Hecla Mining Company (HL) Q3 2026 earnings review
Hecla builds record cash, but permit limits slow Keno Hill
Hecla Mining is generating record cash from high metal prices even as its mines produce less silver. Third-quarter revenue rose 25% from a year ago as delayed shipments from its Alaskan mine cleared, lifting cash on hand to $692 million with no debt. Chief executive Rob Krcmarov lowered the full-year per-ounce cost outlook, but by our math the production plan points to fourth-quarter silver output falling 18% from the third quarter.
| Revenue | $394.8M +25% from a year ago |
|---|---|
| Free cash flow | $151.2M +165% from a year ago (record) |
| Silver production | 4.17M oz -9% from a year ago |
| Full-year mining cost (AISC) outlook | Lowered $1/oz middle of the range: $12.00/oz |
⚖️ Verdict: ⚪ Neutral
The story is unchanged because booming price-driven cash flow and tighter physical mine limits moved in opposite directions. A $64 per ounce realized silver price and strong gold and zinc credits cut net mining costs and added $208 million to the cash pile in three months. The bad news: right after Keno Hill hit a record 963,048 ounces, Hecla announced it will throttle the mill starting in the fourth quarter and cut deeper in January 2027 so its remaining 200,000 tons of permitted waste space last until mid-2029.
The question now is whether small, low-cost projects at Greens Creek can replace the lost Keno Hill growth before 2029. One view is that recovering extra metal from Greens Creek waste will add over 1 million ounces of silver a year by 2028; the other is that the project remains unapproved while Keno Hill's cutbacks start immediately. February's 2027 production outlook for Keno Hill and the final investment decision on the Greens Creek circuit will settle it.
🐂 Bull Case
High Silver Prices Built a Record Cash Pile
Hecla Mining, the largest silver producer in the United States and Canada, turned high metal prices into record free cash flow of $151.2 million. "Our free cash flow generation and debt-free balance sheet provide us with the strongest financial position in our history, with nearly $700 million in cash and total liquidity of approximately $1.2 billion," chief executive Rob Krcmarov said.
- Cash and cash equivalents: $691.6 million, up 43% from last quarter
- Investment sales proceeds: $63.7 million collected during the quarter
- Realized silver price: $63.62 per ounce, up 49% from a year ago
- New credit line: $500 million undrawn facility, replacing the older $225 million line
This matters because the miner carried more than $500 million of net debt less than two years ago and paid off its last senior notes in April. It can now pay for its mine expansions out of pocket without selling new shares.
What to watch: the fourth-quarter dividend announcement or a capital return update in February 2027. A higher payout would show that the board sees cash above $690 million as more than the mines need.
By-Product Credits Cut Full-Year Mining Cost Plan
Hecla measures mine efficiency using all-in sustaining cost (AISC), the cost to mine an ounce of silver Including ongoing mine upkeep and after subtracting sales of other metals dug up alongside it. The company lowered its full-year AISC plan by $1.00 per ounce to $11.50–$12.50, even though third-quarter AISC rose to $14.34 from $6.07 last quarter.
The quarterly jump happened because costs applicable to sales, the direct cost of mining and milling ore, rose 4.9 percentage points of revenue from last quarter as delayed shipments cleared. Across the first nine months, however, AISC averaged $9.37 per ounce because gold and zinc sales covered more of the mining bill and smelter treatment charges turned into a net credit under "favorable market conditions that could persist through the fourth quarter of 2026".
What to watch: fourth-quarter treatment charges and gold output at the Greens Creek mine in Alaska. By our math, the full-year plan leaves room for fourth-quarter AISC to rise above $20 per ounce as capital spending steps up.
Greens Creek Shipments Cleared the Second-Quarter Backlog
At the end of June, Hecla held a large stock of unsold metal concentrate at its Greens Creek mine because ships load at the port only once a month. Those delayed shipments sailed in the third quarter and lifted company-wide revenue 18% from last quarter to $394.8 million.
Greens Creek sold 20,516 tons of silver concentrate while producing 16,116 tons, which pushed total payable silver sold up 23% from last quarter to 4.09 million ounces. That shipment catch-up helped the Alaskan mine generate $146.8 million of free cash flow, a single-quarter record for the site.
What to watch: fourth-quarter concentrate sales against concentrate produced at Greens Creek. With the mid-year inventory backlog now cleared, fourth-quarter revenue will track actual mine output rather than port timing.
