Hecla reports second highest cash flow in 100-plus year history
Hecla Mining CEO Phil Baker said the company remains on track to produce 10 million to 11 million ounces of silver this year.
Posted: Thursday , 29 Jul 2010
RENO, NV -
Hecla Mining Wednesday reported silver production of 5,112,398 ounces for the first six months of this year, down from 5,846,588 ounces for the first half of 2009.
During the first half of this year, Hecla also reported gold production of 34,742 ounces, up from 33,974 ounces during the same period of 2009.
Hecla CEO Phil Baker said, "Our mines, operating management and orebodies combined with current prices allowed Hecla to generate an extraordinary amount of cash flow for the amount of production. With very low operating costs per ounce, our margin was in excess of $20 per ounce of silver which drove cash flow of $54 million in the quarter, the second highest in Hecla's history."
"This cash flow enabled Hecla to deploy financial resources to support larger exploration and development programs to build for the future," he added. Importantly, we increased our cash balance during the recent quarter by more than $80 million to almost $200 million."
Hecla reported net income of $13.7 million or 6-cents per share, applicable to common shareholders, for the second quarter of 2010, compared to a loss of $900 million in the second quarter of 2009.
For the first six months of the year Hecla reported a net income of $32.11 million or 13-cents per share, up from nearly $3 million or 1-cent/sh reported during the first half of 2009.
During a conference call with analysts Wednesday, Baker said, that although second-quarter 2010 production was down to 2.6 million ounces, "our level of production is as planned and we're on track to produce 10 to 11 million ounces.
Baker explained that Hecla's Lucky Friday silver mine in Idaho "had a failure in the exhaust shaft and secondary escape way that required extensive rehabilitation, shutting down the mine for a few weeks. Our team managed to get the rehab down and accelerate the preventative maintenance so it had no impact on our production guidance and only slight impact on cost..."
Hecla also reported 23,763 tons of lead produced during the first half of this year, down from 27,622 tons produced during the first half of 2009. During the first six months of this year Hecla reported zinc production of 43,834 tons, up substantially from 38,121 tons during the same period of 2009.