Half Yearly Report

24 March 2014

Trading Emissions PLC

Results for the six month period ended 31 December 2013

Trading Emissions PLC ("TEP" or "the Company"), a closed ended investment company that specialises in renewable energy projects and emissions instruments, today announces its consolidated results for the six month period ended 31 December 2013.

Financial Highlights

· Net Asset Value: GBP 55.9 million (22.38 pence per share).

· Private Equity Portfolio: GBP 41.9 million (16.77 pence per share).

· Net other assets (principally cash): GBP 14.0 million (5.60 pence per share).

Operational Highlights

· Distribution of GBP 37.5 million to shareholders in July 2013 by means of B share scheme.

· Participation in the World Bank's Umbrella Carbon Facility Tranche 1 terminated in September 2013, which freed up GBP 4.0 million of restricted cash.

· Sale of Asia Biogas.

· Proceeds of GBP 1.0 million received from realisations, liquidations and distributions during the period.

· ERPAs sold post year end.

· Further distribution to shareholders expected to be announced before the end of the financial year.

For further information:

Liberum +44 (0)20 3100 2222

Steve Pearce / Tom Fyson

IOMA Fund and Investment Management Limited +44 (0)1624 681200

Philip Scales

Trading Emissions PLC

Consolidated Interim Financial Statements

For the period ended 31 December 2013

Chairman's Statement

Dear Shareholder

We continue to make steady progress in implementing the realisation and distribution objectives of Trading Emissions PLC ("TEP" or the "Company"). It will be no surprise to Shareholders that the private equity and carbon investments are becoming progressively more difficult to sell. Although progress is somewhat slower than we would have liked, given the nature of TEP's portfolio and the issues we have encountered, some notable milestones have been achieved.

You will recall that the role of EEA changed with effect from 1 January 2014, such that they provide short term consultancy-type services in relation to the private equity and carbon portfolios rather than the full investment advisory service provided hitherto. EEA's more limited role means that the customary Investment Advisor's Report is not provided with these interim financial statements nor will it be provided in future. The Board has direct responsibility for the management and realisation of investments and a summary of the key developments with regard to each holding in the portfolio is provided below.

Financial Highlights

During the first half of the financial year, the Net Asset Value ("NAV") of the Company decreased to GBP 55.9 million (22.38p per share), compared with GBP 75.1 million (30.08p per share) on 30 June 2013. The reduction in NAV was caused mainly by a reduction of GBP 15.2 million in the value of the private equity investments as a result of both disposals and write downs as described in more detail below. The liabilities associated with the carbon portfolio increased by GBP 1.3 million (0.51 per share).

The aggregate value of the private equity portfolio at 31 December 2013 was GBP 41.9 million, compared with GBP 57.1 million at the beginning of the financial year. Proceeds generated during the first half of the financial year from the realisation and liquidation of investments amounted to GBP 1.0 million (0.40p per share) and the book value of the remaining private equity investments held at 31 December 2013 reduced by GBP 13.1 million (5.24p per share) in the period. The Directors estimate that at 31 December 2013, the comparable fair value of the private equity portfolio was GBP 47.4 million, which is 13% more than the book value calculated in accordance with International Financial Reporting Standards. The difference between book value and fair value is caused mainly by the requirement to consolidate controlled subsidiaries into TEP's financial statements. As in previous periods, TEP continues not to disclose the carrying values of individual private equity investments.

The value of the carbon portfolio at 31 December 2013 was a net liability of GBP 1.7 million (-0.68p per share) compared with a net liability, of GBP 0.4 million (-0.17p per share) at the beginning of the financial year. Given that delivery of fixed price carbon contracts is at a negligible level, no hedges were in place either at the end of December or currently.

