<Page>

     AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 15, 2002.

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

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549
                            ------------------------


                                  FORM 20-F/A


                    ANNUAL REPORT PURSUANT TO SECTION 13 OR
                  15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

                  FOR THE FISCAL YEAR ENDED NOVEMBER 30, 2001
                         COMMISSION FILE NUMBER 0-21742
                            ------------------------

                              STOLT OFFSHORE S.A.
             (Exact name of Registrant as specified in its charter)

                                   LUXEMBOURG
                (Jurisdiction of incorporation or organization)

                          C/O STOLT OFFSHORE M.S. LTD

                                 DOLPHIN HOUSE
                                 WINDMILL ROAD
                               SUNBURY-ON-THAMES
                           MIDDLESEX TW16 7HT ENGLAND
                    (Address of principal executive offices)
                            ------------------------

SECURITIES REGISTERED OR TO BE REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
                                      None

SECURITIES REGISTERED OR TO BE REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
                         Common Shares, $2.00 par value

 SECURITIES FOR WHICH THERE IS A REPORTING OBLIGATION PURSUANT TO SECTION 15(D)
                                  OF THE ACT:
                                      None
                            ------------------------

    INDICATE THE NUMBER OF OUTSTANDING SHARES OF EACH OF THE ISSUER'S CLASSES OF
CAPITAL OR COMMON STOCK AS OF THE CLOSE OF THE PERIOD COVERED BY THE ANNUAL
REPORT:

<Table>
<S>                                                           <C>
Common Shares, $2.00 par value..............................  70,228,536
Class B Shares, $2.00 par value.............................  34,000,000
</Table>

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

    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 by check mark which financial statement item the registrant has elected
                                   to follow.
                           Item 17 / /    Item 18 /X/

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--------------------------------------------------------------------------------
<Page>
                               TABLE OF CONTENTS


<Table>
<Caption>
                                                                           PAGE
                                                                           ----
<S>        <C>                                                           <C>
                                      PART I

ITEM 1.    Identity of Directors, Senior Management and Advisers.......      2

ITEM 2.    Offer Statistics and Expected Timetable.....................      2

ITEM 3.    Key Information.............................................      2

           Selected Financial Data.....................................      2

           Risk Factors................................................      4

           Other Matters...............................................      9

ITEM 4.    Information on the Company..................................     10

           Overview....................................................     10

           History and Development of Stolt Offshore...................     12

           Capital Expenditures........................................     13

           Business Segments...........................................     13

           Market, Sales and Competition...............................     16

           Seasonality.................................................     16

           Supplies and Raw Materials..................................     17

           Intellectual Property.......................................     17

           Research and Development....................................     17

           Other Matters...............................................     18

           Significant Subsidiaries....................................     20

           Description of Property.....................................     21

ITEM 5.    Operating and Financial Review and Prospects................     23

           Recent Developments.........................................     37

ITEM 6.    Directors, Senior Management and Employees..................     37

           Directors and Senior Management.............................     37

           Compensation of Directors and Officers......................     39

           Incentive Plans.............................................     39

           Board Practices.............................................     39

           Employees...................................................     40

           Share Ownership.............................................     40

ITEM 7.    Major Shareholders and Related Party Transactions...........     42

           Relationship with SNSA......................................     43

           Other Related Party Transactions............................     44

ITEM 8.    Financial Information.......................................     44

           Legal Proceedings...........................................     44

           Dividend Policy.............................................     45

           Significant Changes.........................................     45

ITEM 9.    The Offer and Listing.......................................     46

           Trading Markets.............................................     46
</Table>


                                       i
<Page>


<Table>
<Caption>
                                                                           PAGE
                                                                           ----
<S>        <C>                                                           <C>
ITEM 10.   Additional Information......................................     47

           Articles of Incorporation...................................     47

           Material Contracts..........................................     51

           Exchange Controls...........................................     51

           Taxation....................................................     51

           Ownership of ADSs in General................................     54

           Distributions...............................................     54

           Sale or Exchange of Common Shares or ADSs...................     54

           Backup Withholding Tax and Information Reporting
           Requirements................................................     55

           Documents on Display........................................     55

           Quantitative and Qualitative Disclosures about Market
ITEM 11.   Risk........................................................     56

           Foreign-Exchange Risk Management............................     56

           Interest-Rate Risk Management...............................     56

           Other Financial Instruments.................................     57

ITEM 12.   Description of Securities Other than Equity Securities......     57

                                     PART II

ITEM 13.   Defaults, Dividend Arrearages and Delinquencies.............     57

           Material Modifications to the Rights of Security Holders and
ITEM 14.   Use of Proceeds.............................................     57

ITEM 15.   Reserved....................................................     57

ITEM 16.   Reserved....................................................     57

                                    PART III

ITEM 17.   Financial Statements........................................     57

ITEM 18.   Financial Statements........................................     57

ITEM 19.   Exhibits....................................................     59

Index to Financial Statements..........................................    F-1

Independent Auditor's Report on Financial Statement Schedule...........    S-1
</Table>


                                       ii
<Page>
                                  INTRODUCTION

    Stolt Offshore S.A. is a Luxembourg registered company. In this Report, the
terms "we", "us", "our" and "Stolt Offshore" refer to Stolt Offshore S.A. and,
unless the context otherwise requires, its consolidated subsidiaries. References
to Stolt Offshore activities by years refer to fiscal years ended November 30.
Our Common Shares are traded on the Nasdaq National Market ("Nasdaq") in the
form of American Depositary Shares ("ADSs") (each ADS representing one Common
Share) under the ticker symbol "SOSA" and are listed on the Oslo Stock Exchange
under the ticker symbol "STO".

    On March 7, 2001, we reclassified our non-voting Class A Shares as Common
Shares on a one-for-one basis; on that date, trading in the Class A Shares on
Nasdaq and the Oslo Stock Exchange ceased. As a result, Common Shares are our
only publicly-traded security. Reference to Class A Shares means Class A Shares
up until March 7, 2001, and thereafter will mean Common Shares. The
reclassification did not change the underlying economic interests of existing
shareholders nor the number of shares used for earnings per share purposes.


    As of May 31, 2002, we had outstanding 63,850,450 Common Shares and
34,000,000 Class B Shares, which are economically equivalent to 17,000,000
Common Shares and are all owned by Stolt-Nielsen S.A. ("SNSA"), giving a total
of 80,850,450 Common Share equivalents.


                             BASIS OF PRESENTATION


    The consolidated financial statements, including the notes thereto, included
in this Report (the "Consolidated Financial Statements") have been prepared in
accordance with generally accepted accounting principles in the United States.
The Consolidated Financial Statements include the accounts of all majority-owned
companies over which we have operating control.


               SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

    This Report and some of the documents incorporated by reference in this
Report contain "forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. These statements relate to our expectations,
beliefs, intentions or strategies regarding the future. These statements may be
identified by the use of words like "anticipate," "believe," "estimate,"
"expect," "intend," "may," "plan," "project," "will," "should," and "seek" and
similar expressions. Forward-looking statements include, but are not limited to,
statements about the following subjects:

<Table>
<S>                                        <C>
- business strategies                      - budgets for capital and other
                                           expenditures

- growth opportunities                     - timing and cost of completion of
                                           projects

- market outlook                           - performance of contracts

- competitive position                     - outcome of legal proceedings

- expected results of operations           - adequacy of insurance

- financing plans
</Table>

    The forward-looking statements that we make reflect our current views and
assumptions with respect to future events and are subject to risks and
uncertainties. Actual and future results and trends could differ materially from
those set forth in such statements due to various factors, including those
discussed in this Report under "Item 3. Key Information--Risk Factors" and "Item
5. Operating and Financial Review and Prospects." Many of these factors are
beyond our ability to control or predict. Given these uncertainties, you should
not place undue reliance on the forward-looking statements. We undertake no
obligation to update publicly or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.

                                       1
<Page>
                                     PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS.

    Not applicable.

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE.

    Not applicable.

ITEM 3. KEY INFORMATION.

SELECTED FINANCIAL DATA

    The selected consolidated financial data presented below for the fiscal
years ended November 30, 2001, 2000, 1999, 1998 and 1997 and as of November 30,
2001, 2000, 1999, 1998 and 1997 have been taken or are derived from our audited
Consolidated Financial Statements for those periods. The financial information
presented below is only a summary and should be read together with the
Consolidated Financial Statements and "Item 5. Operating and Financial Review
and Prospects."

<Table>
<Caption>
                                                                       YEAR ENDED NOVEMBER 30,
                                                         ----------------------------------------------------
                                                           2001       2000       1999       1998       1997
                                                         --------   --------   --------   --------   --------
                                                               (IN MILLIONS, EXCEPT PER SHARE DATA)(A)
<S>                                                      <C>        <C>        <C>        <C>        <C>
CONSOLIDATED STATEMENT OF OPERATIONS DATA:
Net operating revenue.................................   $1,255.9    $983.4     $640.7     $649.8     $431.1
Operating expenses....................................    1,161.6     930.0      568.3      540.9      353.4
Gross profit..........................................       94.4      53.4       72.4      108.9       77.7
Equity in net income of non-consolidated joint
  ventures............................................       11.7       5.8        5.2       14.8       12.2
Administrative and general expenses...................       64.0      60.9       51.8       45.9       31.4
Impairment of Comex trade name(b).....................       (7.9)       --         --         --         --
Restructuring charges(c)..............................         --      (3.3)      (1.6)        --       (4.2)
Net operating income (loss)...........................       34.1      (5.0)      24.2       77.8       54.3
Interest expense, net.................................       26.8      30.0       16.7        5.1        9.5
Other income (expense), net...........................        2.0      (0.7)       0.3       (0.5)       5.1
Income tax (provision) benefit........................      (20.6)      3.8        8.5      (17.5)     (11.1)
Minority interests....................................       (2.8)     (2.5)        --       (0.4)        --
Net (loss) income before cumulative effect of change
  in accounting policy................................      (14.2)    (34.4)      16.2       54.2       39.0
Cumulative effect of a change in accounting policy....         --        --         --        3.1         --
                                                         --------    ------     ------     ------     ------
Net (loss) income after cumulative effect of change in
  accounting policy...................................   $  (14.2)   $(34.4)    $ 16.2     $ 57.1     $ 39.0
Net (loss) income per Common Share and Common Share
  equivalent before cumulative effect of change in
  accounting policy(d)
  Basic...............................................      (0.16)    (0.44)      0.27       0.92       0.83
  Diluted.............................................      (0.16)    (0.44)      0.27       0.91       0.82
Net (loss) income per Common Share and Common Share
  equivalent after cumulative effect of change in
  accounting policy(d)
  Basic...............................................      (0.16)    (0.44)      0.27       0.97       0.83
  Diluted.............................................      (0.16)    (0.44)      0.27       0.96       0.82
</Table>

                                       2
<Page>


<Table>
<Caption>
                                                                       YEAR ENDED NOVEMBER 30,
                                                         ----------------------------------------------------
                                                           2001       2000       1999       1998       1997
                                                         --------   --------   --------   --------   --------
                                                               (IN MILLIONS, EXCEPT PER SHARE DATA)(A)
<S>                                                      <C>        <C>        <C>        <C>        <C>
Weighted average number of Common Shares and Common
  Share equivalents outstanding(d)
  Basic...............................................       87.2      78.8       59.1       59.0       47.0
  Diluted.............................................       87.2      78.8       59.5       60.0       47.6
STATEMENT OF CASH FLOWS DATA:
Net cash provided by operating activities.............   $    4.5    $ 58.2     $ 40.3     $103.7     $  2.9
Net cash used in investing activities.................      (71.2)   (160.6)     (75.8)    (328.2)    (101.3)
Net cash provided by financing activities.............       72.5     103.8       34.7      225.3      102.3
OTHER FINANCIAL DATA:
Depreciation and amortization.........................   $   91.8    $ 82.1     $ 56.1     $ 35.5     $ 25.5
</Table>


<Table>
<Caption>
                                                                  AS OF NOVEMBER 30,
                                                 ----------------------------------------------------
                                                   2001       2000       1999       1998       1997
                                                 --------   --------   --------   --------   --------
                                                                    (IN MILLIONS)
<S>                                              <C>        <C>        <C>        <C>        <C>
BALANCE SHEET DATA:
Current assets less current liabilities(e)....   $  101.8   $   16.5   $   82.4   $   70.1   $   79.1
Fixed assets, net.............................      779.5      803.4      436.1      408.8      244.4
Total assets..................................    1,560.3    1,402.8      843.4      877.0      457.4
Long-term debt, including current
  portion(f)..................................      358.7      292.5      200.7      221.2        2.6
Capital stock, including paid in surplus......      672.1      671.7      330.9      330.4      330.4
Shareholders' equity..........................      660.0      669.4      408.4      400.6      348.0
</Table>

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

(a) Totals may not add due to rounding.

(b) In 2001, in light of the increased worldwide recognition of the Stolt
    Offshore name, we determined that the value of our former trade name, Comex,
    had been impaired and recorded a charge to write down the value of the trade
    name.

(c) In 2000, following the acquisition of ETPM, we implemented a reorganization
    plan to remove duplicate capacity in the United Kingdom and Southern Europe,
    Africa and the Middle East regions. We recorded $2.6 million of
    restructuring costs in 2000 related to severance costs and the closure of
    facilities in the United Kingdom and France. The remainder related to the
    introduction of common information systems and processes across our company.
    In 1999, we implemented a reorganization of our North Sea operations and
    closed offices in the United Kingdom and Norway. Non-recurring costs
    primarily relating to redundancy costs of $1.6 million were expensed in that
    year. In 1997 we recognized a Statement of Financial Accounting Standards
    No. 121 impairment loss of $4.2 million on certain subsea assets, which were
    unable to generate sufficient cash flow to support their net book value and
    which were written down to their fair market value.


(d) All share data and per share data have been restated to reflect the
    two-for-one stock split completed on January 9, 1998, the Class A Share
    distribution on June 25, 1998 and the reclassification of Class A Shares to
    Common Shares on a one-for-one basis on March 7, 2001.



(e) Excludes current maturities of long-term debt and capital lease obligations
    and short-term debt due to affiliate.



(f) Includes capital lease obligations and long-term debt due to affiliate.


                                       3
<Page>
RISK FACTORS

    You should carefully consider the following factors and the information
contained in this Report, including the information incorporated by reference
into this Report. The following is a summary of all of the risks applicable to
our business operations that we consider to be material. If any of the events
described below actually occurs, our business, financial condition or results of
operations could be materially adversely affected.

OUR BUSINESS IS AFFECTED BY EXPENDITURES BY PARTICIPANTS IN THE OIL AND GAS
  INDUSTRY.

    Demand for our services depends on expenditures by participants in the oil
and gas industry and particularly on capital expenditure budgets of the
companies engaged in the exploration, development and production of offshore oil
and gas. In particular, the oil and gas industry has been consolidating. There
are fewer and larger oil and gas companies that control expenditures for the
types of services and products that we and our competitors provide. Offshore oil
and gas field capital expenditures are also influenced by many other factors
beyond our control, including:

    - prices of oil and gas and anticipated growth in world oil and gas demand;

    - the discovery rate of new offshore oil and gas reserves;

    - the economic feasibility of developing particular offshore oil and gas
      fields;

    - the production from existing producing oil and gas fields;

    - political and economic conditions in areas where offshore oil and gas
      exploration and development may occur;

    - policies of governments regarding the exploration for, pricing and
      production and development of their oil and gas reserves; and

    - the ability of oil and gas companies to access or generate capital and the
      cost of such capital.

UNEXPECTED COSTS MAY ADVERSELY AFFECT THE AMOUNT WE REALIZE FROM FIXED-PRICE
CONTRACTS.

    A significant proportion of our business is performed on a fixed-price or
turnkey basis. In 2001, 2000 and 1999, approximately 72%, 74% and 47%,
respectively, of our revenue was derived from fixed-price contracts. Long-term
fixed-priced contracts are inherently risky because of the possibility that we
might incur costs that we did not expect at the time of bidding, including the
cost of satisfying post-completion warranty obligations. The cost and gross
profit realized on such contracts can vary from those expected because of
changes beyond our control, including but not limited to:

    - unanticipated technical problems with the equipment we are supplying or
      developing which may require that we spend our own money to remedy the
      problem;

    - unanticipated changes in the costs of components, materials or labor;

    - unanticipated difficulties in obtaining required governmental permits or
      approvals;

    - project modifications creating unanticipated costs;

    - delays caused by local weather and soil conditions; and

    - suppliers' or subcontractors' failure to perform.

    These risks are exacerbated if the duration of the project is long-term,
because there is more time for and, therefore, an increased risk that the
circumstances upon which we originally bid and developed a price will change in
a manner that increases our costs. Our long-term projects often subject us to
penalties if we cannot complete portions of the projects in accordance with
agreed-upon time limits.

                                       4
<Page>
WE MAY BE LIABLE TO THIRD PARTIES FOR THE FAILURE OF OUR JOINT VENTURE PARTNERS
TO FULFILL THEIR OBLIGATIONS.

    Under some of our joint venture agreements, we and our partners are jointly
and severally liable to the customer for the performance of the contract. If our
joint venture partner in such arrangement fails to fulfill its obligations, we
could have to carry the resultant liability toward the customer and would have
to rely on our ability to obtain reimbursement from our joint venture partner.
If our joint venture partner became insolvent or ceased operations, this might
not be possible.

OUR METHOD OF ACCOUNTING FOR PROJECTS COULD RESULT IN A REDUCTION OR ELIMINATION
OF PREVIOUSLY REPORTED PROFITS.

    Substantially all of our projects are accounted for on the
"percentage-of-completion" method, which is standard for our industry and in
compliance with U.S. generally accepted accounting principles. Under the
percentage-of-completion method, estimated contract revenues are accrued based
on the ratio of costs incurred to date to the total estimated costs, taking into
account the level of physical completion. Estimated contract losses are
recognized in full when determined. Contract revenues and total cost estimates
are reviewed and revised periodically as work progresses and as change orders
are approved, and adjustments based on the percentage of completion are
reflected in contract revenues in the reporting period when these estimates are
revised. To the extent that these adjustments result in a reduction or
elimination of previously reported contract revenues, we would recognize a
charge against current earnings that may be significant depending on the size of
the project or the adjustment.

OUR BUSINESS COULD SUFFER AS A RESULT OF CURRENT OR FUTURE LITIGATION.


    We are subject to legal claims by customers, sub-contractors, employees,
joint venture partners, government agencies and competitors. In particular, our
competitor, Coflexip S.A., has commenced legal proceedings through the U.K. High
Court against three of our subsidiaries claiming infringement of a certain
patent held by Coflexip relating to flexible flowline laying technology in the
United Kingdom. Judgment was rendered on January 22, 1999 and January 29, 1999.
The disputed patent was held valid. We appealed and the Appeal Court maintained
the validity of the patent and broadened its application compared to the High
Court decision. We have applied for leave to appeal the Appeal Court decision to
the House of Lords, which has now been denied. The result of these court
decisions is that the flexible lay system tower on the SEAWAY FALCON, and the
process by which the system lays flexible conduits, has been held to infringe
Coflexip's patent in the United Kingdom. During 2001, Coflexip submitted an
amended claim for damages claiming lost profits on a total of 15 projects. In
addition, there is a claim for alleged price depreciation on certain other
projects. The claim is for approximately $89.0 million, up from approximately
$14.0 million claimed previously, plus interest, legal costs and a royalty for
each time that the flexible lay system tower on the SEAWAY FALCON was brought
into U.K. waters. We estimate that the total claim will amount to approximately
$115.0 million. In the alternative, Coflexip claims a reasonable royalty for
each act of infringement, interest and legal costs. Coflexip has not quantified
this claim, but we expect that it will be considerably less than the claim to
lost profits. We, in consultation with our advisers, have assessed that the
range of possible outcomes for the resolution of damages is $1.5 million to
$115.0 million and have determined that there is no amount within the range that
is a better estimate than any other amount. Consequently, in accordance with
Statement of Financial Accounting Standards ("SFAS") No. 5, ACCOUNTING FOR
CONTINGENCIES, we have reserved $1.5 million in the financial statements, being
the lower end of the range. The amount of damages is nevertheless uncertain, and
no assurance can be given that the provided amount is sufficient. If the amount
we are ultimately determined to owe, if any, is substantially more than we have
currently reserved or if we increase the amount of the reserve for this claim,
it could have a material adverse effect on our results of operations.


                                       5
<Page>
    Furthermore, there can be no assurance that the results of the litigation
described above or other legal proceedings will not materially harm our business
or reputation.

OUR INTERNATIONAL OPERATIONS EXPOSE US TO CHANGES IN FOREIGN REGULATIONS AND
OTHER RISKS INHERENT TO INTERNATIONAL BUSINESS, ANY OF WHICH COULD AFFECT OUR
OPERATING RESULTS.

    Our operations in the South America, Asia-Pacific and Southern
Europe/Africa/Middle East regions are mainly performed in emerging markets such
as Angola, Nigeria, Brazil and Indonesia. In total, these regions accounted for
49%, 55% and 24% of our net operating revenue in 2001, 2000 and 1999,
respectively. Operations in these emerging markets present risks including:

    - economic instability, which could make it difficult for us to anticipate
      future business conditions in these markets;

    - political instability, which could discourage investment and complicate
      our dealings with governments;

    - boycotts and embargoes that may be imposed by the international community
      on countries in which we operate;

    - labor unrest, particularly in Nigeria and Angola where our large
      workforces are prone to strike action;

    - disruptions due to civil war, election outcomes, shortage of commodities,
      power interruptions or inflation;

    - the imposition of unexpected taxes or other payments on our revenues in
      these markets; and

    - the introduction of exchange controls and other restrictions by foreign
      governments.

OUR QUARTERLY RESULTS MAY FLUCTUATE DUE TO ADVERSE WEATHER CONDITIONS DURING THE
WINTER.

    Over the past three years, a substantial portion of our revenue has been
generated from work performed in the North Sea and North America. Adverse
weather conditions during the winter months in these regions usually result in
low levels of activity. Additionally, during certain periods of the year, we may
encounter adverse weather conditions such as hurricanes or tropical storms in
the Gulf of Mexico. During periods of curtailed activity due to adverse weather
conditions, we continue to incur operating expenses, but our revenues from
operations are delayed or reduced. As a result, full-year results are not likely
to be a direct multiple of any particular quarter or combination of quarters.

WE FACE COMPETITION WHICH COULD HAVE AN ADVERSE EFFECT UPON OUR OPERATING
RESULTS AND FINANCIAL CONDITION.

    The offshore oil and gas services business is highly competitive, and
offshore contractors compete intensely for available projects. Contracts for our
services are generally awarded on a competitive bid basis, and although
customers may consider, among other things, the availability and capability of
equipment and the reputation and experience of the contractor, price is a
primary factor in determining which contractor is awarded a contract. Several of
our competitors and potential competitors are larger than we are and have
greater financial and other resources than we have. This intense competition
could result in pricing pressures, lower sales and reduced margins which would
have an adverse effect upon our operating results and financial condition.

WE DEPEND ON CERTAIN SIGNIFICANT CUSTOMERS AND LONG-TERM CONTRACTS AND THE LOSS
OF ONE OR MORE SIGNIFICANT CUSTOMERS OR THE FAILURE TO REPLACE OR ENTER INTO NEW
LONG-TERM CONTRACTS COULD ADVERSELY AFFECT OUR OPERATING RESULTS.

    In 2001, TotalFinaElf accounted for 24% of our net operating revenue and
Williams Gas accounted for 11% of our net operating revenue. In 2000,
TotalFinaElf accounted for 24%, and Shell accounted for 10%, of our net
operating revenue. During 2001 and 2000, our ten largest customers

                                       6
<Page>
accounted for 76% and 67%, respectively, of our net operating revenue, and over
that period seven customers, including BP, ChevronTexaco, Petrobras, Shell,
Statoil, TotalFinaElf and Triton Energy (acquired in 2001 by Amerada Hess)
consistently numbered among our ten largest customers. Revenues from our largest
customers are often related to specific long-term contracts that upon completion
may not be replaced by contracts of equivalent size. Our inability to replace
significant long-term projects on similar terms or the loss of any one or more
of our significant customers or a substantial decrease in demand by our
significant customers could result in a substantial loss of revenues which could
have a material adverse effect on us.

WE COULD BE ADVERSELY AFFECTED IF WE FAIL TO KEEP PACE WITH TECHNOLOGICAL
CHANGES, AND CHANGES IN TECHNOLOGY COULD RESULT IN WRITE-DOWNS OF ASSETS.

    Our customers are constantly seeking to develop oil and gas fields in deeper
waters. To meet our customers' needs, we must continuously develop new, and
update existing, technology for the installation, repair and maintenance of
offshore structures. In addition, rapid and frequent technology and market
demand changes can often render existing technologies obsolete requiring
substantial new capital expenditures and/or write-downs of assets. Our failure
to anticipate or to respond adequately and timely to changing technology, market
demands and/or customer requirements could adversely affect our business and
financial results.

OUR INTERNATIONAL OPERATIONS EXPOSE US TO THE RISK OF FLUCTUATIONS IN CURRENCY
EXCHANGE RATES.

    The results of operations and financial position of most of our non-U.S.
subsidiaries are initially reported in the local currencies of countries in
which those subsidiaries reside. That financial information is then translated
into U.S. dollars at the applicable exchange rates for inclusion in our
consolidated financial statements. For 2001, approximately 26.0% of our
consolidated net operating revenues were generated in local currencies and
translated into U.S. dollars. Approximately 0.4%, 16.7% and 8.8% of our revenue
was generated in Euros, British pounds and Norwegian kroner, respectively. The
exchange rate between these currencies and the U.S. dollar can fluctuate
substantially, which could have a significant translation effect on our reported
consolidated results of operations and financial position.

    In addition, we are subject to currency risk exposure when our sales are
denominated in currencies that are different from those in which our expenses
are incurred. In this case, if the value of the currency in which sales are
recorded weakens relative to the currency in which we incur expenses, then there
is a negative impact on our profit margin.

WE ARE EXPOSED TO SUBSTANTIAL HAZARDS AND RISKS THAT ARE INHERENT IN THE
OFFSHORE SERVICES BUSINESS FOR WHICH LIABILITIES MAY POTENTIALLY EXCEED OUR
INSURANCE COVERAGE AND CONTRACTUAL INDEMNITY PROVISIONS.

    Our operations are subject to all the risks normally associated with
offshore development and production and could result in damage to or loss of
property, suspension of operations or injury or death to personnel or third
parties. We insure our assets at levels which our management believes reflect
their current market value. Such assets include all capital items such as ships,
major equipment and land-based property. The only assets not insured are those
where the cost of such insurance would be disproportionate to their value.

    Our operations are conducted in hazardous environments where accidents
involving catastrophic damage or loss of life could result, and litigation
arising from such an event may result in our being named a defendant in lawsuits
asserting large claims. We insure for liability arising from our operations,
both onshore and offshore, including loss of or damage to third-party property,
death or injury to employees or third parties, statutory workers compensation
protection and pollution. Although there can be no assurance that the amount of
insurance we carry is sufficient to protect us fully in all events, all such
insurance is carried at levels of coverage and deductibles that we consider
financially

                                       7
<Page>
prudent. A successful liability claim for which we are underinsured or uninsured
could have a material adverse effect on us.

    We generally seek to obtain indemnity agreements whenever possible from our
customers requiring those customers to hold us harmless in the event of
structural damage, loss of production or liability for pollution that originates
below the water surface. Such contractual indemnification, however, does not
generally cover liability resulting from the gross negligence or willful
misconduct of, or violation of law by, our employees or subcontractors.
Additionally, if we suffer a loss for which we are entitled to indemnity, we are
dependent on our customer's ability to satisfy its indemnity obligation. If the
customer cannot satisfy its obligation, we could suffer losses.

OUR LEVEL OF DEBT MAY CONSTRAIN OUR OPERATIONS.

    As of April 30, 2002, we had an aggregate of $370.9 million of debt
outstanding. The degree to which we are leveraged may affect our ability to
obtain additional financing in the future for working capital, capital
expenditures, product and service development and general corporate purposes, to
utilize cash flow from operations for purposes other than debt service, and to
overcome seasonal or other cyclical variations in our business. Our ability to
satisfy our obligations and to reduce our debt depends on our future
performance.

SNSA EXERCISES A CONTROLLING INFLUENCE OVER MATTERS REQUIRING SHAREHOLDER
APPROVAL, WHICH COULD PREVENT A CHANGE OF CONTROL.


    As of May 31, 2002, a wholly owned subsidiary of SNSA owned 29,275,223 of
our Common Shares and all 34,000,000 of our Class B Shares. This ownership
represents an economic interest in us of approximately 57% and a voting interest
of approximately 65%. As of May 31, 2002, the Stolt-Nielsen family, directly and
indirectly through Fiducia Ltd., controlled approximately 60% of the outstanding
shares of SNSA entitled to vote generally on matters brought to a vote of
shareholders of SNSA.


    SNSA currently exercises a controlling influence over our operations and has
sufficient voting power to control the outcome of matters requiring shareholder
approval including: the composition of our Board of Directors which has the
authority to direct our business and to appoint and remove our officers;
approving or rejecting a merger, consolidation or other business combination;
raising future capital; and amending our Articles of Incorporation which govern
the rights attached to our Common Shares. This control may also make it
difficult to take control of Stolt Offshore without the approval of SNSA.
Additionally, the interests of SNSA may conflict with those of other
shareholders.

OUR ARTICLES OF INCORPORATION IMPOSE RESTRICTIONS ON THE OWNERSHIP OF OUR
  SECURITIES.

    Our Articles of Incorporation state that no one U.S. person (defined to
include any person who is a citizen or resident of the United States, a
corporation organized under the laws of the United States and certain other
entities and their affiliates and associates) may own, directly or indirectly,
more than 9.9% of our total outstanding shares at any time. In addition, the
Articles provide that all shareholders of any single country may not own,
directly or indirectly, more than 49.9% of our outstanding shares, and no person
may own, directly or indirectly, more than 20% of our outstanding shares unless
a majority of our Board of Directors shall have authorized such shareholding in
advance. The Board of Directors may take remedial action if it determines that
we are threatened with "imminent and grave damage" (as defined in the Articles).
We have been advised by our Luxembourg counsel, Elvinger, Hoss & Prussen, that
there are no Luxembourg judicial interpretations of such phrase, but that
situations involving hostile takeovers, adverse tax consequences to us or
governmental sanctions are likely to be among the situations covered by that
phrase. These defensive measures may have the effect of making more difficult a
merger involving us, or a tender offer, open-market purchase program or other
purchase of our shares, in circumstances that could give shareholders the
opportunity to realize a premium over the then prevailing market price for their
shares.

                                       8
<Page>
IT MAY BE DIFFICULT TO ENFORCE A U.S. JUDGMENT AGAINST US, OUR OFFICERS AND OUR
DIRECTORS OR TO ASSERT U.S. SECURITIES LAWS CLAIMS IN LUXEMBOURG OR SERVE
PROCESS ON OUR OFFICERS OR DIRECTORS.

    We are a corporation organized under the laws of Luxembourg. Several of our
directors and officers reside and maintain most of their assets outside the
United States and it may not be possible to effect service of process within the
United States on us or on such persons, or to enforce against us or them in U.S.
courts judgments obtained in such courts based on the civil liability provisions
of the U.S. federal securities laws. We have been advised by Elvinger, Hoss &
Prussen, our Luxembourg counsel, that there is substantial doubt as to whether
the courts of Luxembourg would (1) enforce judgments of U.S. courts obtained in
actions against us or such directors and officers based on the civil liability
provisions of the U.S. federal securities laws or (2) entertain original actions
brought in Luxembourg against us or such directors and officers predicated
solely upon the civil liability provisions of the U.S. federal securities laws.
There is no treaty in effect between the United States and Luxembourg providing
for such enforcement, and there are grounds upon which Luxembourg courts may
choose not to enforce judgments of U.S. courts. Certain remedies available under
the U.S. federal securities laws would not be enforced by Luxembourg courts as
contrary to that nation's public policy.


OTHER MATTERS



    Our independent public accountant is the U.K. member firm ("AAUK") of
Andersen Worldwide. On March 14, 2002, Andersen Worldwide's U.S. member firm,
Arthur Andersen LLP, was indicted by the U.S. Department of Justice on federal
obstruction of justice charges in connection with its alleged destruction of
documents related to Enron Corp. On June 15, 2002, a jury convicted Arthur
Andersen LLP on these charges. The SEC has announced that it will continue to
accept financial statements audited by member firms of Andersen Worldwide until
August 31, 2002, the date on which Arthur Andersen LLP intends to cease
practicing before the SEC. Relief which may be available under the federal
securities laws against auditing firms may not be available as a practical
matter against AAUK should it cease to operate or be financially impaired.



    AAUK has entered into an agreement with the U.K. member firm of Deloitte &
Touche. The agreement was approved by European Union competition authorities on
July 1, 2002, and the transaction is expected to be completed within the next
month. As a result of the transaction, partners and staff from AAUK will join
the U.K. firm of Deloitte & Touche. However, under the agreement, Deloitte &
Touche expressly does not intend to assume any obligations or liabilities that
AAUK may have or may have incurred prior to completion of that agreement, and
accordingly it may be more difficult for our shareholders to recover damages
from AAUK if liability were to be established.



    We have agreed with AAUK that the firm will formally resign as our
independent auditors on July 31, 2002. The reports of AAUK on our financial
statements for the fiscal years ended November 30, 1999, 2000 and 2001 contained
no adverse opinion or disclaimer of opinion, nor were the reports qualified or
modified as to uncertainty, audit scope or accounting principles.



    The audit committee of our board of directors has recommended that
Deloitte & Touche be appointed as our independent public accountants, and our
board of directors is expected to make a final decision in August 2002. In
addition, under Luxembourg law the decision to appoint new auditors is subject
to the approval of our shareholders. We intend to hold an extraordinary general
meeting of shareholders as soon as practicable after our board meeting.



    As an SEC registrant, we are required to file with the SEC annual financial
statements audited by our independent public accountants. Our access to the
capital markets and our ability to make timely SEC filings could be impaired
once the SEC ceases to accept financial statements audited or reviewed by AAUK,
or when AAUK becomes unable to make the required representations.


                                       9
<Page>
ITEM 4. INFORMATION ON THE COMPANY.

OVERVIEW


    We are one of the largest offshore services contractors in the world. We
design, procure, build, install and service a range of offshore surface and
subsurface infrastructure for the global oil and gas industry. We specialize in
creating and applying innovative and efficient solutions in response to the
technical complexities faced by offshore oil and gas companies as they explore
and develop production fields in increasingly deeper water and more demanding
offshore environments. Our revenues for the year ended November 30, 2001 were
$1.3 billion, and our order backlog on June 15, 2002 was $1.6 billion, as
compared to our order backlog of $1.7 billion at June 15, 2001. Of the June 15,
2002 backlog amount, we expect that $0.8 billion will be recognized as revenue
in 2002 and $0.8 billion will not be filled in the current year.


    We provide services and products that add value for our customers at all
phases of offshore oil and gas field exploration, development and production. We
survey the seabed and provide other support services for drilling test holes
during the exploration phase. When a field is being developed, we apply our
technical expertise and knowledge of regional conditions to offer conceptual and
engineering designs for the field. We also procure or fabricate and install
equipment used in field development. This equipment includes the above-water
topsides and platforms used for processing recovered oil and gas, wellheads,
pipelines and electrical and hydraulic cables, known as umbilicals, that are
used to control subsea wells. The pipelines are used to transport oil and gas
underwater and to the production and processing facilities at the surface. They
may be steel pipe, referred to as rigid pipe, or of a bonded structure, referred
to as flexible pipe, depending on technical requirements, and may be narrow
(flowlines) or wide (trunklines) depending on production volumes and pressure.
We also combine our design and fabrication expertise to manage the building of
floating facilities (known as FPSOs) that process, store and offload oil and
which are used in very deep water where a platform or topside would be
impractical. During the time that the field is producing oil or gas, we inspect,
maintain and repair this equipment. Once the field has been depleted and is to
be abandoned, we provide field decommissioning services which include the
removal of offshore structures and equipment.


    We are one of only a few companies that can offer a full range of offshore
development and construction services on a global basis. Our worldwide
operations are managed through six regional offices. We employ approximately 500
conceptual and detailed design engineers worldwide. We have operated in more
than 60 countries and currently operate in over 34 countries.


    We have a world class fleet of highly specialized ships, barges and unmanned
underwater remotely operated vehicles, or ROVs, deployed in the world's major
offshore oil and gas exploration regions, including:

    - 9 construction support ships;

    - 4 flowline lay ships;

    - 9 survey/inspection, repair and maintenance ships;

    - 11 anchored construction and maintenance ships;

    - 1 heavy lift ship;

    - 7 pipelay barges;

    - 4 tugs and other ships;

    - 95 ROVs (5 of which are owned by a joint venture); and

    - 11 hardsuits for manned dives.

                                       10
<Page>
    Projects relating to the engineering and construction of new offshore oil
and gas fields, which typically last more than one year, accounts for
approximately 95% of our revenues while work related to the inspection, repair
and maintenance of oil and gas fields throughout their time in production
accounts for the remaining 5% of revenues.

    Our services cover all phases of offshore oil and gas operations, from
exploration to decommissioning. We offer our products and services through the
following lines of business:

    - THE PIPELAY AND ENGINEERING, PROCUREMENT, INSTALLATION AND COMMISSIONING
      (EPIC) business line involves offshore fields where platforms are part of
      the infrastructure or where there is a large diameter pipeline or a major
      offshore element of pipeline work. These activities may include platform
      design and fabrication or tieback projects, which involve pipelaying or
      pipeline procurement to connect a new production well to an existing
      structure.

    - THE SUBSEA CONSTRUCTION business line involves projects where there may be
      one or more of the following elements: well control umbilical laying;
      burying rigid or flexible pipelines in the seabed to protect and insulate
      them (trenching); laying flexible pipelines; installing short pipes that
      connect other pipelines (jumpers); and/or hyperbaric welding (which is
      welding performed in a dry atmosphere in an underwater chamber).

    - THE DEEPWATER DEVELOPMENT business line involves large or complex offshore
      projects where we have some influence over the architecture of the oil or
      gas infrastructure and could include the design, manufacturing and
      installation of flowlines, production risers and other subsea structures.

    - THE FLOATING PRODUCTION business line involves the design and management
      of the building of FPSOs for use in very deep water.

    - THE REGIONAL SERVICES business line handles local business projects
      including seabed survey and positioning for drill rig location or defining
      pipeline routes, engineering studies, drilling support, shallow water
      pipelay or inspection, repair and maintenance operations.

    We also provide field decommissioning services at the end of the working
life of an offshore oilfield.

    We offer heavy lift floating crane services through a joint venture company,
SHL. SHL charters the heavy lift barge STANISLAV YUDIN from a subsidiary of
Lukoil our joint venture partner in SHL. We also manufacture flexible flowlines
and dynamic flexible risers (which are flexible pipelines from the sea floor to
the surface) through the joint venture company NKT Flexibles I/S, in which we
have a 49% interest. The remainder of the joint ventures in which we have
interests have been formed either with a national oil company, such as Sonangol
in Angola or Socar in Azerbaijan, or on a project-specific basis to enhance the
range of services provided to the customer. We typically have interests ranging
from 25% to 55% in these joint ventures.

    Our registered office is located at 26, rue Louvigny, Luxembourg and we are
registered in the Companies' Registrar of the Luxembourg District Court under
the designation "R.C. Luxembourg B43172." Our principal executive offices are
c/o Stolt Offshore M.S. Ltd., Dolphin House, Windmill Road, Sunbury-on-Thames,
Middlesex TW16 7HT England, telephone number (+44) (0)1932-773-700. Our website
address is www.stoltoffshore.com. Our agent for U.S. federal securities law
purposes is Stolt-Nielsen Inc., 8 Sound Shore Drive, P.O. Box 2300, Greenwich,
Connecticut 06836.

                                       11
<Page>
HISTORY AND DEVELOPMENT OF STOLT OFFSHORE

    A publicly traded company since May 1993, we were established through the
merger of the businesses of two leading diving support services companies, Comex
Services S.A. ("Comex") and Stolt-Nielsen Seaway A/S, which were acquired by
SNSA in separate transactions in 1992. At the time of acquisition, Comex was a
leading worldwide subsea services contractor that pioneered deepwater saturation
diving and subsea construction using both manned and unmanned techniques.
Stolt-Nielsen Seaway A/S operated principally in the North Sea and pioneered the
development and use of specially designed, technologically sophisticated diving
support ships and ROVs to support operations in hostile deepwater environments.

    In August 1998, we acquired the Houston-based Ceanic Corporation, a publicly
traded subsea contractor, for approximately $218.9 million. Ceanic provided a
range of subsea services and products to the offshore oil and gas industry in
the Gulf of Mexico and inland underwater services to domestic and governmental
customers. With this acquisition we acquired a substantial fleet of ships mostly
designed for shallow water work, ROVs and other related technologies. Our
acquisition of Ceanic was strategically important in that it provided
significant operations in the Gulf of Mexico. These operations, combined with
our deepwater technology and know-how, allow us to participate in the growing
deepwater construction market in the Gulf of Mexico and give us the ability to
build relationships with Houston-based oil and gas companies that conduct much
of their worldwide business from Houston.

