DELTA AIR LINES, INC. 
ANNUAL REPORT 1973 
 The Cover 
Representatives of Delta's All-Pro Team- now 
27,500 strong and always "Ready When You Are'.' 
Contents 
Merger with Northeast .. . ..... .... .. . .. . . 
Highlights of the Year. . . . . . . . . . . . . . . . . . . 2 
Report to the Stockholders. . . . . . . . . . . . . . . . 3 
Revenues and Expenses. . . . . . . . . . . . . . . . . . 6 
Earnings and Dividends. . . . . . . . . . . . . . . . . 7 
Capitalization and Financing. . . . . . . . . . . . . 7 
Flight Equipment and Purchase 
Commitments...... . . . . . . . . . . . . . . . . 8 
Facilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 
Environmental Matters ........ . ......... 11 
Security Programs. . . . . . . . . . . . . . . . . . . . . . 12 
Personnel. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 
Regulatory Matters. . . . . . . . . . . . . . . . . . . . . . 14 
Route Map . . ................ . ... .. . 20, 21 
Financial Statements- 
Balance Sheets. . . . . . . . . . . . . . . . . . . 22, 23 
Statements of Income . .. . ......... 24, 25 
Statements of Retained Earnings ....... 26 
Statements of Additional Paid-in 
Capital. ....................... 27 
Auditors' Report. .......... .. .... . .. 26 
Statements of Changes in Financial 
Position . . . ... . .. . ..... . ....... 28 
Notes to Financial Statements .. ........ 29 
Five-Year Summary .................. 36, 37 
Board of Directors. . . . . . . . . . . . . . . . . . . . . . 38 
Officers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 
 Delta Air Lines Annual Report 1973 
Merger with Northeast 
The merger with Northeast Airlines, Inc. 
was consummated on August l, 1972. In 
exchange for all outstanding common stock 
of Northeast, Delta issued 668,515 shares of 
its common stock. Delta also issued to Storer 
Broadcasting Company (majority stockholder 
of Northeast) warrants to purchase 500,000 
shares of Delta stock at $48.00 per share on 
or prior to May 1, 1978, in exchange for the 
transfer to Delta of the approximately $40 
million owed by Northeast to Storer at merger 
date. Delta assumed the other long-term 
debt of Northeast totaling $38 million, 
including $22 million in subordinated 
convertible debentures maturing in 1986 
and convertible into Delta stock at $250 per 
share. Immediately after the merger, Delta 
prepaid $3.5 million of the remaining debt 
and renegotiated the $12.5 million insurance 
company and bank loans from secured to 
unsecured debt on essentially the same terms 
as Delta1s existing bank credit agreements. 
The merger was accounted for as a 
pooling of interests and all prior financial 
statements of Delta have been restated to 
include Northeast's results of operations. 
(See Note 2 on page 30 and Note 1 on page 36.) 
Unless otherwise indicated, 1972 results of 
operations used for comparison purposes on 
pages 2 through 19 of this report are based 
on a combining of Delta-only results and 
unaudited Northeast results for the twelve 
months ended June 30, 1972. An unaudited 
statement of income for this period is pre- 
sented on pages 24 and 25. 
 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. 
Per Cent 
1973 1972 Change 
Operating 
Revenues. ..... $1,049,699 $895,629 +17% 
Operating 
Expenses ... $928,940 $823,565 +13% 
Net Income. $65,995 $33,227 +99% 
Earnings Per 
Share. $3.32 $1 .68 +98% 
Revenue Passengers 
Enplaned. . . 23,702,870 20,820,918 +14% 
Available Seat 
Miles (000). .. 27,958,095 26,023,066 + 7% 
Revenue Passenger 
Miles (000). . .. . ... . . 14,449,748 12,595,325 +15% 
Passenger Load 
Factor .. 
' ' 
. . . ' 
. . . 
. . ' 
51.68% 48.40% + 7% 
2 
 Report to the Stockholders 
The major highlight of the past year was 
the successful merger with Northeast 
Air lines. The merger was consummated on 
August 1, 1972, adding to Delta's route 
system major new opportunities in the highly 
competitive Northeast to Florida, Bermuda 
and the Bahamas markets as well as the less 
competitive interior New England markets. 
Beginning in December, 1972, Delta 
brought to these markets substantially 
improved schedules including significant 
new connecting flight patterns between New 
England points and Delta's traditionally 
strong markets in the Southeast and South- 
west. The response of the traveling and ship- 
ping public to these improvements has been 
extremely gratifying. Even more gratifying, 
however, has been the full cooperation and 
extraordinary efforts displayed by the original 
Delta and former Northeast employees as they 
faced and overcame the tremendous chal- 
lenges of smoothly combining the two com- 
panies without permitting any deterioration 
in our traditional personalized service. 
Perhaps the best indicator of the merger's 
success is in the financial results achieved. 
For fiscal 1973, net earnings were at an all- 
time high of $66 million or 99% above the 
combined earnings of Delta and Northeast 
last year. Operating revenues passed the 
billion dollar mark for the first time at$ 1.05 
billion as passenger traffic increased 15% 
and yield improved by 2%. Cargo revenues 
3 
 were up 17% to $76.3 million despite a 
continued slowdown in mail volumes. 
Total operating capacity was held to 
only a 7% growth resulting in load factors 
improving from 48.4% to 51.7%. Most of this 
growth was a result of the substantial 
improvements in schedules on the former 
Northeast system. Unit operating costs 
increased 5% to 3.32<!: per available seat mile 
partially due to the expensing of all known 
one-time costs related to the merger. 
Immediately after the merger, Delta 
implemented a three-year program to mod- 
ernize and standardize its aircraft fleet for 
purposes of improving operating efficiency 
and unit operating costs. The previously 
announced order for Boeing 727 -200 aircraft 
was expanded to a total of 36. These aircraft 
( 10 of which had been delivered at year-end) 
will replace the fleets of 13 DC-9-14, 15 CV- 
880, and 7 DC-8-33 aircraft. The DC-9's have 
been sold to Southern Airways with final 
delivery scheduled no later than October, 
1973. The CV-880 and DC-8-33 aircraft were 
sold to The Boeing Company with delivery 
scheduled over a ten to twelve month period 
beginning in October, 1973. In addition to 
these major sales, two Boeing 727-100 air- 
craft were sold in May, 1973, and negotiations 
are underway for the sale of four DC-9-31 
aircraft for delivery late in fiscal 197 4. 
The leased DC-10 aircraft will be 
returned to United Air Lines in May, 1975. 
To replace these aircraft, the original delivery 
schedule for the first 24 Lockheed L-1011 
aircraft was revised during the year and an 
additional 6 aircraft were ordered for delivery 
in 1976. Financing for all outstanding pur- 
chase commitments will be provided from 
internally generated funds, the $85 million 
loan agreement with Lazard Brothers&. Co., 
Limited, and from a new bank credit agree- 
ment now being finalized. 
The new Chairman of the Civil Aero- 
nautics Board, the Honorable Robert D. Timm, 
has expressed his intention to institute 
affirmative programs designed to improve 
the financial stability of the entire airline 
4 
 industry. These programs include the mini- 
mizing of regulatory lag in fare decisions, 
the exercise of caution in awarding new 
competition, and the phased elimination of 
discriminatory and uneconomic discount 
fares. Consistent application of such positive 
programs is most important to the creation 
of a financially stable industry with an 
adequate opportunity to earn a fair and 
reasonable return on the investor's dollar. 
Fiscal 197 4 will be a year of completely 
different challenges from those faced in the 
past year, principally due to the present 
uncertain outlook for the general economy. 
Because of these uncertainties, Delta's operat- 
ing plans for the last half of the year have 
been designed to permit rapid response to 
either higher or lower traffic growth. Pas- 
senger mile yields should continue to improve 
as the family and youth discount fares are 
phased out. In addition, a moderate fare 
increase will probably be approved by the 
CAB before the end of 1973 to help offset the 
impact of inflation on operating costs. 
Growth in unit operating costs should 
moderate noticeably from the 1973 levels as 
the benefits of the merger and the more 
efficient new aircraft are partially realized. 
