Revenue passenger miles of 952 million were 23.7% above the preceding year, reflecting both the operation of DC-7s during the en- tire year and the inauguration of daylight coach service in December, 1954. Reduced fare aircoach passenger miles represented 24.7% of the total, an increase of 70.7%. ~ Six additional Golden Crown DC-7s were - received and placed in service during the year, permitting the extension of this luxury service to 15 cities. Firm orders have been placed for five DC-7s, one scheduled for de- livery in the latter part of 1955 and the other four in mid-1957. The Company also has an option to purchase six more DC-7s for deliv- ery in the winter of 1957-58. ... Debentures aggregating $5,000,000 were - called for redemption during the year. $2,858,000 were redeemed for cash and the balance were converted into common stock at the established price of $35 a share. ~ Net earnings from operations of Sl,907,000 - were 3.2% of operating revenues of $59,188,000. Total earnings of $2,166,000 (in- cluding flight equipment sale profits of S259,000) equalled $3.61 per share on the average number of shares of stock out- standing during the year, and $3.27 a share on the 661,9 l 3 shares outstanding after giv- ing effect to the conversion of debentures in July, 1955. OF THE YEAR ENDED JUNE 30, 1955 Four quarterly dividends of 30 each were paid to common stockholders, thereby con- tinuing one of the better dividend records in the industry. Total common stockholder equity increased by $3,613,000 to $19,846,000 at June 30, 1955, with each of the 661,913 shares. having a book value of $29.98 - $2.92 above the be- ginning of the year after payment of $1.20 a share in dividends. .... The effect of the U. S. Supreme Court de- - cision of February 1, 1954 in the C&S "Off- Set" mail rate case cannot yet be determined with respect to either the Company's possi- ble liability for past periods of C&S opera- tions or the availability of governmental subsidy support for its international routes since May 1, 1953. .... Hearings before a CAB Examiner were con- - eluded in December, 1954 in the "Additional Southwest-Northeast Service Case". Involved in this case is your Company's application to serve the New York-Washington area from the South and Southwest, which would pro- vide a measure of the equality of competitive opportunity essential to maintaining its po- sition among the economically self-sufficient airlines of the Nation in the years ahead. ~ The number of employees increased by 290 - during the year, to 4,547 at June 30, 1955. Delta Air Lines, Inc. annual report 1955 TO THE STOCKHOLDERS The year ended June 30, 1955 was the second full year of merged Delta-C&S operations, which produced net earnings after taxes of $1,907,175, equal to 3.2% of operating revenues of $59,187,- 961. Profits of $258,850 after taxes were realized from sales of flight equipment, bringing total earnings to $2,166,025, equivalent to $3.27 a share on each of the 661, 913 shares of stock re- corded as outstanding on June 30, 1955 (after giving effect to 57,700 shares issued in July, 1955 for conversions of debentures called for redemp- tion July 25, 1955). Financial Results REVENUES-Operating revenues for the year were $59,187,961, 17.59% abov_e the preceding year. Passenger revenues of $53,966,525 were 91.18% of the total, and were 19.54% higher than the preceding year. This increase in pas- senger revenue was accompanied by a 23.75% increase in revenue passenger miles, with the higher proportion of aircoach passenger miles to the total (24.66%) resulting in a decline in the average yield per passenger mile to 5.67 from 5.87 the preceding year. Excess baggage revenues followed the trend of passenger reve- nues and increased to $765,580 from $602,579 the preceding year. U. S. Air Mail revenues of $1,403,082 repre- sented 2.37% of total operating revenues and were 17.39% below the preceding year. This decline in mail revenues is attributable to a lower net yield under the revised service mail rate formula for the domestic carriers finalized during the year effective April 1, 1954 (discussed in more detail under "Mail Rates") and to a slight drop (2.11 %) in air mail ton miles from 3.23 million to 3.16 million. Revenues of $59,602 were earned from the carriage of first class mail by air on a non- priority basis between Chicago and Florida points, at an interim rate of 20.04 per ton mile. This project is still in the experimental stage, and your Company is cooperating to the fullest extent possible with the hope that it will eventually lead to air transportation of all first class mail moving significant distances. Pro- cedural steps before the CAB looking toward permanency have been halted pending judicial decision of whether the Post Office Department has authority under existing statutes to arrange for the movement of first class mail by air. Revenues from the carriage of air express in- creased 8.66%, from $844,483 to $917,609. Air- line revenues from this source represent a per- centage of the gross revenues received by the Railway Express Agency, after deduction of cer- tain specified handling expenses incurred by REA; this formula resulted in a net yield of 36.69 per ton mile, up slightly over the preced- ing year. Air freight revenues increased slightly, from $1,766,266 to $1,844,168, with a slight de- crease in ton miles carried (from 7.17 million to 6.98 million) and a slight increase in the ton mile yield to 26.41. Total revenues for the year from air express and air freight of $2,761,777 made a significant contribution to net earnings. The three remaining Constellation aircraft and certain spares were leased to Pacific North- ern Airlines, Inc. (a certificated Alaskan car- rier) in April, 1955 for one year. Gross revenues of $238,909 were received from this lease in the last quarter of the fiscal year, against which was charged an equivalent amount of expenses com- posed of depreciation, amortization of the prop- erty acquisition adjustment account balance 2 applicable to the leased equipment, and some minor leasing costs. The average net yield per ton mile of system revenue traffic declined to 56.4 I from 57 .69 the preceding year. Gross revenues for the year were $1,344,000 less than would have been de- veloped for the same volume of traffic by the preceding year's net yield. This lowering of the product cost to the user undoubtedly expands the public benefits of air transportation; it also makes even more important to individual car- riers their access to high-density markets for the traffic volume necessary to support lowered fare levels of increasingly broader application. EXPENSES-Operating expenses of $53,492,032 were 10.76% above the preceding year. An ac- companying increase of 12.72% in available ton