UPDATE 2-Conseco posts Q1 profit, shares soar

* Q1 EPS $0.13 vs yr-ago loss $0.04/shr

* Oper profit $0.17/shr

* Shares up as much as 45 pct (Adds conference call details, background, updates share movement)

May 11 (Reuters) - Conseco Inc (CNO.N), a Midwestern U.S. life and accident insurer, swung to a profit in the first quarter after posting seven consecutive quarterly losses, helped by profitability at all three of its insurance businesses.

Conseco, whose shares soared as much as 45 percent on the news, said first quarter was seasonally low for its earnings.

"Overall you should expect that less than 20 percent of annual operating earnings will occur in the first quarter," Chief Executive Jim Prieur said on a conference call.

The company said its overall liquidity improved during the first quarter with about $104 million at the holding company as of March 31.

"Our bank covenant debt to total capital ratio calculated excluding accumulated other comprehensive loss reduced slightly to 27.9 percent in March 31, compared to 28.3 percent at year end 2008," the company said on the call.

In March, the company had warned of a possible default under its credit facility if auditors raised doubts over its ability to continue as a going concern.

Later, it completed the amendment of an existing senior secured credit facility, easing out liquidity concerns. [ID:nBNG470134]

The company said it will continue to evaluate and pursue strategic moves to bolster its capital position going forward.

For the first quarter, the company reported a net income of $24.5 million, or 13 cents a share, compared with a loss of 7.2 million, or 4 cents a share, a year ago.

Net operating income, which excludes net realized investment losses, was $31.4 million, or 17 cents a share.

Analysts on average expected earnings of 20 cents a share, excluding items, according to Reuters Estimates.

Pre-tax operating earnings from its Bankers Life unit rose 54 percent to $44.7 million.

Shares of the company were up 66 cents at $3.35 in afternoon trade, making them the third highest percentage gainer on the New York Stock Exchange. The shares touched a high of $3.90 earlier in the session. (Reporting by Supantha Mukherjee in Bangalore; Editing by Himani Sarkar)