7500 Airline Drive  Minneapolis, Minnesota 55450  612-726 7411 
Letter to stockholders ............................ 1 
1983 in review .................................. 2 
The future ...................................... 8 
Management's discussion and analysis ............... 9 
Financial statements ............................. 12 
Auditors' report ................................ 16 
Supplemental stockholder information .............. 21 
Five-year summary ............................. 24 
Board of Directors and Officers ................... 25 
About Republic 
Republic Airlines-the nation's sixth-largest passenger 
carrier-provides safe, dependable air service to the traveling 
and shipping public. In 1983, Fortune magazine listed 
Republic as the I 5th-largest transportation company in the 
United States. 
Originally called Wisconsin Central Airlines, the company 
inaugurated scheduled service on February 24, 1948. The 
name was changed to North Central in 1952. Southern 
Airways , which began operations in 1949, was merged into 
the company in 1979, and the name became "Republic." 
Hughes Airwest, which also had over 30 years of experience, 
was acquired in October 1980. 
Republic serves 140 cities- more than any other airline in 
the country- including most of the nation's metropolitan 
areas and many intermediate-sized communities. Its 
104,000-mile route system extends coast-to-coast, and from 
Canada to Mexico and the Cayman Islands in the Caribbean. 
(See map, inside front cover.) 
The company carried 17. 8 million passengers in 1983, and 
operates the seventh-largest commercial jet fleet in the world. 
Its 163 aircraft- Boeing 727s, Douglas DC-9s and Convair 
580s- make 1,300 departures daily. 
Republic's 14,200 dedicated employees offer the finest type 
of scheduled airline service. 
BOSTON 
TON, D.C. 
iT PALM BEACH 
:r LAUDERDALE 
.LYWOOD 
Ml 
 To our stockholders, employees and friends:  
Republic Airlines and its 
employees are moving toward 
agreement on a three-year 
Partnership Plan which should lead 
to sustained profitability. The 
airline would be more competitive 
with reduced operating costs and 
would have the potential to increase 
revenues. Such a plan became 
mandatory when Republic lost 
$111 million in 1983 due to 
unprecedented fare wars and higher 
labor expenses. 
Early last year, below-cost 
pricing occurred in the industry as a 
result of weak traffic, overcapacity, 
and the extreme tactics used to 
attract immediate business. Republic 
faced a difficult dilemma-retain 
passengers by sales promotions that 
would cut revenues, or risk losing 
traffic and more revenues by 
holding fares at current levels. 
Expecting prices to rise, the 
company chose to match fares and 
offer travel incentives to protect its 
markets. While this brought new 
passengers, the decline in total 
revenues produced substantial 
losses. 
Recognizing the urgent need to 
cut operating expenses, the airline's 
employees accepted a 15 percent 
wage reduction and freeze on 
September 1, for a nine-month 
period. As fares returned to 
stronger levels in the third quarter, 
losses were reduced significantly, 
and a modest profit was achieved in 
the fourth quarter. 
For the year 1983, revenues were 
$1. 51 billion and expenses totaled 
$1. 62 billion, resulting in the net 
loss of $111 million, or $4.28 per 
share. For 1982, revenues were 
$1.53 billion, with expenses of 
$1. 57 billion, for a net loss of 
$39. 9 million, or $1. 99 a share. 
The annual results included the sale 
of tax benefits of $13 million in 
1983 and $17. 8 million in 1982. 
Republic flew 9. 7 billion revenue 
passenger miles, a five percent gain 
over 1982. Cargo ton miles, 
continuing to climb rapidly, rose 
22 percent to 79. 7 million. The 
airline carried 17. 8 million 
passengers, off two percent due to 
the discontinuance of certain 
unprofitable routes. 
The company's marketing strategy 
emphasizes the primary hubs- 
Minneapolis/St. Paul, Detroit, 
Memphis and Phoenix. Most new 
flights are targeted to strengthen 
Republic's position at these cities. 
Advertising is directed primarily 
toward business travelers, who 
account for the largest percent of 
airline traffic. During 1983, the 
theme ''Nobody Serves Our 
Republic Like Republic'' was 
dramatized in TV commercials 
featuring actual passengers and 
employees. 
The seventh DC-9 Super 80 jet 
arrived in April 1983. Republic 
purchased another Super 80 
in August and reached agreement 
with McDonnell Douglas 
Corporation to cancel the airline's 
obligations for the six DC-9-80s 
still on order. Pre-delivery deposits 
remaining were applied to the latest 
Super 80 which is being leased to 
McDonnell Douglas for 18 months. 
This transaction, including the net 
sale of tax benefits, produced  
income of $3 million for Republic. 
In March 1984, the company sold 
four DC-9-lOs, with delivery of 
two scheduled for June and two in 
September. The airline currently 
operates 163 jet-powered aircraft. 
To improve its working capital 
position, Republic made a public 
offering of equity securities in 
June 1983. The company received 
$58.3 million in proceeds from the 
sale of 3,740,000 units, each 
consisting of two shares of common 
stock and a warrant to purchase one 
additional common share. Also, 
$8. 5 million in cash wa saved as 
many employees accepted 
alternatives for deferred wages due 
in 1983. 
Republic gratefully acknowledges 
the valuable contribution of Joseph 
E. Rapkin, a director who died in 
May of 1983. This prominent 
Milwaukee attorney and civic leader 
had served the airline since 1965. 
Under the proposed three-year 
Partnership Plan ( described on 
page 2), the company believes that 
a meaningful net profit can be 
earned each year through 1986. 
By adopting the Plan, Republic 
personnel will be making a 
significant commitment to the 
company, and in exchange, will 
share in profits and ownership. 
With the continuing support of its 
stockholders, employees and 
friends, Republic expects to earn a 
profit in 1984 and move toward 
achieving financial stability in the 
future. The airline's unique route 
system offers great potential, and 
management looks ahead confidently 
to better years. 
Sincerely, 
-/)f.w~. 
Hal N. Carr 
Chairman of the Board 
~/~ 
Daniel F. May 
~ 
President and 
Chief Executive Officer 
March 8, 1984 
 IUREU 
ARCATA 
aACRAII 
SAN FRANCISC 
SANJ 
FRE 
LOS ANGELES 
FORT 
GRAND CAYMAN 
K 
WARK 
ILADELPHIA 
EST PALM BEACH 
ORT LAUDERDALE 
OLLYWOOD 
MIAMI 
To our stockholders, employees and friends: 
Republic Airlines and its 
employees are moving toward 
agreement on a three-year 
Partnership Plan which should lead 
to sustained profitability. The 
airline would be more competitive 
with reduced operating costs and 
would have the potential to increase 
revenues. Such a plan became 
mandatory when Republic lost 
$111 million in 1983 due to 
unprecedented fare wars and higher 
labor expenses. 
Early last year, below-cost 
pricing occurred in the industry as a 
result of weak traffic, overcapacity, 
and the extreme tactics used to 
attract immediate business. Republic 
faced a difficult dilemma-retain 
passengers by sales promotions that 
would cut revenues, or risk losing 
traffic and more revenues by 
holding fares at current levels. 
Expecting prices to rise, the 
company chose to match fares and 
offer travel incentives to protect its 
markets. While this brought new 
passengers, the decline in total 
revenues produced substantial 
losses. 
Recognizing the urgent need to 
cut operating expenses, the airline's 
employees accepted a 15 percent 
wage reduction and freeze on- 
September I , for a nine-month 
period. As fares returned to 
stronger levels in the third quarter, 
losses were reduced significantly, 
and a modest profit was achieved in 
the fourth quarter. 
For the year I 983, revenues were 
$1 .51 billion and expenses totaled 
$1.62 billion, resulting in the net 
loss of $111 million, or $4.28 per 
share. For 1982, revenues were 
$1.53 billion, with expenses of 
$1.57 billion, for a net loss of 
$39.9 million, or $1.99 a share. 
The annual results included the sale 
of tax benefits of $13 million in 
1983 and $17.8 million in 1982. 
Republic flew 9.7 billion revenue 
passenger miles, a five percent gain 
over 1982. Cargo ton miles, 
continuing to climb rapidly, rose 
22 percent to 79. 7 million. The 
airline carried 17. 8 million 
passengers, off two percent due to 
the discontinuance of certain 
unprofitable routes. 
The company's marketing strategy 
emphasizes the primary hubs- 
Minneapolis/St. Paul, Detroit, 
Memphis and Phoenix. Most new 
flights are targeted to strengthen 
Republic's position at these cities. 
Advertising is directed primarily 
toward business travelers, who 
account for the largest percent of 
airline traffic. During 1983, the 
theme "Nobody Serves Our 
Republic Like Republic" was 
dramatized in TV commercials 
featuring actual passengers and 
employees. 
The seventh DC-9 Super 80 jet 
arrived in April 1983. Republic 
purchased another Super 80 
in August and reached agreement 
with McDonnell Douglas 
Corporation to cancel the airline's 
obligations for the six DC-9-80s 
still on order. Pre-delivery deposits 
remaining were applied to the latest 
Super 80 which is being leased to 
McDonnell Douglas for 18 months. 
This transaction, including the net 
sale of tax benefits, produced  
income of $3 million for Republic. 
In March 1984, the company sold 
four DC-9-I0s, with delivery of 
two scheduled for June and two in 
September. The airline currently 
operates 163 jet-powered aircraft. 
To improve its working capital 
position, Republic made a public 
offering of equity securities in 
June 1983. The company received 
$58.3 million in proceeds from the 
sale of 3,740,000 units, each 
consisting of two shares of common 
stock and a warrant to purchase one 
additional common share. Also, 
$8.5 million in cash was saved as 
many employees accepted 
alternatives for deferred wages due 
in 1'983. 
Republic gratefully acknowledges 
the valuable contribution of Joseph 
E. Rapkin, a director who died in 
May of 1983. This prominent 
Milwaukee attorney and civic leader 
had served the airline since 1965. 
Under the proposed three-year 
Partnership Plan (described on 
page 2), the company believes that 
a meaningful net profit can be 
earned each year through 1986. 
By adopting the Plan, Republic 
personnel will be making a 
significant commitment to the 
company, and in exchange, will 
share in profits and ownership. 
With the continuing support of its 
stockholders, employees and 
friends, Republic expects to earn a 
profit in 1984 and move toward 
achieving financial stability in the 
future. The airline's unique route 
system offers great potential, and 
management looks ahead confidently 
to better years. 
Sincerely, 
-/)yd/~. 
Hal N. Carr 
Chairman of the Board 
LJ/~ 
Daniel F. May 
~ 
President and 
Chief Executive Officer 
March 8, 1984 
 1983 in review 
Introduction 
In 1983, Republic Airlines 
culminated a five-year period of rapid 
and extensive change since deregulation 
of the industry became law in late 
1978. Southern Airways was merged 
into North Central Airlines in July 
1979, and the company's name changed 
to Republic. Fifteen months later, 
Hughes Airwest (another regional 
carrier) was acquired. An air traffic 
controllers' strike occurred for the first 
time in the industry in August 1981, 
and the Federal Aviation Administration 
imposed severe operating restrictions at 
most major airports. 
Fuel costs rose rapidly during 1979 
and 1980, before peaking in 1981. 
Inflationary forces pushed interest 
charges and labor costs dramatically 
upward. A harsh economic recession 
greatly reduced air travel, and at the 
same time, dozens of new entrants 
began flying. Competition-from both 
established and fledgling airlines- 
intensified. 
Unprecedented fare wars escalated 
and affected virtually every carrier in 
every market during the fourth quarter 
of 1982 and the first two quarters of 
1983. This environment produced the 
most disastrous financial period in the 
history of the air transport industry, as 
a number of major airlines struggled to 
generate cash and to prevent declines in 
market share. 
Consumers, on the other hand, came 
to expect extreme discounts as normal. 
Carriers then faced a difficult 
dilemma-to maintain fares at some 
reasonable level and immediately lose 
passengers to price-cutting competitors, 
or to match fares and create large 
operating losses. 
Republic attempted to hold the line, 
but decreasing load factors and traffic 
levels showed that deep discounts had 
to be matched. Although the company 
was attracting passengers, its yield 
(average revenue per passenger mile 
flown) dropped drastically. Operating 
revenues for the first quarter of 1983 
were below the previous year. Of the 
record 1.05 billion revenue passenger 
miles flown in March, 26 percent came 
from ticket redemptions tied to 
promotions or unprofitable discounts. 
