Cash Generated from Operations (Tables)

12 Months Ended

Dec. 31, 2018

Summary of Cash Flows from Operating Activities

Cash flows from operating activities for the years ended December 31, 2016, 2017 and 2018, are as follows:


(In millions of Korean won)	2016			2017			2018
1. Profit for the year	￦	831,845		￦	546,341		￦	719,412
2. Adjustments to reconcile net income
Income tax expense		334,910			270,656			314,565
Interest income¹		(130,066	)		(108,639	)		(265,817	)
Interest expense¹		337,219			302,464			296,894
Dividends income		(3,926	)		(4,785	)		(2,910	)
Depreciation		2,821,779			2,802,531			2,735,413
Amortization of intangible assets		599,721			635,150			629,526
Provision for severance benefits		217,255			218,966			245,926
Impairment losses on trade receivables		92,711			45,704			113,064
Share of net profit or loss of associates and joint ventures		(2,547	)		15,480			5,912
Loss(gain) on disposal of associates and joint ventures		(1,450	)		979			(3,737	)
Impairment loss of associates and joint ventures		17,128			3,662			—
Loss on disposal of property and equipment and investment in properties		74,913			150,293			68,688
Loss(gain) on disposal of intangible assets		7,703			4,271			(4,256	)
Loss on impairment of intangible assets		135,264			116,095			12,997


(In millions of Korean won)	2016			2017			2018
Loss on foreign currency translation		109,784			(213,341	)		68,952
Loss(gain) on valuation and settlement of derivatives, net		(117,181	)		268,094			(92,210	)
Gain on disposal of financial assets at fair value through profit or loss		—			—			(1,712	)
Gain on valuation of financial assets at fair value through profit or loss		—			—			(10,768	)
Gain on disposal of financial assets at amortized cost		—			—			(44	)
Impairment losses on available-for-sale financial assets		966			9			—
Gain on disposal of available-for-sale financial assets		(22,695	)		(89,598	)		—
Others		64,863			(251,193	)		(55,969	)
3. Changes in operating assets and liabilities
Decrease(increase) in trade receivables		216,818			(303,340	)		(81,217	)
Decrease(increase) in other receivables		(779,803	)		(346,013	)		356,643
Decrease(increase) in other current assets		48,549			11,792			(123,258	)
Decrease(increase) in other non-current assets		(51,765	)		(43,790	)		19,556
Decrease(increase) in inventories		167,873			(205,403	)		(480,543	)
Increase(decrease) in trade payables		(114,838	)		162,110			(167,841	)
Increase(decrease) in other payables		706,771			214,689			(448,301	)
Increase in other current liabilities		37,798			288,553			291,548
Increase in other non-current liabilities		30,762			174,618			144,072
Decrease(Increase) in provisions		(12,583	)		(12,574	)		85,946
Decrease(Increase) in deferred revenue		(69,179	)		(13,086	)		48,201
Increase in plan assets		(224,244	)		(203,420	)		(53,301	)
Payment of severance benefits		(121,835	)		(118,391	)		(153,209	)

4. Cash generated from operations (1+2+3)	￦	5,202,520		￦	4,318,884		￦	4,212,222

BC Card Co., Ltd. and other subsidiaries of the Group recognized interest income and expenses as operating income and expenses, respectively. Related interest income recognized as operating revenue is ￦21,021 million (2017: ￦15,561 million) and related interest expense recognized as operating expense is ￦21 million (2017: zero) for the year ended December 31, 2018.

Summary of Significant Transactions not Affecting Cash Flows

Significant transactions not affecting cash flows for the years ended December 31, 2016, 2017 and 2018, are as follows:


(In millions of Korean won)	2016			2017			2018
Reclassification of the current portion of borrowings	￦	1,617,175		￦	1,416,066		￦	1,149,599
Reclassification of construction-in-progress to property and equipment		2,212,324			2,686,591			1,988,014
Reclassification of accounts payable from property and equipment		91,407			225,601			122,185
Reclassification of accounts payable from intangible assets		668,564			(227,108	)		584,595
Reclassification of payable from defined benefit liability		5,746			36,209			(31,838	)
Reclassification of payable from plan assets		(9,731	)		43,035			(9,497	)