Final Results

Annual Financial Report Announcement
Impax Environmental Markets plc

Year ended 31 December 2008

CHAIRMAN'S STATEMENT

Since my last communication  with shareholders at  the end of  August
2008, the global  economy and financial  markets have experienced  an
unprecedented upheaval.  Impax Environmental  Markets plc ("IEM",  or
the "Company") has not been immune to these difficult conditions  and
the value  of  the Company  fell  slightly more  than  global  equity
markets over the year with  particular weakness in the second  half.
While the environmental  markets undoubtedly face  challenges in  the
form of  weakening  economies,  tighter  credit  conditions  and  low
commodity prices, I am encouraged by the continued government support
for the sector through stimulus packages and new legislation.

The various positive  and negative developments  for the Company  are
discussed in more detail in  the Manager's Report.  In particular,  I
would like to highlight the potential implications for IEM  following
the election  of Barack  Obama as  the new  President of  the  United
States.  Domestically, Mr. Obama has allocated a substantial part  of
the US$  787 billion  economic stimulus  package to  promote  various
environmental markets, and  is set to  support several  environmental
regulations that had been blocked by the previous Administration.  At
an international level, the new President has already signalled  that
he will be constructive in seeking a successor to the Kyoto  Protocol
for the control of global carbon dioxide emissions, which expires  in
2012.

Performance and Current Status

During the year, the Company's  net asset value ("NAV") per  Ordinary
Share (excluding current year net revenue and taking into account the
dilution effect of the  warrants in issue)  decreased from 127.9p  to
98.8p, an overall decline of 23  per cent while the share price  fell
34 per cent  from 128.9p to  85.0p.  Over the  same period, the  MSCI
World and  the  MSCI  World  Small  Cap  Indices  (priced  in  Pounds
Sterling) fell by 21 per cent  and 22 per cent respectively.   Whilst
slightly under performing  these indices,  the Company  out-performed
most  competing   environmental   markets  funds,   thereby   further
demonstrating the  benefits of  a  portfolio diversified  across  the
energy, water and waste sub sectors.  Over a longer five year period,
the Company has  out-performed, with  growth in  NAV of  49 per  cent
compared to 22 per cent for the MSCI World Index and 23 per cent  for
the MSCI World Small Cap Index.

The IEM share price  tended to trade on  a small discount during  the
second half of the year, and this widened in late December to  almost
15 per  cent.   The warrants  in  the  Company that  were  issued  in
December 2005 were priced at 45.0p at the start of 2008 and at  21.5p
at the end of December 2008.

Into 2009, credit issues and macroeconomic concerns have continued to
drive equity markets, which have generally seen further declines.  As
at 13 March 2009, the  diluted NAV has fallen  14 per cent since  the
start of  the year,  while the  share price  has decreased  by 4  per
cent.  The MSCI World Index (in  Pounds Sterling) has also fallen  14
per cent over the same period.   The discount of the Company's  share
price to NAV has narrowed from 15 per cent at the end of the year  to
5 per cent.

The universe of Environmental Markets stocks continues to expand  and
comprises over 800 companies with an aggregate market  capitalisation
of more  than £160  billion.  With  Initial Public  Offering  ("IPO")
markets closed, the Manager  is also seeing strong  deal flow in  the
late stage  development  capital  area, although  the  current  focus
remains on the  existing unquoted portfolio.   Against a  challenging
macro economic backdrop, IEM's unquoted investments have been  marked
down, and  represented 5  per cent  of  the IEM  portfolio as  at  31
December 2008.

Dividend

The Company's  net  revenue return  for  the year  was  £2.7  million
reflecting  strong  cash  flow  generation  by  a  number  of   IEM's
companies.  In order to retain investment trust status, IEM must  pay
a dividend in respect of the year ended 31 December 2008 of at  least
0.7p per  share.  The  directors recommend  a dividend  of 0.85p  per
Ordinary Share (0.3p per  share in 2007), which,  if approved at  the
Company's Annual General Meeting, will be paid to shareholders on the
register as at the close of business on 17 April 2009.  It should not
be assumed that this level of dividend will be paid in future years.

Share Issues and Buybacks

The Company issued 3.5 million shares at a premium to NAV during  the
course of the year through a  tap issue.  In addition 659,168  shares
were issued  following the  warrant subscription  in June  2008.   In
March 2009, the  Company has commenced  selective share buy-backs  in
response to the increased share price discount to NAV.

