By George Obulutsa
NAIROBI (Reuters) -Kenya Airways aims to finalise plans to raise at least $500 million in extra capital to expand and improve its fleet by the first quarter of next year, the airline said on Tuesday, after it reported a pretax loss in the first half.
One of Africa’s three biggest airlines, Kenya Airways posted a loss of 12.17 billion shillings ($94.34 million) in the first half of this year, compared with a profit of 634 million shillings in the same period last year.
The airline attributed the loss to a drop in revenue and passenger numbers caused by three of its planes – Boeing 787-8 Dreamliners – being out of commission for maintenance.
CEO Allan Kilavuka told an investor briefing that one of the planes had resumed services in July, and said the airline was working to have a full fleet available by next year.
He said the airline planned to identify the source of the additional capital and get shareholders’ approval within the first three months of next year.
“We’ve said the minimum that we are gunning for is about half a billion dollars, which we believe (is) a minimum. That will address the fleet expansions that we’re looking (for),” he said.
The pretax profit that the airline posted in the first half of 2024 was the first it had made in over a decade.
Tuesday’s report showed operating loss for the half-year was 6.2 billion shillings, down from a 1.3 billion shilling profit in first half 2024, while revenue fell to 74.5 billion shillings from 91.5 billion shillings during the same period last year.
Kenya Airways went into insolvency in 2018 after an expansion drive left it with debts reaching hundreds of millions of dollars.
It has relied on state financial support, with the government paying off a loan of $150 million in January that the airline had received from local commercial banks.
The company ended 2024 with a full-year pretax profit of 5.53 billion shillings, compared with a loss of 22.86 billion shillings the year before.
A big driver of 2024 performance was foreign-exchange gains of 10.55 billion shillings, versus a loss of 15.04 billion shillings in 2023, as the local currency strengthened more than 20% against the dollar that year.
($1 = 129.0000 Kenyan shillings)
(Reporting by George ObulutsaEditing by Bernadette Baum, Barbara Lewis and Helen Popper)
