Canaccord Genuity Global Resource Conference October 16-18, 2012 H - PowerPoint PPT Presentation

C R E AT I N G V AL U E H E C L A P R O P E R T I E S O R G AN I C G R O W T H K E Y M I L E S T O N E S Canaccord Genuity Global Resource Conference October 16-18, 2012

H E C L A M I N I N G C O M P A N Y Cautionary Statements Cautionary Statements Statements made which are not historical facts, such as anticipated payments, litigation outcome, production, sales of assets, exploration results and plans, prospects and opportunities including reserves, resources, and mineralization, costs, and prices or sales performance are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may”, “will”, “should”, “expects”, “intends”, “projects”, “believes”, “estimates”, “targets”, “anticipates” and similar expressions are used to identify these forward-looking statements. Forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those projected, anticipated, expected or implied. These risks and uncertainties include, but are not limited to, metals price volatility, volatility of metals production and costs, environmental and litigation risks, operating risks, project development risks, political and regulatory risks, labor issues, ability to raise financing and exploration risks and results. Refer to the company's Form 10-K and 10-Q reports for a more detailed discussion of factors that may impact expected future results. The company undertakes no obligation and has no intention of updating forward-looking statements other than as may be required by law. Cautionary Statements to Investors on Reserves and Resources The United States Securities and Exchange Commission permits mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms on this release, such as “resource,” “other resources,” and “mineralized materials” that the SEC guidelines strictly prohibit us from including in our filings with the SEC. U.S. investors are urged to consider closely the disclosure in our Form 10-K and Form 10-Q. You can review and obtain copies of these filings from the SEC's website at www.sec.gov. Cautionary Note Regarding Non-GAAP measures Total cash cost per ounce of silver and earnings before adjustments represent non-U.S. Generally Accepted Accounting Principles (GAAP) measurements. A reconciliation of total cash cost to cost of sales and other direct production costs and depreciation, depletion and amortization (GAAP) can be found in the Appendix. 2

H E C L A M I N I N G C O M P A N Y New Innovation has Changed Demand  February 1900  Long-running popular series of simple and inexpensive cameras  Introduced the concept of the “snapshot”  Transformed the demand of silver  Today new innovation has changed demand again 3

H E C L A M I N I N G C O M P A N Y Hecla Characteristics Record Production Exploration and Cash Flow and Pre- Growth Development Delivering Growth & Value Low Political Low Cost Risk Producer Strong Balance Sheet 4

H E C L A M I N I N G C O M P A N Y Growth and Value in Silver #1 primary silver producer in the U.S., more than 6 million ounces expected in 2012. 50% silver production growth planned in 2013 with re-opening of Lucky Friday mine. $26.02 per ounce cash margin 1 (over 90%) allowing high operating leverage to silver prices. $233 million in cash and cash equivalents, no significant debt. 2 2.0% Q2/2012 dividend yield. 3 6 Consecutive years replacing annual production and adding to reserves - record 2012 exploration and pre-development program. 1. From an average realized price of $27.05 and a cash cost per ounce of $1.03, net of by products in Q2 2012. 2. As of June 30, 2012. 3. As of stock price on July 31, 2012. 5

H E C L A M I N I N G C O M P A N Y North American Focus  Two long-lived silver mines – 148 mm ounces of high-grade silver reserves  Greens Creek mine – one of the world’s lowest cost primary silver mines • 2012 production estimated at over 6 mm ounces  Lucky Friday mine re-opening in Q1 2013 at ≈ 3 mm oz. annual silver production, expected to increase to ≈ 5 mm ounces  Organic growth at five highly- prospective properties: planned production of over 15 mm ounces by 2017 6

H E C L A M I N I N G C O M P A N Y Greens Creek (Alaska) Low-Cost Production  100% owned – one of the world’s largest and lowest cost primary silver mines  200 mm ounces of historical silver production  2012 production over 6 mm ounces  1 st six months cash cost $1.63/oz (non-GAAP)  Large and under-explored 27- square-mile land position  98.4 mm ounces of silver reserves  $90 mm planned CapEx in 2012 7

