**1. Identify the relevant industry for "ACEA S.P.A."**

ACEA S.P.A. is an Italian multi-utility company. Based on the description ("Ricavi Da Vendita EPrestazioni" - Revenues from sales and services), its operations span water, electricity, and gas distribution/networks, along with waste management and energy production. This clearly fits the **Regulated Utilities** industry, and the provided methodology mentions "Multi-utilities" as a subsector. Therefore, we will apply the **Regulated Utilities** methodology and the associated adjustments.

**2. Estimate the 2021 "Adjusted_EBITDA"**

First, we need to reconstruct the reported EBITDA for 2021.
- Revenue 2021: 3,972,061,000 EUR
- Operating Expense 2021: 2,737,035,000 EUR
- Other Income 2021: 156,032,000 EUR

We have "Gross Profit" which in Italian GAAP/IFRS is often the reported EBITDA (Margine Operativo Lordo).
- Gross Profit 2021: 1,256,075,000 EUR
This is equivalent to Revenue + Other Income - Operating Expense: 3,972,061 + 156,032 - 2,737,035 = 1,391,058? Wait.
Let's check standard formula: Revenue - Operating Costs = EBITDA.
"Gross Profit" (Margine Operativo Lordo) is typically Revenue + Other Income - Employee Benefits - Costi Esterni - Other Operating Expenses. Let's verify.
Operating Expense = 2,737,035,000
Employee Benefits = 275,819,000
Costi Esterni = 2,461,216,000
Sum = 2,737,035,000. Matches Operating Expense.
Gross Profit = Revenue (3,972,061) + Other Income (156,032) - Operating Expense (2,737,035) = 1,391,058?
Wait, "Gross Profit" 2021 is 1,256,075,000 EUR. The document says Gross Profit 2021 is 1,256,075,000 EUR. Let's check the components.
Revenue 2021: 3,972,061,000
Other Income 2021: 156,032,000
Employee Benefits 2021: 275,819,000
Costi Esterni 2021: 2,461,216,000
EBITDA = 3,972,061 + 156,032 - 275,819 - 2,461,216 = 1,391,058.
There is a discrepancy. The provided "Gross Profit" (Margine Operativo Lordo) is 1,256,075,000 EUR. This suggests there are additional operating costs not broken down in the `Employee Benefits Expense` or `Costi Esterni`, or `Gross Profit` is correctly labeled as MOL but `Other Income` is partially excluded. We will use the provided "Gross Profit" as the **Reported EBITDA**, as it is the standard MOL figure in Italian reports.
- Reported EBITDA 2021 = 1,256,075,000 EUR

Now, adjustments for S&P Adjusted EBITDA:
- **Non-recurring items**: We need to look for gains/losses on disposals, etc.
- `Gains Losses On Change In Fair Value Of Derivatives` 2021: 0 EUR
- `Other Income Expense From Subsidiaries Jointly Controlled Entities And Associates` 2021: 21,048,000 EUR. This is likely dividends/income from associates and JVs, which is generally part of EBITDA but not part of operating profit in IFRS? In IFRS, income from associates/JVs is below operating profit. For S&P, proportional EBITDA from JVs is an adjustment, but income from associates is typically excluded (treated as investment income). Let's hold this.
- `Profit Loss From Operating Activities` (EBIT) 2021: 581,101,000 EUR
- `Ammortamenti EAccantonamenti` (D&A + Provisions) 2021: 588,768,000 EUR
- `Impairment Loss` 2021: 86,207,000 EUR
Check: EBIT = Gross Profit - D&A - Provisions - Impairment + Gains/Losses + Other Op.
1,256,075 - 588,768 - 86,207 = 581,100. Matches EBIT.
So, Reported EBITDA 2021 = 1,256,075,000 EUR.

For Regulated Utilities, adjustments include:
- **Leases**: IFRS 16 leases are included. We'll include lease depreciation in adjusted EBITDA, but typically S&P adds back lease interest to EBITDA. Actually, S&P treats leases as debt-like, so Adjusted EBITDA = EBITDA + Lease Depreciation + Lease Interest. Or, simpler, if D&A includes right-of-use depreciation, we don't need to add it back because EBITDA is already before D&A. We need to adjust for lease interest.
`Right-of-use Assets` 2022-01-01 (start of 2022 = end of 2021): 53,096,000 EUR. This is balance sheet.
We don't have lease interest broken down. We assume finance costs include lease interest. We'll note this but lack exact data.
- **Pensions**: `Noncurrent Provisions For Employee Benefits` 2022-01-01: 120,150,000 EUR. S&P adds back service cost and deducts contributions. We lack detailed data. We'll assume EBITDA is not materially adjusted for pensions unless there's a huge deficit.
- **Non-recurring items**: None explicitly identified in 2021. We assume 0.
- **Proportional EBITDA from JVs**: `Other Income Expense From Subsidiaries Jointly Controlled Entities And Associates` 2021: 21,048,000 EUR. This is a line item in the income statement. It's likely dividends/equity earnings. For S&P, we adjust to proportional consolidation, but without details, this is complex. We'll note it but likely leave EBITDA as reported, as this item is below EBITDA in IFRS.
Given the "Gross Profit" is explicitly given as EBITDA (Margine Operativo Lordo), we use it directly.
**Adjusted EBITDA 2021 = 1,256,075,000 EUR**

**3. Estimate the 2021 "FFO"**

FFO = Adjusted EBITDA - Cash Interest - Cash Taxes

- **Cash Interest**: `Finance Costs` 2021: 97,388,000 EUR.
  We need to adjust for non-cash interest (like accruals) and add lease interest. Lacking details, we use a proxy: `Interest Paid Classified As Financing Activities` 2021: 100,752,000 EUR. This is a good proxy for cash interest.
  Cash Interest 2021 = 100,752,000 EUR.

