Derrick A. Jensen
Chief Financial Officer at Quanta Services
Thanks, Duke, and good morning, everyone. Today, we announced record third quarter 2021 revenues to $3.4 billion. Net income attributable to common stock was $174 million or $1.21 per diluted share. And adjusted diluted earnings per share, a non-GAAP measure, was $1.48. Our electric power revenues were $2.3 billion, a quarterly record and a 10% increase when compared to the third quarter of 2020. This increase was driven by continued favorable dynamics across our core utility and communications market and associated demand for our services. Also contributing to the increase were revenues from acquired businesses of approximately $55 million. Electric segment operating income margins in 3Q '21 were 12.4%, slightly lower than 12.7% in 3Q '20 but better than our initial expectations. Operating margins benefited from record emergency restoration revenues of approximately $230 million, which typically present opportunities for higher margins than our normal base business activities due to higher utilization as well as overall solid execution across our electric operations.
Additionally, segment margins benefited from approximately $10 million of income associated with our LUMA joint venture. Otherwise, the slight reduction in operating margin versus prior year was attributable to normal job variability and mix of work and our communications operations, which delivered mid-single-digit margins during the quarter. As a reminder, last year's third quarter electric power results also included what was at the time a record level of emergency restoration revenues. Underground Utility and Infrastructure segment revenues were $1.02 billion for the quarter, 12% higher than 3Q '20 due primarily to increased revenue from gas distribution and industrial services. Though our operations experienced increased activity year-over-year, current quarter revenues and margins in our industrial operations were negatively impacted by disruptions along the Gulf Coast attributable to Hurricane Ida in both our industrial and non-U.S. markets within this segment remain pressured by COVID-19 dynamics. Third quarter operating income margins for the segment were 6.7%, 170 basis points lower than 3Q '20, but generally in line with our expectations. Margins for the year -- margins for the third quarter of 2020 benefited from favorable adjustments on certain larger pipeline projects with both scope changes and favorable closeout in the quarter.
Our total backlog was $17 billion at the end of the third quarter, the fifth consecutive quarter we've posted record total backlog. Additionally, 12-month backlog of $9.8 billion also represents a quarterly record. Our backlog growth continues to be driven primarily by multiyear MSA programs with North American utilities, which we believe reinforces the repeatable and sustainable nature of the largest portion of our revenues and earnings. The Blattner acquisition occurred after September 30. And accordingly, their backlog is not included in our current reported levels. However, the total backlog from Blattner and the other 4Q acquisitions is approximately $1.8 billion. For the third quarter of 2021, we generated negative free cash flow, a non-GAAP measure, of $40 million compared to $70 million of positive free cash flow in 3Q '20. Net cash provided by operating activities during the third quarter of 2021, although largely in line with our expectations, was down due to higher revenues and corresponding increases in working capital demands compared to prior year, which benefited from lower revenues and a corresponding lower use of working capital.
Also, 3Q '20 benefited from the deferral of $41 million of payroll taxes in accordance with the CARES Act, 50% of which are due by December 31, 2021, with the remainder due by December 31, 2022. Partially offsetting these dynamics was a favorable impact of increased earnings as compared to 3Q '20. Days sales outstanding, or DSO, measured 89 days for the third quarter of 2021, an increase of seven days compared to the third quarter of 2020 and an increase of six days compared to December 31, 2020. The increase was primarily due to elevated working capital requirements associated with two large Canadian transmission projects driving an increase in contract assets. Specific to the Canadian projects, both continue to encounter work stoppage protocols in Canada associated with COVID mitigation as well as delays attributable to, among other things, wildfires impacting access to work sites. These dynamics created substantial inefficiencies and production delays resulting in increased project costs.
We are in active discussions with both customers regarding change orders associated with these increased costs, some of which have already been approved with the remaining amounts being pursued in the normal course. In addition, normal variability in work production and associated payment cycles across our operations contributed to slightly higher DSO in the quarter. As Duke discussed and as we previously announced, we closed on the acquisition of Blattner on October 13. Prior to the closing, in September 2021, we issued $1.5 billion aggregate principal amount of senior notes with a weighted average interest rate of 2.12%, receiving net proceeds of $1.48 billion. Accordingly, as at quarter end, we had approximately $1.7 billion of cash. Subsequent to the quarter, we amended our credit agreement to, among other things, provide a term loan facility of $750 million, which was fully drawn and combined with the net proceeds from the senior notes offering to fund a substantial majority of the cash consideration payable to the Blattner shareholders at closing. I'll highlight that our financial strategy and consistent performance have allowed us to maintain investment-grade ratings subsequent to these financing transactions.
From a capital allocation perspective, Blattner represents the largest acquisition in Quanta's history and a strategic opportunity to expand the solutions we deliver to support North America's transition to carbon neutral energy infrastructure. Capital deployment for strategic acquisitions has always been a key part of our strategy. But as we've discussed in the past, our first priority for capital allocation remains supporting the working capital and equipment needs of our existing operations. While the debt issued to support the Blattner acquisition moved our leverage profile above our target range, it remains well below the financial covenant requirements in our credit facility, and we believe we can efficiently delever while continuing to create shareholder value through our dividend and repurchase programs as well as strategic acquisitions. Through the date of this earnings release, we've acquired approximately $64 million worth of stock since the beginning of the year as part of our repurchase program, and we'll continue to evaluate potential acquisitions that fit our strategic objectives.
