<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

     ----------------------------------------------------------------------

(Mark One)
(X)          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                  THE SECURITIES EXCHANGE ACT OF 1934

                 FOR THE QUARTERLY PERIOD ENDED OCTOBER 31, 2001

( )           TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                        COMMISSION FILE NUMBER 000-25142

     ----------------------------------------------------------------------

                            MITCHAM INDUSTRIES, INC.
                (Name of registrant as specified in its charter)


            TEXAS                                              76-0210849
(State or other jurisdiction of                             (I.R.S. Employer
 incorporation or organization)                            Identification No.)

                             44000 HIGHWAY 75 SOUTH
                             HUNTSVILLE, TEXAS 77340
                    (Address of principal executive offices)

                                 (936) 291-2277
              (Registrant's telephone number, including area code)

     ----------------------------------------------------------------------

    Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X    No
                                             ---     ---
    Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 8,779,801 shares of Common
Stock, $0.01 par value, were outstanding as of December 12, 2001.


<PAGE>


                            MITCHAM INDUSTRIES, INC.
                                      INDEX


                          PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements

            Condensed Consolidated Balance Sheets...........................   3
            Condensed Consolidated Statements of Operations.................   4
            Condensed Consolidated Statements of Cash Flows.................   5
            Notes to Condensed Consolidated Financial Statements............   6

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations..........................................   7

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.........   9

                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings..................................................  12

Item 6.  Exhibits and Reports on Form 8-K...................................  12

         Signatures.........................................................  13

                                       2

<PAGE>


PART I.  FINANCIAL INFORMATION
ITEM 1.  FINANCIAL STATEMENTS


                            MITCHAM INDUSTRIES, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)

<Table>
<Caption>
                                                                         October 31,   January 31,
                             ASSETS                                         2001         2001
                             ------                                     ------------   -----------
                                                                        (Unaudited)
<S>                                                                       <C>           <C>
CURRENT ASSETS:
    Cash                                                                  $  9,913      $  4,317
    Marketable securities, at market                                            --         7,085
    Accounts receivable, net                                                 7,585         5,742
    Notes receivable                                                         1,028         1,470
    Income tax receivable                                                       --           787
    Deferred tax asset                                                         984         2,067
    Prepaid expenses and other current assets                                  516           458
                                                                          --------      --------
         Total current assets                                               20,026        21,926
Seismic equipment lease pool, property and equipment                        85,044        91,435
Accumulated depreciation of seismic equipment lease pool,
      property and equipment                                               (43,657)      (42,380)
Notes receivable                                                               517           610
Deferred tax asset                                                             822           646
Other assets                                                                   387           324
                                                                          --------      --------
         Total assets                                                     $ 63,139      $ 72,561
                                                                          ========      ========

            LIABILITIES AND SHAREHOLDERS' EQUITY
            ------------------------------------

CURRENT LIABILITIES:
    Accounts payable                                                      $  2,412      $  8,259
    Customer deposits                                                           38           503
    Accrued wages                                                              232           236
    Current maturities - long-term debt                                      2,254         1,856
    Deferred revenue                                                           750           947
    Accrued lawsuit settlement liability                                        --         1,202
    Income taxes payable                                                        53            --
    Accrued expenses and other current liabilities                             364           126
                                                                          --------      --------
         Total current liabilities                                           6,103        13,129
Long-term debt                                                               4,847         5,444
                                                                          --------      --------
         Total liabilities                                                  10,950        18,573

SHAREHOLDERS' EQUITY:
    Preferred stock, $1.00 par value; 1,000,000 shares authorized;
        none issued and outstanding                                             --            --
    Common stock, $0.01 par value; 20,000,000 shares authorized;
        9,657,801 and 9,591,112 shares, respectively, issued                    97            96
    Additional paid-in capital                                              61,814        61,601
    Treasury stock, at cost, 851,100 and 240,100 shares, respectively       (4,414)       (3,195)
    Accumulated deficit                                                     (2,850)       (3,566)
    Accumulated other comprehensive loss                                    (2,458)         (948)
                                                                          --------      --------
         Total shareholders' equity                                         52,189        53,988
                                                                          --------      --------
         Total liabilities and shareholders' equity                       $ 63,139      $ 72,561
                                                                          ========      ========
</Table>

              THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE
                  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

                                       3
<PAGE>


                            MITCHAM INDUSTRIES, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                 (IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
                                   (UNAUDITED)

<Table>
<Caption>
                                                    THREE MONTHS ENDED         NINE MONTHS ENDED
                                                        OCTOBER 31,                OCTOBER 31,
                                                 -----------------------     -----------------------
                                                    2001          2000          2001          2000
                                                 ---------     ---------     ---------     ---------
<S>                                             <C>            <C>           <C>           <C>
REVENUES:
Short-term leasing                               $   4,722     $   2,545     $  14,946     $   7,733
Leasing under lease/purchase agreements                514           202         2,084           570
Equipment sales and other                            2,434         1,006         5,780         3,755
                                                 ---------     ---------     ---------     ---------
         Total revenues                              7,670         3,753        22,810        12,058

COSTS AND EXPENSES:
Direct costs                                           435           347         1,577         1,120
Cost of other equipment sales                        1,858           851         3,760         2,659
General and administrative                           1,077         1,078         3,229         3,121
Provision for doubtful accounts                         50            25           125           100
Depreciation                                         3,912         3,268        12,309         9,260
                                                 ---------     ---------     ---------     ---------
         Total costs and expenses                    7,332         5,569        21,000        16,260
                                                 ---------     ---------     ---------     ---------

OPERATING INCOME (LOSS)                                338        (1,816)        1,810        (4,202)

Other income (expense) - net                           (28)          162          (175)          478
                                                 ---------     ---------     ---------     ---------

INCOME (LOSS) BEFORE INCOME TAXES                      310        (1,654)        1,635        (3,724)
PROVISION (BENEFIT) FOR INCOME TAXES                   421            --           919          (327)
                                                 ---------     ---------     ---------     ---------
NET INCOME (LOSS)                                $    (111)    $  (1,654)    $     716     $  (3,397)
                                                 =========     =========     =========     =========

Earnings (loss) per common share:

     Basic                                       $   (0.01)    $   (0.18)    $    0.08     $   (0.37)
     Diluted                                     $   (0.01)    $   (0.18)    $    0.08     $   (0.37)
                                                 =========     =========     =========     =========

Shares used in computing earnings (loss) per
common share:

     Basic                                       8,871,000     9,032,000     8,902,000     9,220,000
     Dilutive effect of common stock
     equivalents                                        --            --       165,000            --
                                                 ---------     ---------     ---------     ---------
     Diluted                                     8,871,000     9,032,000     9,067,000     9,220,000
                                                 =========     =========     =========     =========
</Table>

              THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE
                  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

                                      4
<PAGE>




                            MITCHAM INDUSTRIES, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

<Table>
<Caption>
                                                                   NINE MONTHS ENDED
                                                                       OCTOBER 31,
                                                                 -----------------------
                                                                    2001          2000
                                                                 ---------     ---------
<S>                                                             <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                                                $     716     $  (3,397)
Adjustments to reconcile net income (loss) to net cash flows
       provided by operating activities:
         Depreciation                                               12,309         9,260
         Provision for doubtful accounts, net of charge offs           (49)         (108)
         Accounts receivable                                        (1,571)          947
         Federal income taxes                                        1,747          (313)
         Accounts payable and other current liabilities             (7,897)         (676)
         Other assets                                                 (122)         (295)
                                                                 ---------     ---------
              Net cash provided by operating activities              5,133         5,418

CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchases of seismic equipment held for lease                  (8,722)      (12,632)
     Purchases of property and equipment                               (46)         (179)
     Sale of marketable securities, net                              7,085         5,852
     Disposal of lease pool equipment                                3,349         1,536
                                                                 ---------     ---------
         Net cash provided by (used in) investing activities         1,666        (5,423)

CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from long-term borrowings                              1,200            --
     Payments on short-term borrowings                              (1,399)           --
     Proceeds from issuance of common stock upon exercise of
        warrants and options                                           214           142
     Purchases of common stock for treasury                         (1,218)       (2,932)
                                                                 ---------     ---------
         Net cash used in financing activities                      (1,203)       (2,790)
                                                                 ---------     ---------

