Good morning, ladies and gentlemen. I'm Graham Hodges, the Chair of Regis. On behalf of the Board, it's a pleasure to welcome you here to the Regis Healthcare 2024 Annual General Meeting. I'd like to start by acknowledging the Wurundjeri people of the Kulin Nation, the traditional custodians of the land on which we meet today, and pay my respects to elders past and present. I extend that respect to any Aboriginal or Torres Strait Islander peoples joining us today, and a warm welcome to those who are present at the Regis Head Office in Melbourne. Please note the location of your nearest exit, which is behind. In the unlikely event, excuse me, we need to evacuate the building, and please now turn your phones to silent. Recording of the meeting is not permitted, but please note that this meeting is being recorded for webcasting purposes.
I would also like to extend a warm welcome to those attending using the online platform. Should we experience any technical issues during the meeting, you'll be notified of the steps to be undertaken by the moderator. I've been informed that a quorum is present, and as it is now a little after 10:00 A.M., I'm delighted to open the meeting. A notice of meeting has been distributed and will be taken as read. Details about how shareholders can participate using the online platform have been set out in the notice of meeting. Shareholders and proxy holders attending the meeting using the online platform will be able to cast their votes using the electronic voting button once online registration is validated. Excuse me. If you encounter any issues casting your vote using the online platform, please refer to the online platform guide, which includes a helpline number.
Shareholders and proxy holders physically attending can cast their vote using the voting card received during registration. Yellow voting cards will be collected at the conclusion of the meeting by representatives of the share registry. I appreciate that some shareholders may have to leave before the end of the meeting. I therefore now formally open the poll on the resolutions and encourage shareholders who have joined online to submit. I now formally open the poll of the resolutions and encourage shareholders who have joined online to submit their written questions now. There will be an opportunity to ask questions online from the room and on the phone during the meeting. Voting today will be conducted by way of a poll, and all polls remain open until the conclusion of today's meeting.
I will take questions on each item of business after it has been introduced, and questions may be moderated, and multiple questions on a topic will be combined. Excuse me. I would now like to introduce our Board of Directors. Joining me in the room today are Dr. Linda Mellors, our Managing Director and CEO, Mr. Bryan Dorman, Professor Christine Bennett AO, Mr. Ian Roberts, and Ms. Sally Freeman. Jodie Leonard is unwell, recovering from COVID, and therefore will be attending the meeting online. I would also like to welcome the members of our executive team who are in attendance here today. The company's auditor, Ernst & Young, is represented today by Mr.
Brad Pollock, who is available to answer questions in relation to the conduct of the audit, the preparation and content of the Auditor's Report, and the accounting policies adopted by the company and the independence of the auditor. I would like to take this opportunity now to acknowledge Bryan Dorman, the co-founder of Regis, who has decided to retire and will not be seeking re-election. Bryan has been instrumental in the history of Regis and our success. As the joint co-founder with Ian Roberts over 30 years ago, they led Regis's merger with Retirement Care Australia, creating one of the largest private aged care operators back in 2007. Bryan was integral in taking the company through the IPO to listing on the ASX and has remained a director until today. I would like to congratulate and thank Bryan for his leadership, dedication, and commercial insight over the years.
Bryan, you will be truly missed, and we wish you all the very best for the future, and we're very happy that you remain a major shareholder, and while she can't be here in person, I'd like to acknowledge Jodie Leonard, who joined the Board in November 2023 and is an experienced listed company director and commercial leader. Jodie is Chair of the People and Remuneration Committee and has already made a significant contribution to the Board, especially with her deep experience in marketing and remuneration. I'll now outline the meeting agenda. I will present my Chair's address, which will be followed by a presentation from Linda Mellors, your CEO. We will then move to the formal business as set out in the notice of meeting.
After the formal business is finished, the meeting will be closed, and those attending in person will be invited to join the Board and management team for refreshments. Excuse me. I will now move to the chair's address. My comments today will focus on two areas: a brief overview of our FY2024 year with an update on some key business metrics, and second, my observations on the sector today and how Regis plans to participate in future trends. I'm very pleased to report that your company had a successful 2024 financial year. Importantly, your company delivered improved clinical outcomes for more than 9,000 aged care residents and clients we cared for during the year. We saw better outcomes for resident falls, wound and weight loss management, and resident and family feedback on food and services was positive.
This is our core business, and we work hard to deliver improved outcomes each year. Linda will discuss these trends in more detail and our initiatives to further improve outcomes during our next three-year business plan in her address. Financially, Regis had a strong year, delivering excellent growth in occupancy, revenue, earnings, cash flow, and dividends. The improved financial results were driven by a 2.6 percentage point increase in average occupancy, additional government funding, and the acquisition of five homes in Southeast Queensland. Regis reported FY2024 revenue from services of more than AUD 1 billion, up 30% on the prior period, and delivered underlying EBITDA of AUD 107.2 million, up 29%. These positive results occurred in an environment where many providers continued to struggle financially. Regis continues to be a highly cash-generative business, producing strong operating cash flows.
This, combined with disciplined management of the operating business and targeted investments in acquisitions and capital expenditure, resulted in a net cash position of AUD 64.9 million as at 30 June 2024, and we remain in a strong net cash position today. While much of the aged care sector were making losses over the past five years, Regis achieved annual growth rates of revenue and underlying EBITDA of circa 8%, and the company has repaid over AUD 400 million in debt since FY2018. Regis maintained a prudent approach through this period, deferring expensive new developments, pending greater certainty of returns, and instead investing in refurbishing existing homes, upgrading core systems, and investing in our people and processes to ready the company for the inevitable uplift in sector funding that the Board and management knew would come.
Our operating margin has remained stable in recent years as most others in our sector deteriorated, and the recently announced reform package should underpin an improvement over the medium term. Our confidence in Regis's cash-generating ability and the sector's future led the Board to approve an FY2024 final dividend of AUD 0.0664, bringing the full-year dividend to AUD 0.1292 per ordinary share, representing 100% of NPATA, excluding one-off items. Along with an improvement in dividends, your company's share price increased by 96.4% over the course of FY2024, outperforming the ASX 300, which returned 7.7%. I'll now turn to my second topic for today, the sector outlook and Regis's response. The aged care sector is moving through transformational reform. The new Aged Care Act has passed both houses of Parliament with bipartisan support.
The aged care reforms are paving the way for a more promising future for the sector and the community. We expect these reforms to deliver improvements across quality of care, funding, and workforce availability. It is obvious that the aged care sector needs to not only recover but to thrive in the years to come to meet the growing needs of older Australians and their families. We know that there is going to be a significant increase in demand for aged care services. Currently, almost 200,000 Australians are accessing residential aged care, and another 1 million people access home care services every year. The Department of Health and Aged Care has projected that demand for residential aged care will almost double to just under 400,000 residents by 2043, an increase of almost 10,000 residents per year.
