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

## Step 1: Identify the relevant industry

A2A S.p.A. is an Italian multi-utility company (parent of A2A Energia S.p.A.), with operations in energy generation, distribution, and supply. Based on the data showing a mix of regulated and unregulated activities, and the company being described as a multi-utility headquartered in Italy with municipalities of Milan and Brescia as parents, this fits the **Regulated Utilities / Multi-utilities** category, with some unregulated power and gas exposure.

## Step 2: Estimate 2021 Adjusted EBITDA

From the data:
- EBITDA (2021, reported as "Gross Operating Income EBITDA"): €1,428M
- Result from nonrecurring transactions (2021): €0M
- No explicit lease adjustments or pension adjustments provided separately

For S&P adjustments:
- Pension adjustments: The noncurrent provisions for employee benefits changed, but we need the service cost vs. actual cash payments. I'll use the reported EBITDA as a starting approximation.
- Operating lease adjustments: Not separately broken out, but payments of lease liabilities (2021) = €2M (relatively immaterial).

**Adjusted_EBITDA (2021) ≈ €1,428M + €2M (lease adjustment) ≈ €1,430M**

## Step 3: Estimate 2021 FFO

FFO = Adjusted_EBITDA - cash_interest - cash_taxes

- Cash interest paid (2021): €80M
- Cash taxes paid (2021): €165M

**FFO (2021) = €1,430M - €80M - €165M = €1,185M**

## Step 4: Estimate 2021 Adjusted Debt

Reported financial liabilities:
- Noncurrent financial liabilities (end 2021, i.e., 2022-01-01): €4,322M
- Current financial liabilities (end 2021): €746M
- Total reported debt: €4,322M + €746M = €5,068M

S&P adjustments:
- Pension deficit: Noncurrent provisions for employee benefits (end 2021): €294M
- Operating lease capitalization: Small (~€2M annual payments, minimal)
- Cash: €964M (end 2021). S&P typically nets only "surplus" cash. For utilities, they may net a portion. I'll assume about 75% is nettable given the large cash balance: ~€723M (being conservative, I'll net a more modest amount; for a utility with significant working capital needs, perhaps 50%: ~€482M)

Let me be more conservative and use a standard approach - net minimal excess cash. Given the large working capital swings, I'll conservatively net ~€200M.

**Adjusted_Debt (2021) = €5,068M + €294M + ~€10M (leases) - €200M ≈ €5,172M**

## Step 5: 2021 Adjusted_Debt / Adjusted_EBITDA

**€5,172M / €1,430M = 3.62x**

## Step 6: 2021 FFO / Adjusted_Debt

**€1,185M / €5,172M = 0.229 (22.9%)**

## Step 7: Estimate 2022 Adjusted EBITDA

- EBITDA (2022): €1,505M
- Nonrecurring gains (Result from nonrecurring transactions): €157M (this appears to be a gain, subtract it)
- Lease payments: €11M

**Adjusted_EBITDA (2022) = €1,505M - €157M + €11M ≈ €1,359M**

## Step 8: Estimate 2022 FFO

- Cash interest (2022): €75M
- Cash taxes (2022): €201M

**FFO (2022) = €1,359M - €75M - €201M = €1,083M**

## Step 9: Estimate 2022 Adjusted Debt

- Noncurrent financial liabilities (end 2022): €5,867M
- Current financial liabilities (end 2022): €1,022M
- Total reported debt: €6,889M
- Pension: €248M
- Leases: ~€50M (estimated capitalization)
- Cash netting: ~€200M (conservative)

**Adjusted_Debt (2022) = €6,889M + €248M + €50M - €200M ≈ €6,987M**

## Step 10: 2022 Adjusted_Debt / Adjusted_EBITDA

**€6,987M / €1,359M = 5.14x**

## Step 11: 2022 FFO / Adjusted_Debt

**€1,083M / €6,987M = 0.155 (15.5%)**

## Step 12: Classify the trend

**Signal 1 (Leverage):** 5.14x - 3.62x = +1.52x → ≥ +0.2x → **Deteriorating**

**Signal 2 (Cash-flow coverage):** 0.155 - 0.229 = -0.074 → ≤ -0.03 → **Deteriorating**

Both signals agree: **Deteriorating**

<answer>Deteriorating</answer>