Even with the uncertainties-and uncertainty 
is always present in a dynamic economy and 
a dynamic industry-we are confident that 
197 4 and the years beyond will be successful 
for Delta. 
~ ~(h'4 
W. T. BEEBE DAVID C. GARRETT, JR. 
Chairman of the Board & President 
Chief Executive Officer 
September 7, 1973 
5 
 Revenues and Expenses 
Operating revenues passed the billion dollar 
mark for the first time in the history of our 
company, reaching$ 1.05 billion, a 17% 
increase over the combined total for Del ta 
and Northeast last year. Both passenger 
revenues and cargo revenues increased 17% 
to a total of $960.2 million and $76.3 million, 
respectively. 
Passenger traffic continued to reflect 
the generally strong economy as revenue 
passenger miles increased 15% to a total of 
14.4 billion. Freight traffic also showed a 
healthy increase of 24%, but mail volume 
was down 6%. 
The passenger mile yield increased 2% 
to 6.65<!: from 6.49<!: in 1972. This increase 
resulted primarily from a 2. 7% fare increase 
on September 5, 1972. Effective June 1, 1973, 
the Civil Aeronautics Board ordered Family 
and Youth discount fares phased out over a 
twelve-month period. Because this change 
was in effect for only one month in fiscal 
1973, revenues were affected only nominally. 
Cargo yield was up 3% over the previous year. 
Operating expenses were $929 million, 
an increase of 13% over last year. Operating 
capacity was up 7%, due primarily to the 
introduction of five Douglas DC-lO's in the 
Winter season and increased utilization on 
the former Northeast aircraft. Responding 
to continued high levels of inflation and 
6 
 the added cost of combining the Delta and 
Northeast operations, unit costs per seat mile 
and ton mile rose 5% and 7%, respectively. 
Earnings and Dividends 
Reflecting continued good traffic growth, 
higher yields, and the effectiveness of the 
Delta-Northeast merger, net earnings were 
$66.0 million, or $3.32 per share, a 99% 
increase over the combined Delta and North- 
east results last year. The earnings for Delta 
alone last year were $42.2 million, or 
$2.20 per share. 
The current year's results include a non- 
recurring charge of $4.0 million ( 11 <i: per 
share after taxes) for such merger related 
expenses as personnel relocation and 
training, aircraft and facilities alterations, 
and initial advertising and sales promotion. 
Also included is a gain of $4.7 million (12<!: 
per share after taxes) from the sale of DC-9-14 
and B-727 -100 aircraft. The 1972 results 
included a SQ: per share after tax reduction 
in amortization expense resulting from the 
refund of advances made for SST develop- 
ment and a SQ: per share after tax gain from 
insurance proceeds on a DC-9 aircraft 
destroyed in a training accident. 
Dividend payments for the year totaled 
$9,925,000, or 50<!: per share. Fiscal 1973 
marked the 24th consecutive year of cash 
dividend payments. At its July, 1973 meeting, 
the Board of Directors increased the dividend 
by 20% to an annual rate of 60<!: per share. 
Capitalization and Financing 
During fiscal 197 3~ Delta borrowed the $20 
million available under the 1971 Bank Credit 
Agreement. This amount had been pre- 
viously advanced to Lockheed and Lockheed 
is reimbursing Delta for the cost of the 
borrowings. The principal will be repaid to 
Delta and Delta will repay the banks in 
equal installments concurrently with the 
delivery of the first twelve L-1011 aircraft. 
7 
 The renegotiated loan agreement with 
Lazard Brothers & Co., Limited, was finalized 
during the year and provides approximately 
$85 million to finance the Rolls-Royce 
engines on the first 24 Lockheed L-1011 air- 
craft. Repayments will be in semi-annual 
installments over a period of ten years, 
starting six months after the first borrowings 
which were made in July, 1973. 
Delta is negotiating a new bank credit 
agreement which will provide for borrowings 
up to $300 million on a revolving basis 
through September 30, 1975, at which time 
the balance outstanding will be converted 
to a term loan, repayable quarterly over five 
years. Initial proceeds of the new agreement 
will be used to repay the $156 million prin- 
cipal now outstanding under the 1967 Bank 
Credit Agreement. 
At June 30, 1973, outstanding commit- 
ments for aircraft and related spares will 
require the future expenditure of approx- 
imately $680 million during fiscal years 197 4 
through 1977. It is estimated that funds pro- 
vided by the new bank credit agreement and 
the Lazard agreement, together with funds 
generated internally from earnings, depre- 
ciation, and deferred taxes, will adequately 
cover these purchase commitments and the 
payment of normal debt maturities. 
Stockholder equity at June 30, 1973 was 
$364,553,000 or $18.35 per share on the 
19,866,524 shares outstanding, including 
the 668,515 shares issued to Northeast stock- 
holders at merger date. 
Flight Equipment and Purchase 
Commitments 
During fiscal 1973, Delta accepted delivery 
of 5 leased wide-bodied DC-10 aircraft and 
10 B-727-200 aircraft, in addition to the fleet 
of 21 B-727's, 14 DC-9's, and 6 FH-227's 
acquired in the merger with Northeast. 
During the year, 7 DC-9-14's and 2 B-727- 
lO0's were sold, and a Convair 880 was 
retired after being damaged in an accident. 
8 
 As of June 30, 1973, Delta operated the 
following passenger fleet: 
Type of Fleet 
Aircraft Seats Owned Leased Total 
B-747 ........ 370 5 5 
DC-10 .. . .... 250 5 5 
DC-8-61 ...... 195 13 13 
DC-8-51 .. . . .. 135 21 21 
DC-8-33 ...... 135 7 7 
B-727-200 ..... 131 10 13 23 
B-727-100 . .... 96 6 6 
CV-880 . ... .. 96 15 15 
DC-9-31/32 ... 90 67 10 77 
DC-9-14 .. .. .. 68 6 6 
FH-227 . ...... 43 6 6 
Totals .. .. . . 150 34 184 
The five leased DC-10 aircraft will be re- 
turned to United Air Lines in May, 1975. The 
remaining 29 leased aircraft were acquired in 
the Northeast merger under very favorable 
payment terms. 
On July 31, 1973, a leased DC-9-31 air- 
craft was destroyed in a landing accident at 
Boston. Since the last accident involving pas- 
senger fatalities in May, 1953, Delta's safety 
record had extended for more than twenty 
years during which time Delta flew some 
146,000,000 passengers more than 
95,000,000,000 revenue passenger miles. 
At June 30, 1973, Delta had purchase 
commitments for 26 additional Boeing 727- 
200 aircraft to be delivered during fiscal 197 4 
and 1975 and 30 Lockheed L-1011 aircraft for 
deli very during fiscal years 197 4 through 
1977. Options are outstanding on six 727-200 
aircraft for deli very in fiscal 197 5. All of the 
new 727-200 aircraft are equipped with wide- 
bodied interiors and the 727-100 and 727-200 
aircraft acquired in the merger are being 
modified to wide-bodied interiors. 
Concurrently with the receipt of the 
new Boeing 727-200 aircraft, Delta is selling 
its DC-9-14 fleet to Southern Airways. Seven 
of these aircraft had been delivered at year- 
end and the remaining six are being delivered 
9 
 at a rate of two per month in the September, 
1973 quarter. Delta has also entered into 
agreements with the Boeing Company to sell 
its fleet of 15 CV-880 aircraft and 7 DC-8-33 
aircraft and associated spare parts and 
engines. Delivery of these aircraft to Boeing 
will be made over a ten to twelve-month 
period beginning in October, 1973. Delta 
recently signed a Letter of Intent to sell 4 
DC-9-31 aircraft to Ozark Air Lines with 
delivery to be made late in fiscal 197 4. Be- 
cause of the rapidly increasing cargo lift ca- 
pacity made available by the introduction of 
of the new wide-bodied aircraft, Delta is 
phasing out its all-cargo services and the 
three all-cargo L-100-20 aircraft will be sold 
in fiscal 197 4. 
