Record gold production, increased throughput and higher base metals
prices substantially reduced cash costs, after by-product credits, per
gold and silver ounce.
Company Website:
http://www.hecla-mining.com
COEUR D'ALENE, Idaho -- (Business Wire)
Hecla Mining Company (NYSE:HL)
today announced third quarter financial and operating results.
HIGHLIGHTS (Compared to Third Quarter of 2016)
-
Net income applicable to common stockholders of $1.3 million, or $0.00
per share.
-
Adjusted net income applicable to common stockholders of $16.0
million, or $0.04 per share.1
-
Cost of sales and other direct production costs and depreciation,
depletion and amortization ("cost of sales") of $97.2 million.
-
Silver cash cost, after by-product credits, of negative $0.63 per
ounce, the lowest in 7 years.2
-
All in sustaining cost ("AISC"), after by-product credits, of $6.65
per silver ounce, down 47%.3
-
Gold production of 63,046 ounces, up 21% as a result of strongest
performance of Casa Berardi since its acquisition.
-
Capital expenditures of $24.4 million, a 44% decline.
-
Cash and cash equivalents and short-term investments of $205.9 million
at September 30, 2017, up $4 million over the second quarter.
-
Lowering estimates for annual cash cost, after by-product credits, per
silver ounce for Greens Creek and San Sebastian.
-
The strike by the union workers at Lucky Friday continues.
"The third quarter continued Hecla's strong operating performance, which
coupled with higher zinc and lead prices, resulted in silver cash costs,
after by-product credits, of negative $0.63 per ounce, the lowest in 7
years and allows us to lower our cost guidance," said Phillips S. Baker
Jr., President and CEO. "Both Casa Berardi and Greens Creek set records
for throughput and San Sebastian had its strongest silver production of
the year. The operating performance combined with lower capital
expenditure allows Hecla to continue to generate positive cash flow and
strengthen our balance sheet."
FINANCIAL OVERVIEW
|
|
|
| |
|
| |
| | | | Third Quarter Ended | | | Nine Months Ended |
HIGHLIGHTS |
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
FINANCIAL DATA |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales (000)
| | | | $140,839 |
|
|
$179,393
| | | $417,662 |
|
|
$481,712
|
Gross profit (000)
| | | | $43,637 | | |
$58,685
| | | $109,760 | | |
$147,958
|
Income applicable to common shareholders (000)
| | | | $1,274 | | |
$25,651
| | | $3,816 | | |
$48,871
|
Basic and diluted income per common share
| | | | $— | | |
$0.07
| | | $0.01 | | |
$0.13
|
Net income (000)
| | | | $1,412 | | |
$25,789
| | | $4,230 | | |
$49,285
|
Cash provided by operating activities (000)
| | | | $28,294 | | |
$86,976
| | | $74,115 | | |
$173,114
|
| | | | | | | | | | | | |
|
Net income applicable to common shareholders for the third quarter was
$1.3 million, or $0.00 per share, compared to $25.7 million, or $0.07
per share, for the same period a year ago, the result mainly due to the
following items:
-
Sales of $140.8 million impacted by the ongoing strike at Lucky Friday
and build-up of product inventory during the quarter of approximately
$12.9 million, primarily due to the timing of concentrate shipments at
Greens Creek.
-
Lower realized silver and gold prices, partially offset by higher zinc
and lead prices.
-
Mark to market loss on base metal derivatives contracts of $11.2
million due to the higher zinc and lead prices, compared to the third
quarter of 2016 when there wasn't an active hedging program.
-
Net foreign exchange loss of $4.8 million versus a gain of $2.4
million in third quarter of 2016 due to the strength of the Canadian
dollar.
-
Interest expense, net of amount capitalized, of $9.4 million in the
third quarter of 2017, increased over the $5.6 million recognized in
the third quarter of 2016, primarily due to interest being capitalized
in the 2016 period related to construction of the #4 Shaft.
-
An increase of $4.6 million in exploration and pre-development
expenditures over the third quarter of 2016, particularly focused on
San Sebastian and Casa Berardi.
-
Lucky Friday suspension costs of $3.7 million, along with $1.1 million
in non-cash depreciation expense, in the third quarter of 2017.
Limited production and capital improvements are being performed by
salaried staff.
Operating cash flow was $28.3 million compared to $87.0 million in the
third quarter of 2016, with the decrease due to the timing of
concentrate shipments, primarily at Greens Creek and increased payment
of estimated income taxes in Mexico. These factors were partially offset
by an increase in gold production and higher base metals prices.
Adjusted EBITDA was $60.8 million compared to $78.8 million in the third
quarter of 2016, with the decrease mainly due to lower and no
concentrate shipments at Greens Creek and Lucky Friday, respectively,
and lower precious metals prices, partially offset by an increase in
gold sales and higher base metals prices.4
Capital expenditures at the operations totaled $25.5 million for the
third quarter 2017 compared to $42.0 million in the third quarter of
2016, with the decrease due to completion of the #4 Shaft, limited
activity at Lucky Friday due to the ongoing strike, and reduced capital
spending at Greens Creek and Casa Berardi, partially offset by costs
related to underground development at San Sebastian. Expenditures were
$13.8 million at Casa Berardi, $8.2 million at Greens Creek,
$3.4 million at San Sebastian and $0.2 million at Lucky Friday.
Metals Prices
The average realized silver price in the third quarter was $17.01 per
ounce, 13% lower than the $19.53 price realized in the third quarter of
2016. The average realized gold price in the third quarter was $1,283
per ounce, 4% lower than the prior year period. Realized lead and zinc
prices increased by 27%, and 43% respectively, from the third quarter of
2016.
OPERATIONS OVERVIEW
Overview
The following table provides the production summary on a consolidated
basis for the third quarter and nine months ended September 30, 2017 and
2016:
|
| |
|
|
| |
|
| |
| | | | | | Third Quarter Ended | | | Nine Months Ended |
|
|
|
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
PRODUCTION SUMMARY |
|
|
|
|
|
|
|
|
|
Silver -
| |
Ounces produced
| | | | 3,323,157 |
|
|
4,316,663
| | | 9,500,058 |
|
|
13,200,765
|
| |
Payable ounces sold
| | | | 2,540,817 | | |
4,284,842
| | | 8,098,652 | | |
12,222,084
|
Gold -
| |
Ounces produced
| | | | 63,046 | | |
52,126
| | | 171,720 | | |
170,779
|
| |
Payable ounces sold
| | | | 57,380 | | |
50,348
| | | 161,921 | | |
161,217
|
Lead -
| |
Tons produced
| | | | 5,370 | | |
10,411
| | | 18,426 | | |
31,840
|
| |
Payable tons sold
| | | | 2,936 | | |
9,967
| | | 13,612 | | |
28,380
|
Zinc -
| |
Tons produced
| | | | 14,497 | | |
14,825
| | | 43,000 | | |
50,321
|
| |
Payable tons sold
| | | | 8,444 | | |
13,596
| | | 29,269 | | |
37,948
|
| | | | | | | | | | | | | | |
|
The following tables provide a summary of the final production, cost of
sales, cash cost, after by-product credits, per silver and gold ounce,
and AISC, after by-product credits, per silver and gold ounce for the
third quarter and nine months ended September 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter End |
|
|
| |
|
| |
|
| Greens Creek |
|
| Lucky Friday |
|
| Casa Berardi |
|
| San Sebastian |
September 30, 2017 |
|
|
| Silver |
|
| Gold |
|
| Silver |
|
| Gold |
|
| Silver |
|
| Gold |
|
| Silver |
|
| Silver |
|
| Gold |
Production (ounces) | | | | |
3,323,157
| | | | |
63,046
| | | | |
2,344,315
| |
|
|
12,563
| |
|
| |
88,298
| |
|
| |
44,141
| |
|
|
9,659
| |
|
| |
880,885
| |
|
|
6,342
| |
Increase/(decrease) over 2016 |
|
|
|
|
(23
|
)%
|
|
|
|
21
|
%
|
|
|
|
(4
|
)%
|
|
|
5
|
%
|
|
|
|
(90
|
)%
|
|
|
|
38
|
%
|
|
|
16
|
%
|
|
|
|
(10
|
)%
|
|
|
(23
|
)%
|
Cost of sales and other direct production costs and
depreciation, depletion and amortization (000) | | | |
$
|
48,606
| | | |
$
|
48,595
| | | |
$
|
41,927
| | | |
N/A
| | | |
$
|
—
| | | |
$
|
48,595
| | | |
N/A
| | | |
$
|
6,680
| | | |
N/A
| |
Increase/(decrease) over 2016 |
|
|
|
|
(42
|
)%
|
|
|
|
34
|
%
|
|
|
|
(28
|
)%
|
|
|
N/A
|
|
|
|
|
N/A
|
|
|
|
|
34
|
%
|
|
|
N/A
|
|
|
|
|
2
|
%
|
|
|
N/A
|
|
Cash costs, after by-product credits, per silver or gold ounce 2,5 | | | |
$
|
(0.63
|
)
| | |
$
|
750
| | | |
$
|
(0.15
|
)
| | |
N/A
| | | |
$
|
11.60
| | | |
$
|
750
| | | |
N/A
| | | |
$
|
(3.12
|
)
| | |
N/A
| |
Increase/(decrease) over 2016 |
|
|
|
|
(117
|
)%
|
|
|
|
(18
|
)%
|
|
|
|
(103
|
)%
|
|
|
N/A
|
|
|
|
|
28
|
%
|
|
|
|
(18
|
)%
|
|
|
N/A
|
|
|
|
|
23
|
%
|
|
|
N/A
|
|
AISC, after by-product credits, per silver or gold ounce 3 | | | |
$
|
6.65
| | | |
$
|
1,091
| | | |
$
|
4.47
| | | |
N/A
| | | |
$
|
13.37
| | | |
$
|
1,091
| | | |
N/A
| | | |
$
|
(0.83
|
)
| | |
N/A
| |
Increase/(decrease) over 2016 |
|
|
|
|
(47
|
)%
|
|
|
|
(24
|
)%
|
|
|
|
(59
|
)%
|
|
|
N/A
|
|
|
|
|
(34
|
)%
|
|
|
|
(24
|
)%
|
|
|
N/A
|
|
|
|
|
65
|
%
|
|
|
N/A
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended | | | | | | | | | | Greens Creek |
|
| Lucky Friday |
|
| Casa Berardi |
|
| San Sebastian |
September 30, 2017 |
|
|
| Silver |
|
| Gold |
|
| Silver |
|
| Gold |
|
| Silver |
|
| Gold |
|
| Silver |
|
| Silver |
|
| Gold |
Production (ounces) | | | | |
9,500,058
| | | | |
171,720
| | | | |
6,205,659
| | | |
39,289
| | | | |
769,080
| | | | |
113,209
| | | |
26,681
| | | | |
2,498,638
| | | |
19,222
| |
Increase/(decrease) over 2016 |
|
|
|
|
(28
|
)%
|
|
|
|
1
|
%
|
|
|
|
(12
|
)%
|
|
|
(1
|
)%
|
|
|
|
(72
|
)%
|
|
|
|
9
|
%
|
|
|
11
|
%
|
|
|
|
(27
|
)%
|
|
|
(29
|
)%
|
Cost of sales and other direct production costs and depreciation,
depletion and amortization (000) | | | |
$
|
173,160
| | | |
$
|
134,742
| | | |
$
|
140,241
| | | |
N/A
| | | |
$
|
14,542
| | | |
$
|
134,742
| | | |
N/A
| | | |
$
|
18,377
| | | |
N/A
| |
Increase/(decrease) over 2016 |
|
|
|
|
(24
|
)%
|
|
|
|
26
|
%
|
|
|
|
(5
|
)%
|
|
|
N/A
|
|
|
|
|
(74
|
)%
|
|
|
|
26
|
%
|
|
|
N/A
|
|
|
|
|
(22
|
)%
|
|
|
N/A
|
|
Cash costs, after by-product credits, per silver or gold ounce 2,5 | | | |
$
|
0.16
| | | |
$
|
858
| | | |
$
|
0.73
| | | |
N/A
| | | |
$
|
6.58
| | | |
$
|
858
| | | |
N/A
| | | |
$
|
(3.23
|
)
| | |
N/A
| |
Increase/(decrease) over 2016 |
|
|
|
|
(95
|
)%
|
|
|
|
14
|
%
|
|
|
|
(84
|
)%
|
|
|
N/A
|
|
|
|
|
(30
|
)%
|
|
|
|
14
|
%
|
|
|
N/A
|
|
|
|
|
5
|
%
|
|
|
N/A
|
|
AISC, after by-product credits, per silver or gold ounce 3 | | | |
$
|
8.06
| | | |
$
|
1,226
| | | |
$
|
5.60
| | | |
N/A
| | | |
$
|
12.21
| | | |
$
|
1,226
| | | |
N/A
| | | |
$
|
(0.14
|
)
| | |
N/A
| |
Increase/(decrease) over 2016 |
|
|
|
|
(32
|
)%
|
|
|
|
(1
|
)%
|
|
|
|
(45
|
)%
|
|
|
N/A
|
|
|
|
|
(43
|
)%
|
|
|
|
(1
|
)%
|
|
|
N/A
|
|
|
|
|
94
|
%
|
|
|
N/A
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
Greens Creek Mine - Alaska
At the Greens Creek mine, 2.3 million ounces of silver and 12,563 ounces
of gold were produced in the third quarter, compared to 2.4 million
ounces and 11,988 ounces, respectively, in the third quarter of 2016.
