As you know, our Q4 growth rates were impacted by the unprecedented demand we experienced in 2020 when at-home food consumption surged due to the onset of the pandemic and organic net sales increased 21.5%.
And as you can see, on a two-year CAGR basis, organic net sales for the fourth quarter increased by more than 4% and our two-year adjusted earnings per share grew by more than 22%.
Growth in our $1 billion e-commerce business continued in fiscal 2021, both against our peers and as a percentage of our overall retail sales.
E-commerce sales now represent nearly 8% of our total retail sales.
Total Conagra retail sales grew an impressive 11.7% on a two-year basis in the fourth quarter with contributions from each of our retail domains.
On a two-year basis, we delivered double-digit growth rates in retail sales across our frozen and snacking domains and a solid 5.2% growth rate in staples.
All in, our strategic frozen business grew 13.5% over the two-year period ending in fiscal 2021.
Our snacks business has seen similar success, delivering strong two-year retail sales growth of 21% in fiscal '21, led by increases of more than 25% across hot cocoa, microwave popcorn, ready-to-eat pudding, and meat snacks.
Staples retail sales increased 5.2% over the past two years, spurred by steady growth across key staples categories.
Organic net sales growth is expected to be roughly flat to fiscal '21.
This results in a CAGR over the three years ending fiscal '22 of approximately 3.5%, compared to our original target of 1% to 2%.
Adjusted operating margin is expected to be approximately 16%, and adjusted earnings per share is expected to be approximately $2.50.
We delivered strong growth for the full fiscal year, including a 5.1% increase in organic net sales; adjusted operating profit of nearly $2 billion, up 7.4% versus fiscal '20; and operating margin of 17.5% for the year, an increase of more than 100 basis points versus fiscal '20; an adjusted EBITDA increase of 6.5%; and adjusted earnings per share growth of 15.8% for the year.
Our 10.1% decrease in organic net sales during the quarter was driven by a 12.8% decline in volume due to the comparison to last year's demand surge.
The impact of the volume decline was partially offset by a 2.7% benefit from favorable mix and the initial pricing actions we took in response to the elevated inflationary environment, which I will describe in further detail shortly.
Divestitures drove a 150-basis-point decline to net sales for the quarter, and we faced an additional headwind of 560 basis points from the lapping of last year's 53rd week.
Finally, we experienced a 50 basis point benefit from foreign exchange during the quarter.
Combined, these factors drove a 16.7% decline in net sales for the quarter compared to a year ago.
The bottom half of the slide highlights the drivers of our net sales growth for full-year fiscal '21 versus the prior year with an increase in organic net sales of over 5% driven by volume growth and favorable price mix actions.
As you can see, our team did a great job pulling on our margin levers in the quarter, including taking price increases in several retail categories driving favorable mix throughout the portfolio, capturing $20 million of synergies associated with the Pinnacle Foods acquisition, managing our COVID-19-related costs, which were $36 million in the quarter and continuing to drive strong supply chain productivity.
COGS inflation continued to accelerate as the quarter progressed, ultimately landing at 8.6%, which was above the Q4 expectations we shared at the end of Q3.
We also increased our A&P by 27% in the quarter as we continue to identify opportunities for strong ROIs on these investments, particularly within e-commerce.
As I noted earlier, our adjusted earnings per share of $0.54 was in line with our expectations despite higher-than-expected inflation.
The decline in adjusted operating profit and the impact of last year's 53rd week affected our results by $0.23 and $0.05, respectively, shown here on Slide 35.
We ended the year with a net debt to EBITDA ratio of 3.6 times, which is in line with our fiscal '21 target.
During fiscal '21, we increased CAPEX by more than $130 million compared to the prior year and funded important capacity and productivity projects.
We also repurchased nearly $300 million worth of shares and paid $475 million in dividends in fiscal '21.
Given the timing of the closure, this sale had a minimal impact on our Q4 results, but we expect there to be an annualized net sales impact of roughly $40 million going forward.
We estimate that the sale will have a total annualized impact on our earnings per share of approximately $0.01.
For fiscal '22, we now expect organic net sales growth approximately flat to fiscal '21, adjusted operating margin of approximately 16%, and adjusted earnings per share of approximately $2.50.
When we initially gave our fiscal '22 targets at our Investor Day in April of 2019, our models assumed an annual inflation rate of around 3%.
At the time of our third-quarter call in April of 2021, we expected fiscal '22 inflation to come in at twice that level around 6%.
We now currently expect fiscal '22 inflation to come in around 9%.
The difference between the 6% we expected a few months ago and the 9% we expect today equates to approximately $255 million in additional costs during fiscal '22.
For example, certain pricing actions can take 90 days to enact or a cost savings initiative may not be actionable until later in the year when a contract is up for review.
First, consistent with our prior divestitures, we are removing $0.01 for the Egg Beaters divestiture that we announced today.
Second, the largest driver of the change is the significant $0.41 per share increase in inflation since Q3 that I just discussed.
I'm pleased that our strong balance sheet and our confidence in the long-term health and profitability of the business have put us in a position to raise our quarterly dividend to $0.3125 or $1.25 on an annualized basis beginning in September.
This new dividend level represents a 50% payout ratio based on our fiscal '22 earnings per share guidance, which is in line with our longer-term targets.
As some of you remember, when we sold our private label business in 2016, we incurred a tax capital loss of approximately $4 billion that we could apply as a carryforward to offset capital gains generated through fiscal year-end '21.

Summary:
Organic net sales growth is expected to be roughly flat to fiscal '21.
Adjusted operating margin is expected to be approximately 16%, and adjusted earnings per share is expected to be approximately $2.50.
The impact of the volume decline was partially offset by a 2.7% benefit from favorable mix and the initial pricing actions we took in response to the elevated inflationary environment, which I will describe in further detail shortly.
As I noted earlier, our adjusted earnings per share of $0.54 was in line with our expectations despite higher-than-expected inflation.
For fiscal '22, we now expect organic net sales growth approximately flat to fiscal '21, adjusted operating margin of approximately 16%, and adjusted earnings per share of approximately $2.50.
Second, the largest driver of the change is the significant $0.41 per share increase in inflation since Q3 that I just discussed.