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[HECLA LOGO] Exhibit 13
HECLA REPORTS FIRST QUARTER RESULTS
For the Period Ended March 31, 1996
For release: April 30, 1996
COEUR D'ALENE, Idaho -- Hecla Mining Company (HL & HL-B:NYSE) today
reported a net loss of $537,000, or 1 cent per common share, for the first
quarter of 1996, on revenue of $43.6 million. The results include $2 million in
quarterly dividend payments to holders of preferred stock. This compares to a
net loss of $4.5 million, or 9 cents per common share for the first quarter of
1995, on revenue of $37.2 million. Prior to payment of the preferred dividend,
the company realized income of $1.5 million in the first quarter of 1996,
compared to a loss of $2.5 million during the same period in 1995.
Improved results over the same quarter last year are due primarily to
increased production from the La Choya gold mine, which nearly doubled its
output, and better performance from the Grouse Creek gold mine, which was in
start-up mode during the first quarter of 1995. A higher gold price also
contributed to improved results, averaging $400 per ounce during the first
quarter of 1996, compared to $379 an ounce for the first quarter of 1995.
Arthur Brown, Hecla's chairman, president and chief executive officer, said,
"I'm pleased to see improved performance from our operations in the first
quarter, particularly with regard to our precious metals operations."
PRODUCTION
Silver production improved to 536,000 ounces during the first quarter of
1996 at an average cash cost of $4.66 per ounce. Gold production was also up
from 39,000 ounces during the first quarter of 1995 to over 47,000 ounces in the
first quarter of 1996. The average cash cost per ounce of gold during this
year's first quarter was $260, a 17% reduction from last year's first quarter
costs. The company shipped 255,038 tons of industrial minerals in the first
quarter, compared to 242,768 tons shipped in the same period of 1995.
LUCKY FRIDAY EXPANSION PROJECT
At the beginning of April, Hecla reported that initial results from new
drilling into the Lucky Friday expansion areas confirmed the existence of a
large new silver deposit adjacent to the underground workings of the mine. The
Lucky Friday silver mine is located near Mullan, Idaho, and produced 1.7 million
ounces of silver in 1995. The currently identified resource in the new deposit
is estimated to contain nearly 50 million ounces of silver. An exploration
program which will include approximately 20,000 feet of diamond drilling is
under way to further delineate the deposit. Brown said, "I'm delighted about
the latest exploration results at the Lucky Friday mine. Expansion of our
silver reserves is a key part of our plan to increase Hecla's silver production
to eight million ounces or more annually."
GREENS CREEK
Redevelopment of the Greens Creek silver/gold/zinc/lead mine on Admiralty
Island near Juneau, Alaska, is ahead of the original schedule, which called for
start-up in January 1997. Hecla owns a
Contact Bill Booth, vice president-investor and public affairs, or Vicki
Veltkamp, manager-corporate communications
6500 Mineral Drive * Coeur d'Alene, Idaho 83814-8788 * 208/769-4100
* FAX 208/769-4159
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HECLA REPORTS FIRST QUARTER RESULTS Page 2
29.7% interest in the mine in a joint venture with Kennecott Greens Creek Mining
Company. The mine closed in 1993 due to low metals prices, but the discovery of
a new, higher-grade deposit will put the mine back to work producing silver at a
cash cost of under $3.00 per ounce. Current efforts include test mining in the
ore zones and upgrading the processing facilities. Hecla expects to see Greens
Creek contribute 3 million ounces of silver as the company's share of annual
production in 1997.
On April 1, 1996, final approval was received for a land exchange with the
U.S. Forest Service granting subsurface mining rights to a large area
surrounding the Greens Creek patented claims. The exchange will increase the
acreage surrounding the mine available for exploration from 340 acres to
7,500 acres containing several significant mineral exploration targets.
