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What changed in HECLA MINING CO/DE/'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of HECLA MINING CO/DE/'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+576 added−545 removedSource: 10-K (2024-02-15) vs 10-K (2023-02-17)

Top changes in HECLA MINING CO/DE/'s 2023 10-K

576 paragraphs added · 545 removed · 400 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

157 edited+35 added−33 removed236 unchanged
Biggest changePossible future laws and regulations, or more restrictive interpretations of current laws and regulations by governmental authorities, could cause additional expense, capital expenditures, restrictions on or suspensions of operations and delays in the development of new properties. 21 U.S. surface and underground mines like those at our Lucky Friday, Greens Creek and Nevada Operations are inspected at least quarterly by MSHA, which inspections often lead to notices of violation under the Mine Safety and Health Act.
Biggest changeU.S. mines like those at our Lucky Friday, Greens Creek and Nevada Operations are inspected at least quarterly by MSHA, which inspections often lead to notices of violation under the Mine Safety and Health Act. Any of our U.S. mines could be subject to a temporary or extended shutdown as a result of a violation alleged by MSHA.
These include: federal income taxes; state/provincial income taxes; county/city and bureau property taxes and sales and use tax in the U.S.; goods and services tax in Canada; value added tax in Mexico; mining-specific taxes in Alaska, Idaho, Nevada Quebec and the Yukon; and mining royalties in Alaska, Nevada and Mexico.
These include: federal income taxes; state/provincial income taxes; county/city and bureau property taxes and sales and use tax in the U.S.; goods and services tax in Canada; value added tax in Mexico; mining-specific taxes in Alaska, Idaho, Nevada, Quebec and the Yukon; and mining royalties in Alaska, Nevada and Canada.
Thus, as we transition toward renewable energy sources, we could experience a possible curtailment of our energy supply, and these new energy sources may cost more in the future than our current supplies, which could negatively our impact financial performance.
Thus, as we transition toward renewable energy sources, we could experience a possible curtailment of our energy supply, and these new energy sources may cost more in the future than our current supplies, which could negatively impact our financial performance.
These impediments include: • the classification of our board of directors into three classes serving staggered three-year terms, which makes it more difficult to quickly replace board members; • the ability of our board of directors to issue shares of preferred stock with rights as it deems appropriate without stockholder approval; • a provision that special meetings of our board of directors may be called only by our chief executive officer or a majority of our board of directors; • a provision that special meetings of stockholders may only be called pursuant to a resolution approved by a majority of our board of directors; • a prohibition against action by written consent of our stockholders; 28 • a provision that our board members may only be removed for cause and by an affirmative vote of at least 80% of the outstanding voting stock; • a provision that our stockholders comply with advance-notice provisions to bring director nominations or other matters before meetings of our stockholders; • a prohibition against certain business combinations with an acquirer of 15% or more of our common stock for three years after such acquisition unless the stock acquisition or the business combination is approved by our board prior to the acquisition of the 15% interest, or after such acquisition our board and the holders of two-thirds of the other common stock approve the business combination; and • a prohibition against our entering into certain business combinations with interested stockholders without the affirmative vote of the holders of at least 80% of the voting power of the then outstanding shares of voting stock.
These impediments include: • the classification of our board of directors into three classes serving staggered three-year terms, which makes it more difficult to quickly replace board members; • the ability of our board of directors to issue shares of preferred stock with rights as it deems appropriate without stockholder approval; • a provision that special meetings of our board of directors may be called only by our chief executive officer or a majority of our board of directors; • a provision that special meetings of stockholders may only be called pursuant to a resolution approved by a majority of our board of directors; • a prohibition against action by written consent of our stockholders; • a provision that our board members may only be removed for cause and by an affirmative vote of at least 80% of the outstanding voting stock; • a provision that our stockholders comply with advance-notice provisions to bring director nominations or other matters before meetings of our stockholders; • a prohibition against certain business combinations with an acquirer of 15% or more of our common stock for three years after such acquisition unless the stock acquisition or the business combination is approved by our board prior to the acquisition of the 15% interest, or after such acquisition our board and the holders of two-thirds of the other common stock approve the business combination; and • a prohibition against our entering into certain business combinations with interested stockholders without the affirmative vote of the holders of at least 80% of the voting power of the then outstanding shares of voting stock.
Because we conduct operations internationally, we are subject to political, social, legal and economic risks such as: • the effects of local political, labor and economic developments and unrest; • significant or abrupt changes in the applicable regulatory or legal climate; • significant changes to regulations or laws or the interpretation or enforcement of them; • exchange controls and export restrictions; • expropriation or nationalization of assets with inadequate compensation; • unfavorable currency fluctuations, particularly in the exchange rate between the U.S. dollar and the Canadian dollar and Mexican Peso; • repatriation restrictions; • invalidation and unavailability of governmental orders, permits or agreements; • property ownership disputes; • renegotiation or nullification of existing concessions, licenses, permits and contracts; • criminal activity, corruption, demands for improper payments, expropriation, and uncertain legal enforcement and physical security; • failure to maintain compliance with corruption and transparency statutes, including the U.S.
Because we conduct operations internationally, we are subject to political, social, legal and economic risks such as: • the effects of local political, labor and economic developments and unrest; • significant or abrupt changes in the applicable regulatory or legal climate; • significant changes to regulations or laws or the interpretation or enforcement of them; • exchange controls and export restrictions; • expropriation or nationalization of assets with inadequate compensation; • unfavorable currency fluctuations, particularly in the exchange rate between the U.S. dollar and the Canadian dollar and Mexican Peso; • repatriation restrictions; • invalidation and unavailability of governmental orders, permits or agreements; • property ownership disputes; 18 • renegotiation or nullification of existing concessions, licenses, permits and contracts; • criminal activity, corruption, demands for improper payments, expropriation, and uncertain legal enforcement and physical security; • failure to maintain compliance with corruption and transparency statutes, including the U.S.
The market price for our stock has been volatile, often based on: • changes in metals prices, particularly silver and gold; • our results of operations and financial condition as reflected in our public news releases or periodic filings with the SEC; • fluctuating proven and probable reserves; • factors unrelated to our financial performance or future prospects, such as global economic developments, market perceptions of the attractiveness of particular industries, or the reliability of metals markets; • market prices of our publicly traded debt; • political and regulatory risk; • the success of our exploration, pre-development, and capital programs; • ability to meet production estimates; • environmental, safety and legal risk; • ability to defend against cyber security attacks; • the extent and nature of analytical coverage concerning our business; and 27 • the trading volume and general market interest in our securities.
The market price for our stock has been volatile, often based on: • changes in metals prices, particularly silver and gold; • our results of operations and financial condition as reflected in our public news releases or periodic filings with the SEC; • fluctuating proven and probable reserves; • factors unrelated to our financial performance or future prospects, such as global economic developments, market perceptions of the attractiveness of particular industries, or the reliability of metals markets; • market prices of our publicly traded debt; • political and regulatory risk; • the success of our exploration, pre-development, and capital programs; • ability to meet production estimates; • environmental, safety and legal risk; • ability to defend against cyber security attacks; • the extent and nature of analytical coverage concerning our business; and • the trading volume and general market interest in our securities.
These covenants, among other things: • make it more difficult for us to satisfy our obligations with respect to the Senior Notes and our other debt; • limit our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements, or require us to make divestiture; • require a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, acquisitions and other general corporate purposes; • increase our vulnerability to general adverse economic and industry conditions; • limit our flexibility in planning for and reacting to changes in the industry in which we compete; • place us at a disadvantage compared to other, less leveraged competitors; and • increase our cost of borrowing additional funds.
These covenants, among other things: 29 • make it more difficult for us to satisfy our obligations with respect to the Senior Notes and our other debt; • limit our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements, or require us to make divestiture; • require a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, acquisitions and other general corporate purposes; • increase our vulnerability to general adverse economic and industry conditions; • limit our flexibility in planning for and reacting to changes in the industry in which we compete; • place us at a disadvantage compared to other, less leveraged competitors; and • increase our cost of borrowing additional funds.
Potential key material physical risks to Hecla from climate change include, but are not limited to: • Increased volumes of mine contact water requiring storage and treatment; • Increased design requirements for stormwater diversion and associated water management systems; • Reduced freshwater availability due to potential drought conditions; • Damage to roads and other infrastructure at our sites due to extreme weather events including intense rainfalls and related events such as landslides; and • Unpermitted or otherwise non-compliant discharge of wastewater due to an increased frequency of extreme weather events exceeding the design capacity of existing tailings storage facilities and other stormwater management infrastructure.
Potential key material physical risks to Hecla from climate change include, but are not limited to: • increased volumes of mine contact water requiring storage and treatment; • increased design requirements for stormwater diversion and associated water management systems; 13 • reduced freshwater availability due to potential drought conditions; • damage to roads and other infrastructure at our sites due to extreme weather events including intense rainfalls and related events such as landslides; and • unpermitted or otherwise non-compliant discharge of wastewater due to an increased frequency of extreme weather events exceeding the design capacity of existing tailings storage facilities and other stormwater management infrastructure.
This determination is based on estimates of several factors, including: • mineral reserves and resources; 15 • expected ore grades and recovery rates of metals from the ore; • future metals prices; • facility and equipment costs; • availability of adequate staffing; • availability of affordable sources of power and adequacy of water supply; • exploration and drilling success; • capital and operating costs of a development project; • environmental and closure, permitting and other regulatory considerations and costs; • adequate access to the site, including competing land uses (such as agriculture); • applicable tax rates; • foreign currency fluctuation and inflation rates; and • availability and cost of financing.
This determination is based on estimates of several factors, including: • mineral reserves and resources; • expected ore grades and recovery rates of metals from the ore; • future metals prices; • facility and equipment costs; • availability of adequate staffing; • availability of affordable sources of power and adequacy of water supply; • exploration and drilling success; • capital and operating costs of a development project; • environmental and closure, permitting and other regulatory considerations and costs; • adequate access to the site, including competing land uses (such as agriculture); • applicable tax rates; • foreign currency fluctuation and inflation rates; and • availability and cost of financing.
See the risk factors below, “ Our existing stockholders are effectively subordinated to the holders of our Senior Notes", “ Any downgrade in the credit ratings assigned to us or our debt securities could increase future borrowing costs, adversely affect the availability of new financing and may result in increased collateral requirements under our existing surety bond portfolio ,” and “ Mine closure and reclamation regulations impose substantial costs on our operations, and include requirements that we provide financial assurance supporting those obligations.
See the risk factors below, “ Our existing stockholders are effectively subordinated to the holders of our Senior Notes", “ Any downgrade in the credit ratings 25 assigned to us or our debt securities could increase future borrowing costs, adversely affect the availability of new financing and may result in increased collateral requirements under our existing surety bond portfolio ,” and “ Mine closure and reclamation regulations impose substantial costs on our operations, and include requirements that we provide financial assurance supporting those obligations.
We may not realize all (or any) of the anticipated benefits from any acquisition, such as increased earnings, cost savings and revenue enhancements, for various reasons, including difficulties integrating operations and personnel, higher than expected acquisition and operating costs or other difficulties, unknown liabilities which may be significant, inaccurate reserve estimates, unrealized 20 exploration targets, ore grades or mill recoveries that are lower than required for portions of the orebodies to be economic, and fluctuations in market prices.
We may not realize all (or any) of the anticipated benefits from any acquisition, such as increased earnings, cost savings and revenue enhancements, for various reasons, including difficulties integrating operations and personnel, higher than expected acquisition and operating costs or other difficulties, unknown liabilities which may be significant, inaccurate reserve estimates, unrealized exploration targets, ore grades or mill recoveries that are lower than required for portions of the orebodies to be economic, and fluctuations in market prices.
Risk Factors – Our accounting and other estimates may be imprecise ; Our ability to recognize the benefits of deferred tax assets related to net operating loss carryforwards and other items is dependent on future cash flows and taxable income ; Our foreign activities are subject to additional inherent risks ; and We face substantial governmental regulation, including the Mine Safety and Health Act, various environmental laws and regulations and the 1872 Mining Law .
Risk Factors – Our accounting and other estimates may be imprecise ; Our ability to recognize the benefits of deferred tax assets related to net operating loss carryforwards and other items is dependent on future cash flows generating taxable income ; Our foreign activities are subject to additional inherent risks ; and We face substantial governmental regulation, including the Mine Safety and Health Act, various environmental laws and regulations and the 1872 Mining Law .
During that time, it may become no longer feasible to produce those minerals for economic, regulatory, political or other reasons. As a result of high costs and other uncertainties, we may not be able to expand or replace our existing mineral reserves as they are depleted, which would adversely affect our business and financial position in the future.
During that time, it may become no longer feasible to produce those 17 minerals for economic, regulatory, political or other reasons. As a result of high costs and other uncertainties, we may not be able to expand or replace our existing mineral reserves as they are depleted, which would adversely affect our business and financial position in the future.
We cannot assure you that we will not experience net losses in the future. Our accounting and other estimates may be imprecise. Preparing consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts and related disclosure of assets, liabilities, revenue and expenses at the date of the consolidated financial statements and reporting periods.
We cannot assure you that we will not experience net losses in the future. 11 Our accounting and other estimates may be imprecise. Preparing consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts and related disclosure of assets, liabilities, revenue and expenses at the date of the consolidated financial statements and reporting periods.
If new debt is added to our and our subsidiaries’ existing debt levels, the risks associated with such debt that we currently face would increase. In addition, the indenture governing the Senior Notes does not prevent us from incurring additional indebtedness under the indenture. 10 We have had losses that could reoccur in the future.
If new debt is added to our and our subsidiaries’ existing debt levels, the risks associated with such debt that we currently face would increase. In addition, the indenture governing the Senior Notes does not prevent us from incurring additional indebtedness under the indenture. We have had losses that could reoccur in the future.
We will provide copies of these materials to stockholders upon request using the above-listed contact information, directed to the attention of Investor Relations, or via e-mail request sent to hmc-info@hecla.com . We routinely post important information for on our web site, www.hecla.com, in the “Investors” section.
We will provide copies of these materials to stockholders upon request using the above-listed contact information, directed to the attention of Investor Relations, or via e-mail request sent to hmc-info@hecla.com . We routinely post important information for investors on our web site, www.hecla.com, in the “Investors” section.
In addition, we may be required to, or may voluntarily, enter into certain agreements with such tribal communities in order to facilitate development of our properties, which could reduce the expected earnings or income from any future production. We may be subject to a number of unanticipated risks related to inadequate infrastructure.
In addition, we may be required to, or may voluntarily, enter into certain agreements with such tribal communities in order to facilitate development of our properties, which could reduce the expected earnings or income from any future production. 19 We may be subject to a number of unanticipated risks related to inadequate infrastructure.
While both a salmon initiative in Alaska and a water treatment initiative in 25 Montana were defeated by voters in November 2018, in the future similar or other initiatives that could impact our operations may be on the ballot in these states or other jurisdictions (including local or international) in which we currently or may in the future operate.
While both a salmon initiative in Alaska and a water treatment initiative in Montana were defeated by voters in November 2018, in the future similar or other initiatives that could impact our operations may be on the ballot in these states or other jurisdictions (including local or international) in which we currently or may in the future operate.
Our properties in Canada may be of particular interest or sensitivity to one or more interest groups, including aboriginal groups (which are generally referred to as “First Nations”). We have mineral projects in Quebec, the Yukon and British Columbia that are or 18 may be in areas with a First Nations presence.
Our properties in Canada may be of particular interest or sensitivity to one or more interest groups, including aboriginal groups (which are generally referred to as “First Nations”). We have mineral projects in Quebec, the Yukon and British Columbia that are or may be in areas with a First Nations presence.
Our goal is to achieve world-class safety and health performance by promoting a deeply rooted value-based culture of safety and utilizing technology and innovation to continually improve the safety at our operations. We know that employees' and contractors' safety awareness is fundamental to making our workplace as 7 safe as possible.
Our goal is to achieve world-class safety and health performance by promoting a deeply rooted value-based culture of safety and utilizing technology and innovation to continually improve the safety at our operations. We know that employees' and contractors' safety awareness is fundamental to making our workplace as safe as possible.
See the risk factor above, “ We are required to obtain governmental permits and other approvals in order to conduct mining operations ” and the risk factor below, “ Mine closure and reclamation regulations impose substantial costs on our operations, and include requirements that we provide financial 22 assurance supporting those obligations.
See the risk factor above, “ We are required to obtain governmental permits and other approvals in order to conduct mining operations ” and the risk factor below, “ Mine closure and reclamation regulations impose substantial costs on our operations, and include requirements that we provide financial assurance supporting those obligations.
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations , Note 2 of Notes to Consolidated Financial Statements, and the risk factors set forth below: “ Our costs of extending existing reserves or development of new orebodies and other capital costs may be higher and provide less return than we estimated, ” “ Our ore reserve and resource estimates may be imprecise, ” “ We are currently involved in ongoing legal disputes that may materially adversely affect us, ” and “ Our environmental and asset retirement obligations may exceed the provisions we have made. ” Commodity and currency risk management activities could prevent us from realizing possible revenues or lower costs or expose us to losses.
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations , Note 2 of Notes to Consolidated Financial Statements, and the risk factors set forth below: “ Our costs of extending existing reserves or development of new orebodies and other capital costs may be higher and provide less return than we estimated, ” “ Our mineral reserve and resource estimates may be imprecise, ” “ We are currently involved in ongoing legal disputes that may materially adversely affect us, ” and “ Our environmental and asset retirement obligations may exceed the provisions we have made. ” Commodity and currency risk management activities could prevent us from realizing possible revenues or lower costs or expose us to losses.
Such risks could result in: • personal injury or fatalities; • damage to or destruction of mineral properties or producing facilities; • environmental damage and financial penalties; • delays in exploration, development or mining; • monetary losses; • inability to meet our financial obligations; • asset impairment charges; • legal liability; and • temporary or permanent closure of facilities.
Such risks could result in: • personal injury or fatalities; • damage to or destruction of mineral properties or producing facilities; • environmental damage and financial penalties; • delays in exploration, development or mining; 15 • monetary losses; • inability to meet our financial obligations; • asset impairment charges; • legal liability; and • temporary or permanent closure of facilities.
Such write-downs may adversely affect our results of operations and financial condition. We review our long-lived assets for recoverability pursuant to the Financial Accounting Standard Board’s Accounting Standards Codification Section 360. Under that standard, we review the recoverability of our long-lived assets, such as our mining properties, upon a triggering event.
Such write-downs may adversely affect our results of operations and financial condition. 20 We review our long-lived assets for recoverability pursuant to the Financial Accounting Standard Board’s Accounting Standards Codification Section 360. Under that standard, we review the recoverability of our long-lived assets, such as our mining properties, upon a triggering event.
Tariffs, other potential changes to tariff and import/export regulations, and ongoing trade disputes between the United States and other jurisdictions may have a negative effect on global economic conditions and our business, financial results and financial condition. In 2018, the United States imposed and enacted tariffs on certain items.
Tariffs, other potential changes to tariff and import/export regulations, and ongoing trade disputes between the United States and other jurisdictions may have a negative effect on global economic conditions and our business, financial results and financial condition. 30 In 2018, the United States imposed and enacted tariffs on certain items.
Many of the factors affecting our operating results are beyond our control, including, but not limited to, the volatility of metals prices; smelter terms; rock and soil conditions; seismic events; cybersecurity attacks; availability of hydroelectric power; diesel fuel prices; interest rates; foreign exchange rates; global or regional political or economic policies; inflation; availability and cost of labor; economic developments and crises; governmental regulations; continuity of orebodies; ore grades; recoveries; performance of equipment; price speculation by certain investors; and purchases and sales by central banks and other holders and producers of gold and silver in response to these factors.
Many of the factors affecting our operating results are beyond our control, including, but not limited to, the volatility of metals prices; smelter terms; rock and soil conditions; seismic events; cybersecurity attacks; availability of hydroelectric power; diesel fuel prices; interest rates; foreign exchange rates; global or regional political or economic policies; inflation; availability and cost of labor; economic developments and crises; governmental regulations; continuity of orebodies; ore grades; recoveries; performance of equipment; uninsured losses; price speculation by certain investors; and purchases and sales by central banks and other holders and producers of gold and silver in response to these factors.
In July 2022, we entered into our $150 million senior credit facility (with the option to increase to $225 million). Like the indenture, the credit agreement governing the revolving credit facility also has restrictions on the incurrence of additional indebtedness but with a number of significant qualifications and exceptions.
In July 2022, we entered into our $150 million revolving credit facility (with the option to increase to $225 million). Like the indenture, the credit agreement governing the revolving credit facility also has restrictions on the incurrence of additional indebtedness but with a number of significant qualifications and exceptions.
Therefore, we invest in training and workforce development programs that focus on safety first. All employees receive training that complies with or exceeds the applicable safety and health regulations as set by the governing body in the jurisdiction in which each operation is located.
Therefore, we invest in training and workforce development programs that focus on safety first. All employees and contractors receive training that complies with or exceeds the applicable safety and health regulations as set by the governing body in the jurisdiction in which each operation is located.
See the risk factor below, “Legal challenges could prevent our projects in Montana from ever being developed.” We cannot assure you that we will at all times be in compliance with applicable laws, regulations and permitting requirements.
See the risk factor below, “Legal challenges could prevent our projects in Montana from ever being developed.” 22 We cannot assure you that we will at all times be in compliance with applicable laws, regulations and permitting requirements.
Our level of debt and our debt service obligations may have adverse effects on our business, financial condition, cash flows or results of operations, including: • making it more difficult for us to satisfy our obligations with respect to the Senior Notes; • reducing the amount of funds available to finance our operations, capital expenditures and other activities; • increasing our vulnerability to economic downturns and industry conditions; • limiting our flexibility in responding to changing business and economic conditions; • jeopardizing our ability to execute our business plans; • placing us at a disadvantage when compared to our competitors that have less debt; • increasing our cost of borrowing; and • limiting our ability to borrow additional funds.
Our level of debt, debt service obligations and covenant requirements may have adverse effects on our business, financial condition, cash flows or results of operations, including: • making it more difficult for us to satisfy our obligations with respect to the Senior Notes; • reducing the amount of funds available to finance our operations, capital expenditures and other activities; • increasing our vulnerability to economic downturns and industry conditions; • limiting our flexibility in responding to changing business and economic conditions; • jeopardizing our ability to execute our business plans; • placing us at a disadvantage when compared to our competitors that have less debt; • increasing our cost of borrowing; and • limiting our ability to borrow additional funds.
In addition, any amendments to our Code of Ethics or waivers granted to our directors and executive officers will be posted on our website. Each of these documents may be periodically revised, so you are encouraged to visit our website for any updated terms.
In addition, any amendments 9 to our Code of Ethics or waivers granted to our directors and executive officers will be posted on our website. Each of these documents may be periodically revised, so you are encouraged to visit our website for any updated terms.
However, we anticipate incurring care-and-maintenance costs in the future unless and until we have enough exploration success and development to resume mining operations. In September 2022, we completed the acquisition of Alexco and gained ownership of the Keno Hill project in the Yukon, Canada.
However, we anticipate incurring care-and-maintenance costs in the future unless and until we have enough exploration success and development to resume mining operations. In September 2022, we completed the acquisition of Alexco and gained ownership of the Keno Hill project in the Yukon Territory, Canada.
The market price of our common stock could decline if certain large holders of our common stock, or recipients of our 31 common stock, sell all or a significant portion of their shares of common stock or are perceived by the market as intending to sell these shares other than in an orderly manner.
The market price of our common stock could decline if certain large holders of our common stock, or recipients of our common stock, sell all or a significant portion of their shares of common stock or are perceived by the market as intending to sell these shares other than in an orderly manner.
Compliance with environmental regulations, and litigation based on such regulations, involves significant costs and can threaten existing operations or constrain expansion opportunities ” and “ We are required to obtain governmental permits and other approvals in order to conduct mining operations .” We are required to obtain governmental permits and other approvals in order to conduct mining operations.
Compliance with environmental regulations, and litigation based on such regulations, involves significant costs and can threaten existing operations or constrain expansion opportunities ” and “ We are required to obtain governmental permits and other approvals in order to conduct mining operations .” 24 We are required to obtain governmental permits and other approvals in order to conduct mining operations.
The more significant areas requiring the use of management assumptions and estimates relate to: • mineral reserves, resources, and exploration targets that are the basis for future income and cash flow estimates and units-of-production depreciation, depletion and amortization calculations; • future ore grades, throughput and recoveries; • future metals prices; • future capital and operating costs; • environmental, reclamation and closure obligations; • permitting and other regulatory considerations; • asset impairments; • valuation of business combinations; • future foreign exchange rates, inflation rates and applicable tax rates; • reserves for contingencies and litigation; and • deferred tax asset valuation allowance.
The more significant areas requiring the use of management assumptions and estimates relate to: • mineral reserves, resources, and exploration targets that are the basis for future income and cash flow estimates and units-of-production depreciation, depletion and amortization calculations; • future ore grades, throughput and recoveries; • future metals prices; • future capital and operating costs; • environmental, reclamation and closure obligations; • permitting and other regulatory considerations; • asset impairments; • valuation of business combinations; • insurance proceeds; • future foreign exchange rates, inflation rates and applicable tax rates; • reserves for contingencies and litigation; and • deferred tax asset valuation allowance.
Risk Factors – We face substantial governmental regulation, including the Mine Safety and Health Act, various environmental laws and regulations and the 1872 Mining Law . Environmental Our operations are subject to various environmental laws and regulations at the federal and state/provincial level.
Risk Factors – We face substantial governmental regulation, including the Mine Safety and Health Act, various environmental laws and regulations and the 1872 Mining Law . 6 Environmental Our operations are subject to various environmental laws and regulations at the federal and state/provincial level.
If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and 29 our net income and cash flows, including cash available for servicing our indebtedness, would correspondingly decrease.
If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our indebtedness, would correspondingly decrease.
In addition, we are exposed 11 to credit risk with our counterparties, and we may experience losses if a counterparty fails to purchase under a contract when the contract price exceeds the spot price of a commodity.
In addition, we are exposed to credit risk with our counterparties, and we may experience losses if a counterparty fails to purchase under a contract when the contract price exceeds the spot price of a commodity.
See the risk factors above, “ We may not realize all of the anticipated benefits from our acquisitions, including our recent acquisition of Alexco ” and “ An extended decline in metals prices, an increase in operating or capital costs or treatment charges, mine accidents or closures, increasing regulatory obligations, or our inability to convert resources or exploration targets to reserves may cause us to record write-downs, which could negatively impact our results of operations .” We face risks relating to transporting our products from our mines, as well as transporting employees and materials at our Greens Creek, Casa Berardi and Keno Hill sites.
See the risk factors above, “ We may not realize all of the anticipated benefits from our acquisitions, including our 2022 acquisition of Alexco ” and “ An extended decline in metals prices, an increase in operating or capital costs or treatment charges, mine accidents or closures, increasing regulatory obligations, or our inability to convert resources or exploration targets to reserves may cause us to record write-downs, which could negatively impact our results of operations .” 21 We face risks relating to transporting our products from our mines, as well as transporting employees and materials at our Greens Creek, Casa Berardi and Keno Hill sites.
If smelters or refiners are unavailable or unwilling to accept our products, or we are otherwise unable to sell our products to customers on acceptable commercial and legal terms, our operations and financial results could be adversely affected. See Note 3 of Notes to Consolidated Financial Statements for more information on the distribution of our sales and our significant customers.
If smelters or refiners are unavailable or unwilling to accept our products, or we are otherwise unable to sell our products to customers on acceptable commercial and legal terms, our operations and financial results could be adversely affected. See Note 4 of Notes to Consolidated Financial Statements for more information on the distribution of our sales and our significant customers.
Adverse outcomes in lawsuits challenging permits or failure to comply with applicable regulations or permits could result in the suspension, denial, or revocation of required permits, or the imposition of penalties, any of which could have a material adverse impact on our cash flows, results of operations, or financial condition. See Note 14 of Notes to Consolidated Financial Statements .
Adverse outcomes in lawsuits challenging permits or failure to comply with applicable regulations or permits could result in the suspension, denial, or revocation of required permits, or the imposition of penalties, any of which could have a material adverse impact on our cash flows, results of operations, or financial condition. See Note 16 of Notes to Consolidated Financial Statements .
Metals price, reserve, production and cost estimates are key components to determine the expected future benefit of our deferred tax assets. To the extent that future taxable income differs significantly from estimates as a result of a decline in metals prices or other factors, our ability to realize the deferred tax assets could be impacted.
Metal prices, reserve, production and cost estimates are key components to determine the expected future benefit of our deferred tax assets. To the extent that future taxable income differs significantly from estimates as a result of a decline in metals prices or other factors, our ability to realize the deferred tax assets could be impacted.
We compete with other companies both in and outside the mining industry in recruiting and retaining qualified employees and contractors 30 knowledgeable about the mining business.
We compete with other companies both in and outside the mining industry in recruiting and retaining qualified employees and contractors knowledgeable about the mining business.
However, private conservation groups have taken and may in the future take actions to oppose or delay activities at Montanore. On May 30, 2017, the Montana Federal District Court issued Opinions and Orders in three lawsuits challenging previously granted environmental approvals for the Montanore project.
However, private conservation groups have taken and may in the future take actions to oppose or delay activities at Montanore. On May 30, 2017, the Montana Federal District Court issued Opinions and Orders in three lawsuits challenging previously granted environmental approvals for the Libby Exploration project.
Also, s ee Note 6 of Notes to Consolidated Financial Statements for more information on income and mining taxes. Physical Assets Our business is capital intensive and requires ongoing capital investment for the replacement, modernization and expansion of equipment and facilities and to develop new mineral reserves.
Also, s ee Note 7 of Notes to Consolidated Financial Statements for more information on income and mining taxes. Physical Assets Our business is capital intensive and requires ongoing capital investment for the replacement, modernization and expansion of equipment and facilities and to develop new mineral reserves.
A sustained period of low returns or losses on investments, or future benefit obligations that exceed our estimates, could require us to fund the pension plans to a greater extent than anticipated. See Note 5 of Notes to Consolidated Financial Statements for more information on our pension plans.
A sustained period of low returns or losses on investments, or future benefit obligations that exceed our estimates, could require us to fund the pension plans to a greater extent than anticipated. See Note 6 of Notes to Consolidated Financial Statements for more information on our pension plans.
As a result of the legal challenges and other circumstances related to our Montana projects, we are now focused on obtaining the permits necessary to conduct underground exploration and evaluation activities at the Montanore site and are not currently engaged in permitting activities for Rock Creek.
As a result of the legal challenges and other circumstances related to our Montana projects, we are now focused on obtaining the permits necessary to conduct underground exploration and evaluation activities at the Libby Exploration site and are not currently engaged in permitting activities for Rock Creek.
As a result, in future periods we could face another triggering event which could lead to an impairment charge, and any such impairment charge could be material. We may not realize all of the anticipated benefits from our acquisitions, including our recent acquisition of Alexco.
As a result, in future periods we could face another triggering event which could lead to an impairment charge, and any such impairment charge could be material. We may not realize all of the anticipated benefits from our acquisitions, including our 2022 acquisition of Alexco.
Item 1. Business For information regarding the organization of our business segments and our significant customers, see Note 3 of Notes to Consolidated Financial Statements. Information set forth in Items 1A and 2 below are incorporated by reference into this Item 1.
Item 1. Business For information regarding the organization of our business segments and our significant customers, see Note 4 of Notes to Consolidated Financial Statements. Information set forth in Items 1A and 2 below are incorporated by reference into this Item 1.
We determined the continued suspension of production in Nevada and reduced 2023 budgeted exploration program represented a triggering event requiring an assessment of recoverability of the carrying value of our long-lived assets in Nevada. We also identified a triggering event for Casa Berardi in 2022.
We determined the continued suspension of production in Nevada and reduced 2024 budgeted exploration program represented a triggering event requiring an assessment of recoverability of the carrying value of our long-lived assets in Nevada. We also identified a triggering event for Casa Berardi in 2023.
For a description of some of the lawsuits and other claims in which we are involved, see Note 14 of Notes to Consolidated Financial Statements . Our environmental and asset retirement obligations may exceed the provisions we have made. We are subject to significant environmental obligations.
For a description of some of the lawsuits and other claims in which we are involved, see Note 16 of Notes to Consolidated Financial Statements . Our environmental and asset retirement obligations may exceed the provisions we have made. We are subject to significant environmental obligations.
Among other provisions, the Code of Conduct reflects that it is our policy and practice not to discriminate against any employee because of race, color, religion, national origin, sex, sexual orientation, gender identity or expression, age, or physical or other disability. We expect our leaders to set the example by being positive role models and good mentors for our employees.
Among other provisions, the Code of Conduct reflects our policy and practice not to discriminate against any employee because of race, color, religion, national origin, sex, sexual orientation, gender identity or expression, age, or physical or other disability. We expect our leaders to set the example by being positive role models and good mentors for our employees.
Accordingly, it is possible that our permitting activities, production, exploration or development activities on our Canadian properties could be delayed, interrupted or otherwise adversely affected in the future by political uncertainty, native land claims entitlements, expropriations of property, changes in applicable law, governmental policies and policies of relevant interest groups, including those of First Nations.
Accordingly, it is possible that our permitting activities, profitable production, exploration or development activities on our Canadian properties could be delayed, interrupted or otherwise adversely affected in the future by political uncertainty, native land claims entitlements, expropriations of property, financial arrangements, changes in applicable law, governmental policies and policies of relevant interest groups, including those of First Nations.
Returns, if any, on investments are subject to fluctuations based on investment choices and market conditions. In addition, we have a supplemental excess retirement plan which was funded as of December 31, 2022.
Returns, if any, on investments are subject to fluctuations based on investment choices and market conditions. In addition, we have a supplemental excess retirement plan which was funded as of December 31, 2023.
Policy and regulatory risk related to actual and proposed changes in climate- and water-related laws, regulations and taxes developed to regulate the transition to a low-carbon economy may result in increased costs for our operations, our smelters and refiners and our suppliers, including increased energy, capital equipment, environmental monitoring and reporting and other costs to comply 13 with such regulations.
Policy and regulatory risk related to actual and proposed changes in climate and water-related laws, regulations and taxes developed to regulate the transition to a low-carbon economy may result in increased costs for our operations, third-party smelters and refiners and our suppliers, including increased energy, capital equipment, environmental monitoring and reporting and other costs to comply with such regulations.
At December 31, 2022, the book value of our properties, plants, equipment and mineral interests, net of accumulated depreciation, was approximately $2.6 billion. For more information see Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. We maintain insurance policies against property loss and business interruption.
At December 31, 2023, the book value of our properties, plants, equipment and mineral interests, net of accumulated depreciation, was approximately $2.7 billion. For more information see Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. We maintain insurance policies against property loss and business interruption.
Acquisitions of other mining companies or properties may also expose us to new legal, geographic, political, operating, and geological risks. See the risk factor below, “ We may not realize all of the anticipated benefits from our acquisitions, including our recent acquisition of Alexco. ” 19 We may be unable to successfully integrate the operations of the properties we acquire.
Acquisitions of other mining companies or properties may also expose us to new legal, geographic, political, operating, and geological risks. See the risk factor below, “ We may not realize all of the anticipated benefits from our acquisitions, including our 2022 acquisition of Alexco. ” We may be unable to successfully integrate the operations of the properties we acquire.
In addition, our operations and exploration activities at Casa Berardi and San Sebastian are conducted pursuant to claims or concessions granted by the host government, and otherwise are subject to claims renewal and minimum work commitment requirements, which are subject to certain political risks associated with foreign operations. See Item 1A.
In addition, our operations and exploration activities at Keno Hill and the Yukon, Casa Berardi and San Sebastian are conducted pursuant to claims or concessions granted by the host government, and otherwise are subject to claims renewal and minimum work commitment requirements, which are subject to certain political risks associated with foreign operations. See Item 1A.
In 2022, our subsidiary withdrew the Plan of Operations for Montanore from USFS consideration and submitted a new Plan of Operations proposing only underground exploration and evaluation activities at the site. In conjunction with this narrower scope of activity, the USFS withdrew its previously issued Supplemental Environmental Impact Statement (“SEIS”).
In 2022, our subsidiary withdrew the Plan of Operations for the Libby Exploration project from USFS consideration and submitted a new Plan of Operations proposing only underground exploration and evaluation activities at the site. In conjunction with this narrower scope of activity, the USFS withdrew its previously issued Supplemental Environmental Impact Statement (“SEIS”).
In recent years there have been several proposed or implemented ballot initiatives that sought to directly or indirectly curtail or eliminate mining in certain states, including Alaska, where our Greens Creek mine operates, and Montana, where we are seeking to explore at the site of the past Montanore project, and possibly develop depending on the results of exploration activities, and may in the future seek to explore or develop the Rock Creek project.
In recent years there have been several proposed or implemented ballot initiatives that sought to directly or indirectly curtail or eliminate mining in certain states, including Alaska, where our Greens Creek mine operates, and Montana, where we are seeking to explore at the Libby Exploration project, and possibly develop depending on the results of exploration activities, and may in the future seek to explore or develop the Rock Creek project.
We discover, acquire and develop mines and other mineral interests and produce and market (i) concentrates containing silver, gold, lead and zinc, (ii) carbon material containing silver and gold, and (iii) unrefined doré containing silver and gold. In doing so, we intend to manage our business activities in a safe, environmentally responsible and cost-effective manner.
We discover, acquire and develop mines and other mineral interests and produce and market (i) concentrates containing silver, gold and other metals, (ii) carbon material containing silver and gold, and (iii) unrefined doré containing silver and gold. In doing so, we intend to manage our business activities in a safe, environmentally responsible and cost-effective manner.
Our estimates of undiscounted cash flows for our long-lived assets also include an estimate of the market value of the resources and exploration targets beyond the current operating plans. We determined no impairments were required for triggering events identified during 2022.
Our estimates of undiscounted cash flows for our long-lived assets also include an estimate of the market value of the resources and exploration targets beyond the current operating plans. 10 We determined no impairments were required for triggering events identified during 2023.
These factors are largely beyond our control and are difficult to predict. If the market prices for these metals fall below our production or development costs for a sustained period of time, we will experience losses and may have to discontinue exploration, development or operations, or incur asset write-downs at one or more of our properties. See Item 1.
These factors are largely beyond our control and are difficult to predict. If the market prices for these metals fall below our production or development costs for a sustained period of time, we will experience losses and may have to discontinue exploration, development or operations, and we may also incur asset write-downs at one or more of our properties.
For more discussion, see the below risk factors, “ We may not realize all of the anticipated benefits from our acquisitions, including our recent acquisition of Alexco " and “ Issues we have faced at certain segments could require us to write-down the associated long-lived assets. We could face similar issues at our other operations.
For more discussion, see the below risk factors, “ We may not realize all of the anticipated benefits from our acquisitions, including our 2022 acquisition of Alexco" and “ Issues we have faced at certain segments could require us to write-down the carrying value of associated long-lived assets. We could face similar issues at our other operations.
This permitting will require coordination with the Western Shoshone who have long-standing ties to this land area. • At Lucky Friday, an expansion of the current tailings storage facility will be required to achieve the planned life of mine.
This permitting will require coordination with the Western Shoshone who have long-standing ties to this land area. • At Lucky Friday, an expansion of the current tailings storage facility or new, separate tailings storage facility will be required to achieve the planned life of mine.
The extent of any future changes is not known and the potential impact on us as a result of U.S. Congressional action is difficult to predict. Changes to the 1872 Mining Law, if adopted, could adversely affect our ability to economically develop mineral reserves on federal lands. For example, in 2021, the U.S.
The extent of any future changes is not known and the potential impact on us as a result of U.S. Congressional action is difficult to predict. Changes to the 1872 Mining Law, if adopted, could adversely affect our ability to economically develop mineral reserves on federal lands. For example, from time to time the U.S.
Our current business strategy is to focus our financial and human capital in the following areas: • Developing the recently acquired Keno Hill properties located in the Yukon Territory, Canada • Rapidly responding to the threats from the COVID-19 pandemic to protect our workforce, operations and communities while maintaining liquidity. • Operating our properties safely, in an environmentally responsible, and cost-effective manner. • Maintaining and investing in exploration and pre-development projects in the vicinities of mining districts and projects we believe to be under-explored and under-invested: Greens Creek on Alaska's Admiralty Island located near Juneau; North Idaho's Silver Valley in the historic Coeur d'Alene Mining District; the silver-producing district near Durango, Mexico; in the vicinity of our Casa Berardi mine and the Heva-Hosco project in the Abitibi region of northwestern Quebec, Canada; our projects in the Keno Hill mining district in the Yukon Territory, Canada; our projects located in three districts in Nevada; northwestern Montana; the Creede district of southwestern Colorado; the Kinskuch project in British Columbia, Canada; and the Republic mining district in Washington state. • Improving operations at each of our mines, which includes incurring costs for new technologies and equipment. • Expanding our proven and probable reserves, minerals resources and production capacity at our properties. • Conducting our business with financial stewardship to preserve our financial position in varying metals price and operational environments. • Advancing permitting at our Montana exploration project. • Continuing to seek opportunities to acquire and invest in mining and exploration properties and companies. 4 Metals Prices Our operating results are substantially dependent upon the prices of silver, gold, lead and zinc, which can fluctuate widely.
Our current business strategy is to focus our financial and human capital in the following areas: • Developing the Keno Hill properties located in the Yukon Territory, Canada • Operating our properties safely, and in an environmentally responsible and cost-effective manner. • Maintaining and investing in exploration and pre-development projects in the vicinities of mining districts and projects we believe to be under-explored and under-invested: Greens Creek on Alaska's Admiralty Island located near Juneau; North Idaho's Silver Valley in the historic Coeur d'Alene Mining District; the silver-producing district near Durango, Mexico; in the vicinity of our Casa Berardi mine and the Heva-Hosco project in the Abitibi region of northwestern Quebec, Canada; our projects in the Keno Hill mining district in the Yukon Territory, Canada; our projects located in three districts in Nevada; northwestern Montana; the Creede district of southwestern Colorado; the Kinskuch project in British Columbia, Canada; and the Republic mining district in Washington state. • Improving operations at each of our mines, which includes incurring costs for new technologies and equipment. • Expanding our proven and probable reserves, minerals resources and production capacity at our properties. • Conducting our business with financial stewardship to preserve our financial position in varying metals price and operational environments. • Advancing permitting at our Montana exploration project. • Continuing to seek opportunities to acquire and invest in mining and exploration properties and companies. 4 Metals Prices Our operating results are substantially dependent upon the prices of silver, gold, lead and zinc, which can fluctuate widely.