miles resulted in a cost per available ton mile of 29.23, slightly below the 29.75 for the pre- ceding year. Direct flying expenses increased $3,622,465 (up 14.31 %), attributable primarily to the high- er costs for maintenance and depreciation of the new and larger flight equipment placed in service. Ground and indirect expenses increased $1,573,256 (up 6.85%), and represented 46% of total operating costs. The available ton mile costs for Delta Air Lines, Inc. for the last six years are shown be- low, reflecting the extent to which higher cost levels have not been overcome by increased ef- ficiencies and (to a lesser degree) the somewhat higher cost characteristics of the C&S system: Year Ending June 30th 1950 1951 1952 1953 1954 1955 Cost Per Available Ton Mile 26.50 26.24 28.27 30.73 29.75 29.23 DIVIDENDS-Four quarterly dividends of 30 each were declared during the year, aggregating $720,309, payable on September 6, 1954, De- cember 6, 1954, March 7, 1955 and June 6, 1955. This is the seventh consecutive year in which cash dividends have been paid and the payment Some of the 51 spare engines necessary to back up the 140 active power plants in the fleet of 53 planes. of the June 6, 1955 dividend was the 18th con- secutive quarterly dividend. Financing-Capitalization BANK CREDIT AGREEMENT - On Sep- tember 2, 1952 your Company entered into a Credit Agreement with a group of twenty-five banks under which $20,000,000 could be bor- rowed from time to time on unsecured notes bearing a 3% interest rate repayable in six- teen equal quarterly installments commencing fifteen months after the date of each loan. At the beginning of the fiscal year $14,000,000 had been borrowed under this Agreement, and dur- ing the year the remaining $6,000,000 was bor- rowed to apply upon the purchase of the six DC-7 aircraft received during the year. At June 30, 1955 $2,300,000 had been repaid, leaving $17,700,000 outstanding - $3,875,000 due within one year from that date and the balance of $13,825,000 due at later dates. The repayment schedule calls for payments as follows: Fiscal Years Ended June 30 1956 1957 1958 1959 1960 Amount $3,875,000 5,000,000 4,850,000 2,850,000 1,125,000 This Credit Agreement provides that no cash dividends on common stock shall be paid which would reduce earned surplus below $3,700,000, and that a working capital balance of not less than $1,500,000 must be maintained. The bal- ances of both items at June 30, 1955 were well above the specified amounts. DEBENTURES - At the beginning of the fis- cal year there were outstanding $10,858,546 of the 5% convertible debentures authorized in connection with the merger of Chicago and Southern Air Lines, Inc. with and into Delta on May 1, 1953. During the year $54 principal amount of debentures were sold for cash and $42,000 principal amount were issued to a f~rmer _officer of C&S under options held by him pnor to the merger. During the year $5,000,000 principal amount of debentures were called for redemption, $2,500,000 as of February 21, 1955 and $2,500,000 as of July 25, 1955. These calls resulted in cash redemptions of $2,- 858,000, with the balance of $2,142,000 being converted into common stock at the established rate of one share of common stock for each $35 Sources ol the 1955 Revenue Dollar face value of debentures. In addition, $33,400 of uncalleq debentures were converted into common stock. As a result of these transactions, outstanding debentures recorded at June 30, 1955 were $5,867,200 (after giving effect to the call as of July 25, 1955 made pursuant to action of the Board of Directors on June 14, 1955), down $4,991,346 from the beginning of the year. On July 28, 1955 the Board of Directors voted to call for redemption an additional $3,000,000 principal amount of these debentures, and Sep- tember 9, 1955 has been fixed as the redemption date. It is anticipated that a substantial portion of those called will be converted into common stock, but the division between conversions and redemptior:is cannot now be forecast. Consum- mation of this call will reduce the outstanding debentures to approximately $2,500,000, with another $42,000 reserved for outstanding options held by a former officer of C&S. STOCKHOLDER EQUITY - As a result of debenture conversions, the number of shares of outstanding common stock increased from 600,- 000 at June 30, 1954 to 661,913 shares at June 'ooo OMITTED"' PASSENGER & EXCESS BAGGAGE $54,732 1,474 2.762 582 91.91 % 2.47 % 4.64 % .98 % 3 4 30, 1955, including the shares issued in connec- tion with the debentures called for redemption on July 25, 1955. The stockholder equity re- corded at June 30, 1955 was $19,845,898, equiva- lent to $29.98 per share of outstanding stock. Complete conversion of the $5,867,200 out- standing debentures at June 30, 1955 would re- quire the issuance of approximately 167,000 shares of common stock. Such complete con- version would result in there then being out- standing 829,000 shares of common stock, each having a book value of $31.00. Mail Rates DOMESTIC - From October 1, 1951 to Jan- uary 1, 1954 your Company received service mail pay at the rate of 53 per ton mile, the compensatory rate established for it and five other carriers by the CAB; under this group rate structure, a compensatory rate of 45 per ton mile was established for the "Big Four" (in recognition of the characteristics of their route structures which permitted lower operating costs) and rates higher than 53 a ton mile for the balance of the industry. In late 1953 the Post Office Department registered its objection to these varying service rates, which resulted in some instances in the Department paying differ- ent amounts of service mail pay for the same service. Accordingly, the Civil Aeronautics Board prescribed for Delta and the other car- riers in its group a rate of 45 per ton mile for mail carried over segments where one or more carriers of the "Big Four" also provided the service, and a slightly higher rate over the re- mainder of its system, effective January 1, J954; this combination of rates produced an average yield of approximately 51 per ton mile. The Civil Aeronautics Board then opened the service mail rates of all the domestic trunk lines for redetermination effective April 1, 1954. After extensive conferences involving the air- lines, the CAB, and the Post Office Department, agreement was reached on a new "Multi- Element" mail rate formula for the domestic carriers which eliminates any differential in rates between carriers and provides for payment of the same service mail pay for the performance of the same service. This multi-element formu- la, which contains one rate for terminal han- dling and one rate for line-haul transportation of air mail, resulted in a $5.5 million reduction in