SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 10-Q
(Mark One)

[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934

For the quarterly period ended June 30, 2003 or
-------------

[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934

For the transition period from to
----------- ------------

Commission file number 1-12289
------------------------------------------------------

SEACOR SMIT INC.
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)

Delaware 13-3542736
- ------------------------------- -------------------------------
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)

11200 Richmond, Suite 400, Houston, Texas 77082
- ----------------------------------------- ---------------------------
(Address of Principal Executive Offices) (Zip Code)

(281) 899-4800
- --------------------------------------------------------------------------------
(Registrant's Telephone Number, Including Area Code)

Not Applicable
- --------------------------------------------------------------------------------
(Former Name, Former Address and Former Fiscal Year,
if Changed Since Last Report)

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 whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [X] No [ ]

The total number of shares of common stock, par value $.01 per share,
outstanding as of August 5, 2003 was 18,768,089. The Registrant has no other
class of common stock outstanding.

SEACOR SMIT INC. AND SUBSIDIARIES

TABLE OF CONTENTS

Page No.

Part I. Financial Information

Item 1. Financial Statements

Condensed Consolidated Balance Sheets as of
June 30, 2003 and December 31, 2002......................................1

Condensed Consolidated Statements of Operations for each of the
Three and Six Months Ended June 30, 2003 and 2002........................2

Condensed Consolidated Statements of Cash Flows
for each of the Six Months Ended June 30, 2003 and 2002..................3

Notes to the Condensed Consolidated Financial Statements......................4

Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.................................9

Item 3. Quantitative and Qualitative Disclosures About Market Risk........................17

Item 4. Controls and Procedures...........................................................17

Part II. Other Information

Item 4. Submission of Matters to a Vote of Security Holders...............................18

Item 6. Exhibits and Reports on Form 8-K..................................................18

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

SEACOR SMIT INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA, UNAUDITED)

June 30, December 31,
2003 2002
----------------- -----------------

ASSETS
Current Assets:
Cash and cash equivalents.................................................... $ 246,863 $ 342,046
Marketable securities........................................................ - 7,984
Trade and other receivables, less doubtful account allowance
of $1,492 and $1,421, respectively........................................ 109,257 106,120
Prepaid expenses and other................................................... 25,941 17,041
----------------- -----------------
Total current assets................................................... 382,061 473,191
----------------- -----------------

Investments, at Equity, and Receivables from 50% or Less Owned Companies........ 66,007 61,359

Available-for-Sale Securities................................................... 77,008 80,641

Property and Equipment.......................................................... 982,857 988,443
Less - accumulated depreciation.............................................. (271,444) (250,475)
----------------- -----------------
Net property and equipment................................................ 711,413 737,968
----------------- -----------------

Construction Reserve Funds...................................................... 107,925 95,260

Other Assets.................................................................... 35,286 38,688
----------------- -----------------
$ 1,379,700 $ 1,487,107
================= =================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt............................................ $ 116 $ 614
Accounts payable and accrued expenses........................................ 25,834 31,799
Other current liabilities.................................................... 36,861 39,008
----------------- -----------------
Total current liabilities................................................. 62,811 71,421
----------------- -----------------

Long-term Debt.................................................................. 332,187 402,118

Deferred Income Taxes........................................................... 181,871 174,987

Deferred Gains and Other Liabilities............................................ 28,387 31,938

Minority Interest in Subsidiaries............................................... 1,881 1,692

Stockholders' Equity:
Common stock, $.01 par value, 24,394,640 and 24,307,235 shares
issued at June 30, 2003 and December 31, 2002, respectively............... 244 243
Additional paid-in capital................................................... 407,056 403,590
Retained earnings............................................................ 530,217 519,430
Less 5,601,251 and 4,386,143 shares held in treasury at
June 30, 2003 and December 31, 2002, respectively, at cost................ (172,649) (127,587)
Less unamortized restricted stock compensation............................... (4,226) (2,217)
Accumulated other comprehensive income:
Cumulative translation adjustments....................................... 7,968 5,750
Unrealized gain on available-for-sale securities......................... 3,953 5,742
----------------- -----------------
Total stockholders' equity................................................ 772,563 804,951
----------------- -----------------
$ 1,379,700 $ 1,487,107
================= =================

The accompanying notes are an integral part of these financial statements
and should be read in conjunction herewith.

SEACOR SMIT INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE DATA, UNAUDITED)

Three Months Ended Six Months Ended
June 30, June 30,
------------------------------- --------------------------------
2003 2002 2003 2002
------------- -------------- -------------- --------------

Operating Revenues..........................................$ 105,159 $ 97,670 $ 202,019 $ 201,313
------------- -------------- -------------- --------------

Costs and Expenses:
Operating expenses........................................ 69,422 61,133 136,522 118,289
Administrative and general................................ 13,391 12,803 27,470 25,163
Depreciation and amortization............................. 13,708 13,996 28,344 27,872
------------- -------------- -------------- --------------
96,521 87,932 192,336 171,324
------------- -------------- -------------- --------------
Operating Income............................................. 8,638 9,738 9,683 29,989
------------- -------------- -------------- --------------

Other Income (Expense):
Interest on debt.......................................... (4,419) (3,796) (9,925) (7,797)
Interest income........................................... 1,870 2,102 4,426 3,969
Income from equipment sales and retirements, net.......... 414 938 5,561 3,237
Debt extinguishment....................................... (966) - (2,091) -
Derivative income , net................................... 2,624 1,404 4,373 632
Foreign currency transaction gains, net................... 1,294 6,411 1,829 3,251
Other, net................................................ 503 487 2,697 (678)
------------- -------------- -------------- --------------
1,320 7,546 6,870 2,614
------------- -------------- -------------- --------------
Income Before Income Taxes, Minority Interest and Equity in
Earnings of 50% or Less Owned Companies................... 9,958 17,284 16,553 32,603
Income Tax Expense........................................... 3,596 6,156 5,995 11,399
------------- -------------- -------------- --------------
Income Before Minority Interest and Equity in Earnings of
50% or Less Owned Companies............................... 6,362 11,128 10,558 21,204
Minority Interest in Income of Subsidiaries.................. (241) (95) (339) (188)
Equity in Earnings of 50% or Less Owned Companies............ 322 1,215 568 2,638
------------- -------------- -------------- --------------
Net Income..................................................$ 6,443 $ 12,248 $ 10,787 $ 23,654
============= ============== ============== ==============

Basic Earnings Per Common Share.............................$ 0.34 $ 0.61 $ 0.55 1.18
============= ============== ============== ==============

Diluted Earnings Per Common Share...........................$ 0.33 $ 0.59 $ 0.55 1.15
============= ============== ============== ==============

Weighted Average Common Shares:
Basic..................................................... 19,155,421 20,078,231 19,463,596 20,058,824
Diluted................................................... 19,315,817 21,393,472 19,834,307 21,373,534

The accompanying notes are an integral part of these financial statements
and should be read in conjunction herewith.

SEACOR SMIT INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS, UNAUDITED)

Six Months Ended June 30,
2003 2002
----------------- -----------------

Net Cash Provided by Operating Activities.............................................. $ 15,375 $ 37,920
----------------- -----------------

Cash Flows from Investing Activities:
Purchase of property and equipment.................................................. (64,986) (60,008)
Proceeds from equipment sales....................................................... 71,927 53,757
Purchase of available-for-sale securities........................................... (21,457) (11,565)
Proceeds from sale of available-for-sale securities................................. 34,288 10,970
Investments in and advances to 50% or less owned companies.......................... (6,605) (1,470)
Principal payments on notes due from 50% or less owned companies.................... 857 5,618
Dividends received from 50% or less owned companies................................. 3,169 1,290
Net increase in construction reserve funds.......................................... (12,665) (7,930)
Cash settlements from derivative transactions....................................... (65) (851)
Acquisitions, net of cash acquired.................................................. - (109)
Other, net.......................................................................... 634 707
----------------- -----------------
Net cash provided by (used in) investing activities.............................. 5,097 (9,591)
----------------- -----------------

Cash Flows from Financing Activities:
Payments of long-term debt.......................................................... (71,310) (33,696)
Proceeds from issuance of long-term debt............................................ - 96
Premium paid with 5-3/8% note extinguishment........................................ (632) -
Proceeds from exercise of stock options............................................. 33 349
Proceeds from employee stock purchase plan.......................................... 361 363
Common stock acquired for treasury.................................................. (45,351) -
Other............................................................................... (150) -
----------------- -----------------
Net cash used in financing activities............................................ (117,049) (32,888)
----------------- -----------------

Effect of Exchange Rate Changes on Cash and Cash Equivalents........................... 1,394 (1,995)
----------------- -----------------

Net Decrease in Cash and Cash Equivalents.............................................. (95,183) (6,554)
Cash and Cash Equivalents, Beginning of Period......................................... 342,046 180,394
----------------- -----------------
Cash and Cash Equivalents, End of Period............................................... $ 246,863 $ 173,840
================= =================

The accompanying notes are an integral part of these financial statements
and should be read in conjunction herewith

SEACOR SMIT INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

The condensed consolidated financial information for the three and six-month
periods ended June 30, 2003 and 2002 has been prepared by the Company and was
not audited by its independent public accountants. In the opinion of management,
all adjustments (consisting only of normal recurring adjustments) have been made
to present fairly the financial position, results of operations and cash flows
of the Company at June 30, 2003 and for all reported periods. Results of
operations for the interim periods presented are not necessarily indicative of
the operating results for the full year or any future periods.

Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. These condensed consolidated financial
statements should be read in conjunction with the financial statements and
related notes thereto included in the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 2002.

Unless the context otherwise indicates, any references in this Quarterly Report
on Form 10-Q to the "Company" refer to SEACOR SMIT Inc. and its consolidated
subsidiaries, and any references in this Quarterly Report on Form 10-Q to
"SEACOR" refer to SEACOR SMIT Inc.

Certain reclassifications of prior year information have been made to conform
with the current year presentation.

2. CHANGES IN ACCOUNTING POLICIES AND ESTIMATES

Effective January 1, 2003, the Company adopted SFAS 145, "Recission of FASB
Statements Nos. 4, 44 and 64, Amendment of FASB Statement No. 13 and Technical
Corrections." This statement, among other matters, eliminates the requirement
that gains or losses on the early extinguishment of debt be classified as
extraordinary items and provides guidance when gains or losses on the early
retirement of debt should or should not be reflected as an extraordinary item.
Adopting SFAS 145 had no impact on the financial statements of the prior periods
reported. During the six-month period ended June 30, 2003, the Company redeemed
all of the then outstanding principal amount of its 5-3/8% Convertible
Subordinated Notes due November 15, 2006 (the "5-3/8% Notes") and prepaid all
outstanding principal and accrued interest payable to holders of notes issued by
the Company in connection with its acquisition of Putford Enterprises Ltd., (the
"Putford Notes"). In accordance with SFAS 145, the early retirement of the 5
3/8% Notes and the Putford Notes resulted in charges against income from
continuing operations of $966,000 and $2,091,000 for the three and six-month
periods ended June 30, 2003, respectively, that consisted of premium payments
and the write off of related unamortized deferred financing costs and debt
discount.

Effective January 1, 2003, the Company changed its estimated residual value for
newly constructed supply, towing supply and anchor handling towing supply vessel
assets from 10% to 5%. The effect on income of this change in accounting
estimate was not material.

3. COMPREHENSIVE INCOME

For the three-month periods ended June 30, 2003 and 2002, total comprehensive
income was $12,889,000 and $17,397,000, respectively. For the six-month periods
ended June 30, 2003 and 2002, total comprehensive income was $11,216,000 and
$28,647,000, respectively. Other comprehensive income in 2003 and 2002 consisted
of gains and losses from foreign currency translation adjustments and unrealized
holding gains and losses on available-for-sale securities.

4. LONG-TERM DEBT

On February 20, 2003, the Company redeemed all of its then outstanding 5-3/8%
Notes in the aggregate principal amount of $35,319,000. On March 4, 2003, the
Company repaid all of its then outstanding 5.467% Subordinated Promissory Notes
(the "5.467% Notes") in the aggregate principal amount of $23,200,000. On April
7, 2003, the Company repaid all of its then outstanding Putford Notes in the
aggregate principal amount of (pound)7,500,000 or $11,705,000. In addition, the
Company repaid various other promissory notes in the aggregate principal amount
of $1,086,000 during the six-month period ended June 30, 2003.

5. STOCK AND DEBT REPURCHASE PROGRAM

During the six-month period ended June 30, 2003, the Company acquired a total of
1,224,640 shares of its common stock for treasury at an aggregate cost of
$45,351,000. On May 14, 2003, the Company's Board of Directors increased its
authorization for security repurchases, and as of June 30, 2003, approximately
$42,336,000 of such authority remains available for future purchases. The
Company may repurchase its common stock, its 7.2% Senior Notes due 2009 (the
"7.2% Notes") and its 5-7/8% Senior Notes due 2012 (the 5-7/8% Notes") through
open market purchases, privately negotiated transactions or otherwise, depending
on market conditions.

6. EARNINGS PER SHARE

Basic earnings per share were computed based on the weighted average number of
common shares issued and outstanding during the relevant periods. Diluted
earnings per share were computed based on the weighted average number of common
shares issued and outstanding plus all potentially dilutive common shares that
would have been outstanding in the relevant periods assuming the vesting of
restricted stock grants and the issuance of common shares for stock options and
convertible subordinated notes through the application of the treasury stock and
if-converted methods. Diluted earnings per share exclude certain options and
share awards totaling 369,385 and 391,135 for the three and six-month periods
ended June 30, 2003, respectively, and 53,600 and 51,600 for the three and
six-month periods ended June 30, 2002, respectively, as the effect of their
inclusion in the computation would have been antidilutive.

For the Three Months Ended For the Six Months Ended
June 30, June 30,
--------------------------------------- ---------------------------------------
Per Per
Income Shares Share Income Shares Share
-------------- --------------- -------- -------------- --------------- --------

2003
- ----
BASIC EARNINGS PER SHARE:
Net income...............................$ 6,443,000 19,155,421 $ 0.34 $ 10,787,000 19,463,596 $ 0.55
======== ========
EFFECT OF DILUTIVE SECURITIES, NET OF TAX:
Options and restricted stock............. - 160,396 - 162,275
Convertible securities................... - - 167,000 208,436
-------------- --------------- -------------- ---------------
DILUTED EARNINGS PER SHARE:
Income available to common stockholders
plus assumed conversions..............$ 6,443,000 19,315,817 $ 0.33 $ 10,954,000 19,834,307 $ 0.55
============== =============== ======== ============== =============== ========
2002
- ----
BASIC EARNINGS PER SHARE:
Net income...............................$ 12,248,000 20,078,231 $ 0.61 $ 23,654,000 20,058,824 $ 1.18
======== ========
EFFECT OF DILUTIVE SECURITIES, NET OF TAX:
Options and restricted stock............. - 262,522 - 261,987
Convertible securities................... 433,000 1,052,719 865,000 1,052,723
-------------- --------------- -------------- ---------------
DILUTED EARNINGS PER SHARE:
Income available to common stockholders
plus assumed conversions..............$ 12,681,000 21,393,472 $ 0.59 $ 24,519,000 21,373,534 $ 1.15
============== =============== ======== ============== =============== ========

7. STOCK COMPENSATION

Under SFAS 123, companies could either adopt a "fair valued based method" of
accounting for the award of an employee stock option, as defined, or continue to
use accounting methods as prescribed by APB Opinion No. 25. The Company has
elected to continue accounting for its plan under APB Opinion No 25 and,
accordingly, no related expense is reflected in net income. Had compensation
costs for the plan been determined using a "fair valued based method" consistent
with SFAS 123, the Company's net income and earnings per share would have been
reduced to the following pro forma amounts for the three and six-month periods
ended June 30, 2003, and 2002:

For the Three Months For the Six Months
Ended June 30, Ended June 30,
------------------------------- -------------------------------
As Reported Pro forma As Reported Pro forma
--------------- --------------- --------------- ---------------

2003:
Net income................................ $ 6,443,000 $ 6,178,000 $ 10,787,000 $ 10,257,000

Earnings per common share:
Basic.................................. 0.34 0.32 0.55 0.53
Diluted................................ 0.33 0.32 0.55 0.53

2002:
Net income................................ 12,248,000 11,735,000 23,654,000 22,656,000

Earnings per common share:
Basic.................................. 0.61 0.58 1.18 1.13
Diluted................................ 0.59 0.57 1.15 1.10

The effects of applying a "fair valued based method" consistent with SFAS 123 in
this pro forma disclosure are not indicative of future events and additional
awards in the future are anticipated.

