Hecla Mining's Q1 2025: Navigating Contradictions in Turbine Repairs, Strategic Permitting, and M&A Focus

Yukon Energy Corporation turbine repair, permitting and strategic alternatives for Casa Berardi, strategic M&A focus and approach, capital allocation and debt management strategy, and cost and production at Keno Hill are the key contradictions discussed in Hecla Mining's latest 2025Q1 earnings call.



Strong Financial Performance:
- Hecla reported record revenue of $261 million for Q1 2025, with 45% from silver, 33% from gold, and 22% from base metals.
- The company delivered robust adjusted EBITDA and achieved strong free cash flow generation, particularly from Greens Creek and Lucky Friday operations.
- This performance was driven by high metal prices and strong performance from all four operating lines.

Operational Excellence and Cost Management:
- Lucky Friday set a consecutive quarterly milling record, and Keno Hill produced nearly 800,000 ounces of silver, with its first profitable quarter under Hecla's ownership.
- Attempts to reduce reliance on high-cost contractors and optimize extraction methods were implemented to enhance production and control costs.
- The focus on cost control and operational efficiency is part of a broader strategy to improve financial flexibility and balance sheet strength.

Exploration and Strategic Initiatives:
- Hecla is investing over $3.3 million in a targeted exploration program in Nevada, with a focus on high-grade properties like Midas and Hollister.
- The strategy centers on leveraging existing infrastructure and enhancing exploration efforts to expand resources and potentially increase future production.
- These initiatives align with the company's commitment to ESG leadership and financial discipline, prioritizing high-return investments.

Capital Allocation and Financial Discipline:
- The net leverage ratio improved significantly from 2.7x to 1.5x, and the company aims to continue deleveraging.
- Hecla has implemented a rigorous financial discipline framework, prioritizing free cash flow and clear return on investment targets.
- The focus on capital allocation includes strategic investments in Keno Hill and exploration efforts, while maintaining operational efficiency and financial flexibility.