KQ route expansion plan leads to rise in passengers

Kenya Airways has reported a 27.6 per cent growth in passenger numbers in the first quarter of 2011.

The rise in travellers has been boosted by the opening of new routes, thus raising its profit outlook in a year seen to be difficult for the airline industry.  The national carrier carried 850,908 passengers in the three months to June 2011 up from 666,855 carried in a similar period the previous year.

New routes by the company include direct flights to Rome (Italy), Luanda (Angola), Nampula (Mozambique), Malindi (Kenya), N’Djamena (Chad), Malabo (Equatorial Guinea) and Nsimalen (Cameroun).

These pushed the airlines capacity up by 20.3 per cent to 3,386 million seat kilometres. Introduction of the Rome route saw the airlines capacity to Europe grow by 26.3 per cent to 108,835.

“The growth underpins increased long haul customer travel to Europe, Middle East and Far East Regions,” read the statement.

“Growth in business confidence corresponds with demand for premium travel and this should translate into increased demand for air travel,”  Mr Titus Naikuni, the airline’s chief executive officer, told investors during the release of last year’s financial results.

The International Air Transport Association downgraded the profit forecast for the aviation industry after the March 11 tsunami in Japan, unrest in the Middle East and North Africa and increasing oil prices. It estimated that the industry would report 78 per cent dip in earnings to $4 billion this year.

However, Kenya Airways has remained upbeat that the growing business confidence in Africa — as attention shifts on the fastest growing continent. The airline’s ongoing route expansion will sustain its growth, from Sh3.5 billion it earned last year having carried 3.1 million passengers.

Also increased frequencies to London saw its capacity to Europe grow 26.3 per cent compared to the same quarter in prior year.

“The Middle East, Far East and Asia regions registered a capacity growth of 22.3 per cent as a result of increased frequencies to Dubai via Muscat.” The airline carried 432,366 passengers in Africa excluding Kenya, representing an 18.1 per cent growth last year.

The domestic front recorded the highest growth, increasing 62.5 per cent to 184,845 due to additional daily frequencies to Mombasa route and the introduction of Malindi flights. “Kisumu steadily grew by 95.8 per cent after the reopening of Kisumu airport that had been closed for runway upgrade and renovation.”

However the airlines cabin factor has remained stagnant at 71.9 per cent this year compared to the 71.7 per cent achieved last year, a pointer that the airline yet to achieve an optimal usage of the available seat capacity. Cabin factor is the revenue from passengers compared to the available seats.

The airline which is hedging its fuel costs to control rising oil prices is also counting on the new routes on its radar this year such as Jeddah in Saudi Arabia and Beirut in Lebanon as well as Abuja in Nigeria, Tanzania’s Kilimanjaro, Mauritius Port Louis and Asmara in Eritrea among other rafts of strategies to grow its passenger numbers and maintain its profitability.