I need to estimate the Net Debt / EBITDA ratio for 2022 using S&P methodology. First, let me understand S&P methodology for Net Debt / EBITDA: - **Net Debt** = Total Debt (short-term + long-term borrowings/financial liabilities) minus Cash and Cash Equivalents - **EBITDA** = Earnings Before Interest, Taxes, Depreciation and Amortization From the data, I need to find: 1. EBITDA for 2022 2. Net Debt as of end of 2022 (which is 2023-01-01 balance sheet date) **Finding EBITDA for 2022:** Looking at the income statement data for 2022-01-01 to 2023-01-01: "Operating Profit Before Depreciation And Amortisation" (EBITDA) = -4,986,000,000 EUR Wait, this is negative. Let me verify this is indeed EBITDA. The term "Operating Profit Before Depreciation And Amortisation" is essentially EBITDA. However, this is negative, which is unusual. Let me verify by calculating it from components: - Revenue: 143,476,000,000 - Expense Fuel Energy And Transmission Charges: 121,010,000,000 - Other External Services And Other Work Performed By Entity And Capitalised: 9,420,000,000 - Employee Benefits Expense: 15,236,000,000 - Tax Expense Other Than Income Tax Expense: 3,163,000,000 - Other Operating Income And Expenses Included In Ebe: 367,000,000 EBITDA = Revenue - Operating Expenses (before D&A) = 143,476,000,000 - 121,010,000,000 - 9,420,000,000 - 15,236,000,000 - 3,163,000,000 + 367,000,000 = 143,476,000,000 - 148,462,000,000 = -4,986,000,000 EUR This matches the reported "Operating Profit Before Depreciation And Amortisation" of -4,986,000,000 EUR. So EBITDA = -4,986,000,000 EUR (negative) However, for ratio purposes with negative EBITDA, this would be problematic. Let me check if S&P would adjust this. Actually, looking more carefully, in S&P methodology, they might use "Adjusted EBITDA" or make certain adjustments. But let me proceed with the standard definition. The issue is that with negative EBITDA, the ratio is not meaningful in the traditional sense. However, let me check if there's a different interpretation. Actually, re-reading: "Operating Profit Before Depreciation And Amortisation" = -4,986,000,000 EUR is indeed EBITDA. But wait - I should double-check if this is correct. Let me look at "EBE" which is "Excédent Brut d'Exploitation" in French accounting, equivalent to EBITDA. "Other Operating Income And Expenses Included In Ebe" = 367,000,000 EUR - this suggests it's included in EBE/EBITDA. Let me recalculate more carefully. The standard EBITDA calculation: Revenue - Cost of goods sold/sales - External expenses - Personnel costs - Other operating expenses + Other operating income Actually, looking at French GAAP/IFRS format, EBITDA (or EBE) typically includes: + Revenue - Purchases and changes in inventories - Other external expenses - Taxes and duties - Personnel costs + Other operating income - Other operating expenses From the data: - Revenue: 143,476,000,000 - Expense Fuel Energy And Transmission Charges: 121,010,000,000 (this is like COGS/external purchases) - Other External Services: 9,420,000,000 - Employee Benefits: 15,236,000,000 - Tax Expense Other Than Income Tax: 3,163,000,000 - Other Operating Income And Expenses Included In Ebe: 367,000,000 (positive = income) So: 143,476 - 121,010 - 9,420 - 15,236 - 3,163 + 367 = -4,986 million EUR This confirms EBITDA = -4,986,000,000 EUR **Finding Net Debt at end of 2022 (2023-01-01):** Net Debt = Total Financial Debt - Cash and Cash Equivalents I need to find total debt (financial liabilities). Let me look at the balance sheet items at 2023-01-01: From the balance sheet: - Other Noncurrent Financial Liabilities: 71,058,000,000 EUR - Other Current Financial Liabilities: 71,844,000,000 EUR Wait, I need to check if there are other debt items. Let me look more carefully. Looking at liabilities at 2023-01-01: - Noncurrent Provisions: 76,923,000,000 (not debt) - Special French Public Electricity Distribution Concession Liabilities: 49,459,000,000 (this is specific to concession accounting, may or may not be debt-like) - Other Noncurrent Financial Liabilities: 71,058,000,000 - Other Noncurrent Liabilities: 4,968,000,000 - Deferred Tax Liabilities: 1,533,000,000 - Current Provisions: 7,943,000,000 - Trade And Other Current Payables: 23,284,000,000 - Other Current Financial Liabilities: 71,844,000,000 - Current Tax Liabilities: 