Northwest Airlines Annual Report 1963

r
NORTHWEST AIRLINES INC.
Total Operating Re\'enues
Operating Income . . .
.:\.' et Earnings for the Year
Per Common Share .
Stockholders' Equity .
Per Common Slwre .
Di\'idends Paid . . .
Operating Expenses-
Per Available Ton-:U ile
Per Ret:enuc Ton-")./ ilc
Revenue Traffic-
Passengers Carried
Pa senger-Miles FlO\vn
Ton-:\Jiles, :\fail, Freight and
Express . . . .
Employees at Year End . .
Common Shares at Year End
1963
$168,788,040
$ 25,915,517
$ 10,452,957
$5.73
$ 68,435,947
$37.51
$ 1,822,656
21.7
46.8
2,911,914
2,179,208,000
73,082,000
6,090
L824A52
0 Based on equivalent shares to reflect Feb-
ruary 1963 conversion of preferred stock.
1962
$150,453,420
$ 19,206,051
$ 7,230,392
$3.97
$ 59,711,883
$32.79
$ 1,701,743
23.9
50.2
2,437,342
1,904,112,000
68,814,000
5,788
1,820,781
1963
IN
REVIEW
Special Notice to Stockholders
NEW DEVELOPMENTS SINCE DECEMBER 3t 1963
Flight Equipment Orders
On February 24, 1964, your Company
announced the purchase from The Boeing
Company of 13 new fan-jet aircraft subject
to completion of n~cessary financing ar-
rangements. Included in the new orders are
two Boeing 720B fan-jets and 11 Boeing
727 three engine fan-jet transports at a to-
tal cost, with related spares of $68,800 000.
Deliveries of the 720B's are scheduled for
July and August 1964. The 727 deliveries
will start in ovember 1964 and will con-
tinue during 1965, with the last aircraft
scheduled for January 1966. Upon com-
pletion of this program Northwest will have
a fleet of 35 Boeing fan-jet aircraft made
up of:
Service Range
Intercontinental
Medium to Long Range
Short to Medium Range
"Including 4 leased.
Type
320B/ C
720B
727
No.
8
16
11
35
Our Electra II prop-jets and such remain-
ing piston aircraft as may be required for
service needs in special areas will round out
a well-balanced fleet of aircraft designed
to develop the maximum potential of our
growing traffic.
Financing
Arrangements for financing of the new
purchases include a broadening of the
Company's equity base by a rights offering
and replacement of our existing bank cre-
dit arrangement with a new one, as well
as the application of internally generated
funds.
Common Stock: You have already been
advised by Prospectus dated March 18,
1964, of the Company's offering of new
shares of Common Stock to stockholders of
record on 1arch 18 at the rate of one new
share for each four shares held. Your Di-
March 20, 1964
rectors have decided to recommend to the
stockholders of the Company that at their
annual meeting in May 1964, they appro e
a 2-for-l split of the Common Stock to be
effective shortly thereafter.
Bank Credit: Subject to satisfactory com-
pletion of the equity financing referred to
herein, re ision of orthwest Airlines' ex-
isting bank credit agreement will provide
for an increase of our revolving credit to
a maximum of $36,000,000 remaining at
that level through 1965, and thereafter sub-
ject to reduction of $6 000,000 on each June
30 and December 31 in the years 1966, 196""'
and 1968. _Tew interest rates have been
negotiated at 4% for funds borrowed and
~i% for funds committed but not dra,,m
down. These rates compare with interest
at 5% and
%, respecti ely, in the present
agreement. Outstanding bank loans un-
der the present agreement amounted to
$11,000,000 at :March 17 1964. Under terms
of the new bank credit agreement the 6%'
Subordinated Note of ~7 500 000 payable to
The Boeing Company and the 5% Condi-
tional Sales Contracts of $5,771 025 for the
Lockheed Electras will be repaid by early
April 1964.
Dividends
Your Directors have declared a cash div-
idend of 30c per share of Common Stock
payable on March 31, 1964, to holders of
record of shares outstanding on March 18,
1964. This is an increase over the dividend
of 25c oer share paid each quarter during
1963. Dividends in years prior to 1963 were
paid at 20c per share per quarter.
NOTE: Your attention is directed to the
Prospectus mailed to you on March 18.
The offering by the Company of add-itio-nal
Common Stock is made only by the Prns-
pectus upon the terms and c011ditions de-
scribed therein. Action must be taken to
P-xercise or to dispose of your rights to sub-
scribe for the new shares by 3:30 p.m. Neu
York City time Ap-ril 1 1964. Such rights
will be of no value after such time and date.
(Included as a supplement to Northwest Airlines, Inc., 1963 Annual Report)
NORTHWEST AIRLINES
ORDERS 11 BOEING 727 FAN-JETS
BOEING 727 FAN-JET AIRLINER, WITH ARTIST'S CONCEPTION OF NORTHWEST'S MARKINGS
THE BOEING 727 AIRCRAFT
General Specifications
Powerplants Three aft-mounted Pratt & Whitney
JT8D-l fan-jet engines
Rated thrust, per engine
Cruising speed
Maximum gross takeoff weight
Maximum landing weight
Wingspan
Over-all length
Wing sweepback angle
Passenger capacity
14,000 pounds
in excess of 600 mph
160,000 pounds
135,000 pounds
108 feet
133 feet, 2 inches
32 degrees
92-99
Operating Characteristics: The 727 will be used by Northwest
Airlines on route segments of sh01t-to-medium length. Through
a combination of carefully designed wing high-lift devices, th e
727 requires only a 5,000 foot runway for normal operations.
THE PRESIDENT'S LETTER
TO OUR STOCKHOLDERS:
, e are plea ed to report th compl tion of anoth r ucc s fol
the first time in orthwest irlin s' history th y ar n t profit
earned on record re\ enues of nearly $169,000 000.
ar of operation. For
xceeded $10 000 000,
Your Company improved its er ice to th public in man ways during 1963- by
offering increased sch dules on key rout s with our e, panding fl t by providing nev and
enlarged terminal facilities to accommodate our cu tom r ; and by continued mphasis on
a high standard of courteous personal service to pass ng rs and hipper alike. Th se
efforts ha e been rewarded v ith increas d haffic and re enu s.
Operating expen s required only 84.6 of ach r \ enu dollar in 1963 compar d v. ith
87.2 in 1962. nit cost of capacity offered d clined from 23.9 p r available ton-mile in
1962 to 21.7 in the y ar just ended. Our br ak- en pass ng r load factor to co er oper-
ating costs and interest declined to a new low of 41.6 p r cent.
Two important flight equipment changes took place in 1963. , e r ceived d livery of
five Boeing int rcontinental 320B fan-jet aircraft and, at year- nd had on order for d livery
in the first half of 1964 three long-range 320C aircraft and on additional 720B fan-jet.
