Part 7 · Hands-on: read it and judge for yourself · Lesson 36
Practice: reading a real business report together
It is time to apply what you have learned to real reports. We read the annual reports of the semiconductor company SK Hynix and the bank Kookmin Bank together, following the table of contents.
QToday's question
If you lay a semiconductor company's and a bank's annual reports side by side, can you read them the same way?
The big framework of the table of contents is the same. But open a bank's report and there is neither "revenue" nor "cost of goods sold," and the debt-to-equity ratio is over 1,000%. In this lesson, you practice the reading order you have learned so far on SK Hynix, and confirm for yourself with Kookmin Bank that "in a different industry, the names and yardsticks of the numbers differ too."
MAPLearning map for this lesson
We build it up in three steps. At the end of each step, a 'Quick check' lets you test your understanding before moving on.
In Lesson 5 you learned the annual report's table of contents and the 10-minute skim order. We now slot in the tools learned in Parts 2–5 one by one: Lesson 10 debt-to-equity and current ratios, Lesson 14 operating margin, Lesson 20 FCF, Lesson 23 ROE, Lesson 25 dividends, "banks need a different yardstick" from Lesson 26, and the audit opinion from Lesson 30. For how banks make money, recall Learn (Economics) Lesson 18 (loan-deposit spread and NIM).
- STEP 1 · Basic conceptsSK Hynix: a 10-minute read in table-of-contents order
Skim a manufacturer's annual report using the 10-minute order from Lesson 5, and find and calculate revenue, operating margin, debt-to-equity ratio, FCF, dividends and the audit opinion from the original text.
- STEP 2 · Understanding the mechanicsKookmin Bank: how does a bank report differ?
Match , , net interest income and to the lines they correspond to in a manufacturer.
- STEP 3 · Applying itComparing the two companies in a one-page note
Pick the yardsticks that suit the industry (the and instead of the debt-to-equity ratio) and summarize the two companies neutrally.
This is an educational reading exercise. The two companies are real companies chosen by the user and are used only as practice material for reading original disclosures. We do not rate either company as good or bad, and we do not recommend buying or selling any particular stock. The numbers are based on the original 2025 annual reports, and the ratios were calculated by Robin Invest from the original numbers.
STEP 1SK Hynix: a 10-minute read in table-of-contents order
Apply the 10-minute order from Lesson 5 directly to a real report. If you decide only "what I came to check" in each chapter, you won't get lost even in a thick report.
Search for SK Hynix on DART and open the periodic disclosure Annual report (Dec 2025) (filed March 17, 2026). Next to the cover there is a note saying "This report includes the consolidated portion," so, as you learned in Lesson 11, look at the consolidated numbers first. The order is exactly the 10-minute map from Lesson 5.
Easy analogy · a big supermarket you visit for the first time
Even a supermarket you've never visited has a floor guide that looks similar: food in the basement, appliances on the upper floors. Annual reports have the same table of contents across companies, so once you've learned the guide, you can shop through any company in the same order.
1 II. Business Overview (2 min). Open "2. Main products and services" and the revenue table is a single line: semiconductor segment, DRAM, NAND Flash and others, KRW 97.15 trillion (100%). Lesson 28 told you to look at the revenue mix, but this company does not break out amounts by product. Instead, the "price trend" text explains that "with the spread of AI, demand for general DRAM as well as HBM increased greatly." If there is no table, look for the reason in the text is the first exercise.
2 III-1. Summary financial information (3 min). Three years are in one table. Revenue goes KRW 32.8 trillion → 66.2 trillion → 97.1 trillion, and operating profit −KRW 7.7 trillion → 23.5 trillion → 47.2 trillion. As learned in Lesson 27, look at the trend rather than a single year. Going from a loss in 2023 to an operating margin of about 48.6% in two years shows in numbers how widely the semiconductor price cycle seen in Lessons 3 and 13 can swing.
3 III-2. Consolidated financial statements (3 min). From the balance sheet, find the debt-to-equity and current ratios, and from the cash flow statement, find operating cash flow and "acquisition of property, plant and equipment" to calculate FCF. Switch the tabs in the figure below to see the three statements in turn.
Source: SK Hynix annual report (Dec 2025), receipt no. 20260317000635, III-1 Summary consolidated financial information and III-2-4 Consolidated cash flow statement (converted from KRW million to KRW trillion). Operating margin, debt-to-equity ratio, current ratio, FCF and ROE were calculated by Robin Invest from the original numbers. Net income is on a basis of equity attributable to owners of the parent. Checked 2026-10-08.
