Delta Air Lines Reports June 2008 Quarter Financial Results




      Company reports $137 million profit excluding special charges 

    Unprecedented fuel prices increase costs by more than $1 billion

ATLANTA, July 16, 2008 (PRIME NEWSWIRE) -- Delta Air Lines (NYSE:DAL) today reported results for the quarter ended June 30, 2008. Key points include:



 *  Delta's net income for the June 2008 quarter excluding special 
    charges was $137 million, or $0.35 per diluted share, despite 
    a more than $1 billion year-over-year increase in fuel input 
    costs related to higher prices.(1,2,3)
 *  Including special charges of $1.2 billion, Delta's reported 
    net loss for the June 2008 quarter was $1.0 billion, or $2.64 
    per diluted share. 
 *  Delta's merger with Northwest Airlines is targeted to close 
    during the fourth quarter of 2008. The company expects 
    approximately $2 billion in annual merger-related synergies by 
    2012 with cash integration costs of approximately $600 million 
    over three years.
 *  As of June 30, 2008, Delta had $4.3 billion in unrestricted 
    liquidity, including $1 billion available under its revolving 
    credit facility. 

"When faced with the challenge of unprecedented fuel prices, Delta distinguished itself by reacting quickly and decisively with strong topline growth, domestic capacity rationalization, cost initiatives, fuel hedging, and a focus on preserving liquidity -- while continuing to run a great airline and deliver exceptional customer service," said Richard Anderson, Delta's chief executive officer. "With our talented employees, revenue momentum, a solid balance sheet, and our game-changing merger with Northwest, we are well positioned to seize opportunities in the current environment and strengthen our leadership position as the global airline of choice."

June Quarter Financial Results

Including special charges of $1.2 billion, net of tax, primarily related to the impairment of goodwill and other intangibles, Delta reported a net loss for the June 2008 quarter of $1.0 billion. Excluding special and reorganization items in both periods, Delta had net income of $137 million in the second quarter of 2008 compared to net income of $274 million in the second quarter of 2007(4). The year-over-year decrease in net income was driven primarily by unprecedented fuel prices, partially offset by an increase in operating revenue from international expansion.

In March, Delta announced it had recalibrated its 2008 business plan with a focus on preserving liquidity in light of the significant increase in crude oil prices. During the June quarter, as fuel prices continued to rise, the airline reevaluated its flight schedule, targeting additional reductions in capacity. Delta now expects system capacity for the second half of 2008 to be down 4% compared to 2007, with domestic capacity down 13% and international capacity up 14%. The company is now targeting to remove the equivalent of 100 regional aircraft from the system by the end of the year. Through aggressive revenue and cost initiatives, including expansion of its international network, and utilization of its fuel hedge strategy, the company expects to cover approximately $3 billion of the estimated $4 billion raw impact of higher fuel input costs in 2008. Delta expects to end the year with a liquidity position of $3.2 billion, including $1 billion available under its revolving credit facility.

"The fact that we mitigated nearly 80% of the impact of higher fuel input cost this quarter while improving our liquidity is a testament to both the strength of our action plan and the can-do spirit of the Delta people," said Edward Bastian, Delta's president and chief financial officer. "Unprecedented fuel prices have created a real crisis in the airline industry, and Delta has been a leader in responding with quick, decisive action."

Merger with Northwest

In April, Delta announced an agreement to merge with Northwest Airlines -- creating a formidable, long-term competitor with the revenue-generating power of a diverse global network combined with a best-in-class cost structure and solid balance sheet. The companies are targeting to close the merger by the end of 2008.

Initial synergy estimates for the merger were based on a high-level approach. Since that time, the companies have formed teams to plan the integration of the two airlines and to review the full benefits of the merger taking a very detailed, bottom-up approach. Delta forecasts $500 million in synergies in 2009, increasing up to the full run-rate of approximately $2.0 billion in annual synergies by 2012. In addition, estimated cash integration costs have been refined and are expected to be approximately $600 million over three years.

The companies have achieved several significant milestones on the path toward closing the merger and completing a seamless integration of the airlines, including:



   *  Reaching an unprecedented pre-merger joint collective bargaining 
      agreement between the Delta and Northwest units of the Air Line 
      Pilots Association. This four-year agreement through 2012, which 
      includes a process to establish an integrated pilot seniority
      list upon the closing of the merger, will give Delta the full 
      ability to realize network and fleeting synergies. Pilots at 
      both companies will receive pay raises and an equity stake in 
      the combined company. The tentative agreement is subject to 
      ratification by both airlines' pilot groups, which is expected 
      by mid-August.
   *  Announcing a post-merger organizational structure and the 
      executives who will hold key leadership positions in the 
      combined airline. 
   *  Forming 25 joint Delta-Northwest teams to plan integration 
      activities and drive synergy achievement. These teams, which 
      cover areas from operations to corporate support, are 
      prioritizing integration activities with a focus on optimizing 
      synergies and planning for a seamless operational and customer 
      transition to the new Delta.
   *  Scheduling special meetings of Delta and Northwest stockholders 
      to obtain the necessary stockholder approvals to close the 
      merger. The meetings will be held on Sept. 25, 2008 in Atlanta 
      (Delta) and New York (Northwest).

Revenue Momentum

Delta continued to deliver strong revenue growth as a result of its international network investment, cargo and ancillary business revenue growth, and aggressive yield management. June 2008 quarter revenue improved 10%, or almost $500 million, year over year. Based on the most recently available ATA data, Delta achieved a revenue premium to the industry -- its consolidated length of haul adjusted passenger unit revenue (PRASM) was 102% of industry average PRASM (excluding Delta) for the first five months of the year. Delta reached its goal of closing the PRASM gap to the industry a year ahead of schedule.

