Pan-European discount variety retailer Pepco Group has disclosed a significant financial loss following a “sophisticated fraudulent” phishing attack on its Hungarian business.  

The incident led to a cash loss of €15.5m ($16.7m) before any possible efforts for recovery.  

The company is working with banking partners and law enforcement to recover the funds, although the outcome remains uncertain at this stage. 

The attack did not compromise any customer, supplier or colleague information or data.

Pepco has taken immediate action to address the situation, including a thorough investigation and measures to re-inforce its group-wide IT and financial control environment.  

The company is committed to enhancing its policies and procedures to prevent future incidents. 

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The retailer has emphasised the strength of its balance sheet, highlighting more than €400m in available liquidity from cash and credit facilities.  

Pepco continues to generate strong cash flow from its operations despite the incident. 

The company’s commitment to financial controls and IT security is underscored by a group-wide review of all systems and processes.  

This review aims to fortify the business against similar threats in the future. The company will provide updates on the situation as they become available. 

The group operates 248 Pepco stores in Hungary and reported that its first-quarter total group revenue grew 11% to €1.9bn in fiscal 2024. 

The European discount retailer recently announced its decision to discontinue operations in the Austrian market.