<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10Q

(Mark One)

  [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
           EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 2001

                                       OR

  [x]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
           EXCHANGE ACT OF 1934

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

Commission file number  1-16337           
                      -----------


                         OIL STATES INTERNATIONAL, INC.

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

             (Exact name of registrant as specified in its charter)

                Delaware                                 76-0476605
    (State or other jurisdiction of                   (I.R.S. Employer
     incorporation or organization)                  Identification No.)


 Three Allen Center, 333 Clay Street, Suite 3460,           77002
                 Houston, Texas                           (Zip Code)   
    (Address of principal executive offices)       

                                 (713) 652-0582
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)
                                                                           
                                      None
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)
                                                                             
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                                                         YES  [X]    NO  [ ]

The Registrant had 48,232,207 shares of common stock outstanding as of November
9, 2001.



<PAGE>



                         OIL STATES INTERNATIONAL, INC.

                                      INDEX


<Table>
<Caption>

                                                                                        PAGE NO. 
                                                                                        --------
<S>          <C>                                                                        <C>              

             Part I -- FINANCIAL INFORMATION


 Item 1.     Financial Statements:

             Unaudited Pro Forma Consolidated and Combined Financial Statements
             Unaudited Pro Forma Consolidated and Combined Statements of Operations
                for the Three Months Ended September 30, 2000                                4
             Unaudited Pro Forma Consolidated and Combined Statements of Operations
                for the Nine Months Ended September 30, 2001 and 2000                      5 - 6
             Notes to Unaudited Pro Forma Consolidated and Combined Financial
                Statements                                                                 7 - 8

             Consolidated and Combined Financial Statements
             Unaudited Consolidated and Combined Statements of Operations for the 
                Three and Nine Months Ended September 30, 2001 and 2000                      9
             Consolidated and Combined Balance Sheets -- September 30, 2001
                (unaudited) and December 31, 2000                                            10
             Unaudited Consolidated and Combined Statements of Cash Flows for the 
                Nine Months Ended September 30, 2001 and 2000                                11
             Notes to Unaudited Consolidated and Combined Financial Statements            12 - 15


 Item 2.     Management's Discussion and Analysis of Financial Condition and Results
                of Operations                                                             16 - 24


 Item 3.     Quantitative and Qualitative Disclosures About Market Risk                      24


             Part II -- OTHER INFORMATION


 Item 6.     Exhibits and Reports on Form 8-K

             (a) Index of Exhibits                                                        25 - 26

             (b) Report on Form 8-K                                                          26

             Signature Page                                                                  27
</Table>





                                       2

<PAGE>



                         OIL STATES INTERNATIONAL, INC.

       UNAUDITED PRO FORMA CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS

         The following tables set forth unaudited pro forma consolidated and
combined financial information for Oil States International, Inc. (Oil States)
giving effect to:

         o    the combination of Oil States, HWC Energy Services, Inc. (HWC) and
              PTI Group Inc. (PTI) (collectively, the Controlled Group) as
              entities under the common control of SCF-III L.P. (SCF-III), based
              upon reorganization accounting, which yields results similar to
              pooling of interest accounting, effective from the dates each of
              these entities became controlled by SCF-III (the Combination);

         o    the conversion of the common stock held by the minority interests
              of each entity in the Controlled Group into shares of our common
              stock, based on the purchase method of accounting;

         o    the conversion of all of the outstanding common stock of Sooner
              Inc. (Sooner) into shares of our common stock, based on the
              purchase method of accounting; and

         o    the exchange of 4,275,555 shares of common stock for $36.0 million
              of debt of Sooner and Oil States (the SCF Exchange); and

         o    our sale of 10,000,000 shares of common stock (the Offering) and
              the application of the net proceeds to us.

         The unaudited pro forma consolidated and combined statements of
operations for the three month and nine month periods ended September 30, 2001
and 2000, respectively, were prepared based upon the historical combined
financial statements of the Controlled Group, adjusted to conform accounting
policies, and give effect to:

         o    our acquisition of minority interests of the Controlled Group;

         o    our acquisition of Sooner;

         o    our exchange of shares of common stock for debt of Sooner and Oil
              States; and

         o    our sale of shares in the Offering,

as if these transactions had occurred on January 1, 2000.

         The unaudited pro forma consolidated and combined financial statements
do not purport to be indicative of the results that would have been obtained had
the transactions described above been completed on the indicated dates or that
may be obtained in the future. The unaudited pro forma consolidated and combined
financial statements should be read in conjunction with the historical combined
financial statements and notes thereto included in the Oil States' Annual Report
on Form 10-K.


                                        3

<PAGE>



                   PRO FORMA COMBINED STATEMENT OF OPERATIONS

                  FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2000
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                   (UNAUDITED)

<Table>
<Caption>
                                                                                PRO FORMA
                                     -----------------------------------------------------------------------------------------------
                                                                                        MINORITY
                                                                     SOONER INC.        INTEREST          OFFERING        COMBINED,
                                       COMBINED                      ADJUSTMENTS       ADJUSTMENTS       ADJUSTMENTS    ACQUISITIONS
                                         GROUP      SOONER INC.       (NOTE 2)          (NOTE 3)       (NOTES 1 AND 4)  AND OFFERING
                                     ------------ --------------  ----------------  ---------------- ------------------ ------------
<S>                                  <C>            <C>              <C>               <C>              <C>             <C>
Revenue...........................     $ 67,525       $58,925          $                 $                 $              $ 126,450
Costs and Expenses:
  Cost of sales...................       48,618        53,252                                                               101,870
  Selling, general and
    administrative................        9,845         1,872                                                  10(B)         11,727
  Depreciation and amortization...        5,034           382             663               366                               6,445
  Other expense (income)..........          (48)           (2)                                                                  (50)
                                       --------       -------          ------            ------            ------         --------- 
Operating income (loss)...........        4,076         3,421            (663)             (366)              (10)            6,458
                                       --------       -------          ------            ------            ------         ---------
Interest income...................           --                                                                                  --
Interest expense..................       (2,892)         (976)                                              1,533(A)         (2,335)
Other income (expense)............          (70)                                                                                (70)
                                       --------       -------          ------            ------            ------         --------- 
  Income (loss) before income 
    taxes.........................        1,114         2,445            (663)             (366)            1,523             4,053
Income tax (expense) benefit......       (1,983)         (542)                                              1,950(D)           (575)
                                       --------       -------          ------            ------            ------         --------- 
Net Income (loss) before 
  minority interests..............         (869)        1,903            (663)             (366)            3,473             3,478
Minority interests, net 
  of taxes........................         (201)                                                              198                (3)
                                       --------       -------          ------            ------            ------         ---------
Net income (loss) before 
  preferred dividends.............       (1,070)        1,903            (663)             (366)            3,671             3,475
Preferred dividends...............          (84)                                                               84(C)             --
                                       --------       -------          ------            ------            ------         ---------
Net income (loss) attributable 
  to common shares................     $ (1,154)      $ 1,903          $ (663)           $ (366)           $3,755         $   3,475
                                       ========       =======          ======            ======            ======         =========
Net income (loss) per 
  common share
  Basic...........................     $   (.05)                                                                          $    0.07
                                       ========                                                                           =========
  Diluted.........................     $   (.05)                                                                          $    0.07
                                       ========                                                                           =========
Average shares outstanding
  Basic...........................       24,665                                                                              48,181
                                       ========                                                                           =========
  Diluted.........................       24,665                                                                              48,421
                                       ========                                                                           =========
</Table>





                                       4

<PAGE>



                 PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS

                  FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                   (UNAUDITED)


<Table>
<Caption>
                                                                            PRO FORMA 
                                ----------------------------------------------------------------------------------------------------
                                                      SOONER INC.                      MINORITY
                                                     (PERIOD FROM       SOONER INC.    INTEREST         OFFERING       CONSOLIDATED,
                                   CONSOLIDATED     JAN. 1, 2001 TO     ADJUSTMENTS   ADJUSTMENTS      ADJUSTMENTS     ACQUISITIONS
                                       GROUP        FEB. 14, 2001)       (NOTE 2)      (NOTE 3)      (NOTES 1 AND 4)   AND OFFERING
                                -----------------  ----------------  ----------------------------------------------- ---------------
<S>                             <C>                 <C>               <C>            <C>              <C>                  <C>  
Revenue........................    $ 491,820          $ 48,516           $             $                $                 $540,336
Costs and Expenses:
  Cost of sales................      390,191            45,141                                                             435,332
  Selling, general and
    administrative.............       38,412             1,133                                                              39,545
  Depreciation and
    amortization...............       20,476               188              331           135                               21,130
  Other income.................         (210)               (1)                                                               (211)
                                   ---------          --------           ------        ------           ------            --------
Operating income (loss)........       42,951             2,055             (331)         (135)                              44,540
                                   ---------          --------           ------        ------           ------            --------
Interest income................          465                22                                                                 487
Interest expense...............       (7,809)             (586)                                            843(A)           (7,552)
Other expense..................         (160)                                                                                 (160)
                                   ---------          --------           ------        ------           ------            --------
  Income before income 
    taxes......................       35,447             1,491             (331)         (135)             843              37,315
Income tax (expense) 
  benefit......................       (1,471)             (542)                                            438(D)           (1,575)
                                   ---------          --------           ------        ------           ------            --------
Net income (loss) before
  minority interests...........       33,976               949             (331)         (135)           1,281              35,740

Minority interests, net of
  taxes........................       (1,598)                                                            1,601                   3
                                   ---------          --------           ------        ------           ------            --------
Net income (loss) before
  extraordinary item...........       32,378               949             (331)         (135)           2,882              35,743
Extraordinary loss on debt
  restructuring................         (784)                                                                                 (784)
                                   ---------          --------           ------        ------           ------            --------
Net income (loss) before
  preferred dividends..........       31,594               949             (331)         (135)           2,882              34,959

Preferred dividends............          (41)                                                               41(C)               --
                                   ---------          --------           ------        ------           ------            --------
Net income (loss) attributable
  to common shares.............    $  31,553          $    949           $ (331)       $ (135)          $2,923            $ 34,959
                                   =========          ========           ======        ======           ======            ========