8. COMMITMENTS AND CONTINGENCIES

Future capital expenditures, based upon the Company's commitments at June 30,
2003, to purchase 11 newly constructed offshore support vessels, 210 newly
constructed inland river hopper barges, and 7 newly constructed helicopters will
approximate $129,000,000. Deliveries to the Company of newly constructed vessels
and barges are expected over the next 18 months. The newly constructed
helicopters are projected for delivery to the Company through 2005. In addition,
the Company has obtained options to purchase 11 additional newly constructed
helicopters and up to 200 additional newly constructed inland river hopper
barges.

Subsequent to June 30, 2003, the Company contracted for the construction of an
additional offshore support vessel for an approximate aggregate cost of
$4,800,000.

In connection with an examination of the Company's income tax return for fiscal
year 2001, the Internal Revenue Service (IRS) has indicated that it may assert a
deficiency in the amount of taxes paid based on the manner in which vessel
assets were classified for the purpose of depreciation. If the IRS were able to
sustain its position, the Company would be required to pay currently certain
amounts, which have not yet been determined, that are currently reported as
long-term deferred tax obligations. Other than a potential charge for interest
related to any such deficiencies, the final resolution of this matter should not
have an effect on the Company's results of operations. The Company intends to
vigorously defend its position and to contest any deficiency that may be
asserted.

9. SEGMENT INFORMATION

Accounting standards require public business enterprises to report information
about each of their operating business segments that exceed certain quantitative
thresholds or meet certain other reporting requirements. Operating business
segments have been defined as a component of an enterprise about which separate
financial information is available and is evaluated regularly by the chief
operating decision maker in deciding how to allocate resources and in assessing
performance. The Company's basis of segmentation and its basis of measurement of
segment profit have not changed from those previously described in the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 2002, except
as described in Note 2 herein.

The Company's most significant business segment, offshore marine services, is
primarily engaged in the operation of a diversified fleet of offshore support
vessels serving oil and gas exploration and development activities in the U.S.
Gulf of Mexico, the North Sea, West Africa, Asia, Latin America and other
international regions. The Company's vessels deliver cargo and personnel to
offshore installations, handle anchors for drilling rigs and other marine
equipment, support offshore construction and maintenance work, provide standby
safety services, and support the Company's environmental service segment's oil
spill response activities. From time to time, vessels service special projects,
such as well stimulation, seismic data gathering and freight hauling. In
addition to vessel services, the Company's offshore marine services business
offers logistics services, which include shorebase, marine transport and other
supply chain management services also in support of offshore oil and gas
exploration and development operations.

The Company's environmental services segment provides contractual oil spill
response and other services, both domestically and internationally, to those who
store, transport, produce or handle petroleum and certain non-petroleum oils, as
required by the Oil Pollution Act of 1990, as amended ("OPA 90"), various state
regulations and the United Nations' MARPOL 73/78 regulations. Services include
training, consulting and supervision for emergency preparedness, response and
crisis management associated with oil or hazardous material spills, fires and
natural disasters and maintaining specialized equipment for immediate deployment
in response to spills and other events. The Company maintains relationships with
numerous environmental sub-contractors to assist with response operations,
equipment maintenance and provide trained personnel for deploying equipment in a
spill response. When oil spills occur, the Company mobilizes specialized oil
spill response equipment, using either its own personnel or personnel under
contract, to provide emergency response services for both land and marine oil
spills. The Company's clients include tank vessel owner/operators, refiners and
terminal operators, exploration and production facility operators, and pipeline
operators. In accordance with SFAS 131, the Company's environmental services
segment has been separately reported in the segment information presented below
due to its recent improvement in operating results. Certain reclassifications of
prior period information have been made to conform to the current period's
reportable segment presentation.

Other business segments of the Company include inland river hopper barge
operations, offshore aviation services and equity in earnings of 50% or less
owned companies unrelated to the offshore marine services and environmental
services segments. The Company's offshore aviation services segment commenced
operations on December 31, 2002 with the acquisition of Tex-Air Helicopters,
Inc. The Company reported its equity in the earnings of Chiles Offshore Inc.
("Chiles"), an owner and operator of jackup drilling rigs, until Chiles' merger
with ENSCO International Incorporated ("ENSCO") on August 7, 2002 (the "Chiles
Merger").

Offshore Other
Marine Environmental Business
FOR THE THREE MONTHS ENDED JUNE 30, 2003 Services Services Segments Total
- ------------------------------------------------------------- ------------- -------------- -------------- ------------

OPERATING REVENUES :
External customers.......................................... $ 79,547 $ 15,537 10,075 $ 105,159
Intersegment................................................ 6 14 391 411
------------- -------------- -------------- ------------
$ 79,553 $ 15,551 10,466 105,570
============= ============== ==============
Elimination................................................. (411)
------------
$ 105,159
============
REPORTABLE SEGMENT PROFIT:
Operating profit............................................ $ 5,286 $ 5,131 1,000 $ 11,417
Income (loss) from equipment sales and retirements, net..... 583 82 (251) 414
Equity in earnings (losses) of 50% or less owned companies.. 604 5 (287) 322
Other, net.................................................. 1,707 - (1,190) 517
------------- -------------- -------------- ------------
$ 8,180 $ 5,218 (728) 12,670
============= ============== ==============
RECONCILIATION TO INCOME BEFORE INCOME TAXES,
MINORITY INTEREST AND EQUITY EARNINGS:
Interest expense........................................... (4,419)
Interest income............................................ 1,870
Debt extinguishment........................................ (966)
Derivative income, net..................................... 2,624
Gains from sale of marketable securities, net.............. 1,411
Corporate expenses......................................... (2,779)
Other, net................................................. (131)
Equity in earnings of 50% or less owned companies.......... (322)
------------
$ 9,958
============
FOR THE THREE MONTHS ENDED JUNE 30, 2002
- -------------------------------------------------------------

OPERATING REVENUES :
External customers.......................................... $ 90,681 $ 4,953 2,036 $ 97,670
Intersegment................................................ 67 - - 67
------------- -------------- -------------- ------------
$ 90,748 $ 4,953 2,036 97,737
============= ============== ==============
Elimination................................................. (67)
------------
$ 97,670
============
REPORTABLE SEGMENT PROFIT:
Operating profit............................................ $ 11,545 $ 158 354 $ 12,057
Income from equipment sales and retirements, net............ 938 - - 938
Equity in earnings of 50% or less owned companies........... 2,092 (11) (866) 1,215
Other, net.................................................. 6,411 - - 6,411
------------- -------------- -------------- ------------
$ 20,986 $ 147 (512) 20,621
============= ============== ==============
RECONCILIATION TO INCOME BEFORE INCOME TAXES,
MINORITY INTEREST AND EQUITY EARNINGS:
Interest expense........................................... (3,796)
Interest income............................................ 2,102
Derivative income, net..................................... 1,404
Gains from sale of marketable securities, net.............. 487
Corporate expenses......................................... (2,319)
Equity in earnings of 50% or less owned companies.......... (1,215)
------------
$ 17,284
============

Offshore Other
Marine Environmental Business
FOR THE SIX MONTHS ENDED JUNE 30, 2003 Services Services Segments Total
- ------------------------------------------------------------- ------------- -------------- -------------- ------------

OPERATING REVENUES :
External customers.......................................... $ 160,650 $ 21,661 19,708 $ 202,019
Intersegment................................................ 11 27 728 766
------------- -------------- -------------- ------------
$ 160,661 $ 21,688 20,436 202,785
============= ============== ==============
Elimination................................................. (766)
------------
$ 202,019
============
REPORTABLE SEGMENT PROFIT:
Operating profit............................................ $ 8,599 $ 4,732 1,736 $ 15,067
Income (loss) from equipment sales and retirements, net..... 5,890 82 (411) 5,561
Equity in earnings (losses) of 50% or less owned companies.. 1,154 3 (589) 568
Other, net.................................................. 2,245 - (1,190) 1,055
------------- -------------- -------------- ------------
$ 17,888 $ 4,817 (454) 22,251
============= ============== ==============
RECONCILIATION TO INCOME BEFORE INCOME TAXES,
MINORITY INTEREST AND EQUITY EARNINGS:
Interest expense........................................... (9,925)
Interest income............................................ 4,426
Debt extinguishment........................................ (2,091)
Derivative income, net..................................... 4,373
Gains from sale of marketable securities, net.............. 3,602
Corporate expenses......................................... (5,384)
Other, net................................................. (131)
Equity in earnings of 50% or less owned companies.......... (568)
------------
$ 16,553
============
FOR THE SIX MONTHS ENDED JUNE 30, 2002
- -------------------------------------------------------------

