8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 17, 2010

OCEANEERING INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Delaware	1-10945	95-2628227
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
11911 FM 529 Houston, TX		77041
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (713) 329-4500

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On February 17, 2010, we issued a press release announcing our earnings for the fourth quarter and full year of 2009. A copy of that press release is furnished as Exhibit 99.1 to this report and is incorporated by reference herein.

The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be incorporated by reference into any registration statement filed under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.

Item 9.01. Financial Statements and Exhibits.

The following is being furnished as an exhibit to this report.

Exhibit 99.1 Press Release of Oceaneering International, Inc., dated February 17, 2010

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 hereunto duly authorized.

OCEANEERING INTERNATIONAL, INC.
By:	/S/    MARVIN J. MIGURA
	Marvin J. Migura
	Senior Vice President and Chief Financial Officer
	(Principal Financial Officer)

Date: February 17, 2010

Exhibit Index

Exhibit No.	Description
99.1	Press Release issued by Oceaneering International, Inc. on February 17, 2010.

EX-99.1

Exhibit 99.1

Oceaneering Reports Fourth Quarter and Annual Earnings

— Achieves Annual EPS of $3.40, Second Highest in Oceaneering’s History

— Reaffirms 2010 EPS Guidance of $3.25 to $3.55

February 17, 2010 – Houston, Texas – Oceaneering International, Inc. (NYSE:OII) today reported fourth quarter and annual earnings for the periods ended December 31, 2009.

For the fourth quarter of 2009, on revenue of $452.3 million, Oceaneering generated net income of $46.1 million, or $0.83 per share. During the corresponding period in 2008, Oceaneering reported revenue of $525.7 million and net income of $51.0 million, or $0.92 per share. For the year 2009, Oceaneering reported net income of $188.4 million, or $3.40 per share, on revenue of $1.8 billion. Net income for 2008 was $199.4 million, or $3.56 per share, on revenue of nearly $2.0 billion.

Summary of Results

(in thousands, except per share amounts)

	Three months ended						Year Ended
	December 31,				Sept. 30,		December 31,
	2009		2008		2009		2009		2008
Revenue	$	452,262	$	525,691	$	484,036	$	1,822,081	$	1,977,421
Gross Margin		107,734		120,248		114,045		437,726		464,800
Operating Income		72,132		81,626		76,306		292,116		317,558
Net Income	$	46,058	$	51,009	$	49,839	$	188,353	$	199,386
Net Income Attributable to Diluted Common Shares *	$	45,737	$	50,465	$	49,491	$	187,035	$	197,284
Weighted Average Number of Diluted Common Shares *		55,095		54,726		55,058		55,026		55,374
Diluted Earnings Per Share *	$	0.83	$	0.92	$	0.90	$	3.40	$	3.56

* 2008 period amounts have been restated to comply with current accounting rules.

Annual and quarterly net income declined from 2008 as a result of lower operating income performances from Subsea Products, Subsea Projects, and Inspection. ROV operating income performances were record highs for both periods.

Results for the fourth quarter of 2009 included, in Mobile Offshore Production Systems (MOPS) gross margin, a $1.9 million gain on the sale of the Ocean Producer, a recently retired floating production storage and offloading unit. MOPS results in the fourth quarter of 2008 included a $5.7 million impairment charge to reduce our investment in the Ocean Pensador, an oil tanker that was sold in the second quarter of 2009.

T. Jay Collins, President and Chief Executive Officer, stated, “Our earnings of over $188 million were the second highest in Oceaneering’s history and EPS of $3.40 was only 4% below last year’s record results. This was a remarkable accomplishment and particularly gratifying during a time of global economic recession, tight credit markets, and declining oil consumption. Our performance in this environment was largely attributable to increased demand for ROV drill support services and the success of our efforts to control expenses, which enabled us to maintain the operating income margin we realized in 2008.

“We achieved record ROV operating income performance for the sixth consecutive year. Year over year, we grew ROV operating income by increasing our vehicle days on hire and controlling our expenses. During 2009 we put 30 new ROVs into service and retired nine. At year-end we had 248 vehicles in our fleet.

