REG - Hanatour Service Inc - FY2021 Annual Financial Report
18/12/2023 07:00
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RNS Number : 1262X Hanatour Service Inc. 18 December 2023
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
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 11, Jayupyeonghwa-ro, Busanjin-gu, Busan, Republic of Korea
Kimhae 108, Gonghangjinip-ro, Gangseo-gu, Busan, Republic of Korea
Airport Office
Incheon Sales Office 59, Bupyeong-daero, Bupyeong-gu, Incheon, Republic of Korea
Airport Office 271, Gonghang-ro, Jung-gu, Incheon, Republic of Korea
(Terminal1)
Airport Office 446, Je2terminal-daero, Jung-gu, Incheon, Republic of Korea
(Terminal2)
Airport Office 124, Yeongjong-daero, Jung-gu, Incheon, Republic of Korea
(Commodity Support)
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 317, Gangneung-daero, 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, Paldal-ro, Wansan-gu, Jeonju-si, Jeollabuk-do, Republic of Korea
Changwon 754, Changwon-daero, Seongsan-gu, Changwon-si, Gyeongsangnam-do,
Sales Office Republic of Korea
5. Status of Employees (As of December 31, 2021)
(Unit: person)
Classification Office & Operation
Men 590
Women 590
Total 1,180
6. Organization
II. INFORMATION ON SHARES
1. Total Number of Stocks, Etc.
A. Total number of stocks (As of December 31, 2020)
(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 13,939,185 13,939,185 -
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) 13,939,185 13,939,185 -
V. Treasury stocks 549,253 549,253 -
VI. Outstanding stocks (IV-V) 13,389,932 13,389,932 -
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 -
(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 Remark
(for capital decrease for consideration)
- - - - - - - -
C. Contents of scheduled change for capital
No applicable change
2. Matters on Dividends
A. Matters on dividend for three recent fiscal year
Classification 28(th) Term 28(th) Term
Face value per stock (won) 500 500
(Consolidated) Current net income (million won) (49,987) (172,012)
(Separated) Current net income (million won) (38,741) (99,210)
(Consolidated) Net income per share (won) (3,285) (13,210)
Total amount of cash dividend (million won) - -
Total amount of stock dividend (million won) - -
Dividend payout ratio (%) - -
Yield rate of cash dividend (%) Common stock - -
Preferred stock - -
Yield rate of stock dividend (%) Common stock - -
Preferred stock - -
Cash dividend per share (won) Common stock - -
Preferred stock - -
Stock dividend per share Common stock - -
Preferred stock - -
III. CONTENTS OF THE BUSINESS
1. Summary of the Business
For the last 30years, Korea's outbound volume has continued to grow gradually,
due to increased leisure time and national disposable income growth. However,
the outbreak of COVID-19 restricted cross-country travel and Korea's outbound
volume decreased significantly.
Hanatour tried to find new demand for safe travel, commercial travel,
chartered flights for Korean residents, and domestic travel, but had to spend
the worst year without making notable performance, owing to the aggressive
spread of the virus, and strengthening quarantine of overseas immigrants.
As the result of these factors, Korea's outbound volume decreased 78%YOY,
Hanatour's PKG volume was 6 thousand showing approximately 97% decrease over
2020 records, and Air Ticket volume was 35thousand showing a significant
decrease of 91% YOY. All in all, Hanatour's blended YOY volume growth in 2021
was -93% with approximately 43thousand customers.
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).
