UPDATE 1-Australia's Futuris warns on profit, shares slide

(Recasts after share reaction, adds details)

SYDNEY, June 25 (Reuters) - Australian rural conglomerate Futuris Corp Ltd FCL.AX downgraded its profit outlook by as much as 20 percent on Wednesday, dragging its share price down 19 percent to its lowest in five-and-a-half years.

The company cut its forecast underlying net profit to A$80-85 million ($76-81 million) for the year to June 30, down from the A$100 million it forecast only seven weeks ago.

It blamed weaker sales of its plantation investment funds, a likely loss from its 43 percent interest in AACo (AAC.AX), the world's biggest cattle firm, as well as higher interest expenses.

"Demand for MIS (managed investment schemes) products in the year to date has proven to be significantly weaker than in the previous year," Futuris said.

"The company's equity-accounted share of earnings from AAco are now also expected to be negative," it added.

Futuris shares were down 19.1 percent at A$1.08 each at 0114 GMT. The company has lost almost half its value this year.

Industry analysts had been expecting Futuris to make a net profit of A$96 million in 2007/08, down from A$101.7 million the year before, and to report earnings before interest and tax (EBIT) in a range of A$155-183 million for 2007/08.

Futuris said on Wednesday it now expected EBIT of between A$166 million and A$182 million for 2007/08. Last month, it had forecast EBIT at the top end of a range of A$154-183 million.

AACo shares were down 3.3 percent at A$2.67.

AACo owns 1.2 percent of the entire land area of Australia, with landholdings larger than Ireland and 12 percent the size of Texas, and is worth about A$800 million. ($1=A$1.05) (Reporting by Mark Bendeich; Editing by James Thornhill)