Lucky Friday Mine Ramp Up To Double Production Of Prior Year

COEUR D'ALENE, ID - Phillips S. Baker, Jr., President and CEO of Hecla Mining Company, reported, “We are very pleased with third quarter operational performance particularly as the mines continue safe practices to manage COVID-19. “Lucky Friday’s ramp up is as planned so this year’s production should double last year and is set up to potentially double again next year. The higher-than-expected silver grades at Greens Creek have driven silver production higher for the quarter and the annual estimate. Gold production was lower at Casa during the quarter where continued major planned maintenance activities in the mill reduced the processing days.

Our strong production for the quarter is expected to translate into robust cash flows in excess of $20 million even after repaying our revolver in full and the interest payments on the bonds. We are close to realizing our financial goal of having in excess of $100 million of cash and cash equivalents on the balance sheet. Finally, if our realized silver price is above $25 for September, we expect the silver-linked dividend to be paid pursuant to our enhanced dividend policy.”

Greens Creek’s estimated nine months production has increased due to higher silver grades. The fourth quarter assumes planned grades. Lucky Friday is ramping up as expected so the lower end of the production range has been raised. San Sebastian mining is expected to be completed in the third quarter with processing concluding in the fourth quarter. Casa Berardi’s nine-month estimated production is low because of major planned mill maintenance activities but production in the fourth quarter should increase due to expected high-grade underground production from the East Mine. Nevada exceeded expectations as the developed stopes were mined out. For the remainder of the year, ore is being stockpiled for third-party processing expected in the fourth quarter. Gold production might not be realized until first quarter of 2021. Hecla’s per ounce cost estimates are unchanged at this time.

The Company repaid $50 million on its revolving credit facility and has no remaining balance outstanding. During the third quarter, the Company received three of the four installments of C$12.5 million (US$9.2 million) each of investment Quebec’s C$50 million (US$36.8 million) senior secured note proceeds. The fourth installment is expected to be received in the fourth quarter. The Company’s cash and cash equivalents as of September 30, 2020, are estimated to exceed $90 million with the increase in cash for the third quarter expected to exceed $60 million.