GROUSE CREEK
Hecla recently announced that mining is expected to continue at the Grouse
Creek gold mine in central Idaho for at least one more year while the Sunbeam
deposit is mined out. Based on improved ore grades and a recalculation of ore
reserves in the Sunbeam pit, additional ore tonnage has been added to the mine
plan. However, an approximate two-month shutdown of milling operations and a
one-month shutdown of mining operations at Grouse Creek will be necessary in
order to enlarge the tailings impoundment, which will reach capacity earlier
than expected due to extremely heavy snowfall and spring runoff. After
resumption of operations, the mine is expected to operate through the first
quarter of 1997.
The property also consists of the adjacent Grouse deposit. Hecla is
continuing its evaluation of that deposit to determine whether it is
economically viable to mine the Grouse deposit after mining in the Sunbeam pit
is completed. A determination as to whether to develop the Grouse deposit is
expected later this year.
Operations at Grouse Creek during the first quarter produced over 18,000
ounces of gold for Hecla's account, at a cash cost of $296 per ounce. Hecla
holds an 80% interest in the property in a joint venture with Great Lakes
Minerals Inc.
OTHER METALS OPERATIONS
Hecla's La Choya gold mine in Sonora, Mexico, continued to perform well
during the first quarter. The mine produced more than 21,000 ounces of gold at
a cash cost of $175 per ounce, nearly doubling the ounces produced during the
first quarter of last year.
The American Girl gold mine in southern California turned in a
disappointing performance in the first quarter, with cash costs at approximately
$431 per ounce. Hecla holds a 47% interest in the mine through a joint venture
with MK Gold, the operator of the property. First quarter results from the Oro
Cruz ore body, which is now being mined, have been unsatisfactory. A technical
team consisting of experts from both companies has been formed to address the
problems at the property.
INDUSTRIAL MINERALS
Operating income for Hecla's industrial minerals divisions increased
slightly from the same quarter a year ago, primarily because of outstanding
performance by the kaolin and feldspar operations. Last year, Hecla acquired
the Langley, South Carolina, kaolin mine and processing plant, resulting in
Contact Bill Booth, vice president-investor and public affairs, or Vicki
Veltkamp, manager-corporate communications
6500 Mineral Drive * Coeur d'Alene, Idaho 83814-8788 * 208/769-4100
* FAX 208/769-4159
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HECLA REPORTS FIRST QUARTER RESULTS Page 3
increased sales and income from kaolin. Higher net income from feldspar and
kaolin was offset by sluggish ball clay sales in the first quarter.
EXPLORATION
Hecla has signed a letter of intent with Dakota Mining Corporation to
combine their interests in the Stibnite/Yellow Pine area in north-central Idaho.
Hecla's interest consists of a currently identified sulfide gold deposit
containing approximately 1.8 million ounces of contained gold. Dakota's
property provides additional exploration potential and the level ground
necessary for building a processing plant and the associated infrastructure
needed to support a mining plan. The gold mineralization is sulfide in nature,
which requires a different type of processing than does oxide gold
mineralization. Hecla believes there is significant potential in this district
for additional gold reserves to be discovered. The unitization of Hecla's
property at Yellow Pine with Dakota's is an important first step toward making
the resource more attractive for potential development, possibly by a third
party with appropriate expertise at processing sulfide material.
ENVIRONMENTAL
In April, Hecla was named a defendant in a lawsuit brought by the federal
government against several mining companies for alleged federal natural resource
damages caused by historic mining practices in North Idaho. Hecla and other
mining companies in the area have been working on cleanup programs for several
years, cooperating with both federal and State of Idaho agencies. Based upon
available information, Hecla does not believe the federal claims are
supportable, nor does it believe that the ultimate outcome of the litigation
will have a material adverse effect on the results of operating and financial
conditions of the company. However, the company believes the lawsuit will have
a counterproductive impact on cleanup efforts already under way.
The State of Idaho and Hecla Mining Company have recently entered into an
agreement designed to provide additional funding of ongoing cleanup initiatives
in northern Idaho's Coeur d'Alene Basin, while putting on hold any state
litigation against Hecla for any Basin-related state natural resource damages.
