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We delivered strong bottom-line results for the year, increasing adjusted earnings per share at 9% from $0.78 to $0.85.
To review, we're currently in Horizon-1, which consist of three elements: self-help, organic growth, and bolt-on M&A.
Once the foundational drivers of Horizon-1 are in place, we will move to Horizon-2, where we will execute larger enterprise level acquisition.
Our long-term vision culminates with Horizon-3, which is focused on growing the company globally.
Just last year, in 2020, eCommerce sales grew more than 30% from our 2019 base.
Sales in the eCommerce channel for 2020 approached 5% of our total revenue.
We are excited about this change in approach, and believe it moves us forward in Horizon-1, enabling growth while also managing costs.
Paul brings 30 years of leadership in the automotive and auto aftermarket industry, which includes the recent role as the President of International Brake Industries, and prior leadership positions with Federal-Mogul and General Motors.
In spite of several manufacturing plants being impacted by the COVID surge in mid-November and December, we're still able to finish the quarter with sales up 8% on an organic basis and 18%, including contributions from Elkhart acquisition.
In response, we announced an 8% price increase across the broad portfolio of our products, primarily in the Material Handling segment, which was effective March 1, 2021.
We are rapidly driving significant change in our organization, in our capabilities to ensure that we execute our Horizon-1 of our long-term strategy and create and deliver long-term shareholder value.
Net sales were up $21 million, an increase of 18%.
On an organic basis, net sales increased 8%, excluding the impact of the Elkhart acquisition.
Adjusted gross profit was up $1.2 million while gross margin decreased from 33.6% in the prior year to 29.4% in the quarter.
As a reminder, we are targeting $4 million to $6 million in annual cost synergies over the course of the upcoming two years.
Adjusted operating income decreased $700,000.
Adjusted EBITDA was $11.3 million, a decline of $1.6 million compared to the prior year.
Adjusted EBITDA margin was 8.2%.
Lastly, adjusted earnings per share was $0.11 versus $0.12 in the prior year.
Beginning with Material Handling, net sales increased 26% or 10% on an organic basis.
Material Handling adjusted operating income was essentially flat at $9.1 million, as the impact of higher sales was offset by unfavorable price-to-cost relationship, repairs and maintenance, employee benefit cost, and an unfavorable product mix.
In the Distribution segment, sales increased 4%, driven by increased sales of equipment and consumables, partially offset by lower sales of tire repair products and advance traffic marking tapes.
Distribution's adjusted operating income increased 13% to $3.6 million, primarily as a result of higher sales.
Fourth quarter free cash flow was $10.7 million, an increase of $7.8 million, reflecting an increase in cash provided by operating activities, including the benefit of working capital, net of deferred taxes.
During the quarter the company utilized approximately $63 million in cash to fund the Elkhart acquisition.
Cash on hand at year-end was $28 million.
Based on our trailing 12 month adjusted EBITDA of $66.4 million, leverage was 1.2 times.
Net sales are expected to increase by mid to high 20%, including an incremental 10.5 month of sales related to the Elkhart acquisition and the expected impact of the March 1st price increase.
As a reminder, Elkhart's annual net sales at the time of acquisition were approximately $100 million.
As Mike mentioned, the company announced an 8% price increase, primarily across the Material Handling segment, effective March 1st.
SG&A expenses are expected to approximate 24% of net sales, benefiting from larger scale.
The low operating income, we are projecting approximately $4 million of interest expense and an effective tax rate of 26%.
Our guidance reflects the weighted average share count of 36.5 million shares.
Taking all of these assumptions into account, we expect adjusted earnings per share to be in the range of $0.90 to $1.05 per share.
Other key assumptions impacting EBITDA and cash flow include depreciation and amortization expenses of approximately $23 million in capex of approximately $15 million.

Summary:
Lastly, adjusted earnings per share was $0.11 versus $0.12 in the prior year.
Net sales are expected to increase by mid to high 20%, including an incremental 10.5 month of sales related to the Elkhart acquisition and the expected impact of the March 1st price increase.
Taking all of these assumptions into account, we expect adjusted earnings per share to be in the range of $0.90 to $1.05 per share.
Other key assumptions impacting EBITDA and cash flow include depreciation and amortization expenses of approximately $23 million in capex of approximately $15 million.