    In December 1998, we acquired the ROV business of Dolphin A/S for
approximately $16.9 million. This acquisition, which included 21 ROVs mostly on
long-term contracts to Norwegian oil companies, strengthened our position in the
ROV drill support market in Norway.

    In December 7, 1999, we completed a transaction to form a joint venture
entity, NKT a manufacturer of flexible flowlines and risers for the offshore oil
and gas industry. We own 49% of NKT, and the remaining 51% is owned by NKT
Holdings A/S. The total consideration for our share in the joint venture was
$36.0 million funded partly by cash and partly by the issuance of Class A
Shares. The Class A Shares were subsequently reclassified as Common Shares on a
one-for-one basis. This investment secures our supply of flexible products.

    On December 16, 1999, we acquired the French offshore construction and
engineering company ETPM S.A., a wholly owned subsidiary of Groupe GTM S.A.
Groupe GTM was subsequently acquired by Groupe Vinci S.A. The total
consideration for this acquisition, including debt assumed, was approximately
$350.0 million, funded partly by cash and partly by the issuance of 6.1 million
Class A Shares. The Class A Shares were subsequently reclassified as Common
Shares on a one-for-one basis. The acquisition of ETPM provided us with a strong
market position in West Africa, which is one of the fastest growing markets for
our services. We also gained significant engineering skills, particularly in
conceptual engineering and offshore design of both subsea structures and of
fixed and floating production platforms, in addition to a fleet of pipelay
barges, which broadened our range of pipelay capabilities.

    On July 18, 2001, we acquired the Paris-based engineering company Ingerop
Litwin from Vinci. On September 4, 2001, we acquired a controlling interest in
the Houston-based engineering company, Paragon Engineering Services, Inc. We
paid a total of $16.7 million of cash for these two companies, $4.3 million of
which in relation to the Paragon acquisition has been deferred until
March 2005. These acquisitions, by adding conceptual design and detailed
engineering skills, will enable us to better undertake all of the engineering
required on many of the large engineering, procurement, installation and
commission type contracts that we expect to come into the market in the next few
years.

                                       12
<Page>
CAPITAL EXPENDITURES

    Our capital expenditures for property, plant and equipment were
$62.9 million in 2001, $61.7 million in 2000 and $90.9 million in 1999. The
capital expenditures were financed by means of our operating cash flows and
additional funds drawn on new and existing credit facilities. There were no
significant divestitures during these periods.

    The table below sets forth information with respect to our principal capital
expenditures for fixed assets in each of the last three fiscal years, as well as
the amounts we have committed to spend in 2002. The ongoing capital expenditures
will be funded with cash from operations.

<Table>
<Caption>
                                                          COMMITTED
                                                            2002        2001       2000       1999
                                                          ---------   --------   --------   --------
                                                                       (IN $ MILLIONS)
<S>                                                       <C>         <C>        <C>        <C>
DESCRIPTION
Equipment and Asset Development.........................    19.7        38.0       42.5       51.0
Capacity Upgrades to Ships and Other Equipment..........    16.5        21.2        9.1       28.2
Other...................................................     5.9         3.7       10.1       11.7
                                                            ----        ----       ----       ----
Total...................................................    42.1        62.9       61.7       90.9
                                                            ====        ====       ====       ====
</Table>

BUSINESS SEGMENTS

    Our operations are managed through six regional offices: Aberdeen, Scotland
for the United Kingdom and Southern North Sea; Stavanger, Norway for the Norway
region; Singapore for Asia Pacific; Nanterre, France for Southern Europe, Africa
and the Middle East ("SEAME"); Macae City, Brazil for South America; and
Houston, Texas for the Gulf of Mexico. We provide our conceptual design and
engineering services for all regional operations through our offices in Houston,
Texas and Nanterre, France. We assemble and construct offshore infrastructure
equipment at our fabrication yards in Nigeria and Angola. Our principal
executive offices are located in Sunbury, near London, England.

                                       13
<Page>
    We have business segments based on the geographic distribution of the
activities as follows:

<Table>
<Caption>
SEGMENT                                                   GEOGRAPHIC COVERAGE
-------                                     ------------------------------------------------
<S>                                         <C>
Asia Pacific Region.......................  All activities east of the Indian sub-continent
                                            including Australasia
North America Region......................  All activities in Canada, the United States and
                                            Central America, including the Gulf of Mexico.
Norway Region.............................  All activities in Scandinavia and the Baltic
                                            states
SEAME Region..............................  All activities in Southern Europe, Africa, India
                                            and the Middle East
South America Region......................  All activities in South America and the islands
                                            in the southern Atlantic Ocean
U.K. Region...............................  All activities in the United Kingdom, Ireland,
                                            Germany, Belgium, The Netherlands and islands in
                                            the northern Atlantic Ocean
Corporate.................................  Includes items that cannot be allocated to one
                                            particular region, including:
</Table>

<Table>
<S>                                         <C>
                                            -  activities of the SHL and NKT joint ventures
                                            and the Paragon companies;
                                            -  global assets including all construction
                                            support ships and ROVs and related assets that
                                               are used globally and cannot be attributed to
                                               any one region;
                                            -  activities of Serimer Dasa, our welding
                                            technology company, in research and development
                                               of welding procedures and equipment; and
                                            -  management and corporate services provided
                                            for the benefit of our entire company including
                                               the engineering, finance and legal
                                               departments.
</Table>

ASIA PACIFIC REGION

    The Asia Pacific region is characterized by long distances between areas of
offshore oil operations and from other areas of the world that have offshore
development activities. We are active in ROV work, drilling support and subsea
construction in this region. In Indonesia, our operations are performed through
a subsidiary, PT Komaritim, which carries out shallow water pipelay and
construction work. The most significant project during fiscal year 2001 in this
region was the pipeline repair work undertaken for TFE E&P Indonesie in the
Makaham Delta.

U.K. REGION

    The U.K. region's business consists of pipelay and EPIC projects, subsea
construction, and inspection, maintenance and repair contracts. The majority of
these maintenance and repair contracts are short-term in nature. Included in
backlog for the U.K. region are: a long-term construction and maintenance
contract for BP, which is expected to be completed in 2005; the Corrib project
for Enterprise Oil; the BP Magnus E.O.R. project; and other subsea construction
projects.

NORWAY REGION

    The Norway region's business consists of pipelay and EPIC projects and
inspection, maintenance and drill support work for major oil producing
companies. We have undertaken a significant project with Shell (Draugen) which
involves pipelay and EPIC work. We have a long-term survey and pipeline
inspection contract with Statoil. We also have a long-term contract with Statoil
for construction and maintenance that is performed through our joint venture
with Halliburton.

                                       14
<Page>
SEAME REGION

    The majority of our business in the SEAME region is in West Africa and the
Middle East and involves pipelay and EPIC projects, subsea construction, field
development, drill support, diving and ROV services as well as the operation of
two fabrication yards. Significant projects undertaken in 2001 include the
development of the TotalFinaElf Girassol field and the Amerada Hess La Ceiba
field, and subsea construction projects with Mossgass. We also have pipelay and
EPIC projects with Shell, TotalFinaElf and ChevronTexaco. In 2001 we were
awarded the Shell Forcados Yokri field development and the installation of the
Shell Offshore Gas Gathering System, both of which are in Nigeria. We were also
awarded the Scarab and Saffron development for the Burullus Gas Company in the
Eastern Mediterranean.

SOUTH AMERICA REGION

    The majority of our operations in South America are located in Brazil, which
currently operates mostly as a single customer market controlled by Petrobras,
the Brazilian state oil company. Brazil has now opened offshore oil and gas
fields to foreign operators who will finance the growth of Brazilian offshore
oil production by means of production sharing contracts.

    The Brazilian market contains a number of large fields which are located in
deep water and will require extensive use of diverless subsea construction
techniques. We believe we are well positioned to capitalize upon our expertise
in these techniques.

    We currently have a four-year contract with an optional four-year extension
for the charter of the SEAWAY CONDOR with Petrobras which begins in August 2002
when its present contract will be completed. The ship will be upgraded for this
new contract. We also have a a two-year contract with Petrobras for the SEAWAY
HARRIER, which started in July 2001 and runs until July 2003. The contracts are
for flowline lay, diving support and ROV services. We also operate a number of
ROVs to provide construction and drilling support services, usually under
long-term contracts.

NORTH AMERICA REGION

    Based in Houston, Texas and Port of Iberia, Louisiana, our North American
regional business incorporates deepwater and shallow water pipelay and
construction work, dayrate diving and ROV inspection, repair and maintenance
work and the manufacture of sophisticated flanges and connectors for offshore
construction and repair works. A significant number of contracts in this region
are short-term construction, repair and maintenance projects. In 2001, we were
awarded a large pipelay project for Gulfstream Natural Gas LLC for the
installation of the Gulfstream natural gas transmission pipeline from
Mississippi Sound to Tampa Bay, Florida. This project is now close to
completion.

CORPORATE

    The Corporate segment includes activities that cannot be readily assigned to
a specific business segment due to the provision of services to our entire
company. These include the activities of SHL, a joint venture with a subsidiary
of the Russian oil company Lukoil; NKT; Serimer Dasa, a contract welding
services entity employed both onshore and offshore by pipelay contractors; and
the Paragon companies, now incorporating Litwin, which provide engineering
support particularly for large EPIC contracts. Also included in the Corporate
segment are global assets including all construction support ships, ROVs and
other deepsea assets that are used globally and therefore cannot be allocated to
any specific region, as well as management and corporate services for the
benefit of the entire company including the engineering, finance and legal
departments.

    The net operating revenue for each of our business segments for each of the
last three fiscal years is set forth under "Item 5. Operating and Financial
Review and Prospects."

                                       15
<Page>
MARKET, SALES AND COMPETITION

CUSTOMERS

    In 2001, we had 166 customers worldwide, of which 36 were major national and
international oil and gas companies. The level of construction services required
by any particular customer depends on the size of that customer's capital
expenditure budget devoted to construction plans in a particular year.
Consequently, customers that account for a significant portion of contract
revenue in one fiscal year may represent an immaterial portion of contract
revenue in subsequent fiscal years. In 2001, TotalFinaElf accounted for 24% of
our net operating revenue and Williams Gas accounted for 11% of our net
operating revenue. In 2000, TotalFinaElf accounted for 24%, and Shell accounted
for 10%, of our net operating revenue. During 2001 and 2000, our ten largest
customers accounted for 76% and 67%, respectively, of our net operating revenue,
and over that period seven customers, including BP, ChevronTexaco, Petrobras,
Shell, Statoil, TotalFinaElf and Triton Energy (acquired in 2001 by Amerada
Hess) consistently numbered among our ten largest customers.

COMPETITION

    The offshore contracting business is highly competitive. The consolidation
in the offshore oil and gas services industry in the last few years has resulted
in fewer but more substantial competitors. Although we believe that customers
consider, among other things, the availability and technical capabilities of
equipment and personnel, efficiency, condition of equipment, safety record and
reputation, price competition is the primary factor in determining which
qualified contractor with available equipment will be awarded a contract. Our
ships are specialized and have few alternative uses and, because of their nature
and the environment in which they work, have relatively high maintenance costs
whether or not operating. Because these costs are essentially fixed, and in
order to avoid additional expenses associated with temporarily idling its ships,
we may from time to time be required to bid our ships in projects at lower
margins depending on the prevailing contractual rates in a given region.

    We believe that we are one of only four companies capable of providing a
wide range of offshore services on a worldwide basis in the major offshore oil
and gas producing regions. Competition in most of the range of services that we
offer to our customers is limited to three main competitors, Technip-Coflexip,
the Halliburton-DSND joint venture, now trading under the name "Subsea 7" and
Saipem S.p.A. which has announced the imminent acquisition of another
competitor, Bouygues Offshore. We are subject to intense competition from these
offshore contractors. In North America, J. Ray McDermott Inc., Global
Industries Inc., Cal Dive International and Horizon Offshore Contractors Inc.
also provide similar services to those that we provide. Additionally, these
services are provided by J. Ray McDermott Inc. in Asia Pacific and the Middle
East and by Global Industries Inc. in Asia Pacific and West Africa. However, we
believe that these companies are not capable of operating in all the major oil
and gas producing regions worldwide. We also compete with Allseas Marine
Contractors and Heerema who operate in the worldwide market, providing trunkline
and rigid pipelay services and heavy lifting services, respectively. We also
face substantial competition from smaller regional competitors and less
integrated providers of offshore services.

SEASONALITY

    Over the past three years, a substantial proportion of our revenue has been
generated from work performed in the North Sea and North America. Adverse
weather conditions during the winter months in these regions usually result in
low levels of activity, although this is less apparent than in the past due to
technological advances. As a result, full-year results are not likely to be a
direct multiple of any particular quarter or combination of quarters.
Additionally, during certain periods of the year, we may be affected by delays
caused by adverse weather conditions such as hurricanes or tropical storms in
the Gulf of Mexico. During periods of curtailed activity due to adverse weather
conditions, we continue to incur operating expenses, but our revenues from
operations are delayed or reduced.

                                       16
<Page>
SUPPLIES AND RAW MATERIALS

    We generally do not manufacture the components used in the offshore services
that we provide, but rather supply, assemble and install equipment manufactured
by others. We coordinate our procurement and supply activities on a regional
basis with group level management overseeing the procurement and supply function
for all of our operations.

    The majority of raw materials that we use have not been subject to
significant price volatility; however, suppliers occasionally levy surcharges on
materials to reflect the escalation of fuel prices. We do not believe that
long-term contracts for the supply of materials are appropriate as there is
often a long lead time from the bid to contract award date, which can expose us
to price fluctuations in materials. We may be exposed to increased prices for
raw materials on individual contracts. We actively challenge suppliers to offer
competitive prices on materials by inviting bids for supply contracts and
introducing new suppliers. Over the last year, our results have not been
significantly affected by increased prices for raw materials.

INTELLECTUAL PROPERTY

    Under our intellectual property policy, we protect ourselves through
patents, publications and other means available. Some of our operations are
conducted under licensing agreements allowing us to make use of specific
techniques or equipment patented by third parties. However, none of the
operations conducted under patents held by us or under license agreements
represents a significant percentage of our net operating revenue.

RESEARCH AND DEVELOPMENT

    We have a long history of innovation and the development of new technologies
that have contributed significantly to the evolution of the offshore oil and gas
industry. Particular strengths include our construction techniques, which
include but are not limited to: deepwater pipeline laying and umbilicals, remote
intervention technologies and automated welding systems.

    Two of our notable developments are currently being used extensively in
water depth of 1,400 meters. These developments are our J-Lay tower on the
SEAWAY POLARIS used to lay pipeline, which enables rigid pipe to be laid from
the barge at a steep angle allowing for efficient pipelay, and MATIS-TM-, an
automatic bolted flange connection system for deepwater pipeline spools. A
deepwater pipeline spool is a length of pipe, typically between 20 and 100
meters in length that connects a subsea pipeline to a structure on the seabed.
Our MATIS-TM- trademark is registered in the United Kingdom and Norway and is
currently in the process of U.S. federal trademark registration.

    Serimer Dasa, our welding technology company, continues to improve welding
procedures and equipment to meet the technical demands of both new steels and
riser installation techniques. Among the research and development programs
currently in progress are the development of high speed welding techniques for
large diameter pipelines, the welding of high strength steels, the development
of laser welding techniques and a number of studies relating to the fabrication
and inspection of steel catenary risers.

    A major problem facing the offshore oil and gas industry is the repair of
damaged pipelines in water depths that are too deep for divers. Such repairs
must be made by robotic means, which is both time-consuming and costly. We are
developing a number of solutions to this problem based on the MATIS-TM-tie-in
equipment and the friction stitch welding process. The development of this
process will offer significant advantages to subsea pipeline operators who will
no longer be required to hold inventories of expensive repair connectors. If
these technologies are developed successfully, we will be able to provide repair
services to subsea pipeline customers quickly by using off-the-shelf flange
connectors or friction stitch welding.

    Our current research and development program also includes elements of
architecture of a field development, which includes but is not limited to
different types of risers or flowline systems including

                                       17
<Page>
insulation, coating, buoyancy and conditions monitoring to be offered to
customers as part of their infrastructure to produce and transport hydrocarbons
in deepwater.

    Our research and development activities are primarily customer and project
specific development efforts that we undertake to tailor equipment and systems
to the needs of a customer in connection with specific orders or projects.
Order-related development amounts are paid by customers as part of the contract
price.

OTHER MATTERS

SAFETY AND QUALITY ASSURANCE

    We maintain a stringent quality assurance program encompassing all areas of
our operations in accordance with ISO 9001, an international standard
established by the International Organization for Standardization to certify
quality assurance systems. Each of our regional operations has dedicated safety
and quality assurance staff who are responsible for overseeing the projects in
that particular region. In addition, a quality assurance manager located in
Aberdeen, Scotland formulates corporate quality assurance policies, and oversees
the implementation and enforcement of such policies on a company-wide basis.

RISKS AND INSURANCE

    Our operations are subject to all the risks normally associated with
offshore development and production and could result in damage to or loss of
property, suspension of operations or injury or death to personnel or third
parties. We insure our assets at levels which our management believes reflect
their current market value. Such assets include all capital items such as ships,
major equipment and land-based property. The only assets not insured are those
where the cost of such insurance would be disproportionate to their value. We
believe our insurance should protect against, among other things, the cost of
replacing our ships as a result of total or constructive total loss.

    Our operations are conducted in hazardous environments where accidents
involving catastrophic damage or loss of life could result, and litigation
arising from such an event may result in us being named a defendant in lawsuits
asserting large claims. We insure ourselves for liability arising from our
operations, both onshore and offshore, including loss of or damage to
third-party property, death or injury to employees or third parties, statutory
workers compensation protection and pollution. Although there can be no
assurance that the amount of insurance we carry is sufficient to protect us
fully in all events, all such insurance is carried at levels of coverage and
deductibles that we consider financially prudent. A successful liability claim
for which we are underinsured or uninsured could have a material adverse effect
on us.

CLIENT FINANCIAL STANDING AND CREDIT RISK

    We believe we take appropriate measures to protect against the risk of our
clients' inability to pay. Our clients range from global oil companies to
medium-sized offshore operators and contractors and project consortiums.
Generally, where the contract counterparty is a major oil company, we do not
require any evidence of ability to pay and we rely on the credit of such
company. Where the contract counterparty is a newly-formed project consortium or
otherwise gives us reason to believe that we may be assuming some credit risk,
we take steps to mitigate that risk. The specific steps we take vary according
to the financial status of our clients. Where appropriate, we assist our client
in obtaining project financing, but we do not require project financing to be in
place in all cases before we execute a contract. Before starting work for
smaller clients, we obtain credit agency references. Furthermore, we limit our
risk of nonpayment by structuring our contract to provide for progress payments
or payments based on milestones. Because our remuneration typically does not
depend on the volume of oil or gas that our clients ultimately extract, our
pre-contractual procedures do not include verification of recoverable reserves.

                                       18
<Page>
GOVERNMENT REGULATION

    Our business is subject to international conventions and governmental
regulations that strictly regulate various aspects of our operations. The
maritime laws and the diving, health and safety regulations of the jurisdictions
in which we operate govern our operations in these areas. In the North Sea,
these regulations include established working hours and a specified working
environment for divers, as well as standards for diving procedures, equipment
and diver health. The North Sea standards are among the most stringent in the
world. In the absence of any specific regulation in other geographic regions, we
closely follow the standards set by the International Marine Contractor
Association.

    Our operations in the United Kingdom are subject to a variety of employee
and European community safety laws. The Health and Safety at Work Act of 1974,
and regulations made thereunder, mandate general requirements for safe
workplaces for all employees. Similar regulations apply in Norway, France and
other European countries in which we operate.

    In the United States, we are subject to the jurisdiction of the U.S. Coast
Guard, the National Transportation Safety Board and the U.S. Customs Service, as
well as private industry organizations such as the American Bureau of Shipping.
The Coast Guard and the National Transportation Safety Board set safety
standards and are authorized to investigate vessel accidents and recommend
improved safety standards. The Customs Service is authorized to inspect vessels
at will. The exploration and development of oil and gas properties located on
the Outer Continental Shelf of the United States is regulated by the Minerals
Management Service. Our U.S. operations are also affected by numerous federal,
state, and local laws and regulations relating to safety and health of employees
and protection of the environment including the Occupational Safety & Health Act
of 1970, the Resource Conservation & Recovery Act of 1976, the Outer Continental
Shelf Lands Act of 1953, the Federal Water Pollution Control Act of 1972, and
the Oil Pollution Act of 1990.

    The International Maritime Organization recently made the regulations of the
International Safety Management (ISM) Code mandatory. The ISM Code provides an
international standard for the safe management and operation of ships, pollution
prevention and certain crew and vessel certifications which is effective, unless
extended by governmental authorities, on July 1, 2002. We believe that we are
currently in compliance with these standards or will be in compliance in all
relevant jurisdictions by the effective date.

    Compliance with current environmental, safety and other laws and regulations
is an ordinary part of our business. These laws change frequently and, as an
ordinary part of our business, we incur costs to maintain compliance with such
laws. Although these costs have not had a material impact on our financial
condition or results of operations in recent years, there can be no assurance
that they will not have such an impact in the future. Moreover, although it is
our objective to maintain compliance with all such laws and regulations
applicable to us, there can be no assurance that we will avoid material costs,
liabilities and penalties imposed as a result of governmental regulation in the
future.

    In addition, we are required by various governmental and other regulatory
agencies, including the agencies referred to above to obtain certain permits,
licenses and certificates with respect to our equipment and operations. The kind
of permits, licenses and certificates required in our operations depends upon a
number of factors but are normally of a type required of all operators in a
given jurisdiction. We believe that we have or can readily obtain all permits,
licenses and certificates necessary to conduct our operations. Some countries
require that we enter into joint venture or similar business arrangements with
local individuals or businesses in order to conduct business in such countries.

    Our operations are affected from time to time and to varying degrees by
political developments and federal and local laws and regulations. In
particular, oil and gas production operations and economics are affected by
price control, tax and other laws relating to the petroleum industry, by

                                       19
<Page>
changes in such laws and by constantly changing administrative regulations. Such
developments directly or indirectly may affect our operations and those of our
customers.

INSPECTION BY A CLASSIFICATION SOCIETY AND DRYDOCKING

    The hull and machinery (including diving equipment) of most of our ships
must be "classed" by a classification society authorized by its country of
registry. The classification society certifies that the ship is safe and
seaworthy in accordance with the classification rules as well as with applicable
rules and regulations of the country of registry of the ship and the
international conventions of which that country is a member. Certain of our
ships are not required to be classed, but do comply with applicable regulations.

    Each classed ship is inspected by a surveyor of the classification society.
A visual inspection is carried out annually to ascertain the general condition
of the ship or relevant items. Intermediate surveys are carried out at the
second or third annual survey. This survey includes a visual inspection of the
hull structure, machinery and electrical installations and equipment. Renewal
surveys which involve a major inspection of the hull structure, machinery
installations and equipment are carried out at five-year intervals. A classed
ship is also required to be drydocked every 30 to 36 months for inspection of
the underwater parts of the ship. As a general policy, we drydock our classed
ships every second year during the winter off-season. Should any defect be
found, the classification society surveyor will issue its report as to
appropriate repairs which must be made by the ship owner within the time limit
prescribed. Insurance underwriters make it a condition of insurance coverage
that a classed ship be "in class," and all of our major classed ships currently
meet that condition.

    Our U.S. flagged ships that are U.S. Coast Guard inspected but not classed
are drydocked twice during each five-year cycle. The intermediate drydocking is
due between the end of the second and third years of the cycle. Our U.S. flagged
Load Line only ships as well as the un-classed Panama and Honduras flagged ships
are drydocked according to the same schedule for condition surveys as required
by the respective national Load Line regulations. The annual topside safety and
equipment surveys are very similar to and parallel the traditional class
surveys.

SIGNIFICANT SUBSIDIARIES

    Our significant subsidiaries are set out in the table below.

<Table>
<Caption>
COMPANY NAME                                             COUNTRY OF INCORPORATION   PERCENTAGE OF OWNERSHIP
-------------------------------------------------------  ------------------------   -----------------------
<S>                                                      <C>                        <C>

Stolt Offshore S.A.                                      France                               100%

Stolt Offshore Inc.                                      U.S.                                 100%

Stolt Offshore A/S                                       Norway                               100%

Class 3 Shipping Ltd.                                    Bermuda                              100%

Stolt Offshore B.V.                                      The Netherlands                      100%

Stolt Offshore Services S.A.                             France                               100%

Stolt Offshore S.A.                                      Brazil                               100%

Stolt Offshore Limited                                   United Kingdom                       100%

SCS Shipping Limited                                     Isle of Man                          100%
</Table>

                                       20
<Page>
DESCRIPTION OF PROPERTY

MAJOR ASSETS


    The following table describes our major assets as of May 31, 2002:


<Table>
<Caption>
                                                                                    LENGTH
                                                      YEAR BUILT/                   OVERALL
NAME                          CAPABILITIES           MAJOR UPGRADE        ROVS     (METERS)    OWNED/CHARTERED
----                     -----------------------  -------------------   --------   ---------   ----------------
<S>                      <C>                      <C>                   <C>        <C>         <C>
CONSTRUCTION SUPPORT SHIPS
SEAWAY HARRIER.........  Subsea construction                     1985       1          84             Owned(1)
SEAWAY HAWK............  Subsea construction                     1978      --          93             Owned
SEAWAY OSPREY..........  Flexible flowline and         1984/1992/1996       2         102             Owned(1)
                         umbilical lay, accepts
                         coiled tubing,
                         straightener for
                         tubing, stern roller
SEAWAY EAGLE...........  Flexible flowline lay,                  1997       2         140             Owned(1)
                         multi-purpose subsea
                         construction
SEAWAY LEGEND..........  ROV and hardsuit diving            1985/1998       2          73             Owned
                         support, subsea
                         construction
DISCOVERY..............  Flexible flowline lay,                  1990       1         120         Chartered(2)
                         subsea construction
SEAWAY KINGFISHER......  Diverless inspection,              1990/1998       2          90         Chartered(3)
                         repair and maintenance
STEPHANITURM...........  Diving support, light         1978/1994/1995       1          73         Chartered(4)
                         construction
SEAWAY EXPLORER........  Trenching ship                          1984      --          80             Owned(1)

FLOWLINE LAY SHIPS
SEAWAY CONDOR..........  Flexible flowline and         1982/1994/1999       2         141             Owned(1)
                         umbilical lay, module
                         handling system,
                         trenching
SEAWAY FALCON..........  Rigid and flexible            1976/1995/1997       2         162             Owned(1)
                         flowline and umbilical
                         lay
SEAWAY POLARIS.........  Deepwater derrick/           1979/1991/1996/      --         137             Owned
                         pipelay barge                           1999
SEAWAY KESTREL.........  Rigid reel lay ship           1976/1991/1995      --          99             Owned(1)

SURVEY / IRM SHIPS
SEAWAY COMMANDER.......  Survey                        1967/1982/1988       2          75         Chartered(5)
SEAWAY DEFENDER........  ROV and hardsuit diving                 1976       1          67             Owned
                         support, subsea
                         construction
SEAWAY PIONEER.........  ROV and hardsuit diving            1966/1996       1          64             Owned
                         support, subsea
                         construction
SEAWAY INVINCIBLE......  ROV support, subsea                     1971      --          71             Owned
                         construction
SEAWAY ROVER...........  ROV support, subsea          1966/1972/1983/      --          71             Owned
                         construction                            1991
ELANG LAUT.............  Multi-role shallow                      1978      --          35             Owned
                         seismic/multibeam
                         survey and geotechnical
                         service ship
FAR SAGA...............  ROV support, subsea                     2001       2          89         Chartered(6)
                         construction
POLAR BJORN............  ROV support, subsea                     2001       2          90         Chartered(7)
                         construction
ERNEST SHACKLETON......  ROV support, subsea                     1999       2          80         Chartered(8)
                         construction
</Table>

                                       21
<Page>


<Table>
<Caption>
                                                                                    LENGTH
                                                      YEAR BUILT/                   OVERALL
NAME                          CAPABILITIES           MAJOR UPGRADE        ROVS     (METERS)    OWNED/CHARTERED
----                     -----------------------  -------------------   --------   ---------   ----------------
<S>                      <C>                      <C>                   <C>        <C>         <C>
ANCHORED CONSTRUCTION &
  MAINTENANCE SHIPS
AMERICAN PRIDE.........  Four-point anchor                  1977/1992      --          59             Owned
                         system
AMERICAN                 Four-point anchor                       1974      --          64             Owned
  CONSTITUTION.........  system, saturation
                         diving, moonpool
AMERICAN EAGLE.........  Four-point anchor                       1976      --          50             Owned
                         system
AMERICAN INDEPENDENCE..  Four-point anchor                       1970      --          52             Owned
                         system
AMERICAN RECOVERY......  Tug, diving support                1965/1995      --          43             Owned
AMERICAN STAR..........  Four-point anchor                  1967/1998      --          53             Owned
                         system, saturation
                         diving
AMERICAN TRIUMPH.......  Four-point anchor                  1965/1997      --          53             Owned
                         system
AMERICAN VICTORY.......  Four-point anchor                  1976/1997      --          50             Owned
                         system
AMERICAN LIBERTY.......  Four-point anchor                       1974      --          33             Owned
                         system
PIPELINE SURVEYOR......  Diving support                     1965/1996      --          33             Owned
AMERICAN DIVER.........  Diving support                          1964      --          33             Owned

HEAVY LIFT SHIPS AND BARGES
STANISLAV YUDIN........  Heavy lift, 2,500-ton                   1985      --         183         Chartered(9)
                         crane
ANNETTE................  Pipelay barge, marine         1972/1989/1997      --          61             Owned
                         construction
ARWANA.................  Pipelay barge                           1998      --          70             Owned
JASAMARINE V (EX SIN     Flat top barge fitted                   1978      --          55             Owned
  THAI HIN IV).........  out for inshore diving/
                         construction
SEAWAY ORION...........  Pipelay barge                 1977/1984/1997      --          85             Owned
DLB 801................  Derrick lay barge             1978/1980/1989      --         107             Owned
LB 200.................  Pipelay barge                      1975/1996      --         168             Owned(1)
CBL 103................  Seagoing barge                1975/1985/1996      --          91             Owned

TUGS AND OTHER
GOLEK..................  Transport barge                    1983/1992      --          46             Owned
POLKA..................  River tug and anchor                    1971      --          12             Owned
                         handler
SEAWAY SABIA...........  Anchor Mooring support                  2002      --          37             Owned
DLB 1..................  Barge                                   1956      --          91             Owned
</Table>


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

(1) Subject to mortgage under our current credit facilities.

(2) Chartered from Friary Ocean Surveyor NV through September 2002, with options
    to extend through 2011 and with options to purchase.

(3) Chartered from Kingfisher DA in which we have a 50% ownership, for five
    years starting in 1998, with 10 one-year options to extend through
    December 2013 and with options to purchase.

(4) Chartered from Horizon Offshore from March 1, 2000 through February 2003
    with 2 one-year options to extend.

(5) Chartered from DSND Shipping A/S through December 2002.

(6) Chartered from Farstad Supply AS for five years beginning in 2002 with three
    one-year options to extend.

(7) Chartered from Polar Ship Investment AS for three years beginning in 2002.

(8) Chartered from Silverseas Shipping Limited for one year beginning in 2001
    with four one-year options to extend.

(9) Chartered to SHL by a subsidiary of the ship's owner, Lukoil, through
    October 2004.

OTHER PROPERTIES

    As of April 30, 2002, we owned or held under long-term leases real estate
property as described below:

<Table>
<Caption>
                                                                            WORK OR STORAGE
                                                                               SPACE OR
                                                           OFFICE SPACE      LAND (SQUARE
                                                          (SQUARE METERS)       METERS)          STATUS
                                                          ---------------   ---------------   -------------
<S>                                                       <C>               <C>               <C>
Aberdeen, Scotland......................................       6,028            102,793       Owned/Leased
Baku, Azerbaijan........................................          66                 --          Leased
Bergen, Norway..........................................         100                 --          Leased
Buenos Aires, Argentina.................................         100                 --          Leased
</Table>

                                       22
<Page>

<Table>
<Caption>
                                                                            WORK OR STORAGE
                                                                               SPACE OR
                                                           OFFICE SPACE      LAND (SQUARE
                                                          (SQUARE METERS)       METERS)          STATUS
                                                          ---------------   ---------------   -------------
<S>                                                       <C>               <C>               <C>
Cairo, Egypt............................................         250                 --          Leased
Dhahran, Saudi Arabia...................................         330                750          Leased
East Kalimantan, Indonesia..............................          --            190,267          Leased
Houston, Texas..........................................       5,156              2.971          Leased
Houston, Texas..........................................      10,105             15,633          Leased
Jakarta, Indonesia......................................         915                601          Leased
Kristiansund, Norway....................................         120                800          Leased
Lagos, Nigeria..........................................         200                 --          Leased
Lobito, Angola..........................................       5,945            554,431          Leased
Luanda, Angola..........................................          53                690          Leased
Macae City, Brazil......................................       1,286             20,300       Owned/Leased
Nanterre, France........................................      22,364                 --          Leased
New Orleans, Louisiana..................................         305             56,658          Leased
Perth, Australia........................................       1,456              3,818          Leased
Port Gentil, Gabon......................................         305              5,070          Owned
Port of Fourchon, Louisiana.............................         650             74,240          Leased
Port of Iberia, Louisiana...............................       1,796             95,688          Leased
Rio de Janeiro, Brazil..................................         295                 --          Owned
Rotterdam, The Netherlands..............................          --              4,200          Leased
Rueil, France...........................................       5,235                 --          Leased
Sharjah, United Arab Emirates...........................       1,570              5,147          Leased
Singapore...............................................         928              4,606          Leased
Stavanger, Norway.......................................       7,721                562          Leased
Sunbury, England........................................         616                 --          Leased
Tananger, Norway........................................         250             18,200          Leased
Tchengue, Gabon.........................................       1,486             60,000          Leased
Teeside, England........................................          --             19,667          Leased
Tehran, Iran............................................         600                 --          Leased
Warri, Nigeria..........................................       1,765            222,582          Leased
</Table>


ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS.



    We are one of the largest offshore services contractors in the world. We
design, procure, build, install and service a range of offshore surface and
subsurface infrastructure for the global oil and gas industry. We specialize in
creating and applying innovative and efficient solutions in response to the
technical complexities faced by offshore oil and gas companies as they explore
and develop production fields in increasingly deeper water and more demanding
offshore environments. Our revenues for the year ended November 30, 2001 were
$1.3 billion, and our order backlog on June 15, 2002 was $1.6 billion, as
compared to our order backlog of $1.7 billion at June 15, 2001. Of the June 15,
2002 backlog amount, we expect that $0.8 billion will be recognized as revenue
in 2002 and $0.8 billion will not be filled in the current year.



    In this section, we explain our general financial condition and the results
of our operations. As you read the following discussion and analysis, you should
refer to our Consolidated Financial Statements and the related notes thereto for
fiscal years 2001, 2000 and 1999 included in this Report.



SHIP UTILIZATION



    The following table sets forth the average ship utilization by fiscal
quarter for our fleets of dynamically positioned deepwater heavy construction
ships, light construction and survey ships and trunklines, barges and anchor
ships. The utilization rate is calculated by dividing the total number of days
for which the ships were engaged in project-related work in a quarter by
87.5 days per quarter or


                                       23
<Page>

350 days annually, expressed as a percentage. The remaining 15 days are
attributable to routine maintenance.



<Table>
<Caption>
                                                                                UTILIZATION RATE
                                                              ----------------------------------------------------
                                                               QTR 1      QTR 2      QTR 3      QTR 4       YEAR
                                                              --------   --------   --------   --------   --------
<S>                                                           <C>        <C>        <C>        <C>        <C>
Deepwater Heavy Construction Ships
2001........................................................     80%        85%        93%        94%        88%
2000........................................................     69%        74%        77%        93%        78%
1999........................................................     95%        92%        97%        75%        90%
Light Construction and Survey Ships
2001........................................................     43%        52%        85%        84%        66%
2000........................................................     36%        42%        64%        49%        48%
1999........................................................     64%        62%        67%        54%        62%
Trunklines, Barges and Anchor Ships
2001........................................................     34%        47%        66%        75%        56%
2000........................................................     31%        30%        36%        45%        35%
1999........................................................     33%        33%        55%        40%        40%
</Table>



    Utilization of the deepwater heavy construction fleet in 2001 was higher
than in 2000. This was a result of growth in demand in the North Sea, Gulf of
Mexico and West Africa, particularly on the ship-intensive Girassol project.
Utilization in 2000 was lower than in 1999, due in part to the non-availability
of the SEAWAY CONDOR and low utilization of the SEAWAY POLARIS resulting from
poor market conditions in the United Kingdom and North America. The poor market
conditions in 2000 were more pronounced for the light construction and survey
fleet and the trunkline, barges and anchor fleet.



    We expect the demand for our fleets to remain stable in 2002 due to a
sustained level of demand in our main operating markets. The market growth in
2002 is primarily in West Africa in the form of large projects in which the
procurement and engineering phases of those projects occupy the early years,
having little or no impact on our fleet utilization.



RESULTS OF OPERATIONS



    The following table shows annual net operating revenue and income before tax
(after minority interests) for each of our business segments for the past three
fiscal years.



    The Asia Pacific region includes all activities east of the Indian
sub-continent including Australasia; the North America region includes all
activity in Canada, the United States and Central America; the Norway region
includes all activities in Scandinavia and the Baltic states; the SEAME region
covers activities in Southern Europe and Africa, India and the Middle East; the
South America region includes activities in South America and the islands of the
southern Atlantic Ocean; the U.K. region includes all activities in the United
Kingdom, Ireland, Germany, Belgium, The Netherlands and the northern Atlantic
Ocean.



    The Corporate segment includes items which cannot be allocated to one
particular region. These include the activities of Seaway Heavy Lifting Limited
("SHL"), a joint venture with a subsidiary of the Russian oil company
Lukoil-Kaliningradmorneft plc ("Lukoil"); NKT; Serimer DASA, a contract welding
services entity employed both onshore and offshore by pipelay contractors; and
Paragon Engineering Services, Inc. and Paragon Litwin S.A., both of which
provide engineering services for the offshore oil and gas industry. Also
included in the Corporate segment are assets which have global mobility
including construction support ships, ROVs and other assets that are used
globally and therefore cannot be attributed to any one region; and management
and corporate services provided for the benefit of the whole group, including
the engineering, finance and legal departments.


                                       24
<Page>


<Table>
<Caption>
                                                                 YEAR ENDED NOVEMBER 30,
                                             ---------------------------------------------------------------
                                                    2001                  2000                  1999
                                             -------------------   -------------------   -------------------
                                                $          %          $          %          $          %
                                             --------   --------   --------   --------   --------   --------
                                                                     ($ IN MILLIONS)
<S>                                          <C>        <C>        <C>        <C>        <C>        <C>
NET OPERATING REVENUE
Asia Pacific region........................      39.4       3.2       40.5        4.1       42.7        6.7
North America region.......................     276.7      22.0      122.3       12.4      156.4       24.4
Norway region..............................     110.6       8.8      198.8       20.2      164.5       25.7
SEAME region...............................     520.2      41.4      444.9       45.2       57.1        8.9
South America region.......................      50.5       4.0       52.8        5.4       56.4        8.8
U.K. region................................     214.7      17.1      123.6       12.6      162.0       25.3
Corporate..................................      43.8       3.5        0.5        0.1        1.6        0.2
                                             --------    ------     ------     ------    -------     ------
    TOTAL..................................   1,255.9     100.0      983.4      100.0      640.7      100.0
                                             ========    ======     ======     ======    =======     ======

NET (LOSS) INCOME BEFORE TAX (AFTER
  MINORITY INTERESTS)
Asia Pacific region........................        --        --      (14.9)     (39.0)      (5.0)     (64.9)
North America region.......................     (36.2)   (565.6)     (21.2)     (55.5)      (6.1)     (79.2)
Norway region..............................      11.7     182.8        3.0        7.9       15.8      205.2
SEAME region...............................      24.5     382.8       20.1       52.6        3.4       44.1
South America region.......................       5.5      85.9        8.4       22.0        8.8      114.3
U.K. region................................       1.3      20.3       (9.2)     (24.1)       0.5        6.5
Corporate..................................      (0.4)     (6.2)     (24.4)     (63.9)      (9.7)    (126.0)
                                             --------    ------     ------     ------    -------     ------
    TOTAL..................................       6.4     100.0      (38.2)    (100.0)       7.7      100.0
                                             ========    ======     ======     ======    =======     ======
</Table>



OVERALL



    Net operating revenue increased to $1,255.9 million in 2001 from
$983.4 million in 2000 largely due to greater activity on major projects in the
Gulf of Mexico and West Africa. During the year, the Girassol and Gulfstream
projects suffered from project delays, cost overruns and delays in settling
variation orders which negatively impacted our results. The project delays also
tied up some of our major construction assets reducing our capacity to
participate in the spot market which can be significant in the second half of
the year. Despite these factors, the improved market conditions resulted in an
improvement in the results before tax (after minority interests) from a loss of
$38.2 million last year to a profit before tax (after minority interests) in
2001 of $6.4 million.



