Steven A. Cahillane
Chairman Of The Board & Chief Executive Officer at Kellanova
Thanks, Amit. Before we get into each of the four regions, let me start off by highlighting the strength of some of our most important growth drivers. The first is Pringles, shown on slide number 18. This $2 billion global retail sales brand continues to perform well around the world. Here in the United States, it continued to outpace the category on consumption growth using a two -year CAGR to eliminate uneven comparisons. It's also outperforming the category on household penetration gains since the pandemic. And around the world, we are seeing similar momentum.
We're seeing growth in original and core flavors. We're seeing incremental growth from innovations like Scorchin and Sizzl'n. Equally impressive has been Cheez-It, another world-class brand, shown on slide number 19. This $1 billion retail sales brand continues to perform well in the U.S. Its two -year CAGRs remain well ahead of the category's growth and its household penetration has grown in contrast to the rest of the category. Meanwhile, our launches of this power brand into Canada and Brazil are off to strong starts.
Let's not overlook two other world-class snack brands. On slide number 20, we can see the continued strength of Pop-Tarts and Rice Krispies Treats. Together, these two power brands represent $1 billion in measured channel retail sales in the U.S. alone. You can see from the slide that they are in terrific shape as well. Their consumption has continued to outpace the portable wholesome snacks category on a two -year CAGR basis, and these brands have added households since the pandemic, whereas the overall category has not. Plant-based protein and our leading MorningStar Farms brand is another growth driver that is performing very well. As shown on slide number 21, this $400 million retail sales brand continues to show strong consumption growth on a two -year CAGR basis and has continued to add to its household penetration.
A key advantage of MorningStar Farms is the breadth of its offerings across product types. And in Q2, we continued to see double-digit two -year CAGRs across segments like chicken, appetizers, breakfast meat and sausages. We continue to innovate against this brand, including its sub-brand Incogmeato, which continues to add distribution and share and is proving to be incremental to the MorningStar Farms franchise. MorningStar Farms growth has bumped up against our capacity at various times in the past year, even as it has faced numerous new entrants into the category. This is creating a lot of excitement in the category, and we are pleased with our momentum and prospects. And of course, there's Eggo, shown on slide number 22. This $900 million retail sales brand continues to perform well in the U.S. as indicated by its strong two -year compound annual growth in consumption and by its better-than-category performance on household penetration.
Meantime, the brand continues to grow on a two -year basis in Canada and Mexico as well. Our emerging markets are another key growth driver for us. And as you can see on slide number 23, they have actually accelerated their growth over the past couple of years. As we've discussed many times, this is a testament to our geographic footprint, our portfolio of foods and brands, our local supply chains, our go-to-market and our experienced management teams. As you can see from the chart, we continued to record impressive growth in these markets in Q2, even in spite of challenges related to COVID. We grew strongly in Africa, Asia, Latin America and Russia, and we continue to grow in cereal, snacks and noodles. Emerging markets represent more than 20% of our net sales and are expected to remain an important growth driver for a long time to come.
So some of our portfolio's most important growth drivers are very clearly showing good momentum and have only strengthened over the past year. And these aren't small businesses. Even just the ones I discussed here, collectively represent more than half of our company's net sales. Let's now discuss each of our regions. We'll start with North America in slide number 24. We sustained net sales growth on a two -year basis in North America, even if that growth rate was held back by the pandemic's negative impact on away-from-home channels and on-the-go pack formats. Moreover, versus last year, our volume in Q2 was not only lapping last year's double-digit surge, but also felt the impact of our previously discussed shift of shipments into Q1 and resultant trade inventory coming out as expected during Q2. Importantly though, we realized good price mix growth driven by revenue growth management actions.
