This is reflected in our recently updated 2021 guidance, which, despite the near-term challenges, projects full-year organic growth of 18% to 23%, above our long-term 15% historical baseline growth, in addition to M&A growth of 19% to 20%.
On October 25, 2021, the Company also entered into a new $125.0 million senior secured term loan facility plus 4.50%, and matures on October 25, 2028.
and related entities , an Illinois-based manufacturer of horticulture benches, racking and LED lighting systems. IGE also has a commercial equipment product range that will complement Hydrofarm’s existing lineup of high performance, proprietary branded products.
Net sales in the third quarter of 2021 increased $27.2 million or 28.1% to $123.8 million compared to the third quarter of 2020, driven by an approximate 24.4% increase in volume of products sold , an approximate 2.8% increase in price/mix of products sold, and an approximate 0.8% growth from favorable foreign exchange rates.
Gross profit increased $11.8 million or 64.9% to $30.0 million compared to the third quarter of 2020, driven by the increase in net sales and an approximate 540 basis point improvement in gross margin to 24.2% compared to 18.8% in the third quarter of 2020.
Selling, general and administrative .
Adjusted EBITDA was $16.1 million, or 13.0% of net sales, for the third quarter of 2021 representing a more than two-fold dollar increase from $7.4 million, or 7.7% of net sales, in the third quarter of 2020.
Through the Aurora acquisition, Hydrofarm added several key branded and self-manufactured products to its line-up, including Roots Organics and Procision grow media, Soul nutrients, Procision perlite and Aurora Peat Products soil mixes.
On July 19, 2021, the Company completed its previously announced redemption of its outstanding warrants to purchase shares of the Company’s common stock that were issued in connection with a private placement of units.
Prior to the acquisition, Hydrofarm had a distribution relationship with Greenstar via a preferred brand agreement to sell the Grotek brand and a distribution agreement to sell the Gaia Green brands, with Hydrofarm’s distribution representing approximately 50% of Greenstar’s annual sales.
As of September 30, 2021, the Company had cash of approximately $14.5 million and an aggregate principal amount of debt outstanding of $27.7 million, as well as approximately $52 million of additional available borrowing capacity under its revolving credit facility.
Hydrofarm has completed five acquisitions, with only a partial year contribution from each acquisition embedded within the outlook above.
With respect to projected fiscal year 2021 Adjusted EBITDA, a quantitative reconciliation is not available without unreasonable effort due to the variability, complexity and low visibility with respect to certain items, including, but not limited to, stock-based compensation and employer payroll taxes, uncertainties caused by the global COVID-19 pandemic, changes to the regulatory landscape, and certain potential future transaction expenses, which are excluded from Adjusted EBITDA.
The Company will host a conference call to discuss financial results for the third quarter of 2021 today at 4:30 p.m.
A replay will be available after the call until Thursday, November 18, 2021 and can be accessed by dialing 412-317-6671.
Hydrofarm is a leading independent distributor and manufacturer of hydroponics equipment and supplies for controlled environment agriculture, including grow lights, climate control solutions, growing media and nutrients, as well as a broad portfolio of innovative and proprietary branded products.
To supplement our condensed unaudited consolidated financial statements which are prepared in accordance with GAAP, we use “Adjusted EBITDA”, “Adjusted EBITDA as a percent of net sales”, “Pro Forma Adjusted Net Income” and “Pro Forma Adjusted Net Income per Diluted Share” which are non-GAAP financial measures.