See the risk factor below, “ We may not realize all of the anticipated benefits from our acquisitions, including our recent acquisition of Alexco. ” Issues we have faced at certain segments could require us to write-down the associated long-lived assets. We could face similar issues at our other operations.
See the risk factor below, “ We may not realize all of the anticipated benefits from our acquisitions, including our 2022 acquisition of Alexco. ” Issues we have faced at certain segments could require us to write-down the carrying value of associated long-lived assets. We could face similar issues at our other operations.
See Note 9 of Notes to Consolidated Financial Statements for more information on these forward contract programs. Our ability to recognize the benefits of deferred tax assets related to net operating loss carryforwards and other items is dependent on future cash flows and taxable income.
See Note 10 of Notes to Consolidated Financial Statements for more information on these forward contract programs. 12 Our ability to recognize the benefits of deferred tax assets related to net operating loss carryforwards and other items is dependent on future cash flows generating taxable income.
Operation, Climate, Development, Exploration and Acquisition Risks Natural disasters, public health crises (including COVID-19), political crises, and other catastrophic events or other events outside of our control may materially and adversely affect our business or financial results.
Operation, Climate, Development, Exploration and Acquisition Risks Natural disasters, public health crises, political crises, and other catastrophic events or other events outside of our control may materially and adversely affect our business or financial results.
In 2016, we also initiated financially-settled forward contract programs to manage exposure to fluctuations in the exchange rates between the U.S. dollar (“USD”) and the Canadian dollar (“CAD”) and the impact on our future operating costs denominated in CAD. In 2021, we initiated a similar program related to future development costs denominated in CAD.
We also use financially-settled forward contract programs to manage exposure to fluctuations in the exchange rates between the U.S. dollar (“USD”) and the Canadian dollar (“CAD”) and the impact on our future operating costs denominated in CAD. We use a similar program related to future development costs denominated in CAD.
These costs could significantly increase and we might not be able to provide financial assurance .” Our U.S. operations are subject to the Clean Water Act, which requires permits for certain discharges into waters of the United States.
These costs could significantly increase and we might not be able to provide financial assurance .” Our U.S. operations are subject to the CWA, which requires permits for certain discharges into waters of the United States.
However, tariff exemptions were granted to a number of smelters in China in 2022, 2021 and 2020, and we sold silver concentrates to China representing approximately 19%, 6% and 10% of our total revenues for 2022, 2021 and 2020, respectively, which were not subject to tariffs due to the exemptions.
However, tariff exemptions were granted to a number of smelters in China in 2023, 2022 and 2021, and we sold silver concentrates to China representing approximately 15%, 19%, and 6% of our total revenues for 2023, 2022 and 2021, respectively, which were not subject to tariffs due to the exemptions.
Our environmental and asset retirement obligations and voluntary expenditures could have a material adverse impact on our cash flows, results of operations, or financial condition. For information on our potential environmental liabilities and asset retirement obligations, see Note 4 and Note 14 of Notes to Consolidated Financial Statements .
Our environmental and asset retirement obligations and voluntary expenditures could have a material adverse impact on our cash flows, results of operations, or financial condition. For information on our potential environmental liabilities and asset retirement obligations, see Note 5 and Note 16 of Notes to Consolidated Financial Statements .
See Note 11 of Notes to Consolidated Financial Statements for more information on our common stock dividend policy. From the fourth quarter of 2011 through and including the fourth quarter of 2022, our board of directors has declared a common stock dividend under the policy described above.
See Note 12 of Notes to Consolidated Financial Statements for more information on our common stock dividend policy. From the fourth quarter of 2011 through and including the fourth quarter of 2023, our board of directors has declared a common stock dividend under the policy described above.
Congress debated imposing royalties on minerals extracted from federal lands. Although legislation was not passed as of the date of this report, it is possible that in the future royalties or taxes will be imposed on mining operations conducted on federal land, which could adversely impact our financial results.
Congress debates imposing royalties on minerals extracted from federal lands. Although such legislation has not passed as of the date of this report, it is possible that in the future royalties or taxes will be imposed on mining operations conducted on federal land, which could adversely impact our financial results.
Further, when we use the services of a surety company to provide the required bond for reclamation, the surety companies often require us to post collateral with them, including letters of credit.
Further, when we use the services of a surety company to provide the required bond for reclamation, the surety companies often require us to post collateral with them.
A joint final Environmental Impact Statement with respect to the Montanore site, which is located in the state of Montana, was issued in December 2015 by the USFS and the Montana Department of Environmental Quality (“DEQ”), and each agency issued a Record of Decision (“ROD”) in February 2016 providing approval for development of Montanore.
A joint final Environmental Impact Statement with respect to the Montanore site (now known as the Libby Exploration site), which is located in the state of Montana, was issued in December 2015 by the USFS and the Montana Department of Environmental Quality (“DEQ”), and each agency issued a Record of Decision (“ROD”) in February 2016 providing approval for development of Montanore.
We derive a significant amount of revenue from a relatively small number of customers and occasionally enter into concentrate spot market sales with metal traders. For the fiscal year ended December 31, 2022, our three largest customers accounted for approximately 35%, 24% and 11%, respectively, of our total revenues.
We derive a significant amount of revenue from a relatively small number of customers and occasionally enter into concentrate spot market sales with metal traders. For the fiscal year ended December 31, 2023, our three largest customers accounted for approximately 24%, 16% and 16%, respectively, of our total revenues.
At December 31, 2022, we had accrued $117 million as a provision for environmental and asset retirement obligations. We cannot assure you that we have accurately estimated these obligations, and in the future our accrual could materially change and we could voluntarily incur expenditures in excess of our accrual.
At December 31, 2023, we had accrued $120.5 million as a provision for environmental and asset retirement obligations. We cannot assure you that we have accurately estimated these obligations, and in the future our accrual could materially change and we could voluntarily incur expenditures in excess of our accrual.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeSales, total cost of sales, gross profit, Cash Cost, After By-product Credits, per Ounce (non-GAAP) and All-In Sustaining Cost, After By-product Credits, per Ounce (“AISC”) (non-GAAP) at our operations for 2022, 2021 and 2020 were as follows (in thousands, except for Cash Cost and AISC, each After By-Product Credits, per Ounce): Silver Gold Greens Creek Lucky Friday Other (3) Total Silver (2) Casa Berardi Nevada Operations & Other (4) Total Gold 2022: Sales $ 335,062 $ 147,814 — $ 482,876 $ 235,136 $ 893 $ 236,029 Total cost of sales (232,718 ) (116,598 ) — (349,316 ) (248,898 ) (4,535 ) (253,433 ) Gross profit (loss) $ 102,344 $ 31,216 — $ 133,560 $ (13,762 ) $ (3,642 ) $ (17,404 ) Cash Cost, After By-product Credits, per Silver or Gold Ounce (1) $ 0.70 $ 5.06 — $ 2.06 $ 1,478 $ — $ 1,478 AISC, After By-product Credits, per Silver or Gold Ounce (1) $ 5.77 $ 12.86 — $ 11.25 $ 1,825 $ — $ 1,825 2021: Sales $ 384,843 $ 131,488 $ 176 $ 516,507 $ 245,152 $ 45,814 $ 290,966 Total cost of sales (213,113 ) (97,538 ) (247 ) (310,898 ) (229,829 ) (48,945 ) (278,774 ) Gross profit (loss) $ 171,730 $ 33,950 $ (71 ) $ 205,609 $ 15,323 $ (3,131 ) $ 12,192 Cash Cost, After By-product Credits, per Silver or Gold Ounce (1) $ (0.65 ) $ 6.60 $ 1.37 $ 1,125 $ 1,137 $ 1,127 AISC, After By-product Credits, per Silver or Gold Ounce (1) $ 3.19 $ 14.34 9.19 $ 1,399 $ 1,211 $ 1,374 2020: Sales $ 327,820 $ 63,025 $ 32,906 $ 423,751 $ 209,224 $ 58,898 $ 268,122 Total cost of sales (210,748 ) (56,706 ) (24,104 ) (291,558 ) (194,414 ) (44,801 ) (239,215 ) Gross profit (loss) $ 117,072 $ 6,319 $ 8,802 $ 132,193 $ 14,810 $ 14,097 $ 28,907 Cash Cost, After By-product Credits, per Silver or Gold Ounce (1) $ 4.88 $ 9.34 $ 5.18 $ 1,131 $ 716 $ 1,045 AISC, After By-product Credits, per Silver or Gold Ounce (1) $ 7.97 $ 18.22 $ 11.37 $ 1,436 $ 787 $ 1,302 58 (1) A reconciliation of these non-GAAP measures to total cost of sales, the most comparable GAAP measure, can be found below in Reconciliation of Total Cost of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) .
Biggest changeSales, total cost of sales, gross profit (loss), Cash Cost, After By-product Credits, per Ounce (“Cash Cost”) (non-GAAP) and AISC (non-GAAP) at our operating units for 2023, 2022 and 2021 were as follows (in thousands, except for Cash Cost and AISC): Silver Gold Greens Creek Lucky Friday Keno Hill Other (3) Total Silver (2) Casa Berardi Nevada Operations & Other (4) Total Gold 2023: Sales $ 384,504 $ 116,284 $ 35,518 — $ 536,306 $ 177,678 $ 6,243 $ 183,921 Total cost of sales (259,895 ) (84,185 ) (35,518 ) — (379,598 ) (221,341 ) (6,339 ) (227,680 ) Gross profit (loss) $ 124,609 $ 32,099 $ — — $ 156,708 $ (43,663 ) $ (96 ) $ (43,759 ) Cash Cost, After By-product Credits, per Silver or Gold Ounce (1) $ 2.53 $ 5.51 $ 3.23 $ 1,652 $ 1,652 AISC, After By-product Credits, per Silver or Gold Ounce (1) $ 7.14 $ 12.21 $ 11.76 $ 2,048 $ 2,048 2022: Sales $ 335,062 $ 147,814 $ — $ — $ 482,876 $ 235,136 $ 893 $ 236,029 Total cost of sales (232,718 ) (116,598 ) — — (349,316 ) (248,898 ) (4,535 ) (253,433 ) Gross profit (loss) $ 102,344 $ 31,216 $ — $ — $ 133,560 $ (13,762 ) $ (3,642 ) $ (17,404 ) Cash Cost, After By-product Credits, per Silver or Gold Ounce (1) $ 0.70 $ 5.06 $ 2.06 $ 1,478 $ 1,478 AISC, After By-product Credits, per Silver or Gold Ounce (1) $ 5.17 $ 12.86 10.66 $ 1,773 $ 1,773 2021: Sales $ 384,843 $ 131,488 $ — $ 176 $ 516,507 $ 245,152 $ 45,814 $ 290,966 Total cost of sales (213,113 ) (97,538 ) — (247 ) (310,898 ) (229,829 ) (48,945 ) (278,774 ) Gross profit (loss) $ 171,730 $ 33,950 $ — $ (71 ) $ 205,609 $ 15,323 $ (3,131 ) $ 12,192 Cash Cost, After By-product Credits, per Silver or Gold Ounce (1) $ (0.65 ) $ 6.60 $ 1.37 $ 1,125 $ 1,137 $ 1,127 AISC, After By-product Credits, per Silver or Gold Ounce (1) $ 2.70 $ 14.34 $ 8.65 $ 1,359 $ 1,211 $ 1,341 (1) A reconciliation of these non-GAAP measures to total cost of sales, the most comparable GAAP measure, can be found below in Reconciliation of Total Cost of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) .
In addition, we do not receive sufficient revenue from silver at Casa Berardi or the Nevada Operations to warrant classification of such as a co-product.
In addition, we do not receive sufficient revenue from silver at the Casa Berardi or Nevada Operations to warrant classification of such as a co-product.
Suspension-related costs are reported in a separate line item on our consolidated statements of operations and excluded from the calculations of cost of sales and other direct production costs and depreciation, depletion and amortization, total production costs per ton and Cash Cost and AISC, After By-product Credits, per Gold Ounce. See Item 1A.
Suspension-related costs are reported in a separate line item on our consolidated statements of operations and excluded from the calculations of total cost of sales and other direct production costs and depreciation, depletion and amortization, total production costs per ton and Cash Cost and AISC, After By-product Credits, per Gold Ounce. See Item 1A.
The higher cost of sales in 2022 resulted from increased production costs due to: (i) increase in ore tonnage by 4% compared to 2021 as more lower grade surface material was processed (ii) higher operating costs reflecting inflationary pressures particularly for labor and consumables (iii) higher mill contractor costs related to maintenance and optimization activities, and (iv) higher underground maintenance costs resulting from repairs and replacements of major components for the production fleet.
The higher cost of sales in 2022 resulted from increased production costs due to: (i) increase in ore tonnage by 4% compared to 2021 as more lower grade surface material was processed, (ii) 72 higher operating costs reflecting inflationary pressures particularly for labor and consumables, (iii) higher mill contractor costs related to maintenance and optimization activities, and (iv) higher underground maintenance costs resulting from repairs and replacements of major components for the production fleet.
The price adjustments related to silver, gold, zinc and lead contained in our concentrate sales were partially offset by gains and losses on forward contracts for those metals for each year (see Note 9 of Notes to Consolidated Financial Statements for more information).
The price adjustments related to silver, gold, zinc and lead contained in our concentrate sales were partially offset by gains and losses on forward contracts for those metals for each year (see Note 10 of Notes to Consolidated Financial Statements for more information).
Because for Greens Creek and Lucky Friday we consider zinc, lead and gold to be by-products of our silver production, the values of these metals offset operating costs within our calculations of Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce.
Because for Greens Creek, Lucky Friday and Keno Hill we consider zinc, lead and gold to be by-products of our silver production, the values of these metals offset operating costs within our calculations of Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce.
Gross profit in 2022 of $31.2 million, was $2.7 million lower than 2021, due to lower realized prices and higher production costs in 2022 reflecting inflationary cost pressures and more tons milled.
Gross profit in 2022 of $31.2 million, was $2.7 million lower than 2021, due to lower realized prices and higher production costs in 2022 reflecting inflationary cost pressures and more tons milled. See Item 1A.
Accordingly, we believe the identification of zinc, lead and gold as by-product credits at Greens Creek and Lucky Friday is appropriate because of their lower economic value compared to silver and due to the fact that silver is the primary product we intend to produce.
Accordingly, we believe the identification of gold, lead and zinc as by-product credits at Greens Creek, Lucky Friday and Keno Hill is appropriate because of their lower economic value compared to silver and due to the fact that silver is the primary product we intend to produce at those locations.
Subsequent to November 1, 2021, any gains or losses on base metals derivative contracts designated as cash flow hedges are deferred in other comprehensive income until the transaction occurs. • Net foreign exchange gain of $7.2 million in 2022 compared to a gain of $0.4 million and a loss of $4.6 million in 2021 and 2020, respectively, on translation of our monetary assets and liabilities at Casa Berardi and San Sebastian. • Interest expense of $42.8 million, $41.9 million and $49.6 million in 2022, 2021 and 2020, respectively.
Subsequent to November 1, 2021, any gains or losses on base metals derivative contracts designated as cash flow hedges are deferred in other comprehensive income until the transaction occurs. • Net foreign exchange loss of $3.8 million in 2023, compared to a gain of $7.2 million and $0.4 million in 2022 and 2021, respectively, on translation of our monetary assets and liabilities at Casa Berardi, Keno Hill and San Sebastian. • Interest expense of $43.3 million, $42.8 million and $41.9 million in 2023, 2022 and 2021, respectively.
We believe the identification of silver as a by-product credit is appropriate at Casa Berardi and the Nevada Operations because of its lower economic value compared to gold and because gold is the primary product we intend to produce there.
We believe the identification of silver as a by-product credit is appropriate at Casa Berardi and the Nevada Operations because of its lower economic value compared to gold and due to the fact that gold is the primary product we intend to produce.
For the year ended December 31, 2022, we reported loss applicable to common stockholders of $37.9 million compared to income of $34.5 million and a loss of $10.0 million in 2021 and 2020, respectively. The following factors contributed to those differences: • Variances in gross profit (loss) at our operations as illustrated in the table above.
For the year ended December 31, 2023, we reported loss applicable to common stockholders of $84.8 million compared to a loss of $37.9 million and income of $34.5 million in 2022 and 2021, respectively. The following factors contributed to those differences: • Variances in gross profit (loss) at our operations as illustrated in the table above.
Item 1A. Risk Factors - Our ore reserve and resource estimates may be imprecise.
Item 1A. Risk Factors - Our mineral reserve and resource estimates may be imprecise.
The components for each period are summarized in the following table (in thousands): Year Ended December 31, 2022 2021 2020 Gain (loss) on derivative contracts $ 844 $ (32,655 ) $ (22,074 ) Unrealized (loss) gain on investments in equity securities (5,632 ) (4,295 ) 10,268 Gain on disposition or exchange of investments 65 1,158 — Total fair value adjustments, net $ (4,723 ) $ (35,792 ) $ (11,806 ) Prior to November 1, 2021, we did not designate and account for any of our base metal derivative contracts as cash flow hedges for accounting purposes and accordingly any changes in fair value of our base metals derivative contracts were recognized in gain(loss) on derivative contracts.
The components for each period are summarized in the following table (in thousands): Year Ended December 31, 2023 2022 2021 Gain (loss) on derivative contracts $ 3,168 $ 844 $ (32,655 ) Unrealized (loss) gain on investments in equity securities (243 ) (5,632 ) (4,295 ) Gain on disposition or exchange of investments — 65 1,158 Total fair value adjustments, net $ 2,925 $ (4,723 ) $ (35,792 ) Prior to November 1, 2021, we did not designate and account for any of our base metal derivative contracts as cash flow hedges for accounting purposes and accordingly any changes in fair value of our base metals derivative contracts were recognized in gain (loss) on derivative contracts.
Gross profit decreased by $69.4 million to $102.3 million in 2022 from $171.7 million in 2021, as lower realized prices for all metals sold other than gold, and lower payable metal quantities sold compared to 2021, was further compounded by higher production costs reflecting inflationary pressures and more tons milled, and unfavorable changes in concentrate smelter terms. See Item 1A.
Gross profit decreased by $69.4 million to $102.3 million in 2022 from $171.7 million in 2021, as lower realized prices for all metals sold other than gold, and lower payable metal quantities sold compared to 2021, was further compounded by higher production costs reflecting inflationary pressures and more tons milled, and unfavorable changes in concentrate smelter terms. 67 Capital additions increased by $6.6 million in 2023 to $43.5 million compared to 2022.
See the Greens Creek , Lucky Friday , Casa Berardi , and Nevada Operations sections below. • General and administrative costs were $43.4 million, $34.6 million and $35.6 million in 2022, 2021 and 2020 respectively.
See the Greens Creek , Lucky Friday , Keno Hill, Casa Berardi , and Nevada Operations sections below. • General and administrative costs were $42.7 million, $43.4 million and $34.6 million in 2023, 2022 and 2021 respectively.
(4) Other includes $474,000 of sales and $464,000 of cost of sales of the environmental services business acquired as part of the Alexco acquisition While revenue from zinc, lead and gold by-products is significant, we believe that identification of silver as the primary product of Greens Creek and Lucky Friday is appropriate because: • silver has historically accounted for a higher proportion of revenue than any other metal and is expected to do so in the future; • we have historically presented each of these mines as a primary silver producer, based on the original analysis that justified putting the project into production, and believe that consistency in disclosure is important to our investors regardless of the relationships of metals prices and production from year to year; • metallurgical treatment maximizes silver recovery; and • the Greens Creek and Lucky Friday deposits are massive sulfide deposits containing an unusually high proportion of silver; and in most of their working areas, Greens Creek and Lucky Friday utilize selective mining methods in which silver is the metal targeted for highest recovery.
While revenue from zinc, lead and gold by-products is significant, we believe that identification of silver as the primary product of Greens Creek, Lucky Friday, and Keno Hill is appropriate because: • silver has historically accounted for a higher proportion of revenue than any other metal and is expected to do so in the future; • we have historically presented the Greens Creek and Lucky Friday units as primary silver producers, based on the original analysis that justified putting the project into production, and the same analysis applies to the Keno Hill unit, and further we believe that consistency in disclosure is important to our investors regardless of the relationships of metals prices and production from year to year; • metallurgical treatment maximizes silver recovery; • the Greens Creek, Lucky Friday and Keno Hill deposits are massive sulfide deposits containing an unusually high proportion of silver; and • in most of their working areas, Greens Creek, Lucky Friday and Keno Hill utilize selective mining methods in which silver is the metal targeted for highest recovery.
Due to the time elapsed between shipment of concentrates and final settlement with customers, we must estimate the prices at which sales of our metals will be settled. Previously recorded sales are adjusted to estimated settlement metals prices each period through final settlement. We recorded net negative price adjustments to provisional settlements of $20.8 million in 2022.
Due to the time elapsed between shipment of concentrates and final settlement with customers, we must estimate the prices at which sales of our metals will be settled. Previously recorded sales are adjusted to estimated settlement metals prices each period through final settlement.
See Corporate Matters and Note 6 of Notes to Consolidated Financial Statements for more information. 60 Greens Creek Dollars are in thousands (except per ounce and per ton amounts) Years Ended December 31, 2022 2021 2020 Sales $ 335,062 $ 384,843 $ 327,820 Cost of sales and other direct production costs (183,807 ) (164,403 ) (161,056 ) Depreciation, depletion and amortization (48,911 ) (48,710 ) (49,692 ) Total cost of sales (232,718 ) (213,113 ) (210,748 ) Gross Profit $ 102,344 $ 171,730 $ 117,072 Tons of ore milled 881,445 841,967 818,408 Production: Silver (ounces) 9,741,935 9,243,222 10,494,726 Gold (ounces) 48,216 46,088 48,491 Zinc (tons) 52,312 53,648 56,814 Lead (tons) 19,480 19,873 21,400 Payable metal quantities sold: Silver (ounces) 8,234,010 8,284,551 9,385,404 Gold (ounces) 35,508 40,149 42,407 Zinc (tons) 34,856 36,581 41,832 Lead (tons) 14,762 15,489 17,415 Ore grades: Silver ounces per ton 13.64 13.51 15.65 Gold ounces per ton 0.08 0.08 0.08 Zinc percent 6.69 7.11 7.58 Lead percent 2.68 2.87 3.13 Total production cost per ton $ 196.73 $ 177.30 $ 179.37 Cash Cost, After By-product Credits, per Silver Ounce (1) $ 0.70 $ (0.65 ) $ 4.88 AISC, After By-Product Credits, per Silver Ounce (1) $ 5.77 $ 3.19 $ 7.97 Capital additions $ 36,898 $ 23,883 $ 19,685 (1) A reconciliation of these non-GAAP measures to total cost of sales, the most comparable GAAP measure, can be found below in Reconciliation of Total Cost of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) .
See Corporate Matters and Note 7 of Notes to Consolidated Financial Statements for more information. 66 Greens Creek Dollars are in thousands (except per ounce and per ton amounts) Years Ended December 31, 2023 2022 2021 Sales $ 384,504 $ 335,062 $ 384,843 Cost of sales and other direct production costs (205,900 ) (183,807 ) (164,403 ) Depreciation, depletion and amortization (53,995 ) (48,911 ) (48,710 ) Total cost of sales (259,895 ) (232,718 ) (213,113 ) Gross Profit $ 124,609 $ 102,344 $ 171,730 Tons of ore milled 914,796 881,445 841,967 Production: Silver (ounces) 9,731,752 9,741,935 9,243,222 Gold (ounces) 60,896 48,216 46,088 Zinc (tons) 51,496 52,312 53,648 Lead (tons) 19,578 19,480 19,873 Payable metal quantities sold: Silver (ounces) 8,493,040 8,234,010 8,284,551 Gold (ounces) 49,790 35,508 40,149 Zinc (tons) 36,042 34,856 36,581 Lead (tons) 15,247 14,762 15,489 Ore grades: Silver ounces per ton 13.31 13.64 13.51 Gold ounces per ton 0.09 0.08 0.08 Zinc percent 6.35 6.69 7.11 Lead percent 2.60 2.68 2.87 Total production cost per ton $ 204.20 $ 196.73 $ 177.30 Cash Cost, After By-product Credits, per Silver Ounce (1) $ 2.53 $ 0.70 $ (0.65 ) AISC, After By-Product Credits, per Silver Ounce (1) $ 7.14 $ 5.17 $ 2.70 Capital additions $ 43,542 $ 36,898 $ 23,883 (1) A reconciliation of these non-GAAP measures to total cost of sales, the most comparable GAAP measure, can be found below in Reconciliation of Total Cost of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) .
The decrease in 2022 of $5.8 million is primarily due to the settlement in 2021 of a lawsuit for $6.5 million related to a 1989 agreement entered into by our subsidiary, CoCa Mines, Inc. and its subsidiary, Creede Resources, Inc.
The decrease in 2022 compared to 2021 of $5.8 million is primarily due to the settlement in 2021 of a lawsuit for $6.5 million related to a 1989 agreement entered into by our subsidiary, CoCa Mines, Inc. and its subsidiary, Creede Resources, Inc. • Ramp-up and suspension costs were $76.3 million, $24.1 million and $23.0 million in 2023, 2022 and 2021, respectively.
Lucky Friday Dollars are in thousands (except per ounce and per ton amounts) Years Ended December 31, 2022 2021 2020 Sales $ 147,814 $ 131,488 $ 63,025 Cost of sales and other direct production costs (82,894 ) (70,692 ) (45,233 ) Depreciation, depletion and amortization (33,704 ) (26,846 ) (11,473 ) Total cost of sales (116,598 ) (97,538 ) (56,706 ) Gross profit $ 31,216 $ 33,950 $ 6,319 Tons of ore milled 356,907 321,837 179,208 Production: Silver (ounces) 4,412,764 3,564,128 2,031,874 Lead (tons) 29,233 23,137 12,727 Zinc (tons) 12,436 9,969 6,298 Payable metal quantities sold: Silver (ounces) 4,039,435 3,288,261 1,866,883 Lead (tons) 26,660 21,218 11,692 Zinc (tons) 8,802 7,046 4,517 Ore grades: Silver ounces per ton 13.00 11.64 11.85 Lead percent 8.70 7.60 7.49 Zinc percent 3.90 3.44 3.88 Total production cost per ton $ 223.55 $ 191.50 $ 251.49 Cash Cost, After By-product Credits, per Silver Ounce (1) $ 5.06 $ 6.60 $ 9.34 AISC, After By-product Credits, per Silver Ounce (1) $ 12.86 $ 14.34 $ 18.22 Capital additions $ 50,992 $ 29,885 $ 25,776 (1) A reconciliation of these non-GAAP measures to total cost of sales, the most comparable GAAP measure, can be found below in Reconciliation of Total Cost of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) .
The increase in Cash Cost and AISC, each After By-product Credits, per Silver Ounce in 2022 compared to 2021 was primarily due to higher production costs and sustaining capital expenditures, partially offset by higher by-product credits and production. 68 Lucky Friday Dollars are in thousands (except per ounce and per ton amounts) Years Ended December 31, 2023 2022 2021 Sales $ 116,284 $ 147,814 $ 131,488 Cost of sales and other direct production costs (59,860 ) (82,894 ) (70,692 ) Depreciation, depletion and amortization (24,325 ) (33,704 ) (26,846 ) Total cost of sales (84,185 ) (116,598 ) (97,538 ) Gross profit $ 32,099 $ 31,216 $ 33,950 Tons of ore milled 231,129 356,907 321,837 Production: Silver (ounces) 3,086,119 4,412,764 3,564,128 Lead (tons) 19,543 29,233 23,137 Zinc (tons) 7,944 12,436 9,969 Payable metal quantities sold: Silver (ounces) 3,020,116 4,039,435 3,288,261 Lead (tons) 19,079 26,660 21,218 Zinc (tons) 6,160 8,802 7,046 Ore grades: Silver ounces per ton 14.00 13.00 11.64 Lead percent 8.90 8.70 7.60 Zinc percent 4.10 3.90 3.44 Total production cost per ton $ 218.45 $ 223.55 $ 191.50 Cash Cost, After By-product Credits, per Silver Ounce (1) $ 5.51 $ 5.06 $ 6.60 AISC, After By-product Credits, per Silver Ounce (1) $ 12.21 $ 12.86 $ 14.34 Capital additions $ 65,337 $ 50,992 $ 29,885 (1) A reconciliation of these non-GAAP measures to total cost of sales, the most comparable GAAP measure, can be found below in Reconciliation of Total Cost of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) .
Significant components related to development $18.5 million, the service hoist $6.6 million, coarse ore bunker $4.0 million, shaft and related infrastructure $4.4 million, pond 4 $6.2 million and underground mobile equipment $6.2 million. 63 The chart below illustrates the factors contributing to the variances in Cash Cost, After By-product Credits, Per Silver Ounce for 2022, 2021 and the fourth quarter of 2020.
Significant components related to development ($21.7 million), the service hoist ($8.3 million), coarse ore bunker ($6.6 million), shaft and related infrastructure ($4.4 million), drilling ($4.9 million) and underground mobile equipment ($4.6 million). The chart below illustrates the factors contributing to the variances in Cash Cost, After By-product Credits, Per Silver Ounce for 2023, 2022 and 2021.
Consolidated Results of Operations Sales of products by metal for the years ended December 31, 2020, 2021 and 2022, and the approximate variances attributed to differences in metals prices, sales volumes and smelter terms, were as follows: (in thousands) Silver Gold Base metals Less: smelter and refining charges Total sales of products 2020 $ 260,227 $ 356,166 $ 143,841 $ (68,361 ) $ 691,873 Variances - 2021 versus 2020: Price 43,420 6,483 49,028 49 98,980 Volume (10,001 ) (612 ) 7,854 869 (1,890 ) Smelter terms — — — 18,510 18,510 2021 293,646 362,037 200,723 (48,933 ) 807,473 Variances - 2022 versus 2021: Price (45,590 ) 676 (3,710 ) (1,270 ) (49,894 ) Volume 17,089 (63,719 ) 9,428 (2,172 ) (39,374 ) Smelter terms (91 ) (84 ) — 402 227 2022 $ 265,054 $ 298,910 $ 206,441 $ (51,973 ) $ 718,432 Average market and realized metals prices for 2022, 2021 and 2020 were as follows: Average price for the year ended December 31, 2022 2021 2020 Silver — London PM Fix ($/ounce) $ 21.75 $ 25.17 $ 20.51 Realized price per ounce 21.53 25.24 21.15 Gold — London PM Fix ($/ounce) 1,801 1,800 1,770 Realized price per ounce 1,803 1,796 1,757 Lead — LME Final Cash Buyer ($/pound) 0.98 1.00 0.83 Realized price per pound 1.01 1.03 0.84 Zinc — LME Final Cash Buyer ($/pound) 1.58 1.36 1.03 Realized price per pound 1.41 1.44 1.03 57 Average realized prices differ from average market prices primarily because concentrate sales are generally recorded as revenues at the time of shipment at forward prices for the estimated month of settlement, which differ from average market prices.
Consolidated Results of Operations Total metal sales for the years ended December 31, 2023, 2022 and 2021, and the approximate variances attributed to differences in metals prices, sales volumes and smelter terms, were as follows: (in thousands) Silver Gold Base metals Less: smelter and refining charges Total sales of products 2021 $ 293,646 $ 362,037 $ 200,723 $ (48,933 ) $ 807,473 Variances - 2022 versus 2021: Price (45,590 ) 676 (3,710 ) (1,270 ) (49,894 ) Volume 17,089 (63,719 ) 9,428 (2,172 ) (39,374 ) Smelter terms (91 ) (84 ) — 402 227 2022 265,054 298,910 206,441 (51,973 ) 718,432 Variances - 2023 versus 2022: Price 19,682 18,044 (2,897 ) (624 ) 34,205 Volume 17,548 (42,343 ) (14,586 ) 148 (39,233 ) Smelter terms — — — 1,540 1,540 2023 $ 302,284 $ 274,611 $ 188,958 $ (50,909 ) $ 714,944 Average market and realized metals prices for 2023, 2022 and 2021 were as follows: Average price for the year ended December 31, 2023 2022 2021 Silver Realized price per ounce $ 23.33 $ 21.53 $ 25.24 London PM Fix ($/ounce) 23.39 21.75 25.17 Gold Realized price per ounce 1,939 1,803 1,796 London PM Fix ($/ounce) 1,943 1,801 1,800 Lead Realized price per pound 1.03 1.01 1.03 LME Final Cash Buyer ($/pound) 0.97 0.98 1.00 Zinc Realized price per pound 1.35 1.41 1.44 LME Final Cash Buyer ($/pound) $ 1.20 $ 1.58 $ 1.36 Average realized prices differ from average market prices primarily because concentrate sales are generally recorded as revenues at the time of shipment at forward prices for the estimated month of settlement, which differ from average market prices.
Risk Factors - Our profitability could be affected by inflation, including the prices of other commodities" for a discussion of certain risks related to our operations profitability. Total capital additions increased by $21.1 million in 2022 to $51 million compared to 2021 as investments were made to support sustained higher throughput.
Risk Factors - Our profitability could be affected by inflation, including the prices of other commodities for a discussion of certain risks related to our operations profitability. 69 Total capital additions increased by $14.3 million in 2023 to $65.3 million compared to 2022 as investments were made to support sustained higher throughput and costs were incurred to build the secondary egress following the August 2023 fire.
The chart below illustrates the factors contributing to the variances in Cash Cost, After By-product Credits, Per Silver Ounce for 2022 compared to 2021 and 2020: The following table summarizes the components of Cash Cost, After By-product Credits, per Silver Ounce: Years Ended December 31, 2022 2021 2020 Cash Cost, Before By-product Credits, per Silver Ounce $ 23.20 $ 21.33 $ 22.24 By-product credits per silver ounce (22.50 ) (21.98 ) (17.36 ) Cash Cost, After By-product Credits, per Silver Ounce $ 0.70 $ (0.65 ) $ 4.88 The following table summarizes the components of AISC, After By-product Credits, per Silver Ounce: Years Ended December 31, 2022 2021 2020 AISC, Before By-product Credits, per Silver Ounce $ 28.27 $ 25.17 $ 25.33 By-product credits per silver ounce (22.50 ) (21.98 ) (17.36 ) AISC, After By-product Credits, per Silver Ounce $ 5.77 $ 3.19 $ 7.97 The increase in Cash Cost and AISC, each After By-product Credits, per Silver Ounce in 2022 compared to 2021 was primarily due to higher production costs and sustaining capital expenditures, partially offset by higher by-product credits and production.
The chart below illustrates the factors contributing to the variances in Cash Cost, After By-product Credits, Per Silver Ounce for 2023 compared to 2022 and 2021: The following table summarizes the components of Cash Cost, After By-product Credits, per Silver Ounce: Years Ended December 31, 2023 2022 2021 Cash Cost, Before By-product Credits, per Silver Ounce $ 24.85 $ 23.20 $ 21.33 By-product credits per silver ounce (22.32 ) (22.50 ) (21.98 ) Cash Cost, After By-product Credits, per Silver Ounce $ 2.53 $ 0.70 $ (0.65 ) The following table summarizes the components of AISC, After By-product Credits, per Silver Ounce: Years Ended December 31, 2023 2022 2021 AISC, Before By-product Credits, per Silver Ounce $ 29.46 $ 27.67 $ 24.68 By-product credits per silver ounce (22.32 ) (22.50 ) (21.98 ) AISC, After By-product Credits, per Silver Ounce $ 7.14 $ 5.17 $ 2.70 The increase in Cash Cost and AISC, each After By-product Credits, per Silver Ounce in 2023 compared to 2022 was primarily due to higher production costs related to labor, maintenance and consumables and lower by-product credits .
The increase in 2022 of $8.8 million reflects the impact of the Alexco acquisition, higher incentive compensation accruals and compensation adjustments effective July 1, 2022. • Exploration and pre-development expense of $46.0 million, $47.9 million and $18.3 million in 2022, 2021 and 2020, respectively.
The increase in 2022 of $8.8 million compared to 2021 reflects the acquisition of Alexco, higher incentive compensation accruals and annual incentive compensation adjustments. • Exploration and pre-development expense was $32.5 million, $46.0 million and $47.9 million in 2023, 2022 and 2021, respectively.
The following table summarizes the components of Cash Cost, After By-product Credits, per Silver Ounce: Year Ended December 31, Year Ended December 31, Three Months Ended December 31, 2022 2021 2020 Cash Cost, Before By-product Credits, per Silver Ounce $ 23.23 $ 24.12 24.63 By-product credits per silver ounce (18.17 ) (17.52 ) (15.29 ) Cash Cost, After By-product Credits, per Silver Ounce $ 5.06 $ 6.60 $ 9.34 The following table summarizes the components of AISC, After By-product Credits, per Silver Ounce: Year Ended December 31, Year Ended December 31, Three Months Ended December 31, 2022 2021 2020 AISC, Before By-product Credits, per Silver Ounce $ 31.03 $ 31.86 $ 33.51 By-product credits per silver ounce (18.17 ) (17.52 ) (15.29 ) AISC, After By-product Credits, per Silver Ounce $ 12.86 $ 14.34 $ 18.22 The decreases in Cash Cost and AISC, each After By-product Credits, per Silver Ounce in 2022 compared to 2021 and 2021 compared to the fourth quarter of 2020 are due to increased silver production and higher by-product credits, partially offset by higher production costs and sustaining capital expenditures.
The following table summarizes the components of Cash Cost, After By-product Credits, per Silver Ounce: Year Ended December 31, Year Ended December 31, Three Months Ended December 31, 2023 2022 2021 Cash Cost, Before By-product Credits, per Silver Ounce $ 21.45 $ 23.23 24.12 By-product credits per silver ounce (15.94 ) (18.17 ) (17.52 ) Cash Cost, After By-product Credits, per Silver Ounce $ 5.51 $ 5.06 $ 6.60 The following table summarizes the components of AISC, After By-product Credits, per Silver Ounce: Year Ended December 31, Year Ended December 31, Three Months Ended December 31, 2023 2022 2021 AISC, Before By-product Credits, per Silver Ounce $ 28.15 $ 31.03 $ 31.86 By-product credits per silver ounce (15.94 ) (18.17 ) (17.52 ) AISC, After By-product Credits, per Silver Ounce $ 12.21 $ 12.86 $ 14.34 The increase in Cash Cost and AISC, each After By-product Credits, per Silver Ounce in 2023 compared to 2022 was due to lower by-product credits in 2023.
For 2021 and 2020 we recorded positive price adjustments to provisional settlements of $9.3 million and $8.0 million, respectively.
For 2023 and 2021 we recorded positive price adjustments to provisional settlements of $18.2 million and $9.3 million, respectively, and $20.8 million in net negative price adjustments to provisional settlements in 2022.
Total metals production and sales volumes for each period are shown in the following table: Year Ended December 31, 2022 2021 2020 Silver - Ounces produced 14,182,987 12,887,240 13,542,957 Payable ounces sold 12,311,595 11,633,802 12,305,917 Gold - Ounces produced 175,807 201,327 208,962 Payable ounces sold 165,818 201,610 202,694 Lead - Tons produced 48,713 43,010 34,127 Payable tons sold 41,423 36,707 29,108 Zinc - Tons produced 64,748 63,617 63,112 Payable tons sold 43,658 43,626 46,349 The difference between what we report as “ounces/tons produced” and “payable ounces/tons sold” is attributable to the difference between the quantities of metals contained in our products versus the portion of those metals actually paid for by our customers according to the terms of our sales contracts.
Realized prices are calculated by dividing gross revenues for each metal (which include the price adjustments and gains and losses on the forward contracts discussed above) by the payable quantities of each metal included in products sold during the period. 63 Total metals production and sales volumes for each period are shown in the following table: Year Ended December 31, 2023 2022 2021 Silver - Ounces produced 14,342,863 14,182,987 12,887,240 Payable ounces sold 12,955,006 12,311,595 11,633,802 Gold - Ounces produced 151,259 175,807 201,327 Payable ounces sold 141,602 165,818 201,610 Lead - Tons produced 40,347 48,713 43,010 Payable tons sold 35,429 41,423 36,707 Zinc - Tons produced 60,579 64,748 63,617 Payable tons sold 43,050 43,658 43,626 The difference between what we report as “ounces/tons produced” and “payable ounces/tons sold” is attributable to the difference between the quantities of metals contained in our products versus the portion of those metals actually paid for by our customers pursuant to of our sales contract terms.
Casa Berardi Dollars are in thousands (except per ounce and per ton amounts) Years Ended December 31, 2022 2021 2020 Sales $ 235,136 $ 245,152 $ 209,224 Cost of sales and other direct production costs (187,936 ) (149,085 ) (133,862 ) Depreciation, depletion and amortization (60,962 ) (80,744 ) (60,552 ) Total cost of sales (248,898 ) (229,829 ) (194,414 ) Gross (loss) profit $ (13,762 ) $ 15,323 $ 14,810 Tons of ore milled 1,588,739 1,528,246 1,283,701 Production: Gold (ounces) 127,590 134,511 121,492 Silver (ounces) 28,289 33,571 24,142 Payable metal quantities sold: Gold (ounces) 130,245 135,987 117,671 Silver (ounces) 31,788 30,022 25,659 Ore grades: Gold ounces per ton 0.09 0.10 0.12 Silver ounces per ton 0.02 0.03 0.02 Total production cost per ton $ 117.89 $ 98.60 $ 105.71 Cash Cost, After By-product Credits, per Gold Ounce (1) $ 1,478 $ 1,125 $ 1,131 AISC, After By-product Credits, per Gold Ounce (1) $ 1,825 $ 1,399 $ 1,436 Capital additions $ 39,667 $ 49,617 $ 40,840 (1) A reconciliation of these non-GAAP measures to cost of sales and other direct production costs and depreciation, depletion and amortization, the most comparable GAAP measure, can be found below in Reconciliation of Total Cost of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) .
