UPDATE 3-McGraw-Hill net down 22 pct, FY revenue view cut

* EPS 20 cents vs 25 cents; revenue down 6 percent

* Grade school textbook sales decline

* Shares down 3.3 percent in afternoon trading (Adds analyst comment, updated share fall, adds byline)

By Jonathan Stempel

NEW YORK, April 28 (Reuters) - McGraw-Hill Cos Inc (MHP.N) said quarterly profit fell 22 percent amid lower demand for elementary and high-school textbooks and for credit ratings on mortgages and other complex debt.

The New York-based company also cut its full-year revenue forecast on Tuesday, but left its earnings forecast unchanged as it keeps a lid on costs.

First-quarter net income attributable to shareholders fell to $63 million, or 20 cents per share, from $81.1 million, or 25 cents, a year earlier.

Analysts on average expected 18 cents per share, according to Reuters Estimates. Revenue fell 6 percent to $1.15 billion, roughly matching estimates. Expenses were down 4 percent.

"The challenging economy, a seasonally slow start in the elementary-high school business and continued weakness in advertising and the structured finance market were important factors in our first-quarter decline," Chief Executive Harold "Terry" McGraw said in a statement. "Cost containment will be a priority for us all year."

McGraw-Hill still expects a full-year profit of $2.20 to $2.30 per share, but said it expects revenue to fall 4 percent to 5 percent from 2008's 36 billion. In February it forecast a 1 percent to 2 percent drop in revenue.

Craig Huber, an analyst at Barclays Capital, maintained an "overweight" rating on McGraw-Hill but wrote in a note to clients: "Given (the) environment, we remain skeptical" the company will hit its full-year profit forecast.

In afternoon trading, McGraw-Hill shares were down 96 cents, or 3.3 percent, at $28.07 on the New York Stock Exchange. They began the year at $23.19.

Financial services revenue fell 5 percent in the first quarter to $610.2 million, reflecting U.S. issuance declines of 48 percent in mortgage-backed, 61 percent in collateralized and 84 percent in asset-backed debt. An increase in investment-grade corporate bond issuance tempered the overall decline.

S&P and its rivals, Moody's Corp's (MCO.N) Moody's Investors Service and Fimalac SA's (LBCP.PA) Fitch Ratings, are trying to restore confidence in their ratings.

Investors, regulators and politicians have accused the agencies of fueling the global credit crisis by assigning high ratings to risky debt for years, only to rapidly downgrade the debt later.

McGraw-Hill said revenue from its education unit fell 5 percent in the quarter to $312.6 million.

Revenue in the information and media unit, which includes BusinessWeek magazine, the J.D. Power survey firm and Platts commodities publications, was off 7 percent to $225.4 million.

Analysts expect Moody's to report lower quarterly earnings on Wednesday. (Reporting by Jonathan Stempel; editing by John Wallace)