UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

AMENDMENT NO. 1

(Mark One)

For the fiscal year ended December 31, 2003

Commission File Number: 0-28316

Trico Marine Services, Inc.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (985) 851-3833

Securities registered pursuant to Section 12(b) of the Act:

None.

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, $0.01 par value per share

Preferred Stock Purchase Rights

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 if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2.)    Yes  x    No  ¨

The aggregate market value of the voting stock held by non-affiliates of the Registrant at June 30, 2003 based on the closing price on NASDAQ National Market on that date was $109,744,438.

The number of shares of the Registrant’s common stock, $0.01 par value per share, outstanding at February 27, 2004 was 36,935,537.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s definitive proxy statement, to be filed electronically no later than 120 days after the end of the fiscal year, are incorporated by reference in Part III.

EXPLANATORY NOTE

This Form 10-K/A of Trico Marine Services, Inc. (together with its subsidiaries collectively referred to as “the Company”, “Trico”, or “we”) is being filed for the purpose of amending and restating Items 6, 7 and 8 of Part II and Item 15 of Part IV of our Form 10-K for the fiscal year ended December 31, 2003, filed March 15, 2004 (the “2003 Form 10-K”), to reflect the restatement of our Consolidated Financial Statements as of and for the years ended December 31, 2003 and 2002 and to update certain information regarding our Norwegian revolving credit facility. We restated our Consolidated Financial Statements as of and for the years ended December 31, 2003 and 2002 to properly classify our Norwegian revolving line of credit as a current liability.

Following the filing of the Company’s Form 10-K for the fiscal year ended December 31, 2003 (the “2003 Form 10-K”), the staff of the Division of Corporation Finance of the Securities and Exchange Commission (the “SEC”) selected the 2003 Form 10-K for review. The SEC commented that Statement of Financial Accounting Standards (“SFAS”) No. 6, “Classification of Short-Term Obligations Expected to be Refinanced – an amendment of ARB No. 43, Chapter 3A” appeared to apply to the Company’s Norwegian Kroner (“NOK”) 800 million revolving credit facility (the “Trico Supply Bank Facility”). After consultations with the staff members of the SEC and a review of the Trico Supply Bank Facility, the SEC advised, and the Company and its auditors agreed that the outstanding balance of the facility should technically be classified as a current liability in accordance with SFAS No. 6 since the facility contains a subjective acceleration clause (material adverse change clause) and the agreement language replaces short-term advances with other short-term advances. Previously, the Company presented the outstanding balance as a long-term liability because the facility has a final maturity of September 2009 and the fact that the Company does not use cash to repay advances on a short-term basis, but instead rolls over an advance into a new advance period. The Company had NOK 410 million outstanding under this facility as of December 31, 2003 ($61.5 million) and NOK 610 million outstanding as of December 31, 2002 ($87.9 million). The Company’s Norwegian operating subsidiary, Trico Shipping AS, is the borrower of this facility. This change in classification does not affect the Company’s compliance with this facility or other currently outstanding debt instruments and does not affect the liquidity position of the Company for any period previously reported.

This amendment to the original Form 10-K amends and restates the original Form 10-K in its entirety. This Form 10-K/A contains no changes to the Consolidated Statements of Operations, Consolidated Statements of Stockholders’ Equity, or Consolidated Statements of Cash Flows as previously reported, although this Form 10-K/A does include changes to the Consolidated Balance Sheets and disclosures as described below:

Part II—Item 6. Selected Financial Information—Balance Sheet Data—Working capital (deficit)—The 2003 amount has been restated to $(27,740) from $33,768 as originally reported. The 2002 amount has been restated to $(69,427) from $18,498 as originally reported.

Part II—Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Added disclosure concerning the reclassification of the Company’s revolving credit facility pursuant to U.S. GAAP regulations, updated the table summarizing contractual commitments, added a discussion of our Norwegian revolving credit facility, and added a reference to Note 4 of the Financial Statements included in Item 8.

Part II—Item 8. Financial Statements and Supplementary Data—Report of Independent Registered Public Accounting Firm—Changes were made to the opinion wording and the opinion date.

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Part II—Item 8. Financial Statements and Supplementary Data—Consolidated Balance Sheets—Liabilities and Stockholder’s Equity—Amounts for current portion of long-term debt, total current liabilities, and long-term debt at December 31, 2003 and 2002 have been restated from amounts originally reported as follows:

Part II—Item 8. Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—3. Restatement—A new footnote describing the reclassification has been added.

Part II—Item 8. Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—4. Subsequent Events—A new footnote describing the Company’s subsequent events has been added.