Lower silver production resulted from lower grades due to mine
sequencing. The mill operated at an average of 2,391 tons per day (tpd)
in the third quarter, a record and 9% higher than the third quarter of
2016.
The cost of sales for the third quarter was $41.9 million, and the cash
cost, after by-product credits, per silver ounce, was negative $0.15,
compared to $58.4 million and $4.80, respectively, for the third quarter
of 2016.2 The AISC, after by-product credits, was $4.47 per
silver ounce for the third quarter compared to $11.02 in the third
quarter of 2016.3 The per ounce silver costs were lower
primarily due to higher base metals prices and the number of tons milled.
Lucky Friday Mine - Idaho
At the Lucky Friday mine, 88,298 ounces of silver were produced in the
third quarter, compared to 887,364 ounces in the third quarter of 2016,
with the decrease due to the ongoing strike by unionized employees.
Limited production and capital improvements are being performed by
salaried staff.
There was no cost of sales for the third quarter, as there were no
concentrate shipments during the quarter, and the cash cost, after
by-product credits, per silver ounce, was $11.60, compared to $19.5
million and $9.07, respectively, for the third quarter of 2016.2
The AISC, after by-product credits, was $13.37 per silver ounce for the
third quarter compared to $20.22 in the third quarter of 2016, with the
decrease due to lower capital spending as a result of completion of the
#4 Shaft, partially offset by the costs of the ongoing strike.3
Casa Berardi - Quebec
At the Casa Berardi mine, a record 44,141 ounces of gold were produced
in the third quarter, including 8,949 ounces from the East Mine Crown
Pillar (EMCP) pit, compared to 31,949 ounces in the third quarter of
2016, with the increase primarily due to higher ore throughput and gold
grades. The mill operated at an average of 3,545 tpd in the third
quarter, an increase of 26% over the third quarter of 2016 due to ramp
up of the EMCP pit, and set a monthly throughput record of 3,913 tpd in
September.
The cost of sales was $48.6 million for the third quarter and the cash
cost, after by-product credits, per gold ounce was $750, compared to
$36.3 million and $915, respectively, in the prior year period.2,5
The decrease in cash cost, after by-product credits, per gold ounce is
due to the higher gold production and reduced stripping at the EMCP pit.
The AISC, after by-product credits, was $1,091 per gold ounce for the
third quarter compared to $1,442 in the third quarter of 2016, primarily
due to higher gold production, reduced stripping, and lower capital
spending.5
The higher gold grades and production are expected to continue in the
fourth quarter of 2017, combined with the reduced stripping costs at the
EMCP pit, the improved cash cost, after by-product credits, and the
AISC, after by-product credits, is anticipated to continue in the fourth
quarter.
Automation of the 985 drift, which is under construction, is on track
for commissioning by the end of the year, as are several other
innovations such as the control room.
San Sebastian - Mexico
At the San Sebastian mine, 880,885 ounces of silver and 6,342 ounces of
gold were produced in the third quarter, compared to 975,610 ounces and
8,189 ounces, respectively, in the third quarter of 2016. The lower
silver and gold production was expected with lower ore throughput and
lower gold grades. The mill operated at an average of 397 tpd in the
third quarter.
The cost of sales was $6.7 million for the third quarter and the cash
cost, after by-product credits, was negative $3.12 per silver ounce,
compared to $6.5 million and negative $4.03, respectively, in the third
quarter of 2016.2 The AISC, after by-product credits, was
negative $0.83 per silver ounce for the third quarter compared to
negative $2.39 in the third quarter of 2016, principally due to lower
gold by-product credits and increased exploration and capital spending.3
Work is underway to transition from open pit mining and stockpile feeds
to underground mining, which is expected to occur in early 2018.
Construction of the ramp to connect the new portal to a ramp being
driven from the existing workings continues, and the construction should
be completed by year end. The Company has extended the mill agreement
until the end of 2020.
EXPLORATION AND PRE-DEVELOPMENT
Expenditures
Exploration (including corporate development) expenses were $7.3
million, an increase of $3.4 million compared to the third quarter of
2016. Full year exploration (including corporate development) expenses
are expected to be $20-$25 million, up from $14.7 million in 2016, in
part reflecting more exploration at San Sebastian, Casa Berardi and
Greens Creek and drilling at Kinskuch and Little Baldy.
A complete summary of exploration for the third quarter can be found in
the news release entitled "Hecla Reports Third Quarter Drilling and
Exploration Update" released on November 2, 2017.
PRE-DEVELOPMENT
Pre-development spending was $1.8 million for the quarter, for
permitting of Rock Creek and Montanore.
The US Forest Service issued its Final Supplemental Environmental Impact
Statement and its draft Record of Decision ("ROD") for Rock Creek in
late June. That ROD was subject to a 45 day formal comment period, and
the agency must consider any comments it receives prior to issuing its
final ROD. We anticipate the final ROD in early 2018.
At the Montanore project, the Montana Federal District Court remanded
the ROD to the US Forest Service and US Fish and Wildlife Service for
further review. The Court's decision allows the agencies to issue a ROD
for just the initial evaluation phase of the project, which has minimal
environmental effects.
BASE METALS AND CURRENCY HEDGING
Base Metals Forward Sales Contracts
The following table summarizes the quantities of base metals committed
under financially settled forward sales contracts at September 30, 2017:
|
|
|
| |
|
| |
| | | | Pounds Under Contract | | | |
| | | | (in thousands) | | | Average Price per Pound |
| | | | Zinc |
|
| Lead | | | Zinc |
|
| Lead |
Contracts on forecasted sales
| | | | |
|
| | | | |
|
| |
2017 settlements
| | | |
441
| | |
2,866
| | |
$
|
1.23
| | |
$
|
1.05
|
2018 settlements
| | | |
39,463
| | |
17,968
| | |
$
|
1.27
| | |
$
|
1.05
|
2019 settlements
| | | |
14,330
| | |
8,267
| | |
$
|
1.30
| | |
$
|
1.07
|
2020 settlements
| | | |
3,307
| | |
2,205
| | |
$
|
1.27
| | |
$
|
1.07
|
| | | | | | | | | | | | |
|
The contracts represent 26% of the forecasted payable zinc production
for the next three years at an average price of $1.27 per pound, and 33%
of the forecasted payable lead production for the next three years at an
average price of $1.06 per pound.
Foreign Currency Forward Purchase Contracts
The following table summarizes the quantities of Canadian dollars and
Mexican pesos committed under financially settled forward purchase
contracts at September 30, 2017:
|
|
| |
|
| |
| | | Currency Under Contract | | | |
| | | (in thousands of CAD/MXN) | | | Average Exchange Rate |
| | | CAD |
|
| MXN | | | CAD/USD |
|
| MXN/USD |
2017 settlements
| | |
30,000
|
|
|
43,300
| | |
1.30
|
|
|
19.86
|
2018 settlements
| | |
76,500
| | |
—
| | |
1.29
| | |
—
|
2019 settlements
| | |
63,600
| | |
—
| | |
1.31
| | |
—
|
2020 settlements
| | |
30,000
| | |
—
| | |
1.29
| | |
—
|
| | | | | | | | | | | |
|
2017 ESTIMATES7
The Company is providing updated annual estimates as follows:
2017 Production Outlook
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Silver Production |
|
| Gold Production |
|
| Silver Equivalent |
|
| Gold Equivalent |
|
|
|
| (Moz) |
|
| (Koz) |
|
| (Moz) |
|
| (Koz) |
Greens Creek |
|
|
|
7.8-8.2
|
|
|
51-53
|
|
|
23.0-23.6
|
|
|
325-332
|
Lucky Friday |
|
|
|
0.8-0.9
|
|
|
|
|
|
1.8-2.0
|
|
|
25-28
|
San Sebastian |
|
|
|
3.0-3.4
|
|
|
24-25
|
|
|
4.7-5.2
|
|
|
66-73
|
Casa Berardi |
|
|
|
|
|
|
155-157
|
|
|
11.1-11.2
|
|
|
155-157
|
Total |
|
|
|
11.6-12.5
|
|
|
230-235
|
|
|
40.6-42.0
|
|
|
571-590
|
| | | | | | | | | | | | |
|
2017 Cost Outlook
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Costs of Sales (million) |
|
| Cash cost, after by- product credits, per silver/gold
ounce4,6 |
|
| AISC, after by-product credits, per produced silver/gold
ounce5 |
Greens Creek |
|
|
|
$201
|
|
|
$1.00
|
|
|
$7.00
|
Lucky Friday |
|
|
|
$15
|
|
|
$7.50
|
|
|
$13.00
|
San Sebastian |
|
|
|
$24
|
|
|
$(2.00)
|
|
|
$1.00
|
Total Silver |
|
|
|
$240
|
|
|
$1.00
|
|
|
$9.00
|
Casa Berardi |
|
|
|
$181
|
|
|
$800
|
|
|
$1,150
|
Total Gold |
|
|
|
$181
|
|
|
$800
|
|
|
$1,150
|
|
|
|
| |
|
| |
|
| |
2017 Capital and Exploration Outlook
|
|
|
|
|
2017E Capital expenditures (excluding capitalized interest) |
|
|
|
$105-$110 million
|
2017E Exploration expenditures (includes Corporate Development) |
|
|
|
$22-25 million
|
2017E Pre-development expenditures |
|
|
|
$5 million
|
|
|
|
| |
DIVIDENDS
TheBoard of Directors declared a quarterly cash dividend of
$0.0025 per share of common stock, payable on or about December 1, 2017,
to stockholders of record on November 21, 2017. The realized silver
price was $17.01 in the third quarter and therefore did not satisfy the
criteria for a larger dividend under the Company's dividend policy.
The Board of Directors also declared the regular quarterly dividend of
$0.875 per share on the 157,816 outstanding shares of Series B
Cumulative Convertible Preferred Stock. This represents a total amount
to be paid of approximately $138,000. The cash dividend is payable on or
about January 2, 2018 to shareholders of record on December 15, 2017.
CONFERENCE CALL AND WEBCAST
A conference call and webcast will be held Tuesday, November 7, at 11:00
a.m. Eastern Time to discuss these results. You may join the conference
call by dialing toll-free 1-855-760-8158 or for international dialing
1-720-634-2922. The participant passcode is HECLA. Hecla's live and
archived webcast can be accessed at www.hecla-mining.com
under Investors or via Thomson StreetEvents Network.
ABOUT HECLA
Founded in 1891, Hecla Mining Company (NYSE:HL) is a leading low-cost
U.S. silver producer with operating mines in Alaska, Idaho, and Mexico
and is a gold producer with an operating mine in Quebec, Canada. The
Company also has exploration and pre-development properties in seven
world-class silver and gold mining districts in the U.S., Canada and
Mexico, and an exploration office and investments in early-stage silver
exploration projects in Canada.
NOTES
Non-GAAP Financial Measures
Non-GAAP financial measures are intended to provide additional
information only and do not have any standard meaning prescribed by
generally accepted accounting principles (GAAP). These measures should
not be considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP.
(1) Adjusted net income applicable to common stockholders is
a non-GAAP measurement, a reconciliation of which to net income
applicable to common stockholders, the most comparable GAAP measure, can
be found at the end of the release. Adjusted net income is a measure
used by management to evaluate the Company's operating performance but
should not be considered an alternative to net income, or cash provided
by operating activities as those terms are defined by GAAP, and does not
necessarily indicate whether cash flows will be sufficient to fund cash
needs. In addition, the Company may use it when formulating performance
goals and targets under its incentive program.
(2) Cash cost, after by-product credits, per silver and gold
ounce is a non-GAAP measurement, a reconciliation of which to cost of
sales and other direct production costs and depreciation, depletion and
amortization (sometimes referred to as "cost of sales" in this release),
can be found at the end of the release. It is an important operating
statistic that management utilizes to measure each mine's operating
performance. It also allows the benchmarking of performance of each
mines versus those of our competitors. As a primary silver mining
company, management also uses the statistic on an aggregate basis -
aggregating the Greens Creek, Lucky Friday and San Sebastian mines - to
compare performance with that of other primary silver mining companies.
