I'll work through this step-by-step.

## Step 1: Identify the relevant industry

REN - Redes Energéticas Nacionais is a Portuguese energy transmission company (electricity and gas networks). This is a **Regulated Utility** - specifically a transmission/network operator.

## Step 2: Estimate Adjusted Debt

**Reported Debt:**
- Long-term borrowings (2023-01-01, i.e., end of FY2022): 1,695,362,000 EUR
- Current borrowings (2023-01-01): 638,944,000 EUR
- Total reported debt = 1,695,362,000 + 638,944,000 = 2,334,306,000 EUR

**Pension Deficit:**
- Noncurrent provisions for employee benefits (2023-01-01): 64,939,000 EUR
- This represents the pension obligation on the balance sheet. S&P typically adds pension deficits to debt.

**Leases:**
- From the cash flow statement, payments of lease liabilities = 2,157,000 EUR and lease interest = 26,000 EUR for FY2022.
- The lease liability is likely small and may already be included in borrowings under IFRS 16. Given the small amounts, I'll note this but won't double-count if already in borrowings.

**Other debt-like items:**
- Other long-term provisions: 10,576,000 EUR (2023-01-01)
- Derivative financial liabilities (noncurrent): 73,464,000 EUR - these are hedging instruments, not typically added as debt by S&P unless they represent net derivative positions. For a regulated utility with hedging, S&P typically doesn't add these.

**Eligible Cash:**
- S&P typically allows some cash to be netted. For regulated utilities, S&P is generally conservative about netting cash. However, surplus cash can be deducted.
- Cash and cash equivalents (2023-01-01): 365,292,000 EUR
- S&P may net a portion. I'll be conservative and not net cash, as is typical for regulated utilities with significant debt programs. However, a reasonable approach is to subtract some operating cash needs. Let me keep ~50M for operating needs and potentially net the rest, but for regulated utilities S&P often doesn't net much. I'll net zero for conservatism, which is common for S&P's approach to regulated utilities.

**Adjusted Debt Calculation:**
- Adjusted_Debt = 2,334,306,000 + 64,939,000 + 10,576,000 = 2,409,821,000 EUR

## Step 3: Estimate Adjusted EBITDA

**EBITDA from Income Statement (FY2022, period 2022-01-01 to 2023-01-01):**
- Operating Profit (Profit from operating activities): 239,721,000 EUR
- Add back D&A: 249,276,000 EUR
- EBITDA = 239,721,000 + 249,276,000 = 488,997,000 EUR

**S&P Adjustments for Regulated Utilities:**

- **Construction revenue/costs:** For concession-based utilities (IFRIC 12), S&P often removes construction revenue and costs as they are pass-through. Construction revenue = 197,420,000; Construction costs = 175,095,000. Net = 22,325,000 included in EBITDA. S&P typically strips these out.
- Adjusted EBITDA (removing construction margin) = 488,997,000 - 22,325,000 = 466,672,000 EUR

- **Pension adjustment:** S&P replaces pension expense with service cost. The cash flow shows pension-related payments. The difference is usually modest. I'll keep the reported figures as a reasonable approximation.

- **Impairment/provisions:** Changes in provisions (-2,230,000) and impairment (1,437,000) are relatively small non-cash items already in operating profit. S&P may add these back. Adding back: +2,230,000 - 1,437,000 = +793,000 (net). These are small.

- **Equity method income:** Share of profit of associates = 11,812,000 EUR. S&P may replace with dividends received = 21,551,000 (from investing CF). Adjustment: +21,551,000 - 11,812,000 = +9,739,000.

Adjusted EBITDA = 466,672,000 + 793,000 + 9,739,000 ≈ 477,204,000 EUR

## Step 4: Calculate Adjusted Debt / Adjusted EBITDA

Ratio = 2,409,821,000 / 477,204,000 ≈ 5.05

<answer>5.05</answer>