Slide 1: PDAC 2015
QUALITY ASSETS UPSIDE POTENTIAL FINANCIAL STRENGTH UNDERVALUED PDAC 2015 March 2, 2015
Slide 2: Cautionary Statements
HECLA MINING COMPANY Cautionary Statements Cautionary Statement Regarding Forward Looking Statements, Including 2015 Outlook This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Slide 3: Hecla’s Outperformance YTD
HECLA MINING COMPANY Hecla’s Outperformance YTD 2015 Relative Price Performance 25% 20% 21% 15% 10% 5% 4% 3% 0% Price Performance -5% Hecla: 21% Intermediate Silver Index: 4% -10% -9% Junior Silver Index: 9% Silver Spot: 3% -15% 2-Jan-15 17-Jan-15 1-Feb-15 16-Feb-15 Hecla Intermediate Silver Index J
Slide 4: 2014 Highlights and Achievements
HECLA MINING COMPANY 2014 Highlights and Achievements $501M revenue 31%1 Record 34.5M silver equivalent production 50%2 Record 11.1M ounces silver production 24% Record 187K ounces gold production 56% P & P silver reserves 173M ounces 1.9% Record Adjusted EBITDA $174M 29%3 Cash at year end $210M vs.
Slide 5: Hecla: A Transformed Company Since 2012
HECLA MINING COMPANY Hecla: A Transformed Company Since 2012 2012 2014 % Change Silver production 6.4Moz 11.1Moz +73% Silver equivalent production 14.3Moz 34.5Moz +142% Gold production 56Koz 187Koz +237% Revenue $321M $501M +56% Operating cash flow $69M $138M1 +101% 1. Pro-forma 2014 OCF includes th
Slide 6: What Differentiates Hecla From Its Peers
HECLA MINING COMPANY What Differentiates Hecla From Its Peers Quality assets and strong reserves – no impairments or write-downs of our properties Our mines are strong cash flow generators All our mines and pre-development projects have further upside Financially strong Undervalued 6
Slide 7: HL Using Lower 2014 Reserve/Resource Prices
HECLA MINING COMPANY HL Using Lower 2014 Reserve/Resource Prices1 2014 Reserve Silver Price/oz 2014 Reserve Gold Price/oz $22.00 $18.50 $19.00 $1,300 $17.25 $18.00 $1,260 $1,275 $1,250 $1,225 Hecla Endeavour Pan Coeur Goldcorp Hecla Pan American Endeavour Coeur Goldcorp American 2014 Resource Silver
Slide 8: North American Focused Asset Portfolio
HECLA MINING COMPANY North American Focused Asset Portfolio Operations In Low-Risk + Mining-Friendly Jurisdictions 8
Slide 9: Our Mines Are Strong Cash Flow Generators
HECLA MINING COMPANY Our Mines Are Strong Cash Flow Generators 2014 (USD Millions) Greens Creek Casa Berardi Lucky Friday 72% Conversion 15% Conversion 48% Conversion to FCF1 to FCF1 to FCF 2 $104.0 $60.9 $29.3 $69.1 $33.8 $50.4 $17.5 $16.3 $10.6 $34.5 OCF* Capex FCF** OCF* Capex FCF** ($18.2) OCF*
Slide 10: Casa Berardi: Great New Addition
HECLA MINING COMPANY Casa Berardi: Great New Addition Cash cost, after by-product Gold Production credits, per gold oz1 2014 Actual 128,244 oz $826/oz 2015E 130,000 oz $825/oz 2015E Capital $44M Ownership June 2013 2P Reserves 1.3 Moz gold @ 0.14 oz/t M+I Resources 1.4 Moz gold @ 0.12 oz/t 101. Cash
Slide 11: Casa Berardi: Exploration Upside
HECLA MINING COMPANY Casa Berardi: Exploration Upside Composite Longitudinal Section 11
Slide 12: Casa Berardi: Increasing Resources
HECLA MINING COMPANY Casa Berardi: Increasing Resources Southwest Zone 124 Zone 113 Zone New Zone 117 118 Zone 985 Level 4.0 gpt Au/4.6 m 123 Zone 15.8 gpt Au/4.5 m 12
Slide 13: Greens Creek: Expanding Reserves and Resources
HECLA MINING COMPANY Greens Creek: Expanding Reserves and Resources Definition Drilling Exploration Drilling Deep Deep 200 200 South South Deep 200 Exploration Exploration South Definition 13
Slide 14: #4 Shaft: Expected to Grow Production 60%