During the year ended December 31, 2023, Keno Hill recorded capital additions of $44.7 million, of which $29.6 million related to mine development and $11.3 million to mobile equipment purchases, crusher modifications and camp upgrades. 71 Casa Berardi Dollars are in thousands (except per ounce and per ton amounts) Years Ended December 31, 2023 2022 2021 Sales $ 177,678 $ 235,136 $ 245,152 Cost of sales and other direct production costs (155,304 ) (187,936 ) (149,085 ) Depreciation, depletion and amortization (66,037 ) (60,962 ) (80,744 ) Total cost of sales (221,341 ) (248,898 ) (229,829 ) Gross (loss) profit $ (43,663 ) $ (13,762 ) $ 15,323 Tons of ore milled 1,446,488 1,588,739 1,528,246 Production: Gold (ounces) 90,363 127,590 134,511 Silver (ounces) 22,415 28,289 33,571 Payable metal quantities sold: Gold (ounces) 91,268 130,245 135,987 Silver (ounces) 22,566 31,788 30,022 Ore grades: Gold ounces per ton 0.07 0.09 0.10 Silver ounces per ton 0.02 0.02 0.03 Total production cost per ton $ 104.75 $ 117.89 $ 98.60 Cash Cost, After By-product Credits, per Gold Ounce (1) $ 1,652 $ 1,478 $ 1,125 AISC, After By-product Credits, per Gold Ounce (1) $ 2,048 $ 1,773 $ 1,359 Capital additions $ 70,056 $ 39,667 $ 49,617 (1) A reconciliation of these non-GAAP measures to total cost of sales, the most comparable GAAP measure, can be found below in Reconciliation of Total Cost of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) .
(2) The calculation of AISC, After By-product Credits, per Ounce for our consolidated silver properties includes corporate costs for general and administrative expense and sustaining exploration and capital costs. (3) Includes results for San Sebastian, which was an operating segment prior to 2021.
(2) The calculation of AISC for our consolidated silver properties includes corporate costs for general and administrative expense and sustaining capital and production and related costs and sustaining capital expenditures for Lucky Friday until the suspension of production during August 2023 following an underground fire for the remainder of 2023 64 (3) Includes results for San Sebastian, which was an operating segment prior to 2021.
The higher expense in 2020 was primarily due to (i) interest recognized on both the Senior Notes and our previously outstanding 6.875% Senior Notes that were due in 2021 (the "2021 Notes") for an overlapping period of almost one month, as the Senior Notes were issued on February 19, 2020 and the 2021 Notes were redeemed on March 19, 2020, (ii) $1.7 million in unamortized initial purchaser discount on the 2021 Notes recognized as expense upon their redemption and (iii) higher interest related to amounts drawn on our revolving credit facility. • Income and mining tax benefit of $7.6 million in 2022 , compared to a benefit of $29.6 million in 2021 and a provision of $8.2 million in 2020,with the benefit in 2021 including $58.4 million for a reduction in the valuation allowance for U.S. deferred tax assets.
The interest in 2023, 2022 and 2021 was primarily related to our Senior Notes with 2023 also including interest expense of $2.8 million on amounts drawn on our revolving credit facility. • Income and mining tax provision of $1.2 million compared to a benefit of $7.6 million and $29.6 million in 2022 and 2021, respectively, with the benefit in 2021 including $58.4 million for a reduction in the valuation allowance for U.S. deferred tax assets.
Risk Factors - Our profitability could be affected by inflation, including the prices of other commodities" for a discussion of certain risks related to our operations profitability. Gross profit increased in 2021 compared to 2020 due to higher average realized gold prices and increase gold production, partially offset by higher cost of sales.
Risk Factors - Our profitability could be affected by inflation, including the prices of other commodities for a discussion of certain risks related to our operations profitability.
The chart below illustrates the factors contributing to Cash Cost, After By-product Credits, Per Gold Ounce for 2022, 2021 and 2020: The following table summarizes the components of Cash Cost, After By-product Credits, per Gold Ounce: Years Ended December 31, 2022 2021 2020 Cash Cost, Before By-product Credits, per Gold Ounce $ 1,483 $ 1,131 $ 1,135 By-product credits per gold ounce (5 ) (6 ) (4 ) Cash Cost, After By-product Credits, per Gold Ounce $ 1,478 $ 1,125 $ 1,131 The following table summarizes the components of AISC, After By-product Credits, per Gold Ounce: Years Ended December 31, 2022 2021 2020 AISC, Before By-product Credits, per Gold Ounce $ 1,830 $ 1,405 $ 1,440 By-product credits per gold ounce (5 ) (6 ) (4 ) AISC, After By-product Credits, per Gold Ounce $ 1,825 $ 1,399 $ 1,436 The increase in Cash Cost and AISC, each After By-product Credits, per Gold Ounce for 2022 compared to 2021 was due to lower gold production, and higher production costs, as discussed above, with AISC, After By-product Credits, per Gold Ounce also impacted by lower sustaining capital, offset by higher exploration.
The chart below illustrates the factors contributing to Cash Cost, After By-product Credits, Per Gold Ounce for 2023, 2022 and 2021: The following table summarizes the components of Cash Cost, After By-product Credits, per Gold Ounce: Years Ended December 31, 2023 2022 2021 Cash Cost, Before By-product Credits, per Gold Ounce $ 1,658 $ 1,483 $ 1,131 By-product credits per gold ounce (6 ) (5 ) (6 ) Cash Cost, After By-product Credits, per Gold Ounce $ 1,652 $ 1,478 $ 1,125 The following table summarizes the components of AISC, After By-product Credits, per Gold Ounce: Years Ended December 31, 2023 2022 2021 AISC, Before By-product Credits, per Gold Ounce $ 2,054 $ 1,778 $ 1,365 By-product credits per gold ounce (6 ) (5 ) (6 ) AISC, After By-product Credits, per Gold Ounce $ 2,048 $ 1,773 $ 1,359 73 The increase in Cash Cost and AISC, each After By-product Credits, per Gold Ounce for 2023 compared to 2022 and 2021 was primarily driven by lower gold production as Casa Berardi transitions from an underground/open pit operation to an open pit only operation, as discussed above.
During 2022, we contributed a total of approximately $9.7 million in shares of our common stock to the plans (see
During 2023, the funded status of our plans assets increased slightly to $27.5 million at December 31, 2023 from $27.0 million at December 31, 2022. During 2023, we contributed a total of approximately $1.0 million in shares of our common stock to the plans (see
In 2022, exploration was primarily at Keno Hill, San Sebastian, Casa Berardi, Greens Creek, Nevada Operations and Kinskuch, while pre-development expense included $3.0 million related to development of the decline to allow drilling of the Hatter Graben area in Nevada. 59 • Provision for closed operations and environmental matters of $8.8 million in 2022 compared to $14.6 million in 2021 and $3.9 million in 2020.
In 2023 exploration and pre-development expense decreased by $13.5 million as exploration activities were focused primarily at Keno Hill, Casa Berardi, Greens Creek and Nevada Operations, with pre-development activities incurred at the Hatter Graben in Nevada and the Libby Exploration project in Montana. • Provision for closed operations and environmental matters of $7.6 million in 2023 compared to $8.8 million in 2022 and $14.6 million in 2021.
Mining of non-refractory ore at Fire Creek in areas where development had already been performed was completed in the fourth quarter of 2020. During 2021, production and revenue was generated from processing of the stockpiled non-refractory ore at the Midas mill and third-party processing of refractory ore in a roaster and autoclave facility, respectively.
During 2021, production and revenue was generated from processing of the stockpiled non-refractory ore at the Midas mill and third-party processing of refractory ore in a roaster and autoclave facility, respectively. The gross loss in 2022 and 2021 resulted primarily from inventory write-downs. See Item 1A.
The higher cost of sales in 2021 resulted from increased production costs due to: (i) increase in ore tonnage by 19% compared to 2020 (ii) mill contractor costs related to maintenance and optimization activities, and (iii) higher underground maintenance costs resulting from repairs and replacements of major components for the production fleet.
The increase in gross loss was also due to the processing of lower grade ore tonnage from both the underground and surface operations, higher costs related to mill maintenance and optimization activities, higher underground maintenance costs resulting from repairs and replacements of major components for the production fleet, and higher fuel and other consumables costs, compared to 2022.
Significant components of the 2022 capital additions were development of $18.7 million, $5.8 million in mobile equipment, $4.9 million in additional new camp housing and $5.8 million in mine infrastructure.
Significant components of the 2023 capital additions were development of $19.4 million, $9.8 million in mobile equipment, and $1.6 million in claims purchases .
The gross loss in 2021 compared to gross profit in 2020 was due to reduced production and higher costs, including inventory write-downs. See Item 1A. Risk Factors - Our profitability could be affected by inflation, including the prices of other commodities" for a discussion of certain risks related to our operations profitability.
Risk Factors - Our profitability could be affected by inflation, including the prices of other commodities for a discussion of certain risks related to our operation's profitability.
The decrease in Cash Cost and AISC, each After By-product Credits, per Gold Ounce for 2021 compared to 2020 was due to higher gold production, partially offset by higher production costs, as discussed above, with AISC, After By-product Credits, per Gold Ounce also impacted by lower sustaining capital, offset by higher exploration. 66 Nevada Operations Dollars are in thousands (except per ounce and per ton amounts) Year Ended December 31, 2022 2021 2020 Sales $ 419 $ 45,814 $ 58,898 Cost of sales and other direct production costs (3,709 ) (33,604 ) (21,956 ) Depreciation, depletion and amortization (361 ) (15,341 ) (22,845 ) Total cost of sales (4,070 ) (48,945 ) (44,801 ) Gross (loss) profit $ (3,651 ) $ (3,131 ) $ 14,097 During 2019, a decision was made to suspend the Nevada Operations activities.
Nevada Operations Dollars are in thousands (except per ounce and per ton amounts) Year Ended December 31, 2023 2022 2021 Sales $ 960 $ 419 $ 45,814 Cost of sales and other direct production costs (896 ) (3,709 ) (33,604 ) Depreciation, depletion and amortization (140 ) (361 ) (15,341 ) Total cost of sales (1,036 ) (4,070 ) (48,945 ) Gross (loss) $ (76 ) $ (3,651 ) $ (3,131 ) Following the strategic decision to suspend the Nevada Operations in 2019, all development was suspended and production and related revenue was generated from previously developed areas.
The decrease in 2022 is primarily due to the receipt of $4.2 million in insurance proceeds related to a coverage lawsuit received during June and September 2022 and the completion of projects to identify and implement potential operation improvements at our operating sites, which drove the increase in cost for 2021 compared to 2020. • Fair value adjustments, net resulted in losses of $4.7 million, $35.8 million and $11.8 million in 2022, 2021 and 2020, respectively.
The income in 2023 compared to the expense in 2022 was primarily due to the receipt of $5.9 million in insurance proceeds in May related to an insurance coverage lawsuit. • Fair value adjustments, net resulted in gains of $2.9 million and losses of $4.7 million and $35.8 million in 2023, 2022 and 2021, respectively.
Risk Factors - Our profitability could be affected by inflation, including the prices of other commodities" for a discussion of certain risks related to our operations profitability. Gross profit of $171.7 million in 2021, was $54.7 million higher than in 2020, reflecting higher realized prices and a favorable changes in concentrate smelter terms which contributed $23.3 million to gross profit.
Risk Factors - Our profitability could be affected by inflation, including the prices of other commodities for a discussion of certain risks related to our operation's profitability.
Fire Creek was placed on care-and-maintenance in the second quarter of 2021 after processing of the remaining non-refractory ore stockpile. During 2022, mining of remnant refractory ore was undertaken during the third and fourth quarters, with the refractory ore sold to a third party. The gross loss in 2022 resulted primarily from inventory write-downs.
During 2023, revenue was generated from the sale of carbon. During 2022, mining of remnant refractory ore was undertaken during the third and fourth quarters, with the refractory ore sold to a third party.
Risk Factors - Operation, Development, Exploration and Acquisition Risks for a discussion of certain risks relating to our recent and ongoing analysis of the carrying value of the Nevada assets. Keno Hill We acquired Keno Hill as part of the Alexco acquisition on September 7, 2022, see Note 1 of Notes to Consolidated Financial Statements for more information.
Risk Factors - Operation, Development, Exploration and Acquisition Risks for a discussion of certain risks relating to our recent and ongoing analysis of the carrying value of the Nevada assets. Corporate Matters Employee Benefit Plans Our defined benefit pension plans, while providing a significant benefit to our employees, have historically represented a significant liability to us.
Significant components of 65 2022 capital expenditures were development of $20.6 million, tailings dam construction costs of $7.6 million and $6.1 million on machinery and equipment. Capital additions increased by $8.8 million in 2021 compared to 2020, primarily due to new 160 zone open pit mine development.
Total capital additions increased by $30.4 million in 2023 compared to 2022 primarily due to purchases of new surface fleet equipment as the mine transitions from an underground to an open pit operation and the construction of tailings storage facilities.
We expect Keno Hill to be in production during the third quarter of 2023. Keno Hill has not generated any revenue since we acquired it, due to being in development. $2.3 million of site specific costs were included in the line item "Ramp-up and suspension costs" on our consolidated statement of operations and comprehensive income for 2022.
For the year ended December 31, 2023, $25.5 million of site specific suspension costs were included within Ramp-up and suspension costs on our consolidated statements of operations and comprehensive (loss) income.
Removed
Realized prices are calculated by dividing gross revenues for each metal (which include the price adjustments and gains and losses on the forward contracts discussed above) by the payable quantities of each metal included in products sold during the period.
Added
(4) Other includes $5.3 million of sales and total cost of sales for the year ended December 31, 2023 and $0.5 million of sales and total cost of sales for the year ended December 31, 2022, related to the environmental services business acquired as part of the Alexco acquisition.
Removed
The increase in 2021 of $10.7 million compared to 2020 is primarily due to the CoCa settlement, and increases of $2.1 million and $2.9 million for accrued estimated rehabilitation costs at the Troy Mine and Johnny M site in New Mexico, respectively (see Note 14 of Notes to Consolidated Financial Statements for more information). • Ramp-up and suspension costs of $24.1 million, $23.0 million and $24.9 million in 2022, 2021 and 2020, respectively. 2022 includes $2.1 million in Keno Hill ramp-up activities following completion of the Alexco acquisition in September 2022. 2022 and 2021 include full year care and maintenance for Nevada and San Sebastian.
Added
The decrease in 2023 of $0.7 million reflects lower incentive compensation accruals compared to 2022 partially offset by annual compensation adjustments effective July 1.
Removed
In 2020 Nevada and San Sebastian were placed on care-and-maintenance, with 2020 also including costs related to ramp-up activities at Lucky Friday and government COVID-19 suspension orders impacting Casa Berardi and San Sebastian. • Other operating expense of $6.3 million , $14.3 million and $11.4 million in 2022, 2021 and 2020, respectively.
Added
The decrease in 2023 compared to 2022 of $1.2 million is primarily due to less reclamation activities 65 at Johnny M in 2023 compared to 2022.
Removed
The interest in 2022, 2021 and 2020 was primarily related to our Senior Notes.
Added
Ramp-up and suspension costs in 2023 include $29.8 million (2022: $2.3 million) related to the ramp up of Keno Hill, $25.5 million related to the suspension of production at Lucky Friday due to the underground fire that occurred in the #2 shaft and $2.2 million at Casa Berardi due its operations being suspended for 20 days in June, due to Quebec wildfires.
Removed
The impacts of the factors above were partially offset by lower metal sales volume primarily due to lower ore grades. 61 Capital additions increased by $13 million in 2022 to $36.9 million compared to 2021.
Added
During 2020, San Sebastian and Nevada were placed on care and maintenance and each of 2021, 2022 and 2023 include care and maintenance costs for these sites.
Removed
The decrease in Cash Cost and AISC, each After By-product Credits, per Silver Ounce in 2021 compared to 2020 was primarily due to higher by-product credits. 62 Restrictions imposed by the State of Alaska beginning in late March 2020 in response to the COVID-19 virus pandemic, including the requirement for employees returning to Alaska to self-quarantine for 14 days (changed in June 2020 to 7 days and subsequently discontinued), caused us to revise the normal operating procedures and incur additional costs for staffing operations at Greens Creek, including for quarantining employees from late March 2020 through the second quarter of 2021.
Added
Year Ended December 31, 2023 2022 2021 Keno Hill $ 29,793 $ 2,254 $ — Lucky Friday 25,548 — — Nevada 16,549 19,743 20,403 Casa Berardi 2,228 — — San Sebastian 2,134 2,117 2,609 Total ramp-up and suspension costs $ 76,252 $ 24,114 $ 23,012 • Other operating income of $1.4 million and expense of $6.3 million and $14.3 million in 2023, 2022 and 2021, respectively.
Removed
The increase in gross profit in 2021 of $27.6 million to $34.0 million compared to 2020 reflected high ore tonnage and metal production as a result of returning to full production during after the strike during the fourth quarter of 2020 (discussed further below). See Item 1A.
Added
Gross profit increased by $22.3 million to $124.6 million in 2023 from $102.3 million in 2022, as higher realized prices for all metals sold other than zinc and higher payable metal quantities for all metals sold compared to 2022, was offset by higher production costs reflecting more tons milled, and related higher labor, maintenance and consumables costs. See Item 1A.
Removed
Total production cost per ton, Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits per Silver Ounce are not presented for the first three quarters of 2020, as production was limited due to the strike and results are not comparable.
Added
During August 2023, the production at the mine was suspended due to a fire that occured while repairing an unused station in the #2 ventilation shaft, which is also the secondary egress (required by MSHA regulations). By early September, the fire had been extinguished, normal ventilation was reestablished and the workforce recalled.
Removed
Following settlement of the unionized employees' strike in early 2020, we commenced restaffing and ramp-up procedures and the mine returned to full production in the fourth quarter of 2020. During the strike, which lasted from March 13, 2017 until January 7, 2020, when the union ratified a new collective bargaining agreement, salaried personnel performed limited production and capital improvements.
Added
Following evaluation of alternatives, it was determined that in order to safely bring the mine back into production in the most rapid and cost effective way, a new secondary egress needed to be developed to bypass the damaged portion of the #2 shaft.
Removed
Costs related to ramp-up activities totaled $8.0 million in 2020 and included non-cash depreciation expense of $6.3 64 million, and are reported in a separate line item on our consolidated statements of operations.
Added
The new egress includes extension of an existing ramp 1,600 feet, installation of a 290-foot-long manway raise, and development of an 850 foot ventilation raise. Production was suspended for the remainder of 2023. Following an MSHA inspection on January 9, 2024, production was resumed. The Company has property and business interruption insurance coverage with an underground sub-limit of $50.0 million.
Removed
These ramp-up and suspension costs are excluded from the calculation of gross profit, total production cost per ton, Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce, when presented.
Added
On January 3, 2024, the Company received a coverage letter from the insurance carrier establishing coverage up to the underground sub-limit of $50.0 million, less any applicable deductions. There can be no assurance as to the total amount or timing of when we will start receiving such proceeds.
Removed
Depreciation, depletion and amortization expense was also higher in 2021 compared to 2020 due to the impact of lower reserves in 2021 on units-of-production depreciation and asset additions could with higher sales quantities. The lower production in 2020 was partially due to a government COVID-19-related order.
Added
Gross profit in 2023 of $32.1 million, was $0.9 million higher than 2022, due to higher grades, higher realized silver and lead prices and higher tons milled per day prior to the shutdown in August compared to 2022.
Removed
We suspended operations at Casa Berardi from March 24, 2020 until April 15, 2020, in response to the Government of Quebec’s COVID-19 order for the mining industry.
Added
The decrease in Cash Cost and AISC, each After By-product Credits, per Silver Ounce in 2022 70 compared to 2021 was due to increased silver production and higher by-product credits, partially offset by higher production costs and sustaining capital expenditures.
Removed
The suspension-related costs totaling $1.6 million for 2020 are reported in a separate line item on our consolidated statements of operations and excluded from the calculations of cost of sales and other direct production costs and depreciation, depletion and amortization, total production cost per ton, and Cash Cost and AISC, After By-product Credits, per Gold Ounce.
Added
K eno Hill We acquired our Keno Hill operations as part of the Alexco acquisition in September 2022, and have focused on development activities and began ramp-up of the mill during the second quarter. A number of safety related matters have slowed the ramp up as Hecla's injury-free standard drives the pace of production and development at Keno Hill.
Removed
Production was suspended at the Hollister mine in the third quarter of 2019 and at the Midas mine and Aurora mill in late 2019. Development ceased at Fire Creek in the second quarter of 2019 when the decision was made to limit near-term production to areas of the mine where development was already completed.
Added
A safety action plan focusing on training, supervision, mining practices, and implementation of the safety processes has been initiated and should be executed during 2024. The average throughput during the ramp-up of the mill has been 230 tons per day, with silver grades milled of 27.7 ounces per ton.
Removed
We spent $15.5 million on exploration activities and pre-development activities during 2022.
Added
Tonnage mined was constrained by delays in infrastructure construction which has impacted development rates. Key underground infrastructure projects completed include the shotcrete plant and the cemented rockfill plant. Modifications to the secondary crushing circuit were also completed which are expected to increase crusher availability and efficiency.
Removed
Following announcement of the acquisition on July 5, 2022, we advanced $25 million as a loan to Alexco to fund the development of Keno Hill. Since September 7, 2022, we have spent $19.7 million on capital expenditures on Keno Hill development with 1,752 feet developed through December 31, 2022.
Added
Dollars are in thousands (except per ounce and per ton amounts) Year Ended December 31, 2023 Sales $ 35,518 Cost of sales and other direct production costs (31,241 ) Depreciation, depletion and amortization (4,277 ) Total cost of sales (35,518 ) Gross profit $ — Tons of ore milled 56,331 Production: Silver (ounces) 1,502,577 Zinc (tons) 1,139 Lead (tons) 1,225 Payable metal quantities sold: Silver (ounces) 1,419,173 Zinc (tons) 1,102 Lead (tons) 848 Ore grades: Silver ounces per ton 27.7 Zinc percent 2.5 % Lead percent 2.3 % Capital additions $ 44,672 During the year ended December 31, 2023, Keno Hill recorded sales and total cost of sales of $35.5 million, related to the concentrate produced and sold during the ramp up.

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Item 2. Properties

Properties — owned and leased real estate

36 edited+58 added−3 removed30 unchanged
Biggest changeSee footnotes 8 and 9 below. 36 The following table summarizes the in-situ mineral resources (8) for all properties, exclusive of mineral reserves, as of December 31, 2022: Asset Tons (000) Silver (oz/ton) Gold (oz/ton) Lead % Zinc % Copper % Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Copper Tons Measured Resources: (9) Greens Creek (12,13) — — — — — — — — — — — Lucky Friday (12,14) 6,237 7.8 — 5.4 2.6 — 48,551 — 335,850 161,000 — Casa Berardi Underground (12,15) 2,440 — 0.22 — — — — 530 — — — Casa Berardi Open Pit (12,15) 483 — 0.04 — — — — 20 — — — Keno Hill (12,16) — — — — — — — — — — — San Sebastian - Oxide (17) — — — — — — — — — — — San Sebastian - Sulfide (17) — — — — — — — — — — — Fire Creek (18,19) — — — — — — — — — — — Hollister (18,20) 18 4.9 0.59 — — — 87 10 — — — Midas (18,21) 2 7.6 0.68 — — — 14 1 — — — Heva (22) — — — — — — — — — — — Hosco (22) — — — — — — — — — — — Star (12,23) — — — — — — — — — — — Total Measured 9,180 48,652 561 335,850 161,000 — Tons (000) Silver (oz/ton) Gold (oz/ton) Lead% Zinc% Copper% Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Copper Tons Indicated Resources: (10) Greens Creek (12,13) 8,421 12.9 0.10 2.9 8.0 — 108,717 810 245,990 675,740 — Lucky Friday (12,14) 1,194 8.0 — 5.4 2.2 — 9,581 — 64,390 26,200 — Casa Berardi Underground (12,15) 3,870 — 0.17 — — — — 660 — — — Casa Berardi Open Pit (12,15) 1,323 — 0.04 — — — — 48 — — — Keno Hill (12,16) 4,061 8 0.007 1.0 4.0 — 32,288 29 39,540 163,130 — San Sebastian - Oxide (17) 1,453 6.5 0.09 — — — 9,430 135 — — — San Sebastian - Sulfide (17) 1,187 5.5 0.01 1.9 2.9 1.2 6,579 16 22,420 34,100 14,650 Fire Creek (18,19) 112 1.1 0.53 — — — 122 59 — — — Hollister (18,20) 70 1.9 0.58 — — — 130 40 — — — Midas (18,21) 76 5.7 0.42 — — — 430 32 — — — Heva (22) 1,266 — 0.06 — — — — 76 — — — Hosco (22) 29,287 — 0.04 — — — — 1,202 — — — Star (12,23) 1,068 3.0 — 6.4 7.7 — 3,177 — 67,970 82,040 — Total Indicated 53,388 170,454 3,107 440,310 981,210 14,650 Tons (000) Silver (oz/ton) Gold (oz/ton) Lead % Zinc % Copper % Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Copper Tons Measured and Indicated Resources: Greens Creek (12,13) 8,421 12.9 0.10 2.9 8.0 — 108,717 810 245,990 675,740 — Lucky Friday (12,14) 7,431 7.8 — 5.4 2.5 — 58,132 — 400,240 187,200 — Casa Berardi Underground (12,15) 6,310 — 0.19 — — — — 1,190 — — — Casa Berardi Open Pit (12,15) 1,806 — 0.04 — — — — 67 — — — Keno Hill (12,16) 4,061 8.0 0.007 1.0 4.0 — 32,288 29 39,540 163,130 — San Sebastian - Oxide (17) 1,453 6.5 0.09 — — — 9,430 135 — — — San Sebastian - Sulfide (17) 1,187 5.5 0.01 1.9 2.9 1.2 6,579 16 22,420 34,100 14,650 Fire Creek (18,19) 112 1.1 0.53 — — — 122 59 — — — Hollister (18,20) 88 2.5 0.58 — — — 217 51 — — — Midas (18,21) 78 5.7 0.43 — — — 444 33 — — — Heva (22) 1,266 — 0.06 — — — — 76 — — — Hosco (22) 29,287 — 0.04 — — — — 1,202 — — — Star (12,23) 1,068 3.0 — 6.4 7.7 — 3,177 — 67,970 82,040 — Total Measured and Indicated 62,568 219,106 3,668 776,160 1,142,210 14,650 Tons (000) Silver (oz/ton) Gold (oz/ton) Lead % Zinc % Copper % Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Copper Tons Inferred Resources: (11) Greens Creek (12,13) 2,383 12.1 0.07 2.8 6.9 — 28,949 178 67,400 164,080 — Lucky Friday (12,14) 3,592 8.7 — 6.3 2.4 — 31,264 — 224,670 84,700 — Casa Berardi Underground (12,15) 2,221 — 0.19 — — — — 430 — — — Casa Berardi Open Pit (12,15) 7,828 — 0.05 — — — — 389 — — — Keno Hill (12,16) 2,441 10.4 0.003 0.9 2.1 — 25,478 8 22,380 51,000 — San Sebastian - Oxide (17) 3,490 6.4 0.05 — — — 22,353 182 — — — San Sebastian - Sulfide (17) 385 4.2 0.01 1.6 2.3 0.9 1,606 5 6,070 8,830 3,330 Fire Creek (18,19) 765 0.5 0.51 — — — 394 392 — — — Fire Creek - Open Pit (24) 74,584 0.1 0.03 — — — 5,232 2,178 — — — Hollister (18,20) 642 3.0 0.42 — — — 1,916 273 — — — Midas (18,21) 1,232 6.3 0.50 — — — 7,723 615 — — — Heva (22) 2,787 — 0.08 — — — — 216 — — — Hosco (22) 17,726 — 0.04 — — — — 663 — — — Star (12,23) 2,851 3.1 — 5.9 5.9 — 8,795 — 168,180 166,930 — San Juan Silver (12,25) 2,570 11.3 0.01 1.4 1.1 — 38,203 34 49,400 39,850 — Monte Cristo (26) 913 0.3 0.14 — — — 271 131 — — — Rock Creek (12,27) 100,086 1.5 — — — 0.7 148,736 — — — 658,680 Montanore (12,28) 112,185 1.6 — — — 0.7 183,346 — — — 759,420 Total Inferred 338,681 504,266 5,694 538,100 515,390 1,421,430 (8) The term "mineral resources" means a concentration or occurrence of material of economic interest in or on the Earth's crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction.
Biggest changeThe following table summarizes the in-situ mineral resources (8) for all properties, exclusive of mineral reserves, as of December 31, 2023: Asset Tons (000) Silver (oz/ton) Gold (oz/ton) Lead % Zinc % Copper % Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Copper Tons Measured Resources: (9) Greens Creek (12,13) — — — — — — — — — — — Lucky Friday (12,14) 5,326 8.6 — 5.6 2.7 — 45,785 — 299,360 146,420 — Casa Berardi Underground (12,15) 1,099 — 0.21 — — — — 234 — — — Casa Berardi Open Pit (12,15) 67 — 0.03 — — — — 2 — — — Keno Hill (12,16) — — — — — — — — — — — San Sebastian - Oxide (17) — — — — — — — — — — — San Sebastian - Sulfide (17) — — — — — — — — — — — Fire Creek (18,19) — — — — — — — — — — — Hollister (18,20) 18 4.9 0.59 — — — 87 10 — — — Midas (18,21) 2 7.6 0.68 — — — 14 1 — — — Heva (22) — — — — — — — — — — — Hosco (22) — — — — — — — — — — — Star (12,23) — — — — — — — — — — — Tiger Underground (29) 881 — 0.09 — — — — 75 — — — Tiger Open Pit (29) 32 — 0.06 — — — — 2 — — — Osiris Underground (30) — — — — — — — — — — — Osiris Open Pit (30) — — — — — — — — — — — Total Measured 7,425 45,886 324 299,360 146,420 — Tons (000) Silver (oz/ton) Gold (oz/ton) Lead% Zinc% Copper% Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Copper Tons Indicated Resources: (10) Greens Creek (12,13) 8,040 13.9 0.10 3.0 8.0 — 111,526 800 239,250 643,950 — Lucky Friday (12,14) 1,011 8.0 — 6.0 2.7 — 8,136 — 60,200 26,910 — Casa Berardi Underground (12,15) 3,154 — 0.19 — — — — 603 — — — Casa Berardi Open Pit (12,15) 205 — 0.03 — — — — 5 — — — Keno Hill (12,16) 4,504 7.5 0.006 0.9 3.5 — 33,926 26 41,120 157,350 — San Sebastian - Oxide (17) 1,453 6.5 0.09 — — — 9,430 135 — — — San Sebastian - Sulfide (17) 1,187 5.5 0.01 1.9 2.9 1.2 6,579 16 22,420 34,100 14,650 Fire Creek (18,19) 114 1.0 0.46 — — — 113 53 — — — Hollister (18,20) 70 1.9 0.58 — — — 130 40 — — — Midas (18,21) 76 5.7 0.42 — — — 430 32 — — — Heva (22) 1,266 — 0.06 — — — — 76 — — — Hosco (22) 29,287 — 0.04 — — — — 1,202 — — — Star (12,23) 1,068 3.0 — 6.4 7.7 — 3,177 — 67,970 82,040 — Tiger Underground (29) 3,116 — 0.10 — — — — 311 — — — Tiger Open Pit (29) 960 — 0.08 — — — — 76 — — — Osiris Underground (30) 5,135 — 0.12 — — — — 604 — — — Osiris Open Pit (30) 960 — 0.13 — — — — 128 — — — Total Indicated 61,606 173,447 4,107 430,960 944,350 14,650 Tons (000) Silver (oz/ton) Gold (oz/ton) Lead % Zinc % Copper % Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Copper Tons Measured and Indicated Resources: Greens Creek (12,13) 8,040 13.9 0.10 3.0 8.0 — 111,526 800 239,250 643,950 — Lucky Friday (12,14) 6,337 8.3 — 5.8 2.7 — 53,921 — 359,560 173,330 — Casa Berardi Underground (12,15) 4,253 — 0.20 — — — — 837 — — — Casa Berardi Open Pit (12,15) 272 — 0.03 — — — — 7 — — — Keno Hill (12,16) 4,504 7.5 0.006 0.9 3.5 — 33,926 26 41,120 157,350 — San Sebastian - Oxide (17) 1,453 6.5 0.09 — — — 9,430 135 — — — San Sebastian - Sulfide (17) 1,187 5.5 0.01 1.9 2.9 1.2 6,579 16 22,420 34,100 14,650 Fire Creek (18,19) 114 1.0 0.46 — — — 113 53 — — — Hollister (18,20) 88 2.5 0.58 — — — 217 50 — — — Midas (18,21) 78 5.7 0.43 — — — 444 33 — — — Heva (22) 1,266 — 0.06 — — — — 76 — — — Hosco (22) 29,287 — 0.04 — — — — 1,202 — — — Star (12,23) 1,068 3.0 — 6.4 7.7 — 3,177 — 67,970 82,040 — Tiger Underground (29) 3,997 — 0.10 — — — — 386 — — — Tiger Open Pit (29) 992 — 0.08 — — — — 78 — — — Osiris Underground (30) 5,135 — 0.12 — — — — 604 — — — Osiris Open Pit (30) 960 — 0.13 — — — — 128 — — — Total Measured and Indicated 69,031 219,333 4,431 730,320 1,090,770 14,650 Tons (000) Silver (oz/ton) Gold (oz/ton) Lead % Zinc % Copper % Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Copper Tons Inferred Resources: (11) Greens Creek (12,13) 1,930 13.4 0.08 2.9 6.9 — 25,891 154 55,890 133,260 — Lucky Friday (12,14) 3,600 7.8 — 5.9 2.8 — 27,934 — 211,340 100,630 — Casa Berardi Underground (12,15) 1,475 — 0.22 — — — — 332 — — — Casa Berardi Open Pit (12,15) 828 — 0.08 — — — — 64 — — — Keno Hill (12,16) 2,836 11.2 0.003 1.1 1.8 — 31,791 9 32,040 51,870 — San Sebastian - Oxide (17) 3,490 6.4 0.05 — — — 22,353 182 — — — San Sebastian - Sulfide (17) 385 4.2 0.01 1.6 2.3 0.9 1,606 5 6,070 8,830 3,330 Fire Creek (18,19) 764 0.5 0.51 — — — 393 392 — — — Fire Creek - Open Pit (24) 74,584 0.1 0.03 — — — 5,232 2,178 — — — Hollister (18,20) 642 3.0 0.42 — — — 1,916 273 — — — 39 Midas (18,21) 1,232 6.3 0.50 — — — 7,723 615 — — — Heva (22) 2,787 — 0.08 — — — — 216 — — — Hosco (22) 17,726 — 0.04 — — — — 663 — — — Star (12,23) 2,851 3.1 — 5.9 5.9 — 8,795 — 168,180 166,930 — San Juan Silver (12,25) 2,570 14.9 0.01 1.4 1.1 — 38,203 34 49,400 39,850 — Monte Cristo (26) 913 0.3 0.14 — — — 271 131 — — — Rock Creek (12,27) 100,086 1.5 — — — 0.7 148,736 — — — 658,680 Libby Exploration (12,28) 112,185 1.6 — — — 0.7 183,346 — — — 759,420 Tiger Underground (29) 30 — 0.05 — — — — 2 — — — Tiger Open Pit (29) 152 — 0.07 — — — — 10 — — — Osiris Underground (30) 5,919 — 0.09 — — — — 530 — — — Osiris Open Pit (30) 4,398 — 0.12 — — — — 514 — — — Total Inferred 341,383 504,190 6,304 522,920 501,370 1,421,430 (8) The term "mineral resources" means a concentration or occurrence of material of economic interest in or on the Earth's crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction.
Three flotation concentrates are produced: a silver concentrate which contains most of the silver recovered; a zinc concentrate which is low in precious metals content; and a zinc-rich precious metals concentrate that contains gold, silver, zinc, and lead and must be marketed to a smelter utilizing an Imperial Smelting Furnace (ISF) which can simultaneously produce 39 both zinc and lead.
Three flotation concentrates are produced: a silver concentrate which contains most of the silver recovered; a zinc concentrate which is low in precious metals content; and a zinc-rich precious metals concentrate that contains gold, silver, zinc, and lead and must be marketed to a smelter utilizing an Imperial Smelting Furnace (ISF) which can simultaneously produce both zinc and lead.
The map below illustrates the location and access to Greens Creek: Greens Creek is an underground mine accessed by a ramp from surface which produces approximately 2,300 tons of ore per day. The primary mining methods are cut and fill and longhole stoping.
The map below illustrates the location and access to Greens Creek: Greens Creek is an underground mine accessed by a ramp from surface which produces approximately 2,300 to 2,600 tons of ore per day. The primary mining methods are cut and fill and longhole stoping.
Metallurgical recoveries: 90% for gold and 70% for silver. A gold-equivalent cut-off grade of 0.1 oz/ton and a gold price of $1,700/oz used for Sinter Zone with resources undiluted. (22) Measured, indicated and inferred resources at Heva and Hosco are based on $1,500/oz for gold.
Metallurgical recoveries: 90% for gold and 70% for silver. A gold-equivalent cut-off grade of 0.1 oz/ton and a gold price of $1,700/oz used for Sinter Zone with resources undiluted. 40 (22) Measured, indicated and inferred resources at Heva and Hosco are based on $1,500/oz for gold.
Because a measured mineral resource has a higher level of confidence than the level of confidence 37 of either an indicated mineral resource or an inferred mineral resource, a measured mineral resource may be converted to a proven mineral reserve or to a probable mineral reserve.
Because a measured mineral resource has a higher level of confidence than the level of confidence of either an indicated mineral resource or an inferred mineral resource, a measured mineral resource may be converted to a proven mineral reserve or to a probable mineral reserve.
Doré is produced from the gravity concentrate by a third-party processor and further refined and sold to precious metal traders. The concentrate products are sold to a number of smelters and traders worldwide. See Note 3 of Notes to Consolidated Financial Statements for information on the significant customers for Greens Creek’s products.
Doré is produced from the gravity concentrate by a third-party processor and further refined and sold to precious metal traders. The concentrate products are sold to a number of smelters and traders worldwide. See Note 4 of Notes to Consolidated Financial Statements for information on the significant customers for Greens Creek’s products.
Some State permits in-place; no Federal permits. Exploration Underground Ag, Cu Sediment Hosted - Stratabound Montanore United States Montana 100.0 % 2 patented lode claims, 36.84 acres (22.33 in wilderness, 14.51 outside wilderness) Private or USFS administered land. Some State permits in-place; no Federal permits.
Some State permits in-place; no Federal permits. Exploration Underground Ag, Cu Sediment Hosted - Stratabound Libby Exploration United States Montana 100.0 % 2 patented lode claims, 36.84 acres (22.33 in wilderness, 14.51 outside wilderness) Private or USFS administered land. Some State permits in-place; no Federal permits.
Resources adjusted based on mining restrictions as defined by USFS, Kootenai National Forest in the June 2003 'Record of Decision, Rock Creek Project'. (28) Inferred resource at Montanore reported at a minimum thickness of 15 feet and an NSR cut-off value of $24.50/ton; Metallurgical recoveries: 88% for silver and 92% for copper.
(27) Inferred resource at Rock Creek reported at a minimum thickness of 15 feet and an NSR cut-off value of $24.50/ton; Metallurgical recoveries: 88% for silver and 92% for copper. Resources adjusted based on mining restrictions as defined by USFS, Kootenai National Forest in the June 2003 'Record of Decision, Rock Creek Project'.
A reconciliation of cost of sales and other direct production costs and depreciation, depletion and amortization, the most comparable GAAP measure, to these non-GAAP measures can be found in
A reconciliation of cost of sales and other direct production costs and depreciation, depletion and amortization, the most comparable GAAP measure, to these non-GAAP measures can be found in Item 7.
Metallurgical recovery (actual 2022): 87% for gold; US$/CAN$ exchange rate: 1:1.3. (6) Due to multiple ore metals, and complex combinations of ore types, metal ratios and metallurgical performances at Keno Hill, the cutoff grade is expressed in terms of NSR, rather than metal grade.
Metallurgical recovery (actual 2023): 85% for gold; US$/CAN$ exchange rate: 1:1.3. (6) Due to multiple ore metals, and complex combinations of ore types, metal ratios and metallurgical performances at Keno Hill, the cutoff grade is expressed in terms of NSR, rather than metal grade.
