Kenya Airways future pegged on fuel pricing

But with demand for fuel expected to rise on the recovery of the global economy, the airline might not make savings in its un-hedged fuel bill in the second half of this year compared to the first half.

Despite the gain from fuel the airline recorded a slight decrease in its revenue to Sh33.4 billion from Sh34 billion same period last year.

The 1.7 per cent was due to a drop in cargo though passenger and handling revenues increased.

Cargo revenue dropped to 2.5 billion, a 15.9 per cent drop, with only 26,339 tonnes being uplifted during the period.

The current low passenger numbers are expected to hold into the second quarter as travellers stung by the global economic meltdown keep off the skies.

All routes experienced a drop in cargo uplifts with East Africa recording the highest drop of 44.7 per cent.

The drop in cargo numbers is in line with global industry figures that tumbled towards the end of last year.

Passenger numbers dropped by 1.9 per cent to 1,421,000 during the period due to traffic reduction in Asia, the Middle East and Europe.

Africa and the domestic market recorded positive growth in the first six months.

In a bid to continue recording positive growth from its strong markets the airline has put more emphasis on its cash cow region, Africa.

The airline is not relenting on its expansion in the region.

In the first seven months of this financial year the airline has introduced six new routes in the region, with focus on southern and central Africa.

It is now focused on adding three new routes on its network mainly to Saudi Arabia, Democratic Republic of Congo and Sudan.

It is also looking at increasing its frequencies on some of its high potential routes most of which are in Africa.

“We are putting strong emphasis on growing our routes. This is our life line to increase revenues,” said Mr Steller, adding that the European routes are expected to remain sluggish.