Comparisons of revenue-related statistics are as follows:



                           June 2008 Quarter vs. June 2007 Quarter
                     --------------------------------------------------
                                           Latin
                      System   Domestic   America   Atlantic   Pacific
                      ------   --------   -------   --------   -------

 Passenger Revenue     6.2%     (1.0)%     16.2%      25.0%     115.5%
 Passenger Unit        
  Revenue              4.5%      4.9%      17.5%       6.6%      (9.4)% 
 Yield                 3.9%      4.1%       8.7%       7.6%       1.9%
 Traffic               2.2%     (4.9)%      6.9%      16.2%     111.4%
 Capacity              1.6%     (5.7)%    (1.1)%      17.2%     138.0%
 Load Factor         0.5 pts    0.7 pts   5.9 pts  (0.7) pts  (9.5) pts

The company is also focused on increasing non-passenger revenue. Revenue from Cargo operations increased 36% year over year due to significantly improved yields and higher volume, particularly in international markets. Other, net revenue grew $177 million, or 45%, reflecting an increase in passenger fees, growth in third-party Maintenance Repair and Overhaul (MRO) business, and additional revenue from the SkyMiles program.

Cost Discipline

Delta's operating expenses increased $2.1 billion, or 46%, compared to the June 2007 quarter, which reflects special charges of $1.3 billion and a more than $1 billion increase in costs due to higher fuel prices, partially offset by fuel hedging gains. Excluding the special charges described below, Delta's operating expenses increased 17%, or $782 million. Non-operating expenses, excluding special items, declined 40%, or $50 million, in the June 2008 quarter due to FAS 133 mark-to-market on hedges and lower effective interest rates.

Delta's mainline unit cost (CASM(5)) increased 51% to 15.67 cents for the June 2008 quarter compared to the prior year period, reflecting special charges and the significant increase in fuel costs. Excluding fuel expense and special items, mainline CASM increased 1% to 7.03 cents compared to the June 2007 quarter.

Special and Reorganization Items

Delta recorded special charges totaling $1.2 billion in the June 2008 quarter, including a $1.1 billion non-cash charge, net of a $119 million tax benefit, related to the impairment of goodwill and other intangibles. This charge represented the finalization of the $6.1 billion impairment charge taken in the March 2008 quarter and reflects the completion of impairment testing, including third party valuation procedures. Additional special charges included a $96 million severance charge for the previously announced voluntary workforce reduction programs and a $6 million charge related to facilities restructuring.

In the second quarter of 2007, Delta recorded income of $1.3 billion from reorganization and related items, primarily due to the discharge of claims and liabilities in connection with its bankruptcy proceedings and the adoption of fresh start reporting.

Liquidity Position

At the end of the June 2008 quarter, Delta had $3.3 billion in unrestricted cash, cash equivalents and short-term investments, including $671 million of cash collateral deposits received from counterparties to fuel hedging contracts. Delta has an additional $1 billion available under its revolving credit facility, resulting in a total unrestricted liquidity of $4.3 billion. At June 30, the company is in full compliance with all financial covenants.

Delta had $261 million in capital expenditures during the June 2008 quarter, with $222 million for investments in aircraft, parts and modifications.

Fuel Hedging

During the June 2008 quarter, Delta hedged 49% of its fuel consumption resulting in an average fuel price of $3.13 per gallon. Delta realized $313 million in gains on fuel hedge contracts settled during the quarter.

As of July 11, 2008, Delta had the following fuel hedges in place:



                               Jet Fuel
                  Percent     Equivalent
                  Hedged         Cap
                  -----------------------
     Q3 2008        48%         $2.94
     Q4 2008        46%         $3.42
     2009           21%         $3.48
     2010           5%          $3.05

June 2008 Quarter Highlights

During the June 2008 quarter, Delta continued the positive momentum in its business, demonstrating its ongoing commitment to maintain strong employee relations and deliver an industry-leading customer experience. Highlights include:



  *  The National Mediation Board announced that a decisive majority --
     more than 60% -- of eligible Delta flight attendants rejected
     representation by the Association of Flight Attendants/
     Communication Workers of America, enabling Delta to continue
     a direct relationship with its flight attendants;
  *  The U.S. Department of Transportation issued a final order
     granting antitrust immunity for six-way alliance activities in
     trans-Atlantic markets for SkyTeam members Air France, Alitalia,
     CSA Czech Airlines, Delta, KLM Royal Dutch Airlines and Northwest
     Airlines, enabling the carriers to offer customers more choice in
     flight schedules, travel times, services and fares;
  *  Delta demonstrated continued commitment to superior operational
     performance by ranking in the top two of its competitive set for
     on-time performance for the last twelve months and by reducing 
     the number of mishandled bags by 32% year-over-year in the June
     quarter.
  *  Achievement of operational performance goals resulted in $10
     million in Shared Rewards payments to Delta employees during the
     quarter;
  *  Readers of Executive Travel magazine rated Delta the best airline
     in 2008 for domestic first class service, Crown Room Clubs and the
     SkyMiles program, demonstrating Delta's progress toward being the
     global airline of choice. They also preferred Delta to any other
     U.S. airline when traveling to Africa, the Middle East and Canada;
  *  Delta strengthened its international expansion strategy by
     exercising options for two B777-200LR for delivery in early 2010;
  *  Delta received the prestigious 2008 Green Cross for Safety Medal
     from The National Safety Council, which recognizes organizations
     and their leaders for outstanding achievements in safety and
     health, community service and responsible citizenship;
  *  Delta enhanced customer check-in options by partnering with the
     Transportation Security Administration to launch paperless mobile
     check-in for domestic travel on Delta and Delta Connection
     flights departing from Delta's main terminal at LaGuardia Airport;
     and
  *  Delta was the first U.S. airline to launch a comprehensive
     in-flight recycling program. Delta's program has successfully
     diverted 322 tons of waste since June 2007 and funded an 
     EarthCraft home for Habitat for Humanity, one of Delta's Force 
     for Global Good partners.