During 1963 we sold our remaining four DC-8 aircraft with th result that w now have a
tandard fleet of fan-jets for greater operating effici ncy and conomy. We have continued
our program for orderly disposal of piston aircraft.
Significant accomplishments have been made in the area of labor relations. After
ettlements concluded during 1963 and early this year we now ha e closed agreements with
17 of our 18 labor groups, and the only contract which remains op n is cunently in
mediation. Major agre ments extend to dates ranging from S ptember 1965 to August
1966. Your Company is fortunate to have a well-hained staff of experienced people
representing 57,000 years of service averaging more than nine years per employ e.
The favorable results achieved by orthw st Airlines in 1963 are due in no small part
to the fine spirit of interest and cooperation di played by our stockholders. I greatly appre-
ciate your valuable support and assistance, so e sential to continued success.
Sincerely,
tfarch, 1964
37TH ANNUAL REPORT
TO STOCKHOLDERS
FINANCIAL RESULTS
Continued growth of operating revenues and
further improvement in net earnings marked
1963 as another year of sound financial progress
for your Company. Northwest Airlines now has
recorded net profits in each of 15 consecutive
years.
orthwest had revenues of $168,788,040 and
operating expenses of $142,872,523, which re-
sulted in net operating income of $25,915,517.
This operating net income is equal to 15.4% of
gross revenue. Nonoperating charges in 1963
included interest expense of $3,876,789 and a
loss before taxes of $307,732 on disposals of
property. In 1962 the nonoperating charge for
interest expense was $5,040,266 and there was
a profit before taxes of $346,352 from disposals
of property.
et earnings after taxes for 1963 were $10,-
452,957, an increase of $3,222,565 over the net
earnings of $7,230,392 in 1962. The Company is
amortizing over an eight-year period the net
jncome tax credit allowable under the investment
credit provisions of the Revenue Act o~ 1962.
Such credits were included in net earnings and
amounted to $106,400 in 1963 and $18,000 in
1962.
Operations in 1963 generated a total cash Bow
of $34,170,756 from net earnings plus deprecia-
tion and deferred income taxes. An additional
amount of $21,738,798 was realized from the
value of Bight equipment sold. The major appli-
cation of funds during the year consisted of ad-
ditions to Beet and deposits on aircraft for deliv-
ery in 1964, which together totaled $44,731,204.
Other applications included debt reduction and
payment of dividends. ( See next page.)
Stockholder Earnings and Net Worth
As a result of conversion of the Cumulative Pre-
ferred Stock early in 1963, the entire stockholder
equity in orthwest Airlines is reflected in the
net worth of Common Stock. Net earnings of
$5.73 per common share were realized in 1963.
This compares with $3.97 per share earned in
1962 ( on the basis of shares adjusted to reflect
the subsequent conversion of preferred).
Quarterly cash dividends of 25 cents per share
-or $1.00 per year-were paid on Common Stock
during 1963. An unbroken record of consecutive
quarterly cash dividends now has been main-
tained for a period of nine years.
Total net worth, or stockholders' equity, in-
creased from $59,711,883 to $68,435,947 during
the year ended December 31, 1963. This was a
net gain of $8,724,064 resulting principally from
profit for the year less dividends paid. Book val-
ue of each share of Common Stock was $37.51
at December 31, 1963, marking an increase
of $4.72 per share over the comparable book
value of $32.79 one year earlier.
Financial Position
Long-term borrowing arrangements remained
essentially unchanged during 1963 and outstand-
ing debt at the close of 1963 amounted to $72,-
735,360 of which $7,739,845 is shown in current
liabilities as maturing in 1964.
Payments on debt in 1963 included interim
repayment of $10,500,000 on bank loans under
the revolving feature of that agreement and
$2,786,013 paid on the Conditional Contracts of
Sale for Lockheed Electras. More than 60 per
cent of the latter debt now has been repaid.
At year-end your Company had on order,
for delivery in 1964, one Boeing 720B and three
Boeing 320C fan-jet aircraft at a total cost of
$28,185,000. Of this amount $8,700,000 was on
deposit with manufacturers with the balance
available from our existing credit line and from
internal cash generation.
NET EARNINGS
12.0 . . - - - - - - - - - - - - - - - - ,
10.0 t----- - - - - - - - - - - - - - 1
(J)
0:::
<t:
_J
_J 8.0 t - - - - - - - - - - ------i
0
0
LL
0
(J)
z
0
_J
_J
-
~
6.0
4.0
>---
2.0
-
0 ......_..--..___.. ........ _...__..___......._ ............... _..
1959 1960 1961 1962 1963
1963 OPERATIONS
Total transport revenues reached a new high
of $169,642,000 in 1963, showing an increase of
12.7 per cent over the total of $150,484,000 for
1962. "Milestones" were passed in two traffic
categories: Revenue ton-miles in all services ex-
ceeded the 300 million mark; revenue passenger-
miles on scheduled routes exceeded two billion.
Passenger Traffic and Revenues
In 1963 orthwest Airlines carried 2,912,000
passengers ( one-half million more than in 1962 )
for a total of 2,179,000,000 passenger-miles. The
latter measure showed a 14.4 per cent increase
over 1962. Gains generally were consistent
throughout the system with domestic and inter-
national passenger-miles up 12.8 and 19.5 per
cent, respectively. Additional service with our
expanding jet fleet brought improvement in the
competitive standing of the Company in many
areas. For example, there were substantial gains
in the Florida markets, which have been de-
veloped to a level which provides an important
seasonal balancing effect in our year-round traf-
fic.
Total passenger revenues of $135,222,000 were
11 per cent more than in 1962, a smaller per-
centage increase than the traffic gain. This
relationship was the result of a reduction in the
system average net fare per passenger-mile from
6.40 cents in 1962 to 6.21 cents in 1963. Lower
yields were caused for the most part by a num-
ber of new promotional fares introduced by
several of the other airlines primarily for com-
petitive reasons. Some of these new fares, in-
cluding the military standby rates, appear to
have had a favorable net effect on over-all reve-
nues. Others appear to have done little more
than create dilution of yield. The Civil Aeronau-
tics Board presently is conducting an investiga-
tion of some of these promotional fares.
Cargo and Charter Traffic
Increased cargo capacity made available dur-
ing the last half of the year in your Company's
new 320 series fan-jet fleet contributed to large
increases in cargo traffic during 1963. System
freight and express ton-miles were up 12.0 per
cent, including a major gain of 22.1 per cent
on the international portion of our routes. Mail
tonnage held relatively steady in 1963. Over-
all revenues from nonpassenger traffic totaled
$27,978,000 or 7.4 per cent above 1962 revenues.
