A Clare company devastated by a cyber attack is cutting staff after posting huge losses
Loyaltybuild suffered a major breach in late 2013 which forced it to stop trading for a period.
A CLARE-BASED COMPANY badly hit by a cyber attack four years ago has posted further multimillion-euro losses.
Loyaltybuild, which operates customer loyalty programmes for big companies, also said that while it will maintain its presence in Ireland, it plans to cut staff here.
Sales at the company dropped last year, falling from €30 million in 2016 to just under €26 million in 2015.
The firm made an operating loss of about €9 million, roughly in line with 2015. When everything was taken into account, Loyaltybuild made a full-year loss of €8.5 million, compared to a loss of €9.1 million the year before.
This brought accumulated losses at the businesses to almost €34 million. Despite a large drop in the number of people employed by the company, from 119 to 85, staff costs surged from €4.7 million to €6.8 million.
The bulk of the firm’s business came from European markets outside Ireland, with around one-fifth of its turnover generated in the Republic.
In the director’s report, Loyaltybuild said that it is changing its businesses model, becoming a “predominantly digital-led business” and will shed some of its Irish staff.
“The company must focus on becoming an agile, leaner business,” it said. “In addition, the company’s relationship with a significant client in Ireland terminated as of 31 December 2016.
“The company will maintain its presence in Ireland and operate with a reduced workforce.”
The company said its parent company, US group Affinion, would continue providing financial support for at least this year and that its restructuring was expected to cost around €795,000.
Cyber attack
Loyaltybuild is perhaps best known for being the victim of a major cyber attack in November 2013. The breach involved the personal data of 1.5 million people being exposed, including the full credit card details of 376,000 customers.
After the attack, the company was forced to stop trading for a period of time after it was hit with a prohibition order from the Data Protection Commissioner. Whoever was behind the cyber attack was never publicly identified.
Loyaltybuild was founded by some of Ireland’s best-known businessmen, including hotelier Sean Lyne and current Avolon chief executive Dómhnal Slattery. In 2008 they sold the firm to Affinion.
Loyaltybuild did not immediately respond to a request for comment from Fora.
