# Reasoning: S&P's Adjusted Leverage Trend for 2022

To assess the leverage trend, I need to calculate Net Debt / EBITDA for 2022 and 2023, then compare the year-on-year gap.

## Step 1: Calculate EBITDA for each year

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

**2023 (year ending 2023-01-01):**
- Operating Profit (EBIT): EUR 17,510 million
- Depreciation & Amortization: EUR 7,205 million
- EBITDA 2023 = 17,510 + 7,205 = **EUR 24,715 million**

**2022 (year ending 2022-01-01):**
- Operating Profit (EBIT): EUR 12,341 million
- Depreciation & Amortization: EUR 7,063 million
- EBITDA 2022 = 12,341 + 7,063 = **EUR 19,404 million**

## Step 2: Calculate Net Debt

**Net Debt = Total Borrowings + Lease Liabilities - Cash & Cash Equivalents**

**2023 (as of 2023-01-01):**
- Short-term Borrowings: EUR 4,446 million
- Current Portion of Long-term Borrowings: EUR 3,097 million
- Long-term Borrowings: EUR 19,374 million
- Current Lease Liabilities: EUR 884 million
- Noncurrent Lease Liabilities: EUR 4,067 million
- Total Debt & Leases: 4,446 + 3,097 + 19,374 + 884 + 4,067 = EUR 31,868 million
- Cash & Cash Equivalents: EUR 10,155 million
- Net Debt 2023 = 31,868 - 10,155 = **EUR 21,713 million**

**2022 (as of 2022-01-01):**
- Short-term Borrowings: EUR 2,299 million
- Current Portion of Long-term Borrowings: EUR 1,781 million
- Long-term Borrowings: EUR 23,714 million
- Current Lease Liabilities: EUR 948 million
- Noncurrent Lease Liabilities: EUR 4,389 million
- Total Debt & Leases: 2,299 + 1,781 + 23,714 + 948 + 4,389 = EUR 33,131 million
- Cash & Cash Equivalents: EUR 8,254 million
- Net Debt 2022 = 33,131 - 8,254 = **EUR 24,877 million**

## Step 3: Calculate Net Debt / EBITDA Ratio

**2023:**
- Net Debt / EBITDA 2023 = 21,713 / 24,715 = **0.88x**

**2022:**
- Net Debt / EBITDA 2022 = 24,877 / 19,404 = **1.28x**

## Step 4: Assess Year-on-Year Change

**Gap = 0.88x - 1.28x = -0.40x**

The absolute change is 0.40x, which exceeds the ±0.3x threshold.

Since the gap is **-0.40x** (a decrease in leverage ratio), the leverage is **improving** (becoming better). The ratio decreased by more than 0.3x, indicating a meaningful improvement in leverage.

<answer>Improving</answer>