Hecla Mining Company · NYSE:HL
Hecla Mining — World Gold Forum 2020
15 slides from Hecla Mining's conference presentation, Apr 20, 2020
Slide 1: World Gold Forum: In A Changed World Some Things Never Change
WORLD GOLD FORUM In A Changed World Somethings Never Change April 2020 RESPONSIBLE. SAFE. INNOVATIVE. NYSE: HL
Slide 2: Cautionary Statements
CAUTIONARY STATEMENTS Cautionary Statement Regarding Forward Looking Statements 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 Act of 1934, as amended, which are intended
Slide 3: Cautionary Statements (cont'd)
CAUTIONARY STATEMENTS (cont’d) Cautionary Statement Regarding Forward Looking Statements (Cont’d) In addition, material risks that could cause actual results to differ from forward-looking statements include, but are not limited to: (i) gold, silver and other metals price volatility; (ii) operating
Slide 4: Hecla Reacted to COVID-19 Early
HECLA REACTED TO COVID-19 EARLY Positioned to more than survive the pandemic • Fortified the balance sheet • Supply chain strengthened by mid-March • In early February refinanced $475 million Senior Notes • Stockpiled critical mining supplies (up to six at 7.25%, now due 2028 months’ worth in some c
Slide 5: Hecla Has Outperformed When Prices Rise
HECLA HAS OUTPERFORMED WHEN PRICES RISE Low costs, long lived mines in the best jurisdictions with a known ticker Characteristics are unique among peers Asset Overview • Largest primary silver producer in the U.S., 5th largest Quebec gold producer • Best mining jurisdictions: Alaska, Quebec, Idaho,
Slide 6: Best of the Best Mining Jurisdictions
BEST OF THE BEST MINING JURISDICTIONS Unique combination of jurisdiction, mine life, margin and capital efficiency Hecla 2019 Revenue by Operation / Geography Hecla 2019 Assets by Operation / Geography Other Nevada Lucky Friday 11% operations 2% San Sebastian 16% 2% Casa Beradi Greens Creek Lucky Fr
Slide 7: Reserves Are Growing
RESERVES ARE GROWING 129-year record for silver; record for gold in 2018 Silver Reserves Growth (millions of ounces) Gold Reserves Growth (millions of ounces) 2.1 (1.6) 1.5 2.7 153.8 (76.7) 212.2 265%3 147.7 629%3 0.7 2013 Beginning Reserves added Gold produced Additions Reserves, 2013 Beginning Res
Slide 8: Not All Reserves Are the Same
NOT ALL RESERVES ARE THE SAME Hecla’s silver reserve price assumption have been stable and are lower than peer’s Price assumption is at the discretion of management HL Reserve Year Prices $18.00 $17.00 $17.00 $17.00 $17.00 $17.00 $17.00 $17.30 2012 $26.50 $16.00 $16.00 $14.50 2013 $20.00 2014 $17.25
Slide 9: Silver Margins Consistently Strong
SILVER MARGINS CONSISTENTLY STRONG Gold margins improved in 2H19 – 2020 outlook is better Silver Margins Gold Margins 3% 19% 20% 7% 27% 35% 26% 51% 54% 41% (35)% (29)% Cost of Sales (000s)2,* AISC, After By-Product Credits, per Ag-Au/Oz4,** 2017 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 2017 2018 Q1 2019
Slide 10: Each Mine Delivers Value: Cash, Reserves, Growth or All Three
EACH MINE DELIVERS VALUE: CASH, RESERVES, GROWTH OR ALL THREE Capital Costs Are Similar As In The Past Greens Creek Casa Berardi Lucky Friday San Sebastian Nevada • Economic engine • Restart from • Strike resolved • Government • Development of the company government mandated suspended at shutdown •
Slide 11: Refinancing Demonstrates Hecla's Financial Flexibility
REFINANCING DEMONSTRATES HECLA’S FINANCIAL FLEXIBILITY Longer maturity, less interest expense, more liquidity, improved leverage ratio Liquidity Position Components of the Refinancing 1 • Issued $475mm of 7.25% bonds due 2028 Revolver $11 • Q4/2019 Items: • Strong 2H19 CF allowed for full repayment
Slide 12: Appendix
Appendix NYSE: HL RESPONSIBLE. SAFE. INNOVATIVE. l 12
Slide 13: Adjusted EBITDA Reconciliation to GAAP
ADJUSTED EBITDA RECONCILIATION TO GAAP Reconciliation of Net (Loss) Income (GAAP) to Adjusted EBITDA (non-GAAP) Dollars in thousands (USD) Twelve Months Ended 31-Mar-19 30-Jun-19 30-Sep-19 31-Dec-19 Net (loss) income $ (60,336) $ (118,942) $ (115,274) $ (99,557) Plus: Interest expense, net of amount
Slide 14: Cash Cost and AISC Reconciliation to GAAP: Silver Operations
CASH COST AND AISC RECONCILIATION TO GAAP Silver Operations Reconciliation of Cost of Sales and Other Direct Production Costs and Depreciation, Depletion and Amortization (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Costs, Be
Slide 15: Cash Cost and AISC Reconciliation to GAAP: Gold Operations
CASH COST AND AISC RECONCILIATION TO GAAP Gold Operations Reconciliation of Cost of Sales and Other Direct Production Costs and Depreciation, Depletion and Amortization (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Costs, Befo