Annual Financial Report

Hanatour Service Inc.

08 July 2024

 

Annual Report

I. OUTLINE OF THE COMPANY

1. Purpose of the Company

Purpose

Remark

1. General Travel Business(Travel Agency) 2. Ticketing and Sales of Airline and Boat 3. Souvenir Sales 4. Issuing of Selling Offers 5. Real Estate Dealing and Lease 6. Optional Communication Business 7. Computer Programming and Supply 8. Telemarketing Business 9. Printing and Publishing Business 10. Issuing of Periodicals 11. Operating School to Train Travel Experts 12. Transportation Business(Chartered Buses) 13. Internet Business (Install and Provide Contents, Internet Marketing) 14. E-commerce and Information Processing 15. Advertisement (Internet and Outdoor Advertisement) 16. Information and communication Related Business 17. Web Hosting and Homepage Establishment 18. Warehousing 19. Tourists Hotel & Lodging business 20. Operation and management of Tourists Hotels & Lodging and other incidental facilities 21. Tourists Hotels & Lodging Management Business 22. Investment, Development, Operation and Asset Management of the Domestic and Overseas Real Estate 23. Real Estate Agent Business 24. Management of Intellectual Property Rights and License Business (Brand, Trademark Rights) 25. Intangible Assets Sales and Service (Knowledge, Information) 26. Production and Distribution (Movies, Broadcasting, Videos and Other Cultural Products) 27. Production and Distribution of Digital Contents 28. Operating Performance Facilities 29. Planning Performance 30. Character business 31. Exhibition and Event Agency 32. Internet Broadcasting 33. Tourism Development and Incidental Business (Marketing Counsel, Planning and Consulting) 34. Education service 35. Operation of Lifelong E-learning Education Facilities 36. Gift Certificate Sales 37. Wedding Consulting 38. Amusement Park Operation 39. Comprehensive Leisure Facilities and Operation Management 40. Tourist Attraction Development Business 41. Comprehensive Recreation Business 42. International Conference Planning Business 43. Camping Car Business 44. Bonded Goods and Tourism Product Sales Business 45. Accommodation Business 46. Accommodation reservation Service 47. Web Portal and Internet Information Service 48. Franchise Business 49. Restaurant Business 50. Shopping Center Leasing and Sublease Business 51. Ticket sales related to Culture, Arts and Sports Events 52. Database Development and Sales Related to Culture, Arts and Sports 53. Investment of Cultural Projects (Performances and Film Production) 54. Organization of Events and Sponsors 55. Importation and Agency Business of Performance Publication Rights 56. Brokerage Agency Business for Copyrights and Neighboring Copyrights of Performance 57. Membership Sales and Brokerage Arrangements 58. Overseas Studies Agency Business 59. Lifelong Education Facilities Operating 60. Financial Loan and Other Financial Service Business 61. Electronic Financial Business 62. Planning and Promotion of Performance, Concert, Exhibition 63. Credit Card Business 64. Real Estate Development Business 65. Insurance Agent Business 66. All Other Incidental Businesses

2. Important Business

General Travel Business(Travel Agency)

3. History of the Company

A. Changes after the establishment

Date	Important Changes
Oct. 25, 1993	Established Kookjin Travel Co., Ltd. (Capital: 350 million won) 55-4 Seosomun-dong, Jung-gu, Seoul
Dec. 01, 1995	Set the company policy in 'comprehensive wholesales' and launched 'Hana Tour', independent package brand, and commenced the agency sales
Nov. 28, 2000	Listed on KOSDAQ (commenced trading)
Nov. 10, 2006	Listed on LSE(London Stock Exchange)
Nov. 01, 2011	Listed on KOSPI
Jan. 01, 2012	CEO changed - SangHwan Park and HuynSyuk Choi
Mar. 25, 2016	CEO changed - SangHwan Park and JinKook Kim
Mar. 26, 2020	CEO changed - JinKook Kim and MiSun Song
Mar. 25, 2022	CEO changed - MiSun Song and KyungKen Yuk
Dec. 31, 2022	CEO changed - MiSun Song

B. Change of trade name

Date	Changes
Mar. 6, 1996	Changed the name from Kookjin Travel Co., Ltd. to Hana Tour Co., Ltd. ** Purpose is to unify the brand name and company image

C. Change of location for head office

Date	Location
Oct. 25, 1993	55-4 Seosomun-dong, Jung-gu, Seoul
Mar. 22, 1996	10F Inju Building, Tour cost fees-1 Seorin-dong, Jongro-gu, Seoul
Oct. 01, 1997	11F Hanmi Building, 1 Gonpyeong-dong, Jongro-gu, Seoul
Jun. 15, 2005	1 Gongpyeong-dong, Jongro-gu, Seoul
Jul. 01. 2013	HanaTour Bldg. 41, Insadon 5-gil, Jongno-gu, Seoul

D. Merger, spin off (merger), comprehensive stock swap, transfer, important business assignment and others

Not applicable.

