Delta Air Lines Reports 2008 Financial Results

Capacity reductions, merger benefits, fuel savings and solid liquidity position the company for a profitable 2009


ATLANTA, Jan. 27, 2009 (GLOBE NEWSWIRE) -- Delta Air Lines (NYSE:DAL) today reported financial results for the quarter and year ended Dec. 31, 2008. Key points include:



 * Delta's net loss for the December 2008 quarter was $340 million, or
   $0.50 per diluted share, excluding special items described below,
   and the impact of out-of-period fuel hedges.(1) Results include $0.12
   per diluted share from the negative non-cash impact of purchase
   accounting.
 * Delta would have reported a $167 million net profit excluding
   special items in the December 2008 quarter, if fuel had been
   purchased at market prices.
 * Delta's reported net loss for the December 2008 quarter was $1.4
   billion, including an over $900 million charge related to 
   broad-based employee equity awards, and a $91 million loss on 
   out-of-period fuel hedges.
 * Delta completed its merger with Northwest on Oct. 29, 2008,
   creating the world's largest airline.
 * As of December 31, 2008, Delta had $6.1 billion in total liquidity
   and cash collateral posted with hedge counterparties.

Delta's 2008 net loss was $503 million, or $1.08 per diluted share, excluding (1) special items that primarily consist of an over $900 million non-cash charge related to employee equity awards that were issued or vested in connection with the merger and $7.3 billion in non-cash goodwill and other intangible asset impairment charges reported earlier this year, and (2) a $91 million loss on out-of-period fuel hedges. Delta's reported 2008 net loss was $8.9 billion, or $19.08 per diluted share.

Unless otherwise indicated, Delta's financial results for the December quarter and full year 2008 are presented on a GAAP basis, which include results for Northwest Airlines following the completion of the merger for the period Oct. 30, 2008 through Dec. 31, 2008.(2) As a result of the merger, Delta's financial results include approximately $80 million in higher expenses from the non-cash impact of purchase accounting, or $0.12 per diluted share for the December 2008 quarter.

"I want to thank my 85,000 Delta colleagues for their outstanding achievements in 2008 - a year where we not only faced the severe challenges brought on by over $2 billion in increased fuel costs and the onset of a global recession, but also closed our merger with Northwest and began a smooth integration process," said Richard Anderson, Delta's chief executive officer. "Despite the difficult economic environment, we expect to be solidly profitable in 2009 driven by lower fuel costs, capacity discipline, and merger synergies. Delta people have a great track record for achieving their goals, and I am confident that 2009 will be another successful year."

Merger with Northwest

Delta completed its merger with Northwest during the fourth quarter, creating the world's largest airline, and expects the merger to generate $500 million in synergies in 2009 and $2 billion in annual run-rate synergies by 2012. As a result of significant integration planning activities that began prior to the merger, the company is on track in its integration efforts and achieved many milestones during the quarter, including:



 * Delta placed its code on over 90% of Northwest routes, creating
   thousands of additional connecting opportunities for its customers;
 * Delta extended its exclusive co-brand credit card partnership with
   American Express through 2015, which provided the company over $1
   billion in immediate liquidity and is expected to provide an
   additional $1 billion in contract enhancements over the next two
   years;
 * Delta and Northwest pilots, represented by the Air Line Pilots
   Association, achieved a single seniority list for the combined
   group. More than 25 percent of Delta's total workforce has now
   resolved seniority integration, including pilots, flight
   dispatchers, meteorologists, aircraft maintenance technicians and
   other TechOps employees;
 * The National Mediation Board ruled that Delta and Northwest now
   constitute a single transportation system for representation
   purposes under the Railway Labor Act. This is an important
   milestone toward resolving representation issues, which will allow
   alignment of pay, benefits and work rules for all employees of the
   new Delta;
 * Elite members of both airlines' loyalty programs gained immediate
   complimentary upgrade reciprocity; and
 * Delta completed the re-branding of approximately 50 of the airports
   in which Northwest operates and began a program to paint all
   Northwest mainline aircraft in the Delta livery by the end of 2010.

Revenue Environment

Delta's GAAP operating revenue grew to $6.7 billion in the December 2008 quarter as a result of its merger with Northwest Airlines. The company believes it is more meaningful to compare results year-over-year on a combined basis, shown below, which includes three full months in the December 2007 and 2008 quarters for Northwest. On this basis, operating revenue was flat year-over-year on a 4% decline in capacity.



                        GAAP(3)                Combined(4)
                   ---------------           ---------------
 (in millions)                        Incr                      Incr
                    4Q08     4Q07    (Decr)   4Q08     4Q07    (Decr)
                   ---------------   ------  ---------------   ------

 Passenger         $5,735   $4,067     41%   $6,657   $6,711     (1%)
 Cargo                230      132     74%      285      374    (24%)
 Other, net           748      484     55%      826      705     17%
                   ------   ------           ------   ------
 Total Operating
  Revenue          $6,713   $4,683     43%   $7,768   $7,790      0%
                   ------   ------           ------   ------

On a combined basis:



 * Passenger revenue fell 1%, or $54 million, compared to the prior
   year period due to a 4% decline in capacity, partially offset by a
   3% increase in unit revenue. These results reflect the weakening of
   the revenue environment during the quarter caused by the global
   economic recession;
 * Cargo revenue declined 24%, or $89 million, due primarily to
   proactive reductions of Northwest freighter capacity; and
 * Other, net revenue grew 17%, or $121 million, primarily due to
   increased revenue from baggage fees.

Based on ATA data for 2008, Delta and Northwest each achieved a revenue premium to the industry. The consolidated length of haul adjusted passenger unit revenue (PRASM) was 101% and 103%, respectively, of industry average PRASM (excluding Delta and Northwest) for the year. During the December 2008 quarter, 40% of Delta and Northwest combined capacity was deployed on international routes and 60% on domestic routes.

