Delta Air Lines annual report 1968

Delta Air Lines, Inc. 1968 Annual Report
HIGHLIGHTS OF THE YEAR
A comparative summary of the major yardsticks for evaluation of
operations for years ended June 30 is shown below. Dollars are expressed
in thousands except per share figures.
1968
Operating Revenues . . . . . . . . . . . $431,562
Operating Expenses .. . . . ...... . $363,140
Netlncome .. ..... .. .. . . . .... $ 36,134
Shares Outstanding at year end .. 19,125,000
Earnings Per Share . . . . . . . . . .. . $1.89
Total Stockholder Equity . . . . .. . $194,974
Stockholder Equity Per Share . . .. $10.19
Revenue Passengers Carried ... .. 10,368,831
Available Seat Miles ( 000) . .. . . 11,972,737
Revenue Passenger Miles (000) .. 7,116,095
Passenger Load Factor . .... .... 59.44%
* Adjusted to reflect 3-for-1 stock split December 1, 1967
THE COVER
Delta's leadership in the industry has been built
in large measure upon the unique spirit and
morale of its people. The individuals pictured
in this report are representative of the more
than 16,500 Delta employees whose loyalty and
dedication have contributed to Delta's sound
growth and continued success.
The ticket agent is in the forefront of our sales
force at an increasing number of conveniently
located ticket offices.
Per Cent
1967 Change
$397,836 + 8%
$308,737 +18
$ 49,190 -27
19,125,000*
$2.57* -26
$166,490 +17
$8.71 * +17
9,422,422 +10
9,687,337 +24
6,415,467 +11
66.23% -10
REPORT TO THE STOCKHOLDERS
Delta has concluded another successful fiscal
year highlighted by continued healthy growth in
revenues and traffic. New records established
included $431.6 million operating revenues, 10.4
million passengers, 7 .1 billion revenue passenger
miles, and 136 million cargo ton miles. And net
earnings of $36,134,000 or $1.89 per share were
second only to the extraordinary $49,190,000 earned
during strike inflated fiscal 1967.
The year saw a major improvement in the delivery
of additional Super DC-8 and Super DC-9 aircraft
and a resulting expansion of our jet fleet by some
40%. The added capacity permitted new or im-
proved jet service to the vast majority of the 61
communities Delta serves-and a reduction in piston
services to less than 3.5 % of system capacity at
year-end. Another direct result of the increased jet
fleet was a lowering of the system load factor from the
undesirably high level of 66 .2 % in 196 7 caused by
equipment delays and competitors' strike to a more
reasonable and planned level of 59.4% for the
latest year. Elimination of the more costly four engine
piston services together with the inherent efficiencies
of the larger jet aircraft produced significantly
lower unit costs, despite the continued inroads of
inflation on labor, fuel, material, and rents.
During the year substantial additions were made
to the long range equipment plans and, again, it was
necessary to expand these plans to cover even longer
time periods. After very careful and thorough
evaluation of both the Douglas and Lockheed pro-
posals, Delta signed an agreement with Lockheed for
twenty-four 250-passenger L-1011 trijet aircraft.
The contract provides for twelve aircraft to be
delivered beginning in late 1971 and a second group
of twelve for delivery beginning in 1973. The
2
L-1011 combines the spaciousness and luxury of
the "jumbo" jets with the short haul capabilities of
smaller jets, permitting Delta to provide service in the
short to medium range markets comparable to the
luxury afforded longer range markets with the
previously announced Boeing 7 4 7 aircraft. The
L-1011 is a logical addition to Delta's jet fleet to
meet the need for a high capacity aircraft in medium
range markets.
Total value of the L-1011 order, the largest in
Delta's history, is $360 million. Including the two
Boeing 7 4 7 options exercised during the year and all
previously announced orders and options for
Douglas and Boeing aircraft, the Delta passenger
fleet of 197 5 will total 151 jets. The annual seat mile
capacity of these aircraft will be over two and one-
half times the fiscal 1968 capacity and their total
value will exceed one billion dollars. Financing will
be provided from internally generated funds and a
$175 million bank loan agreement concluded
during October, 1967.
The advent of high capacity aircraft in the early
1970's will alleviate a portion of the growing and
serious problems of air traffic congestion and in-
adequate airport facilities. At the same time,
however, they will aggravate and compound others,
including the very difficult one of ground transporta-
tion to and from the airports. Even if unlimited funds
were available, which they are not, it will take time
to unravel and resolve these three major problems.
We are confident, however, that the airline industry,
in cooperation with the local airport authorities
and the regulatory agencies of the government, has
the capability to provide the needed solutions.
We would point out that these conditions were
brought on by the rapid growth of the jet age. And
the difficulties of growth in a viable industry are
always more pleasant than the opposite problems in a
regressing industry.
In order to meet the challenge of the exciting
years ahead and insure the necessary continuity and
flexibility of management, Delta significantly broad-
ened its executive ranks during the past year. The
five division heads were promoted to Senior Vice
President: W. T. Beebe, Administration;
David C. Garrett, Jr., Operations; R. S. Maurer,
General Counsel and Secretary; T. M. Miller,
Marketing; and Robert Oppenlander, Finance and
Treasurer. R. L. Griffith was named Vice President-
Federal Affairs and ten new Assistant Vice Presidents
were named including R. W. Allen, Administration;
W. A. Atchison, Computer Services; T. P. Ball,
Flight Operations; J. A. Cooper, Economic
Research; Shelby D. Dement, Traffic and Sal~s;
M. 0. Galloway, Comptroller; Jack S. King, Flight
Control; J. W. Meyer, Customer Relations;
L. G. Rodefeld, Communications; and
Morris Shipley, Civic Affairs.
In addition to the executive promotions, numerous
others were made throughout all levels of company
management. Each was made in keeping with Delta's
long standing policy of development and promotion
from within the company. The continued progress
and sound growth of Delta depend very heavily
upon the loyalty and support of all our 16,500
employees and of you, our stockholders.
The outlook for fiscal 1969 is encouraging even
in the shadows of continuing inflationary pressures
and the full impact of the 10 % surtax. The return to
more normal growth patterns reflected in the June
quarter operating results strengthens our belief that a
reasonable earnings growth can continue to be
achieved. The added capacity in the coming year will
moderate to a planned 19 % as the recent doubling
up of late aircraft deliveries is overcome. Increases in
traffic volume should be more closely related to
capacity input and the load factor should stabilize.
Yields are expected to level and possibly improve if
the Civil Aeronautics Board responds positively
to the industry needs. A further improvement
in unit costs is forecast although at a more modest
rate due to the continued and difficult
pressures of inflation.
In summary, we believe fiscal 1969 will again
show solid growth in all areas, further enhancing the
strong financial position of Delta and its ability to
provide the finest in jet service.
C. H. DOLSON, President
September 9, 1968
3
Revenues
Operating revenues were at a new high of
$431,562,000 and continued an uninterrupted
growth trend over a span of 33 years. Excluding the
estimated strike effect from 1967 results, revenues
increased 13 % over the previous year.