Over the next 20 years for home care, approximately 32,000 new recipients are expected each year, or 44,000 per year if latent demand and people on waitlists are included. This would result in over 1.7 million individuals accessing home care by 2043. These numbers are fueled by the baby boomer generation, who are reaching an age where it is likely aged care services will be needed. The number of people aged 85 years and over is expected to more than double from 565,000 to 1.3 million by 2043. To meet these demands, it's projected that the sector will need to build around 135,000 new and refurbished aged care beds over the next decade at an estimated cost of more than AUD 55 billion, and the challenge for the sector is not just about numbers.
With longevity comes more complex and diverse healthcare needs, requiring a higher skilled workforce to care for higher acuity residents and clients. The sector will need experienced leaders and a workforce that can deliver shifting clinical needs of an aging population, and many more of them to meet the growth in both residential and home-based services. Regis will continue to innovate and support these growing needs, including in dementia, rehabilitation, chronic disease management, mental health, palliative, and end-of-life care. Australians are seeking providers that are trusted, can scale up to service the demands of the population, and offer a continuum of care.
As one of Australia's largest and most geographically diverse aged care providers, with over 11,000 dedicated staff delivering care and services to more than 9,000 older Australians through residential aged care homes, home care hubs, day therapy, and respite centers and retirement villages, we expect Regis to play a leading role in supporting the sector. As we look to this future, how Regis positions itself to meet these shifting dynamics is informed by a deep understanding of the evolving needs and expectations of residents and clients, the opportunities within our sector, and the strengths that differentiate Regis from others. Regis's strategy is not just about meeting current demands, but anticipating future needs of our residents, their families, and the community, and setting leading standards in aged care. Core to the strategy is a culture of excellence that delivers exceptional value.
Linda will address the details and the areas of focus of this strategy in a moment. Regis has a long history of greenfield developments, building modern, purpose-built, and desirable aged care homes for older Australians, ensuring high standards of care and service. Government underfunding and regulatory uncertainty led a sector-wide capital strike with only 6,500 net new beds constructed across the last four years. From 2019, Regis paused capital investments in growth, only resuming its greenfield development program in September 2022 with the construction of our 112-bed Camberwell home. This home opened to new residents just this month. Together, the Camberwell development and the acquisitions of five homes in Queensland late last year and two in Victoria that will settle in early December add over 1,000 premium beds to our portfolio in the 12 months. Your company continues to seek attractive acquisition opportunities as we accelerate our growth agenda.
Aligned with our long-term goals, Regis will continue to pursue acquisitions of high-quality homes, which meet disciplined criteria to ensure these investments are earnings-accretive and have long investment life in an environment of rising resident expectations. Occupancy has increased across the sector, with StewartBrown reporting an average sector occupancy of 92.6% in FY2024. Regis continued to outperform with our average FY2024 occupancy of 94.1%, rising to a spot occupancy of 96% as at 31 October 2024. The lack of additional new beds coming to market and the rapidly escalating demand curve will continue to exert upward pressure on occupancy rates across the country. Regis is confident that the greenfield developments will perform strongly in an ongoing environment of short supply.
To take advantage of this expected market tightening, Regis has three greenfield developments, two in Sydney and one in Brisbane, which have been approved by the Board and will come to market over the next few years, adding a further 323 premium beds to our portfolio. Management is working to rebuild our company's land bank to ensure that we have suitable future development sites in the portfolio. Regis's sound financial management and very strong balance sheet has positioned us well to invest and expand our operations. Your company has the capacity to pace acquisitions and new developments for effective cash flow management. Our ability to invest is also underpinned by the government's once-in-a-generation aged care funding reforms, as outlined in the new Aged Care Act. The changes to accommodation funding, including RAD retention, will improve returns for aged care providers.
In closing, I would like to thank my Board colleagues for their support over the past year. And on behalf of the Board, I want to express my gratitude to our Regis frontline staff, support staff, and executives for their dedication and support to our residents, clients, and their families over the past year. And finally, I want to thank you, our shareholders, for your continued support. I will now hand over to Linda to address the meeting. Thank you.
Thanks very much, Graham, and good morning, everybody. I'd also like to begin this morning by acknowledging the Wurundjeri people of the Kulin Nation and paying my respects to their elders past and present, and I extend that respect to any Aboriginal or Torres Strait Islander people joining us today. As Graham mentioned, over the last 12 months or so, there's been a positive shift in sentiment within and about the aged care sector. This shift is attributable to significant pay increases for eligible frontline workers, the government's progress with its reform agenda, and the bipartisan agreement on historic funding reforms aimed at making a fair, equitable, and sustainable aged care system. There still remain substantial challenges for the sector, including the imminent arrival of the baby boomer generation, a shortage of fit-for-purpose aged care beds, and uncertainty about the workforce expansion that will be required.
Even with improved funding and profitability, the sector is facing a considerable shortfall of suitable beds in the near term due to the time required to build new stock. In response, Regis has and continues to invest in greenfield development projects and extensive refurbishment of some of our homes, in addition to our ongoing acquisition activity. While the industry remains highly fragmented, consolidation is occurring as many smaller providers remain loss-making and/or are struggling under the significant regulatory and compliance requirements of this sector. Today, I'll share my thoughts on the progress of the aged care sector reforms, followed by an update on Regis's key drivers of business value. I'll also touch on our Q1 performance for FY2025, our growth agenda, and finish with some comments on the outlook. Slide 11 highlights the key government reforms that are impacting the aged care sector.
The Royal Commission into Aged Care Quality and Safety determined the current Aged Care Act to be outdated and recommended a new act to create a simpler, safer system, strengthen the regulator's powers, and provide residents with more choice and control. The Aged Care Bill 2024 has passed both houses of Parliament and was approved yesterday. Subject to transitional arrangements, the new Aged Care Act is expected to be operative by 1 July 2025. The new act will establish a modern rights-based framework focused on the safety, health, and well-being of older Australians, strengthen quality standards, and set clear expectations for providers in delivering quality care and services. Residential aged care funding has improved, with the Independent Health and Aged Care Pricing Authority advising the government on pricing.
The industry-wide AN-ACC starting price increased 10.3% in October 2024 to cover the higher average care minute targets, the Stage 3 Fair Work Work Value Case decision, award wage increases, other direct care costs, and indexation. The Pricing Authority should ensure that care funding remains adequate to compensate providers for rising costs in providing quality care, especially through increased wages. From 1 July 2025, the new Support at Home system will be introduced, replacing the existing Home Care Packages and Short-Term Restorative Care program. The Pricing Authority will recommend initial pricing for services on the Support at Home service list and will provide annual pricing to the Minister for Aged Care. Further details about the services and initial pricing schedule should be released soon. The Commonwealth Home Support Program will transition into Support at Home no earlier than 1 July 2027.
