1

1

Annual Meeting of Shareholders

May 11, 2010

Exhibit 99.1

2

2

Safe Harbor

Except

for

historical

information

contained

herein,

the

matters

discussed

in

this

presentation

contain

forward-looking

statements

that

involve

risks

and

uncertainties.

There

are

a

number

of

important

factors

that

could

cause

Air

Transport

Services

Group's

("ATSG's")

actual

results

to

differ

materially

from

those

indicated

by

such

forward-looking

statements.

These

factors

include,

but

are

not

limited

to,

changes

in

market

demand

for

our

assets

and

services,

the

timely

completion

of

767

freighter

modifications

as

anticipated

under

ABX

Air’s

new

operating

agreement

with

DHL,

ABX

Air’s

ability

to

maintain

on-time

service

and

control

costs

under

its

new

operating

agreement

with

DHL,

and

other

factors

that

are

contained

from

time

to

time

in

ATSG's

filings

with

the

U.S.

Securities

and

Exchange

Commission,

including

its

Annual

Report

on

Form

10-K

and

Quarterly

Reports

on

Form

10-Q.

Readers

should

carefully

review

this

presentation

and

should

not

place

undue

reliance

on

ATSG's

forward-looking

statements.

These

forward-looking

statements

were

based

on

information,

plans

and

estimates

as

of

the

date

of

this

release.

ATSG

undertakes

no

obligation

to

update

any

forward-looking

statements

to

reflect

changes

in

underlying

assumptions

or

factors,

new

information,

future

events

or

other

changes.

ATSG, Inc. Non-GAAP Reconciliation

Earnings from Continuing Operations Before Interest, Taxes, Depreciation, and Amortization (Adjusted EBITDA)

(Unaudited)

EBITDA

and

Adjusted

EBITDA

are

non-GAAP

financial

measures

and

should

not

be

considered

alternatives

to

net

income

(loss)

or

any

other

performance

measure

derived

in

accordance

with

GAAP.

EBITDA

is

defined

as

income

(loss)

from

operations

plus

net

interest

expense,

provision

for

income

taxes,

depreciation

and

amortization.

The

Company’s

management

uses

these

adjusted

financial

measures

in

conjunction

with

GAAP

finance

measures

to

monitor

and

evaluate

its

performance,

including

as

a

measure

of

liquidity.

EBITDA

and

Adjusted

EBITDA

should

not

be

considered

in

isolation

or

as

a

substitute

for

analysis

of

the

Company’s

results

as

reported

under

GAAP,

or

as

alternative

measures

of

liquidity.

2007

 2008

2009

1Q2009

1Q2010

25,721

(56,619)

45,358

13,193

10,784

Impairment of goodwill & intangibles

0

91,241

0

0

0

25,721

34,622

45,358

13,193

10,784

Interest Income

(4,557)

(2,335)

(449)

-178

-73

Interest Expense

14,067

37,002

26,881

7,646

5,189

Depreciation and amortization

51,635

93,752

83,964

21,473

20,800

86,866

163,041

155,754

42,134

36,700

GAAP Pre-tax Earnings (Loss)

Reconciliation Statement ($ in 000s)

Adjusted EBITDA from Cont. Oper.