In July, 1963, Northwest Airlines commenced
greatly increased charter operations for the mili-
tary establishment, utilizing jet aircraft in serv-
ices to Alaska and the Orient and DC-7C/F
piston aircraft in a mid-Pacific island schedule.
Approximately $9,300,000 in charter revenue
will be obtained from this operation in the fiscal
year ending June 30; 1964. Efforts will be made
to secure renewal of these contracts for fiscal
1965.
Operating Costs
Total operating expenses were $142,873,000
in 1963, or $11,625,000 more than in 1962. Em-
ployees' wage rates and the cost of services and
supplies increased during the year. Expanded
service to the public, reflected in a 16.4 per cent
increase in available seat-miles, also require<l
larger expense outlays. With all of these factors
combined, our total operating costs increased
by 8.9 per cent. However, unit costs declined
to a new low. Operating expense per available
ton-mile ( capacity offered) was 21.7 cents in
1963 compared with 23.9 cents in 1962. Cost per
revenue ton-mile ( traffic carried) was 46.8 cents
in 1963, reduced from 50.2 cents in 1962.
The passenger break-even load factor required
to cover operating expenses and interest costs
also declined in 1963 to 41.6 per cent. With
an actual passenger load factor of 50.6 per
cent in 1963, orthwest Airlines enjoyed a mar-
gin of 9.0 load factor percentage points above
the break-even requirement.
Along with our efforts to produce and sell
the highest quality of service possible, we are
pledged to continue our careful scrutiny of
costs and to operate with maximum economy in
all phases of our operation.
FLIGHT EQUIPMENT AT COST BREAK EVEN PASSENGER LOAD FACTOR
200 1--- - - - - - - - - - - - - -----i
175 1--- - - - - - - - - - ---1
(/) 150 > - - - - - - - --------1
0:::
<(
_j
_J 125 1 - - - - -- - - --------1
-
1-
z
w
0 50
0::: 45
w
n..
40
0
0
1959 1960 1961 1962 1963
LL
0 100 t - - - -- i
(J)
z EXPENSE PER AVAILABLE TON MILE
0 75 f - -
_j 30 1----------------------1
_j
~
50 ,___ (J)
1- 26
z
W 24
25 _ 0
22
O
L..-----------------'
1958 1959 1960 1961 1962 1963 1959 1960 1961
Source and Application of Funds for 1963
Working Capital at January 1, 1963 ......................................................................... .
Source of Funds:
T
et Earnings ................................................. ......................................................... $10,452,957
Depreciation and Amortization .......................................................................... 19,158,899
Deferred Taxes . . . ...... . . .. . . .. . ............... .... .. .... .. . . .. . . .. . . ........ ... . ...... .... . ... .. .. . . .. . ... . . . . .. ... 4,558,900
Total from Operations ...... .................................................................... ........ $34,170,756
Disposals of Operating Property .......................................................................... 21,738,798
Other Sources ......................................................... .............. ................................. 310,932
Total Funds Available ................................................................................. .
Application of Funds:
Addition to Operating Property .......................................................................... $36,031,451
Advance Depo its on Aircraft .............................................................................. 8,699,753
Reduction of Long-Term Debt .......................................................................... 9,972,013
Cash Dividends ...................................................................................................... 1,822,656
Other Applications ............................... ................ ................................................. 1,517,136
Working Capital at December 31, 1963 .................................................................. ..
1962 1963
$ 8,049,066
56,220,486
$64,269,552
58,043,009
$ 6,226,543
FLEET
i
orthw t Airlin s during 1963 took delivery
of fiv intercontin ntal-range Boeing fan-jet
707-320B airliners. Th e aircraft, put into serv-
ic on rout to Alaska and the Orient, enabled
your Company to provide an all-jet patt rn of
r ic in the Pacific.
nother important development in orth-
west's fleet which took place in 1963 was the
al of th airlines remaining four DC-8 turbojet
aircraft to another carrier. Three were delivered
during th year, with the fourth-retained for use
in tran -Pacific conhact operations for the Mili-
tary Air Transport Service-to be delivered next
June 30.
Sale of the DC- fl et was important in two
ways: ( 1) It enabled orthwest to standardize
on Bo ing equipment with resulting economies
in pare parts inventories and maintenance facili-
ti s. ( 2 ) The DC-8 sale made it possible for
~orth, e t to provide fan-jet aircraft on all of
it comm rcial jet s 1-vices, using Boeing 320B
and 720B aircraft. During 1963 and early 1964,
::--Jorthwest al o old and delivered three piston-
engined DC-6B transports. Proceeds from sale
of these aircraft have been utilized in our equip-
m nt program.
ltoaether, with the 720B's obtained in prior
years th five 320B's delivered in 1963 and an
additional 720B delivered early in 1964, 1 orth-
w t at present operates a total of 19 fan-jet
aircraft in addition to the one DC-8 turbojet
on military flights. Your Company also operates
a fleet of 16 fast jet-prop Electra II aircraft, 6
DC-7C' and 8 DC-6B s, two of which have been
sold and will be delivered to the purchaser in
Ma and Jun 1964.
In April, May and June, 1964, Northwest will
take deliv ry of three additional intercontinen-
tal Boeing fan-jets. These aircraft, 320C con-
vertible cargo-passenger aircraft, will be used to
increase both passenger and cargo lift across
the Pacific.
Looking even farther into the future, orth-
west during 1963 deposited $400,000 with the
Federal Government to rese1-ve delivery positions
on four supersonic transports for the early 1970's.
FACILITIES
The year 1963 saw a continuation, on the part
of Northwest Airlines and the managements of
the airports it serves, of the years-long program
of improving ground facilities in the interests
of customer convenience and more efficient
operations.
We occupied new terminal structures at Win-
nipeg and Tokyo in 1963. In early 1964, new
terminals were opened at Taipei and Grand
Forks. Spokane began construction of a new
terminal during 1963 and Bismarck is scheduled
to undertake similar work in spring, 1964.
Complete restaurant facilities were opened in
orthwest's new unit terminal at John F. Ken-
nedy International Airport, ew York.
Top Flight Loaders-enabling jet passengers to
walk directly from terminal concourse levels
into airliner cabins without exposure to the
weather or climbing stairs-proved to be so
popular at Seattle-Tacoma, Minneapolis-St. Paul,
Chicago 1 ew York and Miami in 1963 that their
installation at Detroit and Portland has been
programmed for 1964.
A new city ticket office was designed and oc-
cupied at Cleveland.
In the past five years we have occupied our
new Main Base at Minneapolis-St. Paul and
new or substantially improved terminal facilities
at most of our major stations.
PERSONNEL
Northwest Air lines' highly experienced and
efficient work force has utilized an excellent
Beet of aircraft and ground facilities of match-
ing caliber to continue the airline's high stand-
ards of efficient and convenient service to the
public.