4 III-6. Dividends (1 min). The report states that the 2025 cash dividend per share was KRW 3,000 (KRW 375 each quarter, three times, plus a year-end dividend), total dividends KRW 2.095 trillion, consolidated cash payout ratio 4.9%, and dividend yield 0.4%. Verifying with the method in Lesson 25, the KRW 2.1 trillion dividend is about 4.9% of the KRW 42.9 trillion profit attributable to owners of the parent. You can also read that, because earnings grew so much, the payout ratio number became small.
5 V. Audit opinion, VII. Shareholders (1 min). The auditor is Samjong KPMG, with an unqualified opinion on both consolidated and separate statements and "not applicable" for going-concern uncertainty. The you learned about in Lesson 30 include "review of the appropriateness of the depreciation start date for machinery." This means that when a company begins to spread the cost of factory equipment as an expense (depreciation, Lesson 7) is large enough to affect profit. The largest shareholder in Chapter VII is SK Square Co., Ltd., with a 20.07% stake.
Quick checkSK Hynix's 2025 operating cash flow was KRW 53.4 trillion and acquisition of property, plant and equipment was KRW 27.5 trillion. What is FCF, and how many times the total dividend (KRW 2.1 trillion) is it?
STEP 2Kookmin Bank: how is a bank's report different?
When you open a bank's report, the familiar lines disappear. There is no revenue and no cost of goods sold, and the debt-to-equity ratio is above 1,000%. Once you pin down what a bank actually buys and sells, the unfamiliar numbers quickly fall into place.
First, one thing to check. Kookmin Bank is not a listed company. If you search for Kookmin Bank on DART, the market classification shows 'Other corporation', and Chapter VII lists the largest shareholder as KB Financial Group, with a 100.0% stake. What trades on the stock market is the holding company KB Financial ( from Lesson 11). Even so, Kookmin Bank has issued bonds and other securities, so it files its own annual report. For this exercise we read the user's pick: Kookmin Bank's own annual report (December 2025, the final version including the corrected filing). For reference, Kookmin Bank's profit attributable to owners of the parent of KRW 3.85 trillion is about 66% of KB Financial's consolidated profit attributable to owners of the parent of KRW 5.83 trillion (a simple division of the two reports' figures, with no separate adjustment for intra-group transactions).
Easy analogy · a shop that sells money
A bakery buys flour and sells bread. A bank buys 'money' and sells 'money'. It pays depositors interest to borrow their money (buying it), then lends that money out at a higher interest rate (selling it). So a bank's 'inventory' is its loans, and its 'raw material cost' is deposit interest.
Hold this analogy up against the financial statements and you can see why the numbers look different. In Kookmin Bank's consolidated balance sheet at the end of 2025, are KRW 429 trillion (about 73%) of KRW 585 trillion in assets, and are KRW 440 trillion of KRW 546 trillion in liabilities. Deposits that customers leave with the bank are money it must eventually return, so they are booked as liabilities. That is why the debt-to-equity ratio comes out at 546 ÷ 39 ≈ about 1,400%. As explained in Lesson 26, this number is not a warning sign for a bank but simply the structure of the industry.
The left side is a manufacturer (SK Hynix) and the right side is a bank (Kookmin Bank), showing lines that play the same role. The pairing is a simplification to aid understanding and does not mean they are the same item in accounting terms. Sources: SK Hynix annual report (20260317000635), Kookmin Bank [corrected] annual report (20260814002787) III-1, II-2, II-5, IV; 2025 consolidated basis (NIM and soundness indicators are on the bank's standalone basis). Checked 2026-10-08.
The income statement reads the same way. Interest income, the bank's equivalent of 'revenue', is KRW 21.9 trillion; subtracting KRW 11.2 trillion of interest expense paid to depositors and others leaves net interest income of KRW 10.7 trillion. The loan-deposit spread you saw in Learn (Economics) Lesson 18 is exactly this line. In Chapter II, 'Operating status', Kookmin Bank reports an average interest rate of 4.05% on KRW loans, 2.05% on KRW deposits and a of 1.74%. NIM has been falling, from 1.83% in 2023 to 1.78% in 2024, and the management discussion in Chapter IV attributes this to "the impact of policy rate cuts". It is a passage where the report itself tells you how interest rates reach a bank's earnings.