The company then implemented 
strong measures to boost revenues and 
cut costs. A new, mileage-based fare 
2 
Travelers have a wide variety of destination options when 
as many as 25 aircraft converge at Republic hubs during a 
two-hour period. 
structure was adopted. Schedules were 
increased at major hubs, and service 
terminated at cities with limited profit 
potential. Aggressive advertising was 
directed toward business, vacation, and 
convention travelers. 
Mid-year cost cuts 
As 1983 progressed, all large carriers 
began moving to reduce labor costs- 
which represent up to 40 percent of all 
operating expenses. Across the industry, 
agreements were reached to improve 
productivity, reduce base pay, eliminate 
antiquated work rules, and establish 
lower pay and benefit scales for new 
employees. 
Some airlines chose confrontation 
with employees, while others worked 
together to cut costs. Republic was able 
to depend on the support of its 14,200 
workers during these difficult and 
trying times. In July 1983, all 
employees were asked to accept a 15 
percent pay reduction and wage freeze, 
along with more productive work rules, 
for a nine-month period. The program 
became effective September 1, and is 
saving $7 million a month. Employee 
cooperation helped to steadily reduce 
operating expenses, and cost per 
available seat mile declined from 
9.08 cents for the first quarter of 1983 
to 8.24 cents in the fourth quarter. 
Partnership Plan 
In December 1983, the company 
announced a Partnership Plan designed 
to preserve the viability of the airline 
in an era of intense competition from 
established carriers and low-cost 
entrants. 
The Plan is designed to extend the 
present pay cut and wage freeze 
through 1986 and substantially increase 
productivity. These actions would 
enable the company to earn a reasonable 
net profit in each of the next three 
years, based on realistic fares and load 
factors. Provisions of the Plan would 
include employee stock ownership and 
profit-sharing. 
Management is working with the six 
labor organizations that represent 
Republic workers to develop the details 
of the Plan. The agreement would 
increase confidence in the company. 
 Passengers, travel agents, the financial 
community, and the news media will 
know that Republic has made a firm 
commitment to do everything necessary 
to ensure its future. The competition 
will know that Republic can withstand 
market encroachment and fare wars. 
Hub strategy 
By 1983, Republic's multi-hub route 
structure was well developed. It focuses 
on four primary hubs-Minneapolis/ 
St. Paul, Detroit, Memphis and 
Phoenix- strengthened by other traffic 
centers. 
Republic's strategy for growth is to 
bring passengers from medium-sized 
communities to these four major cities. 
Long-haul flights then carry the 
travelers to their business and leisure 
destinations. On some flights, up to 
90 percent of Republic's passengers use 
this "self-feed" system. As many as 
25 aircraft converge on a hub during a 
two-hour period, making dozens of 
travel options available. 
Since 1979, Republic's passenger 
miles and market share have doubled. 
(See Five-year summary on page 24.) 
The number of passengers boarded at 
the four primary hubs has jumped 
72 percent. In 1983, each of the hubs 
Passengers Boarded 
At Republic Hubs 
boarded over one million passengers, 
with Phoenix and Memphis surpassing 
that mark for the first time (see chart). 
Republic now offers 109 flights each 
business day from Minneapolis/St. .Paul, 
92 from Detroit, 84 from Memphis, 
and 63 from Phoenix. 
New flights 
Major new routes were introduced in 
1983 to strengthen Republic's hub 
cities. At Memphis, nonstops were 
added to New York (LaGuardia), 
Tampa/St. Petersburg/Clearwater, 
Gulfport/Biloxi, Mobile/Pascagoula, 
Dallas/Fort Worth and Phoenix. Detroit 
was linked to Philadelphia and 
Washington, D.C. (National). Phoenix 
received new Republic service to 
Portland, Sacramento, San Diego and 
Omaha. At Minneapolis/St. Paul, 
nonstops were inaugurated to St. Louis 
and Columbus (OH). 
Elsewhere on the system, the 
company entered the following markets: 
Atlanta-Houston (Hobby), Omaha- 
Des Moines, Sacramento-Eugene, and 
Las Vegas-Palm Springs/Indio. 
In February 1984, Tulsa became 
Republic's newest city, receiving 
service to Wichita and the Memphis 
hub. Other nonstops linked Detroit to 
Memphis Phoenix Detroit 
79 80 81 82 83 79 80 81 82 83 79 80 81 82 83 
both Miami and Fort Lauderdale/ 
Hollywood; Atlanta to Orlando, 
Memphis, and Milwaukee; Sioux Falls 
to Rapid City; and Des Moines to 
Minneapolis/St. Paul and Phoenix. 
Sky Coach service 
To support the Atlanta connecting 
complex, Republic "Sky Coach" 
service was inaugurated August 15 to 
serve Columbus (GA) and military 
personnel at Fort Benning. Chartered 
buses with the Republic name and 
corporate colors make scheduled trips 
which connect with flights to and from 
the Atlanta airport. This service is 
listed in the Official Airline Guide. 
"Sky Coach" carried 6,620 passengers 
in the first four and a half months. 
Similar service is being extended to 
Anniston/Oxford and nearby Fort 
McClellan on March 1. 
Reallocated resources 
Aircraft and personnel for new flights 
became available when Republic 
discontinued service at 18 points during 
1983 and three in early 1984. Revenues 
and traffic potential at these cities were 
limited. The company worked closely 
with the communities to secure 
adequate, reliable replacement service 
by regional airlines. 
Minneapolis/St. Paul (Million) 
2 
1.5 
1 
.5 
79 80 81 82 83 0 
3 
 Republic presently provides airport 
facilities, counter and gate space, 
training, ticketing or ground service for 
35 regional carriers. The company also 
has joint fares and interline ticketing 
agreements with over 100 regionals. 
Eight are already linked to ESCORT- 
Republic's computerized reservations 
and telecommunications system-and a 
ninth will become a co-host soon. 
By teaming up with these carriers, 
Republic is able to offer passengers 
excellent connecting long-haul service. 
Traffic growth 
Traffic showed modest growth for 
1983, compared with the previous year. 
Passenger miles increased five percent 
to 9. 7 billion, although the number of 
passengers declined two percent to 17.8 
million. This shows the effect of 
discontinuing service to some of the 
smaller cities and reallocating resources 
to long-haul routes. Republic's average 
passenger trip in 1983 was up seven 
percent to 544 miles from 511 (see 
chart). To supplement scheduled 
flights, 307 charter trips served 
40,773 travelers. Cargo ton miles 
jumped 22 percent to 79.7 million. 
Over 192,000 small shipments were 
handled by the company's VIP service 
Average 
Passenger Haul 
(Miles) 
600 
500 
400 
300 
200 
100 
79 80 81 82 83 0 
for "Very Important Packages," a gain 
of eight percent. 
A monthly traffic record was set in 
March when 1,926,246 passengers flew 
Republic. On March 25, a new daily 
high was established with 73,707 
passengers. 
In 1983, significant gains were made 
in "connecting" traffic. Transfers were 
up 156 percent at Phoenix, 31 percent 
in Minneapolis/St. Paul, 30 percent at 
Memphis, and 15 percent at Detroit. 
Cargo, including perishables such asfresh seafood, can be 
swiily transported to Republic cities across the country. 
4 
Reservations and facilities 
The automated check-in system 
introduced by Republic in 1983 has 
expedited procedures for reservations, 
ticket counter check-in, and boarding. 
Each of the l , 900 passenger agents has 
received 16 hours of training on the 
new system. During 1984, additional 
refinements will enable passengers to 
receive seat assignments when making 
reservations up to 60 days in advance. 
A monthly record was set in 
March 1983 when reservations agents 
handled 2.6 million calls. On March 21, 
a single-day high occurred with 
121,225 calls. 
New facilities for Republic 
passengers were completed at New 
York (LaGuardia), Toronto, Detroit, 
Fort Myers, Miami, Columbus (GA)/ 
Fort Benning, Houston (Hobby), 
Memphis, Minneapolis/St. Paul, 
Phoenix, Orange County/Santa Ana/ 
Anaheim, Los Angeles and San Jose 
during 1983. 
New air freight terminals were 
occupied at Montreal, Tampa/ 
St. Petersburg/Clearwater, Milwaukee, 
St. Louis, and Las Vegas. Construction 
is currently underway on passenger or 
freight terminals at Grand Cayman, 
Dallas/Fort Worth, Milwaukee, Green 
Bay/Clintonville, Bismarck/Mandan, 
Tucson, and Sacramento. 
Aircraft transactions 
The seventh McDonnell Douglas 
DC-9 Super 80 joined the Republic 
fleet in April. In March 1984, the 
company sold four DC-9-1 Os, with 
delivery of two scheduled in June and 
two in September. The airline currently 
operates 163 jet-powered aircraft-the 
seventh-largest fleet in the world- 
including 133 DC-9s, 15 Boeing 727s 
and 15 Convair 580s. With the new 
DC-9-80 and greater aircraft utilization 
from improved scheduling, available 
seat miles increased seven percent for 
the year. 
Also, Republic and McDonnell 
Douglas Corporation reached an 
agreement in August 1983 which 
cancelled the company's obligations for 
the six DC-9-80s still on order. The 
remaining pre-delivery deposits were 
applied to the purchase of another 
Super 80, which is being leased to 
McDonnell Douglas for 18 months. 
This transaction, including the net sale 
of tax benefits, produced income of 
$3 million for Republic. 
 Jet fuel 
One of the company's major 
expenses continues to be jet fuel. Over 
one million gallons are used daily. The 
price of fuel decreased nine percent in 
1983 to an average of 88.3 cents per 
gallon. No great changes in supply or 
price are forecast for 1984. 
Average Price 
of Jet Fuel 
(Per Gallon) (Dollars) 
$1.10 
1.00 
.90 
.80 
79 80 81 82 83 .70 
Republic's Flight Crew Training 
Center provides pilots with federally- 
approved simulator training which 
significantly reduces instructional costs. 
The airline has four flight simulators, 
including a new DC-9-80 unit added in 
May 1983-one of just two in this 
country. 
Besides giving instruction to 
Republic pilots, the Training Center 
earns $3 million annually under 30 
contracts with other airlines and the 
federal government for flight crew 
training. 
Fleet maintenance 
Republic's exacting maintenance 
program again kept operating 
performance for 1983 among the 
highest in the industry. The airline 
completed 99. 2 percent of its 
169 million scheduled miles. Only 
three-tenths of one percent of scheduled 
departures were cancelled, and just 
1. 7 percent were delayed for 
maintenance reasons. 
At the company's Power Plant 
Facility, mechanics rebuilt over 300 jet 
engines. Republic performs all major 
maintenance work on its JT8D engines. 
Late in 1983, major aircraft 
maintenance being done at the Phoenix 
base was consolidated and moved to the 
Main Operations Base in Minneapolis/ 
St. Paul. The change resulted from a 
decrease in outside contract work .. 
Inventory savings are expected to total 
$8 million in 1984. 
Skilled mechanics at Republic's Power 
Plant Facility perform all major 
maintenance on the company's JT8D jet 
engines. 
To improve passenger comfort and 
convenience, Republic mechanics are 
completely revamping the interiors of 
the company's DC-9 Series 10 jets. 
Increased leg room and enclosed 
overhead bins for carry-on luggage are 
the main changes. The renovation 
project also includes more attractive, 
contemporary decor. 
5 
 Marketing concepts 
Marketing programs are tied closely 
to the development of Republic's four 
primary hubs- Minneapolis/St. Paul, 
Detroit, Memphis and Phoenix. More 
nonstop flights to key business and 
leisure destinations are being added as 
resources permit. Dominance at these 
important hubs assures continued 
growth and discourages competition 
from other carriers. 
Control of fares is an increasingly 
important task. Passengers have 
become extremely price-conscious, 
since all airlines have used drastic 
discounts to attract or keep business. 
Republic is determined to avoid 
unprofitable fares which cause system- 
wide yield erosion, but is prepared to 
match prices as needed to protect its 
markets. 
Whats Bigger'lhan 
140 CifiesAnd Flies? 
6 
-.,hlicAitlines. 
