HomeMy WebLinkAbout2005 01 25 Attached Report Given to Board Member During MeetingDate: January 25, 2005
THE ATTACHED REPORT WAS GIVEN
TO BOARD MEMBERS DURING THE
MEETING.
III rl +~ r. rr s r^I rr ~r r r Ir ~r Ir ~ Ir Ir rii ~
TRUSCo
CAPITAL
MANAGEMENT
Prepared Exclusively For:
City of Winter Springs
General Employees'
Pension Plan
Investment Review
Fourth Quarter 2004
Blake Myton
Investment Manager
407-237-5816
blake.myton @truscocapital.com
Dianne Garcia
Relationship Manager
407-237-4513
dianne.garcia@suntrust.com
The Hurt Building -Atlanta, GA
Table of Contents
Economic Overview /Market Snapshot
Performance & Portfolio Composition
Fund Fact Sheets
Fund Attribution Summary
Section I
Section II
,Section III
Section IV
Past performance is not indicative of future results. Performance returns are shown gross of
fees. Comments and projections are based on information available at the time of writing
and believed to be accurate, are for informational purposes only, and may not be relied upon
for future investing.
- .s~~.~a
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT ~
r ^^~ r~ r r lllllr r» ~r r r r rr llr r r rr rl
Market Snapshot: December 31, 2004
City of Winter Springs General Employees' Pension Plan
TRUSCO CAPITAL MANAGEMENT 12
r ~ r ~ r ~ ~ ~ ~s ~ ~ . ~ ~ ~ ~^ I~ ~ III
Investment Overview
Our investing
•`nrarrtra" in 200
was don't bet against
the cycle.
Economic activity
picked up in the
forrrth quarter and
oil prices declined
fi•onr recent ltiglts.
Patient investors
were rewarded with
a post-election stock
market rally that
lifted the S&P 500
frill year total retrrrn
to 10.9%n.
Bored returns
improved moderately
during the grrarter,
and the Lehman
Aggregate Bond
Index~rrished rep
4.3°Io for all of 200;
a fifth consecutive
annual gain.
• Stock prices enjoyed apost-election rebound in the fourth quarter helped by improving job growth and lower
oil prices. The S&P 500 gained 9.2% on a total return basis during the quarter and 10.9% for all of 2004. Bond
returns also edged higher in Q4 and finished the year with its fifth consecutive gain. The Lehman Aggregate
Bond Index rose 1.0% for the quarter and 4.3% in 2004. The trailing price/earnings ratio for the S&P 500 rose to
19.5X, and yields on the 10-year Treasury note and the 10-year A-rated corporate bond closed the year at 4.2% and
4.9%, respectively.
• Cyclical economic strength was evident during the period despite ebbing fiscal and monetary support. Job
growth accelerated moderately, consumer spending improved despite higher fuel costs, and the pace of business
activity remained firm. Headline inflation moved higher but was not worrisome, and the Fed raised short-term rates for a
fourth and fifth time.
• While Fed tightening pushed short- and intermediate-term Treasury yields higher in the fourth quarter, longer-
term yield held relatively steady causing the yield curve to flatten further. The High Yield and Credit sectors
outperformed for the quarter and all of 2004.
• Signs of economic strength and a lessening of the energy price "headwind" helped stock prices break out of their ten-
month trading range. Consumer Discretionary and Technology stocks led the Q4 rally closely followed by
Utilities and Industrials. Energy and Utility stocks outperformed for the full year. Small-cap and International
(EAFE) stocks outperformed the S&P 500 in the fourth quarter and for all of 2004. The Value style outperformed
Growth for the full year, but returns were mixed in Q4.
• We remain positive on our outlook for the economy and corporate profits, but the rate of growth in both is
likely to slow closer to historical averages due to lower levels of stimulus and more difficult comparisons,
respectively. Core inflation will likely trend moderately higher, and support the Fed's plan to raise interest rates
gradually in the months ahead. The dollar will likely remain under downward pressure.
• We continue to recommend a modest overweight position in stocks within current asset allocation ranges, due to
the relative attractiveness of stocks versus bonds. However, we recognize that some of the factors that have
favored equities (steep yield curve, accommodative Fed policy, and easy profit comparisons) are changing and
not as favorable. We will continue to be very price sensitive in entry and exit points, but will likely view any market
pullback as an opportunity to build equity positions.
• Infixed-income portfolios, we anticipate moderately higher yields and a further flattening of the yield curve. In this
environment we will maintain a neutral duration barbell maturity structure and an overweight in Treasury
inflation-indexed securities (TIPS). However we have moved to an underweight position in Corporate bonds
(neutral on BBBs) following the sharp narrowing of credit spreads over the past two years and we will be
moving to an underweight in Mortgages.
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT
3
1. llr r r r r s Ir Ir llr r r r Ir l~ r Ir Ir r
Economy: Moderate Growth & Inflation, Rates Up
Job growth
reaceelerated in the
fourth quarter curd
consumer spending
was firm despite
more Fed rate hikes
and rising oil prices.
Output was fit•nt.
The Fed has now
raised the fed fiords
rate five times to
2~/.rte/o and looks to
raise rates further at
a "measured pace"
to remove
"acconunodation. "
Oil prices appear he
moderating from
recent highs, which
will lessen the
current
"headwind." We
look for 3 ~/z°Io
growth over the next
12 months, with a
moderate rise in
inflation.
_..
Neutral Neutral Neutral/ Cyclical job gains now apparent and is
Fading expected to offset diminishing fiscal and
possible monetary stimulus, sustaining but not
accelerating consumer demand. Moderating
oil prices could provide additional support to
lower income consumers. Housing, autos
near peak - no longer mortgage rate-driven.
Neutral Positive Positive Strong cash positions, improving demand,
and higher inventories, along with possible
profits repatriation should continue to support
CAPEX. Business confidence improved.
High Neutral Neutral / Deficit reduction a priority in post-election
fading economy. Defense spending could
possible experience selective cuts.
Low Positive Positive Record trade deficit likely to narrow. Exports
are improving. China policy a key focus.
At Core Moderately Period of declining inflation ending. Rising
inflection inflation higher commodity and energy prices and a lower
point somewhat dollar are putting upward pressure on
higher inflation. Pricing power improving. Benefits
costs up, but wages relatively restrained.
Rising Restrictive Restrictive Five Fed rate hikes in 2004 (6/30, 8/10, 9/21,
toward 11/10, and 12/14). Additional rate hikes
neutral expected to continue at "measured" pace to
remove accommodation..
Stimulative Less Becoming Tax cut impact fading. Focus turning to
Stimulative somewhat budget balance after election.
Restrictive
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 4
l~ r r Ili Ir Ir r lll~ rr r Illr rri Ir ll~ r llr r I~ ^~
Equity Markets Rally in Q4
Egrriry markets • The S&P 500 broke out of a ten-month trading range and rallied 9.2% on a total return basis
enjoyed a post_ in the final quarter to finish 2004 up 10.9%.
election rally, • The economic backdrop strengthened highlighted by an acceleration in job growth, improved
supported by consumer spending, firm business orders and production, a decline in oil prices, and
faster job growth further weakening in the value of the dollar.
acid more
moderate oil • Within this environment, Consumer Discretionary and Information Technology stocks led
the fourth
uarter
followed b
Utilities and Industrials
durin
Ener
was the weakest sector in
q
,
g
y
.
gy
prices. the fourth quarter due in large part to falling oil prices, but Energy was the strongest sector for
all of 2004. Utilities and Telecommunications stocks also performed well in 2004, but the impact
While we look for on the overall S&P 500 was limited due to the small (3%) weighting of each sector in the index.
International equities (EAFE) outperformed the S&P 500 for the quarter and the year.
slower corporate
profits growth iir • Smaller capitalization stocks outperformed larger capitalization stocks in the fourth quarter
the uarters
q and for all of 2004. For the full year, the Value style again outperformed the Growth style.
Specifically, stocks with the highest dividend yield, the lowest price/earninggs ratios, and the lowest
ahead, history earnings growth rates tended to outperform stocks with low yields, high P/Es, and faster earnings
sr~ggests that the growth.
egrriry markets
can move higher. • Year-over-year growth in S&P 500 operating profits was above the 7% long-term average
through the fourth quarter, but the pace of future profits growth is expected to slow. We
project fourth quarter earnings growth closer to 10%, down from the 20+% annual gains in 2003
ear-over-
ear slowin
into earl
2004
with further
2005
We also reco
nize that le
arl
al
d
However stocks y
g
,
y
y
an
y
.
g
g
e
and regulatory changes being discussed and implemented are causing companies to adopt new,
could prove more conservative reporting practices which would also affect profits growth. We believe the cost
of compliance with many of these changes could be significant
vttl~terable if .
long-term yield
~ • The ex ansion in the econom is ex ected to su ort rowth in rofits and a uit rices in
p pp g
p q y P
p
y
rise sr nr rcantl ,
g .f
y '
'
'
the coming quarters, though gains are likely to be restrained by the rise in bond yields
give~t year-eiid within the context of higher fourth quarter valuations. However, gains will tend to be sporadic
valr~ations and volatile as the market sifts out companies with weaker business models. We will continue to
. emphasize individual company fundamentals in our equity selection process, and our purchases
will be both price and timing sensitive.
;.
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT
5
Stock Market Rallied in Q4
Tech & Consumer Disc. Led in Q4 Valuations Raised by Q4 Rally
35 30
30
25
20 25
15
10 '~ 20
o V ~. ~.
_5 15
Disc Stpl Engy Fn Hlth Ind Tech Mat Tel lltil
^ 3-Mos. 13.5 7.9 4.7 7.9 5.2 10.0 13.5 8.6 8.3 12.2
6Mo 122 19 163 83 -05 99 23 124 154 197 10
Trailing PE -Forward PE
^ s.
