KENYA AIRWAYS SET TO ANNOUNCE HALF YEAR RESULTS LATER TODAY
(Posted 13th November 2013)
Kenya Airways’ shares, trading at 10.50 level only recently, have made a strong showing by closing up at 13.45 Kenya Shillings on Tuesday, the highest the shares were traded in a year. This happened the day prior to the airline’s management making available the half year results, covering the period of April 01st to September 30th, which is due later this morning in Nairobi.
Last year did Kenya Airways launch a share rights issue, which while not fully subscribed nevertheless reached the minimum expectations, with a share going at 12.50 Kenya Shillings at the time, only to see share values then drop on the back of loss, largely as a result of sharply risen fuel costs as well as one off costs dealing with staff re-adjustments. Financial analysts from the Citi Group have already suggested that Kenya Airways may still write the current year’s bottom line in red but also mentioned that the losses compared to last year could be less than half in a marked improvement of financial performance.
In the next financial year 2014/15 significant cost savings are expected through the use of more modern aircraft as at least 6 Boeing B787 Dreamliners are due to join the fleet, finally replacing the aged fuel guzzling B767’s after Boeing delayed the delivery by several years due to production problems.
A 7.8 percent reduction in seat capacity offered on European routes and a reduction of nearly 28 percent to North Africa, mainly caused by turmoil in Egypt which saw flights suspended, has helped the airline to shed some of the cost burdens associated with routes performing below expectations, manifested earlier in the year when Rome was axed from the route network.
The new year high of the Kenya Airways’ shares shows a return of investor confidence in Kenya’s national airline which in 2014 will take delivery of at least 11 new planes in line with their ‘Plan Mawingo’, their 10 year strategy document launched last year outlining projected growth in destinations to 115 and fleet, including freighters, to 119 by 2022. Watch this space for the half year results just as soon as they have been released by the company’s top management in the investors briefing later in the morning.