Category Archives: Kenya Airways

Kenya Airways 2018 results

Excerpts from the announcement of the Kenya Airways 2018 financial results April 30, 2019 at Ole Sereni Hotel. Nairobi at a breakfast event with investors and media.

Performance: 2018 revenue was Kshs 114 billion (~$1.14 billion), compared to 81 billion in 2017 at the airline, which is in the middle of discussions about taking over the management of the Jomo Kenyatta International Airport (JKIA) under a public-private partnership (PPP).

Chairman Michael Joseph said 2018 had been a challenging year, one highlight of which was the launch of non-stop daily flights New York, but there was a lot media scrutiny on PPP on JKIA that was wrong and excitable. He said that the airline was on the right path and thanked the staff for doing a great job under difficult circumstances.

CEO Sebastian Mikosz said this was the second year of growth in passengers and cargo and a narrowed loss. The difference to 2017 (which was abbreviated to 9 months as the airline changed its financial year-end to match IATA and its financial partners) was stark but the CEO went out of his way to compare unofficial twelve month numbers for 2017 to highlight that the airline had increased income, and flown more passengers despite the smaller fleet in 2018. They had 13,258 daily customers (up from 12,484),  a cabin factor of 76% and on-time performance 79%.

They earned Kshs 95 billion from flying 4.84 million passengers in 2018, Kshs 8.5 billion from cargo 8.5 billion and earned Kshs 10 billion from other business including ground handling and repairs and maintenance and training,. While the revenue covered their fleet ownership, fuel and staff costs, they ended with an operating loss of Kshs 683 million and, an overall loss before tax of Kshs 7.5 billion ($75 million).

Fuel: Accounts for 40% of costs, and as prices went up 30% in 2018, it remains one of the biggest challenges to profitability. As such they are going back to fuel hedging as a risk minimization strategy.

Fleet: They are getting back two Boeing 787’s from Oman Air but have extended an ongoing lease with Turkish to retain three Boeing 777-300’s which are simply too large to operate given the current loads and will introduce a complexity  that is not desirable now.

Routes and Partnerships 
  • The New York direct flight route had flown 15,000 passengers as of December 31 2018. The load factor is 64% and CEO said that there was nothing lucrative about NYC but it helped serve the Africa Market with 5 weekly flights which they will adjust back to being daily flights in the summer. The non-stop route offers the fastest route between New York and Indian Ocean destinations countries like Mauritius
  • The Air-France-KLM joint venture is still the biggest part of their business. They have now added one with Delta enabling KQ to sell flights to Delta destination cities beyond New York.
  • UN: With the addition of Geneva (and Rime) in June, they will now fly to all the main UN cities – Geneva, Mogadishu, Paris, New York – from Nairobi, completing their UN network.
  • JamboJet: They are trying to pushing to get their Jambojet subsidiary IOSA-certified so they can codeshare on more local routes.

African Aviation: The results presentation showed comparisons to Rwandair, Ethiopian, Turkish, Ethiopian and Emirates airlines, but Mikosz said that KQ was the only airline interested in growing the Nairobi hub. The CEO cautioned that while in 2010, Ethiopian was the same size as KQ, today it was three times bigger, and that was due to support systems, Also that Rwandair, while considered small today, will catch KQ in five years unless KQ grows its hub in this competitive environment.

PPP: The fate of the public-private partnership proposal for the airline to manage JKIA is still with the Privatization Commission who turned it over to Parliament for public hearings that were stormy at times and led to a lot of inaccuracies. The CEO and Chairman said it was not necessary for the growth plan that the company had presented to shareholders during their 2017 restructuring, but it was one which would accelerate its rate by levelling the playing field with its continental peers.

Embraer Woos Africa

Fresh from the Farnborough air show, Embraer embarked on an African tour to showcase their planes in what they see as an under-served air market on the African continent.

