Delta's 1969 Annual Report has been produced in this unconventional pocket-sized edition for the convenience of our stockholders. Although small in size, the report provides a concise and _ comprehensive review of 1969 financial and operational results. $3.00 - 2.50 - 2.00 - 1.50 - 1.00 - .50 - EARNINGS PER SHARE RETURN ON INVESTMENT Estimated Influence of Competitors' Strike and Extraordinary Gain on Disposition of Flight Equipment. 65 Highlights of the Year - 50 - 30 - 20 10 67 69 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. Per Cent 1969 1968 Change Operating Revenues $516,113 $431,562 + 20% Operating Expenses $433,938 $363,140 + 19 Net Income $ 39,191 $ 36,134 + 8 Earnings Per Share $2.05 $1.89 + 8 Revenue Passengers Carried ..... 12,107,061 10,368,831 + 17 Available Seat Miles (000) 14,768,892 11,972,737 + 23 Revenue Passenger Miles (000) 8,249,085 7,116,095 + 16 Passenger Load Factor 55.85% 59.44% - 6 2 REPORT TO THE STOCKHOLDERS Fiscal 1969 was a most gratifying year for Delta under generally difficult circumstances for the airline industry. New highs recorded include $516.1 million operating revenues, 8.25 billion revenue passenger miles, and 178.6 million cargo ton miles. Net earnings of $39.2 million or $2.05 per share were 8% above fiscal 1968 despite the full impact of the 10% surtax and the accelerated inroads of inflation on operating expenses. Deliveries of additional Super DC-8 and Super DC-9 aircraft, together with the pur- chase of five standard DC-8 aircraft, per- mitted a 30% expansion in jet capacity and the virtual elimination of piston services at year-end. The only piston services now re- maining are to those few communities where the expansion of airport facilities to accom- modate DC-9 service will not be completed until late 1969. No substantial additions were made to the long range equipment plans during the year. Shortly after the close of the year, commit- ments for the purchase of two standard DC-8 and one standard DC-9 aircraft were made to cover requirements on new route awards. The estimated future capital outlays for flight equipment to be delivered through 197 5 totals $4 7 5 million. Financing will be pro- vided from internally generated funds and proceeds from the 1967 Bank Credit Agree- ment which was amended during the year to increase the total amount available from $17 5 million to $220 million. Further details of the year's operating results and other significant data are con- tained in the following sections. 800/o----------------,-------. 70 - 60 50 40 30 61 ACTUAL AND BREAK-EVIN, LOAD PACTOR Estimated Influence of Competitors' Strike 63 65 67 69 3 600/o- - ~ ~ - - ~ ~ ~ - - - - - - - - - -----,, 8.00 PROPORTION OF PASSENGER MILES AT DISCOUNT FARES 50 PASSENGER MILE YIELD 40 - 30 - 20 - 10 - 4 0 L 65 I 66 Revenues and Expenses 67 Operating revenues established a new high of $516.1 million, an increase of 20% over 1968. Other new highs were in revenue passenger miles of 8.25 billion, passenger revenues of $4 70.0 million and in cargo ton miles of 178.6 million, the latter up 31 % over the previous year. After seven successive years of decline, the passenger mile yield was up 2% to 5.70. This increase resulted from the fare rounding effective February, 1968; from the fare increase approved by the CAB effective February 20, 1969, estimated to add 3.8% to industry revenues; and from a continued stabilizing of the proportion of discount fare travel. On June 1, 1969, the Discover America fares were revised to require a seven-day stay, which should improve yield by lowering the percentage of discount fare travel. 