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Hecla Mining (NYSE: HL) said it entered the second quarter of 2026 with no long-term debt, record quarterly cash generation, and a portfolio increasingly focused on silver assets in the United States and Canada after selling its Casa Berardi operation at the end of March.
On the company’s first-quarter earnings call, President and Chief Executive Officer Rob Krcmarov said Hecla has completed a major balance sheet transformation since he joined the company 18 months ago. He said the company previously carried nearly $550 million of net debt and now has no long-term debt.
Hecla reported first-quarter revenue from continuing operations of more than $410 million, up 13% from the prior quarter and double the level from the first quarter of 2025. The company posted record adjusted EBITDA of $265 million and record consolidated free cash flow of $144 million, with each mine generating positive free cash flow.
Krcmarov said 73% of first-quarter revenue came from silver, and all revenue came from the U.S. or Canada.
Hecla’s first-quarter results were presented on a continuing operations basis, excluding Casa Berardi, which was sold at the end of March. Krcmarov described the sale as “a deliberate, well-timed decision” that enabled Hecla to focus capital and management attention on its silver growth platform.
The company said the transaction included cash proceeds, a 9.9% equity stake in Ozones, and deferred cash consideration.
After the quarter ended, Hecla redeemed its remaining $263 million of senior notes on April 9. Chief Financial Officer Russell Lawlar said the company ended the quarter with $588 million in cash and total debt of $266 million, resulting in a net cash position of $321 million. Following the redemption, Hecla has no long-term debt and a fully undrawn $225 million revolving credit facility, with a $75 million accordion feature.
Hecla produced 3.9 million ounces of silver in the quarter, about 3% more than in the prior quarter. The company reiterated its 2026 production guidance of 15.1 million to 16.5 million ounces of silver.
Krcmarov said Hecla sees a potential pathway to more than 20 million ounces annually through Keno Hill’s ramp-up, the potential restart of Midas in Nevada, and other growth opportunities.
Greens Creek produced 2.2 million ounces of silver and 13,000 ounces of gold. The mine generated $131 million in operating cash flow and $126 million in free cash flow. Cash costs were nearly negative $12 per ounce of silver, and all-in sustaining costs were negative $8.39 per ounce, both after by-product credits.
At Lucky Friday, Hecla produced 1.2 million ounces of silver. The mine generated $49 million in free cash flow, with cash costs of $12.07 per ounce and all-in sustaining costs of $23.78 per ounce after by-product credits.
Aguiar said throughput rose 10% from the prior quarter, partly offset by an 11% decline in mill rate, and said average silver grade is expected to improve in the second quarter.
Keno Hill produced nearly 500,000 ounces of silver and generated $15.3 million in free cash flow, marking its fourth consecutive quarter of positive free cash flow.
Aguiar said production was affected by reduced power supply from Yukon Energy due to extreme cold weather and lower grades in part of the Birmingham deposit, but said both headwinds are expected to ease.
Hecla highlighted potential projects at Greens Creek, Nevada and across its exploration portfolio.
Hecla is evaluating a pyrite concentrate circuit at Greens Creek that could add a marketable concentrate stream, improve silver and gold recoveries, and potentially reduce reclamation liabilities. Erickson said the project is currently estimated to be low in capital intensity and could generate cash flow in about two years, with another market update expected in late 2026 or early 2027.
Erickson also discussed the Greens Creek tailings reprocessing project, which remains under evaluation. He said the dry stack facility contains an estimated 10.4 million tons of material with an estimated 50 million ounces of silver and nearly 600,000 ounces of gold, along with other critical minerals. At year-end 2025 prices, the gross metal value is estimated at about $6.8 billion, before recovery rates, costs and required capital. Phase 3 metallurgical test work is expected to be completed around mid-2026.
In Nevada, Hecla is evaluating a restart of Midas using a hub-and-spoke model that could process ore from regional properties through an existing 1,200-ton-per-day permitted mill. Erickson noted the site also has a permitted tailings facility with about 15 years of storage capacity.
The company allocated $16 million to Nevada exploration in 2026, more than three times last year’s investment.
Kurt Allen, Vice President of Exploration, said Hecla is investing $55 million in exploration and pre-development in 2026, described as an all-time record for the company. Programs include drilling at Midas, Hollister and Aurora.
Allen said Aurora, in western Nevada, is earlier stage than Midas but may hold the greatest long-term discovery potential, with seven drill-ready targets and a permitted 600-ton-per-day mill on site.
During the question-and-answer portion of the call, analysts asked about permitting constraints at Keno Hill. Patrick Malone, vice president of sustainability, said Hecla expects to submit a project proposal to the Yukon Environmental and Socio-economic Assessment Board by year-end. He said the review process is expected to take about 12 months, after which Hecla would submit applications to amend its quartz mining license and water license.
Malone said amended permits could be received around mid-2029, though timing is variable. He cited constraints including waste rock, tailings, water treatment, power and camp space. In the near term, Hecla needs regulatory approvals for Phase 2 west tailings expansion, and waste rock could become a limitation before long-term permits are received.
Krcmarov said the ramp-up to 440 tons per day at Keno Hill is expected to be gradual and tied to permitting and water management. He described any potential delay as “a bridge problem” rather than “an asset problem,” citing the mine’s reserve life and economics.
Lawlar said Hecla’s capital allocation priorities begin with safety and environmental performance, followed by sustaining and growth capital, exploration, balance sheet strength, strategic investments and shareholder returns. He said the company has a board-approved share repurchase plan for 20 million shares, but any buybacks would need to meet return-on-capital criteria.
On the silver market, Krcmarov said it remains structurally tight, citing the World Silver Survey’s finding that 2025 marked the fifth consecutive year of supply deficit, with cumulative stock drawdowns exceeding 700 million ounces since 2021. He said Hecla is positioned as a debt-free silver producer with record free cash flow and an organic growth pipeline, while remaining disciplined on potential acquisitions.
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