Net income per common share
  Basic........................    $     .71                                                                              $   0.73
                                   =========                                                                              ========
  Diluted......................    $     .70                                                                              $   0.72
                                   =========                                                                              ========
Average shares outstanding
  Basic........................       44,274                                                                                48,187
                                   =========                                                                              ========
  Diluted......................       45,228                                                                                48,660
                                   =========                                                                              ========
</Table>





                                       5

<PAGE>



                   PRO FORMA COMBINED STATEMENT OF OPERATIONS

                  FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                   (UNAUDITED)


<Table>
<Caption>
                                                                                 PRO FORMA
                                   -------------------------------------------------------------------------------------------------
                                                                                      MINORITY
                                                                   SOONER INC.        INTEREST          OFFERING       CONSOLIDATED,
                                     COMBINED                      ADJUSTMENTS       ADJUSTMENTS       ADJUSTMENTS     ACQUISITIONS
                                       GROUP      SOONER INC.       (NOTE 2)          (NOTE 3)       (NOTES 1 AND 4)   AND OFFERING
                                   ------------ --------------  ----------------  ---------------- ------------------ --------------
<S>                                 <C>         <C>              <C>               <C>               <C>                 <C>
Revenue..........................    $223,911      $ 213,495        $                  $                 $                 $437,406
Costs and Expenses:
  Cost of sales..................     159,266        192,856                                                                352,122
  Selling, general and
    administrative...............      29,132          5,983                                                484(B)           35,599
  Depreciation and amortization..      15,666          1,106           1,980            1,101                                19,853
  Other income...................         (65)                                                                                  (65)
                                     --------      ---------        --------           ------            ------            --------
Operating income (loss)..........      19,912         13,550          (1,980)          (1,101)             (484)             29,897
                                     --------      ---------        --------           ------            ------            --------
Interest income..................          13            338                                                                    351
Interest expense.................      (8,552)        (3,083)                                             4,598(A)           (7,037)
Other income.....................          34              1                                                                     35
                                     --------      ---------        --------           ------            ------            --------
  Income before income taxes.....      11,407         10,806          (1,980)          (1,101)            4,114              23,246
Income tax (expense) benefit.....      (8,416)          (772)                                             5,850(D)           (3,338)
                                     --------      ---------        --------           ------            ------            --------
Net Income (loss) before 
  minority interests.............       2,991         10,034          (1,980)          (1,101)            9,964              19,908
Minority interests, net 
  of taxes.......................      (2,873)            --                                              2,860                 (13)
                                     --------      ---------        --------           ------            ------            --------
Net income (loss) before
  preferred dividends............         118         10,034          (1,980)          (1,101)           12,824              19,895
Preferred dividends..............        (248)            --                                                248(C)               --
                                     --------      ---------        --------           ------            ------            --------
Net income (loss) attributable 
  to common shares...............    $   (130)     $  10,034        $ (1,980)         $(1,101)          $13,072            $ 19,895
                                     ========      =========        ========          =======           =======            ========

Net income per common share
  Basic..........................    $   (.01)                                                                             $   0.41
                                     ========                                                                              ========
  Diluted........................    $   (.01)                                                                             $   0.41
                                     ========                                                                              ========
Average shares outstanding
  Basic..........................      24,407                                                                                48,173
                                     ========                                                                              ========
  Diluted........................      24,407                                                                                48,421
                                     ========                                                                              ========
</Table>




                                       6

<PAGE>


                         OIL STATES INTERNATIONAL, INC.

   NOTES TO UNAUDITED PRO FORMA CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS

BASIS OF PRESENTATION

         The purchase method of accounting has been used to reflect the
acquisition of the minority interests of each company in the Controlled Group
concurrent with the closing of the Offering. The purchase price is based on the
fair value of the shares owned by the minority interests, valued at the initial
public offering price of $9.00 per share. Under this accounting method, the
excess of the purchase price over the fair value of the assets and liabilities
allocable to the minority interests acquired has been reflected as goodwill.
Where book value of minority interests exceeded the purchase price, such excess
reduced property, plant and equipment. The estimated fair values of assets and
liabilities are preliminary and subject to change. For purposes of the pro forma
consolidated and combined financial statements, the goodwill recorded in
connection with this transaction is being amortized over 20 years using the
straight-line method based on management's evaluation of the nature and duration
of customer relationships and considering competitive and technological
developments in the industry. The unaudited pro forma consolidated and combined
statements of operations for the nine month period ended September 30, 2001 and
the three and nine month periods ended September 30, 2000 have been adjusted for
the effects of purchase accounting, as described below.

         The purchase method of accounting also has been used to reflect the
acquisition of the outstanding common stock of Sooner concurrent with the
closing of the Offering on February 14, 2001. The purchase price is based on the
fair value of the shares of Sooner, valued at the initial public offering price
of $9.00 per share. The excess of the purchase price over the fair value of the
assets and liabilities of Sooner has been reflected as goodwill. The estimated
fair values of assets and liabilities are preliminary and subject to change. For
purposes of the pro forma consolidated and combined financial statements, the
goodwill recorded in connection with this transaction is being amortized over 15
years using the straight-line method based on management's evaluation of the
nature and duration of customer relationships and considering competitive and
technological developments in the industry. The unaudited pro forma consolidated
and combined statements of operations for the nine month period ended September
30, 2001 and the three and nine month periods ended September 30, 2000 include
the historical financial statements of Sooner prior to the acquisition, for the
entire three and nine month periods ended September 30, 2000 and for the period
from January 1, 2001 to February 14, 2001. Subsequent to the acquisition,
Sooner's results are included with the results of the Consolidated Group.

NOTE 1 -- COMBINING ADJUSTMENTS

    Sooner's results from its February 14, 2001 acquisition date are included
with the historical results of the Controlled Group. Minority interest in income
(loss) and related tax effect of the Controlled Group are presented below (in
thousands):


<Table>
<S>                                                 <C>
                                                      TOTAL    
          Three Months Ended September 30, 2000     $   198
                                                    =======
          Nine Months Ended September 30, 2000      $ 2,860
                                                    =======
          Nine Months Ended September 30, 2001      $ 1,601
                                                    =======
</Table>


NOTE 2 -- ACQUISITION OF SOONER

    Certain reclassifications have been made to conform the presentation of
Sooner's financial statements to that of the Controlled Group.

    To reflect the acquisition of all outstanding common shares of Sooner in
exchange for 7,597,152 shares of Oil States common stock valued at the offering
price per share of $9.00 (in millions):


<Table>
<S>                                                                 <C>
    Purchase price................................................   $  69.5(1)
    Less: Fair value of net assets acquired.......................      29.7
                                                                     -------
    Goodwill......................................................             $  39.8
                                                                               =======
    Amortization for the three months ended September 30, 2000....             $   .66
                                                                               =======
    Amortization for the nine months ended September 30, 2000.....             $  1.98
                                                                               =======
    Amortization for the period from January 1, 2001 to February
    14, 2001......................................................             $   .33
                                                                               =======
</Table>

----------

(1) The purchase price for Sooner includes the estimated fair value of Sooner
    stock options ($1.1 million) converted into Oil States stock options.


                                       7

<PAGE>

NOTE 3 -- ACQUISITION OF MINORITY INTERESTS

         To reflect the acquisition of the minority interests of each company in
the Controlled Group in exchange for shares of Oil States common stock and
elimination of the historical minority interests amounts reflected for the
Controlled Group (in millions):


<Table>
<S>                                                                 <C>
         Amortization of the additional goodwill for
           the three months ended September 30, 2000......           $  .37
                                                                     ======
         Amortization of the additional goodwill for the
           nine months ended September 30, 2000 ..........           $ 1.10
                                                                     ======
         Amortization of the additional goodwill for
           the period from January 1, 2001 to
           February 14, 2001..............................           $  .13
                                                                     ======
</Table>


NOTE 4 -- OFFERING

(A)  To adjust interest expense for debt repaid with Offering proceeds and as a
     result of the exchange of shares for subordinated debt.

(B)  To adjust for costs associated with the new corporate office, including
     executives hired in connection with the Offering, which costs are not fully
     reflected in the historical financial statements. These costs will have a
     continuing impact on our operations.

(C)  To eliminate preferred stock dividends due to the conversion of the
     preferred stock.

(D)  To adjust income tax expense for the reduction in deferred taxes due to the
     formation of the consolidated group.




                                       8

<PAGE>
                 OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

          UNAUDITED CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)


<Table>
<Caption>
                                                       THREE MONTHS ENDED SEPTEMBER 30,           NINE MONTHS ENDED SEPTEMBER 30,
                                                       --------------------------------           --------------------------------
                                                           2001                   2000                2001                 2000
                                                       ----------              --------           ----------            ----------
<S>                                                     <C>                     <C>                <C>                  <C>      
Revenues.........................................       $ 173,510               $67,525            $ 491,820            $ 223,911

Costs and expenses:
  Cost of sales..................................         140,390                48,618              390,191              159,266
  Selling, general and administrative expenses...          12,974                 9,845               38,412               29,132
  Depreciation expense...........................           5,200                 4,243               15,172               13,328
  Amortization expense...........................           1,957                   791                5,304                2,338
  Other operating expense (income)...............            (191)                  (48)                (210)                 (65)
                                                        ---------               --------           ---------            ---------
                                                          160,330                63,449              448,869              203,999
                                                        ---------               -------            ---------            ---------
Operating income.................................          13,180                 4,076               42,951               19,912
Interest expense.................................          (2,124)               (2,892)              (7,809)              (8,552)
Interest income..................................              93                    --                  465                   13
Other income (expense)...........................             114                   (70)                (160)                  34
                                                        ---------               --------           ---------            ---------
Income (loss) before income taxes, minority
  interest, and extraordinary item...............          11,263                 1,114               35,447               11,407
Income tax expense...............................            (963)               (1,983)              (1,471)              (8,416)
Minority interest in loss (income) of combined
  companies and consolidated subsidiaries........               2                  (201)              (1,598)              (2,873)
                                                        ---------               -------            ---------            ---------
Net income (loss) before extraordinary item
  and preferred dividends........................          10,302                (1,070)              32,378                  118
Extraordinary loss on debt restructuring, net of        
  taxes............................................            --                    --                 (784)                  --
                                                        ---------               -------            ---------            ---------
Net income (loss) before preferred dividends.....          10,302                (1,070)              31,594                  118
Preferred dividends..............................              --                   (84)                 (41)                (248)
                                                        ---------               -------            ---------            ---------
Net income (loss) attributable to common shares..       $  10,302               $(1,154)           $  31,553            $    (130)
                                                        =========               =======            =========            ==========
Basic income (loss) per share:
  Income (loss) per share before extraordinary          
    item.........................................       $     .21               $  (.05)           $     .73            $    (.01)
  Extraordinary loss on debt restructuring, net
    of taxes.....................................              --                    --                 (.02)                  --
  Basic net income (loss) per share..............             .21                  (.05)                 .71                 (.01)

