Ended and Six Months Ended June 30, 2025 and 2024 |
7 |
|
Notes to Condensed Consolidated Financial Statements (unaudited) |
9 |
|
Forward-Looking Statements |
25 |
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
26 |
|
Overview |
26 |
|
Consolidated Results of Operations |
27 |
|
Reconciliation of Total Cost of Sales 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) |
42 |
|
Financial Liquidity and Capital Resources |
52 |
|
Contractual Obligations, Contingent Liabilities and Commitments |
55 |
|
Critical Accounting Estimates |
55 |
|
Off-Balance Sheet Arrangements |
56 |
|
Guarantor Subsidiaries |
56 |
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk |
59 |
Item 4. |
Controls and Procedures |
60 |
|
|
|
PART II. |
OTHER INFORMATION |
61 |
|
|
|
Item 1. |
Legal Proceedings |
61 |
Item 1A. |
Risk Factors |
61 |
Item 4. |
Mine Safety Disclosures |
61 |
Item 5. |
Other Information |
61 |
Item 6. |
Exhibits |
62 |
Signatures |
63 |
|
*Items 2 and 3 of Part II are omitted as they are not applicable. |
|
|
2
Part I - Financial Information
Item 1. Financial Statements
Hecla Mining Company
Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)
(Dollars and shares in thousands, except for per-share amounts)
|
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Three Months Ended |
|
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Six Months Ended |
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||||||||||
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June 30, 2025 |
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June 30, 2024 |
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June 30, 2025 |
|
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June 30, 2024 |
|
||||
Sales |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Cost of sales and other direct production costs |
|
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|
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|
||||
Depreciation, depletion and amortization |
|
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|
||||
Total cost of sales |
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Gross profit |
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|
||||
Other operating expenses: |
|
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|
||||
General and administrative |
|
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|
||||
Exploration and pre-development |
|
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|
||||
Ramp-up and suspension costs |
|
|
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|
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|
||||
Provision for closed operations and environmental matters |
|
|
|
|
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|
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|
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|
|
|
||||
Other operating (income) expense, net |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Total other operating expenses |
|
|
|
|
|
|
|
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|
||||
Income from operations |
|
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|
||||
Other expense: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Fair value adjustments, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net foreign exchange (loss) gain |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Other income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total other expense |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Income before income and mining taxes |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income and mining tax provision |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Preferred stock dividends |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net income applicable to common stockholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Change in fair value of derivative contracts designated as hedge transactions |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Comprehensive income |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Basic income per common share after preferred dividends |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Diluted income per common share after preferred dividends |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Weighted average number of common shares outstanding - basic |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average number of common shares outstanding - diluted |
|
|
|
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|
|
|
|
|
|
|
||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
3
Hecla Mining Company
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
|
|
Six Months Ended |
|
|||||
|
|
June 30, 2025 |
|
|
June 30, 2024 |
|
||
Operating activities: |
|
|
|
|
|
|
||
Net income |
|
$ |
|
|
$ |
|
||
Non-cash elements included in net income: |
|
|
|
|
|
|
||
Depreciation, depletion and amortization |
|
|
|
|
|
|
||
Inventory adjustments |
|
|
|
|
|
|
||
Fair value adjustments, net |
|
|
( |
) |
|
|
( |
) |
Provision for reclamation and closure costs |
|
|
|
|
|
|
||
Stock-based compensation |
|
|
|
|
|
|
||
Deferred income taxes |
|
|
|
|
|
|
||
Net foreign exchange loss (gain) |
|
|
|
|
|
( |
) |
|
Other non-cash items, net |
|
|
( |
) |
|
|
( |
) |
Change in assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
( |
) |
|
|
( |
) |
Inventories |
|
|
( |
) |
|
|
( |
) |
Other current and non-current assets |
|
|
|
|
|
|
||
Accounts payable, accrued and other current liabilities |
|
|
|
|
|
( |
) |
|
Accrued payroll and related benefits |
|
|
|
|
|
|
||
Accrued taxes |
|
|
|
|
|
( |
) |
|
Accrued reclamation and closure costs and other non-current liabilities |
|
|
( |
) |
|
|
( |
) |
Net cash provided by operating activities |
|
|
|
|
|
|
||
Investing activities: |
|
|
|
|
|
|
||
Additions to property, plant and mine development |
|
|
( |
) |
|
|
( |
) |
Proceeds from investment sales |
|
|
|
|
|
|
||
Proceeds from asset dispositions |
|
|
|
|
|
|
||
Purchases of investments |
|
|
|
|
|
( |
) |
|
Net cash used in investing activities |
|
|
( |
) |
|
|
( |
) |
Financing activities: |
|
|
|
|
|
|
||
Proceeds from sale of common stock, net |
|
|
|
|
|
|
||
Acquisition of treasury stock |
|
|
( |
) |
|
|
( |
) |
Borrowing of debt |
|
|
|
|
|
|
||
Repayment of debt |
|
|
( |
) |
|
|
( |
) |
Dividends paid to common and preferred stockholders |
|
|
( |
) |
|
|
( |
) |
Repayments of finance leases and other |
|
|
( |
) |
|
|
( |
) |
Net cash provided by (used in) financing activities |
|
|
|
|
|
( |
) |
|
Effect of exchange rates on cash |
|
|
|
|
|
( |
) |
|
Net increase (decrease) in cash, cash equivalents and restricted cash and cash equivalents |
|
|
|
|
|
( |
) |
|
Cash, cash equivalents and restricted cash and cash equivalents at beginning of period |
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash and cash equivalents at end of period |
|
$ |
|
|
$ |
|
||
Reconciliation of cash and cash equivalents and restricted cash and cash equivalents above |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Non-current restricted cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Total cash and cash equivalents and restricted cash and cash equivalents as reported on the consolidated cash flow statement |
|
$ |
|
|
$ |
|
||
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
||
Cash paid for interest |
|
$ |
|
|
$ |
|
||
Cash paid for income and mining taxes, net |
|
$ |
|
|
$ |
|
||
Significant non-cash investing and financing activities: |
|
|
|
|
|
|
||
Common stock issued as incentive compensation |
|
$ |
|
|
$ |
|
||
Common stock issued for 401(k) match |
|
$ |
|
|
$ |
|
||
4
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
5
Hecla Mining Company
Condensed Consolidated Balance Sheets (Unaudited)
(In thousands, except shares)
|
|
June 30, 2025 |
|
|
December 31, 2024 |
|
||
ASSETS |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Accounts receivable: |
|
|
|
|
|
|
||
Trade |
|
|
|
|
|
|
||
Other, net |
|
|
|
|
|
|
||
Inventories: |
|
|
|
|
|
|
||
Product inventories |
|
|
|
|
|
|
||
Materials and supplies |
|
|
|
|
|
|
||
Other current assets |
|
|
|
|
|
|
||
Total current assets |
|
|
|
|
|
|
||
Investments |
|
|
|
|
|
|
||
Restricted cash and cash equivalents |
|
|
|
|
|
|
||
Property, plants, equipment and mine development, net |
|
|
|
|
|
|
||
Operating lease right-of-use assets |
|
|
|
|
|
|
||
Other non-current assets |
|
|
|
|
|
|
||
Total assets |
|
$ |
|
|
$ |
|
||
LIABILITIES |
|
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
|
||
Accounts payable and accrued liabilities |
|
$ |
|
|
$ |
|
||
Accrued payroll and related benefits |
|
|
|
|
|
|
||
Accrued taxes |
|
|
|
|
|
|
||
Current debt |
|
|
|
|
|
|
||
Finance leases |
|
|
|
|
|
|
||
Accrued reclamation and closure costs |
|
|
|
|
|
|
||
Accrued interest |
|
|
|
|
|
|
||
Other current liabilities |
|
|
|
|
|
|
||
Total current liabilities |
|
|
|
|
|
|
||
Accrued reclamation and closure costs |
|
|
|
|
|
|
||
Long-term debt including finance leases |
|
|
|
|
|
|
||
Deferred tax liabilities |
|
|
|
|
|
|
||
Other non-current liabilities |
|
|
|
|
|
|
||
Total liabilities |
|
|
|
|
|
|
||
|
|
|
|
|
|
|||
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Preferred stock, |
|
|
|
|
|
|
||
Series B preferred stock, $ |
|
|
|
|
|
|
||
Common stock, $ |
|
|
|
|
|
|
||
Capital surplus |
|
|
|
|
|
|
||
Accumulated deficit |
|
|
( |
) |
|
|
( |
) |
Accumulated other comprehensive loss, net |
|
|
( |
) |
|
|
( |
) |
Less treasury stock, at cost; June 30, 2025 — |
|
|
( |
) |
|
|
( |
) |
Total stockholders’ equity |
|
|
|
|
|
|
||
Total liabilities and stockholders’ equity |
|
$ |
|
|
$ |
|
||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
6
Hecla Mining Company
Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)
(Dollars are in thousands, except for share and per share amounts)
|
|
Three Months Ended June 30, 2025 |
||||||||||||
|
|
Series B |
|
Common |
|
Capital Surplus |
|
Accumulated |
|
Accumulated |
|
Treasury |
|
Total |
Balances, April 1, 2025 |
|
$ |
|
$ |
|
$ |
|
$( |
|
$( |
|
$( |
|
$ |
Net income |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
||
Stock-based compensation expense |
|
— |
|
|
|
|
— |
|
— |
|
— |
|
||
Stock-based compensation distributed ( |
|
— |
|
|
( |
|
— |
|
— |
|
( |
|
( |
|
Common stock issued to directors ( |
|
— |
|
|
|
— |
|
— |
|
— |
|
|||
Common stock issued for 401(k) match ( |
|
— |
|
|
|
— |
|
— |
|
— |
|
|||
Common stock ($ |
|
— |
|
— |
|
— |
|
( |
|
— |
|
— |
|
( |
Common stock issued under ATM program ( |
|
— |
|
|
|
— |
|
— |
|
— |
|
|||
Other comprehensive income |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
||
Balances, June 30, 2025 |
|
$ |
|
$ |
|
$ |
|
$( |
|
$( |
|
$( |
|
$ |
|
|
Three Months Ended June 30, 2024 |
||||||||||||
|
|
Series B |
|
Common |
|
Capital Surplus |
|
Accumulated |
|
Accumulated |
|
Treasury |
|
Total |
Balances, April 1, 2024 |
|
$ |
|
$ |
|
$ |
|
$( |
|
$ |
|
$( |
|
$ |
Net income |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
||
Stock-based compensation expense |
|
— |
|
— |
|
|
— |
|
— |
|
— |
|
||
Stock-based compensation distributed ( |
|
— |
|
|
( |
|
— |
|
— |
|
— |
|
— |
|
Common stock issued as compensation to interim CEO ( |
|
— |
|
|
|
— |
|
— |
|
— |
|
|||
Common stock issued to directors ( |
|
— |
|
|
|
— |
|
— |
|
— |
|
|||
Common stock ($ |
|
— |
|
— |
|
— |
|
( |
|
— |
|
— |
|
( |
Common stock issued for 401(k) match ( |
|
— |
|
|
|
— |
|
— |
|
— |
|
|||
Other comprehensive loss |
|
— |
|
— |
|
— |
|
— |
|
( |
|
— |
|
( |
Balances, June 30, 2024 |
|
$ |
|
$ |
|
$ |
|
$( |
|
$( |
|
$( |
|
$ |
7
|
|
Six Months Ended June 30, 2025 |
|
|||||||||||||||||||||||||
|
|
Series B |
|
|
Common |
|
|
Capital Surplus |
|
|
Accumulated |
|
|
Accumulated |
|
|
Treasury |
|
|
Total |
|
|||||||
Balances, January 1, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
||||
Net income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Stock-based compensation expense |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Stock-based compensation distributed ( |
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
Stock issued for incentive compensation ( |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Common stock issued to directors ( |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Common stock ($ |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Common stock issued under ATM program ( |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Common stock issued for 401(k) match ( |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Other comprehensive income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|||
Balances, June 30, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
||||
|
|
Six Months Ended June 30, 2024 |
|
|||||||||||||||||||||||||
|
|
Series B |
|
|
Common |
|
|
Capital Surplus |
|
|
Accumulated |
|
|
Accumulated |
|
|
Treasury |
|
|
Total |
|
|||||||
Balances, January 1, 2024 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
Net income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Stock-based compensation expense |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Stock-based compensation distributed ( |
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
Stock issued for incentive compensation ( |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
|
|||
Common stock issued as compensation to interim CEO ( |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Common stock issued to directors ( |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Common stock ($ |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Common stock issued under ATM program ( |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Common stock issued for 401(k) match ( |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Other comprehensive loss |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Balances, June 30, 2024 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
8
Note 1. Basis of Preparation of Financial Statements
The accompanying unaudited interim condensed consolidated financial statements of Hecla Mining Company and its subsidiaries (collectively, “Hecla,” “the Company,” “we,” “our,” or “us,” except where the context requires otherwise) have been prepared in accordance with the instructions to Form 10-Q and do not include all information and disclosures required annually by accounting principles generally accepted in the United States of America (“GAAP”). Therefore, this information should be read in conjunction with the Company’s consolidated financial statements and notes contained in our annual report on Form 10-K for the year ended December 31, 2024. The consolidated December 31, 2024 balance sheet data was derived from our audited consolidated financial statements. The information furnished herein reflects all adjustments that are, in the opinion of management, necessary for the fair presentation of the results for the interim periods reported. All such adjustments are, in the opinion of management, of a normal recurring nature. Operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.
Note 2. Business Segments and Sales of Products
We discover, acquire and develop mines and other mineral interests and produce and market (i) concentrates containing silver, gold, lead, zinc and copper, (ii) carbon material containing silver and gold, and (iii) doré containing silver and gold. We are currently organized and managed in
The Company regularly reviews its segment reporting for alignment with its strategic goals and operational structure as well as for evaluation of business performance and the allocation of resources by Hecla's President and Chief Executive Officer, who has been identified as our Chief Operating Decision Maker ("CODM"). The CODM evaluates the performance for all of our reportable segments based on segment gross profit or loss. For all segments, the CODM uses segment gross profit or loss to assess segment performance and allocate resources for each segment predominantly in the annual budget and forecasting process. The CODM considers budget to actual variances on a monthly basis when making decisions about allocating capital and personnel to the segments. Significant segment expenses that are components of total cost of goods sold and drive the financial performance of our reportable segments are (i) salaries, wages and other benefits, (ii) contractors, (iii) consumables (iv) change in product inventory and (v) other direct production costs. In further evaluating the operational performance of each segment, the CODM also considers the amount of metals production versus budget, and the grade of the metal processed.
General corporate activities not associated with operating mines and their various exploration activities, as well as idle properties and environmental remediation services in the Yukon, Canada, are presented as “other.” The nature of the items that reconcile gross profit to income before income and mining taxes are not related to our reportable segments.
9
The tables below present information about our reportable segments for the three and six months ended June 30, 2025 and 2024 (in thousands):
Three months ended June 30, 2025 |
Greens Creek |
|
Lucky Friday |
|
Keno Hill |
|
Casa Berardi |
|
Other |
|
Total |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Metal sales |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||
Environmental remediation services |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intersegment sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Elimination of intersegment sales |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Total consolidated sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of sales and other direct production costs |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Salaries, wages and other benefits |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Contractors |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Materials and consumables |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Product inventory change |
|
( |
) |
|
( |
) |
|
|
|
|
|
|
|
( |
) |
|||
Other direct production costs |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||||
Depreciation, depletion and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Gross profit (loss) |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
( |
) |
$ |
|
|||||
Other operating expenses (a) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income from operations |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||||
Fair value adjustments, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign exchange loss, net |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||||
Other income |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income before income and mining taxes |
|
|
|
|
|
|
|
|
|
|
$ |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Capital additions |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||
(a)
10
Three months ended June 30, 2024 |
Greens Creek |
|
Lucky Friday |
|
Keno Hill |
|
Casa Berardi |
|
Other |
|
Total |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Metal sales |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||
Environmental remediation services |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intersegment sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Elimination of intersegment sales |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Total consolidated sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of sales and other direct production costs |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Salaries, wages and employee benefits |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Contractors |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Materials and consumables |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Product inventory change |
|
( |
) |
|
|
|
|
|
|
|
|
|
( |
) |
||||
Other direct production costs |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Transfer to ramp-up and suspension costs(a) |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Depreciation, depletion and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Gross profit (loss) |
$ |
|
$ |
|
$ |
|
$ |
( |
) |
$ |
( |
) |
$ |
|
||||
Other operating expenses (b) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income from operations |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||||
Fair value adjustments, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign exchange gain, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other income |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income before income and mining taxes |
|
|
|
|
|
|
|
|
|
|
$ |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Capital additions |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||
(a)
(b)
11
Six months ended June 30, 2025 |
Greens Creek |
|
Lucky Friday |
|
Keno Hill |
|
Casa Berardi |
|
Other |
|
Total |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Metal sales |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||
Environmental remediation services |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intersegment sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Elimination of intersegment sales |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Total consolidated sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of sales and other direct production costs |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Salaries, wages and other benefits |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Contractors |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Materials and consumables |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Product inventory change |
|
( |
) |
|
|
|
( |
) |
|
( |
) |
|
|
|
( |
) |
||
Other direct production costs |
|
|
|
( |
) |
|
|
|
|
|
|
|
|
|||||
Depreciation, depletion and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Gross profit (loss) |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
( |
) |
$ |
|
|||||
Other operating expenses (a) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income from operations |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||||
Fair value adjustments, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign exchange loss, net |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||||
Other income |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income before income and mining taxes |
|
|
|
|
|
|
|
|
|
|
$ |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Capital additions |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||
(a)
12
Six months ended June 30, 2024 |
Greens Creek |
|
Lucky Friday |
|
Keno Hill |
|
Casa Berardi |
|
Other |
|
Total |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Metal sales |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||
Environmental remediation services |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Intersegment sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Elimination of intersegment sales |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Total consolidated sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of sales and other direct production costs |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Salaries, wages and employee benefits |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Contractors |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Materials and consumables |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Product inventory change |
|
( |
) |
|
( |
) |
|
( |
) |
|
( |
) |
|
|
|
( |
) |
|
Other direct production costs |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Transfer to ramp-up and suspension costs(a) |
|
|
|
( |
) |
|
( |
) |
|
|
|
|
|
( |
) |
|||
Depreciation, depletion and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Gross profit (loss) |
$ |
|
$ |
|
$ |
|
$ |
( |
) |
$ |
|
$ |
|
|||||
Other operating expenses (b) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income from operations |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||||
Fair value adjustments, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign exchange gain, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other income |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income before income and mining taxes |
|
|
|
|
|
|
|
|
|
|
$ |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Capital additions |
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||
(a)
(b)
Other sales for the three and six months ended June 30, 2025 and 2024 is solely comprised of revenue from our environmental remediation services subsidiary in the Yukon. Keno Hill sold $
Lucky Friday's income from operations for the three and six months ended June 30, 2024 included $
Sales by metal for the three and six months ended June 30, 2025 and 2024 were as follows (in thousands):
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Silver |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Gold |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Lead |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Zinc |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Copper |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Smelter and refining charges |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total metal sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Environmental remediation services |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total sales |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
13
Sales of metals for the three and six months ended June 30, 2025 include net gains of $
The following table presents total assets by reportable segment as of June 30, 2025 and December 31, 2024 (in thousands):
|
|
June 30, 2025 |
|
|
December 31, 2024 |
|
||
Total assets: |
|
|
|
|
|
|
||
Greens Creek |
|
$ |
|
|
$ |
|
||
Lucky Friday |
|
|
|
|
|
|
||
Keno Hill |
|
|
|
|
|
|
||
Casa Berardi |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
|
|
$ |
|
|
$ |
|
||
Note 3. Income and Mining Taxes
Major components of our income and mining tax for the three and six months ended June 30, 2025 and 2024 are as follows (in thousands):
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Current: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Domestic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Foreign |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total current income and mining tax provision |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Deferred: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Domestic |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Foreign |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Total deferred income and mining tax provision |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total income and mining tax provision |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
The income and mining tax provision for the three and six months ended June 30, 2025 and 2024 varies from the amounts that would have resulted from applying the statutory tax rates to pre-tax income or loss due primarily to the impact of taxation in foreign jurisdictions, non-recognition of net operating losses and foreign exchange gains and losses in certain jurisdictions.
For the three and six months ended June 30, 2025, we used the annual effective tax rate method to calculate the tax provision. Valuation allowances on Nevada, Mexico and certain Canadian net operating losses were treated as discrete adjustments to the tax provision.
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted in the U.S. The OBBBA permanently extends multiple tax provisions of the 2017 Tax Cuts and Jobs Act, as well as repeals, modifies and introduces various other tax provisions. We do not anticipate the OBBBA to have a material impact to the Company's consolidated financial statements. We continue to evaluate the impact the OBBBA may have on the Company as the legislation has various future effective dates.
