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Hecla Mining (HL) Q2 Earnings Beat, Fall Y/Y on Lower Sales
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Hecla Mining Company (HL - Free Report) reported second-quarter 2023 adjusted earnings per share of 3 cents, which was down 25% year over year. The Zacks Consensus Estimate for earnings was pegged at breakeven.
Including one-time items, the company reported a loss of 3 cents per share, flat compared with the prior-year quarter.
The company’s revenues declined 7% year over year to around $178 million in the quarter under review. Lower metal sales, combined with lower realized lead and zinc prices, partially offset by higher precious metals prices, led to the decline in HL’s top line. The figure missed the Zacks Consensus Estimate of $184 million. Around 45% of the revenues pertained to silver and the remaining 35% from gold.
Hecla Mining Company Price, Consensus and EPS Surprise
Gold realized prices moved up 6% year over year to $1,969 an ounce. The realized price for silver was $23.67 per ounce in the quarter, up 14.5% from $20.70 per ounce in the prior-year quarter. Realized prices for lead rose 2% while the same for zinc declined 21.5%.
The total cost of sales decreased 9% year over year to $140.5 million in the quarter. Gross profit inched up 1% to $37.7 million. The gross margin in the second quarter of 2023 was 21.1%, compared with 19.5% in the prior-year quarter. The company reported exploration and pre-development expenses of $6.9 million in the second quarter of 2023. Exploration activities during the quarter were mainly focused on underground targets at Greens Creek and Keno Hill.
Adjusted EBITDA was around $68 million, down from $70.5 million in the second quarter of 2022.
Hecla Mining reported cash costs per silver ounce and all-in-sustaining costs per silver ounce of $3.32 and $11.63, respectively in the second quarter of 2023.
Production Numbers & Mine Updates
Hecla Mining reported silver production of 3.8 million ounces in the second quarter of 2023, up 5% year over year. In the first half of 2023, the company’s total silver output was 7.9 million ounces. Production was up 13% year over year, aided by the upbeat performance at Lucky Friday and Greens Creek. This was the third-highest silver production over a six-month period in the company’s history. Gold production was 35,251 ounces, down 23% from the second quarter of 2022.
The Lucky Friday mine reported silver production of 1.3 million ounces in the second quarter, attaining its highest level since the first quarter of 2000. The Keno Hill mine began ramping up to full production in the second quarter and produced 184,264 ounces of silver. The mine is expected to produce up to 440 tons per day by the end of this year. Silver production from the mine is projected to be more than 2.5 million ounces.
Financial Position
Hecla Mining ended the second quarter of 2023 with $107 million of cash in hand, up from $105 million held at the end of 2022. Cash flow from operating activities was $64.4 million in the first six-month period of 2023, compared with $78 million in the prior-year period.
Production Guidance for 2023
Hecla Mining’s silver production guidance is at 16-17.5 million ounces for 2023. It is targeting to reach the 20-million-ounce mark in 2025. The company already produces 45% of U.S silver and is gearing up to be Canada’s largest silver producer by 2024.
The company expects gold production in the range of 140,000-160,000 ounces, lower than 160,000-170,000 ounces expected earlier. While the company now expects increased gold production at Greens Creek, the revised guidance reflects wildfires-related suspension at Casa Berardi operations in June.
Price Performance
Shares of Hecla Mining have gained 1.7% in the past year against the industry's 12.7% decline.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Hecla Mining currently carries a Zacks Rank #3 (Hold).
Carpenter Technology has an average trailing four-quarter earnings surprise of 10%. The Zacks Consensus Estimate for CRS’s fiscal 2024 earnings is pegged at $3.23 per share. The consensus estimate for fiscal 2024 earnings has moved 12% north in the past 60 days. Its shares have gained 71% in the last year.
The Zacks Consensus Estimate for PPG Industries’ fiscal 2023 earnings per share is pegged at $7.47, indicating growth of 23.5% from the prior-year actual. Earnings estimates have moved 3% north in the past 60 days. It has an average trailing four-quarter earnings surprise of 7.3%. PPG’s shares have gained 9.5% in the past year.
Bunge has an average trailing four-quarter earnings surprise of 20.4%. The Zacks Consensus Estimate for BG’s 2023 earnings is pegged at $12.13 per share. The consensus estimate for 2023 earnings has moved 4% north over the past 60 days. BG’s have shares gained 17.1% in the last year.
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Hecla Mining (HL) Q2 Earnings Beat, Fall Y/Y on Lower Sales
Hecla Mining Company (HL - Free Report) reported second-quarter 2023 adjusted earnings per share of 3 cents, which was down 25% year over year. The Zacks Consensus Estimate for earnings was pegged at breakeven.
