Organic sales rose 18%, and adjusted diluted earnings per share grew an even stronger 31%.
Encouragingly, relative to the pre-pandemic first quarter of fiscal year 2020, our business is 13% larger on a reported basis and more profitable.
13 brands contributed double-digit organic sales growth, demonstrating the breadth of strength across our portfolio.
Despite this, the region still grew 10% organically driven by strength in Greater China and Korea.
The ELC Cares Employee Relief Fund awarded nearly 14,000 grants and distributed nearly $8 million through June 30, 2021.
For the second year in a row, we sourced 100% renewable electricity globally for our direct operations and achieved net-zero scope one and scope two emissions.
We achieved our existing post-consumer recycled content goal ahead of schedule and announced a more ambitious goal to increase the amount of such material in our packaging to 25% or more by the end of calendar year 2025.
We also committed to reduce the amount of virgin petroleum plastic in our packaging to 50% or less by the end of calendar year 2030.
The Estée Lauder Companies will contribute $3 million over three years to support Writing Change, a special initiative to advance literacy as a pathway to equality, access, and social change.
Our confidence in the long-term growth opportunities for global prestige beauty and our company is reflected in the announcement today to raise the quarterly dividend.
We are off to an outstanding start with first-quarter net sales growing 18% organically, driven by the nascent recovery in the Americas and EMEA during the quarter compared to a more difficult environment in the prior year.
We estimate that this contributed approximately 1.5 points to our first-quarter sales growth that otherwise would have occurred in the second quarter.
From a geographic standpoint, organic net sales in the Americas climbed 27% as COVID restrictions eased throughout the region.
With the strong resurgence of brick-and-mortar traffic, online organic sales growth in the Americas declined single digits against a sharp increase last year, while organic online penetration remained solid at 31% of sales.
In our Europe, the Middle East, and Africa region, organic net sales rose 19% with virtually every market contributing to growth, led by the emerging markets in the Middle East, Turkey, and Russia as well as the U.K. Most markets throughout the region saw COVID restrictions lifted, and some tourism resumed during the peak summer months.
Summer holiday travel in Europe and the Americas picked up, but international travel still reached only 40% of pre-COVID levels.
In our Asia Pacific region, organic net sales rose 10%, driven by Greater China and Korea.
And the pace of online sales growth slowed following the successful 6.18 programs last quarter and in anticipation of the 11.11 shopping festival.
From a category perspective, net sales growth in fragrance jumped nearly 50%.
Net sales in makeup rose 18% as markets in the Americas and Europe began to recover from COVID shutdowns.
However, makeup sales in the quarter were still 19% below two years ago.
Organic net sales grew 12%, and the inclusion of sales from DECIEM added six percentage points to reported growth.
Our haircare net sales rose 8% as traffic in salons and stores in the U.S. and Europe began to return.
Our gross margin declined 100 basis points compared to the first quarter last year.
Operating expenses decreased 240 basis points as a percent of sales.
Our operating income rose 32% to 941 million, and our operating margin rose 140 basis points to 21.4% in the quarter.
Diluted earnings per share of $1.89 increased 31% compared to the prior year.
During the quarter, we used 81 million in net cash flows from operating activities, which was below the prior year.
We invested 205 million in capital expenditures as we ramped up our investment to build a new manufacturing facility in Japan.
And we returned 749 million in cash to stockholders through both share repurchases and dividends.
This is causing us to experience inflation in freight and procurement, which we expect to impact our cost of goods and operating expenses beginning next quarter.
For the full fiscal year, organic net sales are forecasted to grow 9 to 12%.
Based on rates of 1.163 for the euro, 1.351 for the pound, and 6.471 for the Chinese yuan, we expect currency translation to be negligible for the full fiscal year.
Diluted earnings per share is expected to range between 7.23 and 7.38 before restructuring and other charges.
This includes approximately $0.04 of accretion from currency translation and $0.03 accretion from DECIEM.
In constant currency, we expect earnings per share to rise 11 to 14%.
At this time, we expect organic sales for our second quarter to rise eight to 10%.
We expect second quarter earnings per share of $2.51 to $2.61.
Notably, our earnings per share forecast also reflects a 23% tax rate, compared to 15.9% in the prior year when we benefited from certain one-time items.

Summary:
Our confidence in the long-term growth opportunities for global prestige beauty and our company is reflected in the announcement today to raise the quarterly dividend.
Diluted earnings per share of $1.89 increased 31% compared to the prior year.
This is causing us to experience inflation in freight and procurement, which we expect to impact our cost of goods and operating expenses beginning next quarter.
For the full fiscal year, organic net sales are forecasted to grow 9 to 12%.
We expect second quarter earnings per share of $2.51 to $2.61.
Notably, our earnings per share forecast also reflects a 23% tax rate, compared to 15.9% in the prior year when we benefited from certain one-time items.