annual service mail pay for the industry. The application of this formula is estimated to develop a net return of approximately 44.7 per ton mile for your Company, effective April 1, 1954; domestic mail revenues for the fiscal year ended June 30, 1955 have been recorded at this new, lower rate. INTERNATIONAL- Mail revenues for the international division have been recorded at service rates only since May 1, 1953. Although C&S received mail pay subsidy support for this division prior to the merger, and operations of the international division since the merger have been conducted at a loss in the absence of such governmental support, the U.S. Supreme Court decision in the "Off-Set Case" discussed below has precluded the receipt of mail pay subsidy Booming Caracas, Venezuela was the destination of the world's first inter-continental DC-7 service in April 1955. since the merger. Service mail pay for this operation (reduced from 88 to 65 a ton mile effective April 8, I 954) aggregated $49,056 for the year ended June 30, 1955, 1.2% of the total revenues of that division. OFF-SET ISSUE - In 1952 the Post Office De- partment filed a petition requiring judicial re- view of a CAB Rate Order of October, 1951 establishing international subsidy mail pay rates for C&S, contending that the CAB erred in re- fusing to take into consideration certain profits earned on the C&S domestic operations in de- termining the mail pay requirements of its in- ternational operations. The determination of mail pay requirements on a divisional basis for a carrier operating more than one division had been followed by the CAB since the passage of the Civil Aeronautics Act in I 938, and this policy had not theretofore been challenged. In May, I 953 the Circuit Court of Appeals of the District of Columbia r~led in favor of the Post Office Department, and this ruling was upheld by the U. S. Supreme Court in a decision issued February 1, 1954. This decision requires the CAB to redeter- mine the mail pay requirements of the C&S system for certain periods prior to the merger in accordance with the principle that the entire operations of the carrier must be considered. Initial procedural steps looking toward this redetermination were begun shortly after the close of the fiscal year. We will endeavor to sustain our position that the "need" of C&S for the periods involved does not warrant any recapture of mail payments by the Post Office Department, but it is impossible to forecast the amount of refund; if any, that may be ulti- mately required. Legislation was introduced in the 84th Con- gress which, if adopted, would re-establish the divisional rate-making principle followed by the CAB prior to the Supreme Court decision with respect to all pending rate matters. Services GOLDEN CROWN DC-7s - Our Golden Crown DC-7 aircraft played a major role in the increased use of our services by the traveling public. The six DC-7s ordered in 1953 were delivered during the year, bringing the total to ten, and they have been placed in service on all major route segments (serving 15 cities over the system). On April 1, 1955 we inaugurated the world's first intercontinental DC-7 service with daily flights between New Orleans, Lou- isiana and Caracas, Venezuela via Ha van a, Cuba and Montego Bay, Jamaica. This 69-passenger airplane with a cruising speed of 365 miles per hour and such added features for passenger comfort as built-in air conditioning is the finest piston-engine aircraft in operation today, and it ushered in a new era of air transportation. 5 6 Delta pioneered portable X-ray equipment for inspec- tion of inaccessible places, such as inside of a DC-7 wing. DC-7 aircraft produced 365.2 million seat miles during the year (24.06% of the total) and carried 245.6 million revenue passenger miles (25.79% of the total). Your Company first in- augurated service with this equipment in April, 1954, a full fifteen months ahead of its princi- pal competitor. The impact of increased com- petition can be anticipated in the future, how- ever, as additional DC-7 units are placed in service by other carriers. AIRCOACH - Your company deferred the in- auguration of daylight aircoach service because the size of its fleet did not permit the conversion of a portion to the high-density seating con- figuration required for this service by CAB regulations. Receipt_ of DC-7 aircraft during the year made it possible to convert our DC-6s to the required seating density, and daylight air- coach service was begun in December, 1954 in keeping with our policy of giving the areas served by us the maximum possible benefits of air transportation - both in quality of the product and the prices charged for that product. During the year we also continued, and broad- ened where possible, the comprehensive network of night aircoach service now provided 16 cities. A total of 339 million available seat miles of aircoach service were operated during the year (an increase of 53.32% over the preceding year), and aircoach services accounted for 97.3 million (53.23%) of the 182.8 million increase in total revenue passenger miles over the preceding year. INTERCHANGES-Your Company, which pioneered post-war equipment interchanges, is still one of the foremost part1opants in those operations that bring to the public the advan- tages of through-plane service without imposing upon the industry the burden of route dupli- cations which in some instances are not eco- nomically justifiable. The equipment interchange operations in which we participate are detailed below: a) With TWA (begun in 1948) through- plane service (two daily round trips) be- tween Detroit and points on Delta's routes south of Cincinnati, with Cincinnati as the interchange point. b) With American (begun in 1949) through- plane service between Atlanta and Cali- fornia, with Dallas/Fort Worth as the interchange point. Three round trips a day are operated under this agreement, including Golden Crown DC-7 service. c) With American and National (begun in 1951) through-plane service between Mi- ami and California, with New Orleans and Dallas/ Fort Worth as the interchange points. Three round trips a day are op- erated under this agreement, including Golden Crown DC-7 service and DC-6 daylight aircoach. d) With TWA (begun in 1953) through- plane service (one daily round trip) be- tween New York and Houston, with In- diana polis as the interchange point. Equipment and Facilities FLIGHT EQUIPMENT-Acquisitions of flight equipment (including spares and parts) totaled $12,076,532 during the year, covering primarily six DC-7 aircraft. At the end of the year our aircraft fleet consisted of ten Golden Crown DC-7s, seven DC-6s, twenty Super Con- vair 340s, fourteen DC-3s, and two DC-3 all- cargo planes. These 53 aircraft and related spares