Delivering Growth in a Challenging Market. AAWW Analyst and Investor Day May 12, PDF Free Download

Delivering Growth in a Challenging Market AAWW Analyst and Investor Day May 12, 2009

Safe Harbor Statement This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect AAWW s current views with respect to certain current and future events and financial performance. Such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of AAWW and its subsidiaries that may cause actual results to be materially different from any future results, express or implied, in such forward-looking statements. For additional information, we refer you to the risk factors set forth under the heading Risk Factors in the Annual Report on Form 10-K filed by AAWW with the Securities and Exchange Commission on Feb. 26, 2009. Other factors and assumptions not identified above are also involved in the preparation of forward-looking statements, and the failure of such other factors and assumptions to be realized may also cause actual results to differ materially from those discussed. AAWW assumes no obligation to update the statements in this presentation to reflect actual results, changes in assumptions, or changes in other factors affecting such estimates, other than as required by law. This presentation also includes some non-gaap financial measures. You can find our presentations on the most directly comparable GAAP financial measures calculated in accordance with generally accepted accounting principles and our reconciliations in our earnings release dated Feb. 24, 2009, which is posted on our Web site at www.atlasair.com. 2

Today s AAWW Attendees (speakers in bold) Bill Flynn President & CEO John Dietrich EVP, COO Michael Steen SVP, CMO Ray Sisson President & CEO Titan Aviation Tom Kane VP, Defense & Govt. Programs Jason Grant SVP, CFO Adam Kokas SVP, Gen Counsel, CHRO Spencer Schwartz VP, Controller Ed McGarvey VP, Treasurer Greg Guillaume VP, FP&A & Bus Development Mark Tender Sr. Director, Corp Comm Dan Loh Sr. Manager, Investor Relations 3

Today s Agenda 9:00-9:30 Overview Bill Flynn 9:30-10:00 Commercial Michael Steen 10:00-10:15 Break 10:15-10:45 Operations John Dietrich 10:45-11:15 Financial Jason Grant 11:15-11:30 Wrap Up Bill Flynn 11:30-Noon Q&A Team Noon-1:00 Lunch 4

Overview Bill Flynn President & CEO

Atlas Air Worldwide Holdings, Inc. & Subsidiaries - Ownership: 100% - Ownership: 51% (49% DHL) - Ownership: 100% - Ownership: 49% Atlas Air Worldwide Holdings, Inc. (NASDAQ: AAWW) Recognized leader in international aviation outsourcing World s largest fleet of Boeing 747 freighter aircraft Comprehensive global infrastructure Providing superior assets and services to the airline industry, freight-forwarding community, commercial and military customers 6

Our Unique Value Proposition Our business model combines a core aircraft leasing model with turnkey operating solutions to drive customer and enterprise value through: Access to state-of-the-art assets Favorable long-term demand/supply trends Offering the lowest unit operating costs of any freighter alternatives Attractive positioning relative to global trade flows and higher fuel costs Leveraging effect of customer freighter operations Airline customer drives cargo contribution across broader pax network Economies of scale Outsourced solutions overcome minimum economic fleet size issues Experience, scale and scope of quality services drive operational integration Creates barriers to entry 7

AAWW Investment Thesis Well Positioned in Challenging Conditions Leading Industry Position Service Quality, Scale & Scarcity of Assets Long-Term Strategic Customer Relationships Stable Base of Contractual Revenues/Reduced Commercial Risk Platform for Growth Well positioned for earnings growth in 2009 8

Current Marketplace Environment Global markets have been struggling Recessionary environment and tight credit conditions have Affected global trade and international airfreight traffic Reduced demand for commercial charters; put pressure on yields IATA - International Air Freight Demand - % Change vs. Prior Year 4.5 5.9 3.3 3.7 1.3-0.8-1.9-2.7-7.7-7.9-13.5-22.6-23.2-22.1-21.4 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2008 2009 9

Current Marketplace Environment But global airfreight tonnage remains sizeable 30.4 28.8 31.4 33.5 36.7 37.6 39.8 41.6 39.7 34.6 2000 2001 2002 2003 2004 2005 2006 2007 2008E 2009F Freight Tonnes (millions) - Source: ICAO to 2007, IATA 2008-09 And the current cycle will break IATA forecast: international airfreight traffic (FTKs) returns to growth during 2010 2008A: (4.0%); 2009F: (13.0%); 2010F: 4.0%; 2011F: 7.5% 10

