Morgan Advanced Materials slashes its fiscal year profits following cyberattack

The UK-based Manufacturing company Morgan Advanced Materials expects a 10-15% yearly operating profits plummet in the aftermath of a January cyberattack that could cost it millions to handle.

Morgan Advanced Materials detected unauthorized access to its systems on January 10, leaving it up to the manual processing of transactions at various sites.

Although the company is still in the process of restoring its systems, it announced that some of them will remain irrecoverable. Instead, it is working on implementing a new “cloud-based ERP solution at the affected sites.”

According to the statement, it could cost the company up to £12 million (approximately $14,362,740) to deal with the incident, forcing it to slash its yearly operating profits forecasts. The fees are associated with recovering systems and covering specialists. Despite that, Morgan Advanced Materials is not expecting any long-term impacts.

“During January, a number of sites experienced a delay in restarting production and shipping due to the cybersecurity incident.

"Whilst demand has remained strong during January, we are experiencing production inefficiency during the recovery period which, based on current estimates, could lead to adjusted operating profit for FY2023 being approximately 10% to 15% below our previous expectations," the company said.

Morgan Advanced Materials also called it “challenging” to estimate the impact on its interim trading as certain sites had to manage delays in restarting production and shipping following the attack.

The last couple of months have been hectic for UK companies, as many – including the Royal Mail, JD Sports, the City of London, and Vesuvius – fell victim to cyberattacks.