With regard to Casa Berardi, management uses cash cost, after by-product
credits, per gold ounce to compare its performance with other gold
mines. Similarly, the statistic is useful in identifying acquisition and
investment opportunities as it provides a common tool for measuring the
financial performance of other mines with varying geologic,
metallurgical and operating characteristics. In addition, the Company
may use it when formulating performance goals and targets under its
incentive program.
(3) All in sustaining cost (AISC), after by-product credits,
is a non-GAAP measurement, a reconciliation of which to cost of sales
and other direct production costs and depreciation, depletion and
amortization, the closest GAAP measurement, can be found in the end of
the release. AISC, after by-product credits, includes cost of sales and
other direct production costs, expenses for reclamation and exploration
at the mines sites, corporate exploration related to sustaining
operations, and all site sustaining capital costs. AISC, after
by-product credits, is calculated net of depreciation, depletion, and
amortization and by-product credits.
Current GAAP measures used in the mining industry, such as cost of goods
sold, do not capture all the expenditures incurred to discover, develop
and sustain silver and gold production. Management believes that all in
sustaining costs is a non-GAAP measure that provides additional
information to management, investors and analysts to help (i) in the
understanding of the economics of our operations and performance
compared to other producers and (ii) in the transparency by better
defining the total costs associated with production. Similarly, the
statistic is useful in identifying acquisition and investment
opportunities as it provides a common tool for measuring the financial
performance of other mines with varying geologic, metallurgical and
operating characteristics. In addition, the Company may use it when
formulating performance goals and targets under its incentive program.
(4) Adjusted EBITDA is a non-GAAP measurement, a
reconciliation of which to net income, the most comparable GAAP measure,
can be found at the end of the release. Adjusted EBITDA is a measure
used by management to evaluate the Company's operating performance but
should not be considered an alternative to net income, or cash provided
by operating activities as those terms are defined by GAAP, and does not
necessarily indicate whether cash flows will be sufficient to fund cash
needs. In addition, the Company may use it when formulating performance
goals and targets under its incentive program.
(5) Cash cost, after by-product credits, per gold ounce is
only applicable to Casa Berardi production. Gold produced from Greens
Creek and San Sebastian is treated as a by-product credit against the
silver cash cost.
Other
(6) Expectations for 2017 includes silver, gold, lead and
zinc production from Greens Creek, San Sebastian and Casa Berardi
converted using Au $1,225/oz, Ag $17.25/oz, Zn $1.30/lb, and Pb
$1.05/lb. Lucky Friday expectations are currently suspended as there is
currently a strike. Numbers may be rounded.
Cautionary Statements to Investors on Forward-Looking Statements
This news release contains “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended, which
are intended to be covered by the safe harbor created by such sections
and other applicable laws, including Canadian securities laws. Such
forward-looking statements may include, without limitation: (i)
estimates of future production and sales; (ii) estimates of future costs
including cash cost, after by-product credits per ounce of silver/gold
and AISC, after by-product credits, per ounce of silver/gold; (iii)
estimates for 2017 for silver and gold production, silver equivalent
production, cash cost, after by-product credits, AISC, after by-product
credits, capital expenditures and exploration and pre-development
expenditures (which assumes metal prices of gold at $1,225/oz, Ag
$17.25/oz, Zn $1.30/lb, Pb $1.05; USD/CAD assumed to be $0.78, USD/MXN
assumed to be $0.06) and the impact of the Lucky Friday strike; and (iv)
expectations regarding the development, growth potential, financial
performance and exploration potential of the Company’s projects,
including the EMCP pits in Quebec and San Sebastian operations.
Estimates or expectations of future events or results are based upon
certain assumptions, which may prove to be incorrect. Such assumptions,
include, but are not limited to: (i) there being no significant change
to current geotechnical, metallurgical, hydrological and other physical
conditions; (ii) permitting, development, operations and expansion of
the Company’s projects being consistent with current expectations and
mine plans; (iii) political/regulatory developments in any jurisdiction
in which the Company operates being consistent with its current
expectations; (iv) the exchange rate for the Canadian dollar to the U.S.
dollar, being approximately consistent with current levels; (v) certain
price assumptions for gold, silver, lead and zinc; (vi) prices for key
supplies being approximately consistent with current levels; (vii) the
accuracy of our current mineral reserve and mineral resource estimates;
and (viii) the Company’s plans for development and production will
proceed as expected and will not require revision as a result of risks
or uncertainties, whether known, unknown or unanticipated. Where the
Company expresses or implies an expectation or belief as to future
events or results, such expectation or belief is expressed in good faith
and believed to have a reasonable basis. However, such statements are
subject to risks, uncertainties and other factors, which could cause
actual results to differ materially from future results expressed,
projected or implied by the “forward-looking statements.” Such risks
include, but are not limited to gold, silver and other metals price
volatility, operating risks, currency fluctuations, increased production
costs and variances in ore grade or recovery rates from those assumed in
mining plans, community relations, conflict resolution and outcome of
projects or oppositions, litigation, political, regulatory, labor and
environmental risks, and exploration risks and results, including that
mineral resources are not mineral reserves, they do not have
demonstrated economic viability and there is no certainty that they can
be upgraded to mineral reserves through continued exploration. For a
more detailed discussion of such risks and other factors, see the
Company’s 2016 Form 10-K, filed on February 23, 2017, with the
Securities and Exchange Commission (SEC), as well as the Company’s other
SEC filings. The Company does not undertake any obligation to release
publicly revisions to any “forward-looking statement,” including,
without limitation, outlook, to reflect events or circumstances after
the date of this news release, or to reflect the occurrence of
unanticipated events, except as may be required under applicable
securities laws. Investors should not assume that any lack of update to
a previously issued “forward-looking statement” constitutes a
reaffirmation of that statement. Continued reliance on “forward-looking
statements” is at investors’ own risk.
Cautionary Statements to Investors on Reserves and Resources
Reporting requirements in the United States for disclosure of mineral
properties are governed by the SEC and included in the SEC's Securities
Act Industry Guide 7, entitled “Description of Property by Issuers
Engaged or to be Engaged in Significant Mining Operations” (Guide 7).
However, the Company is also a “reporting issuer” under Canadian
securities laws, which require estimates of mineral resources and
reserves to be prepared in accordance with Canadian National Instrument
43-101 (NI 43-101). NI 43-101 requires all disclosure of estimates of
potential mineral resources and reserves to be disclosed in accordance
with its requirements. Such Canadian information is being included here
to satisfy the Company's “public disclosure” obligations under
Regulation FD of the SEC and to provide U.S. holders with ready access
to information publicly available in Canada.
Reporting requirements in the United States for disclosure of mineral
properties under Guide 7 and the requirements in Canada under NI 43-101
standards are substantially different. This document contains a summary
of certain estimates of the Company, not only of proven and probable
reserves within the meaning of Guide 7, which requires the preparation
of a “final” or “bankable” feasibility study demonstrating the economic
feasibility of mining and processing the mineralization using the
three-year historical average price for any reserve or cash flow
analysis to designate reserves and that the primary environmental
analysis or report be filed with the appropriate governmental authority,
but also of mineral resource and mineral reserve estimates estimated in
accordance with the definitional standards of the Canadian Institute of
Mining, Metallurgy and Petroleum referred to in NI 43-101. The terms
“measured resources”, “indicated resources,” and “inferred resources”
are Canadian mining terms as defined in accordance with NI 43-101. These
terms are not defined under Guide 7 and are not normally permitted to be
used in reports and registration statements filed with the SEC in the
United States, except where required to be disclosed by foreign law. The
term “resource” does not equate to the term “reserve”. Under Guide 7,
the material described herein as “indicated resources” and “measured
resources” would be characterized as “mineralized material” and is
permitted to be disclosed in tonnage and grade only, not ounces. The
category of “inferred resources” is not recognized by Guide 7. Investors
are cautioned not to assume that any part or all of the mineral deposits
in such categories will ever be converted into proven or probable
reserves. “Resources” have a great amount of uncertainty as to their
existence, and great uncertainty as to their economic and legal
feasibility. It cannot be assumed that all or any part of such a
“resource” will ever be upgraded to a higher category or will ever be
economically extracted. Investors are cautioned not to assume that all
or any part of a “resource” exists or is economically or legally
mineable. Investors are also especially cautioned that the mere fact
that such resources may be referred to in ounces of silver and/or gold,
rather than in tons of mineralization and grades of silver and/or gold
estimated per ton, is not an indication that such material will ever
result in mined ore which is processed into commercial silver or gold.
Qualified Person (QP) Pursuant to Canadian
National Instrument 43-101
Dean McDonald, PhD. P.Geo., Senior Vice President - Exploration of Hecla
Mining Company, who serves as a Qualified Person under National
Instrument 43-101, supervised the preparation of the scientific and
technical information concerning Hecla’s mineral projects in this news
release. Information regarding data verification, surveys and
investigations, quality assurance program and quality control measures
and a summary of sample, analytical or testing procedures for the Greens
Creek Mine are contained in a technical report prepared for Hecla titled
“Technical Report for the Greens Creek Mine, Juneau, Alaska, USA”
effective date March 28, 2013, and for the Lucky Friday Mine are
contained in a technical report prepared for Hecla titled “Technical
Report on the Lucky Friday Mine Shoshone County, Idaho, USA” effective
date April 2, 2014, for the Casa Berardi Mine are contained in a
technical report prepared for Hecla titled "Technical Report on the
Mineral Resource and Mineral Reserve Estimate for the Casa Berardi Mine,
Northwestern Quebec, Canada" effective date March 31, 2014 (the "Casa
Berardi Technical Report"), and for the San Sebastian Mine are contained
in a technical report prepared for Hecla titled "Technical Report for
the San Sebastian Ag-Au Property, Durango, Mexico" effective date
September 8, 2015. Also included in these three technical reports is a
description of the key assumptions, parameters and methods used to
estimate mineral reserves and resources and a general discussion of the
extent to which the estimates may be affected by any known
environmental, permitting, legal, title, taxation, socio-political,
marketing or other relevant factors. Copies of these technical reports
are available under Hecla's profile on SEDAR at www.sedar.com.
The current Casa Berardi drill program was performed on core sawed in
half and included the insertion of blanks and standards of variable
grade in every 24 core samples. Standards were generally provided by
Analytical Solutions Ltd and prepared in 30 gram bags. Samples were sent
to the Swastika Laboratories in Swastika, Ontario, a registered
accredited laboratory, where they were dried, crushed, and split for
gold analysis. Analysis for gold was completed by fire assay with AA
finish. Gold over-limits were analyzed by fire assay with gravimetric
finish. Data received from the lab were subject to validation using
in-built program triggers to identify outside limit blank or standard
assays that require re-analysis. Over 5% of the original pulps and
rejects are sent for re-assay to ALS Chemex in Val d’Or for quality
control.