Part II—Item 8. Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—9. Debt—The heading of the footnote was changed to “Debt”.

Part II—Item 8. Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—9. Debt—The caption reading “Less current maturities”—The 2003 amount has been restated to $66,266 from $4,758 (in thousands) as originally reported. The 2002 amount has been restated to $96,626 from $8,701 (in thousands) as originally reported. The caption reading “Long-term debt”—The 2003 amount has been restated to $313,900 from $375,408 (in thousands) as originally reported. The 2002 amount has been restated to $287,520 from $375,445 (in thousands) as originally reported. Under the caption reading “Annual maturities on long-term debt during the next five years are as follows (in thousands):”—The 2004 amount has been restated to $66,266 from $4,758 as originally stated, the 2005 amount remains at $35,758 as originally stated, the 2006 amount remains at $20,510 as originally stated, the 2007 amount has been restated to $1,258 from $2,758 as originally stated, the 2008 amount has been restated to $1,258 from $13,260 as originally stated, and the Thereafter amount has been restated to $255,116 from $303,122 as originally stated.

Part II—Item 8. Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—9. Debt—In the paragraph discussing the Norwegian revolving credit facility, disclosure concerning the reclassification of the Company’s revolving credit facility pursuant to SFAS No. 6 has been added.

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Part II—Item 8. Financial Statements and Supplementary Data—Notes to Consolidated Financial Statements—20. Condensed Consolidating Financial Statements for Subsidiary Guarantors—Condensed Consolidating Balance Sheets—Amounts for current portion of long-term debt, total current liabilities, and long-term debt for the “Non-Guarantor Subsidiaries” at December 31, 2003 and 2002 have been restated from amounts originally reported as follows:

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PART II

Item 6.    Selected Financial Data

The selected financial data presented below for the five fiscal years ended December 31, 2003 is derived from our audited consolidated financial statements. You should read this information in conjunction with the discussion under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements.

Item 7.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

General

We are a leading provider of marine support vessels to the oil and gas industry, primarily in the U.S. Gulf of Mexico, the North Sea, and Latin America. We have a total fleet of 84 vessels, including 48 supply vessels, 13 large capacity platform supply vessels, six large anchor handling, towing and supply vessels, 11 crew boats and six line-handling vessels. Three of the crew boats are being leased under ten-year operating leases.

Our results of operations are affected primarily by the day rates we receive and our fleet utilization. Demand for our vessels is primarily impacted by the level of offshore oil and gas drilling activity, which historically has been primarily influenced by oil and gas prices and drilling budgets of oil and gas companies. Our day rates and utilization rates are also affected by the size, configuration, age and capabilities of our fleet. In the case of supply boats and PSVs, their deck space and liquid mud and dry bulk cement capacity are important attributes. In certain markets and for certain customers, horsepower and dynamic positioning systems are also important requirements. For crew boats, size and speed are important factors. Our day rates and utilization are also affected by the supply of other vessels available in a given market area with similar configurations and capabilities.

Our operating costs are primarily a function of fleet size and utilization levels. The most significant direct operating costs are wages paid to vessel crews, maintenance and repairs and marine insurance. Generally, increases or decreases in vessel utilization only affect that portion of our direct operating costs that is incurred when the vessels are active. As a result, direct operating costs as a percentage of revenues may vary substantially due to changes in day rates and utilization.

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In addition to these variable costs, we incur fixed charges related to the depreciation of our fleet and costs for the routine dry-dock inspection, maintenance and repair designed to ensure compliance with U.S. Coast Guard regulations and to maintain required certifications for our vessels. Maintenance and repair expense and marine inspection amortization charges are generally determined by the aggregate number of dry-dockings and other repairs undertaken in a given period. Costs incurred for dry-dock inspection and regulatory compliance are capitalized and amortized over the period between such dry-dockings, typically two to five years.

Overview

During 2003, the Company experienced disappointing results from operations primarily due to low levels of drilling activity in the key markets in which it operates. These low levels of drilling activity, combined with the increase of competition to our market areas, led to reductions in day rates and utilization of our fleet in most market areas. As a result of reduced revenues and disappointing operating results in 2003 and in the recent past, the Company completed steps to enhance liquidity. During 2003, the Company sold a large North Sea vessel and a Brazilian vessel under construction, which generated approximately $52.5 million of cash. Additionally, the Company entered into a new term loan in February 2004, which added flexibility and increased available liquidity.