And~ComingToTulsa. 
Stmting February 1st you'll see something new in 
the air over Tulsa from Republic Airlines. We serve 
more U.S. cities than any other airline. And soon we'll 
be helping you reach them, with new service to and 
from Tulsa. 
Our new nonstops 
bring Wichita and 
Memphis closer, with 6 
quick flights every day. 
From Memphis, we can 
take you to major cities from 
Minneapolis/St. Paul to 
Miami, and 
New York to New Orleans. 
And here's something to make 
the trip a little more interesting. 
tfyou!!J~, 
let us flj you free. , 
Republic's Frequent Flyer 
program is the fastest way 
to get a free round trip of 
any major airline. Faster 
than United, American 
or Delta. And you can 
go to any city we serve. 
Just 20,000 miles does 
it. It's easy to join with 
instant enrollment at 
check-in and even 
easier to get your first 
3,000 miles. 
We'll give them to 
you free if you become a 
Frequent Flyer in February. 
Look for double mileage credit 
on any new flight to Wichita or 
Memphis during February too. 
NEW SERVICE 
FRoMTuLsA 
Thousands who write 
can't be wrong. 
Modesty prevents us from 
telling you how many thousands 
of complimentary letters we get 
every year. The fact is, we're 
Atlanta 
BatonR~e 
Binninghcim 
ChattaMOga 
cf::i 
Detrait 
Huntsville/ 
De.fur 
Knaxville 
Memphis 
Milwaukee 
proud of them. They mean 
we're doing our jobs right. 
They give usa 
reputation to 
live up to. 
Miami 
M~!1:!iir:ul 
New Orleans 
New Yark 
Oiianda 
Philadel,!iia 
Tampa/St. Pete. 
andOY<'l' "Sother c,tiCS 
We like to think all 
the letters say the same 
thing ... Nobody Serves 
Our Republic Like 
Republic. 
For information 
and reservations call a 
travel agent, your 
corporate travel 
planner or Republic: 
800-441-1414. 
~- 
IIBUIUCAIRUIIES 
Nixxiy Serves Our RepubliclikRpuh/ic.' 
Advertisements introducing Republic's arrival in Tulsa stressed the new service 
to Wichita and Memphis, while highlighting dozens of destinations reached 
through the Memphis hub. 
Advertising 
Republic's advertising campaigns are 
primarily targeted at business travelers, 
who account for the largest percent of 
all airline passengers. Continuing the 
theme ''Nobody Serves Our Republic 
Like Republic," the company has 
developed a series of television 
commercials and print advertisements 
based on complimentary letters from 
passengers who write about the good 
service they receive. Authors join the 
personnel involved to reenact the 
situations which inspired the letters. 
The ads spotlight Republic's quality 
service, while displaying the 
friendliness and professionalism of 
employees. 
Business travel 
To attract more business passengers, 
Republic has vigorously promoted its 
Business Coach, Frequent Flyer and 
Executive Suite programs. 
Business Coach, priced at just $15 
over a full coach fare, is an excellent 
value. The traveler enjoys pre-boarding, 
wider seats, and complimentary 
beverages. The quiet, comfortable 
atmosphere helps ensure a productive 
working trip. 
Over 300,000 "Frequent Flyers" are 
now participating in one of the 
industry's best travel bonus programs. 
After every 20,000 miles flown on 
Republic, Frequent Flyers receive a 
free round-trip coach ticket and a 
Business Coach upgrade. 
''FAS TRAC, '' a computerized 
mileage-tracking system, automatically 
credits the mileage to the Frequent 
Flyer's account through the company's 
Business Travel Center. 
Republic's high-mileage Frequent 
Flyer of 1983 logged 325,000 miles of 
travel on the airline and won a $25 ,000 
automobile in a joint promotion 
sponsored by the company and National 
Car Rental System. In 1984, a high- 
mileage Frequent Flyer will be named 
each month. This person will be 
awarded one year's use of a new 
Oldsmobile Cutlass. By the end of 
1984, half-a-million regular passengers 
are expected to be Frequent Flyer 
members. 
Republic " Executive Suites" offer 
convenient airport terminal facilities 
where passengers can relax or conduct 
business in attractive surroundings. 
Some 17,000 travelers paid the $40 
annual fee, or received a year's 
complimentary membership by 
 accumulating 60,000 miles as a 
Frequent Flyer. 
Convention travel activity tripled 
during 1983. Republic was designated 
as the ''Official Airline'' for 600 
conventions and meetings which 
attracted almost one million 
participants. Republic personnel 
coordinate reservations and ticketing 
for delegates, exhibitors, sponsors and 
family members attending these 
gatherings. 
Sales promotion 
Innovative promotions helped 
Republic project its image as a major 
carrier to leisure and vacation 
destinations. Early in 1983, the airline 
teamed with Ralston-Purina using 
millions of Chex cereal boxes to offer 
family discounts on complete vacation 
packages. The ''ABC'' fare emphasized 
Republic's extensive route system and 
encouraged travelers to fly rather than 
drive to nearby hubs. Purchase of a 
Curtis Mathes product entitled buyers 
to special discounts and a sweepstakes 
drawing for free travel. 
"Suntrips with Rainchecks," a 
unique incentive for leisure travelers to 
fly Republic, was launched in 
November to stimulate winter traffic. If 
rain spoiled over half of the 
passenger's vacation in selected cities, 
the company issued another round-trip 
ticket. The program, backed by an 
Members of Republic Executive Suites appreciate the 
comfortq,ble facilities in terminals at seven major cities. 
inexpensive weather insurance policy, 
generated national attention in the news 
media. 
International sales 
Republic's sales efforts extend well 
beyond the 140 cities it serves. A 
strong international marketing team is 
active at another 25 locations. These 
include London, Stockholm, Brussels, 
Munich, Milan, Madrid, Tel Aviv, 
Mexico City, Guadalajara, Caracas, 
Bogota, Lima, Rio de Janeiro, Sao 
Paulo, Buenos Aires, Tokyo, Seoul, 
Taipei, Hong Kong, Manila, Bangkok, 
Kuala Lumpur, Singapore, Jakarta and 
Sydney. In 1983, a European cargo 
sales office was opened in Amsterdam. 
The sales staff has been increased at 
the company's major hubs and other 
important traffic centers to promote 
Republic's quiet, comfortable Business Coach provides an 
excellent atmosphere for a productive working trip or a 
relaxing leisure flight. 
7 
 additional business travel through 
personal contact with large agencies 
and corporate accounts. Republic joined 
the PARS reservations system in 1983 
and is now a co-host in the five 
automated systems used by over 
85 percent of U.S. travel agencies. 
Volunteer activities 
To publicize Republic schedules and 
the cities it serves, volunteers invested 
many hours of their time on sales 
blitzes in 1983. Both active and retired 
employees organized and participated in 
the Community Ambassador Program. 
Over 20,000 calls were made on 
selected travel agencies and commercial 
accounts in 50 cities by the 850 
volunteers. 
On October 8, an estimated 17,000 
employees, family members, friends, 
business and civic leaders, travel agents 
and other invited guests participated in 
a "Rally Round Republic" open house 
at the airline's Main Operations Base in 
Minneapolis/St. Paul. Governor Rudy 
Perpich proclaimed ''Republic Airlines 
Day" in Minnesota, and local news 
media covered the activities 
extensively. Visitors learned about the 
many technical skills and sophisticated 
equipment required to operate a major 
airline. 
The future 
With adoption of a three-year 
Partnership Plan, Republic will have 
the competitive cost structure to 
withstand price-slashing tactics and 
market encroachment by other carriers, 
while bringing financial stability to the 
company. 
Republic has always believed that 
labor and management can reach 
mutually beneficial objectives by 
working together. Employees are one 
of the company's chief assets, and their 
concern and loyalty arc essential in 
today 's highly-competitive, deregulated 
marketplace. 
8 
The airline's schedules, markets and 
route system will focus on supporting 
its four major hubs and strengthening 
other traffic centers. With improved 
service to key business and leisure 
destinations, the company can retain its 
dominant position at these hubs. 
Republic is striving to offer 
passengers the finest type of airline 
service. Convenient schedules, superior 
operating performance, courteous 
attention, excellent food service, and 
prompt baggage delivery support the 
company's slogan, " Nobody Serves 
Our Republic Like Republic." 
Active and retired employees 11 
olunteered to 
make personal sales calls on their own time. 
In 1983, 850 volunteers visited over 20,000 
travel agencies and commercial accounts to 
promote the airline's service. 
With its unique route structure, the 
airline has great traffic potential. In 
addition, its employees are making 
sacrifices to ensure the airline's 
survival, stability and sustained 
success. Republic is determined to 
return to profitability in 1984- and to 
grow financially stronger in future 
years. 
 Management's discussion and analysis 
RESULTS OF OPERATIONS 
1983 compared with 1982 
For 1983, revenues were $1.51 
billion, and operating expenses were 
$1.54 billion, resulting in an operating 
loss of $31 million. Nonoperating 
expenses were $80 million, consisting 
of interest expense of $97. 9 million, 
partially offset by $13 million from the 
sale of tax benefits and $4.9 million 
from other nonoperating items. A net 
loss of $111 million for 1983 was 
incurred. 
During the first six months, Republic 
sustained losses of $102.9 million, due 
to severe fare wars and higher labor 
costs. Conversely, the company's loss 
was held to $8.1 million the second 
half of 1983 because of improving 
yields (average revenue per passenger 
mile) and employee wage concessions 
which began September 1. 
For 1982, revenues were $1.53 
billion, operating expenses totaled 
$1.49 billion, and an operating profit 
of $37 .2 million resulted. Nonoperating 
expenses of $77. 1 million in 1982 
included interest expense of $100.7 
million, offset by gains of $17. 8 
million from the sale of tax benefits 
and $5. 8 million from other 
nonoperating items. The net loss was 
$39.9 million. 
Operating revenues in 1983 fell by 
$19.2 million, or 1.3 percent, 
compared with 1982. Although revenue 
passenger miles increased five percent 
in 1983, yield declined 5.8 percent to 
14.41 cents from 15.29 cents in 1982 
which resulted in a decrease in 
passenger revenues. 
In the fourth quarter of 1982, several 
airlines began offering deeply- 
discounted fares which Republic was 
forced to match. While the availability 
of discount fares increased during the 
first half of 1983, the fares themselves 
did not cover associated costs in many 
cases. To stimulate traffic, the 
company also offered free flights to 
fare-paying passengers in certain 
promotions, and this decreased yield 
levels. For the first six months of 
1983, yield dropped to 12.93 cents 
from 15.38 cents in 1982- a decrease 
of 15. 9 percent, contributing to the 
operating loss of $66.2 million. 
During the second half of 1983, yield 
improved 6.3 percent over 1982 with 
the expiration of most discount and 
promotional fares, and the adoption of 
a mileage-based pricing plan. The 
company expects yield to remain at 
current levels or to improve in 1984, 
unless competitors resort to price- 
cutting tactics. Republic will continue 
to match fares on selected routes when 
required to retain its market share. 
Other revenues were down because 
of a $9. 7 million decrease in public 
service revenues. The change reflects 
withdrawal of service from unprofitable 
subsidized cities and government 
termination of subsidy payments for the 
remaining eligible cities on October 1, 
1983. 
Total Revenues 
- (Billions) 
- 
- $1.5 
...___ 
- 1 
- 
.5 
79 80 81 82 83 0 
Operating expenses increased by 
$49 .1 million in 1983, or 3. 3 percent 
over the previous year. Operating 
expenses per available seat mile 
declined, however, to 8.68 cents in 
1983, from nine cents in 1982, because 
capacity increased by 7 .2 percent 
without a comparable increase in 
expenses. 
Salaries and benefits increased by 
$40.9 million over 1982. This was due 
to a 1. 8 percent growth in the average 
number of employees in 1983 and to 
wage increases which followed the 
temporary 10 percent pay cut and wage 
freeze taken in the first five months of 
,1982. Effective September 1, 1983, 
employees agreed to a 15 percent pay 
cut and wage freeze. This program 
reduced costs by about $28 million in 
1983. 
Although jet fuel consumption 
increased 5 .2 percent, related expenses 
were down $19.4 million because of a 
9 .4 percent drop in fuel prices. 
