Melissa Schaeffer
SVP, CFO at Air Products and Chemicals
Thank you, Seifi. As Seifi mentioned earlier, our business performed very well this quarter, despite significant macroeconomic headwinds. Price and volume gained 14% and all profit metrics were up double-digits versus last year. I, too, would like to thank the Air Products team for their continued outstanding efforts.
In March, we were proud to announce the successful issuance of our first-of-its-kind Green Bond with principle amount of $600 million and EUR700 million after publishing our Green Finance framework. With these offerings, Air Products became the first investment-grade U.S. issuer to execute multicurrency Green Bonds on the same day. Additionally, we are very proud to be the first U.S. chemical Company to qualify green and blue hydrogen projects as an eligible expenditure category, which further demonstrates our position as a leader in advancing the world's energy transition.
Now please turn to Slide 9 for a review of our second quarter results. In comparison to last year, volumes increased 6%, driven primarily by better on-site activities. Volume has been positive for eight consecutive quarters. Merchant price is 18% higher compared to last year, the sixth consecutive quarter of double-digit increases. This equates to an 8% price gain for the total Company, for which we saw positive price gains across all regions. This partially was offset by a 1% lower energy cost pass through and currency translation from the strong U.S. dollar, which reduced both sales and EBITDA by about 4%. Despite this headwind, EBITDA improved 13%, and EBITDA margin was 140 basis points higher as strong price, volume and the contribution from the second phase of the Jazan project more than offset higher costs.
ROCE climbed steadily, reaching 11.7%, which is 140 basis points higher than last year. We expect ROCE to further improve as we bring new projects onstream and continue to put the cash on our balance sheet to work. Adjusting for cash, our ROCE would have been 13.5% this quarter. Sequentially, volume was up 3% driven by improvement in merchant and our on-site business.
EBITDA was up 6%, driven by better volume and equity affiliate results.
Now please turn to Slide 10 for a discussion of our earnings per share results. Our second quarter GAAP earnings of $1.97 per share included two non-GAAP items, which had a combined impact of $0.77 per share. First, we recorded a $0.69 charge for business and asset actions primarily related to our previously announced decision to withdraw from Indonesia coal gasification and permanently suspend the construction of a plant in Ukraine due to the ongoing uncertainty regarding Russia's invasion of the country.
Secondly, the non-service components of our defined benefit plans resulted in an $0.08 cost this year, versus a $0.04 gain last year. Excluding the non-GAAP items, our second quarter adjusted earnings was $2.74 per share, up $0.40 or 17% compared to last year, driven by strong pricing and higher equity affiliate income, Price, volume and cost together added $0.40. Our price actions more than offset variable cost increases.
Price, net of variable costs, contributed over $0.70 this quarter, and volume improvements contributed an additional $0.12. Cost was a headwind of $0.44, but this increase does not represent our new run-rate. In addition to inflation and costs related to the execution of our growth strategy, this quarter we saw increased planned maintenance activities, prelaunching project costs and other onetime items we do not expect to repeat. Meanwhile, the completion of the second phase of the Jazan project and good results from our other unconsolidated joint ventures in the Americas and Europe drove equity affiliate income $0.16 higher.
Our consolidated joint ventures also performed well this quarter. And we shared the improved results with our partners as shown in the non-controlling interest line. The effective tax rate was 120 basis points unfavorable due to lower tax benefits this year. We still expect an effective tax rate of 19% to 20% for FY 2023.
Now please turn to Slide 11. Our distributable cash flow continued to improve, driven by growing EBITDA and stable cash expenses, including interest, cash tax and maintenance capex. Over the last 12 months, we generated about $3.2 billion of distributable cash flow or over $14 per share. From our distributable cash flow, we paid over 45% and $1.4 billion as dividends to our shareholders, while maintaining more than $1.7 billion to invest for growth.
Our ability to grow cash flow, especially in challenging conditions, demonstrates the strength and stability of our business, which enables us to continue creating shareholder value by increasing dividends and deploying capital for our high return projects.
Slide 12 provides an update of our capital deployment. Our capital deployment potential through fiscal 2027 remained stable at roughly $35 billion, which includes over $7 billion of cash and additional debt capacity available today, about $15 billion we expect to be available by 2027 and $13 billion already spent. We still believe this capacity is conservative given the potential for additional EBITDA growth, which would generate additional cash flow and additional borrowing capacity. As always, we continue to focus on managing our debt balance to maintain our current targeted AA2 rating.
We have adjusted our backlog to reflect our recent developments, including the successful completion of our second phase of the Jazan project, the lower equity contribution for NEOM expected from the finalization of the project financing and our withdrawal from coal gasification in Indonesia. Our current backlog of about $16 billion will provide a substantial amount of growth in the future, and we are looking to add additional projects. We have already spent 37% and committed 17% of the updated capacity we show on this slide. We have made great progress and still has substantial investment capacity remaining to invest in high-return projects.
We believe that investing in these high return projects is the best way to create shareholder value for the long run. We continue to evaluate our capital deployment options and determine the best way to use the available cash entrusted to us by our shareholders.
Now to begin the review of our business segment results, I'll turn the call over to Dr. Serhan.
