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UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549FORM 10-Q

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended June 30, 2002

[   ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Transition Period From  to

Commission file number 0-25732

(ATLAS AIR LOGO)

Atlas Air, Inc.

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|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 84-1207329                          
|                                                               |  |                                     
|(State or other jurisdiction
of incorporation or organization) |  | (I.R.S. Employer Identification No.)
|                                                               |  |                                     
|2000 Westchester Ave.
Purchase, NY                             |  | 10577                               
|                                                               |  |                                     
|(Address of principal executive offices)                       |  | (Zip Code)                          

Registrants telephone number, including area code (914) 701-8000

Not Applicable

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [   ].

Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.

As of July 18, 2002, Atlas Air, Inc. had 100 shares of $.01 par value Common Stock outstanding.
All shares are held by Atlas Air Worldwide Holdings, Inc.

This report is available online at www.atlasair.com.



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TABLE OF CONTENTS



|                              |                                                                                               |                                                      |  |  |  |  |  | 
|----------------------------- | --------------------------------------------------------------------------------------------- | ---------------------------------------------------- |  |  |  |  |  | 
|PART I. FINANCIAL INFORMATION
|                              | Item 1. Financial Statements                                                                 
|                              |                                                                                               | CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS     
|                              |                                                                                               | CONDENSED CONSOLIDATED BALANCE SHEETS               
|                              |                                                                                               | CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS     
|                              |                                                                                               | NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
|                              | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                              | Item 3. Quantitative and Qualitative Disclosures about Market Risk                           
|PART II. OTHER INFORMATION   
|                              | Item 6. Exhibits and Reports on Form 8-K.                                                    
|Signature                    



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##### Table of Contents



ATLAS AIR, INC. AND SUBSIDIARIES

INDEX

|                              |                                                                                               |                                                                                                           |  |      |    | 
|----------------------------- | --------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------- |  | ---- | -- | 
|                              |                                                                                               |                                                                                                           |  | Page
|                              |                                                                                               |                                                                                                           |  |     
|PART I. FINANCIAL INFORMATION |                                                                                               |                                                                                                           |  |     
|                              | Item 1. Condensed Consolidated Financial Statements                                           |                                                                                                           |  |      |   
|                              |                                                                                               | Condensed Consolidated Statements of Operations-
Three Months and Six Months Ended June 30, 2002 and 2001 |  |      | 3  | 
|                              |                                                                                               | Condensed Consolidated Balance Sheets-
June 30, 2002 and December 31, 2001                                |  |      | 4  | 
|                              |                                                                                               | Condensed Consolidated Statements of Cash Flows-
Six Months Ended June 30, 2002 and 2001                  |  |      | 5  | 
|                              |                                                                                               | Notes to Condensed Consolidated Financial Statements                                                      |  |      | 6  | 
|                              | Item 2. Managements Discussion and Analysis of Financial
Condition and Results of Operations |                                                                                                           |  | 8    |   
|                              | Item 3. Quantitative and Qualitative Disclosures About
Market Risk                            |                                                                                                           |  | 14   |   
|PART II. OTHER INFORMATION    |                                                                                               |                                                                                                           |  |     
|                              | Item 6. Exhibits and Reports on Form 8-K                                                      |                                                                                                           |  | 15   |   
|                              |                                                                                               | Signature                                                                                                 |  |      | 16 | 





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##### Table of Contents






PART I. FINANCIAL INFORMATION




Item 1. Financial Statements




Atlas Air, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) (In thousands)

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|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |         |         |         | 
|-------------------------------------------------------------------------------------------- | ---------------------------------- | ------------------------ | ------------------------ | ------- | ------------------ | ------- | ---------------- | ------- | ------- | ------- | ------- | ------- | ------- | ------- | ------- | ------- | ------- | ------- | 
|                                                                                             |                                    |                          |                          |         | Three Months Ended |         | Six Months Ended
|                                                                                             |                                    |                          |                          |         | June 30,           |         | June 30,        
|                                                                                             |                                    |                          |                          |         |                    |         |                 
|                                                                                             |                                    |                          |                          |         | 2002               |         | 2001             |         | 2002    |         | 2001   
|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |        
|Revenues                                                                                     |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|                                                                                             | Contracted services                |                          | $                        | 114,393 |                    |         | $                | 144,507 |         |         | $       | 222,628 |         |         | $       | 305,155 |        
|                                                                                             | Charter services                   |                          |                          | 25,220  |                    |         |                  | 2,313   |         |         |         | 65,314  |         |         |         | 5,363   |        
|                                                                                             | Other revenues                     |                          |                          | 1,564   |                    |         |                  | 2,215   |         |         |         | 4,213   |         |         |         | 18,829  |        
|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|                                                                                             |                                    |                          | Total operating revenues |         |                    | 141,177 |                  |         |         | 149,035 |         |         |         | 292,155 |         |         |         | 329,347 | 
|Expenses                                                                                     |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|                                                                                             | Salaries, wages and benefits       |                          |                          | 27,173  |                    |         |                  | 26,863  |         |         |         | 53,944  |         |         |         | 57,022  |        
|                                                                                             | Aircraft rents                     |                          |                          | 36,584  |                    |         |                  | 31,035  |         |         |         | 68,406  |         |         |         | 62,421  |        
|                                                                                             | Depreciation and amortization      |                          |                          | 20,295  |                    |         |                  | 20,469  |         |         |         | 41,602  |         |         |         | 40,655  |        
|                                                                                             | Ground handling and airport fees   |                          |                          | 9,720   |                    |         |                  | 4,386   |         |         |         | 16,195  |         |         |         | 8,341   |        
|                                                                                             | Maintenance, materials and repairs |                          |                          | 39,039  |                    |         |                  | 32,247  |         |         |         | 74,873  |         |         |         | 61,655  |        
|                                                                                             | Aircraft fuel                      |                          |                          | 11,296  |                    |         |                  | 2,234   |         |         |         | 18,373  |         |         |         | 5,070   |        
|                                                                                             | Pilot profit sharing settlement    |                          |                          |        |                    |         |                  |        |         |         |         |        |         |         |         | 22,815  |        
|                                                                                             | Restructuring and impairment       |                          |                          | 7,850   |                    |         |                  | 71,214  |         |         |         | 7,850   |         |         |         | 71,214  |        
|                                                                                             | Other operating expenses           |                          |                          | 22,554  |                    |         |                  | 32,499  |         |         |         | 44,757  |         |         |         | 56,701  |        
|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|                                                                                             |                                    | Total operating expenses |                          |         | 174,511            |         |                  |         | 220,947 |         |         |         | 326,000 |         |         |         | 385,894 |        
|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|Operating loss                                                                               |                                    |                          | (33,334                  | )       |                    |         | (71,912          | )       |         |         | (33,845 | )       |         |         | (56,547 | )      
|Other Income (Expense)                                                                       |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|                                                                                             | Interest income                    |                          |                          | 2,750   |                    |         |                  | 5,187   |         |         |         | 6,039   |         |         |         | 12,821  |        
|                                                                                             | Interest expense                   |                          |                          | (18,651 | )                  |         |                  | (24,271 | )       |         |         | (43,244 | )       |         |         | (49,648 | )      
|                                                                                             | Interest capitalized               |                          |                          | 2,266   |                    |         |                  | 3,328   |         |         |         | 4,723   |         |         |         | 6,191   |        
|                                                                                             | Change in hedge fair value         |                          |                          | (871    | )                  |         |                  | 41      |         |         |         | 497     |         |         |         | (2,020  | )      
|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|                                                                                             |                                    |                          | (14,506                  | )       |                    |         | (15,715          | )       |         |         | (31,985 | )       |         |         | (32,656 | )      
|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|Loss before income taxes and cumulative effect
of a change in accounting principle           |                                    |                          | (47,840                  | )       |                    |         | (87,627          | )       |         |         | (65,830 | )       |         |         | (89,203 | )      
|Income tax benefit                                                                           |                                    |                          | (17,965                  | )       |                    |         | (38,605          | )       |         |         | (24,884 | )       |         |         | (40,188 | )      
|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|Loss before cumulative effect of a change in
accounting principle                            |                                    |                          | (29,875                  | )       |                    |         | (49,022          | )       |         |         | (40,946 | )       |         |         | (49,015 | )      
|Cumulative effect of a change in accounting
principle, net of applicable tax benefit of $933 |                                    |                          |                         |         |                    |         |                 |         |         |         |        |         |         |         | (1,589  | )      
|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        
|Net Loss                                                                                     |                                    | $                        | (29,875                  | )       |                    | $       | (49,022          | )       |         | $       | (40,946 | )       |         | $       | (50,604 | )      
|                                                                                             |                                    |                          |                          |         |                    |         |                  |         |         |         |         |         |         |         |         |        

