~ .Delta Air Lines 
1998 ANNUAL REPORT 
  BUSINESS DESCRIPTION 
Delta Air Lines, Inc. provides scheduled air transportation over an extensive route network. Based on calendar 1997 data, the 
Company is the largest U.S. airline in terms of aircraft departures and passengers enplaned, and the third largest U.S. airline as 
measured by operating revenues and revenue passenger miles flown. Delta is the leader across the North Atlantic, offering the 
most daily flight departures, serving the largest number of nonstop markets and carrying the most passengers of any U.S. airline. 
As of August 1, 1998, the Company provided scheduled air service to 148 cities in 42 states, the District of Columbia, 
Puerto Rico and the U.S. Virgin Islands, and to 46 international cities in 31 countries. With its domestic and international 
code-share partners, Delta's route network covers 231 domestic cities in 48 states, and 118 international cities in 59 countries. 
In addition to scheduled passenger service, the Company provides air freight, mail and related aviation services. 
Delta is incorporated under the laws of the State of Delaware and is subject to government regulation under the Federal 
Aviation Act of 1958, as amended, as well as many other federal, state and foreign laws and regulations. The Company's 
corporate headquarters is in Atlanta, Georgia. 
OPERATING REVENUE PER AVAILABLE SEAT MILE 
In Cents 
::1 9.33 
9.53 
9.94 
10.09 
1998 
8.00 8.75 9.50 10.25 11.00 
Unit revenue increased 2% due primarily to record passenger traffic levels, 
increased contributions from cargo and other non-passenger revenue. 
OPERATING INCOME * 
In Billions of Dollars 
1.6 
:: :r-==-==-==-==-==:=::- 
0 
. _ 
7 
___________________ 
1._ 
3 __ 
1998 . 
, - - - - - - - - - - - - - - - - 
1.7 
0 0.5 1.0 1.5 2.0 
A strong revenue performance combined with solid cost control drove 
record operating income of $1.7 billion. 
SHAR E OWNERS ' EQUITY 
In Billions of Do!lars 
:: : 
1;:;:;:;:;:;:;::_ 
/ 
: 
_ 
8:_- 
::_- 
::_- 
_ 
2 
: 
.5 
:~ 
-3- 
.0--------- 
1998 . 
, - - - - - - - - - - - - - - 
4.0 
I 
2 3 4 5 
Record net income of $1.0 billion in fiscal 1998 increased shareowners' 
equity by 33% to $4.0 billion. 
OPERATING COST PER AVAILABLE SEAT MILE* 
In Cents 
:::1 
8.83 
8.54 
8.18 
8.88 
1998 
8.00 8.15 9.50 10.25 11.00 
Unit cost increased slightly despite significant investments in customer 
service. Lower aircraft fuel prices contributed to the strong cost performance. 
DILUTED INCOME PER COMMON SHARE * 
In Dollars 
;:-1 
4.01 8.51 
11.44 
12.68 
1998 
3 6 9 12 
Record net income for the third consecutive year resulted in an 11 % 
increase in diluted income per common share. 
:: I 
1998 
0 
LONG-TERM DEBT AND CAPITAL LEASES 
In Billions of Dollars 
---------------3.3 
-----------2.3 
- - - - - - - - - - 2. 1 
-------- 1.9 
I 
2 3 
15 
4 
Scheduled debt repayments and voluntary debt repurchases have reduced 
total long-term debt and capital leases by 40% since fiscal 1995. 
*Excludes restructuring and other non-recurring charges and the cumulative effect of an accounting change. 
FINANCIAL HIGHLIGHTS 
F ISCAL Y EAR ENDED J UNE 3 0 , 1998 
Dollar amounts in millions, except per share data. 
Excludes restructuring and other non-recurring charges. 
Operating Revenues 
Operating Expenses 
Operating Income 
Operating Margin 
Net Income 
Basic Income Per Common Share 
Diluted Income Per Common Share 
Dividends Declared on Common Stock 
Dividends Per Common Share 
Common Shares Issued and Outstanding at Year End 
Debt-to-Equity Position 
Passenger Mile Yield 
Operating Revenue Per Available Seat Mile 
Operating Cost Per Available Seat Mile 
O PERATING H IGHLIGHTS 
FI SCAL Y EAR E NDED J UNE 30, 1998 
Excludes restructuring and other non-recurring charges. 
Revenue Passengers Enplaned (Thousands) 
Revenue Passenger Miles (Millions) 
Available Seat Miles (Millions) 
Passenger Load Factor 
Breakeven Passenger Load Factor 
Cargo Ton Miles (Millions) 
Cargo Ton Mile Yield 
Fuel Gallons Consumed (Millions) 
Average Aircraft Fuel Price Per Gallon 
Number of Aircraft in Fleet at Year-End 
Average Age of Aircraft Fleet at Year-End (Years) 
Stage 3 Aircraft at Year-End (As a Percent of Total Aircraft) 
Average Seats Per Aircraft Mile 
Average Passenger Trip Length (Miles) 
Average Aircraft Flight Length (Miles) 
Average Aircraft Utilization (Hours per Day) 
Full-Time Equivalent Employees at Year-End 
1998 
$ 14,138 
$ 12,445 
$ 1,693 
12.0% 
$ 1,001 
$ 13.28 
$ 12.68 
$ 15 
$ 0.20 
75,225,197 
32%/68% 
12.83 
10.09 
8.88 
1998 
104,148 
101,136 
140,149 
72.2% 
62.8% 
1,745 
33.35 
2,664 
56.54 
569 
12.3 
81% 
180 
971 
804 
8.7 
70,846 
$ 
$ 
$ 
$ 
$ 
$ 
$ 
$ 
1997 ___ Change 
13,594 
12,011 
1,583 
11.6% 
886 
11.81 
11.44 
15 
0.20 
73,695,987 
41 %/59% 
12.79</: 
9.94</: 
8.78</: 
1997 
101,147 
97,758 
136,821 
71.4% 
62.4% 
1,532 
36.14</: 
2,599 
66.23</: 
553 
11.8 
71% 
181 
966 
789 
8.6 
65,383 
4% 
4% 
7% 
0.4 pts. 
13% 
12% 
11% 
2% 
NA 
2% 
1 % 
Change 
3% 
3% 
2% 
0.8 pts. 
0.4 pts. 
14% 
(8%) 
3% 
(15%) 
3% 
4% 
10.0 pts. 
(1 %) 
1 % 
2% 
1% 
8% 
 LETTE R TO SHAREOWNERS 
DEAR SHAREOWNERS: YOUR COMPANY, 
BY ALMOST ANY MEASURE, HAD A GREAT 
YEAR IN FISCAL 1998, AND WE ARE EXCITED 
ABOUT WHAT IS AHEAD. THIS PAST YEAR 
WE RESUMED A JOURNEY, SOMEWHAT 
INTERRUPTED BY EARLY 1990S ECONOMIC 
TURMOIL, WITH A CLEAR VIEW TO OUR 
DESTINATION: W E WANT TO BUILD THE 
BEST AIRLINE IN THE WORLD. 
In this letter, I would like to tell you about what we've 
done this year and what we plan to do. I'll touch briefly 
on recent accomplishments and what those accomplish- 
ments mean to you, our owners. I'll share with you 
our plans to strengthen Delta's partnerships with key 
constituents - our customers, our employees, and you, our 
owners. And I'll tell you about some other important 
partnerships - our alliances with other airlines around 
the world and how they position us strategically to suc- 
ceed in a competitive global industry. Continued on page 2 
Leo F. Mullin 
President and Chief Executive Officer 
 HAR 
A 
Delea i a proud airline built on ch fin c rv1 tradi- 
cion . How v r at ch tart of fi cal 1998 the erv1 e 
foundacion had b n hak n. Difficult onorru ondi- 
cion in ch arly 1990 r quired that D lea, during ch 
fir c half of chi decad tak o t r du tion a tion 
to ounter ch ompany' w ak finan ial performan 
Th a tion , while ne e ary, threat n d Delea' or 
valu of high employ moral and ptional rv1 
We began fiscal 1998 with a red dication to our 
employe and to our cor efVl valu . We ar pleased 
to report chat ch e effort are paying off: 
 Employee morale improved dramatically as D lea p o- 
ple regained onfiden in the ompany' rv1ce om- 
mi tment and future as measured by an independ nt 
urvey company. cati ti how chat ov rail employe 
aci faction improved by a remarkable 20 percent 
from 1996 to 1998. 
 Delta's on-time performance over the past twelve 
months has taken ch Company from an unacceptable 
tench place to our current consi tent ranking among 
the industry' top performer . In fact, Delea was fir t 
among hub-and-spoke carriers for June and July. In 
another key area of operacional performance, Delta has 
one of the highest completion races - lowe t number 
of canceled flights - among hub-and-spoke carriers. 
 Baggage delivery performance has improved chis 
past year, placing Delea back in the top tier of the 
industry. For the month ofJune, Delea ranked first 
in baggage handling. 
 Delta's Crown Room Clubs received recognition 
from Conde Nast as best domestic airline club in 
the business. 
2 DELTA AIR LINES 
W NE R NT IN U 
RE 
In Billions of Dollars 
1989 
1998 
'--------'-----------'---------' 
0 2 3 
 Ground Property and quipment  Flight Equipment 
(including certain leased aircraft) 
trong operating cash flows provide the foundation for customer 
service investments, fleet simplification and rationalization and 
disciplined growth. 
Mor than anything else, these accompli hments and 
chi progr are the result of excellent performance by 
Delta mployee aero the board. Our gain were also 
upport d by major incr ase in expenditures for phys- 
ical improvements. Most importantly, Delea launched 
in October a program co refurbish within 16 months 
ch interior of all Delea airplanes - interiors chat had 
been allowed to become exceedingly run-down during 
the period of co t reduction. Today, more than 50 per- 
cent of Delea' plane have new interiors, and we are 
on chedule to complete all refurbi hments by April 
1999. In addition, Delea has upgraded 19 of 47 Crown 
Room Club , and significant ocher facility improvements 
have been made at more than 50 percent of Delta's 
terminals. All of chis was done in a cost effective way 
so chat Delta maintained its hard-won efficiency 
advantage relative co competitors. 
WHAT THAT MEANS TO You 
For you, our shareowners, these efforts generated a record 
financial performance in fiscal 1998. Earnings, for the 
first time in Delta's history, reached $1 billion, and oper- 
ating cash flow was close to $3 billion. The strength of 
our financial posicion allowed the Company to announce 
a $750 million Common Stock repurchase program to 
be carried out during calendar years 1998 and 1999. 
 LETTER TO SHAREOWNERS (CO NTINU ED) 
1995 
1996 
1997 
1998 
0 
DELTA AIR LINES COMMON STOCK PRICE * 
In Doll.ars 
73 
83 
82 
1291/4 
I I I I 
30 60 90 120 
~closing price on NYSE on June 30 
150 
Delta's Common Stock price appreciated 57 % in fiscal 1998, compared 
to 28% for the S&P 500 Index. 
Ultimately, of course, the value of corporate perform- 
ance must be reflected in stock price increases. Delea 
performed well in chis regard in fiscal 1998. From July 1, 
1997, co June 30, 1998 (our fiscal year), Delta's stock 
price increased from $82 to $129. Delea has, however, 
been subject co the market swings of the recent widespread 
stock market turmoil, which caused a significar1c decline 
in stock price. Nonetheless - and an important positive 
for the future - Delta's stock price multiple now exceeds 
the average of the ocher major hub-and-spoke carriers. 
We are proud of these accomplishments, but more 
importantly, we believe chat this is just the beginning. 
BUILDING PARTNERSHIPS 
Even as fiscal 1998 for Delea was about stabilization 
and building momentum, the coming year is about 
acceleration - building stronger partnerships with our 
customers, employees and shareowners. 
 Customer bonds - building positive exceptions while 
eliminating the negative. Delta's service traditions 
were built on unique relationships with our customers. 
During close to 70 years of doing business, we have 
always understood the value of special touches and 
the personal satisfaction chat comes from acts of 
service kindness. They are the very fabric of your 
Company's culture. 
Our focus in the year ahead is to re-ignite and reward 
chis passion in Delta people for the extraordinary and 
the special. Similarly, we will work relentlessly co mini- 
mize unpleasant experiences. We cannot prevent adverse 
weather or air traffic congestion. However, we can do 
a better job of managing delays when they occur. We 
can serve you promptly, treat you courteously, and 
keep you informed. Our journey to excellence man- 
dates that commitment as we seek to give you, the 
customer, an exceptionally positive experience on every 
flight you cake. 
We also are redoubling our efforts to maintain the 
gains we have made by traditional industry measure- 
ments of customer satisfaction. Thus, for example, we 
are working to make on-time a consistent part of flying 
Delta and co continue getting your bags there on time. 
 Our employee partnership - the centerpiece of success. 
Delta's ability to accelerate the pace of success is in the 
able hands of our team, which includes every flight 
attendant, pilot, customer service agent, mechanic, 
reservation sales agent, baggage agent, and administra- 
tive person. Creating a true service powerhouse requires 
chat each team member be world class and chat the 
team function cohesively. Our supporting philosophy 
is quite simple. We wane Delea people co receive top-of- 
induscry compensation for top-of-industry perform- 
ance and productivity. This standard requires service, 
operational, and financial accountability. 
This coming year, we are asking Delta's entire team 
to focus on building the positive service experiences 
chat our culture is uniquely positioned to provide. At 
the same time, we muse remind each ocher that every 
service breakdown impacts every one of us and neutral- 
izes the countless instances of service excellence. We 
can never forget chat while we - along with the media 
and the U.S. Department of Transportation - measure 
statistics, our customers relate solely to experiences. 
1998 ANNUAL REPORT 3 
 L 1 T R T HAR W N R NT L NUE 
 Shareowner rewards - sustaining and buiUing value. 
The reward of a winning organization are maniD t d 
in harehold r r turns. Delta h thr finan ial obj - 
ti e for enhancing har owner value. 
J. We are working to a eel rate our earning growth and 
cash return by building on our trategi hub trength , 
by inve ting in r venu nhan ing technology, and 
by vigilantly attacking wa te. 
Atlanta i arguably th world' mo t important air- 
port hub, with more connecting pas enger tl1an any 
other ingle facility. The Atlanta Worldport offer not 
only unparalleled a ce to the entire U. . but also 
non top ervice to key market in Europe, Latin 
America and Asia. imilarly, Delta' key hub in New 
York Cincinnati, alt Lake icy, and Dallas/Fort Worth 
are increasing their collective contributions. trategi- 
cally, the ompany's hub-and- poke y tern is trong. 
Regarding technology, we mu t acknowledge that 
earlier this decade, Delta fell well behind it competi- 
tors in technological capabilitie . That ituation i 
rapidly being rectified. We have significantly reori- 
ented our technological effort - both in prioritie 
and in pending - without increasing technology- 
related expenditures. We've made major technolog- 
ical improvements in seat inventory control, flight 
cheduling and yield management. As a re ult, Delta's 
previously lagging revenue per available seat mile has 
reached industry average - with more improvement 
NET I COME 
In Millions of Dollars 
::1 294 
662 
886 
1,001 
1998 
0 300 600 900 1,200 
&clu,us restructuring and other non-recurring charg~ and the cumul.ative effect of an accounting change. 
Strong demand for Delta's product and favorable fuel prices were catalysts 
for the Company's first $1.0 billion year. 
4 DELTA AIR LINES 
ATLANTA AVERAGE DAILY DEPARTURES 
AND NONSrOP MARKEfS' 
125 650 
122 
120 
633 
625 
IJ5 600 
IJ0 575 
105 550 
1995 1996 1997 1998 
 Nonstop Markets  Departures 
'Effictwe December 1 
Delta is leveraging Atlanta's superior geographic position and the hub's 
powerful ability to connect passengers to build Atlanta into a Worldport 
with comprehensive coverage to the world's most important markets. 
expected. In addition, Delta will begin this fall to 
roll out a treamlined and simplified gate and board- 
ing proces . Year 2000 is ue are clearly documented; 
the change needed for readiness are well underway. 
Technology - far too long a weakness at Delta - is 
quickly becoming a strength. 
On the expenditure side, our priority is the cus- 
tomer. We want our customers to see and feel the 
concrete results of our expenditures in the services 
we deliver. We are working to eliminate redundan- 
cies and unnecessary activities, ridding ourselves of 
bureaucracies that complicate the travel life of the 
customer and weigh us down in our efforts to pro- 
vide the best service. We want to focus our great 
Delta talent on core activities like flying, maintenance 
and customer service, all central to our franchise. 
2. We are working to protect and maximize our strong 
balance sheet. Our financial strength allowed the 
establishment of a $750 million Common Stock 
repurchase program. At the same time, Delta main- 
tained investment-grade credit status and provided 
fully adequate resources to invest for the future. 
 LETTER TO SHAREOWNERS (CONT I NUED) 
3. We are particularly emphasizing efforts to improve 
our fixed-to-variable cost mix. While we are cautiously 
optimistic about general economic conditions, we 
nonetheless are aggressively looking to minimize our 
fixed costs and avoid staffing our business for the peaks. 
This is not only good for shareowners, it is also key 
to protecting the security of permanent Delta jobs. 
ALLIANCES: STRATEGIC 
POSITIONING FOR A 
GLOBAL INDUSTRY 
The airline industry is increasingly global. All major 
airlines want to appeal to their customers on the basis 
of their ability to get customers from anywhere to every- 
where. Yet no carrier alone has that capability. 
Alliances among airlines have emerged as an increas- 
ingly important response to the challenge. Delta made 
substantial progress in fiscal 1998 on this front. Our 
Atlantic Excellence alliance, which has the advantage 
of anti-trust immunity, was increasingly successful in 
strengthening our European services. This strength was 
supplemented by the new code-share with Air France, 
a direct outgrowth of the successful U.5.-France bilateral 
negotiation in which Delta played an important part. 
We are moving to develop a stronger alliance position 
in Latin America through an expanded marketing alliance 
with Aeromexico. And in Asia, our position was enhanced 
immensely by the successful U.5.-Japan bilateral negoti- 
ation that allowed, for the first time, direct Delta flights 
between Atlanta and Tokyo. 
The alliance evolution is also important domestically. 
T he key step in this regard has been the establishment 
of a broad-gauged marketing relationship with United 
Airlines. This relationship has reciprocity of frequent 
flier programs as its most important component, and 
both Delta and United intend to seek other customer 
initiatives over time to build the market positions of 
both airlines through this partnership. 
Delta will proceed aggressively with worldwide alliance 
discussions in the future, not just because alliances are 
desirable from a business standpoint - although they are - 
but also because we must. Airline alliances are revolution- 
izing the nature of worldwide competition, and Delta 
intends to be a leader as these changes occur. Fortunately, 
Delta's strategic position and the capabilities of our peo- 
ple are so strong that Delta clearly has the opportunity 
to chart its own destiny as competitive changes unfold. 
In summary, we have just finished a great year, set- 
ting many new milestones for Delta. As we go forward, 
we are committed to accelerating the pace of our success 
by building on our key partnerships with our customers, 
employees, investors and alliance partners. 
The Delta management team is exhilarated to be 
on this journey with you, and we thank you for your 
continued support. 
Leo F. Mullin 
President and Chief Executive Officer 
September 1, 1998 
1998 "lNUA.L REPORT 5 
 Partner with 
ustomers 
Delta will build customer loyalty through a total commitment to quality service. 
Deltas partner hip commitment with customers is 
traightforward- be the b t airline in the world in their 
e e . Delta will work hard to provide a safe, on-time, 
comfortable and ha le-free travel experience delivered 
by courteou profe sional Delta people. Delta' com- 
mitment i to quality ervice through flawless execution 
each and every day. 
SAFETY 
Safety is Delta' first priority. Today, the airline is an 
extraordinarily safe organization with no tolerance for 
errors. Building on this firm base, Delta will enhance 
safety further by utilizing leading-edge tools and tech- 
nology, such as: 
 Enhanced Ground Proximity Warning Systems 
 Cargo bin fire detection and suppression 
 Advanced flight data recorder 
 Head-up cockpit display units 
 On-board heart defibrillators and enhanced 
emergency medical kits 
PERFORMANCE STATISTICS 
The airline industry uses three key performance statistics 
to measure customer service: on-time arrivals, mishan- 
dled baggage reports and consumer complaints reported 
to the U.S. Department of Transportation (DOT). 
Delta's goal is to be at, or very near, the top of the 
industry in all these measures. 
6 DELTA AIR LINES 
DELTA ON - TIME ARRIVAL RANKING 
Major Carriers 
]un97 =:= 10th 
ep97 8th 
Dec97 6th 
Mar98 4th 
jun 98 
10 9 8 7 6 5 4 3 
2nd 
2 
Delta's year-over-year on-time arrival performance improved in 10 out of 
12 months in fiscal 1998, allowing the ompany to move into the upper 
tier of the DOT rankings. In June 1998, Delta ranked #2 among the 10 
major carriers and #1 among the major network carriers (AA, CO, DL, 
NW, UA, US). 
