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UPDATE 1-Suez H1 earnings decline as low inflation impacts Europe water tariffs

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* Suez maintains full year financial outlook

* Water tariffs impacted by low inflation in Europe (Adds detail on restructuring costs, savings and redundancies)

PARIS, July 27 (Reuters) - French waste and water group Suez said first-half 2017 earnings before interest and taxation fell 0.6 percent to 594 million euros ($697.1 million) as low inflation in Europe prevented increases in water tariffs.

Suez, the world's second-biggest environmental services group after Veolia, said first-half revenue edged up one percent to 7.53 billion euros although core earnings before interest, tax, depreciation and amortisation (EBITDA) dipped 0.2 percent to 1.27 billion euros. In the first quarter, EBITDA increased 7.1 percent and EBIT by 10.8 percent.

On an organic basis, excluding earnings contributions from new acquisitions, revenue was up 0.9 percent and EBIT was up 1.4 percent.

Suez confirmed its outlook for slight organic growth in revenue and EBIT this year, and for free cash flow of around 1 billion euros. That outlook does not include the impact of the takeover of industrial water specialist GE Water, which is expected to close by the end of the third-quarter of 2017.

Chief Executive Jean-Louis Chaussade said on an earnings call that Suez will present its strategy for the new unit in the fourth quarter.

Suez - which has a market capitalisation of 9.75 billion euros - booked 86 million euros in restructuring costs related to the transformation plan of its French business.

This, along with higher taxes, pushed net profit down 74 percent to 45 million euros, while Chaussade added that the 500 to 600 voluntary redundancies in French support functions announced last year will happen over the next 12 months.

He also said Suez is still planning 150 million euros in cost cuts in 2017.

Suez shares have risen 14 percent in the year to date, underperforming Veolia shares, which are up 18 percent.

Market value of Suez and its main competitor Veolia: http://tmsnrt.rs/2h4w0Vu

($1 = 0.8521 euros) (Reporting by Geert De Clercq; Chart by Leigh Thomas; Editing by Andrew Callus and Sudip Kar-Gupta)