    In 2000, net operating revenue increased to $983.4 million from
$640.7 million in 1999 largely as a result of the acquisition of ETPM; the
majority of this increase was in West Africa. There were poor market conditions
in the United Kingdom, North America and Asia Pacific and severe project delays
in the North Sea in the first quarter due to adverse weather conditions. Poor
project performance in the North Sea and Asia Pacific also had a significant
negative impact on earnings. The poor market conditions together with the
interest expense incurred on borrowings, which increased as a result of the ETPM
acquisition, also contributed to a decrease in net income before tax (after
minority interests) from $7.7 million in 1999 to net a loss before tax (after
minority interests) of $38.2 million in 2000.



ASIA PACIFIC REGION



    In 2001, net operating revenue remained stable at $39.4 million compared to
$40.5 million in 2000. We will continue to focus on our established core
business of shallow water pipelay and diving work mostly in Indonesia until more
of the planned deepwater developments for this region come to the market, but
for 2002 it is likely that there will be a similar level of activity as seen in
2001.


                                       25
<Page>

    Net operating revenue decreased from $42.7 million in 1999 to $40.5 million
in 2000. This was due to a slight deterioration in the market for ROVs and in
the Indonesian market in general.



    In 2001, a break-even result compared to a net loss before tax (after
minority interests) of $14.9 million in 2000. The improvement in 2001 was the
result of efforts carried out in 2000 to reduce the local fixed cost structure
and focus on the target niche market, and the poor performance in 2000 on two
projects in Indonesia was not repeated.



    In 2000, the net loss before tax (after minority interests) of
$14.9 million compared to a net loss before tax (after minority interests) of
$5.0 million in 1999. This loss largely resulted from poor project performance
on two projects in Indonesia where unexpected soil conditions made the trenching
of two pipelines very difficult.



NORTH AMERICA REGION



    Net operating revenue increased from $122.3 million in 2000 to
$276.7 million in 2001. Contrary to expectations, higher oil and gas prices did
not result in improved margins during 2001, although they did increase the level
of activity in the region with the pipelay project for Gulfstream National Gas
LLC (a joint venture between Duke Energy and Williams Companies) contributing to
this increase.



    Although there are a number of bids now coming into the market for larger
field developments such as the BP Thunder Horse field, it is expected that the
activity level in the Gulf of Mexico in 2002 will decrease compared to 2001 as
the Gulfstream project is expected to be completed in the third quarter of 2002.
It is also anticipated that there will be some slight strengthening of margins
for local business in 2002.



    Net operating revenue decreased from $156.4 million in 1999 to
$122.3 million in 2000. The year was disappointing due to the very poor market
conditions in the Gulf of Mexico where activity levels were at a 30-year low due
to the depressed price for oil and gas for most of 2000.



    Poor performance on the Gulfstream project resulted in an increased net loss
before tax (after minority interests) in 2001 of $36.2 million compared to a net
loss before tax (after minority interests) in 2000 of $21.2 million. Margins on
other activity in the Gulf of Mexico have been increased by cost reduction
actions in 2000 and exiting non-profitable businesses. In 2000, poor market
conditions resulted in a net loss before tax (after minority interests) of
$21.2 million, which compared to a net loss before tax (after minority
interests) in 1999 of $6.1 million.



NORWAY REGION



    Net operating revenue in 2001 was $110.6 million compared to $198.8 million
in 2000. The decrease was due to the absence of any major pipelay projects. In
general, the market in Norway in 2002 will be similar to 2001 although the
market for inspection, maintenance and repair work on producing fields is one
that continues to grow throughout the North Sea. As a result, a strong profit
performance is anticipated in 2002.



    Net operating revenue in 2000 was $198.8 million compared to $164.5 million
in 1999. The increase in 2000 was due to improvements in the market for ROV
services and additional projects undertaken as a result of the ETPM acquisition.



    Net income before tax (after minority interests) in 2001 was $11.7 million
compared to a net income before tax (after minority interests) of $3.0 million
in 2000. This improvement was largely due to the good performance on subsea
construction projects.



    Net income before tax (after minority interests) in 2000 was $3.0 million
compared to $15.8 million in 1999. This decrease was largely the result of
project delays caused by adverse weather conditions


                                       26
<Page>

early in the year, which resulted in a negative adjustment to our expected
profitability on the Halfdan project, offset by a favorable revision on the
Shell Draugen contract resulting from additional variation order income.



SEAME REGION



    Net operating revenue has increased to $520.2 million in 2001 compared to
$444.9 million in 2000. This increase is largely the result of the Girassol
project in Angola and traditional pipelay contracts on offshore projects in
Nigeria.



    We expect the offshore market in West Africa to more than double in 2002.
Several new large field developments are expected to be awarded to subsea
contractors in 2002 including the ChevronTexaco Agbami project, the ExxonMobil
Ehra project and the TotalFinaElf Dahlia project. We have bid on, or expect to
bid on several of these projects, but there is no guarantee that they will be
awarded to us or, if any project is awarded to us, that we will generate revenue
in 2002 from such projects. In May 2002, we and a joint venture partner were
awarded the ChevronTexaco Sanha Bomboco project, a $660.0 million EPIC contract
for the engineering, fabrication and installation of five offshore platforms in
West Africa, the modification of three existing platforms and the installation
of 100 kilometers of subsea pipelines in an average water depth of 100 meters.
Our share of the project represents $240.0 million, of which we expect to
recognize $15.0 million as revenue in 2002.



    Net operating revenue in 2000 of $444.9 million compared favorably to net
operating revenue in 1999 of $57.1 million. The increase was due to the
acquisition of ETPM, which has the majority of its activities in the SEAME
region.



    Net income before tax (after minority interests) was $24.5 million in 2001
compared to $20.1 million in 2000 and $3.4 million in 1999. The increase in 2001
is due to successful progress on several major turnkey projects, notably Amenam,
Hyundai South Pars and Triton La Ceiba. The increase also includes a favorable
adjustment to the Girassol project of $2.4 million, reflecting successful
negotiations with subcontractors which lowered our costs.



    Net income before tax (after minority interests) in 2000 was $20.1 million
compared to $3.4 million in 1999. The low net income in 2000, and particularly
in 1999, reflect high procurement content and winter contracts undertaken at
lower margins than would have been achieved during the summer in order to
prevent vessels lying idle.



SOUTH AMERICA REGION



    Net operating revenue was down slightly at $50.5 million in 2001, compared
to $52.8 million in 2000 and $56.4 million in 1999. The reduction in net
operating revenue was due primarily to the expiry in early 2001 of a long-term
diving contract in Argentina.



    Revenue in 2002 is likely to stay flat although there are some new
construction projects starting to emerge, such as the Bijupera and Salema fields
for Enterprise Oil plc and the Roncador and Albacora Leste fields for Petrobras.
It is not expected that these projects will have any effect before 2003.



    Revenue in 2000 was impacted by the currency devaluation in Brazil, where
some of our revenues are in local currency, partially offset by compensation
from Petrobras under the contract and savings on local costs, which are also
denominated in local currency.



    Net income before tax (after minority interests) for 2001 of $5.5 million
was a reduction from $8.4 million in 2000 and $8.8 million in 1999. The fall in
profitability was due to the expiry of the Argentina diving contract.


                                       27
<Page>

U.K. REGION



    Net operating revenue in 2001 was $214.7 million, compared to
$123.6 million in 2000. The increase in revenue is due to the improved market
conditions in the region. The market for 2002 in the U.K. region is expected to
remain similar to 2001.



    In 2000, revenue decreased from $162.0 million in 1999 to $123.6 million in
2000. This was entirely due to the poor market conditions in the region
resulting from a slow recovery after a period of low oil prices and
consolidation among our customers whose capital expenditure plans were delayed
as a result.



    The net income before tax (after minority interests) of $1.3 million was an
improvement compared to the net loss before tax (after minority interests) of
$9.2 million in 2000. The increased market activity and the better asset
utilization largely explains this improvement.



    The net loss before tax (after minority interests) of $9.2 million in 2000
deteriorated from net income before tax (after minority interests) of
$0.5 million in 1999 largely due to the reduced market activity in the region,
which reduced margins and impaired asset utilization. The 2000 loss also
includes the impact of negative adjustment to the Wintershall contract due to
unexpectedly adverse soil conditions, which delayed trenching operations and
adversely affected our expected profitability on the contract.



CORPORATE



    Corporate items represent activities that are not directly attributable to
specific regions. This item includes revenues generated by our specialist
engineering and welding subsidiaries in respect of work performed for third
parties. The net residual costs incurred centrally are also included, net of
amounts charged to other group businesses.



    Net operating revenue in 2001 amounted to $43.8 million compared to
$0.5 million in 2000 and $1.6 million in 1999. The increase largely results from
the acquisition of Paragon Engineering Services, Inc. and Ingerop Litwin, a
Paris-based engineering company.



    Net loss before tax (after minority interests) for 2001 was $0.4 million
compared to losses of $24.4 million in 2000 and $9.7 million in 1999. Certain
expenditures are incurred centrally on behalf of all of our business segments,
including interest and ship-owning costs. These costs are recovered from the
regional operations based upon their expected pro rata utilization of shared
company resources and assets. The losses primarily result from interest expense
and asset utilization costs which were not billed to the regions.



DEPRECIATION AND AMORTIZATION



    Depreciation and amortization in 2001 was $91.8 million, compared to
$82.1 million in 2000. The increase was due to a larger fixed asset base and the
writedown of certain small assets. Amortization of the goodwill arising on the
acquisition of Ceanic amounted to $5.0 million in 2001.



    Depreciation and amortization in 2000 of $82.1 million compared to
$56.1 million in 1999. This increase was due largely to the assets acquired with
ETPM. Amortization of the goodwill on Ceanic amounted to $5.0 million in 2000.



EQUITY IN NET INCOME OF NON-CONSOLIDATED JOINT VENTURES



    Equity in net income of non-consolidated joint ventures in 2001 was
$11.7 million, compared to $5.8 million in 2000 and $5.2 million in 1999. The
increase in 2001 was largely due to the successful year for joint venture
operations in the North Sea.


                                       28
<Page>

    The increase in 2000 over 1999 was largely due to the Mar Profundo Girassol
joint venture that is included in the SEAME region.



ADMINISTRATIVE AND GENERAL EXPENSES



    Administrative and general expenses in 2001 were $64.0 million, compared to
$60.9 million and $51.8 million in 2000 and 1999, respectively. The increase in
2001 was largely due to the acquisitions of Paragon and Litwin.



    The increase in 2000 over 1999 was largely due to the full year effect of
the ETPM acquisition.



IMPAIRMENT AND RESTRUCTURING CHARGES



    In 2001, in light of the increased worldwide recognition of the Stolt
Offshore name, we determined that the value of the former Comex trade name had
been impaired and recorded a charge of $7.9 million in its results of operations
for the write-down of the trade name.



    During 2000, following the acquisition of ETPM, we implemented a
reorganization plan to remove duplicate capacity in the U.K. and SEAME regions.
The costs associated with closing ETPM's United Kingdom offices were
$1.0 million after tax, and were capitalized as adjustments to the purchase
price of ETPM. A further $0.9 million was incurred for redundancies in the
United Kingdom. In France, redundancy costs of $1.7 million were incurred to
close our Marseille office. Finally, costs of $0.7 million were incurred to
integrate systems and standardize processes across our enlarged operations. All
redundancy, integration and lease costs have been fully paid, and there is no
outstanding provision for such costs at November 30, 2001.



NON-OPERATING (EXPENSE) INCOME



    NET INTEREST EXPENSE



    In 2001, net interest expense decreased to $26.8 million from $30.0 million
in 2000. This decrease was due primarily to reductions in interest rates during
the year.



    In 2000, net interest expense increased to $30.0 million from $16.7 million
in 1999. This increase resulted primarily from the acquisition of ETPM, which
was partly debt financed.



    OTHER INCOME, NET



    In 2001, we recognized other non-operating income of $2.3 million. This
primarily related to a gain of $1.2 million on the sale of the assets of Hard
Suits Inc., a specialized diving company.



INCOME TAX PROVISION (BENEFIT)



    We recorded a net tax charge of $20.6 million in 2001, compared to a net tax
benefit of $3.8 million in 2000, and a net tax benefit in 1999 of $8.5 million.



    In 2001, the tax charge largely resulted from withholding taxes imposed by
tax authorities in certain territories in West Africa which had higher revenue
in 2001 than in previous years. Additionally, in the current year, we did not
recognize a net deferred tax asset for the losses in the North America Region as
had been done in previous years.



    Partially offsetting these items was the release of a portion of the
deferred tax liability for accelerated United Kingdom shipping allowances as a
result of the United Kingdom shipping companies electing to join the United
Kingdom tonnage tax regime.


                                       29
<Page>

    The tax credit in 2000 largely resulted from poor results in the North Sea
and North America where deferred tax assets were recognized.



    The tax credit in 1999 mainly resulted from the disappointing year in the
North America region, where substantial pre-tax losses were recognized.



SHARE CAPITAL AND EARNINGS PER SHARE



    On March 7, 2001, our non-voting Class A Shares were reclassified as Common
Shares on a one-for-one basis. The objective of the reclassification was to
create a simplified and more transparent share capital structure to give all
shareholders a vote on all matters and to increase the liquidity of the Common
Share public float by approximately 50%.



    As a result of this reclassification, we had outstanding 70.2 million Common
Shares and 34.0 million Class B Shares (which are economically equivalent to
17.0 million Common Shares and are all owned by SNSA) for a total of
87.2 million Common Share equivalents. The reclassification did not change the
underlying economic interests of existing shareholders or the number of shares
used for earnings per share purposes.



SHARE REPURCHASES



    On December 7, 1999, we acquired a 49% interest in the joint venture NKT. As
partial consideration for the acquisition of our interest, we issued to NKT
Holding 1,758,242 Class A Shares, which were reclassified as Common Shares in
March 2001. In accordance with the terms of the purchase agreement for our joint
venture interest, a group company purchased 249,621 Common Shares from NKT
Holding at a guaranteed price of $13.65 per share for an aggregate price of
$3.4 million in February 2002. These shares were later transferred to Stolt
Offshore Investing Ltd.



    In December 1999, we acquired ETPM from Vinci's predecessor, Groupe GTM. The
total consideration for this acquisition, including debt assumed, was
approximately $350.0 million, funded partly by cash and partly by the issuance
of 6,142,857 Class A Shares. On March 7, 2001, our Class A Shares, including the
shares held by Vinci, were reclassified as Common Shares on a one-for-one basis.
The purchase agreement effectively provided that in the event of a sale of
Vinci's Stolt Offshore shares, Vinci would receive a minimum of $18.50 per
share. In accordance with the terms of the purchase agreement, in May 2002 Stolt
Offshore Investing Ltd. purchased all these shares from Vinci. The total payment
for the shares of $113.6 million was made in two tranches: on May 3, 2002 Stolt
Offshore Investing Ltd. paid a total of $54.7 million, based on the then current
market value per share; on May 14, 2002, we paid the remaining $58.9 million to
Vinci pursuant to our obligation under the ETPM agreement to satisfy the
guaranteed price. The latter payment reflected the difference between that
aggregate market value paid by Stolt Offshore Investing Ltd. and the guaranteed
aggregate price of $113.6 million. We incurred $110.0 million of debt for these
purposes in May 2002, including $65.0 million borrowed from SNSA and
$45.0 million borrowed from banks under our credit facilities.



LIQUIDITY AND CAPITAL RESOURCES



    Our primary liquidity needs are to fund working capital, capital
expenditures and drydock costs. Our principal sources of funds have been cash
generated from operations, borrowings from commercial banks and SNSA and the
issuance of share capital.



    Our principal credit facility is a $440 million Secured Multi-Currency
Revolving Facility (referred to as the "Secured Credit Facility") with a
syndicate of banks, the lead banks being Den norske Bank ASA, Banc of America
LLC, Salomon Brothers International Limited, HSBC Bank plc and ING Barings LLC.


                                       30
<Page>

    The Secured Credit Facility was entered into on September 22, 2000, and is a
five-year revolving credit facility which reduces to $385 million on August 31,
2002 and $330 million on August 31, 2003. The interest rate on outstanding debt
is based on the ratio of our debt to earnings before interest, taxes,
depreciation and amortization. The interest charge will range from 0.75% to
1.75% over the London InterBank Offer Rate, commonly known as LIBOR. Debt under
the Secured Credit Facility is secured by a first mortgage on certain of our
ships and barges.



    As of November 30, 2001, we had available bank facilities of
$485.9 million, of which $340.2 million were utilized. As of April 30, 2002, we
had available bank facilities of $485.9 million of which $370.0 million were
utilized. Of the bank facilities utilized, all $370.0 million was classified as
long-term debt.



    Net cash provided by operating activities was $4.5 million during 2001
compared to $58.2 million in 2000. Improved operating performance in 2001 was
largely offset by a build up in working capital, particularly unbilled
receivables from customers, where under the terms of the contract, invoices
cannot yet be raised. Average accounts receivable increased to 125 days at
November 30, 2001 from 111 days at November 30, 2000. Accounts payable days of
134 days at November 30, 2001 compared to 131 days in 2000.



    Net cash provided by operating activities during 2000 was $58.2 million
compared to $40.3 million in 1999. Average accounts receivable days outstanding
decreased slightly to 111 days at November 30, 2000 from 113 days at
November 30, 1999. Average accounts payable days outstanding of 131 days at
November 30, 2000 compared to 91 days in 1999.



    The other year to year fluctuations in cash from operating activities are
due to fluctuations in net operating income as discussed under "--Results of
Operations."



    Net cash used in investing activities in 2001 was $71.2 million compared to
$160.6 million in 2000. In 2001, the acquisition of Paragon and Litwin accounted
for $0.1 million, net of cash acquired, $62.9 million was used to purchase fixed
assets, $26.1 million was paid in respect of investments in non-consolidated
joint ventures and dividends of $12.2 million were received from
non-consolidated joint ventures.



    Net cash used in investing activities in 2000 was $160.6 million compared to
$75.8 million in 1999. In 2000, $111.2 million, net of cash acquired, was paid
to acquire ETPM and 49% of NKT, $61.7 million was used to purchase fixed assets
and $6.9 million was paid in respect of investments in joint ventures. Partially
offsetting these expenditures was $19.2 million for the proceeds from the sale
of fixed assets. Net cash used in investing activities in 1999 was
$75.8 million. The $90.9 million paid to purchase fixed assets was partially
offset by dividends from joint ventures of $11.6 million and proceeds from sales
of fixed assets of $2.8 million.



    Net cash provided by financing activities in 2001 was $72.5 million,
compared to $103.8 million in 2000 and $34.7 million in 1999. In 2001, this was
composed of an increase in long-term debt of $70.0 million, a $3.3 million
additional drawdown on short-term facilities, a $2.6 million decrease of
restricted cash and a $3.8 million repayment of capital lease obligations. In
2000, net cash provided by financing activities mainly comprised the proceeds of
$199.8 million from the issuance of 19,775,223 Class A Shares for further
investment from SNSA; a net increase in long-term debt of $14.4 million was
offset by the $104.3 million repayment of short-term facilities most of which
were assumed through the acquisition of ETPM; the $5.4 million repayment of
capital lease obligations; and a $2.6 million increase in restricted cash. In
1999, the net cash provided by financing activities mainly comprised an increase
in long-term debt of $32.6 million, $5.6 million additional drawdown on
short-term facilities, $1.0 million increase of restricted cash and
$3.1 million repayment of capital lease obligations.


                                       31
<Page>

    In February 2002, one of our group companies purchased 249,621 shares from
NKT for an aggregate purchase price of $3.4 million. In May 2002, our indirect
wholly owned subsidiary, Stolt Offshore Investing Ltd., purchased 6,142,847 of
our Common Shares from Vinci. The aggregate purchase price that Stolt Offshore
Investing Ltd. paid for the Common Shares and the payment that we made in
settlement of the associated minimum share price guarantee was $113.6 million.
We incurred $110.0 million of debt for these purposes in May 2002, including
$65.0 million borrowed from SNSA and $45.0 million borrowed from banks under our
Secured Credit Facility. This purchase was treated as a reduction in
shareholders' equity. Under the Secured Credit Facility, we are required to
maintain compliance with financial covenants, including covenants relating to
tangible net worth. Our compliance with these covenants was measured as at
May 31, 2002. If we had prepared these financial covenant calculations on an
actual basis, we would have been out of compliance in respect of a financial
covenant relating to tangible net worth as we would have been required to reduce
our tangible net worth by $113.6 million for the purchase of the Common Shares
from Vinci, but we would not have been able to increase tangible net worth by
the proceeds from the sale of the Common Shares that we planned to offer
pursuant to a registration statement filed with the Securities and Exchange
Commission in April 2002, unless and until those proceeds were received. We
obtained consent from the banks participating in the Secured Credit Facility to
calculate the financial covenants on a pro forma basis so as account for the
sale of Common Shares pursuant to the offering as if the sale had taken place by
May 31, 2002. When the covenant calculations were prepared on this basis, and
assuming at least $20.0 million of net proceeds to us, we were in compliance
with the covenants under the facility. The bank consent was applicable through
June 30, 2002. On June 24, 2002, we determined to postpone the public offering
of our Common Shares due to unfavorable market conditions. On June 26, 2002,
SNSA enchanged $24.0 million of debt that we owed to SNSA for 3.0 million Common
Shares at an exchange price of $8.00 per share. This exchange brought us into
compliance with the tangible net worth covenants of the Secured Credit Facility.



    During 2002, we expect to make capital expenditures of approximately
$42.1 million of which approximately $15.1 million was committed at
November 30, 2001. In January 2002, we exercised the early purchase option on a
hire purchase arrangement for two barges for $23.6 million. Expected debt
service is $25.1 million for the year 2002. Based on the current level of
activity, cash provided from operations is expected to be approximately
$112.0 million, which results in a funding requirement for the expenditures
discussed above of approximately $116.0 million. This funding requirement will
be met through the use of existing credit facilities, the exchange of
$24.0 million of debt for equity with SNSA and bank commitments to provide a new
$100.0 million revolving credit facility.



    The following table sets forth our contractual obligations and other
commercial commitments as at November 30, 2001:



<Table>
<Caption>
                                                                         LESS
                                                                         THAN       1-3        4-5      AFTER 5
                                                             TOTAL      1 YEAR     YEARS      YEARS      YEARS
                                                            --------   --------   --------   --------   --------
                                                                                    ($ IN MILLIONS)
<S>                                                         <C>        <C>        <C>        <C>        <C>
CONTRACTUAL OBLIGATIONS
Long-term debt............................................   335.0         --        5.0      330.0         --
Capital lease obligations.................................    23.7       23.7         --         --         --
Operating leases..........................................   103.6       25.8       38.4       25.1       14.3
    Total.................................................   462.3       49.5       43.4      355.1       14.3
OTHER COMMERCIAL COMMITMENTS
Performance guarantees....................................   418.2      263.3       99.0       44.5       11.4
</Table>



    We have an outstanding guarantee in favor of NKT Holdings guaranteeing that
879,121 Common Shares in Stolt Offshore paid as part consideration when we
acquired 49% of NKT can be sold for a minimum of $15.30 per share. This
guarantee expires on December 7, 2002. The guarantee will apply to any Common
Shares held by NKT Holdings on December 7, 2002 and is subject to the conditions
that the average closing price of the Common Shares during the twenty days
immediately preceding


                                       32
<Page>

December 7, 2002 is less than $15.30 per share, and that the price of the Common
Shares not having been $16.30 or more during any period of twenty-five
consecutive trading days since December 7, 1999. We have an option to organize
the sale of the shares which are subject to this guarantee.



MULTI-CURRENCY ACTIVITIES



    Our reporting currency is the U.S. dollar. The majority of net operating
expenses are denominated in the functional currency of the individual operating
subsidiaries. The U.S. dollar is the functional currency of the most significant
subsidiaries within the Asia Pacific, North America, SEAME and South American
regions. In the Norway and U.K. regions, the functional currencies are the
Norwegian kroner and the British pound, respectively.



    We enter into forward exchange and options contracts to hedge capital
expenditures and operational non-functional currency exposures on a continuing
basis for periods consistent with our committed exposures. We do not engage in
currency speculation.



MARKET RISK



    We are exposed to market risk, including changes in interest rates and
currency exchange rates. To manage the volatility relating to these exposures on
a consolidated basis, we enter into derivative instruments to hedge currency
exposures in accordance with our policies. The financial impact of these
instruments is offset by corresponding changes in the underlying exposures being
hedged. We do not hold or issue derivative instruments for trading purposes.



CURRENCY RATE AND INTEREST RATE EXPOSURE



    Our exposure to currency rate fluctuations results from our net investments
in foreign subsidiaries, primarily in the United Kingdom, Norway, France and
Brazil, and from our share of the local currency earnings in our operations in
the United Kingdom, Norway and SEAME. We are also exposed to fluctuations in
several other currencies resulting from operating expenditures and one-off
liabilities.



    Our currency rate exposure policy prescribes the range of allowable hedging
activity. We primarily use forward exchange contracts. We do not use derivative
instruments to hedge the value of investments in foreign subsidiaries.



    Our exposure to third-party interest rate fluctuations results primarily
from floating-rate short-term lines of credit as well as floating-rate long-term
revolving credit facilities tied into LIBOR.



    We use a value-at-risk ("VAR") model to estimate the maximum potential loss
on financial instruments that could occur from adverse movements in either
interest rates or foreign exchange rates, which uses a variance/covariance
modeling technique. The VAR model uses historical foreign exchange rates and
interest rates to estimate the volatility and correlation of these rates in
future periods. It estimates a potential one-day loss in the fair market value
of the instruments using statistical modeling techniques and including
substantially all market risk exposures, specifically excluding joint venture
investments. The VAR model estimates were made assuming normal market conditions
and a 95% confidence level.



    The 95% confidence level signifies our degree of confidence that actual
losses would not exceed the estimated losses shown in the table below. The
amounts shown here disregard the possibility that interest rates and foreign
currency rates could move favorably. The VAR model assumes that all movements in
these rates would be adverse. Actual experience has shown that gains and losses
tend to offset each other over time, and it is highly unlikely that we could
experience losses such as these over an extended period of time. These amounts
should not be considered to be projections of future losses, since actual
results may differ significantly depending upon activity in the global financial
markets.


                                       33
<Page>

    The fair value losses shown in the table below have no impact on our results
or financial condition.



<Table>
<Caption>
                                                              VAR
                                                      --------------------
                                                       AS OF NOVEMBER 30
                                                      --------------------
                                                        2001        2000
                                                      --------    --------
                                                        ($ IN MILLIONS)
<S>                                                   <C>         <C>
Interest rates....................................       0.4         1.3
Foreign exchange rates............................       0.9         1.1
</Table>



    A discussion of our accounting policies for financial instruments is
included in Note 2 to the Consolidated Financial Statements, and disclosure
relating to the financial instruments is included in Note 23 to the Consolidated
Financial Statements.



CRITICAL ACCOUNTING POLICIES



    Our significant accounting policies are described in Notes 2 and 10 to the
Consolidated Financial Statements. We believe that the following policies are
the critical accounting policies as they may involve a high degree of judgment
and complexity.



REVENUE RECOGNITION



    A significant portion of our revenue is derived from long-term contracts and
is recognized using the percentage-of-completion accounting method. Under the
percentage-of-completion method, estimated contract revenues are accrued based
on the ratio of costs incurred to date to the total estimated costs, taking into
account the level of estimated physical completion. Management reviews these
estimates monthly and revenue and gross profit are recognized each period unless
the stage of completion is insufficient to enable a reasonably certain forecast
of revenue to be established. Since the financial reporting of these contracts
depends on estimates, which are assessed continually during the term of these
contracts, recognized revenues and profit are subject to revisions as the
contract progresses to completion. Revisions in profit estimates are reflected
in the period in which the facts that give rise to the revision become known.
Accordingly, favorable changes in estimates result in additional revenue and
profit recognition, and unfavorable changes in estimates result in a reduction
of recognized revenue and profits. These changes may be significant depending on
the size of the project or the adjustment. When estimates indicate that a loss
will be incurred on a contract on completion, a provision for the expected loss
is recorded in the period in which the loss becomes known.



    A major portion of our revenue is billed under fixed-price contracts.
However, due to the nature of the services performed, variation orders are
commonly billed to the customers in the normal course of business and are
recognized as contract revenue only after agreement from the customers has been
reached on the scope of work and fees to be charged. Variation orders often
arise during the life of a contract and estimated revenues and costs are
adjusted for change orders that have been approved as to scope and fees.



    The net effect on net (loss) income of significant revisions to contract
estimates was $2.4 million, $(10.7) million and $0.0 million in 2001, 2000 and
1999, respectively. The net effect of these revisions on net (loss) income per
share was $0.03, $(0.14) and $0.0 in 2001, 2000 and 1999, respectively.



    In 2001, the positive adjustment resulted from improvements on the Girassol
project reflecting successful negotiations with subcontractors. In 2000, the
reasons for the negative revisions were operational and related to unexpected
physical conditions encountered during the execution of the contracts. Cost
overruns were incurred on two contracts in the North Sea, one due to adverse
weather conditions and the other due to adverse soil conditions which delayed
trenching operations. This was offset by a favorable revision in another
project, resulting from the agreement of additional variation orders during the
year.


                                       34
<Page>

RECOGNITION OF PROVISIONS FOR LEGAL CLAIMS, SUITS AND COMPLAINTS



    In the ordinary course of business, we are subject to various claims, suits
and complaints. Management, in consultation with internal and external advisers,
will provide for a contingent loss in the financial statements if the
contingency had been incurred at the date of the financial statements and the
amount of the loss can be reasonably estimated. In accordance with SFAS No. 5,
"Accounting for Contingencies" if we have determined that the reasonable
estimate of the loss is a range and that there is no best estimate within the
range, we will provide the lower amount of the range. The provision is subject
to uncertainty and no assurance can be given that the amount provided in the
financial statements is the amount that will be ultimately settled. Our results
may be adversely affected if the provision proves not to be sufficient. The
notable legal claims made against us are discussed fully in Note 22 to the
Consolidated Financial Statements and are summarized below.



    Coflexip S.A. has commenced legal proceedings through the United Kingdom
High Court against three of our subsidiaries claiming infringement of a certain
patent held by Coflexip relating to flexible flowline laying technology in the
United Kingdom. Judgment was rendered on January 22, 1999 and January 29, 1999.
The disputed patent was held valid. We appealed, and the Appeal Court maintained
the validity of the patent and broadened its application compared to the High
Court decision. We applied for leave to appeal the Appeal Court decision to the
House of Lords, which has now been denied. The result of these court decisions
is that the flexible lay system tower on SEAWAY FALCON and the process by which
this system lays flexible conduits, has been held to infringe Coflexip's patent
in the United Kingdom. During 2001, Coflexip submitted an amended claim for
damages claiming lost profits on a total of 15 projects. In addition, there is a
claim for alleged price depreciation on certain other projects. The claim is for
approximately $89.0 million, up from approximately $14.0 million claimed
previously, plus interest, legal costs and a royalty for each time that the
flexible lay system tower on the SEAWAY FALCON was brought into U.K. waters. We
estimate that the total claim will amount to approximately $115.0 million. In
the alternative, Coflexip claims a reasonable royalty for each act of
infringement, interest and legal costs. Coflexip has not quantified this claim,
but we expect that it will be considerably less than the claim to lost profits.
We, in consultation with our advisers, have assessed that the range of possible
outcomes for the resolution of damages is $1.5 million to $115.0 million and
have determined that there is no amount within the range that is a better
estimate than any other amount. Consequently, in accordance with SFAS No. 5, we
have reserved $1.5 million in the financial statements, this being the lower end
of the range.



    In September 1999, we terminated our charter of the ship, TOISA PUMA, for
default. We are currently in arbitration with the owners, who are contesting
that the termination was wrongful. During 2001, the owner has quantified his
claim to approximately $8.0 million. We have disputed the magnitude of the claim
in relation to lack of instigation, lack of cost savings and lack of actual loss
for parts of the claim. In addition, we have a counterclaim related to the
breakdown of the ship. In consultation with our advisers, we have assessed the
range of possible outcomes for the resolution of damages with the upper amount
being $8.0 million. We have determined that there is no amount within the range
that is a better estimate than any other amount. Consequently, in accordance
with SFAS No. 5, we have reserved $2.0 million in the financial statements, an
amount to cover the liability for damages which is at the lower end of the
range. The amount of such liability is nevertheless uncertain and no assurance
can be given that the provided amount is sufficient.



INCOME TAXES



    We account for income taxes in accordance with SFAS No. 109, "Accounting for
Income Taxes" which requires that the deferred tax assets and liabilities be
recognized using enacted tax rates for the effect of temporary differences
between book and tax bases of recorded assets and liabilities. SFAS No. 109 also
requires that the deferred tax assets be reduced by a valuation allowance if it
is more likely than not that some portion or all of the deferred tax asset will
not be realized.


                                       35
<Page>

    As at November 30, 2001 and 2000, we had deferred tax assets in excess of
deferred tax liabilities of $52.0 million and $7.9 million, respectively. For
the reasons cited below, as at November 30, 2001, management determined that it
is more likely than not that $13.0 million and $13.7 million, respectively, of
such assets will be realized, resulting in a valuation allowance of
$57.1 million and $21.0 million, respectively. We evaluate quarterly the
realizability of our deferred tax assets by assessing our valuation allowance
and by adjusting the amount of such allowance, if necessary. The factor used to
assess the likelihood of realization is our forecast of future taxable income.
Factors that may affect our ability to achieve sufficient forecasted taxable
income include, but are not limited to, the following: increased competition, a
decline in sales or margins or loss of market share.



IMPLEMENTATION OF SFAS NO. 133



    Effective December 1, 2000, we adopted SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities," as amended, which requires that
all derivative instruments be reported on the balance sheet at fair value and
establishes criteria for designation and effectiveness of hedging relationships.
The impact of adopting this standard on December 1, 2000 was to increase forward
contract liabilities by $4.9 million and forward contract assets by
$2.7 million, with an offsetting amount of $2.2 million recorded in other
comprehensive income.



IMPACT OF NEW ACCOUNTING STANDARDS



    In July 2001, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 141, "Business Combinations" and SFAS No. 142, "Goodwill and Other
Intangible Assets." SFAS No. 141 applies to all business combinations with a
closing date after June 30, 2001 and eliminates the pooling-of-interests method
of accounting and further clarifies the criteria for recognition of intangible
assets separately from goodwill. SFAS No. 142 eliminates the amortization of
goodwill and indefinite-lived intangible assets and initiates an annual review
for impairment. Identifiable intangible assets with determinable useful lives
will continue to be amortized. The amortization provisions apply to goodwill and
to other intangible assets acquired after June 30, 2001. Goodwill and other
intangible assets acquired prior to June 30, 2001 will be affected upon
adoption. We will adopt SFAS No. 142 for the fiscal year commencing December 1,
2002 which will require us to cease amortization of our remaining net goodwill
balance and perform an impairment test of our existing goodwill based on a fair
value concept. We have not determined the impact that these statements will have
on goodwill and other intangible assets or whether a cumulative effect
adjustment will be required upon adoption to reflect the impairment of
previously recognized goodwill and other intangible assets.



    In June 2001, FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations." SFAS No. 143 requires that the fair value of a liability for an
asset retirement obligation be recognized in the period in which it is incurred
if a reasonable estimate of fair value can be made. The associated asset
retirement costs are capitalized as part of the carrying amount of the
long-lived asset. Changes in the liability for an asset retirement due to the
passage of time shall be recognized as an increase in the carrying amount of the
liability and as an operating expense in the statement of operations. SFAS
No. 143 is effective for fiscal years beginning after June 15, 2002. We do not
anticipate that adoption of SFAS No. 143 will have a material impact on our
results of operations or our financial position.



    In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment
or Disposal of Long-Lived Assets." SFAS No. 144 superseded SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed Of." SFAS No. 144 primarily addresses significant issues relating to
the implementation of SFAS No. 121 and develops a single accounting model for
long-lived assets to be disposed of by sale that is consistent with the
fundamental provisions of SFAS No. 121. SFAS No. 144 is effective for fiscal
years beginning after December 15, 2001. We currently have no plans to dispose
of any operations and, accordingly, do not anticipate that adoption of SFAS
No. 144 will have a material impact on our results of operations or our
financial position.


                                       36
<Page>

    In April 2002, the FASB issued SFAS No. 145 "Rescission of FASB Statements
No. 4, 44 and 64, Amendment of FASB Statement No. 13 and Technical Corrections."
The principal change is that gains or losses from extinguishment of debt which
are classified as extraordinary items by SFAS No. 4 will no longer be classified
as such. The provisions of SFAS No. 145 are effective for fiscal years beginning
after May 15, 2002, although early application of the statement related to the
rescission of SFAS No. 4 is encouraged. We plan to adopt SFAS No. 145 for the
fiscal year ending November 30, 2003.


RECENT DEVELOPMENTS


    In May 2002, we and a joint venture partner were awarded the ChevronTexaco
Sanha Bomboco project, a $660.0 million EPIC contract for the engineering,
fabrication and installation of five offshore platforms in West Africa, the
modification of three existing platforms and the installation of 100 kilometers
of subsea pipelines in an average water depth of 100 meters. Our share of the
project represents $240.0 million, of which we expect to recognize
$15.0 million as revenue in 2002.



    On June 24, 2002, we determined to postpone the public offering of our
Common Shares due to unfavorable market conditions. On June 26, 2002, we
exchanged with SNSA $24.0 million principal amount of outstanding debt owing by
us to SNSA for 3.0 million Common Shares at an exchange price of $8.00 per
share.



    We have agreed with AAUK that the firm will formally resign as our
independent auditors on July 31, 2002. Our board of directors is expected to
decide upon the selection of new auditors in August 2002, which will be subject
to the approval of our shareholders. See "Item 3. Key Information--Other
Matters."


ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES.

DIRECTORS AND SENIOR MANAGEMENT

    Stolt Offshore is a Luxembourg holding company and does not have officers as
such. The following is a list of our Directors and persons employed by our
subsidiaries who perform the indicated executive and administrative functions
for the combined business of our subsidiaries:

<Table>
<Caption>
NAME                                          AGE*     POSITION
----                                        --------   --------
<S>                                         <C>        <C>
Jacob Stolt-Nielsen.......................     70      Chairman of the Board of Directors
James B. Hurlock..........................     69      Director
Haakon Lorentzen..........................     47      Director
Fernand Poimboeuf.........................     69      Director
J. Frithjof Skouveroe.....................     58      Director
Niels G. Stolt-Nielsen....................     37      Director
                                                       Director and Chief Executive
Bernard Vossier...........................     57      Officer
Mark Woolveridge..........................     67      Director
Alan Brunnen..............................     41      Chief Operating Officer
Bruno Chabas..............................     37      Chief Financial Officer
Jean Coombes..............................     53      Director of Human Resources
Joel Leroux...............................     55      Director of Product Lines
Johan Rasmussen...........................     46      Group General Counsel
</Table>

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

*   As of May 02, 2002.

    Under the terms of our Articles of Incorporation, our Directors may be
elected for terms of up to six years and serve until their successors are
elected. It has been our practice to elect directors for one-year terms. Under
the Articles, the Board must consist of not fewer than three Directors.

    Mr. Jacob Stolt-Nielsen has served as Chairman of the Board of Stolt
Offshore S.A. since 1993. He is currently Chairman of the board of SNSA and
served as Chief Executive Officer of Stolt-Nielsen

                                       37
<Page>
S.A. from 1959 until November 2000. He founded Stolt-Nielsen Seaway AS in 1973.
He holds a degree from Handelsgymnasium, Haugesund, Norway. He is a Norwegian
citizen.

    Mr. Hurlock was appointed a Director of Stolt Offshore in February 2002. He
is a retired partner of the law firm of White & Case LLP and served as the
Chairman of its Management Committee from 1980 to 2000. He participated in the
formation and served on the Board of Northern Offshore Ltd, which during the
1970s operated diver lock-out submarines and provided other services to the
offshore industry. He holds a BA degree from Princeton University, a M.A.
Jurisprudence from Oxford University and a J.D. from Harvard Law School. He is a
U.S. citizen.