See Item 1A, Risk Factors . 32 Sum mary The map below shows the locations of our operations and our exploration projects, as well as our corporate offices located in Coeur d’Alene, Idaho; Vancouver, British Columbia; Juneau, Alaska; Wallace, Idaho; Val d'Or, Quebec; Durango, Mexico and Whitehorse, Yukon. 33 The following table summarizes our aggregate metal quantities produced and sold for the last three years: Year Ended December 31, 2022 2021 2020 Silver - Ounces produced 14,182,987 12,887,240 13,542,957 Payable ounces sold 12,311,595 11,633,802 12,305,917 Gold - Ounces produced 175,807 201,327 208,962 Payable ounces sold 165,818 201,610 202,694 Lead - Tons produced 48,713 43,010 34,127 Payable tons sold 41,423 36,707 29,108 Zinc - Tons produced 64,748 63,617 63,112 Payable tons sold 43,658 43,626 46,349 34 A summary overview of mining operations and exploration and pre-development projects is shown in the following table: Location Property Country State/Province Ownership Claims Permit Conditions Stage Mine Type Commodity Mineralization Style Greens Creek United States Alaska 100.0 % 440 unpatented lode claims, 58 unpatented millsite claims (8,072 acres), 17 patented lode claims and one patented millsite claim (328 acres); Land Exchange Properties (7,301 acres) Private or USFS administered land, all required permits for production in place Production Underground Ag, Au, Pb, Zn Massive Sulfide Lucky Friday United States Idaho 100.0 % 43 patented lode and millsite claims (710 acres); 53 unpatented lode claims (535 acres) Private or USFS administered land, all required permits for production in place Production Underground Ag, Pb, Zn Vein Casa Berardi Canada Quebec 100.0 % 394 claims; 48,704 acres (19,710 ha) All required permits for production in place or in process Production Underground/Open Pit Au Vein/Shear Zone Keno Hill Canada Yukon 100.0 % 703 quartz mining leases, 867 quartz mining claims, 2 Crown Grants; (238.12 km 2 / 23,812 ha) All required permits for production in place or in process Development Underground Ag, Au, Pb, Zn Vein/Fault Zone San Sebastian Mexico Durango 100.0 % 31 mining concessions; 99,643 acres (40,324 ha) All required permits for exploration in place Exploration Underground/Open Pit Ag, Au, Cu, Pb, Zn Vein Fire Creek United States Nevada 100.0 % 890 unpatented lode claims (18,400 acres); leases (409 acres); private land (3,208 acres) BLM administered land, Plan of Operations and other required State permits in place Exploration Underground Au, Ag Vein Hollister United States Nevada 100.0 % 1,005 unpatented lode claims, 11 unpatented mill site claims; 17,960 acres total BLM administered land, Plan of Operations and other required State permits in place Exploration Underground Au, Ag Vein Midas United States Nevada 100.0 % 1,489 unpatented lode claims (27,583 acres); private land (2,417 acres) BLM administered land, Plan of Operations and other required State permits in place Exploration Underground Au, Ag Vein Heva - Hosco Canada Quebec 100.0 % 102 claims; 9,506 acres (3,857 ha) Annual intervention permits for exploration in place along with authorization for road building Exploration Underground/Open Pit Au Vein/Shear Zone San Juan Silver United States Colorado 100.0 % 131 patented lode or millsite claims, 704 unpatented lode claims; 13,645 total acres 7 Notice-of-Intent areas for Exploration, Mining Plan of Operations (USFS); 112-d2 mining permit (CO DRMS) Exploration Underground Ag, Pb, Zn Vein Star United States Idaho 100.0 % 174 patented lode and millsite claims; 2,376 total acres Private land, required permits in place for exploration Exploration Underground Ag, Zn, Pb Vein Monte Cristo United States Nevada 100.0 % 344 unpatented lode claims (6,880 acres) BLM administered land, Notice of Intent required Exploration Underground/Open Pit Au, Ag Vein Rock Creek United States Montana 100.0 % 99 patented lode claims, 463 unpatented lode claims, 5 tunnel sites: 1,809 total acres; Private land: 754 acres Private or USFS administered land.
See Item 1A, Risk Factors . 34 Sum mary The map below shows the locations of our operations and our exploration projects, as well as our corporate offices located in Coeur d’Alene, Idaho; Vancouver, British Columbia; Juneau, Alaska; Wallace, Idaho; Val d'Or, Quebec; Durango, Mexico and Whitehorse, Yukon. 35 The following table summarizes our aggregate metal quantities produced and sold for the last three years: Year Ended December 31, 2023 2022 2021 Silver - Ounces produced 14,342,863 14,182,987 12,887,240 Payable ounces sold 12,955,006 12,311,595 11,633,802 Gold - Ounces produced 151,259 175,807 201,327 Payable ounces sold 141,602 165,818 201,610 Lead - Tons produced 40,347 48,713 43,010 Payable tons sold 35,429 41,423 36,707 Zinc - Tons produced 60,579 64,748 63,617 Payable tons sold 43,050 43,658 43,626 36 A summary overview of our mining operations and exploration and pre-development projects is shown in the following table: Location Property Country State/Province Ownership Claims Permit Conditions Stage Mine Type Commodity Mineralization Style Greens Creek United States Alaska 100.0 % 440 unpatented lode claims, 58 unpatented millsite claims (8,072 acres), 21 patented lode claims and one patented millsite claim (328 acres); Land Exchange Properties (7,301 acres) Private or USFS administered land, all required permits for production in place Production Underground Ag, Au, Pb, Zn Massive Sulfide Lucky Friday United States Idaho 100.0 % 43 patented lode and millsite claims (710 acres); 53 unpatented lode claims (535 acres) Private or USFS administered land, all required permits for production in place Production Underground Ag, Pb, Zn Vein Casa Berardi Canada Quebec 100.0 % 394 claims; 48,704 acres (19,710 ha) All required permits for production in place or in process Production Underground/Open Pit Au Vein/Shear Zone Keno Hill Canada Yukon 100.0 % 703 quartz mining leases, 867 quartz mining claims, 2 Crown Grants; (238.12 km 2 / 23,812 ha) All required permits for production in place or in process Development Underground Ag, Au, Pb, Zn Vein/Fault Zone San Sebastian Mexico Durango 100.0 % 31 mining concessions; 99,643 acres (40,324 ha) All required permits for exploration in place Exploration Underground/Open Pit Ag, Au, Cu, Pb, Zn Vein Fire Creek United States Nevada 100.0 % 890 unpatented lode claims (18,400 acres); leases (409 acres); private land (3,208 acres) BLM administered land, Plan of Operations and other required State permits in place Exploration Underground Au, Ag Vein Hollister United States Nevada 100.0 % 1,005 unpatented lode claims, 11 unpatented mill site claims; 17,960 acres total BLM administered land, Plan of Operations and other required State permits in place Exploration Underground Au, Ag Vein Midas United States Nevada 100.0 % 1,489 unpatented lode claims (27,583 acres); private land (2,417 acres) BLM administered land, Plan of Operations and other required State permits in place Exploration Underground Au, Ag Vein Heva - Hosco Canada Quebec 100.0 % 102 claims; 9,506 acres (3,857 ha) Annual intervention permits for exploration in place along with authorization for road building Exploration Underground/Open Pit Au Vein/Shear Zone San Juan Silver United States Colorado 100.0 % 131 patented lode or millsite claims, 704 unpatented lode claims; 13,645 total acres 7 Notice-of-Intent areas for Exploration, Mining Plan of Operations (USFS); 112-d2 mining permit (CO DRMS) Exploration Underground Ag, Pb, Zn Vein Star United States Idaho 100.0 % 174 patented lode and millsite claims; 2,376 total acres Private land, required permits in place for exploration Exploration Underground Ag, Zn, Pb Vein Monte Cristo United States Nevada 100.0 % 344 unpatented lode claims (6,880 acres) BLM administered land, Notice of Intent required Exploration Underground/Open Pit Au, Ag Vein Rock Creek United States Montana 100.0 % 99 patented lode claims, 463 unpatented lode claims, 5 tunnel sites: 1,809 total acres; Private land: 754 acres Private or USFS administered land.
(26) Inferred resource at Monte Cristo reported at a minimum mining width of 5.0 feet; resources based on $1,400/oz for gold, $26.50/oz for silver using a 0.06 oz/ton gold cut-off grade.
(26) Inferred resource at Monte Cristo reported at a minimum mining width of 5.0 feet; resources based on $1,400/oz for gold, $26.50/oz for silver using a 0.06 oz/ton gold cut-off grade. Metallurgical recovery: 90% for gold and 90% for silver.
You are cautioned that mineral resources do not have demonstrated economic value. Mineral resources are subject to further exploration and development, are subject to additional risks, and no assurance can be given that they will eventually convert to future reserves. Inferred Resources, in particular, have a great amount of uncertainty as to their existence and their economic and legal feasibility.
Mineral resources are subject to further exploration and development, are subject to additional risks, and no assurance can be given that they will eventually convert to future reserves. Inferred Resources, in particular, have a great amount of uncertainty as to their existence and their economic and legal feasibility.
(14) The resource NSR cut-off values for Lucky Friday are $200.57 for the 30 Vein, $227.90 for the Intermediate Veins and $198.48 for the Lucky Friday Vein; metallurgical recoveries (actual 2022): 95% for silver, 95% for lead, and 88% for zinc.
(14) The resource NSR cut-off values for Lucky Friday are $200.57 for the 30 Vein, $227.90 for the Intermediate Veins and $198.48 for the Lucky Friday Vein; metallurgical recoveries (actual 2023): 96% for silver, 95% for lead, and 85% for zinc.
The current mine plan at Greens Creek utilizes estimates of reserves and resources for approximately 12 years of production, through 2034.
The current mine plan at Greens Creek utilizes estimates of reserves and resources for approximately 14 years of production, through 2037.
(25) Inferred resources reported at a minimum mining width of 6.0 feet for Bulldog and an NSR cut-off value of $175/ton and 5.0 feet for Equity and North Amethyst veins at an NSR cut-off value of $100/ton; based on $1,400/oz for gold, $26.50/oz for silver, $0.85/lb for lead, and $0.85/lb for zinc.
(25) Inferred resources reported at a minimum mining width of 6.0 feet for Bulldog and an NSR cut-off value of $175/ton and 5.0 feet for Equity and North Amethyst veins at an NSR cut-off value of $100/ton; based on $1,700/oz for gold, $21.00/oz for silver, $1.15/lb for lead, and $1.35/lb for zinc.
See footnotes 7 and 8 below. (2) Mineral reserves are based on the following prices unless otherwise stated: $17.00/oz for silver, $1,600/oz for gold, $0.90/lb for lead and $1.15/lb for zinc. All Mineral Reserves are reported in-situ with estimates of mining dilution and mining loss.
See footnotes 7 and 8 below. (2) Mineral reserves are based on the following prices unless otherwise stated: $17.00/oz for silver, $1,650/oz for gold, $0.90/lb for lead and $1.15/lb for zinc. Underground mineral reserves at Casa Berardi were based on a gold price of $1,850/oz. All Mineral Reserves are reported in-situ with estimates of mining dilution and mining loss.
The reserve NSR cut-off value at Keno Hill is $244.24/ton (CAN$350/tonne), Metallurgical recovery: 93% for silver, 25% for gold, 93% for lead, 72% for zinc; US$/CAN$ exchange rate: 1:1.3. (7) The term “probable reserves” means the economically mineable part of an indicated and, in some cases, a measured mineral resource.
The reserve NSR cut-off value at Keno Hill is $244.24/ton (CAN$350/tonne), Metallurgical recovery: (actual 2023) 96% for silver, 93% for lead, 81% for zinc; US$/CAN$ exchange rate: 1:1.3. (7) The term “probable reserves” means the economically mineable part of an indicated and, in some cases, a measured mineral resource. See footnotes 8 and 9 below.
The reserve NSR cut-off values for Lucky Friday are $241.34 for the 30 Vein and $268.67 for the Intermediate Veins; metallurgical recoveries (actual 2022): 95% for silver, 95% for lead, and 88% for zinc. (5) The average reserve cut-off grades at Casa Berardi are 0.12 oz/ton gold underground and 0.04 oz/ton gold for open pit.
The reserve NSR cut-off values for Lucky Friday are $241.34 for the 30 Vein and $268.67 for the Intermediate Veins; metallurgical recoveries (actual 2023): 96% for silver, 95% for lead, and 85% for zinc. 38 (5) The average reserve cut-off grades at Casa Berardi are 0.11 oz/ton gold underground and 0.03 oz/ton gold for open pit.
See Note 3 of Notes to Consolidated Financial Statements and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations - Greens Creek for information on its financial performance.
See Note 4 of Notes to Consolidated Financial Statements and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations - Lucky Friday for information on its financial performance.
(13) The resource NSR cut-off values for Greens Creek are $210/ton for all zones except the Gallagher Zone at $215/ton; metallurgical recoveries (actual 2022): 81% for silver, 72% for gold, 82% for lead, and 89% for zinc.
(2) The resource NSR cut-off grades for Greens Creek are $230/ton for all zones except the Gallagher Zone at $235/ton; metallurgical recoveries (actual 2022): 81% for silver, 72% for gold, 82% for lead and 89% for zinc.
(15) The average resource cut-off grades at Casa Berardi are 0.11 oz/ton gold for underground and 0.034 oz/ton gold for open pit; metallurgical recovery (actual 2022): 87% for gold; US$/CAN$ exchange rate: 1:1.3.
(15) The average resource cut-off grades at Casa Berardi are 0.12 oz/ton gold for underground and 0.03 oz/ton gold for open pit; metallurgical recovery (actual 2023) 85% for gold; US$/CAN$ exchange rate: 1:1.3.
Exploration Underground Ag, Cu Sediment Hosted - Stratabound Republic United States Washington 100.0 % 114 patented claims and private land; 2,095 acres surface rights, 3,177 acres of mineral rights Private or BLM administered land Exploration Underground/Open Pit Au, Ag Vein Silver Valley United States Idaho 100.0 % Various exploration properties and claim holdings Private or USFS administered land Exploration Underground Ag, Zn, Pb Vein Aurora United States Nevada 100.0 % 506 unpatented lode claims, 92 patented lode claims, 25 private parcels; 9,928 total acres Private or USFS administered land, permit work in progress for USFS lands Exploration Underground/Open Pit Au, Ag Vein Kinskuch Canada British Columbia 100.0 % 156 claims; 146,780 acres Multi-use area-based permit with expiry 31 March 2024 Exploration Underground/Open Pit Au, Ag, Cu, Pb, Zn Vein, Massive Sulfide, Porphyry Opinaca/Wildcat Canada Quebec 50% / 100% Opinaca: 248 claims (50%; 32,064 acres (12,976 ha)); Wildcat: 235 claims (100%; 30,528 acres (12,354 ha)) Intervention permits for exploration updated every year Exploration Underground Au Vein/Shear Zone 35 Hecla is the operator at all mines and exploration properties.
Exploration Underground Ag, Cu Sediment Hosted - Stratabound Republic United States Washington 100.0 % 114 patented claims and private land; 2,095 acres surface rights, 3,177 acres of mineral rights Private or BLM administered land Exploration Underground/Open Pit Au, Ag Vein Silver Valley United States Idaho 100.0 % Various exploration properties and claim holdings Private or USFS administered land Exploration Underground Ag, Zn, Pb Vein Aurora United States Nevada 100.0 % 506 unpatented lode claims, 92 patented lode claims, 25 private parcels; 9,928 total acres Private or USFS administered land, permit work in progress for USFS lands Exploration Underground/Open Pit Au, Ag Vein Kinskuch Canada British Columbia 100.0 % 156 claims; 146,780 acres Multi-use area-based permit with expiry 31 March 2024 Exploration Underground/Open Pit Au, Ag, Cu, Pb, Zn Vein, Massive Sulfide, Porphyry 37 Opinaca/Wildcat Canada Quebec 50% / 100% Opinaca: 248 claims (50%; 32,064 acres (12,976 ha)); Wildcat: 235 claims (100%; 30,528 acres (12,354 ha)) Intervention permits for exploration updated every year Exploration Underground Au Vein/Shear Zone Rackla - Tiger Canada Yukon 100.0 % 3,315 quartz mineral claims; 164,547 acres (66,590 ha) Class 3 Quartz Mining Land Use Approval LQ00531; approved by Yukon Environmental and Socio-economic Assessment Board Exploration Open Pit/Undergournd Au Carbonate hosted/replacement - reduced intrusion related Rackla - Osiris Canada Yukon 100.0% 1,478 quartz mineral claims; 74,576 acres (30,180 ha) Class 4 Quartz Mining Land Use Approval LQ00444; approved by Yukon Environmental and Socio-economic Assessment Board Exploration Open Pit/Undergournd Au Carbonate hosted, dissemintated (Carlin-style) Hecla is the operator at all mines and exploration properties.
The reserve NSR cut-off values for Greens Creek are $210/ton for all zones except the Gallagher Zone at $215/ton; metallurgical recoveries (actual 2022): 81% for silver, 72% for gold, 82% for lead, and 89% for zinc.
The reserve NSR cut-off values for Greens Creek are $230/ton for all zones except the Gallagher Zone at $235/ton; metallurgical recoveries (actual 2023): 80% for silver, 74% for gold, 82% for lead, and 89% for zinc.
The net book value of the Greens Creek property and its associated plant, equipment and mineral interests was approximately $529.3 million as of December 31, 2022. The vintage of the facilities at Greens Creek ranges from the 1980s to 2022.
The net book value of the Lucky Friday property and its associated plant, equipment and mineral interests was approximately $562.3 million as of December 31, 2023. The vintage of the facilities at Lucky Friday ranges from the 1950s to 2023.
Information with respect to Greens Creek's production, total cost of sales, average Cash Cost, After By-product Credits, Per Silver Ounce, All-In Sustaining Costs (“AISC”), After By-product Credits, Per Silver Ounce, and proven and probable mineral reserves for the past three years is set forth in the following table. 40 Years Ended December 31, Production 2022 2021 2020 Ore milled (tons) 881,445 841,967 818,408 Silver (ounces) 9,741,935 9,243,222 10,494,726 Gold (ounces) 48,216 46,088 48,491 Zinc (tons) 52,312 53,648 56,814 Lead (tons) 19,480 19,873 21,400 Total cost of sales $ 232,719 $ 213,113 $ 210,748 Cash Cost, After By-product Credits, Per Silver Ounce (1) $ 0.70 $ (0.65 ) $ 4.88 AISC, After By-Product Credits, per Silver Ounce (1) $ 5.77 $ 3.19 $ 7.97 Proven Mineral Reserves (2,3,4,5) Total tons 6,700 1,900 3,200 Silver (ounces per ton) 16.1 9.6 21.8 Gold (ounces per ton) 0.07 0.08 0.10 Zinc (percent) 5.4 4.5 7.8 Lead (percent) 2.3 1.7 3.7 Contained silver (ounces) 107,500 17,900 70,100 Contained gold (ounces) 400 100 300 Contained zinc (tons) 360 80 250 Contained lead (tons) 150 30 120 Probable Mineral Reserves (2,3,4,5) Total tons 10,667,600 11,073,800 8,975,100 Silver (ounces per ton) 10.9 11.3 12.4 Gold (ounces per ton) 0.09 0.09 0.09 Zinc (percent) 6.5 6.6 7.3 Lead (percent) 2.5 2.5 2.8 Contained silver (ounces) 116,748,100 125,200,900 111,333,300 Contained gold (ounces) 934,700 945,600 827,300 Contained zinc (tons) 694,800 725,830 652,170 Contained lead (tons) 264,600 282,220 254,840 Total Proven and Probable Mineral Reserves (2,3,4,5) 0 10,674,300 11,075,700 8,978,300 Silver (ounces per ton) 11.0 11.3 12.4 Gold (ounces per ton) 0.09 0.09 0.09 Zinc (percent) 6.5 6.6 7.3 Lead (percent) 2.5 2.5 2.8 Contained silver (ounces) 116,855,600 125,218,800 111,403,400 Contained gold (ounces) 935,100 945,700 827,600 Contained zinc (tons) 695,160 725,910 652,420 Contained lead (tons) 264,750 282,250 254,960 (1) Includes by-product credits from gold, lead and zinc production.
Information with respect to Greens Creek's production, total cost of sales, average Cash Cost, After By-product Credits, Per Silver Ounce, All-In Sustaining Costs (“AISC”), After By-product Credits, Per Silver Ounce, and proven and probable mineral reserves for the past three years is set forth in the following table. 42 Years Ended December 31, Production 2023 2022 2021 Ore milled (tons) 914,796 881,445 841,967 Silver (ounces) 9,731,752 9,741,935 9,243,222 Gold (ounces) 60,896 48,216 46,088 Zinc (tons) 51,496 52,312 53,648 Lead (tons) 19,578 19,480 19,873 Total cost of sales $ 259,895 $ 232,718 $ 213,113 Cash Cost, After By-product Credits, Per Silver Ounce (1) $ 2.53 $ 0.70 $ (0.65 ) AISC, After By-Product Credits, per Silver Ounce (1) $ 7.14 $ 5.17 $ 2.70 Proven Mineral Reserves (2,3,4,5) Total tons 8,800 6,700 1,900 Silver (ounces per ton) 11.3 16.1 9.6 Gold (ounces per ton) 0.08 0.07 0.08 Zinc (percent) 8.4 5.4 4.5 Lead (percent) 3.5 2.3 1.7 Contained silver (ounces) 99,500 107,500 17,900 Contained gold (ounces) 700 400 100 Contained zinc (tons) 740 360 80 Contained lead (tons) 310 150 30 Probable Mineral Reserves (2,3,4,5) Total tons 10,008,900 10,667,600 11,073,800 Silver (ounces per ton) 10.5 10.9 11.3 Gold (ounces per ton) 0.09 0.09 0.09 Zinc (percent) 6.6 6.5 6.6 Lead (percent) 2.5 2.5 2.5 Contained silver (ounces) 105,121,700 116,748,100 125,200,900 Contained gold (ounces) 879,700 934,700 945,600 Contained zinc (tons) 657,990 694,800 725,830 Contained lead (tons) 250,270 264,600 282,220 Total Proven and Probable Mineral Reserves (2,3,4,5) Total tons 10,017,700 10,674,300 11,075,700 Silver (ounces per ton) 10.5 11.0 11.3 Gold (ounces per ton) 0.09 0.09 0.09 Zinc (percent) 6.6 6.5 6.6 Lead (percent) 2.5 2.5 2.5 Contained silver (ounces) 105,221,200 116,855,600 125,218,800 Contained gold (ounces) 880,400 935,100 945,700 Contained zinc (tons) 658,730 695,160 725,910 Contained lead (tons) 250,580 264,750 282,250 (1) Includes by-product credits from gold, lead and zinc production.
Item 2. Properties Note on New SEC Mining Disclosure Rules Information concerning our mining properties in this Annual Report on Form 10-K has been prepared in accordance with the requirements of subpart 1300 of Regulation S-K, which first became applicable to us for the fiscal year ended December 31, 2021.
Item 2. Properties Note on SEC Mining Disclosure Rules Information concerning our mining properties in this Annual Report on Form 10-K has been prepared in accordance with the requirements of subpart 1300 of Regulation S-K.
Metallurgical recovery: 90% for gold and 90% for silver. 38 (27) Inferred resource at Rock Creek reported at a minimum thickness of 15 feet and an NSR cut-off value of $24.50/ton; Metallurgical recoveries: 88% for silver and 92% for copper.
(28) Inferred resource at the Libby Exploration project reported at a minimum thickness of 15 feet and an NSR cut-off value of $24.50/ton; Metallurgical recoveries: 88% for silver and 92% for copper.
(12) Mineral resources are based on $1,700/oz for gold, $21.00/oz for silver, $1.15/lb for lead, $1.35/lb for zinc and $3.00/lb for copper, unless otherwise stated. Mineral resources are reported in-situ and are exclusive of mineral reserves. Mineral resources are reported for all resource projects regardless of the percentage of total measured and indicated resource.
(12) Mineral resources for operating properties are based on $1,750/oz for gold, $21.00/oz for silver, $1.15/lb for lead, $1.35/lb for zinc and $3.00/lb for copper, unless otherwise stated. Mineral resources for non-operating resource projects are based on $1,700/oz for gold, $21.00/oz for silver, $1.15/lb for lead, $1.35/lb for zinc and $3.00/lb for copper, unless otherwise stated.
(16) The resource NSR cut-off value at Keno Hill is $129.10/ton (CAN$185/tonne); using minimum width of 4.9 feet (1.5m); metallurgical recovery: 93% for silver, 25% for gold, 93% for lead, 72% for zinc; US$/CAN$ exchange rate: 1:1.3 (17) Indicated resources for most zones at San Sebastian based on $1500/oz gold, $21/oz silver, $1.15/lb lead, $1.35/lb zinc and $3.00/lb copper using an NSR cut-off value of $90.72/ton ($100/tonne); $1700/oz gold used for Toro, Bronco, and Tigre zones.
(17) Indicated resources for most zones at San Sebastian based on $1,500/oz gold, $21.00/oz silver, $1.15/lb lead, $1.35/lb zinc and $3.00/lb copper using an NSR cut-off value of $90.72/ton ($100/tonne); $1,700/oz gold used for Toro, Bronco, and Tigre zones.
In addition, the Greens Creek site includes properties under lease from the USFS for a road right-of-way, mine waste area and tailings storage facility. The USFS leases have varying expiration terms. Greens Creek also has title to mineral rights on 7,301 acres of federal land acquired through a land exchange with the USFS.
The Greens Creek property includes 440 unpatented lode mining claims, 58 unpatented millsite claims, 21 patented lode claims and one patented millsite. In addition, the Greens Creek site includes properties under lease from the USFS for a road right-of-way, mine waste area and tailings storage facility. The USFS leases have varying expiration terms.
These requirements differ significantly from the previously applicable disclosure requirements of SEC Industry Guide 7. Among other differences, subpart 1300 of Regulation S-K requires us to disclose our mineral resources, in addition to our mineral reserves, as of the end of our most recently completed fiscal year both in the aggregate and for each of our individually material mining properties.
Subpart 1300 requires us to disclose our mineral resources, in addition to our mineral reserves, as of the end of our most recently completed fiscal year both in the aggregate and for each of our individually material mining properties. You are cautioned that mineral resources do not have demonstrated economic value.
We are currently exploring, but not mining, on such federal land. The claims and leases above comprise a total area of approximately 24 square miles. Greens Creek consists of the mine, an ore concentrating mill, a tailings storage area, a ship-loading facility, camp facilities, a ferry dock, and other related infrastructure.
Greens Creek also has title to mineral rights on 7,301 acres of federal land acquired through a land exchange with the USFS. We are currently exploring, but not mining, on such federal land. The claims and leases above comprise a total area of approximately 24 square miles.
The employees at Greens Creek are employees of Hecla Greens Creek Mining Company, our wholly-owned subsidiary, and are not represented by a bargaining agent. There were 491 employees at Greens Creek at December 31, 2022. Underground definition and exploration drilling during 2022 focused on seven of the nine known mineralized zones on the property.
The employees at Greens Creek are employees of Hecla Greens Creek Mining Company, our wholly-owned subsidiary, and are not represented by a bargaining agent. There were 512 employees at Greens Creek at December 31, 2023. As of December 31, 2023, we have recorded a $39.9 million asset retirement obligation for reclamation and closure costs.
The following table summarizes the in-situ mineral reserves for all properties as of December 31, 2022: Asset Tons (000) Silver (oz/ton) Gold (oz/ton) Lead % Zinc % Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Proven Reserves: (1) Greens Creek (2,3) 7 16.1 0.07 2.3 5.4 108 0.4 150 360 Lucky Friday (2,4) 4,734 13.8 — 8.6 3.7 64,638 — 404,160 174,510 Casa Berardi Underground (2,5) 552 — 0.17 — — — 95 — — Casa Berardi Open Pit (2,5) 4,410 — 0.09 — — — 417 — — Keno Hill (2,6) — — — — — — — — — Total Proven 9,703 64,746 512 404,310 174,870 Probable Reserves: (7) Greens Creek (2,3) 10,668 10.9 0.09 2.5 6.5 116,748 935 264,600 694,800 Lucky Friday (2,4) 840 12.8 — 8.1 3.2 9,978 — 63,510 25,030 Casa Berardi Underground (2,5) 989 — 0.17 — — — 166 — — Casa Berardi Open Pit (2,5) 12,434 — 0.08 — — — 936 — — Keno Hill (2,6) 2,197 22.5 0.01 2.4 2.2 49,473 13 52,520 49,320 Total Probable 27,128 176,199 2,050 380,630 769,150 Proven and Probable Reserves: (1,7) Greens Creek (2,3) 10,675 10.9 0.09 2.5 6.5 116,856 935 — 264,750 — 695,160 Lucky Friday (2,4) 5,574 13.4 — 8.4 3.6 74,616 — — 467,670 — 199,540 Casa Berardi Underground (2,5) 1,541 — 0.17 — — — 261 — — — — Casa Berardi Open Pit (2,5) 16,844 — 0.08 — — — 1,353 — — Keno Hill (2,6) 2,197 22.5 0.01 2.4 2.2 49,473 13 52,520 49,320 Total Proven and Probable 36,831 240,945 2,562 784,940 944,020 (1) The term “reserve” means an estimate of tonnage and grade or quality of indicated and measured mineral resources that, in the opinion of the qualified person, can be the basis of an economically viable project.
The following table summarizes the in-situ mineral reserves for all properties as of December 31, 2023: Asset Tons (000) Silver (oz/ton) Gold (oz/ton) Lead % Zinc % Silver (000 oz) Gold (000 oz) Lead Tons Zinc Tons Proven Reserves: (1) Greens Creek (2,3) 9 11.3 0.08 3.5 8.4 100 1 310 740 Lucky Friday (2,4) 5,299 12.8 — 8.0 3.8 67,595 — 424,080 201,280 Casa Berardi Underground (2,5) 55 — 0.12 — — — 7 — — Casa Berardi Open Pit (2,5) 4,240 — 0.09 — — — 379 — — Keno Hill (2,6) — — — — — — — — — Total Proven 9,603 67,695 387 424,390 202,020 Probable Reserves: (7) Greens Creek (2,3) 10,009 10.5 0.09 2.5 6.6 105,122 880 250,270 657,990 Lucky Friday (2,4) 966 10.8 — 7.1 2.9 10,411 — 68,320 28,100 Casa Berardi Underground (2,5) 175 — 0.15 — — — 26 — — Casa Berardi Open Pit (2,5) 11,384 — 0.08 — — — 859 — — Keno Hill (2,6) 2,069 26.6 0.01 2.8 2.5 55,068 13 58,170 52,380 Total Probable 24,603 170,601 1,778 376,760 738,470 Proven and Probable Reserves: (1,7) Greens Creek (2,3) 10,018 10.5 0.09 2.5 6.6 105,222 881 — 250,580 — 658,730 Lucky Friday (2,4) 6,265 12.5 — 7.9 3.7 78,006 — — 492,400 — 229,380 Casa Berardi Underground (2,5) 230 — 0.14 — — — 33 — — — — Casa Berardi Open Pit (2,5) 15,624 — 0.08 — — — 1,238 — — Keno Hill (2,6) 2,069 26.6 0.01 2.8 2.5 55,068 13 58,170 52,380 Total Proven and Probable 34,206 238,296 2,165 801,150 940,490 (1) The term “reserve” means an estimate of tonnage and grade or quality of indicated and measured mineral resources that, in the opinion of the qualified person, can be the basis of an economically viable project.
As of December 31, 2022, we have recorded a $37.2 million asset retirement obligation for reclamation and closure costs. We maintained a $92.2 million reclamation and long-term water treatment bond for Greens Creek as of December 31, 2022.
We maintained a $92.2 million reclamation and long-term water treatment bond for Greens Creek as of December 31, 2023. The net book value of the Greens Creek property and its associated plant, equipment and mineral interests was approximately $522.6 million as of December 31, 2023. The vintage of the facilities at Greens Creek ranges from the 1980s to 2023.
Removed
The Hosco Project is the only project, other than the mining operations, that contains more than 10% of the aggregate measured and indicated resources.
Added
Mineral resources are reported for all resource projects regardless of the percentage of total measured and indicated resource. (13) The resource NSR cut-off values for Greens Creek are $230/ton for all zones except the Gallagher Zone at $235/ton; metallurgical recoveries (actual 2023): 80% for silver, 74% for gold, 82% for lead, and 89% for zinc.
Removed
Greens Creek is classified as a volcanogenic massive sulfide deposit; the orebodies contain silver, zinc, gold and lead, and lie within the Admiralty Island National Monument, an environmentally sensitive area. The Greens Creek property includes 440 unpatented lode mining claims, 58 unpatented millsite claims, 17 patented lode claims and one patented millsite.
Added
(16) The resource NSR cut-off value at Keno Hill is $129.10/ton (CAN$185/tonne); using minimum width of 4.9 feet (1.5m); metallurgical recovery (actual 2023): 96% for silver, 93% for lead, 81% for zinc; US$/CAN$ exchange rate: 1:1.3.
Removed
Planned 2023 activities to potentially add reserves and resources include approximately 128,000 feet of definition drilling in seven zones and approximately 26,700 feet of exploration drilling in five zones. In addition to drilling, approximately 550 feet of underground drifting is planned to provide future drilling platforms.
Added
(29) Resources at the Rackla-Tiger project are based on a gold price of $1,650/oz, metallurgical recovery of 95% for gold, and cut-off grades of 0.02 oz/ton gold for the open pit portion of the resources and 0.04 oz/ton gold for the underground portion of the resources.
Added
(30) Resources at the Rackla-Osiris project are based on a gold price of $1,850/oz, metallurgical recovery of 83% for gold, and cut-off grade of 0.03 oz/ton gold for the open pit portion of the resources and 0.06 oz/ton gold for the underground portion of the resources.
Added
See Note 4 of Notes to Consolidated Financial Statements and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations - Greens Creek for information on its financial performance. Greens Creek is within the Admiralty Island National Monument, an environmentally sensitive area.
Added
The Greens Creek deposit is a volcanogenic massive sulfide deposit with a relatively high precious metal content compared to other deposits of its type. The host rock consists predominantly of marine sedimentary and mafic to ultramafic volcanic and plutonic rocks, which have been subjected to multiple periods of deformation.
Added
These deformational episodes imposed intense tectonic fabrics and folds within the rock. The deposits occur at the contact between Mississippian-age mafic meta-volcanic footwall and a hanging wall of Triassic-age argillite and basalt. Extensive hydrothermal alteration occurred within the meta-volcanic footwall prior to and during ore deposition, converting the basalts to sericite-rich, phyllitic schist.
Added
At ore deposition, thick and extensive lenses of base and precious metals, with pyrite and barite, formed at the footwall-hanging wall contact. Major sulfide minerals include pyrite, sphalerite, galena, and tetrahedrite/tennantite. 41 Greens Creek consists of the mine, an ore concentrating mill, a tailings storage area, a ship-loading facility, camp facilities, a ferry dock, and other related infrastructure.
Added
Management's Discussion and Analysis of Financial Condition and Results of Operations, under Reconciliation of Total Costs of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP).
Added
(2) Proven and probable mineral reserves are calculated and reviewed in-house and are subject to periodic audit by others, although audits are not performed on an annual basis. Cutoff grade assumptions vary by ore body and are developed based on reserve metals price assumptions, anticipated mill recoveries and smelter payables, and cash operating costs.
Added
Due to multiple ore metals, and complex combinations of ore types, metal ratios and metallurgical performances at Greens Creek, the cutoff grade is expressed in terms of NSR, rather than metal grade. The cut-off grade at Greens Creek is $230 per ton NSR for all zones except Gallagher, which has a cutoff grade of $235 per ton NSR.
Added
The cut-off grade calculations include costs associated with mining, processing, surface operations, environmental, general administrative, sustaining capital, and royalty charges, if any.
Added
Our estimates of proven and probable reserves are based on the following metals prices: 43 December 31, 2023 2022 2021 Silver (per ounce) $ 17.00 $ 17.00 $ 17.00 Gold (per ounce) $ 1,600 $ 1,600 $ 1,600 Lead (per pound) $ 0.90 $ 0.90 $ 0.90 Zinc (per pound) $ 1.15 $ 1.15 $ 1.15 (3) Reserves are in-situ materials that incorporate estimates of the amount of waste that must be mined along with the ore and expected mining recovery.
Added
The 2023 reserve model assumes average total mill recoveries of 80% for silver, 74% for gold, 89% for zinc and 82% for lead. (4) The change in reserves in 2023 versus 2022 was due to mining depletion and an increase in cut-off grade due to increased costs.
Added
These changes were partially offset by reserve increases from drilling with resources converting to reserves.The change in reserves in 2022 versus 2021 was due to due to data from new drill holes, partially offset by continued depletion of the deposit through production and reclassification of some material to indicated resource given proximity to previously mined areas.
Added
(5) Probable reserves at Greens Creek are based on average drill spacing of 50 to 100 feet. Proven reserves typically require that mining samples for the basis of the ore grade estimates used, while probable reserve grade estimates can be based entirely on drilling results.
Added
The proven reserves reported for Greens Creek for 2023 represent stockpiled ore. 44 Information on in-situ mineral resources for Greens Creek excluding reserves for the past three years is set forth in the following table.
Added
Years Ended December 31, 2023 2022 2021 Measured Resources (1,2,3) Total tons — — — Silver (ounces per ton) — — — Gold (ounces per ton) — — — Zinc (percent) — — — Lead (percent) — — — Silver (ounces) — — — Gold (ounces) — — — Zinc (tons) — — — Lead (tons) — — — Indicated Resources (1,2,3) Total tons 8,039,900 8,421,200 8,355,000 Silver (ounces per ton) 13.9 12.9 12.8 Gold (ounces per ton) 0.10 0.10 0.10 Zinc (percent) 8.0 8.0 8.4 Lead (percent) 3.0 2.9 3.0 Silver (ounces) 111,526,000 108,717,200 106,670,300 Gold (ounces) 800,000 810,300 835,900 Zinc (tons) 643,950 675,740 701,520 Lead (tons) 239,250 245,990 250,040 Measured and Indicated Resources (1,2,3) Total tons 8,039,900 8,421,200 8,355,000 Silver (ounces per ton) 13.9 12.9 12.8 Gold (ounces per ton) 0.10 0.10 0.10 Zinc (percent) 8.0 8.0 8.4 Lead (percent) 3.0 2.9 3.0 Silver (ounces) 111,526,000 108,717,200 106,670,300 Gold (ounces) 800,000 810,300 835,900 Zinc (tons) 643,950 675,740 701,520 Lead (tons) 239,250 245,990 250,040 Inferred Resources (1,2,3) Total tons 1,929,600 2,383,200 2,151,700 Silver (ounces per ton) 13.4 12.2 12.8 Gold (ounces per ton) 0.08 0.08 0.08 Zinc (percent) 2.9 6.9 6.8 Lead (percent) 6.9 2.8 2.8 Silver (ounces) 25,891,000 28,949,200 27,507,500 Gold (ounces) 154,000 178,100 163,700 Zinc (tons) 133,260 164,080 146,020 Lead (tons) 55,890 67,400 60,140 (1) Mineral resources are based on $1,750/oz for gold, $21.00/oz for silver, $1.15/lb for lead, $1.35/lb for zinc and are reported in-situ and exclusive of mineral reserves.
Added
(3) Measured resources were not defined for year-end 2023; indicated resources for silver increased 5% from 2022 given additions from drilling and reclassification of some previously defined reserve material; inferred resources for silver decreased 6% from 2022 given conversion to indicated resources of reserves due to drilling. 45 Lucky Friday We have owned and operated the Lucky Friday mine since 1958, which we have wholly owned since 1964.
Added
Lucky Friday is a deep underground silver, lead and zinc mine located in the Coeur d’Alene Mining District in northern Idaho at 47°28'15.70”N Latitude, 115°47'0.44”W Longitude (WGS84). Lucky Friday is one-quarter mile east of Mullan, Idaho, and is adjacent to U.S. Interstate 90. We report Lucky Friday as a separate segment in our consolidated financial statements.
Added
The Lucky Friday mine is comprised of 710 acres consisting of 43 patented mining claims and fee lands and 535 acres consisting of 53 unpatented mining claims.
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We also own or control approximately 26 square miles of mineral interests, which include patented mining and millsite claims, fee lands, and unpatented mining claims, that are adjacent to the Lucky Friday mine property.
Added
Below is a map illustrating the location and access to Lucky Friday: The principal mineral-bearing structure at the Lucky Friday Mine through 1997 was the Lucky Friday Vein, a fissure vein typical of many in the Coeur d’Alene Mining District. The Revett Formation (quartzite) of late Precambrian age hosts the productive portion of the vein.
Added
The Lucky Friday Vein strikes northeast and dips nearly vertical with an average width of six to seven feet. Its principal ore minerals are galena and tetrahedrite with minor amounts of sphalerite and chalcopyrite. The ore occurs as a single, continuous ore zone in, and along the Lucky Friday Vein.
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In 1991, Hecla discovered several mineralized veins containing some high-grade silver ores in the Gold Hunter property, located about 5,000 feet northwest of the Lucky Friday Vein workings. Hecla finished a feasibility study in 1997 and achieved full production in 1998.
Added
The Gold Hunter veins are hosted in a 200-foot-thick siliceous lens within the Wallace Formation (quartzite, limestone, and argillite) that transitions to the St Regis Formation (quartzite and argillite) below the 5900-level. The veins are sub-parallel, and perhaps ‘en-echelon’ along strike and dip. The strike of the vein system is west-northwest with a dip of 85 degrees to the south.
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While the veins share many characteristics with the Lucky Friday Vein, there are some mineralogical and rock mechanics differences that currently make mining at Gold Hunter more attractive. Access to the mining horizons from the surface is by shaft access. Once underground, trackless drifts and ramps are utilized to reach the mining areas.
Added
An internal, hoisting shaft was completed in 2017 to extend access at depth in the Gold Hunter area. The principal mining methods in use at Lucky Friday consist of underhand systems with integral paste fill and varying degrees of mechanization. In 2021, we tested and implemented the underhand closed bench ("UCB") mining method.
Added
The UCB method is a new and patented productive mining method developed by Hecla for proactive control of fault-slip seismicity in deep, high-stress, narrow-vein mining. The method uses bench drilling and blasting methods to fragment significant vertical and lateral extents of the vein beneath a top cut taken along the strike of the vein and under engineered backfill.
Added
The method is accomplished without the use of drop raises or lower mucking drives which may result in local stress concentrations and increased exposure to seismic events. Large blasts using up to 35,000 lbs. of pumped emulsion and programmable electronic detonators fragment up to 350 feet of strike length to a depth of approximately 46 30 feet.
Added
These large blasts proactively induce fault-slip seismicity at the time of the blast and shortly after it. This blasted corridor is then mined underhand for two cuts. As these cuts are mined, little to no blasting is done to advance them. Dilution is controlled by supporting the hanging wall and footwall as the mining progresses through the blasted ore.
Added
The entire cycle repeats and stoping advances downdip, under fill, and in a destressed zone. The method allows for greater control of fault-slip seismic events significantly improving safety. In conjunction, a notable productivity increase has been achieved by reducing seismic delays and utilizing bulk mining activities.
Added
In 2023, 2022 and 2021, 87%, 88% and 86%, respectively of the tons mined were produced through the UCB method. The underhand cut and fill method was also utilized in 2023, 2022 and 2021.
Added
Under this method, once a cut is taken along the strike of the vein, it is backfilled with cemented tailings and the next cut is accessed below from the ramp system. Both methods utilize rubber-tired equipment to access the veins through ramps developed outside of the ore body.