4. Domestic Place of Business

Classification	Location	Main Business
Head Office	41, Insadong 5-gil, Jongno-gu, Seoul, Republic of Korea	General Travel Business and Ticketing
Busan Sales Office	7, Chungjang-daero 9beon-gil, Jung-gu, Busan, Republic of Korea
Airport Office (Terminal1)	271, Gonghang-ro, Jung-gu, Incheon, Republic of Korea
Airport Office (Commodity Support)	124, Yeongjong-daero, Jung-gu, Incheon, Republic of Korea
Suwon Sales Office	46, Gwongwang-ro 180beon-gil, Paldal-gu, Suwon-si, Gyeonggi-do, Republic of Korea
Seongnam Sales Office	42, Jangmi-ro, Bundang-gu, Seongnam-si, Gyeonggi-do, Republic of Korea
Bucheon Sales Office	203, Buil-ro, Wonmi-gu, Bucheon-si, Gyeonggi-do, Republic of Korea
Daegu Sales Office	648, Gukchaebosang-ro, Jung-gu, Daegu, Republic of Korea
Daejeon Sales Office	69, Dunsanseo-ro, Seo-gu, Daejeon, Republic of Korea
Gwangju Sales Office	136, Geumnam-ro, Buk-gu, Gwangju, Republic of Korea
Gangneung Slaes Office	2141, Gyeonggang-ro, Gangneung-si, Gangwon-do, Republic of Korea
Chuncheon Slaes Office	110, Jungang-ro, Chuncheon-si, Gangwon-do, Republic of Korea
Wonju Sales Office	65, Neungnadong-gil, Wonju-si, Gangwon-do, Republic of Korea
Jeonju Sales Office	269, Hongsan-ro, Wansan-gu, Jeonju-si, Jeollabuk-do, Republic of Korea
Suncheon Sales Office	15, Chunghyo-ro, Suncheon-si, Jeollanam-do, Republic of Korea
Changwon Sales Office	754, Changwon-daero, Seongsan-gu, Changwon-si, Gyeongsangnam-do, Republic of Korea
Travel Desk	51, Sogong-ro, Jung-gu, Seoul, Republic of Korea

5. Status of Employees (As of December 31, 2023)

(Unit: person)

Classification	Office & Operation
Men	616
Women	654
Total	1,270

6. Organization

II. INFORMATION ON SHARES

1. Total Number of Stocks, Etc.

A. Total number of stocks (As of December 31, 2023)

(Unit: share)

Classification		Types of stocks		Remark
		Common stock	Total
I. Total number of stocks to be issued		20,000,000	20,000,000	-
II. Total number of stocks issued to this point		16,039,185	16,039,185	-
III. Total number of stocks reduced to this point		-	-	-
	1. Reduction of capital	-	-	-
	2. Retirement of shares	-	-	-
	3. Repayment of redeemed stocks	-	-	-
	4. Others	-	-	-
IV. Total number of stocks issued (II-III)		16,039,185	16,039,185	-
V. Treasury stocks		549,253	549,253	-
VI. Outstanding stocks (IV-V)		15,489,932	15,489,932	-

B. Change of capital

(1) Status of capital increase

        (Unit: share, won)

