James L. Janik, President and Chief Executive Officer of Douglas Dynamics commented, "We are pleased with our third quarter performance. We delivered solid operational and financial results, continued to realize operational efficiencies and quality improvements and successfully completed our pre-season sales period. In our pre-season sales period, we achieved a year-over-year increase in equipment shipments, grew revenue, expanded margins and improved Adjusted EBITDA. As a result, our adjusted EBITDA year-to-date is 14.5% above that of last year. In addition, during the quarter we paid our initial quarterly cash dividend, reflecting the Company's growth and commitment to delivering shareholder value."
Net income was $2.2 million, or $0.10 per diluted share, in the third quarter of 2010 compared to net income of $2.7 million, or $0.19 per diluted share, in the third quarter of 2009. Net income in the third quarter of 2010 included $1.2 million in pretax non-recurring expenses associated with compensation expense. Adjusted net income (net income excluding these expenses), was $2.9 million, or $0.13 per diluted share.
The Company reported Adjusted EBITDA of $11.6 million in the third quarter of 2010, a 8.6% decrease compared to Adjusted EBITDA of $12.7 million in the third quarter of 2009. The decrease in Adjusted EBITDA is primarily attributable to the shift in pre-season shipments from the third quarter into the second quarter. Adjusted EBITDA for the total 2010 pre-season period was $33.2 million compared to Adjusted EBITDA of $28.5 million for the same period in 2009, an increase of $4.7 million, or 16.4%.
Balance Sheet and LiquidityDuring the third quarter of 2010, the Company recorded net cash used in operating activities of $13.7 million compared to net cash used in operating activities of $18.5 million in the same period last year. This decrease was driven by slower growth in accounts receivable versus the prior year.