UPDATE 2-UK's Sports Direct sees earnings in line with hopes

* Trading conditions hardest it has faced

* Year to date trading in line with expectations

* Shares down 1 pct at 0714 GMT

(Adds details, analyst comment, shares)

LONDON, Oct 23 (Reuters) - Britain's biggest sporting goods retailer Sports Direct International Plc (SPD.L) forecast full-year earnings in line with expectations as it said it was battling the toughest trading conditions it has ever faced.

The company, 71 percent owned by Newcastle United soccer club owner Mike Ashley, said on Thursday it expected year to end-April 2009 underlying earnings before interest, tax, depreciation and amortisation (EBITDA) to meet current market hopes of 135 million pounds ($221.4 million).

This outcome would represent a 10 percent fall on the previous year's 150 million pounds.

Sports Direct, which runs Sports World and Lillywhites stores as well as brands such as Slazenger, Lonsdale and Dunlop, said trading conditions were the hardest the group has had to deal with in its history.

"In spite of these tough market conditions, trading in the year to date is in line with the group's expectations," it said.

Sports Direct has had a torrid time since floating at 300 pence in Feb. 2007.

The retailer has issued three profit warnings, its share price has lost 88 percent of its value, and it is still without a permanent chairman a year and a half after David Richardson quit, having decided he could not work with Ashley, who made 929 million pounds from the float.

Last week Sports Direct purchased a 5 percent stake in struggling rival JJB Sports (JJB.L) and disclosed a further 16 percent interest in the group held through contracts for difference (CFDs).

Ashley bought Newcastle United for 134 million pounds in May last year but put it up for sale in September after the resignation of local hero Kevin Keegan as manager sparked a supporters campaign against him.

At 0714 GMT shares in Sports Direct were down 0.25 pence at 37.25 pence, valuing the business at 213 million pounds.

The stock has underperformed the FTSE UK all-share general retailers index .FTASX5370 by 37 percent over the last year.

Freddie George, analyst at Seymour Pierce, said in a research note his 'hold' recommendation was under review in view of the decline in the share price.

"We do, however, remain cautious on the level of net debt, forecast at approximately 500 million pounds," he said.

(Reporting by James Davey; Editing by David Holmes)