The agreement is intended to put additional money and manpower into the Basin
cleanup, rather than litigation. The State and Hecla will continue to seek a
negotiated agreement on a final resolution of the State's claims against Hecla.
Hecla Mining Company, headquartered in Coeur d'Alene, Idaho, is one of the
United States' best-known silver producers. The company also produces gold and
is a major supplier of ball clay, kaolin and other industrial minerals. Hecla's
operations are principally in the U.S. and Mexico.
-HL-
Hecla Mining Company news releases can be accessed on the Internet at:
http://www.hecla-mining.com
You can also request a free fax of this entire news release
from BusinessWire NewsOnDemand at 800-344-7826
Contact Bill Booth, vice president-investor and public affairs, or Vicki
Veltkamp, manager-corporate communications
6500 Mineral Drive * Coeur d'Alene, Idaho 83814-8788 * 208/769-4100
* FAX 208/769-4159
4
HECLA MINING COMPANY
(dollars in thousands, except per-share amounts - unaudited)
First Quarter Ended
-------------------------------
HIGHLIGHTS Mar. 31, 1996 Mar. 31, 1995
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FINANCIAL DATA
- ------------------------------------------------------------------------------
Total revenue $ 43,641 $ 37,153
Gross profit (loss) 3,935 (162)
Net income (loss) 1,475 (2,464)
Loss applicable to common shareholders (537) (4,476)
Loss per common share (0.01) (0.09)
Cash flow used by operating activities (365) (935)
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SALE OF PRODUCTS BY SEGMENT
- ------------------------------------------------------------------------------
Gold operations $ 19,015 $ 14,971
Silver operations 4,476 2,427
Industrial minerals 19,456 17,402
Specialty metals - - 910
--------- --------
Total sales $ 42,947 $ 35,710
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GROSS PROFIT (LOSS) BY SEGMENT
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Gold operations $ 2,189 $ (1,609)
Silver operations 108 (161)
Industrial minerals 1,638 1,604
Specialty metals - - 4
--------- --------
Total gross profit (loss) $ 3,935 $ (162)
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PRODUCTION SUMMARY - TOTALS
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Gold - Ounces 47,272 38,984
Silver - Ounces 536,000 459,395
Lead - Tons 5,577 3,649
Zinc - Tons 1,006 585
Industrial minerals - Tons shipped 255,038 242,768
Average cost per ounce of gold produced:
Cash cost ($/oz.) 260 312
Full cost ($/oz.) 353 416
Average cost per ounce of silver produced:
Cash cost ($/oz.) 4.66 4.74
Full cost ($/oz.) 5.89 6.00
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AVERAGE METAL PRICES
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Gold - Realized ($/oz.) 401 385
Gold - London Final ($/oz.) 400 379
Silver - Handy & Harman ($/oz.) 5.54 4.70
Lead - LME Cash (cents/pound) 34.7 27.7
Zinc - LME Cash (cents/pound) 47.2 48.5
Contact Bill Booth, vice president-investor and public affairs, or Vicki
Veltkamp, manager-corporate communications
6500 Mineral Drive * Coeur d'Alene, Idaho 83814-8788 * 208/769-4100
* FAX 208/769-4159
5
HECLA MINING COMPANY
Consolidated Balance Sheets
(dollars in thousands - unaudited)
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Mar. 31, 1996 Dec. 31, 1995
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ASSETS
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Current assets:
Cash and cash equivalents $ 5,018 $ 4,024
Accounts and notes receivable 34,698 25,571
Income tax refund receivable 762 737
Inventories 21,304 20,915
Other current assets 2,462 2,038
--------- ---------
Total current assets 64,244 53,285
Investments 2,260 2,200
Restricted investments 16,358 16,254
Properties, plants and equipment, net 179,474 177,374
Other noncurrent assets 9,537 9,077
--------- ---------
Total assets $ 271,873 $ 258,190
========= =========
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LIABILITIES
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Current liabilities:
Accounts payable and accrued expenses $ 15,677 $ 14,145