7.50 - 6.00 - 5.50 _J 5.00 69 6.00 - - - - - - - - - - - - ~ - - ~ - ~ ~ - 4.60 - 3.60 3.00 2.60 2.00 1.60 1.00 UNIT COST PER AVAILABLE SEAT MILE 61 63 65 67 Unfortunately, the favorable impact of these increases has been effectively offset by subsequent substantial increases in labor, fuel, material and other operating costs. Recent contract wage agreements reached by several of the major trunk carriers provide for annual wage and salary increases ap- proaching 10% (not including significant changes in fringe benefits) . Further fare and rate relief must be provided to the industry if it is to maintain its economic viability and regain the confidence of the investing public and lending institutions during a critical pe- riod of unprecedented capital requirements. Several carriers have recently approached the CAB for fare increases, concerning which Oral Argument was heard September 4, 1969. Operating expenses increased 19 % over 1968 to a total of $433.9 million, including 69 5 6 a 43 % increase in flight equipment deprecia- tion due to the major additions to the jet fleet. Operating capacity was up 23 % and, because of the substantial input of the more efficient Super DC-8 and DC-9 aircraft, unit costs were again down to new lows. Avail- able ton mile costs were down 4 % and avail- able seat mile costs declined 3 % despite the effect of accelerated inflation on all areas of operations. Fiscal 1970 unit costs will be very heavily influenced by the success or failure of current efforts to reduce inflation. Earnings and Dividends Net earnings were $39.2 million, or $2.05 per share, an 8 % increase over the $1.89 per share earned in fiscal 1968. The current year earnings included a fare increase be- ginning in February and the full impact of the 10% surtax, while 1968 earnings were increased 11 per share by the overhaul reserve adjustment recorded in that year and included only partial effectiveness of the surtax. Both years included 1 per share net gain on the disposition of aircraft and other property. Aggregate dividend payments for the year were $7,650,000 or 40 per share on the 19,125,000 shares outstanding. This was the twentieth consecutive year of cash dividend payments. Flight Equipment During the last fiscal year, Delta accepted delivery of five Super DC-8's, twenty-seven Super DC-9's, and five standard DC-8's. The standard DC-8's were purchased from Pan American Airways primarily for the opera- tion of interchange flights to Europe, includ- ing a new round-trip from the Southeast to Paris beginning in February, 1969. In July, 1969, one standard DC-9 was purchased upon expiration of a short-term lease and purchase commitments for two additional standard DC-8's were made to cover require- ments for new route awards explained in another section of this report. The last outstanding options were exer- cised during the year for 1970 delivery of five Super DC-9's. The following table shows the pattern of deliveries for all aircraft currently on order: Type Fleet Deliveries in Fiscal Years Fleet of Total Total Aircraft Seats 6/30/69 '70 '71 '72 '73 '74 '75 6/30 /75 DC-8 129 5 2 7 DC-8 135 21 21 DC-8 195 10 3 13 DC-9 68 15 15 DC-9 89 49 9 58 CV-880 96 16 16 B-747 375 3 2 5 L-1011 250 5 6 6 7 24 L-100-20 Cargo 3 3 - - - 119 14 3 7 6 6 7 162 7 8 The substantial additions of Super DC-9's permitted the retirement of most of the re- maining piston fleet. The DC-6 phase-out was completed in September and the aircraft sold. A minimum of CV-440's were operat- ing at year-end and retirement should be completed by the end of calendar 1969. Facilities The expansion and improvement of ground facilities to meet the needs of normal growth and to accommodate the Boeing 7 4 7 and Lockheed L-1011 aircraft continued at an accelerated pace during the year. New air- ports were completed and occupied at Jacksonville and Houston. New or expanded airport projects are underway in Atlanta, Chicago, Cincinnati, Dallas/Ft. Worth, Detroit, Kansas City, Memphis, New Or- leans, New York, Philadelphia, and Tampa. Construction or final planning of necessary modifications is progressing at all airports now scheduled for B-7 4 7 and L-1011 service. Numerous other new or expanded facilities were completed, including a second level concourse in Jackson, a new ticketing facility at Dallas Love Field, and reservations offices in Jacksonville and Jackson. Construction should be completed by late 1969 on the new Flight Training, Communications, Flight Control and Reservations facilities located on a 60-acre site at Greenbriar in Atlanta. The Flight Training facility will house the new DC-8 and DC-9 simulators to be in- stalled in August and includes provisions for an L-1011 simulator now on order for delivery in August, 1971. 