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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D. C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File Number: 0-21086
 Global Industries, Ltd.
  Louisiana
    
    72-1212563(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification No.)8000 Global Drive 
Carlyss, Louisiana
    
    70665(Address of principal executive offices)
    
    (Zip Code)
 (337) 583-5000
 None
  þ o
  o o
  Large accelerated filer
þ
    
    Accelerated filer
o
    
    Non-accelerated filer o(Do not check if a smaller reporting
company)
    
    Smaller reporting company o
  o þ




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Global Industries, Ltd.
Table of Contents
 PagePART I   FINANCIAL INFORMATIONItem 1. Financial Statements
    
    
    3Report of Independent Registered Public Accounting Firm
    
    
    3Condensed Consolidated Balance Sheets (Unaudited)
    
    
    4Condensed Consolidated Statements of Operations (Unaudited)
    
    
    5Condensed Consolidated Statements of Cash Flows (Unaudited)
    
    
    6Notes to Condensed Consolidated Financial Statements (Unaudited)
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    22Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    33Item 4. Controls and Procedures
    
    
    34PART II   OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    35Item 1A. Risk Factors
    
    
    35Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    35Item 6. Exhibits
    
    
    36Signature
    
    
    37EX-15.1EX-31.1EX-31.2EX-32.1EX-32.2
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PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements.
 
 Report of Independent Registered Public Accounting Firm
       
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GLOBAL INDUSTRIES, LTD.
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (In thousands)
 September 30
    
    
    December 312009
    
    
    2008(Unaudited)ASSETSCurrent AssetsCash and cash equivalents
    
    $
    380,616
    
    
    $
    287,669Restricted cash
    
    
    1,139
    
    
    
    94,516Marketable securities
    
    
    31,150
    
    
    
    Accounts receivable  net of allowance of $1,070 for 2009
and $12,070 for 2008
    
    
    147,842
    
    
    
    180,018Unbilled work on uncompleted contracts
    
    
    116,994
    
    
    
    86,011Contract costs incurred not yet recognized
    
    
    2,619
    
    
    
    11,982Deferred income taxes
    
    
    2,937
    
    
    
    7,223Assets held for sale
    
    
    8,820
    
    
    
    2,181Prepaid expenses and other
    
    
    57,398
    
    
    
    44,585Total current assets
    
    
    749,515
    
    
    
    714,185Property and Equipment, net
    
    
    680,288
    
    
    
    599,078Other AssetsMarketable
securities  long-term
    
    
    11,103
    
    
    
    42,375Accounts
receivable  long-term
    
    
    24,237
    
    
    
    22,246Deferred charges, net
    
    
    54,948
    
    
    
    70,573Goodwill
    
    
    37,388
    
    
    
    37,388Other
    
    
    8,821
    
    
    
    3,508Total other assets
    
    
    136,497
    
    
    
    176,090Total
    
    $
    1,566,300
    
    
    $
    1,489,353LIABILITIES AND SHAREHOLDERS EQUITYCurrent LiabilitiesCurrent maturities of long term debt
    
    $
    3,960
    
    
    $
    3,960Accounts payable
    
    
    222,938
    
    
    
    207,239Employee-related liabilities
    
    
    24,839
    
    
    
    26,113Income taxes payable
    
    
    53,372
    
    
    
    38,649Accrued interest payable
    
    
    2,229
    
    
    
    5,613Advance billings on uncompleted contracts
    
    
    394
    
    
    
    4,609Accrued anticipated contract losses
    
    
    100
    
    
    
    35,055Other accrued liabilities
    
    
    8,364
    
    
    
    12,053Total current
liabilities
    
    
    316,196
    
    
    
    333,291Long-Term Debt
    
    
    292,225
    
    
    
    289,966Deferred Income Taxes
    
    
    69,604
    
    
    
    64,020Other Liabilities
    
    
    13,318
    
    
    
    13,266Commitments and Contingencies
    
    
    
    
    
    
    Shareholders EquityCommon stock, $0.01 par value, 150,000 shares authorized, and 120,020 and
119,650 shares issued at September 30, 2009 and December 31, 2008,
respectively
    
    
    1,200
    
    
    
    1,197Additional paid-in capital
    
    
    513,309
    
    
    
    509,345Retained earnings
    
    
    473,681
    
    
    
    394,699Treasury stock at cost, 6,130 shares
    
    
    (105,038
    )
    
    
    (105,038
    )Accumulated other comprehensive loss
    
    
    (8,195
    )
    
    
    (11,393
    )Total shareholders equity
    
    
    874,957
    
    
    
    788,810Total
    
    $
    1,566,300
    
    
    $
    1,489,353
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GLOBAL INDUSTRIES, LTD.
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except per share data)
(Unaudited)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302009
    
    
    2008
    
    
    2009
    
    
    2008As adjusted
    
    
    
    
    
    
    As adjusted(Note 10)
    
    
    
    
    
    
    (Note 10)Revenues
    
    $
    203,718
    
    
    $
    218,551
    
    
    $
    768,010
    
    
    $
    820,559Cost of operations
    
    
    163,855
    
    
    
    307,409
    
    
    
    617,609
    
    
    
    847,251Gross profit (loss)
    
    
    39,863
    
    
    
    (88,858
    )
    
    
    150,401
    
    
    
    (26,692
    )Loss (gain) on asset disposals and impairments
    
    
    274
    
    
    
    1,640
    
    
    
    (8,249
    )
    
    
    (372
    )Selling, general and administrative expenses
    
    
    19,075
    
    
    
    25,439
    
    
    
    55,635
    
    
    
    73,439Operating income (loss)
    
    
    20,514
    
    
    
    (115,937
    )
    
    
    103,015
    
    
    
    (99,759
    )Interest income
    
    
    402
    
    
    
    2,476
    
    
    
    1,594
    
    
    
    12,709Interest expense
    
    
    (2,756
    )
    
    
    (4,642
    )
    
    
    (9,978
    )
    
    
    (12,578
    )Other income (expense), net
    
    
    9
    
    
    
    (234
    )
    
    
    6,579
    
    
    
    (1,866
    )Income (loss) before taxes
    
    
    18,169
    
    
    
    (118,337
    )
    
    
    101,210
    
    
    
    (101,494
    )Income tax expense (benefits)
    
    
    4,151
    
    
    
    (15,229
    )
    
    
    22,228
    
    
    
    (10,364
    )Net income (loss)
    
    $
    14,018
    
    
    $
    (103,108
    )
    
    $
    78,982
    
    
    $
    (91,130
    )Earnings (Loss) Per Common ShareBasic
    
    $
    0.12
    
    
    $
    (0.90
    )
    
    $
    0.69
    
    
    $
    (0.80
    )Diluted
    
    $
    0.12
    
    
    $
    (0.90
    )
    
    $
    0.69
    
    
    $
    (0.80
    )Weighted Average Common Shares OutstandingBasic
    
    
    112,693
    
    
    
    114,493
    
    
    
    112,550
    
    
    
    114,135Diluted
    
    
    113,278
    
    
    
    114,493
    
    
    
    113,118
    
    
    
    114,135
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GLOBAL INDUSTRIES, LTD.
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
(Unaudited)
 Nine Months EndedSeptember 302009
    
    
    2008As adjusted(Note 10)Cash Flows From Operating ActivitiesNet income (loss)
    
