Hecla Posts Record Q3 2026 Free Cash Flow as Cash Reaches $692 Million

Hecla Mining Company (NYSE: HL) generated record quarterly operating and free cash flow from continuing operations in the third quarter of 2026, strengthening its balance sheet as robust mine-level cash generation offset broadly stable sequential silver production and higher reported all-in sustaining costs.

The U.S. and Canadian silver producer reported $395 million in revenue from continuing operations and income from continuing operations of $149.6 million, or $0.22 per share. Adjusted EBITDA, a non-GAAP measure, reached $211.5 million, up 6% from the second quarter.

Cash provided by operating activities from continuing operations rose to a quarterly record of $203.0 million. After $51.7 million of capital investment, non-GAAP free cash flow was a record $151.2 million, compared with $135.8 million in the preceding quarter.

Hecla ended September with $691.6 million in cash and no long-term debt apart from finance leases. It also had a fully undrawn $500 million revolving credit facility and a $100 million accordion option.

Silver output holds steady as costs rise sequentially

Hecla produced 4.2 million ounces of silver during the quarter, within 1% of second-quarter output. Total costs applicable to sales, excluding depreciation, depletion and amortization, were $158.2 million.

Cash cost was negative $3.20 per silver ounce after by-product credits, while all-in sustaining cost was $14.34 per ounce. Both are non-GAAP measures and compare with negative cash cost of $8.10 and AISC of $6.07 in the second quarter. The consolidated silver cost calculations cover Greens Creek and Lucky Friday and exclude Keno Hill, which has not achieved commercial production.

The company realized an average silver price of $63.62 per ounce, producing a reported margin of $49.28 per ounce after AISC. Silver represented 69% of third-quarter mine revenue.

Greens Creek drives cash generation

Greens Creek in Alaska remained Hecla’s largest financial contributor, accounting for 60% of mine revenue. The operation produced 1.9 million ounces of silver and 12,000 ounces of gold, down from 2.1 million silver ounces and 14,200 gold ounces in the second quarter.

Despite the lower production, Greens Creek generated $155.1 million of operating cash flow and a site-level record of $146.8 million in free cash flow. Costs applicable to sales were $76.2 million, while cash cost and AISC were negative $10.11 and negative $3.25 per silver ounce, respectively, after by-product credits.

Hecla’s 2026 guidance for Greens Creek calls for 8.0 million to 8.3 million ounces of silver and 51,000 to 55,000 ounces of gold. Expected capital investment is $55 million to $60 million.

Lucky Friday in Idaho produced 1.3 million ounces of silver, compared with 1.5 million ounces in the prior quarter. The mine generated $88.3 million in operating cash flow and $66.8 million in free cash flow. AISC increased to $27.68 per silver ounce from $17.08, partly reflecting higher sustaining capital included in the measure.

The company expects Lucky Friday to produce 5.0 million to 5.2 million silver ounces in 2026. Its surface cooling project is scheduled for commissioning in the fourth quarter.

Keno Hill faces planned throughput restrictions

Keno Hill in Canada produced 963,000 ounces of silver, up from 600,000 ounces in the second quarter. Milled silver grade improved by more than 35% sequentially to 26.2 ounces per ton, while the operation achieved a quarterly record milling rate.

The mine generated $4.8 million in operating cash flow but recorded negative free cash flow of $2.1 million after capital investment. Hecla expects to limit Keno Hill throughput to about 300 tons per day in the fourth quarter and reduce it further from January 2027 to preserve tailings, waste-rock and water-treatment capacity.

The restrictions are expected to remain until license amendments and related infrastructure are in place. The presentation indicated that the amendments are expected around mid-2029, making permitting and infrastructure delivery important constraints on Keno Hill’s expansion. The mine’s 2026 silver production guidance is 2.3 million to 2.6 million ounces.

2026 outlook and project pipeline

Hecla’s current companywide guidance calls for 15.3 million to 16.1 million ounces of silver production in 2026. For Greens Creek and Lucky Friday combined, the company expects cash cost of negative $4.75 to negative $4.25 per ounce and AISC of $11.50 to $12.50 per ounce. Planned capital investment totals $198 million to $214 million, alongside $55 million of exploration and pre-development spending.

Over the medium term, management sees potential for annual silver production exceeding 20 million ounces. That outlook depends on Keno Hill reaching its permitted rate of 440 tons per day, a possible restart of the Midas operation in Nevada, and successful exploration, development and permitting.

At Greens Creek, Hecla is evaluating a pyrite concentrate circuit that could add an estimated 1.0 million to 1.2 million ounces of silver and 10,000 to 15,000 ounces of gold annually at full capacity. Subject to investment approval, intermittent production using temporary equipment could begin in late 2027, with the permanent circuit expected to reach full capacity in late 2028.

The company is also studying the reprocessing of about 10.7 million tons of dry-stack tailings estimated to contain 51 million ounces of silver and 600,000 ounces of gold. Hecla emphasized that the material is not classified as a mineral resource or reserve, and metallurgical test results remain pending.

The outlook remains exposed to metals-price volatility, operating and permitting risks, cost inflation, grade and recovery variability, currency movements, and political, labor, environmental and community-relations issues. Delays in licensing or infrastructure construction would also affect the timing of Keno Hill’s ramp-up and Hecla’s broader medium-term production plans.