Delta is committed to becoming the on-time leader 
among major network carriers. During fiscal 1998, the 
Company made rapid improvements in this area by 
developing an integrated, cross-divisional team which 
focused on every aspect of on-time performance - from 
the development of flight schedules to the day-to- 
day execution and management of the schedule. This 
improvement is a tribute to the team and the thousands 
of Delta people responsible for daily flight operations. 
An on-time operation contributes to a better bag- 
gage handling performance, which is also critical to 
Delta's customer partnership. Frontline employees 
from around the system have developed and imple- 
mented solutions to improve baggage handling. The 
employees adopted a back-to-basics approach with 
renewed attention to communication, training and 
accountability. The result: a strong move to the top 
of the industry in 1998. 
 Ensuring a smooth, comfortable and on-time travel experience for 
passengers requires mapping an optimal flight plan. 
8 
4 
MISHANDLED BAGGAGE AND ENPLANEMENTS 
Percent Change for the 12 Months Ended June 1998 
64 
5.7 
2.9 
0 f--- - ----- - ------ - - - 1 - - - - - 
-4 
-5.4 
-8 L.,_ _ _ _ _ _ _ _ _ _ _ __JL_ _ _ _ _ _ _ _ _ _ _ _J 
Delta 
 Mishandled Baggage 
Major Carriers 
 Enplanements 
In fiscal 1998, Delta reduced the total number of mishandled bags by 
5% despite 3% more passengers, while total mishandled bags for major 
carriers increased more than total passenger growth. Delta's year-over-year 
mishandled baggage rate improved every month of fiscal 1998 and Delta 
ranked # 1 among major carriers in June 1998. 
To become the best airline in the world to its customers, Delta must deliver 
a hassle-free travel experience every time. 
1998 ANNUAL REPO R T 7 
 PARTN R WITH U T M ER NT I NU D ) 
A winning partn r hip with cu tom r m an fewer 
complainr.s. D lea' improv m nt.s in on-time p rformanc 
and baggag handling hav olidifi d D lea's 1 ad r- 
hip po ition among major network carri r in thi 
mo t ba ic mea ur of ustom r ati fa tion. 
6197 
9197 
12197 
3198 
6/98 
6 
I 
5 
Major Network Carriers 
I I 
4 3 
'DOT Quarterly Average 
T RANK  
2nd 
I I 
2 
1st 
1st 
1st 
1st 
Delta consistently ranks in the top tier of major network carriers for lowest 
consumer complaint statistics, placing either # 1 or #2 in 10 out of 12 
months during.fiscal 1998. For the same period, Delta's consumer com- 
plaint rate was 6% Lower than the average for major network carriers. 
AIRPORT FA C ILI T I E A D 
AIR R FT l TE RIOR 
Customer expect and deserve clean, modern and effi- 
cient terminal facilities and Crown Room Clubs. Delta 
has renovated concourses and gate areas at 72 cities and 
will complete similar work at an additional 67 cities by 
June 1999. The Company has also completed improve- 
ments at major Crown Room Clubs, adding modern 
conference rooms and catering services. In fi cal 1998, 
Conde Nast named Delta's Crown Room Clubs the 
best in the business among domestic carriers. 
Delta is also refurbishing the interiors of its aircraft, 
including installation of new curtains, carpets and seat 
covers. More than 50 percent of the targeted fleet has 
been refurbished and 100 percent will be complete 
by April 1999. 
8 DELTA AIR LINES 
Q u r K AND EA y TRAN A T I N 
K y to a strong partn r hip i Ii t ning to cu comers 
and d igning Delta' a tivitie and product to meet 
their n d . New and faster pro es to upgrade, refund 
and rei sue ticket have b n impl m nted. Over the 
n xt two y ar , cu comer will exp rienc a treamlined 
check-in proc back d by new technology and more 
effici nt gate and boarding procedur . New hand-held 
gate reader will u e bar cod anning technology to 
update information automatically and peed the proce s 
of pas nger check-in and aircraft b arding. 
Dr TRIBUTION INITIATIVE 
A commitment to quality ervi e includes answering 
telephone reservation line promptly. ustomers are 
experiencing improved service l v l as a re ult of a 
commitment to new technology, proce improvements 
and increased staffing. In fi cal 1999, Delta will open 
three new reservation ale atellite call centers with 
advanced telecommunication technology to add cost- 
effective call-handling capacity. 
Three new reservation sales satellite call centers will open in fiscal 1999 
and will further improve service L 
evels. 
 Delta is investing heavily in pilot training and leading-edge technology, such as flight simulators to emphasize the number one priority - customer safety. 
Delta is also making it easier for customers to book 
travel by adding and expanding alternative customer ser- 
vice channels, such as the Internet. The Delta SkyLinks 
web site [www.delta-air.com] is accessed more than 
40,000 times a day, providing schedule, pricing, flight 
and SkyMiles account balance information. Quick and 
convenient electronic ticketing is now offered on all 
Delta Express, Delta Shuttle and Delea flights within 
ELECTRONIC TICKETING 
Percent of All Tickets by Quarter 
,~ 
r=.=:=:=:=:=:=:=:=:=.=7=-==---10======-1-5-18 
6~8 
_ 
. 
, ----------------24 
0 7 14 21 28 
Electronic ticket sales are growing rapidly and represent significant 
potential for lowering distribution costs. Electronic ticketing enhances 
customer convenience by eliminating the need for ticket confirmation 
while reducing Delta's handling costs. 
the 50 states, San Juan, Puerto Rico, the U.S. Virgin 
Islands, Bermuda, the Caribbean and Canada. 
GREATER ACCESS TO THE WORLD 
Customers want more convenient access to the world's 
most important markets. But no single airline can take 
travelers everywhere in the world. The Company's strate- 
gic alliances with ocher high-quality carriers greatly extend 
the number of destinations Delta can offer customers. 
Linking the Company's hubs with those of partners 
creates interconnected travel networks to key destina- 
tions in Europe, Asia and Latin America. In addition, 
alliances are good business. They allow the Company 
to take advantage of partners' route networks and more 
efficiently allocate Delta's aircraft to the most profitable 
markets. Through alliances, Delta also can serve key 
markets that otherwise could not be served because 
of economic or political issues. 
1 998 ANNUAL REPORT 9 
 Partner with 
oyees 
Delta will build a world-class organization through a partnership culture 
focused on performance, teamwork and winning. 
In the airline business, succe s depends on committed, 
enthu ia tic people who know how to deliver good ser- 
vice. Delta people are the best in the business. Their hard 
work and dedication were critical in achieving record 
financial re ult and significant operational improve- 
ments in fi cal 1998. Delta people are the foundation 
upon which the Company will build its future. 
BUILD THE BE T AIRLINE 
Delta will build the best airline in the world by 
attracting and retaining excellent people who share 
a commitment to winning. Delta will create a win- 
ning organization by engaging employees in a work 
environment that focuses on customers, inclusion, 
communication and performance. 
Inclusion is a key element. It is being fostered in part 
through employee forums or councils created to repre- 
sent operating units. Inclusion and participation also 
are core values for more than 370 employee Continuous 
Improvement Teams which have collectively identified 
and delivered $66.3 million in cost savings, 182 safety 
improvements and thousands of process improvements 
since the program's inception in 1995. 
10 D E L TA AIR LI NES 
The Company took on a special challenge in fiscal 
1998, providing nearly every Delta per on the oppor- 
tunity to meet face-to-face with senior management 
to discuss corporate goals. Thi sharing of information 
and ideas is essential to teamwork and has contributed 
to an atmosphere of partnership and inclusion. 
Pay-for-performance programs trengthen the link 
between employee and shareowner . Delta will be 
able to offer compensation at or near the top of the 
industry as long as the Company' productivity is at 
or near the top of the industry. Profit-sharing and 
stock option programs, which cover substantially all 
employees, are key elements of thi philosophy. 
PROFIT-SHARING AWARDS 
In Millions of Dollars 
::: :r=-:=-:::_ 
3 
:6 
:::. 
60 _______ 145 
1998 ., - - - - - - - - - - - - - - - - 180 
0 50 JOO 150 200 
Delta people earned a record profit-sharing payment of more than 
$180 million based on the Company's financial performance in fiscal 
1998, representing an average 6% of annual salary. 
 Sharing information and ideas is essential to building 
a successful partnership. 
A PARTNERSHIP CULTURE 
Employees are responding positively to this partnership 
culture. A 1998 survey of Delta personnel, conducted by 
an independent firm, showed substantial improvements 
in employee support for Delta's strategic direction and 
management. Many key measures of employee satis- 
faction showed double-digit improvement, moving 
the Company to ratings at or above average against a 
normative base of 250 other companies. 
Delta people are dedicated to delivering quality customer 
service each and every day. 
1998 ANNUAL REPORT 11 
 Partner with 
areowners 
Building on its strengths, Delta will sustain and build value for shareowners 
by accelerating earnings growth and cash returns, maximizing the balance 
sheet and minimizing fixed costs. 
By focu ing on winning with cu comers and strength- 
ening it partnership with employee , Delta will sustain 
and build value for shareowners. The Company ha 
established a clear et of prioritie designed to pur ue 
three fundamental financial objective . 
1. ACCELERATE EARNINGS 
GROWTH A D CA H RETURNS 
Accelerating earning growth and generating more cash 
is about winning and being better than the competi- 
tion. Improving the Company's revenue performance 
relative to the industry will be critical in delivering 
value to Delta's shareowners. The opportunities for 
capturing incremental revenue are significant and are 
both process- and technology-oriented. 
Maintaining Delta's unit cost advantage versus the 
industry is a major priority, equal in importance to 
revenue growth. Delta has an approximate five percent 
unit cost advantage versus the major network carriers. 
Future cost management of the Company will involve 
clear rules. Expenditures which make the customer 
travel experience better or generate additional revenue, 
will always be a priority. 
12 D E LT A A I R L I N E S 
A focu on generating more cash is inextricably linked 
with accelerating earnings growth. Increasing cash- 
generating abilities enable the ompany to invest for 
the future while continuing to reward shareowners. 
OP ERAT ING M ARGIN 
Percent 
1995 5.4 
1996 10.4 
1997 11.6 
1998 12.0 
3 6 9 12 15 
'Excltu:ks restructuring nnd other non-reC11rring charge, and the cumul,mve effect of an accounting change. 
Disciplined growth and optimization of Delta's operating margin will 
drive earnings growth. Revenue initiatives, process-based productivity 
improvements and a relentless focus on eliminating redundant processes 
will expand Delta's industry-Leading operating margin. 
OP ERATING C ASH FLOW 
In Billions of Dollars 
;::: : 
:-:::::::::::: 
l. l 
: 
l.4 
- - 2.0 
ms 
j. 
, 
-------------2 
. 
9 
0 2 3 4 
Record earnings and cash flow in fiscal 1998 allowed Delta to internally 
fund investments in aircraft and ground equipment, reduce Long-term 
debt and capital L 
eases by $183 million, and build cash and short-term 
investments ftom $1.2 billion to $ 1.6 billion. 
 Delta's Operations Control Center plays a critical role in the efficiency of the Company's daily operations. 
2. MAXIMIZE THE BALANCE SHEET 
Delta's industry-leading financial performance over the 
past several years has built a solid foundation. A strong 
balance sheet and financial flexibility are catalysts for 
the Company's $750 million common stock repurchase 
program which began in July 1998. In addition to 
holding investment-grade ratings from both major 
credit-rating agencies, Delta has financial ratios among 
the strongest in the industry. This solid financial posi- 
tion provides significant flexibility and will allow the 
Company to aggressively seek additional opportunities 
to create and return value to shareowners. 
1995 
1996 
1997 
1998 
DEBT-TO-TOTAL CAPITALIZATION 
Percent 
-----------------8 
4 
- - - - - - - - - - - -  76 
-----------73 
--------6 
1 
50 60 70 80 90 
Delta's debt-to-total capitalization ratio (including leases) of 67 % is 
within the Company's targeted 65-70% range. Delta's targeted range 
includes the prudent use of debt to lower the cost of capital while 
p reserving investment-grade ratings. 
I 9 9 8 A N N U A L R E P R T 13 
 P R TN R I T H H A R  WN E R NT I NU  D) 
The ability to successfully manage through economic downturns will 
differentiate Delta as a winning organization and will generate 
value for shareowners. 
3. MI IMIZE FI ED C T 
Becau Delta op rat s a r latively high fixed-co t bu i- 
ne in a c clical indu try, th focu on making co ts 
mor ariabl i a top priority. The ability to ucce fully 
manag through conomi downturn will diffi r ntiate 
Delta a a winning organization and gen rat value for 
hareowner . It r quire th ompany to focu on the 
i ue of fixed ver u variabl co ts today while time are 
good. ucce sful companies do not yield to the t mp- 
tacion to permanently size their operation for the peaks. 
Delta mu t be right-sized with variable components 
to react quickly to economic and market conditions. 
Delta performance through the next recession will 
be impacted by its ability to manage capacity. D lea is 
well po itioned to react to an economic contraction 
by virtue of its ignificant fleet flexibility. Lever for 
contracting growth include accelerated retirement of 
aircraft and contractual delivery deferral rights in Delta's 
long-term agreement with The Boeing Company. 
14 D EL TA A I R L I E S 
Delta's employee stock option plan is designed to align employee interests 
with those of shareowners. 
FIS AL 1998 OPERATING E X PENSE DISTRIBUTION 
Percent 
A. Salaries and Related osrs 39% 
B. Aircraft ruel 12% 
. Pa senger omm1ssions 8% 
D. Depreciation and Amortization 7% 
E. ontracted Services 6% 
F. Landing Fees and Other Rents 5% 
G. Other elling Expenses 5% 
H. Aircraft Maintenance 4% 
I. Aircraft Rent 4% 
J. Passenger ervice 4% 
K. Other 6% 
Maintaining a unit cost advantage versus the industry and making costs 
L 
ess fixed and more variable requires focusing on every Delta activity to 
determine what is important to customers and what is core to the delivery 
of Delta's product. The goal is process-based productivity with rigorous 
measurement and accountability. 
 Partner with the 
 
ommun1ty 
Partnering with employees also means partnering with the 
communities Delta serves. 
Delta believes in being a responsible, active corporate 
citizen. The Company focuses its corporate giving on 
programs that strengthen communities. Delta supports 
programs that tackle such issues as unemployment and 
poverty through training and personal development. The 
Company also focuses its resources on programs that sup- 
port disadvantaged families with young children and pro- 
grams that foster cultural understanding and diversity. 
Delta donates more than money and free air travel. 
Delta's Community Partners, a volunteer resource cen- 
ter of active and retired employees, supports efforts and 
requests from many nonprofit organizations. Major events 
The June 1998 CIGNA Sports Challenge in Atlanta involved more 
than 1,500 corporate athletes and volunteers helping to raise fonds 
for the fight against Cystic Fibrosis. Delta sponsored four teams to 
participate in nine athletic events. 
More than 300 Delta flight attendants helped build a Habitat for Humanity 
house in Riverdale, Georgia &st year. The house was financed with proceeds 
.from recycled soft drink cans collected on Delta flights by flight attendants. 
in fiscal 1998 included: AIDS Walk Atlanta, CIGNA 
Sports Challenge and March of Dimes WalkAmerica. 
Delta people have contributed more than 10,000 vol- 
unteer hours, including the construction of numerous 
Habitat for Humanity homes funded through In-Flight 
Service personnel's aluminum can recycling program. 
In fiscal 1998, the Delta Air Lines Foundation made 
the largest contribution in its history, an $890,000 grant 
to the University of Georgia to establish the Delta Prize 
for Global Understanding. This program will recognize 
individuals or groups whose efforts have promoted peace 
and cooperation among cultures and nations. The award 
will be presented annually in Atlanta, beginning in the 
spring of 1999. 
1 9 9 8 A N N U A L R E P O RT 15 
 NORTH AMERICA 
D elta's North American network of five geographically 
balanced hubs -Atlanta, Cincinnati, Dallas-Fort Worth, 
Salt Lake City and New York-Kennedy - provides broad 
market coverage with a superior position in the Southeast 
and Florida. The Company's competitive advantage in the 
Southeast is driven by its operations in the Atlanta World- 
port, the world's largest single-carrier hub, with 633 daily 
departures to 122 nonstop markets (December 1998). 
The Atlanta hub provides high-frequency service to major 
business markets, comprehensive domestic market cover- 
age, convenient access to Florida from the Midwest and 
Northeast, and access to major international markets. The 
economic and demographic forecasts for Atlanta and the 
Southeast reflect significant future growth opportunities 
for this key strategic region. 
Delta is also strengthening its competitive position in 
the Northeast and Midwest by expanding the New York- 
Kennedy gateway to Europe, increasing frequencies between 
Atlanta and key business markets (including hourly services) 
and expanding service to Florida via Delea Express. Delta's 
December 1998 schedule will offer unparalleled access from 
major Northeast and Midwest business centers to Atlanta. 
To Atlanta From: 
New York City Area 
Washington/Baltimore Area 
Chicago 
Boston 
Daily Flights 
40 
35 
18 
15 
The Company's competitive position in the Northeast 
is also enhanced by its market share-leading Delta Shuttle 
operation. The Delea Shuttle offers Northeast business 
passengers reliable and distinctive hourly shuttle service 
from New York City to Boston and to Washington, D.C. 
Delta's Western operations include its hub in Salt Lake 
City and a niche gateway to Asia via service from Portland. 
Delta will strengthen its market position in this region 
by building market and frequency coverage primarily 
from its hubs in Atlanta, Cincinnati and Sale Lake City. 
16 DELTA A I R LINES 
 
WEST 
Delta improved asset efficiency in Salt 
Lake City by reallocating aircraft from 
north-to-south, short-haul and leisure- 
oriented markets to higher-value, longer- 
haul, east-to-west traffic flows such as 
Newark, Detroit and Philadelphia. 
MIDWEST 
Delta enhanced its Midwest market 
position by inaugurating hourly service 
from Chicago to Atlanta and adding 
new Delta E 
xpress service to Florida. 
 
Delta strengthened its position in the North- 
east by adding domestic and international 
service from New York-Kennedy, the leading 
transatlantic gateway, and adding frequen- 
cies in key business markets. 
SOUTHEAST 
Delta continued to grow the Atlanta Worldport 
by increasing service to numerous domestic 
markets and adding 10 new international des- 
tinations (including Lima, Peru subsequent to 
fiscal 1998), solidifying its position as the largest 
single-carrier hub in the world. E 
xpansion of 
Delta E 
xpress continues to strengthen Delta's 
market leadership in Florida. 
  
18 DELTA A IR LINES 
Delta's leadership position across the North 
Atlantic and superior market position in New 
York-Kennedy are supplemented by a com- 
prehensive alliance strategy with Swissair, 
Austrian and Sabena and a new code-sharing 
agreement with Air France. 
LATIN AMERICA 
Building on the hub strength of the Atlanta 
Worldport, Delta launched direct service into 
six new Latin American countries. Delta also 
expanded its Aeromexico and Transbrasil 
code-sharing relationships and established 
new marketing agreements with Aeroperu 
and Aeropostal (Venezuela). 
Delta initiated daily nonstop service from Atlanta 
to Tokyo, announced new service from P 
ortland 
to Fukuoka and Osaka, and received authority to 
serve Honolulu to Tokyo (new service subject to 
slot availability). As a result of a new bilateral 
agreement, Delta announced expanded code- 
sharing services with Korean Air including access 
to beyond markets in Asia through Seoul. 
GLOBAL REACH 
I n fiscal 1998, Delta continued to build on its trans- 
atlantic leadership position and extended its reach to Asia 
and rapidly-expanding Latin American markets. 
In the North Atlantic, the second-largest aviation market 
in the world, Delta began service from New York-Kennedy 
to Barcelona, Stockholm, Warsaw and Stuttgart. Delta also 
initiated service from Atlanta to Zurich and Hamburg. 
Over the past several years the Company has taken aggres- 
sive steps to rationalize transatlantic flying and grow 
market share. Once a money-losing operation, Delta's 
transatlantic entity is now an important contributor to 
overall profitability. 
In Latin America, Delta built upon the Company's 
successful service to Brazil and Mexico by inaugurating 
service from Atlanta to six countries: Costa Rica, El 
Salvador, Guatemala, Panama, Peru (subsequent to fiscal 
1998) and Venezuela. Based on its superior geographic 
location and connecting capabilities, the Atlanta Worldport 
is a natural gateway to Central and South America. Delta's 
Atlanta Worldport is well positioned to capture a signifi- 
cant amount of the rapidly growing traffic to Central and 
South America. Approximately 65 percent of all U.S.-to- 
Latin America traffic can be accessed via Atlanta, and 50 
percent of the total market is best accessed via Atlanta. 
In Asia/Pacific, Delta launched nonstop service from 
Atlanta to Tokyo. New nonstop access to one of the world's 
most important markets and the hub-gathering strength of 
the Atlanta Worldport will allow Delta to build a leader- 
ship position between the southeastern U.S. and Asia. 
With the addition of service from Portland to Fukuoka 
(effective October 29, 1998) and Osaka (effective June 
1999), Delta will serve more Japanese cities nonstop from 
the mainland U.S. than any other carrier. 
