COEUR d'ALENE - Hecla Mining Co. on Wednesday reported a net loss of $3 million in the fourth quarter.

The Coeur d'Alene-based mining company was in the black for the year-earlier quarter, recording net income of $605,000.

For the 12 months ending Dec. 31, Hecla reported a net loss of $25.7 million, compared with a net gain of $14.4 million for 2012.

Silver prices in the fourth quarter and full year were $20.13 and $21.28 per ounce, which was 31 percent and 34 percent lower, respectively, than in the prior periods.

"Gold prices were down as well," Mike Westerlund, vice president - investor relations, told The Press Wednesday.

He said the company measures its business by operating cash flow, which reached $21.6 million in the fourth quarter. That was only $5 million less than what was generated for the full year.

In the fourth quarter, the company had a significant increase in production and a reduction in operating costs at the Lucky Friday silver mine, near Mullan, and Casa Berardi gold mine in western Quebec, Canada, Westerlund said.

"We've significantly increased our gold and silver reserves," he said. Gold reserves are up 190 percent to 2.1 million ounces compared with Dec. 31, 2012, primarily due to the acquisition of Casa Berardi.

Lucky Friday returned to full production levels in September.

With Greens Creek mine in Alaska continuing strong silver production at low costs, Hecla is in its best position in history, said Phillips S. Baker Jr., Hecla's president and CEO.

"With all three properties now at expected production, we should have about 17 million ounces of primary silver equivalent production in 2014," Baker said in a statement.

Silver production for 2013 reached 8.9 million ounces, which was a 39 percent increase from 2012. Gold production was 119,989 ounces, of which 62,532 ounces were produced at Casa Berardi.

"We are on a path where by 2017 we could have the most silver equivalent production with the largest reserve base in our 122-year existence," Baker said.

With low operating costs allowing capital expenditures to be paid largely out of cash flow, Hecla should be able to weather even lower metals prices, Baker said.

With the increased production, the company expects to "reap increased rewards when prices go higher," he said.

Hecla, the third-largest producer of zinc and lead, is encouraged by the improving outlook for both metals, Baker said.