Now, let’s turn to adjusted consolidated operating expenses. That came in at $190 million in the first quarter, down 4% from the first quarter of 2023. First quarter expenses were lower than anticipated, driven principally by a reduction in variable compensation expenses, as well as lower GNA expenses as we remain focused on optimizing spending, and driving operating efficiencies across our business. For the second quarter, we are expecting adjusted operating expenses of $196 million to $200 million, representing another year-over-year reduction. As we remain focused on making progress towards our — I’m sorry, we remain focused on making progress toward our 2026 consolidated operating margin target. We will get there by continuing to drive cost efficiencies in our business, while also further sharpening our portfolio of business activities, including actions like the one I described during the Aviation overview, or the Avinode sale, which I’ll update you on in a moment.
These types of actions should enable us to continue to simplify our story, while achieving increased profitability and greater shareholder returns. Interest expense was $29 million in the fourth quarter — in the first quarter sorry, down 16% year-over-year as our team remains focused on optimizing our working capital position and related cash flow. We expect another year-over-year decline in interest expense in the second quarter and expect interest to be generally flat sequentially. With more doubt surrounding any interest rate reductions this year, we will need to continue driving balance sheet efficiencies in order to further reduce interest expense in the second half of the year. Our adjusted effective tax rate for the first quarter was only 11%, which is well below our full year guidance of 23 to 27% due to the impact of certain discrete tax benefits realized during the first quarter.
Our expectations for the balance of the year remains in that 23% to 27% effective tax rate range that we projected going into the year, the lower first quarter rate should reduce our full year tax rate closer to the lower end of that range. Cash flow was clearly a highlight for the first quarter, as we generated $110 million of operating cash flow and $93 million of free cash flow. While we did benefit a bit from the extended Easter holiday weekend that occurred in many parts of the world right at quarter end. Regardless, we still delivered a very strong result in the first quarter. This cash flow generation further supports our strong liquidity profile, which provides us with the capital we need to invest in organic business activities, funds strategic investment opportunities, and return capital to our shareholders.
Our growing competence in our cash flow generation allowed us to announce a 21% dividend increase during the first quarter. Our strong cash flow performance also enabled us to reduce our net debt to $562 million with an anticipated further reduction in net debt in the second quarter, driven in part by the anticipated closing of the Avinode transaction within the next several days. As mentioned at Investor Day, this transaction holds results in gross proceeds of approximately $200 million and a corresponding after-tax gain, which we still expect to be in the range of $75 million to $80 million. Delivering capital returns through share buybacks and dividends remains an important part of our balanced capital allocation framework and there are no changes to our related go-forward priorities, many of which we shared at our Investor Day event last month.
So, in closing, while our land business experienced weather-related challenges during the first quarter, we are very encouraged by the continued progress we are making in our core North American Liquid Fuels business centered around higher return ratable cardlock and retail activity. And our Aviation and Marine businesses perform well. With Aviation gross profit up year-over-year and Marine maintaining strong unit margins. We generated again $110 million in operating cash flow and $93 million of free cash flow in the first quarter, demonstrating our continued focus on all balance sheet levers. And we remain focused on driving greater operating expense efficiencies with a 4% expense reduction year-over-year, and literally a daily focus on driving our operating margin in the right direction towards our 2026 stated goal.
And the Avinode sale announced during the first quarter, which again should close very soon, again demonstrates our commitment to sharpening our portfolio of business activities and simplifying our story. We plan to use the proceeds of the sale to reduce our net debt in the short-term, but longer term, these proceeds provide additional capital to invest in synergistic opportunities in our core business, where our pipeline of opportunities continues to grow. Before we take your questions, I just want to reiterate the medium term financial targets we shared at Investor Day, whether it’s driving adjusted EBITDA growth, improving our adjusted operating margin, or generating free cash flow as we did this quarter, these all remain priorities. And if we execute well, progress towards these targets should drive increased returns for our shareholders.
Thank you. And I would now like to turn the call back to our operator to begin Q&A.
Ken Hoexter: Hey, great. Good afternoon Ira and Michael.
Michael Kasbar: Hey Ken.
Ken Hoexter: Just want to talk to you about the Marine — your outlook on Marine, you gave second quarter thoughts, does that mean you’re going to decline sequentially on the operating income? So, when you say it’s going to be like 2023 or I just want to understand if you can clarify that a little bit? Thanks.
Ira Birns: Yes, I think he got that right or you did get that right. We, we said we’re going to be closer — the year-over-year comparisons had been weak for a while now, because of the phenomenal year that Marine had in 2022, which really lasted through the first quarter to some extent. So, that’s starting to normalize. So, we said we’d be pretty close to last year’s number. But you’re right, we also — I also said we’d be down sequentially. That’s not a volume. I think volumes will be generally consistent with Q1. But we’re starting to see a little bit of softening in margin. The team has done a great job in keeping margins well above historical norms. We still expect them to remain well above those norms in the second quarter. But from what we’re seeing so far, in April, they’re coming in a little lighter than they did in the first quarter.
Ken Hoexter: And then just for my follow-up, you talked about land getting impacted by weather, I just want understand how much kind of came post Analyst Day? And then if we delve into that where it seemed like you had a limit work to eliminate seasonality, right from what was just U.K. to kind of balancing out the network, should that be balanced with 1Q with these low levels or you expect a rebound given the elimination of the weather? I just want to understand kind of your messaging on the land side?