Accrued payroll and related benefits 2,566 3,217
Preferred stock dividends payable 2,012 2,012
Accrued taxes 1,303 1,042
Accrued reclamation costs 5,549 5,549
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Total current liabilities 27,107 25,965
Deferred income taxes 359 359
Long-term debt 25,699 36,104
Accrued reclamation costs 27,821 26,782
Other noncurrent liabilities 5,221 4,864
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Total liabilities 86,207 94,074
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SHAREHOLDERS' EQUITY
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Preferred stock 575 575
Common stock 12,798 12,079
Capital surplus 351,606 330,352
Accumulated deficit (173,743) (173,206)
Net unrealized gain on investments 214 100
Foreign currency translation adjustment (4,898) (4,898)
Treasury stock (886) (886)
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Total shareholders' equity 185,666 164,116
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Total liability and shareholders' equity $ 271,873 $ 258,190
========= =========
Common shares outstanding at end of period 51,130 48,255
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Contact Bill Booth, vice president-investor and public affairs, or Vicki
Veltkamp, manager-corporate communications
6500 Mineral Drive * Coeur d'Alene, Idaho 83814-8788 * 208/769-4100
* FAX 208/769-4159
6
HECLA MINING COMPANY
Consolidated Statements of Operations
(dollars and shares in thousands, except per-share amounts - unaudited)
First Quarter Ended
--------------------------------
Mar. 31, 1996 Mar. 31, 1995
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Sales of products $ 42,947 $ 35,710
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Cost of sales and other direct production costs 33,553 30,230
Depreciation, depletion and amortization 5,459 5,642
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39,012 35,872
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Gross profit (loss) 3,935 (162)
--------- ---------
Other operating expenses:
General and administrative 2,271 2,330
Exploration 803 1,043
Depreciation and amortization 89 83
Provision for closed operations and
environmental matters (183) 56
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2,980 3,512
--------- ---------
Income (loss) from operations 955 (3,674)
--------- ---------
Other income (expense):
Interest and other income 694 1,443
Foreign exchange loss (14) (197)
Gain on investments 20 121
Interest expense:
Total interest cost (621) (165)
Less amount capitalized 477 58
--------- ---------
556 1,260
--------- ---------
Income (loss) before income taxes 1,511 (2,414)
Income tax provision (36) (50)
--------- ---------
Net income (loss) 1,475 (2,464)
Preferred stock dividends (2,012) (2,012)
--------- ---------
Loss applicable to common shareholders $ (537) $ (4,476)
========= =========
Loss per common share $ (0.01) $ (0.09)
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Weighted average number of common
shares outstanding 51,130 48,107
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Contact Bill Booth, vice president-investor and public affairs, or Vicki
Veltkamp, manager-corporate communications
6500 Mineral Drive * Coeur d'Alene, Idaho 83814-8788 * 208/769-4100
* FAX 208/769-4159
7
HECLA MINING COMPANY
Consolidated Statements of Cash Flows
(dollars in thousands - unaudited)
First Quarter Ended
------------------------------
Mar. 31, 1996 Mar. 31, 1995
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OPERATING ACTIVITIES
- --------------------------------------------------------------------------------
Net income (loss) $ 1,475 $ (2,464)
Noncash elements included in net income (loss):
Depreciation, depletion and amortization 5,548 5,725
Loss (gain) on disposition of properties,
plants and equipment 59 (265)
Gain on investments (20) (121)
Provision for reclamation and closure costs 1,199 220
Change in:
Accounts and notes receivable (9,127) (5,029)
Income tax refund receivable (25) (2)
Inventories (389) (185)
Other current assets (424) (95)
