Ken Giacobbe
Executive Vice President and Chief Financial Officer at Howmet Aerospace
Thank you, John. Let's move to Slide 5. All markets continue to be healthy with revenue in the third quarter, up 16% year-over-year and 1% sequentially. As expected sequential revenue growth was impacted by normal third quarter seasonality. Commercial aerospace increased 23% year-over-year, driven by all three aerospace segments. Commercial Aerospace has grown for 10 consecutive quarters and stands at 49% of total revenue. Commercial Aerospace growth continues to be robust supported by demand for new more fuel-efficient aircraft as well as increased spares demand.
Defense Aerospace was up 13% year-over-year driven by the F-35 and Legacy Fighter programs. Commercial Transportation which impacts both forged wheels in the Fastening Systems segment was up 7% year-over-year driven by higher volumes.
Commercial Transportation remains resilient, despite normal seasonality. Finally, the industrial and other markets were up 10% year-over-year driven by oil and gas up 29%, General Industrial up 8% and IGT up 4%, in summary, another very strong quarter across all of our end markets.
Now let's move to Slide 6, for more details on the third quarter results. Starting with the P&L and enhanced profitability revenue, EBITDA, EBITDA margin and earnings per share all exceeded the high-end of guidance.
Revenue was $1.658 billion up 16% year-over-year. EBITDA was $382 million up 18% year-over-year, while absorbing near-term costs associated with net headcount conditions of approximately 645 employees.
The Engine segment drove a majority of the increase by adding approximately 500 employees. Year-to-date net debt count additions are just over 1500 employees. We continue to increase headcount for the expected revenue ramp. EBITDA margin was strong at 23%, despite absorbing the headcount additions.
Adjusting for year-over-year inflationary cost pass-through of approximately $15 million EBITDA margin was 23.3% in the flow-through of segment incremental revenue to EBITDA was at approximately 28% year-over-year which is right in line with our guidance.
Earnings per share, was strong at $0.46 per share, up 28% year-over-year. The third quarter reason represents the ninth consecutive quarter with growth in revenue EBITDA and earnings per share.
Next is the balance sheet. The balance sheet continues to strengthen, while returning cash to key stakeholders. The ending cash balance was $425 million after generating $132 million of free cash flow.
In the quarter, $242 million of cash on hand was allocated to debt reduction, common stock repurchases and dividends. Net debt to EBITDA improved to a record low, of 2.3 times. All bond debt is unsecured and at fixed rates which will provide stability of interest rate expense in the future.
Our next bond maturity of $705 million is due in October of 2024. Howmet's improved financial leverage and strong cash generation were reflected in Fitch's August credit upgrade from BBB- to BBB, two notches into investment grade.
Moreover Moody's upgraded Howmet's outlook from stable to positive in September. The balance sheet continues to strengthen and is recognized with the rating agency upgrades.
Finally, moving to capital allocation, we continue to be balanced in our approach. In the quarter capital expenditures were $59 million which continues to be less than depreciation and amortization. In the third quarter we reduced debt by another $200 million. Year-to-date, we have reduced debt by approximately $376 million, which will lower annualized interest expense by approximately $19 million. We also repurchased $25 million of common stock in the third quarter at an average price of $49.32 per share. This was the 10th consecutive quarter of common stock repurchases.
Share buyback authority from the Board stands at $797 million. Since separation in 2020, we have repurchased more than $1 billion of common stock. We exited the third quarter with a diluted share count of 414 million shares.
Finally, we continue to be confident in free cash flow. In the third quarter, the quarterly stock dividend was $0.04 per share. The quarterly stock dividend will be increased by 25% in the fourth quarter to $0.05 per share.
Now let's move to slide 7 to go through the segment results for the third quarter. The Engine Products segment continued its strong performance. Revenue was $798 million, an increase of 17% year-over-year. Commercial aerospace was up 15% and Defense Aerospace is up 33% with both markets driven by higher build rates and spares growth. Oil and gas was up 33% and IGP was up 4% as demand continues to be strong.
As expected, Q3 sequential revenue was down 3% driven by seasonal vacations. EBITDA increased 18% year-over-year to $219 million. The EBITDA margin increased 20 basis points both year-over-year and sequentially to 27.4%, while absorbing approximately 500 net new employees. We are pleased with the continued strong performance of the engines team.
Now let's move to slide 8. Fastening Systems year-over-year revenue increased 20%. Commercial aerospace was up 34%, including the impact of the emerging wide-body recovery. Commercial Transportation was up 6%. General Industrial was up 7% and Defense Aerospace was down 5%. Year-over-year segment EBITDA increased 19% EBITDA margin was 21.8% and is improved 320 basis points over the last two quarters.
Please move to slide 9. Engineered Structures year-over-year revenue was up 18% with commercial aerospace up 33%, driven by build rates and approximately $30 million of Russian titanium share gain. Defense Aerospace was down 20% year-over-year. Sequentially, Engineered Structures improved production rates and revenue was up 14%, which was in line with our expectation of 10% to 15%.
Segment EBITDA increased 7% year-over-year. Sequentially EBITDA margin improved 320 basis points to 13.2% despite absorbing approximately 145 net new employees in the third quarter. Q3 was good recovery by the structures team and we continue to expect further improvement in margins.
Let's move to slide 10. Forged Wheels year-over-year revenue increased 7%. The $19 million increase in revenue year-over-year was driven by a 13% increase in volume, partially offset by lower aluminum prices. Segment EBITDA increased 20% year-over-year driven by the higher volumes. EBITDA margin increased 290 basis points primarily due to the impact of higher volumes and lower aluminum prices.
Finally, let's move to slide 11. Our balance sheet continues to be a source of strength with healthy cash flow supporting a $200 million debt reduction in Q3. The $1.25 billion October 2024 debt tower was inherited from Alcoa Inc. and has been reduced to $705 million with cash on hand. Since the separation in 2020, we have paid down gross debt by approximately $2.15 billion with cash on hand and have lowered annualized interest costs by more than $120 million. Gross debt now stands at $3.8 billion. All long-term debt continues to be unsecured and at fixed rates. We will continue to focus on improving our capital structure and liquidity.
Lastly, before turning it back to John, let me highlight one item. In the appendix slide 18 covers our operational tax rate which was approximately 22.8% year-to-date. The midpoint of our guidance represents a 500 basis point improvement in the operational tax rate since the separation in 2020. Strong performance by the tax [Indecipherable] and we continue to be focused on further improvements in our operational tax rate.
Now, let me turn it back to John for the outlook and summary.