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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2004

Commission file number      1-8491      

     HECLA MINING COMPANY     
(Exact name of registrant as specified in its charter)

Delaware   82-0126240  
(State or other jurisdiction of  (I.R.S. Employer 
incorporation or organization)  Identification No.) 

6500 Mineral Drive, Suite 200		 
Coeur d'Alene, Idaho   83815-9408  
(Address of principal executive offices)  (Zip Code) 

208-769-4100
(Registrant’s telephone number, including area code)

        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for at least the past 90 days. Yes XX . No __.

        Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes XX . No __.

        Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Class   Shares Outstanding August 6, 2004  
Common stock, par value  118,279,861 
$0.25 per share 

Hecla Mining Company and Subsidiaries

Form 10-Q

For the Quarter Ended June 30, 2004

I N D E X* 


                                                                                                 Page
                                                                                                 ----
PART I. - Financial Information

        Item l  -        Condensed Financial Statements (unaudited)

                -        Consolidated Balance Sheets -
                         June 30, 2004 and December 31, 2003                                       3

                -        Consolidated Statements of Operations and Comprehensive
                         Income - Three Months and Six Months Ended
                         June 30, 2004 and 2003                                                    4

                -        Consolidated Statements of Cash Flows -
                         Six Months Ended June 30, 2004 and 2003                                   5

                -        Notes to Consolidated Financial Statements                                6

        Item 2  -        Management's Discussion and Analysis of
                         Financial Condition and Results of Operations                            21

        Item 3 -         Quantitative and Qualitative Disclosures About Market Risk               43

        Item 4 -         Controls and Procedures                                                  45

PART II. - Other Information

        Item 1  -        Legal Proceedings                                                        46

        Item 3 -Defaults Upon Senior Securities                                                   46

        Item 4 -Submission of Matters to a Vote of Security Holders                               46

        Item 6- Exhibits and Report on Form 8-K                                                   46

*Certain items are omitted as they are not applicable.

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Part I - Financial Information

Hecla Mining Company and Subsidiaries

Consolidated Balance Sheets (Unaudited)
(In thousands, except shares)

June 30,
2004		 December 31,
2003
                                     ASSETS            
   
Current assets:  
   Cash and cash equivalents   $ 80,418   $ 105,387  
   Short-term investments    27,937    18,003  
   Accounts and notes receivable    15,278    16,318  
   Inventories    19,984    16,936  
   Deferred income taxes    654    1,427  
   Other current assets    7,673    3,174  
           Total current assets    151,944    161,245  
Investments    1,539    722  
Restricted investments    19,509    6,447  
Properties, plants and equipment, net    99,887    95,315  
Deferred income taxes    —    896  
Other non-current assets    13,343    13,570  
           Total assets   $ 286,222   $ 278,195  
   
                                   LIABILITIES  
   
Current liabilities:  
   Accounts payable and accrued expenses   $ 14,888   $ 13,847  
   Accrued payroll and related benefits    7,902    7,307  
   Current portion of long-term debt    990    2,332  
   Accrued taxes    2,781    3,193  
   Current portion of accrued reclamation and closure costs    8,500    7,400  
           Total current liabilities    35,061    34,079  
Long-term debt    1,764    2,341  
Accrued reclamation and closure costs    60,567    63,232  
Other non-current liabilities    6,370    7,114  
           Total liabilities    103,762    106,766  
   
                              SHAREHOLDERS’ EQUITY  
   
Preferred stock, $0.25 par value, authorized 5,000,000 shares; issued  
   2004 - 157,816 shares, issued 2003 - 464,777 shares,  
     liquidation preference 2004 - $10,100 and 2003 - $28,932    39    116  
Common stock, $0.25 par value, authorized 200,000,000 shares;  
   issued 2004 - 118,279,861 shares, issued 2003 - 115,543,695 shares    29,570    28,886  
Capital surplus    505,868    504,858  
Accumulated deficit    (352,632 )  (361,560 )
Accumulated other comprehensive loss    (267 )  (753 )
Less treasury stock, at cost; 2004 and 2003 - 8,274 common shares    (118 )  (118 )
   
           Total shareholders’ equity    182,460    171,429  
   
           Total liabilities and shareholders’ equity   $ 286,222   $ 278,195  

The accompanying notes are an integral part of the consolidated financial statements.