Comparisons of combined revenue-related statistics are as follows:



                                                 Increase
                                       (Decrease) 4Q08 versus 4Q07
                                   ----------------------------------
                    Combined(4)     Change   Unit
                      4Q08 ($M)      YOY    Revenue  Yield   Capacity
                     ----------    ----------------------------------
 Passenger Revenue
  Domestic(5)            $3,059     (8.4%)   4.1%    (0.5%)  (13.4%)
  Atlantic                1,263     10.5%   (2.8%)    1.3%    13.7%
  Latin America             310      4.8%    5.5%    11.8%    (0.7%)
  Pacific                   637      9.6%    4.6%     4.4%     4.8%
                     ----------    ----------------------------------
  Total mainline         $5,269     (1.7%)   2.7%     1.4%    (4.2%)
  Regional                1,388      2.6%    3.7%     3.1%    (1.0%)
                     ----------    ----------------------------------
  Consolidated           $6,657     (0.8%)   3.1%     2.0%    (3.8%)

"Delta's proactive decision to reduce domestic capacity during 2008 mitigated the impact of the decline in demand we saw over the course of the fourth quarter. We expect the worldwide economy to be difficult throughout 2009; however, if fuel prices remain at current levels, we believe the benefit of lower fuel prices will more than offset the revenue decline," said Edward Bastian, Delta's president. "Delta has the tools required to manage through these tough economic times - with the broadest, most diverse network in the industry; an estimated $2 billion in annual merger synergies to be obtained; best-in-class costs; a solid liquidity balance; unmatched fleet flexibility; and the discipline and drive of the new Delta team."

Capacity Discipline

In 2008, Delta demonstrated its firm commitment to capacity discipline and its ability to quickly reduce fixed and variable costs associated with reduced capacity. Delta led the industry in early 2008 in responding to high fuel prices and the weakening demand environment, resulting in a reduction in domestic capacity of 11% in the last six months of 2008. Delta's flexible and cost efficient fleet is a unique tool that allows the company to reduce capacity quickly. In 2009, the company plans to remove 40-50 mainline aircraft from the fleet as it eliminates the fixed costs associated with its 6 - 8% system capacity reduction. In addition, in January 2009, Delta offered its second voluntary workforce reduction program in 12 months to more closely align its staffing with lower capacity levels. Delta will continue to monitor the demand environment and has full flexibility to further reduce capacity if warranted.

Cost Discipline

Delta's GAAP operating expenses increased to $7.8 billion in the December 2008 quarter primarily due to the company's merger with Northwest Airlines. On a combined basis, operating expenses increased 23% due to $1.2 billion in mainly non-cash special items, and $301 million in higher expense from out-of-period fuel hedges.(6) In addition, operating expenses were $33 million higher due to the impact of purchase accounting, which primarily relates to marking to market Northwest pension plan assets.



                          GAAP(3)               Combined(4)
                      ---------------         ---------------
 (in millions)                         Incr                    Incr
                       4Q08     4Q07  (Decr)   4Q08     4Q07  (Decr)
                      --------------- ------  --------------- ------

 Operating expense    $7,810   $4,685   67%   $9,451   $7,705   23%
 Operating expense
  excluding special
  items and impact
  of out-of-period
  fuel hedges         $6,732   $4,685   44%   $7,914   $7,726    2%
 Mainline CASM         14.83    11.18   33%    15.94    11.82   35%
 Mainline CASM
  excluding fuel
  expense and
  special items         7.22     6.79    6%     7.29     7.09    3%

 Non-operating expense	$341     $103   NM      $364     $190   NM

On a combined basis:



 * Mainline unit cost (CASM(7)) excluding fuel expense and special 
   items increased 3% year-over-year in the December 2008 quarter due 
   to prior year credits and the impact of purchase accounting, 
   partially offset by improved productivity; and
 * Non-operating expenses, increased $174 million in the December 2008
   quarter due to $77 million in foreign exchange losses and $66 
   million lower interest income. In addition, purchase accounting 
   drove $47 million in higher interest expense due to increased 
   amortization of debt discount, reflecting lower fair value of 
   Northwest debt at the merger date.

Liquidity Position

At Dec. 31, 2008, Delta had $6.1 billion in total liquidity and net cash collateral posted with hedge counterparties. Total liquidity includes $4.5 billion in cash, cash equivalents and short-term investments and $500 million available under an undrawn line of credit. Net cash collateral posted with hedge counterparties was $1.1 billion at Dec. 31, 2008.

At Dec. 31, 2008, Delta held $120 million in auction rate securities classified as long-term assets. These amounts were previously classified as short-term investments.

As previously announced, in December, Delta:



 * Received $1 billion from the pre-purchase of SkyMiles in connection
   with the multi-year extension of its exclusive co-brand credit card
   partnership with American Express; and
 * Sold approximately 18 million shares of common stock, generating
   gross proceeds of $196 million. All of the shares of stock in the
   offering had been withheld as the employee portion of withholding
   taxes on the employee equity awards which were issued or vested in
   connection with Delta's merger with Northwest.

"Delta people, once again, met the challenge of improving productivity in 2008 to help mitigate the impact of high fuel costs and a slowing economy. Their hard work allowed the company to remove the costs associated with reduced capacity, while continuing to make critical investments in our people, product and infrastructure. We will apply the Delta tradition of cost discipline across the entire company, and I am confident that we'll meet the cost targets necessary to maintain our best-in-class unit cost structure," said Hank Halter, chief financial officer. "In addition, we expect to generate cash and improve our liquidity in 2009 through our disciplined approach to making investments in our business, right-sizing our operations in the current demand environment, and achieving targeted merger synergies."

Fuel Price and Related Hedges

During the December 2008 quarter, Delta hedged 58% of its fuel consumption, resulting in an average fuel price of $2.90 per gallon.(8) Included in the fuel price is $507 million in fuel hedge losses in the fourth quarter.