Added
Ore at Lucky Friday is processed using a conventional lead/zinc flotation flowsheet, and the plant capacity currently is estimated at 1,165 tons per day. During August 2023, the mine was suspended while repairing an unused station in the #2 ventilation shaft, which is also the secondary egress. The operation remained suspended due to a fire at the unused station.
Added
By early September, the fire had been extinguished, normal ventilation was reestablished and the workforce recalled. Following evaluation of alternatives, it was determined that in order to safely bring the mine back into production in the most rapid and cost effective way, a new secondary egress would be developed to bypass the damaged portion of the #2 shaft.
Added
The new egress includes extension of an existing ramp 1,600 feet, installation of a 290-foot-long manway raise, and development of an 850 foot ventilation raise. Prior to the suspension, ore was processed at an average rate of approximately 1,056 tons per day, and total mill recovery was approximately 96% for silver, 95% for lead and 85% for zinc during 2023.
Added
For more information, see Exhibit 96.2, the Technical Report Summary on the Lucky Friday Mine, Idaho, U.S.A., prepared for the Company by the QP, SLR, with an effective date of December 31, 2021. At December 31, 2023, there were 386 employees at Lucky Friday.
Added
The United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial, and Service Workers International Union is the bargaining agent for Lucky Friday’s 275 hourly employees as of December 31, 2023. During early January 2023, the bargaining agent ratified a six year labor agreement that expires in May 2029.
Added
Following a strike that started in March 2017 and ended in early January 2020, re-staffing of the mine and ramp-up activities were completed during 2020, with a return to full production starting in the fourth quarter of 2020. As of December 31, 2023, we have recorded a $12.0 million asset retirement obligation for reclamation and closure costs.
Added
The current mine plan at Lucky Friday utilizes estimates of reserves and resources for approximately 19 years of production, through 2042. 47 Information with respect to the Lucky Friday’s production, total cost of sales, average Cash Cost, After By-product Credits, Per Silver Ounce, AISC, After By-product Credits, Per Silver Ounce, and proven and probable in -situ mineral reserves for the past three years is set forth in the table below.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

9 edited+0 added−0 removed2 unchanged
Biggest changeThe issuances were as follows: Date Purchaser Number of Shares Value of Shares at Issuance ($) October 14, 2022 Hecla Mining Company Pre-2005 Supplemental Excess Retirement Plan and the Hecla Mining Company Post-2004 Supplemental Excess Retirement Plan ("SERP") 1,000,000 $4.2 million May 19, 2022 Hecla Mining Company Retirement Plan Trust (“Hecla Plan”) 900,000 $4.2 million Lucky Friday Pension Plan Trust (“Lucky Friday Plan”) 290,000 $1.3 million September 22, 2021 Hecla Mining Company Retirement Plan Trust (“Hecla Plan”) 900,000 $4.9 million Lucky Friday Pension Plan Trust (“Lucky Friday Plan”) 100,000 $0.5 million January 27, 2021 SERP 3,500,000 $16.8 million November 20, 2020 Hecla Plan 554,455 $2.8 million Lucky Friday Plan 89,109 $0.5 million August 18, 2020 Hecla Plan 1,653,160 $10.0 million Lucky Friday Plan 405,186 $2.4 million April 9, 2020 Hecla Plan 119,048 $0.3 million Lucky Friday Plan 47,619 $0.1 million 52 The following performance graph compares the performance of our common stock during the period beginning December 31, 2017 and ending December 31, 2022 to the S&P 500 and the S&P 500 Gold Index.
Biggest changeThe issuances were as follows: Date Purchaser Number of Shares Value of Shares at Issuance ($) October 16, 2023 Hecla Mining Company Pre-2005 Supplemental Excess Retirement Plan and the Hecla Mining Company Post-2004 Supplemental Excess Retirement Plan ("SERP") 200,000 $0.8 million Hecla Mining Company Retirement Plan Trust (“Hecla Plan”) 45,000 $0.2 million Lucky Friday Pension Plan Trust (“Lucky Friday Plan”) 4,500 $0.0 million October 14, 2022 SERP 1,000,000 $4.2 million May 19, 2022 Hecla Plan 900,000 $4.2 million Lucky Friday Plan 290,000 $1.3 million September 22, 2021 Hecla Plan 900,000 $4.9 million Lucky Friday Plan 100,000 $0.5 million January 27, 2021 SERP 3,500,000 $16.8 million 59 The following performance graph compares the performance of our common stock during the period beginning December 31, 2018 and ending December 31, 2023 to the S&P 500 and the Philadelphia Gold and Silver Index.
Item 4. Mine Safety Disclosures The information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in exhibit 95 to this report. 51 PART II Item 5 .
Item 4. Mine Safety Disclosures The information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in exhibit 95 to this report. 58 PART II Item 5 .
On May 8, 2012, we announced that our board of directors approved a stock repurchase program. Under the program, we are authorized to repurchase up to 20 million shares of our outstanding common stock from time to time in open market or privately 53 negotiated transactions. See Note 11 of Notes to Consolidated Financial Statements for more information.
On May 8, 2012, we announced that our board of directors approved a stock repurchase program. Under the program, we are authorized to repurchase up to 20 million shares of our outstanding common stock from time to time in open market or privately negotiated transactions. See Note 12 of Notes to Consolidated Financial Statements for more information.
For the years 2022, 2021 and 2020, we issued shares of our common stock on multiple occasions to three of our employee benefit plans in order to fund our obligations under those plans.
For the years 2023, 2022 and 2021, we issued shares of our common stock on multiple occasions to three of our employee benefit plans in order to fund our obligations under those plans.
Each issuance was made pursuant to an exemption from registration under the Securities Act pursuant to Section 4(a)(2) of that Act and, except for the October 14, 2022 contribution, was followed by the filing of a shelf registration statement on SEC Form S-3 allowing for the public resales of those shares.
Each issuance was made pursuant to an exemption from registration under the Securities Act pursuant to Section 4(a)(2) of that Act and, except for the October 16, 2023 and October 14, 2022 contributions, was followed by the filing of a shelf registration statement on SEC Form S-3 allowing for the public resales of those shares.
We made no purchases of our outstanding common stock during the year ended December 31, 2022.
We made no purchases of our outstanding common stock during the year ended December 31, 2023.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Shares of our common stock are traded on the New York Stock Exchange, Inc. under the symbol “HL.” As of February 10, 2023, there were 2,945 stockholders of record of our common stock.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Shares of our common stock are traded on the New York Stock Exchange, Inc. under the symbol “HL.” As of February 9, 2024, there were 2,859 stockholders of record of our common stock.
The following table provides information as of December 31, 2022 regarding our compensation plans under which equity securities are authorized for issuance: Number of Securities To Be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted-Average Exercise Price of Outstanding Options Number of Securities Remaining Available For Future Issuance Under Equity Compensation Plans Equity Compensation Plans Approved by Security Holders: 2010 Stock Incentive Plan — N/A 13,808,002 Stock Plan for Non-Employee Directors — N/A 2,170,959 Key Employee Deferred Compensation Plan — N/A 1,665,037 Total — N/A 17,643,998 See Note 11 of Notes to Consolidated Financial Statements for information regarding the above plans.
The following table provides information as of December 31, 2023 regarding our compensation plans under which equity securities are authorized for issuance: Number of Securities To Be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted-Average Exercise Price of Outstanding Options Number of Securities Remaining Available For Future Issuance Under Equity Compensation Plans Equity Compensation Plans Approved by Security Holders: 2010 Stock Incentive Plan — N/A 12,756,250 Stock Plan for Non-Employee Directors — N/A 2,165,894 Key Employee Deferred Compensation Plan — N/A 1,665,037 Total — N/A 16,587,181 See Note 12 of Notes to Consolidated Financial Statements for information regarding the above plans.
Comparison of 5 Year Cumulative Total Return Among Hecla Mining Company, the S&P 500 Index, and the S&P Gold Index Date Hecla Mining S&P 500 S&P 500 Gold Index December 2017 $ 100.00 $ 100.00 $ 100.00 December 2018 $ 59.63 $ 92.30 $ 84.61 December 2019 $ 85.85 $ 120.90 $ 98.72 December 2020 $ 164.52 $ 140.28 $ 92.61 December 2021 $ 133.48 $ 178.04 $ 126.84 December 2022 $ 142.74 $ 143.58 $ 137.90 The stock performance information above is “furnished” and shall not be deemed to be “soliciting material” or subject to Rule 14A of the Exchange Act, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, and shall not be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, whether made before or after the date of this report and irrespective of any general incorporation by reference language in any such filing, except to the extent that it specifically incorporates the information by reference.
Comparison of 5 Year Cumulative Total Return Among Hecla Mining Company, the S&P 500, and the Philadelphia Gold and Silver Index Date Hecla Mining S&P 500 S&P 500 Gold Index December 2018 $ 100.00 $ 100.00 $ 100.00 December 2019 143.96 130.99 116.68 December 2020 275.87 151.99 109.46 December 2021 223.83 192.90 149.92 December 2022 239.37 155.57 162.99 December 2023 $ 208.16 $ 191.57 $ 143.09 The stock performance information above is “furnished” and shall not be deemed to be “soliciting material” or subject to Rule 14A of the Exchange Act, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, and shall not be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, whether made before or after the date of this report and irrespective of any general incorporation by reference language in any such filing, except to the extent that it specifically incorporates the information by reference.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

64 edited+14 added−22 removed35 unchanged
Biggest changeIn thousands (except per ounce amounts) Year Ended December 31, 2022 Greens Creek Lucky Friday (2) Corporate and Other (3) Total Silver Total cost of sales $ 232,718 $ 116,598 $ — $ 349,316 Depreciation, depletion and amortization (48,911 ) (33,704 ) — (82,615 ) Treatment costs 37,836 18,605 — 56,441 Change in product inventory 5,885 2,049 — 7,934 Reclamation and other costs (1,489 ) (1,034 ) — (2,523 ) Cash Cost, Before By-product Credits (1) 226,039 102,514 — 328,553 Reclamation and other costs 2,821 1,128 — 3,949 Exploration 5,920 — 2,567 8,487 Sustaining capital 40,705 33,306 334 74,345 General and administrative — — 43,384 43,384 AISC, Before By-product Credits (1) 275,485 136,948 46,285 458,718 By-product credits: Zinc (113,835 ) (27,607 ) (141,442 ) Gold (75,596 ) — (75,596 ) Lead (29,800 ) (52,568 ) (82,368 ) Total By-product credits (219,231 ) (80,175 ) (299,406 ) Cash Cost, After By-product Credits $ 6,808 $ 22,339 $ — $ 29,147 AISC, After By-product Credits $ 56,254 $ 56,773 $ 46,285 $ 159,312 Divided by silver ounces produced 9,742 4,413 14,155 Cash Cost, Before By-product Credits, per Silver Ounce $ 23.20 $ 23.23 $ 23.21 By-product credits per ounce (22.50 ) (18.17 ) (21.15 ) Cash Cost, After By-product Credits, per Silver Ounce $ 0.70 $ 5.06 $ 2.06 AISC, Before By-product Credits, per Silver Ounce $ 28.27 $ 31.03 $ 32.40 By-product credits per ounce (22.50 ) (18.17 ) (21.15 ) AISC, After By-product Credits, per Silver Ounce $ 5.77 $ 12.86 $ 11.25 69 In thousands (except per ounce amounts) Year Ended December 31, 2022 Casa Berardi Nevada Operations and Other (4) Total Gold Total cost of sales $ 248,898 $ 4,535 $ 253,433 Depreciation, depletion and amortization (60,962 ) (361 ) $ (61,323 ) Treatment costs 1,866 — $ 1,866 Change in product inventory 186 — $ 186 Reclamation and other costs (819 ) — $ (819 ) Exclusion of Nevada Operations and Other costs — (4,174 ) (4,174 ) Cash Cost, Before By-product Credits (1) 189,169 — 189,169 Reclamation and other costs 819 — 819 Exploration 6,627 — 6,627 Sustaining capital 36,883 — 36,883 AISC, Before By-product Credits (1) 233,498 — 233,498 By-product credits: Silver (610 ) — (610 ) Total By-product credits (610 ) — (610 ) Cash Cost, After By-product Credits $ 188,559 $ — $ 188,559 AISC, After By-product Credits $ 232,888 $ — $ 232,888 Divided by gold ounces produced 128 — 128 Cash Cost, Before By-product Credits, per Gold Ounce $ 1,483 $ — $ 1,483 By-product credits per ounce (5 ) — (5 ) Cash Cost, After By-product Credits, per Gold Ounce $ 1,478 $ — $ 1,478 AISC, Before By-product Credits, per Gold Ounce $ 1,830 $ — $ 1,830 By-product credits per ounce (5 ) — (5 ) AISC, After By-product Credits, per Gold Ounce $ 1,825 $ — $ 1,825 In thousands (except per ounce amounts) Year Ended December 31, 2022 Total Silver Total Gold Total Total cost of sales $ 349,316 $ 253,433 $ 602,749 Depreciation, depletion and amortization (82,615 ) (61,323 ) (143,938 ) Treatment costs 56,441 1,866 58,307 Change in product inventory 7,934 186 8,120 Exclusion of Nevada Operations and Other — (4,174 ) (4,174 ) Reclamation and other costs (2,523 ) (819 ) (3,342 ) Cash Cost, Before By-product Credits (1) 328,553 189,169 517,722 Reclamation and other costs 3,949 819 4,768 Exploration 8,487 6,627 15,114 Sustaining capital 74,345 36,883 111,228 General and administrative 43,384 — 43,384 AISC, Before By-product Credits (1) 458,718 233,498 692,216 By-product credits: Zinc (141,442 ) — (141,442 ) Gold (75,596 ) — (75,596 ) Lead (82,368 ) — (82,368 ) Silver (610 ) (610 ) Total By-product credits (299,406 ) (610 ) (300,016 ) Cash Cost, After By-product Credits $ 29,147 $ 188,559 $ 217,706 AISC, After By-product Credits $ 159,312 $ 232,888 $ 392,200 Divided by ounces produced 14,155 128 Cash Cost, Before By-product Credits, per Ounce $ 23.21 $ 1,483 By-product credits per ounce (21.15 ) (5 ) Cash Cost, After By-product Credits, per Ounce $ 2.06 $ 1,478 AISC, Before By-product Credits, per Ounce $ 32.40 $ 1,830 By-product credits per ounce (21.15 ) (5 ) AISC, After By-product Credits, per Ounce $ 11.25 $ 1,825 70 In thousands (except per ounce amounts) Year Ended December 31, 2021 Greens Creek Lucky Friday (2) Corporate and other (3) Total Silver Total cost of sales $ 213,113 $ 97,538 $ 247 $ 310,898 Depreciation, depletion and amortization (48,710 ) (26,846 ) (152 ) (75,708 ) Treatment costs 36,099 16,723 — 52,822 Change in product inventory 80 (406 ) — (326 ) Reclamation and other costs (5) (3,466 ) (1,039 ) (95 ) (4,600 ) Cash Cost, Before By-product Credits (1) 197,116 85,970 — 283,086 Reclamation and other costs 3,390 1,056 4,446 Exploration 4,591 — 2,226 6,817 Sustaining capital 27,582 26,517 210 54,309 General and administrative (5) — — 34,570 34,570 AISC, Before By-product Credits (1) 232,679 113,543 37,006 383,228 By-product credits: Zinc (100,214 ) (19,479 ) — (119,693 ) Gold (72,011 ) — — (72,011 ) Lead (30,922 ) (42,966 ) — (73,888 ) Total By-product credits (203,147 ) (62,445 ) — (265,592 ) Cash Cost, After By-product Credits $ (6,031 ) $ 23,525 $ — $ 17,494 AISC, After By-product Credits $ 29,532 $ 51,098 $ 37,006 $ 117,636 Divided by silver ounces produced 9,243 3,564 12,807 Cash Cost, Before By-product Credits, per Silver Ounce $ 21.33 $ 24.12 $ 22.11 By-product credits per ounce (21.98 ) (17.52 ) (20.74 ) Cash Cost, After By-product Credits, per Silver Ounce $ (0.65 ) $ 6.60 $ 1.37 AISC, Before By-product Credits, per Silver Ounce $ 25.17 $ 31.86 $ 29.93 By-product credits per ounce (21.98 ) (17.52 ) (20.74 ) AISC, After By-product Credits, per Silver Ounce $ 3.19 $ 14.34 $ 9.19 In thousands (except per ounce amounts) Year Ended December 31, 2021 Casa Berardi (6) Nevada Operations (4) Total Gold Total cost of sales $ 229,829 $ 48,945 $ 278,774 Depreciation, depletion and amortization (80,744 ) (15,341 ) (96,085 ) Treatment costs 1,513 1,731 3,244 Change in product inventory 2,439 (10,907 ) (8,468 ) Reclamation and other costs (5) (841 ) 300 (541 ) Cash Cost, Before By-product Credits (1) 152,196 24,728 176,924 Reclamation and other costs 841 1,008 1,849 Exploration 5,326 — 5,326 Sustaining capital 30,643 511 31,154 AISC, Before By-product Credits (1) 189,006 26,247 215,253 By-product credits: Silver (839 ) (1,152 ) (1,991 ) Total By-product credits (839 ) (1,152 ) (1,991 ) Cash Cost, After By-product Credits $ 151,357 $ 23,576 $ 174,933 AISC, After By-product Credits $ 188,167 $ 25,095 $ 213,262 Divided by gold ounces produced 135 21 156 Cash Cost, Before By-product Credits, per Gold Ounce $ 1,131 $ 1,193 $ 1,140 By-product credits per ounce (6 ) (56 ) (13 ) Cash Cost, After By-product Credits, per Gold Ounce $ 1,125 $ 1,137 $ 1,127 AISC, Before By-product Credits, per Gold Ounce $ 1,405 $ 1,267 $ 1,387 By-product credits per ounce (6 ) (56 ) (13 ) AISC, After By-product Credits, per Gold Ounce $ 1,399 $ 1,211 $ 1,374 71 In thousands (except per ounce amounts) Year Ended December 31, 2021 Total Silver Total Gold Total Total cost of sales $ 310,898 $ 278,774 $ 589,672 Depreciation, depletion and amortization (75,708 ) (96,085 ) (171,793 ) Treatment costs 52,822 3,244 56,066 Change in product inventory (326 ) (8,468 ) (8,794 ) Reclamation and other costs (4,600 ) (541 ) (5,141 ) Cash Cost, Before By-product Credits (1) 283,086 176,924 460,010 Reclamation and other costs 4,446 1,849 6,295 Exploration 6,817 5,326 12,143 Sustaining capital 54,309 31,154 85,463 General and administrative 34,570 — 34,570 AISC, Before By-product Credits (1) 383,228 215,253 598,481 By-product credits: Zinc (119,693 ) — (119,693 ) Gold (72,011 ) — (72,011 ) Lead (73,888 ) — (73,888 ) Silver — (1,991 ) (1,991 ) Total By-product credits (265,592 ) (1,991 ) (267,583 ) Cash Cost, After By-product Credits $ 17,494 $ 174,933 $ 192,427 AISC, After By-product Credits $ 117,636 $ 213,262 $ 330,898 Divided by ounces produced 12,807 156 Cash Cost, Before By-product Credits, per Ounce $ 22.11 $ 1,140 By-product credits per ounce (20.74 ) (13 ) Cash Cost, After By-product Credits, per Ounce $ 1.37 $ 1,127 AISC, Before By-product Credits, per Ounce $ 29.93 $ 1,387 By-product credits per ounce (20.74 ) (13 ) AISC, After By-product Credits, per Ounce $ 9.19 $ 1,374 In thousands (except per ounce amounts) Year Ended December 31, 2020 Greens Creek Lucky Friday (2) Corporate and other (3) Total Silver Total cost of sales $ 210,748 $ 56,706 $ 24,104 $ 291,558 Depreciation, depletion and amortization (49,692 ) (11,473 ) (3,548 ) (64,713 ) Treatment costs 77,122 4,590 287 81,999 Change in product inventory (3,144 ) 2,340 (2,357 ) (3,161 ) Reclamation and other costs (1,608 ) (274 ) (1,198 ) (3,080 ) Lucky Friday cash costs excluded — (31,442 ) — (31,442 ) Cash Cost, Before By-product Credits (1) 233,426 20,447 17,288 271,161 Reclamation and other costs 3,154 222 418 3,794 Exploration 354 — 1,788 2,142 Sustaining capital 28,797 7,154 337 36,288 General and administrative (5) — — 33,759 33,759 AISC, Before By-product Credits (1) 265,731 27,823 53,590 347,144 By-product credits: Zinc (79,413 ) (4,273 ) — (83,686 ) Gold (74,615 ) — (12,586 ) (87,201 ) Lead (28,193 ) (8,421 ) — (36,614 ) Silver — — — Total By-product credits (182,221 ) (12,694 ) (12,586 ) (207,501 ) Cash Cost, After By-product Credits $ 51,205 $ 7,753 $ 4,702 $ 63,660 AISC, After By-product Credits $ 83,510 $ 15,129 $ 41,004 $ 139,643 Divided by silver ounces produced 10,495 830 955 12,280 Cash Cost, Before By-product Credits, per Silver Ounce $ 22.24 $ 24.63 $ 22.08 By-product credits per ounce (17.36 ) $ (15.29 ) (16.90 ) Cash Cost, After By-product Credits, per Silver Ounce $ 4.88 $ 9.34 $ 5.18 AISC, Before By-product Credits, per Silver Ounce $ 25.33 $ 33.51 $ 28.27 By-product credits per ounce (17.36 ) $ (15.29 ) (16.90 ) AISC, After By-product Credits, per Silver Ounce $ 7.97 $ 18.22 $ 11.37 72 In thousands (except per ounce amounts) Year Ended December 31, 2020 Casa Berardi Nevada Operations (4) Total Total cost of sales $ 194,414 $ 44,801 $ 239,215 Depreciation, depletion and amortization (60,552 ) (22,845 ) (83,397 ) Treatment costs 2,591 45 2,636 Change in product inventory 2,226 15,869 18,095 Reclamation and other costs (773 ) (978 ) (1,751 ) Exclusion of Nevada Operations Costs — (13,511 ) (13,511 ) Cash Cost, Before By-product Credits (1) 137,906 23,381 161,287 Reclamation and other costs 386 654 1,040 Exploration 2,231 — 2,231 Sustaining capital 34,431 1,600 36,031 AISC, Before By-product Credits (1) 174,954 25,635 200,589 By-product credits: Silver (499 ) (635 ) (1,134 ) Total By-product credits (499 ) (635 ) (1,134 ) Cash Cost, After By-product Credits $ 137,407 $ 22,746 $ 160,153 AISC, After By-product Credits $ 174,455 $ 25,000 $ 199,455 Divided by gold ounces produced 121 32 153 Cash Cost, Before By-product Credits, per Gold Ounce $ 1,135 $ 736 $ 1,052 By-product credits per ounce (4 ) (20 ) (7 ) Cash Cost, After By-product Credits, per Gold Ounce $ 1,131 $ 716 $ 1,045 AISC, Before By-product Credits, per Gold Ounce $ 1,440 $ 807 $ 1,309 By-product credits per ounce (4 ) (20 ) (7 ) AISC, After By-product Credits, per Gold Ounce $ 1,436 $ 787 $ 1,302 In thousands (except per ounce amounts) Year Ended December 31, 2020 Total Silver Total Gold Total Total cost of sales $ 291,558 $ 239,215 $ 530,773 Depreciation, depletion and amortization (64,713 ) (83,397 ) (148,110 ) Treatment costs 81,999 2,636 84,635 Change in product inventory (3,161 ) 18,095 14,934 Reclamation and other costs (3,080 ) (1,751 ) (4,831 ) Lucky Friday cash costs excluded (31,442 ) (13,511 ) (44,953 ) Cash Cost, Before By-product Credits (1) 271,161 161,287 432,448 Reclamation and other costs 3,794 1,040 4,834 Exploration 2,142 2,231 4,373 Sustaining capital 36,288 36,031 72,319 General and administrative 33,759 — 33,759 AISC, Before By-product Credits (1) 347,144 200,589 547,733 By-product credits: Zinc (83,686 ) — (83,686 ) Gold (87,201 ) — (87,201 ) Lead (36,614 ) — (36,614 ) Silver — (1,134 ) (1,134 ) Total By-product credits (207,501 ) (1,134 ) (208,635 ) Cash Cost, After By-product Credits $ 63,660 $ 160,153 $ 223,813 AISC, After By-product Credits $ 139,643 $ 199,455 $ 339,098 Divided by ounces produced 12,280 153 Cash Cost, Before By-product Credits, per Ounce $ 22.08 $ 1,052 By-product credits per ounce (16.90 ) (7 ) Cash Cost, After By-product Credits, per Ounce $ 5.18 $ 1,045 AISC, Before By-product Credits, per Ounce $ 28.27 $ 1,309 By-product credits per ounce (16.90 ) (7 ) AISC, After By-product Credits, per Ounce $ 11.37 $ 1,302 (1) Includes all direct and indirect operating costs related to the physical activities of producing metals, including mining, processing and other plant costs, third-party refining and marketing expense, non-discretionary on-site general and administrative costs, royalties and mining production 73 taxes, before by-product revenues earned from all metals other than the primary metal produced at each operation.
Biggest changeIn thousands (except per ounce amounts) Year Ended December 31, 2023 Greens Creek Lucky Friday (2) Keno Hill Corporate and Other (3) Total Silver Total cost of sales $ 259,895 $ 84,185 $ 35,518 $ — $ 379,598 Depreciation, depletion and amortization (53,995 ) (24,325 ) (4,277 ) — (82,597 ) Treatment costs 40,987 10,981 1,070 — 53,038 Change in product inventory (4,266 ) (5,164 ) — — (9,430 ) Reclamation and other costs (748 ) (826 ) — — (1,574 ) Exclusion of Lucky Friday cash costs (8) — (851 ) — — (851 ) Exclusion of Keno Hill cash costs (6) — — (32,311 ) — (32,311 ) Cash Cost, Before By-product Credits (1) 241,873 64,000 — — 305,873 Reclamation and other costs 2,889 671 — — 3,560 Sustaining capital 41,935 39,019 — 928 81,882 Exclusion of Lucky Friday sustaining costs (8) — (19,702 ) — — (19,702 ) General and administrative — — — 42,722 42,722 AISC, Before By-product Credits (1) 286,697 83,988 — 43,650 414,335 By-product credits: Zinc (83,454 ) (14,507 ) — — (97,961 ) Gold (104,507 ) — — — (104,507 ) Lead (29,284 ) (34,620 ) — — (63,904 ) Exclusion of Lucky Friday by-product credits (8) — 1,566 — — 1,566 Total By-product credits (217,245 ) (47,561 ) — — (264,806 ) Cash Cost, After By-product Credits $ 24,628 $ 16,439 $ — $ — $ 41,067 AISC, After By-product Credits $ 69,452 $ 36,427 $ — $ 43,650 $ 149,529 Ounces produced 9,732 3,086 12,818 Exclusion of Lucky Friday ounces produced (8) — (103 ) (103 ) Divided by silver ounces produced 9,732 2,983 12,715 Cash Cost, Before By-product Credits, per Silver Ounce $ 24.85 $ 21.45 $ 24.06 By-product credits per ounce (22.32 ) (15.94 ) (20.83 ) Cash Cost, After By-product Credits, per Silver Ounce $ 2.53 $ 5.51 $ 3.23 AISC, Before By-product Credits, per Silver Ounce $ 29.46 $ 28.15 $ 32.59 By-product credits per ounce (22.32 ) (15.94 ) (20.83 ) AISC, After By-product Credits, per Silver Ounce $ 7.14 $ 12.21 $ 11.76 76 In thousands (except per ounce amounts) Year Ended December 31, 2023 Casa Berardi Nevada Operations and Other (4) Total Gold Total cost of sales $ 221,341 $ 6,339 $ 227,680 Depreciation, depletion and amortization (66,037 ) (140 ) (66,177 ) Treatment costs 1,109 — 1,109 Change in product inventory (2,913 ) — (2,913 ) Reclamation and other costs (871 ) — (871 ) Exclusion of Casa Berardi cash costs (3) (2,851 ) — (2,851 ) Exclusion of Nevada Operations and Other costs — (6,199 ) (6,199 ) Cash Cost, Before By-product Credits (1) 149,778 — 149,778 Reclamation and other costs 871 — 871 Sustaining capital 34,971 — 34,971 AISC, Before By-product Credits (1) 185,620 — 185,620 By-product credits: Silver (522 ) — (522 ) Total By-product credits (522 ) — (522 ) Cash Cost, After By-product Credits $ 149,256 $ — $ 149,256 AISC, After By-product Credits $ 185,098 $ — $ 185,098 Divided by gold ounces produced 90 — 90 Cash Cost, Before By-product Credits, per Gold Ounce $ 1,658 $ — $ 1,658 By-product credits per ounce (6 ) — (6 ) Cash Cost, After By-product Credits, per Gold Ounce $ 1,652 $ — $ 1,652 AISC, Before By-product Credits, per Gold Ounce $ 2,054 $ — $ 2,054 By-product credits per ounce (6 ) — (6 ) AISC, After By-product Credits, per Gold Ounce $ 2,048 $ — $ 2,048 77 In thousands (except per ounce amounts) Year Ended December 31, 2023 Total Silver Total Gold Total Total cost of sales $ 379,598 $ 227,680 $ 607,278 Depreciation, depletion and amortization (82,597 ) (66,177 ) (148,774 ) Treatment costs 53,038 1,109 54,147 Change in product inventory (9,430 ) (2,913 ) (12,343 ) Reclamation and other costs (1,574 ) (871 ) (2,445 ) Exclusion of Lucky Friday cash costs (8) (851 ) — (851 ) Exclusion of Keno Hill cash costs (6) (32,311 ) — (32,311 ) Exclusion of Casa Berardi cash costs (3) — (2,851 ) (2,851 ) Exclusion of Nevada Operations and Other costs — (6,199 ) (6,199 ) Cash Cost, Before By-product Credits (1) 305,873 149,778 455,651 Reclamation and other costs 3,560 871 4,431 Sustaining capital 81,882 34,971 116,853 Exclusion of Lucky Friday sustaining costs (8) (19,702 ) — (19,702 ) General and administrative 42,722 — 42,722 AISC, Before By-product Credits (1) 414,335 185,620 599,955 By-product credits: Zinc (97,961 ) — (97,961 ) Gold (104,507 ) — (104,507 ) Lead (63,904 ) — (63,904 ) Silver — (522 ) (522 ) Exclusion of Lucky Friday by-product credits (8) 1,566 — 1,566 Total By-product credits (264,806 ) (522 ) (265,328 ) Cash Cost, After By-product Credits $ 41,067 $ 149,256 $ 190,323 AISC, After By-product Credits $ 149,529 $ 185,098 $ 334,627 Ounces produced $ 12,818 $ 90 Exclusion of Lucky Friday ounces produced (8) (103 ) — Divided by ounces produced 12,715 90 Cash Cost, Before By-product Credits, per Ounce $ 24.06 $ 1,658 By-product credits per ounce (20.83 ) (6 ) Cash Cost, After By-product Credits, per Ounce $ 3.23 $ 1,652 AISC, Before By-product Credits, per Ounce $ 32.59 $ 2,054 By-product credits per ounce (20.83 ) (6 ) AISC, After By-product Credits, per Ounce $ 11.76 $ 2,048 78 In thousands (except per ounce amounts) Year Ended December 31, 2022 Greens Creek Lucky Friday (2) Corporate and other (3) Total Silver Total cost of sales $ 232,718 $ 116,598 $ — $ 349,316 Depreciation, depletion and amortization (48,911 ) (33,704 ) — (82,615 ) Treatment costs 37,836 18,605 — 56,441 Change in product inventory 5,885 2,049 — 7,934 Reclamation and other costs (5) (1,489 ) (1,034 ) — (2,523 ) Cash Cost, Before By-product Credits (1) 226,039 102,514 — 328,553 Reclamation and other costs 2,821 1,128 — 3,949 Sustaining capital 40,705 33,306 334 74,345 General and administrative (5) — — 43,384 43,384 AISC, Before By-product Credits (1) 269,565 136,948 43,718 450,231 By-product credits: Zinc (113,835 ) (27,607 ) (141,442 ) Gold (75,596 ) — (75,596 ) Lead (29,800 ) (52,568 ) (82,368 ) Total By-product credits (219,231 ) (80,175 ) — (299,406 ) Cash Cost, After By-product Credits $ 6,808 $ 22,339 $ — $ 29,147 AISC, After By-product Credits $ 50,334 $ 56,773 $ 43,718 $ 150,825 Divided by silver ounces produced 9,742 4,413 14,155 Cash Cost, Before By-product Credits, per Silver Ounce $ 23.20 $ 23.23 $ 23.21 By-product credits per ounce (22.50 ) (18.17 ) (21.15 ) Cash Cost, After By-product Credits, per Silver Ounce $ 0.70 $ 5.06 $ 2.06 AISC, Before By-product Credits, per Silver Ounce $ 27.67 $ 31.03 $ 31.81 By-product credits per ounce (22.50 ) (18.17 ) (21.15 ) AISC, After By-product Credits, per Silver Ounce $ 5.17 $ 12.86 $ 10.66 In thousands (except per ounce amounts) Year Ended December 31, 2022 Casa Berardi (6) Nevada Operations (4) Total Gold Total cost of sales $ 248,898 $ 4,535 $ 253,433 Depreciation, depletion and amortization (60,962 ) (361 ) (61,323 ) Treatment costs 1,866 — 1,866 Change in product inventory 186 — 186 Reclamation and other costs (5) (819 ) — (819 ) Exclusion of Nevada Operations and Other costs (4,174 ) (4,174 ) Cash Cost, Before By-product Credits (1) 189,169 — 189,169 Reclamation and other costs 819 — 819 Sustaining capital 36,883 — 36,883 AISC, Before By-product Credits (1) 226,871 — 226,871 By-product credits: Silver (610 ) — (610 ) Total By-product credits (610 ) — (610 ) Cash Cost, After By-product Credits $ 188,559 $ — $ 188,559 AISC, After By-product Credits $ 226,261 $ — $ 226,261 Divided by gold ounces produced 128 — 128 Cash Cost, Before By-product Credits, per Gold Ounce $ 1,483 — $ 1,483 By-product credits per ounce (5 ) — (5 ) Cash Cost, After By-product Credits, per Gold Ounce $ 1,478 $ — $ 1,478 AISC, Before By-product Credits, per Gold Ounce $ 1,778 — $ 1,778 By-product credits per ounce (5 ) — (5 ) AISC, After By-product Credits, per Gold Ounce $ 1,773 $ — $ 1,773 79 In thousands (except per ounce amounts) Year Ended December 31, 2022 Total Silver Total Gold Total Total cost of sales $ 349,316 $ 253,433 $ 602,749 Depreciation, depletion and amortization (82,615 ) (61,323 ) (143,938 ) Treatment costs 56,441 1,866 58,307 Change in product inventory 7,934 186 8,120 Exclusion of Nevada Operations and Other — (4,174 ) (4,174 ) Reclamation and other costs (2,523 ) (819 ) (3,342 ) Cash Cost, Before By-product Credits (1) 328,553 189,169 517,722 Reclamation and other costs 3,949 819 4,768 Sustaining capital 74,345 36,883 111,228 General and administrative 43,384 — 43,384 AISC, Before By-product Credits (1) 450,231 226,871 677,102 By-product credits: Zinc (141,442 ) — (141,442 ) Gold (75,596 ) — (75,596 ) Lead (82,368 ) — (82,368 ) Silver — (610 ) (610 ) Total By-product credits (299,406 ) (610 ) (300,016 ) Cash Cost, After By-product Credits $ 29,147 $ 188,559 $ 217,706 AISC, After By-product Credits $ 150,825 $ 226,261 $ 377,086 Divided by ounces produced 14,155 128 Cash Cost, Before By-product Credits, per Ounce $ 23.21 $ 1,483 By-product credits per ounce (21.15 ) (5 ) Cash Cost, After By-product Credits, per Ounce $ 2.06 $ 1,478 AISC, Before By-product Credits, per Ounce $ 31.81 $ 1,778 By-product credits per ounce (21.15 ) (5 ) AISC, After By-product Credits, per Ounce $ 10.66 $ 1,773 In thousands (except per ounce amounts) Year Ended December 31, 2021 Greens Creek Lucky Friday (2) Corporate and other (3) Total Silver Total cost of sales $ 213,113 $ 97,538 $ 247 $ 310,898 Depreciation, depletion and amortization (48,710 ) (26,846 ) (152 ) (75,708 ) Treatment costs 36,099 16,723 0 52,822 Change in product inventory 80 (406 ) — (326 ) Reclamation and other costs (3,466 ) (1,039 ) (95 ) (4,600 ) Cash Cost, Before By-product Credits (1) 197,116 85,970 — 283,086 Reclamation and other costs 3,390 1,056 4,446 Sustaining capital 27,582 26,517 210 54,309 General and administrative (5) — — 34,570 34,570 AISC, Before By-product Credits (1) 228,088 113,543 34,780 376,411 By-product credits: Zinc (100,214 ) (19,479 ) — (119,693 ) Gold (72,011 ) — — (72,011 ) Lead (30,922 ) (42,966 ) — (73,888 ) Total By-product credits (203,147 ) (62,445 ) — (265,592 ) Cash Cost, After By-product Credits $ (6,031 ) $ 23,525 $ — $ 17,494 AISC, After By-product Credits $ 24,941 $ 51,098 $ 34,780 $ 110,819 Divided by silver ounces produced 9,243 3,564 12,807 Cash Cost, Before By-product Credits, per Silver Ounce $ 21.33 $ 24.12 $ 22.11 By-product credits per ounce (21.98 ) $ (17.52 ) (20.74 ) Cash Cost, After By-product Credits, per Silver Ounce $ (0.65 ) $ 6.60 $ 1.37 AISC, Before By-product Credits, per Silver Ounce $ 24.68 $ 31.86 $ 29.39 By-product credits per ounce (21.98 ) $ (17.52 ) (20.74 ) AISC, After By-product Credits, per Silver Ounce $ 2.70 $ 14.34 $ 8.65 80 In thousands (except per ounce amounts) Year Ended December 31, 2021 Casa Berardi Nevada Operations (4) Total Gold Total cost of sales $ 229,829 $ 48,945 $ 278,774 Depreciation, depletion and amortization (80,744 ) (15,341 ) (96,085 ) Treatment costs 1,513 1,731 3,244 Change in product inventory 2,439 (10,907 ) (8,468 ) Reclamation and other costs (841 ) 300 (541 ) Cash Cost, Before By-product Credits (1) 152,196 24,728 176,924 Reclamation and other costs 841 1,008 1,849 Sustaining capital 30,643 511 31,154 AISC, Before By-product Credits (1) 183,680 26,247 209,927 By-product credits: Silver (839 ) (1,152 ) (1,991 ) Total By-product credits (839 ) (1,152 ) (1,991 ) Cash Cost, After By-product Credits $ 151,357 $ 23,576 $ 174,933 AISC, After By-product Credits $ 182,841 $ 25,095 $ 207,936 Divided by gold ounces produced 135 21 155 Cash Cost, Before By-product Credits, per Gold Ounce $ 1,131 $ 1,193 $ 1,140 By-product credits per ounce (6 ) (56 ) (13 ) Cash Cost, After By-product Credits, per Gold Ounce $ 1,125 $ 1,137 $ 1,127 AISC, Before By-product Credits, per Gold Ounce $ 1,365 $ 1,267 $ 1,354 By-product credits per ounce (6 ) (56 ) (13 ) AISC, After By-product Credits, per Gold Ounce $ 1,359 $ 1,211 $ 1,341 In thousands (except per ounce amounts) Year Ended December 31, 2021 Total Silver Total Gold Total Total cost of sales $ 310,898 $ 278,774 $ 589,672 Depreciation, depletion and amortization (75,708 ) (96,085 ) (171,793 ) Treatment costs 52,822 3,244 56,066 Change in product inventory (326 ) (8,468 ) (8,794 ) Reclamation and other costs (4,600 ) (541 ) (5,141 ) Cash Cost, Before By-product Credits (1) 283,086 176,924 460,010 Reclamation and other costs 4,446 1,849 6,295 Sustaining capital 54,309 31,154 85,463 General and administrative 34,570 — 34,570 AISC, Before By-product Credits (1) 376,411 209,927 586,338 By-product credits: Zinc (119,693 ) — (119,693 ) Gold (72,011 ) — (72,011 ) Lead (73,888 ) — (73,888 ) Silver — (1,991 ) (1,991 ) Total By-product credits (265,592 ) (1,991 ) (267,583 ) Cash Cost, After By-product Credits $ 17,494 $ 174,933 $ 192,427 AISC, After By-product Credits $ 110,819 $ 207,936 $ 318,755 Divided by ounces produced 12,807 155 Cash Cost, Before By-product Credits, per Ounce $ 22.11 $ 1,140 By-product credits per ounce (20.74 ) (13 ) Cash Cost, After By-product Credits, per Ounce $ 1.37 $ 1,127 AISC, Before By-product Credits, per Ounce $ 29.39 $ 1,354 By-product credits per ounce (20.74 ) (13 ) AISC, After By-product Credits, per Ounce $ 8.65 $ 1,341 (1) Includes all direct and indirect operating costs related to the physical activities of producing metals, including mining, processing and other plant costs, third-party refining and marketing expense, on-site general and administrative costs and royalties, before by-product revenues earned from all metals other than the primary metal produced at each operation.
The Casa Berardi, Nevada Operations and combined gold properties information below reports Cash Cost, After By-product Credits, per Ounce and AISC, After By-product Credits, per Ounce for the production of gold, their primary product, and by-product revenues earned from silver, which is a by-product at Casa Berardi and the Nevada Operations.
The Casa Berardi and Nevada Operations and combined gold properties information below reports Cash Cost, After By-product Credits, per Gold Ounce and AISC, After By-product Credits, per Gold Ounce for the production of gold, their primary product, and by-product revenues earned from silver, which is a by-product at Casa Berardi and Nevada Operations.
Due to the time elapsed between shipment of concentrates to the customer and final settlement with the 78 customer, we must estimate the prices at which sales of our metals will be settled. Previously recorded sales and trade accounts receivable are adjusted to estimated settlement prices until final settlement by the customer.