In March 2024, we were pleased the Fair Work Commission finalized its Stage 3 decision on aged care wages. This decision grants eligible care and support workers an additional pay increase of up to 13.5%, which we phased in from January 2025 and October 2025. This is on top of the 15% increase in modern award wages to eligible care workers from 30 June 2023 and increases to minimum award wages as part of the Annual Wage Review. As noted previously, the increased AN-ACC price funds these increases. In October 2024, the Fair Work Commission provided provisional views regarding the classification structure in the Nurses Award, the rates of pay, and phasing in. We await a final decision from Fair Work and guidance from the Department of Health and Aged Care on timing and funding for additional wage increases to registered and enrolled nursing staff.
Also, in October 2024, mandated care minutes increased, requiring providers to achieve an average of 215 minutes of direct care per resident per day, including 44 minutes from a registered nurse. We were pleased that the government recognized both the vital role of enrolled nurses and the ongoing shortfall of registered nurses in the sector, allowing enrolled nurse minutes to contribute up to 10% of the registered nurse requirement. For Regis, these reforms have allowed us to employ more people to care for our residents, provide higher salaries and wages for the bulk of our frontline workers, and increase our employee retention rates, so moving now to the government's response to the Task force recommendations, noting the Task force was established to review funding and financing of the sector, excluding care funding through AN-ACC given the work of the Pricing Authority.
In March 2024, the Task force's findings were made public, encompassing a set of 23 recommendations aimed at ensuring the sector's enduring viability. The government responded to the recommendations in September 2024, mostly through the new Aged Care Act, which will bring key funding and financing changes. The acknowledgment of the urgent need for change by parliamentarians was welcomed by the sector. There are four key sources of revenue to deliver residential aged care services, separated into care, everyday living, accommodation, and additional or extra services. I'll spend some time now explaining the impact of the reforms on these revenue lines. The new arrangements will separate care into clinical and non-clinical activities. In terms of clinical care, the government will fully fund these activities for all residential aged care residents. The means-tested care fee will be abolished and replaced with a new means-tested non-clinical care contribution with a lifetime cap.
Non-clinical care includes activities like bathing, mobility assistance, and lifestyle. Today, providers receive two payments for everyday living activities: the basic daily fee, which is set at 85% of the single basic age pension paid by the resident, and the Hotelling Supplement paid by government. On average, residential aged care providers are losing money providing these everyday living services. A key element of the Task force recommendations was that residents with means should make greater contributions to non-care components such as everyday living and accommodation costs. The Hotelling Supplement will now be means-tested, with consumers who can afford to making a larger contribution. In terms of accommodation, a Refundable Accommodation Deposit retention scheme will recommence for new resident admissions from 1 July 2025, set at 2% per annum up to a maximum of five years.
This means providers will be able to retain a portion of incoming RADs and potentially use this to build new or refurbish existing homes. The accommodation supplement, which is paid by government for concessional residents, will be independently reviewed over the next two years to ensure sufficient incentives are in place for providers to improve the quality of accommodation and accept lower means residents. From 1 January 2025, there will be an increase in the maximum room price from AUD 550,000 to AUD 750,000 before regulatory approval is required from the Pricing Authority. This is in line with the price threshold recommended in the 2017 Tune Review. The government will commission an independent review of sector readiness in FY 2030 to consider phasing out RADs by 2035.
This review will determine whether the sector can secure adequate levels of capital from alternative sources and if the removal of RADs would make residential aged care unaffordable for many consumers. We understand there is resistance to this recommendation from the large banks who currently finance the sector. A number of residential aged care residents pay an additional or extra services fee towards more premium everyday living services, such as pay TV or alcohol with meals or higher level accommodation. The government is proposing to replace additional and extra services fees with a new higher everyday living fee. Much of the detail will be in the rules, which are yet to be published.
Regis is monitoring the communications from government to determine the extent of changes that might be set out in the new rules, but remains concerned that the new laws might inadvertently reduce informed choice for consumers and the incentive for providers to innovate and expand their offerings. Moving now to the key drivers of business value for the long-term success of our company. Regis is committed to ongoing sector leadership by investing in our care outcomes, our people, homes, and development pipeline and systems and processes. At Regis, our unwavering commitment to delivering exceptional care and services to our clients and residents is the foundation of our enduring success.
Our approach to clinical care has been significantly enhanced through a number of targeted initiatives and a strong clinical research agenda, resulting in notable improvements in a broad range of care outcomes, including pressure injuries, restrictive practices, weight loss, falls with injury, and medication administration errors. Regis has achieved these improvements through targeted training programs, changes to care protocols, and new technologies. Regis continues to partner with a range of universities on research projects that are meaningful to our residents, clients, and employees. One such project underway is the development of an app to measure and monitor risk-adjusted quality indicators in real time. We are also partnering with universities on palliative and end-of-life care improvements. We created a clear implementation plan to achieve the enhanced quality standards, with much of the work completed ahead of the expected 1 July 2025 effective date.
The company's approach to quality in a residential aged care setting was showcased at the ACCPA National Conference in October 2023, and our use of data and the quality scorecard was showcased at the Aged Care Quality and Safety Commission's National Aged Care Provider Conference in April 2024. Our staff are benefiting from new technologies and systems such as AI and machine learning to improve employee experience, boost productivity, and foresee clinical trends. We intend to expand these programs over the next three years. We continue to excel in customer experience with high ratings and Net Promoter Scores received from our residents and families. Along with our lifestyle program, a highlight was our inter-home events that brought together residents from multiple homes for memorable celebrations and nostalgic activities.
On an employee front, we are delighted to report an 86% employee sustainable engagement rate in our last staff survey, outperforming the Australian national norm by six points. Our Lost Time Injury Frequency Rate stands at an industry-leading six, significantly lower than the sector average of 24. We continue to seek improvements in our performance to keep our people safe and engaged at work. We also recently implemented a new enterprise-wide people management system to improve employee experience, increase efficiencies, and ensure accuracy and reporting compliance. As with other system implementations and upgrades over recent years, the new system is scalable to accommodate our planned growth and reduces human resource needs in our support functions. 80% of Regis's total workforce are female, with balance between men and women at Board and executive levels. Over the past four years, Regis has eliminated the earnings gap between men and women.
This is a meaningful achievement and very well received by our employees. Regis offers staff significant career progression opportunities and varied career pathways not available at many other providers in the sector. Many of our management roles are proudly held by people who began their careers in frontline roles at Regis, highlighting our commitment to nurturing talent and providing opportunities for career growth within our company. With our disciplined financial management over the past five years, including paying down debt, Regis has been able to complete acquisitions with cash, improve our systems, and recommence greenfield developments. Regis now has a sizable war chest available as we move into our next three-year strategic plan.
Moving to our strategic plan, which once again coincides with a time of major reform, Regis remains committed to disciplined financial management with targeted strategic investments to drive growth in occupancy, revenue, earnings, and ultimately shareholder value. Our strategy sets an ambitious course for the next three years, leveraging our culture of excellence and focusing on growth and innovation. Our growth is targeted around five key areas: expanding our residential aged care footprint through acquisitions and some greenfield and brownfield developments, offering top-tier lifestyle and additional services to enhance the well-being of our residents and clients, exploring innovative and more efficient aged care models, providing an exceptional concierge and dining experience, and building scalable home care hubs to meet growing demand. We continue to seek operational efficiencies through technology and redesigning ways of working. We're already making substantial progress towards achieving the objectives outlined in our strategic plan.