Average price per gallon was 88.3 
cents in 1983, compared with 97.5 
cents in 1982. 
An $8.8 million increase in the cost 
of maintenance materials and repairs 
occurred in 1983 because of the greater 
number of aircraft engine repairs and 
modifications completed in order to 
increase jet engine fuel efficiency. 
Advertising expense was up $5 million, 
compared with 1982, as Republic 
continued to market the company's 
service aggressively and to build name 
recognition. 
Net interest expense was down $2. 9 
million, largely due to the decreasing 
prime rate. The cancellation of 
Republic's obligation to the McDonnell 
Douglas Corporation for six DC-9-80 
aircraft on order resulted in expenses 
of $1 .4 million, due to the reversal of 
capitalized interest on pre-delivery 
deposits, and $2 million of other 
charges. 
1982 compared with 1981 
For 1982, revenues reached $1.53 
billion, operating expenses were $1.49 
billion, and the company achieved an 
operating profit of $37 .2 million. 
Nonoperating expenses were $77 .1 
million, primarily interest of $100.7 
million, offset by $17. 8 million from 
the sale of tax benefits and $5. 8 million 
from other nonoperating items. This 
resulted in a net loss for 1982 of $39. 9 
million. 
For 1981, the first full year of 
operations since the acquisition of 
Hughes Airwest in October 1980, 
revenues were $1.45 billion, operating 
expenses totaled $1.43 billion, and an 
operating profit of $16.5 million 
resulted. Nonoperating expenses of 
$62.7 million in 1981 included interest 
expense of $108.4 million, offset by 
gains of $28. 9 million from the sale of 
tax benefits and $16.8 million from 
disposition of equipment and other 
nonoperating items. The net loss was 
$46.3 million. 
Operating revenues in 1982 rose by 
$82.3 million, or 5.7 percent, over the 
previous year. Passenger revenues 
increased $90.7 million, cargo was up 
$8.3 million, and public service 
revenues declined by $21 .4 million. 
Higher passenger revenues resulted 
from a 21 percent rise in passenger 
9 
 Operating Revenues 
and Operating Expenses 
(Per A vailahlc Scat Mile) 
Operating 
Revenues 
(Cents) 
10.5c 
l0.0 
9.5 
9.0 
8.5 
1981 1982 
(Quarterly Averages) 
1983 8.0 
miles, and some extra traffic from a 
26-day strike against another carrier. 
Drastic fare discounting, which 
Republic had to match, was the main 
factor causing 1982 's yield to drop 
12 percent to 15.29 cents, from 
17. 3 7 cents in 1981. However, the 
increased passenger miles more than 
offset the poorer yield. Lower public 
service revenues reflect the company's 
withdrawal of service from unprofitable 
subsidized cities. 
Operating expenses were up $61. 5 
million in 1982, or 4.3 percent over 
the previous year. Operating expenses 
per available seat mile declined, 
however, to nine cents in 1982 from 
9 .4 7 cents in 1981. Salaries and 
benefits increased $12.6 million , 
tempered by six-month wage reductions 
for most employees from December 
1981 through the first five months of 
1982. 
Fuel expense rose $3.9 million. 
Higher consumption was offset by a six 
percent drop in aviation fuel prices. 
10 
Travel agency commissions were up 
$25.3 million because a larger 
proportion of revenues were generated 
by travel agents-66.2 percent in 1982; 
compared with 62.5 percent in 
1981-and extra incentives were given 
for special promotional programs. 
Interest expense (before capitalized 
interest) declined by $20.1 million, or 
16.5 percent, from that of 1981. A 
substantial portion of Republic's debt is 
tied to the prime rate, which averaged 
14.8 percent in 1982 and 18.8 percent 
in 1981. 
Inflation and Changing Prices 
For information concerning the 
effects of changing prices and inflation 
on the company's operations, see 
' ' Supplemental Stockholder 
Information'' on Pages 22 and 23. 
LIQUIDITY AND CAPITAL 
RESOURCES 
During 1983 the company had a net 
loss of $111 million and used cash of 
$73.8 million in its operations, 
resulting in a $22.4 million deficit in 
stockholders' equity as of 
December 31 , 1983. The company's 
independent auditors have issued a 
qualified opinion on the 1983 financial 
statements. (See Auditors' Report on 
page 16.) 
The company is currently negotiating 
with representatives of its six employee 
groups to obtain wage concessions and 
productivity improvements under a 
three-year Partnership Plan and is also 
receiving monthly waivers of the 
financial covenants from its major 
banking group. Republic's proposed 
Plan would extend the present 
15 percent pay cut and wage freeze 
through 1986 and substantially increase 
productivity. Provisions of the Plan 
would include employee profit-sharing 
and stock ownership. 
The company's management believes 
that with the wage and other 
concessions from its employee groups, 
the banks will approve long-term 
amendments to the Revolving Credit 
Agreement. The satisfactory resolution 
of these negotiations is necessary for 
the company to achieve successful 
operations. 
Concerning the company's liquidity, 
cash and short-term cash investments 
totaled $59.8 million at December 31 , 
1983, compared with $125.5 million at 
Passenger Yield 
(Cents) 
- - - - 
I I 
1981 
- 
... 
- 
1982 
(Quarterly Averages) 
20C 
IS 
10 
5 
1983 
 December 31, 1982. During the 
1981-83 period, Republic conserved 
cash and supplemented its working 
capital by: 
I. Reduction (f Salaries and Wages. 
Effective September I, 1983, 
employees accepted a 15 percent pay 
cut and wage freeze for a period of 
nine months, which represents a cost 
reduction of $7 million a month. 
Previously, a IO percent pay cut and 
wage freeze were in effect for six 
months through May 1982. 
In 1982, most employees deferred 
one month's salary until August 1983. 
The $24 million deferred pay obligation 
due in August 1983 was reduced by 
$8.5 million when some employees 
accepted $4.6 million in common stock 
or deferred the payment of $3.9 million 
until August 1984. 
In September 1981, most employees 
participated in a "stock for pay" plan 
under which 15 percent of one month's 
wages, or a total of $4.3 million, was 
used to purchase approximately 
709,000 shares at the prevailing market 
price. 
2. Pension Contribution Waivers. In 
December 1983, the Internal Revenue 
Service granted a conditional waiver 
permitting the company to defer $23 
million in 1982 pension contributions. 
The payment must be made over the 
next 15 years, with interest. A similar 
waiver was granted in September 1982 
for the 1981 pension contribution of 
$24 million. 
3. Sale of Tax Benefits. Under terms of 
the Economic Recovery Tax Act of 
1981, Republic received $59. 7 million 
during the past three years through sale 
of tax benefits from new aircraft placed 
in service. Of that amount, $40.8 
million has been applied to the 
purchase price of eight DC-9-80s, and 
$18. 9 million was used to retire debt. 
Such benefits will not be available in 
1984. 
4. Issuance of Common Stock and 
Warrants. Through a Unit offering of 
7,480,000 shares of common stock and 
3,740,000 warrants to purchase 
common stock, the company received 
proceeds of $58.3 million in June 1983. 
5. Issuance of Debentures. In 
December 1982, Republic issued 
I 0-1 /8 percent Convertible Senior 
Subordinated Debentures having a face 
value of $75 million. The company. 
received $71 million, after discounts 
and commissions. 
Prime Interest Rate 
financial covenants of the Revolving 
Credit Agreement include debt-to-equity 
ratios and net worth requirements (as 
defined under the Agreement), a cash 
and short-term cash investments 
minimum, limitations on capital 
expenditures and additional debt, and 
restrictions on the payment of common 
stock dividends. These covenants 
become progressively more restrictive 
over the term of the agreement. 
(Percent) As a result of its losses and the 
...... 
~ 
I_ 
- - 
- 
I 
20 
15 
n 
10 
s 
restrictive nature of the Revolving 
Credit Agreement, the company has 
requested and has received 
modifications from the banking group 
on several occasions in the past. 
Currently, the company is receiving 
monthly waivers of the financial 
convenants. Management believes the 
banks will agree to long-term 
amendments once an acceptable wage 
and productivity agreement is reached 
with the company's employee groups. 
1981 1982 
(Quarterly Averages) 
1983 o In the future, however, Republic may 
Because of the company's present 
financial condition, normal sources of 
external financing may not be available 
at this time. The adequacy of 
Republic's cash resource for 
operations, capital needs and debt 
retirement will, therefore, depend on 
the company's return to profitability. 
This requires continued cost control 
efforts, a high degree of labor 
productivity, and effective revenue 
generation programs. The proposed 
Partnership Plan would provide the 
necessary support for achieving viable 
operations. 
The company is highly leveraged. 
Outstanding debt and obligations under 
capital leases, including current 
maturities, totaled $817 .3 million at 
December 31, 1983. Interest rates float 
with the prime rate on half of this debt. 
At December 31, 1983, Republic had 
borrowed $377 .5 million, the maximum 
available under its Revolving Credit 
Agreement with its major banking 
group. The borrowings are secured by 
liens on most of the company's owned 
aircraft, engines and ground equipment, 
and certain accounts receivable. The 
require additional modifications to the 
covenants if operating results do not 
meet the forecast. 
During 1983, Republic incurred debt 
of $25. 8 million in connection with the 
purchase of two DC-9-80 aircraft. The 
aircraft purchased in August 1983 is 
being leased to McDonnell Douglas 
Corporation for an 18-month period. 
Concurrent with the purchase of this 
aircraft, Republic and McDonnell 
Douglas Corporation reached agreement 
to cancel obligations for the six 
remaining DC-9-80s on order. 
In March 1984, the company reached 
agreement to sell four DC-9-10 
aircraft, with delivery scheduled later 
in 1984. The proceeds from this sale 
will be used primarily to retire debt. 
The company periodically acquires 
computer equipment, ground property 
and equipment, and leasehold 
improvements. The timing and source 
of future capital needs cannot be 
estimated at present. The amount of 
capital expenditures and debt is subject 
to restrictions contained in the 
Revolving Credit Agreement. 
11 
 ~--REPUBLIC AIRLINES, INC. 
Consolidated balance sheets 
(in thousands) 
ASSETS December 31 
1983 1982 
CURRENT ASSETS 
Cash and short-term cash investments ...................... . $ 59,781 $ 125,484 
Accounts receivable-less allowances ....................... . 119,690 120,974 
Flight equipment parts and supplies ........................ . 49,762 49,369 
Prepaid expenses and other ............................... . 33,834 32,813 
263,067 328,640 
PROPERTY AND EQUIPMENT-at cost 
Flight equipment ....................................... . 900,309 835,338 
Ground property and equipment ........................... . 1102003 1012936 
1,010,312 937,274 
Less accumulated depreciation ............................ . 310,194 248,606 
700,118 688,668 
Advance deposits on equipment ........................... . 19,641 
700,118 708,309 
PROPERTY AND EQUIPMENT UNDER CAP IT AL LEASES 
Flight equipment ....................................... . 157,145 157,145 
Ground property and equipment ........................... . 15,937 12,695 
173,082 169,840 
Less accumulated amortization ............................ . 43,370 32,113 
129,712 137,727 1 
; 
DEFERRED CHARGES AND OTHER ASSETS .............. . 15,775 l IA98 
$1!1082672 $1,186,174 
12 
(in thousands) 
LIABILITIES December 31 
CURRENT LIABILITIES 
Current maturities of long-term debt ........................ 
Current obligations under capital leases ...................... 
Accounts payable ........................................ 
Interline payables and tickets outstanding .................... 
Accrued compensation and vacation benefits .................. 
Accrued interest ......................................... 
Accrued pension liability .................................. 
Other accrued expenses ................................... 
LONG-TERM OBLIGATIONS 
Long-term debt-less current maturities ...................... 
Noncurrent obligations under capital leases ................... 
Long-term pension liability and other ....................... 
COMMITMENTS AND CONTINGENCIES (Notes B, C and E) 
REDEEMABLE PREFERRED STOCK OF SUBSIDIARY ...... . 
STOCKHOLDERS' EQUITY (DEFICIT) 
Common stock-authorized 60,000,000 shares of $.20 par value .. 
Additional paid-in capital ................................ . 
Retained earnings (deficit) ................................ . 
