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National carrier Kenya Airways PLC (KQ) seems to be flying out of financial turbulence with the 31.5% reduction in its operating losses announced with the release of its half-year financial results on Wednesday.
KQ recorded a drop in losses for the first half of the year to Ksh 5 billion from Ksh 7.3 billion recorded during a similar period last year.
The Group’s total revenue stood at Kshs 48,104 million, recording a 76% increase compared to the same period last year. The improved performance signifies a course change towards a steady path to recovery.
This increase is mainly attributed to significant growth in passenger revenue which grew by 109%, and cargo revenue which increased by 18%.
During the first half of 2022, operations were positively impacted by pent-up demand and the removal of travel restrictions, resulting in a strong and sustained recovery in trading performance compared to a similar period in the prior year.
KQ uplifted a total of 1.61 million passengers during the period, an 85% improvement compared to the prior year’s 0.87 million passengers.
This, however, remains 33% lower than the pre-pandemic period of 2019. Cargo tonnage increased by 39% compared to the same period in 2021, demonstrating continuous outstanding growth in air freight services.
Kenya Airways Board Chairman Michael Joseph said, “The opening of borders worldwide has led to quick rebounds in some key markets. Lingering travel restrictions in some markets have limited the recovery. It is also important to note that these results were further affected by the high price of aviation fuel which is over 65% more than last year. If we adjusted for the fuel price spike, the operating profit for the period would have been Kshs 1.5B.”
The International Air Transport Association is confident global airline passenger numbers will reach 83% of pre-pandemic figures in 2022, and the aviation industry’s recovery to profitability will be within sight despite ongoing uncertainties.
Strong demand, lifting travel restrictions in most markets, low unemployment in most countries, and expanded personal savings are fuelling a resurgence in demand that will see industry revenues reach USD782 billion, an increase of 54.5% year-on-year and representing 93.3% of 2019 levels.
Kenya Airways Group Managing Director and CEO Allan Kilavuka said, “The industry is experiencing recovery. Our focus is to ensure that we strengthen our operational resilience through innovation and diversification to deliver great and reliable services to our customers.
We have transformed the airline during the pandemic, enabling us to emerge with renewed strength, underpinned by a product, network and service that customers value.”
