Listed carrier Kenya Airways (KQ) has posted a net profit of KSh 5.4 billion for 2024, up from a KSh 22.68 billion loss in 2023, breaking a decade-long spell of losses.
- •The turnaround was driven by a significant gain of KSh 10.6 billion from foreign currency exchange on borrowings and leases as the shilling strengthened against the dollar last year.
- •The 124% profit improvement was also driven by a 4% increase in passenger numbers and a 25% boost in cargo tonnage.
- •The airline also expanded its capacity by 10%, translating to 16.23 billion Available Seat Kilometers (ASKs), while maintaining a cabin factor of 75.2%, and reduced its overall costs.
“These results are remarkable because they mark the highest number of passengers that the airline has ever uplifted, the highest turnover, and the highest profit attained in the history of the airline,” KQ said in a statement.
Kenya Airways’ turnaround comes as the global aviation industry grapples with aircraft and engine shortages, exacerbated by a constrained supply of spare parts. The airline warned that such challenges could temper future expansion but maintained confidence in its recovery strategy.
The airline noted that Project Kifaru—its turnaround strategy—will double down on its efforts to streamline operational excellence, customer obsession, innovation, and discipline. The utilization of these strategies last year saw the airline’s total revenue climb to KSh 188 billion.
Total comprehensive income for the year stood at KSh 19.8 billion, a sharp recovery from the KSh 28.0 billion loss posted in 2023. The results reflect the airline’s strategic efforts to stabilize its financial performance amid persistent challenges. KQ cut its total costs by 9% year-over-year, primarily attributed to savings on overheads and lower net finance costs.
The airline reported a decline in net cash generated from operating activities to KSh 17.7 billion last year down from KSh 24.5 billion in 2023—due to high interest payments, which stood at KSh 3.1 billion. Despite generating positive cash flow from operations, the airline faced substantial outflows from investing activities, primarily due to the purchase of property and equipment totaling KSh 7.1 billion.
Net cash used in financing activities narrowed to KSh 12.0 billion from KSh 18.2 billion in 2023, largely driven by the repayment of lease liabilities amounting to KSh 14.5 billion and borrowings of KSh 7.5 billion. As a result, the airline’s cash and cash equivalents at the end of the year stood at KSh 5.8 billion, down from KSh 7.8 billion at the start of the period.
Part of the airline’s strategy is to stabilize its financial health by completing the capital restructuring initiative that it has been forced to implement after a series of state bailouts. A huge chunk of the debt it owes several lenders was transmuted into equity.
KQ’s resumption to profit territory is likely to boost its stock market performance. When the airline’s suspension from the Nairobi Securities Exchange (NSE) ended in January this year, its stock price began to soar due to optimism based on its Half-Year performance last year.
