Regis Healthcare shares down 2% as CEO resigns

Shares in Regis Healthcare Ltd (ASX: REG) are down 2% after the aged care operator announced the resignation of Chief Executive Officer Dr Linda Mellors.

In an ASX release, Regis confirmed that Dr Mellors will step down after more than six years in the role, having decided to pursue an opportunity outside the aged care sector. She will remain in her position during a six-month notice period while the board conducts an executive search and manages a transition of responsibilities.

While leadership changes can prompt short-term uncertainty, today's share price reaction also needs to be viewed in the context of a volatile year for Regis investors.

A strong year with a sharp reversal

On the surface, Regis shares are still up about 20% year to date, having started the year around $6. However, that headline gain masks a much bumpier journey.

Earlier in 2025, optimism around Regis shares, powered by sector reform and operational improvements, drove the Regis share price up as much as 53%, peaking at $9.22. That rally came to an abrupt end on 22 September, when the company released a funding update outlining the impact of changes to government aged care funding models.

At the time, Regis revealed that increases under the Australian National Aged Care Classification (AN-ACC) framework would fall well short of expectations, largely due to reweighting across resident classifications. The announcement triggered a sharp reassessment by the market, with the share price falling around 35% back to $6, effectively wiping out the year's gains.

Why today's news matters

Against that backdrop, the resignation of the CEO introduces another layer of uncertainty. Dr Mellors led Regis through major industry upheavals, including the Royal Commission into Aged Care, the COVID-19 pandemic, and the rollout of the new Aged Care Act. The board acknowledged her role in stabilising and transforming the business, noting that Regis remains in a strong financial and operational position.

However, investors appear cautious about leadership change at a time when the company is still adjusting to funding pressures and wage cost increases across the sector.

What's next for Regis?

An executive search is now underway, and the company has emphasised continuity during the transition period. For shareholders, attention will likely return to how Regis navigates government funding reforms, manages labour costs, and delivers on its FY26 earnings outlook.

For now, the market reaction suggests investors are taking a "wait and see" approach, wary after September's funding shock, but still recognising the longer-term recovery story remains intact.

The post Regis Healthcare shares down 2% as CEO resigns appeared first on The Motley Fool Australia.

Motley Fool contributor Kevin Gandiya has no positions in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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