Kenya Airways Sinks Deeper Into The Red With Ksh 12.98 Billion Losses
Kenya Airways sank deeper into the red for the financial year ended December 2019 with 12.98 billion shillings in losses.
The ailing national carrier has been hit hard by the fast-spreading Covid-19 that has led to the canceling of flights around the world.
The results, however, were not affected by the Covid-19 for they cover the period to December 2019 before Covid-19 because intense around the world.
The 12.98 billion shillings loss was informed by an increase in operating costs by 12.4 percent according to KQ Chairman Mr. Michael Joseph.
“The Group saw a 12.4 percent increase in operating costs, driven by the increase in capacity deployed and increase in fleet ownership costs attributed to the return of the two Boeing 787 aircraft that had been subleased to Oman Air,” he said.
Revenue increased by 12.4 percent during the period to 128.38 billion shillings on improved passenger and cargo demand due to route expansion.
During the year under review, KQ opened up new routes in Geneva, Rome, and Malindi leading to an increase in passenger demand by 6.7 percent.
Among the biggest shareholders in Kenya Airways are the National Treasury with 48.9 percent, Kenyan commercial banks with 38.1 percent (the banks converted their loans into equity), and KLM with 7.8 percent. Other shareholders have a 5.2 percent stake.
The current Covid-19 has hit hard on the operations of Kenya Airways. The airline was forced to convert some of its passenger planes into cargo planes to be able to remain afloat during the pandemic.
The cargo business has not been as lucrative as it had been expected by the management and the airline says it is worried about the future.
The management of KQ had applied for relief of 7 billion shillings from the National Treasury but the Treasury refused to say there was no budget for such provision. KQ, while asking for the funds said it was the only lifeline for them to survive.
READ: Irony As GoK Contracts Ethiopian Airlines Instead Of Kenya Airways
About Juma
Juma is an enthusiastic journalist who believes that journalism has power to change the world either negatively or positively depending on how one uses it. (020) 528 0222 or Email: info@sokodirectory.com
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