**Step 1: Identify the relevant industry**

The entity is "TERNA - RETE ELETTRICA NAZIONALE SOCIETA' PER AZIONI" (Terna S.p.A.). Terna is the Italian transmission system operator (TSO) for electricity. It manages the high-voltage electricity transmission grid.
Based on the provided industry descriptions:
*   **Regulated Utilities:** This sector includes companies that provide essential infrastructure services, are shielded from competition, and are subject to comprehensive regulation. The description explicitly lists "Electricity National" under subsectors. Terna operates as a natural monopoly in electricity transmission in Italy, with tariffs regulated by ARERA (the Italian Regulatory Authority for Energy, Networks and Environment). It fits the definition of a Regulated Utility perfectly, specifically a transmission network operator which is typically considered low risk and stable.
*   **Unregulated Power And Gas:** Terna is not an unregulated generator or retailer; it is a regulated network operator.
*   **Transportation Infrastructure:** While transmission lines are infrastructure, the specific utility methodology takes precedence for electricity networks.
*   **Oil And Gas:** Not applicable.

Therefore, the relevant industry is **Regulated Utilities**.

**Step 2: Estimate Adjusted Debt**

The baseline formula for Adjusted Debt is:
`Adjusted_Debt = (reported_debt + leases + pension_deficit + guarantees + hybrid_debt_portion + other_debt_like_items) - eligible_cash`

Let's extract the relevant data from the 2022 fiscal year (ended Dec 31, 2022, reported as 2023-01-01 balance sheet items or 2022 income statement items where appropriate. Note: The prompt provides balance sheet data for "2023-01-01" which corresponds to the end of the 2022 fiscal year, and "2022-01-01" which is the end of 2021. We use the ending balances for 2022, i.e., the column labeled "2023-01-01" for balance sheet items).

*   **Reported Debt:**
    *   Long-term Borrowings: 8,416,700,000 EUR
    *   Short-term Borrowings: 444,100,000 EUR
    *   Current Portion of Long-term Borrowings: 1,909,300,000 EUR
    *   Noncurrent Financial Liabilities: 247,200,000 EUR
    *   Current Financial Liabilities: 44,900,000 EUR
    *   *Total Reported Interest-Bearing Debt* = 8,416,700,000 + 444,100,000 + 1,909,300,000 + 247,200,000 + 44,900,000 = **11,062,200,000 EUR**.

*   **Leases:** The provided facts do not explicitly list "Lease Liabilities". In many utility reports, if not explicitly broken out as a separate debt-like line item in the summary, they might be included in other provisions or not material enough to adjust significantly without specific data. However, looking at "Other Longterm Provisions" (140,800,000) and "Other Current Liabilities" (669,900,000), these are generic. Without explicit "Lease Liability" data, we assume reported debt captures the primary financial obligations or that leases are immaterial/not disclosed in this specific fact set for adjustment. We will proceed with reported interest-bearing debt. *Correction*: S&P typically adds operating lease liabilities. If not provided, we cannot add them. We will stick to the explicit debt items.

*   **Pension Deficit:**
    *   We look for "Noncurrent Provisions For Employee Benefits". The value is 48,400,000 EUR.
    *   S&P adjusts for the underfunded status of defined benefit pension plans. The provision on the balance sheet usually reflects the accrued liability. If the plan is fully funded, there is no deficit. If underfunded, the deficit is the difference between the obligation and assets. The fact "Noncurrent Provisions For Employee Benefits" represents the net liability recognized. S&P often treats the *unfunded* portion as debt. Without specific asset/fair value data for the pension plan, we often use the reported provision as a proxy for the deficit if it's a net liability, or assume the provision *is* the debt-like item. However, standard S&P adjustment adds the *underfunded* amount. Let's look for "Defined Benefit Plans" info. We see "Other Comprehensive Income Net Of Tax Gains Losses On Remeasurements Of Defined Benefit Plans". This confirms existence. Without specific asset values, we will conservatively assume the reported provision of **48,400,000 EUR** is the net liability (deficit) to be added, or that it is already part of the "provisions" and not "debt". S&P methodology says: "Add the underfunded status of defined benefit pension plans". If the balance sheet liability is 48.4M, this is the underfunded amount (net). So we add **48,400,000 EUR**.

*   **Hybrid Debt Portion:**
    *   The facts list "Equity Instruments Perpetual Hybrid Bonds" with a value of **989,000,000 EUR** in the Equity section.
    *   S&P typically treats hybrid bonds as 50% debt and 50% equity for rating purposes, unless specified otherwise (e.g., if they are deeply subordinated or have equity-like features, they might be treated more as equity, but the standard baseline adjustment is often 50% debt credit). However, the prompt asks to estimate "Adjusted_Debt" using the formula `+ hybrid_debt_portion`.
    *   Standard S&P practice for utilities: Hybrids are often given 50% debt credit. So, 50% of 989,000,000 = **494,500,000 EUR**.

*   **Other Debt-Like Items / Guarantees:** No specific data provided for guarantees or other debt-like items.

