commitments to purchase five anchor handling towing supply vessels for a total cost of approximately  $60.6 million at March 31, 2010. In April 2010, the company took possession of three of these five anchor  handling towing supply vessels, and plans to take possession of the fourth and fifth anchor handling towing  supply vessels in May and June of 2010, respectively. At March 31, 2010, the company had invested  $271.9 million in progress payments towards the construction of 31 vessels, and no payments have been  made on the purchase of five anchor handling towing supply vessels. The remaining expenditures  necessary to complete construction of the 31 vessels currently under construction (based on contract  prices) and to fund the acquisition of the five anchor handling towing supply vessels was $470.5 million at  March 31, 2010. A full discussion of the company’s capital commitments, scheduled delivery dates and  vessel sales is disclosed in the “Vessel Count, Dispositions, Acquisitions and Construction Programs”  section of Item 7 and Note 10 of Notes to Consolidated Financial Statements included in Item 8 of this  report. In July 2009, the company’s Board of Directors authorized the company to spend up to $200.0 million to  repurchase shares of its common stock in open-market or privately-negotiated transactions. The company  announced on May 14, 2010 that its Board of Directors has extended this program. The company will use its  available cash and, when considered advantageous, borrowings under its revolving credit facility, or other  borrowings, to fund any share repurchases. The repurchase program was scheduled to expire on  June 30, 2010, but has now been extended to expire on the earlier of the date that all authorized funds have  been expended or June 30, 2011 unless extended by the Board of Directors. No amounts have been  expended under the July 2009 authorized program through March 31, 2010, and at March 31, 2010,  $200.0 million remained available to repurchase shares under the 2009 program until it expires. During  fiscal 2010, the company did not repurchase shares of its common stock. The company will continue to  evaluate share repurchase opportunities relative to other investment opportunities and in the context of its  financial position and then existing conditions in the credit and capital markets The primary driver of our business is our customers’ capital and operating expenditures dedicated to oil and  natural gas exploration, field development and production. Our business is dependent upon our customers’  expectations for future oil and natural gas prices, economic growth, hydrocarbon demand and estimates of  current and future oil and natural gas production. The prices of crude oil and natural gas are critical factors  in exploration and production (E&P) companies’ decisions to contract drilling rigs in the United States (U.S.)  Gulf of Mexico (GOM) market or to contract rigs in international markets. The company’s international  results of operations are primarily dependent on the supply and demand relationship of crude oil; while the  company’s U.S. results of operations are primarily dependent on the supply and demand relationship for  natural gas. During late 2008 and early 2009, prices for crude oil and natural gas fell dramatically from their  respective peaks achieved earlier in calendar year 2008 due to a global recession that caused a precipitous  drop in worldwide demand for oil and gas. During most of calendar year 2009, the global economy weakened, and many E&P customers reduced their  capital spending budgets in response to lower demand and weaker commodity prices. During the  company’s fiscal 2010, the global recession caused demand for offshore support vessel services to decline,  particularly in the shallow waters of the U.S. GOM. This reduced demand has led to an industry-wide  reduction in charter rates and utilization rates on vessels as our customers demanded pricing concessions.  In late calendar 2009 and into 2010, there are some early signs of an economic recovery, although the pace  of recovery has been slow and demand for energy continues to lag. Assessing the current market  environment in the near term is challenging given the tenuous state of the global economy and of financial  and commodity markets. The company is evaluating the current trends in the global economy to determine  how these trends are affecting the development plans of E&P companies and global demand for its offshore  vessels. The company is also evaluating the impact of developments over the last 18 months on the ability  of shipyards to meet their scheduled deliveries of new vessels and the ability of the company to renew its  fleet through new vessel construction and/or acquisitions. In an effort to stabilize falling crude oil prices, OPEC cut approximately 6.8% of crude oil production over the  last 18 months. As calendar year 2009 progressed, oil prices gradually recovered and stabilized in the range  of $80 to $85 per barrel as of mid-April 2010. Although this price range is far below its all time closing high  of approximately $147 per barrel in mid-July 2008, it is significantly higher than the low $30’s price levels  experienced during the first quarter of calendar 2009. To date, OPEC’s market stabilization efforts have  -29-  Macroeconomic Environment and Outlook