Year 2020 2019 2019
Total Total Total Total Total Total
Departures Departures Departures Departures Departures Departures
from of Korea from of Korea from of Korea
HANATOUR HANATOUR HANATOUR
42,441 803,201 646,444 3,688,606 5,143,867 26,920,415
Share rate 5.28% 17.53% 19.11%
3. Characteristics of the market
There are three 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 are 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 have to 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 24,400,000 100.00
Tour Marketing Korea Service Inc. Travel Business 140,000 70.00
Web Tour Service Inc. Travel Business 8,777,380 76.99
Mark Hotel Co., Ltd. Hotel Business 40,000,000 100.00
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 USA Inc. Travel Business 350,000 100.00
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 PTY. Ltd. Travel Business 600,000 100.00
Hanatour HongKong Co., Ltd. Travel Business 5,000,000 100.00
Beijing Hana Information Technology Co., Ltd. Software Technical Development - 100.00
Hanatour Service (M) Sdn.Bhd. Travel Business 1,500,000 100.00
HANATOUR EU GMBH Travel Business - 100.00
CAMLAO HANATOUR CO., LTD. Travel Business 300,000 100.00
HANATOUR VIETNAM COMPANY LIMITED Travel Business - 85.00
HANATOUR PHILIPPINES CORP. Travel Business 1,267,980 97.54
HNT ITALIA-SOCIETA' A Travel Business - 51.00
RESPONSAVILITA' LIMITATA
3. Concurrent status of the executive management
Executive management Concurrent Company
Name Position Company Name Position Assigned Task
SangHwan Park Chairman HANATOUR PTE LTD. Director General Management
KyungKen Yuk Vice President Hanatour Business Service Inc. Director General Management
Web Tour Service Inc. Director General Management
SM duty free Co., Ltd. Chief Executive Officer General Management
Hana Finance Service Inc. Director General Management
Hana Tourist Inc. Director General Management
CELINO INC Director General Management
Hanatour ITC Service Inc. Director General Management
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 29(th) Term 28(th) Term 27(th) Term
Sales 10,781,802 73,947,230 462,940,363
Operating Expenses 108,327,485 149,962,759 457,256,969
Operating Income (97,545,683) (76,015,530) 5,683,395
Profit Before Tax (43,530,465) (131,191,120) (31,876,068)
Income Tax Expense (4,789,718) (31,981,313) 2,779,238
Net Income (38,740,747) (99,209,807) (34,655,306)
Net Income per Share(Won) (2,893) (7,619) (3,131)
2. Financial position
(In thousand won)
Classification 29(th) Term 28(th) Term 27(th) Term
Current Assets 86,185,310 121,274,400 163,151,889
Non-Current Assets 128,627,359 226,035,622 295,927,124
Total Assets 214,812,670 347,310,022 459,079,014
Current Liabilities 92,071,844 95,992,675 226,927,968
Long-term Liabilities 2,199,736 92,035,510 98,159,130
Total Liabilities 94,271,580 188,028,185 325,087,098
Capital Stock 6,969,593 6,969,593 5,808,093
Other Paid-in Capital 16,465,030 186,465,030 58,700,030
Elements of Other Shareholder's Equity (9,097) (9,097) (9,097)
Retained Earnings 97,115,564 (34,143,689) 69,492,890
Total Shareholder's Equity 120,541,089 159,281,837 133,991,916
Total Liabilities 214,812,670 347,310,022 459,079,014
and Shareholder's Equity
Ⅵ. RISK FACTORS
Refer to III - 1. Summary of the Business
Ⅶ. MANAGEMENT
Full-time Name Position Assigned Task