The accompanying notes are an integral part of these financial statements.

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Atlas Air, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (In thousands, except share amounts)

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|                       |                                                                                            |                           |                            |                                            |         |          |           |              |         |         |           | 
|---------------------- | ------------------------------------------------------------------------------------------ | ------------------------- | -------------------------- | ------------------------------------------ | ------- | -------- | --------- | ------------ | ------- | ------- | --------- | 
|                       |                                                                                            |                           |                            |                                            |         | June 30, |           | December 31,
|                       |                                                                                            |                           |                            |                                            |         | 2002     |           | 2001        
|                       |                                                                                            |                           |                            |                                            |         |          |           |             
|                       |                                                                                            |                           |                            | Assets                                     |         |          |           |              |         |         |           | 
|Current Assets         |                                                                                            |                           |                            |                                            |         |          |           |             
|                       | Cash and cash equivalents                                                                  |                           | $                          | 156,911                                    |         |          | $         | 199,270      |        
|                       | Short-term investments                                                                     |                           |                            | 99,816                                     |         |          |           | 112,634      |        
|                       | Accounts receivable, (net of allowance of $26,903 and $19,060
respectively)                |                           |                            | 102,725                                    |         |          |           | 119,303      |        
|                       | Due from affiliates                                                                        |                           |                            | 38,961                                     |         |          |           | 28,873       |        
|                       | Income taxes receivable                                                                    |                           |                            |                                           |         |          |           | 23,848       |        
|                       | Prepaid expenses and other                                                                 |                           |                            | 82,134                                     |         |          |           | 26,975       |        
|                       |                                                                                            |                           |                            |                                            |         |          |           |             
|                       |                                                                                            | Total current assets      |                            |                                            | 480,547 |          |           |              | 510,903 |        
|Property and Equipment |                                                                                            |                           |                            |                                            |         |          |           |             
|                       | Flight equipment                                                                           |                           |                            | 1,533,885                                  |         |          |           | 1,565,691    |        
|                       | Other                                                                                      |                           |                            | 56,112                                     |         |          |           | 47,494       |        
|                       | Less: accumulated depreciation                                                             |                           |                            | (344,009                                   | )       |          |           | (317,360     | )      
|                       |                                                                                            |                           |                            |                                            |         |          |           |             
|                       |                                                                                            |                           | 1,245,988                  |                                            |         |          | 1,295,825 |             
|                       | Purchase deposits on flight equipment                                                      |                           |                            | 52,067                                     |         |          |           | 51,982       |        
|Other Assets           |                                                                                            |                           |                            |                                            |         |          |           |             
|                       | Debt issuance costs (net of accumulated amortization of $22,158
and $20,373, respectively) |                           |                            | 18,831                                     |         |          |           | 20,616       |        
|                       | Deposits and other                                                                         |                           |                            | 54,486                                     |         |          |           | 60,763       |        
|                       |                                                                                            |                           |                            |                                            |         |          |           |             
|                       |                                                                                            |                           |                            | Total assets                               |         | $        | 1,851,919 |              |         | $       | 1,940,089 | 
|                       |                                                                                            |                           |                            |                                            |         |          |           |             
|                       |                                                                                            |                           |                            | Liabilities and Stockholders Equity       |         |          |           |              |         |         |           | 
|Current Liabilities    |                                                                                            |                           |                            |                                            |         |          |           |             
|                       | Accounts payable and accrued liabilities                                                   |                           | $                          | 124,989                                    |         |          | $         | 112,801      |        
|                       | Current maturities of long-term debt and capital lease obligations                         |                           |                            | 72,727                                     |         |          |           | 45,934       |        
|                       |                                                                                            |                           |                            |                                            |         |          |           |             
|                       |                                                                                            | Total current liabilities |                            |                                            | 197,716 |          |           |              | 158,735 |        
|                       | Long-term debt and capital lease obligations, net of current maturities
maturities         |                           |                            | 875,829                                    |         |          |           | 939,052      |        
|                       | Deferred income taxes                                                                      |                           |                            | 28,761                                     |         |          |           | 53,078       |        
|                       | Other liabilities, deferred gains and deferred credits                                     |                           |                            | 345,338                                    |         |          |           | 344,763      |        
|Stockholders Equity   |                                                                                            |                           |                            |                                            |         |          |           |             
|                       | Common stock, $0.01 par value; 1,000 shares authorized; 100
shares issued                  |                           |                            |                                           |         |          |           |             |        
|                       | Additional paid-in capital                                                                 |                           |                            | 305,906                                    |         |          |           | 304,305      |        
|                       | Accumulated other comprehensive income                                                     |                           |                            | 120                                        |         |          |           | 494          |        
|                       | Retained earnings                                                                          |                           |                            | 98,249                                     |         |          |           | 139,662      |        
|                       |                                                                                            |                           |                            |                                            |         |          |           |             
|                       |                                                                                            |                           | Total stockholders equity |                                            |         | 404,275  |           |              |         | 444,461 |          
|                       |                                                                                            |                           |                            |                                            |         |          |           |             
|                       |                                                                                            |                           |                            | Total liabilities and stockholders equity |         | $        | 1,851,919 |              |         | $       | 1,940,089 | 
|                       |                                                                                            |                           |                            |                                            |         |          |           |             

