The Nairobi Securities Exchange (NSE) has announced the lifting of the suspension on the trading of Kenya Airways shares. Effective January 5, 2025, this decision marks a turning point for the national carrier, signaling renewed confidence in its financial performance and strategic outlook.
The suspension, which had kept Kenya Airways shares off the trading floor, was originally instituted to stabilize the company amid turbulent financial times. However, the recent announcement by the NSE reveals that the decision to lift the suspension was influenced by two major factors: the airline’s improved financial performance and the government’s withdrawal of the National Aviation Management Bill 2020.
“Notice is hereby given of the lifting of the suspension in the trading of Kenya Airways Plc securities, effective January 5, 2025. The suspension on the trading of Kenya Airways PLC shares was lifted following the company’s recent performance which saw the company record a profit after tax and the withdrawal of the National Aviation Management Bill 2020.” NSE said in a statement.
Kenya Airways has reported a turnaround in its financial performance, recording a profit after tax for the first time in years. This achievement reflects the company’s efforts to streamline operations, enhance efficiency, and adapt to changing market conditions. The improved profitability has instilled confidence among investors and market regulators, paving the way for the resumption of trading on the NSE.
The government’s decision to withdraw the controversial National Aviation Management Bill 2020 played a crucial role in facilitating the lifting of the suspension. The bill, which proposed restructuring the aviation sector, had created uncertainty around Kenya Airways’ future. Its withdrawal has provided clarity and stability, allowing the airline to focus on its core business and strategic objectives.
The lifting of the suspension was sanctioned by the Capital Markets Authority (CMA) under sections 11(3)(w) and 22A of the Capital Markets Act (Chapter 485A). This regulatory approval underscores the CMA’s confidence in Kenya Airways’ ability to meet its obligations and operate sustainably in a competitive market environment.
The resumption of trading is expected to have a significant impact on shareholders and investors. For those who have held onto Kenya Airways shares during the suspension, this development provides an opportunity to reassess their positions and potentially benefit from the company’s improved performance.
Additionally, the lifting of the suspension is likely to attract new investors seeking to capitalize on the airline’s turnaround. On its last day of trade on March 2, 2020, the stock closed at 3.83 shillings a share.
KQ achieved a record-breaking profit after tax of KShs 513 million in the first half of FY 2024, a significant improvement of KShs 22.2 billion from a loss position of KShs 21.7 billion reported over the same period last year.
During the year Kenya Airways experienced notable operational changes over the reporting period, highlighted by a 10% increase in passenger numbers, reaching 2.54 million travelers. The airline also expanded its capacity significantly, with Available Seat Kilometers (ASKs) rising by 16%, reflecting its commitment to meeting growing demand.
However, the airline faced market pressures, resulting in a 9% decline in yield, as competitive capacity adjustments influenced pricing and revenue per passenger. These figures demonstrate both the challenges and opportunities the airline navigated in its recovery and growth trajectory.
The company reported robust financial performance, with turnover increasing by 22%, driven by higher passenger numbers and expanded operations. Total operating costs rose by 22%, aligning with the airline’s capacity growth as it sought to meet rising demand.
Notably, operating profit surged by an impressive 40%, signaling improved efficiency and cost management. The most remarkable achievement was a 102% improvement in profit after tax, underscoring the airline’s strong recovery and strategic execution in the face of market dynamics. These results reflect the airline’s efforts to enhance profitability while expanding its market presence.
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