The Kenya Airways has projected a loss in the 2023/24 financial year. By the end of the year, the loss will be at 32 Billion and 62.5 Billion by the end of the financial year.
Speaking to the Transport Committee at the national assembly, KQ CEO, Allan Kilavuka said that the airline is faced with loan challenges and the weak shilling against the dollar isn’t doing any good.
“Our biggest problem at Kenya Airways is that we have huge debts that are denominated in US dollars. Therefore any depreciation of the Kenya shilling against the dollar is quite significant in our books.”
This has affected the loan payments and the normal operations of the company. Indicating a possible request for the government to chip in and help out. Although the CEO also confirmed that the company still owes the government. This he said are loans incurred through advances or loans paid by the government on behalf of KQ.
“A weakening Kenya shilling significantly increases the airline’s financing and operating costs. I am 95% confident that we will turn around the institution but this is only possible if we deal with the debt that we have. If we don’t deal with it, this plan will not work.”
He insisted on negative forwx being a result of these recent losses. And dealing with debts will be a starting point for turning the airline around. This will lift off weight from their shoulders and ensure smooth operations.
In order to increase revenue, the CEO said that the airline will be launching new destinations. This includes China, North America, Turkey, India and Europe in the next five years.
This will not be the first time that the Kenyan Government has come to rescue KQ. Everytime the company has run into debts and paralysed operations before the government steps in. Question remains as to when will KQ start making profits.