HECLA MINING COMPANY #4 Shaft: Expected to Grow Production 60% As of Q4/14: 75% completed $165 million spent Excavation completed Q3/15 Operational shaft expected in Q3/16 at a 7580 Level total cost of $215 million Current Excavation On schedule and on budget 14
Slide 15: San Sebastian: Significant New Discoveries
HECLA MINING COMPANY San Sebastian: Significant New Discoveries SAN SEBASTIAN CONCESSIONS Aerial View Looking West Focus Area 0 500 LEGEND 1 : 500 Approximate Scale New Veins Past Producing Veins 15
Slide 16: Improving On Already Strong Margins
HECLA MINING COMPANY Improving On Already Strong Margins Silver Margins Casa Berardi Margins $1,298 $1,291 $1,275 $1,262 $35.30 $1,195 $32.11 32% $339 26% $412 $377 30% $436 35% 47% $560 $21.28 97% $18.46 $34.15 92% $29.41 68% $952 $14.44 74% $826 $13.65 $886 $898 $635 $6.84 $2.70 $4.81 $1.15 2011 2
Slide 17: 2015 Expectations
HECLA MINING COMPANY 2015 Expectations 2015E1 Silver 2015E1 Gold Cash cost, after by-product Mine Production (Moz) Production (oz) credits, per silver/gold ounce2 Greens Creek 7.3 55,000 $4.50 Lucky Friday 3.2 n/a $8.75 Casa Berardi n/a 130,000 $825 Total 10.5 185,000 $6.00 Equivalent Production: In
Slide 18: Thank You
HECLA MINING COMPANY Thank You 18
Slide 19: Appendix Table of Contents
HECLA MINING COMPANY Appendix Table of Contents Appendices Page 1. Greens Creek 20 2. Lucky Friday 25 3. Casa Berardi 29 4. Exploration/Pre-Development 31 5. Silver and Gold Overview 39 6. Zinc Overview 43 7. Reserves & Resources 45 8. Financial Information 48 19
Slide 20: Greens Creek: High Grade & High Margin
HECLA MINING COMPANY Appendix 1 Greens Creek: High Grade & High Margin Gold Cash cost, after by-product Silver Production Production credits, per silver oz1 2014 Actual 7.8 Moz 58,753 oz $2.89/oz 2015E 7.3 Moz 55,000 oz $4.50/oz 2015E Capital $40M Ownership 1987(29.7%) / 2008(100%) 2P Reserves 94.0
Slide 21: Greens Creek: Strong Financial Performance
HECLA MINING COMPANY Appendix 1 Greens Creek: Strong Financial Performance 30 Vein Past 25 Years1 Revenue $4.4 billion Consistently Net Income $1.1 billion Generates Free Cash Flow $941 million Positive Free Cash Flow 22% Free Cash Flow Conversion Historical Production Past 25 Years Silver Productio
Slide 22: Greens Creek: Consistent, Low Cost Production
HECLA MINING COMPANY Appendix 1 Greens Creek: Consistent, Low Cost Production Historical Production Past 25 Years Silver Production: Zinc Production: 192 Moz (7.68 Moz avg/yr) 1.4 M tons (56k tons avg/yr) Gold Production: Lead Production: 1.5 Moz (60k avg/yr) 0.5 M tons (20k tons avg/yr) Cash Cost,
Slide 23: Greens Creek - Location and Layout
HECLA MINING COMPANY Appendix 1 Greens Creek - Location and Layout Auke Bay Juneau Douglas Island Hawk Inlet Young Bay Marine Terminal (Cannery) “A” Road Tailings Admiralty Island Facility 920 Portal Site “B” Road 23
Slide 24: Greens Creek - Capital: Historic and Projected
HECLA MINING COMPANY Appendix 1 Greens Creek - Capital: Historic and Projected $70,000 $62,184 $60,000 $57,119 $50,000 $41,657 Thousands $40,000 $35,747E¹ $30,000 $20,000 $18,280 $13,421 $10,000 $0 2009 2010 2011 2012 2013 2014 1. 2014E is company guidance for 2014 24
Slide 25: Lucky Friday: Back at Full Production
HECLA MINING COMPANY Appendix 2 Lucky Friday: Back at Full Production Cash cost, after by-product Silver Production credits, per silver oz1 2014 Actual 3.2 Moz $9.44/oz 2015E 3.2 Moz $9.75/oz 2015E Capital $58M Ownership 1958 2P Reserves 78.9 Moz silver @ 13.4 oz/t M+I Resources 125.0Moz silver @ 5.
Slide 26: Lucky Friday: It’s Back!
