Kenya Airways The company said it was able to reduce its annual net loss by implementing various cost containment measures.
Recall that the COVID-19 pandemic had taken a serious toll on the African aviation industry, resulting in a collective loss of $10.21 billion in 2020 and $8.6 billion in 2021, respectively.
However, Kenya Airways’ financial troubles pre-dates the pandemic as the company last reported a profit in 2012.
Kenya Airways reported a net loss of $130.5 million (Sh15.8 billion) for the financial year ended December 31st, 2021.
Business Insider Africa understands that this indicates a 56.58% decrease when compared to the net loss of $313.2 million (Sh36.2 billion) which the airline reported during the comparable period in 2020.
The company explained that it was able to reduce its annual net loss by implementing various cost containment measures, whilst preserving and diversifying its revenue. Specifically, operating expenses were cut by 3.62%.
While speaking during a recently-held investor earnings call, the company’s Board Chairman, Michael Joseph, gave further insight into the restructuring efforts that aided the reduction in losses.
"2021 was challenging for the aviation industry. Just when travel restrictions were easing up and recovery was looking good, the Omicron Variant disrupted upward growth. We continued with our efforts to improve our flexibility and service offering to customers. The restructuring and transformation initiatives made during the year 2020 lockdown contributed immensely to the recovery during the second half of the financial year 2021," the Chairman said.
He stressed that improvement would have been better if the Omicron Variant of the Coronavirus pandemic hadn’t hampered recovery efforts.
Recall that the pandemic had taken a serious toll on the global aviation industry. While the negative impact led to African airlines losing a collective $10.21 billion in 2020, losses declined slightly to $8.6 billion in 2021.
And as Business Insider Africa earlier reported, the African Airlines Association (Afraa) has estimated that African airlines could lose an additional $4.9 billion in 2022.Do note, however, that Kenya Airways’ financial troubles pre-dates that pandemic. As a matter of fact, the last time the company reported a profit was in 2012. Since then, it has reported losses for nine consecutive years.Earlier this year, the Kenyan Government disclosed that it had made provisions to bailout the heavily national carrier with sum of $176 million.