KQ losses reduce by 41% to Ksh23B
Kenya Airways (KQ) has reported an operating profit of Ksh10.5 billion for the year ended December 31, 2023, a turn-around from an operating loss of Ksh5.6 billion in 2022.
However, the carrier reported a loss after tax of Ksh22.7 billion as compared to the Ksh38.3 billion loss reported in 2022.
The growth represents a 287 per cent profit growth for the national carrier, which has been recording losses for over the last 10 years.
KQ's total revenue increased by 53 per cent to close at Ksh178 billion, which has been attributed to a 43 per cent growth in passenger numbers.
KQ also recorded a 37 per cent increase in total operating costs. Direct operating costs increased by 48 per cent while fleet costs were lower by 47.5 per cent due to fleet rationalization.
Overheads increased by 22 per cent due to an increase in employee costs as well as foreign currency losses caused by the devaluation of the Kenya shilling against major world currencies, especially the US dollar.
KQ management
"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," KQ Chairman Michael Joseph 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. 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," KQ Managing Director and CEO, Allan Kilavuka, said.
“The company also exploited opportunities of raising the much-needed revenues by ramping up its scheduled operations as well as through passenger charters. Other initiatives undertaken by the management included partnerships with other airlines and cost containment measures.”
KQ also faced a Ksh19 billion in foreign exchange losses on monetary items, loans, and leases.
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.
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," Kilavuka said.
