See Notes to Consolidated Financial Statements.

See Notes to Consolidated Financial Statements.

See Notes to Consolidated Financial Statements.

1.    Basis of Presentation - The accompanying unaudited condensed consolidated financial statements include the accounts of Global Industries, Ltd. and its subsidiaries (the "Company").

In the opinion of management of the Company, all adjustments (such adjustments consisting only of a normal recurring nature) necessary for a fair presentation of the operating results for the interim periods presented have been included in the unaudited condensed consolidated financial statements. Operating results for the period ended September 30, 2003, are not necessarily indicative of the results that may be expected for the year ending December 31, 2003. These financial statements should be read in conjunction with the Company's audited consolidated financial statements and related notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2002.

Independent public accountants as stated in their report included herein, have reviewed the financial statements required by Rule 10-01 of Regulation S-X.

Certain reclassifications have been made to the prior period financial statements in order to conform to the classifications adopted for reporting in 2003.

2.    New Accounting Pronouncement - Statement of Financial Accounting Standards ("SFAS") No. 143, "Accounting for Asset Retirement Obligations," requires the recording of liabilities for all legal obligations associated with the retirement of long-lived assets that result from the normal operation of those assets. These liabilities are required to be recorded at their fair values (which are likely to be the present values of the estimated future cash flows) in the period in which they are incurred. SFAS No. 143 requires the associated asset retirement costs to be capitalized as part of the carrying amount of the long-lived asset. The asset retirement obligation will be accreted each year through a charge to expense. The amounts added to the carrying amounts of the assets will be depreciated over the useful lives of the assets. The Company implemented SFAS No. 143 on January 1, 2003. This implementation did not have a material impact on the Company's consolidated financial position or results of operations.

FASB Interpretation ("FIN") 46, Consolidation of Variable Interest Entities, which applies to variable interest entities created after January 31, 2003, addresses consolidation by business enterprises of variable interest entities. FIN 46 is effective in the first interim period ending after December 15, 2003. The Company does not expect the implementation of this standard to have a material impact on its financial position or results of operation.

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (the "FASB") which are adopted by the Company as of the specified effective date. Unless otherwise discussed, management believes the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company's consolidated financial statements upon adoption.

3.    Accounts Receivable - Trade and other receivables are stated at net realizable value and the allowance for uncollectible accounts was $5.5 million and $7.2 million at September 30, 2003 and December 31, 2002, respectively. Certain receivables represent amounts that have not yet been billed to the customer pursuant to contractually specified milestone billing requirements. At September 30, 2003 and December 31, 2002, the Company's accounts receivable included unbilled receivables of $29.3 million and $20.3 million, respectively. The Company includes claims and unapproved change orders to the extent of costs incurred in contract revenues when (1) the contract or other evidence provides a legal basis for the claim, (2) additional costs are not the result of deficiencies in the Company's performance, (3) costs are identifiable and, (4) evidence supporting the claim is objective and verifiable. The claims and unapproved change orders, included in accounts receiv able and unbilled receivables, amounted to $25.5 million at September 30, 2003 and $23.8 million at December 31, 2002. Unbilled retainage at September 30, 2003 was $13.6 million and is expected to be billed in 2003. Unbilled retainage at December 31, 2002 was $4.9 million.

4.    Goodwill - In June 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible Assets." SFAS No. 142 changes the accounting for goodwill from an amortization method to an impairment-only approach. Amortization of goodwill, including goodwill recorded in past business combinations, ceased upon adoption of this statement. The Company completed the required annual impairment test at the beginning of 2003 and determined that its goodwill was not impaired

5.    Stock-Based Compensation - SFAS No. 123, "Accounting for Stock-Based Compensation" encourages, but does not require, companies to record compensation cost for stock-based employee compensation plans at fair value. The Company has chosen to continue to account for stock-based compensation using the intrinsic value method prescribed in Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" ("APB 25") and related interpretations and has adopted the disclosure-only provisions of SFAS 123. Accordingly, compensation cost for restricted stock awards and stock options is measured as the excess, if any, of the quoted market price of the Company's stock at the date of the grant over the amount an employee must pay to acquire the stock.

