National carrier Kenya Airways (KQ) has reported a Sh21.7 billion loss for the half year ended June 2023 compared to Sh9.9 billion loss it made in the same period in 2022.
KQ chief executive Allan Kilavuka said that losses were occasioned by debt repayment and the devaluation of the Kenya shillings against major currencies.
However, KQ reported a Sh998 million operating profit in 2023 compared to Sh5 billion which it reported in 2022. The airline's revenue grew to Sh75 billion which accounts for a 56 per cent increase compared to last year.
“The operating improvement was underpinned by a growth in the cabin factor to 76.1%, with an increase in passenger numbers of 43% to 2.3 million,” said KQ in a statement.
“The operating improvement was underpinned by a growth in the cabin factor to 76.1%, with an increase in passenger numbers of 43% to 2.3 million.”
They have attributed the profit to its focus on improving the customer experience, operational excellence, and cash conservation adding that it exploited opportunities to raise revenue through passenger charters and ramped up scheduled operations.
The management also undertook partnerships with other airlines, lease rental renegotiations and other cost-reduction measures which they say helped make the said profit.
KQ Chairman Michael Joseph said, "These exceptional figures underscore the airline's outstanding performance during the period and offer encouraging indications of ongoing recovery and turnaround initiatives that have been put in place by management to return the airline to profitability are bearing fruit."
KQ chief executive Allan Kilavuka said that the results confirm the operational viability of the airline saying it shows signs of recovery.
"We are working to resolve the issue of the legacy debt in collaboration with our stakeholders and the Kenyan government. The debt is worsened by the 14% devaluation of the Kenyan shilling against the dollar since January, which we have had to book as foreign exchange losses,” said Kilavuka.
“The devaluation of the Kenya shilling has a significant negative impact on our financials as a majority of our transactions are carried out in the major foreign currencies. This has, in turn, an impact on our overhead costs, which have increased by 22%.”