Kenya Airways -- Consolidated Balance Sheet

(in millions of Kenyan shillings)
as of 30 Sept. '95
Current assets 4,696.2
Deposits 129.9
Deferred assets 6.6
Investments 2.0
Fixed assets -- book values (cf. audited values) 1,855.6
Current liabilities 3,428.4
Capital reserve 256.7
Long term loans 866.0
Share capital 2,308.1
Accumulated losses -168.9
Source: Kenya Airways Prospectus, March 1996

The above consolidated balance sheet was for Kenya Airways and its wholly owned subsidiaries, Kenya Airfreight Handling Ltd. and Kenya Flamingo Airways Ltd., as of 30 September 1995.  This Group will be referred to below simply as Kenya Airways.  The total number of shares in issue was 461,615,484.  The book value (assets minus current liabilities) as of 30 September 1995 was KShs. 2,396 million, or about US$44.4 million.   The book value of net assets per share was KSh. 5.19.

The audited value of the fixed assets was KShs. 5,072 million greater than book value.  If this surplus were included, the adjusted pro-forma net assets of Kenya Airways would be KShs. 7,468 million, or about US$124 million.  Net assets per share would be KShs. 16.18.  These pro-forma values do not reflect any liability to taxation or deduction for sales costs which would arise on the disposal of assets at the valuations given.

The above balance sheet shows a debt/equity ratio for Kenya Airways of 0.38.  The debt/equity ratio is an indicator of financial leverage.  A higher debt equity ratio indicates greater financial leverage. The table below shows debt/equity ratios for selected other airlines for the fiscal year 1995. The (value-weighted) average debt/equity ratio for all U.S. manufacturing corporations in 1995 was 0.64.

Airline Debt/Equity Ratio
Air France  5.24
Air Madagascar 1.96
British Airways  17.64
Delta AirLines  18.10
Egyptair 1.98
Japan Airlines  3.76
Singapore Airlines  0.34
Source: ICAO Financial Data 1995, Series F-No. 49.

Kenya Airways' balance sheet also shows a current ratio (current assets to current liabilities) of 1.37. The current ratio is an indicator of liquidity. A higher current ratio indicates greater liquidity. The table below shows current ratios for selected airlines. The (value-weighted) average current ratio for all U.S. manufacturing corporations in 1995 was 1.40.

Airline Current Ratio
Air France  0.95
Air Madagascar 2.95
British Airways  1.24
Delta AirLines  1.17
Egyptair 4148.00
Japan Airlines  0.97
Singapore Airlines  0.87
Source: ICAO Financial Data 1995, Series F-No. 49.

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