from Continuing Operations

Adjusted Pre-Tax Earnings                  

from Continuing Operations

3

3

2009 in Review

2009 Financial Results &

Balance Sheet Improvement

2010 Focus

Goals

DHL Agreements

767 Conversion Program

Marketing Strategy

Wrap-up & Your Questions

Agenda

Joe Hete

President & Chief Executive Officer

Quint Turner

Chief Financial Officer

Joe Hete

President & Chief Executive Officer

Rich Corrado

Chief Commercial Officer

Joe Hete

President & Chief Executive Officer

4

4

2009 Goals and Achievements

Achievements

Note balance reduced, capital leases

transferred to DHL

Superior service quality maintained

767 mod program on track; 4 completed

by year-end 2009

Framework established with DHL to

lease 13 767s, CAM leases 3 others

Long-term debt reduced $135M, post-

retirement obligations down $145M

AMES established in May 2009

ABX Air pilots approve new CBA,

reduced overhead costs by $21M

Goals

Restructure DHL promissory note

and capital leases

Continue to support DHL transition

Reconfigure non-standard B767PC

fleet to serve broad customer base

Seek long-term commitments for

B767 fleet

Further strengthen balance sheet

Leverage maintenance capability

Align cost structure

5

5

Financial Results &

Balance Sheet Improvement

Quint Turner, CFO

6

6

2009 Financial Performance

Annual Results

$ in millions

Non-DHL

DHL ACMI

DHL S&R Agreement

Revenues

from Continuing Operations

$451.4

2008

$941.7

$823.5

$29.1

$29.1

2009

$419.3

$282.8

$121.4

$121.4

$461.2

Pre-tax Earnings

From Continuing Operations

2008

$45.4

2009

$34.6*

* Excluding goodwill and intangible impairment charges

-$56.6

7

7

2009 Results –

DHL Segment

*

* From continuing operations

2008

2009

2008

2009

Revenues

Pre-tax Earnings

Block hours down 78% as DHL

converted U.S. to international-

only service in January 2009

Severance & retention includes

gains on pilot S&R, vacation

reimbursement.

Excludes discontinued operations

(Hub Services and fuel)

$282.8

$451.4

$121.4

$29.1

$404.2

$480.5

$11.2

$13.6

$16.7

$27.9

$14.4

$0.8

ACMI

S&R

$ in millions

8

8

2009 Results –

ACMI Services

*

* Earnings include intangible charges totaling $91.2 million pre-tax for goodwill, customer intangibles

2008

2009

Revenues

Pre-tax Earnings

11% increase in block hours

reflect additional 767s in service

Fuel costs down 42%, lowering

reimbursement revenues

ABX Air ACMI losses, including

transatlantic scheduled service

$289.5

$292.8

$75.2

$128.2

$0.5

$7.1

$364.7

$421.0

2008

2009

Fuel & other Reimbursable

ACMI

Impairment charges

-$84.1

-$91.2

$ in millions

9

9

2009 Results –

CAM

2008

2009

2008

2009

Revenues

Pre-tax Earnings

Eight 767 aircraft added during

2009

767 conversion program on

track with seven of 14 now

completed or in mod

Amerijet leases in March first of

two 767s including certification,

pilot training, maintenance, etc.

$47.5

$60.7

$18.1

$22.8

$ in millions

10

10

Adjusted EBITDA

from Continuing Operations

*

2007

$86.9

$94.5 M

*Adjusted

EBITDA

from

Continuing

Operations

is

a

non-GAAP

financial

measure

and

should

not

be

considered

as

an

alternative

to

net

income

(loss)

or

any

other

performance

measure

derived

in

accordance

with

GAAP.

2008

amounts

exclude

impairment

charges

totaling

$91.2

million

related

to

goodwill

and

customer

intangibles.

Please

refer

to

Slide

2

for

a

statement

showing

a

reconciliation

of

Adjusted

EBITDA

from

Continuing

Operations

to

GAAP

Net

Income."

$163.0

2008

2009

$155.8

$ in millions

11

11

Total Debt declines $135 Million

Transfer of

Transfer of

Aircraft Capital

Aircraft Capital

Leases to DHL

Leases to DHL

$46.3

$43.1

Principal

Principal

payments

payments

$377.4

$512.5

$45.7

DHL Promissory

DHL Promissory

Note

Note

Extinguishment

Extinguishment

$ in millions

YE

2008

YE

2009

12

12

Post-retirement obligations

decline $145 million

$152.7

$297.3

Actuarial

Actuarial

costs &

costs &

adjustments

adjustments

$83.2

$75.8

$71.7

Employer

Employer

contributions

contributions

Workforce

Workforce

contraction

contraction

& plan freeze

& plan freeze

$57.3

$ in millions

YE

2008

YE

2009

Gains on

Gains on

assets

assets

13

13

First Quarter 2010 Results

Revenues

Earnings

DHL

$  48,487

DHL

$ 8,283

ACMI Services

98,226

ACMI Services

(900)

