Performance at Month End

IMPAX ENVIRONMENTAL MARKETS plc

All information is at 31 January 2009 (unless otherwise stated) and
unaudited.

DATA AND PERFORMANCE


  Data                                 Pricing and Performance
                                                          IEM   MSCI
                                                          Net   World
                                                         Asset  Small
  Share price (pence)             92.1                   Value  Cap*
  Warrants (pence)            GBP 21.5
  Total fund size (m)        GBP 289.2       Diluted NAV  94.7   n/a
                                                 (pence)
  Market capitalisation      GBP 281.4  Premium/discount  -2.7
(m)                                                  (%)
  Management fee (%)               1.0     Undiluted NAV  94.7
                                                 (pence)
  Established              22 February     Performance**
                                  2002
  Fund structure            Investment       1 month (%)  -4.2  -6.9
                                 Trust
  Number of holdings                92      3 months (%)  +6.9  +0.2
  (including unlisted)
  Exchange                      London        1 year (%) -17.0  -19.4
  Currency                         GBP       3 years (%)  -7.5  -26.5
  ISIN number             GB0031232498       5 years (%) +39.3  +12.2
  Sedol                        3123249
  Reuters RIC code               IEM.L * Performance data is in Total
                                       Return.
                                       ** Performance data is for
                                       undiluted NAV.
  Bloomberg code                IEM LN


TOP TEN HOLDINGS


Company       Holding %   Description                     Country
Regal Beloit        2.8   High efficiency electric motors US
Itron               2.8   Meters & utility software       US
Ormat               2.8   Geothermal                      Israel/US
Pall Corp           2.6   Filtration                      US
Clean Harbors       2.4   Hazardous waste                 US
Pentair             2.3   Water treatment                 US
Novozymes           2.3   Recycled auto parts             US
Mayr-Melnhof        2.2   Cartonboard                     Austria
Kurita              2.2   Water treatment & desalination  Japan
LKQ Corp            2.2   Industrial enzymes              Denmark

TOTAL              24.6



PORTFOLIO ANALYSIS*



  Geographical           Company Size
  US and Canada      41% >$2bn        23%
  EU and EFTA        42% $200-2bn     64%
  Rest of the World  14% <$200m       10%
  Cash               3%  Cash         3%

  Sectoral               PE ratios
  Energy             42% PER >20x     10%
  Water              24% PER  15-20x  27%
  Waste              31% PER <15x     58%
Cash                 3%  Unprofitable 2%
                         Cash         3%
* of funds invested as of 31 January 2009

IMPAX ENVIRONMENTAL MARKETS plc

MANAGER'S COMMENTARY (January 2009)


During January the Company NAV decreased by -4.2% compared to the
MSCI World Small Cap which decreased by 6.9%.

Following the inauguration of President Obama in mid-January, details
of the planned $800bn+ economic stimulus began to emerge. Around
$54bn in direct spend on renewable energy and energy efficiency
programmes is expected in the coming years, which includes smart grid
infrastructure, buildings energy efficiency, and water infrastructure
upgrades. Several tax incentives are also likely to be included in
the final version due by mid-February. These include: a 3 year
extension of the PTC for wind, geothermal and biomass, and attempts
to alleviate wind project financing problems in the US through tax
credit modifications. Obama also announced he was instructing the EPA
to 'reconsider' a previous ruling that blocked California from
imposing emissions limits on light vehicles. It now seems clear that
this will get the go-ahead and that California will be followed by 13
other states. In Japan, the government announced its own 'green'
stimulus plans, pledging to create up to 1m new jobs in the
environmental sector. In the Water Treatment & Pollution Control
sector EU negotiators reached a compromise on a controversial
pesticides package, introducing rules that will force farmers and
chemical producers to replace 22 highly toxic products over the next
decade. Meanwhile China announced it is to embark on a controversial
water-diversion scheme to deliver water to nearly half a million
people in drought-prone areas of the southwest. The scheme is
expected to cost around $907m.

In the Alternative Energy & Energy Efficiency sector, developers with
North American exposure performed well, in part due to continued
anticipation of a boost from Obama's economic stimulus package. For
example, wind developers EDP Renovaveis (Portugal) and Canadian Hydro
(Canada) were up 16% and 14% respectively. Nibe (efficient heat
pumps, Sweden) rose 13% as underlying strength in the heat pump and
boiler markets continued to improve. Novozymes (biofuel enzymes,
Denmark) performed strongly during the month following a full year
results announcement which contained long term guidance that
surprised the market; the stock rose 12%. In the Water Treatment &
Pollution Control sector, Horiba (testing and measurement, Japan)
performed well, up 16% following news of anticipated auto emissions
reduction legislation in the US. Dionex (testing and measuring, US)
rose 13% following strong Q4 results. In the Waste Technologies &
Resource Management sector, Metalico (metal recycling, US) rose 58%
following a recovery in lead prices. Solar stocks Sunpower (US) and
PV Crystalox (UK) disappointed following continued negative news
suggesting oversupply for 2009. Transpacific Industries (waste
management, Australia) suffered due to negative perceptions of high
levels of debt in the current economic environment.








Latest information available at:


http://www.impax.co.uk/impax/funds/listed_funds/environmental_plc/

16 February 2009

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