Facilities 
During the past year Delta moved into new 
or expanded airport facilities at Atlanta, 
Houston, Ft.Lauderdale, Kansas City, Las 
Vegas, Orlando, and Philadelphia. Expanded 
terminal facilities were acquired in the mer- 
ger at the critical Kennedy and LaGuardia 
airports in New York and at the Washington 
National Airport. New terminal construction 
is underway at Birmingham, Cincinnati, 
Newark, Memphis, and Knoxville. The new 
Dallas/Ft.Worth Regional Airport, which 
covers more land area than Manhattan, will 
be opened later in 1973. Systemwide facilities 
for the new L-1011 airer aft are nearing com - 
pletion. The major addition to the Atlanta 
Maintenance and Overhaul Base, designed to 
accommodate the expanding wide-body air- 
craft fleet, was occupied during the year. 
Fuel storage facilities are being 
expanded in Atlanta, Boston, and several 
other cities to support expanded schedules 
and to provide additional fuel reserve 
capacity. 
A 50% expansion of the Greenbriar 
Finance Center will be complete in September, 
1973. This addition will house the new IBM 
360-195 computer system designed to meet 
passenger reservation needs throughout this 
decade. The leased 360-65 computer system 
10 
 acquired in the merger has now been con- 
solidated with other fully compatible systems 
at the Greenbriar facility. 
New City Ticket offices were opened 
in Boston and Worcester and are planned 
for Manchester, Hartford, Bangor, and 
Bermuda. Facilities at all former Northeast 
cities are being reviewed with modifications 
made as required. 
New Reservations offices in Los Angeles 
and Dallas were completed and other Sales, 
Reservations, and Ticket office improvement 
and expansion programs are presently 
in progress. 
Environmental Matters 
Delta's three-year program for modernizing 
and standardizing its aircraft includes full 
consideration of the need to minimize or 
eliminate noise and air pollution. All new 
aircraft received during the past year and all 
aircraft on order meet current Federal Air 
Regulations for noise levels and are equipped 
with smokeless engines. As these aircraft 
are received and the first generation CV-880 
and DC-8-33 aircraft are retired, the noise 
and visible smoke levels at major airports 
served by Delta will be noticeably improved. 
The existing DC-9 and B-727 engines have 
been fully modified to eliminate visible 
smoke emissions. Airport landing and take- 
off procedures are constantly monitored and 
revised to achieve minim um noise levels 
in the airport area so long as such revisions 
do not in any way compromise safety. 
Delta is also concerned about the 
potential water pollution created by its 
ground operations. The Atlanta Maintenance 
and Overhaul Base includes an industrial 
waste treatment plant which utilizes the 
latest available technology. At most major 
airports, facilities are installed or under 
construction to filter the drainage from 
airport buildings and ramps in order to 
eliminate contaminants before the water 
is released into adjacent rivers and streams. 
11 
 Security Programs 
Since December, 1972, all domestic airlines 
have been conducting 100% passenger 
screening in accordance with Federal Avia- 
tion Regulations. Prior to boarding flights, 
all passengers are screened for weapons and 
all carry-on luggage is searched. Delta is 
presently evaluating the use of x-ray devices 
to speed up the search of carry-on baggage 
and reduce passenger inconvenience. 
Wherever practical Delta is utilizing the 
''secure concourse'' approach to screening. 
This procedure provides maximum security 
at minimum costs and minimum congestion 
at individual boarding gates. Since these 
programs were begun, no attempt to hijack 
an airliner in the United States has 
been successful. 
Effective April, 1973, the Civil Aero- 
nautics Board approved a security charge of 
34q: per flight coupon to cover the cost of the 
passenger screening operation. On May 12, 
1973, the Board approved an additional 25<i'. 
charge per flight coupon to offset the cost 
of the federally required airport armed guard 
program. These charges are subject to further 
review by the Civil Aeronautics Board after 
the actual cost to the airline industry of 
conducting these programs is fully known. 
Personnel 
Excluding temporary disadvantaged youth 
and vacation relief employees, the team of 
Delta Professionals numbered 27,500 at year- 
end, up 11.5% over the combined total at 
June 30, 1972. Total salaries and related 
fringe benefits increased 16% to $450.4 
million, equal to 43<i: of each revenue dollar. 
The merger approval by the Civil Aero- 
nautics Board was subject to certain Labor 
Protective Provisions such as salary levels 
and the costs of transfers. In those relatively 
few cases in which an employee's total pay 
was adversely affected by the merger, Delta is 
paying displacement allowances for a period 
of four years or until the employee's normal 
12 
 pay exceeds the minimum established under 
the merger agreement. A total of 825 em- 
ployees were transferred as a direct result of 
the merger, primarily from Boston and Miami 
to Atlanta, at a cost to Delta, including pay- 
ments for losses on home sales, of $2.3 
million. An estimated additional 125 trans- 
fers are planned for the next several months 
to complete the centralization of certain 
functions. 
On April 16, 1973, Delta concluded an 
agreement with the U.S. Departments of Labor 
and Justice to assure transfer and promotional 
opportunities for certain qualified minority 
and female employees who, the government 
alleged, may have been denied such oppor- 
tunities because of their race or sex. Approx- 
imately 1,900 employees are directly affected 
by this five-year agreement. The agreement 
provides for back pay awards under certain 
conditions, for which the Company's maxi- 
mum liability is estimated not to exceed 
$800,000. 
In 1972, Delta's flight personnel and the 
Atlanta Maintenance Base personnel both 
received Awards of Merit from the National 
Safety Council for outstanding accomplish- 
ment in the field of personnel safety in 1971. 
These awards are typical of Delta's historical 
emphasis on safety first-for its employees 
and its customers. Even so, the Occupational 
Safety and Health Act of 1970 imposes on 
Delta and all employers extensive new 
responsibilities for safe working environ- 
ments and safe work practices. These respon- 
sibilities and the appropriate authority have 
been assigned to a Management Safety 
Committee composed of representatives 
from each of the Company's major 
departments. 
Officers retiring during the past year 
were Mr. P.W. Pate as Vice President- 
Properties, Mr. R.H. Wharton as Assistant 
Vice-President-Employee Relations, and 
Mr. C.B. Wilder as Assistant Vice President- 
Operations Administration. The combined 
13 
 careers of these gentlemen totaled almost a 
century of excellent service to Delta and the 
industry. 
Mr. George B. Storer, Sr. retired on 
October 27, 1972 as a Director and was elected 
Director Emeritus. Mr. Stuart W. Patton, a 
Director of Storer Broadcasting Co., was 
elected to succeed Mr. Storer. 
Regulatory Matters 
As has been true during the past several 
years, regulatory activities continue to be 
concentrated in areas other than new route 
proceedings, and in particular in the field 
of rates and fares. 
Regulatory Climate. 
Under the guidance of its new Chairman, 
the Honorable Robert D. Timm, during 
recent months the Civil Aeronautics Board 
has increased its efforts to improve the profit- 
ability of the entire airline industry. These 
activities have included continuing caution 
in the institution of new route cases which 
could result in uneconomic levels of com- 
petition; programmed elimination of dis- 
criminatory and uneconomic discount fares 
such as the "youth" and "family fare" plans; 
advance planning to meet possible fuel 
shortages; and other affirmative programs. 
It would appear that the CAB will retain 
this same approach during ensuing months. 
Route Cases. 
A number of route cases, mostly started 
some years ago, remained active during the 
fiscal year. On the domestic system the CAB 
granted Delta nonstop authority between 
Memphis and Miami. This service was 
inaugurated on July 1, 1973. The award came 
in a proceeding ordered by a federal appeals 
court to review an ear lier denial of the same 
Delta application. Although the current 
decision also grants Southern permissive 
nonstop Memphis-Miami authority, Southern 
has nevertheless appealed the Delta award 
14 
 to the same federal court which reviewed 
the earlier case. Final court decision is not 
expected before the end of 1973 and in the 
meantime Delta will continue to operate 
its new nonstop services. 
In the same proceeding the CAB denied 
a Delta application for nonstop Atlanta- 
Nashville authority, while granting such 
authority to Southern Airways. This portion 
of the CAB proceeding is not involved in 
the court appeal. 
