Property and equipment

12 Months Ended

Dec. 31, 2025

20. Property and equipment

A.	Reconciliation of carrying amount

Details of property and equipment as of December 31, 2025 and 2024 are as follows:


		December 31, 2025
		Book value		Accumulated depreciation			Accumulated impairment loss			Carrying amount
Machinery	₩		2,097,807		(1,114,048	)		-			983,759
Vehicles			319,130		(272,138	)		-			46,992
Office equipment			591,900		(400,167	)		-			191,733
Furniture and fixtures			3,276,043		(1,700,947	)		(425,252	)		1,149,844
Right-of-use assets			9,271,720		(4,219,540	)		(369,280	)		4,682,900
Total	₩		15,556,600		(7,706,839	)		(794,532	)		7,055,228

		December 31, 2024
		Book value		Accumulated depreciation			Accumulated impairment loss			Carrying amount
Machinery	₩		2,601,550		(1,078,409	)		-			1,523,141
Vehicles			51,419		(51,418	)		-			1
Office equipment			559,571		(343,099	)		-			216,472
Construction-in-progress			8,662		-			-			8,662
Furniture and fixtures			4,401,909		(1,787,018	)		(748,162	)		1,866,729
Right-of-use assets			13,716,930		(5,065,483	)		(216,464	)		8,434,983
Total	₩		21,340,041		(8,325,427	)		(964,626	)		12,049,988

Details of the changes in property and equipment for the years ended December 31, 2025, 2024 and 2023 are as follows:


		2025
		Machinery			Vehicles			Office equipment			Construction-in-progress			Furniture and fixture			Right-of- use assets			Total
		(In thousands of Korean won)
Beginning balance	₩		1,523,141			1			216,472			8,662			1,866,729			8,434,983			12,049,988
Changes in scope of consolidation			-			22,733			61,881			-			43,229			528,894			656,737
Acquisitions			40,520			3,826			47,787			-			20,800			452,612			565,545
Depreciation			(264,984	)		(29,061	)		(84,062	)		-			(350,174	)		(1,623,732	)		(2,352,013	)
Disposals			(319,496	)		-			(51,828	)		(2,600	)		(430,740	)		-			(804,664	)
Transfer (*1)			4,578			49,493			1,483			(6,062	)		-			(1,953,094	)		(1,903,602	)
Impairment loss (*2)			-			-			-			-			-			(152,816	)		(152,816	)
Lease modification			-			-			-			-			-			190,705			190,705
Lease termination			-			-			-			-			-			(1,194,651	)		(1,194,651	)
Ending balance	₩		983,759			46,992			191,733			-			1,149,844			4,682,900			7,055,228

	(*1)	For the year ended December 31, 2025, the Company reclassified Right-of-use assets associated with five stores to investment properties as the Company decided to sublease the right-of-use asset to a third party. (Note 18)
	(*2)	The Company identified each bakery-café store as a CGU. An impairment loss of 152,816 thousand won was recognized for the Sidus store.

		2024
		Machinery			Vehicles			Office equipment			Construction- in-progress		Furniture and fixture			Right-of-use assets			Total
		(In thousands of Korean won)
Beginning balance	₩		1,828,022			2			283,292			-		3,330,540			9,425,821			14,867,677
Acquisitions			42,801			46,057			13,919			8,662		161,780			419,934			693,153
Depreciation			(322,641	)		(1,535	)		(80,739	)		-		(569,932	)		(1,404,058	)		(2,378,905	)
Disposals			(25,041	)		(44,523	)		-			-		(307,497	)		-			(377,061	)
Transfer (*1)			-			-			-			-		-			2,385,812			2,385,812
Impairment loss (*2)			-			-			-			-		(748,162	)		(216,464	)		(964,626	)
Lease modification			-			-			-			-		-			(1,603,440	)		(1,603,440	)
Lease termination			-			-			-			-		-			(572,622	)		(572,622	)
Ending balance	₩		1,523,141			1			216,472			8,662		1,866,729			8,434,983			12,049,988

	(*1)	As of December 31, 2023, the right-of-use assets associated with six stores were reclassified as investment properties. For the year ended December 31, 2024, five of these investment properties were reclassified back to right-of-use assets due to a change in intended use, as the Company determined to utilize the properties for its own operations (Note 18).
	(*2)	An impairment loss was recognized due to the discontinuation of operations at six stores.

		2023
		Machinery			Vehicles			Office equipment			Construction- in-progress			Furniture and fixture			Right-of-use assets			Total
		(In thousands of Korean won)
Beginning balance	₩		2,041,579			4,075			276,711			9,950			3,207,619			15,089,571			20,629,505
Acquisitions			172,534			-			92,819			-			684,228			578,409			1,527,990
Depreciation			(345,202	)		(4,074	)		(86,238	)		-			(559,061	)		(1,704,081	)		(2,698,656	)
Disposals			(50,839	)		-			-			-			-			-			(50,839	)
Transfer (*1)			9,950			1			-			(9,950	)		-			(3,483,372	)		(3,483,371	)
Impairment loss (*2)			-			-			-			-			(2,246	)		-			(2,246	)
Lease modification			-			-			-			-			-			(45,282	)		(45,282	)
Lease termination			-			-			-			-			-			(1,009,424	)		(1,009,424	)
Ending balance	₩		1,828,022			2			283,292			-			3,330,540			9,425,821			14,867,677

	(*1)	For the year ended December 31, 2023, the Group transferred Right-of-use assets to investment properties because the Group decided to lease the building to a third party. (Note 18)
	(*2)	The Group identified each bakery-café store as CGU and recognized impairment loss to bakery-café stores located in Garosu-gil and Jamwon.

The classification of depreciation expenses in the statements of comprehensive income for the years ended December 31, 2025, 2024 and 2023 are as follows:


		2025		2024		2023
		(In thousands of Korean won)
Cost of revenues	₩		1,367,703		1,970,417		2,318,730
Selling, general and administrative expenses			984,310		408,488		379,926
Total	₩		2,352,013		2,378,905		2,698,656