Moving now to our growth program, in September, Regis announced the acquisition of two premium residential aged care homes on the Mornington Peninsula in Victoria, with 262 beds from Ti Tree Operations opened in 2014 and 2018. These two homes are consistent with Regis's acquisition criteria to broaden our residential aged care footprint in metropolitan locations with quality and contemporary homes with an excellent compliance history and solid reputation in the local community. The Ti Tree transaction is expected to complete on Monday next week, the 2nd of December, and will increase Regis's beds in Victoria by 15%. Regis continues to actively engage in sector M&A and considers acquisition growth a key lever to improving shareholder value. Along with acquisitions, Regis intends to continue growing the market with demographic and funding changes supporting new builds.
The newly opened Regis Camberwell is expected to ramp up over 12 months and will be a valuable asset for the company and the local community for many decades. With tightening supply in the market, we expect that new developments will have very strong consumer demand. Regis has three greenfield developments with construction soon to commence at Toowong in Queensland, Belrose, and Carlingford, both in New South Wales, which will add 323 quality beds to our portfolio, and we continue to actively scour the market for additional development sites to build our land bank and expand our development pipeline. Our strong performance in FY2024, as highlighted by Graham, has continued into the Q1 of FY2025, and we are currently tracking modestly ahead of our internal profit target. Our average occupancy improved from 94.9% in the Q4 of FY2024 to 95.5% in the Q1 of FY2025.
As Graham mentioned, spot occupancy on the 31st of October was 96%, tracking ahead of budget. Aged care government revenue per occupied bed day increased to $299.30 in the Q1 of FY2025. Regis's average actual care minutes per resident per day were 210.1 in the Q1 of FY2025 against a target of 212.9 minutes. The increase in care minutes worked reflects the extensive efforts of our talent acquisition and operations teams. With care minutes targets increasing again on the 1st of October 2024, Regis continues to offer existing employees additional hours as well as sourcing new workers. As mentioned, the 1 October 2024 AN-ACC increase will cover the costs of the Fair Work Work Value Case, Annual Wage Review, and the uplifting care minutes. Some final comments now on the outlook for the year.
Regis continues to adapt to the evolving regulatory landscape and anticipates future benefits from rising demand, better workforce availability, increased government funding, and targeted strategic investments in acquisitions and developments. Regis welcomes the recent government funding reforms, which are essential to restore the sector's viability and meet the current and growing needs of older Australians. With a robust balance sheet, substantial undrawn debt facility, and strong net RAD cash inflows, Regis is well positioned to both actively pursue material acquisitions and construct greenfield and brownfield developments. I'd like to extend my heartfelt thanks to our more than 11,000 employees for their unwavering dedication, commitment, and compassionate care provided to our residents and clients every day. The Board and executive team are dedicated to enhancing the quality of care and services for our residents and clients and supporting our teams to achieve this.
This focus continues to be the greatest driver of value, as well cared for and engaged residents, clients, and employees lead to higher occupancy, lower turnover, and greater financial returns. I'd also very much like to thank Bryan Dorman for his wisdom and the very generous sharing of knowledge about the sector over the five years that I've been here. Thank you, Bryan. I'll now hand back to Graham to complete the formal part of the meeting.
Thank you, Linda. I'll now outline the question and voting procedure for today's meeting. As this is a shareholders' meeting, only shareholders, their attorneys, proxies, and authorized company representatives are permitted to vote and speak at the meeting. The process today will be that I will introduce each of the six items of business separately, take questions, and then, if applicable, invite voting on the item.
We will address online questions first and then move to questions from the floor, followed by any telephone questions. The first item in relation to the adoption of the Annual Financial Report, the Directors' Report, and auditor's report will be your opportunity to ask questions relating to the management and operations of the company generally. If your question relates to another item of business, please ask your question when we come to that item of business. Please ensure your questions are relevant to shareholders as a whole, and I encourage shareholders attending online who have questions to send their questions through as soon as possible. Please click on the Ask Question button, type your question, and click Submit. The online questions will be moderated by our Company Secretary, Malcolm Ross.
For those attending in person today, to ask a question, please raise your hand or voting card when prompted at the relevant item of business and wait for an attendee with a microphone to come to you. Please then introduce yourself before asking your question. Shareholders and proxy holders wishing to ask questions via the phone were required to register for their unique PIN provided by Link Market Services. If any shareholders, proxies, or their representatives who have dialed in wish to ask a question, we ask that they select Star One on their phone keypad. They will then receive instructions as to how to ask a question during the meeting from the phone moderator. If you're also watching the annual general meeting online, please mute your device when you're asking a question on the telephone line.
To give all shareholders a reasonable opportunity to be heard, please ask no more than two questions at a time and limit your questions to no longer than two minutes. I will now explain the voting procedure. All votes to be conducted at the meeting will be by way of a poll, which means that each shareholder has one vote for each share held. Resolutions two, three, four, five, and six set out in the notice of meeting are to be considered as ordinary resolutions and, as such, must be approved by a simple majority of votes cast by shareholders entitled to vote and voting on the resolution. As I get to each resolution, we will display the eligible proxy votes, the number of holders who voted, and the percentage of issued capital which has been voted after the discussion on that item of business.
I confirm that I intend to vote any proxies left to my discretion as the chair of the meeting in favor of each resolution. The final results of the poll will be announced to the ASX after the meeting. We will also post results on Regis's website. An officer from the company's share registrar, Link Market Services, will act as a returning officer in relation to the poll. So now to the formal business of the meeting. Item one, which is the financial statements and report. Ladies and gentlemen, the first item of business is to receive and consider the financial statements and report of the company and its controlled entities and reports of the directors and the auditor for the year ended 30 June 2024.
While there is no requirement for a vote on this item of business, this is an opportunity for shareholders to ask questions relating to the company's financial results, the management, and operations of the company. Any questions in relation to remuneration items three, four, five, or six will be considered when we come to those items of business. As I previously mentioned, Mr. Brad Pollock is representing the company's auditor, Ernst & Young, and is available to answer questions. So, Malcolm, we turn first to the online questions. Are there any online questions for today?
Thank you, Chairman. There are several online questions. The first one is directed to our auditor, which I'll read. Ernst & Young have been our external auditor for the entire 10 years that we've been a public company. What is the history of EY's relationship with the business, and when did we last run a full tender for the audit job, and when are we expecting to tender again? Also, some public companies, such as EY, insist on having two partners to sign accounts. Could our solo signing EY partner, Brad Pollock, explain why he doesn't need a backup to handle the audit?