OPERATING REVENUES :
External customers.......................................... $ 186,255 $ 10,518 4,540 $ 201,313
Intersegment................................................ 134 - - 134
------------- -------------- -------------- ------------
$ 186,389 $ 10,518 4,540 201,447
============= ============== ==============
Elimination................................................. (134)
------------
$ 201,313
============
REPORTABLE SEGMENT PROFIT:
Operating profit............................................ $ 33,408 $ 326 1,011 $ 34,745
Income from equipment sales and retirements, net............ 3,236 1 - 3,237
Equity in earnings of 50% or less owned companies........... 3,313 (25) (650) 2,638
Other, net.................................................. 3,262 - (11) 3,251
------------- -------------- -------------- ------------
$ 43,219 $ 302 350 43,871
============= ============== ==============
RECONCILIATION TO INCOME BEFORE INCOME TAXES,
MINORITY INTEREST AND EQUITY EARNINGS:
Interest expense........................................... (7,797)
Interest income............................................ 3,969
Derivative income, net..................................... 632
Losses from sale of marketable securities, net............. (678)
Corporate expenses......................................... (4,756)
Equity in earnings of 50% or less owned companies.......... (2,638)
------------
$ 32,603
============

10. NEW ACCOUNTING PRONOUNCEMENTS

In January 2003, the Financial Accounting Standards Board issued Interpretation
No. 46 "Consolidation of Variable Interest Entities, an Interpretation of ARB
No. 51." This interpretation provides guidance on the identification of, and the
financial reporting for, variable interest entities, as defined. Consolidation
of variable interest entities is required under FIN 46 only when a company will
absorb a majority of the variable interest entity's expected losses, receive a
majority of the variable interest entity's expected residual returns, or both.
This interpretation applies immediately to a variable interest entity created or
acquired after January 31, 2003. For variable interest entities acquired before
February 1, 2003, this interpretation applies in the first fiscal year or
interim period beginning after June 15, 2003. The Company has not completed its
assessment of the impact of this interpretation.

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

Certain statements discussed in Item 2 (Management's Discussion and Analysis of
Financial Condition and Results of Operations), Item 3 (Quantitative and
Qualitative Disclosures About Market Risk) and elsewhere in this Form 10-Q
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
concerning Management's expectations, strategic objectives, business prospects,
anticipated economic performance and financial condition and other similar
matters involve known and unknown risks, uncertainties and other important
factors that could cause the actual results, performance or achievements of
results to differ materially from any future results, performance or
achievements discussed or implied by such forward-looking statements. Such
risks, uncertainties and other important factors include, among others: general
economic and business conditions, the cyclical nature of our business, adequacy
of insurance coverage, currency exchange fluctuations, changes in foreign
political, military and economic conditions, the ongoing need to replace aging
vessels, dependence of spill response revenue on the number and size of spills
and upon continuing government regulation in this area and our ability to comply
with such regulation and other governmental regulation, industry fleet capacity,
changes in foreign and domestic oil and gas exploration and production activity,
competition, regulatory initiatives, customer preferences, marine-related risks,
effects of adverse weather conditions and seasonality on the Company's offshore
aviation business, helicopter related risks, effects of adverse weather and
river conditions and seasonality on inland river operations, the level of grain
export volume, variability in freight rates for inland river barges and various
other matters, many of which are beyond the Company's control and other factors
as are described at the end of Item 7 (Management's Discussion and Analysis of
Financial Condition and Results of Operations) of the Company's Form 10-K for
the fiscal year ended December 31, 2002. The words "estimate," "project,"
"intend," "believe," "plan" and similar expressions are intended to identify
forward-looking statements. Forward-looking statements speak only as of the date
of the document in which they are made. We disclaim any obligation or
undertaking to provide any updates or revisions to any forward-looking statement
to reflect any change in our expectations or any change in events, conditions or
circumstances on which the forward-looking statement is based.

OVERVIEW

Through its subsidiaries and joint venture arrangements, the Company's principal
business segment is primarily dedicated to operating a diversified fleet of
offshore support vessels that service oil and gas exploration and production
facilities mainly in the U.S. Gulf of Mexico, the North Sea, Latin America, West
Africa and Asia. The Company's vessels deliver cargo and personnel to offshore
installations, handle anchors for drilling rigs and other marine equipment,
support offshore construction and maintenance work and provide standby safety
support and oil spill response services. From time to time, vessels service
special projects, such as well stimulation, seismic data gathering and freight
hauling. In addition to vessel services, the Company's offshore marine service
business offers logistics services, which include shorebase, marine transport
and other supply chain management services also in support of offshore oil and
gas exploration and production operations.

Other business segments of the Company include inland river hopper barge
operations, offshore aviation services and investments in various other
businesses.

OFFSHORE MARINE SERVICES

The Company's offshore marine service segment provides marine transportation,
logistics and related services primarily dedicated to supporting oil and gas
exploration and production.

Since its inception, the Company has actively monitored opportunities to buy and
sell vessels to maximize the overall utility and flexibility of its fleet. Fleet
growth has occurred principally through the purchase of vessels from
competitors, expansion of equity holdings in joint ventures that own and
charter-in vessels and from the construction of new equipment. In support of
fleet expansion, the Company has deposited proceeds from many of its vessel
sales into construction reserve fund accounts for the express purposes of
acquiring newly constructed U.S.-flag vessels in order to qualify for deferral
of taxable gains realized from the vessel sales.

The offshore marine service segment's operating revenues are influenced
primarily by the number of vessels owned and bareboat and time chartered-in by
the Company, rates per day worked and utilization of the Company's fleet.
Utilization for a vessel over a period of time is the ratio of number of days
worked by the vessel to the total calendar days available during such period.
The rate per day worked for a vessel over a period of time is the ratio of
aggregate time charter revenue earned by the vessel to the number of days worked
by such vessel during the period.

Rates per day worked and utilization of the Company's fleet are a function of
demand for and availability of marine vessels, which are closely aligned with
the level of exploration and development of offshore areas. Exploration and
drilling activities are influenced by a number of factors, including the current
and anticipated future prices of oil and natural gas, the expenditures by oil
and gas companies for exploration and development and the availability of
drilling rigs. In addition, demand for drilling services remains dependent on a
variety of political and economic factors that are also beyond the Company's
control, including worldwide demand for oil and natural gas driven by economic
activity, the ability of the Organization of Petroleum Exporting Countries
("OPEC") to set and maintain production levels and pricing, the level of
production of non-OPEC countries and the policies of various governments
regarding exploration and development of their oil and natural gas reserves.

Depressed offshore rig utilization that existed for all of 2002 has continued
into the first six months of 2003 due to reduced exploration activities,
particularly in the U.S. Gulf of Mexico. Drilling activity has traditionally
been linked to the cash flow of oil and gas companies, which is directly related
to oil and natural gas commodity prices. High oil and natural gas prices have
historically resulted in greater drilling activity, which increases the demand
for the Company's services. However, the strong cash flows reported by oil and
gas companies in 2003 have yet to produce an increase in drilling activity. The
Company has experienced less demand for offshore services in the first two
quarters of 2003 than during the same period in 2002.

The table below sets forth rates per day worked and utilization data for the
Company's offshore marine fleet during the periods indicated.