Including one-time items, the company reported a loss of 3 cents per share, flat compared with the prior-year quarter.
The company’s revenues declined 7% year over year to around $178 million in the quarter under review. Lower metal sales, combined with lower realized lead and zinc prices, partially offset by higher precious metals prices, led to the decline in HL’s top line. The figure missed the Zacks Consensus Estimate of $184 million. Around 45% of the revenues pertained to silver and the remaining 35% from gold.
Hecla Mining Company Price, Consensus and EPS Surprise
Hecla Mining Company price-consensus-eps-surprise-chart | Hecla Mining Company Quote
Gold realized prices moved up 6% year over year to $1,969 an ounce. The realized price for silver was $23.67 per ounce in the quarter, up 14.5% from $20.70 per ounce in the prior-year quarter. Realized prices for lead rose 2% while the same for zinc declined 21.5%.
The total cost of sales decreased 9% year over year to $140.5 million in the quarter. Gross profit inched up 1% to $37.7 million. The gross margin in the second quarter of 2023 was 21.1%, compared with 19.5% in the prior-year quarter.
The company reported exploration and pre-development expenses of $6.9 million in the second quarter of 2023. Exploration activities during the quarter were mainly focused on underground targets at Greens Creek and Keno Hill.
Adjusted EBITDA was around $68 million, down from $70.5 million in the second quarter of 2022.
Hecla Mining reported cash costs per silver ounce and all-in-sustaining costs per silver ounce of $3.32 and $11.63, respectively in the second quarter of 2023.
Production Numbers & Mine Updates
Hecla Mining reported silver production of 3.8 million ounces in the second quarter of 2023, up 5% year over year. In the first half of 2023, the company’s total silver output was 7.9 million ounces. Production was up 13% year over year, aided by the upbeat performance at Lucky Friday and Greens Creek. This was the third-highest silver production over a six-month period in the company’s history. Gold production was 35,251 ounces, down 23% from the second quarter of 2022.
The Lucky Friday mine reported silver production of 1.3 million ounces in the second quarter, attaining its highest level since the first quarter of 2000. The Keno Hill mine began ramping up to full production in the second quarter and produced 184,264 ounces of silver. The mine is expected to produce up to 440 tons per day by the end of this year. Silver production from the mine is projected to be more than 2.5 million ounces.
Financial Position
Hecla Mining ended the second quarter of 2023 with $107 million of cash in hand, up from $105 million held at the end of 2022. Cash flow from operating activities was $64.4 million in the first six-month period of 2023, compared with $78 million in the prior-year period.
Production Guidance for 2023
Hecla Mining’s silver production guidance is at 16-17.5 million ounces for 2023. It is targeting to reach the 20-million-ounce mark in 2025. The company already produces 45% of U.S silver and is gearing up to be Canada’s largest silver producer by 2024.
The company expects gold production in the range of 140,000-160,000 ounces, lower than 160,000-170,000 ounces expected earlier. While the company now expects increased gold production at Greens Creek, the revised guidance reflects wildfires-related suspension at Casa Berardi operations in June.
Price Performance
Shares of Hecla Mining have gained 1.7% in the past year against the industry's 12.7% decline.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Hecla Mining currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the basic materials space are Carpenter Technology Corporation (CRS - Free Report) , PPG Industries, Inc. (PPG - Free Report) and Bunge Limited (BG - Free Report) . CRS and PPG sport a Zacks Rank #1 (Strong Buy) at present, and BG has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Carpenter Technology has an average trailing four-quarter earnings surprise of 10%. The Zacks Consensus Estimate for CRS’s fiscal 2024 earnings is pegged at $3.23 per share. The consensus estimate for fiscal 2024 earnings has moved 12% north in the past 60 days. Its shares have gained 71% in the last year.
The Zacks Consensus Estimate for PPG Industries’ fiscal 2023 earnings per share is pegged at $7.47, indicating growth of 23.5% from the prior-year actual. Earnings estimates have moved 3% north in the past 60 days. It has an average trailing four-quarter earnings surprise of 7.3%. PPG’s shares have gained 9.5% in the past year.
Bunge has an average trailing four-quarter earnings surprise of 20.4%. The Zacks Consensus Estimate for BG’s 2023 earnings is pegged at $12.13 per share. The consensus estimate for 2023 earnings has moved 4% north over the past 60 days. BG’s have shares gained 17.1% in the last year.