Hecla Reports First Quarter 2013 Results

Hecla Mining Company (NYSE:HL)
(Hecla or the Company) today announced first quarter net income
applicable to common shareholders of $11.0 million, or $0.04 per basic
share, and earnings after adjustments applicable to common shareholders
of $3.4 million, or $0.01 per basic share.¹ First quarter
silver production was 1.9 million ounces at a cash cost of $7.02 per
ounce, net of by-products.²

In addition, on May 9, 2013, Aurizon Mines Ltd. (Aurizon) shareholders
voted in favor of the Hecla acquisition. Hecla expects to complete the
acquisition of Aurizon during the second quarter upon receipt of
Investment Canada regulatory approval. Aurizon's core asset is the Casa
Berardi gold mine in Quebec, Canada, with 2013 gold production estimated
by Aurizon of 125,000 to 130,000 ounces. Also, subsequent to the first
quarter, the Company completed a $500 million offering of 6.875% Senior
Notes due 2021, which will partially fund the acquisition.

FIRST QUARTER 2013 HIGHLIGHTS

• 
  Sales of $76.5 million.
  
• 
  Net income applicable to common shareholders of $11.0 million, or
  $0.04 per basic share.
  
• 
  Earnings after adjustments applicable to common shareholders (a
  non-GAAP measure) of $3.4 ?million, or $0.01 per basic share.¹
• 
  Operating cash flow of $11.4 million.
  
• 
  Adjusted EBITDA (a non-GAAP measurement) of $33.3 million.
  
• 
  Greens Creek production of 1.8 million ounces of silver in the first
  quarter, a 34% increase over last year's first quarter, at an average
  cash cost (a non-GAAP measure) of $5.02 per ounce. Higher per ounce
  cash costs are due in part to lower base metals prices and production.
  
• 
  Total silver production of 1.9 million ounces at a total cash cost (a
  non-GAAP measure) of $7.02 ?per ounce, net of by-products.²
  Higher per ounce costs are due in part to production startup at Lucky
  Friday in February, which is expected to ramp up to normal production
  levels in the first half of the year. Cash costs per ounce are
  expected to decrease as production increases during this period.
  
• 
  Expenditures of $11.3 million on exploration and pre-development, 26%
  higher than the first quarter of 2012, to advance Hecla's major
  pre-development and exploration projects.
  
• 
  Exploration programs in the first quarter of 2013 succeeded in
  defining high-grade extensions to mineralization at San Sebastian and
  Greens Creek.
  
• 
  Cash and cash equivalents of $169 million at March ?31, 2013.
  
• 
  Declaration of $0.0025 common stock dividend under the Company's
  dividend policy. Realized silver price was $28.86 in the first quarter.
  

⁽¹⁾Earnings after adjustments applicable to common
shareholders represents a non-U.S. Generally Accepted Accounting
Principles (GAAP) measurement. A reconciliation of net income applicable
to common shareholders (GAAP) to earnings after adjustments can be found
at the end of the release.

⁽²⁾Total cash cost per ounce of silver represents a non-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 at the end of this release.

'During the first quarter we recommenced production at the Lucky Friday
mine, after a year of rehabilitation and enhancement, and expect the
mine to produce more than 2 million ounces of silver this year and 3
million ounces of silver in 2014,' said Phillips S. Baker, Jr.,
President and Chief Executive Officer. 'My ongoing thanks to the team at
the Lucky Friday who completed this work safely and efficiently, and the
team at Greens Creek whose effort generates the cash flow that's
carrying the Company through this period.?

'We are very pleased that the Aurizon shareholders recognized the
benefits of the acquisition by Hecla and voted in favor of the deal on
May 9, 2013. Hecla remains the largest primary silver producer in the
U.S., with, upon closing the Aurizon transaction, strong gold production
from Canada. The gold and two silver mines in the new Hecla are all
located in mining-friendly jurisdictions, and each has more than 10
years of mine life as well as organic growth potential. We expect to
have low-cost silver and gold production, reserve growth and strong cash
flows for many years to come,? Mr. Baker added.

