UPDATE 2-PerkinElmer profit falls but beats Street view

* Q3 EPS $0.30 excluding items vs Street $0.26

* Revenue down 8.7 pct to $437.1

* Sees 2009 adjusted EPS $1.23 to $1.26

* Shares flat (Adds outlook, CEO interview, sales details, byline)

By Bill Berkrot

NEW YORK, Oct 29 (Reuters) - PerkinElmer Inc (PKI.N) reported sharply lower, but better-than-expected, third-quarter profit on Thursday as sales fell almost 9 percent and the scientific instruments maker took a restructuring charge.

While the company said it sees encouraging signs of improvement in its end markets, the results marked the third successive quarter of lower profit as capital spending by its customers remains tight.

"We're feeling a little better about the latter part of the year now," Chief Executive Robert Friel said in an interview.

"I suspect we'll still be down for Q4, but hopefully as we get into 2010, we'll start to see some positive growth," Friel said, adding, "We're feeling cautiously optimistic about the future."

PerkinElmer posted a net profit from continuing operations of $16 million, or 14 cents per share, compared with a profit of $41.7 million, or 35 cents a share, a year ago.

Excluding certain items, the Waltham, Massachusetts-based company had adjusted earnings 30 cents a share, topping analysts' average expectations by 4 cents, according to Thomson Reuters I/B/E/S.

PerkinElmer, whose shares took a hit in July when it shaved 8 cents off the top of its full-year earnings forecast, raised it on Thursday, essentially taking the midpoint of the range up by 4 cents.

The company now expects adjusted 2009 earnings of $1.23 to $1.26 per share, up from its previous forecast of $1.18 to $1.24 per share, excluding items.

Analysts are looking for $1.21 per share, according to Thomson Reuters I/B/E/S.

Revenue for the quarter fell to $437.1 million from $478.8 million a year ago, but that beat Wall Street estimates of $429.7 million.

Sales in the Human Health division fell 8 percent in the quarter to $180.2 million, while Environmental Health sales were off 9 percent at $256.9 million.

"The hospital budgets are still somewhat constrained, so our medical imaging business still seems to be a little slow. But we do think that it's stabilized. It's not getting any worse," Friel said.

He said smaller ticket items, such as reagents and services, were doing better than products that require significant capital spending.

The acquisitive company remains in the market for small deals in the $50 million to $100 million range with a couple in the works, Friel said.

"It's all around continuing to expand our capabilities, whether it's in diagnostics or the reagents area or from a geographic perspective in the emerging territories."

PerkinElmer shares, which closed up 2.8 percent on the New York Stock Exchange on Thursday, were flat at $18.97 in extended trading. (Reporting by Bill Berkrot; Editing by Tim Dobbyn, Leslie Gevirtz)