Performance at month end

IMPAX ENVIRONMENTAL MARKETS plc

All information is at 28 February 2006 and unaudited

DATA AND PERFORMANCE


Data                         Pricing & Performance
                                                  IEM    MSCI  Impax
                                                  Net   World   ET50
Share Price                                      Asset
(pence)                112.8                     Value
Total Fund Size    GBP 128.5   Pence (28.02.06) 106.6*   n/a    n/a
(m)
Market             GBP 135.9   Premium/discount  +5.7
Capitalisation
(m)
Management fee          1.0%
Established      22 February        Performance
                        2002
Fund structure    Investment        1 month (%)  +4.2    +1.2   +3.9
                       Trust
Number of                 72       3 Months (%)  +17.5   +5.1  +24.7
stocks held
Exchange              London         1 year (%)  +37.6  +22.4  +46.2
Currency                 GBP         3 year (%) +119.2  +56.4  +101.6
ISIN Number     GB0031232498   Year to date (%)  +15.2   +2.1  +19.7
Sedol                3123249
Reuters RIC            IEM.L * To comply with the new guidelines
Code                         issued by the AITC, portfolio valuation
                             moved to bid from mid price with effect
Bloomberg Code        IEM LN from 31 December 2005.


TOP TEN HOLDINGS


Company        Holding %   Description                     Country
Itron                3.1   Meters & software               US
LKQ                  2.7   Automotive recycling            US
Kurita Water         2.5   Water treatment                 Japan
Esco Tech            2.4   Filtration & meters             US
Regal Beloit         2.4   High efficiency electric motors US
Canadian Hydro       2.3   Renewable energy IPP            Canada
Stericycle           2.3   Clinical waste                  US
Gamesa               2.3   Wind                            Spain
RPS Group            2.2   Environmental consulting        UK
Pall Corp            2.2   Filtration                      US

Total               24.3


PORTFOLIO ANALYSIS*


Geographical            Company Size
North America      50%  >£500m         43%
Europe             43%  £100-500m      43%
Rest of the World   7%  <£100m         14%

Sectoral                Profitability
Energy             41%  Profitable     88%
Water              28%  Pre-Profitable 12%
Waste              30%
Cash                1%
* of funds invested as of 28 February 2006














MANAGER'S COMMENTARY (February 2006)


The Company NAV  was up 4.2%  over the month  compared with the  MSCI
World, which gained 1.2% and the Impax ET50, which rose 3.9% over the
same period.  It  was interesting to note  that this performance  was
decoupled from  the energy-related  sectors, which  were the  weakest
performers after their strength in January.  Telecoms, utilities  and
healthcare were the best performing sectors.

During the month Norwegian  firm Havgul AS  applied for a  concession
for the world's biggest wind  power development, with total  capacity
of 1,500 megawatts (MW).  The offshore project could be in  operation
in 2010 or 2011, and would represent a quarter of the record 6,183 MW
of wind  turbines installed  in Europe  last year.   In  the US,  the
American Wind Energy Association has  forecast more than 3,000 MW  in
installed capacity for 2006, ahead  of the record 2,431 MW  installed
in 2005.  In the water sector,  China announced plans to step up  the
construction of water  supply projects,  with priority  given to  the
treatment of affected water  supply in rural  areas which contains  a
high content  of fluorine,  arsenic and  other pollutants.   US$  2.4
billion has  been spent  providing clean  drinking water  to some  60
million rural people  over the past  five years, and  China aims  for
this to be extended to a further 300 million people by 2020.  In  the
waste sector, the US senate passed Senate Bill 6428, which calls  for
a  safe  and  environmentally   sound  system  for  the   collection,
transportation, and recycling of electronic products.  The bill  will
now go to the  House of Representatives.   In the UK, two  pioneering
waste treatment plants are being considered by the East London  Waste
Authority as a  way to  reduce landfill  disposal.   These include  a
gasification plant  to  deal  with  up  to  90,000  tonnes  of  solid
recovered  fuel,  possibly  from  the  Shanks  mechanical  biological
treatment  plant  located  nearby,   and  a  high-temperature   steam
technology to  process up  to 160,000  tonnes of  waste each  year.
Finally, at the corporate level, Germany's SolarWorld bought  Shell's
solar manufacturing operations  for an  undisclosed sum.   Shell  has
said that it  intends to  focus its solar  activities on  non-silicon
technologies,  including  thin-film  Copper  Indium  DiSelenide,  and
believes that the global shortage of silicon and resulting high price
will make  thin-films more  competitive.   CEO  Jeroen van  der  Veer
remains committed to the sector, and said the company aims to develop
at least one of its  alternative energy interests into a  substantial
business.

The main contributors to performance were Abengoa (waste disposal &
recycling, Spain), which gained 31% on positive sentiment towards the
biofuels sector, Itron (meters and utility data, US), which rose 24%
following strong quarterly results, and Turbo Genset (distributed
power generation, Canada), which increased by 19% after announcing a
contract.  On the downside, Kurita (water treatment & desalination,
Japan) fell 9% on broker downgrades, and Hydrogenics (hydrocarbon
technologies, Canada) declined by 8% following an impressive
performance in January.

During the month  we increased  our exposure  to Energy  Developments
(landfill  gas  development,  Australia)  and  Kingspan   (insulation
products, Ireland), and took profits in Q-Cells (solar, Germany).


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

13 March 2006




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