Diluted income (loss) per share:
  Income (loss) per share before extraordinary
    item.............................................   $     .21               $  (.04)           $     .72            $    (.01)
  Extraordinary loss on debt restructuring, net
    of taxes.........................................          --                    --                 (.02)                  --
  Diluted net income (loss) per share............             .21                  (.04)                 .70                 (.01)

Weighted average number of common shares
  outstanding (in thousands):
  Basic..........................................          48,221                24,665               44,274               24,407
  Diluted........................................          48,536                26,665               45,228               24,407

</Table>


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


                                       9

<PAGE>


                 OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

                    CONSOLIDATED AND COMBINED BALANCE SHEETS
                                 (IN THOUSANDS)


<Table>
<Caption>
                                                               CONSOLIDATED                   COMBINED
                                                               SEPTEMBER 30,                 DECEMBER 31,
                       ASSETS                                      2001                         2000
                                                               -------------                ------------ 
                                                                (UNAUDITED)
<S>                                                              <C>                         <C>      
Current assets:
  Cash and cash equivalents.........................             $   4,988                   $   4,821
  Accounts receivable, net..........................               104,917                      64,137
  Inventories, net..................................                99,126                      30,826
  Prepaid expenses and other current assets.........                 4,166                       1,715
                                                                 ---------                   ---------
    Total current assets............................               213,197                     101,499

Property, plant, and equipment, net.................               148,354                     143,468
Goodwill, net.......................................               173,632                     103,391
Other noncurrent assets.............................                 5,521                       5,160
                                                                 ---------                   ---------
     Total assets...................................             $ 540,704                   $ 353,518
                                                                 =========                   =========

            LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable and accrued liabilities..........             $  78,782                   $  57,248
  Income taxes......................................                 1,042                       2,796
  Current portion of long-term debt.................                 4,493                      37,629
  Other current liabilities.........................                 6,576                       3,433
                                                                 ---------                   ---------
     Total current liabilities......................                90,893                     101,106

  Long-term debt....................................                92,102                     102,614
  Deferred income taxes.............................                14,201                      19,977
  Postretirement healthcare benefits................                 5,676                       5,899
  Other liabilities.................................                 4,700                       4,519
                                                                 ---------                   ---------
     Total liabilities..............................               207,572                     234,115

Minority interest...................................                   154                      37,561
Redeemable preferred stock..........................                    --                      25,293
Stockholders' equity:
  Convertible preferred stock.......................                    --                       1,625
  Common stock......................................                   483                         272
  Additional paid-in capital........................               325,472                      83,810
  Retained earnings (deficit).......................                13,327                     (25,854)
  Accumulated other comprehensive loss..............                (6,304)                     (3,304)
                                                                 ---------                   ---------
     Total stockholders' equity.....................               332,978                      56,549
                                                                 ---------                   ---------
     Total liabilities and stockholders' equity.....             $ 540,704                   $ 353,518
                                                                 =========                   =========
</Table>


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


                                       10

<PAGE>


                 OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

          UNAUDITED CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)


<Table>
<Caption>
                                                                       NINE MONTHS ENDED SEPTEMBER 30,
                                                                         2001                    2000
                                                                     ---------               ---------
<S>                                                                   <C>                     <C>     
Cash flows from operating activities:
  Net income before extraordinary item........................        $ 32,378                $    118
  Adjustments to reconcile net income from continuing
    operations to net cash from operating activities:
    Minority interest, net of distributions...................           1,599                   2,860
    Depreciation and amortization.............................          20,476                  15,666
    Deferred income tax benefit ..............................          (6,820)                    (46)
    Other, net................................................           1,608                     613
    Changes in working capital................................         (20,016)                  8,768
                                                                      --------                --------
      Net cash flows provided by operating activities.........          29,225                  27,979

Cash flows from investing activities:
  Acquisitions of businesses, net of cash acquired............          (2,999)                 (3,500)
  Capital expenditures........................................         (21,538)                (11,325)
  Proceeds from sale of equipment.............................           5,410                   1,121
  Cash acquired in Sooner acquisition.........................           4,894                      --
  Payment of earn-out for acquired business...................          (2,120)                     --
  Other, net..................................................              17                     321
                                                                      --------                --------
      Net cash flows used in investing activities.............         (16,336)                (13,383)

Cash flows from financing activities:
  Revolving credit borrowings (repayments)....................          (1,638)                 (5,557)
  Debt repayments.............................................         (65,617)                (83,897)
  Debt borrowings.............................................              --                  88,030
  Preferred stock dividends...................................            (844)                   (502)
  Issuance of common stock....................................          84,599                      76
  Repurchase of preferred stock...............................         (21,775)                     --
  Payment of offering and financing costs.....................          (5,353)                     --
  Other, net..................................................          (2,200)                   (214)
                                                                      --------                --------
      Net cash flows used in financing activities.............         (12,828)                 (2,064)

Effect of exchange rate changes on cash.......................              22                     (37)
                                                                      --------                --------
Net increase in cash and cash equivalents from continuing
  operations..................................................              83                  12,495
Net cash provided by (used in) discontinued operations........             334                 (10,427)
Extraordinary item............................................            (250)                     --
Cash and cash equivalents, beginning of period................           4,821                   3,216
                                                                      --------                --------
Cash and cash equivalents, end of period......................        $  4,988                $  5,284
                                                                      ========                ========
</Table>


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


                                       11


<PAGE>


                 OIL STATES INTERNATIONAL, INC. AND SUBSIDIARIES

        NOTES TO UNAUDITED CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS

1. ORGANIZATION AND BASIS OF PRESENTATION

         The consolidated and combined financial statements include the
activities of Oil States International, Inc. (Oil States), HWC Energy Services,
Inc. (HWC) and PTI Group, Inc. (PTI), collectively the Controlled Group or the
Company. The reorganization accounting method, which yields results similar to
the pooling of interest method, has been used in the preparation of the
consolidated and combined financial statements of the Controlled Group (entities
under common control of SCF-III L.P., a private equity fund that focuses on
investments in the energy industry). Under this method of accounting, the
historical financial statements of HWC and PTI are combined with Oil States for
the three-month and nine-month periods ended September 30, 2000, and for the
period until February 14, 2001 when Oil States, HWC and PTI merged and Oil
States acquired Sooner Inc. (Sooner) in exchange for its common stock. After
February 14, 2001, the consolidated financial statements of Oil States include
the results of all its subsidiaries including HWC, PTI and Sooner. The combined
financial statements have been adjusted to reflect minority interests in the
Controlled Group. All significant intercompany accounts and transactions between
the consolidated entities have been eliminated in the accompanying consolidated
and combined financial statements.

         The accompanying unaudited consolidated and combined financials
statements of the Company and its wholly owned subsidiaries have been prepared
pursuant to the rules and regulations of the Securities and Exchange Commission.
Certain information in footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to these rules and regulations. The
unaudited financial statements included in this report reflect all the
adjustments, consisting of normal recurring adjustments, which the Company
considers necessary for a fair presentation of the results of operations for the
interim periods covered and for the financial condition of the Company at the
date of the interim balance sheet. Results for the interim periods are not
necessarily indicative of results for the year.

         The financial statements included in this report should be read in
conjunction with Oil States' audited combined financial statements and
accompanying notes included in its 2000 Form 10-K, filed under the Securities
Exchange Act of 1934, as amended.

2. INITIAL PUBLIC OFFERING, MERGER TRANSACTIONS AND REFINANCING

         On February 9, 2001, the Company began trading its common stock on the
New York Stock Exchange under the symbol "OIS" pursuant to completion of its
initial public offering (the Offering). On February 14, 2001, the Company closed
the business combination and the Offering thereby acquiring the minority
interests and the Sooner operations.

         Concurrent with the Offering, the Company acquired Sooner for $69.5
million. The Company exchanged 7,597,152 shares of its common stock for all of
the outstanding common shares of Sooner. The Company accounted for the
acquisition using the purchase method of accounting and recorded approximately
$40 million in goodwill that is being amortized over a 15-year period.

         Concurrent with the closing of the Offering, the Company issued
4,275,555 shares of common stock to SCF-III and SCF-IV L.P. (SCF-IV) in exchange
for approximately $36.0 million of indebtedness of Oil States and Sooner which
was held by SCF-III and SCF-IV (the SCF Exchange).

         With the proceeds received in the Offering, the Company repaid $43.7
million of outstanding subordinated debt of the Controlled Group and Sooner,
redeemed $21.8 million of preferred stock of Oil States, paid accrued interest
on subordinated debt and accrued dividends on preferred stock aggregating $7.1
million, and repurchased common stock from non-accredited shareholders and
shareholders holding pre-emptive stock purchase rights for $1.6 million. The
balance of the proceeds were used to reduce amounts outstanding under bank lines
of credit.

         On February 14, 2001, the Company entered into a $150 million senior
secured revolving credit facility. This new credit facility replaced existing
bank credit facilities.