9 10 Capitalization and Financing In April, 1969 Delta amended the 1967 Bank Credit Agreement to increase the total funds available by $45 million to $220 million and to extend the revolving period by one year through calendar 1970 and the subsequent term loan through 197 5. The additional amount was required to purchase the five standard DC-S's and to meet certain periodic peakings of cash requirements. A total of $185 million had been borrowed as of June 30, 1969. Delta's current outstanding orders for new jet aircraft will involve probable future capital outlays in excess of $4 7 5 million. The amended bank credit agreement together with normal internal cash generation from earnings, depreciation, and deferred taxes are currently estimated to be adequate for the projected capital requirements. Stockholder equity at June 30, 1969 was $226,515,000 or $11.84 per share on the 19,125,000 shares outstanding. This repre- sents an increase of 16% over the $10.19 per share at June 30, 1968. Personnel Employees at year end totaled more than 18,700. Including the added employees, total salaries and related employee benefit costs increased 19. 6 % to $201 million, equal to 39 cents of each revenue dollar or the same proportion as in fiscal 1968. Consistent with Delta's commitment to development and promotion from within the company, twelve new Assistant Vice Presi- dents were named during the year. These were J. K. Burnette, Quality Control; J. W. Callison, Law; J. D. Dunn, Purchasing; A. C. Ford, Long Range Planning; E. L. Hamner, Stations; D. P. Hettermann, Engineering; W. L. Miller, Materiel Services; J. F. Nycum, Flight Equipment Develop- ment; Henry Ross, Advertising & Sales Promotion; Frank F. Rox, Law; J. H. Turner, Maintenance; and J. A. York, Employee Services. The experience with Delta of these gentlemen totals 2 7 8 years or an average of more than 23 years each. At the annual meeting of stockholders on October 24, 1968, two new members, both senior officers of the Company, were added to the Board of Directors. David C. Garrett, Jr., Senior Vice President-Operations, is a twenty-two year veteran with the Company and was first elected a Company officer in 1963. Robert Oppenlander, Senior Vice President-Finance and Treasurer, joined Delta in 19 5 8 and was promoted to his pres- ent position in 1967. 11 12 Regulatory Matters The unusually large backlog of CAB route proceedings at the beginning of the year had expanded even more by year-end. Several major decisions have been recently an- nounced and, because of the importance of these decisions and proceedings still pending to Delta's future, each of these are reported in a separate section of this report. Outlook In our 1968 report to you, we expressed our belief that fiscal 1969 would reflect a reasonable earnings growth "even in the shadows of continuing inflationary pressures and the full impact of the 10% surtax". Our assessment of fiscal 1970 is much the same. Added capacity will continue at a high rate for the first half of the fiscal year but will moderate in the last half as deliveries of the DC-8 and DC-9 aircraft are com- pleted. Barring a major economic downturn, traffic growth should be comparable to recent experience and the decline in load factor should begin to level in the last half. This decline will be offset by an expected 3 % increase in yield due to the February fare increase. The additional fare increase proposals by several carriers, if approved, will provide additional leverage for the coming year. Unit costs will tend to level because of recent increases in wage rates and the costs of fuel and materials. Even so, some earnings growth is expected. You can be particularly proud of the unique record achieved by Delta during this most difficult period for the industry. We gratefully acknowledge your support and that of each of our employees whose com- bined efforts have made it all possible. C.H. DOLSON, President September 8, 1969 13 The Routes