September 2008 Quarter and Full Year 2008 Guidance

The company projects the following for the September 2008 quarter and full year 2008:



                               3Q 2008 Forecast        2008 Forecast

                           -----------------------  --------------------
 Operating margin, 
  excluding special items           1 - 3%              Flat to (2)%

 Fuel price, including 
  taxes and hedges                  $3.52                  $3.32

 Capital expenditures           $350 million            $1.3 billion


                               3Q 2008 Forecast        2008 Forecast
                            (compared to 3Q 2007)    (compared to 2007)
                           -----------------------  -------------------- 
 Mainline unit costs -   
  excluding fuel and 
  related taxes and special 
  items                        Flat to down 2%         Flat to up 1%
 
 System capacity               Flat to down 2%             Flat
   Domestic                      Down 11-13%            Down 8 - 10%
   International                 Up 16 - 18%             Up 14-16%

 Mainline capacity                  Flat                 Up 0 - 2%
   Domestic                     Down 11 - 13%           Down 9 - 11%
   International                Up 17 - 19%             Up 15 - 17%

Ancillary Businesses

Delta's ancillary businesses include TechOps, the largest airline MRO organization in North America, serving more than 100 aviation and airline customers around the world, and DAL Global Services, which provides general aviation services, training and technical services, and staffing to airlines including Delta. The MRO business increased operating revenue more than 60% year over year in the June quarter and continued to post double-digit margins. The following table provides summarized financial information about these businesses for the June 2008 quarter.



                                             Three Months Ended
                                               June 30, 2008
                                         --------------------------
                                          TechOps       DAL Global
                                           (MRO)         Services
                                         --------------------------

      Operating Revenue (in millions)      $127            $57

      Operating Margin                      12%             3%

Other Matters

Included with this press release are Delta's Consolidated Statements of Operations for the three and six months ended June 30, 2008 and 2007; a statistical summary for those periods; selected balance sheet data as of June 30, 2008 and Dec. 31, 2007; fleet information as of June 30, 2008; and a reconciliation of certain non-GAAP financial measures.

About Delta

Delta Air Lines operates service to more worldwide destinations than any airline with Delta and Delta Connection flights to 327 destinations in 62 countries. Delta has added more international capacity than any major U.S. airline during the last two years and is the leader across the Atlantic with flights to 44 trans-Atlantic markets. To Latin America and the Caribbean, Delta offers 609 weekly flights to 62 destinations. Delta's marketing alliances also allow customers to earn and redeem SkyMiles on more than 16,000 flights offered by SkyTeam and other partners. Delta is a founding member of SkyTeam, a global airline alliance that provides customers with extensive worldwide destinations, flights and services. Including its SkyTeam and worldwide codeshare partners, Delta offers flights to 499 worldwide destinations in 105 countries. Customers can check in for flights, print boarding passes and check flight status at delta.com.

The Delta Air Lines, Inc. logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=1825

Endnotes



 1  In connection with its emergence from bankruptcy on April 30, 2007,
    Delta adopted fresh start reporting in accordance with American 
    Institute of Certified Public Accountants' Statement of Position 
    90-7, "Financial Reporting by Entities in Reorganization under the
    Bankruptcy Code." The adoption of fresh start reporting resulted in 
    Delta's becoming a new entity for financial reporting purposes. 
    Accordingly, Delta's consolidated financial statements after 
    April 30, 2007 are not comparable to its financial statements for 
    any period prior to emergence. References in this press release 
    to "Successor" refer to Delta on or after May 1, 2007, giving effect
    to fresh start reporting. References to "Predecessor" refer to Delta 
    prior to May 1, 2007.

 2  Note 1 to the attached Consolidated Statements of Operations 
    provides a reconciliation of certain non-GAAP financial measures 
    used in this release and provides the reasons management uses those 
    measures.

 3  Includes fuel prices paid under our contract carrier arrangements.

 4  Reorganization items refers to revenues, expenses, gains or losses 
    that we realized or incurred due to our reorganization under 
    Chapter 11 of the U.S. Bankruptcy Code. In accordance with GAAP, 
    these items are separately classified in the Predecessor's 
    Consolidated Statements of Operations.

 5  Delta excludes from mainline unit costs expenses for aircraft 
    maintenance and staffing services which it provides to third 
    parties because these expenses are not related to the generation 
    of a seat mile. Similarly, Delta excludes from passenger unit 
    revenues, and includes in other revenue, revenues received for 
    providing aircraft maintenance and staffing services to third 
    parties. Management believes these classifications provide a more 
    consistent and comparable reflection of Delta's mainline operations.