                                      12


<PAGE>

3. DETAILS OF SELECTED BALANCE SHEET ACCOUNTS

         Additional information regarding selected balance sheet accounts is
presented below (in thousands):


<Table>
<Caption>
                                                SEPTEMBER 30,         DECEMBER 31,
                                                    2001                 2000
                                                    ----                 ----
<S>                                             <C>                    <C>     
              Accounts receivable, net:
                 Trade.......................   $ 104,744              $ 61,809
                 Unbilled revenue............       1,834                    --
                 Other.......................       1,449                 4,323
                 Allowance...................      (3,110)               (1,995)
                                                ---------              --------
                                                $ 104,917              $ 64,137
                                                =========              ========
</TABLE>




<TABLE>
<CAPTION>

                                               SEPTEMBER 30,          DECEMBER 31,
                                                   2001                  2000
                                                   ----                  ----
<S>                                             <C>                    <C>     
              Inventories, net:
                 Finished goods and             
                    purchased products.......   $  83,541              $ 14,813
                 Work in progress............      11,994                12,208
                 Raw materials...............       9,375                 8,720
                                                ---------              --------
                    Total inventories........     104,910                35,741
                 Inventory reserves..........      (5,784)               (4,915)
                                                ---------              --------
                                                $  99,126              $ 30,826
                                                =========              ========
</TABLE>



<TABLE>
<CAPTION>

                                                ESTIMATED     SEPTEMBER 30,        DECEMBER 31,
                                               USEFUL LIFE        2001                2000
                                               -----------        ----                ----
<S>                                            <C>              <C>                  <C>    
          Property, plant and equipment, net:
             Land..........................                   $   4,200             $  3,660
             Buildings and leasehold           
               improvements................    2-50 years        27,282               25,501
             Machinery and equipment.......    2-29 years       141,944              134,983
             Rental tools..................    3-5 years         23,529               18,370
             Office furniture and equipment    1-10 years        10,566                8,724
             Vehicles......................    2-5 years          5,840                4,853
             Construction in progress......                       1,007                   26
                                                              ---------             --------
               Total property, plant and                        
                 equipment.................                     214,368              196,117
          Less: Accumulated depreciation...                     (66,014)             (52,649)
                                                              ---------             --------
                                                              $ 148,354             $143,468
                                                              =========             ========
</TABLE>



<TABLE>
<CAPTION>


                                              SEPTEMBER 30,         DECEMBER 31,
                                                  2001                 2000
                                                  ----                 ----
<S>                                              <C>                   <C>     
         Accounts payable and accrued 
            liabilities:
            Trade accounts payable........       $46,331               $ 26,215
            Accrued compensation..........        10,039                  7,685
            Accrued insurance.............         3,201                  2,819
            Accrued interest..............           995                  6,646
            Other.........................        18,216                 13,883
                                                 -------               --------
                                                 $78,782               $ 57,248
                                                 =======               ========
</Table>


4. SEGMENT AND RELATED INFORMATION

    In accordance with SFAS No. 131, "Disclosures about Segments of an
Enterprise and Related Information," the Company has identified the following
reportable segments: Offshore Products and Wellsite Services and, since the
acquisition of Sooner, Tubular Services. The Company's reportable segments are
strategic business units that offer different products and services. They are
managed separately because each business requires different technology and
marketing strategies. Most of the businesses were acquired as a unit, and the
management at the time of the acquisition was retained.


                                       13

<PAGE>


    Financial information by industry segment for each of the three-month and
nine-month periods ended September 30, 2001 and 2000 is summarized in the
following tables (in thousands):


<Table>
<Caption>
                                            OFFSHORE      WELLSITE      TUBULAR      CORPORATE AND
                                            PRODUCTS      SERVICES      SERVICES      ELIMINATIONS        TOTAL
                                            --------      --------      --------      ------------        -----
<S>                                          <C>          <C>           <C>              <C>           <C>      
THREE MONTHS ENDED SEPTEMBER 30, 2001
    Revenues from unaffiliated
    customers........................        $ 31,371     $ 55,800      $  86,339        $    --       $ 173,510
                                             ========     ========      =========        =======       =========
    EBITDA...........................           3,659       15,429          2,827         (1,578)         20,337
                                             ========     ========      =========        =======       =========
    Depreciation and amortization....           1,583        4,094            535            945           7,157
                                             ========     ========      =========        =======       =========
    Operating income (loss)..........           2,076       11,335          2,292         (2,523)         13,180
                                             ========     ========      =========        =======       =========
    Capital expenditures.............           1,010        7,849            122             20           9,001
                                             ========     ========      =========        =======       =========
    Total assets.....................         137,919      222,199        119,680         60,906         540,704
                                             ========     ========      =========        =======       =========

THREE MONTHS ENDED SEPTEMBER 30, 2000
    Revenues from unaffiliated
    customers........................        $ 28,206     $ 39,319      $      --        $    --       $  67,525
                                             ========     ========      =========        =======       =========
    EBITDA...........................           1,085        8,190             --           (165)          9,110
                                             ========     ========      =========        =======       =========
    Depreciation and amortization....           1,624        3,411             --             (1)          5,034
                                             ========     ========      =========        ========      =========
    Operating income (loss)..........            (539)       4,779             --           (164)          4,076
                                             ========     ========      =========        =======       =========
    Capital expenditures.............             564        2,004             --             --           2,568
                                             ========     ========      =========        =======       =========
    Total assets.....................         130,432      202,049             --         14,673         347,154
                                             ========     ========      =========        =======       =========
</TABLE>



<TABLE>
<CAPTION>
                                            OFFSHORE      WELLSITE      TUBULAR      CORPORATE AND
                                            PRODUCTS      SERVICES      SERVICES      ELIMINATIONS        TOTAL
                                            --------      --------      --------      ------------        -----
<S>                                          <C>          <C>           <C>              <C>           <C>      
 NINE MONTHS ENDED SEPTEMBER 30, 2001
    Revenues from unaffiliated
    customers.....................           $ 93,301     $181,448      $ 217,071        $    --       $ 491,820
                                             ========     ========      =========        =======       =========
    EBITDA........................              9,406       49,442          8,687         (4,108)         63,427
                                             ========     ========      =========        =======       =========
    Depreciation and amortization.              4,727       12,150          1,235          2,364          20,476
                                             ========     ========      =========        =======       =========
    Operating income (loss).......              4,679       37,292          7,451         (6,471)         42,951
                                             ========     ========      =========        =======       =========
    Capital expenditures..........              2,457       18,526            456             99          21,538
                                             ========     ========      =========        =======       =========
    Total assets..................            137,919      222,199        119,680         60,906         540,704
                                             ========     ========      =========        =======       =========

 NINE MONTHS ENDED SEPTEMBER 30, 2000
    Revenues from unaffiliated
    customers.....................           $ 84,117     $139,794      $      --        $    --       $ 223,911
                                             ========     ========      =========        =======       =========
    EBITDA........................              1,501       34,302             --           (225)         35,578
                                             ========     ========      =========        =======       =========
    Depreciation and amortization.              4,925       10,742             --             (1)         15,666
                                             ========     ========      =========        ========      =========
    Operating income (loss).......             (3,424)      23,560             --           (224)         19,912
                                             ========     ========      =========        =======       =========
    Capital expenditures..........              1,771        9,554             --             --          11,325
                                             ========     ========      =========        =======       =========
    Total assets..................            130,432      202,049             --         14,673         347,154
                                             ========     ========      =========        =======       =========
</Table>


5. EXTRAORDINARY ITEM

    In connection with the debt refinancing in February 2001 (Note 2), the
Company incurred prepayment penalties and wrote-off unamortized debt issue costs
totaling $0.8 million.

6. COMPREHENSIVE INCOME (LOSS)

    Comprehensive income (loss) for the three-month and nine month periods ended
September 30, 2001 and 2000 was as follows (in thousands):


<Table>
<Caption>
                                             THREE MONTHS ENDED SEPTEMBER 30,           NINE MONTHS ENDED SEPTEMBER 30,
                                             --------------------------------           -------------------------------
                                                 2001                   2000                 2001                2000
                                              ---------              ---------            --------            -------
<S>                                            <C>                    <C>                  <C>                 <C>    
       Comprehensive income:
          Net income (loss).............       $10,302                $(1,070)             $31,594             $   118
          Cumulative translation               
            adjustment..................        (1,468)                   830               (3,000)             (2,701) 
                                               -------                -------              -------             ------- 
          Total comprehensive income           
            (loss)......................       $ 8,834                $  (240)             $28,594             $(2,583)
                                               =======                =======              =======             =======
</Table>


7. COMMITMENTS AND CONTINGENCIES

    LTV Corporation (LTV), the former owner of Oil States, under the terms of
the stock purchase agreement, has indemnified Oil States of all claims and
contingencies, threatened or pending, relating to business activities prior to
August 1, 1995. Specifically, claims involving environmental remediation,
product warranty, legal actions, workers' compensation issues and various
federal, state and sales tax matters related to pre-August 1995 business
transactions are the financial responsibility of LTV. The financial
responsibilities are initially satisfied through the reserves assumed as part of
the acquisition.


                                       14


<PAGE>

    Oil States has warranted items related to the sale of two of its
subsidiaries, subject to threshold amounts defined in the respective sale
agreements. The Company believes all amounts have been properly reflected in the
accompanying consolidated financial statements.

    The Company is involved in various claims, lawsuits and other proceedings
relating to a wide variety of matters. While uncertainties are inherent in the
final outcome of such matters, and it is presently impossible to determine the
actual costs that ultimately may be incurred, management believes that the
resolution of such uncertainties and the incurrence of such costs will not have
a material adverse effect on the Company's consolidated financial position,
results of operations or liquidity.


                                       15

<PAGE>

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

         This discussion contains forward-looking statements based on our
current expectations, assumptions, estimates and projections about us and our
industry. These forward-looking statements involve risks and uncertainties. Our
actual results could differ materially from those indicated in these
forward-looking statements as a result of certain factors as described below in
the Overview section and as more fully described under Cautionary Statement for
Purposes of the "Safe Harbor" Provisions of the Private Securities Litigation
Reform Act of 1995 in the Business section of the Company's Annual Report on
Form 10-K. We undertake no obligation to update publicly any forward-looking
statements, even if new information becomes available or other events occur in
the future.