967,000,000 - Other Current Liabilities: 33,504,000,000 For S&P methodology, debt typically includes: - Financial liabilities (both current and non-current) - Sometimes specific provisions or concession liabilities if they are debt-like Let me focus on "Financial Liabilities": - Other Noncurrent Financial Liabilities: 71,058,000,000 - Other Current Financial Liabilities: 71,844,000,000 Total Financial Debt = 71,058,000,000 + 71,844,000,000 = 142,902,000,000 EUR Cash and Cash Equivalents: 10,948,000,000 EUR Net Debt = 142,902,000,000 - 10,948,000,000 = 131,954,000,000 EUR Wait - I need to check if there are other debt components. Let me look at "Special French Public Electricity Distribution Concession Liabilities" - this is 49,459,000,000 EUR. In some methodologies, this might be considered debt-like, but in standard S&P methodology for utilities with concessions, this might be treated differently. Actually, for EDF specifically, the "Special French Public Electricity Distribution Concession Liabilities" (régime de concession) relates to the public service concession for electricity distribution in France. Under IFRS, these are typically non-debt liabilities related to concession arrangements. However, looking more carefully at S&P methodology for utilities, they might include certain concession-related liabilities if they are considered debt-like. But let me stick to the standard definition first: financial liabilities only. Also, I need to check if there are any "borrowings" specifically mentioned. Looking through the data, I don't see specific "borrowings" line items separate from "Other Financial Liabilities." Actually, let me re-check: In many European annual reports, "Other Financial Liabilities" includes borrowings, bonds, etc. Total Debt = 71,058,000,000 + 71,844,000,000 = 142,902,000,000 EUR Net Debt = 142,902,000,000 - 10,948,000,000 = 131,954,000,000 EUR **Net Debt / EBITDA ratio:** With EBITDA = -4,986,000,000 EUR (negative), the ratio would be negative, which is not meaningful for credit analysis. However, I need to reconsider. In S&P methodology, they often use "Adjusted EBITDA" which might add back certain items or use a normalized figure. But based on the data given, I should use what's available. Actually, let me re-examine if I'm interpreting EBITDA correctly. In some contexts, particularly with the massive 2022 energy crisis, EDF had exceptional circumstances. The negative EBITDA reflects the regulatory constraints and high energy costs. But wait - let me check if there's an alternative EBITDA calculation. Looking at the cash flow statement: "Net Cash Flow From Operations Before Net Financial Expenses Disbursed And Income Taxes Paid Refund" = -5,140,000,000 EUR This is roughly Operating Cash Flow before interest and taxes, which should be close to EBITDA - Working Capital changes. Actually, let me check: "Increase Decrease In Working Capital" = -8,301,000,000 EUR So EBITDA (approx) - Working Capital changes = -5,140,000,000 EBITDA - (-8,301,000,000) = -5,140,000,000? No wait... Actually: "Net Cash Flow From Operations Before Net Financial Expenses Disbursed And Income Taxes Paid Refund" = -5,140,000,000 This includes: - EBITDA - Changes in working capital - Other adjustments Looking at the adjustments in the cash flow: - Adjustments For Impairment: 1,762,000,000 - Depreciation And Amortisation: 6,820,000,000 - Net Financial Income Or Expense: 446,000,000 - Dividends Received: 590,000,000 - Adjustments For Losses Gains On Disposal: -143,000,000 - Adjustments For Income Tax Expense: -3,926,000,000 - Adjustments For Undistributed Profits Of Associates: 759,000,000 - Increase Decrease In Working Capital: -8,301,000,000 Starting from "Profit Loss From Continuing Operations" = -18,231,000,000 Let me verify: -18,231 + 1,762 + 6,820 + 446 + 590 - 143 - 3,926 + 759 - 8,301 = -5,140,000,000? -18,231 + 1,762 = -16,469 -16,469 + 6,820 = -9,649 -9,649 + 446 = -9,203 -9,203 + 590 = -8,613 -8,613 - 143 = -8,756 -8,756 - 3,926 = -12,682 -12,682 + 759 = -11,923 -11,923 - 8,301 = -20,224 That doesn't equal -5,140. Let me recheck... Actually, looking more carefully at "Depreciation And Amortisation Expense Provisions And Fair Value Gains Losses" = 6,820,000,000. This might not be pure D&A. Pure "Depreciation And Amortisation Expense" from income statement = 11,079,000,000 Hmm, there's a discrepancy. The cash flow adjustment shows 6,820,000,000 which is different. Actually, I think the 6,820,000,000 might be net of certain items or include provisions. Let me just use the direct EBITDA figure from the income statement: -4,986,000,000 EUR. But this gives a negative ratio. For credit analysis purposes, S&P might calculate this differently or note it as "NM" (not meaningful). However, the question asks me to estimate the ratio. Let me think about whether there are adjustments S&P would make. Actually, re-reading the data more carefully, I notice that "Operating Profit Before Depreciation And Amortisation" is indeed -4,986,000,000. But I want to verify this is truly EBITDA and not some adjusted version. In French terminology, this is essentially EBE (Excédent Brut d'Exploitation) + possibly some adjustments. Let me also consider: in 2022, EDF was subject to exceptional regulatory measures in France (ARENH tariff, price caps, etc.), which severely impacted profitability. The negative EBITDA reflects this. For S&P methodology specifically, they might adjust EBITDA for certain non-recurring or exceptional items. However, without specific guidance on what to adjust, I should use the reported figure. But wait - I need to re-check my debt calculation. Let me look more carefully at what constitutes "debt" in S&P methodology. Looking at the balance sheet again at 2023-01-01: - Special French Public Electricity Distribution Concession Liabilities: 49,459,000,000 - Other Noncurrent Financial Liabilities: 71,058,000,000 - Other Current Financial Liabilities: 71,844,000,000 The "Special French Public Electricity Distribution Concession Liabilities" is specific to French utilities. This represents the obligation to return assets to the conceding authority at the end of the concession, or liabilities related to concession fees. In some analyses, this is treated as debt-like, but it's not financial debt per se. However, for S&P Global Ratings methodology for regulated utilities, they typically include: - Bank borrowings - Bonds - Finance leases - Pension deficits (sometimes) - Hybrid instruments (partial equity credit) They typically exclude: - Trade payables - Tax payables - Regulatory liabilities (unless specifically debt-like) For EDF specifically, the concession liabilities might be treated as operating liabilities rather than debt. Let me check if there's any other debt-like item I missed. Looking at "Noncurrent Provisions" - these include nuclear decommissioning and employee benefits. These are not typically included in "debt" for Net Debt/EBITDA calculations, though they are liabilities. Actually, I want to reconsider the EBITDA figure. Let me look at whether "Operating Profit Before Depreciation And Amortisation" truly equals EBITDA in the S&P sense. Standard EBITDA = Operating Profit + D&A + Impairment (sometimes) From the data: - "Profit Loss From Operating Activities" (Operating Profit) = -19,363,000,000 - "Depreciation And Amortisation Expense" = 11,079,000,000 So Operating Profit + D&A = -19,363,000,000 + 11,079,000,000 = -8,284,000,000 But "Operating Profit Before Depreciation And Amortisation" = -4,986,000,000 These don't match! Let me check what's different. -19,363 + 11,079 = -8,284, not -4,986 The difference is -8,284 - (-4,986) = -3,298, or about 3.3 billion. Looking at other items: - "Net Changes In Fair Value On Energy And Commodity Derivatives Excluding Trading Activities" = -849,000,000 - "Impairment Loss Reversal Of Impairment Loss Recognised In Profit Or Loss" = 1,762,000,000 - "Other Income And Expenses Excluded From Ebe" = 687,000,000 Hmm, "Other Income And Expenses Excluded From Ebe" = 687,000,000. The term "EBE" suggests this is excluded from EBE/EBITDA. Let me try another approach. "Operating Profit Before Depreciation And Amortisation" of -4,986,000,000 is explicitly stated. This should be the EBITDA figure. But when I add D&A to Operating Profit, I get -8,284,000,000. Wait, I need to check: Is "Profit Loss From Operating Activities" the same as "Operating Profit"? Looking at the structure: - Operating Profit Before Depreciation And Amortisation: -4,986,000,000 - Then various items including D&A, impairment, etc. - Resulting in Profit Loss From Operating Activities: -19,363,000,000 Let me