The Company had goodwill related to the 1997 acquisition of its North Sea reporting segment. Statement of Financial Accounting Standards (“SFAS”) No. 142, “Goodwill and Other Intangible Assets,” requires an annual assessment of goodwill for impairment, which the Company elected to conduct during the second quarter of its fiscal year. During the second quarter ended June 30, 2002, the Company conducted its initial assessment for goodwill impairment as required under SFAS No. 142. That assessment used a projection of discounted cash flows, comparable industry financial ratios and other data. The Company determined at that time that there was no impairment of goodwill based on the operating results to date, and, as discussed in previous filings, management’s expectations that market conditions for the North Sea would remain stable through 2002, and then improve in 2003. However, operating results in the North Sea began to experience a decline during the early part of fiscal 2003. Upon the completion of the Company’s annual goodwill analysis in the second quarter ended June 30, 2003, the Company recorded a goodwill impairment charge of approximately $28.6 million. This charge reflected the devaluation in the North Sea reporting unit’s fair value compared to the book value, and was estimated based on the projected future discounted cash flows of the reporting unit, in light of current market conditions and our expectations at the time, which we believed would remain stable or improve in the latter half of 2003. After continued deterioration in market conditions in the North Sea during the third and fourth quarters of 2003, the Company determined that an additional interim test of impairment was necessary as of December 31, 2003. While annual average day rates and number of vessels in the North Sea had remained relatively steady for the past three years and the utilization had declined marginally, our expectation of the low level of activity in the North Sea is believed to continue rather than return to 2001 levels in the near term. As a result of performing this test, we recorded an additional charge of $84.4 million in the fourth quarter of 2003 which represents the remainder of the goodwill associated with the North Sea reporting unit.

Looking forward, we will continue to explore ways to enhance the Company’s liquidity and leverage structure. Although the overall U.S. economy is improving in general, we are very cautious about 2004 operating results, and believe the exploration and production activity in our market areas could remain somewhat depressed. If market conditions in any market in which the Company operates were to continue to deteriorate, it could require the Company to examine the recoverability of its long-lived assets in that market. See further discussion in “Impairment of long-lived assets other than goodwill” in Critical Accounting Policies included in Item 7.

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Results of Operations

The table below sets forth by vessel class, the average day rates and utilization for our vessels and the average number of vessels we operated during the periods indicated.

Set forth below is the internal allocation of our charter revenues and charter revenues less direct vessel operating expenses among vessel classes for each of the periods indicated (dollars in thousands).

Comparison of the Year Ended December 31, 2003 to the Year Ended December 31, 2002

Our revenues in 2003 were $123.5 million compared to $133.9 million in 2002. The 8% decrease in revenues during the year was a result of lower average vessel day rates and utilizations, specifically in the Gulf class supply boats and the North Sea AHTS vessels.

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For the Gulf class supply vessels, day rates decreased 11% from $5,575 in 2002 to $4,954 in 2003. Utilization also decreased for these vessels from 53% in 2002 to 51% in 2003. The decrease in both day rates and utilization is a direct result of the continued low level of Gulf of Mexico drilling activity.

For our North Sea PSVs and AHTSs, day rates decreased 3% from $11,641 in 2002 to $11,295 in 2003. Utilization also decreased from 89% in 2002 to 82% in 2003. The decrease in both day rates and utilization were results of continued market pressure from competition and low levels of drilling activity.

In contrast, the Company’s crew boats and line handlers experienced increased day rates and utilization in 2003 compared to 2002. Day rates increased 9% from $2,654 in 2002 to $2,897 in 2003, while utilization increased from 67% in 2002 to 74% in 2003. These increases were partly due to the full year effect of several two-year contracts for line handlers entered into during the third quarter of 2002 at increased day rates.

Direct vessel operating expenses decreased 3% from $84.1 million in 2002 to $81.2 million in 2003. The decrease is primarily due to reductions in vessel maintenance and repairs and labor costs during 2003, offset partially by an increase in supplies. The reduction in labor and maintenance costs is a result of an increase in the Norwegian government’s reimbursement of such costs, and the sale of the large North Sea AHTS in 2003.

General and administrative expenses increased 3% from $15.1 million to $15.5 million when comparing 2003 to 2002. The increase in general and administrative expenses are related to increased insurance and professional fees, as well as increased costs associated with the new sales and operations offices in Mexico and Nigeria.

The Company’s depreciation and amortization expense increased $1.5 million or 5% from $31.9 million in 2002 to $33.4 million in 2003. Depreciation and amortization increased when comparing 2003 to 2002 due to the Company recording the first full year of depreciation for two vessels entering the North Sea fleet in 2002.

During 2003, the Company recorded a charge of $6.2 million in association with the sale of one of its larger North Sea vessels, and the sale of its investment in a construction project in Brazil. The expense is classified as a “Loss on assets held for sale” since the Company recorded the charge when the formal plan to sell the assets was committed to.