Overview

         We provide a broad range of products and services to the oil and gas
industry through our offshore products, tubular services and well site services
business segments. Demand for our products and services is cyclical and
substantially dependent upon activity levels in the oil and gas industry,
particularly our customers' willingness to spend capital on the exploration and
development of oil and gas reserves. Demand for our products and services by our
customers is highly sensitive to current and expected oil and natural gas
prices. Our offshore products segment is a leading provider of highly engineered
and technically designed products for offshore oil and gas development and
production systems and facilities. Sales of our offshore products and services
depend upon repairs and upgrades of existing drilling rigs, construction of new
drilling rigs and the development of offshore production systems. In this
segment, we are particularly influenced by deepwater drilling and production
activities. Through our tubular services division, we distribute premium tubing
and casing. Sales of tubular products and services depend upon the overall level
of drilling activity and the mix of wells being drilled. Demand for tubular
products is positively impacted by increased drilling of deeper horizontal and
offshore wells that generally require premium tubulars and connectors, large
diameter pipe and longer and additional tubular and casing strings. In our well
site services business segment, we provide hydraulic well control services,
pressure control equipment and rental tools and remote site accommodations,
catering and logistics services. Demand for our well site services depends upon
the level of worldwide drilling and workover activity.

         Beginning in late 1996 and continuing though the early part of 1998,
stabilization of oil and gas prices led to increases in drilling activity as
well as the refurbishment and new construction of drilling rigs. In the second
half of 1998, crude oil prices declined substantially and reached levels below
$11 per barrel in early 1999. With this decline in pricing, many of our
customers substantially reduced their capital spending and related activities.
This industry downturn continued through most of 1999. The rig count in the
United States and Canada, as measured by Baker Hughes Incorporated, fell from
1,481 rigs in February 1998 to 559 rigs in April 1999. This downturn in activity
had a material adverse effect on demand for our products and services, and our
operations suffered as a result.

         The price of crude oil has increased over 1999 levels due to improved
demand for oil and supply reductions by OPEC member countries. This improvement
in crude oil pricing has led to increases in the rig count in 2000 and the first
half of 2001, particularly in Canada and the United States where the rig count
reached a high of 1,717 rigs in February 2001. The rig count began to decline in
the third quarter of this year. As of November 2, 2001, the rig count in the
United States and Canada, as measured by Baker Hughes, was 1,339, a decline of
22% from the high reached earlier this year. Demand for our tubular services
began to weaken with the overall deterioration of industry fundamentals. Our
offshore products segment has shown signs of recovery based on the growth of our
backlog in this segment and the level of customer inquiries currently being
received. We believe that our offshore products segment has lagged the general
market recovery in 2000 and 2001 because its sales related to offshore
construction and production facility development generally occur later in the
exploration and development cycle. Worldwide construction activity is improving
currently and we expect it to increase substantially when construction activity
in the shallow water regions of the Gulf of Mexico resumes and as the industry
increasingly pursues deeper water drilling and development projects.

         Consolidation among both major and independent oil and gas companies
has affected exploration, development and production activities, particularly in
international areas. These companies have focused on integration activities and
cost control measures over recent periods. As a result, we believe that capital
spending in international areas has lagged the industry recovery in 2000 and
2001. As a result, international spending is expected to increase in 2002.

         Recently, there has been a significant decline in oil and natural gas
prices due to higher oil and gas inventories and a general economic slowdown in
the United States and in other economies. The economic slowdown coupled with
conservation efforts have affected energy supplies and related pricing. The rig
count has decreased and has now fallen below prior year levels. Management
believes this price uncertainty will impact near-term activity levels and could
have an adverse effect on the Company's profitability. 



                                       16

<PAGE>

As a result, the Company has taken steps to reduce its tubular inventories. The
Company's profitability could suffer if pricing is reduced below inventory
carrying amounts. We believe longer-term oil and gas supply and demand
fundamentals remain positive.

The Combination

         Prior to our initial public offering in February 2001, SCF-III owned
majority interests in Oil States, HWC and PTI, and SCF-IV owned a majority
interest in Sooner. The following chart depicts the summary ownership structure
of Oil States, HWC, PTI and Sooner prior to the Combination:

         [See Chart in 2000 Form 10-K depicting that SCF-III, L.P. owns 84.6%,
80.6% and 57.7% of Oil States, HWC and PTI, respectively, and minority
shareholders own 15.4%, 19.4% and 42.3% of Oil States, HWC and PTI,
respectively, in each case prior to the Combination. The chart also depicts that
SCF-IV, L.P. owns 81.7% of Sooner and minority stockholders own 18.3% of Sooner,
prior to the Combination.]

         L.E. Simmons & Associates, Incorporated is the ultimate general partner
of SCF-III and SCF-IV. L.E. Simmons, the chairman of our board of directors, is
the sole shareholder of L.E. Simmons & Associates, Incorporated. Concurrently
with the closing of the Offering, Oil States combined with Sooner, HWC and PTI,
a transaction which we refer to as the Combination. As a result HWC, Sooner and
PTI became our wholly owned subsidiaries. Concurrently with the closing the
Offering we also issued 4,275,555 shares of common stock to SCF-III and SCF-IV
in exchange for approximately $36.0 million of indebtedness of Oil States and
Sooner which was held by SCF (the SCF Exchange). This exchange was based on the
initial public offering price of $9.00 per share less underwriting discounts and
commissions. The following chart depicts the summary ownership structure of our
company following the Combination, the SCF Exchange and the Offering:

         [See Chart in 2000 Form 10-K depicting that purchasers in the offering
own 20.7% of our company, existing stockholders (other than SCF) own 16.1%,
SCF-III, L.P. owns 45.2% and SCF-IV, L.P. owns 17.9%, in each case following the
Combination and the Offering. The chart also depicts that Oil States owns 100%
of HWC, 100% (indirectly) of PTI and 100% of Sooner following the Combination
and the Offering.]

         The financial results of Oil States, HWC and PTI have been combined for
the nine months ended September 30, 2000 and for the period from January 1, 2001
to February 14, 2001 using reorganization accounting, which yields results
similar to the pooling of interests method. The combined results of Oil States,
HWC and PTI form the basis for the discussion of our historical results of
operations provided below. The operations of Oil States, HWC and PTI represent
two of our business segments, offshore products and well site services.
Concurrent with the closing of the Offering, Oil States acquired Sooner, and the
acquisition was accounted for using the purchase method of accounting. The pro
forma financial statements for the three-month and nine month periods ended
September 30, 2001 and 2000 reflect the acquisition of Sooner as if such
acquisition occurred on January 1, 2000. After the acquisition of Sooner, we
report under three business segments. The unaudited pro forma financial
statements do not reflect any cost savings or other financial synergies that may
be realized after the Combination.

         PRO FORMA RESULTS OF OPERATIONS

         Since the acquisition of Sooner, we have reported under three business
segments, offshore products, well site services and tubular services. Pro forma
information including these three segments is presented below.

<Table>
<Caption>
                                                             PRO FORMA                        PRO FORMA
                                                           THREE MONTHS                      NINE MONTHS
                                                        ENDED SEPTEMBER 30,              ENDED SEPTEMBER 30,
                                                    ---------------------------     ---------------------------
                                                        2001           2000             2001           2000
                                                    ------------   ------------     -----------     -----------
<S>                                                 <C>            <C>              <C>             <C>
                     Revenues
                       Offshore Products.......        $  31.4        $   28.2         $  93.3         $  84.1
                       Well Site Services......           55.8            39.3           181.4           139.8
                       Tubular Services........           86.3            58.9           265.6           213.5
                                                       -------        --------         -------         -------
                          Total................        $ 173.5        $  126.4         $ 540.3         $ 437.4
                                                       =======        ========         =======         =======
                     Operating Income (Loss)
                       Offshore Products.......        $   2.1        $   (0.5)        $   4.7         $  (3.4)
                       Well Site Services......           11.3             4.8            37.3            23.6
                       Tubular Services........            2.3             3.4             9.5            13.5
                       Corporate and Eliminations         (2.5)           (1.2)           (7.0)           (3.8)
                                                       -------        --------         -------         -------
                          Total................        $  13.2        $    6.5         $  44.5         $  29.9
                                                       =======        ========         =======         =======
</Table>





                                       17

<PAGE>

NINE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO THE NINE MONTHS ENDED 
SEPTEMBER 30, 2000

         Revenues. Pro forma revenues increased by 23.5% from $437.4 million
during the nine months ended September 30, 2000 to $540.3 million for the nine
months ended September 30, 2001. Revenues from our well site services segment
increased $41.6 million, or 29.8%, of which $19.7 million was generated from our
remote site accommodations, catering and logistics services and modular building
construction services, $6.8 million was generated from our rental tool business,
$9.4 million was generated from our land drilling operations and $5.7 million
was generated from our hydraulic workover business. Increases in Canadian
drilling activity, oil sands development activity and strong Gulf of Mexico
accommodations activity drove the increase in revenues in our remote site
accommodations, catering and logistics services and modular building
construction services. The increases in revenues from our rental tool operations
and land drilling services were due to improvements in utilization and pricing
from the first nine months of 2000 to the first nine months of 2001. Our tubular
services revenues increased $52.1 million, or 24.4%, over the period as a direct
result of the increased drilling activity over the period. The remaining $9.2
million increase in revenues was generated by our offshore products segment.
This year over year increase in revenues was generated by increased demand for
our bearings and connector products and certain fabrication work.

         Cost of sales. Cost of sales increased $83.2 million, or 23.6%, to
$435.3 million for the nine months ended September 30, 2001 from $352.1 million
for the nine months ended September 30, 2000. The cost of sales increase was due
to increased revenues at each of our operating segments. Cost of sales increased
in our well site services, tubular services and offshore products segments by
$23.9 million, $55.6 million and $2.9 million, respectively. Our gross profit
margin for the period decreased slightly from 19.5% in 2000 to 19.4% in 2001.
Gross margin improvements in our well site services and offshore products
segments were offset by margin declines in our tubular services segments.

         Selling, General and Administrative Expenses. During the nine months
ended September 30, 2001, selling, general and administrative expenses increased
$3.9 million, or 11.0%, to $39.5 million from $35.6 million for the nine months
ended September 30, 2000. Selling, general and administrative expenses increased
by $2.9 million, or 19.7%, in our well site services segment due to headcount
increases in support of increased market activity. This increase was partially
offset by a $1.7 million decrease in our offshore products segment as we reduced
costs in the second half of 2000 to improve profitability. Corporate headquarter
charges were up $2.5 million due to the establishment of a new corporate
headquarters office in connection with the Offering.

