Reno Air fires CEO, reports big loss

Friday, Feb. 20, 1998 | 10:33 a.m.

Robert Reding, the Reno Air chief executive who would occasionally take his company's MD-80 jet airliners out for a spin, has resigned in the wake of a disappointing fiscal year in which the company reported a net loss of $12.3 million.

The company, announcing its earnings today, named former United Airlines senior executive Joseph O'Gorman to take the titles of chairman, president and chief executive officer. Former Reno Air Chairman Lee Hydeman will become chairman of the board's executive committee, comprised of directors outside the company.

"Reno Air is fortunate to attract an executive of Joe O'Gorman's experience and proven leadership," Hydeman said in a statement issued this morning. "When Bob Reding became president and CEO in October 1994, Reno Air was struggling for its survival. Bob played a key role in bringing the company through a difficult transition period.

"However, in light of recent developments in the airline industry, including more aggressive competition from the largest airlines, the board concluded that Reno Air would benefit from a change in leadership in helping us to move forward."

O'Gorman recently retired as an executive vice president of Chicago-based United, the nation's largest carrier. A 30-year veteran of the airline industry, O'Gorman, who will take his new positions immediately, also served as president and CEO of both Aloha Airlines in Hawaii and Denver-based Frontier Airlines. In addition, O'Gorman held senior operating positions at United, USAirways and Air California.

Reno Air, which in the past year has more than doubled its number of flights though McCarran International Airport to 27 and has opened a reservation center that employs more than 200, suffered through a dismal fourth quarter that saw the company post a net loss of $12.4 million or $1.17 per share based on revenues of $91.6 million.

In the same period a year earlier, the company showed a loss of $6.3 million (61 cents per share) on revenues of $85.4 million.

For the year, the company reported a net loss of $12.3 million ($1.18 per share) compared with a profit of $2 million (19 cents per share) the previous year. Revenues for the year were $383.9 million, a 9.7 percent increase over the $349.9 million reported in 1996.