NET CHANGE IN CASH                                                   5,596        (2,795)
CASH, BEGINNING OF PERIOD                                            4,317         3,588
                                                                 ---------     ---------
CASH, END OF PERIOD                                              $   9,913     $     793
                                                                 =========     =========

SUPPLEMENTAL CASH FLOW INFORMATION:
     Cash paid for:
         Interest                                                $     435     $      --
         Income taxes                                            $      --     $      --
                                                                 =========     =========
</Table>

              THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE
                  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

                                       5
<PAGE>


                            MITCHAM INDUSTRIES, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.       BASIS OF PRESENTATION

         The condensed consolidated financial statements of Mitcham Industries,
         Inc. ("the Company") have been prepared by the Company, without audit,
         pursuant to the rules and regulations of the Securities and Exchange
         Commission. Certain information and footnote disclosures normally
         included in financial statements prepared in accordance with generally
         accepted accounting principles have been condensed or omitted pursuant
         to such rules and regulations, although the Company believes that the
         disclosures are adequate to make the information presented not
         misleading. These condensed consolidated financial statements should be
         read in conjunction with the financial statements and the notes thereto
         included in the Company's latest Annual Report to Shareholders and the
         Annual Report on Form 10-K for the year ended January 31, 2001. In the
         opinion of the Company, all adjustments, consisting only of normal
         recurring adjustments, necessary to present fairly the financial
         position as of October 31, 2001; the results of operations for the
         three and nine months ended October 31, 2001 and 2000; and cash flows
         for the nine months ended October 31, 2001 and 2000, have been
         included. The foregoing interim results are not necessarily indicative
         of the results of the operations for the full fiscal year ending
         January 31, 2002.

2.       COMMITMENTS AND CONTINGENCIES

         Legal Proceedings
         On or about April 23, 1998, several purported class action lawsuits
         were filed against the Company and its chief executive officer and then
         chief financial officer in the U.S. District Court for the Southern
         District of Texas, Houston Division. The first-filed complaint, styled
         Stanley Moskowitz ("Plaintiffs") v. Mitcham Industries, Inc., Billy F.
         Mitcham, Jr. and Roberto Rios ("Defendants"), alleged violations of
         Section 10(b), Rule 10b-5 and 20(a) of the Securities Exchange Act of
         1934 and Sections 11 and 12(a)(2) of the Securities Act of 1933. On or
         about September 21, 1998, the complaints were consolidated into one
         action. On November 4, 1998, the Plaintiffs filed a consolidated
         amended complaint ("CAC"), which sought class action status on behalf
         of purchasers of the Company's common stock from June 4, 1997 through
         March 26, 1998, and damages in an unspecified amount plus costs and
         attorney's fees. The CAC alleged that the Defendants made materially
         false and misleading statements and omissions in public filings and
         announcements concerning its business and its allowance for doubtful
         accounts. On September 28, 1999, the Court granted in part and denied
         in part the Defendants' motion to dismiss, and granted Plaintiffs leave
         to amend on certain claims. On December 8, 1999, Plaintiffs filed their
         second consolidated amended complaint ("SCAC"). On October 2, 2000, the
         Court granted in part and denied in part the Defendants' motions to
         dismiss the SCAC. On December 5, 2000, the Defendants answered and
         denied the allegations in the SCAC. On August 10, 2001, facing
         protracted and expensive litigation, Defendants executed a final
         settlement agreement with Plaintiffs for $2.7 million, paid by the
         Company and its insurance carrier. The lawsuit will be dismissed with
         prejudice upon approval by the Court.

         The Company is also involved in claims and legal actions arising in the
         ordinary course of business. In the opinion of management, the ultimate
         disposition of these matters will not have a material adverse effect on
         the Company's financial position, results of operations or liquidity.

3.       TREASURY STOCK

         In February 2000, the Board of Directors authorized the repurchase of
         up to 1,000,000 shares of the Company's common stock. On July 18, 2001,
         the Board of Directors increased the number of shares authorized to be
         repurchased to a total of up to 1,250,000 shares. The Company has
         repurchased 851,100 shares of its common stock at an average price of
         $5.19 per share as of October 31, 2001 and has classified these shares
         as treasury stock in the accompanying financial statements. The Company
         expects it will continue to purchase its shares from time to time in
         the open market or in privately negotiated purchase transactions as
         market and financial conditions warrant.