Statements in this news release that are not historical facts, including statements regarding our estimates, expectations, beliefs, intentions, projections or strategies for the future, may be "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. All forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from the estimates, expectations, beliefs, intentions, projections and strategies reflected in or suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the cost of aircraft fuel; the impact that our indebtedness will have on our financial and operating activities and our ability to incur additional debt; the restrictions that financial covenants in our financing agreements will have on our financial and business operations; labor issues; interruptions or disruptions in service at one of our hub airports; our increasing dependence on technology in our operations; our ability to retain management and key employees; the ability of our credit card processors to take significant holdbacks in certain circumstances; the effects of terrorist attacks; and competitive conditions in the airline industry.

Forward-looking statements in the press release that relate to our proposed merger transaction with Northwest Airlines Corporation include, without limitation, our expectations with respect to the synergies, costs and charges, capitalization and anticipated financial impacts of the merger transaction and related transactions; approval of the merger transaction and related transactions by shareholders; the satisfaction of the closing conditions to the merger transaction and related transactions; and the timing of the completion of the merger transaction and related transactions. Factors that may cause the actual results to differ materially from the expected results include, but are not limited to, the possibility that the expected synergies will not be realized, or will not be realized within the expected time period, due to, among other things, (1) the airline pricing environment; (2) competitive actions taken by other airlines; (3) general economic conditions; (4) changes in jet fuel prices; (5) actions taken or conditions imposed by the United States and foreign governments; (6) the willingness of customers to travel; (7) difficulties in integrating the operations of the two airlines; (8) the impact of labor relations; and (9) fluctuations in foreign currency exchange rates. Other factors include the possibility that the merger does not close, including due to the failure to receive required stockholder or regulatory approvals, or the failure of other closing conditions.

Additional information concerning risks and uncertainties that could cause differences between actual results and forward-looking statements is contained in Delta's Securities and Exchange Commission filings, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2007. Caution should be taken not to place undue reliance on Delta's forward-looking statements, which represent Delta's views only as of July 16, 2008, and which Delta has no current intention to update.

Additional Information About the Merger and Where to Find It

In connection with the proposed merger, Delta filed with the Securities and Exchange Commission ("SEC") a Registration Statement on Form S-4 that includes a preliminary joint proxy statement of Delta and Northwest that also constitutes a prospectus of Delta. At the appropriate time, Delta and Northwest will mail the final joint proxy statement/prospectus to their stockholders. Delta and Northwest urge investors and security holders to read the final joint proxy statement/prospectus regarding the proposed merger when it becomes available because it will contain important information. You may obtain copies of all documents filed with the SEC regarding this transaction, free of charge, at the SEC's website (www.sec.gov). You may also obtain these documents, free of charge, from Delta's website (www.delta.com) under the tab "About Delta" and then under the heading "Investor Relations" and then under the item "SEC Filings." You may also obtain these documents, free of charge, from Northwest's website (www.nwa.com) under the tab "About Northwest" and then under the heading "Investor Relations" and then under the item "SEC Filings and Section 16 Filings."

Delta, Northwest and their respective directors, executive officers and certain other members of management and employees may be soliciting proxies from Delta and Northwest stockholders in favor of the merger. Information regarding the persons who may, under the rules of the SEC, be deemed participants in the solicitation of Delta and Northwest stockholders in connection with the proposed merger will be set forth in the proxy statement/prospectus when it is filed with the SEC. You can find information about Delta's executive officers and directors in its definitive proxy statement filed with the SEC on April 25, 2008 related to Delta's 2008 Annual Meeting of Stockholders. You can find information about Northwest's executive officers and directors in its Amendment to its Annual Report on Form 10-K filed with the SEC on April 29, 2008. You can obtain free copies of these documents from Delta and Northwest using the contact information above.



                        DELTA AIR LINES, INC.
                Consolidated Statements of Operations
                             (Unaudited)

                               (Successor)    (Predecessor)  (Combined)
                              Three     Two        One          Three
                              Months   Months     Month         Months
                              Ended    Ended      Ended         Ended
 (in millions, except per    June 30, June 30,   April 30,     June 30,
  share data)                  2008     2007       2007          2007
 ----------------------------------------------------------------------
  OPERATING REVENUE:
   Passenger:
    Mainline                 $ 3,627  $ 2,338    $ 1,046       $ 3,384
    Regional affiliates        1,143      760        349         1,109
   Cargo                         160       82         36           118
   Other, net                    569      268        124           392
                             -------  -------    -------       -------
    Total operating revenue    5,499    3,448      1,555         5,003
 OPERATING EXPENSES:
  Aircraft fuel and related
   taxes                       1,678      790        322         1,112
  Salaries and related costs   1,092      708        331         1,039
  Contract carrier
   arrangements (1)              931      530        239           769
  Depreciation and
   amortization                  302      193         95           288
  Aircraft maintenance
   materials and outside
   repairs                       295      165         82           247
  Contracted services            257      160         83           243
  Passenger commissions and
   other selling expenses        248      175         78           253
  Landing fees and other
   rents                         185      122         60           182
  Passenger service              105       61         24            85
  Aircraft rent                   67       36         20            56
  Impairment of goodwill and
   other intangible assets     1,196       --         --            --
  Restructuring and related
   items                         104       --         --            --
  Profit sharing                  --       65         14            79
  Other                          126       98         62           160
                             -------  -------    -------       -------
   Total operating expense     6,586    3,103      1,410         4,513
                             -------  -------    -------       -------
 OPERATING (LOSS) INCOME      (1,087)     345        145           490
 OTHER (EXPENSE) INCOME:
  Interest expense              (141)    (120)       (62)         (182)
  Interest income                 25       33          4            37
  Miscellaneous, net              40        9         (2)            7
                             -------  -------    -------       -------
    Total other expense, net     (76)     (78)       (60)         (138)
                             -------  -------    -------       -------
 (LOSS) INCOME BEFORE
  REORGANIZATION ITEMS, NET   (1,163)     267         85           352
 REORGANIZATION ITEMS, NET        --       --       1339         1,339
                             -------  -------    -------       -------
 (LOSS) INCOME BEFORE INCOME
  TAXES                       (1,163)     267      1,424         1,691
 INCOME TAX BENEFIT
  (PROVISION)                    119     (103)         4           (99)
                             -------  -------    -------       -------
 NET (LOSS) INCOME           $(1,044) $   164    $ 1,428       $ 1,592
                             =======  =======    =======       =======
 BASIC (LOSS) INCOME PER
  SHARE                      $ (2.64) $  0.42    $  7.24            NM
                             =======  =======    =======       =======
 DILUTED (LOSS) INCOME PER
  SHARE                      $ (2.64) $  0.42    $  5.19            NM
                             =======  =======    =======       =======
 WEIGHTED AVERAGE SHARES USED
  IN BASIC (LOSS) INCOME PER
  SHARE CALCULATION            395.7    393.6      197.3            NM
                             =======  =======    =======       =======
 WEIGHTED AVERAGE SHARES
  USED IN DILUTED (LOSS)
  INCOME PER
  SHARE CALCULATION            395.7    393.8      233.7            NM
                             =======  =======    =======       =======