^ 1-Yr. 13.3 8.2 31.5 10.9 1.7 18.0 2.6 13.2 20.0 24.3 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05
Sector Perforntunce S&P 500 Source: Fctct.Set Trailing & /~~rnearcl P/E Rcttin Source: t3ctse(ine
Earnings Estimates Slower for ~05 Smaller Beat Larger in Q4 and ~04
40% 25
30%
20%
10%
0%
-10%
-20%
30°/
20
15
10
5
0
3-Mos.
^ S&P 100 7.6
^ S&P 500 i
9.2
^ MidCap 12.2 I
- °
89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 SmlCap 13.0
S&P Op. Earnings (YOY°lo) -Olive is est. Source: Trusco Capital Cupitali<ntiort PerFonnnnce
City of Winter Springs General Employees' Pension Plan
v ivva. i iv ~-~i.
3.9
7.2 4.5
10.9 4.5
10.9
9.8 16.5 16.5
11.5 22.6 22.6
Source: S&P
TRUSCO CAPITAL MANAGEMENT 16
r r Ir r r r r r r r Ir r ~r r r ^r r~ r
Fixed Income Markets Summary
I3oitds ga111 ed Ill
the fourth quarter
and the Lehman
Aggregate Bo~zd
Index finished
higher for a fifth
consecutive year.
The yield curve
flattened due to
two more Ted rate
hikes, and credit
spreads narrowed
to historically low
levels.
We will emphasize
a barbell maturity
structure, a~i
overweight
position in TIPS,
and aft
r~nderweight in
Corporates and
Mortgages.
• The Lehman Aggregate Bond Index added 0.95% on a total return basis in the fourth,
despite evidence of a stronger economy and two more quarter-point Fed rate hikes. The
index finished 2004 with a 4.34% return - a fifth consecutive annual gain.
• Longer-term Treasury yields inched higher during the quarter but short- and intermediate-term
yields continued to rise significantly, causing the yield curve to flatten. The yield on the 10-year
note closed 2004 at 4.22% compared with 4.26% at the end of 2003, while the 2-year note finished
at 3.07% compared to 1.84% a year earlier. The yield curve flattened by 36 basis points in Q4 and
127 basis points for the full year.
• Credit spreads narrowed somewhat further in the fourth quarter, and finished lower for
2004. The spread between 10-year "A" rated corporate bonds and 10-year Treasury securities
closed at 71 basis points, the lowest level since 1998 and well below the 98 basis point average of
the past 15 years. Spreads narrowed across the credit spectrum, but still offer some opportunities
in the BBB sector within the investment grade area.
• The Credit and High Yield securities again outperformed the Lehman Aggregate in the
fourth quarter, and were joined by Mortgages. Long maturities outperformed shorter
maturities, and lower quality credits outperformed higher quality on signs of improving
growth and lower default risk.
• We believe that the secular decline in yields that began in 1981 is over, but a sharp rise
from this point is unlikely over the near-term given the Fed's stated policy approach to a
"measured" rise in short-term rates and our expectations that economic growth will moderation.
We are maintaining portfolio durations neutral relative to benchmarks, but have a more
defensive portfolio structure, emphasizing:
• A barbell maturity structure (shorter-term and longer-term securities) which will benefit from a
flatter yield curve due to rising short-term rates.
• Sectors that perform well in rising inflation environments such as Treasury inflation-indexed
securities due to increased demand.
• We have moved to an underweight position in Corporate bonds (neutral weighting in BBBs)
given the relatively narrow credit spreads, and we will move to an underweight position in
Mortgages.
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT
7
.^~ ~ ~r . r . r ~ ~ ~ ~ ~^^~ . ^~ r~ ^~ III ~ ~
Rate Hikes Flatten Curve / Sareads Narrow
Long-maticrity
bond yields held
relatively steady
poiLtt-to-point in
the final quarter
acid
ocrtperformed,
despite two more
Fed rate hikes.
The yield curve
(IOs-2s) flattened
another 36 basis
poiizts during the
quarter and 127
basis points for all
of 2004. Credit
spreads narrowed
somewhat further
in Q4, allowing
credit-sensitive
sectors (with
higher coupons)
to outperform.
Curve Flattened on Fed Rate Hikes
6.0
5.0
4.0
3.0
2.0
1.0
00
200
Credit Spreads Continued to Narrow
150
-12/31 /2004 100
- 9/30/2004
-12/31 /2003
12/31 /2003
. 50
0 5 10 15 20 25 30 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05
Trea.rtu~ Yreld Ctu-re Sourc•c: FnctSet /0-Yr. "A"-Rated Corp. rs. Tren.cnrt• Source: hLerrill !_~nrh
Flatter Curve Benefited Long Maturities Credit /High Yield Led in 2004
12.0 12 0
io.o
s.o
6.0
4.0
2.0
0.0
-2 0
io.o
s. o
6.0
4.0
2.0
o. o
3 Mo 6 Mo 2 Yr 5 Yr 10 Yr 30 Yr Agg G/G I G/C Tr Agy Ged ABS MBS HiYd Mun
^ 3-Mos. 0.46 0.39 -0.02 -0.09 0.30 2.14 ^ 3-Mos. 0.95 0.81 0.43 0.42 0.62 1.27 0.37 1.26 4.58 1.00
^ 6 Mos. 0.83 0.82 1.03 2.88 5.35 9.77 ^ 6 Mos. 4.18 4.40 3.14 3.75 3.32 5.52 2.54 3.90 9.64 4.68
^ 1-Y r. 1.30 1.25 0.89 2.39 4.90 8.87 ^ 1-Y r. 4.34 4.21 3.04 3.54 3.32 5.25 3.01 4.70 11.14 4.43
Trenstu~~ Returns Source: Lehntnn Brothers Aggregate & .Sector Returns .Source: Leluncrn Brothers
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT s
Asset Allocation Update & Summary
• A 60/40 blend of the S&P 500 / Lehman Aggregate rose 5.9% in the fourth quarter and
8.3% for all of 2004. During the quarter and for the year Stocks out erformed Bonds, Small-cap
stocks underperformed Large-ca s, and International stocks (EAFE~outperformed the S&P 500.
The relative performance of the Growth and Value styles was mixed during the fourth quarter,
but Value outperformed Growth for all of 2004.
The Treasury yield curve (3-mos. to 10-yrs.) flattened another 36 basis points (10s-2s) during
the quarter and 127 basis points for all of 2004 as a result of further Fed rate hikes, and
moderate inflation, but still remains relatively steep by historical measures. Credit spreads
narrowed somewhat further in the fourth quarter and are significantly below historical averages.
Credit and High Yield led all sectors in the fourth quarter and for all of 2004.
Our Stock/Bond indicators, while mostly neutral, leaned more bullish in the fourth quarter. We
retain our moderate overweight position in stocks, given where we believe we are in the
economic and earnings cycle. While we are bullish on equities, we acknowledge that
stocks rallied sharply in Q4 and valuations rose, making stocks more vulnerable to a
near-term correction, especially if bond yields rise significantly.
The Value style has enjoyed an extended period of outperformance, and many of our indicators
continue to favor value. However, we believe that profits growth has peaked and will slow
significantly in the coming quarters, which would favor the Growth style. We retain a moderate
overweight in Large-cap stocks and International equities, but are neutral on Growth and
Value.
• In fixed income portfolios, the firming in the economy, the building of inflation pressures, and
likelihood of additional Fed rate hikes continues to favor a modest barbell maturity structure
and an overweight position in Treasury inflation-indexed securities (TIPS). With credit
spreads well in from the wide levels from several years ago, we have moved to an
underweight position in corporate bonds and mortgages, and we are neutral on High
Yield.
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT
r ~ ~ a ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ i ~ ~ ~ r
Asset Allocation: Overweight LC Stocks & Foreign
These graphs
track the rolling
I2-month and
3h-lnontlz relative
pel formance of
key indexes in
Ollr asset
allocation
decision-rnaki»g
process. We are
maintaining a
»loderate
overweight in
stocks, given the
current stage of
the econo»lic
cycle. We also
,favor large-caps
alld foreign
equities.
Stocks Outperformed Bonds in 2004 Small-Cap Run Extended and Vulnerable
40
30
20
10
0
-10
-20
-30
-40
-50
30
20
10
0
-10
-20
-30
_n n
80 82 84 86 88 90 92 94 96 98 00 02 04 80 82 84 86 88 90 92 94 96 98 00 02 04
- S&P 500 - LB Agg. 12 Mo. - S&P 500 - LB Agg. 36 Mo. - S&P 500 - R2000 12 Mo. S&P 500 - R2000 36 Mo.
S&P 500 and Lelunun Aggregate Bond /rulrci Soiure: /hbotsoit S&P _500 and Russell 2000 Sourre: /bhotson
Growth vs. Value Near S-T Extreme Weaker $Dollar Helps Foreign Stocks
•rU
20
0
-20
-40
-60
_on
80 82 84 86 88 90 92 94 96 98 00 02 04 80 82 84 86 88 90 92 94 96 98 00 02 04
- R.Growth - R.Value 12 Mo. - R.Growth - R.Value 36 Mo. - S&P 500 -MSCI 12 Mo. - S&P 500 -MSCI 36 Mo.
Russell Groh°th and Russell Vnlue. Source: lbbotson S&P 500 and MSC/ SAFE /ndex Source: /bbotson
,.;:
~_ u.-_
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 10
4U
30
20
10
0
-10
-20
-30
-40
-50
• Patient investors were rewarded with apost-election rally that lifted the total return on the S&P 500 to 9.2% and
10.9% for all of 2004. Bonds also posted a gain in the fourth quarter and the Lehman Aggregate Bond Index
The economic finished 2004 with its fifth consecutive yearly increase (4.3%.)
expansion is itt- tact
acrd is expected to ~ Job growth, which faltered earlier in the year, accelerated in the fourth quarter, and combined with a late decline in
continue into 200.5 oil prices, supported stronger consumer spending. Business activity remained firm, but the dollar continued to
t/tong/r at a store decline. "Headline" inflation increased moderately. The Fed lifted the fed funds rate twice more to 2'/a%, and
suggested more rate hikes would be needed to achieve a "neutral" monetary policy.
normal pace. Core
inflation will likely
rise gradually.