14
Note 4. Employee Benefit Plans
We sponsor defined benefit pension plans covering all non-hourly U.S. employees hired prior to July 2024 and our hourly workers at the Lucky Friday mine, as well as and a Supplemental Excess Retirement Plan covering certain eligible employees.
Net periodic pension cost (benefit) for the plans consisted of the following for the three and six months ended June 30, 2025 and 2024 (in thousands):
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Service cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Interest cost |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Expected return on plan assets |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Amortization of prior service cost |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Amortization of net loss |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net periodic pension cost (benefit) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
For the three and six months ended June 30, 2025 and 2024, the service cost component of net periodic pension benefit is included in the same line items of our condensed consolidated financial statements as other employee compensation costs. The net benefit related to all other components of net periodic pension cost of $
Note 5. Earnings Per Common Share
We calculate basic earnings per common share on the basis of the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is calculated using the weighted average number of shares of common stock outstanding during the period plus the effect of potential dilutive common shares during the period using the treasury stock and if-converted methods.
Potential dilutive shares of common stock include outstanding unvested restricted stock awards, deferred restricted stock units, unvested performance based units and convertible preferred stock (collectively referred to as dilutive units) for all periods in which we have reported net income. The 2025 dilutive units exclude the impact of
The following table represents net income per common share – basic and diluted (in thousands, except income per share):
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Numerator |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Preferred stock dividends |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net income applicable to common stockholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Denominator |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic weighted average common shares |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Dilutive units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Diluted weighted average common shares |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic earnings per common share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Diluted earnings per common share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Note 6. Stockholders’ Equity
Authorized Share Capital
15
At our annual meeting of shareholders on May 21, 2025, our shareholders approved an amendment to our restated certificate of incorporation increasing the number of authorized shares of our common stock from
At-The-Market ("ATM") Equity Distribution Agreement
Pursuant to an equity distribution agreement dated February 18, 2021, we may offer and sell up to
Stock-based Compensation Plans
The Company has stock incentive plans for executives, directors and eligible employees, under which performance shares, restricted stock and shares of common stock are granted. Stock-based compensation expense for restricted stock units and performance-based grants to employees, totaled $
The following table summarizes the stock-based compensation grants awarded during the six months ended June 30, 2025:
Grant date |
|
Award type |
|
Number granted |
|
|
Grant date fair value per share |
|
|
Restricted stock |
|
|
|
|
|||
|
Restricted stock |
|
|
|
|
|||
|
Restricted stock |
|
|
|
|
|||
|
Performance based |
|
|
|
|
|||
Pursuant to our directors stock plan
In connection with the vesting of incentive compensation, certain employees have in the past, at their election and when permitted by us, chosen to satisfy their minimum tax withholding obligations through net share settlement, pursuant to which the Company withholds the number of shares necessary to satisfy such withholding obligations and pays the obligations in cash. As a result, in the three and six months ended June 30, 2025, we withheld
Common Stock Dividends
During the first two quarters of 2025, our Board of Directors have declared and we have paid a quarterly dividend of $
16
Accumulated Other Comprehensive (Loss) Income, Net
The following table lists the beginning balance, quarterly activity and ending balances, net of income and mining tax, of each component of “Accumulated other comprehensive income (loss), net” (in thousands):
|
|
Changes in fair value of derivative contracts designated as hedge transactions |
|
|
Adjustments |
|
|
Total |
|
|||
Balance January 1, 2025 |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
Change in fair value of derivative contracts |
|
|
|
|
|
|
|
|
|
|||
Gains and deferred gains transferred from accumulated other comprehensive income |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Balance March 31, 2025 |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
Changes in fair value of derivative contracts |
|
|
|
|
|
|
|
|
|
|||
Gains and deferred gains transferred from accumulated other comprehensive income |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Balance June 30, 2025 |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|||
Balance January 1, 2024 |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Changes in fair value of derivative contracts |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Gains and deferred gains transferred from accumulated other comprehensive income |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Balance March 31, 2024 |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Changes in fair value of derivative contracts |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Gains and deferred gains transferred from accumulated other comprehensive income |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Balance June 30, 2024 |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
Note 7. Debt, Credit Agreement and Leases
Our debt as of June 30, 2025 and December 31, 2024 consisted of our
|
|
June 30, 2025 |
|
|||||||||||||
|
|
Senior Notes |
|
|
IQ Notes |
|
|
Credit Agreement |
|
|
Total |
|
||||
Principal |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Unamortized discount/premium and issuance costs |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Total debt |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Less: current debt |
|
|
|
|
$ |
( |
) |
|
|
|
|
|
( |
) |
||
Long-term debt |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
December 31, 2024 |
|
|||||||||||||
|
|
Senior Notes |
|
|
IQ Notes |
|
|
Credit Agreement |
|
|
Total |
|
||||
Principal |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Unamortized discount/premium and issuance costs |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Total debt |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Less: current debt |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
Long-term debt |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
The following table summarizes the scheduled annual future payments, including interest, for our Senior Notes, IQ Notes, and finance and operating leases as of June 30, 2025 (in thousands). Operating leases are included in other current and non-current liabilities
17
on our condensed consolidated balance sheets. The amounts for the IQ Notes are stated in U.S. dollars (“USD”) based on the USD/Canadian dollar (“CAD”) exchange rate as of June 30, 2025. See Note 13 for more information.
Twelve-month period ending June 30, |
|
Senior Notes |
|
|
IQ Notes |
|
|
Finance Leases |
|
|
Operating Leases |
|
||||
2026 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
2027 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
2028 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
2029 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
2030 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Thereafter |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: effect of discounting |
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
||
Total |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Credit Agreement
On May 3, 2024 we entered into an amended revolving credit agreement with various financial institutions (the "Lenders"), which provided the Company with borrowing capacity up to $
Proceeds of the revolving loans under the Credit Agreement may be used for general corporate purposes. The interest rate on the outstanding loans under the Credit Agreement is based on the Company’s net leverage ratio and is calculated at (i) Term Secured Overnight Financing Rate ("SOFR") plus
We are also required to pay a commitment fee of between
Hecla Mining Company and certain of our subsidiaries are the borrowers under the Credit Agreement, while certain of our other subsidiaries are guarantors of the borrowers’ obligations under the Credit Agreement. As further security, the Credit Agreement is collateralized by a mortgage on the Greens Creek mine, the equity interests of subsidiaries that own the Greens Creek mine or are part of the Greens Creek Joint Venture and our subsidiary Hecla Admiralty Company (the “Greens Creek Group”), and by all of the Greens Creek Group’s rights and interests in the Greens Creek Joint Venture Agreement, and in all assets of the joint venture and of any member of the Greens Creek Group.
At June 30, 2025, we had net draws of $
We believe we were in compliance with all covenants under the Credit Agreement as of June 30, 2025.
Note 8. Derivative Instruments
General
Our current risk management policy provides that up to
These instruments expose us to (i) credit risk in the form of non-performance by counterparties for contracts in which the contract price exceeds the spot price of the hedged commodity or foreign currency and (ii) price risk to the extent that the spot price or currency exchange rate exceeds the contract price for quantities of our production and/or forecasted costs covered under contract positions.
18
Foreign Currency
Our wholly-owned subsidiaries owning the Casa Berardi operation and Keno Hill operation are USD-functional entities which routinely incur expenses denominated in CAD. Such expenses expose us to exchange rate fluctuations, for which we have a program to manage our exposure to fluctuations for these subsidiaries' future operating and capital costs denominated in CAD. The program related to forecasted cash operating costs at Casa Berardi and Keno Hill utilizes forward contracts to buy CAD, and only those related to Casa Berardi are designated as cash flow hedges. As of June 30, 2025, we have a total of
As of June 30, 2025 and December 31, 2024, we recorded the following balances for the fair value of the foreign currency forward contracts (in millions):
|
|
June 30, |
|
|
December 31, |
|
||
Balance sheet line item: |
|
2025 |
|
|
2024 |
|
||
Other current assets |
|
$ |
|
|
$ |
|
||
Other non-current assets |
|
$ |
|
|
$ |
|
||
Other current liabilities |
|
$ |
( |
) |
|
$ |
( |
) |
Other non-current liabilities |
|
$ |
( |
) |
|
$ |
( |
) |
Net unrealized losses of $
Net realized losses of $
Net gains of $
No net unrealized gains or losses related to ineffectiveness of the hedges are included in fair value adjustments, net on our consolidated statements of operations and comprehensive income for the three and six months ended June 30, 2025 and 2024, respectively.
Metals Prices
We are currently using financially-settled forward contracts to manage our exposure to:
The following tables summarize the quantities of metals committed under forward metals contracts at June 30, 2025 and December 31, 2024:
19
June 30, 2025 |
|
Ounces/pounds under contract (in 000's except gold) |
|
|
Average price per ounce/pound |
|
||||||||||||||||||||||||||
|
|
Silver |
|
|
Gold |
|
|
Zinc |
|
|
Lead |
|
|
Silver |
|
|
Gold |
|
|
Zinc |
|
|
Lead |
|
||||||||
|
|
(ounces) |
|
|
(ounces) |
|
|
(pounds) |
|
|
(pounds) |
|
|
(ounces) |
|
|
(ounces) |
|
|
(pounds) |
|
|
(pounds) |
|
||||||||
Contracts on provisional sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
2025 settlements |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
||||||||
Contracts on forecasted sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
2025 settlements |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
N/A |
|
|
N/A |
|
|
$ |
|
|
$ |
|
||||||
2026 settlements |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
N/A |
|
|
N/A |
|
|
$ |
|
|
$ |
|
||||||
December 31, 2024 |
|
Ounces/pounds under contract (in 000's except gold) |
|
|
Average price per ounce/pound |
|
||||||||||||||||||||||||||
|
|
Silver |
|
|
Gold |
|
|
Zinc |
|
|
Lead |
|
|
Silver |
|
|
Gold |
|
|
Zinc |
|
|
Lead |
|
||||||||
|
|
(ounces) |
|
|
(ounces) |
|
|
(pounds) |
|
|
(pounds) |
|
|
(ounces) |
|
|
(ounces) |
|
|
(pounds) |
|
|
(pounds) |
|
||||||||
Contracts on provisional sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
2025 settlements |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Contracts on forecasted sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
2025 settlements |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
N/A |
|
|
N/A |
|
|
$ |
|
|
$ |
|
||||||
2026 settlements |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
N/A |
|
|
N/A |
|
|
$ |
|
|
$ |
|
||||||
Since the first quarter of 2025, we have and continue to utilize financially-settled zero cost collars ("collars") to manage our exposure to changes in the price of silver contained in both our provisional and forecasted Keno Hill future concentrate shipments. These collars provide us a contractual right to receive at least the minimum price if market prices fall below this level, while limiting our potential gains to the maximum price under the collars, even if market prices rise higher. This strategy helps protect us from significant price drops while still allowing for some upside potential within this range. For the three and six months ended June 30, 2025, these collars had net losses of $
Settlement Period |
|
Production Protected |
|
|
Minimum Price |
|
|
Maximum Price |
|
|||
|
|
(ounces) |
|
|
($) |
|
|
($) |
|
|||
Contracts on provisional sales |
|
|
|
|
|
|
|
|
|
|||
2025 settlements |
|
|
|
|
|
|
|
|
|
|||
Contracts on forecasted sales |
|
|
|
|
|
|
|
|
|
|||
2025 settlements |
|
|
|
|
|
|
|
|
|
|||
2026 settlements |
|
|
|
|
|
|
|
|
|
|||
We recorded the following balances for the fair value of the forward metals and collar contracts as of June 30, 2025 and December 31, 2024 (in millions):
|
|
June 30, |
|
|
December 31, |
|
||
Balance sheet line item: |
|
2025 |
|
|
2024 |
|
||
Other current assets |
|
$ |
|
|
$ |
|
||
Other non-current assets |
|
$ |
|
|
$ |
|
||
Other current liabilities |
|
$ |
( |
) |
|
$ |
|
|
Other non-current liabilities |
|
$ |
|
|
$ |
|
||
Net realized and unrealized gains of $
We recognized a net gain of $
20
These gains and losses were recognized on the contracts utilized to manage exposure to prices of metals in our concentrate shipments, which are included in sales. The net losses and gains recognized on the contracts offset gains and losses related to price adjustments on our provisional concentrate sales due to changes to silver, gold, lead and zinc prices between the time of sale and final settlement.
Credit-risk-related Contingent Features
Certain of our derivative contracts contain cross default provisions which provide that a default under our Credit Agreement would cause a default under the derivative contract. As of June 30, 2025, we have not posted any collateral related to these contracts. The fair value of derivatives in a net liability position related to these agreements was $
Note 9. Fair Value Measurement
Fair value adjustments, net is comprised of the following (in thousands):
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Gain (loss) on derivative contracts |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total fair value adjustments, net |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Accounting guidance has established a hierarchy for inputs used to measure assets and liabilities at fair value on a recurring basis. The three levels included in the hierarchy are:
Level 1: quoted prices in active markets for identical assets or liabilities;
Level 2: significant other observable inputs; and
Level 3: significant unobservable inputs.
The table below sets forth our assets and liabilities that were accounted for at fair value on a recurring basis and the fair value calculation input hierarchy level that we have determined applies to each asset and liability category (in thousands).
Description |
|
Balance at |
|
|
Balance at |
|
|
Input |
||
Assets: |
|
|
|
|
|
|
|
|
||
Cash and cash equivalents: |
|
|
|
|
|
|
|
|
||
Money market funds and other bank deposits |
|
$ |
|
|
$ |
|
|
Level 1 |
||
Current and non-current investments: |
|
|
|
|
|
|
|
|
||
Equity securities |
|
|
|
|
|
|
|
Level 1 |
||
Trade accounts receivable: |
|
|
|
|
|
|
|
|
||
Receivables from provisional concentrate sales |
|
|
|
|
|
|
|
Level 2 |
||
Restricted cash and cash equivalent balances: |
|
|
|
|
|
|
|
|
||
Certificates of deposit and other deposits |
|
|
|
|
|
|
|
Level 1 |
||
Derivative contracts - current and non-current derivative assets: |
|
|
|
|
|
|
|
|
||
Foreign exchange contracts |
|
|
|
|
|
|
|
Level 2 |
||
|
|
|
|
|
|
|
Level 2 |
|||
|
|
|
|
|
|
|
|
|
||
Liabilities: |
|
|
|
|
|
|
|
|
||
Derivative contracts - current and non-current derivative liabilities: |
|
|
|
|
|
|
|
|
||
Foreign exchange contracts |
|
$ |
|
|
$ |
|
|
Level 2 |
||
Metal forward contracts |
|
|
|
|
|
|
|
Level 2 |
||
Cash and cash equivalents consist primarily of money market funds and are valued at cost, which approximates fair value.
Current and non-current restricted cash and cash equivalent balances consist primarily of certificates of deposit, U.S. Treasury securities, and other deposits and are valued at cost, which approximates fair value.
21
Our non-current investments consist of marketable equity securities of mining companies which are valued using quoted market prices for each security.
Trade accounts receivable from provisional concentrate sales are subject to final pricing and valued using quoted prices based on forward curves for the particular metals.
We use financially-settled forward contracts to manage exposure to changes in the exchange rate between USD and CAD, and the impact on CAD-denominated operating and capital costs incurred at our Casa Berardi and Keno Hill operations (see Note 8 for more information). The fair value of each contract represents the present value of the difference between the forward exchange rate for the contract settlement period as of the measurement date and the contract settlement exchange rate.
We use financially-settled forward contracts to manage the exposure to changes in prices of silver, gold, zinc and lead contained in our concentrate shipments that have not reached final settlement. We also use financially-settled forward contracts to manage the exposure to changes in prices of gold, zinc and lead contained in our forecasted future sales (see Note 8 for more information). The fair value of each forward contract represents the present value of the difference between the forward metal price for the contract settlement period as of the measurement date and the contract settlement metal price.
At June 30, 2025, our Senior Notes and IQ Notes were recorded at their carrying value of $
Note 10. Product Inventories
Our major components of product inventories are (in thousands):
|
|
June 30, 2025 |
|
|
December 31, 2024 |
|
||
Concentrates |
|
$ |
|
|
$ |
|
||
Stockpiled ore |
|
|
|
|
|
|
||
In-process |
|
|
|
|
|
|
||
Total product inventories |
|
$ |
|
|
$ |
|
||
Note 11. Commitments, Contingencies and Obligations
San Mateo Creek Basin, New Mexico
In July 2018, the Environmental Protection Agency ("EPA") informed Hecla Limited that it and several other potentially responsible parties (“PRPs”) may be liable for cleanup of the San Mateo Creek Basin (“SMCB”), which is an approximately 321 square mile area in New Mexico that contains numerous legacy uranium mines and mills. At the time, the EPA stated it had incurred approximately $
Carpenter Snow Creek and Barker-Hughesville Sites in Montana
In July 2010, the EPA made a formal request to Hecla for information regarding the Carpenter Snow Creek Superfund site located in Cascade County, Montana. The Carpenter Snow Creek site is located in a historical mining district, and in the early 1980s Hecla Limited leased 6 mining claims and performed limited exploration activities at the site. Hecla Limited terminated the mining lease in 1988.
In June 2011, the EPA informed Hecla Limited that it believes Hecla Limited, and several other PRPs, may be liable for cleanup of the site or for costs incurred by the EPA in cleaning up the site. The EPA stated in the letter that it has incurred approximately $
22
certainty estimate the amount or range of liability, if any, relating to this matter because of, among other reasons, the lack of information concerning the site, including the relative contributions of contamination by various other PRPs.
In February 2017, the EPA made a formal request to Hecla for information regarding the Barker-Hughesville Mining District Superfund site located in Judith Basin and Cascade Counties, Montana. Hecla Limited submitted a response in April 2017. The Barker-Hughesville site is located in a historic mining district, and between approximately June and December 1983, Hecla Limited was party to an agreement with another mining company under which limited exploration activities occurred at or near the site.
In August 2018, the EPA informed Hecla Limited that it and several other PRPs may be liable for cleanup of the site or for costs incurred by the EPA in cleaning up the site. The EPA did not include an amount of its alleged response costs to date. Hecla Limited cannot with reasonable certainty estimate the amount or range of liability, if any, relating to this matter because of, among other reasons, the lack of information concerning past or anticipated future costs at the site and the relative contributions of contamination by various other PRPs.
Debt
See Note 7 for information on the commitments related to our debt arrangements as of June 30, 2025.
Indirect Taxes
In May 2024, our Keno Hill subsidiary received a notice of assessment ("NOA") for goods and services tax ("GST") on its 2023 sales for CAD $
Other Commitments
Our contractual obligations as of June 30, 2025 included open purchase orders and commitments of $
Other Contingencies
We also have certain other contingencies resulting from litigation, claims, EPA investigations, and other commitments and are subject to a variety of environmental and safety laws and regulations incident to the ordinary course of business. We currently have no basis to conclude that any or all of such contingencies will materially affect our financial position, results of operations or cash flows. However, in the future, there may be changes to these contingencies, or additional contingencies may occur, any of which might result in an accrual or a change in current accruals recorded by us, and there can be no assurance that their ultimate disposition will not have a material adverse effect on our financial position, results of operations or cash flows.
Note 12. Recent Accounting Pronouncements
Accounting Standards Updates to Become Effective in Future Periods
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024 and are applied prospectively. Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the impact of this update on our consolidated financial statements and disclosures.
23
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income (Topic 220): Expense Disaggregation Disclosures, which includes amendments to require the disclosure of certain specific costs and expenses that are included in a relevant expense caption on the face of the income statement. Specific costs and expenses that would be required to be disclosed include: purchases of inventory, employee compensation, depreciation and intangible asset amortization. Additionally, a qualitative description of other items is required, equal to the difference between the relevant expense caption and the separately disclosed specific costs. The amendments in ASU 2024-03 are effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, and are applied either prospectively or retrospectively at the option of the Company. We are evaluating the impact of the amendments on our consolidated financial statements and disclosures.
Note 13. Subsequent Events
ATM Equity Distribution Agreement
Subsequent to June 30, 2025, the Company sold an additional
IQ Notes
On July 9, 2025, the Company fully repaid the IQ notes, including interest, for $
Dismissal of Litigation related to Klondex Acquisition
On July 17, 2025, the United States Court of Appeals for the Second Circuit.affirmed the district court’s decision to dismiss a putative class action lawsuit filed against Hecla and certain of our executive officers and directors in 2019 concerning certain public disclosures made about our Nevada assets in 2018 and 2019. We expect this to be the end of this matter. The plaintiffs in the related derivative lawsuit pending in Delaware Chancery Court have voluntarily sought to dismiss the lawsuit.
