For the third quarter, we reported combined adjusted EBITDA of approximately $290 million, of which $230 million was directly from our Global Ingredients business.
With the days of shutdown and the restart process, we lost approximately 17 days of renewable diesel production.
Also, on the great news front, the DGD Norco expansion is running well and is closing in on reaching its production capacity, putting DGD on track to sell 365 gallons or more in 2021.
We also believe DGD could sell over 700 million gallons of renewable diesel in 2022 as the engineering team continues to fine tune the performance of this expansion.
Also, during the quarter, Darling repurchased approximately $22 million of common stock.
And for year-to-date, we have purchased approximately $98 million worth of stock.
On a year-to-date basis, our Global Ingredients business has earned approximately $628 million of EBITDA, putting us at an annualized run rate of approximately $850 million for 2021.
Net income for the third quarter of 2021 totaled $146.8 million or $0.88 per diluted share compared to net income of $101.1 million or $0.61 per diluted share for the 2020 third quarter.
Net sales increased 39.4% to $1.2 billion for the third quarter of 2021 as compared to $850.6 million for the third quarter of 2020.
Operating income increased 61.4% to $205.7 million for the third quarter of 2021 compared to $127.5 million for the third quarter of 2020.
The increase in operating income was primarily due to the $114.1 million increase in gross margin which was a 53.8% increase in gross margin over the same quarter in 2020.
Our operating income improvement was impacted by the lower contribution of our 50% share of Diamond Green Diesel's net income, which was $54 million in the third quarter of 2021 as compared to $91.1 million for the same quarter of 2020.
Q3 2021 gross margin was 27.5%, which is the best result we have had in the last 10 years.
For the first nine months of this year, our gross margin percentage was 26.8% compared to 24.9% for the same period a year ago or a 7.6% improvement year-over-year.
Depreciation and amortization declined $7.9 million in the third quarter of 2021 when compared to the third quarter of 2020.
SG&A increased $7.3 million in the quarter as compared to the prior year and declined $1.9 million from the previous quarter.
Interest expense declined $3.4 million for the third quarter 2021 as compared to the 2020 third quarter.
Now turning to income taxes, the company recorded income tax expense of $42.6 million for the three months ended October 2, 2021.
Our effective tax rate is 22.3%, which differs from the federal statutory rate of 21%, due primarily to biofuel tax incentives, the relative mix of earnings among jurisdictions with different tax rates and certain taxable income inclusion items in the U.S. based on foreign earnings.
For the nine months ended October 2, 2021, the company recorded income tax expense of $126.3 million and an effective tax rate of 20.2%.
The company also has paid $36.9 million of income taxes year-to-date as of the end of the third quarter.
For 2021, we are projecting an effective tax rate of 22% and cash taxes of approximately $10 million for the remainder of the year.
Our balance sheet remains strong with our total debt outstanding as of October two at $1.38 billion and the bank covenant leverage ratio ended the third quarter at 1.6 times.
Capital expenditures were $65.6 million for Q3 2021 and totaled $191.7 million for the first nine months of 2021.

Summary:
Net sales increased 39.4% to $1.2 billion for the third quarter of 2021 as compared to $850.6 million for the third quarter of 2020.