Kenya Airways 737-700. By Rob Finlayson

Kenya Airways (KQ) posted a net profit of KES2.03 billion ($211 million) for its fiscal year first-half ended Sept. 30, up 41.6% from KES1.4 billion in the year-ago period. It noted the improved profitability was realized despite the challenging economic and geopolitical environment and said it is “optimistic” its performance will continue to improve in the second half.

Fiscal first-half revenue rose 33.3% year-over-year to KES54.9 billion but direct operating costs rose by 52.5% to KES39.5 billion, mainly due to an increase in operations and high fuel expenses. Fuel costs, excluding hedge costs, increased year-on-year 89.7% to KES21.2 billion. Consequently, six-month operating profit sank 57.2% to KES1.02 billion.

KQ’s fiscal first-half traffic, in terms of RPKs, heightened 17.9% on a 13.2% increase in ASKs, largely as a result of increased frequencies and the launch of two new destinations—Ouagadougou and N’Djamena. 

The carrier took delivery of three new Embraer 190s and returned one Boeing 767-300 to its lessor in the reporting period (ATW Daily News, Sept. 14). This resulted in a net increase of three aircraft to 33 units, including four 777-200s, five 767-300s, five 737-800s, four -700s, six -300s, four E-190s and five E-170s.

Passenger yields, including fuel surcharges in US cents, increased by 0.9% and strengthened to 12.6% when translated into Kenya shillings, KQ said. It did not provide actual yield or RASK.

The Nairobi-based airline—in which Air France KLM Group holds a 26% stake and the Kenyan government holds 23%—intends to raise capital via a rights issue within the next six months to finance its 10-year expansion plan through FY2020-21. The plan includes “new destinations roll out covering the six continents and a fleet acquisition plan,” KQ said.