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Part I - Financial Information (Continued)

Hecla Mining Company and Subsidiaries

Consolidated Statements of Operations and Comprehensive Income (Unaudited)
(Dollars and shares in thousands, except for per-share amounts)

Three Months Ended Six Months Ended
June 30, 2004 June 30, 2003 June 30, 2004 June 30, 2003
Sales of products     $ 31,712   $ 30,203   $ 68,362   $ 56,643  
Cost of sales and other direct production costs    15,556    15,335    32,404    29,919  
Depreciation, depletion and amortization    6,085    5,222    12,478    10,124  
     21,641    20,557    44,882    40,043  
Gross profit    10,071    9,646    23,480    16,600  
Other operating expenses:  
   General and administrative    2,319    2,222    4,098    4,261  
   Exploration    3,405    3,035    5,819    4,817  
   Pre-development    728    603    1,024    954  
   Depreciation and amortization    74    171    149    200  
   Other operating expense (income)    (783 )  458    427    (3,370 )
   Provision for closed operations and  
     environmental matters    678    123    1,456    203  
     6,421    6,612    12,973    7,065  
   
Income from operations    3,650    3,034    10,507    9,535  
   
Other income (expense):  
   Interest and other income    379    686    766    964  
   Interest expense    (179 )  (323 )  (377 )  (682 )
     200    363    389    282  
   
Income from operations before income taxes and  
  cumulative effect of change in accounting principle    3,850    3,397    10,896    9,817  
Income tax provision    (1,102 )  (857 )  (1,968 )  (1,616 )
Income from operations before cumulative effect of  
  change in accounting principle    2,748    2,540    8,928    8,201  
Cumulative effect of change in accounting  
  principle, net of income tax    —    —    —    1,072  
   
Net income    2,748    2,540    8,928    9,273  
Preferred stock dividends    (138 )  (659 )  (11,326 )  (1,318 )
   
Income (loss) applicable to common shareholders   $ 2,610   $ 1,881   $ (2,398 ) $ 7,955  
   
Net income   $ 2,748   $ 2,540   $ 8,928   $ 9,273  
Unrealized holding gains on securities    273    149    485    199  
Other    8    9    16    18  
   
Comprehensive income   $ 3,029   $ 2,698   $ 9,429   $ 9,490  
   
Basic and diluted income (loss) per common share:  
   Income from continuing operations after preferred dividends   $ 0.02   $ 0.02   $ (0.02 ) $ 0.06  
   Cumulative effect of change in accounting principle    —    —    —    0.01  
   
Basic and diluted income (loss) per common share   $ 0.02   $ 0.02   $ (0.02 ) $ 0.07  
   
Basic weighted average number of common shares outstanding    118,262    109,427    117,790    109,374  
   
Diluted weighted average number of common shares outstanding    118,698    110,052    117,790   110,173  

The accompanying notes are an integral part of the consolidated financial statements.


-4-


Part I - Financial Information (Continued)

Hecla Mining Company and Subsidiaries

Consolidated Statements of Cash Flows (Unaudited)
(In thousands)

Six Months Ended
June 30, 2004 June 30, 2003
Operating activities:            
   Net income   $ 8,928   $ 9,273  
   Non-cash elements included in net income:  
     Depreciation, depletion and amortization    12,881    10,324  
     Cumulative effect of change in accounting principle    —    (1,072 )
     Gain on disposition of properties, plants and equipment    (82 )  (296 )
     Provision for reclamation and closure costs    891    132  
     Deferred income taxes    1,669    1,350  
   Change in assets and liabilities:  
     Accounts and notes receivable    1,041    (3,010 )
     Inventories    (3,049 )  (408 )
     Other current and non-current assets    (4,271 )  (577 )
     Accounts payable and accrued expenses    1,550    (402 )
     Accrued payroll and related benefits    898    (554 )
     Accrued taxes    (412 )  729  
     Accrued reclamation and closure costs and  
       other non-current liabilities    (3,279 )  (2,499 )
   Net cash provided by operating activities    16,765    12,990  
   
Investing activities:  
   Purchase of held-to-maturity securities    (21,304 )  —  
   Maturities of short-tern investments    11,370    —  
   Additions to properties, plants and equipment    (17,495 )  (6,804 )
   Proceeds from disposition of properties,  
     plants and equipment    93    486  
   Increase in restricted investments    (13,409 )  (27 )
   Other, net    (468 )  78  
Net cash used by investing activities    (41,213 )  (6,267 )