
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    Form 10-Q

           |X| Quarterly Report Pursuant to Section 13 or 15(d) of
                     the Securities Exchange Act of 1934
                   For the quarterly period ended June 30, 2001

            |_| Transition Report Pursuant to Section 13 or 15(d)
                    of the Securities Exchange Act of 1934
                   For the transition period _____ to _____

                          Commission File Number 0-5232

                           OFFSHORE LOGISTICS, INC.
            (Exact name of registrant as specified in its charter)

                Delaware                               72-0679819
     (State or other jurisdiction of                  (IRS Employer
     incorporation or organization)              Identification Number)

             224 Rue de Jean
   P. O. Box 5C, Lafayette, Louisiana                     70505
 (Address of principal executive offices)              (Zip Code)

      Registrant's telephone number, including area code: (337) 233-1221

   ---------------------------------------------------------------------------
          (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 of 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 the number shares  outstanding of each of the issuer's  classes of
Common Stock, as of August 1, 2001.

                21,892,421 shares of Common Stock, $.01 par value



<PAGE>
                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements



                  OFFSHORE LOGISTICS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF INCOME
               (THOUSANDS OF DOLLARS, EXCEPT PER SHARE AMOUNTS)


                                                         THREE MONTHS ENDED
                                                              JUNE 30,
                                                         ------------------
                                                          2001       2000
                                                         ------     ------
GROSS REVENUE
Operating revenue...................................... $123,284   $110,579
Gain on disposal of assets.............................      425        670
                                                        --------   --------
                                                         123,709    111,249
OPERATING EXPENSES
Direct cost............................................   88,413     86,708
Depreciation and amortization..........................    8,378      8,829
General and administrative.............................    7,666      6,839
                                                        --------   --------
                                                         104,457    102,376

OPERATING INCOME.......................................   19,252      8,873

Equity in earnings from unconsolidated entities........      962      1,019
Interest income........................................    1,148        739
Interest expense.......................................    4,359      4,334
                                                        --------   --------

INCOME BEFORE PROVISION FOR INCOME TAXES
AND MINORITY INTEREST..................................   17,003      6,297

Provision for income taxes.............................    5,270      1,953
Minority interest......................................     (362)      (347)
                                                        --------   --------

NET INCOME............................................. $ 11,371   $  3,997
                                                        ========   ========

Net income per common share:
Basic.................................................. $    0.52  $    0.19
                                                        =========  =========
Diluted................................................ $    0.47  $    0.19
                                                        =========  =========



<PAGE>
                  OFFSHORE LOGISTICS, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                            (THOUSANDS OF DOLLARS)


                                                        JUNE 30,   MARCH 31,
                                                           2001       2001
                                                        --------   ---------
ASSETS
------
Current Assets:
   Cash and cash equivalents............................$  34,517  $ 54,794
   Accounts receivable..................................  138,508   114,763
   Inventories..........................................   86,401    81,578
   Prepaid expenses.....................................    9,511     6,900
                                                        ---------  --------
     Total current assets...............................  268,937   258,035

Investments in unconsolidated entities..................   18,118    17,868
Property and equipment - at cost:
   Land and buildings...................................   13,251    10,990
   Aircraft and equipment...............................  620,570   603,021
                                                        ---------  --------
                                                          633,821   614,011
Less:  accumulated depreciation and amortization........ (174,114) (167,321)
                                                        ---------  --------
                                                          459,707   446,690
Other assets............................................   31,564    32,227
                                                        ---------  --------

                                                        $ 778,326  $754,820
                                                        =========  ========

LIABILITIES AND STOCKHOLDERS' INVESTMENT
----------------------------------------
Current Liabilities:
   Accounts payable.....................................$  35,893  $ 32,401
   Accrued liabilities..................................   68,735    63,796
   Deferred taxes.......................................   17,391    15,265
   Current maturities of long-term debt.................   18,660    13,122
                                                        ---------  --------
     Total current liabilities..........................  140,679   124,584

Long-term debt, less current maturities.................  202,305   209,190
Other liabilities and deferred credits..................   16,628    15,071
Deferred taxes..........................................   97,033    95,469
Minority interest.......................................   12,231    11,959

Stockholders' Investment:
   Common Stock, $.01 par value, authorized 35,000,000
   shares; outstanding 21,892,421 and 21,815,421 at June
   30 and March 31, respectively (exclusive of 1,281,050
   treasury shares).....................................      219       218
   Additional paid-in capital...........................  128,883   127,554
   Retained earnings....................................  223,289   211,918
   Accumulated other comprehensive income (loss)........  (42,941)  (41,143)
                                                        ---------  --------
                                                          309,450   298,547
                                                        ---------  --------
                                                        $ 778,326  $754,820
                                                        =========  ========

<PAGE>
                  OFFSHORE LOGISTICS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (THOUSANDS OF DOLLARS)


                                                         THREE MONTHS ENDED
                                                              JUNE 30,
                                                         ------------------
                                                           2001       2000
                                                         -------     ------
Cash flows from operating activities:
   Net income...........................................$  11,371  $  3,997
Adjustments to reconcile net income to cash
provided by operating activities:
   Depreciation and amortization........................    8,378     8,829
   Increase (decrease) in deferred taxes................    4,423       592
   (Gain) loss on asset dispositions....................     (425)     (670)
   Equity in earnings from unconsolidated entities
     (over) under dividends received....................     (308)     (833)
   Minority interest in earnings........................      362       347
   (Increase) decrease in accounts receivable...........  (24,380)  (16,653)
   (Increase) decrease in inventories...................   (5,125)     (265)
   (Increase) decrease in prepaid expenses and other....   (2,658)    3,712
   Increase (decrease) in accounts payable..............    3,706    (2,575)
   Increase (decrease) in accrued liabilities...........    5,199     4,393
   Increase (decrease) in other liabilities
      and deferred credits..............................    1,641     1,140
                                                         --------    ------
Net cash provided by (used in) operating activities.....    2,184     2,014
                                                        ---------  --------

Cash flows from investing activities:
   Capital expenditures.................................  (24,313)  (12,204)
   Proceeds from asset dispositions.....................    1,847     2,024
   Investments in unconsolidated subsidiaries...........       --    (1,200)
                                                        ---------  --------
Net cash provided by (used in) investing activities.....  (22,466)  (11,380)
                                                        ---------  --------