New records were also established in revenue
passengers carried (10,368,831); in revenue
passenger miles (7,116,095,000); and in passenger
revenues ($396,793,000), the latter a 10% gain
over strike inflated 1967.
The passenger revenue growth was diluted by a
further 1 % decline in passenger mile yield due to the
continuing effect of discount fares in the first half
of this fiscal year. Beginning in February, however,
yields stabilized and remained at the previous year's
level for the remainder of the fiscal year.
Despite a 14 % increase in cargo ton miles, cargo
revenues increased less than 2 % to a total of
$32,141,000. Priority mail revenue was down 19%
due primarily to a 10% retroactive reduction in
mail rates. First class mail revenue increased 13 3 %
to $3,327,000 reflecting a further expansion of
Post Office Department policy to use air transporta-
tion for the longer haul non-priority mail.
Expenses
Operating expenses increased 18 % over 1967 to a
total of $363,140,000 due primarily to the 24%
increase in operating capacity. The 1968 total was
reduced $4.2 million by the elimination of all engine
overhaul reserves. These reserves were originally
established to offset expected peakings in jet engine
overhaul costs. The continued improvement in jet
engine reliability together with the increasing
number of engines in service have combined
As an airplane is directed into a parking position,
a closely coordinated team of ramp employees
prepares to unload, service, and reload the plane
for an on-time departure.
to level overhaul costs.
Unit costs, after a temporary leveling in 1967,
resumed a downward trend from the highs of 1961 as
the delayed deliveries of the more efficient Super
DC-8 and DC-9 aircraft were received, permitting
substantial retirements of piston aircraft. Available
ton mile costs declined 5 % for the year and available
seat mile costs were down 4 % -both reaching new
all-time lows. Further improvement should be
realized in fiscal 1969 as the remaining piston air-
craft are replaced and additional Super DC-8's and
DC-9's are introduced. The current trend of infla-
tionary pressures will dilute the true efficiency gain
and hold any improvement to a modest level.
Earnings and Dividends
Net earnings were $36,134,000, or $1.89 per share,
and were the second highest in Delta's history,
exceeded only by the $49,190,000 earned in the
strike inflated 1967 fiscal year.
Earnings from operations were $35,899,000, equal
to $1. 8 8 per share after provision for normal taxes
and the retroactive 10 % surtax. Net gain on the
disposition of aircraft and other property was
$235,000 or 1 per share. The overhaul reserve
adjustment contributed 11 per share to after-tax
earnings.
For 1967, earnings from operations were
$46,788,000 or $2.44 per share including an esti-
mated 50 benefit from the 43-day work stoppage
against five major trunk lines in the first two months
of that year. The strike benefit was originally
estimated at 3 7 per share ( on present shares) but
was revised upward the following summer based on a
better knowledge of the true impact of the strike on
yields. Net gains from the disposition of aircraft and
the insurance proceeds from an aircraft lost in
training added $2,402,000 for combined earnings
of $2.57 per share in 1967.
Beginning with the September 1, 1967 quarterly
payment, the dividend rate was increased 20% to
10 per share after adjustment for the 3-for-l stock
5
split. Aggregate dividend payments for the year
were $7,650,000.
Flight Equipment
Delta expanded its jet fleet by more than 40 % last
fiscal year with the delivery of three Super DC-S's and
nineteen Super DC-9's. One standard DC-9 was
added on a short-term lease expiring in 1969 and
one standard DC-8 was purchased under a lease-
purchase agreement.
During the fiscal year, options were exercised for
future deliveries of one Super DC-8 and seven
Super DC-9's, as well as the fourth and fifth Boeing
7 4 7 aircraft. Shortly after the close of the fiscal year,
options on an additional four Super DC-9's were
exercised.
Both Lockheed and McDonnell Douglas presented
their specifications for the "Airbus" during the past
year. Their proposed 250-passenger, three-engine
planes, far from being "airbusses," will be the most
luxurious and. appealing to passengers of any airplane
ever developed. After an exhaustive examination
of both proposals, Delta purchased 24 Lockheed
101 l's. Compared to the Super DC-8, the L-1011 is
planned to reduce seat mile cost by 2 % at Delta's
normal operating trip length and increase passenger
revenue potential by some 32%.
The following table shows the pattern of deliveries
for all aircraft on order and on option:
Type Fleet Fleet
Deliveries in Fiscal Years Total
Total
of
Aircraft Seats 6/30/68 1969 1970 1971 1972 1973 1974 1975 6/30/75
DC-8 135 21
DC-8 195 5 5 3
DC-9 70 15
DC-9 89 22 27 9
CV-880 96 16
B-747 375 3 2
L-1011 250 5 6 6 7
L-100 Cargo 3
:sr 32 12 3 7 6 6 7
After return of one leased aircraft in 1969
With the continuing deliveries of DC-9's, the
four-engine piston fleet is rapidly being replaced.
The remaining DC-7 aircraft were phased out on
6
21
13
14*
58
16
5
24
3
154
February 1, 1968 and the DC-6 phase-out will be
completed by September. The two-engine Convair
440 fleet is programmed for retirement by the end of
fiscal 1969. These retirements will result in significant
economies of operation.
Delta holds three delivery positions for the Boeing
Supersonic Transport. Advance deposits totaling
$600,000 have been made on these aircraft. The
Federal Aviation Agency also requested U.S. carriers
to advance one million dollars per delivery position
as risk money to supplement the manufacturer's
and Federal funds during prototype development.
This money will be recovered with interest if
sufficient aircraft are sold to provide royalties to
the government. Delta advanced the requested three
million dollars during fiscal 1968. The Internal
Revenue Service has classified this advance as
research and development costs to be fully deductible
for tax purposes in the current year. The Civil
Aeronautics Board has prescribed a five year book
amortization period for all participating airlines.
Although Boeing and the FAA are generally
dissatisfied with the relationship of prototype
performance to production aircraft performance
objectives, it is expected that these difficulties will be
resolved and a revised certification date be made
available in January, 1969.
Operational Equipment and Programs
During the past year, a DC-8 and DC-9 simulator
was purchased from Link Group-General Precision
Systems. With the expanded DC-8 and DC-9 fleet,
these simulators will provide capability for perform-
ing a significant number of pilot proficiency checks
on the ground, minimizing the requirements and
costs of removing aircraft from revenue service for
The men at the controls-Delta's flight crews
-are men of the highest professional stand-
ards with years of experience and a back-
ground of intensive and continuing training.
I
pilot training. These simulators are programmed
for installation in 1969.
A new communications switching system was
purchased for instaJlation by September, 1968. This
system is capable of handling the expected increase in
message traffic ( both passenger and cargo) to be
generated by the increasing fleet of Delta aircraft.
