Kenya Airways’ (KQ) total debt increased to Sh142.79 billion in 2024, up from Sh141.70 billion the previous year, according to its latest financial record. This 0.8% rise comes despite aggressive repayment efforts and highlights the ongoing financial challenges facing the national carrier.
The debt increase was driven primarily by Sh7.50 billion in new loans from local banks, which offset the Sh5.02 billion in repayments made during the year. While the airline successfully reduced its aircraft lease liabilities by Sh4.70 billion and paid down Sh320 million in local bank loans, these efforts were not enough to prevent overall debt growth.
Accrued interest totalling Sh5.02 billion further compounded the airline’s financial pressures.
Government loans remain the largest component of the debt portfolio at Sh108.34 billion. Although the government provided temporary relief through a waiver and deferral on Sh8.4 billion of accrued interest, this support merely postpones rather than eliminates the airline’s obligations.
An additional Sh5.7 billion was withheld from available credit facilities specifically for debt service and lease restructuring, underscoring the delicate balance between meeting financial obligations and maintaining liquidity.
Currency fluctuations also played a significant role. Loans in US dollars fell to Sh32.73 billion from Sh36.47 billion, while those in Kenyan shillings rose to Sh110.06 billion from Sh105.24 billion. The net hedge effect stood at Sh4.73 billion in 2024—a major turnaround from the Sh898 million loss recorded in 2023. However, such gains may be temporary given Kenya’s volatile foreign exchange market.
Though the debt increase in 2024 was modest, it adds to years of accumulated liabilities that remain difficult to reverse. The government’s Sh96.90 billion ($750 million) sovereign guarantee offers short-term relief but underlines the airline’s dependence on public funds.
The coming year will be crucial in determining whether Kenya Airways can reduce its debt while remaining competitive in a tough aviation market.