1983 1982 
$ 50,079 
7,834 
41,488 
73,478 
57,200 
11,849 
31,826 
21)81 
295,535 
613,941 
145,454 
48,123 
807,518 
28,000 
6,126 
114,630 
(143,137) 
(22,381) 
$1, 1082672 
$ 27,654 
6,465 
53,903 
68,137 
76,178 
19,620 
33,832 
21)03 
306,992 
647,349 
149,938 
25,957 
823,244 
28,000 
4,413 
53,811 
(30,286) 
27,938 
$1,186,174 
The accompanying notes are an integral part of these statements. 
13 
 Consolidated statements of operations 
14 
(in thousands except per share amounts) 
Year ended December 31 
1983 1982 1981 
OPERATING REVENUES 
Passenger. . . . . . . . . . . . . . . . . . . . . . . . . . . ... . . . . . . . . $1,388,285 
Cargo. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76,626 
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,583 
OPERATING EXPENSES 
Salaries and benefits ........................... . 
Aircraft fuel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 
Maintenance materials and repairs . . . . . . . . . . . .... . 
Food service ................................. . 
Rentals and landing fees ....................... . 
Agency commissions .......................... . 
Depreciation and amortization ................... . 
Other ....................................... . 
Operating profit (loss) .................... . 
OTHER EXPENSES (INCOME) 
Interest expense-net of capitalized interest ........ . 
Sale of tax benefits ............................ . 
Gain on disposition of equipment ................ . 
Interest income and other-net ................... . 
Loss before income taxes . . . . . . . . . . . ...... . 
INCOME TAXES .............................. . 
1,511,494 
581,496 
390,937 
58,111 
34,201 
76,863 
102,258 
70,625 
228,020 
1,542,511 
(31,017) 
97,852 
(13,046) 
(923) 
{3,869) 
80,014 
(111,031) 
$1,402,693 
72,914 
55,061 
1,530,668 
540,614 
410,365 
49,353 
33,811 
76,188 
103,546 
68,818 
210,750 
1,493,445 
37,223 
100,703 
(17,752) 
(2,570) 
{3,297) 
77,084 
(39,861) 
$1,311,951 
64,604 
71,861 
1,448,416 
528,004 
406,495 
57,705 
31,252 
68,725 
78,280 
63,728 
197,771 
1,431,960 
16,456 
108,362 
(28,930) 
(13,369) 
{3,396) 
62,667 
(46,211) 
58 
NET LOSS .............................. $ 011,031) $ {39,861) $ {46,269) 
NET LOSS PER COMMON SHARE ....... . ${4.28) $(1.99) ${2.30) 
The accompanying notes are an integral part of these statements. 
 Consolidated statements of changes in financial position 
(in thousands) 
Year ended December 31 
1983 1982 1981 
CASH AND SHORT-TERM CASH INVESTMENTS 
AT BEGINNING OF YEAR ........................... . $125,484 $ 43,542 $ 50,145 
FUNDS USED 
Net loss ....................................... . 111,031 39,861 46,269 
Add ( deduct) non-cash items: 
Depreciation and amortization ................... . (70,625) (68,818) (63,728) 
Other ....................................... . (1,966) (1,544) 652 
Net change in certain working capital items ......... . 35,381 {21,106) {8,376) 
Cash used in (provided from) operations ........ . 73,821 (51,607) (25,183) 
Additions to property and equipment ............... . 59,969 84,291 195,318 
Payment of long-term obligations .................. . 44,985 43,635 62,333 
Payment of cash dividends ........................ . 1,820 4,550 4,436 
Other ......................................... . 8,784 7,451 5,345 
189,379 88,320 242,249 
FUNDS PROVIDED 
Net book value of equipment dispositions ........... . 2,372 14,635 30,423 
Cancellation of advance deposits ................... . 3,428 10,416 
Increase in long-term obligations .................. . 30,887 118,983 144,775 
Increase in notes payable ......................... . 938 25,352 
Deferral of pension payments ..................... . 23,010 24,086 
Issuance of redeemable preferred stock of subsidiary .. . 28,000 
Issuance of common stock and warrants ............ . 62,532 1 4,267 
Options and warrants exercised .................... . 1,159 
Other ......................................... . 1,447 1,203 1,670 
123,676 170)62 235,646 
INCREASE (DECREASE) IN CASH AND 
SHORT-TERM CASH INVESTMENTS ................. . (65,703) 81,942 {6,603) 
CASH AND SHORT-TERM CASH INVESTMENTS 
AT END OF YEAR .................................. . $ 59,781 $125,484 $ 43,542 
CHANGES IN CERTAIN WORKING CAPITAL ITEMS 
Accounts receivable ............................. . $ (1,284) $ (22,744) $ 23,845 
Flight equipment parts and supplies ................ . 393 1,605 4 502 
Prepaid expenses and other . . . . . . . . . . . . . . . . . . . . . . .. 1,021 4,541 (7,458) 
Accounts payable ..................... . ......... . 12,415 2,398 (614) 
Interline payables and tickets outstanding ............ . (5 ,341) 16,250 (14,189) 
Accrued expenses ............................... . 28,177 '{23, 156) {14,462) 
$ 35,381 $ {21,106) $ (8,376) 
The accompanying notes are an integral part of these statements. 
15 
 Consolidated statements of changes in stockholders' equity (deficit) 
Years ended December 31, 1981, 1982 and 1983 
(in thousands) 
Balance at January 1, 1981 ......................... 
Cash dividends: 
Redeemable preferred stock ..................... 
Common stock ................................ 
Issuance of common stock ........................ 
Exercise of stock options and warrants .............. 
Net loss for 1981 ............................... 
Balance at December 31, 1981 ...................... 
Cash dividends on redeemable preferred stock ....... 
Issuance of common stock ........................ 
Net loss for 1982 ............................... 
Balance at December 31, 1982 ...................... 
Cash dividends on redeemable preferred stock ....... 
Issuance of common stock and warrants ............ 
Net loss for 1983 ............................... 
Balance at December 31, 1983 ...................... 
Common Stock 
Shares 
Issued Amount 
20,951 $4,190 
709 142 
401 80 
22,061 4,412 
5 1 
22,066 4,413 
8,564 1,713 
30,630 $6,126 
The accompanying notes are an integral part of these statements. 
Auditors' report 
Alexander Grant 
& COMPANY 
CERTIFIED PUBLIC ACCOUNTANTS 
Stockholders and Board of Directors 
Republic Airlines, Inc. 
Additional Retained 
Paid-In Earnings 
Ca~ital (Deficit) 
$ 48,607 $ 64,830 
(2,336) 
(2,100) 
4,125 
1,079 
{462269) 
53,811 14,125 
(4,550) 
{392861) 
53,811 (30,286) 
(1,820) 
60,819 
011,031) 
$114,630 $ 043, 137) 
MEMBER FIRM 
GRANT THORNTON INTERNATIONAL 
We have examined the consolidated balance sheets of Republic Airlines, Inc. (a Wisconsin corporation) and its subsidiary as of 
December 31, 1983 and 1982, and the consolidated statements ofoperations, changes in stockholders' equity (deficit) and changes 
in financial position for the years ended December 31, 1983, 1982 and 1981. Our examinations were made in accordance with 
generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures 
as we considered necessary in the circumstances. 
The accompanying consolidated financial statements have been prepared on a going concern basis which contemplates the realization 
of assets and the satisfaction of liabilities in the normal course of business. However, as described in Note B, significant uncertainties, 
which include the obtaining of employee wage and other concessions, could cause the company to be unable to continue in business. 
The consolidated financial statements do not include any adjustments relating to the recoverability and classification of a major 
portion of recorded asset amounts or the amount and classification of liabilities that might be necessary should the company be 
unable to continue in the normal course of business. 
In our opinion, subject to the effects on the 1983 consolidated financial statements of such adjustments, if any, as might have been 
required had the outcome of the uncertainties referred to in the preceding paragraph been known, the consolidated financial statements 
referred to above present fairly the financial position of Republic Airlines, Inc., and its subsidiary at December 31, I 983 and 1982, 
and the results of their operations and changes in their financial position for the years ended December 31, 1983, 1982 and 1981 
in conformity with generally accepted accounting principles applied on a consistent basis. 
Minneapolis, Minnesota 
February 3, 1984 
16 
 Notes to financial statements 
December 31, 1983, 1982 and 1981 
Note A - Summary of Significant Accounting Policies 
1. Principles of Consolidation: The consolidated financial 
statements include the accounts of Republic Airlines West, Inc., 
a subsidiary. All significant intercompany transactions have been 
eliminated. Republic Airlines West, Inc. adopted a plan of 
dissolution whereby all of its assets and liabilities will be transfer- 
red to Republic Airlines, Inc. Certain accounts in the 1981 and 
1982 consolidated financial statements have been reclassified to 
conform with the 1983 presentation. 
2. Flight Equipment Parts and Supplies: Spare parts and supplies 
are priced at average cost. An allowance for obsolescence 
($14,101,000 at December 31, 1983 and $9,023,000 at December 
31, 1982) is provided for repairable parts by allocating their cost 
over the life of the related aircraft. 
3. Prepaid Expenses-Engine Overhaul: The company reclassifies 
to a current prepaid expense the estimated portion of the purchase 
price of flight equipment attributable to its overhaul expected to 
be consumed within the next twelve months ($21,720,000 at 
December 31, 1983 and $21,322,000 at December 31, 1982). 
Actual overhaul costs are charged to expense as incurred. 
4. Capitalized Interest: To properly reflect their total cost, major 
additions to flight equipment and ground facilities include 
capitalized interest based on the interest rate of the related debt 
outstanding. The capitalized interest is amortized over the useful 
lives of the related assets for both financial reporting and income 
tax reporting purposes. In 1983, capitalized interest of $1,428,000 
was reversed due to the cancellation of aircraft orders, resulting 
in a net charge of $801,000. Capitalized interest was $1,342,000 
in 1982 and $13,819,000 in 1981. 
5. Property, Equipment and Depreciation: Owned property and 
equipment are stated at cost. Property and equipment acquired 
under capital leases are stated at the lower of the present value 
of minimum lease payments or fair market value at the inception 
of the lease. Depreciation and amortization of property and equip- 
ment are provided on a straight line basis over estimated useful 
lives of 7-20 years for flight equipment and 3-10 years for other 
property and equipment. 
6. Deferred Charges: Significant costs, such as personnel train- 
ing relating to the introduction of new types of aircraft, are 
deferred and amortized over periods of up to five years. Expenses 
incurred in connection with the issuance of long-term obligations 
are amortized on a straight line basis over the terms of the related 
obligation . 
7. Passenger Revenues: Passenger revenue is recognized when 
the transportation service is provided. Tickets sold but unused 
are classified as a current I iabil ity. 
8. Pension Costs: The company has pension plans covering all 
employee groups, and funds its current expense of normal costs. 
Prior service costs are amortized over varying periods up to 40 
years. Pension funding is determined under the unit credit, 
aggregate frozen liability, and individual entry age normal 
methods. 
9. Income Taxes: The company uses the flow-through method 
of accounting for investment tax credit which reduces income 
tax expense when the related liability is reduced. Investment 
credits not applied currently are offset against deferred income 
taxes to the extent they are applicable to previously deferred taxes 
becoming payabie in the carryover periods. The company 
recognizes deferred income taxes resulting from differences in 
financial and income tax reporting. 
Note B - Uncertainties Affecting Going Concern - The con- 
solidated financial statements of the company have been prepared 
on a going concern basis, which contemplates the realization of 
assets and satisfaction of liabilities in the normal course of 
business. Accordingly, the consolidated financial statements do 
not include any adjustments relating to the recoverability and 
classification of a major portion of recorded asset amounts or 
the amount and classification of liabilities that might be necessary 
should the company be unable to continue in the normal course 
of business. 
During the year ended December 31, 1983 the company incurred 
a net loss of $111,031,000 and used cash of $73,821,000 in its 
operations. In addition, at December 31, 1983, the company has 
a deficit in stockholders' equity of $22,381,000. The company's 
financial condition, operating results and inability to meet its 
existing debt covenants without amendments to its loan agree- 
ments (Note D(a)) may result in the company being unable to 
continue in business. 