Also in 2003, the Company recorded two impairment charges to goodwill of $28.6 and $84.4 million during the second and fourth quarters of 2003, respectively. When performing its annual impairment test during the second quarter ended June 2003, the Company determined that an impairment was necessary for its goodwill balance related to the North Sea reporting unit and, to a lesser extent, Brazil. The June 2003 impairment was a result of the continued slowness in the North Sea market, which in turn, devalued the reporting unit. As a result, the Company recorded a charge of $28.6 million in the second quarter of 2003. After continued deterioration in market conditions in the North Sea during the third and fourth quarters of 2003, the Company determined that an additional interim test of impairment was necessary as of December 31, 2003. As a result of the December 2003 analysis, the Company determined that an additional impairment was warranted, and recorded an impairment on the remaining goodwill balance of approximately $84.4 million.

During 2003, the Company sold two crew boats and one supply vessel, which resulted in gains of $1.0 million in the aggregate.

Interest expense increased $1.7 million or 6% as a result of a higher average debt balance, and the full year of expense for the 8.875% senior notes, which were issued in May 2002 to replace the 8.5% senior notes.

The Company recorded a consolidated income tax benefit in 2003 of $2.9 million, which is primarily related to the Company’s Norwegian operations. The Company’s $14.6 million tax expense in 2002 is a result of the deferred tax valuation allowance booked in 2002. The Company has continued to book a full valuation allowance against its U.S. deferred tax assets during 2003.

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Comparison of the Year Ended December 31, 2002 to the Year Ended December 31, 2001

Our revenues in 2002 were $133.9 million, a decrease of 27%, compared to $182.6 million in 2001. The decrease was due primarily to a decrease in day rates and utilization for our Gulf class supply boats and crew boats. The decrease in utilization and day rates of our Gulf class fleet is attributable to decreased Gulf drilling activity.

Our average Gulf class supply boat day rates decreased 21% to $5,575 for 2002, compared to $7,043 for 2001. The average day rates for our fleet of crew boats and line handling vessels decreased 2% to $2,654, compared to $2,714 for 2001.

Utilization for our Gulf class supply boat fleet decreased to 53% in 2002 from 69% in 2001 due to the decrease in offshore drilling activity in the Gulf. Utilization for our crew boats and line handling vessels decreased to 67% in 2002, compared to 78% in 2001, due to the decrease in activity in the Gulf.

Average day rates for our North Sea vessels in 2002 decreased 2% to $11,641 compared to $11,884 for 2001. Vessel utilization was 89% for 2002, compared to 93% for 2001. Two large PSVs were added to our North Sea fleet during 2002.

During 2002, direct vessel operating expenses increased to $84.1 million, compared to $82.1 million for 2001. The direct vessel operating expenses increased as a result of higher North Sea labor costs, higher insurance costs and the addition of two new PSVs during 2002. The higher North Sea labor costs were primarily attributable to the addition of two new PSVs during 2002, required union related pay increases and the strengthening of the Norwegian Kroner against the dollar. The above rate increases were offset in part by reduced U.S. vessel labor and U.S. maintenance costs.

During the fourth quarter of 2002, we recorded a non-cash vessel book value write-down in the amount of $5.2 million. The write-down was taken against the book value of two special purpose towing vessels that have limited capabilities as conventional supply vessels.

Depreciation and amortization expense was $31.9 million in 2002, down from $32.9 million in 2001. Depreciation and amortization in 2001 included $2.6 million of amortization expense associated with goodwill. Pursuant to the provisions of Statement of Financial Accounting Standards (“SFAS”) No. 142, “Goodwill and Other Intangible Assets”, no goodwill amortization expense was recorded in 2002. Amortization of marine inspection costs decreased to $10.2 million in 2002, from $13.4 million in 2001 due to a reduction in dry docking and marine inspection costs.

Our general and administrative expenses increased to $15.1 million in 2002, from $13.6 million for 2001, principally due to increases in insurance, professional fees and the strengthening of the Norwegian Kroner against the dollar. General and administrative expenses, as a percentage of revenues, increased in 2002 due primarily to the decrease in average day rates and utilization for our Gulf class supply boats and crew boats.

Interest expense increased to $28.4 million during 2002, compared to $26.2 million during 2001, due to additional borrowings associated with the construction of the two North Sea PSVs completed in 2002 and additional borrowings and interest costs associated with the refinancing of our senior notes.

We incurred an $11.0 million loss in 2002, which resulted from the early retirement of the Company’s previously issued 8 ¹/2% senior notes and the fourth quarter 2002 refinancing of our revolving credit facility.