So maybe I'll take the first part of that question, which is our external auditor has been here 10 years. Well, we have used EY as our auditor for the full period of our listed period. The partner representing EY and many of the individuals who've worked with Regis have rotated out the partner each five years, and we're just rotating Brad out, actually, and we welcome Paul Gower as a new partner who's going to be heading EY's audit for Regis.
In addition to that, we review the performance of the auditor each year at the Audit Committee and at the Board and consider the appropriateness of the performance, the cost of the audit, and their contribution in terms of supporting the company. And the Board remains very supportive of the way EY has helped us over what's been a quite difficult last five years with Brad in charge of the audit. And I'd say looking forward, a consistency in keeping our auditor at the moment, in my mind as chair, would be very helpful given we're moving into new arrangements under ESG and reporting on that. And so having an auditor who understands our company well and has long experience with it, I think, will be very helpful in us setting some of the targets we're now expected to do by the 1st of July 2025.
I mean, my final comment would be that we actually outsource quite a bit of our internal audit to Deloitte, and we have done for quite a number of years. So we do get sort of an additional sort of perspective in terms of the way the business is run by the way Deloitte goes through many of our functions and processes as part of an internal audit process. So at this stage, we haven't a plan to tender out our audit, but clearly that remains one of the things which the Board looks at each year as it reviews the performance of the auditor. I might now perhaps ask Brad to comment on the signing of the accounts and any other comments he might want to make.
Thanks, Graham. In terms of the second part of the question, each of the engagement teams and our clients are selected based on the size and nature of the individual organization, the nature of the audit and financial reporting risks for the particular client, and then the type of expertise that's needed on our team to address those audit risks. In the case of the Regis audit specifically, I'm assisted by five other partners that are part of the engagement team. They cover tax and assist me in the audit of the tax balances, an IT risk and cybersecurity partner, an accounting technical partner, and financial reporting, a corporate valuations partner, and also to assist me in auditing the valuation of the investment properties that Regis holds. There's a property valuations partner involved as well.
In addition to those partners I just mentioned, there's a number of other managers and other audit analysts with varying degrees of experience that work with me on the audit. And that audit team is also subject to review by an independent engagement quality review partner whose role is to challenge and assess the audit judgments and conclusions that are reached. So that whole team supports me whilst I have ultimate signing responsibility for signing the audit report that you see in the financial statements. There's a number of people working with me in the background to support the audit conclusion.
Thank you very much, Brad. So maybe, Malcolm, are there any other questions for online?
There's another question. The first was from Stephen Mayne, so it was this question. After Bryan Dorman's retirement, we'll be down to just six directors, including the CEO. Co-founder Ian Roberts will be the only non-independent director, courtesy of his 27.21% stake, which has remained steady since the IPO. Having seen his co-founder sell 17.5 million shares, AUD 3.80 a share in May this year, could Ian please comment on whether he has any similar retirement or sell-down plans? Also, given the two co-founders together own 48.6%, how is it fair that they will only have 16.6% of the Board seats going forward?
Maybe I will take the second part of that question, and then I'll ask Ian if he has any comments to make on the first part of it. I mean, regarding the second part about the shareholding and his representation on the board, we as directors understand that we actually are working for all shareholders, irrespective of the size of their holdings.
And I must say it's been a joy to work with directors who take a total shareholder perspective and not an individual one. I don't recall any period in my time where there's been a major issue around the shareholding other than a time when we had an acquisition and there were some differences around the board on that. So I think the board works as a collegiate team, and we never really think about the percentage ownerships of the shareholders who actually are sitting on the board. So perhaps Ian and I could ask you whether you want to make any comments on the first part of that?
Oh, I was going to go to the second part, Graham, but more than happy to. Or the second part, yeah. Right. The answer to the question that was put to me is that no, I don't have any direct retirement plans at the moment, nor do I understand Galabay's got any proposal to sell down their interest in the shares. I think we're entering into a really interesting period of time, and hopefully I'll be able to contribute going forward. Probably want to take this opportunity to thank Bryan. It's been a great journey, and I hope we wish you all the best going forward.
Thanks, Graham .
Okay. Oh, yeah. Thank you, Ian. Are there any other questions?
Yes, there's one more question, which is a thank you from Stephen Mayne to Bryan Dorman for co-founding the company in the early 1990s and serving on the board for the last 10 years. He says it's always helpful for investors to have access to some exit perspectives from retiring directors.
His final contribution as a director, could Bryan comment on what he regards as the best three decisions made during his time with the company? And does he have any regrets, potentially including the brief takeover dalliance with , Soul Pattinson in 2020? What was that about?
So Bryan, I offer you the opportunity to make a last statement as Stephen has requested.
Thanks, Graham. Well, I don't really think I need to add anything to Soul Pattinson's exercise other than to say, is that all? Yep. Other than to say that subsequent to that, we had the Royal Commission, and coming out of that has been the bravery and commitment of the Labor government to reinvigorate the industry after the previous government's complete neglect of it for many years. Right now, we're in a very good position going forward with excellent management and a good board behind it.
So I think we've got favorable winds for a few years ahead. We've just got to maximize our opportunities. Got a great balance sheet. So I'm very positive. Subsequent to today as a shareholder, I'm very comfortable with where we're at and where we're going.
So thank you very much, Bryan. Thank you.
Are there any other questions?
Yes, Chairman. We have one more question from Stephen Mayne. The accounts claim we lost 21.4 million in 2023 to 2024 and now have $202 million in accumulated losses and negative equity of 22.8 million. How can these numbers be so wildly divergent from the stock market's assessment that our equity is worth $2 billion after the share price quadrupled in 18 months? Given this history in banking, could Chair Graham Hodges explain how any bank would lend to such a seemingly financially weak entity? Given ASX-listed property trusts revalue their property holdings every six months, why don't we do the same?
Thank you, Stephen, for the question. The reason for the losses on the accounts is due to the amortization of our bed licences, which the government required us to amortize our assets over a three-year period. And that's affected each half over those three years where we've had a statutory loss, if you like. And that's why those numbers look like they do. In terms of the actual company and its performance, we obviously have adjusted that for shareholders to better understand what the underlying performance of the company is, which is why you've seen in our accounts sort of an underlying performance. So yes, that has affected the equity, if you like, but we expect that will be restored over the next few years.
In terms of the company's worth and its performance, clearly a lot of the assets which the company has and it owns outright, all of the homes on our balance sheet, all 68 homes, they're mainly at cost on our balance sheet. And so if we looked at the market value of those homes, if they were valued at market value, they would be significantly more. So I think the banks very clearly understand the policy change the government made with the elimination of bed licences, which people had to pay for before, and the impact that that's had on the sector. And I think quite rightly, the shareholders can look through that and see the future of Regis and its value. Are there any other questions online?
Yes, Chairman. We have one more question. Okay, final question from Stephen Mayne in this section. Many thanks for holding a hybrid AGM today and for disclosing the proxy position early to the ASX, including shares and shareholders' metric. This is best practice and well done indeed for receiving such strong voting support on all resolutions. I'm guessing this means none of the proxy advisors recommended against any resolutions today, including this remuneration report item. Just a comment.