Due to the time elapsed between shipment of concentrates to the customer and final settlement with the customer, we must estimate the prices at which sales of our metals will be settled. Previously recorded sales and trade accounts receivable are adjusted to estimated settlement prices until final settlement by the customer.
Our expenditures for these items and our related plans for 2023 may change based upon our financial position, metals prices, and other considerations. Our ability to fund the activities described above will depend on our operating performance, metals prices, our ability to estimate revenues and costs, sources of liquidity available to us, including the revolving credit facility, and other factors.
Our expenditures for these items and our related plans for 2024 may change based upon our financial position, metals prices, and other considerations. Our ability to fund the activities described above will depend on our operating performance, metals prices, our ability to estimate revenues and costs, sources of liquidity available to us, including the revolving credit facility, and other factors.
As a result, the 2022 effective tax rate could vary significantly from that of 2021. The other relevant provisions of the TCJA that became effective in 2018 consist of global intangible low-taxed income tax and base erosion and anti-abuse tax; however, these provisions have not materially impacted us.
As a result, the 2023 effective tax rate could vary significantly from that of 2022. The other relevant provisions of the TCJA that became effective in 2018 consist of global intangible low-taxed income tax and base erosion and anti-abuse tax; however, these provisions have not materially impacted us.
As discussed in Note 14 of Notes to Consolidated Financial Statements , we are involved in various other legal proceedings which may result in obligations in excess of provisions we have made. Critical Accounting Estimates Our significant accounting policies are described in Note 2 of Notes to Consolidated Financial Statements.
As discussed in Note 16 of Notes to Consolidated Financial Statements , we are involved in various other legal proceedings which may result in obligations in excess of provisions we have made. Critical Accounting Estimates Our significant accounting policies are described in Note 2 of Notes to Consolidated Financial Statements.
The IQ Notes bear interest on amounts outstanding at a rate of 6.515% per year, payable on January 9 and July 9 of each year, commencing January 9, 2021. See Note 8 of Notes to Consolidated Financial Statements for more information. 77 We record liabilities for estimated costs associated with mine closure, reclamation of land and other environmental matters.
The IQ Notes bear interest on amounts outstanding at a rate of 6.515% per year, payable on January 9 and July 9 of each year, commencing January 9, 2021. For more information, see Note 9 of Notes to Consolidated Financial Statements. 85 We record liabilities for estimated costs associated with mine closure, reclamation of land and other environmental matters.
In addition to the uses described above, Cash Cost, After By-product Credits, per Ounce and AISC, After By-product Credits, per Ounce provide management and investors an indication of operating cash flow and net cash flow, respectively, after consideration of the average price received from production.
In addition to the uses described above, Cash Cost, After By-product Credits, per Ounce and AISC, After By-product Credits, per Ounce provide management and investors an indication of operating cash flow, after consideration of the average price received from production.
We also purchased shares of our common stock for $3.7 million, $4.5 million, and $2.7 million in 2022, 2021, and 2020, respectively, as a result of our employees' election to utilize net share settlement to satisfy their tax withholding obligations related to incentive compensation paid in stock and vesting of restricted stock units.
We also purchased shares of our common stock for $2.0 million, $3.7 million, and $4.5 million in 2023, 2022, and 2021, respectively, as a result of our employees' election to utilize net share settlement to satisfy their tax withholding obligations related to incentive compensation paid in stock and vesting of restricted stock units.
For additional information relating to our environmental obligations, see Note 4 of Notes to Consolidated Financial Statements and Item 1A. Risk Factors – Our environmental obligations may exceed the provisions we have made .
For additional information relating to our environmental obligations, see Note 5 of Notes to Consolidated Financial Statements and Item 1A. Risk Factors – Our environmental obligations may exceed the provisions we have made .
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities for more information). We do not expect to be required to contribute to our defined benefit plans in 2023, but we may choose to do so. See Note 5 of Notes to Consolidated Financial Statements for more information.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities for more information). We do not expect to be required to contribute to our defined benefit plans in 2024, but we may choose to do so. See Note 6 of Notes to Consolidated Financial Statements for more information.
Changes in metals prices between shipment and final settlement result in changes to revenues and accounts receivable previously recorded upon shipment. As a result, our trade accounts receivable balances related to concentrate sales are subject to changes in metals prices until final settlement occurs. For more information, see Note 3 of Notes to Consolidated Financial Statements .
Changes in metals prices between shipment and final 86 settlement result in changes to revenues and accounts receivable previously recorded upon shipment. As a result, our trade accounts receivable balances related to concentrate sales are subject to changes in metals prices until final settlement occurs. For more information, see Note 4 of Notes to Consolidated Financial Statements .
Thus, the gold produced at Casa Berardi and Nevada Operations is not included as a by-product credit when calculating Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce for the total of Greens Creek, Lucky Friday and San Sebastian, our combined silver properties.
Thus, the gold produced at our Casa Berardi and Nevada Operations units is not included as a by-product credit when calculating Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce for the total of Greens Creek and Lucky Friday, our combined silver properties.
Only costs and ounces produced relating to operations with the same primary product are combined to represent Cash Cost, After By-product Credits, per Ounce and AISC, After By-product Credits, per Ounce.
Only costs and ounces produced relating to units with the same primary product are combined to represent Cash Cost, After By-product Credits, per Ounce and AISC, After By-product Credits, per Ounce.
Reconciliation o f Total Cost of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) The tables below present reconciliations between the most comparable GAAP measure of total cost of sales to the non-GAAP measures of (i) Cash Cost, Before By-product Credits, (ii) Cash Cost, After By-product Credits, (iii) AISC, Before By-product Credits and (iv) AISC, After By-product Credits for our operations and for the Company for the years ended December 31, 2022, 2021 and 2020.
Reconciliation of Total Cost of Sales to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP) The tables below present reconciliations between the most comparable GAAP measure of total cost of sales to the non-GAAP measures of (i) Cash Cost, Before By-product Credits, (ii) Cash Cost, After By-product Credits, (iii) AISC, Before By-product Credits and (iv) AISC, After By-product Credits for our operations and for the Company for the years ended December 31, 2023, 2022 and 2021.
As a result of the Alexco acquisition, we assumed a cash balance of $9.0 million, net of transaction costs of $5.1 million having advanced $25.0 million to Alexco pre-acquisition, to enable them to fund development of the Keno Hill mining district prior to acquisition closing.
As a result of the Alexco acquisition, we assumed a cash balance of $9.0 million, net of transaction costs of $5.1 million, however, we had previously advanced $25.0 million to Alexco pre-acquisition, to enable them to fund development of the Keno Hill mining district prior to acquisition closing.
As a result of our current cash balances, the performance of our current and expected operations, current metals prices, proceeds from potential at-the-market sales of common stock, and availability under our New Credit Agreement (as defined in Note 8 of Notes to Consolidated Financial Statements) , we believe we will be able to meet our obligations and other potential cash requirements during the next 12 months from the date of this report.
As a result of our current cash balances, the performance of our current and expected operations, current metals prices, proceeds from potential at-the-market sales of common stock, and availability under our Credit Agreement (refer to Note 9 of Notes to Consolidated Financial Statements) , we believe we will be able to meet our obligations and other potential cash requirements during the next 12 months from the date of this report.
Our obligations and other uses of cash may include, but are not limited to: debt service obligations related to the Senior Notes and our Series 2020-A Senior Notes due July 9, 2025 (the “IQ Notes”) issued to Investissement Québec, a financing arm of the Québec government, which have total principal of CAD$48.2 million and bear interest at a rate of 6.515%; principal and interest payments under our New Credit Agreement; deferral of revenues, care-and-maintenance and other costs related to addressing the impacts of COVID-19 on our operations; capital expenditures at our operations; potential acquisitions of other mining companies or properties; regulatory matters; litigation; potential repurchases of our common stock under the program described above; and payment of dividends on common stock, if declared by our board of directors.
Our obligations and other uses of cash may include, but are not limited to: debt service obligations related to the Senior Notes and our Series 2020-A Senior Notes due July 9, 2025 (the “IQ Notes”) issued to Investissement Québec, a financing arm of the Québec government, which have total principal of CAD$48.2 million and bear interest at a rate of 6.515%; principal and interest payments under our Credit Agreement; deferral of revenues, ramp-up and suspension costs at certain of our operations; capital expenditures at our operations; potential acquisitions of other mining companies or properties; regulatory matters; litigation; potential repurchases of our common stock under the program described above; and payment of dividends on common stock, if declared by our board of directors.
We use AISC, After By-product Credits, per Ounce as a measure of our mines' net cash flow after costs for exploration, pre-development, reclamation, and sustaining capital. This is similar to the Cash Cost, After By-product Credits, per Ounce non-GAAP measure we report, but also includes on-site exploration, reclamation, and sustaining capital costs.
We use AISC, After By-product Credits, per Ounce as a measure of our mines' net cash flow after costs for reclamation and sustaining capital. This is similar to the Cash Cost, After By-product Credits, per Ounce non-GAAP measure we report, but also includes reclamation and sustaining capital costs.
AISC, Before By-product Credits for each mine also includes on-site exploration, reclamation, and sustaining capital costs. AISC, Before By-product Credits for our consolidated silver properties also includes corporate costs for general and administrative expense and sustaining exploration and capital costs. By-product credits include revenues earned from all metals other than the primary metal produced at each operation.
AISC, Before By-product Credits for each mine also includes reclamation and sustaining capital costs. AISC, Before By-product Credits for our consolidated silver properties also includes corporate costs for general and administrative expense and sustaining capital costs. By-product credits include revenues earned from all metals other than the primary metal produced at each unit.
See Note 11 of Notes to Consolidated Financial Statements for more information. Exchange rate fluctuations between the U.S. dollar and the Canadian dollar and Mexican peso resulted in decreases in our cash balance of $0.3 million, $0.5 million and $1.1 million, during 2022, 2021 and 2020, respectively.
See Note 12 of Notes to Consolidated Financial Statements for more information. Exchange rate fluctuations between the U.S. dollar and the Canadian dollar and Mexican peso resulted in an increase in our cash balance of $1.1 million, and decreases of $0.3 million and $0.5 million, during 2023, 2022 and 2021, respectively.
(6) On July 9, 2020, we entered into a note purchase agreement pursuant to which we issued our IQ Notes for CAD$50 million (approximately USD$36.8 million at the time of the transaction) in aggregate principal amount.
For more information, see Note 9 of Notes to Consolidated Financial Statements. (6) On July 9, 2020, we entered into a note purchase agreement pursuant to which we issued our IQ Notes for CAD$50 million (approximately USD$36.8 million at the time of the transaction) in aggregate principal amount.
At December 31, 2022, our liabilities for these matters totaled $117.0 million. Future expenditures related to closure, reclamation and environmental expenditures at our other sites are difficult to estimate, although we anticipate we will incur expenditures relating to these obligations over the next 30 years.
At December 31, 2023, our liabilities for these matters totaled $120.5 million. Future expenditures related to closure, reclamation and environmental expenditures at our other sites are difficult to estimate, although we anticipate we will incur expenditures relating to these obligations over the next 30 years.
We currently estimate a range of approximately $190 to $200 million will be spent in 2023 on capital expenditures, primarily for equipment, infrastructure, and development at our mines, before any lease financing. We also estimate exploration and pre-development expenditures will total approximately $33 million in 2023.
We currently estimate a range of approximately $190 to $210 million will be spent in 2024 on capital expenditures, primarily for equipment, infrastructure, and development at our mines, before any lease financing. We also estimate exploration and pre-development expenditures will total approximately $32 million in 2024.
Pursuant to our common stock dividend policy described in Note 11 of Notes to Consolidated Financial Statements , our Board of Directors declared and paid dividends on common stock totaling $12.4 million in 2022, $20.1 million in 2021 and $8.6 million in 2020.
Pursuant to our common stock dividend policy described in Note 12 of Notes to Consolidated Financial Statements , our Board of Directors declared and paid dividends on common stock totaling $15.2 million in 2023, $12.4 million in 2022 and $20.1 million in 2021.
Risk Factors - An extended decline in metals prices, an increase in operating or capital costs, or treatment charges, mine accidents or closures, increasing regulatory obligations, or our inability to convert resources or exploration targets to reserves may cause us to record write-downs, which could negatively impact our results of operations and We have a substantial amount of debt that could impair our financial health and prevent us from fulfilling our obligations under our existing and future indebtedness. 75 We may defer some capital expenditures and/or exploration and pre-development activities, engage in asset sales or secure additional capital if necessary to maintain liquidity.
Risk Factors - An extended decline in metals prices, an increase in operating or capital costs, or treatment charges, mine accidents or closures, increasing regulatory obligations, or our inability to convert resources or exploration targets to reserves may cause us to record write-downs, which could negatively impact our results of operations and We have a substantial amount of debt that could impair our financial health and prevent us from fulfilling our obligations under our existing and future indebtedness.
We issued stock under our ATM program described above for net proceeds of $17.3 million in 2022.
We issued stock under our ATM program described above for net proceeds of $56.7 million and $17.3 million in 2023 and 2022, respectively.
In 2021 a release of valuation allowance of $58.4 million was recorded, based on a change in circumstances and weight of applicable evidence reviewed to support a more likely than not conclusion for utilization of the deferred tax assets.
The decrease of $18.1 million is primarily related to utilization of tax loss carryforward and reduction of deferred tax liabilities. In 2021 a release of valuation allowance of $58.4 million was recorded, based on a change in circumstances and weight of applicable evidence reviewed to support a more likely than not conclusion for utilization of the deferred tax assets.
The amounts in the table above assume no additional amounts will be drawn in future periods, and include only the standby fee on the current undrawn balance under the New Credit Agreement. For more information on our credit facility, see Note 8 of Notes to Consolidated Financial Statements.
The amounts in the table above assumes no additional amounts will be drawn in future periods, and includes only the standby fee on the current undrawn balance and accrued interest. For more information on our Credit Agreement, see Note 9 of Notes to Consolidated Financial Statements.
Uncertainty related to (i) the political environment in the U.S., (ii) U.S. and global trading policies (including tariffs), (iii) a global economic recovery, (iv) recent uncertainty in China and (v) from the current downturn and continued uncertainty resulting from the COVID-19 outbreak and any subsequent variants, could result in continued investment demand for precious metals.
Uncertainty related to (i) the political environment in the U.S., (ii) U.S. and global trading policies (including tariffs), (iii) a global economic recovery, and (iv) recent uncertainty in China, could result in continued investment demand for precious metals.
In the past, we have recorded impairments to our asset carrying values because of low prices, and we can offer no assurance that prices will either remain at their current levels or increase.
There can be no assurance whether these trends will continue or how they will impact prices of the metals we produce. In the past, we have recorded impairments to our asset carrying values because of low prices, and we can offer no assurance that prices will either remain at their current levels or increase.
Year Ended December 31, 2022 2021 2020 Cash provided by operating activities (in millions) $ 89.9 $ 220.3 $ 180.8 Cash provided by operating activities decreased by $130.4 million in 2022 compared to 2021.
Year Ended December 31, 2023 2022 2021 Cash provided by operating activities (in millions) $ 75.5 $ 89.9 $ 220.3 Cash provided by operating activities decreased by $14.4 million in 2023 compared to 2022.
As discussed in Note 6 of Notes to Consolidated Financial Statements, our effective tax rate for 2022 was 17%, reflecting a tax benefit of $7.6 million on pre-tax loss of $44.9 million, compared to (535)% for 2021, reflecting a tax benefit of $29.6 million on a pre-tax income of $5.5 million.
As discussed in Note 7 of Notes to Consolidated Financial Statements , our effective tax rate for 2023 was negative 1%, reflecting a tax expense of $1.2 million on pre-tax loss of $83.0 million, compared to 17% for 2022, reflecting a tax benefit of $7.6 million on a pre-tax loss of $44.9 million.
Any sales of shares under the equity distribution agreement are registered under the Securities Act of 1933, as amended, pursuant to a shelf registration statement on Form S-3. As of December 31, 2022, we had sold 3,860,199 shares under the agreement for proceeds of $17.3 million, net of commissions and fees of approximately $0.3 million.
Any sales of shares under the equity distribution agreement are registered under the Securities Act of 1933, as amended, pursuant to a shelf registration statement on Form S-3. During March, April and December 2023, we sold 10,645,198 shares under the agreement for proceeds of $56.7 million, net of commissions and fees of approximately $0.9 million.
Year Ended December 31, 2022 2021 2020 Cash used in investing activities (in millions) $ (187.3 ) $ (107.0 ) $ (92.9 ) Capital expenditures were $149.4 million in 2022, which was $40.3 million higher than 2021 excluding $11.9 million in non-cash finance lease additions.
Year Ended December 31, 2023 2022 2021 Cash used in investing activities (in millions) $ (231.3 ) $ (187.3 ) $ (107.0 ) Capital expenditures, excluding $16.1 million in non-cash finance lease additions, were $223.9 million in 2023, which was $74.5 million higher than 2022.
The Senior Notes bear interest at a rate of 7.25% per year with interest payable on February 15 and August 15 of each year, commencing August 15, 2020. See Note 8 of Notes to Consolidated Financial Statements for more information.
For more information, see Note 9 of Notes to Consolidated Financial Statements. (5) On February 19, 2020, we completed an offering of $475 million in aggregate principal amount of our Senior Notes. The Senior Notes bear interest at a rate of 7.25% per year with interest payable on February 15 and August 15 of each year, commencing August 15, 2020.
In 2022, 2021 and 2020, we paid total cash dividends on our common and preferred stock of $12.9 million, $20.7 million and $9.2 million, respectively. We made payments on our finance leases of $7.6 million, $7.3 million, and $6.0 million in 2022, 2021, and 2020, respectively.
We had no borrowings or repayments of debt during 2021. In 2023, 2022 and 2021, we paid total cash dividends on our common and preferred stock of $15.7 million, $12.9 million and $20.7 million, respectively. We made payments on our finance leases of $10.6 million, $7.6 million, and $7.3 million in 2023, 2021, and 2021, respectively.
As a result, on May 5, 2022, August 4, 2022, and February 10, 2023, our Board of Directors declared quarterly cash dividends of $0.00625 per share of common stock, consisting of $0.00375 per share for the minimum dividend component and $0.0025 per share for the silver-linked dividend component of our dividend policy.
As a result, on May 10, 2023, August 8, 2023, November 6, 2023, and February 13, 2024 our Board of Directors declared quarterly cash dividends of $0.00625 per share of common stock, consisting of $0.00375 per share for the minimum dividend component and $0.0025 per share for the silver-linked dividend component of our dividend policy. 82 For illustrative purposes only, the table below summarizes potential dividend amounts under our dividend policy.
At December 31, 2022, we had $104.7 million in cash and cash equivalents, of which $17.9 million was held in foreign subsidiaries' local currency denominated accounts readily convertible to U.S. dollars that we anticipate utilizing for near-term operating, exploration or capital costs by those foreign operations.
At December 31, 2023, we had $106.4 million in cash and cash equivalents, of which $7.6 million was held in foreign subsidiaries' local currency that we anticipate utilizing for near-term operating, exploration or capital costs by those foreign subsidiaries.
Our liquid assets excluding restricted cash include (in millions): December 31, 2022 December 31, 2021 December 31, 2020 Cash and cash equivalents held in U.S. dollars $ 86.8 $ 196.2 $ 116.4 Cash and cash equivalents held in foreign currency 17.9 13.8 13.4 Total cash and cash equivalents 104.7 210.0 129.8 Marketable equity securities, current and non-current 24.0 14.4 19.3 Total cash, cash equivalents and investments $ 128.7 $ 224.4 $ 149.1 Cash and cash equivalents decreased by $105.3 million in 2022, for the reasons discussed below.
We cannot assure you that such financing will be available to us. 83 Our liquid assets excluding restricted cash and cash equivalents include (in millions): December 31, 2023 December 31, 2022 December 31, 2021 Cash and cash equivalents held in U.S. dollars $ 98.8 $ 86.8 $ 196.2 Cash and cash equivalents held in foreign currency 7.6 17.9 13.8 Total cash and cash equivalents 106.4 104.7 210.0 Marketable equity securities 33.7 24.0 14.4 Total cash, cash equivalents and investments $ 140.1 $ 128.7 $ 224.4 Cash and cash equivalents increased by $1.7 million in 2023, for the reasons discussed below.
We realized silver prices of $24.68, $20.68, $18.30 and $22.03 in the first, second, third and fourth quarters of 2022, respectively, thus satisfying the criterion for the silver-linked dividend component of our common stock dividend policy, with the exception of the third quarter.
We realized silver prices of $22.62, $23.67, $23.71 and $23.47 in the first, second, third and fourth quarters of 2023, respectively, thus satisfying the criterion for the silver-linked dividend component of our common stock dividend policy.
Cash provided by operating activities increased by $39.5 million in 2021 compared to 2020. The increase was due to higher income, adjusted for non-cash items, partially offset by the impact of working capital and other operating asset and liability changes.
Cash provided by operating activities decreased by $130.4 million in 2022 compared to 2021. The decrease was due to lower income, adjusted for non-cash items, further compounded by the negative impact of working capital and other operating asset and liability changes.
Similarly, the silver produced at our other two operations is not included as a by-product credit when calculating the gold metrics for Casa Berardi and the Nevada Operations. As depicted in the tables below, by-product credits from the silver production at our primary gold properties comprise an element of our gold unit cost structure.
Similarly, the silver produced at our other two units is not included as a by-product credit when calculating the gold metrics for Casa Berardi and Nevada Operations.
We are relying on all available evidence including reversal of deferred taxable temporary differences and a forecast of future taxable income along with a history of positive earnings to support the release. Our net U.S. deferred tax liability in the Nevada U.S. Group is $30.7 million at December 31, 2022 compared to $31.5 million at December 31, 2021.
We are relying on all available evidence including reversal of deferred taxable temporary differences and a forecast of future taxable income along with a history of positive earnings to support the release. 74 Klondex Mines Ltd (“Klondex”) is a separate U.S. tax group (“Nevada U.S.
Our Mexican net deferred tax asset at December 31, 2022 remains at zero with no change from December 31, 2021. The valuation allowance increased $2.4 million due to inability to recognize the benefit of tax losses incurred related to exploration activities at our operations in Mexico.
The valuation allowance increased $13.2 million due to inability to recognize the benefit of tax losses incurred related to exploration activities at our operations in Mexico.
Year Ended December 31, 2022 2021 2020 Cash used in financing activities (in millions) $ (7.5 ) $ (32.6 ) $ (19.4 ) 76 During 2022, we drew down and repaid $25.0 million on our New Credit Agreement. We had no borrowings or repayments of debt during 2021.
Year Ended December 31, 2023 2022 2021 Cash provided by (used in) financing activities (in millions) $ 156.3 $ (7.5 ) $ (32.6 ) 84 During 2023, we drew down a cumulative $239 million and repaid a cumulative $111 million on our Credit Agreement. During 2022, we drew down and repaid $25.0 million on our Credit Agreement.
Similarly, these statistics are useful in identifying acquisition and investment opportunities as they provide a common tool for measuring the financial performance of other mines with varying geologic, metallurgical and operating characteristics. 68 Cash Cost, Before By-product Credits and AISC, Before By-product Credits include all direct and indirect operating cash costs related directly to the physical activities of producing metals, including mining, processing and other plant costs, third-party refining expense, on-site general and administrative costs and royalties.
Cash Cost, Before By-product Credits and AISC, Before By-product Credits include all direct and indirect operating cash costs related directly to the physical activities of producing metals, including mining, processing and other plant costs, third-party refining expense, on-site general and administrative costs, royalties and mining production taxes.
Cash and cash equivalents held in foreign currencies represents balances in CAD and Mexican Pesos (“MXN”), and increased by $4.1 million in 2022 due to an increase in CAD held. The value of current and non-current marketable equity securities increased by $9.6 million.
Cash and cash equivalents held in foreign currencies represents balances in CAD, and decreased by $10.3 million in 2023 due to a decrease in CAD held at our Canadian operations. The value of current and non-current marketable equity securities increased by $9.7 million.
(2) The New Credit Agreement provides for a $150 million revolving credit facility, under which $25 million was drawn as of September 30, 2022 and repaid October 4, 2022 . We had $7.8 million in letters of credit outstanding as of December 31, 2022.
(2) The Credit Agreement provides for a $150 million revolving credit facility. We had net draws of $128 million and $6.9 million in letters of credit outstanding as of December 31, 2023.
(3) Includes results for San Sebastian, which was an operating segment prior to 2021, and corporate costs. AISC, Before By-product Credits for our consolidated silver properties includes non-discretionary corporate costs for general and administrative expense, exploration and sustaining capital.
AISC, Before By-product Credits also includes reclamation and sustaining capital costs. 81 (2) AISC, Before By-product Credits for our consolidated silver properties includes corporate costs for general and administrative expense and sustaining capital.
Contractual Obligations and Contingent Liabilities and Commitments The table below presents our fixed, non-cancelable contractual obligations and commitments primarily related to our Senior Notes, IQ Notes, revolving credit facility, outstanding purchase orders and certain service contract commitments, and lease arrangements as of December 31, 2022 (in thousands): Payments Due By Period Less than 1 year 2-3 years 4-5 years After 5 years Total Purchase and contractual obligations (1) $ 40,831 $ — $ — $ — $ 40,831 Commitment fees (2) 1,717 179 179 — $ 2,075 Finance lease commitments (3) 9,352 10,993 1,875 — $ 22,220 Operating lease commitments (4) 3,167 2,559 2,445 6,408 $ 14,579 Senior Notes (5) 34,438 68,876 68,876 479,302 $ 651,492 IQ Notes (6) 2,320 39,132 — — $ 41,452 Total contractual cash obligations $ 91,825 $ 121,739 $ 73,375 $ 485,710 $ 772,649 (1) Consists of open purchase orders and commitments of approximately $9.8 million at Greens Creek, $1.7 million at Casa Berardi, $22.8 million at Lucky Friday, $1.9 million at the Nevada Operations and $4.5 million at Keno Hill.
Contractual Obligations and Contingent Liabilities and Commitments The table below presents our fixed, non-cancelable contractual obligations and commitments primarily related to our Senior Notes, IQ Notes, revolving credit facility, outstanding purchase orders and certain service contract commitments, and lease arrangements as of December 31, 2023 (in thousands): Payments Due By Period Less than 1 year 2-3 years 4-5 years After 5 years Total Purchase and contractual obligations (1) $ 36,488 $ — $ — $ — $ 36,488 Credit Agreement (2) 128,114 284 — — $ 128,398 Finance lease commitments (3) 11,172 13,501 5,119 — $ 29,792 Operating lease commitments (4) 1,290 2,556 2,204 5,566 $ 11,616 Senior Notes (5) 34,438 68,876 513,741 — $ 617,055 IQ Notes (6) 2,376 37,704 — — $ 40,080 Total contractual cash obligations $ 213,878 $ 122,921 $ 521,064 $ 5,566 $ 863,429 (1) Consists of open purchase orders and commitments of approximately $11.4 million, $8.1 million, $10.7 million, $2.8 million and $3.5 million for various capital and non-capital items at Greens Creek, Lucky Friday, Keno Hill, Casa Berardi and Nevada Operations, respectively.
Quarterly Average Realized Silver Price ($ per ounce) Quarterly Silver-Linked Dividend ($ per share) Annualized Silver-Linked Dividend ($ per share) Annualized Minimum Dividend ($ per share) Annualized Dividends per Share: Silver-Linked and Minimum ($ per share) $ — $ — $ 0.015 $ 0.015 $20 $ 0.0025 $ 0.01 $ 0.015 $ 0.025 $25 $ 0.0100 $ 0.04 $ 0.015 $ 0.055 $30 $ 0.0150 $ 0.06 $ 0.015 $ 0.075 $35 $ 0.0250 $ 0.10 $ 0.015 $ 0.115 $40 $ 0.0350 $ 0.14 $ 0.015 $ 0.155 $45 $ 0.0450 $ 0.18 $ 0.015 $ 0.195 $50 $ 0.0550 $ 0.22 $ 0.015 $ 0.235 The declaration and payment of dividends on common stock is at the sole discretion of our board of directors, and there can be no assurance that we will continue to declare and pay common stock dividends in the future.
Quarterly Average Realized Silver Price ($ per ounce) Quarterly Silver-Linked Dividend ($ per share) Annualized Silver-Linked Dividend ($ per share) Annualized Minimum Dividend ($ per share) Annualized Dividends per Share: Silver-Linked and Minimum ($ per share) $ — $ — $ 0.015 $ 0.015 $20 $ 0.0025 $ 0.01 $ 0.015 $ 0.025 $25 $ 0.0100 $ 0.04 $ 0.015 $ 0.055 $30 $ 0.0150 $ 0.06 $ 0.015 $ 0.075 $35 $ 0.0250 $ 0.10 $ 0.015 $ 0.115 $40 $ 0.0350 $ 0.14 $ 0.015 $ 0.155 $45 $ 0.0450 $ 0.18 $ 0.015 $ 0.195 $50 $ 0.0550 $ 0.22 $ 0.015 $ 0.235 As discussed in Note 12 of Notes to Consolidated Financial Statements , pursuant to an equity distribution agreement dated February 18, 2021, we may offer and sell up to 60 million shares of our common stock from time to time to or through sales agents in “at-the-market” (ATM) offerings.
See Note 8 of Notes to Consolidated Financial Statements for more information. (4) We enter into operating leases in the normal course of business. Substantially all lease agreements have fixed payment terms based on the passage of time. Some lease agreements provide us with the option to renew the lease or purchase the leased property.
Substantially all lease agreements have fixed payment terms based on the passage of time. Some lease agreements provide us with the option to renew the lease or purchase the leased property. Our future operating lease obligations would change if we exercised these renewal options and if we entered into additional operating lease arrangements.
Costs related to ramp-up activities totaling approximately $8.0 million in 2020 and includes $6.3 million in non-cash depreciation expense for that period, have been excluded from the calculations of total cost of sales, Cash Cost, Before By-product Credits, Cash Cost, After By-product Credits, AISC, Before By-product Credits, and AISC, After By-product Credits.
(6) Keno Hill is in the production ramp-up phase and $29.8 million of ramp-up costs are excluded from the calculation of total cost of sales, Cash Cost, Before By-product Credits, Cash Cost, After By-product Credits, AISC, Before By-product Credits, and AISC, After By-product Credits.
Income, adjusted for non-cash items, was higher by $42.9 million primarily due to higher income from operations, which was mainly a result of higher realized silver, gold, lead and zinc prices and lower treatment charges.
Income, adjusted for non-cash items, was lower by $4.8 million primarily due to increased loss from operations, which was mainly a result of higher ramp-up and suspension costs associated with continued ramp-up at Keno Hill and suspension of operations at Lucky Friday.
We also have USD cash and cash equivalent balances held by our foreign subsidiaries that, if repatriated to the United States, may be subject to withholding taxes. We expect that there would be no additional tax burden upon repatriation after considering the cash cost associated with the withholding taxes.
We expect that there would be no additional tax burden upon repatriation after considering the cash cost associated with the withholding taxes. Our liquidity and capital resources are reliant on our revolving credit facility and other financing activities in addition to cash provided by our operations.
(3) Includes scheduled finance lease payments of $13.4 million, $4.9 million, $1.2 million and $2.7 million (including interest) for equipment at Greens Creek, Lucky Friday, Casa Berardi and Keno Hill, respectively. These leases have fixed payment terms and contain bargain purchase options at the end of the lease periods.
(3) Includes scheduled finance lease payments of $7.6 million, $6.3 million, $8.2 million, and $7.7 million for equipment at Greens Creek, Lucky Friday, Casa Berardi, and Keno Hill, respectively. For more information, see Note 9 of Notes to Consolidated Financial Statements. (4) We enter into operating leases in the normal course of business.
Working capital and other operating asset and liability changes resulted in a net cash increase of $18.9 million in 2021 compared to an increase in cash of $22.4 million in 2020.
Working capital and other operating asset and liability changes resulted in a net cash decrease of $9.6 million in 2023 compared to 2022. Significant variances in working capital changes between 2023 and 2022 resulted from lower cash flows from changes in other current and non-current assets and accrued payroll and related benefits.
The decrease of $0.8 million is primarily related to deferral of interest expense deduction. Our net Canadian deferred tax liability at December 31, 2022 was $95.2 million, a decrease of $9 million from the $104.2 million net deferred tax liability at December 31, 2021.
Our net Canadian deferred tax liability at December 31, 2023 was $74.1 million, a decrease of $21.1 million from the $95.2 million net deferred tax liability at December 31, 2022. The decrease was due to current period activity. Our Mexican net deferred tax asset at December 31, 2023 remains at zero with no change from December 31, 2022.
We also may pursue additional acquisition opportunities, which could require additional equity issuances or other forms of financing. We cannot assure you that such financing will be available to us.
We may defer some capital expenditures and/or exploration and pre-development activities, engage in asset sales or secure additional capital if necessary to maintain liquidity. We also may pursue additional acquisition opportunities, which could require additional equity issuances or other forms of financing.
Suspension-related costs totaling $1.6 million for 2020 are reported in a separate line item on our consolidated statements of operations and excluded from the calculations of total cost of sales and Cash Cost and AISC, each After By-product Credits, per Gold Ounce.
Suspension costs amounted to $2.2 million for the year ended December 31, 2023, and are excluded from the calculation of total cost of sales, Cash Cost, Before By-product Credits, Cash Cost, After By-product Credits, AISC, Before By-product Credits, and AISC, After By-product Credits.
As part of the Alexco acquisition in 2022, we acquired an environmental services business and their cost of sales of $0.5 million are included as Other. (5) Excludes the discretionary portion of 2020 general and administrative costs for Greens Creek, Casa Berardi, Lucky Friday and corporate of $0.6 million, $0.4 million, $0.1 million and $1.8 million, respectively.
(4) Other includes $5.3 million of sales and cost of sales for the year ended December 31, 2023 and $0.5 million of sales and cost of sales for the year ended December 31, 2022, related to the environmental services business acquired as part of the Alexco acquisition.
Capital expenditures were $109.0 million in 2021, including $9.1 million for acquisition of royalty interests and land at our operations and excluding non-cash finance lease additions of $4.9 million, which was $18.0 million higher than 2020. The increase was due to increased spending at Lucky Friday and Casa Berardi.
During 2023, we acquired investments in other mining companies and short term investments for a total of $9.0 million. Capital expenditures, excluding $11.9 million in non-cash finance lease additions, were $149.4 million in 2022, which was $40.3 million higher than 2021.
We periodically examine the defined benefit pension plans and supplemental excess retirement plan for affordability and competitiveness. Income and Mining Taxes Each reporting period we assess our deferred tax balance based on a review of long-range forecasts and quarterly activity. As part of the Klondex Mines Ltd.
We periodically examine the defined benefit pension plans and supplemental excess retirement plan for affordability and competitiveness. Income and Mining Taxes Our deferred tax assets and liabilities are measured at the currently enacted tax rates that are expected to apply in years in which they are expected to be paid for or realized.
Removed
("Klondex") acquisition in July 2018, we acquired a U.S. consolidated tax group (the “Nevada U.S. 67 Group”) that is not consolidated with the existing consolidated U.S. tax group of Hecla Mining Company and subsidiaries (“Hecla U.S. Group”). Our net U.S. deferred tax asset in the Hecla U.S.
Added
Each reporting period we assess the realizability of our tax assets. In assessing the need for a valuation allowance, we evaluate all significant available positive and negative evidence, including historical operating results, estimates of future sources of taxable income, carry-forward periods available, the existence of prudent and feasible tax planning strategies and other relevant factors.
Removed
Group is $21.0 million at December 31, 2022 compared to $31.5 million at December 31, 2021. The decrease of $10.5 million is primarily related to utilization of tax loss carryforward and reduction of deferred tax liabilities.
Added
Our organizational structure requires us to have two U.S. tax groups that do not consolidate. Hecla Mining Company and subsidiaries (“Hecla U.S. Group”) has a net deferred tax asset of $2.9 million at December 31, 2023 compared to $21.0 million at December 31, 2022.
Removed
The decrease was due to current period activity partially offset with the acquisition of Alexco which added $12.0 million deferred tax liability. The deferred tax liability is primarily related to the excess of the carrying value of the mineral resource assets over the tax bases of those assets for Canadian tax reporting.
Added
Group”) that has a net deferred tax liability of $30.8 million and $30.7 million at December 31, 2023 and 2022, respectively. The increase of $0.1 million is due to the tax liability of indefinite life mineral property.
Removed
However, comparability of Cash Cost, After By-product Credits, per Silver Ounce and AISC, After By-product Credits, per Silver Ounce for 2022 to 2021 and 2020 is impacted by, among other factors, (i) the return to full production at Lucky Friday in the fourth quarter of 2020 and (ii) suspension of production at San Sebastian in the fourth quarter of 2020 and discontinuation of San Sebastian being reported as an operating segment in 2021.
Added
Similarly, these statistics are useful in identifying acquisition and investment opportunities as they provide a common tool for measuring the financial performance of other mines with varying geologic, metallurgical and operating characteristics.
Removed
AISC, Before By-product Credits also includes on-site exploration, reclamation, and sustaining capital costs. (2) The unionized employees at Lucky Friday were on strike from March 2017 until January 2020, and production at Lucky Friday had been limited from the start of the strike until the ramp-up was substantially completed in the fourth quarter of 2020.
Added
In addition to the uses described above, Cash Cost, After By-product Credits, per Ounce and AISC, After By-product Credits, per Ounce provide management and investors an indication of operating cash flow, after consideration of the average price received 75 from production.
Removed
(4) Production was suspended at the Hollister mine in the third quarter of 2019 and at the Midas mine and Aurora mill in late 2019, and at the Midas mill and Fire Creek mine in mid-2021.
Added
We also use these measurements for the comparative monitoring of performance of our mining operations period-to-period from a cash flow perspective.
Removed
Suspension-related costs at Nevada Operations totaling $19.7 million for 2022, $20.4 million for 2021 and $13.5 million for 2020 are reported in a separate line item on our consolidated statements of operations and excluded from the calculations of total cost of sales and Cash Cost and AISC, each After By-product Credits, per Gold Ounce for 2021 and 2020.
Added
(3) During the three months ended March 31, 2023, the Company completed the necessary studies to conclude usage of the F-160 pit as a tailings storage facility after mining is complete. As a result, a portion of the mining costs have been excluded from Cash Cost, Before By-product Credits and AISC, Before By-product Credits.
Removed
During the second half of 2020, all ore mined at Nevada Operations was stockpiled, with no ore milled and no production reported during the period. As a result, costs incurred at Nevada Operations during the second half of 2020 were excluded from the calculations of Cash Cost and AISC, each, After By-product Credits, per Gold Ounce.
Added
(5) Prior years presentation has been adjusted to conform with current year presentation to eliminate exploration costs from the calculation of AISC, Before By-product Credits as exploration is an activity directed at the Corporate level to find new mineral reserve and resource deposits, and therefore we believe it is inappropriate to include exploration costs in the calculation of AISC, Before By-product Credits for a specific mining operation.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

16 edited+6 added−12 removed10 unchanged
Biggest changeWe are developing the Keno Hill mine in the Yukon, Canada which we acquired on September 7, 2022, and which we expect will start producing silver in the third quarter of 2023. Based upon our operational footprint, we believe we have low political and economic risk compared to other mines located in other parts of the world.
Biggest changeBased upon the jurisdictions in which we operate, we believe we have lower political and economic risk compared to other mining companies whose mines are located in other parts of the world. Our current exploration interests are located in the United States, Canada and Mexico.
We are involved in various environmental legal matters and the estimate of our environmental liabilities and liquidity needs, as well as our strategic plans, may be significantly impacted as a result of these matters or new matters that may arise.
We are involved in various environmental legal matters and the estimate of our environmental liabilities and liquidity needs, as well as our strategic plans, may be 62 significantly impacted as a result of these matters or new matters that may arise.
Another challenge for us is the risk associated with environmental litigation and ongoing reclamation activities. As described in Item 1A. Risk Factors and in Note 14 of Notes to Consolidated Financial Statements, it is possible that our estimate of these liabilities (and our ability to estimate liabilities in general) may change in the future, affecting our strategic plans.
Another challenge for us is the risk associated with environmental litigation and ongoing reclamation activities. As described in Item 1A. Risk Factors and in Note 16 of Notes to Consolidated Financial Statements, it is possible that our estimate of these liabilities (and our ability to estimate liabilities in general) may change in the future, affecting our strategic plans.
We utilize forward contracts to manage exposure to declines in the prices of (i) silver, gold, zinc and lead contained in our concentrates that have been shipped but have not yet settled, and (ii) zinc and lead that we forecast for future concentrate shipments.
We utilize forward contracts to manage exposure to declines in the prices of (i) silver, gold, zinc and lead contained in our concentrates that have been shipped but have not yet settled, and (ii) from time to time zinc and lead that we forecast for future concentrate shipments.
See the Consolidated Results of Operations section below for a discussion of the factors impacting income applicable to common stockholders for the three years ended December 31, 2022, 2021 and 2020.
See the Consolidated Results of Operations section below for a discussion of the factors impacting income applicable to common stockholders for the three years ended December 31, 2023, 2022 and 2021.
Key Issues Impacting our Business Our current business strategy is to focus our financial and human resources in the following areas: • executing value enhancing transactions, such as with the recently consummated Alexco acquisition; • advancing the development of the Keno Hill mine with the anticipation of commencement of production before the end of 2023; • rapidly responding to the threats from the COVID-19 pandemic to protect our workforce, operations and communities while maintaining liquidity; • operating our properties safely, in an environmentally responsible and cost-effective manner; • maintaining and investing in exploration and pre-development projects in the vicinities of mining districts and projects we believe to be under-explored and under-invested: Greens Creek on Alaska's Admiralty Island located near Juneau; North Idaho's Silver Valley in the historic Coeur d'Alene Mining District; the silver-producing district near Durango, Mexico; in the vicinity of our Casa Berardi mine and the Heva-Hosco project in the Abitibi region of northwestern Quebec, Canada; our projects located in two districts in Nevada; our projects in the Keno Hill mining district in the Yukon Territory, Canada; northwestern Montana; the Creede district of southwestern Colorado; the Kinskuch project in British Columbia, Canada; and the Republic Mining District in Washington state; • improving operations at each of our mines, which includes incurring costs for new technologies and equipment; • expanding our proven and probable reserves, mineral resources and production capacity at our properties; • conducting our business with financial stewardship to preserve our financial position in varying metals price and operational environments; • advancing permitting of our Montana assets; and • seeking opportunities to acquire and invest in mining and exploration properties and companies.
