DELTA AIR CORPORATION 
  ANNUAL REPORT 
To Stockholders 
for the fiscal Year Ended June 30, 1944 
DELTA 
* 
AIR CORPORATION 
(A LOUISIANA CORPORATION) 
* 
* 
General Offices . . . . . . . . . . . . . . . .... Delta Air Lines Building 
Municipal Airport, Atlanta, Georgia 
Transfer Agent . . . . . . . . . . . . . . . Citizens & Southern National Bank 
Atlanta, Georgia 
Registrar . . . . . . . . . . . . . . . . . . . . . . . . . . Trust Company of Georgia 
Atlanta, Georgia 
 PAGE 2 
DELTA AIR CORPORATI ON 
* 
* 
DIRECTOR S 
M. 
s. BIEDENHARN L.B. JUDD 
C.H. McHENRY 
D. Y. SMITH 
C. E. w OOLMAN 
C.E.FAULK 
TRAVIS OLIVER 
OFFICERS 
C. E. FAULK, President 
C. E. WooLMAN, Vice-President and General Manager 
M. S. BIEDENHARN, Vice-President 
C. H. McHENRY, Secretary 
TRAVIS OLIVER, Treasurer 
L. B. JuDD, Assistant Secretary 
CATHERINE FITZGERALD, Assistant Treasurer 
* 
* 
 REPORT OF THE PRESIDENT TO THE 
STOCKHOLDERS 
Atlanta, Georgia 
October 16, 1944 
During the second full year of war your Company has 
been able to increase its commercial operations and to 
complete on or before schedule all the contract require- 
ments of the military in the Company's participation in the 
war effort. 
F I N A N C I A L R E P O R T 
* The fiscal condition 
of your Company is reflected by the Balance Sheet as of 
June 30, 1944, Summary of Income, Profit and Loss for 
the fiscal year ended June 30, 1944, and a Statement of 
Unappropriated Earned Surplus as of June 30, 1944, 
which form a part of this report. These statements reflect 
a net profit after Federal and State income taxes of $428,- 
605.86. This net profit represents an increase of approxi- 
mately $25,000 over the previous fiscal year. This increase 
was accomplished even after the reduction in your Com- 
pany's mail rate by a decision of the Civil Aeronautics 
Board in December, 1943, retroactively applied as of Feb- 
ruary, 1943. This reduction now places your Company on 
a service mail rate of .3 mill per pound mile. The net 
profit of $428,605.86 represents earnings of $2.16 per 
share of outstanding stock. 
Under the provisions of the Revenue Act of 1943 your 
Company was exempt from excess profits taxes for the fis- 
cal year ended June 30, 1944. 
The Equipment Replacement Fund established under the 
provisions of the Internal Revenue code as a result of the 
sale to the Government of four Lockheed Electra airplanes 
in June, 1942, deferring accounting for the profit thereon 
until replacement was accomplished, was cancelled during 
this fiscal year, and the net profit of $53,001.80, after 
payment of applicable Federal and State income taxes, 
was transferred to earned surplus. As a result of this ad- 
justment in the Federal income tax return for the fiscal 
year ended June 30, 1943, the Internal Revenue Depart- 
ment made formal examination of the Company's books 
for the fiscal years ended June 30, 1941, 1942, and 1943. 
No substantial additional income tax payments were re- 
quired other than those necessitated by the cancellation of 
the equipment replacement fund agreement. 
The unappropriated earned surplus of $423,410.85 as 
at June 30, 1943, was increased to $805,826.51 as of June 
30, 1944, after the payment of the customary annual divi- 
dend on June 10, 1944, of fifty ( $ .50) cents per share to 
stockholders of record on May 31, 1944. 
Y R A f F I C I N C R E A S E S 
* An upward trend in 
both passengers and cargo over the previous fiscal year is 
accentuated. With the addition of one Douglas DC-3 in 
August, 1943, and with more favorable utilization of all 
equipment, the available seat miles for the year were 
57,367,121 or an increase of 36.8 % over the previous 
fiscal year. With this percentage of increase of seats avail- 
able, passenger traffic was increased by  45.6% over the 
previous year, resulting in 51,843,940 passenger miles for 
the year. Mail ton miles increased from 449,841 for the 
fiscal year ended June 30, 1943, to 864,354 for the cur- 
rent year, a percentage increase of approximately 92 % . 