Date of stock issuance	Type of issuance	Contents of issued stocks
		Types	Quantity	Par value	Issuance amount per stock	Remark
Oct. 25, 1993	-	Common stock	35,000	10,000	10,000	Capital for incorporation
Jun. 12, 1996	Capital increase with consideration (shareholder allotment)	Common stock	21.500	10,000	10,000	-
Jul. 25, 1997	Capital increase with consideration (shareholder allotment)	Common stock	35,840	10,000	10,000	-
Oct.01, 1997	-	Common stock	184,680	5,000	-	1 to 2 shares
Dec. 02, 1999	Capital increase with consideration (shareholder allotment)	Common stock	115,320	5,000	5,000	-
Dec. 23, 1999	Capital increase with consideration (shareholder allotment)	Common stock	60,000	5,000	10,000	-
May, 05, 2000	Stock Split	Common stock	3,600,000	500	-	1 to 10 shares
Nov. 16, 2000	Capital increase with consideration (shareholder allotment)	Common stock	900,000	500	2,850	-
Aug. 26, 2003	Capital increase without consideration	Common stock	3,764,034	500	-	-
Oct. 27,2004	Capital increase with consideration (shareholder allotment)	Common stock	76,322	500	11,850	-
Oct. 27,2004	Bonus Issue	Common stock	1,977,029	500	-	-
Nov. 11, 2006	Capital increase	Common stock	1,161,000	500	55,711	DR
Feb. 28, 2020	Capital increase with consideration (Third-party allotment)	Common stock	2,323,000	500	55,500	-
Jun. 29, 2022	Capital increase with consideration (Rights offering)	Common stock	2,100,000	500	49,800	-

(2) Status of capital decrease

 (Unit: share, won)

Date of capital reduction	Type	Purpose	Contents of reduced stocks
			Types	Quantity	Face value per stock	Amount of acquisition per stock (for capital decrease for consideration)	Remark
-	-	-	-	-	-	-	-

C. Contents of scheduled change for capital

No applicable change

2. Matters on Dividends

A. Matters on dividend for three recent fiscal year

Classification		31st Term	30th Term	29th Term
Face value per stock (won)		500	500	500
(Consolidated) Current net income (million won)		47,029	(66,774)	(43,987)
(Separated) Current net income (million won)		30,819	(74,617)	(38,741)
(Consolidated) Net income per share (won)		3,036	(4,618)	(3,285)
Total amount of cash dividend (million won)		77,450	-	-
Total amount of stock dividend (million won)		-	-	-
Dividend payout ratio (%)		164.7	-	-
Yield rate of cash dividend (%)	Common stock	7.8	-
	Preferred stock	-	-
Yield rate of stock dividend (%)	Common stock	-	-
	Preferred stock	-	-
Cash dividend per share (won)	Common stock	5,000	-
	Preferred stock	-	-
Stock dividend per share	Common stock	-	-
	Preferred stock	-	-

III. CONTENTS OF THE BUSINESS

1. Summary of the Business

The COVID-19 pandemic, which began in 2020, imposed unprecedented challenges on the travel industry by restricting international movement over the past three years. Fortunately, with the increase in vaccination rates and the rapid decline in the spread of the virus, the World Health Organization (WHO) declared an end to the Public Health Emergency of International Concern in May 2023, three years and four months after the onset of the pandemic. In accordance with this, the government of South Korea declared an end to the pandemic and lifted all related restrictions. As countries worldwide relaxed their quarantine measures, the travel industry began to show signs of a robust recovery.

Throughout the COVID-19 period, Hanatour focused on strengthening its product and channel capabilities. We restructured our main product line around 'Hanapack 2.0,' shifting towards mid-to-high-priced packages to simultaneously enhance customer satisfaction and profitability. As a result, Hanapack 2.0 accounted for 57% of the company's total package sales last year, a significant increase from 8% before the pandemic. This segment has now firmly established itself as a major revenue source for the company. In terms of customer satisfaction, the Hanatour Customer Satisfaction Index (HCSI) showed a marked improvement, rising from the high 70s pre-pandemic to the mid-80s following the launch of 'Hanapack 2.0.'

Hanatour also invested significantly in strengthening its online channel capabilities, particularly focusing on its mobile app. The app's usability and functionality were comprehensively upgraded, and substantial efforts were made to enhance travel content useful for both package and FIT (Free Independent Traveler) customers. Consequently, our mobile app achieved a record high of over 550,000 Monthly Active Users (MAU) in September 2023, solidifying its dominant market position. The online sales ratio of package tours also increased significantly, from 19% before the pandemic to 39%, demonstrating improved profitability through strengthened online channel capabilities.