🐻 Bear Case
Permit Limits Will Throttle Keno Hill Until 2029
Keno Hill, Hecla's newer silver mine in Canada's Yukon territory, just had its best quarter since the company bought it. Silver output jumped 54% from last quarter to 963,048 ounces as the mill processed a record 38,163 tons of ore at a 36% richer silver grade.
Yet the miner will deliberately cut Keno Hill's milling rate to about 300 tons per day in the fourth quarter and reduce it further "beginning in January 2027 to levels significantly below third quarter 2026 throughput". Hecla is slowing the plant "to preserve the tailings storage, waste rock and water treatment capacity available under our current permits while we pursue the license amendments needed to expand that capacity".
Only about 200,000 tons of waste storage space remain, and the company does not expect the new government permits until roughly mid-2029. Even on its record third-quarter volume, Keno Hill burned $2.1 million of free cash flow after $11.2 million of capital spending, and Hecla still excludes the site from company-wide per-ounce cost figures because it has not declared commercial production.
What to watch: the 2027 Keno Hill production outlook in February 2027. By our math, the 2026 plan already points to fourth-quarter Keno Hill output falling about 61% from the third quarter, and 2027 will show the cost of running "more selective in both mining and processing".
Greens Creek Output Fell on Maintenance and Grades
Greens Creek supplies nearly half of Hecla's silver and all of its continuing gold, so its volume sets the pace for the whole group. While higher metal prices lifted revenue, total company silver production fell 9.0% from a year ago to 4.17 million ounces because the Alaskan flagship produced less metal.
- Greens Creek silver output: 1.94 million ounces, down 18% from a year ago and 6% from last quarter
- Greens Creek gold output: 11,996 ounces, down 23% from a year ago and 16% from last quarter
- Full-year Greens Creek direct sales cost plan: raised $10 million to $250 million
Unplanned mill maintenance cut third-quarter processing volume at Greens Creek, and the company plans more scheduled maintenance downtime in the fourth quarter alongside higher on-site power generation costs. That leaves Hecla relying on high silver and gold prices to offset shrinking mine output.
What to watch: fourth-quarter mill throughput and silver grades at Greens Creek. By our math, the mine must produce about 1.99 million ounces of silver in the fourth quarter to reach the middle of its full-year plan, even with the extra maintenance.
Risks this quarter didn't answer
Four standing concerns around costs, shareholder payouts and past asset sales either worsened as expected or received no new numbers in the release.
- Lucky Friday costs: silver output fell 17% from last quarter as the Idaho mine left a rich ore pocket, pushing its AISC up to $27.68 per ounce from $17.08; fourth-quarter commissioning of the surface cooling project will test steady-state costs.
- Shareholder payouts: the board kept the quarterly common dividend at $0.00375 per share ($2.8 million total payout) and bought back no shares despite holding $691.6 million in cash; any policy change waits for board review.
- 20-million-ounce target: the release gave no timetable for the company's long-term 20-million-ounce silver goal while Keno Hill faces throttling through 2029; February 2027 outlooks are the next reading.
- Casa Berardi sale holdback: the release gave no update on how much deferred cash buyer Orezone might withhold over Quebec closure bonding; the quarterly 10-Q filing's contingency footnote will show any change.
👓 Other Themes
Greens Creek and Nevada Projects Advance Before Approval
Hecla added $1–$2 million of 2026 growth capital at Greens Creek to study a pyrite concentrate circuit that could recover 1.0–1.2 million ounces of silver and 10,000–15,000 ounces of gold annually from waste, with "intermittent production of pyrite concentrate in late 2027 using temporary equipment" if the board approves it. The miner will also ship a 5,500-tonne test parcel of dry-stack tailings to a smelter in the fourth quarter and is spending $16 million drilling its Midas, Hollister and Aurora properties in Nevada.
💲 Other KPIs
Spending on mines and equipment rose 32% from last quarter to $51.7 million as construction advanced on the Keno Hill waste storage expansion and Lucky Friday's cooling plant. Across the first nine months, capital spending totaled $130.1 million, running behind schedule and prompting Hecla to cut its full-year spending plan by $9.5 million at the middle of the range.
Profit from continuing operations rose 67% from a year ago and 27% from last quarter to $149.6 million, or $0.22 per share. The quarter included a $26.7 million gain from fair value adjustments on marketable securities, compared with a $9.2 million loss last quarter; by our math, profit excluding those security swings was $122.9 million.