Considerable increase was experienced in express traffic, 
145,148 ton miles for 1944 as compared to 85,930 ton 
miles for 1943. These increases in traffic are particularly 
significant since the number of revenue miles flown for the 
year ended June 30, 1944, increased only 38.5 % over the 
number of revenue miles for the previous fiscal year. 
During the year the number of priority passengers and 
the amount of priority materials have increased consid- 
erably. These circumstances have been instrumental in 
the allotment towards the close of the fiscal year of two 
additional airplanes by the Army for reconversion to air- 
liners. These airplanes have since been converted and are 
now being utilized on the heavy priority segments of our 
routes. 
C O S T T R E N D S 
* The trends of per mile reve- 
nues and expenses are being given careful consideration, 
particularly with reference to post-war planning and post- 
war operations. 
PAGE3 
 COMPARATIVE PASSENGER, MA IL AND EXPRESS TRAFFIC STATISTICS 
Year Ended June 30, 
1944 1943 1942 1941 
Revenue Miles Flown . 2,771,832 2,000,385 2,968,284 2,476,569 
Passengers Per Revenue Mile . 18.7 17.8 10.0 6.3 
Passenger Seat Miles Flown . 57,367,121 41,940,889 50,993,835 36,091,177 
Revenue Passenger Miles . 51,843,940 35,613,103 29,800,968 15,526,291 
Passenger Load Factor 90.4% 84.9% 58.4% 43.0% 
Air Mail Ton Miles . 864,354 449,841 179,014 108,067 
Air Express Ton Miles . 145,148 85,930 36,543 16,489 
COMPARATIVE OPERATING REVENUES 
1944 
Passenger $2,577,138.84 
Mail . 517,370.99 
Express 65,507.32 
Other 73,308.52 
Total $3,233,325.67 
PASSENGER 79.71 % 
PAGE4 
Year Ended June 30, 
1943 1942 
$1,749,924.13 $1,318,912.95 
574,228.47 677,931.53 
51,278.05 24,019.01 
48,357.96 19,867.19 
$2,423,788.61 $2~040,730.68 
SALARIES & WELFARE 
51.48 % 
1941 
$ 683,498.95 
424,615.78 
9,161.45 
9,936.87 
$1,127,213.05 
1940 
1,790,706 
5.7 
19,477,148 
10,283,192 
52.8% 
75,080 
12,265 
1940 
$455,920.93 
424,449.36 
7,452.06 
6,097.42 
$893,919.77 
 REVENUES AND EXPENSES 
PER REVENUE MILE FLOWN 
Year Ended June 30, 
1944 1943 1942 1941 1940 
Operating Revenues 116.4c 120.Sc 
Operating Expenses 86.4c 89.0c 
68.6c 45.4c 49.9c 
59.7c 51.8c 46.2c 
E Q U I PM E N T 
* The fleet of airplanes and sched- 
ules remained constant during the year after the addition 
of one airplane in August, 1943. This made a total of five 
airplanes in operation during most of the fiscal year. Since 
the close of the fiscal year one additional airplane was put 
into operation in July and another in September. By effi- 
cient scheduling of the equipment a considerably higher 
utilization factor has been accomplished. After giving 
ample time for the usual thorough maintenance and over- 
haul comparable to Delta's high standard of quality, even 
under the fullest utilization schedules possible, a comple- 
tion factor of 94.1 % of scheduled miles was accomplished. 
The high load factors which have been accomplished 
during this year reflect the high weight utilization of the 
aircraft. 
SOURCE OF TOTAL INCOME 
OPERA TING REVENUES 98.12 % 
W A R W O R K 
* In support of the war effort your 
Company flew regularly scheduled cargo operations for 
the Air Transport Command, carrying vitally needed mate- 
rials as well as personnel over domestic routes designated 
by the Air Transport Command. Besides these regular 
daily scheduled flights many special missions to off-line 
points over the entire United States were performed for 
the emergency movement of materials. Training-plane en- 
gines and propellers were overhauled for the Air Service 
Command on a regular monthly scheduled quota. Each 
month the quota set up was exceeded and the allotted 
number of engines and propellers for the year was com- 
pleted in May, 1944. This contract with the Air Service 
Command was terminated by them in June, 1944. Your 
Company received a special letter of commendation from 
the Air Service Command for its efficient and economical 
operation of this activity upon the completion of the con- 
tract. Modification work on various Army planes was 
continued during the year until May 15, 1944, at which 
time the Materiel Command discontinu,ed the activity 
by termination of the contract. In order to continue the 
activity and utilize the facilities and trained personnel 
your Company contracted with the Navy Department to 
DISTRIBUTION Of TOTA~ INCOME 
OPERATING EXPENSES 71.33 % 
PAGES 
 continue performance of modification work immediately 
on Navy dive bombers. 