 DELTA EXPRESS 
Delea E pre ch ompany su e sful low-fare opera- 
ignificanr economic and trat gi value 
to Delea. Delea Expr enables the ompany to capture 
and grow it hare of Florida lei ur traffic from high- 
d mand area in both the Northeast and Midwe t. Delea 
E pre a commodar low r-yielding l i ur pa sengers at 
a ignifi andy lower co t on non top flight chat overfly 
Delea danra and incinnari hub . Improved personnel 
and aircraft efficiencie allow Delea Expre s to profitably 
expand the ompany' hare of Florida traffic while increas- 
ing the capacity of its hub to carry higher-yielding traffic. 
During fiscal year 1998, Delea Expre s added four 
aircraft to its fleer, increa ed ervice in exi ring marker , 
20 D E L T A A I R L I N E S 
and began ervice to Ral igh-Durham, I lip-Long Island, 
l veland and Kan a 1 ry. 
D lea Expres will continu to expand operation in fis- 
cal 1999 by increasing its dedicated fleet of B-737-200 jet 
aircraft from 29 co 40 and by beginning service co Orlando 
from four citie in New York (Albany, Buffalo, Rochester 
and yracu e). In resp on e to the growing demand for 
nonstop ervice to the ouch Florida region, Delta Expre s 
also ha announced plan to develop Fort Lauderdale as 
a second focu ci ry. Service will be expanded to Fort 
Lauderdale from Washington, D. .-Dulles (October 1), 
Newark (December 1) and Hartford (December 1). 
DEL 
TA EXPRr. ITIES 
EFFECTIVE DI:CEMBER 1, 1998: 
Albany, NY 
Boston, MA 
Buffalo, NY 
Cleveland, O H 
Columbus, O H 
Fort Lauderdale, FL* 
Fort Myers, FL 
H artford, CT 
Indianapolis, IN 
Islip, NY 
Kansas City, MO 
Louisville, KY 
Nashville, TN 
Newark, NJ 
Orlando, FL* 
Providence, RI 
Raleigh-Durham, NC 
Rochester, NY 
Syracuse, NY 
Tampa, FL 
Washington, D . C.-Dulles 
West Palm Beach, FL 
* Focus city 
 AIRCRAFT FLEET 
At the heart of the Company's operations is Delta's aircraft 
fleet. To maintain a young and technologically advanced 
fleet, Delta has entered into a long-term aircraft purchase 
agreement with The Boeing Company (Boeing). The 
agreement covers firm orders, options and rolling options 
for certain aircraft through calendar year 2017, and sup- 
ports the Company's plan for disciplined growth, aircraft 
rationalization and fleet replacement. 
The agreement with Boeing provides Delta with long- 
term price controls, risk sharing and the flexibility to adjust 
scheduled aircraft deliveries or substitute between aircraft 
models and aircraft types, subject to certain conditions. 
The majority of the aircraft under firm order will be 
used to replace older aircraft. Delta's long-term plan is 
to reduce aircraft family types from six to three. A move 
to a more standardized fleet is expected to improve relia- 
bility and result in long-term cost savings. As previously 
announced, the Company plans to retire its remaining 
L-1011 aircraft by August 2001, replaced primarily by 
B-767 aircraft. Delta also has announced a three-year 
acceleration of the planned retirement of the B-727 air- 
craft fleet which it now plans to retire by the end of fis- 
cal 2005. The B-727 aircraft will be replaced primarily 
by new generation B-737 aircraft. 
Delta accepted delivery of 15 new aircraft and acquired 
10 aircraft from other carriers during fiscal 1998, com- 
posed of two B-727-200 aircraft, six B-737-300 aircraft, 
four B-757-200 aircraft, 12 B-767-300ER aircraft and 
one MD-11 aircraft. In addition, Delta purchased four 
727-200 aircraft that it previously leased. The Company 
expects to take delivery of seven aircraft from other carriers 
in fiscal 1999, five of which have been delivered. Delta 
retired nine L-1011 aircraft from the fleet in fiscal 1998. 
AIRCRAFT FLEET AT JUNE 30 , 1998 
Average Leased 
Ai rcraft Type Age Owned Capital Operating Total 
B-727-200 21.2 121 10 131 
B-737-200 13.6 1 45 8 54 
B-737-300 11.6 3 16 19 
B-757-200 9. 1 54 41 95 
B-767-200 15. 1 15 15 
B-767-300 9. 1 2 24 26 
B-767-300ER 4.2 31 8 39 
L-1011-1 19.8 18 18 
L-1011-250 15.7 6 6 
L-1011-500 17.3 15 15 
MD-11 4.4 8 7 15 
MD-88 8.0 63 57 120 
MD-90 2.6 16 16 
Tocal 12.3 350 48 171 569 
AIRCRAFT DELIVERY SCHEDULES AT AUGUST 14 , 1998 
Delivery in Year Ending June 30: 
After 
Ai rcraft on Firm Order 1999 2000 200 1 2002 2002 Total 
B-737-600/700/800 7 12 5 9 54 87 
B-757-200 5 7 12 
B-767-300/300ER 14 14 
B-767-400 2 19 21 
B-777-200 2 10 2 14 
Total 28 31 26 9 54 148 
Delivery in Year Ending June 30: 
After Rolling 
Ai rcraft on O ption* 1999 2000 200 1 2002 2002 Total Options 
B-73 7-600/700/800 - 5 12 7 36 60 275 
B-757-200 4 3 8 5 20 85 
B-767-300/300ER 4 2 4 11 19 
B-767-400 12 12 24 25 
B-777-200 5 14 20 30 
Total 10 20 34 71 135 434 
* Aircraft options have scheduled delivery slots, while roLLing options replace options 
and are assigned delivery slots as options expire or are exercised. 
I 9 9 8 A N N U A L R E P O RT 21 
 - 
,,-~ 
,~.._'.\ 
... 
oY 
-- .. 
~~ 
,, 
B AR F D I R T R 
EDW1N L. ARTZT hairman of the Executive ,ommittee of the Board of Directors, 
The Procter & amble ompany; Retired hairnzan of the Board and hief Executive 
Office,; The Procter & amble ompany, incinnati, Ohio 
HENRY A. BIEDENHARN, III Retired hairman of the Board, President and hie/ Executive )jficer, 
Ouachita Coca- o/,a Bottling ompany, Inc., Monroe, Louisiana 
JAME L. BROADHEAD hairman of the Board and Chief Executive Officer, FPL 
Group, Inc.; hairma11 of the Board and hie/ Executive Officer, Florida Power & Light 
ompany, Juno Beach, Florida 
EDWARD H. BUDD Retired hairman of the Board and hie/Executive Office,; 
The Trave/,ers orporation, Hartford, onnecticut 
R. EUGENE ARTLEDGE Former Chairman of the Board, Savannah Foods & 
Industries, Inc., Savannah, Georgia; Retired Chairman of the Board and Chief Executive 
Officer, Union Camp Corporation, ~yne, New Jersey 
GERALD GRINSTEIN Non-Executive Chairman of the Board, Delta Air Lines, Inc.; 
Retired Chairman, Burlington Northern Santa Fe Corporation; Retired Chairman and 
Chief Executive Officer, Burlington Northern Inc., Fort Worth, Texas; former Chief 
Executive Officer, Western Air Lines, Inc. 
JESSE HILL, JR. Retired Chairman of the Board, Atwnta Life Insurance Company, Atwnta, Georgia 
Mr. HiLL wiLL retire from the Board of Directors on October 22, 1998. He has been a director of Delta since 1975. 
LEO F. MULLIN President and Chief Executive Officer, Delta Air lines, Inc.; former 
Vice Chairman, Unicom Corporation and Commonwealth Edison; former President and 
Chief Operating Officer, First Chicago, Chicago, Illinois 
ANDREW J. YOUNG Co-Chairman and Senior Partner, Goodworks International, Inc., Atlanta, Georgia; 
Chairman of the Southern Africa Enterprise Development Fund; former Mayor of Atlanta, Georgia; former US. 
Ambassador to the United Nations; former member of the US. House of Representatives 
22 D E L T A A I R L I N E S 
 BOARD COMM I TTEES 
AUDIT 
James L. Broadhead, Chairman 
Henry A. Biedenharn, III 
Mary Johnston Evans 
Jesse Hill, Jr. 
BENEFIT FUNDS 
INVESTMENT 
Jesse HiLL, Jr., Chairman 
Henry A. Biedenharn, III 
James L. Broadhead 
Andrew J. Young 
CORPORATE GOVERNAN E 
Mary Johnston Evans, Chairman 
James L. Broadhead 
Gerald Grinstein 
Andrew j. Young 
CORPORATE STRATEGY 
Edward H. Budd, Chairman 
Edwin L. Artzt 
R. Eugene Cartledge 
Gerald Grinstein 
EXECUTIVE 
Mary Johnston Evans, Chairman 
Edwin L. Artzt 
James L. Broadhead 
Edward H. Budd 
R. Eugene Cartledge 
Jesse Hill, Jr. 
FINANCE 
Edwin L. Artzt, Chairman 
Edward H. Budd 
R. Eugene Cartledge 
Gerald Grinstein 
PERSONNEL & 
COMPENSATION 
R. Eugene Cartledge, Chairman 
Edward H. Budd 
Mary Johnston Evans 
Gerald Grinstein 
R E P RESENTAT I VE OF A I R L I NE P I LOTS ASSOC I A TI ON, I NTE R N A T I ONA L 
Captain Mark D. Halsor -Associate 
non-voting member of 
the Board of Directors 
DELTA B OA R D COUNC IL R E PR ESENTAT I VES 
AIRPORT CUSTOMER 
SERVICE AND CARGO 
C. Bradley Bray 
FLIGHT ATTENDANTS 
Cathy Cleveland Cone 
TECHNICAL OPERATION 
john C. James 
SUPERVISORY/ 
ADMINISTRATIVE 
Duff j. O'DeLL 
Employee representatives to the Board of Directors 
OFF I CERS 
LEO F. MULLIN 
President and Chief Executive Officer 
MAURICE W WORTH 
Chief Operating Officer 
HARRY C. ALGER 
Executive Vice President - 
Operations 
VICKI B. ESCARRA 
Executive Vice President - 
Customer Service 
WARREN C. JENSON 
Executive Vice President and 
Chief Financial Officer 
FREDERICK W REID 
Executive Vice President and 
Chief Marketing Officer 
VIN CENT F. CAMINITI 
Senior Vice President - 
Sales and International 
WE. DOLL 
Senior Vice President - Cargo 
ROBERTS. HARKEY 
Senior Vice President - 
General Counsel and Secretary 
PAUL G. MATSEN 
Senior Vice President - ALiiance 
Strategy and Development 
JENNY R. POOLE 
Senior Vice President - 
In-Flight Service 
THOMAS J. SLOCUM 
Senior Vice President - 
Corporate Communications 
RAYVALEIKA 
Senior Vice President - 
Technical Operations 
D. SCOTT YOHE 
Senior Vice President - 
Government Affairs 
MALCOLM B. ARMSTRONG 
Vice President - Corporate Safety 
and Compliance 
BRENDA A. BARNES 
Vice President - Pricing and 
Revenue Management 
W E. (SKIP) BARNETTE 
Vice President - Atlanta Worldport 
HAROLD L. BEVIS 
Vice President - Public Affairs 
OPERATIONAL 
SUPPORT/CLERICAL 
Joseph W Gooch 
RESERVATION SALES AND 
CITY TICKET OFFI ES 
Wi/Liam M. Morey 
JOHN W BOATRIGHT 
Vice President - 
Properties and Facilities 
W MARTIN BRAHAM 
Vice President - Delta Staffing 
Services Business Unit Development 
FREDERICK WP. BUTTRELL 
Vice President - Operation Planning 
Control and Reliability 
ANTHONY N. HARAF 
Vice President - 
Power Plant Maintenance 
RICHARD E. COLBY 
Vice President - Flight Operations 
MARKA. P. DRUSCH 
Vice President - 
Marketing Development 
STEPHAN J. EGLI 
Vice President - Atlantic/Pacific 
Business Unit 
MICHAEL . ELLENBURG 
Vice President - Aircraft 
Maintenance and Engineering 
FIELD/CARGO SALES 
Nancie W Parker 
TERRY M. ERSKINE 
Vice President - Personnel Relations 
LEE A. MACENCZAK 
Vice President - Reservation Sales 
and Distribution Planning 
LEON A. PIPER 
Vice President - Personnel Benefits 
UDO RIEDER 
Vice President - Purchasing 
EDWARD H. WEST 
Vice President - Financial 
Planning and Analysis 
MICHAEL M. YOUNG 
Vice President - Community Affairs 
DEAN C. ARVIDSON 
Assistant Secretary 
SUSAN T. HUDSON 
Assistant Secretary 
LE LIE P. KLEMPERER 
Assistant Secretary 
1 9 9 8 A N N U A L R E P O R T 23 
 FINANCIAL REVIEW 
MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 
CONSOLIDATED BALANC E SHEETS 
CONSOLIDATED STATEM ENTS OF OPERATIONS 
CONSOLIDATED S TATEMENTS OF CASH FLOWS 
CONSOLIDATED STATEMENTS OF SHAREOWNERS' EQUITY 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS 
REPORT OF MANAGEMENT 
SHAREOWNER INFORMATION 
DELTA AIR LINES AT-A-GLANCE 
24 D E l. T A A I R l. I N E S 
PAGE 25 
PAGE 34 
PAGE 36 
PAGE 37 
PAGE 38 
PAGE 39 
PAGE 53 
PAGE 53 
PAGE 56 
PAGE 57 
 MANAGEMENT'S DISCUSSION AND ANALYSIS 
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 
DELTA AIR LINES , INC . 
RESULTS OF OPERATIONS 
SUMMARY OF RESULTS 
For fiscal 1998, Delta recorded operating income of $1.7 bil- 
lion and net income of$1.0 billion ($13.28 basic and $12.68 
diluted income per common share). These results represent 
the strongest financial performance ever reported by Delta for 
a fiscal year. In fiscal 1997, Delta recorded operating income 
of $1.5 billion and net income of $854 million ($11.39 basic 
and $11.03 diluted income per common share). 
Financial Results Summary 
(In Milliom, Except Share Amounts) 
Operating Revenues 
Operating Expenses 
Operating Income 
Ocher Expense, Nee 
Income Before Income Taxes 
Income Taxes Provided 
Nee Income 
Preferred Srock Dividends 
Nee Income Available co 
Common Shareowners 
Income per common share: 
Basic 
Diluted 
Number of Shares Used 
co Compute Income 
Per Common Share: 
Basic 
Diluted 
1998 
$14,138 
12,445 
1,693 
45 
1,648 
647 
1,001 
11 
$ 990 
$ 13.28 
$ 12.68 
1997 
$13,594 
12,063 
1,531 
116 
1,415 
561 
854 
9 
$ 845 
$ 11.39 
$ 11.03 
74,567,059 74,233,606 
78,630,519 76,964,892 
Change 
4% 
3 
11 
(61) 
16 
15 
17 
22 
17% 
17% 
15% 
Fiscal 1997 results include pretax restructuring and other 
non-recurring charges of $52 million ($32 million after-tax 
or $0.43 basic and $0.42 diluted income per common share) 
related to the realignment of the Company's transatlantic 
and European operations. 
FISCAL 1998 COMPARED WITH FISCAL 1997 
OPERATING REVENUES 
Operating Revenue Detail 
(In Milliom) 1998 1997 
Passenger $12,976 $12,505 
Cargo 582 554 
Ocher, Nee 580 535 
Total $14,138 $13,594 
Change 
4% 
5 
8 
4% 
Operating revenues for fiscal 1998 were $14.1 billion, 
up 4% from $13.6 billion in fiscal 1997. Passenger revenue 
increased 4%, which reflects a 3% increase in revenue pas- 
senger miles on capacity growth of2%. The passenger mile 
yield was 12.83<t, virtually unchanged from fiscal 1997. 
During fiscal 1998, Delta benefited from continued favorable 
economic conditions, increased demand for air travel and the 
strategic reallocation of certain aircraft. 
Domestic passenger revenue increased 4%, to $10.7 billion, 
driven by a 3% increase in domestic revenue passenger miles 
on a 2% increase in domestic capacity. The increase in domes- 
tic revenue passenger miles is primarily due to favorable 
economic conditions and improved asset utilization. 
Domestic passenger mile yield increased 1 % due to a domestic 
fare increase implemented during the September 1997 q uar- 
ter, largely offset by the full-year impact of the U.S. trans- 
portation excise tax and increased low-fare competition. 
Consistent with the Company's strategy to expand its 
global reach, international passenger revenue increased 3%, 
to $2.3 billion, reflecting a 6% increase in international 
revenue passenger miles on a 5% increase in international 
capacity. The increase in international revenue passenger 
miles is primarily due to the addition of new routes, improved 
asset utilization, and continued strong demand in the 
Atlantic market, as well as the Company's recent expansion 
into Latin America. The international passenger mile yield 
decreased 3% year over year, mainly due to overall capacity 
growth in the Atlantic market. 
Cargo revenues increased 5% to $582 million, reflect- 
ing a 14% increase in cargo ton miles and an 8% decrease 
in cargo ton mile yield. All other revenues increased 8% to 
$580 million, mainly due to higher administrative service 
charge revenues. 
Revenue-Related Statistics 
1998 1997 Change 
Revenue Passengers 
Enplaned (Thousands) 104,148 101,147 3% 
Revenue Passenger 
Miles (Millions) 101,136 97,758 3% 
Passenger Load Factor 72.2% 7 1.4% 0.8 pcs. 
Passenger Mile Yield 12.83 12.79 
Cargo Ton Miles (Milliom) 1,745 1,532 14% 
Cargo Ton Mile Yield 33.35 36.14 (8)% 
Operating Revenue 
Per Available Seat Mile 10.09 9.94 2% 
I 9 9 8 A N N U A L R E P O R T 25 
 MANAGEMENT' DI CU ION AND ANALYSI 
OF FINAN IAL CONDITION AND RE ULT OF OPERATION continued 
DELTA AIR LINE , IN 
OPERATING Ex!>ENSES 
Operating expenses in fiscal 1998 totaled $12.4 billion, 
up 3% from $12.1 billion in fiscal 1997. Operating cost 
per available seat mile increased 1 % to 8.88. 
Operating Expense Detail 
(In Millions) 1998 1997 Change 
alaries and Related Costs $ 4,850 $ 4,534 7% 
Aircraft Fuel 1,507 1,722 (12) 
Passenger Commissions 980 1,01 7 (4) 
Depreciation and Amortization 861 710 21 
Contracted Services 694 630 10 
Other Selling Expenses 681 677 
Landing Fees and Other Rents 649 649 
Aircraft Rent 552 547 
Aircraft Maintenance Materials 
and Outside Repairs 495 434 14 
Passenger Service 450 389 16 
Restructuring and 
Other on-recurring Charges 52 
Other 726 702 3 
Total $12,445 $12,063 3% 
Salaries and related costs increased 7% due to an 8% 
increase in full-time equivalent employees, primarily in cus- 
tomer service areas, and compensation and benefit enhance- 
ments for non-contract domestic employees, which became 
effective July 1, 1997. Aircraft fuel expense decreased 12% 
as the average fuel price per gallon declined 15% to 56.54. 
Passenger commissions expense decreased 4% due to the 
implementation of a lower commission race structure in the 
September 1997 quarter and increased utilization of lower 
cost distribution channels, partially offset by higher total 
commissions resulting from increased passenger revenue. 
Depreciation and amortization expense increased 21 % due 
to the acquisition of additional aircraft and ground equip- 
ment, as well as increased investment in information systems. 
Contracted services expense rose 10% due to higher infor- 
mation technology coses and increased airport contract 
expenses associated with customer service initiatives and 
higher passenger volume. Aircraft maintenance materials 
and outside repairs expense increased 14% largely due to 
increased scheduled maintenance visits. Passenger service 
expense increased 16% due to onboard service enhance- 
ments and increased passenger traffic. 
26 D E L T A A I R L I N E S 
Operating Statistics 
1998 1997 Change 
Available Seat Miles (Millions) 140,149 136,821 2% 
Operating Margin 12.0% 11.3% 0.7 pts. 
Fuel Gallons onsumed (Millions) 2,664 2,599 3% 
Average Fuel Price Per Gallon 56.54 66.23 (15)% 
Breakeven Passenger Load Factor 62.7% 62.7% 
Operating ost Per Available 
Seat Mile 8.88 8.82 1% 
OTHER INCOME (Ex.PENSE) 
Ocher expense for fiscal 1998 decreased $71 million to 
$45 million, primarily due to lower interest expense result- 
ing from lower average levels of debt outstanding and 
higher interest income resulting from higher cash balances. 
In addition, fiscal 1997 other expense included a $20 mil- 
lion payment to settle certain class action antitrust lawsuits 
filed by travel agents. 