VAT on investment management fees

Since the year  end, the Company  has received a  repayment from  the
Manager of £343,000 in relation  to unrecovered VAT paid in  previous
years.  This repayment has been accrued in the accounts for the  year
just ended. In  aggregate, through  the above repayment  and its  own
voluntary VAT registration, the Company has recovered 97 per cent  of
the total  VAT  on  investment  management  fees  it  had  previously
suffered.

Outlook

The economic  outlook remains  extremely challenging,  affecting  the
prospects for certain  environmental markets in  the short term,  and
thereby explaining the reduced  earnings growth expectations for  the
Company's holdings over the next twelve months.  Whilst not immune to
the  economic  cycle,  continued   strong  legislative  support   and
government spend  should offer  the Company  some limited  protection
from a protracted recession.  On valuation, it is interesting to note
that the price-earnings ratio of the portfolio has fallen to a  level
that is  only slightly  higher  than that  of  the MSCI  World  Index
despite offering substantially higher growth prospects.

On this basis, the Manager and directors continue to believe that the
shares of IEM offer an  attractive opportunity for investors to  gain
exposure to the long term growth potential inherent in  Environmental
Markets.

Richard Bernays
17 March 2009

MANAGER'S REPORT

Notwithstanding weak markets in the  second half, the Company's  full
year  performance  was   ahead  of  many   funds  investing  in   the
environmental space, some  of which  saw declines of  30-40 per  cent
(priced in pounds sterling).  With a  23 per cent decline in  diluted
NAV (ex  income)  during the  year,  the Company  performed  slightly
behind small cap markets (the MSCI World Small Cap Index declined  22
per cent).  This reflects a relatively strong first half (the Company
NAV was down 4 per  cent vs. MSCI World Small  Cap Index down 10  per
cent) and pronounced relative weakness  in the second half, when  the
Company NAV declined 20 per  cent vs. a 13  per cent decline for  the
MSCI World Small Cap Index.

Overall, positive performance in 2008 relative to competing funds was
due to our focus  on companies with  more defensive business  models,
visible earnings and  strong balance  sheets.  The  ongoing theme  of
sector consolidation also  provided some  upside, with  two of  IEM's
holdings acquired by large multinationals.  The main contributors  to
weak performance  were typically  companies  with high  debt  levels,
requirements for new project debt or to refinancing existing debt, or
exposure to falling commodity prices.

Drivers of Environmental Markets in 2008

Many of the long term drivers of Environmental Markets have developed
positively during 2008, with political leaders continuing to  support
the sector, and in a number of cases, using spending on environmental
infrastructure as a stimulus  for the global economy.   Nevertheless,
in the  shorter term  and along  with  the rest  of the  market,  the
environmental sector has faced a number of difficulties as  financial
markets have collapsed.

The  main  challenges  that  have  affected  the  sector  have   been
macroeconomic weakness, falling oil and commodity prices and lack  of
credit availability.   This  affects  a number  of  sectors  such  as
renewable energy and metals recycling.  Notwithstanding this, for the
short term, the diversity of the investment universe has allowed  the
Company to focus on sectors with greater earnings visibility such  as
hazardous waste and filtration, which have been less exposed to these
issues.  Over the medium term, we  expect all the above issues to  be
addressed.  Over the longer term, we were encouraged in November 2008
to see the International Energy  Agency raise its forecast oil  price
to US$ 200 by 2030.

In last  year's annual  report,  we highlighted  the emergence  of  a
"mini-bubble" in the solar  power market which had  led to very  high
valuations.  During 2008,  the share  prices of  all solar  companies
fell significantly as it emerged  that demand growth was slowing  and
that margins were falling  due to overcapacity  in the industry.   As
detailed later  in this  report, we  have started  to buy  shares  in
selected solar companies where we now see attractive valuations and a
strong long term technological competitive advantage.