Yeah, and I can confirm that none of the proxy advisors recommended against any of the resolutions. And in the last two months, I went and met with five proxy advisors and a number of shareholders in the lead-up to the AGM. And I must say that we received strong support for the resolutions today.
Chairman, we have one more question, which is why are our dividend frankings 50% and not 100%? It's from Robin Kedley.
Largely because we don't have the franking credits to frank at 100%, and we'd rather pay out the full amount of the NPATA to shareholders because we do understand that it's been a quite challenging period over the last five years in the sector, and we think maximizing the dividend flow has been important rather than just reducing the dividends in order just to maximize the franking. So the board's strategy has been to ensure that we provide as high a level of cash dividend as we can.
No further online questions.
Okay, so I'll turn to the room. Are there any questions from shareholders in the room? I've got a question here. So Peter, maybe you could just stand, use the microphone, introduce yourself, and then we can ask the questions.
Thank you. Peter Eynon , a volunteer with the Australian Shareholders' Association. Today I'm holding proxies from five of our members. I would like to firstly acknowledge the contribution that Mr. Dorman has made to this business and wish him all the best for his future. I'm a bit concerned about your reporting of safety statistics, which your CEO mentioned. On the pages of the annual report, you indicate an LTIFR of 5.95, but further on in the report, the STI outcomes with a target of 10 was not achieved. I'm just wondering how the difference between the numbers that you've reported have arisen.
I'm happy to answer that one, Peter. The statistics that we quoted in terms of industry-leading performance are correct. We set ourselves what might be termed an overly ambitious target to keep improving off that very low base, and we missed it by one LTI. But it's a binary measure, so it was classed as not met.
And Peter, I could just add, clearly this is a factor in the STI, and it was worth 10% of the STI amount. So it was scrutinized as well by the chair of our remuneration committee to make sure that we were one over what we had as a target. And as a result of it, all of the employees lost 10% of their STI. So we do take those sort of safety factors very seriously, as we also do for the clinical care. And as you'd appreciate, in the STI, we also have a gateway of where we have to perform well or otherwise you can lose up to 100% of your STI.
It's one of the gateways, and I think it's a really important one on safety because, frankly, aged care is a very physical occupation for many of our employees, and ensuring that we have a good safety performance is a really important factor for us.
I certainly appreciate that you take good notice of issues such as this in the STI. A question for the auditor. Your key audit matters include the valuation of investment properties and the acquisition of the CPSM. According to note four in the annual report, the value of property, plant, and equipment, you do not subject the independent market values assessments of aged care homes to audit. Given that the balance sheet shows negative equity, do you have any concerns about the valuation of assets?
I might ask Brad to respond to that. Do you want to use the microphone? Peter will give it to you.
Certainly, all the asset values are subject to audit, including the acquisition of CPSM. So perhaps the note you're referring to is talking about the way in which the acquisition accounting was taking place. It's provisionally accounted at the date the accounts were issued, which is permitted under the accounting standards, but the properties and the plant equipment were subject to audit as part of the audit of the acquisition of CPSM. And in fact, all of the balances for the rest of the Regis business are also subject to audit as well. Does that answer your question?
You'll need the mic.
Sorry, why are the values so low for the properties that are owned, which I appreciate Mr. Mayne has also identified as an issue?
In terms of the values, the auditor, I'm not really in a position to comment as to why those values are low. As Graham mentioned earlier in answer to one of the other questions, a large part of the company's property portfolios held at historical cost as required by the accounting standards. When a business is acquired, such as CPSM was during the period, those assets are recorded at fair value. So those values do reflect market value at that point in time. And that's a relatively small number of homes in the context of Regis's balance sheet. But the remainder of what you see in the property, plant, and equipment note and other asset categories are held at historical cost, i.e., they don't reflect current market value.
Keep going.
Yeah, yeah, so that's all right.
Thank you, Peter.
I'm just noting that you have made some notes to the recommendations of the Aged Care Taskf orce. But I just wondered if you'd like to comment any further on the retention of some of the RAD, which is being opened up from next year, I think, and the possibility of phasing out the RAD from 2030.
Yeah, look, I'll make a comment if Linda might want to add to what I say. But in terms of the retention, this is a policy which had been in place, I think, until about 2016. And what it did, it reflected the fact that part of the bond was retained by the operator and used to help further develop facilities or modernize them or renovate, refurbish. So there are uses for those funds.
I think that what the government's realized is that at the moment or over the last six or more years, having removed the retention, there's less funding available for operators to invest, refurbish, etc. So by restoring retention at 2% for five years, it's allowing operators to feel more confident about the returns they'll get on reinvesting in the sector, which, as I said as part of my speech, we're looking at a need of something like 135,000 beds over the next period. And unless there are sort of better incentives for that investment, they're unlikely to appear. And of course, that will cause significant issues for older Australians. So in terms of that, I think that's the rationale for it. And I think the industry's welcomed that. In terms of phasing out RADs, there was a recommendation in the Royal Commission about phasing RADs out.
What followed after that in terms of conversations was, what is the mechanism by which the sector will fund itself if RADs aren't available? And at this stage, I don't believe there's been a viable alternative presented. There will be a review done in 2029-2030 to review that process again. But if you spend any time with the banks or other finances around this, RADs are a very important part of operators effectively getting quasi-equity, which is sort of used in the balance sheet. And I think the main risk around the RADs remains a liquidity risk, that they've got a substantial amount of money, which we hold on behalf of residents, and we need to repay those residents on departure from the aged care facility. So you need to make sure that you've got adequate liquidity as an organization in order to meet that.
So I think the government does worry that there's a sort of contingent liability on the Commonwealth balance sheet around that. And so all of that will be looked at in 2029-2030. Personally, I think it's a really difficult issue to solve for. So we'll have to wait and see. Yeah, if you want to. Just Peter, Linda might add one other comment.
Just to add to that, so the government doesn't contribute capital to our sector. And I think that's something that's often missed in the commentary around aged care. So the rules will contain the percentage of the RAD retention. We understand it will be set at 2%, as the aged care minister has said. The intent is to restore viability to the sector and incentivise building.
So Australia will run out of aged care beds in the very near future, and we have the baby boomers coming our way. So there needs to be a large building program across the country. So this is the way of incentivizing more providers to build. I'd also just comment, with the phasing out of RADs, I haven't seen anybody come up with a better option than RADs. It's a very efficient way of providing capital to the sector. Residents have been getting 100% of the RAD back. That will now be 98% after a year. I think if you have a look at the evidence that the banks gave to the Royal Commission into aged care, they said that they would not support the sector without RADs.
Thank you. You've increased your dividend to shareholders again this year, and in line with your policy of 100% of net profit after tax and before amortization. When was this policy agreed, and were the two directors who benefit very significantly from this involved in the decision? And also, given that your balance sheet shows negative equity, should you be retaining some of your earnings to build the balance sheet up again?
