UPDATE 2-Sanoma's Q3 helped by cost cuts, shares jump

* Q3 underlying EBIT 84.5 mln euros vs 77 mln avg in poll

* Sales down 10 pct y/y, miss all forecasts in poll

* Says 2009 outlook unchanged

* Shares rise 9.5 pct

(Releads; adds share reaction, analyst quotes)

By Eva Lamppu

HELSINKI, Nov 6 (Reuters) - Nordic media group Sanoma (SAA1V.HE) said cost cuts help it to post a smaller-than-expected drop in underlying earnings for the third quarter and said more savings were to come, sendings its shares sharply up.

Sanoma shares were up 9.5 percent at 14.54 euros at 1213 GMT, making it the top gainer on a firmer DJ Stoxx Media Index .SXMP.

"Underlying earnings were around 10 percent better versus consensus ... but cost savings were the main reason for why the results surprised positively," said Handelsbanken analyst Maria Wikstrom. "And looking at staff reductions, a big part of the effects from those are still to be seen next year," she added. Sanoma's July-September underlying earnings fell 16 percent year-on-year to 84.5 million euros ($125.5 million), compared with analysts' mean estimate of 77 million in a Reuters poll.

Still, sales dropped 10 percent to 701 million euros, missing all estimates in the poll.

Like other media groups, Sanoma -- based in Finland but with operations across the Nordic region and the rest of Europe -- has been hit hard as advertising plunges. It has launched several cost savings programmes, and cut 9 percent of its staff since last year.

The group stuck to its full-year outlook, saying underlying earnings would clearly fall from a year ago, and added it would continue to reshape its business in the fourth quarter and 2010, closing down unprofitable operations.

"These actions, together with other restructuring expenses, are having a visible impact on our result for the second half of 2009," Chief Executive Hannu Syrjanen said in a statement.

He said that Sanoma would increasingly focus on online operations, with an "up-scaled merger and acquisition ambition." ($1=.6734 Euro) (Reporting by Helsinki Newsroom; editing by David Holmes and Karen Foster)