* Q2 EBITDA 84.4 million euros, vs 68 million f'cast
* New debt covenants give greater debt flexibility
* CEO says expects H2 to see more moderate revenue
* Shares rise above 16 percent, highest since March 2008
(Adds more CEO comment from news conference, share rise)
By Sylvia Westall
VIENNA, Aug 18 (Reuters) - Wienerberger the world's top brickmaker, on Tuesday beat forecasts with a smaller-than-expected earnings drop and a new deal with creditor banks calmed fears of a rights issue, causing shares to rocket.
The Austrian company, which has suffered badly from the global slump in residential construction, said second-quarter core earnings dropped 41 percent, less than the 52 percent analysts were bracing for.
New Chief Executive Heimo Scheuch, who took the helm on Aug. 1 after long-time boss Wolfgang Reithofer retired, said he expected the second half to show a more moderate decline than the first, but it was too early to speak of recovery.
"After the years of growth we now have the chance to sort out our homework, concentrating on our markets and putting ourselves in a better position," he told a news conference.
Chief Financial Officer Willy van Riet said Wienerberger was unlikely to make up the first-half net loss of 219 million euros ($309.6 million) in the second half of the year. All analysts in the Reuters poll expect a full-year net loss.
The group, which restructured some of its debt earlier this year, also said it had agreed on new debt covenants, giving it more room to navigate through the crisis without having to ask shareholders for fresh cash.
Wienerberger shares soared, rising as much as 16.7 percent to 14.10 euros, their highest since March 2008 and the biggest gainer in the DJ Stoxx Construction and Materials index. They were up 12.75 percent at 13.62 by 1134 GMT.
"We regard Wienerberger as an excellent company that has been in very tough markets. However, it looks like it has now turned a corner," Davy Research analyst Tim Cahill said.
Wienerberger has suffered the force of the housing collapse, especially in Britain, the United States and emerging Europe. Unlike rivals, including Holcim and HeidelbergCement, it has not benefitted from stimulus measures as it has little exposure to civil engineering projects.
COST CUTS
Earnings before interest, tax, depreciation and amortisation (EBITDA) fell to 84 million euros in the quarter.
The central Europe and Germany business, which brings in about half of the group's revenue, had better results than expected.
Central Europe posted a 48 percent year-on-year fall in EBITDA to 39.1 million euros, compared with a mean estimate of 33.8 million in a Reuters poll, while Germany saw a 13 percent fall to 16.9 million, compared with a mean estimate of 10.0 million.
The United States segment turned in a loss even with group's EBITDA level but it only makes up around 10 percent of sales.
The group also booked restructuring costs of 59 million euros and 125 million euros in goodwill impairments. CEO Scheuch said he did not expect more impairments in the second half.
"Given the restructuring measures and goodwill amortisation there is only limited potential for further negative surprises in the second half and beyond," UniCredit analyst Peter Bauernfried said in a note.
The group said there was no turnaround visible yet in its eastern European markets. But it said the downward trend was slowing in continental Europe while there was a sign markets were bottoming out in North America and Britain.
Wienerberger, which had its debt ratings downgraded in June by Moody's and Standard & Poor's, reiterated that it planned to reduce debt to about 790 million euros by year-end in spite of a seasonal surge in its debt level during the second quarter.
However, the new debt covenants allow the group's debt to grow to as much as 3.75 times EBITDA, from the previous limit of 3 times, a ratio that analysts said makes the group unlikely to issue new shares soon.
Wienerberger promised 150 million euros of cost cuts this year. It already shuttered 18 plants and cut 1,000 jobs in 2009. Scheuch said he expected all the planned cost-cutting measures to be completed this year. ($1=.7074 Euro) (Additional reporting by Eva Komarek and Boris Groendahl; editing by Karen Foster)