                                    Three Months Ended
                                    Dec. 31, 2008 ($M)
                         -----------------------------------------
                          Operating    Non-Operating     Total
                         ------------- ------------- -------------
 Non-cash, out-of-period
  loss                             $91           $10          $101
 Loss (gain) on
  settled contracts                507            (1)          506
                         ------------- ------------- -------------
 Total net losses                 $598            $9          $607
                         ------------- ------------- -------------

The table below represents the fuel hedges Delta had in place as of Jan. 23, 2009 (see Note A for additional information about Delta's fuel hedges):



                              Avg. Jet Fuel
                               Equivalent*         Fuel
                           --------------------  Price/Gal.*
                 Percent                        (at today's
                  Hedged     Cap       Floor    fwd. curve)
                 --------  -------------------- ------------
 Q1 2009             80%    $2.81      $2.43        $2.34
 Q2 2009             85%    $2.45      $2.09        $2.17
 Q3 2009             55%    $2.19      $1.22        $2.10
 Q4 2009             32%    $2.24      $1.05        $2.00

 * Includes tax and transportation costs of approximately $0.17/gallon.

2008 Highlights

In 2008, in addition to completing its merger with Northwest Airlines, Delta demonstrated its commitment to delivering an industry-leading customer experience, creating long-term value for its shareholders and recognizing the valuable contributions of its employees by:



 * Investing throughout the year in its employees through almost $500
   million in pension and other retirement program contributions for
   Delta and Northwest employees, $56 million in combined Shared
   Reward and Incentive Program payments, pay raises and merger-
   related equity awards issued in 2008;
 * Investing in new technology and process re-engineering, resulting
   in a reduction of mishandled bags at Delta and Northwest by 20% and
   30%, respectively, year-over-year in the December quarter;
 * Launching its joint venture with Air France, further strengthening
   the SkyTeam alliance and filling a key position in Delta's
   portfolio by connecting its international gateways in Atlanta and
   New York to one of the world's premier business airports at London-
   Heathrow;
 * Receiving antitrust immunity for six-way alliance activities in
   trans-Atlantic markets for SkyTeam members Air France, Alitalia,
   CSA Czech Airlines, Delta, KLM Royal Dutch Airlines and Northwest
   Airlines, enabling the carriers to offer customers more choice in
   flight schedules, travel times, services and fares;
 * Implementing an expanded marketing alliance with Alaska Air Group,
   allowing the companies to offer customers more departures along the
   West Coast than any U.S. airline and the enhanced ability to
   connect passengers to Delta's growing global route system;
 * Continuing its international expansion to unique destinations and
   announcing new service from Los Angeles to Sydney, Australia to
   begin in July 2009, making Delta the only U.S. carrier to serve six
   continents;
 * Taking delivery of two new B777-LR aircraft to support Delta's
   international expansion and five B737-700 aircraft that allow the
   addition of service into airports requiring high-performance
   aircraft such as in Tegucigalpa, Honduras;
 * Providing SkyMiles members with more ways to redeem their miles by
   initiating a "Pay with Miles" program in partnership with American
   Express, expanding access to Medallion(r) Marketplace, growing the
   SkyMiles online auction program, and enhancing the Award Travel
   search calendar on delta.com;
 * Announcing plans to add new flat bed seats on Boeing 767-400
   aircraft to offer customers the comfort of a 180-degree full flat
   bed on every Delta flight between the United States and London's
   Heathrow Airport by the summer of 2009;
 * Joining with Aircell(r) to announce that Delta customers traveling
   throughout the continental United States will experience the
   convenience of broadband Wi-Fi on board Delta's domestic fleet of
   more than 330 mainline aircraft by the summer of 2009; and
 * Earning the prestigious 2008 Green Cross for Safety Medal from The
   National Safety Council, which recognizes organizations and their
   leaders for outstanding achievements in safety and health,
   community service and responsible citizenship.

Special Items

Delta recorded approximately $1 billion in special items in the December 2008 quarter, including:



 * Approximately $970 million in primarily non-cash, merger-related
   charges, including $904 million related to employee equity awards
   that were issued or vested in connection with the merger;
 * An $18 million charge related to Delta's previously announced plans
   to close operations in Concourse C at the Cincinnati airport; and
 * A $20 million write-down in the value of auction rate securities.

March 2009 Quarter and Full Year 2009 Guidance

Delta's projections for March 2009 quarter and 2009 performance are below. Financial results for Northwest Airlines are included for the entire periods of the March 2008 quarter and the full year 2008 so that year-over-year comparisons to the March 2009 quarter and full year 2009 projections are more meaningful.



                            1Q 2009 Forecast        2009 Forecast
                        ---------------------  ---------------------

 Non-passenger revenue(9)    $1.1 billion          $4.8 billion

 Fuel price, including
  taxes and hedges              $2.34                 $2.15

 Operating margin            (5%) - (7%)             6% - 8%

 Capital expenditures        $550 million          $1.6 billion

                           1Q 2009 Forecast       2009 Forecast
                        (compared to 1Q 2008)   (compared to 2008)
                        ---------------------  ---------------------
 Consolidated passenger
  unit revenue                                        Down 4%

 Mainline unit costs -
  excluding fuel expense
  and profit sharing(10)     Up 7% - 9%             Up 5% - 7%

 System capacity            Down 5% - 7%           Down 6% - 8%
  Domestic                 Down 10% - 12%          Down 8% - 10%
  International             Flat to up 2%          Down 3% - 5%

 Mainline capacity          Down 6% - 8%           Down 6% - 8%
  Domestic                 Down 13% - 15%         Down 10% - 12%
  International             Flat to Up 2%          Down 3% - 5%

Ancillary Businesses

Delta's ancillary businesses include TechOps, the largest airline MRO organization in North America, which serves more than 100 aviation and airline customers around the world, and DAL Global Services, which provides general aviation services, training and technical services, and staffing to airlines including Delta. The following table provides summarized financial information about these businesses for the December 2008 quarter.



                                      Three Months Ended
                                      December 31, 2008
                                   --------------------------
                                    TechOps       DAL Global
                                     (MRO)         Services
                                   --------------------------
  Operating Revenue (in millions)    $142             $49
  Operating Margin                    11%             (2%)

Other Matters

Included with this press release are Delta's Consolidated Statements of Operations for the three and twelve months ended Dec. 31, 2008 and 2007; a statistical summary for those periods; selected balance sheet data as of Dec. 31, 2008 and 2007; and a reconciliation of certain non-GAAP financial measures.

