UPDATE 1-Tanger Q1 FFO up 12.8 pct, maintains forecast

* Reports first-quarter FFO of 66 cents per share

* Maintains 2009 forecast

* Shares up 2.6 percent in after-hours trade

NEW YORK, April 23 (Reuters) - Tanger Factory Outlet Centers Inc (SKT.N) on Thursday said first-quarter funds from operations rose 12.8 percent, but the outlet center owner and developer maintained its forecast for the year as the economy damped sales.

Tanger reported quarterly funds from operations (FFO) of $24.7 million, or 66 cents per share, up from $21.9 million, or 59 cents per share, in the year-earlier quarter.

Analysts on average had forecast 65 cents per share, according to Reuters Estimates.

After the company issued its report, shares of Tanger rose 2.6 percent in after-hours trade to $35 from its close of $34.01 on the New York Stock Exchange.

FFO removes the profit-reducing effect of depreciation, a noncash accounting item. Under Generally Accepted Accounting Principles, its profit was $28.9 million, or 92 cents per share, up from $4.9 million, or 16 cents per share.

Occupancy at its wholly owned malls fell to 93.5 percent from 95.3 percent last year.

Tanger said sales at its wholly owned centers fell 3.2 percent to $338 per square foot, citing the current downturn in the economy.

For centers opened at least a year, net operating income rose 2.4 percent, less than half that of a year ago when the increase was 5.7 percent.

The company kept its prior forecast of 2009 FFO in the range of $2.73 to $2.83 per share, while analyst forecast $2.77. (Reporting by Ilaina Jonas; Editing by Phil Berlowitz)