Ravichandra K. Saligram
President and Chief Executive Officer at Newell Brands
Thank you, Sofya. Good morning, everybody, and welcome to our call. I'm pleased to announce another outstanding quarter for Newell as we further built on the strong momentum from the past three quarters. We delivered 25% core sales growth, 59% normalized operating income growth and 87% normalized EPS growth in the quarter versus prior year. We have now given four consecutive quarters of core sales growth and experienced five consecutive quarters of domestic consumption growth. Based on first half 2021 sales momentum, we are raising our top line outlook for the year. During the second quarter, core sales growth exceeded 25% as we lapped significant disruption from the pandemic. Importantly, even on a two year stack basis, core sales grew low double digits both in the second quarter and during the first half, showing the underlying momentum in the business. I'm especially pleased that once again we saw broad-based top line strength across each of our eight business units and across major channels, with every region growing at a double-digit rate.
While performance in North America was excellent as core sales grew almost 22%, international markets once again shone, registering nearly 35% core growth in the second quarter and almost 31% in the first half, with particular strength in Latin America. seven of our top 10 beloved brands, including Coleman, Graco, Oster, Sharpie, Yankee Candle, Paper Mate and First Alert grew at a strong double-digit pace. Yankee Candle stood out as its sales nearly doubled versus last year. We delivered strong top line results even in businesses such as Food and Home Appliances that faced tough comparisons versus prior year as a result of demand spikes. At the same time. It was extremely encouraging to see the continued rebound in Writing as it has come roaring back, folks, roaring back. From a channel perspective, e-commerce sales growth moderated to a mid-single-digit trend, accounting for about 20% of Newell's global net sales versus peak penetration of around 24% a year ago. During the quarter, we saw a resurgence in consumption in brick-and-mortar as recent progress on vaccine rollout and increased mobility brought people back to the stores.
In fact, growth in brick-and-mortar outpaced digital as the retail industry lapped significant pandemic-related store closures and lockdowns from the second quarter 2020. Given our ongoing investment in omni capabilities, we are well positioned to capitalize on consumer demand regardless of which channels consumers choose to shop. We do, however, believe that over time, digital penetration will continue to move up despite the potential for quarterly fluctuations as channel dynamics settle. The U.S. economy is continuing to regain its footing. We generally saw healthy consumption during the second quarter. There has been some normalization in trend across businesses in the U.S. that experienced significant spikes in demand a year ago, such as Home Appliances and Food. At the same time, consumption accelerated in Writing, which was the victim of the pandemic last year. Recent consumer behavior reinforces our belief that home as the hub theme will persist well after the pandemic.
The home has become central to people's lives and has truly become a sanctuary, a part-time office, a part learning center, a kid's activity zone; and the kitchen, a family hub. Newell is well positioned to capitalize on the home-as-hub phenomenon, not only due to the composition of our business portfolio, but also because of all the work we've done to reinvigorate our iconic brands and innovation funnels that enhance life at home and outside. seven out of our eight business units grew core sales at a double-digit rate, and we made notable progress on market share across a number of categories. Let's start with Home Fragrance, whose sells in the second quarter nearly doubled versus last year, as the business lapped retail store closures and significant disruption in our manufacturing operations due to the pandemic. Net sales increased at a strong double-digit pace relative to 2019 as well, overcoming the unfavorable impact from Yankee Candle store closures and exit from our fundraising business.
Home Fragrance was once again the star of the show, delivering the highest level of top line and consumption growth within our portfolio as we continue to gain market share, particularly in scented candles, and expanded our distribution both in the U.S. and EMEA. Although we expect the scented candle category to continue to moderate, results from a recent survey among scented candle users showed that used frequency remains high, with almost 33% of those surveyed aiming to use the product more often in the next six months. I'm very excited about the long-term prospects of Home Fragrance, which is our most omni-channel business. It has strong gross margins and strong growth potential. The Food business remained on a solid footing across all regions as core sales increased low double digits against a very difficult base period comparison.
As anticipated, POS decelerated in the quarter as the category softened but remained significantly ahead of the 2019 level, as our strong brands continue to take significant share in food storage, fresh preserving and kitchen organization categories. I'm delighted to share some of the recognitions our brands have received this year as Consumer Reports named FoodSaver as the best vacuum sealer for 2021. And Good Housekeeping chose Rubbermaid Brilliance as best food storage for 2021 and [Calphalon] as #1 editor's choice for best nonstick in 2021. It is so exciting to see those accolades, especially at a time when the kitchen is so important to our consumers and our innovation machine has been in full gear. This is another terrific quarter for Home Appliances business. Core sales growth exceeded 15% even as it lapped a high single-digit growth comparison. Once again, Latin America stole the show as we continue to leverage our e-commerce presence to reach consumers, with particularly strong results in Chile, Peru and Argentina. As expected, consumption in the U.S. is moderating against elevated levels from a year ago but remained significantly ahead of 2019. Our needle-mover launch of Mr. Coffee Iced from fall 2020 continues to generate demand, supported by the social media campaign, Switch Up Your #Brewtine. We further broadened distribution during the second quarter with new on-trend colors. Mr. Coffee also introduced the steam espresso maker to capture consumers' heightened interest in specialty and espresso beverages. Mr. Coffee's consistent share gains on the back of innovations and great price value is impressive.
Top line momentum in our Writing business accelerated nicely on a sequential basis. Core sales growth for this business exceeded the company's total result, with every region delivering terrific growth against a suppressed base in the year ago period. The rebound across most Writing categories as more schools return to in-person learning to finish out the school year in combination with share gains in key categories, such as pens, presentation markers, permanent markers and highlighters, translated into terrific consumption in the U.S. for us.