In another proceeding remanded by a 
federal court, the Board has granted Miami- 
Houston authority to Continental Air Lines. 
Implementation of this decision would 
necessitate termination of Delta's four year 
old Miami-Houston nonstop operations. 
Delta has appealed the decision to a federal 
court of appeals, however, and at Delta's 
request the court has stayed the award to 
Continental. Pending court review on the 
merits, therefore, Delta will continue to 
operate in this market and Continental will 
be unable to institute this service. Final 
decision in this court case is not expected 
before the end of 1973. 
In 1970 a CAB Administrative Law 
Judge recommended that Delta be granted 
nonstop Atlanta-Cleveland authority (in 
competition with United) and that Eastern 
be authorized to compete with Delta in the 
Atlanta-Detroit and Atlanta-Cincinnati 
markets. This case was subsequently 
remanded by the CAB to the Judge for a new 
hearing to update the record. The new 
hearing was concluded during the last fiscal 
year, following which (on July 12, 1973) a 
new initial decision reached the same con- 
clusions concerning all three markets that 
were reached in 1970. This latest decision 
will be reviewed by the CAB and its decision 
is not expected before late 1973. 
During the fiscal year Del ta asked the 
CAB to dismiss its application for nonstop 
Nashville-Detroit authority. This action was 
taken in light of the Board's denial of Delta's 
Atlanta-Nashville application. The CAB 
15 
 has not yet ruled on the dismissal motion, 
and probably will not do so until it decides 
the Detroit-Nashville Nonstop Service Inves- 
tigation in which the Board's Administrative 
Law Judge recommended denial of Delta's 
Nashville-Detroit application. The CAB 
decision is expected sometime in the fall 
of 1973. 
During the fiscal year the CAB insti- 
tuted the Miami-Los Angeles Competitive 
Nonstop Service Case, to consider whether 
to lift the stay on Delta's authority in this 
market which was imposed at the time of 
the Delta-Northeast merger, or to grant 
competitive Miami-Los Angeles authority 
to some other carrier (or to leave the market 
a National Airlines monopoly). The Admin- 
istrative Law Judge has recommended Pan 
American Airways' selection for this market 
and the termination of Delta's stayed 
authority. The matter is being reviewed by 
the full CAB, however, and Del ta is vigorous! y 
seeking the right to re-institute service in 
this market. 
On July 9, 1973, an Administrative 
Law Judge issued his initial decision in the 
New England Service Investigation. In this 
case the former Northeast Airlines routes in 
northern New England are being investigated 
to determine what adjustments, if any, 
should be made in them and in the related 
route systems of other carriers in order to 
serve the future needs of this section of the 
country. The Administrative Law Judge 
recommended retention of most of Delta's 
certificate authority in the area, but would 
not require the Company to resume service 
at this time at those New England points at 
which it is now suspended while other 
carriers (generally commuter carriers) con- 
tinue to provide replacement service. This 
decision will be reviewed by the CAB and 
Delta will argue for a number of revisions 
in the Judge's initial decision. 
On the international system, Delta has 
filed applications for nonstop authority 
between Atlanta and the Bahama Islands, 
and between Miami and Jamaica. Neither 
16 
 of these applications, nor the Company's 
pending Atlanta-London/Frankfurt applica- 
tion, has yet been set for hearing. 
Various applications have been filed 
by other carriers for new route authority, 
for realignment of their existing authority, 
or for route exchanges with other carriers, 
which would create new or different com- 
petition for Delta, but all of these proceedings 
are in preliminary stages.  
Merger Cases. 
During the year all major, pending merger 
proceedings before the CAB were terminated. 
The merger between Eastern Air Lines and 
Caribbean Atlantic Airlines was approved, 
subject to a number of restrictions which 
will mitigate the effect of the merger on 
Delta's Caribbean operations. A proposed 
merger between American Air lines and 
Western Air Lines was disapproved by the 
CAB and a proposed National Air lines- 
North west Airlines merger was voluntarily 
terminated by those two carriers. 
Rate and Fare Cases. 
The CAB's investigation into the structure 
and level of U.S. airline passenger fares has 
been in continual process for nearly three and 
one-half years. Seven of the Investigation's 
ten phases have now fully been decided, and 
two others await only a response to requests 
for reconsideration of the Board's basic 
decisions. During the fiscal year the CAB 
decided the "Discount Fare" phase of the 
Investigation, in which it ordered the youth 
standby, youth reservation and family fares 
terminated on a progressive basis over a one- 
year period ending on June 1, 197 4; ruled 
that Discover America excursion fares would 
no longer be considered lawful after mid- 
197 4; and established new policy guidelines 
to contain the practice of publishing exces- 
sive numbers of discounted fares which often 
dilute revenue far more than they generate 
new traffic. 
17 
 During the fiscal year the CAB also 
rendered its final decision in the "Seating 
Configuration11 phase of the Investigation. 
In this decision the CAB provided strong 
incentives for all carriers to eliminate such 
space wasting and expensive features as 
coach lounges and, thereby, improve the 
overall productivity of their aircraft. 
Continental has sought court review of 
this action. 
In August of 1972, the CAB permitted 
the final portion of its fare level decision to 
become effective, resulting in a 2. 7% increase 
over then-existing fares. This increase 
became effective on September 5, 1972. Also 
during the fiscal year the CAB approved the 
addition of surcharges on existing fares in 
order to cover the costs of the new anti- 
hijacking program. 
The major remaining portion of the 
Investigation concerns the overall fare 
structure-the relationship between differ- 
ent basic types of fares and between fares 
for differing lengths of travel; and such 
features as reduced "off-peak11 fares used by 
Delta in its famous "Early Bird11 and "Owly 
Bird11 services-in which decision is expected 
later in 1973. 
Since the close of the fiscal year the 
CAB found that the passenger fare levels 
actually charged from October 1969 to mid- 
October 1970 were fully lawful. Certain non- 
airline parties have sought judicial review, 
although the decision was a unanimous one 
by the present four members of the Board. 
Other court cases which seek reparations for 
passengers on the theory that the October 
1969-October 1970 fares were improper 
remain in abeyance pending final conclusion 
of this proceeding. 
The CAB and the carriers are also 
actively engaged in comprehensive investi- 
gations of the reasonableness and the struc- 
ture of domestic airline air frieght rates; and 
of the proper level of the rates paid to the 
carriers for the carriage of mail. The mail 
case has been pending since the latter part 
18 
 of 1970, and only recently has been split into 
two phases so that mail rates for the past 
period of December, 1970-March 27, 1973 can 
be set expeditiously and any additional 
compensation due the carriers for that 
period of time can be paid in the reasonably 
near future. The remainder of the proceed- 
ing, dealing with rates for the future carriage 
of air mail, first-class-mail-by-air, and newly- 
instituted containerized mail programs, will 
be processed during the latter part of 1973 
and in 197 4. Miscellaneous other rate and 
fare proceedings remain in preliminary 
stages before the CAB. 
19 
 20 
Delta Air Lines System Route Map 
Border to border, coast to coast, thru 
the Caribbean and on to South 
America, Delta's fleet of 184 jets 
connects 99 key destinations in five 
countries, bringing that distinctive 
Delta brand of personal service to over 
23 million passengers yearly. 
MA 
( 
NNIS 
NTUCKET 
HA'S 
EYARD 
BERMUDA 
DELTA/ 
PAN AM 
TH RU -JETS 
TO AND 
tFROM 
EUROPE 
21 
 DELTA AIR LIN ES, INC. 
Balance Sheets 
June 30, 1973 and 197 2 (Note 2) 
ASSETS 
CURRENT ASSETS 
Cash. 
Short-term cash investments, 
at cost. 
Accounts receivable, net. 
Maintenance and operating 
supplies, at average cost . 
Prepaid expenses, etc 
Total current assets. 
PROPERTY AND EQUI PMENT 
(Note4): 
Flight 
Equipment Other 
Cost - 
1973 $978,428 
1972 906,067 
$152,464 
135,690 
Accumulated depreciation - 
1973 439,635 75,841 
1972 388,447 64,471 
Advance payments for new 
equipment (Note 4). 