• The outlook for the economy remains positive, supported by continued business investment and employment gains.
However the pace of growth is expected to slow in 2005 to the longer-term average of 3'/z%. Top line inflation
may slow due to a decline in oil prices, but core inflation is likely to move moderately higher. We expect the
We expected Federal Reserve to respond with a series of Ya-point rate hikes with anear-term goal of achieving interest rate
additional Fed rate "neutrality." Longer term yields are likely to rise, but not dramatically. The dollar is expected to remain under
bikes, and a fitrtlter downward pressure. Corporate earnings growth has begun to moderate. We project 6-7% growth in S&P 500 operating
profits for all of 2005 -near the long-term average.
flattening of the
yield curve.
• Stocks remain cyclically attractive relative to bonds, given the expected continuation of Fed tightening, the risk of
higher inflation, and the downward pressure on the dollar, and we recommend a moderate overweight position in
Stocks rentaitt equities within asset allocation ranges. However, we acknowledge that equities may be vulnerable over the near-term
cyclically attractive, following the post-election rally and the increased valuation levels, especially if long-term yields move significantly higher.
t/tough are more We continue to favor Large-caps over Small-caps and International equities over the S&P 500 within a diversified
vrtltterable to n near- equity portfolio.
term correction if
long-term yields rise ~ While earnings growth is likely to slow in the coming quarters, history has shown that equity prices can move higher when
sigttificatttly. corporate earnings growth slows from high rates. We believe that companies with stronger financial quality (high cash
flow, top line sales growth, low debt) will outperform in this climate, which may support a shift toward the Growth
style. We will continue to be very price sensitive in the entry and exit strategies for individual stocks.
We /rave moved to
an tntde--weight ~ In fixed-income portfolios, we believe yields are at a cyclical and secular low. While yields will generally trend higher, we
position itt corporate believe most of the movement will be in short-term rates causing the yield curve to flatten further from the current level.
bonds and will We recommend a neutral relative duration with a barbell maturity structure, and an overweight position in
reduce mortgages. securities that perform well in rising inflation environments such as Treasury inflation-indexed securities (TIPS).
However, following a significant narrowing of credit spreads, we moved to an underweight position in corporate
bonds and will shift to an underweight in mortgages.
x"~
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT
Summary of Investment Outlook and Strategy
11
r r i ~ ~~ ~ ~ ~ ~ ~ ~ ~ ~~ r ~ ~ ~ ~ ~
Period Ending I Account Activity Summary
December 31, 2004
Past Perfi~rmance is riot indicative of future results.
~~~°
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 12
Period Ending I Performance Comparisons
December 31, 2004
Inception
Trailing Trailing Trailing Trailing to Date
Quarter 12 Months' 36 Months` 60 Months' 120 Months' 133 Months'
Total Equity 11.46% 15.48% 5.16% 4.61% 12.51% 11.30%
SunTrust Retirement High Grade Growth Fund
S & P 500 Barra Growth Index
S & P 500 Index
SunTrust Retirement High Grade Relative Value Fund **
S & P 500 Barra Value Index
S & P 500 Index
STI Classic International Equity Index Fund
MSCI EAFE Index
STI Classic Small Cap Value Fund
Russel12000 Value Index
SunTrust Retirement Small Cap Growth Fund***
Russe112000 Growth Index
S & P Barra 600 Growth Index
SunTrust Retirement Mid Ca E uity Fund
7.91 % 6.62% 1.35% 0.67% 13.47% 12.00%
8.51 % 6.13% 0.63% -7.07% 11.43% 10.64
9.23% 10.88% 3.59% -2.30% 12.07% 11.08
9.14% 14.66% 5.27% 2.02% 11.36% 10.26%
9.93% 15.71 % 6.47% 2.48% 12.23% 11.08%
9.23% 10.88% 3.59% -2.30% 12.07% 1 i.08%
16.36% 21.05% 12.41 % -2.05% 6.96% -
15.32% 20.24% 11.88% -1.18% 5.59% 6.41
14.05% 25.47% 19.11 % 19.29% 16.83% -
13.20% 22.25% 16.50% 17.23% 15.16% 13.72%
16.00% 23.30% 11.53% 8.99% - -
15.08 % 14.31 % 5.79 % -3.57 % -- --
13.99% 22.00 % 12.35% - __ _
p q . . . .
% -- -
Russell Mid Cap Index 13.66% 20.22% 12.17 % 7.59% 14.50% 13.12%
S & P Mid Cap 400 Index 12.16 % 16.48% 10.53 % 9.54 % 16.10% 14.51
Total Fixed Income 0.90% 3.74% 6.08% 7.52% 7.66% 6.65%
SunTrust Retirement High Grade Bond Fund 0.97% 4.12% 6.31% 7.63% 7.73% 6.72%
Lehman Govf Credit Bond Index 0.80% 4.19 % 6.59 % 8.00% 7.80 % 6.71
Lehman Aggregate Bond Index 0.95 % 4.34 % 6.19% 7.71 % 7.72 % 6.71
SunTrust Retirement High Grade Intermediate**** 0.86% 3.69% - - -- -
Lehman Intermediate A+ Govt/Credit Bond Index 0.33 % 2.69 % 5.33% 7.05 % 7.05% 13
01 % 18
04% 1
78% 3
64
6.20
Return is unrauulied.
* * - Gu eptiun 6/.30/2002. LunAer tens re.cult.c ore linked to the STl Chts.cic Grua th and lnronte Fund to .chow results prior to inception.
*** - /rtreptrrm 10/20/2003. Lusher term results ure linked to the STI Classic Sntull Cup Growth Fund to shore results prior to inception.
**** - Inception 10/202003.
Post Perforruunce is not uuficutive of future results. Returns ore shox•n Srus.c of fees.
r!sa-::~
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 13
~ I~ i~ . w r . . ~ 1. ~r . w I~ w i~ ~ 11f~ a~
Period Ending Portfolio Composition
December 31, 2004
Total Cash
Equivalents
7 sO~
Total Fxed
Income 17.9%
Total Equities
74.6%
SunTrust Retirement High Grade Growth Fund $ 2,181,118.76
SunTrust Retirement High Grade Relative Value Fund $ 2,008,255.56
STI Classic International Equity Index Fund $ 1,264,113.48
SunTrust Retirement Small Cap Value Fund $ 713,372.83
SunTrust Retirement Small Cap Growth Fund $ 712,311.31
SunTrust Retirement Mid Cap Equity Fund $ 607,074.16
Total Equities $ 7,486,246.10
SunTrust Retirement High Grade Intermediate Bond Fund $ 900,827.35
SunTrust Retirement High Grade Bond Fund $ 900,636.74
Total Fixed Income $ 1,801,464.09
SunTrust Retirement Reserve Fund $ 751,265.39
Total Cash Equivalents $ 751,265.39
Portfolio Holdings are as of !2/J//Oa and may change at any tune and wUhout notice.
21.7%
20.0%
12.6%
7.1
7.1
6.0%
9.0%
9.0%
17.9%
7.5%
7.5%
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 14
DecembeE3ldl 004 SunTrust Retirement High Grade Growth Fund
Pa.~t per/orw«nce is not
irrdie•atir~e o/ fiuure res«(t,~.
Perfirnrraace retrrrra are
c/rnKVt /;ros.e of feee. Purt/irlio
hnldin/;s «nd elrarrrcteristics
are ns of l2/.3//tM and urge
elr[urge «! [rnt~ time and
rrithuut nurire.
The Fund seeks capital appreciation by
Value Blend Grow[h
NAV:
$56.09 investing primarily in large, wel-
Large established domestic corporations. The
Assets (mil): $59.8 Fund is designed to comply with
Medium guidelines that are based principally on
Florida laws governing the investment
sm,u of municipal retirement plans for fire,
police and general government
Investment Category employees.
Large Growth
• ~ - . . • . -
Security Equity Security Equity
Exxon Nbbil Corp. 2.9% Lexmark International 2.1% Consumer Discretionary
Microsoft Corp. 2.5% Home Depot Inc. 2.0% 7.6~
Consumer Staples
American Express Co. 2.4% General Electric Co. 2.0%
Cisco Systems Inc. 2.2%
Goldman Sachs
2.0% 4.1
Energy 7 2
Oracle Corp. 2.1% Harley-Davidson Inc. 2.0% Financials
'• • • -
Healthcare
Characteristics Fund S&P 500 Index Industrials
Dividend Yield (Current) 1.1% 1.4°%
Information Technology
Market Capitalization ($bil) 66.2 91.7 , 7%
Price-to-Book
3.2x 3.Ox Materials 3 1
~ P/E (12 m0 fWd) 19.6x 17.8x Telecom services 3.3%
EPS Growth (5 yr est)
13.3 12.1 Utilities 1.3
2.9 %
ROE 20.6 16.2
Cash: 3.6%
U.S. Stocks: 96.4%
Non-U.S. Stocks: 0.0%
16.9
11.9%
10.5
20.5
20.6
10.3
X12.7
17.1%
11.8%
20.5
16.0
^ Fund
^ S&P 500 Index
Annualized
Three One Three Five Ten Inception
Months Year Year Year Year 04/01/1990
Fund 7.9% 6.6°0 1.4% 0.7% 13.5% 12.4%
S&I' S(i0 IltrjF~x ~+ ~~"~ 1U q<,, t s>"~ > ,; 17 1"~~ 11 a`'„
Lipper Large Cap Growth Index 10.0% 7.5% -0.7% -9.7% 8.6% 9.3%
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 15
r lllll~ ~ . i ~ ~ ~ l~ r• ill i ~ ills ~ l~ ~ rr ~
DecembeE3ldl 004 ~ SunTrust Retirement High Grade Growth Fund
Part per(orn,am•e is ,tut
iedicatire q/,~uture re.+ultc.
