* SolarWorld says pricing pressure could hurt H2 sales
* Phoenix Solar cuts outlook, sees 2011 sales falling
* SolarWorld shares up 4.2 percent on Q2 operating profit
* Phoenix Solar flat amid wider market bounce
(Adds background on global, updates shares)
FRANKFURT, Aug 11 (Reuters) - Major solar power companies warned of an uncertain outlook for the industry, faced with oversupply and falling prices as governments in key markets withdraw incentive schemes and Asian competitors circle.
SolarWorld , Germany's No.2 solar company by sales, echoed recent comments by global peers when it warned on Thursday that its outlook for higher sales in 2011 may be undermined by free-falling prices and overcapacity.
Phoenix Solar cut its outlook to say it expects sales to fall this year instead of remaining flat or rising, blaming intense pricing pressure in the first half of the year. Shares in the company dropped 1.8 percent but then recovered amid a wider market bounce to be flat.
The news chimed with similar statements from First Solar , the world's largest solar company by market value, and German solar cell and panel-maker Q-Cells , which have already reduced their full-year outlooks due to plunging prices.
Solar companies ramped up production last year to meet a surge in demand from Germany and Italy as customers rushed to buy solar before governments started to phase out incentive schemes. SolarWorld makes the panels that convert sunlight to electricity and Phoenix Solar builds and installs solar plants.
Now they have been hit by a toxic mix of high inventories, slower demand and low-cost Asian competitors as a boom that has been expected by some industry analysts following Japan's nuclear disaster fails to materialise.
Germany and Italy are reducing support schemes to make the solar sector more productive, but are not increasing demand in the meantime. After deciding to pull out of nuclear energy, Germany is now looking to coal and gas to fill its needs.
The result: a perfect storm for industry operating margins.
"In general, (it's) very difficult to see the bull case for most German solar companies in my view, and now lending will become more difficult it should be interesting to see how it all play out," said Jon Sigurdsen, fund manager at DnB Nor unit Carlson.
SolarWorld Chief Executive Frank Asbeck said he still expected 2011 sales to beat last year's 1.3 billion euros ($1.84 billion.)
But the company cautioned in a statement: "The political and macroeconomic background conditions may, however, lead to cyclical industrial surplus volumes and corresponding undercut prices in the solar market in the second half."
SolarWorld's shares rose nonetheless, due to its better-than-expected second-quarter operating profit of 40.2 million euros, against the 28.7 million average forecast in a Reuters poll of analysts. ($1 = 0.705 euro) (Editing by Sophie Walker)