Three Months Ended Six Months Ended
June 30, June 30,
---------------------------- ----------------------------
2003 2002 2003 2002
------------- -------------- ------------- --------------

RATES PER DAY WORKED ($): (1) (2)
Anchor Handling Towing Supply...................... 12,258 12,103 12,103 12,624
Crew............................................... 3,153 3,224 3,156 3,259
Geophysical, Freight and Other(3).................. - - - -
Mini-Supply........................................ 3,027 2,749 3,063 2,743
Standby Safety..................................... 6,559 5,726 6,549 5,568
Supply and Towing Supply........................... 7,648 7,964 7,681 7,975
Utility and Line Handling.......................... 1,792 1,744 1,780 1,748

OVERALL UTILIZATION (%): (1) (4)
Anchor Handling Towing Supply...................... 76.7 79.1 79.7 83.1
Crew............................................... 79.9 81.8 79.4 83.6
Geophysical, Freight and Other(3).................. - - - -
Mini-Supply........................................ 89.4 85.9 88.1 85.7
Standby Safety..................................... 89.5 84.8 85.5 86.3
Supply and Towing Supply........................... 81.6 89.0 80.7 88.9
Utility and Line Handling.......................... 56.7 62.3 55.9 60.9
Overall Fleet.............................. 77.8 79.1 77.0 79.9

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

(1) Rates per day worked and overall utilization figures exclude owned vessels
that are bareboat chartered-out, minority-owned joint venture vessels and
managed vessels and include vessels bareboat and time chartered-in by the
Company.

(2) Revenues for certain of the Company's vessels included in the calculation
of rates per day worked, primarily its North Sea fleet, are earned in
foreign currencies, primarily Pounds Sterling, and have been converted to
U.S. dollars at the weighted average exchange rate for the periods
indicated.

(3) Vessels in this class were out of service during the reported periods.

(4) Statistics exclude vessels retired from service in the applicable periods,
comprised of 14 utility vessels at June 30, 2003.

From time to time, the Company bareboat or time charters-in vessels. A bareboat
charter is a vessel lease under which the charterer (i.e., the lessee) is
responsible for all crewing, insurance and other operating expenses, as well as
the payment of bareboat charter hire to the providing entity. A time charter is
a lease under which the entity providing the vessel is responsible for all
crewing, insurance and other operating expenses and the charterer pays only a
time charter hire fee to the providing entity. Operating revenues for vessels
owned and bareboat or time chartered-in are earned at similar rates. However,
operating expenses associated with vessels that are bareboat and time
chartered-in include charter hire expenses that, in turn, are included in vessel
expenses, but exclude depreciation expense.

The Company earns operating revenues primarily from the time or bareboat
charter-out of vessels, which are owned or bareboat or time chartered-in.
Operating revenues earned from the bareboat charter-out of vessels are generally
lower than for vessels time-chartered out because vessel expenses, normally
recovered through charter revenue, are paid by the charterer under a bareboat
charter. At various times, the Company also manages vessels for other owners and
earns a fee for this service.

The table below sets forth the Company's offshore marine fleet structure at the
dates indicated:

At June 30,
-------------------------------
Fleet Structure 2003 2002
- --------------------------------------------- --------------- ---------------
DOMESTIC:
Owned................................... 110 126
Bareboat Chartered-In(1)................ 31 26
Joint Venture(2)........................ 3 3

FOREIGN:
Owned................................... 80 88
Bareboat Chartered-In................... 4 3
Managed................................. 5 7
Joint Venture(2)........................ 50 53
--------------- ---------------
Total Fleet........................ 283(3) 306(3)
=============== ===============

- -----------------------
(1) Resulting primarily from sale and leaseback transactions of prior periods.

(2) Of joint venture vessels at June 30, 2003, 48 participated in joint
ventures in which the Company owned less than a majority interest and 5
participated in joint ventures in which the Company owned the majority
interest.

(3) Fleet count at June 30, 2003 and 2002 excludes 14 and 13 utility vessels,
respectively, that have been retired from service.

Vessel operating expenses are primarily a function of fleet size, fleet
composition and vessel utilization. The most significant vessel operating
expense items are wages paid to marine personnel, maintenance and repairs and
marine insurance. Maintenance and repair expenses, including drydocking and main
engine overhaul, are expected to rise over time as the mix of vessels in our
fleet trends toward larger, more powerful equipment in response to the changing
needs of the customers that we serve and challenges of the markets in which we
compete. In addition to variable vessel operating expenses, the offshore marine
service segment incurs fixed charges related to the depreciation of property and
equipment and charter-in hire costs. Depreciation is a significant operating
expense; vessel depreciation is the most significant component.

Drydocking repairs, which are a substantial component of a vessel's maintenance
costs, are expensed when incurred. Under applicable maritime regulations,
vessels must be drydocked twice in a five-year period for inspection by
regulatory authorities. The Company follows an asset management strategy
pursuant to which it defers drydocking of selected vessels during periods of
weak market conditions and low rates per day worked. Should the Company
undertake a large number of drydockings in a particular quarter or put through
survey a disproportionate number of older and/or larger vessels, which typically
have higher drydocking costs, comparative results may be affected. For the
six-month periods ended June 30, 2003 and 2002, drydocking costs totaled $5.1
million and $7.7 million, respectively. During those same periods, the Company
completed the drydocking of 34 and 41 vessels, respectively.

The number of main propulsion engine overhauls performed in a period
particularly affects engine repair expenses, which are also a significant
component of the Company's vessel maintenance costs. In recent years, the
Company has begun to replace older vessels with newer vessels that have more
powerful main propulsion engines. This altered fleet mix has occurred primarily
through the Company's introduction of new aluminum-constructed Fast Support
Intervention Vessels, the main propulsion engines of which are as large as 9,000
horsepower, exceeding the horsepower of older crew vessels that they replaced by
as much as 7,000 horsepower. Should engine repair expenses, particularly those
related to main engine overhauls, increase in a quarter, comparative results may
be affected. For the six-month periods ended June 30, 2003 and 2002, main
propulsion engine repair expenses totaled $6.9 million and $7.3 million,
respectively.

The Company believes that the continuing threat of international terrorist
activity and economic and political uncertainties have resulted in significant
increases in its cost to insure against liabilities to other parties and damage
to its vessels and other property. In the six-month period ended June 30, 2003,
overall insurance expenses have not risen as compared to the six-month period
ended June 30, 2002 as lower deductible costs, resulting from fewer insurance
claims, have offset higher premium costs. However, the combined effect of rising
insurance premiums and an increase in deductible expenses during the third and
fourth quarters of 2003 would result in higher operating expenses. There can be
no assurance that in the future the Company will be able to maintain its
existing coverage or that it will not experience further substantial increases
in premiums.

At June 30, 2003, the Company had 30 vessels bareboat chartered-in pursuant to
sale and leaseback transactions that have been accounted for as operating leases
for financial reporting purposes. Income realized from the sale component of
these transactions has been deferred to the extent of the present value of
minimum lease payments and is being amortized to income as reductions in rental
expense over the applicable lease terms. Charter-in expense, net of deferred
income amortization, resulting from sale and leaseback transactions totaled $7.1
million and $6.4 million in each of the six-month periods ending June 30, 2003
and 2002, respectively.

At June 30, 2003, 14 of the Company's utility vessels were considered retired
from service and are being marketed for sale. These vessels range in length from
96 feet to 120 feet, average 24 years of age and had an aggregate carrying value
of $0.9 million at June 30, 2003. Vessels retired from service have been
excluded from the Company's utilization statistics and fleet counts.

A portion of the Company's revenues and expenses, primarily related to its North
Sea operations, are received or paid in foreign currencies, primarily pounds
sterling. For financial reporting purposes, these amounts are translated into
U.S. dollars at the weighted average exchange rates during the relevant period.
Overall, approximately 55% of the Company's offshore marine operating revenues
was derived from foreign operations (in U.S. dollars or foreign currencies) in
the six-month period ended June 30, 2003.

The Company's foreign offshore marine operations are subject to various risks
inherent in conducting business in foreign nations. These risks include, among
others, political instability, potential vessel seizure, nationalization of
assets, terrorist attacks, fluctuating currency values, hard currency shortages,
controls of currency exchange, the repatriation of income or capital,
import-export quotas and other forms of public and governmental regulation, all
of which are beyond the control of the Company. Although, historically, the
Company's operations have not been affected materially by such conditions or
events, it is not possible to predict whether any such conditions or events
might develop in the future. The occurrence of any one or more of such
conditions or events could have a material adverse effect on the Company's
financial condition and results of operations.

