Kenya Airways share strengthens to Sh4.95

Shares of Kenya Airways (KQ) rose 7.61 percent during the day’s trading session to close at Sh4.95 up from Sh4.60 on Monday.

The strengthening of the airline’s share comes a day after pilots suspended their planned strike demanding management changes.

Traders attribute the share appreciation to improved fortunes at the airline which has already announced that its half year loss has reduced to just Sh5 billion compared to a loss of Sh12 billion a year earlier.

The share is expected to strengthen further in the coming weeks, with government assurance of management and board changes to get the airline back to profitability.

Transport Secretary James Macharia said there was a plan in place to ensure smooth transition once the changes are made.

“KQ is a listed company so there are things we cannot say in public but let me assure Kenyans that we have done all that is necessary. We commissioned a forensic audit by Deloitte and Touche and committed to take action including handing over that report to the investigating agencies,” Mr Macharia said on Tuesday.

Already former Safaricom Michael Joseph has been appointed as the board chairman and is expected to charter the way forward in injecting fresh faces at the senior management level.

Kenya Airways has been struggling to return to profitability after years of losses caused by a slump in tourism and high financing costs caused by the purchase of new planes.

The airline’s board is expected to meet in the next one week with changes to be announced in due course.