Thomas E. Stiehle
Executive Vice President and Chief Financial Officer at Huntington Ingalls Industries
Thanks, Chris, and good morning. Today, I will briefly review our third quarter results and provide an update on our outlook for 2021. For more detail on the segment results, please refer to the earnings release issued this morning and posted to our website. Beginning with our consolidated results on slide four of the presentation, our third quarter revenues of $2.3 billion increased approximately 1% compared to the same period last year. This is due to growth at Technical Solutions driven by the Alion acquisition which was largely offset by a decline in revenue at Ingalls, primarily due to lower volumes on the NSC, DDG and LHA programs.
Segment operating income for the quarter of $163 million increased $1 million compared to the third quarter of 2020. And segment operating margin of 7% was in line with the results from the prior year period. Operating income for the quarter of $118 million decreased by $104 million from the third quarter of 2020, and operating margin of 5% decreased 455 basis points. These decreases were almost entirely due to a less favorable operating FAS/CAS adjustment compared to the prior year period. The tax rate in the quarter was a negative 4.3% compared to 1.8% in the third quarter of 2020. The decrease in the tax rate was primarily due to additional research and development tax credits for tax years 2016 through 2020 recorded in the third quarter of 2021.
Net earnings in the quarter were $147 million compared to $222 million in the third quarter of 2020. Diluted earnings per share in the quarter were $3.65 compared to $5.45 in the prior year period. Third quarter 2021 results include approximately $15 million of nonrecurring pretax transaction expenses related to the acquisition of Alion. Excluding the impacts of pension, diluted earnings per share in the quarter were $3.58 compared to $3.73 per share in the third quarter of 2020. Turning to slide five. Cash from operations was $350 million in the quarter and net capital expenditures were $73 million or 3.1% of revenues, resulting in free cash flow of $277 million.
This compares to cash from operations of $222 million and $62 million of net capital expenditures or free cash flow of $160 million in the prior year period. Cash contributions to our pension and other postretirement benefit plans were $10 million in the quarter, principally related to postretirement benefits. During the third quarter, we paid dividends of $1.14 per share or $46 million. Our Board of Directors recently approved a 3.5% increase in our quarterly dividend to $1.18 per share, and this will take effect in the fourth quarter of this year. We also repurchased approximately 83,000 shares during the quarter at an aggregate cost of approximately $17 million.
Moving on to slide six. Ingalls revenues in the quarter of $628 million decreased $47 million or 7% from the same period last year, driven primarily by lower revenues on the NSE, DDG and LHA programs. Ingalls operating income of $62 million and margin of 9.9% in the quarter compared to operating income of $62 million and margin of 9.2% in the third quarter of 2020. The operating margin improvement was driven by an incentive on the DDG program and higher risk retirement for the LPD program, partially offset by lower risk retirement on the NSC program. Turning to slide seven. Newport News revenues of approximately $1.4 billion in the quarter decreased $4 million or less than 1% from the same period last year, driven by lower revenues in naval nuclear support services partially offset by higher revenues in submarines and aircraft carriers.
Naval nuclear support services revenues decreased primarily as a result of lower volumes in submarine fleet support services and facility maintenance services partially offset by higher volumes in carrier fleet support services. Submarine revenues increased due to higher volumes in Block V boats of the Virginia-class submarine program, and submarine support services and Columbia-class submarine program, partially offset by lower volumes on Block IV boats of the Virginia-class submarine program. Aircraft carrier revenues increased primarily as a result of higher volumes on the RCOH of USS John C. Stennis CVN 74 and the construction of Doris Miller CVN 81 and enterprise CVN 80, partially offset by lower volumes on the RCOH of USS George Washington CVN 73 and the construction of John F. Kennedy CVN 79.
Newport News operating income of $88 million and margin of 6.5% in the quarter compares to operating income of $79 million and margin of 5.8% in the third quarter of 2020. The improvement was primarily due to higher risk retirement on the RCOH of the USS George Washington CVN 73 and Block IV boats of the VCS program, partially offset by lower risk retirement on the naval nuclear support services. Now to Technical Solutions on slide eight of the presentation. Technical Solutions revenues of $394 million in the quarter increased 23% from the same period last year, mainly due to revenue attributable to the acquisition of Alion in mid-August, partially offset by the divestiture of our oil and gas business and contribution of the San Diego shipyard to a joint venture in the first quarter of this year.
The acquisition of Alion closed on August 19, and third quarter results included approximately $163 million of revenue attributable to Alion. Technical Solutions operating income of $13 million and operating margin of 3.3% in the quarter compares to an operating income of $21 million and operating margin of 6.6% in the third quarter of 2020. These decreases were primarily driven by the inclusion of approximately $8 million of Alion related purchase intangible amortization as well as lower performance in Defense and Federal Solutions, the divestiture of our oil and gas business and the contribution of the San Diego shipyard to a joint venture I previously mentioned.
Third quarter 2021 results include approximately $4 million of operating income attributable to Alion. Third quarter Technical Solutions EBITDA was approximately $30.3 million or an EBITDA margin of 7.7%. Moving on to slide nine of the presentation. We've updated our outlook for 2021 and 2022 pension and postretirement benefits. For 2022, FAS is now projected to be a benefit rather than an expense, primarily due to higher asset returns. Consequently, the FAS/CAS adjustment has increased from the prior outlook and is now projected to total $52 million in 2022. Please remember that pension-related numbers are subject to year-end performance and measurement criteria.
We will provide a multiyear update of pension estimates on our fourth quarter earnings call in February. Finally, on slide 10, a perspective on the outlook for the remainder of the year for both shipbuilding and Technical Solutions inclusive of Alion. Regarding shipbuilding, we now expect 2021 revenue to be approximately $8.2 billion at the low end, but within our initial guidance range. Third quarter shipbuilding revenue was modestly impacted by material timing, which may persist in the near term. Additionally, we continue to navigate through a challenging labor market as well as the potential impact of COVID-19 vaccine mandate. Given all of that, we think it's best to be prudent and temper near-term expectations.
We continue to expect that shipbuilding operating margin will finish the year in the 7.5% to 8% range. We expect that the fourth quarter shipbuilding operating margin will be roughly consistent with the third quarter results as we were able to recognize some key retirement events in the third quarter, including the completion of sea trials for DDG 121. Regarding Technical Solutions, I've noted that Alion acquisition closed in mid-August and our updated expectations for 2021 now include Alion from the date of acquisition, inclusive of incremental purchase intangible amortization that impacts our segment operating margin expectation.
Turning to free cash flow. We now expect 2021 free cash flow to be between $300 million and $350 million as the repayment of the accelerated progress payments which was initially expected in 2021 has now moved out to 2022. Additionally, on slide 10, we have provided an updated outlook for a number of other discrete items to assist with your modeling. Regarding our longer-term targets, we continue to believe that the 3% CAGR for shipbuilding revenue is appropriate. Additionally, we remain comfortable with our free cash flow target of $3.2 billion from 2020 through 2024. We plan to provide a more detailed view of 2022 on our fourth quarter call in February.
Now I'll turn the call back over to Dwayne for Q&A.