Cyberattack causes $95 million loss for Demant

The Danish hearing aid manufacturer Demant has quickly piled up a $95 million bill associated with a cyber incident that struck the company in early September.

In a September 26 financial statement, the company revealed how the cyber incident that began on September 3 has impacted the company’s financial situation. Demant executives credited the quick action taken by the firm’s IT department in shutting down its network for containing the attack and limiting damage. Additionally, the fact the data was backed up is enabling the company to recover.

Demant has not stated what type of attack took place, but did note it was a victim of a cybercrime.

The recovery is expected to take another two-to-three weeks. Demant will focus its efforts on rebuilding inventory levels, which were depleted when it was forced to shut down production in the aftermath of the attack.

“Our current preliminary assessment indicates a total negative financial impact on EBIT in 2019 in the range of DKK 550-650 million [$80 million to $95 million], which includes the deduction of an expected insurance coverage of approx. DKK 100 million. This impact is predominately related to the estimated lost sales and weakening of growth momentum. Included in the financial impact, we expect to incur costs of DKK 50 million directly related to the incident,” the company said.

Demant’s losses, to date, are not as extreme as those suffered by shipping giant Maersk, which lost about $300 million, as did FedEx.

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