2008 2009 Supply Trend 747-200F global fleet has dropped by 39% since 1/1/08 747-400F production ended in 2Q09; -400SF conversion activity has diminished Manufacturer-caused delays have pushed out 747-8F and 777F introductions 145 Aircraft Counts 146 148 140 Dec 2007 108 Dec 2008 88 Apr 2009 39% 65 60 57 35 43 46 78 78 78 78 78 72 747-200F MD-11F 747-400F 747-400SF 747-8F 777F Old Technology Shrinking Fast Current Technology Low Growth New Technology Orders Flat * Sources: Ascend, Boeing. Excludes parked aircraft, aircraft in express operations & combis; 747-200F total includes -100s & -300s. April 2009 777F total includes four deliveries. 11

Well Positioned in Challenging Conditions Transformed AAWW business model well positioned to perform in difficult environment Polar express network service for DHL improves and de-risks earnings Best-in-class 747-400F assets; high-quality customer base; long-term contracts mitigate market risks Minimal fuel exposure ACMI, DHL, AMC customers cover fuel Older Classic fleet unencumbered and managed opportunistically Strong balance sheet with high level of liquidity 12

Transformed Model Positioned to Perform Polar s transformation generates earnings improvement and reduced volatility Pretax Income ($ Millions) $38.5 Blocked Space Agreement $10.1 $24.8 (Ex. onetime items) $1.5 -$6.2 -$6.4 1Q05 1Q06 1Q07 1Q08 1Q09 Express Network ACMI Flight Services *Excludes a $10.0 termination penalty, $2.7 gain on retirement of debt, and $1.0 gain on sale of assets. 13

Best Assets, High-Quality Customer Base The leading provider of freighter aircraft leasing and operating solutions Market Dynamics Attractive Wide-Body Freighter Aircraft Cost-Effective Global Operating Solutions Long-Term Customer Relationships Diversified Portfolio of Assets & Services Challenging near-term conditions Favorable long-term demand/supply dynamics Largest fleet of 747 freighters Scarce, efficient assets delivering lowest unit operating costs Crew Maintenance Flight Operations Logistics Support DHL (14 yrs.) Emirates (14) BA (13) Qantas (8) U.S. Military (11) ACMI (1) Dry Leasing AMC (2) Commercial Charter Growth for ACMI solutions Launch customer for 747-8 freighter Network scale & Scope (1) Aircraft, Crew, Maintenance, Insurance. (2) U.S. Air Mobility Command. 14

Leading Industry Position Only outsourced provider with -8Fs on order; operator of 21 out of 26 available -400Fs Number of Aircraft/Orders 60 50 40 30 B747-8F Option/Rights B747-200F B747-400 Converted Order B747-400 Converted B747-8F Order B747-400F 20 10 0 AAWW Kalitta Southern Evergreen Air Atlanta Icelandic World Sources: AAWW, Ascend. 747-200F total includes -100s and -300s. 15

Fleet Size and Composition Focused on leading-edge 747-400s and next-gen 747-8Fs Remaining 747 Classics are unencumbered Classics to be managed opportunistically/rationalized over time As of Year-End 2003 2007 2008 2012F 747-8F -- -- -- 12 747-400 20 20 22 22 747-200* 32 17 7 -- * 747-200 Classics totals include 747-100s and -300s 16

Boeing 747-8F Program Update Boeing has announced a delay in its 747-8F program Delivery of Boeing s very first -8F now planned 3Q 2010 vs. late 2009 AAWW currently discussing delivery-schedule status of 12 Atlas 747-8Fs on order with Boeing Six 747-8Fs originally scheduled to join Atlas fleet in 2010 (beginning February 2010) Six were planned for 2011 Delivery delay will result in commensurate holiday with respect to predelivery deposit payments owing to Boeing; no increased escalation during delay Continue to look forward to introducing next-generation 747-8F into fleet Will provide customers cutting-edge aircraft with superior payload and operating economics 17

Cash and Debt Summary Strong Balance Sheet, High Liquidity $672 $655 $583 PDP Debt $306 $232 $477 $411 $442 $419 $394 $217 $217 $455 $438 2005 2006 2007 2008 1Q09 2005 2006 2007 2008 1Q09 Cash Balance ($ Mil) Balance Sheet Debt ($ Mil) 18

