Financial Risk Management (Tables)

12 Months Ended

Dec. 31, 2023

Financial Risk Management [Line Items]

Exposure to currency risk

The Group’s exposure to foreign currency risk based on notional amounts as of December 31, 2022 and 2023 are as follows:

(In millions)	December 31, 2022
	USD			JPY			CNY			TWD			EUR			PLN		VND
Cash and cash equivalents		1,040			228			1,984			25			1			1		151,912
Deposits in banks		69			—			8,888			—			—			—		—
Trade accounts and notes    receivable		1,725			103			703			—			—			—		—
Other accounts receivables		26			114			253			10			21			—		15,800
Other assets denominated in foreign    currencies		30			191			82			7			—			—		11,353
Trade accounts and notes payable		(1,824	)		(4,987	)		(1,306	)		—			—			—		(478,926	)
Other accounts payable		(565	)		(19,084	)		(1,711	)		(8	)		(10	)		—		(2,681,508	)
Financial liabilities		(4,846	)		—			(20,569	)		—			—			—		—
		(4,345	)		(23,435	)		(11,676	)		34			12			1		(2,981,369	)
Cross currency interest rate swap    contracts (*)		2,430			—			—			—			—			—		—
Net exposure		(1,915	)		(23,435	)		(11,676	)		34			12			1		(2,981,369	)

(In millions)	December 31, 2023
	USD			JPY			CNY			TWD			EUR			PLN		VND
Cash and cash equivalents		1,074			654			1,695			38			2			1		226,342
Deposits in banks		—			—			7,411			—			—			—		—
Trade accounts and notes    receivable		2,442			—			430			—			(2	)		—		—
Other accounts receivables		6			186			294			20			—			—		13,969
Other assets denominated in foreign    currencies		23			188			34			7			—			—		13,146
Trade accounts and notes payable		(1,721	)		(9,837	)		(1,765	)		—			2			—		(740,674	)
Other accounts payable		(545	)		(14,589	)		(2,151	)		(6	)		(5	)		—		(1,309,118	)
Financial liabilities		(4,068	)		—			(25,336	)		—			—			—		—
Advances received		(1,200	)		—			—			—			—			—		—
		(3,989	)		(23,398	)		(19,388	)		59			(3	)		1		(1,796,335	)
Cross currency interest rate swap    contracts(*1)		1,930			—			345			—			—			—		—
Forward exchange    contracts(*2)		1,200			—			—			—			—			—		—
Net exposure		(859	)		(23,398	)		(19,043	)		59			(3	)		1		(1,796,335	)

Average Exchange Rates Applied during Reporting Periods

Average exchange rates applied for the years ended December 31, 2021, 2022 and 2023 and the exchange rates at December 31, 2022 and 2023 are as follows:

(In won)
	Average rate (year-to-date)						Reporting date spot rate
	2021		2022		2023		December 31, 2022		December 31, 2023
USD	₩	1,144.10		1,291.15		1,306.12		1,267.30		1,289.40
JPY		10.42		9.85		9.32		9.53		9.13
CNY		177.36		191.60		184.28		181.44		180.84
TWD		40.99		43.36		41.94		41.27		41.98
EUR		1,353.25		1,357.29		1,412.67		1,351.20		1,426.59
PLN		296.51		289.78		311.36		288.70		329.11
VND		0.0499		0.0551		0.0548		0.0537		0.0532

Interest Rate Risk

The interest rate profile of the Group’s interest-bearing financial instruments as of December 31, 2022 and 2023 is as follows:

(In millions of won)
	December 31, 2022			December 31, 2023
Fixed rate instruments
Financial assets	₩	3,547,256			3,163,490
Financial liabilities		(6,025,365	)		(6,333,238	)
	₩	(2,478,109	)		(3,169,748	)
Variable rate instruments
Financial liabilities	₩	(8,966,045	)		(10,195,891	)

Maximum Exposure to Credit Risk of Financial Assets

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk as of December 31, 2022 and 2023 are as follows:

(In millions of won)
	December 31, 2022		December 31, 2023
Financial assets carried at amortized cost
Cash equivalents	₩	1,823,573		2,257,519
Deposits in banks		1,722,618		905,982
Trade accounts and notes receivable, net		2,358,914		3,218,093
Non-trade receivables		146,921		112,739
Accrued income		22,505		14,246
Deposits		26,586		18,378
Loans		88,868		59,884
Lease receivables		11,058		4,130
	₩	6,201,043		6,590,971
Financial assets at fair value through profit or loss
Convertible securities	₩	1,797		3,127
Derivatives		230,080		169,703
	₩	231,877		172,830
	₩	6,432,920		6,763,801

Contractual Maturities of Financial Liabilities, Including Estimated Interest Payments

The following are the contractual maturities of financial liabilities, including estimated interest payments, as of December 31, 2022 and 2023.

