Buckeye Technologies Inc

PROFITABLE SUSTAINABLE GROWTH

Buckeye Technologies Inc.

Investor Presentation

September 2012

Click to edit Master title style

BUCKEYE TECHNOLOGIES INC. 2

Safe Harbor Statement

These slides and the accompanying presentation contain forward-looking statements. Forward-looking statements include information concerning possible or assumed future results of operations, capital expenditures, the outcome of pending legal proceedings and claims, goals and objectives for future operations, including descriptions of the Company’s business strategies and purchase commitments from customers, among other things. These statements are typically identified by words such as ‘‘believe,’’ ‘‘anticipate,’’ ‘‘expect,’’ ‘‘plan,’’ ‘‘intend,’’ ‘‘estimate’’ and similar expressions. Management bases these statements on particular assumptions made in light of industry experience, as well as Management’s perception of historical trends, current conditions, expected future developments and other factors that Management believes are appropriate under the circumstances. These statements are not guarantees of performance or results and involve risks, uncertainties and assumptions. Although Management believes that these forward-looking statements are based on reasonable assumptions, many factors could affect the Company’s actual financial results or results of operations and could cause actual results to differ materially from those expressed in the forward-looking statements. These factors include, among other things, cyclical changes in the demand for some of the Company’s products; changes in pricing policies by the Company or its competitors; changes in the cost of labor, energy and other manufacturing costs; debt levels; the size and timing of significant orders; changes in operating expenses or the need for additional capital expenditures; changes in corporate strategy; and general economic conditions. In light of these risks and uncertainties, there can be no assurance that the results and events contemplated by the forward-looking statements contained in these slides and the accompanying presentation will in fact transpire.



Table of Contents

1. Company Overview

2. Financial Strength

3. Strategy for Continued Value Creation

4. Balanced Approach to Allocating Capital

5. Summary

6. Appendix



Company Overview



Specialty Cellulose & Nonwovens Producer

• Buckeye is the only manufacturer in the world that produces high-end, specialty cellulose products out of both cotton and wood

• We’re also one of the largest airlaid nonwovens producers in the world

• We’ve been growing sales and earnings since 2002

• We’ve made significant improvements to our balance sheet

• We are pursuing a balanced approach of returning cash to shareholders, investing in high return projects and adding complementary assets



Cotton - Memphis, TN

• World’s largest Cotton Cellulose mill

• Highly specialized fibers suitable for applications like specialty cotton papers and LCD displays

Nonwovens - Mount Holly, NC

• World’s largest Airlaid Nonwovens machine

• Leader in airlaid material for wet wipes, a growing market in North America

• Our German facility (not pictured) is also the leader in airlaid material for table top products in Europe

Unique Assets

Wood - Perry, FL

• 1 of 2 Specialty Wood Pulp mills of its kind in the world

• Infrastructure ideal for specialty chemical and renewable energy production



Unique Competitive Advantage – High End Dissolving Pulp

Processing of Trees

• Bark, limbs & needles Utilized for Green Energy

• Log is cut into small chips

• Digesting, washing & screening

• Purification

• Sheeting & Drying

• Packaging & Shipping

50+ Years of Technical Knowledge &

Close Customer Optimization

providing BKI value added

proprietary capabilities. Produces a

natural polymer product.

Cellulose 46%

Extractives 3%

Lignin 27%

Hemicellulose 24%

Slash Pine Chip – Bone Dry



High End Specialty Focus

Increasing Technical Expertise

% Alpha Cellulose

99%

92 - 98%

88%

84 -88%

Our focus: • Higher purity (alpha) cellulose • Technically demanding • More price stability

Total Pulp Market Worldwide Usage (Captive & Market 2011)

