Hecla Mining Company

Good morning. My name is Rob and I will be your conference operator today. At this time, I would like to welcome everyone to the Hekla Mining Company first quarter 2023 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press the star one. Thank you. And Vita Patil, Vice President, Investor Relations and Treasurer, you may begin your conference.

Good morning, Rob, and thank you all for joining us for HECLA's first quarter 2023 financial and operations results conference call. I'm Anvita Patil, HECLA's Vice President of Investor Relations and Treasurer. Our financial results news release that was issued this morning, along with today's presentation, are available on HECLA's website. On today's call, we have Phil Baker, HECLA's President and CEO, Lauren Roberts, HECLA's Senior Vice President and Chief Operating Officer, and Russell Lawler, HECLA's Senior Vice President and Chief Financial Officer. Any forward-looking statements made today by the management team come under the Private Securities Litigation Reform Act and involve risks as shown on slides two and three in our earnings release and in our 10-K and 10-Q filings with the SEC. These and other risks could cause results to differ from those projected in the forward-looking statements. Reconciliations of non-GAAP measures cited in this call and related slides are found in the slides or the news release. With that, I will pass the call to Phil.

Thanks, Indita. Good morning, everyone. Thanks for joining our call. I'm going to start on slide four. You know, April 16th marked the 15th anniversary of Heckler's purchase of Rio Tinto's interest in Greens Creek. And Greens Creek's been our foundational asset. It's really what's allowing us to be the fastest growing established silver producer. With that acquisition of Greens Creek that we made those years ago, we made a commitment to primarily focus our efforts in tier one jurisdictions. Now we are the largest producer of silver in the U.S. and soon in Canada. But HECLA is not just about jurisdictions, although I'm going to come back to jurisdictions at the end of our prepared remarks. HECLA is about creating real value on a per share basis by exploring, innovating, and executing on our large property positions. And it all starts with Greens Creek, which has provided the stability, cash flow, and about 30% of our production growth over the last 15 years. Its employees have done a phenomenal job of continuously improving, making Greens Creek a longer-lived, lower-cost, more productive mine. This is real value to shareholders. And Greens Creek's success is allowing HECLA to invest in the Lucky Friday and Kino. The investment in Lucky Friday has allowed its production growth in the last five years to go from less than a million ounces to more than four million with more growth on the horizon. and substantial growth over the next few years will be primarily from Keno that should produce more than 2.5 million ounces this year and about 4 million ounces next year. Since 2008, production has about doubled and is expected to be 17 million ounces this year, and then we expect to increase to about 20 million ounces by 2025, which we project will be our sustained production profile for the foreseeable future. Not only have we seen our production grow and expect that growth to continue, we've also been growing our reserves. In fact, from 2008 to 2022, our silver reserves have increased by a factor of five. And most importantly, production reserve growth over the past 15 years has created value on a per share basis. And this is shown on the graph on the right. Our average silver equivalent production and equivalent reserve per share has increased almost two times since 2008. This reserve growth is due to a core tenet of our strategy, and that's to acquire large land packages in good jurisdictions. And we continue to execute on this with the announcement of the ATAC resources acquisition, which brings us a huge land package of more than 650 square miles in the Yukon that's near Keno. We expect the transaction to close in the third quarter. April of this year also marks the 10th year of our acquisition of Casa Berardi, which when we acquired it was solely an underground mine. And it transitioned to a combination of underground and open pit operations in 2016. And now we're starting that transition to only being an open pit mine. This will require investment over the next few years. The investment amount will depend on how long we continue mining underground and the margins it generates. But what this will lead to is mining higher grade open pit materials in a few years. This higher grade ore is in the permitting pipeline, and the reserve grades are almost 70% higher than the current operating pit. And the same rationale for why we bought Casabarati still holds. We have exposure to great geology, large land package, significant infrastructure, Dore production, and exposure to gold whose volatility is less than silver. As we turn to slide five, I will narrow our focus from the strategy we've been implementing over time to some of the details of the first quarter. The key takeaways are it was a strong operational quarter with free cash flow generation from the silver mines that were on track to achieve our production and cost guidance and strong safety performance across the company. Greens Creek achieved record quarterly throughput, breaking the record set just last quarter and turned in very strong silver and gold production, record gold production, in fact. At Lucky Friday, we achieved our safest quarter when at full production, which is an extraordinary feat considering the 80-plus years Lucky Friday has been operating. And its safety record was achieved while silver production exceeded 1.2 million ounces. This is the third time the mine has achieved that in the last four quarters. And the development at Keno Hill is on track for a mill startup in the third quarter with production expected to exceed 2.5 million ounces. Lauren's going to talk more about these properties in just a couple of minutes. This operational performance has translated into financial performance. For two consecutive quarters now, silver is now our leading source of revenue due to significantly more silver production. And the cash flow generation of both Green Streak and Lucky Friday was more than $31 million each and combined for $69 million. Our capital allocation priority is investing in our mines to grow profit production, so this quarter we invested $17 million each in Kino and CASA and $14 million in the Lucky Friday. Green Streak will see relatively more capital in the coming quarters. However, what is most important is our commitment to keeping our employees safe and we have our lowest all injury frequency rate in our history because in 2012 we implemented the National Mining Corps Safety Program. We expect to release our 2022 sustainability report at our annual shareholder meeting on May 23rd and give our high-grade And given our high-grade underground operations, we are net zero in 2022 on scope one and two carbon emissions, which were offset with UN-certified credits. By the way, the annual meeting will be both in person and webcast, so I hope you'll listen in. And with that, I'll pass the call over to Russell to talk about our financials. Thanks, Phil.