About Delta

Delta Air Lines is the world's largest airline. From its hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Salt Lake City and Tokyo-Narita, Delta, its Northwest subsidiary and Delta Connection carriers offer service to more than 377 destinations worldwide in 66 countries and serves more than 170 million passengers each year. Delta's marketing alliances allow customers to earn and redeem either SkyMiles or WorldPerks on more than 16,000 daily flights offered by SkyTeam and other partners. Delta and its 75,000 worldwide employees are reshaping the aviation industry as the only U.S. airline to offer a full global network. Customers can check in for flights, print boarding passes, check bags and flight status at delta.com.

The Delta Air Lines, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=1825

Endnotes

(1) Note B to the attached Consolidated Statements of Operations provides a reconciliation of non-GAAP financial measures used in this release and provides the reasons management uses those measures.

(2) Because Delta completed its merger with Northwest Airlines on Oct. 29, 2008, Delta's financial results under generally accepted accounting principles (GAAP) for 2008 and the December 2008 quarter include the results of Northwest Airlines for the period Oct. 30, 2008 through Dec. 31, 2008.

Under GAAP, Delta does not include in its financial results the results of Northwest Airlines prior to the completion of the merger. Accordingly, Delta's financial results under GAAP for the December 2007 quarter do not include the results of Northwest Airlines for that period. This impacts the comparability of Delta's financial statements under GAAP for the December 2008 and 2007 quarters.

In this press release, Delta presents its financial results for the December 2008 and December 2007 quarters under GAAP as well as on a "combined basis". "Combined basis" means the company combines the financial results of Delta and Northwest as if the merger had occurred prior to the beginning of the applicable period. For example, Delta's financial results on a combined basis for the December 2008 quarter include the financial results of Northwest Airlines for the period Oct. 1, 2008 through Dec. 31, 2008. Similarly, Delta's financial results on a combined basis for the December 2007 quarter include the financial results of Northwest Airlines for the period Oct. 1, 2007 through Dec. 31, 2007. Delta believes presenting this financial information on a combined basis provides a more meaningful basis for comparing Delta's year-over-year financial performance than the GAAP financial information.

This press release also includes guidance for the March 2009 quarter and full year 2009. Please note the year-over-year guidance comparisons assume the 2008 financial statements for the applicable periods were prepared on a combined basis, excluding special items and out-of-period fuel hedge losses.

(3) Financial results based on GAAP for the December 2008 quarter include results for Northwest Airlines for Oct. 30, 2008 through Dec. 31, 2008 compared to Delta standalone for the three months ended Dec. 31, 2007.

(4) Combined financial information includes results for both Delta and Northwest for the three months ended Dec. 31, 2008 and 2007.

(5) Domestic unit revenue, yield and capacity exclude charter operations.

(6) Reflects special items and out-of-period hedge impact for the three months ended Dec. 31, 2008.

(7) Delta excludes from mainline unit costs expenses for aircraft maintenance and staffing services which it provides to third parties because these expenses are not related to the generation of a seat mile. Similarly, Delta excludes from passenger unit revenues, and includes in other revenue, revenues received for providing aircraft maintenance, and staffing services to third parties, freighter operations and MLT. Management believes these classifications provide a more consistent and comparable reflection of Delta's mainline operations.

(8) December 2008 quarter average fuel price of $2.90 per gallon reflects the consolidated cost per gallon for mainline, owned and contract carrier operations, net of fuel hedge impact.

(9) Includes impact of deferred revenue accounting for SkyMiles program.

(10) Delta's March 2009 quarter mainline unit cost excluding fuel expense and profit sharing is expected to increase 7-9% year-over-year due to higher pension expense and the timing of removing costs related to capacity reductions.

Forward-looking Statements

Statements in this news release that are not historical facts, including statements regarding our estimates, expectations, beliefs, intentions, projections or strategies for the future, may be "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. All forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from the estimates, expectations, beliefs, intentions, projections and strategies reflected in or suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the cost of aircraft fuel; the impact that our indebtedness will have on our financial and operating activities and our ability to incur additional debt; the restrictions that financial covenants in our financing agreements will have on our financial and business operations; labor issues; interruptions or disruptions in service at one of our hub airports; our increasing dependence on technology in our operations; our ability to retain management and key employees; the ability of our credit card processors to take significant holdbacks in certain circumstances; the effects of terrorist attacks; competitive conditions in the airline industry; and our ability to achieve expected synergies from our merger with Northwest.

Additional information concerning risks and uncertainties that could cause differences between actual results and forward-looking statements is contained in Delta's Securities and Exchange Commission filings, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2007 and Form 10-Q for the quarterly period ended September 30, 2008. Caution should be taken not to place undue reliance on Delta's forward-looking statements, which represent Delta's views only as of January 27, 2009, and which Delta has no current intention to update.



                         DELTA AIR LINES, INC.
               Consolidated Statements of Operations(1)
                              (Unaudited)

                              Three      Three
                              Months     Months
                              Ended      Ended
 (in millions, except per    Dec. 31,   Dec. 31,    Change     Change
  share data)                  2008       2007      $ H(L)     % H(L)
 ---------------------------------------------------------------------