The airline's system-wide force of 6 090 em-
ployees-a net increase of 302 persons-represents
in the aggregate more than 57,000 years of ex-
perience with the Company, providing the foun-
dation for the service and airmanship that
contributed to the success of your Company in
1963. The average length of service for our
employees is more than nine years.
Further contributing to the stability of your
Company's work force, collective bargaining
agreements were reached during the year with
11 classes or crafts of employees providing for
reasonable rules, working conditions and rates
of pay. Major agreements were signed for three-
year terms.
Early in 1964, agreement was also reached with
the pilot group on a new, 43-month conh act
which will run until September 1, 1965.
orthwest during 1963 took a major step
toward insuring for future years a ready pool
of qualified and experienced personnel for man-
agement positions by the introduction of a for-
mal management selection and development pro-
gram. Included as one of its features is the
recruitment of promising college graduates from
campuses across the nation. Young men who
have completed their initial training under this
program have been assigned to positions in the
Sales, 1aintenance & Engineering and Finance
Departments where they will continue to de-
velop their management capabilities.
This new plan for personnel development is
in addition to our long-established training pro-
gram under which all employees are instructed
in the latest techniques to insure continued safe
and efficient operation of the airline.
EMPLOYEES BY LENGTH OF SERVICE
25 years or more...................................... 92
20 to 25 years................................. ........... 556
15 to 20 years............................................ 883
10 to 15 years ............................................ 1,121
5 to 10 years............... ............................. 867
1 to 5 years ............................................ 1,880
Less than 1 year...................................... 691
Total .. .. ..... 6,090
Ten Years of Revenue and Traffic Growth
Traffic-Scheduled Services
Total Ton-Miles
Operating Passenger Freight and
Year Revenues Miles Express Mail
1963 $168,788,040 2,179,208,000 39,417,000 33,665,000
1962 150,453,420 1,904,112,000 35,179,000 33,635,000
1961 111,052,512 1,361,790,000 23,035,000 26,955,000
1960 123,361,479 1,653,966,000 32,480,000 24,424,000
1959 126,029,501 1,738,138,000 31,377,000 24,436,000
1958 101,957,172 1,408,743,000 22,285,000 21,892,000
1957 83,432,404 1,205,765,000 19,714,000 17,803,000
1956 76,479,526 1,094,121,000 18,825,000 16,780,000
1955 71,088,043 1,017,400,000 16,341,000 15,407,000
1954 62,138,312 909,675,000 12,970,000 6,990,000
CUSTOM ER SERVICES
Expansion of Northwest Airlines' jet capabili-
ties in 1963 provided a number of significant
schedule improvements better to serve the in-
creasing volume of passengers and shippers re-
sponding to the advantages of air transportation.
In response to the growing service needs of
our domestic routes, we added jet and jet-prop
frequencies in a number of markets. In the
Detroit->;ew York market, for example, we in-
creased daily flights by 60 per cent and capacity
from 687 seats a day in January, 1963, to 1,306
seats daily in January, 1964, schedules. In order
to increase service in our Florida markets, we
provided a total of 16 one-way flights a day b e-
tween Chicago and Florida points during the
l1eight of the current winter season.
In :\fay, 1963, by scheduling an eighth trans-
Pacific jet frequency each week and assigning
720B fan-jets to interport flights beyond Tokyo,
we achieved an all-jet pattern of Orient services.
Delivery of longer-range 707-320B aircraft en-
abled the Company to inaugurate in 1 ovember
the first regular nonstop service in both direc-
tions bet\veen the West Coast of the nited
States and Tokyo.
The new 707-320C fan-jets which Northwest
will acquire during the spring of 1964 will permit
an increase in trans-Pacific schedules to 12 round
trips weekly bet\veen the United States and the
Orient to fulfill the need for passenger and cargo
lift across the Pacific. At least seven of these
round trips each week will be on the nonstop
routing benveen Seattle-Tacoma and Tokyo,
with the remainder operating nonstop benveen
Tokyo and Anchorage.
The new 320C's-with a large-door forward
cargo area-will be operated in a basic con-
figuration providing more than 30,000 pounds
of cargo capacity and 96 passenger seats in an
all-economy configuration. Main deck cargo will
be carried on preloaded pallets. This arrange-
ment may be varied by relocating the bulkhead
separating passengers from cargo, to provide for
capacity ranging from 165 passengers to an all-
cargo load of 90,000 pounds.
~orthwest also increased its fan-jet service
to H awaii, and in the present winter vacation
season is operating eight round trips a week in
the market-seven of which are through-plane
flights between ;\ew York and H onolulu, via
Chicago and the Pacific Northwest cities of Seat-
tle-Tacoma and Portland.
orthwest's in-flight operation, as well as
ground handling of both passengers and cargo,
were praised repeatedly through the year by
customers appreciative of the continued high
standards of your Company's public service.
MAINTENANCE
0;orthwest Airlines' highly skilled maintenance
personnel, working with dependable jet equip-
m nt, have compiled an enviable record of per-
formance. For example, in the three months
bracketing the end of 1963, N'orthwest's turbine-
engine reliability was among the best in the in-
d us try.
The ~ orthwest Airlines continuous overhaul
maint nance program, which in prior years
proved to be so uccessful on pure jet aircraft,
was extended to the Ekctra fleet in 1963. This
program provides for more efficient maintenance
of aircraft by combining with routine check
maintenance, performed every 260 flight hours, a
portion of the major overhaul program formerly
accomplished by removal of the aircraft from
ser ic for an extended period. The additional
flying time made available by this method serves
to increase re enue utilization of aircraft.
The JT3D-l fan engines which power our 720B
airliners have undergone modification in our
Main Base shops to JT3D-3 configuration to in-
crease their thrust to 18,000 pounds from the
original 17,000 pounds at which they were rated
when this type of aircraft was delivered to orth-
west. In addition, thi modification has enabled
us to use these engines interchangeably on 707-
320-type aircraft as well as on the 720B, thus
taking further advantage of our standardization
on Boeing equipment.
CHINA
Hong Kong

PHILIPPINES
KOREA
Okinawa
SYSTEM MAP UNITED STATES
Honolulu
HAWAII
Newark
Washington
St. Petersburg
Clearwater
SALES ACTIVITIES
Aggressive and imaginative sales work and
advertising contributed materially to the finan-
cial success of Northwest Airlines during 1963.
Gross revenues for the year exceeded the com-
pany forecast.
Several new techniques of selling were added
during the year. One of these was the travel
agent seminar program. Teams of experts rep-
resenting orthwest and prime vacation desti-
nations visited major cities across the nation.
Travel agents in the cities attended seminars at
which the exp rts pre ented information in depth
on the area being covered, as well as on orth-
west' s schedules to and from the area. Travel to
Alaska was the subject of the spring seminar
program and the Orient was covered in the fall.
