Owens-Illinois warns of weak 3rd qtr on European woes

* Q2 EPS $0.81 vs est $0.76

* Q2 sales fell 10 pct to $1.77 billion

July 25 (Reuters) - Glass-container manufacturer Owens-Illinois Inc reported a better-than-expected quarterly profit, helped in part by cost cutting in its North American operations, but it warned of a lower adjusted profit ahead.

The Perrysburg, Ohio-based company forecast a weak third-quarter on lower European demand and said it was reducing its capital spending for the remainder of the year.

The company now expects at least $250 million of free cash flow in 2012.

For the second-quarter, the company posted net earnings from continuing operations of $134 million, or 81 cents per share, up from $71 million, or 42 cents per share, a year earlier.

Net sales fell 10 percent to $1.77 billion.

Analysts, on average, had expected earnings of 76 cents, on revenue of $1.92 billion, according to Thomson Reuters I/B/E/S.

Shares of the company were trading up 2 percent in after-market trade at $19.00. They had closed at $18.62 on Wednesday on the New York Stock Exchange.