UPDATE 2-Edison CEO sees ongoing sluggish demand

* Ongoing sluggish demand to weigh on growth-CEO

* Credit rating safe, supported by disposals-CEO

* Shares underperform sector

(Adds comments from conference call, releads)

By Stephen Jewkes

MILAN, Oct 30 (Reuters) - Edison (EDN.MI) expects sluggish power and gas demand to carry on into 2010 as the economic crisis continues to take its toll, weighing on growth and margins, Chief Executive Umberto Quadrino said on Friday.

Quadrino, who sees debt easing to around 4 billion euros at the year end, said Edison's credit rating is safe and will be bolstered by the sale of a stake in its Abu Qir gas field in Egypt and other possible asset disposals.

Edison is rated BBB+ by Standard & Poor's and BAA2 by Moody's.

"I see 2010 rather flat as far as debt and profitability is concerned compared to this year since demand is not picking up very much," Quadrino said in a conference call with analysts.

Gas margins will be depressed in 2010 while power margins should be in line with those of this year, he said.

On Tuesday Austria's Verbund (VERB.VI) cut its profit expectations for the year and Swedish peer Vattenfall [VATN.UL] cut investments in new power plants as the economic crisis continues to hit demand. [ID:nLR390241]

Edison said its core earnings fell 6.7 percent in the first nine months to 1.128 billion euros. It confirmed its guidance for full-year results to be in line with the previous year on a like-for-like basis.

Debt at the end of September was 4.222 billion euros.

Quadrino told analysts there are five groups interested in buying a stake in Abu Qir, the sale of which should be completed at the beginning of 2010. It is expected to raise around 250 million to 300 million euros, he added.

The two advisers for the operation are Intesa Sanpaolo (ISP.MI) and BNP Paribas (BNPP.PA), he said.

Edison is jointly controlled by French utility EDF (EDF.PA) and Italian municipally-controlled utility A2A (A2.MI)

Edison shares closed down 3.69 percent at 1.045 euros while the DJ Stoxx Utility index .SX6P was 1.85 percent lower. (Editing by Jon Loades-Carter)