Cotton Linter Pulp 1.1

Specialty Wood Pulp 4.0

Fluff Pulp 5.6

Paper Pulp 290.0

Total (ADMT 000,000) 300.7

Based on Buckeye estimates



Fluff23%

Ether8%

CottonPaper

7%

Other10%

Tire Cord13%

Nitrate2%

Automotive Filtration

8%

Acetate19%

Casings6%

Airlaid4%

Airlaid Wipes 55%

Table Top 22%

Towel & Tissue 2%Femcare 18%

Other 3%

Specialty Fibers Nonwoven Materials

Wood Capacity = 465,000 MT

Cotton Capacity = 100,000 MT Airlaid Capacity = 99,000 MT

#1

#1

Diverse Product Mix

%’s based on fiscal 2012 Net Sales

#1

#1

#2

#1



Diverse End Markets

Nonwoven Materials

Specialty Fibers

Fluff Pulp Chemical Cellulose Customized Fibers

27% 18% 40% 15%

Wipes Baby Diapers Tire Cord Ethers

(Thickeners) Filters

UltraFiber

500®

Table Top Femcare LED/LCD Screens Food Casings Currency Papers

%’s based on fiscal 2012 Net Sales

• Buckeye is a leading producer of value-added, cellulose-based specialty products

Specialty Fibers 73%

Nonwoven Materials 27%



Geographic Diversity

Canada / BC

Beijing

Florida

North Carolina

Tennessee

South America 1%

North America 39%

Asia

21%

Other 5%

Germany

Switzerland

Italy France

Region %’s based on fiscal 2012 Sales

United Kingdom

Europe 34%

Nonwovens Sites

Corporate HQ

Cotton Cellulose

Wood Cellulose

Intl. Sales Office

• 69% of sales outside US • 85% of sales produced in US



Financial Strength



Strong Cash Flow / Balanced Allocation of Capital

• ~$109 mm/yr in adjusted cash from operations last 6 years • ~$56 mm/yr average capital spending last 5 years; annual maintenance capital

spend of $30-35 mm/yr • Annual depreciation of about $50 mm • Net debt down to $11.5 mm as of 6/30/12

11192 83

100117

140

38 25

95 32

12

45 49 42 48 57

85

7451 66

89

141

383

10

33

111

92

121 125

212

184

7

11

119

103109

137

215

167

$M

illi

on

s

Adjusted Net Cash Provided by Operating Activities Tax Benefits from Fuel Credits and Site Closures

Sale of Assets Capital Spend

Debt Reduction Share Repurchase

Dividends

2007 2008 2009 2010 2011 2012



$138 $155 $112 $121 $196 $223

$769 $826

$755 $756

$905 $909

17.1%18.1%

14.5%15.9%

21.8%23.9%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

$-

$100

$200

$300

$400

$500

$600

$700

$800

$900

$1,000

2007 2008 2009 2010 2011 2012

GM

/Sal

es

$ M

illio

ns

Adj EBITDA Net Sales GM%

Sales & Earnings Growth

-Fiscal Years ending June 30 * Sales totals and GM % include Americana sales for comparison purposes

• Record sales in FY12 of $909 million

• Record Gross Margin % in FY12 of 24%

• Improving selling prices & mix key drivers of sales and earnings improvement

* *



7.8%8.9%

5.4%

6.6%

13.6%

16.5%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

2007 2008 2009 2010 2011 2012

ROIC

Improving Return on Capital

• Increased selling prices and improved sales mix have contributed to increased income

• Strategic focus to rationalize underperforming assets and investments in high return projects reflected in improved returns

• Additional projects such as the Specialty Wood Expansion and Delta plant closure will contribute to returns > WACC

WACC = 10%



$177 $183

$191

$205 $202 $210

$238

$256

$240

$227 $217

$225

13.6%

16.5%17.4%

16.2%18.0%

21.2%

24.2% 23.3% 23.7% 24.0% 24.3% 23.5%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

$100

$125

$150

$175

$200

$225

$250

$275

GM

% o

f Sal

es

Net

Sal

es ($

Mill

ions

)

Total Sales GM % of Sales

Improving Quarterly Margins

• Recent quarterly sales declines include divestiture/closure of non-core facilities

• Strong specialty price increases partially offset by recent declines in fluff pulp pricing

