<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    Form 10-Q

(Mark one)

(X)  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 1997

                                          OR

(  ) 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  0-28428

                             AIRNET SYSTEMS, INC.     
            --------------------------------------------------------
     (Exact name of registrant as specified in its charter)

                  Ohio                            31-1458309
    ----------------------------------     -----------------------
     (State or other jurisdiction of          (I.R.S. Employer
     incorporation or organization)           Identification No.)

         3939 International Gateway, Columbus, Ohio 43219
    --------------------------------------------------------
     (Address of principal executive offices)  (Zip Code)

                        (614) 237-9777
    --------------------------------------------------------
     (Registrant's telephone number, including area code)

                         NOT APPLICABLE
    --------------------------------------------------------
     (Former name, former address and former fiscal year,
                 if changed since last report)
    
    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___

Common Shares, $.01 Par Value,
    Outstanding as of November 7, 1997 - 12,471,850


                             Index to Exhibits at page 15
<PAGE>

                                 AIRNET SYSTEMS, INC.

                 FORM 10-Q FOR FISCAL QUARTER ENDED SEPTEMBER 30, 1997



PART I:  FINANCIAL INFORMATION

 Item 1  Financial Statements (Unaudited)

         Condensed Consolidated Balance Sheets as of September 30, 1997 and
         September 30, 1996. . . . . . . . . . . . . . . . . . . . . . . . .  3

         Condensed Consolidated Statements of Operations for the three months
         and nine months ended September 30, 1997 and 1996. . . . . .  . . .  4

         Condensed Consolidated Statements of Cash Flows for the nine months 
         ended September 30, 1997 and 1996 . . . . . . . . . . . . . . . . .  5

         Notes to Condensed Consolidated Financial Statements. . . . . . . .  6

 Item 2  Management's Discussion and Analysis of Financial Condition 
         and Results of Operations . . . . . . . . . . . . . . . . . . . . .  9

 Item 3  Quantitative and Qualitative Disclosures About Market Risk. . . . . 12

PART II:  OTHER INFORMATION

 Items 1 through 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

 Signatures  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

                                       2

<PAGE>

                         PART I - FINANCIAL INFORMATION
                          ITEM 1 - FINANCIAL STATEMENTS

                              AIRNET SYSTEMS, INC.

                      CONDENSED CONSOLIDATED BALANCE SHEETS


<TABLE>
<CAPTION>
                                                                        SEPTEMBER 30,
                                                                    1997              1996
                                                                -----------       ------------
                                                                (UNAUDITED)
                                                                           (note 1)
<S>                                                              <C>               <C>
ASSETS
Current assets:
     Cash and  cash equivalents                                  $4,729,285         $11,564,191
     Accounts receivable:
        Trade, less allowances                                   11,777,716           7,392,648
        Shareholder, affiliates, and employees                      246,552             260,220
     Spare parts and supplies                                     6,203,793           5,195,917
     Deposits and prepaids                                        7,099,584           3,039,249
                                                                -----------         -----------
Total current assets                                             30,056,930          27,452,225

Net property and equipment                                       55,165,077          40,821,612

Other assets:
     Intangibles, net of accumulated amortization                 5,376,204           1,741,091
     Investment in partnerships and other                         3,318,608              48,103
     Deferred tax asset                                                   -           5,803,057
                                                                -----------         -----------
Total assets                                                    $93,916,819         $75,866,088
                                                                -----------         -----------
                                                                -----------         -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
     Accounts payable                                            $5,410,235          $3,959,016
     Salaries and related liabilities                             1,365,303           1,264,338
     Accrued expenses                                             1,626,586             553,359
     Deferred taxes                                                 208,995             208,995
                                                                -----------         -----------
Total current liabilities                                         8,611,119           5,985,708

Notes payable                                                     5,000,000             196,579
Deferred tax liability                                            3,397,062           3,397,062

