Kenya Airways (KQ, Nairobi Jomo Kenyatta) may consider multiple investors rather than just one, though no specific number has been determined yet, according to chairman Michael Joseph.

Speaking on Kenya's NTV television about potential strategic financing options for the national carrier, Joseph indicated a preference for a single investor but acknowledged this might be challenging given the global demand for airline investors.

"We would like to get a strategic investor, one strategic investor, into Kenya Airways. But it is not as easy as that. There are many demands for interested investors around the world for different airlines. So I'm just saying that we might be open to having a number of investors into Kenya Airways, rather than just one, but we do not have any specific numbers at this point in time," he explained.

Speaking on NTV last September, Kenya Airways Group CEO Allan Kilavuka explained that the airline must lower its debt-to-equity ratio, and to do so it needs a capital injection ideally from an investor since the government has other social-economic priorities. He said the injection would be used partly to pay off debt, but the larger portion would be used for growth. In particular, this would focus on acquiring new aircraft, modernising equipment, and enhancing the airline's IT infrastructure.

In addition, he said, Kenya Airways wants to expand its non-passenger revenue, such as its KQ Pride training centre, MRO, cargo, and KQ Medical Centre, and is even considering opening a KQ hotel. He explained that the goal is to diversify the airline's income streams, reducing reliance on its passenger business (currently providing about 88% of its income) to 65-70% over the next five years.

After-tax profit record

Kenya Airways reported a "record-breaking" upswing of 124% in after-tax profit of KES5.4 billion shillings (USD41.7 million) for the financial year ended December 31, 2024, a KES28 billion (USD216 million) improvement from a loss of KES22.6 billion (USD174.5 million) reported for the previous year, Joseph announced in a statement on March 25. Operating profit rose 58%.

He declared the airline's performance a "major turnaround", reaffirming progress in its turnaround strategy Project Kifaru.

Still, he warned that the unavailability of aircraft (both new and leased) and engines, plus a shortage of spare parts, was likely to impact the pace of the airline’s growth and full recovery, in addition to the lack of sufficient capital to expand the airline.

Fleet requirements

In early March, Kilavuka informed ch-aviation that an acute shortage of aircraft on the market was delaying the airline's pending decision on whether to go for Airbus or Boeing for the replacement aircraft of its fourteen E190s. "The delay of all these decisions is due to the acute shortage of aircraft," he said. The airline had hoped to take a decision on the replacement type by the first quarter of 2025. Aircraft being considered are the B737-8 MAX and B737-800NG versus the A320-200N and A321-200N.

In the meantime, Kenya Airways is looking to dry-lease more B737s to address its short-term capacity gap. "We are looking for any narrowbodies available, mainly B737s," Kilavuka said. It already operates nine B737-800s.

Kilavuka said the airline is also scouting for a B767-300F widebody freighter. "There is now an urgent need for a freighter, and we have started the search," he confirmed.

According to ch-aviation fleets data, the airline's current cargo fleet of four narrowbody freighters comprises two company-owned B737-300(SF)s and two dry-leased B737-800(SF)s.

Loan repayments

As previously reported, Kenya Airways must repay USD150 million to the Kenyan government through a shareholder loan agreement, with terms to be finalised by mid-2025.

This follows the Treasury settling KES19.3 billion (USD150 million) in unpaid loans owed by Kenya Airways to a consortium of Kenyan banks, which included Equity Bank, KCB Group, and Cooperative Bank, by the end of August 2024. As a sovereign guarantor, the Treasury had to make this cash settlement after the banks rejected the government's offer of repayment via a 6.5-year bond.