Kenya Airways 2024: The Plan, The Profit, and the Road to Recapitalization

In an exclusive interview with The Kenyan Wall Street, Kenya Airways (KQ) acting CFO Mary Mwenga outlines the airline’s internal transformation—from cultural shifts to balance sheet overhauls—and what it will take to make its 2024 turnaround sustainable.

---

Kenya Airways (KQ), the national carrier, is staging a powerful financial recovery after years of turbulence. Having posted a net profit of KSh 5.4 billion in 2024—its first since 2012—the airline staged a comeback it hopes marks the beginning of a new era of operational and financial resilience.

This remarkable turnaround stems from diversified revenue through cargo and ancillary businesses, aggressive cost containment, strategic debt restructuring, and the disciplined execution of Project Kifaru.

Crucially, this story goes beyond the numbers.

The Turbulence Before Takeoff (2018–2022)

KQ reported total net cumulative losses of more than KSh 110.8 billion from 2018 to 2022. Rising operating costs, unstable foreign exchange, and little space for strategic maneuver—particularly during the COVID-19 disruption—were the major contributors of these losses.

For example, the airline reported KSh 128.3 billion in revenue in 2019, but it still ended the year with a KSh 12.9 billion net loss. Its structural inefficiencies were revealed by the discrepancy between revenue and cost containment.

When COVID-19 grounded international aviation in 2020, the situation worsened. The carrier reported a KSh 36.2 billion loss after its revenue fell by more than 50%. High finance costs and suppressed operations worsened the decline.

The airline was still losing money, hampered by interest payments and foreign exchange losses, even though there was some improvement in 2021 and 2022. Progress was still

“This wasn’t just a revenue problem—it was structural. Our cost base was heavy, and every external shock made it worse,”

CFO Mary Mwenga says.

Year	Revenue (KSh B)	Total Operating Costs (KSh B)	Operating Profit (KSh B)	Finance Costs (KSh B)	Net Profit/Loss (KSh B)
2018	114.2	113.5	-0.7	7.55	-7.5
2019	128.3	130.0	-1.7	10.9	-12.9
2020	52.8	79.9	-27.1	9.1	-36.2
2021	70.2	84.7	-6.8	9.3	-15.9
2022	117.0	140.8	-5.5	18.1	-38.3

---

FY2024: Kenya Airways Turnaround 2024 – Signs of Sustainable Profitability

Project Kifaru, which was started in 2021, was divided into three stages: growth, recovery, and stabilization. KQ converted aircraft to cargo use, optimized contracts, and enforced stringent cost control reversing years of poor performance.

The airline also launched new destinations—Mogadishu and Maputo—and increased route frequencies to key cities such as New York, Paris, as well as various local and African destinations, and decreased staffing inefficiencies in 2023. Financial discipline was enhanced by these operational gains.

“Cargo, engineering, ground handling—they all became core revenue lines. We’re no longer a passenger-only airline,” says Mwenga. “With Project Kifaru, we brought structure to the turnaround. Every initiative—from cost control to growth—was deliberate, and it’s what gave us this momentum.”

Mary Mwenga, Acting CFO of Kenya Airways

---

FY2024 Turnaround: Signs of Sustainable Profitability

Metric	2023	2024	Change
Revenue	178.5	188.5	+6%
Operating Profit	10.5	16.6	+58%
Net Profit	-22.7	5.4	Turnaround

Ultimately, Kenya Airways’ 2024 profit was powered by a sharp rise in cargo revenues, improved operating efficiency, and a steep drop in forex-related losses. The airline’s structural reforms under Project Kifaru matured into measurable gains, cementing discipline across all business units.

“In the past, even small wins would get wiped out by inefficiencies. This time, the structure held. Kifaru helped us embed discipline at every level—from procurement to revenue.”

Mary Mwenga.

The airline posted a 6% rise in total revenue to KSh 188.5 billion, with cargo volumes growing by 25%, contributing 19% of the year’s revenue uplift. With two freighters now active, cargo is no longer a support function—it’s a growth driver.

