* Q3 EBIT rises 2 pct to DKK 347 mln, below 351 mln forecast
* Company raises 2008-09 margin view, trims revenue target
* CEO says sees stabilisation in Germany after troubles
* Shares fall 0.9 pct
(Adds executive quotes; updates share price to close)
By Henriette Jacobsen and John Acher
COPENHAGEN, Aug 14 (Reuters) - Danish healthcare products maker Coloplast posted a 2 percent rise in operating profits for the third quarter, roughly in line with forecasts, and slightly upgraded its guidance for full-year margins.
Earnings before interest and tax (EBIT) rose to 347 million Danish crowns ($66.54 million) in the third quarter of Coloplast's 2008-09 fiscal year, from 341 million in the same quarter last year, the company said on Friday.
The result for the medical supplies producer missed an average expectation of a rise to 351 million in a Reuters survey of eight analysts, but came within the range of estimates of 313 million to 380 million crowns.
"It landed on both ours and the market's expectations," Alm. Brand analyst Michael Jorgensen said. "So a quite stable earnings report. The topline growth is still a little weak, but they compensate for this with cost reductions."
Coloplast shares closed down 0.9 percent at 386 crowns, against a 0.7 percent rise in the Copenhagen bourse's blue-chip index.
Coloplast, which makes products ranging from continence bags to wound dressings, nudged up its full-year 2008-09 guidance for its operating profit margin in Danish crown terms to 15 to 16 percent from an earlier projection of around 15 percent.
However, it trimmed its full-year 2008-09 forecast for organic revenue growth in Danish crowns to around 5 percent from an earlier projection of around 6 percent.
PULLS PLUG ON BUYBACK
Coloplast said it would not complete the second half of a 1 billion crown share buyback programme planned for 2009 because it wanted to strengthen its capital reserves at a time when the financial markets are unfavourable.
"The main reason for (cancelling the buyback) is our own wish to improve our capital reserves to participate in potential acquisitions should the right one be available to us," Chief Executive Lars Rasmussen told analysts in a conference call.
Chief Financial Officer Lene Skole said Coloplast did not have any particular acquisition on its radar but was looking at opportunities within its core business areas.
She said it made sense to cancel the buyback to gain financial flexibility because the credit markets remain tight.
Coloplast cut its 2008-09 capital expenditure plan to 600 million crowns from an earlier 700 million.
Third-quarter revenues grew 4 percent year-on-year to 2.24 billion crowns, missing an average estimate of a rise to 2.27 billion in the Reuters poll.
"Growth rates are still being impacted by the problems experienced by our German subsidiary," Coloplast said. The German business has been hurt by healthcare reforms that brought competitive tendering and new payment methods.
"Stabilisation has begun in Germany, now we need growth and it will come during the next couple of years," Rasmussen said.
Coloplast said it was continuing to pursue plans that have existed since 2001 to shift production to Hungary and China from Denmark and consolidate Danish production in fewer units.
In line with earlier announcements, a factory at Espergaerde, Denmark, will be closed and some production at Thisted, Denmark, will be relocated to Hungary, it said. ($1=5.215 Danish Crown) (Additional reporting by Teis Jensen; editing by Rupert Winchester and Simon Jessop)