/ Part-time
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 KyungKen Yuk Vice President and Director General Management
Part-time JeongWoo Byun Auditor, Outside Director Outside Director
Part-time KeunHo Cho 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 3,919,274 28.12%
and 11 people with a special relationship
HANATOUR INC. 549,253 3.94%
Ⅸ. CURRENT STATUS OF INVESTMENTS
1. Domestic
Name of the Company Ownership Company Ownership Ratio (%) No. of Shares
Hanatour Business Service Inc. HANATOUR Service Inc. 100.00 400,000
Hana Tourist Inc. HANATOUR Service Inc. 30.23 906,981
Hanatour Jeju Service Inc. HANATOUR Service Inc. 77.35 618,830
Hanatour ITC Service Inc. HANATOUR Service Inc. 100.00 24,400,000
Tour Marketing Korea Service Inc. HANATOUR Service Inc. 70.00 140,000
OK Tour Service Inc. HANATOUR Service Inc. 48.92 9,784
Web Tour Service Inc. HANATOUR Service Inc. 76.99 8,777,380
Nextour Co., Ltd. Web Tour Service Inc. 100.00 40,000
Hotel&Air Co., Ltd. HANATOUR Service Inc. 50.00 300,000
Gyoyugyeohaeng Co., Ltd HANATOUR Service Inc. 19.90 398,000
Mark Hotel Co., Ltd. HANATOUR Service Inc. 100.00 40,000,000
Hana Finance Service Inc. HANATOUR Service Inc. 100.00 3,400,000
SM duty free Co., Ltd. HANATOUR Service Inc. 90.13 12,325,387
Triple Corp. HANATOUR Service Inc. 3.84 6,000
CELINO INC HANATOUR Service Inc. 50.00 300,000
K Culture Industry Co., Ltd. HANATOUR Service Inc. 40.00 -
Hani Tour Inc. HANATOUR Service Inc. 9.54 19,078
SAM Consulting Co.,Ltd. HANATOUR Service Inc. 7.69 1,667
KC HOSPITALITY CO.,LTD HANATOUR Service Inc. 10.00 57,600
Jeju Channel Inc. Hanatour Jeju Service Inc. 8.06 50,000
Dream Co., Ltd. HANATOUR Service Inc. 2.08 2,250
Hanatour Jeju Service Inc. 2.08 2,250
2. Overseas
Name of the Company Ownership Company Region Ownership Ratio (%) No. of Shares
Hanatour USA Inc. HANATOUR Service Inc. LA 100.00 350,000
Hanatour Europe Ltd. HANATOUR Service Inc. London 70.00 4,200
Hanatour Japan Co., Ltd. HANATOUR Service Inc. Japan 53.98 6,836,300
U.I Sightseeing Bus LLC HANATOUR JAPAN CO., LTD Japan 100.00 1,900
Hanatour CHINA HANATOUR Service Inc. China 100.00 -
Hanatour PTY. Ltd. HANATOUR Service Inc. Australia 100.00 600,000
Hanatour HongKong Co., Ltd. HANATOUR Service Inc. Hong Kong 100.00 5,000,000
Hanatour Europe s.r.l HANATOUR Service Inc. Italy 50.00 5,250
Allegrox TM Hotel HANATOUR JAPAN CO., LTD Japan 100.00 396
Star Shop&Line HANATOUR JAPAN CO., LTD Japan 100.00 1,800
Beijing Hana Information Technology Co., Ltd. HANATOUR Service Inc. China 100.00 -
Hanatour Service (M) Sdn.Bhd. HANATOUR Service Inc. Malaysia 100.00 1,500,000
Hanatour Janpan System Vietnam HANATOUR JAPN CO., LTD Vietnam 100.00 -
HANATOUR EU GMBH HANATOUR Service Inc. Germany 100.00 -
CAMLAO HANATOUR CO., LTD. HANATOUR Service Inc. Cambodia 100.00 300,000
HANATOUR VIETNAM COMPANY LIMITED HANATOUR Service Inc. Vietnam 85.00 -
HANATOUR PHILIPPINES CORP. HANATOUR Service Inc. Philippines 97.54 1,267,980
VISION TOUR, INC. Hanatour USA Inc. LA 100.00 300,000
HNT ITALIA - SOCIETA' A HANATOUR Service Inc. Roma 51.00 -
RESPONSABILITA' LIMITATA
Ⅹ. MAJOR CREDITORS
Not applicable.
XI. IMPORTANT EVENTS AFTER THE SETTLEMENT OF
ACCOUNTS PERIOD
(1) CAMLAO HANATOUR CO., LTD. which is one of subsidiaries of the Group
resolved to dissolve on January 26, 2022.