Cash and Distributions

Of the unrestricted cash of GBP 55.1 million (22.07p per share) held at the beginning of the financial year, GBP 37.5 million (15.00p per share) was distributed to Shareholders in July 2013 by means of a B share scheme. The consolidated cash balance at 31 December 2013 was GBP 18.6 million (7.43p per share), which includes EUR 4.8 million (GBP 4.0 million) of cash (previously restricted) released when the Umbrella Carbon Facility Tranche 1 ("UCF T1") terminated and GBP 1.0 million from realisations and liquidations of investments. Of this amount GBP 16.4 million was held by the Company. Substantially all cash is unrestricted, although an element is required for working capital purposes within the Group.

Since the end of the period, GBP 5.8 million was received by TEP Solar, most of which will be distributed to the Company in due course.

The Board intends to announce another distribution to Shareholders by means of a further issue of B shares before the end of the financial year.

Private Equity Portfolio

Realisations and Liquidations

The Company has attempted to sell Asia Biogas for more than two years without success. However, during the period, TEP received distributions from the company and sold the remaining investment to management for an aggregate of GBP 0.5 million. After accounting for these receipts, the Company lost GBP 1.6 million compared to the book value on 30 June 2013. This was significantly less than the estimated cost of either rebuilding the business or liquidating the group of companies in Singapore, Thailand, Philippines and Indonesia.

During the period, TEP received an interim distribution of GBP 0.5 million from the process of voluntary winding up of Carbon Capital Markets. Further liquidation proceeds of approximately GBP 0.5 million are expected when Carbon Capital Markets and Sun Biofuels are finally wound up.

Bionasa

The Bionasa investment remains troubled. Operations have ceased; obligations to creditors, including banks and employees, are in default; legal actions have commenced against the company to recover overdue debts; the commercial and finance directors have resigned; and the CEO refuses to communicate with Bionasa's non-executive directors or to hold board meetings. Bionasa's controlling shareholders and the management they appointed have vetoed our proposals to restructure and/ or refinance the business intended to stabilize the company.

Although all final submissions were made to the arbitrators in early December 2013, the final verdict on conversion of our preference shares to a substantial controlling equity interest has been extended beyond the normal decision period. The latest indication is that a decision will be made at the end of March 2014. Enforcement of the final written arbitration verdict may take time. In the interim, we have been developing contingency plans.

The announcement in September 2013 from the Brazilian authorities that it expects to increase the biodiesel content in diesel from 5% to 7% (a notional 40% increase in demand), has yet to be implemented. The industry is struggling and the local press recently reported that 27 of Brazil's 67 biodiesel factories have shut down production.

Element Markets

In the six month period to 31 December 2013, Element Markets generated revenues of USD 31.6 million (GBP 20.1 million), 2.8% below budget. However, for calendar year 2013 (which is the company's financial year), Element Markets earned revenues of USD 58.9 million (GBP 37.6 million), which was 2.6% over budget.

A number of serious expressions of interest have been received for parts or all of the business, which we are considering with management in the context of the longer term strategy for the company and creating partial or complete liquidity events for the shareholders of Element Markets.

EWG Slupsk

Leases on all land plots have been secured and all of the required building and environmental permits are now in place to allow for the construction and operation of EWG Slupsk's proposed wind farm. The Polish courts have approved the split of EWG Slupsk and its assets into three separate operating companies to build and operate a wind farm on each of the three separate project areas.

The draft of the new Polish law on renewable energy has been modified in a way that will facilitate the sale of our investment. We remain in exclusive discussions with a potential buyer of EWG Slupsk or our share in it.

Surya/ TEP Solar

Aggregate revenues at EUR 7.9 million (GBP 6.7 million) from the five photovoltaic plants in Italy were close to budget in the first half of the financial year. The above average levels of irradiation caused overperformance at two of TEP Solar's smaller solar plants and partially offset the financial effect of higher panel degradation at one of the larger plants and potential issues at the two others. We are working with the contractors and panel supplier to rectify the degradation problems and investigating performance at two other plants.

Each of the TEP Solar group companies is current on the repayment and service of its limited recourse debt facilities, which, in total, amounted to EUR 81.3 million (GBP 67.7 million) at 31 December 2013. Excess cash of EUR 6.9 million (GBP 5.8 million) not required to meet operating expenses in Italy was distributed by the operating companies to TEP Solar after the end of the period.