During the year a total amount of $942,259.98 was ex- 
pended on cost-plus-a-fixed-fee and fixed-price contracts in 
performance of the above services. The resulting profit 
from these contract operations was $36,226.49 or 3.84% 
of cost. This small margin of profit on Government con- 
tracts would indicate that the Price Adjustment Board will 
not have sufficient evidence for the recovery of any exces- 
sive profits. A conference has been held with the Price 
Adjustment Board but no definite clearance has yet been 
received. 
P E R S O N N E L 
* Employee problems have been 
met by continuous training programs in replacing those 
employees going into the armed services. As at June 30, 
1944, 187 men and women, classified as permanent em- 
ployees, had entered the armed services, and there are 
now six gold stars in Delta's Service Flag. During the year 
your Company had an average of 875 employees on its 
payroll of which one-third were women. The loyalty of 
Delta employees to the Company has alleviated the per- 
sonnel problem. 
PAGE6 
The benefits received from the Company's group insur- 
ance program, of which a majority of the employees take 
advantage, have eased the problems of many Delta em- 
ployees and their families at times of sickness or death. 
The Group Annuity, purchased entirely by the Company 
for retirement income, continues to be an attractive incen- 
tive during these times when personnel turnover is ex- 
cessive. 
E X P A N S I O N 
* Proceedings before the Civil Aero- 
nautics Board have been held during the year on several 
new route applications. Your Company's application for 
an extension of its present route from Birmingham, Ala- 
bama, to Oklahoma City, Oklahoma, through Memphis, 
Tennessee, Tulsa, Oklahoma, and several other interme- 
diate points was heard before an examiner of the Board 
in February, 1944. The examiner has recommended that 
Delta be granted the Birmingham-Memphis portion of this 
application. In April, 1944, the hearing on Delta's appli- 
cation for an extension of its present route from Shreve- 
port, Louisiana, to Kansas City, Missouri, and Tulsa, Okla- 
homa, via several intermediate points was held before an 
examiner. The examiner's recommendation is that Delta 
 Despite war problems, Delta has maintained its reputation for hos- 
pitality and efficient service at all times. Representative of Delta's 
passenger service is this group of new stewardesses. 
be awarded the extension from Shreveport, Louisiana, to 
Kansas City, Missouri, however the Tulsa extension was 
recommended to be denied. The Civil Aeronautics Board 
must yet take action on these recommendations of the ex- 
aminer before the decisions are final. 
Your Company's application in the Great Lakes to 
Florida case was presented before an examiner of the 
Board in June, 1944. These applications involve addi- 
tional route mileage sought by Delta from Chicago, Illi- 
nois, to Miami, Florida, from Chicago, Illinois, to Norfolk, 
Virginia, and Detroit, Michigan, and Cleveland, Ohio, to 
Miami, Florida. As yet no action has been taken since 
the hearing. Since the close of the fiscal year hearing on 
Delta's application from New Orleans, Louisiana, to San 
Juan, Puerto Rico, via Havana, Cuba, and other interme- 
diate points in the West Indies has been held before an 
examiner. 
The philosophy of Delta's expansion program as per- 
tains to new route applications is expressed elsewhere in 
this report. 
Very truly yours, 
PRINCIPLES GOVERNING 
DELTA'S ROUTE APPLICATIONS 
Before the war, as air line routes were extended, travelers 
showed an increasing tendency to use one system of service 
between destinations. As schedules will be speeded up 
through the use of improved post-war equipment this prac- 
tice will increase. The use of one system, one plane service 
saves time, avoids missed connections, and eliminates 
many other inconveniences. 
With the extension of through routes au travel will 
move largely on those carriers that serve major destina- 
tions. Such terminals will support the frequency of sched- 
ules which also will be one of the post-war travelers' 
requirements. 
Delta presently serves a group of exceptionally air- 
minded cities, but to retain their patronage it must extend 
its routes to the air terminals most visited by the travelers 
in these cities. Delta's new route applications have been 
made with a view to achieve three objectives: 
1. To give through service to the destination terminals 
of Southern travelers-New York, Cleveland, Detroit, 
Kansas City, New Orleans, and Miami. 
