UPDATE 2-Implats FY profit falls, seeks to expand ops

* Implats says FY headline EPS 786 cents vs yr-ago 1,001c

* Final cash dividend of 390 cents per share

* Gross refined platinum output down 8 pct

* Shares up 4.2 pct, outperform main JSE index.

(Recasts, adds details and comment)

By Shapi Shacinda

JOHANNESBURG, Aug 26 (Reuters) - Impala Platinum (IMPJ.J) reported a 22 percent fall in full-year profit on Thursday, hit by slack demand following the global economic crisis, but said it would ramp up operations in anticipation of recovery.

Implats, the world's second-largest platinum producer, said in a statement that the year to end-June was one of the most difficult in the company's history.

Platinum producers were hit hard by lower global prices in 2009, but a growing recovery in demand for the metal, which is used in catalytic converters that cut pollutants from car exhausts, is now prompting miners to increase production.

Firm prices for platinum group metals are likely to support the company, said Mark Madeyski, an analyst at Afrifocus Securities.

"The good thing about platinum producers is that they have other (metals) they produce, like palladium. So they don't only rely on the platinum price," he said.

But miners in South Africa, which accounts for four fifths of the world's supply of platinum, face other uncertainties besides price.

The government's handling of two disputed awards of mining rights has damaged the resource-rich country's reputation and raised investor concerns over transparency and governance. [ID:nLDE67F17V]

Unions have been asking for wage increases above inflation, raising fears that company costs could further balloon. Late last year Impala was hit by a two-week strike that caused a loss of at least 80,000 ounces in production.

Nonetheless, CEO David Brown said the company would lift output to 2.1 million platinum ounces by 2014, a 21 percent increase from the year to end-June. It also plans to spend nearly $1 billion in 2011 on mining expansion and upgrades.

SHARES HIGHER

Implats shares were up 4.2 percent at 177.60 rand at 1439 GMT, compared with a 1.85 percent rise on the JSE's Top-40 index .JTOPI.

Impala said headline earnings per share for the year to end-June totalled 786 cents compared with 1,001 cents in the previous year, while revenue fell 3 percent to 25.4 billion rand ($3.5 billion).

Output fell 8 percent to 871,000 ounces.

In addition to the strike, production was hurt after mine accidents late last year caused the company to halt operations. [ID:nL8226878]

Implats said the average platinum price achieved was $1,433 per ounce, up 18 percent on the previous year, while unit cost per ounce was 5 percent higher at 9,592 rand.

It was also hit by higher wages and costs related to a share compensation programme for employees. Like other South African companies, Impala Platinum must meet targets on black ownership and uses its employee share scheme to help meet those targets.

Implats declared a final dividend of 390 cents. (Reporting by Shapi Shacinda; editing by David Dolan and Will Waterman) ($1=7.336 Rand)