The accompanying notes are an integral part of these financial statements

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Atlas Air, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (In thousands)

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|                                     |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |          |         |         |         |  
|------------------------------------ | ------------------------------------------------------------------------------- | -------------------------------------------------- | ------------------------------------------------------------------------- | -------------------------------------- | ----- | ---------------- | -------- | -------- | ------- | ------- | ------- | -
|                                     |                                                                                 |                                                    |                                                                           |                                        |       | Six Months Ended
|                                     |                                                                                 |                                                    |                                                                           |                                        |       | June 30,        
|                                     |                                                                                 |                                                    |                                                                           |                                        |       |                 
|                                     |                                                                                 |                                                    |                                                                           |                                        |       | 2002             |          | 2001    
|                                     |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         
|Cash Flow from Operating Activities: |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         
|                                     | Net loss                                                                        |                                                    | $                                                                         | (40,946                                | )     |                  | $        | (50,604  | )      
|                                     | Adjustments to reconcile net loss to net cash provided
by operating activities: |                                                    |                                                                           |                                        |       |                  |          |          |        
|                                     |                                                                                 |                                                    | Depreciation and amortization                                             |                                        |       | 41,602           |          |          |         | 40,655  |        
|                                     |                                                                                 |                                                    | Provision for doubtful accounts                                           |                                        |       | 7,827            |          |          |         | 10,151  |        
|                                     |                                                                                 |                                                    | Gain on sale of flight equipment                                          |                                        |       |                 |          |          |         | (15,241 | )      
|                                     |                                                                                 |                                                    | Amortization of debt issuance cost and lease financing
(gains and losses) |                                        |       | 1,785            |          |          |         | (4,979  | )      
|                                     |                                                                                 |                                                    | Change in hedge fair value                                                |                                        |       | (497             | )        |          |         | 4,542   |        
|                                     |                                                                                 |                                                    | Restructuring and impairment                                              |                                        |       | 7,850            |          |          |         | 63,439  |        
|                                     | Deferred income taxes                                                           |                                                    |                                                                           | (24,317                                | )     |                  |          | (52,084  | )      
|                                     | Change in operating assets and liabilities:                                     |                                                    |                                                                           |                                        |       |                  |          |          |        
|                                     | Accounts receivable and other                                                   |                                                    |                                                                           | 5,501                                  |       |                  |          | 33,209   |        
|                                     | Deposits and other                                                              |                                                    |                                                                           | 8,548                                  |       |                  |          | 3,466    |        
|                                     | Accounts payable and accrued liabilities                                        |                                                    |                                                                           | (4,119                                 | )     |                  |          | (96,727  | )      
|                                     |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         
|                                     |                                                                                 | Net cash generated (used) for operating activities |                                                                           |                                        | 3,234 |                  |          |          | (64,173 | )      
|Cash Flow from Investing Activities: |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         
|                                     | Capital expenditures, including purchase deposits for flight equipment          |                                                    |                                                                           | (21,586                                | )     |                  |          | (127,759 | )      
|                                     | Proceeds from sale of equipment and property                                    |                                                    |                                                                           |                                       |       |                  |          | 53,887   |        
|                                     | Purchase of investments                                                         |                                                    |                                                                           | (15,131                                | )     |                  |          | (54,526  | )      
|                                     | Maturity of investments                                                         |                                                    |                                                                           | 27,554                                 |       |                  |          | 64,065   |        
|                                     |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         
|                                     |                                                                                 |                                                    | Net cash used for investing activities                                    |                                        |       | (9,163           | )        |          |         | (64,333 | )      
|Cash Flow from Financing Activities: |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         
|                                     | Payments on long-term debt and capital lease obligations                        |                                                    |                                                                           | (36,430                                | )     |                  |          | (64,074  | )      
|                                     | Issuance of common stock                                                        |                                                    |                                                                           |                                       |       |                  |          | 43       |        
|                                     | Issuance of treasury stock                                                      |                                                    |                                                                           |                                       |       |                  |          | 912      |        
|                                     | Purchase of treasury stock                                                      |                                                    |                                                                           |                                       |       |                  |          | (126     | )      
|                                     | Net proceeds from debt issuance and lease financing                             |                                                    |                                                                           |                                       |       |                  |          | 681      |        
|                                     | Debt issuance costs and deferred lease costs                                    |                                                    |                                                                           |                                       |       |                  |          | (2,711   | )      
|                                     |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         
|                                     |                                                                                 |                                                    |                                                                           | Net cash used for financing activities |       |                  | (36,430  | )        |         |         | (65,275 | )
|                                     |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         
|Net decrease in cash                 |                                                                                 |                                                    | (42,359                                                                   | )                                      |       |                  | (193,781 | )       
|Cash at the beginning of period      |                                                                                 |                                                    | 199,270                                                                   |                                        |       |                  | 493,723  |         
|                                     |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         
|Cash at end of period                |                                                                                 | $                                                  | 156,911                                                                   |                                        |       | $                | 299,942  |         
|                                     |                                                                                 |                                                    |                                                                           |                                        |       |                  |          |         

The accompanying notes are an integral part of these financial statements.