(2) CELINO INC which is one of subsidiaries of the Group resolved to dispose
on February 14, 2022.
XII. OTHER IMPORTANT FACTS ABOUT THE BUSINESS
None.
Independent Auditors' Report
Based on a report originally issued in Korean
To the Shareholders and Board of Directors of
Hanatour Service Inc.:
Opinion
We have audited the consolidated financial statements of Hanatour Service Inc.
and its subsidiaries (the "Group"), which comprise the consolidated statements
of financial position as of December 31, 2021 and 2020, the consolidated
statements of comprehensive income (loss), changes in equity and cash flows
for the years then ended, and notes, comprising a summary of significant
accounting policies and other explanatory information.
In our opinion, the accompanying consolidated financial statements present
fairly, in all material respects, the consolidated financial position of the
Group as of December 31, 2021 and 2020, and its consolidated financial
performance and its consolidated cash flows for the years then ended in
accordance with Korean International Financial Reporting Standards ("K-IFRS").
Basis for Opinion
We conducted our audits in accordance with Korean Standards on Auditing
(KSAs). Our responsibilities under those standards are further described in
the Auditors' Responsibilities for the Audit of the Consolidated Financial
Statements section of our report. We are independent of the Group in
accordance with the ethical requirements that are relevant to our audit of the
consolidated financial statements in Republic of Korea, and we have fulfilled
our other ethical responsibilities in accordance with these requirements. We
believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.
Responsibilities of Management and Those Charged with Governance for the
Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the
consolidated financial statements in accordance with K-IFRS, and for such
internal control as management determines is necessary to enable the
preparation of consolidated financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible
for assessing the Group's ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using the going concern
basis of accounting unless management either intends to liquidate the Group or
to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Group's
financial reporting process.
Auditors' Responsibilities for the Audit of the Consolidated Financial
Statements
Our objectives are to obtain reasonable assurance about whether the
consolidated financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditors' report
that includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in accordance with
KSAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these
consolidated financial statements.
As part of an audit in accordance with KSAs, we exercise professional judgment
and maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated
financial statements, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order
to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the Group's
internal control.
• Evaluate the appropriateness of accounting policies used in the
preparation of the consolidated financial statements and the reasonableness of
accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management's use of the going concern
basis of accounting and, based on the audit evidence obtained, whether a
material uncertainty exists related to events or conditions that may cast
significant doubt on the Group's ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention
in our auditors' report to the related disclosures in the consolidated
financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the
date of our auditors' report. However, future events or conditions may cause
the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the
consolidated financial statements, including the disclosures, and whether the
consolidated financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial
information of the entities or business activities within the Group to express
an opinion on the consolidated financial statements. We are responsible for
the direction, supervision and performance of the group audit. We remain
solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other
matters, the planned scope and timing of the audit and significant audit
findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide those charged with governance with a statement that we have
complied with relevant ethical requirements regarding independence, and
communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with those charged with governance, we determine
those matters that were of most significance in the audit of the consolidated
financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditors' report unless law or
regulation precludes public disclosure about the matter or when, in extremely
rare circumstances, we determine that a matter should not be communicated in
our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditors'
report is Jung Wook Do.
KPMG Samjong Accounting Corp.
Seoul, Korea
March 17, 2022
This report is effective as of March 17, 2022, the audit report date. Certain
subsequent events or circumstances, which may occur between the audit report
date and the time of reading this report, could have a material impact on the
accompanying consolidated financial statements and notes thereto. Accordingly,
the readers of the audit report should understand that the above audit report
has not been updated to reflect the impact of such subsequent events or
circumstances, if any.