Operating results are also affected by the Company's participation in various
joint ventures. The Company has formed or acquired interests in offshore marine
joint ventures with various third parties in order to enter new areas of
operation and enhance its marketing capabilities. These arrangements allow the
Company to expand its fleet while diversifying the risks and reducing the
capital outlays associated with independent fleet expansion. The Company also
owns a majority interest in a logistics joint venture whose mission has been to
provide shorebase, marine transport and other supply chain management services
in support of offshore exploration and production operations, principally in the
U.S. Gulf of Mexico.

ENVIRONMENTAL SERVICES

The Company's environmental services business provides contractual oil spill
response and other services, both domestically and internationally, to companies
that store, transport, produce or handle petroleum and certain non-petroleum
oils, as required by the Oil Pollution Act of 1990, as amended, various state
regulations and the United Nations' MARPOL 73/78 regulations. Services include
training, consulting and supervision for emergency preparedness, response and
crisis management associated with oil or hazardous material spills, fires and
natural disasters and maintaining specialized equipment for immediate deployment
in response to spills and other events.

The Company charges a retainer fee to its customers for ensuring by contract the
availability (at predetermined rates) of its response services and equipment.
Spill response revenues and related operating profits are dependent on the
magnitude and the number of spill responses within a given period. Consequently,
spill response revenues and operating profits are subject to material variation
between comparable periods, and the revenues from any one period is not
indicative of a trend or of anticipated results in future periods. The Company
also charges consulting fees to customers for developing customized training
programs, planning and participating in customer oil spill response drill
programs and response exercises as well as other special projects.

Operating costs for environmental services primarily include salaries and
related benefits for operating personnel, payments to sub-contractors, equipment
maintenance and depreciation. These expenses are primarily a function of
regulatory requirements and the level of retainer business.

INLAND RIVER BUSINESS

The Company's inland river business earns operating revenues primarily from
voyage affreightments under which customers are charged for a committed space to
transport cargo for a specific time from a point of origin to a destination at
an established price per ton of cargo transported. The Company also earns
operating revenues while cargo is stored aboard barges and when barges are
chartered-out to third parties. Barge operating expenses are typically
differentiated between those directly related to voyages and all other barge
operating costs. Voyage operating expenses primarily include towing, switching,
fleeting and cleaning costs; whereas, non-voyage operating expenses include such
costs as repairs, insurance and depreciation.

A majority of the barges owned by the Company and certain of those managed for
third parties participate in two pooling arrangements. Pursuant to these pooling
arrangements, operating revenues and voyage expenses are pooled, and the net
results are allocated to each participating barge owner.

At June 30, 2003, the Company controlled 559 barges, including 326 directly
owned, 11 owned by a 50% owned partnership and 222 managed for third parties.
Following June 30, 2003, 16 owned, 5 owned by the 50% owned partnership and 4
managed barges were sold.

OFFSHORE AVIATION SERVICES

The Company's offshore aviation services business derives the majority of its
operating revenues from helicopter transportation services provided primarily to
oil and gas companies operating in the U.S. Gulf of Mexico. The number and type
of helicopters in the Company's fleet and their utilization and rates of hire
are the primary drivers of this business segment's operating revenues. Rates and
utilization are a function of demand for and availability of helicopters, which
are closely aligned with the level of exploration and development of offshore
areas. Exploration and drilling activities are influenced by a number of
factors, including the current and anticipated future prices of oil and natural
gas, the expenditures by oil and gas companies for exploration and development
and the availability of drilling rigs. In addition, demand for drilling services
remains dependent on a variety of political and economic factors that are also
beyond the Company's control, including worldwide demand for oil and natural
gas, the ability of the OPEC to set and maintain production levels and pricing,
the level of production of non-OPEC countries and the policies of various
governments regarding exploration and development of their oil and natural gas
reserves. Operating expenses are primarily a function of fleet size and
utilization levels, and operating expenses primarily consist of wages and
related benefits, insurance, repairs and maintenance and equipment leases.

At June 30, 2003, the Company's offshore aviation services fleet included 36
helicopters, of which 21 helicopters were committed for hire under customer
contracts.

OTHER ACTIVITIES

Other activities primarily relate to the Company's 50% or less equity interest
in a marine telecommunications company, a handy-max bulk carrier joint venture,
and a developer of ship brokerage software that supports the shipping industry.
In addition, the Company made a $6.2 million minority equity investment on March
31, 2003 in a company that designs and manufactures water treatment systems for
sale and lease.

The Company, from time to time, may make other investments in related or
unrelated businesses.

RESULTS OF OPERATIONS

OFFSHORE MARINE SERVICES

OPERATING REVENUES. Operating revenues declined $11.2 million and $25.7 million
in the three and six-month periods ended June 30, 2003, respectively, as
compared to the three and six-month periods ended June 30, 2002. Between
comparable three and six-month periods, operating revenue declines of
approximately (i) $7.0 million and $9.7 million, respectively, resulted from net
vessel dispositions, (ii) $3.7 million and 8.9 million, respectively, resulted
from lower rates per day worked and (iii) $1.8 million and $8.4 million,
respectively, resulted from fewer days worked. Between comparable six-month
periods, operating revenues also declined $1.5 million due to a net increase in
the number of vessels entering bareboat charter-out service upon concluding time
charter-out arrangements. An approximate $1.3 million and $3.1 million increase
in operating revenues between comparable three and six-month periods,
respectively, due to the strengthening of the pound sterling currency relative
to the U.S. dollar partially offset these declines.

Since the beginning of 2002, the Company sold 41 vessels, including 13 vessels
subsequently chartered-in pursuant to sale and lease-back transactions,
terminated the charter-in of 7 vessels and reassigned additional vessels from
time charter-out arrangements to bareboat charter-out service. During this same
time period, 16 vessels were acquired and 4 additional vessels were bareboat
chartered-in. Demand for the Company's fleet declined between comparable
six-month periods, particularly for its vessels operating in the U.S. Gulf of
Mexico.

OPERATING PROFIT. Operating profit decreased $6.3 million and $24.8 million in
the three and six-month periods ended June 30, 2003 as compared to the three and
six-month periods ended June 30, 2002 due primarily to those factors affecting
operating revenues. The decline in six-month results also reflects higher
vessel-related wage, lease and mobilization expenses and administrative-related
severance and information technology costs. Higher vessel wages resulted from
raises in compensation provided certain of the Company's international seamen in
the prior year. Vessel charter-in costs rose as the Company entered into
additional sale and leaseback transactions in the prior year. Mobilization
expenses were higher due to increased costs associated with the relocation of
vessels between operating regions. Employee severance benefit expenses and cost
to enhance information technology systems increased administrative and general
expenses. These expense increases were partially offset by lower drydock costs
resulting from fewer vessels undergoing repair or inspection. Between comparable
quarters, operating costs remained constant; higher crew wage, charter-in and
mobilization expenses were offset by lower drydock and other repair costs.

INCOME FROM EQUIPMENT SALES OR RETIREMENTS, NET. Income from equipment sales or
retirements decreased $0.4 million in the three-month period ended June 30, 2003
as compared to the three-month period ended June 30, 2002 due to a decline in
the number of vessels sold. Income from equipment sales or retirements increased
$2.7 million in the six-month period ended June 30, 2003 as compared to the
six-month period ended June 30, 2002. Income from the sale of four vessels in
2002 was deferred for future recognition pursuant to sale and leaseback
accounting standards. There were no sale and leaseback transactions in 2003
resulting in income deferral.

EQUITY IN EARNINGS OF 50% OR LESS OWNED COMPANIES. Equity earnings decreased
$1.5 million and $2.2 million in the three and six-month periods ended June 30,
2003 as compared to the three and six-month periods ended June 30, 2002 due to
lower profits earned by the Company's joint ventures operating in Asia, the
North Sea and Trinidad. In 2003, two vessels operating in Asia were sold at a
loss; significant repairs were performed on a North Sea joint venture vessel;
and charter activity declined in Trinidad.

OTHER, NET. Other income, primarily net gains from foreign currency
transactions, decreased $4.7 million and $1.0 million in the three and six-month
periods ended June 30, 2003 as compared to the three and six-month periods ended
June 30, 2002. The revaluation of loans due SEACOR by certain of its foreign
subsidiaries, whose functional currency is other than the U.S. dollar, resulted
in lower net foreign currency gains as a strengthening of those foreign
currencies against the U.S. dollar was less significant between comparable
periods.