The program will be continued.
Special promotional programs were held in
major Midwest and Florida cities, in advance of
the winter vacation season, to advise travel
agents and other customers of our attractive
schedule of flights in the Florida market.
Advertising during the year was related closely
to the over-all sales effort. The Florida cam-
paign-featured by an upside-down map of the
United States so as to show a jet literally
heading "northwest" to the Sunshine State-par-
ticularly attracted widespread attention.
Two major events on Northwest's routes in
1964-the ew York World's Fair and the
Olympic Games in Tokyo-will receive special
attention in our sales efforts this year. Promo-
tional work for both attractions got under way in
mid-1963. Objective of sales, advertising and
public relations activities is to build an identity
for orthwest in connection with both events.
orthwest was granted official status as a
World's Fair ticket and information center and
the airline contracted to sponsor an exhibit in
the Transportation & Travel Pavilion at the fair.
1 orthwest already has a large number of tour
groups booked to the Olympic Games.
Heavy emphasis continued on the sale of group
tours, to Hawaii, Alaska, the Orient and various
domestic destinations. This program-including
the sale of tours through radio stations and other
public media-conhibuted materially to the
growth of Northwest's passenger revenues.
In its freight program, T
orthwest emphasized
the sale of volume cargo to and from the Orient
through the ew York and Chicago gateways,
utilizing the additional lift provided by the big-
door, 707-320B fan-jets. Throughout the system,
sales effort has been pointed toward informing
shippers of the advantages of consistent use of
air fre'ght as a regular rather than occasional
method of dishibution.
J;::j.
RYING SOUlll TO FLORIDA? GO NORTHWEST r
NOW ITS A FAN-JET WORLD!
FLY NORTHWEST- THE FAN >-JET A/RUNE
,~
' ,
-
~--------
NORTHWEST
ORIENT Al RU N CS
(Any U, }'Oil loolc ai tt. Northwest Is yoor best way to Florida)
You're up to
2,000 miles
e
closer to 1 ,
the Orient -
on Northwest
. '
.
YOUR NORTHWEST JET
IS ALWAYS A FAN~ETI
E IN HISTORY
KYO/SEATTLE
llll'fSn U
f A!f J1SUYICl
1-00.l"O~HU
~-
\.. NORTHWEST ORIENT - TH FAN >
JU A/RUNE
\... NORTHWEST ~,~:~N~~
THE FAN >-JU A/RUNE
ROUTES
There were no significant changes in or addi-
tions to the routes of Northwest Airlines in 1963.
On ovember 8, 1963, the Civil Aeronautics
Board, with the approval of the President of the
United States, ordered the Transpacific Case
terminated. No additional authority was award-
ed to any applicant in areas affecting orthwest
in either the so-called "international" or "domes-
tic" (California-Hawaii) phases of the case. One
of the carrier applicants and certain civic bodies
have petitioned for judicial review, limited, how-
ever, to the denial of new California-Hawaii au-
thority. This matter still is pending before the
Court.
In May, 1963, an Examiner of the Civil Aero-
nautics Board issued his initial decision in the
United Air Lines Competitive Service Investiga-
tion, in which he found that orthwest should
be granted authority to serve the Cleveland-Chi-
cago, Cleveland-Philadelphia and Dehoit-Phila-
delphia markets, but that another carrier should
be authorized to serve the ew York-Cleveland
market in which orthwest also had sought
authority. Thereafter, the Board ordered review
of the Examiner's initial decision on all issues.
In the review proceeding, 1 orthwest vigorously
pursued its application for the ew York-Cleve-
land authority as well as rights in the other mar-
kets. Oral argument was heard in ovember,
1963, and the matter now is awaiting the Board's
decision.
Directors, officers and employees of
Northwest Airlines were shocked and sad-
dened by the death, on January 1, 1964, of
Mr. Willwm Stern, director of Northwest
since August 29, 1938.
"Bill," as he was known to his many
friends in all walks of life, was President
of the Dakota National Bank of Fargo,
North Dakota, and had an important part
in many state and national affairs during
his lifetime. His long time interest in the
Company's affairs and his outstanding abil-
ities were major contributors to the growth
of the Company.
As previously reported, the CAB instituted a
proceeding for study of possible revision of the
route structure between the Pacific orthwest
and Alaska. Hearings were held before a CAB
Examiner during the year in which Northwest
vigorously opposed any restriction on its exist-
ing authority as being without valid basis. In
addition, orthwest maintained that such re-
striction would not be necessary to solve the
difficulties other carriers serving the area might
be encountering. The matter is awaiting the
Examiner's initial decision.
During the year the CAB disapproved a pro-
posed merger between American Airlines and
Eastern Air Lines which would have created a
giant carrier controlling nearly 35 per cent of
domestic trunkline business. This merger was
opposed by orthwest as well as by most of the
other hunkline carriers. In addition, Pan Amer-
ican World Airways and Trans World Airlines
withdrew their application for approval of a pro-
posed merger in light of developments subse-
quent to its submission.
In an initial decision in the Service to Spokane
Case, served in September, 1963, an Examiner of
the CAB proposed additional route authorities
for two air carriers which compete with North-
west at that important city. The Examiner pro-
posed that West Coast Airlines, a local service
carrier, be granted nonstop rights in the
Spokane-Seattle/ Tacoma and Spokane-Portland
markets, and that United Air Lines be given non-
stop authority from Spokane to California and
from Spokane to Salt Lake City and Denver-the
latter permitting United to fly one-stop from
Spokane to Chicago. Northwest Airlines and
other parties petitioned the CAB for a discre-
tionary review of the Examiner's decision; such a
review was ordered and argument was presented
before the Board in February, 1964.
There are several other proceedings pending
before the Board in which orthwest is a par-
ticipant, either as an applicant or in opposition
to competitive authorizations. one of these
has an importance comparable to the proceed-
ings mentioned above.
In addition to the applications being heard in
the United Competitive Service Investigation,
Northwest has on file with the CAB a number of
applications for new route authority which
would strengthen its route structure, particularly
its dome tic system.
STATEMENT OF EARNINGS
NORTHWEST AIRLINES, INC. and SUBSIDIARY
Year Ended December 3 I,
OPERATING REVENUES
Transport:
Pas ng r . .
nit d Stat s mail
For ign mail . .
Exe baaaag
Fr iaht and x--pr ss .
ChaTt r and oth r transportation
Non transport:
Mutual Aid Agre m nt-n t- ot F
Fed ral mail subsidy- ot E
Other . . . . . . . .
OPERATING EXPENSES
Flying op rations .
t,.faint nanc
Passenger rvice .
Aircraft and traffic r icing
Res rvations sales and ad ertising
Administrath and g n ral
D epreciation and amortization
OTHER INCOME AND (DEDUCTIONS)
Interest on long-t rm debt
Disposals of property
Other income . . . .