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Atlas Air, Inc.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

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1.     Unaudited Condensed Consolidated Financial Statements

The accompanying unaudited condensed consolidated financial statements of Atlas
Air, Inc. (Atlas or the Company) have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, these financial statements contain all
adjustments, consisting of normal recurring accruals, necessary to present
fairly the financial position, results of operations and cash flows for the
periods indicated. The Companys 2002 results continue to be adversely impacted
by the current global economic recession, exacerbated by the September 11, 2001
terrorist attacks. Results of operations for the periods presented herein are
not necessarily indicative of results of operations for the entire year due to
the seasonality of our business. For further information, refer to the
consolidated financial statements and footnotes thereto included in the Atlas
Air, Inc. Annual Report on Form 10-K for the year ended December 31, 2001
(2001 Form 10-K). Certain amounts from 2001 have been reclassified to
conform with the 2002 presentation. Certain amounts have been reclassified in
the second quarter of 2002.

2.     Recently Issued Accounting Standards

In June 2001, the Financial Accounting Standards Board (FASB) issued SFAS No.
141, Business Combinations and SFAS No. 142, Goodwill and Other Intangible
Assets. These standards revise the rules related to the accounting for
business combinations, goodwill and other intangible assets. SFAS No. 141
requires that all business combinations initiated after June 30, 2001 be
accounted for using the purchase accounting method. SFAS No. 142 states that
goodwill and indefinite-lived assets are subject to impairment tests rather
than amortization. In addition, intangible assets should be separately
recognized if the benefit of the intangible asset is obtained through
contractual or other legal rights, or if the intangible asset can be sold,
transferred, licensed, rented or exchanged, regardless of the acquirers intent
to do so. As the Company does not have any goodwill or other intangible
assets, these pronouncements had no impact on the Companys financial position
or results of operations.

In June 2001, the FASB issued SFAS No. 143, Accounting for Asset Retirement
Obligations. This standard addresses financial accounting and reporting for
obligations associated with the retirement of tangible long-lived assets and
the associated asset retirement costs. The standard requires recognition of
the fair value of a liability for an asset retirement obligation in the period
in which it is incurred and is effective for financial statements issued for
fiscal years beginning after June 15, 2002. Management is currently assessing
the impact of this pronouncement and does not expect it to have a material
impact on the Companys financial position or results of operations.

In August 2001, the FASB issued SFAS No. 144 Accounting for the Impairment or
Disposal of Long-Lived Assets. This standard addresses financial accounting
and reporting for the impairment of long-lived assets and of long-lived assets
to be disposed of. This Statement supercedes SFAS No. 121 Accounting for the
Impairment of Long-Lived Assets and of Long-Lived Assets to be Disposed of,
and the accounting and reporting provisions of APB Opinion No. 30 Reporting
the Results of Operations  Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions, for the disposal of a segment of a business (as previously
defined in that Opinion). This standard is effective for financial statements
issued for fiscal years beginning after December 15, 2001, and interim periods
within those fiscal years. During the second quarter of 2001, we made
available for sale six B747-200 aircraft. The Company has been unable to sell
these aircraft as a result of poor economic conditions, particularly following
the September 11, 2001 terrorist attacks. At the end of the second quarter of
2002, we completed a mark to market analysis. As a result of further market
value erosion caused by excess B747 freighter capacity, we recorded an
additional $7.9 million impairment charge in the second quarter to record the
aircraft at lower of cost or market. We used third party appraisals to assess
the current values of each specific aircraft. Due to the one year sale
limitation provided under SFAS 144, these aircraft will be placed back into
Held for Usestatus and depreciated beginning in July for the rest of their
remaining life. We estimate the remaining life of the aircraft to range from
18 months to 13 years.

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3.     Investments

The Company invests excess cash in various available-for-sale securities as
defined in SFAS No. 115, Accounting for Certain Investments in Debt and
Equity Securities. SFAS No. 115 requires investments in debt and equity
securities classified as available for sale be measured at fair market value
and unrealized gains and losses recorded as a component of other comprehensive
income. These securities were classified as held to maturity as of June 30,
2002. The net unrealized gain on these investments was approximately $186,000
and $782,000 as of June 30, 2002 and December 31, 2001, respectively.

Accrued interest on investments held at June 30, 2002 was approximately $1.8
million. Accrued interest on investments held at December 31, 2001 was
approximately $1.9 million. Interest earned on these investments and related
maturities is reinvested in similar securities.

4.     Commitments and Contingencies

Boeing 747-400 Purchase Agreement

Atlas has exercised options to acquire six additional new aircraft from
The Boeing Company, two of which were delivered in 2000 and one in June 2002.
With respect to the remaining three aircraft, one was delivered in July 2002,
one is scheduled for delivery in November 2002, and one is scheduled for
delivery in October 2003. The Company has no obligations or commitments with
respect to additional new aircraft deliveries beyond those noted above.

The Company has secured financing for the three 2002 deliveries: Boeing
Capital will finance two aircraft, one of which has been completed, and one
has been financed by GECAS. All three financings are 20 year operating
leases.

Under the terms of the two Boeing Capital financings, $12 million in
previously paid aircraft deposits will be returned to Atlas in the second half
of the year.

Under the GECAS financing, there are no cash rent payments until April 2003.
Payments are on an annual basis through 2018 and a periodic basis thereafter.

With respect to the October 2003 aircraft, Atlas is required to make a further
$21.4 million in purchase deposits. Boeing has recently agreed to modify the
payment profile of these deposits. Atlas had previously been required to pay
$15.6 million in deposits in the second half of 2002 and a further $5.8
million in January of 2003. The entire $21.4 million is now payable in four
equal installments between February and May 2003.

5.     Subsequent Event

Ratification of ALPA Agreement. On June 28, 2002, Atlas and the Airline Pilots
Association (ALPA) reached a tentative agreement for a first labor contract
covering our crewmembers. The contract was ratified by the crewmembers on
July 29, 2002.

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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations

RESULTS OF OPERATIONS

The table below sets forth selected operating data for the three and six months
ended June 30, 2002.

