Kenya Airways revenues in 2019 increased by 12.4 percent to KSh128.32 billion from KSh114.19 billion in 2018. KQ’s chairman Michael Joseph attributes the growth to the improved passenger, cargo, ancillaries, and other revenue streams, mainly due to the expansion of the Kenya Airways network.
Passenger numbers in 2019 hit a record 5.1 million a 6.7 percent increase due to investments in new routes such as Geneva, Rome, and Malindi. KQ recorded a 6.3% growth in cargo tonnage from 64,238 tonnes to 68,264 tonnes in 2019.
Costs: The year under review saw operating expenses rise by 12.4 percent to KSh129.17 billion in 2019 up from KSh114.87 billion in 2018. This saw the firm’s net loss rise to KSh12.98 billion from KSh7.56 billion recorded in 2018.
Michael Joseph says the loss was due to an increase in operating costs associated with a 15 percent increase in capacity deployed to offer increased connectivity between cities and investment in new routes. He further says that the return of two Boeing 787 aircraft that had been subleased to Oman Air led to an increase in the fleet ownership costs.
The airline’s chairman added that the adoption of IFRS 16 lease accounting standard with effect from January 1, 2019 worsened the loss situation.
IFRS 16 requires operating leases which were previously off-balance sheet to be recognized as assets in the balance sheet by determining the value of the right of use. Equally the lease rentals which were previously expensed are now recognized in the balance sheet as liabilities by determining the value of such payments over the life of the lease period.
Michael Joseph – KQ Chairman
The total assets grew to Ksh195.67 billion in 2019 from Ksh136.63 billion in 2018.
