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Section 1: 8-K (FORM 8-K)

hl20181022_8k.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

 


 

FORM 8-K

 

Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): October 23, 2018

 

HECLA MINING COMPANY
(Exact Name of Registrant as Specified in Its Charter)

 

Delaware 1-8491 77-0664171
(State or Other Jurisdiction (Commission File Number) (IRS Employer Identification No.)
of Incorporation)    

 

6500 North Mineral Drive, Suite 200

Coeur d'Alene, Idaho 83815-9408

(Address of Principal Executive Offices) (Zip Code)

 

(208) 769-4100

(Registrant's Telephone Number, Including Area Code)

N/A
(Former name or Former Address, if changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12(b))
     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 



 

 

 

 

Item 2.02 Results of Operations and Financial Condition.

 

On October 23, 2018, Hecla Mining Company (the “Company”) issued a news release (“Release”) announcing preliminary production and financial results for the third quarter ended September 30, 2018.  All measures of the Company's third quarter 2018 operating and financial results and conditions contained in the Release are preliminary and reflect the Company’s expected results as of the date of the Release. Actual reported third quarter 2018 results are subject to management's final review as well as review by the Company's independent registered accounting firm and may vary significantly from current expectations because of a number of factors, including, without limitation, additional or revised information and changes in accounting standards or policies or in how those standards are applied. A copy of the Release is attached as Exhibit 99.1 to this Current Report and is incorporated herein by reference.  

 

In accordance with General Instruction B.2 of Form 8-K, the information in Item 2.02, including Exhibit 99.1, is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any of the Company’s filings or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits

 

Exhibit Number

 

Description

     

99.1

 

News Release, dated October 23, 2018.*

     
   

* Furnished herewith

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Dated:      October 23, 2018

 

 

Hecla Mining Company

 

 

 

 

 

 

 

 

 

 

By:

/s/  David C. Sienko 

 

 

 

David C. Sienko

 

 

 

Vice President & General Counsel

 

 

 

   

 

 

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Section 2: EX-99.1 (EXHIBIT 99.1)

ex_125963.htm

 

Exhibit 99.1

NEWS RELEASE

 

 

HECLA REPORTS 2.5 MILLION OUNCES OF SILVER AND

72,995 OUNCES OF GOLD PRODUCTION IN THIRD QUARTER 2018

$200 million revolving line of credit is undrawn at quarter end

 

FOR IMMEDIATE RELEASE

October 23, 2018

 

COEUR D'ALENE, IDAHO -- Hecla Mining Company (NYSE:HL) today announced certain preliminary results¹ for the third quarter of 2018.

 

HIGHLIGHTS 

 

 

Silver production of 2.5 million ounces, and gold production of 72,995 ounces.

     
 

Silver equivalent production of 10.9 million ounces or gold equivalent production of 135,096 ounces.2

     
 

Lead production of 4,239 tons; zinc production of 12,795 tons.

     
 

Cash, cash equivalents and short-term investments of approximately $61 million at September 30, 2018 and the revolving line of credit was undrawn. The cash balance includes proceeds from closing out the base metals hedgebook for $32.8 million and receiving $9.5 million of cash from the release of collateral posted by Klondex for reclamation bonds.

 

“Our gold and silver production met our expectations, with gold production increasing due to the addition of two months of production from the Nevada operations and silver production declining due to lower expected grades at Greens Creek,” said Phillips S. Baker, Jr., President and CEO. “We are on track to meet annual production estimates at all operations. At our new Nevada assets, we are focusing on completing enough underground development at Fire Creek so by about mid-2019 we should have consistent production with an expected 50% higher throughput. We have begun the access drift to the Hatter Graben, which could provide the next leg of growth in Nevada. With Hecla’s strong operations and balance sheet management, we don’t anticipate any significant utilization of the line of credit, which is currently undrawn.”

 

(1)

See cautionary statement regarding preliminary statements at the end of this release.

(2)

Silver and gold equivalent calculation based on average actual prices for each metal in the third quarter as follows: $14.99 for Ag, $1,213 for Au, $0.95 for Pb, and $1.15 for Zn.

 

 

                                      Hecla Mining Company ● 1-800-432-5291 ● hmc-info@hecla-mining.com                                    1

 

 

Greens Creek

 

At the Greens Creek mine, 1.9 million ounces of silver and 11,559 ounces of gold were produced in the quarter. The lower silver and gold production, when compared to the third quarter of 2017, was due to lower ore grades and milled tonnage as a result of mine sequencing. The mill operated at an average of 2,316 tons per day (tpd).

 

Casa Berardi

 

At the Casa Berardi mine, 43,981 ounces of gold were produced in the quarter, including 2,767 ounces from the East Mine Crown Pillar pit. The mine produced as expected, with gold production similar to the third quarter of 2017. The mill operated at an average of 3,846 tpd.

 

San Sebastian

 

At the San Sebastian mine, 0.5 million ounces of silver and 3,666 ounces of gold were produced in the third quarter. Although silver and gold production were lower compared to the third quarter of 2017, both still met our expectations for the quarter. The mill operated at an average of 432 tpd.