Dr. McDonald reviewed and verified information regarding drill sampling,
data verification of all digitally-collected data, drill surveys and
specific gravity determinations relating to the Casa Berardi mine. The
review encompassed quality assurance programs and quality control
measures including analytical or testing practice, chain-of-custody
procedures, sample storage procedures and included independent sample
collection and analysis. This review found the information and
procedures meet industry standards and are adequate for Mineral Resource
and Mineral Reserve estimation and mine planning purposes.
|
HECLA MINING COMPANY |
Condensed Consolidated Statements of Income
|
(dollars and shares in thousands, except per share amounts -
unaudited)
|
|
|
|
|
|
Third Quarter Ended
|
|
|
Nine Months Ended
|
| | | | September 30, 2017 |
|
|
September 30, 2016
| | | September 30, 2017 |
|
|
September 30, 2016
|
Sales of products
| | | | $ | 140,839 |
| | |
$
|
179,393
|
| | | $ | 417,662 |
| | |
$
|
481,712
|
|
Cost of sales and other direct production costs
| | | | | 68,358 | | | |
90,529
| | | | 224,537 | | | |
249,162
| |
Depreciation, depletion and amortization
| | | |
| 28,844 |
| | |
30,179
|
| | | 83,365 |
| | |
84,592
|
|
| | | |
| 97,202 |
| | |
120,708
|
| | | 307,902 |
| | |
333,754
|
|
Gross profit
| | | |
| 43,637 |
| | |
58,685
|
| | | 109,760 |
| | |
147,958
|
|
| | | | | | | | | | | | |
|
Other operating expenses:
| | | | | | | | | | | | | |
General and administrative
| | | | | 9,529 | | | |
11,155
| | | | 29,044 | | | |
31,728
| |
Exploration
| | | | | 7,255 | | | |
3,859
| | | | 17,622 | | | |
10,171
| |
Pre-development
| | | | | 1,757 | | | |
550
| | | | 4,061 | | | |
1,475
| |
Research and development
| | | | | 1,130 | | | |
—
| | | | 2,125 | | | |
—
| |
Other operating expense
| | | | | 134 | | | |
962
| | | | 1,615 | | | |
2,535
| |
Gain on disposition of properties, plants, equipment and mineral
interests
| | | | | (4,830 | ) | | |
(8
|
)
| | | (4,924 | ) | | |
(319
|
)
|
Provision or closed operations and reclamation
| | | | | 2,940 | | | |
2,162
| | | | 5,044 | | | |
4,779
| |
Lucky Friday suspension-related costs
| | | | | 4,780 | | | |
—
| | | | 14,385 | | | |
—
| |
Acquisition costs
| | | |
| — |
| | |
1,765
|
| | | — |
| | |
2,167
|
|
| | | |
| 22,695 |
| | |
20,445
|
| | | 68,972 |
| | |
52,536
|
|
Income from operations
| | | |
| 20,942 |
| | |
38,240
|
| | | 40,788 |
| | |
95,422
|
|
Other income (expense):
| | | | | | | | | | | | | |
(Loss) gain on derivative contracts
| | | | | (11,226 | ) | | |
7
| | | | (16,548 | ) | | |
—
| |
Loss on disposition of investments
| | | | | — | | | |
—
| | | | (167 | ) | | |
—
| |
Unrealized (loss) gain on investments
| | | | | (124 | ) | | |
49
| | | | (73 | ) | | |
488
| |
Foreign exchange (loss) gain
| | | | | (4,764 | ) | | |
2,375
| | | | (10,909 | ) | | |
(7,713
|
)
|
Interest and other income
| | | | | 541 | | | |
145
| | | | 1,185 | | | |
346
| |
Interest expense, net of amount capitalized
| | | |
| (9,358 | ) | | |
(5,574
|
)
| | | (28,423 | ) | | |
(16,655
|
)
|
| | | |
| (24,931 | ) | | |
(2,998
|
)
| | | (54,935 | ) | | |
(23,534
|
)
|
(Loss) income before income taxes
| | | | | (3,989 | ) | | |
35,242
| | | | (14,147 | ) | | |
71,888
| |
Income tax benefit (provision)
| | | |
| 5,401 |
| | |
(9,453
|
)
| | | 18,377 |
| | |
(22,603
|
)
|
Net income
| | | | | 1,412 | | | |
25,789
| | | | 4,230 | | | |
49,285
| |
Preferred stock dividends
| | | |
| (138 | ) | | |
(138
|
)
| | | (414 | ) | | |
(414
|
)
|
Income applicable to common shareholders
| | | | $ | 1,274 |
| | |
$
|
25,651
|
| | | $ | 3,816 |
| | |
$
|
48,871
|
|
Basic income per common share after preferred dividends
| | | | $ | 0.00 |
| | |
$
|
0.07
|
| | | $ | 0.01 |
| | |
$
|
0.13
|
|
Diluted income per common share after preferred dividends
| | | | $ | 0.00 |
| | |
$
|
0.07
|
| | | $ | 0.01 |
| | |
$
|
0.13
|
|
Weighted average number of common shares outstanding - basic
| | | |
| 398,848 |
| | |
387,578
|
| | | 396,809 |
| | |
383,458
|
|
Weighted average number of common shares outstanding - diluted
| | | |
| 401,258 |
| | |
389,918
|
| | | 400,176 |
| | |
386,318
|
|
| | | | | | | | | | | | | | | | | |
|
|
HECLA MINING COMPANY |
Condensed Consolidated Balance Sheets
|
(dollars and share in thousands - unaudited)
|
|
|
|
|
| September 30, 2017 |
|
|
December 31, 2016
|
ASSETS |
|
|
|
|
|
|
|
Current assets:
|
|
|
| |
|
| |
Cash and cash equivalents
| | | | $ | 172,923 | | | |
$
|
169,777
| |
Short-term investments and securities
| | | | | 32,973 | | | | |
29,117
| |
Accounts receivable:
| | | | | | | |
Trade
| | | | | 6,982 | | | | |
20,082
| |
Other, net
| | | | | 19,413 | | | | |
9,967
| |
Inventories
| | | | | 62,727 | | | | |
50,023
| |
Other current assets
| | | |
| 16,317 |
| | |
|
12,125
|
|
Total current assets
| | | | | 311,335 | | | | |
291,091
| |
Non-current investments
| | | | | 7,098 | | | | |
5,002
| |
Non-current restricted cash and investments
| | | | | 1,076 | | | | |
2,200
| |
Properties, plants, equipment and mineral interests, net
| | | | | 2,025,607 | | | | |
2,032,685
| |
Non-current deferred income taxes
| | | | | 44,683 | | | | |
35,815
| |
Other non-current assets and deferred charges
| | | |
| 6,384 |
| | |
|
4,884
|
|
Total assets | | | | $ | 2,396,183 |
| | |
$
|
2,371,677
|
|
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
Current liabilities:
| | | | | | | |
Accounts payable and accrued liabilities
| | | | $ | 46,847 | | | |
$
|
60,064
| |
Accrued payroll and related benefits
| | | | | 29,085 | | | | |
36,515
| |
Accrued taxes
| | | | | 5,081 | | | | |
9,061
| |
Current portion of capital leases
| | | | | 5,852 | | | | |
5,653
| |
Current portion of debt
| | | | | — | | | | |
470
| |
Current portion of accrued reclamation and closure costs
| | | | | 6,514 | | | | |
5,653
| |
Other current liabilities
| | | |
| 22,418 |
| | |
|
8,809
|
|
Total current liabilities
| | | | | 115,797 | | | | |
126,225
| |
Capital leases
| | | | | 7,436 | | | | |
5,838
| |
Accrued reclamation and closure costs
| | | | | 80,758 | | | | |
79,927
| |
Long-term debt
| | | | | 501,917 | | | | |
500,979
| |
Non-current deferred tax liability
| | | | | 122,723 | | | | |
122,855
| |
Non-current pension liability
| | | | | 43,451 | | | | |
44,491
| |
Other non-current liabilities
| | | |
| 11,160 |
| | |
|
11,518
|
|
Total liabilities | | | |
| 883,242 |
| | |
|
891,833
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
|
Preferred stock
| | | | | 39 | | | | |
39
| |
Common stock
| | | | | 100,886 | | | | |
99,806
| |
Capital surplus
| | | | | 1,617,669 | | | | |
1,597,212
| |
Accumulated deficit
| | | | | (166,602 | ) | | | |
(167,437
|
)
|
Accumulated other comprehensive loss
| | | | | (20,884 | ) | | | |
(34,602
|
)
|
Treasury stock
| | | |
| (18,167 | ) | | |
|
(15,174
|
)
|
Total shareholders’ equity | | | |
| 1,512,941 |
| | |
|
1,479,844
|
|
Total liabilities and shareholders’ equity | | | | $ | 2,396,183 |
| | |
$
|
2,371,677
|
|
Common shares outstanding
| | | |
| 399,019 |
|
|
|
|
395,287
|
|
| | | | | | | | | | |
|
|
HECLA MINING COMPANY |
Condensed Consolidated Statements of Cash Flows
|
(dollars in thousands - unaudited)
|
|
|
|
|
|
Nine Months Ended
|
|
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
OPERATING ACTIVITIES |
|
|
|
|
|
|
|
Net income
| | | | $ | 4,230 | |
|
|
$
|
49,285
| |
Non-cash elements included in net income:
| | | | | | | |
Depreciation, depletion and amortization
| | | | | 87,634 | | | | |
83,900
| |
Loss on disposition of investments
| | | | | 167 | | | | |
—
| |
Gain on disposition of properties, plants, equipment and mineral
interests
| | | | | (4,924 | ) | | | |
(319
|
)
|
Unrealized loss (gain) on investments
| | | | | 73 | | | | |
(488
|
)
|
Provision for reclamation and closure costs
| | | | | 3,379 | | | | |
3,685
| |
Acquisition costs
| | | | | — | | | | |
1,048
| |
Stock compensation
| | | | | 4,943 | | | | |
4,814
| |
Deferred income taxes
| | | | | (24,280 | ) | | | |
10,330
| |
Amortization of loan origination fees
| | | | | 1,415 | | | | |
1,397
| |
Loss on derivative contracts
| | | | | 16,718 | | | | |
337
| |
Foreign exchange loss
| | | | | 11,171 | | | | |
7,555
| |
Other non-cash items, net
| | | | | (1 | ) | | | |
5
| |
Change in assets and liabilities:
| | | | | | | |
Accounts receivable
| | | | | 4,903 | | | | |
5,776
| |
Inventories
| | | | | (9,611 | ) | | | |
(44
|
)
|
Other current and non-current assets
| | | | | (2,685 | ) | | | |
(539
|
)
|
Accounts payable and accrued liabilities
| | | | | (7,759 | ) | | | |
2,042
| |
Accrued payroll and related benefits
| | | | | (913 | ) | | | |
8,621
| |
Accrued taxes
| | | | | (4,469 | ) | | | |
(2,894
|
)
|
Accrued reclamation and closure costs and other non-current
liabilities
| | | |
| (5,876 | ) |
|
|
|
(1,397
|
)
|
Cash provided by operating activities | | | |
| 74,115 |
|
|
|
| 173,114 |
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES |
|
|
|
|
|
|
|
Additions to properties, plants, equipment and mineral interests
| | | | | (70,390 | ) | | | |
(120,236
|
)
|
Acquisition of other companies, net of cash acquired
| | | | | — | | | | |
(3,931
|
)
|
Proceeds from disposition of properties, plants and equipment
| | | | | 151 | | | | |
348
| |
Insurance proceeds received for damaged property
| | | | | 5,628 | | | | |
—
| |
Purchases of investments
| | | | | (36,916 | ) | | | |
(32,847
|
)
|
Maturities of short-term investments
| | | | | 31,169 | | | | |
7,240
| |
Changes in restricted cash and investment balances
| | | |
| 1,124 |
|
|
|
|
(3,900
|
)
|
Net cash used in investing activities | | | |
| (69,234 | ) |
|
|
| (153,326 | ) |
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES |
|
|
|
|
|
|
|
Proceeds from issue of stock, net of related costs
| | | | | 9,610 | | | | |
8,121
| |
Acquisition of treasury shares
| | | | | (2,993 | ) | | | |
(4,363
|
)
|
Dividends paid to common shareholders
| | | | | (2,978 | ) | | | |
(2,882
|
)
|
Dividends paid to preferred shareholders
| | | | | (414 | ) | | | |
(414
|
)
|
Debt origination fees
| | | | | (476 | ) | | | |
(107
|
)
|
Repayments of debt
| | | | | (470 | ) | | | |
(1,807
|
)
|
Payments on capital leases
| | | |
| (5,065 | ) |
|
|
|
(6,328
|
)
|
Net cash used in financing activities | | | |
| (2,786 | ) |
|
|
| (7,780 | ) |
Effect of exchange rates on cash
| | | |
| 1,051 |
|
|
|
| 627 |
|
Net increase in cash and cash equivalents
| | | | | 3,146 | | | | |
12,635
| |
Cash and cash equivalents at beginning of period
| | | |
| 169,777 |
|
|
|
|
155,209
|
|
Cash and cash equivalents at end of period
| | | | $ | 172,923 |
|
|
|
$
|
167,844
|
|
| | | | | | | | | | |
|
|
HECLA MINING COMPANY |
Production Data
|
|
|
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
GREENS CREEK UNIT |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons of ore milled
| | | | | 219,983 | |
|
| |
202,523
|
|
| | 627,900 |
|
| |
610,879
|
Mining cost per ton
| | | | $ | 69.46 | | | |
$
|
69.66
| | | $ | 69.64 | | |
$
|
69.20
|
Milling cost per ton
| | | | $ | 31.01 | | | |
$
|
31.55
| | | $ | 32.38 | | |
$
|
31.07
|
Ore grade milled - Silver (oz./ton)
| | | | | 13.65 | | | | |
15.40
| | | | 12.84 | | | |
14.61
|
Ore grade milled - Gold (oz./ton)
| | | | | 0.089 | | | | |
0.088
| | | | 0.095 | | | |
0.095
|
Ore grade milled - Lead (%)
| | | | | 2.77 | | | | |
2.92
| | | | 2.83 | | | |
3.05
|
Ore grade milled - Zinc (%)
| | | | | 7.47 | | | | |
6.86
| | | | 7.49 | | | |
7.90
|
Silver produced (oz.)
| | | | | 2,344,315 | | | | |
2,445,328
| | | | 6,205,659 | | | |
7,020,688
|
Gold produced (oz.)