Commercial Update Michael T. Steen Senior Vice President & Chief Marketing Officer

We Facilitate Global Trade with Premium Assets and Market-Leading Services Connecting with our customers is paramount Our assets are highly valuable Leading Innovation is key to creating new value offerings Our services add value We provide a wide range of solutions Delivering a compelling, unique value proposition and unmatched operational excellence 21

Powering Industries That Depend on Airfreight Atlas Air provides dedicated capacity, allowing our customers to deliver time-sensitive products to major consumer markets around the globe: Technology and consumer goods Pharmaceuticals High-end fashion goods Fresh flowers and perishables Livestock Program charters meet the needs of various industries: Infrastructure equipment to service large projects in growth markets The U.S. Military Drilling and excavation equipment for the oil industry Entertainment charters: major concerts, shows and exhibitions Formula 1 and A1 Grand Prix motor sport 22

Examples of Value Creation to Customers Customer Challenges Flexible access to additional aircraft Access to new routes and traffic rights Extended range and optimized capacity utilization CMI solution combined with traffic rights and global management capabilities AAWW Solution Inducting new assets Realizing immediate revenue generation Providing Atlas Air traffic rights Realizing immediate new revenue Introducing better performing aircraft Improving lead times and utilization Tailoring a CMI solution and providing Atlas Air traffic rights and building on Best Practices Delivering Immediate Value Adding incremental revenue Optimizing ROI 23

The ACMI Value Proposition Global trade is dependant on reliable airfreight solutions Approximately 50% of global airfreight still travels in the lower cargo holds of passenger aircraft Outside of the U.S., freight is a significant portion of airline revenues < 5% for U.S. major airlines 5% - 10%+ for European major airlines 15% - 30%+ for Asian major airlines Freight is a significant margin contributor to passenger operations, as passenger operating costs are sunk Freighter operations are needed to drive market share with forwarders and attract better-yielding freight onto passenger network Economies of scale, scope and barriers to investment in freighter aircraft make outsourced solutions attractive Data sources: Air Cargo Management Group, Boeing 24

Delivering Value to Our Customers Freighters secure forwarder commitments and drive passenger-fleet utilization The operation of our dedicated freighter fleet has been a great success. They are used to operate a mix of scheduled and charter services and support Qantas passenger aircraft belly hold capacity to key cargo destinations. Grant Fenn Executive General Manager Qantas Freight 25

Delivering Value to Our Customers Understanding the market and delivering integrated solutions The Emirates SkyCargo Atlas Air relationship spans 14 years and is our longest relationship with any ACMI provider. Today that relationship is a partnership in every sense of the word, with Atlas knowing our business requirements as well as we do. Without the reliability and support Atlas provides, Emirates would not be able to provide our consistently high levels of service. We are proud to work with such a professional team and look forward to continuing our relationship with Atlas for many years to come. Hiran Perera Senior Vice President Freighters, Emirates SkyCargo 26

Powering Time-Definite Industries: Case Study Global Perishables distribution: Atlas Air flies several times per week connecting Miami to Brazil, Chile, Peru and back to Miami Our forwarder partners deliver custom-packed perishables directly from the farm; our handling agent builds cargo pallets in a cooled warehouse Perishables are flown for 8.5 hours under controlled temperatures, maintaining their freshness and quality Cargo is offloaded and distributed within 2 hours after arrival U.S. consumers can enjoy fresh perishables within 24 hours after being harvested, all year round 27

Powering Time-Definite Industries: Case Study Formula 1 motor sport chooses Atlas Air to transport the most technologically-advanced cars in the world: Atlas Air awarded contracts to support the 2009 season: Australian, Malaysian, Chinese, and Bahrain Grand Prix amongst others F1 selected our Boeing 747-400 freighters due to their superior operating performance and economic advantage over other freighters A pupose-built freighter (not a conversion), the 747-400F s noseloading door & advanced cargomanagement system enable quick, efficient handling of oversized cargos F1 continues to expand its presence in new markets globally 28

Powering Time-Definite Industries: Case Study U.S. Air Mobility Command: Atlas Air is a top-rated AMC carrier Unmatched operational excellence, only carrier with 747-400F capability Serving strategic destinations: Germany, Turkey, Kuwait, Iraq, Afghanistan, Qatar via Dover & Maguire AFBs On-time delivery of critical supplies, perishables and infrastructure equipment 29

