Uganda Airlines has turned in a UGX102.4 billion ($27.4 million) post-tax loss for its most recent financial year, after falling far short of revenue projections.
The auditor general has revealed the figure in a newly-released submission to Parliament on the financial performance of 13 state enterprises in the year to 30 June 2020.
Seven of the 13 entities suffered performance reductions as a result of the pandemic, the auditor general says, and Uganda Airlines was the worst-performing of the five entities which generated a loss.
“The company was unable to realise its planned revenue, yet the expenditure on operations was way above projected costs,” its analysis found.
Uganda Airlines generated revenues of $9.98 million, just over 10% of the expected $92.8 million, but spent $29.2 million on direct costs and another $3.6 million on indirect costs.
Its loss for the previous year, 2018-19, is given as UGX.15.3 billion.
The analysis says progress with the business plan was “difficult” to evaluate and it was “not implemented in accordance with the planned timelines”.
It states that the government invested a total of UGX934.8 billion but only UGX200 million is listed as share capital in the company’s statements, the rest shown instead as share application funds.
“The processes for recognition of the government investment in the company have not been undertaken to enable appropriate treatment and reporting in the company’s books of account,” it adds.
Uganda Airlines says it recently met with parliamentarians on the infrastructure, finance and budget committees and updated members on its activities and plans.
“The legislators commended the airline for the progress made and pledged all the necessary support to the national carrier,” it states.
Uganda Airlines reinforced its fleet at the end of 2020 with the delivery of its first Airbus A330-800, which has been undergoing a certification process with the country’s civil aviation authority.
Once its operation is approved, the carrier says it intends to put the twinjet into operation on services to London, Dubai, Guangzhou and Mumbai from Entebbe.
It says it has “successfully obtained” landing slots at London Heathrow and Dubai, adding: “Dates for the start of operations to each destination will be announced soon.”