of Delta Air Lines Originally a pioneer trunkline serving the South, Delta's growth and development, based on the highest standard of service and dependability, have produced a route system which plays an increasingly important role in the Nation's transportation network. The map below is a graphic representation of the major traffic flow patterns of the Legend - East-West - Midwest-Southeast - Midwest-Gulf States - Northeast-Gulf States Delta system. Serving the industrial centers of the East and Midwest, the principal growth areas of the South and Southwest, the dynamic West Coast and the vacation spots in Florida and the Caribbean, Delta is prepared for full participation in the opportunities for further growth and development. 14 15 16 Regulatory Matters The unusually heavy activity in CAB route cases continued during the fiscal year, hold- ing both the promise of system expansion and the prospect of additional competition. In the Gulf States and Route 81 cases, the Board granted Delta an alternative Chicago- New Orleans route via Nash ville and Birmingham, terminated the Company's Hot Springs authority, and authorized competition in several of the Company's markets, including Chicago-Memphis, Chicago-New Orleans, Memphis-New Orleans, Houston-St. Louis and Memphis- St. Louis. Chicago-Nashville and Chicago- Birmingham services were inaugurated August 1, 1969, and Nashville-New Orleans services were inaugurated September 8, 1969. Delta also has an application on file for Nash ville-Detroit authority ( not yet set down for hearing) and, in another pending case, is seeking Nashville-Atlanta rights. Southern Tier Cases: In four separate but overlapping cases involving the southern tier of states, the Board granted Delta (a) Miami- San Francisco, (b) Miami-Houston, and (c) Dallas-Phoenix authority (with the right to operate Phoenix-southeast services via Dallas) . Competition was authorized in a number of present Delta markets, including Atlanta-Dallas and Atlanta-Los Angeles/ San Francisco. These new authorities are slated to become effective September 23, 1969, subject to reconsideration by the CAB of its decision. ~ In the United States-Caribbean-South America Case, Delta was granted nonstop rights between California and the Caribbean points it serves-San Juan, Caracas and Montego Bay (plus Maracaibo, Venezuela which currently cannot be served). Addi- tional competition was authorized between San Juan and Jamaica; New Orleans/ Houston and Caracas; and, on a one-stop basis, California and Jamaica. Subsequently, Delta filed a Chicago-Atlanta-} amaica ap- plication, which has not yet been processed. 17 18 CHIC --- ALEIGH/ URHAM In the North Carolina Points Service Investi- gation, the Board's Bureau of Operating Rights recommended that Delta be granted (a) authority between New York and both Greensboro/High Point/Winston-Salem and Raleigh/Durham (the two areas could also be served across the southern tier of states through Delta's Charlotte gateway) and (b) authority between Miami and the North Carolina cities ( including Charlotte) . Delta seeks Chicago-North Carolina rights as well. The Examiner's decision has not been issued. In the Omaha/ Des Moines Case, the Examiner has recommended grant to Delta of Omaha-Kansas City, Omaha-Twin Cities, and Omaha-St. Louis authority. The case will undoubtedly be reviewed by the Board later this year. In a case yet to be decided by the trial examiner, the Board's Bureau of Operating Rights has recommended the grant to Delta of Columbia/ Augusta- W ashington/ N ew York authority. In the remaining portion of the Southern Route Realignment Case, Delta is seeking various new authorities, including nonstop Memphis-Miami rights; a Nashville-Atlanta segment ( which would integrate with the new Chicago-Nashville authority); and Charlotte-Columbia (S. C.) authority. This proceeding also awaits final CAB decision. In the Kansas City-Atlanta Nonstop Inves- tigation, Delta was the first to utilize a new expedited CAB procedure, seeking authority to operate nonstop in the Kansas City- Atlanta market where Delta now carries the