 (1)  Contract carrier arrangements expense includes $384 million and 
      $233 million for the three months ended June 30, 2008 and 2007, 
      respectively, for aircraft fuel and related taxes.


                        DELTA AIR LINES, INC.
                Consolidated Statements of Operations
                             (Unaudited)

                                (Successor)   (Predecessor)  (Combined)
                               Six      Two       Four           Six
                              Months   Months     Months        Months
                              Ended    Ended      Ended         Ended
 (in millions, except per    June 30, June 30,   April 30,     June 30,
  share data)                  2008     2007       2007          2007
 ----------------------------------------------------------------------
 OPERATING REVENUE:
  Passenger:
   Mainline                  $ 6,688  $ 2,338    $ 3,829       $ 6,167
   Regional affiliates         2,182      760      1,296         2,056
  Cargo                          294       82        148           230
  Other, net                   1,101      268        523           791
                             -------  -------    -------       -------
   Total operating revenue    10,265    3,448      5,796         9,244
 OPERATING EXPENSES:
  Aircraft fuel and related
   taxes                       3,100      790      1,270         2,060
  Salaries and related costs   2,183      708      1,302         2,010
  Contract carrier
   arrangements(1)             1,827      530        956         1,486
  Depreciation and
   amortization                  599      193        386           579
  Aircraft maintenance
   materials and outside
   repairs                       563      165        320           485
  Contracted services            511      160        326           486
  Passenger commissions and
   other selling expenses        473      175        298           473
  Landing fees and other
   rents                         364      122        250           372
  Passenger service              189       61         95           156
  Aircraft rent                  131       36         90           126
  Impairment of goodwill and
   other intangible assets     7,296       --         --            --
  Restructuring and related
   items                         120       --         --            --
  Profit sharing                  --       65         14            79
  Other                          257       98        189           287
                             -------  -------    -------       -------
   Total operating expenses   17,613    3,103      5,496         8,599
                             -------  -------    -------       -------
 OPERATING (LOSS) INCOME      (7,348)     345        300           645
 OTHER (EXPENSE) INCOME:
  Interest expense              (288)    (120)      (262)         (382)
  Interest income                 52       33         14            47
  Miscellaneous, net              31        9         27            36
                             -------  -------    -------       -------
   Total other expense, net     (205)     (78)      (221)         (299)
                             -------  -------    -------       -------
 (LOSS) INCOME BEFORE
  REORGANIZATION ITEMS, NET   (7,553)     267         79           346
  REORGANIZATION ITEMS, NET       --       --      1,215         1,215
                             -------  -------    -------       -------
 (LOSS) INCOME BEFORE INCOME
  TAXES                       (7,553)     267      1,294         1,561
 INCOME TAX BENEFIT
  (PROVISION)                    119     (103)         4           (99)
                             -------  -------    -------       -------
 NET (LOSS) INCOME           $(7,434) $   164    $ 1,298       $ 1,462
                             =======  =======    =======       =======
 BASIC (LOSS) INCOME PER
  SHARE                      $(18.79) $  0.42    $  6.58            NM
                             =======  =======    =======       =======
 DILUTED (LOSS) INCOME PER
  SHARE                      $(18.79) $  0.42    $  4.63            NM
                             =======  =======    =======       =======
 WEIGHTED AVERAGE SHARES USED
  IN BASIC (LOSS) INCOME PER
  SHARE CALCULATION            395.7    393.6      197.3            NM
                             =======  =======    =======       =======
 WEIGHTED AVERAGE SHARES USED
  IN DILUTED (LOSS) INCOME
  PER SHARE CALCULATION        395.7    393.8      233.7            NM
                             =======  =======    =======       =======

 (1)  Contract carrier arrangements expense includes $704 million and 
      $420 million for the six months ended June 30, 2008 and 2007, 
      respectively, in fuel expense.


