By Susan Kelly

CHICAGO (Reuters) - Covidien Ltd (COV.N: Quote, Profile, Research) said on Tuesday second-quarter net earnings fell on restructuring and other charges, but results beat expectations as the weaker dollar gave a boost to sales.

The health care products company also raised its outlook for 2008 sales growth, citing a stronger-than-expected fiscal first half due in part to the dollar's decline, which lifts the value of overseas sales in local currencies.

"Even if you back out the impact of foreign exchange, it was still a very impressive quarter. I'm really impressed with the medical devices business," said Morningstar analyst Alex Morozov.

Covidien, which was spun off from Tyco International (TYC.N: Quote, Profile, Research) in July 2007, said net income in its fiscal second quarter ended March 28 was $263 million, or 52 cents a share, compared with $394 million, or 79 cents a share, a year ago.

Costs for restructuring operations and the settlement of Covidien's part in a shareholder lawsuit involving former parent Tyco International (TYC.N: Quote, Profile, Research) reduced the net results, while operational results benefited from a lower tax rate.

Excluding special items, Covidien earned 66 cents a share from continuing operations in the quarter.

Net sales rose 10 percent to $2.42 billion, fueled by strong growth in the medical devices and imaging solutions divisions.

Analysts on average forecast earnings of 59 cents a share, before items, on revenue of $2.37 billion, according to Reuters Estimates.