ENVIRONMENTAL SERVICES

OPERATING REVENUES. Operating revenues increased $10.6 million and $11.2 million
in the three and six-month periods ended June 30, 2003 as compared to the three
and six-month periods ended June 30, 2002 due primarily to spill response, spill
management, containment, and remediation services provided in the second quarter
of 2003 in Iraq. The Company's work in Iraq has continued in July and into
August and may be extended through September at option of our client. The
Company seeks to be retained for additional environmental services in Iraq in
future periods.

OPERATING PROFIT. Operating profits increased $5.0 million and $4.4 million in
the three and six-month periods ended June 30, 2003 as compared to the three and
six-month periods ended June 30, 2002 due primarily to the factors affecting
operating revenues.

OTHER BUSINESS SEGMENTS

OPERATING REVENUES. Operating revenues increased $8.4 million and $15.9 million
in the three and six-month periods ended June 30, 2003 as compared to the three
and six-month periods ended June 30, 2002 due to the Company's commencement of
offshore aviation services and the addition of newly constructed barges to its
fleet.

OPERATING PROFIT. Operating profit increased $0.6 million and $0.7 million in
the three and six-month periods ended June 30, 2003 as compared to the three and
six-month periods ended June 30, 2002. An improvement in profits of the inland
river business due to fleet growth was partially offset by higher towing costs,
resulting from increased fuel costs, and reduced demand for barges. Offshore
aviation operations incurred slight operating losses in the three and six-month
periods ended June 30, 2003.

EQUITY IN EARNINGS (LOSSES) OF 50% OR LESS OWNED COMPANIES. Equity losses
decreased $0.6 million and $0.1 million in the three and six-month periods ended
June 30, 2003 as compared to the three and six-month periods ended June 30,
2002. Results of the Company's marine telecommunication joint venture improved
between years. Results in 2002 included an impairment charge relating to the
Company's investment in a developer of ship brokerage software; there was no
similar charge against earnings in the current year. These improvements in
income were partially offset by the fact that the Company ceased to report
equity in the earnings of Chiles following its merger with ENSCO on August 7,
2002.

OTHER, NET. Other expenses increased $1.2 million in the three and six-month
periods ended June 30, 2003 as compared to the three and six-month periods ended
June 30, 2002. During the second quarter of 2003, the Company recognized an
impairment charge with respect to an investment accounted for using the cost
method.

OTHER

INTEREST INCOME AND INTEREST EXPENSE. Net interest expense increased $0.9
million and $1.7 million in the three and six-month periods ended June 30, 2003
as compared to the three and six-month periods ended June 30, 2002 due primarily
to the "negative spread" associated with carrying additional cash raised by the
Company's sale of its $200.0 million aggregate principal amount 5-7/8% Notes in
the third quarter of 2002.

DEBT EXTINGUISHMENT. On February 20, 2003, the Company redeemed all of its then
outstanding 5-3/8% Notes and on April 7, 2003 repaid the Putford Notes that
resulted in the recognition of debt extinguishment expense, totaling $2.1
million.

DERIVATIVE INCOME (LOSSES), NET. Net income from derivative transactions
increased $1.2 million and $3.7 million in the three and six-month periods ended
June 30, 2003, respectively, as compared to the three and six-month periods
ended June 30, 2002. Losses resulting from natural gas and crude oil swaps, U.S.
treasury note and bond options, and futures contracts declined between
comparable three and six-month periods. Six-month results additionally improved
with respect to the revaluation of interest rate swap and costless collar
agreements.

GAINS (LOSSES) FROM SALE OF MARKETABLE SECURITIES, NET. Net gains from the sale
of marketable securities increased $0.9 million and $4.3 in the three and
six-month periods ended June 30, 2003, respectively, as compared to the three
and six-month periods ended June 30, 2002 due to increased equity security sale
gains and reduced net losses on a mark to market basis of equity security short
sales.

CORPORATE EXPENSES. Corporate expenses increased $0.5 million and $0.6 million
in the three and six-month periods ended June 30, 2003, respectively, as
compared to the three and six-month periods ended June 30, 2002 due primarily to
higher legal, information technology and insurance costs.

LIQUIDITY AND CAPITAL RESOURCES

CASH AND MARKETABLE SECURITIES

During the six-month period ended June 30, 2003, the Company's cash and
investments in available-for-sale securities decreased by $94.1 million to
$431.8 million. Cash and marketable securities at June 30, 2003 included $246.9
million of unrestricted cash and cash equivalents, $77.0 million of
available-for-sale securities and $107.9 million of construction reserve funds.

CASH GENERATION AND DEPLOYMENT

GENERAL. The Company's ongoing liquidity requirements arise primarily from its
need to service debt, fund working capital, acquire, construct or improve
equipment and make other investments. The Company's principal sources of
liquidity are cash flows from operations and borrowings under its revolving
credit facility although, from time to time, it may issue shares of common
stock, preferred stock, debt or a combination thereof, or sell vessels to
finance the acquisition of equipment and businesses or make improvements to
existing equipment. The Company's cash flow levels are determined by the size of
the Company's offshore marine fleet, rates per day worked and overall
utilization of the Company's offshore marine vessels and the operations of its
environmental services, inland river and offshore aviation business segments.

The volatility of oil and gas prices, worldwide economic activity and
development, the level of offshore production and exploration activity and other
factors beyond the Company's control will directly affect the Company's offshore
marine and offshore aviation businesses. A curtailment of drilling activity in
U.S. Gulf of Mexico beginning in March 2001 has adversely affected demand and
rates per day worked for most vessel types in the Company's U.S. offshore marine
fleet. As a result, operating results have declined and, at June 30, 2003, the
Company had 29 vessels out of service. Although oil and natural gas prices have
improved, this has yet to produce an increase in U.S. Gulf of Mexico drilling
activity. The Company cannot predict whether, or to what extent, market
conditions will improve, remain stable or deteriorate. Should present demand and
rates per day worked for the Company's U.S. vessels remain unchanged or further
decline, results of operations and cash flows will be adversely affected.

CASH FLOWS PROVIDED FROM OPERATING ACTIVITIES. Cash flows provided from
operating activities were $15.4 million and $37.9 million in the six-month
periods ended June 30, 2003 and 2002, respectively. Recent declines in operating
cash flows have resulted primarily from lower utilization and rates per day
worked for offshore support vessels.

CASH FLOWS PROVIDED BY OR USED IN INVESTING ACTIVITIES. Net cash flows of $5.1
million were provided by investing activities in the six-month period ended June
30, 2003 as compared to net cash flows of $9.6 million used in investing
activities in the six-month period ended June 30, 2002.

During the six-month period ended June 30, 2003, cash flows were provided by
investing activities primarily from (i) the sale of equipment, primarily
consisting of 13 offshore support vessels that included two large North Sea
anchor handling towing supply vessels, for $71.9 million, (ii) the sale of
available-for-sale securities for $34.3 million and (iii) the receipt of
dividends and promissory note principal repayments from 50% or less owned
companies totaling $3.2 million. These increases in cash flows were partially
offset by uses of cash flows in investing activities primarily to (i) construct
offshore support vessels and inland river barges and acquire other equipment for
$65.0 million, (ii) purchase available-for-sale securities for $21.5 million,
(iii) acquire a minority equity interest in a company that designs and
manufactures water treatment systems for sale or lease and make additional
advances to joint ventures totaling $6.6 million and (iv) increase construction
reserve fund balances by $12.7 million.

During the six-month period ended June 30, 2002, cash flows were used in
investing activities primarily to (i) construct offshore support vessels for
$60.0 million, (ii) increase construction reserve fund balances by $7.9 million
and (iii) acquire available-for-sale securities for $11.6 million. These uses in
cash flows were partially offset by cash flows provided in investing activities
primarily from (i) the sale of 13 offshore support vessels for $53.8 million,
(ii) the sale of available-for-sale securities for $11.0 million and (iii) the
receipt of dividends and promissory note principal repayments from 50% or less
owned companies for $5.6 million.

CASH FLOW USED IN FINANCING ACTIVITIES. Net cash flows of $117.0 million and
$32.9 million were used in financing activities in the six-month periods ended
June 30, 2003 and 2002, respectively.

During the six-month period ended June 30, 2003, cash flows were used in
financing activities primarily to (i) repay $71.3 million of outstanding
indebtedness, including $35.3 million of 5-3/8% Notes, $23.2 million of 5.467%
Notes, $11.7 million of Putford Notes and $1.1 million of other outstanding
indebtedness and (ii) purchase for treasury 1,224,640 shares of common stock at
an aggregate cost of $45.4 million.

