(Adds figures, CEO comments, background)
Oct 26 (Reuters) - Australia's Qantas Airways Ltd QAN.AX forecast higher underlying first-half profit on Thursday as it cut capacity and raised fares, although expectations of slower revenue growth pushed its shares down as much as 7 percent.
Qantas said it expects to report underlying profit before tax in the range of A$900 million ($693 million) to A$950 million for the six months to Dec. 31, compared with A$852 million recorded a year earlier.
Revenue for the first quarter ended Sept. 30 rose 5.1 percent to A$4.19 billion.
"The domestic market is healthy but remains very competitive," Chief Executive Alan Joyce said in a statement. "The high rate of revenue growth we've seen so far this year is likely to slow when compared with what was a strong second half last year."
Qantas shares dropped at the open after the trading update before recovering some ground to be 4 percent lower at A$6.14. The carrier's shares have surged more than 90 percent so far this year.
Domestic revenue per available seat kilometre (RASK), a measure that combines ticket prices and seats filled, jumped 8 percent in the quarter. International revenue rose just 0.2 percent in the quarter ended Sept. 30, compared with a 6.9 percent decrease in the year-ago quarter.
The airline reported a near-record annual profit in August while also announcing a new cost-cutting target of A$400 million in savings each year. = 1.2984 Australian dollars)