Kenya Airways CEO Sebastian Mikosz Announces His Resignation

Kenya Airways CEO Sebastian Mikosz could resign before the end of his term at the helm of the national carrier.

In a memo sent to staffers of the cash strapped airline, Mikosz announced that he would step down at the end of this year without stating the reasons of his decision.

“I have made the decision to shorten my contract term and I have decided to resign on personal grounds effective Dec. 31,” read the memo in part.

Bloomberg reports that the Board of the troubled airline has agreed to Mikosz resignation, and will start recruitment process soon to hire his replacement.

Kenya Airways is 48.9% owned by the Kenyan government, which increased its stake as part of a bailout plan in 2016. Air-France KLM is a minority shareholder. The shares rose 5.2% to 3.63 shillings in Nairobi on Friday, valuing the carrier at 5.4 billion shillings.

Kenya Airways recorded a 17.76 rise of its losses to Ksh7.59 billion for full year 2018, from Ksh6.41 billion loss made in the nine month period ended in December 2017.

Read: Fuel Costs, Ballooning Wages To Blame For KQ Ksh7.5 Billion Loss – Mikosz

The national carrier attributed the loss to high cost of fuel, high salaries and fleet ownership cost.

According to the outgoing CEO Mikosz, high cost of fuel, high salaries and fleet ownership cost accounted for nearly two thirds of the its operating costs.

“Fuel is our greatest challenge and this will be for a while, oil prices are up by 30 percent. Fuel represents over 40 percent of our direct operating costs .We started mitigating this risk by implementing a new hedging policy with minimal risk,” said Mikosz.

However, the carrier reported growth in passenger numbers, which resulted in revenue growth of 41.3 percent to Ksh114.2 million. It also recorded a 52.3 percent growth in cargo revenue to Ksh8.68 billion.

KQ has battling with more than 20 foreign airlines that operate out of JKIA, including RwandAir, KLM, Swiss Air, Air France, Qatar, Turkish Airlines, and Air Mauritius.

Others are British Airways, Emirates, South African Airways, Air Saudi, and Ethiopian Airlines.

The company has been experiencing a bumpy flight following years of loss-making.

In a turn-around formulae, the company was planning to take over operations at the Jomo Kenyatta International Airport (JKIA) but the plans failed after a public outcry.