Our bookings were up 60% compared to Q2 2020 and were a new record for the third consecutive quarter.
Q2 revenue was up 28% compared to the second quarter of 2020 and up 14% sequentially and to a record $196 million.
Our aftermarket parts and consumables revenue was also up 28% compared to the same period last year and up 6% sequentially to a record $125 million in Q2.
Solid execution contributed to boosting our adjusted EBITDA margin to 21% which led to a record operating cash flows of $44 million in Q2.
Bookings and revenue were up 45% and 38%, respectively, compared to the same period last year and parts made up 65% of total revenue in the second quarter.
Improved operating leverage led to a record adjusted EBITDA and an adjusted EBITDA margin of nearly 30%.
Our Industrial Processing segment continued to experience strong demand with bookings in this segment up 92% to a record $102 million.
Strong end market demand for wood products continued throughout the quarter as U.S. housing starts increased 23% in June 2021 compared to June 2020.
Although housing starts were down 5% from May to June of this year, overall demand for housing and wood products is high and is expected to remain strong throughout the second half of 2021.
Revenue in this segment increased 26% to $83 million with parts and consumables leading to growth, up 32% compared to the same period last year and 11% sequentially.
A favorable product mix and good execution led to a 340 basis point improvement in our adjusted EBITDA margin.
Revenue in the second quarter was up 18% to $42 million and parts and consumables revenue was strong, making up 60% of total revenue.
Although not a record, total bookings were up 29% at the top end of our historical bookings.
Solid execution by our businesses in this segment helped boost our EBITDA by 30% and adjusted EBITDA margin by 180 basis points to its highest level since Q4 of 2019.
Consolidated gross margins were 43.6% in the second quarter of 2021 compared to 43.5% in the second quarter of 2020.
Our parts and consumables revenue represented 64% of revenue in both periods.
SG&A expenses were $49.3 million and 25.2% of revenue in the second quarter of 2021 compared to $45.1 million and 29.5% of revenue in the second quarter 2020.
The $4.2 million increase in SG&A expenses includes a $2.6 million unfavorable foreign currency translation effect and increases in incentive compensation outside labor and travel-related costs due to improved business conditions.
We received $1 million from the government assistance programs in the second quarter of 2021 compared to $0.8 million in the second quarter of 2020.
Our GAAP diluted earnings per share was a record $1.96 in the second quarter, up 96% compared to $1 in the second quarter of 2020.
Adjusted EBITDA increased 56% to $41.3 million or 21.1% of revenue compared to $26.6 million or 17.4% of revenue in the second quarter of 2020 due to strong performance in our Flow Control and Industrial Processing segments.
I would like to note that both adjusted EBITDA of $41.3 million and the 21.1% of revenue were records.
Operating cash flow increased 101% to a record $44.4 million in the second quarter of 2021 compared to $22 million in the second quarter of 2020.
Free cash flow was also a record at $42.3 million in the second quarter of 2021 compared to $21.1 million in the second quarter of 2020.
During the quarter, we were able to utilize our strong cash flows to pay down our existing debt by $27 million.
We borrowed $78.7 million at the end of the second quarter to fund the third quarter acquisition of Clouth.
We also paid $2.1 million for capital expenditures and paid a $2.9 million dividend on our common stock.
In the second quarter of 2021, our GAAP diluted earnings per share was $1.96, and after adding back acquisition costs of $0.05 our adjusted diluted earnings per share was $2.01.
In the second quarter of 2020, our GAAP diluted earnings per share was $1, and our adjusted diluted earnings per share was $1.06.
The $0.06 difference includes restructuring costs of $0.03 and acquisition costs of $0.03.
As shown in the chart, the increase of $0.95 in adjusted diluted earnings per share in the second quarter of 2021 compared to the second quarter of 2020 consists of the following: $1.15 due to higher revenue, $0.08 due to higher gross margin percentage and $0.05 due to lower interest expense.
These increases were partially offset by $0.27 due to higher operating expenses, $0.04 due to a decrease in the amounts received from government assistance programs and $0.02 due to higher weighted average shares outstanding.
Collectively, included in all the categories I just mentioned, was a favorable foreign currency translation effect of $0.16 in the second quarter of 2021 compared to the second quarter of last year due to the weakening of the U.S. dollar.