Atlas Air, Inc. Operating Statistics
Quarter and Six Months Ended June 30, 2002 and 2001

|                              |                            |  |                       |        |                          |  |      |        |      |  |  |        |   |  |  |        |  
|----------------------------- | -------------------------- |  | --------------------- | ------ | ------------------------ |  | ---- | ------ | ---- |  |  | ------ | - |  |  | ------ | -
|                              |                            |  | For the quarter ended |        | For the six months ended
|                              |                            |  | June 30,              |        | June 30,                
|                              |                            |  |                       |        |                         
|                              |                            |  | 2002                  |        | 2001                     |  | 2002 |        | 2001
|                              |                            |  |                       |        |                          |  |      |        |     
|Block Hours:                  |                            |  |                       |        |                          |  |      |        |      |  |  |        |   |  |  |       
|                              | Atlas Air, Inc.            |  |                       | 21,396 |                          |  |      | 24,343 |      |  |  | 43,472 |   |  |  | 52,954 |  
|                              | ACMI services              |  |                       | 75     | %                        |  |      | 98     | %    |  |  | 72     | % |  |  | 97     | %
|                              | Hub services               |  |                       | 11     | %                        |  |      |       |      |  |  | 12     | % |  |  |       |  
|                              | Charter and other services |  |                       | 14     | %                        |  |      | 2      | %    |  |  | 16     | % |  |  | 3      | %
|                              | Dry Lease hours            |  |                       | 1,569  |                          |  |      | 1,089  |      |  |  | 2,700  |   |  |  | 2,254  |  
|Aircraft at end of period:(1) |                            |  | 38                    |        |                          |  | 37   |        |      |  |  |        |   |  |  |       



---

|(1) |  | Total Atlas aircraft include 6 parked aircraft and 4 aircraft that are
dry-leased to other carriers.
|--- |  | ----------------------------------------------------------------------------------------------------

Three Months Ended June 30, 2002 and 2001

SummaryThe Company recorded a net lossof $29.9 million, during the second
quarter of 2002, which included an impairment charge of $7.9 million, and a $
3.3 million bad debt expense for aged receivables greater than one year. This
compares to a net loss of $49.0 million, for the same
period in 2001, which also included a $71.2 million restructuring and
impairment charge.

The Companys second quarter 2002 revenues continue to be impacted by a
difficult global economy and the residual effects of the September 11 terrorist
attacks. In total, the Companysoperating revenues decreased $7.9 million,
or 5.3 percent, in the second quarter of 2002 from the same period last year.

Contracted revenuesdecreased by 20.8 percent, or $30.1 million, in the second
quarter of 2002 from the same period in 2001, as hub and new ACMI flying did
not offset the 20.6 percent block hour decline in utilization and three
non-renewed contracts. Three other customers representing 23.5 percent of
contracted service revenue during the second quarter are due for renewal during
the remainder of the year. Failure to renew these contracts or to find
alternative uses for the dedicated aircraft could have a material adverse
effect on our business and financial performance.

Charter revenuesincreased from $2.3 million to $25.2 million primarily due to
increased US military charters, which are the highest unit revenues offered by
Atlas. Military charters are awarded within 45 days in advance of flight,
making forecasting difficult. There can be no assurance that the US Government
will continue military missions at the same level in the future.

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The Companys operating expenses,decreased $46.4 million or 21.0 percent to
$174.5 million, in the second quarter compared to the same period last year,
driven largely by higher levels of all-inclusive flying for the US military,
offset by lower restructuring and impairment charges.

Salaries, wages and benefitsincreased 1.2 percent, or $.3 million, to $27.2
million. On June 28, 2002, Atlas and the Airline Pilots Association (ALPA)
reached a tentative agreement for a first labor contract. The contract was
ratified by Atlas pilots on July 29, 2002, and had no financial impact on the
Companys second quarter results. Atlas pilot labor cost is estimated to
increase by approximately 17 percent during the first year of the contract.
Atlas pilot labor cost represents approximately 53.9% of the Companys total
labor cost.

Aircraft rentsincreased $5.5 million during the second quarter of 2002, as
compared to 2001 due to the purchase of additional cargo capacity from a
related third party. The Company has lease financing in place from Boeing
Capital Aviation Services on a B747-400 that was delivered on June 30, 2002.

Ground handling and airport feesincreased $5.3 million, primarily due to
all-inclusive products such as the Partnership Program, Partial ACMI and
Fractional ACMI. These all-inclusive products now account for approximately
25.0 percent of our consolidated block hours.

Maintenance expenseincreased 21.1 percent or $6.8 million principally due to
higher expenses on the GE-powered B747-400 engine overhaul maintenance program.
The B747-400 engine overhaul program is structured as a power by the hour
program that has built-in escalation provisions that increase over a ten year
period. The Company also recorded within the second quarter an additional $2.0
million for a contractual periodic reconciliation within our B747-200 fleet
power by the hour contract with our overhaul service provider.

Since the majority of our military charter services and other all- inclusive
products bear the risk of increased fuel cost,aircraft fuel expense increased
$9.1 million, due primarily to volume increases.

The Company recorded a $7.9 million impairment chargeon six B747 aircraft that
were being held for sale. These aircraft now have book values equal to the
lower of cost or market values and will be placed back into held for use
status and depreciated to their estimated salvage value over their estimated
remaining lives beginning in the third quarter.

Other operating expensesdecreased 30.1 percent, or $9.9 million, due primarily
to restructuring costs incurred in the three months ended June 30, 2001,
partially offset by increases in crew travel and incidental costs, and higher
insurance and bad debt expense. We recorded $3.3 million in bad debt expenses
related to aged receivables greater than one year old. As a result of the
September 11, 2001 terrorist attacks, aviation insurers have significantly
reduced the maximum amount of insurance coverage available to commercial air
carriers for liability to persons other than employees or passengers for claims
resulting from acts of terrorism, war or similar events (war-risk coverage).
At the same time, they significantly increased the premiums for such coverage
as well as for aviation insurance in general. The US Government has
supplemented the commercial war-risk insurance until August 17, 2002 with a
third party liability policy to cover losses to persons other than employees or
passengers for renewable 60-day periods. In the event the insurance carriers
reduce further the amount of insurance coverage available or the Government
fails to renew war-risk insurance, the Companys results of operations,
financial position, or cash flows could be adversely impacted.