• Stable Gross Margin approaching 25%

* Sales totals and GM % include Americana sales for comparison purposes

* *



Strategy for Continued Value Creation



Strategy for Continued Value Creation

A) Profitable, Sustainable Growth

B) Continuous Business Improvement

C) Developing People & Org Capability

1. JV’s, M&A or Partnerships that Complement

Assets

2. Driving Organic Growth

3. Asian Strategy & Emerging Markets

4. Sustainability and Energy Strategy

1. Safety, Quality and Reliability

2. Focus on Customers, Cash & Improved Cost

Position

3. Address Under Performing Assets

1. Lean Enterprise Methods

2. Improve Risk Profile

3. Succession Planning

FINANCIAL TARGETS

• Returns > Cost of Capital

• Gross Margin > 25%

• Debt/EBITDA < 2.5

• Growing Cash Flow per Share

• Adj. EPS Growth > 10%

STA

KE

HO

LD

ER

VA

LU

E

= CASH TO SHAREHOLDERS

• Dividends

• Share Repurchases

+



Positioned to take Advantage of Key Megatrends

Key Pertinent Megatrends

• Growth in Emerging Markets increasing demand for our products.

• Aging Population in Developed Countries increasing demand for health care products.

• Focus on Renewable Energy and Sustainability Initiatives

Specialty Wood Pulp

Nonwovens Specialty

Cotton Pulp

Fluff Pulp

BUCKEYE TODAY

Profitable

Sustainable

Growth

BUCKEYE TOMORROW

Growing in Current Markets

Using a Disciplined Capital

Approach.

1

2

New Revenue Streams

derived from

Current Ops

Renewable ENERGY

Renewable CHEMICALS

Shaping Today and Tomorrow

Specialty Wood Pulp

Nonwovens Specialty

Cotton Pulp

Fluff Pulp



Vision for Generating Shareholder Value

($ Millions) CY 2010 CY 2011 Major Drivers CY 2015

Revenues $807 $961 $1,500

Gross Margin/ Adj EBITDA Margin

18% 24% 25%

Adj EBITDA $147 $230 $375

12/31/10 Market Value 12/30/11 MV

?? $840 $1,338

Stock Dividend Yd Dividend

$21.01 0.8% $0.16

$33.44 0.7% $0.24

??

•Organic Growth •Product Mix •Project Transformer •JV/Acquisitions – financed w FCF/Debt

•Product Mix •Lean Enterprise •Energy Independence Project •Restructurings

2015 Revenue x Increased GM Gross Profit approximates EBITDA



Building a Sustainable Business Model

38% Improvement in TIR*

* 2007 Base Year

Implemented Lean

Manufacturing

Responsibly Managed Forest - Triple Chain of Custody

77% Biomass

• 6% Water Reduction* • 32% Waste Reduction*

Buckeye has embarked on a

strategy that embraces the

importance of protecting the

environment and resources

for future generations and

leverages long-term business

and shareholder value.



Balanced Approach to Allocating Capital



Balanced Approach to Allocating Capital

• We will continue to pursue a balanced approach to allocating capital between:

– Returning cash to shareholders

– Investing in high return projects

– Adding complementary assets

• Each opportunity must generate returns greater than our cost of capital



Returning Cash to Shareholders

• Instituted first ever dividend of $0.04 per share in August of 2010

• Raised dividend:

• Repurchased approximately 1.6 million shares (~$43 million) since Q3 FY 2011

• Outstanding authorization to repurchase an additional 4.0 million shares and will do so opportunistically

25% to $0.05 in January 2011 20% to $0.06 in August 2011 17% to $0.07 in January 2012 14% to $0.08 in April 2012



Investing in High Return Projects

Foley Energy Project:

• Successful start-up of 25 MW steam condensing turbine in January 2011

• Final completion March 2012

• Estimated savings of $8 million per year with additional upside potential

• Opportunity to provide “green” energy back to grid

Turbine Generator Building & Cooling Tower

$ 49.0 mm project

$ - 7.4 mm grant

$ - 11.1 mm invest tax credits

$ 30.5 mm net investment



Fluff59%

Specialty41% Fluff

50%Specialty

50%

Before Expansion After Expansion

Wood Capacity = 465,000 MT Wood Capacity = 465,000 MT


Specialty Wood Expansion:

• Increases high-end specialty wood capacity by 42,000 MT per year

• Total mill capacity to remain at 465,000 MT per year

• Customers already committed to 75-80% of new specialty volume

• Expect project completion in April 2013 with no major mill outages

Project Economics

~ $85 mm investment

$ 20.0 mm in annual EBITDA

15 - 20% Return on Investment




Oxygen Delignification on Fluff Pulp Line:

• Uses oxygen to remove lignin in place of chlorine dioxide

• Steam savings project which will more fully leverage Foley Energy Project potential

• Reduces chemical costs and environmental impact

– Significant reduction in waste water color and consumption

• Returns lignin and caustic to the process for use as fuel

• Improves wood yield loss and flexibility for mill optimization

• Startup planned by end of calendar year 2013

• Economics

– $25 – 30MM investment

– Estimated annual savings of approximately $5MM

– IRR of 12 – 15%



Adding Complementary Assets

Pilot Bio-Refinery:

• Partnership with University of Florida to create a pilot bio-refinery

• Will study the use of bio-mass to create renewable chemicals and fuels

• Ribbon cutting ceremony held Jan 9th, facility to begin operations this fall

• Potential future revenue stream(s)

Pilot Bio-Refinery co-located at Florida wood mill

Hemi Cellulose (Sugars)

Other Biomass

Stan Mayfield Bio-Refinery Pilot Plant



Florida Site Energy Vision

Electrical Independence • $49mm investment to increase renewable energy to 95%

• Save equivalent of 200,000 barrels of oil/year

• Reduce 87,500 MT of CO2e

• Incented by $7.4mm grant + $11.1mm Tax Credits

UF Pilot Plant • Partnership with University of Florida (U of F gov’t grant)

• Cellulosic bio-refinery

• Input = Biomass

• Output = Ethanol/Organic Acids

Fossil Fuel Independence • Increase renewable energy to 100%

• Save equivalent of 250,000 barrels of oil/year

• Reduce 100,000 MT of CO2e

• Permit “green” power sales to the grid

Bio-Refinery • Bio-fuels

• Bio-polymers

• Dependent on regulation, technology, and partnership(s)



Summary



Summary

• Buckeye is well positioned with:

– Strong markets that have high barriers to entry

– Strong Balance Sheet

– Strong Free Cash Flow

• Aligned with key global market trends

• Balanced approach to allocating capital between:

– Returning cash to shareholders

– Investing in high return opportunities

– Adding complementary assets

• We are confident that we can profitably and sustainably grow our business while maintaining a strong balance sheet



Appendix



Plant Capacities

SPECIALTY FIBERS NONWOVEN MATERIALS

Facility Capacity Utilization Facility Capacity Utilization

Foley, Florida 465,000 100% Gaston, North Carolina 40,000 65-75%

Memphis, Tennessee 100,000 50-55% Delta, Canada 26,000 50-55%

Lumberton, North Carolina

8,500 100% Steinfurt, Germany 30,000 85-95%

Total Capacity (Tons) 573,500 Total Capacity (Tons)* 99,000

* Nonwoven Material totals based on current product mix



Specialty Fibers

Quarterly Trends

• Specialty wood price increases partially offset by recent decline in fluff pulp prices

