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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 March 31, 2007
 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: 001-33206
 
 
 CAL DIVE INTERNATIONAL, INC.
 (Exact name of registrant as specified in its charter)
 
 Delaware
    
    61-1500501(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)400 North Sam Houston Parkway, E., Suite 1000
    
    77060Houston, Texas
    
    (Zip Code)(Address of Principal Executive Offices)
 (281) 618-0400  Registrants telephone number, including area code:
 
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CAL DIVE INTERNATIONAL, INC.
 TABLE OF CONTENTS
 PagePART I  FINANCIAL INFORMATION
    
    
    1Item 1. Financial Statements
    
    
    1Condensed Consolidated and Combined Balance Sheets as of March 31, 2007 (unaudited) and December 31, 2006 (audited)
    
    
    1Condensed Consolidated and Combined Statements of Operations (unaudited) for the three months ended March 31, 2007 and 2006
    
    
    2Condensed Consolidated and Combined Statements of Cash Flows (unaudited) for the three months ended March 31, 2007 and 2006
    
    
    3Notes to Condensed Consolidated and Combined Financial Statements (unaudited)
    
    
    4Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    8Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    12Item 4. Controls and Procedures
    
    
    12PART II  OTHER INFORMATION
    
    
    13Item 1A. Risk Factors
    
    
    13Item 6. Exhibits
    
    
    13SIGNATURES
    
    
    14EXHIBIT INDEX
    
    
    15Post-Closing Employee Matters AgreementCertification of CEO Pursuant to Rule 13a-14(a)Certification of CFO Pursuant to Rule 13a-14(a)Certification of CEO & CFO Pursuant to Section 1350
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PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 Cal Dive International, Inc. and Subsidiaries
 
 Condensed Consolidated and Combined Balance Sheets
 (in thousands, except per share par value)
 March 31,
    
    
    December 31,2007
    
    
    2006(unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    14,809
    
    
    $
    22,655Accounts receivable -Trade, net of allowance for doubtful accounts of $45 and $169, respectively
    
    
    123,042
    
    
    
    93,748Unbilled revenue
    
    
    30,889
    
    
    
    33,869Net receivable from Helix
    
    
    
    
    
    
    1,626Deferred income taxes
    
    
    2,865
    
    
    
    1,869Assets held for sale
    
    
    
    
    
    
    698Notes receivable
    
    
    1,788
    
    
    
    3,008Other current assets
    
    
    6,508
    
    
    
    11,274Total current assets
    
    
    179,901
    
    
    
    168,747Property and equipment
    
    
    296,237
    
    
    
    293,929Less  Accumulated depreciation
    
    
    (77,402
    )
    
    
    (71,682
    )218,835
    
    
    
    222,247Other assets:Equity investment
    
    
    11,808
    
    
    
    10,871Goodwill
    
    
    26,802
    
    
    
    26,666Other assets, net
    
    
    28,648
    
    
    
    23,622Total assets
    
    $
    465,994
    
    
    $
    452,153LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    32,762
    
    
    $
    39,810Net payable to Helix
    
    
    243
    
    
    
    Accrued liabilities
    
    
    34,301
    
    
    
    19,004Total current liabilities
    
    
    67,306
    
    
    
    58,814Long-term debt
    
    
    172,000
    
    
    
    201,000Long-term payable to Helix
    
    
    9,710
    
    
    
    11,028Deferred income taxes
    
    
    26,615
    
    
    
    20,824Other long term liabilities
    
    
    1,732
    
    
    
    2,726Total liabilities
    
    
    277,363
    
    
    
    294,392Commitments and contingencies
    
    
    
    
    
    
    Stockholders equity:Common stock, 240,000 shares authorized, $0.01 par value,
Issued and outstanding: 84,328 and 84,298 shares, respectively
    
    
    843
    
    
    
    843Capital in excess of par value of common stock
    
    
    155,704
    
    
    
    154,898Retained earnings
    
    
    32,084
    
    
    
    2,020Total stockholders equity
    
    
    188,631
    
    
    
    157,761Total liabilities and stockholders equity
    
    $
    465,994
    
    
    $
    452,153




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Cal Dive International, Inc. and Subsidiaries
 
 Condensed Consolidated and Combined Statements of Operations (unaudited)
(in thousands, except per share amounts)
 Three Months Ended March 31,2007
    
    
    2006Net revenues
    
    $
    149,226
    
    
    $
    119,790Cost of sales
    
    
    91,274
    
    
    
    69,584Gross profit
    
    
    57,952
    
    
    
    50,206Gain on sale of assets
    
    
    7
    
    
    
    267Selling and administrative expenses
    
    
    9,655
    
    
    
    6,155Income from operations
    
    
    48,304
    
    
    
    44,318Equity in earnings of investment
    
    
    952
    
    
    