There is one more important cost that only banks have: the , an amount booked as an expense in advance to cover loans that may go unpaid. Kookmin Bank booked KRW 1.61 trillion in 2023, KRW 0.68 trillion in 2024 and KRW 1.03 trillion in 2025. If this line jumps, read it as a sign the bank is preparing for worse economic conditions. The allowance for doubtful accounts from Lesson 7 becomes a core expense line for a bank.
Common misconceptions
"A 1,400% debt-to-equity ratio means the bank is about to collapse?" No. Because deposits are booked as liabilities, banks naturally have very high debt-to-equity ratios. A bank's safety is judged by the and the .
"Can you compare banks by operating margin too?" A bank has no 'revenue' line, so the same kind of margin is awkward. Compare them with bank-specific numbers such as net interest income, NIM, the size of provisions and ROE.
"If you read Kookmin Bank's report, do you know all of KB Financial's stock?" No. KB Financial also has other subsidiaries such as securities, insurance and card businesses. The bank's report is only a large piece of the holding company's results, and you need to read the listed KB Financial's own annual report separately to see the whole picture.
Quick checkWhich line is closest to a bank's 'raw material cost'? Choose from deposits, interest expense and general administrative expenses.
STEP 3Comparing the two companies on a one-page note
Now let's gather the numbers we found in both reports on one page. This is practice in writing only 'observations' with yardsticks suited to each industry, without passing judgment.
The principle of comparison is the same as in Lesson 26. Don't force numbers with the same name into the same box; choose the yardstick that fits the industry. The table below is a preview of the 'one-page note' you will build in Lesson 37.
| Box | SK Hynix (manufacturer) | Kookmin Bank (bank) |
|---|---|---|
| How it makes money | Sales of memory chips (DRAM, NAND); revenue KRW 97.1 trillion | Funds itself with deposits and lends; net interest income KRW 10.7 trillion + net fee income KRW 1.2 trillion |
| Growth (3 years) | Revenue KRW 32.8 → 66.2 → 97.1 trillion | Net interest income KRW 9.87 → 10.22 → 10.66 trillion |
| Profitability | Operating margin about 48.6%, ROE about 35.6% | NIM 1.74%, ROE about 9.9% |
| Safety | Debt-to-equity ratio about 46%, current ratio about 186% | BIS total capital ratio 17.28%, NPL ratio 0.28%, delinquency rate 0.28% |
| Cash and shareholder returns | FCF about KRW 25.9 trillion, dividend per share KRW 3,000, payout ratio 4.9% | Total dividends KRW 1.94 trillion (shareholder: KB Financial Group), payout ratio 50.28% |
| Shareholders and disclosure | Largest shareholder SK Square 20.07%, audit opinion unqualified | KB Financial Group 100%, audit opinion unqualified (Samil PwC) |
ROE is based on year-end equity attributable to owners of the parent; the debt-to-equity ratio, current ratio and FCF are on a consolidated basis, calculated by Robin Invest. Kookmin Bank's dividend yield is shown as '-' in the report because it is unlisted. Sources are the same as in the figure above.
Be careful when reading the table. If you place SK Hynix's ROE of 35.6% next to Kookmin Bank's 9.9% and say "semiconductors are better", you are repeating the mistake from Lesson 26. Semiconductors are an industry whose profits swing widely with the cycle (a loss in 2023), while banks steadily accumulate low margins at large scale. The reason these are written in the same row is not to compare them, but to ask where each stands by the standards of its own industry. For a semiconductor company, the next question is "where in the cycle is this margin?" (Lesson 27); for a bank, it is "how do provisions move when NIM falls?"
Finding it yourself on DART: two reports with different tables of contents
12. Major products and services
3. Raw materials and production facilities
4. Sales and orders
5. Risk management and derivatives
6. Major contracts and R&D activities
7. Other reference matters
22. Operating status (NIM, interest income and expense)
3. Derivatives transactions
4. Business facilities
35. Financial soundness and other reference matters (BIS, delinquency, NPL)
Illustrative screen. The actual table-of-contents names of the two annual reports are reproduced as they are (checked on DART 2026-10-08).
1 For a manufacturer, look at products and sales in II-2 and II-4. 2 For a bank, II-2 'Operating status' has the average interest rates on loans and deposits, NIM, and results by segment (interest and fees). 3 II-5 'Financial soundness and other reference matters' lays out the BIS total capital ratio, liquidity coverage ratio, , NPL ratio and (206.01%) for three years. For a bank report, opening this chapter first is the shortcut. Chapters III (financials), V (audit) and VII (shareholders) are in the same place in both companies' reports.
