Thursday August 04, 2016 08:53

(Kitco News) - Hecla Mining Co. (NYSE: HL) posted a net profit in the second quarter as production soared and the company also benefited from higher prices of precious metals.

Net income was $24 million, or 6 cents per share, compared to a net loss of $26.8 million, or 7 cents, for the same period in 2015, the company reported Thursday morning.

Record sales of $171.3 million were 64% higher than a year ago. Silver production of 4.2 million ounces was up 71%, while gold production of 62,965 ounces rose by 41%.

“Hecla's industry-leading production growth of 71% for silver and 41% for gold is due to our organic growth acceleration strategy,” said Phillips S. Baker, Jr., president and chief executive officer.  He later added, “With current prices even higher than the second quarter and continued strong performance from Casa Berardi and San Sebastian, we expect even better results in the future.”

The average realized silver price in the second quarter was $17.26 per ounce, 6% higher than $16.32 a year ago. The average realized gold price was $1,254 per ounce, an increase of 5% from $1,194. However, prices of lead and zinc, which are mined as a by-product, declined from the same period in 2015.

Cash costs, after by-product credits, decreased 32% per silver ounce and 28% per gold ounce from the second quarter 2015, the company said.

For full-year 2016, the company increased its production estimates at Greens Creek, San Sebastian and Casa Berardi. Hecla upped estimated 2016 company-wide silver production to 15.75 million ounces from 15 million at a cash cost, after by-product credits, of $4.75 per ounce, down from $5 previously. Gold-output guidance was upped to 233,000 ounces from 207,000.

The board of directors declared a quarterly cash dividend of $0.0025 per share of common stock payable around Aug. 31 to shareholders of record on Aug. 23. The realized silver price of $17.26 in the second quarter did not satisfy the criteria for a larger dividend under the company's policy, officials said.