OTHER ASSETS, being 
amortized: 
Nonoperating property and 
equipment, etc .. 
Preoperating expenses . 
Unamortized debt expense . . 
22 
1973 1972 
(In Thousands] 
23,709 
73,096 
96,805 
58,043 
6,566 
3,028 
164,442 
1,130,892 
515,476 
615,416 
123,915 
739,331 
1,797 
1,777 
579 
$ 45,696 
29,023 
74,719 
55,731 
5,670 
4,699 
140,819 
1,041,757 
452,918 
588,839 
98,717 
687,556 
2,789 
636 
4,153 3,425 
$ 907,926 $ 831 ,800 
 LIABILITIES AND 
STOCKHOLDER EQUITY 
CURRENT LIABILITIES: 
Current maturities of long-term 
debt. . ...... $ 
Accounts payable and accrued 
liabilities . 
Unearned transportation revenue 
Accrued income taxes. 
Total current liabilities .. 
LONG-TERM DEBT (Note 3). 
DEFERRED CREDITS (Note 5): 
Deferred Federal income taxes . 
Unamortized investment tax 
credits . 
COMM ITM ENTS (Note 4) 
STOCKHOLDER EQUITY (Notes 
2 and 6): 
Common stock, par value $3.00 
per share - Authorized 
25,000,000 shares; Outstanding 
19,866,524 shares in 1973 and 
19,828,385 shares in 1972. 
Common stock purchase 
warrants .. 
Additional paid-in capital. 
Retained earnings (of which 
$168,125,000 is restricted at 
June 30, 1973 as to the 
payment of cash dividends 
under credit agreements) . 
DELTA AIR LIN ES, INC . 
1973 1972 
(In Th ousands) 
51 ,400 
90,692 
19,114 
27,309 
188,515 
168,000 
161 ,347 
25,511 
186,858 
59,600 
6,750 
72,768 
225,435 
$ 43,896 
78,469 
17,618 
14,789 
154,77 2 
199,585 
146,881 
23,925 
170,806 
59,485 
6,750 
71 ,037 
169,365 
364,553 306,637 
$907,926 $831 ,800 
The accompanying notes are an integral part of these balance sheets. 
23 
 DELTA A IR LINES, INC. 
Statements of Income 
For the years ended June 30, 1973 and 1972 (Note 2) 
OPERATING REVENUES: 
Passenger ...... .. . . 
Cargo . . 
Other, net . . 
Total operating revenues ... . . 
OPERATING EXPENSES: 
Flying operations. 
Maintenance ......... . 
Aircraft and traffic servicing . 
Promotion and sales . . 
Passenger service ...... . .. . 
Depreciation and amortization .. .. .... . ... .. . . .. .. .. . 
General and administrative . . 
Total operating expenses .. . 
OPERATING INCOME . 
OTHER EXPENSE (INCOME): 
Interest expense .. 
Less - Interest capitalized on advances for equipment. 
Miscellaneous income, net ......... .. . . 
Gain on disposition of aircraft .. 
Merger integration costs .... 
INCOME BEFORE INCOME TAXES. 
PROVISION FOR INCOM E TAXES (Note 5) ....... . .. . . 
NET INCOME. 
NET INCOME PER COMMON SHARE (Note 1 ) . . 
Th e accompanying notes are an integral part of these statements. 
24 
 1973 
. . .... $ 960,215 
. . . . . . . . . . . 76,323 
13,161 
.. . ... .. . . . 1,049,699 
259,649 
. . . 141 ,330 
202,173 
110,452 
..... 102,153 
84,301 
28,882 
928,940 
120,759 
, 
. . .... . ' 
15,808 
(6,345) 
9,463 
(4,316) 
(4,653) 
4,024 
4,518 
116,241 
50,246 
.. $ 65,995 
$3.32 
DELTA AIR LINES, INC. 
Twelve Months 
Ended 
June 30, 1972 
1972 (Unaudited) 
(In Thousands) 
$806,068 
65,160 
12,338 
883,566 
229,807 
128,765 
167,743 
94,649 
80,357 
86,376 
28,303 
816,000 
67,566 
17,926 
(3,770) 
14,156 
(656) 
(1 ,897) 
11,603 
55,963 
27,489 
$ 28,474 
$1.44 
$817,665 
65,303 
12,661 
895,629 
231,565 
129,884 
169,534 
96,829 
81 ,136 
86,135 
28,482 
823,565 
72,064 
17,701 
(3,770) 
13,931 
(736) 
(1,897) 
11,298 
60,766 
27,539 
$ 33,227 
$1 .68 
25 
 DELTA A IR LIN ES, IN C . 
Statements of Retained Earnings 
Fo r the years e nded June 30, 1973 and 1972 (Note 2) 
1973 1972 
(In Thousands) 
BALANCE AT BEGINNING OF 
YEAR, as previously reported 
To record deficit (as restated) of 
Northeast Airlines, Inc. as of 
December 31, 1970 (Note 2) 
BALANCE At BEGINNING OF 
YEAR, as restated. 
Add (Deduct): 
Net income . . 
Cash dividends - $.50 per share 
Loss of Northeast Airlines, Inc. 
for the six months ended 
June 30, 1972 (Note 2). 
BALANCE AT END OF YEAR 
(restricted as indicated on 
.. $169,365 
65,995 
(9,925) 
$203,999 
(5 1,975) 
152,024 
28,474 
(9,570) 
(1 ,563) 
balance sheet). . . .. . . $225.435 $169,365 
The accompanying notes are an integral part of these statements. 
Auditors' Report 
ARTHU R ANDERSEN & Co. 
ATLANTA, G EORG IA 
To the Stockholders and Board of Directors 
of Delta Air Lines, Inc.: 
We have examined the balance sheets of Delta Air 
Lines, Inc. (a Delaware corporation) as of June 30, 1973 
and 1972; and the related statements of income, retained 
earnings, additional paid-in capital and changes in finan- 
cial position for the years then ended. Our examination 
was made in accordance with generally accepted auditing 
standards, and accordingly included such tests of the ac- 
counting records and such other auditing procedures as 
we considered necessary in the circumstances. The finan- 
cial statements of Northeast Airlines, Inc. for the year 
ended December 31, 1971 (which period was combined 
with Delta's results of operations for the year ended June 
30, 1972 as discussed in Note 2 to the financial statements) 
were examined by other auditors and we were furnished 
with their report thereon. 
In our opinion, based upon our examination and the 
report of other auditors, the accompanying financial state- 
ments present fairly the financial position of Delta Air 
Lines, Inc. as of June 30, 1973 and 1972, and the results 
of its operations and the changes in financial position for 
the years then ended, in conformity with generally 
accepted accounting principles consistently applied during 
the periods. 
Atlanta, Georgia, 
August 22, 197 3. 
26 
~ C2r-._ ~ < G:, , 
 DELTA AI R LINES, INC . 
Statements of Additional Paid-in Capital 
For the years ended June 30, 1973 and 1972 (Note 2) 
1973 1972 
[In Th ousands] 
BALANCE AT BEGINNING OF 
YEAR, as previously reported . . $22,450 
To record additional paid-in capital 
(as restated) of Northeast 
Airlines, Inc. as of December 
31, 1970 (Note 2) . . 39,316 
BALANCE AT BEGINNING OF 
YEAR, as restated ............... $71 ,037 61,766 
Add : 
Capital cont ributed (both cash 
and debt assumed) to 
Northeast by Storer 
Broadcasting Company, less 
amount allocated to common 
stock purchase warrants .. 
Excess of proceeds over par 
value of common shares 
issued under employee stock 
option plan (Note 6). 
Income tax reduction to 
Company resulting from sales 
by employees of common 
shares issued under stock 
option plan. 
BALANCE AT END OF YEAR. 
170 8,265 
1,126 1,006 
435 
. . $72,768 $71 ,037 
Th e accompanying notes are an integral part of these statements. 
27 
 DELTA AIR LIN ES, IN C . 