Following the termination of the investment advisory agreement with EEA, all of the key systems and records have been transferred to TEP Solar's management subsidiary based in Rome.

Carbon Portfolio

Following the end of the financial year, TEP announced the sale of the Company's existing stock of carbon credits and portfolio of 24 ERPAs for no material consideration. The long stop date for transferring the ERPAs in the portfolio to the buyer is 12 months. Any remaining ERPAs will be terminated or otherwise disposed of. The liabilities associated with the carbon portfolio will decrease as ERPAs are novated or terminated. The GBP 1.3 million valuation increase in the liability associated with the carbon portfolio during the period was caused mainly by a change in the valuation methodology from a risk based valuation model to the detailed terms of the sale and purchase agreement in respect of those ERPAs which have been sold. The remaining ERPAs continue to be carried on the basis of a valuation risk model.

In September 2013, the UCF T1 for which the World Bank acted as trustee, was terminated. TEP has no outstanding obligations to UCF T1 and no further engagements with the World Bank.

In January 2014, ERPAs with four parties in Mexico were novated and one was terminated. TEP no longer has exposure to any Mexican counterparties.

Changes to the Board

We announced in January 2014 the sad news that Peter Vanderpump had suddenly passed away. Peter had been a Director for over seven years and chaired the Board's Audit Committee for more than two years.

We were fortunate that we were able to welcome Neil Duggan to the Board in February. Neil was formerly a partner with KPMG in the Isle of Man. He has assumed the chairmanship of the Audit Committee and has overseen the preparation of these interim financial statements.

Outlook

There is, of course, no assurance that any of the current realisation negotiations underway will be successful or that sales proceeds will approximate the latest carrying values. TEP's endeavours in the coming months will focus on progressing the EWG Slupsk and Element Markets processes; resolving the issues at Bionasa and TEP Solar with a view to protecting our investments; and novating (and, where not possible, terminating) the remaining ERPAs. As ever, we appreciate your continuing patience and support.

Martin M Adams

Chairman

21 March 2014

Carbon Prices and Currency Rates

Carbon: CER Prices

The following are the Certified Emission Reduction ("CER") futures prices as quoted on the InterContinental Exchange ("ICE") which have been used to value certain Emissions Reduction Purchase Agreements ("ERPAs") at 31 December 2013:

Key foreign exchange rates:

The following are the key foreign exchange rates used in currency conversions at 31 December 2013 and 17 March 2014:

Consolidated Statement of Comprehensive Income

Consolidated Statement of Financial Position

The consolidated interim financial statements were approved and authorised for issue by the Board of Directors on 21 March 2014 and signed on its behalf by:

Philip Scales Neil Duggan

Director Director

Consolidated Statement of Changes in Equity

Consolidated Cash Flow Statement

Notes to the Consolidated Interim Financial Statements

1 Operations

Trading Emissions PLC ("the Company") and its subsidiaries (together "the Group") invests in environmental and emissions assets, companies providing products and services related to the reduction of greenhouse gas emissions and associated financial products. The Investing Policy of the Company is to carry out an orderly realisation of the portfolio of carbon and private equity assets, distribution of the net proceeds to Shareholders and then undertake a voluntary winding-up of the Company. No new private equity investments will be made except where the Board of Directors of the Company considers it necessary to provide follow-on capital to protect an existing investment.

The Company is a closed-ended investment company domiciled in the Isle of Man and the address of its registered office is IOMA House, Hope Street, Douglas, Isle of Man. It was incorporated on 15 March 2005 in the Isle of Man as a public limited company and is quoted on the Alternative Investment Market ("AIM") operated and regulated by the London Stock Exchange. In December 2011, the Company was re-registered under the Isle of Man Companies Act 2006.

2 Basis of Preparation

The unaudited consolidated interim financial statements have been prepared using the recognition measurement principles of International Financial Reporting Standards and Interpretations adopted for use in the European Union (collectively "IFRSs").

