Kenya Airways pre-tax profit for six months up to September 30, has declined by 18.8 per cent.

The national carrier posted a profit of SH2.8 billion compared to SH3.4 billion made in the same period last year.

Kenya Airways CEO, Titus Naikuni, said the airline had been grappling with problems of fuel price fluctuations and decline in cargo volumes.

The strengthening of the shilling against the dollar is estimated to have cost the airline SH125 million in profit after tax in this period. "Any further strengthening of the shilling will exacerbate this effect in the future," said the CEO.

The crash of one of its aircraft in Cameroon was also among the challenges of the airline during the period.

He said the plane's compensation had been finalised while about 16 members of next of kin of the accident victims had received compensation.

The passenger traffic increased to 1.4 million for the first half up from the prior period's 1.3 million.

High Overheads

The amount received from cargo and mail carried declined to SH2.5 billion from SH2.8 billion in the same period last year.

Overheads increased by 14 per cent to SH5.2 billion compared to SH4.5 billion which Mr Naikuni explained was due to hiring of more pilots and engineers. He said the airline was facing intensified competition after the entry of Virgin Atlantic.

Others that the national carrier is in competition with are Qatar Airways and Emirates.

The competition is set to increase further next year with the anticipated entry of Delta, Air China and Air India.

"We intend to concentrate on Africa where the potential is enormous. Sometimes, we have to maintain unprofitable routes to feed the profitable routes," Mr Naikuni said.

The traffic in West and Central Africa increased by 28 per cent due to additional destinations of Liberia and Benin.

Other areas that experienced growth are North Africa that grew by 15 per cent, Far East 13 per cent and South Africa 9 per cent.

He said the airline was on course to fully effect e-ticketing by December despite IATA having extended the deadline to May next year.