Aer Lingus cuts profit forecast citing fierce competition

Reuters

DUBLIN (Reuters) - Irish airline Aer Lingus (ISE:EIL1) cut its profit forecast for the year by 13 percent on Friday citing intense competition in European short-haul markets days after rival Ryanair also warned on profits.

Aer Lingus expects profits for the full year to be around 60 million euros (50.45 million pounds), it said in a statement, down from a forecast of 69 million euros it made at the end of July.

At the time Aer Lingus reported weak bookings in July and August due to unusually warm weather in Ireland, but said it hoped to make up for that in the remaining months of the year.

"The current booking profile for the rest of the year suggests that despite more aggressive pricing in response to market conditions, it will not be possible to recover lost volumes," Aer Lingus said on Friday.

Aer Lingus said pricing environment was intensely competitive.

The airline plans to cut short-haul capacity by at least 3 percent in the final three months of the year. It said long-haul bookings for the remainder of 2013 are ahead of last year.

Aer Lingus is looking to accelerate existing plans to cut costs, the statement said.

Aer Lingus shares were down 5.7 percent at 1.49 euros at 0828 GMT compared to a fall of 1.7 percent on the Thomson Reuters European Airlines Index (.TRXFLDEUPUARLI)

(Reporting by Conor Humphries. Editing by Jane Merriman)