Titan Aviation Leasing Atlas Dry Leasing Unit Product Offerings: Operating Lease Solutions Acquisition and financing of freighter and freighter-conversion aircraft Freighter Aircraft Conversion Management Total lifecycle management, including feedstock procurement and project technical oversight Asset-Management Services Deal origination, lease management, re-marketing Asset-type exit-strategy planning and participation Only Atlas can offer customers a complete solution 30

World Air Cargo Forecast 2009-2029 Air Cargo Management Group (ACMG) baseline projection (April 2009) 6% compound annual growth rate (CAGR) in traffic over 20 years Continuing shift to wide-bodies 5.4% CAGR in wide-body aircraft count over 20 years 200 B747-8F required over 20 years (150 B747-8s over 10 years) ACMG Low-growth scenario 3.5% CAGR growth in traffic over 20 years 3.7% CAGR in wide-body aircraft count over 20 years 175 B747-8F required over 20 years Demand growth is concentrated in: Trans-Pacific Intra-Asia Latin America to/from U.S. and Europe Environment and Noise Regulations are becoming stricter Newer-technology aircraft will comply with emission targets Ability to operate within new noise regulation limits 31

Demand Drivers for Global ACMI Solutions World Air Cargo Growth 2008-2027 5.8% 2.7% Europe-Asia 6.5% 6.7% Intra North America 5.1% Asia - North America Europe - North America 5.6% North America - Latin America 6.2% Europe Africa 6.0% Europe SW Asia Intra Asia 8.1% Source: Boeing World Air Cargo Forecast 2008-2009 (Fall 2008). Factors driving ACMI demand include - Market Demand - Globalization - Availability of Existing Infrastructure - Customer Fleet and Organizational Limitations - Customer Network Design - Regulatory Framework 32

Global ACMI Route Map 33

Atlas Air ACMI Customer Trade Lanes World Air Cargo Growth 2008-2027 5.8% 2.7% Europe-Asia 6.5% 6.7% Intra North America 5.1% Asia - North America Europe - North America 5.6% North America - Latin America 6.2% Europe Africa 6.0% Europe SW Asia Intra Asia 8.1% Source: Boeing World Air Cargo Forecast 2008-2009 (Fall 2008). Atlas customers operate in high-growth trade lanes 34

Growing Reliance on Dedicated Freighters Global airfreight traffic is projected to grow faster than passenger traffic Freighter capacity secures forwarder commitment Incremental capacity provided by passenger jets cannot accommodate airfreight growth ATK/year (Billions) 1500 Passenger lower hold 1000 Combi Freighter 5.0% compound annual growth rate 46% 500 0 6.0% compound 50% annual 54% 2% growth rate 48% 2007 2027 Source: Boeing World Air Cargo Forecast 2008-2009 (Fall 2008). 35

ACMI Operators 747F Fleet Overview AAWW surpasses the competition with scale and new technology Number of Aircraft/Orders 60 50 40 30 B747-8F Option/Rights B747-200F B747-400 Converted Order B747-400 Converted B747-8F Order B747-400F 20 10 0 AAWW Kalitta Southern Evergreen Air Atlanta Icelandic World Sources: AAWW, Ascend. 747-200F total includes -100s and -300s. 36

Leading-Edge Technology Lowest Unit Cost Advantages of B747-400F Advantages of B747-8F Overview Fuel Efficiency Capacity & Range Design Cargo Loading Largest commercial cargo transport in service Newest commercial cargo transport Scheduled to enter service in 2010 Burns 10-16% less fuel than 747 Classics Burns 16% less than the 747-400F, achieved by an improved wing design and new engines General Electric's new GEnx engines 119 tonnes of cargo 4,400 nautical miles (Over 7% greater payload, 25% greater range than 747 Classics) More fuel-efficient engines and larger wings (versus 747 Classics) 2-crew flight deck Reduced maintenance costs for avionics and engines Improved powered cargo-handling system makes for smooth, fast loading and unloading 134 tonnes of cargo capacity 16% more payload capacity (versus 400Fs) > 1,000 NM extra range Common pilot-type rating 17% reduction in carbon emissions 30% smaller noise footprint Larger airframe increases standard pallet capacity by 7 while maintaining customerpreferred nose-door-loading capability 37