Per(orurnnee returns are
s/toK•rr Krus.v of fires. Port%nliu
koldin;~.c and cl,urncteri.+lics
are a.e q/ /2/3//Oa and n,uv
ehnu,ge nt a,r~• lime and
,rirlruru nonce.
..- ~ .-
The fourth quarter saw a significant rise
in stock prices after three lackluster
quarters. The S&P 500 advanced 9.2%
while the Fund was up 7.9%. During
the fourth quarter, Technology,
Consumer Discretionary, and
Industrials were the strongest sectors
as they are leveraged to the economy.
We were market weighted or over
weighted these sectors and
undetweighted the two worst
performing sectors, Energy and
Healthcare. However the style and size
issues the Fund faced for the first nine
months of the year continued as the
value style & small capitalization
equities out performed large cap
growth for the quarter. For the year
ahead, we anticipate a dramatic drop in
the S&P 500 earnings growth from the
20% level of 2004 to 6% or 7%. That
should shift the investor focus to our
large cap growth style, which is
expected to grow earnings at double
the index values. We also expect large
caps to outperform small caps after six
years of trailing returns.
$0 ~
Apr-90 Apr-92 Apr-94 Apr-96 Apr-98 Apr-00 Apr-02 Apr-04
Fund S&P 500
Fund Manager: ~r~tr+~-~r~~t_7,~•~--•,~•.~~tar•rn:a<t`7~ir<atirauti
Elliott Perny, CFA
3 Year
Alpha Beta R-Squared Sharpe Ratio Std. Deviation
Fund -0.10 0.69 74.48 0.00 11.85
S&P SUi~ liu~ar U Uo 1 i~u inii ~n~ ~i 1', 1:i ttr,
,:
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 16
1997 1998 1999 2000 2001 2002 2003 2003
First Quarter 2.6% 15.4% 5.6% 0.2% -4.8% 2.4% -2.2% 1.3%
Second Quarter 18.8% 5.7% 5.1% 0.6% 5.8% -10.9% 9.6% 1.0%
Third Quarter 7.3% -12.4% -7.7% 2.6% -13.6% -14.9% 2.0% -3.4%
Fourth Quarter 3.7% 25.9% 14.8% -1.7% 12.3% 4.0% 10.4% 7.9%
Fund 35.5% 34.7°% 17.6°% 1.6% -2.3°i° -19.3% 20.9% 6.6%
~;,CI' ~,trti In~f~ .. ,~3 .1°• 't~ ~s" ~'1 t _q.2°:~ 11 ~~"_ 221° 28.7°. tU ~l°~
Lipper Large Cap Growth 28.1% 25.7% 28.0% -10.9% -18.0% -24.2% 27.0% 7.5%
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
~ ~ ~ ~ ~ ~ ~ ~ ~ i i ~ ~ ! ! ~ ~ ~ ~
Period Ending
December 31, 2004
SunTrust Retirement High Grade Relative Value Fund
- ~- ..
e un see cs ong- erm caps a
Value Blend Growth appreciation with a secondary Cash: 3.0%
Large Cusip: 990001182 goal of current income by using a U.S. Stocks: 97.0%
NAV: $12.78 value-oriented investment
Medium Assets (mil): $45.6 strategy. The Fund is designed to
comply with guidelines that are
Small based principally on Florida laws
governing the investment of
Investment Category municipal retirement plans for fire,
Large Value police and general government
.. -
Security %Equity Security %Equity
Exxon Mobil 2.0% General Elec
Citigroup 2.0% American Ele
Rockwell Auto. 2.0% Bank of Ame
WeIlPoint 2.0% Principal Fin
Prudential Financial 1.9% Berkshire Ha
rlC 1
9% consumer Discretionary
.
CtrIC 1
8%
. Consumer Staples
ica 1.8%
ncial 1
8% Energy
.
haway B 1.7%
Fnancials
Fleatthcare 10.3°b
6°ro
Barra Industrials t
r
a
t
13.4
38.8
Characteristic Fund Value 79%
Dividend Yield (Current)
1.8%
2.0°r_
Inf orr
retion Technobgy s.s%
0%
5 Year EPS Growth (Hist.) 14.4% 5.6°~~ 4.8%
Market Capitalization ($bil)
68.8 B
62.0 B Materials
3s%
3.1
Price-to-Book 2.7x 2.1 x Telecom Services
5.8 %
P/E (12 months trailing) 17.9x i 6.3x a.s % ^ Fund
Return on Equity
20.0%
16 ~?° Utilities
s.e% ^ Barra Value Index
- -. - - -
Annualized
Three One Two Inception
Months Year Years 6/30/02
Fund 9.1 % 14.7% 20.5% 10.3%
B,ln~l ~/<lltu~ In~k~~ ,~ ~~, 1 ~~ 7. , , :, ~ ~ ,,
S&P 500 9.2% 10.9% 19.4% 10.4%
~_~
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 17
,,.a%
13.3
9.7
2.7
a.s%
s.s
rr r r r rr r r ~ rr r~ err r! ~ rr ai rr w rr r
Period Ending SunTrust Retirement High Grade Relative Value Fund-
December 31, 2004 continued
2002 2003 2004
Concerns over interest rates, energy First Quarter N/A -4.1 % 2.4%
prices, war in Iraq, and the Second Quarter N/A 13.5% 2.6%
presidential race kept investor Third Quarter -17.4% 2.1 % 0.1
enthusiasm in check for most of the Fourth Quarter 6.5% 14.1 % 9.1
year. Meanwhile, the economy
continued to expand, corporate
profits were solid, and core inflation Fund -12.1 % 26.7% 14.7%
remained low. In the end, investors Barra Value -12.6°° 31.8°o 15.7°~
refocused on the positives rather S&P 500 -10.3% 28.7% 10.9%
than their concerns propelling the
market to a strong rally. Value-
oriented strategies enjoyed a
particularly good year. Similar to the ~• ~ ~ ~ ~ ~ ~ ~ ~
1998 to early 2000 period of strength
in the S&P 500, value indexes proved
difficult to beat in 2004, with ideal $14,000
conditions favoring their particular $13,000
compositions. Although the Fund $12,000
trailed its primary value benchmark, it
fared extremely well against the S&P $11,000
500 as well as other actively
managed large cap value funds. $10,000
$9,000 ~I \ /
~
Conditions are likely to change in
~~//
~ f
2005 and we expect a waning $8,000
~
economic tailwind, profit $7,000 '
deceleration, and renewed Jun Sept Dec Mar Jun Sept Dec March June Sept Dec
appreciation for sustainable earnings - SunTrust Retirement HignGraae Relative value S&PBarra 500 Value
growth. Together, these factors
suggest moderating equity returns
following two above-consensus years
in 2003 and 2004.
Fund Manager:
Charles B. Arrington, CFA
_..
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 1 a
DecembeE3tli 004 ~ STI Classic International Equity Index Fund
Value Blend Growth
Ticker:
SIEIX The Fund seeks to rovide
P
Cash: 1.0%
t.erge
Expense Ratio:
0.81 diversification and capital Non-U.S. Stocks: 99.0%
appreciation by investing in U.S. Stocks: 0.0%
Medium NAV: $12.96
securities of
companies
Small Assets (mil): $461.80 headquartered or based in
foreign countries
to replicate U.5 Slccks Non-U.5 Stocks
o00 990~~
Investment Category the Morgan Stanley EAFE
Foreign Stock GDP Index. ~as^
o~o
..
Securitv %Equity
Securitv %Equity
ENI S.p.A. 17% E.ON AG 1 4% Consumer Discretionary 12.6 a
Siemens AG 1.6% Telefonica S.A. 1.3%
Consumer Staples s.t
6 ~ %
Total S.A. 1.6% Banco Santander 1.1%
Deutsche Telekom AG 1.5%
Deutsche Bank AG
1.0%
Energy 7.a%
74%
Toyota Motor Corp 1.5% BP PLC 1 ~~% Financials 27.6 i
27.6 %
' • • • - Healthcare 5.7 %
5.7°0
MSCI lntlustrials 10.2 %
10.2
Characteristic Fund EAFE GDP
Dividend Yield (Current)
2.4% 2.4% InformationTechnology 6.9%
s.s%
EPS Growth (5 yr est
) 0% 11.0%
11 Materials 7.2%
. . 7.2
Market Capitalization ($bil) 34.8 34.8 9.4%
Telecom Services s
a%
Price-to-Book 2..Ox 2.Ox .
P/E (12 months trailing) 16.1 x 16.1 x ~lltt'~S s s ^ Fund
Return on Equity 14.4% 14.4% ^ MSCI EAFE GDP Weighted
Annualized
Three One Three Five Ten Inception
Months Year Years Years Years 6/01/1994
Fund 16.4% 21.1 °% 12.4% -2.1 % 7.0% 6.3%
MSCI EAFE GDP Weighted t6.6°~ 20.<~`~~ l i ~~`~ -2 :3°-, 5 8''~ 5.4°:,
Lipper International Funds Average 14.2% 18.1 % 10.2% -2.0% 6.4% 9.1
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 19
r r~ ~r ~^ r •~ r. i. .~r r r r r rir r r r
DecembeE3ldl 004 ~ STI Classic International Equity Index Fund -continued
The MSCI EAFE GDP was up 16.6% in
the fourth quarter. The best performing
sectors were Telecommunication
Services +23%, Financials +21 %, and
Utilities +18%. The worst performing
sectors were Consumer Discretionary
+12.9%, Energy +9.7%, and Healthcare
+9.6%. From a country standpoint,
Greece, Austria and Spain were all up
over 24%. The worst performing
markets were Denmark +10.7%, Hong
Kong +10.5% and Singapore +6.4%.
Investors sought out stocks that were
trading at lower valuation multiples and
stocks with higher Dividend Yields.
Smaller cap stocks outperformed larger
cap stocks, and investors rewarded
stocks with high estimated earnings
growth. The Fund returned 16.4%
closely tracking its benchmark.
