Kenya Airways (KQ) shareholders have for another term re-elected Michael Joseph as board chair for another term with a mandate to continue steering the airline’s turnaround approach and fly it out of loss-making.
Joseph who has been maintaining the position since October 2016 was re-elected during the national carrier’s 43rd annual general meeting (KQ AGM) held at Pride Centre in Nairobi where several other board members were picked.
During his first session as board chairman, the then Safaricom CEO oversaw the reduction of the airline’s loss from KShs 25 billion reported in 2015 to an improved position of KShs 7.5 billion loss registered in 2018 according to the national carrier.
“On a year on year comparison of about 12 months, we achieved to reduce our operational loss by ksh 2.263 billion between 2017 and 2018. This, however, does not instantly jump out of our audited results since we changed the reporting periods, thereby making a comparison of nine months in 2017 to 12 months in 2018.
We (KQ) expect this to even out in our next reporting cycle, but more importantly, we are all committed towards delivering sustained stronger results in 2019,” Joseph told shareholders during the AGM on Monday, June 10.
The chairman disclosed KQ had developed a five-year plan built on realistic assumptions towards revenue increase and costs reduction.
“We are working towards effective network planning, including the closure of unprofitable routes, the launch of new prospective connections as well as upgrade or downgrade of equipment used to operate flights.
As a result of these actions, we hope to increase KQ’s passenger numbers significantly and consequently revenue levels,“ he said.
The flag carrier had undertaken various measures to ensure financial and operating efficiency aimed at enhancing business sustainability despite unfavorable market conditions.
Network expansion is amongst the airline’s initiatives to turn around its prosperity and grow its market share.
As of June 2019, Kenya Airways was flying to 53 destinations worldwide.
There was, however, plan to add two more routes in Europe, which would bring the total number of destinations to 55.
“One of our biggest wins in the year 2018 was the growth in our revenue to reach KSh 114.45 billion from KSh 106 billion in 2017. Passenger revenue, which accounts for the lion’s share of Kenya Airways’ revenues, rose to KSh 88.7 billion in the year ended December 31, 2018,” Michael Joseph said.
Joseph added the airline’s fleet ownership expenses and overheads was KShs 114.868 billion against total revenue of KSh 114.185 billion, bringing total operating loss to Ksh 683 million.
This, the KQ chairman said, was a shred of strong evidence the airline could in the near future be able to sustain its services from its own internally generated revenues.
The flag transporter was recently voted as Africa’s leading prime airline, business class for the sixth time in a series and Africa’s leading airline, economy class for the second season in a row according to the World Travel Awards 2019 report.