Shareholders' equity:
     Preferred shares, $.01 par value; 10,000,000 shares
       authorized; and no shares issued and outstanding                   -                   -
     Common shares, $.01 par value; 40,000,000 shares
       authorized; and 12,465,443 and 12,463,788 shares
       issued and outstanding at September 30, 1997
       and September 30, 1996, respectively                         127,450             124,638
     Additional paid-in-capital                                  79,764,030          76,063,102
     Retained earnings                                            2,779,146          (9,901,001)
     Treasury shares; 279,600 shares held at cost  (note 6)      (5,761,988)                  -
                                                                -----------         -----------
Total shareholders' equity                                       76,908,638          66,286,739
                                                                -----------         -----------
Total liabilities and shareholders' equity                      $93,916,819         $75,866,088
                                                                -----------         -----------
                                                                -----------         -----------
</TABLE>

See notes to condensed consolidated financial statements


                                        3

<PAGE>

                              AIRNET SYSTEMS, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                           THREE MONTHS ENDED           NINE MONTHS ENDED
                                                              SEPTEMBER 30,               SEPTEMBER 30,
                                                      --------------------------    --------------------------
                                                          1997           1996           1997          1996
                                                      -----------    -----------    -----------    -----------
                                                                (note 1)                      (note 1)
<S>                                                   <C>            <C>            <C>           <C>
    Net revenues 
     Air transportation                               $25,921,506    $21,066,677    $70,456,193    $60,742,027
     Fixed base operations                                325,746        287,993      1,088,088        812,414
                                                      -----------    -----------    -----------    -----------
    Total net revenues                                 26,247,252     21,354,670     71,544,281     61,554,441

    Costs and expenses
     Air transportation                                18,415,904     13,741,029     48,095,673     40,949,813
     Fixed base operations                                284,370        325,995        860,312        823,753
     Selling, general and administrative                1,525,052      2,271,622      5,605,141      8,727,209
                                                      -----------    -----------    -----------    -----------
    Total costs and expenses                           20,225,326     16,338,646     54,561,126     50,500,775
                                                      -----------    -----------    -----------    -----------
    Income from operations                              6,021,926      5,016,024     16,983,155     11,053,666
    Interest expense                                       24,563         19,145         25,331        695,071
    Offering related non-recurring expenses                     -              -              -     13,704,398
                                                      -----------    -----------    -----------    -----------
    Income (loss) before income taxes                   5,997,363      4,996,879     16,957,824     (3,345,803)
    Provision for income taxes (note 4)                 2,399,000      2,173,386      6,763,000      4,202,491
                                                      -----------    -----------    -----------    -----------
    Net income (loss)                                  $3,598,363     $2,823,493    $10,194,824    ($7,548,294)
                                                      -----------    -----------    -----------    -----------
                                                      -----------    -----------    -----------    -----------
    Net income per common share                             $0.29          $0.23          $0.81              -
                                                      -----------    -----------    -----------
                                                      -----------    -----------    -----------
    Weighted average common shares outstanding         12,579,466     12,463,788     12,611,375              -

    Pro forma information (note 5):
     Historical loss before income taxes                                                           ($3,345,803)
     Pro forma adjustments other than income taxes                                                   2,942,320
                                                                                                   -----------
     Pro forma loss before income taxes                                                               (403,483)
     Pro forma tax provision on pro forma loss                                                       4,297,026
                                                                                                   -----------
     Pro forma net loss                                                                            ($4,700,509)
                                                                                                   -----------
                                                                                                   -----------
     Pro forma net loss per common share                                                                ($0.52)
                                                                                                   -----------
                                                                                                   -----------
     Weighted average common shares outstanding                                                      8,981,587
</TABLE>