 OPERATING REVENUE:
  Passenger:
   Mainline                   $4,528     $3,052     $1,476         48%
   Regional carriers           1,207      1,015        192         19%
                              ------     ------     ------
  Total passenger revenue      5,735      4,067      1,668         41%
  Cargo                          230        132         98         74%
  Other, net                     748        484        264         55%
                              ------     ------     ------
   Total operating revenue     6,713      4,683      2,030         43%
 OPERATING EXPENSES:
  Aircraft fuel and related
   taxes                       2,294      1,356        938         69%
  Salaries and related costs   1,533      1,070        463         43%
  Contract carrier
   arrangements (2)              884        851         33          4%
  Depreciation and
   amortization                  374        288         86         30%
  Aircraft maintenance
   materials and outside
   repairs                       333        245         88         36%
  Contracted services            370        246        124         50%
  Passenger commissions and
   other selling expenses        298        212         86         41%
  Landing fees and other
   rents                         285        175        110         63%
  Passenger service              129         88         41         47%
  Aircraft rent                  106         60         46         77%
  Restructuring and merger-
   related items                 987         --        987         NM
  Other                          217         94        123         NM
                              ------     ------     ------
    Total operating expense    7,810      4,685      3,125         67%
                              ------     ------     ------
 OPERATING LOSS               (1,097)        (2)    (1,095)        NM
 OTHER (EXPENSE) INCOME:
  Interest expense              (277)      (138)      (139)        NM
  Interest income                 19         39        (20)       (51%)
  Miscellaneous, net             (83)        (4)       (79)        NM
                              ------     ------     ------
   Total other expense, net     (341)      (103)      (238)        NM
                              ------     ------     ------
 LOSS BEFORE INCOME TAXES     (1,438)      (105)    (1,333)        NM
 INCOME TAX BENEFIT               --         35        (35)        NM
                              ------     ------     ------
 NET LOSS                    ($1,438)      ($70)   ($1,368)        NM
                              ======     ======     ======
 BASIC AND DILUTED LOSS PER
  SHARE                       ($2.11)    ($0.18)        NM         NM
                              ======     ======     ======
 WEIGHTED AVERAGE SHARES
  USED IN BASIC AND DILUTED
  LOSS PER SHARE CALCULATION     682        395         NM         NM
                              ======     ======     ======

 (1) Includes results for Northwest from Oct. 30, 2008 through Dec.
     31, 2008.
 (2) Contract carrier arrangements expense includes $268 million and
     $305 million for the three months ended December 31, 2008 and
     2007, respectively, for aircraft fuel and related taxes.

                               Delta Air Lines, Inc.
                    Consolidated Statements of Operations (1)
                                   (Unaudited)

                                     (Successor +
                                       (Prede- 
                                        cessor)              (Prede-
                            (Successor)   (3)   (Successor)   cessor)
                            ----------- ------- -----------  --------
                                                    Eight      Four
                                                   Months     Months
                                 Year Ended        Ended      Ended
 (in millions, except per       December 31,      Dec. 31,  April 30,
  share data)                  2008      2007       2007      2007
 -------------------------------------------------------------------

 OPERATING REVENUE:
  Passenger:
   Mainline                   $15,137   $12,758    $8,929    $3,829

   Regional carriers            4,446     4,170     2,874     1,296
                             --------  --------  --------  --------
  Total passenger revenue      19,583    16,928    11,803     5,125
  Cargo                           686       482       334       148
  Other, net                    2,428     1,744     1,221       523
                             --------  --------  --------  --------

   Total operating revenue     22,697    19,154    13,358     5,796
 OPERATING EXPENSE:
  Aircraft fuel and related
   taxes                        7,346     4,686     3,416     1,270
  Salaries and related costs    4,802     4,189     2,887     1,302
  Contract carrier
   arrangements (2)             3,616     3,152     2,196       956
  Depreciation and
   amortization                 1,266     1,164       778       386
  Aircraft maintenance
   materials and outside
   repairs                      1,169       983       663       320
  Contracted services           1,153       996       670       326
  Passenger commissions and
   other selling expenses       1,030       933       635       298
  Landing fees and other
   rents                          839       725       475       250
  Passenger service               440       338       243        95
  Aircraft rent                   307       246       156        90
  Profit sharing                   --       158       144        14
  Impairment of goodwill and
   other intangible assets      7,296        --        --        --
  Restructuring and merger-
   related items                1,131        --        --        --
  Other                           616       488       299       189
                             --------  --------  --------  --------

   Total operating expense     31,011    18,058    12,562     5,496
                             --------  --------  --------  --------
 OPERATING (LOSS) INCOME       (8,314)    1,096       796       300
 OTHER (EXPENSE) INCOME:

  Interest expense               (705)     (652)     (390)     (262)

  Interest income                  92       128       114        14

  Miscellaneous, net             (114)       32         5        27
                             --------  --------  --------  --------

   Total other expense, net      (727)     (492)     (271)     (221)
                             --------  --------  --------  --------
 (LOSS) INCOME BEFORE
  REORGANIZATION ITEMS         (9,041)      604       525        79
 REORGANIZATION ITEMS, NET         --     1,215        --     1,215
                             --------  --------  --------  --------
 (LOSS) INCOME BEFORE INCOME
  TAXES                        (9,041)    1,819       525     1,294
 INCOME TAX BENEFIT
  (PROVISION)                     119      (207)     (211)        4
                             --------  --------  --------  --------
 NET (LOSS) INCOME            ($8,922)   $1,612      $314    $1,298
                             ========  ========  ========  ========
 BASIC (LOSS) INCOME PER
  SHARE                       ($19.08)       NM     $0.80     $6.58
                             ========  ========  ========  ========
 DILUTED (LOSS) INCOME PER
  SHARE                       ($19.08)       NM     $0.79     $4.63
                             ========  ========  ========  ========
 BASIC WEIGHTED AVERAGE
  SHARES OUTSTANDING              468        NM       394       197
                             ========  ========  ========  ========
 DILUTED WEIGHTED AVERAGE
  SHARES OUTSTANDING              468        NM       395       234
                             ========  ========  ========  ========

 (1) Includes results for Northwest from Oct. 30, 2008 through Dec.
     31, 2008.
 (2) Contract carrier arrangements expense includes $1.3 billion and
     $990 million for the year ended December 31, 2008 and 2007,
     respectively, in fuel expense.
 (3) In connection with its emergence from bankruptcy on April 30, 
     2007, Delta adopted fresh start reporting in accordance with 
     American Institute of Certified Public Accountants' Statement of
     Position 90-7, "Financial Reporting by Entities in Reorganization
     under the Bankruptcy Code."  The adoption of fresh start 
     reporting resulted in Delta becoming a new entity for financial
     reporting purposes.  Accordingly, Delta's consolidated financial
     statements after April 30, 2007 are not comparable to its 
     financial statements for any period prior to emergence. However,
     to provide a basis of comparison to current year results, Delta 
     has combined the results for the four months ended April 30, 
     2007 with the eight months ended Dec. 31, 2007.



