Atlas Air Redeems $100 Million of 12.25% Notes.

GOLDEN, Colo.--(BUSINESS WIRE)--Jan. 19, 1999--Atlas Air, Inc. (NYSE:CGO) announced today that it redeemed in full its 12.25% senior secured notes due December 1, 2002 at a redemption price of 108.00% of principal, plus accrued interest to January 19, 1999.

"The redemption of this debt is another positive move towards improving Atlas Air's balance sheet and reducing costs," said Stephen C. Nevin, Chief Financial Officer. "Three Boeing 747-200 freighter aircraft that were secured by these notes will be released from such encumbrances and Atlas will save in excess of $12.2 million per annum of associated interest expense."

The Company expects this early debt redemption to result in a first quarter 1999 non-recurring net after-tax extraordinary charge of approximately $6.6 million, or approximately 20 cents per fully diluted share, adjusted for a 3-for-2 stock split previously announced by the Company for stockholders of record on January 25, 1999.

As previously announced, the Company also said that, in accordance with the Accounting Standards Executive Committee ("AcSec") issued Statement of Position (SOP) 98-5 entitled "Reporting on the Costs of Start-up Activities", Atlas Air, Inc. will record in the first quarter of 1999 an additional non-recurring net after-tax charge of approximately $1.5 million, or approximately 4 cents per fully diluted share adjusted for the 3-for-2 stock split as noted above. This charge reflects the cumulative effect of the change in accounting principle related to the write-off of the unamortized balance of start-up costs associated with the introduction of its new B747-400F aircraft.

"SOP 98-5 is a change in accounting rules that affects all companies that have capitalized any start-up costs," said Nevin. "As Atlas has been conservative in the amount of start-up costs that we have capitalized to date, the impact of this rule change has been minimized in this one-time non-operating charge for the period."

"None of these non-recurring charges should have an impact on analyst's earnings estimates for either the first quarter or full year 1999," said Nevin. "We continue to be on track for our earnings expectations for this year."

Atlas Air, Inc. is a United States certificated air carrier that operates a fleet of 747 freighters under long-term ACMI contracts. These contracts include the provision by Atlas of Aircraft, Crew, Maintenance and Insurance for some of the world's leading air carriers, including Alitalia, British Airways, Cargolux, China Airlines, El Al, Emirates, Fast Air, FedEx, Iberia, LAS, SAS and Thai International Airways, serving a total of 76 cities in 42 countries.