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Adjusted Operating Cash Flow Reconciled to Net Cash Flow from Operating Activities (1)---------------------------------------------------------------------------- Three months ended March 31,(millions of dollars) 2013 2012----------------------------------------------------------------------------Net cash flow from operating activities 95.3 120.9Add: Non cash interest expense 1.7 1.7Less: Increase (decrease) in non-cash working capital 4.1 (34.4) Gain on debenture redemption (0.2) - Income tax expense (0.4) (0.2) Finance costs recognized in net earnings (18.5) (21.4)----------------------------------------------------------------------------Adjusted operating cash flow 82.0 66.6--------------------------------------------------------------------------------------------------------------------------------------------------------(1) See the unaudited condensed consolidated financial statements for net cash flow from operating activities and changes in non-cash working capital.
First quarter adjusted operating cash flow was $82.0 million, an increase of $15.4 million or 23% from the prior year quarter. The increase in adjusted operating cash flow was due to higher operating results at all of Superior's segments offset in part by higher corporate costs and an increase in shares outstanding. Adjusted operating cash flow of $0.72 per share, increased by $0.12 per share as compared to the prior year quarter due to a 23% increase in adjusted operating cash flow as noted above offset in part by a 2% increase in the weighted average number of shares outstanding. The average number of shares outstanding increased in 2013 as a result of shares issued from Superior's Dividend Reinvestment Program and Optional Share Purchase Plan (DRIP) and the completion of an equity offering on March 27, 2013.
The net earnings for the first quarter were $31.4 million, compared to net earnings of $27.9 million in the prior year quarter. Net earnings were primarily impacted by an increase in gross profits offset in part by higher unrealized losses on financial instruments in the current quarter and higher income tax expense. The change in the unrealized losses on financial instruments was due principally to losses in the current quarter on Superior's debenture embedded derivatives compared to the prior year quarter as a result of fluctuations in Superior's share price. Revenues of $1,049.9 million were $16.0 million lower than the prior year quarter due to reduced Energy Services revenue as a result of lower heating oil and propane prices offset in part by higher revenue at Specialty Chemicals as a result of increased sales volumes and pricing for some products. Gross profit of $253.1 million was $15.0 million higher than the prior year quarter primarily due to increased Energy Services gross profits due to higher sales volumes and gross margins and Specialty Chemical gross profits due to higher sales volumes and gross margins. Operating expenses of $179.1 million in the first quarter were $1.2 million lower than in the prior year quarter due to reduced amortization expense and one-time restructuring costs offset by higher operating costs associated with increases sales volumes within the Energy Services segment. Total income tax expense for the first quarter was $15.8 million compared to income tax expense of $6.1 million in the prior year quarter. The increase in income tax expense was due to higher net earnings in the first quarter of 2013 as compared to the prior year quarter.