trace through: -4,986 (EBITDA) - 11,079 (D&A) = -16,065 + 1,762 (Impairment reversal) = -14,303 - 849 (Fair value changes) = -15,152 + 687 (Other) = -14,465 That doesn't get to -19,363. Let me check if I'm missing items or if the structure is different. Actually, looking more carefully, I think "Operating Profit Before Depreciation And Amortisation" might already include some items, and the reconciliation to "Profit Loss From Operating Activities" involves other items not fully listed in my quick calculation. Regardless, the explicitly stated "Operating Profit Before Depreciation And Amortisation" = -4,986,000,000 EUR is the EBITDA figure I should use. Now, regarding Net Debt, I want to double-check my calculation. In S&P methodology, "Net Debt" typically includes: Gross Debt: - Short-term borrowings and current portion of long-term debt - Long-term borrowings - Finance lease obligations - Sometimes other debt-like items Minus: - Cash and cash equivalents - Liquid investments From the balance sheet at 2023-01-01: - Other Current Financial Liabilities: 71,844,000,000 (this should include short-term debt) - Other Noncurrent Financial Liabilities: 71,058,000,000 (this should include long-term debt) Total Gross Debt = 142,902,000,000 EUR Cash = 10,948,000,000 EUR Net Debt = 131,954,000,000 EUR But wait - I need to check if "Other Current Financial Liabilities" includes items that are not debt, like derivatives or other financial instruments. In many annual reports, "financial liabilities" includes both debt and derivatives. Looking at the notes or additional data... I don't have detailed breakdowns. However, for S&P purposes, they typically focus on "debt" which might exclude certain derivative liabilities or include them depending on the methodology. Actually, looking more carefully at EDF's structure, "Other Financial Liabilities" typically includes: - Borrowings (bonds, bank loans) - Derivative liabilities - Other financial instruments For a precise calculation, I'd need the breakdown. But given the data available, I'll use the total financial liabilities as a proxy for total debt, which is common in simplified analyses. However, I realize I should check if there are any "financial assets" that should be deducted beyond just cash. Looking at current assets: - Other Current Financial Assets: 58,033,000,000 EUR These might include liquid investments that could be netted against debt. But in standard Net Debt calculations, only "Cash and Cash Equivalents" is typically deducted, not other financial assets (which might include receivables, derivatives, etc.). Actually, in some methodologies, "liquid financial assets" or "marketable securities" are also deducted. But without knowing the composition of "Other Current Financial Assets," I'll stick with just Cash and Cash Equivalents. Let me reconsider whether I should include the "Special French Public Electricity Distribution Concession Liabilities" in debt. This is a specific French accounting item for public service concessions. Under IFRIC 12/IFRS 16, concession liabilities can be complex. For S&P methodology, they have specific approaches to concession arrangements. The "Special French Public Electricity Distribution Concession Liabilities" (49,459,000,000 EUR at 2023-01-01) relates to EDF's distribution network concession in France. This is essentially an obligation to maintain and return infrastructure. In some credit analyses, particularly for utilities with concession models, these liabilities are treated as operating liabilities (similar to regulatory liabilities) rather than financial debt. They don't represent borrowed money but rather obligations arising from the concession contract. I'll exclude this from debt for the standard Net Debt/EBITDA calculation. **Final Calculation:** EBITDA (2022) = -4,986,000,000 EUR Net Debt (end 2022) = 131,954,000,000 EUR Net Debt / EBITDA = 131,954,000,000 / (-4,986,000,000) = -26.46x This is negative and not meaningful for credit analysis. However, I need to reconsider if this is the right approach. In practice, when EBITDA is negative, rating agencies might: 1. Use a normalized or adjusted EBITDA 2. Use EBIT instead 3. Note the ratio as "NM" (not meaningful) But the question specifically asks for the ratio. Let me think about whether there's an alternative