The company's continuation as a going concern is principally 
dependent on its ability to: 
(a) Successfully conclude negotiations with representatives 
of its employee groups to obtain wage and other conces- 
sions on a long-term basis. 
(b) Continue to reach agreement with the participants to the 
Revolving Credit Agreement which will satisfactorily 
modify certain restrictive covenants. 
(c) Ultimately attain successful operations. 
The company is currently negotiating with representatives of 
its six employee groups to obtain wage and other concessions, 
and has been receiving monthly waivers of its loan agreement 
financial covenants. Management believes that, with the employee 
wage and other concessions, the company will be able to reach 
agreement on long-term amendments to the Revolving Credit 
Agreement and to have successful operations which should, in 
turn, enable the company to continue in the normal course of 
business. Without the employee wage and other concessions, 
management believes that the company may be unable to con- 
tinue in the normal course of business. 
Note C - Sale of Tax Benefits - The leasing provisions of the 
Economic Recovery Tax Act of 1981 aJlowed the company to 
enter into sale-leaseback transactions for income tax purposes 
involving certain equipment additions. As a result of these 
transactions, the company has recognized nonoperating income 
(net of related expenses) of $13,046,000 in 1983, $17,752,000 
in 1982 and $28,930,000 in 1981. Provisions of these transactions 
include, among other things, indemnification of the buyer against 
loss of the stipulated tax benefit amount. The company does not 
expect to be able to sell tax benefits in the future. 
17 
 Notes to financial statements 
December 31, 1983, 1982 and 1981 (continued) 
Note D - Long-term Debt - Substantially all flight equipment, 
spare parts and ground property owned by the company and 
certain accounts receivable ($42,684,000 at December 31, 1983) 
are pledged as collateral against the long-term debt, consisting 
of the following at December 31 (in thousands): 
1983 1982 
Revolving Credit Agreement (a) ......... $377,455 $395,455 
Installment notes (b) .................. 157,607 145,540 
Equipment Trust Certificates (c): 
due May 1, 1993 ................. .. 29,850 33,000 
due July 1, 1998 ................. ... 7,784 8,303 
Subordinated debentures (d): 
13 % due November 15, 1993 ......... 14,260 14,500 
10-1/8% due December 15, 2007 
(net of unamortized discount of 
$1,797,000 and $1,875,000) ........ 73,703 73,125 
Sundry ................ .... ......... . 3,861 5,080 
Total long-term debt ..... .. ...... .... 664,020 675,003 
Less current maturities (e) ..... ..... .. 50,079 27,654 
$613,941 $647,349 
(a) During July 1983, the company prepaid the October 1, 1983 
and January 1, 1984 installments of $9,000,000 each. The balance 
at December 31, 1983 (the maximum available) will be retired 
in quarterly installments aggregating $27,000,000 in 1984, 
$36,000,000 in 1985, $46,000,000 in 1986, $56,000,000 in 1987, 
$60,000,000 in 1988, 1989, and 1990 and final payments of 
$32,455,000 in 1991. The company is also required to prepay 
indebtedness under the Revolving Credit Agreement to the ex- 
tent cash and short-term cash investments exceed certain balances, 
to the extent the company achieves profits in excess of specified 
amounts, and from net proceeds from the disposition of certain 
flight equipment. Interest is paid monthly to each participating 
bank at  % over the Citibank, N .A. alternative rate or other 
rate as negotiated with individual bank participants. The effec- 
tive rate at December 31, 1983 was 11  % . 
Among the original loan covenants in the Revolving Credit Agree- 
ment are requirements for the maintenance of debt to equity ratios, 
restrictions on dividend payments and capital expenditures. As 
a result of continuing losses in 1981, 1982 and 1983, these 
covenants were amended to permit the company to remain in 
compliance. The revised covenants, which include minimum 
stockholders' equity and minimum cash and short-term cash 
investments provisions, are effective through the remaining term 
of the Revolving Credit Agreement. At the current time, however, 
the company has obtained a waiver of certain covenants through 
March 31, 1984, but management estimates that the company 
may be unable to remain in compliance with current minimum 
stockholders' equity and minimum cash and short-term cash 
investments provisions during 1984. It will be necessary for the 
company to obtain further modifications from its lenders which 
it expects to obtain upon the successful negotiation of conces- 
sions with its employee groups. 
The company is required to maintain average compensating 
balances of 10 % of the monthly aver.age loan outstanding and 
to pay interest on any compensating balance shortfall at  % over 
the Citibank, N.A. alternative rate. During 1983 the company 
was required to maintain average compensating balances (adjusted 
18 
for float) of $40,077,000. At December 31, 1983, the required 
compensating balances (adjusted for float) were approximately 
$39,108,000. 
(b) Consists of various installment notes with final maturity dates 
from 1985 through 1998 at interest rates ranging from 8 % (for 
notes guaranteed by the Federal Aviation Administration) to 19 % . 
The aggregate installment payments in 1984 will be approximately 
$39,292,000 including interest. 
( c) The Equipment Trust Certificates due May 1, 1993 require 
semi-annual sinking fund payments of $1,575,000 from 1984 
through 1992 and $1,500,000 at maturity plus interest at 9%. 
The company may make semi-annual optional sinking fund 
payments up to $1,575,000 and may pay off the remaining balance 
in full on or after May 1, 1988 at a premium. 
The Equipment Trust Certificates due July 1, 1998 require semi- 
annual sinking fund payments of approximately $259,000 plus 
interest at rates ranging from  to 1  % over the Citibank, N .A. 
alternative rate. The effective rate at December 31, 1983 was 
11 V2 % . The company may pay off the remaining balance in full 
at any time without a premium. 
( d) On October 1, 1980, the company issued $14,500,000 of 13 % 
convertible subordinated debentures due November 15, 1993 as 
partial payment for the acquisition of the stock of Hughes Airwest. 
Interest payments are due semi-annually. The debenture holder 
may convert the principal to common stock of the company at 
$12.17 per share (1,171,734 shares at December 31, 1983), sub- 
ject to adjustment. The debentures are redeemable at a premium 
beginning on November 16, 1985. Annual sinking fund payments 
are $950,000 in each of 1984 and 1985, $1,220,000 in 1986, 
$1,490,000 in 1987, $1,600,000 in each of 1988 through 1992 
and $1,650,000 in 1993. 
In December 1982 the company issued $75,000,000 of 10-1/8% 
convertible senior subordinated debentures at 97 V2 % of face 
value. The debentures, due December 15, 2007, are superior in 
right of payment to the company's 13 % con~ertible subordinated 
debentures. Interest payments are due semi-annually and deben- 
ture holders may convert the principal to common stock of the 
company at $10.00 per share (7,500,000 shares at December 31, 
1983). Debentures are redeemable by the company at a premium 
through December 15, 1992, and at face value thereafter, except 
certain conditions must be met if redemption is to occur prior 
to December 15, 1984. Sinking fund payments of $3,750,000 
are due annually beginning December 15, 1992, and continuing 
through December 15, 2006, with the balance due at maturity. 
(e) Current maturities of all long-term debt due in each of the 
next five years following December 31, 1983 are as follows (in 
thousands): 
1984 .......................... .. ....... $50,079 
1985 ..................... . ...... . ....... 59,222 
1986 ................................ . ... 65,802 
1987 ....................... . ............ 72, [93 
1988 .................................... 77, l08 
 Note E - Leases - The company has lease commitments for flight 
equipment, various airport facilities, its main operating facilities, 
its maintenance and training facilities, and other property and 
equipment. The lease commitments for airport facilities are based 
upon usage and landings and are subject to adjustment depending 
upon the needs of each airport operating authority and, therefore, 
certain amounts of the commitments are not determinable. 
The company has capital lease agreements for 19 aircraft. The 
debt obligations relating to the capitalization of these leases were 
$140,918,000 at December 31, 1983. The aggregate payments 
in 1984 will be approximately $19,509,000 including interest at 
rates ranging from 8  % to 14 1 
/2 
% . 
In addition, the company has various types of ground property 
and equipment under capital lease agreements. The debt obliga- 
tions relating to the capitalization of these leases were 
$12,370,000 at December 31 , 1983. The aggregate payments in 
1984 will be approximately $3,557,000 including interest at a 
weighted average rate of 14 % . 
At December 31, 1983, future minimum rental payments under 
capital leases and noncancellable operating leases with initial or 
remaining terms of more than one year are as follows (in 
thousands): 
1984 .................. . ....... . .... . 
1985 .. . .. . ........... . ............. . 
1986 ............. . ........... .. . . .. . 
1987 ...... .. ... . ..... . . . .......... . . 
1988 . . .......... ..... ..... . .... . . .. . 
Thereafter .... . .... . .. . . . . .... .... .. . 
Total minimum lease payments .. .. . .. . 
Les amounts representing interest . . .. .. . 
Present value of future minimum capital 
lease payments . .. . .... . ... . .. . .... . 
Operating 
Leases 
$ 31 ,146 
30,558 
30,137 
26,710 
25,088 
327,031 
$470,670 
Capital 
Leases 
$ 23,066 
22,896 
22,253 
19,237 
19,056 
174,050 
280,558 
127,270 
$153,288 
Note F - Income Taxes -Income tax expense for the years ended 
December 31, is as follows (in thousands): 
Current income taxes (credit) 
Federal .. . ......... . .... . .. . . . ... . . $ 
Investment tax credit . .. .. .......... . 
State and local . . . . .. . . .. ..... . . . .. . . 
Deferred income taxes (credit) 
Federal .. .. ... . .. .. . . ... . . . .. ..... . 
Investment tax credit ... .. ...... . . . . . 
State and local . . ........ . .... . . . ... . 
1983 1982 1981 
$ $1 ,206 
567 
1,773 
_i!.!Q) 
1,663 
(2,978) 
1,683 
(1 ,295) 
- _Qj_Q) 
- (1 ,605) 
$ - $ 58 
Differences between income tax expense and amounts derived 
by applying the statutory federal income tax rate of 46 % to income 
before income taxes are as follows (in thousands): 
1983 1982 1981 
Income tax expense (credit) 
at statutory federal 
income tax rates .... .  . .. ......... $(51,074) $(18,336) $(21,257) 
Investment tax credit ...... . ... . . . .. 2,250 
Employee Stock Ownership Plan .. . .. 88 2,346 
State and local taxes net of federal 
income tax benefit .. .. .. . . . .. . . .. (420) 
Non-taxable permanent differences ... . 797 1,471 2,619 
Tax effect of net operating loss 
carryforward not recognized .... ... 50,268 16,732 13,211 
Other ..... .. . .... .......... . ... .. 9 45 _L1Q2 
$ - $ 58 
--- 
Deferred income taxes arise from timing differences between 
financial and tax reporting. The tax effects of these differences 
are as follows (in thousands): 
Capitalized interest . .. . . . . ........ . . 
Investment tax credit . ... . .. . ... . .. . 
Training and development .... .. .. . . . 
Depreciation .. . . . . . .. . . . .. ... ... . . 
Other . . .. ..... . . ...... . .. . .... .. . 
1983 
$ - $ 
1982 
$ _$ __ 
1981 
$ (2,372) 
1,683 
(316) 
(843) 
243 
$ (1,605) 
For Federal income tax reporting purposes, the company and its 
subsidiary file separate tax returns. Republic Airlines, Inc. has, 
as of December 31, 1983, a net operating loss carryover of 
approximately $202,023,000 available to offset future taxable 
income. Approximately $37,216,000 expires in 1995, 
$29,665,000 in 1996, $22,081,000 in 1997 and $113,061,000 
in 1998. Investment tax credits of $40,527,000 are available to 
offset future income taxes payable and expire as follows: 
$10,928,000 in 1994; $17,120,000 in 1995; $6,035,000 in 1996; 
$4,098,000 in 1997; and $2,346,000 in 1998. 
Republic Airlines West, Inc. has, as of December 31 , 1983, a 
net operating loss carryover of approximately $79,814,000 
available to offset future taxable income. Approximately 
$38,050,000 expires in 1994, $23,674,000 in 1995 and 
$18,090,000 in 1996. Investment tax credits of $7,707,000 are 
available to offset future income taxes payable and expire as 
follows: $896,000 in 1993; $4,482,000 in 1994; $402,000 in 
1995; $1,724,000 in 1996; and $203 000 in 1997. 