The cargo capacity of the three Delta airfreighters
will soon be increased by 20% under the modifica-
tion program announced last fiscal year. The
program to "stretch" the L-100 is now under way
and should be completed in late December. In
addition to the increased capacity, the modification
is expected to improve both the operating perform-
ance and the reliability of the L-100.
As a result of refinement of jet technology and the
industry growth, the airlines and the FAA have been
seeking to provide better and more realistic methods
for responsively relating aircraft operating experi-
ence to control of aircraft maintenance requirements.
Delta obtained FAA concurrence for both its
aircraft and power plant reliability programs and
completed the implementation of these programs in
fiscal year 1968. These programs are extensions of
the "management-by-exception" concept. They focus
on those aircraft systems or components which tend
to decrease operational reliability, while at the same
time allowing Delta greater freedom and responsi-
bility in adjusting the maintenance and inspection
periods of the highly reliable units and systems.
Major benefits are improvement in reliability and
safety and increased utility of our flight equipment.
Capitalization and Financing
In October, 1967 Delta arranged a new bank credit
agreement with a group of 25 banks in 1 7 cities on
Engineers and skilled technicians are con-
stantly seeking new ways to improve the
safety, reliability, and performance of
Delta's flight equipment.
Delta's system providing up to $175 million on a
revolving basis through calendar 1969. The balance
outstanding at the end of 1969 will be converted to
a term loan. This new agreement repaid and
terminated the 1966 Revolving Credit of $45 million.
A total of $ 9 5 million had been borrowed as of
June 30, 1968.
With the recently announced orders and options
for the Lockheed L-1011 aircraft, Delta's probable
future capital outlays will exceed $600 million
through 197 5. The new bank loan agreement
together with normal internal cash generation from
earnings, depreciation, and def erred taxes are
currently estimated to be adequate for these pro-
jected capital requirements. At June 30, 1968,
Delta's long-term debt to equity ratio was only 68 %
or roughly one-half the industry average.
At the regular annual meeting of stockholders on
October 26, 1967, approval was granted ~or an
increase in total stock authorized from 8 million to 25
million shares and a 3-for-1 stock split. The issue
of two additional shares for each share held
increased the total stock outstanding to 19,125,000
shares. Adjusted for this split, stockholder equity was
$10.19 per share or $194,974,000, up 17%
over June 30, 1967.
Facilities
Delta continued its program to expand and improve
ground facilities. In Atlanta, the second of the ultra
modern rotundas will soon be occupied. These
rotundas add 12 new J etway parking positions and
upper level passenger lounges for faster, more
convenient passenger handling.
Major terminal additions or expansions are
planned in nearly half the cities we serve, including
four new airports and related facilities already
under construction at Jacksonville, Dallas/
Ft. Worth, Kansas City, and Houston. Since
several of these projects are of a long-term
nature, interim reworks will be required in a
number of cases to accommodate the Boeing 7 4 7's
9
and Lockheed 1011 's scheduled for delivery be-
ginning in late 1970 and late 1971 respectively.
The Chicago maintenance hangar expansion is
planned for completion later this year and a new
hangar is under construction in Houston. During the
past year, Delta occupied the expanded facilities at its
general maintenance and overhaul base in Atlanta.
A new 51,000 square foot Computer Center,
specifically designed to house the latest generation of
large computers, was also completed and occupied.
The Training Center for stewardesses, pilots, and
ground personnel should be completed later this year.
In addition, customer servicing facilities (reser-
vation offices, ticket offices, etc.) are being enlarged
in many cities to cope with the additional traffic
produced by Delta's growth and fleet acquisitions.
Passenger Fares
Revenue per passenger mile slowed its downward
trend, dropping 1 % from 5.65 to 5.58 as com-
pared to a reduction of 3 % in fiscal 19 6 7 and 4 %
in fiscal 1966. Effective February 1, 1968, the Civil
Aeronautics Board approved a simplified fare
structure under which fares for trips of 750 miles or
under were increased and those over 7 5 0 miles were
decreased to the next even dollar amount. Since
Delta's average passenger length of haul is less than
700 miles, this rounding resulted in slightly more
revenue and served to stabilize yields and offset
further increases in the percentage of travel under
discount fares. This percentage increased to
40% in 1968 from 35 % in fiscal 1967.
Shortly after the close of the fiscal year, the Civil
Aeronautics Board also approved a revised Family
Plan fare which will further stabilize yields. These
actions indicate a recognition by the CAB that the
industry can no longer withstand further yield erosion
in the face of a continued upward pressure on carrier
costs-particularly in view of substantial existing
commitments for new aircraft and ground handling
facilities. Fiscal 1969 should reflect a reasonably
stable yield for the first year since the jet age began.
10
Personnel
Delta is particularly proud of and grateful for the
spirit of dedication and loyalty of its employees and
the contribution each has made to.the sound growth
and continued success of your company. The various
employees pictured in this report are representative
of the many skills and talents required to provide the
best possible service to our customers and to operate
and service the finest in jet equipment. The "Delta
Family" grew to a total of more than 16,500 at
year end, of which one in four had ten or more
years service with Delta. Total salaries and related
employee benefit costs were $168 million for the year
or roughly 39 cents out of every revenue dollar.
Delta maintains a complete employee training
program with a curriculum as varied as the many
skills required to operate the airline. An extensive and
demanding program of initial and recurrent training
insures the highest possible standards for our flight
personnel. Ground personnel receive initial and
recurrent training in both technical and non-technical
subjects to help them meet the needs of a constantly
changing technological and industrial environment.
Additionally, all employees are offered a broad
range of self-help training programs designed to
improve their ability to progress and participate fully
in the opportunities afforded by the sound growth
of your company.
During recent months, Delta has participated fully
with the National Alliance of Businessmen in a
program designed to help meet the challenge of mi-
nority unemployment. Substantial numbers of both
"hard-core" and "poor-youth" personnel are currently
employed in the major cities along our route system.
Delta chose to underwrite the full cost of the
A customer's first contact with Delta is
through the voice of the reservations
agent who has been trained to offer the
vital personal touch.
program, including the recruitment, motivation,
training and assignment of these people to mean-
ingful and productive work, without governmental
subsidy support.
Services
Continued delivery of the 89-passenger DC-9-32
aircraft has contributed more jet service to Delta
cities than ever before. During the year, jet serv-
ices were inaugurated in Asheville, Lexington, Toledo
and Columbus, Georgia. On July 1, 1968, DC-9
service was initiated in Meridian and Monroe leaving
only nine cities on the system without jet services.
This enhanced jet flexibility has enabled Delta to
utilize the larger DC-9-32 aircraft on traditionally
heavier density routes and to continue replacement of
piston aircraft. At year-end, piston aircraft provided
less than 3.5% of our system available seat miles.