*   **Eligible Cash:**
    *   Cash and Cash Equivalents: 2,155,100,000 EUR.
    *   S&P allows netting cash against debt. For regulated utilities with stable cash flows, cash is often fully eligible.
    *   Eligible Cash = **2,155,100,000 EUR**.

*   **Calculation of Adjusted Debt:**
    *   Reported Debt: 11,062,200,000
    *   + Pension Deficit: 48,400,000
    *   + Hybrid Debt Portion (50%): 494,500,000
    *   - Eligible Cash: 2,155,100,000
    *   Adjusted Debt = 11,062,200,000 + 48,400,000 + 494,500,000 - 2,155,100,000
    *   Adjusted Debt = 11,605,100,000 - 2,155,100,000 = **9,450,000,000 EUR**.

    *Self-Correction/Refinement on Hybrids*: Some methodologies might treat hybrids entirely as equity if they are perpetual and non-cumulative, but the "debt portion" instruction implies adding a portion. 50% is the standard default for "hybrid" classification in S&P adjusted leverage calculations for investment grade utilities.

    *Self-Correction on Cash*: Regulated utilities often have working capital needs. However, Terna has significant cash. S&P usually nets unrestricted cash. We will net the full amount.

**Step 3: Estimate Adjusted EBITDA**

The baseline formula is:
`Adjusted_EBITDA = EBITDA + adjustment_leases + nonrecurring_losses - nonrecurring_gains ± pension_adjustments ± other_normalization_adjustments`

First, we need to calculate Reported EBITDA for 2022.
EBITDA = Profit from Operating Activities (EBIT) + Depreciation & Amortization.

From the facts for 2022-01-01 - 2023-01-01:
*   "Profit Loss From Operating Activities" (EBIT): **1,333,500,000 EUR**.
*   "Depreciation Amortisation And Impairment Loss Reversal...": **725,700,000 EUR**.
    *   Note: The line item includes "Reversal of Impairment Loss". We should check if there are significant reversals. The Cash Flow statement shows "Adjustments For Depreciation And Amortisation Expense And Impairment Loss Reversal..." as 736,100,000 EUR. The P&L line is 725,700,000 EUR. The difference might be due to classification. Let's use the P&L figure for EBITDA reconstruction as it matches the operating profit.
    *   Wait, the Cash Flow adjustment (736.1M) is higher than the P&L D&A (725.7M). The difference is 10.4M. This could be non-cash movements or impairments not in operating profit? Usually, EBITDA is EBIT + D&A.
    *   Let's check "Expense By Nature". Total Expense by Nature is 1,631,000,000.
    *   Revenue and Operating Income is 2,964,500,000.
    *   Operating Profit = Revenue - Expenses?
    *   2,964,500,000 (Rev) - 1,631,000,000 (Exp) = 1,333,500,000. This matches "Profit Loss From Operating Activities".
    *   So, EBIT = 1,333,500,000.
    *   D&A = 725,700,000.
    *   Reported EBITDA = 1,333,500,000 + 725,700,000 = **2,059,200,000 EUR**.

*   **Adjustments:**
    *   **Leases:** If we added lease liabilities to debt, we should add lease interest and amortization back to EBITDA (or rather, add the operating lease expense if it was deducted). Under IFRS 16, lease expense is replaced by depreciation and interest. EBITDA under IFRS 16 already includes the depreciation of right-of-use assets but excludes the interest. The "Depreciation" figure likely includes ROU depreciation. The "Finance Costs" include lease interest. S&P adjustments for leases usually involve adding back the implied interest to EBITDA if comparing to pre-IFRS 16, OR simply treating the EBITDA as reported under IFRS 16 which is generally accepted. However, the prompt formula says `+ adjustment_leases`. If we assume the reported EBITDA is IFRS 16 compliant, no adjustment is typically needed for the *level* of EBITDA unless we are normalizing to a pre-lease standard. Given the lack of specific lease expense data, we assume Reported EBITDA is the starting point.
    *   **Non-recurring items:** The facts do not explicitly identify significant non-recurring gains or losses in the P&L summary. "Share Of Profit Loss Of Associates" is -1,000,000 EUR (negligible). "Profit Loss From Discontinued Operations" is -20,300,000 EUR. This is below operating profit, so it doesn't affect EBITDA (which is pre-interest, tax, and usually pre-discontinued ops if derived from Operating Profit).
    *   **Pension Adjustments:** S&P often normalizes pension expense to a "service cost" basis or adds back the difference between reported cost and cash contributions/normalized cost. Without detailed pension service cost vs interest cost breakdown, we typically leave this as reported or make a small adjustment if the deficit is large. Given the small pension provision (48M), the adjustment is likely negligible.
    *   **Other Normalization:** None identified.

*   **Adjusted EBITDA** = **2,059,200,000 EUR**.

    *Alternative Check*: Sometimes "EBITDA" is defined as Operating Cash Flow before working capital changes + Interest Paid + Taxes Paid?
    Cash Flow from Operations (before WC) = 2,072,700,000 EUR.
    This is very close to our calculated EBITDA of 2,059,200,000 EUR. The difference is ~13.5M.
    CFO (before WC) = EBITDA - Changes in provisions/other non-cash?
    The CFO before WC is often a good proxy for EBITDA in utilities.
    Let's stick to the reconstructed EBITDA: 2,059,200,000 EUR.

