Financial impact of LandMark White cyber attack revealed
Written on the 6 May 2019 by Business News Australia
The data beach of listed property valuation group LandMark White has hurt the company's revenue by up to $7 million.
The company has revealed today the full extent of the breach on the group's bottom line, plus the significant cost of making sure this type of cyber-attack does not happen again.
The company says the breach, which led to the company being suspended from the Big Four bank panels for property valuations, has resulted in a loss of revenue of approximately $5-6 million. Approximately a further $1 million of revenue is likely to be lost between now and the date of full reinstatement by the remaining financial institutions.
This loss of revenue does not account for the "significant" cost of upgrading the group's cyber security measures. The company says it is returning with a system with significantly enhanced digital security measures, and it is working towards achieving ISO27001 (International Information Security Standard) certification in the meantime.
The company says its new cyber security measures will incur higher costs going forward, but that they are "critical" to protecting company data.
The breach appears to have significantly affected the company's bottom line for 1H19, with profit after tax skydiving down 92.1 per cent or $1.88 million to $162,000.
LandMark White has now been reinstated as a panel valuer by three of the four major banks, and expects to be reinstated by the final one soon.
Ultimately, the company has been hit hard by the data breach. Previously LandMark White offered guidance of full year profit hitting around $2.8 million. Now, the company expects to report a full year loss of $2.3 million.
The valuer expects to return to normal levels of revenue and profit in FY2020.
LandMark White chairman Keith Perret says all staff pulled together to get through this difficult period.
"I would like to thank our loyal staff who have remained with LMW over this extremely difficult period, a time where the integration of LMW and Taylor Byrne has continued and developed into a cohesive group working to ensure LMW has the capacity to provide our clients with the best possible service with property valuations and advice to our clients," says Perret.
"I would also like to thank Timothy Rabbitt, ex CEO of Taylor Byrne, who stepped in as LMW's Acting CEO at this most difficult time."
"I look forward to the normalisation of revenue streams after this incident and particularly the opportunity that has stemmed from our building a more robust security framework which has put LMW in a good position to develop and seize further growth opportunities."
The company is set to return to being traded on the ASX tomorrow morning after nearly three months of suspension following the data breach revelation.
The data breach saw approximately 137,500 unique records and approximately 1,680 supporting documents were accessed.
The breached dataset contained property valuation and some personal contact information of borrowers, lenders, homeowners, residents, and property agents.
This data remained up on the dark web accessible by anyone for 10 days.
"Had we been aware of the full extent of the incident any sooner we would have immediately shut down access to the exposed programming interface. We sincerely regret that we did not act sooner and accept full responsibly for not having done so," said LandMark White at the time.
Business News Australia
Author: Business News Australia