Fund Manager:
Chad Deakins, CFA
First Quarter 0.5% 17.6% 1.9% -0.6% -12.2% 0.9% -8.2% 4.8%
Second Quarter 11.8% 4.8% 4.3% -4.3% -1.4% -1.5% 20.1% 0.2%
Third Quarter 2.6% -13.0% 5.7% -8.5% -15.5% -20.5% 8.9% -0.9%
Fourth quarter -5.5% 21.3% 16.4% -4.7% 4.5% 5.7% 17.0% 16.4%
Fund 9.0°0 30.0°° 30.7°-° -17.1°° -23.5°° -16.5°° 40.5°b 21.1°°
~'~-15r;1 E AI ~ (~[~F% Wviu~n..ri a a ~- ~~a , ~', 4 ~~s _' t:~ ~, ar) a°, 'U ?°
Lipper International Funds Average 7.3% 12.7% 37.8% -14.7% -19.3% -16.7% 34.7% 18.1%
$25, 000
$20, 000
$15, 000
$10, 000
$5,000 ' r
Jun-94 Jun-95 Jun-96 Jun-97 Jun-98 Jun-99 Jun-00 Jun-01 Jun-02 Jun-03 Jun-04
Fund MSCI EAFE GDP Weighted
Fund
MSCI ~a~:_ C,;~r' `,U .:~~htad
Lipper International Funds
City of Winter Springs General Employees' Pension Plan
3 Year
Alpha Beta R-Squared Sharpe Ratio Std. Deviation
-0.13 1.00 0.99 0.69 4.57
'u ~i Ni 1 _
-0.12 0.98 0.96 0.14 4.45
;,~,
•F
TRUSCO CAPITAL MANAGEMENT 20
r . ~^r ~r r~ r .l~r r r . ~- r r r ~ ~ r r~ ^w
DecembeE3ld,l 004 ~ STI Classic Small Cap Value Fund
Pas? perfornranc•e is out
iudie•ative gFfirtnre re.+rJts.
Perfornranre returns a re
c/loN~u net u/'fees. :Kure
('7l?el(t /r!t'eStlrrent
pcrformm~ce retunr
inJ'urnrntion rrrav he obtained
Ir_v c•alliug /-8/10-87a-~177/I•
option S, ur visiting the .ti T!
Classie• hurrrLs weh.cile al
h rru'. ~licla.csicfunds.cunr.
Purt%olio lurldingc curd
c•hnrac•teristirs are as of
/2/_3//lW arrd Wray rhrurge «t
nny tiure and w•ilhorlt notice.
Value Blend Growth
Largo
Medium
smau
Investment CateoOrv
Small Value
Ticker: SCETX The fund seeks long-term
Expense Ratio: 1.24% capital growth and income by
investing in the stocks of
NAV: $20.26 companies with a market
Assets (mil): $749.1 capitalization between $50
million and $2 billion.
Security %Equity Security %Equity
Harris Corp. 2.8% CHC Helicopter 2.2%
Cooper Cos. 2.8% CBRL Group Inc. 2.1
Reynolds & Reynolds 2.7% Factset Research 2.0%
Brink's Co. 2.5% Airgas Inc. 2.0%
Fair Isaac Corp. 2.3% Cummins Inc. 1.9%
Characteristic
Dividend Yield (Current)
EPS Growth (5 yr est.)
Market Capitalization ($bil)
Price-to-Book
P/E (12 months trailing)
Return on Equity
Fund
1.3%
12.7%
1.9
2.2x
17.9x
14.1%
Russell
2000 Value
1.6%
11.1%
1.0
1.6x
15.6x
8.0%
Fund
fzussell 2000 Value Index
Lipper Small Cap Value Index
Consumer Discretionary
Consumer Staples 3
Fsergy 2'
Financials
Healthcare
Industrials
Information Technobgy
Materials
Telecom Services 1 1 %
1.2%
Utilities
Cash: 0.5%
U.S. Stocks: 79.1%
Non-U.S. Stocks 20.4%
!~ o-,..,
zz.s
13.9
a.o%
1%
%
s.~
15.5 %
33.6
~.9 %
4.8%
21.6%
1a.s %
1zs%
8.5
11.6%
8.4 8
^ Fund
s.3% ^ Russell 2000 Value Index
Annualized
Three One Three Five Ten Inception
Months Year Year Year Year 8/31/1994
14.1 % 25.5% 19.1 % 19.3% 16.8% 16.3%
12.7% 20.7% 16.5% 16.6% 14.4% 13.5%
>:.:~ci:
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 21
rr ~ rM r w r r ~ rr Ir Ir r r r r Ir rr r Ir
Period Ending STI Classic Small Cap Value Fund -continued
December 31, 2004
Pact per/irrurauee is eat
indieatire of frurrre results.
Per%orurcurc•e returns are
s'huK~n uet of./ees. .More
eurrea! irn•e.clment
pe~fonaauee return
irl/irnrtatioa nrat~ he ohtaiued
/~~~ ralliug /-8011-N7a-X7711.
option i, ar visiting Nre .~%'/
Cla.c.cic Fnnds N•ehsite at
~r n• u', stirlrtcsir~unrls. r•unr.
Prrrtlolio holdings nud
eharaeteristics are as q(
l3/.~l/Oa and ntu~• c•ltange at
auv time and H•iUuruf entice.
The STI Classic Small Cap
Value Fund returned 14.1 % for
the quarter versus 13.2% for the
Russell 2000 Value Index.
Higher quality companies
continued to be top performers
for the fourth quarter of 2004.
Superior selection of securities
assisted the Fund in
outperforming the benchmark.
Outperformance was most
evident in the Utilities and
Consumer Discretionary sectors.
The Fund continues its strict
adherence to quality, lower risk
companies which we believe
allows the Fund to outperform in
the long run. We believe that the
market continues to refocus on
fundamentally strong, profitable
companies. This bodes well for
our bottoms-up, dividend paying
investment process which
prefers quality stocks over high
risk, unprofitable companies.
Fund Manager:
Brett Barner, CFA
1997 1998 1999 2000 2001 2002 2003 2004
First Quarter 4.8% 9.7% -13.3% -4.1% 5.5% 9.7% -6.4% 5.7%
Second Quarter 15.0% -8.9% 19.8% 5.9% 8.9% -1.8°/ 17.1% 3.9%
Third Quarter 12.5% -22.0% -8.1 % 6.7% -8.1 % -12.6% 7.9% 0.2%
Fourth Quarter -2.1 % 11.0% 1.9% 9.0% 14.9% 4.3% 15.9% 14.1
Fund 32.6% -13.5% -2.7% 18.0% 21.2% -1.7°i° 37.1 °% 25.5°i°
t,~r.,-Il2iii~r~Vr.ilii~•in~ir~r ;r ~ '2?;'~~ ~di7~. i1~1". lfit~
Lipper Small Cap Value Index 28.8% -6.7% 1.9% 16.1% 17.2% -11.2% 47.5% 20.7%
33~~ -
us o06 -
s+o.oo6
335066
330.6W
325 u06
szo.°o6 -- -
3,5 ~,~
S1O,W6 - -
35 069
V v Sep-95 Sep-96 Sep 91 SeV 9H SW-99 SaV W Sep-01 Sep-02 Sep-63 Sep-Od
Fund Russell 2000 Value
- - -
3 Year
Alpha Beta R-Squared Sharpe Std. Deuation
Fund 0.51 0.73 90.50 1.32 13.43
R~.istiEall 2000 Valrte Index 0.00 1.O(i 100.OU u.til 17.51
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 22
r r rr r r r r r ~r ~ rs r r r r rlr r r r
Period Ending SunTrust Retirement Small Cap Growth Stock Fund
December 31, 2004
fast per%ornranee is nut
indicative q/•fnnrre resrdts.
per~ornumce renrru.c are
shoran gross of fees. port~uliu
Iruldings rrru! eharneteris7irs
are as' of /2/.3//Oa unA uun•
rhrrrtge «t arq~ time and
rriNruru native.
Value Blend Growth The Fund seeks long-term capital Cash: 2.6%
urge NAV: $13.02 appreciation by investing in domestic U.S. Stocks: 97.4%
Assets (mil): $45.1 corporations with a market capitalization
Medium between $50 million and $2 billion. The
u 5 sm~xs
small Fund is designed to comply with guidelines 9~ <°<
that are based principally on Florida laws
governing the investment of municipal
Investment Category retirement plans for fire, police and general ~as~
Small Growth government employees. 26°=
.. -
Security % Equity Security % Equity ,6.~ %
Rofin-Sinar Tech. 1.0% Jos. A. Bank Cloth. 0.9% Consumer Discretionary 2060
z.~ %
Protein Design Labs 1.0% Digi Intl. 0.9% Consumer staples 2 8,
Actuant 1.0% United Therapeutics 0.9% 3.a %
Activision 0.9% Copart 0.9% ~1Qf9Y s.s %
Navigant Consult. 0.9% Scientific Games 0.9% Fnancials s.5 / ,,., %
n.a%
e e e Fleatthcare 16.6
zz.~
Characteristic Fund S&P 600 SCG Industrials ,s.s%
Dividend Yield (Current) 0.2% 0.5% Inf orrration Technology 23.4 %
EPS Growth (3 yr est.) 20.0% 16.3% 181 %
a.2 %
Market Capitalization ($bil) 1.0 1.5 Materials 4 9 %
Price-to-Book 2.8X 3.8X Telecom services o.o % ^ FUnd
0.4
P/E (12 months trailing) 21.8x 23.3x ^ S&P 600 Small Cap Growth Index
Return on Equity 13.9% ° ~;I;t~s o.o%
25.4 /° ~_o~•o
- ~ - - - .-
Small Cap Growth stocks finished the year with double-digit returns in the fourth quarter,
Three Twelve Inception as the S&P 600 Barra Growth and Russell 2000 Growth gained 14.0% and 15.0%,
Months Months 10/20/2003 respectively. Although only one-fourth of managers beat the Russell 2000 Growth
benchmark for the quarter, the Small Cap Growth Fund slightly outpaced its indices with a
Fund 16.0% 23.3% 24.7°io 16.0% return. The Fund also surpassed its peers, exceeding the Lipper Small Growth
category's 14.2% rise. Superior stock selection in the Industrial, Healthcare, an
~~ ~' Gl ~' ~ ~[~! ill Cap Gr~ivdth In~lrx i 1J? ~ ~ ~' !' '~- ;`~ Consumer Discretionary sectors contributed to the Fund's strong performance. Additional
Lipper Small Cap Growth Classification 14.2% 10.7% 11.8% contribution came from the Fund's overweight position in two of the top performin
sectors, Industrials and Technology. Growth stocks outperformed Value for the quarter,
but trailed for the full year.