FISCAL 1997 COMPARED WlTH FISCAL 1996 
For fiscal 1997, Delta recorded operating income of$ 1. 5 bil- 
lion and net income of $854 million ($11.39 basic and 
$11.03 diluted income per common share). In fiscal 1996, 
Delea recorded operating income of $463 million and net 
income of $156 million ($1.43 basic and diluted income 
per common share). 
As discussed previously, fiscal 1997 results include 
pretax restructuring and other non-recurring charges of 
$52 million. Fiscal 1996 results include pretax restructur- 
ing and other non-recurring charges totaling $829 million 
($506 million after-tax or $9.77 per common share) related 
to the write-down of Delta's L-1011 fleet and certain cost 
reduction initiatives. 
OPERATING REVENUES 
Operating revenues for fiscal 1997 were $13 .6 billion, up 9% 
from $12.5 billion in fiscal 1996. Passenger revenue increased 
8%, the result of 10% growth in revenue passenger miles 
partially offset by a 2% decline in the passenger mile yield. 
 Domestic passenger revenue increased 9%, to $10.3 bil- 
lion, reflecting a 13% increase in domestic revenue passenger 
miles on a 6% increase in domestic capacity, and a 3% decline 
in the domestic passenger mile yield. Domestic traffic growth 
was primarily due to the Company's realignment of domes- 
tic routes which increased Delta's operations at its Atlanta 
and Cincinnati hubs; reduced operations by a competitor; 
and favorable economic conditions. The decrease in the 
domestic passenger mile yield was due to the use of more 
competitive pricing strategies and the reimposition of the 
U.S. transportation excise tax on March 7, 1997. 
International passenger revenue rose 1 %, to $2.2 billion, 
due to a 3% increase in international revenue passenger miles 
which was largely offset by a 2% decline in the international 
passenger mile yield. The increase in international revenue 
passenger miles was primarily due to improved asset utiliza- 
tion and favorable economic conditions. The decrease in the 
international passenger mile yield was due to the Company's 
use of more competitive pricing strategies. 
Cargo revenues increased 6% to $554 million, reflect- 
ing a 12% increase in cargo ton miles and a 5% decline 
in cargo ton mile yield. Other revenues were up 68% to 
$535 million, mainly due to increased revenues from 
expanded joint marketing programs and improved results 
from code-sharing arrangements. 
OPERATING EXPENSES 
Operating expenses in fiscal 1997 totaled $12.1 billion, up 
1 % from $12.0 billion in fiscal 1996. Operating capacity 
increased 5% to 136.8 billion available seat miles, and oper- 
ating cost per available seat mile decreased 4% to 8.82<t. 
Excluding restructuring and other non-recurring charges, 
operating expenses were up 8%, and operating cost per 
available seat mile increased 3%. This increase was pri- 
marily due to higher salaries and related costs, aircraft fuel 
expense and certain traffic-related costs. 
OTHER INCOME (EXPENSE) 
Other expense for fiscal 1997 decreased $71 million, to 
$116 million, primarily due to lower interest expense and 
higher equity income from associated companies. Other 
expense for fiscal 1997 included Delta's $20 million pay- 
ment to settle certain class action antitrust lawsuits filed by 
travel agents. 
LIQUIDilY AND CAPITAL RESOURCES 
FISCAL YEAR 1998 
During fiscal 1998, strong operating results enabled the 
Company to continue to strengthen its financial position. 
Cash and cash equivalents and short-term investments totaled 
$1.6 billion at June 30, 1998, compared to $1.2 billion at 
June 30, 1997. The principal sources of funds during fiscal 
1998 were $2.9 billion of cash from operations, $402 million 
(including an income tax benefit of $84 million related to 
the exercise of stock options) from the issuance of Common 
Stock, primarily under the Company's broad-based employee 
stock option plans, and $125 million from the issuance of 
long-term obligations. 
During fiscal 1998, Delta invested $1.8 billion in flight 
equipment and $531 million in ground property and equip- 
ment. The Company also made payments of $307 million on 
long-term debt and capital lease obligations; paid $354 mil- 
lion to repurchase Common Stock; and paid cash dividends 
of $28 million on its Series B ESOP Convertible Preferred 
Stock, and $15 million on its Common Stock. The Company 
may repurchase additional long-term debt and Common 
Stock from time to time. 
As ofJune 30, 1998 and 1997, the Company had nega- 
tive working capital of $1.2 billion. A negative working capi- 
tal position is normal for Delta and does not indicate a lack 
ofliquidity. The Company expects to meet its current and 
long-term obligations as they become due through available 
cash, short-term investments and internally generated funds, 
supplemented as necessary by debt financing and proceeds 
from sale and leaseback transactions. At August 14, 1998, 
the Company had $1.25 billion of credit available under its 
1997 Bank Credit Agreement. See Note 6 of Notes to 
Consolidated Financial Statements. 
I 9 9 8 A N N U A L R E P O R T 27 
 MANA 
OF Fr 
EMENT' DI U ION AND ANALYSI 
AN IAL C NDITION AND RE ULT OF OPERATION continued 
DELTA AIR LINE , IN 
Long-term debt and capital lease obligations, including 
current maturities, totaled $1.9 billion at June 30, 1998, com- 
pared to $2.1 billion at June 30, 1997. hareowners' equity 
was 4.0 billion at June 30, 1998, compared to $3.0 billion 
at June 30, 1997. The Company's debt-to-equity position, 
including current maturities, was 32% debt and 68% equity 
at June 30, 1998, compared to 41 % debt and 59% equity at 
June 30, 1997. 
At August 14, 1998, there was outstanding $290 million 
principal amount of the Delta Family-Care Savings Plan's 
Series C Guaranteed Serial ESOP Notes (Series C ESOP 
Notes), which are guaranteed by Delta. Delta is required to 
purchase the Series C ESOP Notes in certain circumstances. 
See ote 6 of Notes to Consolidated Financial Statements. 
FISCAL YEAR 1997 
During fiscal 1997, the principal source of funds was 
$2.0 billion of cash from operations. Delta invested 
$1.6 billion in flight equipment and $350 million in 
ground property and equipment. The Company also 
made payments of $196 million on long-term debt and 
capital lease obligations; paid $379 million to repurchase 
Common Stock; and paid cash dividends of $29 million 
on its Series B ESOP Convertible Preferred Stock and 
$15 million on its Common Stock. 
FISCAL YEAR 1996 
In fiscal 1996, the principal source of funds was $1.4 billion 
of cash from operations. During fiscal 1996, Delea invested 
$639 million in flight equipment, and $297 million in ground 
property and equipment. The Company made payments of 
$440 million on long-term debt and capital lease obligations; 
paid cash dividends of $80 million on its Series C Convertible 
Preferred Stock, $30 million on its Series B ESOP Convertible 
Preferred Stock and $10 million on its Common Stock; and 
paid $66 million to repurchase Common Stock. 
28 D E L T A A I R L I N E S 
COMMITMENTS 
Future expenditures for aircraft, engines and engine hush- 
kits on firm order as of August 14, 1998, are estimated co be 
$6.9 billion. The Company has also authorized fiscal 1999 
capital expenditures of approximately $550 million for 
improvement of airport and office facilities, ground equip- 
ment and other assets. See Notes 7 and 8 of Notes co Consoli- 
dated Financial tacements for additional information on 
the Company's lease obligations and commitments. 
YEAR 2000 I SUE 
Background 
Many computer systems in use today were designed and 
developed using two digits, rather than four, co specify the 
year. As a result, such systems will recognize the year 2000 
as "00." This could cause many computer applications to 
fail completely or co create erroneous results unless correc- 
tive measures are taken. 
Delta's Year 2000 Program 
The Company's flight operations, flight support units and 
other business support units depend on internal and exter- 
nal computer systems and equipment chat will be affected 
by the Year 2000 issue. Accordingly, achieving Year 2000 
readiness is a cop priority of the Company. Delea has imple- 
mented a Year 2000 program for its internal systems and 
equipment which has four phases: (1) identification; 
(2) assessment (including prioritization); (3) remediation 
(including modification, upgrading and replacement); and 
(4) testing. The Company is also reviewing the Year 2000 
readiness of third parties who provide goods or services 
which are essential co Delta's operations. In addition, Delea 
is revising its existing business interruption contingency 
plans to address issues specific to the Year 2000 problem. 
The Company's senior managef!lent and the Board of 
Directors receive regular updates on the status of the 
Company's Year 2000 program. 
 Safety-of Flight Systems 
The Company has completed its review of the impact of 
Year 2000 issues on its aircraft fleet and onboard flight sup- 
port systems and has determined chat there are no safety-of- 
flighc issues with such equipment or systems. The Company 
has completed the assessment phase for its onboard flight 
management systems, which maximize operating efficiency 
but are not essential to the safe operation of flights, and 
expects to complete the remediation and testing phases for 
these systems by June 1999. 
The Company also uses ground-based, safety-related 
computer systems and equipment which are vital to the 
maintenance of aircraft and the control of flight opera- 
tions. The identification and assessment phases are com- 
plete with respect to such systems and equipment and the 
Company expects to complete the remediation and testing 
phases by June 1999. 
Critical Internal Business Systems 
The Company's critical internal business systems and equip- 
ment include computer hardware, software and related 
equipment which are essential for customer reservations, 
ticketing, flight scheduling and seat inventory management; 
airport customer services; finance systems, such as revenue 
management, revenue accounting and payroll; and other 
functions, such as internal voice and data communications, 
aircraft ground handling, baggage handling, facility man- 
agement and security. 
The identification and assessment phases for all of the 
Company's critical internal business systems and equipment 
are complete. The remediation phase is complete for Delta's 
internal customer reservations, ticketing, flight scheduling 
and seat inventory management systems and the Company 
expects to complete the testing phase for these systems by 
June 1999. These are the internal business systems which 
are the most critical for Delta to continue its operations 
without interruption. The Company expects to complete 
the remediation and testing phases for all other critical inter- 
nal business systems and equipment by December 1998 and 
June 1999, respectively, except for customer service hard- 
ware installed at the Company's airport facilities, which will 
be replaced with upgraded, Year 2000-compliant hardware. 
The Company will begin installing chis new hardware in 
September 1998 and expects to complete all installations 
by the end of the December 1999 quarter. 
Interfaces with Third Parties 
The Company is reviewing, and has initiated formal commu- 
nications with, third parties which provide goods or services 
which are essential to Delta's operations in order to: (1) deter- 
mine the extent to which the Company is vulnerable to 
any failure by such material third parties to remediate their 
respective Year 2000 problems; and (2) resolve such prob- 
lems to the extent practicable. These entities include the 
suppliers of infrastructure critical to the airline industry, 
such as the air traffic control and related systems of the U.S. 
Federal Aviation Administration and international aviation 
authorities, the U.S. Department ofTransportation and 
local airport authorities. Ocher critical third parties on 
which Delta relies include airlines and the suppliers of air- 
craft fuel, utilities, external computer reservations services, 
and communication services. As part of this review, the 
Company is actively involved in airline industry Year 2000 
review efforts led by the Air Transport Association and the 
Internacional Air Transport Association (IATA). 
Estimated Year 2000 Costs 
The Company estimates that the total cost of achieving 
Year 2000 readiness for its internal systems and equipment 
is approximately $160 million to $175 million, of which 
$40 million has been recognized as expense in the Com- 
pany's Consolidated Statements of Operations through 
June 30, 1998. The Company believes a majority of the 
estimated total Year 2000 compliance cost will be funded 
by reallocating existing resources rather than incurring 
incremental costs. 
1 9 9 8 A N N U A L R E P O R T 29 
 MANAGEMENT' DI U ION AND ANALY IS 
0 F F I NAN I AL C O N D IT I O N AN D RE ULT O F O P E RAT I O N continued 
DELTA AIR LINE , IN 
Contingency Planning 
The Company is revising its existing business interruption 
contingency plans to address internal and external issues 
specific to the Year 2000 problem, to the extent practicable. 
uch revisions are expected to be completed by July 1999. 
These plans, which are intended to enable the Company 
to continue to operate to the extent that it can do so safely, 
include performing certain processes manually; repairing 
or obtaining replacement systems; changing suppliers; and 
reducing or suspending operations. The Company believes, 
however, that due to the widespread nature of potential Year 
2000 issues, the contingency planning process is an ongoing 
one which will require further modifications as the Company 
obtains additional information regarding ( 1) the Company's 
internal systems and equipment during the remediation and 
testing phases of its Year 2000 program; and (2) the status 
of third party Year 2000 readiness. 
Possible Consequences of Year 2000 Problems 
Delta believes that completed and planned modifications 
and conversions of its internal systems and equipment will 
allow it to be Year 2000 compliant in a timely manner. There 
can be no assurance, however, that the Company's internal 
systems or equipment or those of third parties on which Delta 
relies will be Year 2000 compliant in a timely manner or that 
the Company's or third parties' contingency plans will miti- 
gate the effects of any noncompliance. The failure of the 
systems or equipment of Delta or third parties (which Delta 
believes is the most reasonably likely worst case scenario) 
could result in the reduction or suspension of the Company's 
operations and could have a material adverse effect on the 
Company's business or consolidated financial statements. 
Forward-Looking Statements 
The preceding "Year 2000 Issue" discussion contains various 
forward-looking statements which represent the Company's 
beliefs or expectations regarding future events. When used in 
the "Year 2000 Issue" discussion, the words "believes," "expects," 
"estimates" and similar expressions are intended to identify 
forward-looking statements. Forward-looking statements 
30 D E L T A A I R L I N E S 
include, without limitation, the ompany's expectations as 
to when it will complete the remediation and testing phases 
of its Year 2000 program as well as its Year 2000 contingency 
plans; its estimated cost of achieving Year 2000 readiness; 
and the Company's belief that its internal systems and equip- 
ment will be Year 2000 compliant in a timely manner. All 
forward-looking statements involve a number of risks and 
uncertainties that could cause the actual results to differ mate- 
rially from the projected results. Factors that may cause these 
differences include, but are not limited to, the availability 
of qualified personnel and other information technology 
resources; the ability to identify and remediate all date sensi- 
tive lines of computer code or to replace embedded computer 
chips in affected systems or equipment; and the actions of 
governmental agencies or other third parties with respect 
to Year 2000 problems. 
EURO CURRENCY ISSUE 
On January 1, 1999, eleven of the fifteen countries which are 
members of the European Union are scheduled to introduce 
a new currency unit called the "euro." Prior to the full imple- 
mentation of the new currency for the participating coun- 
tries on January 1, 2002, there will be a transition period 
during which parties may use either the existing currencies 
or the euro. However, all exchanges between currencies of 
the participating countries are required to be converted first 
into the euro and then into the other country's currency. 
Delta's internal customer reservations systems and busi- 
ness support systems and processes are currently being modified 
to operate effectively in the euro environment. The Company 
expects these modifications to be completed by the end of 
the December 1998 quarter. Delta also depends on third 
party financial institutions, computer reservation systems 
and IATA programs to process most of its international ticket 
payment and refund transactions and therefore is reviewing 
their respective euro-related conversion plans. Delta does 
not expect the implementation of the euro currency to have 
a material adverse impact on the Company's business or 
consolidated financial statements. 
 Delta's expectations regarding the euro currency issue 
are forward-looking statements that involve a number of 
risks and uncertainties that could cause the actual results to 
differ materially from the projected results. Factors that may 
cause these differences include, but are not limited to, the 
ability or willingness of third parties to convert affected sys- 
tems in a timely manner; the ability of the Company to 
modify its systems and processes in a timely manner; and 
the actions of governmental agencies or other third parties 
with respect to euro currency issues. 
OTHER MATTERS 
Stock Split 
In July 1998, Delta's Board of Directors approved a two-for- 
one Common Stock split, subject to shareowner approval 
of an amendment to the Company's Certificate oflncorpo- 
ration to increase the number of shares of Common Stock 
the Company is authorized to issue and to effect the pro- 
posed split. If the amendment is approved by shareowners 
at Delta's October 22, 1998 annual meeting, the split would 
be effective for common shareowners of record at 5 p.m., 
eastern standard time, on November 2, 1998. 
Common Stock Repurchase Programs 
For information regarding the Company's Common Stock 
repurchase programs, see Note 14 of Notes to Consolidated 
Financial Statements. 
Broad-Based Employee Stock Option Plans 
During fiscal 1997, the Company's shareowners approved 
two plans providing for the issuance of non-qualified stock 
options to substantially all of Delta's non-officer personnel. 
For additional information regarding these plans, see Note 13 
of Notes to Consolidated Financial Statements. 
Change in Estimate 
As a result of a review of its aircraft fleet plan and comparable 
industry practices, the Company increased the depreciable 
life of certain new generation aircraft types from 20 to 25 years. 
The change in estimate is effective July l, 1998. 
Alliance Agreement 
On April 29, 1998, Delta and United Air Lines, Inc. (United) 
entered into a marketing alliance agreement (Agreement) pur- 
suant to which the two airlines would engage in code-sharing 
arrangements, reciprocal frequent flyer programs and other 
areas of marketing cooperation. 
The implementation of the code-sharing aspects of the 
Agreement is subject to the approval of both companies' 
pilot unions. In August 1998, Delta's Board of Directors 
(Board) decided not to grant the request of the Delta pilot 
union for a voting seat on the Board. Following this deci- 
sion, the Delta pilot union said it would no longer consider 
the approval of the code-sharing aspects of the Agreement. 
As a result, Delta has discontinued consideration of code- 
sharing arrangements with United. 
On September 1, 1998, Delta and United began 
reciprocal frequent flyer program participation. 
Personnel Matters 
On May 1, 1996, the Company and the Air Line Pilots 
Association, International (ALPA) entered into a new 
collective bargaining agreement covering the rates of pay, 
rules and working conditions of the Company's approxi- 
mately 8,800 pilots. The contract, which becomes amend- 
able on May 2, 2000, provides in part (1) that if the Company 
operates an aircraft type (New Equipment) for which the 
rates of pay, rules and working conditions (collectively, 
Pay Rates) are not set forth in the collective bargaining 
agreement, the Company and ALPA will negotiate the Pay 
Rates applicable to the New Equipment; (2) that pilots 
will fly the New Equipment whether or not Pay Rates for 
the equipment have been agreed upon; but (3) that the 
pilots' obligation to fly the New Equipment will end if Pay 
Rates have not been agreed upon within six months after 
the Company places the New Equipment into operation. 
The Company has placed orders to purchase the following 
aircraft types, each of which constitutes New Equipment under 
the collective bargaining agreement: B-737-600/700/800 
aircraft; B-777-200 aircraft; and B-767-400 aircraft. Delta 
plans to place these aircraft types in service shortly after 
their delivery, which is expected to begin in October 1998, 
1 9 9 8 AN N UAL RE PO R T 31 
 MA AGEMENT' DI U ION AND ANALYSI 
OF FI A IAL C NDITION AND R ULTS OF OP E RATIO N continued 
D E LTA AIR LIN E , IN 
March 1999, and May 2000, respectively. In addition, the 
Company is leasing from a third party eight B-737-300 
aircraft and has agreed, subject to certain conditions, to lease 
one additional B-737-300 aircraft which also constitutes 
New Equipment under the collective bargaining agreement. 
The Company placed the first of these leased aircraft in 
service in July 1998. 
In October 1997, the Company andALPA began dis- 
cussions on the Pay Rates applicable to B-737-600/700/800 
aircraft and the nine B-737-300 aircraft discussed above. 
ALPA has announced plans to request pilots not to fly these 
aircraft types subsequent to the six-month period after such 
aircraft are initially placed in service unless and until Pay 
Rates for these aircraft are agreed upon. Additionally, in 
January 1998, the Company's pilots voted to authorize 
ALPA to assess pilots 1 % of their gross pay for up to nine 
months to finance a contingency fund for pilots who would 
have flown these aircraft. 
On June 23, 1998, the CompanyandALPA reached 
an agreement regarding Pay Rates applicable to the B-737 
aircraft discussed above (B-737 Agreement). The B-737 
Agreement is subject to the approval of Delta's pilots. ALPA 
is planning to distribute ballots to pilots beginning in Sep- 
tember to vote on the B-737 Agreement, and to announce 
the results of the voting in October. The outcome of this mat- 
ter cannot presently be determined. 
Governmental Matters 
On April 6, 1998, the U.S. Department of Transportation 
(DOT) published a proposed statement of enforcement 
policy to address DOT concerns that major carriers are 
taking actions designed to exclude new entrants in certain 
airline markets, particularly at hub airports. The proposed 
DOT guidelines focus on unreasonable price cuts and/ or 
capacity increases by major carriers in response to entry by 
new carriers at hub airports, and whether the major carrier 
could have pursued a more reasonable alternative strategy 
for competing with the new entrant. The proposed policy, 
if adopted, could adversely affect Delta's ability to respond 
to competitive challenges by new entrant carriers. 
32 D E L T A A I R L I N E S 
Competitive Environment 
Delta expects that low-fare competition will continue in 
domestic and international markets. If price reductions are 
not offset by increases in traffic or changes in the mix of 
traffic that improve the passenger mile yield, Delta's 
operating results will be adversely affected. 