| | | | | 12,563 | | | | |
11,988
| | | | 39,289 | | | |
39,497
|
Lead produced (tons)
| | | | | 4,851 | | | | |
4,803
| | | | 14,080 | | | |
15,236
|
Zinc produced (tons)
| | | | | 14,325 | | | | |
12,144
| | | | 40,697 | | | |
42,330
|
Cash cost, after by-product credits, per silver ounce (1) | | | | $ | (0.15 | ) | | |
$
|
4.80
| | | $ | 0.73 | | |
$
|
4.68
|
AISC, after by-product credits, per silver ounce (1) | | | | $ | 4.47 | | | |
$
|
11.02
| | | $ | 5.60 | | |
$
|
10.18
|
Capital additions (in thousands)
|
|
|
| $ | 8,206 |
|
|
|
$
|
14,163
|
|
| $ | 24,891 |
|
|
$
|
35,200
|
LUCKY FRIDAY UNIT |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons of ore milled
| | | | | 7,302 | | | | |
74,397
| | | | 64,371 | | | |
216,247
|
Mining cost per ton
| | | | $ | 150.89 | | | |
$
|
99.13
| | | $ | 112.60 | | |
$
|
99.27
|
Milling cost per ton
| | | | $ | 13.15 | | | |
$
|
25.99
| | | $ | 22.93 | | |
$
|
24.77
|
Ore grade milled - Silver (oz./ton)
| | | | | 12.87 | | | | |
12.40
| | | | 12.45 | | | |
13.05
|
Ore grade milled - Lead (%)
| | | | | 7.68 | | | | |
7.89
| | | | 7.12 | | | |
8.01
|
Ore grade milled - Zinc (%)
| | | | | 3.21 | | | | |
3.85
| | | | 3.9 | | | |
3.94
|
Silver produced (oz.)
| | | | | 88,298 | | | | |
887,364
| | | | 769,080 | | | |
2,721,991
|
Lead produced (tons)
| | | | | 519 | | | | |
5,608
| | | | 4,346 | | | |
16,604
|
Zinc produced (tons)
| | | | | 172 | | | | |
2,681
| | | | 2,303 | | | |
7,991
|
Cash cost, after by-product credits, per silver ounce (1) | | | | $ | 11.60 | | | |
$
|
9.07
| | | $ | 6.58 | | |
$
|
9.34
|
AISC, after by-product credits, per silver ounce (1) | | | | $ | 13.37 | | | |
$
|
20.22
| | | $ | 12.21 | | |
$
|
21.35
|
Capital additions (in thousands)
| | | | $ | 208 | | | |
$
|
9,725
| | | $ | 5,000 | | |
$
|
32,218
|
| | | | | | | | | | | | | | | | | |
|
|
|
|
| |
|
| |
| | | |
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
CASA BERARDI UNIT |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons of ore milled - underground
| | | | | 206,209 | |
|
| |
201,086
| | | | | 606,201 | |
|
| |
636,274
| |
Tons of ore milled - surface pit
| | | | | 119,936 | | | | |
57,014
| | | | | 343,745 | | | | |
57,014
| |
Tons of ore milled - total
| | | | | 326,145 | | | | |
258,100
| | | | | 949,946 | | | | |
693,288
| |
Surface tons mined - ore and waste
| | | | | 2,010,524 | | | | |
1,217,526
| | | | | 6,427,067 | | | | |
1,217,526
| |
Mining cost per ton of ore - underground
| | | | $ | 98.96 | | | |
$
|
86.22
| | | | $ | 98.71 | | | |
$
|
88.85
| |
Mining cost per ton of ore - combined
| | | | $ | 82.95 | | | |
$
|
92.17
| | | | $ | 81.95 | | | |
$
|
90.53
| |
Mining cost per ton of ore and waste - surface tons mined
| | | | $ | 3.42 | | | |
$
|
5.05
| | | | $ | 2.84 | | | |
$
|
5.05
| |
Milling cost per ton
| | | | $ | 16.19 | | | |
$
|
18.07
| | | | $ | 16.28 | | | |
$
|
18.88
| |
Ore grade milled - Gold (oz./ton) - underground
| | | | | 0.193 | | | | |
0.161
| | | | | 0.167 | | | | |
0.181
| |
Ore grade milled - Gold (oz./ton) - surface pit
| | | | | 0.084 | | | | |
0.070
| | | | | 0.086 | | | | |
0.070
| |
Ore grade milled - Gold (oz./ton) - combined
| | | | | 0.153 | | | | |
0.141
| | | | | 0.137 | | | | |
0.172
| |
Ore grade milled - Silver (oz./ton)
| | | | | 0.03 | | | | |
0.04
| | | | | 0.03 | | | | |
0.04
| |
Gold produced (oz.) - underground
| | | | | 35,192 | | | | |
28,437
| | | | | 87,622 | | | | |
100,770
| |
Gold produced (oz.) - surface pit
| | | | | 8,949 | | | | |
3,512
| | | | | 25,587 | | | | |
3,512
| |
Gold produced (oz.) - total
| | | | | 44,141 | | | | |
31,949
| | | | | 113,209 | | | | |
104,282
| |
Cash cost, after by-product credits, per gold ounce (1) | | | | $ | 750 | | | |
$
|
915
| | | | $ | 858 | | | |
$
|
750
| |
AISC, after by-product credits, per gold ounce (1) | | | | $ | 1,091 | | | |
$
|
1,442
| | | | $ | 1,226 | | | |
$
|
1,243
| |
Capital additions (in thousands)
|
|
|
| $ | 13,775 |
|
|
|
$
|
17,603
|
|
|
| $ | 38,249 |
|
|
|
$
|
50,385
|
|
SAN SEBASTIAN |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons of ore milled
| | | | | 36,482 | | | | |
40,192
| | | | | 111,623 | | | | |
108,750
| |
Mining cost per ton
| | | | $ | 35.69 | | | |
$
|
59.49
| | | | $ | 38.70 | | | |
$
|
83.31
| |
Milling cost per ton
| | | | $ | 69.42 | | | |
$
|
66.88
| | | | $ | 66.64 | | | |
$
|
68.52
| |
Ore grade milled - Silver (oz./ton)
| | | | | 25.48 | | | | |
25.77
| | | | | 23.71 | | | | |
33.70
| |
Ore grade milled - Gold (oz./ton)
| | | | | 0.184 | | | | |
0.216
| | | | | 0.183 | | | | |
0.265
| |
Silver produced (oz.)
| | | | | 880,885 | | | | |
975,610
| | | | | 2,498,638 | | | | |
3,434,052
| |
Gold produced (oz.)
| | | | | 6,342 | | | | |
8,189
| | | | | 19,222 | | | | |
27,000
| |
Cash cost, after by-product credits, per silver ounce (1) | | | | $ | (3.12 | ) | | |
$
|
(4.03
|
)
| | | $ | (3.23 | ) | | |
$
|
(3.40
|
)
|
AISC, after by-product credits, per silver ounce (1) | | | | $ | (0.83 | ) | | |
$
|
(2.39
|
)
| | | $ | (0.14 | ) | | |
$
|
(2.25
|
)
|
Capital additions (in thousands)
|
|
|
| $ | 3,350 |
|
|
|
$
|
530
|
|
|
| $ | 7,480 |
|
|
|
$
|
1,223
|
|
| | | | | | | | | | | | |
|
(1) Cash cost, after by-product credits, per ounce and AISC, after
by-product credits. per ounce represent non-U.S. Generally Accepted
Accounting Principles (GAAP) measurements. A reconciliation of cost
of sales and other direct production costs and depreciation,
depletion and amortization (GAAP) to cash cost, after by-product
credits can be found in the cash cost per ounce reconciliation
section of this news release. Gold, lead and zinc produced have been
treated as by-product credits in calculating silver costs per ounce.
The primary metal produced at Casa Berardi is gold, with a
by-product credit for the value of silver production.
|
|
Non-GAAP Measures
(Unaudited)
Reconciliation of Cost of Sales and Other Direct Production Costs
and Depreciation, Depletion and Amortization (GAAP) to Cash Cost, Before
By-product Credits and Cash Cost, After By-product Credits (non-GAAP)
and All-In Sustaining Cost, Before By-product Credits and All-In
Sustaining Cost, After By-product Credits (non-GAAP)
The tables below present reconciliations between the most comparable
GAAP measure of cost of sales and other direct production costs and
depreciation, depletion and amortization to the non-GAAP measures of (i)
Cash Cost, Before By-product Credits, (ii) Cash Cost, After By-product
Credits, (iii) AISC, Before By-product Credits and (iv) AISC, After
By-product Credits for our operations at the Greens Creek, Lucky Friday,
San Sebastian and Casa Berardi units and for the Company for the three-
and nine-month periods ended September 30, 2017 and 2016, and for
estimated amounts for the twelve months ended December 31, 2017.
Cash Cost, After By-product Credits, per Ounce is a measure developed by
precious metals companies (including the Silver Institute) in an effort
to provide a uniform standard for comparison purposes. There can be no
assurance, however, that these non-GAAP measures as we report them are
the same as those reported by other mining companies.
Cash Cost, After By-product Credits, per Ounce is an important operating
statistic that we utilize to measure each mine's operating performance.
We have recently started reporting AISC, After By-product Credits, per
Ounce which we use as a measure of our mines' net cash flow after costs
for exploration, pre-development, reclamation, and sustaining capital.
This is similar to the Cash Cost, After By-product Credits, per Ounce
non-GAAP measure we report, but also includes on-site exploration,
reclamation, and sustaining capital costs. Current GAAP measures used in
the mining industry, such as cost of goods sold, do not capture all the
expenditures incurred to discover, develop and sustain silver and gold
production. Cash Cost, After By-product Credits, per Ounce and AISC,
After By-product Credits, per Ounce also allow us to benchmark the
performance of each of our mines versus those of our competitors. As a
primary silver mining company, we also use these statistics on an
aggregate basis - aggregating the Greens Creek, Lucky Friday and San
Sebastian mines - to compare our performance with that of other primary
silver mining companies. With regard to Casa Berardi, we use Cash Cost,
After By-product Credits, per Gold Ounce and AISC, After By-product
Credits, per Gold Ounce to compare its performance with other gold
mines. Similarly, these statistics are useful in identifying acquisition
and investment opportunities as they provide a common tool for measuring
the financial performance of other mines with varying geologic,
metallurgical and operating characteristics.
Cash Cost, Before By-product Credits and AISC, Before By-product Credits
include all direct and indirect operating cash costs related directly to
the physical activities of producing metals, including mining,
processing and other plant costs, third-party refining expense, on-site
general and administrative costs, royalties and mining production taxes.
AISC, Before By-product Credits for each mine also includes on-site
exploration, reclamation, and sustaining capital costs. AISC, Before
By-product Credits for our consolidated silver properties also includes
corporate costs for general and administrative expense, exploration and
sustaining capital projects. By-product credits include revenues earned
from all metals other than the primary metal produced at each 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.