And our overall sales growth was supported by good underlying consumption trends. We outpaced four of our six primary categories on a two -year compound annual growth basis with our two -year consumption growth accelerating sequentially from Q1 in five of our six categories. And as we discussed on the past few slides, this strong performance is being driven by many of our biggest brands. So the underlying fundamentals look good. On operating profit, remember that we were lapping a year ago quarter in which operating profit grew 36%, excluding divestiture impact, an unusually strong quarter elevated by at-home demand, outsized operating leverage and delayed brand investment during the height of the pandemic. On a two -year CAGR basis though, you can see we continued to generate good operating profit growth driven by top line growth, productivity and price/mix.
These have been able to offset the impacts of extremely high cost inflation this year as well as the frequent shortages of materials, freight and labor, which are most pronounced in North America. Let's take a closer look at our category groups in North America. slide number 25 shows that our net sales for snacks in North America continued to grow both on a one-year and a two -year CAGR basis, despite declines in away-from-home channels and many on-the-go foods and pack formats. U.S. consumption remains solid on a two-year CAGR basis, outpacing all three of our snacks categories and led by power brands. In crackers, we outpaced the category on a one-year and two-year CAGR basis, led by continued strength in Cheez-IT and Club. In salty snacks, we outpaced the category on a one-year and two-year CAGR basis as well due to continued strength in Pringles, particularly its core four flavors, its new Scorchin innovation and multi-packs.
And in portable wholesome snacks, we are seeing brands like Pop-Tarts and Rice Krispies Treats hold up very well on a two -year CAGR basis, while also starting to see signs of recovery in our more on-the-go oriented brands, like Special K, Nutri-Grain and RXBARs. In North America cereal, shown on slide number 26, organic net sales were off slightly on a two -year CAGR basis due to declines in away-from-home channels. We also saw the impact of being capacity constrained on certain brands. In the U.S., the category's consumption was flat on a two -year CAGR basis in Q2. And after being down about 1% in Q1, we improved to flat in Q2, keeping up with the category on that basis. Frosted Flakes accounted for most of the share decline related to pulling back on brand building and merchandising since Q4 last year, as we worked to maintain service levels and add capacity planned prior to the pandemic. Unfortunately, our capacity expansion has been slowed by current supply shortages and by our recent fire in one of our facilities.
This will delay our return to normal commercial activity on affected brands. In the meantime, our business continues to progress well. We continue to lead the category and share of innovation, and we are seeing better performance in wellness-oriented brands, like Raisin Bran, Special K, Kashi and Bear Naked. And on slide number 27, we can see that our two frozen businesses, plant-based foods and frozen breakfast, also continue to grow on a two -year CAGR basis, even despite capacity limitations and declines in away-from-home channels. We've already discussed both of our key brands in frozen, MorningStar Farms plant-based foods and Eggo from the griddle foods. Both continue to generate strong consumption growth on a two -year CAGR basis, and both are poised to sustain growth. And before we move on from our discussion of North America, we should touch on our U.S. away-from-home business in slide number 28. The slide shows rolling two -year average growth rates in our net sales over the past few quarters in these channels.
As restrictions eased and consumer mobility increased, we saw a gradual recovery get underway in these channels. It remains to be seen whether this trajectory will continue given recent pandemic developments. So our North America region continues to perform well even as we work to catch up the demand and work our way through industry-wide shortages of freight, labor and materials. Now let's take a look at Europe, shown on slide number 29. Kellogg Europe posted its 15th consecutive quarter of organic growth, a remarkable track record of consistency in this market. Volume had to lap a year ago surge, but we sustained good price/mix growth driven by RGM actions. And on a two -year CAGR basis, you can see that we remain in strong net sales growth with this growth being driven by both snacks and cereal. Importantly, we also continue to perform well in market. Retail scanner data indicate only modest sequential deceleration of category and Kellogg consumption growth on a two -year CAGR basis.
