Buckeye Technologies Inc. (NYSE:BKI) today announced third quarter net income of $28.7 million or $0.70 per share. Third quarter earnings included after-tax costs relating to restructuring and accrued interest associated with the cellulosic biofuel credit totaling $0.3 million, or $0.01 per share. This compared to net income of $19.3 million or $0.49 per share in the prior year comparable period, which included net income of $8.3 million, or $0.21 per share, from alternative fuel mixture credits and energy investment tax credits, net of after-tax costs relating to restructuring and early retirement of debt.

Net sales were a record $237.8 million for the third quarter of fiscal 2011, up 25% versus net sales of $190.7 million in the third quarter of fiscal 2010 due to higher selling prices and improved mix.

Excluding special items, adjusted net income was $29.0 million, or $0.71 per share versus third quarter fiscal 2010 adjusted net income* of $11.0 million, or $0.28 per share. The $0.43 per share increase in adjusted EPS*, compared to the prior year period, was largely driven by higher selling prices overall in the specialty fibers segment and somewhat better capacity utilization at our Memphis specialty cotton fibers plant due to some improvement in the availability of cotton linters.

Comparing the third quarter to the second quarter of FY11, sales were up $28.3 million or 14% due to higher selling prices and increased shipment volumes. Adjusted EPS* of $0.71 was up $0.21 compared to $0.50 in the second quarter, driven by higher selling prices and increased shipment volumes.

Chairman and Chief Executive Officer John B. Crowe said, “We were very pleased with our record third quarter financial results. Both sales revenue and earnings showed strong improvement compared both to the same quarter a year ago and to the immediately preceding quarter. During the quarter, strong cash flow generation allowed us to reduce our long-term debt by another $27.5 million to $136.6 million. We continue to be encouraged about our outlook and ability to further increase shareholder value. We are focused on generating returns above our cost of capital and continuing our balanced approach to the allocation of capital.”

Buckeye has scheduled a conference call for April 27, 2011 at 9:00 a.m. ET to discuss third quarter fiscal year 2011 results. Those interested in listening by telephone may dial in at (888) 312-3046 within the United States. International callers should dial (719) 457-2696. Supplemental material for the call will be available on the Company’s website at www.bkitech.com or at www.streetevents.com.

Buckeye, a leading manufacturer and marketer of specialty fibers and nonwoven materials, is headquartered in Memphis, Tennessee, USA. The Company currently operates facilities in the United States, Germany, Canada, and Brazil. Its products are sold worldwide to makers of consumer and industrial goods.

Note Regarding Non-GAAP Financial Measures

*This release includes certain financial information not derived in accordance with generally accepted accounting principles (“GAAP”). The non-GAAP measures presented are “adjusted operating income”, “adjusted net income”, and “adjusted earnings per share” and are equal to net income, operating income and earnings per share excluding the after-tax effects of alternative fuel mixture credits (AFMC) and cellulosic biofuel credits (CBC), investment tax credits (ITC) on prior period expenditures, restructuring cost and early debt extinguishment cost.

Note Regarding Forward-Looking Statements

This press release also contains forward-looking statements within the meaning of the federal securities laws and is intended to qualify for the Safe Harbor from liability established by the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” generally can be identified by the use of forward-looking terminology such as “assumptions,” “target,” “guidance,” “outlook,” “plans,” “projection,” “may,” “will,” “would,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “potential,” or “continue (or the negative or other derivatives of each of these terms or similar terminology). The “forward-looking statements” include, without limitation, statements regarding the economic outlook for the Company and the demand for its products, expected cost reductions associated with our recent move to one-machine operation at our Delta plant and the completion of our Foley energy independence project, and expected levels of cash flow and debt reduction. These statements are based on management’s estimates and assumptions with respect to future events and financial performance and are believed to be reasonable, though are inherently uncertain and difficult to predict. Actual results could differ materially from those projected as a result of certain factors. A discussion of factors that could cause results to vary is included in the Company’s Annual Report on Form 10-K and other period filings with the Securities and Exchange Commission.