and parts are reflected in the balance sheet at an original cost of $48,409,359, against which a depreciation reserve of $17,848,914 (36.87%) had been accrued at that date. Orders have been placed for five more DC-7s having a productive capacity of 350 million seat miles annually, one for delivery in December, 1955 and the remaining four in mid-1957. These aircraft and necessary spares will cost an esti- mated $1'0,500,000. We also have placed an order for six additional DC-7 type aircraft to be delivered in the 1957-1958 winter, subject to cancellation at nominal cost prior to a speci- fied future date. Receipt of these aircraft on order, together with increased utilization of the existing fleet, will provide additional capacity until such time as turbine powered aircraft become established in the domestic airline picture, which from present indications will occur in 1959 or 1960. We are following with close interest the de- velopment of turboprop and turbojet aircraft potentially suitable for our operations. The initial installation of airborne radar equipment for avoidance of turbulence in flight will be completed in the next few months, and it is anticipated that all our four-engined air- craft will be similarly equipped as promptly as possible thereafter. GROUND EQUIPMENT AND FACILITIES- Acquisitions of ground facilities and equip- ment totaled $442,827 during the year, reflect- ing modernizations of various airport and city ticket offices over the system and additional equipment required by new aircraft and the expanded volume of services. Firm plans have been made for increased maintenance and office facilities at the Atlanta base, to be constructed on land under long- term lease. New maintenance facilities are also planned for Miami and Dallas, to be constructed with funds furnished by lessor agencies. Sales-Advertising Sales activities during the year were directed primarily to popularizing the expanded Golden Crown DC-7 services and the additional air- coach services. Arrangements were completed with banks in all major cities for a "Fly Now - Pay Later" plan. Under this arrangement transportation and related expenses may be purchased on credit, with the Company handling the sales and contact functions and the banks providing credit without recourse to the Company. The total volume of sales made under this program has been relatively small to date, but it has de- veloped business not otherwise obtainable. Your Company's advertising program received significant recognition by winning the coveted "Socrates" award. This award is given annually by Transportation Ad Views for the best news- paper advertising program covering all fields of transportation. Expenditures for advertising and promotional purposes totaled $1,592,243 for the year. Al- though these dollar expenditures increased slightly over the preceding year, the percentage of commercial revenues expended therefor de- creased to 2.76% from 3.24%. General offices and maintenance headquarters on Atlanta airport. Larger hangar (A) is now being extended and 25,000 sq. ft. (B) added to engine overhaul. ,,,,,...__--------...... ,, ......... 8 As many as 31 separate pieces of ground equipment and 21 employees are required to service the average four- Safety and Dependability June 30, 1955 marked the completion of another year of operation without fatality or serious in- jury to passengers or flight crew members. Your Company is proud of its contribution to the safety record of this country's certificated car- riers, which reached a new high. Continuing improvements in air navigational facilities and the general dependability of the new aircraft placed in service permitted the completion of 98.79% of scheduled mileage, up from 98.29% the preceding year. Personnel The total number of employees at June 30, 1955 was 4,547, an increase of 290 (6.8%) dur- ing tl).e year. It is gratifying to realize that our operations created these additional job oppor- tunities, with the accompanying increase in em- ployee earnings contributing to the economic health of the communities that we serve. A general wag~ and salary increase was placed into effect in November, 1954, in keeping with the industry and nationwide trend. The em- ployee retirement income plan begun in 1942 was once again modernized effective January 1, 1955 to provide benefits under the non-con- engine Deltaliner at a major terminal. DC-7's have full- time air conditioning, do not need cooler truck shown. tributory portion of the plan on the first $4200 of an employee's annual earnings (previously $3600), in order to maintain complete integra- tion with the Federal Government's Social Se- curity program. Your Company also continued its liberal program of free and reduced rate transportation for employees and their families, its sponsorship of an Employees' Credit Union (with total assets of $860,000) and numerous other recreational and educational projects. At June 30, 1955 employees with more than five years of service numbered 2,067 (46% of the total), and 638 had more than ten years of service. This situation is most encouraging, pro- viding as it does the nucleus of skilled and ex- perienced employees upon which to build for the future. Route Extensions and Modifications The "Additional Southwest - Northeast Service Case" remains for us the most important pend- ing route case. The map on Pages 10 and 11 of this report sets forth the route extensions sought therein, designed to provide new and competi- tive air service between the South and South- west and the New York - Washington area, requiring primarily an extension of existing routes northeastward from Atlanta. On August 29, 1955 the Examiner issued his initial decision which did not recommend our requested route extensions. The only further procedural steps before final decision are the filing of briefs to the CAB and oral arguments before the CAB. The expeditious manner in which the CAB is processing route cases makes possible a final decision by the end of 1955 and quite probable that it will be issued before March 31, 1956. Hearings are presently being conducted in the "New York - Florida Proceeding", in which sev- eral carriers (including your Company) seek to provide additional air service along the East Coast. The specific authority sought by us in this case is also shown on the map on Pages 10 and 11. Final disposition of this case cannot be expected before mid-1956. We have filed with the CAB numerous other applications to provide additional -service, but none of these have progressed to the hearing stage. On August 1, 1955 the CAB denied our re- quest that Fort Wayne, Indiana be designated as the junction point for Routes 8 and 54, which, if approved, would have permitted through-plane service between Detroit and points south of Fort Wayne on Route 54. Our Merger Agreement of October, 1950 with Northeast Airlines, which required a route con- nection between the systems of the two com- Personnel by Length ol Service AS OF JUNE 30. 