So we took that decision, I can't tell you exactly which year, but it must have been about three years ago. And that was following the government's requirement on us to amortize the licences. We had obviously lost positions. We had a sector which was not in favor. We had shareholders who had stuck with us, and we felt it was appropriate that we pay out 100% of our underlying earnings.
We still had sufficient cash around us and a capacity to fund what we needed to do internally, and we felt that money was best to be put back to shareholders in dividends, and that was a board decision. The board decision is sort of not a vote, if you like, on these decisions. They're more consensus, but when we take those decisions first in the audit committee and then at the board, it becomes a decision really more of the independent directors have an absolute say in terms of what we do and how we do it, so as I said right at the very start, our board operates with a view on looking after all shareholders, not individuals on the board, and it hasn't happened, so I think that process is very tightly managed and I think appropriately managed, Peter. Are there any other questions from the room?
Okay, so if there are no further questions, I will now turn to the next item of business, so the next item of business is the election and re-election of directors. Bryan Dorman and Christine Bennett's terms both come to an end at today's meeting. As mentioned during my opening address, after more than 30 years of co-founding Regis, Bryan will be retiring as a non-executive director following the close of today's meeting. Being eligible, Christine is standing for re-election at this meeting. Miss Jodie Leonard, who joined the board on 28 November 2023, and in accordance with the ASX listing rules, must not hold office past the annual general meeting without an election, is standing for election today. Christine and Jodie's credentials are detailed in the notice of meeting, so I'll first turn to item 2.1, which is the re-election of Christine Constance Bennett as the director.
The board, with Christine abstaining, unanimously supports the re-election of Christine Bennett as a director of the company. I now invite Christine to provide a brief address to the meeting regarding her re-election.
Thank you, Graham. And good morning, everyone. Well, I'm Christine Bennett, and it's my great pleasure to offer myself for re-election as an independent non-executive director of Regis Healthcare. It's been an absolute privilege to serve on the Regis board since early 2018, and I currently chair the Clinical Governance and Care Committee and also sit on the Audit and Risk and Property Committee. I'm very proud of what we've achieved in establishing and continuing to develop our clinical governance at Regis with a very talented and committed leadership team. The last six years have been an incredible journey.
We've had challenges, changes, floods, fires, global pandemics, as well as historic aged care reforms, which are now passed through the legislation of the New Aged Care Act. But throughout, we have strived for excellence, for continuous improvement to support our residents and clients to live their best lives with dignity and fulfillment. Aged care is such important work. I understand this not only as a clinician, not only as a board director of Regis, but also as the primary carer of my mother, my father, and my beloved auntie, Meg. I pay particular tribute to our aged care workers at the front line. I admire, respect, and thank them for their tireless work, their commitment, and their absolute compassion 24 hours a day, seven days a week.
I seek re-election today as a director of Regis so that I can continue to make my contribution in an era where we are going to have growth, innovation, and shaping of the new future for aged care, and while also delivering value for our shareholders, who your support is actually supporting this very worthwhile enterprise. I thank my board colleagues, fond farewells to Bryan, who's taught me so much, and to Linda, to her amazing, excellent leadership team. Thank you.
Thank you. Thank you very much, Christine. Malcolm, are there any questions online regarding the re-election of Christine?
No questions for Christine.
Are there any questions in the room here regarding re-election of Christine? Okay. As there are no questions regarding the resolution, we'll proceed to the vote. The proxy position for this resolution will now be shown.
If you have not yet voted, please now select either for, against, or abstain for resolution 2.1. Okay. Thank you. Now we move to item 2.2, the election of Jodie Leonard as a director. The board, with Jodie abstaining, unanimously supports the election of Jodie Leonard as a director of the company. Jodie is unwell, recovering from COVID, and is attending online, and she prepared some notes for the meeting regarding her election, and I will read those out. Jodie offers herself for election as an independent non-executive director of Regis Healthcare. Jodie's involvement with Regis began in November 2023 when she was appointed to the board as an independent non-executive director and chair of the People and Remuneration Committee. Since joining Regis, she has taken the lead in revising the company's equity plan rules.
Additionally, she has proposed amendments to the terms and conditions of unvested performance rights, which are being submitted for approval at today's meeting. These changes will ensure a stronger long-term alignment between executives and shareholders. She also became a member of the Property Committee, which guides management in ensuring the property developments align with shareholder interests and meet the needs of our aged care residents, and will join the Clinical Governance Committee after today. Jodie brings to the board 30 years of commercial experience across a diverse range of industries, including healthcare, financial services, tourism, and technology. She has relevant experience in remuneration practices, marketing and customer experience, and digital innovation, governance, strategic planning, and executive management. Her diverse experience provides a unique lens to apply to aged care.
She has a genuine interest and passion for the sector, and after having the opportunity to visit many of Regis' homes in both Victoria and Interstate, recognizes the high quality of our homes. Jodie has been impressed by the leadership and the work of the team and the work the team undertakes every day to deliver services to our residents. Aged care is a calling, and it's one she's proud to be part of as she seeks election and your support to continue her contribution to the company and the aging community. Malcolm, are there any questions online regarding the election of Jodie?
No, Chairman. No questions for Jodie.
Are there any questions from the room? Okay. As there are no questions, I will now move to proceed to the vote. The proxy position for this resolution will now be shown. It's on the screen. If you have not yet voted, please now select either for, against, or abstain for resolution 2.2. Okay. I now turn to item three, the adoption of the remuneration report. The next item of business is item three, the adoption of the remuneration report for the financial year ending 30 June 2024.
This report was included in the directors' report on pages 65 to 78 of the company's annual report, which is available on the publications and presentations page of the company's website. This report sets out the company's remuneration arrangements for the CEO, CFO, and non-executive directors of the company. The vote for this resolution is advisory only and does not bind the company or directors. The resolution does, however, serve as an indication of shareholders' views regarding the company's remuneration practices, and the result will be taken into consideration by the board. Malcolm, are there any online questions regarding the remuneration report or policies or practices?
No online questions, Chairman.
Do we have any questions from the floor? No. As there are no questions at this matter, we'll now go to vote. So if you have not yet voted, please now select for, against, or abstain for resolution three. Okay. So we get to item four, which is the approval of Regis Healthcare Limited Equity Plan Rules. This next item of business on the agenda is to seek approval for all securities to be issued under the company's equity plan rules for a period of three years to be excluded from the 15% limit under the Listing Rule 7.1, the terms and conditions of which are set out in Annexure A to the notice of meeting.
The ASX listing rules prohibit a listed company from issuing more than 15% of its securities within any 12-month period without shareholder approval, with certain adjustments and exceptions. The maximum number of securities that may be issued under the equity plan rules within a three-year period from the date of this meeting is 5 million. Shareholders' approval of this resolution will give the company flexibility to raise funds over the next three years without equity plan issuances counting towards the 15% placement capacity limit. The directors, other than Dr. Mellors, who is the participant under the plan, support a vote in favor of this resolution. I will now take any questions you may have in relation to the equity plan rules.