H E C L A M I N I N G C O M P A N Y Q2 2012 - Total Cash Costs $1.03 per oz $40 $36.59 $35.30 $35 97% $30 $27.05 Strong Cash Margins 94% $25 $22.70 96% 106% $20 $34.35 $/oz $15.63 $34.15 $13.78 $12.10 $14.40 $15 $26.02 88% 71% $24.16 120% $10 98% 98% $10.20 $13.72 $16.59 $11.86 $5 $0 $0.24 $4.20 $1.91 $1.03 $2.24 $1.15 ($1.46) ($2.81) ($5) 2006 2007 2008 2009 2010 2011 Q1/12 Q2/12 1 2 Cash Cost Per Ounce Cash Margin Realized Silver Price 1. Total cash cost per ounce of silver represents a non-U.S. Generally Accepted Accounting Principles (GAAP) measurement. A reconciliation of total cash costs to cost of sales and other direct production costs and depreciation, depletion and amortization (GAAP) can be found in the Appendix. 2. Realized prices are calculated by dividing gross revenues for each metal by the payable quantities of each metal included in the concentrate and doré sold during the period. 8

H E C L A M I N I N G C O M P A N Y Lucky Friday (Idaho) Resuming Production  Silver production expected to resume in Q1 2013  Yearly production levels of ≈ 3 mm ounces expected to increase to ≈ 5 mm ounces  Increases company-wide production by ≈ 50%  49.4 mm ounces silver reserves  118.8 mm ounces silver resources  Resumption of #4 Shaft construction to access higher grades 9

H E C L A M I N I N G C O M P A N Y Silver Shaft Schedule Key Activities 2011 2012 2013  Project Start Dec-11  Start Crane Work Below Silver Shaft Collar Feb-12  Start Galloway Work Mar-12  Start Rehabilitation at 1000 Level Apr-12  Rehabilitation Work Complete to 4900 Level Early Aug-12  Rehabilitation Work Complete to 6100 Level Early Dec-12  Final Utility Installation Early Dec-12  Silver Shaft Operational Dec-31-12  Full Production Early 2013 10

H E C L A M I N I N G C O M P A N Y Record 2012 Exploration/Pre-Development Budget  Estimated $53 million of exploration and pre-development  Approximately $30 million exploration  Approximately $23 million pre-development  Greens Creek Greens Creek 98.4 mm oz Proven & Probable Silver Reserves  ~$7 million exploration 2.6 mm oz Mineralized Material Silver Resources 52.6 mm oz Other Silver Resources  Silver Valley Silver Valley 3.2 mm oz Mineralized Material Silver Resources 8.2 mm oz Other Silver Resources  ~$7 million exploration Lucky Friday 49.4 mm oz Proven & Probable Silver Reserves  ~$5 million of pre-development 118.8 mm oz Mineralized Material Silver Resources at the Star complex 42.5 mm oz Other Silver Resources San Juan Silver  7.6 mm oz Mineralized Material Silver Resources San Juan Silver 29.5 mm oz Other Silver Resources  ~$12 million exploration San Sebastian 15.9 mm oz Other Silver Resources  ~$16 million pre-development  San Sebastian  ~$4 million exploration  ~$2 million pre-development 11

H E C L A M I N I N G C O M P A N Y Delivering Value: Reserve and Resource Growth 115% Increase of Silver Reserves from 2000-2011 281 248 192 148 142 132 118 92 92 69 51 44 46 33 2000 2002 2004 2006 2008 2010 2011 Resources (mm oz) Reserves (mm oz) 12

H E C L A M I N I N G C O M P A N Y Strong Balance Sheet Cash and Cash Equivalents (millions) $414 $377 $279 $266 1 $233 Q2/11 Q3/11 Q4/11 Q1/12 Q2/12 1. After environmental litigation settlement payment of $168 million in the fourth quarter 2011. 13

H E C L A M I N I N G C O M P A N Y Development Driving Production Growth Silver Production Historical Forecasted 15 14 Change in production due to lower 13 grade in mine plan sequence 12 11 10 Silver - mm oz 9 8 7 6 5 4 3 2 1 - 2007 2008 2009 2010 2011 2012E 2013E 2014E 2015E 2016E 2017E 1 1. No production at Lucky Friday in 2012 – Silver Shaft clean-up and mine upgrades (see slide in Appendix). 14

H E C L A M I N I N G C O M P A N Y Value Proposition 2011 Cash Flow - Price / Cash Flow 450 Coeur 400 Pan American 350 2011 Cash Flow - US$ MM Hecla Valuation at 300 Average P/CF Hecla H1/2011A Multiple* 250 200 First Majestic 150 Silvercorp 100 Endeavour Silver 50 Fortuna 0 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 Market Cap - US$ Billions 15 * Weighted Average P/CF 2011A multiple of companies shown in chart – 10.58x, with the exception of Hecla. Stock prices as of October 10, 2012.

H E C L A M I N I N G C O M P A N Y Silver Price Past Decade Silver Price 2002-2012 $50 $45 $40 $35 Silver Price - $/oz $30 $25 $20 $15 $10 $5 $- 2002 2004 2006 2008 2010 2012 Source: Bloomberg 16