    Mr. Lorentzen was elected as a Director in May 2002. He is Managing Director
of Lorentzen Empreendimentos SA of Rio de Janiero, a diversified holding company
with investments in Aracrus Celulose SA, Cia Norsul Navegacao and a diversified
IT portfolio. He is also a director of Aracrus Celulose, Ideiasnet, Advicenet,
Intellibridge, CEAL and WWF Brazil. He holds a Bachelors Degree in Economics
from Pontificia Universidade Catalica do Rio de Janeiro and a Harvard Business
School Post Graduate Degree. He is a resident of Brazil. He is a Norwegian
citizen.

    Mr. Poimboeuf has been a Director since 1998. He has had a career of
33 years with Elf Aquitaine that included periods as Deputy General Manager in
Gabon, Executive Vice President of Texagulf Inc. in Houston and General Manager
in Angola. He graduated from the Ecole de Mines in Paris and specialized in
Petroleum Engineering at the University of Texas. He is a French citizen.

    Mr. Skouveroe has been a Director since 1993. He is the Owner and Chairman
of Concentus AS, a Norwegian/Swedish Industrial Group. He is also a member of
the Board of Ocean Rig ASA, an offshore drilling contractor listed on the Oslo
Stock Exchange. He was Chairman of the Board and Chief Executive Officer of
Stolt-Nielsen Seaway A/S ("Seaway") from 1990 until it was acquired by SNSA in
1992. From 1985 to 1990 he was President and Second Vice Chairman of Seaway.
From 1982 until 1985 he served as the President of Stolt-Nielsen Seaway
Contracting AS, a predecessor to Seaway. He holds an MBA from INSEAD and a
Masters degree in Mechanical Engineering from the Technical University of
Norway. He is a Norwegian citizen.

    Mr. Niels G. Stolt-Nielsen has been a Director since 1999.
Mr. Stolt-Nielsen has also served as a Director of SNSA since 1996. In
November 2000, he was appointed to the position of Chief Executive Officer of
SNSA. From 1996 until September 2001 he held the position of Chief Executive
Officer, Stolt Sea Farm. He previously worked in Stolt Nielsen Tanker Group
("SNTG"). He is the son of Mr. Jacob Stolt-Nielsen. He graduated from Hofstra
University in 1990 with a BS degree in Business and Finance. He is a Norwegian
citizen.

    Mr. Vossier has been a Director since 2000 and has served as Chief Executive
Officer of Stolt Offshore since May 1995. He previously served as Chief
Operating Officer of Stolt Offshore from December 1994 to May 1995. He joined
Comex in 1974 and has held numerous management positions in operations and
marketing. He has a degree in General Mechanics from the Technical School of St.
Vallier. He is a French citizen.

    Mr. Woolveridge has been a Director since 1993 and was elected Deputy
Chairman on February 18, 2002. He held a number of positions with BP since 1968
and most recently served as the Chief Executive of BP Engineering from 1989
until his retirement in 1992. He was also General Manager, Oil and Gas
Developments, responsible for field development projects in the United Kingdom
and Norwegian sectors of the North Sea, and served on the board of BP Oil Ltd.
He holds a Masters degree from Cambridge University and is a Fellow of the Royal
Academy of Engineering and of the Institute of Mechanical Engineers. He is a
British citizen.

    Mr. Brunnen was appointed Chief Operating Officer in February 1999. He
joined Seaway in 1992 and was involved in managing several major projects prior
to his appointment as Vice President, United Kingdom in 1995. Prior to his
appointment as Chief Operating Officer, he held the position of Vice President,
Organization and Process Development from February 15, 1998. He is a British
citizen.

                                       38
<Page>
    Mr. Chabas was appointed Chief Financial Officer in June 1999. He joined
Stolt Offshore in 1992, working first in business development project analysis
in Aberdeen, then as General Manager of Sogetram and Deputy General Manager of
our SEAME region. In 1997 he was put in charge of developing new markets in the
Gulf of Mexico. He is a French citizen.

    Jean Coombes was appointed Director of Human resources on joining Stolt
Offshore in March 2001. She has held various senior Human Resource Manager
positions with BP Exploration, was the Human Resources Manager for Oryx UK
Energy and was a partner in an independent human resource consultancy since
1997. She has an honors degree in Chemistry from Durham University and is a
member of the Chartered Institute of Personnel and Development. She is a British
citizen.

    Mr. Leroux was appointed Director of Product Lines in December 1999
following the acquisition of ETPM. He joined ETPM in 1972 and held several
management positions with ETPM including Chief Operating Officer. He holds a
degree in Mechanical Engineering from Ecole Nationale Superieure des Arts et
Metiers. He is a French citizen.

    Mr. Rasmussen joined Seaway in 1988 as an in-house legal advisor and was
promoted to the position of Group General Counsel in March 1996. Prior to
joining Stolt Offshore, he served with a sub-division of the Norwegian Ministry
of Defense and as a Deputy Judge. He is a Norwegian citizen.

COMPENSATION OF DIRECTORS AND OFFICERS

    As described above, Stolt Offshore does not have officers, but certain
persons employed by our subsidiaries perform executive and administrative
functions for the combined business of its subsidiaries. The aggregate annual
compensation paid to the seven officers performing such executive functions for
the group, for the fiscal year ended November 30, 2001, (including certain
benefits) was $1,440,000. In addition, $100,000 was contributed on behalf of
such officers to defined contribution pension plans. During 2001, our Directors
who were affiliated with Stolt Offshore or a subsidiary of SNSA received no
compensation for their services, as such, but received reimbursement of their
out-of-pocket expenses. Each of our non-executive directors received an annual
fee of $20,000 plus reimbursement of their out-of-pocket expenses in 2001. In
addition, each of our non-executive directors who are members of the audit
committee receive an annual fee of $5,000 and non-executive directors on the
compensation committee receive an annual fee of $5,000.

INCENTIVE PLANS

    We have a Profit Sharing Plan which pays 10% of Stolt Offshore's net profit
(after specified adjustments) to our officers and employees worldwide other than
those covered by collective bargaining agreements. The determination of an
employee's individual award is based on performance, salary and overall
contribution to Stolt Offshore. The Profit Sharing Plan is administered by a
Compensation Committee appointed by our Board of Directors. For the year ended
November 30, 2001, no provision has been made for payment under the Profit
Sharing Plan.

BOARD PRACTICES

COMMITTEES OF THE BOARD OF DIRECTORS

    The standing committees of the Board of Directors consist of an Audit
Committee and a Compensation Committee.

AUDIT COMMITTEE

    The Audit Committee, formed in 1993, meets regularly to review our audit
practices and procedures, scope and adequacy of internal controls and related
matters, our financial statements and to advise the Board on such matters. The
Audit Committee recommends to the Board of Directors the annual appointment of
auditors, the scope of audit and other assignments to be performed by the
auditors and the fees relating thereto. The Audit Committee also meets
periodically with representatives of our auditors to review the scope of our
auditors' engagement with respect to the

                                       39
<Page>
audit of our financial statements and to review the recommendations of the
auditors arising therefrom. The current members of the Audit Committee are
Messrs. Woolveridge (Chairman), Poimboeuf, Skouveroe and Hurlock. In 2001, the
Audit Committee was comprised of Messrs. Woolveridge (Chairman), Poimboeuf and
Skouveroe.

COMPENSATION COMMITTEE

    The Compensation Committee, formed in 1993, reviews and approves salaries
for the executive officers, salary parameters for all other staff, profit
sharing awards (if any, pursuant to our Profit Sharing Plan) and stock option
awards under our Stock Option Plan. The current members of the Compensation
Committee are Messrs. Jacob Stolt-Nielsen (Chairman), Chris Wright and Niels G.
Stolt-Nielsen. In 2001, the Compensation Committee was comprised of
Messrs. Jacob Stolt-Nielsen (Chairman), Chris Wright (no longer a member of the
Board of Directors) and Mr. Laborie.

SERVICE CONTRACTS

    No director has a service contract that provides for benefits upon
termination.

EMPLOYEES

    Our workforce varies based on the workload at any particular time. The
following table presents the year end breakdown of both permanent employees by
geographic region for the last three financial years and temporary employees for
the last financial year. A significant number of our offshore employees are
represented by labor unions. As part of normal business, a number of union
agreements come up for annual renegotiations in 2002. We believe that we
maintain a good relationship with our employees and their unions. In addition,
many workers, including most of our divers, are hired on a contract basis and
are available on short notice.

<Table>
<Caption>
                                                         YEAR ENDED NOVEMBER 30,
                                              ---------------------------------------------
                                                2001        2001        2000        1999
                                              PERMANENT   TEMPORARY   PERMANENT   PERMANENT
                                              ---------   ---------   ---------   ---------
<S>                                           <C>         <C>         <C>         <C>
Asia Pacific................................      238         416         221         264
North America...............................      818         465         613         936
Norway......................................      718         140         679         584
SEAME.......................................      984         903         406         119
South America...............................      350          75         361         345
U.K.........................................      435         584         378         351
Corporate...................................      415          12          79          57
                                                -----       -----       -----       -----
Total.......................................    3,958       2,595       2,737       2,656
                                                =====       =====       =====       =====
</Table>

    The increase in permanent employees is largely a result of the acquisition
of Paragon in the Gulf of Mexico and Litwin in the SEAME Region, and the
employment, on a permanent basis, of temporary employees in welding services in
the SEAME region.

SHARE OWNERSHIP


    As of April 30, 2002, our Directors and executive officers as a group
directly owned 425,573 of the Common Share equivalents. This represented
approximately 0.6% of all outstanding Common Shares and 0.5% of total Common
Share equivalents. No individual Director or executive officer owned more than
1% of the outstanding Common Shares. SNSA is the 100% owner of SNTG. As of
May 31, 2002, a wholly owned subsidiary of SNSA owned 29,275,223 of our Common
Shares and all 34,000,000 of our Class B Shares. This ownership represents an
economic interest in us of approximately 57% and a voting interest of
approximately 65%. As of May 31, 2002, the Stolt-Nielsen family (including Jacob
Stolt-Nielsen and Niels G. Stolt-Nielsen), directly and indirectly through
Fiducia Ltd., controlled approximately 60% of the outstanding shares of SNSA
entitled to vote generally on matters brought to a vote of shareholders of SNSA.


    Our 1993 Stock Option Plan (the "Plan") covers 7.7 million shares
represented by Common Shares, Class A Shares or any combination thereof not
exceeding 7.7 million shares. Since March 7,

                                       40
<Page>
2001, all Class A Share options, when exercised, are automatically converted
into Common Shares. We account for awards granted to directors and key employees
under APB (Accounting Principles Board) Opinion 25, under which no compensation
costs are recognized. Options may be granted under the Plan exercisable for
periods of up to ten years. The options granted under the Plan will be at an
exercise price not less than the fair market value per share at the time the
option is granted. Options vest 25% on the first anniversary of the grant date,
with an additional 25% vesting on each subsequent anniversary. A Compensation
Committee appointed by our Board of Directors administers the Plan. The
Compensation Committee awards options based on the grantee's position in Stolt
Offshore, degree of responsibility, seniority, contribution to Stolt Offshore
and such other factors as it deems relevant under the circumstances.

    As of April 30, 2002, a total of 4,147,866 options exercisable for Common
Shares had been issued. As of April 30, 2002, 3,133,382 options exercisable for
Common Shares remain outstanding and 920,148 options over Common Shares are
currently exercisable. Of the total remaining outstanding, options for 387,600
Common Shares and options for 300,000 Class A Shares have been granted to
employees who are Directors and executive officers of Stolt Offshore. None of
our Directors or executive officers hold options exercisable for shares
representing more than 1% of outstanding Common Shares. The outstanding options
are exercisable at their respective prices set forth below and expire on the
dates indicated:

<Table>
<Caption>
                                                      WEIGHTED AVERAGE
                                      OPTIONS            REMAINING       WEIGHTED AVERAGE     NUMBER      WEIGHTED AVERAGE
RANGE OF EXERCISE PRICE             OUTSTANDING       CONTRACTUAL LIFE    EXERCISE PRICE    EXERCISABLE    EXERCISE PRICE
-----------------------         -------------------   ----------------   ----------------   -----------   ----------------
                                                          (YEARS)              ($)                              ($)
<S>                             <C>                   <C>                <C>                <C>           <C>
COMMON SHARES
$13.56 - 16.58................              786,300           8.37            14.27           137,625           16.58
$7.82 - 11.12.................               16,000           9.43             9.58                --              --
$5.17 - 7.38..................              897,680           8.93             6.26           121,830            5.74
$2.71 - 3.00..................              110,000           3.36             2.77           110,000            2.77
                                -------------------      ---------            -----           -------         -------
Total.........................            1,809,980           8.35             9.55           369,455            8.90
                                ===================      =========            =====           =======         =======
CLASS A SHARES
$11.50 - 16.58................              109,750           6.34            16.03            77,813           16.26
$7.82 - 11.13.................            1,101,112           7.74            10.21           360,340           10.18
$5.17 - 7.38..................               61,290           4.54             5.74            61,290            5.74
$2.71 - 3.00..................               51,250           3.39             2.77            51,250            2.77
                                -------------------      ---------            -----           -------         -------
Total.........................            1,323,402           7.31            10.20           550,693            9.85
                                ===================      =========            =====           =======         =======
Total.........................            3,133,382                                           920,148
                                ===================                                           =======
</Table>

    As part of the acquisition of Ceanic, holders of Ceanic shares were entitled
to exercise all vested and one-third of their unvested Ceanic options or to
convert any portion thereof to vested Stolt Offshore options. Their remaining
two-thirds unvested Ceanic options were automatically converted to unvested
Stolt Offshore options at the date of acquisition. As of April 30, 2002, a total
of 1,026,372 options exercisable for Common Shares had been granted to our
subsidiaries' employees. Options outstanding and options currently exercisable
as of April 30, 2002, include 640,400 Common Shares and

                                       41
<Page>
564,754 Common Shares, respectively. The outstanding options are exercisable at
their respective prices set forth below and expire on the dates indicated:

<Table>
<Caption>
                                                 WEIGHTED AVERAGE
                                     OPTIONS        REMAINING       WEIGHTED AVERAGE     NUMBER      WEIGHTED AVERAGE
RANGE OF EXERCISE PRICE            OUTSTANDING   CONTRACTUAL LIFE    EXERCISE PRICE    EXERCISABLE    EXERCISE PRICE
-----------------------            -----------   ----------------   ----------------   -----------   ----------------
                                                     (YEARS)              ($)                              ($)
<S>                                <C>           <C>                <C>                <C>           <C>
COMMON SHARES
$7.82 - 11.20....................    527,871           5.08              10.75           464,781          10.76
$5.21 - 7.38.....................    112,529           5.51               6.42            99,973           6.43
                                     -------           ----              -----           -------          -----
Total............................    640,400           5.44               9.99           564,754           9.99
                                     =======           ====              =====           =======          =====
</Table>

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS.

    Except as set forth below, we are not, directly or indirectly, owned by
another corporation or by any government. There are no arrangements known to us,
the operation of which may at a subsequent date result in a change in control of
Stolt Offshore.


    Set forth below is information concerning the share ownership of all persons
who owned beneficially 5% or more of the Common Share equivalents, as of
May 31, 2002. The Class A Shares for comparative periods of 2000 and 1999 have
been reclassified as Common Shares.



<Table>
<Caption>
                                                                                                   PERCENTAGE OF
                                     NUMBER OF     PERCENTAGE OF     NUMBER OF     PERCENTAGE OF   ECONOMICALLY
                                   COMMON SHARES      COMMON          CLASS B         CLASS B       EQUIVALENT
NAME OF BENEFICIAL OWNER               OWNED       SHARES OWNED    SHARES OWNED*   SHARES OWNED    SHARES OWNED
------------------------           -------------   -------------   -------------   -------------   -------------
<S>                                <C>             <C>             <C>             <C>             <C>
HOLDINGS AS AT MAY 31, 2002
SNTG.............................    29,275,223         57.3%       *17,000,000         100%            64.7%
Fidelity Management and Research
  Company........................   **2,157,000          3.9%                --          --              3.0%

HOLDINGS AS AT APRIL 30, 2001
SNTG.............................    29,275,233         41.7%       *17,000,000         100%            53.1%
Fidelity Management and Research
  Company........................   **5,684,346          8.1%                --          --              6.5%

HOLDINGS AS AT FEBRUARY 14, 2000
SNTG.............................     9,500,000         15.7%       *17,000,000         100%            34.2%
Fidelity Management and Research
  Company........................   **2,387,670          3.9%                --          --              3.1%
</Table>


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

*   SNTG owns 34,000,000 Class B Shares, constituting 100% of that class. Each
    Class B Share represents one-half of the economic interest of one Common
    Share (with dividend and liquidation rights equivalent to one-half of a
    Common Share) and is convertible into Common Shares on a two-for-one basis
    at any time at the option of the holder. If the Class B Shares cease to be
    owned by SNTG or an affiliate of SNTG, such Class B Shares automatically
    convert into Common Shares on a two-for-one basis. In addition, if SNTG or
    an affiliate of SNTG shall own shares (whether Class B Shares or Common
    Shares) representing less than a majority of the combined voting power of
    the then-outstanding shares of Stolt Offshore, then the Class B Shares shall
    automatically convert into Common Shares on a two-for-one basis. Common
    Shares and Class B Shares vote as a single class on all matters submitted to
    a vote of shareholders, by simple majority vote with each share entitled to
    one vote, except for matters where Luxembourg Law provides for a greater or
    separate class vote. Specifically, Luxembourg law provides that any
    amendment to the Articles of Incorporation in respect of recapitalization,
    reclassification and similar transactions affecting the relative rights,
    preferences and priorities of the Common Shares and Class B Shares if such
    class is

                                       42
<Page>
    adversely affected thereby, requires a quorum of 50% and a two-thirds
    affirmative vote of those shares of the affected class(es) present or
    represented at the meeting. With respect to liquidation and dividend rights,
    the Class B Shares receive $0.005 per share for each $0.01 per Common Share.

**  It should be noted that these shareholdings are compiled from data provided
    by third parties and accordingly we are not able to confirm the accuracy of
    these records at the given date. The numbers provided were compiled from
    returns filed as at March 22, 2002, adjusted for the repurchase of Common
    Shares held by Vinci by one of our indirect wholly owned subsidiaries on
    May 3rd 2002 and May 14th 2002.

    As of May 15, 2002, all of our 70,228,536 Common Shares were registered in
the Verdipapirsentralen in the names of 545 shareholders. Excluding outstanding
Common Shares registered in the name of the SNTG and outstanding Common Shares
registered in the name of Citibank N.A. as depositary for the ADSs and treasury
shares, held by a subsidiary of Stolt Offshore, it is estimated that the free
float of Common Shares on the Oslo Stock Exchange is 14,502,193.

    As of May 15, 2002, there was a total of 21,008,363 ADSs registered in the
names of 46 shareholders. Of the ADSs, 726,071 ADSs were registered in the names
of 32 shareholders having U.S. addresses (although some of such ADSs may be held
on behalf of non-U.S. persons). Based on communications with banks and
securities dealers who hold our ADSs in street name for individuals, we estimate
the number of beneficial owners of ADSs is approximately 1,600. Excluding ADSs
registered in the name of the Stolt-Nielsen Transportation Group Ltd. and
treasury shares, held by a subsidiary of Stolt Offshore, it is estimated that
the free float of ADSs on Nasdaq is 20,058,642.

RELATIONSHIP WITH SNSA

SHARE OWNERSHIP


    As of May 31, 2002, a wholly owned subsidiary of SNSA owned 29,275,223 of
our Common Shares and all 34,000,000 of our Class B Shares. This ownership
represents an economic interest in us of approximately 57% and a voting interest
of approximately 65%. As of May 31, 2002, the Stolt-Nielsen family, directly and
indirectly through Fiducia Ltd., controlled approximately 60% of the outstanding
shares of SNSA entitled to vote generally on matters brought to a vote of
shareholders of SNSA.


ARRANGEMENTS AND TRANSACTIONS WITH SNSA

    We and SNSA have developed a number of arrangements and engage in various
transactions as affiliated companies. We believe that these arrangements and
transactions, taken as a whole, are based on arm's length principles to
accommodate our respective interests in a manner that is fair and beneficial to
both parties. However, because of the scope of the various relationships between
us and SNSA (and our respective subsidiaries), we cannot assure you that each of
the agreements and transactions, if considered separately, has been or will be
effected on terms no less favorable to us than could have been obtained from
unaffiliated third parties.

    All material arrangements with SNSA are reviewed by the audit committee of
our Board of Directors consisting of directors who are not employees or officers
of either SNSA or Stolt Offshore and who are not related to the Stolt-Nielsen
family. Existing material arrangements include agreements with an affiliate of
SNSA under which the affiliate provides certain management, administrative,
accounting, financial and other services to us. From time to time, some of our
financing may be provided for or guaranteed by SNSA or its affiliates, and our
continued access to such financing would depend on a number of factors,
including compliance by SNSA or its affiliates with covenants in their financing
arrangements.

                                       43
<Page>
    Pursuant to a corporate services agreement, SNSA supplies through its
subsidiaries, financial, risk management, public relations and other services to
us for an annual fee based on costs incurred in rendering those services. The
fee is subject to negotiation and agreement between us and SNSA on an annual
basis. The fees for 2001, 2000 and 1999 were approximately $3.7 million,
$3.3 million and $2.5 million, respectively. The services agreement is
automatically renewed for additional one-year terms unless we and SNSA are
unable to agree on the annual fees payable. The services agreement may also be
terminated by either party on the occurrence of certain events, including the
other party's:

    - failure to pay amounts due under the services agreement within 15 days
      after notice;

    - breach of any material obligation under the services agreement and failure
      to cure any breach within 30 days after notice; and

    - bankruptcy or related proceedings.

INTERCOMPANY PAYMENTS

    Our payments to SNSA for the years 2001, 2000 and 1999 consisted of the
following in millions:

<Table>
<Caption>
                                                                 YEAR ENDED NOVEMBER 30,
                                                           ------------------------------------
                                                             2001          2000          1999
                                                           --------      --------      --------
<S>                                                        <C>           <C>           <C>
Interest payments....................................        $0.4          $3.6         $10.4
Management services..................................        $3.7          $3.3         $ 2.5
</Table>

    Short-term payables due to SNSA of $9.5 million as of November 30, 2001
(2000: $8.5 million) relate primarily to outstanding insurance premiums and
management service charges.

    SNSA has provided us with a $65.0 million unsecured bridge loan to enable us
to partially fund the purchase of 6,142,847 shares from Vinci. The loan is
subordinated to our principal credit facility and bears interest at a rate of
4.75% per annum as well as an upfront fee of $65,000. Under the terms of the
loan, repayment is to be made on the earlier of either the date of the receipt
of the proceeds from the sale of our Common Shares, or August 2, 2002.

SERVICE MARK AGREEMENT

    We and SNSA are parties to an agreement under which we have been granted the
right to use the Stolt name and logo, without payment of any royalty, so long as
SNSA or its affiliates own more than one-third of our voting shares.

OTHER RELATED PARTY TRANSACTIONS

    Although this is no longer the practice, historically we have provided loans
to our senior management for relocation expenses. As of May 15, 2002, there was
a loan outstanding to a member of our senior management team for $229,000.
Interest on this loan is 6.25%. The highest aggregate amount of loans
outstanding to senior management at any time in the last three years was
$363,000.

    In 2001, we made a payment of $50,000 for marketing services to a company in
which one of our non-executive directors has a direct interest.

ITEM 8. FINANCIAL INFORMATION.

LEGAL PROCEEDINGS

    We are involved in legal proceedings from time to time incidental to the
ordinary conduct of our business.


    Coflexip S.A. has commenced legal proceedings through the United Kingdom
High Court against three of our subsidiaries claiming infringement of a certain
patent held by Coflexip relating to flexible flowline laying technology in the
United Kingdom. Judgment was rendered on January 22, 1999 and January 29, 1999.
The disputed patent was held valid. We appealed, and the Appeal Court maintained


                                       44
<Page>

the validity of the patent and broadened its application compared to the High
Court decision. We applied for leave to appeal the Appeal Court decision to the
House of Lords, which has now been denied. The result of these court decisions
is that the flexible lay system tower on SEAWAY FALCON, and the process by which
the system lays flexible conduits, has been held to infringe Coflexip's patent
in the United Kingdom. During 2001, Coflexip submitted an amended claim to
damages claiming lost profits on a total of 15 projects. In addition, there is a
claim for alleged price depreciation on certain other projects. The claim is for
approximately $89.0 million, up from approximately $14.0 million claimed
previously, plus interest, legal costs and a royalty for each time that the
flexible lay system tower on the SEAWAY FALCON was brought into United Kingdom
waters. We estimate that the total claim will amount to approximately
$115.0 million. In the alternative, Coflexip claims a reasonable royalty for
each act of infringement, interest and legal costs. Coflexip has not quantified
this claim, but we expect that it will be considerably less than the claim to
lost profits. We, in consultation with our advisers, have assessed that the
range of possible outcomes for the resolution of damages is $1.5 million to
$115.0 million and have determined that there is no amount within the range that
is a better estimate than any other amount. Consequently, in accordance with
SFAS No. 5, we have reserved $1.5 million in the financial statements, being the
lower end of the range. The amount of damages is nevertheless uncertain and no
assurance can be given that the reserved amount is sufficient.



    In September 1999, we terminated our charter of the ship TOISA PUMA for
default. We are currently in arbitration with the owners, who are contesting
that the termination was wrongful. The arbitration has held that the ship was in
breakdown, but the termination was nevertheless wrongful. We applied for leave
to appeal the decision to the High Court, which has been denied. During 2001,
the owner has quantified his claim to approximately $8.0 million. We have
disputed the magnitude of this claim in relation to lack of instigation, lack of
cost savings and lack of actual loss for parts of the claim. In addition, we
have a counterclaim related to the breakdown of the ship. In consultation with
our advisers, we have assessed the range of possible outcomes for the resolution
of damages with the upper amount being $8.0 million. We have determined that
there is no amount within the range that is a better estimate than any other
amount. Consequently, in accordance with SFAS No. 5, we have reserved
$2.0 million in the financial statements, an amount to cover the liability for
damages which is at the lower end of the range. The amount of such liability is
nevertheless uncertain and no assurance can be given that the provided amount is
sufficient.


    Legal costs are expensed as incurred.

    Litigation is subject to many uncertainties, and the outcome of individual
matters is not predictable with assurance. It is reasonably possible that the
final resolution of any litigation could require us to make additional
expenditures in excess of reserves that we may establish. In the ordinary course
of business, various claims, suits and complaints have been filed against us in
addition to those specifically referred to above. Although the final resolution
of any such other matters could have a material effect on our operating results
for a particular reporting period, we believe that they should not materially
affect our consolidated financial position.

DIVIDEND POLICY

    We have never paid dividends on our share capital, and currently intend to
retain any earnings for the future operation and growth of the business. The
Board of Directors will review this policy from time to time in light of our
earnings financial condition, prospects, tax considerations and foreign exchange
rates. We will pay dividends, if any, in U.S. dollars.

SIGNIFICANT CHANGES

    Except as otherwise disclosed in this Report, there has been no material
change in our financial position since November 30, 2001.

                                       45
<Page>
ITEM 9. THE OFFER AND LISTING

TRADING MARKETS

    Our Common Shares trade as ADSs in the United States on the Nasdaq National
Market under the symbol "SOSA" and are listed in Norway on the Oslo Stock
Exchange under the symbol "STO."

    The following table sets forth the high and low last reported sale prices
for our ADSs reported on the Nasdaq National Market and the closing prices for
our Common Shares reported on the Oslo Stock Exchange during the indicated
periods.


<Table>
<Caption>
                                                                                      COMMON SHARES
                                                                                        OSLO STOCK
                                                                 ADSS*                   EXCHANGE
                                                                 NASDAQ                 (NORWEGIAN
                                                             (U.S. DOLLARS)              KRONER)
                                                         ----------------------   ----------------------
                                                           HIGH          LOW        HIGH          LOW
                                                         --------      --------   --------      --------
<S>                                                      <C>           <C>        <C>           <C>
ANNUAL HIGHS AND LOWS
1997...............................................        22.14          4.95     181.76         57.36
1998...............................................        24.42          7.88     178.09         61.00
1999...............................................        14.94          6.13     117.00         48.00
2000...............................................        16.38          9.13     150.00         85.50
2001...............................................        15.88          6.15     141.00         57.00
QUARTERLY HIGHS AND LOWS
Fiscal 2000
      Second Quarter...............................        16.38         11.88     146.00        105.00
      Third Quarter................................        15.56         13.07     139.00        112.00
      Fourth Quarter...............................        16.00          9.13     150.00         95.00
Fiscal 2001
      First Quarter................................        15.25          9.50     138.00         88.00
      Second Quarter...............................        15.88         12.69     141.00        117.00
      Third Quarter................................        14.65          8.46     137.00         80.00
      Fourth Quarter...............................         9.40          6.15      85.00         57.00
Fiscal 2002
      First Quarter................................        80.00         54.50       9.29          6.25
MONTHLY HIGHS AND LOWS
Fiscal 2001
      December.....................................         9.00          6.25      79.00         54.50
Fiscal 2002
      January......................................         9.29          6.83      80.00         58.00
      February.....................................         7.12          6.55      64.00         58.00
      March........................................         8.48          6.80      72.00         60.00
      April........................................         9.17          8.40      80.00         73.00
      May..........................................         8.70          7.94      73.00         62.50
      June (to June 27, 2002)......................         7.90          6.01      64.00         43.00
</Table>


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

*   Prior to March 7, 2001, Common Shares did not trade in the form of ADSs on
    the Nasdaq National Market, but traded as Common Shares. All share prices
    have been adjusted to reflect the two-for-one stock split completed on
    January 9, 1998, the Class A Share distribution on June 25, 1998 and the
    reclassification of Class A Shares to Common Shares on a one-for-one basis
    on March 7, 2001.

    The bid prices reported for these periods reflect inter-dealer prices,
rounded to the nearest cent, and do not include retail markups, markdowns or
commissions, and may not represent actual transactions.


    On June 27, 2002, the last reported sale price of our ADSs on the Nasdaq
National Market was $6.01 per ADS, and the closing price of our Common Shares on
the Oslo Stock Exchange was NOK 44.00 per share.


                                       46
<Page>

    As of May 31, 2002, we had 63,850,450 shares outstanding, excluding an
aggregate of 3,759,411 Common Shares reserved for issuance upon exercise of
options outstanding as of May 31, 2002 and 3,906,218 additional Common Shares
available for further grants under stock plans. As a result of the exchange of
Common Shares for debt owed to SNSA, as of June 30, 2002, we had 66,850,450
Common Shares outstanding. See "Item 5. Operating and Financial Review and
Prospects--Liquidity and Capital Resources."


ITEM 10. ADDITIONAL INFORMATION.

ARTICLES OF INCORPORATION

    Stolt Offshore S.A. is a "Societe Anonyme Holding," organized in the Grand
Duchy of Luxembourg under the Company Law of 1915, as amended. We were
incorporated in Luxembourg in 1993 as the holding company for all of the Group's
activities.

    Our registered office is located at 26, rue Louvigny, L-1946 Luxembourg and
we are registered in the Companies' Register of the Luxembourg District Court
under the designation "R.C. Luxembourg B 43172."

    Article 3 of our Articles of Incorporation sets forth our objects as a
holding company, namely to invest in subsidiaries which will provide subsea
construction, maintenance, inspection, survey and engineering services,
predominantly for the offshore oil and gas industry. More generally, we may
participate in any manner in all commercial, industrial, financial and other
enterprises of Luxembourg or foreign nationality through the acquisition by
participation, subscription, purchase, option or by other means of all shares,
stocks, debentures, bonds or securities; the acquisition of patents and licenses
which it will administer and exploit; we may lend or borrow with or without
security, provided that any money so borrowed may only be used for the purposes
of Stolt Offshore or companies that are subsidiaries of or associated with or
affiliated to Stolt Offshore; and in general to undertake any operations
directly or indirectly connected with such objects as permitted by the
Luxembourg Holding Company Law of 1929.

    Set forth below is a description of the material provisions of our Articles
of Incorporation and the Luxembourg Company Law. The following summary is
qualified by reference to the Articles of Incorporation and applicable
Luxembourg law. The full text of the Articles of Incorporation is available at
our registered office.

DIRECTORS

    Our Board of Directors is comprised of not less than three members, elected
by a simple majority of our outstanding shares represented at a general meeting
of shareholders for a period not exceeding six years and until their successors
are elected. It is our customary practice that Directors are elected for terms
of one year at the Annual General Meeting of Shareholders held each year in
Luxembourg.

    Our Articles of Incorporation do not mandate the retirement of Directors
under an age limit requirement. Our Articles of Incorporation do not require
Board members to be shareholders in Stolt Offshore.

    Under Luxembourg law and our Articles of Incorporation, the members of the
Board of Directors owe a duty of loyalty and care to Stolt Offshore. They must
exercise the standard of care of a prudent and diligent business person.

    Our Articles of Incorporation provide that no transaction between Stolt
Offshore and another party in which a Director serves as a director, officer or
employee, will be invalidated solely for that reason. The Articles also provide
that any Director who has a personal interest in a transaction must disclose
such interest, must abstain from voting on such transaction and may not be
counted for purposes of determining whether a quorum is present at the meeting.
Such Director's interest in any such transaction shall be reported at the next
meeting of shareholders. A Director who owns less than

                                       47
<Page>
5% of our capital stock or of the other party whose transaction with us is being
submitted to our Board of Directors for its approval is not subject to the
provisions of this paragraph.

AUTHORIZED SHARES

    Our authorized share capital consists of:

    - 140,000,000 Common Shares, par value U.S. $2.00 per share; and

    - 34,000,000 Class B Shares, par value U.S. $2.00 per share.

    Pursuant to our Articles of Incorporation, and as required by Luxembourg law
as presently in effect, authorized capital will automatically be reduced to the
amount represented by outstanding shares on the fifth anniversary date of the
publication of the most recent amendment of the Articles revising our authorized
capital. Amendments amending our authorized capital were approved at an
Extraordinary General Meeting held on March 6, 2001, and publication of such
amendment in the OFFICIAL GAZETTE took place in October 2001. From time to time
we take such steps that are required to continue the authorized capital in
effect.

    The Board of Directors is authorized to issue additional Common Shares and
Class B Shares, from time to time, up to the maximum authorized number. The
Articles of Incorporation require all shares to be issued in registered form.
All shares, when issued, are fully paid and non-assessable. All shares are
freely transferable by the holder thereof.

    As a general rule, shareholders are entitled to preemptive rights under
Luxembourg law in respect of the issuance of shares for cash, unless the
Articles of Incorporation provide otherwise. Our Articles authorize the Board of
Directors to deny shareholders' preemptive rights for a period of five years and
our Board of Directors has done so with respect to all authorized but unissued
Common Shares. Upon the expiration of authorized but unissued shares as
described above, the suppression of preemptive rights will also terminate and
shareholders will be entitled to preemptive rights once again unless the Board
recommends denying further such rights and such recommendation is approved by
the shareholders. As a result, Common Shares will not be entitled to preemptive
rights for a period of at least five years ending October 2006.

    In addition to the authorized Common Shares and Class B Shares set forth
above, an additional 1,500,000 Class A Shares, par value U.S. $2.00 per share,
have been authorized for the sole purpose of options granted under our existing
stock option plans, and may not be used for any other purpose. The rights,
preferences and priorities of such Class A Shares are set forth in the Articles
of Incorporation. All such Class A Shares convert to Common Shares immediately
upon issuance. Such authorized Class A Shares and all of the rights relating
thereto shall expire, without further action, on December 31, 2009.

VOTING RIGHTS

    Except for matters where applicable law requires the approval of both
classes of shares voting as separate classes, Common Shares and Class B Shares
vote as a single class on all matters submitted to a vote of the shareholders,
with each share entitled to one vote. Under Luxembourg law, shareholder action
can generally be taken by a simple majority of Common Shares and Class B Shares
present or represented at a meeting, without regard to any minimum quorum
requirements. Three exceptions to the law are (i) to amend the Articles which
requires (x) a two-thirds vote of those Common Shares and Class B Shares present
or represented, and (y) when the meeting is first convened, a quorum of 50% of
the outstanding shares entitled to vote; (ii) to change the country of
incorporation of Stolt Offshore to a country other than Luxembourg or to
increase the contribution of the shareholders, which require the affirmative
vote of 100% of the Common Shares and Class B Shares; and (iii) any action for
which the Articles require more than a majority vote or a quorum. Luxembourg law
further provides that a two-thirds majority vote of those shares present or
represented and when the meeting is first convened, a quorum of 50% of such
shares, of the outstanding Common Shares and Class B Shares, each voting

                                       48
<Page>
and counted for quorum purposes as a separate class, is required to authorize
any amendment to the Articles in respect of a recapitalization, reclassification
and similar transactions affecting the relative rights, preferences and
priorities of the Common Shares and Class B Shares if such class of shares is
adversely affected thereby.

SHAREHOLDER MEETINGS AND NOTICE THEREOF

    Under the Articles, we are required to hold a general meeting of
shareholders each year in Luxembourg. The meeting is normally convened in April.
In addition, the Board may call any number of extraordinary general meetings,
which may be held in Luxembourg or elsewhere, although any extraordinary general
meeting convened to amend the Articles will be held in Luxembourg. The Board of
Directors is further obliged to call a general meeting of shareholders to be
held within thirty days after receipt of a written demand therefor by
shareholders representing at least one-fifth of the outstanding shares entitled
to vote thereat.

    The Articles require notice of any general meeting to be sent by first class
mail, postage prepaid, to all shareholders at least twenty days prior to such
meeting. Shareholders may be represented by written proxy, provided the written
proxy is deposited with us at our registered office in Luxembourg, or with any
Director, at least five days before the meeting.

DIVIDENDS

    Under the Articles, holders of Common Shares and Class B Shares participate
in all dividends, if any are declared, provided that, in the case of cash or
property dividends, each Class B Share shall receive $0.005 per share for each
$0.01 per share in cash or value paid on each Common Share. No dividend, in cash
or property, may be paid separately on either class of shares. If share
dividends are declared, holders of Common Shares will receive Common Shares and
holders of Class B Shares will receive Class B Shares.

    Interim dividends can be declared up to three times in any fiscal year by
the Board of Directors. Interim dividends can be paid, but only after the prior
year's financial statements have been approved by the shareholders at a general
meeting and any such interim dividend must be approved by our independent
auditors. Final dividends are declared once a year at the annual general meeting
of the shareholders. Interim and final dividends on Common Shares and Class B
Shares can be paid out of earnings, retained and current, as well as paid in
surplus.

    Luxembourg law authorizes the payment of stock dividends if sufficient
surplus exists to provide for the related increase in stated capital or the par
value of the shares issued in connection with any stock dividend.

    Luxembourg law requires that 5% of our unconsolidated net profit each year
be allocated to a legal reserve before declaration of dividends. This
requirement continues until the reserve is 10% of our stated capital, as
represented by the Common Shares and Class B Shares, after which no further
allocations are required until further issuance of shares.

    The legal reserve may also be satisfied by allocation of the required amount
at the time of issuance of shares or by a transfer from paid-in surplus. The
legal reserve is not available for dividends. The legal reserve for all existing
Common Shares and Class B Shares has heretofore been satisfied and appropriate
allocations will be made to the legal reserve account at the time of each new
issuance of Common Shares and Class B Shares.

                                       49
<Page>
LIQUIDATION PREFERENCE

    Under the Articles, in the event of a liquidation, all of our debts and
obligations must first be paid, and thereafter all of our remaining assets are
paid to the holders of Common Shares and Class B Shares, provided that each
Class B Share shall receive $0.005 per share for each $0.01 per share in cash or
value paid to each Common Share.

CONVERSION RIGHTS

    Class B Shares are convertible into Common Shares on a two-for-one basis, at
any time at the option of the holders thereof. In addition, if SNTG or its
affiliates dispose of Class B Shares to a third party, each Class B Share
disposed of shall automatically convert into one-half of one Common Share.
Furthermore, in the event that SNTG (or any entity controlling, controlled by or
under common control with it) shall own shares (whether Class B Shares or Common
Shares) representing less than a majority of the combined voting power of our
then outstanding shares, then, without any action on the part of the holders
thereof, each such Class B Share shall automatically convert into one-half of
one Common Share.

RESTRICTIONS ON SHAREHOLDERS

    Our Articles of Incorporation provide that in recognition of the fact that
certain shareholdings may threaten us with "imminent and grave damage," which
term includes adverse tax consequences, a hostile takeover attempt or adverse
governmental sanctions,

    (i) no U.S. Person (as defined in the Articles) shall own, directly or
        indirectly, more than 9.9% of our outstanding shares,

    (ii) all shareholders of any single country may not own, directly or
         indirectly, more than 49.9% of our outstanding shares, and

   (iii) no person may own, directly or indirectly, more than 20% of our
         outstanding shares unless a majority of the Board shall have authorized
         such shareholding in advance.

    The Articles provide that the foregoing restrictions shall not apply to any
person who was a shareholder as of March 10, 1993, or certain Affiliates or
Associates (as such terms are defined in the Articles) of such person.

