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Hecla Mining (HL) Q3 Earnings Beat Estimates, Revenues Lag
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Hecla Mining (HL - Free Report) reported a third-quarter 2022 adjusted loss per share of 2 cents compared with the Zacks Consensus Estimate of a loss of 4 cents per share. Earnings were impacted by lower realized prices for all metals, higher costs and lower revenue from the deferral of silver concentrate shipments from Greens Creek and Lucky Friday to fourth-quarter 2022.
Including one-time items, HL reported a loss of 4 cents per share against break-even earnings in the prior-year quarter.
The company’s revenues plunged 24% year over year to $146 million in the quarter under review. The top-line figure lagged the Zacks Consensus Estimate of $167 million.
HL had deferred approximately 1 million ounces of silver, 1,800 ounces of gold, and 1,300 tons of lead in the silver concentrate shipments at Greens Creek to ensure adequate volumes of concentrate for cost-effective shipping. At Lucky Friday the deferral was due to a planned multi-week shutdown of the Trail smelter for maintenance. This along with lower realized metal prices impacted revenues in the quarter.
Gold prices were 4.4% down year over year to $1,713 an ounce. The realized silver price was $18.30 per ounce in the quarter, plunging 24% from $23.97 in the last year’s quarter. Realized prices for lead and zinc were lower by 7% and 9% respectively.
The total cost of sales declined 13% year on year to $138 million in the quarter. Gross profit plummeted 76% to $8.4 million on lower revenues and higher per-unit costs. The gross margin in the third quarter of 2022 was 5.8%, a 1240 basis point contraction from the year-ago quarter.
The company reported an increase in exploration and pre-development expenses owing to increased exploration and drilling activity across its mines and projects during the exploration season. Adjusted EBITDA was $26.6 million, down from $49.4 million in the third quarter of 2021.
The company reported cash costs per silver equivalent ounce and all-in sustaining costs (AISC) per silver ounce of $14.20 in the quarter, marking an 11% increase year over year. This was due to lower by-product credits attributable to lower lead and zinc production as well as lower prices.
Production Numbers
Hecla Mining reported silver production of 3.55 million ounces in the third quarter of 2022, down 3% on a sequential basis. Compared with the third quarter of 2021, production was up 33.6%. The output at the Lucky Friday mine has surpassed the 1 million ounce mark for two consecutive quarters.
Gold production was down 2% to 44,747 ounces compared with the second quarter of 2022. However, compared with the last year’s quarter, gold production was up 6%.
Financial Position
Hecla Mining ended third-quarter 2022 with $145 million of cash in hand, down from the $210 million held at the end of 2021. Cash flow from operating activities was an outflow of $24 million in the third quarter of 2022 compared with an inflow of $42.7 million in the prior-year comparable period.
Guidance
HL expects to produce 13.6-14.1 million ounces of silver in 2022. Gold production is expected in the range of 169,000 ounces to 180,000 ounces.
Price Performance
Image Source: Zacks Investment Research
Shares of Hecla Mining have fallen 21.5% in the past year compared with the industry's decline of 32.6%.
Zacks Rank & Stocks to Consider
Hecla Mining currently carries a Zacks Rank #4 (Sell).
Better-ranked stocks in the basic materials space include Albemarle Corporation (ALB - Free Report) , Commercial Metals Company (CMC - Free Report) and Reliance Steel & Aluminum Co. (RS - Free Report) .
Albemarle, currently carrying a Zacks Rank #2 (Buy), has a projected earnings growth rate of 420.3% for the current year. The Zacks Consensus Estimate for ALB's current-year earnings has been revised 5.8% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Albemarle’s earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 24.2%, on average. ALB has gained around 20% in a year.
Commercial Metals currently carries a Zacks Rank #2. The Zacks Consensus Estimate for CMC's current-year earnings has been revised 3.8% upward in the past 60 days.
Commercial Metals’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 19.7%, on average. CMC has gained around 38% in a year.
Reliance Steel, currently carrying a Zacks Rank #2, has a projected earnings growth rate of 29.7% for the current year. The Zacks Consensus Estimate for RS's current-year earnings has been revised 0.1% upward in the past 60 days.
Reliance Steel’s earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 13.6%, on average. RS has gained around 18% in a year.