    $
    78,982
    
    
    $
    (91,130
    )Adjustments to reconcile net income (loss) to net cash provided by (used in)
operating activities:Depreciation and non-stock-based amortization
    
    
    47,427
    
    
    
    40,545Stock-based compensation expense
    
    
    5,207
    
    
    
    10,179Provision for doubtful accounts
    
    
    3,161
    
    
    
    5,368Gain on sale or disposal of property and equipment
    
    
    (9,207
    )
    
    
    (1,929
    )Derivative (gain) loss
    
    
    (838
    )
    
    
    613Loss on asset impairments
    
    
    958
    
    
    
    1,557Deferred income taxes
    
    
    7,006
    
    
    
    (34,753
    )Excess tax benefits from stock-based compensation
    
    
    (57
    )
    
    
    (4,019
    )Changes in operating assets and liabilitiesAccounts receivable, unbilled work, and contract costs
    
    
    5,403
    
    
    
    (27,795
    )Prepaid expenses and other
    
    
    (15,938
    )
    
    
    (23,389
    )Accounts payable, employee-related liabilities, and other accrued liabilities
    
    
    (59,310
    )
    
    
    50,306Deferred dry-docking costs incurred
    
    
    (6,465
    )
    
    
    (47,419
    )Net cash provided by (used in) operating activities
    
    
    56,329
    
    
    
    (121,866
    )Cash Flows From Investing ActivitiesProceeds from the sale of assets
    
    
    26,915
    
    
    
    6,476Additions to property and equipment
    
    
    (79,018
    )
    
    
    (240,113
    )Purchase of marketable securities
    
    
    
    
    
    
    (49,296
    )Sale of marketable securities
    
    
    
    
    
    
    106,804Decrease in (additions to) restricted cash
    
    
    93,377
    
    
    
    (16
    )Net cash provided by (used in) investing activities
    
    
    41,274
    
    
    
    (176,145
    )Cash Flows From Financing ActivitiesRepayment of long-term debt
    
    
    (3,960
    )
    
    
    (3,960
    )Proceeds from sale of common stock, net
    
    
    126
    
    
    
    8,607Repurchase of common stock
    
    
    (283
    )
    
    
    (27,770
    )Additions to deferred charges
    
    
    (596
    )
    
    
    (87
    )Excess tax benefits from stock-based compensation
    
    
    57
    
    
    
    4,019Net cash provided by (used in) financing activities
    
    
    (4,656
    )
    
    
    (19,191
    )Cash and cash equivalentsIncrease (decrease)
    
    
    92,947
    
    
    
    (317,202
    )Beginning of period
    
    
    287,669
    
    
    
    723,450End of period
    
    $
    380,616
    
    
    $
    406,248Supplemental DisclosuresInterest paid, net of amounts capitalized
    
    $
    11,128
    
    
    $
    10,203Income taxes paid
    
    $
    10,271
    
    
    $
    37,865Property and equipment additions included in accounts payable
    
    $
    71,154
    
    
    $
    19,070
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Notes to Condensed Consolidated Financial Statements (Unaudited)
 1.
    
    General
 Basis of PresentationThe accompanying unaudited Condensed Consolidated Financial Statements include the accounts
of Global Industries, Ltd. and its subsidiaries (Company, we, us, or our).In the opinion of our management, all adjustments (such adjustments consisting of a normal
and recurring nature) necessary for a fair presentation of the operating results for the
interim periods presented have been included in the unaudited Condensed Consolidated
Financial Statements. Operating results for the period ended September 30, 2009, are not
necessarily indicative of the results that may be expected for the year ending December 31,
2009. These financial statements should be read in conjunction with our audited
Consolidated Financial Statements and related notes thereto included in our Current Report
on Form 8-K dated October 6, 2009.We have evaluated all subsequent events through November 5, 2009, the date the financial
statements were issued.All $ represent U.S. Dollars.Recent Accounting PronouncementsSFAS 168. In June 2009, the FASB issued SFAS No. 168, The FASB Accounting Standards
Codification and the Hierarchy of Generally Accepted Accounting Principles(SFAS 168)
(ASC Topic 105). SFAS 168 establishes the FASB Accounting Standards
CodificationTM (the Codification or ASC) as the single source of
authoritative, nongovernmental generally accepted accounting principles (GAAP), other than
guidance issued by the SEC. ASC does not change GAAP; it introduces a new structure for
organizing GAAP and limits the hierarchy to two levels-authoritative and nonauthoritative.
ASC is effective for interim or annual financial periods ending after September 15, 2009.
We adopted ASC beginning on July 1, 2009 and the principal impact on our financial
statements is limited to disclosures as all future references to authoritative accounting
literature will be referenced in accordance with the Codification. In order to ease the
transition to the Codification, we are providing the Codification cross reference alongside
the references to the standards issued and adopted prior to the adoption of the
Codification.SFAS 165. In May 2009, the FASB issued SFAS No. 165, Subsequent Events(ASC 855). This
guidance establishes general standards of accounting for and disclosures of events that
occur after the balance sheet date but before financial statements are issued or are
available to be issued. This guidance is effective for interim or annual financial periods
ending after June 15, 2009. We adopted this guidance beginning April 1, 2009. The adoption
of this guidance did not have a material impact on our financial statements. See Note 1 for
disclosures required by this guidance.In April 2009, the FASB issued three FASB Staff Positions (FSP) intended to provide
additional application guidance and enhanced disclosures regarding fair value measurements
and impairments of securities. These FSPs are effective for interim and annual reporting
periods ending after June 15, 2009. We adopted these standards on a prospective basis
beginning April 1, 2009. The adoption of these standards did not have a material impact on
our consolidated results of operations and financial condition.
 FSP FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the
Asset or Liability Have Significantly Decreased and Identifying Transactions That are Not
Orderly
 FSP FAS 115-2 and FAS 124-2 Recognition and Presentation of Other-Than-Temporary
Impairments
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FSP FAS 107-1 and APB 28-1 Interim Disclosures about Fair Value of Financial
Instruments
 SFAS 161. In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative
Instruments and Hedging Activities(ASC 815-10-50). This guidance requires specific
disclosures regarding the location and amounts of derivative instruments in our financial
statements, how derivative instruments and related hedged items are accounted for, and how
derivative instruments and related hedged items affect our financial position, financial
performance, and cash flows. This guidance is effective for financial statements issued for
fiscal years and interim periods beginning after November 15, 2008. We adopted this guidance
beginning January 1, 2009. See Note 4 for disclosures required by this guidance.FSP APB 14-1. In May 2008, the FASB issued FSP APB No. 14-1, Accounting for Convertible
Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash
Settlement)(ASC 470-20), which changed the accounting for our 2.75% Senior Convertible
Debentures (Debentures) due 2027. This guidance requires cash settled convertible debt to
be separated into debt and equity components at issuance and a value to be assigned to each.
The value assigned to the debt component is the estimated fair value of similar bonds
without the conversion feature. The difference between the bond cash proceeds and this
estimated fair value is recorded as a debt discount and amortized to interest expense over
the life of the bond. Although this guidance has no impact on our actual past or future cash
flows, it requires us to record a material increase in non-cash interest expense as the debt
discount is amortized. This guidance became effective for us beginning January 1, 2009 and
is applied retrospectively to all periods presented. See Note 10 for disclosures required
by this guidance.FSP EITF 03-6-1.In June 2008, the FASB issued FSP EITF 03-6-1, Determining Whether
Instruments Granted in Share-Based Payment Transactions Are Participating Securities (ASC
260-10-65-2). This guidance addresses whether instruments granted in share-based payment
transactions are participating securities prior to vesting and, therefore, need to be
included in computing earnings per share under the two-class method. We adopted this
guidance retrospectively beginning January 1, 2009. See Note 16 for disclosure of the
financial statement impact from implementation of this guidance.ASU No. 2009-05. In August 2009, FASB issued ASU No. 2009-05 which amends Fair Value
Measurements and Disclosures  Overall (ASC Topic 820-10) to provide guidance on the fair
value measurement of liabilities. This update requires clarification for circumstances in
which a quoted price in an active market for the identical liability is not available. A
reporting entity is required to measure fair value using one or more of the following
techniques: 1) a valuation technique that uses either the quoted price of the identical
liability when traded as an asset or quoted prices for similar liabilities when traded as an
asset; or 2) another valuation technique that is consistent with the principles in ASC Topic
820 such as the income and market approach to valuation. The amendment in this update also
clarifies that when estimating the fair value of a liability, a reporting entity is not
required to include a separate input or adjustment to other inputs relating to the existence
of a restriction that prevents the transfer of the liability. This update further clarifies
that if the fair value of a liability is determined by reference to a quoted price in an
active market for an identical liability, that price would be considered a Level 1
measurement in the fair value hierarchy. Similarly, if the identical liability has a quoted
price when traded as an asset in an active market, it is also a Level 1 fair value
measurement if no adjustments to the quoted price of the asset are required. This update is
effective for our fourth quarter 2009 and we are currently evaluating the impact of adopting
this update on our consolidated financial statements.SFAS 167. In June 2009, the FASB issued SFAS No. 167, Amendments to FASB Interpretation No.
 46(R), Consolidation of Variable Interest Entities (ASC Topic 810-10). This updated guidance
requires an analysis to determine whether a variable interest gives the entity a controlling
financial interest in a variable interest entity. It also requires an ongoing reassessment
and eliminates the quantitative approach previously required for determining whether an
entity is the primary beneficiary. This update is effective for our fiscal year beginning
January 1, 2010 and we are currently evaluating the impact of adopting this update on our
consolidated financial statements.
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2.
    