Issued Notice to Redeem Portion of 7.25% Senior Notes Due February 15, 2028
On August 1, 2025, we issued a notice of redemption to the trustee to redeem $
24
Forward-Looking Statements
Certain statements contained in this Form 10-Q, including in Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk, are intended to be covered by the safe harbor provided for under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Our forward-looking statements include our current expectations and projections about future results, performance, results of litigation, prospects and opportunities, including reserves and other mineralization. We have tried to identify these forward-looking statements by using words such as “may,” “will,” “expect,” “anticipate,” “believe,” “intend,” “feel,” “plan,” “estimate,” “project,” “forecast” and similar expressions. These forward-looking statements are based on information currently available to us and are expressed in good faith and believed to have a reasonable basis. However, our forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause our actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements.
These risks, uncertainties and other factors include, but are not limited to, those set forth under Part II, Item 1A. – Risk Factors of this Form 10-Q and Part I, Item 1A. – Risk Factors in our 2024 Form 10-K. Given these risks and uncertainties, readers are cautioned not to place undue reliance on our forward-looking statements. All subsequent written and oral forward-looking statements attributable to Hecla Mining Company or to persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Except as required by federal securities laws, we do not intend to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
25
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
In this Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”), “Hecla,” “the Company,” “we,” “us” and “our” refer to Hecla Mining Company and its consolidated subsidiaries, except where the context requires otherwise. You should read this discussion in conjunction with our consolidated financial statements, the related MD&A and the discussion of our Business and Properties for the year ended December 31, 2024, filed with the United States Securities and Exchange Commission (the “SEC”). The results of operations reported and summarized below are not necessarily indicative of future operating results (refer to “Forward-Looking Statements” above for further discussion). References to “Notes” are Notes included in our Notes to Condensed Consolidated Financial Statements (Unaudited). Throughout this MD&A, all references to income or losses per share are on a diluted basis.
Overview
Hecla Mining Company stands as North America's leading silver producer, with a rich heritage dating back to 1891. Our operations at Greens Creek, Lucky Friday and Keno Hill combined to produce 35% of 2024 silver production in the U.S. and Canada, complemented by significant gold production from Casa Berardi and Greens Creek. We began ramp-up of the Keno Hill mill during the second quarter of 2023 after acquiring it in September 2022. Our strategic positioning in the stable jurisdictions of U.S. and Canada provides us with distinct operational advantages and reduced political risk compared to our global peers. Our operational and strategic framework centers on four core pillars:
Second Quarter 2025 Highlights
Operational Achievements:
Financial Performance:
Exploration:
26
Year to date 2025 Highlights
Operational Achievements:
Financial Performance:
External Factors that Impact our Results
Our financial results vary as a result of fluctuations in market prices primarily for silver and gold and, to a lesser extent, zinc, lead and copper. World market prices for these commodities have fluctuated historically and are affected by numerous factors beyond our control. Although we have not been materially impacted to date, our financial results could in the future be materially impacted by the introduction of tariffs and other global restraints on trade. Historically our US operations have had significant sales into China and Canada, and each of those countries is or could be subject to tariffs, and each has or may retaliate in kind. Notwithstanding these recent developments, we believe that the outlook for precious metals fundamentals in the medium- and long-term is favorable due to macro-economic factors such as lower interest rate expectations, geopolitical uncertainty and global growth expectations, which have resulted in significant volatility in the financial and commodities markets, including the precious metals market. See Part II, Item 1A. “Risk Factors” of this Form 10-Q and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024 ("2024 Form 10-K"), for further discussion. Because we cannot control the price of our products, except to the extent we have entered into hedging transactions, the key measures that management focuses on in operating our business are production volumes, payable sales volumes, Cash Cost, After By-product Credits, per Ounce (non-GAAP) and All-In Sustaining Cost, After By-product Credits, per Ounce (“AISC”) (non-GAAP), operating cash flows, capital expenditures, free cash flow (non-GAAP) and adjusted EBITDA (non-GAAP). The average realized prices for all metals sold by us continued to exhibit significant volatility during the period. We have also experienced significant cost inflation across our operations, principally associated with higher energy prices, increased costs for other consumables such as reagents, explosives and steel, and higher labor and contractor costs.
Consolidated Results of Operations
Total sales for the three and six months ended June 30, 2025 and 2024 were as follows:
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
(in thousands) |
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Silver |
|
$ |
122,661 |
|
|
$ |
112,692 |
|
|
$ |
240,814 |
|
|
$ |
198,925 |
|
Gold |
|
|
123,721 |
|
|
|
82,469 |
|
|
|
210,909 |
|
|
|
149,884 |
|
Lead |
|
|
21,476 |
|
|
|
23,928 |
|
|
|
43,582 |
|
|
|
43,411 |
|
Zinc |
|
|
31,138 |
|
|
|
32,496 |
|
|
|
64,263 |
|
|
|
57,460 |
|
Copper |
|
|
979 |
|
|
|
— |
|
|
|
1,370 |
|
|
|
— |
|
Less: Smelter and refining charges |
|
|
(2,544 |
) |
|
|
(9,282 |
) |
|
|
(9,256 |
) |
|
|
(22,296 |
) |
Total metal sales |
|
|
297,431 |
|
|
|
242,303 |
|
|
|
551,682 |
|
|
|
427,384 |
|
Environmental remediation services |
|
|
6,596 |
|
|
|
3,354 |
|
|
|
13,684 |
|
|
|
7,801 |
|
Total sales |
|
$ |
304,027 |
|
|
$ |
245,657 |
|
|
$ |
565,366 |
|
|
$ |
435,185 |
|
Environmental remediation services revenue is generated by performing remediation work in the historical Yukon Territory mining district on behalf of the Canadian government. The scope and estimated cost of all work is agreed to in advance by the Canadian government, and the expenses incurred are essentially passed through to the government for reimbursement with minimal margin generated by us in performing this work.
27
Total metal sales for the three and six months ended June 30, 2025 and 2024, and the approximate variances attributed to differences in metals prices, sales volumes and smelter terms, were as follows:
(in thousands) |
|
Silver |
|
|
Gold |
|
|
Base metals |
|
|
Less: smelter and refining charges |
|
|
Total sales of products |
|
|||||
Three months ended June 30, 2024 |
|
$ |
112,692 |
|
|
$ |
82,469 |
|
|
$ |
56,424 |
|
|
$ |
(9,282 |
) |
|
$ |
242,303 |
|
Variances - 2025 versus 2024: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Price |
|
|
16,775 |
|
|
|
36,976 |
|
|
|
(9,156 |
) |
|
|
— |
|
|
|
44,595 |
|
Volume |
|
|
(6,806 |
) |
|
|
4,276 |
|
|
|
6,325 |
|
|
|
(772 |
) |
|
|
3,023 |
|
Smelter terms |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7,510 |
|
|
|
7,510 |
|
Three months ended June 30, 2025 |
|
$ |
122,661 |
|
|
$ |
123,721 |
|
|
$ |
53,593 |
|
|
$ |
(2,544 |
) |
|
$ |
297,431 |
|
(in thousands) |
|
Silver |
|
|
Gold |
|
|
Base metals |
|
|
Less: smelter and refining charges |
|
|
Total sales of products |
|
|||||
Six months ended June 30, 2024 |
|
$ |
198,925 |
|
|
$ |
149,884 |
|
|
$ |
100,871 |
|
|
$ |
(22,296 |
) |
|
$ |
427,384 |
|
Variances - 2025 versus 2024: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Price |
|
|
47,884 |
|
|
|
62,082 |
|
|
|
(5,227 |
) |
|
|
— |
|
|
|
104,739 |
|
Volume |
|
|
(5,995 |
) |
|
|
(1,057 |
) |
|
|
13,571 |
|
|
|
— |
|
|
|
6,519 |
|
Smelter terms |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
13,040 |
|
|
|
13,040 |
|
Six months ended June 30, 2025 |
|
$ |
240,814 |
|
|
$ |
210,909 |
|
|
$ |
109,215 |
|
|
$ |
(9,256 |
) |
|
$ |
551,682 |
|
The fluctuation in sales for the three and six months ended June 30, 2025 compared to the same periods in 2024 was primarily due to the following:
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Silver – |
|
London PM Fix ($/ounce) |
|
$ |
33.63 |
|
|
$ |
28.86 |
|
|
$ |
32.77 |
|
|
$ |
26.11 |
|
|
|
AG真人官方ized price per ounce |
|
$ |
34.82 |
|
|
$ |
29.77 |
|
|
$ |
34.20 |
|
|
$ |
27.37 |
|
Gold – |
|
London PM Fix ($/ounce) |
|
$ |
3,279 |
|
|
$ |
2,338 |
|
|
$ |
3,071 |
|
|
$ |
2,205 |
|
|
|
AG真人官方ized price per ounce |
|
$ |
3,314 |
|
|
$ |
2,338 |
|
|
$ |
3,148 |
|
|
$ |
2,222 |
|
Lead – |
|
LME Final Cash Buyer ($/pound) |
|
$ |
0.88 |
|
|
$ |
0.98 |
|
|
$ |
0.89 |
|
|
$ |
0.96 |
|
|
|
AG真人官方ized price per pound |
|
$ |
0.92 |
|
|
$ |
1.06 |
|
|
$ |
0.92 |
|
|
$ |
1.02 |
|
Zinc – |
|
LME Final Cash Buyer ($/pound) |
|
$ |
1.20 |
|
|
$ |
1.29 |
|
|
$ |
1.24 |
|
|
$ |
1.20 |
|
|
|
AG真人官方ized price per pound |
|
$ |
1.31 |
|
|
$ |
1.51 |
|
|
$ |
1.31 |
|
|
$ |
1.30 |
|
Copper – |
|
LME Final Cash Buyer ($/pound) |
|
$ |
4.32 |
|
|
$ |
— |
|
|
$ |
4.28 |
|
|
$ |
— |
|
|
|
AG真人官方ized price per pound |
|
$ |
4.56 |
|
|
$ |
— |
|
|
$ |
4.52 |
|
|
$ |
— |
|
Average realized prices typically differ from average market prices primarily because concentrate sales are generally recorded as revenues at the time of shipment at forward prices for the estimated month of settlement, which differ from average market prices. Due to the time elapsed between shipment of concentrates and final settlement with the customers, we must estimate the prices at which sales of our metals will be settled. Previously recorded sales are adjusted to estimated settlement metals prices each period through final settlement. We recorded net positive price adjustments to provisional settlements of $4.2 million and $11.0 million for the three months ended June 30, 2025 and 2024, and $11.1 million and $14.5 million for the six months ended June 30, 2025 and 2024, respectively. The price adjustments related to silver, gold, zinc, lead and copper contained in our concentrate shipments were partially offset by gains and losses on forward contracts for those metals. See Note 8 of Notes to Condensed Consolidated Financial Statements (Unaudited) for more information. The gains and losses on these contracts are included in revenues and impact the realized prices for silver, gold, lead, zinc and copper. AG真人官方ized prices are calculated by dividing gross revenues for each metal (which include the price adjustments and gains and losses on the forward contracts discussed above) by the payable quantities of each metal included in concentrate, doré and carbon material shipped during the period.
28
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Silver - |
|
Ounces produced |
|
|
4,520,510 |
|
|
|
4,458,484 |
|
|
|
8,632,904 |
|
|
|
8,650,582 |
|
|
|
Payable ounces sold |
|
|
3,522,975 |
|
|
|
3,785,285 |
|
|
|
7,040,945 |
|
|
|
7,267,169 |
|
Gold - |
|
Ounces produced |
|
|
45,895 |
|
|
|
37,324 |
|
|
|
80,127 |
|
|
|
73,916 |
|
|
|
Payable ounces sold |
|
|
37,333 |
|
|
|
35,276 |
|
|
|
66,988 |
|
|
|
67,465 |
|
Lead - |
|
Tons produced |
|
|
14,650 |
|
|
|
13,587 |
|
|
|
28,657 |
|
|
|
25,686 |
|
|
|
Payable tons sold |
|
|
11,663 |
|
|
|
11,338 |
|
|
|
23,653 |
|
|
|
21,359 |
|
Zinc - |
|
Tons produced |
|
|
18,479 |
|
|
|
16,191 |
|
|
|
35,414 |
|
|
|
32,402 |
|
|
|
Payable tons sold |
|
|
11,667 |
|
|
|
10,781 |
|
|
|
24,514 |
|
|
|
22,102 |
|
Copper |
|
Tons produced |
|
|
499 |
|
|
|
462 |
|
|
|
910 |
|
|
|
957 |
|
|
|
Payable tons sold |
|
|
108 |
|
|
|
— |
|
|
|
152 |
|
|
|
— |
|
The difference between what we report as “ounces/tons produced” and “payable ounces/tons sold” is attributable to the difference between the quantities of metals contained in the concentrates we produce versus the portion of those metals actually paid for by our customers according to the terms of our sales contracts. Differences can also arise from inventory changes incidental to shipping schedules, or variances in ore grades which impact the amount of metals contained in concentrates produced and sold.
Sales, total cost of sales, gross profit (loss), Cash Cost, After By-product Credits, per Ounce (“Cash Cost”) (non-GAAP) and AISC (non-GAAP) at our operating segments for the three and six months ended June 30, 2025 and 2024 were as follows (in thousands, except for Cash Cost and AISC):
|
|
Silver |
|
Gold and Other |
||||||||||
|
|
Greens Creek |
|
Lucky Friday |
|
Keno Hill |
|
Total Silver (2) |
|
Casa Berardi |
|
Other (3) |
|
Total Gold and Other |
Three Months Ended June 30, 2025: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
|
$122,002 |
|
$64,273 |
|
$26,121 |
|
$212,396 |
|
$85,035 |
|
$6,596 |
|
$91,631 |
Total cost of sales |
|
(58,921) |
|
(42,286) |
|
(25,881) |
|
(127,088) |
|
(50,790) |
|
$(6,625) |
|
(57,415) |
Gross profit (loss) |
|
$63,081 |
|
$21,987 |
|
$240 |
|
$85,308 |
|
$34,245 |
|
$(29) |
|
$34,216 |
Cash Cost (1) |
|
$(11.91) |
|
$6.19 |
|
$— |
|
$(5.46) |
|
$1,578 |
|
$— |
|
$1,578 |
AISC (1) |
|
$(8.19) |
|
$19.07 |
|
$— |
|
$5.19 |
|
$1,669 |
|
$— |
|
$1,669 |
Three Months Ended June 30, 2024: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
|
$95,659 |
|
$59,071 |
|
$28,950 |
|
$183,680 |
|
$58,623 |
|
$3,354 |
|
$61,977 |
Total cost of sales |
|
(56,786) |
|
(37,523) |
|
(28,950) |
|
(123,259) |
|
(67,340) |
|
(3,628) |
|
(70,968) |
Gross profit (loss) |
|
$38,873 |
|
$21,548 |
|
$— |
|
$60,421 |
|
$(8,717) |
|
$(274) |
|
$(8,991) |
Cash Cost (1) |
|
$0.19 |
|
$5.32 |
|
$— |
|
$2.08 |
|
$1,701 |
|
$— |
|
$1,701 |
AISC (1) |
|
$5.40 |
|
$12.74 |
|
$— |
|
$12.54 |
|
$1,825 |
|
$— |
|
$1,825 |
29
|
|
Silver |
|
|
Gold |
|
||||||||||||||||||||||
|
|
Greens Creek |
|
|
Lucky Friday |
|
|
Keno Hill |
|
|
Total Silver (2) |
|
|
Casa Berardi |
|
|
Other (3) |
|
|
Total Gold |
|
|||||||
Six Months Ended June 30, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Sales |
|
$ |
240,145 |
|
|
$ |
127,467 |
|
|
$ |
43,030 |
|
|
$ |
410,642 |
|
|
$ |
141,040 |
|
|
$ |
13,684 |
|
|
$ |
154,724 |
|
Total cost of sales |
|
|
(128,559 |
) |
|
|
(86,335 |
) |
|
|
(41,752 |
) |
|
|
(256,646 |
) |
|
|
(101,472 |
) |
|
|
(13,720 |
) |
|
|
(115,192 |
) |
Gross profit (loss) |
|
$ |
111,586 |
|
|
$ |
41,132 |
|
|
$ |
1,278 |
|
|
$ |
153,996 |
|
|
$ |
39,568 |
|
|
$ |
(36 |
) |
|
$ |
39,532 |
|
Cash Cost (1) |
|
$ |
(8.37 |
) |
|
$ |
7.77 |
|
|
$ |
— |
|
|
$ |
(2.29 |
) |
|
$ |
1,837 |
|
|
$ |
— |
|
|
$ |
1,837 |
|
AISC (1) |
|
$ |
(4.50 |
) |
|
$ |
19.57 |
|
|
$ |
— |
|
|
$ |
8.35 |
|
|
$ |
1,935 |
|
|
$ |
— |
|
|
$ |
1,935 |
|
Six Months Ended June 30, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Sales |
|
$ |
192,969 |
|
|
$ |
94,411 |
|
|
$ |
39,797 |
|
|
$ |
327,177 |
|
|
$ |
100,207 |
|
|
$ |
7,801 |
|
|
|
108,008 |
|
Total cost of sales |
|
|
(126,643 |
) |
|
|
(65,042 |
) |
|
|
(39,797 |
) |
|
|
(231,482 |
) |
|
|
(125,600 |
) |
|
|
(7,513 |
) |
|
|
(133,113 |
) |
Gross profit (loss) |
|
$ |
66,326 |
|
|
$ |
29,369 |
|
|
$ |
— |
|
|
$ |
95,695 |
|
|
$ |
(25,393 |
) |
|
$ |
288 |
|
|
$ |
(25,105 |
) |
Cash Cost (1) |
|
$ |
1.90 |
|
|
$ |
6.67 |
|
|
$ |
— |
|
|
$ |
3.38 |
|
|
$ |
1,685 |
|
|
$ |
— |
|
|
$ |
1,685 |
|
AISC (1) |
|
$ |
6.33 |
|
|
$ |
14.50 |
|
|
$ |
— |
|
|
$ |
12.81 |
|
|
$ |
1,861 |
|
|
$ |
— |
|
|
$ |
1,861 |
|
While revenue from zinc, lead, copper and gold by-products is significant, we believe that identification of silver as the primary product of Greens Creek, Lucky Friday and Keno Hill is appropriate because:
Accordingly, we believe the identification of gold, lead, zinc and copper as by-product credits at Greens Creek, Lucky Friday and Keno Hill is appropriate because of their lower economic value compared to silver and due to the fact that silver is the primary product we intend to produce at those locations. In addition, we have not consistently received sufficient revenue from any single by-product metal to warrant classification of such as a co-product.
We periodically review our revenues to ensure that reporting of primary products and by-products is appropriate. Because for Greens Creek, Lucky Friday and Keno Hill we consider zinc, lead, gold and copper to be by-products of our silver production, the values of these metals offset operating costs within our calculations of Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce. We currently do not report Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce for our Keno Hill operation as it is in the production ramp-up phase and has not met our definition of commercial production. We define an operation as being in commercial production upon achievement of the following criteria:
30
Currently we meet only one of the above criteria - silver recoveries are at expected steady-state production levels. Determination of when these criteria have been met requires the use of judgment, and our definition of commercial production may differ from that of other mining companies.
As Keno Hill has not yet been determined to be in commercial production, its costs and by-product credits are excluded from our consolidated Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce because (i) by definition it has not reached the sustaining stage and (ii) including its costs and by-product credits we believe would distort consolidated Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce of our operating silver mines that are in commercial production and operating as designed, and would not facilitate a meaningful comparison of our performance versus that of our peers who do not report such metrics for mines that are not in commercial production.
We believe the identification of silver as a by-product credit is appropriate at Casa Berardi because of its lower economic value compared to gold and due to the fact that gold is the primary product we produce there. In addition, we do not receive sufficient revenue from silver at the Casa Berardi mine to warrant classification of such as a co-product. Because we consider silver to be a by-product of our gold production at Casa Berardi, the value of silver offsets operating costs within our calculations of Cash Cost, After By-product Credits, per Gold Ounce and AISC, After By-product Credits, per Gold Ounce.
