UPDATE 3-Promotions weigh on Flowers Foods results, cuts FY view

* Q3 EPS $0.34 in line with est

* Q3 sales up 4.6 pct at $602.6 mln, miss est

* Trims 2009 outlook

* Shares down as much as 8 pct (Adds analyst comments, updates share movement)

By Mihir Dalal

BANGALORE, Nov 11 (Reuters) - Flowers Foods Inc (FLO.N) posted quarterly sales below market estimates and cut its full-year outlook, as the baker's product prices came under pressure from intense promotional activity by competitors, sending its shares down 8 percent.

Flowers Foods, which competes with Sara Lee (SLE.N), George Weston (WN.TO) and Interstate Bakeries, introduced promotional pricing earlier this year to protect its market share.

"The promotional pressure is pretty broad-based... it is especially severe in Florida, Southern California, Arizona and Texas," BB&T Capital Markets analyst Heather Jones said.

However, Jones doubts if Flowers Foods' competitors can keep up the promotional spending.

"Sara Lee's and Interstate Bakeries' margins are very weak. So, I don't think they can."

Flowers Foods said third-quarter sales volumes fell 1 percent, hurt mainly by lower demand in its non-retail channel.

Foodservice, vending and institutional categories at the company, which produces, markets, and distributes breads, buns, rolls, and baked goods to retail and foodservice customers, have been hit by the gloomy economic environment as consumers eat out less.

Also, heavy promotional activity in the retail channel hurt the company's branded white bread volumes, it said in a statement.

Flowers Foods now expects fiscal 2009 sales of $2.60 billion to $2.61 billion, down from its prior estimate of $2.65 billion to $2.68 billion.

The company also reduced the upper end of its full-year profit view by 8 cents a share. It now sees earnings of $1.37 to $1.40 a share, excluding items.

It expects fiscal 2010 earnings to rise 10 percent to 15 percent on sales growth of 2.5 percent to 4.5 percent, excluding future acquisitions.

For the third quarter, the Thomasville, Georgia-based company posted a higher profit of 34 cents a share, in line with market expectations.

Sales rose 4.6 percent to $602.6 million. Analysts on average were looking for $616.5 million, according to Thomson Reuters I/B/E/S.

Shares of the company were down $1.31 at $22.01 in afternoon trade Wednesday on the New York Stock Exchange. They hit a low of $21.90 earlier in the session. (Reporting by Mihir Dalal in Bangalore; Editing by Pradeep Kurup)