The principal accounting policies applied in the preparation of the consolidated interim financial statements are those the Company expects to apply in its financial statements for the year ended 30 June 2014 and are unchanged from those disclosed in the annual audited financial statements for the year ended 30 June 2013 which contained an unqualified Audit Report and included an emphasis of matter relating to the valuation of the private equity investments. These policies have been consistently applied to each of the periods presented. The audited financial statements for the year ended 30 June 2013 are available at www.tradingemissionsplc.com.

While the financial information included in the consolidated interim financial statements has been prepared in accordance with the AIM Rules for Companies, the consolidated interim financial statements do not themselves contain sufficient information to comply fully with IFRSs. As permitted, the Company has chosen not to adopt IAS 34 'Interim Financial Statements' in preparing its consolidated interim financial statements.

The consolidated interim financial statements for the six months ended 31 December 2013 should be read in conjunction with the annual financial statements for the year ended 30 June 2013 which have been prepared in accordance with IFRSs.

The Group has or intends to adopt the following standards no later than the accounting period in which they become effective:

a) IFRS 10 Consolidated financial statements:

The objective of IFRS 10 is to establish principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities. IFRS 10 was endorsed by the EU from 1 January 2014.

b) IFRS 12 Disclosures of interests in other entities:

IFRS 12 includes the disclosure requirements for all forms of interests in other entities. IFRS 12 was endorsed by the EU from 1 January 2014.

c) IFRS 13 Fair value measurement:

IFRS 13 aims to improve consistency and reduce complexity by providing a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across IFRSs. IFRS 13 is effective for periods starting on 1 January 2013. The adoption of IFRS 13 has not had a material impact on the Group.

3 Investment Advisory fees

Investment Advisory fees for the 6 months to 31 December 2013 were GBP 690,000 (for the year ending 30 June 2013: GBP 3,660,000 and for the 6 months ending 31 December 2012: GBP 3,000,000).

The Company entered into an agreement with its Investment Adviser ("Investment Advisory Agreement"), EEA Fund Management Limited ("EEA"), with effect from 1 January 2013. Under the Investment Advisory Agreement the fee structure was split between carbon advisory and private equity advisory services. The total fee in relation to both services was GBP 1,320,000 per annum, payable monthly in advance.

In accordance with the Investment Advisory Agreement, EEA received a one-off performance fee of GBP 30,000 in September 2013 after the Letter of Credit held by the World Bank, acting as Trustee for the UCF T1, was returned to the Company.

The Investment Advisory Agreement terminated on 31 December 2013 and was replaced with a Services Agreement which commenced on 1 January 2014. The Services Agreement can be terminated by either party with one month's notice but termination cannot take effect before 1 April 2014.

Under the Services Agreement, EEA receives a one-off fee of GBP 40,000 and a monthly fee of GBP 45,000 to cover services provided in relation to two private equity investments and the carbon portfolio.

EEA is entitled to an Equity Transaction fee equal to 2.7 per cent of the net aggregate consideration received by the Group on any sale, disposal or liquidation of an investment from the private equity portfolio during the duration of the Services Agreement and under certain circumstances up to 6 months following the termination of the Services Agreement. In addition, EEA is entitled to receive up to GBP 40,000 on the unconditional novation, sale, disposal, termination or renegotiation of ERPAs (on terms approved by the Company) within the term of the Services Agreement and up to 6 months following termination of the Services Agreement.

4 Net foreign exchange (losses)/gains

Net foreign exchange (losses)/gains have arisen on the translation of Euro ("EUR"), United States Dollar ("USD") and Polish Zloty ("PLN") denominated cash deposits and loans to British Pounds ("GBP"), the Company's functional and presentational currency.

5 Other expenses

6 Disposal groups classified as held for sale

Disposal groups are classified as held for sale in accordance with IFRS 5 when their carrying amount will be recovered principally through a sale transaction rather than through continuing use. Disposal groups that are classified as held for sale are available for immediate sale in their present condition, and a sale is probable. The sale of disposal groups is considered probable by the Company when the Directors are committed to the plan, there is an active programme to identify a buyer and when the sale is expected to be completed within 12 months from classification, unless circumstances outside of the Company's control prevent the sale within that period.

