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Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures March 2004 Quarter Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures
March 2004 Quarter
Three
Months Ended
Operating Expenses
March 31,
(in millions)
2004
2003
Operating expenses
$3,680
$3,690
Less: fuel expense
(574)

(511)

Unusual item:
Pension benefits for 2002 workforce reductions
-

(43)

Operating expenses - excluding fuel expense and unusual item
$3,106
$3,136
Year over year change
-1.0%
Three
Months Ended
Mainline - Operating Expenses
March 31,
(in millions)
2004
2003
Operating expenses
$3,165
$3,236
Less: fuel expense
(470)

(424)

Unusual item:
Pension benefits for 2002 workforce reductions
-

(43)

Operating expenses - excluding fuel expense and unusual item
$2,695
$2,768
Year over year change
-2.7%
Three
Months Ended
CASM and Fuel Price Neutralized CASM
March 31,
(in cents, except where noted)
2004
2003
Operating expenses (millions)
$3,680
$3,690
ASMs (millions)
34,363

33,204

CASM
10.71

11.11

Less: fuel expense
(1.67)

Plus: current year fuel gallons x prior year fuel price
(1)
1.52

Fuel price neutralized CASM
10.56

vs. March 2003 quarter CASM
11.11

Change
-4.9%
CASM (see above)
10.71

11.11

Unusual item:
Pension benefits for 2002 workforce reductions
-

(0.13)

CASM - excluding unusual item
(2)
10.71

10.98

Year over year change
-2.5%
CASM - excluding unusual item
(2)
10.71

Less: fuel expense
(1.67)

Plus: current year fuel gallons x prior year fuel price
(1)
1.52

Fuel price neutralized CASM - excluding unusual item
(2) (3) (4)
10.56

vs. March 2003 quarter CASM - excluding unusual item
10.98

Change
-3.8%
(1)
603 million gallons x 86.89 cents/gallon divided by 34.363 billion ASMs for the three months ended
March 31, 2004.
(2)
In the March 2004 quarter there were no unusual items to exclude.
(3)
Operating cost per available seat mile (ASM), adjusting average fuel price per gallon for the period
to equal the average fuel price per gallon for the corresponding period in the prior year.
(4)
We believe this non-GAAP financial measure assists investors in understanding the impact
of changes in fuel costs on our operations. Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures
March 2004 Quarter
As of
Net Debt-to-Capital Ratio
March 31,
(in millions)
2004
Debt (including current maturities)
$12,479
Capital leases (including current portion)
95
Net implied debt
(5)
5,801
Total net debt
$18,375
Total net debt
$18,375
ESOP preferred stock
275
Shareowners' deficit
(1,028)
Total capital
$17,622
Net debt-to-capital ratio
104%
(5)
Net implied debt represents the present value of our operating lease obligations, net of cash,
cash equivalents and short term investments.
As of
Total Debt including Operating Leases
March 31,
(in millions)
2004
Debt (including current maturities)
$12,479
Capital leases (including current portion)
95
Implied debt
(6)
7,981
Total debt
$20,555
(6)
Implied debt represents the present value of our obligations under operating leases.
Three
Months Ended
Capital Expenditures
March 31,
(in millions)
2004
Cash used by investing activities - GAAP
Flight equipment additions
(157)

Ground property and equipment additions
(92)

Add:
Aircraft delivered under seller-financing
(55)

Less:
Advanced deposits, net
27

Boston airport terminal project expenditures
50

Capital expenditures
($227)
Three
Months Ended
Cash Flow from Operations
March 31,
(in millions)
2004
Cash used in operating activities - GAAP
($280)
Add:
Pension funding
396

Adjusted cash flow
$116
June 2004 Quarter and Full Year 2004 Guidance on CASM and Fuel Price Neutralized CASM
Reconciliations for forward-looking guidance for CASM and fuel price neutralized CASM, excluding
unusual items, have not been provided because Delta cannot project specific unusual items that may occur
in future periods. Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures
June 2004 Quarter
Three
Months Ended
June 30, 2004
Financial Information
Net Loss
(in millions)
Basic and
Diluted EPS
GAAP
($1,963)
($15.79)
Items excluded:
Pension settlements
117

