Expectations driven by potential savings through the use of the new Dreamliner fleet and the ongoing fall in the cost of JetA1 fuel have raised Kenya Airways’ share price by the end of business at the Nairobi Stock Exchange yesterday to 10.95 Kenya shillings. Compared to six months ago, when the share price had dropped to only 7.75 Kenya shillings per share after more losses loomed on the financial horizon, this constitute a rise in share value by some 40 percent.
While the share value remains significantly below the price of the last share issue, hopes are now rising that the new management will find ways and means to arrest the financial rot and return the airline to profitability. This is in part based on the slowing down of the Ebola pandemic in West Africa and the ever more likely return of Kenya Airways to destinations the airline had to drop when the government caved in to a public hysteria at the time. Kenya Airways’s closest competitor, Ethiopian Airlines, continued to fly to the affected region, running away with market share and making a re-entry by Kenya Airways an added challenge.
The delivery of three more B787 Dreamliners this year, alongside more B737-800NGs and B777s will help the airline to finally launch additional destinations in China, from where the traffic growth to Africa has been way above average. Another positive factor will be the anticipated outcome of the audit by the Federal Aviation Administration (FAA) which will determine if Kenya’s main airport, Jomo Kenyatta International, will finally receive Category One certification, which will allow for the launch of direct flights to the United States.
Now operating from the new Terminal 1A, Kenya Airways is geared towards better service delivery on the ground free of the perennial congestion the airline suffered at their old home in what used to be Unit 2, now renamed Terminal 1C. “KQ [Kenya Airways] has done quite a few things over the past months which have improved operations on the ground. The new busses give a much better impression, and priority handling has also helped to retain and in fact grow their premium passenger base. The new lounges are the best in the region, and combined with the new terminal, does the ground handling now match service in the air,” wrote a regular source when passing on the information yesterday afternoon.