UPDATE 1-Italy's A2A Q1 net down 2.1 pct

(Adds details, share price)

MILAN, May 14 (Reuters) - Italian regional utility A2A SpA (A2.MI: Quote, Profile, Research) posted a 2.1 percent drop in first-quarter net profit on Wednesday and the newly merged company forecast 2008 results no worse than in 2007.

Net profit at A2A, Italy's second-biggest power generator, slipped to 143 million euros ($221.1 million) from 146 million euros.

Earnings before interest, tax, depreciation and amortisation (EBITDA) were almost flat at 317 million euros, the company said in a statement.

"Overall, consolidated results for 2008 will be positive and, given the evolution currently expected in the competitive and regulatory context, no lower than those of 2007," it said.

Net debt dropped to 3.088 billion euros, down 261 million euros from the end of 2007.

The shares closed up 0.98 percent at 2.368 euros. The DJ Stoxx utilities index was 0.64 percent firmer.

A2A was formed from municipal utility AEM Milano's takeover of smaller peer ASM Brescia last year.

A2A said it had changed its accounting method for joint ventures from the proportional integration method to the equity effective from Jan. 1.

(Reporting by Ian Simpson)