The funds raised by the issue of 14 per cent non-convertible secured bonds were used to ease the liquidity crunch of the division and to improve its performance by executing high value-added orders, the directors have said in their report to shareholders in the annual report for 1999-2000.

The activity of its engineering division, at Kalyani in West Bengal, dipped marginally, but the performance of the air pollution unit improved in comparison to the previous year.

Last year's annual report had noted that the division was "in dire need of infusion of long-term fund for its sustenance and eventual growth". Unable to find a suitable suitor or a joint-venture partner for its engineering division, Yule management decided to go ahead with the revival- cum- restructuring plan on its own.

It was luckier with the belting division, which is now a 74:26 joint-venture with Phoenix AG of Germany. Yule reported a drop in income to Rs 223.33 crore in fiscal 1999-2000 from Rs 281.31 crore in the previous year. It recorded a Rs 5.75 crore profit before extra-ordinary items for the year to March 31, 2000, compared with Rs 5.29 crore in the previous fiscal. However, most of the qualifications and remarks that have been appearing in the auditors' report over the years continue to exist in the latest annual report.

The management of Andrew Yule continued to avoid provisioning on

* Losses that might arise out of an arbitration award in Hooghly Docking & Engineering Co Ltd;
* Doubtful loans and possible loss on investments in Bengal Coal co Ltd, India Paper Pulp co Ltd, Webfil Ltd and Yule Financing & Leasing Co Ltd;
* Interest free loans recoverable from a company floated by associates of Yule; and,
* On company's expenditure on shrimp-culture project.

Most of the provisioning has not been made since the issues are tied-up before legal bodies or the courts.

There are three new faces on the Yule board - finance director Arindom Mukherjee, Mr KK Jaswal and Mr Jawhar Sircar.

Yule's chairman and managing director Sujit Chakraborti had resigned on July 3, 2000, while Mr AV Singh and Mr PR Ray resigned on October 25, 1999, and January 10, 2000, respectively.

The appointment of Mr Jaswal will be regularised at the company's annual general meeting on September 29.

On the issue of group companies, the report says that the performance of Dishergarh Power Supply Co Ltd, Tide Water Oil Co (India) Ltd and Descon Consultants & Investments Ltd was satisfactory. However, operations at Yule Financing & Leasing Co Ltd continue to be affected due to large scale defaults.

Even the performance of wholly-owned subsidiary Hooghly Printing Co Ltd was not up to the mark, while WEBFIL Ltd, which is already berthed with the Board for Industrial & Financial Reconstruction, is struck by severe liquidity crisis.