Development of Companies and Markets by Sub-Sector

Alternative Energy and Energy Efficiency
Legislative support for the alternative energy and energy  efficiency
sub-sector saw continued positive momentum in 2008.  The election  of
Barack Obama signalled a sea-change in US environmental policy,  with
proposals for  aggressive  medium-term  goals  for  10  per  cent  of
electricity generation from renewables by 2012 (compared to less than
4 per cent in 2007)  and implementation of a cap-and-trade  programme
to reduce  greenhouse  gas  emissions  80 per  cent  by  2050.   More
imminently the US economic stimulus bill includes ca. US$ 63bn direct
spend  and  tax   incentives  for  alternative   energy  and   energy
efficiency.  Developments in Europe were  also positive, with the  EU
formally adopting a Climate and Energy Package to target 20 per  cent
of energy from renewables by 2020, to reduce greenhouse gas emissions
by 20 per cent by 2020 (relative  to a 1990 baseline), and to  extend
the EU  Emissions Trading  Scheme into  a third  phase beyond  2012.
These legislative  targets  will  underpin the  growth  prospects  of
portfolio companies in the medium term.

In the  second half  of 2008,  a collapse  in the  price of  oil  and
subsequently  global  power   prices,  together   with  the   reduced
availability of credit, had a negative impact on the renewable energy
sector.  Many  companies have  scaled back  their forecasts  for  the
coming year, and although the medium-term outlook is positive, in the
near-term there  is great  uncertainty.  Our  concerns regarding  the
solar sector at the end of 2007  appear to be playing out going  into
2009. An  oversupply  situation  is widely  recognised,  and  average
selling prices  have  fallen,  impacting  company  profitability  and
growth prospects.  As discussed above, we have exploited share  price
weakness  to  add  holdings  in  companies  with  strong  long   term
competitive advantages.

Energy efficiency markets  remained positive  over the  year, with  a
further raft  of European  standards  for energy  efficient  products
announced.  In the  US a  significant proportion  of the  forthcoming
stimulus bill will be directed towards energy efficiency in buildings
and  on  improving  the  efficiency  of  the  power  grid.   Although
construction markets remain weak, a growing number of governments are
implementing building standards for  energy efficiency and  subsidies
for insulation that bode well for these environmental markets in  the
long-term.

Key contributors  to  performance  included  Fuel  Systems  Solutions
(natural gas  engines,  US),  which  became  the  focus  of  investor
attention during the  period of  high oil prices  and Xantrex  (solar
inverter  technology,  Canada),  which  was  acquired  by   Schneider
Electric.   Conversely,  renewable  energy  companies  suffered   for
reasons described  above  and  equipment  manufacturers  and  project
developers were  both hit,  with Gamesa  (wind turbines,  Spain)  and
Canadian  Hydro  Developers  (renewable  project  developer,  Canada)
particularly weak.

Water Treatment and Pollution Control
Water scarcity  issues continued  to preoccupy  governments over  the
year. In the UK, the government announced plans for a review of water
charging that  could lead  to  compulsory meters  in areas  of  water
stress by 2030.  In Australia  the government's plans for  recovering
from the worst drought on record included investing AU$ 12bn over ten
years on improving water productivity and efficiency of use.

The familiar theme of investment requirements in water infrastructure
continued to gain global attention.  In China, 9 per cent of a fiscal
stimulus package totalling RMB 4trn  will focus on the  environmental
sector including urban  sewage and water  treatment projects. The  US
stimulus package includes ca. US$ 18bn spend on water infrastructure,
a sector  that has  been consistently  under-funded in  past  years.
Although this commitment will take some time to translate into actual
projects, we  are confident  that  several portfolio  companies  will
benefit.

In pollution  control,  the  European Parliament  and  Member  States
agreed a deal to cut carbon  dioxide emissions from cars.  The  final
compromise gave  manufacturers an  extra two  years to  meet  targets
compared to proposals  made in  2007.  Nevertheless, a  target of  an
average of 120g of carbon dioxide  per km for each manufacturer  will
be  phased  in  from  2012,  via  a  combination  of  vehicle   motor
technology, technical improvements and the use of alternative fuels.
In China, the Beijing Olympics focused attention on pollution  issues
in the country. Several measures to curb air pollution were put  into
effect over  the  period, and  have  been continued  following  their
success.

At the stock level, defensive  business models allowed Kurita  (water
treatment, Japan) and Clarcor (pollution control, US) to outperform.
In addition,  consolidation continued  in  the sector,  with  Whatman
(separations technology, UK) acquired by General Electric in  April.
Exposure to the  ailing automotive sector  caused weakness in  Horiba
(testing and measuring, Japan), and  falling commodity prices led  to
declines in Bioteq (pollution control, Canada).

