XML 31 R21.htm IDEA: XBRL DOCUMENT

Property, Plant and Equipment, Net

12 Months Ended

Dec. 31, 2025

14.	Property, Plant and Equipment

(a)	Property, plant and equipment as of December 31, 2024 and 2025 are as follows:


(in millions of Won)	2024										2025
	Acquisition cost		Accumulated depreciation and impairment loss			Government grants			Book value		Acquisition cost		Accumulated depreciation and impairment loss			Government grants			Book value
Land	￦	3,353,019		(12,144	)		(5,000	)		3,335,875		3,700,385		(8,261	)		(5,738	)		3,686,386
Buildings		12,097,246		(6,808,735	)		(7,543	)		5,280,968		12,970,144		(7,164,018	)		(12,286	)		5,793,840
Structures		8,292,323		(4,431,766	)		(34	)		3,860,523		9,030,274		(4,739,870	)		(31	)		4,290,373
Machinery and equipment		58,845,673		(40,516,816	)		(17,179	)		18,311,678		60,640,317		(42,410,343	)		(24,647	)		18,205,327
Vehicles		433,218		(340,993	)		(2,250	)		89,975		502,658		(400,506	)		(1,537	)		100,615
Tools		609,799		(474,877	)		(421	)		134,501		623,466		(504,974	)		(235	)		118,257
Furniture and fixtures		911,525		(711,472	)		(20	)		200,033		993,990		(774,780	)		(42	)		219,168
Right of use assets		1,589,388		(618,754	)		—			970,634		2,071,107		(696,780	)		—			1,374,327
Bearer plants		203,433		(63,982	)		—			139,451		588,892		(226,021	)		—			362,871
Construction-in-progress		7,744,779		(180,824	)		(40,765	)		7,523,190		8,399,751		(207,727	)		(50,368	)		8,141,656

	￦	94,080,403		(54,160,363	)		(73,212	)		39,846,828		99,520,984		(57,133,280	)		(94,884	)		42,292,820

(b)	Changes in the carrying amount of property, plant and equipment for the years ended December 31, 2024 and 2025 were as follows:

For the year ended December 31, 2024


(in millions of Won)	Beginning		Acquisitions		Disposals			Depreciation			Impairment loss(*2,3)			Others(*1)			Ending
Land	￦	3,290,244		20,523		(6,061	)		—			(6,620	)		37,789			3,335,875
Buildings		4,427,632		14,002		(11,137	)		(346,334	)		(67,797	)		1,264,602			5,280,968
Structures		3,081,524		11,663		(4,497	)		(306,017	)		(15,328	)		1,093,178			3,860,523
Machinery and equipment		16,539,192		179,457		(47,511	)		(2,484,915	)		(385,367	)		4,510,822			18,311,678
Vehicles		79,595		17,353		(1,487	)		(39,263	)		(56	)		33,833			89,975
Tools		128,865		28,731		(673	)		(54,966	)		(1,573	)		34,117			134,501
Furniture and fixtures		189,887		27,966		(2,380	)		(70,561	)		(3,260	)		58,381			200,033
Right of use assets		998,305		132,219		(18,706	)		(177,475	)		(1,994	)		38,285			970,634
Bearer plants		137,331		—		(27	)		(9,602	)		—			11,749			139,451
Construction-in-progress		6,333,673		7,634,826		(3,482	)		—			(128,119	)		(6,313,708	)		7,523,190

	￦	35,206,248		8,066,740		(95,961)			(3,489,133	)		(610,114	)		769,048			39,846,828

(*1)	Represents assets transferred from construction-in-progress to intangible assets and other property, plant and equipment, reclassifications resulting from change in purpose of use, adjustments of foreign currency translation differences and others.

(*2)

The Company calculated the net fair value of individual assets, such as steelmaking plant no. 1 and blast furnace no. 4 in Pohang, whose operation was suspended due to operation plan changes, to estimate recoverable amount and recognized an impairment loss of

￦

227,239 million for property, plant and equipment during the year ended December 31, 2024.

(*3)

The Company identified certain portion of the anode/cathode material assets that were in long-term idle status or expected to fall short of the anticipated economic performance during the year ended December 31, 2024. The Company calculated the net fair value of such individual assets to estimate the recoverable amount and recognized an impairment loss of

￦

307,911 million for assets that the recoverable amounts are less than their carrying amounts.