bulk of the traffic ( via Memphis). The other restricted carrier is also seeking nonstop rights, and a hearing will be necessary but the case is expected to move forward rapidly during 1969. Delta's applications in the Transpacific Route Investigation and in the Miami- London Case were denied by the CAB. The CAB also did not grant Delta's appli- cations in the Reopened Pacific Northwest- Southwest, the Twin Cities-California, or the Bermuda Service Investigation cases. In other pending cases, Delta also seeks nonstop St. Louis-Minneapolis/St. Paul authority; a route between Minneapolis/St. Paul and Milwaukee, in the North, and southeastern points; and authority between Seattle/ Portland and California points. The East Coast Points-Europe Case remains in preliminary stages. The CAB has started a number of other route cases in which Delta will be active ( including one to examine the Cleveland- Atlanta, Detroit-Atlanta and Cincinnati- Atlanta markets; an Oklahoma-Southeast Points Case; and an Ohio/Indiana Points Nonstop Investigqtion), but these proceedings are still in preliminary stages. The Company is also a party to a growing number of rate and fare investigations before the CAB. 19 DELTA AIR LIN ES, INC. 20 Balance Sheets June 30, 1969 and 1968 ASSETS 1969 1968 (In Thousands ) CURRENT ASSETS: Cash . . . . . . . . . . . . . . . . . . . . . . . . $ 29,909 $ 17,972 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: Flight Equipment Other Cost- 1969 .. $642,159 $86,542 1968 465,450 61,919 Accumulated depreciation- 1969 195,886 30,398 1968 ... 153,601 24,690 Advance payments for new flight equipment ADVANCE FOR SST DEVELOPMENT, being amortized 14,002 16,019 40,253 36,010 4,553 4,330 1,074 1,214 89,791 75,545 728,701 527,369 226,284 178,291 502,417 349,078 39,879 40,848 542,296 389,926 2,178 $634,265 2,778 $468,249 DELTA AIR LINES, INC. LIABILITIES AND STOCKHOLDER EQUITY CURRENT LIABILITIES: Current maturities of long- 1969 1968 (In Thousands) term debt . $ 7,607 $ 7,794 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 5)- Authorized 25,000,000 shares Outstanding 19,125,000 shares. Capital surplus .. . ... . .. . . . Retained earnings (Note 1) COMMITMENTS (Note 2) 50,945 33,713 8,713 7,352 1,713 1,695 4,855 855 73,833 51,409 214,942 132,436 92,106 26,869 118,975 57,375 22,450 146,690 226,515 70,773 18,657 89,430 57,375 22,450 115,149 194,974 $634,265 $468,249 The accompanying notes are an integral part of these statements. 21 DELTA AIR LINES, INC. 22 Statements of Income for the years ended June 30, 1969 and 1968 1969 1968 OPERATING REVENUES: (In Thousands) Passenger .................... $470,024 $396,793 Cargo . . . . . . . . . . . . . . . . . . . . . . . 42,536 32,141 Other . . . . . . . . . . . . . . . . 3,553 2,628 Total operating revenues .. 516,113 431,562 OPERA TING EXPENSES: Flying operations Maintenance ......... . Aircraft and traffic service 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-Interest capitalized on advances for flight equipment . Interest income, etc. Gain on disposition of aircraft, net .. . .... . . . . . . . . . . . . . . . INCOME BEFORE INCOME TAXES PROVISION FOR INCOME TAXES (Note 3) 112,581 74,531 83,920 52,246 56,876 39,991 13,793 433,938 - - - - 82,175 12,634 (2,742) 9,892 (943) (174) 8,775 73,400 34,209 95,409 64,992 68,719 45,416 40,568 38,940 9,096 363,140 68,422 6,961 (1,763) 5,198 (2,162) (235) 2,801 65,621 29,487 NET INCOME .. ... .. ... $ 39,191 $ 36,134 NET INCOME PER COMMON SHARE $2.05 $1.89 The accompanying notes are an integral part of these statements. Statements of Retained Earnings for the years ended June 30, 1969 and 1968 BALANCE AT BEGINNING OF YEAR .. .... . .... ... . Net income Deduct: Cash dividends-$.40 per share . Transfer to common stock in connection with a 3-for-1 stock split on December 1, 1967 BALANCE AT END OF YEAR (Note 1) DELTA AIR LINES, INC. 1969 1968 (In Thousands) $115,149 $124,915 39,191 36,134 154,340 161,-049 7,650 7,650 38,250 $146,690 $115,149 Statements of Source and Disposition of Funds for the years ended June 30, 1969 and 1968 FUNDS PROVIDED BY: Net income ...... .. . . Add noncash expenses- Depreciation and amortization . Deferred Feder. al income taxes. Investment tax credit, net Other, net 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 1969 1968 (In Thousands) $ 39,191 56,876 21,333 8,212 1,117 126,729 128 90,000 $ 36,134 40,568 17,406 5,753 (5,003) 94,858 6,786 50,000 216,857 151,644 184,340 25,423 209,763 7,622 7,650 114,520 12,358 3,000 129,878 10,646 7,650 225,035 148,174 $ (8,178) $ 3,470 $ 15,958 $ 24,136 The accompanying notes are an integral part of these statements. 