Income tax expense in 2002 of $14.5 million is comprised of a $1.7 million income tax expense associated with our North Sea operations and a $12.8 million income tax expense associated with our third quarter of 2002 U.S. deferred tax valuation allowance made pursuant to the provisions under SFAS No. 109, “Accounting for Income Taxes.” In 2001, we had an income tax benefit of $3.3 million and an effective tax rate of 32%. The

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variance from our statutory rate is due to income that was contributed by our Norwegian operations for which taxes were provided at the Norwegian statutory rate of 28%.

Liquidity and Capital Resources

In accordance with U.S. GAAP, we have classified the NOK 800 million revolving credit facility (the “Trico Supply Bank Facility”) as a current liability in the consolidated balance sheets. Previously, the Company presented the outstanding balance as a long-term liability because the facility has a final maturity of September 2009 and the fact that the Company does not use cash to repay advances on a short-term basis, but instead rolls over an advance into a new advance period. For future cash flow purposes, we consider the Trico Supply Bank Facility to be a long-term source of funds since advances can be re-financed until the facility reduces over time, concluding in September 2009. As long as the Company is in compliance with the covenants of the Trico Supply Bank Facility, and the lender does not exercise the subjective acceleration clause, the Company is not obligated to repay and retire any amounts outstanding under the facility during the next 12 months. The Company had NOK 410 million outstanding under this facility as of December 31, 2003 ($61.5 million). The Company’s Norwegian operating subsidiary, Trico Shipping AS, is the borrower of this facility. This change in classification does not affect the Company’s compliance with this facility or other currently outstanding debt instruments, and does not affect the liquidity position of the Company for any period previously reported.

See Note 4 to the Financial Statements included in Item 8 for a discussion of subsequent events and liquidity.

Our on-going capital requirements arise primarily from our need to service debt, maintain or improve equipment and provide working capital to support our operating activities.

Continued low levels of Gulf of Mexico drilling activity have negatively impacted Gulf class vessel utilization and day rates in 2003. North Sea operating results for 2003 also lagged behind the comparable 2002 period. During the third quarter of 2003, the Company completed phase one of its liquidity enhancement plan that was designed to address its near-term financial and liquidity needs. Phase one of the liquidity enhancement plan resulted in the Company entering into a loan agreement providing for a NOK 150 million ($22.5 million) term loan, receiving a $4.5 million federal tax refund as a result of net operating loss carryback claims, and selling a North Sea class vessel and the Brazilian AHTS project for a total of approximately $52.5 million.

Phase two of the Company’s liquidity enhancement plan included amending the Company’s U.S. bank credit facility in an effort to comply with its restrictive covenants, or refinancing the facility. In February 2004, the Company entered into a new $55 million senior secured term loan (the “2004 Term Loan”) which retired and replaced the existing Bank Credit Facility (See Note 9 to the Consolidated Financial Statements, included in Item 8). The 2004 Term Loan eliminates the financial maintenance covenants of the Bank Credit Facility, and is collateralized by 43 Gulf Coast class supply vessels.

In the short-term, we expect a substantial portion of our liquidity to be provided by cash provided by operations, our unrestricted cash, and our NOK Credit Facility. As of February 27, 2004, we had unrestricted cash of $37.6 million and NOK 320 million of borrowing capacity under our NOK Credit Facility. However, we are restricted to NOK 202 million of availability as a result of financial covenants under such facility. With the completion of the 2004 Term Loan, the Company believes that cash provided by operations and current unrestricted cash and availability under its NOK credit facility will be sufficient to fund our debt service requirements, working capital and vessel maintenance expenditures until at least December 31, 2004, barring any unforeseen circumstances. If current activity levels continue in the Gulf of Mexico and the North Sea, it would require us to depend more heavily on our NOK Credit Facility.

In the longer term, our ability to pay debt service and other contractual obligations will depend on improving our future performance and cash flow generation, which in turn will be affected by prevailing economic and industry conditions and financial, business and other factors, many of which are beyond our control. If we have difficulty paying debt service or other contractual obligations in the future, we will be forced

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to take actions such as reducing or delaying capital expenditures, reducing costs, selling assets, refinancing or restructuring our debt or other obligations and seeking additional equity capital. We may not be able to take any of these actions on satisfactory terms or at all.

