Kenya’s national carrier, Kenya Airways, has returned to losses, reporting a Sh12.15 billion deficit for the half-year ending June 2025.
This marks a significant downturn compared to the profit posted during the same period last year, with the airline citing a grounded fleet and subdued demand as key factors.
According to the airline’s financial disclosures, the drop was driven by a 14 per cent decline in passenger numbers and reduced capacity, which cut into revenues.
The airline’s net margin slumped to negative 16.3 per cent, down from a 0.6 per cent profit margin in 2024. This compares with a Sh513 million profit recorded in the first half of last year.
As a result, the airline recorded an operating loss of Sh6.24 billion, compared to an operating profit of Sh1.3 billion last year. This translated to a negative operating margin of 8.4 per cent, down from 1.4 per cent in 2024.
While total operating costs eased slightly to Sh80.7 billion from Sh90.2 billion, a reduction of Sh9.45 billion year-on-year, other costs soared to Sh5.97 billion from Sh687 million, placing additional strain on the balance sheet.
Interest income rose marginally to Sh35 million, up from Sh23 million, but remained insufficient to offset ballooning expenses.
Kenya Airways has attributed part of the setback to the grounding of three Boeing 787-8 Dreamliners for maintenance. Chief Executive Officer Allan Kilavuka said one of the aircraft resumed service in July, and the airline is working to have its full fleet operational by next year.
“We’ve said the minimum that we are gunning for is about half a billion dollars, which we believe is a minimum. That will address the fleet expansions that we’re looking for,” Kilavuka said on Tuesday.
He confirmed that the airline intends to raise at least $500 million (Sh64.5 billion) in extra capital to expand and improve its fleet, with shareholder approval expected by the first quarter of 2026.
The latest results come after Kenya Airways ended 2024 with a Sh5.4 billion profit, the first in more than a decade, compared to a Sh22.6 billion loss in 2023.
The performance was driven by a six per cent revenue growth to Sh188.5 billion, stronger passenger demand, a 25 per cent rise in cargo tonnage, and a foreign-exchange gain of Sh10.55 billion following a stronger shilling.
Despite the relapse into losses, the airline said it is working to address capacity constraints, stabilise operations and improve efficiency to return to a growth path in the second half of the year.
Kenya Airways has been in the red since 2013, sliding into insolvency in 2018 after an aggressive expansion strategy left it with heavy debt. The collapse of global travel during the COVID-19 pandemic, combined with currency depreciation and high interest rates, worsened its financial challenges.