Waste Technologies and Resource Management
The legislative drivers  continued to  tighten in  the waste  sector,
with environment ministers from the EU Member States approving a  new
Waste Framework Directive that sets the first ever EU-wide  recycling
targets.  By 2020, all EU countries must recycle 50 per cent of their
household waste and 70 per cent of construction and demolition waste.
In the US, the Recycling Investment Saves Energy Act was signed  into
law, providing tax breaks for  business to buy recycling  equipment.
This should  lead to  significant investment  over the  medium  term,
which will  benefit  portfolio  holdings  such  as  Tomra  (recycling
technology, Norway).

Falling commodity prices were another key feature of 2008, driven  by
slowing growth in emerging markets and  recession in the rest of  the
world.  This had an adverse  impact on metal recyclers Metalico  (US)
and  Sims  Group  (Australia).    Highly  leveraged  companies   that
outperformed  in  2007   such  as   Transpacific  Industries   (waste
management, Australia) had  a difficult year,  due to concerns  about
these companies' ability to refinance and service debt.

Strong  performers  in  the  portfolio  were  Clean  Harbors   (waste
management, US)  and  Covanta (waste-to-energy,  US)  reflecting  the
relatively defensive  nature  of  their  businesses  in  an  economic
downturn.  China Everbright (water and waste project developer,  Hong
Kong) also performed well due to new project announcements and strong
outlook for infrastructure investment  in China under this  country's
US$585bn stimulus package.

Portfolio Activity and Current Structure

The Company started  the year  with 87 listed  companies. Since  that
time we have sold out  of 7 companies and we  have invested in 8  new
companies. As a  result the  Company was invested  in a  total of  88
listed companies on 31 December 2008.

IEM continues to  favour profitable companies,  which represented  93
per  cent  of  the  portfolio  at  year  end,  flat  on  last  year.
Alternative energy & energy efficiency ended the year at 42 per  cent
of the total portfolio, water treatment & pollution control at 25 per
cent and waste  technologies &  resource management at  33 per  cent.
There were no material changes in the sub sector weightings.

In terms of company size, 8 per cent of the portfolio is invested  in
micro caps with a market capital of  less than £100m, 48 per cent  in
companies between £100m and £1bn and  39 per cent in companies  above
£1bn, which is an increase of 9 per cent reflecting the bias  towards
larger more liquid, less volatile  companies in the aftermath of  the
financial crisis. The balance of 5 per cent is in unquoted companies,
discussed below.  Taking advantage of the drop in valuations of Asian
equities, and following  good progress  by our  research resource  in
Hong Kong,  the portfolio  weighting invested  in the  Rest of  World
increased 4 per cent  to 14 per  cent. The remaining  44 per cent  is
invested in North America and 42 per cent in Europe.

Unquoted Companies

IEM's activity in  unquoted companies  has been  extended during  the
year with 2 new additions to the portfolio, both in the wind  turbine
sector.  Emergya Wind  Technologies ("EWT",  Netherlands) and  Nordic
Windpower (US).  We also completed  4 follow-on investments in  Ensyn
(biomass pyrolysis, UK), Sterecycle (waste technology, UK), New Earth
Solutions (waste technology, UK) and EWT.

Acknowledging the severity  of the market  declines in  environmental
markets stocks, particularly in  the second half  of 2008, we  marked
down the value of holdings in  4 unquoted companies.  The net  impact
of the valuation  adjustments is  that the  total unquoted  companies
portfolio was held  at £16.0   m at the  year end, being  7 per  cent
below cost price.

The Company ended the year with a portfolio of 7 unquoted  companies,
representing approximately 5 per cent of the IEM portfolio.

Following the  year end,  and reflecting  continued deterioration  in
market conditions,  we  have marked  down  further the  values  of  2
unquoted investments  since  the  year end  resulting  in  a  further
aggregate downward  NAV reduction  of £4.3m.   Given the  challenging
environment, we continue to focus resources on the existing  unquoted
portfolio,  whilst  selectively  reviewing  new  opportunities   with
compelling fundamentals and low valuations.


Outlook for 2009

Despite the ongoing recession affecting  a number of markets, we  are
optimistic about the prospects  for the Company,  which we expect  to
benefit  from  several  positive  developments  in  2009,   including
infrastructure spending and  further environmental legislation.   New
policy in the United States should provide a significant catalyst  to
performance, and  many  holdings  stand to  benefit  from  government
stimulus packages.

