Reported sales growth was 6.4%, organic sales growth -- grew 4.5% and exceeded our 4% Q2 outlook.
The 4.5% organic growth is impressive considering Q2 2020 organic sales growth was 8.4%.
Adjusted earnings per share was $0.76 and that's $0.07 better than our outlook.
We grew consumption in 13 of the 16 categories in which we compete, and in some cases on top of big consumption gains last year.
Another way to look at this is to compare our Q2 consumption on those 16 categories to 2019, a pre-COVID year, we have higher consumption in 14 of those 16 categories compared to Q2 2019.
Regarding brand performance, nine of our 13 brands saw a double-digit consumption growth and I'll name them for you: gummy vitamins, stain fighters, cat litter, condoms, battery powered toothbrushes, depilatories, dry shampoo sailing spray and water flossers.
Now although many of our brands delivered double-digit consumption growth it is not reflected in our 4.5% organic sales growth as shipments were constrained by supply issues which we do expect to lessen by Q4.
In Q2, online sales as a percentage of total sales was 14.2%.
Our online sales increased by 7% year-over-year.
But remember, this is on top of the 75% growth in e-commerce that we experienced in Q2 2020 versus '19.
We continue to expect online sales for the full year to be 15% as a percentage of total sales.
With 70% of American adults having at least one vaccine shots so far, the US has been opening up consumers becoming more mobile.
Consumer Domestic business grew organic sales 2.8%.
This is on top of 10.7% organic growth in Q2 2020.
Looking at market shares in Q2, five out of our 13 power brands met or gained share.
VITAFUSION gummy vitamins saw great consumption growth in Q2, up 10%.
In the last year, VITAFUSION household penetration is up 17%.
WATERPIK grew consumption 72% in Q2 as it continues to recover from COVID lows and benefits from the heightened consumer focus on health and wellness.
BATISTE dry shampoo grew consumption 37%.
Similarly TROJAN delivered 11% consumption growth.
In Q2, TROJAN launched on TikTok with explosive uptick from consumers with over 47 million views.
Despite intermittent lockdowns in our markets, our international business came through with 10.4% organic growth in the quarter, primarily driven by our strong growth in our Global Markets Group.
Our Specialty Products business delivered a positive quarter with 11.8% organic growth.
At the prior year quarterly organic growth for specialty products was 3%.
So 11.8% is an impressive result.
It's the first and only sanitizing laundry additive that boost stain fighting and eliminates 99.9% of bacteria and viruses.
WATERPIK launched WATERPIK ION, a water flosser which is 30% smaller with a long lasting lithium-ion battery.
To capitalize on its earlier success, WATERPIK SONIC FUSION, the world's first flossing toothbrush was upgraded to SONIC FUSION 2.0 with two brush head sizes and two speeds, and that's doing extremely well.
Since we last spoke to you in April, unplanned cost inflation has grown by another $35 million.
In addition to the price increases on 33% of our portfolio that we announced in April, we have just announced price increases on other categories, which means we have now priced up 50% of our portfolio.
We now expect to be at the lower end of our range of adjusted earnings per share growth of 6% to 8% as a result of heightened input costs.
Although we expect to be at the low end of the range, it's really important to remember that we are comping 15% earnings per share growth in 2020.
We expect full year reported sales growth of 5% with 4% full year organic sales growth.
We believe we are well positioned for 2022 with the pricing actions we have taken.
Second quarter adjusted EPS, which excludes the positive earn-out adjustment was $0.76, down 1.3% to prior year.
$0.76 was better than our $0.69 outlook primarily due to continued strong consumer demand for many of our products as well as a temporary reduction in marketing spend as supply chain shortages were impacting customer fill rates, which we expect to recover in Q4.
The $0.76 includes a $0.04 drag from a higher tax rate and a $0.04 drag from the VMS recall costs.
Reported revenue was up 6.4%.
Organic sales were up 4.5% driven by a volume increase of 4.3%.
Our second quarter gross margin was 43.4%, a 340 basis point decrease from a year ago.
This was right in line with our outlook for down 350 basis points for the quarter.