There was an overall upgrading of service through-
out the entire system. Notable examples of this
upgrading include an increase from five to seven
Atlanta-San Francisco round trips, from ten to
twelve Atlanta-Los Angeles round trips, and the first
daytime service to Las Vegas. The "Early Bird"
schedule pattern and service program, started two
years ago, has continued to expand and, with the
newer "Owly Bird" services, provide Delta passengers
with early morning and late evening bargain flights
to business and commercial centers across the system.
New advertising and promotional programs for the
"Early Bird" and "Owly Bird" services were inaugu-
rated in Dallas, Los Angeles artd San Francisco to
introduce the pattern in those cities. The "Early Bird"
and late night "Owly Bird" concepts are now
thoroughly ingrained in the business schedules of
the major communities served.
The machinist and his machine-represent-
ative of the many varied skills and the large
investment in complex tooling and equip-
ment required to maintain our jet fleet.
The 195-passenger DC-8-61 aircraft were utilized
in the Midwest to Florida and Southern Transconti-
nental schedules complex for the first time this year.
Four of the Super DC-8 jets provided service to
Florida and California bound vacationers and
answered the need for increased capacity. The de-
livery of additional aircraft in the months ahead will
add even greater potential to Delta's strong leadership
in these dense travel markets.
Increased cargo service has been proportionate to
our overall service increase and new equipment has
played a vital role in this expanded and improved
area of Delta. The Lockheed L-100 modification
program, which increases payload capacity by 698
cubic feet, will further improve our ability to meet the
, needs of our cargo customers.
The L-100 has continued its outstanding per-
formance as an all-cargo aircraft and now transports
approximately 25 % of Delta's total cargo. In-
creased DC-9 and Super DC-8 services have also
contributed significantly to the cargo program.
Faster, more frequent jet cargo service is now pro-
vided by new DC-9 equipment and Delta's Super
DC-8's have doubled the cargo carrying capacity on
regular DC-8 routes. A program of reserved air
freight space has been finalized and is planned for
implementation in the months ahead ... an additional
enhancement of Delta's "full-line" cargo program.
The DELTAMATIC Reservation System has played
an increasingly greater role in supporting various
customer and marketing services. The computer
system's dramatic capability has contributed im-
measurably to timetable and quick reference schedule
production. A computerized tele-ticketing program
was introduced and will be expanded as need
demands. The computer system now provides valu-
able information to our Customer Relations
Department and amplifies Delta's ability to give
prompt and personal handling to correspondence
from our customers. DELTAMATIC also pin-points
present sources of revenue and market potential,
13
affording our sales personnel the opportunity of
servicing present customers and soliciting new ones
in a more direct and knowledgeable manner. These
computer innovations, and more, are a by-product of
the DEL TAMA TIC reservation system that is second to
none in the world, underscoring Delta's leadership in
the industry and highlighting the increased efficiency
obtained through technological improvements.
Shortly after the close of the fiscal year, the
DELTAMATIC system was converted to the latest
generation of computer hardware. The new IBM 360
system has a total capacity equal to five times that
of the system it replaces. When fully operable, the
new system will provide adequate capacity for the
forecast traffic volumes through 197 5.
Regulatory Matters
Transpacific Route Investigation: Seventeen carriers
are seeking new routes between the U.S. Mainland
and points in the Pacific as far west as India, including
Hawaii and both Oriental and South Pacific
countries. Delta's applications request operating
authority between the coterminal points of Atlanta,
Dallas/Ft. Worth, Houston, New Orleans, Miami/Ft.
Lauderdale, San Francisco/Oakland/San Jose, Los
Angeles/Long Beach and San Diego, and the
terminal point Manila, via Hawaii, Tokyo, Osaka,
Seoul and Hong Kong. An Examiner's recommended
decision last April did not favor grant of Delta's
application. The case has now been presented to the
full five-man Civil Aeronautics Board, however, and
Delta is continuing to prosecute its application vig-
orously. The international aspects of the case will be
submitted to the President for final approval,
which is expected during late 1968.
United States-Caribbean-South American Investi-
gation: This investigation involves air service needs
between the United States and points throughout
the Caribbean and South America. Delta seeks im-
provement of its existing Caribbean route authority
through use of Miami as a coterminal, along with
New Orleans and Houston, for its operations in the
14
1
Domestic and Caribbean Routes of
DELTA A IR LINES
1 9 6 8
15
Caribbean, and by adding Nassau. Delta is also seek-
ing authority to operate nonstop service between
West Coast points and Delta's Caribbean cities. An
Examiner's decision recommended grant of the latter
part of Delta's application. This case has now been
presented to the full CAB and final decision, which
also must be approved by the President before public
release, is expected at any time.
United States-Europe: Delta is an applicant in two
proceedings involving air service between the United
States and points in Europe. The first proceeding
is known as the Miami-London Route Investigation,
and will result in the authorization of one or more
U.S. Flag carriers to operate between those two cities.
The second proceeding involves service between
Boston, Hartford, Philadelphia, Baltimore and
Washington in this country, and points in smaller
European countries such as Norway, Sweden,
Denmark, Finland, the Netherlands, Belgium,
Switzerland.and Austria. These proceedings are in
preliminary stages and decision is not expected for
eighteen months to two years.
Gulf States-Midwest Points Service Investigation:
This proceeding involves north-south air service in
the mid-United States, including competitive service
in markets now served by Delta. The primary markets
under consideration are Dallas/Ft. Worth-Kansas
City, Dallas/Ft. Worth-St. Louis, Chicago-San
Antonio, Detroit-San Antonio, Chicago-Nashville,
Chicago-New Orleans, Chicago-Memphis, St. Louis-
Houston and New Orleans-Memphis, via various
intermediate points. Delta is seeking new authority
in the first ,six markets listed, and also seeks the
addition of new intermediate cities in some of the
other four markets. On August 1, the CAB Hearing
Examiner recommended new direct authority for
Delta between Dallas/Ft. Worth and Detroit, with a
permissible intermediate stop on any such flight at
Louisville, Indianapolis, Cincinnati or Cleveland, and
also additional operating authority between Chicago
and New Orleans, with a permissible intermediate
16
stop at Cincinnati, Little Rock, Huntsville or
Birmingham. The Examiner also recommended
competitive services (generally by only one carrier)
in many of the markets already served by Delta.
Proposals which could result in unnecessary duplica-
tion of existing services will continue to be resisted.
A final decision by the CAB probably will be forth-
coming sometime in 196 9.
Reopened Pacific Northwest-Southwest Service
Investigation: Delta is seeking authority between its
present system (in particular, New Orleans, Houston
and Dallas/Ft. Worth) and the cities of Denver and
Salt Lake City. An Examiner's initial decision did not
recommend grant of Delta's application, but the
Company has vigorously presented its case to the
full five-man CAB. Decision is expected at any time.
Southern Tier Cases: In four separate, but over-
lapping, cases the CAB is considering the need for
competitive air services in a number of markets
across the southern tier of states, from Florida and
Georgia in the East to California in the West.