'Another transformational event for the Company was the recent $500
million Senior Notes offering, which was up-sized during the offering
from $400 million, demonstrating market confidence not only in the
merits of the Aurizon acquisition, but also in Hecla's diverse, North
American asset base,? Mr. Baker said. 'Hecla's balance sheet remains
very strong, which should allow for our continued growth through
additional acquisitions as well as our organic growth projects as we
advance towards our targeted goal of 15 million ounces of silver
production by 2017.?

'There has been significant weakness in precious metals prices this
spring, which we are watching closely, but I am pleased to note the
increase in demand for the physical metal, particularly in the Middle
East and in Asia, that has emerged as a result of these lower prices,?
Mr. Baker concluded. 'I believe that in these times of price volatility
and uncertainty, those companies like Hecla with low costs, high margins
and the flexibility to scale back or increase discretionary expenditures
such as exploration, pre-development, capital and investments, will fare
the best.?

FINANCIAL OVERVIEW

Net income applicable to common shareholders for the first quarter was
$11.0 million, or $0.04 ?per share, compared to $12.4 million, or $0.04
per share, for the same period a year ago and was impacted by the
following items:

• 
  Exploration and pre-development expense increased to $11.3 million in
  the first quarter from $9.0 million in the same period in 2012. This
  expense relates to exploration work at Greens Creek in Alaska, and
  exploration and pre-development work at San Sebastian in Mexico, at
  the San Juan Silver project in Colorado, and the Star complex in North
  Idaho's Silver Valley near the Lucky Friday mine.
  
• 
  Aurizon acquisition costs of $5.3 million in the first quarter of 2013.
  
• 
  A $21.5 million gain on base metal derivative contracts for the first
  quarter, compared to a $5.2 ?million loss for the same period in 2012.
  A summary of the quantities of base metals committed at March ?31,
  2013, is included on page 5 of this release.
  
• 
  Lucky Friday suspension-related costs of $1.5 million in the first
  quarter compared to $6.2 ?million in the same period of the prior year.
  The Lucky Friday resumed limited production in February 2013, with a
  return to full production levels anticipated in mid-2013.
  
• 
  Losses of $2.7 million on provisional price adjustments compared to
  gains of $5.1 million in the same period of 2012. The provisional
  price adjustment related to zinc and lead contained in our concentrate
  shipments was largely offset by net gains on forward contracts of $2.4
  million for those metals, compared to a loss of $1.0 million during
  the comparable period last year.
  

Capital expenditures (including non-cash capital lease additions) at the
operations totaled $25.6 ?million for the first quarter ended March ?31,
2013. Expenditures at the Lucky Friday were $14.4 ?million and
expenditures at Greens Creek were $11.2 million. Capital expenditures at
Greens Creek and Lucky Friday are expected to be $145 million for the
year, a reduction of $7.0 million from estimates earlier in the year.

Pre-development expenditures totaled $4.8 million in the first quarter
of 2013. Pre-development expenditures in 2013 are now expected to be
approximately $21.0 million for infrastructure at the San Juan Silver
property in Creede, Colorado, and the San Sebastian property in Mexico,
a reduction of $3.0 ?million from estimates earlier in the year.

Exploration expenditures (on Hecla assets) for the first quarter of 2013
were $6.5 million. Exploration expenditures for 2013 are now expected to
be approximately $21.0 million, a $6.0 million reduction from estimates
earlier in the year.

Aurizon Mines Ltd. Acquisition

The acquisition of Aurizon is by a Plan of Arrangement, which is similar
to a U.S. merger and requires two-thirds approval by Aurizon
shareholders. On May 9, 2013, Aurizon's shareholders approved the
transaction. The Casa Berardi gold mine, Aurizon′s principal operating
mine, is well-known to the Company as Hecla has followed it closely
since 2006. Aurizon's expectation is that Casa Berardi will produce
125,000 to 130,000 ounces of gold in 2013 at a cash cost of $810 per
ounce, with a total of CAD$102 million in capital spending at Casa
Berardi and CAD$7.2 million of exploration during the year. The review
process currently underway by Investment Canada can take up to 75 days
from the application date, suggesting a decision is likely before June
5. Consideration for the acquisition is comprised of a maximum of
approximately CAD$514 million cash and 57 million shares of Hecla common
stock.

