Finvest
HL Metals & Mining · Silver · North America · Precious metals · Thesis updated June 14, 2026

Silver pivot, Keno delay

01 Running thesis

Clean silver story, slower growth

Hecla has done the thing bulls wanted. It sold Casa Berardi, cut down debt, and made the company much more focused on silver in the U.S. and Canada. That focus matters because silver prices have been high, and the core mines are throwing off cash.

The problem is Keno Hill. This mine was supposed to be the next growth step. Management now says the key permits needed to remove long-term waste rock and tailings limits may not arrive until sometime around mid-2029. Until then, investors should expect a more steady rate, or even a slower rate if short-term relief does not come.

That makes Hecla a cash-flow story more than a near-term growth story. Greens Creek and Lucky Friday can fund projects, dividends, and maybe more capital returns. But if the silver price weakens, or if either mature mine stumbles, there is less help coming from Keno Hill before the end of the decade.

May 2026▼Management said Keno Hill's key amended permits may not arrive until sometime around mid-2029. That pushes the main growth catalyst out by several years.
May 2026▼The Q1 2026 Form 10-Q confirmed the Casa Berardi sale, but also gave more detail on Keno Hill tailings, waste rock, and water limits. The cleaner silver story came with a sharper growth risk.
Feb 2026▲Management pointed to rapid deleveraging and a path to a debt-free balance sheet in 2026. Keno Hill also posted its first full year of profitability under Hecla ownership.
Feb 2026▲Hecla agreed to sell Casa Berardi for up to $593 million in total consideration. The deal focused the company on silver, though much of the value was deferred or contingent.
Nov 2025▲Net leverage fell to 0.3x and all four producing assets generated positive free cash flow for a second straight quarter. At that time, management still expected Keno Hill commercial production in 2027 and full capacity in 2028.
Nov 2025→Hecla kept Casa Berardi running to benefit from high gold prices, helping near-term cash flow. New groundwater and permit risks at Keno Hill offset part of that good news.
Aug 2025▲Management laid out a plan to take Keno Hill to 440 tons per day by 2028 and retired $212 million of debt. That improved the growth and balance sheet story at the time.
Aug 2025▼The Q2 2025 Form 10-Q raised the possibility that Keno Hill could go on care and maintenance if permits and ramp-up work did not improve. That made the project risk much clearer.
02 Business model

Ore in, metal out

Hecla mines ore, processes it, and sells concentrates and doré to third-party smelters and refiners. Its main product is silver. It also sells gold, lead, zinc, and a small amount of copper that come out of the same ore.

Those extra metals are important. Hecla treats gold, lead, zinc, and copper as by-product credits, which means their value lowers the reported cost of each silver ounce. In Q1 2026, silver sales were $295.6 million out of $406.8 million of metal sales, so the company is now clearly tied to silver prices.

The model breaks when permits, mine grades, labor, power, or metal prices move the wrong way. Keno Hill adds a special risk because it has not yet met Hecla's definition of commercial production, so its cost data is less comparable to Greens Creek and Lucky Friday.

03 Product portfolio

What Hecla sells

Cash cow

Silver

Silver is the main product at Greens Creek, Lucky Friday, and Keno Hill. It drives the story and most of the metal sales.

Steady

Gold

Gold mainly comes from Greens Creek after the Casa Berardi sale. It helps lower silver costs through by-product credits.

Steady

Lead

Lead is sold from the silver mines as part of concentrate shipments. It is smaller than silver, but it still helps cash costs.

Steady

Zinc

Zinc is another by-product from the core mines. Higher zinc prices can make reported silver costs look better.

Option

Environmental remediation services

Hecla also records small revenue from remediation work in the Yukon. It is pass-through work with minimal margin, not the main business.

04 Business segments

Three mines do the work

Greens Creek61%flat
Lucky Friday27%flat
Keno Hill11%modest
Other1%declining

Mix is based on Q1 2026 sales from continuing operations in Hecla's Form 10-Q: Greens Creek $251.0 million, Lucky Friday $109.4 million, Keno Hill $46.4 million, and Other $4.7 million. Greens Creek and Lucky Friday made up about 88% of total Q1 sales, so Hecla is still concentrated in two mature mines.

05 Risk factors

What can break

Keno Hill permit clock

High impact · High odds

Keno Hill needs amended permits to remove long-term limits on waste rock and tailings. Management expects to submit a project proposal to YESAB by year-end 2026, with amended permits possible sometime around mid-2029. Any delay pushes the growth case further out.

We watchThe YESAB project proposal submission, YESAB review timing, and any change to the mid-2029 permit target.

Keno Hill capacity squeeze

High impact · Medium odds

The currently permitted Phase 2E dry-stack tailings area is expected to reach capacity around October 2026. At current mining rates, the waste rock production limit could be reached around mid-2027. Without short-term regulatory relief or new approvals, production could slow or stop.

We watchPhase 2W approval, waste rock limit updates, and management comments on steady state tonnes per day.

Silver and gold price reversal

High impact · Medium odds

Hecla's Q1 2026 results were helped by much higher realized prices for silver and gold. If prices fall, by-product credits shrink and cash flow can drop quickly. This matters more now because Keno Hill growth is delayed.

We watchRealized silver and gold prices, by-product credits, and free cash flow at Greens Creek and Lucky Friday.

Two-mine dependence

Medium impact · Medium odds

Greens Creek and Lucky Friday carried most of Q1 sales. That is good when both mines run well, but it leaves less room for error. A grade issue, cost spike, labor problem, or power disruption at either mine would hit the company hard.

We watchQuarterly production, ore grades, AISC, and capital spending at Greens Creek and Lucky Friday.

Casa Berardi payment risk

Medium impact · Medium odds

Hecla sold Casa Berardi for a mix of cash, Orezone shares, deferred payments, and contingent payments. The Form 10-Q valued deferred cash consideration at $57.1 million and contingent cash consideration at $35.9 million. Some future value depends on permits, gold prices, production, and Orezone performance.

We watchOrezone payments, Orezone share value, Casa Berardi permit news, and any set-off tied to closure costs.
06 Quick answers

In one breath

Is Hecla mainly a silver company now?

Yes. After selling Casa Berardi on March 25, 2026, Hecla is focused on three silver assets: Greens Creek, Lucky Friday, and Keno Hill. It still sells gold, lead, and zinc as by-products.

What is the main issue at Keno Hill?

Keno Hill needs permit changes for waste rock, tailings, water, and related infrastructure. Management now expects key amended permits sometime around mid-2029, so the mine may stay at a steady or slower rate until then.

Why does Greens Creek matter so much?

Greens Creek is Hecla's largest segment by Q1 2026 sales. It also produces gold, zinc, and lead by-products, which can lower reported silver costs.

What should investors watch over the next year?

Watch Keno Hill short-term relief talks, the YESAB proposal by year-end 2026, and free cash flow from Greens Creek and Lucky Friday. A board decision on capital returns would also be important.