                                       6
<PAGE>


4.       RECLASSIFICATIONS

         Certain 2000 amounts have been reclassified to conform to 2001
         presentation.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

OVERVIEW

         The Company's sales are directly related to the level of worldwide oil
and gas exploration activities and the profitability and cash flows of oil and
gas companies and seismic contractors, which in turn are affected by
expectations regarding the supply and demand for oil and natural gas, energy
prices and finding and development costs. Over the last twelve months, the
seismic industry has begun to recover from the depressed levels of activity in
prior years.

         The Company leases and sells seismic data acquisition equipment
primarily to seismic data acquisition companies and oil and gas companies
conducting land and transition zone seismic surveys worldwide. The Company
provides short-term leasing of seismic equipment to meet a customer's
requirements and offers maintenance and support during the lease term. The
majority of all leases at October 31, 2001 were for a term of one year or less.
Seismic equipment held for lease is carried at cost, net of accumulated
depreciation.

SEASONALITY

         Historically, seismic equipment leasing has been susceptible to weather
patterns in certain geographic regions. There is some seasonality to the
Company's expected lease revenues, especially from customers operating in
Canada, where a significant percentage of seismic survey activity occurs in the
winter months, from October through March. During the months in which the
weather is warmer, certain areas are not accessible to trucks, earth vibrators
and other equipment because of the unstable terrain. This seasonal leasing
activity by the Company's Canadian customers has historically resulted in
increased lease revenues in the Company's first and fourth fiscal quarters.

RESULTS OF OPERATIONS

For the three months ended October 31, 2001 and 2000

         For the quarter ended October 31, 2001, total revenues increased by
$3.9 million to $7.7 million from $3.8 million in the corresponding period of
the prior year. This increase is attributable to a higher demand for rental
equipment as evidenced by the nearly $2.5 million increase in leasing revenues
as compared to the comparable quarter in the prior year. The prior year revenues
for the comparable quarter reflect a significant decrease in all categories of
revenues as compared to historical levels for the Company as a result of
decreased capital expenditure budgets throughout the oil and gas industry,
coupled with a decrease in customers exercising the purchase option of
lease/purchase contracts.

         Equipment sales and leasing revenues under lease/purchase agreements
during the quarter ended October 31, 2001 and 2000 were not significant, as the
Company recorded no revenues from the exercise of the purchase option of
lease/purchase contracts. During the quarter ended October 31, 2001, other
equipment sales generated a gross margin of 24% as compared to 15% for the same
period in 2000. Gross margins on equipment sales may vary significantly between
periods due to the mix of new versus older equipment being sold.

         General and administrative expenses of approximately $1.1 million
remained unchanged from the corresponding prior year period. During the quarter,
professional fees and insurance expenses increased, but were offset by decreases
in compensation and franchise tax expenses. Additionally, the Company incurred
personnel and related costs during 2001 associated with international marketing
efforts.

         Depreciation expense for the quarter ended October 31, 2001 increased
by $644,000, or 20%, to $3.9

                                       7

<PAGE>

million from $3.3 million for the same period last year. The increase is
primarily the result of capital additions to the seismic equipment lease pool
during the past year.

         The Company recorded a net loss for the quarter ended October 31, 2001
in the amount of $111,000 compared to a net loss of $1,654,000 for the same
period of the previous year.

For the nine months ended October 31, 2001 and 2000

         For the nine months ended October 31, 2001, total revenues increased by
$10.8 million to $22.8 million from $12.1 million in the corresponding period of
the prior year. Fiscal 2002 revenues through October 31, 2001 reflect a
significant increase in all categories of revenues compared to total revenues
for the same period of the prior year, mainly a reflection of the increased
seismic activity worldwide.

         Equipment sales and leasing revenues under lease/purchase agreements
during the nine months ended October 31, 2001 totaled $2.1 million. Comparable
amounts in the prior year were not significant, as the Company recorded no
revenues from the exercise of the purchase option of lease/purchase contracts.

