Performance at month end

IMPAX ENVIRONMENTAL MARKETS plc

All information is at 28 February 2005 and unaudited

DATA AND PERFORMANCE


Data                            Pricing & Performance
                                                  IEM    MSCI  Impax
                                                  Net   World   ET50
Share Price                                      Asset
(pence)                    70.5                  Value
Total Fund Size       GBP 38.76 Pence (28.02.05) 77.51   n/a    n/a
(m)
Market                GBP 35.25 Premium/discount  -9%
Capitalisation (m)
Management fee             1.0%
Established         22 February      Performance
                           2002
Fund structure       Investment      1 month (%) +1.6%  +0.9%  +0.5%
                          Trust
Number of stocks             64     3 Months (%) +9.2%  +4.4%  +8.4%
held
Exchange                 London       1 year (%)  +14%  +5.7%  +3.4%
Currency                    GBP       2 year (%) +49.1% +30.9% +34.6%
ISIN Number        GB0031232498 Year to date (%) +1.3%  +0.3%  +0.9%
Sedol                   3123249
Reuters RIC Code          IEM.L
Bloomberg Code           IEM LN


TOP TEN HOLDINGS


Company             Holding %   Description                Country
Itron                     3.6   Meters & software          US
RPS Group                 3.5   Environmental consulting   UK
Casella Waste             3.2   Waste disposal & recycling US
Kurita Water              3.1   Water treatment            Japan
Vestas Wind Systems       2.6   Wind                       Denmark
BWT                       2.5   Water treatment            Austria
Quantum Fuel              2.4   Fuelcells & hydrogen       US
Zenon Environmental       2.4   Membranes                  Canada
Abengoa                   2.1   Biofuels & recycling       Spain
Tetra Tech                2.0   Environmental consulting   US

              Total      27.4


PORTFOLIO ANALYSIS*


Geographical            Company Size
North America      51%  >£500m         21%
Europe             40%  £100-500m      56%
Rest of the World   9%  <£100m         23%

Sectoral                Profitability
Energy             36%  Profitable     87%
Water              31%  Pre-Profitable 13%
Waste              31%
Cash                2%
* of funds invested as of 28 February 2005











MANAGER'S COMMENTARY (February 2005)


The company NAV was up +1.6% over the month compared to the MSCI
World, which rose +0.9%, and the Impax ET50, which increased +0.5%
over the same period.  Energy stocks were once again the strongest
performing sector as oil prices rose, with Brent crude touching US$50
per bbl.

The wider fundamentals supporting the alternative energy sector
strengthened during the month.  Firstly, the Kyoto Protocol entered
into force on 16 February.  Although not a signatory, the US agreed
to cooperate with Germany in the development of less polluting
technology and joint action to make energy producers more efficient.
In addition, following President Bush's speech in January urging
Congress to pass the long-delayed Energy Bill, and his pledge for
"strong funding for leading-edge technology", the fiscal 2006 Budget
saw an increase in the Department of Energy's Fuel Cell and Hydrogen
programs, and an initiative to support the development of crystalline
silicon PV technology.  In other areas, private equity firm Kelso &
Co made an offer for Insurance Auto Auctions Inc. in the US auto
recycling/salvage sector, which has a similar business model to
Universal Salvage in the UK.

In the US, the strongest performers during the month included Itron
(meters & utilities software), which rose 17.3% on signs that utility
spending in the US is strengthening and ongoing integration of the
Schlumberger metering business.  Fuel Cell Energy increased by 18.4%
after announcing a joint venture with Alliance Power to supply clean
energy to the Starwood Hotels & Resorts.  In Japan, Horiba
(environmental testing & monitoring) rose 19.5% on the back of better
than expected results and an improved earnings outlook. The best
performer in UK was Straight plc (recycling containers, UK), which
rose 27% following the completion of the acquisition of its main
competitor.  On the downside, Tomra (reverse vending machines,
Norway) fell 25.7% on disappointing sales and a poor outlook for
2005, while Stericycle (medical waste recycling, US) was down 11.9%
on concern about competition after Waste Management International
announced that it intended to expand recycling operations into
clinical waste.

During the month, we have increased our exposure to Pentair (water
treatment, US), Active Power (flywheels, US) and Xantrex (power
electronics, Canada) and taken profits in Horiba, Straight plc and
Itron.


Latest information available at: www.impax.co.uk/asset/iemdown.htm

9 March 2005


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