Kenya Airways reports 'very challenging' environment in 1HFY2015, outlook positive

Kenya Airways reported (13-Nov-2014) a "very challenging" business environment in 1HFY2014/15 due to the fire at Nairobi Airport in Aug-2013, regional security issues and resulting travel advisories, and the Ebola outbreak in West Africa, which impacted traffic volumes. Operating costs increased mainly due to deployment of additional capacity. Capacity in Europe increased 15.2% with the introduction of Boeing 777-300 equipment to Amsterdam and 787 equipment to Paris. Middle East and Asia capacity increased by 20% overall with the replacement of old aircraft. Capacity within Africa increased 11% with increased widebody operations on key feeder services to Harare, Johannesburg, Kinshasa, Lagos, Lilongwe and Lusaka. the airline also increased frequency to catchment areas in East Africa, including Bujumbura, Dar Es Salaam, Entebbe and Kigali. Domestic capacity increased 42% with the commencement of operations by Jambojet and increased Mombasa and Kisumu frequency. Increased capacity resulted in growth in direct operating costs with fuel costs increasing 11% to comprise 35% of total operating costs. The carrier reported positive prospects for its business, driven by deployment of a more fuel-efficient fleet and the opening of terminal 1A, new lounges and improved infrastructure at Nairobi Airport. [more - original PR]