**Step 4: Calculate Ratio**

Adjusted Debt = 9,450,000,000 EUR
Adjusted EBITDA = 2,059,200,000 EUR

Ratio = 9,450,000,000 / 2,059,200,000
Ratio ≈ 4.58916...

Rounding to two decimal places: **4.59**

Let's double check the Hybrid treatment. If S&P treats the hybrids as 100% equity (common for strong utilities with perpetual non-cumulative hybrids), the debt would be lower.
Debt without hybrid portion: 11,062,200,000 + 48,400,000 - 2,155,100,000 = 8,955,500,000.
Ratio: 8,955,500,000 / 2,059,200,000 = 4.35.

However, the prompt explicitly includes `+ hybrid_debt_portion` in the formula. This implies we *must* include a portion. The standard S&P "hybrid debt portion" is 50%. If the instrument is classified as equity but has debt-like features, 50% is the standard adjustment for leverage ratios in the utility sector unless specified as "equity credit" of 100% (which would mean 0% debt portion). Terna's hybrids are likely perpetual subordinated bonds. S&P typically assigns a 50% equity credit (50% debt portion) to such instruments for regulated utilities.

Let's double check the Cash netting.
S&P methodology for Regulated Utilities: "We adjust inventory and debt balances by netting the value of inventory against outstanding short-term borrowings...". It does not explicitly say to net *all* cash. However, the general corporate baseline formula provided in the prompt is `Adjusted_Debt = ... - eligible_cash`.
Is all cash eligible? For a utility, yes, usually.
Cash = 2,155,100,000.

Let's double check the Debt components.
Long-term Borrowings: 8,416,700,000
Short-term Borrowings: 444,100,000
Current Portion LT Borrowings: 1,909,300,000
Noncurrent Financial Liabilities: 247,200,000
Current Financial Liabilities: 44,900,000
Sum = 11,062,200,000.

Pension Deficit: 48,400,000.
Hybrid (50%): 494,500,000.
Total Gross Adjusted Debt = 11,605,100,000.
Net Adjusted Debt = 11,605,100,000 - 2,155,100,000 = 9,450,000,000.

EBITDA:
EBIT: 1,333,500,000
D&A: 725,700,000
EBITDA: 2,059,200,000.

Ratio: 9,450,000,000 / 2,059,200,000 = 4.589... -> 4.59.

If we assume the "Hybrid Debt Portion" refers to the *entirety* of the hybrid being treated as debt (unlikely for equity-classified hybrids, but possible if the prompt implies a conservative view), the debt would be higher. But "portion" suggests a fraction. 50% is standard.

If we assume *no* cash netting (conservative):
Debt = 11,605,100,000.
Ratio = 11,605,100,000 / 2,059,200,000 = 5.63.
However, the formula explicitly says `- eligible_cash`. Cash is generally eligible.

If we assume the pension deficit is already in the debt (it's a provision, not borrowing), we added it. Correct.

Final check on EBITDA.
Is there any "nonrecurring" item?
"Profit Loss From Discontinued Operations" is -20.3M. This is *after* operating profit. So it is not in EBITDA.
"Share of profit/loss of associates" is -1M. This is usually below operating profit or in "other income". In the provided facts, "Profit Loss From Operating Activities" is 1,333.5M. "Finance Income Cost" is 22.7M. "Share of profit..." is -1M. "Profit Before Tax" is 1,233.4M.
1,333.5 + 22.7 - 1.0 = 1,355.2? No.
1,333.5 (Op Profit) + 22.7 (Net Finance Income? No, Finance Income Cost is usually net) -> Wait.
Finance Income Cost: 22,700,000.
Finance Costs: 121,800,000.
This implies Finance Income was ~144.5M? Or is "Finance Income Cost" the net?
Usually "Finance Income Cost" is the net line.
Let's check the math for PBT.
Op Profit: 1,333,500,000
+ Share of Associates: -1,000,000
+/- Finance: The line "Finance Income Cost" is 22,700,000. If this is income, it adds.
1,333.5 - 1.0 + 22.7 = 1,355.2.
But PBT is 1,233.4.
Difference: 1,355.2 - 1,233.4 = 121.8.
Ah, "Finance Costs" is 121,800,000.
It seems "Finance Income Cost" might be just the *Income* part? Or the label is confusing.
If Finance Costs are 121.8M, and PBT is 1,233.4M.
1,333.5 (Op) - 121.8 (Fin Cost) + X (Fin Inc) - 1.0 (Assoc) = 1,233.4.
1,210.7 + X = 1,234.4.
X (Finance Income) = 23.7M.
The line "Finance Income Cost" is 22.7M. Close enough (rounding or other minor items).
Regardless, EBITDA is derived from Operating Profit.
EBITDA = Op Profit + D&A = 1,333.5 + 725.7 = 2,059.2M.

The calculation holds.

<answer>4.59</answer>