    Restricted Cash
 As a result of operating performance, the interim cash collateralization period related to
the November 2008 waiver and amendment of our Revolving Credit Facility ended effective June
30, 2009 and previously restricted cash representing cash collateral for outstanding letters
of credit and bank guarantees was released from restriction. See Note 10 for a discussion of
this development. At September 30, 2009, restricted cash was comprised of cash deposits
related to foreign currency exchange arrangements. Restrictions with respect to these
deposits will remain in effect until we terminate the associated foreign currency exchange
arrangement.
 3.
    
    Marketable Securities
 As of September 30, 2009, we held $42.4 million at par value in auction rate securities
which are variable rate bonds tied to short-term interest rates with maturities up to 30
years. Auction rate securities have interest rate resets through a Dutch auction at
predetermined short intervals. Interest rates generally reset every 7-49 days. The coupon
interest rate for these securities ranged from 0.4% to 0.9%, on a tax exempt basis for the
three months ended September 30, 2009.Our investments in auction rate securities were issued by municipalities and state education
agencies. The auction rate securities issued by state education agencies represent pools of
student loans for which repayment is substantially guaranteed by the U.S. government under
the Federal Family Education Loan Program. All of our investments in auction rate securities
have at least a double A rating. As of September 30, 2009, the par value of auction rate
securities issued by state education agencies was $30.0 million and the par value of auction
rate securities issued by municipalities was $12.4 million.Auctions for our auction rate securities continue to fail in 2009. An auction failure,
which is not a default in the underlying debt instrument, occurs when there are more sellers
than buyers at a scheduled interest rate auction date. This results in a lack of liquidity
for these securities, even though debt service continued to occur. During the nine months
ended September 30, 2009, we continued to earn and receive scheduled interest on these
securities.Auction Rate Securities under Settlement Agreement- In November 2008, we accepted an
auction rate security rights agreement (the Settlement) with UBS Financial Services, Inc.
(UBS) that permits us to sell or put all of our auction rate securities issued by state
education agencies and one auction rate security issued by a municipality back to UBS at par
value at any time during the period from June 30, 2010 through July 2, 2012. We expect to
put these auction rate securities back to UBS on June 30, 2010, the earliest date allowable
under the Settlement, if not sold prior to that date; therefore, these securities are
classified as current as of September 30, 2009. We reclassified these auction rate
securities to trading securities. Consequently, we will be required to assess the fair value
of the Settlement and these auction rate securities and record changes in earnings each
period until the Settlement is exercised and the securities are redeemed. As of September
30, 2009, the fair value of auction rate securities covered under the Settlement was $28.0
million, a decline of $2.8 million from par value, but an improvement in the $3.1 million
impairment recognized at December 31, 2008. We recognized the $2.8 million decline in par
value as an other-than-temporary impairment in Other income (expense), net on the Condensed
Consolidated Statement of Operations. However, as we will be permitted to put these
securities back to UBS at par, we recognized an offsetting $2.8 million gain on the fair
value assessment of the Settlement in Other income (expense), net. Although the Settlement
represents the right to sell the securities back to UBS at par, we will be required to
periodically assess the economic ability of UBS to meet that obligation in assessing the
fair value of the Settlement.Auction Rate Securities issued by MunicipalitiesOf our total $12.4 million investment in
auction rate securities issued by municipalities, $11.6 million are not covered under the
Settlement, remain classified as available for sale and are carried at fair value with any
unrealized gains and losses recorded in Other Comprehensive Income. We concluded the fair
value of these auction rate securities issued by municipalities at September 30, 2009 was
$11.5 million, a decline of $0.1 million from par value. The decline in fair value has been
assessed as temporary and has been recorded as an unrealized loss in Accumulated Other
Comprehensive Income (Loss), net of tax of $0.04 million. We will continue to monitor the
market for auction rate securities and consider its impact, if any, on fair value of the
remaining investment through disposition. Subsequent to September 30, 2009, we sold $0.4
million of these securities and therefore classified this portion of the securities as
current at September 30, 2009.
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4.
    