The company flew an Embraer E190 E2 jet with a unique shark-nose look (nick-named “profit-hunter”) to Algiers (home of Air Algerie)  and Casablanca (Royal Air Maroc), then on to Accra and NairobiKenya Airways (KQ), which is the largest Embraer E-jet operator in Africa and also hosts one of the few approved E190 services centres in Africa, staged an event that featured local aviation officials, KQ customers and the Brazilian Ambassador to Kenya that ended with a demonstration flight that over Mt. Kilimanjaro, Africa’s highest point. 

Embraer was keen to showcase the quietness and efficiency of the E190 which they bill as the best single-aisle aircraft. They view Africa as an under-served aviation market in which 95% of flights have less than 150 passengers and 61% of routes have less than one flight per day, with many potential new routes being 4-5 hour flights, that are beyond the operational reach of propeller planes and with their E-jets as just the right size for African airlines. 

Kenya Airways has been flying Embraer’s since 2006. They started with the smaller E170 and upgraded to the E190’s which now form a third of their lean fleet; they have 15 of them – 10 are owned, 5 on lease  – and they seat 12 passengers in business class and 84 in economy. But it is unlikely that Kenya Airways that is emerging from a long restructuring process will be buying any more planes soon, but other things are happening and at Farnborough, Embraer and KQ announced a new spare parts supply deal.

After Nairobi, the E2 jet flew on to Mauritius where Air Mauritius is tipped to be a potential customer and they planned to continue on to South Africa where Embraer has a training centre and a regional office for Middle-East and Africa.

KQ KAA Partnership at JKIA

This week, Kenya Airways and the Kenya Airports Authority – (KAA) published a joint notice about discussions towards collaboration in the management of Nairobi’s Jomo Kenyatta International Airport (JKIA).

This is not new or unique. Last year the Ethiopia government merged it’s airline, the largest airline in Africa, making it the centerpiece of a hub-strategy for Addis that incorporates the airport, passengers, logistics, training, catering and tourism). In Rwanda there is also a similar management arrangement, another soon at Tanzania, while the latest results from Emirates, in its 30th year of profit announced last month, show 14% of their revenue was from cargo and 15% was from D-nata which does ground handling and logistics for other airlines around the world including from extensive investments in Europe, Asia, and North America.

At a previous shareholders meeting (AGM), KQ Chairman Michael Joseph spoke of closer ties with the government, and the need for the airline to get in involved in route approval, and protecting Nairobi as its hub. He said that whenever a foreign leader visited or the President of Kenya went overseas, a “win” from such trips was the granting of more rights to foreign airlines to fly into Kenya, which was to the detriment to KQ, in which the government had a significant investment.

According to its latest results (June 2016 from the Auditor General of Kenya), KAA which constructs, operates and maintains aerodromes around Kenya (including 16 airports)  had Kshs 13.5 billion revenue and a Kshs 2.6 billion profit (in the previous year, this was Kshs 4.4 billion).

The revenue includes Kshs 6.7 B (billion) in passenger service charges, Kshs 1.7B from concessions and Kshs 3 B from landing and parking fees – half of which are probably paid for by Kenya Airways. JKIA handled 100,000 aircraft takeoffs/landings and processed 6.7 million passengers (out of the 9.6 million KAA handled in total) and 235 million tons of cargo.

But KAA also comes with it a lot of politics such as tussles over the composition of its board and top management and project disputes such as the Greenfield terminal at JKIA, and with private developers such as World Duty Free at JKIA and other land disputes at various airports around the country.

The newspaper report (Business Daily) also mentions that the proposed partnership with will also see Kenya Airways exempted from payments of some Value Added Tax (VAT) and the Railway Development Levy, a 1.5% tax on all imports into Kenya that is meant to finance ongoing development of the Standard Gauge Railway (SGR). 

EDIT Sept 3, 2019: Kenya Airways formally withdrew the Privately Initiated Investment Proposal (PIIP) following a quarterly meeting of its board of directors on August 27 2019.

Kenya Airways and Delta Codeshare

EDIT: 11 April 2019: Kenya Airways has activated its codeshare with Delta Airlines that will enable connectivity to 11 US cities (Chicago, Houston, Denver, Orlando, Miami, Raleigh, Phoenix Philadelphia, Charlotte, Columbus, and Kansas City) and 4 Canadian cities (Toronto, Montreal, Ottawa, Edmonton). It also announced a switch from five to seven weekly flights to New York from June to serve the 2019 summer season.

