Prolonged Election Hurts Kenya Airways Earnings

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Carrier records nine-month pre-tax loss of $59m

Kenya Airways says it recorded a nine-month pre-tax loss of 5.97 billion shillings ($59.03 million) as well as an after tax loss of 6.1 billion shillings, caused by the country’s prolonged elections and rising fuel prices.

The company’s nine-month operating profit, however, stood at 1.3 billion shillings, acting Chief Financial Officer, Hellen Mwariri said on Wednesday.

The East African country’s economy  took a downward trend, as it spent most part of last year conducting elections, which coupled with effects of drought, slowed economic growth.

According to the airliner, the protracted elections led to a 20 percent drop in domestic air traffic, including in its East Africa markets.

The airline, which is changing its financial year to match the calendar year, said passenger numbers stood at 3.4 million in the period to end-December.

The airline completed a $2 billion debt restructuring in November as part of revival plans after a drop in Kenyan travel and high financing costs on new Boeing jets resulted in the country’s biggest ever corporate loss – 26 billion shillings – in its 2016 financial year.

Kenya Airways reported pre-tax loss for the full year to end March 2017 of 10.2 billion shillings, while after tax loss was 9.96 billion shillings. Its operating profit also stood at 897 million shillings.

 

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