M&S to take £300 million hit from cyber attack – Daily Business

Marks & Spencer said the devastating cyberattack that saw it struggle to maintain online operations will cost it an estimated £300 million.

The figure overshadowed adusted pre-tax profits for the year to the 29 March which rose by a better-than-expected 22% to £875.5m from £716.4m in the previous 12 months. It was the highest profit haul in 15 years.

The board proposes a 20% full year dividend increase to 3.6p.

The retailer said the expected financial impact of the cyber attack would be mitigated by insurance and other actions.

The attack forced M&S to halt orders via its website, while deliveries of food and fashion into stores and some deliveries to its online food partner, Ocado, have also been disrupted.

M&S has also admitted that some personal information relating to thousands of customers – including names, addresses, dates of birth and order histories – was taken in the cyber-attack, though bank details were not taken.

Today the company said it entered the new financial year with strong trading momentum, with both Food and Fashion, Home & Beauty trading ahead of budget.

“Over the last few weeks, we have been managing a highly sophisticated cyber incident. As a team, we have worked around the clock with suppliers and partners to contain the incident and stabilise operations, taking proactive measures to minimise the disruption for customers.

“We are focused on recovery, restoring our systems, operations and customer proposition over the rest of the first half, with the aim of exiting this period a much stronger business.

“Since the incident, Food sales have been impacted by reduced availability, although this is already improving. We have also incurred additional waste and logistics costs, due to the need to operate manual processes, impacting profit in the first quarter.

“In Fashion, Home & Beauty, online sales and trading profit have been heavily impacted by the necessary decision to pause online shopping, however stores have remained resilient. We expect online disruption to continue throughout June and into July as we restart, then ramp up operations. This will also mean increased stock management costs in the second quarter.

“Therefore, our current estimate before mitigation is an impact on Group operating profit of around £300m for 2025/26, which will be reduced through management of costs, insurance and other trading actions. It is expected that costs directly relating to the incident will be presented separately as an adjusting item.

“Overall, our strategy remains the same and there is no change to our longer-term plans to reshape M&S for growth.

“We are confident that we will enter the second half with a strong customer proposition, returning to the performance we were delivering immediately prior to the incident and throughout 2024/25, which is outlined in the following sections.”

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