On May 2, 2013, Aurizon announced a minor discharge at the Casa Berardi
tailings facility. Aurizon expects that operations will not be impacted.
Observations from the Hecla team members that visited the site support
this expectation. The Company awaits the findings of the Quebec
Environment Ministry on the incident.

'I believe the acquisition of Aurizon and the related financing will
further transform Hecla into one of the world's lowest risk silver and
gold miners,? said Mr. Baker. 'When this transaction closes as expected
later this quarter, we will have added a third long-lived, low-cost
operating mine in a mining-friendly jurisdiction while strengthening our
balance sheet. I believe that in Hecla's 122-year history, we have never
had such good prospects.?

$500 Million Senior Notes Offering

On April 12, 2013, Hecla closed its offering of $500 million of 6.875%
Senior Notes due 2021 (the Notes) to qualified institutional buyers in
the United States pursuant to Rule 144A under the Securities Act of
1933, as amended (the Securities Act) and outside the United States
pursuant to Regulation S under the Securities Act. The size of the
offering represents an increase of $100 million from the $400 million
amount originally proposed. The interest on the Notes will be payable in
cash semi-annually in arrears. The Notes will mature on May 1, 2021. The
gross proceeds from the offering of the Notes were deposited into a
segregated escrow account, and Hecla intends to use the net proceeds
($490 million) to partially fund the acquisition of Aurizon. For more
information about the Notes and the Aurizon acquisition, see Hecla's
recent filings with the Securities and Exchange Commission.

Dividends

Common

TheBoard of Directors elected to declare a quarterly dividend of
$0.0025 per share of common stock, payable on or about June 5, 2013, to
shareholders of record on May ?28, ?2013. The realized silver price was
$28.86 in the first quarter and therefore did not trigger a larger
dividend under the Company's dividend policy.

Preferred

The Board of Directors has also elected to declare the regular quarterly
dividend of $0.875 per share on the outstanding Series B Cumulative
Convertible Preferred Stock, on a total of 157,816 shares outstanding.
This represents a total amount to be paid of approximately $138,000. The
cash dividend is payable July 1, 2013, to shareholders of record on
June ?14, ?2013.

Metals Prices

Realized silver prices in the first quarter of 2013 were $28.86 per
ounce, compared to the average realized price in the first quarter of
2012 of $36.59 per ounce.

Overall first quarter realized metals prices were slightly lower than
those in the fourth quarter of 2012, resulting in negative adjustments
to provisional settlements of $2.7 million compared to net positive
price adjustments to provisional settlements of $5.1 million in the
first quarter of 2012. The adjustment to provisional settlements is
largely due to changes in prices in the time period between the shipment
of concentrate and the final settlement. The provisional price
adjustment related to zinc and lead contained in our concentrate
shipments was largely offset by net gains on forward contracts of $2.4
million for those metals.

The following table summarizes the quantities of base metals committed
under financially settled forward sales contracts at March ?31, 2013:

OPERATIONS OVERVIEW

First quarter silver cash cost was $7.02 per ounce, net of by-products,
compared to $2.24 per ounce in the same period in 2012. The consolidated
costs include initial start-up costs from the Lucky Friday mine, which
recommenced operations in February and is expected to produce more than
2 ?million ounces of silver in 2013. Including Greens Creek, full year
2013 consolidated cash costs, net of by-product credits, are expected to
average approximately $5.00 per ounce of silver, a result that is
dependent on base metal prices returning to higher levels.

The following table provides the production summary on a consolidated
basis for the first quarter ended March ?31, 2013 and 2012:

Greens Creek Mine - Alaska

Silver production at Greens Creek was 1.8 million ounces in the first
quarter of 2013, 34% higher than the 1.3 million ounces in the same
period in 2012. The increase in silver production year-over-year was due
primarily to 20% higher tonnage and 15% higher grades compared to last
year.