interpretation. Actually, re-reading the data, I wonder if "Operating Profit Before Depreciation And Amortisation" might be interpreted differently. Let me check if this could be positive under some adjustment. Looking at 2021 for comparison: - Operating Profit Before Depreciation And Amortisation: 18,005,000,000 EUR (positive) - Profit Loss From Operating Activities: 5,225,000,000 EUR So in 2021, EBITDA was strongly positive. The 2022 negative figure reflects the energy crisis impact. For S&P methodology in 2022, they might have adjusted EBITDA for certain items. But without specific adjustment data, I must use what's available. Actually, let me re-verify my debt figures. I want to make sure I'm using the right balance sheet date. The question asks for "Net Debt / EBITDA ratio for 2022". Typically: - EBITDA is for the year 2022 (2022-01-01 to 2023-01-01) - Net Debt is at the end of the period, i.e., 2023-01-01 This is what I've used. However, sometimes Net Debt is calculated as average of beginning and end, or just end of period. For S&P, it's typically end-of-period or average. I'll use end-of-period as most common. Let me also verify: are there any other debt items I should include? Looking at the liability side again: - "Trade And Other Current Payables" = 23,284,000,000 - this is trade credit, not debt - "Other Current Liabilities" = 33,504,000,000 - need to check if this includes debt Actually, "Other Current Liabilities" might include some debt-like items. But without a breakdown, it's hard to say. Typically, in IFRS financial statements, debt is clearly separated into "financial liabilities." Let me also check if there are any "loans" or "borrowings" specifically mentioned that I missed. Scanning through the data again... I don't see specific "Borrowings" line items separate from "Other Financial Liabilities." Actually, looking at the cash flow statement: - "Proceeds From Borrowings Classified As Financing Activities" = 34,165,000,000 - "Repayments Of Borrowings Classified As Financing Activities" = 5,876,000,000 This confirms there are borrowings, but they are included in the "Other Financial Liabilities" on the balance sheet. Given all this, my calculation stands: - Net Debt = 131,954,000,000 EUR - EBITDA = -4,986,000,000 EUR - Ratio = -26.46x But this is clearly not a useful credit metric. Let me think if I made any errors. Wait - I want to re-check the EBITDA figure one more time. Could "Operating Profit Before Depreciation And Amortisation" be different from what I think? Actually, looking at French financial reporting, "Résultat d'exploitation avant dépréciation et amortissement" or similar terms might be used. The explicit figure is -4,986,000,000. But let me verify by looking at whether there's a different "EBITDA" that S&P might use. S&P sometimes uses "S&P Adjusted EBITDA" which adds back certain items like restructuring costs, asset impairments, etc. From the data: - Impairment Loss Reversal = 1,762,000,000 (positive, so this is a gain/reversal) Actually, if I adjust EBITDA for this impairment reversal (which is already included in operating profit), I get... wait, the EBITDA is "before" D&A and impairment, so impairment shouldn't be in EBITDA already. Hmm, let me re-think. "Operating Profit Before Depreciation And Amortisation" - this suggests it's before D&A but what about impairment? Looking at the income statement structure: 1. Operating Profit Before Depreciation And Amortisation: -4,986 2. Then various items to get to Operating Profit Actually, I think the term might mean "before depreciation, amortisation, AND impairment" or it might mean just "before D&A" with impairment included below. Looking at the detailed items between EBITDA and Operating Profit: - Net Changes In Fair Value On Energy And Commodity Derivatives: -849 - Depreciation And Amortisation Expense: -11,079 - Impairment Loss Reversal: +1,762 - Other Income And Expenses Excluded From Ebe: +687 Wait, "Other Income And Expenses Excluded From Ebe" - this suggests these are excluded from EBE (which is EBITDA). So EBE/EBITDA excludes these items. Let me try: -4,986 - 11,079 + 1,762 + 687 - 849 = -14,465? No wait, that's not right either. Actually, I need to be more careful. The items listed might not all be sequential subtractions. Some might be presented as positive or negative in