Interest incomedecreased $2.4 million, due primarily to decreases in interest
rates and a decline in available cash balance. Interest expensedecreased $5.6
million or 23.2 percent, resulting primarily from the decrease in the Companys
long-term debt and lower interest rates. Approximately one third of our
long-term debt is LIBOR based. Capitalized interestdecreased $1.1 million,
due primarily to a decrease in interest rates, as the interest on the deferred
portion of the purchase deposits are LIBOR-based and purchase deposits for
flight equipment have been minimal since the same period in 2001.

The effective tax rate for the three months ended June 30, 2002 was 37.6
percent and reflects the provision in Congress economic stimulus package that
changes the period for carrybacks of net operating losses (NOLs). This change
permits the Company to carry back 2001 and 2002 NOLs for five years, rather
than two years, allowing the Company to recover its NOLs more quickly. The
extended NOL carryback resulted in a $24 million refund during the second
quarter.

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Six Months Ended June 30, 2002 and 2001

SummaryThe Company recorded a net lossof $40.9 million, during the six months
ended June 30, 2002, which included a $7.9 million impairment charge, and a
$6.4 million bad debt expense for aged receivables greater than one year. This
compares to a net loss of $50.6 million, for the same period in 2001, which
also included a $71.4 million restructuring and impairment charge, and a pilot
profit sharing settlement expense of $22.8 million.

The Companys operating revenuesdecreased $37.2 million, or 11.3 percent, in
the first six months of 2002 from the same period last year.

Contracted revenuesdecreased by 27.0 percent, or $82.5 million, in the first
six months of 2002 from the same period in 2001 due to lower utilization and
ACMI contracts that were not renewed.
Charter revenuesincreased by $60.0 million primarily due to increased US
military charters, which are the highest yielding service offered by Atlas.
Military charters are awarded within 45 days in advance of flight, making
forecasting difficult. There can be no assurance that the US Government will
continue military missions at the same level in the future.

The Companys operating expensesdecreased $59.9 million, or 15.5 percent, to
$326.0 million, in the first half of the year compared to the first half of
2001, driven largely by higher levels of all-inclusive flying for the US
military, offset by lower restructuring and impairment charges, as well as a
pilot profit sharing settlement recorded in 2001.

Salaries, wages and benefitsdecreased 5.4 percent, or $3.1 million, to $53.9
million, primarily due to pilot furloughs and ground staff reductions which
occurred in the second quarter of 2001. On June 28, 2002, Atlas and ALPA
reached a tentative agreement for a first labor contract. The contract has
been ratified by Atlas crewmembers and has had no financial impact to date.
In May 2001, the Company restored its profit sharing to pilots retroactive to
April 1999, resulting in a 2001settlement of $22.8 million. Atlas pilot
labor cost represents approximately 54.2% of the Companys total labor cost.

Aircraft rentsincreased $6.0 million primarily due to additional cargo
capacity purchased from a related third party. The Company also has
lease financing in place from Boeing Capital Aviation Services on a B747-400 that was delivered
on June 30, 2002.

Ground handling and airport feesincreased $7.9 million, primarily due to the
inclusion of all-inclusive products such as the Partnership Program, Partial
ACMI and Fractional ACMI. These all-inclusive products now account for
approximately 28 percent of our consolidated block hours.

Maintenance expenseincreased $13.2 million, or 21.4 percent, primarily due to
increased expenses on the GE-powered B747-400 engine overhaul maintenance
program. The B747-400 engine overhaul program is structured as a power by the
hour program that has built in escalation provisions that increase over a ten
year period. The Company also recorded an additional $2.0 million for a
contractual periodic reconciliation within our B747-200 fleet power by the
hour contract with an overhaul service provider.

Since the majority of our military services and other
all-inclusive products bear the risk of fuel cost, aircraft fuelexpense
increased $13.3 million, due primarily to volume increases.

During the second quarter of 2001, in response to global economic conditions
and the corresponding decline in air cargo demand, we decided to make six
aircraft, a combination of Boeing 747-200 and 300s, available for sale. As a
result, and in accordance with then SFAS 121, Accounting for the Impairment of
Long-Lived Assets and Long-Lived Assets to be Disposed of, we recorded a
$54.1 million charge within the caption Restructuring and Impairments. We also
made the decision to terminate our construction of the Miami hangar facility,
which resulted in an impairment charge of $13.2 million, during the second
quarter of 2001. Subsequently, in accordance with SFAS 144, we recorded an
additional $7.9 millionimpairment charge during the second quarter of 2002 on
the six B747 aircraft that were held for sale due to continuing erosion of
aircraft values. These aircraft will be placed back into held for use status
and depreciated down to their estimated salvage value over their estimated
remaining lives beginning in the third quarter. Estimated depreciation expense
for these six aircraft is expected to be $1.2 million per quarter.

Based on the events above, we also announced a pilot furlough of 105 crew
members and reduced work staff of 200 other employees. Under the restructuring
plan, the affected employees received severance and termination

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benefits resulting in a 2001 second quarter charge of $3.9 million. No
expenses related to the restructuring have been incurred in 2002.

Other operating expensesdecreased 21.1 percent, or $11.9 million, due
primarily to restructuring charges in the six months ended June 30, 2001,
partially offset by increases in travel and incidental costs, and higher
insurance and bad debt expense. We recorded $6.4 million in bad debt expenses
related to aged receivables greater than one year old during the current
period. As a result of the September 11, 2001 events, aviation insurers have
significantly reduced the maximum amount of insurance coverage available to
commercial air carriers for liability to persons other than employees or
passengers for claims resulting from acts of terrorism, war or similar events
(war-risk coverage). At the same time, they have significantly increased the
premiums for such coverage as well as for aviation insurance in general. The
US Government has supplemented the commercial war-risk insurance until August
17, 2002 with a third party liability policy to cover losses to persons other
than employees or passengers for renewable 60-day periods. In the event the
insurance carriers reduce further the amount of insurance coverage available or
the Government fails to renew war-risk insurance, the Companys results of
operations, financial position, or cash flows could be adversely impacted.

Interest incomedecreased $6.8 million, due primarily to decreases in interest
rates and lower available cash balances.Interest expensedecreased $6.4
million, or 12.9 percent, resulting primarily from the decrease in the
Companys long-term debt and lower interest rates. Approximately one third of
our long-term debt is LIBOR based.Capitalized interestdecreased $1.5
million, due primarily to a decrease in interest rates, as the interest on the
deferred portion of the purchase deposits are LIBOR-based and purchase deposits
for flight equipment have been minimal since the same period in 2001.