The recovery of the package travel market began in earnest in the second half of 2023, and this trend is expected to continue into 2024. In January of this year alone, the number of package tourists sent by Hanatour increased by 40% compared to the previous month, surpassing market expectations. During the pandemic, Hanatour streamlined its cost structure by divesting underperforming subsidiaries. The focus on mid-to-high-end packages through 'Hanapack 2.0' has enhanced both customer satisfaction and profitability. The strengthened online channels have laid the foundation for increased sales of package products and combined products targeting FIT customers. Based on these improvements and market recovery, the company anticipates achieving its highest-ever annual operating profit on a consolidated basis this year.

As South Korea's leading travel company, Hanatour will continue to drive innovation and growth in the travel industry. We appreciate your continued interest and support in our new journey this year.

2. Market Share Rate

The market share rate of the travel business is classified based on the calculation in which the "Total Departures from HANATOUR" is divided by the "Total Departures of Korea." (Crews are excluded from the total departing persons)

The "Total Departure of Korea" is announced by Korea Tourism Organization (KNTO) and the "Total Departures from HANATOUR" is the figure which we report to Korean Association of Travel Agents (KATA).

<Market share rate based on the number of people>

Year	2023		2022		2021
	Total Departures from HANATOUR	Total Departures of Korea	Total Departures from HANATOUR	Total Departures of Korea	Total Departures from HANATOUR	Total Departures of Korea
	2,589,867	21,293,382	533,957	5,904,941	42,441	803,201
Share rate	12.16%		9.04%		5.28%

3. Characteristics of the market

There are four special characteristics that make travel industry distinctive.

First, Travel business has seasonality. The pricing and marketing strategies change in accordance to seasons. However, due to 5-work-day policy and more maturing society and corporate cultures, the gap between the demands of seasons is shrinking which demanding changes to the products and strategies of travel agents.

Second, travel industry has time limits and has no inventory. This is in-line with air transportation, and hotel business. Products must be sold on each day, or the inventories will disappear automatically. Therefore, it is very important to have marketing strategy and diversified portfolio of products in order to get rid of all the inventories that the company possesses.

Third, travel industry is easy to copy. Therefore, the company needs to find new elements that would differentiate the company among competitors.

Last, travel industry is volatile. Compared to other industries it is affected by political, diplomatic, various social issues, economic issue, diseases, and other aspects as well.

4. New Business Development

   Not Applicable.

Ⅳ. Status of the Parent Company and Affiliated Companies

1. Status of the parent company

   Not applicable.

2. Status of affiliated companies

(Unit: Share, %)

Name of the Company	Business Contents	No. of Shares	Ownership Ratio (%)
Hanatour Business Service Inc.	Travel Business	400,000	100.00
Hana Tourist Inc.	Travel Business	906,981	30.23
Hanatour Jeju Service Inc.	Travel Business	618,830	77.35
Hanatour ITC Service Inc.	Travel Business	20,400,000	100.00
Tour Marketing Korea Service Inc.	Travel Business	140,000	70.00
Web Tour Service Inc.	Travel Business	8,777,380	76.99
Hana Finance Service Inc.	Finance Service	3,400,000	100.00
SM duty free Co., Ltd.	Duty Free Business	12,325,387	90.13
Hanatour Europe Ltd.	Travel Business	4,200	70.00
Hanatour Japan Co., Ltd.	Travel Business	6,836,300	53.98
Hanatour CHINA	Travel Business	-	100.00
Hanatour HongKong Co., Ltd.	Travel Business	11,000,000	100.00
Beijing Hana Information Technology Co., Ltd.	Software Technical Development	-	100.00
Hanatour Service (M) Sdn.Bhd.	Travel Business	1,500,000	100.00
HANATOUR VIETNAM COMPANY LIMITED	Travel Business	-	85.00
PHILIPPINE HANATOUR INC.	Travel Business	218,797	99.99
HNT SG PTE. LTD.	Travel Business	-	-

3. Concurrent status of the executive management

Not applicable.

Ⅴ. SUMMARY OF FINANCIAL DATA

* We've applied K-IFRS 1115 form 2018 and rewrote 2017 and 2016 Financial Results using K-IFRS 1115

1. Financial results

(In thousand won, except per share amounts)

Classification	31st Term	30th Term	29th Term
Sales	324,720,747	66,269,096	10,781,802
Operating Expenses	306,314,041	156,798,748	108,327,485
Operating Income	18,406,706	(90,529,652)	(97,545,683)
Profit Before Tax	31,237,113	(77,690,960)	(43,530,465)
Income Tax Expense	418,144	(3,074,173)	(4,789,718)
Net Income	30,818,969	(74,616,787)	(38,740,747)
Net Income per Share(Won)	1,990	(5,160)	(2,893)