For the year ended December 31, 2025


(in millions of Won)	Beginning		Acquisitions		Business combination(*1)		Disposals			Depreciation			Impairment loss(*2)			Others(*3)			Ending
Land	￦	3,335,875		33,702		218,786		(13,247	)		—			(1,364	)		112,634			3,686,386
Buildings		5,280,968		28,996		62,944		(35,868	)		(403,394	)		—			860,194			5,793,840
Structures		3,860,523		13,591		10,796		(103,544	)		(330,278	)		—			839,285			4,290,373
Machinery and equipment		18,311,678		107,319		23,146		(43,106	)		(2,543,786	)		(88,769	)		2,438,845			18,205,327
Vehicles		89,975		9,538		19,921		(1,463	)		(40,783	)		(1,344	)		24,771			100,615
Tools		134,501		23,288		—		(1,850	)		(53,854	)		(1	)		16,173			118,257
Furniture and fixtures		200,033		30,487		4,818		(3,466	)		(79,619	)		—			66,915			219,168
Right of use assets		970,634		644,892		—		(43,705	)		(202,668	)		—			5,174			1,374,327
Bearer plants		139,451		—		249,352		(4,647	)		(11,229	)		—			(10,056	)		362,871
Construction-in-progress		7,523,190		5,176,786		44,872		(8,941	)		—			(44,175	)		(4,550,076	)		8,141,656

	￦	39,846,828		6,068,599		634,635		(259,837)			(3,665,611	)		(135,653	)		(196,141	)		42,292,820

(*1)	For the year ended December 31, 2025, as entities such as PT. Prime Agri Resources were consolidated as subsidiaries, the Company included the resulting increase in property, plant and equipment in business combination.

(*2)	For the year ended December 31, 2025, the Company estimated the recoverable amount of individual assets whose operation was suspended, such as Finex Plant no. 3, at their net fair value and recognized an impairment loss of ￦ 69,988 million.

(*3)	Represents assets transferred from construction-in-progress to intangible assets and other property, plant and equipment, reclassifications resulting from change in purpose of use, adjustments of foreign currency translation differences and others.

(c)	Borrowing costs capitalized and the capitalized interest rate for the years ended December 31, 2023, 2024 and 2025 were as follows:


(in millions of Won)	2023		2024		2025
Weighted average expenditure	￦	3,585,047		4,016,832		3,740,288
Borrowing costs capitalized		126,260		193,093		148,383
Capitalization rate (%)		1.53 ~ 6.91		0.70 ~ 5.78		1.11 ~ 8.04

(d)	Property, plant and equipment and investment property pledged as collateral as of December 31, 2024 and 2025 are as follows:


(in millions of Won)		Book value
	Collateral right holder	2024		2025
Land	Korean Development Bank and others	￦	846,211		765,038
Buildings and structures	Korean Development Bank and others		1,303,216		1,275,029
Machinery and equipment	Korean Development Bank and others		1,828,174		2,319,098
Other property, plant and equipment	Korean Development Bank and others		34,614		650,904

		￦	4,012,215		5,010,069

As of December 31, 2025, assets pledged as collateral related to the Company’s borrowings and others amounting to

￦

5,320,753 million include investment properties and other assets such as right to use land.

(e)	Changes in the carrying amount of right of use assets presented as investment property and property, plant and equipment for the years ended December 31, 2024 and 2025 were as follows:

For the year ended December 31, 2024


(in millions of Won)	Beginning		Acquisitions		Depreciation			Impairment loss			Others			Ending
Land	￦	363,789		1,542		(17,501	)		(1,994	)		3,082			348,918
Buildings and structures		151,366		58,116		(54,092	)		—			(643	)		154,747
Machinery and equipment		355,604		37,204		(47,797	)		—			1,631			346,642
Vehicles		48,228		12,501		(20,291	)		—			4,633			45,071
Ships		220,754		—		(24,684	)		—			—			196,070
Others		29,895		22,856		(19,657	)		—			(9,068	)		24,026

	￦	1,169,636		132,219		(184,022	)		(1,994	)		(365	)		1,115,474

For the year ended December 31, 2025


(in millions of Won)	Beginning		Acquisitions		Depreciation			Others			Ending
Land	￦	348,918		15,560		(16,154	)		(22,092	)		326,232
Buildings and structures		154,747		119,586		(55,532	)		(25,018	)		193,783
Machinery and equipment		346,642		29,687		(64,748	)		20,540			332,121
Vehicles		45,071		15,832		(21,623	)		1,489			40,769
Ships		196,070		264,508		(33,792	)		—			426,786
Others		24,026		201,183		(16,440	)		(10,929	)		197,840

	￦	1,115,474		646,356		(208,289	)		(36,010	)		1,517,531

(f)	The amount recognized in profit or loss related to leases for the years ended December 31, 2023, 2024 and 2025 were as follows:


(in millions of Won)	2023		2024		2025
Interest on lease liabilities	￦	41,109		48,887		63,586
Expenses related to short-term leases		52,486		53,944		38,639
Expenses related to leases of low-value assets		20,103		25,968		19,346

	￦	113,698		128,799		121,571