Environmental and Legal Contingencies 
The Company is a defendant in certain legal actions 
relating to alleged employment discrimination practices, 
antitrust matters, environmental issues and other matters 
concerning the Company's business. Although the ultimate 
outcome of these matters cannot be predicted with cer- 
tainty, management believes that the resolution of these 
actions is not likely to have a material adverse effect on 
Delta's consolidated financial statements. 
Forward-Looking Information 
Delta and its representatives may make forward-looking 
statements, within the meaning of the Private Securities 
Litigation Reform Act of 1995, about the Company and its 
business from time to time, either orally or in writing. These 
forward-looking statements involve a number of risks and 
uncertainties that could cause the actual results to differ 
materially from the projected results. It is not possible to 
list all of the many factors and events that could cause the 
actual results to differ materially from the projected results. 
Such factors and events may include, but are not limited to: 
(1) competitive factors such as the airline pricing environ- 
ment and the capacity decisions of other airlines; (2) general 
economic conditions; (3) changes in aircraft fuel prices; 
(4) fluctuations in foreign currency exchange rates; (5) actions 
by the United States and foreign governments; and (6) the 
willingness of customers to travel. 
New Accounting Standards 
In June 1997, the Financial Accounting Standards Board 
(FASB) issued Statement of Financial Accounting Standards 
No. 130, "Reporting Comprehensive Income" (SFAS 130), 
and Statement of Financial Accounting Standards No. 131, 
"Disclosures about Segments of an Enterprise and Related 
Information" (SFAS 131). SFAS 130 establishes standards 
 for the reporting and presentation of comprehensive income 
and its components. SFAS 131 establishes standards for 
reporting information about operating segments. Delta is 
required to adopt both SFAS 130 and SFAS 131 in fiscal 
1999. The adoption ofSFAS 130 and SFAS 131 will not 
have a material effect on the Company's financial statements. 
In March 1998, the American Institute of Certified 
Public Accountants (AICPA) issued Statement of Position 
98-1, ''Accounting for Costs of Computer Software Devel- 
oped or Obtained for Internal Use" (SOP 98-1), which 
defines the type of costs related to such activities that should 
be capitalized versus expensed as incurred. 
In April 1998, the AI CPA issued Statement of Position 
98-5, "Reporting on the Costs of Start-Up Activities" 
(SOP 98-5), which requires all costs incurred in the start- 
up of a new business or business segment to be expensed 
as incurred. 
In June 1998, the FASB issued Statement of Financial 
Accounting Standards No. 133, ''Accounting for Derivative 
Instruments and Hedging Activities" (SFAS 133), which 
establishes accounting and reporting standards for derivatives 
and hedging activities. 
Delta is required to adopt SOP 98-1, SOP 98-5 and 
SFAS 133 in fiscal 2000. The adoption of these statements 
is not expected to have a material impact on the Company's 
financial statements. 
MARKET RISKS ASSOCIATED WITH 
FINANCIAL INSTRUMENTS 
Commodity Price Risk 
The Company's results of operations are significantly 
impacted by changes in the price of aircraft fuel. During 
fiscal 1998, aircraft fuel accounted for 12% of the Com- 
pany's operating expenses. Based on the Company's fiscal 
1999 projected aircraft fuel consumption of 2. 7 billion gal- 
lons, a one-cent change in the average annual price per gal- 
lon of aircraft fuel would impact Delta's annual aircraft fuel 
expense by approximately $27 million. The Company uses 
fuel swap and option contracts to manage aircraft fuel price 
risk. At June 30, 1998, the Company had entered into 
hedge agreements for 2.1 billion gallons of its projected 
fiscal 1999 aircraft fuel requirements. (See Note 4 of Notes 
to Consolidated Financial Statements.) 
Equity Price Risk 
At June 30, 1998, the quoted fair value of Delta's equity 
investments in ASA Holdings, Inc., Comair Holdings, Inc., 
Singapore Airlines Limited, SAirGroup and SkyWest, Inc. 
was approximately $1.3 billion. 
The aggregate unrealized gain from these investments 
was $785 million at June 30, 1998. The market risk associ- 
ated with these equity investments is the potential loss in 
fair value resulting from a decrease in market prices. In addi- 
tion, Delta has exposure to foreign currency exchange rate 
risk relating to its investments in Singapore Airlines and 
SAirGroup. See Notes 2 and 3 of Notes to Consolidated 
Financial Statements. 
Interest Rate Risk 
The Company's exposure to market risk for changes in 
interest rates relates to its long-term debt obligations and 
cash investment portfolio. 
At June 30, 1998, the fair value of the Company's long- 
term fixed-rate debt was estimated at approximately $1.9 bil- 
lion using quoted market prices where available, or discounted 
cash flow analyses. Market risk associated with the Company's 
long-term debt is the potential increase in fair value resulting 
from a decrease in interest rates. A 10% decrease in assumed 
interest rates would increase the fair value of Delta's long- 
term debt by approximately $117 million. 
Based on the Company's average balance of cash equiv 
alents and short-term investments during fiscal 1998, a 10% 
decrease in the average interest rate experienced in fiscal 1998 
would not materially impact Delta's annual interest income. 
Foreign Currency Exchange Rate Risk 
Delta is exposed to foreign currency exchange rate fluctua- 
tions on the U.S. dollar value offoreign currency denomi- 
nated transactions. Based on the Company's average net 
currency positions in fiscal 1998, the potential loss due to a 
10% adverse change in foreign currency exchange rates is 
immaterial. The Company enters into certain foreign 
exchange forward contracts, generally with maturities ofless 
than two months, to manage its foreign currency exchange 
rate risk. The principal amount of such contracts was approxi- 
mately $26 million at June 30, 1998. 
I 9 9 8 A N N U A L R E P O R T 33 
 CON OLIDATED BALAN E SHEET 
JUNE 30 , 1998 AND 199 7 
DELTA AIR LINE IN 
(In Millions) 
Current Assets: 
Cash and cash equivalents 
hort-term investments 
Accounts receivable, net of allowance for uncollectible accounts of 
$36 atJune30, 1998 and $48 atJune30, 1997 
Deferred income taxes 
Prepaid expenses and other 
Total current assets 
Property and Equipment: 
Flight equipment 
Less: Accumulated depreciation 
Flight equipment under capital leases 
Less: Accumulated amortization 
Ground property and equipment 
Less: Accumulated depreciation 
Advance payments for equipment 
Total property and equipment 
Other Assets: 
Marketable equity securities 
Deferred income taxes 
Investments in associated companies 
Cost in excess of net assets acquired, net of accumulated amortization of 
$112 at June 30, 1998 and $102 at June 30, 1997 
Leasehold and operating rights, net of accumulated amortization of 
$209 at June 30, 1998 and $199 at June 30, 1997 
Other 
Total other assets 
Total assets 
34 D E L T A A I R L I N E S 
$ 
- - - - - - - 
1998 
1,077 
557 
938 
464 
326 
3,362 
11,180 
3,895 
7,285 
515 
216 
299 
3,285 
1,854 
1,431 
306 
9,321 
424 
326 
265 
124 
781 
1,920 
$14,603 
$ 
1997 
662 
508 
943 
413 
341 
2,867 
9,619 
3,510 
6,109 
523 
176 
- - 
347 
3,032 
1,758 
1,274 
312 
8,042 
432 
103 
299 
275 
134 
589 
1,832 
$12,741 
 LIABILITIES AND SHAREOWNERS' EQUITY 
(In Millions, Except Share Data) 
Current Liabilities: 
Current maturities oflong-term debt 
Current obligations under capital leases 
Accounts payable and miscellaneous accrued liabilities 
Air traffic liability 
Accrued rent 
Accrued salaries and vacation pay 
Total current liabilities 
Noncurrent Liabilities: 
Long-term debt 
Postretirement benefits 
Accrued rent 
Capital leases 
Deferred income taxes 
Other 
Total noncurrent liabilities 
Deferred Credits: 
Deferred gain on sale and leaseback transactions 
Manufacturers' and other credits 
Commitments and Contingencies (Notes 6, 7, 8 and 9) 
Employee Stock Ownership Plan Preferred Stock: 
Series B ESOP Convertible Preferred Stock, $1.00 par value, $72.00 stated and 
liquidation value; issued and outstanding 6,603,429 shares at June 30, 1998 
and 6,668,248 shares at June 30, 1997 
Unearned compensation under employee stock ownership plan 
Shareowners' Equity: 
Common stock, $3.00 par value; authorized 150,000,000 shares; issued 
88,283,089 shares at June 30, 1998 and 83,645,047 shares at June 30, 1997 
Additional paid-in capital 
Retained earnings 
Net unrealized gain on marketable equity securities 
Treasury stock at cost, 13,057,892 shares at June 30, 1998 and 
9,949,060 shares at June 30, 1997 
Total shareowners' equity 
Total liabilities and shareowners' equity 
The accompanying notes are an integral part of these Consolidated Balance Sheets. 
$ 
1998 
67 
63 
2,025 
1,667 
202 
553 
4,577 
1,533 
1,873 
651 
249 
262 
511 
5,079 
694 
55 
749 
475 
(300) 
175 
265 
3,034 
1,687 
89 
(1,052) 
4,023 
$14,603 
$ 
1997 
236 
62 
1,691 
1,418 
213 
463 
4,083 
1,475 
1,839 
602 
322 
406 
4,644 
746 
105 
851 
480 
(324) 
156 
251 
2,645 
711 
101 
(701) 
3,007 
$12,741 
I 9 9 8 A N N U A L R E P O R T 35 
 C LIDATED S TATEMENT F O PERATIONS 
F R THE EAR ENDED JUNE 30, 1 998, 199 7 AND 1 996 
DELT AIR LI E , IN 
{In Millions, Except Per 'hare Data) 1998 1997 1996 
-- - - 
Operating Revenues: 
Passenger $12,976 $12,505 $11 ,616 
Cargo 582 554 521 
Other, net 580 535 318 
- - - - - - 
Total operating revenues 14,138 13,594 12,455 
Operating Expenses: 
alaries and related costs 4,850 4,534 4,206 
Aircraft fuel 1,507 1,722 1,464 
Passenger commissions 980 1,017 1,042 
Depreciation and amortization 861 710 634 
Contracted services 694 630 704 
Other selling expenses 681 677 594 
Landing fees and other rents 649 649 627 
Aircraft rent 552 547 555 
Aircraft maintenance materials and outside repairs 495 434 376 
Passenger service 450 389 368 
Restructuring and other non-recurring charges 52 829 
Other 726 702 593 
Total operating expenses 12,445 12,063 11,992 
Operating Income 1,693 1,531 463 
Other Income (Expense): 
Interest expense (186) (207) (269) 
Interest capitalized 38 33 26 
Interest income 79 63 86 
Miscellaneous income (expense), net 24 (5) (30) 
(45) (116) (187) 
Income Before Income Taxes 1,648 1,415 276 
Income Taxes Provided (647) (561) (120) 
- - - - 
Net Income 1,001 854 156 
Preferred Stock Dividends (11) (9) (82) 
Net Income Available to Common Shareowners $ 990 $ 845 $ 74 
Basic Income Per Common Share $ 13.28 $ 11.39 $ 1.43 
Diluted Income Per Common Share $ 12.68 $ 11.03 $ 1.43 
The accompanying notes are an integral part of these consolidated statements. 
36 0 E L T A A I R L I N E S 
 CONSOLIDATED STATEMENTS OF CASH FLOWS 
FOR THE YEARS ENDED JUNE 30 , 1 998 , 19 9 7 AND 1996 
DELTA AIR LINES , INC. 
(In Millions) 1998 
Cash Flows from Operating Activities: 
Net income $ 1,001 
Adjustments to reconcile net income to cash provided 
by operating activities: 
Restructuring and other non-recurring charges 
Depreciation and amortization 861 
Deferred income taxes 294 
Rental expense less than rent payments (17) 
Pension, postretirement and postemployment expense in excess 
of (less than) payments 179 
Changes in certain current assets and liabilities: 
Decrease (increase) in accounts receivable 5 
Decrease (increase) in prepaid expenses and other 
current assets 15 
Increase in air traffic liability 249 
Increase (decrease) in other payables and accrued expenses 330 
Other, net (1) 
Net cash provided by operating activities 2,916 
Cash Flows from Investing Activities: 
Property and equipment additions: 
Flight equipment, including advance payments (1,760) 
Ground property and equipment (531) 
Decrease (increase) in short-term investments, net (43) 
Proceeds from sale of flight equipment 10 
Net cash used in investing activities (2,324) 
Cash Flows from Financing Activities: 
Payments on long-term debt and capital lease obligations (307) 
Cash dividends (43) 
Issuance oflong-term obligations 125 
Issuance of Common Stock 318 
Income tax benefit from exercise of stock options 84 
Repurchase of Common Stock (354) 
Net cash used in financing activities (177) 
Net Increase (Decrease) in Cash and Cash Equivalents 415 
Cash and cash equivalents at beginning of fiscal year 662 
Cash and cash equivalents at end of fiscal year $ 1,077 
The accompanying notes are an integral part of these consolidated statements. 
1997 1996 
$ 854 $ 156 
52 829 
710 634 
240 (57) 
(58) (32) 
92 (67) 
25 (213) 
(31) (47) 
4 271 
186 (91) 
(35) 8 
2,039 1,391 
(1,598) (639) 
(350) (297) 
(1) 22 
8 26 
(1,941) (888) 
(196) (440) 
(44) (120) 
38 35 
(379) (66) 
(581) (591) 
(483) (88) 
1,145 1,233 
$ 662 $1,145 
I 9 9 8 A N N U A L R E P O R T 37 
 CON OLIDATED STATEMENT OF SHAREOWNER ' EQUITY 
F R THE YEAR ENDED JUNE 30, 1998, 199 7 AND 1996 
DELTA AIR LINE , I 
Unrealized 
Additional Retained Gain (Los) 
ommon Paid-In Earning on Equity Treasury 
(In Millions, Except Share Data) tock apical (Deficit) Securities tock Total 
-- ---~-- - 
Balance at June 30, 1995 $164 $2,016 $ (184) $ 83 $ (252) $1,827 
Fiscal Year 1996: 
et income 156 156 
Dividends on Series C Convertible Preferred cock (74) (74) 
Dividends on Common Srock ($0.20 per share) (10) (10) 
Dividends on Series B ESOP Convertible 
Preferred Srock allocated shares (8) (8) 
Issuance of719,562 shares of Common Srock under 
dividend reinvestment and stock purchase plan 
and stock options ($58.15 per share) 2 40 (5) 37 
Issuance of 6,861,377 shares of Common Stock on 
conversions of Series C Preferred Stock ($64.37 per share) 21 (21) 
Issuance of 10,147,952 shares of Common Srock 
on conversions of 3.23% Convertible 
Subordinated Notes ($61.17 per share) 30 592 622 
Transfer of 176,794 shares of Common Srock 
from treasury under ESOP and stock 
incentive plan ($67.77 per share) 12 13 
Repurchase of821,300 common shares ($80.00 per share) (66) (66) 
Net unrealized gain on marketable equity securities and other 43 43 
Balance at June 30, 1996 217 2,627 (119) 126 (311) 2,540 
- - - - - 
Fiscal Year 1997: 
Net income 854 854 
Dividends on Common Srock ($0.20 per share) (15) (15) 
Dividends on Series B ESOP Convertible 
Preferred Srock allocated shares (9) (9) 
Issuance of748,492 shares of Common Srock under 
dividend reinvestment and stock purchase plan 
and stock options ($65.22 per share) 2 47 (7) 42 
Issuance of 10,629,465 shares of Common Stock on 
conversions of Series C Preferred Stock ($64.38 per share) 32 (32) 
Repurchase of 5,378,700 common shares ($70.53 per share) (379) (379) 
Net unrealized loss on marketable equity securities and ocher 3 (25) (4) (26) 
Balance at June 30, 1997 251 2,645 711 101 (701) 3,007 
Fiscal Year 1998: 
Net income 1,001 1,001 
Dividends on Common Stock ($0.20 per share) (15) (15) 
Dividends on Series B ESOP Convertible 
Preferred Srock allocated shares (11) (11) 
Issuance of 4,638,042 shares of Common Stock under 
dividend reinvestment and stock purchase plan 
and stock options ($68.56 per share) 14 304 318 
Repurchase of3, 158,373 common shares 
($112.08 per share) (354) (354) 
Income Tax Benefit from exercise of stock options 84 84 
Transfer of 49,541 shares of Common Stock from treasury 
under stock incentive plan ($77.17 per share) 3 3 
Net unrealized loss on marketable equity securities and ocher 1 1 (12) (1 O) 
Balance at June 30, 1998 $265 $3,034 $1,687 $ 89 $(1,052) $4,023 
The accompanying notes are an integral part of these consolidated statements. 
38 D E L T A A I R L I N E S 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
JUNE 3 0 , 1998 , 199 7 AND 1996 
DELTA AIR LINE S , IN C. 
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
Nature of Business - Delta Air Lines, Inc. (a Delaware 
corporation) is a major air carrier providing scheduled air 
transportation for passengers, freight and mail over a net- 
work of routes throughout the United States and abroad. 
At August 1, 1998, Delta served 148 domestic cities in 42 
states, the District of Columbia, Puerto Rico and the U.S. 
Virgin Islands, as well as 46 cities in 31 foreign countries. 
Basis of Presentation - The consolidated financial state- 
ments include the accounts of Delta Air Lines, Inc. and its 
wholly owned subsidiaries (Delta or the Company). All 
significant intercompany account balances and transac- 
tions have been eliminated. Certain prior year amounts 
have been reclassified to conform with the current year 
financial statement presentation. 
Use of Estimates- The Company follows generally accepted 
accounting principles (GMP). The preparation of financial 
statements in conformity with GAAP requires management 
to make estimates and assumptions that affect the amounts 
reported in the consolidated financial statements and 
accompanying notes. Actual results could differ from 
those estimates. 
Accounting Changes - During fiscal 1998, the Company 
adopted Statement of Financial Accounting Standards 
(SFAS) No. 128, "Earnings Per Share" (SFAS 128), and 
SFAS No. 132, "Employers' Disclosures about Pensions and 
Other Postretirement Benefits" (SFAS 132). (See Notes 11 
and 10, respectively.) During fiscal 1997, the Company 
adopted SFAS No. 123, "Accounting for Stock-Based 
Compensation" (SFAS 123). (See Note 13.) 
Cash and Cash Equivalents - Investments with an original 
maturity of three months or less are classified as cash and 
cash equivalents. These investments are stated at cost, 
which approximates fair value. 
Short-Term Investments - Cash in excess of operating 
requirements is invested in short-term, highly liquid 
investments. These investments are classified as available- 
for-sale under SFAS No. 115, ''Accounting for Certain 
Investments in Debt and Equity Securities" (SFAS 115), 
and are stated at fair value. (See Note 2.) 
Depreciation andAmortiza.tion - Effective July 1, 1998, 
the Company increased the depreciable life of certain new 
generation aircraft types from 20 to 25 years. Owned flight 
equipment is depreciated on a straight-line basis to a residual 
value equal to 5% of cost. Flight equipment under capital 
leases is amortized on a straight-line basis over the original 
terms of the respective leases, which generally range from 
4 to 11 years. Ground property and equipment are depreci- 
ated on a straight-line basis over their estimated service lives, 
which range from 3 to 30 years. Costs assigned to the pur- 
chase ofleasehold rights and landing slots are amortized 
over the lives of the respective leases at the associated airports. 
Purchased international route authorities are amortized 
over the lives of the authorities as determined by their expi- 
ration dates. Permanent route authorities with no stated 
expiration dates are amortized over 40 years. 
Interest Capitalized - Interest attributable to funds used to 
finance the acquisition of new aircraft and construction of 
major ground facilities is capitalized as an additional cost 
of the related asset. Interest is capitalized at the Company's 
weighted average interest rate on long-term debt or, where 
applicable, the interest rate related to specific borrowings. 
Capitalization of interest ceases when the property or 
equipment is placed in service. 
Investments in Associated Companies - The Company's 
investments in the following companies are accounted 
for under the equity method: WORLDSPAN, L.P. 
(WORLDSPAN), a computer reservations system partner- 
ship; ASA Holdings, Inc. (ASA), the parent of Atlantic 
Southeast Airlines, Inc.; Comair Holdings, Inc. (Comair), 
the parent of Comair, Inc.; and Empresa de Transporte 
Aereo del Peru, SA., Aeroperu (Aeroperu). Effective July 1997, 
the Company began accounting for its investment in 
SkyWest, Inc. (SkyWest), the parent of SkyWest Airlines, 
Inc., under the cost method. (See Note 2.) Atlantic 
Southeast Airlines, Inc., Comair, Inc., and SkyWest Airlines, 
Inc. are participants in the Delta Connection program. 
Cost in Excess of Net Assets Acquired - The cost in excess of 
net assets acquired (goodwill), which is being amortized 
over 40 years, is primarily related to the Company's acqui- 
sition of Western Air Lines, Inc. in December 1986. 