Delivering Value to Customers at All Levels Customer Management C Suite Communication and negotiations at C-level, Delivering Strategic Focus C Suite AAWW Management Customer Cargo Division Regional Commercial/ Operations organization Central coordination: both globally and regionally, ensuring optimal focus and results Global Customer Manager Regional Customer Manager Atlas Air Freighter Management Team Day-to-day operations Global Control Center Operating Teams Customer AAWW 38

AAWW Go-to-Market Approach Market Analysis Network Analysis Negotiation Implementation Supply-demand analysis Trade-lane analysis Customer analysis Network options Slot-time and regulatory analysis Aircraft solution Commercial terms and conditions Operations performance targets Scheduling Ground operations Maintenance planning Proactive focus on understanding future market demand Analyzing and targeting customers with growth potential Presenting solutions that will deliver new value to the customer Scalability and superior technology, delivering market-leading solutions 39

Our Customer Portfolio is Balanced and Strong Long-term, profitable relationships Resilient Business Model & Predictable Revenues Long-term, profitable relationships Strategic focus on cargo Growth-oriented market leaders High degree of customer integration Focus on continuous development Long-term contractual commitments 40

Uniquely Positioned for the Future Largest and best-performing 747F fleet of all air cargo operators Only ACMI operator with new technology 747-8F on order, strong customer interest Strong portfolio of long-term customers committed to further expansion Unique Integrated Value Proposition single source for an array of integrated solutions High degree of customer collaboration, enabling new growth opportunities Connecting, Leading Innovation Delivering Value for Our Stakeholders 41

Operational Update John Dietrich Executive Vice President & Chief Operating Officer

Operations - Philosophy Culture of customer focus & service quality Relentless focus on safety, security & regulatory compliance Be customer s first choice by delivering exceptional performance Hold ourselves to the highest standards Deliver against aggressive performance targets Seek continuous improvement in everything we do Be flexible to meet customer needs 43

AAWW Operates the Largest 747 Freighter Fleet 22 Boeing 747-400s (one 747-400BCF) 747-400F 7 Boeing 747 Classics On order: 12 Boeing 747-8Fs Options for additional 14 aircraft 747-200SF All GE Powered 747-8F 44

Operations Worldwide Presence Headquartered in Purchase, New York Offices throughout the globe including: Anchorage Dubai, UAE Chicago Sydney, Australia Los Angeles Incheon, Korea JFK Hong Kong Wilmington Shanghai, China Miami London/Stansted Flight Operations: Crew Bases in ANC, JFK, LAX, MIA, STN (CVG pending) Designed to maximize efficiency, minimize deadheading & travel costs 45

Global Coverage = Global Experience In 2008 AAWW operated 19,042 flights, serving 316 destinations in 110 countries 46

Global Command Center & 24/7 Operations Coverage Centralized Crew Resource, Scheduling and Coordination Customer Website International Government Affairs and Permit Support Global Maintenance Infrastructure (24/7) Centralized AOG and Parts Support Global Ground Operations Support Global Customer Support Centralized 24- Hour Systems Operations and Dispatch 47

Operations Network Scale and Scope Our global scale offers substantial value to customers: AOG and other recovery capabilities Opportunistic Charter capabilities 24 to 72 hours notice-to-operation AMC, Charter and ACMI opportunities Ground handling, warehousing and Special loads/hazmat Expedited permit/overfly authorization capabilities 48

2008 Performance & Highlights Service Reliability Performance ACMI: 6,384 Flights 97.7% vs. 96% internal target Scheduled Service: 5,026 Flights 96.3% vs. 96% internal target Polar Express: 1,692 Flights 97.9% vs. 96% internal target AMC: 1,269 Missions 89.9% vs. 85% contractual target 49

Flight Operations Training Center - Miami, FL. 50

Atlas Air is a Leader in 747 Crew Training State-of-the-Art Training Center: Four flight simulators Two 747-400 simulators (one convertible to B747-8) Two 747-200 simulators Highly experienced instructors New state-of-the-art B747-400 Full Flight Simulator convertible to B747-8 Upgraded B747-200 Full Flight Simulator with new visual system New state of the art flat panel training device supporting B747-400 & 747-8 51

