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Impax Asian Env Mkt (IAEM)

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Wednesday 21 April, 2010

Impax Asian Env Mkt

Interim Management Statement

RNS Number : 5859K
Impax Asian Environmental Mkts Plc
21 April 2010

Impax Asian Environmental Markets Plc (the 'Company')

Interim Management Statement

For the three months ended 31 March 2010


This interim management statement covers the period from the 1 January 2010 to 31 March 2010 (the "Period"), and is prepared in accordance with the UK Listing Authority's Disclosure and Transparency Rule 4.3.


Summary investment objective and policy


The Company's investment objective is to generate long term capital growth from rapid and sustained growth anticipated by the Directors in the markets for cleaner or more efficient delivery of basic services such as energy, water and waste in certain countries in the Asia Pacific Region. These countries are predominantly China, Hong Kong, Taiwan, Japan, South Korea, India, Australia, New Zealand, Singapore, Malaysia, the Philippines and Thailand.


The investment policy is to invest in quoted companies that conduct their business in the Asia Pacific Region and that provide, supply, utilise, implement or advise upon technology-based systems, products or services in the Asia Pacific Region, particularly those of water treatment and pollution control, waste technology and resource management, and utilise alternative and efficient energy sources.




During the Period, the Company's diluted Net Asset Value ("NAV") per Ordinary Share (excluding current year net revenue) rose by 6.9% from 106.5p to 113.9p. The Company's undiluted NAV per Ordinary Share (excluding current year net revenue) rose by 8.0% from 107.8p to 116.4p, performing in line with the MSCI AC Asia Pacific ex Japan Index which rose 7.9% during the period (priced in pounds sterling).


The Period was characterised by strength in the energy efficiency, renewable energy developer and waste management & technologies sectors and weakness in the wind power and solar equipment sectors. The Company slightly underperformed the FTSE Environmental Opportunities Asia ex Japan Index ("EOAX") which was up 8.9% during the Period as two large weight index stocks (not owned by the Company) performed strongly.


New share issues


During the Period, the Company's share price has generally traded at a premium to diluted NAV.  The Company issued 4,949,000 new Ordinary Shares in the Period and has for all practicable purposes fully utilised its ability to issue shares on a 'tap' basis pursuant to Prospectus Rule 1.2.3(1). Accordingly, any further issues of shares by the Company prior to December 2010 may only be carried out following the publication of a prospectus by the Company.


Portfolio activity


Impax Asset Management Limited (the "Manager") continues to focus on bottom-up stock picking.  Important activity during the Period has included the increase in weighting of selected Chinese solar holdings with strong long term growth potential and attractive valuations after a period of underperformance.  Profits were taken by the Company in the renewable energy developers sector (particularly in the Philippines) and certain recycling stocks which had outperformed. During the Period, the Company added five new holdings to its portfolio, participated in two fundraisings, including an IPO, and sold out of one position.


The five largest holdings as at 31 March 2010 are all Chinese companies listed in Hong Kong and are set out below.




Portfolio weighting

Xinyi Glass

Glass manufacturing


Xinao Gas

Gas distribution


Lee & Man Paper

Paper recycling


China Everbright

Waste-to-energy & water


China Longyuan Power

Wind power producer



The five largest holdings list illustrates the preference for a diversified sector portfolio, with all sectors (energy, water and waste) represented. The Company is overweight in Greater China compared to the EOAX due to the attractive bottom-up opportunities available in the region.




The Directors and the Manager remain positive on the outlook for the Company. In particular, the momentum of environmental policy and legislation in the Asia Pacific region remains strong and many environmental markets are set for strong growth.  Although the pace of global economic recovery remains uncertain, the Manager is confident that the secular growth characteristics of environmental markets and the acceleration of spending and investment in the Asian environmental markets will make an incremental contribution to performance.


The interim management statement will be made available on the Manager's website


21 April 2010

This information is provided by RNS
The company news service from the London Stock Exchange