Performance at month end

Impax Environmental Markets PLC
15 December 2004

IMPAX ENVIRONMENTAL MARKETS plc



All information is at 30 November 2004 and unaudited



DATA AND PERFORMANCE


Data                                      Pricing & Performance
Share Price (pence)                  70.5                         IEM            MSCI         Impax

                                                            Net Asset Value      World         ET50
Total Fund Size (m)                    37  Pence (30.11.04)       74.3            n/a          n/a
Management fee                       1.0%  Premium/discount      -5.1%
Established              22 February 2002
Fund structure           Investment Trust       Performance
Number of stocks                       61       1 month (%)      +4.9%           +0.7%        +3.3%
held
Exchange                           London      3 Months (%)      +12.6%          +3.0%        +6.9%
Currency                              GBP        1 year (%)      +12.6%          +3.9%        -3.1%
ISIN Number                  GB0031232498        2 year (%)       +26%          +10.1%        +5.9%
Sedol                             3123249  Year to date (%)      +12.1%          +1.9%        -0.9%
Reuters RIC Code                    IEM.L
Bloomberg Code                     IEM LN




TOP TEN HOLDINGS


Company                        Holding %      Description                  Country
Ionics                               4.0      Water treatment              US
RPS Group                            3.6      Environmental consulting     UK
Casella Waste                        3.6      Waste disposal & recycling   US
Itron                                3.4      Meters & software            US
BWT                                  3.1      Water treatment              Austria
Kurita Water                         2.7      Water treatment              Japan
Zenon Environmental                  2.7      Membranes                    Canada
Vestas Wind Systems                  2.7      Wind                         Denmark
CDS Tech                             2.6      Stormwater & wastewater      Australia
Shanks                               2.5      Integrated waste management  UK

                 Total              30.9



PORTFOLIO ANALYSIS*


Geographical                         Company Size
North America             51%        >£500m                  19%
Europe                    40%        £100-500m               60%
Rest of the World          9%        <£100m                  21%

Sectoral                             Profitability
Energy                    33%        Profitable              89%
Water                     34%        Pre-Profitable          11%
Waste                     31%
Cash                       2%
* of funds invested as of 30 November 2004




MANAGER'S COMMENTARY (November 2004)


The Company NAV was up +4.9% during the month compared with the MSCI World Index which increased +0.7% and the
Impax ET50, which increased +3.3%.  Currencies were volatile during the world and the US dollar weakened against
both sterling (-3.8%) and the euro (-3.6%) which had an adverse effect on the performance of IEM - the Company
currently holds 35% of assets in US$.  Specific developments in the Environmental Markets during the month are
discussed below.



It was as interesting month in the fuel cell and hydrogen sector as both listed companies in which General
Motors holds an equity stake announced acquisitions.  Hydrogenics (fuel cells & testing, Canada) has bid for
Stuart Energy (hydrogen electrolysis, Canada) to add a third leg to the company's integrated strategy - fuel
cell modules; fuel cell testing, and hydrogen generation and fueling.  The company has substantially increased
its revenue expectations and, thought it will remain loss-making, Hydrogenics has enough cash to finance the
business plan for the foreseeable future.  Meanwhile Quantum (fuel cells & hydrogen) has made an offer for
Starcraft (tier 1 automotive supplier, US) to create a 'one-stop-shop' for vehicle system design, powertrain
engineering, and second stage manufacturing/assembly for future alternative fuel and fuel cell vehicle programs.
  The new Quantum is expected to have revenues of over $200 million in the first year, to be profitable and
cashflow generative as well has maintaining $50 million of net cash on the balance sheet.   In the wind sector,
the news was mixed as both Gamesa (slightly) and Vestas (substantially) downgraded expectations for 2005 despite
news of several large orders from North America.  In the same sector, the UK engineering company FKI announced
that it would be exiting the wind sector and closing the small wind turbine manufacturer Dewind after
substantial losses.



The water treatment sector has been in the spotlight during the month as General Electric agreed to acquire
Ionics (water treatment & desalination, US) for $44 which was a 48% premium to the share price and on valuation
multiples for 2005 of 44X EPS and 12.4 EV/EBITDA.  This is the 6th Environmental Markets acquisition (see May
2004 factsheet) that GE has made in the last three years and reflects the growth potential of these markets.
The high valuation paid by GE led to a rise in other IEM holdings that are exposed to the water treatment
markets but trade on lower multiples to the price paid for Ionics - examples include BWT, Zenon Environmental,
Cuno (filtration, US), Calgon Carbon (activated carbon & UV disinfection, US) and Pall Corp (water treatment &
filtration, US).  Other companies announcing positive results during the month were Horiba (environmental
testing, Japan) and Esco Technologies (automated meter reading & filtration).



In the waste and resource management sector, Shanks (integrated waste management, UK) announced its first set of
results since the sale of its landfill assets earlier in the year and profitability improved in the main markets
of Belgium, Netherlands and UK.  Shanks also signed a 25 year contract with Dumfries & Galloway for the
treatment and disposal of circa 95,000 tonnes per year of municipal solid waste and will ensure compliance with
the requirements of the European Landfill Directive and the UK legislation for biodegradable municipal solid
waste (using Ecodeco technology).   Also in the UK, the Queen's Speech made reference to the Neighbourhood and
Environment Bill that will grant more powers to local authorities to enforce waste management standards and
tackle issues relating to abandoned vehicles.  The Bill is likely to lead to increased opportunities for private
companies in the waste sector and could benefit both PM Group (weighing devices, UK) and Universal Salvage
(vehicle auctions and recycling, UK).



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



15 December 2004


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