                          DELTA AIR LINES, INC.
                       Selected Balance Sheet Data
                             (In Millions)

                                         December 31,  December 31,
                                         ------------  ------------
                                             2008          2007
                                         ------------  ------------
                                          (Unaudited)

 Cash and cash equivalents                   $  4,255      $  2,648
 Short-term investments                           212           138
 Restricted cash and investments                  453           535
 Total assets                                  45,019        32,423
 Total debt and capital leases, including
  current maturities                           16,571         9,000
 Total shareowners' equity                        848        10,113




                            DELTA AIR LINES
                     Combined Statistical Summary 1
                               (Unaudited)

                                           Three Months
                                          Ended Dec. 31,
                                         ---------------
                                          2008     2007    Change
                                         ------   ------   ------
 Consolidated:

  Revenue Passenger Miles (millions) (2) 46,848   48,172   (2.7%)
  Available Seat Miles (millions) (2)    58,098   60,402   (3.8%)
  Passenger Load Factor (2)                80.6%    79.8%    0.8 pts
  Fuel Gallons Consumed (millions) (2)      976    1,052   (7.2%)

 Mainline:

  Revenue Passenger Miles (millions)     40,810   42,107   (3.1%)
  Available Seat Miles (millions)        50,194   52,420   (4.2%)


                                         (Predecessor +
                           (Successor)     Successor)
                          -------------- --------------
                               Year Ended Dec. 31,
                          -----------------------------
                              2008           2007         Change
                          -------------- --------------  --------
 Consolidated:

  Revenue Passenger Miles
   (millions) (2)               202,726         200,502      1.1%
  Available Seat Miles
   (millions) (2)               246,164         245,259      0.4%

  Passenger Load Factor (2)        82.4%           81.8%     0.6 pts
  Fuel Gallons Consumed
   (millions) (2)                 4,158           4,254     (2.3%)

 Mainline:

  Revenue Passenger Miles
   (millions)                   177,361         176,493       0.5%
  Available Seat Miles
   (millions)                   213,447         214,059      (0.3%)

 1 Combined statistical data includes operations for both Delta and
   Northwest for the three months ended December 31, 2008 and 2007.
 2 Data presented includes operations under our contract carrier
   arrangements.


 Fleet Information
 Delta's fleet and firm orders at December 31, 2008 are summarized 
 in the following table.

                                                 Leased
                                          -------------------
                   #    Average                                  Firm
  Aircraft Type   A/C     Age     Owned   Operating   Capital   Orders
 ------------------------------------------------------------   ------
 Passenger
  Aircraft
 ----------
   B737-700         5         0       5          --        --        5

   B737-800        71         8      71          --        --       30

   B747-400        16        15       4          12        --       --

   B757-200       159        17      92          34        33       --

   B757-200ER      17        11      --          15         2       --

   B757-300        16         6      16          --        --       --

   B767-300        21        18       4          17        --       --

   B767-300ER      59        13      50           9        --       --

   B767-400        21         8      21          --        --       --

   B777-200ER       8         9       8          --        --       --

   B777-200LR       2         1       2          --        --        8

   B787-800        --       n/a      --          --        --       18

   A319-100        57         7      55           2        --        5

   A320-200        69        14      41          28        --        2

   A330-200        11         4      11          --        --       --

   A330-300        21         3      21          --        --       --

   MD-88          117        19      63          21        33       --

   MD-90           16        13      16          --        --       --

   DC-9            71        35      71          --        --       --

   CRJ-100         78        12      21          44        13       --

   CRJ-200        153         6       5         148        --       --

   CRJ-700         15         5      15          --        --       --

   CRJ-900         49         1      49          --        --       10

   Saab 340        49        11      --          49        --       --

   EMB 175         36         1      36          --        --       --

 Freighter
  Aircraft
 ----------

   B747F           10        25       7           3        --       --
                -----             ---------------------------   ------
   Total        1,147      12.3     684         382        81       78
                -----             ---------------------------   ------

 The table above:
 * Excludes 31 aircraft which will be sold to third parties
   immediately following delivery of these aircraft to Delta;
 * Excludes two aircraft orders assigned to Pinnacle Airlines; and
 * Includes three B767-300, two MD-88, four DC-9, one B757-200 and
   two B767-300ER aircraft that have been temporarily grounded.

 During the December 2008 quarter, the company:
 * Took delivery of one B737-700, five CRJ-900, and six EMB-175
   aircraft;
 * Adjusted the fleet count to add two EMB-174 aircraft that were
   delivered in September, 2008, but not flown in-service until
   October, 2008.
 * Adjusted the fleet count to add back four DC-9s that were
   temporarily grounded in a previous quarter;
 * Permanently grounded six B757-200, and one 747-200F aircraft;
 * Permanently grounded three CRJ-100 and four CRJ-200
   aircraft pending return to lessor; and
 * Sold one A-320 aircraft.

 In addition, the company sold two B757-200, three A-320, and
 two B747-200F aircraft that had been removed from the fleet
 prior to October 1, 2008.

 Note A:
 The tables below represent additional information about fuel hedges
 Delta had in place as of Jan. 23, 2009:

                                            2009
                           -------------------------------------
 Legacy Positions:           Q1        Q2        Q3        Q4
                           -------   -------   -------   -------
 Call                           6%        6%       18%       15%
 Collar                        40%       33%        3%       --
 Swap                           9%       --        --        --
                           -------   -------   -------   -------
 Total                         55%       39%       21%       15%
                           -------   -------   -------   -------

 Avg. crude call cap       $   90    $   90    $   82    $   86
 Avg. crude collar cap     $  122    $  122    $  127    $   --
 Avg. crude collar floor   $  108    $  108    $  118    $   --

 Recent Positions:
 Call                           1%        5%       12%        4%
 Swap                          24%       41%       22%       13%
                           -------   -------   -------   -------
 Total                         25%       46%       34%       17%
                           -------   -------   -------   -------

 Avg. crude cap            $   45    $   55    $   59    $   61

 Total hedge percent           80%       85%       55%       32%


 Note B: The following tables show reconciliations of non-GAAP
 financial measures.  The reasons Delta uses these measures are
 described below.


