Republic AirUnes 
Financial 
Report 
For the Second Quarter 
Ended June 30, 1986 
 To our stockholders: 
Republic Airlines earned $35 million in the 
second quarter, equal to 72 cents primary 
earnings per share. It is our second best 
financial performance for a quarter ending 
June 30 and the third best quarter in our 
history. 
The $35 million net profit included 
$3 million, or six cents per share, in tax loss 
carryforwards. 
We achieved a quarterly operating profit of 
$55.3 million on operating revenues of 
$464.2 million and operating expenses of 
$408.9 million. Seat mile costs were down to 
7.68 cents from 8.44 cents a year earlier. 
A year ago, our second-quarter net earnings 
of $120.1 million, or $3.26 per share, included 
extraordinary items totaling $80.2 million or 
$2.19 per share. 
Republic continued to strengthen its balance 
sheet by improving its debt-to-equity ratio from 
3.7 to 1 at year end to 1.2 to 1 currently, 
through retirement of bank debt, conversion of 
debentures and exercise of warrants. 
Our share of the nation's passenger traffic 
continued to grow during the quarter. Revenue 
passenger miles increased 12.6 percent to 
3.21 billion in the quarter with available seat 
miles growing 15.3 percent. This double-digit 
improvement in traffic is particularly 
significant because figures for the second 
quarter last year were inflated by passengers 
gained from a strike at United Airlines. 
For the first half of 1986, Republic and only 
one other major airline recorded traffic 
increases that outpaced growth in capacity. 
From January through June, our revenue 
passenger miles increased 21.5 percent to 
6.09 billion while capacity was up 17.8 percent 
to 10.19 billion. This resulted in nearly a 
2 point increase in load factor to 59.7 percent. 
The growth in capacity can be traced to the 
delivery in May of three more Boeing 757 
jetliners, completing our purchase of six of 
these quiet, fuel efficient, 190-passenger 
aircraft. The new B-757s now are in use at 
each of Republic's main traffic centers in 
Detroit, Minneapolis/St. Paul and Memphis and 
fly high demand routes, principally among the 
hubs and from the hubs to the West Coast. 
Despite the traffic increases during the 
quarter, profits were moderated at Republic 
and industrywide by declining revenue per 
passenger mile. Our second-quarter yield 
decreased 9.2 percent to 13.49 cents from the 
same period in 1985. Nevertheless, careful cost 
control, effective marketing, declining fuel 
prices and employee support continued to be 
the basis for a profitable operation. 
A major highlight of the quarter was a 
June 27 recommendation from a 
 Transportation Department judge that our 
merger with Northwest Airlines be approved. A 
final decision on the $884 million transaction, 
which you approved at our April 23 
stockholders' meeting, is expected before the 
end of July. 
Considerable planning is underway at both 
airlines to ensure a smooth integration of 
Republic into Northwest. The new airline will 
continue our growth at Detroit, Minneapolis/ 
St. Paul and Memphis, and will emphasize 
quality service, convenient flying schedules and 
affordable fares. Routes will span 38 states and 
19 countries. 
Your support of Republic as stockholders will 
be rewarded when Northwest purchases 
Republic stock at $17 per share once the 
anticipated merger receives government 
approval. Your support of Republic as a 
passenger also will be rewarded in your new 
association with Northwest. Northwest will 
acquire and expand Republic's domestic 
strength and at the same time will offer you 
attentive service to a broad range of 
international destinations. 
Your support has not gone unnoticed as it 
has made possible our accomplishments to date. 
We urge you to transfer your allegiance to the 
new Northwest Airlines when the merger is 
completed. 
Sincerely, 
DANIEL F. MAY t/ STEPHEN M. WOLF 
Chairman of the Board President and 
Chief Executive Officer 
July 28, 1986 
 Republic AIrUnes 
Consolidated Balance Sheets 
(unaudited-in thousands) 
ASSETS 
CURRENT ASSETS 
Cash and short-term cash investments 
Accounts receivable-less allowances 
Parts and supplies-less reserves 
Prepaid expenses and other 
PROPERTY AND EQUIPMENT 
Flight equipment owned 
Flight equipment leased 
Ground property and equipment owned 
Ground property and equipment leased 
Less accumulated depreciation, amortization 
DEFERRED CHARGES, OTHER ASSETS . . 
