(Alliance News) - Impax Environmental Markets PLC on Monday said it outperformed both of its benchmarks in 2019 as a number of its portfolio holdings recovered in the year.
Impax Environmental is a trust investing in small to mid cap companies deriving at least 50% of their revenue from environmentally friendly goods and services. In 2019, its net asset value total return per share was 31%. This compares to a 22% return from the MSCI AC World Index and a 29% return from the FTSE ET100 Index.
"A significant contribution to the company's performance was the recovery of a number of portfolio holdings following an aggressive de-rating in the fourth quarter of 2018," explained Impax Asset Management Ltd, Impax Environmental's investment manager.
For example, environmental consulting firm Arcadis and power network efficiency company Itron were both weak in 2018 as a consequence of balance shee and outlook concerns. But, in 2019, both produces strong earnings and cashflow, as well as paying down debt, resulting in share price improvements.
Net asset value per share as at December 31 increased to 321.8 pence from 249.6p at the same point the year before.
In March, the company announced it would be paying a 3.0 pence per share interim dividend for 2019, the same level as its 2018 dividend.
"It remains the board's policy to pay out substantially all earnings by way of dividend, but shareholders will note that there is a significant gap between our reported earnings per share (3.63p) and the interim dividend paid (3.0p); this is a consequence of the continued expansion of our capital base," Impax Environmental explained.
On the subject of Covid-19, Chair John Scott said: "This is a time when strong nerves are needed and indeed they may be required for some time, but from every crisis some winners emerge. Your company may well be one of them; we have little gearing (4.99% as at the date of this report) and we invest in many sectors which will be long term beneficiaries of the likely reappraisal of the way in which governments, businesses and consumers prioritise expenditure and manage resources."
Shares in Impax Environmental closed down 1.4% at 275.00 pence in London on Monday.
By Anna Farley; annafarley@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.
Impax Asset Management (IEM)