# Net Debt / EBITDA Ratio Calculation for EDP S.A. (2022)

## Step 1: Identify the S&P Methodology Components

The S&P methodology for Net Debt / EBITDA typically defines:
- **Net Debt** = Total Debt - Cash and Cash Equivalents
- **Total Debt** = Short-term borrowings + Long-term borrowings
- **EBITDA** = Operating profit (EBIT) + Depreciation & Amortization

## Step 2: Extract Relevant Data for 2022 (Year ended 2022-01-01)

From the financial statements:

**Debt Components (2022-01-01):**
- Long-term Borrowings: 15,299,588,000 EUR
- Current Borrowings and Current Portion of Noncurrent Borrowings: 1,518,348,000 EUR
- Total Debt = 15,299,588,000 + 1,518,348,000 = **16,817,936,000 EUR**

**Cash Position (2022-01-01):**
- Cash and Cash Equivalents: 3,222,409,000 EUR

**Net Debt:**
- Net Debt = 16,817,936,000 - 3,222,409,000 = **13,595,527,000 EUR**

## Step 3: Calculate EBITDA for 2022 (Period 2021-01-01 to 2022-01-01)

**Method: Start from Operating Profit and add back D&A**

Operating Profit (EBIT) before provisions, depreciation, and impairments:
- Profit/Loss Before Provisions, Amortisation and Impairment: 3,723,050,000 EUR
- Less: Depreciation, Amortisation and Impairment Loss: 1,731,755,000 EUR
- Therefore: **EBIT = 3,723,050,000 - 1,731,755,000 = 1,991,295,000 EUR**

Wait, this doesn't seem right. Let me reconsider:

The line "Profit Loss Before Provisions Amortisation And Impairment Financial Income And Financial Expenses Income Tax Expense And Extraordinary Contribution To The Energy Sector CESE" is already **before** deducting depreciation and impairment. This represents EBITDA-like measure.

However, to be precise with S&P methodology:
- Take Operating Profit and add back D&A, or
- Use the pre-DA operating profit directly

The figure 3,723,050,000 EUR appears to be operating profit before D&A, provisions, and financial items.

For EBITDA calculation:
- **EBITDA = 3,723,050,000 EUR** (this is the operating profit before depreciation and amortization)

## Step 4: Calculate Net Debt / EBITDA Ratio

Net Debt / EBITDA = 13,595,527,000 / 3,723,050,000 = **3.65**

<answer>3.65</answer>