Delta Reports Record Fiscal 1999 Net Income of $1.1 Billion and Record June Quarter Net Income Of $364 Million

Press Release:DELTA AIR LINES, INC.

Delta Reports Record Fiscal 1999 Net Income of $1.1 Billion and Record June Quarter Net Income Of $364 Million;
$750 Million Share Repurchase Completed Six Months Early; Earnings Exceed Consensus Estimates
CONSOLIDATED FISCAL 1999 PERFORMANCE HIGHLIGHTS (Includes 4th Quarter ASA Results)
* Record Net Income of $1.1 Billion, Up 10% * Diluted Income Per Common Share of $7.20, Up 14% * Record Operating Revenues of $14.7 Billion, Up 4% * Record Operating Income of $1.9 Billion, Up 10% * Operating Margin of 12.7%, Up 0.7 Points * Load Factor of 72.6, Up 0.5 Points
CONSOLIDATED JUNE 1999 QUARTER PERFORMANCE HIGHLIGHTS
* Record Net Income of $364 Million, Up 1% * Diluted Income Per Common Share of $2.40, Up 6% * Record Operating Income of $642 Million, Up 8% * Record Operating Revenues of $4 Billion, Up 5% * Operating Margin of 16.2%, Up 0.4 Points

July 21,1999
ATLANTA -- Delta Air Lines (NYSE: DAL ) Friday reported record unaudited net income of $1.1 billion ($7.20 diluted income per common share) for fiscal 1999, a 10 percent increase from the fiscal 1998 record net income of $1.0 billion ($6.34 diluted income per common share).

Delta also reported record unaudited net income of $364 million ($2.40 diluted income per common share) for the June 1999 quarter, the fourth quarter of Delta's fiscal year. Delta's June quarter net income increased one percent from the fiscal 1998 record of $362 million ($2.26 diluted income per common share).

"Delta's record fiscal 1999 and June quarter financial performance reflect the company's solid financial strength and our continued commitment to improve customer service, build a stronger partnership with our employees, and create substantial returns for shareowners,'' said Leo F. Mullin, Delta's president and chief executive officer.

Delta was honored several times during fiscal year 1999 for its improvements in financial, operational and customer service performance. The carrier was named ``Airline of the Year'' by Air Transport World magazine and ``Best-Managed Major Airline'' for 1999 by Aviation Week & Space Technology magazine. In addition, the airline's technical operations function received Aviation Week & Space Technology's Maintenance, Repair, and Overhaul Business Innovation Award for 1999.

Becoming #1 In The Eyes of Our Customers

"While awards such as those we received this year are gratifying, our goal is to be 'Number One' in the eyes of our customers,'' said Mullin. ``We have more to accomplish in this area, but fiscal 1999 marked some significant progress on a number of important customer service fronts."


Based on the Department of Transportation data for the year ending May
1999 of the ten major airlines, Delta ranked:
Second in On-Time
Second in Fewest Mishandled Bags
Third in Fewest Customer Complaints


Delta was the only airline to be ranked in the top three for all these measures -- on-time, fewest mishandled bags and fewest customer complaints -- while carrying more passengers (106 million) in its Fiscal Year 1999 than any other airline in the world.

Also during fiscal year 1999, Delta:
* Completed interior refurbishments on 487 aircraft, thereby completing a
full fleet interior refurbishment program begun in October 1997.
* Introduced BusinessElite, Delta's industry-leading, intercontinental
premium business-class product enabling passengers to enjoy the world's
best travel experience at business-class fares.
* Enhanced its electronic commerce capabilities through partnerships with
priceline.com and with iXL, enabling expanded access to customers
through the Internet.
* Introduced new gate and boarding technology to simplify the customer
check-in experience, allowing faster and more efficient aircraft
boarding. The new technology also simplifies and improves the flow of
information to customer service agents.


"While acknowledging these achievements -- all accomplished through the hard work of Delta people -- we recognize the work that remains to be done,'' Mullin continued. "Just as we focused on improving our on-time performance, we will be applying the same dedication this year to improving the customer experience,'' he said.

He expressed disappointment relative to one area of customer service -- involuntary denied boardings -- where Delta's performance has been unsatisfactory.

He indicated that Delta would be accelerating efforts to improve performance in this area in the upcoming year.

Traveling from Anywhere to Everywhere

During fiscal 1999, Delta strengthened its network through a number of strategic moves. In the June quarter, Delta completed its acquisition of Atlantic Southeast Airlines (ASA), which now operates as a wholly-owned subsidiary of Delta. Improvements are already underway to enhance service for both customers and communities served by ASA through closer integration of schedules and improved operations, as well as strengthening Delta's financial performance.

In June, Delta and Air France announced a strategic alliance which will lay the foundation for a major global multi-carrier alliance. The two carriers and their future world airline partners will be cooperating in all areas to ensure quality and consistency of service for customers no matter where they fly.

Delta also expanded its successful Delta Shuttle product by initiating non-stop service from Boston's Logan to Washington's Ronald Reagan Airport providing northeast business travelers eight convenient frequencies each day. In addition, Delta Express, Delta's low cost operation, grew to 37 aircraft and 168 daily flights during the year while maintaining its enviable operational record.

"We will continue to build our network to provide passengers the ability to get from anywhere to everywhere on Delta through profitable growth and by strengthening our partnerships with alliance and connection carriers,'' said Mullin.

Producing Consistently Superior Financial Results

Fiscal year 1999 marks the second year that Delta has exceeded $1 billion in net earnings. For 13 straight months in North America, Delta has outpaced the industry in revenue per available seat mile (RASM). In addition, Delta continues to have the lowest cost per available seat mile of the major network carriers.

Delta continues to implement a prudent jet fuel hedging strategy which has reduced its exposure to volatility in jet fuel prices. Taking advantage of favorable market conditions earlier this year, Delta hedged approximately 80 percent of its estimated fiscal year 2000 jet fuel consumption.

Delta's $750 million common stock repurchase program, announced in July 1998 and originally targeted for completion in December 1999, was completed during the June quarter, reflecting Delta's excellent financial condition and ability to generate strong cash flows. Since April 1996, Delta has repurchased approximately 46 million common shares for $2.1 billion.

Partnerships with Delta People

"Our success this year is due to the tremendous efforts of all Delta people. Their commitment to a high level of performance and excellent customer service produced these record financial results. Delta people make it possible to provide ever better service while delivering consistently superior financial results,'' said Mullin.

In January, Delta increased the salaries of all employees, reflecting a corporate commitment to keep Delta employees at or near the top of the industry in total compensation in return for top productivity. Additionally, improvements were made to work life issues including enhanced educational reimbursement, new adoption financial assistance, everyday casual dress, extended benefits for military reservists serving in Kosovo, as well as other issues important to Delta employees and their families.

"We are confident that Delta enters fiscal year 2000 with the momentum to fulfill our commitment to improve customer service and, at the same time, deliver continued strong financial returns for all Delta shareowners,'' Mullin concluded.

Delta is the world's most flown carrier, carrying more than 105 million passengers in 1998. Delta, Delta Express, the Delta Shuttle, the Delta Connection carriers and Delta's Worldwide Partners operate 5,281 flights each day to 351 cities in 59 countries.

SOURCE: Delta Air Lines, Inc.