Mining News
Hecla reports lower quarterly income as it feels inflationary pressures; says on track to grow silver output
(Kitco News) - Hecla Mining (NYSE: HL) today announced silver production of 3.3 million ounces in Q1 2022, down 6% compared to Q1 2021 (3.5 Moz) and up 3% over Q4 2021.
The company's gold production was 41,642 ounces in Q1 2022, a decrease of 20% over Q1 2021. Hecla also produced 10,863 tonnes of lead (Q1 2021: 10,703 tonnes) and 14,947 tonnes of zinc (Q1 2021: 16,107 tonnes).
Hecla said that the company is on track to grow silver production this year and for each of the next two years while also being the United States' third largest zinc producer.
The company added that its gross profit in Q1 2022 decreased by $7.8 million to $45.4 million over Q4 2021 due primarily to higher mining costs at Casa Berardi resulting from inflationary pressures and increased used of contractors.
Cash provided by operating activities of $37.9 million decreased $15.4 million compared to the prior quarter, primarily due to negative working capital changes of $17.8 million mostly due to interest payments on the outstanding long-term debt.
The company said that income applicable to common shareholders for the first quarter was $4.0 million, or $0.01 per share, compared to $11.7 million, or $0.02 per share, in the fourth quarter of 2021.
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"All of our mines generated positive free cash flow despite inflationary cost pressures, slow supply chains, and some COVID-19 related labor challenges," commented Phillips S. Baker Jr., President and CEO.
"With strong grades and our innovative mining method at the Lucky Friday, we expect the mine’s quarterly silver production for the rest of the year to exceed one million ounces contributing to our increasing silver production profile. Growing U.S. silver production is particularly rewarding as demand for silver to generate green energy is growing and the need for domestically sourced metals is being understood because of the pandemic and the Ukrainian war," he added.
Founded in 1891, Hecla Mining is the largest silver producer in the United States. In addition to operating mines in Alaska, Idaho and Quebec, Canada, the company owns a number of exploration and pre-development projects in North America.
