* Casino sales fall 0.6 percent to 7.2 billion euros
* Says it is accelerating cost cuts, improving product mix
* France organic growth drops 4.4 percent quarter-on-quarter
(updates with cost cutting detail)
PARIS, Oct 14 (Reuters) - French retailer Casino said on Wednesday it is stepping up an action plan to enhance its brand appeal and protect margins, after posting a 0.6 percent year-on-year fall in third-quarter sales.
The retailer reported total revenues of 7.2 billion euros, in line with analyst expectations.
Casino said it is moving "up a gear" in implementing cost cuts and optimising food and non-food product mixes, although it is sticking with an existing cost-cutting target of 300 million euros over two years.
Although the supermarket chain enjoyed strong sales overseas, particularly in Latin America, it reported a 4.4 percent quarter-on-quarter drop in organic growth in its home market of France.
France accounts for nearly two-thirds of Casino's revenues. It has proven a tough market for retailers in an environment of falling food prices and consumer caution over discretionary non-food purchases.
"We have started our cost reduction plans and here again we are on track," said Antoine Giscard-d'Estaing, Casino's chief financial officer, on a conference call with analysts. "We are on target to meet our objectives."
Casino announced earlier this year that it would ramp up cost-cutting, targeting 300 million euros over two years, from just 150 million euros over one year.
The retailer on Wednesday reconfirmed its target to improve the net debt/EBITDA ratio at year-end and to reduce it to less than 2.2 by the end of 2010.
The group has also announced an asset disposal plan worth 1 billion euros. Its 57 percent stake in Dutch retailer Super de Boer is expected to be sold as part of this plan after competing bids from rivals Jumbo and Sperwer.
Casino said that international sales including Super de Boer grew 2.8 percent quarter-on-quarter on an organic basis.
Casino's shares closed up 1.4 percent, at 54.96 euros, before the sales data was published.
Casino operates in 10 countries with a network of over 10,000 stores. Its brands include Geant Casino and Hyper Casino hypermarkets; Franprix and Monoprix supermarkets; Petit Casino convenience stores and Cdiscount Internet shopping.
(Reporting by Lionel Laurent; Editing by David Cowell) (lionel.laurent@thomsonreuters.com; +33 1 49 49 56 85; Reuters Messaging: lionel.laurent.thomsonreuters.com@reuters.net)