Africa: KQ shareholders re-appoint Michael Joseph as Board Chair
Kenya Airways shareholders have re-elected Michael Joseph as the Board Chairman for a second term with a mandate to steer the airline’s turnaround initiatives geared towards continued improvement of the airline’s financial performance.
The election of the chairman and other board members was part of the agenda of the airline’s 43rd Annual General where Chairman Kenya Pipeline Company John Ngumi was also appointed as one of the board members.
Michael Joseph has served as chairman of the board since October 2016.
During this period, the board has overseen the reduction of the airlines’ loss from the levels of Sh25 billion reported in 2015 to an improved position of Sh7.5 billion loss reported in the last financial year.
Board Chairman Michael Joseph said the company is focused on ensuring better results in the coming financial year.
“On a year on year comparison of 12 months, we managed to reduce our operational loss by Sh2.263 billion between 2017 and 2018. This, however, does not immediately jump out of our audited results since we changed the reporting periods, thereby making a comparison of 9 month in 2017 to 12 months in 2018. We expect this to even out in our next reporting cycle but more importantly, we are all committed towards delivering continued stronger results in 2019.” said the Board Chairman while updating shareholders on the performance during the AGM.
The chairman added that the airline has developed a 5-year plan built on realistic assumptions towards revenue increase and costs reduction.
“We are working towards efficient network planning including closure of unprofitable routes, launch of new prospective connections as well as upgrade or downgrade of equipment used to operate flights. As a result of these actions, we hope to significantly increase KQ’s passenger numbers and consequently revenue levels,” he added.
In the past 2 years, KQ has undertaken various measures to ensure financial and operating efficiency to enhance business sustainability despite unfavorable market conditions.
Network expansion is among the airline’s initiatives to overturn the business and grow its market share.
Currently, Kenya Airways flies 53 destinations worldwide and has a plan to two more routes in Europe as soon as this week.
“One of our biggest wins in 2018 was the growth in our revenue to reach Sh114.45 billion from Sh106 billion in 2017. Passenger revenue, which accounts for the lion’s share of KQ’s revenues, rose to Sh88.7 billion in the year ended December 31, 2018,” the chairman said.
He added that in addition to growing our revenues, the airline’s total direct operating costs, fleet ownership costs and overheads came to Sh114.868 billion, against the total revenue of Sh 114.185 billion, bringing our total operating loss to Sh683 million, a strong indication that in the very near future, the airline can once again be able to sustain its operations from their own internally generated revenues.
The airline was last week voted for the 6th time in a row as Africa’s leading Airline- business class and for the second time in a row as Africa’s leading airline Economy class in this year’s World Travel Awards. KQ has taken initiatives to invest in customer experience including providing extra leg room, access to KQ’s business class lounges and improving its menu.
Aviation is a strategic arm in the Kenya’s economic progress and strengthening Kenya position as an aviation hub in Africa is key to the country’s growth. KQ and KAA are looking to more collaborative working framework to optimize the capacity of both entities towards this objective.
The board that has 11 other members also saw the re-election of Kamau Thugge as well with one member, retiring.
By JULIE OWINO