UPDATE 1-Acerinox Q1 net beats f'casts, outlook seen bright

(Adds details, outlook, share cancellation, dividend)

MADRID, April 22 (Reuters) - Spanish stainless steel maker Acerinox (ACX.MC) posted better-than-expected first-quarter results on Tuesday, painting a bright outlook for the rest of the year.

"The strength of demand allows us to be optimistic regarding the price outlook for the coming months," the company said in a statement, adding it was also upbeat about full-year profit prospects.

Net profit fell 68.3 percent to 66.7 million euros ($105.7 million), beating expectations.

Acerinox said it would propose cancelling 2 percent of its shares it holds as treasury stock. It also proposed a final dividend of 0.15 euros per share, payable in July.

Profit and revenue in the same period last year had been boosted by booming prices.

Acerinox's profits shot up in the first half of 2007 on higher prices, but business shrank back from the third quarter due to a fall in nickel prices.

Revenue in the first quarter of this year fell 26.9 percent year-on-year to 1.57 billion euros.

Analysts had expected net profit of 55.2 million euros on revenue of 1.58 billion euros.

Earnings before interest and taxes fell 68.6 percent to 107.8 million euros, outpacing expectations for 93.9 million euros. (Reporting by Elisabeth O'Leary; Editing by Jane Barrett and David Holmes)