 

Nevada Operations

 

At our newly-acquired Nevada operations, 13,789 ounces of gold and 84,145 ounces of silver were produced since the acquisition on July 20. During that period, ore was processed at the Nevada operations at an average of 776 tpd.

 

Lucky Friday

 

At the Lucky Friday mine, 31,639 ounces of silver were produced in the quarter compared to 88,298 ounces in the third quarter of 2017, as limited production performed by salaried staff continued during the ongoing strike.

 

 

                                      Hecla Mining Company ● 1-800-432-5291 ● hmc-info@hecla-mining.com                                    2


 

 

PRODUCTION SUMMARY

 

 

Third Quarter Ended

 

Nine Months Ended

 
 

September 30,

2018

September 30,

2017

 

September 30,

2018

September 30,

2017

 

PRODUCTION

   

Increase/

(Decrease)

   

Increase/

(Decrease)

             

Silver (oz)

2,523,690

3,323,157

(24%)

7,654,208

9,500,058

(19%)

             

Gold (oz)

72,995

63,046

16%

191,115

171,720

11%

             

Lead (tons)

4,239

5,370

(21%)

15,388

18,426

(16%)

             

Zinc (tons)

12,795

14,497

(12%)

42,305

43,000

(2%)

             

Greens Creek  Silver (oz)

1,876,416

2,344,315

(20%)

5,789,440

6,205,659

(7%)

             

Greens Creek  Gold (oz)

11,559

12,563

(8%)

38,396

39,290

(2%)

             

Lucky Friday  Silver (oz)

31,639

88,298

(64%)

156,105

769,080

(80%)

             

San Sebastian  Silver (oz)

521,931

880,885

(41%)

1,593,770

2,498,638

(36%)

             

San Sebastian  Gold (oz)

3,666

6,342

(42%)

12,051

19,222

(37%)

             

Casa Berardi Gold (oz)

43,981

44,141

0%

126,879

113,209

12%

             

Nevada Operations Silver (oz)

84,145

N/A

N/A

84,145

N/A

N/A

             

Nevada Operations Gold (oz) 

13,789

N/A

N/A

13,789

N/A

N/A

 

 

 

Hecla expects to report third quarter 2018 financial results on November 8, 2018.

 

 

ABOUT HECLA

 

Founded in 1891, Hecla Mining Company (NYSE:HL) is a leading low-cost U.S. silver producer with operating mines in Alaska, Idaho and Mexico, and is a growing gold producer with operating mines in Quebec, Canada and Nevada. The Company also has exploration and pre-development properties in eight world-class silver and gold mining districts in the U.S., Canada, and Mexico.

 

Cautionary Statements Regarding Preliminary Results

All measures of the Company's third quarter 2018 operating and financial results contained in this news release, including cash, cash equivalents and short-term investments, are preliminary and reflect the Company’s expected results as of the date of this news release. Actual reported third quarter 2018 results are subject to management's final review as well as review by the Company's independent registered public accounting firm and may vary significantly from those expectations because of a number of factors, including, without limitation, additional or revised information and changes in accounting standards or policies or in how those standards are applied.

 

 

                                      Hecla Mining Company ● 1-800-432-5291 ● hmc-info@hecla-mining.com                                    3

 

 

Cautionary Statements Regarding Forward Looking Statements

Statements made or information provided in this news release that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of Canadian securities laws. Words such as “may”, “will”, “should”, “expects”, “intends”, “projects”, “believes”, “estimates”, “targets”, “anticipates” and similar expressions are used to identify these forward-looking statements. Such forward-looking statements or forward-looking information include statements or information regarding estimates of silver production for the third quarter of 2018 on a consolidated basis and at each of the Greens Creek, Lucky Friday and San Sebastian mines, third quarter 2018 gold production at Casa Berardi and Nevada operations, and quarter-end cash position. The material factors or assumptions used to develop such forward-looking statements or forward-looking information include that the Company’s plans for development and production will proceed as expected and will not require revision as a result of risks or uncertainties, whether known, unknown or unanticipated, to which the Company’s operations are subject.

 

Forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those projected, anticipated, expected or implied. These risks and uncertainties include, but are not limited to, metals price volatility, volatility of metals production and costs, litigation, regulatory and environmental risks, operating risks, project development risks, political risks, labor issues, ability to raise financing and exploration risks and results. Refer to the Company's Form 10K and 10-Q reports for a more detailed discussion of factors that may impact expected future results. The Company undertakes no obligation and has no intention of updating forward-looking statements other than as may be required by law.

 

For further information, please contact:

 

Mike Westerlund

Vice President – Investor Relations

800-HECLA91 (800-432-5291)

Investor Relations

Email: hmc-info@hecla-mining.com

Website: www.hecla-mining.com

 

 

                                      Hecla Mining Company ● 1-800-432-5291 ● hmc-info@hecla-mining.com                                    4

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