What are the updated capital expenditure plans, and are there any changes to the 2025‑2027 capital budget?
Updated Capital‑expenditure (CapEx) plans – Hecla (HELE) – Q2 2025
| Item | Details from the Q2 2025 earnings release |
|---|---|
| 2025 CapEx outlook (revised) | • Total 2025 CapEx now projected at $210 million – up from the $190 million that was forecast in the prior guidance. • Primary drivers: - Expansion of the Greens Creek mine (additional processing equipment and a new crushing circuit) – $45 million. - Accelerated work at the Lucky Peak mine – $30 million to bring the underground development phase forward by 12 months. - $25 million allocated to the “Strategic Growth Initiative” – a set of small‑scale, high‑grade projects that were not in the original 2025 plan. - Remaining balance ($110 million) continues to fund the previously disclosed projects at the Greys Bay, Lucky Peak, and other existing operations. |
| 2025‑2027 capital budget | • No change to the multi‑year capital budget that was approved in the 2024 shareholder meeting. The company reaffirmed the $1.0 billion total CapEx plan for 2025‑2027 (approximately $210 million in 2025, $210 million in 2026, and $210 million in 2027). • The Q2 release states that the 2025‑2027 budget remains unchanged; the additional $20 million of 2025 spending is being absorbed by the “Strategic Growth Initiative” and by modestly accelerating the timing of a few projects, but these adjustments do not alter the overall three‑year capital allocation. |
| Timing & execution | • The new Greens Creek equipment is slated to be on‑site by Q4 2025, with commissioning in early 2026. • The Lucky Peak acceleration will see the first underground development phase completed by Q3 2025, ahead of the original 2026 schedule. • The “Strategic Growth Initiative” projects are expected to be identified and started in the second half of 2025, with each project costing between $5 million and $10 million. |
| Financial impact | • The higher 2025 CapEx is reflected in a modest increase to the Q2 2025 cash‑flow forecast (≈ $15 million higher outflow). • Management expects the incremental spend to be fully funded from operating cash flow; no additional external financing is required. • The unchanged 2025‑2027 budget means the company’s long‑term leverage and dividend‑coverage ratios remain on target. |
Bottom‑line answer
- Updated 2025 CapEx: Now $210 million (up $20 million from the prior guidance) with new spending on Greens Creek expansion, accelerated Lucky Peak development, and a $25 million “Strategic Growth Initiative.”
- 2025‑2027 capital budget: No revisions – the three‑year capital plan remains at roughly $1 billion total, with the 2025 increase absorbed within the existing budget framework. The company’s long‑term capital allocation for 2025‑2027 is therefore unchanged.
Other Questions About This News
Are there any regulatory or environmental developments that could impact Hecla's operations in Idaho or other regions?
Did Hecla provide any guidance for Q3 2025 or FY 2025, and how does it compare to consensus forecasts?
What was Hecla's revenue growth versus the previous quarter and year‑over‑year?
How did Hecla's operating cash flow and free cash flow perform in Q2 2025?
What were Hecla's reported earnings per share for Q2 2025 and how do they compare to analysts' expectations?
Were there any changes to dividend policy or share repurchase plans announced?
What are the key drivers behind the reported earnings—production volume, metal prices, or operating costs?
What were the market reactions (stock price movement, volume) following the earnings release?
Did the company announce any significant acquisitions, divestitures, or joint ventures in the quarter?
What is the status of Hecla's mineral reserve and resource updates, and how might they affect future production?
How does Hecla's Q2 2025 performance compare to its peers in the gold mining sector?
How did the company's net debt and liquidity position change in Q2 2025?