EARNINGS BEFORE TAXES
TAXES ON EARNINGS (including d erred tax s $4,336,900
-1963; $5,812,900-1962 arising principally from ace I r-
ated d pr ciation methods and in estm nt er dit)
1963
$135,..,..,.., 11
L.917,441
1316 118
1146,730
12 597 52
6 441.700
$169.641,635
(
(
$16
$ 4...,,906,...,11
26 203 309
11,412 619
19 690 557
16,9 5 125
6,515 803
19 15 899
$14..., 87 ...,,523
$ 25 915,517
($ 3, 76,7 9)
( 307 732)
19 261
($ 4,165,-"60)
$ 21,750 257
- ote G . . . . . . . . . . . . . . . . . 11 297 300
NET EARNINGS FOR THE YEAR $ 10,452 957
See notes to financial statements.
1962
$Ll,7 l 068
L ,90-1,069
l 3.A,347
1,0 3,96
10 744 241
2.646,207
$150 4 3.900
AO
$ 3 , 47,73...,
23 243,505
9 5 6 053
17 658 4 7
15 6 7 673
7,678 7...,9
18,445,190
$131,....47 369
$ 19,...,06,051
($ 5 040,...,66 )
346 352
116 555
($ 4 77, 59 )
$ 14 628 692
7 398 300
$ 7,230 392
ST A TEMENT OF FINANCIAL POSITION
ASSETS
CURRENT ASSETS
Cash .
ote rec iva ble from sale of aircraft
Trade r ceivables, less allowance of 105,000
Flight equipment parts at average cost, less allowance for
depreciation ( 1963- 2,765,206 1962-$2,529 171 )
Maintenance and operating supplies at average cost . . .
Prepaid expenses . . . . . . . . . . . . . . .
TOTAL CURRENT ASSETS
INVESTMENTS AND OTHER ASSETS at cost
Related indu try investments and other advances
PROPERTY AND EQUI PMENT at cost
Flight quipment . . . . . . . . . . . .
Less allowances for depreciation and obsolescence .
Advance on purchase contracts- ote D . . . .
Other property and equipment
Le s allowances for depreciation
DEFERRED CHARGES
namortized training and other costs in connection with
aircraft Beets
Rentals
Other
See notes to financial statements.
December 31,
1963
$ 12,866,565
6,911,619
15,248 025
6,100,076
2,176,335
2,706,816
$ 46,009,436
$ 638,615
$176,654,741
49,580,630
$127,074,111
8,699,753
$135,773,864
$ 21,523,556
12,031,320
$ 9,492,236
$145,266,100
$ 3,885,157
965,385
$ 4,850,542
$196,764,693
1962
$ 16,371,029
14,037,703
6,475,526
2,181,111
2,414,788
$ 41,480,157
$ 320,332
$169,413,299
46,433,719
$122,979,580
6,327,901
$129,307,481
$ 21,103,687
10,751,430
$ 10,352,257
$139,659,738
$ 4,461,405
890,756
74,214
$ 5,426,375
$186,886,602
NORTHWEST AIRLINES, INC. and SUBSIDIARY
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Trade accounts payable . . . . . . . . . .
Collections as agent ( taxes, payroll deductions, etc. )
Accrued taxes ( other than income taxes )
Salaries, wages and vacations
Air travel card deposits . . . . .
Unredeemed ticket liability . . . .
Income taxes-estimated . . . . .
Current maturities of long-term debt
TOT AL CURRENT LIABILITIES
LONG-TERM DEBT, less current maturities- ote A
1otes payable to insurance companies
otes payable to banks . .
Subordinated note payable .
Conditional sales contracts
DEFERRED CREDITS- ote G
Income taxes-arising principally from accelerated deprecia-
tion methods
Other
STOCKHOLDERS' EQUITY- ote B
Cumulative Preferred Stock, $25 par value, authorized
1,000,000 shares, outstanding none:
Shares outstanding were called; 70 shares were re-
deemed and 449,545 shares were converted into
432,254 Common Shares . . . . . . . . . . .
Common Stock, $10 par value; authorized 4,500,000 shares;
issued and outstanding 1963-1,824,452 shares; 1962-
1,388,459 shares- ote C
Capital surplus .
Retained earnings . . .
COMMITMENTS AND CONTINGENT LIABILITIES- ote D
See notes to financial statements.
December 31,
1963 1962
$ 10,662,050 $ 8,428,916
2,488,578 2 624,246
1,316,345 2,048 746
7,764,811 5,584,258
1,195,100 1,187 875
1,865,862 1,038 843
6,750,302 1,464,362
7,739,845 11,053,845
$ 39,782,893 $ 33,431,091
$ 40 000,000 $ 40,000,000
19,000,000 21000,000
2,314 000 7,500 000
3,681,515 6,467,528
$ 64 995,515 $ 74 967,528
$ 20,707,800 $ 17,450,100
2,842,538 1326,000
$ 23,550,338 $ 18,776100
$ $ 11,240 375
18,244 520 13,884,590
13 587113 6,612 905
36,604,314 27,974,013
$ 68,435 947 $ 59,711,883
$196 764,693 $186,886 602
ST A TEMENTS OF CAPITAL SURPLUS
AND RETAINED EARNINGS
NORTHWEST AIRLINES, INC. and SUBSIDIARY
Year Ended December 31,
CAPITAL SURPLUS 1963 1962
Balance at beginning of year
Additions arising from:
$ 6,612,905 $ 6,586,281
Sale of shares of Common Stock under option agreements,
in excess of par .
Redemption of shares of Preferred Stock and conversion
into shares of Common Stock .
58,213
6,915,995
1,710
24,914
Balance at end of year . $ 13,587,113 $ 6,612,905
RETAIN ED EARNINGS
Balance at beginning of year
Add net earnings for the year
$ 27,974,013 $ 22,445,364
10,452,957 7,230,392
$ 38,426,970 $ 29,675,756
Deduct cash dividends on:
$ $ 592,187
5J~% Preferred Stock-annual rate of $1.3rn a share
Common Stock-$1.00 a share ( $.80 for 1962) 1,822,656 1,109,556
Balance at end of year .
See notes to financial statements.
ACCOUNTANTS' RE.PORT
To the Stockholders and Board of Directors
Northwest Airlines, Inc.
Saint Paul, Minnesota
$ 1,822,656 $ 1,701,743
$ 36,604,314 $ 27,974,013
We have examined the statement of consolidated financial position of Northwest Airlines, Inc., and
subsidiary as of December 31, 1963 and the related statements of consolidated earnings, capital sur-
plus and retained earnings for the year then ended. Our examination was made in accordance with
generally accepted auditing standards, and accordingly included such tests of the accounting rec-
ords and such other auditing procedures as we considered necessary in the circumstances. W e
have made similar examinations for prior years.
