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Lease

12 Months Ended

Dec. 31, 2024

Presentation of leases for lessee [abstract]

24.

Leases

Company as a lessee

(1)	Lease contracts

The Company applies the short-term leases recognition exemption to its lease contracts that have a lease term of 12 months or less from the commencement date, and recognized ￦172,711 million and ￦152,644 million respectively, as expense for the years ended December 31, 2023 and 2024. The Company also applies the leases of

low-value

assets recognition exemption to leases contracts with underlying assets considered to be low value (i.e., approximately less than ￦5 million), and recognized ￦4,659 million and ￦3,121 million respectively, as expense for the years ended December 31, 2023 and 2024. The Company has lease contracts for various items such as consecutive voyage charter contracts, power purchase agreements (PPA), real estate lease contracts including buildings, switchyard, and land for electric substation, vehicles, and other equipment.

(2)	Right-of-use assets as of December 31, 2023 and 2024 are as follows:


		2023
		Acquisition cost		Accumulated depreciation			Book value

		In millions of won
Land	￦		937,481		(281,621	)		655,860
Buildings			188,017		(97,444	)		90,573
Structures			46,573		(9,217	)		37,356
Machinery			26,453		(20,510	)		5,943
Ships			4,137,168		(1,823,863	)		2,313,305
Vehicles			59,208		(33,717	)		25,491
Others (*)			646,894		(411,679	)		235,215

	￦		6,041,794		(2,678,051	)		3,363,743

(*)

Including a power purchase agreement (“PPA”) with CGN Yulchon Generation Co., Ltd.


		2024
		Acquisition Cost		Accumulated depreciation			Book value

		In millions of won
Land	￦		1,017,114		(339,512	)		677,602
Buildings			214,258		(108,417	)		105,841
Structures			52,983		(12,124	)		40,859
Machinery			54,654		(27,594	)		27,060
Ships			3,946,265		(2,015,172	)		1,931,093
Vehicles			59,402		(38,482	)		20,920
Others (*)			686,400		(443,379	)		243,021

	￦		6,031,076		(2,984,680	)		3,046,396

(*)

Including a power purchase agreement (“PPA”) with CGN Yulchon Generation Co., Ltd.

(3)	Changes in right-of-use assets for the years ended December 31, 2023 and 2024 are as follows:


		2023
		Beginning balance		Increase		Depreciation			Decrease			Others			Ending balance

		In millions of won
Land	￦		661,799		2,696		(57,461	)		(126	)		48,952			655,860
Buildings			74,856		24,622		(32,591	)		(904	)		24,590			90,573
Structures			23,965		49		(2,471	)		(273	)		16,086			37,356
Machinery			835		—		(94	)		—			5,202			5,943
Ships			2,596,863		199,538		(382,298	)		—			(100,798	)		2,313,305
Vehicles			14,716		21,097		(10,464	)		(1,008	)		1,150			25,491
Others			338,091		13,860		(51,138	)		(302	)		(65,296	)		235,215

	￦		3,711,125		261,862		(536,517	)		(2,613	)		(70,114	)		3,363,743


		2024
		Beginning balance		Increase		Depreciation			Decrease			Others			Ending balance

		In millions of won
Land	￦		655,860		12,369		(65,245	)		(117	)		74,735			677,602
Buildings			90,573		61,397		(48,371	)		(399	)		2,641			105,841
Structures			37,356		4,115		(4,595	)		—			3,983			40,859
Machinery			5,943		26,200		(7,083	)		—			2,000			27,060
Ships			2,313,305		—		(363,032	)		(1,656	)		(17,524	)		1,931,093
Vehicles			25,491		11,042		(14,167	)		(77	)		(1,369	)		20,920
Others			235,215		17,372		(36,502	)		(3	)		26,939			243,021

	￦		3,363,743		132,495		(538,995	)		(2,252	)		91,405			3,046,396

(4)	Lease liabilities as of December 31, 2023 and 2024 are as follows:


		2023			2024
		In millions of won
Less than 1 year	￦		641,525			632,878
1 ~ 5 years			1,898,845			1,817,340
More than 5 years			1,694,730			1,670,416

