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Kenya Airways tumbles

Dec 04 2012 19:14 Reuters

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SHARES in Kenya Airways sunk 9.5% to an 8 1/2-year low of 10.50 shillings after a court ordered the airline reinstate more than 400 workers laid off earlier this year as part of cost cuts.

Kenya Airways says it will obey the ruling, which analysts said will squeeze profit margins badly.

"(The court order) puts investors in a difficult position because its difficult to know when profitability will be attained," says Eric Musau, a research analyst at Standard Investment Bank, adding that the high costs were unsustainable.

The airline swung into a pre-tax loss in the first half of this financial year.
kenya airways  |  kenya

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