This scene, made at the Douglas Aircraft factory in Santa Monica, 
Calif., shows a Delta DC-3 undergoing complete rebuilding while 
being reconverted from military to airline use. 
PAGE7 
 2. To plot these routes by way of intermediate points of 
interest and importance to the South and to which 
directness and convenience of service can be improved. 
3. To establish an overall system service pattern that will 
contribute to the development of new uses for air trans- 
portation in the era of industrial expansion, which 
authorities in general are predicting for the South. 
It is this accelerated development of the South that 
makes it essential for Delta to expand, if it is to serve 
fully its cities and retain its relative position in the 
industry. 
\ 
j 
\ 
.. ")_ 
PA GE 8 
{ 
." 
) 
i" 
--..../ 
\ ... 
""-. 
( .. ,\ 
* * * * 
In the post-war period there will be an increase in the 
movement of products and goods by air. This traffic, too, 
will go to carriers that give major producing and distribut- 
ing centers direct routes to important marketing areas. 
Such considerations as these have governed Delta's ap- 
plications for routes which will enable it to contribute its 
part in  the creation of traffic and to serve completely a 
large part of the air transportation needs of the cities to 
which it is now certificated. Only in this manner can the 
hazards attending the dependence on connecting traffic 
be avoided. 
* * 
 DELTA AIR CORPORATION 
SUMMARY OF INCOME PROFIT AND LOSS 
YE AR ENDED JUNE 3 0, 1 9 4 4 
REVENUES 
Passenger . 
Mail . . . 
Express and Freight 
Excess Baggage . . 
Incidental Revenues 
TOTAL OPERATING REVENUES 
EXPENSES 
Flying Operations . . . . . . . . . 
Ground Operations . . . . . . . . 
Flight Equipment Maintenance- Direct 
Ground Equipment Maintenance-Direct 
Equipment Maintenance-In direct 
Passenger Service . . . . 
Traffic and Sales . . . . . 
Advertising and Publicity . 
General and Administrative 
Depreciation . . . . . . 
TOTAL OPERATING EXPENSES. 
NET OPERATING INCOME 
OTHER INCOME 
Cash Discounts . . . 
Interest Income . . . 
Net Profit on Government Contracts 
Additional Proration of Prior Year's Expense to Government Contracts . 
TOTAL INCOME . 
OTHER DEDUCTIONS 
Interest Expense . . . . . 
Net Loss- Dusting Division . 
Extension and Development Expense 
Reduction in Mail Revenue- Prior Year . 
Net Loss on Retirements of Operating Equipment . 
NET INCOME (Before Income Taxes) . 
INCOME TAXES 
Federal . 
Louisiana 
Other States 
NET ADDITION TO SURPLUS . 
. $2,577,138.84 
517,370.99 
65,507.32 
66,738.11 
6,570.41 
$3,233,325.67 
. $ 520,174.40 
534,875.32 
278,710.03 
19,253.47 
102,856.09 
208,595.55 
237,125.08 
79,652.35 
259,702.61 
154,591.41 
2,395,536.31 
$ 837,789.36 
.$ 2,432.36 
2,443.26 
36,226.49 
20,730.37 61,832.48 
$ 899,621.84 
. $ 3,011.12 
2,279.95 
24,789.64 
123,647.75 
3,454.87 157,183.33 
$ 742,438.51 
. $ 282,862.91 
17,889.57 
13,080.17 313,832.65 
$ 428,605.86 
PAGE9 
 ASSETS 
CURRENT ASSETS 
Cash Working Funds . . 
Cash in Banks . . . . . 
U. S. Government Securities at Cost . 
Accrued Interest on Above 
Accounts Receivable: 
U. S. Government: 
Mail and Transportation . . . . . . . . . 
War Contracts . . . . . . . . . . . . . 
Reimbursable Cosls and Expenses-Unbilled . 
Less Advances on War Contracts 
Traffic Balances . . . . . 
Trade Accounts . . . . . 
Estimated Express Revenue . 
Employees . . ... 
Agents (Employees) . . . 
Inventories-at Cost . . . . . 
TOTAL CURRENT ASSETS . 
OTHER ASSETS 
Stocks . 
Deposits-Travel Plan, Meter and Postage 
PROPERTY AND 
EQUIPMENT 
Airline 
Dusting Division 
Equipment in Process 
PREPAID EXPENSE 
Insurance 
Rentals 
Other . 