Cash flows from financing activities:
   Repayment of debt....................................     (955)   (6,937)
   Issuance of common stock.............................    1,005        --
                                                        ---------  --------
Net cash provided by (used in) financing activities.....       50    (6,937)
                                                        ---------  --------

Effect of exchange rate changes in cash.................      (45)     (799)
                                                        ---------  --------

Net increase (decrease) in cash and cash equivalents....  (20,277)  (17,102)
Cash and cash equivalents at beginning of period........   54,794    37,935
                                                        ---------  --------

Cash and cash equivalents at end of period..............$  34,517  $ 20,833
                                                        =========  ========

Supplemental disclosure of cash flow information
Cash paid during the period for:
   Interest.............................................$   3,099  $  3,651
   Income taxes.........................................$     932  $    340


<PAGE>
                  OFFSHORE LOGISTICS, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  JUNE 30, 2001

NOTE A - BASIS OF PRESENTATION AND CONSOLIDATION

     The  accompanying  unaudited  consolidated  financial  statements have been
prepared in accordance with the instructions to Form 10-Q and do not include all
information  and  footnotes  necessary  for a  fair  presentation  of  financial
position,  results of  operations  and cash flows in conformity  with  generally
accepted accounting  principles.  In the opinion of management,  any adjustments
considered  necessary  for a fair  presentation  have been  included.  Operating
results for the three months ended June 30, 2001, are not necessarily indicative
of the results  that may be expected  for the year ending  March 31,  2002.  For
further  information,   refer  to  the  consolidated  financial  statements  and
footnotes  included in the  Company's  Annual Report on Form 10-K for the fiscal
year ended March 31, 2001.

     During April 2001, the Company  completed  operating and control  revisions
with its partners in a Norwegian joint venture. As a result,  effective April 1,
2001, the Company will no longer  consolidate the results of the Norwegian joint
venture in its financial statements, and instead will treat the investment as an
unconsolidated  entity accounted for on the cost method of accounting.  The cost
method  of  accounting  will be  used,  as the  Company's  ability  to  exercise
significant  influence  over  the  operation  of  the  joint  venture  has  been
diminished.  The  Company  is not  obligated  under  any  agreement  to  provide
continuing  financial  support.  Had the Company  continued to  consolidate  the
financial  position  and net results of  operations  of the joint  venture,  the
impact on working capital and long-term  assets and liabilities at June 30, 2001
would not have been  material;  revenue would have increased by $5.7 million and
net income would have decreased by $0.4 million, or $0.01 per diluted share, for
the three months ended June 30, 2001.

NOTE B - EARNINGS PER SHARE

     Basic earnings per common share were computed by dividing net income by the
weighted average number of shares of common stock  outstanding  during the year.
Diluted  earnings per share for the three  months  ended June 30, 2000  excluded
3,976,928 shares related to the convertible debt and 319,500 stock options, at a
weighted  average exercise price of $19.06,  which were  outstanding  during the
period but were anti-dilutive. The following table sets forth the computation of
basic and diluted net income per share:
                                                        THREE MONTHS ENDED
                                                             JUNE 30,
                                                      -----------------------
                                                        2001          2000
                                                      ---------     ---------
Net income (thousands of dollars):
   Income available to common stockholders.........   $   11,371    $   3,997
   Interest on convertible debt, net of taxes......          941           --
                                                      ----------    ---------
   Income available to common stockholders,
      plus assumed conversions.....................   $   12,312    $   3,997
                                                      ==========    =========
Shares:
   Weighted average number of common shares
      outstanding..................................   21,863,674   21,105,921
   Options.........................................      282,831      211,894
   Convertible debt................................    3,976,928           --
                                                      ----------    ---------
   Weighted average number of common shares outstanding,
      plus assumed conversions.....................   26,123,433    21,317,815
                                                      ==========    ==========

Net income per share:
   Basic...........................................   $      0.52   $     0.19
                                                      ===========   ==========
   Diluted.........................................   $      0.47   $     0.19
                                                      ===========   ==========


<PAGE>
NOTE C - COMMITMENTS AND CONTINGENCIES

     On November 16, 1999, the Office and Professional  Employees  International
Union  ("OPEIU")  petitioned the National  Mediation Board ("NMB") to conduct an
election  among the mechanics and related  personnel  employed by Air Logistics,
LLC and Air Logistics of Alaska, Inc. The election for Air Logistics, L.L.C. was
held on March 13, 2000 with the  mechanics  voting in favor of the  Company.  On
January 17, 2001,  the OPEIU  notified the Company that it had begun  organizing
efforts with respect to the mechanics for a second time at Air Logistics, L.L.C.
No election was called and there are no continuing activities to the best of the
Company's  knowledge.  With respect to the Alaska-based group, the NMB dismissed
the matter on January 24, 2000, but due to extraordinary circumstances,  the NMB
did accept  another  representation  application  covering the Air  Logistics of
Alaska,  Inc. mechanics and related  employees.  The Alaska election was held on
July 21, 2000 with the mechanics voting in favor of the  International  Union of
Operating  Engineers ("IUOE").  Negotiations with the IUOE are in progress.  The
Company  does not believe  that  current  organizing  efforts will place it at a
disadvantage  with its  competitors  and  management  believes  that pay scales,
benefits, and work rules will continue to be similar throughout the industry.

NOTE D - COMPREHENSIVE INCOME

     In 1998,  the  Financial  Accounting  Standards  Board issued SFAS No. 130,
"Reporting  Comprehensive Income". SFAS No. 130 requires an entity to report and
display  comprehensive  income and its  components.  Comprehensive  income is as
follows (thousands of dollars):

                                                         THREE MONTHS ENDED
                                                               JUNE 30,
                                                         -------------------
                                                             2001     2000
                                                         ---------   -------
Net Income...............................................$  11,371  $  3,997
Other Comprehensive Income:
   Currency translation adjustments......................   (1,798)  (13,170)
                                                           -------   -------
Comprehensive Income (Loss)..............................$   9,573  $ (9,173)
                                                           =======   =======


NOTE E - RECENT ACCOUNTING PRONOUNCEMENTS

     Effective  April 1,  2001,  the  Company  adopted  Statement  of  Financial
Accounting  Standards  ("SFAS")  No. 138,  "Accounting  for  Certain  Derivative
Instruments and Hedging Activities",  that amends certain provisions of SFAS No.
133,  "Accounting  for  Derivative  Instruments  and  Hedging  Activities".  The
pronouncements  require that all  derivatives  be recognized as either assets or
liabilities  and  measured  at fair  value.  The  adoption  of SFAS No.  133, as
amended, did not have a material impact on the Company's financial statements.