23 DELTA AIR LINES, INC. 24 Notes to Financial Statements June 30, 1969 1.LONG-TERM DEBT: At June 30, 1969, the Company's long-term debt of $222.5 million (including current maturities) consisted of the following: (a) $185 million due banks under a credit agreement which provides for borrowings up to $220 million on a revolving basis to December 31, 1970, at which time the out- standing balance will be converted to a 5-year term loan. Loans under the agree- ment are unsecured and carry an interest rate of % above the prime rate, (b) $31.2 million due insurance companies under 6% unsecured notes, repayable in installments to October, 1974 ($5 million payable in fiscal 1970), and (c) $6.3 million due the manufacturer of the Deltamatic Reservation System, repayable in quarterly installments (including 4 % interest) of $710,000. Under terms of the credit agreements, $53.6 million of retained earnings at June 30, 1969, is restricted as to the payment of cash dividends. 2. COMMITMENTS: The Company has outstanding purchase com- mitments for the acquisition of five Douglas DC-8 jet aircraft, ten Douglas DC-9 jet air- craft, five Boeing 747 jet aircraft and twenty- four Lockheed L-1011 aircraft which will re- quire an expenditure of approximately $475 mil- lion during the fiscal years 1970 through 1975. The Company leases certain airport facilities, ticket offices, etc., under long-term agreements. Minimum annual rentals are approximately $5.6 million under such leases expiring after June 30, 1972. 3. PROVISION FOR INCOME TAXES: The provision for income taxes for 1969 and 1968 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 1969 1968 ( In Thousands) $ 4,664 $ 6,328 21,333 17,406 12,798 ~ 38,795 32,616 All available investment tax credits have been utilized to reduce the Company's Federal in- come taxes payable. DELT A AIR LIN ES, IN C. 4. PENSION PLANS: The Company has noncontributory pension plans covering substantially all of its employees. The total pension expense amounted to $10.9 mil- lion in 1969. 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. STOCK OPTIONS: Under the Company's qualified stock option plan for 100,000 shares of common stock, options for 79,000 shares have been granted and were outstanding at June 30, 1969 (50,000 shares at $31.125 per share and 29,000 shares at $34.75 per share). Options for 12,500 shares are cur- rently exercisable. AUDITORS' REPORT ARTHUR ANDERSEN & Co. ATLANTA, GEORGIA To the Stockholders and Board of Directors of Delta Air Lines, Inc.: We have examined the balance sheet of Delta Air Lines, Inc. (a Delaware corporation) as of June 30, 1969, and the related statements of income, retained earnings and source and disposition of funds for the year then ended. Our examination 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, 1969, and the results of its operations and the source and disposi- tion of funds for the year then ended, in conformity with generally accepted accounting principles ap- plied on a basis consistent with that of the preced- ing year. Atlanta, Georgia, August 15, 1969. 25 DELTA AIR LINES, IN C. 26 Five Years of Delta Air Lines Growth Years Ended June 30 (Dollars expressed in thousands except per share figures) 1969 Operating revenues Passenger . .. . . .... $470,024 Cargo . ... 42,536 All other .. . ... . . 3,553 Total operating revenues $516,113 Operating expenses 433,938 Operating income . . . . . . . . . . . . $ 82,175 Interest expense, etc.-net 8,949 Gain on disposition of aircraft-net 174 Income before income taxes . $ 73,400 Income taxes . ... . .. .. . . . 