Excluding a special item with a net after-tax benefit of $32 million, we earned $450 million or $0.60 per diluted share.
Year-to-date, we've generated more than $3.4 billion of adjusted EBITDA and $2.4 billion of adjusted funds available for distribution.
Timberlands earnings increased by $20 million in the quarter, which included a $32 million gain on the previously announced sale of our North Cascades Timberlands.
Adjusted EBITDA decreased by $15 million compared to the second quarter.
In the West, adjusted EBITDA decreased by $13 million compared to the second quarter.
To date, we've completed approximately 80% of our planned salvage harvest and expect to conclude most of this work by year-end.
Turning to Real Estate, Energy and Natural Resources on pages 10 and 11.
Real estate and ENR contributed $45 million to third quarter earnings and $60 million to adjusted EBITDA.
Third quarter adjusted EBITDA was $31 million lower than the second quarter due to timing of transactions, but comparable to the year ago quarter.
Moving to Wood Products, pages 12 through 14.
Wood Products earnings and adjusted EBITDA decreased by approximately 60% compared to the prior quarter as lumber and OSB pricing declined substantially from record levels earlier in the year before stabilizing later in the quarter.
Our EWP business established a new quarterly EBITDA record in the third quarter and the overall Wood Products segment has achieved year-to-date adjusted EBITDA of more than $2.8 billion.
Adjusted EBITDA for our lumber business decreased $686 million compared to the second quarter.
Our sales realizations decreased by 52% in the third quarter while the framing lumber composite pricing decreased by 61%.
Adjusted EBITDA for our OSB business decreased by $128 million compared to the second quarter.
Our sales realizations decreased by 24% in the third quarter while the OSB composite pricing decreased by 43%.
Engineered Wood Products adjusted EBITDA increased $23 million compared to the second quarter, a 43% improvement.
In Distribution, adjusted EBITDA decreased by $53 million compared to the second quarter.
Despite lower sales volumes for most products and significantly lower margins resulting from the commodity price correction, our teams did a great job navigating these challenges and delivered $22 million of adjusted EBITDA in the third quarter.
I'll begin with our key financial items, which are summarized on page 16.
We generated $659 million of cash from operations in the third quarter, bringing our year-to-date total to nearly $2.7 billion, our highest year-to-date operating cash flows on record.
Adjusted funds available for distribution or adjusted FAD, for year-to-date, third quarter 2021 totaled over $2.4 billion, as highlighted on page 17.
Year-to-date, we have returned $382 million to our shareholders through the payment of our quarterly base dividend, and we will supplement the base dividend each year with an additional return of cash to achieve the targeted 75% to 80% of adjusted FAD.
However, as a result of the record year-to-date performance, we accelerated a portion of the supplemental dividend by returning $375 million to our shareholders through our previously announced $0.50 per share interim supplemental dividend earlier this month.
During the third quarter, we also returned $26 million to shareholders through share repurchases.
Further, as previously announced, we authorized a new $1 billion share repurchase program.
We ended the quarter with approximately $2.3 billion of cash and just under $5.3 billion of debt.
Subsequent to quarter end, we repaid our $150 million or 9% note at maturity, which brings our debt balance to $5.1 billion.
Looking forward, key outlook items for the fourth quarter are presented on page 18.
In our Timberlands business, we expect fourth quarter earnings and adjusted EBITDA will be comparable to the third quarter.
Fourth quarter earnings and adjusted EBITDA will be significantly lower than third quarter due to timing of transactions.
We continue to predict full year 2021 adjusted EBITDA will be approximately $290 million, and we now expect basis as a percentage of real estate sales to be approximately 25% to 30% for the full year.
Excluding the effect of changes in average sales realizations for lumber and oriented strand board, we expect fourth quarter earnings and adjusted EBITDA will be higher than the third quarter.
As shown on page 19, our current and quarter-to-date realizations for lumber are slightly higher than the third quarter average.
As shown on page 19, our current and quarter-to-date realizations for oriented strand board are significantly lower than the third quarter average, but still elevated compared to historical standards.
We now anticipate our full year outlook for capital expenditures to be slightly below our previous guidance of $460 million as a result of supply chain and contract labor constraints with $15 million to $25 million potentially at risk.
The $90 million tax refund associated with our 2018 pension contribution was approved during the second quarter.
Notwithstanding a slight decrease from the prior quarter, U.S. housing activity remained strong in the third quarter, with total housing starts and permits averaging around 1.6 million units on a seasonally adjusted basis.

Summary:
Excluding a special item with a net after-tax benefit of $32 million, we earned $450 million or $0.60 per diluted share.
We ended the quarter with approximately $2.3 billion of cash and just under $5.3 billion of debt.
In our Timberlands business, we expect fourth quarter earnings and adjusted EBITDA will be comparable to the third quarter.
Fourth quarter earnings and adjusted EBITDA will be significantly lower than third quarter due to timing of transactions.
Excluding the effect of changes in average sales realizations for lumber and oriented strand board, we expect fourth quarter earnings and adjusted EBITDA will be higher than the third quarter.