     The Company  periodically  enters into spot and forward currency derivative
financial instruments to reduce its exposure to fluctuations in foreign currency
denominated assets and liabilities and contractual commitments. Forward currency
contracts  generally  do not  exceed  one year.  Any gains or losses on  forward
contracts  are deferred if the  transaction  qualifies  as a hedge.  At June 30,
2001,  the Company had nine  nominal  forward  contracts  for Euros  outstanding
totaling $20 million that qualified as a hedge instrument. The forward contracts
were purchased to hedge against any possible foreign  exchange  exposure related
to its commitment under a scheduled  maintenance  program. The fair market value
of these contracts at June 30, 2001 is not material.

<PAGE>
     On July 20, 2001, the Financial  Accounting Standards Board issued SFAS No.
142, "Goodwill and Other Intangible  Assets",  which establishes a new method of
testing goodwill for impairment using a  fair-value-based  approach and does not
permit amortization of goodwill as previously required by Accounting  Principles
Board Opinion No. 17, "Intangible  Assets". An impairment loss would be recorded
if the  recorded  goodwill  exceeds  its  implied  fair  value.  SFAS No. 142 is
effective for fiscal years  beginning  after December 15, 2001;  however,  early
adoption is allowed for companies  with fiscal years  beginning  after March 15,
2001 provided that first quarter  financial  statements have not been previously
issued.  The Company  did not elect to early  adopt SFAS No.  142.  Accordingly,
goodwill  amortization  expense of $0.3 million was recorded  during the quarter
ended June 30, 2001.

     The  FASB  also  recently  issued  SFAS  No.  143,  "Accounting  for  Asset
Retirement  Obligations".  This  statement,  which is first  effective  in 2003,
covers the accounting for closure or  removal-type  costs that are incurred with
respect  to  long-lived  assets.  The  nature  of  the  Company's  business  and
long-lived  assets is such that  adoption  of this new  standard  should have no
significant impact on the Company's financial position or results of operations.

NOTE F - SEGMENT INFORMATION

     SFAS No. 131,  "Disclosures  about  Segments of An  Enterprise  and Related
Information",  requires  that  companies  disclose  segment  data  based  on how
management makes decisions about allocating  resources to segments and measuring
their  performance.  The Company operates  principally in two business segments:
helicopter  activities  and  production  management  and related  services.  The
following shows reportable  segment  information for the three months ended June
30, 2001 and 2000,  reconciled to consolidated  totals, and prepared on the same
basis as the Company's consolidated financial statements (in thousands):

                                                     THREE MONTHS ENDED
                                                          JUNE 30,
                                                   --------------------
                                                      2001        2000
                                                   --------      ------

Segment operating revenue from external customers:
   Helicopter activities.......................... $111,127    $ 99,456
   Production management and related services.....   12,044      11,022
                                                   --------    --------
      Total segment operating revenue............. $123,171    $110,478
                                                   ========    ========

Intersegment operating revenue:
   Helicopter activities.......................... $  1,080    $  1,072
   Production management and related services.....       --          --
                                                   --------    --------
      Total intersegment operating revenue........ $  1,080    $  1,072
                                                   ========    ========

Consolidated operating revenue reconciliation:
   Helicopter activities.......................... $112,207    $100,528
   Production management and related services.....   12,044      11,022
   Corporate......................................    2,680       2,463
   Intersegment eliminations......................   (3,647)     (3,434)
                                                   --------    --------
      Total consolidated operating revenue........ $123,284    $110,579
                                                   ========    ========

Consolidated operating income reconciliation:
   Helicopter activities.......................... $ 18,342    $  7,819
   Production management and related services.....      813         666
                                                   --------    --------
      Total segment operating income..............   19,155       8,485
   Gain on disposal of assets.....................      425         670
   Corporate......................................     (328)       (282)
                                                   --------    --------
      Total consolidated operating income......... $ 19,252    $  8,873
                                                   ========    ========
<PAGE>
NOTE G - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION

     In  connection  with the sale of the  Company's  $100 million 7 7/8% Senior
Notes  due  2008,   certain  of  the  Company's   subsidiaries  (the  "Guarantor
Subsidiaries")  jointly,  severally and  unconditionally  guaranteed the payment
obligations  under  the  Senior  Notes.  The  following  supplemental  financial
information sets forth, on a consolidating  basis, the balance sheet,  statement
of income  and cash flow  information  for  Offshore  Logistics,  Inc.  ("Parent
Company  Only"),  for the  Guarantor  Subsidiaries  and for Offshore  Logistics,
Inc.'s other subsidiaries (the  "Non-Guarantor  Subsidiaries").  The Company has
not presented separate financial statements and other disclosures concerning the
Guarantor  Subsidiaries  because management has determined that such information
is not material to investors.

     The supplemental  condensed  consolidating  financial  information has been
prepared  pursuant  to  the  rules  and  regulations  for  condensed   financial
information  and does not include all disclosures  included in annual  financial
statements, although the Company believes that the disclosures made are adequate
to make the information presented not misleading. Certain reclassifications were
made to conform all of the financial  information to the financial  presentation
on a consolidated basis. The principal eliminating entries eliminate investments
in subsidiaries, intercompany balances and intercompany revenues and expenses.

     The allocation of the consolidated  income tax provision was made using the
with and without allocation method.

<PAGE>
NOTE G - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS - CONTINUED

<TABLE>
<CAPTION>

                                          SUPPLEMENTAL CONDENSED CONSOLIDATING BALANCE SHEET
                                                             JUNE 30, 2001
                                                        (THOUSANDS OF DOLLARS)

                                        Parent                          Non-
                                        Company        Guarantor     Guarantor
                                         Only        Subsidiaries    Subsidiaries  Eliminations    Consolidated
                                       ----------    ------------    ------------  ------------    ------------
<S>                                    <C>            <C>             <C>           <C>             <C>

ASSETS
  Current assets:
    Cash and cash equivalents..........$    7,085     $    4,072      $   23,360    $       --      $   34,517
    Accounts receivable................     2,385         40,171         101,012        (5,060)        138,508
    Inventories........................        --         48,686          37,715            --          86,401
    Prepaid expenses...................        85          1,588           7,838            --           9,511
                                       ----------     ----------      ----------    ----------      ----------
      Total current assets.............     9,555         94,517         169,925        (5,060)        268,937

