Buckeye Technologies Inc. (NYSE:BKI) today announced fourth quarter adjusted net income* of $27.8 million or $0.68 per share. This excludes an after-tax non-cash asset impairment charge of $13.0 million, or $0.32 per share, relating to our recently announced plans to close our Canadian nonwovens plant by the end of December 2012 as well as other special items of $0.6 million or $0.01 per share. Adjusted net income* rose 162% as compared to the prior year period’s $10.6 million or $0.26 per share, which excluded after-tax costs of $0.9 million or $0.02 per share relating to early retirement of debt and restructuring.

Net sales were a record $256 million for the fourth quarter of fiscal 2011, up 25% versus net sales of $205 million in the fourth quarter of fiscal 2010 due to higher selling prices and increased shipment volume. The $0.42 increase in adjusted EPS*, compared to the prior year period, was also driven by higher selling prices and increased shipment volume.

Comparing the fourth quarter to the third quarter of fiscal 2011, sales were up $18 million or 8% primarily due to a 6% increase in shipment volume. Adjusted EPS* of $0.68 was off $0.03 compared to $0.71 in the third quarter due to a higher effective tax rate, and higher selling, research and administrative expenses, reflecting increased year-end compensation performance accruals. Adjusted pre-tax income was up by $1.0 million compared to the third quarter.

For fiscal year 2011, net sales were $905 million, a new record and up 20% from $756 million in fiscal 2010, primarily driven by higher selling prices. Adjusted net income* for the 2011 fiscal year was a record $90.8 million, or $2.23 per share, compared to $34.9 million or $0.91 per share in fiscal 2010. The growth in net income was due to significantly higher selling prices across all parts of our specialty fibers segment, along with a $0.19 favorable impact from reduced interest expense due to the $141 million debt reduction achieved over the course of the year.

Chairman and Chief Executive Officer John B. Crowe said, “We were pleased with our fourth quarter and our record fiscal year 2011 financial results. Fourth quarter revenue was significantly improved over the same quarter a year ago, surpassing the old record delivered in the preceding quarter. We indicated on our last quarter’s earnings conference call that we expected fourth quarter earnings to be similar to the third quarter, which is the case. Continued excellent free cash flow generation, which amounted to $50 million for the quarter, allowed us to reduce our long-term debt during the quarter by $40 million to $97 million on June 30. At the same time, we repurchased 400,000 shares of Buckeye stock under our outstanding 5.6 million share authorization, representing a return of cash to our shareholders of approximately $10 million. We enter our new fiscal year 2012 with solid momentum.”

Buckeye has scheduled a conference call for Wednesday morning, August 3, at 11:00 a.m. ET to discuss fourth quarter and fiscal year performance. Persons interested in listening by telephone may dial in at (800) 533-7954 within the United States. International callers should dial (785) 830-1924. 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 pre-tax income”, “adjusted net income”, and “adjusted earnings per share” and are equal to net income, pre-tax 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, asset impairment cost, 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.