See notes to condensed consolidated financial statements

                                        4

<PAGE>

                              AIRNET SYSTEMS, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                NINE MONTHS ENDED
                                                                                    SEPTEMBER 30,
                                                                          -------------------------------
                                                                              1997                1996
                                                                          -----------         -----------
                                                                                     (note 1)
<S>                                                                       <C>                 <C>
Operating activities
Net income (loss)                                                         $10,194,824         ($7,548,294)
Adjustments to reconcile net income (loss) to net cash
   provided by operating activities:
     Offering related non-recurring, non-cash expenses                              -          13,704,398
     Depreciation                                                           6,598,119           6,488,951
     Amortization of intangibles                                              245,878             242,352
     Deferred taxes                                                         4,157,994           2,438,000
     Provision for losses on accounts receivable                               42,481              26,502
     Deferred compensation                                                          -             403,139
     Loss (gain) on disposition of assets                                     (87,593)             79,295
     Cash provided by (used in) in operating assets and liabilities:
       Accounts receivable                                                 (3,519,354)             18,344
       Spare parts and supplies                                            (1,155,216)           (641,822)
       Prepaid expenses                                                    (3,255,962)           (353,480)
       Accounts payable                                                     1,227,860          (2,603,743)
       Accrued expenses                                                     1,172,496          (1,014,299)
       Salaries and related liabilities                                      (786,871)            127,219
       Other, net                                                            (288,700)            (41,425)
                                                                          -----------         -----------
Net cash provided by operating activities                                  14,545,956          11,325,137

Investing activities
Acquisition of Pacific Air Charter, Inc. net of cash acquired (Note 3)       (209,846)                  -
Acquisition of Data Air Courier, Inc., net of cash acquired (Note 3)       (4,049,216)
Acquisition of Midway Aviation, Inc., net of cash acquired (Note 3)                            (2,810,416)
Purchases of property and equipment                                       (15,452,352)        (10,908,597)
Payments for covenants not  to compete                                       (105,000)                  -
Proceeds from sales of property and equipment                                 933,037                   -
                                                                          -----------         -----------
Net cash used in investing activities                                     (18,883,377)        (13,719,013)

Financing activities
Proceeds from the issuance of Common Shares - net                                 (29)         82,697,107
Exercise of stock options                                                   1,757,266                   -
Purchase of Donald Wright Warrant                                                   -         (29,901,785)
Proceeds from shareholder notes receivable                                          -             282,508
Repayment of borrowings under the revolving credit facility                         -          (6,375,000)
Repayment of long-term debt                                                (1,560,206)        (12,336,705)
Proceeds from the issuance of long-term debt                                5,000,000           1,004,000
Purchase of treasury stock                                                 (5,761,988)                  -
Distributions to shareholders                                                       -         (23,384,233)
                                                                          -----------         -----------
Net cash provided by (used in) financing activities                          (564,957)         11,985,892
                                                                          -----------         -----------

Net increase (decrease) in cash                                            (4,902,378)          9,592,016
Cash and cash equivalents at January 1                                      9,631,663             151,115

                                                                          -----------         -----------
Cash and cash equivalents at September 30                                  $4,729,285          $9,743,131
                                                                          -----------         -----------
                                                                          -----------         -----------
</TABLE>

See notes to condensed consolidated financial statements

                                        5


<PAGE>

                                 AIRNET SYSTEMS, INC.
                                           
                 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                     (UNAUDITED)
                                           

1.   BASIS OF PRESENTATION

AirNet Systems, Inc. (the "Company") operates a fully integrated national air
transportation network which provides delivery service of time-critical
shipments for customers in the U.S. banking industry and other industries.  The
Company also offers retail aviation fuel sales and related ground services for
customers in Columbus, Ohio.  

The accompanying unaudited condensed consolidated financial statements include
the accounts of AirNet Systems, Inc. and its subsidiaries.  These financial
statements have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions for Form
10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all
information and footnotes required by generally accepted accounting principles
for complete financial statements.  These financial statements should be read in
conjunction with the fiscal year ended September 30, 1996 consolidated financial
statements of AirNet Systems, Inc. contained in the Annual Report on Form 10-K
(File No. 0-28428) for additional disclosures including a summary of the
Company's accounting policies, which have not changed.

The financial information included herein reflects all adjustments (consisting
of normal recurring adjustments) which are, in the opinion of management,
necessary for a fair presentation of the results of interim periods.  Operating
results for the nine months ended September 30, 1997 are not necessarily
indicative of the results to be expected for the year ending December 31, 1997. 
On May 14, 1997, the Board of Directors of the Company approved a change in the
fiscal year end of the Company from September 30 to December 31.

The preparation of the condensed consolidated financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes thereto.  Actual results could differ from
those estimates.