  Intercompany investment..............   268,004             --              --      (268,004)             --
  Investments in unconsolidated entities       --             --          18,118            --          18,118
  Intercompany note receivables........   274,341          1,685              --      (276,026)             --

  Property and equipment--at cost:
    Land and buildings.................       135          5,805           7,311            --          13,251
    Aircraft and equipment.............     5,217        194,348         421,115          (110)        620,570
                                       ----------     ----------      ----------    ----------      ----------
                                            5,352        200,153         428,426          (110)        633,821
  Less:  accumulated depreciation
      and amortization.................    (2,818)       (83,723)        (87,573)           --        (174,114)
                                       ----------     ----------      ----------    ----------      ----------
                                            2,534        116,430         340,853          (110)        459,707
  Other assets.........................     9,847         15,016           6,591           110          31,564
                                       ----------     ----------      ----------    ----------      ----------

                                       $  564,281     $  227,648      $  535,487    $ (549,090)     $  778,326
                                       ==========     ==========      ==========    ==========      ==========

LIABILITIES AND STOCKHOLDERS' INVESTMENT
  Current liabilities:
    Accounts payable...................$      126     $    8,489      $   32,338    $   (5,060)     $   35,893
    Accrued liabilities................     7,256         16,795          44,684            --          68,735
    Deferred taxes.....................     1,004            316          16,071            --          17,391
    Current maturities of long-term debt       --             --          18,660            --          18,660
                                       ----------     ----------      ----------    ----------      ----------
     Total current liabilities.........     8,386         25,600         111,753        (5,060)        140,679

  Long-term debt, less current maturities 190,922             --          11,383            --         202,305
  Intercompany notes payable...........     5,012             --         271,014      (276,026)             --
  Other liabilities and deferred credits      262          2,840          13,526            --          16,628
  Deferred taxes.......................    16,423         39,723          40,887            --          97,033
  Minority interest....................    12,231             --              --            --          12,231

  Stockholders' investment:
    Common stock.......................       219          4,062           8,726       (12,788)            219
    Additional paid in capital.........   128,883         51,168           1,522       (52,690)        128,883
    Retained earnings..................   223,400        104,255          73,008      (177,374)        223,289
    Accumulated other comprehensive
      income (loss)....................   (21,457)            --           3,668       (25,152)        (42,941)
                                       ----------     ----------      ----------    ----------      ----------
                                          331,045        159,485          86,924      (268,004)        309,450
                                       ----------     ----------      ----------    ----------      ----------
                                       $  564,281     $  227,648      $  535,487    $ (549,090)     $  778,326
                                       ==========     ==========      ==========    ==========      ==========
</TABLE>


<PAGE>
NOTE G - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS - CONTINUED

<TABLE>
<CAPTION>

                                       SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF INCOME
                                                   THREE MONTHS ENDED JUNE 30, 2001
                                                        (THOUSANDS OF DOLLARS)

                                        Parent                          Non-
                                        Company        Guarantor     Guarantor
                                         Only        Subsidiaries    Subsidiaries  Eliminations    Consolidated
                                       ----------    ------------    ------------  ------------    ------------
<S>                                    <C>           <C>              <C>           <C>             <C>

GROSS REVENUE
Operating revenue......................$      112    $    47,870      $ 75,302      $       --      $  123,284
Intercompany revenue...................         2          1,860           321          (2,183)             --
Gain (loss) on disposal of assets......        (5)           427             3              --             425
                                       ----------    -----------      --------      ----------      ----------
                                              109         50,157        75,626          (2,183)        123,709
OPERATING EXPENSES
Direct cost............................         1         36,372        52,040              --          88,413
Intercompany expense...................        --            321         1,862          (2,183)             --
Depreciation and amortization..........       138          2,302         5,938              --           8,378
General and administrative.............     1,755          2,238         3,673              --           7,666
                                       ----------    -----------      --------      ----------      ----------
                                            1,894         41,233        63,513          (2,183)        104,457
                                       ----------    -----------      --------      ----------      ----------

OPERATING INCOME (LOSS)................    (1,785)         8,924        12,113              --          19,252

Equity in earnings from unconsolidated
     entities..........................     9,555             --           961          (9,554)            962
Interest income........................     8,376             82           348          (7,658)          1,148
Interest expense.......................     3,549             (2)        8,470          (7,658)          4,359
                                       ----------    -----------      --------      ----------      ----------

INCOME BEFORE PROVISION
     FOR INCOME TAXES AND
     MINORITY INTEREST.................    12,597          9,008         4,952          (9,554)         17,003
Allocation of consolidated income taxes       864          2,868         1,538              --           5,270
Minority interest......................      (362)            --            --              --            (362)
                                       ----------    -----------      --------      ----------      ----------

NET INCOME.........................    $   11,371    $     6,140      $  3,414      $   (9,554)     $   11,371
                                       ==========    ===========      ========      ==========      ==========
</TABLE>

<PAGE>
NOTE G - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS - CONTINUED
<TABLE>
<CAPTION>


                                     SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
                                                   THREE MONTHS ENDED JUNE 30, 2001
                                                        (THOUSANDS OF DOLLARS)

                                          Parent                        Non-
                                          Company    Guarantor       Guarantor
                                           Only      Subsidiaries    Subsidiaries  Eliminations    Consolidated
                                         ---------   ------------    ------------  ------------    ------------
<S>                                     <C>           <C>             <C>            <C>             <C>

Net cash provided by (used in)
     operating activities...............$  (15,543)   $  24,948       $ (1,090)      $  (6,131)      $   2,184
                                        ----------    ---------       --------       ---------       ---------

Cash flows from investing activities:
     Capital expenditures...............       (10)     (23,849)          (454)             --         (24,313)
     Proceeds from asset dispositions...        --        1,843              4              --           1,847
     Investments in subsidiaries........     2,000       (2,000)            --              --              --
                                        ----------    ---------       --------       ---------       ---------
Net cash provided by (used in)
     investing activities...............     1,990      (24,006)          (450)             --         (22,466)
                                        ----------    ---------       --------       ---------       ---------

Cash flows from financing activities:
     Repayment of debt..................        --           --         (7,086)          6,131            (955)
     Issuance of common stock...........     1,005           --             --              --           1,005
                                        ----------    ---------       --------       ---------       ---------
Net cash provided by (used in)
      financing activities..............     1,005           --         (7,086)          6,131              50
                                        ----------    ---------       --------       ---------       ---------