0.94

Deferred income tax asset reserve
1,534

12.30

Non-GAAP
(1)
($312)
($2.55)
Three
Months Ended
Mainline - Operating Expenses
June 30,
(in millions, except where noted)
2004
2003
Mainline operating expenses
$3,426
$2,738
Less: fuel expense
(555)

(361)

Items excluded:
Pension settlements
(117)

-

Appropriations Act reimbursements
-

319

Mainline operating expenses - excluding items above and fuel expense
(1) (2)
$2,754
$2,696
Year over year change
2.2%
Three
Months Ended
CASM and Fuel Price Neutralized CASM
June 30,
(in cents, except where noted)
2004
2003
CASM
10.88

9.92

Items excluded:
Pension settlements
(0.30)

-

Appropriations Act reimbursements
-

1.20

CASM - excluding
(1)
10.58

11.12

Year over year change
-4.9%
CASM - excluding
(1)
10.58

Less: fuel expense
(3)
(1.73)

Plus: current year fuel gallons x prior year fuel price
(4)
1.26

Fuel price neutralized CASM - excluding
(1) (5) (6)
10.11

vs. June 2003 quarter CASM - excluding
11.12

Change
-9.1%
Three
Months Ended
Mainline - CASM and Fuel Price Neutralized CASM
June 30,
(in cents, except where noted)
2004
2003
Mainline CASM
10.32

9.56

Items excluded:
Pension settlements
(0.35)

-

Appropriations Act reimbursements
-

1.12

Mainline CASM - excluding
(1)
9.97

10.68

Less: fuel expense
(7)
(1.67)

Plus: current year fuel gallons x prior year fuel price
(8)
1.21

Mainline fuel price neutralized CASM - excluding
(1) (5) (9)
9.51

vs. June 2003 quarter Mainline CASM - excluding
10.68

Change
-11.0% Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures
June 2004 Quarter
Net Debt-to-Capital Ratio
As of
(in millions, except where noted)
June 30, 2004
Debt and capital leases (including current maturities and short-term)
$12,552
Net implied debt
(10)
6,015
Total net debt
$18,567
Total net debt
$18,567
ESOP preferred stock
281
Shareowners' deficit
(2,952)
Total capital
$15,896
Net debt-to-capital ratio
117%
Total Debt including Operating Leases
As of
(in millions)
June 30, 2004
Debt and capital leases (including current maturities and short-term)
$12,552
Implied debt
(11)
7,981
Total debt
$20,533
Three
Capital Expenditures
Months Ended
(in millions)
June 30, 2004
Cash used by investing activities - GAAP:
Aircraft (including advanced payments)
($104)
Aircraft modifications and parts
($56)
Total flight equipment additions
(160)

Ground property and equipment additions
(111)

Less:
Advanced payments on aircraft, net
24

Boston airport terminal project expenditures
45

Capital expenditures
(202)

(1)
We believe that providing financial and statistical data that excludes the items above is helpful to
investors to evaluate recurring operational performance because (1) the deferred income tax reserve and
pension settlements are not representative of current period operations and (2) the reimbursements
received under the Appropriations Act in 2003 were a one-time item.
(2)
We believe that the exclusion of fuel expense, which has increased significantly due to historic high
fuel prices, allows investors to better understand the changes in our Mainline operating expenses.
(3)
$669 million divided by 38.620 billion ASMs for the three months ended June 30, 2004.
(4)
639 million gallons x 76.29 cents/gallon divided by 38.620 billion ASMs for the three months ended
June 30, 2004.
(5)
Operating cost per available seat mile (ASM), adjusting average fuel price per gallon for the period
to equal the average fuel price per gallon for the corresponding period in the prior year.
(6)
We believe this non-GAAP financial measure assists investo