2.   INITIAL PUBLIC OFFERING

In May, 1996, the Company completed its initial public offering (the "Offering")
which raised approximately $83.0 million, net of expenses.  Proceeds were used
to repay outstanding debt, repurchase an outstanding warrant, make distributions
to former shareholders and to provide working capital to finance future
acquisitions and internal growth.


3.  ACQUISITIONS

Effective July 31, 1997, the Company acquired all of the outstanding common
shares of Data Air Courier, Inc. ("Data Air"), whose primary business involves
the nationwide transportation of canceled checks between clearing banks through
the use of company owned ground vehicles, independent agents and commercial
airlines.  The Company accounted for the acquisition under the purchase method
of accounting.  The purchase price of the acquisition totaled approximately
$4,049,000 and resulted in goodwill of approximately $3,610,000, which will be
amortized over 25 years.  The Company also entered into a five year covenant not
to compete for $50,000.  Of the purchase price, $800,000 was placed in escrow
and may be withdrawn in its entirety on July 31, 1998.  The acquired assets and
assumed liabilities, including goodwill,  have been recorded at their estimated
fair values as of July 31, 1997.  The Company's condensed consolidated financial

                                       6

<PAGE>

statements for the three and nine months ended September 30, 1997 include the
results of operations of Data Air since the purchase date.  The following are
pro forma results of operations for AirNet and Data Air as though they were
combined as of the beginning of the periods presented (in thousands, except per
share data):

                         Three months ended     Nine months ended
                            September 30,         September 30,
                            1997      1996       1997        1996
                        ---------   -------   ---------   ---------
                                                          (Pro Forma
                                                          See Note 5)
Revenues                $  27,548   $25,232   $  80,569   $  73,224
Net Income                  3,497     3,001       9,934      (3,901)
Net income per share    $    0.28   $  0.24   $    0.79   $   (0.43)


Effective June 6, 1997, the Company acquired all of the outstanding shares of
Pacific Air Charter, Inc. ("PAC") for approximately $400,000 in cash.  PAC
operates a fleet of eight aircraft, primarily transporting canceled checks
between clearing banks along the West coast.  The results of PAC's operations
since the effective date of the purchase have been included in the Company's
accompanying financial statements.

Effective January 30, 1997, the Company acquired Express Convenience Center,
Inc. d/b/a ECC Worldwide Services ("ECC") in a business combination accounted
for as a pooling of interests. ECC's primary services include small package
delivery services within the United States and certain other countries.  All of
the stock of ECC was exchanged for 145,953 Common Shares of the Company.  The
financial statements of the Company have been restated to include ECC for all
periods presented.


4.   INCOME TAXES 

Prior to the Offering, the Company's income was taxed under the provisions of
Subchapter S of the Internal Revenue Code of 1986, which provides that in lieu
of corporate income taxes, the shareholders of the S Corporation are taxed on
their proportionate share of the Company's taxable income.  Therefore, for the
nine month period ending September 30, 1996, the provision for federal and
certain state income taxes has been included in net income for only for the
portion of operations related to ECC operations and for the period from May 30,
1996, the date of the Offering, to September 30, 1996.

Upon completion of the Offering, the Company ceased to qualify as an S
Corporation and became subject to corporate income taxes.  The Company recorded
a current tax benefit of $1,764,491 related to its operations for the period
from May 30, 1996 to September 30, 1996, which includes the deductibility of a
$2,558,362 write-off of a covenant not to compete.  In the same period, the
Company also recorded an additional net tax liability of $2,438,00 resulting
from the cumulative effect of deferred income taxes attributable to its change
in tax status.  The income tax rate is based on statutory federal and state
rates, and an estimate of annual earnings adjusted for the permanent differences
between reported earnings and taxable income.  

