By Amber Murray

Copyright cityam

The Co-operative Group has revealed an £80m hit to half-year profit after a damaging cyber attack earlier this year.

The retail and funerals specialist said that it had slumped to a loss in the first half of 2025 after being targeted by a “malicious” cyber attack.

Shoppers were faced with empty shelves and issues with payments during the fallout from the cyber incident in April, as a raft of retailers were hit.

The company shut off parts of its IT systems after the attack, in which hackers accessed and extracted members’ personal data.

Sales in the first half fell by 2.1 per cent due to the attack, the Co-op said. However, the company assured markets that sales rose 1.5 per cent excluding the impact of the attack.

Debbie White, the chair of Co-op, said that the attack brought “significant challenges” to the business.

“Our balance sheet strength and the magnificent response of our 53,000 colleagues enabled us to maintain vital services for our members and their communities.

“We must now build our Co-op back better and stronger to meet the challenges and opportunities that lie ahead,” White said.

Spencer Young, analyst at Delinea, said that the news “underscores the scale of disruption that identity-based attacks can have.”

“Despite growing awareness, attackers continue to exploit weaknesses in identity and credentials to infiltrate IT systems, disrupt operations, and even compromise customer data. The financial and reputational impact is a stark reminder that cyber resilience now depends on prioritising identity security,” he added.

Cost headwinds hit Co-op

The cyber attack wasn’t the only pressure the Co-op faced in the first half of 2025.

The company noted that profitability was also impacted by significant cost headwinds, including Real Living Wage and National Insurance increases and new Extended Producer Responsibility charges.

“The most significant effects of these headwinds have been felt in the first half of the year; longer-term, offsetting mitigations are underway,” the company said.

Higher national insurance payments came into effect in April after being announced in last year’s Budget.

Chief executive, Shirine Khoury-Haq, added that Co-op is “stronger and more resilient” than in the past, and “better able to navigate the headwinds that all businesses are facing”.

“The cyber attack highlighted many of our strengths. But more importantly, it also highlighted areas we need to focus on – particularly in our food business.

“We’ve already started on this journey, refining our member and customer proposition, making structural changes to our business, and setting our Co-op up for long-term success.”