Fund Manager:
Mark Garfinkel, CFA
4
i City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 23
r r w r r r w ~r r r~ ~ r rr r i~ w rr w w
Period Ending SunTrust Retirement Mid-Cap Equity Fund
December 31, 2004
Past per%arnuuu•e is rro!
indiealir•e gFfature results.
/'erfornrnnee returns are
s'horcn gross of fees. Por?/idio
holdings and chnracleristic.e
are as q~' l1/.3//0,1 and urat~
change at am' time and
Value Blend GrowlA The Fund seeks Ion term ca ital roW[h
NAV: $28.44 g- p g
~ar9e Assets (mil): $23.42 by investing in domestic corporations with
a market capitalization between $1 billion
Medium and $10 billion. The Fund is designed to
smell comply with guidelines that are based
principally on Florida laws governing the
Investment Category investment of municipal retirement plans
Mid-Cap Blend for fire, police and general government
employees.
Security E ui Security Equity
Consumer Discretionary
Monsanto Co. 2.0 % UGI Corp. 1.9
Reynolds American Inc. 2.0 % Student Loan Corp. 1.8 % Consumer Staples 3.5 %
Yum! Brands Inc.
2.0% Rockwell Collins Corp.
1.8°/ a.e
Ball Corp.
2.0% Amerada Hess Corp.
1.7 % s.o %
Energy
s.o%
Equitable Resources Inc. 1.9% Marathon Oil Corp. 1.7°'°
Fnancials
Cash:
Stocks:
0.0%
100.0%
~ 20.0 %
17.6 %
~rithout notice
22.3
2o.s%
F-lealth Care 9~4
1 o.a%
Characteristic Fund ItuS ell Mul CrtP
-__ _ -_ Industrials 1os%
Dividend Yield (Current)
1.6%
1.4°~ 1o.s%
EPS Growth (5 Yr. Est.)
12.0%
12.8°%
Int ormation Technology ,s.s%
15.3
Market Capitalization ($bil) 7.9 7.2 Materials s3
Price-to-Book 2.5x ~' 6X Telecom services o.8% ^ Fund
,.2 %
P/E (12 mo trailing) 16.4x t S3 1 x
a%
s
Utilities . ^ Russell Midcap Index
Price-to-Sales 1.1x i :'x 8O°'°
-. - - -
Annualized
Three One Three Five Seven Inception
Months Year Years Years Years 12/1996
Fund 13.0% 18.0% 1.8°% 3.6% 11.7% 14.0%
IZIIS~FrII Miti-C~I~ Intirrx 1a ~,'", ;'U2°<. t>.2`~_ 7.6°~ !_t ~?''.~ 11.4"~,
Lipper Mid Cap Core Funds Avg 11.9% 15.5% 9.0% 6.3% 13.2% 10.7%
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 24
r r r r r r rr rr r rr r~ r rr r r r jr r rr
Period Ending SunTrust Retirement Mid-Cap Equity Fund -continued
December 31, 2004
Past perfonnaure i.c rtot
indiratir~e of fiuare resalLc.
Perfirruranre returns are
stunen gross of fees. Pnrtfirlio
luddings curd clrnrurteristics
are as of /2LT1/04 and nra~•
eHange at an~~ time arrd
~cithuut notice.
The Russell Mid Cap Index was up
13.7% for the fourth quarter. The best
performing sector was Information
Technology up 20%. The worst
performing sector was Energy up only
2.8%. All other sectors were up
between 11 % to 15%. Cheaper
stocks generally outperformed more
expensive stocks and high beta
stocks dramatically outperformed with
stocks having a beta of 1.7 or higher
returning over 24% on average.
Some of the best performing stocks
were: Verisign up 68% on blockbuster
product release; Aople Computer up
66% on solid growth from its iPod;
and Veritas Software up 60% on
merger deal with Symantec. The
Fund returned 13.0% which was in
line with its benchmark.
Fund Manager:
Chad Deakins, CFA
1997 1998 1999 2000 2001 2002 2003 2004
First Quarter -1.2% 13.8% -0.6% 21.5% -11.7% -5.5% -4.9% 3.8%
Second Quarter 14.5% -1.3% 19.1% -1.5% 16.5% -13.4% 14.1% 0.5%
Third Quarter 16.7% -17.9% -3.1% 6.0% -21.0% -15.3% 4..5% 0.2%
Fourth Quarter -0.5% 25.9% 35.8% -11.6% 24.5% 0.5% 13.2% 13.0%
Fund 31.4°~0 16.0% 55.9°0 12.2°% 1.2°i° -30.4°i 28.4% 18.0°ro
Lipper Mid Cap Core Funds Avg 22.2% 7.8% 28.2% 6.3% -4.9% -17.4% 36.1% 15.5%
$35, 000
$30, 000
$25, 000
$20, 000
$15, 000
$ i o, o00
$5, 000
$0
Dec-96 Dec-97 Dec-98 Dec-99 Dec-00 Dec-O1 Dec-02 Dec-03 Dec-04
Fund Russell Midcap Index
City of Winter Springs General Employees' Pension Plan
TRUSCO CAPITAL MANAGEMENT 125
3 Year
Alpha Beta R-S uared Sharpe Ratio Std. Deviation
Fund -0.29 1.1 0.92 0.02 4.50
Rug:°,~~II Mi~1 ~,;ii index !) ~)f; i)U ~ !1O r) i'~ d 41
Lipper Mid Cap Core Funds -0.21 0.95 0.93 0.16 4.37
~ r r~ r r r~ r r r r r r^r +rr r r r r ~r
Period Ending ~ SunTrust Retirement High Grade Bond Fund
December 31, 2004
Short Int. Lon
Unit Price:
High
Assets (mil)
Medium
Low
Investment Category
Intermediate-Term Bond
Pccsl pe~fonrtaar•e is rtat
indieatir~e of fiurrre results.
Yerfirnunnre rehrrra are
shuH~n gross of fees. /'ortfirlio
!urldings «rrd eharrreteristies
are as qj /2/.31/IW and uray
clrartge rd arty time mrd
trlNrattl nutirr.
Sector Fund ML "A" G/C
Corporate Bond 17.0°io >4.6 '<;
Agency 0.0% 20.3°r°
Mortgages 2.7% 0.0%
US Treasury 68.0% 55.1%
TIPS 10.4% 0.0°~~
ABS 0.0% U 0"~.
•e . e -
Average Rating AGY AAA
Average Coupon 3.6% 5.1
CurrentYeld 3.4% 4.8
Yield-to-Maturity 3.7% 4.0
Average Maturity 7.7 7 3
Effective Duration 4.9 4 9
The fund seeks to provide a
$32.19 high level of total return
$184.02 through current income and
capital appreciation by
investing in domestic corporate
investment grade bonds rated
A or higher by major credit
rating agencies and U.S.
Government securities.
0-1 Vear
1-3 Years
3-5 Years
5-7 Years
7-10 Years
10 + Years
Annualized
Three One Three Fine Ten Inception
Months Year Years Years Years 9/1/89
Fund 1.0% 4.1 % 6.3% 7.6% 7.7% 8.1
Merrill Lynch G/C A Rated and Above 0.6°~° 3.8°0 5.6°% 7.2°~0 7.4°~0 8.7°%
35.5
City of Winter Springs General Employees' Pension Plan TRLISCO CAPITAL MANAGEMENT 2s
Cash: 1.9%
Bonds: 98.1
r r r r r ~r rr r r r i r ~r rr rr r~ r r rr
DecembeE3a,i 004 SunTrust Retirement High Grade Bond Fund
/'aa9 perforuurnce is not
indiratire gf_firhae resullc.
Perfirnnnnee rehrnts are
+'humn xro.e.c of.fee.c. Porlfoliu
turtdirrgs curd cttararleristic.c
are nc of 12/x//0,1 mrd rrra~~
chattxe at arq~ time aed
n~ith„air ocitire.
The Fund had an excellent fourth quarter, 1998 1999 2000 2001 2002 2003 2004
with returns of 1.0% versus 0.6% for the First Quarter 1.7% -0.4% 2.3% 3.2% -0.5% 1.6% 2.9%
Merrill Lynch Government/Credit A or Second C~uarter 2.7% -1.0% 0.7% 0.2% 4.2% 2.5% -3.0%
Higher Index, bringing annual results to Third Quarter 5.2% 0.9% 2.5% 5.2% 5.7% -0.4% 3.3%
4.1% versus 3.8%. Returns were positively Fourth Quarter 0.2% -0.5% 4.9% -0.1% 1.5% -0.1% 1.0%
impacted by two primary strategies: an
aggressive barbell strategy (overweighting
very short and long maturities) to take Fund 10.0% -1.1% 10.7% 8.6% 11.4% 3.6% 4.1%
advantage of the flattening of the yield ^.1, rill I vnch U/C A Rated 9.7°',, -2.2°~~, 12.4°~~, 8.2°i° 11.6% 3.2% 3.8°i°
curve, and increasing our TIPS (Treasury
Inflation Protected Securities) exposure as
the breakeven spreads became very
attractive early in the quarter. We had
reduced our exposure to corporate bonds
as the spreads on these higher rated
securities narrowed to historically tight
levels. As we look toward 2005, we have
reduced our curve flattening trade and are $35,000
now underweight corporates, as we have
already had significant gains in these
areas. $so,ooo
Fund Managers: $25,000
John Talty, CFA and
Perry Troisi
$20,000
$15, 000
$10, 000
~°'
eG
Q
City of Winter Springs General Employees'
~~ ~'• 0cL 0~ 0b 0~ 0rO ~'1 ~0 ~°' ~~ p'~ Q`L $Jc'~ pA A~
ec; ~c; ec ec; z~ ~~ e~ e~ ec; ec; ~c eo ec, e,° ec, ec
J Q 0 ~ ~ ~ ~ ~ Q Q Q ~ Q 0 Q
Fund ML A Rtd G/C
Pension Plan TRUSCO CAPITAL MANAGEMENT
27
r^ r r r r rr r^r r r r r~ r r r r r r w
Period Ending SunTrust Retirement High Grade Intermediate Bond Fund
December 31, 2004
Short Int. Lon
High
Medium
Low
Investment Cateaorv
P«.+t per/irrouuree is not
i«diralive q(./«hrre re.+«/ts'.