In the Dallas/Ft. Worth-Phoenix Case, Delta is a
leading applicant. The case has now been submitted
to the Examiner for decision. Grant of Delta's
, application would enable it to operate between
Phoenix and Dallas/Ft. Worth, as well as cities east
thereof such as Atlanta, New Orleans and Orlando.
The Service to Albuquerque Case involves air
service between that New Mexico city and the cities
of Dallas/Ft. Worth, Las Vegas, San Francisco/
Oakland, Los Angeles/Long Beach and Chicago.
Delta is an applicant for authority in each of these
markets except Albuquerque-Chicago. Grant of
Delta's application would permit it to serve the local
market and also such markets as Albuquerque-
Material Services personnel control and supply
the more than 100,000 inventory items required
to support daily operations of the airline.
Atlanta, New Orleans, Orlando and Charlotte (via
Dallas/Ft. Worth), and to serve Albuquerque as an
intermediate point on Delta's southern transconti-
nental services.
The third case involves nonstop service between
Los Angeles and Memphis, Huntsville and Bir-
mingham. Delta already holds authority between
Birmingham and Los Angeles and is resisting the
certification of another carrier in that market. Delta
is seeking nonstop authority to compete with
American in the much larger Memphis-Los Angeles
market, and is also seeking authority to connect
Huntsville and Los Angeles, thereby meeting one of
the country's major, unfulfilled National Defense
needs for one-carrier air transportation.
The largest of these cases is the Southern Tier
Competitive Nonstop Service Investigation. The CAB
is here considering the possible need for competitive
services in a number of the markets in which service
was established for the first time in 19 61 in the
Southern Transcontinental Service Case, at which
time Delta was extended to the West Coast. The
markets at issue include a number served by
National Airlines, such as Miami-Los Angeles,
Miami-San Francisco and Houston-San Francisco,
and a number served by Delta, such as Atlanta-
Dallas/Ft. Worth, Atlanta-Los Angeles and Atlanta-
San Francisco. Delta has taken the position that it
is premature to authorize competitive service in such
of those markets as were first certificated for single-
carrier service as recently as 1961, including both
those served by Delta and those served by National.
Delta has also presented a strong case, however,
to show that it is the carrier which could best serve
such markets as Miami-Los Angeles if the CAB does
The growing use of computers to provide ex-
panding information services to all departments
offers new challenges and opportunities in pro-
gramming, operations, and systems design.
in fact certificate competitive service. Another part
of the case includes Texas-Florida markets, for
which Delta is an applicant.
Briefs have been filed with the Examiners in all
of these cases and final CAB decisions are expected
in 1969.
Twin Cities-California Investigation: This proceed-
ing involves nonstop service between Minneapolis/
St. Paul, on the one hand, and Los Angeles and
San Francisco, on the other hand. The Hearing
Examiner's initial decision did not recommend grant
of Delta's application, but the proceeding has now
been reviewed by the CAB and is awaiting its
decision in the near future.
Other Matters: Delta is also involved in a number
of other route proceedings before the CAB, including
the Bermuda Service Investigation and the Service to
Omaha and Des Moines Case, in both of which Delta
is an applicant, and a number of local services
proceedings in which Delta's primary role is to
protect its traffic from erosion through the grant of
uneconomic authority to the smaller carriers. The
CAB has also instituted a number of additional cases
in which final procedural steps have not yet been
established, but in which Delta will be an active
participant, including the Additional Service to
Augusta and Columbia Case (Augusta/Columbia-
Washington-New York), the North Carolina Points
Service Investigation ( Charlotte/Raleigh-Durham/
Greensboro-High Point-Winston-Salem to Chicago,
Miami and New York), and the Houston-Cleveland
Service Investigation.
The fiscal year has seen unusually heavy activity
in CAB route proceedings, with a number of new
proceedings added to the many which were instituted
during 1967.
These CAB cases hold promise for expansion
of Delta's domestic and international route authority,
but also involve CAB consideration of additional
operating authorization for other carriers in areas
already served by Delta.
19
BALANCE SHEETS June 30, 1968 and 1967
ASSETS
CURRENT ASSETS:
Cash ....... . ... . ................. . .... . ... . .
Short-term cash investments, at cost ................ .
Accounts and notes receivable . . . . . . . . . . . . . . . . . . . . . .
Maintenance and operating supplies, at average cost
Prepaid expenses, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current assets .. ... . ......... . . .
PROPERTY AND EQUIPMENT:
Cost-
1968 ..... . ...... . . .
1967 ........... . .. .
Accumulated depreciation-
1968 .............. .
1967 . .... . ........ .
Flight
Equipment
Other
Property and
Equipment
$465,450,000 $61,919,000
383,268,000 50,178,000
153,601,000
156,529,000
24,690,000
20,306,000
Advance payments for new flight equipment . . . . .
$
1968
17,972,000
16,019,000
36,010,000
4,330,000
1,214,000
75,545,000
527,369,000
178,291,000
349,078,000
40,848,000
389,926,000
DELTA AIR LINES, INC.
$
1967
7,888,000
32,830,000
24,920,000
3,435,000
1,958,000
71,031,000
433,446,000
176,835,000
256,611,000
41,780,000
298,391,000
ADVANCE FOR SST DEVELOPMENT, being amortized 2,778,000
$468,249,000 $369,422,000
20
LIABILITIES AND STOCKHOLDER EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt ...... . .. .. ..... .
Accounts payable and accrued liabilities . . . . . . . . . . . . . .
Tickets outstanding subject to refund or use . . . . . . . . . . .
Air travel plan deposits . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current liabilities .. .. . . . .. . ..... .
LONG-TERM DEBT (Note 1) . . . . .. . ........ . .. .. .. .
DEFERRED CREDITS:
Deferred Federal income taxes . . .... . .. ..... . . ... . .
Unamortized investment tax credit (Note 3) . ... . . . . .. .
STOCKHOLDER EQUITY:
Common stock, par value $3.00 per share (Note 6)-
Authorized 25,000,000 shares
Outstanding 19,125,000 . .. .. . ... . ... . ... .
Capital surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Retained earnings (of which $41,718,000 is restricted as
to the payment of cash dividends under terms of credit
agreements) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
COMMITMENTS (Note 2)
The accompanying notes are an integral part of these balance sheets.
$
1968
7,794,000
33,713,000
7,352,000
1,695,000
855,000
51,409,000
132,436,000
70,773,000
18,657,000
89,430,000
57,375,000
22,450,000
115,149,000
194,974,000
$
DELTA AIR LINES, INC.
1967
3,448,000
25,647,000
6,554,000
1,670,000
13,046,000
50,365,000
86,296,000
53,367,000
12,904,000
66,271,000
19,125,000
22,450,000
124,915,000
166,490,000
$468,249,000 $369,422,000
21
STATEMENTS OF INCOME for the years ended June 30, 1968 and 1967 DELTA AIR LINES, INC.