As a result of the Company’s operating losses and continued negative market conditions during 2003, on July 25, 2003, Moody’s Investors Service (“Moody’s”) downgraded our long-term senior implied rating to B3 from B1 and lowered our senior unsecured notes’ rating to Caa1 from C2. On January 27, 2004, Moody’s downgraded our long-term senior implied rating to Caa1 from B3 and lowered our senior unsecured notes’ rating to Caa2 from Caa1. On November 24, 2003, Standard & Poor’s Ratings Services (“S&P”), a division of The McGraw-Hill Companies, Inc., downgraded our senior unsecured notes to CCC from CCC+ and placed that credit rating on creditwatch with negative implications. In addition, S&P lowered our corporate rating to B- from B on the same date. On March 11, 2004, S&P downgraded the senior unsecured notes from CCC to CCC- and the corporate rating from B- to CCC+. This downgrade requires the Company to post an additional letter of credit of approximately $1.7 million under the Company’s master bareboat charter agreement. Because of these downgrades, and the potential of one or both rating agencies continuing to downgrade our debt, it is likely that we will have difficulty obtaining financing and our cost of obtaining additional financing or refinancing existing debt may be increased significantly.

During 2003, $9.6 million in funds were used in operating activities compared to $7.9 million used in operating activities during 2002. Operating cash flows have remained negative, due primarily to the continued slowness of drilling activity in our market areas. Operating cash flows decreased by $1.7 million primarily due to reduced revenues compared to 2002, offset by a recovery of cash from a reduction of the accounts receivable balance during the year. In 2003, $31.5 million was provided by investing activities, compared with $63.6 million used in investing activities in 2002. The increase of funds in 2003 was the result of the sales of the Brazilian AHTS and a large Norwegian vessel for $52.5 million, accompanied by a $43.4 million reduction of property and equipment purchases during 2003 due to fewer vessel constructions. The sale of vessels and the reduction of new property purchases are a direct result of the Company’s liquidity enhancement plan enacted during 2003. From financing activities, the Company used $6.3 million in 2003 compared to cash provided by financing activities of $47.5 million in 2002. In 2003, the Company repaid current debt maturities as well as retiring a portion of the existing debt with new debt issuances.

The following table summarizes our contractual commitments, as of December 31, 2003, related to the principal amount of our debt (adjusted to reflect subsequent transactions), leases and other arrangements for the periods indicated below (in thousands), restated.

The Company’s Trico Supply Bank Facility is classified as a current maturity in accordance with U.S. GAAP requirements.

As of December 31, 2003, the Company has approximately $380.2 million of debt outstanding with a weighted average interest rate of 7.2%. Of this amount, approximately $4.8 million is due in 2004. When adjusted to include the effects of the 2004 Term Loan entered into subsequent to December 31, 2003, the current maturities of long term debt increase to $5.2 million and the total debt balance increases to $406.0 million, as reflected in the table above.

The Company’s long term debt is comprised of a combination of senior unsecured notes, credit facilities, and senior secured notes, subject to restrictive covenants. The indenture governing the 8 ⁷/8% Senior Notes contains covenants that, among other things, prevent us from incurring additional debt, paying dividends or making other distributions, unless our ratio of cash flow to interest expense on a rolling twelve month basis is at

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least 2.0 to 1. Currently we do not meet this ratio and, therefore, are limited under the indenture to incurring at any one time and having outstanding, up to $150.0 million of secured debt after the date of issuance of the notes. In addition, our NOK credit facility contains covenants that require our North Sea reporting unit to maintain certain financial ratios and limit its ability to create liens, or merge or consolidate with other entities.

Approximately 22% of the Company’s total debt is payable in NOK, while 78% is payable in U.S. Dollars (USD). At December 31, 2003, the Company had approximately $265.2 million (or 70%) of fixed rate debt and approximately $115.0 million (or 30%) of variable rate debt. The Company’s fixed interest rates range from 6.08% to 8.875%. The Company’s variable rate debts are indexed based on LIBOR (London Interbank Offered Rate) and NIBOR (Norwegian Interbank Offered Rate), some of which are subject to floors.

The Company has entered into operating leases, primarily as a result of sale-leaseback type transactions. The leases are classified as operating leases due to their relative short duration (10 years) as compared to the expected life of the vessel.

The Company has issued stand-by letters of credit totaling $6.3 million as of December 31, 2003.

At December 31, 2003, the Company does not have any planned capital expenditures other than approximately $10.5 million to fund the dry docking of vessels and related repairs to be incurred during 2004.