Effect of exchange rate changes in cash.        --           --            (45)             --             (45)
                                        ----------    ---------       --------       ---------       ---------

Net increase (decrease) in cash and
     cash equivalents...................   (12,548)         942         (8,671)             --         (20,277)

Cash and cash equivalents
     at beginning of period.............    19,633        3,130         32,031              --          54,794
                                        ----------    ---------       --------       ---------       ---------

Cash and cash equivalents
      at end of period..................$    7,085    $   4,072       $ 23,360       $      --       $  34,517
                                        ==========    =========       ========       =========       =========

</TABLE>

<PAGE>
NOTE G - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS - CONTINUED

<TABLE>
<CAPTION>

                                          SUPPLEMENTAL CONDENSED CONSOLIDATING BALANCE SHEET
                                                            MARCH 31, 2001
                                                        (THOUSANDS OF DOLLARS)

                                        Parent                          Non-
                                        Company        Guarantor     Guarantor
                                         Only        Subsidiaries    Subsidiaries  Eliminations    Consolidated
                                       ---------     ------------    ------------  ------------    ------------
<S>                                    <C>            <C>             <C>           <C>             <C>

ASSETS
  Current assets:
    Cash and cash equivalents..........$   19,633     $    3,130      $   32,031    $       --      $   54,794
    Accounts receivable................       617         35,055          82,970        (3,879)        114,763
    Inventories........................        --         45,376          36,202            --          81,578
    Prepaid expenses...................       112            552           6,236            --           6,900
                                       ----------     ----------      ----------    ----------      ----------
      Total current assets.............    20,362         84,113         157,439        (3,879)        258,035

  Intercompany investment..............   233,073             --              --      (233,073)             --
  Investments in unconsolidated entities       --             --          17,868            --          17,868
  Intercompany note receivables........   282,268             --              --      (282,268)             --

  Property and equipment--at cost:
    Land and buildings.................       135          3,538           7,317            --          10,990
    Aircraft and equipment.............     5,218        174,708         423,205          (110)        603,021
                                       ----------     ----------      ----------    ----------      ----------
                                            5,353        178,246         430,522          (110)        614,011
  Less:  accumulated depreciation
      and amortization.................    (2,690)       (82,373)        (82,258)           --        (167,321)
                                       ----------     ----------      ----------    ----------      ----------
                                            2,663         95,873         348,264          (110)        446,690
  Other assets.........................    10,063         15,443           6,611           110          32,227
                                       ----------     ----------      ----------    ----------      ----------

                                       $  548,429     $  195,429      $  530,182    $ (519,220)     $  754,820
                                       ==========     ==========      ==========    ==========      ==========

LIABILITIES AND STOCKHOLDERS' INVESTMENT
  Current liabilities:
    Accounts payable...................$      274     $    5,554      $   30,452    $   (3,879)     $   32,401
    Accrued liabilities................     6,860         16,475          40,749          (288)         63,796
    Deferred taxes.....................     1,004             --          14,261            --          15,265
    Current maturities of long-term debt       --             --          13,122            --          13,122
                                       ----------     -----------     ----------    ----------      ----------
     Total current liabilities.........     8,138         22,029          98,584        (4,167)        124,584

  Long-term debt, less current maturities 190,922             --          18,268            --         209,190
  Intercompany notes payable...........     5,069          9,452         267,459      (281,980)             --
  Other liabilities and deferred credits      275          2,841          11,955            --          15,071
  Deferred taxes.......................    12,637         37,963          44,869            --          95,469
  Minority interest....................    11,959             --              --            --          11,959

  Stockholders' investment:
    Common stock.......................       218          4,062              43        (4,105)            218
    Additional paid in capital.........   127,554         53,168          10,507       (63,675)        127,554
    Retained earnings..................   212,029         65,914          75,075      (141,100)        211,918
    Accumulated other comprehensive
      income (loss)....................   (20,372)            --           3,422       (24,193)        (41,143)
                                       ----------     ----------      ----------    ----------      ----------
                                          319,429        123,144          89,047      (233,073)        298,547
                                       ----------     ----------      ----------    ----------      ----------
                                       $  548,429     $  195,429      $  530,182    $ (519,220)     $  754,820
                                       ==========     ==========      ==========    ==========      ==========

</TABLE>

<PAGE>
NOTE G - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS - CONTINUED

<TABLE>
<CAPTION>

                                       SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF INCOME
                                                   THREE MONTHS ENDED JUNE 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                        Parent                          Non-
                                        Company        Guarantor     Guarantor
                                         Only        Subsidiaries    Subsidiaries  Eliminations    Consolidated
                                       ---------     ------------    ------------  ------------    ------------
<S>                                    <C>           <C>              <C>           <C>             <C>

GROSS REVENUE
Operating revenue......................$      102    $    35,929      $ 74,548      $       --      $  110,579
Intercompany revenue...................        --          2,617            85          (2,702)             --
Gain on disposal of assets.............        --             --           670              --             670
                                       ----------    -----------      --------      ----------      ----------
                                              102         38,546        75,303          (2,702)        111,249
OPERATING EXPENSES
Direct cost............................         4         30,715        55,989              --          86,708
Intercompany expense...................        --             85         2,617          (2,702)             --
Depreciation and amortization..........       100          2,566         6,163              --           8,829
General and administrative.............     1,514          1,713         3,612              --           6,839
                                       ----------    -----------      --------      ----------      ----------
                                            1,618         35,079        68,381          (2,702)        102,376
                                       ----------    -----------      --------      ----------      ----------

OPERATING INCOME (LOSS)................    (1,516)         3,467         6,922              --           8,873

Equity in earnings from unconsolidated
     entities..........................     2,365             --         1,019          (2,365)          1,019
Interest income........................     7,638             42           507          (7,448)            739
Interest expense.......................     3,456              9         8,317          (7,448)          4,334
                                       ----------    -----------      --------      ----------      ----------

INCOME BEFORE PROVISION
     FOR INCOME TAXES AND
     MINORITY INTEREST.................     5,031          3,500           131          (2,365)          6,297
Allocation of consolidated income taxes       687          1,226            40              --           1,953
Minority interest......................      (347)            --            --              --            (347)
                                       ----------    -----------      --------      ----------      ----------

NET INCOME.............................$   3,997     $     2,274      $     91      $   (2,365)     $    3,997
                                       =========     ===========      ========      ==========      ==========
</TABLE>

