* Q1 EPS 7 cents vs loss of 11 cents a year ago

* Q1 rev up 10.6 pct to $1.903 bln

* Basic video subscribers down by 6,300

* Board to explore spin-off of Madison Square Garden

* Shares up 1 pct in mid-day trading (Repeating to additional subscribers) (Adds investor comment; background)

NEW YORK, May 7 - Cablevision Systems Corp (CVC.N) floated a plan to spin off of its Madison Square Garden business, which includes its New York Knicks basketball team and Radio City Music Hall, and it posted a first-quarter profit.

Shares jumped as much as 18 percent on Thursday on the prospect of an imminent spin-off but fell back after management declined to give any details of its spin-off plans on a conference call with analysts.

The company's management also said they are not currently looking to spin off other assets like its Newsday newspaper slightly dampening speculation that a break-up of the company is in the works.

This is possibly the first step to distilling the company down to its telecommunications assets paving the way for eventual consolidation of those assets, said Chris Marangi, an analyst at Gabelli & Co, a long-time holder of Cablevision shares.

Cablevision, whose cable operations serve more than 3 million customers in the New York area, also owns the AMC, WE and the Sundance Channel cable channels. There has long been expectation that the company will eventually sell its cable operations to a buyer like Time Warner Cable Inc (TWC.N) or Comcast Corp (CMCSA.O).

The Dolan family, who are controlling holders of Cablevision, have been pressed by investors in recent years to consider spinning off some of its media assets, which they felt were being undervalued within Cablevision.

Even taken at face value, a spin off could release huge value, Bernstein Research analyst Craig Moffett said in a note. The MSG treasure trove includes the Knicks and (New York) Rangers (hockey team), cable TV networks, world class real estate and venues, and hidden gems like Radio City Music Hall.

Moffett estimates that MSG's assets are worth nearly $3 billion.

The Dolans have previously tried on at least three occasions to take the company private at prices that investors said were too low. Last August Chief Executive Jim Dolan said that the company would explore strategic options including asset sales.

But in November Dolan said the company was not actively pursuing these options due to adverse credit market conditions.

FROM LOSS TO PROFIT

The New York cable operator posted a net profit of $20.2 million, or 7 cents per share, compared with a year-ago loss of $31.6 million, or 11 cents per share.

Revenue grew 10.6 percent to $1.903 billion, partly boosted by the additions of Newsday newspaper and Sundance cable network, which it bought last year.

Cablevision, which faces fierce competition from Verizon Communication's FiOS TV digital service in its market, lost 6,300 basic video subscribers during the quarter.

Analysts at Bernstein Research had forecast it would lose 8,000 subscribers.

Cablevision added 51,400 digital phone subscribers and 29,800 high-speed Internet subscribers. Bernstein expected Cablevision would add 22,000 phone subscribers and 22,000 Internet subscribers.

Cablevision also added 9,400 digital video subscribers during the quarter, while Bernstein expected it to add 24,000.

Shares were up 7 cents at $18.40 on the New York Stock Exchange. (Reporting by Yinka Adegoke, editing by Maureen Bavdek and Derek Caney)

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