Hecla Mining Company
Q3 2024 Earnings
Market Reaction
S&P 500 over the same 30 days: +1.55%.
Did HL Beat Earnings? Q3 2024 Results
Hecla Mining delivered a mixed third quarter for 2024, posting revenue of $245.09 million, a 34.7% jump year-over-year that cleared the $229.40 million consensus estimate by 6.84%, yet falling short on the bottom line as adjusted EPS of $0.03 missed the $0.05 consensus by 40.00%. The earnings shortfall traced largely to a cluster of non-operational charges, including a $14.50 million non-cash write-down on its remote vein miner, $13.70 million in ramp-up and suspension costs at Keno Hill, and a $3.20 million foreign exchange loss, which together dragged GAAP net income down sharply to $1.62 million from $27.73 million in the prior quarter. On a brighter note, the company cut total debt by $50.60 million to $539.80 million, bringing net leverage to 1.8x. Looking ahead, Hecla trimmed its 2024 silver production guidance to 16.0 to 17.0 million ounces while affirming gold guidance, with a leadership transition to incoming CEO Rob Krcmarov expected to shape 2025 targets when full-year results are released in February.
- Silver contributed 45% and gold 32% of quarterly revenues
- Greens Creek generated $46.9 million in free cash flow and $54.1 million in cash flow from operations
- Lucky Friday achieved second-highest mill throughput in its 80-year history at 1,133 tpd
- Silver operations generated $170 million in year-to-date free cash flow
- Higher realized gold prices offset lower realized silver, zinc, and lead prices
- Insurance proceeds of $14.8 million collected, completing the $50 million Lucky Friday underground insurance claim
“Hecla produced 3.6 million ounces of silver in the third quarter, bringing year-to-date production to 12.3 million ounces. Lucky Friday had a strong quarter as the mill achieved the second-highest throughput in its 80-year history after a record last quarter. While Greens Creek's silver production was lower than anticipated due to five days of unplanned mill maintenance in the third quarter, our team was able to complete the maintenance quickly and complete a portion of our fourth quarter scheduled maintenance simultaneously. Strong performance from our silver operations has generated free cash flow of $170 million year-to-date, which along with opportunistic use of our ATM program, has allowed us to substantially repay outstanding borrowings on our revolving credit facility, reducing total debt by $50.6 million.”
Hecla Mining CEO, on the earnings call
Forward Guidance & Outlook
Hecla lowered 2024 silver production guidance to 16.0–17.0 million ounces (from 16.5–17.5 million) and increased silver cost guidance, while affirming gold production guidance at 126,000–138,000 ounces and capital/exploration guidance at $196–$218 million. At Keno Hill, 2025 production is expected to remain similar to 2024 as the company prioritizes stakeholder engagement, safety, environmental practices, and infrastructure improvements, with production expected to increase beyond 2024 levels in 2026. Casa Berardi is transitioning to surface-only operations, with underground mining expected to end mid-2025 and a production gap from 2027 to 2032 or later; the company is evaluating strategic alternatives for the mine. No guidance beyond 2024 was provided, with 2025 guidance expected in February 2025 alongside the year-end release. The company anticipates continuing to reduce borrowings on its revolving credit facility at current price levels and expected production.
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Figures from SEC filings and company reports. Not investment advice.