    In addition, the Board is authorized to restrict, reduce or prevent the
ownership of our shares if it appears to the Board that such ownership may
threaten us with "imminent and grave damage." Luxembourg company law does not
provide a specific definition of imminent and grave damage, but instead leaves
the interpretation of the phrase within the Board's discretion. We have been
advised by Elvinger, Hoss & Prussen, that there are no Luxembourg judicial
interpretations of the phrase, but that situations involving hostile takeovers,
adverse tax consequences or governmental sanctions are likely to be among the
situations covered by such phrase.

    In order to enforce the foregoing restrictions, the Articles empower the
Board to take certain remedial action including causing us: (i) to decline to
register any prohibited transfer; (ii) to decline to recognize any vote of a
shareholder precluded from holding shares; (iii) to require any shareholder on
our Register of Shareholders or any prospective shareholder to provide
information to determine whether such person is precluded from holding shares
and (iv) upon the issuance of a notice, to require the sale of shares to us at
the lesser of (A) the amount paid for the shares if acquired within the twelve
months immediately preceding the date of the notice, and (B) the last quoted
sale price for the shares on the day immediately preceding the day on which the
notice is served (provided that the Board may in its discretion pay the amount
calculated under (B) in situations where (A) would otherwise apply and result in
a lower purchase price, if the Board determines it equitable after taking into
account

                                       50
<Page>
specified factors); and to remove the name of any shareholder from the Register
of Shareholders immediately after the close of business on the day the notice is
issued and payment is made available. The foregoing defensive measures may have
the effect of making more difficult a merger involving us, or a tender offer,
open-market purchase program or other purchase of our shares, in circumstances
that could give shareholders the opportunity to realize a premium over the then
prevailing market price for their shares.

    There are no limitations currently imposed by Luxembourg law on the rights
of non-resident Stolt Offshore shareholders to hold or vote their shares.

CHANGE IN CONTROL

    Except as described above, there are no provisions in our Articles of
Incorporation that would have the effect of delaying, deferring or preventing a
change in control of Stolt Offshore and that would only operate with respect to
a merger, acquisition or corporate restructure involving us or any of our
subsidiaries.

MATERIAL CONTRACTS

    On September 22, 2000, we entered into a $440 million Secured Multi-Currency
Revolving Loan Facility Agreement with a syndicate of banks, the lead banks
being Den norske Bank ASA, Banc of America Securities LLC, Salomon Brothers
International Limited, HSBC Bank plc and ING Baring LLC. The credit facility is
a five year revolving credit facility which reduces to $385 million on
August 31, 2002 and $330 million on August 31, 2003. The interest rate on
outstanding debt is based on the ratio of our debt to earnings before interest,
taxes, depreciation and amortization. The interest charge will range from 0.75%
to 1.75% over LIBOR. Debt under the credit facility is secured by a first
mortgage on certain of our ships and barges.

EXCHANGE CONTROLS

    We have been advised by Elvinger, Hoss & Prussen, our Luxembourg counsel,
that at the present time there are no exchange controls in existence in
Luxembourg that would impact our operations or affect our ability to pay
dividends to non-resident shareholders.

TAXATION

LUXEMBOURG TAXATION

    The following is intended only as a general summary of certain tax
considerations affecting dividend payments by Stolt Offshore relevant to
prospective investors in Stolt Offshore. It does not constitute and should not
be construed to constitute legal or tax advice to any such investor. Prospective
investors are therefore urged to consult their own tax advisers with respect to
their particular circumstances. Double taxation treaties may contain rules
affecting the description in this summary.

STOLT OFFSHORE

    Stolt Offshore is a holding company under the law of July 31, 1929 of
Luxembourg and is eligible for the following taxation provided for by the decree
of December 17, 1938. An annual tax on all amounts paid by Stolt Offshore on
interest payments made on bonds or debentures issued by Stolt Offshore would be
levied at the rate of 3% on such interest payments. Stolt Offshore has not and
does not contemplate to issue bonds or debentures so that this tax on interest
is unlikely to become relevant.

                                       51
<Page>
Additionally an annual tax on all amounts paid by Stolt Offshore as dividends
and non-resident Directors' fees will be computed on the following basis:

    (i) 3% of the first 2,400,000 E or the equivalent thereof;

    (ii) 1.8% of the next 1,200,000 E; and

   (iii) 0.1% of any balance;

with a minimum annual tax of 48,000 E. These taxes are paid by Stolt Offshore.
Since Stolt Offshore has not since its incorporation paid any dividends it has
only been subject to the minimum annual tax.

    Subject to the foregoing, Stolt Offshore, as a Luxembourg holding company,
is not liable under present Luxembourg law for any income tax, withholding tax,
capital gains tax, estate or inheritance tax, or any other tax (except for a
contribution tax of 1% on issues of share capital), calculated by references to
its capital assets, or income.

SHAREHOLDERS

    Under present Luxembourg law, so long as Stolt Offshore maintains its status
as a holding company, no income tax, withholding tax, capital gains tax, estate
or inheritance tax is payable in Luxembourg by shareholders in respect of the
Common Shares, expect for shareholders domiciled, resident (or, in certain
circumstances, formerly resident) or having a permanent establishment in
Luxembourg.

    Shareholders domiciled or resident in Luxembourg (expect holding companies)
or who have a permanent establishment in Luxembourg with whom the holding of the
Common Shares is effectively connected, have to include the dividend received in
their taxable income during the relevant period.

    Physical persons domiciled or resident in Luxembourg are not subject to
taxation of capital gains unless the disposal of the Common Shares preceded the
acquisition or the disposal occurs within 6 months following the acquisition of
the Common Shares. Physical persons domiciled or resident in Luxembourg who own
more than 10% (the limit being 25% for those participations which had been
acquired prior to fiscal year 2002 and disposed of at the latest during fiscal
year 2007) of the issued Common Shares are liable to taxation on capital gains
even after the 6 months holding and physical persons who were formerly residents
or domiciled in Luxembourg will remain so liable during a period of 5 years
after they have given up their domicile or residence in Luxembourg or their
holding has been reduced below 10% (the limit being 25% for those participations
which had been acquired prior to fiscal year 2002 and disposed of at the latest
during fiscal year 2007) provided they had their domicile or residence in
Luxembourg for more than 15 years.

    Income and capital gains on Common Shares which are included in the assets
of a trade or business of a physical person domiciled or resident in Luxembourg
or in the permanent establishment in Luxembourg of a non-resident and income and
capital gains on Common Shares which are held by corporations (other than
holding companies) will be included in the taxable income of the relevant
taxpayers.

    There is no Luxembourg transfer duty or stamp tax applicable on sales
acquisitions of the Common Shares.

U.S. FEDERAL INCOME TAXATION

    The following is a description of the material U.S. federal income tax
consequences that may be relevant with respect to the acquisition, ownership and
disposition of Common Shares or ADSs. This

                                       52
<Page>
description addresses only the U.S. federal income tax considerations of holders
that will hold Common Shares or ADSs as capital assets. This description does
not address tax considerations applicable to:

    - holders of Common Shares or ADSs that may be subject to special tax rules,
      such as financial institutions, insurance companies, real estate
      investment trusts, regulated investment companies, grantor trusts, dealers
      or traders in securities or currencies, tax-exempt entities,

    - taxpayers that have elected to use mark-to-market accounting,

    - persons that received Common Shares or ADSs as compensation for the
      performance of services,

    - persons that will hold Common Shares or ADSs as part of a "hedging" or
      "conversion" transaction or as a position in a "straddle" for U.S. federal
      income tax purposes,

    - persons that have a "functional currency" other than the U.S. dollar, or

    - holders that own, or are deemed to own, 10% or more, by voting power or
      value, of the stock of Stolt Offshore.

    Moreover, this description does not address the U.S. federal estate and gift
or alternative minimum tax consequences of the acquisition, ownership and
disposition of Common Shares or ADSs. This description is based on:

    - the Internal Revenue Code of 1986, as amended, or the Code,

    - U.S. Treasury Regulations issued under the Code, and

    - judicial and administrative interpretations of the Code and regulations,

each as in effect and available on the date of this Report. This description is
also based in part on the representations of the depositary and the assumption
that each obligation in the deposit agreement and any related agreement will be
performed in accordance with its terms. All of the foregoing are subject to
change, which change could apply retroactively and could affect the tax
consequences described below.

    The U.S. Treasury Department has expressed concern that depositaries for
American depositary receipts, or other intermediaries between the holders of
shares of an issuer and the issuer, may be taking actions that are inconsistent
with the claiming of U.S. foreign tax credits by U.S. holders of such receipts
or shares. Accordingly, the analysis regarding the availability of a U.S.
foreign tax credit for Luxembourg taxes and sourcing rules described below could
be affected by future actions that may be taken by the U.S. Treasury Department.

    For purposes of this description, a U.S. Holder is a beneficial owner of
Common Shares or ADSs that, for U.S. federal income tax purposes, is:

    - citizen or resident of the United States,

    - a partnership or corporation created or organized in or under the laws of
      the United States or any state thereof, including the District of
      Columbia,

    - an estate the income of which is subject to U.S. federal income taxation
      regardless of its source, or

    - a trust if such trust validly elects to be treated as a U.S. person for
      U.S. federal income tax purposes or if (1) a court within the United
      States is able to exercise primary supervision over its administration and
      (2) one or more U.S. persons have the authority to control all of the
      substantial decisions of such trust.

                                       53
<Page>
    A Non-U.S. Holder is a beneficial owner, or, in the case of a partnership, a
holder of Common Shares or ADSs that is not a U.S. Holder.

    We urge you to consult your own tax advisor with respect to the U.S.
federal, state, local and foreign tax consequences of acquiring, owning or
disposing of Common Shares or ADSs.

OWNERSHIP OF ADSS IN GENERAL

    For U.S. federal income tax purposes, a holder of ADSs generally will be
treated as the owner of the Common Shares represented by such ADSs.

DISTRIBUTIONS

    If you are a U.S. Holder, the gross amount of any distribution by Stolt
Offshore of cash or property, other than certain distributions, if any, of
Common Shares distributed pro rata to all shareholders of Stolt Offshore,
including holders of ADSs, with respect to Common Shares or ADSs will be
includible in your income as dividend income to the extent such distributions
are paid out of the current or accumulated earnings and profits of Stolt
Offshore as determined under U.S. federal income tax principles. Such dividends
will not be eligible for the dividends received deduction generally allowed to
corporate U.S. Holders. To the extent, if any, that the amount of any
distribution by Stolt Offshore exceeds Stolt Offshore's current and accumulated
earnings and profits as determined under U.S. federal income tax principles, it
will be treated first as a tax-free return of your adjusted tax basis in the
Common Shares or ADSs and thereafter as capital gain.

    Dividends received by you with respect to Common Shares or ADSs will be
treated as foreign source income, which, if you are a U.S. Holder, may be
relevant in calculating your foreign tax credit limitation. The limitation on
foreign taxes eligible for credit is calculated separately with respect to
specific classes of income. For this purpose, dividends distributed by Stolt
Offshore generally will constitute "passive income", or, in the case of certain
U.S. Holders, "financial services income".

    Subject to the discussion below under "Backup Withholding Tax and
Information Reporting Requirements", if you are a Non-U.S. Holder of Common
Shares or ADSs, generally you will not be subject to U.S. federal income or
withholding tax on dividends received on Common Shares or ADSs, unless such
income is effectively connected with your conduct of a trade or business in the
U.S.

SALE OR EXCHANGE OF COMMON SHARES OR ADSS

    If you are a U.S. Holder, you will generally recognize gain or loss on the
sale or exchange of Common Shares or ADSs equal to the difference between the
amount realized on such sale or exchange and your adjusted tax basis in the
Common Shares or ADSs. Such gain or loss will be capital gain or loss. If you
are a noncorporate U.S. Holder, the maximum marginal U.S. federal income tax
rate applicable to such gain will be lower than the maximum marginal U.S.
federal income tax rate applicable to ordinary income if your holding period for
such Common Shares or ADSs exceeds one year and will be further reduced if your
holding period exceeds five years. If you are a U.S. Holder, gain or loss, if
any, recognized by you generally will be treated as U.S. source income or loss
for U.S. foreign tax credit purposes. The deductibility of capital losses is
subject to limitations.

    If you are a U.S. Holder, your initial tax basis of Common Shares will be
the U.S. dollar value of the Norwegian kroner denominated purchase price
determined on the date of purchase. If the Common Shares are treated as traded
on an "established securities market," and you are a cash basis U.S. Holder (or,
if you elect, an accrual basis U.S. Holder), you will determine the dollar value
of the cost of such Common Shares by translating the amount paid at the spot
rate of exchange on the settlement date of the purchase. The conversion of U.S.
dollars to Norwegian kroners and the immediate use of that currency to purchase
Common Shares generally will not result in taxable gain or

                                       54
<Page>
loss for a U.S. Holder. If you are a U.S. Holder, the initial tax basis of the
ADSs will be the U.S. dollar denominated purchase price determined on the date
of purchase.

    With respect to the sale or exchange of Common Shares, the amount realized
generally will be the U.S. dollar value of the payment received determined on
(1) the date of receipt of payment in the case of a cash basis U.S. Holder and
(2) the date of disposition in the case of an accrual basis U.S. Holder. If the
Common Shares are treated as traded on an "established securities market," a
cash basis taxpayer, or, if it elects, an accrual basis taxpayer, will determine
the U.S. dollar value of the amount realized by translating the amount received
at the spot rate of exchange on the settlement date of the sale.

    If you are a Non-U.S. Holder of Common Shares or ADSs, subject to the
discussion below under "Backup Withholding Tax and Information Reporting
Requirements", you will generally not be subject to U.S. federal income or
withholding tax on any gain realized on the sale or exchange of such Common
Shares or ADSs unless (1) such gain is effectively connected with your conduct
of a trade or business in the U.S. or (2) if you are an individual Non-U.S.
Holder, you are present in the U.S. for 183 days or more in the taxable year of
the sale or exchange and certain other conditions are met.

BACKUP WITHHOLDING TAX AND INFORMATION REPORTING REQUIREMENTS

    U.S. backup withholding tax and information reporting requirements generally
apply to certain payments to certain noncorporate holders of stock. Information
reporting generally will apply to payments of dividends on, and to proceeds from
the sale or redemption of, Common Shares or ADSs made within the U.S. to a
holder of Common Shares or ADSs, other than an "exempt recipient", including a
corporation, a payee that is not a U.S. person that provides an appropriate
certification and certain other persons. A payor will be required to withhold
backup withholding tax from any payments of dividends on, or the proceeds from
the sale or redemption of, Common Shares or ADSs within the U.S. to a holder,
other than an "exempt recipient", if you fail to furnish your correct taxpayer
identification number or otherwise fail to comply with, or establish an
exemption from, such backup withholding tax requirements. The backup withholding
tax rate is 30% for years 2002 and 2003, 29% for years 2004 and 2005, and 28%
for years 2006 through 2010.

    The above description is not intended to constitute a complete analysis of
all tax consequences relating to acquisition, ownership and disposition of
Common Shares or ADSs. We urge you to consult your own tax advisor concerning
the tax consequences of your particular situation.

DOCUMENTS ON DISPLAY

    We are subject to the informational requirements of the Securities Exchange
Act of 1934 applicable to foreign private issuers and, in accordance with these
requirements, we file reports with the Securities and Exchange Commission. As a
foreign private issuer, we are exempt from the rules under the Exchange Act
relating to the furnishing and content of proxy statements, and our officers,
directors and principal shareholders are exempt from the reporting and
short-swing profit recovery provisions contained in Section 16 of the Exchange
Act. In addition, we are not required under the Exchange Act to file periodic
reports and financial statements with the Securities and Exchange Commission as
frequently or as promptly as U.S. companies whose securities are registered
under the Exchange Act.

    You may read and copy any documents that we file with the Securities and
Exchange Commission, including this Report and the related exhibits, without
charge at the Securities and Exchange Commission's public reference room at 450
Fifth Street, N.W., Washington, D.C. 20549. You may also obtain copies of the
documents at prescribed rates by writing to the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the
Commission at 1-800-SEC-0330 for further information on the public reference
room. In addition, the registration

                                       55
<Page>
statement and the documents incorporated by reference into this Report are
publicly available through the web site maintained by the Securities and
Exchange Commission at www.sec.gov.

    Documents concerning Stolt Offshore that are referred to in this Report may
be inspected at our principal executive offices, c/o Stolt Offshore M.S. Ltd,
Dolphin House, Windmill Road, Sunbury-on-Thames TW16 7HT England.

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

    We are exposed to market risk, including changes in interest rates and
currency exchange rates. To manage the volatility relating to these exposures on
a consolidated basis, we enter into derivative instruments in accordance with
our company policies. The financial impact of these instruments is offset by
corresponding changes in the underlying exposure being hedged. We do not hold or
issue derivative instruments for trading purposes.

FOREIGN-EXCHANGE RISK MANAGEMENT

    Our exposure to currency rate fluctuations results from our net investments
in foreign subsidiaries, primarily in the United Kingdon, Norway, France and
Brazil, and from our share of the local currency earnings in our operations in
the United Kingdom, Norway and SEAME. We are also exposed to fluctuations in
several other currencies resulting from operating expenditures and one-off
liabilities.

    Our currency rate exposure policy prescribes the range of allowable hedging
activity. We primarily use forward exchange contracts. We do not use derivative
instruments to hedge the value of investments in foreign subsidiaries.

INTEREST-RATE RISK MANAGEMENT

    Our exposure to third-party interest rate fluctuations result primarily from
floating-rate, short-term lines of credit, as well as floating-rate, long-term
revolving credit facilities tied to the London Interbank Offer Rate.

    We use a value-at-risk ("VAR") model to estimate the maximum potential loss
on financial instruments that could occur from adverse movements in either
interest rates or foreign exchange rates which uses a variance/covariance
modeling technique. The VAR model uses historical foreign exchange rates and
interest rates to estimate the volatility and correlation of these rates in
future periods. It estimates a potential one-day loss in the fair market value
of the instruments using statistical modeling techniques and including
substantially all market risk exposures, specifically excluding joint venture
investments. The VAR model estimates were made assuming normal market conditions
and a 95% confidence level based on the average VAR amounts for the periods.

    The 95% confidence level signifies our degree of confidence that actual
losses would not exceed the estimated losses shown in the table below. The
amounts shown here disregard the possibility that interest rates and foreign
currency rates could move favorably. The VAR model assumes that all movements in
these rates would be adverse. Actual experience has shown that gains and losses
tend to offset each other over time, and it is highly unlikely that we could
experience losses such as these over an extended period of time. These amounts
should not be considered to be projections of future losses, since actual
results may differ significantly depending upon activity in the global financial
markets.

                                       56
<Page>
    The fair value losses shown in the table below have no impact on our results
of operations or financial condition.

<Table>
<Caption>
                                                                    VAR
                                                            -------------------
                                                             AS OF NOVEMBER 30
                                                            -------------------
                                                              2001       2000
                                                            --------   --------
                                                              ($ IN MILLIONS)
<S>                                                         <C>        <C>
Interest rates............................................     0.4        1.3
Foreign exchange rates....................................     0.9        1.1
</Table>

    The decrease in the potential fair value losses from 2000 to 2001 is a
result of decreased interest rate deviation over the year.

    A discussion of our accounting policies for financial instruments is
included in Note 2 to the Consolidated Financial Statements, and disclosure
relating to the financial instruments is included in Note 23 to the Consolidated
Financial Statements.

    Based on our overall interest rate exposures as of April 30, 2002, a
near-term change in interest rates would not materially affect our consolidated
financial position, results of operations, or cash flows.

OTHER FINANCIAL INSTRUMENTS

    All of our derivative activities are over the counter instruments entered
into with major financial credit institutions to hedge our committed exposures.
Our derivative instruments are primarily standard foreign exchange forward
contracts which subject us to a minimum level of exposure risk and have
maturities of less than 18 months. We do not consider that we have a material
exposure to credit risk from third parties failing to perform according to the
terms of derivative instruments.

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES.

    None.

                                    PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES.

    None.

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
  PROCEEDS.

    On March 7, 2001, we reclassified our non-voting Class A Shares as Common
Shares on a one-for-one basis. See "Introduction."

ITEM 15. RESERVED.

ITEM 16. RESERVED.

                                    PART III

ITEM 17. FINANCIAL STATEMENTS.

    We have elected to provide financial statements for the fiscal year ended
November 30, 2001 and the related information pursuant to Item 18.

ITEM 18. FINANCIAL STATEMENTS.


    See pages F-1 to F-49, S-1 and S-2, which are incorporated herein by
reference.


                                       57
<Page>
    A.  CONSOLIDATED FINANCIAL STATEMENTS

        Report of Independent Public Accountants.

        Consolidated Statements of Operations for the fiscal years ended
       November 30, 2001, 2000 and 1999.

        Consolidated Balance Sheets as of November 30, 2001 and 2000.

        Consolidated Statements of Shareholders' Equity for the fiscal years
       ended November 30, 2001, 2000 and 1999.

        Consolidated Statements of Cash Flows for the fiscal years ended
       November 30, 2001, 2000 and 1999.


        Notes to Consolidated Financial Statements.



    B.  FINANCIAL STATEMENTS OF MAR PROFUNDO GIRASSOL



        Report of Independent Public Accountants.



        Balance Sheets at December 31, 2001 and 2000.



        Income Statements for the years ended December 31, 2001, 2000 and 1999
       (1999 unaudited).



        Statement of Cash Flows for the years ended December 31, 2001, 2000 and
       1999 (1999 unaudited).



        Notes to Financial Statements.



    C.  REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULES


        Report of Independent Public Accountants

        Schedule II Valuation and Qualifying Accounts

                                       58
<Page>
ITEM 19. EXHIBITS.


<Table>
<C>                     <S>
         1.1            Amended and Restated Articles of Incorporation. Incorporated
                        by reference to Stolt Offshore's Annual Report on Form 20-F
                        for the fiscal year ended November 30, 2000, filed with the
                        Securities and Exchange Commission on May 30, 2001.

         2.1            Amended and Restated Deposit Agreement among Stolt Offshore,
                        Citibank, N.A., as Depositary, and the holders and
                        beneficial owners from time to time of American Depositary
                        Shares. Incorporated by reference to Stolt Offshore's
                        Registration Statement on Form F-6 (File No. 333-90470)
                        filed with the Securities and Exchange Commission on
                        June 10, 2002.

         2.2            Form of American Depositary Receipt (included in Exhibit
                        2.1).

         4.1            Loan Facility Agreement, dated September 22, 2000, among
                        Stolt Comex Seaway Finance B.V., Stolt Offshore's Den norske
                        Bank ASA and the banks listed therein. Incorporated by
                        reference to Stolt Offshore's Annual Report on Form 20-F for
                        the fiscal year ended November 30, 2000, filed with the
                        Securities and Exchange Commission on May 30, 2001.

         8.1            Significant subsidiaries as of the end of the year covered
                        by this Report: see "Significant Subsidiaries" under "Item
                        4. Information on the Company."

        10.1            Consent of Arthur Andersen, Independent Public Accountants.

        10.2            Consent of Elvinger, Hoss & Prussen.

        10.3            Consent of Barbier Frinault & Associes S.A.

        99.1            Letter of Stolt Offshore S.A., addressed to the Securities
                        and Exchange Commission, regarding representations to Stolt
                        Offshore S.A. by Arthur Andersen and Barbier Frinault and
                        Associes. Incorporated by reference to Exhibit 99.2 to
                        Amendment No. 1 to the Registration Statement on Form F-3
                        (File No. 333-86288) filed by Stolt Offshore.
</Table>


                                       59
<Page>
                                   SIGNATURES


    The registrant hereby certifies that it meets all of the requirements for
filing on Form 20-F/A and that it has duly caused and authorized the undersigned
to sign this annual report on its behalf.


<Table>
<S>                                                    <C>  <C>
                                                       STOLT OFFSHORE S.A.

                                                       By:  /s/ MARK WOOLVERIDGE
                                                            -----------------------------------------
                                                            Name: Mark Woolveridge
                                                            Title:  Deputy Chairman of the Board of
                                                                  Directors

                                                       By:  /s/ BRUNO CHABAS
                                                            -----------------------------------------
                                                            Name: Bruno Chabas
                                                            Title:  Chief Financial Officer
</Table>


Date: July 15, 2002


                                       60
<Page>

                         INDEX TO FINANCIAL STATEMENTS



<Table>
<Caption>
                                                                PAGE
                                                              --------
<S>                                                           <C>
AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF STOLT OFFSHORE
  S.A.

Report of Independent Public Accountants....................     F-2

Consolidated Statements of Operations for the years ended
  November 30, 2001, 2000 and 1999..........................     F-3

Consolidated Balance Sheets at November 30, 2001 and 2000...     F-4

Consolidated Statements of Shareholders' Equity for the
  years ended November 30, 2001, 2000, 1999 and 1998........     F-5

Consolidated Statements of Cash Flows for the years ended
  November 30, 2001, 2000 and 1999..........................     F-6

Notes to Consolidated Financial Statements..................     F-7

AUDITED FINANCIAL STATEMENTS OF MAR PROFUNDO GIRASSOL

Report of Independent Public Accountants....................    F-37

Balance Sheets at December 31, 2001 and 2000................    F-38

Income Statements for the years ended December 31, 2001,
  2000 and 1999 (1999 unaudited)............................    F-39

Statement of Cash Flows for the years ended December 31,
  2001, 2000 and 1999
  (1999 unaudited)..........................................    F-40

Notes to Financial Statements...............................    F-41
</Table>


                                      F-1
<Page>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS



To Stolt Offshore S.A.



    We have audited the accompanying consolidated balance sheets of Stolt
Offshore S.A. (a Luxembourg company) and its subsidiaries as of November 30,
2001 and 2000, and the related consolidated statements of operations,
shareholders' equity and cash flows for each of the three years in the period
ended November 30, 2001. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.



    We conducted our audits in accordance with generally accepted auditing
standards in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.



    In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Stolt Offshore S.A. and
subsidiaries as of November 30, 2001 and 2000 and the results of their
operations and their cash flows for each of the three years in the period ended
November 30, 2001, in conformity with accounting principles generally accepted
in the United States.



Arthur Andersen
Glasgow, United Kingdom
January 30, 2002


                                      F-2
<Page>

                     CONSOLIDATED STATEMENTS OF OPERATIONS



<Table>
<Caption>
------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED NOVEMBER 30                                      2001        2000        1999
(IN THOUSANDS, EXCEPT PER SHARE DATA)                                  $           $           $
<S>                                                 <C>      <C>           <C>         <C>
================================================================================================
Net operating revenue                                          1,255,938     983,420     640,726
------------------------------------------------------------------------------------------------
Operating expenses                                           (1,161,553)   (930,046)   (568,304)
================================================================================================
GROSS PROFIT--$                                                   94,385      53,374      72,422
------------------------------------------------------------------------------------------------
          --%                                                       7.5%        5.4%       11.3%
------------------------------------------------------------------------------------------------
Equity in net income of non-consolidated joint
  ventures                                                        11,655       5,793       5,197
------------------------------------------------------------------------------------------------
Administrative and general expenses                             (64,043)    (60,913)    (51,825)
------------------------------------------------------------------------------------------------
Impairment of Comex trade name                      note 2       (7,932)          --          --
------------------------------------------------------------------------------------------------
Restructuring charges                               note 16           --     (3,294)     (1,639)
================================================================================================
NET OPERATING INCOME (LOSS)                                       34,065     (5,040)      24,155
------------------------------------------------------------------------------------------------
NON-OPERATING (EXPENSE) INCOME
------------------------------------------------------------------------------------------------
Interest expense                                                (29,271)    (32,157)    (17,692)
------------------------------------------------------------------------------------------------
Interest income                                                    2,451       2,165         966
------------------------------------------------------------------------------------------------
Foreign currency exchange losses, net                              (323)       (810)        (80)
------------------------------------------------------------------------------------------------
Other income, net                                                  2,300         142         355
================================================================================================
INCOME (LOSS) BEFORE INCOME TAXES AND MINORITY
  INTERESTS                                                        9,222    (35,700)       7,704
------------------------------------------------------------------------------------------------
Income tax (provision) benefit                      note 10     (20,619)       3,778       8,509
================================================================================================
(LOSS) INCOME BEFORE MINORITY INTERESTS                         (11,397)    (31,922)      16,213
------------------------------------------------------------------------------------------------
Minority interests                                               (2,806)     (2,521)          --
================================================================================================
NET (LOSS) INCOME                                               (14,203)    (34,443)      16,213
================================================================================================
EARNINGS PER COMMON SHARE
------------------------------------------------------------------------------------------------
Net (loss) income per Common Share and Common
  Share equivalent:
------------------------------------------------------------------------------------------------
  Basic                                                           (0.16)      (0.44)        0.27
------------------------------------------------------------------------------------------------
  Diluted                                                         (0.16)      (0.44)        0.27
------------------------------------------------------------------------------------------------
WEIGHTED AVERAGE NUMBER OF COMMON SHARES AND
  COMMON SHARE EQUIVALENTS OUTSTANDING              note 2        NUMBER      Number      Number
------------------------------------------------------------------------------------------------
  Basic                                                           87,201      78,774      59,092
------------------------------------------------------------------------------------------------
  Diluted                                                         87,201      78,774      59,545
------------------------------------------------------------------------------------------------
</Table>



    The accompanying notes to the consolidated financial statements are an
integral part of these consolidated financial statements.


                                      F-3
<Page>
                          CONSOLIDATED BALANCE SHEETS

<Table>
<Caption>
----------------------------------------------------------------------------------------------------
AS OF NOVEMBER 30                                                                   2001        2000
(IN THOUSANDS, EXCEPT SHARE DATA)                                                      $           $
<S>                                                           <C>              <C>         <C>
====================================================================================================
ASSETS
----------------------------------------------------------------------------------------------------
CURRENT ASSETS
----------------------------------------------------------------------------------------------------
Cash and cash equivalents                                                         11,670       6,315
----------------------------------------------------------------------------------------------------
Restricted cash deposits                                      note 4               1,296       4,337
----------------------------------------------------------------------------------------------------
Trade receivables                                             note 5             428,601     268,491
----------------------------------------------------------------------------------------------------
Inventories and work-in-progress                              note 6              25,424      33,701
----------------------------------------------------------------------------------------------------
Receivables due from related parties and short-term advances  note 9
  to non-consolidated joint ventures                                              61,140      29,837
----------------------------------------------------------------------------------------------------
Prepaid expenses and other current assets                     note 7              44,836      51,817
====================================================================================================
TOTAL CURRENT ASSETS                                                             572,967     394,498
====================================================================================================
Fixed assets, at cost                                         note 8           1,096,329   1,042,974
----------------------------------------------------------------------------------------------------
Less accumulated depreciation and amortization                note 8           (316,858)   (239,626)
====================================================================================================
Total fixed assets, net                                                          779,471     803,348
====================================================================================================
Deposits and non-current receivables                          note 7              36,192      24,223
----------------------------------------------------------------------------------------------------
Investments in and advances to non-consolidated joint         note 9
  ventures                                                                        35,529      37,004
----------------------------------------------------------------------------------------------------
Deferred taxes                                                note 10             10,386      13,705
----------------------------------------------------------------------------------------------------
Goodwill and other intangible assets                          note 2             122,236     126,733
----------------------------------------------------------------------------------------------------
Prepaid pension asset                                         note 11              3,482       3,261
====================================================================================================
TOTAL ASSETS                                                                   1,560,263   1,402,772
====================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
----------------------------------------------------------------------------------------------------
CURRENT LIABILITIES
----------------------------------------------------------------------------------------------------
Bank overdrafts                                               note 12              5,240       1,767
----------------------------------------------------------------------------------------------------
Short-term payables due to SNSA                               note 15              9,482       8,512
----------------------------------------------------------------------------------------------------
Current maturities of long-term debt and capital lease        note 13
  obligations                                                                     23,653       3,844
----------------------------------------------------------------------------------------------------
Accounts payable and accrued liabilities                      note 14            349,440     255,624
----------------------------------------------------------------------------------------------------
Accrued salaries and benefits                                                     41,515      36,736
----------------------------------------------------------------------------------------------------
Other current liabilities                                                         65,445      75,344
====================================================================================================
TOTAL CURRENT LIABILITIES                                                        494,775     381,827
====================================================================================================
Long-term debt and capital lease obligations                  note 13            335,026     288,653
----------------------------------------------------------------------------------------------------
Deferred taxes                                                note 10             18,194      26,743
----------------------------------------------------------------------------------------------------
Other long-term liabilities                                                       39,955      30,505
----------------------------------------------------------------------------------------------------
Accrued pension liability                                     note 11              4,992       3,797
----------------------------------------------------------------------------------------------------
Minority interests                                                                 7,299       1,798
====================================================================================================
TOTAL LONG-TERM LIABILITIES                                                      405,466     351,496
====================================================================================================
Commitments and contingencies                                 notes 17 and 22
----------------------------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY                                          note 19
----------------------------------------------------------------------------------------------------
Common Shares, $2.00 par value--140,000,000 shares
  authorized (2000: 34,000,000), 70,228,536 shares issued
  and outstanding (2000: 22,723,134)                                             140,457      45,446
----------------------------------------------------------------------------------------------------
Class A Shares, $2.00 par value--nil shares authorized
  (2000: 68,000,000), nil shares issued and outstanding
  (2000: 47,429,790)                                                                  --      94,860
----------------------------------------------------------------------------------------------------
Class B Shares, $2.00 par value--34,000,000 shares
  authorized, issued and outstanding (2000: 34,000,000)                           68,000      68,000
----------------------------------------------------------------------------------------------------
Paid-in surplus                                                                  463,615     463,379
----------------------------------------------------------------------------------------------------
Retained earnings                                                                 52,436      66,639
----------------------------------------------------------------------------------------------------
Accumulated comprehensive loss                                                  (64,486)    (68,875)
====================================================================================================
TOTAL SHAREHOLDERS' EQUITY                                                       660,022     669,449
====================================================================================================
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                     1,560,263   1,402,772
====================================================================================================
</Table>

    The accompanying notes to the consolidated financial statements are an
integral part of these consolidated financial statements.

                                      F-4
<Page>
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<Table>
<Caption>
--------------------------------------------------------------------------------------------------------------------------
                                                                                               Accumulated           Total
                                      Common    Class A    Class B    Paid-in    Retained    comprehensive   shareholders'
                                      Shares     Shares     Shares    surplus    earnings             loss          equity
(in thousands, except share data)          $          $          $          $           $                $               $
<S>                                <C>         <C>        <C>        <C>        <C>         <C>              <C>
==========================================================================================================================
BALANCE, NOVEMBER 30, 1998            44,731     39,360     68,000    178,290      84,869         (14,700)         400,550
--------------------------------------------------------------------------------------------------------------------------
Net income                                --         --         --         --      16,213               --          16,213
--------------------------------------------------------------------------------------------------------------------------
Translation adjustments, net              --         --         --         --          --          (8,825)         (8,825)
--------------------------------------------------------------------------------------------------------------------------
Comprehensive income                      --         --         --         --          --               --              --
--------------------------------------------------------------------------------------------------------------------------
Exercise of share options                182         62         --        339          --               --             583
--------------------------------------------------------------------------------------------------------------------------
Other, net                                --         --         --       (78)          --               --            (78)
==========================================================================================================================
BALANCE, NOVEMBER 30, 1999            44,913     39,422     68,000    178,551     101,082         (23,525)         408,443
--------------------------------------------------------------------------------------------------------------------------
Issuance of 1,758,242 Class A
  Shares                                  --      3,516         --     21,934          --               --          25,450
--------------------------------------------------------------------------------------------------------------------------
Issuance of 6,142,857 Class A
  Shares                                  --     12,286         --    101,357          --               --         113,643
--------------------------------------------------------------------------------------------------------------------------
Issuance of 10,341,261 Class A
  Shares                                  --     20,683         --     79,317          --               --         100,000
--------------------------------------------------------------------------------------------------------------------------
Issuance of 9,433,962 Class A
  Shares                                  --     18,868         --     81,132          --               --         100,000
--------------------------------------------------------------------------------------------------------------------------
Net loss                                  --         --         --         --    (34,443)               --        (34,443)
--------------------------------------------------------------------------------------------------------------------------
Translation adjustments, net              --         --         --         --          --         (45,350)        (45,350)
--------------------------------------------------------------------------------------------------------------------------
Comprehensive loss                        --         --         --         --          --               --              --
--------------------------------------------------------------------------------------------------------------------------
Exercise of share options                533         85         --      1,280          --               --           1,898
--------------------------------------------------------------------------------------------------------------------------
Other, net                                --         --         --      (192)          --               --           (192)
==========================================================================================================================
BALANCE, NOVEMBER 30, 2000            45,446     94,860     68,000    463,379      66,639         (68,875)         669,449
--------------------------------------------------------------------------------------------------------------------------
Reclassification of Class A
  Shares to Common Shares             94,860   (94,860)         --         --          --               --              --
--------------------------------------------------------------------------------------------------------------------------
Net loss                                  --         --         --         --    (14,203)               --        (14,203)
--------------------------------------------------------------------------------------------------------------------------
Translation adjustment in respect
  of SFAS No. 133                         --         --         --         --          --          (2,238)         (2,238)
--------------------------------------------------------------------------------------------------------------------------
Gain on hedging reclassified into
  earnings                                --         --         --         --          --            2,238           2,238
--------------------------------------------------------------------------------------------------------------------------
Translation adjustments, net              --         --         --         --          --            4,389           4,389
--------------------------------------------------------------------------------------------------------------------------
Comprehensive loss                        --         --         --         --          --               --              --
--------------------------------------------------------------------------------------------------------------------------
Exercise of share options                151         --         --        376          --               --             527
--------------------------------------------------------------------------------------------------------------------------
Other, net                                --         --         --      (140)          --               --           (140)
==========================================================================================================================
BALANCE, NOVEMBER 30, 2001           140,457         --     68,000    463,615      52,436         (64,486)         660,022
==========================================================================================================================

<Caption>
---------------------------------  ---------------
                                     Comprehensive
                                            income
                                            (loss)
(in thousands, except share data)                $
<S>                                <C>
=================================
BALANCE, NOVEMBER 30, 1998
---------------------------------
Net income                                  16,213
---------------------------------
Translation adjustments, net               (8,825)
---------------------------------
Comprehensive income                         7,388
---------------------------------
Exercise of share options
---------------------------------
Other, net
=================================
BALANCE, NOVEMBER 30, 1999
---------------------------------
Issuance of 1,758,242 Class A
  Shares
---------------------------------
Issuance of 6,142,857 Class A
  Shares
---------------------------------
Issuance of 10,341,261 Class A
  Shares
---------------------------------
Issuance of 9,433,962 Class A
  Shares
---------------------------------
Net loss                                  (34,443)
---------------------------------
Translation adjustments, net              (45,350)
---------------------------------
Comprehensive loss                        (79,793)
---------------------------------
Exercise of share options
---------------------------------
Other, net
=================================
BALANCE, NOVEMBER 30, 2000
---------------------------------
Reclassification of Class A
  Shares to Common Shares
---------------------------------
Net loss                                  (14,203)
---------------------------------
Translation adjustment in respect
  of SFAS No. 133                          (2,238)
---------------------------------
Gain on hedging reclassified into
  earnings                                   2,238
---------------------------------
Translation adjustments, net                 4,389
---------------------------------
Comprehensive loss                         (9,814)
---------------------------------
Exercise of share options
---------------------------------
Other, net
=================================
BALANCE, NOVEMBER 30, 2001
=================================
</Table>

    The accompanying notes to the consolidated financial statements are an
integral part of these consolidated financial statements.