         Depreciation and Amortization. Depreciation and amortization increased
$1.3 million to a total of $21.1 million for the nine months ended September 30,
2001. The 6.4% increase was primarily due to acquisitions and capital
expenditures in our well site services segment during 2000.

         Operating Income. Our operating income represents revenues less (i)
cost of sales, (ii) selling, general and administrative expenses and (iii)
depreciation and amortization plus other operating income. Our operating income
increased $14.6 million, or 48.8%, to $44.5 million for the nine months ended
September 30, 2001 from $29.9 million for the nine months ended September 30,
2000. Operating income from our well site services segment increased $13.7
million from $23.6 million for the nine months ended September 30, 2000 to $37.3
million during the nine months ended September 30, 2001. Operating income for
our tubular services segment decreased $4.0 million to $9.5 million for the nine
months ended September 30, 2001 from $13.5 million during the nine months ended
September 30, 2000. Operating income in our offshore products segment increased
$8.1 million to $4.7 million for the nine months ended September 30, 2001 from
an operating loss of $3.4 million for the nine months ended September 30, 2000.

         Net Interest Expense. Net interest expense totaled $7.1 million for the
nine months ended September 30, 2001 compared to $6.7 million for the nine
months ended September 30, 2000. The $0.4 million increase in net interest
expense was primarily related to an increase in average debt balances
outstanding, partially offset by lower interest rates.

         Income Tax Expense. Income tax expense totaled $1.6 million during the
nine months ended September 30, 2001 compared to $3.3 million during the same
period in 2000. The decrease of $1.7 million, and the corresponding low
effective tax rate, was primarily due to a reduction in the allowance applied
against tax assets, primarily net operating losses (NOL's), due to expected tax
benefits resulting from the Combination. We adjusted such tax assets because we
determined that it was more likely than not that the deferred tax assets would
be realized in the period.

         Minority Interest. Minority interest expense was immaterial during the
nine months ended September 30, 2001 and 2000. Substantially all of the minority
interests were acquired, and therefore reduced, in connection with the
Combination.




                                       18

<PAGE>

         COMBINED AND CONSOLIDATED RESULTS OF OPERATIONS.

         Prior to the Sooner acquisition, which was effective February 14, 2001,
we reported under two business segments, offshore products and well site
services. With the Sooner acquisition, we added the tubular services segment.
Information for these segments, which represent the combined results of Oil
States, HWC and PTI using reorganization accounting through the Sooner
acquisition date and consolidated results of Oil States, HWC, PTI and Sooner
after February 14, 2001 is presented below.


<Table>
<Caption>
                                                            THREE MONTHS                 NINE MONTHS
                                                         ENDED SEPTEMBER 30,         ENDED SEPTEMBER 30,
                                                     --------------------------  --------------------------
                                                         2001          2000          2001          2000
                                                     ------------  ------------  ------------  ------------
<S>                                                  <C>           <C>           <C>           <C>
                       Revenues
                         Offshore Products.......       $  31.4        $ 28.2       $  93.3       $  84.1
                         Well Site Services......          55.8          39.3         181.4         139.8
                         Tubular Services........          86.3           --          217.1            --
                                                        -------        -----        -------       -------
                            Total................       $ 173.5        $ 67.5       $ 491.8       $ 223.9
                                                        =======        ======       =======       =======
                       Operating Income (Loss)
                         Offshore Products.......       $   2.1        $ (0.5)      $   4.7       $  (3.4)
                         Well Site Services......          11.3           4.8          37.3          23.6
                         Tubular Services........           2.3           --            7.5            --
                         Corporate and Eliminations        (2.5)         (0.2)         (6.5)         (0.3)
                                                        -------        ------       -------       -------
                            Total................       $  13.2        $  4.1       $  43.0       $  19.9
                                                        =======        ======       =======       =======
</Table>


THREE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO THE THREE MONTHS ENDED 
SEPTEMBER 30, 2000

         Revenues. Revenues increased $106.0 million, or 157.0%, during the
three months ended September 30, 2001 compared to the three months ended
September 30, 2000. This revenue increase was primarily attributable to the
acquisition of Sooner in February 2001 which contributed $86.3 million revenues.
Well site services revenues increased $16.5 million, or 42.0%, and offshore
products revenues increased $3.2 million, or 11.3%, during the same period. Of
the $16.5 million increase in well site services, $8.8 million was generated by
our remote site accommodations, catering and logistics services and modular
building construction services, $3.0 million was from our drilling operations,
$2.7 million was generated from our hydraulic workover units and $2.0 million
was generated from our rental tool operations. The improvement in revenues from
our remote site accommodations, catering and logistics services and modular
building construction services was primarily due to an increase in headcount
served in support of increased construction activity in the oil sands
developments in Northern Alberta, Canada. The increase in drilling revenues was
attributable to increased utilization and footage rates charged in both Texas
and Ohio. The hydraulic workover units' increased revenues in the three months
ended September 30, 2001 compared to the same period in the prior year was
attributable to higher utilization (847 revenue days vs. 731 revenue days) and
higher revenues per day worked. Increased activity for our hydraulic workover
units was noted in all geographic areas, but it was most significant in
Venezuela and the Middle East regions. Our rental tool operations benefited from
increased activity and additional tools purchased for rent since the third
quarter of 2000. Offshore products revenues increased in the quarter ended
September 30, 2001 compared to the same period in the prior year because of
increased volumes in its bearing and connector products and higher activity in
fabrication and repair operations.

         Cost of Sales. Cost of sales increased $91.8 million, or 188.9%, to
$140.4 million in the three months ended September 30, 2001 compared to $48.6
million in the three months ended September 30, 2000. The acquisition of
Sooner's tubular services business accounted for $81.5 million of this increase.
Our gross margins decreased to 19.1% in the three months ended September 30,
2001 from 28.0% during the same period in 2000 primarily due to the addition of
our tubular services segment beginning February 2001, whose business is
characterized by lower gross margins than are realized in our offshore services
and well site services business.

         Selling, General and Administrative Expenses. During the three months
ended September 30, 2001, selling general and administrative expenses increased
$3.2 million to $13.0 million compared to $9.8 million for the three months
ended September 30, 2000. The newly acquired tubular services division added
$2.0 million of the increase. Selling, general and administrative expenses in
our well site services segment increased $0.8 million, or 14.6%, due to
headcount increases in support of increased market activity. This increase was
partially offset by a $0.5 million decrease in our offshore products segment,
where costs were reduced in response to the market downturn in offshore
construction activity during 2000 and early 2001. Additionally, there was an
increase in selling, general and administrative expenses of $0.9 million
attributable to the establishment of our corporate headquarters office.

         Depreciation and Amortization. Depreciation and amortization totaled
$7.2 million for the three months ended September 30, 2001 compared to $5.0
million for the three months ended September 30, 2000. The addition of our
tubular services segment accounted for $0.5 million of the increase. The
remaining increase was due to asset acquisitions and capital expenditures made
in our well site 



                                       19

<PAGE>

services segment during 2000, as well as amortization of goodwill recorded in
connection with our acquisitions of Sooner and minority interests in February
2001.

         Operating Income. Operating income increased by $9.1 million to $13.2
million for the three months ended September 30, 2001 from $4.1 million for the
same period in 2000. Operating income from our well site services segment
increased $6.5 million from $4.8 million for the three months ended September
30, 2000 to $11.3 million for the same period in 2001. Operating income in our
offshore products segment increased $2.6 million from a loss of $0.5 million in
2000 to income of $2.1 million in 2001. The tubular services segment contributed
operating income of $2.3 million during the three months ended September 30,
2001.

         Income Tax (Expense) Benefit. Income tax expense totaled $1.0 million
during the three months ended September 30, 2001 compared to $2.0 million during
the three months ended September 30, 2000. The decrease of $1.0 million, and the
correspondingly low effective tax rate, was primarily due to a reduction in the
allowance applied against tax assets, primarily net operating losses (NOL's),
due to expected tax benefits resulting from the Combination.

         Minority Interest. Minority interests decreased in 2001 to zero from
$0.2 million during the three months ended September 30, 2000. Substantially all
of the minority interests were acquired, and therefore reduced, in connection
with the Offering.

NINE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO THE NINE MONTHS ENDED 
SEPTEMBER 30, 2000

         Revenues. Revenues increased $267.9 million, or 119.7%, during the nine
months ended September 30, 2001 compared to the nine months ended September 30,
2000. This revenue increase was primarily due to the acquisition of Sooner in
February 2001, which contributed $217.1 million in revenues. Revenues from our
well site services segment increased $41.6 million, or 29.8%, of which $19.7
million was generated from our remote site accommodations, catering and
logistics services and modular building construction services, $6.8 million was
generated from our rental tool business, $9.4 million was generated from our
land drilling operations and $5.7 million was generated from our hydraulic
workover business. Increases in Canadian drilling activity, oil sands
development activity and strong Gulf of Mexico accommodations activity drove the
increase in revenues in our remote site accommodations, catering and logistics
services and modular building construction services. The increases in revenues
from our rental tool operations and land drilling services were due to
improvements in utilization and pricing from the first nine months of 2000 to
the first nine months of 2001. The remaining $9.2 million increase in revenues
was generated by our offshore products segment. This year over year increase in
revenues was generated by increased demand for our bearings and connector
products and certain fabrication work.

         Cost of sales. Cost of sales increased $230.9 million, or 144.9%, to
$390.2 million for the nine months ended September 30, 2001 from $159.3 million
for the nine months ended September 30, 2000. The acquisition of Sooner
accounted for $203.3 million of this increase. The remaining increase in cost of
sales was primarily due to the increased revenues at each of our operating
segments. Cost of sales increased in our well site services and offshore
products segments by $23.9 million and $2.9 million, respectively. Our gross
profit margin decreased to 20.7% in the nine months ended September 30, 2001
from 28.9% during the same period in 2000 primarily due to the addition of our
tubular services segment, whose business is characterized by lower margins than
are realized in our other two operating segments.