34,209 Net income . . . . . . . . $ 39,191 Net income per share* $2.05 Dividends paid . . . . . . . . . $7,650 Dividends paid per share* $0.40 Total assets $634,265 Stockholder equity $226,515 Stockholder equity per share* $11.84 Shares of common stock outstanding* 19,125,000 Revenue passengers carried 12,107,061 Available seat miles (000) . 14,768,892 Revenue passenger miles (000) 8,249,085 Passenger load factor 55.85% Available ton miles (000) .... . ..... . . . . . 1,994,826 Revenue ton miles (000) . . . . . . . . . . . . . . 965,795 Passenger revenue per passenger mile 5.70 Operating expenses per available seat mile 2.94 Operating expenses per available ton mile 21.75 * Adjusted to reflect all stock splits 1968 $396,793 32,141 2,628 $431,562 363,140 $ 68,422 3,036 235 $ 65,621 29,487 $ 36,134 $1.89 $7,650 $0.40 $468,249 $194,974 $10.19 19,125,000 10,368,831 11,972,737 7,116,095 59.44% 1,609,704 814,782 5.58 3.03 22.56 DELTA AIR LINES, INC. 1967 1966 1965 $362,368 $291,350 $234,036 31,638 24,039 19,620 3,830 3,541 3,804 $397,~36 $318,930 $257,460 308,737 253,092 213,131 $ 89,099 $ 65,838 $ 44,329 641 1,676 1,875 2,402 562 602 $ 90,860 $ 64,724 $ 43,056 41,670 30,170 20,051 $ 49,190 $ 34,554 $ 23,005 $2.57 $1.81 $1.20 $6,375 $6,056 $4,845 $0.33 $0.32 $0.25 $369,422 $314,350 $231,274 $166,490 $123,675 $ 95,177 $8.71 $6.47 $4.98 19,125,000 19,125,000 19,125,000 9,422,422 7,556,422 5,964,269 9,687,337 8,196,349 6,793,654 6,415,467 4,997,958 3,855,012 66.23% 60.98% 56.74% 1,304,889 1,090,282 907,014 735,898 569,625 442,239 5.65 5.83 6.07 3.16 3.06 3.12 23.66 23.21 23.50 27 28 Board of Directors R. W. FREEMAN W. T. BEEBE B. W. BIEDENHARN R. W. COURTS C.H. DOLSON EMERY FLINN DAVID C. GARRETT, JR. EDWARD H. GERRY CHARLES H. KELLSTADT JOHN R. LONGMIRE R. S. MAURER T. M. MILLER WINSHIP NUNNALLY ROBERT OPPENLANDER CARLETON PUTNAM Chairman of the Finance Committee New Orleans, Louisiana Atlanta, Georgia Monroe, Louisiana Atlanta, Georgia Atlanta, Georgia Miami, Florida Atlanta, Georgia New York, New York Miami, Florida St. Louis, Missouri Atlanta, Georgia Atlanta, Georgia Atlanta, Georgia Atlanta, Georgia Washington, D. C. GEORGE M. SNELLINGS, JR. Monroe, Louisiana TRANSFER AGENTS: The Citizens and 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 23, 1969, Monroe, Louisiana Delta Air Lines, Inc., General Offices, Atlanta Airport, Atlanta, Ga. 30320 Officers C.H.DOLSON ADMINISTRATION W.T.BEEBE R. W.ALLEN R. H. WHARTON J.A. YORK FINANCE President Senior Vice President-Administration Asst. Vice President-Administration Asst. Vice President-Personnel Asst. Vice President-Employee Services ROBERT OPPENLANDER Senior Vice President-Finance & Treasurer PAUL W. PATE Vice President-Properties W. A. ATCHISON Asst. Vice President-Computer Services J. D. DUNN Asst. Vice President-Purchasing M. O. GALLOWAY Asst. Vice President-Comptroller J. R. HOWELL Asst. Treasurer HUGH H. SAXON LEGAL R. S. MAURER ROBERT L. GRIFFITH MORRIS SHIPLEY J. W. CALLISON J.A. COOPER FRANKF.Rox MARKETING T.M.MILLER SHELBY D. DEMENT CHARLES P. KNECHT J. W.MEYER HENRY Ross OPERATIONS Asst. Treasurer Senior Vice President- General Counsel & Secretary Vice President-Federal Affairs* Vice President-Government Affairs Asst. Vice President-Law Asst. Vice President-Economic Research Asst. Vice President-Law Senior Vice President-Marketing Asst. Vice President-Traffic & Sales Asst. Vice President-Sales Asst. Vice President-Customer Relations Asst. Vice President- Advertising & Sales Promotion DAVID C. GARRETT, JR. Senior Vice President-Operations T. P. BALL Asst. Vice President-Flight Operations J. K. BURNETTE Asst. Vice President-Quality Control A. C. FORD Asst. Vice President-Long Range Planning E. L. HAMNER Asst. Vice President-Stations D. P. HETTERMANN JACKS. KING W. L. MILLER J.F. NYCUM L. G. RoDEFELD J. H. TURNER C. B. WILDER *Retired July 1, 1969 Asst. Vice President-Engineering Asst. Vice President-Flight Control Asst. Vice President-Materiel Services Asst. Vice President-Flt. Eqpt. Development Asst. Vice President-Communications Asst. Vice President-Maintenance Asst. Vice President-Technical Operations