The Committee on Commissions, Statutory Authorities, and State Enterprises (COSASE) has released a report on Uganda Airlines, revealing a complex financial landscape. Despite incurring a staggering net loss of Shs 237.9 billion in the 2023-2024 financial year, the airline’s revenues increased by over 50% compared to the previous year.
The report, presented by Busiro East MP Medard Ssegona, underscores the airline’s potential for significant investment, contingent upon strategic reforms. Notably, passenger revenue surged by 58%, cargo revenue by 55%, and excess baggage fees by 63%. These figures indicate a robust demand for Uganda Airlines’ services, according to committee chairperson Medard Lubega Sseggona.
Despite the promising revenue growth, the report reveals ongoing challenges. The government has invested a total of Shs 1.87 trillion into the airline since its revival, leading to accumulated losses of Shs 1.02 trillion. However, the committee emphasized that with effective management, Uganda Airlines could transform into a profitable national asset.
The committee highlighted Uganda Airlines’ unique advantage as the national carrier, providing direct connections to key destinations in Africa and beyond. The report also pointed out the potential for new routes to Johannesburg, Riyadh, and Accra, which, although delayed due to budget constraints, could offer critical investment opportunities.
To enhance profitability, the committee made several recommendations:
Review Business Model: An urgent reassessment of the airline’s business strategy is necessary.
Leasing Aircraft: Prioritizing aircraft leasing over outright purchases could reduce financial strain.
-Code-Sharing Agreements: Exploring partnerships with established carriers could enhance service offerings and profitability.
Targeted Funding: The government should consider funding initiatives that support profitable routes and cargo operations directly.
The COSASE report paints a picture of a struggling but potentially viable airline. With strategic reforms and targeted investments, Uganda Airlines could not only recover from its financial setbacks but also emerge as a key player in the aviation industry.
The committee’s findings will be crucial as parliament considers the future of Uganda Airlines and its role in the national economy.
