* Full-year profit guidance cut, Q3 disappoints
* Sterling drop hits revenue
* Airline ramps up expansion plans (Adds detail, interview quotes, analyst comment)
By Alistair Smout
LONDON, Feb 1 (Reuters) - Eastern European-focused Wizz Air cut its full-year profit estimate on Wednesday, citingpressure on fares in the industry, and said it would press aheadwith plans to expand aggressively to build market share.
Wizz Air's London-listed shares fell more than 8 percent,their steepest decline since the aftermath of Britain's vote toleave the European Union last June, having been more resilientthan rivals over the last year.
The group has felt the effects of pricing pressures afterlarger low-cost rivals easyJet and Ryanair putmore seats on to the market to take advantage of previously lowoil prices and to try to capture market share.
Both Lufthansa and Ryanair have said they expect fares tofall again this year, although they have predicted the drop willbe less steep as oil prices creep back up.
Wizz Air, which has its headquarters in Budapest, loweredits underlying net profit guidance to a range of between 225million euros and 235 million euros for the year to the end ofMarch, from a previous forecast of 245 to 255 million euros.
Underlying net profit for the third quarter was 13.5 millioneuros ($14.6 million), a year on year decrease of 21.5 percent,which broker Goodbody described as "disappointing".
The firm said around half of the cut to the profit forecastwas due to the low fare environment, as a result of acombination of industry overcapacity and weakness in sterling.
Rising fuel costs and disruptions because of severe weatheralso dented the outlook, echoing an update from Flybe earlier in the week.
Unlike most of its rivals, Wizz Air did not downgrade itsprofit forecasts in the wake of last year's Brexit vote, and ithas outperformed since the start of 2016. http://reut.rs/2kfQzMM
However, while it has limited exposure to Britain, a 15percent slump in sterling has hit Wizz Air's revenues, as itreports results in euros.
The airline is continuing to expand and started 26 newroutes over the previous three months. It is expecting todeliver full-year capacity growth of 20 percent.
"We are taking advantage of the low-fare environment, and weare growing more aggressively than planned before," ChiefExecutive József Váradi told Reuters.
"I think our competitors are affected in a much bigger way,and I think this is why this is right for us to take advantage."
WizzAir flew 22.7 million passengers in 2016, compared with117 million reported by Ryanair, which overtook Lufthansa asEurope's biggest airline by passenger numbers..
($1 = 0.9273 euros)
(Reporting by Alistair Smout; Editing by Keith Weir)