         Selling, General and Administrative Expenses. During the nine months
ended September 30, 2001, selling, general and administrative expenses increased
$9.3 million to $38.4 million from $29.1 million during the nine months ended
September 30, 2000. The acquisition of our tubular services segment contributed
$5.1 million of this increase. Selling, general and administrative expenses
increased by $2.9 million, or 19.7%, in our well site services segment due to
headcount increases in support of increased market activity. This increase was
partially offset by a $1.7 million decrease in our offshore products segment as
we reduced costs in the second half of 2000 to improve profitability. Corporate
headquarter charges were up $3.0 million due to the establishment of a new
corporate headquarters office in connection with the Offering.

         Depreciation and Amortization. Depreciation and amortization increased
$4.8 million to a total of $20.5 million for the nine months ended September 30,
2001. The addition of our tubular services segment caused $1.2 million of this
increase. The remaining increase was due to asset acquisitions and capital
expenditures made in our well site services segment during 2000, as well as
amortization of goodwill recorded in connection with our acquisitions of Sooner
and minority interests in February 2001.

         Operating Income. Operating income increased $23.1 million, or 116.1%,
to $43.0 million during the nine months ended September 30, 2001 from $19.9
million during the nine months ended September 30, 2000. Operating income from
our well site services segment increased $13.7 million from $23.6 million for
the nine months ended September 30, 2000 to $37.3 million for the nine months
ended September 30, 2001. Our tubular services segment contributed operating
income of $7.5 million during the period 



                                       20

<PAGE>

from acquisition in February 2001 to September 30, 2001. Operating income in our
offshore products segment increased $8.1 million to $4.7 million for the nine
months ended September 30, 2001 from a operating loss of $3.4 million for the
nine months ended September 30, 2000.

         Income Tax Expense. Income tax expense totaled $1.5 million during the
nine months ended September 30, 2001 compared to $8.4 million during the same
period in 2000. The decrease of $6.9 million, and the corresponding low
effective tax rate, was primarily due to a reduction in the allowance applied
against tax assets, primarily net operating losses (NOL's), due to expected tax
benefits resulting from the Combination. We adjusted such tax assets because we
determined that it was more likely than not that the deferred tax assets would
be realized in the period.

         Minority Interest. Minority interests decreased by $1.3 million during
the nine months ended September 30, 2001 to $1.6 million from $2.9 million
during the nine months ended September 30, 2000. Substantially all of the
minority interests were acquired, and therefore reduced, in connection with the
Combination.

         LIQUIDITY AND CAPITAL RESOURCES

         Our primary liquidity needs are to fund capital expenditures, such as
expanding and upgrading our manufacturing facilities and equipment, increasing
our rental tool and workover assets, increasing our accommodation units, funding
new product development, and to repay current maturities of long-term debt and
to fund general working capital needs. In addition, capital is needed to fund
strategic business acquisitions. Our primary sources of funds have been cash
flow from operations, proceeds from borrowings under our bank facilities and
private and public capital investments.

         Cash was provided by operations during the nine months ended September
30, 2001 and 2000 in the amounts of $29.2 million and $28.0 million,
respectively. Cash was provided by operations in 2000 as a result of decreased
seasonal working capital needs, primarily in Canada. Cash provided by operations
in 2001 reflects net income before extraordinary item, partially offset by the
use of working capital to reduce accounts payable and accrued expenses during
the nine months ended September 30, 2001.

         Capital expenditures totaled $21.5 million and $11.3 million during the
nine months ended September 30, 2001 and 2000, respectively. Capital
expenditures during both these periods consisted principally of purchases of
assets for our well site services businesses. We expect to spend a total of
approximately $27 million during 2001 to upgrade our equipment and facilities
and expand our product and service offerings. The balance of these capital
expenditures are expected to be funded with operating cash flow and with
borrowings available under our $150 million credit facility.

         Cash was used by investing activities in the amount of $16.3 million
during the nine months ended September 30, 2001 primarily as a result of capital
expenditures which totaled $21.5 million and two rental tool acquisitions in our
well site services segment totaling $3.0 million, partially offset by cash
acquired in connection with the Sooner acquisition and proceeds from asset
sales. Net cash was used in investing activities in the amount of $13.4 million
during the nine months ended September 30, 2000, primarily to fund capital
expenditures and acquisitions.

         Net cash of $12.8 million and $2.1 million was used in financing
activities during the nine months ended September 30, 2001 and September 30,
2000, respectively. Net cash was used in financing activities in 2001 primarily
as a result of debt and preferred stock repayments offset by net proceeds of the
Offering. Net cash used in financing activities during the nine months ended
September 30, 2000 was primarily for debt repayments.

         With the proceeds received in the Offering, the Company repaid $43.7
million of outstanding subordinated debt of the Controlled Group and Sooner,
redeemed $21.8 million of preferred stock of Oil States, paid accrued interest
on subordinated debt and accrued dividends on preferred stock aggregating $7.1
million, and repurchased common stock from non-accredited shareholders and
shareholders holding pre-emptive stock purchase rights for $1.6 million. The
balance of the proceeds were used to reduce amounts outstanding under bank lines
of credit. Concurrently with the closing of our initial public offering, we
issued 4,275,555 shares of common stock in the SCF Exchange.

         Also concurrent with the Offering, we entered into a $150 million
senior secured revolving credit facility in February 2001. Credit Suisse First
Boston, New York branch, an affiliate of Credit Suisse First Boston Corporation,
is the administrative agent, collateral agent, book manager and lead arranger.
Credit Suisse First Boston Canada, an affiliate of Credit Suisse First Boston
Corporation, is the Canadian administrative agent, collateral agent, book
manager and lead arranger. Up to $45.0 million of the new credit facility is
available in the form of loans denominated in Canadian dollars and may be made
to our principal Canadian operating subsidiaries. 



                                       21

<PAGE>
This credit facility replaced our existing credit facilities. The facility
matures on February 14, 2004, unless extended for up to two additional one-year
periods with the consent of the lenders. Amounts borrowed under this new
facility bear interest, at our election, at either:

         o    a variable rate equal to LIBOR (or, in the case of Canadian dollar
              denominated loans, the Bankers' Acceptance discount rate) plus a
              margin ranging from 1.5% to 2.5%; or

         o    an alternate base rate equal to the higher of Credit Suisse First
              Boston's prime rate and the federal funds effective rate plus 0.5%
              (or, in the case of Canadian dollar denominated loans, the
              Canadian Prime Rate) plus a margin ranging from 0.5% to 1.5%,
              depending upon the ratio of total debt to EBITDA (as defined in
              the new credit facility).

         We pay commitment fees ranging from 0.25% to 0.5% per year on the
undrawn portion of the facility, also depending upon the ratio of total debt to
EBITDA.

         Subject to exceptions, commitments under our credit facility will be
permanently reduced, and loans prepaid, by an amount equal to 100% of the net
cash proceeds of all non-ordinary course asset sales and the issuance of
additional debt and by 50% of the issuance of equity securities. Mandatory
commitment reductions will be allocated pro rata based on amounts outstanding
under the U.S. dollar denominated facility and the Canadian dollar denominated
facility. In addition, voluntary reductions in commitments will be permitted.

         Our credit facility is guaranteed by all of our active domestic
subsidiaries and, in some cases, our Canadian and other foreign subsidiaries.
Our credit facility is secured by a first priority lien on all our inventory,
accounts receivable and other material tangible and intangible assets, as well
as those of our active subsidiaries. However, no more than 65% of the voting
stock of any foreign subsidiary is required to be pledged if the pledge of any
greater percentage would result in adverse tax consequences.

         Our credit facility contains negative covenants that restrict our
ability to:

         o    incur additional indebtedness;

         o    prepay, redeem and repurchase outstanding indebtedness, other than
              loans under the new credit facility;

         o    pay dividends;

         o    repurchase and redeem capital stock;

         o    sell assets other than in the ordinary course of business;

         o    make liens;

         o    engage in sale-leaseback transactions;

         o    make specified loans and investments;

         o    make acquisitions;

         o    enter into mergers, consolidations and similar transactions;

         o    enter into hedging arrangements;

         o    enter into transactions with affiliates;

         o    change the businesses we and our subsidiaries conduct; and

         o    amend debt and other material agreements.




                                       22

<PAGE>

         In addition, our credit facility requires us to maintain:

         o    a ratio of EBITDA to interest expense of not less than 3.0 to 1.0;

         o    a level of consolidated net tangible assets of not less than $120
              million plus 50% of each quarter's consolidated net income (but
              not loss);

         o    a maximum ratio of total debt to EBITDA of not greater than 3.5 to
              1.0; and

         o    a maximum ratio of total senior debt to EBITDA of not greater than
              3.0 to 1.0.

         Under our credit facility, the occurrence of specified change of
control events involving our company would constitute an event of default that
would permit Credit Suisse First Boston to, among other things, accelerate the
maturity of the facility and cause it to become immediately due and payable in
full.

         As of September 30, 2001, we had $82.8 million outstanding under this
facility and an additional $6.3 million of outstanding letters of credit leaving
$60.9 million available to be drawn under the facility.

         We had an aggregate of approximately $9 million of subordinated debt
outstanding at September 30, 2001. This subordinated debt will become due and
payable at various times over the period from October 2001 to November 2005.

         We believe that cash from operations and available borrowings under our
credit facility will be sufficient to meet our liquidity needs for the
foreseeable future. If our plans or assumptions change or are inaccurate, or we
make any acquisitions, we may need to raise additional capital. We may not be
able to raise additional funds or may not be able to raise such funds on
favorable terms.

         Tax Matters

         For the year ended December 31, 2000, we had deferred tax assets, net
of deferred tax liabilities, of approximately $35 million for federal income tax
purposes before application of valuation allowances. Our primary deferred tax
assets are net operating loss carry forwards, or NOLs, which total approximately
$136.1 million. A valuation allowance is currently provided against the majority
of our NOLs. The NOLs expire over a period through 2020. Our NOLs are currently
limited under Section 382 of the Internal Revenue Code due to a change of
control that occurred during 1995. However, approximately $85 million of NOLs
are available for use currently if sufficient income is generated.

         Our 2001 effective tax rate approximates 4%. This low effective tax
rate is due to the partial utilization of net operating losses which benefit the
consolidated group after the merger. We currently estimate our 2002 effective
tax rate at approximately 22%.