6. Income Taxes - The Company's effective tax rate for the quarter ended September 30, 2003 was (89%). The change in the effective tax rate from the nine months ended 2002 is due primarily to a reduction in earnings in certain foreign jurisdictions that are taxed on a deemed profits, percentage of revenue, basis and net operating losses in certain foreign jurisdictions where the Company did not record a tax benefit. In addition, the Company recorded a $4.6 million tax expense attributable to the establishment of a valuation allowance for a capital loss carry-forward previously anticipated to be utilized by 2004.

7. Financing Arrangements - The Company maintains a $100.0 million revolving loan credit facility. This facility matures on December 30, 2004. The revolving loan facility permits both prime rate bank borrowings and London Interbank Offered Rate ("LIBOR") borrowings plus a floating spread. The spreads can range from 0.75% to 2.00% and 2.00% to 3.25% for prime rate and LIBOR based borrowings, respectively. In addition, the credit facility allows for certain fixed rate options on amounts outstanding. Stock of the Company's subsidiaries, certain real estate, and the majority of the Company's vessels collateralize the loans under the credit facility. The revolving loan facility is subject to certain financial covenants.

Effective June 30, 2003, the Company amended its credit facility due to anticipated non-compliance with the leverage ratio covenant for the quarter ending June 30, 2003 and the next three quarters. The amendment reduced the requirements of the leverage ratio covenant for quarters ending June 30, 2003 through December 31, 2004. In consideration for this amendment, the Company paid a fee of $0.2 million. As of November 1, 2003, the Company had $63.3 million of credit capacity under this credit facility. At September 30, 2003, the Company was in compliance with the terms of its credit facility. Based upon the Company's current expectations of its operations, the leverage ratio covenant under the facility is not expected to be met at the end of the fourth quarter of 2003. In addition, based on current expectations of operations for 2004, certain financial covenants are likely to not be met in 2004. As a result, the Company is currently in discussions with its lenders to obtain a waiver or to amend the relevant financial covenants. The Company is likely to have to pay a fee in connection with any amendment or waiver. Although the Company expects to receive a waiver or amendment, no assurance can be given that such will be agreed to and if a waiver or amendment is not obtained and the Company is unable to meet the covenant requirements, the Company would not be able to borrow under the facility which would have a material adverse effect on its business and liquidity unless alternative borrowing facilities were found.

The Company's Title XI bonds mature in 2020, 2022, and 2025. The bonds carry interest rates of 8.30%, 7.25%, and 7.71% per annum, respectively, and require aggregate semi-annual payments of $2.8 million, plus interest. The agreements pursuant to which the Title XI bonds were issued contain certain covenants, including the maintenance of minimum working capital and net worth requirements. If not met, additional covenants result that restrict the Company's operations and its ability to pay cash dividends. At September 30, 2003, the Company was in compliance with these covenants.

The Company also has a $7.5 million short-term credit facility at one of its foreign locations which is secured by a letter of credit.

8. Commitments and Contingencies - The Company is a party to legal proceedings and potential claims arising in the ordinary course of business. Management does not believe these matters will materially effect the Company's consolidated financial statements.

In November of 1999, the Company notified Groupe GTM (now Vinci) that as a result of material adverse changes and other breaches by Groupe GTM, the Company was no longer bound by and was terminating the Share Purchase Agreement to purchase the shares of ETPM S.A., a French marine construction subsidiary of Groupe GTM. Groupe GTM responded stating that they believed the Company was in breach. The Share Purchase Agreement provided for liquidated damages of $25.0 million to be paid by a party that failed to consummate the transaction under certain circumstances. The Company notified Groupe GTM that it did not believe that the liquidated damages provision was applicable to the Company's termination of the Share Purchase Agreement. On December 23, 1999, the Company filed suit against Groupe GTM in Tribunal de Commerce de Paris to recover damages. On June 21, 2000, Groupe GTM filed an answer and counterclaim against the Company seeking the liquidated damages of $25.0 million and other damag es, costs and expenses of approximately $3.2 million.

