Condensed Consolidated Statement of
Comprehensive Income

For the six months ended 31 March 2024

All amounts in other comprehensive income may be reclassified to income in the future.

The statement has been prepared on the basis that all operations are continuing operations.

Condensed Consolidated Statement of Financial Position

For the six months ended 31 March 2024

Condensed Consolidated Statement of Changes in Equity

For the six months ended 31 March 2024

Condensed Consolidated Statement of Cash Flows

For the six months ended 31 March 2024

Notes to the Condensed Consolidated Interim
Financial Statements

For the six months ended 31 March 2024

1 Basis of preparation

This interim report is unaudited and does not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006. These condensed consolidated interim financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting' and the AIM rules. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 30 September 2023.

The comparative figures for the financial year ended 30 September 2023 are not the Company's statutory accounts for that financial year. Those accounts, prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006, have been reported on by the Company's auditors and delivered to Companies House. The report of the auditors was (i) unqualified, (ii) did not include a reference to matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under Section 498 (2) or (3) of the Companies Act 2006. Copies of these accounts are available upon request from the Company's registered office at 7th floor, 30 Panton St, London, SW1Y 4AJ or at the Company's website: www.impaxam.com.    

Going concern

The financial statements have been prepared on a going concern basis which the Directors consider to be appropriate for the following reasons. Cash flow forecasts covering a period of 12 months from the date of approval of these financial statements indicate that, taking account of reasonably possible downside assumptions in relation to asset flows, market performance and costs, the Group will have sufficient funds to meet its liabilities as they fall due and regulatory capital requirements for that period. The Group has sufficient cash balances and no debt and, based on Period-end AUM, is profitable. A significant part of the Group's cost basis is variable as bonuses are linked to profitability. The Group can also preserve cash through dividend reduction and through issuance of shares to cover share option exercises/restricted share awards (rather than purchasing shares). Consequently, the Directors are confident that the Group will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis.

Accounting policies

The accounting policies applied by the Group in these condensed consolidated interim financial statements are the same as those applied by the Group in its consolidated financial statements for the year ended 30 September 2023.

New and forthcoming accounting standards applicable to the Group

No new accounting standards or interpretations issued or not yet effective are expected to have an impact on the Group's condensed consolidated financial statements.

2 Estimates

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

The Group has not identified any significant judgements and estimates at the end of the reporting Period. However the key areas that include judgement and/or estimates are set out in note 10.

3 Adjusted profits and earnings

The reported operating earnings, profit before tax and earnings per share are substantially affected by business combination effects and other items. The Directors have therefore decided to report an adjusted operating profit, adjusted profit before tax and adjusted earnings per share which exclude these items in order to enable comparison with peers and provide consistent measures of performance over time. A reconciliation of the adjusted amounts to the IFRS reported amounts is shown below.

The adjusted diluted earnings per share is calculated using the adjusted profit after taxation shown above. The diluted number of shares is the same as used for the IFRS calculation of earnings per share (see note 8).

Similar adjustments have been made, where relevant, for the year ended 30 September 2023 to give adjusted operating profit of £58,103,000, adjusted profit before tax of £59,956,000 and adjusted diluted earnings per share of 35.2 pence.

Amortisation of intangibles

Management contracts, which are classified as intangible assets, were acquired as part of the acquisition of Pax World Management LLC (the "Acquisition"), subsequently referred to as 'Impax NH'. These management contracts are amortised over their 11 year life. This charge is not linked to the operating performance of the Impax NH business so is excluded from adjusted profit.

Acquisition equity incentive scheme charges

Impax NH staff have been awarded share-based payments in respect of the acquisition of Impax NH. Charges in respect of these relate to the acquisition rather than the operating performance of the Group and are therefore excluded from adjusted profit.

