April 26, 2018 / 5:37 AM / a year ago

Eurowings expansion holds back Lufthansa Q1 profit

BERLIN, April 26 (Reuters) - German airline Lufthansa said costs to expand its Eurowings budget carrier held back profit growth in the first quarter of the year, and it lowered its forecast for 2018 capacity growth.

Lufthansa on Thursday reported a slight rise in adjusted earnings before interest and tax (EBIT) to 26 million euros ($32 million), far short of the 81.3 million euros forecast by analysts in a Reuters poll.

Lufthansa is rapidly growing its Eurowings brand to fill the gap left by the collapse of Air Berlin.

Lufthansa said one-off costs from integrating parts of Air Berlin pushed Eurowings to an adjusted loss of 203 million euros in the first-quarter and said one-off expenses will continue to weigh in coming months.

It also lowered its guidance for total capacity growth to 8.5 percent from its previous forecast of 9.5 percent. ($1 = 0.8214 euros) (Reporting by Caroline Copley and Victoria Bryan Editing by Maria Sheahan)

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