Kenya Airways posts record half-year loss
Kenya Airways reports $132 million loss
Kenya Airways had been badly affected by the global COVID-19 pandemic over the past six months with a recorded loss of about US$132 million from flight disruptions that led to the grounding of aircraft.
The airline management said last weekend that the passenger numbers dropped by 55.5% to 1.1 million in contrast with 2.4 million over the same period last year, hurting revenues.
“Operations were severely impacted by the COVID-19 crisis resulting in depressed half-year results,” said Kenya Airways chairman Michael Joseph.
“The network activity from April to June was minimal due to travel restrictions and lockdowns effectively reducing operations to almost nil in connecting our home market to key cities”, he told the Nation Media Group in Nairobi.
The half-year loss is bigger than the annual losses that the airline has been posting for the last three years, he said.
Comparatively, the airline posted a net loss of Kenyan Shillings 12.99 billion ($120 million) last year, up from Kenyan Shillings 7.55 billion ($70 million) in 2018, while the 2017 net loss was Kenyan Shillings 10.21 billion ($94 million) from a record net loss of Kenyan Shilling 26.2 billion ($242 million) in 2016 respectively.
The airline’s Chairman said that there is a bleak outlook on the remainder of the year despite domestic and international flights having been resumed.
“The 2020 results will be significantly negatively impacted because of the projected suppressed air travel demand. We project the demand to remain at less than 50 percent of 2019 for the rest of the year,” he told the Nation Media Group.
Kenya reported its first COVID-19 case on March 13, prompting the government to suspend both domestic and international flights for the entire reporting period.
The airline has been forced to lay off its staff and massive salary cuts to reduce the pressure on its operations.
Several other measures have been taken to rescue the airline, among them were a moratorium on loans, deferred of lease rentals, payment plans with suppliers and also partially deferred staff salaries.
The company has also exploited opportunities for raising revenue through cargo charters and passenger repatriation flights.
Domestic and international flights returned in July and August respectively but KQ’s outlook for the remainder of the year remains depressed.
Rated the leading airline in East Africa and Central Africa with a wide network in Africa, Kenya Airways is as well facing reduced demand in passenger business and increased costs due to tighter health and safety measures taken by the government of Kenya on containing COVID-19 pandemic.