UPDATE 1-Unemployed body builders boost Glanbia earnings

* H1 EPS up 60 pct, adjusted EPS up 51 pct

* Upgrades FY adjusted EPS growth view to 20 pct

* Irish unit sale project "dormant"

* Shares up 2 pct in thin trade

(Adds managing director comments)

By Andras Gergely

DUBLIN, Aug 25 (Reuters) - Irish food group Glanbia (GL9.I) upgraded its earnings growth outlook, confident a stubbornly high number of U.S. unemployed will spend time in gyms consuming products from its body building supplements unit.

Glanbia is Europe's biggest supplier of mozzarella cheese for pizzas and also makes cheese in the United States for Burger King BKC.N and McDonald's (MCD.N), while turning by-products into protein powders used to build muscles.

"Even if people are unemployed they seem to be maintaining (working out) as an underpinner of self-esteem and people are looking after themselves despite the economic difficulties," Group Managing Director John Moloney told Reuters.

"That's what we see coming through in the volumes we are achieving," Moloney said in a phone interview.

Glanbia on Wednesday posted a 51-percent rise in adjusted first-half earnings per share to 18.62 euro cents and revised its forecast for full-year adjusted EPS growth to about 20 percent from a "mid-teens" percentage rise previously.

Its shares rose 2.1 percent in thin trade to 3.45 euros by 0741 GMT, outperforming a 0.7 percent higher Irish market .ISEQ.

Glanbia said its results were buoyed by a recovery in global dairy markets and a better performance by fast food restaurants -- a sector that traditionally does well in economic downturns -- in the United States in the second quarter.

In May, members of an Irish farmer cooperative which is Glanbia's majority shareholder did not back a proposal to buy Glanbia's domestic dairy and agri-business, dealing a blow to company plans to cut debt and focus even more on its more promising cheese and nutritional supplements business. [ID:nLDE64920X]

With farmers kept busy with summer work, Moloney said there was no imminent change expected in their stance.

"At this stage it might be best described as dormant," Moloney said of the proposed deal. (Editing by Mark Potter)