UPDATE 2-CME sees challenging H2 after Q2 revenue up

                                
 * Q2 revenue up 10 pct to $201.7 mln vs $190.2 mln in poll
                                
 * EBITDA $46.2 mln vs $42.4 mln in Reuters poll
                                
 * Net profit $165.2 mln due to Ukraine sale
                                
 * CEO says H2 to be challenging
                                
 * Shares rise more than 3 pct, outperform Prague index
                                
 
 (Adds share reaction, analyst)
                                
 PRAGUE, July 28 (Reuters) - Broadcaster Central European
Media Enterprises (CME) said the second half would be tough
after posing a rise in second-quarter revenue as the acquisition
of a Bulgarian TV station offset falling ad income.
                                
 Chief Executive Adrian Sarbu said only the company's Czech
and Slovene markets had started to recover but he was
optimistic.
                                
 "The second half will be challenging but our continuing
audience leadership uniquely positions us to take advantage of
any improvements in our markets," he said in a statement.
                                
 CME, partly owned by Time Warner <TWX.N> and U.S. investor
Ronald Lauder, battled a 30 percent decline in spending on TV
ads in 2009 in its once-booming markets. It has said ad spending
would not return to pre-crisis levels until 2012.
                                
 CME said in May recovery in its six central and eastern
European markets was more fragile than expected, but that it
still expected overall growth in ad spending in the final six
months of 2010. [ID:nLDE65T1K7]
                                
 CME has full-year guidance on revenue for at least $790
million and EBITDA of at least $140 million, up from $714
million and $75 million in 2009. 
                                
 But analysts said the U.S. dollar's appreciation this year
and the weak ad markets may push the company to miss guidance.
                                
 "We still see a relatively high probability of slightly
lower FY guidance after the 2Q10 results, with negative
implications for the share price in the short term," Ceska
Sporitelna analyst Vaclav Kminek said in a note.
                                
 Second-quarter revenue rose 10.3 percent to $201.7 million,
beating an beating the average estimate of $190.2 million in a
Reuters poll.
                                
 CME, whose Czech and Romanian markets are its biggest,
completed the $413 million buy of Bulgaria's bTV in April, which
helped it to overcome a 4 percent decline in TV ad spending.
                                
 Earnings before interest, tax, depreciation and amortisation
(EBITDA) was $46.2 million, up from $45.8 million last year and
better than a mean average of $42.4 mln in a Reuters poll
                                
 Profits were hurt by unfavourable currency developments in
CME's markets but a $217.6 million gain from the sale of
Ukrainian operations during the quarter stopped it from falling
to a loss.
                                
 It had a net profit of $165.2 million, up from $24.1 million
the previous year and compared with estimates from analysts that
ranged from a net loss of 11.1 million and a net profit of $289
million.
                                
 CME shares <CETVsp.PR> <CETV.O> rose 3.2 percent in early
trade in Prague, more than a 0.5 percent gain in the index
<.PX>.
                                
 CME shares are up 0.7 percent so far in 2010, below a 6.9
percent rise in Prague's main index <.PX>.
 (Reporting by Jason Hovet; editing by Michael Shields and Karen
Foster)
                                
 The company will hold a conference call at 1300 GMT.