    2,833Net interest income (expense)
    
    
    (2,539
    )
    
    
    329Income before income taxes
    
    
    46,717
    
    
    
    47,480Provision for income taxes
    
    
    16,653
    
    
    
    16,706Net income
    
    $
    30,064
    
    
    $
    30,774Net earnings per common share:Basic and diluted net earnings per share
    
    $
    0.36
    
    
    $
    0.50Weighted average basic and diluted shares outstanding
    
    
    83,680
    
    
    
    61,507
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Cal Dive International, Inc. and Subsidiaries
 
 Condensed Consolidated and Combined Statements of Cash Flows (unaudited)
(in thousands)
 Three Months Ended March 31,2007
    
    
    2006Cash Flows From Operating Activities:Net income
    
    $
    30,064
    
    
    $
    30,774Adjustments to reconcile net income to net cash
provided by operating activities:Depreciation and amortization
    
    
    8,894
    
    
    
    5,083Stock compensation expense
    
    
    806
    
    
    
    304Equity in earnings of investment
    
    
    (937
    )
    
    
    (2,766
    )Deferred income taxes
    
    
    4,795
    
    
    
    105Gain on sale of assets
    
    
    (7
    )
    
    
    (267
    )Changes in operating assets and liabilities:Accounts receivable, net
    
    
    (24,689
    )
    
    
    (30,927
    )Assets held for sale
    
    
    698
    
    
    
    936Other current assets
    
    
    5,985
    
    
    
    408Accounts payable and accrued liabilities
    
    
    8,430
    
    
    
    1,495Other noncurrent, net
    
    
    (10,756
    )
    
    
    (2,329
    )Net cash provided by operating activities:
    
    
    23,283
    
    
    
    2,816Cash Flows From Investing Activities:Capital expenditures
    
    
    (2,146
    )
    
    
    (4,990
    )Acquisition of businesses
    
    
    
    
    
    
    (77,927
    )Proceeds from sales of property
    
    
    17
    
    
    
    1,530Net cash used in investing activities:
    
    
    (2,129
    )
    
    
    (81,387
    )Cash Flows From Financing Activities:Repayments on credit facility
    
    
    (29,000
    )
    
    
    Cash transfers from Helix for investing activities
    
    
    
    
    
    
    81,387Cash transfers to Helix from operating activities
    
    
    
    
    
    
    (2,608
    )Net cash provided by (used in) financing activities
    
    
    (29,000
    )
    
    
    78,779Net increase (decrease) in cash and cash equivalents
    
    
    (7,846
    )
    
    
    208Cash and cash equivalents:Balance, beginning of period
    
    
    22,655
    
    
    
    Balance, end of period
    
    $
    14,809
    
    
    $
    208
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Cal Dive International, Inc. and Subsidiaries
 
 Notes to Condensed Consolidated and Combined Financial Statements (unaudited)
 1. Preparation of Interim Financial Statements
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2. Related Party Transactions
         3. Accrued Liabilities
  March 31,
    
    
    December 31,2007
    
    
    2006Accrued payroll and related benefits
    
    $
    10,397
    
    
    $
    7,500Accrued insurance
    
    
    3,996
    
    
    
    3,367Insurance claims to be reimbursed
    
    
    2,509
    
    
    
    1,870Accrued income taxes payable
    
    
    12,708
    
    
    
    1,201Other
    
    
    4,691
    
    
    
    5,066Total accrued liabilities
    
    $
    34,301
    
    
    $
    19,004
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4. Equity Investment
  Witch Queen
 5. Long-term Debt
   6. Commitments and Contingencies
 Lease Commitments
  Insurance
  Litigation and Claims
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7. Stock-Based Compensation Plans
 Helix Plans
     Cal Dive Plans
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8. Business Segment Information
  9. Recently Issued Accounting Principles
   The Fair Value Option for Financial
Assets and Financial Liabilities
 
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Cautionary Statement for Purposes of the Safe Harbor Provisions of the Private Securities
Litigation Reform Act of 1995
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Overview
 Our Relationship with Helix
   Critical Accounting Estimates and Policies
  Recently Issued Accounting Principles
  The Fair Value Option for Financial
Assets and Financial Liabilities
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Results of Operations
 Comparison of Three Months Ended March 31, 2007 and 2006
 Revenues.
 Gross profit.
 Selling and administrative expenses.
 Net interest expense.
 Income taxes.
 Net income.
 Vessel Utilization
  Three Months Ended March 31,2007
    
    
    2006Number of
    
    
    Utilization
    
    
    Number of
    
    
    UtilizationVessels (1)
    
    
    (2)
    
    
    Vessels (1)
    
    
    (2)Saturation diving
    
    
    8
    
    
    
    93%
    
    
    
    6
    
    
    