         During the nine months ended October 31, 2001, other equipment sales
generated a gross margin of 35% as compared to 29% for the same period in 2000.
Gross margins on equipment sales may vary significantly between periods due to
the mix of new versus older equipment being sold.

         General and administrative expenses increased by $108,000 from the
corresponding prior year period primarily due to personnel and related costs
associated with international marketing efforts, an increase in insurance,
compensation expenses, computer expenses and professional fees partially offset
by a decrease in travel and business promotion expenses and franchise taxes.

         Depreciation expense for the nine months ended October 31, 2001
increased by $3.0 million, or 33%, to $12.3 million from $9.3 million for the
same period last year. The increase is primarily the result of a larger seismic
equipment lease pool, on a cost basis, as compared to October 31, 2000.
Additionally, the Company has sold older, more fully depreciated seismic
equipment during the past year and replaced it with newer equipment, thus
increasing depreciation expense. The Company's seismic equipment lease pool
increased by $5.5 million, on a cost basis, to $83.3 million at October 31,
2001, from $77.8 million at October 31, 2000.

         The Company recorded net income for the nine months ended October 31,
2001 in the amount of $716,000 compared to a net loss of $3,397,000 for the same
period of the previous year.

LIQUIDITY AND CAPITAL RESOURCES

         As of October 31, 2001, the Company had net working capital of
approximately $13.9 million as compared to net working capital of $8.8 million
at January 31, 2001. Historically, the Company's principal liquidity
requirements and uses of cash have been for capital expenditures and working
capital and our principal sources of cash have been cash flows from operations,
borrowings and issuances of equity securities. Net cash provided by operating
activities for the nine months ended October 31, 2001 was $5.1 million, as
compared to net cash provided by operating activities of $5.4 million for the
nine months ended October 31, 2000.

         At October 31, 2001, the Company had trade accounts receivable of $3.3
million that were more than 90 days past due. At October 31, 2001, the Company's
allowance for doubtful accounts was approximately $1.2 million, which management
believes is sufficient to cover any losses in its trade accounts receivable and
notes receivable.

         On November 10, 2000, the Company closed an $8.5 million term loan with
First Victoria National Bank. The loan amortizes over 48 months and bears
interest at the rate of prime plus one percent, adjusted daily. The first three
monthly payments were interest only, with the remaining 45 monthly payments
being interest and principal in the approximate amount of $229,000. As of
October 31, 2001, the balance on the loan was $7.1 million. The loan is

                                       8

<PAGE>

collateralized by the lease pool equipment purchased for the Company's fiscal
2001 winter capital expenditure program.

         Capital expenditures for the nine months ended October 31, 2001 totaled
approximately $8.8 million compared to capital expenditures of $12.8 million for
the corresponding period in the prior year. During the nine months ended October
31, 2001, the Company repurchased 234,800 shares of its common stock for an
aggregate cost of $1,218,000, or an average price of $5.19 per share. The
Company expects that its capital expenditure requirements for the fourth quarter
will be approximately $10.1 million. At the present time, management believes
that cash on hand and cash provided by future operations will be sufficient to
fund its anticipated capital and liquidity needs over the next twelve months.
However, should demand warrant, the Company may pursue additional borrowings to
fund capital expenditures.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         The Company operates internationally, giving rise to exposure to market
risks from changes in foreign exchange rates to the extent that transactions are
not denominated in U.S. dollars. The Company typically denominates the majority
of its lease and sales contracts in U.S. dollars to mitigate the exposure to
fluctuations in foreign currencies.

FORWARD-LOOKING STATEMENTS AND RISK FACTORS

     Certain information contained in this Quarterly Report on Form 10-Q
(including statements contained in Part I, Item 2. "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and in Part II, Item
1. "Legal Proceedings"), as well as other written and oral statements made or
incorporated by reference from time to time by the Company and its
representatives in other reports, filings with the Securities and Exchange
Commission, press releases, conferences, or otherwise, may be deemed to be
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934. This information includes, without limitation, statements
concerning the Company's future financial position and results of operations;
planned capital expenditures; business strategy and other plans for future
operations; the future mix of revenues and business; commitments and contingent
liabilities; and future demand for the Company's services and predicted
improvement in energy industry and seismic service industry conditions. Although
the Company believes that the expectations reflected in such forward-looking
statements are reasonable, it can give no assurance that such expectations will
prove to have been correct. When used in this report, the words "anticipate,"
"believe," "estimate," "expect," "may," and similar expressions, as they relate
to the Company and its management, identify forward-looking statements. The
actual results of future events described in such forward-looking statements
could differ materially from the results described in the forward-looking
statements due to the risks and uncertainties set forth below and elsewhere
within this Quarterly Report on Form 10-Q.

