UPDATE 1-Spain's Prisa sees significant ad growth 2008

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By Elisabeth O'Leary

MADRID, April 21 (Reuters) - Spanish media group Prisa (PRS.MC: Quote, Profile, Research) said on Monday that the advertising market, its key source of revenue, would be tough this year during an economic slowdown but it was neverthless expecting significant growth in ad revenues for 2008.

Chief Executive Juan Luis Cebrian told a conference call he was expecting double digit advertising revenue growth for the group in April, compensating for the negative impact of Easter and a general election in March.

"The advertising market is difficult but we are still growing ... and the circumstances in press are a little tougher but we are still expecting significant growth for this year," Cebrian said.

Prisa's flagship publication is El Pais, whose first quarter results showed signs of clear weakness in profitability margins, with its EBIT margin falling to 19.3 percent from 30.4 percent in the same period a year ago.

Cebrian said El Pais' EBIT margin by year-end should be 150 basis points less than at year-end in 2007.

He said it was quite likely that a sale of group property flagged last quarter would be finalised in coming weeks.

In Brazil, where the sale of text books by unit Santillana increased 31 percent in the first quarter, Cebrian said the growth rates could continue.