Britain’s Co-op Warns of $161 Million Profit Hit From Cyberattack
The Co-op Group, one of the UK’s most recognizable retailers, said on Thursday that a “sophisticated” cyberattack in April will reduce its annual profit by about £120 million ($161 million).
The 181-year-old, member-owned cooperative—which operates supermarkets, funeral services, legal, and insurance businesses—said it moved quickly to shut down several systems to contain the breach. That decision, however, caused major operational disruption, including shortages in food availability at stores.
The financial toll was clear in its latest results: for the first half of the year to July 5, revenue dropped by £206 million, while profit fell by £80 million. The company reported an underlying pre-tax loss of £75 million, compared with a £3 million profit a year earlier.
Finance chief Rachel Izzard said the full-year impact will total £120 million, with only limited insurance recovery. “We had the front-end elements of cyber insurance in place … but we don’t believe we will be claiming on insurance for back-end losses,” she explained.
Roughly £40 million of the second-half hit reflects new investments to strengthen cyber defenses. The Co-op’s Chief Digital and Information Officer, Rob Elsey, said attackers gained access through social engineering, impersonating a colleague to compromise their account—similar to a recent attack on Marks & Spencer.
The group’s food retail business, which generates the bulk of its revenue, slipped 1.6% to £3.6 billion, as it lost market share to rivals. Overall revenue was down 2.1% to £5.5 billion.
The company expects the rest of the year to bring continued pressure from high costs, global volatility, and intense competition, but still plans to open 30 new stores.
