Performance at month end

IMPAX ENVIRONMENTAL MARKETS plc

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

DATA AND PERFORMANCE


  Data                                 Pricing and Performance
                                                          IEM   MSCI
                                                          Net   World
                                                         Asset  Small
  Share price (pence)            110.1                   Value  Cap*
  Warrants (pence)            GBP 25.5
  Total fund size (m)      GBP 357.3      Diluted NAV    115.96  n/a
                                            (pence)
  Market capitalisation      GBP 335.7  Premium/discount -6.04
(m)                                                  (%)
  Management fee (%)               1.0     Undiluted NAV 117.18
                                                 (pence)
  Established              22 February     Performance**
                                  2002
  Fund structure            Investment       1 month (%)  -4.8  -6.4
                                 Trust
  Number of holdings                89      3 months (%)  +7.7  +9.7
  (including unlisted)
  Exchange                      London        1 year (%) +32.3  +28.9
  Currency                         GBP       3 years (%) +12.3  -2.5
  ISIN number             GB0031232498       5 years (%) +65.3  +36.4
  Sedol                        3123249
  Reuters RIC code              IMPX.L * Performance data is in Total
                                       Return.
                                       ** Performance data is for
                                       undiluted NAV.
  Bloomberg code                IEM LN






















TOP TEN HOLDINGS


Company               Holding %   Description               Country
China Everbright            2.6   Water infrastructure      Hong Kong
Itron                       2.3   Automated meter reading   US
Transpacific                      Waste management &
Industries                  2.3   recycling                 Australia
Nibe                        2.2   Ground source heat pumps  Sweden
Ormat                       2.2   Geothermal                US
                                  Industrial energy
Telvent                     2.1   efficiency                US
Clean Harbors               2.1   Hazardous waste           US
Pentair                     2.0   Water treatment           US
LKQ Corp                    1.9   Automotive recycling      US
Abengoa                     1.9   Biofuels                  Spain
TOTAL                      21.6



PORTFOLIO ANALYSIS*



  Geographical           Company Size
  US and Canada      36% >$2bn        14%
  EU and EFTA        47% $200-2bn     72%
  Rest of the World  16% <$200m       13%
  Cash               1%  Cash         1%

  Sectoral               PE ratios
  Energy             47% PER >20x     34%
  Water              21% PER  15-20x  32%
  Waste              31% PER <15x     27%
Cash                 1%  Unprofitable 6%
                         Cash         1%
* of funds invested as of 31 October 2009



IMPAX ENVIRONMENTAL MARKETS plc

MANAGER'S COMMENTARY (October 2009)


During the month the Company NAV decreased by 4.8% compared to the
MSCI World Small Cap which decreased by 6.4%.

In climate change policy news, EU member states offered to slash GHG
emissions by up to 95% by 2050, and reconfirmed a commitment to
target 30% reductions by 2020 if a climate change pact is sealed in
Copenhagen in December. Ministers also agreed that the aviation
industry should cut emissions by 10% by 2020 compared with 2005
levels, and shipping by 20%. In the US, the Senate Environment
Committee released an updated draft of legislation to limit GHG
emissions. The new version includes some concessions to critics of
the original, plus details on spending programmes. It remains likely
that the bill will move through the Senate in early 2010, to be
reconciled with the existing House of Representatives' bill later in
the year. In energy efficiency news, the US DoE has awarded $3.4bn in
stimulus funding to companies, utilities, manufacturers, and others
to implement various smart grid technologies. In pollution control,
Japan's new government announced it may back away from its pledge to
end a gasoline surcharge. This policy has been at odds with the new
government's bold environmental pledges to date and it appears that
the administration has realised this. The US EPA announced a complete
overhaul of legislation regulating toxic chemicals, describing the
current law as an "inadequate tool" to protect people and the
environment against chemical risks. The move echoes Europe's REACH
regulation, adopted in 2006.

In Alternative Energy & Energy Efficiency, small-cap holdings
performed strongly over the month, Active Power (flywheels, US) was
up 35%, and Dialight (LEDs, UK) rose 19%. Nibe (heat pumps, Sweden)
continued to perform well on positive news of subsidies in Europe, up
13%. In Water & Pollution Control, small-caps again benefited, Bioteq
(water treatment, Canada) rose 27%. In Waste Technologies & Resource
Management, stocks recovering from previous underperformance were,
Stericycle (hazardous waste, US) and Tomra (recycling equipment,
Norway) up 8% and 7% respectively. Daiseki (hazardous waste
management, Japan) rose 2% over the period, as the stock began to
recover from a historically low valuation. Wind-related stocks were
weak on concerns over 2010 outlook; Gamesa (Spain) and EDP Renovaveis
(Portugal) both suffered. Solar stocks were also weak on regulatory
uncertainty in Germany - this impacted Sunpower (US). Underperformers
also included Sims Metal Management (scrap metal recycling,
Australia), which disappointed the market by lowering prices to
increase volumes, and reported lower than expected margins, down 11%.




Latest information available at:


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

13 November 2009

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