Statements of Changes in Financial Position 
For the years ended June 30, 1973 and 1972 (Note 2) 
1973 1972 
[In Th ousa nds) 
FUNDS PROVIDED BY: 
Net income. . . .. ... $ 65,995 
Add expenses not requiring cur- 
rent outlay of working capital- 
Depreciation and amortization 
Deferred income taxes . 
Investment tax credit, net. 
Other . . 
Total from operations. 
Disposition of property 
and equipment (book value). 
Long-term financing . 
Refund of SST advance ....... . . 
Common stock issued under 
employee stock option plan, 
including income tax reduction . 
Capital (cash) contributed to 
Northeast. 
Other. . ... . . . . . 
FUNDS USED FOR: 
84,914 
14,466 
1,586 
720 
167 ,681 
17,876 
5,000 
1,676 
499 
192,732 
Property and equipment additions - 
Flight equipment and advances 135,036 
Other. 18,695 
Reduction of long-term debt. 
Cash dividends. 
Preoperating expenses. 
153,731 
36,585 
9,925 
2,611 
202,852 
$ 28,474 
86,376 
12,512 
2,339 
165 
129,866 
4,073 
3,000 
1,110 
7,200 
1,962 
147,211 
80,741 
11,496 
92,237 
25,339 
9,570 
127,146 
INCREASE (DECREASE) IN 
WORKING CAPITAL $( 10,120) $ 20,065 
CHANGES IN WORKING 
CAPITAL COMPONENTS: 
Increase (decrease) in- 
Cash and short-term 
investments. 
Receivables, net. 
Other current assets. 
Decrease (increase) in - 
Current maturities of long- 
term debt . 
.. $ 22,086 
2,312 
(775) 
(7,504) 
Short-term notes payable .. 
Accounts payable and accrued 
liabilities . (12,223) 
(14,016) 
Other current liabilities . 
$(10,120) 
$ 32,100 
1,118 
480 
201 
14,910 
(11 ,571) 
(17,173) 
$ 20,065 
The accompanying notes are an integral part of these statements 
28 
 DELTA AIR LINES, INC. 
Notes to Financial Statements 
June 30. 1973 and 1972 
1. SUMMARY OF ACCOUNTING POLICIES: 
Passenger Revenue: Passenger ticket sales are 
recorded as revenue when the transportation is 
used. The value of unused tickets is included in 
current liabilities in the financial statements. 
Depreciation: Substantially all of the Com- 
pany's flight equipment is being depreciated on 
a straight-line basis to residual values (10% of 
cost) over a 10-year period from dates placed in 
service. Ground property and equipment is de- 
preciated on a straight-line basis over its esti- 
mated service life (various lives ranging from 3 
to 30 years). 
Maintenance and Repairs: All maintenance 
and repair costs, including engine and airframe 
overhauls, are charged to maintenance expense 
when incurred. Major replacements and better- 
ments are capitalized. 
Interest Capitalized: Interest on advances for 
new equipment is capitalized based on the Com- 
pany's current interest rate on long-term debt. 
Capitalization of interest ceases when the equip- 
ment is placed in service. 
Preoperating Expenses: When new aircraft 
fleets are introduced, training and other major 
costs incurred are deferred and then amortized 
on a straight-line basis generally over a period 
of two years or less. 
Retirement Plans: All of the Company's per- 
manent employees are covered under its non- 
contributory trusteed plans providing for 
retirement, disability, and survivor benefits. The 
total expense under these plans amounted to 
approximately $26,100,000 in 1973 and 
$22,500,000 in 1972. The Company's policy is to 
fund each year's accrued costs under the plans, 
which costs include amortization of prior service 
costs over a thirty-year period. At December 31, 
1972 (date of latest actuarial study), the assets of 
the plans exceeded the actuarially computed pres- 
ent value of vested benefits under the plans. 
Income Taxes: Total income taxes are provided 
by applying the applicable tax rates to book in- 
come before income taxes. (As discussed in Note 2, 
29 
 DELTA AIR LINES, INC. 
no effect has been given to income tax reductions 
resulting from Northeast's losses to August 1, 
1972.) Deferred Federal income taxes are provided 
for all significant items (principally depreciation 
and interest capitalized) where there is a timing 
difference in recording such items for financial 
reporting purposes and for income tax purposes. 
Utilized investment tax credits are amortized 
( as a reduction of the provision for income taxes) 
over the approximate life of the related equip- 
ment. (See Note 5.) 
Earnings Per Share: Net income per common 
share is computed based on the weighted average 
number of outstanding shares during the year 
(19,852,842 shares in 1973 and 19,810,495 shares 
in 1972). The 668,515 common shares issued for 
Northeast's common stock are considered as out- 
standing throughout the two years ended June 30, 
1973. Outstanding stock options and warrants 
(see Note 6) have no material dilutive effect on 
net income per common share. 
2. MERGER WITH 
NORTHEAST AIRLINES, INC.: 
On August 1, 1972, Delta's merger with North- 
east Airlines, Inc. was consummated. Delta issued 
(a) 668,515 shares of its common stock for all of 
the outstanding common stock of Northeast, and 
(b) warrants to Storer Broadcasting Company 
(majority stockholder of Northeast) to purchase 
500,000 shares of Delta common stock at $48.00 
per share on or prior to May 1, 1978, in exchange 
for Storer transferring to Delta the $40,085,000 
owed by Northeast to Storer at August 1, 1972. 
The estimated fair value of the warrants at the 
date of the merger agreement (May 12, 1971) was 
$6,750,000. 
The merger was accounted for as a pooling of 
intere$tS and, accordingly, prior financial state- 
ments of Delta have been restated. The audited 
accompanying statements of income, retained 
earnings, additional paid-in capital and changes 
in financial position for 1972 reflect the combin- 
ation of Delta's results of operations for the year 
ended June 30, 1972 with Northeast's audited 
results for its year ended December 31, 1971. 
Northeast's net loss of $1,563,000 ($.08 per share) 
30 
 I 
DELTA AIR LIN ES, IN C . 
for the six months ended June 30, 1972 was 
ch arged directly to retained earnings. 
For purposes of comp aring like operating 
periods, an unaudited statement of income re- 
flecting the combined results of operations for 
the twelve months ended June 30, 1972 h as been 
presented. 
The following tabulation reconciles Delta's 
previously reported 1972 operating revenues, net 
income and net income per share with restated 
amounts. Adjustments m ade to conform North- 
east's method of accounting for preoperating costs 
with Delta's method do not h ave a significant 
effect on restated net income for the periods 
shown. 
Operating Revenues: 
As previously reported. 
Northea~ ... .. . . . . . .... . . 
As restated . 
Net Income (Loss) : 
As previously reported . 
Northeast. 
Twelve Months 
Ended 
June 30, 1972 
1972 (U naudited) 
-----rin Th o usands) 
. . $757 ,569 $757 ,569 
125,997 138,060 
. . $883,566 $895,629 
. $ 42,169 $ 42,169 
(13,695) (8,942) 
As restated. . . . $ 28,474 $ 33,227 
Net Income Per Share: 
As previously reported . $2.20 $2.20 
As restated . 1.44 1.68 
Northeast's operating losses to August 1, 1972 
have been included in consolidated income tax 
returns of Storer Broadcasting Company. Accord- 
ing! y, no effect has been given to income tax 
reductions resulting from these losses. Net income 
per share, as restated, for 1972 would have been 
higher by approximately $.34 (audited period) 
and $.22 (unaudited period) if such income tax 
reductions had been reflected. 
Northeast's operating revenues and net loss 
for the month of July, 1972, which are included 
in the fiscal 1973 results of operations, amounted 
to $12,464,000 and $131,000 ($.01 per share) , 
respectively. 
31 
 DELTA AIR LINES, INC. 
3. LONG-TERM DEBT: 
At June 30, 1973 and 1972, the Company's 
long-term debt (including current maturities) 
was as follows: 
(a) Due banks under unsecured 
notes carrying an interest rate 
of 1 /4% above the prime rate, 
repayable in quarterly 
installments to September 30, 
1976, with $52,000,000 
payable on December 31 , 
1976 ($48,150,000 payable 
1973 1972 
(In Th ousands) 
infiscal1974) .. . .......... $177,150 $192,037 
(b) Due insurance companies 
under 6% and 7% unsecured 
notes, repayable in 
installments to December 31 , 
1979 ($3,250,000 payable in 
fiscal 1974). 