How to use it in investing
| When reading this kind of company | Numbers to look at first | Where to look together |
|---|---|---|
| Cyclical manufacturers | 3–5 years of revenue and operating margin, inventory, capital expenditure | Lesson 27 trends, Lesson 20 FCF, Learn (Economics) Lesson 31 |
| Banks | NIM, provisions for credit losses, BIS ratio, NPL ratio | II-2 and II-5, Learn (Economics) Lesson 18 |
| Reports of unlisted subsidiaries | Who the listed parent is, and its ownership percentage | Chapter VII, Lesson 11 consolidation and holding companies |
| Only one row in the sales-by-product table | The price trend discussion, Chapter IV management commentary | Lesson 28 business overview |
The numbers in this lesson are a record from the 2025 annual report at a single point in time. They may change with later quarterly reports or corrected filings (Lesson 33), and the same number can be used differently depending on the reader's question. This is only practice in studying real companies and is not a suggestion to invest in any company.
Quick checkTo quickly check 'this bank's capacity to absorb losses' in a bank's annual report, which number in which chapter would you look at?
✓What we learned today
- Annual reports share the same overall table-of-contents structure (Chapters I–XII) regardless of industry. You can use the 10-minute order from Lesson 5 as it is (II Business Overview → III Summary financials → financial statements → V Audit opinion → VII Shareholders).
- SK Hynix in 2025: revenue KRW 97.1 trillion, operating profit KRW 47.2 trillion (operating margin about 48.6%), debt-to-equity ratio about 46%, FCF about KRW 25.9 trillion, dividend per share KRW 3,000 (payout ratio 4.9%), audit opinion unqualified. All are original-report figures and Robin Invest calculations.
- At a bank, customer deposits are liabilities (deposits of KRW 440 trillion) and loans are assets (loans receivable of KRW 429 trillion). So Kookmin Bank's debt-to-equity ratio comes out at about 1,400%, but this is not a warning sign, just the structure of the industry.
- For banks, read net interest income (interest income − interest expense) instead of revenue, NIM instead of the cost ratio, the BIS total capital ratio instead of the debt-to-equity ratio, and the delinquency and NPL ratios instead of receivables collection. Kookmin Bank's 2025 figures are NIM 1.74%, total capital ratio 17.28% and NPL ratio 0.28%.
- Kookmin Bank is not a listed company but a subsidiary 100% owned by KB Financial Group. What trades on the stock market is the holding company KB Financial, so read the bank's report as material for looking into a large piece of the holding company's results.
This is the final lesson. In Lesson 37, you will turn the way of organizing information that you practiced today on two companies into a six-box 'one-page analysis note', so that you can read any company you meet in the same order from now on.
Quiz5-question quiz
Pick an answer and it's graded right away with an explanation.
Q1. When the 'main products' sales table in SK Hynix's annual report has only one row (semiconductors 100%), what is the appropriate next step?
If there is no table, look for the reason in the text. SK Hynix wrote in its price trend discussion that demand for HBM and general DRAM grew with the spread of AI.
Q2. What is the main reason Kookmin Bank's debt-to-equity ratio calculates to about 1,400%?
Deposits are money that must be returned, so they are liabilities. Kookmin Bank's deposits are about KRW 440 trillion. That is why banks are judged on safety by the BIS total capital ratio instead of the debt-to-equity ratio.
Q3. In a bank's income statement, which line plays the role closest to a manufacturer's 'gross profit'?
Just as you subtract raw material costs from the money from selling goods, subtracting deposit interest from the money earned as interest gives net interest income. Kookmin Bank's was KRW 10.7 trillion in 2025.
Q4. Which fact is the right one to keep in mind when reading Kookmin Bank's report?
The largest shareholder in Chapter VII is KB Financial Group at 100%. Read the bank's report as material for looking at a large piece of the holding company's results (about 66% by profit attributable to owners of the parent).
Q5. What is the most appropriate interpretation of SK Hynix's ROE of about 35.6% and Kookmin Bank's ROE of about 9.9%?
Semiconductor profits swing widely with the cycle (a loss in 2023), while banks accumulate low margins at large scale. Compare within an industry as in Lesson 26, and look at multi-year trends as in Lesson 27.