Accounts payable and accrued expenses 1,532 (1,294)
Accrued payroll and related benefits (651) (630)
Accrued taxes 261 528
Accrued reclamation and other noncurrent
liabilities 197 2,677
-------- --------
Net cash used by operating activities (365) (935)
-------- --------
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INVESTING ACTIVITIES
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Additions to properties, plants and equipment (7,739) (6,961)
Proceeds from disposition of properties, plants
and equipment 74 314
Proceeds from the sales of investments 20 126
Increase in restricted investments (104) (48)
Purchase of investments and increase in cash
surrender value of life insurance (146) (195)
Other, net (502) (835)
-------- --------
Net cash used by investing activities (8,397) (7,599)
-------- --------
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FINANCING ACTIVITIES
- --------------------------------------------------------------------------------
Proceeds from exercise of stock warrants - - 1,208
Issuance of common stock, net of offering costs 21,973 - -
Dividends on preferred stock (2,012) (2,012)
Borrowings against cash surrender value
of life insurance 200 - -
Borrowing on long-term debt 11,500 11,000
Repayment on long-term debt (21,905) (3,884)
-------- --------
Net cash provided by financing activities 9,756 6,312
-------- --------
Net increase (decrease) in cash and cash equivalents 994 (2,222)
Cash and cash equivalents at beginning of period 4,024 7,278
-------- --------
Cash and cash equivalents at end of period $ 5,018 $ 5,056
======== ========
Contact Bill Booth, vice president-investor and public affairs, or Vicki
Veltkamp, manager-corporate communications
6500 Mineral Drive * Coeur d'Alene, Idaho 83814-8788 * 208/769-4100
* FAX 208/769-4159
8
HECLA MINING COMPANY
Production Data
First Quarter Ended
------------------------------
Mar. 31, 1996 Mar. 31, 1995
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LA CHOYA UNIT
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Tons of ore mined 1,043,070 578,435
Ore grade mined - Gold (oz./ton) 0.019 0.037
Gold produced (oz.) 21,036 11,016
Silver produced (oz.) 2,352 1,064
Average cost per ounce of gold produced:
Cash cost $175 $221
Full cost $287 $306
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AMERICAN GIRL UNIT (Reflects Hecla's 47% share)
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Tons of ore milled 31,629 19,873
Tons of ore to heap 138,963 200,266
Ore grade milled - Gold (oz./ton) 0.121 0.187
Ore grade to heap - Gold (oz./ton) 0.045 0.027
Gold produced (oz.) 6,439 5,527
Silver produced (oz.) 1,804 4,471
Average cost per ounce of gold produced:
Cash cost $431 $359
Full cost $509 $376
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GROUSE CREEK (1) (Reflects Hecla's 80% share)
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Tons of ore milled 440,883 246,161
Ore grade milled - Gold (oz./ton) 0.043 0.070
Ore grade milled - Silver (oz./ton) 0.410 0.770
Gold produced (oz.) 18,339 17,857
Silver produced (oz.) 101,220 104,950
Average cost per ounce of gold produced:
Cash cost $296 $382
Full cost $376 $552
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LUCKY FRIDAY UNIT
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Tons of ore milled 42,729 32,340
Ore grade milled - Silver (oz./ton) 10.25 10.51
Silver produced (oz.) 428,620 333,066
Lead produced (tons) 5,577 3,649
Average cost per ounce of silver produced:
Cash cost $4.66 $4.74
Full cost $5.89 $6.00
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OTHER
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Gold produced (oz.) 1,458 4,584
Silver produced (oz.) 2,004 15,844
(1)Production at the Grouse Creek Unit began during December 1994. The
ownership percentage of the Grouse Creek mine has increased to 80.13% as of
March 31, 1996, compared to 80.00% at March 31, 1995.
Contact Bill Booth, vice president-investor and public affairs, or Vicki
Veltkamp, manager-corporate communications
6500 Mineral Drive * Coeur d'Alene, Idaho 83814-8788 * 208/769-4100
* FAX 208/769-4159