UPDATE 2-Victrex H1 profits flat, confident about 2008

(Adds detail, company, analyst comment)

LONDON May 20 (Reuters) - British hi-tech plastics firm Victrex (VCTX.L) reported flat half-year profits despite unfavourable exchange rates but said it was confident the business would continue to grow in 2008.

Victrex, which makes polymers used in products from car engines to microchips, also said its chairman, Peter Warry, would step down at the end of September and be succeeded by Anita Frew, the group's senior independent director.

"As the trend grows for lighter plastic material to be preferred over heavier, less weight efficient, metals, indications are that the second half should hold up well," said Martin Evans, an analyst at house broker Cazenove, who upgraded his 2008 pretax forecast on the firm, which has an outperform rating, by 2 percent.

By 0829 GMT shares in Victrex had edged up 0.3 percent to 742-1/2 pence.

The Lancashire-based company reported pretax profit of 27.2 million pounds ($53.2 million) on sales 3 percent higher at 68.5 million for the half-year ending in March, despite taking a 3.9 million hit on adverse exchange rates compared to 0.7 million last year.

Victrex expects the currency situation to turn around in 2009 and said it sees results "positively impacted by the weakening of sterling provided that current market rates are maintained".

The company boosted its interim dividend by 11 percent to 5.2 pence from last year's handout of 4.7 pence.

Victrex said it had record first-half sales volume of 1,294 tonnes, 6 percent ahead of the second half of last year, and in line with market expectations.

Invibo, the company's medical devices business, saw revenues grow 23 percent to 11.7 million on last year's 9.5 million as the group commercialised 428 of its PEEK polymer applications. Invibo "seems to be growing pretty quickly" according to ABN AMRO analyst Conor O'Prey.

Transport sales volumes were up 10 percent on last year due to increased automotive sales in all regions, with industrial up 3 percent on strong growth in oil and gas applications. Aerospace sales were largely flat but electronics was up 4 percent due to increased semiconductor and consumer electronics sales, Vitrex said.

Outgoing Chairman Warry said the second half had started at "levels similar to the first half", adding he was "confident in the underlying growth potential for the business". (Reporting by Rhys Jones; Editing by Louise Ireland)