But losses before tax were down by 60.9 percent at 10.2 billion shillings ($98.8 million) in the year ended March 31 and the company reported an operating profit of 897 million shillings which compared with a loss of 4 billion shillings in the previous year. Mbuvi Ngunze, the outgoing chief executive, said the improvements put it in a good position to boost its capital and restructure debt.
The share price was up 2.3 percent at 6.75 shillings following the results. "There were doubting Thomases out there who said KQ is dead and buried," Ngunze told Reuters. "But we said we are resilient." Passenger numbers were up by 5.4 percent last year at a record high of 4.5 million, with the average percentage of seats sold up 4 percentage points at 72.3 percent of capacity, boosted by a 13 percent jump in traffic on African routes.
The improvements came as the airline cut its fleet by eight widebody Boeing aircraft in the last 18 months to combat overcapacity and costs. "We have gone back to basics. We have had to unlearn, learn and re-learn how to do business in a changing competitive context," said Ngunze, who became CEO in 2014 as the airline sank into the red.
He said the airline's main risk now was currency depreciation in countries like Egypt, Sudan, South Sudan, Angola, Mozambique and Nigeria, making it hard to price services and repatriate cash. Global carriers had $400 million stuck in Nigeria at the height of its foreign exchange crisis last year but this year the government had worked with the industry to introduce solutions like forward purchase options, he said.