Performance at month end

MPAX ENVIRONMENTAL MARKETS plc

All information is at 31 August 2008 (unless otherwise stated) and
unaudited.

DATA AND PERFORMANCE


  Data                                Pricing and Performance
                                                           IEM  MSCI
                                                           Net  World
                                                          Asset
  Share price (pence)           122.9                     Value
  Warrants (pence)           GBP 33.3
  Total fund size (m)       GBP 393.9 Diluted NAV (pence) 127.7  n/a
  Market capitalisation     GBP 373.4    Premium/discount -3.7
(m)                                                   (%)
  Management fee (%)              1.0       Undiluted NAV 129.6
                                                  (pence)
  Established             22 February        Performance*
                                 2002
  Fund structure           Investment         1 month (%) +6.3  +6.9
                                Trust
  Number of holdings               90        3 months (%) -2.5  -4.5
  (including unlisted)
  Exchange                     London          1 year (%) +4.7  -4.8
  Currency                        GBP         3 years (%) +43.6 +11.0
  ISIN number            GB0031232498         5 years (%) +99.9 +28.8
  Sedol                       3123249
  Reuters RIC code              IEM.L * Performance data is for
                                      undiluted NAV.
  Bloomberg code               IEM LN


TOP TEN HOLDINGS


Company        Holding %   Description                     Country
Clean Harbors        2.8   Hazardous waste                 US
Itron                2.7   Meters and utility software     US
Ormat                2.6   Geothermal                      Israel/US
Chloride Group       2.5   UPS                             UK
Vestas               2.5   Wind                            Denmark
Pall Corp            2.3   Filtration                      US
Gamesa               2.3   Wind                            Spain
Regal Beloit         2.2   High efficiency electric motors US
Novozymes            2.2   Industrial enzymes              Denmark
Pentair              2.1   Water treatment                 US
TOTAL               24.2


PORTFOLIO ANALYSIS*



  Geographical           Company Size
  US and Canada      42% >$2bn        33%
  EU and EFTA        44% $200-2bn     57%
  Rest of the World  10% <$200m       6%
  Cash               4%  Cash         4%

  Sectoral               PE ratios
  Energy             39% PER >20x     34%
  Water              25% PER  15-20x  21%
  Waste              32% PER <15x     38%
Cash                 4%  Unprofitable 3%
                         Cash         4%
* of funds invested as of 31 August  2008

IMPAX ENVIRONMENTAL MARKETS plc

MANAGER'S COMMENTARY (August 2008)


The Company NAV increased by 6.3% over the month compared with the
MSCI World which increased by 6.9%.

During the  month US  presidential candidates  elected their  running
mates dominating news in the Alternative Energy and Energy Efficiency
sector. Obama chose Joe Biden, Senator for Delaware who is supportive
of  a  federal  Renewable   Portfolio  Standard,  cap-and-trade   and
stringent fuel economy standards for vehicles. Obama also pledged  to
invest US$150  billion  over the  next  decade in  renewable  energy.
McCain chose Sarah Palin, Governor of Alaska putting a state that  is
vulnerable to  the  effects  of  climate  change  into  the  national
spotlight. Rare positive news for the biofuels sector came as the  US
EPA denied a request  to cut the  Renewable Fuel (ethanol)  Standard,
determining  that  the  evidence  did  not  support  a  finding  that
implementation would harm the economy of a state, region, or the  US,
contrary to the claims of the Governor of Texas who called for a  50%
reduction of the mandate.  In Japan, the  Ministry of Economy,  Trade
and Industry is seeking US$1.2 billion in 2009, a 50% hike from 2008,
to speed up alternative energy use.

In Water  Treatment  and  Pollution Control,  new  EU  rules  setting
tighter emission limits  for particulate matter  from cars and  light
commercial vehicles came into force. The Chinese government announced
a rise in  sales tax on  large vehicles, and  a reduction on  smaller
ones to curb  fuel consumption  and control emissions.  In Japan  the
government is looking  to introduce incentives  for consumers  buying
clean diesel cars starting next fiscal year. Drought continued to hit
Cyprus, and  plans were  announced  to build  a water  pipeline  from
Turkey to ease the  critical water shortage. Bids  start in 2009  and
construction could be launched in the same year, costing an estimated
US$400-450 million.

In Waste Technologies and Resource Management, China approved a draft
law on the management of electronic waste. The proposed regulation on
the recycling  and treatment  of used  electronic products  and  home
appliances received  approval from  the State  Council. In  Portugal,
plans were  announced  for  a  centralised  electronic  platform  for
trading non-hazardous waste. The market should be self-financing  and
compatible with integrated waste management models.

During the  month,  selected Energy  Efficiency  companies  performed
well, most  notably Kingspan  (insulation materials,  Ireland)  which
rose 24.8% on results that exceeded expectations, and on strong  cost
control that  outweighed  raw  material  price  increases.  In  Water
Treatment and Pollution Control, Mueller Water (water infrastructure,
US) rose 18.6% with results beating consensus and guidance raised  on
improving outlook. In the Waste Technologies and Resource  Management
sector, Séché Environnement  (waste treatment, France)  was up  11.7%
following results showing that  H1 profits nearly doubled,  exceeding
expectations. On the downside Epistar (LEDs, Taiwan) disappointed  on
higher operating  and RandD  costs, narrowly  missing consensus,  but
giving a brighter outlook on pricing for H2. Lee and Man Paper (paper
recycling, China) disappointed due  to uncertainty on Chinese  market
growth rates.




Latest information available at:


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

15 September 2008

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