UPDATE 2-Seat Pagine Gialle Q1 net loss narrows

(Adds CEO comments)

MILAN, May 12 (Reuters) - Italian yellow pages publisher Seat Pagine Gialle (PGIT.MI: Quote, Profile, Research) narrowed its first-quarter net loss 15 percent, helped by a reduction in debt and higher tax credits, it said in a statement on Monday.

The company, based in Turin, said it was expecting a net profit for the full year. Seat shares rose more than 3 percent on the news and closed up 2.6 percent at 0.1287 euros.

The company's stock has fallen by about 53 percent this year, giving Seat a market worth of 1 billion euros ($1.55 billion), less than a third of its 3.2 billion euros of debt.

Seat's performance is in line with that of British peer Yell (YELL.L: Quote, Profile, Research), down 51 percent this year, but worse than Sweden's Eniro (ENRO.ST: Quote, Profile, Research), down 38 percent, and France's Pages Jaunes (PAJ.PA: Quote, Profile, Research), down 11 percent.

"The slowing down economy is making it difficult for us to increase our revenues," Chief Executive Luca Majocchi told analysts during a conference call.

As the economy slows, businesses reduce their advertising on Seat's print and Internet directories.

The International Monetary Fund forecast the Italian economy to grow 0.3 percent this year and the next.

After worsening in the second quarter, Seat's print business will improve in the second half of the year, compared with 2007, Majocchi said.