The effective tax rate for the six months ended June 30, 2002 was 37.8 percent
and reflects the provision in Congress economic stimulus package that changes
the period for carrybacks of net operating losses (NOLs). This change permits
the Company to carry back 2001 and 2002 NOLs for five years, rather than two
years, allowing the Company to recover its NOLs more quickly. The extended NOL
carryback resulted in a $24 million refund during the second quarter.

Cash Flows

Operating Activities: Net cash generated by operating activities for the six
months ended June 30, 2002 was $3.2 million, including a $24 million refund
from the IRS, compared to net cash used by operating activities of $64.2
million for the six months ended 2001. The cash flows from operating activities
for the six months ended June 30, 2002 do not reflect non-cash
reclassifications between property, plant and equipment and prepaid expenses of
$30 million, and accrued liabilities and prepaid expenses of $32 million, both
representing prepaid aircraft rent paid in previous periods.

Investing Activities: Net cash expenditures for investing activities of $9.2
million for the six-month period ended June 30, 2002 reflect capital
expenditures of $21.6 million, partially offset by the net maturity of
investments of $12.4 million. Net cash expenditures for investing activities
of $64.3 million for the six month period ended June 30, 2001 reflect capital
expenditures of $127.8 million, partially offset by proceeds from the sale of
property and equipment of $53.9 million and net maturing investments of $9.5
million.

Financing Activities:Net cash used for financing activities of $36.4 million
for the six month period ended June 30, 2002
consisted entirely of $36.4 million of payments on long term debt and capital
lease obligations. Net cash used for financing activities of $65.3 million for
the six months ended June 30, 2001 consisted primarily of $64.1 million of
payments on long term debt and capital lease obligations,
partially offset by net proceeds from issuance of common and treasury stock.

LIQUIDITY AND CAPITAL RESOURCES

We expect to fund our anticipated cash requirements (including payments of
principal and interest on outstanding indebtedness, lease payments and capital
expenditures, exclusive of aircraft acquisitions) from operating cash flow and
our cash and short-term investments. At June 30, 2002, our cash and short term
investments totaled $256.7 million. We generally fund the purchases of aircraft
from external sources.

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The contractual nature of our debt and lease obligations is such that first and
third quarter payments are significantly larger than those in the second and
fourth quarters. In addition, our business is highly seasonal, with peak
revenue activity typically occurring in the second half of the year,
particularly in the fourth quarter.

During the quarter, we amended the terms of Atlas Aircraft Loan Facility and
its AFL III term loan (seeCapital Structure). The amendments primarily
focused on easing the minimum liquidity covenant through the end of the year.
At quarter-end, Atlas cash and short-term investments equaled $256.7 million.

The amendments also revised the leverage and interest coverage ratios through
December 31, 2002. These ratios, along with the net worth covenant, are
considerably more restrictive than the amended liquidity covenant and as such,
will be monitored closely. Should they prove too restrictive, we will work
with the lead bank to obtain further amendments or waivers. In any event,
Atlas will be required to consult with the lead bank and its bank group during
the second half of 2002 in order to amend covenants for 2003 and beyond. There
can be no assurance that the banks will agree to any such waivers or amendments
should the 2002 covenants be revisited, or of a successful re-negotiation with
respect to the 2003 covenants. A breach of any covenants under these facilities
would permit the lender to declare the balance to be due and payable.

We are highly leveraged and have significant amounts of long-term financial
obligations coming due over the next several years. At June 30, 2002 our
outstanding long-term debt, including the current portion, measured
$948.6
million and long-term lease obligations amounted to $3.0 billion. We believe
that the current cash and short-term investment balances, together with cash
flow from operations, are sufficient to meet our anticipated liquidity needs
for the next twelve months. Based on the current conditions in the aviation
industry and the global economy, however, positive cash flow from operations
over a similar time frame cannot be assured. To the extent that operating cash
flow and cash and investments on hand prove insufficient to fund planned
operating activities, to service our debt and to meet our lease obligations, we
would be required to sell assets and/or engage in refinancings to meet any such
deficiency. There can be no assurance that any such refinancing or sale of
assets could be realized, or on terms favorable to the company.

Capital Structure

The following table sets forth our long term debt (including current
maturities) (dollars in thousands):

|                           |  |                  |         |                      |  |   |         | 
|-------------------------- |  | ---------------- | ------- | -------------------- |  | - | ------- | 
|                           |  | At June 30, 2002 |         | At December 31, 2001
|                           |  |                  |         |                     
|AFL III Term Loan Facility |  | $                | 213,149 |                      |  | $ | 213,149 | 
|Aircraft Credit Facility   |  |                  | 50,607  |                      |  |   | 68,107  | 
|Senior Notes               |  |                  | 437,335 |                      |  |   | 437,328 | 
|EETCs                      |  |                  | 178,210 |                      |  |   | 190,091 | 
|Other                      |  |                  | 69,255  |                      |  |   | 76,311  | 
|                           |  |                  |         |                      |  |   |         | 
|                           |  | $                | 948,556 |                      |  | $ | 984,986 | 

During the quarter, we amended the terms of Atlas Aircraft Credit Facility and
its AFL III term loan. The amendments primarily focused on easing the minimum
liquidity covenant through the end of the year. In addition, the leverage and
interest coverage ratios were likewise amended through December 31, 2002. (see
Liquidity and Capital Resources).

The amendments also reduced the available amount under the Aircraft Credit
Facility from $140 million to the existing drawn amount of $50.6 million, and
converted the drawn amount to a term loan; it additionally requires Atlas to
pledge three previously unencumbered aircraft to the AFL III lenders. As part
of these amendments, Atlas agreed to an increase in the interest rate on
related borrowings by 50 basis points.

At June 30, 2002 Atlas was in compliance with the financial covenants contained
in its credit agreements.

Critical Accounting Policies and Estimates

Critical accounting policies are defined as those that are reflective of
significant judgments and uncertainties and potentially result in materially
different results under different assumptions and conditions. The Company has
prepared the accompanying financial statements in conformity with generally
accepted accounting principles, which require management to make estimates and
assumptions that affect the reported amounts in the financial

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statements and accompanying notes. Actual results could differ from those
estimates under different assumptions or conditions. The Company has identified
the following critical accounting policies utilized in the preparation of these
financial statements.