HANATOUR SERVICE INC. AND SUBSIDIARIES
Consolidated Statements of Financial Position
As of December 31, 2021 and 2020
(In thousands of won) 2021 2020
Assets
Cash and cash equivalents W 105,686,896 101,851,025
Short-term financial instruments 17,109,692 18,114,794
Trade receivables 11,253,911 9,315,225
Other receivables 4,105,493 9,169,709
Finance lease receivables 449,764 2,137,718
Inventories 1,711,235 2,013,920
Advance payments 11,664,075 9,797,848
Other current assets 2,456,982 3,529,004
Other financial assets 11,437,194 5,123,578
Current tax assets 332,808 633,823
Assets held for sale - 46,402,958
Current financial assets at FVTPL - 236,154
Total current assets 166,208,050 208,325,756
Non-current financial assets at FVTPL 2,938,115 4,529,550
Financial assets at FVOCI 1,187,148 1,207,318
Investments in associates and joint ventures 946,873 3,099,867
Long-term finance lease receivables - 1,336,082
Long-term other receivables 3,363,839 1,328,850
Investment property, net 1,396,521 8,498,609
Property and equipment, net 13,379,039 98,387,081
Right-of-use assets 140,108,105 263,965,044
Intangible assets 32,852,801 41,958,023
Other financial assets 20,293,002 28,196,140
Deferred tax assets 47,721,079 42,376,646
Other non-current assets 201,012 51,949
Total non-current assets 264,387,534 494,935,159
Total assets W 430,595,584 703,260,915
HANATOUR SERVICE INC. AND SUBSIDIARIES
Consolidated Statements of Financial Position, Continued
As of December 31, 2021 and 2020
(In thousands of won) 2021 2020
Liabilities
Trade payables W 8,887,001 7,021,596
Other payables 57,384,884 61,872,256
Income tax payables 304,682 448,134
Deposits received for travel 8,068,636 6,236,819
Advances received 26,119,418 26,524,195
Short-term borrowings 16,563,494 23,900,152
Current portion of long-term borrowings 4,122,122 6,816,375
Finance lease liabilities 35,112,340 22,784,004
Provisions 1,023,018 2,142,207
Other financial liabilities 2,217,777 2,325,020
Other current liabilities 12,719,477 13,191,064
Total current liabilities 172,522,849 173,261,822
Long-term other payables 463,288 6,376,512
Long-term borrowings 10,527,204 94,865,826
Debentures 102,385 311,242
Long-term provisions 181,744 433,008
Long-term finance lease liabilities 182,746,487 299,760,033
Provision for long-term employee benefits 1,023,381 2,316,695
Other financial liabilities - 475,680
Other non-current liabilities 5,272,119 146,106
Total non-current liabilities 200,316,608 404,685,102
Total liabilities 372,839,457 577,946,924
Equity
Capital stock 6,969,593 6,969,593
Other contributed capital 29,905,656 205,366,093
Components of other capital 1,947,292 2,210,944
Retained earnings 46,504,986 (79,507,585)
Equity attributable to the owners of 85,327,527 135,039,045
the Parent Company
Non-controlling interests (27,571,400) (9,725,054)
Total equity 57,756,127 125,313,991
Total liabilities and equity W 430,595,584 703,260,915
HANATOUR SERVICE INC. AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income (Loss)
For the years ended December 31, 2021 and 2020
(In thousands of won, except earnings per share data) 2021 2020
Operating revenue W 40,258,282 109,571,614
Operating expense 167,551,792 224,438,313
Bad debt expense 1,907,047 13,343,343
Other operating expense 165,644,745 211,094,970
Operating income (127,293,510) (114,866,699)
Interest income by effective interest method 1,173,029 1,875,972
Other financial income 12,622 391,404
Financial expense 8,594,071 9,064,506
Loss from investment in associates and joint ventures (99,510) (4,137,405)
Other income 110,530,654 11,708,098
Other expense 47,730,324 74,710,136
Other bad debt expense 3,304,424 718,002
Income (loss) before income taxes (75,305,534) (189,521,274)
Income taxes of continuing operations (4,768,524) (30,709,687)