EDIT 15 August 2018  Delta Air Lines entered into a codeshare partnership with Kenya Airways. Effective August 15, Delta’s code will be placed on Kenya Airways’ flights from Amsterdam, Paris, London, and Accra to Nairobi, enhancing connectivity and providing customers with a one-stop seamless travel experience from the United States. In addition, Delta will place its code on Kenya Airways’ services to more than 10 key cities across Africa, including Addis Ababa, Ethiopia; Lilongwe, Malawi; Maputo, Mozambique; Johannesburg, South Africa and Djibouti City, Djibouti.

May 10 2018 Delta Air Lines and Kenya Airways have applied to the US Department of Transportation with an expedited request for the two airlines to be expeditiously granted reciprocal codeshare rights for each others’ flights.

The application (PDF) dated 7th May, applies to Delta and Delta Connection flights in North America, Latin America, and the Caribbean to carry the Kenya Airways (KQ) code, while the Kenya Airways will immediately place Delta’s code (DL) on flights between Nairobi to/from Johannesburg (South Africa), Lilongwe, (Malawi), Djibouti (Rep. of Djibouti) and Maputo, (Mozambique).

Delta routes will be part of the codeshare.

Delta which reaches 325 destinations, currently has services to Dakar (Senegal), Lagos, Accra, and Johannesburg, while Kenya Airways is scheduled to start flights to New York in October 2018. There is no mention of Air France/KLM, who have been Kenya Airways long-term joint-venture partner for two decades, in the new US codeshare application.

The new codeshare arrangement which covers “persons, property, and mail,” is an expansion of a previously approved reciprocal codeshare arrangement between Northwest Airlines and Kenya Airways for flights originating in Kenya and North America. Northwest merged with Delta in 2009. The new codeshare will also extend to all Delta Connection regional affiliate airlines (namely Compass Airlines, Endeavor Air, ExpressJet Airlines, GoJet Airlines, Republic Airline and SkyWest Airlines).

Aside from Kenya, Ethiopian Airlines, which flies to several American destinations of Washington (DC), Newark, Los Angeles, Chicago, Toronto (Canada), Buenos Aires (Argentina) and Rio de Janeiro & São Paulo (Brazil) is also expanding its American network via routes in West Africa. The airline is reported to have secured rights to fly passengers to Houston via Accra, while it also confirmed that it had entered a codeshare with Air Côte d’Ivoire for flights to Newark via Abidjan.

Idea Exchange: Food, Fellowship, Counties, Army Worm, Film, Sports, AI, Oil Opportunities

New, and ongoing, opportunities to apply for.

UNCTAD: United Nations Conference on Trade and Development, jointly with Jack Ma, founder and executive chairman of the Alibaba Group, have the eFounders Initiative aims to help bridge the digital divide faced by young entrepreneurs in developing countries and allow them to grasp the opportunities of e-commerce ecosystems.  This capacity building programme to empower 1, 000 e-commerce entrepreneurs from developing countries over a period of five years to become catalysts and the next course will focus on African entrepreneurs from Algeria, Egypt, Kenya, Morocco, Namibia, Nigeria, Rwanda, South Africa and Uganda and will take place at the campus of the Alibaba Business School in Hangzhou, China from 19 to 29 June 2018. Application Deadline: 4 May 2018
Earth Journalism Network: Climate Change Media Partnership 2018 Reporting Fellowships Apply to report from both the Global Climate Action Summit in San Francisco and the UN Climate Negotiations in Katowice, Poland.

The Africa Food Prize is the preeminent award for recognizing the extraordinary individual or institution whose contributions to African agriculture are forging a new era of sustainable food security and economic opportunity for all Africans.  The deadline for nominations for the USD 100,000 prize is Tuesday 15 May and the 2018 winner will be unveiled at a high-profile gala dinner at the African Green Revolution Forum (AGRF) 2018 this September in Kigali, Rwanda.