Per(or«uuue returns «re
sho+vn gross o/fees. Portfolio
holdings and ch«r«cteristic.+
«re us q/~ l2/_tl/ll-! curd urrn•
ch«nge «t crrn~ time «rrd
rrhlru«t «ntice.
Intermediate-Term Bond
Unit Price:
Assets (mil)
Sector Fund
Corporate Bond 12.1
Agency 0.0%
Mortgages 42.5°i°
US Treasury 33.3%
TIPS 9.7°i°
ABS 0.0°~0
Characteristic Fund
Average Rating AGY
Average Coupon 4.2°i°
Current Yeld 4.1
~ reld-to-Maturity 4.1%
Average Maturity 6.5
Effective Duration 3.2
Leh Agg Int A+
14.9°0
12.8%
47.7°i°
23.0%
0.0°io
1.6°i°
Leh Aqq Int A+
AAPJAAI
4.9%
4.8%
4.3%
5.1
3.3
The fund seeks to provide a Cash: 2.4%
$10.52 high level of total return Bonds: 97.6%
$217.91 through current income and
capital appreciation by ~~
investing in domestic corporate 9~6°%
investment grade bonds rated
A or higher by major credit
rating agencies and U.S. cash
z.a i
Government securities.
0-1 Year 18.7
2.8
35-9=
1-3 Years
44.6
3-5 Years
5-7 Years
7-10 Years
10+ Years
38.2
The Fund had a solid fourth quarter, with returns of 0.9% versus 0.8% for the Lehman
Three Ong Aggregate Intermediate A or Better Index, bringing annual results to 3.7% versus 3.6%.
Returns were positively impacted by two primary strategies: a barbell strategy
Months Year (overweighting very short and longer maturities) to take advantage of the flattening yield
Fund 0.9% 3.7°% curve, and increasing our TIPS (Treasury Inflation Protected Securities) exposure as the
Lehman AUyreUate Iniermediatr A of Better~~ (i Ft°, ; I;-, breakeven spreads became very attractive early in the quarter. We continue to be
underweighted in the mortgage sector which has expensive valuations. As we I ok
toward 2005, we have reduced our curve flattening trade and are underwei ht
corporates, as we have already had significant gains in these areas.
Fund Managers: John Talty, CFA and Perry Troisi
;'..y
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 2$
. rums ~ ~cn r+yy nn r ui oeuer
DecembeE31~,12004 I FUnd AttYlbUtlOn SUCYIYYIaI'y -Appreciated more than 15%
SunTrust Hi h Grade E ui Fund
PARKER HANM~!N COaP S 875.248.20 S 860.098.80 28.91
EMC GORP MASS 5 953,077.06 S 1.101.554.73 28.86
VERITAS SOFTWARE CORP $ 185,903.20 $ - 26.03
WALT DISNEY CO $ 968,748.00 $ 1,110,332.00 24.27
ORACLE CORP $ 684,323.76 $ 1,252,732.04 21.63
MARRIOTT INTL INC NEW $ 1,174,815.60 $ 1,013,348.20 21.32
TIME WARNER INC $ 812,907.24 $ 910,765.70 20.51
SLM CORP $ - $ 874,047.69 20.25
COMPUTER SCIENCES CORP $ 622,191.00 $ 960,544.80 19.68
SOUTHWESTAIRLSCO $ 616,277.76 $ 587,675.44 19.56
DELL INC $ 683,840.40 S 962,856.86 18.37
DEERE & CO $ 1,122,524.50 $ 844,440.00 15.69
BANK NEW YORK INC $ 710.435.35 $ 652,191.30 15.21
SunTrust Hi h Grade E u' Income Fund
PARKER HANNIFIN CORP S 77.459.76 5 69,377.8a 28.89
ROCKWELL AUTOMATION INC S 61.687.80 $ 101,280.20 28.56
EDWARDS AG INC $ 82,776.42 $ 107,636.11 25.29
SPRINT CORP $ 81,526.50 $ 85,732.50 24.09
TELEFLEXINC $ 59,330.00 $ 77,702.24 22.75
PUBLIC SVC ENTERPRISE GRO $ 121,495.20 $ 69,993.04 22.39
NEWELL RUBBERMAID INC $ 70,801.32 $ 110,862.77 22.00
MERRILL LYNCH & CO INC $ 102,025.44 $ 140,579.04 20.56
DIEBOLD INC $ 72,058.10 $ 113,856.39 19.84
PALL CORP $ 55,692.00 $ 68,756.25 18.63
SOUTH FINL GROUP INC $ 36,265.20 $ 43,460.08 15.88
MAY DEPT STORES CO $ 77,556.38 $ 138,944.40 15.78
SAFECO CORP $ - $ 99,517.20 15.50
DU PONT E I DE NEMOURS & $ 127.116.00 $ 153,036.00 15.42
BANK NEW YORK INC $ 85,468.10 S 102,933.60 15.26
MCGRAW HILL COMPANIES INC S 61,281.61 $ 42,932.26 15.10
SunTrust Hi h Grade Relative Value Fund
ARCHER DANIELS MIDLAND CO $ 574,552.26 S 740,045.01 31.82
ROCKWELL AUTOMATION INC 5 714,265.90 $ 861,990.00 28.46
SYSCO CORP $ 195,108.32 $ 239,516.75 27.56
ADVANCED AUTO PTS INC $ 571,418.40 $ 706,742.40 26.98
SEICORP $ 324,607.84 $ 396,154.64 24.79
WALT DISNEY CO $ 453.142.25 $ 547,632.20 24.32
NORFOLK SOUTHERN CORP $ 593,580.66 $ 655,039.00 22.00
EXELON CORP $ 214,453.05 $ 252,521.10 21.18
SUNGARD DATA SYS INC $ 506,966.56 $ 592,323.64 19.18
PRUDENTIAL FINL INC $ 747,841.92 $ 856,551.60 18.14
EXPRESS SCRIPTS INC $ 341,662.86 $ 391,831.44 16.99
INTEL CORP $ 343,507.44 $ 392,647.93 16.80
TEXAS INSTRS INC $ 399,191.52 $ 452,761.80 15.82
MAY DEPT STORES CO $ 491,301.47 $ 546,840.00 15.63
TEXTRON INC $ 329,319.48 $ 443,907.00 15.46
DU PONT E I DE NEMOURS & $ 614,394.00 $ 681,795.00 15.39
PRINCIPAL FINL GROUP INC $ 711,666.45 $ 794,031.30 15.32
INTERNATIONAL BUSINESS MA $ 465,739.68 $ 524,938.50 15.19
SunTrust Retirement Mid Caa Fund
ADVANCED MICRO DEVICES IN $ 59,475.00 $ 84,799.02 69.38
APPLE COMPUTER INC $ 185,225.00 $ 254,637.60 66.19
VERITAS SOFNVARE CORP $ 116,234.00 $ 156,482.55 60.39
PACIFICARE HEALTH SYS INC $ 86,245.00 $ 163,568.88 54.01
MONSANTO CO NEW $ 452,154.30 $ 467,453.25 52.93
ABERCROMBIE & FITCH CO $ 275.310.00 $ 275,127.00 49.32
HUMANA INC $ 162,037.60 $ 224,961.13 48.60
MEMC ELECTRONIC MATERIALS $ - $ 79,685.50 44.38
MCAFEE INC $ 59,797.50 $ 147,311.56 43.93
MARVEL ENTERPRISES INC $ 35,817.60 $ 42,045.44 40.66
NVR INC $ 214,890.00 $ 250,055.00 39.64
LEGG MASON INC $ 85,551.62 $ 95,677.56 38.04
MEDCO HEALTH SOLUTIONS IN $ 140,286.00 $ 156,748.80 34.63
ELECTRONIC ARTS INC $ 377,577.90 $ 238,084.80 34.12
COACH INC $ 135,107.70 $ 151,377.60 32.96
ARCHER DANIELS MIDLAND CO $ 135,840.00 $ 147,513.72 31.77
E TRADE FINL CORP $ 123,050.50 $ 135,327.40 30.91
STUDENT LOAN CORP $ 491,872.50 $ 406,272.00 30.35
LSI LOGIC CORP $ 53,077.65 $ 56,745.40 27.15
CAREMARK RX INC $ - $ 8,871.75 26.89
ADOBE SYS INC $ 179,823.45 $ 188,659.18 26.84
UNIVERSAL TECHNICAL INST $ 56,436.60 $ 59,848.40 26.31
RYLAND GROUP INC $ 550,863.70 $ 307,090.98 24.26
AVAYA INC $ 196,886.56 $ 204,026.40 23.39
SIEBEL SYS INC $ 82,751.50 $ - 23.01
CREE INC $ - $ 67,735.20 22.23
SEPRACOR INC $ 190,242.00 $ 194,971.08 21.71
XEROXCORP $ 285,964.80 $ 290,360.70 20.81
OLD DOMINION FREIGHT LINE $ 64,246.30 $ 64,275.60 20.79
7-ELEVEN INC $ 189,310.50 $ 190,570.15 19.87
SCHOLASTIC CORP $ 172,211.75 $ 173,157.60 19.65
SOUTHWEST AIRLS CO $ 266,339.10 $ 160,683.60 19.55