2. Financial position

(In thousand won)

Classification	31st Term	30th Term	29th Term
Current Assets	367,002,425	202,531,190	86,185,310
Non-Current Assets	118,773,275	115,786,404	128,627,359
Total Assets	485,775,700	318,317,593	214,812,670
Current Liabilities	296,740,313	162,469,875	92,071,844
Long-term Liabilities	8,233,563	5,864,863	2,199,736
Total Liabilities	304,973,876	168,334,738	94,271,580
Capital Stock	8,019,593	8,019,593	6,969,593
Other Paid-in Capital	(20,526,418)	119,473,582	16,465,030
Elements of Other Shareholder's Equity	(9,097)	(9,097)	(9,097)
Retained Earnings	193,317,746	22,498,777	97,115,564
Total Shareholder's Equity	180,801,824	149,982,855	120,541,089
Total Liabilities and Shareholder's Equity	485,775,700	318,317,593	214,812,670

Ⅵ. RISK FACTORS

Refer to III - 1. Summary of the Business

Ⅶ. MANAGEMENT

Full-time / Part-time	Name	Position	Assigned Task
Full-time	SangHwan Park	Chairman, Director	General Management
Full-time	HeeSeok Kweon	Senior Vice Chairman, Director	General Management
Full-time	MiSun Song	Chief Executive Officer and Director	General Management
Full-time	ChangHo Ryu	Executive Director, Director	General Management
Part-time	HyeLeon Yoo	Auditor, Outside Director	Outside Director
Part-time	InWhan Chang	Auditor, Outside Director	Outside Director
Part-time	MoonHyun Kim	Auditor, Outside Director	Outside Director
Part-time	SangMan Han	Auditor, Outside Director	Outside Director
Part-time	InJun Song	Non-Executive Director	Non-Executive Director
Part-time	YoungHo Kim	Non-Executive Director	Non-Executive Director
Part-time	ChanWoo Park	Non-Executive Director	Non-Executive Director

Ⅷ. LIST OF MAJOR SHAREHOLDERS

Shareholder	Number of shares	Percentage
Harmonia 1 limited company and 5 people with a special relationship	4,456,100	27.78%
HANATOUR INC.	549,253	3.42%

Ⅸ. CURRENT STATUS OF INVESTMENTS

1. Domestic

Name of the Company	Ownership Company	No. of Shares	Ownership Ratio (%)
Hanatour Business Service Inc.	HANATOUR Service Inc.	400,000	100.00
Hana Tourist Inc.	HANATOUR Service Inc.	906,981	30.23
Hanatour Jeju Service Inc.	HANATOUR Service Inc.	618,830	77.35
Hanatour ITC Service Inc.	HANATOUR Service Inc.	20,400,000	100.00
Tour Marketing Korea Service Inc.	HANATOUR Service Inc.	140,000	70.00
OK Tour Service Inc.	HANATOUR Service Inc.	9,784	48.92
Web Tour Service Inc.	HANATOUR Service Inc.	8,777,380	76.99
Nextour Co., Ltd.	Web Tour Service Inc.	40,000	100.00
Gyoyugyeohaeng Co., Ltd	HANATOUR Service Inc.	398,000	19.90
Hana Finance Service Inc.	HANATOUR Service Inc.	3,400,000	100.00
SM duty free Co., Ltd.	HANATOUR Service Inc.	12,325,387	90.13
InterparkTriple Corp.	HANATOUR Service Inc.	60,876	0.50
Hani Tour Inc.	HANATOUR Service Inc.	19,078	9.54
SAM Consulting Co.,Ltd.	HANATOUR Service Inc.	1,667	7.41
KBSJ Tourism Venture Union	HANATOUR Service Inc.	-	9.26
P&I Cultural Innovation Investment Union	HANATOUR Service Inc.	-	9.26
Silla Animal Inc.	HANATOUR Service Inc.	11,310	11.87
WOONGJIN CO., LTD.	Hanatour Business Service Inc.	6,903	0.01
Jeju Channel Inc.	Hanatour Jeju Service Inc.	50,000	8.06
Dream Co., Ltd.	HANATOUR Service Inc.	2,250	2.08
	Hanatour Jeju Service Inc.	2,250	2.08

