Note

11:

Business Segments and Significant Customers

We discover, acquire, develop, produce, and market concentrates and doré containing silver, gold, lead and zinc.

Our products consist of both metal concentrates, which we sell to custom smelters and brokers, and unrefined bullion bars (doré), which

may

be sold as doré or further refined before sale to precious metals traders. We are currently organized and managed in

four

segments, which represent our operating units: the Greens Creek unit, the Lucky Friday unit, the Casa Berardi unit, and the San Sebastian unit. The San Sebastian unit, a historic operating property for Hecla, resumed commercial production in the

fourth

quarter of

2015

and was added as a new reporting segment in

2015.

General corporate activities

not

associated with operating units and their various exploration activities, as well as discontinued operations and idle properties, are presented as “other.”

Interest expense, interest income and income taxes are considered general corporate items, and are

not

allocated to our segments.

Sales of metal concentrates and metal products are made principally to custom smelters, brokers and metals traders. The percentage of sales contributed by each segment is reflected in the following table:

	Year Ended December 31,
	2017			2016			2015
Greens Creek		48.2	%		40.3	%		51.4	%
Lucky Friday		3.8	%		14.7	%		14.9	%
Casa Berardi		33.3	%		27.4	%		33.7	%
San Sebastian		14.8	%		17.6	%		—	%
		100	%		100	%		100	%

The tables below present information about reportable segments as of and for the years ended

December

31,

2017,

2016

and

2015

(in thousands).

	2017			2016			2015
Net sales to unaffiliated customers:
Greens Creek	$	278,297		$	260,446		$	227,833
Lucky Friday		21,555			94,479			66,302
Casa Berardi		192,165			177,143			149,432
San Sebastian		85,758			113,889			—
	$	577,775		$	645,957		$	443,567
Income (loss) from operations:
Greens Creek	$	70,132		$	65,125		$	26,536
Lucky Friday		(16,037	)		18,175			868
Casa Berardi		4,003			16,336			(1,557	)
San Sebastian		53,591			77,221			(9,269	)
Other		(47,046	)		(59,913	)		(52,189	)
	$	64,643		$	116,944		$	(35,611	)
Capital additions (including non-cash additions):
Greens Creek	$	35,255		$	42,013		$	45,962
Lucky Friday		6,268			44,839			60,020
Casa Berardi		51,327			67,577			35,302
San Sebastian		9,994			6,026			4,623
Other		2,908			21,344			14,809
	$	105,752		$	181,799		$	160,716
Depreciation, depletion and amortization:
Greens Creek	$	56,328		$	53,222		$	57,742
Lucky Friday		2,447			11,810			11,262
Casa Berardi		54,594			47,312			43,674
San Sebastian		2,693			3,782			—
	$	116,062		$	116,126		$	112,678
Other significant non-cash items:
Greens Creek	$	2,685		$	2,736		$	2,886
Lucky Friday		2,011			720			72
Casa Berardi		653			1,259			2,229
San Sebastian		468			—			13
Other		51,182			11,135			66,004
	$	56,999		$	15,850		$	71,204
Identifiable assets:
Greens Creek	$	671,960		$	681,303		$	698,265
Lucky Friday		432,400			442,829			393,338
Casa Berardi		804,505			806,044			779,423
San Sebastian		62,198			33,608			22,238
Other		393,894			407,893			328,661
	$	2,364,957		$	2,371,677		$	2,221,925

The following is sales information by geographic area based on the location of smelters and brokers (for concentrate shipments) and the location of parent companies (for doré sales to metals traders) for the years ended

December

31,

2017,

2016

and

2015

(in thousands):

	2017		2016		2015
United States	$	16,776	$	22,499	$	17,862
Canada		358,663		437,621		275,771
Japan		58,475		44,158		38,835
Korea		80,183		116,687		66,293
China		69,631		35,220		38,611
Other		—		4,008		—
Total, excluding gains/losses on forward contracts	$	583,728	$	660,193	$	437,372

Sales of products for

2017

and

2016

include net losses of

$6.0

million and

$14.2

million, respectively, and

2015

included net gains of

$6.2

million, on financially-settled forward contracts for silver, gold, lead and zinc contained in our concentrate sales.

See

Note

for more information.

The following are our long-lived assets by geographic area as of

December

31,

2017

and

2016

(in thousands):

	2017		2016
United States	$	1,246,577	$	1,261,488
Canada		759,700		764,489
Mexico		13,744		6,708
	$	2,020,021	$	2,032,685

Sales from continuing operations to significant metals customers as a percentage of total sales were as follows for the years ended

December

31,

2017,

2016

and

2015:

	Year Ended December 31,
	2017			2016			2015
Teck Metals Ltd.		11.3	%		21.2	%		22.5	%
Korea Zinc		16.4	%		16.9	%		16.0	%
Scotia		24.9	%		24.5	%		5.6	%
CIBC		22.8	%		19.0	%		17.6	%
Mitsui		7.6	%		4.4	%		10.2	%

The sales and income (loss) from operations amounts reported above include results from our Lucky Friday segment.

The Lucky Friday mine is our only operation where some of our employees are subject to a collective bargaining agreement, and the most recent agreement expired on

April 30, 2016.

February 19, 2017,

the unionized employees voted against our contract offer. On

March 13, 2017,

the unionized employees went on strike and have been on strike since that time. Production at Lucky Friday was suspended from the start of the strike until

July 2017,

when limited production resumed. For

2017,

suspension costs

not

related to production of

$17.1

million, along with

$4.2

million in non-cash depreciation expense, are reported in a separate line item on our consolidated statement of operations. In

February 2018,

we reached an agreement for binding

third

-party arbitration with the union, subject to ratification by the union membership. If the arbitration is approved by the union members in

March 2018,

three

arbitrators will decide on

one

of the following to become effective for a period of

three

years:

) the contract we submitted in

December 2017

as our revised last, best and final offer or

) the terms of the collective bargaining agreement that expired in

April 2016,

as modified by certain changes agreed to by the union and us. It is anticipated the arbitration would be completed in

May 2018.

If the arbitration is

not

approved by the union members, we will be back at the status quo. We cannot predict whether the union members will approve the arbitration, the outcome of the arbitration, or how long the strike will last or whether an agreement will be reached if the arbitration is

not

agreed to. As a result of the strike or other related events, operations at Lucky Friday could continue to be disrupted, which could adversely affect our financial condition and results of operations.