			2022
(In millions of won)			Contractual cash flows in
	Carrying amount		Total		6 months or less			6-12 months		1-2 years		2-5 years		More than 5 years
Non-derivative financial liabilities
Borrowings	₩	13,542,664		14,674,463		4,329,345			1,266,247		3,135,925		5,591,303		351,643
Bonds		1,448,746		1,570,630		338,815			16,956		400,764		727,752		86,343
Trade accounts and notes payable		4,061,684		4,061,684		3,523,098			538,586		—		—		—
Other accounts payable		2,307,190		2,309,929		2,231,832			78,097		—		—		—
Other accounts payable (enterprise    procurement cards) (*)		935,739		935,739		935,739			—		—		—		—
Long-term other accounts payable		435,232		508,194		—			—		103,450		245,064		159,680
Security deposits received		146,788		191,735		—			2,262		8,463		181,010		—
Lease liabilities		72,788		77,803		26,733			16,995		18,552		10,743		4,780
Derivative financial liabilities
Derivatives	₩	47,408		29,418		(1,637	)		10,741		3,024		17,290		—
	₩	22,998,239		24,359,595		11,383,925			1,929,884		3,670,178		6,773,162		602,446

(*) Represents liabilities payable to credit card companies for utility expenses and others paid using enterprise procurement cards. The Group presented the payable to credit card companies as other accounts payable and disclosed related cash flows as operating activities since the Group is using the enterprise procurement cards through agreements with suppliers for transactions arising from purchasing of goods and services, the payment term is within a year from the purchase, as part of the normal operating cycle, and no security is provided.

Summary of Other Accounts Payable

Change in liabilities related to procurement cards for the year ended December 31, 2022 is as follows:

(In millions of won)
	January 1, 2022		Change (Cash flows from operation activities)			December 31, 2022
Other accounts payable (enterprise procurement cards)	₩	1,074,089		(138,350	)		935,739

Summary of Capital Management

(In millions of won)
	December 31, 2022			December 31, 2023
Total liabilities	₩	24,366,792			26,988,754
Total equity		11,319,227			8,770,544
Cash and deposits in banks(*1)		3,547,256			3,163,493
Borrowings (including bonds)		14,991,410			16,529,129
Total liabilities to equity ratio		215	%		308	%
Net borrowings to equity ratio(*2)		101	%		152	%

(*1) Cash and deposits in banks consist of cash and cash equivalents and current deposits in banks.

(*2) Net borrowings to equity ratio is calculated by dividing total borrowings (including bonds and excluding lease liabilities and others) less cash and current deposits in banks by total equity.

26.Financial Risk Management, Continued

Fair Values of Financial Assets and Liabilities, Together with Carrying Amounts Shown in Consolidated Statement of Financial Position

The fair values of financial assets and liabilities, together with the carrying amounts shown in the consolidated statements of financial position as of December 31, 2022 and 2023 are as follows:

(In millions of won)
	December 31, 2022				December 31, 2023
	Carrying amounts		Fair values		Carrying amounts		Fair values
Financial assets carried at amortized cost
Cash and cash equivalents	₩	1,824,649	(*)			2,257,522	(*)
Deposits in banks		1,722,618	(*)			905,982	(*)
Trade accounts and notes receivable		2,358,914	(*)			3,218,093	(*)
Non-trade receivables		146,921	(*)			112,739	(*)
Accrued income		22,505	(*)			14,246	(*)
Deposits		26,586	(*)			18,378	(*)
Loans		88,868	(*)			59,884	(*)
Lease receivables		11,058	(*)			4,130	(*)
Financial assets at fair value through profit or loss
Equity instruments	₩	96,064		96,064		87,027		87,027
Convertible securities		1,797		1,797		3,127		3,127
Derivatives		230,080		230,080		169,703		169,703
Financial liabilities at fair value through profit or    loss
Derivatives	₩	47,408		47,408		63,526		63,526
Financial liabilities effective for fair value hedging
Derivatives	₩	—		—		36,052		36,052
Financial liabilities carried at amortized cost
Borrowings	₩	13,542,664		13,521,494		15,040,986		15,101,258
Bonds		1,448,746		1,377,696		1,488,143		1,479,725
Trade accounts and notes payable		4,061,684	(*)			4,175,064	(*)
Other accounts payable		3,678,161	(*)			3,276,810	(*)
Security deposits received		146,788	(*)			153,370	(*)
Lease liabilities		72,788	(*)			73,364	(*)

(*) Excluded from disclosures as the carrying amount approximates fair value.

