Performance at month end

RNS Number : 5925N

Impax Environmental Markets PLC

14 June 2010

 



IMPAX ENVIRONMENTAL MARKETS plc

All information is at 31 May 2010 (unless otherwise stated) and unaudited.

DATA AND PERFORMANCE

Pricing
Diluted NAV (pence)	126.03
Undiluted NAV (pence)	127.87
Share price (pence)	114.15
Premium/(discount) (%)	(10.73)
Warrants (pence)	18.00
Data
Total fund size (NAV) ( m)		388.9
Market capitalisation (m)		347.1
Management fee (%)		1.0
Established		22nd February 2002
Fund structure		Investment Trust
Number of holdings (including unlisted)		95
Exchange		London
Currency		GBP
ISIN Number		GB0031232498
Sedol		3123249
Reuters RIC code		IMPX.L
Bloomberg code		IEM LN

Performance	IEM Net Asset Value*	MSCI World Global Small Cap**
1 month %	-7.0	-4.9
3 months %	+0.7	+6.2
1 year %	+24.3	+43.2
3 year %	-0.1	+5.6
5 year %	+67.6	+49.9

* Performance data is for undiluted NAV ex income

** Total return

TOP TEN HOLDINGS

Company	Holding %		Description	Country
Itron	2.5		Automated meter reading	US
Clean Harbors	2.5		Hazardous waste	US
LKQ	2.4		Value added waste processing	US
Ormat	2.2		Geothermal	Israel/US
Horiba	2.2		Environmental testing & gas sensing	Japan
Chloride Group	2.1		Power network efficiency	UK
Pall Corp	2.1		Water treatment equipment	US
Stericycle	2.0		Hazardous waste management	US
Regal-Beloit	1.9		Industrial energy efficiency	US
CLARCOR	1.9		Pollution control solutions	US
TOTAL	21.8

PORTFOLIO ANALYSIS*

Geographical		Company Size
US and Canada	38%	>$2bn	20%
EU and EFTA	39%	$200-2bn	64%
Rest of the World	19%	<$200m	12%
Cash	4%	Cash	4%
Sectoral		PE ratios
Energy	45%	PER >20x	34%
Water	22%	PER  15-20x	34%
Waste	29%	PER <15x	20%
Cash	4%	Unprofitable	8%
		Cash	4%
* of funds invested as of 31 May 2010

IMPAX ENVIRONMENTAL MARKETS plc

MANAGER'S COMMENTARY (May 2010)

During the month the Company NAV fell by 7.0% compared to the MSCI World Small Cap which lost 4.9%. Amid ongoing macro uncertainty in parts of Europe, companies exposed to the PIIGS region underperformed. In Alternative Energy & Energy Efficiency, Abengoa (biofuels, Spain), Telvent (utility software, US) which has large Spanish exposure, and EDP Renovaveis (renewable IPP, Portugal) suffered. Dialight (energy efficiency lighting, UK) was strong, up 12% following good interim results, and the announcement of an acquisition. In Water & Pollution Control, the volatility of Asian markets impacted upon the Fund: China Everbright (water infrastructure, Hong Kong) suffered, as did Japanese stocks Horiba and Kurita Water (water treatment). Outperformers were companies with good results during the period, for example Polypore (filtration, US) which rose 15%. In Waste Technologies & Resource Management, outperformance came from Clean Harbors on expectations that the company will gain clean-up contracts following the oil spill in the Gulf of Mexico, with the stock laying flat for the month. Similar performance came from Stericycle following good quarterly results. In renewable energy news, the German Parliament passed proposals to cut feed-in-tariffs for solar installations by 16% for rooftop installations, and by 15% for non-farmland, non-conversion site ground installations. The cuts are likely to take place from July 1, and have been expected to enter into law for some months. In Italy, the new incentive scheme for solar power should be approved by the end of May. The reduction in incentives will be around 20%, in line with the recent reduction in costs for solar modules. In energy efficiency news in the US, the House of Representatives passed a bill containing the 'cash for caulkers' programme which would provide over USD 6bn in rebates to homeowners that perform certain energy efficiency retrofits. The Senate is expected to take a vote on the bill later this summer. In the UK, the general election resulted in a coalition government between the Conservatives and the Liberal Democrats. Key policies for the environmental sector include: introduction of a floor price for carbon; establishing a Green Investment Bank; and introduction of a new system of feed-in-tariffs for renewables. In China, the government announced the raising of retail power tariff premiums applicable to inefficient operators of heavy power consuming industries. The purpose is to accelerate industry consolidation, helping energy saving. In water news, a bipartisan bill proposed in the US Senate would remove caps on bond levels for infrastructure projects. According to the US EPA there is an investment gap of more than $500bn for necessary infrastructure upgrades over the next 20 years to ensure safe drinking water and wastewater treatment. In Japan, around 38,000km of water pipes have exceeded their stipulated service life of 40 years, a survey by the Japan Water Works Association found. In pollution control, the EPA issued proposals on industrial boilers and solid waste incinerators that it said will cut mercury emissions in the US by more than half and significantly reduce other pollutants. In waste news, the US EPA announced plans to regulate coal ash waste from power plants without designating how it would do so. The agency will now take formal public comment for 90 days but gave no timetable for a decision.  In China, the government may extend a car replacement programme for those trading in a vehicle that is 8 years or older for a purchase of a new, more efficient car.  Also in China, the government plans to establish 30 demonstration bases within 5 years to promote the recycling of scrap metals. The central and local governments will support the construction of the demonstration bases.

Latest information available at: http://www.impax.co.uk/impax/funds/listed_funds/environmental_plc/

Impax Asset Management Limited

14 June 2010

 

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