22
1968 1967
OPERATING REVENUES:
Passenger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $396,793,000 $362,368,000
Cargo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,141,000 31,638,000
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,628,000 3,830,000
Total operating revenues . . . . . . . . . . . . . . . . . . . . . . . . 431,562,000 397,836,000
OPERATING EXPENSES:
Flying operations . . . . . . . . . . . . . . . . . . . . . . . . . .
Maintenance (Note 5) ............ .. ...... . . .
Aircraft and traffic servicing . . . . . . . . . . . . . . . . . . . . . . .
Promotion and sales . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization (straight-line method) . . ..
Passenger service ...................... .. ... .
General and administrative . . . . . . . . . . . . . . . . . . . . . . . .
Total operating expenses ...... . ................ .
Income from operations before income taxes ........ .
OTHER EXPENSE (INCOME):
Interest expense (less capitalized interest on advances for
flight equipment-$1,763,000 in 1968 and $1,712,000
in 1967) .................................... .
Other-net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total other expense ......... .. ............ .
INCOME BEFORE INCOME TAXES ............. .
PROVISION FOR INCOME TAXES (Note 3) ....
NET INCOME, before gain on disposition of aircraft
GAIN ON DISPOSITION OF AIRCRAFT, less taxes ..
NET INCOME .. .. .... ... ........ ... . ......... . . .
PER COMMON SHARE:
Before gain on disposition of aircraft . . . . . . . . .
Gain on disposition of aircraft, less taxes . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The accompanying notes are an integral part of these statements.
95,409,000
64,992,000
68,719,000
45,416,000
40,568,000
38,940,000
9,096,000
363,140,000
68,422,000
5,198,000
(2,162,000)
3,036,000
65,386,000
29,487,000
35,899,000
235,000
$ 36,134,000
$1.88
.01
$1.89
$
81,175,000
60,781,000
57,099,000
39,067,000
30,847,000
31,326,000
8,442,000
308,737,000
89,099,000
3,453,000
(2,812,000)
641,000
88,458,000
41,670,000
46,788,000
2,402,000
49,190,000
$2.44
.13
$2.57
- -
STATEMENTS OF RETAINED EARNINGS for the years ended June 30, 1968 and 1967 DELTA AIR LINES, INC.
1968 1967
BALANCE AT BEGINNING OF YEAR . . . . . . . . . . . . . . $124,915,000 $ 82,100,000
Net inconie . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,134,000 49,190,000
161,049,000 131,290,000
Deduct:
Cash dividends 7,650,000 6,375,000
Transfer to common stock in connection with a 3-for-1
stock split on December 1, 1967 . . . . . . . . . . . . . . . . . . 38,250,000
BALANCE AT END OF YEAR ..................... $115,149,000 $124,915,000
STATEMENTS OF SOURCE AND DISPOSITION OF FUNDS for the years ended June 30, 1968 and 1967
FUNDS PROVIDED BY:
Net income .... .... .... ... . ... ................ .
Add non-cash expenses-
Depreciation and amortization . . . . . . . . . . . . . . . . . . . .
Deferred Federal income taxes . .. ... . . ... ... ... . .
Investment tax credit, net . . . . . . . . . . . . . . . . . . . . . . . .
Engine overhaul reserves, etc. . . .. . . . . . .. . ...... .
Total from operations . . . . . . . . . . . . . . . . . . . . . . . .
Additional financing under-
Installment purchase agreements . . . . . . . . . . . . . . . . . .
Bank credit agreement . . . . . . . . . . . . . . . . . . . . . . . . . .
FUNDS USED FOR:
Flight equipment additions, including advances .. . .. . . . .
Other property and equipment additions . . . . . . . . . . . . . .
Advance for SST development . . . . . . . . . . . . . . . . . . . . . .
Reduction of long-term debt ...................... .
Cash dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
INCREASE (DECREASE) IN WORKING CAPITAL
WORKING CAPITAL AT END OF YEAR
The accompanying notes are an integral part of these statements.
1968
$ 36,134,000
40,568,000
17,406,000
5,753,000
(5,003,000)
94,858,000
6,786,000
50,000,000
151,644,000
114,520,000
12,358,000
3,000,000
129,878,000
10,646,000
7,650,000
148,174,000
$ 3,470,000
1967
$ 49,190,000
30,847,000
8,476,000
3,252,000
2,989,000
94,754,000
1,482,000
96,236,000
98,901,000
6,626,000
105,527,000
3,538,000
6,375,000
115,440,000
$ (19,204,000)
$ 24,136,000 $ 20,666,000
23
NOTES TO FINANCIAL STATEMENTS June 30, 1968
1. LONG-TERM DEBT:
At June 30, 1968, the Company's long-term debt of $140.2
million (including current maturities) consisted of the fol-
lowing:
(a) $95 million due banks under a credit agreement which
provides for borrowings up to $175 million on a revolv-
ing basis to December 31, 1969, at which time the out-
standing balance will be converted to a 5-year term
loan. Loans under the agreement are unsec1ued and
carry an interest rate of % above the prime rate,
(b) $33.7 million due insurance companies under 6% un-
secured notes repayable in installments to October, 1974
( $2.5 million payable in fiscal 1969),
( c) $ 8. 7 million due the manufacturer of the Deltamatic
Reservation System repayable in quarterly installments
(including 4 % interest) of $704,000, and
( d) $2.8 million due in fiscal 1969 under a conditional sales
contract covering the purchase of a Douglas DC-8 jet
aircraft.
2. COMMITMENTS:
The Company has outstanding purchase commitments for
the acquisition of eight Douglas DC-8 jet aircraft, thirty-five
Douglas DC-9 jet aircraft, five Boeing 747 jet aircraft and
twenty-four Lockheed L-1011 aircraft which will require an
expenditure of approximately $609 million during the fiscal
years 1969 through 1975.
The Company leases certain airport facilities, ticket offices,
etc., under long-term agreements. Minimum annual rentals
are approximately $4,700,000 under such leases expiring
after June 30, 1971.
AUDITORS' REPORT
DELTA AIR LINES, INC.
3. PROVISION FOR INCOME TAXES:
The provision for income taxes for 1968 and 1967 consists
of the following:
Current income taxes
Deferred Federal
income taxes
Investment tax credit
Less-Amortization of
investment tax credit
over life of related
equipment . ..
1968
$ 6,328,000
17,406,000
8,882,000
32,616,000
3,129,000
$29,487,000
1967
$29,942,000
8,476,000
5,474,000
43,892,000
2,222,000
$41,670,000
All available investment tax credits have been utilized to re-
duce the Company's Federal income taxes payable.
4. PENSION PLANS:
The Company has noncontributory pension plans covering
substantially all of its employees. The total pension expense
amounted to $5 .8 million in 1968. All prior service costs
under the plans are fully funded, and it is the Company's
policy to fund each year's accrued pension cost.