The portfolio continues to emphasize companies in the more  defensive
environmental markets  such as  hazardous waste,  filtration and  the
power generation/IPP  sectors  while  we are  preparing  to  increase
exposure to  selected early-cycle,  inexpensive companies.   We  also
anticipate an easing of credit conditions later in the year, and will
look for value in companies that will be the principal  beneficiaries
of this development.

At the end of  January (being the date  of the most recent  available
data), the IEM  portfolio was  trading on 12x  the average  portfolio
earnings over the next twelve months which is a substantial  discount
to the historical  range.  While  we recognise  that the  6 per  cent
forecast earnings growth for  the portfolio over  the next 12  months
may be  revised  down further,  and  that short  term  volatility  is
likely, we  remain  positive  on  the long  term  prospects  for  the
Company.

We will continue to  post monthly updates on  sector news and on  the
Company's performance on www.impax.co.uk.

Impax Asset Management Ltd.
17 March 2009



STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the annual report and the
financial  statements   in  accordance   with  applicable   law   and
regulations.

Company law  requires  the Directors  to  prepare accounts  for  each
financial year. Under that law, the Directors have elected to prepare
the financial statements in accordance with United Kingdom  Generally
Accepted Accounting Practice (United Kingdom Accounting Standards and
applicable law). The financial statements are required by law to give
a true and fair view of the state of affairs of the Company as at the
end of the year and  of the total return  for the year. In  preparing
those accounts, the Directors are required to:

* select suitable accounting policies and then apply them
  consistently;

* make judgements and estimates that are reasonable and prudent; and

* state whether applicable accounting standards have been followed,
  subject to any material departures disclosed and explained in the
  accounts.

The Directors confirm that they comply with these requirements.

The Directors are responsible  for keeping proper accounting  records
which disclose with  reasonable accuracy  at any  time the  financial
position of the Company and enable  them to ensure that the  accounts
comply with the  Companies Act  1985. They are  also responsible  for
safeguarding  the  assets  of  the  Company  and  hence  for   taking
reasonable steps for the prevention and detection of fraud and  other
irregularities.

The accounts are published on  the www.impax.co.uk website, which  is
maintained by the Company's  Manager, Impax Asset Management  Limited
("IAM"). The maintenance and integrity  of the website maintained  by
IAM is, so far  as it relates to  the Company, the responsibility  of
IAM.  The  work  carried  out  by  the  auditors  does  not   involve
consideration of the maintenance and  integrity of this website  and,
accordingly, the auditors  accept no responsibility  for any  changes
that  have  occurred  to  the  accounts  since  they  were  initially
presented on the  website. The  accounts are  prepared in  accordance
with UK  legislation,  which may  differ  from legislation  in  other
jurisdictions.

Statement under the Disclosure & Transparency Rules 4.1.12
The Directors each confirm to the best of their knowledge that:
a) the accounts,  prepared in accordance  with applicable  accounting
standards, give  a true  and fair  view of  the assets,  liabilities,
financial position and profit or loss of the Company; and

b) this Annual Report includes a  fair review of the development  and
performance of  the   business  and  the  position  of  the  Company,
together with a description of the principal risks and  uncertainties
that it faces.

For and on behalf of the Board


Richard Bernays
Chairman
17 March 2009



PRINCIPAL RISKS AND UNCERTAINTIES

The Board considers that the risks faced by the Company fall into two
main categories.

i)                     External risks
Poor  performance  from  stock  markets  in  general  and/or  foreign
currency movements.  In addition, the specialist sectors in which the
Company invests tend to be more volatile than general, broadly  based
stock market indices.  As  a consequence shareholders may  experience
higher  variability  in  returns  than  investing  in  stock  markets
generally and, in particular, may experience higher levels of  losses
in the event of stock market falls.  The Company has a specific remit
and the Board is focussed on  the medium and longer term  performance
of the  Company and  does  not consider  that short  term  volatility
should  unduly  influence   the  Company's   investment  policy   and
management of risk.

ii)                   Internal risks
The main risk areas  are poor allocation of  the Company's assets  by
the Investment  Manager,  poor  governance  by  the  Board  and  poor
compliance or administration including  the loss of investment  trust
status.  These  factors  could  potentially  result  in  unacceptable
returns for shareholders.