During the six-month period ended June 30, 2002, cash flows used in financing
activities primarily repaid $33.7 million of outstanding indebtedness.

CAPITAL EXPENDITURES

Future capital expenditures, based upon the Company's commitments at June 30,
2003, to purchase 11 newly constructed offshore support vessels, 210 newly
constructed inland river hopper barges, and 7 newly constructed helicopters will
approximate $129.0 million. Deliveries to the Company of newly constructed
vessels and barges are expected over the next 18 months. The newly constructed
helicopters are projected for delivery to the Company through 2005. In addition,
the Company has obtained options to purchase 11 additional newly constructed
helicopters and up to 200 additional newly constructed inland river hopper
barges.

Subsequent to June 30, 2003, the Company contracted for the construction of an
additional offshore support vessel for an approximate aggregate cost of $4.8
million.

CREDIT FACILITY

REVOLVING CREDIT FACILITY. Amounts available for future borrowings under the
Company's revolving credit facility totaled $199.8 million at August 5, 2003.

STOCK AND DEBT REPURCHASE PROGRAM

As of June 30, 2003, approximately $42.3 million of authority remains available
for the future purchase of the Company's common stock, its 7.2% Notes and its
5-7/8% Notes. The repurchase of these securities may be conducted from time to
time through open market purchases, privately negotiated transactions or
otherwise, depending on market conditions.

CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

Below is an aggregation of the Company's contractual obligations and commercial
commitments as of June 30, 2003, in thousands of dollars.

Payments Due By Period
-------------------------------------------------------------------
Less than After
Contractual Obligations Total 1 Year 1-3 Years 4-5 Years 5 Years
- ------------------------------------ ---------- ---------- ----------- ---------- ----------

Long-term Debt .................... $ 334,799 $ 116 $ 150 $ 33 $ 334,500
Operating Leases................... 96,025 25,046 34,823 21,032 15,124
Construction Commitments(1)........ 128,844 93,119 35,725 - -
---------- ---------- ----------- ---------- ----------
Total Contractual Cash
Obligations.................... $ 559,668 $ 118,281 $ 70,698 $ 21,065 $ 349,624
========== ========== =========== ========== ==========

Amount of Commitment Expiration Per Period
-------------------------------------------------------------------
Less than Over 5
Other Commercial Commitments Total 1 Year 1-3 Years 4-5 Years Years
- ------------------------------------ ---------- ---------- ----------- ---------- ----------
TMM Joint Venture Guarantee(2)..... $ 5,931 $ 371 $ 829 $ 959 $ 3,772
Pelican Joint Venture Guarantee(3). 1,500 - - 1,500 -
U.S. Joint Venture Guarantee(4).... 5,819 1,177 2,327 2,315 -
Letter of Credit .................. 175 175 - - -
---------- ---------- ----------- ---------- ----------
Total Commercial Commitments.... $ 13,425 $ 1,723 $ 3,157 $ 4,773 $ 3,772
========== ========== =========== ========== ==========

- --------------------
(1) Excludes a $4.8 million commitment to construct an additional vessel made
following quarter end.

(2) Guarantee for non-payment of obligations owing by the Company's Mexican
joint venture under a charter arrangement.

(3) Guarantee of amounts owed by an Asian joint venture under its banking
facilities.

(4) Guarantee for 50% non-payment of obligations owing by the Company's U.S.
joint venture under a charter arrangement.

CONTINGENCIES

NEW ACCOUNTING PRONOUNCEMENTS

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There has been no significant change in the Company's exposure to market risk
during the six-month period ended June 30, 2003, except with the expiration of
certain costless collars that were entered to partially hedge the fluctuation in
market value for part of the Company's common stock position in ENSCO. For
discussion of the Company's exposure to market risk that affects financial
positions other than the Company's equity security portfolio and costless
collars, refer to Item 7A, Quantitative and Qualitative Disclosures about Market
Risk, contained in the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 2002.

In order to partially hedge the fluctuation in market value for part of the
Company's common stock investment in ENSCO acquired in connection with the
Chiles Merger, the Company entered into various transactions (commonly known as
"costless collars") during 2002 with a major financial institution on 1,000,000
shares of ENSCO common stock. The effect of these transactions was that the
Company would be guaranteed a minimum value of approximately $24.35 and a
maximum value of approximately $29.80 per share of ENSCO, at expiration. These
costless collars expired during the second quarter of 2003 and, as the share
value of ENSCO's common stock was between $24.35 and $29.80 at expiration,
neither party had a payment obligation under these transactions.

As of June 30, 2003, the Company held available-for-sale equity securities with
a fair value of $42.5 million, a significant portion of which was shares of
ENSCO received in connection with the Chiles Merger. A 10% decline in the value
of available-for-sale equity securities held by the Company would reduce other
comprehensive income, net of tax, by $2.8 million. The Company monitors these
investments on a regular basis and disposes of investments when it judges the
risk profile to be too high or when it believes that the investments have
reached an attractive valuation.

ITEM 4. CONTROLS AND PROCEDURES

The Company's management evaluated, with the participation of the Company's
principal executive and principal financial officers, the effectiveness of the
Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and
15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), as of June 30, 2003. Based on their evaluation, the Company's principal
executive and principal financial officers concluded that the Company's
disclosure controls and procedures were effective as of June 30, 2003.

There has been no change in the Company's internal control over financial
reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act)
that occurred during the Company's fiscal quarter ended June 30, 2003, that has
materially affected, or is reasonably likely to materially affect, the Company's
internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The annual meeting of stockholders of SEACOR SMIT Inc. was held on April 4,
2003. The following table gives a brief description of each matter voted upon at
that meeting and, as applicable, the number of votes cast for, against or
withheld, as well as the number of abstentions and broker non-votes.

Description of Matter For Against Withheld Abstentions Broker Non-Votes
--------------------- --- ------- -------- ----------- ----------------

1. Election of Directors:
Charles Fabrikant................... 16,589,921 N/A 1,646,530 N/A N/A
Andrew Morse........................ 17,698,273 N/A 538,178 N/A N/A
Michael E. Gellert.................. 18,124,014 N/A 112,437 N/A N/A
Stephen Stamas...................... 17,697,671 N/A 538,780 N/A N/A
Richard M. Fairbanks III............ 18,123,941 N/A 112,510 N/A N/A
Pierre de Demandolx................. 18,124,014 N/A 112,437 N/A N/A
John C. Hadjipateras................ 17,698,273 N/A 538,178 N/A N/A
Oivind Lorentzen.................... 18,124,014 N/A 112,437 N/A N/A
James A.F. Cowderoy................. 16,603,353 N/A 1,633,098 N/A N/A

2. Approval of the SEACOR SMIT Inc.
2003 Non-Employee Director Share
Incentive Plan......................... 15,143,767 994,134 N/A 2,877 2,095,673

3. Approval of the SEACOR SMIT Inc.
2003 Share Incentive Plan.............. 11,138,030 4,987,148 N/A 2,000 2,109,273

4. Ratification of the appointment of
Ernst & Young LLP as the Company's
independent auditors for the fiscal
year ending December 31, 2003.......... 18,173,538 61,894 N/A 1,019 N/A

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

A. Exhibits:

31.1 Certification by the Chief Executive Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.

31.2 Certification by the Chief Financial Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.

32.1 Certification Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.

32.2 Certification Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.

B. Reports on Form 8-K:

(i) Current Report on Form 8-K, dated May 2, 2003, reporting
under Item 9 that, on April 25, 2003, the Company issued a
press release announcing its financial results for the
first quarter ended March 31, 2003.

SIGNATURES

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

SEACOR SMIT Inc.
(Registrant)

DATE: August 14, 2003 By: /s/ Charles Fabrikant
---------------------------------------
Charles Fabrikant, Chairman of the Board,
President and Chief Executive Officer
(Principal Executive Officer)

DATE: August 14, 2003 By: /s/ Randall Blank
---------------------------------------
Randall Blank, Executive Vice President,
Chief Financial Officer and Secretary
(Principal Financial Officer)

EXHIBIT INDEX

31.1 Certification by the Chief Executive Officer Pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.

31.2 Certification by the Chief Financial Officer Pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.

32.1 Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2 Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.