Aug 1 (Reuters) -

Wizz Air ( WZZAF ) lowered its annual profit forecast on

Thursday after reporting a 44% drop in its first-quarter

operating profit, partly due to costs related to Pratt &

Whitney's engine troubles and one-off wet leases to

bolster capacity.

The shares tumbled 13.6% by 0709 GMT.

The low-cost airline, which flies an all-Airbus fleet, has

faced challenges related to Pratt and Whitney RTX engines, with

46 of its planes set to be grounded for inspections this summer,

placing constraints on capacity.

European airlines have faced a difficult first half of the

year because of spiralling costs and as customer demand

normalised following a post-pandemic boom. Air France-KLM

, Lufthansa and Ryanair all reported

challenging second quarters.

Chief Executive Jozsef Varadi said the airline will have to

moderate its expectations.

"Our fares are still improving, but our competitors are

dropping theirs and that impacts us," Varadi said.

The budget carrier forecast net income for the year in the

range of 350 million euros to 450 million euros ($379 million

-$487 million), from an earlier forecast of 500 million euros to

600 million euros.

Operating profit in the company's first quarter to June 30

was 44.6 million euros, against the 144.3 million-euro consensus

in an LSEG analyst poll.

MOVING FORWARD

Wizz Air ( WZZAF ) said demand remained strong and that it still

planned substantial capacity growth in coming years, with new

Airbus planes boosting its fleet.

The aviation sector has struggled with delays from plane

manufacturers Boeing ( BA ) and Airbus in the years since the

COVID-19 pandemic, with constraints at Boeing ( BA ) compounded by

ongoing safety concerns.

Airbus warned of further delivery delays in June and

said it faced supply chain challenges.

"We remain on track to return to annual capacity growth in

2026, underpinned by the pipeline of Airbus deliveries," Varadi

said in a statement.

However, issues with Pratt & Whitney engines remained

"unpredictable", and wet leases to protect Wizz Air's ( WZZAF ) routes and

capacity led to a cost hit this quarter and will spill over into

the second quarter.

($1 = 0.9239 euros)