Shares in Hungarian budget airline Wizz Air (LSE: WIZZ) fell over 4% early on Thursday after the carrier swung to a loss in its fiscal third quarter, impacted by reduced capacity and higher costs related to flight disruptions in the Middle East.

Although revenue rose 17% and passenger numbers were up 22% in the quarter, Wizz reported a pretax loss of €118.4 million compared to a €36.4 million profit last year as total operating expenses climbed 17%. The airline said it was forced to cancel around 6% of its planned capacity due to flight restrictions, leading to a wider operating loss of €180.4 million.

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“We have worked hard to adjust the schedule in line with updated capacity projections, focusing on seasonality and markets with the greatest potential,” said CEO Jozsef Varadi. He added that early fourth-quarter trading has been positive even as Wizz Air braces for further aircraft groundings.

Over the past 12 months, Wizz Air shares have dropped 35.5%.