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Kenya Airways...why ignore..
Rank: Member Joined: 5/30/2016 Posts: 332 Location: Kayole
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stock has been on upward trajectory this week. anyone know if the plane has lifted off or still pacing on runway to add some more KEGN, KPLC, KQ, SCOM
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Rank: Elder Joined: 6/23/2009 Posts: 14,217 Location: nairobi
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mkate_nusu wrote:stock has been on upward trajectory this week. anyone know if the plane has lifted off or still pacing on runway to add some more Price picking up with increased volume.. We haven't even started to taxii, plenty of room for more pax https://www.nse.co.ke/ma...tatistics&Itemid=190
KQ ABP 4.26
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Rank: Elder Joined: 6/23/2009 Posts: 14,217 Location: nairobi
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mkate_nusu wrote:Spikes wrote:obiero wrote:Mungu shuka chini.. Huu ndio mwaka yetu wa kuchota pesa Amen and amen Expecting good things Wait no more.. Look at what Michael Joseph has done http://www.businessdaily...808258-7c2fyv/index.html
KQ ABP 4.26
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Rank: Elder Joined: 6/23/2009 Posts: 14,217 Location: nairobi
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obiero wrote:obiero wrote:10+ reasons to believe in operation pride at KQ: 1. End of hedging policy 2. Cut off on HOTAC and other operational expenses 3. Rightsizing of the workforce 4. Fuel efficient planes 5. Route optimization especially in Africa 6. Category 1 status at main hub 7. GoK guaranteed debt at reduced pay out 8. Sale of non critical assets 9. Global reduction in fuel costs 10. Revival in KE tourism 11. Budget carrier for booming middle-class 12. Cleaned-up board and management 13. Debt tenor restructure by main bankers 14. Recent rate cap by GoK 15. Financial revamp by transaction advisers 16. Strong forex holding with primary pricing being USD  Profit trend (L/PBT) (KSh m) From 2003 to 2016 ascending: 547 2,075 5,520 6,960 5,975 6,526 −5,664 2,671 5,002 2,146 −10,826 −4,861 -29,710 -26,099 -3,311 Kenya Airways operating margin trend 2016 -3.5% 2015 -14.8% 2014 -2.2% 2013 -9.11% .. 2010 2.6% 2009 5.6% 2008 11.6% 2007 13.1% Point #16 is particularly pregnant seeing the current exchange rate on the green buck.. A godsend for KQ Wheelback.. Mtajiju
KQ ABP 4.26
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Rank: Member Joined: 5/29/2016 Posts: 898 Location: Nairobi
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obiero wrote:mkate_nusu wrote:Spikes wrote:[quote=obiero]Mungu shuka chini.. Huu ndio mwaka yetu wa kuchota pesa Amen and amen Expecting good things Wait no more.. Look at what Michael Joseph has done http://www.businessdaily...08258-7c2fyv/index.html[/quote] What we were saying here has come to pass. The boardroom is now with someone using common sense. One of the BIG blunders by Ngunze and Alex now out. There are more to come. I still repeat once again that what McKinsey has been purporting to be doing in KQ can be done by competent managers and staff. It was only Alex who was not able to do these things. They should not have been contracted before a forensic audit was commissioned. What @nzalela talks about here about ooooh Mckinsey's work is yielding fruits is the same language that Ngunze uses. Redundancies declared then suddenly followed by a 500+ recruitment exercise?
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Rank: Elder Joined: 6/23/2009 Posts: 14,217 Location: nairobi
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ArrestedDev wrote:obiero wrote:mkate_nusu wrote:Spikes wrote:[quote=obiero]Mungu shuka chini.. Huu ndio mwaka yetu wa kuchota pesa Amen and amen Expecting good things Wait no more.. Look at what Michael Joseph has done http://www.businessdaily...08258-7c2fyv/index.html[/quote] What we were saying here has come to pass. The boardroom is now with someone using common sense. One of the BIG blunders by Ngunze and Alex now out. There are more to come. I still repeat once again that what McKinsey has been purporting to be doing in KQ can be done by competent managers and staff. It was only Alex who was not able to do these things. They should not have been contracted before a forensic audit was commissioned. What @nzalela talks about here about ooooh Mckinsey's work is yielding fruits is the same language that Ngunze uses. Redundancies declared then suddenly followed by a 500+ recruitment exercise? I guess the only other convert we await shall be the nasty @vvs.. Operation Pride bearing fruit, now at 55% implementation
KQ ABP 4.26
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Rank: Member Joined: 5/29/2016 Posts: 898 Location: Nairobi
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@Nzalela, See my response in red. Let's not keep arguing for nothing. I hope KQ gets the right CEO very soon and some of these things will come to pass.
Okay these are the facts.
1. Despite reduction in capacity passenger numbers went up largely due to increased frequencies and aircraft utilization. – It is not true. There is demand out there especially destinations in Africa which are underserved by international carriers and KQ should be able to uplift more passengers and cargo across Africa. If KQ strikes a balance - gets the pricing well and capacity then it should not be struggling at this day and age. There is something that went wrong with the management of KQ.
2. With the embraer KQ can break even with average 50 pax depending on yield management strategy for the season. That is why KQ makes money mostly within 3 hours of Nairobi.[color=red] – KQ’s yield management strategy is poorly executed. They got it wrong with pricing due to loan obligations and other fixed costs. Lack of a strong oversight especially in procurement has led to a higher cost base for the Airline leading to unavoidable high ticket prices. The more flying hours the Embraer frame accumulates, the higher the maintenance costs. KQ’s maintenance costs have been rising yet the entire fleet is relatively new. The E190 jet compromises the ability for KQ to uplift more passengers during the high season as well loss of lucrative cargo revenue due to a smaller cargo belly.
