* Q3 sales 5.48 bln euros
* Q3 like-for-like sales growth 4.1 pct
* N.America hit by retailers cutting inventories-CEO
PARIS, Oct 30 (Reuters) - French cosmetics maker L'Oreal said like-for-like sales growth slowed to 4.1 percent in the third quarter as retailers in North America slashed inventories in response to a market slowdown.
This missed the average analyst estimate for sales growth of 5 percent and compared with 5.2 percent growth in the second quarter and 5.5 percent in the first. L'Oreal had sales of 5.48 billion euros ($7.54 billion) in the three months to Sept. 30.
"We started the year 2013 in the U.S. in the consumer division really full steam, confident that the market would be very strong," Chief Executive Jean-Paul Agon said on a conference call on Wednesday.
"In fact, two things happened: The market slowed brutally at the end of the first quarter due to many different factors. And then the retailers overreacted, as they very often do, brutally this summer by cutting very severely inventories."
Sales growth in North America slowed to 0.6 percent like-for-like in the third quarter from 5.4 percent in the first half of the year, the maker of Garnier shampoo and Maybelline make-up said.
However, L'Oreal is gaining share and outpacing the market in its luxury division in the United States, Agon said. The group's luxury products include Rouge Pur Couture Yves Saint Laurent lipstick and Armani perfumes.
"Overall like-for-like sales growth was well below consensus and was the lowest growth seen for almost three years, since Q4 2010," Bernstein analyst Andrew Wood wrote.
"We expected a slowdown in North America but nothing as bad as what was delivered, which was the lowest growth since the depths of the recession four years ago."
Growth in Latin America also slowed - to 8.5 percent from 13.5 percent in the first six months of 2013 - though L'Oreal said sales trends were positive despite the impact of a slowdown in Mexico, hit by the same issues as the United States.
Western Europe, meanwhile, achieved its best performance since the first quarter of 2010, according to Wood, with 2.6 percent like-for-like sales growth. This was likely driven by the impact of good weather on sun care sales, he said.
Figures were good in northern Europe, while southern Europe is still proving difficult, L'Oreal said.
Agon said the economic environment remained uncertain and also noted the negative impact of exchange rates, but he expected the fourth quarter to be better than the third, describing the situation in the U.S. as a "blip".
On a reported basis, group third quarter sales fell 0.8 percent, with a 6 percent negative impact due to the depreciation of currencies including the U.S. dollar, the Brazilian real, the Japanese yen, the Indian rupee and the Argentinian peso against the euro, L'Oreal said.
Agon confirmed the group's targets for a further year of growth in sales, results and profitability.
Shares in L'Oreal are up about 22 percent this year, outperforming a 13 percent rise in the sector index. With a market value of 77 billion euros, it is France's third-biggest listed company.