We reported net income applicable to common stockholders of $57.6 million for the three months ended June 30, 2025, compared to a net income applicable to common stockholders of $27.7 million in the comparable period in 2024. The following were the significant drivers of the change:
The positive movements mentioned above were partly offset by:
We reported net income applicable to common stockholders of $86.3 million for the six months ended June 30, 2025, compared to a net income applicable to common stockholders of $21.8 million in the comparable period in 2024. The following were the significant drivers of the change:
The positive movements mentioned above were partly offset by:
31
32
Greens Creek
Dollars are in thousands (except per ounce and per ton amounts) |
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Sales |
|
$ |
122,002 |
|
|
$ |
95,659 |
|
|
$ |
240,145 |
|
|
$ |
192,969 |
|
Cost of sales and other direct production costs |
|
|
(46,024 |
) |
|
|
(45,470 |
) |
|
|
(102,073 |
) |
|
|
(100,884 |
) |
Depreciation, depletion and amortization |
|
|
(12,897 |
) |
|
|
(11,316 |
) |
|
|
(26,486 |
) |
|
|
(25,759 |
) |
Total cost of sales |
|
|
(58,921 |
) |
|
|
(56,786 |
) |
|
|
(128,559 |
) |
|
|
(126,643 |
) |
Gross profit |
|
$ |
63,081 |
|
|
$ |
38,873 |
|
|
$ |
111,586 |
|
|
$ |
66,326 |
|
Tons of ore milled |
|
|
230,221 |
|
|
|
225,746 |
|
|
|
443,120 |
|
|
|
457,934 |
|
Production: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Silver (ounces) |
|
|
2,422,978 |
|
|
|
2,243,551 |
|
|
|
4,425,538 |
|
|
|
4,722,145 |
|
Gold (ounces) |
|
|
17,750 |
|
|
|
14,137 |
|
|
|
31,509 |
|
|
|
28,725 |
|
Lead (tons) |
|
|
4,931 |
|
|
|
4,513 |
|
|
|
9,427 |
|
|
|
9,347 |
|
Zinc (tons) |
|
|
14,024 |
|
|
|
12,400 |
|
|
|
26,859 |
|
|
|
25,462 |
|
Copper (tons) |
|
|
499 |
|
|
|
462 |
|
|
|
910 |
|
|
|
957 |
|
Payable metal quantities sold: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Silver (ounces) |
|
|
1,591,745 |
|
|
|
1,576,918 |
|
|
|
3,336,397 |
|
|
|
3,667,367 |
|
Gold (ounces) |
|
|
11,634 |
|
|
|
10,312 |
|
|
|
22,112 |
|
|
|
22,498 |
|
Lead (tons) |
|
|
2,862 |
|
|
|
2,890 |
|
|
|
6,183 |
|
|
|
6,560 |
|
Zinc (tons) |
|
|
9,039 |
|
|
|
7,525 |
|
|
|
18,546 |
|
|
|
17,089 |
|
Copper (tons) |
|
|
108 |
|
|
|
— |
|
|
|
152 |
|
|
|
— |
|
Ore grades: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Silver ounces per ton |
|
|
13.4 |
|
|
|
12.6 |
|
|
|
12.6 |
|
|
|
13.0 |
|
Gold ounces per ton |
|
|
0.10 |
|
|
|
0.09 |
|
|
|
0.10 |
|
|
|
0.09 |
|
Lead percent |
|
|
2.6 |
% |
|
|
2.5 |
% |
|
|
2.6 |
% |
|
|
2.5 |
% |
Zinc percent |
|
|
6.9 |
% |
|
|
6.2 |
% |
|
|
6.8 |
% |
|
|
6.2 |
% |
Copper percent |
|
|
0.3 |
% |
|
|
0.3 |
% |
|
|
0.3 |
% |
|
|
0.3 |
% |
Total production cost per ton |
|
$ |
225.71 |
|
|
$ |
218.09 |
|
|
$ |
232.57 |
|
|
$ |
215.46 |
|
Cash Cost, After By-product Credits, per Silver Ounce (1) |
|
$ |
(11.91 |
) |
|
$ |
0.19 |
|
|
$ |
(8.37 |
) |
|
$ |
1.90 |
|
AISC, After By-Product Credits, per Silver Ounce (1) |
|
$ |
(8.19 |
) |
|
$ |
5.40 |
|
|
$ |
(4.50 |
) |
|
$ |
6.33 |
|
Capital additions |
|
$ |
8,397 |
|
|
$ |
11,704 |
|
|
$ |
19,156 |
|
|
$ |
20,531 |
|
The $24.2 million increase in gross profit for the three months ended June 30, 2025, compared to the same period in 2024 was primarily due to higher realized sales prices for silver and gold, in addition to higher sales volumes for all metals, except lead.
Capital additions in the current quarter were $3.3 million lower than the prior year period and included $2.8 million for primary ore access development, $2.0 million for mine development and $1.8 million for mining equipment and related costs.
Production of all metals increased during the three months ended June 30, 2025, primarily due to a combination of higher tons milled and higher grades.
The $45.3 million increase in gross profit for the six months ended June 30, 2025, compared to the same period in 2024 was primarily due to higher realized sales prices for silver, gold and lead, partially offset by lower metals sales volumes for all metals, except zinc.
Capital additions during the year were $1.4 million lower than the prior year period and included $6.0 million for primary ore access development, $3.4 million for mine development, $2.8 million for mining equipment and $1.7 million for definition drilling.
Silver production during the six months ended June 30, 2025, declined primarily due to a combination of lower tons milled reflecting a combination of lower heading availability, long hole mining and lower grade ore during the first quarter of 2025 which outweighed an improvement in silver production during the second quarter of 2025. Production of gold, lead and zinc are higher during the current year primarily due to higher grades.
33
The charts below illustrate the factors contributing to Cash Cost, After By-product Credits, per Silver Ounce for Greens Creek:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Cash Cost, Before By-product Credits, per Silver Ounce |
|
$ |
22.42 |
|
|
$ |
25.83 |
|
|
$ |
25.15 |
|
|
$ |
25.46 |
|
By-product credits |
|
|
(34.33 |
) |
|
|
(25.64 |
) |
|
|
(33.52 |
) |
|
|
(23.56 |
) |
Cash Cost, After By-product Credits, per Silver Ounce |
|
$ |
(11.91 |
) |
|
$ |
0.19 |
|
|
$ |
(8.37 |
) |
|
$ |
1.90 |
|
34
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
AISC, Before By-product Credits, per Silver Ounce |
|
$ |
26.14 |
|
|
$ |
31.04 |
|
|
$ |
29.02 |
|
|
$ |
29.89 |
|
By-product credits |
|
|
(34.33 |
) |
|
|
(25.64 |
) |
|
|
(33.52 |
) |
|
|
(23.56 |
) |
AISC, After By-product Credits, per Silver Ounce |
|
$ |
(8.19 |
) |
|
$ |
5.40 |
|
|
$ |
(4.50 |
) |
|
$ |
6.33 |
|
For the three months ended June 30, 2025, the decrease in Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce was primarily due to an increase in gold by-product credits, reflecting higher realized gold prices and higher silver production.
For the six months ended June 30, 2025, the decrease in Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce was primarily due to an increase in gold by-product credits, reflecting higher realized gold prices, partly offset by lower silver production. AISC, After By-product Credits, per Silver Ounce also benefited from lower sustaining capital expenditures.
Lucky Friday
Dollars are in thousands (except per ounce and per ton amounts) |
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Sales |
|
$ |
64,273 |
|
|
$ |
59,071 |
|
|
$ |
127,467 |
|
|
$ |
94,411 |
|
Cost of sales and other direct production costs |
|
|
(29,011 |
) |
|
|
(26,815 |
) |
|
|
(59,635 |
) |
|
|
(46,423 |
) |
Depreciation, depletion and amortization |
|
|
(13,275 |
) |
|
|
(10,708 |
) |
|
|
(26,700 |
) |
|
|
(18,619 |
) |
Total cost of sales |
|
|
(42,286 |
) |
|
|
(37,523 |
) |
|
|
(86,335 |
) |
|
|
(65,042 |
) |
Gross profit |
|
$ |
21,987 |
|
|
$ |
21,548 |
|
|
$ |
41,132 |
|
|
$ |
29,369 |
|
Tons of ore milled |
|
|
114,475 |
|
|
|
107,441 |
|
|
|
223,220 |
|
|
|
193,675 |
|
Production: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Silver (ounces) |
|
|
1,340,877 |
|
|
|
1,308,155 |
|
|
|
2,673,129 |
|
|
|
2,369,220 |
|
Lead (tons) |
|
|
8,829 |
|
|
|
8,229 |
|
|
|
17,309 |
|
|
|
14,918 |
|
Zinc (tons) |
|
|
3,911 |
|
|
|
3,320 |
|
|
|
7,592 |
|
|
|
6,171 |
|
Payable metal quantities sold: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Silver (ounces) |
|
|
1,228,493 |
|
|
|
1,220,850 |
|
|
|
2,497,338 |
|
|
|
2,174,741 |
|
Lead (tons) |
|
|
8,027 |
|
|
|
7,599 |
|
|
|
16,005 |
|
|
|
13,591 |
|
Zinc (tons) |
|
|
2,887 |
|
|
|
2,919 |
|
|
|
5,968 |
|
|
|
4,560 |
|
Ore grades: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Silver ounces per ton |
|
|
12.5 |
|
|
|
12.9 |
|
|
|
12.7 |
|
|
|
12.9 |
|
Lead percent |
|
|
8.2 |
% |
|
|
8.1 |
% |
|
|
8.2 |
% |
|
|
8.2 |
% |
Zinc percent |
|
|
4.2 |
% |
|
|
3.6 |
% |
|
|
4.1 |
% |
|
|
3.7 |
% |
Total production cost per ton |
|
$ |
241.63 |
|
|
$ |
233.99 |
|
|
$ |
249.89 |
|
|
$ |
233.59 |
|
Cash Cost, After By-product Credits, per Silver Ounce (1) |
|
$ |
6.19 |
|
|
$ |
5.32 |
|
|
$ |
7.77 |
|
|
$ |
6.67 |
|
AISC, After By-product Credits, per Silver Ounce (1) |
|
$ |
19.07 |
|
|
$ |
12.74 |
|
|
$ |
19.57 |
|
|
$ |
14.50 |
|
Capital additions |
|
|
15,942 |
|
|
$ |
10,818 |
|
|
$ |
31,388 |
|
|
$ |
25,806 |
|
Gross profit increased by $0.4 million for the three months ended June 30, 2025 compared to the comparable period in 2024, reflecting a combination of higher sales volumes for all metals due to higher milled tons. Higher realized prices for silver and zinc also positively contributed to the higher gross profit, however this benefit was partly offset by higher contractor, consumables and maintenance costs reflecting the higher volumes produced and sold, and higher profit sharing costs under the collective bargaining agreement.
Gross profit increased by $11.8 million for the six months ended June 30, 2025 compared to the comparable period in 2024, reflecting a combination of higher sales volumes for all metals due to a full six months of production in 2025, compared to 2024 when operations did not resume until January 9, 2024, following suspension of operations in August 2023, due to the underground fire in the secondary egress. Higher realized prices for silver and zinc also positively contributed to the higher gross profit, however this benefit
35
was partly offset by lower realized lead prices and higher contractor, drilling, consumables and maintenance costs reflecting the higher volumes produced and sold, and higher profit sharing costs under the collective bargaining agreement.
Capital additions increased by $5.1 million for the three months ended June 30, 2025, compared to the comparable period in 2024. Significant capital expenditures in 2025 included capital development of $6.4 million, the surface cooling project of $5.4 million, pond 5 construction of $1.3 million and definition drilling of $1.9 million.
Capital additions increased by $5.6 million for the six months ended June 30, 2025 and included $12.5 million for capital development, $6.4 million for the surface cooling project, $3.8 million for definition drilling, $1.8 million for shaft renovations and $1.7 million for pond 5 construction.
The charts below illustrate the factors contributing to Cash Cost, After By-product Credits, Per Silver Ounce for Lucky Friday:
36
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Cash Cost, Before By-product Credits, per Silver Ounce |
|
$ |
22.47 |
|
|
$ |
22.27 |
|
|
$ |
23.79 |
|
|
$ |
23.08 |
|
By-product credits |
|
|
(16.28 |
) |
|
|
(16.95 |
) |
|
|
(16.02 |
) |
|
|
(16.41 |
) |
Cash Cost, After By-product Credits, per Silver Ounce |
|
$ |
6.19 |
|
|
$ |
5.32 |
|
|
$ |
7.77 |
|
|
$ |
6.67 |
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
AISC, Before By-product Credits, per Silver Ounce |
|
$ |
35.35 |
|
|
$ |
29.69 |
|
|
$ |
35.59 |
|
|
$ |
30.91 |
|
By-product credits |
|
|
(16.28 |
) |
|
|
(16.95 |
) |
|
|
(16.02 |
) |
|
|
(16.41 |
) |
AISC, After By-product Credits, per Silver Ounce |
|
$ |
19.07 |
|
|
$ |
12.74 |
|
|
$ |
19.57 |
|
|
$ |
14.50 |
|
The increase in Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce for the three months ended June 30, 2025, compared to the same period in 2024 was primarily due to higher production costs, partly offset by higher silver production. AISC, After By-product Credits, per Silver Ounce was also negatively impacted by higher sustaining capital.
The increase in Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce for the six months ended June 30, 2025, compared to the same period in 2024 was primarily due to higher production costs, partly offset by higher silver production reflecting a full quarter's production compared to operations only commencing on January 9, 2024 following suspension in August 2023 due to the underground fire in the secondary egress. AISC, After By-product Credits, per Silver Ounce was also negatively impacted by higher sustaining capital.
Keno Hill
Dollars are in thousands (except per ounce and per ton amounts) |
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Sales |
|
$ |
26,121 |
|
|
$ |
28,950 |
|
|
$ |
43,030 |
|
|
$ |
39,797 |
|
Cost of sales and other direct production costs |
|
|
(20,740 |
) |
|
|
(24,221 |
) |
|
|
(33,809 |
) |
|
|
(31,466 |
) |
Depreciation, depletion and amortization |
|
|
(5,141 |
) |
|
|
(4,729 |
) |
|
|
(7,943 |
) |
|
|
(8,331 |
) |
Total cost of sales |
|
|
(25,881 |
) |
|
|
(28,950 |
) |
|
|
(41,752 |
) |
|
|
(39,797 |
) |
Gross profit |
|
$ |
240 |
|
|
$ |
— |
|
|
$ |
1,278 |
|
|
$ |
— |
|
Tons of ore milled |
|
|
26,771 |
|
|
|
36,977 |
|
|
|
54,182 |
|
|
|
62,142 |
|
Production: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Silver (ounces) |
|
|
750,712 |
|
|
|
900,440 |
|
|
|
1,523,142 |
|
|
|
1,546,752 |
|
Lead (tons) |
|
|
890 |
|
|
|
845 |
|
|
|
1,921 |
|
|
|
1,421 |
|
Zinc (tons) |
|
|
544 |
|
|
|
471 |
|
|
|
963 |
|
|
|
769 |
|
Payable metal quantities sold: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Silver (ounces) |
|
|
697,475 |
|
|
|
979,543 |
|
|
|
1,196,727 |
|
|
|
1,411,874 |
|
Lead (tons) |
|
|
775 |
|
|
|
849 |
|
|
|
1,466 |
|
|
|
1,208 |
|
Zinc (tons) (1) |
|
|
407 |
|
|
|
337 |
|
|
|
666 |
|
|
|
453 |
|
Ore grades: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Silver ounces per ton |
|
|
28.9 |
|
|
|
25.1 |
|
|
|
29.0 |
|
|
|
25.6 |
|
Lead percent |
|
|
3.5 |
% |
|
|
2.4 |
% |
|
|
3.7 |
% |
|
|
2.4 |
% |
Zinc percent |
|
|
2.3 |
% |
|
|
1.4 |
% |
|
|
2.1 |
% |
|
|
1.4 |
% |
Capital additions |
|
$ |
17,045 |
|
|
$ |
14,533 |
|
|
$ |
27,481 |
|
|
$ |
24,879 |
|
We have not disclosed cost per ounce statistics for the Keno Hill operation as it is in the production ramp-up phase and has not met our definition of commercial production. See above "Consolidated Results of Operations" for our definition of commercial production. Determination of when those criteria have been met requires the use of judgment, and our definition of commercial production may differ from that of other mining companies.
We acquired our Keno Hill operations as part of the Alexco Resource Corp. acquisition in September 2022 and have focused on development activities and began ramp-up of the mill during the second quarter of 2023. The average mill throughput during the six months ended June 30, 2025, was 299 tons per day (the mine is currently permitted to a maximum of an average of 440 tons per day),
37
with silver grades milled of 29.0 ounces per ton. During the first quarter of the year, the mill relied on the existing ore stockpiles as the mine continues to focus on development and ramp up to higher tonnage rates with mining rates of 263 tons per day during the first six months ended June 30, 2025, with material sourced from both the Bermingham and Flame and Moth deposits. Mill throughput, while currently steady, has been negatively impacted by last year's events as described below.
During the three months ended June 30, 2025 and 2024, Keno Hill recorded sales of $26.1 million and $29.0 million, respectively, with the decrease due to lower metals sales volumes, partly offset by higher realized prices. As a result of higher metals prices, Keno Hill generated a gross profit of $0.2 million during the three months ended June 30, 2025, and did not transfer any total cost of sales to ramp-up and suspension costs. During the second quarter of 2024, total cost of sales in excess of sales of $1.8 million were reclassified to ramp-up and suspension costs in the Condensed Consolidated Statements of Operations and Comprehensive Income, (Unaudited). During the quarter, Keno Hill recorded capital additions of $17.0 million, related to mine development and other mining equipment purchases.
During the six months ended June 30, 2025 and 2024, Keno Hill recorded sales of $43.0 million and $39.8 million, respectively, with the increase in sales attributable to higher realized sales prices, partly offset by lower volumes sold. As a result of higher revenues, Keno Hill generated a gross profit of $1.3 million during the six months ended June 30, 2025, and did not transfer any total cost of sales to ramp-up and suspension costs. During the six months ended June 30, 2024, total cost of sales in excess of sales of $10.4 million were reclassified to ramp-up and suspension costs in the Condensed Consolidated Statements of Operations and Comprehensive Income, (Unaudited). During the six months ended June 30, 2025, Keno Hill recorded capital additions of $27.5 million, primarily related to mine development and the Bermingham backfill plant.
From commencement of production until late August, 2024, ore production and mill throughput generally increased as planned, leading to increased levels of production (though still not reaching the permitted capacity at the mill). However, starting in mid-2024 and continuing today, Keno Hill has been impacted by external events which have affected permitting, projects and production, and delayed our ability to reach sustained, profitable production. In late June 2024, an unrelated, third party, Victoria Gold, experienced a heap leach failure at its Eagle Mine which is located near Keno Hill. This incident had several immediate and ongoing impacts on our operations. The primary impact was we were forced to suspend milling operations at Keno Hill between August 27 and October 26 due to delays in receiving authorizations and permits because the focus of the Yukon Government (“YG”) and the First Nation of Na-Cho Nyäk Dun (“FNNND”) was on the Eagle Mine incident response and not on routine permitting matters. Mill operations and design and construction projects resumed during the fourth quarter of 2024. Our original planned schedule for permitting and projects has been extended, but we are taking steps, including working with regulators, to establish a viable schedule for our operational plans.
An ongoing impact of the Eagle Mine incident is the FNNND's public position on mining, which has evolved from a call to halt all mining activity to support of environmentally responsible mining practices. We continue to strengthen our partnership with the FNNND - which is important because Keno Hill is within their Traditional Territory - through enhanced environmental stewardship and community engagement initiatives, building on their support for responsible mining practices.
Then, starting in late October 2024, Keno Hill began experiencing power curtailments when Yukon Energy experienced a turbine failure at its hydroelectric plant in Whitehorse. That failure and Yukon Energy’s resulting focus on line maintenance, combined with cold temperatures in the Yukon (and the resulting increase in demand for power), caused Yukon Energy to reduce power to Keno Hill, resulting in the operation’s inability to fully power the mine and mill on several occasions in late 2024 and for 8 days in the first quarter of 2025. Temporary power constraints in the Yukon region impacted approximately 130,000 ounces of silver production and labor costs for idled employees of approximately $0.5 million through June 30, 2025. These conditions improved in the second quarter of 2025 when we experienced no power disruptions by Yukon Energy, nor do we expect any disruptions while the weather remains warm, except that we expect a 6-day outage in August 2025 when the turbine at Yukon Energy's hydroelectric plant in Whitehorse is scheduled to be fixed. There can be no assurance that Keno Hill will not face power supply constraints in the future.
Permitting is one of the most important factors in our ability to reach sustainable, profitable production at Keno Hill. Increased production means a need for increased tailings storage, waste storage, water treatment, camp space and reliable power, all of which are typical requirements for mining companies in the expansion phase. These projects require new or modified permits, as well as the capital to implement them. Although we continue to make progress on these normal-course permitting matters, we have yet to make up for the delays described above. We also continue to face operational challenges such as work force availability, dilution, execution of projects, limited camp space, and the ramp-up of the Company's environmental remediation services group activities in the summer (which adds incremental demand on Keno Hill's infrastructure and resources, most notably camp space). As a result, we continue to
38
project 2025 silver production to be comparable to 2024 levels. The projected flat production levels at Keno Hill for 2025 should allow us to focus on (i) permitting, (ii) stakeholder outreach and ensuring we have local support, (iii) projects such as tailings storage expansion and the construction of a cemented tails batch plant, (iv) mine development and (v) meeting the above-mentioned operational challenges.