• Closed Americana cotton facility Q3-FY12

• Strong operating margins

Annual Trends

• Annual sales increased 29% versus 2007

• Higher selling prices and mix improvements

• Rationalized capacity and reduced costs

$64 $90 $54 $64 $143 $192

$544 $596

$552 $537

$673 $701

11.7%15.2%

9.7%12.0%

21.3%

27.4%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

$0

$100

$200

$300

$400

$500

$600

$700

$800

2007 2008 2009 2010 2011 2012

$ M

illio

ns

Op Income Sales Op Income %

$9 $16 $20 $19 $22 $34 $44 $43 $51 $49 $47 $46

$122 $130 $137 $149 $143

$155

$181 $194

$183 $177 $170 $171

7.0%

12.5%

14.8%

13.0%

15.5%

22.2%24.2%

22.0%

27.8% 27.5% 27.5% 26.9%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

$0

$50

$100

$150

$200

$250 $

Mil

lio

ns

Op Income Reported Sales Op Income %



NonWoven Materials

Quarterly Trends

• Q1-FY12 production issue reduced EBIT by $2.2 mm

• Divested King, NC converting facility Q3-FY12

• Delta consolidation Dec 2012 will increase utilization and improve margin

Annual Trends

• Annual sales decreased 8% versus 2007

• Recent sales declines reflect divestiture of closure of underperforming assets

$21 $15 $12 $17 $14 $12

$259 $264

$240 $247 $265

$239

8.2%

5.8%5.1%

6.8%

5.2% 4.9%

0.0%

3.0%

6.0%

9.0%

12.0%

15.0%

$0

$50

$100

$150

$200

$250

$300

2007 2008 2009 2010 2011 2012

$ M

illio

ns


$5 $5 $3 $4 $5$1 $3

$5$2 $3 $3 $4

$63 $60 $60 $64

$68 $62 $64

$70 $65

$58 $54

$62

8.2% 7.6%

5.6% 5.9%6.8%

1.3%

4.8%

7.5%

3.6%4.7%

5.6% 5.9%

-1.0%

2.0%

5.0%

8.0%

11.0%

14.0%

17.0%

20.0%

$0

$10

$20

$30

$40

$50

$60

$70

$80 $

Mill

ion

s




Specialty Wood Pulp Market

2011 Global Specialty Wood Usage = 4.0 million MT


Competitors:

• Rayonier

• Borregaard

• Sateri Group

• Neucel

• Sappi Saicor

• Tembec

• Cosmo Specialty

Fibers

Filtration Paper 62 Cellulose Ethers

365

Sausage Casings 56

Cellulose Acetate 653

Tirecord 58

MCC 102

Nitrate 80

Sponges 19

Commodity DWP 2,600



Domtar 450 Smurfit 230

GP Cellulose 1,435

Weyerhaeuser 1,445

IP 780

Resolute 270

Rayonier 260

Buckeye 270

Stora 220

Rauma 90

Alto Parana 105

Tembec 25

Fluff Pulp Market

2011 Global Fluff Output = 5.6 million MT


Recent and Planned Additions & Subtractions

Alto Parana Argentina - South America 250,000 * 2012

IP Franklin, VA 270,000 2012

GP Perdue Hill, AL 120,000 2012

GP Perdue Hill, AL 260,000 2013

Rayonier Jessup, GA (260,000) 2013

Buckeye Perry, FL (42,000) 2013

Total vs. 2011 598,000

* Source - RISI



Airlaid Markets

Competitors:

• Glatfelter

• GP Cellulose

• Rexcell/Duni

• KCC


Femcare183

Wipes106

Table Top41

Other45

Total Estimated 2012 Global Airlaid Output = 468 K MT

Estimated 2012 Airlaid Volume for Major Markets

(North America, Europe & China)



Credit Facilities: $300.0 MM 5-year Senior Secured Revolver; matures Oct 2015

Commitment Fee: 37.5 bps

Pricing Grid: Leverage LIBOR Margin

≥ 2.5 2.0 – 2.5 1.5 – 2.0 1.0 – 1.5 ≤ 1.0

275 bps 250 bps 225 bps 200 bps 175 bps

Financial Covenants: Maximum Total Leverage Ratio (Total Debt/EBITDA) of 3.50x with step downs to 3.25x in 2 years and to 3.00x in 4 years

Fixed Charge Coverage Ratio ((EBITDA – Cash Taxes – Dividends) /(Interest + Maintenance CapEx)) of 1.25x

Increase Option: The Facility may be increased by up to $100.0 MM

Credit Facility



Non GAAP Reconciliations

($ Thousands)

Net Cash Provided by Operating Activities 2007 2008 2009 2010 2011 2012

Net Cash provided by Operating Activities 111,361 92,306 121,267 125,490 212,002 171,763

Tax Benefits from Fuel Credits and Site Closures (38,045) (25,367) (95,094) (19,447)

Adjusted Net Cash provided by Operating Activities 111,361 92,306 83,222 100,123 116,908 152,316

Sales 2007 2008 2009 2010 2011 2012

Net Sales 769,529 825,517 754,529 756,426 905,273 909,169

Less Americana Sales 25,431 35,746 26,882 22,533 24,845 14,288

Reported / GAAP Sales 744,098 789,771 727,647 733,893 880,428 894,881

Gross Margin

Gross Margin 131,816 149,562 109,335 121,403 197,769 216,897

Less Americana Gross Margin (3,964) (1,369) (999) (1,529) (4,424) (587)

Reported Gross Margin 135,780 150,931 110,334 122,932 202,193 217,484

Operating Income

Operating Income 81,211 100,333 (22,639) 146,466 130,073 111,541

Less Americana Operating Income (6,966) (1,369) (15,964) (1,529) (4,424) (52,498)