1953,1954 AND 1955 OVER 20 YEARS panies, was cancelled by Northeast Airlines dur- ing the year. Future Outlook The results of your Company's application to serve the Washington - New York area from Atlanta will have a significant effect upon its future. Receipt of this requested route would give us a measure of that equality of competitive opportunity so vital to the sound growth and development of one of the Nation's major as- sets - a vigorous commercial air transportation system financially independent of subsidies. Certainly a favorable economic climate exists for the CAB to make such route awards and adjustments as are necessary to achieve that ob- jective. The revenue passenger miles carried by the domestic trunk lines in 1954 of 16.2 billion represent an increase of 14 7 % in five years. Economists predict that the volume of air travel in 1960 will be almost triple that of 1950. \!Ve are hopeful that our past record of service, and the service which we could provide, will earn for us primary consideration by the Civil Aeronautics Board. President and General Manager September 12, 1955 9 10 Della seeks access to During the past year your Company has devoted major efforts to the prosecution of the two most important route applications in its history. In both Delta seeks access to the nation's primary travel market - Washington and New York. In the Southwest-Northeast Case, now awaiting decision following lengthy hearings during the fall of I 954, Delta has applied for a 774-mile extension from Atlanta to ~harlotte, Washington, Baltimore, Philadelphia and New York. We are also seeking in this proceeding to close the gaps in our present system between Birmingham-Memphis and between New Orleans-Houston. In the New York-Florida Case, in which hearings opened June 6, 1955, we have filed application for a Miami-New York-Boston route. We already serve one-third of this 1284-mile segment - from Miami to Jacksonville and up through Brunswick, Savannah and Augusta to Columbia. We seek an extension of our present route 54 from Columbia northward to Charlotte, Fayetteville, Greensboro/ High Point/ Winston-Salem, Norfolk, Washington, Baltimore, Philadelphia, New York and Boston. As a part of the same appli- cation, we request the addition of Tampa/ St. Petersburg as an alternate stop on route 54 between Jacksonville and Miami. Access to Main Street America - the business, financial and government centers of the Northeast - constitutes the Company's greatest need. This is the market to \Vhich we must have access if we are to attain economic stability and equality of competitive opportunity. Delta alone among the major carriers operating east of the Mississippi is still denied entry to New York-\,Vashington, the area that accounts for approximately 45 per cent of all the nation's air passengers. No efficiencies which we can achieve in our operations, no skills which management can apply in the direction of your Company, can compensate for the lack of access to the country's prime traffic generating area. Delta is seriously handicapped because it is not permitted to carry its passengers in the South and Southwest all the way to their principal destinations - Washington and New York. During the past two decades the South and Southwest have undergone an amazing economic expansion. Yet despite its dramatic progress this region is still denied the benefits of that effective airline competition enjoyed by other important areas of the United States. Delta, as a Southern airline with a well-developed route system in the South, is the logical carrier to fill this glaring gap in the air pattern of the nation. Your Company's readiness, willingness, and ability to meet this pressing need has been convincingly documented to the Civil Aeronautics Board. An award to Delta in this case will not only strengthen the Company and enable it to continue to operate free of subsidy, but also serve the public interest. The public need is equally paramount in the New York-Florida Case, which involves third ~arrier competition between Miami and New York, a~ well as essential new and additional service to intermediate cities between Miami and Boston. Florida's growth justifies added air service. Between 1948 and 1954, the state's air traffic increased 3.3 times, compared to 1.4 for the U. S. as a whole. This growth continues. If there is justification for competition by three carriers anywhere in the world, it exists between Florida and the Northeast. During JO years operation in the highly competitive Chicago-Miami market, Delta - which pioneered the airline summer package vacation in 1947 - has demonstrated its ability to sell air travel to Florida. An award to Delta in this case will provide an additional experienced Florida sales- man in the dense Northeast market. _4 ELPHIA WILM TON , BALTIM, CI N NAT I . ~ WASHINGTO~~(' # \\ \\ TNEWS # ~,1) OLk ~~ l ## ~ . ~~ ~~ I N S T O N - S A L M 1 L , . \\ G R E E N S B O R O !' " I G H P' 0 I N T AR LOTT EA- .,, . /JI/ VILLE.....__ ~:::-~,\ 1/ ~;iVIL~~ FAY E,TTE ILL NVILLE A.NBURG ~N~-'!'---""'~~ MB I A ------" RLESTON ANNAH SWICK ONVILLII; SEA AT ANTIC CEAN LEGEND - Delta Present Airline Routes THROUGH PLANE SERVICE WITH American Airlines CU:::::ICI National Airlines ~TWA PROPOSED NEW SERVICES Southwest-Northeast Case New York - Florida Proceeding VI GIN 12 assets CURRENT ASSETS: Cash . . . . . . Securities, at cost which approximates market- U.S. Government securities . . . . . . Federal Land Bank and Home Loan Bonds Accounts receivable- Traffic (net) . . . . . . . . . . . Other . . . . . . . . . . . . . . . . Maintenance and operating supplies, at average cost Other current assets . . . . . . . . . . . Total current assets OTHER ASSETS: Advance payments for new flight equipment Net assets of dusting division . . . . . Miscellaneous . . . . . . . . . . . OPERATING PROPER TY AND EQUIPMENT (Including $3,912,188 and $3,974,097 fully depreciated in 1955 and 1954, respectively): Cost- Flight Equipment 1955 . . . . . . $48,409,359 1954 . . . . . . 37,154,570 Reserve for depreciation- 1955 17,848,912 1954 . . . . . . 