Key Issues Impacting our Business Our current business strategy is to focus our financial and human resources in the following areas: • executing value enhancing transactions, such as with the recently completed ATAC acquisition; • advancing the development and ramp up of the Keno Hill mine with the anticipation of commencement of commercial production before the end of 2024; • operating our properties safely, in an environmentally responsible and cost-effective manner; • maintaining and investing in exploration and pre-development projects in the vicinities of mining districts and projects we believe to be under-explored and under-invested: Greens Creek on Alaska's Admiralty Island located near Juneau; North Idaho's Silver Valley in the historic Coeur d'Alene Mining District; the silver-producing district near Durango, Mexico; in the vicinity of our Casa Berardi mine and the Heva-Hosco project in the Abitibi region of northwestern Quebec, Canada; our projects located in two districts in Nevada; our projects in the Keno Hill mining district in the Yukon Territory, Canada; northwestern Montana; the Creede district of southwestern Colorado; the Kinskuch project in British Columbia, Canada; and the Republic Mining District in Washington state; • improving operations at each of our mines, which includes incurring costs for new technologies and equipment; • expanding our proven and probable reserves, mineral resources and production capacity at our properties; • conducting our business with financial stewardship to preserve our financial position in varying metals price and operational environments; • advancing permitting of the Libby Exploration project in Montana; and • seeking opportunities to acquire and invest in mining and exploration properties and companies.
Our average realized silver, gold, lead and zinc prices increased in 2021 compared to 2020. See the Consolidated Results of Operations section below for information on our average realized metals prices for 2022, 2021 and 2020. Lead and zinc represent important by-products at our Greens Creek and Lucky Friday segments, and gold is also a significant by-product at Greens Creek.
See the Consolidated Results of Operations section below for information on our average realized metals prices for 2023, 2022 and 2021. Lead 61 and zinc represent important by-products at our Greens Creek and Lucky Friday segments, and gold is also a significant by-product at Greens Creek.
Over view Established in 1891, we believe we are the oldest operating precious metals mining company in the United States. We are the largest silver producer in the United States, producing over 40% of the U.S. silver production at our Greens Creek and Lucky Friday operations.
Over view Established in 1891, we are the oldest operating precious metals mining company in the United States. We are the largest silver producer in the United States, producing over 45% of 2022 U.S. silver production at our Greens Creek and Lucky Friday operations. We also produce gold at our Casa Berardi and Greens Creek operations.
Item 6. Res erved Not applicable 54 Item 7.
Item 6. Res erved Not applicable 60 Item 7.
Financial: • Reported sales of $718.9 million. • Generated $89.9 million in net cash provided by operating activities.
Financial: • Reported sales of $720.2 million. • Generated $75.5 million in net cash provided by operating activities.
In addition, we have in place a $150 million revolving credit agreement, with an option to be increased in an aggregate amount not to exceed $75 million. As of December 31, 2022, $7.8 million was used for lines of credit, leaving approximately $142.2 million available for borrowing.
In addition, we have in place a $150 million revolving credit agreement, with an option to be increased in an aggregate amount not to exceed $75 million. As of December 31, 2023, $6.9 million was used for letters of credit, and $128.0 million was drawn on the facility leaving approximately $15.1 million available for borrowing.
While we believe longer-term global economic and industrial trends could result in continued demand for the metals we produce, prices have been volatile and there can be no assurance that current prices will continue. We also experienced significant cost increases compared to 2021 across our operations.
Critical Accounting Estimates and Note 10 of Notes to Consolidated Financial Statements . While we believe longer-term global economic and industrial trends could result in continued demand for the metals we produce, prices have been volatile and there can be no assurance that current prices will continue.
Metals prices can be very volatile and are influenced by a number of factors beyond our control (except on a limited basis through the use of derivative contracts). See Item 7. Critical Accounting Estimates and Note 9 of Notes to Consolidated Financial Statements .
A number of key factors may impact the execution of our strategy, including regulatory issues, metals prices and inflationary pressures on input costs. Metals prices can be very volatile and are influenced by a number of factors beyond our control (except on a limited basis through the use of derivative contracts). See Item 7.
See the Financial Liquidity and Capital Resources section below for further discussion. • Made capital expenditures (excluding lease additions and other non-cash items) of approximately $149.4 million, including $39.7 million at Casa Berardi, $36.9 million at Greens Creek, $51.0 million at Lucky Friday, and $19.7 million at Keno Hill. • Returned $12.9 million to our stockholders through dividend payments. 55 Our average realized gold price increased while our realized price for silver, lead and zinc prices decreased in 2022 compared to 2021.
See the Financial Liquidity and Capital Resources section below for further discussion. • Made capital expenditures (excluding lease additions and other non-cash items) of approximately $223.9 million, including $70.1 million at Casa Berardi, $43.5 million at Greens Creek, $65.3 million at Lucky Friday, and $44.7 million at Keno Hill. • Returned $15.7 million to our stockholders through dividend payments.
Our exploration interests are located in the United States, Canada and Mexico. Our operating and strategic framework is based on expanding our production and locating and developing new resource potential in a safe and responsible manner. Acquisition of Alexco On September 7, 2022, we completed the acquisition of the remaining 90.1% of Alexco Resource Corp.
Our operating and strategic framework is based on expanding our production and locating and developing new resource potential in a safe and responsible manner. Acquisition of ATAC Resources Ltd. On July 7, 2023, we completed the acquisition of ATAC Resources Ltd.
See Consolidated Results of Operations below for information on cost of sales and other direct production costs and depreciation, depletion and amortization and cash costs and AISC, after by-product credits, per silver and gold ounce for 2022, 2021 and 2020. • Increased Lucky Friday silver production by 24% to 4.4 million ounces with the UCB mining method accounting for 88% of the tons mined in 2022 and 86% in 2021. • Continued our trend of strong safety performance, as our All Injury Frequency Rate (“AIFR”) for 2022 was 1.22.
See Consolidated Results of Operations below for information on total cost of sales and cash costs and AISC, after by-product credits, per silver and gold ounce for 2023, 2022 and 2021. • Keno Hill produced 1.5 million ounces of silver, with the Bermingham deposit achieving the highest mined tonnage in December; initiated a safety action plan to build a strong operational foundation at the mine. • Continued our trend of strong safety performance, as our All Injury Frequency Rate (“AIFR”) for 2023 was 1.45.
Removed
We produce gold at our Casa Berardi operation in Quebec, Canada, and Greens Creek, and produced gold at our Nevada Operations segment prior to suspension of operations during 2021. We also produced silver and gold at San Sebastian in Mexico, which was considered an operating segment prior to 2021.
Added
In addition, we are developing the Keno Hill mine in the Yukon Territory, Canada which we acquired in September 2022. We began ramp-up of the Keno Hill mill during the second quarter of 2023, with production commencing in June 2023.
Removed
Production ceased in the fourth quarter of 2020, and exploration activities are currently ongoing. San Sebastian's activity for all periods presented in this Annual Report on Form 10-K is included in "other".
Added
("ATAC"), a Canadian publicly traded company, for total consideration of approximately $19.4 million through the issuance of 3,676,904 shares of Hecla common stock to ATAC shareholders based on the share exchange ratio of 0.0166 Hecla share for each ATAC common share, and $0.6 million of acquisition costs.
Removed
("Alexco") that we did not already own for non-cash consideration of 17,992,875 shares of our common stock valued at $68.7 million.
Added
The acquisition was deemed to be an asset acquisition under GAAP as substantially all of the fair value of the gross assets acquired was concentrated in a single asset group being mineral interests. The total consideration was assigned to the estimated fair values of the assets acquired and liabilities assumed, with $18.1 million assigned to mineral interests.
Removed
Total consideration for the acquisition, deemed to be an asset acquisition under GAAP, was $81.5 million of which $76.4 million was non cash, including the fair value of our common stock issued and the fair value of the 9.9% Alexco investment held by us prior to the completion of the acquisition and previously accounted for as marketable equity securities of $7.7 million.
Added
As part of the acquisition, we also acquired 5,502,956 units consisting of (i) shares of Cascadia Minerals Ltd. (“Cascadia”) representing a 19.9% stake, and (ii) full warrants with a five-year term for a CAD$2 million cash investment in Cascadia. Cascadia will be managed by the former management of ATAC, who will explore specific properties in the Yukon and British Columbia.
Removed
Acquisition costs also included transaction costs of $5.1 million.
Added
We have the right to appoint two directors to Cascadia’s board. 2023 Highlights Operational: • Produced 14.3 million ounces of silver and 151,259 ounces of gold.
Removed
The total consideration was allocated to the acquired assets and assumed liabilities based on their estimated fair values on the acquisition date, which primarily consisted of mineral interests of $236.6 million, a related deferred tax liability of $12.9 million, net liabilities of $7.2 million and a silver stream liability of $135 million.
Added
Our average realized prices for silver, gold and lead increased in 2023 compared to 2022 while zinc decreased. Our average realized gold price increased while our realized price for silver, lead and zinc prices decreased in 2022 compared to 2021.
Removed
Immediately following the closure of the acquisition, we settled the silver stream liability with the stream holder for 34,800,990 shares of our common stock. Prior to September 7, 2022, we advanced $25 million to Alexco to fund its operations on market terms.
Removed
The advance was assumed upon acquisition and is eliminated upon consolidation. 2022 Highlights Operational: • Produced 14.2 million ounces of silver and 175,807 ounces of gold.
Removed
Since its outbreak in 2020, the COVID-19 pandemic impacted our operational practices and we continue to incur incremental costs and modify our operational plans to keep our workforce safe. In 2020, the pandemic adversely impacted our expected production of gold at Casa Berardi and exploration drilling at Greens Creek.
Removed
We incurred $0.5 million, $4.3 million and $5.8 million in COVID-19 mitigation costs during 2022, 2021 and 2020, respectively. To mitigate the impact of COVID-19, we have taken precautionary measures, including implementing operational plans and practices and increasing our cash reserves.
Removed
As long as they are required, the operational practices implemented could continue to have an adverse impact on our operating results due to additional costs or deferred production and revenues. There is uncertainty related to the potential additional impacts COVID-19 and any variants could have on our operations and financial results for 2023 and beyond. See Item IA.
Removed
Risk Factors - Natural disasters, public health crises (including COVID-19), political crises, and other catastrophic events or other events outside of our control may materially and adversely affect our business or financial results and The COVID-19 virus pandemic may heighten other risks . 56 A number of key factors may impact the execution of our strategy, including regulatory issues, metals prices and inflationary pressures on input costs.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

31 edited+23 added−43 removed14 unchanged
Biggest changeYears Ended December 31, 2022 2021 2020 Measured Resources (1,2,3) Total tons — — 296,500 Silver (ounces per ton) — — 12.9 Gold (ounces per ton) — — 0.11 Zinc (percent) — — 10.3 Lead (percent) — — 3.1 Silver (ounces) — — 3,836,800 Gold (ounces) — — 33,000 Zinc (tons) — — 30,500 Lead (tons) — — 9,310 Indicated Resources (1,2,3) Total tons 8,421,200 8,355,000 8,598,500 Silver (ounces per ton) 12.9 12.8 12.9 Gold (ounces per ton) 0.10 0.10 0.10 Zinc (percent) 8.0 8.4 8.2 Lead (percent) 2.9 3.0 3.0 Silver (ounces) 108,717,200 106,670,300 110,843,800 Gold (ounces) 810,300 835,900 848,200 Zinc (tons) 675,740 701,520 708,520 Lead (tons) 245,990 250,040 256,790 Measured and Indicated Resources (1,2,3) Total tons 8,421,200 8,355,000 8,895,000 Silver (ounces per ton) 12.9 12.8 12.9 Gold (ounces per ton) 0.10 0.10 0.10 Zinc (percent) 8.0 8.4 8.3 Lead (percent) 2.9 3.0 3.0 Silver (ounces) 108,717,200 106,670,300 114,680,600 Gold (ounces) 810,300 835,900 881,200 Zinc (tons) 675,740 701,520 739,020 Lead (tons) 245,990 250,040 266,100 Inferred Resources (1,2,3) Total tons 2,383,200 2,151,700 1,766,700 Silver (ounces per ton) 12.2 12.8 13.2 Gold (ounces per ton) 0.08 0.08 0.08 Zinc (percent) 6.9 6.8 7.0 Lead (percent) 2.8 2.8 2.8 Silver (ounces) 28,949,200 27,507,500 23,370,400 Gold (ounces) 178,100 163,700 145,400 Zinc (tons) 164,080 146,020 123,480 Lead (tons) 67,400 60,140 49,670 (1) Mineral resources are based on $1,700/oz for gold, $21.00/oz for silver, $1.15/lb for lead, $1.35/lb for zinc and are reported in-situ and exclusive of mineral reserves.
Biggest changeYears Ended December 31, 2023 2022 Measured Resources (1,2,3) Total tons — — Silver (ounces per ton) — — Gold (ounces per ton) Lead (percent) — — Zinc (percent) — — Silver (ounces) — — Gold (ounces) Lead (tons) — — Zinc (tons) — — Indicated Resources (1,2,3) Total tons 4,504,200 4,061,200 Silver (ounces per ton) 7.5 8.0 Gold (ounces per ton) 0.01 0.01 Lead (percent) 0.9 1.0 Zinc (percent) 3.5 4.0 Silver (ounces) 33,926,400 32,287,500 Gold (ounces) 26,200 28,500 Lead (tons) 41,120 39,540 Zinc (tons) 157,350 163,130 Measured and Indicated Resources (1,2,3) Total tons 4,504,200 4,061,200 Silver (ounces per ton) 7.5 8.0 Gold (ounces per ton) 0.01 0.01 Lead (percent) 0.9 1.0 Zinc (percent) 3.5 4.0 Silver (ounces) 33,926,400 32,287,500 Gold (ounces) 26,200 28,500 Lead (tons) 41,120 39,540 Zinc (tons) 157,350 163,130 Inferred Resources (1,2,3) Total tons 2,835,900 2,440,600 Silver (ounces per ton) 11.2 10.4 Gold (ounces per ton) 0.003 0.003 Lead (percent) 1.1 0.9 Zinc (percent) 1.8 2.1 Silver (ounces) 31,790,500 25,477,800 Gold (ounces) 8,600 7,900 Lead (tons) 32,040 22,380 Zinc (tons) 51,870 51,000 (1) Mineral resources are based on $21.00/oz for silver, $1.15/lb for lead, $1.35/lb for zinc and are reported in-situ and exclusive of mineral reserves. 54 (2) The resource NSR cut-off values for Keno Hill are $129.10/ton ; metallurgical recoveries (actual 2023): 95% for silver, 95% for lead and 88% for zinc.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, under Reconciliation of Cost of Sales and Other Direct Production Costs and Depreciation, Depletion and Amortization (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP).
Management’s Discussion and Analysis of Financial Condition and Results of Operations, under Reconciliation of Cost of Sales and Other Direct Production Costs and Depreciation, Depletion and Amortization (GAAP) to Cash Cost, Before 56 By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP).
Coarse and fine ‘blank,’ sterile, sample materials are used to monitor contamination at the sample preparation and analytical stages; Standard Reference Materials (“SRM”) of known grades are used to measure accuracy of the analytical results; and pulp duplicate samples and coarse reject duplicate samples are used to monitor precision of the analytical results.
Coarse and fine ‘blank,’ sterile, sample materials are used to monitor contamination at the sample preparation 57 and analytical stages; Standard Reference Materials (“SRM”) of known grades are used to measure accuracy of the analytical results; and pulp duplicate samples and coarse reject duplicate samples are used to monitor precision of the analytical results.
All are eligible members or licensees in good standing of a recognized professional organization based on their academic qualifications and experience and comply with professional standards of competence and ethics. Hecla encourages continuing professional development and training for current Qualified Persons as well as others in the company to develop other Qualified Persons within the various departments.
All are eligible members or licensees in good standing of a recognized professional organization based on their academic qualifications and experience and comply with professional standards of competence and ethics. We encourage continuing professional development and training for current Qualified Persons as well as others in the Company to develop other Qualified Persons within the various departments.
Our estimates of proven and probable reserves are based on the following metals prices: December 31, 2022 2021 2020 Silver (per ounce) $ 17.00 $ 17.00 $ 16.00 Lead (per pound) $ 0.90 $ 0.90 $ 0.90 Zinc (per pound) $ 1.15 $ 1.15 $ 1.15 (3) Reserves are in-situ materials that incorporate estimates of the amount of waste that must be mined along with the ore and expected mining recovery.
Our estimates of proven and probable reserves are based on the following metals prices: December 31, 2023 Silver (per ounce) $ 17.00 Lead (per pound) $ 0.90 Zinc (per pound) $ 1.15 (2) Reserves are in-situ materials that incorporate estimates of the amount of waste that must be mined along with the ore and expected mining recovery.
The average cutoff grade at Casa Berardi is 0.12 ounces per ton for underground reserves and 0.04 ounces per ton for open pit reserves.
The average cutoff grade at Casa Berardi is 0.11 ounces per ton for underground reserves and 0.03 ounces per ton for open pit reserves.
The map below illustrates the location and access to Casa Berardi: Current reserves at the Casa Berardi mine comprise eight zones at the West Mine, spread over a moderate horizontal distance from each other and located at different mine elevations, plus open pit and underground areas at the East Mine.
The map below illustrates the location and access to Casa Berardi: Current reserves at the Casa Berardi mine comprise eight zones at the West Mine, spread over a moderate horizontal distance from each other and located at different mine elevations, plus open pit and underground areas at the East Mine. 55 The ore at Casa Berardi is extracted using a combination of underground and open pit mining methods.
Years Ended December 31, 2022 2021 2020 Measured Resources (1,2,3) Total tons 2,922,400 2,368,100 3,055,300 Gold (ounces per ton) 0.19 0.15 0.13 Gold (ounces) 549,700 355,200 401,600 Indicated Resources (1,2,3) Total tons 5,193,300 5,396,000 7,045,500 Gold (ounces per ton) 0.14 0.13 0.12 Gold (ounces) 707,800 699,200 846,900 Measured and Indicated Resources (1,2,3) Total tons 8,115,700 7,764,100 10,100,800 Gold (ounces per ton) 0.16 0.14 0.12 Gold (ounces) 1,257,500 1,054,400 1,248,500 Inferred Resources (1,2,3) Total tons 10,049,200 10,125,700 11,676,100 Gold (ounces per ton) 0.08 0.08 0.08 Gold (ounces) 819,800 790,500 952,600 (1) Mineral resources are based on $1,700/oz for gold and a USD/CAD exchange rate: 1:1.3 and are reported in-situ and exclusive of mineral reserves.
Years Ended December 31, 2023 2022 2021 Measured Resources (1,2,3) Total tons 1,166,300 2,922,400 2,368,100 Gold (ounces per ton) 0.20 0.19 0.15 Gold (ounces) 235,900 549,700 355,200 Indicated Resources (1,2,3) Total tons 3,359,400 5,193,300 5,396,000 Gold (ounces per ton) 0.18 0.14 0.13 Gold (ounces) 607,400 707,800 699,200 Measured and Indicated Resources (1,2,3) Total tons 4,525,700 8,115,700 7,764,100 Gold (ounces per ton) 0.19 0.16 0.14 Gold (ounces) 843,300 1,257,500 1,054,400 Inferred Resources (1,2,3) Total tons 1,475,100 10,049,200 10,125,700 Gold (ounces per ton) 0.22 0.08 0.08 Gold (ounces) 331,600 819,800 790,500 (1) Mineral resources are based on $1,750/oz for gold and a USD/CAD exchange rate: 1:1.3 and are reported in-situ and exclusive of mineral reserves.
Inferred gold resources increased 4% over 2021 due to drill additions. Internal Controls Exploration and development drilling programs are performed using Industry Standard quality control methods for drilling, sampling, and analytical procedures. Standard operating procedure manuals for geology logging, sampling, and assaying are kept at the operations and updated as required.
Internal Controls on Exploration and Development Drilling Programs Exploration and development drilling programs are performed using Industry Standard quality control methods for drilling, sampling, and analytical procedures. Standard operating procedure manuals for geology logging, sampling, and assaying are kept at the operations and updated as required.
Year Ended December 31, Production 2022 2021 2020 Ore milled (tons) 1,588,739 1,528,246 1,283,701 Gold (ounces) 127,590 134,511 121,492 Silver (ounces) 28,289 33,571 24,142 Total cost of sales $ 248,898 $ 229,829 $ 194,414 Cash Cost, After By-product Credits, Per Gold Ounce (1) $ 1,478 $ 1,125 $ 1,131 AISC, After By-product Credits, Per Gold Ounce (1) $ 1,825 $ 1,399 $ 1,436 Proven Mineral Reserves (2,3,4) Total tons 4,961,400 5,685,600 5,474,900 Gold (ounces per ton) 0.10 0.11 0.10 Contained gold (ounces) 512,300 596,300 567,400 Probable Mineral Reserves (2,3,4) Total tons 13,422,600 15,065,800 11,295,600 Gold (ounces per ton) 0.08 0.08 0.09 Contained gold (ounces) 1,101,600 1,187,700 974,600 Total Proven and Probable Mineral Reserves (2,3,4) Total tons 18,384,000 20,751,400 16,770,500 Gold (ounces per ton) 0.09 0.09 0.09 Contained gold (ounces) 1,613,900 1,784,000 1,542,000 (1) Includes by-product credits from silver production.
Year Ended December 31, Production 2023 2022 2021 Ore milled (tons) 1,446,488 1,588,739 1,528,246 Gold (ounces) 90,363 127,590 134,511 Silver (ounces) 22,415 28,289 33,571 Total cost of sales $ 221,341 $ 248,898 $ 229,829 Cash Cost, After By-product Credits, Per Gold Ounce (1) $ 1,652 $ 1,478 $ 1,125 AISC, After By-product Credits, Per Gold Ounce (1) $ 2,048 $ 1,825 $ 1,399 Proven Mineral Reserves (2,3,4) Total tons 4,294,900 4,961,400 5,685,600 Gold (ounces per ton) 0.09 0.10 0.11 Contained gold (ounces) 386,100 512,300 596,300 Probable Mineral Reserves (2,3,4) Total tons 11,559,400 13,422,600 15,065,800 Gold (ounces per ton) 0.08 0.08 0.08 Contained gold (ounces) 884,400 1,101,600 1,187,700 Total Proven and Probable Mineral Reserves (2,3,4) Total tons 15,854,300 18,384,000 20,751,400 Gold (ounces per ton) 0.08 0.09 0.09 Contained gold (ounces) 1,270,500 1,613,900 1,784,000 (1) Includes by-product credits from silver production.
Casa Berardi Since June 2013, we have owned and operated 100% of Casa Berardi, located 95 kilometers north of La Sarre in the Abitibi Region of northwestern Quebec, Canada at 49°34'0.72”N Latitude, 79°15'56.05”W Longitude (WGS84). The property borders Ontario to the west and covers parts of Casa Berardi, Dieppe, Raymond, D'Estrees, and Puiseaux townships.
Casa Berardi is located 95 kilometers north of La Sarre in the Abitibi Region of northwestern Quebec, Canada at 49°34'0.72”N Latitude, 79°15'56.05”W Longitude (WGS84). The property borders Ontario to the west and covers parts of Casa Berardi, Dieppe, Raymond, D'Estrees, and Puiseaux townships. We report Casa Berardi as a separate segment in our consolidated financial statements.
The 2022 reserve model assumes average total mill recoveries of 95% for silver, 95% for lead and 90% for zinc.
The 2023 reserve model assumes average total mill recoveries of 96% for silver, 93% for lead and 72% for zinc.
The change in 2021 compared to 2020 resulted from inclusion of definition drilling information, partially offset by depletion of the deposit through production. Information on in-situ mineral resources for the past three years is set forth in the following table.
The change in reserves in 2022 compared to 2021 resulted from inclusion of definition drilling information, partially offset by depletion of the deposit through production and an increase of the cut-off grade given increased operating costs. Information on in-situ mineral resources excluding minerals reserves for Casa Berardi for the past three years is set forth in the following table.
The cut-off grade calculations include costs associated with mining, processing, surface operations, environmental, general administrative, and sustaining capital.
The reserve NSR cut-off values for Keno Hill are $244.24/ton The cut-off grade calculations include costs associated with mining, processing, surface 52 operations, environmental, general administrative, and sustaining capital.
The net book value of the Lucky Friday property and its associated plant, equipment and mineral interests was approximately $521.5 million as of December 31, 2022. The vintage of the facilities at Lucky Friday ranges from the 1950s to 2022. The current mine plan at Lucky Friday utilizes estimates of reserves and resources for approximately 16 years of production.
The current mine plan at Casa Berardi utilizes estimates of reserves and resources for approximately 14 years of production to 2037, and includes anticipated production from both the underground and open pit mine areas. The net book value of the Casa Berardi property and its associated plant, equipment and mineral interests was approximately $624.5 million as of December 31, 2023.
The employees at Casa Berardi are employees of Hecla Quebec Inc., our wholly-owned subsidiary, and are not represented by a bargaining agent. There were 675 e mployees at Casa Berardi at December 31, 2022. We also utilize third-party contractors, which use their employees and equipment, for some of the mining activities at Casa Berardi.
There were 497 e mployees at Casa Berardi at December 31, 2023. We also utilize third-party contractors, which use their employees and equipment, for some of the mining activities at Casa Berardi.
The change in reserve in 2021 from 2020 was due to inclusion of definition drilling information, partially offset by depletion of the deposit through production. 46 Information on in-situ mineral resources for the past three years is set forth in the following table.
(3) The change in change in silver reserves in 2023 from 2022 was due to inclusion of definition drilling information and additional reserve optimization and resource conversion based on a new geological/mineral zone interpretation, partially offset by depletion of the deposit through production. 53 Information on in-situ mineral resources excluding mineral reserves for Keno Hill for the past two years is set forth in the following table.
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations - Casa Berardi for information on its financial performance. 47 The mine and mill complex are permitted to process 1,600,000 dry metric tonnes (approximately 1,764,000 tons) of ore per year (4,900 tons per day). The mining operations consist of underground and open pit mines.
Arsenopyrite is the main gold-bearing sulfide present in all veins of the deposit The mine and mill complex are permitted to process 1,600,000 dry metric tonnes (approximately 1,764,000 tons) of ore per year (4,900 tons per day). The mining operations consist of underground and open pit mines.
The ore at Casa Berardi is extracted using a combination of underground and open pit mining methods. The mill utilizes a combination of gravity recovery for coarse gold and cyanidation for fine gold. The ore is crushed and ground to produce a slurry suitable for the subsequent recovery processes.
The mill utilizes a combination of gravity recovery for coarse gold and cyanidation for fine gold. The ore is crushed and ground to produce a slurry suitable for the subsequent recovery processes. Crushing and grinding is accomplished by a jaw crusher followed by a SAG mill and ball mill.
Due to the presence of naturally occurring organic carbon in the ore, the Carbon-In-Leach (“CIL”) approach is used in a cyanidation circuit. Gold is adsorbed onto carbon in the leach train and later desorbed for electrowinning. Sludge from the electrowinning cells is melted in a furnace to produce doré, the final product produced at Casa Berardi.
Gold is adsorbed onto carbon in the leach train and later desorbed for electrowinning. Sludge from the electrowinning cells is melted in a furnace to produce doré, the final product produced at Casa Berardi. In 2023, the mill processed 1,446,488 tons, for an average of 3,963 tons per day.
The net book value of the Casa Berardi property and its associated plant, equipment and mineral interests was approximately $619.9 million as of December 31, 2022. As of December 31, 2022, we have recorded a $11.4 million asset retirement obligation for reclamation and closure costs. We maintain a surety bond as financial guarantee for future reclamation and closure work.
At December 31, 2023, there were 255 employees at Keno Hill. 51 As of December 31, 2023, we have recorded a $3.4 million asset retirement obligation for reclamation and closure costs. The net book value of the Keno Hill property and its associated plant, equipment and mineral interests was approximately $335.7 million as of December 31, 2023.
Crushing and grinding is accomplished by a jaw crusher followed by a SAG mill and ball mill. Coarse gold reports to the gravity circuit consisting of Knelson concentrators followed by high intensity leaching and electrowinning. Fine gold reports to the cyanide leach train.
Coarse gold reports to the gravity circuit consisting of Knelson concentrators followed by high intensity leaching and electrowinning. Fine gold reports to the cyanide leach train. Due to the presence of naturally occurring organic carbon in the ore, the Carbon-In-Leach (“CIL”) approach is used in a cyanidation circuit.
Resource grade models are validated using Industry Standard methods and appropriate documentation and reporting are completed to summarize methods and results.
Geology and mineral control interpretations, grade estimation parameters, grade and density models, reserve estimation parameters, and modifying factors are peer reviewed within the company. Resource grade models are validated using Industry Standard methods and appropriate documentation and reporting are completed to summarize methods and results.
Accurate data entry into the database is confirmed by verification upon data entry/import and again before use in final geology interpretation and resource modeling with checks of new data collected during yearly drilling programs. 50 Geology and mineral control interpretations, grade estimation parameters, grade and density models, reserve estimation parameters, and modifying factors are peer reviewed within the company.
The main operating properties store data in SQL-based relational database utilities with built-in logic checks that are implemented as new data is imported. Accurate data entry into the database is confirmed by verification upon data entry/import and again before use in final geology interpretation and resource modeling with checks of new data collected during yearly drilling programs.
Information with respect to the Lucky Friday’s production, total cost of sales, average Cash Cost, After By-product Credits, Per Silver Ounce, AISC, After By-product Credits, Per Silver Ounce, and proven and probable in -situ mineral reserves for the past three years is set forth in the table below.
Information with respect to the Keno Hill’s production and proven and probable in -situ mineral reserves for the past two years is set forth in the table below.
Our estimates of proven and probable reserves are based on the prices of $1,600 per gold ounce for 2022 and 2021 and $1,300 per gold ounce for 2020. 49 (3) Reserves are in-situ materials that incorporate estimates of the amount of waste that must be mined along with the ore and expected mining recovery.
(3) Reserves are in-situ materials that incorporate estimates of the amount of waste that must be mined along with the ore and expected mining recovery. The 2023 reserve model assumes average total mill recoveries for gold of approximately 85% for reserves.
In 2022, the mill processed 1,588,739 tons, for an average of 4,353 tons per day. For more information, see Exhibit 96.3, the Technical Report Summary on the Casa Berardi Mine, Northwestern Québec, Canada, prepared for the Company by the QP, SLR with an effective date of December 31, 2021.
For more information, see Exhibit 96.3, the Technical Report Summary on the Casa Berardi Mine, Northwestern Québec, Canada, prepared for the Company by the QP, RESPEC with an effective date of December 31, 2023. The employees at Casa Berardi are employees of Hecla Quebec Inc., our wholly-owned subsidiary, and are not represented by a bargaining agent.
Due to multiple ore metals, and complex combinations of ore types, metal ratios and metallurgical performances at Lucky Friday, the cutoff grade is expressed in terms of NSR, rather than metal grade. The reserve NSR cut-off values for Lucky Friday are $241.34/ton for the 30 Vein and $268.67/ton for the Intermediate Veins.
Cutoff grade assumptions vary by ore body and are developed based on reserve metals price assumptions, anticipated mill recoveries and smelter payables, and cash operating costs. Due to multiple ore metals, and complex combinations of ore types, metal ratios and metallurgical performances at Keno Hill, the cutoff grade is expressed in terms of NSR, rather than metal grade.
(2) The average resource cut-off grades at Casa Berardi are 0.11 oz/ton gold for underground and 0.034 oz/ton for open pit; metallurgical recovery (actual 2022): 87% for gold. (3) Measured and indicated mineral gold resources are essentially the same as 2021, with a 1% increase in contained ounces, due to drilling and some conversion from reserve given increased cut-off grades.
(2) The average resource cut-off grades at Casa Berardi are 0.12 oz/ton gold for underground and 0.03 oz/ton for open pit; metallurgical recovery (actual 2023): 85% for gold.
We report Casa Berardi as a separate segment in our consolidated financial statements. See Note 3 of Notes to Consolidated Financial Statements and Item 7.
See Note 4 of Notes to Consolidated Financial Statements and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations - Casa Berardi for information on its financial performance.
For more information, see Exhibit 96.2, the Technical Report Summary on the Lucky Friday Mine, Idaho, U.S.A., prepared for the Company by the QP, SLR, with an effective date of December 31, 2021. At December 31, 2022, there were 383 employees at Lucky Friday.
Overall, silver represents 70% to 80% of the value of the ores in the District. For more information, see Exhibit 96.4, the Technical Report Summary on the Keno Hill Operations, Yukon, Canada, prepared for the Company by Mining Plus Canada Ltd. with an effective date of December 31, 2023.
Removed
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations, under Reconciliation of Total Costs of Sales (GAAP) to Cash Cost, Before By-product Credits and Cash Cost, After By-product Credits (non-GAAP) and All-In Sustaining Cost, Before By-product Credits and All-In Sustaining Cost, After By-product Credits (non-GAAP).
Added
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations - Keno Hill for information on its financial performance. 50 The total Hecla Keno Hill mineral claims as of December 31, 2023, covers an area of 238.12 km2 and comprises 717 quartz mining leases, 867 quartz mining claims and two Crown Grants.
Removed
(2) Proven and probable mineral reserves are calculated and reviewed in-house and are subject to periodic audit by others, although audits are not performed on an annual basis. Cutoff grade assumptions vary by ore body and are developed based on reserve metals price assumptions, anticipated mill recoveries and smelter payables, and cash operating costs.
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Below is a map illustrating the location and access to Keno Hill: The Keno Hill property is a polymetallic silver-lead-zinc vein district with characteristics similar to other well-known mining districts in the world. Examples of this type of mineralization include the Kokanee Range (Slocan), British Columbia; Coeur d’Alene, Idaho; Freiberg and the Harz Mountains, Germany; and Príbram, Czech Republic.
Removed
Due to multiple ore metals, and complex combinations of ore types, metal ratios and metallurgical performances at Greens Creek, the cutoff grade is expressed in terms of NSR, rather than metal grade. The cut-off grade at Greens Creek is $210 per ton NSR for all zones except Gallagher, which has a cutoff grade of $215 per ton NSR.
Added
The local geology is dominated by the Mississippian Keno Hill Quartzite comprising the Basal Quartzite Member and conformably overlying Sourdough Hill Member. Silver predominantly occurs in argentiferous galena and argentiferous tetrahedrite (freibergite). In some assemblages, silver is also found as native silver, in polybasite, stephanite, and pyrargyrite. Lead occurs in galena and zinc in sphalerite.
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The 41 cut-off grade calculations include costs associated with mining, processing, surface operations, environmental, general administrative, sustaining capital, and royalty charges, if any.
Added
Other sulfides include pyrite, pyrrhotite, arsenopyrite, and chalcopyrite. In general, common gangue minerals include siderite and, to a lesser extent, quartz, and calcite. Keno Hill ore is mined with a mechanized cut and fill method ("MCF"). Where the ore width is wider than can be safely extracted in one cut, the ore will be mined in adjacent drifts.
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Our estimates of proven and probable reserves are based on the following metals prices: December 31, 2022 2021 2020 Silver (per ounce) $ 17.00 $ 17.00 $ 16.00 Gold (per ounce) $ 1,600 $ 1,600 $ 1,300 Lead (per pound) $ 0.90 $ 0.90 $ 0.90 Zinc (per pound) $ 1.15 $ 1.15 $ 1.15 (3) Reserves are in-situ materials that incorporate estimates of the amount of waste that must be mined along with the ore and expected mining recovery.
Added
Lenses are predominantly mined in a bottom-up sequence and filled with cemented rock fill ("CRF") with a 3%-8% binder content. CRF is used to introduce temporary sill levels or to fill initial drifts when multiple adjacent drifts are required.
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The 2022 reserve model assumes average total mill recoveries of 81% for silver, 72% for gold, 90% for zinc and 82% for lead.
Added
Temporary sill levels form a sequence interrupting pillar which allows for multiple mining fronts to be active on one lens at a time. The remainder of the lifts will be backfilled with unconsolidated rock fill ("URF"). This mining method was chosen due to the narrow steeply dipping nature of the mineral bodies and to maximize safety and productivity.
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(4) The change in reserves in 2022 versus 2021 was due to due to data from new drill holes, partially offset by continued depletion of the deposit through production and reclassification of some material to indicated resource given proximity to previously mined areas; these reclassified areas will be evaluated during 2023.
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The various deposits require the use of mining methods that can adequately support the vein and that are flexible and selective while minimizing the direct mining costs. In the MCF method, an attack ramp is developed from the main ramp at a gradient of -15%.
Removed
The change in reserves in 2021 versus 2020 was due to due to data from new drill holes and changes in NSR coefficient changes and smelter terms, partially offset by continued depletion of the deposit through production. (5) Probable reserves at Greens Creek are based on average drill spacing of 50 to 100 feet.
Added
Upon reaching the orebody, an intersection is developed, and a lift is developed in both directions along strike, following the geological contact of the orebody. At the end of the lens, the void is backfilled using a Load Haul Dump ("LHD") machine. The LHD utilizes a bulldozer-like plate to push waste tight to the back of the drift.
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Proven reserves typically require that mining samples for the basis of the ore grade estimates used, while probable reserve grade estimates can be based entirely on drilling results. The proven reserves reported for Greens Creek for 2022 represent stockpiled ore. 42 Information on in-situ mineral resources for the past three years is set forth in the following table.
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Once the level has been completely backfilled, the next lift above the previously mined lift is accessed by slashing down the back of the attack ramp and working off the muck pile/horizon. MCF drift sizes are on average 3.5 meters high x 3.5 meters wide.
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(2) The resource NSR cut-off grades for Greens Creek are $210/ton for all zones except the Gallagher Zone at $215/ton; metallurgical recoveries (actual 2022): 81% for silver, 72% for gold, 82% for lead and 89% for zinc.
Added
For areas wider than development equipment, a second parallel drift will be mined beside the backfilled drift to fully extract the material prior to accessing the lift above. In this situation, the first drift will be completely backfilled with cemented rock fill to ensure a stable wall to allow adjacent mining activity.
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(3) Measured resources were not defined for year-end 2022; indicated resources for silver increased 3% from 2021 given additions from drilling and reclassification of some previously defined reserve material; inferred resources for silver increased 5% from 2021 given additions from drilling. 43 Lucky Friday Since 1958 (wholly owned since 1964), we have owned and operated the Lucky Friday mine, a deep underground silver, lead and zinc mine located in the Coeur d’Alene Mining District in northern Idaho at 47°28'15.70”N Latitude, 115°47'0.44”W Longitude (WGS84).
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The lifts are generally sequenced from the bottom-up within each panel. The Keno Hill mill is based on a conventional sequential flotation process producing silver and zinc concentrates. The silver concentrates are high in lead which typically accounts for approximately 90% to 95% of the mill feed silver values since given that is strongly associated with lead minerals.
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Lucky Friday is one-quarter mile east of Mullan, Idaho, and is adjacent to U.S. Interstate 90. We report Lucky Friday as a separate segment in our consolidated financial statements. See Note 3 of Notes to Consolidated Financial Statements and Item 7.
Added
The active infrastructure in place at Keno Hill ranges from the 1980s to 2023. The current mine plan at Keno Hill utilizes estimates of reserves and resources for approximately 11 years of production, through 2034.
Removed
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations - Lucky Friday for information on its financial performance. The Lucky Friday mine is comprised of 710 acres consisting of 43 patented mining claims and fee lands and 535 acres consisting of 53 unpatented mining claims.
Added
Information with respect to Keno Hill’s average Cash Cost, After By-product Credits, Per Silver Ounce, AISC, After By-product Credits, Per Silver Ounce were not reported as the mine has not reached commercial production.
Removed
We also own or control approximately 26 square miles of mineral interests, which include patented mining and millsite claims, fee lands, and unpatented mining claims, that are adjacent to the Lucky Friday mine property. Below is a map illustrating the location and access to Lucky Friday: Access to the mining horizons from the surface is by shaft access.
Added
At the time the mine reaches commercial production, these metrics will be reported, as until this time costs are allocated to total cost of sales to the extent there are sales.
Removed
Once underground, trackless drifts and ramps are utilized to reach the mining areas. An internal, hoisting shaft was completed in 2017 to extend access at depth in the Gold Hunter area. The principal mining methods in use at Lucky Friday consist of underhand systems with integral paste fill and varying degrees of mechanization.
Added
Years Ended December 31, Production 2023 2022 2021 Ore milled (tons) 56,331 — — Silver (ounces) 1,502,577 — — Lead (tons) 1,225 — — Zinc (tons) 1,139 — — Proven Mineral Reserves (2,3,4) Total tons — — — Silver (ounces per ton) — — — Gold (ounces per ton) Lead (percent) — — — Zinc (percent) — — — Contained silver (ounces) — — — Contained gold (ounces) — — — Contained lead (tons) — — — Contained zinc (tons) — — — Probable Mineral Reserves (2,3,4) Total tons 2,069,400 2,196,900 — Silver (ounces per ton) 26.6 22.5 — Gold (ounces per ton) 0.01 0.01 — Lead (percent) 2.8 2.4 — Zinc (percent) 2.5 2.2 — Contained silver (ounces) 55,068,000 49,472,600 — Contained gold (ounces) 13,400 13,000 — Contained lead (tons) 58,170 52,530 — Contained zinc (tons) 52,380 49,310 — Total Proven and Probable Mineral Reserves (2,3,4) Total tons 2,069,400 2,196,900 — Silver (ounces per ton) 26.6 22.5 — Gold (ounces per ton) 0.01 0.01 — Lead (percent) 2.8 2.4 — Zinc (percent) 2.5 2.2 — Contained silver (ounces) 55,068,000 49,472,600 — Contained gold (ounces) 13,400 13,000 — Contained lead (tons) 58,170 52,530 — Contained zinc (tons) 52,380 49,310 — (1) Proven and probable mineral reserves are calculated and reviewed in-house and are subject to periodic audit by others, although audits are not performed on an annual basis.