    Derivatives
 We use forward contracts to manage our exposure in foreign currency exchange rates. Our
outstanding forward foreign currency contracts at September 30, 2009 are used to hedge cash
flows for long-term charter payments on two multi-service vessels denominated in Norwegian
Kroners and certain purchase commitments related to the construction of the Global 1200 in
Singapore that are denominated in Singapore Dollars.The Norwegian Kroner forward contracts have maturities extending until June 2011 and are
accounted for as cash flow hedges with the effective portion of unrealized gains and losses
recorded in Accumulated Other Comprehensive Income (Loss) and reclassified into earnings in
the same period or periods during which the hedged transaction affects earnings. As of
September 30, 2009, there was $0.9 million in unrealized gains, net of taxes, in Accumulated
Other Comprehensive Income (Loss) of which $0.6 million is expected to be realized in
earnings during the twelve months following September 30, 2009. As of September 30, 2009,
these contracts are included in Prepaid expenses and other and Other assets on the Condensed
Consolidated Balance Sheets, valued at $0.9 million and $0.4 million, respectively. For the
three months and nine months ended September 30, 2009, we recorded $0.1 million in realized
gains and $0.6 million in realized losses, respectively related to these contracts which are
included in Other income (expense), net on the Consolidated Statement of Operations. For
the three months and nine months ended September 30, 2008, we recorded $1.2 million and $3.6
million, respectively in realized gains related to these contracts which are included in
Other income (expense), net on the Consolidated Statement of Operations. As of December 31,
2008, there was $2.4 million of unrealized losses, net of tax, in Accumulated Other
Comprehensive Income (Loss). As of December 31, 2008, these contracts were included in
Other accrued liabilities and Other liabilities, long-term on the Condensed Consolidated
Balance Sheets, valued at $2.0 million and $1.7 million respectively.During the second quarter of 2009, we entered into two forward contracts to purchase 18.9
million Singapore Dollars to hedge certain purchase commitments in the first quarter of 2010
related to the construction of the Global 1200 in Singapore. We have not elected hedge
treatment for these contracts. Consequently, changes in the fair value of these instruments
are recorded in Other income (expense), net on the Consolidated Statement of Operations.
For the three months and nine months ended September 30, 2009, we recorded $0.4 million and
$0.8 million, respectively in gains related to these two contracts. As of September 30,
2009, the fair value of these contracts was $0.8 million and is included in Prepaid expenses
and other on the Condensed Consolidated Balance Sheets.
 5.
    
    Fair Value of Financial Instruments
 In accordance with accounting guidance, fair value is defined as the price that would be
received to sell an asset or paid to transfer a liability (i.e. exit price) in an orderly
transaction between market participants at the measurement date. This guidance establishes
a hierarchy for inputs used in measuring fair value that maximizes the use of observable
inputs and minimizes the use of unobservable inputs by requiring that the most observable
inputs be used when available. The hierarchy for inputs is categorized into three levels
based on the reliability of inputs as follows:
 Level 1
    
    
    
    Observable inputs such as quoted prices in active markets.Level 2
    
    
    
    Inputs (other than quoted prices in active markets) that are either directly
or indirectly observable.Level 3
    
    
    
    Unobservable inputs which require managements best estimate of
what market participants would use in pricing the asset or liability.
 10




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Assets measured at fair value on a recurring basis are categorized in the table below based
upon the lowest level of significant input to the valuations.
 Fair Value Measurements at September 30, 2009  (In thousands)
 Description
    
    Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3Cash equivalents
    
    $
    183,798
    
    
    $
    183,798
    
    
    $
    
    
    
    $
    Marketable securities
    
    
    42,253
    
    
    
    
    
    
    
    
    
    
    
    42,253Derivative contracts
    
    
    2,163
    
    
    
    
    
    
    
    2,163
    
    
    
    Total
    
    $
    228,214
    
    
    $
    183,798
    
    
    $
    2,163
    
    
    
    42,253
 Financial instruments classified as Level 3 in the fair value hierarchy represent auction
rate securities and the related put option in which management has used at least one
significant unobservable input in the valuation model.Due to the lack of observable market quotes on our auction rate securities portfolio, we
utilize a valuation model that relies on Level 3 inputs including market, tax status, credit
quality, duration, recent market observations and overall capital market liquidity. The
valuation of our auction rate securities is subject to uncertainties that are difficult to
predict. Factors that may impact our valuation include changes to credit ratings of the
securities as well as to the underlying assets supporting those securities, rates of default
of the underlying assets, underlying collateral value, discount rates, counterparty risk and
ongoing strength and quality of market credit and liquidity.The following table presents a reconciliation of activity for such securities:
 Changes in Level 3 Financial Instruments  (In thousands)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302009
    
    
    2008
    
    
    2009
    
    
    2008Balance at beginning of period
    
    $
    41,035
    
    
    $
    41,968
    
    
    $
    42,375
    
    
    $
    48,800Purchases, issuances, and settlements
    
    
    
    
    
    
    (200
    )
    
    
    
    
    
    
    (13,250
    )Total gains or losses:Included in other comprehensive
income
    
    
    1,218
    
    
    
    
    
    
    
    (122
    )
    
    
    (907
    )Transfers in to Level 3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,125Transfers out of Level 3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,000
    )Balance at end of period
    
    $
    42,253
    
    
    $
    41,768
    
    
    $
    42,253
    
    
    $
    41,768
 6.
    
    Receivables
 Receivables are presented in the following balance sheet accounts: (1) accounts receivable,
(2) accounts receivable  long term, (3) unbilled work on uncompleted contracts, and
(4) contract costs incurred not yet recognized. Accounts receivable are stated at net
realizable value, and the allowances for uncollectible accounts were $1.1 million and $12.1
million at September 30, 2009 and December 31, 2008, respectively. Accounts receivable at
September 30, 2009 and December 31, 2008 included $11.1 million and $0.1 million,
respectively, of retainage, which represents the short-term portion of amounts not
immediately collectible due to contractually specified requirements. Accounts receivable 
long term at September 30, 2009 and December 31, 2008 represented amounts related to
retainage which were not expected to be collected within the next twelve months.
 11




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##### Table of Contents



Costs and Estimated Earnings on Uncompleted Contracts
 September 30
    
    
    December 312009
    
    
    2008(In thousands)Costs incurred and recognized on uncompleted contracts
    
    $
    1,093,706
    
    
    $
    738,496Estimated earnings
    
    
    40,444
    
    
    
    (19,411
    )Costs and estimated earnings on uncompleted contracts
    
    
    1,134,150
    
    
    
    719,085Less: Billings to date
    
    
    (1,025,328
    )
    
    
    (653,373
    )108,822
    
    
    
    65,712Plus: Accrued revenue(1)
    
    
    7,778
    
    
    
    15,770Less: Advance billing on uncompleted contracts
    
    
    
    
    
    
    (80
    )$
    116,600
    
    
    $
    81,402Included in accompanying balance sheets under the
following captions:Unbilled work on uncompleted contracts
    
    $
    116,994
    
    
    $
    86,011Advance billings on uncompleted contracts
    
    
    (394
    )
    
    
    (4,609
    )$
    116,600
    
    
    $
    81,402
 
 (1)
    
    Accrued revenue represents unbilled amounts receivable related to work performed on projects for which the
percentage of completion method is not applicable. 7.
    