As stated above, Keno Hill has generated marginal profits for us at current throughput rates and prices. Our immediate focus is to advance permits and successfully execute infrastructure projects, with the goal of putting the mine on a path toward achieving its current permitted capacity of 440 tons per day which, at current prices, we project would generate positive free cash flow, while preserving expansion optionality beyond 440 tons per day. To reach 440 tons per day throughput, we would need to continue to mine ore from both the Bermingham deposit and the lower grade Flame & Moth deposit. Currently Keno Hill is not configured to sustainably produce 440 tons per day (although the mill has achieved that rate for multiple weeks on end during test run periods). Achieving 440 or higher tons per day would require targeted infrastructure investments, obtaining permits, executing projects, mine development and maintaining community support. If any one of these were not to occur, or if prices were to decrease from current prices, Keno Hill as currently configured would not be profitable, and placing the operation on care and maintenance would be an option. See Item 1A. Risk Factors - We may not realize all of the anticipated benefits from our acquisitions, including our 2022 acquisition of Alexco in our 2024 Form 10-K.
Casa Berardi
Dollars are in thousands (except per ounce and per ton amounts) |
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Sales |
|
$ |
85,035 |
|
|
$ |
58,623 |
|
|
$ |
141,040 |
|
|
$ |
100,207 |
|
Cost of sales and other direct production costs |
|
|
(44,944 |
) |
|
|
(40,330 |
) |
|
|
(87,057 |
) |
|
|
(75,639 |
) |
Depreciation, depletion and amortization |
|
|
(5,846 |
) |
|
|
(27,010 |
) |
|
|
(14,415 |
) |
|
|
(49,961 |
) |
Total cost of sales |
|
|
(50,790 |
) |
|
|
(67,340 |
) |
|
|
(101,472 |
) |
|
|
(125,600 |
) |
Gross profit (loss) |
|
$ |
34,245 |
|
|
$ |
(8,717 |
) |
|
$ |
39,568 |
|
|
$ |
(25,393 |
) |
Tons of ore milled |
|
|
393,648 |
|
|
|
366,979 |
|
|
|
784,816 |
|
|
|
748,605 |
|
Production: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gold (ounces) |
|
|
28,145 |
|
|
|
23,187 |
|
|
|
48,618 |
|
|
|
45,191 |
|
Silver (ounces) |
|
|
5,943 |
|
|
|
6,338 |
|
|
|
11,095 |
|
|
|
12,465 |
|
Payable metal quantities sold: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gold (ounces) |
|
|
25,699 |
|
|
|
24,964 |
|
|
|
44,876 |
|
|
|
44,967 |
|
Silver (ounces) |
|
|
5,262 |
|
|
|
7,974 |
|
|
|
10,483 |
|
|
|
13,187 |
|
Ore grades: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gold ounces per ton |
|
|
0.08 |
|
|
|
0.07 |
|
|
|
0.07 |
|
|
|
0.07 |
|
Silver ounces per ton |
|
|
0.02 |
|
|
|
0.02 |
|
|
|
0.02 |
|
|
|
0.02 |
|
Total production cost per ton |
|
$ |
113.19 |
|
|
$ |
107.84 |
|
|
$ |
114.19 |
|
|
$ |
102.07 |
|
Cash Cost, After By-product Credits, per Gold Ounce (1) |
|
$ |
1,578 |
|
|
$ |
1,701 |
|
|
$ |
1,837 |
|
|
$ |
1,685 |
|
AISC, After By-product Credits, per Gold Ounce (1) |
|
$ |
1,669 |
|
|
$ |
1,825 |
|
|
$ |
1,935 |
|
|
$ |
1,861 |
|
Capital additions |
|
$ |
15,367 |
|
|
$ |
12,376 |
|
|
$ |
31,624 |
|
|
$ |
25,692 |
|
Casa Berardi is advancing toward a more streamlined and efficient surface-only operation. The plan was to focus exclusively on the 160 pit by mid-2025, however following the significant increase in the gold price during the year to date, it was decided to continue to mine the easily accessible ore in the west underground mine, potentially through the end of 2025. This transition follows the continued successful extraction of higher-margin stopes from the west underground mine, positioning the mine for continued productivity and cost-effective mining. Our previously announced strategic review is ongoing and includes evaluating the following scenarios (i) sale of the asset, (ii) joint venturing the asset, (iii) spin-out of the asset, (iv) extending the underground mine, and (iv) accelerating future cash flows to capture part of the current record gold prices via a prepayment structure or other financing arrangement. If underground mining is not extended, Casa Berardi is expected to only produce gold from the 160 open pit, and at lower volumes than historic production levels, with production expected to conclude at the 160 open pit in 2027. Casa Berardi is transitioning to a new phase focused on developing the Principal and West Mine Crown Pillar open pits. This strategic repositioning is expected to optimize long-term value, with production anticipated to resume following successful permitting and development during a production gap expected
39
between 2027 and 2032. Upon successful completion of permitting, design, and construction of the new open pits (which is not assured), we expect Casa Berardi to generate substantial free cash flow at current gold prices when production resumes. This long-term approach aligns with our commitment to maximizing the value of our assets through strategic mine planning and operational flexibility.
Gross profit increased by $43.0 million to $34.2 million for the three months ended June 30, 2025, compared to a gross loss of $8.7 million in the comparable period in 2024. The increase in gross profit is primarily related to higher realized prices and gold ounces sold, partly offset by higher contractor costs. The prior period gross loss also included higher depreciation expense related to accelerated depreciation of the west underground mine. Capital additions increased by $3.0 million to $15.4 million during the quarter, compared to the same period in 2024, and primarily related to a tailings dam raise.
Gross profit increased by $65.0 million to $39.6 million for the six months ended June 30, 2025, compared to a gross loss of $25.4 million in the comparable period in 2024. The increase in gross profit is primarily related to higher realized prices and gold ounces sold, partly offset by higher contractor costs. The prior period gross loss also included higher depreciation expense related to accelerated depreciation of the west underground mine and a product inventory net realizable value write down of $6.3 million. Capital additions increased by $5.9 million to $31.6 million during the year, compared to the same period in 2024, and primarily related to a tailings dam raise.
Although Casa Berardi generated gross profits during the last four quarters and free cash flow during the current quarter, it reported gross losses during the prior three fiscal years. This lack of profitability and free cash flow generation, the expected hiatus in future production discussed above, the uncertainty surrounding permitting and pit design and construction, and the time involved to resolve these uncertainties, has caused us to undertake a review of how Casa Berardi fits into the Company's future strategy. While it is possible we may continue down the path towards future production at the Principal and West Mine Crown Pillar pits, we are also examining potential strategic alternatives as described above.
40
The charts below illustrate the factors contributing to Cash Cost, After By-product Credits, Per Gold Ounce for Casa Berardi:
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Cash Cost, Before By-product Credits, per Gold Ounce |
|
$ |
1,585 |
|
|
$ |
1,709 |
|
|
$ |
1,845 |
|
|
$ |
1,692 |
|
By-product credits |
|
|
(7 |
) |
|
|
(8 |
) |
|
|
(8 |
) |
|
|
(7 |
) |
Cash Cost, After By-product Credits, per Gold Ounce |
|
$ |
1,578 |
|
|
$ |
1,701 |
|
|
$ |
1,837 |
|
|
$ |
1,685 |
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
AISC, Before By-product Credits, per Gold Ounce |
|
$ |
1,676 |
|
|
$ |
1,833 |
|
|
$ |
1,943 |
|
|
$ |
1,868 |
|
By-product credits |
|
|
(7 |
) |
|
|
(8 |
) |
|
|
(8 |
) |
|
|
(7 |
) |
AISC, After By-product Credits, per Gold Ounce |
|
$ |
1,669 |
|
|
$ |
1,825 |
|
|
$ |
1,935 |
|
|
$ |
1,861 |
|
41
The decrease in Cash Cost After By-product Credits, per Gold Ounce, and AISC, After By-product Credits, per Gold Ounce for the three months ended June 30, 2025, compared to the same period in 2024 was primarily due to higher gold production.
The increase in Cash Cost After By-product Credits, per Gold Ounce, and AISC, After By-product Credits, per Gold Ounce for the three and six months ended June 30, 2025, compared to the same period in 2024 was primarily due to higher production costs, partly offset by higher gold production. AISC, After By-product Credits, per Gold Ounce benefited from lower sustaining capital over the comparable period in 2024.
Corporate Matters
Income Taxes
During the three and six months ended June 30, 2025, an income and mining tax provision of $32.6 million and $48.7 million, resulted in an effective tax rate of 36.1% and 36.0%, respectively. This compares to an income and mining tax provision of $9.1 million and $10.9 million, which resulted in an effective tax rate of 24.6% and 33.0%, respectively, for the three and six months ended June 30, 2024. The comparability of our income and mining tax provision and effective tax rate for the reported periods was impacted by multiple factors, primarily: (i) mining taxes; (ii) variations in our income before income taxes; (iii) geographic distribution of that income; (iv) foreign exchange rates including non-recognition of foreign exchange gains and losses; (v) percentage depletion; and (vi) the non-recognition of tax assets. The effective tax rate will fluctuate, sometimes significantly, period to period. The change in the effective tax rate during the three and six months ended June 30, 2025, compared to the comparable periods in 2024 is primarily related to the reported consolidated income (loss) as well as the losses incurred at our consolidated Alexco subsidiaries, and our Nevada subsidiaries, for which no tax benefit is recognized due to uncertainty surrounding our ability to utilize these future tax benefits.
Each reporting period we assess our deferred tax balances based on a review of long-range forecasts and quarterly activity. A valuation allowance is provided for deferred tax assets for which it is more likely than not the related tax benefits will not be realized. We analyze our deferred tax assets and, if it is determined that we will not realize all or a portion of our deferred tax assets, we record or increase a valuation allowance. Conversely, if it is determined we will ultimately more likely than not be able to realize all or a portion of the related benefits for which a valuation allowance has been provided, all or a portion of the related valuation allowance will be reduced. There are a number of factors that impact our ability to realize our deferred tax assets. Valuation allowances are provided on deferred tax assets in Nevada, Mexico, and certain Canadian jurisdictions. For additional information, please see risk factors Our accounting and other estimates may be imprecise and Our ability to recognize the benefits of deferred tax assets related to net operating loss carryforwards and other items is dependent on future cash flows generating taxable income in Item 1A - Risk Factors in our 2024 Form 10-K.
Reconciliation of Total Cost of Sales 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 total cost of sales 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 and for the Company for the three and six months ended June 30, 2025 and 2024.
Cash Cost, After By-product Credits, per Ounce and AISC, After By-product Credits, per Ounce are measures developed by precious metals companies (including the Silver Institute and the World Gold Council) 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 use AISC, After By-product Credits, per Ounce as a measure of our mines' net cash flow after costs for 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 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 mines versus those of our competitors. As a silver and gold mining company, we also use these statistics on an aggregate basis - aggregating the Greens Creek and Lucky Friday mines to compare our performance with that of other silver 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.
42
We have not disclosed cost per ounce statistics for the Keno Hill operation as it is in the production ramp-up phase and has not met our definition of commercial production. See above "Consolidated Results of Operations" for our definition of commercial production. Determination of when those criteria have been met requires the use of judgment, and our definition of commercial production may differ from that of other mining companies.
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 mine also includes reclamation and sustaining capital costs. AISC, Before By-product Credits for our consolidated silver properties also includes corporate costs for general and administrative expense and sustaining capital costs. By-product credits include revenues earned from all metals other than the primary metal produced at each unit. 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. We currently do not report Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce for our Keno Hill operation as it is in the ramp-up phase of production and accordingly it is excluded from our consolidated Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce.
Casa Berardi reports 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. Only costs and ounces produced relating to units 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 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 three units is not included as a by-product credit when calculating the gold metrics for Casa Berardi.
In thousands (except per ounce amounts) |
|
Three Months Ended June 30, 2025 |
|
|||||||||||||||||
|
|
Greens Creek |
|
|
Lucky Friday |
|
|
Keno Hill (5) |
|
|
Corporate (2) |
|
|
Total Silver |
|
|||||
Total cost of sales |
|
$ |
58,921 |
|
|
$ |
42,286 |
|
|
$ |
25,881 |
|
|
$ |
— |
|
|
$ |
127,088 |
|
Depreciation, depletion and amortization |
|
|
(12,897 |
) |
|
|
(13,275 |
) |
|
|
(5,141 |
) |
|
|
— |
|
|
|
(31,313 |
) |
Treatment costs |
|
|
(1,001 |
) |
|
|
1,054 |
|
|
|
— |
|
|
|
— |
|
|
|
53 |
|
Change in product inventory |
|
|
9,234 |
|
|
|
225 |
|
|
|
— |
|
|
|
— |
|
|
|
9,459 |
|
Reclamation and other costs |
|
|
57 |
|
|
|
(160 |
) |
|
|
— |
|
|
|
— |
|
|
|
(103 |
) |
Exclusion of Keno Hill cash costs (5) |
|
|
— |
|
|
|
— |
|
|
|
(20,740 |
) |
|
|
— |
|
|
|
(20,740 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
54,314 |
|
|
|
30,130 |
|
|
|
— |
|
|
|
— |
|
|
|
84,444 |
|
Reclamation and other costs |
|
|
757 |
|
|
|
195 |
|
|
|
— |
|
|
|
— |
|
|
|
952 |
|
Sustaining capital |
|
|
8,268 |
|
|
|
17,069 |
|
|
|
— |
|
|
|
1,270 |
|
|
|
26,607 |
|
General and administrative |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
12,540 |
|
|
|
12,540 |
|
AISC, Before By-product Credits (1) |
|
|
63,339 |
|
|
|
47,394 |
|
|
|
— |
|
|
|
13,810 |
|
|
|
124,543 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Zinc |
|
|
(23,512 |
) |
|
|
(7,120 |
) |
|
|
— |
|
|
|
— |
|
|
|
(30,632 |
) |
Gold |
|
|
(52,194 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(52,194 |
) |
Lead |
|
|
(6,610 |
) |
|
|
(14,708 |
) |
|
|
— |
|
|
|
— |
|
|
|
(21,318 |
) |
Copper |
|
|
(871 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(871 |
) |
Total By-product credits |
|
|
(83,187 |
) |
|
|
(21,828 |
) |
|
|
— |
|
|
|
— |
|
|
|
(105,015 |
) |
Cash Cost, After By-product Credits |
|
$ |
(28,873 |
) |
|
$ |
8,302 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(20,571 |
) |
AISC, After By-product Credits |
|
$ |
(19,848 |
) |
|
$ |
25,566 |
|
|
$ |
— |
|
|
$ |
13,810 |
|
|
$ |
19,528 |
|
Ounces produced |
|
|
2,423 |
|
|
|
1,341 |
|
|
|
|
|
|
|
|
|
3,764 |
|
||
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
22.42 |
|
|
$ |
22.47 |
|
|
|
|
|
|
|
|
$ |
22.44 |
|
||
By-product credits per ounce |
|
|
(34.33 |
) |
|
|
(16.28 |
) |
|
|
|
|
|
|
|
|
(27.90 |
) |
||
Cash Cost, After By-product Credits, per Ounce |
|
$ |
(11.91 |
) |
|
$ |
6.19 |
|
|
|
|
|
|
|
|
$ |
(5.46 |
) |
||
AISC, Before By-product Credits, per Ounce |
|
$ |
26.14 |
|
|
$ |
35.35 |
|
|
|
|
|
|
|
|
$ |
33.09 |
|
||
By-product credits per ounce |
|
|
(34.33 |
) |
|
|
(16.28 |
) |
|
|
|
|
|
|
|
|
(27.90 |
) |
||
AISC, After By-product Credits, per Ounce |
|
$ |
(8.19 |
) |
|
|
19.07 |
|
|
|
|
|
|
|
|
$ |
5.19 |
|
||
43
In thousands (except per ounce amounts) |
|
Three Months Ended June 30, 2025 |
|
|||||||||
|
|
Gold - Casa Berardi |
|
|
Other (4) |
|
|
Total Gold and Other |
|
|||
Total cost of sales |
|
$ |
50,790 |
|
|
$ |
6,625 |
|
|
$ |
57,415 |
|
Depreciation, depletion and amortization |
|
|
(5,846 |
) |
|
|
|
|
|
(5,846 |
) |
|
Treatment costs |
|
|
44 |
|
|
|
— |
|
|
|
44 |
|
Change in product inventory |
|
|
(62 |
) |
|
|
— |
|
|
|
(62 |
) |
Reclamation and other costs |
|
|
(324 |
) |
|
|
— |
|
|
|
(324 |
) |
Exclusion of Other costs |
|
|
— |
|
|
|
(6,625 |
) |
|
|
(6,625 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
44,602 |
|
|
|
— |
|
|
|
44,602 |
|
Reclamation and other costs |
|
|
324 |
|
|
|
— |
|
|
|
324 |
|
Sustaining capital |
|
|
2,242 |
|
|
|
— |
|
|
|
2,242 |
|
AISC, Before By-product Credits (1) |
|
|
47,168 |
|
|
|
— |
|
|
|
47,168 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|||
Silver |
|
|
(202 |
) |
|
|
— |
|
|
|
(202 |
) |
Total By-product credits |
|
|
(202 |
) |
|
|
— |
|
|
|
(202 |
) |
Cash Cost, After By-product Credits |
|
$ |
44,400 |
|
|
$ |
— |
|
|
$ |
44,400 |
|
AISC, After By-product Credits |
|
$ |
46,966 |
|
|
$ |
— |
|
|
$ |
46,966 |
|
Divided by ounces produced |
|
|
28 |