RECOVERY OF OIL AND GAS INDUSTRY AND RECENT INCREASED DEMAND FOR
SERVICES COULD BE SHORT-LIVED

     Demand for the Company's services depends on the level of spending by oil
and gas companies for exploration, production and development activities, as
well as on the number of crews conducting land and transition zone seismic data
acquisition worldwide, and especially in North America. Due to the significant
decrease in world oil prices in 1998, demand for the Company's services both in
Canada and worldwide declined dramatically in the fourth quarter of fiscal 1999
and remained at historically low levels throughout fiscal 2000, but began to
improve during fiscal 2001. Any future fluctuations in the price of oil and gas
in response to relatively minor changes in the supply and demand for oil and gas
will continue to have a major effect on exploration, production and development
activities and thus, on the demand for the Company's services.

LOSS OF SIGNIFICANT CUSTOMERS WILL ADVERSELY AFFECT THE COMPANY

     The Company typically leases and sells significant amounts of seismic
equipment to a relatively small number of customers, the composition of which
changes from year to year as leases are initiated and concluded and as
customers' equipment needs vary. Therefore, at any one time, a large portion of
the Company's revenues may be

                                       9
<PAGE>

derived from a limited number of customers. In the fiscal years ended January
31, 1999, 2000 and 2001, the single largest customer accounted for approximately
36%, 17% and 21%, respectively, of the Company's total revenues. Because the
Company's customer base is relatively small, the loss of one or more customers
for any reason could adversely affect the Company's results of operations.

SIGNIFICANT DEFAULTS OF PAST-DUE CUSTOMER ACCOUNTS WOULD ADVERSELY AFFECT THE
COMPANY'S RESULTS OF OPERATIONS

     The Company has approximately $9.1 million of customer accounts and notes
receivable at October 31, 2001, of which $3.3 million is over ninety days past
due. At October 31, 2001, the Company has an allowance of $1.2 million to cover
losses in its receivable balances. Significant payment defaults by its customers
in excess of the allowance would have a material adverse effect on the Company's
financial position and results of operations.

INTERNATIONAL ECONOMIC AND POLITICAL INSTABILITY COULD ADVERSELY AFFECT THE
COMPANY'S RESULTS OF OPERATIONS

       The Company's results of operations are dependent upon the current
political and economic climate of several international countries in which its
customers either operate or are located. International sources accounted for
approximately 93% of the Company's revenues in the fiscal year ended January 31,
2001, and 17% of international revenues were attributable to lease and sales
activities in South America. Since the majority of the Company's lease and sales
contracts with its customers are denominated in U.S. dollars, there is little
risk of loss from fluctuations in foreign currencies. However, the Company's
internationally-sourced revenues are still subject to the risk of currency
exchange controls (in which payment could not be made in U.S. dollars), taxation
policies, and appropriation, as well as to political turmoil, civil
disturbances, armed hostilities, and other hazards. While the Company's results
of operations have not been adversely affected by those risks to date, there is
no assurance its business and results of operations won't be adversely affected
in the future.

THE COMPANY MUST CONTINUALLY OBTAIN ADDITIONAL LEASE CONTRACTS

     The Company's seismic equipment leases typically have a term of three to
nine months and provide gross revenues that recover only a portion of the
Company's capital investment. The Company's ability to generate lease revenues
and profits is dependent on obtaining additional lease contracts after the
termination of an original lease. However, lessees are under no obligation to,
and frequently do not, continue to lease seismic equipment after the expiration
of a lease. Although the Company has been successful in obtaining additional
lease contracts with other lessees after the termination of the original leases,
there can be no assurance that it will continue to do so. The Company's failure
to obtain additional or extended leases beyond the initial term would have a
material adverse effect on its operations and financial condition.