“Compared to 2008, Subsea Products operating income decreased due to demand declines for our specialty subsea products, lower umbilical plant throughput, and unanticipated manufacturing costs we incurred on two BOP control systems. Subsea Projects profit declined due to lower demand for our shallow-water vessel and diving services and competitive pressure in our deepwater vessel market due to an increase in industry vessel availability. Inspection results decreased due to the unfavorable currency impact of a stronger U.S. Dollar relative to the British Pound and lower demand for services.

“In 2009 we continued to take actions to position the company for future growth and increased earnings. Our capital expenditures were $175 million, of which $147 million was spent on growing and upgrading our ROV operations.

“Our balance sheet remained in great shape at year end. We had $162 million of cash, $120 million of debt, $200 million available under our revolving credit facility, and $1.2 billion of equity.

“For 2010 the International Energy Agency forecasts a global surplus supply of oil due to a reduction in demand stemming from the 2009 global economic recession. We therefore anticipate some deepwater construction projects will continue to be deferred until there is a meaningful recovery in hydrocarbon demand. We believe, however, that deepwater drilling activity will keep growing in 2010 as new floating rigs currently under construction are added to the worldwide fleet.

“We are forecasting our 2010 EPS to be relatively flat with 2009, in the range of $3.25 to $3.55. Compared to 2009, our forecast assumptions include unit volume growth and increased operating profit from ROVs, improved operating efficiencies and results for Subsea Products, declines in Subsea Projects activity levels and operating income, and a lower contribution from MOPS, due primarily to the retirement and sale of the Ocean Producer. For the first quarter of 2010, we are forecasting EPS of $0.65 to $0.75.

“For 2010 we anticipate generating in excess of $300 million of cash flow, simply defined as net income plus depreciation and amortization. This projected cash flow will provide ample resources to invest in Oceaneering’s growth.

“Looking longer term, our belief that the oil and gas industry will continue to invest in deepwater to counteract high existing reservoir depletion rates remains unchanged. Deepwater is one of the best frontiers for adding large hydrocarbon reserves with high production flow rates at relatively low per barrel finding and development costs. Therefore, we anticipate demand for our deepwater services and products will remain promising. With our existing assets, we are well positioned to supply a wide range of the services and products required to support the deepwater exploration, development, and production efforts of our customers.”

- more -

Statements in this press release that express a belief, expectation, or intention are forward looking. The forward-looking statements in this press release include the statements concerning Oceaneering’s: anticipation that some deepwater construction projects will continue to be deferred until there is a meaningful recovery in hydrocarbon demand; belief that deepwater drilling activity will keep growing in 2010 as new floating rigs under construction are added to the worldwide fleet; 2010 EPS guidance range of $3.25 to $3.55; 2010 forecast assumptions, including that it will achieve unit volume growth and increased operating profits from ROVs, improved operating efficiencies and results in Subsea Products, declines in Subsea Projects activity levels and operating income, and a lower contribution from MOPS due primarily to the retirement and sale of the Ocean Producer; first quarter 2010 forecasted EPS range of $0.65 to $0.75; anticipation of generating, during 2010, in excess of $300 million of cash flow, as defined, and the expectation that this cash flow will provide ample resources to invest in the company’s growth; belief that the oil and gas industry, over the long term, will continue to increase its investment in deepwater to counteract high existing reservoir depletion rates; anticipation that demand for its deepwater services and products will remain promising; and forecasted EBITDA for 2010 and the related reconciliations thereof to forecasted net income. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are based on current information and expectations of Oceaneering that involve a number of risks, uncertainties, and assumptions. Among the factors that could cause the actual results to differ materially from those indicated in the forward-looking statements are risks and uncertainties related to: industry conditions; prices of crude oil and natural gas; Oceaneering’s ability to obtain, and the timing of, new projects; changes in customers’ operational plans or schedules; contract cancellations or modifications; difficulties executing under contracts; and changes in competitive factors. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the forward-looking statements prove incorrect, actual outcomes could vary materially from those indicated. For a more complete discussion of these and other risk factors, please see Oceaneering’s annual report on Form 10-K for the year ended December 31, 2008 and subsequent quarterly reports on Form 10-Q filed with the Securities and Exchange Commission.