(c) Convertible Subordinated 
Debentures, 6 1 /2%, maturing 
August 1, 1986, with annual 
sinking fund redemptions of 
$1 ,100,000 beginning July 31 , 
1976 (Note 6). 
(d) Other. 
Total. .. . .. . ............. . 
Less - Current maturities .. . 
20,250 
22,000 
219,400 
51,400 
25,279 
22,000 
4,165 
243,481 
43,896 
$168,000 $199,585 
The Company will need additional long-term 
funds to partially finance future expenditures for 
the aircraft acquisition program discussed in 
Note 4. The Company has arranged for a long- 
term loan of approximately $85,000,000 from a 
syndicate of United Kingdom banks to finance 
the Rolls-Royce engines for its first 24 Lockheed 
L-1011 aircraft. In addition, the Company is 
presently negotiating a new bank credit agree- 
ment for long-term borrowings up to $300,000,000, 
of which $156,000,000 would be used to repay 
principal outstanding at June 30, 1973 under a 
present agreement. 
32 
 DELTA AIR LINES, IN C 
4. PURCHASE AND LEASE COMMITMENTS: 
At June 30, 1973, the Company had purchase 
commitments for the following aircraft and re- 
lated spare engines: 
Airc raft 
30 Lockheed L-1011 . 
26 Boeing 727-200. 
Advances Estimated 
And Other Expenditures 
Expenditures to During Fiscal 
June 30, 1973 1974through 1977 
(In Th ousands] 
.. .. . $ 96,968 $507,000 
40,825 173,000 
$137,793 $680,000 
The last 12 Lockheed L-1011 aircraft are cancel- 
lable by specified interim dates prior to October 
1, 1974. The Company has options to purchase an 
additional 6 Boeing 727-200 aircraft. 
In connection with its aircraft acquisition 
program, the Company has entered into agree- 
ments to sell its 15 Convair 880 aircraft, 13 
Douglas DC-9-14 aircraft (7 of which were de- 
livered to purchaser prior to June 30, 197 3), 4 
Douglas DC-9-31 aircraft, 7 Douglas DC-8-33 
aircraft, and related spare engines and parts. 
At June 30, 1973, the Company leased thirty- 
four aircraft at an aggregate annual rental of 
approximately $29,500,000. Leases for five of these 
aircraft expire in May, 1975, and thereafter, annual 
rentals will approximate $14,800,000 until the 
leases expire at various dates during 1981 and 
1982. Annual rentals covering ground facilities 
(terminal space, maintenance facilities, ticket 
offices, etc.) under leases expiring after June 30, 
197 4, total approximately $18,100,000. 
Operating expenses for 1973 included 
$21,200,000 for aircraft rentals, $18,600,000 for 
rental of ground facilities and $20,200,000 for 
airport landing fees. 
33 
 DELTA AIR LINES, INC. 
5. INCOME TAXES: 
The provision for income taxes for 197 3 and 
1972 consisted of the following elements: 
Current income taxes - 
Federal. ...... ... . . . . . 
State. 
Deferred Federal income taxes . 
Investment tax credits. 
Less - Amortization of utilized 
investment tax credits over 
approximate life of related 
equipment .. 
1973 1972 
(In Th ousands) 
$33,027 
1,167 
14,466 
8,076 
56,736 
(6,490) 
$11 ,949 
689 
12,512 
8,654 
33,804 
(6,315) 
$50,246 $27,489 
At June 30, 1973, all available investment tax 
credits have been utilized to reduce the Com- 
pany's Federal income taxes payable. 
The Company has filed a petition with the 
U.S. Tax Court contesting income tax deficiencies 
assessed by the Internal Revenue Service for the 
taxable years 1963 through 1965. The petition 
has been granted and the case is scheduled for 
trial later in 1973. In the opinion of management, 
the settlement of this matter will not have a 
material effect on the Company's financial 
position. 
34 
 DELTA AIR LINES, IN C . 
I 
.. 
6. COMMON STOCK: 
At June 30, 1973, the Company had 1,113,116 
1 shares of common stock reserved for future is- 
suance of stock options (525,116 shares), stock 
purchase warrants (500,000 shares at $48 per 
~ share) and conversion of Convertible Subordi- 
nated Debentures (88,000 shares at $250 per share). 
Under the Company's Qualified Stock Option 
Plans for 600,000 shares of common stock, options 
for 224,250 shares have been granted and options 
for 149,741 shares were outstanding at June 30, 
, 1973 (10,675 shares at $34.75 per share, 7,016 
shares at $34.50 per share, 7,050 shares at $30.25 
per share and 125,000 shares at $51.75 per share). 
In addition, stock options assumed from North- 
east for 37 5 shares were outstanding. Transactions 
during 1973 and 1972 were as follows: 
Option Shares 
1973 1972 
Outstanding at beginning of year. 67,505 99,250 
Assumed from Northeast. 3,375 
Granted .. . . . . . . . . . ' 
. . . . . 125,000 
Exercised .. (38,139) (34,870) 
Expired .. (4,250) (250) 
Outstanding at end of year. 150,116 67,505 
Exercisable at end of year. 18,304 49,068 
Common stock transactions during 1973 and 
1972 were as follows: 
Outstanding at beginning 
of year, as previously 
reported . 
Issued for common stock 
of Northeast. 
Outstanding at beginning 
of year, as restated . . 
Exercise of employee 
stock options. 
Common Shares 
1973 1972 
19,125,000 
668,515 
. 19,828,385 19,793,515 
38,139 34,870 
Outstanding at end of year ..... 19,866,524 19,828,385 
35 
 DELTA AI R LINES, INC. 
Five Years of Delta Air Lines Growth Years ended June 30 
(Dollars expressed in thou sands except per share figu res) 
AS PREVIOUSLY REPORTED: 
Operating revenues. 
Net income ... .. . . . . . . .. . .. ... _ . . . 
Net income per share. 
AS RESTATED TO REFLECT POOLING OF 
NORTHEAST AIRLINES, INC (1 ): 
Operating revenues 
Passenger 
Cargo ... . . .... . . . 
.. . . $ 960,215 
76,323 
Other, net. . . . . . . . 13,161 
Total operating revenues. 
Operating expenses. 
. . . . . . . . ... . . . . $1 ,049,699 
. . . . . . . . . 928,940 
Operating income . .. . . .. . .. . 
Interest expense, etc , net . . . .. . . . . .. . 
Gain (loss) on disposition of aircraft . 
. .$ 120,759 
9,171 
4,653 
Income before taxes and extraordinary items ... $ 11 6,241 
Income taxes. . 50,246 
Income before extraordinary items . . . .. . . . . .. $ 65,995 
Extraordinary items ($.04 and $.36 per share) . 
Net income . . . . .. .... . . .. . . . . _ .. ... $ 65,995 
$3.32 
Net income per share . ... . . . . . .... ... . 
Dividends paid ......... . .. . . . ..... . . 
Dividends paid per share . . . . .... . . . 
$9,925 
$.50 
Stockholder equity. . . . . . . . . . . . . . . . . . . . . . $ 364,55 3 
Stockholder equity per share. . . . . . . . . . . . . . . $1 8.35 
Shares of common stock outstanding . . 19,866,524 
Revenue passengers enplaned .... 23,702,870 
Available seat miles (000). ...... . .... . . ... . . 27,958,095 
Revenue passenger miles (000). . . .. . .. ... . 14,449,748 
Passenger load factor.. . . . . . . . . . . . . 51.68% 
Break-even load factor. 45 .18% 
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. 