The Casa Berardi section below reports Cash Cost, After By-product
Credits, per Gold Ounce and AISC, After By-product Credits, per Gold
Ounce for the production of gold, its 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 our Casa Berardi unit is not included as a by-product credit
when calculating CashCost, After By-product Credits, per
Silver Ounce and AISC, After By-product Credits, per Silver Ounce for
the total of Greens Creek, Lucky Friday and San Sebastian, our combined
silver properties. Similarly, the silver produced at our other three
units is not included as a by-product credit when calculating the
similar gold metrics for Casa Berardi.
|
|
|
| |
In thousands (except per ounce amounts) | | | |
Three Months Ended September 30, 2017
|
| | | |
Greens Creek
|
|
|
Lucky Friday(2) |
|
|
San Sebastian
|
|
|
Corporate(3) |
|
|
Total Silver
|
|
|
Casa Berardi (Gold)
|
|
|
Total
|
Cost of sales and other direct production costs and depreciation,
depletion and amortization
| | | |
$
|
41,927
| | | |
—
| | | |
$
|
6,680
| | | | | | |
$
|
48,607
| | | |
$
|
48,595
| | | |
$
|
97,202
| |
Depreciation, depletion and amortization
| | | | |
(12,607
|
)
| | |
—
| | | | |
(641
|
)
| | | | | | |
(13,248
|
)
| | | |
(15,596
|
)
| | | |
(28,844
|
)
|
Treatment costs
| | | | |
12,067
| | | |
440
| | | | |
422
| | | | | | | |
12,929
| | | | |
682
| | | | |
13,611
| |
Change in product inventory
| | | | |
7,675
| | | |
1,960
| | | | |
(627
|
)
| | | | | | |
9,008
| | | | |
(288
|
)
| | | |
8,720
| |
Reclamation and other costs
| | | |
|
(394
|
)
| | |
18
|
| | |
|
(494
|
)
| | | | | |
|
(870
|
)
| | |
|
(124
|
)
| | |
|
(994
|
)
|
Cash Cost, Before By-product Credits (1) | | | | |
48,668
| | | |
2,418
| | | | |
5,340
| | | | | | | |
56,426
| | | | |
33,269
| | | | |
89,695
| |
Reclamation and other costs
| | | | |
666
| | | |
38
| | | | |
117
| | | | | | | |
821
| | | | |
123
| | | | |
944
| |
Exploration
| | | | |
1,944
| | | |
(2
|
)
| | | |
1,495
| | | |
477
| | | |
3,914
| | | | |
1,161
| | | | |
5,075
| |
Sustaining capital
| | | | |
8,210
| | | |
119
| | | | |
402
| | | |
1,105
| | | |
9,836
| | | | |
13,775
| | | | |
23,611
| |
General and administrative
| | | |
| | |
| | |
| | |
9,529
| | |
|
9,529
|
| | |
| | |
|
9,529
|
|
AISC, Before By-product Credits (1) | | | | |
59,488
| | | |
2,573
| | | | |
7,354
| | | | | | | |
80,526
| | | | |
48,328
| | | | |
128,854
| |
By-product credits:
| | | | | | | | | | | | | | | | | | | | | | |
Zinc
| | | | |
(27,046
|
)
| | |
(293
|
)
| | | | | | | | | |
(27,339
|
)
| | | | | | |
(27,339
|
)
|
Gold
| | | | |
(13,907
|
)
| | | | | | |
(8,088
|
)
| | | | | | |
(21,995
|
)
| | | | | | |
(21,995
|
)
|
Lead
| | | | |
(8,067
|
)
| | |
(1,102
|
)
| | | | | | | | | |
(9,169
|
)
| | | | | | |
(9,169
|
)
|
Silver
| | | |
| | |
| | |
| | | | | |
| | |
|
(161
|
)
| | |
|
(161
|
)
|
Total By-product credits
| | | |
|
(49,020
|
)
| | |
(1,395
|
)
| | |
|
(8,088
|
)
| | | | | |
|
(58,503
|
)
| | |
|
(161
|
)
| | |
|
(58,664
|
)
|
Cash Cost, After By-product Credits
| | | |
$
|
(352
|
)
| | |
$
|
1,023
|
| | |
$
|
(2,748
|
)
| | | | | |
$
|
(2,077
|
)
| | |
$
|
33,108
|
| | |
$
|
31,031
|
|
AISC, After By-product Credits
| | | |
$
|
10,468
|
| | |
$
|
1,178
|
| | |
$
|
(734
|
)
| | | | | |
$
|
22,023
|
| | |
$
|
48,167
|
| | |
$
|
70,190
|
|
Divided by ounces produced
| | | | |
2,344
| | | |
88
| | | | |
880
| | | | | | | |
3,312
| | | | |
44
| | | | |
Cash Cost, Before By-product Credits, per Ounce
| | | |
$
|
20.75
| | | |
$
|
27.44
| | | |
$
|
6.07
| | | | | | |
$
|
17.03
| | | |
$
|
753.70
| | | | |
By-product credits per ounce
| | | |
|
(20.90
|
)
| | |
(15.84
|
)
| | |
|
(9.19
|
)
| | | | | |
|
(17.66
|
)
| | |
|
(3.65
|
)
| | | |
Cash Cost, After By-product Credits, per Ounce
| | | |
$
|
(0.15
|
)
| | |
$
|
11.60
|
| | |
$
|
(3.12
|
)
| | | | | |
$
|
(0.63
|
)
| | |
$
|
750.05
|
| | | |
AISC, Before By-product Credits, per Ounce
| | | |
$
|
25.37
| | | |
$
|
29.21
| | | |
$
|
8.36
| | | | | | |
$
|
24.31
| | | |
$
|
1,094.86
| | | | |
By-product credits per ounce
| | | |
|
(20.90
|
)
| | |
(15.84
|
)
| | |
|
(9.19
|
)
| | | | | |
|
(17.66
|
)
| | |
|
(3.65
|
)
| | | |
AISC, After By-product Credits, per Ounce
| | | |
$
|
4.47
|
| | |
$
|
13.37
|
| | |
$
|
(0.83
|
)
| | | | | |
$
|
6.65
|
| | |
$
|
1,091.21
|
| | | |
| | | | | | | | | | | | | | | | | | | | | | |
|
|
|
|
| |
In thousands (except per ounce amounts) | | | |
Three Months Ended September 30, 2016
|
| | | |
Greens Creek
|
|
|
Lucky Friday(2) |
|
|
San Sebastian
|
|
|
Corporate(3) |
|
|
Total Silver
|
|
|
Casa Berardi (Gold)
|
|
|
Total
|
Cost of sales and other direct production costs and depreciation,
depletion and amortization
| | | |
$
|
58,397
| | | |
$
|
19,484
| | | |
$
|
6,532
| | | | | | |
$
|
84,413
| | | |
$
|
36,295
| | | |
$
|
120,708
| |
Depreciation, depletion and amortization
| | | | |
(16,091
|
)
| | | |
(2,946
|
)
| | | |
(677
|
)
| | | | | | |
(19,714
|
)
| | | |
(10,465
|
)
| | | |
(30,179
|
)
|
Treatment costs
| | | | |
15,114
| | | | |
5,211
| | | | |
348
| | | | | | | |
20,673
| | | | |
218
| | | | |
20,891
| |
Change in product inventory
| | | | |
(10,407
|
)
| | | |
(46
|
)
| | | |
930
| | | | | | | |
(9,523
|
)
| | | |
3,460
| | | | |
(6,063
|
)
|
Reclamation and other costs
| | | |
|
2,273
|
| | |
|
(171
|
)
| | |
|
(140
|
)
| | | | | |
|
1,962
|
| | |
|
(115
|
)
| | |
|
1,847
|
|
Cash Cost, Before By-product Credits (1) | | | | |
49,286
| | | | |
21,532
| | | | |
6,993
| | | | | | | |
77,811
| | | | |
29,393
| | | | |
107,204
| |
Reclamation and other costs
| | | | |
682
| | | | |
165
| | | | |
42
| | | | | | | |
889
| | | | |
117
| | | | |
1,006
| |
Exploration
| | | | |
349
| | | | |
—
| | | | |
1,051
| | | |
421
| | | |
1,821
| | | | |
655
| | | | |
2,476
| |
Sustaining capital
| | | | |
14,162
| | | | |
9,725
| | | | |
506
| | | |
76
| | | |
24,469
| | | | |
16,078
| | | | |
40,547
| |
General and administrative
| | | |
| | |
| | |
| | |
11,155
| | |
|
11,155
|
| | |
| | |
|
11,155
|
|
AISC, Before By-product Credits (1) | | | | |
64,479
| | | | |
31,422
| | | | |
8,592
| | | | | | | |
116,145
| | | | |
46,243
| | | | |
162,388
| |
By-product credits:
| | | | | | | | | | | | | | | | | | | | | | |
Zinc
| | | | |
(17,152
|
)
| | | |
(4,201
|
)
| | | | | | | | | |
(21,353
|
)
| | | | | | |
(21,353
|
)
|
Gold
| | | | |
(13,807
|
)
| | | | | | |
(10,922
|
)
| | | | | | |
(24,729
|
)
| | | | | | |
(24,729
|
)
|
Lead
| | | | |
(6,577
|
)
| | | |
(9,284
|
)
| | | | | | | | | |
(15,861
|
)
| | | | | | |
(15,861
|
)
|
Silver
| | | |
| | |
| | |
| | | | | |
| | |
|
(162
|
)
| | |
|
(162
|
)
|
Total By-product credits
| | | |
|
(37,536
|
)
| | |
|
(13,485
|
)
| | |
|
(10,922
|
)
| | | | | |
|
(61,943
|
)
| | |
|
(162
|
)
| | |
|
(62,105
|
)
|
Cash Cost, After By-product Credits
| | | |
$
|
11,750
|
| | |
$
|
8,047
|
| | |
$
|
(3,929
|
)
| | | | | |
$
|
15,868
|
| | |
$
|
29,231
|
| | |
$
|
45,099
|
|
AISC, After By-product Credits
| | | |
$
|
26,943
|
| | |
$
|
17,937
|
| | |
$
|
(2,330
|
)
| | | | | |
$
|
54,202
|
| | |
$
|
46,081
|
| | |
$
|
100,283
|
|
Divided by ounces produced
| | | | |
2,445
| | | | |
887
| | | | |
976
| | | | | | | |
4,308
| | | | |
32
| | | | |
Cash Cost, Before By-product Credits, per Ounce
| | | |
$
|
20.15
| | | |
$
|
24.26
| | | |
$
|
7.16
| | | | | | |
$
|
18.06
| | | |
$
|
920.00
| | | | |
By-product credits per ounce
| | | |
|
(15.35
|
)
| | |
|
(15.19
|
)
| | |
|
(11.19
|
)
| | | | | |
|
(14.38
|
)
| | |
|
(5.07
|
)
| | | |
Cash Cost, After By-product Credits, per Ounce
| | | |
$
|
4.80
|
| | |
$
|
9.07
|
| | |
$
|
(4.03
|
)
| | | | | |
$
|
3.68
|
| | |
$
|
914.93
|
| | | |
AISC, Before By-product Credits, per Ounce
| | | |
$
|
26.37
| | | |
$
|
35.41
| | | |
$
|
8.80
| | | | | | |
$
|
26.96
| | | |
$
|
1,447.40
| | | | |
By-product credits per ounce
| | | |
|
(15.35
|
)
| | |
|
(15.19
|
)
| | |
|
(11.19
|
)
| | | | | |
|
(14.38
|
)
| | |
|
(5.07
|
)
| | | |
AISC, After By-product Credits, per Ounce
| | | |
$
|
11.02
|
| | |
$
|
20.22
|
| | |
$
|
(2.39
|
)
| | | | | |
$
|
12.58
|
| | |
$
|
1,442.33
|
| | | |
| | | | | | | | | | | | | | | | | | | | | |
|
|
|
|
| |
In thousands (except per ounce amounts) | | | |
Nine Months Ended September 30, 2017
|
| | | |
Greens Creek
|
|
|
Lucky Friday(2) |
|
|
San Sebastian
|
|
|
Corporate(3) |
|
|
Total Silver
|
|
|
Casa Berardi (Gold)
|
|
|
Total
|
Cost of sales and other direct production costs and depreciation,
depletion and amortization
| | | |
$
|
140,241
| | | |
$
|
14,542
| | | |
$
|
18,377
| | | | | | |
$
|
173,160
| | | |
$
|
134,742
| | | |
$
|
307,902
| |
Depreciation, depletion and amortization
| | | | |
(39,442
|
)
| | | |
(2,433
|
)
| | | |
(2,036
|
)
| | | | | | |
(43,911
|
)
| | | |
(39,454
|
)
| | | |
(83,365
|
)
|
Treatment costs
| | | | |
37,621
| | | | |
4,257
| | | | |
906
| | | | | | | |
42,784
| | | | |
1,774
| | | | |
44,558
| |
Change in product inventory
| | | | |
5,398
| | | | |
1,811
| | | | |
(192
|
)
| | | | | | |
7,017
| | | | |
881
| | | | |
7,898
| |
Reclamation and other costs
| | | |
|
(1,474
|
)
| | |
|
(163
|
)
| | |
|
(1,089
|
)
| | | | | |
|
(2,726
|
)
| | |
|
(354
|
)
| | |
|
(3,080
|
)
|
Cash Cost, Before By-product Credits (1) | | | | |
142,344
| | | | |
18,014
| | | | |
15,966
| | | | | | | |
176,324
| | | | |
97,589
| | | | |
273,913
| |
Reclamation and other costs
| | | | |
1,999
| | | | |
217
| | | | |
351
| | | | | | | |
2,567
| | | | |
353
| | | | |
2,920
| |
Exploration
| | | | |
3,339
| | | | |
(1
|
)
| | | |
4,984
| | | |
1,307
| | | |
9,629
| | | | |
3,029
| | | | |
12,658
| |
Sustaining capital
| | | | |
24,895
| | | | |
4,109
| | | | |
2,379
| | | |
2,275
| | | |
33,658
| | | | |
38,245
| | | | |
71,903
| |
General and administrative
| | | |
| | |
| | |
| | |
29,044
| | |
|
29,044
|
| | |
| | |
|
29,044
|
|
AISC, Before By-product Credits (1) | | | | |
172,577
| | | | |
22,339
| | | | |
23,680
| | | | | | | |
251,222
| | | | |
139,216
| | | | |
390,438
| |
By-product credits:
| | | | | | | | | | | | | | | | | | | | | | |
Zinc
| | | | |
