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TWST: Tracy, which stocks have met or exceeded your earnings estimates over the past year?

Mr. Marshbanks: For the year, and particularly in the fourth quarter, there were very few that exceeded estimates. However, a select few performed admirably on a relative basis during the year in terms of both earnings and stock price, in spite of the massive negative external factors of energy costs, the strong dollar versus the euro, increased hydrocarbon prices, and higher interest rates.

TWST: Tracy, would you like to comment briefly on Intertape (NYSE:ITP), Spartech (NYSE:SEH) and Valspar (NYSE:VAL)?

Mr. Marshbanks: Sure. At the beginning of 2001, Intertape was my pick for the year, and while it is up substantially since then, I still think there’s plenty of room for continued upside. A couple of things on the situation there. A lot of what took them down to the low level at which they started the year were internal issues. A late-1999 integration of information systems, having their salespeople off the road working on data files rather than talking to customers, the delaying of their basket of products and distribution center system — all of these things plagued them through 2000, and late 2000 brought the whole macroeconomic issue into play. Going forward, I’d view Intertape as a company that, while there’s some headwind from external factors in the economy, to a large degree their fate is in their own hands. They’ve essentially got the distribution center set up, the information systems are integrated and functioning, some of the acquisitions they’ve done, which aren’t up to Intertape standards, should be improving during 2001, and they have new products in the pipeline and entering the market. As the year unfolds, I see things improving for them. It’s an aggressive, strong growth company at what is still a very attractive price.

TWST: Tracy, I’ve heard a lot about the need for specialty chemical companies to be innovative. How would you characterize innovation with respect to these companies?

Mr. Marshbanks: I guess if I take it as a group, and always keeping in mind that this is a very heterogeneous group, a good part of it is what I would call “innovationally challenged,” with parts of their business slipping toward a diversified chemical business model. Part of it is that they operate in segments that don’t require or aren’t willing to pay for innovation. On the other hand, there are others that tap into the engine of innovation and to some extent are focusing on sectors outside traditional specialty chemicals, which I would venture look like specialty chemicals companies of 30 to 40 years ago. So it’s spotty, but there are examples, and the market has been rewarding companies that do innovate and invest in growth.

TWST: Tracy? One last word?

Mr. Marshbanks: Well, this is a stock-by-stock group; it’s not a “buy the group” arena as people have already stated. Investors need to take a hard look at each company, where they operate, the quality of the management team, and their competitive position, before they make a decision. That said, there are still good investments to be found.