Q2 2026 Hecla Mining Co Earnings Call Transcript
Key Points
- Hecla Mining Co (HL) reported a strong quarter with adjusted EBITDA of $199 million, more than double the $94 million from the same period last year.
- The company achieved record site-level free cash flow at Greens Creek ($130 million) and Lucky Friday ($88 million), contributing to a consolidated free cash flow of $136 million.
- Hecla Mining Co (HL) ended the quarter with its strongest balance sheet in history: $483 million in cash, no long-term debt (excluding capital leases), and a fully undrawn $225 million credit facility.
- The company is advancing high-return, low-capital projects, including the Greens Creek pyrite concentrate circuit (expected to add 1-1.2 million ounces of silver and 10,000-15,000 ounces of gold annually) and the tailings reprocessing project with significant in-situ value.
- Exploration results at Keno Hill and Midas show high-grade extensions and new discoveries, supporting long-term growth potential, with drilling at Aurora and Hollister underway.
- Safety performance improved significantly, with the total recordable injury frequency rate (TRIFR) dropping to 1.57 from 2.07 in the prior quarter.
- The company's cost structure is insulated from fuel price spikes due to high-grade underground mining and reliance on hydropower, with fuel only 3% of consolidated costs.
- Full-year guidance was improved for Greens Creek (silver production raised to 8-8.3 million ounces) and Lucky Friday (cash costs lowered to $9-$9.75 per ounce).
- Revenue declined to $334 million from the record $411 million in Q1 2026, partly due to lower metal prices and timing of concentrate sales at Greens Creek.
- Keno Hill's full-year silver production guidance was lowered to 2.2-2.6 million ounces, reflecting a deliberate slowdown to focus on permitting and site development.
- The company faces permitting delays at Keno Hill, with critical permits not expected until mid-2029, delaying the ramp-up to higher production levels.
- Lucky Friday's high-grade performance in Q2 is not expected to be sustained, with grades likely reverting to the mean in the second half of the year.
- The pyrite concentrate project is still in early stages, with capital and operating cost estimates subject to change as engineering advances.
- The Midas restart is expected to take longer than two to three years, with new permits potentially required for accessing new discoveries.
- The company's effective tax rate could be impacted by the combination of Nevada operations with the main US group, though this is expected to lower cash taxes.
- Exploration and development expenses increased in Q2, which contributed to the gap between site-level and corporate free cash flow.
Hello, everyone. Thank you for joining us and welcome to the Q2 2026 Hecla Mining Company earnings conference call. (Operator Instructions)
I will now hand the conference over to Mike Parkin, Vice President of Strategy and Investor Relations. Mike, please go ahead.
Thanks, Hilary. Good morning, and thank you all for joining us for HECLA's second quarter 2026 results conference call. I'm Mike Parkin, Vice President of Strategy and Investor Relations. Our earnings release that was issued yesterday along with today's presentation are available on our website.
On the call with us today is Rob Krcmarov, President and Chief Executive Officer; Russell Lawler, Senior Vice President and Chief Financial Officer; Carlos Aguilar, Senior Vice President and Chief Operations Officer; Brian Erickson, Vice President of Operations; Kurt Allen, Vice President of Exploration, along with other members of our Management Team. At the conclusion of our prepared remarks, we will be
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