FOOL CONFERENCE CALL SYNOPSIS*
By Greg Markus (TMF Boring)

Atlas Air Inc.
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538 Commons Dr.
Golden, CO 80401
(303) 526-5050

ANN ARBOR, Mich. (April 24, 1997) -- Atlas Air is a U.S. certificated air carrier that operates a fleet of 747 freighters under long-term contracts with commercial air carriers including British Airways, China Airlines, Cargolux, Emirates, FastAir, KLM, LAS, Lufthansa, SAS, Thai International Airways, and Varig, serving 62 cities in 38 countries. Under these contracts, Atlas provides the aircraft, crew, maintenance and insurance; fuel costs are borne by the customer.

Atlas Air reported today that it earned $5.8 million, or $0.26 per share, for the quarter ended March 31, 1997. Including a non-recurring charge associated with returning two aircraft, net earnings were $5.0 million, or $0.22 per share. Revenues of $82.0 million represented a 40% increase over the $58.6 million in revenues for the year-earlier period. Earnings were below the $0.32 per share of a year ago due to the comparatively greater number of seasonal cancellations by certain customers in the first quarter of 1997, as discussed below.

IMPACT OF CHINESE NEW YEAR

Atlas permits its customers to cancel a limited number of annual hours, which customers typically utilize in either the first of fourth quarter. This year, customers opted to take their cancellations in the first quarter due to the timing of Chinese New Year in the lunar calendar. A majority of Atlas's business involves flights from Asia, and factory production falls off significantly during the time of Chinese New Year celebrations. Because so many customers elected to take their cancellations in the first quarter, that should have a positive impact on the 1997 fourth quarter, as relatively few cancellation privileges will then be available.

FINANCIAL POSITION

The company's financial position continues to be very strong. Atlas ended the quarter with $123 million in cash, in addition to a $275 million revolving aircraft acquisition facility, which was increased by $100 million during the quarter. Furthermore, Standard & Poor's and Moody's have announced their intentions to review Atlas's debt rating for a possible upgrade.

Interest income for the quarter was approximately $2 million and interest expense was approximately $11.2 million. More detailed financial information will be available in a few days.

Internal cost controls together with the spread of fixed costs across a growing fleet size is reducing total costs relative to revenues.

AIRCRAFT LEASED FROM FEDERAL EXPRESS

Costs associated with the operation of five aircraft leased from Federal Express have been above the average for Atlas's fleet. Atlas Air continues to be cautious about projecting operating costs associated with the Fed Ex aircraft, but based on the experience in the first quarter, those costs appear to be coming down.

The last of the five planes leased from Federal Express entered service for Atlas during the current (second) quarter, and the decision was made to use that aircraft as a spare to support the current contract fleet. That decision reflects the fact that another aircraft the company had been utilizing as a backup was returned to the lessor at the beginning of the first quarter. It is difficult to maintain reliability of service without a spare unit to call into service when contracted aircraft are undergoing scheduled maintenance or when Atlas or its customers experience any unscheduled maintenance events. Additionally, the spare aircraft can be used on a short-notice basis for charters and can be offered to customers to assist with any special needs they require beyond what they have contracted for.

The five Federal Express were the only suitable aircraft available at the time, and so Atlas Air made the decision to acquire them. Despite the increased operating costs associated with those aircraft, that was probably the right decision in retrospect. It enabled Atlas to gain market share that the company could not have gotten otherwise, particularly in the rapidly growing South American market. Going forward, the company has in place extensive due diligence procedures for evaluating additional aircraft that may be acquired.

FLEET EXPANSION

The lease for the five Fed-Ex aircraft expires in January 1998. Atlas Air has not yet made a decision about whether it will renew that lease or return the aircraft. If those aircraft should come off lease, management is confident that the company will have four to five net additional units for growth in 1998. Atlas Air has a purchasing power and financial situation that puts it at a considerable advantage to its competitors in acquiring new aircraft for sale or lease. Atlas is the buyer of first choice for most sellers.

The company has made no decision yet on whether it will purchase new 747-400 aircraft. Although those aircraft appear to have certain advantages for selected routes, the final decision must be one that is economically favorable to the company.

GUIDANCE

SECOND QUARTER. Because of the decision to use the fifth Federal Express aircraft as a backup rather than place it into contract service, the average number aircraft operating in the current quarter will be closer to 18.0 rather than the previous estimate of 18.7, depending on where the aircraft are used. In terms of block hours, the company is estimating 18,000 block hours for the second quarter, which is an adjustment from the approximate 18,500 block hours that had been projected previously [or approximately a 2.8% revision]. The average block hours generated by an aircraft is approximately 350 per month, or approximately 1,000 per quarter. Atlas does not provide specific guidance on revenues and earnings, but a small revision downward in block hours for Q2 should be considered alongside a trend of declining costs.

BALANCE OF 1997. Previous projections for the second half of 1997 were 19,000 to 20,000 block hours for Q3 and 21,000 to 22,000 for Q4. Atlas has not updated those estimates yet because the final figures will depend on the specific timing of when newly acquired aircraft are put into service during the balance of the year. Two aircraft have entered service in the current quarter (including the fifth Fed Ex aircraft). Another unit is scheduled to enter service in Q3 and two more in Q4. One of the aircraft to be delivered in Q4 is already committed to a new contract with China Airlines.

DEMAND FOR SERVICES. Demand for air freight services continues to be very good. In the Asian market, demand remains very strong, as evidenced by the fact that China Airlines has signed up with Atlas for an additional aircraft to be operated this year. The South American market is another area of strong demand.

* A Fool conference call synopsis represents an effort to highlight the salient points of a conference call and should not be taken as an authoritative accounting or transcription of the entire event. Note: Statements made by a company other than historical information may constitute forward-looking statements for which the company can claim protection under the Safe Harbor Act. Please consult the company's filings with the SEC for information on risk factors which might cause actual results to differ materially from the information contained in these forward-looking statements.