UPDATE 2-Children's Place Q3 profit tops mkt, to name new CEO

* Says to name permanent CEO by year-end

* Q3 EPS from cont ops $1.38 vs est $1.37

* Q3 sales up 3 pct

* Sees '09 oper expenses down by $20 mln vs '08

* Shares fall 5 pct in early trade, recover later

Nov 19 (Reuters) - Children's Place Retail Stores Inc (PLCE.O) posted a quarterly profit that edged past market estimates and said it intends to name a permanent Chief Executive by the end of this year.

Children's Place, which has gone without a permanent CEO since 2007, was involved in a proxy contest with former chairman and Chief Executive Ezrah Dabah, which came to a close in July. [ID:nN29291442]

Dabah, the last permanent CEO, had expressed concerns over the company's management and board, urging it to appoint a permanent replacement to interim Chuck Crovitz.

"While we don't have an announcement to make today, it is the board's intention to name a permanent CEO by year-end," Crovitz said in a post-earnings conference call with analysts.

Promotions and tighter cost controls helped Children's Place Retail Stores Inc (PLCE.O) beat market estimates by a penny for the third quarter even as the company brought in more merchandise to prepare for the holiday selling season.

On the conference call, the company said it now expects operating expenses for 2009 to be at least $20 million lower than in fiscal 2008.

"Based on our expectation that the consumer will remain price sensitive ... we plan to offer compelling promotions ... throughout the holiday season," Crovitz said.

Sales from e-commerce grew 44 percent during the quarter, with the segment now accounting for 7 percent of the total sales compared with 5 percent last year.

During the third quarter, Children's Place -- which rivals Gymboree Corp GYMB.O and Gap Inc's (GPS.N) Baby Gap line among others -- earned $37.8 million, or $1.37 share, compared with $24.1 million, or 81 cents a share, a year ago.

Income from continuing operations was $1.38 per share.

Analysts on average had expected a profit of $1.37 cents a share, according to Thomson Reuters I/B/E/S.

Children's Place shares pared some of their early losses and were down 57 cents at $34.30 in afternoon trade Thursday on Nasdaq. They touched a low of $33.20 in early trade.

The S&P Apparel Retail Sub-Industry Index .15GSPRETA was down 2.3 percent. (Reporting by Nivedita Bhattacharjee and Shobhana Chadha in Bangalore; Editing by Pradeep Kurup and Gopakumar Warrier)