         Recent Accounting Pronouncements

         In 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 establishes accounting and
reporting standards requiring that every derivative instrument (including
derivative instruments embedded in other contracts) be recorded on the balance
sheet as either an asset or liability measured at its fair value. The statement
requires that changes in the derivative's fair value be recognized currently in
earnings unless specific hedge accounting criteria are met. Special accounting
for qualifying hedges allows a derivative's gains and losses to offset related
results on the hedged item in the income statement, and requires that a company
must formally document, designate and assess the effectiveness of transactions
that receive hedge accounting.

         We adopted SFAS No. 133 effective January 1, 2001, and the adoption did
not have a material impact on our results of operations.

         In June 2001, the Financial Accounting Standards Board issued
Statements of Financial Accounting Standards No. 141, Business Combinations, and
No. 142, Goodwill and Other Intangible Assets, effective for fiscal years
beginning after December 15, 2001. Under the new rules, goodwill and intangible
assets deemed to have indefinite lives will no longer be amortized but will be
subject to annual impairment tests in accordance with the Statements. Other
intangible assets will continue to be amortized over their useful lives.




                                       23

<PAGE>

         The Company will apply the new rules on accounting for goodwill and
other intangible assets beginning in the first quarter of 2002. Application of
the nonamortization provisions of the Statement is expected to result in an
increase in net income of approximately $8.0 million ($.16 per diluted share)
per year. During 2002, the Company will perform the first of the required
impairment tests of goodwill and indefinite lived intangible assets as of
January 1, 2002 and has not yet determined what the effect of these tests will
be on the earnings and financial position of the Company.


I
TEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         Interest Rate Risk. We have long-term debt and revolving lines of
credit subject to the risk of loss associated with movements in interest rates.

         Currently, we have floating rate obligations totaling approximately
$86.3 million for amounts borrowed under our revolving lines of credit. These
floating-rate obligations expose us to the risk of increased interest expense in
the event of increases in short-term interest rates. If the floating interest
rate were to increase by 1% from September 30, 2001 levels, our combined
interest expense would increase by a total of approximately $70,000 per month.

         Foreign Currency Exchange Rate Risk. Our operations are conducted in
various countries around the world in a number of different currencies. As such,
our earnings are subject to change due to movements in foreign currency exchange
rates when transactions are denominated in currencies other than the U.S.
dollar, which is our functional currency. In order to mitigate the effects of
exchange rate risks, we generally pay a portion of our expenses in local
currencies and a substantial portion of our contracts provide for collections
from customers in U.S. dollars. As of September 30, 2001, we had Canadian
dollar-denominated debt totaling approximately $17 million.




                                       24

<PAGE>
                          PART II -- OTHER INFORMATION


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)      INDEX OF EXHIBITS


<Table>
<Caption>
                                  EXHIBIT NO.                          DESCRIPTION
                                  -----------                          ----------- 
<S>                               <C>            <C>
                                      3.1        --  Amended and Restated Certificate of Incorporation
                                                     (incorporated by reference to Exhibit 3.1 to the
                                                     Company's Annual Report on Form 10-K for the
                                                     year ended December 31, 2000, as filed with the
                                                     Commission on March 30, 2001).

                                      3.2        --  Amended and Restated Bylaws (incorporated by
                                                     reference to Exhibit 3.2 to the Company's Annual
                                                     Report on Form 10-K for the year ended December
                                                     31, 2000, as filed with the Commission on March 30,
                                                     2001).

                                      3.3        --  Certificate of Designations of Special Preferred
                                                     Voting Stock of Oil States International, Inc.
                                                     (incorporated by reference to Exhibit 3.3 to the
                                                     Company's Annual Report on Form 10-K for the
                                                     year ended December 31, 2000, as filed with the
                                                     Commission on March 30, 2001).

                                      4.1        --  Form of common stock certificate (incorporated
                                                     by reference to Exhibit 4.1 of Oil States'
                                                     Registration Statement No. 333-43400 on Form S-1).

                                      4.2        --  Amended and Restated Registration Rights Agreement
                                                     (incorporated by reference to Exhibit 4.2 to the
                                                     Company's Annual Report on Form 10-K for the
                                                     year ended December 31, 2000, as filed with the
                                                     Commission on March 30, 2001).

                                     10.1        --  Combination Agreement dated as of July 31, 2000 by
                                                     and among Oil States International, Inc., HWC Energy
                                                     Services, Inc., Merger Sub-HWC, Inc., Sooner Inc.,
                                                     Merger Sub-Sooner, Inc. and PTI Group Inc.
                                                     (incorporated by reference to Exhibit 10.1 of Oil
                                                     States' Registration Statement No. 333-43400 on
                                                     Form S-1).

                                     10.2        --  Plan of Arrangement of PTI Group Inc. (incorporated
                                                     by reference to Exhibit 10.2 to the Company's
                                                     Annual Report on Form 10-K for the year ended December
                                                     31, 2000, as filed with the Commission on March 30,
                                                     2001).

                                     10.3        --  Support Agreement between Oil States International,
                                                     Inc. and PTI Holdco (incorporated by reference
                                                     to Exhibit 10.3 to the Company's Annual Report on
                                                     Form 10-K for the year ended December 31, 2000, as
                                                     filed with the Commission on March 30, 2001).

                                     10.4        --  Voting and Exchange Trust Agreement by and
                                                     among Oil States International, Inc., PTI Holdco and
                                                     Montreal Trust Company of Canada (incorporated by
                                                     reference to Exhibit 10.4 to the Company's Annual Report on
                                                     Form 10-K for the year ended December 31, 2000, as
                                                     filed with the Commission on March 30, 2001).

                                     10.5**      --  2001 Equity Participation Plan (incorporated by
                                                     reference to Exhibit 10.5 to the Company's
                                                     Annual Report on Form 10-K for the year ended December
                                                     31, 2000, as filed with the Commission on March 30,
                                                     2001).

                                     10.6**      --  Form of Deferred Compensation Plan
                                                     (incorporated by reference to Exhibit 10.6 of Oil States'
                                                     Registration Statement No. 333-43400 on Form S-1).
</TABLE>





                                       25

<PAGE>

<TABLE>
<S>                                  <C>         <C>
                                     10.7**      --  Annual Incentive Compensation Plan (incorporated by
                                                     reference to Exhibit 10.7 to the Company's
                                                     Annual Report on Form 10-K for the year ended December
                                                     31, 2000, as filed with the Commission on March 30,
                                                     2001).

                                     10.8**      --  Executive Agreement between Oil States
                                                     International, Inc. and Douglas E. Swanson (incorporated by
                                                     reference to Exhibit 10.8 to the Company's
                                                     Annual Report on Form 10-K for the year ended December
                                                     31, 2000, as filed with the Commission on March 30,
                                                     2001).

                                     10.9**      --  Executive Agreement between Oil States
                                                     International, Inc. and Cindy B. Taylor (incorporated by
                                                     reference to Exhibit 10.9 to the Company's Annual Report
                                                     on Form 10-K for the year ended December 31, 2000,
                                                     as filed with the Commission on March 30, 2001).

                                     10.10**     --  Form of Executive Agreement between Oil States
                                                     International, Inc. and other Named Executive
                                                     Officers (Messrs. Hughes and Chaddick)
                                                     (incorporated by reference to Exhibit 10.10 of Oil States'
                                                     Registration Statement No. 333-43400 on Form S-1).

                                     10.11**     --  Form of Change of Control Severance Plan for
                                                     Selected Members of Management (incorporated by
                                                     reference to Exhibit 10.11 of Oil States' Registration
                                                     Statement No. 333-43400 on Form S-1).

                                     10.12       --  Credit Agreement among Oil States International,
                                                     Inc., PTI Group Inc., the Lenders named therein,
                                                     Credit Suisse First Boston, Credit Suisse First
                                                     Boston Canada, Hibernia National Bank and Royal
                                                     Bank of Canada (incorporated by reference to Exhibit
                                                     10.12 of Oil States' Registration Statement No.
                                                     333-43400 on Form S-1).

                                     10.13A**    --  Restricted Stock Agreement, dated February 8, 2001,
                                                     between Oil States International, Inc. and Douglas E.
                                                     Swanson (incorporated by reference to Exhibit
                                                     10.13A of Oil States Report on Form 10Q filed May 15,
                                                     2001).

                                     10.13B**    --  Restricted Stock Agreement, dated February 22, 2001,
                                                     between Oil States International, Inc. and Douglas E.
                                                     Swanson (incorporated by reference to Exhibit 10.13B
                                                     of Oil States Report on Form 10Q filed May 15, 2001).

                                     10.14**     --  Form of Indemnification Agreement (incorporated by
                                                     reference to Exhibit 10.14 of Oil States'
                                                     Registration Statement No. 333-43400 on Form S-1).

                                     10.15**     --  Compensation Letter Agreement between HWC Energy
                                                     Services, Inc. and Jay Trahan (incorporated by
                                                     reference to Exhibit 10.15 to the Company's Annual
                                                     Report on Form 10-K for the year ended December 31,
                                                     2000, as filed with the Commission on March 30, 2001).

                                     16.1        --  Letter Regarding Change in Certifying Accountant
                                                     (incorporated by reference to Exhibit 16.1 of Oil
                                                     States' Registration Statement No. 333-43400 on
                                                     Form S-1).

                                     21.1        --  List of subsidiaries of the Company (incorporated by
                                                     reference to Exhibit 21.1 of Oil States' Registration
                                                     Statement No. 333-43400 on Form S-1).
</Table>

-----------

*  Filed herewith
** Management contracts or compensatory plans or arrangements.

(b)   REPORTS ON FORM 8-K. No reports on Form 8-K were filed during the period 
      covered by this report.




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<PAGE>


                                   SIGNATURES

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


                             OIL STATES INTERNATIONAL, INC.

       Date:  November 13, 2001      By          /s/ CINDY B. TAYLOR
           ------------------------     ----------------------------------------
                                                     Cindy B. Taylor
                                         Senior Vice President, Chief Financial
                                                       Officer and
                                        Treasurer (Principal Financial Officer)


       Date:  November 13, 2001      By         /s/ ROBERT W. HAMPTON
           ------------------------     ----------------------------------------
                                                     Robert W. Hampton
                                        Vice President -- Finance and Accounting
                                                           and
                                        Secretary (Principal Accounting Officer)





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