                        DELTA AIR LINES, INC.
                         Statistical Summary
                             (Unaudited)

                                     (Successor)  (Combined)
                                       Three Months Ended
                                             June 30,
                                      ---------------------
                                        2008         2007      Change
                                      --------     --------   --------
 Consolidated:

  Revenue Passenger Miles
   (millions)(1)                        32,269       31,578     2.2%
  Available Seat Miles (millions)(1)    38,736       38,127     1.6%
  Passenger Mile Yield(1)                14.78 c      14.23 c   3.9%
  Passenger Revenue per Available
   Seat Mile (PRASM)(1)                  12.31 c      11.78 c   4.5%
  Operating Cost Per Available Seat
   Mile (CASM)(1)                        16.64 c      11.59 c  43.6%
   CASM excluding Special Items(1) -
    See Note 1                           13.28 c      11.36 c  16.9%
   CASM excluding Special Items and
    Fuel Expense and Related Taxes -
    See Note 1                            8.95 c       8.44 c   6.0%

  Passenger Load Factor(1)                83.3%        82.8%    0.5 pts
  Fuel Gallons Consumed (millions)         535          531     0.8%
  Average Price Per Fuel Gallon, net
   of hedging activity                $   3.13     $   2.09    49.8%
  Number of Aircraft in Fleet, End of
   Period                                  579          573     1.0%
  Full-Time Equivalent Employees, End
   of Period                            55,397       55,542    -0.3%

 Mainline:

  Revenue Passenger Miles (millions)    27,558       26,776     2.9%
  Available Seat Miles (millions)       32,902       32,130     2.4%
  Operating Cost Per Available
   Seat Mile (CASM)(1)                   15.67 c      10.41 c  50.5%
   CASM excluding Special Items -
    See Note 1                           11.72 c      10.13 c  15.7%
   CASM excluding Special Items and
    Fuel Expense and Related Taxes -
    See Note 1                            7.03 c       6.93 c   1.4%
  Number of Aircraft in Fleet, End of
   Period                                  450          440     2.3%

 Note: c = cents

 (1)  Includes the operations under our contract carrier agreements 
      of Atlantic Southeast Airlines, Inc., Chautauqua Airlines, Inc.,
      Freedom Airlines, Inc., Shuttle America Corporation, and SkyWest,
      Inc. for all periods presented; and ExpressJet Airlines, Inc. for
      the one month ended June 30, 2007 and the three months ended June
      30, 2008; and Pinnacle Airlines, Inc. for the three months ended 
      June 30, 2008.


                        DELTA AIR LINES, INC.
                         Statistical Summary
                             (Unaudited)

                                     (Successor)  (Combined)
                                      ---------    --------
                                        Six Months Ended
                                            June 30,
                                      ---------------------
                                        2008         2007      Change
                                      --------     --------   --------
 Consolidated:

  Revenue Passenger Miles
   (millions)(1)                        60,473       58,790     2.9%
  Available Seat Miles (millions)(1)    74,827       73,407     1.9%
  Passenger Mile Yield (1)               14.67 c      13.99 c   4.9%
  Passenger Revenue per Available Seat
   Mile (PRASM)(1)                       11.85 c      11.20 c   5.8%
  Operating Cost Per Available Seat
   Mile (CASM) (1)                       23.17 c      11.45 c 102.4%
   CASM excluding Special Items (1) -
    See Note 1                           13.26 c      11.33 c  17.0%
   CASM excluding Special Items and
    Fuel Expense and Related Taxes -
    See Note 1                            9.11 c       8.52 c   6.9%
  Passenger Load Factor(1)                80.8%        80.1%    0.7 pts
   Fuel Gallons Consumed (millions)      1,035        1,022     1.3%
  Average Price Per Fuel Gallon, net
   of hedging activity                $   2.99     $   2.02    48.0%
  Number of Aircraft in Fleet, End of
   Period                                  579          573     1.0%
  Full-Time Equivalent Employees, End
   of Period                            55,397       55,542    -0.3%

 Mainline:

  Revenue Passenger Miles (millions)    51,353       49,769     3.2%
  Available Seat Miles (millions)       63,172       61,684     2.4%
  Operating Cost Per Available Seat
   Mile (CASM)(1)                        23.42 c      10.21 c 129.4%
   CASM excluding Special Items -
    See Note 1                           11.68 c      10.07 c  16.0%
   CASM excluding Special Items and
    Fuel Expense and Related Taxes -
    See Note 1                            7.16 c       6.98 c   2.6%
  Number of Aircraft in Fleet, End of
   Period                                  450          440     2.3%

 Note: c = cents

 (1)  Includes the operations under our contract carrier agreements of 
      Atlantic Southeast Airlines, Inc., Chautauqua Airlines, Inc., 
      Freedom Airlines, Inc., Shuttle America Corporation, and SkyWest, 
      Inc. for all periods presented; and ExpressJet Airlines, Inc. for 
      the one month ended June 30, 2007 and the six months ended June 30, 
      2008; and Pinnacle Airlines, Inc. for the six months ended June 
      30, 2008.


                        DELTA AIR LINES, INC.
                     Selected Balance Sheet Data
                            (In Millions)

                                                    (Successor)
                                              June 30,    December 31,
                                            ------------  ------------
                                                2008          2007
                                            ------------  ------------
                                             (Unaudited)

 Cash and cash equivalents                    $  3,239      $  2,648
 Short-term investments                            103           138
 Restricted cash, including noncurrent             532           535
 Total assets                                   27,651        32,423
 Total debt and capital leases, including 
  current maturities                             9,134         9,000
 Total shareowners' equity                       3,721        10,113

Fleet Information

Our active fleet, orders, options and rolling options at June 30, 2008 are summarized in the following table. Options have scheduled delivery slots. Rolling options replace options and are assigned delivery slots as options expire or are exercised.