Fair Value Hierarchy Classifications,Valuation Techniques and Inputs of Financial Instruments Measured at Fair Value

(In millions of won)	December 31, 2022
Classification	Level 1		Level 2		Level 3		Valuation technique	Input
Financial assets at fair value through    profit or loss
Equity instruments	₩	—		—		96,064	Discounted cash flow, etc.	Discount rate and Estimated cash flow, etc.
Convertible securities		—		—		1,797	Blended discount model and binominal option pricing model	Discount rate, stock price and volatility
Derivatives		—		230,080		—	Discounted cash flow	Discount rate and Exchange rate
Financial liabilities at fair value    through profit or loss
Derivatives	₩	—		47,408		—	Discounted cash flow	Discount rate and Exchange rate

(In millions of won)	December 31, 2023
	Level 1		Level 2		Level 3		Valuation technique	Input
Financial assets at fair value through    profit or loss
Equity instruments	₩	—		—		87,027	Discounted cash flow, etc.	Discount rate and Estimated cash flow, etc.
Convertible securities		—		—		3,127	Blended discount model and binominal option pricing model	Discount rate, stock price and volatility
Derivatives		—		169,703		—	Discounted cash flow	Discount rate and Exchange rate
Financial liabilities at fair value    through profit or loss
Derivatives	₩	—		63,526		—	Discounted cash flow	Discount rate and Exchange rate
Financial liabilities effective for    fair value hedging
Derivatives	₩	—		36,052		—	Discounted cash flow	Discount rate and Exchange rate

Fair Value Hierarchy Classifications, Valuation Technique and Inputs for Fair Value Measurements of Financial Instruments not Measured at Fair Value

Fair value hierarchy classifications, valuation technique and inputs for fair value measurements of the financial instruments not measured at fair value but for which the fair value is disclosed as of December 31, 2022 and December 31, 2023 are as follows:

(In millions of won)	December 31, 2022
Classification	Level 1		Level 2		Level 3		Valuation technique	Input
Liabilities
Borrowings	₩	—		—		13,521,494	Discounted cash flow	Discount rate
Bonds		—		—		1,377,696	Discounted cash flow	Discount rate

(In millions of won)	December 31, 2023
Classification	Level 1		Level 2		Level 3		Valuation technique	Input
Liabilities
Borrowings	₩	—		—		15,101,258	Discounted cash flow	Discount rate
Bonds		—		—		1,479,725	Discounted cash flow	Discount rate

iv)The interest rates applied for determination of the above fair value as of December 31, 2022 and 2023 are as follows:

	December 31, 2022	December 31, 2023
Borrowings, bonds and others	5.11~6.68%	4.60~5.02%

Changes in Financial Assets Classified as Level 3 of Fair Value Measurements

v)There is no transfer between Level 1, Level 2 and Level 3 for the years ended December 31, 2023, and the changes in financial assets classified as Level 3 of fair value measurements for the years ended December 31, 2022 and 2023 are as follows:

(In millions of won)
Classification	January 1, 2022		Acquisition		Disposal			Valuation		Changes in Foreign Exchange Rates		Replacement			December 31, 2022
Equity securities	₩	48,805		27,261		(775	)		6,248		2,720		11,805			96,064
Convertible securities		2,758		—		—			224		—		(1,185	)		1,797

(In millions of won)
Classification	January 1, 2023		Acquisition	Disposal			Valuation			Changes in Foreign Exchange Rates			December 31, 2023
Equity securities	₩	96,064	3,286		(414	)		(13,315	)		1,406		87,027
Convertible securities		1,797	1,329		—		41				(40	)	3,127

Net Gains and Losses by Category of Financial Instruments

The net gains and losses by category of financial instruments as of December 31, 2021, 2022 and 2023 are as follows:

