Though sales were down in the third quarter of 2011 from last year, low per ounce production costs and high metal prices helped Hecla Mining Company realize an “excellent” quarter, according Phillips Baker, Hecla’s president and CEO.
“This was a unique quarter in Hecla’s long history,” Baker said. “Sales were $121 million and net income was a quarterly record. And realized sliver prices averaged $37 per ounce, so almost all of that was margin. Cash from operating activities was $61 million, increasing our cash position to a record $414 million.”
This year Hecla also announced an innovative dividend policy.
“We believe it gives Hecla the highest payout among sliver companies,” Baker said.
Greens Creek had net sales of $77 million in the third quarter of 2011 and $260.65 million year-to-date. The mine’s nine-month net sales increased by nearly $50 million from 2010.
Hecca describes Greens Creek as primarily a silver mine. It also sells gold, zinc and lead as by-products of its silver production.
“Metal prices continue to remain strong across the four metals that we produced this quarter, resulting an excellent financial performance,” said James A. Sabala, Hecla’s chief financial officer. Realized silver price is up by 73 percent and realized gold price is up by 40 percent over the third quarter of 2010, he said. Zinc and lead prices in the third quarter were also up.
Hecla has cash on hand to continue to invest in infrastructure and growth of its mines. The company’s total liquidity available for investment at quarter end stood at $514 million, “which we expect will be sufficient to continue the capital projects, pre-development initiatives and exploration activities that we have on our plate,” Sabala said.
Hecla saw a decrease in payable quantities sold for the third quarter of 2011 compared to the same period in 2010. The company said the decrease is due to the timing of concentrate shipments, reduced availability of high volume shafts into the ore body and lower ore grades.
Hecla Mining Company and its subsidiaries have provided precious and base metals to the U.S. economy and worldwide since 1891. Hecla’s main mining operations are the Greens Creek and Lucky Friday mines. Lucky Friday is located in Mullan, Idaho.
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