                                       7

<PAGE>

5. PRO FORMA INFORMATION

The pro forma statement of operations for the nine months ended September 30,
1996 presents the pro forma effects on the historical financial information of
certain Offering related transactions as if they had occurred on January 1,
1996.  The following is a summary of such pro forma adjustments:

<TABLE>
<CAPTION>
                                                                             Nine months ended
                                                                             September 30, 1996
                                                                             ------------------
<S>                                                                          <C>
  The elimination of interest expense related to the debt repaid                   $ 666,383
  The elimination of the Wright Agreement not to compete                             536,127
  The elimination of deferred compensation and employee
    stock purchase agreement expense for certain key employees                     1,429,799
  The reduction of compensation expense for executive officers based on new 
    employment agreements                                                            310,011
                                                                                  ----------

           Total pro forma adjustments other than income taxes                    $2,942,320
                                                                                  ----------
                                                                                  ----------
</TABLE>

The pro forma section of the statement of operations also includes an 
estimate of taxes as if the Company were a C Corporation during the entire 
nine months ended September 30, 1996.

Pro forma net loss per share for the nine months ended September 30, 1996 is 
based on the weighted average number of Common Shares outstanding during the 
period, including the effect of the 2,650,764 Common Shares subject to 
certain warrants which were outstanding during the nine months ended 
September 30, 1996. One of the warrants was subsequently purchased by the 
Company and the second warrant was exercised in conjunction with the Offering.

6. TREASURY STOCK

In August, 1997, the Company implemented a  stock repurchase program.  During
the quarter, the Company repurchased 279,600 of the 600,000 common shares they
were authorized to repurchase, for $5,762,000.  The common shares were purchased
at what management believes were reasonable prices.  The repurchase program was
implemented primarily to provide common shares to fund currently outstanding
stock options and the AirNet Systems, Inc. Employee Stock Purchase Program,
without dilution.

7. SUBSEQUENT EVENTS

In October, 1997, subsequent to the close of the quarter, the Company purchased
its current headquarters in Columbus, Ohio from Gerald G. Mercer, the Company's
President and Chief Executive Officer, for $4.1 million.


8. RECENT ACCOUNTING PRONOUNCEMENTS

In February 1997, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 128, "Earnings Per Share" ("FAS
128").  FAS 128 establishes standards for computing and presenting earnings per
share ("EPS").  FAS 128 replaces the presentation of primary EPS with a
presentation of basic EPS which excludes dilution and is computed by dividing
income available to common shareholders by the weighted average number of common
shares outstanding during the period.  This statement also requires dual
presentation of basic EPS and diluted EPS on the face of the income statement
for all periods presented.  FAS 128 is effective for periods ending after
December 15, 1997.  The Company plans to adopt FAS 128 in the period ending
December 31, 1997 and does not expect the impact on EPS to be significant.

                                       8

<PAGE>

The FASB has also recently issued Statement of Financial Accounting Standard No.
130, "Reporting Comprehensive Income" ("FAS 130") and Statement of Financial
Accounting Standard No. 131, "Disclosures about Segments of Enterprise and
Related Information" ("FAS 131").  FAS 130, effective for 1998, will require
separate reporting of certain items affecting shareholders' equity outside of
those included in arriving at net earnings.  The Company does not expect FAS 130
to have a material effect on its financial statements.  FAS 131, effective for
1998, establishes requirements for reporting information about operating
segments in annual reports and interim statements.  The Company has not
determined the impact of FAS 131 on its financial reporting. 




                                 AIRNET SYSTEMS, INC.
                                           
              ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                         CONDITION AND RESULTS OF OPERATIONS
                                           

FORWARD-LOOKING STATEMENTS

Certain matters discussed in this Quarterly Report on Form 10-Q, including, but
not limited to, information regarding future economic performance and plans and
objectives of the Company's management are forward-looking statements which
involve risks and uncertainties.  The following risks and uncertainties, in
addition to the other risks previously disclosed in the Company's filings with
the Securities and Exchange Commission and press releases, could cause actual
results to differ materially from those contemplated in any such forward looking
statement:  potential regulatory changes by the Federal Aviation Administration,
the Federal Reserve or foreign governments, which could increase the level of
regulation of the Company's business; adverse weather conditions; the ability to
successfully integrate the operations of acquired companies; technological
advances and other economic, competitive and governmental factors affecting the
Company's markets, prices and other facets of its operations.  


