**Step 1: Identify the relevant industry for "EDP, S.A."**

EDP - Energias de Portugal, S.A. is described as involved in "generation, transmission, distribution and supply of electricity and supply of gas." The facts show it operates in regulated and unregulated activities (e.g., renewables through EDP Renováveis). Given the integrated nature, we must determine which methodology applies. The existence of tariffs, a regulatory framework (e.g., CESE, regulatory assets), and integrated operations suggests the **Regulated Utilities** or **Unregulated Power And Gas** methodology is most relevant. EDP is a large integrated utility with a mix of regulated networks and generation/retail. The unregulated portion is significant (Renewables). According to the provided text, for Unregulated Power And Gas, we use the medial volatility table if a portion of cash flows (about 50% from regulated with adequate advantage) is met. EDP likely qualifies for the medial volatility table. However, the financial ratio calculation baseline formulas (Adjusted_EBITDA, FFO, Adjusted_Debt) do not change based on volatility table. We will use the general approach but note the industry adjustments mentioned.

No specific industry adjustments to the formulas are provided in the prompt beyond the general guidelines; the prompt says: "Use the following baseline formula, modifying it as required by the industry methodology identified in Step 1." The industry methodologies provided don't give specific numeric adjustments like "add back X" for regulated utilities ratios, but they reference "Corporate Methodology: Ratios And Adjustments" and mention adjustments like leases, pensions, and securitized debt. Lacking detailed internal S&P adjustment data, we will apply the baseline formulas using the data available, inferring standard S&P adjustments where possible (e.g., operating leases, pension deficits).

**Step 2: Estimate 2021 "Adjusted_EBITDA"**

We reconstruct EBITDA from the income statement.
We have "Profit Loss Before Provisions Amortisation And Impairment Financial Income And Financial Expenses Income Tax Expense And Extraordinary Contribution To The Energy Sector CESE" = 3,723,050,000 EUR. This is essentially EBITDA before JV/Associates? No, JV/Associates is included above this line.
The line "Profit Loss Before Provisions Amortisation..." is exactly EBITDA before Provisions, D&A, etc.
Let's check:
Net Of Revenue And Cost Of Energy Sales And Other = 4,907,162,000
Other Income = 1,023,988,000
Services Expense = -888,954,000
Employee Benefits Expense = -666,459,000
Other Expense By Nature = -727,965,000
Impairment Loss... = -32,828,000
Joint Ventures And Associates = 108,106,000
Summing these: 4,907,162 + 1,023,988 - 888,954 - 666,459 - 727,965 - 32,828 + 108,106 = 3,723,050,000. Matches.

Adjusted_EBITDA = This reported EBITDA + lease adjustments (Right-of-use depreciation + interest on leases) - nonrecurring + pension adjustments + JV adjustments.
From cash flow: "Payments Of Lease Liabilities Classified As Financing Activities" = 98,772,000.
We can approximate lease depreciation as ROU asset change? ROU Asset 2022-01-01: 1,007,029,000; 2021-01-01: Not given. Given simplicity, we assume lease adjustment adds back the lease depreciation and interest. S&P adds back operating lease expense to EBITDA.
Alternatively, we can estimate starting from "Adjusted_EBITDA" using reported EBITDA.
Reported EBITDA = 3,723,050,000.
S&P typically adds back lease expense. We don't have the split of lease depreciation and interest. We can approximate by adding the lease payments. However, S&P adds back the entire lease expense (depreciation + implied interest) to EBITDA, which is roughly equivalent to the lease payment. So Adjusted_EBITDA ≈ 3,723,050,000 + 98,772,000 = 3,821,822,000.

We also need to consider pension adjustments. The pension deficit is on the balance sheet, but pension expense might differ from cash contributions. We have "Noncurrent Provisions For Employee Benefits" = 940,266,000 (2021) and "Current Provisions For Employee Benefits" = 179,534,000 (2021). Total = 1,119,800,000. We might need to adjust for pension service cost vs contributions, but we lack data. We will skip explicit pension adjustment for EBITDA due to lack of data on cash contributions vs expense, but we will include the deficit in debt.
Other nonrecurring items: We don't have specific one-time items called out. "Gains Losses On Disposal And Scope Effects Except Asset Rotation" = 0 in 2021. So no adjustment.
JV/Associates is already included in the income-based EBITDA line.
So Adjusted_EBITDA (2021) = 3,821,822,000 EUR (approx).

