Kenya Airways records its first operating profit in nearly seven years

Kenya Airways’ ongoing recovery and turnaround initiatives have resulted in the airline recording an operating profit of Ksh 10.5 billion for the year ended December 31, 2023. This is a 287% growth compared to an operating loss of Ksh 5.6 billion the national carrier recorded the prior year.

The Group’s total revenue increased by 53% to close at Ksh 178 billion.  This is mainly attributable to a 43% growth in passenger numbers against the privious year and to only 2% below the pre-pandemic levels.

Speaking at an investor briefing event on Tuesday, Kenya Airways Chairman, Michael Joseph said, “These figures highlight the airline’s remarkable performance over the year and provide encouraging signs of continued recovery within the air transportation sector. They also confirm the operational viability of the airline business and demonstrate that the management’s ongoing efforts to restore profitability are yielding positive results.”

Kenya Airways Group Managing Director and CEO, Allan Kilavuka, said, during the year, the company’s main focus remained on improving customer experience, operational excellence, and cash conservation. 

‘’These efforts resulted in the airline improving its On-Time Performance (OTP) to a high of 76% from an average low of 58% at the beginning of the year, ranking it as Africa’s second most efficient airline.’’ he said.

‘’Additionally, the introduction of the Asante rewards loyalty program and the revamp of KQ’s website aimed to better appreciate and reward customer loyalty while improving user-friendliness and functionality.” he added. 

Despite facing a Ksh 19 billion in foreign exchange losses on monetary items, loans, and leases, this year’s performance marked a major milestone in the Group’s turnaround strategy. The company managed to achieve a notable improvement, with a loss before tax of Ksh 22.7 billion, marking a significant stride from the Ksh 38.3 billion loss reported in the previous financial year of 2022.

Mr. Kilavuka emphasized that the airline’s top priority going forward, is to continue building on the gains made in the airline’s turnaround strategy, Project Kifaru. Along with this, in the near term, he said the focus is on completing the capital restructuring plan whose main objectives are to reduce the Company’s financial leverage and increase liquidity to ensure the company can operate at normalized levels. 

“Our primary focus going ahead is dedicating ourselves to fostering innovation, nurturing partnerships, and cultivating a culture of excellence to ensure that Kenya Airways soars to new heights of success. Additionally, we will continue to engage government on recapitalizing the business to place Kenya Airways on a stronger footing and provide a stable base for long-term growth,” said Mr Kilavuka.

The Government of Kenya in its capacity as a major investor in Kenya Airways has indicated their continued strong support for the Company’s operational and capital structure optimization process and are closely involved throughout the transaction process and intend to remain major stakeholders in the Company over the long term. 

The International Air Transport Association (IATA) predicts a full recovery of the aviation industry from the Covid-19 crisis in 2024. This projected growth signifies a substantial rebound and resurgence for airlines, reflecting a renewed vigor and vitality within the industry.

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