Gross margin was impacted by a 480 basis points of higher manufacturing costs primarily related to commodities, distribution, and labor costs.
Tariff costs negatively impacted gross margin by an additional 50 basis points.
These costs were partially offset by a positive 40 basis point impact from price volume mix and a positive 140 basis point impact from productivity programs as well as a ten basis point positive impact from currency.
Moving to marketing, marketing was down $5.3 million year-over-year as we lowered spend to reduced demand until fill rates could recover.
Marketing expense as a percentage of net sales decreased 100 basis points to 9.2%.
We continue to expect full year marketing expense as a percentage of net sales to be approximately 11.5% in line with historical averages.
For SG&A, Q2 adjusted SG&A decreased 140 basis points year-over-year with lower legal costs and lower incentive comp.
Other expense all in was $11.4 million, a $3.3 million decline to the lower interest expense from lower interest rates.
And for income tax, our effective rate for the quarter was 24% compared to 19.6% in 2020, an increase of 440 basis points, primarily driven by lower stock option exercises.
For the full -- for the first six months of 2021 cash from operating activities decreased 42% to $344 million due to higher cash earnings being offset by an increase in working capital.
As a reminder, in the year-ago numbers there was an $80 million benefit in Q2 related to the timing of US federal income tax payments shifting from the second to the third quarter in the prior year.
We expect cash from operations to be approximately $90 million for the full year.
As of June 30th, cash on hand was $149.8 million.
Our full year CapEx plan is now $140 million as we continue to expand manufacturing and distribution capacity, primarily focused on laundry, litter, and vitamins.
The decrease from our previous $180 million is project timing related.
For Q3 we expect reported sales growth of approximately 3%, organic sales growth of approximately 1.5% entirely due to supply chain constraints.
Adjusted earnings per share is expected to be $0.70 per share, flat from the last year's adjusted EPS.
And now for the full-year outlook, we now expect full-year 2021 reported sales growth to be approximately 5%, organic sales growth to be approximately 4%.
Turning to gross margin, we now expect full year gross margin to be down 75 basis point.
Our April outlook expected gross margin to be flat for the year, and $90 million of inflation from our original guidance.
Now we're absorbing $125 million of incremental costs for the full year.
This additional $35 million of inflation drives the change in our gross margin outlook.
We've taken another round of pricing actions with over 50% of our global brands having announced price increase.
The $35 million movement versus our previous outlook is primarily non-commodity related, transportation, labor, third-party manufacturers, and other raw material price increases make up the majority.
And while we have 80% of our commodities hedged, let me give you a sense of what's going on with major commodities.
For example, previously in our forecast it was based on HDPE being up 30% in the second half of the year, now it's up 60%.
Polypros [Phonetic] moved from being up 40% to now 90%.
We previously expected second half diesel to be up 18% and now it's of 27%.
Our full year tax rate expectations are now 23%, higher versus our last expectations due to lower stock option exercises.
This is a $0.04 drag versus our previous outlook.
We now expect adjusted earnings per share to be at the lower end of our previous range of 6% to 8%.
Our brands continue to go from strength to strength as strong consumption in organic sales growth lapped almost 10% organic growth a year ago.

Summary:
Adjusted earnings per share was $0.76 and that's $0.07 better than our outlook.
We now expect to be at the lower end of our range of adjusted earnings per share growth of 6% to 8% as a result of heightened input costs.
We expect full year reported sales growth of 5% with 4% full year organic sales growth.
We believe we are well positioned for 2022 with the pricing actions we have taken.
Second quarter adjusted EPS, which excludes the positive earn-out adjustment was $0.76, down 1.3% to prior year.
$0.76 was better than our $0.69 outlook primarily due to continued strong consumer demand for many of our products as well as a temporary reduction in marketing spend as supply chain shortages were impacting customer fill rates, which we expect to recover in Q4.
The $0.76 includes a $0.04 drag from a higher tax rate and a $0.04 drag from the VMS recall costs.
And now for the full-year outlook, we now expect full-year 2021 reported sales growth to be approximately 5%, organic sales growth to be approximately 4%.
We now expect adjusted earnings per share to be at the lower end of our previous range of 6% to 8%.