Oceaneering is a global oilfield provider of engineered services and products, primarily to the offshore oil and gas industry, with a focus on deepwater applications. Through the use of its applied technology expertise, Oceaneering also serves the defense and aerospace industries.

For further information, please contact Jack Jurkoshek, Director Investor Relations, Oceaneering International, Inc., 11911 FM 529, Houston, Texas 77041; Telephone 713-329-4670; Fax 713-329-4653; E-Mail investorrelations@oceaneering.com. A live webcast of the Company’s earnings release conference call, scheduled for Thursday, February 18, 2010 at 11:00 a.m. Eastern, can be accessed at www.oceaneering.com/investor-relations/.

OCEANEERING INTERNATIONAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

	Dec. 31, 2009		Dec. 31, 2008
	(in thousands)
ASSETS
Current Assets (including cash and cash equivalents of $162,351 and $11,200)	$	874,139	$	747,705
Net Property and Equipment		766,361		697,430
Other Assets		239,787		224,885
TOTAL ASSETS	$	1,880,287	$	1,670,020
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities	$	388,547	$	357,327
Long-term Debt		120,000		229,000
Other Long-term Liabilities		147,417		116,039
Shareholders’ Equity		1,224,323		967,654
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,880,287	$	1,670,020

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

	For the Three Months Ended									For the Year Ended
	Dec. 31,			Dec. 31,			Sept. 30,			December 31,
	2009			2008			2009			2009			2008
	(in thousands, except per share amounts)
Revenue	$	452,262		$	525,691		$	484,036		$	1,822,081		$	1,977,421
Cost of Services and Products		344,528			405,443			369,991			1,384,355			1,512,621
Gross Margin		107,734			120,248			114,045			437,726			464,800
Selling, General and Administrative Expense		35,602			38,622			37,739			145,610			147,242
Income from Operations		72,132			81,626			76,306			292,116			317,558
Interest Income		181			395			287			694			907
Interest Expense		(1,478	)		(3,603	)		(1,714	)		(7,781	)		(13,485	)
Equity earnings of unconsolidated affiliates, net		825			22			768			3,242			1,919
Other Income (Expense), net		(800	)		597			1,028			1,504			321
Income before income taxes		70,860			79,037			76,675			289,775			307,220
Provision for Income Taxes		24,802			28,028			26,836			101,422			107,834
Net Income	$	46,058		$	51,009		$	49,839		$	188,353		$	199,386
Net Income Attributable to Diluted Common Shares *	$	45,737		$	50,465		$	49,491		$	187,035		$	197,284
Weighted Average Number of Diluted Common Shares*		55,095			54,726			55,058			55,026			55,374
Diluted Earnings per Share *	$	0.83		$	0.92		$	0.90		$	3.40		$	3.56

* 2008 period amounts have been restated to comply with current accounting rules.

The above Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Income should be read in conjunction with the Company’s latest Annual Report on Form 10-K and Quarterly Report on Form 10-Q.