2. Overseas

Name of the Company	Ownership Company	Region	No. of Shares	Ownership Ratio (%)
Hanatour Europe Ltd.	HANATOUR Service Inc.	London	4,200	70.00
Hanatour Japan Co., Ltd.	HANATOUR Service Inc.	Japan	6,836,300	53.98
U.I Sightseeing Bus LLC	HANATOUR JAPAN CO., LTD	Japan	1,900	100.00
Hanatour CHINA	HANATOUR Service Inc.	China	-	100.00
Hanatour HongKong Co., Ltd.	HANATOUR Service Inc.	Hong Kong	11,000,000	100.00
Hanatour Europe S.R.L	HANATOUR Service Inc.	Italy	5,250	50.00
Allegrox TM Hotel	HANATOUR JAPAN CO., LTD	Japan	396	100.00
Beijing Hana Information Technology Co., Ltd.	HANATOUR Service Inc.	China	-	100.00
Hanatour Service (M) Sdn.Bhd.	HANATOUR Service Inc.	Malaysia	1,500,000	100.00
Hanatour Janpan System Vietnam	HANATOUR JAPN CO., LTD	Vietnam	-	100.00
HANATOUR VIETNAM COMPANY LIMITED	HANATOUR Service Inc.	Vietnam	-	85.00
PHILIPPINE HANATOUR INC.	HANATOUR Service Inc.	Philippines	218,797	99.99
HNT SG PTE. LTD.	HANATOUR Service Inc.	Singapore	-	-
KC HOSPITALITY CO.,LTD	HANATOUR Service Inc.	Laos	57,600	10.00

Ⅹ. MAJOR CREDITORS

Not applicable.

XI. IMPORTANT EVENTS AFTER THE SETTLEMENT OF

ACCOUNTS PERIOD

(1)  Hanatour Service (M) Sdn.Bhd. which is one of subsidiaries of the Group resolved to dissolve on February 16, 2024.

XII. OTHER IMPORTANT FACTS ABOUT THE BUSINESS

Not applicable.

                    HANATOUR SERVICE INC. AND SUBSIDIARIES

                    Consolidated Financial Statements

                          December 31, 2023 and 2022

HANATOUR SERVICE INC. AND SUBSIDIARIES

Consolidated Statements of Financial Position

As of December 31, 2023and 2022

(In thousands of won)			2023		2022
Assets
Cash and cash equivalents		W	118,664,728		92,497,218
Short-term financial instruments			145,600,341		88,602,428
Trade receivables			61,769,325		39,362,975
Other receivables			11,009,797		5,856,639
Finance lease receivables			873,674		570,354
Inventories			59,064,708		8,274,560
Advance payments			36,807,411		25,212,457
Other current assets			3,165,293		2,996,919
Other financial assets			8,912,662		6,795,589
Current tax assets			1,089,720		371,081
Total current assets			446,957,658		270,540,219
Non-current financial assets at FVTPL			3,606,339		3,012,260
Financial assets at FVOCI			1,192,983		1,189,200
Investments in associates and joint ventures			4,892		702,932
Long-term finance lease receivables			1,028,040
Long-term other receivables			3,869,520		4,125,824
Investment property, net			886,089		1,108,747
Property and equipment, net			11,561,649		10,176,272
Right-of-use assets			92,509,393		76,601,501
Intangible assets			16,720,494		22,932,160
Other financial assets			11,301,479		12,723,620
Deferred tax assets			54,925,964		52,292,869
Other non-current assets			31,879		23,838
Total non-current assets			197,638,720		184,889,221
Total assets		W	644,596,378		455,429,440