    Asset Disposal and Impairments and Assets Held for Sale
  Net Gains and (Losses) on Asset Disposal
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 30Segment
    
    Description of Asset
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008(In thousands)North America Subsea
    
    One Dive Support Vessel (DSV) in 2009 and Other
    
    $
    (64
    )
    
    $
    (83
    )
    
    $
    5,003
    
    
    $
    (179
    )Latin America
    
    Other
    
    
    (2
    )
    
    
    
    
    
    
    (13
    )
    
    
    (176
    )West Africa
    
    Two cargo barges and one DSV
    
    
    (145
    )
    
    
    
    
    
    
    643
    
    
    
    Asia Pacific
    
    One Derrick Lay Barge (DLB) and Other
    
    
    (58
    )
    
    
    12
    
    
    
    3,370
    
    
    
    4Middle East
    
    One DSV in 2008 and Other in 2009 and 2008
    
    
    (5
    )
    
    
    (12
    )
    
    
    230
    
    
    
    2,280Corporate
    
    Other
    
    
    
    
    
    
    
    
    
    
    (26
    )
    
    
    $
    (274
    )
    
    $
    (83
    )
    
    $
    9,207
    
    
    $
    1,929
 12




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##### Table of Contents



Losses on Asset Impairments
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 30Segment
    
    Description of Asset
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008(In thousands)North America Subsea
    
    One DSV and Three
Dive Systems
    
    $
    
    
    
    $
    
    
    
    $
    768
    
    
    $
    Latin America
    
    One DSV
    
    
    
    
    
    
    
    
    
    
    190
    
    
    
    West Africa
    
    One DSV
    
    
    
    
    
    
    1,557
    
    
    
    
    
    
    
    1,557$
    
    
    
    $
    1,557
    
    
    $
    958
    
    
    $
    1,557
  Assets Held for Sale
 September 30
    
    
    
    
    December 31Segment
    
    Description of Asset
    
    2009
    
    
    Description of Asset
    
    2008(In thousands)
    
    
    
    
    (In thousands)North America Subsea
    
    None
    
    $
    
    
    
    One DSV and Dive System
    
    $
    749West Africa
    
    One DLB and One DSV
    
    
    6,673
    
    
    One DSV
    
    
    1,000Asia Pacific
    
    Other
    
    
    2,147
    
    
    None
    
    
    Middle East
    
    None
    
    
    
    
    
    One DLB
    
    
    432$
    8,820
    
    
    
    
    $
    2,181
 8.
    
    Property and Equipment
  September 30
    
    
    December 312009
    
    
    2008(In thousands)Land
    
    $
    6,322
    
    
    $
    6,322Facilities and equipment
    
    
    189,132
    
    
    
    179,650Marine vessels
    
    
    482,452
    
    
    
    535,042Construction in progress
    
    
    317,748
    
    
    
    208,827Total property and equipment
    
    
    995,654
    
    
    
    929,841Less: Accumulated depreciation
    
    
    (315,366
    )
    
    
    (330,763
    )Property and equipment, net
    
    $
    680,288
    
    
    $
    599,078
  13




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9.
    
    Deferred Dry-Docking Costs
   Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302009
    
    
    2008
    
    
    2009
    
    
    2008(In thousands)
    
    
    (In thousands)Net book value at beginning of period
    
    $
    50,538
    
    
    $
    66,940
    
    
    $
    61,552
    
    
    $
    30,735Additions for the period
    
    
    1,209
    
    
    
    5,349
    
    
    
    6,465
    
    
    
    47,419Reclassifications to assets held
for sale
    
    
    
    
    
    
    
    
    
    
    (4,914
    )
    
    
    Amortization expense for the period
    
    
    (5,251
    )
    
    
    (4,780
    )
    
    
    (16,607
    )
    
    
    (10,645
    )Net book value at end of period
    
    $
    46,496
    
    
    $
    67,509
    
    
    $
    46,496
    
    
    $
    67,509
 10.
    
    Long-Term Debt
  September 30
    
    
    December 312009
    
    
    2008(In thousands)Senior convertible debentures due 2027, 2.75%
    
    $
    234,805
    
    
    $
    228,586Title XI bonds due 2025, 7.71%
    
    
    61,380
    
    
    
    65,340Revolving credit facility
    
    
    
    
    
    
    Total long-term debt
    
    
    296,185
    
    
    
    293,926Less: Current maturities
    
    
    3,960
    
    
    
    3,960Long-term debt less current maturities
    
    $
    292,225
    
    
    $
    289,966
  Senior Convertible Debentures
  14




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##### Table of Contents



September 30
    
    
    December 312009
    
    
    2008(In thousands)Principal amount of debt component
    
    $
    325,000
    
    
    $
    325,000Less: Unamortized debt discount
    
    
    90,195
    
    
    
    96,414Carrying amount of debt component
    
    $
    234,805
    
    
    $
    228,586Debt discount on issuance
    
    $
    107,261
    
    
    $
    107,261Less: Issuance costs
    
    
    2,249
    
    
    
    2,249Deferred income tax
    
    
    36,772
    
    
    
    36,772Carrying amount of equity component
    
    $
    68,240
    
    
    $
    68,240
  Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302009
    
    
    2008
    
    
    2009
    
    
    2008(In thousands)
    
    
    (In thousands)Contractual interest coupon, 2.75%
    
    $
    2,235
    
    
    $
    2,235
    
    
    $
    6,703
    
    
    $
    6,703Amortization of debt discount
    
    
    2,116
    
    
    
    1,966
    
    
    
    6,219
    
    
    
    5,777Total Debentures interest expense
    
    $
    4,351
    
    
    $
    4,201
    
    
    $
    12,922
    
    
    $
    12,480Effective interest rate
    
    
    7.5
    %
    
    
    7.5
    %
    
    
    7.5
    %
    
    
    7.5
    %
 Revolving Credit Facility
  11.
    
    Commitments and Contingencies
 Commitments
 Construction and Purchases in Progress  Global 1200 Global 1201 
 15




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Off Balance Sheet Arrangements 
 Contingencies
        16




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##### Table of Contents



12.
    
    Comprehensive Income (Loss)
 Other Comprehensive Income (Loss)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302009
    
    
    2008
    
    
    2009
    
    
    2008(In thousands)Net income (loss)
    
    $
    14,018
    
    
    $
    (103,108
    )
    
    $
    78,982
    
    
    $
    (91,130
    )Unrealized gain (loss) on derivatives
    
    
    2,077
    
    
    
    (7,005
    )
    
    
    5,041
    
    
    
    (5,969
    )Unrealized gain (loss) on auction rate securities
    
    
    1,218
    
    
    
    
    
    
    
    (122
    )
    
    
    (907
    )Deferred tax benefit (expense)
    
    
    (1,154
    )
    
    
    2,452
    
    
    
    (1,722
    )
    
    
    2,337Comprehensive income (loss)
    
    $
    16,159
    
    
    $
    (107,661
    )
    
    $
    82,179
    
    
    $
    (95,669
    )
 Accumulated Other Comprehensive Income (Loss) 
 Forward
    
    
    
    
    
    
    AccumulatedAccumulated
    
    
    Foreign
    
    
    
    
    
    
    OtherTranslation
    
    
    Currency
    
    
    Auction Rate
    
    
    ComprehensiveAdjustment
    
    
    Contracts
    
    
    Securities
    
    
    Income (Loss)(In thousands)Balance at December 31, 2008
    
    $
    (8,978
    )
    
    $
    (2,415
    )
    
    $
    
    
    
    $
    (11,393
    )Change in value
    
    
    
    
    
    
    2,651
    
    
    
    (79
    )
    
    
    2,572Reclassification to earnings
    
    
    
    
    
    
    626
    
    
    
    
    
    
    
    626Balance at September 30, 2009
    
    $
    (8,978
    )
    
    $
    862
    
    
    $
    (79
    )
    
    $
    (8,195
    )
  13.
    
    Stock-Based Compensation
  17




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The table below sets forth the total amount of stock-based compensation expense for the
three and nine months ended September 30, 2009 and 2008.
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302009
    
    
    2008
    
    
    2009
    
    
    2008(In thousands)Stock-based compensation expenseStock options
    
    $
    156
    
    
    $
    784
    
    
    $
    613
    
    
    $
    2,342Time-based restricted stock
    
    
    1,319
    
    
    
    2,020
    
    
    
    3,912
    
    
    
    6,040Performance shares and units
    
    
    286
    
    
    
    727
    
    
    
    682
    
    
    
    1,797Total stock-based compensation expense
    
    $
    1,761
    
    
    $
    3,531
    
    
    $
    5,207
    
    
    $
    10,179
 14.
    