Consistent with the Investing Policy, the Board is continuing with its strategy of selling the Company's individual private equity investments in the short to medium term to targeted strategic buyers, with the objective of maximising returns to Shareholders. All of the Company's private equity investments other than those accounted for as financial assets at fair value through profit or loss have been classified as held for sale in accordance with IFRS 5.

A number of the disposal groups have now been held for sale in excess of 12 months. The Board remains committed to the plan of selling the subsidiaries and continues to seek buyers with the objective of selling these investments.

At 31 December 2013, net property, plant and equipment held under finance leases amounted to GBP 6,774,000 (30 June 2013: GBP 6,960,000). Net property, plant and equipment of GBP 60,018,000 (30 June 2013: GBP 71,373,000) is pledged as security for financial liabilities.

7 Cash and cash equivalents and restricted cash

(a) Cash and cash equivalents

For the purpose of the Consolidated Cash Flow Statement, cash and cash equivalents comprise the following balances:

*GBP 16,422,000 (30 June 2013: GBP 52,435,000) is held by the Company.

(b) Restricted cash

At 30 June 2013, restricted cash included GBP 5,037,000 of cash held in a pledge guarantee account which was used specifically for drawdown obligations under the World Bank UCF T1 facility agreement. The Letter of Credit held by the World Bank, acting as Trustee for the UCF T1, was returned to the Company on 4 September 2013. That action released EUR 4,814,000 (GBP 4,013,000) from funds held in the pledge guarantee account. The Company no longer holds any restricted cash in respect of the UCF T1.

As at 31 December 2013, a group company classified as held for sale holds restricted cash of GBP 1,980,000 (30 June 2013: GBP 2,278,000). This primarily relates to margin requirements for positions held through brokers, as well as letters of credit held in relation to trading positions.

8 Leases

A subsidiary of the Group holds a photovoltaic plant ("the Plant") under a finance lease. The lease runs for a period of 216 months until June 2029. The rental amounts are indexed on the basis of monthly average of 3-month EURIBOR. Upon expiration of the agreement, the subsidiary may choose one of the following options:

1. To re-purchase the Plant without receiving any guarantee from the lessor for an amount equal to 1 per cent. of the initial purchase consideration.

2. To deliver to the lessor the Plant, in good condition and free from any encumbrance within 15 business days from the expiration date of the lease. In case of delay, a penalty equal to the last monthly rent increased by one third would apply for each day of delay.

\* The comparative figures have been presented in accordance with the amended disclosure table for leases.

9 Borrowings

*Included within borrowings classified as held for sale (see note 6)

Borrowings are represented by several external debt facilities detailed below.

EUR 36,800,000 facility

This comprises EUR 32,600,000 for a senior term loan facility, EUR 2,200,000 for a true up facility and EUR 2,000,000 for a VAT facility.

For the senior term loan facility and the true up facility the maturity date is 2028 and the interest rate is six month EURIBOR plus a margin of 2.50%. For the VAT facility the maturity date is 2014 and the interest rate is six month EURIBOR plus a margin of 2%.

Security has been established by the lender over the shares of Solar Energy Italia 1 S.r.l. ("SEI"), land rights and a pledge over future receivables. The loan agreement requires that SEI maintains a gearing ratio (capital:external debt) of 20:80.

As at 31 December 2013 the Group had an outstanding balance of EUR 29,876,000 (GBP 24,868,000) (30 June 2013: EUR 30,412,000 (GBP 26,009,000)) under this facility.

Related to this facility are two interest rate swap agreements, with Centrobanca and Deutsche Bank. The swap contract covers 80% of the value of the facility and has a maturity date in 2028. Under the swap contract, SEI pays a fixed interest rate of 3.38% per annum on the outstanding balance. As at 31 December 2013, the fair value of the swap contract was GBP 2,119,000 (30 June 2013: financial liability of GBP 2,438,000), which is recorded as a financial liability at fair value through profit or loss.

