Kenya Airways reports a pretax deficit for the first half following a decline in passengers

Kenya Airways (KQNA.NR), opens in a new tab, had a pre-tax loss in the first half after making a profit in the same time period last year. The carrier said on Tuesday that this was because some of its planes were out of service for maintenance and fewer people were flying.

Kenya Airways, one of the three biggest companies in Africa, lost 94.34 million shillings (12.17 billion shillings) in the first half of this year. This is down from a profit of 634 million shillings in the same time last year.

The airline’s first profit before taxes came in the first half of 2024. It had been over ten years since the last one.

Profit for the half-year dropped from 1.3 billion shillings in the first half of 2024 to 6.23 billion shillings. Sales also dropped from 91.5 billion shillings in the first half of 2024 to 74.5 billion shillings.

Its CEO, Allan Kilavuka, told an investor briefing that one of the three planes that had been grounded for repair had started flying again in July.

He said the goal was to have all of the planes ready by the following year.

As a result of its efforts to grow, Kenya Airways ran out of money in 2018 and had to file for bankruptcy.

It was harder to pay back the debt because of the COVID-19 pandemic, which almost stopped all foreign travel, and because the shilling got weaker in 2022 and 2023. Interest rates also went up.

It has relied on state funding. In January, the government paid back a $150 million loan that the airline had gotten from local private banks.

A year earlier, the business had lost 22.86 billion shillings, but by the end of 2024, it had made 5.53 billion shillings before taxes.

A big reason for the better performance in 2024 was foreign exchange gains of 10.55 billion shillings, compared to losses of 15.04 billion shillings in 2023. This was because the local currency rose more than 20% against the dollar that year.