NAIROBI, Kenya, Nov 28-National Carrier Kenya Airways has warned that the airline’s earnings will be affected for the next year owing to low revenues witnessed in recent months.
KQ board Chairman Michael Joseph in a statement on Friday said the projection has been influenced by low demand for passenger travel occasioned by coronavirus disease.
“The demand for air travel is still a fraction of the 2019 numbers and it is projected to stay suppressed for at least the next 12 months,” said Joseph.
The carrier has also expressed concern on the spike in coronavirus cases reported in some countries across the globe, saying it will likely fly the airline into further losses.
“As a second wave is currently affecting many countries which have imposed new restrictions, this is further impacting the airline’s revenue as it cuts capacity deployed to various destinations,” he added.
KQ management had resolved to adopt aggressive cost cutting measures and cash conservation measures to minimize the impact of the airline.
The firm also shut down some of its 7 stations which it considered to be loss making.
The announcement follows a projection in August by KQ CEO Allan Kilavuka which cited that KQ may lose Sh70 billion or more in 2020, compared to the Sh12.98 billion losses it recorded in the 2019 financial year.
This was revealed during the release of its half year earnings in which the firm reported losses of up to Sh14.3 billion.
Early this week, KQ started direct cargo flights from Mombasa to various destinations to boost its business.
KQ Cargo will initially run one weekly flight from Mombasa ferrying mostly tropical fish to Sharjah international Airport in UAE and will gradually increase frequencies and destinations as demand grows.