  *  Because Delta completed its merger with Northwest Airlines on
     October 29, 2008, Delta's financial results under generally
     accepted accounting principles (GAAP) for 2008 and the December
     2008 quarter include the results of Northwest Airlines for the
     period October 30, 2008 through December 31, 2008.

     Under GAAP, Delta does not include in its financial results the
     results of Northwest Airlines prior to the completion of the
     merger. Accordingly, Delta's financial results under GAAP for
     the December 2007 quarter do not include the results of Northwest
     Airlines for that period.  This impacts the comparability of
     Delta's financial statements under GAAP for the December 2008 and
     2007 quarters.

     Delta presents its financial results for the December 2008 and
     December 2007 quarters under GAAP as well as on a "combined 
     basis." "Combined basis" means the company combines the 
     financial results of Delta and Northwest as if the merger had 
     occurred prior to the beginning of the applicable period. Delta 
     believes presenting this financial information on a combined 
     basis provides a more meaningful basis for comparing Delta's 
     year-over-year financial performance than the GAAP financial
     information.

     The press release also includes guidance for the March 2009
     quarter and full year 2009.  Please note the year-over-year
     guidance comparisons assume the 2008 financial statements for
     the applicable periods were prepared on a combined basis,
     excluding special items and out-of-period fuel hedge losses.
     Delta is unable to reconcile certain forward-looking projections
     to GAAP, including projected Mainline non-fuel CASM, as the
     nature or amount of special items cannot be estimated at this
     time.

  *  Delta excludes special items because management believes the
     exclusion of these items is helpful to investors to evaluate the
     company's recurring operational performance.

  *  Delta excludes non-cash mark-to-market (MTM) adjustments related
     to fuel hedges settling in future periods in order to present
     financial results related to operations in the period shown.

  *  Delta presents Mainline CASM excluding fuel expense and related
     taxes because management believes the volatility in fuel prices
     mask the progress toward achieving business plan targets.

  *  Mainline cost per available seat mile (CASM) excludes $221
     million and $123 million for the years ended December 31, 2008
     and 2007, respectively, and Combined Mainline CASM excludes
     $303 million and $406 million for the years ended December 31,
     2008 and 2007, respectively, in transactions with third parties
     as these costs are not associated with the generation of a seat
     mile.  These transactions include expenses related to Delta's
     providing maintenance services, staffing services and freight
     operations as well as Delta's vacation wholesale operations.

  *  Delta presents length of haul adjusted passenger revenue per
     available seat mile (PRASM), including adjustments for other
     airline revenue and certain other revenue, because management
     believes this provides a more meaningful comparison of the
     company's PRASM to the industry.


      
                                              Three
                                              Months           Year
                                               Ended           Ended
                                             Dec. 31,        Dec. 31,
                                               2008            2008
                                              -------         -------
 (in millions, except per share data)


 Net loss                                     $(1,438)        $(8,922)
 Items excluded:
 Impairment of goodwill and other
  intangible assets                                --           7,296
 Merger-related expenses                          969             978
 Restructuring and related items                   18             139
 Mark-to-market ("MTM") adjustments to fuel
  hedges settling in 2009                          91              91
 Write-down in value of auction rate
  securities                                       20              20
 Termination of contract carrier arrangements      --              14
 Income tax benefit associated with
  intangible assets                                --            (119)
                                              -------         -------
 Net loss excluding special items and
  MTM adjustments to fuel hedges settling
  in 2009                                     $  (340)        $  (503)
                                              =======         =======
 Basic and diluted weighted average shares
  outstanding                                     682             468
 Basic and diluted loss per share excluding
  special items and MTM adjustments to fuel
  hedges settling in 2009                     $ (0.50)        $ (1.08)
                                              =======         =======


                                              Three
                                              Months
                                               Ended
                                             Dec. 31,
                                               2008
                                              -------
 Net loss excluding special items and MTM
  adjustments to fuel hedges settling in
  2009 per above                              $  (340)
 Items excluded:
 Fuel hedge losses on contracts that settled
  in 2008                                         507
                                              -------
 Net income excluding fuel hedge losses,
  special items and MTM adjustments to fuel
  hedges settling in 2009                     $   167
                                              =======


 Passenger and
  operating revenue  Delta   Northwest  Combined
                     -----   ---------  --------
                     Three               Three
                     Months    Oct.1,    Months
                     Ended     2008 to   Ended   Passenger
                    Dec. 31,  Oct. 29,  Dec. 31,   Mile
 (in millions)        2008      2008      2008     Yield     PRASM
                     ------    ------    ------   ------     ------
 Passenger:
 Domestic            $2,639    $  420    $3,059    13.31 c    11.14 c
 Atlantic             1,129       134     1,263    12.02       9.26
 Latin America          308         2       310    14.92      10.93
 Pacific                452       185       637    11.71       9.90
                     ------    ------    ------
 Total mainline       4,528       741     5,269    12.91      10.50
   Regional carriers  1,207       181     1,388    22.99      17.56
                     ------    ------    ------
 Total passenger
  revenue             5,735       922     6,657    14.21      11.46
 Cargo                  230        55       285
 Other, net             748        78       826
                     ------    ------    ------
   Total operating
    revenue          $6,713    $1,055    $7,768
                     ======    ======    ======

