Despite the sequential 36% decline in US onshore rig count, two hurricane storms that came through the Gulf of Mexico and the continued overhang from COVID-19, our team's focus on execution of our strategies resulted in positive EBITDA for each of our segments and sequential improved EBITDA margins.
On a consolidated basis, we achieved $30 million of adjusted EBITDA in the third quarter with the related margin improving 150 basis points sequentially as a result of our focus on cost management and maximizing the value of our latest technology.
Compared to the third quarter of last year, we've reduced our cost by $345 million on an annualized basis or 41% as it impacts EBITDA.
This compares to an annualized decline of revenue of $373 million, reducing cost by $0.92 for every $1 decline in revenue.
TETRA only generated $7.7 million of free cash flow from continuing operations in the quarter and ended the quarter with $59 million of cash at the TETRA level.
Year-to-date September, we've generated $43.5 million of TETRA-only cash from continued operations, an improvement of $66.6 million from last year.
And products third-quarter revenue decreased 27% sequentially, reflecting the seasonal second-quarter peak from our industrial European business and also due to project delays in the Gulf of Mexico as we experienced two major hurricanes in the third quarter.
Despite the lower revenue and sudden impact from the hurricanes, we achieved higher adjusted EBITDA margins by 110 basis points sequentially.
The third-quarter adjusted EBITDA margin of 26.8% was also 310 basis points better than a year ago.
International sales for completion fluids, excluding the industrial business, increased sequentially by 84%, led by some large sales for some major national oil companies in the Middle East.
Our industrial chemicals business continues to perform well and made up approximately 36% of the total revenue for this segment.
Water and flowback third-quarter adjusted EBITDA remained positive despite revenue decreasing sequentially 13%.
Integrated projects increased from 16 with 14 different customers at the end of the second quarter to 17 with 10 different customers at the end of the third quarter.
In September, 63% of our water management work was associated with integrated projects with multiple services provided by our BlueLinx automation system.
Our SandStorm technology was able to achieve 99.4% sand filtration.
We far exceeded the current solution the customer was using, with zero wash downstream and at a peak flow rate of 40 million standard cubic feet per day.
Excluding new equipment sales, which we have now exited, revenue decreased 1% sequentially to $72 million.
Third-quarter adjusted EBITDA of $22.9 million was down $3.4 million from the second quarter.
Adjusted EBITDA margins improved 170 basis points sequentially.
Compression services revenue decreased 5% sequentially, and gross margins decreased 200 basis points to 52.9%.
Utilization declined from 82.1% in the second quarter to 80.3% in the third quarter.
We believe that our strategy to invest in high horsepower equipment will allow us to maintain utilization above the low point of 75.2% that was seen during the last downturn.
In the third quarter, horsepower was on standby decreased from a peak of 20% back in May to approximately 8% at the end of September as our key customers started bringing production and units back online.
We've completed 25% of the hardware upgrade rollouts and expect to be fully deployed by the end of 2021.
Aftermarket services revenue declined 12% from the second quarter, while gross margins improved 200 basis points sequentially.
Brady mentioned that we generated $43.5 million of free cash flow year to date on a TETRA-only basis, which is an improvement of $67 million from the same time a year ago.
TETRA-only adjusted EBITDA was $7 million in the third quarter.
TETRA-only capital expenditures in the third quarter were $1.6 million.
Of the $43.5 million of free cash flow that we generated so far this year, $11.4 million is year-to-date earnings less capex, less interest expense and less taxes.
The other $32 million has been from monetizing working capital, and monetizing receivables in this environment is not easy given the financial struggles by many of our customers.
Our ability to generate $11 million in free cash flow this year without the benefit of working capital talks to the aggressive cost management we have implemented, the benefit of deploying technology to the US onshore market, and a very flexible, vertically integrated business model on the fluids side.
In the third quarter, we were slightly over $0.5 million positive free cash flow without the benefit of monetizing working capital.
For the full year of 2020, we expect TETRA-only capital expenditures to be between 9 and $12.5 million, slightly lower than the prior guidance.
TETRA-only liquidity ended the third quarter improved approximately $22 million in the same period a year ago, positioning us to be able to continue to manage through this downturn as activity begins to slowly recover.
TETRA-only net debt at the end of September was $148 million with cash on hand of $59 million.
Our $221 million term loan is not due until August 2025, and our $100 million asset-based revolver does not mature until September 2023.
Annual interest expense on this term loan is approximately 15.5 to $17 million.
CSI Compressco's cash on hand at the end of September was $16.7 million, up from $2.4 million at the beginning of the year.
At the end of September, there were no amounts outstanding on the revolver compared to $2.6 million that was outstanding at the beginning of the year.
The reduction in the outstanding amount of revolver plus the increasing cash represents almost a $17 million improvement from the beginning of the year despite very challenging market conditions.
And this is how CSI Compressco paid almost $5 million of legal and advisor fees to complete the debt swap in June of this year, which resulted in a net reduction of $9 million and pushed $215 million of maturities into 2025 and 2026.
CSI Compressco sold our Midland fabrication facility and related real estate and have targeted the sale of $13 million in compressor assets in the second half of this year.
Their objective is to generate between $15 million and $25 million of free cash flow by early in the third quarter of 2021 to partially pay down the maturing $81 million of unsecured notes and to refinance the remaining amount.
For the full-year 2020, CSI Compressco expects capital expenditures of between 6 and $7 million, and maintenance capital expenditures of between 20 and $21 million.
And this year, they expect to spend between 5 and $6 million.
Other than the $81 million of unsecured notes that are due August of 2022 for CSI Compressco, the $555 million of first and second lien bonds are not due until 2025 and 2026.
CSI Compressco's net leverage ratio at the end of September was 5.4 times.
CSI Compressco generated $14 million of free cash flow in the quarter.
And year-to-date, free cash flow is $24.7 million.
Distributable cash flow was $10.5 million in the third quarter, which increased by 25% as they benefited from the sale of used assets.
Through September, distributable cash flow was $27 million.
On an annualized basis, distributable cash flow will be $36.5 million or approximately $0.77 per common unit.
This compares to CSI Compressco's unit price at the close of business last week of $0.85, which is not a bad cash flow yield.
And other than $81 million of unsecured debt that is due August of 2022 for CSI Compressco, there are no near-term maturities.

Summary:
And products third-quarter revenue decreased 27% sequentially, reflecting the seasonal second-quarter peak from our industrial European business and also due to project delays in the Gulf of Mexico as we experienced two major hurricanes in the third quarter.
For the full-year 2020, CSI Compressco expects capital expenditures of between 6 and $7 million, and maintenance capital expenditures of between 20 and $21 million.