There are no questions, Chairman.
Are there any questions from the floor? No. Okay. As there are no further questions, we'll now finalize discussion on this item. If you have not yet voted, please now select either for, against, or abstain for resolution four. The proxy position has been shown on the screen. The next item, item five, is the approval to amend terms and conditions of unvested performance rights. This resolution seeks shareholder approval for the company to vary the terms of performance rights that are on issue under an employer incentive scheme by changing the automatic exercise on vesting to a seven-year exercise period from the vesting date.
This amendment will permit executives to defer their personal taxing point as permitted under current taxation laws and support greater longer-term alignment of executives with shareholders. If the exercise period for these performance rights is not extended, employees may choose or be required to sell shares received on automatic exercise on vesting to meet their personal tax obligations.
As the relevant performance rights have an exercise price of nil, extending the exercise period will not result in an increase in the fair value of the rights or their accounting expense. The total number of performance rights affected is 2,221,040, which represents 0.74% of the company's undiluted issued capital. The company has received a waiver from the ASX to permit amendments proposed by this item of business. The varied terms and conditions are set out in the explanatory memorandum to the notice of meeting. The directors, other than Dr. Mellors, who is a participant under the plan, support a vote in favour of the resolution. I will now take any questions you may have in relation to the variation of performance rights terms.
There are no questions, Chairman.
Any questions from the floor? No. Okay. The proxy position for this resolution will now be shown on the screen. If you've not voted yet, please now select either for, against, or abstain for resolution five. Okay. Thank you. Item six, which is the approval of the FY2025 grant of performance rights to the Managing Director, Chief Executive Officer under LTI Plan. This agenda is to approve the grant of performance rights to Dr. Linda Mellors under the company's long-term incentive plan on the terms described in the notice of meeting.
The ASX listing rules require that shareholder approval be obtained for the acquisition of securities by a director under an employee incentive scheme. The board believes that this remuneration framework will appropriately reward Dr. Mellors as Managing Director and CEO and align her interests with those of our residents, clients, and shareholders.
In particular, the LTI Plan includes performance hurdles comprising an earnings per share component and Star Ratings components and is subject to a clawback or adjustment in the event of material misstatement or dishonesty. The Star Ratings are independently assessed and publicly available and a measure of Regis' performance against the four key categories comprising quality measures, compliance, resident experience, and staffing minutes.
These are all key drivers of Regis' reputation. These measures underpin the longer-term sustainability and reputation of the company. The LTI hurdles will need to be met by FY2027 for vesting of the performance rights to occur. Subject to shareholder approval, the resolution proposes that Dr. Mellors be granted 166,495 LTI performance rights. The directors, other than Dr. Mellors, support the vote in favour of this resolution. I'll now take any questions you may have in relation to the LTI grant.
Thank you, Chairman. We have a question from Stephen Mayne, directed to the CEO. Could the CEO please summarize her past LTI grants during her six years at the company as to whether they have vested or lapsed? Also, has she ever sold any ordinary shares in the company or bought any on market without relying on an incentive scheme to build her equity position in the company?
Thanks very much, Stephen. So I'm happy to answer that question. My initial shareholding in the company, I bought shares on market in early 2020. So I bought 158,000 shares at that point. Since then, I'm just adding up, since then, I've had 126,270 shares vest through our incentive arrangements. So in total, I have 284,270 shares. I haven't sold any shares since I've been with the company.
Thank you, Linda. And I guess just to provide a little bit more color on that, Stephen, the current LTI scheme, which has been in, I think, for two years, this is our second year, hasn't yet vested. So the vesting which Linda talked about was the previous scheme, which VRP scheme, which was changed following commentary by shareholders and proxy holders a couple of years ago. Are there any other questions?
No more questions.
So have we got questions from the floor? Yes, Peter.
I just wanted to comment that the LTI measures, one financial and the star rating. I just wondered, this is the second year that we've had the star rating. I don't know if it's actually been implemented, but can you just comment on how you feel the star rating is going as an appropriate measure for the LTI?
Thank you, Peter. Yeah, I'll make some comments and maybe Linda might want to talk a little bit about it as well. So the government introduced star ratings as a way of comparing all facilities, all homes in the aged care sector. So each home is independently assessed by the regulator and rated on those four categories that I talked about. So the categories were the quality measures. So quality measures meaning sort of clinical performance, compliance, compliance with the regulatory requirements of it, resident experience.
They actually do a survey of residents. And if the resident is unable to contribute, then it'll be the family who'd be asked questions. And then the staffing minutes, because this reinforces the need for care minutes, which are expected to increase as part of what the government funding's doing. So each aged care home is assessed. And for Regis, all of our homes are assessed. And then what we get is an average for Regis overall. And what we do in the LTI is compare our performance relative to 10 other large operators. So you can sort of see that in a relative sense how we're going. But we also look at it in an absolute sense that we're actually improving our performance on Star Ratings.
We've seen a modest increase in our own performance in Star Ratings in the last 12 months. So the Star Ratings have been in for, I think they were announced in December 2022 and have been implemented. So it's still fairly early days, but it is a very good and comparable and independent measure where we can show how our homes are performing relative to others across the sector.
And we also see it's aligned very much to the sort of core things that are both residents and the regulators looking for in terms of performance. So we think it's an effective measure. I think they're still developing aspects of that Star Ratings, but I think as a measure, the government's committed to it. And you might have recently seen advertising on the TV around Star Ratings as they encourage consumers to use it to help guide them as to which aged care home they might want to put loved ones into. So at this stage, I think we feel it's a good measure. It's a broad measure. It's very relevant to our sector. And it's very comparable for us relative to the other operators who we compete against. So from that point of view, we get good sort of comparability around how we've performed.
Did you want to add anything? Peter, the only thing that I would add is that the Aged Care Quality and Safety Commission is auditing very heavily in terms of the self-reported metrics. So there's a very heavy focus on auditing Care Minutes to make sure that providers are following the published rules, that they are reporting accurately. And also from a prudential compliance perspective, which contributes to our compliance ratings, they are having a very close look at those as well. So while some of these metrics are self-reported, there's a very strong audit process in place by the independent regulator.
Thanks, Linda. Do you have any other questions, Peter? No. Okay. Any other questions from the floor? Okay. Thank you. As there's no other questions, we'll now turn to the proxy position for this resolution being shown on the screen.
If you've not yet voted, please either vote for, against, or abstain for resolution five. Okay. So voting will close shortly, five minutes after the conclusion of the meeting. If you've not done so already, please ensure that you cast your votes on all resolutions. Ladies and gentlemen, that concludes the formal business of the meeting. The results of the final polls will be announced on the company's website and ASX announcement platform later today.
A recording of the meeting webcast will also be made available on our website. On behalf of the board, I'd like to thank you for your support and participation today. And I now declare the meeting closed, subject to the finalization of the polls. And I invite those present in the room to join directors and executives for a refreshment and thank those who've joined us online. Thank you very much.