The increased demand for our products combined with the effect of macro level constraints on our production capabilities contributed to a record order backlog that varies by product category or region and is now 3 to 5 times our historical averages.
In Australia, this allowed us to realign over 40% of our strategic account customers and 80% of our distributor partnerships, ensuring that we have an optimized channel structure in place to serve this highly competitive market.
For the third quarter of 2021, Tennant reported net sales of $272 million, an increase of 3.9% over the prior year, which included a favorable foreign currency effect of 1.2% and a divestiture impact of negative 2% related to the sale of our Coatings business in the first quarter of 2021.
Organic sales, which exclude the impact of these currency effects and divestitures, increased 4.7%.
In the third quarter, sales in the Americas decreased 0.6% year-over-year, which included a negative divestiture impact of 3.1%, organic growth of 2% and a favorable foreign exchange effect of 0.5%.
Sales in EMEA increased 16.1% or 14% organically, including a favorable foreign exchange effect of 2.1%.
Sales in APAC decreased 0.4% or 2.9% on an organic basis and included a positive foreign exchange effect of 2.7% and a negative revenue impact of 0.2% related to the sale of the Coatings business.
Reported and adjusted gross margin in the third quarter were both 40.1% compared to a reported gross margin of 39.6% and adjusted gross margin of 39.8% in this year ago period.
As for expenses, during the third quarter, our adjusted S&A expenses were 28.3% of net sales compared to 29.3% in the year ago period.
Net income in the third quarter was $21.5 million or $1.14 per diluted share compared to $11.7 million or $0.63 per diluted share in the year ago period.
Adjusted diluted EPS, which exclude non-operational items and amortization expense was $1.33 per share compared to $0.90 per share in the year ago period.
Adjusted EBITDA in the third quarter increased to $36 million or 13.2% of sales compared to $32.6 million or 12.4% of sales in Q3 of last year.
As for our tax rate, in the third quarter, Tennant had an adjusted effective tax rate excluding non-recurring expenses of 3.8% compared to 11.3% for the third quarter of 2020.
We ended the quarter with $140.6 million in cash and cash equivalents and our net leverage of 0.93 times adjusted EBITDA is lower than our stated goal of 1.5 to 2.5 times.
Cash flow from operations was strong with $25.1 million generated in the third quarter and $62.9 million generated on a year-to-date basis.
Additionally, capex is approximately $12 million for the first nine months of the year.
First, and as previously announced, Tennant's Board of Directors has authorized a 9% increase in the company's quarterly cash dividend to $0.25 per share.
Secondly, during the third quarter, Tennant repurchased approximately 102,000 shares of its common stock for $7.5 million under its existing share repurchase program.
Net sales of $1.09 billion to $1.1 billion, reflecting organic sales growth of 9% to 10%.
Full year reported GAAP earnings in the range of $3.50 to $3.70 per diluted share.
Adjusted earnings per share of $4.20 to $4.40 per diluted share.
Adjusted EBITDA of $137 million to $142 million.
Capital expenditures of approximately $20 million.
And an adjusted effective tax rate of approximately 15%.

Summary:
For the third quarter of 2021, Tennant reported net sales of $272 million, an increase of 3.9% over the prior year, which included a favorable foreign currency effect of 1.2% and a divestiture impact of negative 2% related to the sale of our Coatings business in the first quarter of 2021.
Net income in the third quarter was $21.5 million or $1.14 per diluted share compared to $11.7 million or $0.63 per diluted share in the year ago period.
Adjusted diluted EPS, which exclude non-operational items and amortization expense was $1.33 per share compared to $0.90 per share in the year ago period.
Full year reported GAAP earnings in the range of $3.50 to $3.70 per diluted share.