Consumption was up in other parts of the world as well. Newell's share of the gel pen segment increased over 700 basis points to 26% as our consumption nearly doubled behind our needle-mover innovation, Sharpie S-Gel, boy, do I love that pen, which continues to delight consumers and bring incremental dollars to the category. We also have POS growth in other markets, such as Australia, New Zealand and in the U.K. In the second quarter, the office channel also grew versus last year. But as expected, it has not fully come back to pre-pandemic levels due to the prevalence of flexible work arrangements. We are encouraged by the second consecutive quarter of strong POS growth in Writing and remain optimistic about the back-to-school season with robust merchandising plans in place.
Based on the latest available information, in-person instruction, which is the gold standard, is expected to make a comeback this year. According to school opening tracker by a leading industry source, for the upcoming school year, 96% of K-12 student body in the U.S. is in school districts that have already announced they will offer in-person education. Of course, uncertainty remains to some degree given the recent spread of the Delta variant. While we are closely monitoring the situation, we remain bullish on this back-to-school season and believe we are well positioned to win as we continue to grow sales and overall share. During the second quarter, strong double-digit core sales growth for our Baby business was nearly identical to that of Writing, fueled by broad-based momentum across all the regions.
A double-digit increase in consumption, which reflected share gains by Graco in a rapidly growing category, a benefit from stimulus funding as well as an easy comparison, all contributed to such a strong result in the U.S. We think that improving mobility and higher appetite by U.S. consumers to go on overnight trips by car this summer bode well for demand in car seats, the biggest subsegment of the baby gear category in our Baby business. We continue to innovate in this category. Earlier this year, Graco introduced a SnugRide SnugFit, a new line of infant car seats with integrated anti-rebound bar that provides an extra layer of safety for families.
We're also excited by a new report from the Institute of Family Studies that just came in that suggests that the U.S. may be witnessing a surprising rise in births, potentially a result of government stimulus checks and flexible work arrangements. Is there a baby boom going on folks? Our Commercial business unit delivered its sixth consecutive quarter of core sales growth, just shy of double digits, with strong top line momentum across all regions. Higher domestic consumption of material handling, refuse, cleaning, outdoor organization and hand protection and scouring products helped to mitigate declines in washroom solutions, which started to cycle against a significant surge in demand late in the second quarter 2020.
We're seeing signs of reopening-related demand in verticals such as foodservice, hospitality as well as travel and entertainment. And also the builder channel is really beginning to surge, but somewhat offset by softness in washroom solutions and use of sanitizers. Core sales for the Connected Home & Security business also accelerated to a strong double-digit growth rate, lapping significant disruption in the year ago period. The team is navigating through some supply constraints as it relates to chip shortages. Just like other businesses that were negatively impacted by the pandemic last year, we saw significant acceleration in Outdoor & Recreation as core sales increased 25%, with growth in every region and every major category. Coleman, the largest brand in this business unit, delivered terrific results as one of the largest contributors to the company's top line growth this quarter.
While the Call of the Outdoors campaign has already bolstered the outdoor equipment category, this quarter, we also saw a resurgence in sales growth for our on-the-go beverage and technical apparels businesses driven by robust demand. In beverage, Contigo's newly launched product lines are off to a strong start and are driving share gains in the hydration category. The power of our strategic vision, the strength of our brand and business portfolio and the focus on the turnaround have been brought to life through strong, resilient and agile execution in an ever-changing and fluid operating environment. We delivered outstanding top and bottom line results during the second quarter and first half of '21 both relative to the year ago period as well as 2019. We have gained considerable momentum on our turnaround.
Let me illustrate. We brought together a world-class leadership team who has helped unlock the passion of our people; we invested in omni-channel capabilities that have been instrumental in capturing consumer demand across all channels; substantially strengthened our innovation and marketing muscle, leveraging consumer insights and foresights; sharpened brand positioning for many of our top brands; established joint business plans with key strategic retail partners; instituted a new hybrid organization model that brings our domain experts close to our customers and consumers while leveraging the center for scale and efficiencies; made productivity a way of life, providing both fuel for margin enhancement as well as reinvestment in the business to drive sustainable and profitable top line growth; reduced complexity, be it consolidation of ERP systems or reduction in websites or SKUs; and we have made meaningful progress in taking our overheads, improving cash conversion cycle and strengthening the balance sheet. Importantly, we've become very skilled at managing our eight business unit portfolio and assigning clear roles to the individual businesses and some sub-businesses.
For instance, we focused on the Food, Commercial and Home Appliance business units in 2020 to leverage COVID-related consumer trends. And as some of these trends moderated, we are shoring up Writing and Home Fragrance in 2021. Our strategy is to ensure that the whole is greater than the sum of the parts. As we approach the second half, we faced a tough macro operating environment with unprecedented inflationary pressures that we expect will top $0.5 billion as well as extraordinary externally driven supply chain challenges.
Notwithstanding the situation, I am proud of our team's resilience, execution of progress and ingenuity, so much so that we raised our top line guidance for the year and continue to project normalized operating income and EPS growth on a full year basis. Looking ahead, I can confidently state that we are a much stronger company than before and well positioned to drive sustainable and profitable growth in the years ahead and add significant shareholder value. I'd like to express my sincere and profound gratitude to all our 31,000 employees and frontline [hires] worldwide for their tenacity in delivering another great quarter. Our best days are truly ahead of us. With that, over to Chris Peterson.
Now please go easy on him with the questions. It is his birthday. Happy birthday, Chris, onwards and upwards.