Today's call is being webcast, and you can view the slides we will be presenting today at our website at www.rockwellcollins.com under the Investor Relations tab. Please note today's presentation and webcast will include certain projections and statements that are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected as a result of certain risks and uncertainties including, but not limited to, those detailed on Slide 2 of the webcast presentation and from time to time in the Securities and Exchange Commission filings. These forward-looking statements are made as of the date hereof, and the company assumes no obligation to update any forward-looking statements.
Now with that, I'll turn the call over to Clay.
Clayton M. Jones
Thanks, Steve, and good morning, everybody on the line. I'm pleased to report that our first quarter 2012 earnings were in line with our expectations. Sales were down slightly, while segment operating earnings increased by 2%.Earnings per share decreased $0.09, but prior year results included a $0.13 benefit from the Federal Research and Development Tax Credit when compared to this year. If you adjust for the differences in the R&D tax credit, our earnings per share would have been up 5%.Now understand that these headline numbers may look relatively unexciting. But it gets a lot more interesting when you look below the headlines, especially considering some of the market conditions we currently face. For example, in Commercial Systems sales increased 13% in the quarter with a robust 14% growth from both OEM and aftermarket segments. And commercial operating margins expanded 170 basis points, fueled by 41% incremental margins after excluding a favorable customer incentive release recorded last year.During the first quarter, we realized the benefit from initial 787 and 747-8 spare sales as these 2 new Boeing aircraft entered service. In fact, most of our aftermarket growth in both Commercial segments was the increased spare sales. Now these sales, while traditionally the lumpiest portion of our business, are the type of additional volume that we expect to fuel double-digit aftermarket growth for the full year.
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