EUR 10,998,000 facility

This comprises EUR 9,843,000 for a term loan facility and EUR 1,155,000 for a VAT facility. The VAT facility was repaid in full during the period.

The term loan facility has a maturity date in 2029 and the interest rate is six month EURIBOR plus a margin of 3.05%. The VAT facility had an interest rate of six month EURIBOR plus a margin of 1.8%.

Security has been established by the lender for this facility over the shares of RGP Puglia S.r.l ("Ravano"), land rights and a pledge over future receivables. The loan agreement requires that Ravano maintains a gearing ratio (capital:external debt) of 20:80.

As at 31 December 2013, the Group had an outstanding balance of EUR 8,727,000 (GBP 7,264,000) (30 June 2013: EUR 9,677,000 (GBP 8,276,000)) under this facility.

Related to this facility is an interest rate swap agreement with Centrobanca. The swap contract covers 80% of the value of the facility and has a termination date in 2029. Under the swap contract, Ravano pays a fixed interest rate of 2.855% per annum on the outstanding balance. As at 31 December 2013, the fair value of the swap contract was GBP 373,000 (30 June 2013: financial liability of GBP 457,000), which is recorded as a financial liability at fair value through profit or loss.

EUR 8,273,000 facility

This comprises EUR 7,532,000 for a senior term loan facility and EUR 741,000 for a VAT facility.

For the senior term loan facility, the maturity date is in 2029 and the interest rate is six month EURIBOR plus a margin of 3.05%. For the VAT facility, the maturity date is in 2015 and the interest rate is six month EURIBOR plus a margin of 1.8%.

Security has been established by the lender over the shares of Florasolar S.r.l ("Florasolar"), land rights and a pledge over future receivables. The loan agreement requires that Florasolar maintains a gearing ratio (capital:external debt) of 20:80.

As at 31 December 2013, the Group had an outstanding balance of EUR 7,358,000 (GBP 6,125,000) (30 June 2013: EUR 7,573,000 (GBP 6,477,000)) under this facility.

Related to this facility is an interest rate swap agreement with Centrobanca. The swap contract covers 80% of the value of the facility and has a maturity date in 2029. Under the swap agreement, Florasolar pays a fixed interest rate of 2.46% per annum on the outstanding balance. As at 31 December 2013, the fair value of the swap contract was GBP 129,000 (30 June 2013: financial liability of GBP 183,000), which is recorded as a financial liability at fair value through profit or loss.

EUR 31,000,000 facility

This comprises EUR 31,000,000 for a senior loan facility. The maturity date is 2028 and the interest rate is six month EURIBOR plus a margin of 4.50%.

Security has been established by the lender for this facility over the shares of Solar Energy Italia 6 S.r.l. ("SEI 6"), land rights and a pledge over future receivables. The loan agreement requires that SEI 6 maintains a gearing ratio (capital:external debt) of 25:75.

As at 31 December 2013, the Group had an outstanding balance of EUR 28,931,000 (GBP 24,081,000) (30 June 2013: EUR 29,819,000 (GBP 25,502,000)) under this facility.

Related to this facility is an interest rate swap agreement with UniCredit. The swap agreement covers 80% of the value of the facility and has a maturity date in 2026. Under the swap contract, SEI 6 pays a fixed interest rate of 1.754% per annum on the outstanding balance. As at 31 December 2013, the fair value of the swap contract was GBP 424,000 (30 June 2013: financial asset of GBP 308,000), which is recorded as a financial asset at fair value through profit or loss.

10 Loss per share for the period

(a) Basic

Basic profit or loss per share is calculated by dividing the profit or loss attributable to the equity holders of the Company by the weighted average number of ordinary shares in issue during the period.

(b) Diluted

Diluted profit or loss per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Company had no dilutive potential ordinary shares at each of the reporting dates.

11 Net asset value per share

The net asset value per share is calculated by dividing the net assets attributable to the equity holders of the Company by the number of ordinary shares in issue.