12,550,282 Other Property and Equipment $6,238,399 6,028,542 3,158,139 2,852,358 PROPERTY ACQUISITION ADJUSTMENT (Note 3) DEFERRED CHARGES: Unamortized DC-7 preinaugural expense Advances for leased facilities, being amortized Other deferred charges . . . . . . . . , ,'DELTA AIR LINES. INC. ATLANTA, G EORGIA BALANCE SHEETS-JUNq 30 , 1955 AND 1954 liabllltles 1955 $ 5,855,019 6,990,197 3,752,160 1,179,069 534,792 451,459 $18,762,696 $ 136,317 261,869 $ 398,186 $54,647,758 21,007,051 $33,640,707 $ 734,391 $ 111,546 83,431 318,925 $ 513,902 $54,049,882 1954 $ 6,403,316 3,298,683 1,002,293 2;985,946 1,199,421 720,255 278,632 $15,888,546 $ 2,587,200 149,049 118,189 $ 2,854,438 $43,183,112 15,402,640 $27,780,472 $ 993,591 $ 222,037 104,886 246,027 $ 572,950 $48,089,997 CURRENT LIABILITIES: Current maturities of notes payable Accounts payable and accrued liabilities . Advance sales of tickets for transportation Accrued Federal and state taxes on income Air travel plan deposits Total current liabilities 3% NOTES PAYABLE TO BANKS due in installments to 1960 (less current maturities above) 5% CONVERTIBLE DEBENTURES (SUBORDINATED) due May 1, 1973 (convertible into common stock at $35.00 per share), reflecting in 1955 the retirement of $2,500,000 of Debentures called on June 24, 1955 for redemption as of July 25, 1955 (Note 4) . . . . . . . . . . RESERVES AND DEFERRED CREDITS: Deferred Federal income taxes (Note I) Reserve for aircraft overhaul Other . . . . . . . . . . . .. . CAPITAL STOCK AND SURPLUS: Common stock, par value $3.00 per share, Authorized 1,500,000 shares, of which 169,080 shares are reserved for conversion of Debentures Issued and outstanding 600,000 shares at June 30, 1954 and 661,913 shares at June 30, 1955 including 57,700 shares issued after June 30 in conversion of Debentures called for redemption on July 25, 1955 . . . . . . Capital surplus . . . . . . . . . . . . . . . . Earned surplus (of which $3,700,000 is not available for cash dividends under terms of credit agreement and indenture) . PURCHASE COMMITMENTS AND CONTINGENT LIABILITY (Note 2) The accompanying notes are an integral part of these statements. 1955 $ 3,875,000 4,692,190 1,746,498 1,695,731 677,025 $12,686,444 $13,825,000 $ 5,867,200 $ 1,325,000 372,211 128,129 $ 1,825,340 $ 1,985,739 7,653,652 10,206,507 $19,845,898 $54,049,882 1954 $ 2,150,000 4,441,961 1,020,156 662,919 586,075 $ 8,861,111 $11,700,000 $10,858,546 $ 335,000 102,113 $ 437,113 $ 1,800,000 5,672,436 8,760,791 $16,233,227 $48,089,997 13 14 ARTHUR ANDERSEN & Co. statements ol income f:OR THE YEARs ENDED JUNE 3o, 1955 AND 1954 ACCOUNTANTS AND AUDITORS OPERATING REVENUES: Passenger U.S. Mail Freight . Express . Excess baggage Other operating revenue-net Total operating revenues OPERATING EXPE SES: Flying operations Direct maintenance-flight equipment Depreciation-flight equipment Total direct aircraft operating expenses Ground operations Ground and indirect maintenance Passenger service Traffic and sales . Advertising and publicity General and administrative Depreciation-ground equipment Total operating expenses Income from operations before income taxes OTHER EXPENSE (INCOME): Interest on notes payable . Interest on debentures . . . . . . Amortization of property acquisition adjustment (Note 3) Net profit of dusting division . . . . . . . . . . Other- net Total other expense (income) Income before income taxes PROVISION FOR TAXES ON INCOME: Federal and state taxes on income, including deferred taxes 1955 $53,966,525 1,462,684 1,844,168 917,609 765,580 231,395 $59,187,961 $15,655,414 7,280,827 6,004,905 $28,941,146 6,865,012 3,718,398 3,573,237 5,500,221 1,592,243 2,861,699 440,076 $53,492,032 $ 5,695,929 $ 563,444 547,140 199,290 (4,269) 71,149 $ 1,376,754 $ 4,319,175 of 990,000 in 1955 and 335,000 in 1954 (Note 1) 2,412,000 Net income $ 1,907,175 SPECI~L IT~M-Profit on disposition of flight equipment (less a pphcable mcome taxes of 103,000 in 1955 and $407 000 in 1954) ' Net income and special item 258,850 $ 2,166,025 1954 $45,144-,949 1,723,703 1,766,266 844,483 602,579 251,902 $50,333,882 $15,229,008 5,210,545 4,879,128 $25,3 18,681 6,591,262 3,41 0,455 3,375,200 4,871,386 1,574,364 2,758,939 396,024 $48,296,3 11 $ 2,037,571 $ 388,812 594,647 453,313 (23,252) (53,533) $ 1,359,987 $ 677,584 394,000 $ 283,584 1,022,365 $ 1,305,949 To the Board of Directors, Delta Air Lines, Inc.: THE WILLIAM-OLIVER BUILDING ATLANTA 3 We have examined the balance sheet of Delta Air Lines, Inc. (a Louisiana corporation) as of June 30, 1955, and the related statements of income and aurplus for the year then ended. Our examination was made in accordance with generally accepted audi ting standards, and accordingly included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. In our opinion , the accompanying balance sheet and statements of income and surplus present fairly the financial position of Delta Air Lines, Inc. as of June 30, 1955, and the results of its operations for the year then ended , and were prepared in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceding year. Atlanta, Georgia, August 26, 1955. ARTHUR ANDERSEN & CO. AUDITOR'S CERTIFICATE statements of surplus FOR THE YEAR ENDED JUNE 30, 1955 Balance at beginning of year Add: Net income . Special item-Profit on disposition of flight equipment (less applicable income taxes of $103,000) . . . . . . Excess of conversion price over par value of common stock issued on conversion of Debentures, including amount called June 24, 1955 for redemption on July 25, 1955 (Note 4) Deduct: Cash dividends on common stock Balance at end of year ($3,700,000 of earned surplus is restricted as indicated on balance sheet) Earned Surplus $ 8,760,791 1,907,175 258,850 $10,926,816 720,309 $10,206,507 Capital Surplus 5,672,436 1,981,216 $7,653,652 7,653,652 The accompanying notes are an integral part of these statements. 15 16 notes to llnanclal statements 1. DEPRECIATION RATES AND EMERGENCY AMORTIZATIONS: The Company's 3 Model 649 Constellations, which at June 30, 1955 were being leased to another airline, are b~ing depreciated to a residual value of $50,000 each from the dates placed in service (1 in 1950 and 2 in 1951) to December 31, 1955. The 7 DC-6's are being depreciated to a resid- ual value of 10% of cost from the dates placed in service (4 in 1948, 2 in 1949 and 1 in 1951) to December 31, 1955. The 16 DC-3's have been fully depreciated to a residual value of 10% of cost. The 10 DC-7's and 20 Model 340 Convairs are being depreciated for book purposes to residual values (10% of cost of DC-7's and 2% of cost of Convairs) over a period of seven years from the dates placed in service (19 Convairs in 1953 and 1 in 1954 and 7 DC-7's in 1954 and 3 in 1955). For Federal income tax purposes, 80% of the cost of these aircraft and related spare parts is being amortized under Certificates of Necessity over a 60-month period from the dates placed in service and the remaining 20% of the cost of the equipment placed in service in 1954 and 1955 is being depreciated using a method of accelerated depreciation permitted by the Internal Revenue Code of 1954. The reduction of current Federal income taxes of $335,000 in 1954 and $990,000 in 1955, result- ing from this accelerated amortization and depreciation, has been charged to income and set up in a special deferred tax reserve to provide for the estimated Federal income taxes which may arise in later years when the depreciation which is taken on the books for this flight equipment is no longer deductible for tax purposes. The effect of such accounting is to prevent the tax defer- ments resulting from accelerated amortization and depreciation from distorting annual net income during the period of acceleration or in subsequent periods. 