HANATOUR SERVICE INC. AND SUBSIDIARIES

Consolidated Statements of Financial Position, Continued

As of December 31, 2023and 2022

(In thousands of won)			2023		2022
Liabilities
Trade payables		W	80,874,678		41,976,540
Other payables			63,981,265		47,177,054
Income tax payables			671,634		362,065
Deposits received for travel			163,826,944		77,008,167
Advances received			17,935,127		22,423,174
Short-term borrowings			8,682,599		14,370,131
Current portion of long-term borrowings			1,803,197		2,086,092
Finance lease liabilities			16,810,476		13,914,120
Provisions			1,142,630		892,688
Other financial liabilities			2,467,894		2,084,106
Other current liabilities			11,881,663		10,464,511
Total current liabilities			370,078,106		232,758,647
Long-term other payables			-		142,878
Long-term borrowings			5,337,856		7,865,108
Long-term provisions			433,104		198,919
Long-term finance lease liabilities			104,502,824		105,785,176
Provision for long-term employee benefits			796,885		4,404,615
Other non-current liabilities			4,119523		4,572,449
Total non-current liabilities			115,214,192		122,969,145
Total liabilities			485,292,298		355,727,793
Equity
Capital stock			8,019,593		8,019,593
Other contributed capital			(7,085,791)		132,914,209
Components of other capital			2,624,819		2,642,459
Retained earnings			166,799,642		(20,268,959)
Equity attributable to the owners of the Parent Company			170,358,263		123,307,301
Non-controlling interests			(11,054,183)		(23,605,653)
Total equity			159,304,079		99,701,648
Total liabilities and equity		W	644,596,378		455,429,440

HANATOUR SERVICE INC. AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income (Loss)

For the years ended December 31, 2023and 2022

(In thousands of won, except earnings per share data)			2023		2022
Operating revenue		W	411,611,609		114,969,463
Operating expense			377,563,623		216,153,549
Bad debt expense			(4,149,653)		(1,500,026)
Other operating expense			381,713,276		217,653,575
Operating income			34,047,986		(101,184,086)
financial income			7,826,709		3,158,458
Financial expense			2,863,292		2,847,390
Loss from investment in associates and joint ventures			92,334		355,249
Other income			21,880,866		43,045,885
Other expense			3,680,370		11,378,724
Income (loss) before income taxes			57,304,234		(68,850,608)
Income taxes of continuing operations			(1,529,561)		(4,083,086)
Net loss		W	58,833,795		(64,572,425)
Net loss from continuing operations			58,833,795		(64,767,522)
Net loss from discontinued operations			222,968		195,097
Other comprehensive income after tax expense			781,731		2,757,022
Items that will never be reclassified to profit of loss:
Loss on valuation financial assets at FVOCI			3,669		2,749
Items that are or may be reclassified subsequently to profit of loss:
Gain on foreign operations translation, net			778,062		2,754,273
Total comprehensive income (loss)		W	59,838,493		(61,815,403)
Net income (loss) attributable to:
Owners of the Parent Company			47,028,589		(66,773,945)
Non-controlling interests			12,028,173		2,201,520
		W	59,056,762		(64,572,425)
Comprehensive income (loss) attributable to:
Owners of the Parent Company			47,010,458		(66,053,865)
Non-controlling interests			12,828,035		4,238,462
		W	59,838,493		(61,815,403)
Earnings (losses) per share
Basic earnings (losses) per share attributable to (in won) :			3,036		(4,618)
Continuing operation (in won)			3,023		(4,630)
Discontinued operation (in won)			13		12
Diluted earnings (losses) per share attributable to (in won) :		W	3,036		(4,618)
Continuing operation (in won)			3,023		(4,630)
Discontinued operation (in won)			13		12

HANATOUR SERVICE INC. AND SUBSIDIARIES

Consolidated Statements of Changes in Equity

For the years ended December 31, 2023and 2022

(In thousands of won)		Capital Stock		Other contributed capital		Components of other capital		Retained earnings		Non-controlling interests		Total shareholders' equity
January 1, 2022	W	6,969,593		29,905,656		1,947,292		46,504,986		(27,571,400)		57,756,127
Net loss		-		-		-		(66,773,945)		2,201,520		(64,572,425)
Gain on foreign operations translation		-		-		718,621		-		2,035,652		2,754,273
Gain on valuation financial assets at FVOCI		-		-		1,458		-		1,291		2,749
Paid-in capital increase of Subsidiaries Dividends		1,050,000		103,008,553		-		-		-		104,058,553
Dividends										(343,611)		(343,611)
Changes in scope of consolidation		-		-		(24,913)		-		70,895		45,982
December 31, 2022	W	8,019,593		132,914,209		2,642,458		(20,268,959)		(23,605,653)		99,701,648
January 1, 2023	W	8,019,593		132,914,209		2,642,458		(20,268,959)		(23,605,653)		99,701,648
Net lncome		-		-		-		47,028,589		12,028,173		59,056,762
Gain on foreign operations translation		-		-		(21,064)		-		799,126		778,062
Gain on valuation financial assets at FVOCI		-		-		2,933		-		736		3,669
Transfer of retained earnings		-		(140,000,000)		-		140,000,000		-		-
Dividends		-		-		-		-		(236,069)		(236,069)
Changes in scope of consolidation		-		-		491		40,012		(40,504)		-
December 31, 2023	W	8,019,593		(7,085,791)		2,624,819		166,799,642		(11,054,184)		159,304,079

