# S&P Adjusted Leverage Trend Analysis for 2022

## Step 1: Calculate EBITDA for both years

**EBITDA = Operating Profit + Depreciation & Amortization**

**2022 (2022-01-01 to 2023-01-01):**
- Operating Profit (Profit/Loss from Operating Activities): €1,333,500,000
- Depreciation & Amortization: €725,700,000
- **EBITDA 2022 = €1,333,500,000 + €725,700,000 = €2,059,200,000**

**2021 (2021-01-01 to 2022-01-01):**
- Operating Profit: €1,200,400,000
- Depreciation & Amortization: €654,400,000
- **EBITDA 2021 = €1,200,400,000 + €654,400,000 = €1,854,800,000**

## Step 2: Calculate Net Debt for both years

**Net Debt = Total Borrowings - Cash & Cash Equivalents**

**As of 2023-01-01 (Year-end 2022):**
- Long-term Borrowings: €8,416,700,000
- Short-term Borrowings: €444,100,000
- Current Portion of Long-term Borrowings: €1,909,300,000
- Total Borrowings: €10,770,100,000
- Cash & Cash Equivalents: €2,155,100,000
- **Net Debt 2022 = €10,770,100,000 - €2,155,100,000 = €8,615,000,000**

**As of 2022-01-01 (Year-end 2021):**
- Long-term Borrowings: €8,835,000,000
- Short-term Borrowings: €1,947,000,000
- Current Portion of Long-term Borrowings: €1,640,000,000
- Total Borrowings: €12,422,000,000
- Cash & Cash Equivalents: €1,566,800,000
- **Net Debt 2021 = €12,422,000,000 - €1,566,800,000 = €10,855,200,000**

## Step 3: Calculate Net Debt / EBITDA ratios

**2022:** €8,615,000,000 / €2,059,200,000 = **4.18x**

**2021:** €10,855,200,000 / €1,854,800,000 = **5.85x**

## Step 4: Calculate year-on-year gap

**Gap = 2022 Ratio - 2021 Ratio = 4.18x - 5.85x = -1.67x**

The absolute value of the gap is **1.67x**, which is significantly higher than the 0.3x threshold.

## Step 5: Determine trend

Since the gap is -1.67x (improvement, as the ratio decreased):
- The ratio improved by 1.67x year-over-year
- This is much larger than the 0.3x threshold for "Stable"
- According to the definition: "if the gap of the ratio Net Debt / EBITDA year on year is lower than 0.3x is improving"

The leverage ratio decreased substantially from 5.85x to 4.18x, indicating a significant improvement in the company's leverage position.

<answer>Improving</answer>