the original statement. Let me just accept the stated "Operating Profit Before Depreciation And Amortisation" = -4,986,000,000 as EBITDA, and "Profit Loss From Operating Activities" = -19,363,000,000 as Operating Profit. The difference is -19,363 - (-4,986) = -14,377,000,000 This difference should equal: -D&A - other items = -11,079 - 849 + 1,762 + 687 = -9,479? No... -11,079 - 849 + 1,762 + 687 = -9,479, not -14,377 I'm missing about 4,898 million. Let me check if there are other items I'm not seeing in the detailed list. Actually, looking at the original data again, I see I may have missed some items or misread the structure. The data provided is a flat list of facts, not a structured income statement. The items might not all be at the same level. Let me re-read: "Other Income And Expenses Excluded From Ebe" = 687,000,000. This is positive. But it's "excluded from EBE," meaning EBE/EBITDA doesn't include it. Hmm, actually if it's excluded from EBE, then to get from EBE to Operating Profit, I might need to add or subtract it depending on whether it's income or expense. The positive value suggests it's income excluded from EBE, so it would be added after EBE to get to a higher-level profit measure. Actually, I'm overcomplicating this. Let me just use the explicit EBITDA figure given: -4,986,000,000 EUR. Given that this is negative, and the question asks for the ratio, I need to provide the mathematically correct answer even if it's not meaningful for credit analysis. Net Debt / EBITDA = 131,954 / (-4,986) = -26.46 But wait - I want to double-check my Net Debt calculation once more. Let me verify the balance sheet figures: At 2023-01-01: - Other Noncurrent Financial Liabilities: 71,058,000,000 - Other Current Financial Liabilities: 71,844,000,000 - Cash And Cash Equivalents: 10,948,000,000 Net Debt = 71,058 + 71,844 - 10,948 = 131,954 million EUR Yes, this is correct. Actually, I want to check one more thing. Does "Other Current Financial Liabilities" include the current portion of long-term debt? Typically yes. And "Other Noncurrent Financial Liabilities" includes long-term debt. So this should capture total debt. However, I should verify if there are any other financial liabilities not captured. Looking at the balance sheet, I don't see separate "Borrowings" or "Bonds" line items - they seem to be aggregated into "Other Financial Liabilities." One more check: Are there any "financial liabilities" included in "Other Current Liabilities" or "Other Noncurrent Liabilities"? "Other Noncurrent Liabilities" = 4,968,000,000 - this might include some non-financial liabilities like deferred income, etc. "Other Current Liabilities" = 33,504,000,000 - similarly, likely includes tax payables, deferred income, accruals, etc. These are typically not considered "debt" for Net Debt purposes. So my Net Debt calculation seems reasonable. Given all this analysis, the Net Debt / EBITDA ratio for 2022 is: 131,954 / (-4,986) = -26.46 But actually, I realize I should express this more precisely. Let me recalculate: 131,954,000,000 / (-4,986,000,000) = -26.4649... Rounding to two decimal places: -26.46 However, I want to reconsider one more time. Is there any possibility that S&P would use a different EBITDA figure? Looking at the data, I notice "Ebe" is mentioned explicitly in "Other Operating Income And Expenses Included In Ebe" and "Other Income And Expenses Excluded From Ebe." EBE = Excédent Brut d'Exploitation = Gross Operating Surplus = EBITDA (roughly) The fact that some items are "included in EBE" and others "excluded from EBE" suggests the company is distinguishing between what goes into EBE and what doesn't. "Other Operating Income And Expenses Included In Ebe" = 367,000,000 - this is IN EBE "Other Income And Expenses Excluded From Ebe" = 687,000,000 - this is NOT in EBE So the EBITDA/EBE figure of -4,986,000,000 already includes the 367,000,000 and excludes the 687,000,000. This confirms that -4,986,000,000 is the correct EBITDA figure. Actually, I want to make one final check. Could S&P potentially use "Operating Profit" plus D&A instead, where Operating Profit = -19,363,000,000? No, that would give -19,363 + 11,079 = -8,284, which is even more negative and doesn't match the explicit EBITDA line. Or would they use EBIT? EBIT = Operating Profit = -19,363,000,000 (negative) Or would they adjust for the impairment? -19,363 - 1,762 (reversal) = -21,125? No, impairment reversal is already included in operating profit. Actually, I realize I should check if "Profit Loss From Operating Activities" is the same as "Operating Profit" or "EBIT." In IFRS, "Profit from operating activities" is typically EBIT. So EBIT = -19,363,000,000 D&A = 11,079,000,000 EBITDA = EBIT + D&A = -8,284,000,000 But this contradicts the explicit "Operating Profit Before Depreciation And Amortisation" of -4,986,000,000. Unless... "Operating Profit Before Depreciation And Amortisation" is not the same as EBIT + D&A. It might be a sub-total before certain other items. Looking at this again, I think the issue is that "Operating Profit Before Depreciation And Amortisation" in French reporting might include some items and exclude others differently than a simple EBIT + D&A calculation. Given that the company explicitly reports "Operating Profit Before Depreciation And Amortisation" = -4,986,000,000, this is the authoritative EBITDA figure for this company. I'll use this figure. **Final Answer:** Net Debt = 131,954,000,000 EUR EBITDA = -4,986,000,000 EUR Net Debt / EBITDA = -26.46 Wait, I want to do one more verification of my debt calculation. Let me check if there are any other items that should be included in debt. Looking at the 2022 balance sheet (2022-01-01) vs 2023-01-01: 2022-01-01: - Other Noncurrent Financial Liabilities: 56,543,000,000 - Other Current Financial Liabilities: 45,014,000,000 - Cash: 9,919,000,000 - Net Debt 2021 = 56,543 + 45,014 - 9,919 = 91,638,000,000 2023-01-01: - Other Noncurrent Financial Liabilities: 71,058,000,000 - Other Current Financial Liabilities: 71,844,000,000 - Cash: 10,948,000,000 - Net Debt 2022 = 71,058 + 71,844 - 10,948 = 131,954,000,000 Net Debt increased significantly in 2022, which makes sense given the operating losses and likely increased borrowings. Actually, I want to verify this against the cash flow statement. The cash flow from financing in 2022 was: - Cash Flows From Used In Financing Activities = 33,943,000,000 (positive means cash inflow) This includes: - Proceeds From Issuing Shares: 3,252,000,000 - Changes In Ownership Interests: 1,795,000,000 - Cash Flows With Shareholders total: 4,572,000,000 - Proceeds From Borrowings: 34,165,000,000 - Repayments Of Borrowings: -5,876,000,000 - Subordinated liabilities: 994,000,000 - Payments on perpetual bonds: -606,000,000 - Funding contributions: 694,000,000 - Cash Flows With Parties Other Than Shareholders: 29,371,000,000 Total financing inflows = 33,943,000,000 This is consistent with increased debt levels. Now, looking at operating and investing cash flows: - Operating: -7,425,000,000 - Investing: -25,085,000,000 - Total before financing: -32,510,000,000 Financing provided 33,943,000,000, which roughly covers the operating and investing outflows, consistent with the net debt increase of about 40 billion (131,954 - 91,638 = 40,316). Actually, the increase is 40,316 million, but financing was 33,943 million. The difference might be from exchange rate effects, working capital changes in debt classification, or other items. Anyway, my debt calculation seems broadly consistent. One final check: Should I use average net debt or year-end net debt? S&P typically uses year-end or last-12-months average. For simplicity and given the data, I'll use year-end. Actually, I want to reconsider whether I should express this as a positive number by taking absolute value, or if negative is correct. Mathematically, negative EBITDA with positive Net Debt gives a negative ratio. In credit analysis, this is sometimes expressed as "NM" or the negative number is kept to show the direction. However, looking at this practically, if I were an analyst, I might also calculate Net Debt / EBITDA using average debt or some normalized EBITDA. But given the explicit instruction to use S&P methodology and the data provided, I'll calculate it as: Net Debt / EBITDA = 131,954 / (-4,986) = -26.46 But actually, I wonder if the convention is to report this as a positive number (i.e., the magnitude) with a note that EBITDA is negative, or to keep the negative sign. Looking at S&P practices, when they report ratios with negative denominators, they typically either: 1. Report "NM" (not meaningful) 