    94%Surface and mixed gas diving
    
    
    15
    
    
    
    63%
    
    
    
    15
    
    
    
    97%Shallow water pipelay
    
    
    2
    
    
    
    96%
    
    
    
    2
    
    
    
    100%Entire fleet
    
    
    25
    
    
    
    75%
    
    
    
    23
    
    
    
    96%
 
 (1)
    
    As of the end of the period and excluding acquired vessels prior to their in-service
dates, vessels taken out of service prior to their disposition and vessels jointly owned with
a third party.
 (2)
    
    Effective vessel utilization is calculated by dividing the total number of days the
vessels generated revenues by the total number of days the vessels were available for
operation in each quarter and does not reflect acquired vessels prior to their in-service
dates, vessels in drydocking, vessels taken out of service for upgrades or prior to their
disposition and vessels jointly owned with a third party.
 Liquidity and Capital Resources
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Cash Flows
 Operating activities.
 Investing Activities.
 DLB801 Kestrel
 Financing activities.
 Capital Expenditures
  Revolving Credit Facility
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Contractual and Other Obligations
   Payments Due by PeriodLess than
    
    
    
    
    
    
    
    
    
    
    More thanTotal
    
    
    1 Year
    
    
    1-3 Years
    
    
    3-5 Years
    
    
    5 Years(in thousands)Payable to Helix
    
    $
    11,349
    
    
    $
    4,275
    
    
    $
    4,074
    
    
    $
    2,039
    
    
    $
    961Noncancelable operating leases and charters
    
    
    15,642
    
    
    
    12,098
    
    
    
    1,606
    
    
    
    679
    
    
    
    1,259Long-term debt
    
    
    172,000
    
    
    
    
    
    
    
    
    
    
    
    172,000
    
    
    
    Total cash obligations
    
    $
    198,991
    
    
    $
    16,373
    
    
    $
    5,680
    
    
    $
    174,718
    
    
    $
    2,220
 Off-Balance Sheet Arrangements
 ,
 
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
 Market Risk Management
  
 Item 4. Controls and Procedures
 Disclosure Controls and Procedures
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Changes in Internal Control Over Financial Reporting
  
 PART II  OTHER INFORMATION
 
 Item 1A. Risk Factors
  
 Item 6. Exhibits
  ExhibitNumber
    
    Exhibit Title3.1
    
    Amended and Restated Certificate of Incorporation of Cal Dive International, Inc.(1)3.2
    
    Amended and Restated Bylaws of Cal Dive International, Inc.(1)4.1
    
    Specimen Common Stock certificate of Cal Dive International, Inc.(2)10.1
    
    Post-Closing Employee Matters Agreement between Cal Dive International, Inc. and Helix Energy
Solutions Group, Inc.31.1
    
    Certification Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 by Quinn J.
Hébert, Chief Executive Officer31.2
    
    Certification Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 by G. Kregg
Lunsford, Chief Financial Officer32.1
    
    Section 1350 Certification by Chief Executive Officer and Chief Financial Officer
 
 (1)
    
    Incorporated by reference from the Companys Annual Report on Form 10-K for the
fiscal year ended December 31, 2006.(2)
    
    Incorporated by reference from the Companys Registration Statement on Form S-1
(Registration No. 333-134609) initially filed with the Commission on May 31, 2006, as amended. Items 1, 2, 3, 4 and 5 are not applicable and have been omitted.
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SIGNATURES
  CAL DIVE INTERNATIONAL, INC.By:
    
    /s/ Quinn J. HébertQuinn J. HébertPresident and Chief Executive OfficerBy:
    
    /s/ G. Kregg LunsfordG. Kregg LunsfordExecutive Vice President,Chief Financial Officer and Treasurer
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EXHIBIT INDEX
 ExhibitNumber
    
    Exhibit Title3.1
    
    Amended and Restated Certificate of Incorporation of Cal Dive International, Inc.(1)3.2
    
    Amended and Restated Bylaws of Cal Dive International, Inc.(1)4.1
    
    Specimen Common Stock certificate of Cal Dive International, Inc.(2)10.1
    
    Post-Closing Employee Matters Agreement between Cal Dive International, Inc. and Helix Energy
Solutions Group, Inc.31.1
    
    Certification Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 by Quinn J.
Hébert, Chief Executive Officer31.2
    
    Certification Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 by G. Kregg
Lunsford, Chief Financial Officer32.1
    
    Section 1350 Certification by Chief Executive Officer and Chief Financial Officer
 
 (1)
    
    Incorporated by reference from the Companys Annual Report on Form 10-K for the
fiscal year ended December 31, 2006.(2)
    
    Incorporated by reference from the Companys Registration Statement on Form S-1
(Registration No. 333-134609) initially filed with the Commission on May 31, 2006, as amended. 15