12 Share capital

The total number of authorised and issued ordinary shares of the Company is as follows:

All issued ordinary shares are fully paid, and each ordinary share carries the right to one vote.

13 Distributions paid and declared

The distribution of GBP 37,470,000 by means of a B share scheme was declared on 21 June 2013 and was fully paid on 25 July 2013.

14 Related party transactions

The related party transactions in the period are consistent with the nature and size of transactions disclosed in the notes to the Financial Statements for the year ended 30 June 2013.

The Company operates a Directors Incentive Plan ("DIP") with Martin Adams and Norman Crighton as "Participating Directors". Under the terms of the DIP each of the Participating Directors is entitled to a fee of 0.30% of any distribution to Shareholders and up to a further 0.40% in aggregate between them of any distribution to Shareholders at the discretion of the Remuneration Committee such that the total amount payable to them under the terms of the DIP will not exceed in total 1% of each distribution made.

At 30 June 2013 an accrual of GBP 225,000 was made for the non-discretionary element of the DIP arising from the distribution disclosed in note 13. In July 2013 the Remuneration Committee awarded the Participating Directors a further 0.4% fee which amounted to GBP 149,000 (see note 5). GBP 94,000 is held as a payable in respect of the total DIP arising on the July 2013 distribution.

The Participating Directors have waived their fixed entitlements under the DIP in respect of any future distribution to Shareholders. However the DIP will remain in place and 1% of any future distribution to Shareholders will be shared between Directors at the discretion of the Remuneration Committee.

15 Events after the Reporting date

The Company entered into a sale and purchase agreement ("SPA") on 6 March 2014 to transfer the Company's existing CER stock and 24 ERPAs for no material consideration. The long stop date for transferring the ERPAs in the portfolio is 12 months from the signing of the SPA. The Company expects that any ERPAs that fall outside of the SPA or which are not transferred before the long stop date will be terminated or otherwise disposed of.

On the 20th March 2014, lawyers acting on behalf of the Company received a "Notice of Arbitration" challenging the enforceability of amendments that had been made to two CER Transaction Agreements that had previously been renegotiated with the respective Chinese counterparties to those CER Transaction Agreements.

The claims are for declaratory relief and sums alleged to be payable under the CER Transaction Agreements. The Company intends to rigorously defend these claims.

16 Approval of Consolidated Interim Financial Statements 

The consolidated interim financial statements were approved by the Board on 21 March 2014.

Independent review report to Trading Emissions PLC

Introduction

We have been engaged by the company to review the consolidated interim financial statements in the half-yearly financial report for the six months ended 31 December 2013, which comprises the consolidated statement of comprehensive income, the consolidated statement of financial position, the consolidated statement of changes in equity, the consolidated cash flow statement and related notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the consolidated interim financial statements.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half-yearly financial report in accordance with the AIM Rules for Companies which require that the financial information must be presented and prepared in a form consistent with that which will be adopted in the company's annual financial statements.

As disclosed in note 2, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the European Union. The consolidated interim financial statements included in this half-yearly financial report have been prepared in accordance with the basis of preparation set out in note 2.

Our responsibility

Our responsibility is to express to the Company a conclusion on the consolidated interim financial statements in the half-yearly financial report based on our review. This report, including the conclusion, has been prepared for and only for the company for the purpose of the AIM Rules for Companies and for no other purpose. We do not, in producing this report, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the International Auditing and Assurance Standards Board. 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. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing 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.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the consolidated interim financial statements in the half-yearly financial report for the six months ended 31 December 2013 is not prepared, in all material respects, in accordance with the basis of preparation set out in note 2 and the AIM Rules for Companies.

PricewaterhouseCoopers LLC

Chartered Accountants21 March 2014

Douglas, Isle of Man

(a) The maintenance and integrity of the Trading Emissions PLC website is the responsibility of the directors; the work carried out by the auditor does not involve consideration of these matters and, accordingly, the auditor accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website.

(b) Legislation in the Isle of Man governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.