Hecla Mining Posts 1Q Loss, Suspends Guidance For Nevada Ops
(Kitco News) - Hecla Mining Co. (NYSE: HL) Thursday reported a loss for the first quarter due to a disappointing performance at its Nevada mines and said it was suspending guidance for operations in the state while the company conducts a review.
Hecla listed a quarterly adjusted net loss of $18.5 million, or 4 cents per share.
The net loss was $25.7 million, or a nickel per share, a turnaround from a profit of $8.1 million, or 2 cents, in the same quarter of 2018. The company said the result was mainly due to losses from operations in Nevada of $13.8 million, which officials blamed on higher costs, as well as lower grades and recoveries than anticipated. Also, the profit was lower by $15.4 million at Casa Berardi as a result of 11,000 less gold ounces sold.
“Greens Creek exceeded expectations for both gold and silver production due to higher grades and recoveries,” said Phillips S. Baker, Jr., president and chief executive officer. “However, Casa Berardi and our Nevada operations both produced less cash flow than expected.
“Casa Berardi’s gold production was lower in part due to lower grades, which were expected, and also due to the lower mill throughput resulting from some temporary issues in the mill that have now been addressed, and we expect results to improve over the rest of the year.”
Operating metrics at the Nevada operations were “unacceptable,” Baker said.
“We are reviewing our Nevada operations to determine the best path forward and expect the results of this review in the second quarter,” he continued. “In the meantime, we are suspending our annual Nevada estimates for production and cost. We are maintaining our annual estimates for capital and exploration spending to maintain our liquidity and balance sheet.”
The company currently lists no gold-production guidance for 2019. Silver-output guidance is 9.9 million ounces.
First-quarter silver production totaled 2.9 million ounces, up from 2.5 million in the same quarter a year earlier. A strike continues at the Lucky Friday mine in Idaho, although the limited output by salaried staff did rise from the year-ago period. Consolidated gold output edged up to 60,021 ounces from 57,808. The company also mines lead and zinc as a by-product.
The average realized silver price in the first quarter fell 7% to $15.70 per ounce from $16.84 in the same quarter a year earlier. Realized gold, lead and zinc prices decreased 2%, 22%, and 13%, respectively.
The board of directors declared a quarterly cash dividend of $0.0025 per share payable around June 9 to stockholders of record as of May 24.