Hot Stock under Review: Hecla Mining Company (NYSE: HL)

On Monday, Shares of Hecla Mining Company (NYSE: HL) showed the bearish trend with a lower momentum of -0.29% and ended its trading session at $3.47. The company traded total volume of 2.75M shares as contrast to its average volume of 3.66M shares. The company has a market value of $1.41B and about 406.38M shares outstanding. During the 52-week trading session, the minimum price at which share price traded was registered at $3.25 and reached the max level of $5.57.

Hecla Mining Company (NYSE:HL) recently declared first quarter financial and operating results.

FINANCIAL OVERVIEW:

Net income for the first quarter of $8.20M, a decrease of $18.60M from the first quarter of 2017 influenced by the following factors:

  • Tax provision of $0.80M contrast to a tax benefit of $29.10M in the first quarter of 2017. The 2017 benefit was mainly related to the impact of receiving IRS approval to accelerate the timing of deductions for the Lucky Friday #4 Shaft development costs.
  • Lucky Friday suspension costs of $4.10M, together with $0.90M in non-cash depreciation, related to the strike that began in mid-March 2017, contrast to $1.20M in suspension costs and $0.40M in non-cash depreciation recorded in the first quarter of 2017.
  • Exploration and pre-development spending increase of $2.60M contrast to the first quarter of 2017. In 2018, exploration work continues at Greens Creek, San Sebastian, and Casa Berardi, and on the land package near Lucky Friday. Pre-development work is related to advancement of Montanore and Rock Creek projects.
  • $2.50M in costs related to the projected acquisition of Klondex.
  • Interest expense, net of amount capitalized, of $9.80M in the first quarter of 2018, increased over the $8.50M recognized in first quarter of 2017, because of lower capitalized interest as a result of completion of #4 Shaft and the addition of the Ressources Québec financing received in March 2018.

Operating cash flow of $16.40M reduced 57% over the first quarter of 2017 principally because of reduced silver and lead production and lower silver prices, higher product inventories because of the timing of sales at Greens Creek, and the timing of payment of incentive compensation related to prior year performance, partially offset by higher gold production and higher gold and base metals prices.

Adjusted EBITDA of $58.40M increased 8% over the first quarter of 2017, mainly because of higher gold and base metals prices and higher gold production at Casa Berardi.

Capital expenditures (excluding capitalized interest) totaled $20.00M for the first quarter of 2018 contrast to $23.30M in the prior year period, with the decrease mainly because of lower expenditures at Casa Berardi of $3.30M, Lucky Friday of $3.00M and San Sebastian of $1.30M, partly offset by increased expenditures at Greens Creek of $4.20M. Expenditures at Greens Creek, Casa Berardi, Lucky Friday and Sans Sebastian were $9.50M, $9.10M, $1.00M, and $0.40M respectively.

The Company offered net profit margin of -7.40% while its gross profit margin was 28.00%. ROE was recorded as -2.80% while beta factor was 0.27. The stock, as of recent close, has shown the weekly downbeat performance of -6.22% which was maintained at -12.59% in this year.

Marion Frost

Marion Frost

I am Marion Frost and I have over 16 years experience in the financial services industry giving me a vast understanding of how news affects the financial markets. I am an active day trader spending the majority of my time analyzing earnings reports and watching commodities and derivatives. I have a Masters Degree in Economics from Westminster University with previous roles counting Investment Banking.