RESULTS OF OPERATIONS

NINE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,
1996

Net revenues were $71.5 million for the nine months ended September 30, 1997, an
increase of $10.0 million, or 16.2%, over the same period of fiscal 1996.  Net
revenues from check delivery increased $8.4 million, or 16.8%.  Of the increase
in revenues from check delivery, $2.5 million is attributable to price increases
effective January 1, 1997, and approximately $4.7 million can be attributed to
the Midway Aviation ("Midway"), Pacific Air Charter, Inc. ("PAC") and Data Air
Courier, Inc. ("Data Air") acquisitions, which were completed in September 1996,
June 1997 and July 1997, respectively.  The balance is due to increased business
activity and increases in total weight shipped, despite a slight decrease in the
number of flying days from 151 in the nine months ended September 30, 1996 to
150 for the same period in 1997.  Net small package delivery revenues increased
$1.3 million, or 12.0%, due to increased activity from both new and existing
customers.  These results and results from comparable periods in fiscal 1996
include Express Convenience Center, Inc.("ECC"), which was acquired in January,
1997 through a pooling of interests.  Revenues from fixed base operations
increased $0.3 million, or 33.9%, due to an increase in the retail sale of
aviation parts.

                                       9

<PAGE>

Total costs and expenses were $54.6 million for the nine months ended September
30, 1997, an increase of $4.1  million, or 8.0%, over the same period in fiscal
1996, resulting in income from operations of $17.0 million for the nine months
ended September 30, 1997 compared to $11.1 million for the same period of fiscal
1996.  Air transportation expenses were up $7.3 million, or 17.5%, while
selling, general and administrative expenses decreased $3.1 million, or 35.8%,
for the nine month period.

Payroll costs associated with air and ground transportation and customer service
support increased $3.1 million due to the addition of air and ground personnel
required to service a larger fleet of aircraft and the increased volume of
activity.  Increased flight hours, offset slightly by lower fuel prices,
contributed to a $1.2 million, or 19.0%, increase in aircraft fuel expense.  The
increased fleet size, from 94 aircraft at September 30, 1996 to 111 at September
30, 1997, and increased flight hours resulted in a $0.4 million, or 8.9%,
increase in maintenance expense.  The growth in the fleet also contributed to a
$0.2 million increase in aircraft insurance expense.  The Company's costs for
shipping packages on commercial airlines increased $0.9 million due to the
addition of Data Air shipments, of which a significant portion are moved during
daytime hours when the Company's aircraft do not fly.  

Selling, general and administrative expenses decreased primarily due to the
restructuring of executive compensation plans (which resulted in a $0.9 million
decrease), the termination of stock purchase agreements (which resulted in a
$1.4 million decrease) and the termination of a covenant not to compete (which
resulted in a $0.5 million decrease).  All were effective in conjunction with
the Company's initial public offering (the "Offering") in May 1996.  The stock
purchase agreements were with certain executive officers and had been tied to
appreciation in the book value of the Common Shares of the Company.  The
covenant not to compete required payments based on the Company's cash flow and
debt to equity ratio.  

Interest costs decreased $0.7 million as a result of the repayment of all
outstanding debt in September 1996 with proceeds from the Offering.

The Company operated as an S Corporation under the Internal Revenue Code from
1988 until it elected to terminate its S Corporation status in conjunction with
the Offering.  Under its Subchapter S election, shareholders of the Company were
taxed directly on the Company's income and, consequently, the Company was not
subject to federal and certain state income taxes at the corporate level for the
nine months ended September 30, 1996, except for the portion of business that
related to the ECC acquisition, which was taxed as a C Corporation, and the
period subsequent to the Offering in May 1996.  The Company recorded tax expense
of $6.8 million for the nine months ended September 30, 1997 on income for the
period.

Pro forma information reflects the effects of certain Offering related
transactions on the statement of operations for the nine months ended September
30, 1996 as if they occurred on January 1, 1996.   See Note 5 to the Condensed
Consolidated Financial Statements included herein.

Adjusted pro forma net income per share was $0.64 for the nine months ended 
September 30, 1996 with the assumptions that the $13.7 million non-cash, 
non-recurring expenses incurred in conjunction with the Offering are excluded 
and the Common Shares issued in the Offering were outstanding for the entire 
period.

