While we continue to successfully implement price increases with the latest round becoming effective October 1, we have still been lagging in many cases, pressuring margins and resulting in us delivering adjusted earnings per share of $0.82 for the third quarter.
In AMS, overall sales nearly doubled, including the benefit of Scapa acquisition, with underlying organic sales increasing a strong 10% in the quarter.
Transportation was up approximately 25%.
Though still constrained, access to more raw materials should support our ability to deliver even greater than 10% growth next year on top of what will be already rapid growth in 2021.
Filtration also grew approximately 25% in the quarter as the need for cleaner and purer continues to drive positive trends.
On the air filtration side, sales nearly matched third quarter of last year when our sales grew more than 60% on widespread COVID-driven HVAC system upgrades.
We estimate the total impact to be in the range of $4 million to $5 million per quarter in lost sales, implying our total filtration business could have been up nearly 40% in the third quarter compared to last year.
Quarterly top and bottom line results were softer than last year, though this was to be expected as last year's third quarter was the highest quarterly segment of operating profits we have achieved over the past 5 years.
Unfortunately, while the decline in sales of 12% on a 10% volume decrease was generally anticipated, EP was not an exception to the inflationary pressures seen across global manufacturing.
This customer alone could become a multimillion-dollar customers within 2 years.
Starting with AMS, third quarter sales increased 87% with organic growth at 10%.
Directionally, it is possible AMS organic sales could have been up 20% without some of the constraints that we are dealing with.
We had excellent sales performance, particularly in transportation and filtration, each growing about 25% despite those limitations.
Adjusted operating profit increased 9%, reflecting the high organic sales growth and the incremental profits from Scapa.
Segment adjusted operating margin contracted 750 basis points to 10.5%, in large part due to higher input costs.
Higher resin costs, mostly for polypropylene, had a negative effect on operating profits of approximately $5 million, net of the price increases that were effective in the period.
For context on the recent price escalation, during the second quarter, polypropylene prices increased to about $1.20 per pound, up 150% year-over-year.
Due to the 1 quarter lag from when we purchase, produce and sell, we felt that impact during our third quarter.
In the third quarter, prices continued to rise sharply to an average price of approximately $1.40 per pound, which will flow through the P&L during the fourth quarter.
Current projections call for pricing to reach under $1 by the second half of 2022.
Regarding Scapa's profit contribution, the acquisition boosted AMS segment adjusted operating profits by over $9 million, similar to the second quarter.
However, as noted in our release, approximately $2.5 million of Scapa's SG&A costs were booked in our unallocated costs, not within AMS. So please be cognizant of that when assessing our segment financial results.
For Engineered Papers, second quarter sales were down 12% on a 10% volume decline.
Pulp costs alone were approximately a $3 million negative impact compared to last year, net of the price increases effective during the quarter.
For context, the NBSK wood pulp index was up 40% to nearly $1,200 per ton in the second quarter compared to last year, which flowed through the P&L in the third quarter, and the third quarter index was up 60% to nearly $1,340 per ton, which will impact fourth quarter results.
Regarding adjusted unallocated expenses, we saw an increase of $4 million during the quarter.
However, as noted, $2.5 million of the increase was Scapa's unallocated costs booked in our unallocated costs.
On a consolidated basis, sales for the quarter increased 37% to $384 million but decreased 1% on an organic basis.
Adjusted operating profit decreased 24% to $40 million.
Third quarter 2021 GAAP earnings per share was $0.38 versus $0.78.
The most material GAAP earnings per share items that are excluded from adjusted earnings per share were higher purchase accounting expenses of $0.29 per share compared to $0.15 last year due to the Scapa acquisition.
In addition, integration expenses were $0.08 per share.
Normalizing for those and other items, adjusted earnings per share was $0.82, down from last year's $1.16 per share.
To put some of the supply chain and cost headwinds into perspective, we estimate that cost inflation on resins and pulp alone that we did not recoup through price increases had an impact of over $0.20 per share on earnings per share in the quarter.
And the lost sales on transportation films alone was more than a $0.10 impact.
With respect to the fourth quarter, we expect adjusted earnings per share to be down approximately 20% from $0.77 in the prior-year quarter, implying full year adjusted earnings per share could finish about 10% below the low end of our original guided range.
This could mean potentially exiting 2022 on a run rate approaching $4 of adjusted EPS, assuming the current tax rate, which is generally consistent with our original 2021 guidance we issued before many of these challenges escalated.
Regarding cash flows, year-to-date operating cash flow was approximately $28 million, down from $108 million in the prior year.
Year-to-date adjusted operating profits were lower by $6 million.
We incurred $14 million of cash costs related fees and expenses in connection with the Scapa acquisition.
And we saw a $50 million increase in working capital outflows.
This inventory factor alone accounts for approximately $30 million of higher cash outflows compared to last year.
Net debt finished the second quarter just over $1.2 billion.
Net debt to adjusted EBITDA for the terms of our credit agreement was 4.8x at the end of the third quarter.
Despite leverage increasing, we remain comfortably below our 5.5 covenant level and have approximately $160 million in liquidity, consisting of our current cash balance of $73 million and $86 million of availability on our revolving credit facility.
As we close out 2021, we want to keep the ups and downs of the past 18 months in perspective.
And while we are grappling with supply chain headwinds this year, though very different issues, these 2 will ultimately normalize.
We are confident we can return to a run rate of $4 in earnings per share later in 2022 with the stage set for sustained growth in the years to follow.
These imperatives include innovation of new products, offering expanded solutions, realizing the synergies of our recent acquisitions and leveraging manufacturing 4.0 technology to improve operations.

Summary:
While we continue to successfully implement price increases with the latest round becoming effective October 1, we have still been lagging in many cases, pressuring margins and resulting in us delivering adjusted earnings per share of $0.82 for the third quarter.
On a consolidated basis, sales for the quarter increased 37% to $384 million but decreased 1% on an organic basis.
Third quarter 2021 GAAP earnings per share was $0.38 versus $0.78.
Normalizing for those and other items, adjusted earnings per share was $0.82, down from last year's $1.16 per share.