                    Current Fleet
           ------------------------------
  Aircraft        Capital Operating       Average                Rolling
    Type    Owned  Lease    Lease   Total   Age   Orders Options Options
 -----------------------------------------------------------------------
 B-737-700    --     --       --      --     --     10      --      --
 B-737-800    71     --       --      71    7.7      2(1)   60     120
 B-757-200    66     35       17     118   16.6     --      --      --
 B-757-200ER  --      2       15      17   10.4     --      --      --
 B-767-300     4     --       17      21   17.4     --      --      --
 B-767-300ER  50     --        9      59   12.3     --       7      --
 B-767-400ER  21     --       --      21    7.3     --      12      --
 B-777-200ER   8     --       --       8    8.4     --      --      --
 B-777-200LR   2     --       --       2    0.3      6      29      12
 MD-88        63     33       21     117   18.0     --      --      --
 MD-90        16     --       --      16   12.6     --      --      --
 CRJ-100      22     13       49      84   10.9     --      --      --
 CRJ-200       5     --       12      17    6.0     --      12      --
 CRJ-700      15     --       --      15    4.6     --      16      --
 CRJ-900      13     --       --      13    0.6      8(2)   30      --
 -----------------------------------------------------------------------
 Total       356     83      140     579   12.8     26     166     132
 =======================================================================

 (1)  Excludes 32 remaining aircraft which will be sold to third parties 
      immediately following delivery of these aircraft.

 (2)  Excludes 7 remaining aircraft orders we assigned to Pinnacle 
      Airlines in April 2007.

Note 1: The following tables show reconciliations of certain financial measures. The reasons Delta uses these measures are described below.



 * Cost per available seat mile (CASM) excludes $140 million and $93
   million for the three months ended June 30, 2008 and 2007,
   respectively, and $276 million and $196 million for the six months
   ended June 30, 2008 and 2007, respectively, in expenses related
   to providing maintenance and staffing services to third parties
   as these costs are not associated with the generation of a seat 
   mile;
 * Delta excludes special and reorganization related items because
   management believes the exclusion of these items is helpful to
   investors to evaluate the company's recurring operational
   performance;
 * Passenger revenue per available seat mile (PRASM) excludes the
   impact of fresh start reporting as management believes the
   exclusion of this item is helpful to investors to evaluate the
   company's recurring operational performance;
 * Delta presents length of haul adjusted PRASM excluding charter
   revenue because management believes this provides a more
   meaningful comparison of the company's PRASM to the industry;
 * Delta presents mainline CASM excluding fuel expense because
   management believes high fuel prices mask the company's progress
   toward its business plan targets; and

In connection with its emergence from bankruptcy on April 30, 2007, Delta adopted fresh start reporting in accordance with American Institute of Certified Public Accountants' Statement of Position 90-7, "Financial Reporting by Entities in Reorganization under the Bankruptcy Code." The adoption of fresh start reporting resulted in Delta's becoming a new entity for financial reporting purposes. Accordingly, Delta's consolidated financial statements after April 30, 2007 are not comparable to its financial statements for any period prior to emergence. However, to provide a basis of comparison to prior year results, Delta has combined the results for (a) the one month ended April 30, 2007 with the two months ended June 30, 2007 and (b) the four months ended April 30, 2007 with the two months ended June 30, 2007.



                                           (Successor)     (Combined)
                                              Three          Three
                                          Months Ended   Months Ended
                                          June 30, 2008  June 30, 2007
                                          -------------  -------------
 (in millions, except per share data)
 Net (loss) income                          $   (1,044)    $   (1,592)
 Items excluded:
 Reorganization items, net                          --         (1,339)
 Interest earned due to bankruptcy                  --             12
 Post bankruptcy-related professional
  fees                                              --              9
 Impairment of goodwill and other
  intangible assets                              1,196             --
 Restructuring and related items                   104             --
 Income tax benefit associated with
  intangible assets                               (119)            --
                                          -------------  -------------
 Total items excluded                            1,181         (1,318)
                                          -------------  -------------
 Net income excluding special items and
  reorganization related items              $      137     $      274
                                          =============  =============
 Basic and diluted weighted average shares
  outstanding                                    395.7
 Basic and diluted income per share
  excluding special and reorganization
  related items                             $     0.35
                                          =============


                                           (Successor)     (Combined)
                                              Three          Three
                                           Months Ended  Months Ended
                                          June 30, 2008  June 30, 2007
                                          -------------  -------------
 (in millions)
 Operating expense                          $    6,586     $    4,513
 Items excluded:
 Post bankruptcy-related professional fees          --             (9)
 Impairment of goodwill and other
  intangible assets                             (1,196)            --
 Restructuring and related items                  (104)            --
                                          -------------  -------------
 Total items excluded                           (1,300)            (9)
                                          -------------  -------------
 Operating expense excluding special items  $    5,286     $    4,504
                                          =============  =============


                                           (Successor)     (Combined)
                                              Three          Three
                                           Months Ended   Months Ended
                                          June 30, 2008  June 30, 2007
                                          -------------  -------------
 (in millions)
 Other expense                                 $    76        $   138
 Items excluded:
 Interest earned due to bankruptcy                  --            (12)
                                          -------------  -------------
 Total items excluded                               --            (12)
                                          -------------  -------------
 Other expense excluding interest earned
  due to bankruptcy                            $    76        $   126
                                          =============  =============