2. PURCHASE COMMITMENTS AND CONTINGENT LIABILITY: The Company has outstanding commitments for 5 DC-7 aircraft (1 to be delivered in 1955 and 4 in 1957). It is estimated that the acquisition of these aircraft and related spare parts and acces- sories will require a total outlay of approximately $10,500,000. In addition, the Company has placed an order with Douglas Aircraft Company, Inc. for 6 DC-7's for delivery in 1957 and 1958; the Com- pany has the privilege of cancelling this order at any time before a specified future date at a rela- tively minor cost. The Supreme Court of the United States by decision dated February 1, 1954, sustained the Post Office Department's objection to a Chicago and Southern Air Lines, Inc. (C&S) international mail rate order issued by the CAB in October 1951 (the so-called "offset" case). The Department con- tended that the entire operations of a carrier with both domestic and international divisions should be taken into consideration in determining the mail pay requirements of either division, and that accordingly the rate order in question provided excess mail revenue of $654,000 for the calendar years 1948-1950. The Supreme Court decision requires the CAB to review its original order and redetermine the mail pay requirements for the C&S international operations for the periods involved in accordance with the principles therein established. The amount of mail pay refund, if any, that Delta may be required to pay as successor of C&S cannot now be determined. 3. PROPERTY ACQUISITION ADJUSTMENT: This account represents chiefly the excess of fair value over book value of flight equipment acquired from Chicago and Southern Air Lines, Inc. when that Company was merged into Delta as of May 1, 1953. The original amount of $2,753,381 is being reduced by amortization over a 60-month period from May 1, 1953 and by credits from sales of the related flight equipment. Dur- ing fiscal 1955 the account was reduced by amortization of $199,290 charged to non-operating expense and $59,910 charged to incidental revenue applicable to the three Constellation aircraft leased to another airline. 4. REDEMPTION OF DEBENTURES: During 1955 the Company called for redemption $5,000,000 of 5 % Convertible Debentures (Subor- dinated) including $2,500,000 ($2,128,900 convened and $371,100 redeemed) called on June 24, l 955 for redemption on July 25, 1955 and reflected in the accompanying balance sheet. On August 9, 1955 the Company called $3,000,000 additional Debentures for redemption on September 9, 1955. 5. OPTIONS HELD av FORMER OFFICERS: The merger agreement with Chicago and Southern Air Lines, Inc. (C&S) provided that options granted to certain officers of C&S for the purchase of common stock of C&S for $10 per share would be honored by Delta by selling to holders of the options at $10 per share the amount ($21) of 5% Convertible Debentures (Subordinated) which stockholders of C&S could receive in exchange for each share of their common stock. The remaining options at June 30, 1955 to acquire $42,000 of Debentures for $20,000 expire August 21, 1956. M ILLIONS 98 .4 ... I ,..... I ...,. r I ,. ~ ...... I , I ' I I ' .... __ II ... ' ~ ~I" I ... ,,. ~ ......... , .. ~,,.. .... Ill"# I I __ ...._ ,_. .......... , I ~-'!!'I - ..__ ,_. ... ~ I I --~ .- - I --- 1 .- "'II,... ...... l...a"'" j --- __ ...._ .- I Delta Air Lines, Inc. FOR Y E ARS E NDING JUN E 30 _ , l ' ' ' ' ........ ....... --- ._ ---- - "'- - ' ' -- I_,,,,,,,.,,,__ --- .. "' ~ .... ' ....... ....... ~ ... 19 55 1954 1953 1952 1951 1.000 900 800 700 600 500 400 300 200 100 94 90 86 82 78 74 70 66 6 2 58 54 50 46 42 38 34 30 26 ........ ---- ....... .,,,, I ' ~ IONS ""11111111"" - ~ ,..,,, ~ ....... , I ,. __ ..._ -- .......... ',I' I .__ II 1950 _......II" - ..... ~ - ~ ..,._ JUL AUG SEPT OCT NOV DEC JAN FEB MAR APR MAY JUN REVENUE PASSENGER MILES* - 50 - DE PRE CIATION ,______ 40 DE PRE CIATION 30 NET DEPRE BOOK --- NET ------ VALUE ,__..._ CIATION BOOK 20 VALUE ,_____ NET - ,_____ 10 BOOK VALUE ~ MIL IONS 1953 1954 1955 FLIGHT EQUIPMENTt 200 AVAILABLE TON MILES 180 160 REVENUE TON MILES 140 120 100 80 60 40 20 MI L l!.IONS '46 '47 '48 '49 '50 '51 '52 '53 '54 '55 TON MILES AND PLANE MILES * COMBINED DELTA- C8cS SYSTEMS '46 '47 '48 '49 so '51 52 '53 '54 '55 REVENUE PASSENGER MILES .-----~---------------------, 7 :r--- -- - - -- - - - - --1 6 5 YEAR EARNINGS { 18.96 ,__r_ Nc _,_ u_p_r N _ G_PR _o_m_ s _FR_ O_M _ SA _LE _ s _o_, ~Q_ ur_P M _EN_,_...., 5 TOTAL ,lS DIVIDENDS 1--- -- - - -- - - -- ---1 4 '51 '52 '53 '54 '55 EARNINGS AND DIVIDENDS PER SHARE DOLLARS PER SHARE 30 28 26 24 22 20 18 16 14 12 10 8 6 4 2 - - ,- - ,- - -- - - - - - - - ..... - - - - - - - - - - - - -- ,-.. - - - - --- - ..... - ..... ,- - - - - - - - - -- - - ..... -- - - - - - - - ..... -- - - -- - -- - - ..... -- - - ,- - -- - ,- - - - - - '46 '47 '48 '49 '50 ' 51 '5 2 '53 '54 '55 NET BOOK VALUE PER SHARE OF COMMON STOCK t t AS OF JUNE 30 3 2 17 ---- Delta Air Lines, Inc. -~~~to{ roaJfrL ;. 1955 1954 1953 195 1 1949 YEA.RS ENDED JUNE 30TH 1948 1947 1946 Total assets . $54,049,882 $48,089,997 $37,966,469 $16,836,905 $14,402,050 $12,371,851 $12,629,268 $ 9,352,827 $ 9,306,766 $ 6,034,364 Current assets . 18,762,696 15,888,546 14,706,498 9,027,490 7,184,532 5,170,591 5,310,482 4,682,029 5,630,338 2,765,210 Current liabilities 12,686,444 8,861,111 9,192,041 6,618,627 4,541,282 2,950,443 2,751,859 2,180,988 2,253,963 1,638,948 Net working capital . 6,076,252 7,027,435 5,514,457 2,408,863 2,643,250 2,220,148 2,558,623 2,501,041 3,376,375 1,126,262 Stockholders' equity . . . . 19,845,898 16,233,227 15,647,278 9,808,493 8,658,043 7,401,245 6,710,494 6,196,053 5,789,701 4,220,770 Stockholder equity per share . . . . 29.98 27.06 26.08 19.61 17.32 14.80 13.42 12.39 11.58 10.55 Shares of common stock outstanding at end of year . . . . . . . . . 