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UPDATE 2-Under pressure Nestle boss disappointed by first half growth

* H1 organic sales growth 2.3 pct, same as Q1

* Sees 2017 sales at lower end of target range

* Shares fall 1.1 percent

* No comment on dialogue with Daniel Loeb (recasts, adds CFO, share price, analyst, detail)

ZURICH, July 27 (Reuters) - Nestle trimmed its 2017 sales outlook on Thursday, adding fuel to shareholder demands on its chief executive Mark Schneider to speed up a turnaround of the world's largest food group.

Schneider, who became CEO of the maker of KitKat chocolate bars and Nescafe instant coffee in January, faces calls to improve Nestle's performance after activist investor Daniel Loeb bought a $3.5 billion stake.

Faced with a trend towards healthier eating, makers of packaged foods are seeking to win back consumers' favour by reducing sugar, salt and fat in their products and to reassure worried investors by improving efficiency and cutting costs.

Nestle reflected difficulties in the sector when it said on Thursday it expected 2017 sales growth to be "in the lower half" of its 2 to 4 percent target range.

French rival Danone on Thursday reported a slowdown its second-quarter growth figures.

Nestle said its organic sales, which includes volume and price increases, grew by 2.3 percent in the first half, the same rate as the first quarter, trailing analyst estimates of 2.8 percent and slowing from 3.5 percent a year earlier.

Schneider, who has launched a 20 billion franc share buyback and is expected to unveil more details of his strategy at an investor day in September, said he was disappointed.

"Organic growth in the first half did not fully meet our expectations ... While volume growth remains at the high end of our industry, pricing continues to be soft," he said.

NO MAGIC WAND

Although Nestle's first-half net profit rose 19 percent to 4.9 billion Swiss francs ($5.16 billion), beating a 4.83 billion franc average estimate in a Reuters poll, its shares lost 1.1 percent in early trading as analysts described the results as weak and a trigger for more drastic action.

"It shows you that CEO Mark Schneider has a lot of work to do and there isn't a magic wand in terms of getting the top line going," said Jon Cox from Kepler Cheuvreux.

Chief Financial Officer François-Xavier Roger declined to say whether he expected pricing -- which increased by 0.9 percent in the first half -- to pick up later this year.

"We are cautious. Part of it is linked to commodity prices and because of the high volatility there we need to be cautious," he said.

Nestle had raised prices in Europe for products like coffee, but this had reduced sales volumes, Roger told reporters.

He declined to comment on any dialogue with Loeb's U.S. hedge fund Third Point, which urged management to take steps to improve returns last month after disclosing its stake.

Third Point, which said Nestle should set a margin target of 18 to 20 percent by 2020, buy back shares, sell non-core businesses and exit its holding in French cosmetics giant L'Oreal, was not immediately available for comment.

Although Schneider has made some changes, including putting Nestle's U.S. confectionery business under review, Loeb and others say the company is moving too slowly. (Reporting by John Revill, additional reporting by Silke Koltrowitz and Brenna Hughes Neghaiwi; editing by Michael Shields and Alexander Smith)