SEGMENT INFORMATION

		For the Three Months Ended									For the Year Ended
		Dec. 31, 2009			Dec. 31, 2008			Sept. 30, 2009			Dec. 31, 2009			Dec. 31, 2008
		($ in thousands)
Remotely Operated Vehicles	Revenue	$	167,580		$	160,253		$	166,010		$	649,228		$	625,921
	Gross margin	$	63,293		$	60,809		$	61,694		$	237,023		$	221,270
	Operating income	$	55,158		$	52,891		$	53,994		$	207,683		$	190,343
	Operating margin %		33	%		33	%		33	%		32	%		30	%
	Days available		22,724			20,649			22,011			86,527			79,052
	Utilization		78	%		82	%		79	%		79	%		82	%
Subsea Products	Revenue	$	124,467		$	171,129		$	132,748		$	487,726		$	649,857
	Gross margin	$	28,331		$	35,356		$	27,798		$	115,056		$	146,747
	Operating income	$	15,093		$	22,189		$	14,054		$	60,526		$	96,046
	Operating margin %		12	%		13	%		11	%		12	%		15	%
	Backlog at end of period	$	321,000		$	298,000		$	328,000		$	321,000		$	298,000
Subsea Projects	Revenue	$	48,627		$	90,312		$	65,861		$	241,393		$	256,517
	Gross margin	$	13,396		$	26,735		$	19,274		$	74,564		$	81,534
	Operating income	$	11,967		$	24,034		$	17,128		$	66,514		$	72,816
	Operating margin %		25	%		27	%		26	%		28	%		28	%
Inspection	Revenue	$	53,739		$	56,253		$	57,582		$	216,140		$	249,109
	Gross margin	$	8,853		$	10,275		$	11,208		$	41,125		$	48,518
	Operating income	$	5,569		$	5,973		$	7,296		$	26,443		$	31,017
	Operating margin %		10	%		11	%		13	%		12	%		12	%
Mobile Offshore Production Systems	Revenue	$	5,067		$	9,389		$	9,960		$	33,214		$	39,274
	Gross margin	$	3,207		$	(2,049	)	$	2,726		$	10,093		$	8,361
	Operating income (loss)	$	3,114		$	(2,418	)	$	2,355		$	8,890		$	6,730
	Operating margin %		61	%		-26	%		24	%		27	%		17	%
Advanced Technologies	Revenue	$	52,782		$	38,355		$	51,875		$	194,380		$	156,743
	Gross margin	$	5,698		$	4,433		$	7,713		$	25,128		$	21,596
	Operating income	$	1,988		$	1,450		$	4,375		$	12,366		$	9,773
	Operating margin %		4	%		4	%		8	%		6	%		6	%
Unallocated Expenses	Gross margin	$	(15,044	)	$	(15,311	)	$	(16,368	)	$	(65,263	)	$	(63,226	)
	Operating income	$	(20,757	)	$	(22,493	)	$	(22,896	)	$	(90,306	)	$	(89,167	)
TOTAL	Revenue	$	452,262		$	525,691		$	484,036		$	1,822,081		$	1,977,421
	Gross margin	$	107,734		$	120,248		$	114,045		$	437,726		$	464,800
	Operating income	$	72,132		$	81,626		$	76,306		$	292,116		$	317,558
	Operating margin %		16	%		16	%		16	%		16	%		16	%
SELECTED CASH FLOW INFORMATION
	Capital expenditures, including acquisitions	$	29,970		$	53,850		$	54,953		$	175,021		$	252,277
	Depreciation and amortization	$	33,433		$	33,022		$	31,798		$	122,945		$	115,029

The above should be read in conjunction with the Company’s latest Annual Report on

Form 10-K and Quarterly Report on Form 10-Q.

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION

		For the Three Months Ended						For the Year Ended
		Dec. 31, 2009		Dec. 31, 2008		Sept. 30, 2009		Dec. 31, 2009		Dec. 31, 2008
		(in thousands)
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
	Net Income	$	46,058	$	51,009	$	49,839	$	188,353	$	199,386
	Depreciation and Amortization		33,433		33,022		31,798		122,945		115,029
	Subtotal		79,491		84,031		81,637		311,298		314,415
	Interest Income/Expense, Net		1,297		3,208		1,427		7,087		12,578
	Provision for Income Taxes		24,802		28,028		26,836		101,422		107,834
	EBITDA	$	105,590	$	115,267	$	109,900	$	419,807	$	434,827
				2010 Estimates
				Low		High
				(in thousands)
	Net Income			$	180,000	$	195,000
	Depreciation and Amortization				135,000		145,000
	Subtotal				315,000		340,000
	Interest Income/Expense, Net				5,000		5,000
	Provision for Income Taxes				95,000		105,000
	EBITDA			$	415,000	$	450,000