TOTAL ASSETS 
PAGE 10 
COST 
. $1,162,414.32 
68,467.71 
20,267.02 
$1,251,149.05 
. $315,685.79 
. 276,060.39 
31,371.86 
$623,118.04 
200,930.75 
DEPRECIATION 
$591,107.97 
34,761.95 
$625,869.92 
DELTA AIR CORPORATION 
(A Louisiana Corporation) 
BALANCE SHEET JUNE 30, 1944 
$ 3,270.00 
550,802.44 
$325,000.00 
494.80 
$422,187.29 
190,552.46 
31,119.77 
17,932.87 
9,210.38 
655.86 
$ 751.00 
580.83 
BOOK VALUE 
$571,306.35 
33,705.76 
20,267.02 
$625,279.13 
$ 24,363.07 
460.87 
3,915.10 
$ 554,072.44 
325,494.80 
671,658.63 
117,472.33 
$1,668,698.20 
1,331.83 
625,279.13 
28,739.04 
$2,324,048.20 
CURRENT LIABILITIES 
Accounts Payable: 
Traffic Balances . . 
Trade . . .... 
Employees . . .. 
Employees-Bond Deposits . 
Agents . . . . . . . . . . 
Taxes-Federal Transportation 
Taxes-Federal Withholding 
Taxes-Social Security . 
Ticket Refund Liability: 
Outstanding Drafts . . . . . . . . 
Refunds Payable . . . . . . . . . 
Transportation Purchased but Not Used 
Employees Benefit Fund . . . . . . 
Accrued Expenses: 
Federal and Slates-Income Taxes . 
Property Tax . .  . 
Social Security Taxes 
Salaries and Wages . 
Insurance . . . . . 
Auditing . . ... 
TOTAL CURRENT LIABILITIES . 
LIABILITIES 
. $128,770.15 
85,258.49 
1,151.57 
3,750.54 
1,545.06 
25,015.60 
17,876.33 
4,663.02 
. $ 11,116.57 
787.52 
. $313,895.85 
199.03 
16,490.18 
17,787.87 
5,864.05 
2,200.00 
NET WORTH 
CAPITAL STOCK 
Authorized-500,000 Sh. No par Common 
Outstanding- 197,424 Sh. New Stock } . . . . . . . 
Outstanding-240 Sh. Old Stock 
SURPLUS 
Earned Surplus 
TOTAL NET WORTH . . 
TOTAL LIABILITIES AND NET WORTH . 
$268,030.76 
11,904.09 
28,480.07 
2,629.79 
356,436.98 
$850,740.00 
805,826.51 
$ 667,481.69 
1,656,566.51 
$2,324,048.20 
PAGE 11 
 UNAPPROPRIATED EARNED SURPLUS 
JUNE 30, 1944 
Credit Balance, July 1, 1943 . . . . 
Transfer from Appropriated Surplus . 
Net Income for Year Ended 6-30-44 after Income Taxes . 
Less: 
Dividend of $ .50 per share paid 6-10-44 . 
Additional Federal Income Taxes for prior years . 
Net additional State Income Taxes for prior years 
. $99,192.00 
28,989.41 
1,084.43 
Credit Balance, June 30, 1944 . 
PA GE 12 
P. J . COX,P. A . 
H , C . PI\.AZEJ\. , C . P. A . 
COX AND FRAZER 
ACCOUNTANTS AND TAX CONSULTANTS 
OUACHITA NATIONAL. BANK lt,UILDlNC 
MONROE, LOUISIANA 
October 5. 1944 
Board of Directors and 
Stockholders, 
Delta Air Corporation, 
Atlanta, Georgia. 
Gentlemen: 
We have examined the Balance Sheet of Delta Air 
Corporation (a Louisiana Corporation) as at June 30, 
1944, and the Statement of Profit and Loss for the 
year ended on that date, have reviewed the system of 
internal control and the accounting procedures of 
the Company, and have made a detailed audit of the 
transactions. The examination was made in accordance 
with generally accepted auditing standards applicable 
in the circumstances and included all procedures 
deemed necessary. 
In our opinion, the accompanying Balance Sheet 
and Statement of Profit and Loss, with notes thereon, 
present fairly the position of the Delta Air 
Corporation at June 30, 1944, and the results of its 
operations for the year then ended in conformity with 
generally accepted accounting principles applied on a 
consistent basis throughout the period reviewed. 
Respectfully submitted, 
COX AND FRAZER 
$423,410.85 
83,075.64 
428,605.86 
$935,092.35 
129,265.84 
$805,826.51 
 I