Mark to market charge on equity incentive awards

The Group has in prior years and the current period awarded employees options over the Group's shares, some of which are either unvested or unexercised at the balance sheet date. The Group has also made awards of restricted shares ("RSS awards") which have not vested at the balance sheet date. Employers' national insurance contributions ("NIC") are payable on the options when they are exercised and on the RSS awards when they vest, based on the valuation of the underlying shares at that point. A charge is accrued for the NIC within IFRS operating profit based on the share price at the balance sheet date. The Group also receive a corporation tax credit equal to the value of the awards at the date they are exercised (options) or vest (RSS awards). The tax credit in excess of the cumulative share-based payment expense is recognised directly in equity.

These two charges/credits vary based on the Group's share price (together referred to as mark to market charge on equity incentive schemes) and are not linked to the operating performance of the Group. They are therefore eliminated when reporting adjusted profit.

Finance income and expense

Finance expense for the Period has been adjusted for foreign exchange gains and losses on monetary assets that are not linked to the operating performance of the Group. £450,000 of the current Period foreign exchange loss relates to the retranslation of a US dollar denominated loan between the Parent Company and a US subsidiary with the remaining amount mainly relating to retranslation of cash and cash equivalents. A corresponding gain is recognised in equity in the exchange translation reserve.

4 Segment Information

The Group is managed on an integrated basis and there is one reportable segment. Segment information is presented on the same basis as that provided for internal reporting purposes to the Group's chief operating decision maker, the Chief Executive.

5 Finance income

6 Finance expense

Foreign exchange losses in the Period mainly arose on the retranslation of monetary assets held in US dollars. £450,000 of this loss relates to the retranslation of a US dollar denominated loan between the Parent Company and a US subsidiary. The remaining amount relates to the retranslation of cash and cash equivalents. A corresponding gain is recognised in equity in the exchange translation reserve.

7 Taxation

The tax rate for the Period is higher than the standard rate of corporation tax in the UK for the Period (25%). The differences are explained below:

8 Earnings per share

Basic earnings per share ("EPS") is calculated by dividing the profit for the year attributable to ordinary equity holders of the Parent Company (the "Earnings") by the weighted average number of ordinary shares outstanding during the year, less the weighted average number of own shares held. Own shares are held in Employee Benefit Trusts ("EBTs"). Diluted EPS includes an adjustment to reflect the dilutive impact of share awards.

The weighted average number of shares is calculated as shown in the table below.

9 Dividends

On 12 March 2024, at the Company's Annual General Meeting, payment of a 22.9 pence per share final dividend for the year ended 30 September 2023 (2022: 22.9 pence per share) was approved. Combined with an interim payment of 4.7 pence this gave total dividends for the year ended 30 September 2023 of 27.6 pence. The Trustee of the Impax Employee Benefit Trusts waived the Trusts' rights to part of the final dividend, leading to a total dividend payment of £30,132,057 which was paid on 22 March 2024.

The Board has declared an interim dividend for the Period of 4.7 pence per ordinary share (2023: 4.7 pence). This dividend will be paid on 19 July 2024 to ordinary shareholders on the register at close of business on 14 June 2024.

10 Goodwill and Intangible assets

The goodwill balance within the Group at 31 March 2024 arose from the acquisition of Impax Capital Limited on 18 June 2001 and the acquisition of Impax NH in January 2018.

Goodwill

There were no brought forward impairment losses at 1 October 2023 or impairment charges during the Period.

Intangible assets

The management contracts were acquired with the acquisition of Impax NH in January 2018 and are amortised over an 11-year life.

Assets under management, forecast asset inflows and operation margin are all the same or in excess of the assumptions when the management contracts were first valued. The discounted cost of capital is the same as when the management contracts were first valued. As such, there are no indicators of impairment.

11 Property, plant & equipment

Property plant and equipment

The carrying value of the Group's right of use assets, associated lease liabilities and the movements during the Period are set out below.

Lease arrangements

12 Current asset investments

The Group makes seed investments into its own Listed Equities funds and also invests in its Private Equity funds. Where the funds are consolidated the underlying investments are shown in the table below. Investments made in unconsolidated funds are also included.

An analysis of the investment by valuation technique hierarchy is disclosed below:

Level 1 means that valuation is made by reference to quoted prices in active markets for the relevant securities.