Mining and milling costs per ton were up by 13% and 16%, respectively,
in the first quarter compared to the same period in 2012. The increase
in milling costs was primarily due to diesel fuel costs related to the
generation of more power on-site due to lower availability of less
expensive hydroelectric power, as a result of lower precipitation levels
in southeastern Alaska. Both mining and milling costs were impacted by
an increase in labor costs as a result of higher costs of medical and
other benefits and higher salary costs. Higher mining costs are also the
result of higher maintenance costs.

Approximately $12.0 million in gross profit related to first quarter
production has been shifted into the second quarter due to timing of a
barge shipment.

The cash cost per ounce of silver increased to $5.02 per ounce, compared
to $2.24 per ounce in the first quarter of last year, due primarily to
lower by-product credits as a result of lower by-product production.

During the first quarter, crews finished the 200 South development and
began rehabilitation of the 29 Ramp, as part of the East Ore project.

Lucky Friday Mine - Idaho

In February, the Lucky Friday recommenced production upon completion of
the rehabilitation and enhancement project of the 6,100 foot Silver
Shaft, the main access to the mine, and the 5900 bypass. In the first
quarter, Lucky Friday produced 120,000 ounces of silver at a cash cost
of $36.55 per ounce. The high cash costs are the result of the low
production levels in the early phase of the mine restart. Two of seven
production areas have restarted, and the Company anticipates a ramp-up
in mine output during the first half of the year as additional
production stopes come on line, with a return to full production levels
expected in mid-2013. Full year production is expected to total more
than 2 million ounces of silver with about 1.5 million ounces in the
second half of the year.

The Company resumed sinking of the #4 Shaft in early 2013 upon
completion of the Silver Shaft work and re-opening of the mine. Once
complete, the #4 Shaft project, an internal shaft at the Lucky Friday
mine, is expected to provide deeper access to higher grade material in
order to extend the operational life and to increase silver production
to 5 million ounces per year.

Total cash cost per silver ounce produced and cost per ton milled for
the first quarter of 2013 were generally higher than historical periods
of operating at full production. The higher per-unit costs are primarily
due to lower production, as mine output is limited until production
areas come on line. The Company anticipates the higher per-unit costs to
continue until the mine returns to full production in approximately
mid-2013.

In March, the Mine Safety and Health Administration (MSHA) officially
notified the Company that the Lucky Friday mine will not be issued a
potential pattern of violations (PPOV) notification, a possibility the
agency had indicated late last year.

EXPLORATION AND PRE-DEVELOPMENT

• 
  In the first quarter of 2013, exploration programs succeeded in
  defining high-grade extensions to mineralization at San Sebastian and
  Greens Creek.
  
• 
  At San Sebastian, drilling of the Middle Vein has extended a shallow,
  very high-grade, gold-silver vein to the southeast. In-fill drilling
  of the resource continues to intercept high-grade veins in oxide
  mineralization near surface.
  
• 
  Very high-grade mineralization over good widths was drilled at Greens
  Creek at the Deep Southwest, 5250 Zones and Gallagher.
  

Exploration and pre-development expenses were $6.5 million and $4.8
million, respectively, in the first quarter. This is about a $0.9
million increase in exploration and $1.4 million increase in
pre-development over the first quarter of 2012. Exploration at San
Sebastian was about one-third of the exploration total and advancing the
decline at the Bulldog represented about 80 percent of the
pre-development expense.

Full year exploration and pre-development expenses on Hecla assets are
expected to be about $9.0 million lower than estimates earlier in the
year, or $42 million, excluding Aurizon exploration programs.