                                                         Five Months 
                                                            Ended
                                                         May 31, 2008
                                                        --------------

 PRASM                                                         11.63c
 Length of haul adjustment, including adjustments for 
  other airline revenue and certain other revenue               0.04
                                                        --------------
 Length of haul adjusted PRASM
  excluding other airline revenue and 
  certain other revenue                                        11.67c
                                                        ==============
 Industry average PRASM                                        11.44c
 Percentage of industry average                                  102%
                                                        ==============


                      (Successor) (Combined)  (Successor) (Combined)
                        Three       Three        Six         Six
                        Months      Months      Months      Months 
                        Ended       Ended       Ended       Ended
                       June 30,    June 30,    June 30,    June 30, 
                         2008        2007        2008        2007
                      ----------  ----------------------------------

 CASM                    17.00 c     11.84 c     23.54 c     11.71 c
 Items excluded:
 Aircraft maintenance 
  to third parties       (0.28)      (0.17)      (0.28)      (0.17)
 Staffing services to 
  third parties          (0.08)      (0.08)      (0.09)      (0.09)
                      ----------  ----------------------------------
 CASM excluding items 
  not related to 
  generation of a seat 
  mile                   16.64 c     11.59 c     23.17 c     11.45 c
 Items excluded:
 Impairment of 
  goodwill and other
  intangible assets      (3.09)         --       (9.75)         --
 Restructuring and 
  related items          (0.27)         --       (0.16)         --
 Profit sharing             --       (0.21)         --       (0.11)
 Post bankruptcy-
  related professional
  fees                      --       (0.02)         --       (0.01)
                      ----------  ----------------------------------
 Total items excluded    (3.36)      (0.23)      (9.91)      (0.12)
 CASM excluding 
  special items          13.28 c     11.36 c     13.26 c     11.33 c
 Fuel expense and 
  related taxes          (4.33)      (2.92)      (4.15)      (2.81)
                      ----------  ----------------------------------
 CASM excluding fuel 
  expense and related 
  taxes and special 
  items                   8.95 c      8.44 c      9.11 c      8.52 c
                      ==========  ==================================

 Mainline CASM           16.10 c     10.69 c     23.85 c     10.53 c
 Items excluded:
 Aircraft maintenance 
  to third parties       (0.33)      (0.18)      (0.33)      (0.22)
 Staffing services to 
  third parties          (0.10)      (0.10)      (0.10)      (0.10)
                      ----------  ----------------------------------
 Mainline CASM 
  excluding items not                   
  related to 
  generation of a seat                   
  mile                   15.67 c     10.41 c     23.42 c     10.21 c
 Items excluded:
 Impairment of 
  goodwill and other
  intangible assets      (3.63)         --      (11.55)         --
 Restructuring and 
  related items          (0.32)         --       (0.19)         --
 Profit sharing             --       (0.25)         --       (0.13)
 Post bankruptcy-
  related professional
  fees                      --       (0.03)         --       (0.01)
                      ----------  ----------------------------------
 Total items excluded    (3.95)      (0.28)     (11.74)      (0.14)
 Mainline CASM 
  excluding special 
  items                  11.72 c     10.13 c     11.68 c     10.07 c
 Fuel expense and 
  related taxes          (4.69)      (3.20)      (4.52)      (3.09)
                      ----------  ----------------------------------
 Mainline CASM 
  excluding fuel 
  expense and related 
  taxes and special
  items                   7.03 c      6.93 c      7.16 c      6.98 c
                      ==========  ==================================

 Note: c = cents

                                          FORECAST

                            September 2008        Full Year 2008
                          Quarter Projection        Projection
                          ------------------    ------------------

 GAAP operating margin 
  projection                          1 - 3%          (36) - (38)%
 Items excluded:
 Impairment of goodwill 
  and other intangible
  assets                                   -                   35%
 Restructuring and 
  related items                            -                    1%
                          ------------------    ------------------
 Operating margin 
  projection excluding 
  special items                        1 - 3%             0 - (2)%
                          ===================   ==================

                                          FORECAST
                          -------------------------------------------


                              September 2008        
                                 Quarter           Full Year 2008
                              Projected Range      Projected Range
                          --------------------- ---------------------

 Mainline CASM projection    12.12 c    11.99 c    17.92 c    17.99 c 
 Items excluded:
 Aircraft maintenance and 
  staffing services to 
  third parties              (0.39)     (0.39)     (0.42)     (0.42)
                          --------   --------   --------   --------
 Mainline CASM projection 
  excluding items not 
  related to generation 
  of a seat mile             11.73 c    11.60 c    17.50 c    17.57 c 
 Items excluded:
 Impairment of goodwill 
  and other intangible 
  assets                        --         --      (5.66)     (5.66)
 Restructuring and related 
  items                         --         --      (0.09)     (0.09)
                          --------   --------   --------   --------
 Total items excluded           --         --      (5.75)     (5.75)
                          --------   --------   --------   --------
 Mainline CASM projection 
  excluding special items    11.73 c    11.60 c    11.75 c    11.82 c 
 Fuel expense and related 
  taxes                      (5.23)     (5.23)     (4.95)     (4.95)
                          --------   --------   --------   --------
 Mainline CASM projection 
  excluding fuel expense 
  and related taxes and 
  special items               6.50 c     6.37 c     6.80 c     6.87 c 
                          ========   ========   ========   ========
 Change year over year in 
  Mainline CASM excluding 
  fuel expense and 
  related taxes and 
  special items                  0%        (2)%        0%         1%

 Note: c = cents


            

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