The increase in revenues in our Pigments division for the three months ended March 31, 2012 compared to the same period in 2011 was due to higher average selling prices partially offset by lower sales volumes. Average selling prices increased in all regions of the world primarily as a result of higher raw material costs. Sales volumes decreased primarily due to lower global demand and continued customer destocking, particularly in the Asia Pacific region. The increase in adjusted EBITDA in our Pigments division was primarily due to higher contribution margins.
Corporate, LIFO and other includes unallocated corporate overhead, LIFO inventory valuation reserve adjustments and unallocated foreign exchange gains and losses. Adjusted EBITDA from Corporate, LIFO and other increased by $5 million to a loss of $40 million for the three months ended March 31, 2012 compared to a loss of $45 million for the same period in 2011. The increase in adjusted EBITDA was primarily the result of an $11 million decrease in LIFO inventory valuation expense ($3 million of income in 2012 compared to $8 million of expense in 2011) partially offset by an increase in unallocated foreign currency losses of $5 million ($3 million loss in 2012 compared to $2 million gain in 2011).
During the three months ended March 31, 2012 we recorded income tax expense of $60 million. Our adjusted effective income tax rate for the three months ended March 31, 2012 was approximately 26%. We expect our long term effective income tax rate to be approximately 30 - 35%. We have tax valuation allowances in countries such as Switzerland and the United Kingdom where our Textile Effects and Pigments businesses have meaningful operations. The increase in profitability from our Pigments business has had a significant impact on reducing our adjusted effective income tax rate. During the three months ended March 31, 2012, we paid $13 million in cash for income taxes.
As of March 31, 2012, we had $1,109 million of combined cash and unused borrowing capacity compared to $1,043 million at December 31, 2011. For the three months ended March 31, 2012, our primary net working capital increased by $118 million. During this period, we redeemed approximately $86 million of our 7.5% senior subordinated notes due 2015 and repaid all of the approximately $27 million outstanding under our Australia credit facility.
During the first quarter 2012, we successfully completed an amendment of our senior secured credit facilities that increased the capacity of our revolving credit facility to $400 million and extended the maturity of our revolving credit facility and $346 million of our term loan B facility from 2014 to 2017.
On March 14, 2012, Moody's Investors Service upgraded our corporate credit rating to Ba3. On April 26, 2012, Standard & Poor's Ratings Services upgraded our corporate credit rating to BB.
Total capital expenditures for the three months ended March 31, 2012 were $81 million. We expect to spend approximately $425 to $450 million on capital expenditures in 2012 which approximates our annual depreciation and amortization.
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