Reported Operating Income 88,177 101,702 (6,675) 147,995 134,497 164,039

Sales Q1-10 Q2-10 Q3-10 Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12

Net Sales 177,274 183,308 190,714 205,130 202,075 209,516 237782 255,900 240,067 227,097 217,065 224,940

Less Americana Sales 5,997 6,891 4,314 5,331 3,591 6,731 7,249 7,274 8,605 5,683 - -

Reported / GAAP Sales 171,277 176,417 186,400 199,799 198,484 202,785 230,533 248,626 231,462 221,414 217,065 224,940

Gross Margin

Gross Margin 24,907 30,214 33,147 33,134 36,313 44,426 57,464 59,566 56,852 54,435 52,819 52,792

Less Americana Gross Margin 826 61 (1,145) (1,271) (1,489) (1,170) (507) (1,258) 586 (559) (343) (271)

Reported Gross Margin 24,081 30,153 34,292 34,405 37,802 45,596 57,971 60,824 56,266 54,994 53,162 53,063

Operating Income

Operating Income 47,962 55,720 23,690 19,094 23,618 31,573 44,016 30,866 44,017 (10,549) 40,347 37,726

Less Americana Operating Income 826 61 (1,145) (1,271) (1,489) (1,170) (507) (1,258) 586 (49,597) (1,246) (2,241)

Reported Operating Income 47,136 55,659 24,835 20,365 25,107 32,743 44,523 32,124 43,431 39,048 41,593 39,967

Americana Reconciliations - Annual

Americana Reconciliations - Quarterly




ADJUSTED EBITDA (in thousands)

2002 2003 2004 2005 (b) 2006 2007 2008 2009 2010 2011 2012

Income (loss) before cumulative effect of (14,504) (24,894) (43,910) 20,204 1,980 30,118 47,102 (65,388) 114,575 124,268 84,863

change in accounting

Income tax expense (benefit) (8,420) (17,122) (26,197) (490) (1,296) 13,720 20,203 13,678 11,237 (8,233) 21,061

Net interest expense 46,553 45,026 45,324 43,586 42,381 37,853 32,469 28,247 16,678 8,190 5,888

Amortization of debt costs 2,033 2,500 1,960 1,556 1,487 1,300 1,088 1,047 946 663 620

Early extinguishment of debt - - 4,940 242 151 832 623 (401) 2,606 3,649 -

Depreciation, depletion and amortization 47,409 49,029 48,133 48,451 49,178 51,592 52,729 49,927 48,180 51,996 52,157

EBITDA 73,071 54,539 30,250 113,549 93,881 135,415 154,214 27,110 194,222 180,533 164,589

Goodwill & Asset impairments 9,984 36,503 45,908 12,326 2,090 - - 138,008 - 13,007 53,601

Loss on disposal of assets - 632 998 1,000 886 1,190 955 1,297 1,096 1,297 799

Gain on sale of assets held for sale - - - (7,203) - (355) - - - - -

Restructuring charges (a) 1,605 1,636 4,364 3,020 3,526 1,249 - - - - -

Restatement due to change in accounting - - 8,525 - - - - - - - -

Non-Cash Charges (450) - - - 598 261 15 256 207 38 846

Adjusted EBITDA per Credit Agreement 84,210 93,310 90,045 122,692 100,981 137,760 155,184 166,671 195,525 194,875 219,835

Alternative Fuel Mixture Credits - - - - - - - (54,232) (77,677) - -

Restructuring charges - - - - - - - - 3,353 1,082 3,063

Adjusted EBITDA 84,210$ 93,310$ 90,045$ 122,692$ 100,981$ 137,760$ 155,184$ 112,439$ 121,201$ 195,957$ 222,898$

Net sales 635,218$ 641,082$ 656,913$ 712,782$ 728,485$ 769,321$ 825,517$ 754,529$ 756,426 905,273 909,169

EBITDA Margin % 13.3% 14.6% 13.7% 17.2% 13.9% 17.9% 18.8% 14.9% 16.0% 21.6% 24.5%

We calculate EBITDA as earnings before cumulative effect of change in accounting plus interest expense, income taxes and depreciation and amortization. Adjusted EBITDA furtheradjusts EBITDA by adding back the following items: asset impairment charges, non-cash charges, restructuring charges and other (gains) losses. You should not consider adjustedEBITDA to be an alternative measure of our net income, as an indicator of operating performance; or our cash flow, as an indicator of liquidity. Although we believe adjusted EBITDA

enhances your understanding of our f inancial condition, this measure, when viewed individually, is not a better indicator of any trend as compared to other measures (e.g., net sales, netearnings, net cash f lows, etc.).