                                                 Passenger
                         Three Months Ended         Mile
                          December 31, 2007        Yield     PRASM
                     ---------------------------  ------     ------
 (in millions)       Delta   Northwest  Combined
                     -----   ---------  --------
 Passenger:                                        
 Domestic            $1,930    $1,409    $3,339    13.38 c    10.71 c
 Atlantic               797       346     1,143    11.87       9.52
 Latin America          277        19       296    13.35      10.36
 Pacific                 48       533       581    11.22       9.47
                     ------    ------    ------
 Total mainline       3,052     2,307     5,359    12.73      10.22
   Regional carriers  1,015       337     1,352    22.30      16.94
                     ------    ------    ------
 Total passenger
  revenue             4,067     2,644     6,711    13.93      11.11
 Cargo                  132       242       374
 Other, net             484       221       705
                     ------    ------    ------
   Total operating
    revenue          $4,683    $3,107    $7,790
                     ======    ======    ======



                                                    Year Ended
                                                 December 31, 2008
                                             -----------------------
                                              Delta        Northwest
                                             -------       ---------
 PRASM                                         11.82 c        12.52 c
 Length of haul adjustment, including
  adjustments for other airline and
  passenger revenue                             0.22          (0.25)
                                             -------        -------
 Length of haul adjusted PRASM, including
  adjustments for other airline and
  passenger revenue                            12.04 c        12.27 c
                                             -------        -------
 Industry average PRASM                        11.92 c        11.92 c
                                             -------        -------
 Percentage of industry average                  101%           103%
                                             =======        =======

                                               Three Months Ended
                                                  December 31,
                                             ----------------------
 (in millions)                                2008           2007
                                             -------        -------
 Operating expense                           $ 7,810        $ 4,685
 Items excluded:
 Merger-related items                           (969)            --
 Restructuring and related items                 (18)            --
 MTM adjustments to fuel hedges settling
  in 2009                                        (91)            --
                                             -------        -------
 Operating expense excluding special items
  and MTM adjustments to fuel hedges
  settling in 2009                             6,732          4,685
 Northwest results for the period from
  October 1 to October 29, 2008 and three
  months ended December 31, 2007,
  respectively                                 1,641          3,020
 Items excluded:
 Merger-related items                           (249)            --
 MTM adjustments to fuel hedges settling
  in 2009                                       (210)            21
                                             -------        -------
 Combined operating expense excluding
  special items and MTM adjustments to fuel
  hedges settling in 2009                    $ 7,914        $ 7,726
                                             =======        =======
 Combined operating expense including
  special items and MTM adjustments to fuel
  hedges settling in 2009                    $ 9,451        $ 7,705
                                             =======        =======


                                               Three Months Ended
                                                  December 31,
                                             ----------------------
                                              2008           2007
                                             -------        -------
 Mainline CASM                                 14.83 c        11.18 c
 Items excluded:
 Merger-related items                          (2.22)            --
 MTM adjustments to fuel hedges settling
  in 2009                                      (0.21)            --
 Transactions with third parties and other     (0.51)         (0.39)
 Fuel expense and related taxes                (4.67)         (4.00)
                                             -------        -------
 Operating expense excluding fuel expense
  and related taxes, special items and MTM
  adjustments to fuel hedges settling in 2009   7.22 c         6.79 c
                                             =======        =======
 ASMs                                         43,532         31,358
                                             =======        =======

                                               Three Months Ended
                                                  December 31,
                                             ----------------------
 (in millions, except per cent data)          2008           2007
                                             -------        -------
 Combined Mainline CASM
 Mainline operating expense                  $ 6,457        $ 3,507
 Northwest results for the period from
  October 1 to October 29, 2008 and three
  months ended December 31, 2007,
  respectively                                 1,542          2,689
                                             -------        -------
 Combined Mainline operating expense         $ 7,999        $ 6,196
                                             =======        =======
 Combined Mainline CASM                        15.94 c        11.82 c
 Merger-related items                          (2.43)            --
 MTM adjustments to fuel hedges settling
  in 2009                                      (0.60)          0.04
 Transactions with third parties and other     (0.60)         (0.77)
 Fuel expense and related taxes                (5.02)         (4.00)
                                             -------        -------
 Combined Mainline CASM excluding fuel
  expense and related taxes, special items
  and MTM adjustments to fuel hedges
  settling in 2009                              7.29 c         7.09 c
                                             =======        =======
 Combined ASMs                                50,194         52,420
                                             =======        =======


                                           Three Months
                                              Ended
                                          Dec. 31, 2008
                                          -------------
 Average price per fuel gallon               $  3.01
 Items excluded:
 MTM adjustments to fuel hedges settling
  in 2009                                      (0.11)
                                          -------------
 Average price per fuel gallon excluding
  MTM adjustments to fuel hedges settling
  in 2009                                    $  2.90
                                          =============


                                                      Three Months
                                                    Ended December 31,
                                                    ------------------
 (in millions)                                        2008      2007
                                                    -------   --------
 Total other expense, net                           $ (341)   $ (103)
 Northwest results for the period from October 1
  to October 29, 2008 and three months ended
  December 31, 2007, respectively                      (43)     (101)
 Items excluded:
 Write-down in value of auction rate securities         20        --
 Loss on sale of interest in affiliate                  --        14
                                                    -------   --------
 Combined Total other expense, net excluding
  special items                                     $ (364)   $ (190)
                                                    =======   ========

                                               FORECAST
                               ---------------------------------------
                                March 2009 Quarter    Full Year 2009
                                 Projected Range      Projected Range
                               -------------------   -----------------
 Mainline CASM projection        12.36 c   12.50 c   11.62 c   11.76 c
 Items excluded:
 Transactions with third
  parties and other              (0.53)    (0.53)    (0.54)    (0.54)
 Profit Sharing                     --        --     (0.08)    (0.08)
 Fuel expense and related taxes  (3.83)    (3.83)    (3.45)    (3.45)
                               -------------------   -----------------
 Mainline CASM projection
  excluding fuel expense and
  related taxes and special
  items                           8.00 c    8.14 c    7.55 c    7.69 c
                               ===================   =================
 Change year-over-year in
  Mainline CASM excluding fuel
  expense and related taxes
  and special items                  7%        9%        5%        7%

 Note: c = cents

            

Coordonnées