LIABILITIES AND STOCKHOLDERS' EQUITY 
CURRENT LIABILITIES 
Current maturities of long-term debt 
Current obligations under capital leases 
Air traffic liability 
Accounts payable 
Accrued compensation and vacation benefits 
Other accrued expenses 
LONG-TERM OBLIGATIONS 
Long-term debt-less current maturities 
Noncurrent obligations under capital leases 
Long-term pension liability and other 
STOCKHOLDERS' EQUITY 
15% participating non-cumulative junior preferred 
stock, $.01 par value; 10,000 shares authorized, 
7,199 shares outstanding in 1986 
Common stock, $.20 par value; 60,000,000 shares 
authorized, 47,413,315 shares outstanding 
in 1986 
Additional paid-in capital 
Retained earnings 
Employee stock to be issued 
Unearned compensation for stock to be issued 
Consolidated Statements of Earnings Operating Statistics 
June 30, 
1986 
December 31, 
1985 
$ 218,833 $ 300,085 
189,116 158,108 
44,863 35,657 
27,819 34,435 
480,631 528,285 
940,435 924,199 
153,893 153,828 
133,475 130,067 
12,694 12,468 
1,240,497 1,220,562 
517,016 482,230 
723,481 738,332 
13,032 19,680 
$1,217,144 $1,286,297 
$ 17,094 $ 83,802 
8,368 9,207 
159,153 128,647 
81,864 76,776 
55,555 58,230 
73,274 59,039 
395,308 415,701 
293,438 509,434 
120,841 124,225 
54,916 40,856 
469,195 674,515 
9,483 6,713 
257,989 129,097 
84,245 55,076 
6,408 15,699 
(5,484) (10,504) 
352,641 196,081 
$1,217,144 $1,286,297 
(unaudited-in thousands, except per share amounts) 
OPERATING REVENUES 
Passenger 
Cargo 
Other 
OPERATING EXPENSES 
Salaries and benefits 
Aircraft fuel 
Agency commissions 
Rentals and landing fees 
Maintenance materials and repairs 
Depreciation and amortization 
Other 
Operating profit 
OTHER EXPENSES (INCOME) 
Interest expense 
Interest income 
Gain on disposition of property, 
equipment and lease rights 
Other-net 
Earnings before income taxes 
and extraordinary items 
INCOME TAXES 
Earnings before extraordinary items . 
EXTRAORDINARY ITEMS 
Effect of utilization of 
tax loss carryforwards 
Gain on pension plan termination 
NET EARNINGS 
EARNINGS PER COMMON SHARE 
PRIMARY 
Before extraordinary items 
Extraordinary items 
Net earnings 
EARNINGS PER COMMON SHARE- 
FULLY DILUTED 
Before extraordinary items 
Extraordinary items 
Net earnings 
Three Months Ended Six Months Ended 
June 30 June 30 
1986 1985 1986 1985 
$432,636 $422,668 $819,809 $767,423 
19,485 20,787 38,557 41,848 
12,064 12,136 24,563 27,225 
464,185 455,591 882,929 836,496 
142,479 133,613 283,312 259,302 
72,923 91,212 167,467 175,152 
35,350 35,028 70,230 61,656 
25,713 20,095 49,813 38,263 
22,523 16,505 43,718 34,480 
20,361 18,995 40,168 37,927 
89,567 74,386 175,967 145,948 
408,916 389,834 830,675 752,728 
55,269 65,757 52,254 83,768 
16,250 23,211 36,054 45,907 
(3,949) (4,016) (9,010) (6,567) 
(198) (10,773) (10,005) (16,791) 
(1,463) (889) (2,721) (2,298) 
10,640 7,533 14,318 20,251 
44,629 58,224 37,936 63,517 
12,637 18,232 11,787 21,119 
31,992 39,992 26,149 42,398 
3,020 17,980 3,020 20,827 
- 
62,175 - 
62,175 
$ 35,012 $120,147 $ 29,169 $125,400 
$.66 $1.07 $.57 $1.11 
.06 2.19 .07 2.27 
$.72 $3.26 $.64 $3.38 
$.66 $ .90 $.56 $ .96 
.06 1.78 .06 1.86 
$.72 $2.68 $.62 $2.82 
(in thousands, except rates) Three Months Ended 
June 30 
1986 1985 
Passengers 
Revenue passenger miles. . 
Available seat miles 
Passenger load factor 
Yield 
Cargo ton miles 
5,049 
3,207,198 
5,326,615 
60.2% 
13.49C 
26,998 
4,661 
2,847,717 
4,619,802 
61.6% 
14.86C 
29,182 
Six Months Ended 
June 30 
1986 1985 
Passengers 
Revenue passenger miles. . 
Available seat miles 
Passenger load factor 
Yield 
Cargo ton miles 
9,514 
6,086,015 
10,191,990 
59.7% 
13.47C 
53,354 
8,301 
5,008,227 
8,654,706 
57.9% 
15.40C 
60,749 
Highlights of the quarter: 
 Distributing $6.9 million in 1985 profit-sharing 
checks to Republic employees. 
 Adding three more Boeing 757s to Republic's fleet. 
 Enhancing passenger comfort through installation 
of new seats on all 64 of Republic's DC-9-30 
aircraft. 
 Inaugurating service at Moline, Ill., Peoria, Ill., 
and Allentown/Bethlehem/Easton, Pa. 
 Commencing nonstop flights from Memphis to San 
Diego, John F. Kennedy International Airport in 
New York, Orange County/Santa Ana/Anaheim 
and Grand Rapids; from Minneapolis/St. Paul to 
Sacramento and Rapid City; and from Detroit to 
Louisville. 
 Celebrating the first anniversary of Republic 
Express regional airline feeder service at the 
Detroit and Memphis hubs. 
 Opening a 24,000-square-foot flight kitchen in 
Detroit. 
 Earning an American Marketing Association 
award for Republic's "Perks" advertising 
campaign. 
 Accepting national airline sponsor status for 
"Hands Across America," the fund-raising 
campaign for the nation's homeless. 
 Improving passenger service by accepting advance 
seat assignment and advance boarding passes 
prepared by travel agencies. 
 Republic AIrUnes 
7500 AIRLINE DRIVE MINNEAPOLIS, MINNESOTA 55450