NextTerms · Next lesson · Related tools
Deposits are money a bank holds for its customers. Because the money must eventually be returned, it is booked as a liability on the balance sheet. Deposits make up most of a bank's liabilities, which is why banks show very high debt-to-equity ratios.
Loans receivableLoans receivableLoans receivable is money a bank has lent out and not yet been repaid. It makes up most of a bank's assets and is its core asset that 'sells and earns revenue', much like a manufacturer's inventories.
Provision for credit lossesProvision for credit lossesThis is the amount newly set aside as an expense for the year to cover loans that may not be repaid. It is a core expense in a bank's income statement, and a big increase is read as a sign that the bank is preparing for bad loans.
BIS total capital ratioBIS total capital ratioThis is the ratio of equity to risk-weighted assets. It is a safety indicator showing how thick a bank's capital cushion is for absorbing losses, and for banks it is used instead of the debt-to-equity ratio. It appears under 'Financial soundness' in Chapter II of a bank's annual report.
NPL ratioNPL ratioThis is the share of total loans in the 'substandard, doubtful or estimated loss' grades, where repayment is in doubt. It shows how bad a bank's loans are, and lower is healthier.
Delinquency rateDelinquency rateThis is the share of loans on which principal and interest payments are overdue by a set period (usually one month) or more. It is a number that shows whether lent money is coming back on time.
NPL coverage ratioNPL coverage ratioThis is the ratio of accumulated loan loss allowances to non-performing loans. Above 100% means the bank has set aside more than the amount of its bad loans in advance.
Net interest margin (NIM)Net interest margin(Interest income − interest expense) ÷ interest-earning assets. It is the representative indicator of how much a bank earns from its interest business. The NIM of Korean banks was 1.45% in 2021 and 1.62% in 2022.
Net interest incomeNet interest incomeThis is the interest income a bank receives from loans, bonds and so on, minus the interest expense it pays on deposits and the like. It accounts for the largest share of total earnings at Korean banks.
Debt-to-equity ratioDebt-to-equity ratioLiabilities ÷ equity. It shows how much must be repaid per KRW 100 of shareholders' equity. Averages differ greatly by industry, so compare within the same industry.
Current ratioCurrent ratioCurrent assets ÷ current liabilities. It shows how many assets that turn into cash within a year there are relative to debt due within a year.
Operating marginOperating marginOperating profit divided by revenue. It shows how many won are left from the core business per 100 won of revenue. Normal ranges differ greatly by industry.
Free cash flow (FCF)Free Cash FlowOperating cash flow minus capital expenditure (acquisition of tangible assets). It's the cash left after making the investments needed to keep the business running, and it is the source of dividends, buybacks, and debt repayment.
ROE (Return on Equity)Return on EquityNet income divided by net assets (equity), showing how much shareholders' money earns in a year. The relationship PBR = PER × ROE links the two multiples.
Payout ratioPayout ratioTotal cash dividends ÷ net income attributable to owners of the parent. It shows what percentage of net income was paid out as dividends. Even if the dividend stays the same, it rises when earnings fall.
Dividend per share (DPS)Dividend Per ShareTotal dividends divided by the number of shares (excluding treasury stock): the dividend one share receives. Common and preferred shares may be set separately.
Dividend yieldDividend yieldDividend per share ÷ stock price. It shows what percentage of your investment the year's dividend is if you buy at today's price. It also rises when the stock price falls, so separate out the reasons.
Key audit mattersKey audit matters (KAM)Items the auditor judged most important and paid the most attention to in this audit, described in the audit report. Items that involve a lot of judgment, such as revenue recognition, inventory valuation and goodwill impairment, are the ones that usually appear.
Holding companyHolding companyA company whose main business is owning subsidiaries' shares and controlling the group. Its separate income is mostly dividends and royalties, so consolidated and separate should be viewed together.
Profit attributable to owners of the parentProfit attributable to owners of the parentThe share of consolidated net income that goes to the parent company's shareholders. It is the figure after subtracting other shareholders' share of subsidiaries (non-controlling interest), and it is used to calculate EPS.
Put what you learned to use right away
Financial Statements Lesson 5 · Annual report table-of-contents map→Financial Statements Lesson 26 · Compare within the same industry→Learn (Economics) Lesson 18 · Interest rates and sectors: why are banks and insurers different?→This is educational material and not investment solicitation. There is no guarantee that past relationships will repeat in the future.