DEPENDENCE ON KEY PERSONNEL

     The Company's success is dependent on, among other things, the services of
certain key personnel, including specifically Billy F. Mitcham, Jr., Chairman of
the Board, President and Chief Executive Officer of the Company. Mr. Mitcham's
employment agreement has an initial term through January 15, 2002, and is
automatically extended on a year-to-year basis until terminated by either party
giving 30 days notice prior to the end of the current term (subject to earlier
termination on certain stated events). The agreement prohibits Mr. Mitcham from
engaging in any business activities that are competitive with the Company's
business and from diverting any of the Company's customers to a competitor for
two years after the termination of his employment. The loss of the services of
Mr. Mitcham could have a material adverse effect on the Company. In particular,
the Exclusive Equipment Lease Agreement with Sercel is terminable at such time
as he is no longer employed by the Company in a senior management capacity.

                                       10
<PAGE>

THE COMPANY'S SEISMIC LEASE POOL IS SUBJECT TO TECHNOLOGICAL OBSOLESCENCE

     The Company has a substantial capital investment in seismic data
acquisition equipment. The development by manufacturers of seismic equipment of
newer technology systems or component parts that have significant competitive
advantages over seismic systems and component parts now in use could have an
adverse effect on the Company's ability to profitably lease and sell its
existing seismic equipment. Significant improvements in technology may also
require the Company to recognize an asset impairment charge to its lease pool
investment, and to correspondingly invest significant sums to upgrade or replace
its existing lease pool with newer-technology equipment demanded by its
customers.

     During the fiscal year ended January 31, 1999, the Company recorded a
pretax asset impairment charge of $15.1 million. The non-cash asset impairment
charge was recorded in accordance with SFAS No. 121, which requires that
long-lived assets and certain identifiable intangibles held and used by the
Company be reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of an asset may not be recoverable. The
severity as well as the duration of the recent oil and gas industry downturn was
such an event. The Company's review of its long-lived assets indicated that the
carrying value of certain of the Company's seismic equipment lease pool assets
was more than the estimated undiscounted future net cash flows. As such, under
SFAS No. 121, the Company wrote down those assets to their estimated fair market
value based on discounted cash flows using an effective rate of 8.0%. There can
be no assurance that the Company will not record asset impairment charges under
SFAS No. 121 in the future.

WEATHER CONDITIONS CAUSE SEASONAL RESULTS

     The first and fourth quarters of the Company's fiscal year have
historically accounted for a greater portion of the Company's revenues than do
the second and third quarters of its fiscal year. This seasonality in revenues
is primarily due to the increased seismic survey activity in Canada from October
through March, which affects the Company due to its significant Canadian
operations. This seasonal pattern may cause the Company's results of operations
to vary significantly from quarter to quarter. Accordingly, period-to-period
comparisons are not necessarily meaningful and should not be relied on as
indicative of future results.

DISRUPTION IN SUPPLIER RELATIONSHIPS COULD ADVERSELY AFFECT THE COMPANY

     The Company has and continues to rely on purchase agreements with Sercel.
To a lesser extent, the Company also relies on its suppliers for lease
referrals. The termination of these agreements for any reason could materially
adversely affect the Company's business. Any difficulty in obtaining seismic
equipment from suppliers could have a material adverse effect on the Company's
business, financial condition and results of operations.

COMPETITION

     Competition in the leasing of seismic equipment is fragmented, and the
Company is aware of several companies that engage in seismic equipment leasing.
The Company believes that its competitors, in general, do not have as extensive
a seismic equipment lease pool as does the Company. The Company also believes
that its competitors do not have similar exclusive lease referral agreements
with suppliers. Competition exists to a lesser extent from seismic data
acquisition contractors that may lease equipment that is temporarily idle.

     The Company has several competitors engaged in seismic equipment leasing
and sales, including seismic equipment manufacturers, companies providing
seismic surveys and oil and gas exploration companies that use seismic
equipment, many of which have substantially greater financial resources than the
Company. There are also several smaller competitors who, in the aggregate,
generate significant revenue from the sale of seismic survey equipment.
Pressures from existing or new competitors could adversely affect the Company's
business operations.

