Performance at month end

RNS Number : 4372P

Impax Environmental Markets PLC

15 July 2010

 



IMPAX ENVIRONMENTAL MARKETS plc

All information is at 30 June 2010 (unless otherwise stated) and unaudited.

DATA AND PERFORMANCE

Pricing
NAV (pence)	120.83
Share price (pence)	112.00
Premium/(discount) (%)	(7.31)
Data
Total fund size (NAV) ( m)		390.1
Market capitalisation (m)		361.4
Management fee (%)		1.0
Established		22nd February 2002
Fund structure		Investment Trust
Number of holdings (including unlisted)		91
Exchange		London
Currency		GBP
ISIN Number		GB0031232498
Sedol		3123249
Reuters RIC code		IMPX.L
Bloomberg code		IEM LN

Performance	IEM Net Asset Value*	MSCI World Global Small Cap**
1 month %	-5.4	-7.4
3 months %	-9.3	-9.0
1 year %	+17.9	+33.6
3 year %	-6.5	-0.1
5 year %	+47.8	+32.5

* Performance data is for undiluted NAV ex income

** Total return

TOP TEN HOLDINGS

Company	Holding %		Description	Country
Chloride Group	2.6		Power network efficiency	UK
LKQ	2.5		Value added waste processing	US
Pall Corp	2.4		Water treatment equipment	US
Clean Harbors	2.4		Hazardous waste	US
Itron	2.3		Automated meter reading	US
Ormat	2.1		Geothermal	Israel/US
Horiba	2.1		Environmental testing & gas sensing	Japan
China Everbright	2.0		Value added waste processing	China
Vacon	1.8		Industrial energy efficiency	Finland
CLARCOR	1.8		Pollution control solutions	US
TOTAL	22.0

PORTFOLIO ANALYSIS*

Geographical		Company Size
US and Canada	37%	>$2bn	15%
EU and EFTA	37%	$200-2bn	66%
Rest of the World	18%	<$200m	11%
Cash	8%	Cash	8%
Sectoral		PE ratios
Energy	43%	PER >20x	28%
Water	22%	PER  15-20x	31%
Waste	27%	PER <15x	25%
Cash	8%	Unprofitable	8%
		Cash	8%
* of funds invested as of 30 June 2010

IMPAX ENVIRONMENTAL MARKETS plc

MANAGER'S COMMENTARY (June 2010)

During the month the Company NAV fell 5.4% compared to the MSCI World Small Cap which lost 7.4%. In Alternative Energy & Energy Efficiency, M&A activity was a positive contributor to the Fund's performance over the month. Chloride (uninterruptible power supplies, UK) was subject to a bidding war between Emerson and ABB. Other relative outperformers were Taewoong (wind components, South Korea) and EDP Renovaveis (wind developer, Portugal), both recovering after poor performance in May. In Europe, wind turbine manufacturers Vestas (Denmark), and Gamesa (Spain), plus wind gearbox supplier Hansen Transmissions (Belgium) were weak on fears over wind tariff reductions in Europe. Kingspan (buildings energy efficiency, Ireland) was weak on concerns that European economic weakness could slow the housing market recovery. In Water & Pollution Control, Badger Meter (automated meter reading, US) outperformed following strong Q1 numbers. Nalco (water treatment chemicals, US) underperformed following concerns about the toxicity of their water dispersant chemical used in the Gulf of Mexico to disperse oil from the BP spill. The EPA since confirmed that the chemical does not pose a problem. In Waste Technologies & Resource Management, Clean Harbors (hazardous waste management, US) continued to outperform given the growing potential earnings from processing waste generated by the gulf oil spill. In addition, Stericyle (hazardous medical waste processing, US) was strong following a broker upgrade. Weak performance came from Sims (metals recycling, Australia) over concerns about a slowing Chinese economy reducing demand for raw materials. In renewable energy news, the Spanish Government announced proposals to cut feed-in tariffs paid to most existing solar parks by 30% and reduce payments to future projects by up to 45%. Following lobbying by banks with EUR 15 billion in loans to the industry the government may not cut premiums paid for renewable energy at existing plants. The Spanish government is expected to sign a deal with the wind sector involving a cap on the number of hours eligible for subsidised prices at existing projects; 1st July was the target date for ultimate settlement of the new tariff structure however this has been delayed. In Italy plans were announced to cut incentives for solar power producers by an average of 18 percent in 2011; this is down from the cuts of 25% announced in May. The Romanian Parliament has passed a new law to promote renewable power, with increased support for wind and solar projects. Solar projects will qualify for six green certificates per each MWh, instead of four at the moment. The UK's Conservative-Liberal Democrat coalition government has confirmed that over £72.4m of support for wind projects announced under Labour will go ahead. The UK government has also brought forward legislation to establish a Green Investment Bank by Autumn.  In Asia, China is planning to install 5GW of offshore wind capacity by 2015 and expects to reach 30GW of capacity by 2020. India is to add about 30GW of renewable energy capacity in the next five years to meet its target of generating 10% of its electricity from renewable energy by 2015 and has announced a floor price of INR 12,000 (USD 257) per MWh for solar and INR 1,500 (USD 32) per MWh for non-solar renewable energy certificates. The Japanese government has contributed JPY 360m (USD 4.01m) to promote the use of energy efficiency and renewable power generation in the Asia Pacific region. In the US the Deepwater Horizon disaster resulted in the Obama administration ordering a six-month moratorium on offshore drilling. Although this disaster has pushed forward hope for a clean energy bill Obama's speech from the Oval office on June 16th offered little in the way of a solid clean energy movement with a price on carbon being the only recurring suggested legislation. The introduction of the Electric Drive Vehicle Deployment Act of 2010 has been announced. The legislation will provide incentives to consumers to purchase electric vehicles and grants to selected communities to demonstrate widespread deployment of electric vehicles. The pilot for a subsidy on private purchases of new energy cars was also launched in China.

Latest information available at: http://www.impax.co.uk/impax/funds/listed_funds/environmental_plc/

Impax Asset Management Limited

15 July 2010

 

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