    Other Income (Expense), net
 Components of other income (expense), net are as follows:
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302009
    
    
    2008
    
    
    2009
    
    
    2008(In thousands)Foreign exchange rate gain (loss)
    
    $
    (2,488
    )
    
    $
    (222
    )
    
    $
    1,864
    
    
    $
    (2,457
    )Derivative contract gain (loss)
    
    
    354
    
    
    
    (186
    )
    
    
    838
    
    
    
    403Insurance settlement(s)
    
    
    1,750
    
    
    
    
    
    
    
    2,728
    
    
    
    Other
    
    
    393
    
    
    
    174
    
    
    
    1,149
    
    
    
    188Total
    
    $
    9
    
    
    $
    (234
    )
    
    $
    6,579
    
    
    $
    (1,866
    )
 15.
    
    Income Taxes
 Our effective tax rates for the three and nine months ended September 30, 2009 were 22.8%
and 22.0%, respectively, and 12.9% and 10.2% for the three and nine months ended September
30, 2008, respectively. The first nine months of 2009 had earnings in foreign jurisdictions
with deemed profit tax regimes where tax is calculated as a percentage of revenue and losses
utilized that were not previously tax benefited, resulting in a lower effective rate when
compared to the corporate tax rate in the United States of 35%. The first nine months of
2008 included losses that could not be tax effected and low margins in tax jurisdictions
with deemed profit regimes, resulting in a lower tax benefit when compared to the 35% U.S.
corporate tax rate.
 16. Earnings Per Share
 Basic earnings per share (EPS) is computed by dividing earnings (loss) attributed to
common shareholders during the period by the weighted average number of shares of common
stock outstanding during each period. Diluted EPS is computed by dividing net income
(loss) attributed to common shareholders during the period by
the weighted average number of shares of common stock that would have been outstanding assuming the issuance of dilutive
potential common stock as if outstanding during the reporting period, net of shares assumed
to be repurchased using the treasury stock method. The dilutive effect of stock options and
performance units is based on the treasury stock method. The dilutive effect of non-vested
restricted stock awards is based on the more dilutive of the treasury stock method or the
two-class method assuming a reallocation of undistributed earnings to common shareholders
after considering the dilutive effect of potential common shares other than the non-vested
shares of restricted stock.We retrospectively implemented new accounting guidance on January 1, 2009 which addresses
whether instruments granted in share-based payment transactions are participating securities
prior to vesting and, therefore, need to participate in computing earnings per share under
the two-class method. Our non-vested restricted stock awards contain nonforfeitable rights
to dividends and consequently are included in the computation of earnings per share under
the two-class method. For the three months ended September 30, 2008, 1.1 million non-vested
restricted shares were considered participating securities resulting in no impact in either
basic or diluted earnings per share.
 18




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##### Table of Contents



For the nine months ended September 30, 2008, 1.3 million non-vested restricted shares were
considered participating securities resulting in no impact in either basic or diluted
earnings per share. For the three months ended September 30, 2009, 1.2 million non-vested
restricted shares participated in the net income reported for that period resulting in no
impact in either basic or diluted earnings per share. For the nine months ended September
30, 2009, 1.3 million non-vested restricted shares participated in net income reported for
that period resulting in a reduction in basic earnings per share of $0.01 and no impact in
diluted earnings per share.The following table presents information necessary to calculate earnings (loss) per share of
common stock for the three and nine months ended September 30, 2009 and 2008.
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302009
    
    
    2008
    
    
    2009
    
    
    2008(In thousands, except per share data)Basic EPS:Net income (loss)
    
    $
    14,018
    
    
    $
    (103,108
    )
    
    $
    78,982
    
    
    $
    (91,130
    )Less earnings attributed to shareholders
of non-vested restricted stock
    
    
    (144
    )
    
    
    
    
    
    
    (871
    )
    
    
    Earnings (loss) attributed to common
shareholders
    
    $
    13,874
    
    
    $
    (103,108
    )
    
    $
    78,111
    
    
    $
    (91,130
    )Weighted-average number of common shares
outstanding  basic
    
    
    112,693
    
    
    
    114,493
    
    
    
    112,550
    
    
    
    114,135Basic earnings (loss) per common share
    
    $
    0.12
    
    
    $
    (0.90
    )
    
    $
    0.69
    
    
    $
    (0.80
    )Diluted EPS:Earnings (loss) attributable to common
shareholders-basic
    
    $
    13,874
    
    
    $
    (103,108
    )
    
    $
    78,111
    
    
    $
    (91,130
    )Adjustment to earnings (loss) attributable
to common shareholders for redistribution
to shareholders of non-vested restricted
stock
    
    
    
    
    
    
    
    
    
    
    5
    
    
    
    Adjusted earnings (loss) attributable to
common shareholders-diluted
    
    $
    13,874
    
    
    $
    (103,108
    )
    
    $
    78,116
    
    
    $
    (91,130
    )Weighted-average number of common shares
outstanding  basic
    
    
    112,693
    
    
    
    114,493
    
    
    
    112,550
    
    
    
    114,135Dilutive effect of potential common shares:Stock options
    
    
    41
    
    
    
    
    
    
    
    24
    
    
    
    Performance units
    
    
    544
    
    
    
    
    
    
    
    544
    
    
    
    Weighted-average number of common shares
outstanding  diluted
    
    
    113,278
    
    
    
    114,493
    
    
    
    113,118
    
    
    
    114,135Diluted net income (loss) per common share
    
    $
    0.12
    
    
    $
    (0.90
    )
    
    $
    0.69
    
    
    $
    (0.80
    )
 Anti-dilutive shares primarily represent options where the strike price was in excess of the
average market price of our common stock for the period reported and are excluded from the
computation of diluted earnings per share. Excluded anti-dilutive shares totaled 1.7
million and 2.5 million for the three months ended September 30, 2009 and 2008,
respectively. Excluded anti-dilutive shares totaled 1.8 million and 2.5 million for the
nine months ended September 30, 2009 and 2008, respectively.The net settlement premium obligation on the Senior Convertible Debentures, issued in July
2007, was not included in the dilutive earnings per share calculation for the three or nine
months ended September 30, 2009 and 2008 because the conversion price of the debentures was
in excess of our common stock price.
 
 19




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##### Table of Contents



17.
    