|
|
|
— |
|
|
|
28 |
|
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
1,585 |
|
|
$ |
— |
|
|
$ |
1,585 |
|
By-product credits per ounce |
|
|
(7 |
) |
|
|
— |
|
|
|
(7 |
) |
Cash Cost, After By-product Credits, per Ounce |
|
$ |
1,578 |
|
|
$ |
— |
|
|
$ |
1,578 |
|
AISC, Before By-product Credits, per Ounce |
|
$ |
1,676 |
|
|
$ |
— |
|
|
$ |
1,676 |
|
By-product credits per ounce |
|
|
(7 |
) |
|
|
— |
|
|
|
(7 |
) |
AISC, After By-product Credits, per Ounce |
|
$ |
1,669 |
|
|
$ |
— |
|
|
$ |
1,669 |
|
44
In thousands (except per ounce amounts) |
|
Three Months Ended June 30, 2025 |
|
|||||||||
|
|
Total Silver |
|
|
Total Gold and Other |
|
|
Total |
|
|||
Total cost of sales |
|
$ |
127,088 |
|
|
$ |
57,415 |
|
|
$ |
184,503 |
|
Depreciation, depletion and amortization |
|
|
(31,313 |
) |
|
|
(5,846 |
) |
|
|
(37,159 |
) |
Treatment costs |
|
|
53 |
|
|
|
44 |
|
|
|
97 |
|
Change in product inventory |
|
|
9,459 |
|
|
|
(62 |
) |
|
|
9,397 |
|
Reclamation and other costs |
|
|
(103 |
) |
|
|
(324 |
) |
|
|
(427 |
) |
Exclusion of Keno Hill cash costs (5) |
|
|
(20,740 |
) |
|
|
— |
|
|
|
(20,740 |
) |
Exclusion of Other costs |
|
|
— |
|
|
|
(6,625 |
) |
|
|
(6,625 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
84,444 |
|
|
|
44,602 |
|
|
|
129,046 |
|
Reclamation and other costs |
|
|
952 |
|
|
|
324 |
|
|
|
1,276 |
|
Sustaining capital |
|
|
26,607 |
|
|
|
2,242 |
|
|
|
28,849 |
|
General and administrative |
|
|
12,540 |
|
|
|
— |
|
|
|
12,540 |
|
AISC, Before By-product Credits (1) |
|
|
124,543 |
|
|
|
47,168 |
|
|
|
171,711 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|||
Zinc |
|
|
(30,632 |
) |
|
|
— |
|
|
|
(30,632 |
) |
Gold |
|
|
(52,194 |
) |
|
|
— |
|
|
|
(52,194 |
) |
Lead |
|
|
(21,318 |
) |
|
|
— |
|
|
|
(21,318 |
) |
Silver |
|
|
— |
|
|
|
(202 |
) |
|
|
(202 |
) |
Copper |
|
|
(871 |
) |
|
|
— |
|
|
|
(871 |
) |
Total By-product credits |
|
|
(105,015 |
) |
|
|
(202 |
) |
|
|
(105,217 |
) |
Cash Cost, After By-product Credits |
|
$ |
(20,571 |
) |
|
$ |
44,400 |
|
|
$ |
23,829 |
|
AISC, After By-product Credits |
|
$ |
19,528 |
|
|
$ |
46,966 |
|
|
$ |
66,494 |
|
Divided by ounces produced |
|
|
3,764 |
|
|
|
28 |
|
|
|
|
|
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
22.44 |
|
|
$ |
1,585 |
|
|
|
|
|
By-product credits per ounce |
|
|
(27.90 |
) |
|
|
(7 |
) |
|
|
|
|
Cash Cost, After By-product Credits, per Ounce |
|
$ |
(5.46 |
) |
|
$ |
1,578 |
|
|
|
|
|
AISC, Before By-product Credits, per Ounce |
|
$ |
33.09 |
|
|
$ |
1,676 |
|
|
|
|
|
By-product credits per ounce |
|
|
(27.90 |
) |
|
|
(7 |
) |
|
|
|
|
AISC, After By-product Credits, per Ounce |
|
$ |
5.19 |
|
|
$ |
1,669 |
|
|
|
|
|
45
In thousands (except per ounce amounts) |
|
Three Months Ended June 30, 2024 |
|
|||||||||||||||||
|
|
Greens Creek |
|
|
Lucky Friday |
|
|
Keno Hill (5) |
|
|
Corporate (2) |
|
|
Total Silver |
|
|||||
Total cost of sales |
|
$ |
56,786 |
|
|
$ |
37,523 |
|
|
$ |
28,950 |
|
|
$ |
— |
|
|
$ |
123,259 |
|
Depreciation, depletion and amortization |
|
|
(11,316 |
) |
|
|
(10,708 |
) |
|
|
(4,729 |
) |
|
|
— |
|
|
|
(26,753 |
) |
Treatment costs |
|
|
6,069 |
|
|
|
2,746 |
|
|
|
— |
|
|
|
— |
|
|
|
8,815 |
|
Change in product inventory |
|
|
7,296 |
|
|
|
(115 |
) |
|
|
— |
|
|
|
— |
|
|
|
7,181 |
|
Reclamation and other costs |
|
|
(882 |
) |
|
|
(311 |
) |
|
|
— |
|
|
|
— |
|
|
|
(1,193 |
) |
Exclusion of Keno Hill cash costs (5) |
|
|
— |
|
|
|
— |
|
|
|
(24,221 |
) |
|
|
— |
|
|
|
(24,221 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
57,953 |
|
|
|
29,135 |
|
|
|
— |
|
|
|
— |
|
|
|
87,088 |
|
Reclamation and other costs |
|
|
785 |
|
|
|
183 |
|
|
|
— |
|
|
|
— |
|
|
|
968 |
|
Sustaining capital |
|
|
10,911 |
|
|
|
9,517 |
|
|
|
— |
|
|
|
1,035 |
|
|
|
21,463 |
|
General and administrative |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
14,740 |
|
|
|
14,740 |
|
AISC, Before By-product Credits (1) |
|
|
69,649 |
|
|
|
38,835 |
|
|
|
— |
|
|
|
15,775 |
|
|
|
124,259 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Zinc |
|
|
(21,873 |
) |
|
|
(6,706 |
) |
|
|
— |
|
|
|
— |
|
|
|
(28,579 |
) |
Gold |
|
|
(28,844 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(28,844 |
) |
Lead |
|
|
(6,818 |
) |
|
|
(15,466 |
) |
|
|
— |
|
|
|
— |
|
|
|
(22,284 |
) |
Total By-product credits |
|
|
(57,535 |
) |
|
|
(22,172 |
) |
|
|
— |
|
|
|
— |
|
|
|
(79,707 |
) |
Cash Cost, After By-product Credits |
|
$ |
418 |
|
|
$ |
6,963 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
7,381 |
|
AISC, After By-product Credits |
|
$ |
12,114 |
|
|
$ |
16,663 |
|
|
$ |
— |
|
|
$ |
15,775 |
|
|
$ |
44,552 |
|
Divided by ounces produced |
|
|
2,244 |
|
|
|
1,308 |
|
|
|
|
|
|
|
|
|
3,552 |
|
||
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
25.83 |
|
|
$ |
22.27 |
|
|
|
|
|
|
|
|
$ |
24.52 |
|
||
By-product credits per ounce |
|
|
(25.64 |
) |
|
|
(16.95 |
) |
|
|
|
|
|
|
|
|
(22.44 |
) |
||
Cash Cost, After By-product Credits, per Ounce |
|
$ |
0.19 |
|
|
$ |
5.32 |
|
|
|
|
|
|
|
|
$ |
2.08 |
|
||
AISC, Before By-product Credits, per Ounce |
|
$ |
31.04 |
|
|
$ |
29.69 |
|
|
|
|
|
|
|
|
$ |
34.98 |
|
||
By-product credits per ounce |
|
|
(25.64 |
) |
|
|
(16.95 |
) |
|
|
|
|
|
|
|
|
(22.44 |
) |
||
AISC, After By-product Credits, per Ounce |
|
$ |
5.40 |
|
|
$ |
12.74 |
|
|
|
|
|
|
|
|
$ |
12.54 |
|
||
In thousands (except per ounce amounts) |
|
Three Months Ended June 30, 2024 |
|
|||||||||
|
|
Gold - Casa Berardi |
|
|
Other (4) |
|
|
Total Gold and Other |
|
|||
Total cost of sales |
|
$ |
67,340 |
|
|
$ |
3,628 |
|
|
$ |
70,968 |
|
Depreciation, depletion and amortization |
|
|
(27,010 |
) |
|
|
— |
|
|
|
(27,010 |
) |
Treatment costs |
|
|
52 |
|
|
|
— |
|
|
|
52 |
|
Change in product inventory |
|
|
(550 |
) |
|
|
— |
|
|
|
(550 |
) |
Reclamation and other costs |
|
|
(206 |
) |
|
|
— |
|
|
|
(206 |
) |
Exclusion of Other costs |
|
|
— |
|
|
|
(3,628 |
) |
|
|
(3,628 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
39,626 |
|
|
|
— |
|
|
|
39,626 |
|
Reclamation and other costs |
|
|
206 |
|
|
|
— |
|
|
|
206 |
|
Sustaining capital |
|
|
2,667 |
|
|
|
— |
|
|
|
2,667 |
|
AISC, Before By-product Credits (1) |
|
|
42,499 |
|
|
|
— |
|
|
|
42,499 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|||
Silver |
|
|
(183 |
) |
|
|
— |
|
|
|
(183 |
) |
Total By-product credits |
|
|
(183 |
) |
|
|
— |
|
|
|
(183 |
) |
Cash Cost, After By-product Credits |
|
$ |
39,443 |
|
|
$ |
— |
|
|
$ |
39,443 |
|
AISC, After By-product Credits |
|
$ |
42,316 |
|
|
$ |
— |
|
|
$ |
42,316 |
|
Divided by ounces produced |
|
|
23 |
|
|
|
— |
|
|
|
23 |
|
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
1,709 |
|
|
$ |
— |
|
|
$ |
1,709 |
|
By-product credits per ounce |
|
|
(8 |
) |
|
|
— |
|
|
|
(8 |
) |
Cash Cost, After By-product Credits, per Ounce |
|
$ |
1,701 |
|
|
$ |
— |
|
|
$ |
1,701 |
|
AISC, Before By-product Credits, per Ounce |
|
$ |
1,833 |
|
|
$ |
— |
|
|
$ |
1,833 |
|
By-product credits per ounce |
|
|
(8 |
) |
|
|
— |
|
|
|
(8 |
) |
AISC, After By-product Credits, per Ounce |
|
$ |
1,825 |
|
|
$ |
— |
|
|
$ |
1,825 |
|
46
In thousands (except per ounce amounts) |
|
Three Months Ended June 30, 2024 |
|
|||||||||
|
|
Total Silver |
|
|
Total Gold and Other |
|
|
Total |
|
|||
Total cost of sales |
|
$ |
123,259 |
|
|
$ |
70,968 |
|
|
$ |
194,227 |
|
Depreciation, depletion and amortization |
|
|
(26,753 |
) |
|
|
(27,010 |
) |
|
|
(53,763 |
) |
Treatment costs |
|
|
8,815 |
|
|
|
52 |
|
|
|
8,867 |
|
Change in product inventory |
|
|
7,181 |
|
|
|
(550 |
) |
|
|
6,631 |
|
Reclamation and other costs |
|
|
(1,193 |
) |
|
|
(206 |
) |
|
|
(1,399 |
) |
Exclusion of Other costs |
|
|
— |
|
|
|
(3,628 |
) |
|
|
(3,628 |
) |
Exclusion of Keno Hill cash costs (5) |
|
|
(24,221 |
) |
|
|
— |
|
|
|
(24,221 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
87,088 |
|
|
|
39,626 |
|
|
|
126,714 |
|
Reclamation and other costs |
|
|
968 |
|
|
|
206 |
|
|
|
1,174 |
|
Sustaining capital |
|
|
21,463 |
|
|
|
2,667 |
|
|
|
24,130 |
|
General and administrative |
|
|
14,740 |
|
|
|
— |
|
|
|
14,740 |
|
AISC, Before By-product Credits (1) |
|
|
124,259 |
|
|
|
42,499 |
|
|
|
166,758 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|||
Zinc |
|
|
(28,579 |
) |
|
|
— |
|
|
|
(28,579 |
) |
Gold |
|
|
(28,844 |
) |
|
|
— |
|
|
|
(28,844 |
) |
Lead |
|
|
(22,284 |
) |
|
|
— |
|
|
|
(22,284 |
) |
Silver |
|
|
— |
|
|
|
(183 |
) |
|
|
(183 |
) |
Total By-product credits |
|
|
(79,707 |
) |
|
|
(183 |
) |
|
|
(79,890 |
) |
Cash Cost, After By-product Credits |
|
$ |
7,381 |
|
|
$ |
39,443 |
|
|
$ |
46,824 |
|
AISC, After By-product Credits |
|
$ |
44,552 |
|
|
$ |
42,316 |
|
|
$ |
86,868 |
|
Divided by ounces produced |
|
|
3,552 |
|
|
|
23 |
|
|
|
|
|
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
24.52 |
|
|
$ |
1,709 |
|
|
|
|
|
By-product credits per ounce |
|
|
(22.44 |
) |
|
|
(8 |
) |
|
|
|
|
Cash Cost, After By-product Credits, per Ounce |
|
$ |
2.08 |
|
|
$ |
1,701 |
|
|
|
|
|
AISC, Before By-product Credits, per Ounce |
|
$ |
34.98 |
|
|
$ |
1,833 |
|
|
|
|
|
By-product credits per ounce |
|
|
(22.44 |
) |
|
|
(8 |
) |
|
|
|
|
AISC, After By-product Credits, per Ounce |
|
$ |
12.54 |
|
|
$ |
1,825 |
|
|
|
|
|
47
In thousands (except per ounce amounts) |
|
Six Months Ended June 30, 2025 |
|
|||||||||||||||||
|
|
Greens Creek |
|
|
Lucky Friday |
|
|
Keno Hill (5) |
|
|
Corporate (2) |
|
|
Total Silver |
|
|||||
Total cost of sales |
|
$ |
128,559 |
|
|
$ |
86,335 |
|
|
$ |
41,752 |
|
|
$ |
— |
|
|
$ |
256,646 |
|
Depreciation, depletion and amortization |
|
|
(26,486 |
) |
|
|
(26,700 |
) |
|
|
(7,943 |
) |
|
|
— |
|
|
|
(61,129 |
) |
Treatment costs |
|
|
1,142 |
|
|
|
5,017 |
|
|
|
— |
|
|
|
— |
|
|
|
6,159 |
|
Change in product inventory |
|
|
8,333 |
|
|
|
(614 |
) |
|
|
— |
|
|
|
— |
|
|
|
7,719 |
|
Reclamation and other costs |
|
|
(250 |
) |
|
|
(433 |
) |
|
|
— |
|
|
|
— |
|
|
|
(683 |
) |
Exclusion of Keno Hill cash costs (5) |
|
|
— |
|
|
|
— |
|
|
|
(33,809 |
) |
|
|
— |
|
|
|
(33,809 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
111,298 |
|
|
|
63,605 |
|
|
|
— |
|
|
|
— |
|
|
|
174,903 |
|
Reclamation and other costs |
|
|
1,514 |
|
|
|
390 |
|
|
|
— |
|
|
|
|
|
|
1,904 |
|
|
Sustaining capital |
|
|
15,636 |
|
|
|
31,139 |
|
|
|
— |
|
|
|
2,295 |
|
|
|
49,070 |
|
General and administrative |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
24,539 |
|
|
|
24,539 |
|
AISC, Before By-product Credits (1) |
|
|
128,448 |
|
|
|
95,134 |
|
|
|
— |
|
|
|
26,834 |
|
|
|
250,416 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Zinc |
|
|
(46,886 |
) |
|
|
(14,070 |
) |
|
|
— |
|
|
|
— |
|
|
|
(60,956 |
) |
Gold |
|
|
(87,171 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(87,171 |
) |
Lead |
|
|
(12,701 |
) |
|
|
(28,751 |
) |
|
|
— |
|
|
|
— |
|
|
|
(41,452 |
) |
Copper |
|
|
(1,600 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,600 |
) |
Total By-product credits |
|
|
(148,358 |
) |
|
|
(42,821 |
) |
|
|
— |
|
|
|
— |
|
|
|
(191,179 |
) |
Cash Cost, After By-product Credits |
|
$ |
(37,060 |
) |
|
$ |
20,784 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(16,276 |
) |
AISC, After By-product Credits |
|
$ |
(19,910 |
) |
|
$ |
52,313 |
|
|
$ |
— |
|
|
$ |
26,834 |
|
|
$ |
59,237 |
|
Divided by ounces produced |
|
|
4,426 |
|
|
|
2,673 |
|
|
|
|
|
|
|
|
|
7,099 |
|
||
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
25.15 |
|
|
$ |
23.79 |
|
|
|
|
|
|
|
|
$ |
24.64 |
|
||
By-product credits per ounce |
|
|
(33.52 |
) |
|
|
(16.02 |
) |
|
|
|
|
|
|
|
|
(26.93 |
) |
||
Cash Cost, After By-product Credits, per Ounce |
|
$ |
(8.37 |
) |
|
$ |
7.77 |
|
|
|
|
|
|
|
|
$ |
(2.29 |
) |
||
AISC, Before By-product Credits, per Ounce |
|
$ |
29.02 |
|
|
$ |
35.59 |
|
|
|
|
|
|
|
|
$ |
35.28 |
|
||
By-product credits per ounce |
|
|
(33.52 |
) |
|
|
(16.02 |
) |
|
|
|
|
|
|
|
|
(26.93 |
) |
||
AISC, After By-product Credits, per Ounce |
|
$ |
(4.50 |
) |
|
$ |
19.57 |
|
|
|
|
|
|
|
|
$ |
8.35 |
|
||
In thousands (except per ounce amounts) |
|
Six Months Ended June 30, 2025 |
|
|||||||||
|
|
Casa Berardi |
|
|
Other (4) |
|
|
Total Gold |
|
|||
Total cost of sales |
|
$ |
101,472 |
|
|
$ |
13,720 |
|
|
$ |
115,192 |
|
Depreciation, depletion and amortization |
|
|
(14,415 |
) |
|
|
— |
|
|
|
(14,415 |
) |
Treatment costs |
|
|
89 |
|
|
|
— |
|
|
|
89 |
|
Change in product inventory |
|
|
3,196 |
|
|
|
— |
|
|
|
3,196 |
|
Reclamation and other costs |
|
|
(636 |
) |
|
|
— |
|
|
|
(636 |
) |
Exclusion of Other costs |
|
|
— |
|
|
|
(13,720 |
) |
|
|
(13,720 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
89,706 |
|
|
|
— |
|
|
|
89,706 |
|
Reclamation and other costs |
|
|
636 |
|
|
|
— |
|
|
|
636 |
|
Sustaining capital |
|
|
4,136 |
|
|
|
— |
|
|
|
4,136 |
|
AISC, Before By-product Credits (1) |
|
|
94,478 |
|
|
|
— |
|
|
|
94,478 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|||
Silver |
|
|
(367 |
) |
|
|
— |
|
|
|
(367 |
) |
Total By-product credits |
|
|
(367 |
) |
|
|
— |
|
|
|
(367 |
) |
Cash Cost, After By-product Credits |
|
$ |
89,339 |
|
|
$ |
— |
|
|
$ |
89,339 |
|
AISC, After By-product Credits |
|
$ |
94,111 |
|
|
$ |
— |
|
|
$ |
94,111 |
|
Divided by ounces produced |
|
|
49 |
|
|
|
— |
|
|
|
49 |
|
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
1,845 |
|
|
$ |
— |
|
|
$ |
1,845 |
|
By-product credits per ounce |
|
|
(8 |
) |
|
|
— |
|
|
|
(8 |
) |
Cash Cost, After By-product Credits, per Ounce |
|
$ |
1,837 |
|
|
$ |
— |
|
|
$ |
1,837 |
|
AISC, Before By-product Credits, per Ounce |
|
$ |
1,943 |
|
|
$ |
— |
|
|
$ |
1,943 |
|
By-product credits per ounce |
|
|
(8 |
) |
|
|
— |
|
|
|
(8 |
) |
AISC, After By-product Credits, per Ounce |
|
$ |
1,935 |
|
|
$ |
— |
|
|
$ |
1,935 |
|
48
In thousands (except per ounce amounts) |
|
Six Months Ended June 30, 2025 |
|
|||||||||
|
|
Total Silver |
|
|
Total Gold and Other |
|
|
Total |
|
|||
Total cost of sales |
|
$ |
256,646 |
|
|
$ |
115,192 |
|
|
$ |
371,838 |
|
Depreciation, depletion and amortization |
|
|
(61,129 |
) |
|
|
(14,415 |
) |
|
|
(75,544 |
) |
Treatment costs |
|
|
6,159 |
|
|
|
89 |
|
|
|
6,248 |
|
Change in product inventory |
|
|
7,719 |
|
|
|
3,196 |
|
|
|
10,915 |
|
Reclamation and other costs |
|
|
(683 |
) |
|
|
(636 |
) |
|
|
(1,319 |
) |
Exclusion of Keno Hill cash costs (5) |
|
|
(33,809 |
) |
|
|
— |
|
|
|
(33,809 |
) |
Exclusion of Other costs |
|
|
— |
|
|
|
(13,720 |
) |
|
|
(13,720 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
174,903 |
|
|
|
89,706 |
|
|
|
264,609 |
|
Reclamation and other costs |
|
|
1,904 |
|
|
|
636 |
|
|
|
2,540 |
|
Sustaining capital |
|
|
49,070 |
|
|
|
4,136 |
|
|
|
53,206 |
|
General and administrative |
|
|
24,539 |
|
|
|
— |
|
|
|
24,539 |
|
AISC, Before By-product Credits (1) |
|
|
250,416 |
|
|
|
94,478 |
|
|
|
344,894 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|||
Zinc |
|
|
(60,956 |
) |
|
|
— |
|
|
|
(60,956 |
) |
Gold |
|
|
(87,171 |
) |
|
|
— |
|
|
|
(87,171 |
) |
Lead |
|
|
(41,452 |
) |
|
|
— |
|
|
|
(41,452 |
) |
Copper |
|
|
(1,600 |
) |
|
|
— |
|
|
|
(1,600 |
) |
Silver |
|
|
— |
|
|
|
(367 |
) |
|
|
(367 |
) |
Total By-product credits |
|
|
(191,179 |
) |
|
|
(367 |
) |
|
|
(191,546 |
) |
Cash Cost, After By-product Credits |
|
$ |
(16,276 |
) |
|
$ |
89,339 |
|
|
$ |
73,063 |
|
AISC, After By-product Credits |
|
$ |
59,237 |
|
|
$ |
94,111 |
|
|
$ |
153,348 |
|
Divided by ounces produced |
|
|
7,099 |
|
|
|
49 |
|
|
|
|
|
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
24.64 |
|
|
$ |
1,845 |
|
|
|
|
|
By-product credits per ounce |
|
|
(26.93 |
) |
|
|
(8 |
) |
|
|
|
|
Cash Cost, After By-product Credits, per Ounce |
|
$ |
(2.29 |
) |
|
$ |
1,837 |
|
|
|
|
|
AISC, Before By-product Credits, per Ounce |
|
$ |
35.28 |
|
|
$ |
1,943 |
|
|
|
|
|
By-product credits per ounce |
|
|
(26.93 |
) |
|
|
(8 |
) |
|
|
|
|
AISC, After By-product Credits, per Ounce |
|
$ |
8.35 |
|
|
$ |
1,935 |
|
|
|
|
|
49
In thousands (except per ounce amounts) |
|
Six Months Ended June 30, 2024 |
|
|||||||||||||||||
|
|
Greens Creek |
|
|
Lucky Friday |
|
|
Keno Hill(5) |
|
|
Corporate (2) |
|
|
Total Silver |
|
|||||
Total cost of sales |
|
$ |
126,643 |
|
|
$ |
65,042 |
|
|
$ |
39,797 |
|
|
$ |
— |
|
|
$ |
231,482 |
|
Depreciation, depletion and amortization |
|
|
(25,759 |
) |
|
|
(18,619 |
) |
|
|
(8,331 |
) |
|
|
— |
|
|
|
(52,709 |
) |
Treatment costs |
|
|
15,793 |
|
|
|
5,969 |
|
|
|
— |
|
|
|
— |
|
|
|
21,762 |
|
Change in product inventory |
|
|
5,100 |
|
|
|
496 |
|
|
|
— |
|
|
|
— |
|
|
|
5,596 |
|
Reclamation and other costs |
|
|
(1,537 |
) |
|
|
(413 |
) |
|
|
— |
|
|
|
— |
|
|
|
(1,950 |
) |
Exclusion of Lucky Friday cash costs (3) |
|
|
— |
|
|
|
(3,634 |
) |
|
|
— |
|
|
|
— |
|
|
|
(3,634 |
) |
Exclusion of Keno Hill cash costs (5) |
|
|
— |
|
|
|
— |
|
|
|
(31,466 |
) |
|
|
— |
|
|
|
(31,466 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
120,240 |
|
|
|
48,841 |
|
|
|
— |
|
|
|
— |
|
|
|
169,081 |
|
Reclamation and other costs |
|
|
1,570 |
|
|
|
405 |
|
|
|
— |
|
|
|
— |
|
|
|
1,975 |
|
Sustaining capital |
|
|
19,327 |
|
|
|
21,568 |
|
|
|
— |
|
|
|
1,101 |
|
|
|
41,996 |
|
Exclusion of Lucky Friday sustaining costs |
|
|
— |
|
|
|
(5,396 |
) |
|
|
— |
|
|
|
— |
|
|
|
(5,396 |
) |
General and administrative |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
25,956 |
|
|
|
25,956 |
|
AISC, Before By-product Credits (1) |
|
|
141,137 |
|
|
|
65,418 |
|
|
|
— |
|
|
|
27,057 |
|
|
|
233,612 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Zinc |
|
|
(42,079 |
) |
|
|
(11,491 |
) |
|
|
— |
|
|
|
— |
|
|
|