Atlas Air is a Leader in 747 Crew Training The United States government selected Atlas to train pilots for the President Air Force One & E-4B Receive consistently high marks from the Air Force Recurrent training critiques support the high standards and quality of Atlas training Constantly improving training programs: Enhance learning and knowledge retention Expand use of computer-based training Streamline training programs (e.g., training to proficiency) Expanding Training Center to full Flight Ops resource center 52

Safety & Regulatory Compliance Safety & Compliance is a Top Corporate Priority IOSA (IATA Operational Safety Audit) certified in 2007 U.S. Department of Defense Consistently rated as commendable Consistently meet and exceed customer audit standards Proactive Safety Programs Flight Data Quality Management Program Active Hazard and Investigation Reporting Systems Robust Self-Inspection Programs Effective Safety Communication Program 53

Safety & Regulatory Compliance Future Safety Initiatives Next IOSA audit Fall 2009 Aviation Safety Action Program (ASAP) FAA ATOS (Air Transportation Oversight System) Working toward full conformity 54

Continuous Improvement It s a journey, not a destination Will continue to be a significant contributor to earnings improvement Continuous Improvement Outcomes Has reduced costs Improved performance and service quality Shaped more rewarding work environment Improved profitability Enhanced shareholder value In 2008, we exceeded our goal of $100 million Next-Generation Initiatives Focus on technology, processes and procedures 55

2009 Continuous Improvement Initiatives Flight Operations Electronic Flight Bag (July 2009) Automated crew planning and scheduling optimization State-of-the-art dispatch software Enhanced use of professional instructors Standardized manuals Technical Operations 747 Maintenance Optimization Programs Escalate intervals for A, C & D Checks Streamlining work on heavy checks Harvest components from retired or parked aircraft Proactive maintenance on heavy checks Standardized manuals 56

2009 Other Continuous Improvement Initiatives Vendor Management Strategic Provider Program Strict performance standards Structured performance reviews Travel Cost Improvements Inventory Management Warranty Processing Procure-to-pay Development & Planning Enhanced Customer Website 57

Labor Relations Update 647 pilots and 51 flight engineers (May 2009) Atlas: 462 pilots and 51 flight engineers Polar: 185 pilots and 0 flight engineers Atlas and Polar crewmembers are represented by the International Brotherhood of Teamsters IBT replaced ALPA in December 2008 Flexible Labor Agreement: Permits stretch of our crew resources (e.g., extended duty days) Productive labor relations Merger of crew workforces expected by end of 2009 58

Operational Summary Uncompromised commitment to safety & compliance Intense focus on the customer and service quality Continuous Improvement to drive out cost, improve operational efficiency and improve earnings growth Goals are all designed to deliver customer satisfaction and shareholder value! We are unmatched in the industry in delivering operational excellence to our customers 59

Financial Overview Jason Grant Senior Vice President & CFO

2009 A Record First Quarter Record first-quarter earnings for AAWW First clear indication of the Polar transformation As we had guided for the last 18 months EPS of $1.12 Continued our record of driving higher earnings and margins on a lower asset base Achieved in a challenging environment 61

2009 A Record First Quarter (continued) AMC demand was strong Afghanistan activity drove higher activity than previously expected Right-sized the B747-200 fleet Seven operating aircraft at the end of Q1 2009 versus 17 at the beginning of 2008 Managed overhead effectively Continuous Improvement efforts reduced costs Hotel and ground transportation, airport handling fees 62

Deconsolidation of Polar for Reporting Simplifies reporting lower revenue & expenses - profit is unchanged Indicative Amounts Polar Polar Average ACMI $ Per Block Hour Consolidated De-Consolidated Economics/BH Pre-Oct'08 Post-Oct'08 (1Q09 10-Q) Sched. Service ACMI Format Format Revenue Total Revenue $16,000 $6,000 ACMI Revenue 6,000 6,000 Non-ACMI Revenue 10,000 0 Costs ACMI $4,620 $4,620 Non-ACMI Costs 10,000 0 Fuel 7,000 0 Ground Handling 1,500 0 Airport & Nav Fees 1,000 0 Distribution Costs 500 0 Total Costs $14,620 $4,620 Direct Contribution after Own. $1,380 $1,380 DCAO Margin 8.6% 23.0% * 63 Average ACMI Segment DCAO margin from 1Q09 AAWW Form 10-Q.

