Kenya Airways (KQ) has posted a Ksh8.5 billion loss in its 2019 half year earnings, which it attributes to both operational costs and elevated impairment losses.
This is approximately Ksh. 4.6 billion more than the loss it incurred in a similar period last year which stood at Ksh. 3.992 billion which translates to a 112 percent increase in losses.
The airline’s operating costs rose to Ksh61.45 billion, from Ksh53.22 billion in the same period last year partly due to two Boeing 787 planes that had been sub-leased to Oman Air being returned during the first half of the year
According to a news report by the Business Daily, Kenya Airways had prior to the half-year report pushed for increased network and route expansion including the launch of new destinations to Geneva, Rome, New York and Mogadishu.
“In turning around Kenya Airways, a deliberate decision was taken not to shrink the airline but instead improve financial performance through strategic investments on growth opportunities,” said Board Chairman Michael Joseph as quoted by the Business Daily.
He added that some of the investments might deny KQ and its shareholders immediate returns but are expected to yield positive results in the future.
Mr. Joseph added, according to the Business Daily, that in order for the airline to compete on a level playing field, they have to bring their costs down and gain the benefit of operating in an integrated way.
The airline is also in the process of recruiting a new CEO after Sebastian Mikosz’ surprise move to end his contract by the end of the year.