(a) The def inition of Adjusted EBITDA limits the add back of restructuring charges to costs incurred from October 1, 2002 through June 30, 2004, provided that the aggregate amountdoes not exceed $6.0 million. Since we exceeded the $6.0 million threshold during the three months ended June 30, 2004 our add back was limited to $492 of the $2,073 of restructuringexpense recorded during that quarter. (b) Adjusted EBITDA for all years prior to 2006 corresponds with the def inition contained in our old US revolving credit facility.




ADJUSTED EPS

Q1-FY09 Q2-FY09 Q3-FY09 Q4-FY09 Q1-FY10 Q2-FY10 Q3-FY10 Q4-FY10 Q1-FY11 Q2-FY11 Q3-FY11 Q4-FY11 Q1-FY12 Q2-FY12 Q3-FY12 Q4-FY12

Earnings per Share in accordance with GAAP 0.23$ (3.23)$ 0.11$ 1.20$ 1.00$ 1.18$ 0.49$ 0.24$ 1.59$ 0.42$ 0.70$ 0.35$ 1.02$ (0.14)$ 0.64$ 0.58$

Special Items, after-tax, per share:

Restructuring -$ -$ -$ -$ 0.01$ -$ 0.04$ -$ 0.01$ 0.01$ -$ -$ -$ -$ 0.02$ 0.03$

AFMC / CBC -$ -$ -$ (1.02)$ (0.89)$ (0.96)$ (0.11)$ -$ (1.26)$ 0.01$ 0.01$ 0.01$ (0.28)$ 0.09$ 0.01$ 0.05$

Early Extinguishment of Debt -$ -$ -$ -$ -$ -$ 0.03$ 0.02$ -$ 0.06$ -$ -$ -$ -$ -$ -$

Goodwill/Asset Impairment -$ 3.30$ -$ -$ -$ -$ -$ -$ -$ -$ -$ 0.32$ -$ 0.74$ -$ -$

ITC on Prior Period Expenditures -$ -$ -$ -$ -$ -$ (0.17)$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Total Special Items -$ 3.30$ -$ (1.02)$ (0.88)$ (0.96)$ (0.21)$ 0.02$ (1.25)$ 0.08$ 0.01$ 0.33$ (0.28)$ 0.83$ 0.03$ 0.08$

Adjusted Earnings per Share 0.23$ 0.07$ 0.11$ 0.18$ 0.12$ 0.22$ 0.28$ 0.26$ 0.34$ 0.50$ 0.71$ 0.68$ 0.74$ 0.69$ 0.67$ 0.66$

We calculate Adjusted Earnings per Share as Earnings per share excluding restructuring, income f rom the Alternative Fuel Mixt ure Credit (AFMC), income f rom the Cellulosic Biofuel Credit (CBC), early extinguishment of debt, goodwill impairment, and Investment Tax Credits (ITC) on prior period expenditures. We believe that the presentatio n of this non-GAAP measure provides information that is useful to investors as it allows for a more meaningful comparison of this measure to prior periods, but this information should not be considered a substitute for any measures derived in accordance with GAAP. We manage our business units by f inancial

measures which exclude these items. Earnings per Share targets for our all-employee bonus and at-risk compensation also exclude the impact of such items.



Company Contacts

Company Address Buckeye Technologies Inc. 1001 Tillman Street P.O. Box 80407 Memphis, TN 38108-0407

Phone: Fax:

901 320 8100 901 320 8836

Company Contacts Shirley Spears

Investor Relations Assistant

Eric Whaley

Investor Relations Director

Steve Dean

Executive Vice President & CFO

Phone:

Phone:

Phone:

901 320 8125

901 320 8509

901 320 8352

Documents

Buckeye Technologies Inc