An oral hearing was held in the matter on May 28, 2003 before a three judge panel. No witness testimony was allowed under the French procedure but briefs and volumes of documents were provided to the panel. Upon the conclusion of arguments, Vinci filed pleadings requesting an increase in the liquidated damages of $25.0 million based upon changes in the euro exchange rate from 1999 until payment. The court accepted the pleadings and a new oral hearing was held on October 29, 2003. The court is expected to rule on the entire case before the end of November 2003. While the outcome of this matter cannot be predicted and the lower court could rule against the Company, any unfavorable outcome in the Tribunal de Commerce de Paris is appeallable to the Cour d'appel de Paris (Paris Court of Appeals). Such appeal would be conducted as a new trial and the appeals court would not be bound by the ruling or conclusions of the lower court. The Company does not believe that the ultimate outc ome of these matters will have a material adverse effect on its business, however, an adverse judgement by The Tribunal de Commerce de Paris which required payment of damages prior to completion of the appeals process could materially and adversely effect the Company's business and liquidity. In such event, the Company expects to seek additional borrowing capacity under its existing or a new credit facility. There can be no assurance, however, that such borrowing capacity could be obtained on terms satisfactory to the Company.

In the normal course of its business activities, the Company provides letters of credit to secure the performance and/or payment of obligations, including the payment of worker's compensation obligations. At September 30, 2003, outstanding letters of credit approximated $13.6 million. Also in the normal course of its business activities, the Company provides guarantee and performance, bid, and payment bonds under the terms of agreements with customers, or in connection with bidding to obtain such agreements. All of these financial instruments are secured by parent company guarantees. The aggregate of these guarantees and bonds at September 30, 2003 was $85.7 million.

The Company estimates that the cost to complete capital expenditure projects in progress at September 30, 2003 approximates $2.0 million.

9. Treasury Shares - In June 2003, the Company retired 3.7 million shares of treasury stock. These shares have been cancelled.

10. Industry Segment Information - The Company has conformed its segment reporting to changes in its operating management structure and existing business lines that were effective January 1, 2003. The Company's new reportable segments include two divisions, the Offshore Construction Division and the Global Divers and Marine Contractors Division, each with five reportable segments. The Global Divers and Marine Contractors Division includes all diving and marine support services worldwide, and Gulf of Mexico shallow water pipelay. The following tables present information about the profit or loss of each of the Company's reportable segments for the three months and nine months ended September 30, 2003 and 2002. The information contains certain allocations of corporate expenses that the Company deems reasonable and appropriate for the evaluation of results of operations.

The following table reconciles the revenues of the reportable segments and profit or loss presented above, to the Company's consolidated totals.

11. Comprehensive Income - Following is a summary of the Company's comprehensive income for the three months and nine months ended September 30, 2003 and 2002:

12. Asset Sales - During the quarter ended September 30, 2003, the Company recorded a gain of approximately $5.6 million, before tax, from the sale of two construction vessels in its Latin America segment.

The following discussion presents management's discussion and analysis of our financial condition and results of operations. The following discussion should be read in conjunction with our unaudited condensed consolidated financial statements for the periods ended September 30, 2003 and 2002, included elsewhere in this report and our audited consolidated financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report of Form 10-K for the year ended December 31, 2002.

Certain of the statements included below, including those regarding future financial performance or results or that are not historical facts, are or contain "forward-looking" information as that term is defined in the Securities Exchange Act of 1934, as amended. The words "expect," "believe," "anticipate," "project," "estimate," and similar expressions are intended to identify forward-looking statements. We caution readers that any such statements are not guarantees of future performance or events and such statements involve risks, uncertainties and assumptions. In addition to the factors discussed under the heading "Business-Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2002, the factors that could cause actual results to differ from those expected include, but are not limited to, dependence on the oil and gas industry and industry conditions, general economic conditions including in terest rates and inflation, competition, ability to obtain funds to finance our business, operating risks, including our ability to perform contracts within the time and costs of our bid, contract bidding risks, the use of estimates for revenue recognition, risks of international operations, risks of vessel construction such as cost overruns, changes in government regulations, and disputes with construction contractors, dependence on key personnel and the availability of skilled workers during periods of strong demand, the impact of regulatory and environmental laws, the ability to obtain insurance, and other factors discussed below. Operating risks include hazards such as vessel capsizing, sinking, grounding, colliding, and sustaining damage in severe weather conditions. These hazards can also cause personal injury, loss of life, and suspension of operations. The risks inherent with international operations include political, social, and economic instability, exchange rate fluctuations, currency restrict ions, nullification, modification, or renegotiations of contracts, potential vessel seizure, nationalization of assets, import-export quotas, and other forms of public and governmental regulation. Should one or more of these risks or uncertainties materialize or should the underlying assumptions prove incorrect, actual results and outcomes may differ materially from those indicated in the forward-looking statements.

The following table sets forth, for the periods indicated, our statements of operations expressed as a percentage of revenues.