CAM

17,802

CAM

6,539

Other

17,453

Other

(1,336)

Eliminations

(21,024)

Interest

(1,802)

Total-

Cont. Oper.

$ 160,944

Pretax Earnings–Cont. Oper.

$ 10,784

Income Taxes

(4,034)

Net Earnings-Cont. Oper.

$6,750

Net Earnings-Discont. Oper.

405

Net Earnings

$7,155

$ in thousands

14

14

First Quarter 2010 vs. 2009

$ in millions

Revenues

from Continuing Operations

2009

2010

Non-DHL & Intercompany

DHL ACMI

Pre-tax Earnings

from Continuing Operations

$211.8

$160.9

$94.3

$19.2

$112.4

$44.5

2009

2010

$13.2

$10.8

$3.6

$5.1

$2.5

$4.8

$4.5

$3.5

Severance & Retention

$98.2

$4.0

42.1

36.3

EBITDA

from Continuing Operations

2009

2010

$42.1

$36.7

15

15

2010

Focus

16

16

Plotting A Course For Growth

2010 Goals

Execute and deliver results against new DHL Agreements

Continue 767 conversions, deploy all freighters under long-term

agreements

Further strengthen balance sheet

Leverage complementary service offerings in global marketing

strategy

Capture cost and workforce flexibility advantages from ABX CBA,

AMES platform

Strategically invest for growth and further diversification

17

17

DHL Agreements

18

18

New A+CMI Agreements with DHL

New

“A+CMI”

Agreement

Terms

DHL

leasing

thirteen

767

aircraft

from

CAM

under

seven-year

terms,

unlocking

market

value

of

assets

ABX

to

operate

aircraft

for

DHL

under

separate

five-year

CMI

agreement,

with

two-year

extension

right

to

DHL

Economics

based

upon

pre-defined

fee,

scalable

for

number

of

aircraft

operated

by

ABX,

with

performance

incentive

bonuses

CMI

agreement

subject

to

break-up

fee

should

DHL

elect

to

prematurely

terminate

Under

the

CMI,

ABX

contracts

with

AMES

for

airframe

heavy

maintenance,

reimbursable

by

DHL

under

lease

agreements

The

remaining

$31M

in

the

DHL

Note

will

amortize

over

five-year

term

of

the

CMI

with

no

cash

requirement

from

ATSG;

interest

expense

continues

to

be

reimbursed

Other

Issues

Resolved

DHL

agreed

to

pay

ABX

$31M

to

settle

DC-9

and

Boeing

767

aircraft

put

values

DHL

agreed

to

remit

$11.2M

in

May

to

settle

the

reimbursement

of

accrued

vacation

paid

to

employees

adversely

impacted

by

DHL’s

restructuring

19

19

767 Conversion Program

20

20

Deploying Our 767SFs

11-14

11-18

April 2011

Jan. 2012

DHL-CAM Leased SFs

Other Customers-CAM Leased SFs

11-14

11

Jan. 2011

4

Pace of 767 modifications could be affected by possible assignment of modification slots to DHL.

7

11

April 2010

DHL-

Interim Leased SFs

ACMI

Services

–

ACMI/Charter

SFs

13

13

4

5-8

5-8

5-12

26

30

32

36

21

21

767 Advantages vs. Aging Fleets

Aircraft

Fuel (gal./

block hr)

Crew

Payload (lbs.)/

Capacity (cu.ft.)

