Performance at month end

Impax Environmental Markets PLC
08 September 2004

IMPAX ENVIRONMENTAL MARKETS plc



All information is at 31 August 2004 and unaudited



DATA AND PERFORMANCE


Data                                      Pricing & Performance

Share Price (pence)                    58                         IEM            MSCI         Impax
                                                            Net Asset Value      World         ET50
Total Fund Size (m)                  32.8  Pence (31.08.04)       65.7            n/a          n/a
Management fee                       1.0%  Premium/discount      -11.7%
Established              22 February 2002
Fund structure           Investment Trust       Performance
Number of stocks                       62       1 month (%)      -0.1%           +1.3%        -0.2%
held
Exchange                           London      3 Months (%)      -0.5%           +0.6%        -1.8%
Currency                              GBP        1 year (%)      +1.1%           -0.0%        -4.7%
ISIN Number                  GB0031232498  Year to date (%)      -0.9%           -1.1%        -5.6%
Sedol                             3123249
Reuters RIC Code                    IEM.L
Bloomberg Code                     IEM LN




TOP TEN HOLDINGS


Company                        Holding %      Description                  Country
Vestas Wind Systems                  4.0      Wind                         Denmark
RPS Group                            3.6      Environmental consulting     UK
Itron                                3.4      Meters & software            US
Casella Waste                        3.3      Waste disposal & recycling   US
Ionics                               3.3      Water treatment              US
Trojan Tech                          3.3      UV disinfection              Canada
Kurita Water                         2.9      Water treatment              Japan
Shanks                               2.9      Waste management             UK
Tetra Tech                           2.8      Environmental consulting     US
Zenon Environmental                  2.7      Membranes                    Canada

                 Total              32.2



PORTFOLIO ANALYSIS*


Geographical                         Company Size
North America             51%        >£500m                  19%
Europe                    40%        £100-500m               54%
Rest of the World          9%        <£100m                  27%

Sectoral                             Profitability
Energy                    31%        Profitable              89%
Water                     37%        Pre-Profitable          11%
Waste                     32%
Cash                       1%
* of funds invested as of 31 August 2004





MANAGER'S COMMENTARY (August 2004)


The Company NAV was flat (-0.1%) during the month compared with the MSCI World Index, which increased +1.3% and
the Impax ET50, which decreased -0.2%.  The equity market moved (inversely) with the oil price, which rose to an
all time high (Brent Crude $44.6 per bbl.) during the month before falling back to just above $40 per bbl.
Technology shares were again weak as were the Nasdaq-quoted alternative energy stocks in the Environmental
Markets universe; utilities were the strongest sector as investors tended to switch into more defensive
situations.  Specific developments in EM during the month are discussed below.



Vestas (wind, Denmark) reported results for the first time since the company acquired NEG Micon and, with the
exception of the United States, the report on the global wind market was positive, particularly in Australia,
India and the British Isles.  The principal uncertainty remains the timing of the implementation of the US
production tax credit for 2005 and beyond.  Progress with the integration of NEG Micon remains on track and
substantial cost savings are expected to be visible in the final results for 2004.  In the fuel cell and
hydrogen sector the newsflow was positive as Ballard (automotive fuel cells, Canada) announced a $3.6m follow-on
contract with an unnamed automaker, and FuelCell Energy (stationary fuel cells, US) reported a collaboration
with Kawasaki Heavy Industries to market its fuel cells in Japan.  Meanwhile, the results from companies in this
developing area continued to be lumpy with both Hydrogenics (fuel cells, Canada) and Quantum Fuel (hydrogen
systems, US) experiencing some delays in orders.  On the other hand, companies operating in more established
markets continued to report strong results including Canadian Hydro Developers (renewable energy utility,
Canada) and Vacon (frequency converters, Finland).



The water treatment and pollution control sub-sector was the strongest performer during the month.  The strong
pick up in capital and infrastructure spending meant that, without exception, the companies in the IEM portfolio
reported results that were in line with or ahead of expectations.  Insituform (trenchless sewer repair, US) and
Ionics (water treatment, US) both confirmed that their turnarounds were on track.  CDS Tech (water treatment &
stormwater management, Australia), Cuno (filtration, US) and Kurita all reported good results, while Esco Tech
(filtration & powerline meters, US) and BWT (water treatment, Austria) both beat expectations and upgraded
numbers for the rest of the year.  Strong government support combined with high energy and utility prices mean
that the outlook for companies in this sub-sector remains positive.



It was a quiet month in the waste technologies and resource management sub-sector as companies generally
reported results in line with expectations.  Energy Developments (landfill gas, Australia) announced that it had
resolved its ongoing dispute with Deutz (engines, Germany) following the underperformance of the latter's
product at various EdL sites.  Mayr Melnhof (cartonboard recycling, Austria) reported a strong rise in profits
and also that it would be able to pass rising energy costs onto customers, thereby demonstrating the market
power that this company has achieved in recent years.  The only disappointment came from Stantec (environmental
consulting, Canada) as it reported lower than expected earnings following the integration of its recent US
acquisition, however, the company did not change guidance for the rest of the year and reported buoyant markets
in North America.





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



08 September 2004


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