British clothes company Marks and Spencer's profits plummet due to cyberattack

Marks and Spencer, the British clothes brand, said on Wednesday that a cyberattack that hit its online service resulted in the loss of profit for the group in the first half of the financial year.

Marks and Spencer's net profit plummeted 98 per cent to $8.1 million in the first six months of the financial year, the company said in a statement. The profit for the same time period last year was £282.1 million.

Marks and Spencer's online sale was halted for six weeks after cybercriminals stole customer data around Easter. The company's chief executive officer (CEO), Stuart Machin, said in a statement that the first half of the year was an "extraordinary moment in time" for Marks and Spencer.

"However, the underlying strength of our business and robust financial foundations gave us the resilience to face the challenge and deal with it," he added.

The group says that its second half will be profitable. It also said that the residual effects of the incident continue to reduce in the coming months.

The company said in May that the cyberattack could cost the company around £300 million. £101.6 million was spent on dealing with the issue. It is expected that £34 million in losses will be added to the cumulative loss in the second half of the financial year.

"Marks & Spencer has laid bare the full impact of a gruelling cyberattack on its earnings," noted Dan Coatsworth, head of markets at AJ Bell.

He said the profits plummeted because customers were not able to buy everything they wanted during the summer.

It is the second massive cyber attack in the UK this year. The manufacturing in Britain-based carmaker Jaguar Land Rover had stopped for several weeks after a cyber attack. The attack also impacted companies in the carmaker's supply chain. Manufacturing resumed last month.