In our opinion, the accompanying statements of financial position, earnings, capital surplus and re-
tained earnings present fairly the consolidated financial position of Northwest Airlines, Inc., and
subsidiary at December 31, 1963 and the consolidated results of their operations for the year then
ended, in conformity with generally accepted accounting principles applied on a basis consistent
with that of the preceding year. Further, it is our opinion that the five year summary of earnings
presents fairly the information stated therein.
Saint Paul, Minnesota
February 12, 1964 Certified Public Accountants
NOTES TO FINANCIAL STATEMENTS
NORTHWEST AIRLINES, INC. and SUBSIDIARY
December 31, 1963
Note A- Long-Term Debt
Under ote Purchase Agreements with twelve in-
surance companies the Company has borrowed $40,-
000,000 at 6% payable $3,000,000 annually beginning
October 1, 1966 and $4,000,000 on October 1, 1978.
Certain optional prepayments at par are permitted.
The Agreements contain other provisions with re pect
to redemption as a whole, but not from borrowed
funds, at premiums ranging from 5% to 1%
.
Under the Amendatory Credit Agreement with fifteen
banks the Company has outstanding $19,000,000. This
Agreement provides for revolving credit of $34,000,000
at December 31, 1963, reducing to $31,875,000 on
June 30, 1964, to $27,625,000 on September 30, 1964
and to $25,500,000 on December 31, 1964. On the
latter date the loan, to the extent then out tanding,
become a term loan at 5%, payable $8,500,000 in
each year 1965 through 1967. Optional prepayments
are permitted at par, except that prepayments with
fund borrowed from other banks are subject to a
premium of %.
Subordinated note payable of $7,500,000 was is ued
in connection with the purchase of six Boeing 720B
turbojet aircraft and is subordinate to notes payable
to insurance companies and to banks. This note bears
interest at 6% and is payable $1,500,000 annually 1968
through 1972. In addition, the note provides for pre-
payments ( based on net earnings) to be applied to the
reverse order of maturities. Payments totaling $5,186,-
000, ba ed on net earnings of 1963, will be required in
1964 if at the dates for payment they are permitted by
pro i ion of agreements of superior indebtedness.
Conditional sales contracts for the purchase of seven
Lockheed Electra prop-jet aircraft bear interest at 5%
and are payable in monthly installments to June 10,
1966.
The aggregate repayment of long-term debt over the
years 1964 through 1969 i $7,740,000 in 1964, $13,-
600,000 in 1965, $12,400,000 in 1966, $5,000,000 in
1967 and $3,000,000 in 1968. The foregoing assumes
that $2,314,000 of the ubordinated note payabl will
become payable in 1965.
Under provisions of long-term debt agreements the
Company has agreed, among other things, that it will
not permit its working capital at any time to be les
than certain specified amount and its funded debt to
exceed certain percentages of net tangible a et , of
net worth and of depreciated value of flight equipment,
as tho e term are defined in the agreement . At D e-
cember 31, 1963 the Company had complied with
the covenants then in effect.
The ote Purcha e Agreem nts and the Amenda-
tory Credit Agreement e tabli h an aggregate dollar
maximum for the declaration and payment of ca h
dividends on Common Stock, and for the distribution
on, redemption, purcha e or other acquisition of hares
of any cla s of Capital Stock. The amount of retained
earnings available for such purposes at December 31,
1963 was $7,152,949.
ote ommon tock Option and
At December 31, 1963, 6,762 unissued hares of
Common Stock were subject to outstanding option ,
exercisable by Company officers and employee at
$27.45 a share which price was not less than 95% of
the market when the options were granted during 1962.
Options for 2,050 shares expire in 1965 and for
4,712 shares in 1966. Options for 500 shares at $13.42
and for 3,238 shares at $27.45 were exercised during
the year. An additional 150,000 shares are reserved for
irnilar options which may be granted to officers and
employees in th future.
ote - Conumtments and Contingent
abili( e~
The Company has purcha ed one Boeing 720B turbo-
jet aircraft for delivery in the first quarter of 1964 for
$5,607,000 and three 320C turbo-jet aircraft for de-
livery in the second quarter of 1964 for $22,578,000.
Deposits on these purchases aggregated $8,699,753 at
December 31, 1963.
Annual payments of approxirnat ly $3,100,000 are
required und r variou rental agreements for lease from
five to thirty-five years for airport facilities, ticket of-
fices, etc.
The Company was contingently liable at December
31, 1963 in the amount of $409,038 resulting from di -
counting notes receivable arising from the sale of assets.
Other contingent liabilities include those inherent in the
Company's operation. While the amount of these con-
tingent liabiliti s is not now determinable, the manage-
ment of the Company is of the opinion that it is not
material with re pect to the Company's financial posi-
tion.
C oe!lsa ion
o final determination of total mail compensation ha
been made by the Civil Aeronautics Board on inter-
national and domestic routes for 1951. The ultimate
effect of any redetermination i not known at this time.
Pursuant to an order issued by the Civil Aeronautics
Board, the Company has made provision in 1963 for
the reduction of $1,833,123 of mail subsidy for 1954
which amounts to a reduction in net earnings of
$843,000 after applicable income taxes.
e
The Company is party to a Mutual Aid Agreement
with certain airline under which any party to the
agreement uffering a trike a defined therein is to
receive from the other airlines amounts as determined
under the agreement. The Civil Aeronautic Board is
investigating the agreement and in the event of it dis-
approval, Mutual Aid payments are to be refunded to
the paying airlines to the extent affected by such dis-
approval. At December 31, 1963 the Company is a
net beneficiary under the 0-f utual Aid Agreement to
the extent of $2,615,123.
The Company's investment credit was $2,929,600 for
1963 and $300,000 for 1962 and has been added to
deferred taxes and other deferred credits, the latter
to b r ported a earned income ov r eight year period
from the respective year in which the credit ari es.
$106,400 of other deferred credits have been reported
as earned in 1963 and $18,000 in 1962. Taxe on earn-
ings charged to the Statem nt of Earnings include d -
erred taxes of $2,823,200 for 1963 and $282,000 for
1962 ari ing from the in e tment er dit.