                                      10

<PAGE>

THREE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED TO THREE MONTHS ENDED
SEPTEMBER 30, 1996

Net revenues were $26.2 million for the three months ended September 30, 
1997, an increase of $4.9 million, or 22.9%, over the same period of fiscal 
1996.  Net revenues from check delivery increased $4.3 million, or 24.6%.  Of 
the increase in revenues from check delivery, $0.9 million is attributable to 
price increases effective January 1, 1997 and approximately $3.3 million can 
be attributed to the Midway, PAC and Data Air acquisitions. The balance is 
due to increased business activity and increases in total weight shipped.  
Net small package delivery revenues increased $0.6 million, or 15.5%, due to 
increased activity from both new and existing customers. These results and 
results from comparable periods in fiscal 1996 include ECC.

Total costs and expenses were $20.2 million for the three months ended 
September 30, 1997, an increase of $3.9 million, or 23.8%, over the same 
period in fiscal 1996, resulting in income from operations of $6.0 million 
for the three months ended September 30, 1997 compared to $5.0 million for 
the same period of fiscal 1996.  Air transportation expenses were up $4.7 
million, or 34.0%, while selling, general and administrative expenses 
decreased $0.7 million, or 32.9%, for the three month period.

Payroll costs associated with air and ground transportation and customer 
service support increased $2.0 million due to the addition of air and ground 
personnel required to service a larger fleet of aircraft and the increased 
volume of activity.   An increase in flight hours, offset slightly by a 
decrease in fuel prices, contributed to a $0.3 million, or 13.5%, increase in 
aircraft fuel expense. The increased fleet size, coupled with the increased 
flight hours, resulted in a $0.2 million, or 11.7%, increase in maintenance 
expense.  Aircraft lease expense decreased $0.2 million due to the purchase 
of eleven previously leased aircraft. The Company's costs for shipping 
packages on commercial airlines increased $0.9 million due to the addition of 
Data Air shipments, of which a significant portion are moved during daytime 
hours when the Company's aircraft do not fly.  Courier vehicle costs 
increased $0.2 million due to the increase in the size of the ground fleet 
from approximately 100 vehicles at September 30, 1996 to over 300 at 
September 30, 1997.

A restructuring of officer compensation, coupled with the fact the Company 
employed two less officers in the 1997 quarter contributed to the decrease in 
selling, general and administrative expenses.  A reduction of staff and 
overhead costs associated with the integration of ECC into the Company's 
operations also contributed to the decrease. In addition, the Company  
incurred less in legal fees in the 1997 quarter, compared to the 1996 
quarter.   

LIQUIDITY AND CAPITAL RESOURCES

CASH FLOW FROM OPERATING ACTIVITIES.   Net cash flow from operating activities
was $14.5 million for the nine months ended September 30, 1997, compared to
$11.3 million for the nine months ended September 30, 1996.

CURRENT CREDIT ARRANGEMENTS. The Company maintains a credit agreement with a
bank that provides a $50.0 million, five year, unsecured revolving credit
facility. The credit agreement limits the availability of funds to certain
specified percentages of accounts receivable, inventory and the wholesale value
of aircraft and equipment.  In addition, the credit agreement requires the
maintenance of certain minimum net worth and cash flow levels, imposes certain
limitations on payments of dividends, restricts the amount of additional debt
and requires prior bank approval for certain acquisitions.  As of September 30,
1997, the Company had drawn $5.0 million on the line.

                                      11

<PAGE>

INVESTING ACTIVITIES.  Capital expenditures totaled $15.5 million for the nine
months ended September 30, 1997 compared to $10.9 million for the same period in
fiscal 1996.  Approximately $6.6 million was incurred in connection with the
purchase of 19 new aircraft, ten of which were previously leased by the Company.
The remainder was incurred primarily for flight equipment and delivery vehicles.
The Company anticipates it will spend an additional $5.0 million on capital
items through December 31, 1997, excluding any acquisitions of new businesses. 
The Company anticipates it will continue to acquire aircraft and flight
equipment as necessary to maintain growth and continue offering quality service
to its customers

In October, 1997, subsequent to the close of the quarter, the Company purchased
its current headquarters in Columbus, Ohio from Gerald G. Mercer, the Company's
President and Chief Executive Officer, for $4.1 million in cash.  In September,
1997, the Company also began leasing additional office space.  Currently, the
Company is also considering an expansion of its facilities.  However, no
definitive arrangements or agreements have been reached.