3. Fast jet got knocked out because of competition. They were priced out by KQ who could afford to undercut for an extended period and passengers preferred the convenience of 5 flights to choose from. Fastjet is now replacing their Airbus A319 with embraer 190's. Same ones Kq is operating. – It is not true. Competition alone did not lead to the exit of Fastjet. Reasons are:
i). The uptake of the low cost air transport concept in Africa is still at its infancy stage.
ii). The no. of regional travellers are low and KQ normally supplement with connecting passengers and hence has a competitive advantage over Fastjet.
Fastjet’s replacement of A319 with E190 is again not just because KQ is operating it. The no. of passengers travelling intra-Africa are still very low and they cannot fill an A319. A start up airline in an environment with high aviation taxes coupled with low passenger numbers generally cannot compete with established carriers such as ET, KQ. DAR to NBO via ADD on ET in comparison to what Fastjet/ KQ were charging cannot deter a passenger from spending all the hours via ADD. Price is very key nowadays. This leads to my next counter argument on the choice of 5 flights that KQ offers. Sometimes, it is not only the convenience that the passenger looks at but the cost. Leisure travellers / Tourists can always plan their journey as per the cost effective flight. It is therefore not true at all to throw some words around without looking at the bigger picture/ reality.
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4. Mackenzie and operation pride has yielded so much savings for the airline it is actually very impressive. The amount of wastage, inefficiency, corruption and inflated costs was mind boggling. You will be shocked to learn that London is now at break even point and doing much better after the expensive slot time costs were done with. Operation costs upwards of 25B will be cut by full year and the company is now cashflow self sustaining. The huge debts however are a grave concern. – You are still wrong. I have said here and I will say again that what McKinsey have been doing at KQ could have been done by Ngunze and his directors. The forensic audit unearthed the theft and corruption and not McKinsey. Some issues had already been highlighted in the internal audit and it was only the inaction/incompetency on the part of management and to a large extent the board. Lack of strong internal controls led to the mismanagement. The same people who were entrusted to look after the Company looted it instead. The termination of McKinsey contract is a testament that the savings made from the initiatives alone cannot guarantee the full recovery of the Airline. I have already illustrated with the staff retrenchment that McKinsey is synonymous with, new staff recruitment is underway. What does the later mean for the bottom line? It is again back to the drawing board and hefty consultancy bills have been paid to them. It is always hard for some insiders to see the bigger picture in dire times.
Post here the LHR operating statement to substantiate your claims. How much does KLM charge KQ for the landing slot and what does that mean for the bottom line? BA could not have increased capacity on this route if KQ did not leave a gap. Emirates could not be fighting for a third frequency if KQ did not leave a gap on this gateway to Europe. Lufthansa could not have resumed NBO flights if KQ did not leave a big hole here. The moment KQ announced the phasing out of the B777 fleet then Lufthansa announced the resumption of NBO route.
The short turnaround which is now needed to operate this route will only continue when the B787 fleet is still new. The moment these jets start breaking down then the savings from parking/ crew layover will go down the trail in a single day. Mind you, I am very sure the savings from crew layover/ parking cannot even pay the cost of renting the landing slot from KLM.
5. Cargo in Kenya is a lemon if not well managed. The government has made JKIA a free cargo access market for all and sundry. That is why emirates can even do hops between Eldoret and Nairobi with a 777 cargo plane daily. Ethiopian market on the other hand is highly regulated and Ethiopian airlines enjoys cargo monopoly in the country. So it is not apples to apples. – Cargo is a very lucrative business for an Airline. If JKIA is a free for all then what about the other destinations in Africa where KQ’s ops are concentrated in? Why is ET uploading more Cargo in EBB yet KQ dominates that destination? It boils down to a wrong pricing strategy and lack of capacity.
I wouldn't buy the stock but the company is now finally on a positive path to recovery.
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Rank: Elder Joined: 6/23/2009 Posts: 14,217 Location: nairobi
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@arresteddev is the classic party pooper.. those who show up at a function just to take photos of the drunk party goer.. let's enjoy the KQ party in peace. As we head closer to March, expect renewed price discovery with target being KES 9
KQ ABP 4.26
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Rank: Veteran Joined: 8/28/2015 Posts: 1,247
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obiero wrote:@arresteddev is the classic party pooper.. those who show up at a function just to take photos of the drunk party goer.. let's enjoy the KQ party in peace. As we head closer to March, expect renewed price discovery with target being KES 9 I like being basic, simple and petty. How many times did mj have to visit state house (except in this case probably to pledge allegiance to njupilee and promise to fund the road show trains) when he was riding the green monster that rose him to Echelon's. None. So hapa wacha watu wapakwe mafuta na tako bali na sako la chupa. Kila mtu huwa kwa meza kwa minajili fulani. Kukula mnofu, kukula kwa macho ama kuliwa ukiwa mnofu. Hapa naona mnofu tu ikikaangwa. Wenye kula wanangoja tu kaive ndugu na dada.  tahadhari usiwe kitoweo. @obiero mbona wahesabu kura kabla ya kupigwa.  ,Behold, a sower went forth to sow;....
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Rank: Elder Joined: 6/23/2009 Posts: 14,217 Location: nairobi
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Weka pesa hapa si mashairi.. Hehe
KQ ABP 4.26
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