Our cash conversion days, which we calculate by taking days in receivables plus days in inventory subtracting days in accounts payable decreased to 109 at the end of the second quarter of 2021 and compared to 128 at the end of the second quarter of 2020.
Working capital as a percentage of revenue was 12.7% in the second quarter of 2021 compared to 14.8% in the second quarter of 2020.
Our net debt, that is debtless cash, decreased $40 million or 26% sequentially to $116 million at the end of the second quarter 2021.
We paid down $27 million of our debt in the quarter.
And as previously mentioned, we also borrowed $79 million of debt at the end of the second quarter to fund our acquisition of Clouth, which was largely completed in mid-July.
We borrowed an additional $4 million at the end of July associated with the acquisition of the remaining legal entity, which we expect will be completed in mid-August.
Our leverage ratio calculated in accordance with our credit agreement increased to 1.71% at the end of the second quarter of 2021 compared to 1.5% at the end of the first quarter of '21.
Our net interest expense decreased $0.9 million or 47% to $1 million in the second quarter of 2021, compared to $1.9 million in the second quarter of 2020.
At the end of the second quarter of 2021, we had $141 million of borrowing capacity available on our revolving credit facility which matures in December of 2023.
As a result, we are updating our revenue range for the year to an increase over 2020 of approximately 23% to 25% and or $783 million to $793 million, up from our previous estimated range of $710 million to $730 million.
The majority of this increase is organic with approximately 1/3 of the revenue range increase related to the addition of Clouth.
For the third quarter, we anticipate revenue between $195 million to $200 million and for the fourth quarter revenue of $220 million to $225 million.
We now anticipate gross margins for the year will come in at approximately 42.5%, down from our prior estimate of 43%, principally, as a result of including the amortization of the acquired profit and inventory related to our Clouth acquisition.
As a result, we anticipate gross margins will be 42% in the second half of the year, which includes the impact of amortization of the acquired profit and inventory.
Our current estimate for the inventory write-up is approximately $3.5 million with $1.4 million or $0.09 turning in the third quarter and the remaining $2.1 million or $0.12 turning in the fourth quarter.
We anticipate SG&A expenses will be a little over $54 million per quarter in the third and fourth quarter.
We now anticipate that SG&A expenses as a percentage of revenue will be lower than we projected at the beginning of the year and will be approximately 26% of revenue for the full year 2021.
This includes backlog amortization expense of approximately $400,000 or $0.03 in the third quarter.
Our interest expense will be approximately $1.3 million per quarter in the second half of 2021 due to the incremental borrowings related to our recent acquisition.
We anticipate the tax rate for the year will be approximately 28% and the third and fourth quarter of '21, approximately 28.5% to 29%.
We anticipate that our adjusted earnings per share will be lower in the third quarter compared to the second quarter of 2021 due to several factors, including a lower anticipated gross margin percentage versus the second quarter and the lack of payments received from government programs that contributed $0.10 to the second quarter results.
We have recast our first quarter 2021 non-GAAP financial metrics to reflect that our SG&A expense included $1.3 million of acquisition costs related to our acquisition of Clouth, which was announced in June.
We reported diluted earnings per share of $1.43 in the first quarter of 2021.
With these acquisition costs added back, our adjusted diluted earnings per share was $1.53 in the first quarter of 2021.
Also, we reported adjusted EBITDA of $31.1 million or 18% of revenue in the first quarter of 2021.
With the addition of these acquisition costs, our adjusted EBITDA was $32.4 million or 18.8% of revenue.

Summary:
Q2 revenue was up 28% compared to the second quarter of 2020 and up 14% sequentially and to a record $196 million.
Our GAAP diluted earnings per share was a record $1.96 in the second quarter, up 96% compared to $1 in the second quarter of 2020.
In the second quarter of 2021, our GAAP diluted earnings per share was $1.96, and after adding back acquisition costs of $0.05 our adjusted diluted earnings per share was $2.01.
As a result, we are updating our revenue range for the year to an increase over 2020 of approximately 23% to 25% and or $783 million to $793 million, up from our previous estimated range of $710 million to $730 million.