(72,472
|
)
| | | |
(4,353
|
)
| | | | | | | | | |
(76,825
|
)
| | | | | | |
(76,825
|
)
|
Gold
| | | | |
(42,675
|
)
| | | | | | |
(24,032
|
)
| | | | | | |
(66,707
|
)
| | | | | | |
(66,707
|
)
|
Lead
| | | | |
(22,696
|
)
| | | |
(8,599
|
)
| | | | | | | | | |
(31,295
|
)
| | | | | | |
(31,295
|
)
|
Silver
| | | |
| | |
| | |
| | | | | |
| | |
|
(450
|
)
| | |
|
(450
|
)
|
Total By-product credits
| | | |
|
(137,843
|
)
| | |
|
(12,952
|
)
| | |
|
(24,032
|
)
| | | | | |
|
(174,827
|
)
| | |
|
(450
|
)
| | |
|
(175,277
|
)
|
Cash Cost, After By-product Credits
| | | |
$
|
4,501
|
| | |
$
|
5,062
|
| | |
$
|
(8,066
|
)
| | | | | |
$
|
1,497
|
| | |
$
|
97,139
|
| | |
$
|
98,636
|
|
AISC, After By-product Credits
| | | |
$
|
34,734
|
| | |
$
|
9,387
|
| | |
$
|
(352
|
)
| | | | | |
$
|
76,395
|
| | |
$
|
138,766
|
| | |
$
|
215,161
|
|
Divided by ounces produced
| | | | |
6,206
| | | | |
769
| | | | |
2,498
| | | | | | | |
9,473
| | | | |
113
| | | | |
Cash Cost, Before By-product Credits, per Ounce
| | | |
$
|
22.94
| | | |
$
|
23.42
| | | |
$
|
6.39
| | | | | | |
$
|
18.62
| | | |
$
|
862.02
| | | | |
By-product credits per ounce
| | | |
|
(22.21
|
)
| | |
|
(16.84
|
)
| | |
|
(9.62
|
)
| | | | | |
|
(18.46
|
)
| | |
|
(3.97
|
)
| | | |
Cash Cost, After By-product Credits, per Ounce
| | | |
$
|
0.73
|
| | |
$
|
6.58
|
| | |
$
|
(3.23
|
)
| | | | | |
$
|
0.16
|
| | |
$
|
858.05
|
| | | |
AISC, Before By-product Credits, per Ounce
| | | |
$
|
27.81
| | | |
$
|
29.05
| | | |
$
|
9.48
| | | | | | |
$
|
26.52
| | | |
$
|
1,229.72
| | | | |
By-product credits per ounce
| | | |
|
(22.21
|
)
| | |
|
(16.84
|
)
| | |
|
(9.62
|
)
| | | | | |
|
(18.46
|
)
| | |
|
(3.97
|
)
| | | |
AISC, After By-product Credits, per Ounce
| | | |
$
|
5.60
|
| | |
$
|
12.21
|
| | |
$
|
(0.14
|
)
| | | | | |
$
|
8.06
|
| | |
$
|
1,225.75
|
| | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
|
|
|
| |
In thousands (except per ounce amounts) | | | |
Nine Months Ended September 30, 2016
|
| | | |
Greens Creek
|
|
|
Lucky Friday(2) |
|
|
San Sebastian
|
|
|
Corporate(3) |
|
|
Total Silver
|
|
|
Casa Berardi (Gold)
|
|
|
Total
|
Cost of sales and other direct production costs and depreciation,
depletion and amortization
| | | |
$
|
146,984
| | | |
$
|
56,696
| | | |
$
|
23,435
| | | | | | |
$
|
227,115
| | | |
$
|
106,639
| | | |
$
|
333,754
| |
Depreciation, depletion and amortization
| | | | |
(40,746
|
)
| | | |
(8,775
|
)
| | | |
(2,508
|
)
| | | | | | |
(52,029
|
)
| | | |
(32,563
|
)
| | | |
(84,592
|
)
|
Treatment costs
| | | | |
46,069
| | | | |
15,323
| | | | |
1,193
| | | | | | | |
62,585
| | | | |
627
| | | | |
63,212
| |
Change in product inventory
| | | | |
(6,083
|
)
| | | |
(1,102
|
)
| | | |
1,743
| | | | | | | |
(5,442
|
)
| | | |
4,212
| | | | |
(1,230
|
)
|
Reclamation and other costs
| | | |
|
348
|
| | |
|
(556
|
)
| | |
|
(1,583
|
)
| | | | | |
|
(1,791
|
)
| | |
|
(344
|
)
| | |
|
(2,135
|
)
|
Cash Cost, Before By-product Credits (1) | | | | |
146,572
| | | | |
61,586
| | | | |
22,280
| | | | | | | |
230,438
| | | | |
78,571
| | | | |
309,009
| |
Reclamation and other costs
| | | | |
2,045
| | | | |
495
| | | | |
126
| | | | | | | |
2,666
| | | | |
345
| | | | |
3,011
| |
Exploration
| | | | |
1,368
| | | | |
—
| | | | |
2,349
| | | |
1,286
| | | |
5,003
| | | | |
2,280
| | | | |
7,283
| |
Sustaining capital
| | | | |
35,199
| | | | |
32,203
| | | | |
1,494
| | | |
486
| | | |
69,382
| | | | |
48,860
| | | | |
118,242
| |
General and administrative
| | | |
| | |
| | |
| | |
31,728
| | |
|
31,728
|
| | |
| | |
|
31,728
|
|
AISC, Before By-product Credits (1) | | | | |
185,184
| | | | |
94,284
| | | | |
26,249
| | | | | | | |
339,217
| | | | |
130,056
| | | | |
469,273
| |
By-product credits:
| | | | | | | | | | | | | | | | | | | | | | |
Zinc
| | | | |
(52,104
|
)
| | | |
(10,685
|
)
| | | | | | | | | |
(62,789
|
)
| | | | | | |
(62,789
|
)
|
Gold
| | | | |
(42,017
|
)
| | | | | | |
(33,961
|
)
| | | | | | |
(75,978
|
)
| | | | | | |
(75,978
|
)
|
Lead
| | | | |
(19,598
|
)
| | | |
(25,485
|
)
| | | | | | | | | |
(45,083
|
)
| | | | | | |
(45,083
|
)
|
Silver
| | | |
| | |
| | |
| | | | | |
| | |
|
(409
|
)
| | |
|
(409
|
)
|
Total By-product credits
| | | |
|
(113,719
|
)
| | |
|
(36,170
|
)
| | |
|
(33,961
|
)
| | | | | |
|
(183,850
|
)
| | |
|
(409
|
)
| | |
|
(184,259
|
)
|
Cash Cost, After By-product Credits
| | | |
$
|
32,853
|
| | |
$
|
25,416
|
| | |
$
|
(11,681
|
)
| | | | | |
$
|
46,588
|
| | |
$
|
78,162
|
| | |
$
|
124,750
|
|
AISC, After By-product Credits
| | | |
$
|
71,465
|
| | |
$
|
58,114
|
| | |
$
|
(7,712
|
)
| | | | | |
$
|
155,367
|
| | |
$
|
129,647
|
| | |
$
|
285,014
|
|
Divided by ounces produced
| | | | |
7,021
| | | | |
2,722
| | | | |
3,434
| | | | | | | |
13,177
| | | | |
104
| | | | |
Cash Cost, Before By-product Credits, per Ounce
| | | |
$
|
20.88
| | | |
$
|
22.63
| | | |
$
|
6.49
| | | | | | |
$
|
17.49
| | | |
$
|
753.45
| | | | |
By-product credits per ounce
| | | |
|
(16.20
|
)
| | |
|
(13.29
|
)
| | |
|
(9.89
|
)
| | | | | |
|
(13.95
|
)
| | |
|
(3.92
|
)
| | | |
Cash Cost, After By-product Credits, per Ounce
| | | |
$
|
4.68
|
| | |
$
|
9.34
|
| | |
$
|
(3.40
|
)
| | | | | |
$
|
3.54
|
| | |
$
|
749.53
|
| | | |
AISC, Before By-product Credits, per Ounce
| | | |
$
|
26.38
| | | |
$
|
34.64
| | | |
$
|
7.64
| | | | | | |
$
|
25.74
| | | |
$
|
1,247.15
| | | | |
By-product credits per ounce
| | | |
|
(16.20
|
)
| | |
|
(13.29
|
)
| | |
|
(9.89
|
)
| | | | | |
|
(13.95
|
)
| | |
|
(3.92
|
)
| | | |
AISC, After By-product Credits, per Ounce
| | | |
$
|
10.18
|
| | |
$
|
21.35
|
| | |
$
|
(2.25
|
)
| | | | | |
$
|
11.79
|
| | |
$
|
1,243.23
|
| | | |
| | | | | | | | | | | | | | | | | | | | | |
|
|
|
|
| |
In thousands (except per ounce amounts) | | | |
Estimate for the Twelve Months Ended December 31, 2017
|
| | | |
Greens Creek
|
|
|
Lucky Friday(2) |
|
|
San Sebastian
|
|
|
Corporate(3) |
|
|
Total Silver
|
|
|
Casa Berardi (Gold)
|
|
|
Total
|
Cost of sales and other direct production costs and depreciation,
depletion and amortization
| | | |
$
|
201,000
| | | |
$
|
15,000
| | | |
$
|
24,000
| | | | | | |
$
|
240,000
| | | |
$
|
181,000
| | | |
$
|
421,000
| |
Depreciation, depletion and amortization
| | | | |
(56,000
|
)
| | | |
(3,000
|
)
| | | |
(3,000
|
)
| | | | | | |
(62,000
|
)
| | | |
(55,000
|
)
| | | |
(117,000
|
)
|
Treatment costs
| | | | |
48,000
| | | | |
5,000
| | | | |
1,000
| | | | | | | |
54,000
| | | | |
1,000
| | | | |
55,000
| |
Change in product inventory
| | | | |
(1,000
|
)
| | | |
3,000
| | | | |
2,000
| | | | | | | |
4,000
| | | | |
(1,000
|
)
| | | |
3,000
| |
Reclamation and other costs
| | | |
|
(2,000
|
)
| | |
|
1,000
|
| | |
|
1,000
|
| | | | | |
|
—
|
| | |
|
(1,000
|
)
| | |
|
(1,000
|
)
|
Cash Cost, Before By-product Credits (1) | | | | |
190,000
| | | | |
21,000
| | | | |
25,000
| | | | | | | |
236,000
| | | | |
125,000
| | | | |
361,000
| |
Reclamation and other costs
| | | | |
2,000
| | | | |
—
| | | | |
1,000
| | | | | | | |
3,000
| | | | |
1,000
| | | | |
4,000
| |
Exploration
| | | | |
4,000
| | | | |
—
| | | | |
5,000
| | | |
2,500
| | | |
11,500
| | | | |
4,000
| | | | |
15,500
| |
Sustaining capital
| | | | |
39,000
| | | | |
4,400
| | | | |
3,000
| | | |
2,000
| | | |
48,400
| | | | |
48,000
| | | | |
96,400
| |
General and administrative
| | | |
| | |
| | |
| | |
35,000
| | |
|
35,000
|
| | |
| | |
|
35,000
|
|
AISC, Before By-product Credits (1) | | | | |
235,000
| | | | |
25,400
| | | | |
34,000
| | | | | | | |
333,900
| | | | |
178,000
| | | | |
511,900
| |
By-product credits:
| | | | | | | | | | | | | | | | | | | | | | |
Zinc
| | | | |
(97,000
|
)
| | | |
(5,000
|
)
| | | | | | | | | |
(102,000
|
)
| | | | | | |
(102,000
|
)
|
Gold
| | | | |
(56,000
|
)
| | | | | | |
(31,000
|
)
| | | | | | |
(87,000
|
)
| | | | | | |
(87,000
|
)
|
Lead
| | | | |
(30,000
|
)
| | | |
(10,000
|
)
| | | | | | | | | |
(40,000
|
)
| | | | | | |
(40,000
|
)
|
Silver
| | | |
| | |
| | |
| | | | | |
| | |
|
(1,000
|
)
| | |
|
(1,000
|
)
|
Total By-product credits
| | | |
|
(183,000
|
)
| | |
|
(15,000
|
)
| | |
|
(31,000
|
)
| | | | | |
|
(229,000
|
)
| | |
|
(1,000
|
)
| | |
|
(230,000
|
)
|
Cash Cost, After By-product Credits
| | | |
$
|
7,000
|
| | |
$
|
6,000
|
| | |
$
|
(6,000
|
)
| | | | | |
$
|
7,000
|
| | |
$
|
124,000
|
| | |
$
|
131,000
|
|
AISC, After By-product Credits
| | | |
$
|
52,000
|
| | |
$
|
10,400
|
| | |
$
|
3,000
|
| | | | | |
$
|
104,900
|
| | |
$
|
177,000
|
| | |
$
|
281,900
|
|
Divided by ounces produced
| | | | |
7,800
| | | | |
800
| | | | |
3,000
| | | | | | | |
11,600
| | | | |
155
| | | | |
Cash Cost, Before By-product Credits, per Ounce
| | | |
$
|
24.36
| | | |
$
|
26.25
| | | |
$
|
8.33
| | | | | | |
$
|
20.34
| | | |
$
|
806
| | | | |
By-product credits per ounce
| | | |
|
(23.46
|
)
| | |
|
(18.75
|
)
| | |
|
(10.33
|
)
| | | | | |
|
(19.74
|
)
| | |
|
(6
|
)
| | | |
Cash Cost, After By-product Credits, per Ounce
| | | |
$
|
0.90
|
| | |
$
|
7.50
|
| | |
$
|
(2.00
|
)
| | | | | |
$
|
0.60
|
| | |
$
|
800
|
| | | |
AISC, Before By-product Credits, per Ounce
| | | |
$
|
30.13
| | | |
$
|
31.75
| | | |
$
|
11.33
| | | | | | |
$
|
28.78
| | | |
$
|
1,148
| | | | |
By-product credits per ounce
| | | |
|
(23.46
|
)
| | |
|
(18.75
|
)
| | |
|
(10.33
|
)
| | | | | |
|
(19.74
|
)
| | |
|
(6
|
)
| | | |
AISC, After By-product Credits, per Ounce
| | | |
$
|
6.67
|
| | |
$
|
13.00
|
| | |
$
|
1.00
|
| | | | | |
$
|
9.04
|
| | |
$
|
1,142
|
| | | |
| | | | | | | | | | | | | | | | | | | | | |
|
(1)
|
|
|
Includes all direct and indirect operating costs related to the
physical activities of producing metals, including mining,
processing and other plant costs, third-party refining and marketing
expense, on-site general and administrative costs, royalties and
mining production taxes, before by-product revenues earned from all
metals other than the primary metal produced at each unit. AISC,
Before By-product Credits also includes on-site exploration,
reclamation, and sustaining capital costs.