Frequent Flyer Program - The Company accrues the esti- 
mated incremental cost of providing free travel awards earned 
under its SkyMiles frequent flyer program when free travel 
I 9 9 8 A N N U A L R E P O R T 39 
 NOTE TO C N OLIDATED FINAN IAL TAT E M E N T S continued 
JU E 30, 1998 , 199 7 AND 1996 
DELTA AIR LI E , INC . 
award levels are achieved. The accrued incremental cost is 
included in accounts payable and miscellaneous accrued 
liabilities in the Company's Consolidated Balance Sheets. 
The Company also ells mileage credits to participating 
partners in the kyMiles program such as hotels, car rental 
agencies and credit card companies. The resulting revenue 
is recorded as other operating revenue in the Company's 
Consolidated tatements of Operations during the period 
in which the credits are sold. 
Passenger and Cargo Revenues - Passenger ticket sales are 
recorded as air traffic liability in the Company's Consoli- 
dated Balance Sheets. Passenger and cargo revenues are 
recognized when the transportation is provided, reducing 
the air traffic liability, as applicable. 
Deferred Gains on Sale and Leaseback Transactions - Gains 
on the sale and leaseback of property and equipment under 
operating leases are deferred and amortized over the lives of 
the respective leases as a reduction in rent expense. Gains on 
the sale and leaseback of property under capital leases are 
credited directly to the carrying value of the related asset. 
Manufacturers' Credits-In connection with the acquisi- 
tion of certain aircraft and engines, the Company receives 
certain credits. These credits are deferred until the aircraft 
and engines are delivered, at which time the credits are 
applied on a pro rata basis as a reduction of the acquisition 
cost of the related equipment. 
Advertising Costs -Advertising costs are expensed when 
incurred and are included as a component of other sell- 
ing expense. Advertising expense for fiscal 1998, 1997 
and 1996 was $105 million, $121 million and $109 mil- 
lion, respectively. 
Foreign Currency Remeasurement-Assets and liabilities 
denominated in foreign currencies are remeasured generally 
at exchange rates in effect at the balance sheet date, except 
fixed assets are recorded at exchange rates in effect when 
the assets were acquired. The resulting foreign exchange 
gains and losses are recognized as a component of miscella- 
neous income (expense). Revenues and expenses from 
foreign operations are recorded using applicable average 
monthly exchange rates prevailing during the year, except 
depreciation and amortization charges are recorded at the 
exchange rate in effect when the related assets were acquired. 
40 D E L T A A I R L I N E S 
Stock-Based Compensation - The Company accounts for 
its stock-based compensation plans in accordance with 
Accounting Principles Board Opinion No. 25, "Accounting 
for tock Issued to Employees" (APB 25). Under APB 25, 
no compensation expense is recognized for a stock option 
grant if the exercise price of the stock option at the measure- 
ment date is equal to or greater than the fair market value of 
the ommon Stock on the dace of grant. (See Note 13.) 
2. FINANCIAL INSTRUMENTS 
All financial instruments, except long-term debt, are car- 
ried at fair value or have a carrying value which approxi- 
mates fair value. 
Long-Term Debt- The fair values and carrying values of 
long-term debt, including current maturities, at June 30, 
1998 and 1997, were as follows: 
(In Billions) 
Fair value 
Carrying value 
1998 
$1.9 
1.6 
1997 
$1.8 
1.7 
These values are based on quoted market prices, where 
available, or discounted cash flow analyses. 
Marketable Equity Securities - Effective July 1, 1997, the 
Company began accounting for its investment in SkyWest 
under the cost method due co dilution in the Company's 
equity ownership in SkyWest. The Company's investments 
in Singapore Airlines Limited (Singapore Airlines), SAirGroup 
(formerly Swissair, Swiss Air Transport Company Ltd.) and 
SkyWest are classified as available-for-sale under SFAS 115 
and are recorded at fair value. The following table summa- 
rizes the Company's investments in Singapore Airlines, 
SAirGroup and SkyWest: 
Quoted Cost Unrealized 
(in Millions) Fair Value Basis Gain (Loss) 
June 30, June 30, 
1998 1997 1998 1997 
Singapore Airlines $165 $315 $181 $(16) $134 
SAirGroup $172 $117 $ 85 $ 87 $ 32 
SkyWest $ 87 NIA* $ 14 $ 73 NIA* 
* Prior to fiscal I 998, the Company accounted for its investment in Sky West under the equity 
method. (See Note 3.) 
 The aggregate unrealized gains, net of the related deferred 
tax provision, of these investments at June 30, 1998 and 1997 
are reflected in shareowners' equity. Delta's right to vote, to 
transfer or to acquire additional shares of the stock of Singa- 
pore Airlines and SAirGroup is subject to certain restrictions. 
Short-Term Investments- The Company invests its cash in 
excess of operating requirements in short-term, highly-liquid 
investments. These investments are classified as available- 
for-sale securities, have an average stated maturity of eight 
months, and are recorded as short-term investments in the 
Company's Consolidated Balance Sheets. The aggregate fair 
value of these investments was $557 million and $508 mil- 
lion at June 30, 1998 and 1997, respectively. Unrealized 
gains and losses from these investments, net of deferred taxes, 
are reflected in shareowners' equity. Such amounts were 
immaterial at June 30, 1998 and 1997. 
3. INVESTMENTS IN ASSOCIATED COMPANIES 
The Company's percentage ownership and quoted fair 
value (where applicable) of its investment in associated 
companies at June 30, 1998, and equity earnings (losses) 
for fiscal 1998, 1997 and 1996, were as follows: 
Quoted 
Percentage Fair 
Investment Ownership Value 1998 1997 
(In Millions} 
WORLDSPAN 38% NIA 14 $23 
ASA 27 $397 17 15 
Comair 21 434 25 16 
Aeroperu 35 NIA 
SkyWest 13 87 NIA 2 
1996 
$(5) 
13 
13 
4. RISK MANAGEMENT 
Fuel Price Risk Management- Delta enters into fuel swap 
and option contracts up to one year in duration to manage 
risk associated with changes in aircraft fuel prices. Under 
these contracts, Delta receives or makes payments based on 
differences between fixed and variable prices for certain 
fuel commodities. Gains and losses from fuel swap and 
option contracts are deferred and recognized as a component 
of fuel expense when the underlying fuel being hedged is 
used. Premiums paid to enter into hedging contracts are 
recorded as a prepaid expense and amortized to fuel expense 
over the respective contract period. At June 30, 1998, the 
Company had entered into hedge agreements for 2.1 billion 
gallons of its projected fiscal 1999 aircraft fuel requirements. 
At June 30, 1998, unrealized gains and losses from these 
contracts were immaterial. 
Foreign Exchange Risk Management- Delta enters into 
foreign exchange forward contracts, generally with maturi- 
ties ofless than two months, to manage risk associated with 
its net foreign currency denominated positions. The prin- 
cipal amount, which approximates fair value, of outstand- 
ing foreign exchange forward contracts was approximately 
$26 million at June 30, 1998. Gains and losses resulting 
from foreign exchange forward contracts are recognized as 
a component of miscellaneous income (expense). 
Credit Risks- To manage credit risk associated with its fuel 
price risk and foreign exchange risk management programs, 
the Company selects counterparties based on their credit rat- 
ings, limits its exposure to any one counterparty under defined 
guidelines, and monitors the market position of the program 
and its relative market position with each counterparty. 
Concentration of Credit Risk - Delta's accounts receivable 
are generated primarily from airline ticket and cargo service 
sales to individuals and various commercial enterprises that 
are economically and geographically dispersed, and the 
accounts receivable are generally short-term in duration. 
Accordingly, Delta does not believe it is subject to any 
significant concentration of credit risk. 
I 9 9 8 A N N UAL R E PO RT 41 
 NOTE TO CON OLIDATED FINAN IAL STATEMENT continued 
JU E 30, 1998, 199 7 AND 1996 
DELTA AIR LI E , IN 
5. INCOME TAXE 
Deferred income taxes reflect the net tax effect of tempo- 
rary differences between the carrying amounts of assets and 
liabilities for financial reporting purposes and for income 
tax purposes. Significant components of the Company's 
deferred tax assets and liabilities as of June 30, 1998 and 
1997 are a result of temporary differences related to the 
items described below: 
(In Millions) 
Deferred Tax Assets: 
Postretiremenc benefits 
Other employee benefits 
Gains on sale and leaseback 
transactions (net) 
Rene expense 
Spare parts repair expense 
Alternative minimum tax 
credit carryforwards 
Other 
Total Deferred Tax Assets 
Deferred Tax Liabilities: 
1998 
$ 756 
405 
257 
200 
139 
107 
159 
$2,023 
Depreciation and amortization $1,446 
Other 375 
- - - - - - - - - - - - - - - - - 
Tot al Deferred Tax Liabilities $1,821 
1997 
$ 741 
328 
302 
212 
122 
216 
212 
$2,133 
$1,239 
378 
$1,617 
Income taxes provided in fiscal 1998, 1997 and 1996 
consisted of: 
(In Millions) 
Current taxes 
Deferred taxes 
Tax benefit of dividends on 
allocated Series B ESO P 
Convertible Preferred Stock 
Income taxes provided 
42 D E L T A A I R L I N E S 
1998 
$(353) 
(298) 
4 
$(647) 
1997 
$(321) 
(244) 
4 
$(561) 
1996 
$(177) 
54 
3 
$(120) 
The income tax provisions generated for fiscal 1998, 
1997 and 1996 differ from amounts which would result 
from applying the federal statutory tax race to pretax 
income, as follows: 
(In Millions) 1998 1997 1996 
Income before income taxes $1,648 $1,415 $ 276 
Items not deductible for 
tax purposes: 
Meals and entertainment 42 39 36 
Amortization 9 9 9 
Ocher, net (27) (17) (8) 
Adjusted pretax income 1,672 1,446 313 
Federal statutory tax rate 35% 35% 35% 
Income tax provision at 
statutory rate (585) (506) (110) 
State and ocher income taxes, net 
of federal income tax provision (62) (55) (10) 
Income taxes provided $ (647) $ (561) $(120) 
The Company made income tax payments, nee ofincome 
tax refunds, of $244 million in fiscal 1998, $336 million in 
fiscal 1997 and $192 million in fiscal 1996. 
 6. LONG-TERM D EBT 
At June 30, 1998 and 1997, the Company's long-term debt (including current maturities) was as follows: 
(In Millions) 
93/s% Notes, unsecured, due January 1, 1998 
Medium-Term Notes, Series A and B, unsecured, interest rates from 
7.79% to 9.15%; maturities ranging from 1998 to 2007 
93/s% Notes, unsecured, due May 15, 2000 
8% Notes, unsecured, due March 15, 2002 
1998 
$ 
128 
142 
71 
1997 
$ 207 
157 
142 
71 
8.10% Series C Guaranteed Serial ESOP Notes, unsecured, due in installments between 2002 and 2009 
Development Authority of Fulton County, unsecured loan agreement, due $10 million on November 1, 2007 
290 290 
and $20 million on November 1, 2012. Interest rates from 6.85% to 6.95% 
10V 
s% Debentures, unsecured, due May 15, 2010 
30 
113 
30 
113 
103/s% Debentures, unsecured, due February 1, 2011 175 175 
Development Authority of Fulton County, unsecured loan agreement, due $19 million on May 1, 2013, 
$85 million on May 1, 2023, and $21 million on May 1, 2033. Interest rates from 5.30% to 5.50% 
9% Debentures, unsecured, due May 15, 2016 
125 
101 101 
75/s% Development Authority of Clayton County, unsecured loan agreement, due on January 1, 2020 
9% Debentures, unsecured, due May 15, 2021 
45 
250 
45 
250 
9% Debentures, unsecured, due March 15, 2022 
103/s% Debentures, unsecured, due December 15, 2022 
Total 
Less: Current maturities 
Total long-term debt 
Under its 1997 Bank Credit Agreement with a group 
of banks, the Company may borrow up to $1.25 billion on 
an unsecured and revolving basis until May 1, 2002, sub- 
ject to compliance with certain conditions. Up to $700 
million of this facility may be used for the issuance oflet- 
ters of credit. The interest rate under this facility is, at the 
Company's option, the London Interbank Offered Rate or 
the prime rate, in each case plus a margin which is subject 
to adjustment based on certain changes in the credit rat- 
ings of the Company's long-term senior unsecured debt. 
The Company also has the option to obtain loans through 
a competitive bid procedure. The 1997 Bank Credit Agree- 
ment contains certain covenants that restrict the Company's 
ability to grant liens, to incur or guarantee debt and to 
enter into flight equipment leases. It also provides that if 
there is a change of control (as defined) of the Company, 
the banks' obligation to extend credit terminates, any 
amounts outstanding become immediately due and payable 
and the Company will immediately deposit cash collateral 
with the banks in an amount equal to all outstanding 
letters of credit. At August 14, 1998, no borrowings or 
letters of credit were outstanding under the 1997 Bank 
Credit Agreement. 
64 64 
66 66 
1,600 1,711 
67 236 
$1,533 $1,475 
At June 30, 1998, there were outstanding $290 million 
principal amount of the Delta Family-Care Savings Plan's 
Series C Guaranteed Serial ESOP Notes (Series C ESOP 
Notes), which are guaranteed by Delta and are payable in 
installments between July 1, 2002 and January 1, 2009. 
The Series C ESOP Notes were issued under note purchase 
agreements (1) which require Delta to purchase the Series 
C ESOP Notes at the option of the holders thereof (Note- 
holders) if the credit rating of Delta's long-term senior 
unsecured debt falls below Baa3 by Moody's and BBB - 
by Standard & Poor's (Purchase Event); but (2) which pro- 
vide that Delta has no obligation to purchase the Series C 
ESOP Notes under the note purchase agreements so long 
as Delta obtains, within 127 days of a Purchase Event, 
certain credit enhancements (Approved Credit Enhance- 
ment) that result in the Series C ESOP Notes being rated 
A3 or higher by Moody's and A- or higher by Standard & 
Poor's (Required Ratings). If Delta is required to purchase 
the Series C ESOP Notes because of the occurrence of a 
Purchase Event, such purchase would be made at a price 
(Purchase Price) equal to the outstanding principal amount 
of the Series C ESOP Notes being purchased, together 
1 9 9 8 A N N U A L R E P O R T 43 
 NOTE TO CON LIDATED FINAN IAL TAT E M N T continued 
JUNE 30, 1998, 199 7 AND 1996 
DELTA AIR LI E , IN 
with accrued interest and a Make Whole Premium Amount. 
The Make Whole Premium Amount is based on, among 
ocher factors, the yield to maturity ofU .. Treasury notes 
having maturities equal to the remaining average life to 
maturity of the Series CE OP Notes as of the date Delta 
purchases the eries CE OP Notes. 
On May 11, 1993, a Purchase Event occurred, and Delta 
became obligated to purchase on September 15, 1993 any 
Series C ESOP Notes tendered to it. Prior to September 15, 
1993, Delta obtained an Approved Credit Enhancement in 
the form of a letter of credit to credit enhance the eries C 
ESOP Notes. This letter of credit was issued in favor of 
Wilmington Trust Company, as trustee (Trustee), under 
Delta's then-existing bank credit agreement. Due to the 
issuance of chis letter of credit, the Series C ESOP Notes 
received the Required Ratings, and Delta no longer had an 
obligation to purchase the Series C ESOP Notes as a result 
of the Purchase Event that occurred on May 11, 1993. 
On June 6, 1996, the Company entered into a credit 
agreement with ABN AMRO Bank, N. V. and a group of 
banks (Letter of Credit Facility) which, as amended, provides 
for the issuance ofletters of credit for up to $500 million in 
stated amount to credit enhance the Series C ESOP Notes. 
The Letter of Credit Facility contains negative covenants and 
a change of control provision chat are substantially similar 
to chose contained in the 1997 Bank Credit Agreement. In 
the event of any drawing under the Letter of Credit Facility, 
Delta is required, at its election, (1) to immediately repay 
the amount drawn; or (2) to convert its reimbursement 
obligation to a loan for a period not to exceed one year at 
varying rates of interest. On June 6, 1996, Delta obtained 
a letter of credit under the Letter of Credit Facility to replace 
the letter of credit issued under its then-existing bank credit 
agreement to credit enhance the Series C ESOP Notes. The 
Letter of Credit Facility expires June 6, 2000. 
At August 14, 1998, the face amount of the letter of 
credit issued under the Letter of Credit Facility was $445 mil- 
lion. It covers the $290 million outstanding principal amount 
of the Series C ESO P Notes, up to $123 million of Make 
Whole Premium Amount and approximately one year of 
interest on the Series C ESOP Notes. 
An Indenture of Trust, dated August 1, 1993 (Indenture), 
among Delta, the Trustee, and Fidelity Management Trust 
Company, as ESOP trustee, contains certain terms and con- 
ditions relating to any letter of credit used to credit enhance 
the Series C ESOP Notes. The Indenture requires the Trustee 
to draw under the letter of credit to make regularly scheduled 
44 D E L T A A I R L I N E S 
payments of principal and interest on the Series C ESOP 
Notes. The Indenture also requires the Trustee to draw under 
the letter of credit to purchase the Series C ESOP Notes in 
certain circumstances in which Delea would not be required 
to purchase the Series C ESOP Notes under the note pur- 
chase agreements. Subject to certain conditions, the Inden- 
ture requires the Trustee to purchase the Series C ESOP 
Notes at the Purchase Price at the option of the Noteholders 
in the event that (1) the Required Ratings on the Notes are 
not maintained; (2) the letter of credit is not extended 20 
days before its scheduled expiration dace; (3) Delta elects 
to terminate the letter of credit; or (4) the Trustee receives 
notice chat there has occurred an event of defaulc under the 
credit agreement relating to the letter of credit; unless, gen- 
erally within 10 days of any such event, the Series C ESOP 
Notes receive the Required Ratings due to Delta's obtaining 
a substitute credit enhancement or otherwise. 
The Required Racings on the Series C ESOP Notes 
are subject to reconsideration at any time, and to annual 
confirmation, by Moody's and Standard & Poor's. Circum- 
stances that might cause either rating agency to lower or 
fail to confirm its rating include, without limitation, a 
downgrading of the deposits of the letter of credit issuer 
below A3 by Moody's or A- by Standard & Poor's, or a 
determination that the Make Whole Premium Amount 
covered by the letter of credit is insufficient. 
Subject to certain conditions, the Indenture does not 
permit the Trustee to purchase the Series C ESOP Notes at 
the option of the Noteholders if the Series C ESOP Notes 
receive the Required Ratings without the benefit of a credit 
enhancement. The Series C ESOP Notes are not likely to 
receive the Required Ratings absent a credit enhancement 
unless Delta's long-term senior unsecured debt is rated at 
least A3 by Moody's and A- by Standard & Poor's. On 
August 14, 1998, Delta's long-term senior unsecured debt 
was rated Baa3 by Moody's and BBB- by Standard & Poor's. 
At June 30, 1998, the annual scheduled maturities of 
long-term debt during the next five fiscal years were as follows: 
Years Ending June 30 
(In Millions) 
1999 
2000 
2001 
2002 
2003 
Amount 
$ 67 
142 
75 
43 
 The Company's debt agreements contain cenain restrictive 
covenants, but do not limit the payment of dividends on 
the Company's capital stock. The terms of the Series B 
ESOP Convertible Preferred Stock limit the Company's 
ability to pay cash dividends on the Company's Common 
Stock (Common Srock) in certain circumstances. 
(See Note 12.) 
Cash payments for interest, net of interest capitalized, 
totaled $152 million in fiscal 1998; $171 million in fiscal 
1997; and $232 million in fiscal 1996. 
7. LEASE OBLIGATIONS 
The Company leases certain aircraft, airport terminal and 
maintenance facilities, ticket offices and other property 
and equipment. Rent expense is generally recorded on a 
straight-line basis over the lease term. Amounts charged 
to rental expense for operating leases were $0.9 billion in 
fiscal 1998, 1997 and 1996. 
At June 30, 1998, the Company's minimum rental 
commitments under capital leases (primarily aircraft) and 
noncancelable operating leases with initial or remaining 
terms of more than one year were as follows: 
Years Ending June 30 Capital Operating 
(In Millions) Leases Leases 
1999 $100 $ 950 
2000 67 950 
2001 57 940 
2002 57 960 
2003 48 960 
After 2003 71 10,360 
Total minimum lease payments $400 $15,120 
Less: Amounts representing interest 88 
Present value of future minimum 
capital lease payments 312 
Less: Current obligations under capital leases 63 
Long-term capital lease obligations $249 
As ofJune 30, 1998, Delta leased 219 aircraft. These 
leases have remaining terms ranging from 18 months to 
19 years and expiration dates ranging from 1999 to 2017. 
Of these leases, 48 are accounted for as capital leases. 
Certain municipalities and airport authorities have 
issued special facility revenue bonds to build or improve 
airport terminal and maintenance facilities that Delta 
leases under operating leases. Under these lease agreements, 
the Company is required to make rental payments suffi- 
cient to pay principal and interest on the bonds as they 
become due. 