LENNAR CORP $ 225,624.OD $ 302,274.44 19.40
SUNGARD DATA SYS INC $ 77,727.90 $ 77,822.51 19.18
M D C HLDGS INC $ 237,209.50 $ 235,635.44 18.42
COMPUTER ASSOC INTL INC $ 137,943.50 $ 75,848.52 18.17
BALL CORP $ 562,572.90 $ 445,473.42 17.73
BMC SOFTWARE INC $ 78,733.80 $ 77,748.00 17.65
CIGNA CORP $ 511,084.20 $ 274,483.05 17.17
JEFFERIES GROUP INC NEW $ 153,391.50 $ 150,969.44 17.11
REYNOLDS AMERN INC $ 476,620.20 $ 462,325.20 16.67
YUM BRANDS INC $ 465,760.30 $ 454,343.40 16.29
NATIONAL SEMICONDUCTOR $ 116,717.15 $ 175,066.35 16.04
TEXTRON INC $ 342,559.10 $ 330,919.20 15.28
JUNIPER NETWORKS INC $ 165,082.00 $ 157,131.01 15.21
MCGRAW HILL COMPANIES INC $ 291,266.95 $ 280,295.48 15.19
RADIAN GROUP INC $ 288,937.50 $ 117,500.68 15.18
PRINCIPAL FINL GROUP INC $ 202,331.25 $ 190,862.28 15.12
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT 2s
Period Ending FUnd Attl'IbUtlOn SUCY1CYlal'y -Appreciated more than 15%
December 31, 2004
SunTrust Retirement Small Ca Growth Fund SunTrust Retirement Small Ca Growth Fund
BEBE STORES INC S 302.016.00 S 141.645.00 91.68 ACTUANTCORP $ 387,374.00 S 427,630.00 26.55
ULTRALIFE BATTERIES INC $ 114.921.00 $ 95,305.00 91.25 AFFILIATED MANAGERS GROUP $ 321,240.00 S 352,248.00 26.52
ROCKY SHOES & BOOTS INC $ 175.000.00 $ 318,860.00 70.29 GENERAL MARITIME CORP $ 191,565.00 $ - 26.14
INTUITIVE SURGICAL INC $ 308,583.00 $ 332,166.00 61.70 ELECTRONICS BOUTIQUE HLDG $ 269,390.00 $ 249,052.00 25.92
US XPRESS ENTERPRISES INC $ 274,392.00 $ 146,500.00 58.04 CSK AUTO CORP $ 213,120.00 $ 108,810.00 25.68
CARRIER ACCESS CORP $ 166,800.00 $ 209,328.00 53.67 UNIVERSAL AMER FINL CORP $ - $ 157,794.00 24.89
DIGI INTL $ 325,755.00 $ 395,370.00 50.39 SCIENTIFIC GAMES CORP $ 196,730.00 $ 381,440.00 24.82
SFBC INTL INC $ 276.255.00 $ 327,850.00 50.13 MINE SAFETY APPLIANCES CO $ 272,824.00 $ 273,780.00 24.72
PENN NATIONAL GAMING INC $ 432,280.00 $ 363,300.00 49.88 SILICON IMAGE INC $ - $ 139,910.00 23.68
NETWORK EQUIP TECHNOLOGIE $ 59.490.00 $ 137,480.00 48.56 ELKCORP $ 327,568.00 $ 280,604.00 23.43
COLDWATER CREEK INC $ 229,570.00 $ 262,395.00 47.92 WESTERN DIGITAL CORP $ 151,188.00 $ 346,880.00 23.32
PERFORMANCE TECHNOLOGIES $ 94,800.00 $ 209,491.80 47.15 M / I HOMES INC $ - $ 159,819.00 22.55
MICROSTRATEGY INC $ 184,905.00 $ 271,125.00 46.63 BANK OF THE OZARKS INC $ 175,407.00 $ - 22.41
ACTIVISION INC NEW $ 327,332.00 $ 413,690.00 45.49 SMSA $ 157,974.00 $ 194,344.71 22.05
ROFIN-SINAR TECHNOLOGIES $ 434,824.00 $ 445,725.00 44.49 FLORIDA ROCK INDS INC $ 240,051.00 $ 238,120.00 21.91
HOLOGIC INC $ 132,963.00 $ 164,820.00 42.55 GUITAR CENTER INC $ 255,470.00 $ 268,719.00 21.69
INNOVATIVE SOLUTIONS & SU $ - $ 201,360.96 40.55 MIPS TECHNOLOGIES INC $ - $ 131,438.40 21.45
SI INTL INC $ 201,572.00 $ 240,204.84 40.39 SECURE COMPUTING CORP $ 149,523.00 $ - 21.45
COPART INC $ 316,131.00 $ 381,640.00 39.04 TEXAS INDS INC $ 303,496.00 $ 286,948.00 21.40
POW ER ONE INC $ 184,680.00 $ 223,000.00 37.65 II-VI INC $ 119,034.00 $ 63,735.00 21.37
HYPERION SOLUTIONS CORP $ 183,546.00 $ 228,438.00 37.16 INTEGRATED DEVICE TECHNOL $ 230,864.25 $ 173,400.00 21.30
ASPECT MEDICAL SYS INC $ - $ 278,844.00 36.67 NAVIGANT CONSULTING INC $ 432,612.00 $ 399,000.00 21.13
CENTRAL GARDEN & PET CO $ 113,294.00 $ 137,742.00 36.32 HUNT J B TRANS SVCS INC $ 304,548.00 $ 125,580.00 20.83
MPS GROUP INC $ 125,309.00 $ - 34.72 LABOR READY INC $ 234,134.00 $ 245,340.00 20.68
METROLOGIC INSTRS INC $ 171,180.00 $ 248,625.00 34.07 DENDRITE INTL INC $ 278,876.00 $ 329,800.00 20.35
GEVITY HR INC $ 219,934.00 $ 370,080.00 34.03 CONNS INC $ 181,740.00 $ 188,384.00 20.31
JUPITERMEDIA CORP $ 224,867.40 $ 344,810.00 33.60 PHOENIX COMPANIES INC $ 257,374.00 $ 262,500.00 19.96
SKYWEST INC $ 251,335.00 $ 250,750.00 33.44 VENTIV HEALTH INC $ 169,500.00 $ 331,216.00 19.88
GENLYTE GROUP INC $ 347,706.00 $ 359,856.00 33.06 PALOMAR MEDICAL TECHNOLOG $ 280,576.00 $ 325,875.00 18.93
CYPRESS SEMICONDUCTER COR $ 252,249.40 $ 211,140.00 32.69 OVERNITE CORP $ 154,007.00 $ 156,408.00 18.60
BUILDING MATERIAL HLDG CO $ - $ 114,870.00 32.67 ZENITH NAIL INS CORP $ 211,550.00 $ 224,280.00 18.40
KFORCE INC $ 165,086.00 $ 247,252.50 32.46 WESTELL TECHNOLOGIES INC $ - $ 81,600.00 18.34
GENESCO INC $ 277,890.00 $ 317,628.00 32.23 SURMODICS INC $ - $ 123,212.90 18.09
MARINEMAX INC $ 231,956.00 $ 199,392.00 32.15 SIERRA HEALTH SVCS INC $ - $ 137,775.00 18.04
SILGAN HLDGS INC $ 213,535.60 $ 238,475.52 31.93 T-HO INC $ 116,760.00 $ 119,288.00 17.88
GARDNER DENVER INC $ 184,719.00 $ 230,566.66 31.63 WERNER ENTERPRISES INC $ 324,408.00 $ 330,544.00 17.24
SELECT MEDICAL CORP $ 210,851.00 $ 3,520.00 31.05 QUIKSILVER INC $ 424,514.00 $ 226,404.00 17.19
MARTEN TRANS LTD $ 346,115.64 $ 279,579.00 30.11 EPICOR SOFTWARE CORP $ 123,909.00 $ 126,810.00 17.12
ENGINEERED SUPPORT SYS IN $ 228,200.00 $ 236,880.00 29.78 CLICK COMM INC $ - $ 123,980.05 17.12
OMNIVISION TECHNOLOGIES I $ 127,350.00 $ 88,080.00 29.68 CELADON GROUP INC $ 144,780.00 $ 153,525.00 16.80
PACER INTL INC TENN $ 96,760.00 $ 108,426.00 29.63 CBRL GROUP INC $ 266,992.00 $ 267,840.00 16.29
UNITED THERAPEUTICS CORP $ 202,594.00 $ 383,775.00 29.26 INFINITY PPTY & CAS CORP $ - $ 235,840.00 16.01
CACI INTL INC $ 364,182.00 $ 265,707.00 29.08 RAYOVAC CORP $ 258,230.00 $ 363,664.00 15.98
ASTA FDG INC $ - $ 92,249.08 28.98 MOLDFLOW CORP $ - $ 30,861.90 15.92
ANSYS INC $ 293,407.00 $ 240,450.00 28.94 CENTRAL EURO DISTRIBUTION $ - $ 212,688.00 15.90
GRIFFON CORP $ 318,821.00 $ 337,500.00 27.96 FIRST CASH FINL SVCS $ - $ 245,732.00 15.40
COMMERCIAL METALS CO $ 397,200.00 $ 151,680.00 27.29 PER-SE TECHNOLOGIES INC $ 256,564.00 $ 256,446.00 15.38
W HLDG CO INC $ 275,500.00 $ 303,496.20 27.02 BROWN SHOE CO INC $ 117,782.00 $ - 15.18
VENTANA MEDICAL SYS $ 201,760.00 $ 140,778.00 26.86 RARE HOSPITALITY INTL INC $ 143,910.00 $ - 15.11
City of Winter Springs General Employees' Pension Plan TRUSCO CAPITAL MANAGEMENT so
~ciated more than 15%
5C0 CAPITAL MANAGEMENT i 31