Subsequent to December 31, 2003, the Company entered into a $55 million term loan, the proceeds of which were used primarily to retire its U.S. Credit Facility. As a result of the refinancing, at February 27, 2003, we had approximately $45.7 million in cash, of which $37.6 million was unrestricted. In addition to cash on hand, the Company has NOK 320 million ($45.4 million) of available borrowing capacity under our NOK Credit Facility. The NOK credit facility availability reduces by NOK 40 million every March and September. However, we are restricted to NOK 202 million ($28.7 million) of availability as a result of financial covenants under such facility. In an effort to repatriate funds from Norway to the U.S. in a tax-efficient manner, the Company is undertaking a reduction of its paid-in capital in Trico Supply AS. Upon completion of this reduction, the Company will be able to repatriate NOK 200 million ($28.4 million) for working capital and other corporate purposes. The Company believes that the reduction of its paid-in capital process will be completed by June 30, 2004.

We cannot make any assurances, however, that the factors beyond our control affecting demand for our vessels will not impact our ability to generate sufficient cash flow from operations, or obtain borrowings under our credit facilities, in an amount sufficient to enable us to pay our indebtedness and fund our other liquidity needs. We may need to refinance all or a portion of our indebtedness on or before maturity. We cannot assure you that we will be able to refinance any of our indebtedness, including existing and subsequent facilities, on commercially reasonable terms or at all.

Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to bad debts, fixed assets, deferred expenses, inventories, goodwill, income taxes, pension liabilities, contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

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We consider certain accounting policies to be critical policies due to the significant judgement, estimation processes and uncertainty involved for each in the preparation of our consolidated financial statements. We believe the following represent our critical accounting policies.

Impairment of long-lived assets other than goodwill.    In accordance with the provisions of SFAS No. 144, “Accounting for the Impairment or Disposal of Long Lived Assets,” we review long-lived assets for impairment when events or changes in circumstances indicate that the carrying amount of any such asset may not be recoverable. We record impairment losses on long-lived assets used in operations when the net discounted cash flows estimated to be generated by those assets are less than the carrying amount of those items. Our cash flow estimates are based upon historical results adjusted to reflect our best estimate of future market rates, utilization, operating performance and other factors. Our estimates of cash flows may differ from actual cash flows due to changes in economic conditions or changes in an asset’s operating performance, among other things. If the undiscounted value of the cash flows is less than the carrying value, we recognize an impairment loss, measured as the amount by which the carrying value exceeds the net discounted cash flow. No impairments were determined as a result of the 2003 FAS No. 144 analysis. During the year ended December 31, 2002, we recognized $5.2 million of fixed asset impairments. While we believe that our estimates of future cash flows are reasonable, different assumptions regarding future market rates, utilization and operating performance could materially affect our evaluations. If market conditions were to decline in any markets in which the Company operates, it could require the Company to evaluate the recoverability of its long-lived assets in that market.

Impairment of goodwill.    At the beginning of 2003, the Company’s goodwill balance of $110.6 million related primarily to the 1997 acquisition of our North Sea operations, which is considered a reporting unit pursuant to the provisions of SFAS No. 142, “Goodwill and Other Intangible Assets.” The Company tests for the possible impairment of goodwill at the reporting unit level in accordance with the requirements of SFAS No. 142. In assessing reporting unit fair value, we must make assumptions regarding estimated future cash flows and other factors used to determine fair value. If these estimates or their related assumptions adversely change in the future, we may be required to record material impairment charges for these assets. Annually or when market conditions necessitate interim analysis, the Company calculates reporting unit fair value based on estimated cash flows, comparable industry financial ratios and other analysis. The reporting unit fair value is compared to carrying value to determine whether the goodwill is impaired. The Company performed its annual impairment analysis as of June 30, 2003 and determined that a goodwill impairment did exist. Therefore, the Company recorded a charge of approximately $28.6 million during the second quarter of 2003. After continued deterioration in market conditions in the North Sea during the third and fourth quarters of 2003, the Company determined that an additional interim test of impairment was necessary as of December 31, 2003. As a result of the December 2003 analysis, the Company determined that an additional impairment was warranted, and recorded an impairment on the remaining goodwill balance of approximately $84.4 million.

Deferred Tax Valuation Allowance.    Income taxes are determined in accordance with SFAS No. 109, “Accounting for Income Taxes,” which requires recognition of deferred income tax liabilities and assets for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Under this method, deferred income tax liabilities and assets are determined based on the difference between the financial statement and tax bases of liabilities and assets using enacted tax rates in effect for the year in which the differences are expected to reverse. SFAS 109 also provides for the recognition of deferred tax assets if it is more likely than not that the assets will be realized in future years. A valuation allowance of $22.7 million was established in the third quarter of 2002 associated with the U.S. deferred tax asset. The Company has continued to book a full valuation allowance against all U.S. net operating losses since the establishment of the allowance in 2002.

