Midwest Express Holdings, Inc.

Raymond James Growth Airline ConferenceJanuary 30, 2003

• Brief History and Investment Highlights

• 2002 in Review

• Going Forward

MEH 1

Midwest Express Airlines

MEH 2

• Began commercial operations in 1984

• Recognized as best U.S. Airline by leading consumer surveys

• Single-class, premium service catering to higher-yield business travelers

‘The Best Care in the Air’

MEH 3

Midwest Express Airlines Service• 25 destinations nationwide• 33 McDonnell Douglas DC-9 and MD-80 jet aircraft in service

MEH 4

Skyway Airlines,The Midwest Express Connection

MEH 5

• Initiated in 1989, became wholly owned subsidiary in 1994

• Builds feeder traffic and provides nonstop service in select markets

Skyway Airlines Service• 33 markets strengthen Milwaukee base• Ten Fairchild Dornier 328JETs and 15 Beech 1900D turboprops in service

MEH 6

Benefits of Premium Service Strategy

• Customer preference, brand loyalty– Preferred by 75% of Milwaukee frequent flyers– Consistently rated #1 U.S. airline by consumers

• More profitable passenger mix– Higher percentage of business travelers– More “high-end” discretionary travelers

• Premium revenue yields– 30-40% higher than industry

MEH 7

Ability to Capture Premium Yields• Midwest Express has historically maintained a significant yield premium

MEH 8

Revenue Yield

$0.00

$0.05

$0.10

$0.15

$0.20

$0.25

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

(cen

ts/rp

m)

MEA U.S. Majors

$0.155

$0.119(e)

Revenue History• 10-year compounded annual revenue growth of 12%

Source: Midwest Express Holdings, Inc. MEH 9

$0

$100

$200

$300

$400

$500

(in m

illio

ns)

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

Revenue

Operating Income History• 1987-2000 operating income: $283 million on sales of $3.1 billion• 1987-2000 operating margin: 9.1%; 1995-2000 operating margin: 10.2%• 2001 operating loss of $12.9 million(1); 2002 operating loss of $24.3 million(2)

(1) Excluding asset impairment charge of $8.8 million, including federal government grant of $16.3 million(2) Excluding asset impairment charge of $29.9 millionSource: Midwest Express Airlines; MEA information as reported, not pro forma.

MEH 10

-$30

-$10

$10

$30

$50

$70

(in m

illio

ns)

1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

Operating Income

Higher Yields Offset Product Costs

(1) 2001 excludes asset impairment charge of $8.8 million and includes federal government grant of $16.3 million; 2002 excludes asset impairment charge of $29.9 millionSource: Midwest Express Airlines/The Airline MonitorMEA information as reported, not pro forma.

MEH 11

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

(cen

ts)

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

Operating Income per ASM

MEA U.S. Majors

2002 In Review

MEH 12

Factors Impacting 2002

• Excess industry capacity and sluggish economy kept pressure on fares

• Leisure-driven, weak revenue environment• Steadily increasing fuel prices throughout

the year• Cost-reduction efforts helped offset difficult

revenue conditions

MEH 13

Profitability: 1999-2002

Revenue

Oper. Income (Loss)

Net Income (Loss)

Net Margin

Earnings (Loss)/Share

Cash Flow(1)

Note: Consolidated financial results of Midwest Express Holdings. Dollars in millions except Earnings Per Share. Information as reported, not pro forma.Note: Consolidated financial results of Midwest Express Holdings. Dollars in millions except Earnings Per Share. Information as reported, not pro forma.2001 operating and net income exclude impact of $8.8 million impairment charge and include federal government grant of $16.3 million. 2002 operating income 2001 operating and net income exclude impact of $8.8 million impairment charge and include federal government grant of $16.3 million. 2002 operating income excludes impact of $29.9 million impairment charge, and net income excludes arbitration settlement gain of $39.5 million.excludes impact of $29.9 million impairment charge, and net income excludes arbitration settlement gain of $39.5 million.(1) Net Income plus depreciation and amortization(1) Net Income plus depreciation and amortization MEH 14

Full Year2002

$427.0

($24.3)

($16.9)

(3.9%)

($1.15)

$4.2

2001

$457.2

($12.9)

($9.3)

(2.0%)

($0.68)

$11.6

2000

$480.0

$6.9

$5.2

1.1%

$0.37

$22.2

1999

$447.6

$60.8

$38.8

8.7%

$2.71

$52.0

Operating Statistics: 1999-2002

Revenue Yield

RPMs (millions)