<PAGE>
NOTE G - SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL STATEMENTS - CONTINUED

<TABLE>
<CAPTION>

                                     SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
                                                   THREE MONTHS ENDED JUNE 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                          Parent                        Non-
                                          Company    Guarantor       Guarantor
                                           Only      Subsidiaries    Subsidiaries  Eliminations    Consolidated
                                         --------    ------------    ------------  ------------    ------------
<S>                                     <C>           <C>             <C>            <C>             <C>

Net cash provided by (used in)
     operating activities...............$   (8,632)   $   1,174       $  2,242       $   7,230       $   2,014
                                        ----------    ---------       --------       ---------       ---------

Cash flows from investing activities:
     Capital expenditures...............      (186)      (1,107)       (10,911)             --         (12,204)
     Proceeds from asset dispositions...        --           --          2,024              --           2,024
     Investments........................        --           --         (1,200)             --          (1,200)
                                        ----------    ---------       --------       ---------       ---------
Net cash provided by (used in)
     investing activities...............      (186)      (1,107)       (10,087)             --         (11,380)
                                        ----------    ---------       --------       ---------       ---------

Cash flows from financing activities:
     Proceeds from borrowings...........        --           --          7,230          (7,230)             --
     Repayment of debt..................        --           --         (6,937)             --          (6,937)
                                        ----------    ---------       --------       ---------       ---------
Net cash provided by (used in)
     financing activities...............        --           --            293          (7,230)         (6,937)
                                        ----------    ---------       --------       ---------       ---------

Effect of exchange rate changes in cash.        --           --           (799)             --            (799)
                                        ----------    ---------       --------       ---------       ---------

Net increase (decrease) in cash and
     cash equivalents...................    (8,818)          67         (8,351)             --         (17,102)

Cash and cash equivalents
     at beginning of period.............    14,537        2,323         21,075              --          37,935
                                        ----------    ---------       --------       ---------       ---------

Cash and cash equivalents
      at end of period..................$    5,719    $   2,390       $ 12,724       $      --       $  20,833
                                        ==========    =========       ========       =========       =========

</TABLE>

<PAGE>
Item 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

     The Company,  through its Air Logistics'  subsidiaries ("Air Log") and with
its investment in Bristow  Aviation  Holdings  Limited  ("Bristow"),  is a major
supplier of helicopter transportation services to the worldwide offshore oil and
gas industry.  The Company also provides  production  management services to the
domestic  offshore  oil and gas industry  through its wholly  owned  subsidiary,
Grasso Production Management, Inc. ("GPM").

RESULTS OF OPERATIONS

     A summary of operating  results and other income statement  information for
the applicable periods is as follows (in thousands of dollars):

                                                      THREE MONTHS ENDED
                                                           JUNE 30,
                                                    --------------------
                                                       2001       2000
                                                    --------     -------

Operating revenue.................................. $123,284   $ 110,579
Gain on disposal of assets.........................      425         670
Operating expenses................................. (104,457)   (102,376)
                                                    --------   ---------

Operating income...................................   19,252       8,873

Equity in earnings from unconsolidated entities....      962       1,019
Interest income (expense), net.....................   (3,211)     (3,595)
                                                    --------   ---------

Income before provision for income taxes
   and minority interest...........................   17,003       6,297
Provision for income taxes.........................    5,270       1,953
Minority interest..................................     (362)       (347)
                                                    --------   ---------

Net income......................................... $ 11,371   $   3,997
                                                    ========   =========


     The following table sets forth certain operating  information,  which forms
the basis for  discussion  of each of the  Company's  two  identified  segments,
helicopter  activities  and  production  management  and related  services.  The
respective  international  operations  of Air Log  (headquartered  in the United
States)  and  Bristow  (headquartered  in the United  Kingdom)  are  managed and
reported as a separate  division.  The  International  division  encompasses all
helicopter  activities  outside of the United  States  Gulf of Mexico and Alaska
(reported as "Air Log") and the United  Kingdom and Europe  Sectors of the North
Sea (reported as "Bristow").




<PAGE>
                                           THREE MONTHS ENDED JUNE 30,
                                           --------------------------
                                              2001             2000
                                           -----------      ---------
                                      (IN THOUSANDS, EXCEPT FLIGHT HOURS)

Flight hours (excludes unconsolidated entities):
  Helicopter Activities:
    Air Log..............................      36,085          26,049
    Bristow..............................      12,534          13,355
    International........................      22,161          17,466
                                           ----------       ---------
      Total..............................      70,780          56,870
                                           ==========       =========

Operating revenues:
  Helicopter Activities:
     Air Log.............................  $   37,915       $  25,924
     Bristow.............................      39,765          42,774
     International.......................      37,118          32,326
     Less:  Intercompany.................      (2,591)           (496)
                                           ----------       ---------
      Total..............................     112,207         100,528
  Production management and related
      services...........................      12,044          11,022
  Corporate..............................       2,680           2,463
  Less:  Intercompany....................      (3,647)         (3,434)
                                           ----------       ---------
      Consolidated total.................  $  123,284       $ 110,579
                                           ==========       =========

Operating income, excluding gain or loss
     on disposal of assets:
  Helicopter Activities:
     Air Log.............................  $    7,708       $   2,871
     Bristow.............................       3,089          (1,241)
     International.......................       7,545           6,189
                                           ----------       ---------
      Total..............................      18,342           7,819
  Production management and related
      services...........................         813             666
  Corporate..............................        (328)           (282)
                                           ----------       ---------
      Consolidated total.................  $   18,827       $   8,203
                                           ==========       =========

Gross margin, excluding gain or loss on disposal of assets:
  Helicopter Activities:
     Air Log.............................       20.3%           11.1%
     Bristow.............................        7.8%           (2.9%)
     International.......................       20.3%           19.1%
      Total..............................       16.3%            7.8%
  Production management and related
      services...........................        6.8%            6.0%
      Consolidated total.................       15.3%            7.4%


<PAGE>
      HELICOPTER ACTIVITIES

     Air Log and Bristow conduct helicopter  activities  principally in the Gulf
of Mexico and the North Sea,  respectively,  where they  provide  support to the
production,  exploration and  construction  activities of oil and gas companies.
Air  Log  also  charters  helicopters  to  governmental   entities  involved  in
regulating  offshore oil and gas  operations  in the Gulf of Mexico and provides
helicopter  services to the Alyeska  Pipeline in Alaska.  Bristow also  provides
search and rescue work for the British Coast Guard.  International's  activities
include Air Log and Bristow's operations in the following countries:  Australia,
Brazil,  Brunei, China, Colombia,  Congo, Ecuador,  India,  Kazakhstan,  Kosovo,
Macedonia,   Mexico,   Nigeria,   Spain,   The  Maldives  and  Trinidad.   These
international  operations are subject to local  governmental  regulations and to
uncertainties of economic and political conditions in those areas. International
also  includes Air Log's  service  agreements  with,  and equity  interests  in,
entities  that  operate  aircraft in Brazil,  Egypt and Mexico  ("unconsolidated
entities").

