Still flying low: KQ announces 26.2B record loss after tax

Passenger numbers however rose by five per cent in 2015

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Mbuvi Ngunze
KQ CEO Mbuvi Ngunze. The airline continues to make losses even as passenger numbers increase. PHOTO: WAZA

Kenya Airways isn’t out of the woods yet following the announcement that it has posted a post-tax record loss of Sh26.2 billion for the year that ended March 31, up from Sh25.7 previously.

The national carrier’s foreign exchange loss ballooned to 703.3 per cent thanks to a stronger dollar, to Sh10.8 billion, the star reports.

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CEO Mbuvi Ngunze however said on Thursday, July 21, that the airline broke even if you exclude one-offs”.

“Without fluctuation of the exchange rate we would have reduced the loss to Sh16 billion compared to the Sh26 billion we have reported,” he said.

Ngunze told stakeholders during the announcement that the airline was growing despite the tough times it continues to experience.

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Kenya Airways, according to reports, had a Sh5 billion fuel burn-off benefit after selling off its Boeing 737-300.

Passenger numbers also rose by five per cent in 2015 from 4.17 million the previous year to 4.23 million.

Acting finance director Dick Murianki said: “We had borrowed short term loans at expensive rates. Our financing costs went up 53.7 per cent.”

KQ had announced in November 2015 a turnaround strategy whose goal is to have the national carrier bounce back to profitability. It proposed a 24-point plan with viable ways to reverse the financial fortunes.

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Out of a total 460 planned initiatives, 134 have since been implemented.

The loss-making airline started plans to retrench 600 workers in May, four years after it fired 400 staff in a similar exercise. 80 staff were sent home on July 8, 2016 during the first phase of the sackings.

The move, KQ reckons, will help it reduce costs amid efforts for the turnaround.

Via the Star