INCOME STATEMENT
For the year ended 31 December 2008


                                                      2008                        2007
                                              Revenue Capital   Total     Revenue Capital Total
                                              £'000   £'000     £'000     £'000   £'000   £'000
Gains on
investments
Disposals of investments                         -     17,396    17,396      -    20,202  20,202
Investments held                                 -    (109,485) (109,485)    -    25,200  25,200
Total gains/(losses) on investments              -    (92,089)  (92,089)     -    45,402  45,402
Income                                         4,878      -       4,878    2,933     -     2,933
Investment management fee                      (824)   (2,473)   (3,297)   (735)  (2,206) (2,941)
VAT recovered on investment management fees
                                                86       257       343       -       -       -

Other expenses                                 (818)      -       (818)    (855)     -     (855)
Return on ordinary activities before           3,322  (94,305)  (90,983)   1,343  43,196  44,539
taxation
Taxation                                       (665)     273      (392)    (184)     -     (184)
Return on ordinary activities after            2,657  (94,032)  (91,375)   1,159  43,196  44,355
taxation

Return per ordinary share - undiluted          0.88p  (30.99)p  (30.11)p   0.49p  18.39p  18.88p
Return per ordinary share - diluted            0.88p  (30.99)p  (30.11)p   0.49p  18.05p  18.54p



The total column is the profit and loss account of the Company.

All revenue  and capital  items in  the above  statement derive  from
continuing operations.  No operations  were acquired or  discontinued
during the year.

A Statement  of  Total  Recognised  Gains and  Losses  has  not  been
presented as  all  gains and  losses  are recognised  in  the  Income
Statement.




BALANCE SHEET
At 31 December 2008


                                                   2008          2007

                                                  £'000         £'000

FIXED ASSETS
Investments at fair value through profit        294,468       381,703
and loss

CURRENT ASSETS
Income receivable                                   261           101
Sales - future settlements                          385         1,799
Taxation recoverable                                  9            17
Other debtors                                       377            90
Cash at bank and in hand                         10,374        12,476
                                                 11,406        14,483

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE
YEAR
Purchases - future settlements                    (278)       (2,329)
Accrued liabilities                               (666)       (1,145)
                                                  (944)       (3,474)


NET CURRENT ASSETS                               10,462        11,009


TOTAL NET ASSETS                                304,930       392,712

CAPITAL AND RESERVES: EQUITY

Share capital                                    30,541        30,125
Share premium account                           246,110       242,024
Share purchase reserve                           44,125        44,125
Capital reserve                                (18,806)        75,226
Revenue reserve                                   2,960         1,212
SHAREHOLDERS' FUNDS                             304,930       392,712

Net assets per Ordinary Share - undiluted        99.84p       130.36p

Net assets per Ordinary Share - diluted          99.62p       128.25p

Number of ordinary shares in issue          305,405,220   301,246,052





RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS


For the year ended 31 December 2008



                             Share    Share
                    Share  Premium Purchase  Capital Revenue
                  Capital  Account  Reserve  Reserve Reserve    Total
                    £'000    £'000    £'000    £'000   £'000    £'000

  Opening
  shareholders'    30,125  242,024   44,125   75,226   1,212  392,712
  funds as at 1
  January 2008
  Shares issued
  during the year     350    3,584        -        -       -    3,934
  Exercise of          66      567        -        -       -      633
  warrants
  Share issue           -     (65)        -        -       -     (65)
  expenses
  Dividend paid         -        -        -        -   (909)    (909)
  (May 2008)
  Profit for the        -        -        - (94,032)   2,657 (91,375)
  year
  Closing          30,541  246,110   44,125 (18,806)   2,960  304,930
  shareholders'
  funds
  as at 31
  December 2008



For the year ended 31 December 2007



                               Share    Share
                      Share  Premium Purchase Capital Revenue
                    Capital  Account  Reserve Reserve Reserve   Total
                      £'000    £'000    £'000   £'000   £'000   £'000

  Opening
  shareholders'      20,036  127,796   44,125  32,030     454 224,441
  funds as at 1
  January 2007
  Shares issued
  during the year    10,084  116,251        -       -       - 126,335
  Exercise of             5       44        -       -       -      49
  warrants
  Share issue                (2,067)        -       -       - (2,067)
  expenses
  Dividend paid           -        -        -       -   (401)   (401)
  (May 2007)
  Profit for the          -        -        -  43,196   1,159  44,355
  year
  Closing            30,125  242,024   44,125  75,226   1,212 392,712
  shareholders'
  funds
  as at 31 December
  2007





CASH FLOW STATEMENT
For the year ended 31 December 2008




                                                     2008        2007
                                                    £'000       £'000