                                      F-5
<Page>

                     CONSOLIDATED STATEMENTS OF CASH FLOWS



<Table>
<Caption>
----------------------------------------------------------------------------------------------
FOR THE YEAR ENDED NOVEMBER 30                                     2001        2000       1999
(IN THOUSANDS)                                                        $           $          $
<S>                                                           <C>         <C>         <C>
==============================================================================================
CASH FLOWS FROM OPERATING ACTIVITIES
----------------------------------------------------------------------------------------------
Net (loss) income                                              (14,203)    (34,443)     16,213
----------------------------------------------------------------------------------------------
ADJUSTMENTS TO RECONCILE NET (LOSS) INCOME TO NET CASH
  PROVIDED BY OPERATING ACTIVITIES
----------------------------------------------------------------------------------------------
Depreciation and amortization                                    91,750      82,117     56,136
----------------------------------------------------------------------------------------------
Impairment of Comex trade name                                    7,932          --         --
----------------------------------------------------------------------------------------------
Amortization of drydock costs                                     8,441       3,985      3,793
----------------------------------------------------------------------------------------------
Equity in earnings of non-consolidated joint ventures          (11,655)     (5,793)    (5,197)
----------------------------------------------------------------------------------------------
Minority interest in consolidated subsidiaries                    2,806       2,521         --
----------------------------------------------------------------------------------------------
Deferred tax                                                    (4,434)    (16,731)   (15,668)
----------------------------------------------------------------------------------------------
Gain on sale of assets                                          (1,234)       (572)      (290)
----------------------------------------------------------------------------------------------
CHANGES IN OPERATING ASSETS AND LIABILITIES, NET OF
  ACQUISITIONS
----------------------------------------------------------------------------------------------
Trade receivables                                             (141,003)      18,316     42,320
----------------------------------------------------------------------------------------------
Prepaid expenses and other current assets                        10,024    (18,576)        774
----------------------------------------------------------------------------------------------
Inventories and work-in-progress                                  8,241    (13,160)      4,653
----------------------------------------------------------------------------------------------
Accounts and notes payable                                       91,022      29,094   (53,737)
----------------------------------------------------------------------------------------------
Accrued salaries and benefits                                       635     (5,517)    (8,793)
----------------------------------------------------------------------------------------------
Other short-term and other long-term liabilities               (25,928)      28,630      2,239
----------------------------------------------------------------------------------------------
Payments of drydock costs                                      (17,893)    (11,638)    (2,108)
==============================================================================================
NET CASH PROVIDED BY OPERATING ACTIVITIES                         4,501      58,233     40,335
==============================================================================================
CASH FLOWS USED IN INVESTING ACTIVITIES
----------------------------------------------------------------------------------------------
Acquisition of subsidiaries, net of cash acquired                  (61)   (111,175)         --
----------------------------------------------------------------------------------------------
Purchase of fixed assets                                       (62,868)    (61,724)   (90,918)
----------------------------------------------------------------------------------------------
Proceeds from sale of fixed and intangible assets                 5,590      19,157      2,807
----------------------------------------------------------------------------------------------
(Increase) decrease in investments and other non-current
  financial assets                                             (26,089)     (6,886)        680
----------------------------------------------------------------------------------------------
Dividends from non-consolidated joint ventures                   12,235          --     11,640
==============================================================================================
NET CASH USED IN INVESTING ACTIVITIES                          (71,193)   (160,628)   (75,791)
==============================================================================================
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES
----------------------------------------------------------------------------------------------
Net increase (decrease) in bank overdrafts                        3,332   (104,323)      5,624
----------------------------------------------------------------------------------------------
Proceeds from issuance of long-term debt                         69,985     340,000     34,000
----------------------------------------------------------------------------------------------
Repayments of long-term debt                                         --   (175,597)    (1,370)
----------------------------------------------------------------------------------------------
Decrease (increase) in restricted cash deposits securing
  capital lease obligations and accrued taxation liabilities      2,628     (2,601)    (1,012)
----------------------------------------------------------------------------------------------
Repayments of capital lease obligations                         (3,845)     (5,425)    (3,117)
----------------------------------------------------------------------------------------------
Decrease in funding from affiliate                                   --   (150,000)         --
----------------------------------------------------------------------------------------------
Proceeds from the issuance of Class A Shares                         --     199,808         --
----------------------------------------------------------------------------------------------
Exercise of share options                                           387       1,898        583
==============================================================================================
NET CASH PROVIDED BY FINANCING ACTIVITIES                        72,487     103,760     34,708
==============================================================================================
Effect of exchange rate changes on cash                           (440)       (902)    (2,775)
==============================================================================================
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS              5,355         463    (3,523)
----------------------------------------------------------------------------------------------
Cash and cash equivalents at beginning of year                    6,315       5,852      9,375
==============================================================================================
CASH AND CASH EQUIVALENTS AT END OF YEAR                         11,670       6,315      5,852
==============================================================================================
</Table>



    The accompanying notes to the consolidated financial statements are an
integral part of these consolidated financial statements.


                                      F-6
<Page>

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



1.  THE COMPANY



    Stolt Offshore S.A. ("the Company") is one of the largest offshore
contractors in the world with services covering all phases of subsea offshore
oil and gas operations from exploration to decommissioning. The Company operates
in more than 60 countries worldwide and maintains regional offices in the United
Kingdom; Norway; Asia Pacific; Southern Europe, Africa and the Middle East
("SEAME"); South America; and North America.



    The market for the Company's services is dependent upon the success of
exploration and the level of development and production expenditures in the oil
and gas industry. Such expenditures are cyclical in nature and influenced by
prevailing and anticipated oil and gas prices.



    The Company has investments in several joint ventures, the most significant
of which is Mar Profundo Girassol, a joint venture with a French engineering
company. The Company's share of the joint venture's net income is 50%.



    The remainder of the joint ventures in which the Company has interests, with
the exception of Seaway Heavy Lifting Limited ("SHL") and NKT Flexibles I/S,
have been entered into on project specific bases to enhance the range of
services provided to the customer. In these joint ventures, the Company will
typically have interests ranging from 25% to 55%.



2.  ACCOUNTING POLICIES



PRINCIPLES OF CONSOLIDATION



    The consolidated financial statements have been prepared in accordance with
generally accepted accounting principles in the U.S. and include the accounts of
all majority-owned companies in which the Company has operating control. All
significant intercompany transactions and balances have been eliminated. The
Company accounts for its non-consolidated joint ventures under the equity
method.



    The Company records minority interest expense, which reflects the portion of
the earnings of the majority-owned operations that are applicable to the
minority interest partners. Following the acquisition of ETPM S.A. ("ETPM") in
2000, the Company increased its holding in Alto Mar Girassol from 33 1/3% to
66 2/3%. The minority interest amounts recorded in the accompanying consolidated
financial statements primarily represent the share of minority partners interest
in this entity and minority partners 62% interest in Paragon Engineering
Holdings, Inc., the recently acquired engineering service group which is
discussed further in Note 3.



FOREIGN CURRENCY TRANSLATION



    The Company, incorporated in Luxembourg, has U.S. Dollar share capital and
dividends are expected to be paid in U.S. Dollars. As a result, the Company's
reporting currency is the U.S. Dollar.



    The Company translates the financial statements of its subsidiaries from
their functional currencies (usually local currencies) into U.S. Dollars. Assets
and liabilities denominated in foreign currencies are translated at the exchange
rates in effect at the balance sheet date. Revenue and expenses are translated
at exchange rates which approximate the average exchange rates prevailing during
the period. The resulting translation adjustments are recorded in a separate
component of accumulated comprehensive loss as "Translation adjustments, net" in
the accompanying consolidated statements of shareholders' equity. Exchange gains
and losses resulting from transactions denominated in a currency other than that
of the functional currency are included in "Foreign currency exchange losses,
net" in the accompanying consolidated statements of operations. The functional
currencies of the companies


                                      F-7
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



2.  ACCOUNTING POLICIES (CONTINUED)


that comprise the Norway region and the U.K. region are Norwegian Kroner and
British Pound, respectively. The U.S. Dollar is the functional currency of the
most significant subsidiaries within the Asia Pacific, North America, SEAME and
South America regions.



    The Company uses derivative instruments, primarily foreign exchange forward
contracts, to reduce its exposure to currency fluctuations. All of the
instruments used are hedges against forecasted underlying operating or balance
sheet exposures, the former designated as cash flow hedges and the latter
designated as fair value hedges. The Company does not enter into open
speculative positions. Effective December 1, 2000, the Company adopted Statement
of Financial Accounting Standards ("SFAS") No. 133, "ACCOUNTING FOR DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES", as amended, which requires that all
derivative instruments be reported on the balance sheet at fair value and
establishes criteria for designation and effectiveness of hedging relationships.
If the derivative is designated as a cash flow hedge, the effective portions of
the changes in the fair value of the derivative instrument are recorded in other
comprehensive income ("OCI") and are recognized in the statement of operations
when the hedged item affects earnings. If the derivative instrument is
designated as a fair value hedge, the changes in the fair value of the
derivative instrument and of the hedged item attributable to the hedged risk are
recognized in the results of operations. Ineffective portions of changes in the
fair value or the cash flow hedges are recognized in earnings. The cumulative
effect of adopting SFAS No. 133 was not material. See the further discussion on
derivative instruments in Note 23.



REVENUE RECOGNITION



    Long-term contracts are accounted for using the percentage-of-completion
method. Revenue and gross profit are recognized each period based upon the
advancement of the work-in-progress, which is based on the ratio of costs
incurred to date to the total estimated costs, taking into account the level of
physical completion. Where the stage of completion is insufficient to enable a
reasonably certain forecast of gross profit to be established, no gross profit
is recognized during the period. Provisions for anticipated losses are made in
the period in which they become known.



    A major portion of the Company's revenue is billed under fixed-price
contracts. However, due to the nature of the services performed, variation
orders are commonly billed to the customers in the normal course of business and
are recognized as contract revenue only after agreement from the customers has
been reached on the scope of work and fees to be charged.



    The financial reporting of the Company's contracts depends on estimates,
which are assessed continually during the term of these contracts. Recognized
revenues and profits are subject to revisions as the contract progresses to
completion, and revisions in profit estimates are reflected in the period in
which the facts that give rise to the revision become known. The net effect on
net income of significant revisions to contract estimates was $2.4 million,
$(10.7) million and $0.0 million in 2001, 2000 and 1999, respectively. The net
effect of these revisions on net (loss) income per share was $0.03, $(0.14) and
$0.0 in 2001, 2000 and 1999, respectively.



FIXED ASSETS



    Fixed assets are recorded at cost or fair market value when obtained through
acquisition. Interest costs incurred between the date that financing is provided
for an asset and the date that the asset is ready for use are capitalized. No
interest was capitalized for the years ended November 30, 2001, 2000 or 1999.
Assets acquired pursuant to capital leases are capitalized at the present value
of the underlying lease obligations and amortized on the same basis as fixed
assets described below.


                                      F-8
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



2.  ACCOUNTING POLICIES (CONTINUED)


    Depreciation of fixed assets is recorded on a straight-line basis over the
useful lives of the assets as follows:



<Table>
<S>                                                           <C>
----------------------------------------------------------------------------
Construction support ships                                     6 to 25 years

Operating equipment                                            7 to 10 years

Buildings                                                     20 to 33 years

Other assets                                                   5 to 10 years
----------------------------------------------------------------------------
</Table>



    Ships are depreciated to a residual value of 10% of acquisition cost, which
reflects management's estimate of salvage or otherwise recoverable value. No
residual value is assumed with respect to other fixed assets.



    Costs for fitting out construction support ships are capitalized and
amortized over a period equal to the remaining useful life of the related
equipment. Permanent marine inventories on ships are depreciated in a manner
similar to their related ships.



    Depreciation expense, which includes amortization of assets under capital
leases, was approximately $86.0 million for the year ended November 30, 2001
(2000: $76.2 million and 1999: $50.3 million).



    On December 1, 1999 the Company changed its accounting policy for drydock
costs from an accrual basis to a deferral basis. Amortization of capitalized
drydock costs was $8.4 million for the year ended November 30, 2001 (2000:
$4.0 million and 1999: $3.8 million). The unamortized portion of capitalized
drydock costs of $21.2 million (2000: $11.9 million) is included in "Deposits
and non-current receivables" in the accompanying consolidated balance sheets.



    Maintenance and repair costs, which are expensed as incurred, were
$42.1 million for the year ended November 30, 2001 (2000: $44.2 million and
1999: $33.7 million).



GOODWILL AND OTHER INTANGIBLE ASSETS



    Goodwill represents the excess of the purchase price over the fair value of
net assets acquired. Goodwill arising on acquisitions prior to June 30, 2001 is
being amortized on a straight-line basis over 15 to 30 years and is reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying value may not be recoverable. Goodwill arising after this date will not
be amortized in accordance with SFAS No. 142, "GOODWILL AND OTHER INTANGIBLE
ASSETS" and is tested for impairment on an annual basis or earlier whenever
indicators of impairment arise.



    Included in the net book value of intangible assets at November 30, 2001 was
goodwill of $120.1 million (2000: $117.7 million) and other intangible assets of
$2.1 (2000: $9.0 million). The amortization expense for the year ended
November 30, 2001 was $5.7 million excluding the one-off impairment charge for
the Comex trade name as discussed below (2000: $5.9 million and 1999:
$5.8 million).



    During the year ended November 30, 2001, in light of the increased worldwide
recognition of the Stolt Offshore name, the Company reviewed the carrying value
of its former trade name Comex for possible impairment in accordance with SFAS
No. 121, "ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS AND FOR LONG-LIVED
ASSETS TO BE DISPOSED OF". The Company determined that the value of the


                                      F-9
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



2.  ACCOUNTING POLICIES (CONTINUED)


trade name had been impaired and recorded a charge of $7.9 million in its
results of operations for the write-down of the trade name.



CASH AND CASH EQUIVALENTS



    Cash and cash equivalents include time deposits and certificates of deposit
with an original maturity of three months or less.



EARNINGS PER SHARE



    Earnings per share is computed using the weighted average number of Common
and Class B Shares and equivalents outstanding during each period. The
computations for the three years ended November 30, 2001 are based upon the
following outstanding shares:



<Table>
===============================================================================================
AS OF NOVEMBER 30                                                2001         2000         1999
===============================================================================================
<S>                                                        <C>          <C>          <C>
BASIC
-----------------------------------------------------------------------------------------------
Common Shares                                              70,201,030   61,774,156   42,091,928
-----------------------------------------------------------------------------------------------
Class B Shares                                             17,000,000   17,000,000   17,000,000
===============================================================================================
TOTAL                                                      87,201,030   78,774,156   59,091,928
===============================================================================================
DILUTED
-----------------------------------------------------------------------------------------------
Common Shares                                              70,201,030   61,774,156   42,544,870
-----------------------------------------------------------------------------------------------
Class B Shares                                             17,000,000   17,000,000   17,000,000
===============================================================================================
TOTAL                                                      87,201,030   78,774,156   59,544,870
===============================================================================================
Basic                                                      87,201,030   78,774,156   59,091,928
-----------------------------------------------------------------------------------------------
Potentially dilutive share options                                 --           --      452,942
===============================================================================================
Diluted                                                    87,201,030   78,774,156   59,544,870
===============================================================================================
</Table>



    The diluted loss per share for the year ended November 30, 2001 does not
include common share equivalents in respect of share options of 415,941 as their
effect would be anti-dilutive (2000: 624,373).



    Class B Shares have only 50% of the economic rights of Common Shares.



    All share data and per share data have been restated to reflect the share
reclassification on March 7, 2001 whereby Class A Shares were reclassified to
Common Shares on a one-for-one basis.



STOCK BASED COMPENSATION



    The Company has elected to account for its stock based compensation awards
to employees and directors under Accounting Principles Board ("APB") Opinion
No. 25 and to provide the disclosures required by SFAS No. 123, "ACCOUNTING FOR
STOCK BASED COMPENSATION" in Note 20.


                                      F-10
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



2.  ACCOUNTING POLICIES (CONTINUED)


CONSOLIDATED STATEMENT OF CASH FLOWS



    Cash interest and cash paid for income taxes during the year ended
November 30, 2001 were $27.2 million and $13.7 million, respectively, (2000:
$27.0 million and $8.0 million, respectively, and 1999: $7.1 million and
$10.4 million, respectively).



IMPACT OF NEW ACCOUNTING STANDARDS



    In July 2001, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 141, "BUSINESS COMBINATIONS" and SFAS No. 142, "GOODWILL AND OTHER
INTANGIBLE ASSETS". SFAS No. 141 applies to all business combinations with a
closing date after June 30, 2001 and eliminates the pooling-of-interests method
of accounting and further clarifies the criteria for recognition of intangible
assets separately from goodwill. SFAS No. 142 eliminates the amortization of
goodwill and indefinite-lived intangible assets and initiates an annual review
for impairment. Identifiable intangible assets with determinable useful lives
will continue to be amortized. The amortization provisions apply to goodwill and
to other intangible assets acquired after June 30, 2001. Goodwill and other
intangible assets acquired prior to June 30, 2001 will be affected upon
adoption. The Company will adopt SFAS No. 142 for the fiscal year commencing
December 1, 2002 which will require the Company to cease amortization of its
remaining net goodwill balance and perform an impairment test of its existing
goodwill based on a fair value concept. The Company has not determined the
impact that these Statements will have on goodwill and other intangible assets
or whether a cumulative effect adjustment will be required upon adoption to
reflect the impairment of previously recognized goodwill and other intangible
assets.



    In June 2001, the FASB issued SFAS No. 143, "ACCOUNTING FOR ASSET RETIREMENT
OBLIGATIONS". SFAS No. 143 requires that the fair value of a liability for an
asset retirement obligation be recognized in the period in which it is incurred
if a reasonable estimate of fair value can be made. The associated asset
retirement costs are capitalized as part of the carrying amount of the
long-lived asset. Changes in the liability for an asset retirement due the
passage of time shall be recognized as an increase in the carrying amount of the
liability and as an operating expense in the statement of operations. SFAS
No. 143 is effective for fiscal years beginning after June 15, 2002. The Company
does not anticipate that adoption of SFAS No. 143 will have a material impact on
its results of operations or its financial position.



    In August 2001, the FASB issued SFAS No. 144, "ACCOUNTING FOR THE IMPAIRMENT
OR DISPOSAL OF LONG-LIVED ASSETS". SFAS No. 144 superseded SFAS No. 121,
"ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS AND FOR LONG-LIVED ASSETS TO
BE DISPOSED OF." SFAS No. 144 primarily addresses significant issues relating to
the implementation of SFAS No. 121 and develops a single accounting model for
long-lived assets to be disposed of by sale that is consistent with the
fundamental provisions of SFAS No. 121. SFAS No. 144 is effective for fiscal
years beginning after December 15, 2001. The Company currently has no plans to
dispose of any operations and, accordingly, does not anticipate that adoption of
SFAS No. 144 will have a material impact on its results of operations or its
financial position.



COMPARATIVE AMOUNTS



    Certain amounts within the 2000 financial statements have been reclassified
to conform with the 2001 presentation.


                                      F-11
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



3.  BUSINESS ACQUISITIONS



    On March 30, 2001, the Company acquired 82% of the voting rights and 62% of
the economic rights of a newly created company, Paragon Engineering
Holdings, Inc. ("PEH"). PEH subsequently purchased 20% of the share capital of
Paragon Engineering Services, Inc. ("Paragon"), a Houston-based engineering
service company, and an option to purchase an additional 40% of the share
capital. PEH exercised the option on September 4, 2001. On July 18, 2001, the
Company purchased the entire share capital of the Paris-based engineering
company Ingerop Litwin ("Litwin"). These acquisitions, by adding conceptual
design and detailed engineering services, will enable the Company to better
undertake all engineering required on many of the large engineering,
procurement, installation and commission type contracts that are expected to
come into the market in the next few years.



    The consideration, including acquisition costs, paid to acquire Paragon and
Litwin was $16.7 million of which $4.3 million in relation to the Paragon
acquisition has been deferred for payment until March 30, 2005. The net present
value of the deferred payment has been included in "Other long-term liabilities"
in the accompanying balance sheet. Additionally, from March 30, 2005, the
Paragon sale agreement provides for a payment to be made to a former shareholder
of Paragon, under the terms of a put and call option. This payment is contingent
upon a multiplier of the future earnings of Paragon, as defined in the
agreement, exceeding the deferred consideration. No recognition of the
contingent payment has been made in the financial statements of the Company as
it is not certain beyond reasonable doubt that this payment will be made and
currently it is not possible to quantify the amount.



    The results of Paragon have been included in the consolidated results of
operations from September 4, 2001, when the Company assumed effective control of
the entity. The amount which represents the minority shareholders' interests in
the results of Paragon, effectively 62%, has been recorded as minority interest
expense in the results of operations of the Company. The results of Litwin have
been included in the consolidated results of operations from July 18, 2001.



    The following table summarizes the estimated fair values of the assets
acquired and the liabilities assumed at the date of acquisition. The Company is
in the process of obtaining third-party valuations of certain intangible assets,
thus the allocation of the purchase price is subject to refinement. All
intangible assets other than goodwill, which are mainly customer lists and
various engineering databases, are subject to amortization over estimated useful
lives of three to 10 years.



<Table>
======================================================================
(in thousands)                                                       $
======================================================================
<S>                                                           <C>
Current assets                                                  30,989
----------------------------------------------------------------------
Fixed assets, at cost                                            2,538
----------------------------------------------------------------------
Intangible assets                                                2,066
----------------------------------------------------------------------
Goodwill                                                         8,475
----------------------------------------------------------------------
Other non-current assets                                           939
======================================================================
Total assets acquired                                           45,007
----------------------------------------------------------------------
Current liabilities                                           (23,897)
----------------------------------------------------------------------
Non-current liabilities                                          (799)
----------------------------------------------------------------------
Minority interest                                              (3,657)
======================================================================
Net assets acquired                                             16,654
======================================================================
</Table>


                                      F-12
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



3.  BUSINESS ACQUISITIONS (CONTINUED)


    On December 7, 1999, the Company completed a transaction to form a joint
venture entity, NKT Flexibles I/S ("NKT"), a manufacturer of flexible flowlines
and dynamic flexible risers for the offshore oil and gas industry. The
transaction was effected through the acquisition of Danco A/S, a wholly-owned
Norwegian company, which holds the investment in NKT. NKT is owned 51% by NKT
Holdings A/S, and 49% by the Company through Danco A/S. The total consideration
for the acquisition was $36.0 million: $10.5 million cash and the issue of
1,758,242 Class A Shares, with an average guaranteed value of $14.475 per share
for a value of $25.5 million. The Class A Shares have subsequently been
converted to Common Shares on a one-for-one basis. As of November 30, 2001, the
Company continued to have an obligation for an average guaranteed value of
$14.95 over 1,128,742 Common Shares.



    The acquisition of Danco A/S has been accounted for by the purchase method
of accounting and, accordingly, the operating results have been included in the
Company's results of operations from the date of acquisition. The excess of cash
paid over the fair value of net assets acquired has been recorded as goodwill of
$2.1 million at the date of acquisition. The goodwill is being amortized over
10 years. The Company accounts for the investment in NKT as a non-consolidated
joint venture under the equity method.



    On December 16, 1999, the Company acquired approximately 55% of the French
offshore construction and engineering company ETPM S.A. ("ETPM"), a wholly-owned
subsidiary of Groupe GTM S.A. ("GTM"). GTM has subsequently been acquired by
Groupe Vinci S.A. ("Vinci"). The remaining 45% of ETPM was acquired on
February 4, 2000.



    The total consideration for the acquisition was $350.0 million and was
comprised of the following items: (i) $111.6 million in cash; (ii) the issue of
6,142,857 Class A Shares, which have subsequently converted to Common Shares on
a one-for-one basis, with a minimum guarantee price of $18.50 per share for a
total value of $113.6 million; (iii) the assumption of debt of $18.4 million due
from ETPM to GTM and debt of $71.0 million due to third parties;
(iv) acquisition costs of $3.4 million; and (v) $32.0 million being the net
present value at acquisition of a hire purchase arrangement for two ships owned
by GTM, the SEAWAY POLARIS and the DLB 801, with an early purchase option after
two years.



    The acquisition has been accounted for by the purchase method of accounting
and, accordingly, the operating results have been included in the Company's
results of operations from the date of acquisition. The acquisition generated
negative goodwill of $5.8 million and non-current assets have been reduced by
this amount.



    The acquisition was initially funded by cash provided by Stolt-Nielsen S.A.
("SNSA"), the Company's majority shareholder, and was replaced by a bridge
finance facility which has subsequently been repaid.



    As described more fully in Note 24, Vinci has advised the Company of its
intention to sell all of the Common Shares given as partial consideration by the
Company for the acquisition of ETPM. The Company, in turn, has advised Vinci
that it will organize the sale. As specified in the ETPM acquisition agreement,
the minimum share price guarantee of $18.50 per share will apply.



    The following unaudited pro forma information presents a summary of the
consolidated results of operations of the Company, Paragon and Litwin as if the
acquisitions occurred at the beginning of 2000 and the consolidated results of
operations of the Company, ETPM and Danco A/S as if the acquisitions occurred at
the beginning of 1999. Pro forma adjustments include depreciation and
amortization,


                                      F-13
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



3.  BUSINESS ACQUISITIONS (CONTINUED)


interest charges on debt and lines of credit, elimination of deferred gains,
adjustments to operating lease expense, pension adjustments, elimination of
related party transactions and the tax adjustments associated with the above.
The pro forma consolidated results of operations for the year ended
November 30, 2000 would not be materially different from the actual results in
respect of the acquisitions of ETPM and Danco A/S as the acquisitions occurred
close to the start of the financial year.



    Pro forma results for the Company, Paragon and Litwin.



<Table>
===================================================================================
                                                                          (unaudited)
FOR THE YEAR ENDED NOVEMBER 30                                     2001        2000
(in thousands, except per share data)                                 $           $
===================================================================================
<S>                                                           <C>         <C>
Net operating revenue                                         1,313,289   1,030,748
-----------------------------------------------------------------------------------
Net loss                                                        (14,193)   (40,277)
-----------------------------------------------------------------------------------
Net loss per share:
-----------------------------------------------------------------------------------
  Basic                                                           (0.16)     (0.51)
-----------------------------------------------------------------------------------
  Diluted                                                         (0.16)     (0.51)
===================================================================================
</Table>



    Pro forma results for the Company, ETPM and Danco A/S.



<Table>
=======================================================================
                                                              (unaudited)
FOR THE YEAR ENDED NOVEMBER 30                                     1999
(in thousands, except per share data)                                 $
=======================================================================
<S>                                                           <C>
Net operating revenue                                         1,360,678
-----------------------------------------------------------------------
Net income                                                       25,683
-----------------------------------------------------------------------
Net income per share:
-----------------------------------------------------------------------
  Basic                                                            0.33
-----------------------------------------------------------------------
  Diluted                                                          0.33
=======================================================================
</Table>



    The pro forma consolidated results do not purport to be indicative of
results that would have occurred had the acquisitions been in effect for the
period presented, nor do they purport to be indicative of the results that will
be obtained in the future.



    The Company's revenue for 2001 included sales of $1.1 million to Paragon.
The Company's revenue for 1999 included sales of $2.1 million to ETPM.



4.  RESTRICTED CASH DEPOSITS



    Restricted cash balances comprise both funds held in a separate Company bank
account, which will be used to settle accrued taxation liabilities, and deposits
made by the Company as security for certain third-party obligations. There are
no other significant conditions on the restricted cash balances.



5.  TRADE RECEIVABLES



    Trade receivables at November 30, 2001 of $428.6 million (2000:
$268.5 million) are net of allowances for doubtful accounts of $9.2 million
(2000: $8.3 million). Included in trade receivables at


                                      F-14
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



5.  TRADE RECEIVABLES (CONTINUED)


November 30, 2001 was $215.1 million (2000: $99.8 million) of unbilled
receivables and $1.2 million (2000: $.8 million) of retainage.



6.  INVENTORIES AND WORK-IN-PROGRESS



    Inventories and work-in-progress are stated at the lower of cost or market
value and comprise the following:



<Table>
=================================================================================
AS OF NOVEMBER 30                                                2001       2000
(in thousands)                                                      $          $
=================================================================================
<S>                                                           <C>        <C>
Materials and supplies, net of reserve of $4,181 (2000:
  $2,423)                                                      14,620     11,789
---------------------------------------------------------------------------------
Spare parts, net of reserve of $1,402 (2000: $1,502)            4,281      5,027
---------------------------------------------------------------------------------
Work-in-progress and mobilizations                              4,227     14,441
---------------------------------------------------------------------------------
Fuels                                                           2,237      2,398
---------------------------------------------------------------------------------
Other                                                              59         46
=================================================================================
                                                               25,424     33,701
=================================================================================
</Table>



    Costs are generally determined in accordance with the weighted-average cost
method. Costs of fitting out and preparing equipment for specific contracts are
included in work-in-progress. Such costs, principally labor and materials, are
amortized over the shorter of the expected duration of the contracts or the
estimated useful life of the asset.



7.  EMPLOYEE LOANS



    Included in prepaid expenses and other current assets are loans to employees
of $4.5 million (2000: $2.6 million). Included in deposits and non-current
receivables are loans to employees of $0.1 million (2000: $0.4 million).



8.  FIXED ASSETS, NET



    Fixed assets comprise the following:



<Table>
=========================================================================================================
AS OF NOVEMBER 30                                                          2001                   2000
(in thousands)                                                        $       %              $       %
=========================================================================================================
<S>                                                           <C>         <C>        <C>         <C>
Construction support ships                                      715,367      65        711,062      68
---------------------------------------------------------------------------------------------------------
Operating equipment                                             322,339      29        281,816      27
---------------------------------------------------------------------------------------------------------
Land and buildings                                               19,964       2         19,916       2
---------------------------------------------------------------------------------------------------------
Other assets                                                     38,659       4         30,180       3
---------------------------------------------------------------------------------------------------------
                                                              1,096,329     100      1,042,974     100
---------------------------------------------------------------------------------------------------------
Less: Accumulated depreciation and amortization                (316,858)              (239,626)
---------------------------------------------------------------------------------------------------------
                                                                779,471                803,348
=========================================================================================================
</Table>


                                      F-15
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



9.  INVESTMENTS IN AND ADVANCES TO NON-CONSOLIDATED JOINT VENTURES



    Investments in and advances to non-consolidated joint ventures comprise the
following:



<Table>
=================================================================================================
AS OF NOVEMBER 30                                       Geographical              2001       2000
(in thousands)                                          location                     $          $
=================================================================================================
<S>                                                     <C>                   <C>        <C>
NKT Flexibles I/S                                       Denmark                 18,379     23,237
-------------------------------------------------------------------------------------------------
Mar Profundo Girassol                                   West Africa, SEAME       9,580     11,261
-------------------------------------------------------------------------------------------------
Sonamet                                                 West Africa, SEAME     (7,458)    (8,126)
-------------------------------------------------------------------------------------------------
Sonastolt                                               West Africa, SEAME       6,150      5,321
-------------------------------------------------------------------------------------------------
Seaway Heavy Lifting Limited                            Cyprus                   3,191      2,809
-------------------------------------------------------------------------------------------------
Project joint ventures                                  Norway, SEAME            2,555      (190)
-------------------------------------------------------------------------------------------------
Other                                                   Norway, SEAME            3,132      2,692
=================================================================================================
                                                                                35,529     37,004
=================================================================================================
</Table>



    In circumstances where the Company owns more than 50% of the voting
interest, but the Company's ability to control the operation of the investee is
restricted by the significant participating interest held by another party, the
investment is consolidated under the equity method of accounting.



    The Company accrues losses in excess of the investment value when the
Company is committed to provide ongoing financial support to the joint venture.



    Taxation in respect of project joint ventures has been included in the
results of the relevant subsidiaries. Undistributed reserves of all other joint
ventures will not be taxed on distribution.



    Summarized financial information for the Company's non-consolidated joint
ventures, representing 100% of the respective amounts included in the joint
ventures' financial statements, is as follows:



INCOME STATEMENT DATA



<Table>
============================================================================================
FOR THE YEAR ENDED NOVEMBER 30                                   2001       2000       1999
(in thousands)                                                      $          $          $
============================================================================================
<S>                                                           <C>        <C>        <C>
Net operating revenue                                         296,305    357,984    237,516
--------------------------------------------------------------------------------------------
Gross profit                                                   27,599     29,102     14,581
--------------------------------------------------------------------------------------------
Net income                                                     24,329     15,351     13,117
============================================================================================
</Table>



BALANCE SHEET DATA



<Table>
=================================================================================
AS OF NOVEMBER 30                                                2001       2000
(in thousands)                                                      $          $
=================================================================================
<S>                                                           <C>        <C>
Current assets                                                231,402    216,333
---------------------------------------------------------------------------------
Non-current assets                                            104,868    127,073
---------------------------------------------------------------------------------
Current liabilities                                           237,581    247,510
---------------------------------------------------------------------------------
Long-term liabilities                                          38,922     25,269
=================================================================================
</Table>


                                      F-16
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



9.  INVESTMENTS IN AND ADVANCES TO NON-CONSOLIDATED JOINT VENTURES (CONTINUED)


    For commercial reasons, the Company has structured certain contractual
services through its joint ventures. The income statement data for the
non-consolidated joint ventures presented above includes the following expenses
related to transactions with the Company in 2001, 2000 and 1999 respectively:
charter hire of $5.1 million, $4.4 million and $7.2 million and other expenses
of $60.5 million, $34.2 million and $27.9 million. The joint ventures also
received revenue of $39.5 million, $45.0 million and $7.0 million from the
Company. The balance sheet data includes amounts payable to joint ventures by
the Company of $9.7 million and $17.4 million and short-term amounts receivable
by the Company of $61.1 million and $29.8 million at November 30, 2001 and 2000,
respectively.



10.  INCOME TAXES



    The income tax (provision) benefit is as follows:



<Table>
============================================================================================
FOR THE YEAR ENDED NOVEMBER 30                                   2001       2000       1999
(in thousands)                                                      $          $          $
============================================================================================
<S>                                                           <C>        <C>        <C>
Current                                                       (25,052)   (12,953)    (7,159)
--------------------------------------------------------------------------------------------
Deferred                                                        4,433     16,731     15,668
============================================================================================
Income tax (provision) benefit                                (20,619)     3,778      8,509
============================================================================================
</Table>



    The tax effects of temporary differences and net operating loss
carryforwards ("NOLs") at November 30, 2001 and 2000 are as follows:



<Table>
=================================================================================
AS OF NOVEMBER 30                                                2001       2000
(in thousands)                                                      $          $
=================================================================================
<S>                                                           <C>        <C>
Net operating loss carryforwards                               77,128     61,788
---------------------------------------------------------------------------------
Other accruals, net                                            38,118     18,952
---------------------------------------------------------------------------------
Fixed assets                                                  (63,290)   (72,822)
=================================================================================
Net deferred tax before valuation allowance                    51,956      7,918
---------------------------------------------------------------------------------
Valuation allowance                                           (57,142)   (20,956)
=================================================================================
Net deferred tax liability                                     (5,186)   (13,038)
=================================================================================
Short-term deferred tax asset                                   2,622         --
---------------------------------------------------------------------------------
Long-term deferred tax asset                                   10,386     13,705
---------------------------------------------------------------------------------
Deferred tax liability                                        (18,194)   (26,743)
=================================================================================
                                                               (5,186)   (13,038)
=================================================================================
</Table>



    The Company accounts for income taxes in accordance with SFAS No. 109,
"ACCOUNTING FOR INCOME TAXES". SFAS No. 109 requires that the tax benefit of
such NOLs be recorded as an asset to the extent that management assesses the
utilization of such NOLs to be "more likely than not".



    The Company has a net deferred tax asset in the U.S. totalling
$10.8 million. This represents NOLs, net of fixed asset and other timing
differences. These NOLs expire through 2019. Management has decided not to
increase the net deferred tax asset for NOLs at this time and has taken a
valuation allowance against the current year's NOL.


                                      F-17
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



10.  INCOME TAXES (CONTINUED)


    Management has determined that the results of the U.S. businesses have been
severely impacted by the oil and gas prices, which remained low for most of
2001. Management believes, based on the Company's history of operating earnings
prior to this significant market slump and its expectations for the future, that
operating income of the Company will more likely than not be sufficient to fully
realize the $10.8 million net deferred tax asset prior to the expiry of the
NOLs. In determining this, management has considered the fact that there are a
number of bids for larger field development projects coming into the market and
that the margins on local business are expected to recover in 2002 and a
reduction in the intercompany interest burden of the U.S. subsidiaries over the
next few years.



    The Company has taken a valuation allowance against the brought forward
deferred tax asset for NOLs of $1.6 million in Australia and has recognized no
deferred tax benefit against the 2001 results.



    The net deferred tax asset in Norway of $2.2 million represents NOLs.
Management has determined, based on the history of operating earnings and
expectations of the future, that the operating income of the Company will more
likely than not be sufficient to fully realize these net deferred tax assets
prior to the expiry of the NOLs, which expire through to 2011.



    The United Kingdom has unused NOLs, on a tax-effected basis, of
$4.4 million as at November 30, 2001, which may be carried forward indefinitely.



    The Company's United Kingdom shipping subsidiaries have elected to join the
United Kingdom tonnage tax regime, whereby taxable income over the next ten
years will be computed in part by reference to the tonnage of vessels.
Accordingly, the Company has released part of the deferred tax liability arising
on accelerated United Kingdom shipping tax allowances.


                                      F-18
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



10.  INCOME TAXES (CONTINUED)



    The income tax benefit (provision) at the Company's effective tax rate
differs from the income tax benefit (provision) at the statutory rate. Principal
reconciling items include the following:



<Table>
<Caption>
---------------------------------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED NOVEMBER 30, 2001                          U.S.   Scandinavia       U.K.   France(a)      Other          Total
(in thousands)                                                   $             $          $           $          $              $
<S>                                                       <C>        <C>           <C>        <C>         <C>            <C>
=================================================================================================================================
(Loss)/income before income taxes and minority interests  (45,886)       (3,221)      7,333    (21,910)     72,906          9,222
---------------------------------------------------------------------------------------------------------------------------------
Utilization of prior year losses(b)                             --            --         --     (1,957)         --        (1,957)
---------------------------------------------------------------------------------------------------------------------------------
Income subject to withholding taxes                             --            --         --          --   (37,105)       (37,105)
---------------------------------------------------------------------------------------------------------------------------------
Income in non-taxable areas                                     --            --         --          --   (28,776)       (28,776)
---------------------------------------------------------------------------------------------------------------------------------
Losses for which no benefit is recognized                       --            --         --          --     10,568         10,568
=================================================================================================================================
Taxable (loss) income                                     (45,886)       (3,221)      7,333    (23,867)     17,593       (48,048)
---------------------------------------------------------------------------------------------------------------------------------
Statutory tax rate                                             34%           28%        30%         36%        40%(c)         33%
=================================================================================================================================
Tax at statutory rate                                       15,601           902    (2,200)       8,697    (7,036)         15,964
---------------------------------------------------------------------------------------------------------------------------------
Non-deductible amortization                                (1,682)            --      (382)     (2,920)         --        (4,984)
---------------------------------------------------------------------------------------------------------------------------------
Adjustments in respect of prior years                        1,092            --    (3,849)     (3,324)    (5,138)       (11,219)
---------------------------------------------------------------------------------------------------------------------------------
Change in valuation allowance                             (14,679)            --    (3,226)     (5,033)    (8,752)       (31,690)
---------------------------------------------------------------------------------------------------------------------------------
Imputed interest deduction                                      --            --         --          --      5,381          5,381
---------------------------------------------------------------------------------------------------------------------------------
Withholding and other taxes                                     --            --    (1,212)         173    (8,484)        (9,523)
---------------------------------------------------------------------------------------------------------------------------------
Permanent differences                                        (350)           123       (62)          --         --          (289)
---------------------------------------------------------------------------------------------------------------------------------
Change in tax regime                                            --            --     15,200          --         --         15,200
---------------------------------------------------------------------------------------------------------------------------------
Other                                                           18            --         --       (467)        990            541
=================================================================================================================================
Income tax benefit (provision)                                  --         1,025      4,269     (2,874)   (23,039)       (20,619)
=================================================================================================================================
</Table>



<Table>
<Caption>
---------------------------------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED NOVEMBER 30, 2000
(in thousands)
<S>                                                       <C>        <C>           <C>        <C>         <C>            <C>
=================================================================================================================================
(Loss)/income before income taxes and minority interests  (49,992)      (24,935)    (1,708)       5,413     35,522       (35,700)
---------------------------------------------------------------------------------------------------------------------------------
Utilization of prior year losses(b)                             --            --         --    (11,728)      (525)       (12,253)
---------------------------------------------------------------------------------------------------------------------------------
Income subject to withholding taxes                             --            --         --          --   (38,254)       (38,254)
---------------------------------------------------------------------------------------------------------------------------------
Income in non-taxable areas                                     --            --         --          --   (25,360)       (25,360)
---------------------------------------------------------------------------------------------------------------------------------
Losses for which no benefit is recognized                       --         1,905      1,114      13,157     25,560         41,736
=================================================================================================================================
Taxable (loss) income                                     (49,992)      (23,030)      (594)       6,842    (3,057)       (69,831)
---------------------------------------------------------------------------------------------------------------------------------
Statutory tax rate                                             34%           29%        30%         38%        45%(c)         33%
=================================================================================================================================
Tax at statutory rate                                       16,997         6,743        178     (2,584)      1,377         22,711
---------------------------------------------------------------------------------------------------------------------------------
Non-deductible amortization                                (1,734)           (9)      (495)          --      (666)        (2,904)
---------------------------------------------------------------------------------------------------------------------------------
Adjustments in respect of prior years                          872       (1,500)      (758)          --      (900)        (2,286)
---------------------------------------------------------------------------------------------------------------------------------
Change in valuation allowance                             (10,219)            --         --     (1,519)         --       (11,738)
---------------------------------------------------------------------------------------------------------------------------------
Tax credits for research and development                        --            --         --       3,932         --          3,932
---------------------------------------------------------------------------------------------------------------------------------
Imputed interest deduction                                      --            --         --          --      7,379          7,379
---------------------------------------------------------------------------------------------------------------------------------
Withholding and other taxes                                     --            --         --     (2,052)    (9,935)       (11,987)
---------------------------------------------------------------------------------------------------------------------------------
Participation exemption income                                  --            --         --          --    (2,237)        (2,237)
---------------------------------------------------------------------------------------------------------------------------------
Changes in tax rates                                            --            --         --       (176)      (196)          (372)
---------------------------------------------------------------------------------------------------------------------------------
Exchange loss                                                   --            --         --         213        380            593
---------------------------------------------------------------------------------------------------------------------------------
Other                                                           24           115      (249)       (444)      1,241            687
=================================================================================================================================
Income tax benefit (provision)                               5,940         5,349    (1,324)     (2,630)    (3,557)          3,778
=================================================================================================================================
</Table>



(a)  As a consequence of the acquisition of ETPM, taxation in France has become
      more significant and has therefore been separately identified in 2001 and
    2000. In 1999, it was included in "other".



