Wizz Air warns on profits amid price war and weather disruption
Low-cost European airline Wizz Air has warned over profits after suffering turbulence amid an intense price war and severe weather disruption.
Shares in the eastern and central European carrier, which is listed in London, nosedived by 8% after it said it would take a 10 million euro (£8.6 million) hit from weaker-than-expected air fares as lower fuel costs have helped airlines slash prices across the market.
But it said recent rises in fuel prices would cost it 5 million euros (£4.3 million), while it will also see a 5 million euro impact from weather disruption.
Wizz Air cut forecasts for full-year underlying net profits to between 225 million euros (£193 million) and 235 million euros (£201 million) from a previous forecast of 245 to 255 million euros (£210 million to £218 million).
Chief executive Jozsef Varadi said: "Although the current financial year is looking like a very good year for Wizz Air and we remain excited about our prospects for the next financial year, lower fuel prices continue to feed through to lower air fares, and this downward trend looks likely to continue well into 2017.
"Also, our operations this winter have been disrupted by unusually severe weather conditions in central and eastern Europe."
It is the latest alert from the airline sector after regional UK carrier Flybe reported a slow start to 2017 earlier this week, blaming "uncertain customer confidence and poor weather".
EasyJet last week revealed a further £35 million impact from the weak pound and fuel costs.
Wizz Air's full-year warning comes despite a 20.1% jump in the number of passengers carried, at 5.7 million in its third quarter to December 31.
Revenues in the quarter rose 9.9% to 341.1 million euros (£292 million) and pre-tax profit more than doubled to 33.1 million euros (£28.3 million).