Range

(NM)

767-200SF

1,380

2

100,000 / 11,138

2,800

A300-B4

1,900

3

99,200 / 11,445

1,680

DC-8 63

1,760

3

96,800 / 10,060

2,150

DC-8 73

1,600

3

111,800 / 10,060

2,470

22

22

Marketing Strategy

Rich Corrado, Chief Commercial Officer

23

23

Emerging Go-to-Market Strategy

Drive higher return on capital by

optimally positioning opportunities and

bundling

additional services

CAM a neutral, non-airline, lead sales

organization that can drive a bundled

marketing strategy

Develop packaged programs cross-

selling entities

Amerijet

International program

symbolizes this approach

Market Approach

Market Opportunities

767 ideal replacement

for less efficient aircraft

A300-B4 (47)

DC-10-10 (59)

DC-8 (55)

Growth markets

Domestic China-9.3%

Intra-Asia-7.5%

Europe-Asia-5.9%

Europe-Africa-5.7%

Source: ACMG, Boeing

24

24

ATSG Portfolio Marketing

Individual companies continue to market and sell their own services

CAM

will

bundle

and

sell

the

services

of

the

individual

companies

into

short-

and

long-term

solutions

for

new

and

existing

customers

•

ACMI / Wet Leasing

•

Cargo Handling

•

Charter Services

•

ACMI / Wet Leasing

•

Combi-freighters

•

Charter Services

•

ACMI / Wet Leasing

•

Charter Services

•

Aviation Solutions

•

Bundled Programs

•

Aircraft Leasing

•

Conversion Services

•

Heavy Maintenance

•

Line Maintenance

•

Component Overhaul & Sales

•

Engineering Services

25

25

Flexible

Global

Solutions

Market Differentiation

•

767-200 with

GE CF6-80A

engines

•

Low fuel cost

•

Low

maintenance

cost

•

Flexible

configuration

•

Power By Hour

engine services

The Global Leader of Medium Wide Body Operating and Leasing Solutions

Efficient Medium

Wide-Body

Aircraft

•

ACMI/wet leasing

•

CMI

•

Dry leasing

•

AMC charter

•

Full service

charter

•

Flight operations

•

Heavy

maintenance

•

Line

maintenance

•

Maintenance

programs

•

Engineering

•

Technical

support

•

Manual services

•

Parts,

components

sales & service

•

Aircraft

conversion

services

•

Global aircraft

deployment

•

Logistics

support

•

DHL

•

TNT

•

UPS

•

Qantas

•

Amerijet

•

Air

Mobility

Command

•

CargoJet

Bundled

Maintenance

Solutions

Program

Management

Diverse

Customer

Experience

26

26

Wrap-up and Your Questions

Joe Hete, President & CEO

27

27

2010 Achievements to Date

Completed new fixed-price, multi-year agreements for aircraft

leasing and CMI services with DHL

Continued to reduce debt and strengthen balance sheet

Leased 767F to Amerijet, illustrating ATSG’s complementary

solutions opportunity

Restructured and expanded TNT relationship into lower-risk ACMI

for two aircraft

Took delivery of three more 767Fs from mod

Completed restructuring of ABX Air

Placed deposits for three 767-300s

28

28

Value Proposition

Strong cash returns from modified freighters

767 leases lock in long-term cash flow

ACMI/CMI flexibility provides lease migration path

10 modified 767 freighters to be deployed through 2011

Long-term agreements with well-established customers

Lease/CMI provides entry point for expanded opportunities

Integrated, value-added services

Solid balance sheet and liquidity, growth capital capacity

Well positioned for continued growth in global air cargo

demand

The Global Leader of Medium Wide-Body Operating & Leasing Solutions

29

29

Investors Recognize ATSG Progress

ATSG

NASDAQ Transportation (IXTR)

May 11, 2009

May 10, 2010

$0.77

$5.36

2155

1789

Values at close

30

30

Shareholder Questions