For financial reporting purposes, the company and its subsidiary 
calculate income taxes on a consolidated basis. On this basis, there 
are approximately $185,000,000 of net operating loss carryovers 
available to offset future consolidated taxable income and con- 
solidated investment tax credit carryovers of approximately 
$42,000,000 are available to offset future consolidated tax 
provisions. Any utilization of the pre-acquisition net operating 
losses or investment credits of Republic Airlines West, Inc. will 
be recorded as adjustments of the purcha e transaction. 
19 
 Notes to financial statements 
December Jl, 1983, 1982 and 1981 (continued) 
The Internal Revenue Service has examined and cleared the com- 
pany's federal tax returns through December 31, 1976. Federal 
income tax returns of the company through December 31, 1979 
are currently being examined. Several adjustments have been 
proposed, mainly dealing with the timing of tax deductions, and 
provision has been made for adjustments which may result. 
Note G - Retirement Plans -The company has retirement plans 
covering all employee groups. Pension expense for 1983, 1982, 
and 1981 was $36,784,000, $35,865,000 and $35,842,000, 
respectively. The company has either made contributions to the 
plans equal to the amounts accrued for pension expense or has 
obtained minimum funding waivers from the Internal Revenue 
Service. In December 1983 and September 1982, the company 
received permission from the Internal Revenue Service to fund 
$23,010,000 of the 1982 pension costs and $24,086,000 of the 
1981 pension costs over a period of not more than fifteen years. 
The current portion of the long-term pension liability due in 1984 
is $5,335,000 including interest. 
Changes during 1982 in the actuarial assumptions used in com- 
puting pension costs had the effect of reducing the 1982 net loss 
by approximately $2,980,000 or $.14 per share. Also in 1982, 
plan improvements and early retirement pension benefits had 
the effect of increasing the present value of plan benefits 
approximately $44,665,000 and increasing the 1982 net loss 
approximately $3,705,000 or $.17 per share. Plan improvements 
during 1981 had the effect of increasing the present value of plan 
benefits approximately $16,253,000 and increasing the 1981 loss 
approximately $910,000 or $.04 per share. The accumulated plan 
benefits and plan net assets for the company's defined benefit 
plans are as follows (in thousands): 
Actuarial present value of 
accumulated plan benefits 
Vested . . . ... . .... . .. . ..... . .... .. . . .... . 
Nonvested .. .. . .... . .. . ... . .. . .. . ... . .. . . 
Net assets available for benefits . ... ... . . . . . .. . 
January 1 
1983 1982 
$321,151 
33,065 
$354,216 
- - - 
$291,697 
- - - 
$284,865 
30,609 
~ 
$233,463 
The weighted average assumed rate of return used in determining 
the above actuarial present value of accumulated plan benefits 
was 7  % for both 1983 and 1982. 
Note H - Warrants and Options - During the second quarter 
of 1983, the company issued 3,740,000 warrants in connection 
with a unit offering of common stock and warrants. The war- 
rants, all of which were outstanding at December 31, 1983, enable 
the holders to purchase common stock at $10.00 per share through 
May 15, 1986. 
20 
In 1982 the company granted 155,500 warrants to certain lenders 
in consideration of the debt restructuring of the Revolving Credit 
Agreement and the 13 % convertible subordinated debentures due 
November 15, 1993. The warrants enable the holders to purchase 
common stock at $8.00 per share through August 26, 1990. 
On September 1, 1983, an officer of the company was granted 
an option to purchase 25,000 shares of common stock at $4.25 
per share. The option terminates on August 31, 1988. At 
December 31, 1983, the entire option was outstanding. 
Note I - Net Loss Per Share - Primary loss per share for 1983, 
1982 and 1981 was based on the weighted average number of 
common shares outstanding of 26,720,591, 22,026,966 and 
21,385,451, respectively. The net loss was increased by preferred 
dividend requirements of $3,337,000 in 1983, $3,943,000 in 1982 
and $2,942,000 in 1981 prior to computing the per common share 
amount. Fully diluted loss per share is not presented because it 
is anti-dilutive. 
Note J - Preferred Stock and Redeemable Preferred Stock 
of Subsidiary - The company has authorized but unissued 
25,000,000 shares of $.01 par value Preferred Stock. 
The company's subsidiary, Republic Airlines West, Inc. , has 
authorized 500,000 shares of $100 par value Cumulative Pre- 
ferred Stock. In February 1981, the subsidiary issued 280,000 
shares in a private placement with McDonnell Douglas Corpora- 
tion in connection with aircraft acquisition and financing trans- 
actions. Cumulative dividends are payable quarterly at an annual 
rate of $13.00 per share through April 1985, $16.00 per share 
from May 1985 to January 1990, $18.00 per share from February 
1990 to January 1993, and $20. 00 per share thereafter. The shares 
are callable at any time, at $ 100 per share plus all unpaid 
dividends. The liquidation preference is $100 per share plus 
unpaid dividends before any distribution to Republic Airlines, 
Inc. Quarterly sinking fund redemption, consisting of 2  % of 
the outstanding shares at a price of $100 per share plus dividends 
unpaid to the redemption date, begins on April 30, 1987, and 
is calculated to retire all preferred shares by April 30, 1997. In 
case of default, including failure to pay dividends, the shareholder 
can require the company to purchase all or any portion outstanding 
at $100 per share plus all unpaid dividends. In addition, the 
shareholder could have required the company to purchase 9,000 
shares in 1983, but waived its right to redeem these shares. The 
shareholder can require the company to purchase 55,200 shares 
in 1984, 46,200 shares in 1985, 59,000 shares in 1986, 72,000 
shares in 1987, and 47,600 shares in I 988. With the approval 
of McDonnell Douglas Corporation, the October 1983 dividend 
of $910,000 was declared and paid in January 1984. 
 Supplemental stockholder information 
FORM 10-K REPORT 
For the Form 10-K report to the Securities and Exchange Com- 
mission, write Mr. A. L. Maxson, Senior Vice President-Finance, 
Republic Airlines, Inc., 7500 Airline Drive, Minneapolis, MN 
55450. 
LABOR AGREEMENTS 
Among the agreements the airline has with six labor unions, one 
is currently under negotiation and five are amendable in 1985. 
The company has also proposed a three-year Partnership Plan 
to these unions to obtain wage concessions and productivity 
improvements. The company expects to reach equitable agree- 
ments with these unions. 
COMMON STOCK INFORMATION 
The following tabulation sets forth the price range for the 
company's common stock which is traded on the New York Stock 
Exchange and the Midwest Stock Exchange. 
1983 1982 
~ Low ~ Low 
1st Quarter ... ........ $10-1/8 $7-1/2 $4-3/8 $2-7/8 
2nd Quarter . . . ........ 9-3/8 6-3/4 4-3/4 3-1/8 
3rd Quarter .. ........ . 7-7/8 3-3/4 6-1/2 4-3/8 
4th Quarter ........... 5-1 /8 3-1/2 9-1/2 4-5/8 
The company did not pay any cash dividends on common stock 
in 1983 or 1982, but paid a cash dividend on common stock of 
$ .10 per share to its stockholders during the first quarter of 1981. 
The terms of the Revolving Credit Agreement dated October 1, 
1980, as presently amended, restrict payment of dividends on 
or the repurchase of common stock until certain financial loan 
covenants are met. At February 29, 1984, the company had 
37,649 holders of common stock. 
QUARTERLY SUMMARIES OF OPERATIONS 
(unaudited-in thousands except per share amounts) 
1983 
Three Months Ended 
December 31 * Se~tember 30 
Operating Revenues . ......... ' 
...... $386,381 
Operating Expenses ................. 359,052 
Operating Profit (Loss) .............. 27,329 
Net Earnings (Loss) ................. 4,037 
Net Earnings (Loss) Per Common Share 
Primary .................... .10 
Fully Diluted ............... .10 
* Year-end adjustments resulting from changes in estimates of various 
benefit accruals increased net earning~ by approximately $6.100.000. 
$392,959 
385,082 
7,877 
(12,161) 
(.44) 
(.44) 
June 30 
$374,246 
401,747 
(27,501) 
(43,925) 
(1.83) 
( l. 83) 
ANNUAL MEETING 
Wednesday, April 25, 1984 
REGISTRARS AND TRANSFER AGENTS 
Norwest Trust Company 
New York, New York 10005 
N orwest Bank Minneapolis, N. A. 
Minneapolis, Minnesota 55480 
SECURITIES LISTED 
Common Stock (RAI) 
New York Stock Exchange 
Midwest Stock Exchange 
Warrants (RAIW) 
New York Stock Exchange 
Convertible Senior Subordinated Debentures- 
10-1 /8 % (RAIK) 
New York Stock Exchange 
Trustee: 
Norwest Bank Minneapolis, N.A. 
Minneapolis, Minnesota 55480 
AUDITORS 
Alexander Grant & Company 
1982 
Three Months Ended 
March 31 December 31 Se~tember 30 June 30 
$357,908 $348,579 $397,172 $412,193 
396,630 378,860 378,970 367,945 
(38,722) (30,281) 18,202 44,248 
(58,982) (27,324) (5,824) 15,839 
(2.70) (1.29) (.3 l) .68 
(2.70) (1.29) (.31) .67 
March 31 
$372,724 
367,670 
5,054 
(22,552) 
(1.06) 
(1.06) 
21 
 Supplemental stockholder information 
(continued) 
EFFECTS OF CHANGING PRICES (unaudited) 
Basis of preparation of 1983 supplemental data 
As required by Financial Accounting Standards Board (FASB) 
Statement No. 33, "Financial Reporting and Changing Prices," 
the company has provided supplemental information concerning 
the effects of changing prices on its financial statements. The 
disclosures are intended to address two different aspects of an 
inflationary environment: (1) the effect of a rise in the general 
price level on the exchange value or purchasing power of the 
dollar (called "general inflation") and (2) the specific price 
changes in the individual resources used by the company. 
The supplemental information on changing prices does not reflect 
a comprehensive application of either type of inflation accoun- 
ting. During the experimental period, the FASB decided to focus 
on those items most affected by changing prices, that is: (1) the 
effect of both general inflation and specific price changes on in- 
ventories and property and equipment and the related impact on 
earnings or loss, and (2) the effect of general inflation on monetary 
assets and liabilities. 
Loss from operations 
The net loss as reported in the primary statements represents the 
amount reported on the historical cost basis of accounting. Net 
loss adjusted for general inflation represents the historical amounts 
ofrevenues and expenses stated in dollars of the same (constant) 
general purchasing power, as measured by the average level of 
the Consumer Price Index (CPI) for 1983. Under this measure- 
ment method, historical amounts of depreciation expense, gain 
on equipment dispositions, and spare parts inventory are adjusted 
to reflect the change in the level of the CPI since the date the 
properties were acquired. 
Current cost accounting attempts to deal with a different issue 
than earnings or loss adjusted for general inflation. The specific 
prices of the company's goods and services have risen at a dif- 
ferent rate than the general inflation rate as measured by the CPI. 
The net loss adjusted for changes in specific prices (current cost) 
measures spare parts inventory, property and equipment, and gain 
from disposition of equipment at current cost (rather than 
historical cost) at the balance sheet date. 
Income taxes 
Present tax laws do not allow deductions for higher depreciation 
adjustments for the effects of inflation. Thus, taxes are leviea 
on the company at rates which, in real terms, exceed established 
statutory rates. During periods of persistent inflation and rap- 
idly increasing prices, such a tax policy effectively results in a 
tax on shareholders' investment in the company. 
22 
Purchasing power gain from holding net monetary liabilities 
during the year 
When prices are increasing, the holding of monetary assets (e.g., 
cash and receivables) results in a loss of general purchasing 
power. Similarly, liabilities are associated with a gain of general 
purchasing power because the amount of money required to set- 
tle the liabilities represents dollars of diminished purchasing 
power. The net gain in purchasing power is shown separately 
in the accompanying supplemental data. The amount has been 
calculated based on the company's average net monetary liabilities 
for the year multiplied by the change in the CPI for the year. 
Such amount does not represent funds available for distribution 
to shareholders. 
Current cost measurements 
Current cost calculations involve a substantial number of 
judgments as well as use of various estimating techniques that 
have been employed to limit the cost of accumulating the data. 