FIVE YEAR SUMMARY OF EARNINGS
(Amounts Shown in Thousands)
NORTHWEST AIRLINES, INC. and SUBSIDIARY
1963 1962 1961 1960 1959
OPERATING REVENUES
Transport:
Passenger $135,222 $121,781 $ 85,971 $ 97,680 $100,641
United States mail 12,917 12,904 10,474 9,680 10,174
Foreign mail . 1,316 1,324 1,227 1,031 1,045
Excess baggage . 1,147 1,084 914 1,183 1,349
Freight and express 12,598 10,744 7,529 10,185 10,532
Charter and other transportation . 6,442 2,646 1,482 823 526
$169,642 $150,483 $107,597 $120,582 $124,267
Non transport . ( 854 )( 30) 3,456 2,780 1,763
$168,788 $150,453 $lll,053 $123,362 $126,030
OPERA Tl NG EXPENSES
Flying operations $ 42,906 $ 38,948 $ 29,269 $ 37,606 $ 37,610
Maintenance . 26,203 23,243 17,253 22,872 21,771
Passenger service ll,413 9 586 7,178 8,840 8,465
Aircraft and traffic servicing 19,690 17,658 12,446 15,422 15,5ll
Reservations, sales and advertising 16,985 15,688 ll,973 13,789 14,0ll
Administrative and general 6,516 7,679 6,094 5,926 6,443
Depreciation and amortization 19,159 18,445 17,118 14,413 ll,310
$142,872 $131,247 $101,331 $ll8,868 $ll5,121
$ 25,916 $ 19,206 $ 9,722 $ 4,494 $ 10,909
OTHER INCOME AND (DEDUCTIONS)-NET ( 4,166) ( 4,578 ) ( 2,828) ( 1,882 ) 335
EARNINGS BEFORE TAXES $ 21,750 $ 14,628 $ 6,894 $ 2,612 $ ll,244
INCOME TAXES 11,297 7,398 3,233 986 5,530
NET EARNINGS FOR THE YEAR $ 10,453 $ 7,230 $ 3,661 $ 1,626 $ 5,714
OTHER FINANCIAL STATISTICS
Cash dividends paid ( 000 ) . $ 1,823 $ 1,702 $ 1,701 $ 1,700 $ 1,714
Earnings per share O O

5.73 3.97 2.01 .89 3.14
Stockholders' equity ( 000 ) . 68,436 59,712 54,177 52,193 52,267
Book value per share00
.
37.51 32.79 29.76 28.70 28.74
Cash ( 000 ) . 12,867 16,371 15,991 18,360 10,206
et working capital ( 000 ) 6,227 8,049 7,034 23,008 12,093
Flight property at cost ( 000 ) 176,655 169 413 170,772 121,441 104,389
Flight property at net book value ( 000 ) . 127 074 122,980 133,485 86,957 76,647
Total assets ( 000 ) 196,765 186 887 189,103 148,698 130,097
Long-term debt ( 000 ) 64,996 74,968 90,286 68,500 50,000
Operating expenses:
Per available ton-mile 21.7 23.9 27.6 27.8 26.5
Per revenue ton-mile . 46.8 50.2 54.2 54.2 51.0
Break-even pa senger load factor 41.6% 45.5% 48.9% 53.7% 51.1%
( to cover operating expen es and interest)
Actual passenger load factor 50.6% 51.5% 52.1% 53.8% 55.2%
Available seat miles ( 000 ) 4,305,147 3,697,796 2,6ll,840 3,073,400 3,149,000
0 Operations were curtailed in the first quarter of 1961 as a result of a flight engineer strike.
00 1959-1962 based on total number of shares outstanding at end of year plus shares arising from subsequent con-
ersion of preferred stock issued in December, 1958, and called in January, 1963.
Northwest Airlines, Inc.
DIRECTORS*
CROIL HU?\TER
Chairman of the Board, ~orthwest Airlines, Inc:.
St. Paul, 0-linnesota
JA\IES H . BI T
GER
President, \Iinneapoli -Honeywell Regulator Co.
\1inneapolis, 0-1innesota
HADLEY CASE
President, Case, Pomeroy & Company, Inc.
, 'e\\ York, :\'ew York
\!ORTO?\ H . FRY
Senior Partner, Riter & Company
"\ew York, 0Jew York
JOSEPH T. JOH1 SO1
Chairman of the Board, The Milwaukee Company
\Iilwaukee, 'Wisconsin
:\IALCOD.f S. :MACKAY
President, Foothills Company
Roscoe, \1ontana
CLYDE B. MORGAN
Chairman of the Board, Rayonier Incorporated
. 'ew York, :\'ev .. York
OFFICERS*
DO. 'ALD W . NYROP
President
PAULL. BENSCOTER
Vice President-Transportation Services
ROBERT A EBERT
Vice President-Personnel
A
.. E. FLOA0J
Vice President and Secretary
DONALD H . HARDESTY
Vice President- Finance and Treasurer
\DI. E . HUSKII\'S, JR.
\'ice President- Orient Region
DO:\'ALD W . :\'YROP
President, ;\' orthwest Airlines, Inc.
St. Paul, \1innesota
ALO. zo PETTEYS
Pre idcnt, Farmers State Bank
Brnsh, Colorado
C. FRA:\'K REA VIS
Partner, Reavi. and \1cGrath
:\'e,, York :\'e\\' York
ALBERT G. REDPATH
Partner, Auchincloss, Parker & Redpath
:\'ew York, ?\cw York
LY\IA:\' E. WAKEFIELD, JR.
\'ice President, First 0Jational Bank of Minneapolis
\1inneapolis, \Iinnesota
A.LBERT J. WEATHERHEAD, JR.
President, The Weatherhead Company
Cleveland, Ohio
FRA:'--JK C. JUDD
Vice President-,\1aintenance and Engineering
\1. JOSEPH LAPENSKY
Comptroller
RO?\ALD :\fcVICKAR
Assistant Vice President
DALE \!ERRICK
Vice Pre iclent- Properties
j\1ORY T. :\'U:\':\'ELEY, JR.
Yice President and General Counsel
C. L. STEW ART
Vice Pre ident-Economic Planning
ROBERT J. WRIGHT
Yice Pre ident- Sales
0 As of March 1, 1964
REGISTRAR: The Chase Manhattan Bank, New York, N. Y.
TRANSFER AGENT: Bankers Trust Company, New York, N. Y.
STOCK LISTED: Common Stock listed on New York Stock Exchange
and Midwest Stock Exchange.
General Offices
Minneapolis-St. Paul International Airport, St. Paul, Minn. 55111
ANCHORAGE FT. LAUDERDALE MILWAUKEE ST. PETERSBURG
ATLANTA GRAND FORKS MINNEAPOLIS SEATTLE
BILLINGS GREAT FALLS MISSOULA SEOUL
BISMARCK HELENA MOORHEAD SPOKANE
BOZEMAN HOLLYWOOD NEW YORK TACOMA
BUTTE HONOLULU NEWARK TAIPEI
CHICAGO JAMESTOWN OKINAWA TAMPA
CLEARWATER MADISON PITTSBURGH TOKYO
CLEVELAND MANDAN PORTLAND WASHINGTON, D. C.
DETROIT MANILA ROCHESTER WINNIPEG
FARGO MIAMI ST. PAUL YAKIMA