Greens Creek - Alaska

Greens Creek exploration made significant progress in defining
high-grade extensions to mineralization along the Deep Southwest, 5250
and Gallagher ore trends. Deep Southwest is a recently discovered zone
which lies below and further west of the Southwest Zone. The geometry of
this body is currently being defined but it is open down dip and to the
southwest along strike. Significant intersections include 27.1 oz/ton
silver, 0.39 oz/ton gold, 13.3% zinc and 6.1% lead over 8.6 feet (Deep
Southwest); 21.5 oz/ton silver, 0.31 oz/ton gold, 8.9% zinc and 4.1%
lead over 10.5 feet (Deep Southwest) and 21.9 oz/ton silver, 0.05 oz/ton
gold, 5.8% zinc and 2.8% lead over 24.6 feet (5250 Zone). (See
additional drill assay highlights in tables at the end of the release.)
Drilling will continue in an effort to define and expand the Deep
Southwest further southwest and the 5250 Zone to the south; however, the
emphasis is expected to shift to in-fill drilling of the 200 South in an
effort to convert resources to reserves and exploration drilling to the
south and west that could extend mineralization beyond the current
high-grade resources.

San Sebastian - Mexico

Exploration

Re-examination of district potential near the past producing Francine
Vein at San Sebastian led to the discovery of both precious metal-rich
oxide and more base metal-rich sulfide mineralization at the Middle Vein
in 2012. Drilling during the quarter was a combination of in-fill
drilling to refine and upgrade the resource and exploration drilling
that extended the very high-grade, near-surface oxide resource to the
southeast. Recent drill intersections include 62.16 oz/ton silver and
0.34 oz/ton gold over 8.0 feet and 34.25 oz/ton silver and 0.22 oz/ton
gold over 8.4 feet (Middle Vein). (See additional drill assay highlights
in tables at the end of the release.) Drilling is expected to continue
along the prospective Middle Vein trend, which is currently defined for
approximately 3,000 feet along strike and to a depth of 1,000 feet and
appears open for extension along strike to the southeast. Drilling is
also planned for extensions to the Hugh Zone and Andrea Vein structures.

Pre-Development

Pre-development expenditures in the first quarter were primarily for
infrastructure and engineering and permitting studies at the San
Sebastian project as part of the focus on optimizing the mining and
processing of the veins. Scoping studies are in progress to determine
the production viability, rate and sequencing of mining the three areas
(Middle Vein, Hugh Zone and Andrea Vein) and are expected to be
completed in the third quarter. Drilling in the core of the Hugh Zone
for metallurgical samples has commenced and is expected to provide
material to refine the metallurgical processing and mill design.
Concurrent with the completion of the scoping studies, a ramp is being
engineered for initial construction expected this year to allow access
to both the Hugh Zone and Middle Vein. Hydrology and geotechnical
studies are all advancing.

San Juan Silver - Colorado

Exploration

Underground drilling in the Equity Vein system at the San Juan Silver
property continued to outline multiple zones of high-grade, gold and
silver-bearing veins near the intersection with the North Amethyst Vein.
(See drill assay highlights in tables at the end of the release.)
However, it did not generate sufficient tons to justify continuing at
this time. Planned exploration for the remainder of the year will focus
on the Bulldog Vein system.

Pre-Development

Development of the Bulldog infrastructure is continuing with the
2800-foot long decline now advanced over 1,300 feet. The expected fourth
quarter 2013 completion of the decline will access old workings and the
ore body. This decline provides access for the confirmation of the
resource and potential drill platforms for exploration. Scoping studies,
resource updates and economic models related to the Bulldog continue to
be advanced.

Silver Valley - Idaho

Exploration & Pre-Development

Drilling to follow-up on higher grade surface holes intersected narrow,
high-grade veins at the You Like and the newly defined Midnight veins
east of the current Star and You Like resources. (See drill assay
highlights in tables at the end of the release.) Underground drilling is
complete, and the Star underground infrastructure will be shut down
until the Star data is integrated into the Lucky Friday optimization
study.

Junior Exploration Investment Program

As part of the Company's junior exploration investment program initiated
in 2012, Hecla has recently made an investment in Brixton Metals
Corporation (Brixton). Brixton is a Canadian-based precious metals
exploration company currently focused on the exploration of the Thorn
Project located in the Atlin Mining District in northern British
Columbia. Exploration results at the Thorn property show several
different styles of precious metal mineralization that highlight the
potential for a substantive discovery.

