Wednesday, November 13, 2019
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Kenya Airways reports a 7.5 billion net loss

Kenya Airways has reported a net loss of 7.5 billion in profits as the company announced its 2018 financial year performance.

Speaking from Kenya’s Capital Nairobi, Kenya Airways group chairman Michael Joseph admitted 2018 had been a challenging year for the airline.

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He, however, cited an increase in passenger number something that he attributes to the management and massive support from the board.

Michael Joseph also added that Kenya Airways is not only an airline but also a strategic asset that the country should be proud of.

Also read: Kenya Airways plane fails to take off at JKIA following a bomb scare

The airline will not only increase the country’s GDP but also create employment despite the challenges it’s currently facing.

Kenya aviation losing position

Kenya Airways GMD and CEO Sebastian Mikosz noted that traffic to and from JKIA is the smallest in the continent at 7.2 million.

“Traffic to and from JKIA is the smallest at 7.2 million across the continent. Regional carrier’s network coverage in Africa is broader and our role is to defend our hub and grow it.” GMD & CEO Sebastian Mikosz.” Said KQ CEO

Kenya Airways challenges and mitigation

The national carrier admitted fuel as the there biggest challenge for a while now as fuel prices soar up to 30% representing 40% of their direct operating cost.

To mitigate the above risks, KQ has implemented a hedging policy with minimal risks. Other challenges they are facing include;

  1. Supplier monopoly
  2. High taxes
  3. High competition
  4. HR shortage
  5. Repatriation of funds

Mitigation plans to curb the challenges listed above include;

  1. Sourcing of suppliers
  2. Lobbying for tax reduction
  3. Introduction of project Simba
  4. Introduction of Engineers and pilots training
  5. Lobbying for more funds.

Kenya Airways achievements

Kenya Airways has seen a growth in daily passenger’s numbers, cargo, cabin factor that achieved an average time performance of 79%.

Also read: Kenya Airways Crew arrested in Mumbai with 13Kg of gold bars

In 2017 the airline recorded a daily passenger’s number of 12,484 and in 2018 it recorded a higher number of daily passengers of 13,258.

The airline trips increased from 64,602 in 2017 to 65,684 in 2018, daily cargo uplift increased from 174 in 2017 to 176 in 2018, cabin factor went up from 74% in 2017 to 76 percent in 2018 with an on-time performance recorded as 79% in 2018.

Kenya Airways investment

In terms of investment, the airline opened direct flights to New York City. They admit it to be challenging but it has enabled them to position the airline and Kenya differently.

“New York is symbolic. This route is challenging, but it allows us to position KQ and Kenya differently. We are flying 5 weekly frequencies, we adjusted this to cater to the seasonality of the route. From Jun to Aug, we will fly daily.” GMD & CEO Sebastian Mikosz

Slavian Mwangecho
Slavian Mwangecho
Passionate blogger on a day to day activities happening in Kenya, Africa and around the world. A keen follower of the latest news making headlines around the world

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