African Food Security Prize Launched to Stop Devastating Crop Pest: Feed the Future, supported by Land O’Lakes International Development and the Foundation for Food and Agriculture Research, has opened its call for applications for the Fall Armyworm Tech Prize that offers to fund up to $400,000 in digital solutions that aim to help stop the spread of fall armyworm in Africa-a pest that is devastating agriculture and demolishing billions of dollars’ worth of crops across the continent. The application deadline is 14 May 2018 and applications may involve a range of digital solutions and must demonstrate how the proposed tool(s) will help smallholder farmers and those that reach them, such as extension agents, monitor, identify, treat or report the incidence of fall armyworm.

Africa Innovation Summit II: A call for application has been launched across Africa for innovations addressing the continent’s challenges – which include energy access, water, food insecurity, health systems, and governance. Applications close on 15 April.

The 2018 African Union Research Grant offers up to $9 million of funding. The deadline for applications is May 22 The call supports research on food, nutrition security and sustainable agriculture (FNSSA).

Andela Kenya, Uganda, Nigeria Fellowships:  The recruitment Schedule for Andela Kenya fellowship cycle 29, and Andela Nigeria, cycle 33 deadline is May, while for the Andela Uganda fellowship cycle 9 and boot camp, the deadline is April 27.

Anzisha Prize: Aims to find a young entrepreneur who is making a difference in their community,  aged 15- 22 so that they can have the chance to win a shared amount of US$100 000 and become an Anzisha fellow. The deadline is 15 April.

Asoko, in a new collaboration with the London Stock Exchange Group, PwC and CDC Group is seeking Africa’s leading private companies – companies to Inspire Africa for a leading report showcasing Africa’s 1,000 most dynamic private, high-growth companies. Deadline is June 11.

BAKE Awards 2018: The nominees of the Bloggers Association of Kenya (BAKE) Awards 2018, that recognizes and awards the best in Kenyan blogging have been announced  in categories including Technology, Photography, Creative Writing, Best Business Blog, Food , Environmental , Fashion & Style, Agricultural, Best New Blog, Corporate Blog, Sports, Entertainment, Education, Travel, Public Health, County Blog, Religious or Spirituality , Lifestyle, Beauty & Hair, Best Video Blog (Vlog), Social Issues & Active Citizenship, and Kenyan Blog of the Year. Voting for the winners is now on, up to 30 April.

The BMCE Bank of Africa – African Entrepreneurship Award 2018 has $1 million of prizes and a trip to Morocco for entries in categories of innovation or sports entrepreneurship. Deadline is  April 30, and more details here.

Chatham House invite applicants for the Academy Africa Fellowship in the Queen Elizabeth II Academy for Leadership in International Affairs in research topics for 2018-19 of
new technologies and their impact on international security (with a focus on artificial intelligence or space), the geo-economics of technology, climate-resilient development ( managing energy transition in a low-income context) and the rising burden of non-communicable diseases (NCD’s) in Africa. The deadline for applications is 29 April.

DEMO Africa 2018: DEMO Africa is a launch pad for emerging technology and trends, attracting over 2000 people from around the globe to experience the finest African innovations. The top five startups from DEMO Africa will be sponsored to Silicon Valley for an all-expense paid trip to be part of the Lions@frica Innovation Tour. Now accepting startup applications until June 15.

EDiT Research Fellows in Applied Development Finance: The Global Development Network (GDN) and the European Investment Bank (EIB) have partnered to create the ambitious EIB-GDN Program in Applied Development Finance for deepening understanding of EIB’s investment operations in African, Caribbean and Pacific (ACP) countries. Under this partnership, GDN and EIB will identify, train and deploy teams of research professionals in the ACP regions to conduct “deep dive” studies of selected projects funded under EIB’s Impact Financing Envelope (IFE).