(In millions of won)
	2021
	Financial assets at amortized cost			Financial liabilities at amortized cost			Financial assets at FVTPL			Financial liabilities at FVTPL			Other financial instruments (*)		Total
Interest income	₩	88,888		-			-			-			-			88,888
Interest expense	-				(418,674	)	-				(15,415	)	-			(434,089	)
Foreign currency differences		668,140			(848,072	)	-				(70,249	)	-			(250,181	)
(Reversal of) Bad debt expense		(273	)	-			-			-			-			(273	)
Gain or loss on disposal		(4,877	)	-				(1,242	)	-			-			(6,119	)
Gain or loss on valuation	-				(250	)		5,808			(68,421	)	-			(62,863	)
Gain or loss on derivative	-			-			-			-				221,292		221,292
Others	-			-			-				(14	)	-			(14	)
	₩	751,878			(1,266,996	)		4,566			(154,099	)		221,292		(443,359	)

(*) Other financial instruments exclude cash flow hedging derivatives.

(In millions of won)
	2022
	Financial assets at amortized cost			Financial liabilities at amortized cost			Financial assets at FVTPL		Financial liabilities at FVTPL			Derivatives (*)		Total
Interest income	₩	85,624			—			—		—			—		85,624
Interest expense		—			(403,415	)		—		(11,106	)		—		(414,521	)
Foreign currency differences		1,061,416			(946,650	)		—		(105,492	)		—		9,274
Reversal of bad debt expense		569			—			—		—			—		569
Gain or loss on disposal		(37,087	)		—			171		(2,672	)		—		(39,588	)
Gain or loss on valuation		—			—			6,473		220,240			—		226,713
Gain or loss on derivative		—			—			—		—			177,130		177,130
Others		—			—			—		(43	)		—		(43	)
	₩	1,110,522			(1,350,065	)		6,644		100,927			177,130		45,158

(*) Other financial instruments exclude cash flow hedging derivatives.

(In millions of won)
	2023
	Financial assets at amortized cost			Financial liabilities at amortized cost			Financial assets at FVTPL			Financial assets at FVOCI			Derivatives			Total
Interest income	₩	134,664			—			—			—			—			134,664
Interest expense		—			(723,429	)		—			—			—			(723,429	)
Foreign currency differences		108,546			(176,376	)		—			—			(36,052	)		(103,882	)
Reversal of bad debt expense		181			—			—			—			—			181
Gain or loss on disposal		(48,600	)		(167	)		132			(329	)		—			(48,964	)
Gain or loss on valuation		—			—			(13,274	)		—			—			(13,274	)
Gain or loss on derivative		—			—			—			—			102,116			102,116
	₩	194,791			(899,972	)		(13,142	)		(329	)		66,064			(652,588	)

Currency risk [member]

Financial Risk Management [Line Items]

Sensitivity Analysis for Each Type of Market Risk

A weaker won, as indicated below, against the following currencies which comprise the Group’s assets or liabilities denominated in a foreign currency as of December 31, 2022 and 2023, would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis is based on foreign currency exchange rate variances that the Group considers to be reasonably possible at the end of the reporting period. The analysis assumes that all other variables, in particular interest rates, would remain constant. The changes in equity and profit or loss would have been as follows:

(In millions of won)
	December 31, 2022						December 31, 2023
	Equity			Profit or loss			Equity			Profit or loss
USD (5 percent weakening)	₩	(114,317	)		(23,215	)		(68,615	)		44,361
JPY (5 percent weakening)		(8,614	)		(8,541	)		(8,160	)		(8,480	)
CNY (5 percent weakening)		(105,926	)		(5	)		(172,198	)		(2	)
TWD (5 percent weakening)		68			3			122			9
EUR (5 percent weakening)		896			(281	)		(208	)		(52	)
PLN (5 percent weakening)		11			11			8			8
VND (5 percent weakening)		(6,161	)		(6,161	)		(3,683	)		(3,683	)

Interest rate risk [Member]

Financial Risk Management [Line Items]

Sensitivity Analysis for Each Type of variable rate instruments

(In millions of won)
	Equity					Profit or loss
	1%p increase			1%p decrease		1%p increase			1%p decrease
December 31, 2022
Variable rate instruments (*)	₩	(49,885	)		49,885		(49,885	)		49,885
December 31, 2023
Variable rate instruments (*)	₩	(56,829	)		56,829		(56,829	)		56,829

(*) Financial instruments related to non-hedging interest rate swap are excluded from the calculation.