    Segment Information
 The following table presents information about the profit (or loss) for the three and nine
months ended September 30, 2009 and 2008 of each of our six reportable segments: North
America Offshore Construction Division (OCD), North America Subsea, Latin America, West
Africa, Middle East (including the Mediterranean), and Asia Pacific/India.As of the date of this Quarterly Report, we have no active projects in West Africa and have
curtailed our operations in the region. We continue, however, to evaluate viable and
profitable projects in the area.Also, during the first quarter of 2009, we discontinued allocation of corporate stewardship
costs to our reportable segments. This change has been reflected as a retrospective change
to the financial information for the three and nine months ended September 30, 2008
presented below. This change did not affect our Condensed Consolidated Balance Sheets,
Condensed Consolidated Statements of Operations or Condensed Consolidated Statements of Cash
Flows.
 Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 302009
    
    
    2008
    
    
    2009
    
    
    2008(In thousands)Total segment revenuesNorth America OCD
    
    $
    60,011
    
    
    $
    28,868
    
    
    $
    108,961
    
    
    $
    58,440North America Subsea
    
    
    46,343
    
    
    
    43,422
    
    
    
    112,093
    
    
    
    103,122Latin America
    
    
    35,749
    
    
    
    59,509
    
    
    
    185,534
    
    
    
    185,259West Africa
    
    
    (529
    )
    
    
    22,924
    
    
    
    101,039
    
    
    
    140,664Middle East
    
    
    28,668
    
    
    
    35,638
    
    
    
    82,167
    
    
    
    188,085Asia Pacific/India
    
    
    47,433
    
    
    
    40,423
    
    
    
    206,880
    
    
    
    172,317Subtotal
    
    
    217,675
    
    
    
    230,784
    
    
    
    796,674
    
    
    
    847,887Intersegment eliminationsNorth America Subsea
    
    
    (13,957
    )
    
    
    (10,159
    )
    
    
    (25,394
    )
    
    
    (23,187
    )Latin America
    
    
    
    
    
    
    (2,074
    )
    
    
    
    
    
    
    (2,074
    )Middle East
    
    
    
    
    
    
    
    
    
    
    (3,270
    )
    
    
    (2,067
    )Subtotal
    
    
    (13,957
    )
    
    
    (12,233
    )
    
    
    (28,664
    )
    
    
    (27,328
    )Consolidated revenues
    
    $
    203,718
    
    
    $
    218,551
    
    
    $
    768,010
    
    
    $
    820,559Income (loss) before taxesNorth America OCD
    
    $
    12,903
    
    
    $
    (5,961
    )
    
    $
    4,924
    
    
    $
    (11,873
    )North America Subsea
    
    
    10,267
    
    
    
    522
    
    
    
    25,972
    
    
    
    6,906Latin America
    
    
    (10,642
    )
    
    
    (19,648
    )
    
    
    11,825
    
    
    
    (12,132
    )West Africa
    
    
    (2,709
    )
    
    
    (10,103
    )
    
    
    30,150
    
    
    
    (19,387
    )Middle East
    
    
    6,337
    
    
    
    (83,273
    )
    
    
    15,913
    
    
    
    (73,768
    )Asia Pacific/India
    
    
    9,333
    
    
    
    10,805
    
    
    
    34,351
    
    
    
    35,317Corporate
    
    
    (7,320
    )
    
    
    (10,679
    )
    
    
    (21,925
    )
    
    
    (26,557
    )Consolidated income (loss) before taxes
    
    $
    18,169
    
    
    $
    (118,337
    )
    
    $
    101,210
    
    
    $
    (101,494
    )
 20




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##### Table of Contents



The following table presents information about the assets of each of our reportable segments
as of September 30, 2009 and December 31, 2008.
 September 30
    
    
    December 312009
    
    
    2008(In thousands)Segment assets at period endNorth America OCD
    
    $
    166,951
    
    
    $
    39,184North America Subsea
    
    
    175,729
    
    
    
    191,866Latin America
    
    
    247,924
    
    
    
    254,007West Africa
    
    
    78,619
    
    
    
    214,748Middle East
    
    
    89,163
    
    
    
    117,997Asia Pacific/India
    
    
    218,080
    
    
    
    173,613Corporate
    
    
    589,834
    
    
    
    497,938Consolidated segment assets
at period end
    
    $
    1,566,300
    
    
    $
    1,489,353
 21




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##### Table of Contents



Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations.
 Forward-Looking Statements
    
    
    the level of capital expenditures in the oil and gas industry;
    
    risks inherent in doing business abroad;
    
    operating hazards related to working offshore;
    
    dependence on significant customers;
    
    ability to attract and retain skilled workers;
    
    general economic and business conditions and industry trends;
    
    environmental matters;
    
    changes in laws and regulations;
    
    the effects of resolving claims and variation orders;
    
    adverse outcomes from legal and regulatory proceedings;
    
    availability of capital resources;
    
    delays or cancellation of projects included in backlog;
    
    fluctuations in the prices of or demand for oil and gas;
    
    our ability to comply with covenants in our credit agreements and other debt
instruments and availability, terms and deployment of capital
    
    the level of offshore drilling activity; and
    
    foreign exchange, currency, and interest rate fluctuations.
  22




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##### Table of Contents



Results of Operations
 General
   
    
    Offshore Construction Services, which include pipeline construction, platform
installation and removal, project management and construction support services; and
    
    Subsea Services, which include diving, diver-less intervention, SURF (subsea
equipment, umbilical, riser, and flow line), IRM (inspection, repairs, and maintenance),
and decommissioning/plug and abandonment services.
  Offshore Construction Services
   23




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##### Table of Contents



Subsea Services
  Quarter Ended September 30, 2009 Compared to Quarter Ended September 30, 2008
 Three months ended September 302009
    
    
    2008% of
    
    
    
    
    
    
    % of
    
    
    % Change(Thousands)
    
    
    Revenue
    
    
    (Thousands)
    
    
    Revenue
    
    
    (Unfavorable)Revenues
    
    $
    203,718
    
    
    
    100.0
    %
    
    $
    218,551
    
    
    
    100.0
    %
    
    
    (6.8
    %)Cost of operations
    
    
    163,855
    
    
    
    80.4
    
    
    
    307,409
    
    
    
    140.7
    
    
    
    46.7Gross profit
    
    
    39,863
    
    
    
    19.6
    
    
    
    (88,858
    )
    
    
    40.7
    
    
    
    144.9(Gain) loss on asset disposals and impairments
    
    
    274
    
    
    
    0.1
    
    
    
    1,640
    
    
    
    0.7
    
    
    
    83.3Selling, general and administrative expenses
    
    
    19,075
    
    
    
    9.4
    
    
    
    25,439
    
    
    
    11.6
    
    
    
    25.0Operating income (loss)
    
    
    20,514
    
    
    
    10.1
    
    
    
    (115,937
    )
    
    
    53.0
    
    
    
    117.7Interest income
    
    
    402
    
    
    
    0.2
    
    
    
    2,476
    
    
    
    1.1
    
    
    
    (83.8
    )Interest expense
    
    
    (2,756
    )
    
    
    1.4
    
    
    
    (4,642
    )
    
    
    2.2
    
    
    
    40.6Other income (expense), net
    
    
    9
    
    
    
    
    
    
    
    (234
    )
    
    
    0.1
    
    
    
    103.8Income (loss) before income taxes
    
    
    18,169
    
    
    
    8.9
    
    
    
    (118,337
    )
    
    
    54.2
    
    
    
    115.4Income tax expense (benefits)
    
    
    4,151
    
    
    
    2.0
    
    
    
    (15,229
    )
    
    
    7.0
    
    
    
    (127.3
    )Net income (loss)
    
    $
    14,018
    
    
    
    6.9
    %
    
    $
    (103,108
    )
    
    
    47.2
    %
    
    
    113.6
    %
 Revenues
 Gross Profit DLB264 Subtec 1
 (Gain) loss on Asset Disposals and Impairments Sea Puma
 Selling, General and Administrative Expenses
 Interest Income 
 24