ASMs (millions)

Load Factor

Revenue per ASM

Cost per ASM(1)

Fuel Price

(1) Excludes asset impairment charges of $8.8 million in 2001 and $29.9 million in 2002.(1) Excludes asset impairment charges of $8.8 million in 2001 and $29.9 million in 2002.Note: Midwest Express Airlines only.Note: Midwest Express Airlines only. MEH 15

Full Year2002

15.5¢

1,966

3,191

61.6%

11.0¢

11.6¢

$0.82

1999

18.5¢

1,959

2,994

65.4%

13.4¢

11.5¢

$0.61

2000

19.3¢

1,975

3,163

62.4%

13.3¢

13.0¢

$1.00

2001

17.6¢

1,974

3,232

61.1%

12.1¢

12.8¢

$0.91

2002 Cost Reduction Efforts

• Continued furlough process to better align staffing with capacity; additional furloughs may be needed

• Redesigned dining services program to reduce costs while maintaining differentiation

• Realigned travel agent commission structure• Implemented wage freeze and benefit adjustments• Concluded agreements with many service providers and

aircraft lessors for concessions or deferrals• Renewed 2003 aviation insurance at reduced rates• Discussions with organized labor in progress

MEH 16

2002 Revenue Generation Efforts

• Focused marketing more on ticket purchase and less on brand image

• Increased emphasis on charter services• Focused segmentation initiatives on underperforming

customers and new customers in key markets• Directed e-mail and online marketing at customers who

haven’t flown on Midwest Express• Revised service fee structure

MEH 17

Results of Cost Reduction and Revenue Generation Efforts

• Lowered cost/asm each quarter (exc. fuel)• Lowered unit costs in most categories despite capacity

reduction• Will realize substantial unit cost benefits as capacity is

restored• Per-ticket distribution costs declined 10% in travel agency

channel, 18% in Web site and 17% in Call Center

MEH 18

Going Forward

MEH 19

2003 – A Rebuilding Year

• Continued difficult operating environment– Poor economy, unstable fare environment, high fuel prices,

geopolitical concerns

• Flexible capacity plan for Midwest Express– Adjust to changes in travel demand– Increase 5-7% in Q1, and generally unchanged for full year

• Skyway growth will slow– Q1 increase of 18-20%, 10-12% for full year– No additional aircraft planned this year

MEH 20

2003 – A Rebuilding Year

• Continued emphasis on cost management• Enhance brand to retain and increase loyalty

– Continue to meet and exceed our customers’ expectations

• Monitor market segments to market, price and sell most efficiently

MEH 21

Liquidity Highlights

• Ended 2002 with $41 million in unrestricted cash, up from $37 million at end of Q3

• 2002 cost management efforts expected to save more than $2 million per month in 2003

• Goal: To be cash-flow neutral by Q2• 2003 capital spending projected at $15 million,

most associated with Boeing 717 spare parts and tooling

MEH 22

Liquidity Highlights

• Bank credit agreement through August 2003• Boeing 717 aircraft to be lease financed

through Boeing Capital Corp– 717 program cash flow positive in 2003

• Continue to pursue other sources of liquidity– Asset-based loans– Alternative sources to support letters of credit– Continued discussion with service providers, contractors and

lessors

MEH 23

Flying Into the Future

•Concentrate on existing bases of operationMilwaukee- Improve market share from existing 37%- Add frequency, citiesKansas City- 5% share of total market; 20-70% share on markets served- Continue to build critical mass and brand loyalty- Further strengthen connection marketsOmaha- 5% market share, dominant carrier in markets served- Limited future growth opportunities

MEH 24

Flying Into the Future

• Implement name changes for both airlines effective March 1, 2003– Midwest Express becomes Midwest Airlines– Skyway Airlines becomes Midwest Connect

• Manage fleet growth through aircraft retirement and acquisition

MEH 25

Boeing 717

MEH 26

• 25 firm orders with options for 25 more• Monthly delivery beginning February 2003• 88 seats in signature 2-by-2 configuration• Fuel efficient, lower maintenance costs• DC-9 retirement timed to 717 deliveries and travel demand

Embraer ERJ

• 20 firm orders with options for 20 more• Bi-monthly delivery beginning January 2004• 2-by-1 configuration• 37-, 44- and 50-seat variations

MEH 27

Midwest Express Holdings, Inc.

www.midwestexpress.com