CONFERENCE CALL AND WEBCAST

A conference call and webcast will be held Friday, May 10, at 10:00 a.m.
Eastern time to discuss these results. You may join the conference call
by dialing toll-free 1-877-415-3182 or for international dialing
1-857-244-7325. The participant passcode is HECLA. Hecla's live and
archived webcast can be accessed at www.hecla-mining.com
under Investors or via Thomson StreetEvents Network.

ABOUT HECLA

Established in 1891, Hecla Mining Company is the largest and lowest-cost
primary silver producer in the U.S. The Company has two operating mines
and exploration properties in four world-class silver mining districts
in the U.S. and Mexico.

Cautionary Statements to Investors on Forward-Looking Statements

Statements made which are not historical facts, such as anticipated
payments, litigation outcome (including settlement negotiations),
production, sales of assets, exploration results and plans, 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, litigation, regulatory and
environmental risks, operating risks, project development risks,
political 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.

Qualified Person (QP) Pursuant to Canadian National Instrument 43-101

All disclosures of a technical or scientific nature in this press
release have been reviewed and approved by Dean McDonald, P.Geo., Vice
President - Exploration of Hecla Mining Company, who serves as a
Qualified Person under National Instrument 43-101. Information regarding
data verification, surveys and investigations, quality assurance program
and quality control measures and a summary of analytical or testing
procedures for the Greens Creek Mine are contained in a technical report
titled 'Technical Report for the Greens Creek Mine? dated March 28,
2013, and for the Lucky Friday Mine are contained in a technical report
titled 'Technical Report for the Lucky Friday Mine Shoshone County,
Idaho, USA? dated March 28, 2013. Also included in these two technical
reports is a description of the key assumptions, parameters and methods
used to estimate mineral reserves and resources and a general discussion
of the extent to which the estimates may be affected by any known
environmental, permitting, legal, title, taxation, socio-political,
marketing or other relevant factors. Copies of these two technical
reports are available under Hecla's profile on SEDAR at www.sedar.com.

Cautionary Statements to Investors on Reserves and Resources

Reporting requirements in the United States for disclosure of mineral
properties are governed by the SEC and included in the SEC's Securities
Act Industry Guide 7, entitled 'Description of Property by Issuers
Engaged or to be Engaged in Significant Mining Operations? ('Guide 7?).
However, the Company is also a 'reporting issuer' under Canadian
securities laws, which require estimates of mineral resources and
reserves to be prepared in accordance with Canadian National Instrument
43-101 ('NI 43-101?). NI 43-101 requires all disclosure of estimates of
potential mineral resources and reserves to be disclosed in accordance
with its requirements. Such Canadian information is being included here
to satisfy the Company's 'public disclosure? obligations under
Regulation FD of the SEC and to provide U.S. holders with ready access
to information publicly available in Canada.

Reporting requirements in the United States for disclosure of mineral
properties under Guide 7 and the requirements in Canada under NI 43-101
standards are substantially different. This document contains a summary
of certain estimates of the Company, not only of proven and probable
reserves within the meaning of Guide 7, which requires the preparation
of a 'final? or 'bankable? feasibility study demonstrating the economic
feasibility of mining and processing the mineralization using the
three-year historical average price for any reserve or cash flow
analysis to designate reserves and that the primary environmental
analysis or report be filed with the appropriate governmental authority,
but also of mineral resource and mineral reserve estimates estimated in
accordance with the definitional standards of the Canadian Institute of
Mining, Metallurgy and Petroleum referred to in NI 43-101. The terms
'measured resources?, 'indicated resources,' and 'inferred resources'
are Canadian mining terms as defined in accordance with NI 43-101. These
terms are not defined under Guide 7 and are not normally not permitted
to be used in reports and registration statements filed with the SEC in
the United States, except where required to be disclosed by foreign law,
as is the case here. Still, investors are cautioned not to assume that
any part or all of the mineral deposits in such categories will ever be
converted into proven or probable reserves. 'Resources? have a great
amount of uncertainty as to their existence, and great uncertainty as to
their economic and legal feasibility. It cannot be assumed that all or
any part of such a 'resource? will ever be upgraded to a higher category
or will ever be economically extracted. Investors are cautioned not to
assume that all or any part of a 'resource? exists or is economically or
legally mineable. Investors are also especially cautioned that the mere
fact that such resources may be referred to in ounces of silver and/or
gold, rather than in tons of mineralization and grades of silver and/or
gold estimated per ton, is not an indication that such material will
ever result in mined ore which is processed into commercial silver or
gold.