The data reported should not be thought of as precise 
measurements of the assets and expenses involved, but as 
reasonable approximations of the price changes that have occurred 
in the business environment in which the company operates. 
Current cost asset amounts were derived principally through a 
reference guide to current selling prices supplied by the Air 
Transport Association. Current cost depreciation is based on the 
average current cost of property and equipment during the year. 
Depreciation expense was computed by applying the ratio of 
historical depreciation expense to average historical asset cost 
to the average current cost of these assets. The result should be 
approximately the same as would be calculated using the deprecia- 
tion methods used in preparing the primary financial statements. 
Current cost does not purport to represent the amount at which 
the assets could be sold. 
Increases in current cost adjusted for general inflation 
Under current cost accounting, increases in specific prices (cur- 
rent cost) of spare parts inventory and property and equipment 
held during the year are not included in the loss from operations 
but are presented separately. The current cost increase is reduced 
by the effect of general inflation measured by applying the annual 
rate of change in the CPI to the average current cost balance of 
spare parts inventory and property and equipment. 
Five-year comparison of selected financial data 
As described above, the determination of net assets reflects a 
partial application of the two inflation accounting methods. Other 
assets, consisting primarily of deferred charges, have not been 
adjusted for general inflation or specific price changes. In 
addition, noncurrent payables have not been converted to reflect 
specific price changes (e.g., changes in interest rates). 
 CONSOLIDATED STATEMENT OF OPERATIONS 
-ADJUSTED FOR CHANGING PRICES 
Year ended December 3 I , 1983 (in thousands-unaudited) 
Total operating revenues ........ . ....... .  ... . .  ...... .................. ... . . 
Depreciation and amortization expense . ....... . ..... . .......... . .... . ....... . 
Other operating expenses ..... .. .. . .... .................. . ................. . 
Gain on disposition of equipment ... ... ........ . . ... . ............... . 
Other expenses- net ........ . .. . ...... . ........................ .. . 
Net loss . .. .... .. . 
Gain from decline in purchasing power of net amounts owed ..... .. .... . 
Increase in specific prices (current cost) of inventory and property 
and equipment held during the year* ............... . 
Effect of increase in general price level ........................... . ..... . ... . 
Excess of increase in specific prices over increase in the general price level ....... . 
* At December 31, 1983, current cost of inventory was $53,706,000, 
and the current cost of property and equipment, net of accumulated 
depreciation and amortization, was $ 1,940,059,000. 
As Reported 
in the 
Primary Statements 
$1,511,494 
70,625 
1,47 I ,886 
(923) 
80,937 
1,622,525 
$ (111 ,031) 
Adjusted for 
General 
Inflation 
$1,511,494 
99,985 
1,473,193 
(437) 
80,937 
1,653,678 
$ (142,184) 
$ 33,655 
FIVE-YEAR COMPARISON OF SELECTED SUPPLEMENTARY FINANCIAL DATA 
-ADJUSTED FOR EFFECTS OF CHANGING PRICES 
(In average 1983 constant dollars, in thousands except per share and price index amounts-unaudited) 
Adjusted for Changes 
in Specific Prices 
(Current Cost) 
$1,511,494 
162,689 
1,473 ,193 
(946) 
80,937 
1,715 ,873 
$ (204,379) 
$ 33,655 
$ 136,431 
60,006 
$ 76,425 
Year Ended December 31 
1983 1982 1981 1980 1979 
Total operating revenues-at historical costs . ...... .. . ....... ........... . . $1,51 1,494 $1,530,668 $1,448,416 $ 916,715 $609,230 
Total operating revenues-in average 1983 dollars ... ...... .... ...... . .. . $1,511,494 $1,579,908 $1,586,664 $1,108,378 $836,220 
Historical cost information-adjusted for general inflation 
Net lo s from operations .......................................... . $ (142,184) $ (78,550) $ (75,424) $ (48,990) $ (235) 
Net loss from operations per common share ................... . $ (5.45) $ (3.75) $ 3.68) $ (2.36) $ (.01) 
Equity in net assets at year end . . ........................... . $ 307,687 $ 351,578 $ 364,766 $ 308,957 $288,553 
Current cost information 
Net loss from operations ....... .............. . . . . ' 
... ...... ..... $ (204,379) $ (121,464) $ (11 3,9 15) $ (63,776) $ (8,429) 
Net loss from operations per common share ........................... $ (7.77) $ (5.69) $ (5.48) $ (3.08) $ (.41) 
Excess of increase in specific prices over increase in general price level ... $ 76,425 $ 69,094 $ 137,289 $ 99,594 $ 25,009 
Equity in net assets at year end .. . . . . . . . . ' ' 
.......... ' 
....... ' 
.... ' 
$1,135,312 $1,172,238 $ 947,101 $ 784,275 $43 1,047 
Gain from decline in purchasing power of net amounts owed ........ .. $ 33,655 $ 34,454 $ 75, 131 $ 67,817 $ 45,927 
Cash dividends declared per common share-historical .. .. ............. $ .10 $ .20 $ .20 
Cash dividends declared per common share-in average 1983 dollars ......... $ .I I $ .24 $ .27 
Market price per common share at year end-historical .............. $ 3.75 $ 7.88 $ 4.13 $ 6.00 $ 6.00 
Market price per common share at year end- in average 1983 dollars . .. .. .. . $ 3.69 $ 8.04 $ 4.37 $ 6.93 $ 7.79 
Average consumer price index ... ..................................... 298.4 289.1 272.4 246.8 217.4 
23 
 Five-year summary 
OPERATIONS (in thousands, except per share) 
1983 1982 1981 1980* 1979 
Operating revenues . .......... . . . ... . . . ...... . $1 ,511,494 $1 ,530,668 $1 ,448,416 $ 916,715 $609,230 
Operating expenses ...... . ... .. ......... . ..... 1,542,511 1,493,445 1,431 ,960 903,491 581 ,177 
Operating profit (loss) ... . . . ...... . .. . .. . ...... (31 ,017) 37,223 16,456 13,224 28,053 
Net earnings (loss) ........... .. ....... . ... . ... (111,031) (39,861) (46,269) (24,662) 13,061 
Net earnings (loss) per common share- Primary . . .. (4.28) ( 1.99) (2.30) ( 1. 19) .70 
- Fully diluted .. .. (4.28) (l.99) (2.30) ( l. 19) .68 
OTHER FINANCIAL DATA (in thousands, except per share) 
Current assets . . .. .. .... . . . .... . .. . ...... .. ... $ 263,067 $ 328,640 $ 263,296 $ 249,010 $144,691 
Property and equipment-net ...... .. ......... . .. 829,830 846,036 882,196 778,375 399,632 
Total assets ..................... . . . ....... .. . 1,108,672 1,186,174 1,154,567 1,036,226 549,381 
Total long-term debt and capital lease obligations .. 759,395 797,287 722,434 652,257 263,035 
Redeemable preferred stock of subsidiary .. ....... 28,000 28,000 28,000 
Cash dividends per share of common stock . . . .... .10 .20 .20 
TRAFFIC STATISTICS 
Passengers ..... . .... .. ..... . . .. ....... ... ... 17,787,000 18,075 ,000 16,841,000 13,220,000 12,156,000 
Passenger miles (000) .. .. ..... .. . . ..... .. ..... 9,675,000 9,231 ,000 7,641,000 4,760,000 3,847,000 
Available seat miles (000) .. .... .. ....... . . . ... . 17,773,000 16,585,000 15,119,000 10,185,000 7,479,000 
Passenger load factor .. .. ....... .. .... . .. . .. . .. 54.4 % 55.7% 50.5 % 46.7 % 51.4 % 
Cargo ton miles (000) .. ... ...... ... ...... . .... 80,000 65 ,000 51 ,000 37,000 32,000 
* From October I. 1980. Republic Airl ines West. Inc .. a 
consolidated subsidiary acquired on that date. is included. 
Passengers Passenger Miles Seat Miles Cargo Ton Miles 
- 
(Millions) (Billions) (Billions) (Millions) 
- 
18 9.5 17 75 
- 
- 
---- 
- 
15 7.5 13 60 
- ~ 
- 
- 
12 5.5 I 
9 45 
- - 
- 
- 
' I 
n 
9 3.5 5 30 
79 80 81 82 83 6 79 80 81 82 83 1.5 79 80 81 82 83 79 80 81 82 83 15 
24 
 Board of Directors 
Hal N. Carr* 
Chairman of the Board 
Republic Airlines 
Cecil A. Beasley, Jr. 
Partner- Ballard and Beasley 
(attorneys) 
Eric Bramley t 
Retired Editor 
Aviation Daily 
(al'iation industry news serl'ice) 
G. F. DeCoursin* 
Chairman of the Board 
Media Graphics 
(commercial xraphic arts) 
David H. Hughes 
President 
Hughes Supply 
(electrical and plumbing supplies) 
Frank W. Hulse* 
Vice Chairman of the Board 
Republic Airlines 
Alton F. Irby, Jr. 
Chairman 
Fred S. James & Co. of Georgia 
(insurance) 
Officers 
Hal N. Carr 
Chairman of the Board 
Frank W. Hulse 
Vice Chair111an of the Board 
Bernard Sweet 
Vice Chairman of the Board 
Daniel F. May 
President and 
Chief Executile Officer 
Stephen M. Wolf 
Executive Vice President 
Dorman W. Atwood 
Senior Vice President- 
Maintenance and Engineering 
Kenneth L. Hubertus 
Senior Vice President- Customer 
Service 
George J. Karnas 
Senior Vice Presidelll- lnjlight 
Service 
G. Gunby Jordan 
Retired Chairman of the Board 
The Jordan Company 
(construction) 
John M. Lawrence III 
Partner- lcrll'rence, Thornton, 
Payne, Watson & Kling 
(attorneys) 
William R. Lummis 
Chairman of the Board and 
President 
Summa Corporation 
(real estate in1est111ents, a1 
iation, 
hotels and recreation) 
Daniel F. May* 
President 
Republic Airlines 
Morton B. Phillips 
Chairman of the Board 
Westland Capital Corporation 
(business imest111e111s) 
G. Frank Purvis, Jr. t 
Chairman of the Board 
Pan American Life 
Insurance Co. 
* Executive Committee 
t Audit Committee 
A. L. Maxson 
Senior Vice President-Finance 
Henry W. Barkhausen 
Vice President and Treasurer 
John F. Bordi 
Vice President- Co111puter 
and Communications Serl'ice 
J. Kenneth Courtenay 
Vice President- Regulatory 
and Community Affairs 
Edward A. Dingivan 
Vice President- Federal Affairs 
John P. Dow 
Vice President- Corporate Affairs 
Joseph W. Ettel 
Vice President- Industrial Relations 
Gramer D. Foster 
Vice President- Flight Operations 
Earl D. Jackson 
Vice Preside11t- Mai11tenance and 
Technical Senice 
William E. Rankin 
Vice Chairman of the Board 
Summa Corporation 
(real estate inl'e.1 
t111e111s, a1iatio11, 
hotels and recremion) 
Henry M. Rosst 
President 
Ross Industries 
(machinen 11w1111jc1ct11rer) 
Bernard Sweet* 
Vice Chairman of the Board 
Republic Airlines 
Richard A. Trippeer, Jr. 
President 
Union Planters National Bank 
of Memphis 
Wm. Bew White, Jr.* 
Partner-Bradley, Arant, 
Rose & White (011omers) 
Kenneth B. Willett* 
Chairman of the Board 
First Financial Smings and 
Loan Association 
Frank M. Young III 
Partner-North Haskell Slaughter 
Young & Lell'iS (a11orneys) 
Michael D. Meyer 
Vice President and Controller 
William E. Oakes 
Vice President- Marketing 
Charlotte G. Westberg 
Staff Vice Presidellf 
Robert P. Johnson 
Assistant Vice President- Flight 
' Operations 
John E. Mpnger 
Assistant Vice President- 
Long- Range Planning 
Walter E. Nielsen 
Assistant Treasurer 
Gloria B. Olsen 
Assistallf Secretary 
Raymond J. Rasenbcrger 
Assisrant Secrerary 
Ralph Strangis 
Assistant Secretary 
 REPUBL I C A I RL I NES INC 
M I N N E A ~' () l I < , M I N N l C.~ 
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