LONDON (Reuters) - British low cost carrier easyJet (>> easyJet plc) upgraded first-half forecasts, saying favourable currency moves would boost its bottom line, but said if current exchange rates stuck, they would provide a reverse effect over the year.

The group, which like rivals traditionally makes a loss over the winter when fewer customers fly, said on Thursday that it could swing to a profit for the six months to March 31, a significant improvement on last year.

"easyJet continues to be well positioned to deliver sustainable returns to shareholders due to its compelling network, low cost base and strong balance sheet," chief executive Carolyn McCall said in a statement.

The company, Europe's No. 2 low-cost carrier behind Ryanair (>> Ryanair Holdings plc), said it expected to report between a loss of 5 million pounds and a profit of 10 million pounds for its first-half, compared to guidance given in January for a loss of between 10 million pounds and 30 million pounds.

That compares to the 53 million pound loss it reported in the same period last year.

The weakening of the euro against the pound was the main boost to its bottom line in the second quarter, it said.

It warned, however, that if those same exchange rates were maintained across the full-year period, there would be a 20 million pound adverse impact due to swing in costs and revenues received in pounds and euros at different times of the year.

easyJet also maintained its plan to grow capacity by 5 percent over the current financial year, even as it faces renewed competition from its Irish rival Ryanair after it improved its customer service and started adding more main city airports to its routes.

It is due to publish its first-half results on May 12.

(Reporting by Sarah Young; Editing by Neil Maidment)

Stocks treated in this article : Ryanair Holdings plc, easyJet plc