(b)  The reported utilization of prior year losses against current year profits
      represents entities where deferred tax assets had not previously been
    recognized for those losses.



(c)  The statutory tax rate for the "other" category represents a weighted
      average of various local statutory tax rates including certain revenue
    taxes.


                                      F-19
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



10.  INCOME TAXES (CONTINUED)



<Table>
<Caption>
---------------------------------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED NOVEMBER 30                                U.S.   Scandinavia       U.K.   France(a)      Other          Total
(in thousands)                                                   $             $          $           $          $              $
<S>                                                       <C>        <C>           <C>        <C>         <C>            <C>
=================================================================================================================================
(Loss)/income before income taxes and minority interests  (41,085)        18,015      (128)                 30,902          7,704
---------------------------------------------------------------------------------------------------------------------------------
Utilization of prior year losses(b)                             --            --         --               (10,926)       (10,926)
---------------------------------------------------------------------------------------------------------------------------------
Income in non-taxable areas                                     --            --         --                (8,648)        (8,648)
---------------------------------------------------------------------------------------------------------------------------------
Losses for which no benefit is
  recognized                                                    --            --         --                  8,398          8,398
=================================================================================================================================
Taxable (loss) income                                     (41,085)        18,015      (128)                 19,726        (3,472)
---------------------------------------------------------------------------------------------------------------------------------
Statutory tax rate                                             34%           28%        30%                    37%(c)         50%
=================================================================================================================================
Tax at statutory rate                                       13,969       (5,044)         38                (7,221)          1,742
---------------------------------------------------------------------------------------------------------------------------------
Non-deductible amortization                                     --          (51)      (145)                  (329)          (525)
---------------------------------------------------------------------------------------------------------------------------------
Adjustments in respect of prior years                           --            --        750                     --            750
---------------------------------------------------------------------------------------------------------------------------------
State tax credit                                               975            --         --                     --            975
---------------------------------------------------------------------------------------------------------------------------------
Imputed tax deduction                                           --            --         --                  4,030          4,030
---------------------------------------------------------------------------------------------------------------------------------
Change in valuation allowance                                (216)            --    (1,800)                  1,968           (48)
---------------------------------------------------------------------------------------------------------------------------------
Non-taxable dividend income from joint ventures                 --            --         --                    189            189
---------------------------------------------------------------------------------------------------------------------------------
Changes in tax rates                                            --            --      (192)                     --          (192)
---------------------------------------------------------------------------------------------------------------------------------
Exchange loss                                                   --           253        983                    257          1,493
---------------------------------------------------------------------------------------------------------------------------------
Other                                                          210           249      (192)                  (172)             95
=================================================================================================================================
Income tax benefit (provision)                              14,938       (4,593)      (558)                (1,278)          8,509
=================================================================================================================================
</Table>



(a)  As a consequence of the acquisition of ETPM, taxation in France has become
      more significant and has therefore been separately identified in 2001 and
    2000. In 1999, it was included in "other".



(b)  The reported utilization of prior year losses against current year profits
      represents entities where deferred tax assets had not previously been
    recognized for those losses.



(c)  The statutory tax rate for the "other" category represents a weighted
      average of various local statutory tax rates including certain revenue
    taxes.


                                      F-20
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



11.  PENSION COMMITMENTS



    The Company operates both defined contribution and defined benefit pension
plans, depending on location, covering certain qualifying employees.
Contributions under the defined contribution pension plans are determined as a
percentage of gross salary. The expense relative to these plans for the years
ended November 30, 2001, 2000 and 1999 was $1.6 million, $1.1 million and
$1.4 million, respectively.



    The Company operates both funded and unfunded defined benefit pension plans.
The benefits under the defined benefit pension plans are based on years of
service and salary levels. Plan assets of the funded schemes primarily are
comprised of marketable securities.



    The following tables provide a reconciliation of benefit obligation and plan
assets:



<Table>
<Caption>
---------------------------------------------------------------------------------
AS OF NOVEMBER 30                                                 2001       2000
(IN THOUSANDS)                                                       $          $
<S>                                                           <C>        <C>
=================================================================================
CHANGE IN BENEFIT OBLIGATION
---------------------------------------------------------------------------------
Benefit obligation at beginning of year                         18,558     17,742
---------------------------------------------------------------------------------
Service cost                                                     1,735      1,394
---------------------------------------------------------------------------------
Interest cost                                                    1,165      1,010
---------------------------------------------------------------------------------
Actuarial (gains)/losses                                         (266)      1,133
---------------------------------------------------------------------------------
Foreign currency exchange rate changes                             131    (2,295)
---------------------------------------------------------------------------------
Benefits paid from plan assets                                   (423)      (426)
=================================================================================
Benefit obligation at end of year                               20,900     18,558
=================================================================================
CHANGE IN PLAN ASSETS
---------------------------------------------------------------------------------
Fair value of plan assets at beginning of year                  19,155     19,023
---------------------------------------------------------------------------------
Actual return on plan assets                                   (2,198)      1,911
---------------------------------------------------------------------------------
Foreign currency exchange rate changes                             192    (2,407)
---------------------------------------------------------------------------------
Company contributions                                            1,508      1,054
---------------------------------------------------------------------------------
Benefits paid from plan assets                                   (423)      (426)
---------------------------------------------------------------------------------
Plan amendments                                                    240         --
=================================================================================
Fair value of plan assets at end of year                        18,474     19,155
=================================================================================
</Table>



    The following table sets forth the funded status of the funded defined
benefit pension plans:



<Table>
<Caption>
---------------------------------------------------------------------------------
                                                                 Pension benefits
FOR THE YEAR ENDED NOVEMBER 30                                    2001       2000
(IN THOUSANDS)                                                       $          $
<S>                                                           <C>        <C>
=================================================================================
Funded status of the plans                                     (2,426)        597
---------------------------------------------------------------------------------
Unrecognized net gain                                            5,936      2,693
---------------------------------------------------------------------------------
Unrecognized prior service benefit                                 259        287
---------------------------------------------------------------------------------
Unrecognized net transition obligation                           (287)      (316)
=================================================================================
Prepaid benefit cost                                             3,482      3,261
=================================================================================
</Table>


                                      F-21
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



11.  PENSION COMMITMENTS (CONTINUED)


    The weighted average assumptions used are as follows:



<Table>
<Caption>
--------------------------------------------------------------------------------------------
                                                                            Pension benefits
                                                                  2001       2000       1999
FOR THE YEAR ENDED NOVEMBER 30                                       %          %          %
<S>                                                           <C>        <C>        <C>
============================================================================================
Discount rate                                                   6.2        6.1        6.1
--------------------------------------------------------------------------------------------
Expected return on plan assets                                  7.0        7.0        7.1
--------------------------------------------------------------------------------------------
Rate of compensation increase                                   3.2        3.3        3.3
--------------------------------------------------------------------------------------------
</Table>



    Net periodic pension benefit costs for funded defined benefit schemes
include the following components:



<Table>
<Caption>
--------------------------------------------------------------------------------------------
                                                                            Pension benefits
FOR THE YEAR ENDED NOVEMBER 30                                    2001       2000       1999
(IN THOUSANDS)                                                       $          $          $
<S>                                                           <C>        <C>        <C>
============================================================================================
Service cost                                                     1,735      1,394      1,426
--------------------------------------------------------------------------------------------
Interest cost                                                    1,165      1,010      1,040
--------------------------------------------------------------------------------------------
Expected return on plan assets                                 (1,308)    (1,287)    (1,251)
--------------------------------------------------------------------------------------------
Amortization of transition obligation                             (41)         92       (47)
--------------------------------------------------------------------------------------------
Recognized net actuarial losses                                     38         38        155
--------------------------------------------------------------------------------------------
Amortization of prior service benefit                               86       (41)         44
============================================================================================
Benefit cost                                                     1,675      1,206      1,367
============================================================================================
</Table>



    As at November 30, 2001, all of the Company's funded pension plans had
benefit obligations in excess of plan assets. As at November 30, 2000, the
Company had funded pension plans which had benefit obligations in excess of plan
assets. The benefit obligations of these plans were $6.9 million and the value
of assets under these plans were $6.2 million.



    The following tables provide a reconciliation of the benefit obligation and
accrued pension liability of the unfunded plan.



<Table>
<Caption>
---------------------------------------------------------------------------------
                                                                 Pension benefits
FOR THE YEAR ENDED NOVEMBER 30                                    2001       2000
(IN THOUSANDS)                                                       $          $
<S>                                                           <C>        <C>
=================================================================================
Benefit obligation at beginning of year                          3,797         --
---------------------------------------------------------------------------------
Acquisitions                                                       612      3,642
---------------------------------------------------------------------------------
Service cost                                                       301        277
---------------------------------------------------------------------------------
Interest cost                                                      223        213
---------------------------------------------------------------------------------
Benefits paid from plan assets                                      --       (85)
---------------------------------------------------------------------------------
Foreign currency exchange rate changes                              59      (250)
=================================================================================
Benefit obligation at end of year                                4,992      3,797
=================================================================================
</Table>


                                      F-22
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



11.  PENSION COMMITMENTS (CONTINUED)


    As the plan is unfunded, the benefit obligation is equal to the unfunded
status of the plan and the accrued pension liability.



    The weighted average assumptions used are as follows:



<Table>
<Caption>
---------------------------------------------------------------------------------
                                                                 Pension benefits
                                                                  2001       2000
FOR THE YEAR ENDED NOVEMBER 30                                       %          %
<S>                                                           <C>        <C>
=================================================================================
Discount rate                                                   6.2        5.5
---------------------------------------------------------------------------------
Expected return on plan assets                                  N/A        N/A
---------------------------------------------------------------------------------
Rate of compensation increase                                   3.0        3.5
=================================================================================
</Table>



    Net periodic pension benefit costs include the following components:



<Table>
<Caption>
---------------------------------------------------------------------------------
                                                                 Pension benefits
FOR THE YEAR ENDED NOVEMBER 30                                    2001       2000
(IN THOUSANDS)                                                       $          $
<S>                                                           <C>        <C>
=================================================================================
Service cost                                                    301        277
---------------------------------------------------------------------------------
Interest cost                                                   223        213
=================================================================================
Benefit cost                                                    524        490
=================================================================================
</Table>



    In Asia Pacific, retirement indemnities, for which the Company has accrued
$0.3 million at November 30, 2001 (2000: $0.3 million) are paid as a lump sum
upon retirement. They are primarily based upon the employees' years of service
and salary levels.



12.  BANK OVERDRAFT AND LINES OF SHORT-TERM CREDIT



    As of November 30, 2001, the Company has external, third-party bank
overdraft and lines of credit and short-term loan notes totalling $45.9 million
(2000: $38.3 million). Amounts borrowed pursuant to these facilities bear
interest at rates ranging from 4.22% to 6.75% at November 30, 2001. As of
November 30, 2001 short-term borrowings under these facilities totalled
$5.2 million (2000: $1.8 million).



13.  LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS



    The Company's principal credit facility is a $440.0 million Secured
Multi-Currency Revolving Facility (the "Secured Credit Facility") with a
syndicate of banks, the lead banks being Den norske Bank ASA, Banc of America
Securities LLC, Salomon Brothers International Limited, HSBC Bank plc and ING
Barings LLC. The Secured Credit Facility was entered into on September 22, 2000.



    The Secured Credit Facility is a five-year revolving credit facility, which
reduces to $385.0 million and $330.0 million on August 31, 2002 and August 31,
2003, respectively. The total amount which can be drawn under the facility and
the interest charge on outstanding debt is based on the ratio of the Company's
debt to earnings before interest, taxes, depreciation and amortization
("EBITDA"). The interest charge will range from 0.75% to 1.75% over the London
InterBank Offer Rate ("LIBOR").


                                      F-23
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



13.  LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS (CONTINUED)


Debt under the Secured Credit Facility is secured by a first priority mortgage
on certain of the Company's ships.



    Under the Secured Credit Facility agreement, the Company is permitted to
borrow up to $100.0 million from SNSA provided that this debt is subordinate and
junior to all indebtedness due under the agreement.



    As of November 30, 2001, the Company had available bank facilities of
$485.9 million of which $340.2 million were utilized. Of the bank facilities
utilized, $335.0 million was classified as long-term debt.



    Long-term debt, excluding borrowings from SNSA, comprises the following:



<Table>
<Caption>
---------------------------------------------------------------------------------
AS OF NOVEMBER 30                                                 2001       2000
(IN THOUSANDS)                                                       $          $
<S>                                                           <C>        <C>
=================================================================================
Revolving credit agreement with a weighted average interest
  rate of 3.82% (2000: 8.31%)                                  335,000    265,000
---------------------------------------------------------------------------------
Other bank borrowings                                               17         32
=================================================================================
                                                               335,017    265,032
---------------------------------------------------------------------------------
Less: current portion                                             (17)       (16)
=================================================================================
Long-term debt                                                 335,000    265,016
=================================================================================
</Table>



    The net book value of assets collateralizing this debt was $365.3 million as
of November 30, 2001.



    Total debt outstanding at November 30, 2001 is repayable as $335.0 million
in U.S. Dollars.



    Minimum annual principal repayments of debt for the fiscal years subsequent
to November 30, 2001 are as follows:



<Table>
<Caption>
----------------------------------------------------------------------
(in thousands)                                                       $
<S>                                                           <C>
======================================================================
2002                                                               17
----------------------------------------------------------------------
2003                                                            5,000
----------------------------------------------------------------------
2005                                                          330,000
======================================================================
                                                              335,017
======================================================================
</Table>



    The Secured Credit Facility contains various financial covenants, including
but not limited to, minimum consolidated tangible net worth, maximum
consolidated debt to net worth and maximum consolidated debt to EBITDA.



    At November 30, 2001, property under capital leases, comprising operating
and other equipment, amounts to $31.9 million, at cost. Accumulated amortization
of these leases is $3.5 million.


                                      F-24
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



13.  LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS (CONTINUED)


    Minimum payments under capital leases at November 30, 2001, which are due
primarily in U.S. Dollars, are as follows:



<Table>
<Caption>
----------------------------------------------------------------------
(in thousands)                                                       $
<S>                                                           <C>
======================================================================
2002                                                            25,051
----------------------------------------------------------------------
2003                                                                20
----------------------------------------------------------------------
2004 to 2006                                                         7
======================================================================
Total minimum lease payments                                    25,078
----------------------------------------------------------------------
Less: Amount representing interest and executory costs         (1,416)
======================================================================
Present value of net minimum lease payments                     23,662
======================================================================
</Table>



14.  ACCOUNTS PAYABLE AND ACCRUED LIABILITIES



    Accounts payable and accrued liabilities comprise the following:



<Table>
<Caption>
---------------------------------------------------------------------------------
AS OF NOVEMBER 30                                                 2001       2000
(IN THOUSANDS)                                                       $          $
<S>                                                           <C>        <C>
=================================================================================
Invoice accruals                                              230,243    154,758
---------------------------------------------------------------------------------
Trade payables                                                108,750     97,418
---------------------------------------------------------------------------------
Trade notes payable                                               151        790
---------------------------------------------------------------------------------
Other                                                          10,296      2,658
=================================================================================
                                                              349,440    255,624
=================================================================================
</Table>



15.  RELATED PARTY TRANSACTIONS



    Related party transactions consisted of the following charges paid to SNSA:



<Table>
<Caption>
--------------------------------------------------------------------------------------------
FOR THE YEAR ENDED NOVEMBER 30                                    2001       2000       1999
(IN THOUSANDS)                                                       $          $          $
<S>                                                           <C>        <C>        <C>
--------------------------------------------------------------------------------------------
Management services                                            3,676      3,290       2,500
--------------------------------------------------------------------------------------------
Interest charges                                                 394      3,561      10,412
--------------------------------------------------------------------------------------------
Guarantee fees                                                    --        282          --
============================================================================================
</Table>



    Management services comprise charges for legal, administrative, treasury,
taxation, insurance and information technology services performed by SNSA for
the Company.



    Short-term payables due to SNSA of $9.5 million as of November 30, 2001
(2000: $8.5 million) relate primarily to outstanding insurance premiums and
management service charges.


                                      F-25
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



16.  RESTRUCTURING AND REORGANIZATION PROGRAM



    In 2000, in relation to the integration of ETPM, the Company recorded
restructuring charges of $3.3 million. Additionally, the Company capitalized
costs of $1.0 million, net of tax, as an adjustment to the purchase price of
ETPM.



    The costs are summarized in the table below.



<Table>
<Caption>
------------------------------------------------------------------------------------------------
                                                               Expensed
                                                                  (non-
FOR THE YEAR ENDED                                            recurring
NOVEMBER 30, 2000                                                items)   Capitalized      Total
(in thousands)                                                        $             $          $
<S>                                                           <C>         <C>           <C>
================================================================================================
Redundancy costs                                                 2,610             --    2,610
------------------------------------------------------------------------------------------------
Lease costs, net of tax of $0.4 million                             --            961      961
------------------------------------------------------------------------------------------------
Integration costs                                                  684             --      684
================================================================================================
Total                                                            3,294            961    4,255
================================================================================================
</Table>



    The reorganization program removed duplicate capacity in the U.K. and SEAME
regions. The Company recorded redundancy costs of $0.9 million to close the
former ETPM sites in the United Kingdom and transfer all administrative and
operational functions to the Company's office in Aberdeen, Scotland and
$1.7 million to close its office in Marseille, France and transfer all
operational and administrative functions for the SEAME region to Paris, France.
The costs associated with leasing and maintaining the U.K. premises while vacant
and, subsequently terminating the leases, amounted to $1.0 million. The lease
costs were capitalized as an adjustment to the purchase price of ETPM.
Additionally, integration costs of $0.7 million were incurred to introduce
common information and reporting systems and to standardize processes. All
redundancy, integration and lease costs have been fully paid, and there is no
outstanding provision for such costs at November 30, 2001.



    During 1999, the Company carried out a reorganization of its North Sea
operations and closed offices in the United Kingdom and Norway. Non-recurring
costs amounting to $1.6 million were expensed, of which $1.3 million related to
redundancy and relocation costs and $0.3 million related to other administrative
costs. All costs relating to this reorganization were paid out during 1999 and
2000, and there is no outstanding provision for such costs at November 30, 2001.



17.  OPERATING LEASES



    Total operating lease commitments as of November 30, 2001 amount to
$103.6 million. Charter hire obligations towards certain construction support,
diving support, survey and inspection ships account for $53.9 million of the
total commitments. The remaining obligations relate to office facilities and
equipment.


                                      F-26
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



17.  OPERATING LEASES (CONTINUED)


    Total minimum annual lease commitments are payable as follows:



<Table>
<Caption>
----------------------------------------------------------------------
(in thousands)                                                       $
<S>                                                           <C>
======================================================================
2002                                                           25,803
----------------------------------------------------------------------
2003                                                           22,874
----------------------------------------------------------------------
2004                                                           15,505
----------------------------------------------------------------------
2005                                                           13,809
----------------------------------------------------------------------
2006                                                           11,263
----------------------------------------------------------------------
Thereafter                                                     14,299
======================================================================
                                                              103,553
======================================================================
</Table>



<Table>
<Caption>
(in thousands)                                                       $
<S>                                                           <C>
======================================================================
Norwegian Kroner                                               47,124
----------------------------------------------------------------------
Euros                                                          33,168
----------------------------------------------------------------------
U.S. Dollars                                                   15,920
----------------------------------------------------------------------
British Pounds                                                  6,633
----------------------------------------------------------------------
Singapore Dollars                                                 488
----------------------------------------------------------------------
Australian Dollars                                                220
======================================================================
                                                              103,553
======================================================================
</Table>



    Total operating lease rentals charged as an expense for the year ended
November 30, 2001 were $21.4 million (2000: $23.2 million and 1999:
$28.1 million).



    Future minimum lease payments have not been reduced by future minimum
sublease rentals of $3.7 million under operating leases.



18.  SEGMENT AND RELATED INFORMATION



    In 1999, the Company adopted SFAS No. 131, "DISCLOSURES ABOUT SEGMENTS OF AN
ENTERPRISE AND RELATED INFORMATION" which changed the way the Company reported
information about its operating segments.



    The Company has reportable segments based on the geographic distribution of
the activities as follows: the Asia Pacific reporting segment includes all
activities east of the Indian sub-continent including Australasia; the North
America reporting segment includes all activity in Canada, the U.S. and Central
America; the Norway reporting segment includes all activities in Scandinavia and
the Baltic states; the SEAME reporting segment covers activities in Southern
Europe and Africa, India and the Middle East; the South America reporting
segment incorporates activities in South America and the islands of the southern
Atlantic Ocean; and the United Kingdom reporting segment includes activities in
the United Kingdom, Ireland, Germany, Belgium, The Netherlands and islands in
the northern Atlantic Ocean. The Corporate reporting segment includes items that
cannot be allocated to one particular region. This reporting segment includes
activities of the SHL and NKT joint ventures; Serimer DASA, a contract welding
services entity employed both onshore and offshore by pipelay


                                      F-27
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



18.  SEGMENT AND RELATED INFORMATION (CONTINUED)


contractors; Paragon and Litwin, which both provide engineering services for the
offshore oil and gas industry. Also included in Corporate are assets which have
global mobility including construction support ships and ROVs; other assets that
are used globally and therefore cannot be attributed to any one reporting
segment; and management and corporate services provided for the benefit of the
whole group, including engineering, finance and legal departments.



    The accounting policies of the reporting segments are the same as those
described in Note 2. The segmental information is presented after the
elimination of intercompany balances between the reportable segments. For the
years ended November 30, 2000 and 1999, inter segment sales and transfers are
not significant. For the year ended November 30, 2001, Corporate shows a
significant increase in net operating revenue. This revenue arises from Paragon
and Litwin, which were acquired during 2001.



    Summarized financial information concerning each of the Company's reportable
segments is provided in the following tables:



<Table>
<Caption>
---------------------------------------------------------------------------------------------------------------------------------
                                           Asia       North                             South
FOR THE YEAR ENDED NOVEMBER 30, 2001    Pacific     America     Norway      SEAME     America       U.K.    Corporate       Total
(in thousands)                                $           $          $          $           $          $            $           $
<S>                                    <C>        <C>         <C>        <C>        <C>         <C>        <C>          <C>
=================================================================================================================================
Net operating revenue--external          39,437     276,681    110,631    520,207      50,472    214,721       43,789   1,255,938
---------------------------------------------------------------------------------------------------------------------------------
Net operating revenue--internal(a)        4,255      78,970     36,768     78,311      12,674     53,080        4,567          --
---------------------------------------------------------------------------------------------------------------------------------
Equity in net income of
  non-consolidated joint ventures            --          --      5,798     10,902          --         --      (5,045)      11,655
---------------------------------------------------------------------------------------------------------------------------------
Depreciation and amortization           (2,015)    (21,546)    (1,074)    (5,984)     (6,003)    (1,480)     (53,648)    (91,750)
---------------------------------------------------------------------------------------------------------------------------------
Impairment of Comex trade name               --          --         --         --          --         --      (7,932)     (7,932)
---------------------------------------------------------------------------------------------------------------------------------
Research and development expense             --          --         --         --          --         --        (393)       (393)
---------------------------------------------------------------------------------------------------------------------------------
Interest expense                          (421)     (2,942)      (118)    (2,891)     (2,285)      (458)     (20,156)    (29,271)
---------------------------------------------------------------------------------------------------------------------------------
Interest income                              --          --         --         --          --         --        2,451       2,451
---------------------------------------------------------------------------------------------------------------------------------
Income tax (expense) benefit            (3,242)          --      1,025   (19,672)          --      4,269      (2,999)    (20,619)
---------------------------------------------------------------------------------------------------------------------------------
Net (loss) income                       (3,238)    (36,191)     12,746      4,857       5,494      5,554      (3,425)    (14,203)
---------------------------------------------------------------------------------------------------------------------------------
Segment assets                           37,449     325,613     55,475    294,267      87,517     81,050      678,892   1,560,263
---------------------------------------------------------------------------------------------------------------------------------
Long-lived assets(b)                     14,328      70,244     12,839     64,875      62,092     13,073      613,741     851,192
---------------------------------------------------------------------------------------------------------------------------------
Investments in and advances to
  non-consolidated joint ventures            --          --      5,684      7,865          --         --       21,980      35,529
---------------------------------------------------------------------------------------------------------------------------------
Capital expenditures                        270       1,789        430      4,060      18,824         --       37,495      62,868
=================================================================================================================================
</Table>



<Table>
<Caption>
---------------------------------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED NOVEMBER 30, 2000
(in thousands)
<S>                                    <C>        <C>         <C>        <C>        <C>         <C>        <C>          <C>
=================================================================================================================================
Net operating revenue                    40,507     122,314    198,779    444,877      52,836    123,607          500     983,420
=================================================================================================================================
Equity in net income of
  non-consolidated joint ventures            --          --      1,019      9,427          --         --      (4,653)       5,793
---------------------------------------------------------------------------------------------------------------------------------
Depreciation and amortization           (2,591)    (21,717)    (1,102)    (4,770)     (5,972)    (3,620)     (42,345)    (82,117)
---------------------------------------------------------------------------------------------------------------------------------
Research and development expense             --          --         --         --          --         --        (950)       (950)
---------------------------------------------------------------------------------------------------------------------------------
Restructuring charge                         --          --         --    (1,793)          --    (1,501)           --     (3,294)
---------------------------------------------------------------------------------------------------------------------------------
Interest expense                          (642)     (5,225)      (626)    (1,503)     (2,206)    (1,199)     (20,756)    (32,157)
---------------------------------------------------------------------------------------------------------------------------------
Interest income                              --          --         --         --          --         --        2,165       2,165
---------------------------------------------------------------------------------------------------------------------------------
Income tax (expense) benefit              (104)       5,940      3,662   (10,867)       (340)      3,483        2,004       3,778
---------------------------------------------------------------------------------------------------------------------------------
Net (loss) income                      (15,020)    (15,285)      6,719      9,242       8,081    (5,724)     (22,456)    (34,443)
---------------------------------------------------------------------------------------------------------------------------------
Segment assets                           32,974     268,663     62,301    253,625      77,559     97,316      610,334   1,402,772
---------------------------------------------------------------------------------------------------------------------------------
Long-lived assets(b)                     16,450      88,924      6,527     73,127      66,207     26,786      586,554     864,575
---------------------------------------------------------------------------------------------------------------------------------
Investments in and advances to
  non-consolidated joint ventures            --          --      2,470      8,488          --         --       26,046      37,004
---------------------------------------------------------------------------------------------------------------------------------
Capital expenditures                        438       3,107        337      3,769      20,307          9       33,757      61,724
=================================================================================================================================
</Table>



(a)  Internal revenues are eliminated on consolidation of the Company's results
      and are therefore shown in the table to equal to zero.



(b)  Long-lived assets include net fixed assets, investments in and advances to
      non-consolidated joint ventures and deposits and non-current receivables.


                                      F-28
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



18.  SEGMENT AND RELATED INFORMATION (CONTINUED)



<Table>
<Caption>
---------------------------------------------------------------------------------------------------------------------------------
                                            Asia       North                             South
FOR THE YEAR ENDED NOVEMBER 30, 1999     Pacific     America     Norway      SEAME     America       U.K.    Corporate      Total
(in thousands)                                 $           $          $          $           $          $            $          $
<S>                                     <C>        <C>         <C>        <C>        <C>         <C>        <C>          <C>
=================================================================================================================================
Net operating revenue                     42,715     156,399    164,539     57,114      56,355    162,032        1,572    640,726
---------------------------------------------------------------------------------------------------------------------------------
Equity in net income of
  non-consolidated joint ventures             --          --      3,526      1,145          --         --          526      5,197
---------------------------------------------------------------------------------------------------------------------------------
Depreciation and amortization            (2,417)    (24,127)    (2,476)    (1,413)     (5,244)    (2,149)     (18,310)   (56,136)
---------------------------------------------------------------------------------------------------------------------------------
Research and development expense              --          --         --         --          --         --      (1,162)    (1,162)
---------------------------------------------------------------------------------------------------------------------------------
Restructuring charge                          --          --    (1,261)         --          --      (378)           --    (1,639)
---------------------------------------------------------------------------------------------------------------------------------
Interest expense                           (455)     (3,948)    (1,845)      (555)       (987)    (1,711)      (8,191)   (17,692)
---------------------------------------------------------------------------------------------------------------------------------
Interest income                               --          --         --         --          --         --          966        966
---------------------------------------------------------------------------------------------------------------------------------
Income tax benefit (expense)                 465      14,609    (4,593)        530          --    (2,803)          301      8,509
---------------------------------------------------------------------------------------------------------------------------------
Net (loss) income                        (4,548)       8,521     11,190      3,928       8,776    (2,283)      (9,371)     16,213
---------------------------------------------------------------------------------------------------------------------------------
Capital expenditures                       3,704       9,030        913        380      14,661      1,818       60,412     90,918
=================================================================================================================================
</Table>



(a) Internal revenues are eliminated on consolidation of the Company's results
    and are therefore shown in the table to equal to zero.



(b) Long-lived assets include net fixed assets, investments in and advances to
    non-consolidated joint ventures and deposits and non-current receivables.



    Revenue Analysis by Product Line:



<Table>
=============================================================================================
FOR THE YEAR ENDED NOVEMBER 30,
(in thousands)                                                     2001      2000       1999
=============================================================================================
<S>                                                           <C>         <C>        <C>
Regional Business                                               314,191   285,152    336,523
---------------------------------------------------------------------------------------------
Subsea Construction                                             279,482   267,071    160,950
---------------------------------------------------------------------------------------------
Pipelay & EPIC(a)                                               337,765   213,744          0
---------------------------------------------------------------------------------------------
Deepwater Development(b)                                        280,712   199,958    141,681
---------------------------------------------------------------------------------------------
Standalone Businesses(c)                                         43,788    17,495      1,570
---------------------------------------------------------------------------------------------
Total Revenue                                                 1,255,938   983,420    640,654
=============================================================================================
</Table>



(a)  This product line did not exist until 2000.



(b)  This product line was called Field Development in 1999.



(c)  This relates to Serimer DASA Paragon Engineering and other.


                                      F-29
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



18.  SEGMENT AND RELATED INFORMATION (CONTINUED)



    During the year ended November 30, 2001, two customers of the Company each
individually accounted for more than 10% of the Company's revenue. The revenue
from the largest customer was $269.2 million and was attributable to the SEAME
reporting segment (2000: $198.2 million attributable to the Norway, SEAME, U.K.
and North America reporting segments). The revenue from the second customer was
$131.5 million and was attributable to the North America reporting segment.



    During the year ended November 30, 2000, in addition to the largest customer
described in the comparative information above, another customer accounted for
more than 10% of the Company's revenue. The revenue from this customer was
$99.3 million and was attributable to the Asia Pacific, Norway, SEAME, U.K. and
North America reporting segments.



    During the year ended November 30, 1999, one customer accounted for more
than 10% of the Company's revenue. Revenue from this customer was $76.5 million
and was attributable to the Norway reporting segment.



19.  COMMON SHARES, CLASS A SHARES AND CLASS B SHARES



    The Company has authorized share capital of 140,000,000 Common Shares, par
value $2.00 per share, and 34,000,000 Class B Shares, par value $2.00 per share.
Class B Shares are convertible into Common Shares, on a two-for-one basis, at
any time at the option of the Class B shareholders.



    On March 7, 2001, the Company reorganized the share structure of the Company
by increasing the authorized share capital of the Company from 102,000,000 to
140,000,000 Common Shares and reclassifying all outstanding Class A Shares to
Common Shares on a one-for-one basis.



    On February 4, 2000, the Company issued 6,142,857 Class A Shares, which have
subsequently been reclassified to Common Shares on a one-for-one basis, as
partial consideration for its acquisition of the French offshore construction
and engineering company ETPM as described in Note 3.



    During 2000, the Company, through a series of transactions, issued
19,775,223 Class A Shares, which have subsequently been reclassified to Common
Shares on a one-for-one basis, to SNSA for cash of $200.0 million.



    On December 7, 1999, the Company issued 1,758,242 Class A Shares, which have
subsequently been reclassified to Common Shares on a one-for-one basis, as
partial consideration for its acquisition of the 49% interest in NKT as
described in Note 3.



    As of November 30, 2001, 70,228,536 Common Shares and 34,000,000 Class B
Shares were outstanding. SNSA holds 42% of the Common Shares and 100% of the
Class B Shares which represents an economic interest of 53% of the Company and
61% of the voting rights.



    Common Shares and Class B Shares vote as a single class on all matters
submitted to a vote of shareholders, with each share entitled to one vote, with
the exception of recapitalization, reclassification or similar transactions
affecting the relative rights, preferences and priorities of the Common Shares
and Class B Shares, which require an affirmative vote of the holders of a
majority of the outstanding Common Shares and Class B Shares each voting as a
separate class. With respect to liquidation and dividend rights, the Class B
Shares receive $0.005 per share for each $0.01 per Common Share.



    Luxembourg law requires that 5% of the Company's unconsolidated net profits
each year be allocated to a legal reserve before declaration of dividends. This
requirement continues until the


                                      F-30
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



19.  COMMON SHARES, CLASS A SHARES AND CLASS B SHARES (CONTINUED)


reserve is 10% of the stated capital of the Company, as represented by Common
Shares and Class B Shares, after which no further allocations are required until
further issuance of shares.



    The legal reserve may also be satisfied by allocation of the required amount
at the issuance of shares or by a transfer from paid-in surplus. The legal
reserve is not available for dividends. The legal reserve for all outstanding
Common Shares and Class B Shares has been satisfied and appropriate allocations
are made to the legal reserve account at the time of each issuance of new
shares.



    No portion of retained earnings represents undistributed earnings of
non-consolidated joint ventures at November 30, 2001 or 2000.



20.  SHARE OPTION PLAN



    On April 28, 1993 the Company adopted a share option plan ("the Plan")
covering 7.7 million shares represented by Common Shares, Class A Shares or any
combination thereof not exceeding 7.7 million. Since March 7, 2001, all Class A
Share options, when exercised, are automatically converted into Common Shares.



    The Company accounts for awards granted to directors and key employees under
APB Opinion No. 25, under which no compensation cost has been recognized. Had
compensation cost for all share option grants in fiscal years 2001, 2000 and
1999 been determined consistent with SFAS No. 123, the Company's net (loss)
income and net (loss) income per share would be changed to the following pro
forma amounts:



<Table>
============================================================================================
FOR THE YEAR ENDED NOVEMBER 30                                   2001       2000       1999
(in thousands, except per share data)                               $          $          $
============================================================================================
<S>                                                           <C>        <C>        <C>
Net (loss) income                                             (14,203)   (34,443)    16,213
--------------------------------------------------------------------------------------------
Net (loss) income pro forma                                   (17,944)   (37,633)    13,644
--------------------------------------------------------------------------------------------
(LOSS) INCOME PER SHARE, AS REPORTED
--------------------------------------------------------------------------------------------
Basic                                                           (0.16)     (0.44)      0.27
--------------------------------------------------------------------------------------------
Diluted                                                         (0.16)     (0.44)      0.27
--------------------------------------------------------------------------------------------
(LOSS) INCOME PER SHARE PRO FORMA
--------------------------------------------------------------------------------------------
Basic                                                           (0.21)     (0.48)      0.23
--------------------------------------------------------------------------------------------
Diluted                                                         (0.21)     (0.48)      0.23
============================================================================================
</Table>



    Options may be granted under the Plan which are exercisable during periods
of up to ten years. The options granted under the Plan will be at an exercise
price not less than the fair market value per share at the time the option is
granted. Options vest 25% on the first anniversary of the grant date, with an
additional 25% vesting on each subsequent anniversary. A Compensation Committee
appointed by the Company's Board of Directors administers the Plan. Options are
awarded at the discretion of the Company to Directors and key employees.


                                      F-31
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



20.  SHARE OPTION PLAN (CONTINUED)


    The following tables reflect activity under the Plan for the three-year
period ended November 30, 2001:



<Table>
<Caption>
--------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED NOVEMBER 30                          2001                  2000                  1999
--------------------------------------------------------------------------------------------------------
                                                    WEIGHTED              Weighted              Weighted
                                                     AVERAGE               average               average
                                                    EXERCISE              exercise              exercise
                                                       PRICE                 price                 price
                                             SHARES        $      SHARES         $      SHARES         $
<S>                                       <C>       <C>        <C>       <C>         <C>       <C>
========================================================================================================
Outstanding at beginning of year          2,533,249    10.00   2,088,736     9.44    1,971,304     8.94
--------------------------------------------------------------------------------------------------------
Granted                                     640,300    13.43     880,949    10.34      365,304    10.49
--------------------------------------------------------------------------------------------------------
Exercised                                   (75,612)     6.98   (309,237)     6.14    (121,901)     4.71
--------------------------------------------------------------------------------------------------------
Forfeited                                   (73,527)    11.15   (127,199)    11.63    (125,971)    10.32
========================================================================================================
Outstanding at end of year                3,024,410    10.77   2,533,249    10.00    2,088,736     9.44
========================================================================================================
Exercisable at end of year                1,477,306     9.65   1,037,466     8.99      971,944     7.72
========================================================================================================
Weighted average fair value of options
  granted                                              10.36                 7.43                  8.12
========================================================================================================
</Table>



    All share data and per share data has been restated to reflect the share
reclassification on March 7, 2001 whereby Class A Shares were reclassified to
Common Shares on a one-for-one basis.



    The fair value of each share option grant is estimated as of the date of
grant using the Black Scholes option pricing model with the following weighted
average assumptions:



<Table>
============================================================================================
                                                                 2001       2000       1999
============================================================================================
<S>                                                           <C>        <C>        <C>
Risk free interest rates                                        5.62%      6.55%      5.82%
--------------------------------------------------------------------------------------------
Expected lives                                                7 YEARS    7 years    7 years
--------------------------------------------------------------------------------------------
Expected volatility                                             81.0%      70.2%      88.0%
--------------------------------------------------------------------------------------------
Expected dividend yields                                           --         --         --
============================================================================================
</Table>


                                      F-32
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



20.  SHARE OPTION PLAN (CONTINUED)


    The following tables summarize information about share options outstanding
as of November 30, 2001:



<Table>
<Caption>
----------------------------------------------------------------------------------------------------
AS OF NOVEMBER 30, 2001                      Options outstanding                 Options exercisable
----------------------------------------------------------------------------------------------------
                                                        Weighted   Weighted                 Weighted
                                                         average    average                  average
                                                       remaining   exercise                 exercise
                                          Options    contractual      price        Number      price
Range of exercise price               outstanding   life (years)          $   exercisable          $
<S>                                   <C>           <C>            <C>        <C>           <C>
====================================================================================================
COMMON SHARES
----------------------------------------------------------------------------------------------------
$13.56 - 16.58                           800,300           8.79       14.25       137,625      16.58
----------------------------------------------------------------------------------------------------
$ 7.82 - 11.12                            13,000           9.73        9.81            --         --
----------------------------------------------------------------------------------------------------
$ 5.17 -  7.38                           121,830           4.95        5.74       121,830       5.74
----------------------------------------------------------------------------------------------------
$ 2.71 -  3.00                           111,750           3.77        2.77       111,750       2.77
====================================================================================================
                                       1,046,880           7.82       11.98       371,205       8.87
====================================================================================================
CLASS A SHARES
----------------------------------------------------------------------------------------------------
$12.13 - 16.58                           106,250           6.72       16.18        74,938      16.44
----------------------------------------------------------------------------------------------------
$ 7.82 - 11.13                         1,115,187           8.16       10.21       353,234      10.19
----------------------------------------------------------------------------------------------------
$ 5.17 -  7.38                            61,290           4.95        5.74        61,290       5.74
----------------------------------------------------------------------------------------------------
$ 2.71 -  3.00                            52,125           3.80        2.77        52,125       2.77
====================================================================================================
                                       1,334,852           7.73       10.19       541,587       9.83
====================================================================================================
</Table>



    As part of the acquisition of the former Ceanic Corporation in 1998, holders
of Ceanic share options were entitled to exercise all vested and one-third of
the unvested options, or to convert any portion thereof to vested Stolt Offshore
S.A. Common Share options. Their remaining two-thirds unvested Ceanic share
options were automatically converted to unvested Stolt Offshore S.A. Common
Share options at the date of acquisition. The following table summarizes
information about these options which are outstanding as at November 30, 2001:



<Table>
<Caption>
----------------------------------------------------------------------------------------------------
                                             Options outstanding               Options exercisable
----------------------------------------------------------------------------------------------------
                                                        Weighted   Weighted                 Weighted
                                                         average    average                  average
                                                       remaining   exercise                 exercise
                                          Options    contractual      price        Number      price
Range of exercise price               outstanding   life (years)          $   exercisable          $
<S>                                   <C>           <C>            <C>        <C>           <C>
====================================================================================================
COMMON SHARES
----------------------------------------------------------------------------------------------------
$7.82 - 11.20                            530,149           5.93       10.75       464,541      10.76
----------------------------------------------------------------------------------------------------
$5.21 -  7.38                            112,529           5.50        6.42        99,973       6.43
====================================================================================================
                                         642,678           5.85        9.99       564,514       9.99
====================================================================================================
</Table>


                                      F-33
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



21.  PROFIT SHARING PLAN



    During 1993 the Company adopted a profit sharing plan which distributes 10%
of the Company's net income after specified adjustments, to certain of its
employees worldwide. The determination of an employee's individual award will be
based on salary and overall contribution to the Company. The Compensation
Committee appointed by the Company's Board of Directors administers this plan.
No charge in respect of profit sharing has been included in the statement of
operations for each of the years ended November 30, 2001, 2000 and 1999.