Kenyan winners from the Tony Elumelu Foundation announced earlier this year

Fourth Mining 4i: The Strathmore Extractives Industry Centre (SEIC), in collaboration with the Kipya (Africa) Limited and Extractives Baraza, hosts the Fourth Mining 4i, an annual invite-only forum which focuses on the promotion of Kenya’s mineral potential by attracting investment in technological innovation.

Google Africa Scholarship Program:  Web and Android Scholarships available for residents of African countries. Some scholarship recipients may be able to participate in an Andela Learning Community with our partners from Andela. Finally, top students from each track will earn full scholarships to one of our Android or Web Development Nanodegree programs. Applications due by April 24.

Kalasha Kenya: Submit your entries for the #MyKenyaMyStory competition for a chance to walk away with grand prizes worth Kshs 500,000 Check poster for more details.

The Competition Authority of Kenya #CAKuzaAwards2018 is celebrating excellence in Kenyan Broadcasting. Vote for your favorite TV and Radio Station, by sending the word KUZA to 15601. Voting is free.

Merck Accelerator Nairobi Satellite Program: In partnership with Mettā, Nairobi, Merck Accelerator’s satellite program in Nairobi is seeking early-stage startups with no more than 4 years in existence, startups in the fields of Healthcare, Life Sciences, Performance Materials and other search fields such as Biosensing and Interfaces, and Precision Farming. For startups based in East Africa, Nairobi Applications are open to May 5, 2018, and founders that are available are to attend a boot camp on May 15-18 in Nairobi, Kenya, if selected.

MEST Africa Challenge 2018: MEST is celebrating 10 years of supporting aspiring African entrepreneurs with a first Pan-African pitch competition, the MEST Africa Challenge. MEST Africa Challenge 2018 will give winning applicants the chance to meet and pitch to leading investors, corporate and ecosystem partners from Africa and beyond, at the finals in Cape Town. The trip will be fully funded. The winning entrepreneurs could receive, as much as, sh.5,000,000 ($50,000) in equity investment and space in one of MEST’s incubators. Companies that apply must be primarily tech-focused. Details here and the deadline for applications is April 22.

Microsoft Imagine Cup 2018: Microsoft has announced this year’s Imagine Cup, the students’ developer technology and innovation competition that will see winners walk with $100, 000 in prizes. Imagine Cup participants create or join a team of up to 3 students. Together, they make an original technology project from start to finish: come up with a great idea, make a plan, build a project, and submit. This year’s Imagine Cup has three special awards that represent the current state of digital transformation: Artificial Intelligence, Big Data, and Mixed Reality.

Norwegian Accelerator, Pangea, a platform connecting African startups with international investment & expertise, has shortlisted 11 start-ups who will be considered for funding of up to 50,000 USD per startup. The 11 start-ups companies are drawn from Kenya-9, Egypt -1 and Nigeria-1. Pangea plans to launch a crowd investment platform in June 2018, allowing accelerated startups further access to funding.

The 8th Orange Social Venture Prize for Innovative Startups in Africa and Middle East (50,000 Euros in Prizes) aims to reward the best innovative business projects. Application deadline is May 31, but now no more Kenyan firms are eligible after Orange divested from Kenya.

Pitch AgriHack 2018 for young agriculture entrepreneurs is a competition for agriculture startups owned by young entrepreneurs, with reward being capacity building and access to a grant. It is organized by the Technical Centre for Agricultural and Rural Cooperation (CTA) and the African Development Bank (AfDB). 8 winners will be selected from 2 categories and there will be an additional category to reward a woman-owned, founded or co-founded startup by one of the partnering organizations that made Pitch AgriHack 2018 possible. It is open to e-agriculture startups offering digital services in the agriculture sector. Details here and the deadline is 21 May.

She Leads Africa Accelerator is set to provide training and funding for women-led technology enabled businesses. The 2018 Accelerator will consist of three 1-week residencies in Lagos where entrepreneurs will receive training from the SLA team, business leaders and experts. Applications close on May 20.

