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Its shares plunged as much as 11 percent after
the statement on Wednesday, heading for the biggest one-day drop
since 2001.
Europe's largest airline by revenue said it now expects 2014
operating profit of 1 billion euros ($1.4 billion), against a
previous forecast of 1.3-1.5 billion. It also reduced its 2015
earnings target to 2 billion euros from 2.65 billion.
"The revenue risks mentioned when we presented the quarterly
figures in early May have unfortunately materialized," Chief
Financial Officer Simone Menne said.
In May it said market conditions were tough and that yields - a
measure of revenue per passenger - were coming under pressure at
its Frankfurt and Munich hubs.
Menne said on Wednesday that prices on European and U.S. routes
were under pressure due to more seats being offered by rivals,
such as those from the Gulf region.
Lufthansa has long been a critic of airlines such as Emirates [EMIRA.UL],
Qatar Airways and Etihad, which it says enjoy competitive
advantages because they are state-owned.
The profit warning comes just over a month into the tenure of
new chief executive Carsten Spohr.
He will present details of further restructuring measures in
July, the company said.
Lufthansa will also "noticeably" reduce the number of seats it
offers over the winter, Menne said.
The company said three-day pilot strikes in April had wiped 60
million euros off its profit for the year, while currency
restrictions in Venezuela preventing airlines from repatriating
revenues from ticket sales there had lowered results by a
further 60 million euros.
(Reporting by Victoria Bryan; Editing by Ludwig Burger and Jason
Neely)
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