On that two -year CAGR basis, we kept up with the salty snacks category with particular recent strength in France and Spain. Our consumer promotion around the Euro's soccer tournament was our biggest summer promo ever for Pringles. In cereal, our two -year growth has outpaced the category in most markets, led by key brands like Crunchy Nut in the U.K. and Tresor and Extra in Continental Europe, and Coco Pops and Cocoa Krispies more broadly. Europe's operating profit lapped a year ago quarter in which operating profit grew more than 35% when it was elevated by at-home demand, outsized operating leverage and delayed brand investment during the height of the pandemic. Nevertheless, on a two -year CAGR basis, we grew our profit at a double-digit rate in Q2. So clearly, Kellogg Europe continues to perform very well.
Moving to Latin America in slide number 30. Latin America had a notably strong quarter. It grew organic net sales by 9% on top of last year's 14% gain, resulting in strong double-digit growth on a two -year CAGR basis. Volume had to lap last year's 11% surge and this was felt primarily in cereal, but we sustained strong price/mix growth, driven by RGM actions across the portfolio and markets. The result was a year-on-year net sales growth in all subregions and as shown on the slide, sustained momentum on a two -year CAGR basis. Scanner data do indicate a gradual slowing of at-home demand, which for us manifests itself in cereal. Nevertheless, our two -year CAGRs for consumption remains strong in our key cereal markets, with Kellogg exceeding category growth rates, particularly for big brands like Corn Flakes and Froot Loops.
Similarly, Pringles outpaced two -year CAGRs for salty snacks categories in key markets and has gained share on a one-year basis in our biggest markets, Mexico and Brazil. Meanwhile, our Parati business in Brazil continued to post strong consumption growth and increased share in biscuits. While operating profit had to lap a near doubling in the year earlier quarter, it was still up strongly on a two -year CAGR basis. Despite high cost, they were heightened further by adverse transactional currency exchange. We clearly are performing well in this region. And while we are somewhat cautious about decelerating at-home demand and further regulatory pressure in the second half, this year is certainly shaping up to be a good one for Kellogg Latin America. And we'll conclude our regional discussion with AMEA in slide number 31. AMEA produced another quarter of exceptional organic net sales growth, both on a one-year and two -year CAGR basis.
Both volume and price/mix contributed to the strong year-on-year growth. Geographically, the growth was broad-based and driven by emerging markets. It was led by double-digit gains in Africa. Within Africa, we experienced notably exceptional growth in Nigeria. Our business there has been dependently in growth for a long time, and its recent acceleration and momentum has been impressive. Meanwhile, we also generated good growth elsewhere in Africa and in the Middle East. We generated double-digit organic net sales growth in Asia as well, and the gains were broad-based across markets like India, Japan and Korea, and the growth came from both snacks and cereal. Even in developed market, Australia, our sales were roughly flat against last year's surge. AMEA's operating profit growth was also outstanding in Q2, growing 25% year-on-year.
So AMEA continues to demonstrate strong momentum, and while we would not expect it to keep up this exceptional rate of growth, it is very clearly a dependable growth driver for us. Allow me to wrap up with a brief summary on slide number 33. We have completed another quarter of strong execution and performance, capping a first half that featured the following: Underlying business momentum, driven by our biggest brands; unlocking capacity so we can resume full commercial activity in certain products; sustained growth momentum in emerging markets; leveraging enhanced capabilities from data and analytics, to innovation, to ESG; strong cash flow and balance sheet, providing financial flexibility and increased cash to shareowners; a continuation of balanced financial delivery; and an affirmation of our full year guidance, as top line momentum helps offset the impact of higher cost pressures and global supply chain obstacles.
As I mentioned earlier, the current business environment is anything but business as usual. In addition to the challenges of ensuring our employees' safety, we and the entire economy are wrestling with tight supply of materials, freight and labor as well as the related rise in their costs. We managed through this environment very effectively in the first half, and we affirm guidance today with confidence that we will continue to manage through it in the second half. We remain as convinced as ever that we are stronger today as a company. So before closing, I want to thank our Kellogg employees for their dedication and hard work in what have been incredibly challenging circumstances.
And with that, we'd be happy to take any questions you might have.
