Hecla Mining Company

Thank you for standing by. My name is Van and I will be your conference operator today. At this time, I would like to welcome everyone to the Q3 2025 Hekla Mining Company 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, press star one again. Thank you. I would now like to turn the call over to Mike Parkin, Vice President, Strategy and Investor Relations. Please go ahead.

Thank you and good morning for joining us on HECLA's third quarter 2025 results conference call. I am Mike Parkin, Vice President, Strategy and Investor Relations. Our earnings release that was issued yesterday along with today's presentation are available on our website. On the call today is Rob Krichmarov, President and Chief Executive Officer, Russell Lawler, Senior Vice President and Chief Financial Officer, Carlos Aguilar, Senior Vice President and Chief Operations Officer, Curt Allen, Vice President Exploration, as well as other members of the management team. At the conclusion of our prepared remarks, we will all be available to answer questions. Turning to slide two, cautionary statements. Any forward-looking statements made today by the management team come under the Private Securities Litigation Reform Act and involve risks as shown on slide two. In our earnings release and in our 10Q filings with the SEC, these and other risks could cause results to differ from those projected in the forward-looking statements. Non-GAAP measures cited in this call and related slides are reconciled in the slides or the news release. I will now pass the call over to Rob.

Thank you, Mike, and good morning, everyone. So turning to slide three, let me just start by reminding you why Heckler stands apart in the silver sector. You know, as the oldest silver company on the New York Stock Exchange with a history dating back 134 years, we operate exclusively in the premier jurisdictions of the United States and Canada. We maintain peer-leading silver exposure on both a revenue and resource basis with an average reserve life that's double our peer growth. We're building project momentum through strategic investment in our pipeline and we're achieving cost excellence as the lowest cost producer among our peers. And I've got to say, these are exciting times and Heckler really is thriving on strong silver and gold prices. We're using this momentum to strengthen our finances, fund high return projects and boost shareholder value. But I think the outlook's even brighter. Silver faces its fifth consecutive year of supply shortages, with rising industrial demand and investment flows expected to support prices for years to come. And unlike most of our peers, we're uniquely positioned with one of the most favourable silver to gold revenue ratios in the sector, allowing us to capitalise on this silver strength and drive meaningful value creation for our shareholders. Moving to slide four. Q3 really was exceptional, and just let me walk you through why. Firstly, record results. We delivered record results this quarter. We hit revenues of $410 million. Net income came in at $101 million, and adjusted EBITDA was $196 million. These aren't just numbers. They prove that our business model works. We capture upside in strong markets while our cost position offers protection in weak ones. Now, here's what matters a lot, and that's our balance sheet transformation. Net leverage has improved from 1.8 times this time last year to 0.3 times in Q3. So that's an 83% reduction, and that's in a single year. That's a structural de-risking of the company. This de-leveraging consisted of fully repaying our revolver, redeeming $212 million of debt, and paying the $50 million Canadian note due to Investment Quebec. So this deleveraging effort has eliminated over $15 million in annual interest expense. We've gone from being capital constrained to capital flexible. Our cash flow generation has been nothing short of stellar. We've generated $148 million in operating cash flow, while consolidated free cash flow came in at $90 million. And here's the key piece, all four of our producing assets, Greens Creek, Lucky Friday, Casa Berardi, Kino Hill, generated positive free cash flow for the second consecutive quarter. So that's operational momentum. On the operational front, our silver production was 4.6 million ounces, up 2% from last quarter. Cash costs were negative $2.03 per ounce, thanks to strong by-product credits, while all sustaining costs came in $11.01. As a result of this performance, we've tightened our production guidance and reiterated the cost guidance. Our surface cooling project is progressing on track and is expected for completion in the first half of 2026, while Greens Creek received its weapons permit for the dry stack tailings expansion. Completion of these projects is critical to the future success of the company. So in summary, our operations have executed really well. We've de-risked the balance sheet and built financial flexibility. We're cash generating across all assets. And we're positioned to invest in growth. And that's the transformation story. I'll now pass the call over to Russell.