HECLA MINING COMPANY Appendix 2 Lucky Friday: It’s Back! 3.5 $25 3.2 Moz Cash Cost, After By-Product Credits, Per Silver Ounce 3.0 $19.21/oz $20 Silver Ounces Produced (Moz) 2.5 $15 2.0 1.5 Moz 1.5 $10 $9.44/oz 1.0 $5 0.5 0.0 $0 2013 2014 1 Silver Production Cash Cost, After By-Product Credits, Per
Slide 27: Lucky Friday - Capital: Historic and Projected
HECLA MINING COMPANY Appendix 2 Lucky Friday - Capital: Historic and Projected $70,000 $60,067 $60,000 $55,998 $55,902 $56,045E¹ $54,370 $50,000 Thousands $40,000 $30,000 $20,000 $15,990 $10,000 $0 2009 2010 2011 2012 2013 2014 1. 2014E is company guidance for 2014 27
Slide 28: Lucky Friday #4 Shaft: Progressing Well
HECLA MINING COMPANY Appendix 2 Lucky Friday #4 Shaft: Progressing Well Top of shaft at 4900 feet below surface, bottom at 8800 below surface #4 Shaft is 5,000 feet northwest of the Silver Shaft Work began Q4 2009 with lateral development Hoisting facility complete Q4 2011 Completion forec
Slide 29: Casa Berardi - Located In A Golden Neighborhood
HECLA MINING COMPANY Appendix 3 Casa Berardi - Located In A Golden Neighborhood 29
Slide 30: Casa Berardi - Capital: Historic and Projected
HECLA MINING COMPANY Appendix 3 Casa Berardi - Capital: Historic and Projected $80,000 $71,1091 $70,000 $67,695 $60,000 $51,796E2 $50,000 Thousands $40,000 $37,800 $30,000 $22,074 $20,247 $20,000 $10,000 $0 2009 2010 2011 2012 2013 2014 1. Acquired by Hecla 6/1/13 2. 2014E is company guidance for 20
Slide 31: Overview - Greens Creek Surface Exploration
HECLA MINING COMPANY Appendix 4 Overview - Greens Creek Surface Exploration Surface Drill holes 31
Slide 32: Greens Creek: Advancing Killer Creek
HECLA MINING COMPANY Appendix 4 Greens Creek: Advancing Killer Creek Drilling has defined copper, silver, zinc, lead bearing stockwork veins Drilling has defined base metal mineralization at mine contact Mineralization within 1 mile of mine infrastructure A A’ Azimuth 51 32
Slide 33: San Sebastian: Near-Term Growth Opportunity
HECLA MINING COMPANY Appendix 4 San Sebastian: Near-Term Growth Opportunity Could Potentially Become a 100M AgEq oz. District Mined 11.3 million oz Ag and 155,937 oz Au from 2001-05 Contains indicated resources¹ of 25,902,100 Ag Eq oz and inferred resources of 29,459,200 Ag Eq oz New near-surf
Slide 34: San Sebastian: High Grade Near Surface
HECLA MINING COMPANY Appendix 4 San Sebastian: High Grade Near Surface 3D Cross Section Vein NE SW EAST FRANCINE NORTH VEIN 100M FRANCINE MIDDLE VEIN 0 200 Surface to 100 Meters: Meters Silver Equivalent (Oxide) • 16.2 million ounces indicated resources HUGH ZONE • average grade of 0.11 oz/ton gold
Slide 35: San Sebastian: Successful 2014 RAB Drilling
HECLA MINING COMPANY Appendix 4 San Sebastian: Successful 2014 RAB Drilling 35
Slide 36: San Sebastian North Vein Intersection
HECLA MINING COMPANY Appendix 4 San Sebastian North Vein Intersection SW NE SS-523 SS-524 SS-521 SS-525 EXT EXT EXT SS-536 SS-532 SS-552 SS-590 13.3 ft, 0.08 opt Au, 2.0 opt Ag 12.6 ft, 0.10 opt Au, 4.4 opt Ag 16.2 ft, 0.19 opt Au, 4.4 opt Ag 14.7 ft, 0.08 opt Au, 2.2 opt Ag 11.3 ft, 0.06 opt Au, 3.