Revenue Recognition

Under our ACMI contracts and charter services, revenue is recognized in the
financial statements for the actual block hours operated on behalf of a
customer during a calendar month, unless the actual block hours are less than
the minimum guaranteed hours under the contract, in which case revenue is
recognized for minimum guaranteed hours. Some contracts contain a provision
that allows customers to make up the shortfall in the minimum guaranteed hours
over specified future months (measurement period). Under those contracts,
revenue is recognized for the actual block hours flown and recognition of the
shortfall in minimum guaranteed hours is deferred until either the shortfall
has not been made up at the end of the measurement period or there is a fair
degree of certainty during the measurement period that the cumulative shortfall
will not be made up.

Planned Major Maintenance Activities

A significant portion of scheduled and unscheduled maintenance is contracted
with three maintenance providers under long-term agreements pursuant to which
monthly reserve payments are made to the providers based on flight-hours and
such amounts are charged to expense. Other maintenance and repairs are charged
to expense as incurred, except for significant airframe overhauls which are
capitalized and charged to expense on a flight-hour basis and certain other
major maintenance events which are capitalized and amortized over the
corresponding life.

Accounts Receivable

We are required to estimate the collectibility of our trade receivables. A
considerable amount of judgment is required in assessing the ultimate
realization of these receivables, including the current credit-worthiness of
each customer. Significant changes in required reserves have been recorded in
recent periods and may occur in the future due to the current market
environment.

OUTLOOK

The September  December period is traditionally a period of peak activity in
the global cargo market. All indications are that this years September 
December period will be very active. The Company currently expects
consolidated block hours for the third and fourth quarters to be significantly
greater than those experienced during the first half of the year. All of the
Companys lines of business should show improved results, particularly its
charter activities. As a result, the Company currently expects to reactivate
three of the six aircraft currently parked by Atlas. Operating expenses will also increase due to incremental activity, the recently
ratified pilot contract at Atlas, and maintenance on aircraft reactivated.

FORWARD-LOOKING INFORMATION

Statements in this report contain various forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, which represent the
Companys expectations or beliefs concerning future events. When used in this
document and in documents incorporated herein by reference, the words
expects, plans, anticipates, believes, and similar expressions are
intended to identify forward-looking statements. Other forward-looking
statements include statements which do not relate solely to historical facts,
such as, without limitation, block hour estimates for the remainder of the
year, statements which discuss the possible future effects of current known
trends or uncertainties, or which indicate that the future effects of known
trends or uncertainties cannot be predicted,

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guaranteed or assured. All forward-looking statements in this report are based
upon information available to the Company on the date of this report. The
Company undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information, future
events or otherwise. Forward-looking statements are subject to a number of
factors that could cause actual results to differ materially from our
expectations. Additional information concerning these and other factors is
contained in the Companys Securities and Exchange Commission filings,
including but not limited to the Form 10-K for the year ended December 31,
2001.




Item 3. Quantitative and Qualitative Disclosures about Market Risk

As our traditional ACMI business model changes to a more risk- inherent product
with hub services, including the Partnership Program, and expanded charter
services, our results of operations are impacted more significantly by changes
in the price of aircraft fuel. Aircraft fuel comprised 5.6% of our operating
expenses during the first six months of 2002, compared to 4.4% for the full
year 2001. We expect this expense to grow as our charter and other
service operations become a larger portion of our business.

Based on our estimated fuel consumption for 2002, a 10% increase in the average
price per gallon of aircraft fuel would increase our fuel cost by $5.6 million.

We are currently reviewing hedging strategies and may engage in future fuel
hedging activities or fuel purchase commitments in order to manage the price
and utilization of our fuel expense.

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PART II. OTHER INFORMATION




Item 6. Exhibits and Reports on Form 8-K.

(a)  Exhibits

None.

(b)  Reports on Form 8-K

On April 3, 2002, Atlas Air filed a Current Report on Form 8-K reporting,
under Item 5  Other Events, guidance regarding expected financial results for
the first quarter and full-year 2002, expected cash balances at the end of the
first quarter and at year-end 2002 and anticipated block hour distribution for
the first quarter and full-year 2002.

On April 26, 2002, Atlas Air filed a Current Report on Form 8-K reporting,
under Item 4  Changes in Registrants Certifying Accountant, the dismissal of
Arthur Andersen LLP as the Companys independent public accountants and the
appointment of Ernst & Young LLP to so act.

On May 30, 2002, Atlas Air filed a Current Report on Form 8-K reporting,
under Item 5  Other Events, that the National Mediation Board had released
Atlas Air and its crewmembers from mediated negotiations with respect to a
first labor contract covering the Companys pilots and flight engineers.

On June 14, 2002, Atlas Air filed a Current Report on Form 8-K reporting,
under Item 5  Other Events, guidance regarding expected financial results for
the second quarter and full-year 2002 and an anticipated reduction in the
Companys second quarter block hours.

On June 21, 2002, Atlas Air filed a Current Report on Form 8-K reporting,
under Item 5  Other Events, that an agreement had been reached with Atlas
bank lenders to amend certain loan agreements for 2002.

On June 28, 2002, Atlas Air filed a Current Report on Form 8-K reporting,
under Item 5  Other Events, that a tentative agreement had been reached with
the Airline Pilots Association for a first labor contract covering the
Companys pilots and flight engineers.

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Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

|                     |  |     |  |                                                                                       
|-------------------- |  | --- |  | --------------------------------------------------------------------------------------
|                     |  |     |  | Atlas Air, Inc.                                                                       
|                    
|                    
|Date: August 5, 2002 |  | By: |  | /s/ Douglas A. CartyDouglas A. Carty
Senior Vice President and Chief Financial Officer

16



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##### Table of Contents



CERTIFICATION

Each of the undersigned hereby certifies in his capacity as an officer of
Atlas Air, Inc. (the Company) that the Quarterly Report of the Company on
Form 10-Q for the periods ended June 30, 2002 fully complies with the
requirements of Section 13(a) of the Securities Exchange Act of 1934 and that
the information contained in such report fairly presents, in all material
respects, the financial condition of the Company at the end of such periods
and the results of operations of the Company for such periods.

|                      |  |                                                                 
|--------------------- |  | ----------------------------------------------------------------
|Dated: August 5, 2002 |  | /s/ Richard H. ShulyerRichard H. Shuyler
Chief Executive Officer
|                     
|                      |  | /s/ Douglas A. CartyDouglas A. Carty
Chief Financial Officer