UPDATE 1-International Power upgrades profit forecast

* Sees 2009 EPS in line with 2008, after previous warning

* Says global demand driving growth

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LONDON, Nov 11 (Reuters) - British power generation company International Power (IPR.L) said on Wednesday it now expects 2009 earnings per share to be broadly in line with 2008 and that it sees free cash flow significantly ahead of last year.

"The financial position of the group remains strong," the company said in an interim statement for the period from July 1 to Nov 10.

Although first-half results, reported in August, were boosted by currency effects and a strong performance in Asia and Australia, the company had warned 2009 profits would fall because of difficult markets in the U.K. and U.S. [ID:nLA452303]

The company, which has interests in over 45 power stations, said forward margins in its U.S. and U.K. markets remain challenging, but added that global demand is driving growth, particularly in developing economies.

International Power said its long-term portfolio in the Middle East and Asia continues to operate well.

It also recently moved into the Canadian renewables market with the acquisition of wind farm developer AIM PowerGen from Renewable Energy Generation for 109 million pounds ($182.5 million).