Slide 37: San Juan Silver (Colorado)
HECLA MINING COMPANY Appendix 4 San Juan Silver (Colorado) Bulldog Surface Infrastructure Includes historic Bulldog mine: produced 25 million ounces of silver before closing in 1985 7.6 million ounces of silver indicated resources¹ 33.1 million ounces of silver inferred resources Bulldog dec
Slide 38: Good Early Stage Exploration Potential
HECLA MINING COMPANY Appendix 4 Good Early Stage Exploration Potential Heva (Au): 100% Hecla: $0.7M proposal 20 holes, 6,750 m Extend high-grade resource blocks and change perception. Fayolle JV (Au): $0.5M proposal 24 holes, 8,100 m proposal Test the Cinco and Paré areas for new deposits. Opinaca (
Slide 39: Gold & Silver: Physical vs. Financial
HECLA MINING COMPANY Appendix 5 Gold & Silver: Physical vs. Financial EAST vs. WEST 1,200 3,000 Tonnes Gold (thousands) 1,000 Net Imports (China) 2,500 Gold Tonnes 800 2,000 600 1,500 400 1,000 Total Known ETF 500 Holdings of Gold 200 0 - 2009 2010 2011 2012 2013 Source: Bloomberg, Source: Bloomberg
Slide 40: Silver - The Metal of This Age
HECLA MINING COMPANY Appendix 5 Silver - The Metal of This Age Has the highest electrical conductivity of all the metals 80% more conductive than aluminum 50% more conductive than gold, 6% more conductive than copper Critically important in the miniaturization of circuits as electronic items
Slide 41: Increasing Share of Modern Demand
HECLA MINING COMPANY Appendix 5 Increasing Share of Modern Demand Modern demand increased from 260 M oz in 1992 to 537 M oz in 2013, an increase of 106%, and an annualized increase of 4.0% 1% 5% 22% 36% 49% 30% Modern Modern 23% 29% 5% 1992 2013 Modern Investment Jewelry & Photography Coins & Meda
Slide 42: Silver Consumption per Capita Increases
HECLA MINING COMPANY Appendix 5 Silver Consumption per Capita Increases Increasing Silver Consumption Per Person in China and India 0.80 0.80 Japan 0.70 0.70 South Korea 0.60 0.60 Silver Ounce Per Capita Silver Ounce Per Capita 0.50 0.50 United Japan 0.40 0.40 States Germany 0.30 0.30 United 0.20 St
Slide 43: Zinc Supply Shortage Expected
HECLA MINING COMPANY Appendix 6 Zinc Supply Shortage Expected Hecla is the 3rd largest zinc supplier in the US Demand is expected to exceed mine production around 2017 Major Mine Shutdowns Annual Capacity Mine (MT) CLOSED Perseverance 115K (2013) CLOSED Brunswick 240K (2013) EXPECTED Century 510
Slide 44: Zinc Supply - US Production
HECLA MINING COMPANY Appendix 6 Zinc Supply - US Production Hecla is the 3rd largest zinc producer in the US % of USA Zinc Production 2013 Comparison of 2013 Zinc Production Doe Run East 3.92% Tennessee Mines 125 9.37% Zinc Production (thousands tonnes) Gordonsville 6.61% 87 Greens Creek 56 6.90%
Slide 45: Proven & Probable Reserves
HECLA MINING COMPANY Appendix 7 Proven & Probable Reserves Proven Reserves Silver Gold Lead Zinc Silver Gold Lead Zinc Asset Location Ownership Tons (000) (oz/ton) (oz/ton) % % (000 oz) (000 oz) Tons Tons Greens Creek (a) United States 100.0% 4.7 15.7 0.10 3.7 9.2 74 0.5 180 440 Lucky Friday (a) Uni
Slide 46: Reserves & Resources Update
HECLA MINING COMPANY Appendix 7 Reserves & Resources Update (on Dec. 31, 2014 unless otherwise noted) Measured Resources Silver Gold Lead Zinc Silver Gold Lead Zinc Asset Location Ownership Tons (000) (oz/ton) (oz/ton) % % (000 oz) (000 oz) (Tons) (Tons) Greens Creek (b) United States 100.0% - - - -
Slide 47: Reserves & Resources Update
HECLA MINING COMPANY Appendix 7 Reserves & Resources Update (on Dec. 31, 2014 unless otherwise noted) Inferred Resources Silver Gold Lead Zinc Silver Gold Lead Zinc Asset Location Ownership Tons (000) (oz/ton) (oz/ton) % % (000 oz) (000 oz) (Tons) (Tons) Greens Creek (b) United States 100.0% 3,452 1