Net loss W (70,446,260) (218,571,040)
Net loss from continuing operations (70,537,010) (158,811,587)
Net loss from discontinued operations 90,750 (59,759,453)
Other comprehensive income after tax expense 740,869 3,193,888
Items that will never be reclassified to profit of loss:
Loss on valuation financial assets at FVOCI (98,639) (70,117)
Items that are or may be reclassified subsequently
to profit of loss:
Changes in valuation of equity-accounted investees, net - -
Gain on foreign operations translation, net 839,507 3,264,005
Total comprehensive income (loss) W (69,705,391) (215,377,152)
Net income (loss) attributable to:
Owners of the Parent Company (43,987,430) (172,012,334)
Non-controlling interests (26,458,830) (46,558,706)
W (70,446,260) (218,571,040)
Comprehensive income (loss) attributable to:
Owners of the Parent Company (43,678,822) (170,353,428)
Non-controlling interests (26,026,569) (45,023,724)
W (69,705,391) (215,377,152)
Earnings (losses) per share
Basic earnings (losses) per share attributable to (in won) : (3,285) (13,210)
Continuing operation (in won) (3,288) (9,232)
Discontinued operation (in won) 3 (3,978)
Diluted earnings (losses) per share attributable to (in won) : W (3,285) (13,210)
Continuing operation (in won) (3,288) (9,232)
Discontinued operation (in won) 3 (3,978)
HANATOUR SERVICE INC. AND SUBSIDIARIES
Consolidated Statements of Changes in Equity
For the years ended December 31, 2021 and 2020
(In thousands of won) Capital Stock Other contributed capital Components of other capital Retained earnings Non-controlling interests Total shareholders' equity
January 1, 2020 W 5,808,093 77,487,067 538,389 96,937,522 37,108,377 217,879,448
Dividends - - - (4,426,772) - (4,426,772)
Dividends of subsidiaries - - - - (1,751,550) (1,751,550)
Stock compensation expense - 117,236 - - 109,947 227,183
Net loss - - - (172,012,334) (46,558,706) (218,571,040)
Gain on foreign operations - - 1,713,558 - 1,550,447 3,264,005
translation
Loss on valuation financial - - (54,652) - (15,465) (70,117)
assets at FVOCI
Acquisition of treasury stock - (91) - - - (91)
Paid-in capital increase of 1,161,500 127,765,000 - - - 128,926,500
Parent company
Paid-in capital increase of - (3,119) - - 3,119 -
Subsidiaries
Changes in scope of consolidation - - 13,649 - (171,224) (157,575)
December 31, 2020 W 6,969,593 205,366,093 2,210,944 (79,507,584) (9,725,055) 125,313,991
January 1, 2021 W 6,969,593 205,366,093 2,210,944 (79,507,584) (9,725,055) 125,313,991
Net loss - - - (43,987,430) (26,458,830) (70,446,260)
Gain on foreign operations - - 384,299 - 455,208 839,507
translation
Gain on valuation financial - - 9,528 - - 9,528
assets at FVOCI
Loss on valuation financial - - (85,219) - (22,947) (108,166)
assets at FVOCI
Introduction of capital surplus - (170,000,000) - 170,000,000 - -
Acquisition of treasury stock - (534) - - (310) (844)
Acquisition of investing stock - - - - 2,317,404 2,317,404
Paid-in capital increase of - (5,522,994) - - 9,524,734 4,001,740
Subsidiaries
Changes in scope of consolidation - 63,091 (572,260) - (3,661,604) (4,170,773)
December 31, 2021 W 6,969,593 29,905,656 1,947,292 46,504,986 (27,571,400) 57,756,127
HANATOUR SERVICE INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
For the years ended December 31, 2021 and 2020
(In thousands of won) 2021 2020
Cash flows from operating activities
Net loss W (70,446,260) (218,571,040)
Additions of expenses not involving cash outflows and others 97,422,910 157,573,133
Deduction of incomes not involving cash inflows and others (108,779,131) (6,077,486)
Movements in operating assets and liabilities:
Decrease (increase) in trade receivables (1,361,937) 72,070,031
Decrease in other receivables 2,725,948 2,726,123