OPERATING ACTIVITIES

Cash inflow from investment income and bank         4,781       2,892
interest
Cash outflow from management expenses             (4,599)     (3,164)
Cash inflow from disposal of investments           95,199     166,084
Cash outflow from purchase of investments       (100,868)   (281,091)
Cash inflow/ (outflow) from foreign exchange          177        (43)
costs
Cash outflow from taxation                          (385)       (184)
NET CASH FLOW FROM OPERATING ACTIVITIES           (5,695)   (115,506)

EQUITY DIVIDENDS PAID                               (909)       (401)

FINANCING
Proceeds of share issues                            4,567     126,384
Expenses of share issues                             (65)     (2,067)
NET CASH INFLOW FROM FINANCING                      4,502     124,317


(DECREASE)/ INCREASE IN CASH                      (2,102)       8,410


                                                     2008        2007
                                                    £'000       £'000
Opening balance                                    12,476       4,066
Cash  (outflow) / inflow                          (2,102)       8,410
Balance at 31 December 2008                        10,374      12,476





NOTES
1. The accounts have been  prepared in accordance with applicable  UK
accounting standards and policies.

The accounts are  prepared in accordance  with UK Generally  Accepted
Accounting  Practice  ("GAAP")  and  the  Statement  of   Recommended
Practice  "Financial  Statements   of  investment  trust   companies"
("SORP")  issued  by  the  Association  of  Investment  Companies  in
December 2005.

2. Returns per ordinary share
Undiluted return  per share  is based  on the  net loss  on  ordinary
activities after taxation of £91,375,000 comprising a revenue  return
of £2,657,000 and  a capital loss  of £94,032,000 (2007:  £44,355,000
gain, comprising a revenue return of £1,159,000 and a capital  return
of £43,196,000) attributable to  the weighted average of  303,459,331
(2007: 234,933,122)  Ordinary  Shares of  100p  in issue  during  the
year.   The weighted average in the year ended 31 December 2007 takes
account of the C share issue and warrant conversion during the year.

There was  no dilution  to return  per  share in  the year  ended  31
December 2008.  Diluted  return per  share during the  year ended  31
December 2007 was based on the net gain on ordinary activities  after
taxation of £44,355,000 attributable to the diluted weighted  average
of 239,827,904 Ordinary Shares in issue during the year.

3. Net asset value per ordinary share
Undiluted net assets  per Ordinary Share  is based on  net assets  of
£304,930,000  (2007:  £392,712,000)  divided  by  305,405,220  (2007:
301,246,052) Ordinary Shares in issue at the Balance Sheet date.

Diluted net  assets per  Ordinary Share  is based  on net  assets  of
£323,270,000  (2007:  £411,685,000)  divided  by  324,509,373  (2007:
321,009,373) diluted Ordinary  Shares in issue  at the Balance  Sheet
date. The diluted figures are  based on all warrants being  converted
in to Ordinary Shares at a price £0.96 per share.

4. Dividend
The directors propose that the Company will pay a final dividend  for
the year ended  31 December  2008 of  0.85p per  Ordinary Share.   If
approved at the Annual General Meeting  the dividend will be paid  on
18 May 2009 to shareholders on the register at the close of  business
on 17 April 2009.

5. Related party transactions
Fees payable to the  Manager are shown in  the Income Statement;  the
relevant amount outstanding  as an  accrual at 31  December 2008  was
£243,167 (2007: £304,501).

6. Financial information
The financial  information for  2008 is  derived from  the  statutory
accounts for  2008,  which will  be  delivered to  the  registrar  of
companies  following  the  company's  Annual  General  Meeting.   The
statutory accounts for 2007 have  been delivered to the registrar  of
companies.  The auditors have reported on the 2007 and 2008 accounts;
their reports were unqualified and did not include a statement  under
Section 237(2) or (3) of the Companies Act 1985.

The Annual Report for the year ended 31 December 2008 was approved on
17 March 2009.  It  will be posted to  shareholders and will be  made
available on the Manager's website at www.impax.co.uk

This announcement contains regulated information under the Disclosure
Rules and Transparency Rules of the FSA.

7. The Annual General Meeting  will be held on  11 May 2009 at  11.00
a.m. at 145-157 St. John Street, London, EC1V 4RU.


17 March 2009

Secretary and registered office:
Cavendish Administration Limited
145-157 St John Street
London
EC1V 4RU

Tel: [phone]
                                                                                                                                                announcement.