Kenya’s flag airline carrier, Kenya Airways just released its financial results for the year ending 31st December 2017. Kenya Airways continued its financial turnaround despite rising fuel costs, a costly restructuring and a prolonged political crisis in Kenya.
The Chairmen of the board, Micheal Joseph noted that the Airline had improved a great deal form the previous year’s performance. Apart from the rise in fuel costs and the financial cost of restructuring, the airline did very well. The airlines restructuring involved the conversion of debt into equity making the government the largest shareholder of the airline. There are also a couple of banks that ended up with plenty of shares.
For the purpose of the report, the Directors decided to change the year end from 31st March to 31st December 2017. The financial statements, therefore, covered 9 months from 1st April to 31st December 2017. The highlights of the report included the improved operating profit of Ksh. 1,306 billion compared to the previous years Ksh. 897 million.
- Their fleet costs for that 9 month period were at 10,556 million compared to the previous year’s 15,524 million.
- The overhead costs recorded a significant drop recording 15,537 million. This is in contrast to the 24,500 million recorded the previous year.
- The airlines direct operating costs also went down hitting 6.72 billion.
- The cash flows generated from operations were at 11.8 billion resulting in a cash positive of 6. 356 billion.
- The company also invested 2.197 billion.
For their operating figures:
- Passenger numbers stood at 3.43 million which were down from the previous year which recorded 4.46 million passengers.
- The yield per revenue passenger kilometre declined by 6.5% compared to the previous year
- The cabin factor grew from 2016’s 72.3% to read 76.2% for the year ending 31st December 2017.
- Fuel price went up at 62 dollars per barrel which in turn increased the airlines operating costs.
The CEO of the airline, Sebastian Mikosz noted that even though the company had a long way to go, it had come very far based on the year’s results. The chairman also echoed those sentiments saying that even though the company had a long way to go, the investors and passengers should remain confident in the company.
There are plans to ensure that the airline dominates the regional market both locally and in Eastern Africa. When it comes to airports, Nairobi and Mombasa hold the largest airports in Kenya. However, the company will not be creating a hub in Mombasa for now. For now, the airline is closely looking into what they can do with the market in Mombasa so they can enhance the regional network.
Kenya Airways is looking forward to increased revenues once they start their direct flights to the US – Travel: Kenya Airways Direct Flights To The US Will Boost Tourism And Create New Jobs