**Step 3: Estimate 2021 "FFO"**

FFO = Adjusted_EBITDA - cash_interest - cash_taxes.
Cash interest: From cash flow, "Interest And Similar Costs Of Financial Debt Including Hedge Derivatives" = 481,329,000 (paid). "Interest And Similar Costs Relating To Loans From Non Controlling Interests" = 18,244,000. Total cash interest = 481,329,000 + 18,244,000 = 499,573,000.
Cash taxes: From cash flow, "Income Tax And CESE" = -89,845,000 (this is negative in the cash flow reconciliation, meaning it was an outflow? The line "Income Tax And CESE" in the operating activities section is -89,845,000, which is an adjustment subtracted from profit to get operating cash flow? Wait, the cash flow statement starts with Profit Before Tax. Then "Income Tax And CESE" = -89,845,000. This is likely the cash paid for taxes. We'll use the absolute value: 89,845,000.
FFO = 3,821,822,000 - 499,573,000 - 89,845,000 = 3,232,404,000 EUR.

**Step 4: Estimate 2021 "Adjusted_Debt"**

Adjusted_Debt = reported_debt + leases + pension_deficit + other_debt_like_items - eligible_cash.
Reported debt = Longterm Borrowings + Current Borrowings.
Longterm Borrowings 2022-01-01 (Dec 31, 2021): 15,299,588,000
Current Borrowings 2022-01-01: 1,518,348,000
Total Reported Debt = 16,817,936,000.
Leases: "Right-of-use Assets" = 1,007,029,000. S&P uses the lease liability value. We don't have the explicit lease liability separated. We'll approximate it as Right-of-use Assets = 1,007,029,000 (assuming no initial direct costs/prepayments).
Pension deficit: "Noncurrent Provisions For Employee Benefits" (2022-01-01) = 940,266,000. We'll include this as debt-like.
Other debt-like items: "Other Noncurrent Financial Liabilities" = 3,039,975,000 ("Institutional Partnerships In North America" = 2,259,741,000 is also a liability, might be debt-like, but we'll exclude for simplicity). We will add "Collateral Deposits Associated To Financial Debt" (Non-current and Current) in debt or net cash? We'll assume they are netted. "Trade Payables And Other Liabilities From Commercial Activities-Non Current" includes regulatory items.
We'll take Adjusted Debt = 16,817,936,000 (Debt) + 1,007,029,000 (Leases) + 940,266,000 (Pensions) = 18,765,231,000.
Eligible cash: "Cash And Cash Equivalents" = 3,222,409,000. S&P typically caps surplus cash, but we'll use full amount for adjustment.
Adjusted_Debt = 18,765,231,000 - 3,222,409,000 = 15,542,822,000 EUR.

**Step 5: 2021 "Adjusted_Debt / Adjusted_EBITDA"**

15,542,822,000 / 3,821,822,000 = 4.07x.

**Step 6: 2021 "FFO / Adjusted_Debt"**

3,232,404,000 / 15,542,822,000 = 0.208 (20.8%).

**Step 7: Estimate 2022 "Adjusted_EBITDA"**

Reported EBITDA: "Profit Loss Before Provisions Amortisation..." = 4,523,539,000 EUR.
Lease payments: "Payments Of Lease Liabilities Classified As Financing Activities" = 133,696,000.
Adjusted_EBITDA = 4,523,539,000 + 133,696,000 = 4,657,235,000 EUR.

**Step 8: Estimate 2022 "FFO"**

Cash interest: "Interest And Similar Costs..." = 716,454,000 + "Interest... Non Controlling Interests" = 12,885,000 = 729,339,000.
Cash taxes: "Income Tax And CESE" = -258,849,000 -> 258,849,000.
FFO = 4,657,235,000 - 729,339,000 - 258,849,000 = 3,669,047,000 EUR.

**Step 9: Estimate 2022 "Adjusted_Debt"**

Total Reported Debt 2023-01-01: 15,782,604,000 + 4,239,869,000 = 20,022,473,000.
Leases: Right-of-use Assets = 1,320,270,000.
Pension deficit: Noncurrent Provisions For Employee Benefits = 644,299,000.
Total = 20,022,473,000 + 1,320,270,000 + 644,299,000 = 21,987,042,000.
Cash: 4,900,205,000.
Adjusted_Debt = 21,987,042,000 - 4,900,205,000 = 17,086,837,000 EUR.

**Step 10: 2022 "Adjusted_Debt / Adjusted_EBITDA"**

17,086,837,000 / 4,657,235,000 = 3.67x.

**Step 11: 2022 "FFO / Adjusted_Debt"**

3,669,047,000 / 17,086,837,000 = 0.215 (21.5%).

**Step 12: Classify Credit Trend**

Signal 1 (Leverage): 3.67x - 4.07x = -0.40x. This is ≤ -0.2x → **Improving**.
Signal 2 (Cash-flow coverage): 0.215 - 0.208 = 0.007 (+0.7 percentage points). This is between -0.03 and +0.03 → **Stable**.

Combining:
One is Stable, the other is Improving.
Return the non-Stable category: **Improving**.

**Final Answer**
<answer>Improving</answer>