HANATOUR SERVICE INC. AND SUBSIDIARIES                                  

Consolidated Statements of Cash Flows

For the years ended December 31, 2023and 2022

(In thousands of won)			2023		2022
Cash flows from operating activities
Net income(loss)		W	59,056,762		(64,572,425)
Additions of expenses not involving cash outflows and others			27,756,868		39,113,602
Deduction of incomes not involving cash inflows and others			(21,022,948)		(35,842,600)
Movements in operating assets and liabilities:
Decrease in trade receivables			(20,663,371)		(29,287,967)
Decrease (increase) in other receivables			(3,415,555)		2,242,569
Decrease in inventories			(51,509,240)		(6,699,621)
Decrease in advance payments			(9,865,813)		(12,171,934)
Decrease in other current assets			(18,762)		(960,839)
Increase (decrease) in other non-current assets			(22,115)		167,560
Increase in trade payables			38,922,066		33,362,874
Decrease in other payables			10,475,434		301,053
Increase in deposits received for travel			86,912,668		68,989,862
Decrease in advances received			(4,013,053)		(3,404,855)
Increase in other financial liabilities			63,557		7,868
Increase in other current liabilities			4,000,043		1,048,138
Decrease in provisions			(1,194,146)		(525,909)
Decrease in long-term other payables			-		(49,960)
Decrease in other long-term employee benefit			(151,500)		(179,055)
			115,310,895		(8,461,640)
Interest expense paid			(2,999,941)		(2,859,892)
Interest income received			6,025,564		1,608,360
Income taxes paid			(1,609,915)		(527,693)
Net cash provided by operating activities		W	116,726,602		(10,240,865)

HANATOUR SERVICE INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows, Continued

For the years ended December 31, 2023and 2022

(In thousands of won)			2023		2022
Cash flows from investing activities
Cash inflows from investing activities:
Decrease in short-term financial instruments		W	176,743,468		39,696,173
Decrease in other receivables			670,150		159,233
Disposal of financial assets at FVTPL			-		200,000
Disposal of financial assets at amortized cost measurement			157,627		-
Disposal of investment in associates and joint venture			781,956		251,100
Disposal of property and equipment			438,639		677,031
Disposal of intangible assets			-		488,022
Decrease in finance lease receivables			1,278,075		588,448
Decrease in other financial assets			4,386,632		5,997,337
Government grants			-		32,846
Cash outflows for investing activities:
Increase in short-term financial instruments			233,854,168		111,311,078
Increase in other receivables			2,163,032		10,802
Acquisition of financial assets at FVTPL					-
Acquisition of property and equipment			5,300,618		1,810,936
Acquisition of intangible assets			2,117,029		3,223,260
Increase in other financial assets			5,847,607		3,072,094
Net cash used in investing activities		W	(64,825,906)		(71,337,980)

HANATOUR SERVICE INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows, Continued

For the years ended December 31, 2023and 2022

(In thousands of won)			2023		2022
Cash flows from financing activities
Cash inflows from financing activities:
Proceeds from short-term borrowings		W	28,657,977		40,488,800
Proceeds from long-term borrowings			-		15,923
Paid-in capital increase of subsidiaries			7		104,139,523
Proceeds from leasehold deposits received			420,149		296,200
Cash outflows for financing activities:
Repayment of short-term borrowings			33,860,020		41,521,004
Repayment of current portion of long-term borrowings			2,006,062		3,916,979
Repayment of long-term borrowings			450,846		-
Repayment of finance lease liabilities			17,511,380		28,930,991
Payment of dividends			276,840		352,519
Payment of leasehold deposits received			47,100		204,194
Net cash provided by financing activities			(25,074,115)		70,014,759
Increase (decrease) in cash on changes in scope of consolidation					-
Net decrease in cash and cash equivalents			26,826,579		(11,564,086)
Cash and cash equivalents at beginning of year			92,497,218		105,686,896
Effect of exchange rate change			(659,070)		(1,625,592)
Cash and cash equivalents at end of year		W	118,664,728		92,497,218

 

END