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Did Hecla Mining beat or miss consensus estimates last quarter?

What were the key takeaways from Hecla Mining's earnings call?

- **Record financials and debt reduction**: Q3 revenue of $410 million, net income of $101 million, and 83% reduction in net leverage to 0.3x.
- **All mines profitable**: Greens Creek, Lucky Friday, Keno Hill, and Casa Berardi all generated positive free cash flow.
- **Silver dominance**: 48% of revenue from silver, with margins of $31.57/oz (74% of realized price).
- **Nevada exploration expansion**: 2026 budget to increase exploration spending to 2-5% of revenue, targeting high-return projects.
- **Keno Hill timeline**: Commercial production in 2027 (345-385 tpd) and full capacity in 2028, contingent on regulatory approvals.
- **Free cash flow generation**: $90 million for the quarter, with Greens Creek contributing $75 million and Keno Hill $8.3 million.


**【CEO Summary Section】**
- **Record financial performance**: Q3 revenue of $410 million, net income of $101 million, and adjusted EBITDA of $196 million, all at record highs.
- **Debt reduction milestone**: Net leverage reduced from 1.8x to 0.3x year-over-year, with $212 million debt redeemed and revolver fully repaid.
- **Operational excellence**: All four mines (Greens Creek, Lucky Friday, Keno Hill, Casa Berardi) generated positive free cash flow for the second consecutive quarter.
- **Silver production growth**: 4.6 million ounces at all-in sustaining costs of $11.01/oz, driven by negative cash costs from by-product credits.
- **Project momentum**: Surface cooling at Lucky Friday on track for 2026 completion, and Greens Creek tailings permit secured.

**【CFO Financial Commentary】**
- **Revenue mix**: Silver (48%), gold (37%), and base metals (15%) reflect strong silver price exposure.
- **Margin strength**: Silver margins of $31.57/oz (74% of realized price) and gold margins of $1,582/oz.
- **Free cash flow**: $90 million for the quarter, with Greens Creek contributing $75 million and Keno Hill $8.3 million.
- **Capital allocation framework**: Priorities include safety, sustaining capital (10-15% returns), growth (10-12% returns), exploration (2-5% of revenue), balance sheet strength, and shareholder returns.

**【COO Operational Update】**
- **Greens Creek**: 2.3 million oz silver, $75 million free cash flow, and 15,600 oz gold produced.
- **Lucky Friday**: 1.3 million oz silver, 7% grade improvement, and $13.5 million free cash flow.
- **Keno Hill**: 900,000 oz silver at 323 tpd, $8.3 million free cash flow, and underground development 13% ahead of plan.
- **Casa Berardi**: 25,000 oz gold, $1,746/oz AISC, and evaluation of post-2027 production extensions.

**【Exploration Update】**
- **Nevada focus**: Midas, Hollister, and Aurora properties with historical production and minimal regulatory hurdles.
- **2026 strategy**: Increased exploration spending (2-5% of revenue) and generative programs targeting high-return opportunities.
- **Keno Hill timeline**: Commercial production expected in 2027 (345-385 tpd) and nameplate capacity in 2028, contingent on water discharge approval.

**【Q&A Highlights】**
- **Inflationary pressures**: Labor costs (contractor reliance, wage competition) and tariffs on imported components.
- **Exploration costs**: $8.8 million spent in Q3, with assay turnaround times stable despite seasonal lab constraints.
- **Guidance adjustments**: Q4 production expectations reflect historical profiles (e.g., Greens Creek ~2 million oz silver) and shipment timing.
- **Price realization**: Late-quarter silver price increases and collar hedging strategies drove weighted average prices above spot.


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