Kenya Airways (KQ) concluded a decade with a record Sh38.26 billion full-year loss, plagued by debt and increasing fuel prices. This is the airline’s tenth straight deficit.
The national carrier on Monday shattered its own record for the largest loss from a listed company in the nation, underscoring the scope of the turnaround work ahead.
For the fiscal year that concluded in December 2022, the airline more than doubled its deficit, from Sh15.87 billion to Sh38.26 billion.
In the past ten years, the airline has had four different CEOs as the strategy changed from growing the fleet to shrinking it as the total losses reached Sh172.68 billion despite State bailouts.
The national carrier, which went bankrupt in 2018 after an expansion push left it with billions in debt, is now expected to break even at the end of December and turn a profit by the end of 2019. This is according to the company’s current CEO, Allan Kilavuka.
The airline is encouraged by the growth in its fundamental performance and other measures, including a 68 per cent increase in customer volume to 3.7 million and a 66 per cent increase in revenue from Sh70.22 billion to Sh116.78 billion.
Like Mr Kilavuka, Mr. Joseph is expecting for a miraculous profit next year and maintains that the record loss has plenty of advancement, particularly since it contained a one-time expense of Sh18 billion.
The airline is encouraged by the growth in its fundamental performance and other measures, including a 68 per cent increase in customer volume to 3.7 million and a 66 percent increase in revenue from Sh70.22 billion to Sh116.78 billion.
Like Mr. Kilavuka, Mr. Joseph is expecting for a miraculous profit next year and maintains that the record loss has plenty of advancement, particularly since it contained a one-time expense of Sh18 billion.
“The element that is still outstanding is the restructuring of the balance sheet which needs support from the Kenya government,” said Mr Kilavuka.
The airline owes Sh159.7 billion in long-term liabilities in addition to Sh117 billion in short-term obligations that are due in less than a year. However, it is counting on increased government assistance. Nevertheless, it is counting on increased government assistance.
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KQ’s net loss increased, primarily as a result of the Sh18 billion finance expense that was reflected in the income statement when the government assumed service of the airline’s $525 million (Sh69 billion) dollar-denominated debt after it stopped making payments.