To that end, during the third quarter and through the date of the earnings release, in addition to Blattner, we acquired three additional businesses and made a minority investment in another for total combined consideration of approximately $110 million. These incremental transactions further enhance our ability to deliver comprehensive infrastructure solutions to our North American utility and communications customers. Turning to our guidance. Our outlook for the remainder of the year reflects the strength of our core utility-backed operation, which continued to deliver solid results with robust year-over-year growth. However, the results of companies acquired during and subsequent to the third quarter, including Blattner's operations, will be included in our consolidated financial statements, which makes comparability to our previous expectations' challenge. It should be noted that we are in very early stages of establishing Blattner-specific opening balance sheet, which includes assessing the positions of ongoing projects as of the closing and valuing the tangible and intangible assets acquired. The result of those ongoing efforts will have a meaningful impact on Blattner's fourth quarter contribution, which we've attempted to address in the range of our fourth quarter expectations for the acquired businesses.
That said, excluding the expected contributions from the recently acquired companies, we now expect full year revenues from our legacy operations to range between $12.15 billion and $12.35 billion. Due to the strength of our consolidated performance for the first nine months of the year, we are increasing our expectations for the contribution of our legacy operations to adjusted EBITDA to range between $1.17 billion and $1.2 billion, with the midpoint of the range representing an increase over our previous guidance and 13% growth when compared to 2020's record adjusted EBITDA. As it relates to our current reportable segments, while we continue to evaluate how these changes may change with the addition of Blattner, I wanted to provide some color on our current expectations compared to our previous commentary, again, excluding contributions from the recently acquired businesses. We continue to expect full year revenues to range between $8.7 billion and $8.8 billion for our legacy electric segment operations.
However, based on the strong performance through the first nine months of the year and continued confidence in our ability to execute on the opportunities across the segment, we've increased our full year margin range for the segment with 2021 operating margins expected to come in slightly above 11%. Our full year expectations for the Underground Utility and Infrastructure Solutions segment, however, have slightly moderated due primarily to lower third quarter revenue levels than previously expected. Accordingly, we are reducing our full year expectations for the segment with revenues now expected to range between $3.45 billion and $3.55 billion while segment margins are now expected to range between 4.5% and 5%, which includes a $23.6 million provision for credit loss recognized in the second quarter, a nearly 70-basis-point negative impact on a full year basis. With regard to the recently acquired companies operations I spoke of earlier, including Blattner, we expect post-closing revenue contributions for the year to range between $400 million and $500 million and adjusted EBITDA, a non-GAAP measure, ranging between $40 million and $60 million.
Accordingly, including the expected contributions from the recently acquired companies, we now expect our consolidated full year revenues to range between $12.55 billion and $12.85 billion and adjusted EBITDA, a non-GAAP measure, of between and $1.21 billion and $1.26 billion. Corporate and unallocated costs will increase significantly, primarily due to the acquired companies. We currently estimate amortization expense for the full year will be between $149 million and $159 million, with $60 million to $70 million attributable to the recently acquired companies. Stock compensation expense for the full year is now expected to be approximately $89 million, with approximately $2 million attributable to restricted stock units issued to employees of the acquired company. Acquisition and integration costs are expected to be approximately $26 million for the fourth quarter, resulting in approximately $36 million for the year. This includes approximately $10.5 million of expenses associated with change of control payments awarded to certain employees of Blattner by the selling shareholders, which require expense accounting as they have a one-year service period requirement. We expect a comparable dollar amount will be accrued each quarter post closing until the one-year anniversary of the transaction, at which time the payments will be made to the employee. We intend to include this amount as an adjustment to arrive at our adjusted EPS and adjusted EBITDA, both non-GAAP measures. Below the line, we expect interest expense for the year to be around $67 million, which includes approximately $16 million of incremental interest expense associated with debt financing used to fund the cash portion of the Blattner acquisition.
Additionally, we now expect our full year tax rate to be around 24%, reflecting a slight reduction from our prior expectations due primarily to a favorable shift in the mix of earnings between various taxing jurisdictions. As a result, our expectation for full year diluted earnings per share attributable to common stock is now between $3.20 and $3.40. And our increased expectation for adjusted diluted earnings per share attributable to common stock, a non-GAAP measure, is now between $4.62 and $4.87. On a consolidated basis, we now expect free cash flow for the year to range between $350 million and $500 million. This slight decrease is primarily due to potential timing of payments associated with emergency restoration efforts as well as the likelihood that the dynamics impacting the larger Canadian projects continue to pressure DSO in the fourth quarter.
Additionally, while we expect Blattner will be meaningfully accretive to our cash flow profile on an annual basis, we expect certain favorable billing positions at the time of acquisition could unwind as Blattner incurs costs in the fourth quarter to finish projects for which they've already received payments. This dynamic could minimize Blattner's cash contribution during the quarter, which we factored into our range of expectations. As we stated in prior quarters, our quarterly free cash flow is subject to sizable movements due to various customer and project dynamics that can occur in the normal course of operations. For additional information, please refer to our outlook summary, which can be found in the Financial Info section of our IR website at quantaservices.com. Overall, we continue to believe we are in the early stages of a significant infrastructure investment cycle, and the acquisition of Blattner further differentiates us in the markets we serve and expand our ability to deliver solutions to support North America's transition to carbon neutral energy infrastructure. We remain confident in our ability to execute against the opportunities in front of us while maintaining the financial flexibility to opportunistically deploy capital to deliver long-term shareholder value.
This concludes our formal presentation, and we'll now open the line for Questions and Answers. Operator?