Is Reflected in Higher ACMI Segment Profits 4Q08 (Nov/Dec) and 1Q09 reflect higher ACMI contribution from transformation and reclassification of segment profits due to Polar transformation Consolidation of GSS (49% sub) in 2Q09 will drive further reclassification from Dry Leasing to ACMI segment 40 35 30 25 20 15 10 5 0 ACMI Direct Contribution ($ Mil) Impact of Polar Transformation 2007 2008 2009 Q1 Q2 Q3 Q4 64

Strong Balance Sheet & Liquidity Limited debt maturity: No near-term balloon or refinancing requirements $672 $655 $583 PDP Debt $306 $232 $477 $411 $442 $419 $394 $217 $217 $455 $438 2005 2006 2007 2008 1Q09 2005 2006 2007 2008 1Q09 Cash Balance ($ Mil) Balance Sheet Debt ($ Mil) 65

Focused Approach to De-Risking the Business Limited direct fuel exposure - ACMI customers cover fuel, AMC is cost-plus Long-term contracts mitigate quarter-to-quarter volatility ACMI typically has 3- to 5-year contracts, DHL commitment is longer 90%+ of our Block Hours are now generated by long-term or fixedprice contracts in 1Q09 Focused on high-credit-quality customers where freight is meaningful to their overall revenue and profits FY '08 Revenue ($ Mil) Total Freight Freight % Emirates $9,926 $1,638 16.5% British Airways 12,674 892 7.0% Qantas 11,287 660 5.8% American Airlines $23,696 $874 3.7% Continental 15,241 497 3.3% 66

Focused Approach to De-Risking the Business AMC demand has low correlation to commercial demand Older Classic fleet is unencumbered and managed opportunistically Continuous Improvement and cost reduction: $100M+ achieved already Lead times, scale and capital requirements limit competitive threats AAWW: Only outsource operator of scale with 400Fs and only one with -8Fs on order 67

Earnings Growth on a Reduced Asset Base Through Continuous Improvement and focused asset-allocation choices, we have grown earnings on a reduced asset base despite high operational leverage Fleet Count (End of Period) Direct Contribution/BH (ex. Scheduled Service) $3,500 37 33 29 $3,000 17 11 7 B747-200s $2,500 20 22 22 B747-400s $2,000 $1,500 2007 2008 2009 2007 2008 Q1 '09 $1,000 Q1 Q2 Q3 Q4 YOY % Change (11%) (12%) 68

The 747-8F Will Lead the Market Like the 747-400F before it, the 747-8F will be the market-leading freighter platform 16% lower cash operating cost per tonne mile than the 400F, 2.7% lower than the 777F 5.5% lower total cost per ton mile versus the 777F 132% Relative Direct Operating Cost Tonne Mile Cost Comparison 100% Relative DOC and Ownership Tonne Mile Cost Comparison DOC % cost difference 109% 100% 87% 84% % cost difference (2.7%) Own (2.8%) 94.5% 777-200ERF 747-8F Source: AAWW Estimates 747-200SF 747-400SF 747-400F 777-200ERF 747-8F Source: Boeing U.S. freighter rules. 3,000-nmi trip. Fuel price, $2.11 per U.S. gallon. 69

The 747-8F A Compelling ACMI Platform In contrast to the 747-400F, the limited size of the 747-8 global passenger fleet will significantly enhance the value proposition of the 747-8F as an ACMI platform Without an installed base of passenger B747-8 aircraft to leverage internal economies of scale, airlines are more likely to seek ACMI freighter solutions to access Atlas economies of scale Global 747-400 Fleet 747-8F Orders 421 78 221 20 747-400PAX Source: Ascend (April 2009) Freighter fleet excludes parked aircraft 747-400F/SF Operators: 42 35 747-8PAX 747-8F 1 8 Source: Boeing 747-8 PAX orders excludes business jets 70

747-8F Financing Strategy Delivery schedule still in negotiation AAWW has funded $313M in PDPs to date $96M funded through equity $217M financed Will look to source remaining financing for PDPs in 2H09/1Q10 Permanent financing Firm commitment for Sale-Leaseback financing on 4 aircraft Financing efforts focused in 1H10 71

Wrap Up Bill Flynn President & CEO

Your Questions Questions and Answers 74

Delivering Growth in a Challenging Market. AAWW Analyst and Investor Day May 12, 2009