“We’re seeing real momentum in cargo. With two freighters now operational, cargo has become a reliable growth engine alongside our core passenger services,” Mwenga added during the interview.

This profit is more than a rebound—it’s a structural turning point. It signals that Kenya Airways is no longer relying on temporary recoveries but has re-engineered its fundamentals for sustainable growth.

Balance Sheet: From Fragility to Rebuilding

Kenya Airways last recorded positive shareholder equity in 2014, at KSh 28.2 billion. Since then, years of operating losses, high debt-servicing costs, and foreign exchange volatility steadily eroded its capital position. By 2023, equity had dropped to -KSh 138.1 billion, before slightly improving to -KSh 118.2 billion in 2024.

The table below illustrates the equity slide and its contributing factors:

Year	Forex Impact	Interest Expense	Accumulated Loss	Equity Position
2018	-6.6	7.55	(60.7)	-14.4
2019	-8.1	10.9	(80.2)	-16.1
2020	-13.0	9.1	(128.8)	-64.2
2021	-9.3	9.3	(147.9)	-83.2
2022	-18.0	18.1	(172.7)	-108.0
2023	-19.0	20.6	(195.3)	-138.1
2024	+1.2	16.9	(189.7)	-118.2

To stabilize the balance sheet, KQ converted 85% of its foreign currency debt into shilling-denominated loans in 2023. The move drastically reduced forex losses and brought some relief to the equity position.

“We’re significantly undercapitalized—our equity is still negative KSh 118 billion. That’s not sustainable,” Mwenga says.
“The final phase of Project Kifaru is all about fixing this. We’re working closely with the government and a financial advisor to bring in a strategic investor who can inject fresh capital, not just to stabilize our books, but to reposition the airline for long-term growth. Recapitalization is the only viable solution.”

KQ expects to complete the strategic investment process by the end of 2025. The success of this final phase will determine whether the airline can regain positive equity for the first time since 2014—and rebuild the financial resilience needed to scale.

Recapitalization Strategy: The Final Frontier of Project Kifaru

Despite posting a KSh 5.4 billion profit in 2024, Kenya Airways remains deeply undercapitalized, with negative equity of KSh 118.2 billion. The airline’s ability to generate sustainable value now hinges on one final and critical mission under Project Kifaru: recapitalizing the business.

To restore a healthy capital structure, the airline is pursuing a two-pillar strategy:

1. Government Debt-to-Equity Conversion

The Kenyan government, which currently holds a 49% stake in KQ, has been instrumental in supporting the airline—mainly through debt novation during the past two years. To prepare the ground for a new investor and preserve ownership balance, KQ and the National Treasury are working on a plan to convert part of that government debt into equity.

“Because the government already owns 49%, bringing in a new investor means we must balance the cap table. That’s why a portion of the novated debt must convert into equity,” explains CFO Mary Mwenga.
“These are the trade-offs our financial advisor is helping us model.”

2. Strategic Investor Search

Having completed a technical review of the business in 2023, Kenya Airways is now working with a financial advisor to lead global roadshows. The objective is to attract a strategic investor who brings capital—but also offers market access, operational synergy, and governance discipline.

“We’re not just looking for money. We want a partner who adds value—capital, networks, strategy. The final leg of Project Kifaru is all about that long-term fit,” Mwenga explains.

This strategic investor will inject fresh capital to stabilize the balance sheet, improve working capital, and prepare the airline for scalable growth in the next five years.

---

What This Means for Shareholders

For long-suffering shareholders, this phase carries meaningful promise. With shares still suspended from trading and no dividends paid in over a decade, the return to profitability now opens the door to meaningful recovery—but only once the capital structure is fixed.

“We’re very grateful to our shareholders who have stayed with us, even without returns,” Mwenga acknowledged during the post-earnings interview.
“Once we recapitalize and move from negative to positive equity, there’s no reason we shouldn’t start paying dividends again. That’s our commitment.”

After the successful turnaround in 2024, Kenya Airways aims to complete the recapitalization process by the end of 2025, depending on regulatory coordination and investor due diligence.

---