Australian Consumer Lending Company Latitude Group reported a pure loss of $98.2 million in the first half of 2023. The reason for this significant loss was a cyber attack in March, during which the attackers managed to steal nearly 8 million driver’s licenses and millions of other confidential customer documents.
This loss is in stark contrast to the net profit of $30 million reported during the same period last year. The costs directly associated with the cyber attack amounted to approximately $76 million for Latitude.
As a result of the cyber attack, Latitude had to suspend operations for five weeks, affecting their ability to issue new loans and recover debts on existing loans. This immediately impacted the company’s performance.
Lending volumes in the cash loan segment in Australia and New Zealand decreased significantly by 19%. In addition to the cyber attack, high inflation, reduced consumer income, and a slowdown in retail sales also contributed to the decline in results.
When comparing this year’s results with the previous year, taking into account the expenses incurred due to the cyber attack, it can be assumed that the company may have incurred a loss even without the incident, but the hackers significantly worsened the situation.
In a recent statement, CEO Bob Belan acknowledged that the first half of this year has been one of the most challenging periods in Latitude’s history. However, he expressed pride in the team’s resilience and satisfaction with the pace of business recovery.
Belan stated that Latitude will continue to prioritize strengthening cybersecurity and improving customer service, with a focus on the key areas of lending and money transfers.
Despite the current difficulties, Latitude reaffirmed its previous forecast of a net profit ranging from $15-25 million for the entire year of 2023. This indicates the leadership’s confidence in the imminent recovery of the business.
A positive trend is observed in the premium credit card segment. The demand for Latitude 28° Global Platinum MasterCard has increased by 29% due to the resumption of international travel. The volume of this product has reached $1 billion, aligning with pre-pandemic levels.
During the first half of the year, the company has established partnerships with several new retail chains and is actively pursuing agreements with other major retailers. The sale