Spending to find new ore rose 47% from last quarter to $17.2 million during the summer drilling season as rigs started turning at Hollister and Aurora in Nevada and four drills ran at Keno Hill. Nine-month spending reached $33.5 million, up from $22.5 million a year ago, leaving $21.5 million for the fourth quarter to meet the unchanged $55 million annual plan.
🔮 Guidance
Raised at the bottom end. The middle of the range moved up 0.1 million ounces to 15.7 million ounces, which still leaves full-year silver output down 7.7% from 2025 continuing operations by our math. With 12.28 million ounces mined in the first nine months, the plan leaves 3.42 million ounces for the fourth quarter by our math, down 18% from the third quarter as Keno Hill slows.
Unchanged. The Alaskan mine remains on a plan for 8.15 million ounces at the middle of the range after Hecla raised the target last quarter. With 6.16 million ounces produced in the first nine months, by our math the outlook leaves 1.99 million ounces for the fourth quarter, slightly above both the third quarter's 1.94 million ounces and last year's fourth quarter.
Raised at the low end. Hecla lifted the floor by 0.1 million ounces for the second straight quarter, putting the middle of the range at 5.1 million ounces. After mining 4.04 million ounces in the first nine months, by our math the plan leaves 1.06 million ounces for the fourth quarter, down 17% from the third quarter as ore grades return toward average.
Raised at the low end. The bottom of the range rose by 0.1 million ounces to put the middle at 2.45 million ounces, following a 21% cut last quarter. Because Keno Hill has already produced 2.08 million ounces in the first nine months, by our math the plan leaves just 0.37 million ounces for the fourth quarter as the mill throttles down to 300 tons per day.
Unchanged. The company kept its gold target steady for a third straight quarter at a middle of 53.0 thousand ounces. With 39.1 thousand ounces produced through September, by our math the plan requires 13.9 thousand ounces in the fourth quarter, up 16% from the third quarter despite scheduled mill maintenance.
Improved. Hecla lowered its expected cash cost by $0.625 per ounce at the middle of the range to negative $4.50, meaning gold, zinc and lead sales more than pay for the direct cost of mining silver at Greens Creek and Lucky Friday. Nine-month cash cost stood at negative $4.94 per ounce, and fourth-quarter by-product credits assume $4,000 gold and $1.40 zinc.
Improved. The company cut its all-in sustaining cost outlook by $1.00 per ounce after cutting it by $2.625 last quarter, bringing the middle of the range to $12.00 per ounce across Greens Creek and Lucky Friday. Because nine-month AISC was $9.37 per ounce, by our math the plan leaves about $20.81 per ounce for the fourth quarter as sustaining capital spending catches up.
Raised by $10 million (a worse cost outcome). Greens Creek's full-year direct production cost plan moved up to $250 million from $240 million on nine-month actuals and higher fourth-quarter on-site power generation costs, while Lucky Friday stayed at $140 million. The two mines recorded $296.8 million in the first nine months, leaving $93.2 million for the fourth quarter by our math.
Lowered. The miner reduced its full-year capital budget by $9.5 million at the middle of the range to $206 million ($142–$153 million sustaining and $56–$61 million growth) because spending ran slower in the first nine months. With $130.1 million spent through September, by our math the outlook still points to $75.9 million in the fourth quarter, up 47% from the third quarter.
Unchanged. The full-year exploration budget remains at $55 million, including $16 million for the Nevada properties. After spending $33.5 million in the first nine months, by our math the plan leaves $21.5 million for the fourth quarter.
❓ Key Questions
How low will Keno Hill milling fall in 2027?
Hecla will cut Keno Hill milling to 300 tons per day in the fourth quarter and reduce it "significantly below" third-quarter levels starting in January 2027. Investors need the daily tonnage needed to stretch 200,000 tons of waste space to mid-2029 and whether Keno Hill will burn cash.
What will the Greens Creek pyrite circuit cost to build?
The company plans intermittent pyrite production in late 2027 using temporary equipment and full capacity in late 2028, adding up to 1.2 million ounces of silver a year. It has not yet given the construction bill, smelter payment terms, or the date for final board approval.
What will Hecla do with $692 million in cash?
Cash rose $208 million in a single quarter for a debt-free company, yet the common dividend stayed at $0.00375 per share ($2.8 million per quarter) with zero share buybacks. Investors need to know what cash level triggers a higher return to shareholders.
Will Orezone cut the deferred Casa Berardi payments?
When Hecla sold the Casa Berardi mine in March, Quebec's closure bonding exceeded the threshold in the sale contract, giving the buyer a right to reduce future cash payments. The release gave no update on how much cash is at risk.