Kenya Airways (KQ) has today reported a triple loss expansion to Sh36.2 billion in the year ended December 31, 2020.
The airline’s chief executive Allan Kilavuka said passenger numbers dropped significantly during the year under review to 1.8 million compared to 5.2 million in 2019.
“The difference between Covid-19 and other crises is that we were completely grounded,” added Kilavuka.
Kenya Airways Chairman Michael Joseph predicts a slow and painful recovery of KQ operations to pre-Covid-19 levels as the company sees a distant rebound in the year 2024 despite the gradual return to flights.
“2020 was the worst year for aviation. We however did well and kept going once the grounding of flights ceased,” he stated.
“It is unfortunate that we do not see a recovery to pre-pandemic levels this year or in the next.”
The loss acceleration from Sh13 billion a year earlier is largely attributable to the collapse of its operations across 2020 on the back of Covid-19 related disruptions.
KQ revenues in the year for instance slumped by 59 per cent to just Sh52.8 billion from a higher Sh128.3 billion in 2019.
This is as passenger revenues sunk by Sh69.9 billion in the period following the grounding of flights between April and August last year.
The total number of passenger carried in the period for instance fell to 1.8 million individuals in contrast to 5.2 million in the preceding year.
Other hits to revenues included Sh864 million in handling services and a Sh5.1 billion wipe out in other revenues.
Kenya Airways nevertheless trimmed its overall costs by about 38.5 per cent to Sh89.4 billion from Sh141.3 billion in 2019 but the cut was not significant enough to offset the dip in revenues.
The cost cuts included Sh22.6 billion in savings from fuel, Ksh.27.4 billion in navigation and landing fees related costs and Sh3.4 billion in employee cost savings from the reduction of salaries and company workforce restructures.
Fleet costs nevertheless surged by Sh3.3 billion lifting impairment costs in the period to Sh7 billion.
Cargo volumes also went down during the period, as the carrier grounded some flights, leading to reduced belly space.
KQ says it has meanwhile received Sh6 billion in support from the National Treasury as of the end of 2020 with the monies being appropriated through the first 2020-21 Supplementary Budget.
Moreover KQ says it has saved an estimated Sh6.6 billion in loan moratoriums by its debt holders.
