"Credo che Giulia sia in ritardo" is the correct form. Check this: http://www.lifeinitaly.com/italian/conditional-tense-italian

The correct one is "Credo che Giulia SIA in ritardo"

The subjunctive mood (rather than the indicative mood) is used when expressing personal opinion, personal wishes, personal willingness or orders; in this case 'credere' requires the subjunctive form of the third person singular of the verb essere, so 'sia'. The subjunctive mood is also used in other cases, for example, when there is a temporal or logical relationship between main and subordinate clause, but many others too. http://www.italianlanguageguide.com/grammar/subjunctive/