8. PURCHASE COMMITMENTS 
Future expenditures for aircraft, engines and engine hush- 
kits on firm order as of August 14, 1998 are estimated to 
be $6.9 billion, as follows: 
Years Ending June 30 
(In Millions) Amount 
1999 $1 ,580 
2000 1,610 
2001 1,570 
2002 300 
2003 370 
After 2003 1,460 
Total $6,890 
The Company has authorized capital expenditures of 
approximately $550 million for fiscal 1999 for improve- 
ment of airport and office facilities, ground equipment and 
other assets. 
The Company expects to finance its aircraft, engine 
and engine hushkit commitments, as well as other authorized 
capital expenditures, using available cash, short-term 
investments and internally generated funds, supplemented 
as necessary by debt financings and proceeds from sale and 
leaseback transactions. 
The Company has entered into code-sharing agreements 
under which it has agreed to purchase seats at established 
prices from specific airlines, subject to certain conditions. 
None of these agreements has material noncancelable terms 
in excess of one year. 
l 9 9 8 A N N U A L R E P O R T 45 
 N TE TO C LI DATED F I NAN I AL S TAT EM E N T continued 
JU E 0 , 1998 , 199 7 AND 1996 
DELTA AIR LI E , IN C . 
9. Co TINGENCIES 
The Company is a defendant in certain legal actions relating 
to alleged employment discrimination practices, antitrust 
matters en ironmental issues and other matters concerning 
the Company's business. Although the ultimate outcome of 
these matters cannot be predicted with certainty, manage- 
ment believes that the resolution of these actions is not likely 
to have a material adverse effect on Delta's consolidated 
financial statements. 
Delta's approximately 8,800 pilots are represented by 
the Air Line Pilots Association, International (ALPA). The 
collective bargaining agreement between the Company and 
ALPA becomes amendable on May 2, 2000. The Company 
and ALPA are currently in negotiations to establish pay rates 
for certain aircraft equipment types. See "Personnel Matters" 
on page 31 of Management's Discussion and Analysis for 
additional information on this subject. 
10. EMPLOYEE BE EFIT PLANS 
The Company sponsors various pension plans, medical plans 
and disability and survivorship plans for employees who 
meet certain service and other requirements. In addition, 
the Company sponsors the Delta Family-Care Savings Plan 
(Savings Plan) in which employees who meet certain service 
and other requirements may elect to participate. 
During fiscal 1997, the Company changed the annual 
measurement date for its employee benefit plan assets 
and liabilities from June 30 to March 31. This change in 
measurement date has been accounted for as a change in 
accounting principle. The change in measurement date had 
no material cumulative effect on employee benefit expense 
for prior years. 
Defined Benefit Pension Plans - The Company's primary 
retirement plans consist of defined benefit pension plans. 
The Company has reserved the right to modify these plans 
to the extent permitted by the Internal Revenue Code and 
the Employee Retirement Income Security Act of 197 4 
(ERISA). The qualified defined benefit plans are funded, 
on a current basis, to meet the minimum funding require- 
ments ofERISA. 
46 D E L T A A I R L I N E S 
The following table sets forth the defined benefit pension 
plans' change in projected benefit obligation for the plan 
years ended June 30, 1998 and 1997: 
(In Millions) 1998 1997 
Projected benefit obligation at 
beginning of year $7,572 $7,430 
ervice cost 207 188 
Interest cost 574 568 
Actuarial (gain) loss 605 (46) 
Benefits paid (648) (568) 
Projected benefit obligation 
at end of year $8,310 $7,572 
The weighted average discount rate and rate of 
increase in future compensation levels used in determining 
the actuarial present value of the projected benefit obliga- 
tions in the above table was 7.0% and 4.3%, respectively, 
at March 31, 1998, and 7.75% and 4.7%, respectively, at 
March 31, 1997. The expected long-term rate of return 
on assets was 10.0% at March 31, 1998 and 1997. 
The following table sets forth the defined benefit pension 
plans' change in the fair value of plan assets for the plan years 
ended June 30, 1998 and 1997: 
(In Millions) 1998 1997 
- - - 
Fair value of plan assets 
at beginning of year $7,512 $7,233 
Actual return on plan assets 2,203 744 
Employer contributions 54 103 
Beneft cs paid (648) (568) 
Fair value of plan assets at end of year $9,121 $7,512 
The accrued pension cost recognized in the Consolidated 
Balance Sheets is computed as follows: 
(In Millions) 1998 1997 
- - 
Funded status $ 811 $ (60) 
Unrecognized nee actuarial gain (1,239) (331) 
Unrecognized transition obligation 61 63 
Unrecognized prior service cost 27 29 
Contributions made between 
April 1 and June 30 11 18 
Accrued pension cost recognized in 
the Consolidated Balance Sheets $ (329) $(281) 
 Net periodic defined benefit pension cost for fiscal 
1998, 1997 and 1996 included the following components: 
(In M illions) 1998 1997 1996 
Service cost $ 207 $ 188 $ 225 
Interest cost 574 568 526 
Expected return on plan assets (685) (653) (591) 
Amortization of prior service cost 2 2 1 
Recognized net actuarial (gain) loss (4) 3 8 
Amortization of net 
transition obligation 2 2 
Nee periodic pension cost $ 96 $ 110 $ 169 
Delta also sponsors several non-qualified pension plans 
which are funded from current assets. The accumulated benefit 
obligation of these plans totaled $259 million at March 31, 1998. 
Defined Contribution Pension Plans: 
Delta Pilots Money Purchase Pension Plan - The Company 
sponsors the Delta Pilots Money Purchase Pension Plan 
(MPPP) to which the Company contributes 5% of covered 
pay for each eligible pilot. The MPPP is a continuation of 
the Delta Pilots Target Benefit Plan and is related to the 
Delta Pilots Retirement Plan through a floor-offset arrange- 
ment whereby the defined benefit pension payable to a pilot 
is subject to reduction by the actuarial equivalent of the 
accumulated account balance in the MPPP. During fiscal 
1998, 1997 and 1996, the Company recognized expense 
of $54 million, $49 million and $2 million, respectively, 
for these plans. 
Employee Stock Ownership Plan - The Company sponsors 
the Savings Plan, a qualified defined contribution pension 
plan under which eligible Delta personnel may contribute 
a portion of their earnings. The Savings Plan includes an 
employee stock ownership plan (ESOP) feature. Subject to 
certain conditions, the Company matches 50% of a partici- 
pant's contributions to the Savings Plan, up to a maximum 
employer contribution of 2% of a participant's earnings. 
The Company's contributions are made quarterly through 
the allocation of Series B ESO P Convertible Preferred 
Stock (ESOP Preferred Stock), Common Stock or cash, 
and are recorded as salaries and related costs in the Com- 
pany's Consolidated Statements of Operations. Delta's 
contributions to the Savings Plan were $49 million in fiscal 
1998 and $45 million in fiscal 1997 and fiscal 1996. 
In connection with the adoption of the ESOP in 1989, 
the Company sold 6,944,450 shares ofESOP Preferred 
Stock to the Savings Plan for approximately $500 million. 
The Company has recorded unearned compensation to 
reflect the value ofESOP Preferred Stock sold to the Savings 
Plan but not yet allocated to participants' accounts. As shares 
of the ESOP Preferred Stock are allocated to participants' 
accounts, unearned compensation is reduced. Dividends 
on unallocated shares ofESOP Preferred Stock are used by 
the ESOP for debt service on the Series C ESOP Notes and 
are not considered dividends for financial reporting purposes. 
Dividends on allocated shares ofESOP Preferred Stock are 
credited to participants and considered dividends for finan- 
cial reporting purposes. For purposes of computing basic 
and diluted income per common share, allocated shares 
of ESOP Preferred Stock are considered outstanding, but 
unallocated shares ofESOP Preferred Stock are not 
considered outstanding. 
Postretirement Benefits Other Than Pensions-Delta's 
medical plans provide medical and dental benefits to sub- 
stantially all retirees and their eligible dependents. Benefits 
are funded from general assets on a current basis. Plan ben- 
efits are subject to co-payments, deductibles and certain 
other limits described in the plans and are reduced once a 
retiree is eligible for Medicare. The Company has reserved 
the right to modify or terminate the medical plans for both 
current and future retirees. 
The following table sets forth the postretirement benefit 
plans' change in accumulated postretirement benefit obligation 
(APBO) for the plan years ended June 30, 1998 and 1997: 
(In Millions) 1998 1997 
APBO at beginning of year $1,565 $1 ,505 
Service cost 33 25 
Interest cost 110 115 
Actuarial gain (17) (35) 
Benefits paid (64) (45) 
APBO at end of year $1,627 $1,565 
I 9 9 8 A N N U A L R E P O R T 47 
 TE T C LI DAT D f INAN IAL TAT E M E N T continued 
J U E 3 0 , 1 99 8 , 199 7 AND 1 9 96 
D E LTA AIR LI E , I 
The accrued po tretirement benefit co t recognized in 
the Consolidated Balance heets is computed as follows: 
(In Millions) 1998 1997 
Funded tatu $(1,627) $(1 ,565) 
Unrecognized net loss 61 76 
Unrecognized prior service co t (388) (426) 
Contributions made between April 1 
and June 30 16 14 
Accrued postretirement benefit cost 
in the Consolidated Balance heets $(1,938) $(1 ,901) 
Net periodic postretirement benefit cost for fiscal 1998, 
1997 and 1996 included the following components: 
(In Millions) 1998 1997 1996 
ervice cost $ 33 $ 25 $ 32 
Interest cost 110 115 118 
Amortization of prior service cost (38) (38) (31) 
Recognized net actuarial (gain) loss (2) 4 
Net periodic postretiremem 
benefit cost $103 $103 $123 
The weighted average discount rate used to estimate the 
APBOwas7.0% at March 31, 1998 and 7.75% at March 31, 
1997. The assumed health care cost trend rate used in mea- 
suring theAPBO was 6.0% in fiscal 1998 and 8.0% in fiscal 
1997, declining gradually to 4.25% by March 31, 2000, and 
remaining level thereafter. A one-percentage-point change 
in the health care cost rate used in measuring the APBO at 
March 31, 1998 would have the following effects: 
(In Millions) 
- - - - - - 
Increase (decrease) in the total 
service and interest cost 
Increase (decrease) in the APBO 
0 ne-Percentage- 
Point Increase 
$ 14 
130 
48 D E L T A A I R L I N E S 
One-Percen rage- 
Point Decrease 
$ (13) 
(117) 
Postemployment Benefits - The ompany provides certain 
welfare benefit to its former or inactive employees after 
employment but before retirement. uch benefits primarily 
include those related to disability and survivorship plans. 
The Company has reserved the right to modify or terminate 
these plans at any time for all participants. 
The ompany's postemployment benefit expense for 
fiscal years 1998, 1997 and 1996 was $7 4 million, $71 mil- 
lion and $78 million, re pectively. The amount funded in 
excess of the liability is included in other noncurrent assets 
in the Company's Consolidated Balance Sheets. Future 
period expenses will vary based on actual claims experience 
and the return on plan assets. 
Gains and losses that occur because actual experience 
differs from that assumed will be amortized over the aver- 
age future service period of employees. Amounts allocable 
to prior service for amendments to retiree and inactive 
insurance plans are amortized in a similar manner. 
The Company continues to evaluate ways to better 
manage employee benefits and control costs. Any changes 
in the plans or revisions to assumptions that affect the 
amount of expected future benefits may have a significant 
effect on the amount of the reported obligation and future 
annual expense. 
11. INCOME PER SHARE 
During fiscal 1998, Delta adopted SFAS 128, which 
establishes new standards for computing, presenting, and 
disclosing income per share data. All prior year income per 
share data have been restated to conform with SFAS 128. 
Application of SFAS 128 did not have a material impact 
on previously reported income per share amounts for the 
fiscal years ended June 30, 1997 and 1996. 
 The following table shows a reconciliation of the 
numerator (net income) and the denominator (average 
shares outstanding) used in computing basic and diluted 
income per share: 
Fiscal Year Ended June 30, 1998 1997 1996 
(In Millions, except per share data) 
Basic: 
Net income $1 ,001 $ 854 $ 156 
Dividends on allocated Series B ESOP 
Convertible Preferred Stock (11) (9) (8) 
Dividends on Series C 
Convertible Preferred Stock (74) 
Income available to common 
shareowners $ 990 $ 845 $ 74 
Weighted average shares outstanding 74.6 74.2 51.8 
Basic income per common share $13.28 $11.39 $1.43 
Diluted: 
Nee Income $1,001 $ 854 $ 156 
Adjustment to net income assuming 
conversion of allocated Series B ESOP 
Convertible Preferred Stock (4) (5) (5) 
Dividends on Series C 
Convertible Preferred Stock (74) 
Income available to common 
shareowners $ 997 $ 849 $ 77 
Weighted average shares outstanding 74.6 74.2 51.8 
Additional shares assuming: 
Exercise of stock options 1.9 .6 .3 
Conversion of allocated Series B ESOP 
Convertible Preferred Stock 2.1 1.9 1.6 
Conversion of Series C 
Convertible Preferred Stock .3 
Weighted average shares 
outstanding as adjusted 78.6 77.0 53.7 
Diluted income per common share $12.68 $11.03 $1.43 
Fiscal 1996 diluted income per common share calcula- 
tion does not assume conversion of the 3.23% Convertible 
Subordinated Notes due June 15, 2003 and the Series C 
Convertible Preferred Stock, because to do so would have 
been antidilutive. 
12. COMMON AND PREFERRED STOCK 
During fiscal 1998, the Company issued 4,160,501 shares 
of Common Stock under its broad-based employee stock 
option plans, and a total of 477,541 shares of Common 
Stock under its 1989 Stock Incentive and Dividend Reinvest- 
ment and Stock Purchase Plans. In addition, the Company 
distributed a total of 49,541 shares of Common Stock from 
treasury under its 1989 Stock Incentive Plan. Also during 
fiscal 1998, the Company repurchased 3,158,373 shares of 
Common Stock. 
At June 30, 1998, 20,539,449 shares of Common Stock 
were reserved for issuance under the Company's broad-based 
employee stock option plans; 7,663,763 shares of Common 
Stock were reserved for issuance under the 1989 Stock 
Incentive Plan; 5,664,421 shares of Common Stock were 
reserved for conversion of the ESOP Preferred Stock; and 
248,215 shares of Common Stock were reserved for issuance 
under the Non-Employee Directors' Stock Plan. In addition, 
1,500,000 shares of preferred stock were reserved for issuance 
under the Shareowner Rights Plan. 
The Shareowner Rights Plan is designed to enhance 
the ability of the Board of Directors to protect shareowners 
against attempts to acquire Delta that do not offer an adequate 
price to all shareowners, or that are otherwise not in the best 
interest of the Company and its shareowners. Under this 
plan, each outstanding share of Common Stock is accom- 
panied by a preferred stock purchase right which entitles the 
holder co purchase from the Company 1/100 of a share of 
Series D Junior Participating Preferred Stock for $300, sub- 
ject to adjustment in certain circumstances (Purchase Price). 
The rights become exercisable only after a person or group 
acquires beneficial ownership of 15% or more of the Com- 
mon Stock or commences a tender or exchange offer that 
would result in such person or group beneficially owning 
15% or more of the Common Stock. The rights expire on 
November 4, 2006, and may be redeemed by Delta for $0.01 
per right until 10 business days following the announcement 
that a person or group beneficially owns 15% or more of the 
Common Stock. Subject to certain conditions, if a person or 
group becomes the beneficial owner of 15% or more of the 
Common Stock, each right will entitle its holder (other than 
certain acquiring persons) to purchase, for the Purchase Price, 
Common Stock having a market value of twice the Purchase 
Price. In addition, subject to certain conditions, if Delta is 
involved in a merger or certain other business combination 
I 9 9 8 A N N U A L R E P O R T 49 
 N TE To Co 0 LI DATE D F I NAN I AL S TAT EM ENT S continued 
JU E 0 , 1998 , 199 7 AND 1996 
DELTA IR LINE , IN 
transactions or the Company sells or otherwise transfers 
more than 50% of its asset or earning power, each right 
will entitle its holder to purchase, for the Purchase Price, 
Common tock of the other party having a market value 
of twice the Purchase Price. 
Each share ofE OP Preferred Stock has a stated value 
of 72; bears an annual cumulative cash dividend of 6% or 
4.32; is convertible into 0.8578 share of Common tock 
(a conversion price of $83.94) subject to adjustment in cer- 
tain circumstances; has a liquidation preference of $72, plus 
any accrued and unpaid dividends; generally votes together 
as a single class with the Common tock on matters upon 
which the Common Stock is entitled to vote; and has one 
vote, subject to adjustment in certain circumstances. The 
ESOP Preferred tock is redeemable at Delta's option at 
specified redemption prices payable, at Delta's election, in 
cash or Common Stock. If full cumulative dividends on the 
ESOP Preferred Stock have not been paid when due, Delta 
may not pay cash dividends on the Common Stock. 
13. STOCK OPTIONS AND AWARDS 
Under its 1989 Stock Incentive Plan and a predecessor 
plan, the Company has granted non-qualified stock options 
and, prior to fiscal 1993, tandem stock appreciation rights 
(SARs) to officers and other key employees. The exercise 
price for all stock options, and the base price upon which 
the SARs are measured, is the fair market value of the Com- 
mon Stock on the date of grant. Awards exercised as SARs 
are payable in a combination of cash and Common Stock. 
The Company recognized compensation expense 
(included in salary and related costs) related to SARs in 
fiscal 1998, 1997 and 1996 of $8 million, $3 million 
and $14 million, respectively. Stock options are generally 
exercisable beginning one year, and ending ten years, after 
their grant date. 
On October 24, 1996, the Company's shareowners 
approved two plans providing for the issuance of non-qualified 
stock options to substantially all of Delta's non-officer 
personnel to purchase a total of24.7 million shares of 
Common tock. One plan is for eligible Delta personnel 
who are not pilots (Nonpilot Plan); the other plan covers 
the Company's eligible pilots (Pilot Plan). 
The Nonpilot and Pilot Plans involve non-qualified 
stock options to purchase 14.7 million and 10 million 
shares of Common Stock, respectively. The plans provide 
for grants in three annual installments at an exercise price 
equal to the opening price of the Common Stock on the 
New York Stock Exchange on the grant date. Stock options 
awarded under these plans are generally exercisable begin- 
ning one year and ending ten years after their grant dates, 
and are not transferable other than upon the death of the 
person granted the stock options. On October 30, 1997 
and 1996, Delta granted eligible personnel non-qualified 
stock options to purchase 8.3 million and 8.2 million 
shares of Common Stock, respectively, at exercise prices 
of $98 per share and $69 per share, respectively. The third 
grant date under the Nonpilot and Pilot Plans is scheduled 
to occur on October 30, 1998. 
Transactions involving stock options and SARs during fiscal 1998, 1997 and 1996 were as follows: 
Fiscal 1998 Fiscal 1997 Fiscal 1996 
Weighted Weighted Weighted 
Average Average Average 
Exercise Exercise Exercise 
Srock Options Shares Price Shares Price Shares Price 
(000) (000) (000) 
Outstanding at beginning of fiscal year 9,901 $ 69 2,332 $65 3,386 $63 
Granted 9,849 100 8,932 70 644 71 
Exercised (4,659) 69 (1,279) 67 (1,654) 63 
Forfeited (88) 92 (84) 75 (44) 65 
Outstanding at end of fiscal year 15,003 89 9,901 69 2,332 65 
Srock options exercisable at fiscal year end 5,211 $ 70 1,049 $63 1,698 $63 
50 D E L T A A I R L I N E S 
 The following table summarizes information about stock options outstanding at June 30, 1998: 
Stock Options Outstanding Stock Options Exercisable 
Range of Number Weighted Weighted Number Weighted 
Exercise Outstanding at Average Average Exercisable at Average 
Prices June 30, 1998 Remaining Life Exercise Price June 30, 1998 Exercise Price 
(000) 
$52-$68 276 
$69-$83 4,935 
$84-$125 9,792 
SFAS 123 requires proforma information regarding net 
income and income per share, determined as if the Company 
accounted for its employee stock option plans under the fair 
value method ofSFAS 123. The fair value of stock options 
granted in fiscal 1998, 1997 and 1996 was derived using the 
Black-Scholes stock option pricing model. The assumptions 
and the weighted average fair values were as follows: 
Stock Options 
Granted in Fiscal Year 
Assumptions 1998 1997 1996 
Risk-free interest rate 5.8% 6.0% 5.4% 
Average expected life of 
stock options (Years) 3.3 2.7 5.1 
Expected volatility of 
Common Stock 25.3% 26.4% 26.5% 
Expected annual dividends on 
Common Stock $0.20 $0.20 $0.20 
Weighted average fair value 
of stock options $ 26 $ 17 $ 24 
Pro Forma Net Income and Income per Common Share: 
Fiscal Year Ended June 30, June 30, June 30, 
(In M illions): 1998 1997 1996 
Net income: 
As reported $1,001 $ 854 $ 156 
Proforma 875 791 152 
Basic income per common share: 
As reported $13.28 $11.39 $1.43 
Proforma 11.59 10.53* 1.36* 
Diluted income per 
common share: 
As reported $12.68 $11.03 $1.43 
Proforma 11.07 10.21 * 1.35* 
*Restated in accordance with SFAS 128. See Note 11. 