- **Cash Taxes**: `Income Tax Expense Continuing Operations` 2021: 150,662,000 EUR.
  `Income Taxes Paid Refund Classified As Operating Activities` 2021: 180,117,000 EUR.
  Cash Taxes Paid 2021 = 180,117,000 EUR.

FFO 2021 = 1,256,075,000 - 100,752,000 - 180,117,000 = **975,206,000 EUR**

**4. Estimate the 2021 "Adjusted_Debt"**

Adjusted Debt = Reported Debt + Leases + Pension Deficit + Guarantees + Hybrid Debt - Eligible Cash

- **Reported Debt**: `Other Noncurrent Financial Liabilities` 2022-01-01: 4,791,979,000 EUR
  `Other Current Financial Liabilities` 2022-01-01: 285,222,000 EUR
  Total Reported Financial Debt = 4,791,979 + 285,222 = 5,077,201,000 EUR

- **Leases**: `Right-of-use Assets` 2022-01-01: 53,096,000 EUR. We assume this is the same as lease liabilities.

- **Pension Deficit**: `Noncurrent Provisions For Employee Benefits` 2022-01-01: 120,150,000 EUR. We assume this is the net deficit.

- **Guarantees/Hybrids**: Not mentioned. Assumed 0.

- **Eligible Cash**: `DisponibilitàLiquide EMezzi Equivalenti Alla Fine Dellesercizio` 2022-01-01: 680,820,000 EUR. S&P usually deducts only "surplus" cash, but without working capital analysis, we deduct all.

Adjusted Debt 2021 = 5,077,201 + 53,096 + 120,150 - 680,820 = **4,569,627,000 EUR**

**5. Calculate the 2021 "Adjusted_Debt / Adjusted_EBITDA" ratio**

4,569,627 / 1,256,075 = **3.64x**

**6. Calculate the 2021 "FFO / Adjusted_Debt" ratio**

975,206 / 4,569,627 = **0.2134 (21.3%)**

**7. Estimate the 2022 "Adjusted_EBITDA"**

- Reported EBITDA 2022 = `Gross Profit` 2022: 1,305,021,000 EUR.
**Adjusted EBITDA 2022 = 1,305,021,000 EUR**

**8. Estimate the 2022 "FFO"**

- **Cash Interest**: `Interest Paid Classified As Financing Activities` 2022: 114,121,000 EUR.

- **Cash Taxes**: `Income Taxes Paid Refund Classified As Operating Activities` 2022: 178,506,000 EUR.

FFO 2022 = 1,305,021,000 - 114,121,000 - 178,506,000 = **1,012,394,000 EUR**

**9. Estimate the 2022 "Adjusted_Debt"**

- **Reported Debt**: `Other Noncurrent Financial Liabilities` 2023-01-01: 4,722,263,000 EUR
  `Other Current Financial Liabilities` 2023-01-01: 619,418,000 EUR
  Total Reported Financial Debt = 4,722,263 + 619,418 = 5,341,681,000 EUR

- **Leases**: `Right-of-use Assets` 2023-01-01: 90,397,000 EUR.

- **Pension Deficit**: `Noncurrent Provisions For Employee Benefits` 2023-01-01: 112,989,000 EUR.

- **Eligible Cash**: `DisponibilitàLiquide EMezzi Equivalenti` 2023-01-01: 559,908,000 EUR.

Adjusted Debt 2022 = 5,341,681 + 90,397 + 112,989 - 559,908 = **4,985,159,000 EUR**

**10. Calculate the 2022 "Adjusted_Debt / Adjusted_EBITDA" ratio**

4,985,159 / 1,305,021 = **3.82x**

**11. Calculate the 2022 "FFO / Adjusted_Debt" ratio**

1,012,394 / 4,985,159 = **0.2031 (20.3%)**

**12. Classify the year-on-year credit trend between 2021 and 2022**

- **Signal 1: Leverage**
  Change in Adjusted Debt / Adjusted EBITDA = 3.82 - 3.64 = **+0.18x**
  Threshold: between -0.2x and +0.2x is Stable.
  Signal 1 = **Stable**

- **Signal 2: Cash-flow coverage**
  Change in FFO / Adjusted Debt = 0.2031 - 0.2134 = **-0.0103** (i.e., -1.03 percentage points)
  Threshold: between -0.03 and +0.03 is Stable.
  Signal 2 = **Stable**

Both signals agree on **Stable**.

<answer>Stable</answer>