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February 21, 2024
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Despite the devastating effects of COVID-19 resulting in depressing half-year results, Kenya Airways recorded improved performance to the same period last year. The disclosure was made on August 26 when the carrier released its financial results.

The Group’s total revenue during the period was reduced by 9% to Kshs. 27,354 million. The reduction is due to the cessation of domestic scheduled operations in April 2021, as well as travel restrictions, and lockdowns due to a surge in virus cases in key domestic and international markets including the UK, India, China, UAE, and the US.

Prior to the pandemic, the carrier flew to over 40 African destinations. Currently, the airline operates in 40 international destinations and two domestic routes with significantly reduced frequencies of approximately 65%  compared to 2019. COVID-19 restrictions on travel by various states remain the biggest challenge.

Two percent of Africans vaccinated

In addition, the rollout of coronavirus vaccines in Africa remains low; with less than two percent of Africans having received the vaccine while in other regions high vaccination levels have allowed the progressive reopening of their economies.

The current upsurge, coupled with the continent’s low vaccination rates, has contributed to low passenger traffic from Africa to markets like Europe who have issued or extended travel restrictions on travelers from Africa in a measure to prevent the spread of the new COVID-19 variants. As a result, a total of 0.8 million passengers were uplifted during the first half of 2021, a 20% decline in comparison to a similar period last year. 

Though passenger revenue declined by 17% to Kshs. 20,230 million, cargo revenues rose by 60% due to strong freighter operations.  The Group has been able to uplift an increased 500 tonnes monthly, showing its cargo division’s outstanding agility in adapting its operations to provide air freight services in this new environment.

Exploiting opportunities

Kenya Airways Board Chairman Michael Joseph says, “During the period, the company’s main focus was, and still is cash conservation. The company has exploited opportunities of raising much-needed revenue through passenger charters and ramped up cargo operations. Other initiatives undertaken by management include partnerships with other airlines, lease rentals re-negotiations, payment plans with suppliers, and partial deferment of staff salaries.”

According to IATA, 1Q21 results show that the start of the year was still very weak for the airline industry, as virus outbreaks paused air travel recovery in many important markets. Faced with long recovery prospects, diminishing revenue occasioned by reduced demand in the passenger business, and increased costs due to tighter health and safety measures, the business focus for the rest of 2021 will be ensuring the survival and the rebound of the company.

Kenya Airways Group Managing Director and CEO, Allan Kilavuka said, “Notwithstanding the current global crisis brought about by the COVID-19 pandemic, we will continue to adopt an agile approach in responding to the current dynamic marketplace. Our focus is on business recovery and to continue contributing to the rebuilding of economies and communities impacted by the pandemic. Restoring customer confidence for business and leisure travel will be key to growing demand, as well as creating agile and nimble business models that are sustainable and responsive to the customer’s needs.”

Kilavuku recently said that the Kenyan government is facilitating plans to nationalize the carrier. 

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Co-Founder AirInsight. My previous life includes stints at Shell South Africa, CIC Research, and PA Consulting. Got bitten by the aviation bug and ended up an Avgeek. Then the data bug got me, making me a curious Avgeek seeking data-driven logic. Also, I appreciate conversations with smart people from whom I learn so much. Summary: I am very fortunate to work with and converse with great people.

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