Performance at month end

IMPAX ENVIRONMENTAL MARKETS plc

All information is at 30 June 2008 (unless otherwise stated) and
unaudited.

DATA AND PERFORMANCE


Data                             Pricing & Performance
                                                   IEM   MSCI   FTSE
                                                   Net   World  ET50
                                                  Asset
Share price (pence)        126.0                  Value
Warrants (pence)        GBP 40.8
Total fund size (m)    GBP 381.1      Diluted NAV 123.7   n/a   n/a
                                          (pence)
Market                 GBP 382.9 Premium/discount  1.9
capitalisation (m)                            (%)
Management fee (%)           1.0    Undiluted NAV 125.4
                                          (pence)
Established          22 February     Performance*
                            2002
Fund structure        Investment      1 month (%)  -6.2  -8.7   -7.5
                           Trust
Number of holdings            95     3 months (%)  +3.3  -2.6   +4.0
(including
unlisted)
Exchange                  London       1 year (%)  -3.7  -11.8 +11.9
Currency                     GBP      3 years (%) +52.4  +9.9  +95.8
ISIN number         GB0031232498      5 years (%) +122.0 +33.5 +155.1
Sedol                    3123249     Since launch +27.0  +6.5  +54.2
                                 (22/02/2002) (%)
Reuters RIC code           IEM.L
                                 * Performance data is for undiluted
Bloomberg code            IEM LN NAV.


TOP TEN HOLDINGS


Company        Holding %   Description                     Country
Chloride Group       2.7   UPS systems                     UK
Clean Harbors        2.4   Hazardous waste                 US
Ormat                2.4   Geothermal                      Israel/US
Itron                2.4   Meters & utility software       US
Vestas               2.3   Wind                            Denmark
Sims Group Ltd       2.2   Metals recycling                Australia
Gamesa               2.2   Wind                            Spain
Pall Corp            2.2   Filtration                      US
Regal Beloit         2.1   High efficiency electric motors US
Polypore             1.9   Filtration & separation         US
TOTAL               22.8


PORTFOLIO ANALYSIS*


Geographical          Company Size
USA & Canada      42% >$2bn        29%
EU & EFTA         46% $200-2bn     65%
Rest of the World 12% <$200m       6%

Sectoral              PE ratios
Energy            42% PER >20x     40%
Water             26% PER  15-20x  24%
Waste             32% PER <15x     32%
                      Unprofitable 4%
* of funds invested as of 30 June 2008


MANAGER'S COMMENTARY (June 2008)


During June the oil price reached a new high of $139 per barrel. The
Company NAV decreased by 6.2% over the month compared with the MSCI
World which decreased by 8.7%, and the FTSE ET50 which decreased by
7.5% over the same period.

In Alternative Energy & Energy Efficiency, Japan announced plans to
launch an experimental carbon trading scheme and pledged to cut
greenhouse gas emissions by 60-80% by 2050. Prime Minister Fukoda
said Japan would need to raise the portion of its energy needs met
through alternative sources such as solar and wind power, and ensure
that half of all new cars ran on 'next generation' fuels by 2020.
China's central bank also drew up a tentative outline for a domestic
emissions trading scheme. Germany's government approved major
legislative proposals to drive energy efficiency and renewables. 25%
of Germany's goal of 40% carbon emission reduction between 1990 and
2020 is expected to be met through the measures. The central element
of the plan is to double electricity generated by combined heat and
power technology (CHP) to 25%, and increase the share of renewable
electricity to 20%, in part by subsidising off-shore wind farm
development.

In Water Treatment & Pollution Control, Germany and France agreed to
a European Commission goal of cutting average CO2 emissions for new
cars, with a 'phasing-in' period for broader fleets. This signifies
an important break-through in achieving a target of 120g/km of
average CO2 emissions from 2012.

In Waste Technologies & Resource Management, the European parliament
finalised a significant revision of EU waste management rules. The
agreement adopted the first ever general EU recycling target (50% of
household waste, and 70% of building and demolition waste by 2020),
and confirmed a clear five-step hierarchy of waste management options
under EU law, from prevention to reuse, recycling, recovery and
disposal. Waste-to-energy incinerators will be reclassified as
recovery facilities, provided they meet certain efficiency standards.

In Alternative Energy & Energy Efficiency, natural gas engine stocks
out-performed. Fuel Systems Solutions (US) and Westport Innovations
(Canada) were up 38% and 16% respectively. Both companies are
benefiting from the widened spread between gasoline and gas prices.
Ceres Power (fuel cell boilers, UK) was up 29% following a positive
update on the contract with British Gas. In Water Treatment &
Pollution Control, Camco (carbon credit originator, UK) rose 33% on
news of a high profile investor's position in the stock, and an
acquisition. In Waste Technologies & Resource Management metals
recyclers Metalico (US) and Sims Group continued to benefit from
strong commodity prices, up 10% and 8% respectively. LKQ Corp (used
auto parts, US) fell 18% following downgrades due to demand
uncertainty, and Clarcor (filtration products, US) disappointed
following second quarter results below expectations.


Latest information available at:


http://www.impax.co.uk/impax/funds/listed_funds/environmental_plc/

15 July 2008

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