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Hecla Mining (HL) Q3 Earnings Beat Estimates, Revenues Lag
Hecla Mining (HL - Free Report) reported a third-quarter 2022 adjusted loss per share of 2 cents compared with the Zacks Consensus Estimate of a loss of 4 cents per share. Earnings were impacted by lower realized prices for all metals, higher costs and lower revenue from the deferral of silver concentrate shipments from Greens Creek and Lucky Friday to fourth-quarter 2022.
Including one-time items, HL reported a loss of 4 cents per share against break-even earnings in the prior-year quarter.
The company’s revenues plunged 24% year over year to $146 million in the quarter under review. The top-line figure lagged the Zacks Consensus Estimate of $167 million.
HL had deferred approximately 1 million ounces of silver, 1,800 ounces of gold, and 1,300 tons of lead in the silver concentrate shipments at Greens Creek to ensure adequate volumes of concentrate for cost-effective shipping. At Lucky Friday the deferral was due to a planned multi-week shutdown of the Trail smelter for maintenance. This along with lower realized metal prices impacted revenues in the quarter.
Gold prices were 4.4% down year over year to $1,713 an ounce. The realized silver price was $18.30 per ounce in the quarter, plunging 24% from $23.97 in the last year’s quarter. Realized prices for lead and zinc were lower by 7% and 9% respectively.
The total cost of sales declined 13% year on year to $138 million in the quarter. Gross profit plummeted 76% to $8.4 million on lower revenues and higher per-unit costs. The gross margin in the third quarter of 2022 was 5.8%, a 1240 basis point contraction from the year-ago quarter.
The company reported an increase in exploration and pre-development expenses owing to increased exploration and drilling activity across its mines and projects during the exploration season. Adjusted EBITDA was $26.6 million, down from $49.4 million in the third quarter of 2021.
The company reported cash costs per silver equivalent ounce and all-in sustaining costs (AISC) per silver ounce of $14.20 in the quarter, marking an 11% increase year over year. This was due to lower by-product credits attributable to lower lead and zinc production as well as lower prices.
Production Numbers
Hecla Mining reported silver production of 3.55 million ounces in the third quarter of 2022, down 3% on a sequential basis. Compared with the third quarter of 2021, production was up 33.6%. The output at the Lucky Friday mine has surpassed the 1 million ounce mark for two consecutive quarters.
Gold production was down 2% to 44,747 ounces compared with the second quarter of 2022. However, compared with the last year’s quarter, gold production was up 6%.
Financial Position
Hecla Mining ended third-quarter 2022 with $145 million of cash in hand, down from the $210 million held at the end of 2021. Cash flow from operating activities was an outflow of $24 million in the third quarter of 2022 compared with an inflow of $42.7 million in the prior-year comparable period.
Guidance
HL expects to produce 13.6-14.1 million ounces of silver in 2022. Gold production is expected in the range of 169,000 ounces to 180,000 ounces.
Price Performance
Image Source: Zacks Investment Research
Shares of Hecla Mining have fallen 21.5% in the past year compared with the industry's decline of 32.6%.
Zacks Rank & Stocks to Consider
Hecla Mining currently carries a Zacks Rank #4 (Sell).
Better-ranked stocks in the basic materials space include Albemarle Corporation (ALB - Free Report) , Commercial Metals Company (CMC - Free Report) and Reliance Steel & Aluminum Co. (RS - Free Report) .
Albemarle, currently carrying a Zacks Rank #2 (Buy), has a projected earnings growth rate of 420.3% for the current year. The Zacks Consensus Estimate for ALB's current-year earnings has been revised 5.8% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Albemarle’s earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 24.2%, on average. ALB has gained around 20% in a year.
Commercial Metals currently carries a Zacks Rank #2. The Zacks Consensus Estimate for CMC's current-year earnings has been revised 3.8% upward in the past 60 days.
Commercial Metals’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 19.7%, on average. CMC has gained around 38% in a year.
Reliance Steel, currently carrying a Zacks Rank #2, has a projected earnings growth rate of 29.7% for the current year. The Zacks Consensus Estimate for RS's current-year earnings has been revised 0.1% upward in the past 60 days.
Reliance Steel’s earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 13.6%, on average. RS has gained around 18% in a year.