			4,235,100			4,120,634
Less: Discount			(427,220	)		(421,178	)

Present value of lease payment	￦		3,807,880			3,699,456

(5)	The details of the liquidity classification of lease liabilities as of December 31, 2023 and 2024 are as follows:


		2023		2024
		In millions of won
Current lease liabilities	￦		612,765		603,492
Non-current lease liabilities			3,195,115		3,095,964

	￦		3,807,880		3,699,456

(6)	Changes in lease liabilities for the years ended December 31, 2023 and 2024 are as follows:


		2023
		Beginning balance		Increase		Decrease			Interest expenses		Others (*)			Ending balance
		In millions of won
Lease liabilities	￦		4,163,143		253,495		(661,665	)		87,426		(34,519	)		3,807,880

(*)

Including translation effect of foreign currency lease liabilities and others.


		2024
		Beginning balance		Increase		Decrease			Interest expenses		Others (*)		Ending balance
		In millions of won
Lease liabilities	￦		3,807,880		119,161		(695,466	)		82,638		385,243		3,699,456

(*)

Including translation effect of foreign currency lease liabilities and others.

(7)	Details of expense relating to lease contracts as lessee for the years ended December 31, 2023 and 2024 are as follows:


		2023		2024
		In millions of won
Depreciation of right-of-use assets	￦		536,517		538,995
Interest expenses of lease liabilities			87,426		82,638
Leases expenses for short-term leases			172,711		152,644
Leases expenses for leases of low-value assets			4,659		3,121
Variable lease payments			62,006		12,420

	￦		863,319		789,818

(8)	The total cash outflow related to the lease contracts, including cash outflows due to short-term leases and leases of low-value assets, amounts to ￦ 901,041 million and ￦ 863,651 million, for the years ended December 31, 2023 and 2024, respectively.

Company as a lessor

(1)	Finance lease contracts

The Company entered into power purchase agreements (“PPA”) with Jordan Electric Power Company to provide a 373MW level Qatrana gas combined power plant over a

25-year

lease term, and an 89.1MW level Fujeij wind power plant over a

20-year

lease term. In addition, the Company provides

energy storage system installation projects and

238

energy efficiency contracts as finance leases with a lease term of 2 to 11 years. Also, the Company entered into a PPA with the Comission Federal de Electricidad in Mexico to provide for 25 years (from December 2013 to November 2038) all electricity generated from the power plant after completion of its construction and collect rates consisting of fixed costs (to recover the capital) and variable costs during the contracted period.

(2)	Profit and loss related to finance lease for the years ended December 31, 2023 and 2024 are as follows:


		2023		2024
		In millions of won
Finance income on the net investment in the lease	￦		118,695		120,770

(3)	Maturity analysis of the lease payments receivable and reconciliation of the undiscounted lease payments to the net investment in the lease as of December 31, 2023 and 2024 are as follows:


		2023			2024
		In millions of won
Less than 1 year	￦		189,779			213,300
1 ~ 2 years			182,743			217,747
2 ~ 3 years			179,428			204,867
3 ~ 4 years			178,074			193,379
4 ~ 5 years			168,221			184,436
More than 5 years			1,408,350			1,420,807

			2,306,595			2,434,536
Less: Unearned finance income			(1,057,434	)		(1,078,138	)

Net investment in the lease (*)	￦		1,249,161			1,356,398

(*)

Including the present value of unguaranteed residual value amounting to ￦25,521 million and ￦31,857 million, as of December 31, 2023 and 2024, respectively.

The implicit interest rate for a lease term is determined on the lease contract date. The implicit interest rate of the finance lease contracts is from 0.00% up to 17.15% per year as of December 31, 2024. (prior year : 0.00% ~ 17.03%)

(4)	Changes in the allowance for doubtful accounts of finance lease receivables for the years ended December 31, 2023 and 2024 are as follows:


		2023		2024
		In millions of won
Beginning balance	￦		4,505		5,256
Bad debt expense			751		—
Reversal			—		(1	)

Ending balance	￦		5,256		5,255