Upstream Oil & Gas Awards: The Upstream Awards 2018 is a ceremony to recognize and celebrate outstanding achievements from within the emerging upstream oil and gas industry. Nominations have closed for, among others, nominees for company of the year, drilling contractor, oil field services ​company of the year, upstream CEO, upstream woman of the year award, local community award, local supplier, oil & gas future leader, upstream financier of the year, journalist of the year, legislator of the year, engineering award, life achievement award, and upstream county award.

USAID and Feed the Future have issued an invite to Sub-Saharan Africa women in agribusiness for the Accelerating Women Entrepreneurs Prize 2018. It is open to women helping smallholder farmers increase access to agricultural input (seeds, fertilizer, etc.), technology (ICT, irrigation, etc.), financial and risk management services. Winning applicants will enjoy access to capital to scale and improve their work. Details here and the deadline for applications is 25 April.

Visa will open the first Visa Everywhere Initiative for Sub Saharan Africa to young developers at this year’s Nairobi Tech Week (NTW) taking place from April 19- 21. Developers who win the Visa-led hackathon during the tech week will automatically gain entry into the Visa Everywhere Initiative where they will have an opportunity to compete for a chance to win up to US $50,000, at a regional event in the region.

WTO 2018 Essay Award for Young Economists:  The WTO has issued a call for young economists to submit papers for the 2018 WTO Essay Award. The award aims to promote high-quality research on trade policy and international trade co-operation and to reinforce the relationship between the WTO and the academic community. Essays must be submitted by 1 June 2018, must address issues related to trade policy and international trade co-operation and cannot exceed 15,000 words.

2018 World Travel Awards:  Nominees have been selected and voting for African winners in is open up to 19 August in categories including (*Kenyan nominees in brackets) – Leading Luxury Private Villa (Cottar’s Bush Villa, Maasai Mara) Africa’s Leading Tented Safari Camp(Elephant Pepper Camp Masai Mara, Fairmont Mara Safari Club, Finch Hattons, Mahali Mzuri, Porini Amboseli Camp, Selenkay Conservancy) Africa’s Leading Safari Lodge (Borana Lodge, Kicheche Bush Camp, Loisaba, Ngerende Island Lodge, ol Donyo Lodge, Sirikoi),  Africa’s Leading Meetings & Conference Centre 2018  (The Kenyatta International Conference Centre), Africa’s Leading Serviced Apartments (Cowrie Shell Beach Apartments), Africa’s Leading Private Island Resort (Manda Bay, Rusinga Island Lodge) Africa’s Leading Luxury Hotel Villa (The Cliff Villa, Alfajiri Villas) Africa’s Leading Hotel Residences (Palacina),  Africa’s Leading Hotel (Fairmont Mount Kenya Safari Club, Fairmont The Norfolk Hotel), Africa’s Leading Green Hotel ( Nairobi Serena Hotel, The Aberdare Country Club) Africa’s Leading Family Resort (Fairmont Mount Kenya Safari Club, Leopard Beach Resort & Spa), Africa’s Leading Business Hotel 2018 (Fairmont The Norfolk Hotel, Radisson Blu Hotel, Nairobi Upperhill, Tribe Hotel), Africa’s Leading Boutique Hotel (Giraffe Manor, The Safari Collection,  Hemingways Nairobi, Lion in the Sun)  Africa’s Leading Beach Resort (AfroChic Diani Beach, Almanara Luxury Resort, Swahili Beach, The Majlis), Africa’s Leading All-Inclusive Resort 2018 (Diamonds Dream of Africa) Africa’s Leading Tourist Board 2018 (Kenya Tourism Board) and Africa’s Leading National Park (Masai Mara National Reserve).  

Kenya Airways has been nominated for Africa’s Leading Airline – Business Class, Africa’s Leading Airline – Economy Class, Africa’s Leading Airline, Africa’s Leading Airline Brand 2018 and Leading Inflight Magazine (Msafiri). Also nominated are Fly540 and Jambojet, for Africa’s Leading Low-Cost Airline 2018  and AirKenya, Fly540, Mombasa Air Safari, Safarilink Aviation, Tropic Air for Kenya’s Leading Domestic Safari Carrier 2018.

What other opportunities are there for readers to apply for?