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Interest Expense  Global 1200 Global 1201
 Other Income (Expense), net 
 Income Taxes 
 Segment Information 
 North America Offshore Construction Division
 Cherokee Hercules Sea Constructor Titan II, GP37 Cherokee
 North America Subsea
 Global
Orion Olympic Challenger, Sea Lion Global Orion
 Latin America
  25




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##### Table of Contents



West Africa
 Hercules Sea
Constructor Sea Puma
 Middle East
 DLB264 Subtec I
 Asia Pacific/India
 DLB264 Seminole Subtec 1
 Corporate
  26




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##### Table of Contents



Nine Months Ended September 30, 2009 Compared to Nine Months Ended September 30, 2008
 Nine months ended September 302009
    
    
    2008% of
    
    
    
    
    
    
    % of
    
    
    % Change(Thousands)
    
    
    Revenue
    
    
    (Thousands)
    
    
    Revenue
    
    
    (Unfavorable)Revenues
    
    $
    768,010
    
    
    
    100.0
    %
    
    $
    820,559
    
    
    
    100.0
    %
    
    
    (6.4
    %)Cost of operations
    
    
    617,609
    
    
    
    80.4
    
    
    
    847,251
    
    
    
    103.3
    
    
    
    27.1Gross profit
    
    
    150,401
    
    
    
    19.6
    
    
    
    (26,692
    )
    
    
    3.3
    
    
    
    663.5(Gain) loss on asset disposals and impairments
    
    
    (8,249
    )
    
    
    1.0
    
    
    
    (372
    )
    
    
    
    
    
    
    n/mSelling, general and administrative expenses
    
    
    55,635
    
    
    
    7.2
    
    
    
    73,439
    
    
    
    8.9
    
    
    
    24.2Operating income (loss)
    
    
    103,015
    
    
    
    13.4
    
    
    
    (99,759
    )
    
    
    12.2
    
    
    
    203.3Interest income
    
    
    1,594
    
    
    
    0.2
    
    
    
    12,709
    
    
    
    1.5
    
    
    
    (87.5
    )Interest expense
    
    
    (9,978
    )
    
    
    1.3
    
    
    
    (12,578
    )
    
    
    1.5
    
    
    
    20.7Other income (expense), net
    
    
    6,579
    
    
    
    0.9
    
    
    
    (1,866
    )
    
    
    0.2
    
    
    
    452.6Income (loss) before income taxes
    
    
    101,210
    
    
    
    13.2
    
    
    
    (101,494
    )
    
    
    12.4
    
    
    
    199.7Income taxes
    
    
    22,228
    
    
    
    2.9
    
    
    
    (10,364
    )
    
    
    1.3
    
    
    
    (314.5
    )Net income
    
    $
    78,982
    
    
    
    10.3
    %
    
    $
    (91,130
    )
    
    
    11.1
    %
    
    
    186.7
    %
 Revenues
 Gross Profit Hercules
 Gain on Asset Disposals and Impairments Seminole Sea Lion Sea Lion Tonkawa Sea Puma CB 3 Power
Barge 1 GP37 Sea Puma
 Selling, General and Administrative Expenses 
 Interest Income 
 27




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##### Table of Contents



Interest Expense  Global 1200 Global 1201
 Other Income (Expense), net 
 Income Taxes 
 Segment Information 
 North America Offshore Construction Division
 Hercules Sea Constructor Cherokee, Chickasaw, GP37, Titan II Cherokee
 North America Subsea
 Olympic Challenger, Pioneer, Global Orion, REM Commander Sea Lion Sea Lion Olympic Challenger REM Commander
 28




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##### Table of Contents



Latin America
 REM Commander
 West Africa
 Hercules Sea Constructor Sea Puma CB3 Power Barge 1,
 Middle East
 Tonkawa Subtec 1
 Asia Pacific/India
 Seminole
 29




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##### Table of Contents



Corporate
 Global 1200 Global 1201,
 Utilization of Major Construction Vessels
 Industry and Business Outlook
    Liquidity and Capital Resources
 Cash Flow
   30




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##### Table of Contents



Contractual Obligations
 Global 1200 Global 1201
 Less than 1 year
    
    $
    206,3801 to 3 years
    
    
    71,517Total
    
    $
    277,897
 Liquidity Risk
  
    
    temporarily cash-collateralize letters of credit and bank guarantees;
    
    temporarily waive compliance with certain financial covenants;
    
    temporarily prohibit share repurchases; and
    
    temporarily maintain unencumbered liquidity of $100 million.
   
    
    allow for a new starting point in measuring financial performance; and
    
    permit borrowings and the issuance of letters of credit and bank guarantees based on a
rate premium over prime rate ranging from 1.50% to 3.00% or London Interbank Offered Rate
ranging from 2.00% to 3.50% based upon certain financial ratios.
  31




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##### Table of Contents



Liquidity Outlook
  Global 1200 Global 1201
  32




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk.
  Interest Rate Risk
  Foreign Currency Risk
  
 Global 1200
 33




---



##### Table of Contents



Item 4. Controls and Procedures.
   34




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##### Table of Contents



PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings.
     
 Item 1A. Risk Factors.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
  Purchases of Equity Securities.
  Total Number
    
    Maximumof Shares
    
    Number ofPurchased as
    
    Shares thatPart of Publicly
    
    May Yet BeTotal Number
    
    Average
    
    Announced
    
    Purchasedof Shares
    
    Price Paid
    
    Plans or
    
    Under the PlansPeriod
    
    Purchased(1)
    
    per Share
    
    Programs
    
    or ProgramsJuly 1, 2009 - July 31, 2009
    
    
    327
    
    
    $
    6.99
    
    
    
    
    
    
    
    August 1, 2009 - August 31, 2009
    
    
    8,208
    
    
    
    7.53
    
    
    
    
    
    
    
    September 1, 2009 - September
30, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    8,535
    
    
    $
    7.51
    
    
    
    
    
    
    
    
 
 (1)
    
    Represents the surrender of shares of common stock to satisfy payments for
withholding taxes in connection with the vesting of restricted stock issued to employees under
shareholder approved equity incentive plans. 35




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##### Table of Contents



Item 6. Exhibits.
 3.1 -
    
    Amended and Restated Articles of Incorporation of
Registrant as amended, incorporated by reference to
Exhibits 3.1 and 3.3 to the Form S-1 Registration
Statement filed by the Registrant (Reg. No 33-56600).3.2 -
    
    Bylaws of Registrant, as amended through October 31, 2007,
incorporated by reference to Exhibit 3.2 to the
Registrants Form 10-K filed March 2, 2009.*
    
    15.1 -
    
    Letter regarding unaudited interim financial information.*
    
    31.1 -
    
    Section 302 Certification of CEO, John A. Clerico*
    
    31.2 -
    
    Section 302 Certification of CFO, Jeffrey B. Levos**
    
    32.1 -
    
    Section 906 Certification of CEO, John A. Clerico**
    
    32.2 -
    
    Section 906 Certification of CFO, Jeffrey B. Levos*
    
    Included with this filing**
    
    Furnished herewith
 36




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##### Table of Contents



Signatures
  GLOBAL INDUSTRIES, LTD.By:
    
    /s/ Jeffrey B. Levos

Jeffrey B. LevosSenior Vice President andChief Financial Officer(Principal Financial Officer)By:
    
    /s/ Trudy P. McConnaughhay

Trudy P. McConnaughhayCorporate Controller(Principal Accounting Officer)
  37