(Years) (000) 
5 $ 56 276 $56 
8 71 4,935 71 
9 100 
Under SFAS 123, stock options granted prior to fiscal 
year 1996 are not required to be included as compensation 
in determining pro forma net income. Therefore, the pro 
forma effects on net income and income per common 
share for fiscal 1998 may not be representative of the pro 
forma effects SFAS 123 may have in future years. 
14. STOCK REPURCHASE AUTHORIZATION 
In April 1996, Delta's Board of Directors authorized the 
Company to repurchase up to 24.7 million shares of 
Common Stock and Common Stock equivalents. Under 
this authorization, the Company could repurchase up to 
6.2 million of these shares before October 30, 1997 - the 
date the initial stock option grants under the broad-based 
employee stock option plans became exercisable - and may 
purchase the remaining shares as Delta personnel exercise 
their stock options under those plans. (See Note 13.) The 
Company repurchased 3,079,000, 5,378,700 and 821,300 
shares of Common Stock for $345 million, $379 million 
and $66 million during fiscal 1998, 1997 and 1996, 
respectively, under this authorization. 
In July 1998, Delta's Board of Directors authorized 
the Company to repurchase Common Stock and Common 
Stock equivalents for an aggregate purchase price of up to 
$750 million from time to time through December 31, 1999. 
This authorization is in addition to the Company's stock 
repurchase plan discussed in the preceding paragraph. 
Repurchases under both of the above authorizations 
are subject to market conditions and may be made on the 
open market or in privately negotiated transactions. 
1 998 ANNUA L R E PORT 51 
 N TE T C N LID TED FINAN IAL TATEM ENT continued 
J U E 3 0 , 1998 , 1 997 A D 1996 
DE LT AIR LI E , IN 
15. RE TRU TURI G D O THER 
No -RECURRI G CHARGE 
During fiscal 1997 and 1996 the Company recorded 
pretax restructuring and ocher non-recurring charges of 
52 million and 829 million, respectively. These charges 
were due to the writedown of Delta's L-1011 fleet in 
accordance with FA 121; employee early retirement 
programs lease termination costs related to abandoned 
facilities and discontinued routes; and co cs related to 
the realignment of the Company's transatlantic and 
European operations. 
The Company made payments of $51 million 
related to these charges during fiscal 1998. The remain- 
ing liability related co the charges was $36 million as 
ofJune 30, 1998. 
Actual costs incurred, realization on the sales of excess 
inventories, and costs associated with lease terminations 
17. Q UARTERLY FI ANCIAL D ATA (U AUDITED) 
and abandoned facilities may vary from current estimates. 
The appropriate accrued liability will be adjusted upon 
completion of these activities. 
16. INT RNATIONAL REVENUES 
Delta provides scheduled air transportation for passengers, 
freight and mail over a network of routes throughout the 
United rates and abroad. Delta's operating revenues by 
international region are as follows: 
(In Millions) 1998 1997 1996 
Entity: 
Atlantic 2,092 2,024 1,909 
Pacific 304 325 342 
Latin America 245 218 187 
2,641 2,567 2,438 
The following is a summary of the unaudited quarterly results of operations for fiscal 1998 and 1997 (in millions, except per 
share data): 
Fiscal 1998 
Operating revenues 
Operating income 
Nee income 
Basic income per common share 
Diluted income per common share 
Fiscal 1997 
Operating revenues 
Operating income 
Net income 
Basic income per common share 
Diluted income per common share __ __ _ _ _ __ _ 
*Restated to conform with SPAS 128. See Note 11. 
The sum of the quarterly income per common share 
does not equal the fiscal income per common share due to 
changes in average share calculations. 
52 D E LT A A I R L I N E S 
Three Months Ended 
Sepe. 30 Dec. 31 Mar. 31 June 30 
$3,553 $3,434 $3,390 $3,761 
$ 431 $ 332 $ 336 $ 594 
$ 254 $ 190 $ 195 $ 362 
$ 3.41 * $ 2.52 $ 2.57 $ 4.77 
$ 3.26* $ 2.40 $ 2.45 $ 4.52 
$3,433 $3,198 $3,421 $3,542 
$ 439 $ 227 $ 346 $ 519 
$ 238 $ 125 $ 190 $ 301 
$ 3.10* $ 1.66* $ 2.56* $ 4.06* 
$ 2.98* $ 1.63* $ 2.47* $ 3.90* 
Operating expenses for the March 1997 quarter include 
$52 million pretax restructuring and ocher non-recurring 
charges related to the realignment of the Company's 
transatlantic and European operations. (See Note 15.) 
 REPORT OF INDEPENDEN T PUBLI C A CC OUNTAN T S 
DELTA AIR LINES , IN C. 
To the Shareowners and 
Board of Directors of Delta Air Lines, Inc.: 
We have audited the accompanying consolidated balance 
sheets of Delta Air Lines, Inc. (a Delaware corporation) and 
subsidiaries as ofJune 30, 1998 and 1997, and the related 
consolidated statements of operations, cash flows and share- 
owners' equity for each of the three years in the period ended 
June 30, 1998. These financial statements are the responsi- 
bility of the Company's management. Our responsibility is 
to express an opinion on these financial statements based on 
our audits. 
We conducted our audits in accordance with generally 
accepted auditing standards. Those standards require that we 
plan and perform the audit to obtain reasonable assurance 
about whether the financial statements are free of material 
misstatement. An audit includes examining, on a test basis, 
evidence supporting the amounts and disclosures in the 
financial statements. An audit also includes assessing the 
accounting principles used and significant estimates made 
R E POR T OF M ANAGEMENT 
D E LTA AIR LI NES , I NC . 
The integrity and objectivity of the information presented in 
this Annual Report are the responsibility of Delta manage- 
ment. The financial statements contained in this report have 
been audited by Arthur Andersen LLP, independent public 
accountants, whose report appears on this page. 
Delta maintains a system of internal financial controls 
which are independently assessed on an ongoing basis through 
a program of internal audits. These controls include the selec- 
tion and training of the Company's managers, organizational 
arrangements that provide a division of responsibilities, 
and communication programs explaining the Company's 
policies and standards. We believe that this system provides 
reasonable assurance that transactions are executed in 
accordance with management's authorization; that transac- 
tions are appropriately recorded to permit preparation of 
financial statements that, in all material respects, are pre- 
sented in conformity with generally accepted accounting 
by management, as well as evaluating the overall financial 
statement presentation. We believe that our audits provide a 
reasonable basis for our opinion. 
In our opinion, the financial statements referred to 
above present fairly, in all material respects, the consolidated 
financial position of Delta Air Lines, Inc. and subsidiaries as 
ofJune 30, 1998 and 1997, and the consolidated results of 
their operations and their cash flows for each of the three 
years in the period ended June 30, 1998, in conformity with 
generally accepted accounting principles. 
~ ~ L L P 
Atlanta, Georgia 
August 14, 1998 
principles; and that assets are properly accounted for and 
safeguarded against loss from unauthorized use. 
The Board of Directors pursues its responsibilities for 
these financial statements through its Audit Committee, 
which consists solely of directors who are neither officers nor 
employees of the Company. The Audit Committee meets 
periodically with the independent public accountants, the 
internal auditors and representatives of management to dis- 
cuss internal accounting control, auditing and financial 
reporting matters. 
Executive Vi'ce President 
and Chief Financial Officer 
Leo F. Mullin 
President and 
Chief Executive Officer 
I 9 9 8 A N N U A L R E P O RT 53 
 CONSOLIDATED SUMMARY OF OPERATIONS 
DELTA AIR LINES, INC. 
For the fiscal years ended June 30 
(In Millions, Except Per Share Data) 
Operating revenues 
Operating expenses 
Operating income (loss) 
Interest expense, net 
Gain (loss) on disposition of flight equipment 
Miscellaneous income, net6 
Income (loss) before income taxes 
Income tax benefit (provision) 
Amortization of investment tax credits 
Net income (loss) 
Preferred stock dividends 
Net income (loss) attributable to common shareowners 
Net income (loss) per common share: 7 
Basic 
Diluted 
Dividends declared on Common Stock 
Dividends declared per common share 
1998 
$14,138 
12,445 
1,693 
(148) 
103 
1,648 
(647) 
1,001 
(11) 
$ 990 
$ 13.28 
$ 12.68 
$ 15 
$ 0.20 
OTHER FIN ANCIAL AND STATISTICAL DATA 
For the fiscal years ended June 30 
(Financial Data In Millions) 
Total assets 
Long-term debt and capital leases (excluding current maturities) 
Shareowners' equity 
Shares of Common Stock outstanding at year end 
Revenue passengers enplaned (ThoU5ands) 
Available seat miles (Millions) 
Revenue passenger miles (Millions) 
Operating revenue per available seat mile 
Passenger mile yield 
Operating cost per available seat mile 
Passenger load factor 
Breakeven passenger load factor 
Available ton miles (Millions) 
Revenue ton miles (Millions) 
Operating cost per available ton mile 
1998 
$14,603 
$ 1,783 
$ 4,023 
75,225,197 
104,148 
140,149 
101,136 
10.09 
12.83 
8.88 
72.2% 
62.7% 
19,890 
11,859 
62.57 
19971 
$13,594 
12,063 
1,531 
(174) 
58 
1,415 
(561) 
854 
(9) 
$ 845 
$ 11.39 
$ 11.03 
$ 15 
$ 0.20 
199?1 
$12,741 
$ 1,797 
$ 3,007 
73,695,987 
101,147 
136,821 
97,758 
9.94 
12.79 
8.82 
71.4% 
62.7% 
18,984 
11,308 
63.54 
19962 
$12,455 
11,992 
463 
(243) 
2 
54 
276 
(120) 
$ 
156 
(82) 
74 
$ 1.43 
$ 1.43 
$ 10 
$ 0.20 
19962 
$12,226 
$ 2,175 
$ 2,540 
67,778,106 
91,341 
130,751 
88,673 
9.53 
13.10 
9.17 
67.8% 
65.1% 
18,084 
10,235 
66.31  
1 Summary of operations and other financial and statistical data include $52 million in pretax restructuring and other non-recurring charges ($0.43 basic and 
$0.42 diluted after-tax income per common share). 
19953 
$12,194 
11,533 
661 
(262) 
95 
494 
(200) 
294 
(88) 
$ 206 
$ 4.07 
$ 4.01 
$ 10 
$ 0.20 
19953 
$12,143 
$ 3,121 
$ 1,827 
50,816,010 
88,893 
130,645 
86,417 
9.33 
13.10 
8.83 
66.2% 
62.3% 
18,150 
10,142 
63.55 
2 Summary of operations and other financial and statistical data include $829 million in pretax restructuring charges and other non-recurring charges ($9. 77 after-tax per common share). 
3 Summary of operations and other financial and statistical data exclude$ 114 million after-tax cumulative effect of change in accounting standards ($2.25 basic and 
$1. 43 diluted income per common share). 
~ Summary of operations and other financial and statistical data include $526 million in pretax restructuring charges ($659 after-tax per common share). 
5 Summary of operations and other financial and statistical data include $82 million pretax restructuring charge($ 1. 05 after-tax per common share). 
Summary of operations exclude $587 million after-tax cumulative effect of changes in accounting standards ($11. 78 after-tax per common share). 
6 Includes interest income. 
1 Income per share data far fiscal years 1988-1997 have been restated in accordance with SPAS 128. See Note 11 of Notes to Consolidated Financial Statements. 
54 D E L T A A I R L I N E S 
j 
i 
19944 19935 
$12,077 $11,657 
12,524 12,232 
(447) (575) 
(271) (177) 
2 65 
56 36 
(660) (651) 
250 233 
1 3 
(409) (415) 
(110) (110) 
$ (519) $ (525) 
$ (10.32) $ (10.54) 
$ (10.32) $ (10.54) 
$ 10 $ 35 
$ 0.20 $ 0.70 
19944 19935 
$11 ,896 $11,871 
$ 3,228 $ 3,716 
$ 1,467 $ 1,913 
50,453,272 50,063,841 
87,399 85,085 
131,906 132,282 
85,268 82,406 
9.16 8.81 
13.23 13.23 
9.49 9.25 
64.6% 62.3% 
67.2% 65.6% 
18,302 18,182 
9,911 9,503 
68.43 67.27 
1992 1991 1990 1989 1988 
$10,837 $9,171 $8,583 $8,089 $6,915 
11,512 9,621 8,163 7,411 6,418 
(675) (450) 420 678 497 
(151) (97) (27) (39) (65) 
35 17 18 17 (I) 
5 30 57 55 25 
(786) (500) 468 711 456 
271 163 (187) (279) (181) 
9 13 22 29 32 
(506) (324) 303 461 307 
(19) (19) (18) 
$ (525) $ (343) $ 285 $ 461 $ 307 
$ (10.60) $ (7.73) $ 5.79 $ 9.37 $ 6.30 
$ (10.60) $ (7.73) $ 5.28 $ 9.37 $ 6.30 
$ 59 $ 54 $ 85 $ 59 $ 59 
$ 1.20 $ 1.20 $ 1.70 $ 1.20 $ 1.20 
1992 1991 1990 1989 1988 
$10,162 $8,411 $7,227 $6,484 $5,748 
$ 2,833 $2,059 $1 ,315 $ 703 $ 729 
$ 1,894 $2,457 $2,596 $2,620 $2,209 
49,699,098 49,401,779 46,086,110 49,265,884 49,101,271 
77,038 69,127 67,240 64,242 58,565 
123,102 104,328 96,463 90,742 85,834 
72,693 62,086 58,987 55,904 49,009 
8.80 8.79 8.90 8.91  8.06 
13.91 13.80 13.63 13.56 13.15 
9.35 9.22 8.46 8.17 7.48 
59.1% 59.5% 61.2% 61.6% 57. 1% 
63.0% 62.6% 58.0% 56.1% 52.7% 
16,625 13,825 12,500 11,725 11,250 
8,361 7,104 6,694 6,338 5,557 
69.24 69.59 65.30 63.21 57.05 
I 9 9 8 A N N U A L R E P O RT 55 
 H RE ER INF RM TI N 
DELTA AIR LINE , IN 
TRAN FER 
MM 
Regi tered shareowner inquiries regarding tock tran fers, addres 
changes, lo t tock certificates, dividend payments or account 
con olidation should be directed to: 
Fir t Chicago Trust Company of ew York 
P. 0 . Box 2500 
Jersey City, ew Jer ey 07303-2500 
Telephone (201) 324-1225 
(http://www.fctc.com) 
DMDE DREI TME T D TO KPUR HA EPLAN 
Registered owners of Common tock may purchase additional shares 
of such stock through automatic dividend reinvestment or cash con- 
tributions under the Company's Dividend Reinvestment and tock 
Purchase Plan. Inquiries, notices, requests and other communica- 
tions regarding participation in the plan should be directed to: 
First Chicago Trust Company of ew York 
P. 0 . Box 2598 
Jersey City, ew Jersey 07303-2598 
Telephone (201) 324-1225 
I DEPE DE T PUBLI ACCO 
Arthur Andersen LLP 
133 Peachtree treet, .E. 
Atlanta, Georgia 30303 
UALMEETI G 
The Annual Meeting of Shareowners will be held on Thursday, 
October 22, 1998, at 9:00 a.m., local time, at The Waldorf=Astoria, 
301 Park Avenue, ew York, New York 10022. 
AVAJLABILITYOF FORM 10-K AND 
OTHER FI ANCIAL I FORMATION 
A copy of the Company's Annual Report on Form 10-K for the 
fiscal year ended June 30, 1998 will be provided without charge upon 
written request. Requests for other financial documents may also be 
directed to: 
Delea Air Lines, Inc. 
Investor Relations, Department 829 
P. 0. Box 20706 
Atlanta, Georgia 30320-6001 
Telephone (404) 715-2170 
Company documents filed electronically with che U.S. Securities 
and Exchange Commission (SEC) can also be found on che SEC's 
Web Site (http://www.sec.gov). A copy of chis Annual Report can 
be found on Delta's Web Site (http://www.delca-air.com). 
Telephone inquiries related to financial information, other than 
requests for financial documents, may be directed to Investor 
Relations at ( 404) 715-6679. 
56 D E LT A A I R L I N E S 
OMM N T K 
Listed on the New York Stock Exchange under the ticker symbol DAL. 
NUMBER OF HARE WNER 
As of August 1, 1998, there were 21,672 registered owners of 
ommon Stock. 
MARKET PRl E AND DIVJDEND 
losing Price of 
ommon Srock on 
Fiscal Year 1998 New York rock Exchange 
Quarter Ended: High Low 
September 30 $1071/s $ 82 
December 31 120 3/s 94 5 
/s 
March 31 123 1/s 110 1/s 
June 30 129 3 
/s 110  
Fiscal Year 1997 
Quarter Ended: High Low 
eptember 30 $ 821/s $ 661/s 
December 31 77 67 
March 31 87 69 
June 30 981/s 82 
AVAJLABILITY OF EQUAL 
EMPLOYMENT OPPORTUNITY REPORT 
Cash Dividends Per 
Common Share 
$0.05 
0.05 
0.05 
0.05 
$0.05 
0.05 
0.05 
0.05 
A copy of the Company's Equal Employment Opportunity Report 
is available without charge upon written request. Requests may be 
directed to: 
Delta Air Lines, Inc. 
Equal Opportunity, Department 955 
P.O. Box 20706 
Atlanta, Georgia 30320-6001 
Photography by Delta Photography Department 
Designed and produced by Corporate Reports Inc.I Atlanta 
@ Printed on recycled paper 
 DELTA AIR LINES AT-A-GLANCE 
GLOBAL NETWORK* 
Delea flies to 194 cities in 32 countries, carrying 
more passengers than any other carrier in the world. 
Delta's Atlanta Worldport is the largest single carrier 
hub in the world, with 622 daily departures to 123 
nonstop destinations. Approximately 80 percent of 
Delta's operating revenue is from domestic operations, 
and 20 percent is from the international system. 
NORTH AMERICAN NETWORK* 
Delea is the largest U.S. airline measured by aircraft 
departures and passengers enplaned and the third- 
largest U.S. airline measured by operating revenues 
and revenue passenger miles flown. Delta's North 
American flight operations provides scheduled ser- 
vice to 148 cities in the U.S., Puerto Rico and the 
U.S. Virgin Islands and 10 cities in Canada, Bermuda, 
Mexico, the Bahamas and the Caribbean. Mexico is 
also served through eight cities on a code-share basis. 
Delta's domestic route service is supplemented by the 
Delea Connection carriers, which include Atlantic 
Southeast Airlines, Business Express Airlines, Comair, 
SkyWest Airlines and Trans States Airlines. 
INTERNATIONAL NETWORK* 
Delta is the leading transatlantic airline among U.S. 
carriers, with the most departures, nonstop destinations 
and passengers. Delea provides scheduled passenger 
service to 36 cities in 26 countries throughout Europe, 
Africa, Asia and Latin America. Including flights 
operated on a code-sharing basis, Delta's international 
network serves 95 cities in 51 countries. 
*Service as of August 1, 1998. 
DELTA EXPRESS 
Delea began operating Delta Express, a low-fare service 
targeting the Florida leisure traveler within the Delta 
system, on October 1, 1996. Delta Express initiated 
service with a dedicated fleet of 12 Boeing 737-200 
jet aircraft and 62 daily departures to 13 cities. By 
December 1, 1998, Delta Express will operate 37 air- 
craft to 22 cities and offer 170 daily departures. The 
route system connects the Northeast and Midwest 
with Orlando and other Florida destinations. 
DELTA SHUTTLE 
The Delta Shuttle is a specialized, high-frequency 
product targeted coward the business customer. A 
dedicated fleet of 14 Boeing 727 aircraft provides 
64 daily departures on the half hour. Service is pro- 
vided between the Marine Air Terminal at New York's 
LaGuardia Airport to both Boston's Logan Inter- 
national Airport and Washington, D.C.'s Ronald 
Reagan National Airport. Delea Shuttle customers 
receive guaranteed seating and are offered compli- 
mentary juices, beer and wine. With an on-time 
departure rate exceeding 97 percent for fiscal 1998, 
the Delta Shuttle provides excellent service and reli- 
ability for travelers in the Northeast Corridor. In 
addition, Shuttle passengers have access to the Delea 
Water Shuttle, which offers quick access between 
LaGuardia Airport and downtown Manhattan. 
DELTA AIR CARGO 
Delea, the Delta Shuttle, Delea Express and the Delta 
Connection carriers offer over 4,600 flights daily to 
cities all over the world, and every flight has the ability 
to carry cargo. In addition, Delta Air Cargo and Swissair 
Cargo launched a worldwide alliance chat creates one 
of the largest air cargo networks over the North Atlantic. 
The combined Delta and Swissair Cargo networks 
provide access to a global network. Delea services 
include expedited small package shipping (Delta 
DashTM 
) and time-definite heavy weight shipments. 
 ~ .Delta Air Lines 
P. . Bo , 070 Atlanta, or0 ia 0 20-6001 U .. A. 
http:// .delta-air. om