3,815,285 
1,711 ,229 
6.65q; 
3.32Q: 
24 _ 
35q; 
( 1) The restated amount s and statistical data for years 1969 through 
1972 combine Delta-only results of operations for the four years 
ended J une 30, 1972 with Northeast's re sults for the fo ur years 
ended Dece mber 31 . 1971 . (See Note 2 to Financial Statement s) 
36 
$757,569 
$ 42,169 
$2.20 
$806,068 
65,160 
12,338 
$883,566 
816,000 
$ 67,566 
13,500 
1,897 
$ 55,963 
27,489 
$ 28,474 
$ 28,474 
$1.44 
$9,570 
$.50 
$306,637 
$15.46 
19,828,385 
20,562,953 
26,018,780 
12,433,986 
47 .79% 
43.80% 
3,613,790 
1,482,453 
6.48q; 
3 _ 
14q; 
22.58q; 
1971 
$66 1,246 
$ 29,994 
$1.57 
$7 13,665 
60,097 
10,320 
$784,082 
735,605 
$ 48,477 
15,699 
$ 32,778 
12,419 
$ 20,359 
(700) 
$ 19,659 
$.99 
$9,562 
$.50 
$278,239 
$14.06  
19,793,515 
18,880,818 
24,838,909 
11 ,575,358 
46 .60% 
43.40% 
3,403,838 
1,381,954 
6.17q; 
2.96q; 
21 .61q; 
DELTA AI R LINES, INC . 
1970 
$622,129 
$ 44,527 
$2.33 
$679,018 
56,615 
8,585 
$744,218 
669,429 
$ 74,789 
18,477 
(227) 
$ 56,085 
33,511 
$ 22,574 
(7,224) 
$ 15,350 
$.78 
$7,650 
$.40 
$257,142 
$12 .99 
19,793,515 
18,830,393 
22,820,681 
11 ,232,679 
49 .22% 
43.76% 
3,094,437 
1,323,265 
6 05(1; 
2.93(1; 
21 63(1; 
$516,113 
$ 39,19 1 
$2.05 
$573,136 
46,842 
7,840 
$627,818 
547,321 
$ 80,497 
12,429 
61 1 
$ 68,679 
33,305 
$ 35,374 
$ 35,374 
$1 .79 
$7,650 
$.40 
$230,473 
$11 .64 
19,793,515 
17,101 ,623 
18,509,976 
9,979,663 
53 .92% 
46.37% 
2,506,394 
1,152,193 
5.74(1; 
2 96(1; 
21 84(1; 
37 
 DELTA AI R LINES, INC. 
Board of Directors 
R. W . FREEMAN Chairman of the Finance Committee 
N ew Orleans, Louisiana 
C.H. DOLSON Chairman of the Ex ecutive Committee 
Atlanta, Georgia 
W . T. BEEBE Atlanta, Georgia 
B. W . BIEDENHARN M onroe, Louisian a 
R. W . COURTS Atlanta, Georgia 
EMERY FLINN Miami, Florida 
DAVID C . GARRETT, JR. Atlanta, Georgia 
EDWARD H . GERRY New York, N ew York 
C HARLES H . KELLSTADT Miami, Florida 
JOHN R. LONGMIRE St. Louis, M issouri 
R. S. MAURER Atlanta, Georgia 
BILL MICHAELS Miami, Florida 
T. M . MILLER Atlanta, Georgia 
ROBERT OPPENLANDER Atlanta, Georgia 
STUART W. PATTON Miami, Florida 
CARLETON PUTNAM Washington , D .C. 
GEORGE M . SNELLINGS, JR. M onroe, Louisiana 
38 
 DELTA AIR LINES, INC. 
Officers 
W . T. BEEBE Chairman of the Board & Chief 
Executive Officer 
DAVID C. GARRETT, JR. President 
FINANCE 
ROBERT OPPENLANDER Senior Vice President- Finance & Treasurer 
W . A. ATCHISON Vice President-Computer Services 
M . 0 . GALLOWAY Vice President-Comptroller 
PAULW. PATE 
J. D . DUNN 
J. R. HOWELL 
HUGH H . SAXON 
Vice President- Properties* 
A sst. Vice President- Purchasing 
A sst. Treasurer 
A ss t. Treas urer 
LE GAL & CORPORATE AFFAIRS 
R. S. MAURER 
MORRIS SHIPLEY 
J. W . CALLISON 
A. C. FORD 
FRANKF. ROX 
GEORGE E. SHEDD 
SIDNEY F. DAVIS 
IKE LASSETER 
MA RKETING 
T. M. MILLER 
SHELBY D. DEMENT 
C HARLES P. KNECHT 
J. A. COOPER 
R. L. GIBSON 
J. T. MAPLES 
J. W . MEYER 
HENRY ROSS 
O PERATIONS 
HOYT T. FINCHER 
E. L. HAMNER 
D . P. HETTERMANN 
C. A. SMITH 
J. K. BURNETTE 
JOHNP. DAVIS 
HOLLIS L. HARRIS 
JACKS. KING 
W . L. MILLER 
J. F. NYCUM 
L. G. RODEFELD 
C. B. WILDER 
PERSONNEL 
R. W . ALLEN 
R. H . WHARTON 
J. A. YORK 
*Retired July 1, 1973 
**Retired February 15, 1973 
Senior Vice President- General Counsel 
& Secretary 
Vice President-Government Affairs 
A sst. Vice President- Law 
A sst. Vice President-Long Range Planning 
A sst. Vice President- Law 
A sst. Vice President-Public Relations 
A sst. Secretary & A sst. to Gen eral Counsel 
A sst. Secretary 
Senior Vice President-Marketing 
Vice President-Marketing Administration 
Vice President-Sales 
A sst. Vice President-Marketing 
A sst. Vice President- Traffic Administration 
A sst. Vice President- Marketing Planning 
A sst. Vice President-Customer Relations 
A sst. Vice President-Sales Promotion 
Senior Vice President- Operation s 
Vice President-Stations 
Vice President-Technical Operations 
Vice President-Flight Operations 
Asst. Vice President-Quality Con trol. 
A sst. Vice President- Maintenance 
A sst. Vice President-In-Flight Services 
A sst. Vice President-Flight Control 
A sst. Vice President-Material Services 
A sst. Vice President-Flight Equipment 
Development 
A sst. Vice President-Communications 
Asst. Vice President-Operations 
Administration* 
Senior Vice President- Personnel 
Asst. Vice President- Employee Relations*' 
A sst. Vice President- Employee Services 
39 
 DELTA AIR LINES, IN C. 
Transfer Agent and Registrar 
The Citizens and Southern National Bank 
99 Annex 
Atlanta, Georgia 30399 
Common Stock 
Listed on the New York Stock Exchange 
Auditors 
Arthur Andersen & Co. 
Annual Meeting 
October 25, 1973, Monroe, Louisiana 
Notice to the Stockholders of Delta Air Lines, Inc. 
Part 245 of the Economic Regulations of the Civil 
Aeronautics Board provides that: (1) any person who 
either owns, as of December 31st of the year preceding 
issuance of this annual report, or subsequently acquires, 
beneficially or as trustee, more than 5%, in the aggregate, 
of any class of the capital stock or capital of Delta Air 
Lines, Inc., shall file with the Board a report containing 
the information required by Sec. 245.12 of Subpart 245, 
on or before April 1, as to the capital stock or capital 
owned as of December 31 of the preceding year, and, in 
the case of stock subsequently acquired, a report under 
Sec. 245.13, within 10 days after such acquisition, unless 
such person has otherwise filed with the Board a report 
covering such acquisition or ownership, (2) any bank or 
broker covered by ( 1), to the extent that it holds shares as 
trustee on the last day of any quarter of a calendar year, 
shall file with the Board, within 30 days after the end of 
the quarter, a report in accordance with the provisions of 
Section 245.14; and (3) any person required to report under 
this subpart who grants a security interest in more than 
5% of any class of the capital stock or capital of Delta Air 
Lines, Inc. shall within 30 days after granting such security 
interest file with the Board a report containing the 
information required in Section 245.15. Any stockholder 
who believes that he may be required to file such a report 
may obtain further information by writing to the Director, 
Bureau of Operating Rights, Civil Aeronautics Board, 
Washington, D.C. 20428. 
Delta Air Lines, Inc. 
General Offices, Hartsfield Atlanta International Airport 
Atlanta , Georgia 30320 
40