UPDATE 1-NZ's Sky TV H1 profit up 40 percent

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WELLINGTON, Feb 22 (Reuters) - New Zealand pay-TV operator Sky Television Ltd. (SKT.NZ) reported a 40 percent rise in first-half profit on Friday on strong revenue growth and subdued costs.

Sky, 44 percent-owned by Rupert Murdoch's News Corp. NWS.N, said subscriber numbers and advertising revenue both recorded good gains in the period.

Net profit was NZ$51.2 million ($41 million) in the six months to Dec. 31, up from NZ$36.5 million a year ago.

Shares in Sky TV closed on Thursday at NZ$4.94, having fallen 12.4 percent since July 1, compared with a 15 percent fall in the benchmark NZX-50 index .NZ50.

The company declared an interim dividend of 7 cents a share, compared to 5 cents a share last year.

Total revenue rose 8 percent on the previous year to NZ$328.7 million, while average subscriber revenue rose 2.8 percent.

Operating costs increased 2.5 percent to NZ$229.4 million.

The company has benefitted from a strong New Zealand dollar NZD=, which reduces its hardware and programming costs, but it has also moved to reduce its exposure to swings in the volatile currency.

The company said its subscriber base grew 5.5 percent over the year.

Sky TV offers more than 70 TV and radio channels from the Cartoon Network to the Playboy Channel, including free-to-air Prime. It competes against state-owned Television New Zealand's (TVNZ) two channels and TV3 and C4 networks. ($1=NZ$1.25) (Reporting by Adrian Bathgate; Editing by James Thornhill)