Removed
In 2021, we tested and implemented the UCB mining method. The UCB method is a new, productive mining method developed by Hecla for proactive control of fault-slip seismicity in deep, high-stress, narrow-vein mining.
Added
The cut-off grade calculations include costs associated with mining and processing. (3) Measured and indicated resources for silver increased 5% and inferred silver resources increased 25% from 2022 given additional definition drilling and updated geology/mineral zone interpretation. C asa Berardi We have wholly owned and operated Casa Berardi since June 2013.
Removed
The method uses bench drilling and blasting methods to fragment significant vertical and lateral extents of the vein beneath a top cut taken along the strike of the vein and under engineered backfill. The method is accomplished without the use of drop raises or lower mucking drives which may result in local stress concentrations and increased exposure to seismic events.
Added
The Casa Berardi Property is in the northern part of the Abitibi Sub province, a subdivision of the Superior Province, the Archean core of the Canadian Shield. The regional geology is characterized by a mixed assemblage of mafic volcanic rocks, flysch-type sedimentary rocks, iron formation, and graphitic mudstone that are limited by a large granodioritic to granitic batholith.
Removed
Large blasts using up to 35,000 lbs. of pumped emulsion and programmable electronic detonators fragment up to 350 feet of strike length to a depth of approximately 30 feet. These large blasts proactively induce fault-slip seismicity at the time of the blast and shortly after it. This blasted corridor is then mined underhand for two cuts.
Added
Structurally, the property is enclosed in the Casa Berardi Tectonic Zone, a 15 km wide corridor that can be traced over 200 km. Mineralized zones are closely associated with the Casa Berardi Fault and are found on both sides of the fault and are currently restricted to a 500 m wide corridor.
Removed
As these cuts are mined, little to no blasting is done to advance them. Dilution is controlled by supporting the hanging wall and footwall as the mining progresses through the blasted ore. The entire cycle repeats and stoping advances downdip, under fill, and in a destressed zone. The method allows for greater control of fault-slip seismic events significantly improving safety.
Added
Gold mineralization is primarily located in quartz veining in the form of veins of 1 m to multi-meter widths, small-scale veins, or veinlet networks/stockworks. Veins contain only minor sulfides (1% to 3%); sulfides include arsenopyrite, pyrite, and traces of sphalerite, chalcopyrite, pyrrhotite, tetrahedrite, galena, and gold.
Removed
In conjunction, a notable productivity increase has been achieved by reducing seismic delays and utilizing bulk mining activities. In 2022 and 2021, 88% and 86%, respectively of the tons mined were produced through the UCB method. The underhand cut and fill method was also utilized in 2022 and 2021.
Added
As of December 31, 2023, we have recorded a $11.2 million asset retirement obligation for reclamation and closure costs. We maintain a surety bond as financial guarantee for future reclamation and closure work.
Removed
Under this method, once a cut is taken along the strike of the vein, it is backfilled with cemented tailings and the next cut is accessed below from the ramp system.
Added
Our estimates of proven and probable reserves are based on the prices of $1,650 per gold ounce for open pit and $1,850 per gold ounce for underground in 2023 and $1,600 per gold ounce for all reserves in 2022 and 2021.
Removed
Both methods utilize rubber-tired equipment to access the veins through ramps developed outside of the ore body. 44 Ore at Lucky Friday is processed using a conventional lead/zinc flotation flowsheet, and the plant capacity currently is estimated at 1,165 tons per day.
Added
(4) The significant change in reserves from 2023 compared to 2022 (-21%) was due to economic operational decisions to close the East Mine underground, economic re-evaluation of the underground reserves in the West Mine, and the initiation of the transition from underground to entirely open pit mine production.
Removed
Ore was processed at an average rate of approximately 978 tons per day, and total mill recovery was approximately 95% for silver, 95% for lead and 88% for zinc during 2022.
Added
(3) Measured and indicated mineral gold resources decreased 33% and inferred gold resources decreased 60% over 2022 given economic operational decisions to backfill open pits in the East Mine with overburden materials and mill tailings and the resultant sterilization of resource materials beneath the open pits.
Removed
The United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial, and Service Workers International Union is the bargaining agent for Lucky Friday’s 277 hourly employees as of December 31, 2022. During early January 2023, the bargaining agent ratified a six year labor agreement that expires in May 2029.
Removed
Following a strike that started in March 2017 and ended in early January 2020, re-staffing of the mine and ramp-up activities were completed during 2020, with a return to full production starting in the fourth quarter of 2020. As of December 31, 2022, we have recorded a $13.3 million asset retirement obligation for reclamation and closure costs.
Removed
Years Ended December 31, Production 2022 2021 2020 Ore milled (tons) 356,907 321,837 179,208 Silver (ounces) 4,412,764 3,564,128 2,031,874 Lead (tons) 29,233 23,137 12,727 Zinc (tons) 12,436 9,969 6,298 Total cost of sales $ 116,598 $ 97,538 $ 56,706 Cash Cost, After By-product Credits, Per Silver Ounce (1) $ 5.06 $ 6.60 $ 9.34 AISC, After By-product Credits, Per Silver Ounce (1) $ 12.86 $ 14.34 $ 18.22 Proven Mineral Reserves (2,3,4) Total tons 4,734,200 4,690,700 4,392,500 Silver (ounces per ton) 13.8 13.9 14.2 Lead (percent) 8.6 8.4 8.8 Zinc (percent) 3.7 3.4 4.1 Contained silver (ounces) 64,637,800 65,313,300 62,290,100 Contained lead (tons) 404,160 395,290 386,210 Contained zinc (tons) 174,510 159,360 180,060 Probable Mineral Reserves (2,3,4) Total tons 840,100 765,400 1,371,900 Silver (ounces per ton) 12.8 12.3 10.7 Lead (percent) 8.1 7.5 7.2 Zinc (percent) 3.2 2.8 3.9 Contained silver (ounces) 9,978,200 9,386,000 14,701,600 Contained lead (tons) 63,510 57,160 99,170 Contained zinc (tons) 25,030 21,650 53,190 Total Proven and Probable Mineral Reserves (2,3,4) Total tons 5,574,300 5,456,100 5,764,400 Silver (ounces per ton) 13.4 13.7 13.4 Lead (percent) 8.4 8.3 8.4 Zinc (percent) 3.6 3.3 4.0 Contained silver (ounces) 74,616,000 74,699,300 76,991,700 Contained lead (tons) 467,670 452,450 485,380 Contained zinc (tons) 199,540 181,010 233,250 (1) Includes by-product credits from lead and zinc production.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

41 edited+13 added−13 removed45 unchanged
Biggest changeInterest Rates We have a $150 million credit facility, and amounts drawn on the facility are subject to variable rates of interest based on a spread over the London Interbank Offered Rate or an alternative base rate. Interest rates fluctuate due to economic factors beyond our control. We had no amount drawn under the facility as of December 31, 2022.
Biggest changeInterest rates fluctuate due to economic factors beyond our control. We had $128 million drawn under the facility as of December 31, 2023. Assuming all revolving loans currently available to us were fully drawn, each one percentage point change in interest rates would result in a $2.2 million change in annual cash interest expense on our credit facility.
Provisional Sales Sales of all metals products sold directly to customers, including by-product metals, are recorded as revenues when performance obligations have been completed and the transaction price can be determined or reasonably estimated. For concentrate sales, revenues are generally recorded at the time of shipment at forward prices for the estimated month of settlement.
Provisional Sales Sales of all metals products sold directly to customers, including by-product metals, are recorded as revenues when all performance obligations have been completed and the transaction price can be determined or reasonably estimated. For concentrate sales, revenues are generally recorded at the time of shipment at forward prices for the estimated month of settlement.
Reserves and resources are a culmination of many estimates and are not guarantees that we will recover the indicated quantities of metals or that we will do so at a profitable level. Business Combinations When acquiring a company, we evaluate whether the transaction should be accounted for as an asset acquisition or a business combination.
Reserves and resources are a culmination of many estimates and are not guarantees that we will recover the indicated quantities of metals or that we will do so at a profitable level. Business Combinations When acquiring a company, we first evaluate whether the transaction should be accounted for as an asset acquisition or a business combination.
Due to the time elapsed between shipment to the customer and the final settlement with the customer we must estimate the prices at which sales of our concentrates will be settled. Previously recorded sales are adjusted to estimated settlement metals prices until final settlement by the customer.
Due to the time elapsed between shipment to the customer and the final settlement with the customer we must estimate the prices at which sales of our metals will be settled. Previously recorded sales are adjusted to estimated settlement metals prices until final settlement by the customer.
Our risk management policy allows for up to 75% of our planned cost exposure for five years into the future to be covered under such programs, and for potential 85 additional programs to manage other foreign currency-related exposure areas.
Our risk management policy allows for up to 75% of our planned cost exposure for five years into the future to be covered under such programs, and for potential additional programs to manage other foreign currency-related exposure areas.
We review the likelihood that we will realize the benefit of our deferred tax 79 assets and therefore the need for valuation allowances on a quarterly basis, or more frequently if events indicate that a review is required.
We review the likelihood that we will realize the benefit of our deferred tax assets and therefore the need for valuation allowances on a quarterly basis, or more frequently if events indicate that a review is required.
Quantitative and Qualitative Disclosures about Market Risk The following discussion about our exposure to market risks and risk-management activities includes forward-looking statements that involve risk and uncertainties, as well as summarizes the financial instruments held by us at December 31, 2022 which are sensitive to changes in commodity prices, foreign exchange rates and interest rates and are not held for trading purposes.
Quantitative and Qualitative Disclosures about Market Risk The following discussion about our exposure to market risks and risk-management activities includes forward-looking statements that involve risk and uncertainties, as well as summarizes the financial instruments held by us at December 31, 2023 which are sensitive to changes in commodity prices, foreign exchange rates and interest rates and are not held for trading purposes.
As discussed in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Estimates , metals prices can fluctuate due to numerous factors beyond our control. As discussed below, we utilize financially-settled forward and put option contracts to manage our exposure to changes in prices for silver, gold, zinc and lead.
Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Estimates , metals prices can fluctuate due to numerous factors beyond our control. As discussed below, we utilize financially-settled forward and put option contracts to manage our exposure to changes in prices for silver, gold, zinc and lead.
Guaran tor Subsidiaries Presented below are Hecla’s condensed consolidating financial statements as required by Rule 3-10 of Regulation S-X of the Securities Exchange Act of 1934, as amended, resulting from the guarantees by certain of Hecla's subsidiaries of the Senior Notes and IQ Notes (see Note 8 of Notes to Consolidated Financial Statements for more information).
Guaran tor Subsidiaries Presented below are Hecla’s condensed consolidating financial statements as required by Rule 3-10 of Regulation S-X of the Securities Exchange Act of 1934, as amended, resulting from the guarantees by certain of Hecla's subsidiaries of the Senior Notes and IQ Notes (see Note 9 of Notes to Consolidated Financial Statements for more information).
These include assumptions for applicable discount rates, the expected rate of return on plan assets and the rate of future employee compensation increases. See Note 5 of Notes to Consolidated Financial Statements for more information on the accounting for our pension plans and the related assumptions.
These include assumptions for applicable discount rates, the expected rate of return on plan assets and the rate of future employee compensation increases. See Note 6 of Notes to Consolidated Financial Statements for more information on the accounting for our pension plans and the related assumptions.
The net loss recognized on the contracts offsets gains related to price adjustments on our provisional concentrate sales, both of which resulted from changes to silver, gold, lead and zinc prices between the time of sale and final settlement.
The net gain recognized on the contracts offsets loss related to price adjustments on our provisional concentrate sales, both of which resulted from changes to silver, gold, lead and zinc prices between the time of sale and final settlement.
As of December 31, 2022, the Guarantors consist of the following Hecla 100%-owned subsidiaries: Hecla Limited; Silver Hunter Mining Company; Rio Grande Silver, Inc.; Hecla MC Subsidiary, LLC; Hecla Silver Valley, Inc.; Burke Trading, Inc.; Hecla Montana, Inc.; Revett Silver Company; RC Resources, Inc.; Troy Mine Inc.; Revett Exploration, Inc.; Revett Holdings, Inc.; Mines Management, Inc.; Newhi, Inc.; Montanore Minerals Corp.; Hecla Alaska LLC; Hecla Greens Creek Mining Company; Hecla Admiralty Company; Hecla Juneau Mining Company; Klondex Holdings Inc.; Klondex Gold & Silver Mining Co.; Klondex Midas Holdings Limited; Klondex Aurora Mine Inc.; Klondex Hollister Mine Inc.; and Hecla Quebec, Inc.
As of December 31, 2023, the Guarantors consist of the following Hecla 100%-owned subsidiaries: Hecla Limited; Silver Hunter Mining Company; Rio Grande Silver, Inc.; Hecla MC Subsidiary, LLC; Hecla Silver Valley, Inc.; Burke Trading, Inc.; Hecla Montana, Inc.; Revett Silver Company; RC Resources, Inc.; Troy Mine Inc.; Revett Exploration, Inc.; Revett Holdings, Inc.; Mines Management, Inc.; Newhi, Inc.; Montanore Minerals Corp.; Hecla Alaska LLC; Hecla Greens Creek Mining Company; Hecla Admiralty Company; Hecla Juneau Mining Company; Klondex Holdings Inc.; Klondex Gold & Silver Mining Co.; Klondex Midas Holdings Limited; Klondex Aurora Mine Inc.; Klondex Hollister Mine Inc.; Hecla Quebec, Inc.; and Alexco Resource Corp.
Actual results could differ materially from those projected in the forward-looking statements. In the normal course of business, we also face risks that are either non-financial or non-quantifiable (see Item 1A. Risk Factors above). Metals Prices 83 Changes in the market prices of silver, gold, lead and zinc can significantly affect our profitability and cash flow.
Actual results could differ materially from those projected in the forward-looking statements. In the normal course of business, we also face risks that are either non-financial or non-quantifiable (see Item 1A. Risk Factors above). Metals Prices Changes in the market prices of silver, gold, lead and zinc can significantly affect our profitability and cash flow. As discussed in Item 7.
If the price for each metal were to change by 10%, the change in the total value of the concentrates sold would be approximately $11.8 million.
If the price for each metal were to change by 10%, the change in the total value of the concentrates sold would be approximately $3.8 million.
As of December 31, 2022 and 2021, we recorded the following balances for the fair value of the contracts (in millions): December 31, Balance sheet line item: 2022 2021 Other current assets $ 1.1 $ 2.7 Other non-current assets 0.4 2.5 Current derivative liabilities 4.0 0.0 Non-current derivative liabilities 3.6 0.0 Net unrealized losses of approximately $7.1 million related to the effective portion of the hedges were included in accumulated other comprehensive income (loss) as of December 31, 2022.
As of December 31, 2023 and 2022, we recorded the following balances for the fair value of the contracts (in millions): December 31, Balance sheet line item: 2023 2022 Other current assets $ 2.7 $ 1.1 Other non-current assets $ 2.0 $ 0.4 Current derivative liabilities $ (1.1 ) $ (4.0 ) Non-current derivative liabilities $ (0.4 ) $ (3.6 ) Net unrealized gains of approximately $1.3 million related to the effective portion of the hedges were included in accumulated other comprehensive income (loss) as of December 31, 2023.
See Note 6 of Notes to Consolidated Financial Statements for additional detail on the valuation allowance.
See Note 7 of Notes to Consolidated Financial Statements for additional detail on the valuation allowance.
See Note 8 of Notes to Consolidated Financial Statements for more information on our credit facility.
See Note 9 of Notes to Consolidated Financial Statements for more information on our credit facility.
Valuation of Deferred Tax Assets Our deferred income tax assets include certain future tax benefits. We record a valuation allowance against any portion of those deferred income tax assets when we believe, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income tax asset will not be realized.
We record a valuation allowance against any portion of those deferred income tax assets when we believe, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income tax asset will not be realized.
Examples of such eliminations include the following: • Investments in subsidiaries . The acquisition of a company results in an investment in debt or equity capital on the records of the parent company and a contribution to debt or equity capital on the records of the subsidiary. Such investments and capital contributions are eliminated in consolidation. • Capital contributions .
Examples of such eliminations include the following: • Investments in subsidiaries . The acquisition of a company results in an investment in debt or equity capital on the records of the parent company and a contribution to debt or equity capital on the records of the subsidiary.
Realized and unrealized gains and losses will be transferred from accumulated other comprehensive loss to current earnings as the underlying forecasted sales transaction is recognized. We estimate approximately $8.4 million in net realized and unrealized gains included in accumulated other comprehensive loss as of December 31, 2022 will be reclassified to current earnings in the next twelve months.
Realized and unrealized gains and losses will be transferred from accumulated other comprehensive loss to current earnings as the underlying forecasted sales transaction is recognized. We estimate approximately $12.6 million in net realized and unrealized gains included in accumulated other comprehensive loss as of December 31, 2023 will be reclassified to current earnings in the next twelve months.
Unrealized gains and losses will be transferred from accumulated other comprehensive loss to current earnings as the underlying operating expenses are recognized. We estimate approximately $3.7 million in net unrealized losses included in accumulated other comprehensive income (loss) as of December 31, 2022 would be reclassified to current earnings in the next twelve months.
Unrealized gains and losses will be transferred from accumulated other comprehensive loss to current earnings as the underlying operating expenses are recognized. We estimate approximately $0.2 million in net unrealized gains included in accumulated other comprehensive income (loss) as of December 31, 2023 would be reclassified to current earnings in the next twelve months.
Our reserves and resources are affected largely by our assessment of future metals prices, as well as by engineering and geological estimates of ore grade, accessibility and production cost. See Item 2. – Properties above for the metals price assumptions used in our estimates of reserves and resources as of December 31, 2022, 2021 and 2020.
Our reserves and resources are affected largely by our assessment of future metals prices, as well as by engineering and geological estimates of ore grade, accessibility, future recoveries, capital expenditures and production costs. See Item 2. – Properties above for the metals price assumptions used in our estimates of reserves and resources as of December 31, 2023, 2022 and 2021.
Certain of Hecla's subsidiaries which generate cash flow routinely provide cash to their parent companies through inter-company transfers. On at least an annual basis, the boards of directors of such subsidiary companies declare dividends to 81 their parent companies, which reduces the subsidiaries' retained earnings and increases the parents' dividend income.
Certain of Hecla's subsidiaries which generate cash flow routinely provide cash to their parent companies through inter-company transfers. On at least an annual basis, the boards of directors of such subsidiary companies declare dividends to their parent companies, which reduces the subsidiaries' retained earnings and increases the parents' dividend income. In consolidation, such activity is eliminated. • Deferred taxes .
Certain of Hecla's subsidiaries do not generate cash flow, either at all or that is sufficient to meet their capital needs, and their cash requirements are routinely met with inter-company advances from their parent companies.
Such investments and capital contributions are eliminated in consolidation. 89 • Capital contributions . Certain of Hecla's subsidiaries do not generate cash flow, either at all or that is sufficient to meet their capital needs, and their cash requirements are routinely met with inter-company advances from their parent companies.
Net realized gains of approximately $0.8 million on contracts related to underlying expenses which have been recognized were transferred from accumulated other comprehensive loss and included in cost of sales and other direct production costs for the year ended December 31, 2022.
Net realized losses of approximately $3.6 million on contracts related to underlying expenses which have been recognized were transferred from accumulated other comprehensive loss and included in cost of sales and other direct production costs for the year ended December 31, 2023.
At December 31, 2022 and 2021, we recorded the following balances for the fair value of forward and put option contracts held at that time (in millions): December 31, 2022 December 31, 2021 Balance sheet line item: Contracts in an asset position Contracts in a liability position Net asset (liability) Contracts in an asset position Contracts in a liability position Net asset (liability) Other current assets $ 1.2 $ — $ 1.2 $ — $ — $ — Other non-current assets 0.1 — 0.1 — — — Current derivatives liability 0 (12.1 ) (12.1 ) 0.7 (20.1 ) (19.4 ) Non-current derivatives liability — (2.5 ) (2.5 ) 0.4 (18.9 ) (18.5 ) Net realized and unrealized gains of approximately $16.8 million related to the effective portion of the contracts designated as hedges were included in accumulated other comprehensive loss as of December 31, 2022.
At December 31, 2023 and 2022, we recorded the following balances for the fair value of forward contracts held at that time (in millions): December 31, 2023 December 31, 2022 Balance sheet line item: Contracts in an asset position Contracts in a liability position Net asset (liability) Contracts in an asset position Contracts in a liability position Net asset (liability) Other current assets $ 3.1 $ — $ 3.1 $ 1.2 $ — $ 1.2 Other non-current assets $ 1.5 $ — $ 1.5 $ 0.1 $ — $ 0.1 Current derivatives liability $ — $ (0.1 ) $ (0.1 ) $ — $ (12.1 ) $ (12.1 ) Non-current derivatives liability $ — $ — $ — $ — $ (2.5 ) $ (2.5 ) Net realized and unrealized gains of approximately $14.6 million related to the effective portion of the contracts designated as hedges were included in accumulated other comprehensive loss as of December 31, 2023.
When those prices increase compared to the contract prices, we incur losses on the contracts. Foreign Currency We operate or have mining interests in Canada and Mexico, which exposes us to risks associated with fluctuations in the exchange rates between the USD and CAD and MXN, respectively.
When those prices increase compared to the contract prices, we incur losses on the contracts. Foreign Currency We operate or have mining interests in Canada, which exposes us to risks associated with fluctuations in the exchange rates between the USD and CAD. We have determined the functional currency for our Canadian operations is the USD.
A 10% change in the exchange rate between the USD and MXN from the rate at December 31, 2022 would have resulted in a change of approximately $0.2 million in our net foreign exchange gain or loss.
A 10% change in the exchange rate between the USD and CAD from the rate at December 31, 2023 would have resulted in a change of approximately $8.9 million in our net foreign exchange gain or loss.
At December 31, 2022, metals contained in concentrate sales and exposed to future price changes totaled approximately 3.1 million ounces of silver, 7,580 ounces of gold, 18.6 million pounds of zinc, and 12 million pounds of lead.
At December 31, 2023, metals contained in concentrate sales and exposed to future price changes totaled approximately 0.7 million ounces of silver, 3,490 ounces of gold, 0.4 million pounds of zinc, and 12 million pounds of lead.
The realized gains arose due to cash settlement of zinc contracts prior to maturity in 2022 for proceeds of $17.4 million. There were no early settlements in 2021 or 2020.
The realized gains arose due to cash settlement of zinc and lead contracts in 2023 and zinc contracts in 2022 prior to maturity for cash proceeds of $8.5 million and $17.4 92 million, respectively. There were no early settlements in 2021.
We recognized a net loss of $5.8 million during 2022 on the contracts utilized to manage exposure to prices of metals in our concentrate shipments, which is included in sales of products.
We recognized a net gain of $19.7 million during 2023 on the contracts utilized to manage exposure to prices of metals in our concentrate shipments, which is included in sales.
The following tables summarize the quantities of metals committed under forward sales contracts at December 31, 2022 and 2021: December 31, 2022 Ounces/pounds under contract (in 000's) Average price per ounce/pound Silver Gold Zinc Lead Silver Gold Zinc Lead (ounces) (ounces) (pounds) (pounds) (ounces) (ounces) (pounds) (pounds) Contracts on provisional sales 2023 settlements 3,124 8 18,629 11,960 $ 21.55 $ 1,795 $ 1.38 $ 0.98 Contracts on forecasted sales 2023 settlements — — 37,533 75,618 N/A N/A $ 1.34 $ 1.00 2024 settlements — — — 45,856 N/A N/A N/A $ 0.99 December 31, 2021 Ounces/pounds under contract (in 000's) Average price per ounce/pound Silver Gold Zinc Lead Silver Gold Zinc Lead (ounces) (ounces) (pounds) (pounds) (ounces) (ounces) (pounds) (pounds) Contracts on provisional sales 2021 settlements 1,814 6 13,371 4,575 $ 23.02 $ 1,812 $ 1.39 $ 0.96 Contracts on forecasted sales 2022 settlements — — 57,706 59,194 N/A N/A $ 1.28 $ 0.98 2023 settlements — — 76,280 71,650 N/A N/A $ 1.29 $ 1.00 84 Effective November 1, 2021, we designated the contracts for lead and zinc contained in our forecasted future shipments as hedges for accounting purposes, with gains and losses deferred to accumulated other comprehensive loss until the hedged product ships.
The following tables summarize the quantities of metals committed under forward sales contracts at December 31, 2023 and 2022: December 31, 2023 Ounces/pounds under contract (in 000's) Average price per ounce/pound Silver Gold Zinc Lead Silver Gold Zinc Lead (ounces) (ounces) (pounds) (pounds) (ounces) (ounces) (pounds) (pounds) Contracts on provisional sales 2023 settlements 735 3 441 15,542 $ 24.40 $ 2,045 $ 1.51 $ 1.00 Contracts on forecasted sales 2024 settlements — — — 56,713 N/A N/A N/A $ 0.98 2025 settlements — — — 49,273 N/A N/A N/A $ 0.98 December 31, 2022 Ounces/pounds under contract (in 000's) Average price per ounce/pound Silver Gold Zinc Lead Silver Gold Zinc Lead (ounces) (ounces) (pounds) (pounds) (ounces) (ounces) (pounds) (pounds) Contracts on provisional sales 2023 settlements 3,124 8 18,629 11,960 $ 21.55 $ 1,795 $ 1.38 $ 0.98 Contracts on forecasted sales 2023 settlements — — 37,533 75,618 N/A N/A $ 1.34 $ 1.00 2024 settlements — — — 45,856 N/A N/A N/A $ 0.99 Effective November 1, 2021, we designated the contracts for lead and zinc contained in our forecasted future shipments as hedges for accounting purposes, with gains and losses deferred to accumulated other comprehensive loss until the hedged product ships.
Within each tax group, all subsidiaries' estimated future taxable income contributes to the ability of their tax group to realize all such assets and liabilities. However, when Hecla's subsidiaries are viewed independently, we use the separate return method to assess the realizability of each subsidiary's deferred tax assets and whether a valuation allowance is required against such deferred tax assets.
However, when Hecla's subsidiaries are viewed independently, we use the separate return method to assess the realizability of each subsidiary's deferred tax assets and whether a valuation allowance is required against such deferred tax assets.
In consolidation, such activity is eliminated. • Deferred taxes . Our ability to realize deferred tax assets and liabilities is considered for two consolidated tax groups of subsidiaries within the United States: The Nevada U.S. Group and the Hecla U.S. Group.
Our ability to realize deferred tax assets and liabilities is considered for two consolidated tax groups of subsidiaries within the United States: The Nevada U.S. Group and the Hecla U.S. Group. Within each tax group, all subsidiaries' estimated future taxable income contributes to the ability of their tax group to realize all such assets and liabilities.
Management may also be required to make estimates related to the valuation of deferred tax assets or liabilities as part of the purchase price allocation for business combinations. In some cases, we use third-party appraisers to determine the fair values of property and other identifiable assets.
Management may also be required to make estimates related to the valuation of deferred tax assets or liabilities as part of the purchase price allocation for business combinations.
We have determined the functional currency for our Canadian and Mexican operations is the USD. As such, foreign exchange gains and losses associated with the re-measurement of monetary assets and liabilities from CAD and MXN to USD are recorded to earnings each period. For the year ended December 31, 2022, we recognized a net foreign exchange gain of $7.2 million.
As such, foreign exchange gains and losses associated with the re-measurement of monetary assets and liabilities from CAD to USD are recorded to earnings each period. For the year ended December 31, 2023, we recognized a net foreign exchange loss of $3.8 million. Foreign currency exchange rates are influenced by a number of factors beyond our control.
Commodity-Price Risk Management We may at times use commodity forward sales commitments, commodity swap contracts and commodity put and call option contracts to manage our exposure to fluctuation in the prices of certain metals we produce.
Therefore, the impact of changes in prices on the value of concentrates sold would be substantially offset by a gain or loss on forward contracts to the extent such contracts are utilized. 91 Commodity-Price Risk Management We may at times use commodity forward sales commitments, commodity swap contracts and commodity put and call option contracts to manage our exposure to fluctuation in the prices of certain metals we produce.
Net unrealized gains of approximately $0.1 million related to contracts not designated as hedges and no net unrealized gains or losses related to ineffectiveness of the hedges were included in fair value adjustments, net on our consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2022.
Net unrealized gains of approximately $1.2 million related to contracts not designated as hedges and no net unrealized gains or losses related to ineffectiveness of the hedges were included in fair value adjustments, net on our consolidated statements of operations and comprehensive (loss) income for the year ended December 31, 2023. 93 Interest Rates We have a $150 million credit facility, and amounts drawn on the facility are subject to variable rates of interest based on a spread over the London Interbank Offered Rate or an alternative base rate.
Each contract related to operating costs is designated as a cash flow hedge, while contracts related to development and interest costs have not been designated as hedges as of December 31, 2022. As of December 31, 2022, we had 278 forward contracts outstanding to buy a total of CAD$499 million having a notional amount of US$377.4 million.
Each contract related to operating costs is designated as a cash flow hedge, while contracts related to development and interest costs have not been designated as hedges as of December 31, 2023.
The CAD contracts are related to cash operating costs at Casa Berardi forecasted to be incurred from 2023 through 2026 and have CAD-to-USD exchange rates ranging between 1.26 and 1.3765.
As of December 31, 2023, we have a total of 576 forward contracts outstanding to buy a total of CAD $422.1 million having a notional amount of USD$332.3 million . The CAD contracts that are related to forecasted cash operating costs at Casa Berardi and Keno Hill from 2024-2026 and have CAD-to-USD exchange rates ranging between 1.27670 and 1.36920.
Certain of our derivative instruments reference LIBOR-based rates and were amended to eliminate the LIBOR-based rate references prior to January 1, 2023.
Certain of our derivative instruments previously referenced London Interbank Offered Rate ("LIBOR") based rates and have been amended to eliminate the LIBOR-based rate references prior to July 1, 2023. There have been no significant impacts to our financial results, financial position or cash flows from the transition from LIBOR to alternative reference interest rates.
Removed
New Accounting Pronouncements Accounting Standards Updates Adopted In August 2020, the Financial Accounting Standards Board (“FASB") issued ASU No. 2020-06 Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.
Added
In some cases, we use third-party appraisers to determine the fair values of property and other identifiable assets. 87 Valuation of Deferred Tax Assets Our deferred income tax assets include certain future tax benefits.
Removed
The update is to address issues identified as a result of the complexity associated with applying GAAP to certain financial instruments with characteristics of liabilities and equity. The update is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years and with early adoption permitted.
Added
New Accounting Pronouncements Accounting Standards Updates Adopted In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04 (“ASU 2020-04”), Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional guidance for a limited period of time to ease the potential burden on accounting for contract modifications caused by reference rate reform.
Removed
We adopted the update as of January 1, 2022, which did not have a material impact on our consolidated financial statements or disclosures.
Added
In January 2021, ASU 2021-01, Reference Rate Reform (Topic 848): Scope was issued which broadened the scope of ASU 2020-04 to include certain derivative instruments. In December 2022, ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848, was issued which deferred the sunset date of ASU 2020-04.
Removed
In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , which requires entities to recognize and measure contract assets and contract 80 liabilities acquired in a business combination in accordance with ASC 2014-09, Revenue from Contracts with Customers (Topic 606) .
Added
The guidance 88 is effective for all entities as of March 12, 2020 through December 31, 2024. The guidance may be adopted over time as reference rate reform activities occur and should be applied on a prospective basis.
Removed
The update will generally result in an entity recognizing contract assets and contract liabilities at amounts consistent with those recorded by the acquiree immediately before the acquisition date rather than at fair value. The update is effective on a prospective basis for fiscal years beginning after December 15, 2022, with early adoption permitted.
Added
Accounting Standards Updates to Become Effective in Future Periods In August 2023, the FASB issued ASU 2023-05, Business Combinations - Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, which clarifies the business combination accounting for joint venture formations.
Removed
We adopted the new standard effective January 1, 2022, which did not have a material impact on our consolidated financial statements or disclosures.
Added
The amendments in the ASU seek to reduce diversity in practice that has resulted from a lack of authoritative guidance regarding the accounting for the formation of joint ventures in separate financial statements. The amendments also seek to clarify the initial measurement of joint venture net assets, including businesses contributed to a joint venture.
Removed
Accounting Standards Updates to Become Effective in Future Periods In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform, in response to the 2017 United Kingdom Financial Conduct Authority ("FCA") announcement that after 2021 it would no longer compel banks to submit the rates required to calculate the London Interbank Offered Rate ("LIBOR"), which have been widely used as reference rates for various securities and financial contracts, including loans, debt and derivatives.
Added
The guidance is applicable to all entities involved in the formation of a joint venture. The amendments are effective for all joint venture formations with a formation date on or after January 1, 2025. Early adoption and retrospective application of the amendments are permitted.
Removed
This announcement indicated that the continuation of LIBOR on the current basis would not be guaranteed after 2021. Subsequently in March 2021, the FCA announced some USD LIBOR tenors (overnight, 1 month, 3 month, 6 month and 12 month) will continue to be published until June 30, 2023.
Added
We do not expect adoption of the new guidance to have a material impact on our consolidated financial statements and disclosures. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, amending reportable segment disclosure requirements to include disclosure of incremental segment information on an annual and interim basis.
Removed
Regulators in the U.S. and other jurisdictions have been working to replace these rates with alternative reference interest rates that are supported by transactions in liquid and observable markets, such as SOFR. Our New Credit Agreement references SOFR-based rates, compared to our prior credit facility which referenced LIBOR based- rates.
Added
Among the disclosure enhancements are new disclosures regarding significant segment expenses that are regularly provided to the chief operating decision-maker and included within each reported measure of segment profit or loss, as well as other segment items bridging segment revenue to each reported measure of segment profit or loss.
Removed
We do not expect a significant impact to our financial results, financial position or cash flows from the transition from LIBOR to alternative reference interest rates, but we will continue to monitor the impact of this transition until it is completed.
Added
The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, and are applied retrospectively. Early adoption is permitted. We are currently evaluating the impact of this update on our consolidated financial statements and disclosures.
Removed
Condensed Consolidating Balance Sheets As of December 31, 2022 Parent Guarantors Non-Guarantors Eliminations Consolidated (in thousands) Assets Cash and cash equivalents $ 69,889 $ 20,152 $ 14,702 $ — $ 104,743 Other current assets 4,959 147,103 10,922 — 162,984 Properties, plants, equipment and mineral interests - net 1,913 2,288,199 279,678 — 2,569,790 Intercompany receivable (payable) (159,442 ) (598,248 ) 303,433 454,257 — Investments in subsidiaries 2,128,366 — — (2,128,366 ) — Other non-current assets 355,631 20,870 43,241 (330,087 ) 89,655 Total assets $ 2,401,316 $ 1,878,076 $ 651,976 $ (2,004,196 ) $ 2,927,172 Liabilities and Stockholders' Equity Current liabilities $ (93,660 ) $ 134,016 $ 13,939 $ 124,171 $ 178,466 Long-term debt 506,364 11,378 0 — 517,742 Non-current portion of accrued reclamation — 101,900 6,508 — 108,408 Non-current deferred tax liability — 113,876 11,970 — 125,846 Other non-current liabilities 9,645 6,720 1,378 — 17,743 Stockholders' equity 1,978,967 1,510,186 618,181 (2,128,367 ) 1,978,967 Total liabilities and stockholders' equity $ 2,401,316 $ 1,878,076 $ 651,976 $ (2,004,196 ) $ 2,927,172 Condensed Consolidating Statements of Operations and Comprehensive (Loss) Income 82 Year Ended December 31, 2022 Parent Guarantors Non-Guarantors Eliminations Consolidated (in thousands) Revenues $ (5,823 ) $ 724,255 $ 473 $ — $ 718,905 Cost of sales 824 (459,169 ) (466 ) — (458,811 ) Depreciation, depletion, and amortization — (143,938 ) — — (143,938 ) General and administrative (18,645 ) (22,807 ) (1,932 ) — (43,384 ) Exploration and pre-development (684 ) (37,341 ) (8,016 ) — (46,041 ) Equity in earnings of subsidiaries 2,219 — — (2,219 ) — Other income (expense) (39,901 ) (39,904 ) (5,424 ) 13,584 (71,645 ) (Loss) income before income taxes (62,010 ) 21,096 (15,365 ) 11,365 (44,914 ) Benefit (provision) from income and mining taxes 24,662 (3,624 ) 115 (13,587 ) 7,566 Net (loss) income (37,348 ) 17,472 (15,250 ) (2,222 ) (37,348 ) Preferred stock dividends (552 ) — — — (552 ) (Loss) income applicable to common stockholders (37,900 ) 17,472 (15,250 ) (2,222 ) (37,900 ) Net income (loss) (37,348 ) 17,472 (15,250 ) (2,222 ) (37,348 ) Changes in comprehensive income (loss) 30,904 — — — 30,904 Comprehensive (loss) income $ (6,444 ) $ 17,472 $ (15,250 ) $ (2,222 ) $ (6,444 ) Condensed Consolidating Statements of Cash Flows Year Ended December 31, 2022 Parent Guarantors Non-Guarantors Eliminations Consolidated (in thousands) Cash flows from operating activities $ 381,771 $ (196,017 ) $ (206,375 ) $ 110,511 $ 89,890 Cash flows from investing activities: Additions to properties, plants, equipment and mineral interests — (130,104 ) (19,274 ) — (149,378 ) Other investing activities, net (587,685 ) 4,097 (19,967 ) 565,660 (37,895 ) Cash flows from financing activities: — Dividends paid to stockholders (12,932 ) — — — (12,932 ) Borrowings of debt 25,000 — — — 25,000 Repayments of debt (25,000 ) (6,918 ) (715 ) — (32,633 ) Other financing activity 113,628 334,809 240,799 (676,171 ) 13,065 Effect of exchange rate changes on cash — 200 (473 ) — (273 ) Changes in cash, cash equivalents and restricted cash and cash equivalents (105,218 ) 6,067 (6,005 ) — (105,156 ) Beginning cash, cash equivalents and restricted cash and cash equivalents 175,108 15,135 20,820 — 211,063 Ending cash, cash equivalents and restricted cash and cash equivalents $ 69,890 $ 21,202 $ 14,815 $ — $ 105,907 Forward-Looking Statements The foregoing discussion and analysis, as well as certain information contained elsewhere in this report, contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, and are intended to be covered by the safe harbor created thereby.
Added
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024 and are applied prospectively.
Removed
Therefore, the impact of changes in prices on the value of concentrates sold would be substantially offset by a gain or loss on forward contracts to the extent such contracts are utilized.
Added
Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the impact of this update on our consolidated financial statements and disclosures.
Removed
Foreign currency exchange rates are influenced by a number of factors beyond our control. A 10% change in the exchange rate between the USD and CAD from the rate at December 31, 2022 would have resulted in a change of approximately $8.0 million in our net foreign exchange gain or loss.
Added
Condensed Consolidating Balance Sheets As of December 31, 2023 Parent Guarantors Non-Guarantors Eliminations Consolidated (in thousands) Assets Cash and cash equivalents $ 89,377 $ 16,053 $ 944 $ — $ 106,374 Other current assets 15,929 127,531 10,428 — 153,888 Properties, plants, equipment and mineral interests - net 642 2,657,261 8,347 — 2,666,250 Intercompany receivable (payable) (132,464 ) (812,078 ) 589,842 354,700 — Investments in subsidiaries 2,248,533 — — (2,248,533 ) — Other non-current assets 432,468 21,960 29,353 (399,189 ) 84,592 Total assets $ 2,654,485 $ 2,010,727 $ 638,914 $ (2,293,022 ) $ 3,011,104 Liabilities and Stockholders' Equity Current liabilities $ 50,383 $ 141,439 $ 10,128 $ (44,490 ) $ 157,460 Long-term debt 636,000 17,063 0 — 653,063 Non-current portion of accrued reclamation — 108,731 2,066 — 110,797 Non-current deferred tax liability — 104,835 — — 104,835 Other non-current liabilities — 16,845 — — 16,845 Stockholders' equity 1,968,102 1,621,814 626,720 (2,248,532 ) 1,968,104 Total liabilities and stockholders' equity $ 2,654,485 $ 2,010,727 $ 638,914 $ (2,293,022 ) $ 3,011,104 90 Condensed Consolidating Statements of Operations and Comprehensive (Loss) Income Year Ended December 31, 2023 Parent Guarantors Non-Guarantors Eliminations Consolidated (in thousands) Revenues $ 19,677 $ 700,550 $ — $ — $ 720,227 Cost of sales (3,608 ) (454,896 ) — — (458,504 ) Depreciation, depletion, and amortization — (148,774 ) — — (148,774 ) General and administrative (17,222 ) (23,767 ) (1,733 ) — (42,722 ) Exploration and pre-development (559 ) (28,835 ) (3,118 ) — (32,512 ) Equity in earnings of subsidiaries (84,847 ) — — 84,847 — Other income (expense) (3,228 ) (127,326 ) (3,349 ) 13,193 (120,710 ) (Loss) income before income and mining taxes (89,787 ) (83,048 ) (8,200 ) 98,040 (82,995 ) Benefit (provision) from income and mining taxes 5,570 6,348 53 (13,193 ) (1,222 ) Net (loss) income (84,217 ) (76,700 ) (8,147 ) 84,847 (84,217 ) Preferred stock dividends (552 ) — — — (552 ) (Loss) income applicable to common stockholders (84,769 ) (76,700 ) (8,147 ) 84,847 (84,769 ) Net (loss) income (84,217 ) (76,700 ) (8,147 ) 84,847 (84,217 ) Changes in comprehensive income 3,389 — — — 3,389 Comprehensive (loss) income $ (80,828 ) $ (76,700 ) $ (8,147 ) $ 84,847 $ (80,828 ) Forward-Looking Statements The foregoing discussion and analysis, as well as certain information contained elsewhere in this report, contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, and are intended to be covered by the safe harbor created thereby.

Other HL 10-K year-over-year comparisons