     Operating revenues from helicopter activities increased by 11.6% during the
three months ended June 30, 2001 over the prior year  comparable  quarter,  with
operating  expenses  increasing by only 1.2%. This led to an operating margin of
16.3%  as  compared  to 7.8% in the  similar  quarter  in the  prior  year.  The
improvement  in margin  was due to  increased  revenue  from the  resurgence  of
activity  in the Gulf of Mexico  and  international  markets  coupled  with rate
increases in both the Gulf of Mexico and the North Sea.

Air Log
-------
     Air Log's  flight  hours and revenue  increased  during the current  fiscal
quarter by 38.5% and 46.3%, respectively,  from the similar quarter in the prior
year.  The  disparity in the increase in revenue in relation to flight hours was
due to a shift in the mix of  aircraft  generating  revenue.  Flight  hours  and
revenue  generated  from  larger,  crew  change  aircraft  in the Gulf of Mexico
increased 43% and 62%, respectively, from the similar quarter in the prior year,
while smaller,  production related aircraft increased 43% and 44%, respectively.
Air Log's  operating  margin of 20.3% for the three  months  ended June 30, 2001
compares to 11.1% in the similar  quarter in the prior year and is reflective of
the increase in flight  activity and rate increases  averaging 6% and 30%, which
went into  effect in  January  and June 2001,  respectively.  The June 2001 rate
increase is expected to be phased-in over the next two quarters,  and by January
1, 2002, all of Air Log's customers will be under the new rate structure.

     Subsequent  to June 30, 2001,  Air Log increased its wage rates for pilots,
mechanics and other operational employees in response to increases in the market
wages for these  employee  groups.  As a result,  salary costs are  projected to
increase,  assuming current staffing levels remain unchanged, by $3.0 million on
an annual basis effective July 2, 2001.

     Currently  the  drilling  rig  utilization  in the Gulf of Mexico is at its
lowest  level  since  April 2000.  While the  Company  has not  experienced  any
reduction in flight  hours on aircraft on contract to date,  should the downward
trend in  drilling  activity  continues,  Air Log could  begin to  experience  a
reduction in the demand for its services.

Bristow
-------
     Bristow's   flight   hours  and  revenue   decreased   by  6.1%  and  7.0%,
respectively, during the quarter from the similar period in the prior year. This
decrease in flight  revenue is the net result of an increase in North Sea flight
revenue, offset by a decrease in flight revenue in Norway. The increase in North
Sea revenue stems from a combination of increased oil industry activity and rate
increases  Bristow has achieved on customer  contracts both  mid-term,  and upon
renewal.  Additionally, the tightening of the supply of helicopters in the North
Sea has resulted in premium rates being charged for ad hoc flights,  with little
incremental costs associated with those flights.

     The decrease in revenue in Norway is due to an accounting change during the
quarter ended June 30, 2001,  whereby the results of Bristow's  Norwegian  joint
venture will no longer be consolidated into the Company's financial  statements.
The  venture  will  instead  be  treated  as an  unconsolidated  entity  and the
investment  accounted for under the cost method of accounting (See Note A in the
"Notes to Consolidated Financial  Statements").  If the Company had continued to
consolidate the joint venture, Bristow's flight revenues would have increased by
6.2%, during the quarter as compared to the similar period in the prior year.

<PAGE>
     Bristow's  operating margin increased from (2.9)% in the quarter ended June
30,  2000 to 7.8% in the  current  quarter.  This  improvement  in margin is due
primarily  to the  activity  and rate  increases  in the North Sea as  discussed
above.

     The  prevailing  market rate for  qualified  personnel  in the North Sea is
under  pressure  from labor  unions and  employee  groups.  Bristow will have to
increase  wages in order to  retain  qualified  personnel.  Management  does not
believe that salary adjustments made to reflect current market levels will place
it at a competitive disadvantage.

International
-------------
     Internationally,  flight  hours and  revenue  increased  during the current
fiscal quarter by 26.9% and 14.8%, respectively, from the similar quarter in the
prior year.  An increase in activity was prevalent in Brazil,  Colombia,  Mexico
and  Nigeria.  In Nigeria  revenues  were up 7.6% over the prior year quarter as
drilling  activities in Nigeria continued to improve. In Mexico revenues were up
27% over the prior year  quarter  primarily  due to the $75  million  three year
contract  awarded  to the  Company's  49% owned  affiliate  in Mexico to provide
helicopter transportation services to the Federal Electric Commission of Mexico.
Most of the  aircraft  needed to fulfill  the  contract  requirements  are being
leased from Air Log. The contract phased-in over a two-month period, which began
March 31, 2000.  This contract  generated  lease revenue of  approximately  $3.0
million  during the current  quarter  compared to $2.0 million in the prior year
quarter.

      PRODUCTION MANAGEMENT AND RELATED SERVICES

     Operating  revenues for GPM increased by 9.3% during the three months ended
June 30, 2001, as compared to the similar period in the prior year. The increase
in revenue is primarily due to new  contracts.  GPM's  operating  margin of 6.8%
during the current quarter is comparable to the margin in the similar quarter in
the prior year.

      CORPORATE AND OTHER

     Consolidated  net interest  expense  declined  slightly  during the current
quarter due to interest income of approximately $0.4 million on refunds of prior
taxes  received  in  the  current  year.  The  effective  income  tax  rate  was
approximately   31%  for  the  three  months  ended  June  30,  2001  and  2000,
respectively.

LIQUIDITY AND CAPITAL RESOURCES

     Cash and cash  equivalents  were $34.5 million as of June 30, 2001, a $20.2
million  decrease from March 31, 2001.  Working  capital as of June 30, 2001 was
$128.3  million,  a $5.2 million  decrease  from March 31, 2001.  Total debt was
$221.0 million as of June 30, 2001.