|
| | |
|
(2)
| | |
The unionized employees at Lucky Friday have been on strike since
March 13, 2017, and production at Lucky Friday has been limited
since that time. For the first nine months of 2017, costs related to
suspension of full production totaling approximately $11.1 million,
along with $3.3 million in non-cash depreciation expense for that
period, have been excluded from the calculations of cost of sales
and other direct production costs and depreciation, depletion and
amortization, Cash Cost, Before By-product Credits, Cash Cost, After
By-product Credits, AISC, Before By-product Credits, and AISC, After
By-product Credits.
|
| | |
|
(3)
| | |
AISC, Before By-product Credits for our consolidated silver
properties includes corporate costs for general and administrative
expense, exploration and sustaining capital.
|
| | |
|
Reconciliation of Net Income Applicable to Common Shareholders (GAAP)
to Adjusted Net Income Applicable to Common Stockholders (non-GAAP)
This release refers to a non-GAAP measure of adjusted net income
applicable to common stockholders and adjusted net income per share,
which are indicators of our performance. They exclude certain impacts
which are of a nature which we believe are not reflective of our
underlying performance. Management believes that adjusted net income per
common share provides investors with the ability to better evaluate our
underlying operating performance.
|
|
|
| |
|
| |
Dollars are in thousands (except per share amounts) | | | |
Three Months Ended September 30,
|
|
|
Nine Months Ended September 30,
|
| | | | 2017 |
|
|
2016
|
|
| 2017 |
|
|
2016
|
Net income applicable to common shareholders (GAAP)
| | | | $ | 1,274 | |
|
|
$
|
25,651
| | | | $ | 3,816 | |
|
$
|
48,871
| |
Adjusting items:
| | | | | | | | | | | | |
Losses (gains) on derivatives contracts
| | | | | 11,226 | | | | |
(7
|
)
| | | | 16,548 | | | |
—
| |
Provisional price (gains) losses
| | | | | (1,244 | ) | | | |
1,141
| | | | | (564 | ) | | |
(376
|
)
|
Environmental accruals
| | | | | — | | | | |
689
| | | | | — | | | |
1,351
| |
Foreign exchange loss (gain)
| | | | | 4,764 | | | | |
(2,375
|
)
| | | | 10,909 | | | |
7,713
| |
Lucky Friday suspension-related costs
| | | | | 4,780 | | | | |
—
| | | | | 14,385 | | | |
—
| |
Acquisition costs
| | | | | — | | | | |
1,765
| | | | | — | | | |
2,167
| |
Bond offering costs
| | | | | — | | | | |
—
| | | | | 887 | | | |
—
| |
Gain on disposal of properties, plants, equipment and mineral
interests
| | | | | (4,830 | ) | | | |
(8
|
)
| | | | (4,924 | ) | | |
(319
|
)
|
Nonrecurring deferred income tax adjustments
| | | | | — | | | | |
—
| | | | | (17,486 | ) | | |
—
| |
Income tax effect of above adjustments
| | | |
| — |
| | |
|
(1,432
|
)
|
| |
| — |
| |
|
(1,129
|
)
|
Adjusted net income applicable to common shareholders
| | | | $ | 15,970 |
| | | $ | 25,424 |
| | | $ | 23,571 |
| | $ | 58,278 |
|
Weighted average shares - basic
| | | | | 398,848 | | | | |
387,578
| | | | | 396,809 | | | |
383,458
| |
Weighted average shares - diluted
| | | | | 401,258 | | | | |
389,918
| | | | | 400,176 | | | |
386,318
| |
Basic adjusted net income per common share
| | | | $ | 0.04 | | | |
$
|
0.07
| | | | $ | 0.06 | | |
$
|
0.15
| |
Diluted adjusted net income per common share
| | | | $ | 0.04 | | | |
$
|
0.07
| | | | $ | 0.06 | | |
$
|
0.15
| |
| | | | | | | | | | | |
|
Reconciliation of Net Income (Loss) (GAAP) and Debt (GAAP) to
Adjusted EBITDA (non-GAAP) and Net Debt (non-GAAP)
This release refers to the non-GAAP measures of adjusted earnings before
interest, taxes, depreciation and amortization ("Adjusted EBITDA"),
which is a measure of our operating performance, and net debt to
adjusted EBITDA for the last 12 months (or "LTM adjusted EBITDA"), which
is a measure of our ability to service our debt. Adjusted EBITDA is
calculated as net income (loss) before the following items: interest
expense, income tax provision, depreciation, depletion, and amortization
expense, exploration expense, pre-development expense, acquisition
costs, foreign exchange gains and losses, gains and losses on derivative
contracts, Lucky Friday suspension-related costs, provisional price
gains and losses, stock-based compensation, unrealized gains on
investments, provisions for closed operations, and interest and other
income (expense). Net debt is calculated as total debt, which consists
of the liability balances for our Senior Notes, capital leases, and
other notes payable, less the total of our cash and cash equivalents and
short-term investments. Management believes that, when presented in
conjunction with comparable GAAP measures, Adjusted EBITDA and net debt
to LTM adjusted EBITDA are useful to investors in evaluating our
operating performance and ability to meet our debt obligations. The
following table reconciles net income (loss) and debt to Adjusted EBITDA
and net debt:
|
|
|
| |
|
| |
|
| |
Dollars are in thousands | | | |
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
Twelve Months Ended
|
| | | | September 30, 2017 |
|
|
September 30, 2016
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
|
| September 30, 2017 |
|
|
September 30, 2016
|
Net income (loss)
| | | | $ | 1,412 | |
|
|
$
|
25,789
| | | | $ | 4,230 | |
|
|
$
|
49,285
| | | | $ | 24,492 | |
|
|
$
|
(13,678
|
)
|
Plus: Interest expense, net of amount capitalized
| | | | | 9,358 | | | | |
5,574
| | | | | 28,423 | | | | |
16,655
| | | | | 33,564 | | | | |
22,694
| |
Plus/(Less): Income taxes
| | | | | (5,401 | ) | | | |
9,453
| | | | | (18,377 | ) | | | |
22,603
| | | | | (13,552 | ) | | | |
83,106
| |
Plus: Depreciation, depletion and amortization
| | | | | 28,844 | | | | |
30,179
| | | | | 83,365 | | | | |
84,592
| | | | | 114,241 | | | | |
115,432
| |
Plus: Exploration expense
| | | | | 7,255 | | | | |
3,859
| | | | | 17,622 | | | | |
10,171
| | | | | 22,171 | | | | |
13,168
| |
Plus: Pre-development expense
| | | | | 1,757 | | | | |
550
| | | | | 4,061 | | | | |
1,475
| | | | | 5,723 | | | | |
1,854
| |
Plus: Acquisition costs
| | | | | — | | | | |
1,765
| | | | | — | | | | |
2,167
| | | | | 528 | | | | |
2,167
| |
Plus: Lucky Friday suspension-related costs
| | | | | 4,780 | | | | |
—
| | | | | 14,385 | | | | |
—
| | | | | 14,385 | | | | |
—
| |
Less: Gain on disposition of properties, plants, equipment and
mineral interests
| | | | | (4,830 | ) | | | |
(8
|
)
| | | | (4,924 | ) | | | |
(319
|
)
| | | | (4,752 | ) | | | |
(90
|
)
|
Plus: Stock-based compensation
| | | | | 2,120 | | | | |
1,347
| | | | | 4,951 | | | | |
4,561
| | | | | 6,322 | | | | |
5,950
| |
Plus: Provision for closed operations and environmental matters
| | | | | 1,132 | | | | |
1,680
| | | | | 3,379 | | | | |
3,685
| | | | | 4,507 | | | | |
4,693
| |
Plus/(Less): Foreign exchange loss (gain)
| | | | | 4,764 | | | | |
(2,375
|
)
| | | | 10,909 | | | | |
7,713
| | | | | 6,122 | | | | |
2,680
| |
Plus/(Less): Losses (gains) on derivative contracts
| | | | | 11,226 | | | | |
(7
|
)
| | | | 16,548 | | | | |
—
| | | | | 12,125 | | | | |
—
| |
(Less)/Plus: Provisional price losses/(gains)
| | | | | (1,244 | ) | | | |
1,141
| | | | | (564 | ) | | | |
(376
|
)
| | | | 730 | | | | |
(449
|
)
|
(Less)/Plus: Other
| | | |
| (417 | ) | | |
|
(194
|
)
| | |
| (945 | ) | | |
|
(834
|
)
| | |
| (441 | ) | | |
|
(1,426
|
)
|
Adjusted EBITDA
| | | | $ | 60,756 |
| | |
$
|
78,753
|
| | | $ | 163,063 |
| | |
$
|
201,378
|
| | | $ | 226,165 |
| | |
$
|
236,101
|
|
Total debt
| | | | | | | | | | | | | | | | $ | 515,205 | | | |
$
|
515,757
| |
Less: Cash, cash equivalents and short-term investments
| | | | | | | | | | | | | | | | $ | (205,896 | ) | | |
$
|
(192,378
|
)
|
Net debt
| | | | | | | | | | | | | | | | $ | 309,309 |
| | |
$
|
323,379
|
|
Net debt/LTM adjusted EBITDA (non-GAAP)
| | | | | | | | | | | | | | | |
| 1.4 |
| | |
|
1.4
|
|
| | | | | | | | | | | | | | | | | | |
|
Reconciliation of Cash Provided by Operating Activities (GAAP) to
Free Cash Flow (non-GAAP)
This release refers to a non-GAAP measure of free cash flow, calculated
as cash provided by operating activities, less additions to properties,
plants, equipment and mineral interests. Management believes that, when
presented in conjunction with comparable GAAP measures, free cash flow
is useful to investors in evaluating our operating performance. The
following table reconciles cash provided by operating activities to free
cash flow:
|
|
|
| |
Dollars are in thousands | | | |
Three Months Ended
|
| | | | September 30, 2017 |
|
|
September 30, 2016
|
Cash provided by operating activities
| | | |
$
|
28,294
| |
| |
$
|
86,976
| |
Less: Additions to properties, plants equipment and mineral interests
| | | | |
(24,426
|
)
| | | |
(43,276
|
)
|
Less: Troy reclamation insurance settlement
| | | |
|
—
|
| | |
|
(16,000
|
)
|
Free cash flow
| | | |
$
|
3,868
|
| | |
$
|
27,700
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20171107005615/en/
Contacts:
Hecla Mining Company
Mike Westerlund, 800-HECLA91 (800-432-5291)
Vice
President - Investor Relations
hmc-info@hecla-mining.com
www.hecla-mining.com
Source: Hecla Mining Company
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