Kenneth J. Giacobbe
Executive Vice President Chief Financial Officer at Howmet Aerospace
Thank you, John. Please move to slide five for an overview of the markets. Second quarter revenue was up 17% year-over-year. The commercial aerospace recovery continued in the second quarter, with commercial aerospace revenue up 34% year-over-year and 7% sequentially, driven by the Engine Products segments and the narrow-body recovery. Commercial aerospace was up 45 -- commercial aerospace was 45% of total revenue, and although an improvement from 2021, we continue to be far short of the pre-COVID level, which was 60% of total revenue. Defense aerospace was essentially flat year-over-year as well as sequentially, driven by continued customer inventory corrections for the F-35.
Commercial transportation, which impacts both Forged Wheels and Fastening Systems segment, was up 19% year-over-year and 11% sequentially, driven by higher aluminum prices and higher volumes. Finally, the industrial and other markets, which is composed of IGT, oil and gas and general industrial, was down 4% year-over-year. Going deeper into this market, IGT was essentially flat, oil and gas was up 24% and general industrial was down 20% on a year-over-year basis. Now let's move to slide six. So let's start with the P&L with a focus on enhanced profitability. In the second quarter, revenue and adjusted EBITDA were at the high end of guidance as both metrics were up 17% year-over-year.
Adjusted EBITDA was $317 million. Adjusted EBITDA margin was also at the high end of guidance as it increased 10 basis points sequentially to 22.8%. Excluding the $60 million year-over-year revenue impact of higher material pass-through, EBITDA margin was 100 basis points higher at 23.8%. Adjusting for material pass-through, the flow of the incremental revenue to EBITDA was in line with expectations at approximately 33%. We've been able to maintain our strong margins despite the impact of higher material pass-through and inflation as well as headcount additions to support future growth. During the second quarter, we continued the recruitment of headcount by approximately 740 employees, including net additions of approximately 455 in engines and 245 in fasteners as preparations are made for continued growth in the second half, adding to the growth already experienced in Q2.
Year-to-date, we've increased headcount by more than 1,200 employees, and that's been focused in engines and in fasteners. Adjusted earnings per share exceeded the high end of the guidance at $0.35 per share, up 59% year-over-year. For the quarter, the impact of foreign currency on earnings was minimal. Moving to the balance sheet. Free cash flow in the second quarter was a positive $114 million, which excluded $44 million of proceeds generated from the sale and associated leaseback of our corporate headquarters in Pittsburgh. Cash on hand increased to $538 million after buying back $60 million of common stock, repurchasing $60 million of our 2024 bonds and funding the quarterly dividend.
The average diluted share count improved to a Q2 exit rate of 421 million shares. Net pension and OPEB liabilities were reduced by approximately $60 million in the first half of 2022, and cash contributions were reduced by approximately 65% to $13 million on a year-over-year basis. Discount rates continue to be favorable, and we will remeasure at the end of the year, which should further reduce the net pension liabilities. Annual cash contributions are estimated to be approximately $60 million versus expense of $20 million. Finally, net debt to EBITDA improved to three times. As John mentioned earlier, we expect net debt to EBITDA to accelerate by year-end and move towards two and a half times. Moving to capital allocation.
We continue to be balanced in our approach. Capital expenditures continued to be less than depreciation at approximately 67% in the second quarter. Productivity capex continues to be a focus on automation in both the Engines and the Fasteners business to improve yields, enhance quality, reduce outsourcing and mitigate labor risk. We purchased approximately 1.8 million shares of common stock in the quarter for $60 million. In the first half of 2022, we repurchased approximately 6.9 million shares of common stock for $235 million. I would also note that we purchased 0.9 million shares of common stock in July, which increases the July year-to-date repurchases to $265 million for 7.8 million shares with an average acquisition price of $33.76 per share.
Board authorization for share repurchases is currently $1,082,000,000. Moving to debt. We repurchased $60 million of our 2024 bonds in the quarter with cash on hand, and this will reduce our annualized interest cost by approximately $3 million. Lastly, we continue to be confident in free cash flow and paid the quarterly dividend of $0.02 per share of common stock. Now let's move to slide seven to cover the segments. Q2 was another solid quarter for the Engine Products segment. Year-over-year revenue was 20% higher in the second quarter, with commercial aerospace up 39%, driven by the narrow body recovery. Both IGT and defense aerospace were essentially flat year-over-year while oil and gas was up 24%.
Adjusted EBITDA increased 38% year-over-year and margin improved 360 basis points to a record 27.5%, despite adding approximately 455 employees in the second quarter. Year-to-date, net headcount additions for Engines was approximately 780 employees. Please move to slide eight. Fastening Systems year-over-year revenue was 6% higher in the second quarter. Commercial aerospace was 20% higher, driven by the narrow body recovery but somewhat offset by continued production declines for the Boeing 787. Industrial was down 26%, driven by a strong Q2 last year. We expect growth in industrial in the second half. Segment adjusted EBITDA decreased 11% in the quarter and was impacted by inflationary cost and the addition of approximately 245 employees to support future growth.
Year-to-date, headcount additions for fasteners was approximately 380 employees. Now let's move to slide nine. Engineered Structures' year-over-year revenue was 16% higher in the second quarter. Commercial aerospace was 37% higher as the narrow body recovery more than offset the impact of production declines for the Boeing 787. Segment adjusted EBITDA increased 8% year-over-year despite the inventory burn-down of the F-35 and continued 0 to low builds on the Boeing 787 and inflationary cost pressures. The Structures team delivered a Q2 EBITDA margin of 14.1%. I would note that the Q2 adjusted EBITDA margin was equal to the 2019 annual margin despite revenue being down approximately 40% using this quarter's annualized revenue.
This was solid performance by the Structures team. Finally, let's move to slide 10. As expected, Forged Wheels' year-over-year revenue was 22% higher in the second quarter. The $50 million increase in revenue year-over-year was driven by higher aluminum prices of $36 million and volume increases of $14 million or 7%. Commercial transportation demand remains strong but volumes continue to be impacted by customer supply chain issues, limiting commercial truck production. Segment adjusted EBITDA increased 7% despite the impact of unfavorable foreign currency, driven primarily by the Europe. While the pass-through of higher aluminum prices did not impact adjusted EBITDA dollars, it did unfavorably impact EBITDA margins by approximately 400 basis points.
Before I turn it back to John to discuss guidance, you will note that we called out unfavorable foreign currency in the Wheels segment as a good portion of that segment's revenue has production cost and revenue in local currency. For Howmet in total, the aerospace segments provide a natural foreign currency hedge, while the aerospace segments also have a production -- a portion of their production costs in local currency, the majority of the revenue is in U.S. dollars. For the quarter, Howmet's overall foreign currency earnings impact was less than $1 million. Now let me turn it back over to John.