Lower prices, output hurt Hecla in 1991

A net loss of US$15.4 million was reported by Hecla Mining (NYSE) for 1991, a downturn from 1990 when the company recorded net earnings of US$6.7 million.

A loss of US$1.9 million on revenue of $27.3 million was reported for the 1991 fourth quarter ended Dec. 31, compared with a loss of US$2.3 million on revenue of US$37.3 million for the same period in 1990.

The Idaho-based company said its 1991 results reflect a decrease in precious and base metals prices, as well as a decrease in metals production. The decline in gold production in 1991 was attributed primarily to lower production at the Yellow Pine mine in Idaho as that deposit was mined out. Gold production is expected to decline further this year when mining will be completed at the Cactus operation in California. But Hecla projects its gold production will rise in 1993 when the Grouse Creek property in Idaho begins production. Grouse Creek is currently in the final permitting stages, and construction is expected to begin in mid-1992.

In the meantime, Hecla is continuing to evaluate the La Choya gold property in Mexico. The company has an option to purchase the property, and if such a decision is made, ongoing exploration would be intensified to expand the current reserve base.

Hecla recently merged with CoCa Mines and its prior years’ results were restated to reflect the merger and are accounted for on a

“pooling-of-interests” basis. This allows comparison of current statements with those of the previous year.