In the first half of this year, we will recognize $6 million of charges, half of this in the first quarter from an acquisition-related fair value adjustment to inventory. These charges will not repeat in the back half of this year, so we expect Western's earnings to improve as the year progresses.
Our operating folks continue to do an excellent job of closely managing working capital reflecting our focus on return optimization. We ended the quarter with working capital at 12.3% of annualized sales. Current liabilities include approximately $28 million, associated with an interest rate swap that we entered in 2010. If you exclude that item, working capital was 13% of annualized sales, still well below our 15% target. Cash from operations was strong during the quarter at $65 million. We expect operating cash for the full year of over $325 million, which should once again comfortably exceed the amount required to fund capital expenditures and dividends.
Capital expenditures should be approximately $100 million this year and dividends should require about $160 million. We have maintained our strong financial base and ended the first quarter with net debt at 34% of net capital, which is within our long-term targeted range of 30% to 40%.
In February, we declared a quarterly dividend of $0.28 per share and extended to 41 years our record of consecutive annual dividend increases. At yesterday's closing price of $23.67, the current dividend yield is 4.7%. Given the cash outlay to acquire Western Pneumatic Tube, we did not complete any open market purchases of our stock during the first quarter. However, consistent with our stated priorities for use of excess cash flow, we expect eventually to resume buying back our stock subject to the outlook to the outlook for the economy, our level of cash generation and other potential opportunities to grow the company. For the full year, with strong cash generation, we expect to repurchase some number of our shares but have established no specific repurchase commitment or timetable. We have a standing authorization from our Board to repurchase up to 10 million shares each year.Read the rest of this transcript for free on seekingalpha.com
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