Next, back in April, we indicated we expected our full year EPS to be approximately $5.30 in 2012 and we are still on track for that target. And I'd remind you that this would be 10% earnings growth. And lastly, we indicated we expected to generate $1 billion of free cash over the next 2 years. And again, we're on track to deliver on that commitment. Given all the portfolio work we've done over the last several years, including the acquisition of Solutia, we now have a portfolio of businesses that we expect will generate solid, consistent earnings growth and cash generation for years to come.
On Slide 4, I'll cover Eastman corporate results. Sales revenue declined 2%, driven mostly by the Specialty Plastics and Fibers segments. Operating earnings increased with particular strength in the CASPI and PCI segments. Second quarter EPS was $1.40, slightly below second quarter 2011 EPS. And I'd remind you that last year's second quarter EPS was a record for any quarter. And second quarter 2012 is the second highest EPS we've ever reported.
We also had a higher tax rate year-over-year, up about 300 basis points, primarily due to the mix of earnings being more domestic. And overall, our heritage Eastman businesses continue to deliver strong results, despite an uncertain global economic environment.
Before I give some color on the heritage Eastman segments beginning on Slide 5 with CASPI, I'll remind you that second quarter will be the last time we report on this basis. When we announced the close of the Solutia transaction, we also announced the new organizational structure with 5 segments, and we will report on that basis beginning with the third quarter.With that said, sales revenue for CASPI was pretty stable year-over-year, down 1%. Operating earnings increased to a quarterly record of $114 million, up $10 million year-over-year and $16 million sequentially. They were able to increase spread, primarily in solvents, as the decline in raw material and energy costs was only partially offset by lower selling prices, which were down 1%. And we continue to expect the underlying CASPI business to deliver strong results in 2012, albeit with some seasonal decline in demand. Read the rest of this transcript for free on seekingalpha.com
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts