UPDATE 1-Regal Beloit quarterly profit falls

* Q1 EPS $0.39 vs year-ago $0.95

* Q1 revenue $443.3 mln

* Sees Q2 shr $0.38-$0.46

May 6 (Reuters) - Regal Beloit Corp (RBC.N), which makes industrial motors and power generators, posted a 59 percent drop in first-quarter profit, and said it expects the difficult sales environment to continue into the second quarter.

"We do not believe that the normal seasonal pick up in sales will materialize and we believe that inventory liquidation by our customers will continue well into the second quarter," Chief Executive Henry Knueppel said in a statement.

The company also plans to aggressively reduce inventory levels and expects the move to impact gross margin by about $7.5 million.

For the first quarter, net income was $12.8 million, or 39 cents a share, compared with $31.4 million, or 95 cents a share, a year ago.

Revenue fell 17 percent to $443.3 million.

Analysts were looking for earnings of 39 cents a share, before special items, on revenue of $441.5 million, according to Reuters Estimates.

It expects second-quarter earnings of 38 cents to 46 cents a share. Analysts were looking for 42 cents a share.

Shares of the company closed at $41.29 Wednesday on the New York Stock Exchange. (Reporting by A.Ananthalakshmi in Bangalore; Editing by Jarshad Kakkrakandy)