To estimate S&P's adjusted leverage trend for 2022, we need to calculate the Net Debt / EBITDA ratio for the years ending 2021 (represented by the data labeled "Previously Stated Member" 2022-01-01, which corresponds to the full year 2021 performance and year-end 2021 balance sheet positions usually used for prior year comparison in this context, or more accurately, we look at the ratios for the fiscal years 2021 and 2022). However, the prompt provides data for "2022-01-01 - 2023-01-01" (Fiscal Year 2022) and "2021-01-01 - 2022-01-01" (Fiscal Year 2021). It also provides balance sheet data at "2023-01-01" (End of 2022) and "2022-01-01" (End of 2021). S&P Global Ratings typically calculates leverage using Net Debt and EBITDA. **Net Debt** = Total Financial Debt - Cash and Cash Equivalents. **EBITDA** is provided directly as "Beneficio Bruto De Explotacion Ebitda". Let's calculate the ratios for the two relevant periods. **1. Fiscal Year 2021 (Data labeled 2021-01-01 - 2022-01-01 for P&L, and Balance Sheet at 2022-01-01 which is end of 2021):** * **EBITDA (2021):** 12,006,000,000 EUR * **Financial Debt (End 2021):** * Noncurrent Financial Liabilities: 37,175,000,000 EUR * Current Financial Liabilities: 21,297,000,000 EUR * Total Financial Debt = 37,175 + 21,297 = 58,472,000,000 EUR * *Note: S&P adjustments might include lease liabilities or other items, but standard Net Debt usually focuses on interest-bearing debt. Let's look at the components provided. "Noncurrent Financial Liabilities" and "Current Financial Liabilities" are the main debt buckets. Lease liabilities are often included in S&P's debt definition.* * Let's check Lease Liabilities: * Noncurrent Lease Liabilities: 2,253,000,000 EUR * Current Lease Liabilities: 158,000,000 EUR * Total Leases = 2,411,000,000 EUR * Adjusted Debt (including leases) = 58,472 + 2,411 = 60,883,000,000 EUR. * *Alternative*: Sometimes "Financial Liabilities" in these reports already include leases or are distinct. Looking at the breakdown: * Noncurrent Financial Liabilities (37,175) includes "Deudas Con Entidades..." (31,179), "Instrumentos De Capital..." (525), "Noncurrent Derivative..." (1,673), "Noncurrent Lease Liabilities" (2,253), "Other Noncurrent Financial Liabilities" (1,545). Sum: 31,179+525+1,673+2,253+1,545 = 37,175. So Leases are included in Financial Liabilities. * Current Financial Liabilities (21,297) includes "Deudas... Corrientes" (9,984), "Instrumentos... Corriente" (100), "Current Derivative..." (2,111), "Current Lease Liabilities" (158), "Other Current Financial Liabilities" (2,980). Sum: 9,984+100+2,111+158+2,980 = 15,333. Wait, the sum is 15,333, but the total is 21,297. There is a discrepancy or missing items in the sub-list provided in the thought process, but we must trust the top-line "Current Financial Liabilities" and "Noncurrent Financial Liabilities" figures provided in the facts. * Total Financial Debt (End 2021) = 37,175 + 21,297 = 58,472,000,000 EUR. * **Cash and Cash Equivalents (End 2021):** 4,033,000,000 EUR. * **Net Debt (End 2021):** 58,472 - 4,033 = 54,439,000,000 EUR. * **Leverage Ratio 2021:** Net Debt / EBITDA = 54,439 / 12,006 ≈ **4.53x**. **2. Fiscal Year 2022 (Data labeled 2022-01-01 - 2023-01-01 for P&L, and Balance Sheet at 2023-01-01 which is end of 2022):** * **EBITDA (2022):** 13,228,000,000 EUR. * **Financial Debt (End 2022):** * Noncurrent Financial Liabilities: 44,216,000,000 EUR. * Current Financial Liabilities: 25,079,000,000 EUR. * Total Financial Debt = 44,216 + 25,079 = 69,295,000,000 EUR. * **Cash and Cash Equivalents (End 2022):** 4,608,000,000 EUR. * **Net Debt (End 2022):** 69,295 - 4,608 = 64,687,000,000 EUR. * **Leverage Ratio 2022:** Net Debt / EBITDA = 64,687 / 13,228 ≈ **4.89x**. **3. Trend Analysis:** * Ratio 2021: 4.53x * Ratio 2022: 4.89x * Change (Gap): 4.89 - 4.53 = **+0.36x**. The definition states: * **Stable**: Gap is among ± 0.3x (i.e., between -0.3x and +0.3x). * **Improving**: Gap is lower than -0.3x (ratio decreases significantly). *Correction*: The prompt says "if the gap ... is lower than 0.3x is improving". This phrasing is slightly ambiguous. Usually, "Improving" leverage means the ratio goes down. "Deteriorating" means it goes up. * Let's re-read carefully: "Consequently if the gap of the ratio Net Debt / EBITDA year on year is lower than 0.3x is improving. If higher is Deteriorating." * This specific prompt definition seems to define the threshold relative to a positive change or absolute magnitude? * Standard interpretation: * If Ratio_2022 - Ratio_2021 > 0.3x -> Deteriorating. * If Ratio_2022 - Ratio_2021 < -0.3x -> Improving. * If between -0.3x and 0.3x -> Stable. * However, the prompt says: "if the gap ... is lower than 0.3x is improving". This likely implies a signed gap. If Gap < 0.3, it could mean anything below 0.3. But it also says "Stable ... is among ± 0.3x". This creates a contradiction if "lower than 0.3x" includes the stable range. * Let's look at the second part: "If higher is Deteriorating." Higher than what? Higher than 0.3x? * Let's assume the standard logic for these types of questions: * Deteriorating: Leverage increases by more than 0.3x. (Gap > 0.3x) * Improving: Leverage decreases by more than 0.3x. (Gap < -0.3x) * Stable: Change is within [-0.3x, 0.3x]. * My calculated gap is **+0.36x**. * 0.36x is **higher** than 0.3x. * Therefore, the trend is **Deteriorating**. Let's double check the calculations. **2021:** Debt: 37,175 + 21,297 = 58,472. Cash: 4,033. Net Debt: 54,439. EBITDA: 12,006. Ratio: 54,439 / 12,006 = 4.534. **2022:** Debt: 44,216 + 25,079 = 69,295. Cash: 4,608. Net Debt: 64,687. EBITDA: 13,228. Ratio: 64,687 / 13,228 = 4.890. Difference: 4.890 - 4.534 = 0.356. 0.356 > 0.3. The leverage ratio increased by more than 0.3x. An increase in leverage is a deterioration of credit quality. The prompt states: "If higher [than 0.3x] is Deteriorating." Therefore, the answer is Deteriorating. Deteriorating