US-based precious metals miner Hecla has reported a 7% decrease in second-quarter silver production, but it still managed to exceed production expectations, boosting the company’s cash position to its second-highest in six years.

Silver production decreased from 2.81-million ounces in the June quarter of 2017 to 2.60-million ounces in the quarter under review, while gold production increased by 14% year-on-year to 60 313 oz. Lead output increased by 25% to 5 522 t and zinc production increased by 10% to 14 299 t.

The better-than-expected production has boosted Hecla’s cash position to $245-million by June 30, 2018, about $43-million more than a year earlier.

The cash will be used for the acquisition of Nevada-focused Klondex Mines in the third quarter, Hecla president and CEO Phillips Baker said in a statement on Thursday.

Klondex shareholders on Thursday also approved the plan of arrangement between the companies. The deal, announced in March, will see Hecla buy TSX-listed Klondex for $462-million, gaining its Fire Creek, the Midas and the Hollister mines. The takeover target’s Canadian assets in Manitoba will be spun out to existing shareholders.

The new Nevada assets will add to Hecla’s operating mines in Alaska, Idaho, Mexico and Canada.

Hecla reported that the transaction is expected to close on July 20.

During the second quarter, the Greens Creek mine in south-east Alaska produced two-million ounces of silver and 13 720 oz of gold. This was higher than the second quarter of 2017, owing to higher ore grades as a result of mine sequencing.

The Lucky Friday mine, in northern Idaho, where a strike has been ongoing since March last year, produced 24 686 oz of silver in the June quarter. There was no production in the second quarter of 2017, as limited production performed by salaried staff during the ongoing strike started in July 2017.

Hecla produced 42 721 oz of gold at Casa Berardi, in Quebec. The mine produced as expected, with an increase of 9 460 oz of gold, compared with the second quarter of 2017.

The San Sebastien mine produced 600 000 oz of silver and 3 872 oz of gold. The silver and gold production were lower than a year earlier, but both still exceeded the company’s estimates.