(53,570 |
) |
Gold |
|
|
(55,395 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(55,395 |
) |
Lead |
|
|
(13,799 |
) |
|
|
(27,187 |
) |
|
|
— |
|
|
|
— |
|
|
|
(40,986 |
) |
Exclusion of Lucky Friday by-product credits |
|
|
— |
|
|
|
3,943 |
|
|
|
— |
|
|
|
— |
|
|
|
3,943 |
|
Total By-product credits |
|
|
(111,273 |
) |
|
|
(34,735 |
) |
|
|
— |
|
|
|
— |
|
|
|
(146,008 |
) |
Cash Cost, After By-product Credits |
|
$ |
8,967 |
|
|
$ |
14,106 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
23,073 |
|
AISC, After By-product Credits |
|
$ |
29,864 |
|
|
$ |
30,683 |
|
|
$ |
— |
|
|
$ |
27,057 |
|
|
$ |
87,604 |
|
Ounces produced |
|
|
4,722 |
|
|
|
2,369 |
|
|
|
|
|
|
|
|
|
7,091 |
|
||
Exclusion of Lucky Friday ounces produced |
|
|
— |
|
|
|
(253 |
) |
|
|
|
|
|
|
|
|
(253 |
) |
||
Divided by ounces produced |
|
|
4,722 |
|
|
|
2,116 |
|
|
|
|
|
|
|
|
|
6,838 |
|
||
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
25.46 |
|
|
$ |
23.08 |
|
|
|
|
|
|
|
|
$ |
24.73 |
|
||
By-product credits per ounce |
|
|
(23.56 |
) |
|
|
(16.41 |
) |
|
|
|
|
|
|
|
|
(21.35 |
) |
||
Cash Cost, After By-product Credits, per Ounce |
|
$ |
1.90 |
|
|
$ |
6.67 |
|
|
|
|
|
|
|
|
$ |
3.38 |
|
||
AISC, Before By-product Credits, per Ounce |
|
$ |
29.89 |
|
|
$ |
30.91 |
|
|
|
|
|
|
|
|
$ |
34.16 |
|
||
By-product credits per ounce |
|
|
(23.56 |
) |
|
|
(16.41 |
) |
|
|
|
|
|
|
|
|
(21.35 |
) |
||
AISC, After By-product Credits, per Ounce |
|
$ |
6.33 |
|
|
$ |
14.50 |
|
|
|
|
|
|
|
|
$ |
12.81 |
|
||
50
In thousands (except per ounce amounts) |
|
Six Months Ended June 30, 2024 |
|
|||||||||
|
|
Casa Berardi |
|
|
Other (4) |
|
|
Total Gold |
|
|||
Total cost of sales |
|
$ |
125,600 |
|
|
$ |
7,513 |
|
|
$ |
133,113 |
|
Depreciation, depletion and amortization |
|
|
(49,961 |
) |
|
|
— |
|
|
|
(49,961 |
) |
Treatment costs |
|
|
76 |
|
|
|
— |
|
|
|
76 |
|
Change in product inventory |
|
|
1,189 |
|
|
|
— |
|
|
|
1,189 |
|
Reclamation and other costs |
|
|
(415 |
) |
|
|
— |
|
|
|
(415 |
) |
Exclusion of Other costs |
|
|
— |
|
|
|
(7,513 |
) |
|
|
(7,513 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
76,489 |
|
|
|
— |
|
|
|
76,489 |
|
Reclamation and other costs |
|
|
415 |
|
|
|
— |
|
|
|
415 |
|
Sustaining capital |
|
|
7,528 |
|
|
|
— |
|
|
|
7,528 |
|
AISC, Before By-product Credits (1) |
|
|
84,432 |
|
|
|
— |
|
|
|
84,432 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|||
Silver |
|
|
(326 |
) |
|
|
— |
|
|
|
(326 |
) |
Total By-product credits |
|
|
(326 |
) |
|
|
— |
|
|
|
(326 |
) |
Cash Cost, After By-product Credits |
|
$ |
76,163 |
|
|
$ |
— |
|
|
$ |
76,163 |
|
AISC, After By-product Credits |
|
$ |
84,106 |
|
|
$ |
— |
|
|
$ |
84,106 |
|
Divided by ounces produced |
|
|
45 |
|
|
|
— |
|
|
|
45 |
|
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
1,692 |
|
|
$ |
— |
|
|
$ |
1,692 |
|
By-product credits per ounce |
|
|
(7 |
) |
|
|
— |
|
|
|
(7 |
) |
Cash Cost, After By-product Credits, per Ounce |
|
$ |
1,685 |
|
|
$ |
— |
|
|
$ |
1,685 |
|
AISC, Before By-product Credits, per Ounce |
|
$ |
1,868 |
|
|
$ |
— |
|
|
$ |
1,868 |
|
By-product credits per ounce |
|
|
(7 |
) |
|
|
— |
|
|
|
(7 |
) |
AISC, After By-product Credits, per Ounce |
|
$ |
1,861 |
|
|
$ |
— |
|
|
$ |
1,861 |
|
51
In thousands (except per ounce amounts) |
|
Six Months Ended June 30, 2024 |
|
|||||||||
|
|
Total Silver |
|
|
Total Gold |
|
|
Total |
|
|||
Total cost of sales |
|
$ |
231,482 |
|
|
$ |
133,113 |
|
|
$ |
364,595 |
|
Depreciation, depletion and amortization |
|
|
(52,709 |
) |
|
|
(49,961 |
) |
|
|
(102,670 |
) |
Treatment costs |
|
|
21,762 |
|
|
|
76 |
|
|
|
21,838 |
|
Change in product inventory |
|
|
5,596 |
|
|
|
1,189 |
|
|
|
6,785 |
|
Reclamation and other costs |
|
|
(1,950 |
) |
|
|
(415 |
) |
|
|
(2,365 |
) |
Exclusion of Lucky Friday cash costs |
|
|
(3,634 |
) |
|
|
— |
|
|
|
(3,634 |
) |
Exclusion of Keno Hill cash costs |
|
|
(31,466 |
) |
|
|
— |
|
|
|
(31,466 |
) |
Exclusion of Other costs |
|
|
— |
|
|
|
(7,513 |
) |
|
|
(7,513 |
) |
Cash Cost, Before By-product Credits (1) |
|
|
169,081 |
|
|
|
76,489 |
|
|
|
245,570 |
|
Reclamation and other costs |
|
|
1,975 |
|
|
|
415 |
|
|
|
2,390 |
|
Sustaining capital |
|
|
41,996 |
|
|
|
7,528 |
|
|
|
49,524 |
|
Exclusion of Lucky Friday sustaining costs |
|
|
(5,396 |
) |
|
|
— |
|
|
|
(5,396 |
) |
General and administrative |
|
|
25,956 |
|
|
|
— |
|
|
|
25,956 |
|
AISC, Before By-product Credits (1) |
|
|
233,612 |
|
|
|
84,432 |
|
|
|
318,044 |
|
By-product credits: |
|
|
|
|
|
|
|
|
|
|||
Zinc |
|
|
(53,570 |
) |
|
|
— |
|
|
|
(53,570 |
) |
Gold |
|
|
(55,395 |
) |
|
|
— |
|
|
|
(55,395 |
) |
Lead |
|
|
(40,986 |
) |
|
|
— |
|
|
|
(40,986 |
) |
Silver |
|
|
— |
|
|
|
(326 |
) |
|
|
(326 |
) |
Exclusion of Lucky Friday by-product credits |
|
|
3,943 |
|
|
|
— |
|
|
|
3,943 |
|
Total By-product credits |
|
|
(146,008 |
) |
|
|
(326 |
) |
|
|
(146,334 |
) |
Cash Cost, After By-product Credits |
|
$ |
23,073 |
|
|
$ |
76,163 |
|
|
$ |
99,236 |
|
AISC, After By-product Credits |
|
$ |
87,604 |
|
|
$ |
84,106 |
|
|
$ |
171,710 |
|
Ounces produced |
|
$ |
7,091 |
|
|
$ |
45 |
|
|
|
|
|
Exclusion of Lucky Friday ounces produced |
|
$ |
(253 |
) |
|
$ |
— |
|
|
|
|
|
Divided by ounces produced |
|
|
6,838 |
|
|
|
45 |
|
|
|
|
|
Cash Cost, Before By-product Credits, per Ounce |
|
$ |
24.73 |
|
|
$ |
1,692 |
|
|
|
|
|
By-product credits per ounce |
|
|
(21.35 |
) |
|
|
(7 |
) |
|
|
|
|
Cash Cost, After By-product Credits, per Ounce |
|
$ |
3.38 |
|
|
$ |
1,685 |
|
|
|
|
|
AISC, Before By-product Credits, per Ounce |
|
$ |
34.16 |
|
|
$ |
1,868 |
|
|
|
|
|
By-product credits per ounce |
|
|
(21.35 |
) |
|
|
(7 |
) |
|
|
|
|
AISC, After By-product Credits, per Ounce |
|
$ |
12.81 |
|
|
$ |
1,861 |
|
|
|
|
|
Financial Liquidity and Capital Resources
52
We have a disciplined cash management strategy of maintaining financial flexibility to execute our capital priorities and provide long-term value to our stockholders. Consistent with that strategy, we aim to maintain an acceptable level of net debt and sufficient liquidity to fund debt service costs, operations, capital expenditures, exploration and pre-development projects, while returning cash to stockholders through dividends and potential share repurchases.
At June 30, 2025, we had $296.6 million in cash and cash equivalents, of which $2.9 million was held in foreign subsidiaries' local currency that we anticipate utilizing for near-term operating, exploration or capital costs by those foreign subsidiaries. At June 30, 2025, we had $39.0 million drawn on our $225 million credit facility, and additional $6.7 million used for letters of credit, leaving $179.3 million for additional borrowings. We also have USD cash and cash equivalent balances held by our foreign subsidiaries that, if repatriated, may be subject to withholding taxes. We expect that there would be no additional tax burden upon repatriation after considering the cash cost associated with the withholding taxes. We believe that our liquidity and capital resources from our U.S. operations are adequate to fund our U.S. operations and corporate activities.
Pursuant to our common stock dividend policy described in Note 12 of Notes to Consolidated Financial Statements in our consolidated financial statements and notes for the year ended December 31, 2024, our Board of Directors declared and paid dividends on our common and preferred stock of $2.5 million and $5.0 million during the three and six months ended June 30, 2025, and $4.0 million and $8.0 million during the three and six months ended June 30, 2024, respectively. Our common stock dividend policy anticipates paying an annual minimum dividend of $0.015 per share. Prior to the first quarter of 2025, our dividend policy previously had an additional silver-linked component which tied the amount of declared common stock dividends to our realized silver price for the preceding quarter.
The declaration and payment of dividends on our common stock is at the sole discretion of our Board of Directors, and there can be no assurance that we will continue to declare and pay common stock dividends in the future.
Pursuant to our stock repurchase program described in Note 12 of Notes to Consolidated Financial Statements in our consolidated financial statements and notes for the year ended December 31, 2024, we are authorized to repurchase up to 20 million shares of our outstanding common stock from time to time in open market or privately negotiated transactions, depending on prevailing market conditions and other factors. The repurchase program may be modified, suspended or discontinued by us at any time. Whether or not we engage in repurchases from time to time may depend on a variety of factors, including not only price and cash resources, but customary black-out restrictions, whether we have any material inside information, limitations on share repurchases or cash usage that may be imposed by our credit agreement or in connection with issuances of securities, alternative uses for cash, applicable law, and other investment opportunities from time to time. As of June 30, 2025 and December 31, 2024, 934,100 shares had been purchased in prior periods at an average price of $3.99 per share, leaving 19.1 million shares that may yet be purchased under the program. We have not repurchased any shares since June 2014.
As discussed in Note 6 of Notes to Condensed Consolidated Financial Statements (Unaudited) pursuant to an equity distribution agreement dated February 18, 2021, as of June 30, 2025, there were 7,147,780 remaining shares of our common stock that we may offer and sell from time to time in “at-the-market” offerings. Sales of the shares, if any, will be made by means of ordinary brokers transactions or as otherwise agreed between the Company and the agents as principals. Whether or not we engage in sales from time to time may depend on a variety of factors, including share price, our cash resources, customary black-out restrictions, and whether we have any material inside information. The equity distribution agreement can be terminated by us at any time. Any sales of shares under that agreement are registered under the Securities Act of 1933, as amended, pursuant to a shelf registration statement on Form S-3. During the six months ended June 30, 2025, we sold 29,008,536 shares under the agreement. Subsequent to June 30, 2025, we sold an additional 6,949,792 shares, leaving 197,988 remaining shares of our common stock that may be sold under the equity distribution agreement.
As a result of our current cash balances, the performance of our current and expected operations, current metals prices, proceeds from potential at-the-market sales of common stock, and availability under our Credit Agreement, we believe we will be able to meet our obligations and other potential cash requirements during the next 12 months and beyond. Our obligations and other uses of cash may include, but are not limited to: debt service obligations related to the Senior Notes; principal and interest payments under our Credit Agreement; ramp up and suspension costs; capital expenditures at our operations; potential acquisitions of other mining companies or properties; regulatory matters; litigation; potential repurchases of our common stock under the program described above; and payment of dividends on common stock, if declared by our Board of Directors. The IQ Notes were fully repaid on July 9, 2025, and on August 1, 2025, we issued a notice of redemption for a portion of our Senior Notes. See Note 13 of Notes to Condensed Consolidated Financial Statements (Unaudited) for more information.
We currently estimate a range of approximately $222 to $242 million (before any lease financing) will be invested in 2025 on capital expenditures, primarily for equipment, infrastructure, and development at our mines, including $112.1 million already incurred as of June 30, 2025. We also estimate exploration and pre-development expenditures will total approximately $28.0 million in 2025, including $13.3 million already incurred as of June 30, 2025. Our expenditures for these items and our related plans for 2025 may change based upon our financial position, metals prices, and other considerations. Our ability to fund the activities described above will
53
depend on our operating performance, metals prices, our ability to estimate revenues and costs, sources of liquidity available to us, including the revolving credit facility (which requires compliance with certain financial and other covenants), and other factors. A sustained downturn in metals prices, significant increase in operational or capital costs or other uses of cash, poor results of our operating units, our inability to access the credit facility or the sources of liquidity discussed above, or other factors beyond our control could impact our plans.
We may defer some capital investment and/or exploration and pre-development activities, engage in asset sales or secure additional capital if necessary to maintain liquidity. We may also pursue additional acquisition opportunities, which could require additional equity issuances or other forms of financing. There can be no assurance that such financing will be available to us.
Our liquid assets include (in millions):
|
|
June 30, 2025 |
|
|
December 31, 2024 |
|
||
Cash and cash equivalents held in U.S. dollars |
|
$ |
293.7 |
|
|
$ |
24.5 |
|
Cash and cash equivalents held in foreign currency |
|
|
2.9 |
|
|
|
2.4 |
|
Total cash and cash equivalents |
|
|
296.6 |
|
|
|
26.9 |
|
Marketable equity securities - non-current |
|
|
43.4 |
|
|
|
33.2 |
|
Total cash, cash equivalents and investments |
|
$ |
340.0 |
|
|
$ |
60.1 |
|
Cash and cash equivalents increased by $269.7 million in the first six months of 2025. Cash held in foreign currencies represents balances in Canadian dollars and Mexican Pesos. The value of non-current marketable equity securities increased by $10.2 million.
|
|
Six Months Ended |
|
|||||
|
|
June 30, 2025 |
|
|
June 30, 2024 |
|
||
Cash provided by operating activities (in millions) |
|
$ |
197.5 |
|
|
$ |
95.8 |
|
Cash provided by operating activities for the six months ended June 30, 2025, of $197.5 million represents a $101.7 million increase compared to the $95.8 million of cash provided by operations during the same period of 2024. $62.8 million of the variance was attributable to higher income adjusted for non-cash items, reflecting higher net income driven by higher revenues, partly offset by lower non-cash depreciation, depletion and amortization expense, and a working capital improvement of $39.0 million primarily driven by lower accounts receivable and inventory, in addition to an accounts payable build.
|
|
Six Months Ended |
|
|||||
|
|
June 30, 2025 |
|
|
June 30, 2024 |
|
||
Cash used in investing activities (in millions) |
|
$ |
(108.3 |
) |
|
$ |
(96.8 |
) |
During the six months ended June 30, 2025, we invested $112.1 million in capital expenditures, an increase of $14.1 million compared to the same period in 2024. Cash used in investing activities of $108.3 million includes $3.7 million of proceeds received from the sale of investments.
|
|
Six Months Ended |
|
|||||
|
|
June 30, 2025 |
|
|
June 30, 2024 |
|
||
Cash provided by financing activities (in millions) |
|
$ |
180.0 |
|
|
$ |
(79.6 |
) |
During the six months ended June 30, 2025, we had net borrowings of $16.0 million on our revolving credit facility resulting in $39.0 million outstanding at an interest rate of 6.7% on June 30, 2025. In addition, during the six months ended June 30, 2025 and 2024:
54
Contractual Obligations, Contingent Liabilities and Commitments
The table below presents our fixed, non-cancelable contractual obligations and commitments primarily related to our Senior Notes, IQ Notes, credit facility, outstanding purchase orders (including certain capital expenditures) and lease arrangements as of June 30, 2025 (in thousands):
|
|
Payments Due By Period |
|
|||||||||||||||||
|
|
Less than 1 year |
|
|
1-3 years |
|
|
4-5 years |
|
|
More than |
|
|
Total |
|
|||||
Purchase obligations (1) |
|
$ |
37,922 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
37,922 |
|
Credit facility(2) |
|
|
1,422 |
|
|
|
2,690 |
|
|
|
39,074 |
|
|
|
— |
|
|
|
43,186 |
|
Finance lease commitments (3) |
|
|
9,061 |
|
|
|
8,357 |
|
|
|
2,318 |
|
|
|
— |
|
|
|
19,736 |
|
Operating lease commitments (4) |
|
|
2,566 |
|
|
|
2,505 |
|
|
|
2,162 |
|
|
|
4,798 |
|
|
|
12,031 |
|
Senior Notes (5) |
|
|
34,438 |
|
|
|
531,138 |
|
|
|
— |
|
|
|
— |
|
|
|
565,576 |
|
IQ Notes (6) |
|
|
36,511 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
36,511 |
|
Total contractual cash obligations |
|
$ |
121,920 |
|
|
$ |
544,690 |
|
|
$ |
43,554 |
|
|
$ |
4,798 |
|
|
$ |
714,962 |
|
We record liabilities for costs associated with mine closure, reclamation of land and other environmental matters. At June 30, 2025, our liabilities for these matters totaled $128.2 million. Future expenditures related to closure, reclamation and environmental expenditures at our sites are difficult to estimate, although we anticipate we will incur expenditures relating to these obligations over the next 30 years. For additional information relating to our environmental obligations, see Note 11 of Notes to Condensed Consolidated Financial Statements (Unaudited).
Critical Accounting Estimates
There have been no significant changes to the critical accounting estimates disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2024 Form 10-K.