Level 2 assets do not have regular market pricing but can be given a fair value based on quoted prices in active markets.

Level 3 assets are those where there is no readily available market information to value them and the asset value are based on models. They represent investments in our private equity funds.

13 Cash reserves

Cash and cash equivalents under IFRS does not include cash invested in money market funds which is exposed to market variability. However the Group considers its total cash reserves to include these amounts. Cash held by consolidated funds is not considered to be available to the Group so it is not included in cash reserves. Cash held in Research Payment Accounts ("RPAs") is collected from funds managed by the Group and can only be used towards the cost of researching stocks. A liability of an equal amount is included in trade and other payables. This cash is excluded from cash reserves. A reconciliation is shown below:

14 Share capital and own shares

Own shares represents those held by the Impax Asset Management Group plc Employee Benefit Trust 2012 (the "EBT") which are typically used to fund exercise of options or awards of restricted shares. 1.6 million shares were purchased by the EBT in the six months ended 31 March 2024. The EBT transferred 1.2 million shares to option/restricted share holders on exercise of options or to holders of restricted shares when the restrictions lapsed.

As at 31 March 2024, there were a total of 2.6 million options outstanding over the Group's shares, of which 50,000 were exercisable. As at 31 March 2024, employees also held 3.3 million Restricted Shares over which the restrictions lapse from June 2024 through to January 2029. These Restricted Shares are held in the EBT and included in the own shares numbers shown above.

15 Related party transactions

Private equity funds managed by the Group, entities controlled by these funds and the Global Resource Optimization Fund LP and Impax Global Opportunities Fund LP are related parties of the Group by virtue of subsidiaries being the General Partners to these funds. The Group earns management fees from these entities.

BNP Paribas Asset Management Holdings is a related party of the Group by virtue of owning a 13.8% equity holding as well as having a representative on the Board of Directors. The Group sub-manages certain funds for BNP for which it earns fees.

Other funds managed by subsidiaries of the Group are also related parties by virtue of their management contracts.

Fees earned from the above related parties and amounts receivable are disclosed within this note below. During the Period, there were two existing loan facilities that were provided to an Executive Director for the sole purpose of investment in funds managed by the Group. The loans are provided at interest rates of 2.25% and 3.0% per annum on amounts drawn, calculated on a daily basis. Total interest of €2,111 was accrued during the Period and the total balance of the two loans at the Period end was €237,951 (2023: €292,194).

Revenue earned from and operating costs for related parties of the Group are as shown in the table below:

Investments in related parties of the Group and trade and other receivables due from related parties are as shown in the table below:

16 Reconciliation of net cashflow from operating activities

This note should be read in conjunction with the Condensed Consolidated Statement of Cash Flows. It provides a reconciliation of how profit before tax, which is based on accounting rules, translates to cashflows.

17 Group risks

The Group's principal risks remain as detailed within the Directors' Report of the Group's 2023 Strategic Report.

Independent Review Report to Impax Asset Management Group plc

CONCLUSION

We have been engaged by Impax Asset Management Group plc ("the Company") to review the condensed set of financial statements in the half-yearly report for the six months ended 31 March 2024 which comprises the Condensed Consolidated Income Statement and Condensed Consolidated Statement of Comprehensive Income, the Condensed Consolidated Statement of Financial Position, the Condensed Consolidated Statement of Changes in Equity, the Condensed Consolidated Statement of Cash Flows and the related explanatory notes.

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly report for the six months ended 31 March 2024 is not prepared, in all material respects, in accordance with IAS 34 Interim Financial Reporting as adopted for use in the UK and the AIM Rules.

BASIS FOR CONCLUSION

We conducted our review in accordance with International Standard on Review Engagements (UK) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity ("ISRE (UK) 2410") issued for use in the UK. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. We read the other information contained in the half-yearly report and consider whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

CONCLUSIONS RELATING TO GOING CONCERN

Based on our review procedures, which are less extensive than those performed in an audit as described in the Basis for conclusion section of this report, nothing has come to our attention that causes us to believe that the Directors have inappropriately adopted the going concern basis of accounting, or that the Directors have identified material uncertainties relating to going concern that have not been appropriately disclosed.