2. Report the negative value 3. Use an alternative metric Given the question asks for a numerical answer, I'll provide the calculated value. Let me do the precise calculation: 131,954,000,000 / 4,986,000,000 = 26.4649... So with negative EBITDA: -26.46 Or should I express this as 26.46 with a note? No, the mathematical result is negative. Actually, rethinking one more time: In some financial databases, Net Debt/EBITDA is reported as a positive number when both are negative (Net Cash / negative EBITDA = positive ratio), but here Net Debt is positive and EBITDA is negative, so the ratio is negative. Hmm, but wait. Let me re-verify: is Net Debt definitely positive? Gross Debt = 142,902,000,000 Cash = 10,948,000,000 Net Debt = 131,954,000,000 (positive, i.e., net debt position, not net cash) Yes, Net Debt is positive. So Net Debt / EBITDA = positive / negative = negative. The ratio is -26.46. However, I want to express this more carefully. Let me round to one decimal place: -26.5 Or should I use more precision? The data is in millions, so two decimal places seems reasonable. Actually, looking at this again, I realize there might be a different interpretation. Some analysts calculate "Net Debt / EBITDA" where if EBITDA is negative, they might use the absolute value or report it as ">100" or "NM". But mathematically, it's negative. Given the explicit format requested ("VALUE" with no units), I'll provide -26.46 or rounded to -26.5. Let me recalculate more precisely: 131954 / 4986 = 26.464902... So -26.46 or -26.5. I'll provide -26.46. Wait, I want to check one more thing. Is there any possibility that "Operating Profit Before Depreciation And Amortisation" should be adjusted to exclude certain items for S&P purposes? For example, the "Net Changes In Fair Value On Energy And Commodity Derivatives Excluding Trading Activities" = -849,000,000. This is a non-cash item related to hedging. S&P might adjust for this in their "Adjusted EBITDA." If I add this back (since it's a non-cash fair value change): -4,986 + 849 = -4,137 (still negative) Or the "Other Income And Expenses Excluded From Ebe" = 687,000,000. If this is excluded from EBE but S&P thinks it should be included... but it's already excluded, and we want to use EBE/EBITDA as reported. Actually, S&P might also adjust for the impairment reversal of 1,762,000,000. But this is already below EBITDA in the income statement, so it's not in EBITDA. Hmm, let me think about whether S&P would start from a different point. S&P Adjusted EBITDA typically adds back: - Non-recurring items - Restructuring costs - Asset impairments (if not already added back) But the impairment reversal is a positive item (gain), so adding it back would reduce EBITDA further (make it more negative). I think the standard approach is to use the reported EBITDA figure, which is -4,986,000,000. One more consideration: Should I use continuing operations or total operations? The EBITDA figure seems to be for total operations (or at least the main operating activities). "Profit Loss From Continuing Operations" = -18,231,000,000, while "Profit Loss" = -18,225,000,000 (difference is 6 million from discontinued operations, negligible). So the EBITDA of -4,986,000,000 is essentially for continuing operations. Given all this analysis, I'm confident in my calculation: Net Debt / EBITDA = 131,954 / (-4,986) = -26.46 I'll express this as -26.46. Actually, I want to do one final sanity check. Let me verify the balance sheet balances: Assets 2023-01-01: 388,132,000,000 Equity And Liabilities 2023-01-01: 388,132,000,000 ✓ Assets 2022-01-01: 360,966,000,000 Equity And Liabilities 2022-01-01: 360,966,000,000 ✓ Good, the balance sheets balance. Equity 2023-01-01: 46,612,000,000 Equity 2022-01-01: 61,989,000,000 Decrease in equity = 15,377,000,000 This is roughly consistent with the net loss of 18,225,000,000 minus some comprehensive income adjustments and capital increases. Actually, comprehensive income 2022 = -18,453,000,000 total Plus capital increases (issue of equity) = 4,240,000,000 Less dividends = -1,457,000,000 Less other changes = -1,917,000,000 (wait, this is negative in the data?) Hmm, the equity reconciliation is complex with many items. But the balance sheet balances, so the figures are internally consistent. I'm now confident in my answer. -26.46