55
Off-Balance Sheet Arrangements
At June 30, 2025, we had no existing off-balance sheet arrangements, as defined under SEC regulations, that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
Guarantor Subsidiaries
Presented below are Hecla’s unaudited interim condensed consolidating financial statements as required by Rule 3-10 of Regulation S-X of the Securities Exchange Act of 1934, as amended, resulting from the guarantees by certain of Hecla's subsidiaries of the Senior Notes and IQ Notes (see Note 7 of Notes to Condensed Consolidated Financial Statements (Unaudited) for more information). The Guarantors consist of the following of Hecla's 100%-owned subsidiaries: Hecla Limited; Silver Hunter Mining Company; Rio Grande Silver, Inc.; Hecla MC Subsidiary, LLC; Hecla Silver Valley, Inc.; Burke Trading, Inc.; Hecla Montana, Inc.; Revett Silver Company; RC Resources, Inc.; Troy Mine Inc.; Revett Exploration, Inc.; Revett Holdings, Inc.; Mines Management, Inc.; Newhi, Inc.; Montanore Minerals Corp.; Hecla Alaska LLC; Hecla Greens Creek Mining Company; Hecla Admiralty Company; Hecla Juneau Mining Company; Klondex Holdings Inc.; Klondex Gold & Silver Mining Co.; Klondex Midas Holdings Limited; Klondex Aurora Mine Inc.; Klondex Hollister Mine Inc.; Hecla Quebec, Inc.; and Alexco Resource Corp. We completed the offering of the Senior Notes on February 19, 2020 under our shelf registration statement previously filed with the SEC. We issued the IQ Notes in four equal tranches between July and October 2020.
The unaudited interim condensed consolidating financial statements below have been prepared from our financial information on the same basis of accounting as the unaudited interim condensed consolidated financial statements set forth elsewhere in this report. Investments in the subsidiaries are accounted for under the equity method. Accordingly, the entries necessary to consolidate Hecla, the Guarantors, and our non-guarantor subsidiaries are reflected in the intercompany eliminations column. In the course of preparing consolidated financial statements, we eliminate the effects of various transactions conducted between Hecla and its subsidiaries and among the subsidiaries. While valid at an individual subsidiary level, such activities are eliminated in consolidation because, when taken as a whole, they do not represent business activity with third-party customers, vendors, and other parties. Examples of such eliminations include the following:
56
Separate financial statements of the Guarantors are not presented because the guarantees by the Guarantors are joint and several and full and unconditional, except for certain customary release provisions, including: (1) the sale or disposal of all or substantially all of the assets of the Guarantor; (2) the sale or other disposition of the capital stock of the Guarantor; (3) the Guarantor is designated as an unrestricted entity in accordance with the applicable provisions of the indenture; (4) Hecla ceases to be a borrower as defined in the indenture; and (5) upon legal or covenant defeasance or satisfaction and discharge of the indenture.
Unaudited Interim Condensed Consolidating Balance Sheets
|
|
As of June 30, 2025 |
|
|||||||||||||||||
|
|
Parent |
|
|
Guarantors |
|
|
Non-Guarantors |
|
|
Eliminations |
|
|
Consolidated |
|
|||||
|
|
(in thousands) |
|
|||||||||||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents |
|
$ |
282,590 |
|
|
$ |
13,489 |
|
|
$ |
486 |
|
|
$ |
— |
|
|
$ |
296,565 |
|
Other current assets |
|
|
53,252 |
|
|
|
140,572 |
|
|
|
24,471 |
|
|
|
— |
|
|
|
218,295 |
|
Properties, plants, equipment and mineral interests, net |
|
|
603 |
|
|
|
2,705,732 |
|
|
|
8,104 |
|
|
|
— |
|
|
|
2,714,439 |
|
Intercompany receivable (payable) |
|
|
(367,109 |
) |
|
|
(730,040 |
) |
|
|
612,706 |
|
|
|
484,443 |
|
|
|
— |
|
Investments in subsidiaries |
|
|
2,386,402 |
|
|
|
(52 |
) |
|
|
— |
|
|
|
(2,386,350 |
) |
|
|
— |
|
Other non-current assets |
|
|
529,653 |
|
|
|
21,016 |
|
|
|
29,002 |
|
|
|
(499,615 |
) |
|
|
80,056 |
|
Total assets |
|
$ |
2,885,391 |
|
|
$ |
2,150,717 |
|
|
$ |
674,769 |
|
|
$ |
(2,401,522 |
) |
|
$ |
3,309,355 |
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities |
|
$ |
8,755 |
|
|
$ |
165,375 |
|
|
$ |
36,097 |
|
|
$ |
(17,265 |
) |
|
$ |
192,962 |
|
Long-term debt |
|
|
511,829 |
|
|
|
9,739 |
|
|
|
— |
|
|
|
— |
|
|
|
521,568 |
|
Non-current portion of accrued reclamation |
|
|
— |
|
|
|
117,839 |
|
|
|
1,487 |
|
|
|
— |
|
|
|
119,326 |
|
Non-current deferred tax liability |
|
|
54,772 |
|
|
|
98,202 |
|
|
|
— |
|
|
|
2,147 |
|
|
|
155,121 |
|
Other non-current liabilities |
|
|
— |
|
|
|
10,345 |
|
|
|
— |
|
|
|
— |
|
|
|
10,345 |
|
Stockholders' equity |
|
|
2,310,035 |
|
|
|
1,749,217 |
|
|
|
637,185 |
|
|
|
(2,386,404 |
) |
|
|
2,310,033 |
|
Total liabilities and stockholders' equity |
|
$ |
2,885,391 |
|
|
$ |
2,150,717 |
|
|
$ |
674,769 |
|
|
$ |
(2,401,522 |
) |
|
$ |
3,309,355 |
|
|
|
As of December 31, 2024 |
|
|||||||||||||||||
|
|
Parent |
|
|
Guarantors |
|
|
Non-Guarantors |
|
|
Eliminations |
|
|
Consolidated |
|
|||||
|
|
(in thousands) |
|
|||||||||||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents |
|
$ |
14,755 |
|
|
$ |
11,624 |
|
|
$ |
489 |
|
|
$ |
— |
|
|
$ |
26,868 |
|
Other current assets |
|
|
37,143 |
|
|
|
125,698 |
|
|
|
24,443 |
|
|
|
— |
|
|
$ |
187,284 |
|
Properties, plants, equipment and mineral interests - net |
|
|
603 |
|
|
|
2,685,407 |
|
|
|
8,109 |
|
|
|
— |
|
|
$ |
2,694,119 |
|
Intercompany receivable (payable) |
|
|
(437,765 |
) |
|
|
(650,923 |
) |
|
|
594,307 |
|
|
|
494,381 |
|
|
$ |
— |
|
Investments in subsidiaries |
|
|
2,451,783 |
|
|
|
(52 |
) |
|
|
— |
|
|
|
(2,451,731 |
) |
|
$ |
— |
|
Other non-current assets |
|
|
502,802 |
|
|
|
21,686 |
|
|
|
28,775 |
|
|
|
(480,474 |
) |
|
$ |
72,789 |
|
Total assets |
|
$ |
2,569,321 |
|
|
$ |
2,193,440 |
|
|
$ |
656,123 |
|
|
$ |
(2,437,824 |
) |
|
$ |
2,981,060 |
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities |
|
$ |
41,612 |
|
|
$ |
156,652 |
|
|
$ |
24,099 |
|
|
$ |
(24,525 |
) |
|
$ |
197,838 |
|
Long-term debt |
|
|
464,075 |
|
|
|
6,406 |
|
|
|
(37 |
) |
|
|
38,483 |
|
|
$ |
508,927 |
|
Non-current portion of accrued reclamation |
|
|
— |
|
|
|
109,650 |
|
|
|
1,512 |
|
|
|
— |
|
|
$ |
111,162 |
|
Non-current deferred tax liability |
|
|
24,122 |
|
|
|
86,141 |
|
|
|
3 |
|
|
|
— |
|
|
$ |
110,266 |
|
Other non-current liabilities |
|
|
— |
|
|
|
13,353 |
|
|
|
— |
|
|
|
— |
|
|
$ |
13,353 |
|
Stockholders' equity |
|
|
2,039,512 |
|
|
|
1,821,238 |
|
|
|
630,546 |
|
|
|
(2,451,782 |
) |
|
$ |
2,039,514 |
|
Total liabilities and stockholders' equity |
|
$ |
2,569,321 |
|
|
$ |
2,193,440 |
|
|
$ |
656,123 |
|
|
$ |
(2,437,824 |
) |
|
$ |
2,981,060 |
|
Unaudited Interim Condensed Consolidating Statements of Operations
57
|
|
Six Months Ended June 30, 2025 |
|
|||||||||||||||||
|
|
Parent |
|
|
Guarantors |
|
|
Non-Guarantors |
|
|
Eliminations |
|
|
Consolidated |
|
|||||
|
|
(in thousands) |
|
|||||||||||||||||
Revenues |
|
$ |
(1,266 |
) |
|
$ |
566,632 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
565,366 |
|
Cost of sales |
|
|
(2,832 |
) |
|
|
(293,462 |
) |
|
|
— |
|
|
|
— |
|
|
|
(296,294 |
) |
Depreciation, depletion, amortization |
|
|
— |
|
|
|
(75,544 |
) |
|
|
— |
|
|
|
— |
|
|
|
(75,544 |
) |
General and administrative |
|
|
(9,341 |
) |
|
|
(14,100 |
) |
|
|
(1,098 |
) |
|
|
— |
|
|
|
(24,539 |
) |
Exploration and pre-development |
|
|
(200 |
) |
|
|
(12,295 |
) |
|
|
(815 |
) |
|
|
— |
|
|
|
(13,310 |
) |
Equity in earnings of subsidiaries |
|
|
68,572 |
|
|
|
— |
|
|
|
— |
|
|
|
(68,572 |
) |
|
|
— |
|
Other income (expense) |
|
|
62,768 |
|
|
|
(51,156 |
) |
|
|
(4,997 |
) |
|
|
(27,011 |
) |
|
|
(20,396 |
) |
Income before income and mining taxes |
|
|
117,701 |
|
|
|
120,075 |
|
|
|
(6,910 |
) |
|
|
(95,583 |
) |
|
|
135,283 |
|
Benefit (provision) from income taxes |
|
|
(31,124 |
) |
|
|
(42,509 |
) |
|
|
(2,084 |
) |
|
|
27,011 |
|
|
|
(48,706 |
) |
Net income |
|
|
86,577 |
|
|
|
77,566 |
|
|
|
(8,994 |
) |
|
|
(68,572 |
) |
|
|
86,577 |
|
Preferred stock dividends |
|
|
(276 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(276 |
) |
Income applicable to common stockholders |
|
$ |
86,301 |
|
|
$ |
77,566 |
|
|
$ |
(8,994 |
) |
|
$ |
(68,572 |
) |
|
$ |
86,301 |
|
Net income |
|
|
86,577 |
|
|
|
77,566 |
|
|
|
(8,994 |
) |
|
|
(68,572 |
) |
|
|
86,577 |
|
Changes in comprehensive income |
|
|
5,687 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,687 |
|
Comprehensive income |
|
$ |
92,264 |
|
|
$ |
77,566 |
|
|
$ |
(8,994 |
) |
|
$ |
(68,572 |
) |
|
$ |
92,264 |
|
58
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The following discussion about our exposure to market risks and risk management activities includes forward-looking statements that involve risks and uncertainties, as well as summarizes the financial instruments held by us at June 30, 2025, which are sensitive to changes in commodity prices and foreign exchange rates and are not held for trading purposes. Actual results could differ materially from those projected in the forward-looking statements. In the normal course of business, we also face risks that are either non-financial or non-quantifiable (See Part I, Item 1A. – Risk Factors of our 2024 Form 10-K).
Metals Prices
Changes in the market prices of silver, gold, lead, zinc and copper can significantly affect our profitability and cash flow. Metals prices can and often do fluctuate widely and are affected by numerous factors beyond our control (see Item 1A – Risk Factors – A substantial or extended decline in metals prices would have a material adverse effect on us in our 2024 Form 10-K). We utilize collars and financially-settled forward and put option contracts to manage our exposure to changes in prices for silver, gold, zinc and lead.
Provisional Sales
Sales of all metals products sold directly to customers, including by-product metals, are recorded as revenues when all performance obligations have been completed and the transaction price can be determined or reasonably estimated. For concentrate sales, revenues are generally recorded at the time of shipment at forward prices for the estimated month of settlement. Due to the time elapsed between shipment to the customer and the final settlement with the customer, we must estimate the prices at which sales of our metals will be settled. Previously recorded sales are adjusted to estimated settlement metals prices until final settlement by the customer. Changes in metals prices between shipment and final settlement will result in changes to revenues previously recorded upon shipment. Metals prices can and often do fluctuate widely and are affected by numerous factors beyond our control (see Item 1A – Risk Factors – A substantial or extended decline in metals prices would have a material adverse effect on us in our 2024 Form 10-K). At June 30, 2025, metals contained in concentrate sales and exposed to future price changes totaled 0.9 million ounces of silver, 750 ounces of gold, 9,475 tons of zinc and 4,825 tons of lead. If the price for each metal were to change by 10%, the change in the total value of the concentrates sold would be approximately $7.3 million. As discussed in Note 8 of Notes to Condensed Consolidated Financial Statements (Unaudited), we utilize a program designed and intended to mitigate the risk of negative price adjustments with limited mark-to-market financially-settled forward contracts for our silver, gold, zinc, lead and copper sales.
Commodity-Price Risk Management
See Note 8 of Notes to Condensed Consolidated Financial Statements (Unaudited) for a description of our commodity-price risk management program.
Foreign Currency Risk Management
We operate and have mining interests in Canada, which exposes us to risks associated with fluctuations in the exchange rates between the USD and the CAD. We determined the functional currency for our Canadian operations is the USD. As such, foreign exchange gains and losses associated with the re-measurement of monetary assets and liabilities from CAD to USD are recorded to earnings each period. For the three and six months ended June 30, 2025, we recognized a net foreign exchange loss of $3.5 million and $3.9 million, compared to a net foreign exchange gain of $2.7 million and $6.7 million for the three and six months ended June 30, 2024. Foreign currency exchange rates are influenced by a number of factors beyond our control. A 10% change in the exchange rate between the USD and CAD from the rate at June 30, 2025 would have resulted in a change of approximately $7.2 million in our net foreign exchange gain or loss. We do not hedge the remeasurement of monetary assets and liabilities. We do hedge some of our operating and capital costs denominated in CAD.
See Note 9 of Notes to Condensed Consolidated Financial Statements (Unaudited) for a description of our foreign currency risk management program.
59
Item 4. Controls and Procedures
An evaluation was performed under the supervision and with the participation of our management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of our disclosure controls and procedures as required by Securities Exchange Act Rules 13a-15(e) and 15d-15(e) as of the end of the period covered by this report. Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures, including controls and procedures designed to ensure that information required to be disclosed by us is accumulated and communicated to our management (including our CEO and CFO), were effective as of June 30, 2025, in assuring them in a timely manner that material information required to be disclosed in this report has been properly recorded, processed, summarized and reported. There were no changes in our internal control over financial reporting during the three months ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Internal control systems, no matter how well designed and operated, have inherent limitations. Therefore, even a system which is determined to be effective cannot provide absolute assurance that all control issues have been detected or prevented. Our systems of internal controls are designed to provide reasonable assurance with respect to financial statement preparation and presentation.
60
Part II - Other Information
Hecla Mining Company and Subsidiaries
Item 1. Legal Proceedings
For information concerning legal proceedings, refer to Note 11 of Notes to Condensed Consolidated Financial Statements (Unaudited), which is incorporated by reference into this Item 1.
Item 1A. Risk Factors
Item 1A. – Risk Factors of our 2024 Form 10-K set forth information relating to important risks and uncertainties that could materially adversely affect our business, financial condition or operating results.
Tariffs, other import/export regulations, or trade disputes between the United States and other jurisdictions may have a negative effect on global economic conditions and on our business, financial results and financial condition.
There remains risk and uncertainty to our business and the global economy surrounding tariffs imposed by the Trump Administration and possible reciprocal tariffs announced by other countries. On July 6, 2025, Treasury Secretary Scott Bessent announced that countries that have not reached trade deals with the United States by August 1 will no longer be subject to a pause of the country-specific tariff rates previously announced on April 2. In addition, on July 7, the administration sent letters setting country-specific tariff rates for several countries with whom the U.S. has not reached trade deals, including Japan and South Korea, with tariffs set for each at 25% on all goods effective August 1. On July 22 and July 31, Japan and South Korea, respectively, reached trade deals with the United States, reducing their export tariff rates to 15%. To date, neither nation has reciprocated with tariffs that impact our products sold therein.
Currently, we sell our products into Japan and South Korea, as well as Canada, and we have recently had sales into China. We have very little sales in the United States. As of the date of this report, neither Japan nor South Korea have announced plans to implement reciprocal tariffs on U.S. imports in response to the U.S.-announced tariffs. While the impacts of tariffs on us to date have been immaterial to the sales of our products, reciprocal tariffs could make it more expensive for us to export our products to affected countries, including Japan and South Korea. This creates risk for us that customers in those or other tariff-impacted countries will seek to renegotiate existing agreements with us, seek to shift some or all of their increased costs to us in future agreements, break or terminate agreements with us if they are deemed uneconomic to the customer, or take other actions, any of which alone or in combination could materially adversely impact our business, financial condition, and results of operations. Further, any materials that we import to the U.S. from countries subject to tariffs could become more expensive if subject to a tariff, which could also have a material adverse impact on our business, financial condition, and results of operations.
In addition to possible impacts directly on our business, tariffs or other trade obstacles could have a material adverse effect on global economic conditions and the stability of global financial markets, and they may significantly reduce global trade. Any of these factors could depress economic activity, impact U.S. dollar/foreign currency exchange rates, restrict our access to customers and have a material adverse effect on our business, financial condition and results of operations.
Item 4. Mine Safety Disclosures
The information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in exhibit 95 to this Quarterly Report.
Item 5. Other Information
During the three months ended June 30, 2025, no director or officer of the Company
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Item 6. Exhibits
Hecla Mining Company and Wholly Owned Subsidiaries
Form 10-Q – June 30, 2025
Index to Exhibits
Exhibit Number |
|
Description |
3.1 |
|
Restated Certificate of Incorporation of Hecla Mining Company. Filed as exhibit 3.1 to Registrant’s Current Report on form 8-K filed on May 22, 2025 (File No. 1-08491) and incorporated herein by reference. |
10.1 |
|
Form of Indemnification Agreement dated May 21, 2025, between Registrant and Dean Gehring. Identical Indemnification Agreements were entered into between the Registrant and Charles B. Stanley on May 4, 2007, David C. Sienko on January 29, 2010, Robert D. Brown on January 4, 2016, Stephen F. Ralbovsky and George R. Johnson on March 1, 2016, Catherine J. Boggs on January 1, 2017, Alice Wong on February 26, 2021, Michael L. Clary on March 1, 2020, Russell D. Lawlar on March 1, 2021, Kurt Allen on July 1, 2021, Carlos Aguiar on August 16, 2023, Mark P. Board on February 22, 2024, Jill Satre on October 16, 2024, Rob Krcmarov on November 7, 2024, and Patrick Malone on April 7, 2025. Filed as exhibit 10.7 to Registrant’s Form 10-K for the year ended December 31, 2024 (File No. 1-8491) and incorporated herein by reference. (1) |
10.2 |
|
Hecla Mining Company 2010 Stock Incentive Plan – Notice of Award of Restricted Stock Units, as amended and effective June 6, 2025. (1)* |
10.3 |
|
Hecla Mining Company 2010 Stock Incentive Plan – Notice of Award of Performance-based Stock Units, as amended and effective June 6, 2025. (1)* |
10.4 |
|
Form of Change in Control and Severance Agreement dated June 5, 2025, between Registrant and each of Kurt Allen, Carlos Aguiar, Michael Clary, and Robert Brown. Identical Change in Control and Severance Agreements entered into between the Registrant and Rob Krcmarov on November 7, 2024 and between the Registrant and each of Russell Lawlar and David Sienko on June 20, 2025. Filed as exhibit 10.3 to Registrant’s Current Report on Form 8-K on November 4, 2024 (File No. 1-8491) and incorporated herein by reference. (1) |
31.1* |
|
Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2* |
|
Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.1* |
|
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
32.2* |
|
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
95* |
|
Mine safety information listed in Section 1503 of the Dodd-Frank Act. |
101.INS |
|
Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document. ** |
101.SCH |
|
Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Documents ** |
104 |
|
Cover page formatted as Inline XBRL and contained in Exhibit 101 ** |
* Filed herewith
** XBRL information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
(1) Indicates a management contract or compensatory plan or arrangement.
Items 2 and 3 of Part II are not applicable and are omitted from this report.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
HECLA MINING COMPANY |
|
|
|
(Registrant) |
|
|
|
|
|
Date: |
August 6, 2025 |
By: |
/s/ Rob Krcmarov |
|
|
|
Rob Krcmarov, President and Chief Executive Officer, |
|
|
|
Director |
|
|
|
|
Date: |
August 6, 2025 |
By: |
/s/ Russell D. Lawlar |
|
|
|
Russell D. Lawlar, Senior Vice President, |
|
|
|
Chief Financial Officer |
63
Source:
FAQ
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