UPDATE 2-Umeco H1 operating profit from continuing ops falls

* Says confident that long-term prospects are robust

* Maintains interim dividend at 6.5 p/shr

* Cuts debt to 90.6 mln stg; says debt may rise in H2

* Says confident of meeting analyst estimates for FY

* Shares rise 5.8 pct (Adds CEO and analyst comments, share price)

BANGALORE, Nov 4 (Reuters) - British aerospace parts supplier Umeco Plc on Wednesday reported a 15.9 percent fall in first-half operating profit from continuing operations due to lower demand, but said it was confident that its long-term prospects are robust.

Shares of the company, which also makes composite materials for Formula One racing cars, were up 5.8 percent at 273.25 pence at 1350 GMT.

Umeco (LSE: UMC.L - news) said it continued to cut costs and reduced its net debt to 90.6 million pounds ($148.8 million) at Sept. 30 from 120.2 million pounds at March 31.

However, debt levels may increase in the second half due to an expected rise in capital expenditure and the payment of both the interim dividend and final dividend towards the end of the year, according to a top company official.

"The guidance we have provided this morning is that net debt, assuming exchange rates don't vary, will be between 95 (million pounds) and 100 million pounds by the end of March next year," Chief Executive Clive Snowdon told Reuters.

Snowdon also said he was confident of meeting analysts' estimates of a full-year reported profit before tax of 23.5 million pounds on revenue of 414 million pounds. The company said the civil aircraft backlog for its supply chain business remained high and its composites unit was likely to benefit from delayed motor sport orders and a recovery in the wind market in the second half.

Umeco maintained its interim dividend at 6.5 pence per share.

"The strong progress on working capital reduction in the first half eases our balance sheet concerns a little. Nevertheless... we still cannot rule out either a dividend cut nor a fundraising," KBC Peel Hunt analyst Dominic Convey said in a note.

The brokerage raised its target price on the stock to 220 pence from 150 pence to reflect the sector rerating in recent months. Umeco, which has world champion Lewis Hamilton's Vodafone (LSE: VOD.L - news) -sponsored McLaren Mercedes Formula 1 team as a customer, reported an operating profit from continuing operations of 13.2 million pounds for the six months ended Sept. 30, compared with 15.7 million pounds a year earlier.

Adjusted pretax profit fell 27.7 percent to 9.4 million pounds. Revenue rose 1.2 percent to 199.6 million pounds. ($1=.6088 Pound) (Editing by Maju Samuel)