22.  COMMITMENTS AND CONTINGENCIES



    The Company has issued performance bonds amounting to $418 million at
November 30, 2001. In the normal course of business, the Company provides
project guarantees to guarantee the project performance of subsidiaries and
joint ventures to third parties.



    At November 30, 2001, the Company has committed to purchase fixed assets of
$15.1 million from external suppliers.



    Coflexip S.A. ("CSO") has commenced legal proceedings through the United
Kingdom High Court against three subsidiaries of Stolt Offshore S.A. claiming
infringement of a certain patent held by CSO relating to flexible flowline
laying technology in the United Kingdom Judgment was given on January 22, 1999
and January 29, 1999. The disputed patent was held valid. The Company appealed
and the Appeal Court maintained the validity of the patent and broadened its
application compared to the High Court decision. The Company has applied for
leave to appeal the Appeal Court decision to the House of Lords, which has now
been denied. During 2001, CSO submitted an amended claim to damages claiming the
lost profits on a total of 15 projects. In addition, there is a claim for
alleged price depreciation on certain other projects. The total claim is for
approximately $89 million, up from approximately $14 million claimed previously,
plus interest, legal costs and a royalty for each time that the flexible lay
system tower on the SEAWAY FALCON was brought into United Kingdom waters. The
Company estimates that the total claim will be of the order of $115 million. In
the alternative, CSO claims a reasonable royalty for each act of infringement,
interest and legal costs. CSO has not quantified this claim, but it will be
considerably less than the claim to lost profits. The Company, in consultation
with its advisers, has assessed that the range of possible outcomes for the
resolution of damages is $1.5 million to $115 million and has determined that
there is no amount within the range that is a better estimate than any other
amount. Consequently, in accordance with SFAS No. 5, "ACCOUNTING FOR
CONTINGENCIES", the Company has reserved $1.5 million in the financial
statements, being the lower end of the range. The amount of damages is
nevertheless uncertain and no assurance can be given that the provided amount is
sufficient.



    In September 1999, the Company terminated its charter of the ship, TOISA
PUMA, for default. The Company is currently in arbitration with the owners who
are contesting that the termination was wrongful. The arbitration has held that
the ship was in breakdown, but that the termination was nevertheless wrongful.
The Company applied for leave to appeal the decision to the High Court, which
has been denied. During 2001, the owner has quantified his claim to
approximately $8 million. The Company has disputed the magnitude of the claim in
relation to lack of instigation, lack of cost savings and lack of actual loss
for parts of the claim. In addition, the Company has a counterclaim related to
the breakdown of the ship. The Company, in consultation with its advisers, has
assessed the range of possible outcomes for the resolution of damages with the
upper amount being $8 million. The Company has determined that there is no
amount within the range that is a better estimate than any other amount.
Consequently, in accordance with SFAS No. 5, the Company has reserved
$2.0 million in


                                      F-34
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



22.  COMMITMENTS AND CONTINGENCIES (CONTINUED)


the financial statements, an amount to cover the liability for damages which is
at the lower end of the range. The amount of such liability is nevertheless
uncertain and no assurance can be given that the provided amount is sufficient.



    Legal costs are expensed as incurred.



    In the ordinary course of business, various claims, suits and complaints
have been filed against the Company. In the opinion of management, all such
matters are adequately covered by indemnity agreements, recorded provisions in
the financial statements and insurance or, if not so covered, would not have a
material effect on the financial position, results of operations or cash flows
of the Company if resolved unfavorably.



23.  FINANCIAL INSTRUMENTS



    The Company operates in a large number of countries throughout the world
and, as a result, is exposed to currency fluctuations largely as a result of
incurring operating expenses in the normal course of business. The Company's
major foreign currency exposures are to the Euro, British Pound and Norwegian
Krone. To manage this volatility, the Company nets the exposures on a
consolidated basis to take advantage of natural offsets. For the residual
portion, the Company enters into derivative instruments pursuant to the
Company's policies in areas such as counterparty exposure and hedging practices.
Designation is performed on a specific exposure basis to support hedge
accounting. The changes in the fair value of these derivative instruments are
offset in part or in whole by corresponding changes in the fair value of cash
flows of the underlying exposures being hedged. The Company does not hold or
issue derivative instruments for trading purposes.



    All of the Company's derivative instruments are over the counter instruments
entered into with major financial credit institutions to hedge the Company's
committed exposures. The Company's derivative instruments are primarily standard
foreign exchange forward contracts which subject the Company to a minimum level
of exposure risk and have maturities of less than 18 months. The Company does
not consider that it has a material exposure to credit risk from third parties
failing to perform according to the terms of derivative instruments.



    The following foreign exchange forward contracts, maturing between
December 13, 2001 and June 27, 2002 were outstanding as of November 30, 2001:



<Table>
=======================================================================================================
FOR THE YEAR ENDED NOVEMBER 30                                             2001                  2000
(in thousands)                                               PURCHASE      SELL     Purchase     Sell
=======================================================================================================
<S>                                                          <C>         <C>        <C>        <C>
Euros                                                          23,396        --     143,894        --
-------------------------------------------------------------------------------------------------------
Singapore Dollars                                                 300        --          --        --
-------------------------------------------------------------------------------------------------------
Norwegian Kroner                                                   --        --      97,000        --
-------------------------------------------------------------------------------------------------------
British Pounds                                                     --        --          --     7,240
-------------------------------------------------------------------------------------------------------
</Table>



    As of November 30, 2001, the fair values of these derivative instruments
were recorded in the consolidated balance sheet as $0.8 million in assets and
$0.8 million in liabilities. Gains and losses on these instruments are deferred
in OCI until the underlying transaction is recognized in the results of
operations. Qualifying cash flow hedges currently deferred in OCI are not
material. These amounts will be reclassified into results of operations as the
underlying transactions are recognized.


                                      F-35
<Page>

           NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)



23.  FINANCIAL INSTRUMENTS (CONTINUED)


    During the year ended November 30, 2001, no amount was recognized in the
statement of operations for an amount relating to a hedge's ineffectiveness or
to a discontinued fair value hedge or cash flow hedge.



    The following table summarizes the estimated fair value amounts of the
Company's other financial instruments which have been determined by the Company,
using appropriate market information and valuation methodologies. Considerable
judgment is required to develop these estimates of fair values, thus the
estimates provided herein are not necessarily indicative of the amounts that
could be realized in a current market exchange:



<Table>
=====================================================================================================
                                                                         2001                  2000
                                                            CARRYING     FAIR     Carrying     Fair
AS OF NOVEMBER 30                                             AMOUNT    VALUE       amount    value
(in millions)                                                      $        $            $        $
=====================================================================================================
<S>                                                         <C>        <C>        <C>        <C>
FINANCIAL ASSETS
-----------------------------------------------------------------------------------------------------
Cash and cash equivalents                                       11.7     11.7          6.3      6.3
-----------------------------------------------------------------------------------------------------
FINANCIAL LIABILITIES
-----------------------------------------------------------------------------------------------------
Bank overdrafts                                                  5.2      5.2          1.8      1.8
-----------------------------------------------------------------------------------------------------
Long-term debt                                                 335.0    335.0        265.0    265.0
=====================================================================================================
</Table>



    The carrying amounts of cash and cash equivalents and bank overdrafts
approximate their fair value. The estimated value of the Company's long-term
debt is based on interest rates at November 30, 2001 and 2000 using debt
instruments of similar risk.



24.  SUBSEQUENT EVENTS



    Vinci, owner of the 6,142,857 Common Shares issued as partial consideration
in the acquisition of ETPM in December 1999, has advised the Company of its
intention to sell all of the shares as permitted by the ETPM acquisition
agreement. The Company in turn has advised Vinci that it will organize the sale
and it is the Company's intention to buy the shares back in the second quarter
of 2002. The transaction will be funded through the use of existing credit
facilities and the sale of Common Shares to SNSA and other interested parties
for up to $65.0 million.


                                      F-36
<Page>

To the Members
of the G.I.E. Mar Profundo Girassol:



    We have audited the accompanying balance sheets of Mar Profundo Girassol as
of December 31, 2001 and December 31, 2000 and the related statements of income
and cash flows for each of the two years in the period ended December 31, 2001,
all expressed in Euros. These financial statements are the responsibility of the
company's management. Our responsibility is to express an opinion on this
financial statements based on our audits.



    We conducted our audits in accordance with generally accepted auditing
standards in France and in the United States of America. Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.



    In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Mar Profundo Girassol as of
December 31, 2001 and December 31, 2000, and the results of its operations and
its cash flows for each of the two years in the period ended December 31, 2001
in conformity with generally accepted accounting principles in France.



    Accounting practices used by the company in preparing the accompanying
financial statements conform with generally accepted accounting principles in
France, but do not conform in certain respects with accounting principles
generally accepted in the United States of America ("U.S. GAAP"). A description
of these differences and a complete reconciliation of net income to U.S. GAAP is
set forth in Note VIII.



Neuilly-sur-Seine,
France,
April 2, 2002



BARBIER FRINAULT & ASSOCIES
Member of Andersen Worldwide Organization
Francis Scheidecker


                                      F-37
<Page>

                                 BALANCE SHEETS



                           DECEMBER 31, 2001 AND 2000



                   ALL AMOUNTS REPORTED IN THOUSAND OF EUROS



<Table>
<Caption>
---------------------------------------------------------------------------------------------------------
ASSETS                                                                       NOTE        2001        2000
<S>                                                           <C>                   <C>         <C>
=========================================================================================================
Intangible assets, net                                        I 4                          --          --
Tangible assets, net                                          II 1 - II 2                  --         642
long-term investments, net                                    II 3                         11         232
---------------------------------------------------------------------------------------------------------
TOTAL NONCURRENT ASSETS                                                                    11         874
---------------------------------------------------------------------------------------------------------
Inventories and work-in-progress
Trade accounts receivables                                    IV 1                     88,220     116,072
Other receivables                                             IV 1                     37,475      23,193
Cash and cash equivalents                                     III                      17,893      15,245
Prepaid expenses                                              IV 2                        520       2,363
---------------------------------------------------------------------------------------------------------
TOTAL ASSETS                                                                          144,108     156,873
=========================================================================================================
LIABILITIES AND EQUITY                                        Note                      2,001       2,000
---------------------------------------------------------------------------------------------------------
Profit for the financial year                                                          17,263      27,294
Equity                                                                                 17,263      27,294
Reserves for losses and contingencies                         V 1                       3,734       1,302
Bank overdrafts                                                                        16,052       1,090
Trade accounts payable                                        V 2                      58,953     113,759
Other payables                                                V 2                      48,024      14,199
Deferred revenue                                                                           93         103
---------------------------------------------------------------------------------------------------------
TOTAL CURRENT LIABILITIES                                                             123,122     129,151
---------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND EQUITY                                                          144,119     157,747
=========================================================================================================
</Table>



    The accompanying notes are an integral part of these financial statements.


                                      F-38
<Page>

                               INCOME STATEMENTS



             FOR THE THREE FINANCIAL YEARS ENDED DECEMBER 31, 2001



                   ALL AMOUNTS REPORTED IN THOUSAND OF EUROS



<Table>
<Caption>
----------------------------------------------------------------------------------------------------------
                                                                                                      1999
                                                                  NOTE       2001       2000   (UNAUDITED)
<S>                                                           <C>        <C>        <C>        <C>
==========================================================================================================
Sales                                                         VI 1        113,287    243,428       406,515
Other income                                                                  657        585           550
----------------------------------------------------------------------------------------------------------
TOTAL OPERATING PRODUCTS                                                  113,943    244,013       407,065
----------------------------------------------------------------------------------------------------------
Purchase of raw material, equipment and supplies                           40,140    148,054       272,271
Other purchases and external charges                                       51,046     64,473        84,405
Taxes                                                                       1,491        391           992
Allowance for provisions and depreciations                                  3,426      1,372         2,823
Other expenses                                                                126        187         1,070
----------------------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES                                                   96,229    214,477       361,561
----------------------------------------------------------------------------------------------------------
Operating income                                                           17,714     29,536        45,504
----------------------------------------------------------------------------------------------------------
Financial interests and income                                                 84         94           137
Foreign exchange gains                                                        119        356           163
Net gains on sales of short-term investments                                   25         74           117
----------------------------------------------------------------------------------------------------------
TOTAL FINANCIAL INCOME                                                        229        524           417
----------------------------------------------------------------------------------------------------------
Financial expenses and interests                                                2          5             3
Foreign exchange losses                                                       681      2,471           668
----------------------------------------------------------------------------------------------------------
Total financial expenses                                      VI 3            683      2,476           671
----------------------------------------------------------------------------------------------------------
Financial income, net                                                       (454)    (1,952)         (254)
----------------------------------------------------------------------------------------------------------
Extraordinary income                                          VI 4              3      (290)         (155)
----------------------------------------------------------------------------------------------------------
NET INCOME (LOSS)                                             VI 5         17,263     27,294        45,095
==========================================================================================================
</Table>



    The accompanying notes are an integral part of these financial statements.


                                      F-39
<Page>

                            STATEMENT OF CASH FLOWS



             FOR THE THREE FINANCIAL YEARS ENDED DECEMBER 31, 2001



                   ALL AMOUNTS REPORTED IN THOUSAND OF EUROS



<Table>
<Caption>
-----------------------------------------------------------------------------------------------
                                                                                           1999
                                                                  2001       2000     Unaudited
<S>                                                           <C>        <C>        <C>
===============================================================================================
A--Cash flows from operating activities
Net Income                                                      17,263     27,294        45,095
Adjustments to reconcile net income to net cash provided
  (used in) by activities
Depreciation and amortization                                      641      1,052         1,397
Increase (decrease) of provisions                                2,432      (265)         1,497
Loss (gain) on sale of property, plant and equipment                 8        290            85
-----------------------------------------------------------------------------------------------
                                                                20,344     28,371        48,074
Changes in assets and liabilities
Decrease (increase) in trade accounts receivable                27,852     12,541     (101,260)
Decrease (increase) other current assets                      (12,440)     40,320         6,910
Increase (decrease) in trade accounts payable                 (54,806)    (5,265)        58,024
Increase (decrease) in other current liabilities                33,815   (17,162)      (10,323)
                                                                    --         --            --
-----------------------------------------------------------------------------------------------
                                                               (5,579)     30,434      (46,649)
-----------------------------------------------------------------------------------------------
Net Cash provided by operating activities                       14,765     58,805         1,425
B--Cash flows from investing activities
Increase of fixed assets
Acquisitions of fixed assets                                      (11)       (12)         (783)
Rent deposits                                                      222      (126)         (106)
-----------------------------------------------------------------------------------------------
                                                                   211      (138)         (889)
Proceeds from sales of assets                                        4        114           164
Increase (decrease) of liabilities related to investments           --         --         (515)
-----------------------------------------------------------------------------------------------
Net cash used in investing activities                              215       (24)       (1,240)
C--Cash flows from financing activities
Dividends paid                                                (27,294)   (45,095)            --
-----------------------------------------------------------------------------------------------
Increase (decrease) in bank overdrafts                          14,962      1,087           (4)
-----------------------------------------------------------------------------------------------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES           (12,332)   (44,008)           (4)
-----------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS             2,648     14,773           181
-----------------------------------------------------------------------------------------------
Cash and cash equivalents at beginning of year                  15,245        472           291
===============================================================================================
CASH AND CASH EQUIVALENTS AT END OF YEAR                        17,893     15,245           472
===============================================================================================
</Table>



    The accompanying notes are an integral part of these financial statements.


                                      F-40
<Page>

                       NOTES TO THE FINANCIAL STATEMENTS



    ALL AMOUNTS ARE PRESENTED IN THOUSANDS OF EUROS UNLESS STATED OTHERWISE.



    Mar Profundo Girassol is a "Groupement d'Interet Economique" (G.I.E.), which
is a French form of joint venture. It was incorporated April, 2 1998 and
registered June, 15 1998. The registration has a term of five years until June,
15 2003.



<Table>
<S>                   <C>
Registration number:  RCS Nanterre C 419 223 524
Main Office:          32 avenue Pablo Picasso
                      92000 Nanterre
                      France.
</Table>



    Mar Profundo Girassol members are:



<Table>
<S>                                    <C>
Bouygues Offshore                      Stolt Offshore
3 rue Stephenson                       32 avenue Pablo Picasso
78180 Montigny le Bretonneux           92000 Nanterre France
RCS: Versailles B 302588462            France RCS: Nanterre B 692007495
equity interest: 50%                   equity interest: 50%
</Table>



    The purpose of the G.I.E. is to jointly perform the following works:



1.  a Floating Production Storage and Offloading (FPSO) unit, comprising a
    floater with oil storage and loading / offloading facilities, accommodation
    quarters, station keeping system and a topside plant to process the fluid
    produced from the reservoir and provide various field operation facilities,



2.  a Loading Buoy unit which purpose is to moor a tanker for offloading oil
    from the FPSO.



    Scope of work includes engineering, procurement, transportation,
fabrication, installation and assistance to commissioning of the FPSO and the
buoy.



    As of the end of December 2001, the cumulative progress of the works
achieved was 99.7%.


                                      F-41
<Page>

                 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)



    ALL AMOUNTS ARE PRESENTED IN THOUSANDS OF EUROS UNLESS STATED OTHERWISE.



NOTE I--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



1.  FINANCIAL STATEMENTS PRESENTATION



    Financial statements are presented in Euros in compliance with generally
accepted French accounting principles. These accounting principles have not
changed since the incorporation of the G.I.E. Mar Profundo Girassol. The
accounting period is: January 1st to December 31st.



2.  USE OF ESTIMATES:



    In conformity with generally accepted accounting principles in France, the
preparation of financial statements requires management to make estimates and
assumptions based on current information and expectations. These may affect the
amounts reported in financial statements and accompanying notes. The actual
final results may differ from these estimates which may then impact subsequent
financial statements.



3.  FOREIGN CURRENCY TRANSACTIONS



    A substantial portion of Mar Profundo Girassol's revenue is denominated in
US Dollars. However, some of Mar Profundo Girassol's costs are denominated in
other currencies, particularly in Euro.



    In order to shield Mar Profundo Girassol from future currency exchange rate
variations, its policy is to hedge future forecasted outflows against future
forecasted inflows using forward sales contracts. This applies only to
unbalanced currency positions. Thus, US Dollar versus Euro forward sales
contracts are settled only for the portion of US Dollar revenue that exceeds US
Dollar expenditure or vice versa.



    Mar Profundo Girassol's exchange position is updated on a regular basis
using all information available such as actual and forecasted sales and
expenses, budget variations, management's best estimate, etc... Major variations
in the use of a currency different from the currency initially forecasted result
in an appropriate adjustment of the forward currency exchange contracts.



    It is not Mar Profundo Girassol's intent to hold derivative financial
instruments for speculative purpose.



    Based on the forward exchange rates for all the forward currency exchange
contracts, Mar Profundo Girassol determines an average exchange rate for each
currency against Euro, in particular for US Dollars. Hedged transactions
denominated in currencies other than Euro are recorded using the average
exchange rate as described above. All US Dollar denominated transactions are
recorded on a pre-determinated rate based on the forward exchange contracts as
explained above. A variation in the currency position that impacts currency
hedging, such as delays in cash collection or change in the currency of a
forecasted cash-flows results in costs because of the mismatch. This is
immediately evaluated for both current and subsequent impacts and reflected in
the accounts in proportion of the overall progress of the contract.



4.  INTANGIBLE AND TANGIBLE ASSETS



    Intangible assets


                                      F-42
<Page>

                 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)



    ALL AMOUNTS ARE PRESENTED IN THOUSANDS OF EUROS UNLESS STATED OTHERWISE.



NOTE I--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)


    These consist of the software for the project. Software is valued at its
acquisition cost and amortized on a straight-line basis over a period of one
year. This has been fully amortized as of December 31, 1999.



    Tangible assets



    Tangible assets are recorded at acquisition cost and depreciated on the
straight line method over 3 years.



    Long Term Investments



    These consist of deposits associated with operating lease contracts and are
valued at their historical cost. They are reversed when the leasing contract is
terminated and the deposit is reimbursed.



5.  CONTRACT AND REVENUE RECOGNITION



    Contract revenues and related costs are recognized on the percentage of
completion method, based on total project costs incurred to date, over the
estimated total costs of contract at completion. Claims for extra-work or change
in scope of work may be included in contract revenues when collection is
probable.



    Contract price and cost estimates are reviewed periodically as the works
progress and adjustments proportionate to the percentage of completion are
reflected in the margin. Billings that exceed revenues recognized under
percentage of completion are recorded as deferred revenue. Revenues recognized
under percentage of completion method that exceed billings are booked as
unbilled receivable.



    General and administrative costs supported by the members of the G.I.E are
not charged to Mar Profundo Girassol.



6.  CASH AND CASH EQUIVALENTS



    Cash equivalents consist of highly liquid investments (marketable
securities) with original maturity date of three months or less. Marketable
securities are accounted for at their historical value and gains are recorded as
financial income when sold.



7.  INCOME TAXES



    As a G.I.E, Mar Profundo Girassol shares its earnings between members in
proportion to equity interest.



    As a consequence and in application of French fiscal and corporate laws,
earnings of Mar Profundo Girassol taxable in France are subject to French income
tax at the level of the members.



    Corporate income tax borne by Mar Profundo Girassol for its non French
earnings are recognized, up to the percentage of completion of the project, in
Mar Profundo Girassol accounts.


                                      F-43
<Page>

                 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)



    ALL AMOUNTS ARE PRESENTED IN THOUSANDS OF EUROS UNLESS STATED OTHERWISE.



NOTE I--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)


8.  RETIREMENT BENEFITS



    The G.I.E Mar Profundo Girassol does not employ personnel directly. The
personnel engaged on the project are either employees of a G.I.E. member or
subcontracted. Any retirements benefits provisions, when necessary, are
accounted by these external companies.



9.  RESEARCH AND DEVELOPMENT



    Research and development costs are expensed when incurred.



NOTE II--FIXED ASSETS



1.  CHANGE IN TANGIBLE ASSETS



<Table>
=================================================================================================
                                                                                OTHERS
                                                       MACHINERY        IT       FIXED
                                                         EQUITY   EQUIPMENT     ASSETS      TOTAL
=================================================================================================
<S>                                                    <C>        <C>        <C>         <C>
Gross amount as of Dec. 31, 1999                            671      2,448         837      3,956
Additions                                                     0         12           0         12
Disposals                                                          (1,236)        (40)    (1,276)
Gross amount as of Dec. 31, 2000                            671      1,224         797      2,692
Additions                                                   (0)         11         (0)         11
Disposals                                                     0      (118)       (132)      (250)
Gross amount as of Dec. 31, 2001                            671      1,117         665      2,453
=================================================================================================
1999 is unaudited
</Table>



    Disposals result from the sale of obsolete data processing equipment.
Related revenue is reported as extraordinary income in the Income Statement.



2.  CHANGE IN ACCUMULATED DEPRECIATION OF FIXED ASSETS



<Table>
===================================================================================================
                                                                                  OTHERS
                                                         MACHINERY        IT       FIXED
                                                           EQUITY   EQUIPMENT     ASSETS      TOTAL
===================================================================================================
<S>                                                      <C>        <C>        <C>         <C>
Amount as of Dec. 31, 1999                                    359      1,005         504      1,869
Depreciations                                                 192        590         270      1,052
Disposal                                                        0      (850)        (21)      (871)
Amount as of Dec. 31, 2000                                    551        745         754      2,050
Depreciations                                                 120        483          38        641
Disposal                                                        0      (111)       (127)      (238)
Amount as of Dec. 31, 2001                                    671      1,117         665      2,453
===================================================================================================
1999 is unaudited
</Table>



3.  OTHER LONG TERM INVESTMENTS



    These amounts are made of deposits linked to operating leases.


                                      F-44
<Page>

                 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)



    ALL AMOUNTS ARE PRESENTED IN THOUSANDS OF EUROS UNLESS STATED OTHERWISE.



NOTE III--CASH AND CASH EQUIVALENTS



    These amounts represent cash at the bank.



NOTE IV--PREPAID EXPENSES AND OTHER CURRENT ASSETS



1.  TRADE ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES



<Table>
===========================================================================================================
                                                                   CURRENT
                                                      ADVANCE     ACCOUNTS
                                            TRADE    PAYMENTS         WITH
                                         ACCOUNTS          TO          GIE                 OTHER
(AMOUNT IN K EUR)                        RECEIVABLES SUPPLIERS     MEMBERS      OTHER   RECEIVABLES    TOTAL
===========================================================================================================
<S>                                      <C>        <C>         <C>          <C>        <C>        <C>
Gross amount as of December 31, 2000      116,072       9,727       10,201      3,265     23,193    139,265
-----------------------------------------------------------------------------------------------------------
Receivable from related parties
  included                                                  0       10,201         23     10,224     10,224
Accrued receivables included               93,349                        0     93,349
Gross amount as of December 31, 2001       88,220       9,674       22,447      5,353     37,475    125,694
-----------------------------------------------------------------------------------------------------------
Receivable from related parties
  included                                                  0       22,447        134     22,581     22,581
Accrued receivables included               48,798                                              0     48,798
===========================================================================================================
</Table>



    All amounts are due within one year.



2.  PREPAID EXPENSES



    These amounts represent the work progress adjustment of major subcontracts.



NOTE V--ACCRUED EXPENSES AND OTHER LIABILITIES



1.  RESERVES FOR LOSSES AND CONTINGENCIES



<Table>
========================================================================
                                                                RESERVES
                                                                     FOR
                                                              LOSSES AND
                                                              CONTINGENCIES
========================================================================
<S>                                                           <C>
Amount as of December 31, 2000                                     1,302
------------------------------------------------------------------------
Foreign Taxes(1)                                                     966
Plant demobilisation(2)                                              336
Amount as of December 31, 2001                                     3,734
------------------------------------------------------------------------
Foreign Taxes(1)                                                     373
Installation works and other(2)                                    3,361
========================================================================
</Table>



(1)  Income tax due by MPG in foreign countries is evaluated and accrued in
     proportion to the progress of the project.



(2)  Reserve against claims arising from the subcontracted installation works
     for the FPSO and Buoy moorings.


                                      F-45
<Page>

                 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)



    ALL AMOUNTS ARE PRESENTED IN THOUSANDS OF EUROS UNLESS STATED OTHERWISE.



NOTE V--ACCRUED EXPENSES AND OTHER LIABILITIES (CONTINUED)


2.  TRADE ACCOUNTS PAYABLE AND OTHER PAYABLES



<Table>
==============================================================================================================
                                                                      CURRENT
                                                                     ACCOUNTS
                                                TRADE                    WITH
                                             ACCOUNTS       DOWN          GIE      OTHER      OTHER
(AMOUNT IN K EUR)                             PAYABLE   PAYMENTS      MEMBERS   PAYABLES   PAYABLES      TOTAL
==============================================================================================================
<S>                                          <C>        <C>        <C>          <C>        <C>        <C>
Gross amount as of December 31, 2000          113,759     13,854                     345     14,199    127,958
--------------------------------------------------------------------------------------------------------------
Payables from related parties included          3,039          0                                  0      3,039
Accrued receivables included                   97,877                                             0     97,877
Gross amount as of December 31, 2001           58,953       3911       42,147      1,939     48,024    106,977
--------------------------------------------------------------------------------------------------------------
Payables from related parties included          3,647          0       42,174                42,174     45,821
Accrued expenses included                      30,149                                             0     30,149
==============================================================================================================
</Table>



NOTE VI--INCOME AND EXPENSES



1.  SALES



    Recognition of the contract income in proportion to the overall progress of
the project.



2.  RELATED PARTIES TRANSACTIONS



    Mar Profundo Girassol contracts with its members for the purchase of a
number of services in the normal course of business. The amounts are:



<Table>
=========================================================================
                                                               TRADE WITH
                                                                  RELATED
(AMOUNT IN K EUR)                                                 PARTIES
=========================================================================
<S>                                                            <C>
1999 (unaudited)                                                   14,039
2000                                                                7,724
2001                                                                2,993
=========================================================================
</Table>



3.  FINANCIAL INCOME



    These amounts represent mainly the cost of Mar Profundo Girassol currency
hedgings adjustments.



4.  EXTRAORDINARY INCOME



    These amounts are related to the sale and disposal of useless data
processing equipment.



5.  INCOME FOR THE FINANCIAL YEAR



    Mar Profundo Girassol's results does not include general and administrative
costs nor French income tax charges. These costs are accounted for at the G.I.E
members level. Results are immediately distributed to the G.I.E. members.


                                      F-46
<Page>

                 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)



    ALL AMOUNTS ARE PRESENTED IN THOUSANDS OF EUROS UNLESS STATED OTHERWISE.



NOTE VII--FORWARD CURRENCY CONTRACTS



<Table>
=============================================================================================
                                                                OUTSTANDING       OUTSTANDING
                                                                    FORWARD           FORWARD
                                                            CONTRACTS AS OF   CONTRACTS AS OF
                                                               DEC 31, 2001      DEC 31, 2000
                                                                  AMOUNT IN         AMOUNT IN
(AMOUNT IN KEUR)                                                   CURRENCY          CURRENCY
=============================================================================================
<S>                                                         <C>               <C>
Forward exchange--Currency sold
USD                                                              43,827,950        74,813,330
Forward exchange--Currency purchased
EURO                                                             39,227,755        63,393,047
NOK                                                                      00         1,987,000
GBP                                                                 540,000         1,981,000
=============================================================================================
ALL CONTRACTS ARE EXPECTED TO MATURE BEFORE THE END OF
  2002
</Table>



NOTE VIII--SIGNIFICANT DIFFERENCES BETWEEN ACCOUNTING PRINCIPLES FOLLOWED BY THE
COMPANY AND THE US GAAP



    The accompanying financial statements have been prepared in accordance with
French GAAP, which differ in some respects from the accounting principles
generally accepted in the United States of America ("US GAAP").



    The only significant difference that impacts the net equity and the net
income of the Company corresponds to the accounting of foreign currency
transactions in relation with hedging policy, as described hereafter.



1.  DESCRIPTION OF THE SIGNIFICANT DIFFERENCES BETWEEN ACCOUNTING PRINCIPLES
    FOLLOWED BY MAR PROFUNDO GIRASSOL AND THE US GAAP



    French GAAP accounting principles related to classification of cash flows



    Under French GAAP, two elements have been included under section B "Cash
flows from investing activities" of the Statement of Cash Flows which would have
been classified under US GAAP in section A "Cash flows from operating
activities." These are "Rent Deposits" and "Increase (decrease) of liabilities
related to investments."



    French GAAP accounting principles related to foreign currency transactions



    Under French GAAP, as disclosed in Note I.3 to the financial statements of
Mar Profundo Girassol, hedged foreign currency transactions are recorded using
the average guaranteed exchange rate resulting from the forward exchange
contracts used as hedges, which includes the discount or premiums from those
various contracts. Discount or premiums resulting from further rollovers of
these contracts are recorded in proportion to the percentage of completion of
the project.



    US GAAP accounting principles related to foreign currency transactions



    For the year 2000



    Under US GAAP, transactions denominated in foreign currencies are recorded
using the exchange rate prevailing at the date of the transaction, except for
the portion being hedged which is recorded


                                      F-47
<Page>

                 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)



    ALL AMOUNTS ARE PRESENTED IN THOUSANDS OF EUROS UNLESS STATED OTHERWISE.



NOTE VIII--SIGNIFICANT DIFFERENCES BETWEEN ACCOUNTING PRINCIPLES FOLLOWED BY THE
COMPANY AND THE US GAAP (CONTINUED)


using the spot rate of the forward exchange contract designated as a hedge.
Discounts of premiums of the forward exchange contract are recorded over the
period covered by the hedge.



    At year-end, cash, receivables and payables to be received in foreign
currency, are translated at year-end exchange rates, the translation difference
is recorded in net earnings except for the portion being hedged which is
deferred.



    For the year 2001



    For US GAAP reconciliation purposes, the Company has adopted as of
January 1, 2001, Statement of Financial Accounting Standards No. 133, Accounting
for Derivative Instruments and Hedging Activities issued by the Financial
Accounting Standards Board (FASB) in June 1998. In June 1999, the FASB issued
Statement No. 137, Accounting for Derivative Instruments and Hedging
Activities--Deferral of the Effective Date of FASB Statement No. 133. In
June 2000, the FASB issued Statement 138, Accounting for Certain Derivative
Instruments and Certain Hedging Activities, an amendment of FASB Statement
No. 133. Statement 133, as amended, establishes accounting and reporting
standards requiring that every derivative instrument (including certain
derivative instruments embedded in other contracts) be recorded in the balance
sheet as either an asset or liability measured at its fair value. The Statement
requires that changes in the derivative instrument's fair value be recognized
currently in earnings unless specific hedge accounting criteria are met. Special
accounting for qualifying hedges allows a derivative instrument's gains and
losses to offset related results on the hedged item in the income statement, to
the extent effective, and requires that a company must formally document,
designate, and assess the effectiveness of transactions that receive hedge
accounting.



    Cash inflows generated by the sale contract with Elf Exploration Angola are
denominated in U.S. Dollars, and are, as mentioned in note I.3 used to cover
cash outflows denominated in the same currency. Additionally, the Company uses
foreign currency forwards to hedge the foreign currency risks related to certain
cash outflows not denominated in USD, and to finally exchange U.S dollars in its
functional currency.



    As of January 1, 2001, the Company identified the foreign currency component
of its sale contract as an embedded foreign exchange derivative. A portion of
each monthly USD cash inflows generated according to the provisions of the sale
contract was designated under SFAS 133 either:



1.  as a fair value hedge of recognized liabilities and firm purchase
    commitments in USD or a cash-flow hedge of anticipated transactions
    denominated in such currency,



2.  or, if associated with forward exchange contracts, as a fair value hedge of
    recognized liabilities and firm purchase commitments in currencies others
    than USD or Euros or a cash-flow hedge of anticipated transactions
    denominated in such currencies.



    All residual USD cash inflows were converted in Euro using forward exchange
contracts. Such hedge relationship is considered as a natural hedge under
SFAS 133.



    As of December 31, 2001, due to the percentage of completion of the contract
with Elf Exploration Angola almost all anticipated inflows and outflows have
been invoiced, and/or accrued for in the balance sheet. All amounts recorded in
OCI as of January 1, 2001 (MEUR 2,3) have been reclassified in earnings over the
period (symmetrically with the hedged cash flows). As of December 31,


                                      F-48
<Page>

                 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)



    ALL AMOUNTS ARE PRESENTED IN THOUSANDS OF EUROS UNLESS STATED OTHERWISE.



NOTE VIII--SIGNIFICANT DIFFERENCES BETWEEN ACCOUNTING PRINCIPLES FOLLOWED BY THE
COMPANY AND THE US GAAP (CONTINUED)


2001 all hedging relationships are natural hedges consisting of foreign currency
receivables or payables, residual embedded derivative and hedging forward
contracts.



    Under French GAAP, all foreign currency transactions are recorded based on
the average hedge rate and the derivative instruments are not recognized. Under
US GAAP all revenues and expenses denominated in foreign currencies should be
recorded using the exchange rate prevailing at the date of the transaction,
except for those from which embedded derivatives were bifurcated which are
recorded at the forward exchange rates prevailing as of the dates the contracts
were signed. For US GAAP reconciliation purposes, all revenues and expenses were
revalued accordingly which resulted in a reclassification of MEUR 33,8 from
operating profit to financial profit. In addition, all receivables and payables
were re-measured at closing spot rate and all outstanding derivatives (either
embedded or freestanding) were recognized in the balance sheet. This adjustment
resulted in a MEUR 3,3 net impact in earnings.



    Under French GAAP, gains and losses arising from the disposal of fixed
assets are classified as extraordinary income. Under the US GAAP, such items
would be a component of operating income/ (expense). This difference would
adjust operating income under US GAAP to the following:



<Table>
=================================================================================================
                                                                                             1999
                                                                  2001       2000     (UNAUDITED)
=================================================================================================
<S>                                                           <C>        <C>        <C>
Operating income under French GAAP                              17,714     29,536          45,504
-------------------------------------------------------------------------------------------------
Gains/(Losses) on fixed assets disposal                              3      (290)           (155)
-------------------------------------------------------------------------------------------------
Operating income under US GAAP                                  17,711     29,246          45,349
=================================================================================================
</Table>



2.  QUANTIFICATION OF THE DIFFERENCE ON 2000 AND 2001 NET INCOME AND NET EQUITY



    (In millions of Euro)



<Table>
=================================================================================
                                                                  2001       2000
=================================================================================
<S>                                                           <C>        <C>
Net income/(loss), as reported                                    17,3       27,3
---------------------------------------------------------------------------------
Foreign Currency transactions adjustment                           3,3        0,5
---------------------------------------------------------------------------------
Net income/(loss) in accordance with US GAAP                      20,6       27,8
=================================================================================
</Table>



    The net income of French "G.I.E." is immediately shared proportionately
among its partners. Thus, the adjustments cannot be reflected in Net Equity,
which only corresponds to the result of the year.


                                      F-49
<Page>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS



TO STOLT OFFSHORE S.A.:



    We have audited in accordance with generally accepted auditing standards in
the United States, the consolidated financial statements included in Stolt
Offshore S.A.'s Annual Report to Shareholders incorporated by reference in this
Form 20-F, and have issued our report thereon dated January 30, 2002. Our audits
were made for the purpose of forming an opinion on those statements taken as a
whole. The schedule listed in the Index on page F-1 is the responsibility of the
Company's management and is presented for purposes of complying with the
Securities and Exchange Commission's rules and is not part of the basic
consolidated financial statements. This schedule has been subjected to the
auditing procedures applied in the audits of the basic consolidated financial
statements and, in our opinion, fairly states in all material respects the
financial data required to be set forth therein in relation to the basic
consolidated financial statements taken as a whole.



                                          ARTHUR ANDERSEN



/s/ ARTHUR ANDERSEN
Glasgow, United Kingdom



January 30, 2002


                                      S-1
<Page>

                                                                     SCHEDULE II



                      STOLT OFFSHORE S.A. AND SUBSIDIARIES



                       VALUATION AND QUALIFYING ACCOUNTS



                             (AMOUNTS IN THOUSANDS)



<Table>
<Caption>
                                       BALANCE AT    CHARGED TO   WRITE-OFFS
                                      BEGINNING OF   COSTS AND    AGAINST THE    OTHER ADD    BALANCE AT END
                                         PERIOD       EXPENSES      RESERVE     (DEDUCT)(A)     OF PERIOD
                                      ------------   ----------   -----------   -----------   --------------
<S>                                   <C>            <C>          <C>           <C>           <C>
FOR THE YEAR ENDED NOVEMBER 30,
  1999:
Allowance for doubtful accounts.....     $ 4,705       $ 2,375       $  (895)     $    20        $ 6,205
Other...............................     $ 5,442       $ 2,001       $(3,914)     $   (12)       $ 3,517

FOR THE YEAR ENDED NOVEMBER 30,
  2000:
Allowance for doubtful accounts.....     $ 6,205       $ 3,076       $  (937)     $   (49)       $ 8,295
Other...............................     $ 3,517       $10,601       $(5,000)     $17,710(b)     $26,828

FOR THE YEAR ENDED NOVEMBER 30,
  2001:
Allowance for doubtful accounts.....     $ 8,295       $ 7,241       $(6,364)     $     4        $ 9,176
Other...............................     $26,828       $ 9,634       $(5,301)     $   172        $31,333
</Table>


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


(a) Includes the effect of exchange rate changes on beginning balances of
    valuation and qualifying accounts (except as otherwise noted).



(b) The majority of this balance arises through the acquisition of ETPM S.A.


                                      S-2