Deferred marine inspection costs.    We record the cost of major scheduled drydocking inspection costs for our vessels as deferred charges. We amortize these deferred charges over the expected periods of benefit, typically ranging from two to five years. See “New Accounting Standards” below for more discussion on proposed accounting changes for deferred marine inspection costs.

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New Accounting Standards

In January 2003, the Financial Accounting Standards Board (“FASB”) issued FASB Interpretation No. 46 (“FIN 46”), “Consolidation of Variable Interest Entities.” FIN 46 clarifies the application of Accounting Research Bulletin No. 51, “Consolidated Financial Statements,” to certain entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The FASB subsequently revised FIN 46 with FIN 46R. FIN 46 and FIN 46R apply immediately to variable interest entities created after January 31, 2003, and to variable interest entities in which an enterprise obtains an interest after that date. The statements apply in the first fiscal year or interim period ending after March 15, 2004, to variable interest entities in which an enterprise holds a variable interest that it acquired before February 1, 2003. The Company believes that the adoption of the provisions of FIN 46 will have no impact upon its financial position or results of operations.

In June 2001, the Accounting Standards Executive Committee of the AICPA, (“AcSEC”), issued an exposure draft of a proposed Statement of Position (“SOP”), “Accounting for Certain Costs and Activities Related to Property, Plant, and Equipment.” This SOP provides guidance on accounting for certain costs and activities relating to property, plant, and equipment (“PP&E”). For purposes of this SOP, a project stage or timeline framework is used and PP&E assets are accounted for at a component level. Costs incurred for PP&E are classified into four stages: preliminary, preacquisition, acquisition-or-construction and in-service. The SOP requires, among other things, that preliminary, preacquisition and acquisition-or-construction stage costs, except for payments to obtain an option to acquire PP&E, should be charged to expense as incurred. Costs related to PP&E that are incurred during the in-service stage, including costs of normal, recurring, or periodic repairs and maintenance activities, should be charged to expense as incurred unless the costs are incurred for acquisition of additional PP&E or components of PP&E or the replacement of existing PP&E or components of PP&E. Costs of planned major maintenance activities would be charged to expense, except for acquisitions or replacements of components that are capitalizable under the in-service stage guidance of this SOP. In September 2003, the AcSEC approved the SOP for issuance to the FASB for final clearance, which is expected in the second quarter of 2004. If the proposed SOP is adopted in its current form, the Company will have to expense its currently capitalized deferred marine inspection costs, which totaled approximately $20.8 million at December 31, 2003. This write-off would be accounted for as a cumulative effect of a change in accounting principle as of the beginning of the year of adoption. This SOP, if approved, is scheduled to become effective for fiscal periods beginning after December 15, 2004. Further evaluation is required by the Company to fully quantify the impact of this proposed pronouncement, if adopted.

In December 2003, the FASB issued a revised version of SFAS No. 132. This revised statement adds to the annual disclosures about pensions and other postretirement benefits that were required by the original statement issued in 1997. The revised statement also requires certain interim disclosures. Both the original and the revised statements address disclosure only and do not address accounting, measurement or recognition for benefit obligations. With certain limited exceptions, the added annual disclosures were effective as of December 31, 2003 for the Company and are included in Note 15 of the Consolidated Financial Statements in Item 8. The Company is required to present the interim disclosures beginning with its quarter ending March 31, 2004.

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Item 8.    Financial Statements and Supplementary Data

Index to Consolidated Financial Statements

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of Trico Marine Services, Inc.:

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations, stockholders’ equity and cash flows present fairly, in all material respects, the financial position of Trico Marine Services, Inc. and Subsidiaries (the “Company”) as of December 31, 2003 and 2002, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2003, in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company‘s management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 7 to the consolidated financial statements, the Company changed the manner in which it accounts for goodwill and other intangible assets as of January 1, 2002.

As discussed in Note 3 to the consolidated financial statements, the Company has restated its consolidated financial statements as of December 31, 2003 and 2002.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Notes 1 and 4 to the consolidated financial statements, the Company elected not to make its cash interest payment due May 15, 2004 and is currently in default under the terms of its Senior Notes Indenture. This also resulted in cross-defaults under the terms of other obligations described in Note 4. These events raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regards to these matters are also described in Note 4. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ PricewaterhouseCoopers LLP

New Orleans, Louisiana

March 11, 2004 except for Note 1, paragraph 4, and Notes 3, 4, 9 and 20

which are as of August 6, 2004.

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TRICO MARINE SERVICES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

as of December 31, 2003 and 2002

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

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TRICO MARINE SERVICES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

for the years ended December 31, 2003, 2002 and 2001

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

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TRICO MARINE SERVICES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

for the years ended December 31, 2003, 2002 and 2001