661,913 600,000 600,000 500,000 500,000 500,000 500,000 500,000 500,000 400,000 Operating revenues Passenger $53,966,525 $45,144,949 $28,946,479 $23,995,938 $19,006,936 $13,761,453 $11,987,246 $10,079,272 $10,558,559 $ 6,944,162 Mail 1,462,684 1,723,703 1,131,578 1,035,599 1,306,752 2,373,213 2,434,888 2,010,668 423,292 680,359 Express 917,609 844,483 550,305 431,240 374,480 238,441 244,859 273,099 242,978 137,540 Freight 1,844,168 1,766,266 1,044,338 827,927 720,719 478,537 358,503 303,115 109,603 All other 996,975 854,481 665,102 727,417 812,112 333,651 202,349 152,815 154,404 97,955 Total revenues 59,187,961 50,333,882 32,337,802 27,018,121 22,220,999 17,185,295 15,227,845 12,818,969 11,488,836 7,860,016 0 pera ting expenses (excluding depreciation) 47,047,051 43,021,159 26,641,944 21,155,513 I 7,499,480 14,568,386 13,096,091 11,605,990 10,837,709 6,694,265 Depreciation 6,444,981 5,275,152 2,259,784 1,485,556 1,389,721 1,206,755 1,185,865 1,012,954 944,659 609,888 Total expenses 53,492,032 48,296,311 28,901,728 22,641,069 18,889,201 15,775,141 14,281,956 12,618,944 11,782,368 7,304,153 Operating ratio 90.38% 95.95% 89.37% 83.80% 85.01 % 91.79% 93.79% 98.44% 102.55% 92.93% Net non-operating revenue or (expense) (1,376,754) (1,359,987) (1,345,957) 12,398 (75,000) (5,403) (52,603) (50,845) (67,302) (12,793) Net income before taxes 4,319,175 677,584 2,090,117 4,389,450 3,256,798 1,404,751 893,286 149,180 (360,834) 543,070 Taxes on income . 2,412,000 394,000 688,000 2,739,000 1,625,000 589,000 336,000 56,343 127,459* 232,835 Net income . 1,907,175 283,584 1,402,117 1,650,450 1,631,798 815,751 557,286 92,837 (233,375) 310,235 Net income as % of revenues 3.22% .56% 4.34% 6.11% 7.34% 4.75% 3.66% .72% 3.95% Special item - profits from major flight equipment sales (after taxes) 258,850 1,022,365 2,756,561 82,154 111,893 Total income and special item 2,166,025 1,305,949 4,158,678 1,650,450 1,631,798 815,751 639,440 204,730 (233,375) 310,235 Per share of stock outstanding 3.27 2.18 6.93 3.30 3.26 1.63 1.28 .41 (.47) .78 Revenue plane miles (000) 31,579 31,916 20,672 17,531 15,698 13,804 12,921 12,803 11,822 8,195 Available seat miles (000) 1,517,891 1,344,069 776,157 653,121 541,038 437,209 361,199 349,235 335,630 186,650 Passenger load factor 62.75% 57.26% 65.41 % 65.46% 63.81 % 54.51 % 55.84% 53.92% 66.35% 80.04% Available ton miles (000) 182,997 162,345 94,045 80,089 71 ,987 59,532 49,544 46,562 42,716 21,981 Revenue ton miles (000) 104,927 87,251 57,565 48,093 40,480 27,259 22,805 19,966 22,799 15,860 Overall load factor 57.34% 53.74% 61.21% 60.05% 56.23% 45.79% 46.03% 42.88% 53.37% 72.15% Percent of scheduled miles flown 98.79% 98.29% 98.83% 98.98% 98.91% 97.90% *Credit ) Loss These data reflect operations of Delta Air L ines, Inc., and do not include the C&S s-ystem prior to May 1, 1953. 18 19 Delta ticket ollices TICKET OFFICE ALEXANDRIA Alexandria Air Base ASHEVILLE Battery Park Hotel ATLANTA Piedmont and Biltmore Hotels AUGUSTA Richmond Hotel BATON ROUGE Heidelberg Hotel BEAUMONT Jefferson County Airport BIRMINGHAM 2002 Fifth Ave., North BRUNSWICK Malcolm-McKinnon Airport CARACAS, Venez. Edificio Paris, Plaza Candelaria CHARLESTON Francis Marion Hotel CHATTANOOGA Hotel Patten CHICAGO 67 East Monroe, Conrad Hilton Hotel and 1649 Orrington, Evanston, Ill. CINCINNATI Sheraton-Gibson Hotel and Netherland Plaza CIUDAD TRUJILLO, D.R., Arz. Nouel esq. Sanchez COLUMBIA Hotel Wade Hampton COLUMBUS, GA. Ralston Hotel DALLAS 214 S. Akard St. (Baker Hotel) DETROIT 1235 Washington Blvd. EVANSVILLE Mccurdy Hotel FORT WAYNE Baer Field Airport FoRT WORTH Hotel Texas GLADEWATER Gregg County Airport GREENVILLE Municipal Airport GREENWOOD Municipal Airport HATTIESBURG Municipal Airport HAV;'\NA, CUBA Prado 301 HENDERSONVILLE Asheville- Hendersonville Airport HoT SPRINGS Memorial Airport HOUSTON Mellie-Esperson Bldg. and Rice Hotel INDIANAPOLIS Claypool Hotel JACKSON Heidelberg Hotel JACKSONVILLE 226 West Forsyth St. KANSAS CITY Muehlebach Hotel KILGORE Gregg County Airport Kl\'OXVILLE Farragut Hotel LEXINGTON Blue Grass Airport LITTLE RocK Marion Hotel LONGVIEW Gregg County Airport RESERVATIONS TELEPHONE 4471 7601 LAmar 3242 2-8811 5-4491 5-7541 59-9601 BRunswick 107 55-8488 4-2567 2-8336 Flnancial 6-5300 DUnbar 1-3232 5350 4-3186 7-7458 Rlverside 9401 WOodward 2-7190 5-9023 H-3352 EDison 5425 PLaza 3-2688 2-8213 2218 JUniper 2-1643 M-8224 7211 NAtional 3-1671 CApitol 5-1361 MElrose 7-1554 2-0861 ELgin 3-3171 GRand 7733 6488 7-6611 4-5569 FRanklin 5-9111 PLaza 3-2688 TICKET OFFICE MACON Hotel Dempsey MEMPHIS Peabody Hotel MERIDIAN Key Field MIAMI 300 N.E. First (Columbus Hotel) MIAMI BEACH 1636 Collins Avenue MONROE Frances Hotel MONTEGO BAY, Jamaica Montego Bay Airport MONTGOMERY Jefferson Davis Hotel NEW ORLEANS 708 Common St. (St. Charles Hotel) and Roosevelt Hotel PADUCAH Barkley Field PORT ARTHUR Jefferson County Airport PORT-Au-PRINCE, Haiti c/o Nadal & Co. SAN JUAN, Puerto Rico Caribe Hilton SAVANNAH Hotel Savannah SELMA Selfield Airport SHREVEPORT Captain Shreve Hotel SPARTANBURG Memorial Airport SPRINGFIELD Municipal Airport ST. Lours Statler Hotel TOLEDO Commodore Perry Arcade TYLER Pounds Field by Transportation Ad-Views for highest ad score during year ending Oct. 1, 1954 RESERVATIONS TELEPHONE 3-6731 WHitehall 8-2641 2-3141 3-0441 3-0441 3-5116 2811 4-7313 TUlane 8592 31732 2-4321 3313 9-0045 3-0267 TRinity 4-7581 5-3232 7131 4-7353 GArfield 1-5511 LU (Holland) 7-2366 4-8425 Transportation Ad-Views 1954 SOCRATES AWARD to Delta-C&S Air Lines Atlanta, Georgia George E. Bounds Director of Advertising and to Burke Dowling Adams, Inc. creators of their advertising for consist01t txcdltnct i" newspaper advertising during tht past twcfot mo11ths i11 competition with mJtral himdrtd other tratt,portation compattits itt the 'Uttit,d Statts R. w. COURTS Atlanta, Ga. C.H. DOLSON Atlanta, Ga. EDWARD H. GERRY New York, N. Y. JOHN R. LONGMIRE St. Louis, Mo. R. s. MAURER Atlanta, Ga. LAIGH C. p ARKER Vice President - Traffic and Sales C.H. DOLSON Vice President - Operations w. T.ARTHUR Asst. Vice President - Operations directors R. W. FREEMAN, Chairman New Orlearns, La. C. H. McHENRY Monroe, La. LAIGH C. p ARKER Atlanta, Ga. CARLETON PUTNAM Washington, D. C. WINSHIP NUNNALLY Atlanta, Ga. officers C. E. WOOLMAN President and General Manager TODD G. COLE Vice President - Finance and Assistant Secretary R. s. MAURER Vice President - Legal T. M. MILLER Asst. Vice President - Traffic and Sales TRAVIS OLIVER* Monroe, La. R. J. REYNOLDS Winston-Salem, N. C. J. WOODALL RODGERS Dallas, Tex. D. Y. SMITH Monroe, La. C. E. WOOLMAN Atlanta, Ga. ERLE COCKE, JR. Vice President - Civic Afjairs w. T. BEEBE Vice President - Personnel R.H. WHARTON, JR. Asst. Vice President - Personnel CATHERINE FnzG ERALD Assistant Treasurer C. H. McHENRY Secretary- Treasurer Transfer Agent for Common Stock The Citizens & Southern National Bank Atlanta, Georgia Auditors -Arthur Andersen & Co. * Deceased February 16, 1955 Trustee for Debentures The First National Bank of Atlanta Atlanta, Georgia Registrar for Common Stock Trust Company of Georgia Atlanta, Georgia Annual Meeting- October 18, 1955, Monroe, Louisiana GENERAL OFFICES ATLANTA AIRPORT ATLANTA . GEORGIA