Decrease in inventories 2,494 28,683,518
Decrease (increase) in advance payments (8,527,408) 22,781,087
Decrease in other current assets 1,070,342 6,201,879
Increase in other non-current assets (162,291) (21,345)
Increase (decrease) in trade payables 1,540,475 (59,455,334)
Decrease in other payables (17,153,030) (29,127,075)
Increase (decrease) in deposits received for travel 1,830,804 (89,194,333)
Increase in advances received 2,405 4,237,517
Decrease in other financial liabilities (110,315) (433,003)
Decrease in other current liabilities (844,767) (11,924,107)
Decrease in provisions (595,758) (1,421,352)
Decrease in long-term other payables (312,711) (398,385)
Decrease in other long-term employee benefit (324,900) (29,340)
(104,023,130) (122,379,512)
Interest expense paid (4,338,649) (8,658,314)
Interest income received 1,101,003 1,923,042
Dividend income received - 553,872
Income taxes paid (28,930) (4,307,113)
Net cash provided by operating activities W (107,289,706) (132,868,025)
HANATOUR SERVICE INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows, Continued
For the years ended December 31, 2021 and 2020
(In thousands of won) 2021 2020
Cash flows from investing activities
Cash inflows from investing activities:
Decrease in short-term financial instruments W 19,923,883 198,366,449
Decrease in other receivables 247,390 11,964
Disposal of financial assets at FVTPL 1,165,183 1,813,578
Disposal of investment in associates and joint venture 162,722 200,995
Disposal of financial assets at FVOCI - 14,000
Disposal of property and equipment 308,437 5,798,643
Disposal of intangible assets 11,517 -
Disposal of intangible assets being acquired - 35,401
Decrease in finance lease receivables 211,479 1,272,889
Decrease in other financial assets 11,332,739 14,673,913
Disposal of assets held for sale 211,178,338 3,500,000
Cash outflows for
investing activities:
Increase in short-term financial instruments 16,676,202 106,460,284
Increase in other receivables 403,294 1,477,276
Acquisition of financial assets at FVTPL 250,000 750,000
Acquisition of financial assets at FVOCI - 221
Acquisition of property and equipment 2,544,706 4,042,829
Acquisition of intangible assets 2,031,228 16,971,962
Increase in other financial assets 2,974,553 8,951,556
Net cash used in investing activities W 219,661,705 87,033,704
HANATOUR SERVICE INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows, Continued
For the years ended December 31, 2021 and 2020
(In thousands of won) 2021 2020
Cash flows from financing activities
Cash inflows from financing activities:
Proceeds from short-term borrowings W 55,724,965 107,240,149
Proceeds from long-term borrowings 1,281,219 12,708,305
Paid-in capital increase of parent company - 128,926,500
Paid-in capital increase of subsidiaries 4,001,740 -
Proceeds from leasehold deposits received 110,457 -
Cash outflows for financing activities:
Repayment of short-term borrowings 62,722,484 176,660,646
Repayment of current portion of long-term borrowings 6,614,496 2,300,535
Repayment of long-term borrowings 81,570,000 1,105,070
Repayment of finance lease liabilities 16,130,912 23,406,065
Payment of cost of stock issuing 74,841 6,338
Acquisition of treasury stocks 1,083 -
Payment of dividends 2,972,884 7,453,827
Payment of leasehold deposits received 419,879 -
Net cash provided by financing activities (109,388,198) 37,942,473
Increase (decrease) in cash on changes in scope of consolidation 641,277 (18,657)
Net decrease in cash and cash equivalents 3,625,078 (7,910,505)
Cash and cash equivalents at beginning of year 101,851,025 110,846,773
Effect of exchange rate change 210,794 (1,085,243)
Cash and cash equivalents at end of year W 105,686,896 101,851,025
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