     As of June 30,  2001,  Bristow  had a  (pound)15  million  ($21.1  million)
revolving  credit  facility  with a syndicate  of United  Kingdom  banks that is
currently  on a month to  month  extension  while  management  renegotiates  the
renewal  terms and  conditions  of this  facility.  Bristow had no amounts drawn
under this facility as of June 30, 2001, but did have  (pound)1.4  million ($2.0
million)  of  outstanding  guarantees  of  certain  obligations,  which  reduced
availability  under  the  line.  As of June 30,  2001,  OLOG  had a $20  million
unsecured  working  capital line of credit with a bank that expires on September
30,  2001.  Management  plans to renew this line of credit upon  expiration.  No
funds were drawn under this  facility as of June 30, 2001.  Management  believes
that its normal operations, lines of credit and available financing will provide
sufficient  working  capital  and cash flow to meet debt  service  needs for the
foreseeable future.

<PAGE>
     During the quarter ended June 30, 2001,  the Company  received  proceeds of
$1.8 million  primarily from the disposition of two aircraft and purchased three
Bell 412s for $14.5 million, three Bell 407s for $4.0 million and three 206 L-4s
for $2.7 million.  Subsequent to June 30, 2001,  the Company  purchased one Bell
412 for  $5.0  million  and  one  Bell  407 for  $1.3  million.  These  aircraft
acquisitions were made with existing cash. The Company has purchase  commitments
on two  additional  Bell  407s and two  additional  Bell  412s.  These  aircraft
purchases  were made to  fulfill  customer  contract  requirements.  During  the
quarter ended June 30, 2000, the Company received  proceeds of $2.0 million from
the sale of non-aviation assets.

LEGAL MATTERS

     The Company  has  received  notices  from the United  States  Environmental
Protection  Agency that it is one of approximately  160 potentially  responsible
parties ("PRP") at one Superfund site in Texas, one of over 300 PRPs at one site
in Louisiana and a PRP at one site in Rhode Island. The Company believes,  based
on presently  available  information,  that its potential liability for clean up
and other response costs in connection  with these sites is not likely to have a
material adverse effect on the Company's business or financial condition.

RECENT ACCOUNTING PRONOUNCEMENTS

     Effective  April 1,  2001,  the  Company  adopted  Statement  of  Financial
Accounting  Standards  ("SFAS")  No. 138,  "Accounting  for  Certain  Derivative
Instruments and Hedging Activities",  that amends certain provisions of SFAS No.
133,  "Accounting  for  Derivative  Instruments  and  Hedging  Activities".  The
pronouncements  require that all  derivatives  be recognized as either assets or
liabilities  and  measured  at fair  value.  The  adoption  of SFAS No.  133, as
amended, did not have a material impact on the Company's financial statements.

     On July 20, 2001, the Financial  Accounting Standards Board issued SFAS No.
142, "Goodwill and Other Intangible  Assets",  which establishes a new method of
testing goodwill for impairment using a  fair-value-based  approach and does not
permit amortization of goodwill as previously required by Accounting  Principles
Board Opinion No. 17, "Intangible  Assets". An impairment loss would be recorded
if the  recorded  goodwill  exceeds  its  implied  fair  value.  SFAS No. 142 is
effective for fiscal years  beginning  after December 15, 2001;  however,  early
adoption is allowed for companies  with fiscal years  beginning  after March 15,
2001 provided that first quarter  financial  statements have not been previously
issued.  The Company  did not elect to early  adopt SFAS No.  142.  Accordingly,
goodwill  amortization  expense of $0.3 million was recorded  during the quarter
ended June 30, 2001 and similar quarterly amounts are expected for the remainder
of the year.

     The  FASB  also  recently  issued  SFAS  No.  143,  "Accounting  for  Asset
Retirement  Obligations".  This  statement,  which is first  effective  in 2003,
covers the accounting for closure or  removal-type  costs that are incurred with
respect  to  long-lived  assets.  The  nature  of  the  Company's  business  and
long-lived  assets is such that  adoption  of this new  standard  should have no
significant impact on the Company's financial position or results of operations.

FORWARD-LOOKING STATEMENTS

     This report  contains  "forward-looking  statements"  within the meaning of
Section 27A of the  Securities  Act of 1933, as amended,  and Section 21E of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements
included  herein other than  statements of historical  fact are  forward-looking
statements.

<PAGE>
     Although  the Company  believes  that the  expectations  reflected  in such
forward-looking  statements are  reasonable,  it can give no assurance that such
expectations will prove to be correct. Important factors that could cause actual
results  to  differ  materially  from the  Company's  expectations  ("Cautionary
Statements") may include,  but are not limited to, demand for Company  services,
worldwide  activity levels in oil and natural gas  exploration,  development and
production,  fluctuations  in oil and natural gas prices,  unionization  and the
response   thereto   by  the   Company's   customers,   currency   fluctuations,
international political conditions and the ability to manage operating expenses.
All subsequent written and oral forward-looking  statements  attributable to the
Company  or  persons  acting on its  behalf  are  expressly  qualified  in their
entirety by the Cautionary Statements.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.


     The Company does use  off-balance  sheet hedging  instruments to manage its
risks associated with its operating  activities conducted in foreign currencies.
In limited  circumstances  and when  considered  appropriate,  the Company  will
utilize  forward  exchange  contracts  to hedge  anticipated  transactions.  The
Company has  historically  used these  instruments  primarily  in the buying and
selling of certain spare parts,  maintenance services and equipment. The Company
attempts to minimize its exposure to foreign  currency  fluctuations by matching
its  revenues  and  expenses in the same  currency  for its  contracts.  Most of
Bristow's  revenues and  expenses are  denominated  in British  Pounds  Sterling
("pound").  As of June 30, 2001, the Company has nine nominal  forward  exchange
contracts for Euros  totaling $20 million,  with lives  generally  less than one
year. The fair market value of these contracts at June 30, 2001 is not material.
Management  does not  believe  that its  limited  exposure  to foreign  currency
exchange risk necessitates the extensive use of forward exchange contracts.





<PAGE>
                           PART II - OTHER INFORMATION


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(b)   Reports on Form 8-K:

           There were no Form 8-K filings during the quarter ended June 30,
         2001.





<PAGE>
                                   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.


                                    OFFSHORE LOGISTICS, INC.


                                    BY:             /s/ H. Eddy Dupuis
                                               -------------------------------
                                                        H. Eddy Dupuis
                                        Vice President - Chief Financial Officer


                                    DATE:   August 14, 2001







