Mr. Roberts: They came in a little weaker than we were expecting. There is some noise in them. I think we have to abstract a little from the short-term noise and see where we are in the cycle. That is probably where we should be focusing.
TWST: What has caused the shortfall that you have seen?
Mr. Roberts: It's input costs. That's one of the key things. We saw it clearly
in the International Paper (IP) results, with higher costs of energy, chemicals,
distribution and fiber. It is interesting to note that when we look at the
output prices, they are clearly hovering near a cyclical peak. However, profit
margins are well below those achieved at previous peaks. One of the reasons is
exactly what I have mentioned — it is because we have this cost-push pressure on
product prices.
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