Slide 48: Hecla is Undervalued
HECLA MINING COMPANY Appendix 8 Hecla is Undervalued % Undervalued Per Consensus Estimates P/CFPS – 2015 -8% EV/PRODUCTION (Silver Eq.) -5% EV/RESERVES (Silver Eq.) -38% P/CF - 2015 16.8x 13.6x 13.0x Average, 11.0x 10.5x 10.0x 10.1x 8.8x 5.1x Silver Standard Endeavor Silver Pan American Hecla ‐Hecla
Slide 49: Hecla Is A Strong Cash Flow Generator
HECLA MINING COMPANY Appendix 8 Hecla Is A Strong Cash Flow Generator Cash Bridge 2010 – 2014 (US$ Millions) Partially Discretionary $752.7M Available $971.91 1 Cash Flow $219.2M Other Expenses $265.3M $550.4 $160.1 $42.2 $209.7 $151.2 $104.7 $263.4 $1.92 2010 Beginning Adjusted EBITDA Capex Explora
Slide 50: Financial Strength: 2014 Highlights
HECLA MINING COMPANY Appendix 8 Financial Strength: 2014 Highlights Silver Equivalent Production1 +50% 34.5 Moz 23.0 Moz 2013 2014 2013 2014 Revenue $383 M $501 M +31% Adjusted EBITDA2 $135 M $174 M +29% Cash cost, after by-product credits, per silver oz3 $6.84/oz $4.81/oz -30% Cash cost, after by-p
Slide 51: Strong Liquidity
HECLA MINING COMPANY Appendix 8 Strong Liquidity $384 $367 $312 $310 $291 $284 $267 $191 $212 $210 2010 2011 2012 2013 2014 (US$ millions) 51
Slide 52: Diversified Revenue - Silver, Gold, Lead and Zinc
HECLA MINING COMPANY Appendix 8 Diversified Revenue - Silver, Gold, Lead and Zinc #1 Silver and #3 Lead and Zinc Producer in the U.S. Diversified revenue - 3 mines (silver, gold, lead and zinc) Consolidated Revenue by Metal 2014 Hedge up to 60% of the next 3 years of lead and zinc payable 17% 31
Slide 53: Cash Cost GAAP Reconciliation
HECLA MINING COMPANY Appendix 8 Cash Cost GAAP Reconciliation Reconciliation of cash cost, after by-product credits, per silver ounce to cost of sales and other direct production costs and depreciation, depletion and amortization, the most comparable GAAP measurements, for Greens Creek & Lucky Frida
Slide 54: Cash Cost GAAP Reconciliation
HECLA MINING COMPANY Appendix 8 Cash Cost GAAP Reconciliation Greens Creek Lucky Friday Q4/2014 Q3/2014 Q2/2014 Q1/2014 Q4/2013 Q4/2014 Q3/2014 Q2/2014 Q1/2014 Q4/2013 $ 51,828 $ 50,415 $ 50,405 $ 46,599 $ 50,906 Cash costs, before by-product credits (1) $ 18,361 $ 21,668 $ 19,646 $ 17,920 $ 18,766
Slide 55: Hecla Adjusted EBITDA Reconciliation
HECLA MINING COMPANY Appendix 8 Hecla Adjusted EBITDA Reconciliation Reconciliation of Net Income (Loss) (GAAP) to Adjusted EBITDA (non-GAAP) Three Months Ended Twelve Months Ended 31-Dec-14 31-Dec-13 31-Dec-14 31-Dec-13 Net income (loss) $ 12,340 $ (2,908) $ 13,259 $ (25,130) Plus: Interest expense
Slide 56: Hecla Adjusted EBITDA Reconciliation
HECLA MINING COMPANY Appendix 8 Hecla Adjusted EBITDA Reconciliation Reconciliation of Net Income (Loss) (GAAP) to Adjusted EBITDA (non-GAAP) Twelve Months Ended December 31, 2014 2013 2012 2011 2010 Net Income (Loss) $ 17,824 $ (25,130) $ 14,954 $ 151,164 $ 48,983 Plus: Interest expense, net of amo
Slide 57: High Yield is “Good” Debt
HECLA MINING COMPANY Appendix 8 High Yield is “Good” Debt $500M in high yield notes gives us: Growth Purchased Casa Berardi, a long life gold mine Flexibility No restrictive financial covenants Low cost 6.875% coupon or ~5% after tax capital Long term Zero repayment obligations until 2021 borrowings
Slide 58: HL: No Debt Repayment Obligations Until 2021
HECLA MINING COMPANY Appendix 8 HL: No Debt Repayment Obligations Until 2021 Peer Comparison Date Gross Current 1 Issuer Issued Coupon Maturity Proceeds Rating Hecla 12-Apr-13 6.875% Sr. Unsecured 1-May-21 $500 B3/B AuRico Gold 17-Mar-14 7.750% Sr. Secured 1-Apr-20 $315 B3/B Coeur 24-Jan-13 7.875% S