UPDATE 2-Brazil's Usiminas posts weak Q3 results but worst may be behind

(Rewrites throughout)

SAO PAULO, Oct 27 (Reuters) - Brazilian steelmaker Usiminas reported weak quarterly results on Friday but said it will soon relight a blast furnace following months of maintenance, lifting its shares as investors believe the worst might now be behind it.

CEO Marcelo Chara said in a call with analysts that the work on Ipatinga's blast furnace #3, which began in April, was completed and production is set to resume in coming days.

The company said the fourth quarter is still poised to be "tough", but within its expectations, while prospects for 2024 are positive.

Shares of Usiminas were up more than 5.5% by midday trading, making it the top gainer on Brazil's benchmark stock index Bovespa, which added 0.2%.

The Ipatinga blast furnace relighting places the company into a better operational environment over the next few quarters as the asset accounts for about 60% of its active crude steel capacity, BTG Pactual analysts led by Leonardo Correa said.

"Momentum could start to build over the coming months as the company comes out stronger from its blast furnace maintenance, and quarterly earnings begin to improve," they noted.

Usiminas' positive tone about the future helped offset weak results for the third quarter, when it posted negative earnings before interest, taxes, depreciation and amortization (EBITDA) for the first time in nearly eight years.

Adjusted EBITDA was negative 20 million reais ($4.04 million), Usiminas said, with a net loss of 166 million reais making the bottom line slip back from the 609 million-real profit seen a year earlier.

Both, however, were better than the negative EBITDA of 63.8 million and the net loss of 180 million reais expected by analysts polled by LSEG.

The company said the figures reflected a smaller operating result, with steel sales slipping 2% to 1.02 million metric tons amid falling prices, and losses from foreign exchange swings.

"It's an ugly picture but the film may be starting to improve," Ativa analyst Ilan Arbetman said. "Despite the still extremely challenging operating performance, we see markets welcoming the results with a feeling that the worst might be behind."

Usiminas said it expects steel sales in the fourth quarter to come in between 900,000 and 1 million tons. ($1 = 4.9499 reais) (Reporting by Alberto Alerigi Jr and Gabriel Araujo; Editing by Steven Grattan and Marguerita Choy)