Why Hecla Mining shares jumped today
US based silver and gold miner Hecla Mining (NYSE: HL) today announced its first quarter 2021 results and also increased the money-related portion of its dividend. Investors say they are happy with both of these events, with stocks trading more than 13% higher as of 11 a.m. EDT on Thursday.
Hecla reported revenue of $ 210 million, its second highest quarterly revenue since its founding in 1891 and a 54% increase from the previous year period. The company’s board of directors also slightly increased the money-related segment of its dividend to $ 0.01 per share. Hecla currently pays a basic annualized dividend of $ 0.015 per share, but adds another component based on its quarterly realized average price of silver.
Hecla’s dividend policy allows investors to participate in the gains made when silver prices rise. The base realized price is $ 25 and the company announced a quarterly silver price of $ 25.66, triggering this portion of the dividend. At this level, the money-related portion now represents $ 0.03 annualized, which represents an overall annual return of 0.6% for investors.
Each additional $ 5 increase in the average price of silver realized increases that portion of the dividend. “As prices go up, shareholders are expected to get a greater portion of the company’s cash flow, reflecting the continued rigor of the discipline of operating and capital costs,” said the president and CEO. Hecla’s General, Phillips S. Baker Jr., in a statement.
Mr Baker added that Hecla operates over a third of all US silver production and believes the price outlook remains positive. “He said the company sees” an improvement in industrial demand due to global policies that support green energy where money is key, high investment demand and tight supply. “Investors support his optimistic view today.
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