For the nine months ended September 30, 1997, the Company has completed three
acquisitions of companies for approximately $4.3 million in cash and 145,953
Common Shares. See Note 3 to the Condensed Consolidated Financial Statements
included herein.

In August, 1997, the Company implemented a  stock repurchase program.  During
the quarter, the Company repurchased 279,600 of the 600,000 common shares they
were authorized to repurchase, for $5,762,000.  The common shares were purchased
at what management believes were reasonable prices.  The repurchase program was
implemented primarily to provide common shares to fund currently outstanding
stock options and the AirNet Systems, Inc. Employee Stock Purchase Program,
without dilution.

The Company anticipates that operating cash and capital expenditure requirements
will continue to be funded by cash flow from operations, cash on hand and bank
borrowings.


SEASONALITY AND VARIABILITY IN QUARTERLY RESULTS

The Company's operations historically have been somewhat seasonal and somewhat
dependent on the number of banking holidays falling during the week.  Because
financial institutions are currently the Company's principal customers, the
Company's air system is scheduled around the needs of financial institution
customers.  When financial institutions are closed, there is no need for the
Company to operate a full system.  The Company's fiscal quarter ending December
31, is often the most impacted by bank holidays (including Thanksgiving and
Christmas) recognized by its primary customers.  When these holidays fall on
Monday through Thursday, the Company's revenue and net income are adversely
affected. The Company's annual results fluctuate as well.

Operating results are also affected by the weather.  The Company generally
experiences higher maintenance costs during its fiscal quarter ending March 31. 
Winter weather requires additional costs for de-icing, hangar rental and other
aircraft services.  The Company's cash flows are also influenced by the budget
cycles of its primary customers.  Many financial institutions have calendar year
budget cycles and desire to pay for December services prior to year end.  This
results in increased cash flows for the Company's fiscal quarter ending December
31, but decreased cash flows in January and February.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not Applicable.

                                      12

<PAGE>

                                 AIRNET SYSTEMS, INC.
                                           
                             PART II - OTHER INFORMATION
                                           
Item 1.  Legal Proceedings. Not Applicable

Item 2.  Changes in Securities and Use of Proceeds. Not Applicable

Item 3.  Defaults Upon Senior Securities. Not Applicable

Item 4.  Submission of Matters to a Vote of Security Holders.  Not Applicable

Item 5.  Other Information. Not Applicable

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

         (a)  Exhibits:

               Exhibit No.                   Description    
               -----------    -----------------------------------------------
               Exhibit 2(a)   Leasehold Interest Purchase Agreement dated 
                              October 31, 1997 by and between Gerald G. Mercer
                              and AirNet Systems, Inc.

               Exhibit 2(b)   Assignment and Assumption of Leases dated
                              October 31, 1997 by and between Gerald G. Mercer
                              and AirNet Systems, Inc.

               Exhibit 27     Financial Data Schedule.

         (b)  Reports on Form 8-K:

              No reports on Form 8-K were filed during the three months ended
              September 30, 1997.

                                      13

<PAGE>

                                 AIRNET SYSTEMS, INC.

                                      SIGNATURES

       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.




Dated:  November 13, 1997              By:  /s/ Eric P. Roy
                                            -------------------------------
                                            Eric P. Roy, 
                                            Executive Vice President
                                            (Duly Authorized Officer)
                                            (Principal Financial Officer)


                                      14

<PAGE>

                                 AIRNET SYSTEMS, INC.

                                  INDEX TO EXHIBITS



Exhibit No.                           Description                          
-----------   ------------------------------------------------------------ 
  2(a)        Leasehold Interest Purchase Agreement dated October 31, 1997 
              by and between Gerald G. Mercer and AirNet Systems, Inc.     

  2(b)        Assignment and Assumption of Leases dated October 31, 1997   
              by and between Gerald G. Mercer and AirNet Systems, Inc.     

  27          Financial Data Schedule                                      


                                      15