UPDATE 3-WestJet earnings slide but worst could be over

* Signs that declines in revenue stabilizing

* CEO says H1N1 flu not hitting bookings

* Working on new code-share pacts

* Earnings down 46 pct

(Recasts with CEO interview, analyst comment)

By Nicole Mordant

VANCOUVER, British Columbia, Nov 4 (Reuters) - WestJet Airlines Ltd (WJA.TO) posted a 46 percent slide in quarterly earnings on Wednesday, but Canada's second-biggest carrier sees signs that a brutal air-travel slowdown is ending.

In the past six to eight weeks, declines in revenue per available seat mile, or RASM, a key industry benchmark, look to have leveled off, the no-frills airline's chief executive said, sending WestJet's share price higher.

"I am cautiously optimistic that (the environment) has improved," said Sean Durfy in an interview. "I think the marketplace is less sensitive to pricing and we are starting to see a pickup."