(1) Total cash costs 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 cash
costs per ounce reconciliation section of this news release. Gold, lead
and zinc produced have been treated as by-product credits in calculating
silver costs per ounce.

Non-GAAP Measures

(Unaudited)

Reconciliation of Cash Costs per Ounce to Generally Accepted
Accounting Principles (GAAP)

This release contains references to a non-GAAP measure of cash costs per
ounce. Cash costs per ounce of silver represent non-U.S. Generally
Accepted Accounting Principles (GAAP) measurements that the Company
believes provide management and investors an indication of net cash
flow. Management also uses this measurement for the comparative
monitoring of performance of mining operations period-to-period from a
cash flow perspective. 'Total cash cost per ounce' is a measure
developed by mining companies in an effort to provide a comparable
standard; however, there can be no assurance that our reporting of this
non-GAAP measure is similar to that reported by other mining companies.
Cost of sales and other direct production costs and depreciation,
depletion and amortization was the most comparable financial measures
calculated in accordance with GAAP to total cash costs.

The following table calculates cash cost per ounce:

(1) Production had been temporarily suspended at the Lucky Friday Unit
in 2012 as work was performed to rehabilitate and enhance the Silver
Shaft, the primary access from surface to the underground workings at
the Lucky Friday mine. The Silver Shaft work was completed in early
2013, and limited production resumed at the Lucky Friday starting in
February 2013. Care and maintenance costs incurred at the Lucky Friday
during the suspension of production are included in a separate line item
under Other operating expenses on the Condensed Consolidated Statement
of Operations and Comprehensive Income (Unaudited), and have been
excluded from the calculation of total cash costs for the three month
periods ended March 31, 2013 and 2012.

Reconciliation of Earnings After Adjustments Applicable to Common
Shareholders to Generally Accepted Accounting Principles (GAAP)

This release also refers to a non-GAAP measure of earnings after
adjustments. Earnings After Adjustments and Earnings After Adjustments
per share are non-GAAP measures which are indicators of our performance.
They exclude certain impacts which are of a nature which we believe are
not reflective of our underlying performance. Management believes that
earnings after adjustments per common share provides investors with the
ability to better evaluate our underlying operating performance. The
following table reconciles net income applicable to common shareholders
to earnings after adjustments applicable to common shareholders:

Reconciliation of Adjusted EBITDA to Generally Accepted Accounting
Principles (GAAP)

This release refers to a non-GAAP measure of Adjusted earnings before
interest, taxes, depreciation and amortization ('Adjusted EBITDA'),
which is a measure of our operating performance. Adjusted EBITDA is
calculated as net income before the following items: interest expense,
income tax provision, depreciation, depletion, and amortization expense,
exploration expense, pre-development expense, Aurizon acquisition costs,
Lucky Friday suspension-related costs, interest and other income
(expense), gains and losses on derivative contracts, and provisional
price gains and losses. Management believes that, when presented in
conjunction with comparable GAAP measures, Adjusted EBITDA is useful to
investors in evaluating our operating performance. The following table
reconciles net income to Adjusted EBITDA:

Table 2 - Assay Results - Q1 2013

Note: All assay intervals represent true widths of drill core with the
exception of the results from Greens Creek. At Greens Creek the assay
intervals represent the horizontal width because the mineralized bodies
are very irregular in shape and in most cases this is the best
approximation for true width.