This conclusion is based on the review procedures performed in accordance with ISRE (UK) 2410. However, future events or conditions may cause the Group to cease to continue as a going concern, and the above conclusions are not a guarantee that the Group will continue in operation.

DIRECTORS' RESPONSIBILITIES

The half-yearly report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half-yearly report in accordance with the AIM Rules.

As disclosed in note 1 the latest annual financial statements of the Group were prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and the next annual financial statements will be prepared in accordance with UK-adopted international accounting standards. The Directors are responsible for preparing the condensed set of financial statements included in the half-yearly report in accordance with IAS 34 as adopted for use in the UK.

In preparing the condensed set of financial statements, the Directors are responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

OUR RESPONSIBILITY

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly report based on our review. Our conclusion, including our conclusions relating to going concern, are based on procedures that are less extensive than audit procedures, as described in the Basis
for conclusion section of this report.

THE PURPOSE OF OUR REVIEW WORK AND TO WHOM WE OWE OUR RESPONSIBILITIES

This report is made solely to the Company in accordance with the terms of our engagement. Our review has been undertaken so that we might state to the Company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company for our review work, for this report, or for the conclusions we have reached.

Alison Allen
for and on behalf of KPMG LLP

Chartered Accountants
15 Canada Square
London

28 May 2024

Alternative Performance Measures

The Group uses the following Alternative Performance Measures ("APMs").

ADJUSTED OPERATING PROFIT, ADJUSTED PROFIT BEFORE TAX AND ADJUSTED PROFIT AFTER TAX

These APMs exclude the impact of the following items:

·       amortisation of intangible assets which arose on the acquisition of Impax NH

·       charges in respect of equity incentive scheme related to the acquisition of Impax NH

·       mark-to-market credits and charges in respect of national insurance payable on share awards

·       foreign exchange gains and losses on the retranslation of monetary assets that are not linked to the operating performance of the Group

These performance measures are reported as they facilitate comparison with prior periods and provide an appropriate comparison with our peers. Excluding amortisation of intangible assets arising from acquisitions is consistent with peers and therefore aids comparability. It also aids comparison to businesses which have grown organically, and do not have such charges. Mark-to-market credits and charges in respect of national insurance are excluded as they arise due only to changes in the share price and therefore do not reflect the operating performance of the Group. Foreign exchange gains and losses on the retranslation of monetary assets are excluded as they are not linked to the operating performance of the Group.

A reconciliation to the relevant IFRS terms is provided in note 3 of the financial statements.

ADJUSTED OPERATING MARGIN

This is calculated as the ratio of adjusted operating profit to revenue. This number is reported as it gives a good indication of the underlying profitability of the Company and how this has changed year-on-year.

ADJUSTED DILUTED EARNINGS PER SHARE

This is calculated as the adjusted profit after tax divided by the diluted number of shares used in the calculation of IFRS diluted earnings per share.

This is used to present a measure of profitability per share in line with adjusted profits.

A reconciliation to IFRS diluted earnings per share is shown in note 3 of the financial statements.

RUN RATE REVENUE AND RUN RATE ADJUSTED OPERATING PROFIT

Run rate revenue is the revenue that the Group would report if the AUM for the year remained static at that shown at 31 March and fee rates were those at 31 March. Run rate revenue margin is the ratio of run rate revenue to AUM.

Run rate adjusted operating profit is the run rate revenue less adjusted operating costs for the month of March extrapolated for 12 months. Adjustments are made to exclude any one-off items.

Run rate numbers are reported as they give a good indication of the current profitability of the Group.

CASH RESERVES

Cash reserves is the sum of cash and cash equivalents and cash held in money market accounts or fixed term deposit accounts less cash held in research payment accounts and cash held by consolidated funds.

The calculation of cash reserves is shown in note 13 to the financial statements.

Cash reserves are reported as they give a good indication of the total cash resources available to the Group.