5. ENGINE OVERHAUL RESERVES:
As a result of significant improvements in the engine over-
haul and maintenance programs on its expanded jet fleet,
the Company discontinued the practice of providing engine
overhaul reserves. Accordingly, reserves of $4.2 million
were eliminated. This change in practice had the effect of
increasing 1968 net income by $2.1 million or 11 per
common share.
6. STOCK OPTIONS:
In October, 1967, the Company's stockholders approved a
qualified stock option plan for an aggregate of 100,000 shares
of common stock, under which options for 50,000 shares
have been granted at a price of $31.125 per share. None of
the options were exercisable at June 30, 1968.
ARTHUR ANDERSEN & Co.
24
To the Stockholders and Board of Directors of
Delta Air Lines, Inc.:
ATLANTA, GEORGIA
We have examined the balance sheet of Delta Air Lines, Inc. (a Delaware corporation) as of June 30, 1968, and the
related statements of income, retained earnings and source and disposition of funds for the year then ended. Our examina-
tion was made in accordance with generally accepted auditing standards, and accordingly included such tests of the
accounting records and such other auditing procedures as we considered necessary in the circumstances. We have previously
examined and reported on the financial statements for the preceding year.
In our opinion, the financial statements referred to above present fairly the financial position of Delta Air Lines, Inc.
as of June 30, 1968, and the results of its operations and the source and disposition of funds for the year then ended, in
conformity with generally accepted accounting principles which were applied, other than for the elimination of engine
overhaul reserves as explained in Note 5 to the financial statements, on a basis consistent with that of the preceding year.
Atlanta, Georgia,
August 14, 1968.
A craftsmanship produced by years of experience goes into
the overhaul of the engines that power Delta's big jets.
REVENUE PASSENGERS CARRIED
(In Millions)
REVENUE PASSENGER MILES
(In Billions )
12 - - - - - - - - - - -
11 ~ - - - - - - - - --
10 -----------
10 - - - - - - - - -----1-
9 - - - - - - - -----1~---
8 - - - - - - - -----1~---
7 - - - - - - ---1~~--
6 - ~ - - - - - - - , ,~ ~ ~ - -
5 - - - - ---ta-la---1~~--
4
--------11---.-.a------1a------1~---
3 -=---t--111-11-------.-ta------la------l~--
2 --~1---111-11 .........
---.-.a------1a------1~--
0 _.__.__.__~~~L...aL...a.__.L_
9 - -Jet
8 - - Piston
5
4
3
0
-

--

10 YEARS OF DELTA AIR LINES GROWTH Years Ended June 30
(Dollars expressed in thousands except per share figures)
Operating revenues
Passenger . '
.... . . .. .... .. . . '
.. ' '
' . '
........... . .. '
.. .
Mail ............... ' '
.... '
.. . ... . . .. ' '
... .... . .. '
.. .
Freight . '
... '
. . . ... . ... '
... '
... ' ' . '
. .. .. . ............
Express
o ' o ' o o ' I o o o o o o , o o , o , , o o o o I o , o . o o o o
All other ... ..... '
. . .... .... '
.......... . ...... . .. ... ..
Total operating revenues . . : . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses . .. . '
. ..... '
.. '
......
'
.. .. .... .. ...... '
..
Operating income ... ' ' . '
. . '
... . .. '
.... '
. . ......... .. .......
Other expense-net .. . .... '
. .... '
. . . .. '
. ... ... . .. ... . ... ...
Net income before taxes ... ....... . ... .. . .... ........ ... . ....
Taxes on income . .....
'
........... '
............... . '
...
Net income before gain on disposition of aircraft . .. ...............
Gain on disposition of aircraft, less taxes . . . . . . . . . . . . . . . . . . . . . . . .
Net income .. . .............. . . . ............ '
.... '
.. .......
Per share of stock outstanding at year end*
Before gain on disposition of aircraft . . . . . . . . . . . . . . . . ...
Gain on disposition of aircraft, less taxes .. .... . .........
Net income . ....... ... .. . .. .. . '
..... '
.. '
... .......
Dividends paid .. .. . ... .... .. ....... .. .. ............. .
Dividends paid per share* ..... . .......... . .... ...... ' ' . '
Total assets ...... . .... .... . ...... . .. ...... .. .. .. . .........
Stockholder equity ...... ... '
.... '
. . .. ... '
. . ........ '
....
Stockholder equity per share* ... . .... ....... .. ........ .. .... ..
Shares of common stock outstanding at year end* ..... .... . '
... . .
Revenue' passengers carried .. '
. .... .. ..... .. ... . ... '
....
Revenue plane miles ( 000) .. . .... .
. . . . . . . . . . . . . . . . . . . . . . . . . .
Available seat miles (000) . ...... . .... ,
.......... ... .
Revenue passenger miles ( 000) ......... . . ... .... . ..
Passenger load factor . '
. . . .
. . . . . . . . . . . . . . . . . . . . . . .
. . . . .
Available ton miles (000) .. '
... . .. .... '
... . . ...... . . ..... ...
Revenue ton miles ( 000) . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . ' '
. . .
Passenger revenue per passenger mile . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses per available seat mile . . . . . . . . . . . . . . . . . . ....
Operating expenses per available ton mile . . ... .. . .. . .. ..........
*Adjusted to reflect all stock splits through June 30, 1968
'26
1968
$396,793
11,142
17,511
3,488
2,628
$431,562
363,140
$ 68,422
3,036
$ 65,386
29,487
$ 35,899
235
$ 36,134
$1.88
.01
$1.89
$ 7,650
$0.40
$468,249
$194,974
$10.19
19,125,000
10,368,831
116,386
11,972,737
7,116,095
59.44%
1,609,704
814,782
5.58
3.03
22.56
OPERATING REVENUES & EXPENSES
(In Millions of Dollars)
500 -----------
450
= -
Operating Revenues
-------1---
400 - - Operating Expenses ---...----11---
350 - - - - - - - -- -
300 - - - - - - -------
250 - - - - - -- -
200 -------
150 ----
100 - - - ,... ,_ ,_ - - - - -
50=(=-,...:::::::
0-'=~ -- ~ ~~ - - - -
~ W ~ ~ ~ M ~ ~ ~ ~
1967 1966
$362,368 $291,350
11,044 6,926
16,840 13,902
3,754 3,211
3,830 3,541
$397,836 $318,930
308,737 253,092
$ 89,099 $ 65,838
641 1,676
$ 88,458 $ 64,162
41,670 30,170
$ 46,788 $ 33,992
2,402 562
$ 49,190 $ 34,554
$2.44 $1.78
.13 .03
$2.57 $1.81
$ 6,375 $ 6,056
$0.33 $0.32
$369,422 $314,350
$166,490 $123,675
$8.71 $6.47
19,125,000 19,125,000
9,422,422 7,556,422
100,270 84,835
9,687,337 8,196,349
6,415,467 4,997,958
66.23% 60.98%
1,304,889 1,090,282
735,898 569,625
. 5.65 5.83
3.16 3.06
23.66 23.21
FLIGHT EQUIPMENT
(In Millions of Dollars)
500 - - - - - - - - - - -
450
400
350
300
250
200
150
100
- Cost
- (Jet aircraft)
{ Net Book Value - -
- r- c--
- Depreciation
- --
= { Net Book Value
=-;-:
Cost
-(Piston aircraft) - Depreciation - r- r-
- - 1- .--
-
50
0


I
I
I
1965
$234,036
5,176
11,616
2,828
3,804
$257,460
213,131
$ 44,329
1,875
$ 42,454
20,051
$ 22,403
602
$ 23,005
$1.17
.03
$1.20
$ 4,845
$0.25
$231,274
$ 95,177
$4.98
19,125,000
5,964,269
73,664
6,793,654
3,855,012
56.74%
907,014
442,239
6.07
3.12
23.50
-
....
