By Uganda National Airlines Company Limited, the operator of Uganda Airlines, has significantly reduced its losses, achieving a 26.5% improvement in the 2023/24 financial year, according to the Auditor General’s annual report for the year ending December 31, 2024.
The report, authored by Auditor General Edward Akol, highlights that although the airline’s operating margin remains below 15%, it showed an 18% improvement compared to the previous year. This progress places Uganda Airlines in a better position to meet its operational costs and move toward profitability.
However, the national carrier still faces financial hurdles, ranking among the five state enterprises with the poorest return on assets—below 5%. Additionally, the report flagged concerns about the ratio of current assets to current liabilities, which remains below 1.5, suggesting potential difficulties in meeting short-term financial obligations.
The airline recorded a net loss of Shs237.8 billion in 2024, a significant reduction of Shs87.1 billion (25.6%) from the Shs324.9 billion loss reported in 2023. Despite this improvement, Uganda Airlines continues to grapple with sustained losses since its revival in 2019, following its liquidation in 2000.
The report underscores the financial trajectory of Uganda Airlines, noting a loss of Shs164.5 billion in June 2021—an increase of Shs62.1 billion from the Shs102.4 billion loss reported in the 2019/20 financial year. Losses further escalated to Shs266 billion in June 2022 and peaked at Shs325 billion in June 2023, attributed to a Shs140.8 billion rise in direct costs.
Despite these setbacks, the airline recorded a substantial increase in operating revenue in 2024, which rose to Shs369.7 billion from Shs230.4 billion in 2023—a growth of Shs139.3 billion.
In a bid to address its financial challenges, Uganda Airlines is developing a new 10-year strategic plan aimed at ensuring financial sustainability, operational efficiency, and better stakeholder engagement. The strategy will focus on revenue enhancement, cost control, and improved operational performance.
The report also flagged several issues, including Shs11.9 billion in contingent liabilities from unresolved court cases, delays in project implementation, and incomplete adherence to Parliamentary recommendations. Out of 19 assessed outputs comprising 53 activities valued at Shs456.2 billion, only five activities worth Shs269.8 billion were fully implemented, while 26 activities worth Shs96.6 billion were partially executed, and 22 activities worth Shs89.8 billion were not implemented.
Furthermore, the Auditor General noted a compliance rate of 66.7% for Parliamentary recommendations from the 2020/21 financial year, with 12 out of 18 fully implemented and six partially executed.
Despite these challenges, the government has reiterated its expectation that Uganda Airlines will break even within five years of operation. The recent reduction in losses and growth in revenue are encouraging signs, but sustained efforts in financial discipline, strategy execution, and operational efficiency will be critical to achieving long-term success.
