Kenya Airways Swings Back to Loss as Grounded Jets Squeeze Capacity

Kenya Airways swung to a first-half operating loss of Ksh12.5 billion after a shortage of spare parts forced it to ground a third of its wide-body fleet, reversing gains made last year when it posted its first profit in more than a decade.

Revenue in the six months to June fell 19 percent to Ksh75 billion, hit by a 14 percent drop in passenger numbers and a 16 percent reduction in available seat capacity during the peak travel season, the airline said on Tuesday.

The grounding of three Boeing 787-8 Dreamliner aircraft due to global supply chain disruptions left the carrier short of capacity, with available seat kilometres dropping to 6.7 billion from 8.0 billion a year earlier.

The performance marks a setback for the Nairobi-based airline, which returned to profitability in 2024 after years of state bailouts and restructuring.

The carrier reported an operating profit of Ksh1.3 billion in the same period last year and a net profit of Ksh513 million.

Operating costs dropped 10 percent thanks to scaled-back operations, but fleet ownership expenses climbed 29 percent due to revaluation of leased assets and the addition of a new Boeing 737.

Chief Executive Allan Kilavuka said the airline had taken “decisive actions to stabilise operations,” pointing to the return of one of the grounded Dreamliners in July, with the remaining two expected to resume service later in the year.

“Passenger demand for international routes remains robust, underscoring the strength of our brand and the critical role Kenya Airways plays in connecting Africa to the world,” Kilavuka said.

The carrier is also pursuing a capital raising plan to strengthen its balance sheet, reduce leverage and bolster liquidity.

The International Air Transport Association projects global passenger traffic will expand 5.8 percent in 2025, though cargo demand is expected to slow to 0.7 percent

Kenya Airways, 48.9 percent owned by the Kenyan government and 7.8 percent free by Air France-KLM, said its focus remains on restoring fleet capacity, cutting costs and driving sustainable growth.

gandae@businessdayafrica.org