....
,..
...
.
1964
$205,346
4,299
8,869
2,396
3,762
$224,672
189,871
$ 34,801
2,584
$ 32,217
16,523
$ 15,694
$ 15,694
$0.82
$0.82
$ 3,570
$0.19
$194,241
$ 77,017
$4.03
19,125,000
5,233,548
65,815
5,582,349
3,353,842
60.08%
740,852
378,465
6.12
3.38
25.63
--
r-- -
r-- c--
,.... _
EARNINGS PER SHARE*
(In Dollars)
3.00 - - - - - - - - - - -
- - Earnings from
2_
50 _ Operations
F"'
_ - Gain on Disposition ;
of Aircraft
I'
2.00 -
- Estimated Benefits
- from Strike of
1.50
Five Competitors
-
1.00
.50
-
0

1963 1962 1961
$191,355 $155,994 $134,946
4,483 3,414 2,579
8,305 5,814 4,070
2,280 1,669 1,408
3,650 2,886 3,129
$210,073 $169,777 $146,132
177,622 154,671 134,431
$ 32,451 $ 15,106 $ 11,701
3,155 2,862 2,733
$ 29,296 $ 12,244 $ 8,968
15,472 6,579 4,842
$ 13,824 $ 5,665 $ 4,126
1,320 526
$ 13,824 $ 6,985 $ 4,652
$0.72 $0.30 $0.25
.07 .03
$0.72 $0.37 $0.28
$ 2,550 $ 1,520 $ 1,346
$0.13 $0.08 $0.08
$181,433 $158,088 $134,938
$ 64,893 $ 53,619 $ 41,056
$3.39 $2.80 $2.44
19,125,000 19,125,000 16,833,516
4,606,367 3,768,707 3,569,778
61,242 55,713 49,455 .
4,953,787 4,123,318 3,389,547
3,004,157 2,393,991 2,034,047
60.64% 58.06% 60.01 %
648,185 542,232 442,251
342,661 269,044 223,592
6.37 6.52 6.63
3.56 3.74 3.95
27.40 28.52 30.40
STOCKHOLDER EQUITY PER SHARE*
(In Dollars)
12 - - - - - - - - - - -
11 -----------
10
9
8
7
6
5
4
3
2
0
-
-
-
-
-
1960
$109,672
2,140
4,250
1,362
2,767
$120,191
113,460
$ 6,731
1,313
$ 5,418
2,735
$ 2,683
156
$ 2,839
$0.16
.01
$0.17
$ 1,346
$0.08
$121,890
$ 38,902
$2.31
16,833,504
3,241,511
49,405
3,027,450
1,757,208
58.04%
387,552
195,373
6.24
3.74
29.28
1959
$ 94,062
2,152
3,879
1,206
2,506
$103,805
94,420
$ 9,385
554
$ 8,831
4,769
$ 4,062
$ 4,062
$0.24
$0.24
$ 673
$0.04
$ 95,427
$ 37,410
$2.22
16,833,324
2,988,241
46,022
2,622,740
1,554,630
59.28%
324,018
174,936
6.05
3.58
29.14
'27
BOARD OF DIRECTORS R. W. FREEMAN
W. T.BEEBE
B. W. BIEDENHARN
R. W. COURTS
C.H. DOLSON
EMERY FLINN
EDWARD H. GERRY
CHARLESH.KELLSTADT
JOHN R. LONGMIRE
R.S.MAURER
T. M. MILLER
DELTA AIR LINES, INC.
Chairman of the Finance Committee,
New Orleans, Louisiana
Atlanta, Georgia
Monroe, Louisiana
Atlanta, Georgia
Atlanta, Georgia
Miami, Florida
New York, New York
Miami, Florida
St. Louis, Missouri
Atlanta, Georgia
Atlanta, Georgia
WINSHIP NUNNALLY Atlanta, Georgia
CARLETON PUTNAM Washington, D. C.
GEORGE M. SNELLINGS, JR. Monroe, Louisiana
OFFICERS C.H.DOLSON
Administration
W. T.BEEBE
R. W.ALLEN
R: H. WHARTON
Finance
ROBERT OPPENLANDER
PAULW.PATE
W. A. ATCHISON
M. 0. GALLOWAY
J.R.HOWELL
HUGH H. SAXON
Legal
R. S. MAURER
ROBERTL. GRIFFITH
J.A. COOPER
MORRIS SHIPLEY
Marketing
T. M. MILLER
SHELBY D. DEMENT
CHARLES P. KNECHT
J. W. MEYER
Operations
DAVID C. GARRETT, JR.
T. P. BALL
JACKS. KING
L. G. RODEFELD
C.B. WILDER
TRANSFER AGENTS: The Citizens & Southern National Bank, Atlanta, Georgia
and The First National City Bank, New York City
REGISTRARS: Trust Company of Georgia, Atlanta, Georgia
and Morgan Guaranty Trust Company of New York, New York City
COMMON STOCK: Listed on the New York Stock Exchange
AUDITORS; Arthur Andersen & Co.
ANNUAL MEETING: October 24, 1968, Monroe, Louisiana
28
President
Senior Vice President-Administration
Assistant Vice President-Administration
Assistant Vice President-Personnel
Senior Vice President-Finance and Treasurer
Vice President-Properties
Assistant Vice President-Computer Services
Assistant Vice President-Comptroller
Assistant Treasurer
Assistant Treasurer
Senior Vice President-General Counsel and Secretary
Vice President-Federal Affairs
Assistant Vice President-Economic Research
Assistant Vice President-Civic Affairs
Senior Vice President-Marketing
Assistant Vice President-Traffic and Sales
Assistant Vice President-Sales
Assistant Vice President-Customer Relations
Senior Vice President-Operations
Assistant Vice President-Flight Operations
Assistant Vice President-Flight Control
Assistant Vice President-Communications
Assistant Vice President-Technical Operations
The friendly service offered by the stewardess is
an important part of our total effort to produce the
finest in jet service for the traveling public.
DELTA AIR LINES, INC., GENERAL OFFICES, ATLANTA AIRPORT, ATLANTA, GEORGIA 30320