VOLATILE STOCK PRICES AND NO PAYMENT OF DIVIDENDS

        Due to current energy industry conditions, energy and energy service
company stock prices, including the

                                       11
<PAGE>

Company's stock price, have been extremely volatile. Such stock price volatility
could adversely affect the Company's business operations by, among other things,
impeding its ability to attract and retain qualified personnel and to obtain
additional financing if such financing is ever needed. The Company has
historically not paid dividends on its common stock and does not anticipate
paying dividends in the foreseeable future.

POSSIBLE ADVERSE EFFECT OF ANTI-TAKEOVER PROVISIONS; POTENTIAL ISSUANCE
OF PREFERRED STOCK

     Certain provisions of the Company's Articles of Incorporation and the Texas
Business Corporation Act may tend to delay, defer or prevent a potential
unsolicited offer or takeover attempt that is not approved by the Board of
Directors but that the Company's shareholders might consider to be in their best
interest, including an attempt that might result in shareholders receiving a
premium over the market price for their shares. Because the Board of Directors
is authorized to issue preferred stock with such preferences and rights as it
determines, it may afford the holders of any series of preferred stock
preferences, rights or voting powers superior to those of the holders of common
stock. Although the Company has no shares of preferred stock outstanding and no
present intention to issue any shares of its preferred stock, there can be no
assurance that the Company will not do so in the future.

LIMITATION ON DIRECTORS' LIABILITY

     The Company's Articles of Incorporation provide, as permitted by governing
Texas law, that a director of the Company shall not be personally liable to the
Company or its shareholders for monetary damages for breach of fiduciary duty as
a director, with certain exceptions. These provisions may discourage
shareholders from bringing suit against a director for breach of fiduciary duty
and may reduce the likelihood of derivative litigation brought by shareholders
on behalf of the Company against a director.

                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

        On or about April 23, 1998, several purported class action lawsuits were
        filed against the Company and its chief executive officer and then chief
        financial officer in the U.S. District Court for the Southern District
        of Texas, Houston Division. The first-filed complaint, styled Stanley
        Moskowitz ("Plaintiffs") v. Mitcham Industries, Inc., Billy F. Mitcham,
        Jr. and Roberto Rios ("Defendants"), alleged violations of Section
        10(b), Rule 10b-5 and 20(a) of the Securities Exchange Act of 1934 and
        Sections 11 and 12(a)(2) of the Securities Act of 1933. On or about
        September 21, 1998, the complaints were consolidated into one action. On
        November 4, 1998, the Plaintiffs filed a consolidated amended complaint
        ("CAC"), which sought class action status on behalf of purchasers of the
        Company's common stock from June 4, 1997 through March 26, 1998, and
        damages in an unspecified amount plus costs and attorney's fees. The CAC
        alleged that the Defendants made materially false and misleading
        statements and omissions in public filings and announcements concerning
        its business and its allowance for doubtful accounts. On September 28,
        1999, the Court granted in part and denied in part the Defendants'
        motion to dismiss, and granted Plaintiffs leave to amend on certain
        claims. On December 8, 1999, Plaintiffs filed their second consolidated
        amended complaint ("SCAC"). On October 2, 2000, the Court granted in
        part and denied in part the Defendants' motions to dismiss the SCAC. On
        December 5, 2000, the Defendants answered and denied the allegations in
        the SCAC. On August 10, 2001, facing protracted and expensive
        litigation, Defendants executed a final settlement agreement with
        Plaintiffs for $2.7 million, paid by the Company and its insurance
        carrier. The lawsuit will be dismissed with prejudice upon approval by
        the Court.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
    (a) REPORTS ON FORM 8-K
        During the quarter ended October 31, 2001, the Company filed a Current
        Report on Form 8-K to update the description of its common stock.

    (b) EXHIBITS
        None.

                                       12
<PAGE>


                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.




                                             MITCHAM INDUSTRIES, INC.




Date:  December 13, 2001                     /s/ CHRISTOPHER C. SIFFERT
                                             -----------------------------------
                                             CHRISTOPHER C. SIFFERT,
                                             CORPORATE CONTROLLER
                                             (AUTHORIZED OFFICER AND PRINCIPAL
                                             ACCOUNTING OFFICER)


                                       13